JOHNS CREEK, Ga. — Johns Creek officials approved a finance plan that may net the city just shy of half a million dollars in extra revenue this year.
At its Jan. 28 meeting, the City Council approved moving city funds to a state supervised account that will maximize interest earnings.
Based on the recommendation of Finance Director Jeff Bohm, the city will move some general fund money and funds associated with the transportation sales tax referendum, or TSPLOST, to a Georgia Fund 1 account operated by the state.
The funds for the parks bond are already held in a Georgia Fund 1 account, and the council also voted to grant Bohm control over the account.
As explained in a prior work session, the city is legally limited in how it can invest its money. High interest accounts are typically off limits because they carry some risk.
The city has been storing $40 million in general funds in a United Community Bank account yielding 0.15 percent as of November 2018.
Georgia Fund 1, an investment pool offered by the state to counties, municipalities and other public entities, was yielding 2.223 percent as of November 2018.
Finance Department estimates show, with a monthly balance of $20 million, the city could earn $414,600 additional interest annually for its general fund.
The TSPLOST fund, which was earning 1.81 percent in an East West Bank money market account, would see additional revenue of $52,000.
The council also discussed adopting a cash and investments policy for the city at its Jan. 28 work session. The policy draft outlines the goals of investment, ethical standards, types of investment and reporting the status of the investment portfolio.
“An investment policy should describe the most prudent, primary objectives for a sound policy,” Bohm said. “Safety, liquidity, and yield, in those orders, are very important.”
This policy is based on state and federal laws and the guidelines of the Georgia Government Finance Officers Association, Bohm said. It is scheduled to be voted on at the council’s next meeting, Feb. 11.
“A lot of this is just reflective of what state law already has, so it’s not a major policy change,” City Manager Warren Hutmacher said. “We’re not working without boundaries now. We’re basically working within the bounds of this policy already.”
In other business, the council approved a $525,000 contract with E.R. Snell for patching potholes and other pavement repairs. This amount was budgeted in the city’s 2019 financial plan.
The contract addresses potholes on Jones Bridge Road, Medlock Crossing Parkway, West Morton Road, Buice Road and Old Alabama Road.