The Winnfield City Council in special session declined to enter an agreement with Louisiana Asset Management Pool (LAMP), choosing instead to keep its monies invested locally at Sabine State Bank.

CPA Steven McKay who is currently conducting the city’s annual audit was present at the January 18 session.  He suggested that the state-sponsored LAMP investment option would give the city considerably higher payments on its investments than the 0.1% or perhaps 0.25% being paid at the bank.  If the city had acted on an available $3 million to $4 million when he first suggested it in August, citing 5%, earning could have been around $100,000.

It was Councilman Matt Miller who read aloud the agreement introduction but he immediately spoke out on concerns.  He said the LAMP account would not be insured by the FDIC as it is in the bank.  “It is possible to lose money,” he said.  McKay challenge that while the account could decline if the market is down, the state-structured system for short term investments protects against a loss.

“If you need, you can take out your money the next day.”

District Attorney Chris Nevils, attending the meeting on another matter, spoke up saying that his office uses the LAMP program on a much smaller financial basis. “ When the market is up, you make money.  But the benefits in a depressed market are not as rosy as pictured by the CPA.  I’d say it’s a wash (between LAMP and low-interest bank investment).  There are times that I’ll get as little as $15.”

Ironically, it was not Sabine State Bank but Bank of Winnfield attending the meeting.  Dicky Heard spoke, saying, “The city has most of its money at Sabine.  I don’t know if anybody has come to negotiate rates.  This plan does take this money out of the community.  We all pay taxes and I don’t know what folks would think.  You might consider not zapping all of this out of the community.”

City Attorney Herman Castete observed relating to the night’s action, just because the council approves the agreement with LAMP, it doesn’t mean that they have to move any money. 

McKay then pointed out that by making this resolution, it could create the opportunity for a more pro-active relationship with the banks.  “You might be taken more seriously.”

When Mayor Gerald Hamms called for the vote, the members barely audibly voted it down.