Kimball Mayor David JacksonKIMBALL, Tenn. -- City administrators moved quickly last week to protect Kimball's money when they suddenly found out not all of their funds were insured at local banks.
Kimball Mayor David Jackson said he was contacted two weeks ago by officials with First Volunteer Bank about the situation.
"There have been some changes in the regulations concerning governmental money," he said.
According to the new policies, the Federal Deposit Insurance Corporation will cover only $250,000 on interest-bearing accounts, officials said. It doesn't matter if the money is in separate accounts at the same bank, Jackson said; only $250,000 is covered.
"We need to get [every bank account the city holds] down to $250,000 or less," he said.
Jackson said some funds in certain banks were at risk.
Last week, the Kimball Board of Mayor and Aldermen unanimously voted to give Jackson the latitude to move the funds around so that all of the town's money would be federally insured.
"There's too much money lying on the table to let something happen to it," Alderman Mark Payne said.
Officials said now that the funds are safe, they may look into options such as purchasing additional insurance or moving the city's accounts into a Certificate of Deposit Accounts Registry Service to avoid any future problems.
Such an account basically puts all the funds with one bank that is part of a network, officials said. The bank then redistributes the money through CDs with other participating banks at or below $250,000, which provides multi-million-dollar coverage with just one bank.
"I think that's an option," Kimball Attorney Billy Gouger said. "We'll just have to see what all options are out there."
Jackson moved some money to new banks last Friday so that all the town's funds would be insured.
He said he was "concerned" the city had not been contacted by other banks with which Kimball has accounts about the new regulations.
Ryan Lewis is based in Marion County. Contact him at ryan lewis34@gmail.com.