Story Tools

Date of Issue: December 20, 2007

Anna Maria to withdraw more than $500,000 from troubled SBA fund

Anna Maria city commissioners last week unanimously agreed to withdraw more than $500,000 in city funds invested in a beleaguered state fund.

Commissioners voted unanimously last week in an emergency meeting to withdraw $502,000 the city has on deposit with the State Board of Administration Local Government Investment Pool’s Pool A account and place the money in a money market certificate with Wachovia Bank.

The city’s $75,000 deposit in Pool B will remain with the SBA.

The commission’s move came after Mayor Fran Barford and city officials met with bankers and presented the commission with various options for investing the money.

SBA accounts have taken a beating the past month after a poor credit rating was given to some SBA investments in the volatile sub-prime mortgage market. On Nov. 30, Crist temporarily froze withdrawals after nearly $16.6 billion was taken out in less than two weeks.

On Dec. 6, Crist and the SBA lifted the freeze, but restricted withdrawals from Pool A to a maximum of $2 million or 15 percent of the amount a city had on deposit, whichever was the greater number.

While the more than $500,000 the city has invested with the SBA may not be a lot of money for some large city/county governments, “That’s big money for us,” said Barford, who brought the issue to the attention of the commission three weeks ago.

Both Barford and city treasurer Diane Percycoe breathed a collective sigh of relief when the Manatee County Property Appraiser’s Office assured them - and other taxing authorities in the county - that property taxes collected are not tied up in any SBA accounts. That means Anna Maria and the other Island cities will be getting their revenue checks as scheduled next year.

Not all local governments will escape the SBA debacle.

According to Manatee County finance director Jim Seuffert, the county has $70 million deposited with the SBA and about 6 percent of that money is in investments that have defaulted. Seuffert said he expects the county to lose less than $1 million by the time all the investments are sorted and investigated.

Anna Maria city commissioners didn’t take long to make their decision to pull the funds and place them into a local financial institution which will guarantee the revenue 100 percent. The money will be in a secure money market account “which is 100 percent guaranteed,” Percycoe said.

She added that the other two Island cities were remaining in the SBA pool.