Oct. 4--The financial world has changed dramatically since the Madison County Board of Health closed the books on the fiscal year that ended June 30.

Despite getting a laudatory critique this week from its auditor, Brown and Dougherty CPAs of Lexington, department managers reported they had made changes in recent days to ensure that the board's investments were safe.

The department's and taxing districts certificates of deposit, along with its savings and checking accounts remain with the same banks, but their investments have been switched to U.S. Treasury bills from the bonds of other government entities, David Reed, the department's finance manager said.

"We believed our investments were safe, but moving them to treasury bills makes them even safer," he said.

The department has $2 million in certificates of deposit (CDs) with two local banks and one central Kentucky bank. The department's taxing district has $1.94 million in a local bank savings accounts and $500,000 in a local bank CD.

National City Bank holds a $1.4 million CD for the department, while Community Trust Banks holds an $800,000 CD and Captial One (USB) of Lexington has another $100,000.

The taxing district has $1.94 million in a National City Bank and a $500,000 CD with People's Bank of Madison County.

The funds represent the board's state-mandated reserve fund as well as money it has been setting aside for the past few years for future construction projects, said Jim Rousey, health department director.

The department's checking account with National City averages about $1 million, Reed said. Its funds are loaned overnight to the Federal Reserve Bank of Cleveland, earning the department a modest amount of interest.

For added security, Rousey said the board's investments would be dispersed gradually among additional financial intuitions.

"This is not something we would do in haste," he said. "We don't want to incur penalties for cashing in CDs early or add to existing market turmoil."

The board got high marks from its auditor.

"This is one of my favorite accounts," Fred Brown told the board. "There are no problems to be corrected or that even require a comment."

Brown said he often recommends Madison County as a model for other health boards its firm audits.

"If they need advice on managing their internal accounts, I tell them to call (finance manager) David Reed or (department director) Jim Rousey.

Bill Robinson can be reached at brobinson@richmondregister.com or at 623-1669, Ext. 267.

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