KINGSLAND — The Kingsland Water Supply Corp. board is withdrawing about $1 million from one account and putting the funds in another account with a higher interest rate. “We are moving forward with a new investment agreement, and we have changed our investment policy to reflect that,” General Manager Earl Foster said.
The board decided to re-invest the funds during a special meeting recently at KWSC headquarters, 1422 West Drive.
About $1 million will be re-invested into “long-term collaterized bonds” set to mature “within three to four years” and pay interest at a rate between 5 percent and 12 percent each month to KWSC, Foster said.
“We will be getting something every month,” he added.
The corporation will hold the option to retain or re-invest the interest earnings, depending on the overall financial outlook, Foster said.
“I think the consensus now is to wait and see what the economy will do,” he added.
Investment banker David Porter of the Austin-based Eagle Securities investment firm will facilitate purchase of the bonds, Foster said.
“He has been doing investment for a while,” Foster added.
KWSC will withdraw about $1 million from its state-approved TexStar account to purchase the new bonds, Foster said.
During recent months, KWSC has earned interest payments at a barely visible rate of 0.16 percent on the TexStar account, Foster added.
Turning to another matter, the board is definitely pleased with ongoing progress on the construction of the new water treatment plant, Foster said.
“Everything is going well,” he added.
About 70 percent of the piping has been installed for the new plant, which will cost about $5 million, Foster said.
In about two weeks, the main frame of the new plant will start to go up, he added.
“It will start to look like a building instead of just a slab,” Foster said.
Excel Corp. is the primary contractor for the new facility, which is being built with funding from the U.S. Department of Agriculture.
“They are moving on,” Foster said. “The contract is on track.”