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HomeMy WebLinkAboutResolution - 2706 - Contract - American State Bank - Depository Designation - 12_17_1987Resolution #2706 December 17, 1987 Item #31 BID #9542 DGV:js RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute for and on behalf of the City of Lubbock a Designation of Depository and Contract for the Custody of the Funds of the City of Lubbock, Texas by and between the City of Lubbock and American State Bank of Lubbock, Texas, attached herewith, which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this 17th day of ATTEST: Ranette Boyd, City Secretary APPROVED AS TO FORM: Donald U. Vandiver, First Assistant City Attorney December , 1987. xf. C.h,-S B. C. McMINN, MAYOR REQUEST FOR PROPOSALS RFP # 9542 The City of Lubbock is soliciting proposals for PROPOSAL FOR BANKING SERVICES Any correspondence, questions, or requests for copies of the Request for Proposals should be directed to the City of Lubbock, Texas, Gene Eads, Purchasing Manager. Proposals will be received in the Office of the Purchasing Manager, Municipal Bldg., 1625 13th St., Room L-04, Lubbock, TX 79401 until 2:00 o'clock p.m. on the 19th day of November, 1987. CITY O LUBBOCK 'By: 41WE EABS, C. .M. PURCHA ING MANAGER BANKING SERVICES PROPOSAL RESPONSE FORM BANK NAME: American State Bank, Lubbock, TX —rL�r_r------- .-rrL�_r1��rLrwr—_---wr__ OFFICIAL SUBMITTING (TYPED) D_on Hudg_eons� _ OFFICIAL S i GNATURE s_-i V TITLE OF OFFICIAL: Executive V' President TELEPHONE NUMBER: (806) 763-7061 ELNK 1ffi_5EEV 19EZ UNIT .EBIGE Account Maintenance $10.00 Items Paid by Check .175 Items Paid by Direct Deposit .08 Deposits .15 Items Deposited, MICR Encoded .05 Items Deposited, Non -Encoded .07 Stop Payments 15.00 Wire Transfers 15.00 investment Transactions 35.00 Safety Deposit Box 96.00/yr Returned Items .50 Other itemized Services, as Suggested by Bidding Banks •.rrlr�L—�.rrr_1rrVLr—wrw�.n_rr— .__a.---------r----w— r�rLrww—rrlw—r -------r--r---wr—_rr Other Quotations: Rate Quotation on Sweep Account:The A_verage_Fed Funds Rate minus .65% Rate Quotation on Overdrafts: The $verra�e_Fed_Funds Rate minus 1.50% Rate Quotation on Loans: The Average_Fed Funds Rate minus 1.50% Our Bank can comply with all aspects of the City's banking service requirements. ( yes or no) -w?� ,_,_w__� (If no, list all exceptions on separate page.) CITY OF LUBBOCK REQUEST FOR PROPOSAL FOR BANKING SERVICES RFP 19542 The City of Lubbock is requesting proposals for banking services from commercial banks located within the Lubbock City Limits. Responses to this request for proposals (RFP) should be submitted to a sealed envelope no later than 2:00 p.m. on November 19, 1987, clearly identified as "Proposal for Banking Services", and mailed (or delivered) to: Gene Eads, C.P.M. Purchasing Manager 1625 - 13th Street, Room L04 Lubbock, Texas 79401 2. a;z!?QanAl All responses must be presented on the standardized "Banking Services Proposal Response Form" which has been provided. Supporting material may be provided. However, the City's decision will primarily be based upon a comparison of the standardized proposal forms received. The City reserves the right to reject any or all proposals, or to informally negotiate certain points of the final contract with a qualified banker. 3. 4���tl�n�-;�n9-89�1t isn�1_lnigcm;�tig>ai A proposal conference will be held in the City Hall Committee Room on November 5, 1987, at 10:00 a.m. At that time, all prospective banks are invited to request any additional clarification or information necessary to the preparation of their individual responses. Telephone questions to individuals within the City are not encouraged, but will be permitted, with the g�AJjgjt_)?tgyl8g that any responses thus obtained are not binding on the proposal process or upon the award of the contract. 4. ZQbQ9M1s1 11-5-87 Proposal Conference - 10:00 a.m., Room 103 City Hall Committee Room 11-19-87 All proposals must be in the hands of the City Purchasing Department no later than 2:00 p.m. Request for Proposal for Banking Services Page 2 12-17-87 The City Council will consider award of the contract Not later than Anticipated implementation date for contract June 1, 1988 5. WQgt14Il_9L1tPr1A1 The following criteria will be used to evaluate proposal responses and to make a recommendation for award to the City Council: a. The completeness of the response to all required items on the standardized proposal forms. b. The aggregate total cost of banking services. C. The proposed earnings rate on overnight cash balances. d. The experience and continuity of the bank officials who are identified as primary contact personnel. e. Responses from references. f. Convenience of Banking Services. ��QeE_QE�E6N1511�G:.&EBx1�E� The City's main operating account covers a broad variety of activities. Several of the City's departments are responsible for their own deposits, and require a 24-hour deposit capability for their collections. Deposits will be made by either City employees or a security service. All deposits will be accompanied by duplicate or triplicate deposit slips. Upon verification of the deposit, a copy of the deposit slip must be acknowledged by the bank and returned to the City Accounting office in the Accounting Department bank bag on the following day. An appropriate supply of padded, triplicate or duplicate deposit slips, coin wrappers, coin envelopes, and a locking bank bags will be furnished by the bank at no charge to the City. Should deposited checks be returned because of insufficient funds (or any other reason), one attempt will be made by the bank to redeposit the check, after which the check and charge - back slip will be sent to the City's collection agency for processing. The City writes approximately 1,600 checks per month on the General Fund account and makes approximately 725 deposits per month to this account. Request for Proposal for Banking Services Page 3 The bank must have the capability of receiving wire transfers from local, state, and federal governments for items such as Community Development Block Grants and Lubbock County Appraisal District receipts. The estimated average daily balance in the operating account will be approximately $3,000,000. 2• P_i�YLgll_6ggQgDf�= The City is currently on a bl-weekly payroll basis, paying an average of 1,800 employees every other Friday. The net payroll amounts to approximately $950,000 per pay period. In December of each year, some employees are paid an additional check for longevity. In December of 1986, the City paid out approximately $485,000 to 1,250 employees. The City will not deposit funds to the payroll account. Instead, the bank will operate a "zero balance account", to which funds are automatically transferred from the General Fund account as payroll checks are presented to the bank for payment. Although the City does not currently utilize a direct deposit system for payroll, the City is anticipating initiation of this service and the bank's ability to provide this system Is desirable. The ability to provide Direct Deposit into banks of the employee's choosing is preferable. The bidder must provide a description of the facilities available for providing direct deposit. Please state all requirements such as lead time, etc. 3. Qtb�>r_6��s�Df�z The City currently has five other accounts which are handled by various departments. These accounts are: Clearing Fund, Jury Account, Bond Account Utilities Refund Account, Parks and Recreation Account, and Personal Appearance Account. The City writes approximately 400 checks per month on these accounts and makes approximately 40 deposits per month to these accounts. The estimated average dally balance in these operating accounts will be approximately $500,000. All deposits presented will contain cash, endorsed and MICR encoded checks, and a check item listing including item number, item amount, and total of checks on magnetic media or paper as the depository bank may elect. The endorsement and MICR encoding shall be performed to accommodate proof standards as specified by the bidder. The City estimates the number of Items deposited to be 55,000 per month. Request for Proposal for Banking Services Page 4 5. agtlUtgtognta The cut-off date for statement purposes for all City accounts will be the last day of each month. Statements must be received by the city within four working days following the cut-off. The depository bank must furnish the City with a magnetic computer tape for the General Fund account and payroll account. The magnetic computer tape shall be 2400 ft. reel 1600 B.P.I. and shall include these Items for the statement period - item number, item amount, item date, and total amount of all checks. This tape listing of Bank item processing will be matched against a computer generated item listing and a returned item listing to reconcile the City accounts. Checks are to be arranged in numerical order prior to their return to the City with the statements. A statement must be furnished for ail special accounts required by the City on the same schedule as required of the General Fund. The City reserves the right to add additional accounts as necessary. in addition to regular statements, the bank must provide gp11x balance reporting information regarding all accounts as required by City Finance personnel. 6. 1nY'Q;;tmgnti. The bank will handle the purchase of liquidation of investments only upon instruction by the Director of Finance of the City of Lubbock or his designee. Investment transactions must be consumated on the same day that instructions are received from authorized City personnel, or on the next business day if so instructed. Failure to consumate investments on a timely basis will constitute a breach of contract, and will constitute cause for immediate cancellation of the contract, or legal action for damage, or both. Upon maturity or liquidation of an investment, written notification will be sent to the Director of Finance or his designee showing the deposit of the proceeds. The same type of written notification will be required for all purchases of investments handled through the bank, whether purchased by check, wire transfer, electronic debit, etc. These notifications will be mailed on the same day that the transactions occur. The bank shall provide safekeeping facilities for investments owned by the City, an alternate method will be considered as long as an acceptable audit trail is established. A copy of all safekeeping receipts will be issued to the City at the consumation of each Investment transaction. Request for Proposal for Banking Services Page 5 7. ��i>3tx_QaR4�lt_�Q��s� The bank shall provide safety storage of registered bonds, exceptional security. 8. �cg�A_$&�4g13t3 deposit boxes as needed for the coupons, or other material requiring At the close of each business day, all collected balances (in all City accounts) will be transferred to a special investment account, called a Sweep Account. The total collected balances will then be Invested In a repurchase agreement at the bank, backed by U.S. Government securities whose total current market value is equal to at least 105% of the total amount Invested. Simultaneously, the bank will issue a safekeeping receipt for the specific securities sold to the City under the terms of the repurchase agreement, evidencing clear ownerships of the securities by the City. Such evidence of ownership is subject to the examination and approval by the City, and the lack of satisfactory evidence of ownership and sufficiency of market value shall constitute breach of this contract. The bank selected to perform this contract shall be required to maintain a sufficient portfolio of U.S. Government securities to enable It to meet the sweep account requirements on a daily basis. Although the City anticipates an average daily balance of approximately $3,000,000, variances In daily balances will require that the bank have the capability of providing sufficient securities to accept deposit totals of up to $6,000,000. At the beginning of the next business day, all balances in the sweep account shall be transferred back into the City's accounts. Written notification of Interest earned will be given to the City. In addition, monthly statements will be forwarded with the Clty's regular bank statement, outlining the details of sweep account earnings for the period. The payment to the City will be the net amount of the interest earned on the sweep account minus the charges for banking services for all City accounts. Payment to the City will be made on or before the second working day following the last day of each month. All interest earnings will be computed in strict accordance with the negotiated rate which was agreed to in the contract for banking services. This negotiated rate shall be stated by prospective bidders as a fixed weekly rate which bears a direct relationship to the "average weekly Fed Funds Rate", which is published in the Tuesday (or Wednesday) addition of the ftjj Lggf_�4btfl�1 every week. The rate bid by the bank will be quoted in decimal points, such as "The average Fed Funds rate, Request for Proposal for Banking Services Page 6 @jpME .35%", (35 "basis points"), "The average Fed Funds rate, gIME .10%", "The average Fed Funds rate minus 1.00%", etc. In no case will the City accept another source for computation of the weekly Fed Funds rate. One of the major advantages of such an arrangement (the "sweep account") is the manner In which bank reserve requirements are eliminated, allowing full investment of 1211, rather than merely ggr±JgD of the City's daily collected balances. This advantage stems from the provisions of the Federal Reserve's Board's Regulation D, 12C.F.R., paragraph 204.2 (a) (1) (vii) (B), which defines such balances as exceptions to the definition of reservable deposits. 9• P.;�xmgnt_f4L_��LYjgg�= All account charges will be Itemized on a monthly basis, and remitted with the regular monthly statements. Following the City's opportunity to review the charges, and reconcile any differences or errors, the bank will receive payment for such charges in excess of sweep account earnings on the 15th of each month. 10. LLnc_Q1_.QLg4.1f: The bank shall honor all overdrafts of the City to an amount not exceeding $3,000,000 and Bank may elect to honor overdrafts exceeding $3,000,000 (overdrafts as used in this paragraph shall mean that the City does not have a compensating balance in other City funds or accounts equaling or exceeding overdrafts in a City fund or account). The bank will charge the City a rate of interest in strict accordance with the negotiated rate which was agreed to in the contract for banking services. This negotiated rate shall be stated by prospective bidders as a fixed rate which bears a direct relationship to the "average weekly Fed Funds Rate", which is published in the }j�jj_�fL�gf_�!gllLOt�l each week. Over drafts will be considered temporary, unless they exceed ten (10) calendar days, at which time the over drafts will be cleared. Loans, when requested by City, will be made to the City to an amount not to exceed $3,000,000. On any loan in excess of $3,000,000, the bank shall have full discretion on whether or not to grant such loan and will notify the City as soon as possible of its decision in this regard. Loans are to be direct indebtedness of the City of Lubbock to be made within each fiscal year of the City and not intended for long-term indebtedness. The bank will charge the City a rate of interest in strict accordance with the negotiated rate which is agreed to in the contract for banking services. This negotiated rate shall be stated by prospective bidders as a fixed rate which bears a direct relationship to the "average weekly Fed Funds Rate" which Is published In the Y�i�jj_�tLBgf_�I12SiLII�l each week. Request for Proposal for Banking Services Page 7 11 • Qas.tsn;3t�9_�.�n�_S�snt��t_EQx;zQnn�1L The bank shall provide a list of contact personnel within the bank who are qualified to provide information and assistance in each area such as investments, safekeeping, bookkeeping, sweep account, etc. In addition, the bank will provide a summary of qualifications for such designated personnel, indicating position, length of service, and a brief summary of their professional experience. Such information shall be updated as designated personnel are changed over time. If, from the City's perspective, the quality or ability of the designated personnel deteriorates beyond a reasonable level, the Director of Finance may elect to cancel this agreement, or to negotiate for an acceptable change in designated personnel. 12. Bgfgt�ng�s� The bank must provide a list of names and addresses or business customers of similar size and complexity to the Cityfs requirements. In addition, each bank must attach a current statement of financial condition and income statement, plus similar statements for the preceding five years. 13. Cgntagti The City will enter into a signed contractual agreement with the bank selected as "depository bank" for a period of three years. Resolution #2706 December 17, 1987 DESIGNATION OF DEPOSITORY AND CONTRACT FOR THE CUSTODY OF THE FUNDS OF THE CITY OF LUBBOCK, TEXAS THE STATE OF TEXAS § COUNTY OF LUBBOCK § THIS CONTRACT made and entered into on this the 17th day of December , 1987, by and between AMERICAN STATE BANK, LUBBOCK, TEXAS, a Banking Corporation, acting by and through its duly authorized officers (hereinafter referred to as Bank), and THE CITY OF LUBBOCK, a Home Rule Municipal Corporation, chartered under the laws of the State of Texas, with its domicile in Lubbock County, Texas, acting herein by and through its duly au- thorized officers, (hereinafter referred to as City); WITNESSETH: The governing body of the City of Lubbock does hereby desig- nate the Bank as Depository of the City funds and the City of Lubbock has deposited, and will deposit from time to time funds of such City with Bank and Bank does hereby agree to accept such deposit or deposits; and such deposits shall be made on the fol- lowing terms and conditions: I. The term of this Contract shall be three (3) years commenc- ing on the 1st day of June, 1988, and ending on the 31st day of May, 1991. II. All funds deposited with American State Bank, Lubbock, Texas, by the City of Lubbock will be secured by U. S. Government Securities in accordance with the provisions of Vernon's Ann.Civ.Stat., Art. 2560, Sec. d. Such securities so pledged shall be approved as to kind and value by the governing body of the City of Lubbock. Bank will honor all overdrafts of the City to an amount not exceeding Three Million Dollars and Bank may elect to honor over- drafts exceeding Three Million Dollars. Bank will charge City a rate of interest, as set forth in Exhibit A attached hereto and made a part hereof, for handling any and all overdrafts. over- drafts will be considered temporary, unless they exceed ten (10) calendar days, at which time the overdrafts will be cleared. IV. Loans, when requested by City, will be made to City to an amount not to exceed Three Million Dollars. On any loan in ex- cess of Three Million Dollars, Bank shall have full discretion on whether or not to grant such loan and will notify City as soon as possible of its decision in this regard. Loans are to be direct indebtedness of the City of Lubbock, to be made within each fiscal year of the City. This is not in- tended for long term indebtedness. Bank will charge City interest on all loans as set forth in Exhibit A attached hereto and made a part hereof. V. For and in consideration of the agreements contained in Ex- hibit A, Bank will furnish to City all necessary and customary banking services including, by way of illustration but not limi- tation of the following: 1. Bank will handle all foreign and domestic exchange for the City. 2. Bank parking lot facilities which are immediately adja- cent to Bank building will be available for use by the City in its transaction of banking business. 3. Bank agrees to furnish to City coin wrappers, night de- pository services including bags and keys, Cashier's checks and deposit slips. 4. Bank will furnish City a detailed monthly statement of securities pledged against City deposits as of the last business day with an aggregate total of the pledged amount. - 2 - 5. Bank will deliver to City monthly bank statements on all accounts maintained by City with Bank. 6. Bank will furnish daily balance of each account, in- cluding total collected balance. VI. The City will have the right to place any amount of its funds in any demand account or accounts maintained by City with Bank and Bank agrees to accept any amount of City funds placed in said demand deposits. VII. The City will have the right to invest any amount of its funds in the Bank at a rate set forth in Exhibit A or in any other financial institution or investment in which the City is legally authorized to invest. VIII. It is agreed by the parties hereto all time deposits or cer- tificates of deposit which have not elapsed on the termination date of this Depository Contract, shall remain on deposit with the same depository under the same terms and conditions in effect during said Contract until the date such time deposits have elapsed. IX. Notwithstanding anything to the contrary contained in this Agreement the City will be at all times free to forward funds to any bank which is serving as a paying agent for the City on bonds issued by the City. X. This Agreement is made subject to the statutes of the Congress of the United States and the State of Texas and subject to the rules and regulations promulgated by the Banking Depart- ment, State of Texas, the Board of Governors of the Federal Re- serve System, and the Board of Directors of the Federal Deposit Insurance Corporation, as are now in existence and such other statutes, rules and regulations of these entities as may here- - 3 - after become effective during the term of this Agreement; and if this Agreement should be or become in conflict with such statutes, rules and regulations then such statutes, rules and regulations shall control to the extent they are in conflict with this Agreement. EXECUTED this the day of 1987. AMERICAN STATE BANK THE CITY OF LUBBOCK &4w'- e. C .1,v S DON HUDGEONS . C. McMINN EXECUTIVE VICE PRESIDENT MAYOR ATTEST: A. l f &" d[ r� Cashier (Assistant) THE STATE OF TEXAS § COUNTY OF LUBBOCK § ATTEST: Ran tte Boyd City Secretary APPROVED AS TO FORM: Donald G. Vandiver First Assistant City Attorney BEFORE ME, the undersigned authority, a Notary Public in and for said County, Texas, on this day personally appeared B. C. McMINN, known to me to be the person whose name is subscribed to the foregoing instrument and acknowledged to me that he executed the same as the act and deed of the City of Lubbock and as Mayor, for the purposes and consideration therein express, and in the capacity therein stated. 6rVEN DER MY HAND AND SEAL OF OFFICE this day of 1987. Notary Public, —Lubbock County, Texas My Commission Expires: r MY COMMISSION EXPIRESITi NOVEMBER 30, 1989 OLIVIA R. SOLIS - 4 - THE STATE OF TEXAS § COUNTY OF LUBBOCK § BEFORE ME, the undersigned authority, a Notary Public in and for said County, Texas, on this day personally appeared DON HUDGEONS, known to me to be the person whose name is subscribed to the foregoing instrument and acknowledged to me that he exe- cuted the same as the act and deed of the American State Bank, Lubbock, Texas, and as Executive Vice President, for the purposes and consideration therein express, and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this 10th day of December 1987. _ ---------- NotaLvy Pubic, Lubbock County, Texas My Commission Expires: 3-18-88 - 5 - City of Lubbock Proposal for Banking Services from American State Bank November 19, 1987 Supporting Material Selection Criteria Item #11 Name W. R. Collier President Years at ASB 28 years Don Hudgeons 33 years Executive Vice President Bill Blackwell 15 years Sr. V. P. & Cashier Jackie Duncan 27 years Vice President Ken Kingston 6 years Vice President Selma Sedgwick 18 years Vice President Selection Criteria Item #12 Texas Tech University - Contact Robert Hall Years at Present position 13 years as President 13 years as Exec. Vice Pres. 13 years in operations 12 years as Head Bookkeeper 2 years as D. P. Manager 21 years of D. P. Experience 17 years Investments and Cash management