11-APPROVE RESOLUTION ACCEPTING BID FOR CITY DEPOSITORYItem No. 11
�nemo�andum
TO: City Council
John Godwin, City Manager
FROM: Gene Anderson, Finance Director
SUBJECT: CITY DEPOSITORY
DATE: January 8, 2013
BACKGROLJND: Under Chapters 105 and 131 of the Local Government Code, the City of
Paris may receive bids from financial institutions to serve as the depository and custodian of the
City's funds. The City historically has operated under two year agreements. The current
depository agreement expires February 28, 2013. In order to allow time for transition should the
depository bank change, the City Council votes on this issue in January every third year.
STATUS OF ISSUE: The City advertised in the Paris News on December 9 and December 16 of
2012 that it would be receiving bids to serve as the City's depository bank for a two year period
beginning March 1, 2013. In addition, email notification was sent to five local banks who have
expressed interest in this issue in the past. Attached is a bid summary showing that the Liberty
National bid is the best proposal. Not only are their bids based on the higher 26 week T-bill rate,
but their basis point add on is also higher. Copies of the bids are also provided.
BUDGET: Not affected by this selection.
RECOMMENDATION: Motion to select Liberty National Bank to serve as the City of Paris
depository bank for the ensuing two year period.
Draft
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS,
ACCEPTING THE BID FROM LIBERTY NATIONAL BANK, PARIS, TEXAS TO
PROVIDE CITY DEPOSITORY SERVICES FOR THE PERIOD BEGINNING MARCH
1, 2013 AND ENDING FEBRUARY 28, 2015; AUTHORIZING THE EXECUTION OF
A DEPOSITORY SERVICES AGREEEMENT WITH LIBERTY NATIONAL BANK;
MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND
PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City of Paris, Texas, did heretofore advertise for bids in accordance with
the laws of the State of Texas and the Charter of the City of Paris for a City Depository for the
period beginning March 1, 2013, and ending February 28, 2015, which bids were received until
3:00 o'clock P.M., Monday, January 7, 2013; and,
WHEREAS, the best bid for City Depository was made by Liberty National Bank in Paris,
and it should be awarded the contract for such depository;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PARIS, TEXAS:
Section 1. That the findings set out in the preamble to this resolution are hereby in all
things approved.
Section 2. That the bid of the Liberty National Bank. Paris, Texas to act as City Depository
for the period beginning March 1, 2013, and ending February 28, 2015, be, and the same is
hereby, accepted.
Section 3. That the Mayor be, and he is hereby, authorized and directed to execute, on
behalf of the City of Paris, a depository services agreement with Liberty National Bank, Paris,
Texas to act as City Depository for the City of Paris upon the terms and conditions set out in that
institution's bid, attached hereto as Exhibit "A" and the Depository Services Agreement to be
executed by the Parties.
Section 4. That this resolution shall be effective from and after its date of passage.
PASSED AND APPROVED this 28th day of January, 2013.
A.J. Hashmi, M.D., Mayor
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent McIlyar, City Attorney
NOTYCE TO BANKING INSTITUTIONS WITHIN THE CTTY OF PARIS
Noticc is hereby given tl�at Governing Body of tbe City of Paris, subject ta the grovision of
Chapters 105 and 131 of the Texas Local Govcmment Code, wiA receivc bids and applications
from 811 iaterested banking institurions withia the Ciry of Paris to serve as pdme depository of
the City of Paris and maintain custody of the funds of the City for a period of two ycars from
March 1, �013 through February 28. 201 S. Any such application shall be delivered to the oiiice
of the City Manager located in City Hall prior to 3:00 P. M.� Friday January 7, 2013.
It is rcyuiced that each benk bid by filling in ail blanks and agreeing to the following
spuifications:
Bank wi11 pay to City interest on time dcposits in accordance with the following schedule:
MATURITY
7-13 days
l 429 days
30-59 days
60-89 days
90-179 days
t 80-365 days
7-13 days
1429 days
30-59 days
60-89 days
90-179 days
180-3b5 days
CF.RTIFICATES �F DEPO5IT UNDER $100�000
RATE
T bitl plus ar minus � basis points
T-bill plus or minus o-- basis points
T-bill plus or minus 10 basis points
'T-bill plus or minus �_ basis points
T bill plus ar minus 30 basis points
T-bill ptus or minus 45 basis points
CERTIFICATES OF DEPOSIT OVER $100�000
T bill plus or minus o basis points
T bill plus or minus o basis points
T-bill plus or minus 10 basis points
T-bill plus or minus 20 basis points
T-bill plus or minus 30 basis points
T bill plus or minus 45 basis points
All investment services offered to other bank customcrs wi11 be available ta tt�c City.
The City will ucce�t bids oniy oa the basis herein at�er described.
Each day, the Wall Street Journal publishes the 26 week tressury-bilI yield based on the results of
the most recent treasury-bif! suction. Rates for certificates of deposit undcr this contract must bc
tied tv this 26 week treasury-bill yield. The rates should bc quoted dther plus or minus a given
number of besis points from this 26 wcek treasury-bill yield. Using the Wal l Strcct Joumal deted
tbe same dey as the certificete of deposit is purchased, the certificate of deposit rate will be the
26 weck T-bill retc published that day in the Watl Street Journal plus or minus the basis points
listcd above.
t` �'
EXHIBIi �
CHARGES
List below any serv3ce charges that will be levied sgain�t the City:
NONE
In addidon to the normal services and supplies furnished by the depository banlc, ti�e following
services are standerd and common to most depository contracts. They are to be fiirnished to the
City at no charge:
deposit slips
one large safe deposit box
coin wrappers
night depository service including bags and keys
travelor's and cashier's checks
daily balance on each accour�t
money arders
stop paymcnt orders
wire scrvices
checking and savings accounts
all bank accounts will be interest bearing accounts
on line banking
overdrafl protcction
Bidders are requested to submit a list of any furiher conccssl�ns or services in the spsce pravidod
below which they may want ta affer to thc City of Paris and makc any comment as fwther
consideration in selecrin8 the City's dcpository. If necded, please add additional pages.
Bank will pay interest on the City's Consolidated Caeh Account at a rate equivalent to the
auction xate for 2b-week Treasury Bills plus 30 basis points. The rate will be changed
each calender quarter and will b� calculated ueing the moet recent Treasury Bill auction.
Using the awst recent Treasury Bill auction a rate of .43% wouid result.
Upon notification to Bank, the City of Paria would have the option to bring other City
transaction accounts under a rate plan paying the auction rate for 26-week Treasury Bills
plus 1Q basis points.
Using the most recent Treasury $ill auction a rate of .23Z would result.
Bank will origlnate
will furniBh to City
of each transaction
City's ACH payments, both debits and credits, without charge. Bank
without charge at the end of each year CD's containing a aummary
account activity
All monies which are deposited into the depositary undcr the provisions of this proposal shall be
cairtinuously secured, in accordance with the laws of the State of Texas appticable thereto, by a
valid pledge af par, exclusive of accrued interest, at all times ai least equal to 1 Q2% of the
amount of moncy on deposit in said several funds on deposit in tl�e depository.
All time deposits or certificates of deposits which have not elapsed on the terrniaation date of the
finally approved depository contract, sha!! �emain on deposit with the same depository under the
same terms and eonditions in effect during said contract unti} the date such time dcposits hsve
elapsed, Funds from Bond salcs may be deposited in the City depository or placed in ouaide
investments.
The City of Paris reserves the right to accept or reject any or all bids, to waive formalities, end to
accept the bid the Ciry considers the most advantageous. The City aiso reserves the right to place
or invest part or all of its surplus or exczss funds outside the designated depositary, in any
manner permitted by law, firom time to time througttout the term of the contract,
The undersigned bank officiai represents that he is authorized by the Bank's Board of Directors
to sign this documcnt and legally obligate ti�e Bank to the tcrms stated in this agreemcnl.
NAME OF aANK Liberty National Bank
BY: I � , �
P ilip R. Cecil
T��.E: r�t,g{�gn
DATE: Jaauary 7 , 2813
Depository Agreement Comparison
Certificates of Deposit Under $300,000.
Maturitv
7-13 days
14-29 days
30-59 days
60-89 days
90-179 days
180-365 days
Rate Libertv National
26 wk T-bill plus basis points
0
0
10
20
30
45
Certificates of Deposit Over $300,000.
7-13 days
14-29 days
30-59 days
60-89 days
90-179 days
180-365 days
Service Charges
0
0
10
20
30
45
none
Rate
13 wk T-bill plus
7-29 days
Guarantv Bond
basis points
NA
0
0
15
20
25
NA
0
0
15
20
25
none
Interest rate on Consolidated Cash Account 26 wk T-bill auction rate 13 wk T-bill
+30 basis points 10 basis points
floor