12 - CITY DEPOSITORYItem No. 12
memorandum
TO: City Council
John Godwin, City Manager
FROM: Gene Anderson, Finance Director
SUBJECT: CITY DEPOSITORY
DATE: January 2, 2015
BACKGROUND: 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, 2015. 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 November 30th and December 7th
of 2014 that it would be receiving bids to serve as the City's depository bank for a two year
period beginning March 1, 2015. In addition, email notification was sent to five local banks who
have expressed interest in this issue in the past. While only Liberty National Bank submitted a
bid, Liberty's bid is more favorable to the City than the current depository contract with Liberty
Bank.
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.
NOTICE TO BANKING INSTITUTIONS WITHIN THE CITY OF PARIS
Notice is hereby given that Governing Body of the City of Paris, subject to the provision of
Chapters 105 and 131 of the Texas Local Government Code, will receive bids and applications
from all interested banking institutions within the City of Paris to serve as prime depository of
the City of Paris and maintain custody of the funds of the City for a period of two years from
March 1, 2015 through February 28, 2017. Any such application shall be delivered to the office
of the City Manager located in City Hall prior to 3:00 P. M., Friday January 2, 2015.
it is required that each bank bid by filling in all blanks and agreeing to the following
specifications:
Bank will pay to City interest on time deposits in accordance with the following schedule:
CERTIFICATES OF DEPOSIT UNDER $100,000
MATURITY
RATE
-0- basis points
14 -29 days
7 -13 days
T -bill plus or minus
-0-
basis points
14 -29 days
T -bill plus or minus
-0-
basis points
30 -59 days
T -bill plus or =h=
20
basis points
60 -89 days
T -bill plus or>s
30
basis points
90 -179 days
T -bill plus ors
4o
basis points
180 -365 days
T -bill plus ors
5o
basis points
CERTIFICATES OF DEPOSIT OVER $100,000
7 -13 days
T -bill plus or minus
-0- basis points
14 -29 days
T -bill plus or minus
-0- basis points
30 -59 days
T -bill plus or rAm
25 basis points
60 -89 days
T -bill plus or mj=
35 basis points
90 -179 days
T -bill plus or nvhm
45 basis points
180 -365 days
T -bill plus or mamma
55 basis points
All investment services offered to other bank customers will be available to the City.
The City will accept bids only on the basis herein after described.
Each day, the Wall Street Journal publishes the 26 week treasury-bill yield based on the results of
the most recent treasury-bill auction. Rates for certificates of deposit under this contract must be
tied to this 26 week treasury -bill yield. The rates should be quoted either plus or minus a given
number of basis points from this 26 week treasury-bill yield. Using the Wall Street Journal dated
the same day as the certificate of deposit is purchased, the certificate of deposit rate will be the
26 week T -bill rate published that day in the Wall Street Journal plus or minus the basis points
listed above.
CHARGES
List below any service charges that will be levied against the City:
In addition to the normal services and supplies furnished by the depository bank, the following
services are standard and common to most depository contracts. They are to be furnished to the
City at no charge:
deposit slips
one large safe deposit box
coin wrappers
night depository service including bags and keys
traveler's and cashier's checks
daily balance on each account
money orders
stop payment orders
wire services
checking and savings accounts
all bank accounts will be interest bearing accounts
on line banking
overdraft protection
Bidders are requested to submit a list of any further concessions or services in the space provided
below which they may want to offer to the City of Paris and make any comment as further
consideration in selecting the City's depository. If needed, please add additional pages.
The bank will pay interest on the City's Consolidated Cash Account at a rate
equivalent to the auction rate for 26 -week treasury bills plus 41 basis points. The
rate will be changed each calendar quarter and will be calculated using the most recent
treasury bill auction.
Using the most recent treasury bill auction a rate of .56% would result.
Upon notification to Bank,-the City of Paris would have the option to bring other City
transaction accounts under a rate plan paying the auction rate for 26 -week treasury
bills plus 15 basis points.
Using the most recent treasury bill auction a rate of .30% would result.
Bank will originate City's ACH payments, both debits and credits, without charge. Bank
will furnish to city without charge at the end of each year CD's containing a summary
of each transaction account activity.
All monies which are deposited into the depository under the provisions of this proposal shall be
continuously secured, in accordance with the laws of the State of Texas applicable thereto, by a
valid pledge of par, exclusive of accrued interest, at all times at least equal to 102% of the
amount of money on deposit in said several funds on deposit in the depository.
All time deposits or certificates of deposits which have not elapsed on the termination date of the
finally approved 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. Funds from Bond sales may be deposited in the City depository or placed in outside
investments.
The City of Paris reserves the right to accept or reject any or all bids, to waive formalities, and to
accept the bid the City considers the most advantageous. The City also reserves the right to place
or invest part or all of its surplus or excess funds outside the designated depository, in any
manner permitted by law, from time to time throughout the term of the contract.
The undersigned bank official represents that he is authorized by the Bank's Board of Directors
to sign this document and legally obligate the Bank to the terms stated in this agreement.
NAME OF B,
The Liberty National Bank in Paris
N_
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TITLE;
DATE: January 2, 2015