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Home My WebLink About2002 01 28 Consent H Bank of America COMMISSION AGENDA ITEM H CONSENT XX INFORMATIONAL PUBLIC HEARING REGULAR .lannal'}' 2R) 2002 Meeting MGR ;v-tDEPT ~ A lIthori zMi on REQUEST: The Finance Department requesting the Commission approve the continuance of our banking relationship with Bank of America. PURPOSE: The purpose of this Agenda Item is to gain Commission approval for continued banking relations with Bank of America as opposed to going out for RFP. CONSIDERATIONS: . At the August 27, 2001 Commission meeting, our Banking and Treasury Consultant, Steve Alexander with Public Financial Management was directed to perform a benchmarking analysis of banking interest rates and fees and enter into negotiations with Bank of America to obtain higher interest rates and lower fees if possible as opposed to going out for a formal RFP. . That analysis was performed and based on the outcome of the banking negotiations, Mr. Alexander is recommending that we move forward with formalizing our banking arrangement with Bank of America. . Based on the new bank account and overnight investment structure, Mr. Alexander estimates projected annual savings of $96k. FUNDING: N/A ATTACHMENTS: . Recommendation letter from Steve Alexander, Public Financial Management . Service fee comparison chart - existing fees and proposed fees RECOMMENDATION: The Finance Department recommends that the Commission approve the continuance of our banking relationship with Bank of America and move forward with formalizing the arrangement. :NOI.L~V NOISSIWli\IO~ c0"d %66 [cD 8\79 60\7 tt:ct c00c-8t-N~f .......- -- t:= PFM Suite 720 201 South Orange Avenue Orlando,FL 32801-3470 407 648-2208 407648.1323 fax www.pfm.com -- ~ Public Financial Management Financial and Investment Advisors January 18.2002 Ms. Louise C. Frangoul, CPA Director of Finance City of Winter Springs 1126 East State Road 434 Winter Springs. Florida 32708 Re: Banking Services Fees Dear Ms. Frangoul: Public Financial Management ("PFM") is submitting this report on the general banking service fees as a follow-up to our pervious discussions and meetings with the City Winter Springs' ("City") bank (Bank of America). We have reviewed both the new proposed bank fees and average market bank fees for a similar size organization. We have determined the following: 1) The proposed fees are comparable to average market fees for a similar size organization receiving like services. Therefore. a request for banking services (uRFP") will not be necessary at this time. 2) The dollar savings generated by the new bank account and overnight investment structure. as proposed by PFM and adopted by the City Commission. is expected to be approximately $96,000 annually. The savings are generated from the following modifications. Source Reduction in annual bank fees Amount $14.029 Overnight sweep investment rate increased by 10 basis points (Federal funds less 40 basis points as compared to the current rate of Federal funds less 50 basis poinls) based on $1 million invested daily with the bank. 10.000 Transfer the City's cash from the bank's overnight sweep investment account (Federal Funds less 40 ba~is points) to the Florida State Board of Administration's f'SBN').d .... d money market account (Federal Funds rate) based on $18 million. 72.000 The combined projected annual savings for the City is approximately. $96.029 The banking services fee analysis is attached for your review. even Alexander, tCM Senior Managing Consultant City of Winter Springs Bank Prices and Services Chart ~~n~/~og I MonthlY I Monthly Monthly Average Average! Average Unit Service Estimated Unit Service Service Market Proposed Banking Services ServIces Charge Fee Services Charge Pee Fee Savings Feel Fe:s ~ " . ~ la? , . ., . . " :o;r~i - .. ~'lC.' .~ " ~ . a.. .Q1J ^. .: '. . .. - .. ..:r FDIC - per 51.000 end of month ledger balancc - this char~ is subiect to cban<>c and it is currently .014 18,078,214 0.014 236.70 1,000,000.00 0.01 14.30 222.40 0.01 0.01 Account Maintenance 42 15.00 630.00 3.00 10.00 30.00 600.00 15.00 16.00 Deposits Credited (includes Branch OTC (over the counter) deposils, QBD (quick business deposi1s), Iltm Processing deoosih etc. 163 0.45 73.35 101.00 0.40 40.40 32.95 0.33 -7.07 Non-Cash/Cash Denosit Correction 1 5 5.00 2.00 5.00 10.00 -5.00 5.00 0.00 Debits (checks oaid)' 1086 0.16 173.76 944.00 0.13 122.72 51.04 0.15 18.88 Zero Balance Account Master - Monthly Maintenance 1 SO 50 1.00 50.00 50.00 0.00 30.00 -20.00 Zero Balance Account Master - Sub Account Maintenance 2 20 40 2.00 25.00 50.00 -10.00 15.00 -20.00 Retwn Items 16 5 80 10.00 4.50 45.00 35.00 4.50 0.00 Return Items Reeleared 34 5 170 25.00 5.50 137.50 32.50 5.50 0.00 Dcnositcd Items - blended rate (Dcr item) - unencoded 89 0.1 I 9.79 36.00 0.09 3.24 6.55 0.08 -0.36 Dcnositcd Items - Encoded OnUs 3689 0.045 166.005 2,158.00 0.05 97.11 68.90 0.08 75.53 Local Clearin<>house 4741 0.055 260.755 3,198.00 0.05 172.69 88.06 0.08 83.15 Other - In Districl Fed 2600 0.07 182 1317.00 0.07 8956 92.44 0.08 15.80 All Other 1032 0.09 92.88 686.00 0.09 61.74 31.14 0.08 -6.86 EncodinlZ Charlle 235 0 0 677 .00 No Charee 0.00 0.00 No Charl!e 0.00 Encoded Items - Rejects UD 10 1 % 11 0.25 2.75 8.00 0.25 2.00 0.75 023 -0.16 Stan Pay 12 Months 0 LOO 12.00 12.00 -12.00 12.00 0.00 Manual Stop Pa ment 2 29 58 29.00 0.00 58.00 30.00 0.00 EIoctronic"( ACH Debits received 6 0.15 0.9 4.00 0.13 0.52 0.38 0.12 -0.04 Eloctronic (ACH Credits received 3 0.15 0.45 5.00 0.13 0.65 -0.20 0.01 -0.59 - ~- "'~~'I'~. " " ~'" .. , : II!. . .~ .~1:f~;!;"~~1~ , .,. > .. QBD (Quick Business Dcposit)/Night Drop -Cash Processed ner SIOO 451 0.08 36.08 272.00 0.08 21.76 14.32 0.08 0.00 Banking Center Deposit - Immediate Verificarion -Per SIOO 104 0.16 16.64 23.00 0.08 1.84 14.80 0.08 0.00 VaultDeoosit- Per S100 19 2 38 29.00 0.08 2.32 35.68 0.08 0.00 NilZhl DeOOsit - Non.Standard Ball 53 5 265 32.00 5.00 160.00 105.00 4.50 .16.00 ACH ConsumerMaintenance-Pcr Month 1 IS 15 1.00 15.00 15.00 0.00 15.00 0.00 Consumer one-dav credit/debit 256 0.15 38.4 0.00 0.15 0.00 38.40 0.13 0.00 Consumer two-day credit/debit 0 302.00 0.10 30.20 .30.20 0.10 0.00 Consumer input transmission - Del transmission 2 20 40 2.00 15.00 30.00 10.00 15.00 0.00 .- : Ilt! ... If.,...... .... .... .. F ~. t'!. ~1;~~,i , ~. .. .~ .~~, .... -"'~ ... ..~. g . ~ .. ...r:'. .' ". '. .. ... 1. ~ "'" .,. .,,~ ,. .. ;;,"~" ~.. .;r ...':1 .. Check Sort - Monlhly Account Maintenance - to be - renlaced bv PerfectView CD ROM 3 15 45 15.00 0.00 45.00 15.00 0.00 Check Sort - Per Item - to be replaced by PcrfectView CD ROM 1067 0.03 32.01 om 0.00 32.01 0.01 0.00 Public Financial Management 1/1812002 Page 1 . n IS) a. ~ l'- (J) n (\J n .-1 CD '<J \1l l'- IS) '<J .-1 .-1 (\J .-1 (\J IS) IS) (\J I CD .-1 I Z ([ >-, City of Winter Springs Bank Prices and Services Chart Current Fees Proposed Fees Difference/Savings ~ ISI CL 0.00 2.00 25.00 50.00 -50.00 30.00 10.00 0.00 944.00 0.04 37.76 -37.76 0.03 -9.44 0.00 \.00 10.00 10.00 -10.00 15.00 5.00 0.00 2.00 60.00 120.00 -120.00 55.00 -10.00 0.00 1.00 20.00 20.00 -20.00 15.00 -5.00 ~ 0.00 944.00 0.06 56.64 -56.64 0.05 -9.44 ('- 0.00 en _~R___ 'fi".~ -.Yr",,!t ~: ~ .'$ ,..". '.~ . ~'~,~mp' '.. . _ ;1,. ~ . ':!... ..~ ~~t+:l~~ .~~=; 0.00 1.00 65.00 65.00 -65.00 -5.00 0.00 ] 12.00 0.10 11.20 -11.20 -1.12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 3 20.00 60.00 -60.00 20.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1'1 0.00 0.00 0.00 0.00 (\J 1'1 0.00 0.00 0.00 0.00 ..--I " . -;- ,,; ~ .~ _it':'~.~,' , .~~~~ ' ...: !Ii '., 'Ni-~ CD . .' .., d' ., .. ..'l<'J. -i'" 'j; ~ 0.00 2 8.00 16.00 -16.00 8.00 0.00 Ul 0.00 0.00 0.00 0.00 ('- 2 15 30.00 0.00 30.00 0.00 ISI ~ , 0.00 0.00 0.00 0.00 1 , 2 10 20.00 0.00 20.00 0.00 .. 0.00 0.00 0.00 0.00 4 2 8.00 2 2.00 4.00 4.00 2.00 0.00 0.00 0.00 0.00 0.00 , 0.00 0.00 0.00 0.00 " 0.00 0.00 0.00 0.00 ] 0.00 0.00 0.00 0.00 0.00 0.00 0,00 0.00 -l Monlhly FeealOllferencss . Salllngs $2.820.3 I $1,651.15 $1.169.16 ~ ..--I , ..--I 'i Annual FeeaJDlfference. .. Saving. $33,843.72 $19,813.78 $14,029.94 $1,347.60 (\J -l ..--I 'i (\J ISI :> ISI "- (\J 0 I -1 CD "- ..--I -1 I :> Z a: I-, PUblic Financial Management 1/18/2002 Page 2 Estimated