City of Seaside, Oregon. Request for Proposal (RFP) Banking Services

Transcription

1 City of Seaside, Oregon Request for Proposal (RFP) Banking Services Date of Issuance: December 3, 2009 Proposals are Due: January 29, 2010

2 City of Seaside 989 Broadway Seaside, OR REQUEST FOR PROPOSAL TABLE OF CONTENTS Introduction Page 3 City Banking Procedures Page 4 Banking Services Proposal Instructions Page 6 Required Banking Services Page 7 Optional Banking Services Page 11 Conditions Qualifying A Bank to Propose Page 12 Other Instructions Page 14 Schedule for Selection and Award of Contract Page 15 Evaluation Criteria Page 16 Proposal Response Format Page 17 Pricing Matrix (Excel Spreadsheet) Merchant Bankcard Activity (Excel Spreadsheet) Local Government Investment Account History (Excel Spreadsheet) Exhibit A Exhibit B Exhibit C Page 2

3 REQUEST FOR PROPOSAL (RFP) FOR BANKING SERVICES INTRODUCTION The City of Seaside, Oregon, through the Business Office is requesting proposals for banking services for a period of not less than three (3) years and which will provide for two (2) oneyear extensions. The purpose of this process is to obtain high quality requisite depository and banking services at a competitive price that will consolidate the bulk of our needs. A Microsoft Word version of this RFP plus three (3) Excel documents, containing historical City information, is available electronically. Interested parties obtain the RFP from the City s website at cityofseaside.us. Interested banks may attend a pre-proposal meeting or submit a letter of interest, including name and contact information of the bank s representative, or both. The meeting is scheduled for 10:00 a.m., December 18th, at City Hall. The letter of interest must be received by the day of the meeting to be considered. The purpose of the meeting will be to answer any questions arising from this document. Question not resolved at the time of the meeting plus any clarifications arising from subsequent questions deemed pertinent to everyone else will be provided via to all interested parties as needed up until January 15th. No further questions will be entertained after that date. The deadline for submitting proposals is no later than 3:00 pm on January 29, Proposals must address all of the items listed in this request for proposal and be submitted in a sealed envelope marked Banking Services Proposal and be addressed to: City of Seaside Attention: Al Peinhardt 989 Broadway Seaside, Oregon OR Contact telephone number: Please include one original and three copies of the proposal. No proposals will be accepted via fax or . The City reserves the right to reject any and all proposals, to waive irregularities, to retain all proposals submitted and to use any idea in a proposal regardless of whether that proposal is selected, and to cancel this request for proposal if the City determines doing so would be in the public interest. Page 3

4 CITY BANKING PROCEDURES The City is a full service municipality, providing its citizens with police & volunteer fire services, municipal court, library, visitor s bureau, planning and building permits, public works, water/sewer services, convention center, and general governmental services. There are approximately 84 people employed by the City. The City uses a pooled cash method of accounting, whereby cash from all governmental, proprietary and fiduciary funds is combined to maximize its earnings potential. An adequate cash balance is maintained in the Oregon State Treasury s Local Government Investment Pool (the LGIP ) to meet short-term requirements. This fund is also used as a depository for intergovernmental tax receipts from the State and County. Investments are regulated by Oregon Revised Statutes. Electronic transfers are made to and from the LGIP to meet immediate cash needs and maximize earnings. The City utilizes a main depository account for the deposits of monies collected and three disbursement accounts that are utilized for employee payroll related disbursements, vendor payments, and municipal court matters. The City s software allows for laser printed checks on blank check stock for processing vendor payments. All employee payroll disbursements are made via direct deposit. Water and sewer services are invoiced every other month. Billings amount to $3.2 million per year. About 10% of billings are remitted via ACH, about 3% via credit card, with the remainder via checks and cash mailed in or over the counter. The overwhelming majority of the checks are received through the mail. We are very interested in instituting a lockbox method for these receipts to improve our cash management efficiency. Daily deposits of cash and checks prepared by the Business Office are physically deposited into its depository account each afternoon. Also, the municipal court makes deposits four or five times per month into its account maintained with the vendor payment account. To facilitate such deposits, depository facilities will need to be located in Seaside. We also maintain petty cash funds at various departments across the City to facilitate cash payments made at the counter and for minor purchases. The City is interested in opportunities to improve operational and cash management efficiencies. One service we want to explore is the use of debit cards by a limited number of employees to ease purchase of incidentals and for use on City business travel. Such a service would have to provide accountability and ease of review for appropriateness of expenditures. Other products we are interested in are check protection ( Positive Pay ) services, ACH filter blocks, automated account reconciliation for our checking accounts, account management and transfers via online banking, plus other features not mentioned here. Please see Exhibits A and B for additional details that need to be addressed in proposals. Page 4

5 The City has historically retained most of the collected deposits in the LGIP account to maximize interest earnings. In reaction to the credit crisis that unfolded in 2008, the LGIP has reduced its risk profile and, accordingly, also the returns on funds maintained there. We are interested in augmenting this account with another investment mechanism that would provide a higher but still prudent yield suitable for a municipality. For obvious reasons the financial strength and stability the chosen banking partner will be important, especially if we move some of our short term investments there. We also utilize corporate trust services to manage the various debt issues. The City and the Seaside Urban Renewal Agency have about $12.5 million that must be serviced. While it would be preferable to make this function work with our regular disbursement account, we are not making this a proposal requirement. The City will look to its bank for creativity, expertise, and flexibility. An important consideration will be banks who maintain a local management presence that can be quickly and easily accessed should matters arise. This will be crucial during the first few months of transition but will also be important beyond that period. Finally, we recognize that today s low-interest rate environment could completely change during the course of the contract. We want to clearly understand the effects, if any, the dynamics of such a change on the contract. Page 5

6 BANKING SERVICES PROPOSAL INSTRUCTIONS Your response to the City s RFP must follow the enclosed Proposal Response Format, in the exact order listed. The banking services the City has identified for inclusion in the RFP include: (A) Required Banking Services (B) Optional Banking Services and (C) Conditions Qualifying a Bank to Propose. Additionally, other information is requested under the heading (D) Other Instructions. Any proposal that does not address or cannot provide all of the required banking services elements or conditions qualifying a bank to propose, or does not provide the information requested in other instructions, may be excluded from consideration unless the deviations are considered immaterial by the selection committee. The selection committee is comprised of three (3) staff members from the City s business office; the Finance Director, City Manager, and Accountant. All bids are considered public records subject to disclosure to the extent that any information contained within the proposal is not exempt under Oregon Public Records Law. The Applicant must specifically identify in the proposal what information, if any, is considered exempt and Applicant shall assume all responsibilities for such defense. The City will endeavor not to disclose such information to the extent allowed under Oregon law. Pricing is not considered proprietary information and is not confidential in nature. Should there be any changes or significant clarifications made to the RFP, a written addendum will be provided to all parties and will include any required adjustments in schedule dates. This addendum will be ed to those identified. Page 6

7 A. REQUIRED BANKING A1. A single depository account with three zero-balance disbursement sweep accounts for Payroll and Accounts Payable. General Account - maintained for deposits and sweep activity. (Depository) (Indicate minimum balance required for sweep account) Payroll Checking - maintained for payroll payments, which are disbursed monthly. (sweep - zero balance account) Accounts Payable - maintained for vendor payments, which are disbursed weekly. Checking (sweep - zero balance account) A2. The Municipal Court account would stand by itself but subject to the same signatory control and contract pricing. Municipal Court - maintained for court payments, which are disbursed daily. Checking/Depository (no sweep, non-zero balance account) A3. Direct Deposit of City Payroll - Describe the pricing and procedures you propose for direct deposit of City payroll. Briefly include pre-noting details, direct transmission format requirements, timing requirements of data exchange, and other details you consider relevant. Data is currently being transmitted by the City on approximately 90 employees utilizing a text (.txt) file format with a cutoff time of transmittal by 2:00 pm for credit the following day at midnight to individual employees accounts. Can you meet this same cutoff time for transmittal of data or if not, what is the earliest cutoff time you require? A4. Check protection ( Positive Pay ) services for Payroll, Accounts Payable, and Municipal Court checking accounts. In the future there may be a need for additional accounts that require check protection ( Positive Pay ). We currently transmit the data utilizing a text (.txt) file format which matches check number, date, and amount. Please describe your ability to provide Positive Pay services, whether exceptions are managed online or via fax, and which fields in the file are matched. A5. Automated account reconciliation services (daily download through the Internet of cleared checks) for the Accounts Payable account and monthly download of the Payroll, and Municipal Court checking accounts. Data is imported utilizing a text (.txt) file format. Page 7

8 A6. Identify your bank s ability to provide filters (blocks) on outgoing ACH transactions ( Electronic Payment Authorization ). Identify costs and specifics relating to implementing EPA and the technology used in processing. A7. Merchant bankcard services - A separate Excel document, Exhibit B, is attached reflecting actual credit card activity for twelve (12) months and the departments presently accepting bankcard payments. We would be interested in consolidating these accounts for cost effectiveness without losing information needed for accounting. Describe your merchant bankcard services offered and provide a cost estimate for credit card payment processing based on the volumes supplied, either one for the entity in total, or individually by department. Including one-time set-up and equipment fees. Also, include any other fees associated with setting up bankcard machines with your bank and costs of supplies. A8. We are considering offering our employees a high deductible medical policy that would include a Health Saving Account (HSA) feature as part of our medical coverage for our employees. Important to the City will be (1) the ease of depositing the funds to employee accounts, and (2) the value the accounts provide employees, e.g., employee access to their funds, cost of the accounts, investment options, and employees ability to check the status of their accounts. A9. Automatic redeposit of returned checks a second time, if the instruments are initially dishonored due to NSF notations. NSF fees are to be assessed against the monthly analysis. Please include your charge (if any) for this item and the other costs. A10. All stop payments shall be charged against the account analysis. Describe the effective length of the request and renewals. Are stop payments necessary for issued checks with a void Positive Pay in place? Stop payments should be executable on line. A11. Please state when deposits delivered to the bank by 5:00 p.m. will be given ledger credit. If there are any differentials based on where check is drawn, please disclose. Also please disclose credit timing for incoming wire transfers. A12. Full service bank branch located in Seaside or Gearhart with depository facilities. A13. Monthly checking account statements provided to the City within five (5) business days after month end. A14. Detailed daily report, available online thru the internet to the City on the next banking day by 8:00 a.m. providing the following: 1. Previous day s ending ledger balance 2. Previous day s ending collected balance 3. One and two day float Page 8

9 4. Total debits - detailed debit listing 5. Total credits - detailed credit listing 6. Zero-balance account transfer amounts 7. Previous day s invested balance of sweep or zero balance account 8. All Incoming & Outgoing electronic activity including all descriptions attached to the Incoming Ach and Fedwire payments. The City shall not be charged or penalized if an overdraft results because the account balance information is not available by the specified time. A15. Monthly account analysis statement combining the deposit, payroll, and accounts payable account clearly defining services, ledger and collected balances, credits for balances in excess of uncollected funds, and costs incurred by the City. A separate one will be needed for the municipal court account. All fees and costs of service are to be charged against the account analysis. The user friendliness and ease of navigating the online banking system will be important. The account analysis is to include at a minimum: Ledger balance Collected balances Detail of adjustments Reserve requirement Credit/debits Detail of services and related costs including differentials for deposited items Total cost of services A16. The bank must maintain wire transfer facilities through the Federal Reserve Bank System. In addition, the proposer must be both a sending and receiving bank on the Automated Clearing House (ACH) system. The bank shall present any issues of which the City should be aware or any additional options not presented in this proposal. A17. The bank shall provide online account balance and activity information for all City bank accounts, to include: Ability to view and download transaction detail Ability to transfer/upload files for positive pay plus transaction reports Ability to receive analysis data on-line. Ability to retrieve and download current and prior period statements Ability to initiate on-line banking transactions (e.g. ACH, wires, stop payments) A18. The City will provide all checks utilized. The bank will provide encoded deposit slips to the City at no additional cost. The City presently uses a duplicate carbonless deposit slip. Page 9

10 A19. The bank shall indicate the primary resource personnel and location of such personnel who will provide banking services to the City within the scope of this agreement. One primary bank officer should be designated for communication purposes. In addition, the bank shall identify liaison staff members as well, on the basis of primary contact people and backup contact people A20. An explanation of disaster recovery and backup procedures that are in place to protect the City and the bank in the event of disaster to either entity or both and how quickly back-up facilities will be activated. A21. The bank shall provide the City with overdraft protection including daylight overdrafts. The bank shall define, in detail, the rates and formula for calculating any charges resulting from an overdraft of minimum balance required of sweep account, (1) if balance drops below a pre-defined peg balance, (2) if account does not have sufficient balance to cover sweeps, (3) if there is insufficient collected funds to cover sweeps. A22. If the City develops a need for additional accounts or services during the term of the banking services agreement, those new accounts or services shall be provided with the most favorable conditions as apply to other customer accounts. A23. The City anticipates that proposed banking services will be compensated primarily on a fee basis but with some compensating balances. Fee prices in proposals are to be valid for the initial year of the contract. Annually, the prices per unit of service may be adjusted. The bank must state its adjustment factor and any changes in earnings on compensating balances. Page 10

11 B. OPTIONAL BANKING SERVICES B1. Semi-annual review of analysis statements by bank representative with Finance Director and staff to identify anomalies, problems, or opportunities for lower cost and improved services. B2. Debit cards please describe how this option would work with the general account, its costs, reporting, ease of adding/removing individual cards, and liabilities of all parties City, employee, and bank. If we choose this option, the cost will need to be easily charged to the department for whom the employee works. Electronic archival ability for researching charges, recent and past, will be important. B3. Corporate trust services ability to act as the debt payment agency to the holders of our bonds. B4. Investment instrument for some portion of our funds historically invested in the state s LGIP (See Exhibit C with historic account balances). We will make our decision based on a combination of the safety of the investment instrument, and its liquidity, maturity, and yield. Safety of the principal is the paramount consideration and the maturity must be fairly short term, approximating the Oregon Short-Term Fund. It is conceivable that after consideration of the bank s offering, the decision could be to remain completely with the LGIP. Page 11

12 C. CONDITIONS QUALIFYING A BANK TO PROPOSE Banking institutions submitting proposals must meet or exceed the following minimum criteria: (Indicate this by checking YES or NO next to each item) C1. Be a qualified public depository as prescribed by Oregon State Law (ORS 295). Institutions must meet or exceed the requirements outlined therein. C2. Since we are considering depositing funds in excess of amounts insured by the FDIC, only institutions listed on the state s website listed below can be considered. C3. Have a full-service bank branch located in the City of Seaside or Gearhart. C4. Be a member of the Federal Reserve System and have access to all of its services. C5. Be insured by the Federal Deposit Insurance Corporation (FDIC). C6. Be able to facilitate transfers to and from the Local Government Investment Pool managed by the Oregon State Treasurer s Office. C7. Be a full service bank capable of providing, at a minimum, the services described in the Required Banking Services section. C8. Be a federally or State of Oregon chartered financial institution. C9. Work with the City on implementing technological advancements that would be cost effective for the City. Proposals regarding these kinds of services should be described separately as optional services. Page 12

13 C10. Agree to assign experienced and dedicated staff that is committed and capable of servicing our accounts. C11. Be able to facilitate NACHA formatted Automated Clearing House ACH payments. YES NO Page 13

14 D. OTHER INSTRUCTIONS D1. The proposal may include services other than those set forth in Parts A and B of this solicitation which the City may wish to consider and acquire. The City reserves the right to solicit comparable information on such services from all other banks responding to this request for proposal. D2. Describe your organizational structure and staff profile, with a description of the bank s experience in providing services to the public sector, including staff resources dedicated to the public sector. D3. Include a sample of any service agreements your bank requires. D4. Include copies of audited financial statements for the past two years. D5. Include a schedule of all bank service fees. D6. Proposer shall complete and submit the Pricing Matrix (Exhibit A). State for what period of time the rates you propose will remain unchanged. Note any additional fees not included on the matrix. D7. Identify the index the earnings rate on the general account would be pegged to, listing the last six months applicable rates. D8. Though the City will normally attempt to keep the collected balance as low as possible, the earnings credit for the collected balance will be used to offset charges. Describe how the carry-forward is used in determining the earnings credit and the related settlement interval, monthly, quarterly, annually? Describe in detail the method of calculating the earnings credit and any applicable reserve requirements. Explain any charges that would not be offset by compensating balances. D9. Include a detailed description of the bank s online services available to the City and all its capabilities for anything not covered above. D10. Include a sample of the monthly detailed statement. D11. Include a sample of the monthly account analysis. D12. Describe briefly your proposed implementation plan and related timetable, including any required training and how your staff can assist the City in making the transition to your financial institution. The plan should provide the City with sufficient detail to allow for a reasonable estimate of the complexities and costs. Specifically address the assistance that would be provided in a transfer of merchant services. Page 14

15 ANTICIPATED SCHEDULE FOR SELECTION AND AWARD OF CONTRACT Distribute Request for Proposals December 3, 2009 Pre-proposal Meeting / Letter of Interest from bidders December 18 10:00 am. (City Hall, Council Chamber) (989 Broadway, Seaside, Oregon) Discussion of any issues, comments, proposal questions, etc. Sealed Proposals Due 3:00 p.m. January 29, 2010 Evaluate Proposals February 1-20 Interview Finalists (if necessary) To be determined Recommendation to City Council On or before February 22 Anticipated Notice of Intent to Award Contract February 23 Anticipated Contract Negotiations Award Contract Transition March March April May Effective Date of New Contract June 1, 2010 The anticipated selection date expresses the present intent of City of Seaside to award a contract for banking services and is not a representation, agreement or promise that in fact any contract will be awarded on that date or any other time. Page 15

16 EVALUATION CRITERIA It is the intent of City of Seaside to select the bank most qualified to provide the best value to the City for its banking activities. Best value is based not only on cost, but also includes the ability to provide quality desired services and support. 1. Cost of service; overall cost to provide the most efficient means to manage the City s cash assets. 70% 2. Services provided; ability to provide all of the minimum requirements and a proven record of technological capabilities, with plans for continued advancement / innovation. Accessibility to branch and services. 10% 3. Communication and interpersonal skills; ability to be responsive on an ongoing basis; a track record of effective working relationships with clients. Desirable to have existing public sector clients with record of positive relationships. Understanding the nature and scope of the work involved and being able to present an effective response to accomplish the work. 15% 4. Cost and effort impact on the City required implementing changes proposed by the bank. 5% 5. Financial condition and stability of current conditions. Low financial leverage is deemed desirable. (Rating is acceptable or unacceptable). A/U Page 16

17 CITY OF SEASIDE PROPOSAL RESPONSE FORMAT For Banking Services Please respond to the City s RFP in the same order as listed. Items are indexed to correspond with the numbers in the RFP instructions presented earlier. Additional comments may be added on a separate attachment; however, they should be clearly referenced to a line number on the response form. A1. General Account & Checking Accounts A2. Municipal Court Account A3. Direct Deposit of Payroll A4. Check Protection ( Positive Pay ) A5. Automated Account Reconciliation A6. Electronic Payment Authorization A7. Merchant Bankcard Services A8. HSA Accounts access A. REQUIRED BANKING SERVICES A9. Automatic Redeposit of Returned Checks A10. Stop Payments A11. Deposit credit timing schedule A12. Full Service Bank located in Seaside. A12. Examples of Funds Availability Schedule A13. Monthly Account Statements A14. Electronic On-Line Banking Information Page 17

18 A15. Monthly Account Analysis Statement A16. Electronic Funds Transfers A17. ACH and Wire Online Capabilities A18. Deposit Slips A19. Identify Assigned Personnel A20. Disaster Recovery / Backup Procedures A21. Rates and Formula for Overdraft Charges A22. Additional Accounts or Services A23. Fees in first year of contract and subsequent adjustments B. OPTIONAL BANKING SERVICES B1. Semi-Annual Review of Analysis Statement B2. Debit Cards B3. Corporate trust services B4. Investments C. CONDITIONS QUALIFYING A BANK TO PROPOSE C1 C11. Answer the listed questions Page 18

19 D. OTHER INSTRUCTIONS D1. Other Services Offered D2. Organization Structure D3. Service Agreements D4. Provide Audited Financial Statements D5. Provide a Schedule of all Bank Service Fees D6. Complete Pricing Matrix (Exhibit A) D7. Interest Earnings Rate on General Account D8. Earnings Credit Methodology D9. Sample of on-line Balance Report D10. Sample of Monthly Detailed Statement D11. Sample of Monthly Account Analysis D12. Implementation Plan and Timetable Page 19