HomeMy WebLinkAbout1997-04-22 - AGENDA REPORTS - SELECTION PRIMARY BANK (2)CONSENT CALENDAR
DATE: April 22, 1997
City Mana
Item to be
Steve Stark
SUBJECT: SELECTION OF PRIMARY BANK TO PROVIDE CITY'S
BANKING SERVICES
RESOLUTION NO. 97-50
DEPARTMENT: Administrative Services
The City is currently utilizing TransWorld Bank as its primary bank. In order to ensure that the City
was receiving the highest quality banking services, a Request for Proposal (RFP) for Banking
Services was issued on January 28, 1997.
Seventeen (17) RFP's were sent to various banks. Proposals were submitted by the following:
American State Pacific Bank
Bank of America
Union Bank of California
Glendale Federal Bank
Valencia National Bank
The banks were evaluated on the types and quality of services they were able to provide to the City
and the cost of those services. Three banks, Glendale Federal, Union Bank of California, and
Valencia National Bank, were selected for interview. Based on all criteria, it was determined that
Valencia National Bank was able to provide the highest quality banking services at a reasonable
price. The total monthly fee that Valencia National Bank will charge will be approximately $725.
This charge will be covered by maintaining an average compensating balance of approximately
$200,000 and, therefore, will have no budget impact.
Staff is also requesting authorization to enter into a daylight overdraft arrangement with Valencia
National Bank which will provide the opportunity to invest funds the same day that they become
available.
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City Council award contract for banking services to Valencia National Bank effective June 1,
1997, for a period of three (3) years, with an option to renew for two (2) additional years.
2. City Council authorize the City Manager to negotiate the terms of the Banking Services and
Agreement and to sign all documents, subject to City Attorney approval.
City Council adopt Resolution No. 97-50 authorizing daylight overdraft.
ATTACHMENTS
• Resolution No. 97-50
• Valencia National Bank's Proposal For Banking Services Including Addendum (Located in City
Clerk's Office Reading File)
• Contract For Deposit of Local Agency Funds (Located in City Clerk's Office Reading File)
• Banking Services Agreement (Located in City Clerk's Office Reading File)
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A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF SANTA CLARITA, CALIFORNIA
APPROVING AGREEMENT REGARDING DAYLIGHT OVERDRAFT PROTECTION
WITH VALENCIA NATIONAL BANK
WHEREAS, pursuant to the terms and conditions of the Banking Services Agreement
between the City of Santa Clarita and Valencia National Bank, effective June 1, 1997,
THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, DOES
HEREBY RESOLVE AS FOLLOWS:
SECTION 1. On occasion, it is necessary to provide the City the opportunity to use,
disburse, and/or invest funds from the City's bank accounts during a normal business day,
prior to these funds having been collected and credited to the City's accounts, which is
known as Daylight Overdraft Protection. Daylight Overdraft Protection is defined as an
allowance of overdraft of funds only during a period of time within the course of a normal
business day insofar as the account has sufficient funds and is not overdrawn at the close of
the business day.
SECTION 2. The City finds and determines that approval of an agreement with Valencia
National Bank to provide daylight overdraft protection is necessary to accommodate the
above -referenced goals and to allow for the City to serve the general welfare of the citizens
of Santa Clarita.
SECTION 3. The City Council hereby approves that certain Agreement which is
incorporated and is a binding part of the "Banking Services Agreement," and authorizes
the Mayor to execute the Agreement on behalf of the City in substantially the form
attached hereto as Exhibit A, subject to approval by the City Attorney.
• 0.
SECTION 4. The City Clerk shall certify to the adoption of this Resolution.
PASSED, APPROVED AND ADOPTED THIS 22nd day of April, 1997,
MAYOR
ATTEST:
CITY CLERK
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) §
CITY OF SANTA CLARITA )
I, Sharon Dawson, City Clerk of the City of Santa Clarita, do hereby certify that the
foregoing Resolution was duly adopted by the City Council of the City of Santa Clarita at a
regular meeting thereof, held on the _ day of , 19_ by the following vote
of Council:
AYES: COUNCILMEMBERS:
NOES: COUNCILMEMBERS:
ABSENT: COUNCILMEMBERS:
CITY CLERK
"Exhibit A to Resolution 97-50"
AGREEMENT FOR BANKING SERVICES
BETWEEN
THE CITY OF SANTA CLARITA
AND
VALENCIA NATIONAL BANK
This AGREEMENT FOR BANKING SERVICES BETWEEN THE CITY OF
SANTA CLARPPA AND VALENCIA NATIONAL BANK ("AGREEMENT") is entered into
this day of 1997, by the City of Santa Clarita, ("CITY"), and Valencia National
Bank ("BANK").
RECITALS
WHEREAS, the CITY issued a Request For Proposal for Banking Services and
all Addendums thereto ("RFP"); and
WHEREAS, in response to the CITY's RFP, the BANK submitted its
PROPOSAL for Banking Services and all Addendums thereto ("PROPOSAL"); and
WHEREAS, the CITY has reviewed the various proposals from other financial
institutions and has determined that it wishes to maintain an account or accounts with the BANK
and desires certain Banking services in connection therewith; and
WHEREAS, the BANK is willing to accept such account or accounts and provide
such services upon the terms and conditions hereinafter stated; and
set forth,
WHEREAS, in consideration of the mutual and dependent promises hereinafter
NOW THEREFORE, THE PARTIES AGREE AS FOLLOWS:
SECTION 1. TERM.
The term of this AGREEMENT shall be from the date of execution of this
AGREEMENT, and unless renewed or properly terminated as outlined in Section 5 below, shall
terminate automatically on the third (3rd) anniversary of the effective date.
SECTION 2. DESCRIPTION OF SERVICES.
Subject to the terms and conditions of the AGREEMENT, and upon the CITY's
specific requests, which the CITY may make from time to time, the BANK shall provide any or
all services requested by the CITY in the RFP or proposed by the BANK in the PROPOSAL.
The CITY may from time to time add or discontinue any of the services upon
page no. 1
written notice to the BANK.
In performing (or causing to be performed) any and all of the services, the BANK
shall exercise good faith and due care consistent with industry standards.
A copy of the RFP is attached hereto as Exhibits A through F and a copy of the
PROPOSAL is attached hereto as Exhibits G through J, and incorporated herein by this
reference. The parties acknowledge that the RFP was prepared by the CITY as an expression of
the CITY's expectations in connection with this AGREEMENT. The provisions of the RFP and
the PROPOSAL shall be construed in such a manner that creates legal rights of the CITY,
consistent with the CITY's expectations, and corresponding legal obligations of the BANK.
SECTION 3. FEES AND PAYMENTS.
The fees for the services subject to this AGREEMENT are stated in the BANK's
PROPOSAL. The fees will be fixed for three years subject to possible adjustments due to
changes in the Consumer Price Index; such adjustments may be made only upon giving a thirty
(30) day written notice to the CITY.
Monthly fees will be paid by way of the CITY maintaining a compensating
balance which will be analyzed monthly and any excess or deficit earnings will be carried
forward to future months or backwards to prior months; any overall deficit will be settled and
paid at each anniversary of the effective date of this AGREEMENT.
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Any change, deletion, or additions to AGREEMENT can be made by mutual
consent of both the CITY and the BANK.
SECTION 5. TERMINATION
CITY may terminate this AGREEMENT at any time by giving ten (10) days'
written notice of termination to BANK.
BANK may terminate this AGREEMENT at any time upon thirty (30) days'
written notice of termination to CITY.
If BANK or CITY fails to perform any material obligation under this
AGREEMENT, then, in addition to all other remedies, CITY or BANK may terminate this
AGREEMENT immediately upon written notice.
Upon termination by either CITY or BANK, BANK shall deliver to CITY all
property of the CITY in BANK's possession and copies of all reports, documents, and other
work prepared by BANK under this AGREEMENT.
page no. 2
Termination of this AGREEMENT shall not affect the CITY's payment
obligations with respect to services performed by the BANK prior to termination, or any other
obligation which survive termination. Upon any termination of this AGREEMENT, the BANK
agrees to cooperate with the CITY and provide services necessary to ensure a smooth transition
with minimal disruption of the CITY's affairs to another BANK or service provider.
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The BANK agrees to comply with all applicable laws, statutes, ordinances, rules
and regulations of the federal, state and local government in effect in connection with its
provision of the services and the fulfillment of its obligations under this AGREEMENT.
SECTION 7. INTEGRATION..
This AGREEMENT, together with the RFP attached hereto as Exhibits A through
F and the PROPOSAL attached hereto as Exhibits G through J, constitutes the entire
AGREEMENT between the Parties, and there are no conditions, representations or agreements
regarding the matters covered by the AGREEMENT which are not expressed herein. (see agreement file
for Exhibits A through J)
P1 DINA 1►: 1 ;►
The law of the State of California shall govern this AGREEMENT. In the event
of litigation between the parties, venue in state trial courts shall lie exclusively in the county of
Los Angeles. In the event of litigation in a U.S. District Court, exclusive venue shall lie in the
Central. District of California, in Los Angeles.
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This AGREEMENT shall be binding upon the Parties and their respective
successors and assigns.
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This AGREEMENT may be executed in counterparts which taken together shall
constitute one AGREEMENT.
BANK agrees to indemnify, protect, and defend (with counsel of the City's
choice) and hold harmless CITY and all of its officers, agents, elected or appointed officials and
employees from any and all liability, claims, damages, or injuries to any person, and all claims
which arise from or are connected with the performance of or failure to perform the work or
other obligations of this AGREEMENT, or are caused or claimed to be caused by the acts or
omissions of its agents or employees, and all expenses of investigation and defending against
same; provided, however, that this indemnification and hold harmless shall not include any claim
arising from the active negligence or willful misconduct of the CITY, its agent or employees.
page no. 3
SECTION 12, NONDISCRIMINATION
BANK shall not discriminate, in any way, against any person on the basis of age,
sex, race, color, religious creed, national origin, ancestry, physical handicap, medical condition or
marital status in connection with or related to the performance of this AGREEMENT.
Waiver by CITY or BANK of any breach of any of the provisions of this
AGREEMENT shall not constitute a wavier of any other provision nor a waiver of any
subsequent breach or violation of the same or any other provision of this AGREEMENT.
Acceptance by CITY of any work or services by BANK shall not be a waiver of any of the
provisions of this AGREEMENT.
SECTION 14, CONFLICT OF INTEREST.
BANK shall at all times avoid conflict of interest or appearance of conflict of
interest with the interests of the CITY in the performance of this AGREEMENT.
U 19Ir MOURtw
EXHIBITS "A" through "J" are attached to and incorporated in this
AGREEMENT by this reference. Additional language describing specific duties and
responsibilities are outlined in the exhibits and are inclusive to contract. (see agreement file for
Exhibits A through J)
PXw"O_UIN/
All notices required or permitted to be given under this AGREEMENT shall be
sent to the CITY at the following address:
City of Santa Clarita
Finance Division
23920 Valencia Boulevard, Suite 300
Santa Clarita, CA 91355
All other notices and other communications to the BANK hereunder shall be sent
to the BANK at the Following address:
Valencia National Bank
23620 Lyons Avenue
Santa Clarita, CA 91321
Notice shall be deemed effective on the date delivered or transmitted by facsimile
or, if mailed, three (3) days after deposit in the mail.
page no. 4
All disputes concerning the interpretation, performance, breach or termination of
this AGREEMENT shall be decided by binding arbitration before a retired federal or California
judge, according to the provisions of Section 1280 et seq. Of the California Code of Civil
Procedure, through the Los Angeles County offices of the Judicial Arbitration and Mediation
Service ("JAMS"). The parties shall attempt to agree upon a retired judge from the JAMS panel,
but if they are unable to agree within thirty (3) days after commencement of a proceeding, JAMS
will provide alist of three available judges and each party may strike one. If for any reasons
JAMS is unavailable, the dispute shall be decided by a retired federal or California judge, sitting
as an arbitrator, and selected by the parties. If the parties are unable to agree upon a retired judge
within 30 days after receipt of written notice, a retired judge shall be appointed by the Presiding
Judge of the Los Angeles County Superior Court. The arbitrator shall render a written decision
stating reasons therefor in reasonable detail within sixty (60) days after his appointment. The
arbitrator's award shall be final and enforceable and may be confirmed by the judgment of a
court of competent jurisdiction. The prevailing party shall be entitled to recover its costs of
arbitration, as well as costs and attorneys' fees, and expert witness fees, as determined by the
arbitrator, as well as costs and attorneys' fees in any proceedings to enforce an award. The
parties reserve their rights to obtain provisional remedies from the courts, and no application for
any such remedy shall be deemed inconsistent with the obligation to arbitrate disputes.
Except for nonpayment of any portion of a statement presented to CITY by
BANK, if any dispute arises between the parties to this AGREEMENT, BANK shall continue to
perform pending resolution of the dispute.
RMW 0 1 1"U41 1 ' URI] 1
Pursuant to the City of Santa Clarita Resolution No. 97-50, the BANK will grant
the CITY daylight overdraft protection which allows overdraft of funds only during a period of
time within the course of a normal business day insofar as the CITY's account has sufficient
funds and is not overdrawn at the close of the business day.
SECTION 19, TELEPHONIC REQUESTS FOR WIRE TRANSFERS.
The BANK is authorized to honor a telephonic, oral, telegraphic, telex, facsimile
or written request which the BANK in good faith believes to have been made by an Authorized
Representative for the transfer of funds from any account maintained by the CITY hereunder to
any other such account or for any other purpose, including without limitation to transfer funds to
an account of the CITY or any third party bank, and to debit and/or credit the CITY's account(s)
therefor.
page no. 5
written above.
Attest:
City Clerk
WITNESS THE EXECUTION of this AGREEMENT on the day and year first
THE CITY OF SANTA CLARITA
m
George Caravalho, CITY Manager
Date Date:
Approved as to form:
BURKE, WILLIAMS & SORENSEN
m
Carl K. Newton, CITY Attorney
Date:
COMPANY NAME
m
Date:
page no. 6
EXHIBIT A
CITY OF SANTA CLARITA
23920 VALENCIA BLVD., SUITE 300
SANTA CLARITA, CA 91355
REQUEST FOR PROPOSAL FOR BANKING SERVICES
I. INTRODUCTION
The City of Santa Clarita is requesting proposals for full-service banking services from financial
institutions that meet the requirements set forth in the Financial Code Section 5102 and the
applicable Government Code Sections 53637 through 53692 attached. The City's objective is to
obtain state-of-the-art, high quality, comprehensive banking services that will fully meet the City's
growing and varied needs at the lowest possible cost to the taxpayers. It is the intention of the City
to evaluate every three years its existing banking arrangements to determine if demands are being
adequately satisfied.
II. CITY OVERVIEW
The City of Santa Clarita is a General Law City incorporated in 1987, and operates under the
Council/Manager form of government. The City provides a wide range of municipal services
including: community planning, building and safety services, street maintenance, parkway and
landscape maintenance, public transportation, as well as numerous park and recreational programs.
The City has approximately 200 full-time employees, and may employ up to 150 part-time
employees on a seasonal basis. For fiscal year 1996-97, the City adopted an operating budget of
approximately $56 million.
III. PRESENT BANKING STRUCTURE AND SERVICES
The City of Santa Clarita currently maintains one concentration (overdraft) account and two zero
balance checking accounts --one for accounts payable (general) checks and one for payroll checks --
whereby daily debit transfers are made from the concentration account to the general checking
account and to the payroll account in the exact amount needed.
Santa Clarita also has available on-line account activity information. Via a modem, the City
connects to the bank and downloads information on all transactions on the three accounts to a
personal computer, including deposits, cleared checks and transfers.
City of Santa Clarita _ RFP for Banking Services
Incoming and outgoing wires occur regularly in the City's concentration account. Incoming wires
consist of, among other things, allocations from the County and the State as well as withdrawals
from the Local Agency Investment Fund (LAIF). Outgoing wires consist of, among other things,
payments to investment brokers for securities purchased, deposits to LAIF, and debt service
payments on bond issues.
IV. RFP SUBMISSION PROCESS
After the City Clerk has published the "Notice Inviting RFP's" in the local newspapers, submission
packets will be available at the Finance Division counter at City Hall or will be distributed by request
to financial institutions by mail. The deadline for submitting the completed proposal is February 28.
1M. Proposals must be signed by an individual who is authorized to bind the financial institution
to all commitments purported in the proposal. Five copies of the proposal should be submitted in
a sealed envelope with the outside marked: "Banking Services Proposal." Proposals will not be
opened until after the deadline. Additionally, proposals will not be disclosed to competing firms or
to the public until after the recommended financial institution has been selected. You may submit
the proposal to the Administrative Services Department, General Services Division in person, or by
mailing to:
CITY OF SANTA CLARITA
GENERAL SERVICES DIVISION
BANKING SERVICES RFP
23920 VALENCIA BLVD., SUITE 294
- SANTA CLARITA, CA 91355
ATTN: JON BISCHETSRIEDER
V. PROPOSAL CONTENT
All proposals submitted must include the Proposal Submission Package, as well as any.other
information conceming the qualifications of the financial institution. This information may include,
but is not limited to:
• The institution's philosophy regarding its relationship with the client.
• Prior experience of the institution in providing services to major commercial or government
accounts.
• Identification of staff capabilities, along with resumes of the key personnel who will be working
with the City of Santa Clarita at the branch level.
City of Santa Clarita -- RFP for Banking Services
• Samples of reports to be provided to the City.
• Copies of the institution's Annual Financial Reports for the last three (3) most current years.
• Other information the financial institution believes to be appropriate.
VI. PROPOSAL TERMS AND CONDITIONS
• Each proposal shall meet all of the specifications discussed in this RFP. If a proposal is provided
for an individual banking service requirement, it is assumed that the proposal meets or exceeds
the requirements as stated. If a service requirement cannot be met by the financial institution,
then the phrase "NO PROPOSAL" should be entered on the proposal form for that service
requirement. In the case of a "NO PROPOSAL" remark, the financial institution may offer an
equivalent service, which must be described in detail on a supplemental attachment. Any non -
substantial deviations may be considered provided that the financial institution submits a full
description and justification for the proposed deviation. The final determination regarding any
proposed equivalent to the service requested will be made by the City.
• All financial institutions must be F.D.I.C. insured in order to be eligible for consideration by the
City.
All questions or requests for information must be submitted in writing only and will receive a
written response from the City. These responses will also be sent to all other financial
institutions that requested a Proposal Submission Package. Telephone communications with
City staff are not permitted; however, in the interest of time, questions may be faxed. The City's
fax number is (805) 259-8125. Please address the fax to April Jordan, Finance and provide
a fax number to which the City may send responses.
• Proposers must be a federally or State of California chartered institution during the term of the
contract.
• The number of transactions indicated in the Proposal Submission Package is believed to be a
reliable estimate of the City's banking activities. However, the actual number of transactions
may vary, and no guarantees are provided by the City regarding minimum or maximum volumes.
• Each financial institution submitting a proposal shall include copies of their annual audited
financial report for the past three (3) years. These reports will be used to determine the financial
strength of the financial institution.'
City of Santa Ciatita -- RFP for Banking Services
• The City reserves the right to retain all proposals submitted. the City reserves the right to waive
non -substantial irregularities in any proposal, to reject any or all proposals, and to reject part of
a proposal and accept the other, except to the extent that proposals are qualified by specific
limitations by the financial institution.
• The Proposal Submission Package must be completed in its entirety. The extensions of unit
price figures for the estimated quantities as well as lump -sum prices must be entered in the
spaces provided. If the unit price and total amount quoted by any financial institution for any
item are not quoted in agreement, the unit price alone will be considered as representing the
financial institution's intention, and the total will be corrected to conform to the specified unit
price. Unit price amounts for all services provided are to be included in the Proposal Submission
Package.
• Firms may withdraw their proposals, without prejudice, prior to the date and time specified for
proposal submission, by submitting a written request to the City's Director of Administrative
Services/City Treasurer for its withdrawal. No proposal received after the closing date or at any
location other than the location stated in the "Notice Requesting RFP" will be considered.
• The financial institution to whom award is made shall execute a written contract with the City
within ten (10) working days after Notice of Award has been sent by mail at the address provided
in the financial institution's proposal.
• If the financial institution to whom the award is made fails to enter into the contract, the award
will be annulled and an award will be made to the next best proposer as determined by the City;
and that firm shall fulfill every stipulation as if it were the party to whom the first award was
made.
• The financial institution to whom the award is made shall assist the City in converting current
banking services to the new financial institution in order to insure a smooth transition from one
service to another.
• The successful financial institution shall not assign, transfer, convey, or otherwise dispose of the
contract, or right, title of interest, or power to execute such a contract to any person, firm, or
corporation without previous consent in writing by the City Council of Santa Clarita.
• In the performance of the terms of this RFP, the financial institution agrees that it will not engage
in or permit such subcontrators as the firm may employ to engage in discrimination in the
employment of persons because of age, race, color, sex, national origin or ancestry or religion
of such persons.
• The contract shall provide that the City reserves the right to terminate the contract at any time
upon sixty (60) days' prior written notice of the City's intent to terminate .the contract.
City of Santa Clarita .- RFP for Banking Services 4
Causes for termination of the contract may'include the following: failure to promptly and
faithfully provide the services required in this RFP; violation of any law governing any municipal
depository; failure to cooperate upon receiving any reasonable request for information or service;
and improper actions of the institution's officers or employees which, in the opinion of the City,
would adversely affect the City's interest or endanger the safety or liquidity of municipal funds.
• Term of contract shall be three (3) years with option to renew two additional years.
VII. REQUIRED SERVICES
A.
OPERATING ACCOUNT - Volume and nature of
Unit
Monthly
transactions
Charge
Charge
1.
The City averages approximately 65
$
$
separate deposits a month.
2.
Average number of checks deposited
$
$
monthly: 550
3.
The average number of checks to clear
$
$
the bank per month is 1,050.
4.
Returned checks average 18 per month
$
$
5. Stop payments average 4 per month.
6. Bank must provide daily balance reporting
service that the City can obtain by 8:00 a.m. each
day for ledger, collected, and available balances,
and total debit and credit information, for the
previous day's activity.
7. Bank must be able to provide in and -out wire
services for transfer of funds to and from other
financial institutions and brokerage firms within
the United States for various purposes. Such
transfers will be "same day."
Please state the time of day of the wire
deadline:
City of Santa Clarita -- RFP for Banking Services
Average number of outgoing wires, initiated by
the City, per month: 5
Average number of incoming wires, initiated by
the City, per month: 5
8. Bank will receive and guarantee immediate
credit on all incoming wire transfers.
9. All debit and credit confirmations must be
received by the City within three days following
the date transactions occur.
Not Applicable
Discount
R=
10. Bank must accept MasterCard/Visa deposits. $
Average number of credit card transactions
per month: 400
Inclusive Monthly Charges for General Account
Transactions Based on Volume as Described Above
The City may desire to maintain separate Zero
Balance Accounts tied directly to the operating
account. These are unfunded disbursement
accounts. The 'overdraft' created is covered
by daily transfers of funds from the operating
account as checks clear against the ZBA.
City of Santa Cla ita — RFP for Banking Services 6
Mo. Minimum
Discount Charge
Unit Monthly
Charge Charge
Inclusive Monthly Charge for ZBA Accounts on
Above Volumes
The Bank will accept direct deposits to the $ $
City's account from the State of California
(almost entirely from the State Treasurer's
Office, State Controller's Office, and the U.S.
Treasury) and guarantee Immediate credit for
such deposits.
Average number per month: 4
Unit Monthly
Charge Charee
2. The Bank will accept Automatic Payroll
Deposits on behalf of the employees of
Santa Clarita.
Number of employees with direct deposit
is approximately 200.
Please list the available options for trans-
mitting payroll data to your bank. (Modem
is preferred)
The City currently employs approximately
200 people.
3. Bank will process Letter of Credit payment $ $
requests, by wire service, from the U.S. .
Treasury and guarantee immediate credit for
such deposits.
4. Bank will provide "same day" notification Not Applicable
to the City on all direct deposits.
City of Santa Clarita — RFP for Banking Services 7
Q
E.
F.
Inclusive Monthly Charge for Direct Deposits
Based on Volume Described Above:
RRIk"T COMM
1. The City requires monthly Account Statements
for the Operating Account and two Zero Balance
Accounts. Account Statements must include
Advices for Debits, Credits, Adjustments, and
Canceled Checks and be submitted by the 5th
working day of the following month.
2. The City requires that all debit and credit
confirmation slips are received within three
days following the date when the transactions
occur.
The bank will provide armored car service three
days per week for funds in transit from Santa
Clarita City Hall to the bank at a time which will
ensure deposit on the same day as pickup.
The Bank will supply a monthly account
analysis statement within five working days
after the close of each calendar month. Please
submit a copy of your Account Analysis
Statement.
City of Santa Clarita-- RFP for Banking Services
Unit Monthly
Charge Charge
Not Applicable
1;K�IuvIL� ►��C
G. FORMS
The Bank will furnish all necessary forms,
including but not limited to deposit slips,
stop payment forms, deposit bags (including
tags and fasteners), coin wrappers, etc.
excluding checks.
H. COIN COUNTER
The Bank will furnish a coin counter to
the City to be kept on City's facilities.
I. COMMUNICATIONS
The Bank must designate a specific officer and
an alternative to act as City liaison representative.
J. DAILY BALANCE EPORTIN
The Bank will provide daily balance reporting
services by computer access so that the City can
obtain by 8:00 am. each day data on ledger,
collected and available balances and itemized
City of Santa Clarita •. RFP for Banking Services 9
Unit Monthly
Charge Charge
Not Applicable
Unit Monthly
Charge Sham
0
debit and credit information and canceled checks
relating to the previous day's activity.
COMMENTS:
• It 6
The City of Santa Clarita has established
two (2) credit cards for business use, with a
total credit line of $2,500.
The City of Santa Clarita would like the ability
to download account information into its
financial system in order to complete such
automated functions such as check reconcil-
iations.
If the bank desires to offer this service, a supplement
attachment should be prepared and included with
the proposal describing the service in detail. The
various options available for downloading (i.e. modem,
CD, floppy disk, etc.) should be indicated as well as
the cost, if any, for this service.
City of Santa Clarita — RFP for Banking Services 10
Annual
APE E=
FA
KGMTU • alm I all 13-1:1
A.
OPERATING ACCOUNT
B.
ZERO BALANCE ACCOUNTS
C.
DIRECT DEPOSITS
D.
BANK STATEMENTS AND
RECONCILIATION SERVICES
E.
ARMORED CAR SERVICES
F.
ACCOUNT ANALYSIS
STATEMENT
H.
COIN COUNTER
I.
DAILY BALANCE REPORTING
K.
VISA CREDIT CARDS
L.
COMPUTER DATA OUTPUT
TOTAL MONTHLY FEE
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED
U.•\ •.. w. CS i.• •
$
City of Santa Clarita — RFP for Banking Services I I
VIII. OPTIONAL SERVICES
Unit Monthly
Charge Char=
A. SAFE DEPOSIT BOX
The Bank may provide one (1) safe deposit box $ $
for the City. The box should be large,
approximately 10" X 11" X 21" in dimension.
COMMENTS:
B. MESSENGER SERVIC
The Bank may provide on-call messenger $ $
service between City Hall and the bank.
COMMENTS:
C. LOW INTEREST EMPLOYEE LOANS
The Bank may provide low-interest loans to
employees for City -sponsored purchasing
programs.
D. SAFEKFFPING OF INVESTMENTS
1. Under the rules and regulations of Government
Code Section 53608, the Bank may provide third
City of Santa Clarita -- RFP for Banking Services 12
0
Unit Monthly
Charee Char
party custodial services for all securities that the
City purchases from any source. All securities
must be received and delivered using standard
delivery versus payment (DVP) procedures which
ensures that securities are deposited with the
custodian bank prior to the release of funds.
The average number of securities purchased
per month is: 2 to 3
The average number of maturites per month
is: 2 to 3
The average size of the City's investment
portfolio is $30,000,000. Of this amount
approximately 50% is invested in LAIF and
is not subject to safekeeping.
2. The Bank shall provide monthly statements
listing the securities inventory held in safe-
keeping and shall provide a receipt for
securities deposited and interest payments and
a credit advice for securities sold or matured.
3. Will.Bank provide assured same-day credit
of the City's account at each investment
maturity date in the amount of all principal
and interest due, or will it credit only upon
receipt of that amount from the institution
which delivers the funds? (Note: The City
presently receives assured same-day credit
so that it inevitably may invest matured funds
on the maturity date. Lack of same-day
investment capability would be considered
a serious deprivation.) Indicate any charges
related to providing inevitable availability
of funds in these circumstances.
City of Santa Clarita — RFP for Banking Services 13
Not Applicable
a U Wd Lei a LONI 9 Leit
SERVICE
A. SAFE DEPOSIT BOX
B. MESSENGER SERVICE
D. SAFEKEEPING OF
INVESTMENTS
TOTAL MONTHLY FEE
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED
u9 WPrawall
$
IX. ADDITIONAL SERVICES
$
A. MISCELLANEOUS RVICF
Use this item to elaborate on services your bank will offer the City which are not covered
in the previous sections.
City of Santa Ctarita -- RFP for Banking Services 14
Please describe briefly any plans you offer which would be beneficial to individual accounts
of employees of the City. Please include reference to free checking accounts for employees
of the City of Santa Clarita.
s 10 ra"WK01=110•I1 • ;
A. MISCELLANEOUS SERVICES
B. INDIVIDUAL EMPLOYEE
ACCOUNTS
TOTAL MONTHLY FEE $
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED $
City of Santa CMta— RFP for Banking Services 15
X. PRICING OF BANKING SERVICES
MEMEMMUMI-610 MINE Rio
;
1. Will bank credit, against fees, the interest on average collected balance (monthly or
other periods)? The rate should be tied to some well-defined market rate as the
90 -day Treasury Bill rate, prime rate, etc. Please specify and submit formula.
2. As an alternative, would the bank provide for automatic overnight deposits of
collected balance in an interest-bearing account, or could the entire general account
be placed in an interest-bearing account? Again, the rate should be tied to some well-
defined market index. Please specify and submit formula.
City of Santa Clarita— RFP for Banking Services 16
3. For how long a period beyond the first year would the bank guarantee the fixed
charges quoted? On what basis (index or market) would these fixed fees be
modified:*
4. When would payment be due for the fees? Monthly, quarterly, or yearly, and date
after the end of period.
City of Santa Clarita — RFP for Banking Services 17
How will the bank stipulate the required compensating balance? On what rate index
will this be determined? PLEASE SUBMIT FORMULA. Will the compensating
balance be based on ledger or collected balances? Will the excess or deficit earnings
be carried forward to future months or backward to prior months? Please attach
formula for computing balance requirement.
2. For what period of time would the Bank agree to a fixed amount for compensating
balance, regardless of the volume of transactions? How much notice prior to
effective date of any change in compensating balance will the Bank provide?
l
City of Santa Clarita -- RFP for Banking Services 18
In the event that the City's actual collected balancesexceedthe amount stipulated,
would the Bank agree to pay interest on the excess? If so, please explain, stating
period of calculation. Please submit formula.
4. If the answer to the previous questions is negative, would the Bank provide for an
overnight interest bearing account to automatically receive funds in excess of
requirements? Again, this should be determined by some well-defined index. Please
specify.
(Include Money Market and Super NOW Accounts.)
City of Santa Clarita -- RFP for Banking Services 19
What charges would be made for "uncollected funds used" and on what rate or index
would this charge be determined?
2. Please indicate the exact number of days "float time" for deposits:
1) Checks drawn of proposer's bank: days
2) Checks drawn on California's banks: days
3) Checks drawn on Out of State Banks days
3. During the full term of the agreement, will the bank permit switches from Payment
Option 1 to Payment Option 2 (or visa versa)? Please state at what period of time
such change will be permitted and how much advance notice is required.
City of Santa Clarita -- RFP for Banking Services 20
4. Are all funds deposited available for immediate investment or other disbursements'?
(i.e., total ledger balance).
5. We now receive (at no charge) information on daily debits and credits. Will your
bank be able to famish this information from your branch every morning?
6. You have been requested to state the rates for various services. Will those rates
apply to either payment options - Direct Fees or Compensating Balances?
7. Please note any additional charges or volume discounts that apply to all services
listed.
8. The City may add facilities where by the daily balances, total debits and credits now
received by telephone, could be transmitted directly into our computer facilities.
Would there be any difference in charges for this method? If so, please state:
Under Fixed Fees Payment Option 1:
Under Compensating Balance - Payment Option 2:
City of Santa Clarita — RFP for Banking Services 21
9. Can you provide a float analysis report and indicate the cost for:
a) one day report, b) one month report.
Please attach Float Availability Schedule.
XI. REFERENCES
A. The following reference information is required for at least two (2) local government
accounts currently serviced by your bank. By providing this information, it is understood
that the City may contact any of these account holders for reference information. In
particular, please include any Local Government Account serviced by your Santa Clarita
branch.
PHONE
LOCAL• _ ; ul ► UNIT • • u
B. The following reference information is required for at least two (2) commercial accounts
currently serviced by the branch location that will service the City's accounts. By providing
this information, it is understood that the City may contact any of these account holders for
reference information. Commercial accounts whose owners serve in any official capacity
with the proposing firth should not be listed as a reference.
PRINCIPAL PRODUCT COMPANY TELEPHONE
141010 1 Valareff.13l 61 ; • ►Y V4141 • ► Ztljsl:
City of Santa Clarita -- RFP for Banking Services 22
XII. BANK STABILITY MEASURES
Ratio
A. CASH AND
1_
DEPOSITS
C. CAPITAL
ASSETS
D. LOANS
DEPOSITS
•
EN
F. W-61.1
INCOME BEFORE
SFCIJRrrMS TRANSACTIONS
City of Santa Clarita •. RFP for Banking Services 23
§ 53595.55 GOVERNMENT CODE
§ 53595.55. Construction of article
This article shall he deemed to provide a complete, additional, and alternative method for doing the
things authorized hereby and shall be regarded as supplemental .and additional to polo the wers of err d by
other laws. This article shall be liberally construed so as to effectuate its pure
at
this article is inconsistent with any other general statute or special act or parts thereof, this article shall
be deemed controlling.
(Added by Stats.1993, C. 902 (A.B.1251), § 1, eff. Oct. 8, 1993-)
Chapter 4
FINANCIAL AFFAIRS
Section
Article
53717
3.6.
................................
Public Library Special Taxes ..................... ..
... 53720
3.7.
Voter Approval of Taxes.........................................................
53730.01
3.6.
Hospital Districts; Special Taxes .......... ..............................
.. 53980
17,
Plan ............. CommunityFa-c-..
eeme .........
Local Tex Allocation Agreement9 to Implement Community Facilities Plane";
Local Tax Allocation
53990
53995
16.
19.
obligation of Contract .............................. .
Article I
INVESTMENT OF SURPLUS
Section Section
53601.1. Investment in financial futures or finan-
53601.5. Investments; qualified purchase agent.
tial option contracts.
Cross References
Ventura County Waste Management Authority, invest,
ing of surplus money, see Public Resources Code,
§ 60256.
§ 53600- Local agency, definition
As used in this article, "local agency' means county, city, city and county, including a chartered city or
county, school district, community college district, public district, county board of education, county
superintendent of schools, or any public or municipal corporation.
(Amended by Stats -1984, c 124, § 2; Stats. 1984, C. 1226, § 1: Stats.1987, c. 887, § 2-)
§ 5360L- Authorized investments; circumstances
The legislative body of a local agency having money in a sinking fund of, or surplus money motion in the
treasury not required for the immediate necessities of the local agency may invest any p
money that it deems wise or expe[ien.. in ' • ' those investments set forth below. However.*
where thus section does net specify a limitation on the term or remaining matunty at the time of the
investment, no investment shall be made in any security, other than a security underlying a repurchase or
reverse repurchase agreement authorized by this section, that at the time of the investment has a term
retraining to maturity in excess of five years, unless the legislative body has granted express authority to
make that investment. either specifically or as a part of an investment program approved by the
legislative body no less than three months prior to the investment:
(a) Bonds issued by the local agency, including bonds payable solely out of the revenues from a
revenue-producing property owned, controlled or operated by the local agency or by a department.
board, agency, or authority of the local agency.
(b) United States Treasury notes, bonds, bills, or certificates of indebtedness, or those for which the
faith and credit of the United States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this state. including bonds payable solely
out of the revenues from a revenue-producing property owned, controlled, or operated by the state or I)-.-
a
::a department, board, agency, or authority of the state.
Additions or changes Indicated by underline; deletions by asterisks
148
GOVERNMENT CODE §53601
(d) Bonds, notes, warrants, or other evidences of indebtedness of any local agency within this state,
including bonds payable solely out of the revenues from a revenue-producing property owned, controlled,
or operated by the local agency, or by a department, board, agency, or authority of the local agency.
(e) Obligations issued by banks for cooperatives, federal land banks, federal intermediate credit banks,
federal home loan banks, the Federal Home Loan Bank Board, the Tennessee Valley Authority, or in
obligations, participations, or other instruments of, or issued by, or fully guaranteed as to principal and
interest by, the Federal National Mortgage Association; or In guaranteed portions of Small Business
Administration notes; or in obligations, participations, or other instruments of, or issued by, a federal
agency or a United States government-sponsored enterprise.
(D Bills of exchange or time drafts drawn on and accepted by a commercial bank, otherwise known as
bankers acceptances • • •. Purchases of bankers acceptances may not exceed 270 days maturity or 40
percent of the agency's surplus money that may be invested pursuant to this section. However, no more
than 30 percent of the agency's surplus funds may be invested in the bankers acceptances of any one
commercial bank pursuant to this section.
This subdivision does not preclude a municipal utility district from investing any surplus money in its
treasury in any manner authorized by the Municipal Utility District Act, Division 6 (commencing with
Section 11501) of the Public Utilities Code.
(g) Commercial paper of "prime" quality of the highest ranking or of the highest letter and numerical
rating as provided for by Moody's Investors Service, Inc., or Standard and Pooes Corporation. Eligible
paper is further limited to issuing corporations that are organized and operating within the United States
and having total assets in excess of five hundred million dollars ($500,000,000) and having an "A" or
higher rating for the issuer's debt, other than commercial paper, if any, as provided for by Moody's
Investors Service, Inc., or Standard and Pwes Corporation. Purchases of eligible commercial paper may
not exceed 180 days maturity nor represent more than 10 percent of the outstanding paper of an issuing
corporation. Purchases of commercial paper may not exceed 15 percent of the agency's surplus money
that may be invested pursuant to this section. An additional 15 percent, or a total of 30 percent of the
agency's surplus money, may be invested pursuant to this subdivision. The additional 15 percent may be
so invested only if the dollar -weighted average maturity of the entire amount does not exceed 31 days.
"Dollar -weighted average maturity" means the sum of the amount of each outstanding commercial paper
investment multiplied by the number of days to maturity, divided by the total amount of outstanding
commercial paper.
(h) Negotiable certificates of deposits issued by a nationally or state -chartered bank or a state or
federal association (as defined by Section 5102 of the Financial Code) or by a state -licensed branch of a
foreign bank. Purchases of negotiable certificates of deposit may not exceed 30 percent of the agency's
surplus money which may be invested pursuant to this section. For purposes of this section, negotiable
certificates of deposits do not come within Article 2 (commencing with Section 53630) • • •, except that
the amount so invested shall be subject to the limitations of Section 53638.
(i) Investments in repurchase agreements or reverse repurchase agreements of any securities autho-
rized by this section, as long as the proceeds of the reverse repurchase agreement are invested solely to
supplement the income normally received from these securities. Investment in a reverse repurchase
agreement shall be made only upon prior approval of the legislative body of the local agency. For
purposes of this section, the term "repurchase agreement" means a purchase of securities by the local
agency pursuant to an agreement by which the seller will repurchase the securities on or before a
specified dateand for a specified amount and will deliver the underlying securities to the local agency by
book entry, physical delivery, or by third -party custodial agreement. The transfer of underlying
securities to the counterparty bank's customer book -entry account may be used for book -entry delivery.
The term "counterparty" for the purposes of this subdivision, means the other party to the transaction.
A counterparty bank's trust department or safekeeping department may be used for physical delivery of
the underlying security. The term of repurchase agreements shall be for one year of less. The term
"securities, for purpose of repurchase under this subdivision, means securities of the same issuer,
description, issue date, and maturity.
The term "reverse repurchase agreement" means a sale of securities by the local agency pursuant to an
agreement by which the local agency will repurchase those securities on or before a specified date and for
a specified amount.
Q) Medium -tern notes of a maximum of five years maturity issued by corporations organized and
operating within the United States or by depository institutions licensed by the United States or any
state and operating within the United States. Notes eligible for investment under this subdivision shall
be rated in a rating category of "A" or its equivalent or better by a nationally recognized rating service.
Purchases of medium-term notes may not exceed 30 percent of the agency s surplus money which may be
invested pursuant to this section.
Additions or changes Indicated by underline; deletions by asterisks • • `
149
§53601 GOVERNMENT CODE
(k) Shares of beneficial interest issued by diversified management companies, as defined in Section
23701m of the Revenue and Taxation Code, investing in the securities and obligations as authorized by
subdivisions (a) to (1), inclusive, of this section and which comply with the investment restrictions of this
article and Article 2 (commencing with Section 53630). To be eligible for investment pursuant to this
subdivision, these companies shall either.
(1) Attain the highest ranking or the highest letter and numerical rating provided by not less than two
of the three largest nationally recognized rating services • ' '.
(2) Retain an investment adviser registered with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and obligations as authorized by subdivisions
(a) to (m), inclusive, ' -' • and with assets under management in excess of five hundred million dollars
($500.0001000).
The purchase price of shares of beneficial interest purchased pursuant to this subdivision shall not
include any commission that these companies may charge and shall not exceed 15 percent of the agency's
surplus money that may be invested pursuant to this section .
(1) Notwithstanding anything to the contrary contained in this section. Section 53635, or any other
provision of law, moneys held by a trustee or fiscal agent and pledged to the payment or security of
bonds or other indebtedness, or obligations under a lease, installment sale, or other agreement of a local
agency, or certificates of participation in those bonds, indebtedness, or lease installment sale, or other
agreements, may be invested in accordance with the statutory provisions governing the issuance of those
bonds, indebtedness, or lease installment sale, or other agreement, or to the extent not inconsistent
therewith or if there are no specific statutory provisions, in accordance with the ordinance, resolution,
indenture, or agreement of the local agency providing for the issuance. '
(m) Notes, bonds, or other obligations that are at all times secured by a valid- fust priority security
interest in securities of the types listed by Section 53651 as eligible securities for the purpose of securing
local agency depositshavinga market -value at least equal to that required by Section 53652 for the
purpose of securing localagency deposits. The securities serving as collateral shall be placed by delivery
or book entry into the custody of a trust company or the trust department of a bank which is not
affiliated with the issuer of the secured obligation, and the security interest shall be perfected in
accordance with the requirements of the Uniform Commercial Code or federal regulations applicable to
the types of securities in which the security interest is granted.
(n) Any mortgage pass-through security, collateralized mortgage obligation, mortgage-backed or other
pay -through bond, equipment lease -backed certificate, consumer receivable pass-through certificate, or
consumer receivable -backed bond of a maximum of five years maturity. Securities eligible for investment
under this subdivision shall be issued by an issuer having an "A" or higher rating for the issuer's debt as
provided by a nationally recognized rating service and rated in a rating category of "AA" or its equivalent
or better by a nationally recognized rating service. Purchase of securities authorized by this subdivision
may not exceed 20 percent of the agency's surplus money that may be invested pursuant to this section.
(Amended by Stats.1983, c. 550, § 1; Stats.1983, c. 567, § 1.5; Stats.1984, c. 659, § 2; Stats.1984, c. 741,
§ 1; Stats.1985, c. 983, § 14, eff. Sept. 26,1985; Stats.1985, c. 983, § 15, eff. Sept. 26, 1985, operative Jan.
1, 1988; Stats.1985, t 1526, § 1; Stats.19851 c. 1526, § 1.5, operative Jan. 1, 1988; Stats.1986, c. 784, § 1;
Stats -1986, c. 784, § 2, operative Jan. 1, 1988; Stats.1986, c. 853, § 1, eff. Sept. 17, 1986; Stats.1986, c.
853, § 2, operative Jan. 1, 1987; Stats.1986, e. 853, § 1.5; Stats.1986, c. 853, § 2.5, operative Jan. 1, 1988;
Stats -1987, e. 446, § 1; Stats.1987, e. 887, § 3.5; Stats.1988, c. 294, § 1, eff. July 7, 1988; Stats.1988, c.
491, § 1; Stats.1992, c. 173 (AB.3576), § 1; Stats.1994, c. 705 (S.B.1804), § 10.)
Historical and Statutory, Notes
1983 legislation.
Amendment of this section by 9 1.5 of Stats.1983, e
550, Failed to become operative under the provisions of 9 3
of that Act
Amendment of this section by § 1 of Stats.19M c. 567,
failed to become operative under the provisions of 9 3 of
that Act
Effect of amendment of section by two or more acts at
the same session of the legislature, see Government Code
9 9606.
1984 Legislation
Amendment of this section by Stats.1984, e. 659, 9 2,
Section 12 of Stats.1984, c. 659, provided;
"Sections 2 to 9, inclusive, of this act shall become
operative upon the amendment of subdivision (b) of Sec-
tion 11 of Article 11 of the California Constitution [AC.A.
No. 21 (1984) not voted upon in 19841 authorizing the
Legislature to provide for the deposit of public moneys in
any federal or state credit union in this state."
1985 Legislation
Amendment of this section by § 14.5 of Siats.1985. c.
983, failed to become operative under the provisions of
§ 27 of that Act
contingent upon approval of ACA No. 21(1984), became Amendment of this section by 9' 15.5 of Stats -1985. C.
operative when A.C.A. No. 21 (1984) was approved at the 983, failed to become operative under the provisions of
primary election held June 3, 1985. § 28 of that Act.
Additions or changes Indicated by underline; deletions by asterisks • '
150
GOVERMENT CODE
1986 Legislation
.Vnendment of this section by 4 iS of Stata.1986, e.
78i. failed to become operative under the provisions of 4 5
of that Act
.Amendment of this section by § 2.5 of Suate.1986, c.
G, failed to become operative under the provisions of 1 5
of that Act
Section 5 of Stat3.1986,, c. 853, provides;
^Sections 1.5 and 2.5 of this bill incorporate amend-
ments to Section 53601 of the Government Code proposed
b)' both this bill and All 2595 (Stats.1986,. c. 784). Sm -
Long 3.5 and 4.5 of this bill incorporate amendments to
Section 53635 of the Government Code proposed by both
this bill and AB 2595. Those sections shall only become
operative if (1) both bills are enacted and become effective
on or before January 1, 1987, but this bill becomes opera-
tive first, (2) each bill amends Sections 53601 and 53635 of
the Government Code. and (3) this bill is enacted after AB
X95, in which case Section 53501 of the Government
Code, as amended by Sections 1 and 2 of this bill. and
Section 553635 of the Government Code, as amended by
Sections 3 and 4 of this bill, shall remain operative only
until the operative date of AB 2595. at which time Seo-
§ 53602
tions I.S. 2.5, 3.5, and 4.5 of this bill shall become opera-
tive."
1987 Legislation
Under the provisions of 16 of Stats.1987, a 887, the
1987 amendments of this section by 445 and c. 887 were
a
given effect and incorporated in the form act forth in 1 3.5
of C. 882 An amendment of this section by 1 3 of
Stats.1987, c. 887, failed to become operative under the
provisions of 16 of that Act
Amendment of this section by Stats -1984, c. 741, § 1;
Stats.1985, c. 983, § 14; Stats.19a c. 1526, 4 1; Stats.
1986, c. 784, § 1; Stats -1986- c. 853, § 1; Stats -1986, c.
853, § 1.6, was a temporary provision and. by its own
terms was repealed on Jan. 1, 1988, at which time the text
of this section as amended by Stats.198% C. 567, § 1.5, and
kuther amended by Stats.1984, c. 659, § 2; Stats.1985, c.
§82; ¢States 86, c. 953. 1 2; Stata19% c1 853,c4 2S:
State.1987, d 446, § 1; and Stats -1987- c. 887, 9 3.5 be-
came operative.
1988 Legislation
Effect of amendment of section by two or more acts at
the same session of the legislature, see Government Code
§ 9605.
Code of Regulations References
Contract periods, see 2 Cal Code of Reg& 1599.943.
Investments, see 2 Cal Code of Reg& 1599.942.
Library References
Words and Phrases (Perm Ed.)
¢ 53661.1. Investment in financial futures or financial option contracts
The authority of a local agency to invest funds pursuant to Section 53601 includes, in addition thereto,
authority to invest in fmaneial futures or financial option contracts in any of the investment categories
enumerated in that section-
(Added
ection
(Added by Stats -1983, c. 534. § 3.)
Library References
Counties a 15CL
C.J.S. Counties § 229.
¢ 53601.5. lnvestments;. qualified purchase agent
n 63601 or
The purchase by a local agency of any investment authorized
from an institutionrsuant licensed by the state as a
purchased directly from the issuer, shall be Purchased
broker-dealer, as defined in Section .25004 of the Corporations Code, or from a member of a federally
regulated securities exchange, from a national or state -chartered bank, from a federal or state association
(as defined by Section 5102 of the Financial Code) or from a brokerage firm designated as a primary
government dealer by the Federal Reserve bank. 16, eft Sept. 26, 1985.)
(Added by Stats.1984, c. 929, § I. Amended by Stats -IM. C- 983, §
§ 53602• Investment In legal investments for savings banks; securities of public districts
Code of Regulations References
Contract peTiod% see 2 CaL Cods of Rego. 1599.943.
Investments. ase 2 Cat. Code of Regs, i 699.90L
Additions or changes indicated-byunderlins
-151 ; deletions by asterisks
GOVERNMENT CODE
4 53602.1
Repealed
4 53602.1. Repealed by Stats -1990, c. 216, 4 40
Historical and Statutory Notes
Prior to repeal 158602.1 was amended by Stats -1986, c.
�
8 m the
section would haver no form effect after Jan. 1e1989.
g 53608. Deposit of securities; receipt; delegation of authority
The legislative body of a local agency may deposit for safekeeping with a federal or state association (as
defined b Section 5102 of the Financial Code), a trust company or a state or national bank located within
this state or with the Federal Reserve Bank of San Francesco or any branch thereof within this state, or
with any Federal Reserve bank or with any state or national bank located in any city designated bi a
reserve city by the Board of Governors of the Federal Reserve etisy em the bonds, noteer evidences of indebtedness
debentures, obligations, certificates of indebtedness, warrants,
or which the money of the local agency is invested pursuant to this article or pursuant to other legislative
authority. The local agency shall take from such financial institution
a receidelegated for securities
the legislatiso ve body
The authority of the legislative body to deposit for safekeeping Y
to the treasurer of the local agency; the treasurer shall not be responsible for securities delivered to and
receipted for by a financial institution until they are withdrawn from the financial institution by the
treasurer.
(Amended by Stats.1985, c. 983, .4 17, eff. Sept. 26, 1985.)
Article 2
DEPOSIT OF FUNDS
Section Section 536,52, Value required to secure active or inac-
53632.5. Classes en s; quah'fied pufor urrchase agent. tive deposits; market value.
63635.5. Investments; 9 P 53=. Waiver of security; federally insured de -
53635.6. Inoperative. posits; interest.
53648.5. Termination of agreement with deposito- 53657 Authorization to act as agent of deposi-
ry, - tory; application; agents eligible on
536512. Eligible security. December al, 1986.
MIA. Report of independent certified public 63661, Administrator.
accountant; depository using eligible 53079.1. Accounting practices; declaration of ex -
securities; state bank. national bank; isting law.
fee 53684• Local agencies; excess funds; invest -
53651.6. Letter of credit: terms•
went by county treasurer.
4 &%M. Definitions
As used in this article: including a chartered city or county, a
(a) "Local agency" means county, city, city and county, -
community college district, or other public agency or corporation in this state.
(b) 'Treasurer" means treasurer of the local agency. a
(c) "Depository,' means a state or national bank, savings association or federal association, « "
company, vi this state in which the
state or federal credit union or a federall insured industrial loan
moneys of a local agency ari deposited.
(d) "Agent of depository" means a trust company or trust department of a state or national bank
located in this state, including the trust department of a depository where authorized, and the Federal
Home Loan Bank of San Francisco, which is authorized to act as an agent of depository for the purposes
of this article pursuant to Section 53657.
- (e) "Security" means any of the eligible securities or obligations listed in Section 5365t.
(D "Pooled securities" means eligible securities held by an agent of depository for a depository and
securing deposits of one or more local agencies.
(g) «Administrator" means the Administrator of Local Agency Security of the State of California.
on, savings and loan associa-
(h) "Savings association or federal association" means a savings associati
tion, or savings bank as defined by Section 5102 of the Financial Code. --
Additions or changes Indicated by underline; deletions by asterisks
152 • ` `
GOVERNMENT CODE §53635
(i For purposes of being a depository of moneys belonging to or being in the custody of a local agency,
the phrases state or national bank located in this state," "state or national bank," "state or national bank
in this state," and "state or national banks in the state" include a foreign bank licensed under Article 3
(commencing with Section 1750) of Chapter 13.5 of Division 1 of the Financial Code to maintain a branch
office in this state or authorized under federal law to maintain a federal branch in this state.
(Amended by Stats.1984, c. 659, § 3;- Stats.1984, c. 868, § 18; Stats.1984, c. 1226, § 2; Stats.1985, c. 983.
§ 18, eff. Sept. 26, 1985; Stats.1986, c. 1132, § 1; Stats.1987, c. 887, § 4; Stats.1988, c. 1004, §. 1.)
Historical and Statutory Notes
1984 Legislation
Amendment of this section by Stats.1984, c. 659, 13.
contingent upon approval of ACA. No. 21(1984), became
operative upon approval of ACA. No. 21 (1984) at the
primary election held Tune 3. 1986.
Effect of amendment of section by two or mote acts at
the same seasion of the legislature. see Government Code
1 9605.
1996 Legislation
Section 33 of Stats,1986, c. 1132, provides:
"The amendment of subdivision (a) of Section 53630 of
the Government Code made by Section 1 of this act does
not constitute a change in, but is declaratory of, the
existing law."
¢ 53632. Classes of deposits
There are three classes of deposits:
(a) Inactive deposits.
(b) Active deposits.
(c) Interest-bearing active deposits.
(Amended by. Stats.1983, a 105, § 1.5.)
§ 5X12.5. Classes of security for deposits
1988 Legislation
The 1988 amendment inserted "or a federally insured
industrial loan comPRW N subd (c) defining "deposito-
ry+; inserted subd. (i) defining "federally insured industri-
al loan company+; and made nonsubstantive changes.
Section 8 of Stats.1988, e. 1004, provides:
"Sections 1 to 7, inclusive, of this act shall become
operative only if Assembly Constitutional Amendment No.
63 of the 1987-88 Regular Session (Proposition 88, 114M
election] is adopted by the people, in which case Sections 1
to 7, inclusive, of this act shall become operative at the
same time as the constitutional amendment RM881 or
January 1, 1989, whichever is later."
There are three classes of security for deposits:
(a) Securities described in subdivision (m) of Section 53651.
(b) Securities described in subdivision (p) of Section 53651.
(c) Securities enumerated in Section 53651, except for those described in subdivisions (m) and (p) of
that section.
(Added by Stats.1983, c. 105, § 2. Amended by Stata1986, c. 1132, § 2.)
§ 53633. Determination of amounts to be deposited in each class
The treasurer shall determine the amounts of money to be deposited as inactive, active, and interest-
ttEtM active deposits, except asotherwise provided in Section 53679.
(Amended by Stats.1983, c, 105, § 3.)
53635. Funds of local agency,,. deposit or investment
As far as possible, all money belonging to, or in the custody of, a local agency, including money paid to
the treasurer or other official to pay the principal, interest, or penalties of bonds, shall be deposited for
safekeeping in state or national banks, savings associations or federal associations, credit unions, or
federally insured industrial loan companies in this state selected by the treasurer or other official having
the legal custody of the money; or, unless otherwise directed by the legislative body pursuant to Section
53601, may be invested, in the following:
(a) Bonds issued by the local agency, including bonds payable solely out of the revenues from a
revenue-producing property owned, controlled, or operated by the local agency or by a department,
board, agency, or authority of the local agency.
Additions or changes Indicated by underline; deletions by asterisks
153
§ 53635 GOVERNMENT CODE
(b) United States Treasury notes, bonds, bills, or certificates of indebtedness, or those for which the
faith and credit of the United States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this state. including bonds payable solely
out of the revenues from a revenue-producing property owned. controlled, or operated by the state or by
a department, board, agency, or authority of the state.
(d) Bonds, notes, warrants, or other evidences of indebtedness of anincludiny local agency within this state,
es
m a
or operaged by the bonds local able solely
agency, or byout of ea depuartment. board, agency. or utphority of theed. localnagency.
(e) Obligations issued by banks for cooperatives, federal land banks, federal intermediate credit banks.
federal home loan banks, the Federal Home Loan Bank, the Tennessee Valley Authority, or in
obligations, participations, or other instruments of, or issued by, or fully guaranteed as to principal and
interest by, the Federal National Mortgage Association; or in guaranteed portions of Small Business
Administration notes; or in obligations, participations, or other instruments of, or issued by, federal
agency or a United States government-sponsored enterprise.
(f) Bills of exchange or time draft drawn on and accepted by a commercial bank, otherwise known as
bankers acceptances, which are eligible for purchase, by the Federal Reserve System. Purchases of
bankers acceptances may not exceed 270 days maturity or 40 percent of the agency's surplus funds which
may be invested pursuant to this section. However,no more than 30 percent of the agency's surplus
funds may be invested in the bankers acceptances of any one commercial ban1cpursuant to this section.
This subdivision does not preclude a municipal utility district from investing any surplus money in its
treasury in any manner authorized by the Municipal Utility District Act, Division 6 (commencing with
Section 11501) of the Public Utilities Code.
(g) Commercial paper of "prune" quality of the highest ranking or of the highest letter and numerical
Service, Inc., or Standard and Poors Corporation. Eligible
rating as provided for by Moody's Investors
paper is further limited to issuing corporations that are organized and operating within the United States
and having total assets in excess of five hundred million dollars ($500,000,000) and having an "A" or
higher rating for the issuer's debt, other than commercial paper,. if any, as provided for by Moody's
Investors Service, Inc., or Standard and Poor's Corporation. Purchases of eligible commercial paper may
not exceed 180 days maturity nor represent more than 10 percent of the outstanding paper ssng.
corporation. Purchases of commercial paper may not exceed 15 percent of the agency's surplus money
which may be invested pursuant to this section. An additional 15 percent, or a total of 30 percent of the
agency's money or money in its custody, may be invested pursuant to this subdivision. The additional 15
percent may be so invested only if the dollar -weighted average maturity of the entire amount does not
exceed 31 days. "Dollar -weighted average maturity" means the sum of the amount of each outstanding
- commercial paper investment multiplied by the number of days to maturity, divided by the total amount
of outstanding commercial paper.
(h) Negotiable certificates of deposit issued by a nationally or stat"hartered bank or a savings
association or federal association or a state or federal credit union or by a state -licensed branch of a
foreign bank Purchases of negotiable certificates of deposit may not exceed 30 percent of the agencys
surplus money which may be invested pursuant to this section. For purposes of this section, negotiable
certificates of deposit do not come within Article 2 (commencing with Section 53630) of Chapter 4 of Part
1 of Division 2 of Title 5, except that the amount so invested shall be subject to the limitations of Section
53638. For purposes of this section, the legislative body of a local agency and the treasurer or other
official of the local agency having legal custody of the money are prohibited from depositing or investing
local agency funds, or funds in the custody of the local agency, in negotiable certificates of deposit issued
by a state or federal credit union if a member of the legislative body of the local agency, or an employee
of the administrative officer, manager's office, budget office, auditor -controllers office, or treasurers
office of the local agency also serves on the board of directors, or any committee appointed by the board
of directors, or the credit committee or supervisory committee of the state or federal credit union issuing
the negotiable certificates of deposit. -
(i) Investments in repurchase agreements or reverse repurchase agreements of any securities autho-
rized by this section, so long as the proceeds of the reverse repurchase agreement are invested solely to
supplement the income normally received from these securities. Investment in a reverse repurchase
agreement shall be made only upon prior approval of the legislative body of the local agency. For
purposes of this section, the term "repurchase agreement" means a purchase of securities by the local
agency pursuant to an agreement by which the seller will repurchase the securities on or before a
specified date and for a specified amount and will deliver the underlying securities to the local agency by
book entry, physical delivery, or by third -party custodial agreement_ The .transfer of underlying
securities to the counterparty bank's customer book entry account may be used for book entry delivery.
The term "counterparty" for the purposes of this subdivision, means the other party to the transaction.
A counterparty bank's trust department or safekeeping department may be used for physical delivery of
Additions or changes Indicated by underline; deletions by asterisks
154
GOVERNMENT CODE § 53635
the underlying security. The term of repurchase agreements shall be for one year or less. The term
"securities," for purpose of repurchase under this subdivision, shall mean securities of the same issuer,
description, issue date, and maturity.
The term "reverse repurchase agreement" means a sale of securities by the local agency pursuant to an
agreement by which the local agency will repurchase such securities on or before a specified date and for
a specified amount.
Q) Medium-term notes of a maximum of five years' maturity issued by corporations organized and
operating within the United States or by depository institutions licensed by the United States or any
state and operating within the United States. Notes eligible for investment under this subdivision shall
be rated in a rating category of "A" or its equivalent or better by a nationally recognized rating service.
Purchases of medium-term notes may not exceed 30 percent of the agency's surplus money which may be
invested pursuant to this section.
(k) Shares of beneficial interest issued by diversified management companies, as defined in Section
23701m of the Revenue and Taxation Code, investing in the securities and obligations as authorized by
subdivisions (a) to (k), inclusive, of this section and which comply with the investment restrictions of this
article and Article 1 (commencing with Section 53600). To. be eligible for investment pursuant to this
subdivision, these companies shall either. (1) attain the highest ranking or the highest letter and
numerical rating provided by not less than two of the three largest nationally recognized rating services,
or (2) have an investment adviser registered with the Securities and Exchange Commission with not less
than five years' experience investing in the securities and obligations as authorized by subdivisions (a) to
(m), inclusive, of this section and with assets under management in excess of five hundred million dollars
($500,000,000). The purchase price of shares of beneficial interest purchased pursuant to this subdivision
shall not include any commission that these companies may charge and shall not exceed 15 percent of the
agency's surplus money which may be invested pursuant to this section.
(1) Notes, bonds, or other obligations which are at all times secured by a valid fust priority security
interest in securities of the types listed by Section 53651 as eligible securities for the purpose of securing
local agency deposits having a market value at least equal to that required by Section 53652 forthe
purpose of securing local agency deposits. The securities serving as collateral shall be placed by delivery
or book entry into the custody of a trust company or the trust department of a bank which is not
affiliated with the issuer of the secured obligation, and the security interest shall be perfected in
accordance with the requirements of the Uniform Commercial Code or federal regulations applicable to
the types of securities in which the security interest is granted.
(Amended by Stats.1983, c. 550, 12; Stats.1983, c. 567, § 2.5; Stats.1984, c. 659, § 4; Stats.1984, c. 741,
§ 2; Stats.1985, c. 983, § 19, eff. Sept. 26, 1985; Stats.1985, c. 983, § 20, operative Jan 1, 1988;
Stats.1985, c. 1526, § 2; Stats.1985, a 1526, § 2.5, operative Jan 1, 1988; Stats.1986, c. 784, § 3;
Stats.1986, c. 784, § 4, operative Jan. 1, 1988; Stats.1986, c. 853, § 3, eM Sept. 17, 1986; Stats.1986, e-
853, § 4, operative Jan. 1, 1987; Stats1986, c. 853, § 3.5; Stats.110, e. 853, § 4.5, operative Jan. 1,1988;
Stats -1987, c. 446, § 2; Stats -1987, a 887, § 5.5; Stats.1988, c. 294, § 2, eff. July 7, 1988; Stats.1988, c.
491, § 2; Stats.1988, c. 1004, § 2; Stats.1992, e. 173. (A.B.3576), § 2.)
Historical and Statutory Notes
1983 Legislation.
Amendment of this section by § 2.5 of Stats.1983, t
550, failed to become operative under the provisions of § 4
of that Act
Amendment of this section by § 2 of Stat&IM t 567,
failed to become operative under the provisions of § 4 of
that Act
Effect of amendment of section by two a more acts at
the same session of the legislature, see Government Code,
§ 9605.
1994 Legislation
Amendment of this section by Stats.1984, t 659, § 4.
contingent upon approval of ACA No. 21(1984), became
operative upon the approval of ACA No. 21 (19M) at the
primary election held June 3, 1986.
1985 Legislation
Amendment of tlds section by § 19.5 of Stats.1985, c.
963, failed to become operative under the provisions of
§ 29 of that Act
Amendment of this section by § 20.5 of Stats.1985, C.
983, failed to become operative under the provisions of
§ 30 of that Act
19M Legislation
Amendment of this section by 13.5 of Stats19K t
784, failed to become operative under the provisions of § 5
of that Act
Additions or changes Indicated by underline; deletions by asterisks • • `
155
§ 53635
Amendment of this section by § 4.5 of Stats.1986, e
784, failed to become operative under the provisions of § 5
of that Act
operative effect of 1986 amendments, see Historical
Note following § 53661.
1987 Legislation
Under the provisions of § 6 of Stats.1987, c. 887. the
1987 amendments of this section by c. 446 and c. 887 were
given effect and incorporated in the form set forth in § 5.5
of c. 887. An amendment of this section by § 5 of
Stats.1987, c. 887, failed W become operative under the
provisions of § 6 of that Act
Amendment of this section by Stats,1984. c. 741. § 2:
1986, c98�a § 3. stata.i986tae &M.985. 1 3; st26 ats 1986 mac.
GOVERNMENT CODE
852 § 3.5, was a temporary provision and. by its own
terms, was repealed on Jan. 1. 1988, at which time the text
of this section as amended by Statsaw. c, 567, § 2.5, and
furthe983, §r 20; amended
Stats.1985 c,l 6, § 2.59 Stan1986. c.7784.
§ 4: Stats.1986. C. 853. § 4: Stats -1986, c. 853. § 4.5:
Stats.1987, e. 446, § 2: Stau.IN7, c. 887; § 5.5, became
operative.
1988 Legislation
1988 amendment became operative upon adoption of
ACA No. 63 (Prop. 881 at the general election Nov. S.
1988.
Effect of amendment of section by two or more sets at
the same session of the legislature. ase Government Code
§ 9605.
Cross References
Water districts, defeasance or call for redemption of
refunding bonds, requirements, ase Water Code § 36064. .
Library References
Words and Phrases (Perm Ed.)
§ 53635.5. investments; qualified purchase agent -
The purchase by a local agency of any investment authorized pursuant to Section 53635, not purchased
directly from the issuer, shall be purchased either from an institution licensed by the state as a broker-
dealer, as defined in Section 25004 of the Corporations Code, or from a member of a federally regulated
vings ass! . tion or a federal
securities exchange, from a national of state -chartered bank, from a government dealer bLci�uopy the Federal
` a association, or from a brokerage firm designated as a primary
Reserve bank.
(Added by Stats -19M, e. 929, § 2. Amended by Stats.1985. c. 983, § 21, efY. Sept 26,1985; Stats.l9Sti. c.
1132, § 4.)
Historical and Statutory Notes
1986 Legislation
Former § 63635.5, added by Stats -1976. a 506. P. 1527,
repeand amended aled by Stats.I 86se. 113211 3.67• P. 153.426, was
§ 53635.6. Inoperative
Renumbering of this section by § 88 of Stam -1W. c..
24& failed to become operative under the subordimuil-
provimos of § 277 of that Act
Historical and Statutory Notes
Renumbering of § 53635.5 to be this section by § 88 of
Stats.1986, c. 248, failed to become operative under the
provisions of § 277 of that Act
53631. Selection of depositary. interest
The money shall be deposited in any bank, savings association or federal association, • ` ' state
um
federal credit union, or federally insured industrial loan
except that money shall not be deposited it ta.-
return, consistent with prudent financial manag
state or federal credit union if a member of the legislative body of a local agency, or an employee of t'-
administrative
'administrative office, manager's office, budget office, auditor -controller's office, or treasurer's
office
u sero-
local agency, also serves on the board of directors, or any committee appointed by
or the credit committee or supervisory committee, of the state or federal credit union.
(Amended by Stats -19M, c. 659. § 5; Stats -1986, c. 1132, § 6; Stats.19S8, c. 1004, § 21.)
Additions or changes indicated by underline; deletions by. asterisks "
156
GOVERNMENT CODE
§ 53643
Historical and Statutory Notes
1984 Legislation
Amendment of this section by § 89 of Stata.1986, c.248.
Amendment of this section by Stata1984, c. 659, § 5,
failed to become operative under the provisions of $ 277
contingent upon approval of ACA No. 21 (1984), became
of that Act
operative upon approval of A.CA No. 21 (1%4) at the
primary election held June 3, 1986.
1988 Legislation '
1986 Legislation
Operation of 1988 amendment, see Historical and Statu-
Amendment of this section by Stats.1985, C. 983, § 22,
tory Notes under § 53630.
was repealed by Stats.1986, c. 1132, § 5.
§ 53638. Maximum deposits
(a) The deposit shall not exceed the shareholder's equity of any depository bank For the purposes of
this subdivision, shareholder's equity shall be determined in accordance ce with Section 118 of the Financial
Code, but shall be deemed to include capital notes and debentures.
(b) The deposit shall not exceed the total of the net worth of any depository savings association or
federal association, except that deposits not exceeding a total of five hundred thousand dollars ($500.000)
may be made to a savings association or federal association without regard to the net worth of that
depository, if such deposits are insured or secured as required by law.
(c) The deposit to the share accounts of any regularly chartered credit union shall not exceed the total
of the unimpaired capital and surplus of the credit union, as defined by rule of the Commissioner of
Corporations, except that the deposit to any credit union share account in an amount not exceeding five
hundred thousand dollars ($500,000) may be made if the share accounts of that credit union are insured
or guaranteed pursuant to Section 14858 of the .Financial Code or are secured as required by law.
(d) The de osit in investment certi£cates of a federall insured industrial loan company shall not
exceed the total o the ununpaired capital and surplus of the insured industrial loan company.
(Amended by Stats.1984, c. 659, § 6; Stats.1986, e. 1132, § 8; Stats.1988, c. 1004, § 3.) '
Historical and Statutory Notes
1984 Legislation
Amendment of this section by Stats -1984,. c. 359, § 6,
contingent upon approval of ACA No. 21 (1984), became
operative upon approval of ACA No. 21 (1984) at the
primary election held June 3, 1986.
1986 Legislation
Amendment of this section by Stats.1995, a 983, § 23,
waa repealed by Stats1986, c. lla , § 7.
Amendment of this section by § 90 of Stats.1986, c 248.
failed to become operative under the provisions of $ 277
of that Act
1988 Legislation
The 1988 amendment added subd. (d) relating to invest-
ment certificate deposits of a federally insured Indusuial
ban company.
Operation of 1988 amendment, see Historical and Statu-
tory Notes under § 53630.
§ 53639. Expense of transporting money
Except as otherwise provided in Section 53682, the depository shall bear the expenses of transportation
of money to and from the depository.
(Amended by Stats.1983, c. 105, § 4; Stats.1986, c. 248, § 91.)
§ 53640. Checks, drafts, and other exchange
Except as otherwise provided in Section 53684 the depository shall handle, collect, and pay all checks,
draft, and other exchange without cost to the local agency.
(Amended by Stats.1983, c. 105, § 5; Stats.1986, e. 248, § 92.)
§ 53611. Receipt or other evidence of deposit
When money is deposited in a depository, the treasurer or other authorized official shall take and
preserve a receipt certificate of deposit, or other evidence of the deposit as he or she requires.
(Amended by Stats.1986, c. 248, § 93.) -
§ 53643. Deposit by treasurer
The treasurer may deposit any part of the money as agreed upon between the treasurer and the
depository.
(Amended by Stats.1983, c. 105, § 6; Stats.1986, e. 248, § 94.)
Additions or changes Indicated by underline; deletions by asterisks
157
§ 53644 GOVERNMENT CODE
§ 53644. Withdrawals on demand; penalties; notice
If an agreement is not made:
(a) Active deposits and interest thereon are subject to withdrawal upon the demand of the treasurer or
other authorized official subject to any penalties which may be prescribed by. federal law or regulation.
(b) Inactive deposits are subject to notice of at least thirty days before withdrawal.
(Amended by Stats.1983, c. 105, § 7.)
§-53615. Interest, computation
Interest shall be computed andpaid by the depository, as follows.
(a) For active deposits upon which interest is payable, interest shall be computed on the average daily
' • balance for the calendar quarter, and shall be paid quarterly
(b) For inactive deposits, interest shall be computed on a 360 -day basis and shall be paid quarterly.
(Amended by Stats.1986, c. 248, § 95; Stats.1992, a 523 (S.B.1683). § 5.3.)
§ 53646. Statement by treasurer showing accrued interest
The treasurer may render to the depositary and to the auditor, controller, secretary. or corresponding
officer of the local agency • e ' a statement showing the amount of accrued interest for each depositary
for the preceding quarter if so required by the legislative body of the local agency.
(Amended by Stats.1983, C. 105, § 8; Stats.1984, c. 1226, § 3; Stats.1985, c. 1526, § 3; Stats.1983, c. 105,
§ 8, operative Jan. 1, 1991; Stats.1993, c. 59(S.B.443), § 6, eff. June 30, 1993.)
Historical and Statutory Notes
1984 Legislation its own terms, was repealed on Jan. 1, 1991, at which time
Section 4 of Stats.1984. c. 1226, provides: the text of this section as amended by Stats.1983, c. 105,
"It is the intent of the Legislature that the provisions of § 8, again became operative. .
Section 3 of this act apply to all.local agencies, whether
chattered or not" 1993 Legislation
1985 Legislation Legislative findings, declarations and intent relating to
Amendment of this section by Stats.1984, c. 1226, § 3; Stats.1993, a 59 (S.B.443), see Historical and Statutory
Stats.1985, e. 1526, § 3, was a temporary provision and. by Notes under Education Code § 45452.
§ 53647. Interest; payment into fund
Notes of Decisions
2. Disposition of interest payments county as part of its general fund. Fresno Fire Fighters
Interest earned on monies deposited in civil actions is to Local 753 v.. Jernagan (App. 5 Dist.1986) = Cal.Rptr.
be returned to owner of monies, rather than retained by 886, 177 CAM 403.
§ 53647.5. Interest on bail money on deposit
Library References
Bail C-73.
C.J.S. Bail §§ 52, 53.
Notes of Decisions
1. In general Interest earned on cash bail deposits need nut be
County's retention of interest earned on rash bail de• returned to owner, but may be retained by county as part
posits in criminal actions was not an unconstitutional of its general fund. Fresno Fire Fighters Local 753 v.
taking of private property. Fresno Fre Fighters Local Jernagan (App. 5 Dist1986) 222 Cal.Rptr. W, I? C.A.-Id
753 v. Jernagan (App. 5 Dist1986) 222 Cal.Rptr. 886, 177 403
CAM 403. -
§ 53648. Deposits and contracts pursuant to federal law or rule
Notwithstanding this article, the treasurer may deposit moneys in, and enter into contracts with, a
state or national bank, savings association or federal association, e • e federal or state credit union, or
federally insured industrial loan company, pursuant to a federal law or a rule of a federal department or
Additions or changes Indicated by underline; deletions by asterisks
158
GOVERNMENT CODE § 53649
agency adopted pursuant to the law if the law or rule conflicts with this article in regulating the payment
of interest on deposits of public moneys by any of the following:
(a) Banks which are Federal Reserve System members or whose deposits are insured by the Federal
Deposit Insurance Corporation.
(b) Savings associations or federal associations which are federal home loan bank members or whose
deposits are insured by the Federal Savings and Loan Insurance Corporation.
(c) State or federal credit unions whose accounts are insured by the National Credit Union Share
Insurance Fund or guaranteed by the California Credit Union Share Guaranty Corporation or insured or
guaranteed pursuant to Section 14858 of the -Financial Code, unless a member of the legislative body of a
local agency, or an employee of the administrative office, manager's office, � budget office, auditor -
controller's office, or treasurer's office of the local agency, also serves on the board of directors, or any
committee appointed by the board of directors, or the credit committee or supervisory committee,. of the
state or federal credit union.
(d) A federally insured industrial loan company. -
(Amended by Stats.1984, c. 659, § 7; Stats.1986, c. 1132, § 10; Stats.1988, c. 1004, § 4.)
Historical and Statutory Notes
1981 Legislation 1988 Legislation
Amendment of this section by Stats.1984, c. 659, § 7, The 1988 amendment inserted "or federally insured
contingent upon approval of ACA No. 21 (1984), became industrial loan company" in the first sentence and added
operative upon approval of ACA No. 21 (1984) ac the su
primary election held June 3. 1986. bd. (d), "A federally insured industrial loan company."
1986 Legislation Operation of 1988 amendment, see Ristorical and Statu-
Amendment of this section by Stats.1985, e. 983, § 24, tory Notes under § 53630.
was repealed by Stats.1986, c. 1132, § 9.
§ 53648.5. Termination of agreement with depository
Upon the removal by federal law of the conflicting federal law or rule the agreement between the
treasurer or other authorized official and a depository may be terminated by either party.
(Added by Stats.1986, c. 1132, § 11.) _
§ 53649. Contracts with depositories; contents: fiHttg; - i
The treasurer is responsible for the safekeeping of money in his or her custody and shall enter into any
contract with a depository relating to any deposit which in his or her judgment is to the public advantage.
The depository, and the agent of depository to the extent the agent of depository has been notified of
deposits and the amount thereof, are responsible for securing moneys deposited pursuanttosuch a
contract in accordance with Section 53652. One copy of each • • • contract shall be filed with the
auditor, controller, secretary, or corresponding officer of the local agency. The contract-shalhltt"
(a)Fixthe duration of deposits if appropriate.
(b) Fix the interest rate, if any.
(c) Provide conditions for withdrawal and repayment,
(d) Provide for placement of pooled securities in a named agent of depository in accordance with
Section 53656.
(e) Grant authority for agent of depository to place securities for safekeeping in accordance with
Section 53659.
(f) Set forth in accordance with Section 53665 the conditions upon which the administrator shall order
pooled securities converted into money for the benefit of the local agency, and the procedure therefor.
(g) provide for compliance in all respects with the provisions of this article and other applicable
provisions of law.
(Amended by Stats.1983, C. 105, § 9; Stats.1986, c. 1132, § 12; Stats.1987, C. 841, § 1.)
Additions or changes Indicated by underline; deletions by asterisks
159
§ 53649
GOVERNMENT CODE
Code of Regulations References
Release of security, certification, see 2 Cal. Code of
Regs. 1 16003.3.6.
§ 53650. Repealed by Stats -1986, C. 1134 § 13
Historical and Statutory votes
See. now, § 53648.5. Amendment of this section by § 96 of Stats.1986, c. 248,
failed to become operative under the provisions of § 277
of that Act
4 5365L Eligible securities
Eligible securities are any of the following:
(a) United States Treasury notes, bonds, bills or certificates of indebtedness, or obligations for which
the faith and credit of the United States are pledged for the payment of principal and interest, including
the guaranteed portions of small business administration loans, so long as the loans are obligations for
which the faith and credit of the United States are pledged for the payment of principal and interest
(b) Notes or bonds or any obligations of a local public agency (as defined in the United States Housing
Act of 1949)1 or any obligations of a public housing agency (as defined in the United States Housing Act
of 1937) 3 for which the faith and credit of the United States are pledged for the payment of principal and
interest.
(c) Bonds of this state or of any local agency or district of the State of California having the power,
without limit as to rate or amount, to levy taxes or assessments to pay the principal and interest of the
bonds upon all property within its boundaries subject to taxation or assessment by the local agency or
district, and in addition, limited obligation bonds pursuant to Article 4 (commencing with Section 50665)
of Chapter 3 of Division 1, senior obligation bonds pursuant to Article 5 (commencing with Section 53387)
of Chapter 2.7, and revenue bonds and other obligations payable solely out of the revenues from a
revenue-producing property owned, controlled or operated by the state, local agency or district or by a
department, board, agency or authority thereof.
(d) Bonds of any public housing agency (as defined in the United States Housing Act of 1937, as
amended) 3 as are secured by a pledge of annual contributions under an annual contribution contract
between the public housing agency and the Public Housing Administration if such contract shall contain
the covenant by the Public Housing Administration which is authorized by subsection (b) of Section 22 of
the United States Housing Act of 1937, as amended, and if the maximum sum and the maximum period
specified in the contract pursuant to that subsection 22(b) shall not be less than the annual amount and
the period for payment which are requisite to provide for the payment when due of all installments of
principal and interest on the obligations.
(e)Registeredwarrants of this state.
(f) Bonds, consolidated bonds, collateral trust debentures, consolidated debentures, or other obligations
issued by the United States Postal Service, federal land banks 4 or federal intermediate credit banks 5
establishedunder the Federal Farm Loan AM, as amended,s debentures and consolidated debentures
issued by the Central Bank for Cooperatives 7 and banks for cooperatives established under the Farm
Credit Act of 1933,s as amended, consolidated obligations of the federal home loan banks established
under the Federal Home Loan Bank Acta bonds, debentures and other obligations of the Federal
National Mortgage Association 10 or of the Government National Mortgage Association 11 established
under the National Housing Act, as amended,lr bonds of any federal home loan bank established under
that act, bonds, debentures and other obligations of the Federal Home Loan Mortgage Corporation.
established under the Emergency Home Finance Act of 1970,13 and obligations of the Tennessee Valley
AUthority.14
(g) Notes, tax anticipation warrants or other evidence of indebtedness issued pursuant to Article 7
(commencing with Section 53820), Article 7.5 (commencing with Section 53840) or Article 7.6 (commencing
with Section 53850) of this Chapter 4.
(h) State of California notes.
(i) Bonds, notes, certificates of indebtedness, warrants or other obligations issued by: (1) any state of
the United States (except this state), or the Commonwealth of Puerto Rico, or any local agency thereof
having the power to levy taxes, without limit as to rate or amount. to pay the principal and interest of
such obligations, or (2) any state of the United States (except this state), or the Commonwealth of Puerto
Rico, or a department, board, agency or authority thereof except bonds which provide for or are issued
Additions or changes Indicated by underline; deletions by asterisks
160
GOVERNMENT CODE § 53651.2
pursuant to a law which may contemplate a subsequent legislative appropriation as an assurance of the
continued operation and solvency of the department, board, agency or authority but which does not
constitute a valid and binding obligation for which the full faith and credit of such state or the
Commonwealth of Puerto Rico are pledged, which are payable solely out of the revenues from a revenue-
producing source owned, controlled or operated thereby; provided the obligations issued by an entity
described in (1), above, are rated in one of the three highest grades, and such obligations issued by an
entity described in (2), above, are rated in one of the two highest grades by a nationally recognized
investment service organization that has been engaged regularly in rating state and municipal issues for a
period of not less than five years.
(j) Obligations issued, assumed or guaranteed by the International Bank for Reconstruction and
Development, Inter -American Development Bank, the Government Development Bank of Puerto Rico,
the Asian Development Bank, the International Finance Corporation, or the African Development Bank
(k) Participation certificates of the Export -Import Bank of the United States.
(1) Bonds and notes of the California Housing Finance Agency issued pursuant to Chapter 7
(commencing with Section 51350) of Part 3 of Division 31 of the Health and Safety Code.
(m) Promissory notes secured by fust mortgages and first trust deeds which comply with Section
53651.2.
(n) Any bonds, notes, warrants, or other evidences of indebtednessofa nonprofit corporation issued to
finance the construction of a school building or school buildings pursuant to a lease or agreement with a
school district entered into in compliance with the provisions of Section 39315 or 81345 of the Education
Code, and also any bonds, notes, warrants or other evidences of indebtedness issued to refinance those
bonds, notes, warrants, or other evidences of indebtedness as specked in Section 39317 of the Education
Code.
(o) Any municipal securities, as defined by Section 3(a)(29) of the Securities Exchange Act of June 6,
1934, (15 U.S.C. Sec. 78, as amended), which are issued by this state or any local agency thereof._
(p) With the consent of the treasurer, letters of credit issued by the Federal Home Loan Bank of San
Francisco which comply with Section 53651.6.
(Amended by Stats.1984, c, 997, § 5, eff. Sept. 11, 1984; Stats.1986, c. 1132, § 14; Stats.1987, c. 841, $ 2;
Stats.1988, c. 1112, § 1; Stats.1991, c. 1206 (S.B.1015), $ 7.)
142 U.S.CA $ 1460.
242 U.S.CA § 143%
342 U.S.CA § 1437a
4 12 U.S.C.& § 2011 et seq.
612 U.S.0-k $ 2071 et seq.
612 U.S.CA § 2001 et seq.
712 U.S.CA § 2121 et seq.
612 U.S.C.& § 2121 et seq.
s 12 U.S.CA § 1421 et seq.
1012 U.S.CA § 1716 et seq. -
1112 U.S.CA $ 1716 et seq.
1212 U.S.CA § 1701 et seq.
1212 U.S-CA § 1451 et. seq.
14 16 U.S.CA § 831 et seq.
Code of Regulations References
Security pools [REM, local agencies, see 2 Cal. Code of
Regs. § 16007.1.3 et seq.
§ 53651.2. Eligible security
(a) To be an eligible security under subdivision (m) of Section 53651, a promissory note placed in a
securities pool on or atter January 1, 1987, shall comply with all of the following provisions:
(1) Each promissory note shall be secured by a first mortgage or first trust deed on improved 1 to 4
unit residential real property located in California, shall be fully amortized over the term of the note, and
shall have a term of no more than 30. years. Any fust mortgage or fust trust deed which secures a
promissory note providing for negative amortization shall be removed from the securities pool an
Additions or changes indicated by underline; deletions by asterisks
161
§ 53651.2 GOVERN 1EIN"T CODE
(2) Each promissory note shall be eligible for sae to the Federal National Mortgage Association,,` he
Government National Mortgage Association, or the Federal Home Loan Mortgage
igae Corporation:
es pool
ed, however, that up to 25 percent of the total dollar amount of any promissory
established pursuant to Section 53658 may consist of promissory notes with loan amounts which exceed
the maximum amounts eligible for purchase by the Federal National Mortgage Association, the
Government National Mortgage Association, or the Federal Home Loan Mortgage Corporation, but
which do of exceed: W five hundred thousand dollars ($500.000) in the case of a single family dwelling:
(if) one million dollars gl,000,000) in the case of a 2. 3, or 4 unit dwelling.
(b) To be an eligible security under subdivision (m) of Section 53651, a promissory note which was
placed in a securities pool on or before December 31, 1986,and which remains in that securities pool
continuously thereafter shall comply with all the requirements of subdivision (m) of Section 53651, as in
effect on December 31, 1986, and of the regulations of the administrator adopted under that subdivision
(m), as in effect on December 31, 1986. _ ._ . , _
(2) This subdivision shall remain operative until January 1, 1994.
(c) The following shall not constitute eligible securities under subdivision (m) of Section 83651:
(1) Any promissory note on which any payment is more than 60 days past due.
(2) Any promissory note secured by a mortgage or deed of trust as to which there is a lien prior to the
mortgage or deed of trust. For the purposes of this paragraph, no lien specified in Section 766 of the
Financial Code shall be considered a prior encumbrance unless any installment or payment thereunder
(other than a rental or royalty under a lease) is due and delinquent.
(3) Any promissory note secured by a mortgage or deed of trust as to which a notice of default has
been recorded pursuant to Section 2924 of the Civil Code or an action has been commenced pursuant to
Section 725a of the Code of Civil Procedure.
(d) The depository may exercise, enforce, or waive any right granted to it by the promissory note,
mortgage, or deed of trust.
(e) For purposes of this article, the market value of a promissory note which is an eligible security
under subdivision (m) of Section 53651, shall be determined in accordance with the regulations adopted by
the Treasurer under paragraph (2) of subdivision (m) of Section 53651, as the regulations and statute
ations on the
the adminisin trator, the market valt on December 31, ue shall beede dend termined when
n accordance a with thoseect are regulationspofdby
the
administrator.
(Added by Stats.1986, c. 1132, 3 15. Amended by Stats.1987, c. 56, § 86; Stats.1988. c. 294. § 3. eR. Jac
7, 1988.)
§ 53651.4. Report b,nal f independent
certified
public accountant: depository using eligible securities:
(a) A depository which uses eligible securities of the class described in subdivision (m) of Section 53651
shall, within 90 days after the close of each calendar year or within a longer period as the administrator
may specify, file with the administrator a report of an independent certified public accountant regarding
compliance with this article and with regulations and orders issued by the administrator under this article
with respect to eligible securities of that class. The report shall be baseduponthe audit, shall contain
the information, and shall be in the form the administrator may prescribe. The depository shall preside
a copy of the report to the treasurer on request. '
(b) If a depository which is a state bank files with the administrator, not less than 90 days before the
beginning of the calendar year, a notice that it elects to be examined by the administrator instead of filing
a report of an independent certified public accountant under subdivision (a) for that calendar year, the
depository shall be exempt from subdivision (a) for that calendar year and shall for that calendar year• be
subject to examination by the administrator regarding eomphance with this article and with regulations
and orders under this article with respect to eligible securities of the class described in subdivision (mi of
Section 53651. The administrator shall provide a report to a treasurer with deposits in the examined
(c) A national bank may apply to the administrator to be examined, and the administrator, in his or her
discretion, may examine a national bank for the purposes ohs.4�is�fyit g n ththe examined n uirements tionaldbank u (an
Additions or changes indicated by under!!W deletions by asterisks
162
r
GOVERNMENT CODE
§ 53654 .
(d) Whenever the administrator examines a depository pursuant to subdivision (b) or (c), the deposito-
ry shall pay, within 30 days after receipt of a statement from the administrator, a fee of two hundred
dollars ($200) per day for each examiner engaged in the examination.
(Added by Stats.1986, c. 1132, § 16. Amended by Stats.1987, C. 841, § 3.)
§ 53651.6. Letter of credit; terms
(a) To be an eligible security under subdivision (p) of Section 53651, a letter of credit shall be in such
form and shall contain such provisions as the administrator may prescribe, and shall include all of the
following terms: _
(1) The administrator shall be the beneficiary of the letter of credit.
(2) The letter of credit shall be clean and irrevocable and shall provide that the administrator may
draw upon .it up to the total amount in the event of the failure of the depository savings association or
federal association or if the depository savings association or federal association refuses to permit the
withdrawal of funds by a treasurer.
(Added by Stats.1986, c. 1132, § 17.)
§ 53652. Value required to secure active or inactive deposits; market value
To secure active or inactive deposits a depository shall at all times maintain with the agent of
depository eligible securities in securities pools, pursuant to Sections 53656 and &MM, in the amounts
specified in this section. Uncollected funds shall be excluded from the amount deposited in the
depository when determining the security requirements for the deposits.
(a) Eligible securities, except eligible securities of the classes described in subdivisions (m) and (p) of
Section 53651, shall have a market value of at least 10 percent in excess of the total amount of all deposits,
of a depository secured by the eligible securities:
(b) Eligible securities of the class described in subdivision (m) of Section 53651 shall have a market
value at least 50 percent inexcess of the total amount of all deposits of a depository secured by those
eligible securities. .
(c) Eligible securities of the class described in subdivision (p) of Section 53651 shall have a market
value of at least 5 percent in excess of the total amount of all deposits of a depository secured by those
eligible securities. - For purposes of this article, the market value of a letter of credit which is an eligible
security under subdivision (p) of Section 53651 shall be the amount of credit stated in the letter of credit.
(Added by Stats.1986, c. 1132, § 19.)
Historical and Statutory Notes
1986 Legislation
Former § 53652 was repealed by Stats.1986, c.. 1132,
18.
$ 53653. Waiver of security; federally insured deposits; interest
When in his or her discretion local conditions so warrant, the treasurer may waive security for the
portion of any deposits as is insured pursuant to federal law, notwithstanding this article. For deposits
(Added by Stats.1986, c. 1132, § 21. Amended by Stats.1988, C. 156, § 1.)
Historical and Statutory Notes
1986 Legislation Derivation: Former § 536.53. added by Stats.1969, c.
Former § 53653, amended by Stats.1984, c. 659, § 8. 1483, p. 3035, § 5. amended by Stats.1984, c. 659, § 8.
relating to the same subject matter, was repealed by
Stats.1986. c. 1132, § 20.
4 53654. Addition or substitution of securities; withdrawal or release of securities
(a) The depository may add securities to the pool or substitute securities of equal value for those in the
pool at any time, but shall not interchange classes of security, as defined in Section 53632.5, without prior
approval of the treasurer.
Additions or changes Indicated by underline; deletions by asterisks
163
§53654 GOVERNMENT CODE
(b) Withdrawal of securities from the pool without replacement at equal value may be ordered only by
two duly authorized officers or employees of the depository who satisfy the requirements as may be set
by the administrator.
(c) The agent of depository is responsible for the safekeeping and disbursement of securities placed in
its custody by a depository. It shall release securities only upon presentation by the depository of the
most reasonably current statement of the total deposits subject to ttds article held by the depository, such
statement to be verged and countersigned by two dui authorized officers, other than those who • • '
ordered the withdrawal of securities. A copy of tthis sstatement shall forwarded to the administrator
concurrently by the agent of depository.:
(Amended by Stats.1983, c. 105, § 10; Stats.1986, c. 1132, § 22.)
Code of Regulations References
Withdrawal of a security, see 2 Cal. Code of Itegs.
§ 16003.3.2 at seq.
§ 53656. Authorization for holding of security by agent of depository; agents of depcisitory;
securities subject to order of depository; exception
(a) At the time the treasurer enters into a contract with the depository pursuant to Section 53649, he
or she shall authorize the agent of depository designated by the depository, but including the trust
department of the depository only when acceptable to both the treasurer and the depository, to hold
securities of the depository in accordance with this article to secure the deposit of the local agency.
(c) The securities are subject to order of the depository in accordance with Section 53654 except when
the provisions of subdivision (i) of Section 53661 and Section 53665 are in effect
(Amended by Stats.1986, c. 1132, § 23.)
§ 53657. Authorization to act as agent of depository; application; agents eligible on December 31.
1986
(a) No person shall act as an agent of depository unless that person is a trust company located in this
state, the trust department of a bank located in this state, or the Federal Home Loan Bank of San
Francisco, and is authorized by the administrator to act as an agent of depository.
(b) (1) An application for authorization shall be in such form, shall contain such information, shall be
signed in such manner, and shall (if the administrator so requires) be verified in such manner, as the
administrator may prescribe. _
(2) The fee for tiling an application for authorization with the administrator shall be five hundred
dollars ($500).
(3) If the administrator finds, with respect to an application for authorization, that the applicant is
competent to act as an agent of depository and that it is reasonable to believe the applicant will comply
with all applicable provisions of this article and of any regulation or order issued under this article. the
administrator shall approve the application. If the administrator finds otherwise, the administrator shall'
deny the application.
(4) When an application for authorization has been approved, the applicant shall file with the
administrator an agreement to comply with all applicable provisions of this article and of any regulation
or order issued under this article: The agreement shall be in such form, shall contain such provisions.
and shall be signed in such manner as the administrator may prescribe.
(5) When an' application for authorization has been approved, the applicant has complied with
paragraph (4), and all conditions precedent to authorizing the applicant to act as agent of depository have
been fulfilled, the administrator shall authorize the applicant to act as agent of depository.
(c) H a trust company located in this state, the trust department of a bank located in this state. or the
Federal Home Loan Bank of San Francisco was eligible to act as an. agent of depository on December 31.
1986, under Section 53657, as in effect on December 31, 1986, and the regulations adopted by thr
administrator under that Section 53657, as in effect on December 31, 1986, that institution shall, as et
January 1, 1987, be deemed to be authorized to act as agent of depository, and the administrator shall, as
of January 1, 1987, authorize that institution to act as an agent of depository.
(Added by Stats.1986, C. 1132, § 25.)
Additions or changes Indicated by underline; deletions by asterisks "
164
3OVERNMENT CODE § 53661
Historical and Statutory Notes
1986 Legislation
Former § 51657 was repealed by Stau.19s6, c. 1132,
§ 24.
Code of Regulations References
Eligibility to act as agent of depository, requirement,
see 2 Cal. Code of Regs. § 16002.1.1.
§ 53660. Certification and report by agent of depository
When deposits of a local agency are secured by pooled securities pursuant to Section 53656, the agent
of depository shall make available to the treasurer for review at a mutually agreed upon time and location
all of the following information which may be in the form of a copy of the report required in subdivision
(e) of Section 53661:
(a) A certification that there are securities in the pool in the amounts required by Section 53652 to
secure deposits_
(b) A certified report of the individual securities then on deposit in the pool with the location and total
market value thereof,
(c) The total amount of deposits then reported by the depository. to be secured by the pool
(Amended by Stats.1986, e. 1132, § 26.)
§ 53661. Administrator
(a) The Superintendent of Banks shall act as Administrator of Local Agency Security and shall be
responsible for the administration of Sections 53638, 53651, 53651.2, 53651.4, 53651.6, 53652, 63654, 53655,
53656, 53657, 53658, 53659, 53660, 53661, 53663, 53664, 53665, 53666, and 53667.
(b) The administrator shall have the powers necessary or convenient to administer and enforce the
sections specified in subdivision (a).
(c)(1) The administrator shall issue regulations consistent with law as the administrator may deem
necessary or advisable in executing the powers, duties, and responsibilities assigned by this article. The
regulations may include regulations prescribing standards for the valuation, marketability, and liquidity
of the eligible securities of the class described in subdivision (m) of Section 53651, regulations prescribing
procedures and documentation for adding, withdrawing, substituting, and holding pooled securities, and
regulations prescribing the form, content, and execution of any application, report, or other document
called for in any of the sections specified in subdivision (a) or in any regulation or order issued under any
of those sections.
(2) The administrator, for good cause, may waive any provision of any regulation adopted pursuant to
paragraph (1) or arty order issued under this article, where the provision is not necessary in the public
interest.
(d) The administrator may enter into any contracts or agreements as may be necessary, including joint
underwriting agreements, to sell or liquidate eligible securities securing local agency deposits in the event
of the failure of the depository or if the depository fails to pay all or part of the deposits of a local agency.
(e) The administrator shall require from every depository a report certified by the agent of depository
listing all securities, and the market value thereof, which are securing local agency deposits together with
the total deposits then secured by the pool, to determine whether there is compliance with Section 53652.
These reports may be required whenever deemed necessary by the administrator, but shall be required
at least four times each year at the times designated by the Comptroller of the Currency for reports from
national banking associations. These reports shall be filed in the office of the administrator by the
depository within 20 business days of the date the administrator calls for the report.
(f) The administrator may have access to reports of examination made by the Comptroller of the
Currency insofar as the reports relate to national banking association trust department activities which
are subject to this article.
(g)(1) The administrator shall require the immediate substitution of an eligible security, where the
substitution is necessary for compliance with Section 63652, if (i) the administrator determines that a
security listed in Section 53651 is not qualified to secure public deposits, or (ii) a treasurer, who has
deposits secured by the securities pool, provides written notice to the administrator and the administrator
confirms that a security in the pool is not qualified to secure public deposits.
Additions or changes indicated by undedine; deletions by asterisks
165
GOVERNMENT CODE
§ 53661
(2) The failure of a depository to substitute securities, where the administrator has required the
substitution, shall be reported by the administrator pro�mdptly to as follows: Choose treasurers having money on
deposit in that depository and, in addition, shall be repo
(A) When that depository is a national bank. to the Comptroller of the Currency of the United States.
(B) When that depository is a state bank, to the Superintendent of Banks. goad.
(C) When that depository is a federal association, to the Federal Home Loan Bank
(D) When that depository is a savings association, to the Savings and Loan Commissioner.
(E) When that depository i9 a federal credit union, to the National Credit Union Administration.
(F) When that depository is a state credit union or a federally insured industrial loan company, to the
Commissioner of Corporations.
(h) The administrator may require from each treasurer a registration report and in appropriate times
report from
a report stating the amount and location of each deposit together with other information deemed
a treasurer to the administrator are conclusively presumed to be true for the single purpose of the
necessary by the administrator for effective operation of this amide. The facts recited le any se signed to him or her this article and for no other purpose.
administrator fulfilling responsibilities as
(i)(1) If, after notice and opportunity for hearing, the administrator finds that any depository or agent
of depository has violated or is violating, or that there is reasonable cause to believe that any depository
or agent of depository is about to `isolate. any of he sections specified in subdivision (a) or any regulation
or order issued under any of those sections, the adaunutrator may oder the depository or agent oof
f
depository to cease and desist from the violation or may by order suspend or revoke the authorization ve
the agent of depository. The order may require the depository or agent of depository to take affirmative
action to correct any condition resulting from the violation. h (1) with respect to any
(2)(A) If the administrator makes any of the findings set forth in paragrap
depository or agent of depository and, in addition, finds that the violation or the continuatorder the
ion of the
violation is likely to seriously prejudice the interests desist
of treasurers. the tion r maysuspend or revoke the
depository or agent of depository to cease and desist from the the depository or gent of depository to
authorization of the agent of depository.o Theorderthe violation.
take affirmative action to correct any the depository or agent
file with the administrator an application for a hearing on the oder. The administra-
(B) Within five business days after an order is issued under subparagraph ( ),
of depository may after receipt of an application for
tor shall schedule a hearing at least 30 days, but not more Lydd days,
or an agent of depository.
a hearing or within a shorter or longer period of time e specified aor agreed to time Period. the order
If the administrator fails to schedule the hearingthe administrator shall affirm. modify, or
shall be deemed rescinded. Within 30 days after the hearing,ry or agent of
rescind the oder, otherwise, the order shall be deemed rescinded • The right
for ghtjuda dep evie,v the order
depository to which an oder is issued under subparagraph (A) tope
shall not be affected by the failure of the depository or agent of depository to apply to the administrator
for a hearing on the oder pursuant to this subparagraph• h (1) or (2), the
(3) Whenever the administrator issues a cease and desist order under paragraph
administrator may in the oder restrict the right of which the orde�s dwithdraw s the aBe nurities rof a secuntY
i°ry
pool; and, in that event, both the depository to
pos
which holds the security pool shall comply withthe restriction.
(4) In case the administrator issues an oder under paragraph (1) or (2) suspending or revoking the
authorization of an gent of depository, the administrator may order the agenositorytdepository tat its ma'_
expense to transfer all pooled gents of de held by it si nuchagent n the order shall accept and hold the pooled
designate in the order. The agent of depository designate
securities in accordance with this article anwhene veru appears tos and he administratrs issued under orthatany person ha=
(j) In the discretion of the administrator, person is about to violate. an.:
violated or is violating, or that there is reasonable causeon to elieve that any oder issued thereunder, the administrator
of the sections specified in subdivision (a) or any regal regulation t or oder issued thereunder.
may bring an action in the name of the people of the State of California in the superior court to enjoir. Cha
violation or to enforce compliance with those sections or any restraining oder, or writ of mandate +ha_
Upon a proper showing a Permanent or p. the to Post a bond.
be granted, and the court may not requireIty
(k) In addition to other remedies, the administrator shall have the
in power
s on (a)oafteroa bear
followingfollowing sanctions for noncompliance with the sectionsfine assessed -Pursuant to this subdivision shad 6-
requested by the party deemed in noncompliance. Any
paid within 30 days after receipt of the assessment.
Additlons or changes indicated by 1nndderline; deletions by asterisks
GOVERNMENT CODE §53665
(1) Assess against and collect from a depository a fine not to exceed two hundred fifty dollars ($250)
for each day the depository fails to maintain with the agent of depository securities as required by
Section 53652.
(2) Assess against and Collect from a depository a fine not to exceed one hundred dollars ($100) for
each day beyond the time period specified in subdivision (b) of Section 53663 the depository negligently or
willfully fails to file in the office of the administrator a written_ report required by that section.
(3) Assess against and collect from a depository a fine not to exceed one hundred dollars ($100) for
each day beyond the time period specified in subdivision (e) that a depository negligently or willfully fails
to file in the office of the administrator a written report required by that subdivision.
(4) Assess and collect from an agent of depository a fuze not to exceed one hundred dollars ($loo) for
each day the agent of depository fails to comply with any of the applicable sections specified in
subdivision (a) or any applicable regulation or order issued thereunder.
(I)(1) In the event that a depository or agent of depository fails to pay a fine assessed by the
administrator pursuant to subdivision (k) within 30 days of receipt of the assessment, the administrator
may assess and collect an additional penalty of 5 percent of the fine for each month or part thereof that
the payment is delinquent.
(2) If a depository fails to pay the fines or penalties assessed by the administrator, the administrator
may notify local agency treasurers with deposits in the depository.
(3) If an agent of depository fails to pay the fines or penalties assessed by the administrator, the
administrator may notify local agency treasurers who have authorized the agent of depository as provided
in Sections 53649 and 53656, and may by order revoke the authorization of the agent of depository as
provided in subdivision (i).
(Added by Stats.1986, c. 1132, § 29. Amended by Stats.1987, c. 841, § 4; Stats.1988, c. 1004, § 5.)
Historical and Statutory Notes
1986 Legislation
1988 Legislation
Former § 53661, amended by Stata198o, t 1288, ¢ 6
and Stats.1984, C. 659, ¢ 9, relating to the same subject
1958 amendment became operative upon adoption of
matter, was repealed by Stats.19K t 1132, ¢§ 27. 2&
ACA No. 63 (Prop. 881 at the general election Nov. 8,
198&
1987 Legislation
Derivation: Former ¢ 53661, added by Stata1969, t
The 1987 amendment inserted provisions requiring pay.
1483, P. 30.37, ¢ 17, amended by Stats.1971, a 434, p. 843,
ment of fines within 30 days, and added subd. (1), provid•
¢ 3: Stat&195Q c. 1288, p. 4370, ¢ 6; Stats.1984, c. 659,
ing penalties for late payment of fines.
¢ g,
Code of Regulations References
Order to substitute for nonqualifed security, see 2 Cal
Code of Regs. § 16008.12.
§ 53663. Determination of amounts to be deposited as inactive and active deposits
Code of Regulations References
Report of addition, withdrawal, or substitution of secur.
ties, see 2 Cal Code of Regs. § 1600522-
§
600.522
§ 53664: Individual reports; privileged status
The individual reports specified in Sections 53654, 53660, 53661, " • and 53663 are not public
documents and are not open to inspection by the public.
(Amended by Stats.1987, c. 841, § 5.)
§ 53665. Default by depository; payment by agent of depository; excess funds; drawing on letter
of credit
H a depository fails to pay all or part of the deposits of a local agency secured by pooled securities in
accordance with the contract provided for in Section 53649, and on demand of its treasurer or other
authorized official and the treasurer files a report with the administrator, or if the depository fails:
(a) In case the onoled securities rnna:w of +6— h— e,._..,.:.....r .s....a— Z -
to convertintomoney that portion of the poo- le securities ' ` ' necessary to produce an
Additions or changes Indicated by underline; deletions by asterisks • ' '
167
a
§ 53665
GOVERNMENT CODE
amount equal to the sum of (i) the deposits of the local agency* (H). any accrued interest due
-, a -r.6, seo„t. of deoository m complying with the orde
a enc of ce Boor •-_• ----- - -
in comp vinR with the order of the administrator as approved by the administrator excess
resulting from the conversion ' shall be retained by the agent of depository as part of the se
pool until the depositary substitutes for the excess moneys securities having a market value Buff
i.__...ue .,,t.l of ,mIPd securities up to the amount required by Section 53652.
(Amended by Stats.1986, c. 1132• § 30.)
Code of Regulations References
Conversion and payment instruction, see 2 Cal. Code of
Regs. § 16009.4.4.
§ 53667. Expenses of administrator, levy of assessment on depositories; payments; penalty
(a) Expenses incurred by the administrator in carrying out the duties and responsibilities assigned to
the administrator by the sections specified in subdivision (a) of Section 53661, shall be home by the Local
Agency Deposit Security Fund, which is hereby created and continuously appropriated to the administra-
tor for the administration of the sections specified in subdivision (a) of Section 53661. This fund shall
consist of fines levied pursuant to Section 53661, fes collected pursuant to the sections specified in
subdivision (a) of Section 53661• and assessments levied pursuant to this section.
(b) Each fiscal year the administrator shall levy an assessment on a pro rata basis on those
depositories which at any time during the preceding fiscal year held local agency deposits ' • '. The
total assessment levied on all of those depositories shall be in an amount which, when added to the
amount of fines and fees that the administrator estimates will be collected during the fiscal year when the
assessment is levied, is sufficient in the judgment of the administrator to meet the expenses of the
administrator in administering the sections specified in subdivision (a) of Section 53661 and to provide a
reasonable reserve for contingencies. The basis of the apportionment of the assessment among the
depositories assessed shall be the proportion that the average amount of local agency deposits held by
each of those depositories bars to the average total amount of local agency deposits held by all of those
depositories as shown by the reports of depositories to the administrator for the preceding fiscal year, as
onrequired
ea hdin of those subdivision positoris shall beano llesss than twenty-five dollarsrovided, however, that ($25amount of the assessment faired
(c) The administrator shall notify each depository by mail of the amount levied against it. The
depository shall pay the amount levied within 20 days after such notice into the Local Agency Deposit
Security Fund for the administration of the sections specified in subdivision (a) of Section 53661. If
payment is not trade to the administrator within such time, the administrator shall assess and collect, in
addition to the annual assessment, a penalty of 5 percent of the assessment for each month or part
thereof that the payment is delinquent If a depository fails to pav the asses.a eantwiih edeatoBits
wits -mssed
(Amended by Stats.1986, c. 1132. § 31; Stats.1987, C. 841. § 6.)
§ 53676. Treasurers responsibility for securities
The treasurer is not responsible for securities delivered to and receipted for by any bank, savings and
loan association, credit union, federally insured industrial loan company, or trust company.
(Amended by Stats -1984, c. 659, § 10; Stats -1988, c. 1004, § 6.)
Historical and Statutory Notes
1988 tegislation
Operation of 1988 amendment, see Historical and Statu-
tory Notes under § 51630.
Additions or changes indicated by underline; deletions by asterisks
168
PM
GOVERNMENT CODE § 53682
4 53679.- Money under control or coming into possession of officers and employees other than
treasurer
So far as possible all money belonging to a local agency under the control of any of its officers or
employees other than the treasurer or a judge or officer of a justice or municipal court shall, and all
money coming into the possession of a judge or officer of a justice or municipal court may, be deposited
as active deposits in the state or national bank, inactive deposits in the state or national bank or state or
federal association, • * • federal or state credit union or federally insured industrial loan company in
this state selected by the officer, employee, or judge of the court. For purposes of this section, an officer
or employee of a local agency and a judge or officer of a justice or municipal court are prohibited from
depositing local agency funds or money coming into their possession into a state or federal credit union if
an officer or employee of the local agency, or a judge or officer of a justice or municipal court, also serves
on the board of directors, or any committee appointed by the board of directors, or the credit committee
or supervisory committee, of the particular state or federal credit union. Such money is subject to this
article except:
(a) Deposits in an amount less than that insured pursuant to federal law are not subject to this article.
For deposits in excess of the amount insured under any federal law a contract in accordance with
Section 53649 is required and the provisions of this article shall apply.
(b) Interest is not required on money deposited in an active deposit by a judge or officer of a justice or
municipal court.
(c) Interest is not required on money deposited in an active deposit by an officer having control of a
revolving fund created pursuant to Chapter 2 (commencing with Section 29300) of Division 3 of Title 3.
(d) Interest is not required on money deposited in an active deposit by an officer having control of a
special fund established pursuant to Articles 5 (commencing with Section 29400) or 6 (commencing with
Section 29430) of Chapter 2 of Division 3 of Title 3.
(Amended by Stats.1984, c. 659, § 11; Stats.1985, c. 983, § 25, eff. Sept. 26, 1985; Stats.1988, c. 1004,
§ 7.)
Historical and Statutory Notes
1988 Legislation
Operation of IM amendment. see Historical and Statu-
tory Notes under § 53630.
§ 53679.1. Accounting practices; declaration of existing law
Notwithstanding any other provision of law, the accounting practices of each county utilized prior to the
effective date of this section relating to interest on trust funds shall be deemed appropriate and to have
been made under the direction of the board of supervisors of that county. This section is declaratory of
the law in existence prior to the enactment of this section.
(Added by Stats -1992, c. 1032 (S.B.1926), § 1.)
§ 53682. Contracts for services by depository; requirements
Notwithstanding any other provision in this article except Section 5365$ the treasurer may deposit
moneys in and enter into contracts with any depository, as defined in subdivision (e) of Section 53630, for
services to be rendered by that depository that in the treasurer's judgment are to the public advantage.
One copy of each • • • contract entered into under this section shall be filed with the auditor or
corresponding officer of the loco( agency. The contract shall:
(a) Fix the duration of compensating deposits, if any.
(b) Fix the interest rate of that compensating deposit, if any,
(c) Specify the services to be rendered by the depository,
(d) Indicate whether the depository shall bear the expenses of transportation of the money to and from
the depository_
(e) Fix the consideration payable by the agency for such services.
111 ty who may deposit moneys into the treasurer s active account and how those persons are to
make those deposits.
(Amended by Stats -1994, e. 705 (S.B.1804), § 11.)
Additions or changes Indicated by underline; deletions by asterisks
169
GOVERNMENT CODE
§ 53684
5 536&. Local agencies; excess funds; investment by county treasurer
(a) Unless otherwise provided by law, if the treasurer of any local agency, or other official responsible
for the funds h the local agency, determines that the local agency has excess funds which are not
required for immediate cal the treasurer or other official may, upon the adoption of a resolution by the
legislative or governing body of the local agency authorizing the investment of funds pursuant to this
steheUon�anse it t corsetment by the contyytreasurertreasurer,
pursuant othe
Section 53601 ora funds in t5363 he ty treasury for
P rtion an interest or other increment derived from the
(es The county s curer shall, quarterly, in a Y
investment of funds pursuant o this sectionandandistiict. amount Proportionate o the average daily balance o
the amounts deposited by the local agency rer may deduct the actual costs
prior o distributing that interest or increment. the counthe average daily balance of the
incurred by the county in administering this section in Proportion
amounts deposited by the local agency. pursuant o subdivision (b) of
(c) In Conjunction with the monthly report required o be prepared sheto the
Section 5346 the county treasurer shall
o6r other official responsible for therfunds of any local agencyswhich hu e information funds oin that n depos t in he
county treasury and that information shall, except as otherwise provided in paragraph (41 of subdivision
(b) of Section 53646, be included by the treasurer or other official in a monthly report to the legislative or
governing body of the local agency. cy may withdraw the funds
(d) The treasurer or other official resPOW alethe county treasurer 30 days the funds of the local written written notice of his,or her
of the local agency at any time but shall gi
intent to withdraw the funds. this ion are not
(e) Any moneys deposited in he county foul investment
or agency whilevhe ant funds are deposited.
subject o countyimpoundment or seizure by any o
ffic(f) This section is not operative secounty ct on operative to ut heed of s pe�ors of the county, by majority
vote, adopts a resolution ma)dng
(g) It is the intent of the Legislature in enacting his section o provide an alternative procedure to
Section 51301 for local agencies o deposit money in the county treasury for investment purposes.
N
o coin this secon oa ntract fortithes county treasurere, beto perform construedas treasury functions tiforaatcitytpurs antof a uo Section
51301.
(Added by Stats.1986, C. 582, $ 1, eff. Aug. 26, 1986.)
Article 2.5
SALE OF SECURITIES
§ 53692. Notice of intention to sell securities; publication; contents
In addition o any other requirement
imposed ($1,0M 000) at alp public sale, east 15 n issuer hall purior to the soleblish noof sov tice public
securities which exceed one million dollars ($1,throughout
the intention o sell the securitieseinated among pros c tion cU've bidders for thea securities. The tnoti ea shall'
__-- _ .. _,,,,.,. of rhe securities to be ----
(Amended by Stats -1988, m 984. 11 3.)
Historical and Statutory Notes
tive bidders for the securives" following "the State": end
1988 Legislation
The 1988 amendment inserted in the Cyst sentence "or made nonsubstantive changes.
reasonably expected to be disseminated among prospeC-
Article 3.6
PUBLIC LIBRARY SPECIAL TAXES
Section special taxes im-
5a7l7. , facilities and services; 53717.4. Application un a article: p
53717, Public library posed under Chapter 2.5.
special taxes: definition.
53717.2. Special tax; basis for apportionment. _
Additions or changes Indicated by underline; deletions by asterisks '' e
170
EXHIBIT B
CITY OF SANTA CLARITA
23920 VALENCIA BLVD., SUITE 300
SANTA CLARITA, CA 91355
REQUEST FOR PROPOSAL FOR BANKING SERVICES
FA11 \ 1 05
The following request by the City of Santa Clarita is hereby incorporated and made part of the
Request for Proposal for Banking Services originally due February 28, 1997. The deadline for
submitting the Proposal, including the information requested in this addendum, is. hereby
extended to 12:00 noon, March 7, 1997 and may be submitted to:
CITY OF SANTA CLARITA
GENERAL SERVICES DIVISION
BANKING SERVICES RFP
23920 VALENCIA BLVD., SUITE 294
SANTA CLARITA, CA 91355
ATTN: JON BISCHETSRIEDER
INFORMATION REQUESTED:
In two pages or less, describe the financial institution's Community Reinvestment Act program
established in the Santa Clarita area and summarize the disclosure data for the last three years for
the City of Santa Clarita.
City of Santa Clarita.. RFP for Banking Services Addendum
EXHIBIT C
23920 Valencia Blvd.
Suite 300
Santa Clarita
California 91355-2196
City of
Santa Clarita
February 3, 1997
To: RFP Recipients
Phone
(805)259-2489
Fax
(805)259-8125
Re: Questions on the City of Santa Clarita's Banking and Safekeeping RFP's
The following are questions the City of Santa Clarita has received to date regarding the
Banking Services and Investment Safekeeping RFP. It is the policy of the City to respond
in writing to these questions and to send the questions and answers to all RFP recipients.
Q. We [the candidate] offer to submit a custom pricing worksheet along with a
brochure of products and services that we believe will cover all aspects of your
[the City's] request as opposed to submitting a customized response in the format
of the RFP. Will this format be acceptable to the City?
A. This format will be acceptable. However, please note, that if this format deviates
from the City's format in such a way as to omit information that the City is
requesting, it could result in an unsatisfactory rating.
Q. How often does the City bid out for their business and investing services?
A. Usually every three years the City will go out to bid for banking services.
Q. How many institutions are interested in bidding for the City's services?
A. As of February 3, 1997, nineteen institutions have received RFP bid packages.
Q. What institution is currently managing the City's banking and investment needs?
A. The City's operating accounts are currently held with TransWorld Bank. Bank of
America is currently the City's safekeeping bank for investments.
PRINTED ON RECYCLED PAPER
Page 2
RFP Recipients
If you should have any more questions, please refer to page 3 of the RFP under "Proposal
Terms and Conditions" for specific instructions on how the City accommodates
questions._ And thank you for your interest in the City of Santa Clarita.
Sincerely,
449
April Jordan, Accountant
cc: Barbara Boswell, Acting Accounting Manager 1, gb
s:Tfin\apri ixfp\quesdon.wpd
EXHIBIT D
23920 Valencia Blvd.
Suite 300
Santa Clanta
California 91355-2196
City of
Santa Clarita
February 19, 1997
To: RFP Recipients
Phone
(805) 259-2489
Fax
(805)259-8125
Re: Questions on the City of Santa Clarita's Banking and Safekeeping RFP's
The following are questions the City of Santa Clarita has received.from February 3, 1997
to date regarding the Banking Services and Investment Safekeeping RFP. It is the policy
of the City to respond in writing to these questions and to send the questions and answers
to all RFP recipients.
Ql. On page 7, item C-3 please explain in detail what services you expect from the
bank.
Al. This item, which reads "Bank will process Letter of Credit payment request, by
wire service, from the U.S. Treasury and guarantee immediate credit'for such
deposits" is hereby eliminated from the RFP and does not require a response.
The following questions are in regards to Page 6, Item A, MasterCardNisa Deposits,
Question 10 of the RFP:
Q2. Does the City currently have equipment for Merchant card transactions? If so,
what kind?
A2. Yes. The manufacturer is Modular Data Inc.
Q3. Does the City transmit data electronically?
A3. Yes. The credit card information is transmitted electronically.
Q4. What is the average ticket dollar amount?
PRINTED ON RECYCLED PAPER
Page 2
February 19, 1997
Re: Questions on the City of Santa Clarita's Banking Services RFP
A4. The average dollar amount of a single credit card transaction is approximately
$57.87.
Q5. Does the City maintain any offsite locations where it accepts credit cards?
A5. The City puts on an event once a year whereby the credit card transmittal
equipment is temporarily modified to be used offsite.
The following question is in regards to Page 7, Item C, Automatic Payroll, Question
2 of the RFP:
Q6. Does the City use a payroll vendor or is payroll processed in-house?
A6. Payroll is processed in-house.
The following question is in regards to Page 7, Item.C, Direct Deposits, Question 3
of the RFP:
Q7. What is the City referring to when is speaks of "Letter of Credit" payments?
A7. Please refer to Al.
Additional questions:
Q8. Are any of the City of Santa Clarita's assets considered Public Funds?
A8. The majority of the deposits are considered public funds.
Page 3
February 19, 1997
Re: Questions on the City of Santa Clarita's Banking Services RFP
Q9. What is the estimated monthly volume for merchant activity?
A9. The monthly average credit card activity is approximately 500 transactions.
Q10. What is the average ticket size for a merchant transaction?
A10. Refer to A4.
Qll. What is the average ledger balance maintained in the concentration account?
All. The monthly average ledger balance maintained in the concentration account is
$450,000. However, the daily balance can range from $0 to several million
dollars.
Q12. What is the average monthly float?
Al2. The monthly average float in the concentration account is approximately
$100,000.
Q13. Will the City maintain balances to compensate/offset service fees?
A13. This is subject to negotiation.
Q14. Does the City own existing merchant equipment or lease? What type of
equipment is used and how many locations?
A14. Refer to A2 and A5. This equipment is owned by the City.
Page 4
February 19, 1997
Re: Questions on the City of Santa Clarita's Banking Services RFP
Q15. How will the City provide direct deposit input to the bank?
A15. Currently the City provides direct deposit data to the bank by modem. However,
the City may opt to use a different method depending on what is most
advantageous to the City.
Q16. How often is payroll input sent to the bank? (i.e., weekly, by -weekly, semi-
monthly, monthly)
A16. Bi -weekly.
Q17. What is the monthly dollar amount of currency deposited? Is the currency sorted
and strapped?
A17. The monthly average amount of currency deposited is approximately $13,000.
During the month of March the City may take in as much as $30,000 in currency
due to the Cowboy Poetry event. The currency is not sorted or strapped.
Q18. What is the monthly dollar amount of coin deposited? Is the coin rolled or loose
in canvas bags? How many rolls or bags?
A18. The monthly average dollar amount of coin deposited is approximately $400. The
coins are placed loose in canvas bags. One bag is used for each kind of coins (i.e.
one bag for pennies, one bag for nickels, etc.)
Q19. Does the City purchase monthly coin and currency and if so, how much?
A19. Occasionally, the City will request change for a twenty dollar bill.
Page 5
February 19, 1997
Re: Questions on the City of Santa Clarita's Banking Services RFP
Q20. Does the City require the bank to report through balance reporting all checks paid
on the payroll and regular accounts?
A20. Yes.
Q21. Does the City require account reconciliation for checks paid on both the regular
and payroll accounts?
A21. The City does its own account reconciliation.
If you should have any more questions, please refer to page 3 of the RFP under "Proposal
Terms and Conditions" for specific instructions on how the City accommodates
questions. And thank you for your interest in the City of Santa Clarita.
Sincerely,
April Jordan, countant
cc: Barbara Boswell, Acting Accounting Manager b 6
s:Tfinlapri1\rfpTquest2.wpd
EXHIBIT E
City of
Santa Clarita
23920 Valencia Blvd.
Phone
Suite 300
(805) 259-2489
Santa Cladta
Fax
California 91355-2196
(805) 259-8125
March 19, 1997
Cathy Culotta
Vice President
Valencia National Bank
23620 Lyons Avenue
Santa Clarita, CA 91321
Dear Ms. Culotta:
We have reviewed your proposal in response to the City of Santa Clarita's
Request For Proposal for Banking Services and are in need of clarification with
regards to Section I INTRODUCTION, page 1 of the RFP. This Section reads:
The City of Santa Clarita is requesting proposals for
full-service banking services from financial
institutions that meet the requirements set forth in
the Financial Code Section 5102 and the applicable
Government Code Sections 53637 through 53692
attached...
The City is seeking clarification on Valencia National Bank's ability to comply
with Government Code Section identified above. Although it is inferred in the
RFP that if a financial institution responds to the RFP, it meets these
requirements, the proposal did not make it clear that Valencia National Bank does
in fact comply with these Government Code Sections. Due to the obvious
importance of this matter, the City would like to be assured that Valencia National
Bank does comply with all applicable California Government Code Sections listed
in the above paragraph and in particular, Sections 53652 and 53656 which discuss
the collateral requirements of the depository to secure the deposits of a local
agency.
PRINTED ON RECYCLED PAPER
City of
Santa Clarita
23920 Valencia Blvd.
Phone
Suite 300
(805) 259-2489
Santa Clarita
Fax
Califomia 91355-2196
(805) 259-8125
Page 2
Cathy Culotta, Vice President
Valencia National Bank
Please clarify. Valencia National Bank's ability or inability to comply with the
California Government Code Sections referred to in the City of Santa Clarita's
Request For Proposal for Banking Services Section I, page 1, via fax by 12:00
noon, Thursday, March 20, 1997. Our fax number is (805) 259-8125 and should
be addressed to April Jordan.
Thank you in advance for your timely response.
Sincerely,
April Jordan, Accountant
cc: Steve Stark
Barbara Boswell
Jesse Juarros
s,.Vm\apnl4fp\vnbltr.wpd
PRINTED ON RECYCLED PAPER
EXHIBIT F
March 20, 1997
Ms. Cathy Culotta
Vice President
Valencia National Bank
23620 Lyons Avenue
Santa Clarita, CA 91321
Subject: City of Santa Claiita RFP for Banking Services
Dear Ms. Culotta:
We have received your proposal in response to the City of Santa Clarita's
Request for Proposal for Banking Services. As a second part of the bidding
process, , and as an amendment to the original RFP with the deadline for
submission of February 28, 1997, the City is requesting additional information.
The deadline to respond to this request for additional information is Friday,
March 28, at 4:00 p.m. The responses should be delivered to: April Jordan,
City of Santa Clarita, 23920 Valencia Boulevard, Suite 304, Santa Clarita, CA .
91355 or faxed to April Jordan at fax number (805) 259-8125.
Additional information requested is as follows:
1. Please provide.a copy of your standard "Contract for Deposit of Moneys" as
would be utilized for a public agency.
2. Please provide the answers to the following questions:
a) What types of securities, as listed in Government Code Section 53651,
will be used as collateral to secure the City's deposits in accordance
with Government Code Section 53652?
b) With regards to Government Code Sections 53656 and 53657, please
specify exactly how the bank would comply with these sections (i.e.,
where would the securities used as collateral for public agency deposits
be held? Would the institution holding these securities meet all
requirements as stated in Government Code Sections 53656 and
53657?)
c) What percentage of the City's deposits will be collateralized?
PRINTED ON RECYCLED PAPER
23920 Valencia Blvd. Phone
.
Suite 300 (805) 259-2489
Santa Clarita Fax
California 91355-2196 (805) 259.8125
City of
Santa Clarita
March 20, 1997
Ms. Cathy Culotta
Vice President
Valencia National Bank
23620 Lyons Avenue
Santa Clarita, CA 91321
Subject: City of Santa Claiita RFP for Banking Services
Dear Ms. Culotta:
We have received your proposal in response to the City of Santa Clarita's
Request for Proposal for Banking Services. As a second part of the bidding
process, , and as an amendment to the original RFP with the deadline for
submission of February 28, 1997, the City is requesting additional information.
The deadline to respond to this request for additional information is Friday,
March 28, at 4:00 p.m. The responses should be delivered to: April Jordan,
City of Santa Clarita, 23920 Valencia Boulevard, Suite 304, Santa Clarita, CA .
91355 or faxed to April Jordan at fax number (805) 259-8125.
Additional information requested is as follows:
1. Please provide.a copy of your standard "Contract for Deposit of Moneys" as
would be utilized for a public agency.
2. Please provide the answers to the following questions:
a) What types of securities, as listed in Government Code Section 53651,
will be used as collateral to secure the City's deposits in accordance
with Government Code Section 53652?
b) With regards to Government Code Sections 53656 and 53657, please
specify exactly how the bank would comply with these sections (i.e.,
where would the securities used as collateral for public agency deposits
be held? Would the institution holding these securities meet all
requirements as stated in Government Code Sections 53656 and
53657?)
c) What percentage of the City's deposits will be collateralized?
PRINTED ON RECYCLED PAPER
March 20, 1997
Page 2
d) .How does the bank ensure that the collateral requirements are met at
all times as the City's deposits fluctuate? By what means and how
often will the City be notified that collateral requirements are being
met?
e) With regards to Government Code Section 53638, how can the City be
assured that its deposits will not exceed the bank's shareholder's equity
or net worth?
fl What evidence would the bank be able to provide (if requested) that
would demonstrate compliance with all California Financial Code
Sections and California Government Code Sections that apply to the
deposit of public funds?
Thank you in advance for your timely response.
Sincerely,
t2rf&kI_OO
Accountant
AJ:hds
fin\ april\rfp\bankrfp.pri
cc: Steve Stark, Director of Administrative Services
Barbara Boswell, Acting Accounting Manager
EXHIBIT G
IWVALENCIA
NAI'IONAL BANK
INTRODUCTION
Valencia National Bank would like to thank the City of Santa Clarita
for giving us the opportunity to review the City's banking requirements and
to submit this proposal.
This proposal has been prepared exclusively for the confidential
use of the City of Santa Clarita and is submitted based upon the understanding
that it will not be utilized by or disclosed to other banking institutions. It
is intended for the confidential use of Steve Stark and other people
responsible for evaluating the proposal.
We are celebrating our ten year birthday this year as the only
"community bank" in the Santa Clarity Valley. We were formed as the
result of a need by the local business community to have a. bank that would
be responsive to their needs. Because the bank has been successful in our
community, we have helped businesses, individuals and non-profit organizations
benefit and grow. Valencia National Bank returns to the community, in time
and cash contributions to charitable, civic and service organizations over twenty
times the amount Wells Fargo Bank and Bank of America do, yet they are
three times our size in this valley. This effort has helped the City of Santa Clarita
become a strong growing community to live in.
. Valencia National Bank seeks to establish mutually beneficial long
term relationships with our customers. We recognize how competitive our
industry is and pricing is no longer an issue, because all banks price
competively. Therefore the issue is service. Our retention rate for customers is
remarkably high, a customer becomes part of our family. Each customer is
assigned a minimum of 3 bank representatives to handle our account
relationship. They are: the account assigned officer, the Branch Service
Manager and the Director of Branch Services. As a community bank, John
Reardon, President and CEO is only a phone call away and many times will end
up in our customers offices to learn more about your business and what VNB
can do to service you better. All decision makers not only work in the Santa
Clarita Valley, we all live and raise our families in the Santa Clarita Valley. Our
customers are not numbers, they are individuals and neighbors. This proposal
is the first step in establishing such a relationship. We feel this proposal
appropriately responds to the banking needs of the City of Santa Clarita, as
presented to. us.
23620 Lyons Avenue, Santa Clarita, Californla 91321 / (805) 254-9900 Fax: (805) 254-9904
VII. REQUIRED SERVICES
A.
OPERATING ACCOUNT - Volume and nature of
Unit
Monthly
transactions -
Charge
Charge
1.
The City averages approximately 65
$ 1.40
$ 91.00
separate deposits a month.
2.
Average number of checks depositedJ`-_
$ .10
\ $55.00
•
monthl 550
Y•
3.
The average number of checks to clear
$ .14
$147.00
the bank per month is 1,050.
4.
Returned checks average 18 per month.
$ 5.00
$ 90.00
5.
Stop payments average 4 per month.
$15.00
$ 60.00
6. Bank must provide daily balance reporting NIC for Telebank
service that the City can obtain by 8:00 a.m. each Services
day for ledger, collected, and available balances,
and total debit and credit information, for the
previous day's activity.
7. Bank must be able to provide in and out wire See Below See Below
services for transfer of funds to and from other
financial institutions and brokerage firms within
the United States for various purposes. Such
transfers -will be "same day."
Please state the time of day of the wire
deadline: 1:00 P.M.
Average number of outgoing wires, initiated by $ 30.00 $150.00
the City, per month: 5
Average number of incoming wires, initiated by $ 10.00 $ 50.00
the City, per month: 5
8. Bank will receive and guarantee immediate NIC NIC
credit on all incoming wire transfers. *received by 1:00 p.m.
9. All debit and credit confirmations must be
received by the City within three days following
the date transactions occur.
10. Bank must accept MasterCard/Visa deposits.
Average number of credit card transactions
per month: 500
COMMENTS:
Not Applicable
Discount Mo. Minimum
Rate Discount Charge
2.71% $15.00/month
k -33,(D if card not used
The City of Santa Clarita Parks & Recreation Department as well as Finance Department have
been customers of the Valencia National Bank merchant card program since 1990 The $15.00
monthly minimum charge only takes place if there are no transactions for the month To date
this charge has not occurred.
Inclusive Monthly Charges for General Account
• Transactions Based on Volume as Described Above=
$643.00
Monthly
B. ZERO BALANCE ACCOUNTS (ZBA) Charge Charge
The City may desire to maintain separate Zero $ 25.00 $ 50.00
Balance Accounts tied directly to the operating
account. These are unfunded disbursement
accounts. The "overdraft" created is covered
by daily transfers of funds from the operating
account as checks clear against the ZBA.
COMMENTS:
$25.00 monthly flat fee per account; two accounts apply payroll and accounts payable
Inclusive Monthly Charge for ZBA Accounts on
Above Volumes i' $ 50.00
C. DIRECT DEPOSITS
1. The Bank will accept direct deposits to the $ .10 $ .40
City's account from the State of California
(almost entirely from the State Treasurer's
Office, State Controller's Office, and the U.S.
Treasury) and guarantee Immediate credit for
such deposits.
Average number per month: 4
Unit Monthly
Charge Charge
2. The Bank will accept Automatic Payroll $ .05 $ 10.00
Deposits on behalf of the employees of Plus $25.00 per payroll
Santa Clarita. transmission
Number of employees with direct deposit
is approximately 200.
Please list the available options for
transmitting payroll data to your bank.
(Modem is preferred).
Modem
MicroLink 2000
The City currently employs approximately
200 people.
3. Bank will provide "same day" notification Not Applicable
to the City on all direct deposits.
COMMENTS:
Inclusive Monthly Charge for Direct Deposits
Based on the Volume Described Above: $10.40
D.
E.
F.
BANK STATEMENTS AND RECONCIIJATION
SERVICES
The City requires monthly Account Statements
for the Operating Account and two Zero Balance
Accounts. Account Statements must include
Advices for Debits, Credits, Adjustments, and
Cancelled Checks and be submitted by the 5th
working day of the following month.
2. The City requires that all debit and credit
confirmation slips are received within three
days following the date when the transactions
occur.
ARMORED CAR SERVICE
The bank will provide armored car service three
days per week for funds in transit from Santa
Clarita City Hall to the bank at a time which will
ensure deposit on the same day as pickup.
ACCOUNT ANALYSIS STATEMENT
The Bank will supply a monthly account
analysis statement within five working days
after the close of each calendar month. Please
submit a copy of your Account Analysis
Statement.
COMMENTS:
Unit Monthly
Charge Charge
Not Applicable
NIC
$ 25.00
$120.00
NIC
G. FORMS
The Bank will furnish all necessary forms,
including but not limited to deposit slips,
stop payment forms, deposit bags (including
tags and fasteners), coin wrappers, etc.
excluding checks.
H. COIN COUNTER
The Bank will furnish a coin counter to
the City to be kept on City's facilities.
I. COMMUNICATIONS
The Bank must designate a specific officer and
an alternative to act as City liaison representative.
J. DAILY BALANCE REPORTING
The. Bank will provide daily balance reporting
services by computer access so that the City can
obtain by 8:00 a.m. each day data on ledger,
collected and available balances and itemized
debit and credit information and cancelled checks
relating to the previous day's activity.
COMMENTS:
the
Unit Monthly
Charge Charge
Not Applicable
$125.00
Valencia Branch Service
Manager, Director of Branch
Services
Unit Monthly
Charge . Charge
$ .11 $ 7.20
per transaction
This state of the art service provides increased control and flexibility for managing the City of
Santa Clarita's business- accounts. MicroLink provides a detailed review of various balance
values such as ledger, collected available and transaction totals Additionally, MicroLink will
generate an easy -to -read report of your balances and transactions in a format similar to vour bank
checking statement covering the time period you request. It willallow the Citv of Santa Clahta
to move money between any and all accounts maintained with Valencia National Bank as well as
monitor and control balances.
Annual
K. VISA CREDIT CARDS APR _ Fee
The City of Santa Clarita has established 17.5% .$25.00
two (2) credit cards for business use, with a
total credit line of $2,500.
COMMENTS:
a
uuuzmg creau caro services. The annual fee is per account therefore if using a second card
an account already created there will be no additional charge
L. COMPUTER DATA OUTPUT
The City of Santa Clarity would like the ability
to download account information into its
financial system in order to complete such
automated functions such as check reconciliations.
If the bank desires to offer this service, a supplement
attachment should be prepared and included with
the proposal describing the service in detail. The
various options available for downloading (i.e. modem,
CD, floppy disk, etc.) should be indicated as well as
the cost, if any, for this service.
NIC N/C
�I�� VALENCIA
NATIONAL BANK
L. COMPUTER DATA OUTPUT - Microlink 2000 (see data sheets
and pricing attached)
Microlink 2000 is a personal computer product. The process is
that the City of Santa Clarita will designate a p.c. or LAN to daily
dial into our assigned processor and will have your designated
account information down -loaded into your p.c. From this point
the following information is available to you:
* Previous day reporting of balance and transaction activity
* Details on individual debit and credit transactions
` A listing of all checks tht have cleared the bank during
the past ten days for specified amounts
* An analysis of float for individual checks
* Notification of your daily check disbursement information
in summary and detail
* A consolidated report of activity for all your accounts
worldwide for any period of time that you specify.
Once the data has been loaded into your p.c. or network there
are tools available as part of the product to export the information
into other utility programs like Lotus 123, WordPerfect and many
others. There is also a function to allow an "accounting connection"
to your desired in-house software. This feature allows you to
export the data in the format that your software would require to
import.
23620 Lyons Avenue, Santa Clarita, California 91321 1 (805) 254-9900 Fax: (805) 254-9904
%�VALENCIA
NATIONAL BANK
MICROLINK 2000
FEE SCHEDULE
ONE-TIME FEES:
Bank Account Reporting $ 300.00
Automated Payments and Collections (ACH) $ 250.00
MONTHLY MAINTENANCE FEES:
Base Cash Management $ 21.00
includes: Internal Transfers
Spreadsheet Interface
Connection to Lotus
Daily Worksheet
with Check Manager add 16.00
with Multibank Data Exchange add 10.00
with Stop Payment add 3.00
with Wire Transfers add 9.00
with Automated Payments and Collections add 28.00
MONTHLY ACTIVITY FEES (Tiering is incremental):
Bank Account Reporting Account Fees:
1 - 5 Accounts each account $7.20
6 - 10 Accounts each account 6.90
11-20 Accounts each account 6.60
Bank Account Reportina Transaction Fees:
1 - 300 Transactions each transaction $ .11
301 -600 each transaction $ .10
601 -1000 each transaction $ .09
1001 + each transaction $ .08
23620 Lyons Avenue, Santa Clarita, Californla 91321 / (805) 254-9900 Fax: (805).254-9904
page 2
Automated Payments and Collections:
With Bank Account Reporting monthly $ 17.00
Without Bank Account Reporting monthly 45.50
With Addenda monthly 9.00
Transaction fees (tiering is incremental)
1 -100 = $ .20
101-200 = .19
201 -500 = .18
500+ _ .16
Internal Transfers:
each internal transfer transaction $ 1.00
Multibank Data Exchange:
Account Fees each account $ 10.50
Transaction Fees each transaction .20
Any Descriptive Text per line .13 .
Stop Payments:
With Bank Account Reporting monthly $ 3.00
Without Bank Account Reporting monthly $ 26.00
each stop payment transaction: $ .80
Wire Transfers:
With Bank Account Reporting monthly $ 8.00
Without Bank Account Reporting monthly $ 26.00
each wire transfer transaction: $ 1.75
ADDITIONAL SERVICES:
Add / Delete Services (each)
$ 2.00
Add / Delete Accounts (each)
2.00
Add / Delete.Users (each)
2.00
SUMMARY OF REQUIRED SERVICES:
AND/OR
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED $ 1,700.00** $ 450,000.00
(collected)***
Subject to market fluctuations due to changes
in the 90 day T Bill rate.
COMMENTS:
* These charges could change and / or significantly be reduced by using the Microlink 2000
product.
** Average Monthly Charges per TransWorid Bank statements
*** Average Monthly Balance per TransWorld Bank statements
AVERAGE MONTHLY
SERVICE
MONTHLY FEE
BALANCE REQUIRED
A.
OPERATING ACCOUNT
$ 643.00*
$163,340.00
B.
ZERO BALANCE ACCOUNTS
$ 50.00*
12,701.00
C.
DIRECT DEPOSITS
$ 10.00*
2,642.00
D.
BANK STATEMENTS AND
$ 25.00*
6,350.00
RECONCILIATION SERVICES
E.
ARMORED CAR SERVICES
$ 120.00
'30,483.00
F.
ACCOUNT ANALYSIS
STATEMENT
$ 0
0
G.
COIN COUNTER
$ 125.00
31,753.00
J.
DAILY BALANCE REPORTING
$ 7.20*
1,829.00
K.
VISA CREDIT CARDS
$ 2.00
508.00
L.
COMPUTER DATA OUTPUT
see attached
TOTAL MONTHLY FEE
$ 982.60
$ 249,606.00
AND/OR
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED $ 1,700.00** $ 450,000.00
(collected)***
Subject to market fluctuations due to changes
in the 90 day T Bill rate.
COMMENTS:
* These charges could change and / or significantly be reduced by using the Microlink 2000
product.
** Average Monthly Charges per TransWorid Bank statements
*** Average Monthly Balance per TransWorld Bank statements
VIII. OPTIONAL SERVICES
A. SAFE DEPOSIT BOX
The Bank may provide one (1) safe deposit box
for the City. The box should be large,
approximately 10" X 11" X 21" in dimension.
COMMENTS:
Largest safe deposit box size is 9" x 10"
B. MESSENGER SERVICE
Unit Monthly
Charge Charge
$ 8.35
The Bank may provide on-call messenger $ 10.00 $ 10.00
service between City Hall and the bank.
COMMENTS:
Charge is $10.00 per call. With the close proximity of our branch to City Hallresponse time
will be excellent.
C. LOW INTEREST EMPLOYEE LOANS APR Loan Limit
The Bank may provide low-interest loans to * $30,000
employees for City -sponsored purchasing
programs.
*We will price. our loans to City employees at 50 basis points below our stated pricing,
except for home loans.
unit Monthly
D. SAFEKEEPING OF INVESTMENT'S Charge Charge
1. Under the rules and regulations of Government No Proposal
Code Section 53608, the Bank may provide third
party custodial services for all securities that the
City purchases from any source. All securities
must be received and delivered using standard
delivery versus payment (DVP) procedures which
ensures that securities are deposited with the
custodian bank prior to the release of funds.
The average number of securities purchased
per month is: 2 to 3
The average number of maturities per month
is: 2 to 3
The average size of the City's investment
portfolio is $30,000,000. Of this amount
approximately 50% is invested in LAIF and
is not subject to safekeeping.
2. The Bank shall provide monthly statements Not Applicable
listing the securities inventory held in safe-
keeping and shall provide a receipt for
securities deposited and -interest payments and
a credit advice for securities sold or matured.
3. Will Bank provide assured same-day credit
of the City's account at each investment
maturity date in the amount of all principal
and interest due, or will it credit only upon
receipt of that amount from the institution
which delivers the funds?
(Note: The City presently receives the assured
same-day credit so that it inevitably may invest
matured funds on the maturity date. Lack of
investment capability would be considered a
serious deprivation.) Indicate any charges related
to providing inevitable availablility of funds in
these circumstances.
No Proposal
SUMMARY OF OPTIONAL SERVICES:
SERVICE
MONTHLY FEE
A. SAFE DEPOSIT BOX
$
8.50
B. MESSENGER SERVICE
$
10.00 per call
C. SAFEKEEPING OF
No proposal
INVESTMENTS
TOTAL MONTHLY FEE
$
18.50
AVERAGE MONTHLY
COMPENSATING BALANCE
REQUIRED
$
37.00
COMMENTS:
AVERAGE MONTHLY
BALANCE REQUIRED
$ 2,160.00
2,540.00
$ 4,700.00
$ 9,400.00
IX. ADDITIONAL SERVICES
A. MISCELLANEOUS SERVICES
Use this item to elaborate on services your bank will offer the City which are not covered
in the previous sections.
t
B. INDIVIDUAL EMPLOYEE ACCOUNTS
Please describe briefly any plans you offer which would be beneficial to individual
accounts of employees of the City. Please include reference to free checking accounts for
employees of the City of Santa Clarita.
1st order of checks - FREE
__ 6 months FREE Safe Deposit Box
(City of Santa Clanta employees are currently receiving FREE checking and have been
SUMMARY OF ADDITIONAL SERVICES:
SERVICE MONTHLY FEE
A. MISCELLANEOUS SERVICES
B. INDIVIDUAL EMPLOYEE_
ACCOUNTS
TOTAL MONTHLY FEE $ 0
AVERAGE MONTHLY
COMPENSATING BALANCE $ 0
REQUIRED
AVERAGE MONTHLY
BALANCE REQUIRED
COMMENTS:
* See Microlink 2000 product line and pricing for additional services
X. PRICING OF BArIIGNG SERVICES
A. PAYMENT OPTION 1- DIRECT FEES
1. Will bank credit, against fees, the interest on average collected balance (monthly
or other periods)? The rate should be tied to some well-defined market rate as the
90 -day Treasury Bill rate, prime rate, etc. Please specify and submit formula.
YES - MONTHLY; TIED TO 90 -DAY TREASURY BILL RATE
FORMULA: FEE / # OF DAYS IN MONTH x 365 = ANNUAL FEE
ANNUAL FEE / EARNINGS CREDIT RATE = REQUIRED NET
INVESTABLE BALANCE
NET INVESTABLE BALANCE /.90 = COLLECTED BALANCE
REQUIRED
2. As an alternative, would the bank provide for automatic overnight deposits of
collected balance in an interest-bearing account, or could the entire general
account be placed in an interest-bearing account? Again, the rate should be tied to
some well-defined market index. Please specify and submit formula.
NO PROPOSAL
3. For how long a period beyond the first year would the bank guarantee the fixed
charges quoted? On what basis .(index or market) would these fixed fees be
modified:
12 MONTHS BEYOND THE FIRST YEAR = 2 YEARS TOTAL
4. When would payment be due for the fees? Monthly, quarterly, or yearly, and
date after the end of period.
MONTHLY FOR ACCOUNT ANALYSIS
IF PAYMENT FEES EXCEED ACCOUNT BALANCES - QUARTERLY
B. PAYMENT OPTION 2 - COMPENSATING BALANCES
1. How will the bank stipulate the required compensating balance? On what rate
index will this be determined? PLEASE SUBMIT FORMULA. Will the
compensating balances be based on ledger or collected balances? Will the excess
or deficit earnings be carried forward to future months or backward to prior
months? Please attach formula for computing balance requirement.
ACCOUNT ANALYSIS STATEMENT
90 -DAY TREASURY BILL RATE
FORMULA: FEE / # OF DAYS IN MONTH x 365 = ANNUAL FEE
ANNUAL FEE / EARNINGS CREDIT RATE = REQUIRED NET
INVESTABLE BALANCE
NET INVESTABLE BALANCE /.90 = COLLECTED BALANCE
REQUIRED
COLLECTED BALANCES
NO - MONTHLY SETTLEMENT
2. For what period of time would the Bank agree to a fixed amount for compensating
balance, regardless of the volume of transactions? How much notice prior to
effective date of any change in compensating balance will the Bank provide?
1 YEAR - 30 DAY NOTICE
In the event that the City's actual collected balances exceed the amount stipulated,
would the Bank agree to pay interest on the excess? If so, please explain, stating
period of calculation. Please submit formula.
NO PROPOSAL
4. If the answer to the previous question is negative, would the Bank provide for an
overnight interest bearing account to automatically receive funds in excess of
requirements? Again, this should be determined by some well-defined index.
Please specify. (Include Money Market and Super NOW Accounts)
NO PROPOSAL
C. PAYMENT OPTIONS - GENERAL (applying to both Payment Options 1 and 2)
1. What charges would be made for "uncollected funds used" and on what rate or
index would this charge be determined?
VALENCIA NATIONAL BANK PRIME RATE + 2%
2. Please indicate the exact number of days "float time" for deposits:
1) Checks drawn of proposer's bank: 1 days
2) Checks drawn on California's banks: 1 day in area checks
2 days out of area checks
3) Checks drawn on Out of State banks: 2 or.3 days
3. During the full term of the agreement, will the bank permit switches from
Payment Option 1 to Payment Option 2 (or visa versa)? Please state at what
period of time such change will be permitted and how much advance notice is
required.
NOT APPLICABLE
4. Are all funds deposited available for immediate investment or other
disbursements? (i.e., total ledger balance)
YES - SUBIECT.TO FLOAT AVAILABILITY
5. We now receive (at no charge) information on daily debits and credits. Will your
bank be able to furnish this information from your branch every morning?
TELEBANK OR MICROLINK 2000.
6. You have been requested to state the rates for various services. Will those rates
apply to either payment options - Direct Fees or Compensating Balances?
NO PROPOSAL
7. Please note any additional charges or volume discounts that apply to all services
listed.
NO PROPOSAL
8. The City -may add facilities where by the daily balances, total debits and credits
now received by telephone, could be transmitted directly into our computer
facilities. Would there be any difference in charges for this method? If so, please
state:
Under Fixed Fees - Payment Option 1
PLEASE SEE MICROLINK 2000 - PRICING SCHEDULE
Under Compensating Balance - Payment Option 2
MICROLINK 2000 CHARGES WOULD BE APPLIED
TO ACCOUNT ANALYSIS.
9. Can you provide a float analysis report and indicate the cost for:
a) one day report, b) one month report.
MICROLINK 2000 SOFTWARE PROVIDES REPORT
OFF OF YOUR TRANSACTIONS DAILY OR WHATEVER
PERIOD OF TIME YOU SELECT - REAL TIME.
Please attach Float Availability Schedule.
SEE ACCOUNT TERMS AND CONDITIONS PAMPHLET
�I�VALENCIA
NATIONAL BANK
HISTORYAND FINANCIAL SUMMARY OF
VALENCIA NATIONAL BANK
Valencia National Bank is first and foremost a Community Bank
focused on serving the needs of the Santa Clarita Valley business market.
Valencia National Bank has developed a reputation for unsurpassed services
within the business markets that it serves and has become the "Businesses
Bank of Choice" for the Santa Clarita Valley. Our customers range from New
York Stock Exchange businesses to our community "owner operated"
businesses. Many of the "pillars" of the business community are our customers.
Valencia National Bank currently serves its customers through three
offices strategically positioned in the City of Santa Clarita. Each office is
geared to provide businesses with ready access to quality financial services.
Established in 1987 as a Southern California community bank, we are federally
chartered and a member of FDIC.
If you desire, references can be furnished with confidentiality.
23620 Lyons Avenue, Santa Clarita, California 91321 / (805) 254.9900 Fax: (805) 254.9904
✓VALENCIA
NATIONAL BANK
STAFF AND KEY PERSONNEL
One of our strongest assets of Valencia National Bank are our
people. We currently have a staff of over 50 people strategically placed
in three branch locations throughout the City. Together we have over
625 years of banking experience. Our Senior Management team alone
has over 100 years of "big bank" experience. We are fond of saying
that "we are a big bank in community bank clothes"- but without the
"big bank" frustrations.
23620 Lyons Avenue, Santa Clarita, California 91321 / (805) 254-9900 Fax: (805) 254.9904
IW/� VALENCIA
NATIONAL BANK
KEY MANAGEMENT PERSONNEL
John M. Reardon, President and Chief Executive Officer
John has over thirty-five years of banking experience, a good amount of which he spent as Senior Vice President
and Regional Manager of Wells Fargo Bank. Prior to coming to California, John served as Chairman and Chief
Executive Officer of Southwestern Bank and Trost Company, and as Executive Vice President of The First National
Bank and Trost Company, both in Oklahoma City. John received his Bachelor of Science in Marketing from
Oklahoma State University. He also attended the Southwestern Graduate School of Banking at Southern Methodist
University. John is a resident of the Santa Clarita Valley,
James D. Hicken, Executive Vice President and Chief Lending Officer
Jim has twenty years in the banking industry, the majority within the Southern California area. Jim served for seven
years as Senior Vice President and Senior Loan and Credit Officer with Metrobank. Jim also worked with Union
Bank for nine years as Vice President and Senior Account Executive. Prior to moving to Southern California, Jim
served as Funds Management Officer and Assistant Controller with First Interstate Bank of Utah. Jim is a graduate
of the University of Utah and holds his Bachelor of Science degree in Accounting. Jim is also a resident of the
Santa Clarita Valley.
Jeffrey Pollard, Executive Vice President and Chief Financial Officer
Jeff has over fourteen years in the finance industry, the last ten of which he has spent in banking. Prior to joining
Valencia National Bank in 1994, Jeff was Controller for First Los Angeles Bank for six years. He spent two years
with Security Pacific National Bank as Financial Reporting Manager and Derivative Product Analyst, as well as
three years as Senior Auditor for Coopers & Lybrand. A graduate of California State University, Los Angeles,
Jeff holds his Bachelor of Science Degree in Business Administration. Jeff is also a Certified Public Accountant.
Jeff resides in the Santa Clarita Valley.
Daniel G. Shumovich, Senior Vice President and Chief Credit Administrator
Dan has ten years of banking industry experience, eight of which he spent with the Office of the Comptroller of
the Currency as a National Bank Examiner. Most recently, Dan served as Senior Vice President and General
Auditor for Ventura County National Bancorp. Dan received his Bachelor of Science in Business Administration
Finance from California State University, Northridge.
Kris Hough, Vice President and Director of Branch Operations
Kris has spent her entire career of twenty-two years in the banking industry, all with Wells Fargo Bank prior to
joining Valencia National Bank in January 1997. Kris began her career as a teller and held positions of Branch
Service Manager, Regional Staffing Specialist and Region Service Specialist prior to becoming Vice President and
Manager of both Wells' Canyon Country and Valencia offices.
Janet Ages, Vice President and Operations Administrator
Janet was a founding employee of the bank in 1987, when she joined the bank as a teller. Janet has held the
positions of Administrative Assistant, Operations Officer, Assistant Vice President/Cashier, AVP/Controller and
AVP/Compliance Officer during her career with Valencia National Bank. Janet attended California State
Polytechnic, San Luis Obispo.
Linda Camarillo, Kathie Ellyson and Janet Olmos
Assistant Vice Presidents and Branch Service Managers ;
Linda, Kathie and Janet have been with the bank for nine, ten and six years, respectively. Linda served as a teller
prior to being promoted to Operations Officer. Kathie was a founding member of the bank, when she joined as a
merchant teller. Janet began her Valencia National Bank career as a teller as well, serving as utility and Operations
Officer prior to becoming Branch Service Manager.
23620 Lyons Avenue, Santa Clarita, Callfornla 91321 1 (805) 254-9900 Fax: (805) 254.9904
4/� VALENCIA
IWNATIONAL BANK
SHOP LOCAL ---
BANK WITH THE BANK THAT SUPPORTS
THE COMMUNITY
Valencia National Bank is made up of many diverse entities all
which support the Santa Clarita Valley and more importantly the City of
Santa Clarita:
Our customers are local residences and businesses. As the
bank grows our efforts to support the community
through loans and financial investment of money
helps individuals have more resources to invest in
families, their businesses and the and community. As
our business customers grow, they are able to hire
more employees - preferrably who live locally. Our
customers contribute to the City through tax dollars,
through sale of product, through services and employer
taxes.
Non -Profit organizations. This is part of the backbone of our
community which contributes to our "quality of life". VNB
contributes in time and cash contributions over twenty times
the amount Wells Fargo Bank and Bank of America do, yet
they are each three times our size in this valley. Where do
you suppose they invest their time and money?
The following is a partial list of the involvement of our
VNB employees in the strategic development of the
many Non -Profit Organizations:
Agua Dulce Chamber of Commerce - Board Member; Joni Nelson
COC Women's Conference - Board Member; Cathy Culotta
SCV Boys and Girls Club - Board Member; John Reardon
SCV Chamber of Commerce - Board Member; John Reardon
SCV Child and Family Development - Board Member; Jeff Pollard
SCV Education Foundation - Board Member; Cathy Culotta
SCV HMNMH Corporate Partners - Board Member; Jim Hicken
SCV HMNMH Foundation - Board Member; Suzy Reardon
SCV Mayor's Committee for Employment
of Individuals with Disabilities - Board Member, Kris Hough
SCV Y.M.C.A.•- Board Member; Cathy Culotta
23620 Lyons Avenue, Santa Clarita, California 91321 1 (805) 254-9900 Fax: (805) 254-9904
page 2
3.. Employees. We have over 50 employees, less than 1%
.live outside the Santa Clarita Valley. We are an example
of the type of business that the City of Santa Clarita
is trying to attract. As employees a great deal of us
own homes and pay taxes. We all shop locally, and raise
our families in the education systems.
4. Board of Directors. We have 9 board members, all who reside
in the Santa Clarita Valley and either own their business
or are in key management positions with major businesses
in the Santa Clarita Valley. Each and every board member
has been instrumental in the development of the Santa
Clarita Valley and some even in the formation of the City of
Santa Clarita.
BOARD OF DIRECTORS
Louis A. Garasi
Chairman of the Board
Valencia National Bank
Chairman & CEO
Gruber Systems
Thomas Dierckman
President
Valencia Company
Richard B. Keysor
Director
Keysor Century Corp.
Edward A. Cole, Jr.
President & COO
Answer Products, Inc.
Walter R. Fisher, Jr.
Owner
F & Y Cattle Co.
Richard A. Patterson
Attorney -At -Law
John M. Reardon Steve Schmidt
President & CEO Investments
Valencia National Bank
Will Staats, Jr.
Director & Owner
Staats Construction
page 3
5. Shareholders. We have over 350 shareholders, the vast
majority reside in the Santa Clarita Valley.
6. Valencia National Bank. We are celebrating our tenth
birthday this year as the only "Community Bank" in the
Santa Clarita Valley. We were formed as the result
of a need in the local business community to have a
bank that would be responsive to their needs. As an
employer, and a property owner we contribute greatly
to the financial support of the City. As a force of over
50 we contribute greatly to the physical support and
growth of the "values" that make Santa Clarita a
great place to live, work and play.
XI. REFERENCES
A. The following reference information is required by at least two (2) local government
accounts currently serviced by your bank, By providing this information, it is understood
that the City may contact any of these account holders for reference information. In
particular, please include any Local Government Account serviced by your Santa Clarity
branch.
PHONE
LOCAL GOVERNMENT UNIT CONTACT PERSON NUMBER
NEWHALL COUNTY WATER DISTRICT KARIN RUSSELL (805)259-361
B. The following reference information is required for at least two (2) commercial accounts
currently serviced by the branch location that will service the City's accounts. By
providing this information, it is understood that the City may contact any of these account
holders for reference information. Commercial accounts whose owners serve .in any
official capacity with the proposing firm should not be listed as a reference.
PRINCIPAL PRODUCT COMPANY TELEPHONE
COMPANY NAME OR SERVICE CONTACT PERSON NUMBER
AMID, INC(McDonalds) retail Anton Shutz (805) 252-1480
CROWN MANAGEMENT property mgrs Nancy O'Neil (805) 295-8494
R A H Industries manufacturing Sandy Hansen (805) 295-5190
SCICON TECHNOLOGIES manufacturing Tom Bulger (805) 295 8630
gW� VALENCIA
NMONAL BANK
REFERENCES FOR
MICROLINK 2000
Betty Reed Jennifer Greene
GRUBER SYSTEMS, INC. CROWN MANAGEMENT
25636 Avenue Stanford 28245 Ave. Crocker, # 104.
Valencia, CA. 91355 Valencia, CA. 91355
(805) 257-4060 x 326
FEATURES USING:
Balance reporting
Data Exchange accounts
going to ACH corporate
cash consolidation
Cindy Gualtied
CHANNEL & BASIN RECLAMATION
15218 Sierra Hwy
Saugus, CA. 91350
(805) 250-2970 x 100
FEATURES USING:
Balance reporting
Internal transfers
Stop payments
ACH - tax payments and
quarterly reporting
(805) 295-8494 x 203
FEATURES USING:
ACH - Payroll direct deposit
ACH - Homeowners direct
payment of dues
Len Clapp
HEDMAN & ASSOCIATES, CPA
24300 Town Center Dr., Ste 210
Valencia, CA. 91355
(805)287-6333
FEATURES USING:
ACH payroll and expense reports
. direct deposit
ACH for EFTPS
23620 Lyons Avenue, Santa Clarita, California 91321 / (805) 254-9900 Fax: (805) 254-9904
410
♦VALENCIA
IWNATIONAL BANK
CITY OF SANTA CLARITA
CONVERSION ISSUES & TIME LINE
CONVERSION ISSUE RESPONSIBILITY TIME FRAME
1. Set up all VNB bank accts City and K Ellyson 1 week
to establish account
numbers
2. Identify and notify all ACH City and C. Culotta 2 weeks / 1 mth.
transactions with new
bank, Route #, and Acct #
i.e., EFTPS
3. Identify and notify all wire City and K. Ellyson 2 weeks
transfer locations with
new bank, Route #, and Acct #
4. Order new checks City and K. Ellyson 2 weeks
5. Order new endorsement stamp City and K. Ellyson 2 weeks
6. Order/ install Microlink
software City and C. Culotta 2 weeks/ 1 mth.
7. Order Visa / MC corporate
credit cards City and K Ellyson 2 weeks
8. Set up Armored Car Service City and K Ellyson 2 weeks
9. Set up Courier Services City and K. Ellyson 1 week
10. Establish and notify - City and K. Ellyson 2 weeks
procedures for nite
drop for remote locations
i.e., Parks & Rec
11. Establish and notify City and K.Ellyson 2 weeks
procedures for coin processing
23620 Lyons Avenue, Santa Clarlta, California 91321 / (805) 254-9900 Fax: (805) 254-9904
automated paymm &
coecrions
We've made Automated Clearing
House (ACH) Initiation easy by using
ramiliar phrases and terminology.
Now, you can initiate electronic
payments and collections in a few
keystrokes — saving you time with
check deposits and reconcilement -
making
making cash flow forecasting
easier... accelerating your funds
availability... and reducing the
clerical cost of account
reconcilement.
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NATIONAL BANK
■ Initiate ACH transactions for a variety of purposes, including:
■ Funds concentration
■ Direct deposit of payroll
■ Vendor payments
■ Insurance premiums
■ Dues collections
■ Tax payments
and morel
■ Compose transactions with ease by entering an Instruction ID
with a settlement date, purpose and amount. Transactions can be
created individually or in groups. Best of all, you only need to set
up instructions once for the types of payments and collections
you require for your cash management operations— payroll,
consumer and corporate. Once preset, you can efficiently use
these same instructions over and over again, every time you
initiate a transaction.
■ Customize Instruction IDs to identify the credit (payment) or
debit (collection) party.
■ Import instruction ID and transaction Information from
other software programs, such as accounting or payroll
packages, without the need for rekeying, saving you time and
improving accuracy.
■ Export transaction Information, which allows you to create a
transaction file containing the required data as you set it up, and
then use it In another system In any manner you choose.
■ Receive reports on your transactions directly from your PC.
Once composed and sent, your transactions are automatically
transmitted to the bank in a NACHA formatted file. These transac-
tions are also stored on your PC so you can review them in
reports by status, account, Instruction, transaction group or batch.
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9 account reporting
prior/current day & historical
Here's the information you need to
make sound financial decisions
and keep an edge in today's
fast -paced business world:
your complete financial positron,
including up to 63 days of historical
data, all retained for easy reference.
on your PC. And if opportunity
knocks today— for investments,
borrowing, funding, or even
purchasing — you'll be ready to
answer because your PC can
provide an up-to-the-minute profile
of your complete financial position
with Current Day Transaction
Reporting.
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NArnONAL BANK
■ Increase control over your funds by monitoring the day's
account activity such as incoming payments, check disbursements
and funds transfers. Descriptive detail transactions—float
amounts, check numbers, reference numbers, as well as unlimited
descriptive text—will help you reconcile your payables and
receivables throughout the day, and make ft easier to determine
availability of funds.
■ Consolidate multibank information onto one easy -to -read
report that can be displayed on your PC or primed as a hard copy.
No need to wait for multiple monthly statements; a consolidated
snapshot of all your accounts Is ready whenever you want it and
for the time period you specify.
■ Display reports that reflect same day information, such as:
Account Data Status . date stamp to Indicate the most
recent data available
Summary Balance . review of key account data
at a glance
Balance Detail . detailed review of various balance
values Qedger, collected, available
and transaction totals)
Account Statement . an easy -to -read examination of your
balances and transactions in a format
that's similar to your bank checking
PLUS statement
Transaction Detail
Transaction Search' detailed, hem -by -item reports,
Cleared Check Inquiry lust the way you like them
■ Customize reports that reflect the way you do business. You
can define the order in which you want accounts displayed, set up
subtotals, and establish month -to -date and year-to-date balances.
You can also set up a standard table to convert bank numeric
transaction codes into more understandable descriptions, which
will then be displayed on your bank account reports for all your
reporting banks.
■ Protect your Information with simple and easy-to-use data
backup functions that store your data on diskettes.
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NArnONAL BANK
■ Increase control over your funds by monitoring the day's
account activity such as incoming payments, check disbursements
and funds transfers. Descriptive detail transactions—float
amounts, check numbers, reference numbers, as well as unlimited
descriptive text—will help you reconcile your payables and
receivables throughout the day, and make ft easier to determine
availability of funds.
■ Consolidate multibank information onto one easy -to -read
report that can be displayed on your PC or primed as a hard copy.
No need to wait for multiple monthly statements; a consolidated
snapshot of all your accounts Is ready whenever you want it and
for the time period you specify.
■ Display reports that reflect same day information, such as:
Account Data Status . date stamp to Indicate the most
recent data available
Summary Balance . review of key account data
at a glance
Balance Detail . detailed review of various balance
values Qedger, collected, available
and transaction totals)
Account Statement . an easy -to -read examination of your
balances and transactions in a format
that's similar to your bank checking
PLUS statement
Transaction Detail
Transaction Search' detailed, hem -by -item reports,
Cleared Check Inquiry lust the way you like them
■ Customize reports that reflect the way you do business. You
can define the order in which you want accounts displayed, set up
subtotals, and establish month -to -date and year-to-date balances.
You can also set up a standard table to convert bank numeric
transaction codes into more understandable descriptions, which
will then be displayed on your bank account reports for all your
reporting banks.
■ Protect your Information with simple and easy-to-use data
backup functions that store your data on diskettes.
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account reporting .
with
check manager & accounting connection
Check Manager is an electronic
checkbook enabling you to record,
print reconcile and report on all
check disbursements for your
company—right from your PC.
There's no limit to the number of
accounts you can manage, and
there's no telling how much time
and effortyou'll save when
balancing your company books.
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for easier reporting and Inquiry, as
well as the automated reconcilia-
tion. Easier because there's no
need to enter data twice — it's all
automatically integrated into your
cash management system from
your otherprograms!
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NATIONAL BANK
■ Recordcheckinformation by entering It into an electronic
check register. A convenient Vendor/Payee Directory provides a
handy shortcut for parties to which you frequently write checks.
Just recons the payee information once, and a simple code recalls
the details whenever you need them. At any time, you can review
information stored in your check register and even make adjust-
ments if checks are voided or stopped.
■ Print checks automatically— right from your own printer—
as you record them in your check register. After printing, you'll get
a Daily Printed Check Register Report for your audit records,
describing each check in detail.
■ Reconcile checks quickly and accurately as your PC automati-
cally matches the issued check information to your paid check
information, available through the Bank Account Reporting func-
tion. A Check Reconciliation Report provides you with the number
of each check and total dollar amount paid, stopped, voided,
mismatched and outstanding — for any period of time you specify.
■ Review check status through a variety of reports:
Single Check Inquiry w allows you to look up a specific
check by check number or amount
Check Listings . for details about checks by category,
such as paid, outstanding, stopped or
by payee
Check kegister . a concise listing of all checks issued
in check order number
Float Analysis Report . identifies, by payee, the time it takes
for checks to clear, aiding in the
analysis of your disbursement
clearing time
■ Export cheek data and vendor/payee data from Check
Manager to other software programs, such as spreadsheet,
database manager and accounting packages, for further analysis
and recordkeeping.
,
■ Import cheek data including check and vendor/payee
Information from your accounts payable system or an
approved vendor list
bask account reporting
and
dd WOCkSheet
Need to get a handle on your
complete financial position?
Looking to consolidate yesterday's
account balances, this morning's
controlled disbursements, lunch-
time lockbox deposits and the
afternoon ACH or wire payments?
Daily Worksheet does it automati-
caW by posting all of these Hems
to a'Worksheet"you design.
Eliminate paper -intensive recording
and planning—now you can
automatically post financiaf data
(e.g., available balances, incoming/
outgoing money transfers) to your
PC on a Daly Worksheet
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NATIONAL BANK
■ Eliminate paper -intensive recording and planning by having
your financial data posted to your PC — automatically!
■ Customize your worksheets to detail specific Information or
information that may be unique to your company, such as
■ End -of -day position
■Daily cash flow requirements
■ Investment opportunities
■ Borrowing needs
■ Historical trends
and morel
■ Consolidate yesterday'a balances with today's activities,
such as collections and disbursements, for example, In order to
more accurately see your current cash position after ACH
disbursements or incoming wire receipts.
■ Create an Integrated picture of today's and any futureday's
cash position.
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NATIONAL BANK
■ Eliminate paper -intensive recording and planning by having
your financial data posted to your PC — automatically!
■ Customize your worksheets to detail specific Information or
information that may be unique to your company, such as
■ End -of -day position
■Daily cash flow requirements
■ Investment opportunities
■ Borrowing needs
■ Historical trends
and morel
■ Consolidate yesterday'a balances with today's activities,
such as collections and disbursements, for example, In order to
more accurately see your current cash position after ACH
disbursements or incoming wire receipts.
■ Create an Integrated picture of today's and any futureday's
cash position.
I
nternal transfers
IW/� VALENCIA
NATTONAL BANK
Internal Transfers are a convenient and cost-effective way to move
funds between your business accounts at our bank without making a
telephone call or a trip to the bank. Simply select from available
accounts, and specify a dollar amount and transfer date. It's that
easy — plus you even get an audit trail of your most recent 200
transfers via an Internal Transfers Log.
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stop payments
We've just improved the speed and efficiency of your operations.
Now you can send stop payment instructions on a single check or
range of checks directly to the bank from the convenience of your
office PC. No telephone calls or follow-up letters are necessary. The
bank will provide you with an electronic mail message confirming that
checks have been stopped or paid. What's more, a Stop Payments
Log allows you to Inquire about your most recent 200 stop payment
requests, providing a comprehensive audit trail for your records.
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wiretransfers
With this complete international
wire system, you can compose and
send wire transfers to the bank for
processing, easily and securely.
Confirmation on the disposition of
each transfer is automadcalfy sent
to your PC, along with reports on
the status of each wireyou have
composed. Plus, you'll find every
transaction saved and recorded for
auditing purposes.
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4W-A^
BANK
■ Repetitive transfers are easier than ever to handle. At your request,
we can program into the system, constant information about debit
and beneficiary parties with which you often do business. Then, a
special shortcut function lets you recall that information whenever
you create transfers — at the touch of a button.
■ Infrequent transfers allow you to supply the beneficiary Informa-
tion at the time of composition.
■ Future transfers can be easily composed at your convenience,
_ stored and released when appropriate.
■ Reporting options. include detailed transaction inquiries for all
outgoing wire transfers. .
■ Security through such precautions as:
■ Data encryption for all transaction data
■ Approval levels you can set, requiring up to two levels of
approval each made by different users. Additional security is
also possible by having a third and fourth user compose and
send your transfers
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MICROLINK® jjNhLdAlOF,u.101,41.
standard products
Complete with your other cash
management service modules,
comes a number of standard
functions designed to improve ■ Communications transmits your bank account information,
operations and help keep your money transfer instructions and confirmations, and mail messages
system running error -free: directly to your PC. You have a choice of several convenient ways
to receive your data —even having your PC call during the night
to receive, so everything Is waiting for you in the morning! Flexible
and adaptable to your needs, Communications also helps you set
up communication links to other on-line and PCAocal services
your company has (such as stock quote or timesharing services,
or a word processing application) via a built-in Corporate Services
Setup function. The software automatically records your
keystokes as scripts which can then be used again and again.
■ E -Mail lets you communicate with the bank or technical customer
service, electronically informing either party of your needs and
requests. You can also receive messages from the bank when you
first sign on each day.
■ Maintenance functions allow you to erase unused or unwanted
data, back up your databases to floppy diskettes for historical
data retrieval, change your passwords, display maintenance
reports and set up your printer so that It will print your reports with
"extras" like highlighting and proportional. spacing.
t)
'the Currency
of National Banks
PUBLIC DISCLOSURE
April 22, 1996'
COMMUNITYREINVESTMCNT ACT
PERFORMANCE EVALUATION
Valencia National Bank
Charter Number 21277
23620 Lyons Avenue
Newhall, CA 91321
Office of the Comptroller of the Currency
Western District
50 Fremont Street, Suite 3900
San Francisco, California 94105
(415} 545-5900
NOTE: This evaluation is not, nor should it be construed as, an assessment of the financial
condition of this institution. The rating assigned to this institution does not
represent an analysis, conclusion or opinion of the federal financial supervisory
agency concerning the safety and soundness of this financial institution.
GENERAL INFORkAZYON
The Community ReInvestmentAct (CRA) requires each federal financial supervisory agency
to use its authority when examining fmancial institutions subject to its supervision,- to assess
the institutions record ofineeting the credit needs of its entire community, including low -
and moderate -income neighborhoods, consistent with safe and sound operation of the
institution. Upon •conclusion of such examination, the agency must prepare a written
evaluation of the' institution's record ofineeting the credit needs of its community.
This document is an evaluation of the Community Reinvestment Act (CRA) performance of
Valencia National Bank prepared by The Office of the Comptroller of the Currency, the
institution's supervisory agency, as of April 22, 1996. The agency rates the CRA
Performance of an institution consistent with the provisions set forth in Appendix A to
12 C.F.R.Part 2S.
`INS�1 "M- ON'S ('RA RA Valencia National Bank's CRA performance rating is
Satisfactory.,,
Although the bank's loan to deposit ratio is low, the distribution of its loans to different
income levels and to businesses of different sizes is satisfactory. Also, a majority of the
bank's loans are to individuals and businesses within its assessment area.
The following table indicates the perrformance level of Valencia National Bank with respect
to each of thcfive performance criteria.
FFS�'I'
Valencia National Bank
INSTTrMON
Performance Levels
ASSESSMENT
CRITERIA
sem.
w x r
Exceeds Standards
Meets Standards
Does not meet
farSatisfado ry
for
Standards for
�
.
Performance
Satisfactory
Satisfactory
'
Performance
Performance
Loan to Deposit Ratio
X
Lending in Assessment
X
Area
Lending to Borrowers of
X
Different incomes and to
businesses of Different -
sizes
Geographic Distribution
Not Meaningful
of Loans
,
Response to Complaints
No complaints were received since the last examination
2
MI
DESCRIPTION OF INSTTT MbN:
Valencia National Bank (VNB) is an $80 million commercial bank that opened in 1987. The
bank's corporate office and three branches are located in the Santa Clarita Valley,
approximately 35 miles northwest of the City of Los Angeles.
VNB's primary competition comes from the branches of two San Femaado Valley
independent banks and two major banks: The bank's primary focus is commercial lending.
VNB's loan pbrtfolio at March 31, 1996 was centered in commercial real estate (491/6),
commercial (32%), and consumer (19%). The bank has rebounded from problems with its
loan portfolio that began during the Southern California recession in the early 19901s. The
bank faces significant competition for -commercial lending business in the area. The bank
has recently hired business development officers to help increase the volume of new. loans.
DESCRIPTION OF ASSESSMENT AREA:
The bank's assessment area consists of nineteen census tracts within the Los Angeles
Metropolitan Statistical Area (MSA). The assessment area consists of zero low- or
moderate -income census tracts, one middle-income census tract and eighteen high-income .
census tracts. The population in the area is 141 thousand. The recession of the early 1990's
impacted the area, which saw real estate values drop significantly. The assessment area
remains a high cost area with a median housing value of $234,300. The Census MSA
median family income is $39,035.
As partof this examination we conducted community outreach with local civic and
government organizations. Through these activities we noted the primary credit needs in the
assessment area is for small business and consumer loans.
K
CONCLUSIONS WI'T'H RESPECT TO PERFORMANCE CRITERIA: .
Loan to Deposit Ratio:
VNB's 1995 average loan to deposit ratio at 47Yo does not meet the standards for satisfactory
Performance- The average loan to deposit.ratio offive similarly situated banks is 69%. The
bank's loan to deposit ratio has declined 17% over the Iast three years. The decline in the
ratio is due in part to the bank's focus on reducing the high level of problem loans it
experienced as a result of the Southern California recession in the early 19901s. However,
the similarly situated banks we surveyed also faced high levels of problem loans due to the
recession, but were able to maintain higher loan to deposit ratios.
Lending in Assessment Area:
VNB's performance in lending within its assessment area is satisfactory. The following table
illustrates the bank made a majority of the loans in the portfolio as of March 31, 1996, to
individuals and -businesses within its assessment area.
Loans Made within the Assessment Area
Total Loans
Total Loans
tage
by Dollar Amount
Made Within
and Number
Assessment Area
;74.94%
$38,087,623
$27,501,737
1%
790
592
Lending to Borrowers of Different Income and to Businesses of Different sizes:
We sampled the bank's three main loan products: commercial real estate, commercial, and
consumer. Our sample. included 50 of the 290 loans VNB originated (or 17%) between
June 1995 and February 1996. We focused on determining the volume of the bank's lending
activities to low- or moderate -income individuals, and to businesses with revenues of
$1 million or less. We found the bank's lending activity effectively reached both low -,and
moderate -income individuals and small businesses. We detail our findings in the following
tables.
r?
Extensions of Credit to, Individuals of Different Incomes
Sample Findings
Income Level
of Borrower
% of Consumer Loans
by income
% of Families Within
the Assessment Area
by Income
Low Income
11%
7%
Moderate Income
7%
9%
Middle Income
26%
18%
High Income
56%
65%
Of the loans included in our sample, the bank made 18% of the consumer loans to low- or
moderate -income individuals. This compares favorably to 16% of the families within the
bank's assessment area identified as low- or moderate -income.
Loans to Businesses of Different Sizes
Sample Findings
Size of Business
Commercial Real
Commercial Loans
Estate Loans
Revenues of
91%
75%
$1 million or less
Revenues greater
9%
25%
than$1 million
As illustrated in the above table, we found the bank made a significant majority of its
commercial real estate and commercial loans to small businesses (businesses with revenues
of$I million or less).
5
Geographic distribi Pion of loans:
A geographic distribution of VNB's loans would not be meaningful as zero of the 19 census
tracts within the bank's assessment area are low- or moderate -income. Therefore, we did not
Perform an analysis of the geographic distribution of the bank's loans during this
examination.
Discriminatory Practices:
We completed a concurrent fair lending review and found no evidence of any prohibited or
discriminatory practices. We also found the bank complies with the provisions of the anti-
discrimination laws and regulations.
0
EXHIBIT H
03/19/97 1T:31 M 8052549904 V:ATENCIA BANK .. CIT1 HALL 0002
VALENCIA
NAMMi BANK
March 19, 1997
Ms. April Jordon
Accountant
City of Santa Clarita
23920 Valencia Blvd. Suite 300
Santa Clarita, CA. 91355
SUBJECT: REQUEST FOR PROPOSAL FOR BANKING SERVICES -
CLARIFICATION ISSUES
Dear April,
In response to your letter of March 19, 1997; we have reviewed
the code sections applicable and are in compliance with those sections
sighted. Specifically Governmental code sections 53652 and 53656
which discuss collateral requirements of the depository, we are currently
in possession of deposits from public agencies and in addition are an authorized
depository for the State of California.
If there are any additional concerns regarding this matter, please
contact me.
Sincerely,
Jeffrey Pollard
Executive Vice President
and CFO
'23620 Lyons Avenue, Santa Clorlto. California 91321 / (8051254-9900 Fnr- rRns, oae_oonA
EXHIBIT I
'VALENCIA
NATIONAL BANK
March 25, 1997
Ms. April Jordan
City of Santa Clarim
23920 Valencia Blvd., Suite 300
Santa Clarita. CA 91355-2196
Dear Ms. Jordan:
In response to your letter dated 20 March 1997, the following are Valencia National Bank's responses:
L A copy of the Contract for Deposits at Local Agency Funds and Waiver of Security is enclosed.
2.
Jeffrey Pollard, CPA
Executive Vice President
Chief Financial Officer
a) Securities that will collateralize said deposits are United States Treasury Securities and United States Agency Securities.
b) Securities used to collateralize said deposits will be kept in a safekeeping account at the Union Bank of California. Union Bank
of California indeed meets all of Government Code Sections 53656 and 53657.
C) The City's deposits will be collateralized as follows:
The first $100,000 would be insured via FDIC insurance
The remainder would be collateralized at 110% of the amount
d) The Bank monitors public agency deposits daily via data reports that indicate the total deposits for public agencies. On a weekly
basis, a report is submitted by the Bank to the Administrator of Local Agency Security in San Francisco, California. The report is
titled "Weekly Report of Local Agency Deposits." On a quarterly basis, a report of Quarterly Local Agency Deposits" which is
prepared by Valencia National Bank and audited by Union Bank of California and then submitted to the Administrator of Local
Agency Security. The Bank will notify the City when collateral requirements are not being met.
C) Upon execution of the Contract for Deposit of Local Agency Funds, the Bank states formally on that agreement its net worth.
Subsequently, the Bank publishes quarterly statements that indicate its net worth for third parties that arc required to perform any
monitoring of that amount.
f) The Bank could provide, if requested, copies of reports submitted to the focal Agency Administrator, from First Tennessee Bank
that performs Valencia National Bank's investment securities accounting, from Union Bank of California on the safekeeping
account securities, which is a trust account and requires approval. from the Local Agency Administrator prior to any changes in
securities in that account
We hope that these responses addressed all of your concerns and certainly if there are any additional questions please do not hesitate to
contact me.
Since
qpt
JP/kb
23620 Lyons Avenue, Santa Clarito, California 91321 (805) 254-9900 TAX (805) 254-9904
EXHIBIT J
VALENCIA
�I0NATIONAL BANK
April 11, 1997
Mr. Steve Stark
Director of Administrative Services
City Treasurer
CITY OF SANTA CLARITA
23920 Valencia Blvd., Suite 300
Santa Clarita, CA. 91355
SUBJECT: ADDENDUM LETTER TO PROPOSAL FOR BANKING
SERVICES
Dear Steve,
RECEIVED
APR 14 1997
ADMINISTRATIVE SERVICES DEPAIITNW
CITY OF SANTA (LARITA
We are please to revise our proposal to better service the banking
requirements of the City of Santa Clarita. The total monthly fee charges
with the volumes given in the RFP will be $714.70 with an Average
Monthly Collected Balance Requirement of $193,686.00.
The additional services that we have changed are:
* Microlink 2000 software one-time license fee will be removed
• Courier charges will be $5.00 per pick-up
• Coin transactions will be deposited directly at the branch
locations
* Jeff Pollard has become a member of the California Municipal
Treasures Association.
" Pricing will be fixed for 3 -years with possible changes due to
CPI.
" Earnings Credit will be analyzed on an annual basis to allow
for any negative Earnings Credit in "lean" months that
you may have.
• We are very receptive to a 2 -year option subsequent to the
3 -year term.
Attached are the revised pages to our proposal for Section VII Required
Services. Thank -you for the opportunity, and we are looking forward to our
new banking relationship to serve you.
Sincerely,
Jeffrey Pollard
Executive Vice President
and CFO
23620 Lyons Avenue, Santa Clarita, California 91321 / (805) 254.9900 Fax: (805) 254-9904
VII. REQUIRED SERVICES
A. OPERATING ACCOUNT = Volume and nature of Unit Monthly
transactions Charge Charge
1. The City averages approximately 65 $ 1.40 $ 91.00
separate deposits a month.
2. Average number of checks deposited $ .10 $ 55.00
monthly: 550
3. The average number of checks to clear $ .14 $147.00
the bank per month is 1,050.
4. Returned checks average 18 per month. $ 5.00 $ 90.00
5. Stop payments average 4 per month. $15.80 $ 63.00
6. Bank must provide daily balance reporting N/C for Telebank
service that the City can obtain by 8:00 a.m. each Services
day for ledger, collected, and available balances,
and total debit and credit information, for the
previous day's activity.
7. Bank must be able to provide in and out wire See Below See Below
services for transfer of funds to and from other
financial institutions and brokerage firms within
the United States for various purposes. Such
transfers will be "same day."
Please state the time of day of the wire
deadline: 1:00�m
Average number of outgoing wires, initiated by $ 33.00 $165.00
the City, per month: 5
Average number of incoming wires, initiated by $ 10.00 $ 50.00
the City, per. month: 5
8. Bank will receive and guarantee immediate N/C N/C
credit on all incoming wire transfers. *received by 1:00 p.m.
9. All debit and credit confirmations must be Not Applicable
received by the City within three days following
the date transactions occur.
Discount Mo. Minimum
Rate Discount Charge
10. Bank must accept MasterCard/Visa deposits. 2.71% $15.00/month
if card not used
Average number of credit card transactions
per month: 500
COMMENTS:
The City of Santa Clarita Parks & Recreation Department as well as Finance Department have
been customers of the Valencia National Bank merchant card program since 1990 The $15.00
monthly minimum chafe only takes ,place if there are no transactions for the month To date, this
charge has not occurred
Inclusive Monthly Charges for General Account
Transactions Based on Volume as Described Above $661.00
B. ZERO BALANCE ACCOUNTS (ZBA)
The City may desire to maintain separate Zero
Balance Accounts tied directly to the operating
account. These are unfunded disbursement
accounts. The 'overdraft" created is covered
by daily transfers of funds from the operating
account as checks clear against the ZBA.
COMMENTS:
Inclusive Monthly Charge for ZBA Accounts on
Above Volumes
Unit Monthly
Charge Charge
0.00 $ 0.00
$ 0.00
C. DIRECT DEPOSITS
1. The Bank will accept direct deposits to the
City's account from the State of California
(almost entirely from the State Treasurer's
Office, State Controller's Office, and the U.S.
Treasury) and guarantee Immediate credit for
such deposits.
Average number per month: 4
2. The Bank will accept Automatic Payroll
Deposits on behalf of the employees of
Santa Clarita.
Number of employees with direct deposit
is approximately 200.
Please list the available options for
transmitting payroll data to your bank.
(Modem is preferred).
Modem
MicroLink 2000
The City currently employs approximately
200 people.
Bank will provide "same day" notification
to the City on all direct deposits.
COMMENTS:
Inclusive Monthly Charge for Direct Deposits
Based on the Volume Described Above:
$ .10 $ .40
Unit Monthly
Charee Charee
$ .05 $ 10.00
Plus $25.00 per payroll
transmission
Not Applicable
$10.40
ED
E.
IQ
BANK STATEMENTS AND RECONCILIATION
SERVICES
1. The City requires monthly Account Statements
for the Operating Account and two Zero Balance
Accounts. Account Statements must include
Advices for Debits, Credits, Adjustments, and
Cancelled Checks and be submitted by the 5th
working day of the following month.
2. The City requires that all debit and credit
confirmation slips are received within three
days following the date when the transactions
occur.
ARMORED CAR SERVICE
The -bank will provide armored car service three
days per week for funds in transit from Santa
Clarita City Hall to the bank at a time which will
ensure deposit on the same day as pickup.
ACCOUNT ANALYSIS STATEMENT
The Bank will supply a monthly account
analysis statement within five working days
after the close of each calendar month. Please
submit a copy of your Account Analysis
Statement.
COMMENTS:
Unit Monthly
Charge Charge
$ 21.00
Not Applicable
$ at our cost
N/C N/C
Unit Monthly
Charge Charge
G. FORMS
The Bank will furnish all necessary forms, Not Applicable
including but not limited to deposit slips,
stop payment forms, deposit bags (including
tags and fasteners), coin wrappers, etc.
excluding checks.
H. COIN COUNTER
The Bank will.furnish a coin counter to At our cost
the City to be kept on City's facilities.
I. COMMUNICATIONS
The Bank must designate a specific officer and Valencia Branch Service
an alternative to act as City liaison representative. Manager. Director of Branch
Services
Unit Monthly
Charge Charge
I DAILY BALANCE REPORTING
The Bank will provide daily balance reporting $ .11 $ 7.20
services by computer access so that the City can per transaction
obtain by 8:00 a.m. each day data on ledger,
collected and available balances and itemized
debit and credit information and cancelled checks
relating to the previous day's activity.
COMMENTS:
Valencia National Bank recommends the use of the MicroLink 2000 Balance Reporting Svstem
This state of the art service_ provides increased control and flexibility for managing the City of
Santa Clarita's business accounts. MicroLink provides a detailed review of various balance values
such as leder, collected, available, and transaction totals. Additionally MicroLink will generate
an easy -to -read report of your balances and transactions in a format similar to your bank checking
statement covering the time period you request It will allow the City of Santa Clarita to move
money -between anv and all accounts maintained with Valencia National Bank. as well as monitor
and control balances
Annual
K. VISA CREDIT CARDS APR Fee
The City of Santa Clarita has established 17.5% $ 0.00
two (2) credit cards for business use, with a
total credit line of $2,500.
COMMENTS:
The City has been a customer of Valencia National Bank since May of 1992, and is currently
utilizing credit card services The annual fee is per account therefore if using a second card on an
account already created there will be no additional charge
L. COMPUTER DATA OUTPUT
The City of Santa Clarita would like the ability
to download account information into its
financial system in order to complete such
automated functions such as check reconciliations.
If the bank desires to offer this service, a supplement
attachment should be prepared and included with
the proposal describing the service in detail. The
various options available for downloading (i.e. modem,
CD, floppy disk, etc.) should be indicated as well as
the cost, if any, for this service.
N/C N/C
SUMMARY -OF REQUIRED SERVICES:
* We used 90 day T Bill rate of 5% for illustrative purposes. Actual rate will vary.
AVERAGE MONTHLY
COLLECTED
SERVICE
MONTHLY FEE
BALANCE REQUIRED*
A.
OPERATING ACCOUNT
$ 661.00
$179,133.00
B.
ZERO BALANCE ACCOUNTS
$ 0.00
C.
DIRECT DEPOSITS
$ 10.00
D.
BANK STATEMENTS AND
$ 21.00
RECONCILIATION SERVICES
E.
ARMORED CAR SERVICES
At Our Cost
F.
ACCOUNT ANALYSIS
STATEMENT
$ 0
G.
COIN COUNTER
At Our Cost
J.
DAILY BALANCE REPORTING
$ 7.20
K.
VISA CREDIT CARDS
$ 2.00
L.
COMPUTER DATA OUTPUT
see attached
TOTAL MONTHLY FEE
$ 701.20
$ 190,027.00*
* We used 90 day T Bill rate of 5% for illustrative purposes. Actual rate will vary.
VIII. OPTIONAL SERVICES
Unit Monthly
Charge Charge
A. SAFE DEPOSIT BOX
The Bank may provide one (1) safe deposit box $ 8.35
for the City. The box should be large,
approximately 10" X 11" X 21" in dimension.
COMMENTS:
Largest safe deposit box size is 9" x 10"
B. MESSENGER SERVICE
The Bank may provide on-call messenger $ 5.00 $ as needed
service between City Hall and the bank.
COMMENTS:
Charge is $5.00 per call. With the close proximity of our branch to City Hall response time will
be excellent.
C. LOW INTEREST EMPLOYEE LOANS APR Loan Limit
The Bank may provide low-interest loans to * $30,000
employees for City -sponsored purchasing
programs.
*We will price our loans to City employees at 50 basis points below our stated pricing,
except for home loans.
D. SAFEKEEPING OF INVESTMENTS
Under the rules and regulations of Government
Code Section 53608, the Bank may provide third
party custodial services for all securities that the
City purchases from any source. All securities
must be received and delivered using standard
delivery versus payment (DVP) procedures which
ensures that securities are deposited with the
custodian bank prior to the release of funds.
The average number of securities purchased
per month is: 2 to 3
The average number of maturities per month
is: 2 to 3
The average size of the City's investment
portfolio is $30,000,000. Of this amount
approximately 50% is invested in LAIF and
is not subject to safekeeping.
Unit
Charge
No Proposal
2. The Bank shall provide monthly statements Not Applicable
listing the securities inventory held in safe-
keeping and shall provide a receipt for
securities deposited and interest payments and
a credit advice for securities sold or matured.
Will Bank provide assured same-day credit
of the City's account at each investment
maturity date in the amount of all principal
and interest due, or will it credit only upon
receipt of that amount from the institution
which delivers the funds?
(Note: The City presently receives the assured
same-day credit so that it inevitably may invest
matured funds on the maturity date. Lack of
investment capability would be considered a
serious deprivation.) Indicate any charges related
to providing inevitable availablility of funds in
these circumstances.
No Proposal
Monthly
Charge
SUMMARY OF OPTIONAL SERVICES:
SERVICE MONTHLY FEE
A. SAFE DEPOSIT BOX $ 8.50
B. MESSENGER SERVICE $ 5.00 per call
C. SAFEKEEPING OF No proposal
INVESTMENTS
TOTAL MONTHLY FEE $ 13.50
AVERAGE MONTHLY
COLLECTED
BALANCE REQUIRED
As needed
$ 3,659.00
IX. ADDITIONAL SERVICES
A. MISCELLANEOUS SERVICES
Use this item to elaborate on services your bank will offer the City which are not covered
in the previous sections.
File No.
Depository_
Treasurer
Agent of Depository,
Auditor
CONTRACT FOR DEPOSIT
of
LOCAL AGENCY FUNDS
(Active and Inactive Deposits)
No. Complete All Applicable Blanks
(a)
(Depository's net worth)
vM5
(b) $ (Depository's paid-up capital and surplus)
(c) Agent of Depository,
(d) Security Safekeeper
The undersigned designated as "Treasurer", acting in the official
capacity and for the Depositor named below (herein called Treasurer),
and the undersigned designated as "Depository" (herein called
Depository), agree as follows:
1. Representations. Treasurer proposes to deposit moneys in
Treasurer's custody with depository from time to time. At no time
will the amount of deposit exceed the lesser of Depository's paid-up
capital and surplus or Depository's net worth. In Treasurer's
judgment this contract is to the public advantage. Depository
represents that as of the date hereof, its net worth and the total of
its paid-up capital and surplus are not less than the amounts shown
at (a) and (b) above.
2. . Governing Law and Compliance. This contract is entered into
pursuant to California Government Code Section 53649, and the parties
will comply in all respects with, and all deposits hereunder shall be
governed by, Title 5, Division 2, Part 1,.Chapter 4, Article 2 of -the
California Government Code (herein called Governing Statute) and all
other provisions of state and federal law and regulations applicable
to such deposits.
3.. Deposit Receipt. At the time of each deposit, Depository will
shall
issue a receipt to Treasurer in form agreed to by them. The receipt
durationaOf.the dep te sit interest
the terms b or awithdrawal. Eachthe rateereof the
ceipt
shall be part of this contract.
4. Interest. If interest is payable on a deposit it shall be
Paid monthly, at such rate as Treasurer and Depository agree upon for
the deposit, and computed on a 360 -day basis on the average daily
balances of the deposit.
5. Maintaining Security -Non -REN and REN security:
As security for deposits under this contract, Depository, at
all times and pursuant to California Government Code Section
53656 and 53658, will maintain with the Agent of Depository
named at (c) above eligible securities as listed in
subsections (a) through (1), (n) and (o) of California
Government Code Section 53651 (herein -call "Non REN Security")
and/or promissory notes secured by first mortgages and first
trust deeds'upon improved residential property in California
(herein "REN security"). At all times, when any of
Depositor's monies on deposit with Depository under this
contract are secured by Non -REN security, the market value of
such security shall be at least 10 percent in excess of the
actual total amount of such monies of Depositor, and when any
of Depositor's monies on deposit with Depository under this
contract- are secured by REN security, the value of such
security shall be at least..5o percent in excess of the amount
Of such monies of Depositor.
6. Depository's Default. If Depository fails to
y all or an
part of a deposit made and secured by securities under this contract
when ordered to do so in accordance with the terms of withdrawal set
forth on the deposit receipt, Treasurer will notify the Administrator
in writing, who then will order the necessary securities converted
into money for the benefit of Depositor as provided in California
Government Code Section 53665. Further,. upon notice to the treasurer
from the administrator, the Treasurer may withdraw deposits in the
event a depository fails to pay all or any part of the assessments,
fines, or penalties assessed by the administrator or may withdraw
authorization .for the placement of pooled securities in an agent of
deposor
iry in the event that the agent of depository fails to pay the
penalties assessed by the administrator.
7. Agent of Depository. The Agent of Depository has filed, with
Administrator, an agreement to comply in all respects with the
Governing Statute, a copy of which agreement is attached to this
contract. The Agent of Depository is authorized to hold the
securities maintained as provided in paragraph 5 above and to place
them for safe keeping, in accordance with California Government Code
Section 53659, with and Federal Reserve Bank or branches thereof or
with any bank named as Security Safekeeper.at (d) above and located
in a city designated as a reserve city by the Board of Governors of
the Federal Reserve System, or with, the Federal Home Loan Bank of San
Francisco.
S. Depository's Rights. Depository has and reserves, as to all
securities used as security for deposits under this contract, the
right to: (a) add, substitute and withdraw them as provided in
California Government Code Section 53654, :provided the requirements
of paragraph 5 above are met; and (b) collect the interest thereon,
except in cases when they are liable to sale or are sold or converted
in accordance with California Government Code Section 53665.
9. Expense. Unless otherwise agreed in writing by Treasurer and
Depository, the ,(a) transportation of money deposited under this
contract to and from Depository, (b) the transportation of securities
maintained as security to and from the Agent °of Depository; and (c)
the handling, collecting and paying of all checks, drafts and other
exchange on funds deposited under this contract, shall be without
cost to Depositor. Depository shall pay for any charges for the
handling and safekeeping of securities hereunder.
10. Contract Termination. This contract is effective as of this
date, governs all deposits made by Treasurer with Depository on or
after the date hereof, and as to such deposits, cancels and
supersedes any previous like contracts between Treasurer and
Depository for the deposit of moneys. Either party, upon 30 days'
written notice to the other, may terminate this contract as to future
deposits, but not the deposits then held hereunder.
This contract is signed in duplicate and made as of ,
19
(Name) By
(Signature) Title
Acting in official capacity
as By
(Treasurer, Finance Director, etc.)
of (Depositor) Tit
DEPOSITORY
VALENCIA NATIONAL BANK
WAIVER OF SECURITY
Valencia National Bank
23920 West Valencia Blvd.
Valencia, CA 91355
Gentlemen:
Pursuant to Section 53652 of the Local Agency Deposit
Security Law, a Treasurer may, at. his discretion, waive
security of such portions as are insured pursuant to Federal
law.
WHEREAS, deposits with Valencia National Bank are insured by
the Federal Deposit Insurance Corporation up to and including
$100,000.00 for public accounts; and
WHEREAS, it is to the• advantage. of Valencia National Bank to
increase the amount of its collateral available to secure the
deposits of public accounts, and in so doing, without
increasing risk of the deposits of such public accounts;
NOW THEREFORE, the authorized agent
a public institution, hereby agrees
required by Section 53652 of the
Security Law of Valencia National
Association, for up to $100,000'.00
described public institution. As
National Bank shall continue to main
to waive the security
Local Agency Deposit
Bank, the Depository
of the deposits of the
a condition, Valencia
min approved collateral
security for all deposits in excess of $100,000.00 per
Section 53652 of the Local Agency Deposit Security Law.
I an authorized to waive security in the sum of $100,000.00
for deposits held by Valencia National Bank.
Dated•
Local Agency
By:
Title•