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REPORT <br />To the Honorable Mayor and City Council <br />From the City Manager <br /> <br />August 24, 2015 <br />SUBJECT <br />Banking and Cash Management Services Agreement <br /> <br />RECOMMENDATION <br />By motion, approve and authorize the City Manager to execute a one-year agreement <br />with Wells Fargo Bank in the amount of $90,000 for the provision of banking and cash <br />management services, and authorize the City Manager to renew the agreement for an <br />additional one-year term not to exceed $90,000. <br /> <br />BACKGROUND <br />The City entered into a four-year agreement with Wells Fargo Bank in 2008, with the <br />option of two one-year extensions at the same cost, for the provision of certain banking <br />and cash management services. These services include: daily cash balance reporting, <br />controlled disbursement, positive pay, fraud prevention, automatic deposit for payroll, <br />automated clearing house transactions, lockbox, wire transfer initiations, check <br />issuance, and depository services. <br />ANALYSIS <br />While staff has been satisfied with the services provided by Wells Fargo, it is <br />appropriate at this point in time to conduct a competitive Request for Proposal (RFP) <br />process to ensure that the City is receiving the best and most cost-effective services to <br />meet our banking needs. Since the term of the current banking services agreement has <br />expired, staff recommends entering into a new one-year agreement with Wells Fargo. <br />This will better ensure continuity in essential banking services, at the same cost as <br />current services, during the time it takes to conduct the RFP process. Staff will complete <br />this process in an expeditious manner, bringing forward a new competitively procured <br />and negotiated banking services agreement as soon as possible. <br />ALTERNATIVES <br />The Council may direct staff to continue with Wells Fargo without the additional <br />protections provided by an agreement during the period of time required to undertake a <br />competitive process for the procurement of banking services. <br />FISCAL IMPACT <br />The City currently spends approximately $80,000 a year for banking and cash <br />management fees, paid either by maintaining non-interest bearing deposits <br />(compensating balances) or by direct payment. <br /> <br />6.1.D. - Page 1