Meeting_Body
FINANCE, BUDGET AND AUDIT COMMITTEE
JULY 17, 2019
Subject
SUBJECT: CUSTODIAL BANKING SERVICES
Action
ACTION: AWARD CONTRACT
Heading
RECOMMENDATION
Title
AUTHORIZE the Chief Executive Officer to award a five-year, firm fixed-unit rate Contract No. PS133590000 to US Bank N.A. for custodial banking services in an amount not to exceed $1,003,370 inclusive of two, one year options, effective October 1, 2019, subject to resolution of protest(s), if any.
Issue
ISSUE
The existing five-year banking custodial services contract with U.S. Bank Institutional Trust & Custody will expire on September 30, 2019.
Background
BACKGROUND
Metro's Investment Policy requires that securities purchased for the investment of operating funds and collateral be maintained in the trust department or the safekeeping department of an established bank. The Treasurer is also required to report compliance with the investment policy and provide performance returns for the investments in a quarterly report to the CEO and Board.
Discussion
DISCUSSION
As of March 31, 2019, Metro Operating funds held in custody at US Bank totaled $1.6 billion. Operating funds are the pool of revenue used to pay expenses such as salaries, fuel, project costs, and supplies. To comply with the mandated Investment Policy, Metro requires an external trust department to provide custodial services of operating funds, compliance reporting, and performance measurement services.
Determination_Of_Safety_Impact
DETERMINATION OF SAFETY IMPACT
Approval of this item will not impact the safety of our patrons or employees.
Financial_Impact
FINANCIAL IMPACT
Total proposed fees of $1,003,370 over five years are based on a firm fixed rate applied to estimated market value of assets under custody, the number of transactions applied to a unit price, and the number of accounts subject to compliance monitoring and performance reporting services. The fiscal year 2020 fee of $200,674 is included ...
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