R-1140 - 11/08/2011 - AGREEMENT - Resolutions Supporting DocumentsITEM 6.F. 1)
AGENDA ITEM
Regular Board of Trustees Meeting
of
November 8, 2011
SUBJECT: Banking Services Request for Proposals
FROM: Sharon Dangles, Finance Director
BUDGET SOURCE/BUDGET IMPACT: Program 211 - Financial Services Management,
Program 811 -Sports Core General Operations, Program 831 -Golf Club General Operations
RECOMMENDED MOTION: I move that the Village Board award a Banking Services
Agreement, subject to attorney and staff review, for a three year contract with two (2)
option years for banking services, credit card processing, and lock box services with Chase
Bank, 2122 W. 22 °d Street, Oak Brook, Illinois. Additionally, the Village Board adopts
resolution 2011- AG -FI -R -1140, approving and authorizing the execution of an agreement
in relation to banking services by and between the Village of Oak Brook and Chase Bank.
Background/History:
In 2006, as a result of a competitive request for proposal process, the Village Board entered into
a contract with MB Financial Bank (formerly Oak Brook Bank) for banking services and credit
card processing. The initial contract was for three years, with the Village electing two
subsequent option years as a result of satisfactory performance by the bank. Due to the
expiration of the five year agreement originally contemplated, the Village Board authorized
issuance of a request for proposal for banking services.
The request for proposal was structured in four major areas: Banking Services, Lock Box
Services, Credit Card Processing, and Custodial Services. A total of nine proposals were
received for the various services outlined in the RFP. Staff performed a detailed analysis of the
cost of each proposal and conducted oral interviews with Chase Bank, U.S. Bank and MB
Financial Bank. Chase Bank and U.S. Bank came in very close offering the Village their best
price, but Chase ranked number one as the lowest bidder for combined services. The following
is our evaluation of each major area of the RFP.
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Banking Services
This section of the RFP consists of two parts: (1) the menu of charges associated with banking
services (clearing checks, account maintenance, ACH and deposit processing, etc.) and (2) the
amount of earnings credit on the Village's balances. Using an average month of services, the
cost of banking services with Chase Bank is estimated at $268.63 (net of earnings credit), which
ranked first when compared with the other proposers. As it relates to the earnings credit on the
Village's balances, the proposed rate is the managed rate (currently .25 %) plus .40% for a total
rate of .65 %. In addition, Chase Bank has offered the Village $500.00 in banking supplies such
as stamps, deposit slips, money bags, etc. to be used in the first 90 days.
Credit Card Processing
This section of the RFP consists of transaction costs and the discount rate for accepting credit
cards at the Oak Brook Sports Core. The cost of this service is significant to the Sports Core
operations as in 2010 the total cost for accepting credit cards was approximately $30,830.
The proposal from Chase Bank ranked fifth based on our analysis and would amount to a
reduction of approximately 15% from the average monthly costs we are currently paying. Many
credit card processing institutions outsource to third parties. Bankcard transactions will be
processed by Chase Paymentech, a wholly owned subsidiary of the Bank with separate
management and business policies.
Lockbox Services
The Village utilizes lockbox services for customer's water payments. This section of the RFP is
based on the average volume that the bank's used to quote us with rates they would charge to the
Village. Chase Bank ranked first when compared to the other proposers.
Custody Services
This service is optional and used for the custody and safekeeping of the Village's investments
(the pension fund investments are handled separately from this service). The Village is currently
not utilizing this service with our current bank. Only six of the banks submitted pricing for this
part of the proposal which is noted on the analysis.
Overall Proposal Recommendation
Over the three year contract, the Village will save approximately $40,000 with Chase Banking
Services compared to the Village's current contract with MB Financial Bank. Chase Bank is a
leading global financial services firm with assets of $2.1 trillion. Chase Bank is committed on
providing its banking services to allow the Village to conduct its business operations in a more
effective and economic way. For ease of transition, having one bank for all services would
reduce the amount of time spent by staff having to initiate transactions as well as bookkeeping
costs would be reduced, etc.
Please let me know if you have any comments or questions.
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RESOLUTION 2011 -AG-FI-R-1 140
A RESOLUTION APPROVING AND AUTHORIZING
THE EXECUTION OF AN AGREEMENT BY AND BETWEEN
THE VILLAGE OF OAK BROOK AND CHASE BANK
TO PROVIDE BANKING AND OTHER FINANCIAL SERVICES
WHEREAS, the Village's current contract for the provision of providing banking services and
other services currently expires December 31, 2011; and
WHEREAS, the Village solicited proposals for Banking Services; and
WHEREAS, the Village received nine proposals in response to its request for proposals for
Banking Services; and
WHEREAS, Chase Bank ( "Chase ") submitted the best overall proposal for Banking Services; and
WHEREAS, the Village and Chase desire to enter into and execute a Professional Services
Agreement for Chase to provide Banking Services ( "Agreement "); and
WHEREAS, the President and Board of Trustees have determined that it is in the best interests of
the Village to enter into the Agreement in a final form as approved by the Village Attorney;
NOW THEREFORE, BE IT RESOLVED BY THE PRESIDENT AND BOARD OF TRUSTEES OF
THE VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows:
Section 1: Recitals. The foregoing recitals are hereby incorporated into, and made a part
of, this Resolution as the findings of the President and Board of Trustees of the Village of Oak Brook.
Section 2: Approval of the Agreement. The President and Board of Trustees hereby
approve the Agreement by and between the Village and Chase Bank in a form acceptable to the Village
Manager and the Village Attorney.
Section 3: Authorization and Execution of the Agreement. The Village President and Village
Clerk shall be, and hereby are, authorized to execute the final Agreement on behalf of the Village.
Section 4: Effective Date. This Resolution shall be in full force and effect upon passage and
approval in the manner provided by law.
APPROVED THIS St" day of November, 2011
Gopal G. Lalmalani
Village President
Ayes:
PASSED THIS 81" day of November, 2011
ATTEST:
Charlotte K. Pruss
Village Clerk
Resolution 2011 -AG-FI-R-1 140
Banking Services Agreement
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