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AGENDA ITEM 3A STAFF ORIGNINATOR: Al Rolek MEETING DATE: July 23, 2001 TOPIC: Consider Resolution 01-109 Accepting Banking Proposal VOTE REQUIRED: 3/5 BACKGROUND: For some time it has been the intent of staff, at the direction of the City Council, to evaluate the banking opportunities in the City. The purpose of this evaluation is to establish a banking relationship with the institution which best fits the banking needs of the City. In May of this year staff mailed Requests for Proposals for Banking Services (RFP) to each bank within the City, Firstar Bank, Community National Bank and Lino Lakes State Bank. The City received responses from each of these institutions. Upon comparing and evaluating the responses, staff found that all banks met the basic criteria and had the ability to deliver the services requested in the RFP. Two of the institutions, Lino Lakes State Bank and Community State Bank, offered the best package of services and costs and were virtually identical in this regard. Other criteria of a more intangible nature, such as customer service orientation, community involvement, etc., were also considered in the evaluation. Again, both institutions have a high emphasis on customer relations and are involved in community events and service. At present the City maintains one checking account, which is quite adequate for our needs. It has been suggested that perhaps the City could split its accounts between the institutions. While this may sound like a good solution on the surface it would result in twice the time and work the staff would have to dedicate to this area in terms of record keeping, reconciliations, etc. A better solution might be to consider the institutions not designated as the depository for outside financing, negotiated notes and special needs the City would have from time to time. This would afford them the opportunity to participate in the City's overall financial goals. In addition, the City will revisit the RFP process in three years, at which time it is anticipated that all banks will be again invited to submit proposals. Given these factors and the results of the RFP, staff recommends that the City Council adopt Resolution No. 109-01 accepting the proposal from Lino Lakes State Bank for banking services for a three-year term extending through December 31, 2004. Should you have any questions relative to this matter, please feel free to call me at your discretion. OPTIONS: 1. Adopt Resolution No. 01-109 2. Deny Resolution No. 01-109 3. Return to Staff for further review. RECOMMENDATIONS: Option 1.