To: MAYOR AND CITY COUNCIL
From: EUGENE SOLOMON, CITY TREASURER
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APPROVE THE THIRD AMENDMENT TO THE AGREEMENT FOR PROFESSIONAL SERVICES BETWEEN THE CITY OF REDONDO BEACH AND BANK OF AMERICA, N.A., EXTENDING THE TERM THROUGH MAY 31, 2027 WITH AN OPTION TO RENEW FOR ONE ADDITIONAL YEAR AND AUTHORIZE THE MAYOR TO EXECUTE THE AGREEMENT ON BEHALF OF THE CITY
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EXECUTIVE SUMMARY
To ensure the continued provision of high quality, competitively priced, general banking services to the City, staff recommends approval of the third amendment to the Agreement for Professional Services with Bank of America, N.A. (Bank of America).
Performance goals and objectives for the City Treasurer include implementation of banking services technology designed to streamline disbursement processes, automate cash management processes, enhance fraud prevention measures, and enhance collection efforts. The planning and implementation of banking service enhancements and technologies will serve to boost Citywide operational efficiency and productivity with respect to the City's interaction with the public and City Departments, including the Department of Financial Services, Department of Information Technology, Office of the City Treasurer, and the Office of the City Clerk.
Approval of the Agreement will extend the provision of general banking services by Bank of America for a one-year term at a fixed fee, running through May 31, 2027, with options to renew for a single, one-year term. The Bank has agreed to an Earnings Credit Rate (ECR) of 2.15%.
This proposed third amendment sets the rate of interest earned on applicable accounts to 2.35%. Estimated real interest earnings in the coming fiscal year from the Agreement should exceed $100,000 of new revenue.
By choosing to continue its current business relationship with Bank of America, the City will also realize significant efficiencies in service, technology, operating costs, and banking fees.
BACKGROUND
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