Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM
Item No.
6g
ACTION ITEM
Date of Meeting
July 28, 2020
DATE: June 22, 2020
TO: Stephen P. Metruck, Executive Director
FROM: Diane Campbell, Treasury Manager
Dan Thomas, Chief Financial Officer
SUBJECT: Banking Services Contract
Estimated request amount:
$750,000
ACTION REQUESTED
Request authorization for the Executive Director to extend current Banking Services Contract Term for
up to 12 months, and approve additional funding of up to $750,000, if needed.
EXECUTIVE SUMMARY
The request to extend the contract is to accommodate a delayed procurement that was paused due to
disruptions to Port businesses and changes in the economy resulting from the COVID-19 pandemic.
DETAILS
The Commission authorized a new banking services procurement in June 2019 in anticipation of the
expiration of the current banking services contracts on July 31, 2021. The procurement consists of four
separate contracts and requires a cross-department team from Finance, Accounting, Information
Technology and key businesses. The requests for proposals (RFPs) were drafted and prepared for
release starting in February 2020. In early March, the crisis from the evolving COVID-19 pandemic and
the stay home order resulted in considerable volatility and uncertainty, including the Port’ banking
activities. For example, credit card transactions at the Airport parking garage fell, the Port’s emergency
treasury procedures were implemented, and Port staff work abruptly shifted from on-site to working
remotely. At the same time, banks were overwhelmed with assisting customers adapting to remote
transactions processing. Members of the Port’s banking services procurement team paused the
procurements until more stable conditions returned. This decision was supported in the April 2020
Government Finance Officers Association (GFOA) “Maintaining Treasury Operations During COVID-19”
research publication that outlined “strategies that governments should consider regarding their
treasury operations during the crisis” - one strategy “now is not the time to change banking
relationships.” There are multiple reasons, including the disruptions in the banking industry, shifts in
people and services resources, and mitigating risks from working and banking in remote environments.
In June 2020, the procurement team regrouped, and taking into consideration that the level of
uncertainty for businesses and the economy continued to be high, drafted a revised procurement
schedule to resume in the first quarter of 2021. The basis of the RFPs will remain the same, including
COMMISSION AGENDA – Action Item No. 6g Page 2 of 2
Meeting Date: July 28, 2020
Template revised September 22, 2016; format updates October 19, 2016.
requirements of long-term equitable financial education, literacy and empowerment in the banking
services scope of work. The revised schedule has several benefits: the RFPs can include additional
questions staff has learned regarding contingency planning, and banks will no longer be in crisis
management mode and can better respond to the RFPs. However, the revised schedule pushes the
transition period beyond the current banking contract end date, July 31, 2021. The additional time
needed depends on the outcomes of the procurements and the state of recovery from the COVID-19
situation. Extending the contract provides flexibility to complete the delayed procurement. The
additional funding estimate varies being dependent on the level of banking transactions and fees from
June 2020 over the coming months as the Port’s businesses and banking activities recover from the
effects of the COVID-19 pandemic, and the time needed to transition to the selected provider(s).
FINANCIAL IMPLICATIONS
Current Contract:
Cost Estimate/Authorization Summary
Expense
Total
COST ESTIMATE
Original authorization
$9.7 million
$9.7 million
AUTHORIZATION
Additional authorizations
$5.0 million
$5.0 million
Current request for authorization
$0.75 million
$0.75 million
Total authorizations, including this request
$15.45 million
$15.45 million
Remaining amount to be authorized
$0
$0
Annual Budget Status and Source of Funds
Fees are budgeted annually and allocated to operating divisions based on usage.
ATTACHMENTS TO THIS REQUEST
None
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
Current banking contracts:
August 6, 2013 – Commission authorized the CEO to execute a contract for banking services for five
years with the option to extend for two additional one-year periods at an estimated cost in
banking fees of $9,700,000.
February 26, 2019 – Commission authorized the Executive Director to increase the amount of the
Port’s existing banking services contract by an additional $5,000,000 (from $9,700,000 to
$14,700,000) to accommodate higher transactions volume and fees than were estimated in
2013.
New banking contracts:
June 25,2019 - Commission authorized the Executive Director to execute new contracts for banking
services for estimated contract amount of $48,200,000 over ten years
