AGENDA REPORT · Development as a condition of the City's 2014 North Industrial Park/Utility Infrastructure Extension water and sewer bond issuance to create the new banking accounts

AGENDA REPORT

To: Mayor Pat Humphrey and the Clare City Commission

From: Steven J. Kingsbury, MBA, CPFA, MiCPT

Treasurer, Finance Director and

Director of Information Technology

Date: April 16, 2015

Regarding: Approval of the establishment of new bank accounts and review/re-approval

of the signatories of the City's Bank Accounts.

For the Agenda of April 20, 2015

________________________________________________________________________

Background As a part of the financing provided by Rural Development by their

purchase of the water and sewer revenue bonds issued by the City of Clare for the 2014

North Industrial Park/Utility Infrastructure Extension four new bank accounts are

required to be established as identified within City of Clare Ordinances 2014-004 and

2014-005 approved by the City Commission on August 18, 2014 (copies enclosed).

Two of the bank accounts to be created are the Bond and Interest Redemption Accounts

(one for the sewer bond and one for the water bond) which is used to for the required

payment reserve which is funded over a ten year period.

The other two bank accounts required to be established are for repairs, replacement and

improvements to the sanitary sewer system and the water system during the forty year

terms of the Rural Development loans. For these two accounts an amount predetermined

by Rural Development based upon the original amount of the bond is required to be put

into reserve to pay for repairs and replacements to what is called short lived assets (less

expensive components of the system) and other improvements needed to maintain the

water and sewer systems. Funds put into this account can be used immediately or in the

future for the types of maintenance and improvement purposes identified on pages 13 and

14 for the water bond ordinance and pages 14 and 15 of the sewer bond ordinance.

The required Bond Payment Reserve and the Repair, Replacement and Improvement

Reserve schedules for both the water revenue bond and the sewer revenue bond are

enclosed for the City Commissions reference.

In addition to establishing these four new bank accounts a complete review of all of the

City’s bank accounts has been completed and is summarized for the Commission’s

review on the attached spreadsheet. The City Commission is asked to approve the list of

signatories and re-designate Steven Kingsbury as the City’s Investment Officer and

Electronic Banking Administrator.

2

Issues & Questions Specified Should the City Commission approve the creation of the

four new bank accounts, the list of bank signatories and also re-designate Steven

Kingsbury as the City’s Investment Officer and Electronic Banking Administrator?

Alternatives

1. Approve the creation of the four new accounts, updated bank account signatories

and banking administrative appointments.

2. Direct that changes be made.

3. Do not approve the new accounts, the list of signatories or appointments.

4. Defer/delay decision of these matters to a subsequently scheduled City

Commission meeting.

Financial Impact There is no direct financial impact, however, it is required by Rural

Development as a condition of the City's 2014 North Industrial Park/Utility Infrastructure

Extension water and sewer bond issuance to create the new banking accounts. It is also

prudent to review and update the authorized signatories on a periodic basis to ensure our

ability to continue conducting the City’s banking business.

Recommendation Management recommends that the City Commission approve the

creation of the four new bank accounts, to approve the list of individuals authorized as bank

account signatories and also to re-designate Steven Kingsbury as the City’s Investment

Officer and Electronic Banking Administrator by adoption of Resolution 2015-037.

Attachments

1. City of Clare Ordinance 2014-004.

2. City of Clare Ordinance 2014-005.

3. Bank Account Listing.

4. 2014 Water and Sewer Revenue Bond Reserve Schedules.

5. Resolution 2015-037.

BANK ACCOUNT TYPE ACCOUNT TITLE SIGNATORIES

Chemical Bank Municipal NOW Checking Consolidated Fund Steven J. KingsburyDiane M. LyonSarah SchumacherMichelle Bott

Chemical Bank Municipal Checking ACH Receipt Acct Steven J. KingsburyDiane M. LyonSarah SchumacherMichelle Bott

Chemical Bank Municipal Checking 2014 Water and Sewer Steven J. KingsburyRevenue Bond Diane M. Lyon

Four New Bank Accounts Reserve Accounts Sarah SchumacherMichelle Bott

Chemical Bank Repurchase Agreements Consolidated Fund Steven J. Kingsbury (Term Investments) Ken Hibl - Alternate

Chemical Bank Municipal NOW Checking Tax Fund Steven J. KingsburyDiane M. LyonSarah SchumacherMichelle Bott

Chemical Bank Municipal NOW Checking DDA Fund James A. AllenKen A. HiblSteven J. KingsburyMichelle Bott

Chemical Bank Municipal NOW Checking LDFA Fund Jeffrey J. KlausKen A HiblSteven J. KingsburyMichelle Bott

First Bank Money Market Gold Account Consolidated Fund Steven J. KingsburyDiane M. LyonSarah SchumacherMichelle Bott

SIGNATORY AUTHORITY AS OFApril 20, 2015

CITY OF CLAREBANK ACCOUNT LISTING AND

Page 1 of 2

FISCAL YEAR TOTALAnnual

ContributionAccumulated

BalanceAnnual

ContributionAccumulatedContributions

FY2014/15 1 5,101.50$ 1,875.00$ 1,875.00$ 3,226.50$ 3,226.50$ FY2015/16 6,802.00 2,500.00 4,375.00 4,302.00 7,528.50 FY2017/18 6,802.00 2,500.00 6,875.00 4,302.00 11,830.50 FY2018/19 6,802.00 2,500.00 9,375.00 4,302.00 16,132.50 FY2019/20 6,802.00 2,500.00 11,875.00 4,302.00 20,434.50 FY2020/21 6,802.00 2,500.00 14,375.00 4,302.00 24,736.50 FY2021/22 6,802.00 2,500.00 16,875.00 4,302.00 29,038.50 FY2022/23 6,802.00 2,500.00 19,375.00 4,302.00 33,340.50 FY2024/25 6,802.00 2,500.00 21,875.00 4,302.00 37,642.50 FY2025/26 6,802.00 2,500.00 24,375.00 4,302.00 41,944.50 FY2026/27 6,802.00 625.00 25,000.00 6,177.00 48,121.50

FY2027/28 6,802.00 6,802.00 54,923.50 FY2028/29 6,802.00 6,802.00 61,725.50 FY2029/30 6,802.00 6,802.00 68,527.50 FY2030/31 6,802.00 6,802.00 75,329.50 FY2031/32 6,802.00 6,802.00 82,131.50 FY2032/33 6,802.00 6,802.00 88,933.50 FY2033/34 6,802.00 6,802.00 95,735.50 FY2034/35 6,802.00 6,802.00 102,537.50 FY2035/36 6,802.00 6,802.00 109,339.50 FY2036/37 6,802.00 6,802.00 116,141.50 FY2037/38 6,802.00 6,802.00 122,943.50 FY2038/39 6,802.00 6,802.00 129,745.50 FY2039/40 6,802.00 6,802.00 136,547.50 FY2040/41 6,802.00 6,802.00 143,349.50 FY2041/42 6,802.00 6,802.00 150,151.50 FY2042/43 6,802.00 6,802.00 156,953.50 FY2043/44 6,802.00 6,802.00 163,755.50 FY2044/45 6,802.00 6,802.00 170,557.50 FY2045/46 6,802.00 6,802.00 177,359.50

Bank Account Number Bank Account Number

CITY OF CLARE2014 NORTH INDUSTRIAL PARK

WATER SYSTEM INFASTRUCTURE EXTENSION CAPITAL IMPROVEMENT PROJECTUSDA - RURAL DEVELOPMENT BOND RESERVES

Repair, ReplacementBond Payment Reserve and Improvement

Page 2 of 2



BalanceAnnual


Bank Account Number Bank Account Number


WATER SYSTEM INFASTRUCTURE EXTENSION CAPITAL IMPROVEMENT PROJECTUSDA - RURAL DEVELOPMENT BOND RESERVES

Repair, ReplacementBond Payment Reserve and Improvement

FY2046/47 6,802.00 6,802.00 184,161.50 FY2047/48 6,802.00 6,802.00 190,963.50 FY2048/49 6,802.00 6,802.00 197,765.50 FY2049/50 6,802.00 6,802.00 204,567.50 FY2050/51 6,802.00 6,802.00 211,369.50 FY2051/52 6,802.00 6,802.00 218,171.50 FY2052/53 6,802.00 6,802.00 224,973.50 FY2053/54 1,700.50 1,700.50 226,674.00

Totals 251,674.00$ 25,000.00$ 226,674.00$

Notes:

1 - The USDA bond reserve requirement begins October 1, 2014 so the FY2014/15 Reserve Requirement is only for three quarters.

Page 1 of 2



BalanceAnnual


FY2014/15 1 4,652.25$ 1,125.00$ 1,125.00$ 3,527.25$ 3,527.25$ FY2015/16 6,203.00 1,500.00 2,625.00 4,703.00 8,230.25 FY2017/18 6,203.00 1,500.00 4,125.00 4,703.00 12,933.25 FY2018/19 6,203.00 1,500.00 5,625.00 4,703.00 17,636.25 FY2019/20 6,203.00 1,500.00 7,125.00 4,703.00 22,339.25 FY2020/21 6,203.00 1,500.00 8,625.00 4,703.00 27,042.25 FY2021/22 6,203.00 1,500.00 10,125.00 4,703.00 31,745.25 FY2022/23 6,203.00 1,500.00 11,625.00 4,703.00 36,448.25 FY2024/25 6,203.00 1,500.00 13,125.00 4,703.00 41,151.25 FY2025/26 6,203.00 1,500.00 14,625.00 4,703.00 45,854.25 FY2026/27 6,203.00 375.00 15,000.00 5,828.00 51,682.25

FY2027/28 6,203.00 6,203.00 57,885.25 FY2028/29 6,203.00 6,203.00 64,088.25 FY2029/30 6,203.00 6,203.00 70,291.25 FY2030/31 6,203.00 6,203.00 76,494.25 FY2031/32 6,203.00 6,203.00 82,697.25 FY2032/33 6,203.00 6,203.00 88,900.25 FY2033/34 6,203.00 6,203.00 95,103.25 FY2034/35 6,203.00 6,203.00 101,306.25 FY2035/36 6,203.00 6,203.00 107,509.25 FY2036/37 6,203.00 6,203.00 113,712.25 FY2037/38 6,203.00 6,203.00 119,915.25 FY2038/39 6,203.00 6,203.00 126,118.25 FY2039/40 6,203.00 6,203.00 132,321.25 FY2040/41 6,203.00 6,203.00 138,524.25 FY2041/42 6,203.00 6,203.00 144,727.25 FY2042/43 6,203.00 6,203.00 150,930.25 FY2043/44 6,203.00 6,203.00 157,133.25 FY2044/45 6,203.00 6,203.00 163,336.25 FY2045/46 6,203.00 6,203.00 169,539.25


USDA - RURAL DEVELOPMENT BOND RESERVESSEWER SYSTEM INFASTRUCTURE EXTENSION CAPITAL IMPROVEMENT PROJECT

Bank Account Number Bank Account NumberBond Payment Reserve

Repair, Replacementand Improvement

Page 2 of 2



BalanceAnnual



USDA - RURAL DEVELOPMENT BOND RESERVESSEWER SYSTEM INFASTRUCTURE EXTENSION CAPITAL IMPROVEMENT PROJECT

Bank Account Number Bank Account NumberBond Payment Reserve

Repair, Replacementand Improvement

FY2046/47 6,203.00 6,203.00 175,742.25 FY2047/48 6,203.00 6,203.00 181,945.25 FY2048/49 6,203.00 6,203.00 188,148.25 FY2049/50 6,203.00 6,203.00 194,351.25 FY2050/51 6,203.00 6,203.00 200,554.25 FY2051/52 6,203.00 6,203.00 206,757.25 FY2052/53 6,203.00 6,203.00 212,960.25 FY2053/54 1,550.75 1,550.75 214,511.00

Totals 229,511.00$ 15,000.00$ 214,511.00$

Notes:

1 - The USDA bond reserve requirement begins October 1, 2014 so the FY2014/15 Reserve Requirement is only for three quarters.

RESOLUTION 2015-037 A RESOLUTION OF THE CLARE CITY COMMISSION APPROVING THE CREATION OF FOUR NEW BANK ACCOUNTS, AUTHORIZING BANK SIGNATORIES AND THE REAPPOINTMENT OF THE CITY’S INVESTMENT OFFICER AND ELECTRONIC BANKING ADMINISTRATOR. WHEREAS, the City of Clare maintains a number of bank accounts to conduct its daily business, all of said accounts requiring signatories approved by the City Commission; and WHEREAS, to ensure the efficient management of said accounts, it is deemed prudent from time to time to review the necessity of said accounts and to add or eliminate any accounts as appropriate; and WHEREAS, the banks holding said accounts of the City require a formal, approved list of signatories; and WHEREAS, as part of the City's 2014 North Industrial Park/Utility System Infrastructure Extension project which is partially funded through the purchase of water and sewer system revenue bonds by Rural Development separate bank accounts are required to segregate and separately account for certain reserve funds related to the project; and WHEREAS, the City Commission is the approval authority for all signatories of all City bank accounts and the decision authority in respect to the elimination and establishment of any said accounts. NOW THEREFORE BE IT FURTHER RESOLVED THAT the City Commission of the City of Clare hereby approves the list of bank accounts and authorized signatories by account title, said accounts and signatories as listed on the attachment to this Resolution, said approval being valid effective this date and to remain effective until further amended, rescinded and/or approved by the Clare City Commission. BE IT FURTHER RESOLVED THAT the City Commission of the City of Clare hereby reappoints Steven J. Kingsbury, City Treasurer, Finance and Technology Director, as the City's Investment Officer and also as it's Administrator of the Electronic Banking systems which are used by the City to affect the payment of federal and state withholding taxes and other electronic banking transactions. BE IT FURTHER RESOLVED THAT the City Treasurer shall be responsible for maintaining the accuracy and current need of said list and shall provide recommendations to the City Commission whenever there is a need to change the list of approved signatories or when it is deemed necessary to establish or eliminate a specific bank account of the City.

ALL RESOLUTIONS AND PARTS OF RESOLUTIONS INSOFAR AS THEY CONFLICT WITH THE PROVISIONS OF THIS RESOLUTION BE AND THE SAME ARE HEREBY RESCINDED. The Resolution was introduced by Commissioner and supported by Commissioner . The Resolution declared adopted by the following roll call vote: YEAS: NAYS: ABSENT: Resolution approved for adoption on this 20th

day of April 2015.

_______________________________ Diane Lyon, City Clerk

Documents

AGENDA REPORT · Development as a condition of the City's 2014 North Industrial Park/Utility Infrastructure Extension water and sewer bond issuance to create the new banking accounts