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PR 23069: APPROVAL OF CONTRACT FOR DEPOSITORY SERVICES
City of r rthu � Thlus www.PortArthurTx.gov INTEROFFICE MEMORANDUM Date: 03/21/2023 To: The Honorable Mayor and City Council Through: Ron Burton, City Manager From: Kandy Daniel, Director of Finance RE: PR No. 23069 - Approval of Contract for Depository Services Introduction: The intent of this Agenda Item is to seek City Council's approval to designate PNC Bank, National Association as the primary depository for the City of Port Arthur for the period of April 1,2023 through March 31, 2025 with a provision for three one-year extensions under the same terms and conditions of the contract. Background: Pursuant to Chapter 105 of the Local Government Code, the city is required to solicit proposals for banking services at least every five years. On March 20,2023,the City received only one(1)application from the following bank: PNC Bank,National Association. The application was evaluated based on,but not limited to,the following criteria: 1. Ability to perform and provide the required and requested services; 2. Reputation of applicant and quality of services; 3. Cost of services; 4. Funds availability; 5. Interest paid on interest bearing accounts and deposits; 6. Earnings credit calculation of account balances; 7. Completeness of application and agreement to points outlined in the RFA; 8. Convenience of locations; 9. Previous service relationship with the City; and 10. Financial strength and stability of institution PNC Bank,National Association met all criteria,terms and conditions required by the City of Port Arthur. "Remember,we are here to serve the Citizens of Port Arthur" P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743 Clh'o/ o1-t rtht www.PortArthurTx.gov Budget Impact: The City intends to pay for banking services through the earnings credit amount generated by bank balances which is deducted from interest earnings each month. There is no direct impact on the budget. Recommendation: It is recommended that City Council approve to designate PNC Bank,National Association as the primary depository for the City of Port Arthur for the period beginning April 1, 2023 through March 31,2025. "Remember,we are here to serve the Citizens of Port Arthur" P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743 P.R. 23069 KD 03/21/2023 RESOLUTION NO. A RESOLUTION OF THE CITY OF PORT ARTHUR, TEXAS, DESIGNATING A PRIMARY BANK DEPOSITORY AND AUTHORIZING THE CITY MANAGER TO SIGN AND EXECUTE A BANK DEPOSITORY SERVICES AGREEMENT WITH PNC BANK, NATIONAL ASSOCIATION AND TO AUTHORIZE THE DIRECTOR OF FINANCE AND CITY SECRETARY TO EXECUTE ALL DOCUMENTS NECESSARY TO IMPLEMENT THE CONTRACT TO BE EFFECTIVE APRIL 1, 2023. WHEREAS, pursuant to Chapter 105 of the Texas Local Government Code,the governing body of a municipality must utilize depository services for the receipt and disbursement of public funds. The establishment of a primary bank depository is also governed by Chapter 2256 (public Funds Investment Act) and 2257 (Public Funds Collateral Act) of the Texas Government Code, and the City of Port Arthur's Investment and Purchasing Polices; and, WHEREAS, the City's current bank depository has reached the end of its term and it is necessary to obtain these services in accordance with Chapter 105 of the Texas Local Government Code; and WHEREAS, in order to comply with the bank depository application process as provided in the above-referenced statutes, the City of Port Arthur solicited a Request for Applications ("RFA") and advertised in the Port Arthur News on February 25, 2023 and March 4, 2023 and followed all of the remaining prerequisites as set forth in 105.012 of the Texas Local Government Code. and, WHEREAS, the City of Port Arthur, Texas ("City") received one (1) application in the manner required by state law for depository services on Monday, March 20, 2023;and, WHEREAS, the City Council has been furnished a copy of the recap of the responding bank's application, PNC Bank,National Association which is attached hereto as Exhibit"A" and made a part hereof for all purposes; and, WHEREAS, it has been determined that the application submitted by PNC Bank,National Association met all criteria, terms and conditions required for the handling of the City's funds; now therefore; BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR: Section 1. The facts and opinions in the preamble are true and correct. Section 2. The City does hereby designate PNC Bank,National Association as the Primary Depository of the City. Section 3. The PNC Bank,National Association application as recapped in Exhibit "A" is accepted, with the new depository contract commencing on April 1, 2023. Section 4. The City Manager is hereby authorized to execute a Depository Services Agreement with PNC Bank,National Association, according to the terms of their application. Section 5.The Director of Finance,along with the City Secretary when necessary,is hereby authorized to execute all documents to implement the services set forth in the agreement on behalf of the City. Section 6. The initial agreement is for two years,with the City having the option to extend the agreement for three additional one-year periods, under the same terms and conditions. Section 7. A copy of the caption of this Resolution shall be spread upon the Minutes of the City Council. READ, ADOPTED, AND APPROVED, this th day of March, 2023, AD, at a Regular Meeting of the City Council of the City of Port Arthur, Texas by the following vote: AYES: Mayor: Councilmembers: NOES: Thurman Bartie, Mayor ATTEST: Sherri Bellard, City Secretary APPROVED AS TO FORM: d Val Tizeno, City Attorne APPROVED FOR AVAILABILITY OF FUNDS: Kandy Daniel, Director of Finance APPROVED FOR ADMINISTRATION: Ron Burton, City Manager EXHIBIT "A" e PN C „or ,..:. ...,,, , .7,... , ... ‘ -- .....,....„ _ . .._,.:::: .„,,f_._ . to, ,-,- , ,,,,,,,, .,. _ .,-, „. , , xs Q ,, . - wv Ry, C ., r 10 3 cy 1 s . n A, . ch i eveyourpriorities ' _,..„ , . ' r ' ' '_ ,,' W ith effective, reliable services Our proposal to deliver bank depository services to the City of Port Arthur RFA P23-029 Submitted on 3/20/2023 Prepared by: Michael Bradley Cindy Young Treasury Management Officer Relationship Manager 972-765-7292 713-499-8632 michael.bradley@pnc.com cindy.young@pnc.com Proposal to provide comprehensive banking services to the City of Port Arthur 3/20/2023 City of Port Arthur City Secretary PO Box 1089 Port Arthur, Texas 77641-1089 Dear Kandy, PNC Bank is excited to submit our response for the City of Port Arthur"City's" RFA. We maintain a genuine desire to play a lead role in assisting the City transform its banking and treasury management solutions to further your vision and goals. Throughout our response, we highlight the PNC difference, including the consistent development of new technology, our commitment to solid and reliable service and a genuine relationship approach that seeks to provide solutions across the spectrum of treasury services, capital financing and liquidity management. Our goal with any relationship is not to become your vendor, but to be a consultant. We want to be the trusted financial advisor that will assist in creating operational efficiencies while strengthening your economic viability. Among the most important differentiators of this proposal: • Local Presence-a Texas relationship team with knowledge of the government sector, insight and decision-making capability • Solutions Provider-Delivering value-add solutions and bringing deep knowledge and transaction expertise for your sector • Execution Capabilities-Delivering superior services, premier experience, and transaction execution • PNC's Financial Strength-Founded in 1875, PNC has long track record of strong performance We would welcome the opportunity to expand our relationship with the City and serve as your banking partner. As part of your evaluation process, we would be pleased to present our proposal in person and provide a demonstration of our products and solutions. Please do not hesitate to contact us with any questions. Sincerely, ,eejetL Michael Bradley Cindy Young Treasury Management Officer Relationship Manager 972-765-7292 713-499-8632 michael.bradley@pnc.com cindy.young@pnc.com Proposal to provide comprehensive banking services to the City of Port Arthur Table of Contents Executive Summary 2 Our Answers to Your Questions 6 Bank Depository Services 6 Net Earnings 22 Collateral Requirements 24 Overdraft Provisions 26 Other Stipulations 27 Application Submitted By 30 Pricing 32 Appendices 40 Disclosures 44 This Proposal is delivered by PNC Bank,National Association("PNC")and is conditioned upon it being kept confidential,and not shown to or discussed with any third party,including any financial institution(other than on a confidential or need-to-know basis with the recipient's directors,officers,employees,counsel and other advisors,or as required by law),or used other than for the purpose of evaluating this Proposal,without PNC's prior written approval.This Proposal is not a contract,an offer to enter into a contract,a commitment to lend or an offer to lend and does not obligate either party to negotiate or enter into any contract in connection with the Services described in this Proposal.Any commitment to provide certain Services may be subject to credit approval and any binding agreement to accept or provide the Services will be subject to the parties entering into a written agreement that will contain terms that are acceptable to the parties. PNC reserves the right to change,alter,eliminate or withdraw all or portions of this Proposal for the Services or to choose not to provide some or all of the Services.The recipient is responsible for all costs associated with its evaluation and due diligence efforts to review this Proposal. Proposal to provide comprehensive banking services to the City of Port Arthur I� PN C O gig, t ' 4: a r t Executive Summary „ .,...._ ,,..,,:::- _,,„ r z s . ry, CITY OF PORT ARTHUR 111 Proposal to provide comprehensive banking services to the City of Port Arthur � PN C Executive Summary PNC offers a robust set of treasury management solutions and relationship experience to support the City of Port Arthur(the "City") need for daily bank depository services. The world of banking has changed, technology is shifting every day, and pricing structures are getting more competitive. We envision a relationship that promotes the City's goals of Culture, Service and Accountability through high quality banking services and a clear plan for future modernization of your treasury management services. The team has identified critical success factors to meet your expectations: The City's Goals: We'll deliver the following to help you achieve your goals: J Provide the services We have a local Texas team with the government experience requested by the City. you need to realize a seamless and successful transformation that will help enhance and create efficiencies as we know and understand the challenges of doing more with less staff. 2 Be willing, attentive and When you work with PNC, you'll gain a trusted advisor and responsive to the City's partner that will help you leverage industry-leading financial matters. technology, automate your processes resulting in reduced costs, and ensure that the City's funds are safe. 0 Be financially sound and Founded in 1875, PNC has a long track record of strong meet the City's requirements. performance and has the 6th largest balance sheet in the industry with over$550 billion in assets. Have a physical presence PNC has a local branch in Port Arthur located at 8150 within the City's boundaries. Memorial Blvd. Additionally, your Relationship Manager and Treasury Management Officer are in Texas. Relationship Management Team Your PNC team, led by Relationship Manager, Cindy Young, and Treasury Management Officer, Michael Bradley, brings a variety of banking and consulting experience, as does your Relationship Services Advisor-Michael Janociak. For the City, this streamlined relationship structure delivers greater responsiveness to your questions and concerns. Technology Innovation With the financial services industry seeing more change in the last five years than in the previous 20 years combined, keeping up to date on emerging technology is important. Enhancements such as faster payments, cloud computing and the rise of fintechs have become both a disrupter and enhancer in how we are working with our clients to help them digitally transform their treasury office. With PNC investing approximately 10.1% of our annual net revenue on technology, this enables us to keep focus on treasury trends in the industry, so you don't have to. PNC helps our clients along the path to digital transformation by leveraging our Treasury Management Platform. Regardless of your electronic resource planning (ERP) systems, PNC simplifies the way you conduct your treasury management business today. CITY OF PORT ARTHUR II Proposal to provide comprehensive banking services to the City of Port Arthur � `�-� Po PN Your PNC Team is eager to collaborate with you, in an effort to identify and address areas of challenge and recommend the most effective and efficient technology solutions to meet your goals, now and in the future. Increased Efficiency to Help Achieve Lower Costs PNC has included competitive fees and rates that demonstrate our commitment to you and will help you succeed well into the future. We are proposing an optimal mix of the City's deposits (balances) to offset fees, while providing an alternative investment solution (Money Market Demand Account Sweep)for any excess cash. We also understand it can be costly to change banking providers, so we are providing a waiver of fees for the first year of the contract, assuming a five-year contract. With respect to fees, we agree to hold our treasury management services unit pricing throughout the contract period. City of Port Arthur-Banking Proposal PNC Year 1 Year 2 Year 3 Year 4 Years Total Balances $ 10,000,000 Balances Needed to Offset Fees $ - $ 2,203,835 $ 2,203,835 $ 2,203,835 $ 2,203,835 Excess Balances into Sweep $ 10,000,000 $ 7,796,165 $ 7,796,165 $ 7,7'36,165 $ 7,796,165 Earnings Credit Rate 1.50% Acct Balance Fee 0.17% ($3,747) ($3,747) (53,747) ($3,747) ($14,986) Banking Fees (529,311) ($29,311) ($29,311) (529,311) ($29,311) ($146,555 Total Banking Fees ($29,311) (533,058) (533,058) (533,058) ($33,058) ($161,541) PNC 1st year Waiver $29,311 $ 29,311 Earnings Credit $ 33,058 $ 33,058 $ 33,058 $ 33,058 $ 132,230 Sweep Rate and Interest =>$10M 3.35% $ 335,000 $ 335,000 $2M-$10M 2.75% $ 214,395 $ 214,395 $ 214,395 $ 214,395 $ 857,578 Teaming with You for Success What sets us apart is our strategic dedication to delivering innovative solutions that empower you to thrive in the digital economy. We're leading the way with faster payments capabilities, improvements to our top- rated corporate online and mobile banking portal and new ways to mitigate the risk of fraud—and many more areas that can help you improve your treasury operations. When you choose PNC to help reimagine your bank depository strategy, you'll join forces with an innovative team driven to support your growth, and you'll benefit from: ■ Digital tools and services that make your life easier. Our culture of innovation enables us to deliver industry-specific solutions that anticipate, meet—and routinely exceed—market demands. Our drive to innovate helps you lower costs, transact faster, improve efficiencies, streamline processes and gain the real-time visibility needed to inform smarter decision making. • A smooth implementation.We'll work closely with you to create a transition plan that minimizes operational disruption. We'll analyze your current processes, explore options for improvement and identify strategies that create new growth opportunities. CITY OF PORT ARTHUR im Proposal to provide comprehensive banking services to the City of Port Arthur PP- PN C ■ Exceptional customer support. Just like City of Port Arthur, we're dedicated to customer service. Greenwich, an independent third We're committed to digital innovation and the delivery of new technologies and services that help you achieve sustainable, profitable growth. Greenwich, an independent third party, recently released their annual scores on banking service; PNC was privileged to be ranked best in class in customer service, ease of product implementation, overall product capability, effectiveness of fraud prevention capabilities, innovation in products and services, digital product capabilities and overall digital experience. • Ongoing training on product enhancements. We invest nearly$90 million annually in new technologies, infrastructure upgrades and product development efforts—keeping the specific treasury challenges and requirements of organizations like yours top of mind. And you'll receive new training and tools that help you take full advantage of our latest enhancements. We look forward to discussing how PNC can team with the City to implement the required and requested services that drives newfound success by helping you achieve your bank depository needs. CITY OF PORT ARTHUR 111 Proposal to provide comprehensive banking services to the City of Port Arthur '> p' `c frT - s. "'`'" . ladoill _ I 4 -'. k Our Answers to Your Questions . . . ........„„ , MO ....„,„ . -.„--- „. -.......m. „. t 1 , , , , ,.. , sue CITY OF PORT ARTHUR mi Proposal to provide comprehensive banking services to the City of Port Arthur � PN C Our Answers to Your Questions Bank Depository Services The City requests information on the following services: A. Account Services The City anticipates establishing an account configuration that consists of the following bank accounts. This will differ slightly from the current configuration. • Cash Concentration Account— Interest Bearing or Sweep Account • Controlled Disbursement Account—Accounts Payable/Payroll • Checking Account (Municipal Court) The Cash Concentration Account serves as the City's master operating account into which wires and ACH transfers are received, bank deposits are made, credit card settlements are cleared, and receipts from direct account debits and payments received through the internet are deposited. From this account, wire and ACH transfers are initiated, credit card fees and charge backs are presented, returned checks and deposit corrections are posted, and bank services/account analysis fees are to be debited. Investment activity of purchases and sales are made from this account and it is the master funding account for the subsidiary controlled disbursement and zero balance accounts which include payroll and accounts payable. Any excess cash balances left in the concentration account shall earn interest or be swept into an account which earns interest overnight. The City wishes to set up a one (1) to two (2) controlled disbursement accounts for clearing payroll and accounts payable checks which will be funded by the Cash Concentration Account. Check presentments will be limited to one (1) to two (2) per day so that disbursement totals can be available by approximately 10:00 a.m. Deposits to this account will consist of automated transfers from the master concentration account and will be equal to the total of disbursements so that the balance will always be zero. The City currently maintains two (2) separate zero balance accounts for payroll and accounts payable with no controlled disbursement account. The City has approximately a 740-person payroll paid bi-weekly with an approximate amount of$1,350,000 per pay period. Approximately 1-5 actual payroll checks are written each pay period with almost 100% of employees utilizing the direct deposit. Accounts Payable checks are issued bi-weekly, on Wednesday. The average number of checks per month is 800 totaling approximately $6,500,000. Currently one (1) additional checking account will be required for Municipal Court. It is relatively a low volume account used for the refund of cash bonds at Municipal Court. Estimated historic activity and balance information from each of these accounts is tabulated in Exhibits 2 and 3, and targeted on the Fee Schedule but may not be reflective of any future balances. All City funds shall be managed in accordance with the approved investment policy and invested in a manner which will offer the best return to the City. CITY OF PORT ARTHUR 6 Proposal to provide comprehensive banking services to the City of Port Arthur � PN C Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: PNC will provide the City with required accounts appropriate for all of your needs. We are confident that we will be able to provide the City with the access needed for these unique circumstances. B. Deposit Services 1. Deposit/Credit - The City requires, at a minimum, same day credit for all transactions submitted before 4:00 PM, subject to the bank's availability schedule. Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Deposits received prior to the published deposit cutoff time will be credited to your bank account on that same business day. Our terms and conditions will specify our deadlines and funds availability. Your account will be credited based on the declared value listed on the deposit ticket, and a debit or credit adjustment will be processed if the physical count differs from the declared value, subject to our terms and conditions and funds availability. 2. Cash/Vault Services — The City makes daily deposits of cash and frequently places orders for coin and currency. The City requires the ability to make cash deposits and receive change orders directly at a branch location located within the city limits of Port Arthur. Or deposits can be transported to an alternate location via an armored car service which has been contracted by the City or the bank. Please include any costs for the service to be passed on to the City in the event an armored car service is required. Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: It would be the City's responsibility to arrange the courier pickup with their selected armed carrier. PNC does not make these arrangements. PNC does; however, offer a Remote Safe solution where the safe and armored carrier are all part of a bundled price that is billed through the analysis statement. The City would work through PNC to arrange pickups for the Remote Safe. Please see information below for PNC's Cash Logistics services. PNC Delivers PNC's Cash Logistics services are designed to provide a depository channel and the daily operating cash for businesses handling or requiring large quantities of cash. Cash Logistics uses current technology to perform your cash reconcilement processes including tracking, controlling, monitoring and reporting all of the activity associated with the cash received and disbursed within the cash operations areas of your business. Our national network of cash operations facilities enables you to maintain your banking relationship with PNC, even if your needs extend beyond the PNC branch footprint. Our Cash Logistic services include the following capabilities: CITY OF PORT ARTHUR Proposal to provide comprehensive banking services to the City of Port Arthur � PN C • A national cash vault network of more than 130 locations covering most major U.S. cities • Operations centers with state-of-the-art security and surveillance technologies • Flexible deposit preparation requirements—including the acceptance of check deposits—with market-friendly deposit cutoff times • Automated touch-tone or web-based cash ordering options to obtain daily currency and coin requirements • Complete daily reporting with audit trail through PINACLE®, PNC's corporate online and mobile banking portal • Multiple options for cash receipts summarizing your debit and credit activity, including email or online reporting • With PNC's Remote Safe Solution service, you can manage the cash process at the cashier level for fast, accurate balancing, while at the same time providing for accountability and security within the store. PNC can generate a proximity study that identifies the closest cash vault that would support each of your locations. With PNC's Cash Logistics, you can: Maximize the availability of cash receivables in the operating account through our extended deadlines for deposit credit. Place orders up to 14 days in advance of the required delivery date through our cash ordering applications. 0 More efficiently handle cash instead of transporting cash deposits to the bank or to obtain change orders by your employees. Enhance reconcilement processes with our comprehensive daily reporting available through our Cash Logistics Information Portal (CLIP) = technology. 3. Returned Check Reprocessing — The City requires deposited checks to be processed for collection at least twice before making non-paid checks available for pick-up by the City within two business days of the final rejected presentment. The City requires same day notification of all returned items in excess of$5,000.00. x Yes, can provide as requested/required. G No. cannot provide as requested/required. Comment: CITY OF PORT ARTHUR 8 Proposal to provide comprehensive banking services to the City of Port Arthur dr' PN C PNC can receive and process returned checks (RCK) origination files from direct transmission clients and through the PINACLE°bulk load feature. You may also use the Return Check Management service to automate the creation and submission of RCK entries. With this, you have the ability to view images and statistical reporting of all returned checks in addition to those represented via paper or RCK with Return Check Management web reporting via PINACLE®. Access to the data and images related to your return items is available for 13 months within the reporting module. PNC's Return Check Management service will systematically decision return items to determine if they meet all eligibility requirements as prescribed by Nacha Rules for RCK conversion. RCK items that do not meet these eligibility requirements may be re-presented via paper. Redeposit of RCK entries that are returned for insufficient funds (R01) and uncollected funds (R09) are available. RCK returns can be redeposited a maximum of two times following the original check deposit Required notice including applicable collection fees and retention of the original check is managed by the Originator. We can also receive origination files for collection fees from direct transmission customers and through PINACLE°Bulk Load. Redeposit of these entries that are returned for insufficient funds(R01) or uncollected funds (R09) are available. 4. Remote Deposit Capture — The City requires remote deposit capture services for electronically preparing and submitting deposits. Bank will need to be able to provide and install the check scanning equipment. What will be the City's options for bank supplied equipment? What is the deposit cutoff deadline for same day credit and reporting availability? ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: PNC's Deposit On-Site®services are designed to help you streamline deposit preparation and eliminate multiple trips to the bank, whether you are at your desk or on the go. You Accelerate funds can easily capture images of the consumer and business checks you receive and then availability and transmit the check images to PNC for processing, helping you to reduce administrative improve time and expense. And, since fewer depository accounts are required in multiple locations, you can also reduce the banking fees you incur. efficiencies with® Deposit On-Site Deposit On-Site®Web Web or Mobile. In order to scan checks, authorized accounts must be set up in your profile. Once the location and account are selected, an Enter Deposit Total field appears. You can enter the deposit amount, select"Start Capture" and scan your checks. The check total will be compared to the deposit ticket and deposit total entered prior to transmission. The scanner images the front and back of check. Prior to completion, a list of all checks scanned is available for review. Errors are noted and must be fixed before completing a deposit. After scanning checks, the Edit Item window can be used to enter the data for the custom fields if the custom fields are set up as editable. If custom fields are set up as mandatory, each check will be flagged and will require the operator to open the item and enter the required information. Once all data entry has been completed, and the deposit is balanced, the deposit is ready to transmit to PNC. The system automatically determines if the deposit is in balance. If errors are detected, you have the ability to drill down to specific checks to fix issues. Once in balance, the deposit is ready to transmit to PNC. CITY OF PORT ARTHUR 9 Proposal to provide comprehensive banking services to the City of Port Arthur � PNC Deposits can be queued up for a single transmission or can be transmitted as they are completed. Eight different deposit summary or detail reports are available within Deposit On-Site in formats including .pdf, .csv and .xls. The Deposit Detail Report includes check images (front and back) and can include custom field details. Deposit On-Site® Mobile PNC developed the mobile app specifically to serve the needs of corporations because companies today are on the move like never before. It's easy to download and easy to use, and it has the same security features you've come to expect with your desktop application. °ep Ze"sk • Mobile users access their mobile phone's associated app store to download PNC's Deposit On-Site®app at no charge. • The mobile app authenticates and connects your user to the Deposit On-Site® service without ever storing your security credentials, data or check images. • Mobile users create a new deposit by taking a picture of the check and entering the associated dollar amount. • Deposit details can then be viewed from a mobile device. • Mobile users can deposit more than one check per deposit and set up additional data entry fields at the deposit or check level. This enables a user to submit additional information about the deposits and check payments submitted for deposit on a mobile device. Integration with Deposit On-Site®Web offers a true multi-channel solution your business can use Deposit On-Site®Mobile as your sole deposit channel or use the mobile channel in addition to your Deposit On- Site®web-based desktop scanner service. C. Stop Payment Services The City shall require the Bank to issue stop payments upon transmission of request through on-line services from authorized City personnel. The City may also occasionally request stop payments upon telephone communication from authorized City personnel followed by written confirmation. Please include the cost for this service as well as length of time the stop payment will be in effect without renewal. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Both Positive Pay and Stop Payments services can be managed through PINACLE®, PNC's corporate online and mobile banking portal. Positive Pay decision deadline is 12:00 p.m. CT. Stop Payments can be initiated at any time via PINACLE°as individual stop payments, as a larger file import or by calling Treasury Management Client Care. D. Fraud Protection Services 1. Check Fraud Protection - The City requires positive pay to protect the City against check fraud. The Bank would only honor those checks issued by the City that are pre-authorized through the positive pay system. Payment verification criteria will be date, check number, amount, and payee name. Positive Pay files will be transmitted electronically. CITY OF PORT ARTHUR 10 Proposal to provide comprehensive banking services to the City of Port Arthur ►% PNC © Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: PNC offers Positive Pay services. Positive Pay, when used in conjunction with other ARP plans, complements the internal security measures that you use to protect checks. We'll work closely with the City to verify that only authorized checks are paid. PNC's fraud prevention tools can help you reduce disbursement risk: • Positive Pay and Payee Positive Pay—Timely access to information also helps you to identify exception items sooner and reconcile disbursement account activity more quickly and accurately. • Teller Positive Pay—With Teller Positive Pay, checks presented for payment at PNC branches will be matched against the issue information you provide. • Point of Sale Positive Pay—With PNC's Point-of-Sale Positive Pay service, you send us a daily file of your issue data and we will match it against what is presented for payment at a nationwide network of participating retail locations. • Reverse Positive Pay—With PNC's Reverse Positive Pay service, you can review your prior day's paid checks, view images of these checks, make corrections and submit your return instructions, all through one online tool. 2. Debit Protection Services —The City requires ACH debit blocking capabilities on its accounts, with the ability to selectively permit specified ACH debits on certain accounts and restrict all ACH debits from certain accounts. © Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Yes, you may choose to block all ACH debits presented to your account. As an option, you can view these returned items through PINACLE®reporting. In addition, we offer the PINACLE®ACH Positive Pay service. ACH Positive Pay filters ACH debits presented to your account to help you avoid unauthorized ACH debits while allowing authorized debits to pay automatically. ACH Positive Pay uses the originating (sender's) company ID to identify authorized originators, allowing rules creation and suspects decisions and approval directly. You can further refine which debits to automatically pay by specifying allowable dates, amounts, frequency, or number of occurrences. Any ACH debits not automatically paid based on your established rules can be reviewed online, where you can decision the entries to be paid or returned, in addition, you may create a new authorization rule based on the entry. Any unauthorized ACH debits are returned before they are posted to your account. All suspects not matching your rules are presented daily at 5:00 a.m. CT, with decisions required by 4:30 p.m. CT. With ACH Positive Pay, you can select a default decision of suspects for each account set up with the service. The default decision is either pay or return the suspects if no decisions were submitted on the suspects by 4:30 p.m. CT on that banking day, and PNC will act on those items based on your default decision. CITY OF PORT ARTHUR III Proposal to provide comprehensive banking services to the City of Port Arthur � PN C Suspects Decision Suspects Prod ig 1 Close Decision Modify Rules Rules 'indicates required field Transaction Number Add 300000820-1 Manage 'Account;1121999999(AFP; Apprrave 'Originating 11234567890 ACH PAR Number: Company ID: - - - 13013000037571 Reports Onpinacng Company ITEST 1 BATCH 1 -_---- Create Name' - Effective Date: 0 1/112 0 1 3 View 'Amount Type:'Unlimited 1 9.999.999.499.991 Help 'Stagnate: 101;07,2013 ®I Individual ID: :ronrer uwCEYn cc eves seproved today Entry Description:are notetfeetree for terns w teneary prmnted l BMT 'Recarrence: r Unlimited I SEC: r Expiration Data �! PPD The ACH Positive Pay module offers multiple levels of security. Secondary approval of rules helps give you additional control over approving suspect debits presented for your review. Available user reports include: • Details Report—Displaying detailed activity for authorized items, as well as all items presented as suspects. Suspects indicate if a decision has been submitted or if the item still requires action. • Summary Report—Displaying summary level account activity such as number of transactions and total amounts of Suspects Paid, Suspects Returned and Authorized Items for a specific date. • Account Status Report— Providing general information as to the service option (i.e., ACH Positive Pay, Debit Block)for each account, its status, number of rules, and how converted checks are processed. • Rules Report—Providing a list of all rules. Available administrator reports include: • Entitlements report lists the functional elements to which a specific user or role has been granted access. • Audit report logs all user activity by date, time, user, and action. Additionally, event notifications are available to help you further manage the suspects with the ACH Positive Pay module by providing timely notifications with any suspects and rules to decision and/or approve. CITY OF PORT ARTHUR El Proposal to provide comprehensive banking services to the City of Port Arthur � PN Create Notifications Notification and Alert Delivery Status lti ; Category Awaiting Approval • Administration E Awateg Apprc ial Batches Pennon Aothonration Tetnplates Penthea Anoroval G stonaze your rorticatcr by defirmg a bald amount _e nol be i «;emnatec rw2rm_auPtcvai trresror! Ba ances&-ransaMxins 4 Informational Exceptions&Rejections _ Informaticnat 9 Transaction Activity Available Be conned wren autnor_ed trarsactcr.s are receved [] Statements&Reporting 4 O Module • ACH 2 • ACH Positive Pay 1 rf,AAP Statements 1 Choose from 12 event notification options to customize your alerts. E. Reconciliation Services Account Reconciliation Service—The City requires account reconciliation services on the Controlled Disbursement Account used for payroll and accounts payable. Bank shall provide the City with a reconciliation statement containing all checks paid and outstanding checks. Account reconciliation files will be transmitted electronically. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: PNC will be able to provide the City with a Controlled Disbursement Account for Payroll/Accounts Payable. We will evaluate your services with PNC going forward and make changes where we see opportunities for efficiencies and cost reductions for the City. Our platform offers a state-of-the-art file transfer infrastructure with expanded file transfer protocol options. A PNC file transfer consultant will work directly with the City's technical resources to implement the solution that best meets your business needs. You'll have the choice of using the following transmission protocols: • AS2 • PNC My File Gateway (https) • Secure FTP (SFTP) • Virtual Private Network(VPN) • Connect:Direct • SWIFT CITY OF PORT ARTHUR IIIII 1 Proposal to provide comprehensive banking services to the City of Port Arthur � ■ N C F. Funds Transfer Services 1. Wire Transfers Outlln — The City shall periodically wire funds to various vendors, paying agents, and brokers upon transmission of request through on- line banking services accessible through the internet or upon written request. The City shall require the Bank to accept incoming wire transfers of funds for the sale of securities, interest payments, receipts from various governmental agencies or other miscellaneous receipts. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: In order to provide you with wire transfer methods that work with your current systems and processes, you'll be able to choose from six options to initiate wires, through our online portal, by telephone, by standing transfer order, through file transmission wires, application programming interfaces (APIs) and via SWIFT. Our recommended approach will depend on your volume of use and preferences for payment order entry. 2. Internal Bank Transfers —The City shall periodically transfer funds from one City bank account to another upon transmission of request through on-line banking services accessible through the internet or upon written request. © Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: You may initiate a wire request outside of these hours. The request will be processed during the next business day. Input Method All Wire Types Federal Tax Payments Except Federal Tax Open: Immediately following the Open: Immediately following the Internet Portal close of the previous business day previous business day's tax payment cutoff* (PINACLE°Funds Transfer) Initiation deadline: 5:42 p.m. CT Initiation deadline: 3:28 p.m. CT Approval deadline: 5:44 p.m. CT Approval deadline: 3:30 p.m. CT File-Initiated Wires Open: 8:00 p.m. CT(previous day)* Open: 8:00 p.m. CT (previous day)* • EDI • Integrated Payables • SWIFT FileAct File deadline: 5:15 p.m. CT File deadline: 3:30 p.m. CT • Wire-only direct transmission Open: 7:30 a.m. CT Open: 7:30 a.m. CT Telephone Close: 4:00 p.m. CT Close 3:00 p.m. CT CITY OF PORT ARTHUR Proposal to provide comprehensive banking services to the City of Port Arthur � PNC First order: 7:00 a.m. CT First order: 7:00 a.m. CT Standing Transfer Order Last order: 5:15 p.m. CT Last order: 3:30 p.m. CT SWIFT Open: Immediately following the close of the previous business day* • MT101/MT103 Initiation deadline: 5:44 p.m. CT *All wire payments initiated after the deadline before 11:00 a.m. CT are for the next business day. G. ACH Services 1. Payroll Direct Deposit—The City offers its employees the option of having their payroll check automatically deposited into their checking and/or savings account each payday. Currently approximately 740 employees (almost 100%) utilize direct deposit. The City will transmit the file through on-line services via the ACH system on a bi-weekly basis. The ACH file is prepared and transmitted on Wednesday for employee payment receipt on Friday. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Depending on how the recipient is enrolled and what payment type they select, typical access to funds will vary. Below are the general guidelines: • Recipient is enrolled through a bank offering Zelle°—within minutes • Recipient is enrolled directly in Zelle via their debit card—within minutes • Direct Deposit via RTP°—within minutes • Direct Deposit via Standard ACH—next business day • Direct to Debit Card—within minutes • Check—within three to five business days after mailing 2. Other ACH Debit and Credit Transactions —The City shall periodically send payments to vendors through the ACH system upon transmission of request through on-line services. And the City shall require the Bank to accept incoming receipts from various governmental agencies or miscellaneous receipts through the ACH system. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Our platform offers a state-of-the-art file transfer infrastructure with expanded file transfer protocol options. A PNC file transfer consultant will work directly with the City's technical resources to implement the solution that best meets your business needs. You'll have the choice of using the following transmission protocols: CITY OF PORT ARTHUR II Proposal to provide comprehensive banking services to the City of Port Arthur � PN C • AS2 • PNC My File Gateway (https) • Secure FTP (SFTP) • Virtual Private Network (VPN) • Connect:Direct • SWIFT H. Information Services 1. On-Line Balance Reporting - The City requires on-line balance reporting services accessible through the internet. Additional capabilities shall include the ability to reprint statements and export information to MS-Excel. The minimum balance reporting information shall be for intra-day and previous business day Information shall be available by approximately 10:00 am each day and include: previous day ledger balance, collected balance, one day float amount, two day float amount, current day controlled disbursement totals, current and previous day ACH and wire debit and credit transactions including detail descriptions. On- line banking services shall also allow transaction search capability and historical information should be maintained on-line and accessible for a minimum of four months. Z Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Please see Attachment A—Sample PINACLE®reports. You'll have quick access to both current day and previous day information with PINACLE®. We offer the option to customize information reporting, so you can create and view reports that contain the information most important to you. „� A» .a,ea,e; , aaa,naS .0 tLa .�.L.45 ,k„&T,er,9 Lagra1 PINACLE'I e PNC e�ea I RaD1, ="c.e o I gg. �RDa aaaR.,A,1°a „AD .,RA�R. auReeORnRg aRAT�laalTa ( ,a„Ra,ER oR-06,..aD 1 RERgR,a�D gaa .,aR�F � ERTaR. A�rARTa�6 ,.AE„�„ Ra RJR,�z You have]alerts in the Message Center .Information Reporting - Re* c Reaeaa ipaaaraed o aelgecee Rea.. Q Fawrne Re9oas ®Q ilanza,b 5.5th Q SxxN se r,.. 0 Sfil Amount a c'][` -.1 O y "'/ a..aamhere. Dale aero aee �9RVN 9 cnneme,arov Da, �! E1R� M9na2~1 Current Day Balances Mir arienc a,aD�,z«D,e 't5®eoaa�.eelNne CURREM LEDGER CIARFMT AvedaelE l£IOTNS OAT 1MYFLMT TOTAL CREWS TOTAL OHM Total USD 16.)05.200.25 16.0029225 0190S.121 3.36900 55.951 Ma 39 39.09001a)a Tatl-9Lot9 USD 66. 66. D00 00l 6666 66. Current and Previous Day Reporting provides you with quick access to transaction information. CITY OF PORT ARTHUR 16 Proposal to provide comprehensive banking services to the City of Port Arthur � PNC Reports can be viewed within the portal, or you may opt to have them emailed to you on a regular schedule. Secure emailed reports arrive password-protected or delivered via Transport Layer Security (TLS) encryption and can be sent to up to 10 additional recipients. All standard, custom, and shared reports are available via email, including current and previous day reports. How long are the following items Standard Term Optional Terms Available available? for Additional Fee Prior/ Previous Day Reporting Two years Two years Current Day Reporting 1 day N/A Monthly Account Statements ARP: 18 months ARP: 18 months DDA: Seven years DDA: Seven years Images of Checks Paid Seven years 10 years Images of Items Deposited with RDC Seven years Seven years 2. Bank Statements - Statements shall be available online within one (1) business day and a hard copy mailed within five (5) working days after the close of the calendar month. Accounts shall not be placed in dormant mode for inactivity. The statement shall include debits and credits made on the last day of the period and the detail items. Bank statements should be received on a monthly basis, even if there is no activity for the account. All statements, checks, and deposit slips shall be electronically imaged and forwarded to the City. 1Z Yes. can provide as requested/required. No, cannot provide as requested/required. Comment: Online By Mail Bank Statements First business day after 10 days after month-end. month-end. Statements are available Statements are mailed the on PINACLE®the next next business day after the Full Reconciliation Information business day after the statement drops. ARP has statement drops. ARP has up to five business days to up to five business days to drop the statements. drop the statements. Statements are available Statements are available on PINACLE®the next mailed the next business Account Analysis Statement business day after the day after the statement statement drops. ARP has drops. ARP has up to five up to five business days to business days to drop the drop the statements. statements. CITY OF PORT ARTHUR Proposal to provide comprehensive banking services to the City of Port Arthur P.-- PNC I. Other Services 1. Research — The City requests that all research requests are responded to within three business days of the request. u Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: The City will have access to one of our dedicated Treasury Management Client Care(TMCC) Service teams. Your Dedicated team will have a unique mailbox that four representatives will monitor. Representatives on each team will have experience with all clients within their team and be able to assist in the absence of a team member. Some benefits of this model include coast to coast coverage as well as continuity of support when a team member is out of the office. You can contact TMCC via email, phone, and mail or via PINACLE®. All members of your client care team are dedicated to resolve requests promptly and will "own"your issue from beginning to end. Team members are generally available Monday through Friday during extended hours from 6:30 a.m. to 7:00 p.m. CT. Gain Access to Customer Service Functions and Information 24/7 through PINACLE® You can also access customer service functions and information 24 hours a day, 7 days a week through PINACLE®. Within the portal, you can: • Report an issue, which is sent directly to TMCC for research. • Track the status of the issue. • Receive an automatic email notification when your issue is resolved. • View resolution details via an email link. • Refer to a comprehensive list of frequently asked questions and answers about Treasury Management products. • View tip cards and training videos. 2. Bank Errors — Bank errors resulting in lost interest to the City will be reimbursed by the Bank to the City. The Bank and the City will agree upon the method of reimbursement. T Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: All back-value adjustments for bank processing errors are applied in conjunction with the National Council for Uniform Interest Compensation, Inc. (NCUIC) rules for compensation. Back-value compensation does not impact account analysis, which would remain the same. Back-value compensation would be reflected in the deposit statement. PNC will contact you regarding the amount and the timing of the posting of back-value compensation. CITY OF PORT ARTHUR III Proposal to provide comprehensive banking services to the City of Port Arthur � PNC 3. Acceptable Tamperproof Bank Bags - Bank shall provide 12 x16 and 9 x 12 tamperproof bank bags at no charge. If there is a charge, please provide cost information. ❑ Yes, can provide as requested/required. ® No, cannot provide as requested/required. Comment: Clear plastic bags are required for all deposit bags used in the Cash Vault Services. Disposable plastic bags are required for night drop processing. Bags may be ordered through us or through your preferred vendor and must be approved by Cash Vault Services Operations. We provide sample bags in the new client welcome kit with Harland Clarke order instructions. 4. Auditor Confirmations - Confirm that the Bank can provide audit confirmations in conjunction with its annual audit at no charge. If there is a charge, please provide cost information. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: External vendors or other third parties, such as auditors who request account information on a PNC business customer's checking, savings and/or loan accounts are referred to as commercial credit references, and they occur as part of a pending transaction the external party is conducting with the PNC business customer. PNC Bank's Credit Investigations department handles credit references Refer external vendors or other third parties requesting account information or a validation of assets or verification of deposit(VOD) to pnc.credit.investigations.internal@pnc.com. They handle all credit reference requests. Submitting requests via Confirmation.com External vendors and third parties must submit credit reference requests online through www.confirmation.com. PNC won't process credit reference requests submitted via mail, fax or email. Fees Please refer to the PNC Bank TM Pricing Proforma for additional information. Turnaround time and results Credit reference requests will be completed within 24-36 hours. Requesters can check the status of their request on the activity log on to Confirmation.com The requester will receive an email from Confirmation.com once the request is completed. 5. Disaster Preparedness - In the event of a disaster or national emergency such as a hurricane, flood, or civil unrest, the financial institution will have available with 24 hours of notice, $50,000 in cash for the City. The cash will be as a site mutually agreeable by both parties. In the event of a major disaster such as a hurricane, the financial institution will have a facility open in the Port Arthur area for the City's use within 72 hours after the event is over. The City recognizes that it might have to make special accommodations such as security and a location CITY OF PORT ARTHUR 19 Proposal to provide comprehensive banking services to the City of Port Arthur � PN C for this to occur. Final details will be negotiated with the successful financial institution. ri Yes, can provide as requested/required. Nx No, cannot provide as requested/required. Comment: PNC has developed disaster recovery plans that: • Cover hardware, software (applications, operating systems', and utilities), communications (network and telecommunications) and data. • Outline recovery strategies to be used in restoring the processing environment in the event of a disaster. PNC prioritizes recovery based on criticality. Recovery Time Objectives values vary by business process, are obtained from the business impact analyses that are performed annually, and include assessment and prioritization of business functions, identification of the legal, regulatory, reputational, and financial impact of business disruptions, estimation of maximum allowable downtime, and level of losses and recovery of the critical path. The City can contact your dedicated day-to-day contact to initiate day-to-day transactions if online capabilities and functionality are temporarily unavailable. You'll also be assigned a dedicated TMCC representative and would have access to this representative's direct phone line and email. In the event of a natural disaster or other emergency situation PNC will employ our crisis management protocol as part of our Business Continuity Program. PNC's Enterprise Crisis Management team maintains partnerships with a wide range of agencies, authorities and organizations to receive incident and event notification allowing for a quick and coordinated organizational response to crisis events. Additional steps, which also serve to mitigate and reduce impact to customer services, include: • Establishment of crisis management teams that conduct impact assessment, notify critical contacts, and coordinate overall response. • Coordinating crisis communications to provide notification and impact assessment to employees, customers, regulators, and third parties. • Execution of scenario-based walkthroughs, which promote an understanding of assessed impact, crisis response, and recovery capabilities. • Testing of crisis management response processes, tools, and resources that improve overall effectiveness of crisis management. While we cannot commit to a specific set of actions we will work with the City as we both assess the event and determine best courses of action given the situation unfolding. To note, PNC has alternative branches located in both the Beaumont and Orange areas that are within 20 miles from the City of Port Arthur. CITY OF PORT ARTHUR 20 Proposal to provide comprehensive banking services to the City of Port Arthur � T'N C J. Optional Services 1. Automatic Bill Payment Service/Direct Debit — The City desires to provide its water utility and other customers with the option of paying for services by having their checking or savings account directly charged (debited) each month. When set up, the City will transmit information through the ACH system on a daily or weekly basis. �x' Yes, can provide as requested/required. E No, cannot provide as requested/required. Comment: PNC accepts both debits and credits on the same file. There are no additional requirements. CITY OF PORT ARTHUR III Proposal to provide comprehensive banking services to the City of Port Arthur '� PNC Net Earnings Net earnings will be calculated as the difference between the total annual cost of banking services and the total annual interest earnings (including earnings credits if applicable) as described below and as indicated on the attached fee schedule. A. Cost of Banking Services 1. Payment for Services — The City intends to pay for all services provided by the earnings credit amount generated by account balances, or by direct payment, or a combination of both. The City requires the ability to change the method of payment selected any time during the contract period to recognize earnings made possible by changes in interest rates. The City shall require that all fees remain constant throughout the contract period. Account settlement for fees owed by the City shall be made by direct debit from the City's Cash Concentration Account on a monthly basis. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: We accept compensation by fee, balance or a combination of both. Regardless of which option you choose, the prices are the same—there is no surcharge for fee compensation. If you maintain a balance in a non-interest bearing checking account, you'll receive an earnings credit that is applied to offset your fees. If you maintain a balance in an interest bearing checking account, we'll charge fees on a monthly basis, as there is no earnings credit on such accounts. With respect to fees, we agree to hold our treasury management services unit pricing throughout the contract period. ECR and Interest rates are bank managed and subject to change at the bank's sole discretion at any time, taking into consideration overall market conditions and the competitive landscape. PNC Bank reserves the right to charge fees for services used but not quoted in the Exhibit, including but not limited to overdraft charges, negative earnings credits, and late fees. Treasury Management implementation, set-up, and line item fees for any additional Services and/or upgrades to existing Services that may be requested by the Customer shall be negotiated by the parties. 2. Monthly Account Analysis —The City requires account analysis statements by individual account and at group level, which will reflect average ledger balance, average uncollected funds, average collected balance, reserve requirement, average available balance, rate and amount of earnings credit, detail of services provided with quantities and unit fees for each, and total service cost, delivered to the City on a monthly basis. ❑x Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Online By Mail Statements are available Statements are available Account Analysis Statement on PINACLE®the next mailed the next business business day after the day after the statement CITY OF PORT ARTHUR 22 sre'- Proposal to provide comprehensive banking services to the City of Port Arthur � PNC statement drops. ARP has drops. ARP has up to five up to five business days to business days to drop the drop the statements. statements. B. Interest Earnings 1. Interest Bearing or Sweep Account— The City will require that all collected funds remaining in all City accounts (less required target balances) earn a return such that the City will be credited daily or monthly with interest earnings. The City will consider the use of a sweep account for overnight investment of funds in excess of a target balance. This sweep investment account shall comply with the Public Funds Investment Act and the City's Investment Policy. Or alternately, the accounts could be set up as interest bearing accounts. Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: PNC has included competitive fees and rates that demonstrate our commitment to you and will help you succeed well into the future. We're proposing an optimal mix of the City's deposits (balances)to offset fees, while providing an alternative investment solution (Money Market Demand Account Sweep) for any excess cash. Our Earnings Credit and Money Market Demand Account Sweep rates are highlighted in the executive summary section of our response. The Earnings Credit Rate (ECR) and Money Market Demand Account Sweep rate are bank managed and subject to change at the bank's sole discretion at any time, taking into consideration overall market conditions and the competitive landscape. Our on balance sheet sweep products (MMDA Sweep) act in accordance with the Texas Public Funds Act. 2. Rate of Return — The City will seek the highest rate of return on overnight investments. The rate can be tied to the Fed Fund Rate or the 90 day Treasury Bill rate (T-Bill) in that it would maintain a constant basis point spread below (or above) the average Fed Fund Rate or T-Bill rate throughout the contracted time period. Or the rate could be based on the market rate (less any investment fees) of whatever overnight investment instrument is proposed. There is a wide variety of overnight investments products available. Please discuss the Bank's rates and methodology in detail in the response attachments section 2 and be sure to include a historical rate schedule of each investment product proposed. A separate rate may be stipulated for the concentration account and the special purpose (limited activity) accounts as the concentration account will have unlimited debits and credits each month while the special purpose accounts will have very limited activity. Please include the current interest rates of the proposed investment products in the appropriate sections of the fee schedule. CITY OF PORT ARTHUR III Proposal to provide comprehensive banking services to the City of Port Arthur I� F'NC The bank also shall agree to make rate information available to the City on a daily or weekly basis via on-line services so that the City may make decisions regarding the investment of funds. �x' Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Our Earnings Credit and Money Market Demand Account Sweep rates are highlighted in the executive summary section of our response as well as in fee schedule attachment included with our response. 3. Safekeeping Services — The City shall have the right, at its sole discretion, to direct investment of its funds in accordance with State Law and the City's Investment Policy. The Bank shall be required to safe-keep securities purchased by the City from other banks or brokers on a DVP basis (delivery vs. payment) in the trust department of the bank. Please include the appropriate pricing information. © Yes, can provide as requested/required. ❑ No, cannot provide as requested/required. Comment: Our BASK (Bond Accounting and Safekeeping) product is provided through the investment Operations area of PNC Bank and not our trust area. We have a variety of customers that use the safekeeping service (Banks, Municipalities, Universities, etc.). We are able to settle trades as DVP with a PNC DDA account. Collateral Requirements A. With the exception of deposits secured with irrevocable letters of credit at 100% of amount, as security for the deposits of the City, the successful applicant shall pledge securities equal to 102% of their market value, of the largest total balances the City maintains in the bank, less the amount provided by the Federal Deposit Insurance Corporation. The securities so pledged shall satisfy the requirements of the Public Funds Collateral Act, Chapter 2257, Texas Local Government Code as well as the City's Investment Policy. Agreed/Acknowledged. El No, cannot provide as requested/required. Comment: Texas collateral requirement is 100% collateralization for those deposits exceeding FDIC insurance. PNC Bank will collateralize the City's deposits at 102% as requested. B. The balances maintained in all accounts must be collateralized in the same manner and under the same stipulations as outlined in A. above. The City anticipates utilizing interest bearing accounts and/or an overnight sweep investment option. In the event interest-bearing accounts are utilized, the maximum ledger balances could exceed $30,000,000 in the aggregate. However, the City's goal is to target average balances of$10,000,000 or less. Please clearly explain any collateral limitations or fees. The City reserves the right to maximize CiTY OF PORT ARTHUR 111 Proposal to provide comprehensive banking services to the City of Port Arthur PNC or minimize bank balances regardless of historical patterns. It is expected that the successful bank will monitor the collateral adequacy on a daily basis and, with prior notice by the City, provide additional collateral to secure balances in excess of anticipated levels. ❑x Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: With regards to monitoring collateral, PNC Bank monitors deposits and collateral on a daily basis. For intraday deposits, the City can notify PNC Bank by emailing alfundingdesk(a�pnc.com by 1:00pm EST. Once deposit has arrived at PNC Bank, we will pledge sufficient collateral. C. The securities pledged shall be held in safekeeping, pursuant to a safekeeping agreement, at an independent financial institution acceptable to both the City and the successful applicant. The original copy of all security receipts and collateral reports shall be filed with the City's Finance Director. Please stipulate the name of the proposed 3rd party custodial bank as well as any related fees. © Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: PNC Bank utilizes the Federal Reserve Bank. The standard Pledgee Agreement which is required by the Federal Reserve Bank will act as the Safekeeping Agreement. D. Any substitutions of the securities or reductions shall be made only so long as the total amount of securities pledged is adequate and with proper written authorization of an authorized City signatory. The City shall approve all securities pledged. In the case of reduction requests, the bank shall provide in writing that collateral shall be available when needed to meet normal balance increases throughout the year. ❑ Agreed/Acknowledged. Z No, cannot provide as requested/required. Comment: PNC Bank needs the ability to perform par-for-par substitution without the City's approval. PNC Bank follows the Texas Public Funds Investment Act as to the acceptable types of collateral. E. The Board of Directors or designated committee of the successful bank will be required to provide a resolution of certification approving the commitment and delivery of the collateral to the safekeeping institution not later than five (5) days before the commencement of the contract period. ❑x Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: None. CITY OF PORT ARTHUR 11 Proposal to provide comprehensive banking services to the City of Port Arthur P6 PNC F. The successful applicant AND the custodial bank shall provide the City a report of securities pledged at the end of each month or at any time requested by the City. The report should reflect the total pledged securities itemized by: a. Name b. Type / Description c. CUSIP d. Par Value e. Current Face Value f. Market Value g. Maturity Date h. Rating by Moody's or Standard & Poor's ® Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: The Custodian (Federal Reserve Bank)will provide a month-end statement and a statement anytime collateral is adjusted. PNC Bank will send a month-end collateral statement with all the information above excluding (h) Rating by Moody's or Standard & Poor's. Overdraft Provisions The City does not intend to have a net overdraft position occur during the course of the contract period. A net overdraft shall be defined as a negative balance in the City's accounts collectively, not by individual account. Please stipulate any deviation from this definition. In the event a check or checks shall be presented for payment where there is insufficient funds for the purpose of paying checks, the successful bank agrees to promptly notify the Finance Director or other signatory person, by telephone or other means, of the overdraft condition, and to provide the City a period not exceeding one business day to respond and rectify the condition. ❑x Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: Our policy is to return items if an overdraft exists; however, the decision is heavily influenced by the overall relationship and credit strength of the City. The Relationship Manager and the Credit Officer communicate to you our decision on any overdraft or potential return of items. We will make every effort to reach you by phone and email as soon as we learn of the overdraft. Overdrafts are not anticipated to occur; however, should a net overdraft condition occur, the following stipulations shall apply: Maximum number of banking days the overdraft shall be allowed: CITY OF PORT ARTHUR 26 Proposal to provide comprehensive banking services to the City of Port Arthur � PNC Maximum amount of the overdraft: $ Interest rate per annum computed on the % overdraft: The compensation for overdraft interest rate is the Prime Rate+3% less the earnings credit rate. There is an additional fee that may be assessed at an account level if an account level monthly average balance is in a negative position. That is assessed at the earnings credit rate. If PNC experiences regularly occurring overdraft situations, the relationship team may seek to establish an appropriate credit facility to cover anticipated account activity in order to avoid these situations. Other Stipulations A. The successful applicant shall notify the City in writing within ten (10) days of any changes in Federal or State regulations or laws that would affect the Bank Depository Services Agreement. C Agreed/Acknowledged. No, cannot provide as requested/required. Comment: PNC has purposely not marked a response. Any regulatory changes that impact a Treasury Management service the City has selected, the City will be notified within a reasonable period through our normal change process identified in the Treasury Management Comprehensive Agreement. B. Notification of incoming wire transfers shall be posted to the On-Line System or made by telephone, fax, or email to the Finance Director within one hour of the transaction and a written confirmation mailed to the City the same day of the transaction. Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: PNC has purposely not marked a response. In order to provide you with wire transfer methods that work with your current systems and processes, you'll be able to choose from five options to initiate wires: through our online portal, by telephone, by standing transfer order, through file transmission wires, APIs and via SWIFT. Our recommended approach will depend on your volume of use and preferences for payment order entry. C. In the event it would be ruled illegal under the provisions of any Federal or State laws or regulations for the successful applicant to comply with the requirements of the Bank Depository Services Agreement, then the City expressly reserves the right and privilege to cancel the Bank Depository Services Agreement and to re-solicit applications. 6 Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: CITY OF PORT ARTHUR El Proposal to provide comprehensive banking services to the City of Port Arthur PN C None. D. The successful applicant's records relating to the City's accounts shall be open for review during normal business hours by designated staff members or appointed independent auditors. ❑ Agreed/Acknowledged. ® No, cannot provide as requested/required. Comment: This Section is subject to negotiation. Any audit rights to which PNC might consent would be limited in scope and frequency, and subject to PNC's security measures and confidentiality requirements. E. The City reserves the right to open and maintain one or more demand accounts at financial institutions not affiliated with the successful applicant. ❑x Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: None. F. The City expressly reserves the right to terminate the depository agreement with or without cause at any time by providing ninety (90) days written notice to the depository to close its accounts. ❑x Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: PNC marked Agreed/Acknowledged, however termination for convenience rights must be mutual. For reference, please refer to Term and Termination except on page 11 from the Treasury Management Services Comprehensive Agreement. G. All fees shall be fixed for the entire contract period, including any and all continuations. © Agreed/Acknowledged. ❑ No, cannot provide as requested/required. Comment: PNC agrees to hold treasury management services unit pricing throughout the contract period. However, ECR and Interest rate pricing may be subject to adjustment based on market conditions during the contract period. CITY OF PORT ARTHUR II 1111r- Proposal to provide comprehensive banking services to the City of Port Arthur ' PN C H. The City requests one relationship manager to coordinate the financial institution's efforts in providing the requested services. This individual will be the City's contact and will be directly responsible for facilitating all City/financial institution interaction: Relationship Officer: Name: Cindy Young Title: Relationship Manager Phone: 713-499-8632 Email: cindy.young@pnc.com I. The City requests one support service point of contact individual who will be readily accessible and technically capable to respond to and address service problems of an immediate nature: Name: Michael Janociak Title: Assistant Vice President, Treasury Management Phone: 312-384-4637 Email: Michael.Janociak@pnc.com CITY OF PORT ARTHUR 29 Proposal to provide comprehensive banking services to the City of Port Arthur � 1'NC Application Submitted By This Application is being submitted to the City by the following person duly authorized to act on behalf of this financial institution. Name of Financial Institution* PNC Bank, National Association Address of Financial Institution Corporate Headquarters: The Tower at PNC Plaza, 300 Fifth Avenue, Pittsburgh, PA 15222 Local Address: 2200 Post Oak Blvd, 20th Floor, Houston, TX 77056 Telephone Number Corporate Phone Number:412-762-2000 Local Phone Number: 713-499-8632 Officer Name & Title (Printed) Cindy Young, Senior Vice President, Relationship Manager Officer Signature** Date 3/13/2023 *The PNC Financial Services Group, Inc. is 100%owner of PNC Bancorp, Inc. which, in turn, is 100%owner of the Applicant, PNC Bank, National Association. PNC Bank, National Association ("PNC Bank N.A.")is The PNC Financial Services Group, Inc. principal banking subsidiary and will be responding to the services in this RFP. ** PNC's signature reflects its agreement to be bound by all conditions of this proposal subject to any exclusions noted. Please refer to PNC's Request for Application Disclosure,Clarifications and Exceptions document in the Appendix section. CITY OF PORT ARTHUR 30 P` PN C Proposal to provide comprehensive banking services to the City of Port Arthur El ... P rwmimaamilia° PI — .„ - .-- t t 4W • i i .,.- I f ' - ‘ I . _ ncin . - - - ... , , . . .. .. .....,, ,. * , t 4466* ,-.4. ---- .-, _.. .., . 1 # , CITY OF PORT ARTHUR II Proposal to provide comprehensive banking services to the City of Port Arthur � PN C Pricing Our competitive fees are a reflection of the exceptional client service you'll receive from PNC, an institution with more than 160 years of financial services experience. We're a client-focused, relationship- driven organization with innovative product and service solutions that will enable City of Port Arthur to achieve your strategic goals and empower you to thrive in the evolving digital economy. Please see Attachment—City of Port Arthur Texas PNC Pricing Proforma for a detailed breakdown of PNC's fees. Terms This proposal is valid for 120 days. PNC Bank reserves the right to adjust the pricing quoted or processing parameters outlined if the proposal is accepted after the 120-day period. All prices quoted are in U.S. dollars. This pricing is for discussion purposes only and is not a contract, an offer to enter into a contract or a commitment to offer the pricing outlined herein. This pricing is delivered by PNC Bank on the condition that it be kept confidential and not be shown to or discussed with any third party, including any financial institution, or used other than for the purpose of evaluating PNC Bank's banking services. PNC Bank reserves the right to charge fees for services used but not quoted in this proposal, including but not limited to overdraft charges, negative earnings credits and late fees. PNC Bank's fee schedule is subject to change from time to time, and any future increases or decreases or changes in transaction code names, definitions or structures shall be applied to all accounts subject to these rates and categorizations. CITY OF PORT ARTHUR II REASURY MANAGEMENT PNC City of Port Arthur Texas PROPOSAL Proposal Date: 010-Demand Deposit AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 100000 MMDA ACCOUNT MAINTENANCE 1 $0.0000 $0.00 010000 ACCOUNT MAINTENANCE 3 $10.0000 $30.00 100200 REGULAR DEPOSIT TICKET 187 $1.0000 $187.00 100220 DEPOSIT ITEMS-ON US(N) 0 $0.0800 $0.00 100200 DEPOSITED ITEMS-TRANSIT 3,080 $0.0800 $246.40 150100 PAID ITEMS 760 $0.0800 $60.80 100400 RETURNS 3 $16.0000 $48.00 100402 RECLEARS 3 $9.0000 $27.00 010-Demand Deposit Total: $599.20 011-Remote Deposit AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 010200 REMOTE DEPOSIT CAPTURE-TICKETS 42 $0.7500 $31.50 100218 REMOTE DEPOSIT CHECK IMAGES 3,080 $0.0600 $184.80 109999 DEPOSIT ON-SITE MONTHLY FEE 1 $30.0000 $30.00 011-Remote Deposit Total: $246.30 030-Cash Logistics AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 100112 NON FED STANDARD CON BAG DEPOSITED 0 $5.0000 $0.00 100113 FED STANDARD COIN BAG DEPOSITED 15 $3.0000 $45.00 100055 CLS DEPOSIT ADJUSTMENT 7 $9.0000 $63.00 100100 CASH ONLY DEPOSIT 0 $1.5000 $0.00 100114 It OF NOTES/BILLS PROCESSED 2,645 $0.0165 $43.64 109999 CLS NIGHT BAG TRANSFER DEPOSIT 40 $5.0000 $200.00 109999 CLS-CLIP ACCESS 1 $10.0000 $10.00 030-Cash Logistics Total: $361.64 070-Account Reconcilement AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 200010 FULL RECON POSPAY MONTHLY 1 $25.0000 $25.00 200110 FULL RECON POSPAY ITEM 760 $0.0500 $38.00 150320 ARP/POSITIVE PAY RETURNS 0 $5.0000 $0.00 209999 ADDITIONAL REPORTING SEQUENCE 1 $10.0000 $10.00 200000 POSITIVE PAY MONTHLY MAINTENANCE 1 $5.0000 $5.00 209999 PAYEE REVIEW MAINTENANCE 1 $5.0000 $5.00 209999 PAYEE REVIEW ITEMS 4 $0.0200 $0.08 999999 PINACLE POSPAY EXCEPTIONS LOADED 4 $0.2500 $1.00 999999 PINACLE ISSUE FILE IMPORT 2 $3.0000 $6.00 j 999999 PINACLE PER STOP INDIVIDUAL ENTRY 0 $15.0000 $0.00 Q-17848 Page 1 of 4 AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 999999 PINACLE CHECK INQUIRY 0 $0.5000 $0.00 999999 PINACLE POSPAY-PAY WITH ISSUE 0 $1.0000 $0.00 999999 FINAGLE ISSUE ADD/CANCEL 7 $0.5000 $3.50 999999 PINACLE ISSUE FILE IMPORT ITEM 760 $0.0100 $10.00 209999 PINACLE POSITIVE PAY-RETURN 0 $3.0000 $0.00 209999 PINACLE IMAGE VIEWED 0 $0.5000 $0.00 070-Account Reconcilement Total: $103.58 080-Controlled Disbursement AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 150000 CONTROLLED DISBURSEMENT MAINTENANCE 1 $50.0000 $50.00 i i 150110 CONTROLLED DISBURSEMENT ITEMS 760 S0.0500 $38.00 080-Controlled Disbursement Total: $88.00 100-Zero Balance Account AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 010020 PARENT ACCOUNT 1 $30.0000 $30.00 010112 ZERO BALANCE TRANSACTIONS 100 $0.2500 $25.00 010020 ZERO BALANCE ACCOUNTS 2 $10.0000 $20.00 100-Zero Balance Account Total: $75.00 110-Automated Clearinghouse AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 250000 ACH MONTHLY MAINTENANCE FEE 1 $20.0000 $20.00 250310 REDEPOSITED ITEM 0 $0.2500 $0.00 250505 PINACLE ACH FILE PROCESSED 2 $5.0000 $10.00 250102 PINACLE ACH DEBIT/CREDIT ORIGINATED 3.261 $0.0800 $260.88 250120 ADDENDA ORIGINATED/RECEIVED 4 $0.0200 $0.08 250200 DEBITS RECEIVED 29 $0.2000 $5.80 250201 CREDITS RECEIVED 234 $0.2000 $46.80 250400 ACH RETURN ITEM 19 $4.0000 $76.00 251052 ACH DEBIT/CREDIT BLOCK 1 $10.0000 $10.00 250610 DELETIONS/REVERSALS/CHANGES 3 $10.0000 $30.00 251070 ACH NOC ITEM 0 $1.0000 $0.00 250302 UNAUTHORIZED ACH RETURN ITEM 0 $5.0000 $0.00 251050 ACH POSITIVE PAY MONTHLY SERVICE 1 $10.0000 $10.00 250312 ACH FRAUD PROTECTION RETURNS 1 $3.0000 $3.00 999999 SAME DAY ACH ENTRIES 0 $0.5000 $0.00 110-Automated Clearinghouse Total: $472.56 120-Funds Transfer AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 350109 PINACLE BOOK TRANSFER 1 $2.0000 $2.00 350109 PINACLE DOMESTIC WIRE TRANSFER 23 $6.0000 $138.00 350300 INCOMING WIRE TRANSFER 1 $6.0000 $6.00 120-Funds Transfer Total: $146.00 130-Information AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 400222 PREVIOUS DAY ACCOUNT 1 $10.0000 $10.00 400225 CURRENT DAY ACCOUNT 2 $10.0000 $20.00 0-17848 Page 2 of 4 AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 350551 PINACLE TEMPLATE STORAGE 0 $0.5000 $0.00 40027Z PINACLE INFO REPORTING MONTHLY 1 $50.0300 S50.00 400271 PINACLE-PREV DAY TRANSACTION 1.756 $0.0300 S52.68 400274 PINACLE-CURRENT DAY TRANSACTION 1,588 $0.0300 $47.64 409999 PINACLE EVENT NOTIFCATION EMAIL 0 $0.0000 $0.00 409999 PINACLE OUTSTANDING CHECK REPORT 1 $10.0000 $10.00 999999 PINACLE ACCOUNT TRANSFER 0 $1.0000 $0.00 409999 PAYEE ACCOUNT VALIDATION MONTHLY 1 $10.0000 $10.00 409999 PINACLE MODULE FEES 5 $10.0000 $50.00 130-Information Total: $250.32 150-Investments AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 450020 MMDA SWEEP SERVICE 1 S100.0000 $100.00 150-Investments Total: $100.00 Fee Based Total: S2,442.60 Rate Based Fees Service Description Volume Unit Price/Rate Total Price Account Balance Fee $10,000,000 $0.1420 $1,420.00 Interest Bearing Account Balance Fee $0.0083 $0.00 Earnings Credit Allowance $10,000,000 1.500% $-12,328.77 Rate Based Total: S-10,908.77 Total Service Charge:$-8,466.17 Implementation Fees AFP Code Service Description Tiers Proposed Vol Unit Price Total Price 251000 ACH PIN ORIG IMPL 1 $0.0000 $0.00 251056 ACH FRAUD PROTECTION IMPL 1 $0.0000 $0.00 109999 REMOTE DEPOSIT DOS REMITTANCE IMPL 1 $0.0000 $0.00 359999 WIRE TXFR IMPL 1 $0.0000 $0.00 999999 PINACLE IMPL 1 $0.0000 $0.00 Implementation Fee Total:$0.00 This proposal is valid for 120 days.PNC Bank reserves the right to adjust the pricing quoted or processing parameters outlined if the proposal is accepted after the 120-day period.All prices quoted are in U.S.dollars.This pricing is for discussion purposes only and is not a contract,an offer to enter into a contract or a commitment to offer the pricing outlined herein.This pricing is delivered by PNC Bank on the condition that it be kept confidential and not be shown to or discussed with any third party,including any financial institution,or used other than for the purpose of evaluating PNC Bank's banking services.This proposal,including pricing,is delivered by PNC Bank on the condition that it be kept confidential. `The proposed unit price is an estimate for discussion purposes only based on tiered unit pricing and proposed volume;the actual unit price will vary based on tiered unit pricing and actual volume. Additional information on tiered unit pricing is available upon request. PNC Bank reserves the right to charge fees for services used but not quoted in this proposal,including but not limited to overdraft charges,negative earnings credits and late fees.PNC Bank's fee schedule is subject to change from time to time,and any future increases or decreases or changes in transaction code names,definitions or structures shall be applied to all accounts subject to these rates and categorizations.PNC Bank's rate information,including any ECR,in this proposal is an estimate for discussion purposes only and is subject to change from time to time. Compensating balance credits(if any)may be available to offset basic service charges. Compensating balance credits cannot be used to offset any amount advanced by the bank(including but not limited to postage and overdrafts),or certain other fees and charges(including but not limited to implementation fees and related development hours for TM Services,overdraft fees,interest,and third party fees). Account statements will display applicable credits,fees and charges. PNC is a registered mark of The PNC Financial Services Group,Inc.("PNC"). ©2023 The PNC Financial Services Group,Inc.All rights reserved. Q-17848 Page 3 of 4