Ordinance No. 3,924U
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ORDINANCE NO. 3924
AN ORDINANCE SELECTING A CITY DEPOSITORY; AUK
THE MAYOR AND CITY CLERK TO EXECUTE AND ATTEST TO A
CONTRACT WITH THE SELECTED DEPOSITORY,; AND PROVIDM
FOR THE EFFECTIVE DATE HEREOF.
WHEREAS, pursuant to the provisions of TEX. REV. CIV. STAT, art. 2559,
the City of Baytown is authorized to receive applications for the custody of City
funds from any banking corporation, association, or individual banker doing business
within the City that may desire to be selected as depositary of the City; and
WHEREAS, notice that such applications would be received on the 13th day
of August, 1984, was published pursuant to TEX. REV. CIV. STAT. art 2559, on the
29th day of July, 1984, which is not less than one week nor more than four weeks
before such date and notice was personally given to each banking corporation in the
City of Baytown; and
WHEREAS, pursuant to TEX. REV. CIV. STAT. art. 2560, the governing body
is to select as depository the banking corporation, association, or individual banker
offering the most favorable terms and conditions for the handling of the City's
funds; and
WHEREAS, the City of Baytown did receive applications from banking
corporations, associations, and/or individual bankers doing business within the City to
serve as the depository of the City funds; and
WHEREAS, the City Council deems that Baytown State Bank has offered the
most favorable terms and conditions for the handling of such funds; NOW
THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS
Section 1: That the City Council hereby finds that Baytown State Bank of
Baytown has offered the most favorable terms and conditions for the handling of the
® City's funds.
Section 2: That Baytown State Bank of Baytown is elected as the
Depository of the City of Baytown, Texas, consistent with the terms and provisions
of its application. 'r
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Section 3: That the Mayor and City Clerk are hereby authorized to execute
aM attest to a contract with Baytown State Bank of Baytown, said contract setting
s forth -farms and conditions consistent with the application that was submitted The
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DEPOSITORY CONTRACT
CITY OF BAYTOM
THE STATE OF TEXAS
CO NTY OF PARR IS
This Contract and Agreement is made and entered into by and
between the City of Baytown, a municipal corporation, hereinafter
sometimes referred to as the "City ", located in the County of
Harris., State of Texas, and Baytown State Bank of Baytown
hereinafter called "Bank" or "Depository Bank".
W I T N E S SETH :
WHEREAS, bids were received in response to an Invitation to
Bid on Depository Contract for the City of Baytown; and
WHEREAS, Baytown State Bank of Baytown was duly selected,
qualified, and designated as Depository Bank for the deposits of
the City, to serve in such capacity for the term comnencing on
the 1st day of October 1984, and ending on the 30th day of
September, 1986.
NOW THEREFORE, it is agreed by the parties hereto, as
follows:
1. That pursuant to the action taken by the City
on the 23rd day of August, 1984, Baytown State Bank
is selected and designated as Depository Bank of
the City, for the period from the 1st day of
October, 1984, to the 30th day of September, 1986,
and thereafter until the successor depository shall
have been duly selected and qualified according to
• law.
2. That in consideration of said selection as
Depository Bank, the said Depository Bank covenants
and agrees to faithfully perform all of the duties
thereof, as provided by the laws of the State of
Texas and will safely keep and faithfully disperse
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all funds coming into it as depository, and
faithfully pay over to the successor, all funds
t remaining in the depository, and does guarantee and
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` -, indemnify the City against all lose, cost or
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expense, including a reasonable attorney's fee,
arising out of or related to the failure to perform
duties imposed by law or this Contract.
The term "funds" shall be considered to mean
all cash, securities and investments, sinking
funds, trust funds, and other funds or assets that
may come into the possession of said Bank.
3. Bank states that it is a banking institution
chartered under the laws of the United States or of
the State of Texas.
4. The Depository Bank agrees to pay to the City
of Baytown interest on time deposits of $100,000.00
- or more at a rate equal to the interest rate for
U.S. Treasury Bills of like maturity, +.25
percentage points. , The interest rate for U. S.
Treasury Bills to be used in determining the total
interest rate shall be the rate for treasury bills
at the close of business on the previous day as
published in the "yield" column under Treasury
Issues in the WALL STREET JOURNAL; and such rate
shall remain in effect until 4:00 p.m. of the day
it is published. The total interest rate to be
paid on each time deposit will be determined on the
deposit date and will remain unchanged for the term
of that deposit. Calculation of interest shall be
made on a 360 -day simple interest basis and shall
be paid on each time deposit upon maturity.
5. No time deposit that carries a maturity date
beyond the date prescribed for termination of the
contract will be placed with the Bank; however, in
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the event time deposits shall mature subsequent to
ky the date of the termination of the contract, all
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deposits previously invested may, at the election
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' of the City, remain on deposit until maturitv.
6. The Bank shall furnish monthly statements or
statements at other special intervals as requested
by the City or its designated accountant and /or
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auditor, showing the debits and credits and balance
in each account on depusit. The postings to each
account shall be an individual posting of each
rk debit and credit and other matters of banking
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routine shall be handled in a manner satisfactory
to the City. The Bank also agrees to provide the
#=` following services free of charge:
(a) Night depository service, including keys and
bags,
(b) Safety deposit box service;
(c) Coin wrappers and money straps;
(d) Certified and /or cashier's checks;
(e) Checks of type, quality and quantity specified by
the City;
(f) Coded form deposit slips; and
(g) Wire transfers.
7. The Bank shall pledge to the City with a bank of
safekeeping (Trustee Bank), acceptable to the City,
"approved securities" in an amount (based on current
market value, not per value) sufficient to adequately
® protect the funds of the City deposited with said Bank.
Securities shall be accepted at their current market
value, and total securities pledged shall have market
value of not less than One Hundred Percent (100 %) of
the funds secured at all times. Should the value of
the securities pledged ever be less than One Hundred
Percent (100%) of the finds secured, the Bank, within
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five (5) days of notice of said default, shall cause
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additional securities to be deposited in such amounts
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as to restore the total securities pledged to One
Hundred Percent (100x) of the funds secured. The Bank
shall have the right and privilege of substituting
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approved securities upon obtaining the written approval
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of the City, which shall not be unreasonably withheld.
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The term "a "
"approved securities as used herein shall
mean and include direct obligations of the United
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States of America, bonds of any agency of the United
States which are unconditionally guaranteed as to
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principal and interest by the United States, bonds of
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the State of Texas or of any county, school district,
city or town of the State of Texas that have been rated
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"A" or a better by Moody's Investors Service and that
mature in less than ten (10) years from the date
pledged, or other securities provided by Texas Revised
Civil Statute, art. 2560(d). The City must approve all
securities prior to their being pledged. The City may
use as many as five (5) days for the approval of said
substitution. The Bank will execute a safekeeping
agreement, in a form as attached hereto and marked
Exhibit "A ". Securities may only be released from the
banking institution holding said securities in
safekeeping (Trustee Bank), by a release in a form
which shall be provided by the City.
S. In the event the City shall desire to convert a
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part or all of the public funds invested under this
Contract, to demand depo•si is or to cash, the Bank
agrees to make such funds available without delay,
subject to regulations imposed by appropriate bank
regulatory authorities; and the City agrees that upon
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payment of the funds to the City, it shall provide a
release of the bonds or securities in an amount
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proportionate to the funds .withdrawn, subsequent to
said withdrawal, after said funds have been credited or
cashier's checks issued thereon have been duly paid.
9. In the event the City shall deposit pu5Iic funds
With the Bank which would exceed the reasonable market
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value of the securities pledged by the Bank, then the
undersigned Bank agrees, within forty -eight (48) hours
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thereafter, to deliver to the Finance Director of the
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City, in the form provided by the City, a list of
additional securities that are to be deposited with the
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Trustee Bank. In the event the sum on deposit with the
Bank is reduced to less than the bonds on deposit with
the Trustee Bank, the City does agree to release such
excess bonds on deposit with the Trustee Bank, by the
Finance Director of the City
y noti ying the Trustee
Bank, in writing, of the agreement to release such
bonds, and in the appropriate amount.
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10. The Bank covenants and agrees that the Finance
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Director of the City shall not be required nor
requested to execute a release of bonds held on deposit
pursuant to the Safekeeping Agreement unless a bona
fide exchange of collateral bonds has been approved by
the Finance Director of the City or until such time as
all monies, including principal and interest secured by
the deposit of bonds in the Trustee Bank, have been
paid to the City and a copy of the cashier's check
dated not more than thirty (30) days prior to the date
of such release, duly endorsed by the Finance Director
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of the City and cancelled, has been attached and made a
part of the release of the City. In addition, the
Finance Director of the City shall release.any excess
collateral upon request by the Bank.
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: stated herein.
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12. The Bank certifies that it is not disqualified
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from bidding and becoming the depository for the City
by reason of one or more of its officers, directors,
and stockholders who own more than 10 percent of the
bank's outstanding capital stock being on the City
Council of the City of Baytown, and further that no
officer, director or stockholder voted or participated
in the proceedings whereby the Bank was selected as
® depository.
13. The Parties covenant and agree that the Bank shall
be the sole and single depository of the City for the
term of the Contract, and the City shall not maintain
time or demand accounts (other than bond interest and
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11. The Bank covenants and egrees that in the event
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any of the terms, covenants, r.; cnadit °Ons of the bid
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document, this Contract document, or the Safekeeping
Agreement, are in any way t•reached or violated or for
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any reason the Bank has failed to perform under the
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terms and conditions of said documents and /or
agreements, the City reserves the right to terminate
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this Contract or any agreement entered into subsequent
to or by reason of the bid previously submitted by the
Bank and shall have the option of withdrawing time
deposits from the Bank, including principal and accrued
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interest, or in the alternative to allow said funds to
remain on deposit until maturity. Failure by the City
at any time or instance to exercise any of its rights
under the terms, covenants, or conditions of the bid
documents, this Contract document, or the Safekeeping
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Agreement shall not constitute or be construed to
constitute a waiver of any of the City's rights
as
: stated herein.
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12. The Bank certifies that it is not disqualified
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from bidding and becoming the depository for the City
by reason of one or more of its officers, directors,
and stockholders who own more than 10 percent of the
bank's outstanding capital stock being on the City
Council of the City of Baytown, and further that no
officer, director or stockholder voted or participated
in the proceedings whereby the Bank was selected as
® depository.
13. The Parties covenant and agree that the Bank shall
be the sole and single depository of the City for the
term of the Contract, and the City shall not maintain
time or demand accounts (other than bond interest and
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P. HALL, Ci ty C erk
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sinking fund accounts) in any other financial
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ins titution. The City may, however, invest funds in
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direct debt securities of the United States.
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IN WITNESS VA-EREOF, witness the signature of the President
of Baytown State Bank (Bank) as attested to by its Secretary, and
t'he Mayor of the City of Baytown as attested to by its City
Clerk, :n duplicate, on this, the day of
,
1984.
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President
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ATTEST:.
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Secretary
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CITY OF BAYTOMN
By:
Mayor
ATTEST:
P. HALL, Ci ty C erk
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TRUSTEE BASK
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The Undersigned, being a duly qualified and acting officer
of the undersigned Bank, acting for and on behalf of said Bank,
does hereby deposit with the above named Trustee banking in-
stitution, the bearer bonds set out on the Schedule of Bonds
attached hereto.
You are instructed that the bonds deposited with you are
deposited pursuant to an agreement to deposit public funds with
the undersigned Bank by the City of Baytown (City).
It is agreed and understood that you are to release these
bonds only upon the written authorization of the undersigned Bank
and the City by an appropriate release, in a form as attached
hereto. However, in the event the undersigned Bank shall fail
and /or _refuse to pay, upon written demand and notice given at
least twenty four (24). hours before the date any time deposits on
deposit with the undersigned Bank by the City are due, you are
instructed and authorized to deliver to the Finance Director of
the City, all bonds and /or securities deposited hereunder without
further authorization, release or direction by the undersigned
Bank, so long as you shall be furnished a certified copy of a
resolution duly enacted by the City Council of the City of
Baytown, which resolution shall provide:
1. That written notice and demand for payment had been made
twenty -four (24) hours prior to the date time deposits on
deposit with the undersigned'Bank, were due.
2. That a release of bonds on deposit with your bank had
been furnished to the undersigned Bank in a form as attached
hereto, at least twenty -four (24) hours prior to the enact-
ment of such order.
3. That the undersigned Bank has refused and /or failed to
pay to the City time deposits then due.
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4. That a certified copy of said order has been delivered
to the undersigned Bank, at least one (1) hour prior to its
presentment to the Trustee Bank for reiease of the bonds or
securities deposited hereunder.
In executing this Safekeeping 9 s ping Agreement, the undersigned
Bank..does agree to be bound by the provisions herein, and does
hereby release and forever discharge the above named Trustee Bank
..any liability for the release of the said bonds to the
21i ?FInonce Director of the CI t of
Baytown, as herein specified.
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SIGNM and DWUJTM this the day of , 7984.
ATTEST:
DHIB1T A
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PAUM RELEASE OF IM
Cl IV OF WNW—
The undersigned Finance Director of the City of Baytown
- hereby authorizes the Bank to
release the securities identified by the list attached hereto
pursuant to the Safekeeping Agreement with said
Bank because (a) the
Bank has paid to the City monies in
the amount of
previously held on deposit; (b) here has been a substitution of
collateral and a list of the substituted collateral is attached
hereto; or (c) there is excess collateral pledged as security.
Signed this the day of , 1984.
Finance Director o t e
City of Baytown
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