Travis County Commissioners Court
February 5, 2008
Item 31
Quickly, let's move to 31, consider and take appropriate action on amendment 3 to the current depository bank contract between jm morgan chase and Travis County.
>> od morning, marry the Travis County investment manager I have with me the director of the managent and co mmunications resourc department and two representatives from our depository bank, lenore calm as and kathy power. The recommendation today has really been a collaboration between cash investment management and records management, the bank, and the district clerk. As part of the backup, we do have a memo from the district clerk. We may have a representatives from them to join us. This amendment, this is presented as the third amendment to our bang depository contract. It sets forth the terms and continues to proceed with a project to use bank service credits, our earnings credits for a new document management service that the bank has recently made available, all banks have a huge document management section. And chase has simply decided to allow members of the public other clients, to use that. And this has come at a time when we have excess earnings credit. You will remember that the earnings credits are given to all commercial customers of banks as part of the billing process, and they represent, it's a return on deposits other than the direct interest that we get on some of our deposits and it can be used only for bank services. So since we had an excess of these earnings credits, we thought perhaps we could take advantage of this new service. It will involve converting roughly 16,000 boxes of permanent and semipermanent district clerk paper case files to electronic documents. I want to point out that at the moment, it looks like we have plenty of earnings credits to pay for the entire project. However, in times of declining interest rates, the formulas which provide those earnings credits do change. And it may be that at some time during the rest of had con--this contract, which goes through July 1 of '09, that we will not have enough. Our estimates will be wrong and we won't have enough extra earnings credits to fund this project. In
>> [ph] that case we would reduce the scope of it, go back to plan a, which has doing this on it own . We would not endanger the other bank servicesel we will not, hopefully, use our earnings credits because if we did, then we would actually have to pay the bank for bang services. So we'll be striving to avoid that. And I’d like for steven to talk to you about how this service will benefit Travis County.
>> let me ask you a question. What you just said sparked my curiosity. In the event, I do think most of us think that interest rates may go down even morement given the fact our income off our interest is certainly going to diminish or the last few years, and given the fact we could do this in house, go back to plan a, why wouldn't we err on the side of saying let's go to a right new and let's , you know, could it in house. I mean, what would be unsound about that?
>> well, nothing. But if we ended the contract and we had not utilized all of our earnings credits, then that would represent a loss to Travis County because we wouldn't necessarily guess anything for those soft dollars. They can only be used to purchase bank services.
>> is that kind of like a sale where you kind of go, we ought to buy more toilet paper because it's on sale, knowing that you have more than you need now? What net loss is it truly to us? And if there is one, let's identify that. Because is that a paper loss or is it on the credits? Because if you lose a credit, you're not, are you losing actual money out of the account? Versus--
>> no.
>> .
>> --just losing credit.
>> it's just soft dollars.
>> that's something we need to understandright. But we are not doing additional services. We're not proposingment --proposing. These are services that Travis County would be paid for with real dollars.
>> right.
>> this is a pretty large project that we are talking b even if part of it was completed we would still win. We are talking about 30 million images on our work plan for fiscal year '09 and 10. With this we get it done much quicker.
>> as opposed to in house.
>> exactly.
>> that's the answer that I was looking for.
>> so the bank has huge imaging capacity. And you all can take on this additional obligation with your bank work also.
>> yessomebody will monitor the use of our credit so if we start running short we will know to slow down the pace.
>> that's correct . Harvey is here. If you have any questions.
>> looks too good to be true.
>> almost does.
>> I’m glad we got to talk about us because until you got it out and understand it and I didn't until you told me the factor that if we don't, then we're not going to get near the capacity that we have. And the fact had a we can take care of that with credits, I mean.
>> is it like earned long distance telephone minutes, either you use them or lose them?
>> very similar.
>> this is true.
>> if we lose these, you also have to do the work and pay hard dollars for them. The loss is really in the hard dollars you have to pay to do the work when you could have paid for them in soft dollars.
>> telephone minutes go to another company.
>> we don't have that.
>> good analogy.
>> excellent.
>> move approval. Did we get a second? Discussion? More discussion? All in favor. Show Commissioners eckhardt, Gomez, Daugherty, yours truly voting
>> [ph] --in favor.
>> thank you all very much. Did we give you a chance to say enough?
>> you did.
>> thank you.
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Last Modified:
Wednesday, February 6, 2008 8:09 PM