This page provides an overview of banking requirements for local governments in Washington State, along with sample RFPs/agreements and links to best practices and list of authorized depositaries.

Overview

Cities and counties are required to bank with a qualified public depositary (RCW 39.58.080). In code cities, the bank is designated by the council (RCW 35A.40.030). In other classes of cities and counties, the statutes allow the treasurer to select the bank (RCW 35.38.010 and 36.29.020). Note that credit unions are public depositaries solely for the purpose of receiving deposits of no more than $250,000, the maximum deposit insured by the national credit union share insurance fund.

Cities and counties may pay for their banking services by direct charges for each service, by compensating balances (funds the bank holds on which it pays no interest), or a combination of the two.

Relevant Statutes

• RCW 39.58.080 - Deposit of public funds in public depositary required -- Deposits in institutions located outside the state
• RCW 35A.40.030 - Fiscal -- Depositaries
• RCW 35.38.010 - Designation of depositaries
• RCW 36.29.020 - Custodian of moneys -- Investment of funds not required for immediate expenditures -- Service fee
• RCW 39.58.010 (8) and (15) - Definitions
• RCW 39.58.240 - Credit union as public depositary -- Conditions

Examples of RFPs

To make certain that they are getting the services at a good price, local agencies should periodically do a request for proposals (RFP). Below are a few selected examples.

Cities

• Kirkland Banking Services RFP (2015) – Includes sample contract
• Liberty Lake Banking Services RFP (2013) – Includes sample contract
• Maple Valley Banking Services RFP (2013) – Includes sample contract
• Poulsbo Banking Services RFP (2017) – Includes sample professional services agreement
• Seattle Bank Depository Services RFP (2012)
• Stanwood Banking Services RFP (2017) – Includes sample contract
• Washougal Banking Services RFP (2016)

Counties

• Franklin County Banking Services RFP (2016)
• King County Banking Services RFP (2009)
• Skagit County Banking Services RFP (2015)
• Thurston County Banking Services RFP (2011)

Special Purpose Districts

• Mukilteo Water and Wastewater District Banking Services RFP (2011)
• Port of Port Angeles Banking Services RFP (2014)

Joint RFPs

• Clark County, Vancouver, and Port of Vancouver Banking Services RFP (2010) – Includes sample contract

Examples of Banking Agreements

Below are a couple examples of banking contracts. Some of the RFPs above also include sample banking contracts.

• Bonney Lake Banking Services Agreement (2014) – Includes resolution authorizing mayor to sign agreement
• Stanwood Banking Services Agreement and 1-Year Extension (2017) – Includes original three-year banking agreement, plus one-year extension

Recommended Resources

• WA State Treasurer: PDPC Banks – List of financial institutions currently authorized to accept public deposits
• Government Finance Officers Association (GFOA)
  • ​Banking Services: A Guide for Governments (2004) – Very detailed and informative publication discusses cash flows, core/ancillary banking services, and the procurement process. Older publication, but still timely and relevant.
  • Best Practices:
    • Bank Account Fraud Prevention
    • Payments Made by Governments
    • Procurement of Banking Services (2010)
    • Use of Lockbox Services
    • Using Remote Deposit Capture