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Council hears pitch to consolidate city deposits using IntraFi-style sweep; no formal vote
Summary
Staff and a bank representative described a proposal to move municipal deposits into a Bank of Charles Town account that would use an IntraFi/ICS network to spread funds across institutions, increase interest (to about 1.7%) and provide expanded online and check‑deposit services; council raised questions about policy and legal checks but voiced no formal objection to exploring the option further.
City staff and a bank representative briefed the council on a proposal to consolidate municipal deposits into a single bank account that participates in an IntraFi/ICS program to spread balances across multiple banks and increase FDIC‑insured coverage.
The representative described an "IntraFi Cash Sweeps" or ICS approach that pools deposits among participating banks so the city would receive FDIC limits across multiple institutions while the city keeps a single banking relationship and gains online services such as remote check scanning. The representative said the effective interest rate for the city under the program would be roughly 1.7 percent and that the program could protect very large balances — a figure cited in the presentation was an ability to "cover up to $190,000,000 per customer" when using the network of participating banks.
Council asked whether the city’s financial policies must be revised to authorize this account type and whether state legal requirements for municipal custody of funds would be met. Staff said they would verify policy compatibility and legal constraints and undertake references and due diligence; the mayor asked staff to check city finance policy and state rules. No formal vote was taken; the mayor asked if there were objections to moving forward with further review and none were voiced.
Why it matters: Consolidating deposits and using an insurance‑sweep product could raise the city’s average yield on idle cash and reduce the administrative time needed to manage multiple bank relationships, but it requires legal vetting and an operational change to reconcile statewide requirements and local financial policy.
What’s next: Staff will verify legal compatibility, review policy language, and return with a recommendation and proposed contract terms before any account changes are made.
