STILLWATER, Okla. —
Payne County is losing money because BancFirst has started charging fees for the $35 million the county has in two accounts at the bank.
The county could lose up to $700 a month, County Treasurer Bonita Stadler said.
“It boils down to the fact that we will not earn enough money on the interest accrued to pay for the charges they’re going to charge us,” Stadler.
Tuesday, the Payne County Budget Board unanimously approved using $1,000 a month from the county’s general fund to offset those fees until June.
Stadler said she is seeking proposals from other banks to see if the county can earn better interest rates or be charged no fees or lower fees.
The county has two accounts at BancFirst, Stadler said. The general government account has been with BancFirst for as long as she has worked for the county, which is more than 25 years, Stadler said. Another account has been with the bank approximately six years.
Stadler said bank officials told her they didn’t want to lose the county’s account, but would have to charge fees because of low interest rates.
“All these years we’ve had you (bank) with us without charging us, now we’re gonna have to charge you,” Stadler said the banker told her.
Stadler said bank officials have told her the most they could pay is a .01 percent interest rate.
Stadler said government accounts are not like an average customer’s accounts. The Federal Deposit Insurance Corp. insures deposits up to $250,000. If a customer, like a county, has a larger account, banks often use Treasury Bonds or certificates of deposit as collateral for the investment.
Eileen King, president of the National Association of County Treasurers and Financial Officers, said county treasurers generally seek bids for banks for county funds every six years.
King is the county treasurer for Riley County, Kan.
She said investment policy is largely left up to the county treasurer in Kansas. If an investment is working, it is renewed.
Stadler said there’s no rule in which a county needs to seek proposals from banks if an investment is working. Changing banks is expensive.
Jim Fain, Oklahoma State University professor of economics, said interest rates are low because the Federal Reserve is holding them down.
“What we have been doing to stimulate the economy is to increase money supply (to) drive interest rates down, and that’s why interest rates are low,” Fain said.
Stadler has said she wanted to bring the matter to the attention of Budget Board members.
She said she is contacting banks to have them present possible proposals.
“In the meantime, I’m beating the bushes, scrambling with everybody I can find that might get us a better option for our investments,” Stadler said.