Committee hears 5 Star Bank presentation on public money market account; agrees to seek Board direction

The committee heard from Reagan Ballo, senior vice president at 5 Star Bank, about the bank’s public money market account offering and operational details.

Ballo said 5 Star Bank is a full-service commercial bank headquartered in Sacramento that works with more than 135 public entity clients and holds over $500 million in public money market deposits for county clients statewide. He told the committee that Board approval would be required to open an account and that the county finance director (referred to during the meeting as Klaus) would sign the bank’s signature/contract documents on behalf of the county.

Ballo also described the account’s operational terms: the bank benchmarks its money market rate to LAIF’s published monthly yield and provided the bank’s current example rate to the committee as approximately 3.863%. When asked about minimums, Ballo confirmed the bank’s minimum to offset monthly maintenance was $25,000 and said the county could start with a nominal amount and grow the account over time.

Committee members asked whether the county should expand relationships with other banks (payroll and other services are held with institutions including US Bank and Bank of America) and raised concerns about merchant swipe and card-processing fees. The committee did not set a deposit percentage but agreed to include a recommended dollar amount in the Board item after consultation with Assistant Treasurer/Tax Collector Susan Lappin.

Next steps: after the Board considers the recommended investment policy amendment, staff will return to the Board with a second item to request direction on opening an account with 5 Star Bank.