The city of Ashland has renewed its banking services contract with Bank of America, despite a push by some residents to use a more locally owned bank.
The city of Ashland renewed its banking services contract with Bank of America, despite a push by some residents to use a more locally owned bank.
After the near-collapse of the financial system in fall 2008, many Americans became frustrated by what they viewed as risky financial behavior on the part of some national banks. Many people joined a movement to pull their money from big banks and open accounts with ones that are locally owned.
Many Americans were also bothered by bail-outs of financial firms that were deemed "too big to fail."
Those sentiments flared up again in Ashland in February when the city government began seeking sealed bids from banks to provide banking services.
The city of Ashland has been using Bank of America, a national bank, for the past five years. Another national bank, US Bank, provided services to the city for almost three decades before that.
When the bids were recently unsealed, Bank of America beat out five other banks when it came to cost.
Bank of America also came in first place when it came to quality of services.
Four national banks, along with Umpqua Bank, which serves the West Coast, and Sterling Savings Bank, which serves several western states, vied for the city's business.
Umpqua Bank came in fourth place on quality of services and cost, while Sterling Savings Bank was last in those categories.
Some Ashland City Councilors said they wished they could use a more local bank, but councilors voted unanimously on June 15 to renew the city's contract with Bank of America.
The new contract is for three years beginning on June 30, with the possibility of two one-year extensions. Bank of America will charge the city of Ashland $1,025 per month.
"There were a lot of folks who said, 'Let's use a local bank,'" Councilor David Chapman said.
But he said he made his choice to go with Bank of America based on cost.
City Recorder and Treasurer Barbara Christensen said the city can't show favoritism to a locally owned bank. It has to choose the bank that offers quality services at the best price.
The city of Ashland requires that the bank that serves the city government have a bank branch in town, and Bank of America does have an Ashland branch, she said.
Bank of America handles a range of financial chores for the city of Ashland, such as providing direct deposit for employees' payroll checks and processing electronic utility bill payments.
On May 18, the Ashland City Council unanimously approved a new ordinance with language that states the city will endeavor to use local suppliers of materials and services while seeking the lowest responsible bid.
Staff writer Vickie Aldous can be reached at 541-479-8199 or firstname.lastname@example.org.