Town studies direct deposit
Published 12:00 am Wednesday, December 10, 2003
MURFREESBORO – After being sworn in by Magistrate Patricia Shearn, Murfreesboro Mayor Ben McLean and other members of Town Council heard a presentation by RBC Centura regarding the potential benefits of switching town employees to direct deposit in place of paper issued checks.
According to Treasury Management Services Officer Mike Dacko, a representative from RBC, switching to direct deposit would reduce the cost expended by issuing paper checks while providing convenient services to town employees at no cost.
&uot;Moving your payroll exclusively to direct deposit would be more cost effective as well as offer services of convenience to employees,&uot; said Dacko.
Having wages deposited electronically would eliminate the time and process of an employee waiting to receive a check, driving to the bank, waiting in line and filling out a deposit slip. With direct deposit, wages would be deposited into an employee’s checking account on a predetermined date by a certain time and allow the employee the freedom to access his or her account online at no cost.
Town Administrator Molly Eubank began discussing ways in which the town could maintain ease in the area of cash management with RBC representatives near the end of November.
RBC Centura, which is a member of the RBC Financial Group, is the tenth largest financial service company in North America and works closely with RBC Dain Raucher and Voyager Asset Management, one of the largest full service securities firms in the US.
RBC Dain Raucher is also the leading investment bank ranking within the top three in senior managed and co-managed issuance by number of transactions, with respect to the public sector.
&uot;We realize that each client has unique needs that require a specific approach to their financial management,&uot; said Account Manager Jim Hansen for the Public Sector Group at RBC. Hansen primarily handles accounts east of I-95 and stated, &uot;RBC is equipped to handle everything from small towns and municipalities to larger city governments and has experience dealing with a variety of clients making us one of the top providers of public sector services in the Southeast.&uot;
Hansen cited examples of currently good working relationships with Northampton County’s Finance Officer, Dot Vick, in Jackson, the lending side of Halifax County and a recent feat to assist Wake County in financing two police cars.
In transitioning from paper to electronic payroll, employees would yield a variety of banking benefits including no-fee checking, unlimited check writing, phone and teller transactions, free use of any bank’s ATM, secure online access to accounts 24/7 for checking balances and transactions, transferring funds or paying bills online.
The package would allow employees to use Pocket Check Debit/ATM card for convenience in everyday purchases used wherever Visa is accepted. It would also offer overdraft protection.
Eubank inquired on behalf of town employees if they would be required to bank with RBC or have the option to choose a different banking institution and if there would be any penalty to the employee should they choose to do so.
RBC Account Manager Deborah Earley explained that employees would have the freedom to bank with another financial institution without penalty while still using their service, but that, &uot;the key is for the town employees to go to direct deposit in order to ensure cost effectiveness.&uot; She also added that, with respect to the employees, the company would still like the opportunity to share the benefits of banking with RBC.
She stated that although it would be possible to give employees the choice to opt out of participating in direct deposit, the decision to maintain both payroll practices would not be cost or space effective as the town would have to maintain storage for paper checks while having to query manually for some and electronically for others, making the process more confusing rather than easier.
If the town goes to electronic deposit, checks would be imaged onto a CD Rom, making it easier to reference payroll information while requiring less storage space.
No decision has been made, but options will continue to be discussed.