1. Account Structure The Township is interested in assuring that all funds are continuously earning at the best, then-current interest rates. The Township is not currently using a ZBA account structure for an automated daily sweep but will consider and may institute such a structure under the contract using a master account sweep to a money market mutual fund thereby eliminating any balance-based fee. The Township requires the option to pay for services on a fee or compensating balance basis. If used, an SEC registered government money market fund which strives to maintain a $1 NAV will be used for the sweep and must be rated AAA by at least one nationally recognized rating service. If the bank has a valid alternative to an SEC money market fund which is in compliance with the Township’s Investment Policy, it may be presented. Neither a repurchase agreement nor an off-shore account is acceptable as a sweep investment vehicle. a. Fully describe the bank’s ability to create a daily sweep account structure using an external money market mutual fund. b. In a sweep structure what charges are applicable for the master and subsidiary accounts? c. If the bank is proposing an alternative to a daily external sweep, such as an indexed interest-bearing account, detail and describe fully. d. Describe how sweep transactions and interest will be reported on a monthly report or online daily. Will daily activity reports show balance amounts and interest earned? Provide a sample report. e. Provide the full name and cusip for the SEC registered money market fund to be utilized for the sweep. f. Are funds swept at end of day or next day? If next day, how are funds maintained, invested and collateralized over-night? g. Does the bank charge a balance-based fee? At what specific rate? How is it computed? h. Confirm that the Township may use either a fee basis or compensating balance basis. i. Under a compensating balance basis what target balance would you assume would be required under your proposed service fee structure? j. Do interest-bearing accounts earn at a bank managed rate or is the rate indexed? k. Does the bank restrict withdrawals on a money market account to six per month?
