BOE Approves Banks for Depository and Investments

The banks used by the Board of Education for investments and depositing funds will remain the same for the coming year.

Following questions from new BOE member Mitch Slater, the board voted unanimously on Tuesday evening to keep the list of banks the same with Valley National Bank serving as the school district's official depository of funds for the coming year. Eight banks were designated for investment purposes.

During a review of routine administrative resolutions approved by the board annually, Slater, who took the oath of office less than an hour before, asked about the selection of banks and the board's investment strategy. He was asking about the board's investment strategy and options in investing funds.

BOE Business Administrator Robert Berman explained that the board is limited by state law in what investment instruments are available.

"There are few investments we can invest in," Berman said. "We can do some certificates of deposit and some money market accounts."

Berman said the banks for investment purposes are selected on the best interest rates available. Noting the low interest rates currently, Berman said the practice of moving investments around and adding on new banks is not as prevalent as in past years. He said the eight banks were chosen in the past because of the best array of investment products for the board to choose from.

"When interest rates are better we can call them in and get the best interest rate," Berman said of the investment strategy.

The eight banks currently designated for investments are Bank of America, New Jersey Cash Management Program, Fidelity Investments, TD Bank, HSBC, Investors Savings Bank, Valley National Bank and Unity Bank. Berman also explained to Slater that the BOE changed from Bank of America to Valley National as the official depository last year through an RFP process.

Responding to a Slater question about exploring new banks for money market accounts, Berman said the board can do that in the future and his office researches new investment options for the board. He said that once the board adds a new bank to the list money can be moved into an account within 24 hours.