Revised: December 17, 1997

I. Background

The selection of financial institutions as public depositories by state agencies and others designated as public depositors is governed by Chapter 34 of the Wisconsin Statutes. The Depository Selection Board created by s. 15.105(3), established guidelines and procedures for the procurement of banking services. These procedures require that, to the extent possible, the current contracted state working bank be used for all services including, but not limited to, lock boxes, credit card services, electronic transfer services, contingent and petty cash checking and deposit accounts.

Signature authority over accounts established at these public depositories is also governed by State Statute. In accordance with sections 34.01(7), 34.105(2) and 66.042(6), the Board of Regents of the University of Wisconsin System must designate by written authorization the person or persons who are authorized to make deposits to and sign checks drawn on accounts held in public depositories. In order to simplify the signature authorization procedure, the Board of Regents passed a resolution on September 19, 1969, empowering the Vice President and Controller of the University of Wisconsin System to authorize the persons who have signature authority on these accounts. The Secretary of the Board of Regents then submits to the public depository certification that the designated persons have signature authority.

II. Constraints

Chapters 34 and 66 of the Wisconsin Statutes

Guidelines and procedures established by the Depository Selection Board

PRO-I-6 of the State Procurement Manual – Contracting for Banking Services

Board of Regent Resolution dated September 19, 1969

III. Definitions

Section 34.01(4), Wis. Stats., defines public depositor to include “…the state…or any commission, committee, board or officer of any governmental subdivision of the state….” The institutions that comprise the University of Wisconsin System are, therefore, public depositors and must comply with the provisions of sections 34.045 and 34.05 with respect to public deposits. Section 34.01(3) defines public deposit as “public moneys deposited by a public depositor in a public depository, including private moneys held in trust by a public officer.” Financial institutions are eligible to be designated as public depositories. In accordance with s. 34.09, the following financial institutions are eligible to be designated as public depositories: state banks, federal or state credit unions, federal or state savings and loan associations, etc.

IV. Policy

A. Selecting a Public Depository

  1. PRO-I-6 of the State Procurement Manual requires that contract proposals for new banking services be submitted to the Depository Selection Board for review prior to bidding. These proposals must first be reviewed by the Vice President for Finance or designee who will forward them to the Depository Selection Board. DOA Form 2571 which is an attachment to PRO-I-6, should be used for this process. This process need not be followed for expanded accounts or minor changes in services within an existing contract.
  2. Upon approval of the Depository Selection Board, the proposal shall be submitted to selected financial institutions for competitive bidding.
  3. The UW institution is to make its selection based on an appropriately detailed analysis of the costs and benefits of each bid.
  4. The UW institution then submits its recommendation to System Administration, Financial Administration for review. This recommendation must include the information noted in IV.B.5. below. The recommendation will be forwarded to the Depository Selection Board for final review and approval.

B. Designating a Public Depository

  1. Designation of a public depository is required for all university accounts in which public deposits, as defined by s. 34.01(3), are made.
  2.  UW institutions must first give consideration to use of the State working bank contracted by the Depository Selection Board for all banking services. Exceptions require the approval of the Depository Selection Board.
  3. A financial institution becomes a UW public depository only upon the affirmative review and approval of the Board of Regents and the Depository Selection Board. Accounts for the deposit and withdrawal of public monies may not be established in a financial institution that has not received these approvals.
  4. Once designated as a UW public depository, a financial institution will retain that status until the Board of Regents and/or the Depository Selection Board rescind such status or the financial institution no longer meets the State qualifications of public depository.
  5. When an account is to be established at a financial institution that has not been designated a public depository, the institution must submit to System Administration, Financial Administration detailed information about the account activity, the services the financial institution will provide and the cost of such services, with its request for approval of the financial institution as a public depository. Costs shall be compared to the state working bank contract for reasonableness.

C. Signature Authorization

  1. Requests for approval of signature authority shall be submitted to the Associate Vice President for Financial Administration for review and transmittal to the Secretary of the Board of Regents for certification. The request shall stipulate the account title and number, the public depository and the person(s) who are to have signature authority. Signature cards for all persons who will be authorized to sign on the account shall accompany the letter.
  2. Appointment of signature authority shall be for an indefinite period unless the UW institution stipulates a specific period in its request for approval of signature authority.
  3. If an individual is deleted from the list of authorized signers and not replaced, the UW institution is not required to seek approval of System Administration. The UW institution will, however, be required to notify the financial institution of the change.
  4. The Institution Business Representative or designee shall maintain a file of individuals who currently have signature authority on state accounts held in public depositories.

V. Compliance

The UW Institution Internal Auditor shall conduct a periodic review of the file of individuals who have signature authority to ensure that it has been properly maintained. As part of the annual financial report preparation cycle, each institution must provide System Administration, Financial Administration with a list of all bank accounts, including the account name, number and the name of all authorized signatories for that account.