Corry Federal Credit Union CFO Kelly Soety was in attendance at Monday's Corry City Council meeting to ask Council members why the credit union was not considered for the city's official banking service in light of the closing of PNC bank, where the city currently does business.
The Corry branch of PNC Bank will be closing on Feb. 21 at 3 p.m.
In an article in the Feb. 3 edition of The Corry Journal it was reported the city considered four other options and none of them were credit unions.
At Thursday's Council planning session, City Manager Jason Biondi and City Business Manager Nick Heil recommended First National Bank due to proximity and, since the city has accounts that require a daily deposit, Council members agreed.
“We saw in the paper today that there was going to be a vote on who the city will be looking at for banking partners, as PNC is closing," Soety said. "At the credit union, we were just curious why the credit union was not considered."
CFCU's CEO Stacey Heiser said in an interview she contacted Biondi via email when it became known PNC is closing to offer the credit union's services to the city but never heard back.
Corry Mayor Dave Mitchell said he was not made aware of any communication from CFCU.
Biondi said in the Council meeting there was no particular reason why the city didn’t look at the credit union, however, the question was addressed more directly later in the meeting when the agenda item came up for discussion and vote.
“What are the rules governing transactions like this?” Councilman Bill Roche asked. “Are we required to shop publicly?”
City Solicitor Paul Carney said since this was public services, the city could handle it however it wanted and did not need to put out a public notice for bids.
City officials asked for proposals and considered First National Bank, KeyBank, Northwest Bank, as well as the option to maintain the relationship with PNC Bank but at another branch, and found little difference in their services.
“The only thing we need to check is whether we are allowed to do it with city funds and taxpayers funds, whether they are able to be deposited,” Biondi said. “There are rules around where we can bank, how they have to be structured, so we have to take a look at that.”
Third class city law regulates how a city can bank.
Corry Mayor Dave Mitchell said that historically, credit unions did not do business like this because it was a closed organization and limited who was able to hold accounts with them.
Mitchell went on to recognize with the broadening of the capacity of credit unions, it gives the city new information to consider.
“Off the top of my head, I’m not sure either," Carney said. "I assumed that in order to deposit funds you have to be a member. Can the city become a member?”
Soety confirmed that the city could become a member.
“By the 20th of February, we have to have everything switched over,” Biondi said.
While the next Council planning session is Feb. 13 and the next Council meeting is Feb. 17, Biondi said it takes several days to set up and transfer accounts plus order checks. Limiting the transfer to three days was not feasible for city operations.
Though Roche made a motion and Councilman Drew Sproveri seconded it to table the issue, Carney advised to vote on a bank and research alternate banks afterward as a contract was not involved.
“We can technically change it anytime, so we could still hear their proposal,” Heil said.
Council voted and approved First National Bank, but asked Soety if CFCU could meet to discuss options.
A meeting with CFCU has been set up for today.
Biondi said he conducted further research with city auditors to confirm the legalities of working with a credit union.