The status of banking on the Emporia State University campus was pushed into limbo this week when the Division of Purchases of the Kansas Department of Administration found that the wrong statute had been applied in determining that Marion National Bank would take over banking at the Memorial Union on campus.
The bank announced in an article on July 24 that it would assume banking duties for ESU students when the university’s contract with Lyon County State Bank ended on Dec. 31 of this year.
Lyon County State Bank filed a protest over the way the process had been handled, claiming that state statute had not been followed.
“The current vendor had issues,” said Gavin Young, spokesman for the Kansas State Department of Administration.
“One of the things that they had cited was incorrect application” of state statute governing the contract process.
“The Division of Purchasing reviewed the protest and found that (the protest) was correct,” Young said.
A statute governs the type of Procurement Negotiating Committee that is to be convened for financial institution contracts.
“That was not the type of procurement committee that was convened for this contract. It was a statutory error,” Young said.
The bidding process had begun early this year, when university officials filed a Request for Proposal for bids to provide banking services to ESU students. The in-house bank then becomes the official depository for student financial aid and can become the bank of choice for students during their stay in Emporia.
The bid for the new contract appeared to have been won by Marion National Bank, and a letter of intent had been issued. Negotiating the fine points of the contract were under way.
“I don’t believe an actual contract had been (signed),” Young said.
The state’s acceptance of Lyon County State Bank’s protest as valid pushed on-campus banking into limbo, at least for the time being.
ESU President Michael Lane said that the university will talk with students before making any decisions about future banking at the Memorial Union.
“We just learned of the whole situation earlier this week and we want to take a look at what our students really want and need in banking services, so we’re going to take a little bit of time to figure out what we need that will be in their best interests,” Lane said.
He had been surprised that the protest had been filed, and that the wrong type of committee had been convened during the process, which had been as joint effort of the university and the Division of Purchasing.
“What happened is we submitted the RFP under the general bid provisions that are under state statute,” Lane said, translating his understanding of the situation into layman’s terms. “There is another state statute that governs acquisitions of (financial services.) It’s never been used in the past by any other financial institution, nor has it ever been used here. We believed when we submitted it we were doing it under the appropriate statute.”
The initial RFP process had been time-consuming, he said, and a second request for proposals and bid-letting cannot possibly be completed before Dec. 31, when Lyon County State Bank’s contract ends.
“If you consider the RFP that was just invalidated was sent out in January or early February, the time frames just don’t exist” to complete another full bid process, Lane said. “There are no ‘grandfather’ provisions of which I am aware in the state purchasing system.”
Lane could not at this point predict whether the current bank would be able to continue operating until the situation is settled, or whether it would have to vacate the Memorial Union premises by Jan. 1.
“We will meet with students or in some manner collect their input in the process,” Lane said. “... We’re going to take the time that we need to take to do that properly. That’ll be, really, up to the students. We offer (banking) for the students and that really needs to be our reason for doing it. ... We want to know what they want.”
Maximus (anonymous) says...
Hey Lyon County State Bank, you lost the bid. Perhaps if you had been more competitive with it, you would not have needed to file this protest? I admit, that I don't know all the details, but this sounds like a case of being a poor loser to me.
August 22, 2009 at 1:11 p.m. ( permalink | suggest removal )
reddog (K. B. Thomas Jr.) says...
ThIs is what I call sibling rivalry. You can bank on it. Two brothers are going head to head. And as Paul Harvey would say, now you know the rest of the storey. My biggest disappointment in college was to find out that the guy that writes the ads for the bank isn't the guy that makes the loan.
August 22, 2009 at 1:22 p.m. ( permalink | suggest removal )
bobhornet (anonymous) says...
Lane is a buffoon...more of these problems will creep up. Especially with his new plans to market ESU degrees in China.
August 22, 2009 at 2:28 p.m. ( permalink | suggest removal )
hickory (anonymous) says...
It doesn't make a whole lot of sense to me, because I heard Lyon Co. State Bank owns Marion Bank anyway.
August 22, 2009 at 2:54 p.m. ( permalink | suggest removal )
JustWondering (anonymous) says...
I don't care who provides the banking service in the Union. However, forcing students to use that bank in order to receive financial aid is just wrong. Surely the University has someone who can figure out how to make direct deposits in different banks of the student's choice just like every employer who offers direct deposit does every payday.
August 22, 2009 at 8:47 p.m. ( permalink | suggest removal )
history_nerd (anonymous) says...
ESU does not "force" students to use a particular bank. You can go in at any time and fill out a direct deposit authorization form in the financial aid office and have your funds deposited to the account of your choosing.
August 22, 2009 at 9:11 p.m. ( permalink | suggest removal )
dragyours2001 (anonymous) says...
History nerd, I am not sure if that is true or not, if indead it is, the campus sure will not tell new students! I moved here when my wife got a teaching job in the area, and when I did the enrollment process I was taken directly to the bank and told to set up a account for finacial aid, my wife and I already had a existing account at a major bank. I asked the woman, that was doing the swarm, if we could just use that account and we were told no.
August 23, 2009 at 8:14 a.m. ( permalink | suggest removal )
barefootin (anonymous) says...
I dont know about the direct deposit, but i know someone who had her excess funds given in check form, then she deposited it into a different bank. I know the students are told they have to open a Lyon County bank, but what stops someone from closing it after they open it?
August 23, 2009 at 10:31 a.m. ( permalink | suggest removal )
Free4all (anonymous) says...
It is true that ESU will NOT transfere funds to a bank of your choice. It is not a user friendly system and no real explaination is out there as to why, just like any employer, you have to use there bank. If you choose to retain a check instead you will have a waiting period. If you are waiting to use the money to buy books, this really hurts to wait for that check. Thay do that to ensure no student will have time to order books online and have to buy the over priced, seldom used books that are required.
August 23, 2009 at 1:35 p.m. ( permalink | suggest removal )
sunshine (anonymous) says...
history_nerd
ESU does not "force" students to use a particular bank. You can go in at any time and fill out a direct deposit authorization form in the financial aid office and have your funds deposited to the account of your choosing.
It's funny that my husband and I both have attended ESU and now have a daughter attending and at no point were were told that we had a choice as to what bank that we could have our excess funds direct deposited to. As a matter of fact at the SWARM that we just went to we were told that she had to set up an account at LCSB OR funds could be received in check form which would come a week later than the direct deposit. Same thing my husband and I were both told upon our own enrollments.
August 23, 2009 at 1:54 p.m. ( permalink | suggest removal )
dragyours2001 (anonymous) says...
YY4U --- Your the perfect example of a ignorant redneck. I do receive financial aid in the form of student loans, which I will infact be paying back with my own money. Not all financial aid is free handouts, so get your facts straight and stop being cretinous.
August 23, 2009 at 4:33 p.m. ( permalink | suggest removal )
goodoleboy (anonymous) says...
So your assuming he will default on his student loans?
That is the same is assuming that you will default on your double-wide, give the kid a break, student loans are immune to bankruptcy in almost all cases, so rest assured you will get yours back with interest Tex.
August 24, 2009 at midnight ( permalink | suggest removal )
jlhart22 (anonymous) says...
I'm not even getting involved in the immature making fun of each other that has started. If ESU was intent on being user-friendly, which in most cases they aren't, they would not be changing banks in the middle of the school year or at all for that matter. All these students have LCSB accounts that they will have to change now. To the person who said that LCSB owns Marion Bank. I don't know for sure but I really doubt it. LCSB is a local bank Marion Bank is not, and they wouldn't be competing with each other if one owned the other. Also, no one knows what happened with the contract process, and if it was handled illegally then it is fine for LCSB to protest it. We have laws for a reason, and if ESU broke the law they should be called on it. This whole deal wouldn't even be an issue if ESU were more concerned with students then money. It is ridiculous that you have to have a certain account just to get financial aid.
September 5, 2009 at 10:50 a.m. ( permalink | suggest removal )