by John Dowd
During the Administrative Report section of the meeting, the finance department presented a PowerPoint to go over the process the Town went through to transfer funds from numerous accounts, placing the majority into a single banking institution. The presentation came in response to recent criticism over the move. That criticism called into question the legality of the move and whether this move satisfied legal mandates for protection and collateralization of public funds and pledge requirements as described in Montana state law.
According to Robert Underwood, a finance officer with the Town of Stevensville, the decision to transfer its primary banking relationship from Rocky Mountain Bank to First Security Bank in 2023 was driven by a desire to increase interest earnings on public funds while maintaining compliance with state security requirements.
Town records show Stevensville concentrated the majority of its funds in a single banking institution for more than a decade. From 2012 through 2023, most town funds were held at Rocky Mountain Bank, with smaller amounts maintained at Missoula Federal Credit Union, First Security Bank and, later, Clearwater Credit Union following a merger involving Missoula Federal Credit Union.
The percentage of town funds held at Rocky Mountain Bank increased steadily during that period, rising from about 62% in 2012 to nearly 98% by 2018. Following the merger of Missoula Federal Credit Union into Clearwater Credit Union, Rocky Mountain Bank continued to hold roughly 98% of the town’s deposits.
In July 2023, Stevensville Town Finance Officer Gina Crowe identified that certificates of deposit held at Rocky Mountain Bank were generating comparatively low interest returns. After consulting with town officials and local financial institutions, Crowe determined that First Security Bank was offering higher interest rates on comparable deposits.
With approval from Mayor Steve Gibson, the town transferred its primary deposits from Rocky Mountain Bank to First Security Bank in September 2023. Following the transfer, most town funds were held at First Security Bank.
The change increased annual interest earnings by approximately $108,326, a gain of nearly 1,285% compared with the town’s previous banking arrangement. The effective return on public funds rose from about 0.25% to roughly 3.37%. In interest, the town has made $335,626, according to the presentation.
The transfer was intended to maximize returns on public funds while maintaining safeguards required under Montana law. State statutes require public deposits that exceed Federal Deposit Insurance Corp. coverage limits to be secured through pledged collateral.
According to the review, both Rocky Mountain Bank and First Security Bank pledged collateral in excess of statutory requirements. Such collateral may include U.S. Treasury securities, federal agency securities, government bonds and other investments authorized under Montana law. The assets are held by independent custodians and can be claimed by the town to recover uninsured deposits in the event of a bank failure.
The report noted that Stevensville’s public funds benefit from both FDIC insurance and pledged securities, creating multiple layers of protection for taxpayer dollars. The finance officers also claimed compliance with collateralization requirements is verified through the town’s
annual audit process. So far, according to Crowe, they have not yet been nocked for failing to comply in this area. According to Underwood, “This just shows that the finance department has a high standard, and is trying to do right by the town.”
The review concluded that Stevensville has maintained a consistent approach to managing public funds by emphasizing both security and financial performance. Officials said the 2023 transfer to First Security Bank was an authorized effort to obtain better interest rates while continuing to protect public deposits under Montana law.
The town’s most recent bank reconciliation was reported to be balanced in May 2026, and an updated cash report was provided to officials on June 9, 2026.
Later in the meeting, Jeff Motley, the Stevensville Fire Chief, spoke to the council. The agenda item he was involved with presented the idea of hiring grant writing services for the fire department. Stevensville Fire Department is going to be applying for the Assistance to Firefighters Grant, offered by FEMA. The grant would cover the cost to re-outfit the department with updated safety equipment. The current equipment the department has is, according to Motley, in its eleventh year of use, with a lifespan of 10 years. In other words, Motley expressed, “The problem does not go away,” if they do not approve this.
Motley said they will need 28 new sets in order to replace one for each firefighter and to have a couple extra sets. That would cost the department, and the town, over $100,000. That personal protection gear, Motley explained, is essential. Each set, according to Motley, costs around $5,000.
The department’s plan is to hire a professional grant writer to increase chances of receiving the assistance. The cost would be around $3,000, and the firefighters have selected Grantmasters Inc. According to Motley, Florence Fire uses them regularly.
The department has also used this company before, when they sought a grant to upgrade their radio equipment. Because the grant writing company has worked with the department before, it will already have access to a lot of background information that these grants require, meaning the process could be done much more quickly and efficiently than if they contracted a different company.
The grant will also call for a 5% match, which was estimated at around $7,000. The department plans to apply to the RAPP Family Foundation for a grant to help with some of these up-front costs. The department will also be hosting several fundraisers, including an upcoming pancake breakfast, among others.
During discussion, Stevensville Town Council Member Karen Wandler said, “They are volunteers, and we need to protect them all we can.” It was also apparent that if the department was not approved to engage Grantmasters Inc. and they applied and failed to receive the grant, the department would be back to request the full $100,000 for the replacement of the outdated equipment that keeps them alive.
The council approved the request.
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