The Division of Community & Regional Affairs was proud to partner with the U.S. Department of Treasury, Bristol Bay Native Association, Bristol Bay Housing Association, Dillingham Chamber of Commerce, Wells Fargo, Key Bank, Credit Union One, Alaska Manufacturing Extension Partnership, to deliver information on services and programs to residents in rural Alaska communities. 

Panel Presentations

• Mark Davis, Director of Corporations, Department of Commerce, Community and Economic Development
• Tara Jollie, Director, Community and Regional Affairs, Department of Commerce, Community and Economic Development
• Lisa Wimmer, Wells Fargo Bank
• Silvia Reyes, Key Bank
• Tom Newins, Credit Union One
• Craig Nolte, Federal Reserve Bank of San Francisco
• Angelina Estrada-Burney, Office of the Commissioner, Special Project Manager for Community Relations, Department of Commerce, Community and Economic Development

Local host/coordinator:

Ralph Andrew, Local Government Specialist, Division of Community and Regional Affairs, Department of Commerce, Community and Economic Development

Purpose:

Bristol Bay Native Association leadership granted Commerce staff and presenters access to a large number of Bristol Bay's village leadership during the BBNA Presidents and Administrators Workshop. Commerce again extends appreciation and gratitude to Bristol Bay Native Association for the opportunity to present information about this important project.

The purpose of the workshop was to explore how to enhance access to mainstream financial products and services in the Bristol Bay region. Most of the discussion focused on how individuals living in villages without bank branches can receive their paychecks, deposit them into bank accounts, and still have access to their funds. Solutions included internet banking, stored value cards, debit cards, and pay-by-phone.

Presentations by financial institutions:

Each financial institution was given the ability to present their services. Credit Union one stated they had 13 locations in Alaska and that banking services were targeted mainly to individuals and not to businesses. Key Bank spoke to their Key Capture service, online banking, online bill payments and direct deposit services. Wells Fargo spoke to their realization for the need for additional financial education in the region and talked about their Hands On Banking which is a non-branded program for grade school children to adults. They do also offer an Opportunity Checking Account to those residents who have had bad credit and NSF checks in the past but are attempting to establish themselves once again.

Feedback from Participants

The Bristol Bay region is approximately the size of Ohio but with very few roads and only 2 branches of financial institutions. While the bulk of local employment is seasonal, the amount of commerce taking place in some of the communities is substantial due to its extensive fishing and processing industries.

Also, one gentleman stated that in one gaming weekend, they might collect over $20,000 and have to wait to get to Dillingham to deposit.

Participants confirmed the need for convenient access to financial services and confirmed that may local residents have no bank accounts whatsoever for varying reasons. Local residents receive salaries, wages, and other income such as social service payments, Permanent Fund Dividends, and social security payments in the form of a check. Since most communities do not have a bank branch, they try to cash their check at the local retail store or purchase money orders in various amounts from the local Post Office. In some cases, they may endorse their check for payment of goods or services. Some checks are endorsed several times before they are cashed, making the checks an alternative form of currency. Deposit and check cashing services are needed during the fishing season where residents may walk away with $25,000 in a season and keep that on hand instead of depositing.

Key Bank left Dillingham about two years ago, leaving Wells Fargo’s branch the only remaining bank in town, and maybe the region. Key Bank maintains a branch in Dutch Harbor. Wells Fargo Bank has an office in both King Salmon and Dillingham.

Shareholders expressed the need of bankers that are hired needing to understand and recognize how Rural Alaska works.

While some participants expressed interest in internet banking, all agreed that their lack of access to high-speed broadband service limited their ability to use the service as the service is terribly slow or non-existent. Some did not trust the internet method as they were skeptical at a guarantee of security of their private information. In some villages, the school is the only location where computers with Internet are located and the school is closed at the height of the fishing season so they are not accessible. Pay-by-phone banking was not discussed at length, so its acceptability was not determined.

Panel presenters discussed how native shareholders could have their paychecks deposited electronically (direct deposit) and then access their funds using a debit card. Shareholders would use the card at a local store to make purchases and could ask for cash back too. While this could work in some villages, those without a local store, bank or ATM would not have convenient access to their funds. Also, some participants indicated that their members needed financial education to help prevent withdrawing more funds than present in their accounts and incurring high fees. Understanding all of the fees charged by the financial institution was not easily understood by all.

The Key Bank and Wells Fargo presenters indicated that ATMs are money-losers for banks and may not be practical in rural villages due to a variety of reasons including initial expense (est. $30K) servicing costs, maintenance expenses, and security issues related to restocking with money and preventing theft.

It was encouraged that this team travel to the different villages along with agency members to develop a trust level and reliability. Many people come in and discuss services but these agency members never see steps taken in those directions.

Working with Local Employers
There was some discussion on how to encourage fishing industry (canneries and fishing boat) workers to establish bank accounts and processing facility and fishing industry employers to offer direct deposit service for their employees. Some thought that separate meetings with large employers including Trident and Peter Pan would be very valuable. While the lower costs of paying its employees may be a sufficient incentive for the employers, there may be a need for an incentive for the employees. One local employer stated that he didn’t have direct deposit but none of his employees had even inquired about the possible service. The employers could tell us what point would be best for them to encourage their employees to sign up for direct deposit, such as at time of signing employment agreements, during orientation, or at payday. They recognized that the villages have been 100% cash economy for so long that it would take time to educate shareholders on these banking services.

Working with Employees of Local Employers
Either requirements or incentives may need to given employees to encourage them to sign up for bank accounts. Employees arriving from other states may already have a bank account and could submit a MICR number to their employer. Those employees from Alaska villages could be presented with information on Alaska-based financial institutions, including those that have offices in their region.

Top Banking Needs (facilitated discussion)

• More banking choices (competition) with toll free numbers for service
• Checking cashing services especially during peak season
• Faster ways to make deposits
• Check scanning/RSU machines (Key Capture from Key Bank)
• Financial education offered locally
• Bank branches in more areas
• ATMs that accepts large deposits
• Access to loans, especially for fishing businesses
• Improved, reliable phone and internet service**
• Flying bank (mobile branch)
• Direct deposit – especially from processors
• In-person visits by representatives from financial institutions to assess needs
• Funds verification services

Next Steps

• Compile notes from the workshop and names of participants and send to participants electronically and place notes on BBNA web site.
• Assess each community’s situation by creating a chart for each community in the Bristol Bay region that indicates: population size, employers w/number of employees, stores, bank offices, post offices, broadband access, telephone access, etc.
• Distribute a survey of current and needed banking services in Bristol Bay to identify what banking tools would work best in the region.
• Meet with officials from major employers in Bristol Bay region to encourage them to offer direct deposit of paychecks. Craig Nolte agreed to meet with officials from Peter Pan Seafoods and Trident Seafoods in Seattle.
• Research how more reliable and faster internet could be offered in rural communities.
• Evaluate how pay-by-phone service could be a good option, especially in areas where internet service is slow
• Encourage Bristol Bay Native Corporation, State of Alaska Permanent Fund Dividends, and other issuers to require bank accounts to provide funds.
• Expand financial education using the revised “Building Native Communities: Financial Skills for Families” curriculum, and include information on access mainstream financial products and services.
• Encourage banks to offer lower-resolution web pages that can be accessed easier by those with slower internet service.
• Explore pooling payroll services to achieve the scale needed to justify paying faster internet service and check scanning machines.
• Encourage legislators to revise existing grant rules to extend funding to communities with slow, such as dial-up, internet access.
• Seek comments from Village Councils

BBNA Workshop Participants