SANTA CRUZ, Calif. – Bay Federal Credit Union was chosen as one of two locally-owned financial institutions to receive part of the city's investment portfolio. The transfer, according to local officials, is an effort to keep the city's financial resources working locally. The city purchased a five-year, $500,000 certificate from the credit union, as well as a $96,000 certificate from Santa Cruz County Bank. City Councilman Ryan Coonerty, who also serves on the board for Santa Cruz Community Credit Union, spearheaded the move. "He was reviewing the city's investment, and asked why they weren't investing their money locally," said Carrie Birkhofer, Bay Federal President/CEO. The council determined that Santa Cruz Community Credit Union was off-limits due to Coonerty's position on the board, but it did approach the $490-million Bay Federal to inquire about rates. "When they investigated our rates, they found they could earn more than with a government treasury bond," Birkhofer said. Because Bay Federal has a community charter that allows business and organizational accounts, it was able to close the deal. The deposit couldn't have come at a better time. Bay Federal currently has a 166% loan-to-share ratio, and is looking for deposits, Birkhofer said, although she added "it's a good problem to have." David Culver, Finance Director for the city, said it's common for cities to purchase non-negotiable investment vehicles like certificates, but focusing on local institutions is less common; however, some other northern California cities have done so in the past. "We only looked at what we considered to be true local institutions, as opposed to financial institutions that have branches here but are headquartered in other parts of the state or country – that's the purpose, really, to keep the money local," he said.