Managing Editor
There’s no telling how many millions of dollars pass through the Jacksonville branch of the Federal Reserve Bank of Atlanta on any given day.
Really, there’s no telling. Nobody is allowed to talk about it publicly.
“A lot” was all that Christopher Oakley, vice president and regional executive of the Jacksonville branch, would say.
Considering that one “cash bus” of $20s in the highly secured cash room totaled $11.2 million, and that there were several buses in view and who knows how much in the vault, the math adds up.
Then there’s the $2 million cash bus of $5 bills in a lobby display, bathed in sensors in case anyone desires an up-close view.
Money and security abound at the 800 Water St. structure Downtown, near the Osborn Center. In basic terms, the branch is considered the bank for regional banks, taking in their deposits and providing them cash withdrawals as needed.
The branch is gearing up, as are all of the branches in the Fed system, for the new $100 notes to be released Feb. 10. The makeover of the bill means a retooling of the equipment that the branches use to sort, count and stack the currency passing through.
“When we get a new design, it requires retrofits on our machines,” said Oakley.
The Federal Reserve System is the nation’s central bank and is based in Washington, D.C. It was created in 1913 when President Woodrow Wilson signed the legislation and earned his place as the face on the $100,000 note.
Those don’t pass through, though. The highest denomination bill in circulation is $100, graced by Benjamin Franklin.
The Federal Reserve Banks consist of 12 regional banks. The regional Atlanta Federal Reserve Bank has five branches in Jacksonville, Miami, Birmingham, Nashville and New Orleans.
About 765 banks and branches in most of Florida, other than South Florida, send their currency to the Jacksonville branch for processing, including destruction and replacement of worn-out bills and detection of counterfeit notes. During a tour early Wednesday, three counterfeit bills had already been found.
Oakley and Community Relations Coordinator Barbara Klinger said 20 to 30 counterfeit bills a day are detected and turned over to the U.S. Secret Service. The banks that send them are debited. Oakley said the Fed’s cash employees know the counterfeit money more by feel than by sight. The counterfeit bills don’t have the consistency as real notes, which are 75 percent cotton and 25 percent linen.
The branch also shreds 15 to 20 percent of the cash it processes daily because it’s worn out. The banks are credited for the deposit and the U.S. Treasury is notified.
The $1 and $5 bills, which wear out the quickest, generally circulate for 18 to 24 months.
As for counting the bills, the equipment can handle up to 100,000 notes an hour. The cash room, covered by security cameras and mirrors, is staffed by no fewer than three and no more than eight employees at one time and all must be in the constant presence and view of each other. Their personal items remain in hallway lockers. They work in four 10-hour shifts.
Background checks for the cash workers include criminal and credit checks. “The credit has to be perfect,” said Oakley.
Once counted and sorted, the cash is stored in the vault until the banks need it. Banks request more cash for holidays and events such as approaching hurricanes, and once those events pass, the cash returns for storage.
The Fed has operated a branch in Jacksonville since 1918, first in leased space. It occupied buildings on Hogan Street and then Julia Street before moving into the fortress on Water Street in 1987.
The 150,000-square-foot building houses about 185 employees, although some work from home. That’s down from 325 not long ago, when the branch processed checks. The branch had processed as many as 5 million checks a day before customers stopped using them as frequently when banks and businesses turned to electronic processing.
When the Jacksonville branch stopped processing checks in 2008, the volume had fallen to 500,000 a day. Now, the Federal Reserve Bank in Cleveland handles all the checks from U.S. banks.
“The banking industry has caught on they don’t need the paper,” Oakley said.
The Jacksonville Fed branch hosts tours for older school children and adults. A well-secured display in the lobby features specimens of $500, $1,000, $10,000 and $100,000 notes. It also features notes that individual banks were allowed to produce early last century.
One of those notes is a 1929 series bill issued by The Florida National Bank of Jacksonville. Such bills were individually signed by the bank’s president and cashier. In Florida, 24 banks in 14 cities issued their own currency.
While the branch hosts tours, they must be scheduled in advance and guests should be prepared for security checks.
Guests and their belongings are first screened in a security room and then they must be accompanied throughout the tour.
Sensors and cameras are monitored by the Federal Reserve Police, who are onsite all day, every day. They have federal law enforcement powers, including arrest powers.
Banks are responsible for transporting and retrieving their currency at the branch, and the armored trucks must pass through strict security. In addition, all money bags are inspected and any problems, including the smallest speck of a hole, will result in rejection of the deposit.
“It’s all choreographed so we know what to expect,” said Oakley.
In addition to the cash employees and law enforcement, the branch employs accounting, support, training, maintenance, housekeeping and food service staff.
Oakley’s group also provides research, observations and local reports to the Federal Reserve Bank of Atlanta president, who uses the information from the regional banks to help make monetary policy in Washington.
“We supplement the data with stories we’re hearing,” he said.
The information filters up from the branches around the country to the Federal Open Market Committee, a committee of the Federal Reserve Board of Governors and five Reserve Bank presidents who meet eight times a year to set the course for monetary policy.
Oakley must observe a 10-day “quiet period” preceding the meetings to avoid making any comment about the committee’s potential direction.
Outside the quiet period, Oakley also makes presentations.
“We’ve been very popular. During the height of the recession, we got out a lot,” he said. Groups wanted to know what the Fed was doing during the recession, which began in December 2007 and has been considered the worst downturn since the Depression.
Because of its decrease in employment, the Jacksonville branch is leasing space to two tenants, including an insurance information-technology company. Employees go through the same security system as the Fed workers.
The branch gives five or six tours a week of 20 to 30 people each. Visitors should look closely at the notes over $100 because they might not see them anywhere else. Only 42,000 of the $100,000 notes were issued in 1934, but were not circulated in the general population. Instead, they were used by the Federal Reserve. The U.S. Treasury knows where they are.
To learn more or request a tour, visit www.frbatlanta.org. For more information about the Fed, also visit www.federalreserve.gov and www.federalreserveeducation.org
356-2466