Any introductory lesson about the Federal Reserve usually includes a mention of the Fed's three main functions, commonly referred to as the three-legged stool: 1. formulating sound monetary policy; 2. fostering safe and responsible banking practices; and 3. providing efficient, reliable and accessible payments services. Like other Reserve banks, the St. Louis Fed's mission statement has always contained wording reflecting these roles. But in our 2007 strategic plan, we expanded our mission to incorporate two functions that we believe distinguish us as a Reserve bank:
Partnering with the U.S. Treasury is our Bank's primary national assignment. By adding Treasury work to our mission, we are making more explicit our commitment to helping the agency find cost-efficient solutions that benefit taxpayers. One example is our management of the U.S. Treasury's Go Direct campaign, through which the Treasury is aggressively working to convert paper check payments to electronic payments to save the government more money. The campaign aims to persuade people receiving paper Social Security checks to convert their payment to direct deposit. The campaign's first year led to a savings of $18 million.
Over the last several years, the St. Louis Fed has worked with the other Reserve banks to identify cost-saving opportunities. This effort has resulted in new systems, such as a web site for making government payments that will reduce costs by automating payments and business processes for hundreds of government agencies.
The decision to include public programs in our mission is another step to broaden our outreach efforts through the areas of community economic development, economic education and regional economic research. While we've always performed these functions, we expanded them in earnest when we lost our check processing operations in Little Rock and Louisville and decided we could no longer efficiently support cash operations in these locations. What we've found is a pent-up demand in our communities for Fed programs. Look for us to sponsor or host an increasing number of events and programs throughout the District as we strive to reach wider audiences, including bankers.
It is not often that you'll see a Reserve bank tinker with its mission statement. We felt, however, that adding a couple of new legs to the Federal Reserve stool would make that stool sturdier.