CITY COUNCIL STAFF REPORT
Meeting Date: September 12, 2022
TO: THE HONORABLE MAYOR AND CITY COUNCILMEMBERS
SUBJECT: ADOPT RESOLUTION NO. ___-22 AMENDING THE ADOPTED
CREDIT CARD AND ELECTRONIC PAYMENT PROCESSING
CHARGES AND DIRECTING SAID CHARGES BE ADDED TO THE
MASTER FEE SCHEDULE
SYNOPSIS
The proposed resolution would authorize the City to amend the charge of a fee for credit card, debit card, or electronic transfer payments for services rendered by the City, or payment of a fee or other charge due to the City, in an amount that does not exceed the City’s cost for providing for these types of payment options. The payment processing charges would be added to the Master Fee Schedule adopted by Resolution No. 51-22 on June 27, 2022, as “Citywide Fees” and supersede Resolution No. 64-21 adopted on October 4, 2021.
DISCUSSION
California Government Code section 6159(b) allows a city to authorize acceptance of a credit card, debit card, or electronic transfer for payment for services rendered by a city or for payment of a fee, charge, or tax due to the city. Section 6159(h) authorizes a city to impose a fee for the use of such payment methods, in order to recoup the actual costs incurred by the city (for instance, the fees charged by third-party services in order to process a credit, debit, or electronic transfer payment). For convenience, the payment processing charges will also be incorporated in the Master Fee Schedule as “Citywide Fees.”
The Budget Committee and City Council approved imposing the fee using electronic payments last October. The City began working with our online merchant provider, in-person merchant provider, and the online payment portal service company to implement the authorized changes.
There was not a viable solution after multiple attempts with our current merchant providers to implement the convenience fee. Also, our online portal service company required a minimum transaction amount that was not incorporated into the original resolution.
The City consulted with our current banking provider who offers merchant services and found a solution for both our in-person and online services. They reviewed our transaction history to determine the fee to ensure cost recovery, which is slightly higher than that originally adopted by resolution in October 2021. In the amended resolution, the changes include the revised rates and minimum fees so that the City is no longer absorbing this cost. Finally, the amended resolution includes language to adjust the fee charged by our merchant provider and/or online payment portal service, if necessary.
FISCAL IMPACT
The impact of this resolution is a fiscal benefit to the City, because it will allow the City to recoup costs for fees associated with electronic payments rather than absorbing those costs as it has done in the past. The average monthly transaction fee is approximately three thousand dollars.
PUBLIC CONTACT
Public contact was made through posting of the City Council agenda on the City’s official notice bulletin board, at the Pleasant Hill Senior Center and at the Pleasant Hill Police Department. The agenda and staff report are posted on the City’s web page.
RECOMMENDED CITY COUNCIL ACTION
Adopt the proposed resolution adopting credit card and electronic payment charges and direct that said charges be added to the Master Fee Schedule.
ALTERNATIVES TO RECOMMENDED ACTION
Do not approve the proposed resolution and provide further direction to staff.
ATTACHMENT(S):
Proposed Resolution
Prepared by: Erick Cheung, Finance Manager
Approved by: Ethan Bindernagel, Acting City Manager