Finance and Management Services
www.santa-ana.org/finance
Item # 12
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
August 5, 2025
TOPIC: Collection Agency Services
AGENDA TITLE
Agreement with BC Services, Inc. for Collection Agency Services (Specification No. 25- 040) (General Fund)
RECOMMENDED ACTION
Authorize the City Manager to execute an agreement with BC Services, Inc. to provide collection agency services for a term beginning August 5, 2025 and expiring August 4, 2028, with provisions for two (2) 1-year extensions (Agreement No. A-2025-XXX).
GOVERNMENT CODE §84308 APPLIES: Yes
DISCUSSION
As part of its regular operations, the City routinely processes payments to vendors and collects monies owed to Santa Ana. The Treasury and Customer Services Division (TCS) has historically led the City’s collection efforts, managing delinquent account referrals from all agencies. In addition, the City contracts with outside billing and collection services for paramedic services and parking ticket citations. When both internal efforts and contracted services are unable to recover outstanding debts, the accounts may be referred to an outside collection agency for further action.
To support these efforts, TCS is committed to using all available resources to increase the collection of monies legally owed to the City. The City makes several attempts to collect in-house before delinquent accounts are referred to collection agencies. As part of this process, the City issues a minimum of three collection letters to individuals and businesses with outstanding balances. These letters notify them of the amount owed and may offer payment alternatives, such as installment plans. The City strives to ensure that a resident or business is provided an opportunity to resolve their debt before it is escalated to a collection agency. If a customer fails to respond or does not adhere to a mutually agreed upon payment schedule, the account is referred to a third-party collection agency for further action.
The referral of delinquent accounts to third-party collection agencies is an efficient method in managing debts owed to the City. These agencies have the resources required to
Collection Agency Services
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monitor accounts in addition to ensuring compliance with the Fair Debt Collection Practices Act (FDCPA), Federal Fair Credit Reporting Act (FCRA), and other legislation.
The selected proposer has proven to adhere to all of the rules required for debt collection, including state laws that protect debtors from harassment, abuse, and deceptive practices. These rules include restrictions on communication times, the use of threatening or profane language, and the representative of debt collection practices.
The City’s current agreement with its temporary collection agency servicer expires September 30, 2025. To enhance debt recovery and resume regular collection cycles, staff initiated a competitive bidding process. Request for Proposals (RFP) No. 25-040 was issued on March 12, 2025, on the City’s online bid management and publication system. A summary of vendor participation and results is as follows:
72 Vendors Notified
1 Santa Ana Vendor Notified
31 Vendors Downloaded the RFP Packet
9 Proposals Received
0 Proposals Received from Santa Ana Vendors
Proposals were solicited, opened on April 10, 2025, and evaluated. Nine (9) proposals were submitted by the RFP deadline, and eight (8) proposals were determined to be responsive to the specifications and met the City’s requirements. An evaluation committee reviewed the responsive proposals and rated them according to the criteria listed in the RFP.
Staff recommends awarding an agreement to the BC Services, Inc. (“BCS”) (Exhibit 1).
The proposal submitted by BCS was found to meet the City’s needs, offers the best value, and is appropriate for the services requested. BC Services possesses a strong background and experience, understanding of the scope of work, and value added customer service.
Local Outreach Efforts
The Purchasing Division advertised this project on the City’s online bid management and publication system, which directly notified one (1) Santa Ana vendor. However, no Santa Ana vendors downloaded the RFP packet or submitted a bid for consideration.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
Payment for services is contingent upon successful collection, regardless of effort spent on individual accounts. There is no direct fiscal impact on any expenditure accounts. The vendor will retain a fee ranging from 14.5% to 25% of the amounts collected. This includes 14.5% for accounts placed with the vendor for initial collection efforts and 25% Collection Agency Services
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for accounts that have previously been worked by another collection agency or that require City-authorized legal action.
These types of fees are standard within the industry and are lower than the rates currently paid by the City. BCS has also agreed that the City may withdraw any uncollected accounts at any time without charge or penalty. As a result, net revenues will be reduced by the amount paid to the vendor for collections.
EXHIBIT(S)
1. Consultant Agreement with BC Services, Inc.
2. RFP 25-040
Submitted By: Alex Trinidad, Executive Director, Finance and Management Services Agency
Approved By: Alvaro Nuñez, City Manager