HomeMy WebLinkAboutItem #04 Approval of Proposed Policy for City to Absorb Credit Card Transaction Fees for Products and Services other than Utility Billing oc_oe
florida
AGENDA ITEM COVER SHEET
Meeting Date: August 2, 2016
Item # 5
Reviewed By:
Contact Name: Al Butle r, Support Department Director:
Contact Number: 407-554-7063 City Manager:
Subject: Proposed policy for city to absorb credit card transaction fees for products and services
other than utility billing.
Background Summary:
Presently, the city accepts credit cards for various city programs and services. Under the city's
existing credit card policy, the customer is required to pay a service fee imposed on all credit and
debit card transactions to cover the cost of credit card processing. This fee is paid directly to the
card processor and is not city revenue. As the city develops new programs and online services,
the objective is to enhance public services and efficiency. With new software products being
implemented to manage a wide range of programs, including online services, charging customers a
credit card processing fee will substantially reduce customer satisfaction, and residents' access to
community programs. Some online services being deployed by the city do not offer the card
processing service fee option.
Issue:
Should the City Commission endorse. a general policy of having the city absorb credit card
processing fees.
Recommendations:
Staff recommends that the City Commission endorse a general policy for all credit and debit card
transactions fees to be paid by the city unless doing so imposes an undue burden on city
revenues. The City Manager should be given the authority to select those payments that may not
be suitable for inclusion in this policy. Based on existing conditions, facility rentals, activity fees,
and similar charges would be covered by the new policy. Utility fees, capital water and wastewater
charges, and impact fees would be excluded. Most building permits, except those for all new
construction and commercial additions, would be included under the policy.
Attachment: None.
Financial Impact:
Staff expects the cost of card processing fees to be less than $25,000 annually. Rental and
program fees in the Parks & Recreation Department have already been adjusted to accommodate
the change. Similar fee adjustments may be applied to other programs covered by the new policy,
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as may be required to maintain revenue levels. Relative to Parks & Recreation, and based on the
forecast FY 2016 Budget revenue of $670,250 (p. 3-6), 3% transaction fee, and 75% of
transactions being paid by credit card, the cost to the city to absorb credit card processing fees for
would be $13,663 per year. The highest rate for credit card processing is 2.99% for high-yield
reward cards; most cards are lower. The cost of accommodating the credit card processing fee for
other products and services, many of which are of an infrequent nature, such as beer sales at
Founders' Day, are not expected to be significant on an annual basis.
Type of Item: (please mark with an 'x')
Public Hearing For Clerk's Dept Use:
Ordinance First Reading X Consent Agenda
Ordinance Second Reading Public Hearing
Resolution Regular Agenda
X Commission Approval
Discussion&Direction
__ Original Document/Contract Attached for Execution by City Clerk
Reviewed by City Attorney N/A
Reviewed by Finance Dept. N/A
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