2004-07-14 CC WS & Meeting - Laserfiche WebLink

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Page I of2 , Ellen Paul seth m: james.carufel@southstpaul.org nt: Thursday, December 11, 2003 9:52 AM To: epaulseth@centervillemn.com Subject: Credit Card Study Results Hello Colleagues: Sorry about the last e-mail without the results. The attachment upload feature did not work. Here are the results: A few weeks ago I sent the MGFOA listserv the following... . "South St. Paul is studying the question... Should the city allow customers to a for water bills, licenses, ermits and ~ ~ecreation fees with credit cards, debit cards and direct e uctlOns rom their checking account. ? If your city allows any of these payment vehicles for licenses, water bills, permits or recreation fees, please send me a brief e-mail mentioning I) What you allow, 2) What you think it cost you (fees, lost water bill penalties, staff time, auditor costs and 3) What benefit is derived (e.g. 40% of our water customers use it and love it). Even if you don't allow these payment vehicles, please share any information or opinion you might have." We received a very good response. We heard form 35 cities that DO allow some method of electronic payment. We also heard from some cities and which do not allow any ofthese electronic payment options but were mterested in expressing a view and/or requested the results of the survey. survey was not inteded to provide hard data but rather to gauge the general state of the city industry in its acceptance of electronic payments. We did come away with some solid trends. Individual city information is not available. For purposes of the results, responding cities of St. Paul, Duluth, Minneapolis (all of which are very liberal in allowing forms of payment) have been excluded. General Usage So we ended up with 32 positive responses - cities that allow some form of electronic payment. Based on the 150 or so cities listed in the MGFOA directory, a positive response of32 indicates that about 20% allow some sort of payment. However, a number of cities which allow payments did not respond - my estimate is that 30% of Metro Area and larger outstatp: ('lt1Pc !l11nu.r electronic navments. .water Sewer Bills ~ Only 5 of the 32 cities allow cerdit card payments of water/sewer bills ehereas ALL 32 allow ACH (direct deduction from checking accounts). Those allowing credit cards characterized it as being done purely for customer service and costly in lost penalty revenues and credit card fees. Those cities with ACH that have software which automatically credits payments from the ACH data said it actually saved them time. Conclusion: ACH is the state of the industry - not credit cards. ACH was not prominent in any other areas of city operations. Retail Ooerations . If a city has a liquor store or golf course, they accept credit cards. This is considered a necessary cost of being in the competitive, commercial world. Credit cards also seem to be the norm at larger community/aquatic ceneters also. Including monthly flat fees, the overall cost of credit cards runs 1.5% to 3.5% with 2.5% appearing to be average. Park and Recreation Fees state of the industry here seems to be a mixed bag. If a city already allows credit cards for retail operations, it is y that they will also allow credit cards for park and recreation fees. Ifthey don't already allow credit cards, it is highly unlikely that they will be allowing credit cards ONLY for parks and recreation fees. Permits and Other Charges , This might be a future growth area but right now few cities allow credit cards for permits, fines etc. There were a 7/1/2004