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Home My WebLink AboutOrdinance 6315of FpYErrF 9gkAN5P5 113 West Mountain Street Fayetteville, AR 72701 (479) 575-8323 Ordinance: 6315 File Number: 2020-0389 CREDIT CARD AND DEBIT CARD TRANSACTION FEES: AN ORDINANCE TO APPROVE THE ASSESSMENT OF A 2.95% FEE FOR CREDIT CARD AND DEBIT CARD TRANSACTIONS OTHER THAN UTILITY BILL AND PARKING FEE PAYMENTS WHEREAS, the City currently accepts credit card payments for utility bills, recycling and trash invoices, airport hangar rental and supply purchases, animal shelter fees, building permits, business licenses, miscellaneous billing of City services, parking, and miscellaneous Police fees and has always absorbed the transaction fees for those payments; and WHEREAS, in 2019, the Arkansas General Assembly passed Ark Code Ann § 14-59-119 which requires the City to assess transaction fees associated with debit card and credit card payments unless the City Council "determines that the transaction fee is included in the amount charged for the service or product for which a credit card or debit card payment is made."; and WHEREAS, the City is in the process of implementing a new Development Services software called EnerGov that will allow customers to pay by credit or debit card for permits, inspections, HMR and supplemental beverage taxes, and business licenses through a new streamlined portal; and WHEREAS, staff is recommending the assessment of a 2.95% fee, which is the average of transaction fees for payments to the City based on 2019 data, on all credit card and debit card transactions other than payment of utility bills (including recycling and trash collection charges that are included in monthly utility bills) and parking fees which include the transaction fees in the amounts charged for those services and products. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF Page 1 Printed on 5119120 Ordinance 6315 File Number: 2020-0389 FAYETTEVILLE, ARKANSAS: Section l: That the City Council of the City of Fayetteville, Arkansas hereby determines, pursuant to Ark. Code Ann. § 14-59-119(b)(3) that the credit card or debit card transaction fee is included in the amount charged for utility bills (including recycling and trash collection charges that are included in monthly utility bills) and paid parking fees. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves the assessment of a 2.95% fee for credit card and debit card transactions other than payment of utility bills (including recycling and trash collection charges) and paid parking fees. PASSED and APPROVED on 5/19/2020 Attest: J\3 Y 0'F� FAYETTEVILLE ; Kara Paxton, City Clerk Treasure, "';i (NGTOtA Page 2 Printed on 519120 City of Fayetteville, Arkansas 113 West Mountain Street ,. Fayetteville, AR 72701 (479) 575-8323 =u ; Text File File Number: 2020-0389 Agenda Date: 5/19/2020 Version: 1 Status: Agenda Ready In Control: City Council Meeting File Type: Ordinance Agenda Number: C. 1 CREDIT CARD AND DEBIT CARD TRANSACTION FEES: AN ORDINANCE TO APPROVE THE ASSESSMENT OF A 2.95% FEE FOR CREDIT CARD AND DEBIT CARD TRANSACTIONS OTHER THAN UTILITY BILL AND PARKING FEE PAYMENTS WHEREAS, the City currently accepts credit card payments for utility bills, recycling and trash invoices, airport hangar rental and supply purchases, animal shelter fees, building permits, business licenses, miscellaneous billing of City services, parking, and miscellaneous Police fees and has always absorbed the transaction fees for those payments; and WHEREAS, in 2019, the Arkansas General Assembly passed Ark Code Ann § 14-59-119 which requires the City to assess transaction fees associated with debit card and credit card payments unless the City Council "determines that the transaction fee is included in the amount charged for the service or product for which a credit card or debit card payment is made."; and WHEREAS, the City is in the process of implementing a new Development Services software called EnerGov that will allow customers to pay by credit or debit card for permits, inspections, HMR and supplemental beverage taxes, and business licenses through a new streamlined portal; and WHEREAS, staff is recommending the assessment of a 2.95% fee, which is the average of transaction fees for payments to the City based on 2019 data, on all credit card and debit card transactions other than payment of utility bills (including recycling and trash collection charges that are included in monthly utility bills) and parking fees which include the transaction fees in the amounts charged for those services and products. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby determines, pursuant to Ark. Code Ann. § 14-59-119(b)(3) that the credit card or debit card transaction fee is included in the amount charged for utility bills (including recycling and trash collection charges that are included in monthly utility bills) and paid parking fees. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves the assessment of a 2.95% fee for credit card and debit card transactions other than payment of utility bills (including recycling and City of Fayetteville, Arkansas Page 1 Printed on 511912020 File Number: 2020-0389 trash collection charges) and paid parking fees. City of Fayetteville, Arkansas Page 2 Printed on 511912020 City of Fayetteville Staff Review Form 2020-0389 Legistar File ID S/19/2020 City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Keith Macedo 5/4/2020 INFORMATION TECHNOLOGY (170) Submitted By Submitted Date Division / Department Action Recommendation: Staff recommends approving a credit card fee structure for citywide online and over the counter credit card and debit card sales due to a 2019 legislative change pursuant to Ark Code Ann. § 14-59-119. Budget Impact: Various Account Number Various Fund Project Number Project Title Budgeted Item? NA Current Budget Funds Obligated Current Balance 5 Does item have a cost? No Item Cost ' Budget Adjustment Attached? NA Budget Adjustment Remaining Budget Purchase Order Number: Change Order Number: Original Contract Number: Comments: Previous Ordinance or Resolution # Approval Date: V20180321 CITY OF FAYETTEVILLE ARKANSAS MEETING OF MAY 19, 2020 TO: Mayor and City Council THRU: Paul Becker, Chief Financial Officer Susan Norton, Chief of Staff CITY COUNCIL MEMO FROM: Keith Macedo, Director of Information Technology DATE: April 23, 2020 SUBJECT: Staff recommends approving a credit card fee structure for citywide online and over the counter credit card and debit card sales due to a 2019 legislative change pursuant to Ark Code Ann. § 14-59-119. RECOMMENDATION: Staff recommends approving a credit card fee structure for citywide online and over the counter credit card and debit card sales due to recent change in the state statutes (Ark. Code Ann. § 14- 59-119) and to coincide with the implementation of EnerGov's Development Services software. BACKGROUND: The City currently accepts credit card payments for Utility bills, Recycling and Trash invoices, Airport hangar rental and supply purchases, Animal shelter fees, building permits, business licenses, miscellaneous billing of City services, Parking, and miscellaneous Police fees. Prior to the 2019 legislative session, the State Statutes did not address the acceptance of credit and debit cards and associated credit and debit card transaction fees. In July of 2019 the State of Arkansas passed Ark Code Ann § 14-59-119 which directed municipalities on how the transaction fees associated with the accept and process debit card and credit card payments must be handled. The new statute prescribed: "A municipality may accept a legal payment and any associated costs through a debit card or credit card in accordance with applicable state and federal law. (b)(1) A municipality may enter into a contract with a credit card or debit card company and pay any fee normally charged by the card or debit card company for allowing the municipality to accept the credit card or debit card as payment as authorized under subsection (a) of this section. (2) When a payment is made through a credit card or debit card, the municipality shall assess a transaction fee equal to the amount charged to the municipality by the credit card or debit card company. (3) A municipality shall not assess a transaction fee for payments made through a credit card or debit card if the governing body of the municipality determines that the transaction fee is included in the amount charged for the service or product for which a credit card or debit card payment is made." Mailing Address: 113 W. Mountain Street www.fayetteville-ar.gov Fayetteville, AR 72701 The City accepts credit card and debit cards for the majority of transactions processed in person and online but has configured all current credit card systems to not pass any of the credit card fees. The credit card fees are comprised of a fixed transaction fees and a percentage of each transaction, which average about 2.95 % per transaction. Due to the different types of credit card and debit cards, there are hundreds of different credit card transaction fee rates and percentages, based upon the type of card used by the customer (consumer, business, reward card, etc..). Therefore, an average transaction cost fee is a practical solution if a transaction fee is to be applied. DISCUSSION: The City is in the process of implementing a new Development Services software called EnerGov that will allow customers to pay by credit or debit card for Permits, Inspections, HMR, Supplemental Beverage, and Business licenses through a new streamlined portal. Currently the majority of these fees are either taken in person or via a mailed in check. Staff is recommending a 2.95% pass through credit card transaction fee to pay for the transaction costs associated with providing this new service. Since this could be significant fee for large transactions, we still provide the option for customers to pay with a check or cash, which are not subject to transaction fees. We think the benefit of the new streamlined portal, to easily make online payments for permits and fees, will drive customers to utilize the online payment option for smaller transactions and provide them a convenient option. City staff has reviewed the new state statute law and is recommending we absorb all credit card fees related to Utility payments (including monthly utility charges relating to Recycling and Trash Collections included on the monthly utility bill) and Parking related transactions because they can be incorporated in the established rates charged the customer. The City is recommending passing credit card fees to customers on all other transactions according to state law. This will enable the City to consolidate many transaction types processed allowing the City to begin accepting transaction online for payments as such as HMR and Supplemental Beverage fees via credit card without affecting the final amount of the fee collected which is needed to fund operations. BUDGET/STAFF IMPACT: The average transaction fee is estimated to be 2.95% per transaction based on 2019 data, regardless of whether it is purchased online or in in person with a credit card or debit card. However, Staff is recommending a beginning 2.95% fee be assessed on all credit card transactions other than Utility Bills and Parking Fees. If approved the amount of this fee will be reviewed and adjusted to actual experience on an annual basis. The overall impact to the customer would be to provide an additional payment option for many City transactions. Attachments: Staff review form, staff review memo, state statue 14-59-119 12 . itec'EAVED 4N 15 ZD2� Democrat 10 (bazette P.C. RCX 607, FAYE i EVILL"e, AR, 727C2 - `0 442.170C - FAX ; ig-o95-IIiS - WWW NWADC: COM AFFIDAVIT OF PUBLICATION I, Brittany Smith, do solemnly swear that I am the Accounting Legal Clerk of the Northwest Arkansas Democrat -Gazette, a daily newspaper printed and published in said County, State of Arkansas; that I was so related to this publication at and during the publication of the annexed legal advertisement the matter of: Notice pending in the Court, in said County, and at the dates of the several publications of said advertisement stated below, and that during said periods and at said dates, said newspaper was printed and had a bona fide circulation in said County; that said newspaper had been regularly printed and published in said County, and had a bona fide circulation therein for the period of one month before the date of the first publication of said advertisement; and that said advertisement was published in the regular daily issues of said newspaper as stated below. City of Fayetteville Ord 6315 Was inserted in the Regular Edition on: May 31, 2020 Publication Charges: $173.28 Brittany §mith Subscribed and sworn to before me This 2 day oIVX-2020. Notary Public co — My Commission Expires: phi W 1v5 **NOTE** Please do not pay from Affidavit. Invoice will be sent. CATHERINE STAGGS MY COMMISSION ti 12402772 EXPIRES: February 28, 2025 Washington County Ordinance:6315 File Number: 2020-0389 CREDIT CARD AND DEBIT CARD TRANSACTION FEES: AN ORDINANCE TO APPROVE THE ASSESSMENT OF A 2.95% FEE FOR CREDIT CARD AND DEBIT CARD TRANSACTIONS OTHER THAN UTILITY BILL AND PARKING FEE PAYMENTS WHEREAS, the City currently accepts credit card payments for utility bills, recycling and trash invoices, airport hangar rental and supply purchases, animal shelter fees, building permits, business licenses, miscellaneous billing of City services, parking, and miscellaneous Police fees and has always absorbed the transaction fees for those payments; and WHEREAS, in 2019, the Arkansas General Assembly passed Ark Code Ann § 14-59- 119 which requires the City to assess transaction fees associated with debit card and credit card payments unless the City Council "determines that the transaction fee is included in the amount charged for the service or product for which a credit card or debit card payment is made."; and WHEREAS, the City is in the process of implementing a new Development Services software called EnerGov that will allow customers to pay by credit or debit card for permits, inspections, HMR and supplemental beverage taxes, and business licenses through a new streamlined portal; and WHEREAS, staff is recommending the assessment of a 2.95% fee, which is the average of transaction fees for payments to the City based on 2019 data, on all credit card and debit card transactions other than payment of utility bills (including recycling and trash collection charges that are included in monthly utility bills) and parking fees which include the transaction fees in the amounts charged for those services and products. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE. Section 1: That the City Council of the City of Fayetteville, Arkansas hereby determines, pursuant to Ark. Code Ann. § 14-59-119(bx3) that the credit card or debit card transaction fee is included in the amount charged for utility bills (including recycling and trash collection charges that are included in monthly utility bills) and paid parking foes. Section 2: That the City Council of the City of Fayetteville, Arkansas hereby approves the assessment of a 2.95% fee for credit card and debit card transactions other than payment of utility bills (including recycling and trash collection charges) and paid parking fees. PASSED and APPROVED on 5/19/2020 Approved: Lioneld Jordan, Mayor Attest: Kara Paxton, City Clerk Treasurer 75276425 May 31, 2020 Automated Merchant Services, Inc. Keith Macedo Submitted By City of Fayetteville Staff Review Form 2020-0727 ;istar File ID N/A City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item 8/26/2020 INFORMATION TECHNOLOGY (170) Submitted Date Division / Department Action Recommendation: Staff recommends approving the attached agreement with Automated Merchant Services, Inc. (AMS) for credit card processing related to Tyler EnerGov payments. Budget Impact: Various Various Account Number Fund Project Number Project Title Budgeted Item? NA Current Budget Funds Obligated Current Balance Does item have a cost? No Item Cost Budget Adjustment Attached? NA Budget Adjustment Remaining Budget V20180321 Purchase Order Number: Previous Ordinance or Resolution # Change Order Number: Approval Date: nR/?7/)n Original Contract Number: Comments: CITY OF FAYETTEVILLE %PF ARKANSAS TO: Mayor Lioneld Jordan THRU: Susan Norton, Chief of Staff FROM: Keith Macedo, Information Technology Director STAFF MEMO DATE: August 26, 2020 SUBJECT: Staff recommends approving the attached agreement with Automated Merchant Services, Inc. (AMS) for credit card processing related to Tyler EnerGov payments. RECOMMENDATION: Staff recommends approving the attached agreement with Automated Merchant Services, Inc. (AMS) for credit card processing related to Tyler EnerGov payments. BACKGROUND: The City accepts credit card payments throughout the City for various products and services. In 2018 the City began the process of consolidating credit card processors to as few companies as possible to improve efficiency and reduce management overhead. City Council approved an agreement with Automated Merchant Systems (AMS), Inc. at the March 6, 2018 meeting via ordinance 6044. This agreement waived formal competitive requirements due to the integration of AMS and the City's Tyler New World ERP financial system. In addition, City Council approved Ordinance 6315 which authorizes the City to charge a transaction fee for Development Services related fees on July 7, 2020. DISCUSSION: The attached agreement changes the transaction fee collection process from City managed to AMS managed. Over the last 2 months City staff attempted to configure EnerGov and ERP Revenue Collections to calculate and process the transaction fees to ensure adequate financial controls were implemented and the process was efficient for staff to manage. Staff worked with EnerGov and Tyler New World ERP staff and spent a significant amount of time configuring and testing the system but were not satisfied with the results. Due to this staff is recommending AMS process all transaction fees which will reduce the complexity, reduce staff time, and improve financial controls related to EnerGov credit card transaction fees. The attached agreement simply changes how transaction fees are processed from City managed to AMS managed. BUDGET/STAFF IMPACT: As documented in the attached agreement the credit card processing fees will be 2.95% per transaction, which is what is approved in Ordinance 6315. Attachments: Staff review form, Staff review memo, AMS Agreement Mailing Address: 113 W. Mountain Street www.fayetteville-ar.gov Fayetteville, AR 72701 SERVICE FEE AMENDMENT TO MERCHANT PROCESSING AGREEMENT This Amendment to the Merchant Processing Agreement ("Amendment") entered into as of September 1, 2020 ("Amendment Effective Date") and is by and among Merrick Bank Corporation, a Utah industrial banking corporation ("Member Bank"), Automated Merchant Systems, Inc. ("AMS") and the government entity signing below (the "Merchant") and amends that certain Merchant Processing Agreement dated as of March 29. 2018 (the "Agreement") to reflect an initial Merchant Funded and/or Convenience Fee program to be converted to a Service Fee program (the "Program"). Member Bank, AMS and the Merchant agree the Program contained in this Amendment shall supersede and prevail over any contradictory or inconsistent terms and conditions contained in the Agreement, as amended from time to time, and agree further that all capitalized terms used, but not otherwise defined herein, shall have the meanings assigned thereto in the Agreement. The following Fee Schedule will be added to the original Fee Schedule: The Fee Schedule You understand and acknowledge you have elected to participate in the Service Fee Program (the "Program"). The Program allows registered and approved merchants (approved Merchant IDs or MIDs) to assess a variable service fee (a "Service Fee") on certain debit and credit card transactions. Registration and participation in the Program are subject to approval by the applicable Payment Brands and you acknowledge that you may not be eligible to participate in the Program. If registration and Payment Brand approval is obtained, you agree to comply with all Program requirements. ISO (AMS) may terminate, amend, modify or otherwise alter this Agreement, the Program, or the structure, nature or amount of the Service Fee at any time with written notice to you. You authorize and direct Member Bank to settle the proceeds received for Service Fees into the ISO's bank account. In the event you receive any portion of the Service Fees, you agree to promptly pay such amounts to ISO. Service Fees collected by ISO will be retained by ISO and you will not be responsible for the payment of any Fees or Third - Party Costs except the Fees disclosed below. Nothing in this Section shall be deemed to alleviate or reduce any of your other obligations under the Agreement, including, but not limited to, your responsibilities regarding Penalties and Dispute Items and your obligation to pay early termination fees, if applicable, pursuant to Section 10 of the Merchant Processing Agreement. The following Merchant Locations will participate in the Service Fee program: Merchant Location Name Merchant Number (MID) Fayt AR Dev Svcs OTC 730295363 Fayt AR Dev Svcs WEB 730299521 The following Service Fees will apply to participating Merchant Locations: Transaction Type Service Fee Visa, Mastercard and Discover 2.95% with a $2.00 minimum Except as expressly modified hereby, the terms and conditions of the Agreement remain in full force and effect and are incorporated herein by reference. IN WITNESS WHEREOF, the partie$ hereto have executed this Amendment by their duly aut 'zed representatives. Automated Merchant Sys s, Mc. City of tteville A By: By: TMe: President /� Title: Mavodll