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Published Friday, January 14, 2011 12:05 AM
The College Station City Council on Thursday authorized its departments to impose a $3 fee on service payments they collect from credit cards.
That fee will at first only be collected by the municipal court and jail but could eventually be expanded across the city. It will provide new revenue during tight budget times and, city staff said, offset the growing cost the city incurs by accepting credit card payments.
The city began accepting credit cards in 2003 because more payments can be accepted by fewer employees than with cash or checks.
“Doing more transactions by credit card would reduce the staff and the need to have additional staff as the city grows,” said City Manager Glenn Brown, explaining the rationale when the council approved the idea in 2001.
But allowing the cards has actually begun to cost the city money as the number of people using them increases.
Credit card processors charge an average of $1.67 for each payment the city collects. The city currently absorbs that cost, but has seen the number of card transactions grow by 433 percent in the past six years.
The city paid about $615,000 in fees in 2010, a 274 percent increase from six years ago. If it had collected a $3 fee for each credit card transaction, it would have brought in $1.1 million in additional revenue — more than enough to offset the costs. But only collecting fees from the municipal court and jail, which combine for about 9 percent of fees paid by the city, will bring in a fraction of that amount.
The vast majority of transactions, 75 percent, are on utility bills. For the short term, no fee will be imposed on people who use credit cards to pay their utility bill — in part because College Station Utilities considers the fees when it determines its rates. However, council members did direct staff to look at offering discounts for people who don’t pay their utilities with credit cards.
The average credit card fee paid by the city in 2010 was $1.76. City staff said it recommended that the council set its fee for $3 because the amount charged by the credit card companies fluctuates, but the city’s fee must remain stable. The extra money raised by the fee would go into the city’s general fund, said Cheryl Turney, assistant finance director for the city.
The resolution allowing city staff to impose the fees was unanimously approved by the council.
“The motive was to be fiscally responsible and cover our costs, and from what I understand this is not about producing more revenue, it is about trying to be more responsible and cover our costs,” said Councilwoman Katy-Marie Lyles.
Also approved was a $25 fee for people who fail to appear at a municipal court hearing. That fee will provide an estimated $33,000 to the city.
The council voted 6-1 in favor of a thorough update of the standards that new subdivisions must meet to be built in the city limits.
The update of subdivision standards was the most extensive the city has done since the 1970s, said Planning Director Bob Cowell. It focused on making the city more connectable and attractive, city staff said.
Substantial changes included requiring subdivisions to put sidewalks on both sides of new streets within a year of the street’s construction. Sidewalks would also be required on cul de sacs.
The new rules also regulate block length, which should be shorter in dense urban areas and longer in more rural areas.
Jana McMillan was the only member of the council to vote against the new regulations.
In other action, the council:
* Awarded a $685,000 contract with JaCody Inc. to build a skatepark at the Southwood Athletic Complex on Rock Prairie Road. Funding for the project was approved by voters in a 2008 bond package. The city hopes to open the park in October.
The council also approved a $2.5 million contract with Dudley Construction to rehabilitate Tauber and Stasney streets behind Northgate. That project is expected to be complete in October.
* Gave city staff the authority to seek contracts to build the final phase of the College Station Bike Loop Project, a 4.5-mile bike path, and improvements to Royder Road and Greens Prairie Trial. Funding for both projects had already been approved.
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Article source: http://www.theeagle.com/local/CS-council-OKs-new-credit-card-fee
Category: Identity Theft Watch