City Council considers fee for utility payments made with credit cards

Monday, February 20, 2012 | 10:51 p.m. CST

COLUMBIA — The City Council is considering charging a service fee to those who pay utility bills with credit cards.

The council voted Monday to redraft an existing amendment permitting the city's finance director to offer discounts to the city's biggest utility customers in exchange for bills paid in cash.

In lieu of a discount for "large volume utility customers," Mayor Bob McDavid proposed that all customers paying with credit cards should be charged an additional service fee. The ambiguity of his proposal left the specific value of that fee to the discretion of city staff.

The council endorsed McDavid's revision in light of a two-year, 260 percent increase in processing fees incurred by the city as a the result of utilities payments made by credit card. Such charges amounted to $462,649 in fiscal year 2011, according to a city memo.

The mayor said courtesy charges like the one he suggested are "standard procedure among most organizations." Consumers are subject to similar fees when charging payments such as MU tuition and electronic rent submissions to credit cards.

McDavid then pointed to net equilibrium, not counterbalancing fees with discounts, as his ultimate goal.

"If we bill $2.8 million, I'd like to receive $2.8 million," McDavid said in reference to the utility bill from Columbia Public Schools. The district's use of credit cards resulted in a $50,000 cost to the city last year, the Columbia Daily Tribune reported Sunday.

Despite unanimous support, the mayor's rewrite will not be enacted immediately. Pending a report on its legality and details of its implementation, the amendment has been tabled for two weeks.

The language approved Monday will be reconsidered at the council's March 5 meeting.

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