DATE: October 17, 2012 REPORT NO. CS TYPE OF REPORT CONSENT ITEM [ ] ITEM FOR CONSIDERATION [ x ]

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1 ok DATE: October 17, 2012 REPORT NO. CS TO: Chair and Members of Finance Committee FROM: Catherine Brubacher City Treasurer, Director of Finance 1.0 TYPE OF REPORT CONSENT ITEM [ ] ITEM FOR CONSIDERATION [ x ] 2.0 TOPIC Credit card payments for City of Brantford programs and services. 3.0 RECOMMENDATION A. THAT the City should continue to offer the use of credit card payments for face to face transactions and; B. THAT City staff be directed to issue a Request for Proposals to explore a third-party payment provider for the E-Government initiative for payment of programs and services on-line and report back to Finance Committee with the results. 4.0 PURPOSE To report to Council the current practice at the City of Brantford regarding credit card payments and to investigate the possibility of using third-party vendors to process credit card payments for City programs and services on-line. 5.0 BACKGROUND Staff has previously been directed to investigate third-party vendors to process credit card payments for municipal property taxes and other City services which have a zero impact on the City (Option 2 as outlined in the January 25, 2011 memorandum from the City Treasurer, Director of Finance) and report back to Council.

2 Date: October 17, 2012 Page CORPORATE POLICY CONTEXT Excellence in Governance and Municipal Management by providing additional payment options to the customers of the City of Brantford with no additional budget impact. 7.0 INPUT FROM OTHER SOURCES All City departments that currently accept card payments. IT Services provided information on the E-Government initiative. Municipal websites provided information on who is currently using third-party payment providers. 8.0 ANALYSIS Credit Card Charges - Current Practice The charge related to the use of credit cards depends upon both the type of card used and the method by which it is used. Visa and MasterCard both charge extra fees, note the range in chart below, for using their cards and when you do not swipe or insert the credit card into a machine (i.e. the card is not presented at the time of purchase). The City currently pays the following fees when a program or service is paid by credit card: Visa 1.54% to 1.85% MasterCard 1.59% to 2.65% American Express 2.00% to 3.25% PCI Compliant Fee per machine Quarterly $39.19 Equipment Rentals - Monthly $36.16 In 2011, the City paid our payment processing provider approximately $120,000 for credit card charges, debit card charges and monthly equipment rentals. In this amount approximately $64,500 was attributed to Visa, MasterCard and American Express charges, the balance is made up of equipment rentals, debit card charges and payment card industry data security standard fees (PCI). The City cannot charge a convenience fee or recoup any of the payment processing charges directly from our customers when they pay for face to face transactions using a credit card. The merchant agreement with Moneris, the City s service provider for payment processing states that: You will not discriminate as to the conditions of a sale if a Card is presented as a form of payment nor will you discriminate against or discourage the use of any particular Card brand. For example, you will not charge a fee

3 Date: October 17, 2012 Page 3 or surcharge on Credit Card Transactions, or set a minimum or maximum value for accepting Cards. Both Visa and MasterCard have similar clauses in their Merchant agreements. Third-party vendors avoid this restriction by charging the customer a convenience fee for the use of paying on-line. Most departments do not have on-line payments which still leave the bulk of the City s programs and services without on-line payment options. The City of Brantford currently accepts credit card payments at most locations throughout the City for a wide range of programs and services not including property taxes and a few other specific areas. Customers are able to pay for these programs and services using credit cards in face to face transactions, web payments on-line and telephone payments. Below is a chart which outlines the departments that currently take credit card payments and the goods and services a customer can purchase using this method. Department Arrowdale Golf Course Beckett Adult Leisure Centre Bell Homestead Museum & Café Branlyn Community Centre Business Resource Centre Civic Centre Services Purchased Green fees, memberships, pro-shop purchases, restaurant Memberships, program registrations Food items, gifts, souvenirs, admissions, day camp registration Hall Rental, programs registrations Business name registrations, name search, City directory publication, seminar registration Season Tickets for Blast, Ice rentals and auditorium rentals Clerks Eagle Place Community Centre Earl Haig Engineering Services Finance Landfill Mt. Hope Cemetery Northridge Golf Course Oakhill Cemetery Parks & Recreation Police Provincial Offences Business licenses, dog licenses, raffle/nevada/bingo licenses, marriage licenses, freedom of information requests, death registrations, taxi licenses, commissioner of oath documents, sale of publications of materials, proclamations, etc. Hall Rental, programs registrations Admissions, tent rentals and concession booth Tender documents, site alteration permits, plans, driveway permits, drafting prints, time exemption permits Brantford Power payments Tipping Fees Plots, interment fees and flower program Green fees, memberships, pro-shop purchases, restaurant, hall rentals, weddings and other events Plots, interment fees and flower program Program registrations, Hall Rentals, Aquatic lessons and any other programs or services that Parks and Recreation offer Clearance letters, incident/accident report, taxi licenses, fingerprinting, FOI reports, special duty charges Fines, court transcripts

4 Date: October 17, 2012 Page 4 Department Purchasing Sanderson Centre Steve Brown Sports Complex TB Costain Community Centre Tourism Wayne Gretzky Sports Centre-Aquatics Wayne Gretzky Sports Centre-Arena Woodman Community Centre and Pool Services Purchased Tender documents Box office ticket sales, theatre rentals Ice rentals, arena floor rentals, auditorium rentals Hall Rental, programs registrations Souvenirs with City of Brantford logo, seminar/workshop registrations, advertising in Discovery Guide Swimming lessons, advanced aquatic leadership registrations, CPR masks, goggles, various items with Gretzky logo, birthday party packages, punch cards for various programs Ice rentals, field rentals Hall rentals, program registrations, punch cards for drop in programs, swimming lessons, birthday party packages, swim passes The following divisions do not accept credit card payments: Property Taxes Building Planning Parking Services Transit Housing Rent Child Care On-Line Payments There are currently three departments that offer on-line payments: 1. Sanderson Centre Sanderson Centre has a secure ticketing system called Theatre Manager that processes all on-line ticket sales. Theatre Manager does not have their own hosted service; therefore it must reside on our City s servers. This is the only on-line method for ticket purchases. For example, you cannot purchase performance tickets for the Sanderson Centre through Ticketmaster. There is a service fee of $5.00 per order which is intended to offset box office costs such as ticket printing and staff time. Sanderson Centre does not pay credit card charges on the shows where the facility is rented by the performer/group. However, for the shows that Sanderson Centre runs, the credit card charges are an expense to the City.

5 Date: October 17, 2012 Page 5 2. Parks and Recreation Parks and Recreation has an on-line registration system called RecConnect which is hosted by the software vendor, Active Network. There are no convenience fees or service fees passed on to customers using this service. Active Network pays for the credit card charges incurred for all transactions. Active Network in turn charges the City monthly fees based on a set percentage of the event fee (program registration, etc.) and a fixed dollar amount per transaction. 3. Provincial Offences Provincial Offences accept on-line payments through a third-party website called Payfines. The customer is charged a non-refundable convenience fee of $2.50 in addition to the fine paid. This convenience fee is not a fee the City charges and collects. It is solely a fee for Payfines. The City receives a batch file of the payments made on-line and we process the payments through our credit card provider and record the fines paid. The credit card charges are an expense to the City. E-Government The E-Government initiative intends to provide on-line payment options for the following programs and services: Property Tax payments, tax certificates and inquiries Parking ticket payment and permit applications Utility Payment and inquiry Brantford Power and City (Water, Wastewater, Water Heater Rentals EStore Merchandise, directories, purchasing bid documents, punch cards, wreaths, etc. Licenses dog and business Planning Forms Official Plan/Zoning By-Law amendments, subdivision and condo approvals, severance and minor variance, zoning compliance requests Building Forms - Sign permit applications and zoning information Accounts Receivable Facility booking and rental Transportation related permits, street closure, overweight/over length, etc. It is recommended that the City will send out a request for proposal to secure a thirdparty provider for payment processing and the credit card charges will have no budget impact on the City. The third-party provider will be responsible for the credit card charges and charge the customer a fee explained below.

6 Date: October 17, 2012 Page 6 Third Party Vendors Third-party vendors provide a secure web environment where customers can pay for various programs and services that have been set up with us and the third-party vendor charges the customer a convenience fee for the ability to pay by this method. The convenience fee can be applied to any non-face to face payment channel for a bona fide convenience. The convenience fee must be a fixed amount (percentage or dollar), applied to all payment products through the channel and the amount depends on the average dollar value of the transactions. 9.0 FINANCIAL IMPLICATIONS The City will send out a request for proposals for a third-party provider to accept our credit card payments through the E-Government initiative. Implementation of the thirdparty provider will have no additional budget requirements, however will provide the customer with additional options to conduct their City transactions CONCLUSION The existing payment options available have been available for years and to discontinue this would have a negative impact on revenues and customer service. Many municipalities offer the same payment options for face to face transactions and have added on-line payment options with third-party providers. It is recommended that through the E-Government initiative the City should pursue the use of a third-party provider for as many programs and services as possible. The existing agreements with on-line payments providers discussed above should be revisited when they come due so they too will have a zero budget impact to the City where possible. Catherine Brubacher City Treasurer, Director of Finance Darryl Lee General Manager of Corporate Services In adopting this report, is a by-law or agreement required? If so, it should be referenced in the recommendation section. By-law required [ ] yes [ x ] no Agreement(s) or other documents to be signed by Mayor and/or City Clerk [ ] yes [ x ] no Is the necessary by-law or agreement being sent concurrently to Council? [ ] yes [ x ] no