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NHGFOA Annual Conference May 1, 2008

2. Authority. Consult legal counselTITLE V - TAXATIONCHAPTER 80 - COLLECTION OF TAXESMiscellaneous Provisions - Section 80:52-c

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NHGFOA Annual Conference May 1, 2008

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    1. NHGFOA Annual Conference May 1, 2008 Dana Call, Town of Windham Sharon Wickens, City of Manchester

    2. 2 Authority Consult legal counsel TITLE V - TAXATION CHAPTER 80 - COLLECTION OF TAXES Miscellaneous Provisions - Section 80:52-c     80:52-c Payment by Credit Card. – The legislative body, by ordinance adopted in accordance with RSA 39, may authorize the municipality's treasurer or other appropriate municipal official to accept payment of local taxes, charges generated by the sale of utility services, or other fees by use of a credit card. Any municipality adopting such an ordinance may add to the amount due, in addition to any penalties and interest payable, a service charge for the acceptance of the card. The municipality, at the time of billing, shall disclose the amount of the service charge. Source. 1994, 2:2. 1995, 137:4, eff. May 24, 1995. 2001, 78:2, eff. Aug. 18, 2001. Involve Town Treasurer

    3. 3 Credit card vs. Debit card TITLE XXXI TRADE AND COMMERCE CHAPTER 359-I IDENTITY THEFT Section 359-I:1 [RSA 359-I:1 effective January 1, 2008.]     359-I:1 Definitions. – In this chapter:     I. ""Financial device'' means any instrument or device that can be used to obtain cash, credit, property, services, or any other thing of value or to make financial payments, including but not limited to any of the following:        (a) A credit card, banking card, debit card, electronic fund transfer card, or guaranteed check card.        (b) A check.        (c) A negotiable order of withdrawal.        (d) A share draft.        (e) A money order.        (f) An Automated Clearing House (""ACH'') or other electronic transaction.        (g) Any device or process, whether based on a binary or digital code used to transfer value from one person or entity to another.     II. ""Personal information'' shall include any one or more of the following, whether the information is owned by or assigned to the person it relates to:        (a) A first and last name of a user, whether given at birth or adoption, assumed, or legally changed.        (b) A home or physical address.        (c) A telephone number.        (d) A social security number.        (e) Any personal identification number.        (f) A credit or debit card number.        (g) Any access code associated with a credit or debit card.        (h) A date of birth, birth certificate number, or place of birth.        (i) A password or access code.        (j) A financial institution account number.        (k) A driver's license or other governmental identification.    

    4. 4 Example Town Ordinance ORDINANCE: ACCEPTING PAYMENTS BY CREDIT CARD:   SECTION I : PURPOSE: The purpose of this Ordinance is to authorize the Town of ______’s Treasurer or other appropriate municipal official to accept payment by credit cards of taxes, charges generated by the sale of utility service, or other fees.  SECTION II : AUTHORITY: This Ordinance has been enacted pursuant to the statutory authority granted to the Town of_____ by RSA 80:52-c and in accordance with procedures as outlined in RSA 39.  SECTION III : DEFINITIONS: “Town” – Town of ______, New Hampshire “Board” – Means the Board of Selectmen for the Town of ______ “Credit Card” – Means any instrument, whether known as a credit card, credit plate, charge plate or by any other name, which purports to evidence an undertaking to pay for goods/services rendered or furnished to or upon the order of a designated person or bearer. “Issuer” – The Bank or other financial institution which has issued the credit card and, under applicable law, is obligated to pay to the Town upon the order of a person using a credit card. “Credit Card Processor” – The company engaged by the Board of Selectmen to provide credit card processing services. “Processing Agreement” – Agreement between the Town and Credit Card Processor governing collection of credit card payments, including any terms relating to the applicability of processing fees, their amount, and the terms and method of remittance of funds to the Town. SECTION IV: PAYMENT AUTHORIZED: Pursuant to statutory authority, the Town does hereby authorize its Treasurer or other appropriate municipal officials to accept payment by credit cards for taxes, charges generated by the sale of utility service or other fees, subject to and governed by the terms of this ordinance. SECTION V : TYPES OF FEES ELIGIBLE FOR PAYMENT BY CREDIT CARD: The Board of Selectmen shall be authorized to determine: The types of payments that may be accepted by credit card. The maximum amount of any individual credit card transaction which shall be allowable for any particular transaction. Whether (to the extent allowable by the Processing Agreement) service charges shall be charged and the amount thereof. See, Section VII below.

    5. 5 Example Town Ordinance, cont’d   The Board shall hold a public hearing prior to making the final determination of the types of fees for which credit cards will be accepted and any maximum transaction limits imposed, as well as prior to terminating the ability to pay a fee by credit card. Notice of the time, place and subject of such hearing will be published in a newspaper of general circulation in the Town at least seven (7) days before the hearing is held. In the case of termination, at least sixty (60) days’ notice will be provided to the residents if payments will no longer be accepted by credit card.  SECTION VI: PROCESSING AGREEMENT:   The Board is authorized to negotiate and execute a Processing Agreement with a Credit Card Processor. Said agreement shall specify the scope of services to be provided, the length of the agreement, and the service charges to be charged. The Board shall periodically review, and as needed, revise said agreement, and where deemed in the best interest of the Town, terminate any such agreement. SECTION VII : SERVICE CHARGES: The Town shall not impose service charges (processing fees) on any transaction where the Processing Agreement prohibits the separate imposition of such fees over and above the amount otherwise due to the Town. In the case of property or utility tax payments, there may be added to each amount due, a service charge to cover processing fees required under the Processing Agreement and any other actual costs for the use of the credit card services. The Board shall establish/amend service charges in accordance with the procedure in RSA 41:9-a. All service charges shall be disclosed to the customer at the time of billing. SECTION VI : HANDLING OF PAYMENTS:   In accordance with RSA 41:9, the Board of Selectmen shall include in its internal control policies, procedures governing the collection, handling, and retention of receipts, statements and any other documentation generated from each credit card payment, whether the transaction is conducted over the counter or via the internet, to ensure all information collected from customers is safeguarded.  SECTION VII : EFFECTIVE DATE/ENACTMENT:   The provisions of this ordinance shall take effect upon adoption by Town Meeting. Adopted at Town Meeting: March XX, 200X  

    6. 6 Example Warrant Article May 2001 Town Meeting: ARTICLE TWENTY-ONE: To see if the Town, in accordance with RSA 80:52-c, will vote to authorize the acceptance of payment by credit cards of taxes, charges generated by the sale of utility service, or other fees, provided that there shall be added to each amount due a service charge to cover the credit card company's charges to the Town and any other actual costs for the use of the credit card service. RSA Amended…… May 2006 Town Meeting:   ARTICLE THIRTY-THREE: To see if the Town will ratify the action taken at the May 8, 2001 Town Meeting to allow the Town, in accordance with RSA 80:52-c, to authorize the acceptance of payment by credit cards to allow the Town to absorb the credit card processing fees for certain payments; however, this ratification will not apply to the payment of taxes or utility services. Change due to certain credit card company rules that prohibit merchants from “passing along” service charges to the customer, other than for tax payments, if swiping the card over the counter (i.e. can’t treat credit card paying customer different than those paying via cash or checks) Could avoid this by utilizing on-line payments or a separate kiosk in which the customer, not clerk, enters the payment

    7. 7 Credit Card Processing Agreement Types of fees to accept credit cards: (i.e. recreation, building department, parking fines) Pricing based on average # and $ amount of transactions Periodic pricing reviews Transaction minimums/maximums Length of contract (3-5 years) Monthly statement fees

    8. 8 City of Manchester Accepting of Credit Card Payments Manchester – Boston Regional Airport Parking Recreation Department Derryfield Country Club McIntyre Ski Area Environmental Protection Division Sewer Water Department Water Parking Department Parking Parking tickets/violations (due to go live 05/15/08)

    9. 9 Cost Options to Consider There is a cost to implementing and providing credit card service Enterprise Funds Bank and processing fees will be absorbed within the revenue. Establish a convenience fee per transaction that will cover all bank and processing fees. Establish a convenience fee per transaction that will share in the costs of bank and processing fees. General Fund Establish a convenience fee per transaction that will cover all bank and processing fees.

    10. 10 Advantages Accepting credit card payments provides constituents with a convenient, 24/7 ability to access and pay for municipal services. Reduction in payment default rates. Increases the efficiency of payment method. Accelerated payments and the availability of funds.

    11. 11 Payment Card Industry (PCI) Compliance Municipalities are responsible to ensure that transactions are PCI compliant to avoid significant financial penalties. https://www.pcisecuritystandards.org

    12. 12 Questions/Contact Info Dana Call – dcall@windhamnewhampshire.com Sharon Wickens – swickens@manchesternh.gov Other Resources – www.nhgfoa.org

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