CR 01-107 Merchant Credit Card Services
C\IY OF
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HOPKINS
August 2, 2001
Council Report 2001-107
MERCHANT CREDIT CARD SERVICES
Proposed Action
Staff recommends adoption of the following motion: Move to approve implementation
of merchant credit card use at all city locations.
Overview
Recently finance conducted a brief survey of departments to determine whether or not
customers have been inquiring about credit and debit card use for services. The
response was overwhelming "YES".
Finance met with Wells Fargo to determine cost and feasibility of implementing
VISA/Master card processing at all city locations. The initial set up and equipment
costs are approximately $3,000. The projected processing costs on a monthly basis
are estimated to be $1,500. These costs may be offset by having a larger deposit in
the bank at Wells Fargo or by increasing fees slightly.
Primary Issues to Consider
. Lost interest earnings.
. Higher fees charged to customers to cover costs.
. Ease of transactions
. Possible internet payment processes enabled.
Staff recommendation
Finance recommends moving forward with implementing merchant credit card services
at five locations. They are; City Hall, Activity Center, Pavillionllce Arena, Art Center and
the Depot Coffee House. We also recommend initially increasing the deposit amount at
Wells Fargo and forgoing some interest earning potential to cover the costs. Further
analYS),S will ~e as to fee increases relative to amount of activity at locations.
~
Lori Yager ... ./'-
Finance Director
Financial Impact: $_20,000_ _Budgeted: Y/N _N_ Source: _All funds
Related Documents (CIP, ERP, etc.):
Notes: Finance will absorb charges through lower interest earnings