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HomeMy WebLinkAbout09. Establish an electronic payment acceptance account to receive customer payments electronically on a pilot basis (2) Page 1 of 3 Item 9. CENTRAL SAN BOARD OF DIRECTORS vie . , Hill. , , . . POSITION PAPER MEETING DATE: MARCH 19, 2020 SUBJECT: AUTHORIZE THE GENERAL MANAGER TO ESTABLISH AN ELECTRONIC PAYMENT ACCEPTANCE ACCOUNT (EPAA) TO RECEIVE CUSTOMER PAYMENTS ELECTRONICALLY ON PILOT BASIS FOR THE DURATION OF THE CORONAVIRUS (COVID-19) PANDEMIC SITUATION SUBMITTED BY: INITIATING DEPARTMENT: PHILIP LEIBER, DIRECTOR OF FINANCE & ADMINISTRATION-FINANCE ADMINISTRATION REVIEWED BY: KEVIN MIZUNO, FINANCE MANAGER Roger S. Bailey General Manager ISSUE Establishment of an Electronic Payment Acceptance Account (E PAA) to facilitate customer payments remotely during the Coronavirus (COVI D-19) pandemic. BACKGROUND Central San is exploring methods to support national, state and county efforts to mitigate the spread of the COVI D-19 virus, while continuing necessary service to customers. These efforts include facilitating "social distancing" by maintaining recommended spatial distance between individuals in the workforce and in interactions with the public, and by using technology to accomplish tasks that would otherwise involve closer contract between individuals. The latter includes expanding options for customers seeking permits from Development Services and through the Permit Counter to submit their plans to Central San for review, and to facilitate electronic payments for the fees associated with permitting rather than requiring customers to visit Central San in person to make such payments. Credit card companies discourage the acceptance of credit card information via telephone. Alternative, electronic payment methods are viewed as a more secure, and now commonly used, method for entities to accept payment from customers remotely. Central San proposes March 19, 2020 Regular Board Meeting Agenda Packet- Page 44 of 163 AMENDED AGENDA Page 2 of 3 to implement a method to accept electronic payments from customers consistent with this practice. Central San intends to coordinate with Contra Costa County, as the District's Treasurer, in this effort. Several commonly used electronic payment platforms are available, including Cashapp, Venmo, Zelle, Stripe, and PayPal. Central San anticipates using PayPal, as it is widely used, has superior transaction reporting, and the ability to send payment requests to customers. I n the remainder of this Position Paper, the anticipated PayPal account is referred to as the Electronic Payment Acceptance Account (EPAA). Internal controls regarding the establishment and use of this account are anticipated to include the following: 1. Administrator: Two responsible individuals (the General Manager and the Director of Finance and Administration)from Central San would be the only individuals authorized to log in to the EPAA to review payment activity and to remit funds to the linked Bank Account currently in use under the oversight of Contra Costa County). 2. Link to Bank Account: The EPAA would be linked to an existing bank account under the administration of the County already used for certain Central San Disbursements. There would be a one-way transmission of funds from the EPAA to this existing bank account. The EPAA would not be used for other purposes (i.e. transmission of funds to other individuals or entities). 3. Frequency of transmission of Funds: At the end of each week(Friday), funds (if any)would be transmitted from the EPAA to the bank account. 4. Reporting: Weekly, a transaction log from the EPAA would be transmitted to the Contra Costa County Treasurer&Auditor/Controller, as well as provided to the Central San Finance Manager and Finance Administrator for recording/reconciliation. 5. Central San Authorization/Governance: The Board of Directors will authorize the establishment of the EPAA. 6. Set-up: The email account used for payments would be associated with Central San in an apparent way, such as Payments@Centralsan.org, and customers would be informed of the name of the account on the Central San website, and warned that electronic payments related to Central San should not be sent to any other location or account. 7. Other Internal Controls: Activity in the EPAA would be subject to audit by the Central San internal auditor, the County, and Central San's external auditor. Flexible methods of payment are supported by the public, with a 2018 survey indicating that"93% of citizens believe government should offer digital and online payment options." The same survey indicated that PayPal was the most widely desired payment application by the public at 54%. This is a proposed pilot program for the duration of the current COVI D-19 health concerns as evidenced by declarations from county, state and federal authorities. If the electronic payment program is to be extended beyond that time, staff would bring it back to the Board for further consideration. ALTERNATIVES/CONSIDERATIONS Alternatives include: 1. Continuing to require payment of fees in person. This alternative is not recommended as customers will benefit from an additional payment offering given the current need to support social distancing to minimize the potential for the spread of the current illness of concern. 2. Using a different, or more than one EPAA provider. This alternative is not recommended at this time, as offering one EPAA option is viewed as a substantial, and sufficient, increase in customer payment options from the status quo. March 19, 2020 Regular Board Meeting Agenda Packet- Page 45 of 163 AMENDED AGENDA Page 3 of 3 FINANCIAL IMPACTS No material adverse financial impacts are anticipated. Central San currently pays an interchange fee for credit cards accepted at the Permit Counter. A similar fee is anticipated through the EPAA. The preferred E PAA offers a not-for-profit payment fee in the low two percent range that is comparable to the interchange fee paid by Central San related to acceptance of credit cards. COMMITTEE RECOMMENDATION This matter was not reviewed by a Board Committee. RECOMMENDED BOARD ACTION Authorize the General Manager to establish an Electronic Payment Acceptance Account (E PAA)to receive customer payments electronically on a pilot basis for the duration of the Coronavirus (COVI D-19) pandemic situation (and not beyond calendar year 2020 unless extended by the Board). Strategic Plan Tie-In GOAL TWO: Strive to Meet Regulatory Requirements Strategy 3- Comply with all federal, state, and local regulations related to District administration GOAL FOUR: Develop and retain a highly trained and innovative workforce Strategy 3- Meet or exceed industry safety standards GOAL SIX: Embrace Technology, Innovation and Environmental Sustainability Strategy 3- Encourage the review and testing of technology to optimize and modernize business operations March 19, 2020 Regular Board Meeting Agenda Packet- Page 46 of 163 AMENDED AGENDA