The seven-member board chaired by Mayor Steve Tumlin made the change Monday in a 7-0 vote. The City Council must adopt the change at its Wednesday Council meeting for it to become official.
If adopted, the change for commercial customers would take effect Oct. 1 and the charge for residential customers would be assessed beginning Jan. 1.
“The banks who process those payments for us charge us a transaction fee, so the customer pays them, and then they charge us a percentage transaction fee,” said Bob Lewis, general manager of the city-owned utility. “So what has happened is over time, and this is particularly true with large commercial accounts because when they pay a bill of $150,000 a month, and the bank charges 2 percent on that, you know, that’s a lot of money, so we have to eat that cost.”
Lewis said credit card transaction fees have risen for the city’s utility from $300,000 to $700,000 over the past four years.
Tumlin said that recently enacted credit card regulations didn’t help keep the city’s costs down.
“The federal government, when they put the clamps down on credit card companies, they didn’t clamp both sides,” Tumlin said.
Customers can still have their monthly utility bill automatically withdrawn from their bank account at no charge, Lewis said.
Lewis says he pays the same $250 utility bill, which is taken from his bank account each month.
“They take that out the same day of the month, and so there’s never any question,” he said. “It’s cheap, it’s easy and it doesn’t create these kinds of problems.”