For those who use their debit or credit cards to pay for city services such as water, trash, business licenses, medical transport and a host of other transactions, expect a service fee to be tacked on to your bills starting next year.
Peoria City Council on Oct. 17 approved a measure to impose a service fee of 2.80% per transaction — a $1.95 minimum — on all card payments.
Not all payments will be immediately impacted, but the goal is for all card payments across the city to be subject to the same service fee.
The fee will be effective Jan. 1, 2024, and will also impact utility and business license customers.
Officials say that for years Peoria has accepted credit card payments for services and the city has always absorbed the associated fees levied by the card network, the payment processor, and the online payment solution vendor. Over the last five years, these fees have cost the city a total of about $3.8 million, or $764,607 per year on average, according to a city document.
Deputy Finance Director Peter Christensen said these fees have been increasing steadily over the years with the city incurring those costs, and more cities are expected to pass the costs to their customers in the coming years.
“These fees keep going up as more people choose to use credit cards and as the amount of the payments increase. We think this is a large cost for the city to incur and more importantly for its rate payers to incur.”
The burden of paying credit card transaction fees will be shifted from the taxpayers to those customers who choose to use cards to pay for city services.
Residents will be educated on the changes via utility bills, the city website, the city’s payment portal and social media.
Christensen said the practice of shifting card fees to the cardholders is legal, subject to certain rules and limitations, and is becoming increasingly common among Valley cities. Peoria already charges a fee for those using credit and debit cards to pay for development permits.
Customers who wish to avoid this new fee and still pay for these certain city services electronically can do so through ACH electronic funds transfers. ACH electronic funds transfers offer a no-cost method to pay a city utility bill, business license, or other city services on a one-time or recurring basis.
“There will still be a no-cost alternative for making payments electronically to the city. That’s an option customers have today all across the city. We call them ACH payments. You may know them by EFT payments, or e-check payments. We are all familiar with these when we give our routing number on a checking account and they transfer money to a business account,” he said. “The fees to the city for those types of payments are much less than credit cards, so we choose to continue to absorb those so that our customers have a no-cost option to electronically transact business with the city.”
Customers paying for miscellaneous accounts receivable or for services provided by Parks and Recreation, Neighborhood and Human Services, Police, Fire-Medical, and other departments will not be impacted until those areas transition to Invoice Cloud, the online payment solution vendor, at a future date.
Philip Haldiman can be reached at phaldiman@iniusa.org, or on Twitter @philiphaldiman. We’d like to invite our readers to submit their civil comments, pro or con, on this issue. Email AZOpinions@iniusa.org.
Meet Philip Haldiman is an award-winning journalist who most recently took first place for investigative reporting in 2023 from Arizona Newspapers Association. He joined Independent Newsmedia, Inc., USA, in 2015, covering Sun City West his first year. Since 2016, he has covered the city of Peoria. Prior to coming to INI, he was a reporter with The Arizona Republic for seven years, covering numerous cities throughout the Valley. Before that, he was a freelance writer.
Community: Haldiman spearheads the Peoria Independent Hometown Heroes Awards program, honoring local individuals and businesses that give back to the community. He has hosted local candidate forums over the years and is a member of the Society of Professional Journalists. Haldiman also served as a member of the Journalism Program Community Advisory Board at Glendale Community College. Outside journalism, Haldiman served as a member of the city of Peoria Complete Count Committee for the Census, 2019-2020. Lastly, he has served as a member of his HOA governing board since 2021.
Education: Arizona State University with a BA in Journalism and Mass Communications and a BA in Theater.
Random Fact: Haldiman is a fourth-generation Arizonan as well as wrote and produced an autobiographical comic book about his time spent in Hollywood and his life as a cult film star.
Hobbies: He enjoys hiking Arizona’s mountainous landscapes and is currently working on a play for the stage.
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