Council adopts convenience-fee model to pass card-processing costs to customers

Kingman — Following a public hearing Tuesday, the City Council adopted a resolution allowing the city to implement a convenience-fee model for credit and debit card transactions so card-processing costs are charged to customers rather than absorbed by the city.

Finance staff told council that the city currently spends roughly $500,000 annually to process card payments across multiple departments, most heavily in utility billing. Card-processing fees and minimums vary by processor and platform; staff reported sample ranges from about 2.95% to 3.5% of a transaction, with some processors imposing a $2 minimum fee for small purchases.

Finance Manager Tina (last name not specified on the record) explained that the city uses several card processors because different payment platforms (utility IVR, online portals, parks registration, point-of-sale systems) require different integrations. She said staff will attempt to minimize customer disruption by posting notices at counters and on online platforms in advance of the October implementation target. A small number of city services that use processors without a convenience-fee option will continue operating under current terms until alternate processors or technical changes are in place.

Members of the public raised operational concerns. Mike Lipshtein asked about competitive bidding and whether staff had sought multiple processor proposals; staff explained that some platform integrations limit the choice of processor. Britney Gish, representing a business that uses nonlocal payment rules, said convenience fees can slow vendor payments because some businesses’ procurement rules prohibit suppliers from paying convenience fees.

Council voted to adopt the convenience-fee model; staff said they would phase implementation and return to council with any platform-specific contract changes needed to support the new model.