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Home My WebLink About2011 09 12 Consent 206 Resolution 2011-45 Bank Drafts COMMISSION AGENDA CONSENT X INFORMATIONAL ITEM 206 PUBLIC HEARING REGULAR MGR /DEPT September 12, 2011 Regular Meeting Authorization REQUEST: Finance and Administrative Services requests that the City Commission adopt Resolution No. 2011-45 amending the City’s Bank Draft Policy. SYNOPSIS: The purpose of this Resolution is to amend the present bank draft policy (Resolution 2004-36) in order to provide a more customer-focused collection process which is consistent with the City’s preferred payment method as well as Ordinance 2011-11. CONSIDERATIONS: On May 9, 2011, Regular #600 brought forward a number of potential revisions for Commission consideration (attached). The Commission voted on each topic and directed staff to work with City Attorney to bring back any and all necessary documents to effect the revisions. One such revision was a relaxing of the revocation criteria related to bank drafting. Revocation of Bank Draft Privileges : Presently, the first time a bank draft payment is returned for reason of insufficient funds, the bank draft privilege is suspended. Upon the second occurrence the privilege is permanently revoked. This policy recommends that bank draft privileges not be revoked until the customer’s insufficient funds’ history becomes ‘chronic’ as defined in Ordinance 2011-11. This proposed revision is primarily a convenience issue for the customer. While it is possible that some customers may fall back into NSF status, the prevailing fees would serve as the appropriate consequence/disincentive. Bear in mind that each returned payment results in a $20 NSF fee. Should the customer neglect to pay the balance due, services are eventually disconnected. Consequently, a customer with three returned bank drafts in a twelve month period has paid $60 in NSF fees as well as any other fees which would be incurred if the NSF also resulted in disconnection. Improved Process : One of the issues with our current process of bank drafting is the long time delay (1-2 billing cycles) between receipt of the bank draft authorization form and the actual onset of the initial bank draft. Previously, the bank verification process known as pre-noting did not occur until Special Payment Arrangements September 12, 2011 Commission Consent Item 206 Page 2 of 2 generation of the customer’s next utility bill. Consequently, depending on the timing of a bank draft request and the timing of the bill cycle, the first opportunity to ‘pre-note’ could be as far as 31 days out. The recommendation is that the revised pre-note process be initiated on a weekly basis independently of the bill run. The result will significantly reduce the delay of implementation as well as the number of manual steps in the bank draft process. The amended bank draft policy is incorporated in Resolution 2011-45 as set forth by legal counsel. FISCAL IMPACT: No additional funding is necessary to implement the Bank Draft Policy. COMMUNICATION EFFORTS: This Agenda Item Has Been Electronically Forwarded To The Mayor And City Commission, City Manager, And Is Available On The City’s Website, LaserFiche, And The City’s Server. Additionally, Portions Of This Agenda Item Are Typed Verbatim On The Respective Meeting Agenda Which Has Also Been Electronically Forwarded To The Individuals Noted Above, And Which Is Also Available On The City’s Website, LaserFiche, And The City’s Server; Has Been Sent To Applicable City Staff, eAlert/eCitizen Recipients, Media/Press Representatives Who Have Requested Agendas/Agenda Item Information, Homeowner’s Associations/Representatives On File With The City, And All Individuals Who Have Requested Such Information. This Information Has Also Been Posted Outside City Hall, Posted Inside City Hall With Additional Copies Available For The General Public, And Posted At Five (5) Different Locations Around The City. Furthermore, This Information Is Also Available To Any Individual Requestors. City Staff Is Always Willing To Discuss This Agenda Item Or Any Agenda Item With Any Interested Individuals. All communications will be updated to reflect the new bank draft policy – i.e. bank draft authorization form, website, welcome bag materials, etc. RECOMMENDATION: Staff recommends approval of Resolution 2011-45 amending the Bank Draft Policy. ATTACHMENTS: Resolution 2011-45 RESOLUTION NO. 2011-45 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, FLORIDA, BANK DRAFT POLICY FOR UTILITY CUSTOMERS; PROVIDING FOR THE REPEAL OF PRIOR INCONSISTENT RESOLUTIONS; PROVIDING FOR SEVERABILITY; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, on August 23, 2004, the City Commission adopted Resolution 2004-36, provide an additional form of utility bill payment; and WHEREAS , the City Commission recently amended certain utility billing procedures through the adoption of Ordinance 2011-11 and desires to consistent with the provisions of Ordinance 2011-11 as set forth herein; and WHEREAS , the City Commission of the City of Winter Springs deems that this Resolution is in the best interests of the public health, safety, and welfare of the citizens of Winter Springs. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF WINTER SPRINGS, SEMINOLE COUNTY, FLORIDA, AS FOLLOWS: Section 1. Incorporation of Recitals. The foregoing recitals are deemed true and correct and are hereby fully incorporated by this reference. Section 2. Revision to Bank Draft Policy. The City Commission of the City of Winter -36, as follows (underlined type shall indicate additions to, and strikethrough type shall indicate deletions from, the Bank Draft Policy): 2.1 The use of bank draft to pay a utility account is encouraged by the City of Winter sign an appropriate authorization form before bank draft commences. 2.2 Every customer should have the opportunity to participate, except for those customers who are required to pay for utility services by cash or money order. An account must be in good standing with no previous returned checks and shall not have a chronic payment history in order to be eligible for automatic bank draft privileges. A chronic payment history is defined as four (4) or more returned payments in any 12-month period. 2.3 Any account deemed not ineligible for bank draft will be notified by the City . 2.4 Bank draft will be for the entire monthly balance due and any outstanding charges. Partial bank drafts will not be accepted. City of Winter Springs Resolution No. 2011-45 Page 1 of 3 2.5 (14) days after the bill date on the utility statement. The bank draft shall become due 2.6 Billing disputes must be received in writing by the City no later than eleven (11) days following the bill date on the utility statement to prevent the bank draft from being processed. All bill payments during the time period of the dispute must be paid by means other than the automatic bank draft. Customers shall be required to provide a detailed explanation for the dispute. Notification of a billing dispute received after the deadline could result in the bank draft being processed for that bill. 2.7 Bank draft will continue until cancellation notice is received from the customer. Bank draft cancellation must be received in writing by the City no later than eleven (11) days following the bill date on the utility statement to prevent the bank draft from being processed. 2.8 A customer shall not temporarily suspend a bank draft. Any written request received by the City to suspend a bank draft for one month will be deemed a cancellation bank account. 2.9 Any bank draft returned for insufficient funds will result in NSF fees the customer. Customers having chronic payment history may lose bank draft privileges consistent with section 19-97 of the City Code. Further, an interruption in utility service could occur, in which case, disconnection, authorized by the City Code. Two insufficient fund notifications will result in permanent cancellation of bank draft privileges as well as payment of future utility statements to be in the form of cash or a money order. 2.10 At the direction of the City, bank draft privileges may be reinstated six (6) months after cancellation or suspension of bank draft privileges as discussed in Sections 2.7 and 2.8 of this Resolution. 2.102.11 If an existing bank draft customer desires to change banking institutions, the bank change must be received by the City in writing, no later than eleven (11) fourteen (14) days after the bill date to avoid a bank draft on the account on file with the City any insufficient fund fees being assessed to the customer. In the event of extraordinary circumstances including, but not limited to, fraud and closing of a bank, exceptions to this rule may be made by the City. However, if eleven (11) fourteen (14) days notice is not provided, the City can not cannot 2.112.12 All past due billings must be paid in full before a customer enrolls in the bank draft program. City of Winter Springs Resolution No. 2011-45 Page 2 of 3 2.122.13 All customers participating in the bank draft program must permit the City to conduct pre- Section 3. Restatement of Bank Draft Policy. licy shall be Authorization Form. Section 4. Repeal of Prior Inconsistent Resolutions. All prior resolutions or parts of resolutions in conflict herewith are hereby repealed to the extent of the conflict. Section 5. Severability. If any section, subsection, sentence, clause, phrase, word, or portion of this Resolution is for any reason held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and such holding shall not affect the validity of the remaining portion hereto. Section 6. Effective Date. This Resolution shall become effective immediately upon adoption by the City Commission of the City of Winter Springs, Florida. RESOLVED by the City Commission of the City of Winter Springs, Florida, in a regular meeting assembled on the _____ day of ___________, 2011. __________________________________ CHARLES LACEY, Mayor ATTEST: ________________________________________ ANDREA LORENZO-LUACES, City Clerk Approved as to legal form and sufficiency for the City of Winter Springs only: _______________________________________ ANTHONY A. GARGANESE, City Attorney City of Winter Springs Resolution No. 2011-45 Page 3 of 3 RESOLUTION 10. 201 t-45 A RESOL�TIO� OF THE C1TY COilZNIISSION OF THE CITY OF ��%I?�TER SPRI�GS, FLORIDA, AIYIENDING THE C1TY'S BA\K DRAFT POLICY FOR LTILITY CtiSTOMERS; PROVIDI\G FOR THE REPEAL OF PRI�R I\CO\SISTE\T RESOLIITI4NS; PROVIDING FOR SEVERABILIT�'; A:\D PROVIDING FOR AN EFFECTIVE DATE. ��'HEREAS, on Au�;ust ?3, ?004, the City Comrnission adopted Resolutioii 2004-36, establish�i�n� a Banlc Dra�'t Policy for the City's ut�ility customers to provide an additional form of utility bill payment; ai�d WHEREAS, the City Cominission recently amended certain utility billing procedures throu�h the� adoption of Ordinance 2011-11 and desires to revise r�he Citv's Bank Draft Policy consistent ��ith the provisions of Ordinance 2011-11 as set forth herein; and Vb'HEREAS, tlle Cit_y Cam�llission of the Cit uf Winter Sprin�s deems that t11is Resolution is in the best interests of khe public liealtll, safety, and welfare of the ciCizens of Winter Springs. �O�V, THEREFORE, BE 1T RESOLVED Bl' THE C1TY CONIMISSION OF THE CITI' OF `'��I:�TER SPRI:�GS, SEMINOLE COLTtiT1', FLORID�, AS FOLL4�VS: Section 1. incorporation of Recitals. The foregoing recitals are deemed tri�e a1�d correct and �re liereby fully incorporated by t11is reference. Se�ct�ion 2. Revision to Bank Draft Policv. The City C�mi�nission of the City of VViliter S�rings 1lereby amends the City's Bank Draft Policy, as est�blished by Resolutio►l 200�-36, as follows (underlined type shall indicate additions to, and �*r;'.^+' type shall indicate deletions from, the Banl� Draft PolictiJ): 2.1 The use of bank draft to pay a utility account is encouraged by the City of Winter Sprinbs. Any utilit_y custo�l�er ("c�ustomer") who desires to use banl<� draft sliall be required to sign an appropriate authorization fon�n be�fore banl: draft coinn�lences. 2.2 Every eustomer slloulcl I�ave thz vpportunity to �articipate �� ~� '��Y +',,,~_, . . An account must be in good standing �•��*'� �� r�. ,.��„�.��' ��'�� and sha11 not IZave a chronic pavment histor�� in order to be eligible for aut�on��atic bank draft �rivileges. A chronie pavment histor ��is defined as four (�) or inore returned pay�ments in anv 12-inont(� t�eriod. 2.3 Any accot�nt deen�led � ii�ieligible for bank draft will be noti�ed by the C'itv r;,<.>� o.,<,,,�„� n��;,,,,,- 2.4 B1nk drlfit ��ill t�e fior the entire month]y balance due 1nd any ��itstancling char�es. Partial banl< drafts will not be aceepted. City c�f �'��inter 5}�rin�s Resolution \o. ?01 I-45 Pasc 1 ot'3 2..5 Funds will not be debited from a custoi�ier's banl: accot�iit for at least fourteen (14) days after the bill date on the utility statement. TI1e bank draft shall become due immediately upon the City's submission to the City's banking institution. 2.6 Billing disputes Ynust be received in �vriting by the City no later than eleven (11) days fol�owing tl�e bill date on the �utility statement to prevent tlie ba�ik draft �con� being processed. All bill }�ayments durin�; the time period of the ciispute roust be paid t�y mea�is ather than tlie automatic banl: draft. Custoiners shall be required to provide a detail�d eaplanation for the dispute. Notificatio�n of a billing dispuxe received aft�er the deadline cot�ld result in the bai�lc draft being processed for that bill. 2.7 Banlc d:raft will continue until cancellation notice is received from the customer. Banl< draft cancellation intast be received in ��-rit�ing b_y the CitY no later than eleven (11) days follo��ii�lg the bill date on the utilit_y sta.tenient to preti�ent the banlc draft from being processed. 2.8 t� customer shal( not temporarily suspend a bank draft. Any written request received by the City to suspei�id a�bai��k draft for one month �vill be deen�ed a cancellat�ion reqtiest, unless said suspension is r�quired to change banks or preve�nt fraud on the customer's bank accoi�nt. 2.9 Anv banlc draft reh�rned for insufficient fiinds «Till result in NSF fees t�e � �, . � � b � . Cl�st�onlers l�avins� cllronic pavment 1listor �� lose bai�k draft pi-ivileges consistent witl� section 19-97 of the Cixy Code. Further, au interruption in utility ser��ice could occur ii1 �c�hicll case disconnection. reconneetion and any other a�plicable fe�e inay be assessed to the ci�stoiner's account. as atlthorized by t11e Cit�� Code. � - � ;� :� - .� +,...,.., ,�� ,,,,��, „ ..,a,,.. - . .. � � }t,�,. n�,.,.i,,.;,,., .. 2.10?-�-� If an existii�g banl: draft ct�stoi�ne,r desires to cl�iai�ige banicil�ig institutions, the b1�ik cltange must be recei��ed by tlle Cit_y in writiil�, �lo later tlia�� eleven (11� #��e�e�-E�3 days after the bill date ta a��oid a bank draft on tlae account on tiLe wixh the Citv . �,.,�' ��n "�;� � n�a *� *',� �.�-*�,,�� In the eveut of extraordinary circumstances inclt�ding, but not limited to, fraud and closing of a bank, except�ions t�o t�his tlzle n�ay be made by the C'ity. Ho4vever, if eleve�.i (11� ''^��.�� da_ys rlatice is not provided, the City �� cannot guarantee the cancellation and/or modification ofi the customer's banl: draft. 2.11� All past due billings �i�i�nist be paid in fiall before a customer enrolls in t�he l�ank draft }�rogrl�l�. Citv ol'��Vint�er Sprin�s Resi�ltilion \o. ?Ol I-45 Yase ? iif 3 2.123� All customers part�icipa.tin�; in the bank draft program nnist penilit t�he C'iky to conduct pre-draft testing ��itli the customer's banl:, as the City deems necessary. Section 3. Restatement of Bank Draft Policy. The Citv's Bank Draft Policy shall be restated in fiill, as amended by this Resolution, on tlie reverse sicle of the CitS�'s Banlc Draft Ai�thorization Forni. Section 4. Repeal of Prior Inconsistent Resolutions. All ��rior resolutiolls or parts of resoltztions in conflict here.witl�i are hereby repealed to the extent of t�he conflict. Section 5. Severability. If any sectioll, subsection sentence, clause, phrase, word, or portion of this Resolution is fior any reason he(d in�-alid or unconstitutional by any court of competent _jurisdictioti, such portion sliall be deemed a separate, distinct and independent provision and si��ch holding shall not affect the validi�ty of t�l�ie remain�i�n� portion l�iereto. Sec�tion 6. Effective Date. This Resol�utian s1iaJ1 become etfecti��e iininediately upoz� adoption by� the City Comz��ission of the C'ity of VViilter Sprin�s, Florida. RESOLVED by t�he City Comn�ission of the Gity of Wi�i��ter Spri�igs, Florida, i�n a regular meetin� asseinbled an the 12th �{ay �t September ; 20l l. � r � C ES LA : Y, a�>�ur r �� ATTEST � � � 1 AN �1�IZ0-LLiACE5, Cit�� Clerk Ai�proved to legal forrn and sufficienc�� for the C' � 'inter Springs only: ANTHONY A. GARGANESE, City Attorney City ul��%inter tiprin;,�s IZe�i>lutiuu \o. ?01 1-45 Pa<7c i uf >