Explanation
BACKGROUND:
The city takes in thousands of checks each month for tax payments, water payments, utility fees, recreation fees, parking tickets and more. Unfortunately, at times checks are dishonored by the bank upon which it is drawn and returned to the City Treasurer due to insufficient funds (NSF). It takes up many personnel hours to write letters and track payments. Expenses associated with the city's efforts to recover the money due from citizens is costly.
Currently the city applies a return check fee of $15 for processing checks returned by the bank to the City Treasurer due to insufficient funds or a closed account. The Southern District of the United States District Court charges a "Return Check Fee" of $45. The State of Ohio allows a processing fee up to $30 or 10% of face amount of the check, plus reimbursement of bank fees. The City Treasurer recommends increasing the city's return check fee to $25 to help offset the cost to recoup monies owed to the City for services or programs.
It is a priority of the City Treasurer to recover all NSF checks so that the city can continue to provide valuable programs and services to the community.
FISCAL IMPACT:
Passage of this legislation might result in a slight increase in general fund revenues, more importantly; help cover some of the costs associated with collections.
Title
To authorize the City Treasurer to increase the fee for processing checks returned by banks as unpaid due to insufficient funds and various other reasons. To amend sections 1105.09 (Special charges) and 1163.19 (Service charge) of the Columbus City Codes, 1959 relating to a returned check processing charge and dishonored check charge.
Body
WHEREAS, the City Treasurer is the custodian of all public money received by the City; and
WHEREAS, checks offered for payment of city services or programs are at times returned unpaid by the bank which it is drawn upon due to insufficient funds or other rea...
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