There will be an incentive for property owners to pay their utility bills using an automatic withdrawal from checking accounts. The Coon Rapids City Council approved a recommendation from Finance Director Sharon Legg to offer a one-time $3 discount to utility customers who sign up for automatic withdrawal from checking accounts.
The vote was 4-1 with Councilmember Denise Klint opposed. Councilmembers Melissa Larson and Paul Johnson were not at the meeting Nov. 20.
The discount won’t go to those who already pay their utility bills through automatic withdrawal from their checking accounts, according to Legg. That would be too expensive, Legg said.
The automatic withdrawal system is the most efficient and cost effective from of collection, she wrote in a report to the council.
“Utility billing customers can now pay their quarterly bill one of three ways – cash/check, credit card or with an automatic withdrawal from their checking account on the due date of the bill,” Legg wrote.
What makes the automatic withdrawal from a checking account very efficient to process is that it is essentially an upload into the utility billing system, according to Legg.
The city has offered this option for a number of years and would like to expand its use, Legg wrote in her report.
“Checks that are received in the mail require handling, including opening, balancing and date entering as well as bank charges,” she wrote.
“Credit cards, although efficient, are very costly. The credit card company charges between 1.5 to 2 percent of the amount paid.”
According to Legg, the city has paid about $10,000 in credit card fees in 2012 for utility billing customers.
Peter Bodley is at [email protected]