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NYS Comptroller

THOMAS P. DiNAPOLI

Cost-Saving Ideas: Reviewing Your Revenue Collection Process

Improving your receipt collection system may get revenue into your municipality’s bank account more quickly.

Start by evaluating the costs and benefits of various revenue collection alternatives, using measures such as:

  • How long does it take to process a tax or fee payment?
  • How many total collections are being processed?
  • What is the cost per transaction?
  • How convenient is the process for residents?

By becoming more efficient, you can possibly increase collections, lower your processing costs and increasing interest earnings.


Use a Lock Box

By having a financial institution process payments on your behalf, you can reduce the amount staff time devoted to clerical duties.

  • Set up a contract with a bank or trust company to receive and process payments for your local government that are made by check or cash. (Payments can include real property taxes, special assessments and sewer and water user fees.)
  • Ensure that the service provider complies with statutory requirements, and that proper internal controls are in place.

Accept Credit Card Payments

Providing residents the option to pay for fees, fines, taxes or other charges by credit or debit card can enhance customer service and convenience. Typically, a service fee is charged for each transaction.

  • Determine whether you will absorb the service fee or pass it on to the cardholder. (The law limits to the costs incurred in connection with the credit card charge.)
  • Use a competitive process to establish your service provider. (The contract must still comply with state and local procurement policies and procedures).
  • Explore whether any of the bidders are willing to reduce or waive their standard fees.

Accept Online Payments

Accept payments by credit card or electronic funds withdrawal through your municipal website. This may result in increased collections of certain charges, such as payments of real property tax by those who live outside the area.

The online option:

  • comply with certain provisions of the State Technology Law and related regulations.
  • authenticate the identity of the sender and ensure the security of the information transmitted.
  • not be the sole method of payment.
  • provide a confirmation page, which includes the transaction date and a notice to the taxpayer to print out and retain the page as a receipt.

Enroll in the Electronic Value Transfer Program

Accept credit card or other electronic payments through State contract, as part of the Electronic Value Transfer Program (EVT). Payments may be made on-site, over the Internet and through an Interactive Voice Response System. Local governments and BOCES currently use EVT contracts for collecting taxes, tuition, recreation fees, parking passes, utility payments and Justice Court fees.


Resources

New York State Office of General Services:

Government Finance Officers Association Recommended Practices:

Updated 2016