POLICY 2
CREDIT CARD/MERCHANT CARD/PRE-PAID CARD

SECTION INDEX: Credit Card/Merchant Card/Pre-Paid Card

1 Purpose

2 Application

3 Guidance

3.1 Credit Cards

3.2 Use of Credit Cards

3.3 Merchant Cards

3.4 Pre-Paid Cards

3.5 Responsibility of Departments and Users

3.6 Disallowed and Improper Charges/Transactions

3.7 Rebates, Gifts, etc.

3.8 Amendments to the Procedures and Policies

4 Forms

4.1 Approval to Obtain City Credit Card Memorandum

4.2 Credit Card Acceptance Form/Receipt

1. PURPOSE

To establish procedures and policies that applies to the use of credit cards, merchant cards and pre-paid cards. These procedures and policies are for the use of cards to:

• Provide for rapid acquisition of small dollar purchases.

• Reduce the amount of paperwork required when making certain types of purchases.

• Facilitate efficiency of operations.

• Facilitate purchases where a card is required.

The term credit card as used in these procedures and policies shall apply to General purpose credit cards as defined in resolution M-1477. This term also applies to purchase, procurement, or travel cards.

Use of credit cards is authorized by the City of Olympia Travel Policy, and Resolution M-1477.

2. APPLICATION

The Policy applies to all City employees, City Councilmembers and Board, Commission and Committee members.

3. GUIDANCE

3.1. CREDIT CARDS

a. Obtaining Credit Cards

Only the Administrative Services Director or designee is authorized to order credit cards from providers of credit cards.

Requests for credit cards shall be made to the Administrative Services Director. Requests for credit cards shall be in writing and signed by the director of the department requesting the card(s), using the Approval to Obtain City Credit Card memorandum form.

Credit cards shall bear the name of the City of Olympia and the name of the person responsible (cardholder). Credit card accounts where there is no physical card (ghost cards) may be obtained by the Administrative Services Department for payment of invoices through the accounts payable process.

Any employee issued a credit card under these procedures and policies shall sign the Credit Card Acceptance Form/Receipt. The employee shall also agree in writing to allow the City to withhold and deduct amounts owed the City by the employee, including the authorization to deduct from the employee’s pay, amounts owed the City by the employee due to improper, disallowed or unauthorized charges, penalty and interest incurred thereon. Disallowed transactions include, but are not limited to transactions for which proper documentation is not provided. This section shall not apply to charges made by others who have unauthorized possession of the card or card number. Fraudulent use by an employee or anyone whom the employee allowed to use a credit card or card number may be cause for termination of employment for the employees involved in the fraudulent use.

The Administrative Services Director, or designee, may suspend or cancel any credit card due to: failure of a card holder or department to comply with these procedures and policies, misuse of a card, failure to provide or habitually late in providing documentation or completing required accounting information; failure to reimburse the City for disallowed charges; failure to maintain proper custody of the card; or other uses of a card which the Administrative Services Director deems not in the best interest of the City.

3.2. USE OF CREDIT CARDS

a. Credit cards may be used for:

• Expenses authorized by the travel, recognition events and other related expense, and miscellaneous expense policies. When credit cards are used for meal or other travel expenses which are not authorized by the travel policy or exceed reimbursement limits of the travel policy, such amount(s) shall be paid by the cardholder within 10 days of return from the travel or notification by the City of disallowed charges.

• Purchase of goods and services.

• On-line purchases when such purchase is advantageous to the overall efforts of the City. Purchasers of on-line services shall ensure that sales tax is paid or that the Administrative Services Accounting Section is notified that sales tax has not been paid, in which case the use tax will be paid and charged to the department.

• Payment of invoices through the accounts payable process of the Administrative Services Depatment.

Employees using credit cards shall ensure that purchases comply with all applicable laws, rules, regulations and purchasing policies.

b. Credit cards may not be used for:

• Cash advances.

• Personal purchases.

• Purchases for any non-official City of Olympia purpose.

• Food and refreshments not included in the travel, miscellaneous expense or recognition policy.

• Travel expenses for individuals not covered by the travel policy, even if it is the intent to reimburse the City.

• Purchase of alcohol.

• Purchases which are in violation of any law or regulation.

3.3. MERCHANT CARDS

Merchant cards shall be obtained only by the Accounting Section of the Administrative Services Department upon approval of the Administrative Services Director. The Accounting Section of the Administrative Services Department shall establish procedures for the use of merchant cards.

Merchant cards shall be issued in the name of the City.

Merchant cards may be used for purchases and payment of services only from the vendor issuing the merchant card.

The employee shall also agree in writing to allow the City to withhold and deduct amounts owed the employee by the City, including the authorization to deduct from the employee’s pay, amounts owed the City by the employee due to improper, disallowed or unauthorized charges, penalty and interest incurred thereon while the card was provided to the employee and not in the possession of the department custodian. Disallowed transactions include, but are not limited to transactions for which proper documentation is not provided. This section shall not apply to charges made by others who have unauthorized possession of the card.

3.4. PRE-PAID CARDS

Pre-paid cards are cards which have a monetary value and may be for purchases for specific items or general purchases. These cards include cards generally referred to as gift cards.

Pre-paid cards shall be obtained only by the Accounting Section of the Administrative Services Department or written authorization for departments to make specific purchases, upon approval of the Administrative Services Director, or designee. Written authorization for a department to purchase pre-paid cards shall not be general in nature, with individual authorization for each card purchased. The Accounting Section may establish administrative procedures for the use of pre-paid cards in addition to procedures which may be included in this policy.

Pre-paid cards are the equivalent of cash. All purchases using a pre-paid card must be accounted for with details for all purchases, showing at a minimum a description of the purchase and cost of each item, using forms as prescribed by the Accounting Section. Invoices or statements of purchases shall be provided for each purchase.

Employees obtaining or purchasing pre-paid cards shall agree in writing to allow the City to withhold and deduct amounts owed by the employee by the City, including the authorization to deduct from the employee’s pay any amount owed the City by the employee due to improper, disallowed, unauthorized or undocumented use of the pre-paid card. Employees who are liable for a card may surrender the card to the Accounting Section and obtain a dated receipt for the card. Disallowed transactions include, but are not limited to transactions for which proper documentation is not provided. Surrendered cards may be reissued to the same or another employee. Employees will not be liable while the card in is the possession of the Accounting Section.

3.5. RESPONSIBILITY OF DEPARTMENTS AND USERS OF CREDIT CARDS/MERCHANT CARDS/PRE-PAID CARDS

All transactions shall be documented by receipts or other documents in lieu of receipts, which provide details of the transaction and in a form acceptable to the Administrative Services Director. Any transaction not properly documented shall be deem disallowed and be subject to the rules applied to disallowed charges and/or transactions.

Department Directors shall be responsible for ensuring card usage by employees of their department and conform and to all applicable laws, rules, regulations and these procedures and policies. Directors shall establish responsibility, control and ensure appropriate records are maintained.

Department Directors (or designee) shall approve each card transaction.

The Department Directors or designee shall ensure timely submittal of required documentation by employees of their department.

3.6. DISALLOWED AND IMPROPER CHARGES/TRANSACTIONS

If improper charges/transactions are not repaid before the credit card billing is due and payable, the City shall have a prior lien against and a right to withhold any and all funds payable, or to become payable to the cardholder up to the amount of disallowed charges/transactions, penalty, and interest at the rate charged by the issuer of the credit card.

3.7. REBATES, GIFTS, ETC.

Rebates, gifts, awards and other gratuities received related to a City credit card or use thereof, shall be the property of the City of Olympia. Such items shall be used for the business needs of the City. Such benefits shall not accrue to benefit the cardholder.

3.8. AMENDMENTS TO THE PROCEDURES AND POLICIES

The Administrative Services Director may amend these procedures and policies as needed to insure the proper use and control of credit cards.

4. FORMS