Credit card companies charge the merchant, in this case the County, a percentage of the transaction (between 1.8% and 2.35%). Internet Transactions are charged a higher percentage by the credit card companies due to the high incidence of fraud they experience on Internet transactions. Although merchants do not appear to pass on the credit card fee to customers, they can do so through adjusting the cost of their product. Also, they can increase their sales by accepting credit cards. While it appears some agencies (such as the DMV and SMUD) are not charging individual customers a "convenience fee" for credit card transactions, the cost is included in the rates. In these situations, the convenience fees are included in the costs the rate is calculated on, so non-credit card payers are absorbing that cost in the rate.
Many County customers want the option of being able to pay with their credit cards, so CUBS has followed the lead of the Franchise Tax Board, the Internal Revenue Service and the Sacramento County Tax Collector's Office and selected a third party vendor, Official Payments Corporation, to accept credit card payments on our behalf, and pay for all the associated costs (vendor costs and merchant fees) through the convenience fee. Depending on the type of product or service an amount of the credit card charge, the amount of the convenience fee is $4.95 for payments up to $500.00. The convenience fee is a separate charge that goes to the vendor and is not revenue to the County of Sacramento. The election to pay by credit card is a payment option for the convenience of customers who wish to use that method.
Previously, CUBS accepted both VISA and MasterCard; however, due to the large volume of credit card payments received, the cost of merchant fees (in excess of $100,000.00) and staff time required to process the transactions became too costly to absorb. By utilizing the existing County contract with the third party vendor, only those customers who elect to use the option to pay by credit card pay the convenience fee. Additionally, the third party vendor is able to offer a secure system with more options for payment (American Express Card, Discover Card, MasterCard and Master Money debit cards, or Visa Check Card as well as e-checks.)
Should there be an opportunity in the future to reduce convenience fees to customers at no cost to the County general fund, we will review the process for possible changes.
The vendor, Official Payments Corporation, may be reached at 1-800-487-4567 or 1-888-357-8394 and their website is