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City takes plastic

April 28, 2005|by GREGORY T. SIMMONS

gregs@herald-mail.com

HAGERSTOWN - Brandy Carr didn't even think about it.

Carr, 30, walked into City Hall. Late on her electric bill, she pulled out her credit card.

The Hagerstown resident said she uses the card "probably most of the time" to pay "for everything. Whether it's just to get gas, go out to eat or just buying groceries."

Had Carr tried to pay with the card in March, she might have had more difficulty.

While many institutions and industries have been taking electronic payments for years, the City of Hagerstown just last month switched to a new electronic bill payment system that takes credit and check card payments.

The city still does not take debit card payments, but plans to soon take payments for most transactions over the Internet.

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Before March 21, anyone paying a city bill - electric, water, sewer, parking tickets and any number of things - had to pay with a paper check, cash or money order.

"We're catching up with the rest ... of the merchant community," City Finance Director Alfred Martin said Wednesday.

One reason the city had not been taking such payments until now was its previous billing system, which Martin said was about 20 years old. It wasn't easily upgraded to allow for credit and check card payments.

Martin said the changeover was in response to city customers who have been asking for the new system.

"It's just the cost of doing business," Martin said.

The system cost the city about $69,000 counting software, equipment and labor to install. It's not clear if the system will save the city any money.

For instance, the city might gain some savings by paying fewer processing fees for checks, Martin said. There are about 1,500 daily transactions with the city, and "it can add up."

But there will be a cost of about 1.5 percent to 2.5 percent on each credit and check card transaction, Martin said.

Heather Cook, a city bookkeeper who helps manage the cashiering system, said not too many people are aware that the city takes plastic payments.

Tina Hose, also a city bookkeeper, had several stacks of rubber-banded checks in front of her, and she was sifting through them Wednesday afternoon, looking for about 150 specific checks.

Under the new billing system, most of the checks taken by the city no longer have to be physically deposited. Some, however, still have to be processed the old way, and others that didn't clear the bank have to be rooted out of the stacks.

"I've probably been doing it an hour and a half," Hose said of the sorting. "It's a little monotonous."

Labor-intensive sorting procedures might be eased by another planned change in the system, opening up more time to pay attention to other administrative tasks and customer concerns.

Ron Cohoon, 33, of Hagerstown, dropped in to City Hall to pay his electric bill Wednesday and paid with a check, like he said he always does.

Cohoon said he didn't know that the city now takes plastic, but "I think it's is a good idea" in case he runs out of checks at an inopportune time.

Cook said one thing people should be careful of with the new system is that paper check payments clear faster. The old system used to take three to four days to process, but now the checks clear the midnight after the city receives the check.

"If your money's not in there today, then you can have problems," Cook said.

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