Michigan City Plans to Drop Credit Processing Fees for Parking Tickets

City officials in Grand Rapids, Michigan are planning to drop processing fees for online credit card payments when paying parking tickets and certain bills, MLive reports.

As part of an effort to make its website more user-friendly and transparenr, the city said it will be switching from JP Morgan Chase to PayIt LLC for the processing of online bill payments.

PayIt allows users to make payments either online or from their smartphones. The new service also makes it easy for residents to make payments by consolidating all bills into one simple payment system.

City documents reveal that the City Commission has agreed to spend a maximum of $825,000 as part of a one-year contract with PayIt, which also provides retailer credit card processing.

The new system will be a convenience for residents, but the transition won't save the city any money. John Globensky, Treasurer, said the city will spend about $375,000 more with PayIt than it would if it had stayed with JP Morgan Chase.

Under the current system, residents aren’t charged a credit processing fee for paying their water bill online. But when paying parking tickets, sidewalk repairs, trash bills, code violations and fire department services, processing fees range from $1 for bills under $40 to $122 for bills between $40 and under $5,000.

Last year, residents paid a total of $16.7 million in public services, including trash, water and parking tickets.

PayIt will eliminate credit processing fees for public service bills like parking tickets and trash. The city has chosen to pay the processing fees itself in order to promote the use of the new system. Globensky is expecting a 20% increase in online bill payments this year.

Grand Rapids is adopting the new system as part of an effort to move more of its services online. In 2016, the city processed 265,000 checks and 70,000 customers paid their bills in person. The city's goal is to reduce this number by 20%.

While customers won't be charged for most public service bills and parking tickets, the city will continue to charge transaction fees for online income tax and property tax payments. Residents who pay income and property taxes using direct bank transfers will not be charged a fee.

The city will be launching a new app in conjunction with its transition to PayIt. The app makes it easy for residents to pay all of their bills from one central location.

"We want to make it so that you can do business with the city at any time, anywhere and on any device," says Globensky.

Residents only need an email address and a password to log into the app. A customer's credit card and bank information will be linked directly to their account.

The app will also send the customer notifications to alert them about due dates and new bills.

"Our parking tickets double after 10 days. If I've provided a notification for you on day nine or 10 that says your ticket is due and you can easily click 'pay it' and click on your credit card or bank account and get that paid, you've just avoided that $20 steep in penalty," explains Globensky.