POLICY 2
CREDIT CARD/MERCHANT CARD/PRE-PAID CARD Revised 12/25

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 Finance Director or designee is authorized to order credit cards from providers of credit cards.

Requests for credit cards shall be made to the Finance 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).

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 Finance 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 Finance 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.

• Online purchases when such purchases are advantageous to the overall efforts of the City. Purchasers of online 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 Finance Department.

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.

• Gift cards, other than pre-paid cards obtained with prior authorization. See 3.3 Pre-paid Cards.

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

3.3. 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 Payroll Section of the Finance Department upon approval of the Finance Director, or designee. The Accounts Payable and Payroll Section may establish administrative procedures for the use of pre-paid cards in addition to procedures which may be included in this policy. The Accounts Payable and Payroll Section shall facilitate the purchase of pre-paid cards using the requesting employee’s City credit card.

Pre-paid cards are the equivalent of cash. All purchases using a pre-paid card must be accounted for by the purchasing employee with details for all purchases, showing at a minimum a description of the purchase and cost of each item by attaching the additional information to the original purchase transaction in the accounting system. Invoices or statements of purchases shall be provided for each purchase. If the gift card is disbursed in the course of City business, the employee must attach support in the system with a description of recipients and reasons disbursed.

Employees obtaining pre-paid cards will pay back to the City any amounts used or disbursed that are improper, disallowed, unauthorized or undocumented, in accordance with the city credit card usage policy. Employees who are liable for a card may surrender the card to the Accounts Payable 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 is in the possession of the Accounts Payable Section.

3.4. 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 Finance 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 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.

3.5. 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.

3.6. 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.

3.7. AMENDMENTS TO THE PROCEDURES AND POLICIES

The Finance Director may amend these procedures and policies as needed to ensure proper use and control of credit cards.

4. FORMS