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Sunday, November 02, 2008

Convenience Fees

Jeff Nolan's post reminded me of a fight I had with San Mateo County Property Tax a few years ago.

I paid my property tax via an e-check mechanism. I was astounded to see that they added a $5 "convenience fee". Here's the back and forth emails:

> >>> 10/22/2004 1:18:41 PM >>>
> I unfortunately paid my property tax through the e-check process. I
> did not realise that there was a rip-off $5 fee charged "to offset
> associated costs charged by the banking industry". What about the
> probably greater costs for you to process a paper check?
> Could you please refund my payment fully, as I intend to pay with a
> paper check postmarked on 10-Dec??
> Thanks,

And the reply:

> TaxMaster TaxMaster <TaxMaster@co.sanmateo.ca.us> wrote:
> Normally payments are only refunded if they are posted incorrectly,
> such
> as paying on an incorrect wrong parcel. The convenience fee is clearly
> posted in three separate fields prior to filling in the bank
> information
> for the transaction. The payment has already been posted to your first
> installment.
> Laura Williams
> County of San Mateo
> Tax Collector's Office
> 555 County Center, 1st Floor
> Redwood City, CA 94063
I replied with:

> >>> 10/22/2004 4:21:33 PM >>>
> Why isn't the cost of processing a paper check passed on to those who
> use that payment mechanism?
> Thanks,
To which I got:
> The costs of processing paper checks re re-cooped through the investment
> pool of the county general fund. In essence you, as a taxpayer, are
> paying for that process but it is not as apparant as the convenience fee
> for the e-checks. The e-check fee was assessed based on a cost analysis
> done with Union Bank. This is a fairly new process for us but if the
> volume of e-checks increases we will be able to lower that fee.

Thankfully, they saw sense the next year, and stopped charging the "convenience fee". And by the way, contrary to the first reply from the County, it was not clear that they were going to charge this fee.

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