(A) Purpose. The purpose of this policy is to provide internal controls and accurate accounting procedures with regards to the use of credit cards, i.e. Gas America, Speedway, Master Card, Lowes, etc. while increasing purchasing flexibility. Also, to ensure the Municipality of New Lebanon bears no legal liability from inappropriate use of credit cards. The Municipality of New Lebanon may make available the use of credit cards to employees with purchasing responsibilities. Use of credit cards is considered a privilege and is not a right for any employee of the Municipality of New Lebanon. This privilege may be revoked for failure to adhere to any or all of the policy, guidelines and/or instructions set forth below.
(B) Policy.
(1) It is the policy of the Municipality of New Lebanon to utilize its established purchasing procedures via paper check and purchase order for normal purchases.
(2) However, there may be situations where the preferred method of payment is not the most effective. The Municipality of New Lebanon will allow the use of the municipal credit card for the following reasons:
(a) When traveling on official village business;
(b) When a check form of payment is not accepted;
(c) When a check form of payment is not conducive to operational efficiency; and
(d) When making online purchases for municipal business.
(3) The village credit card may NOT be used for the following reasons:
(a) Personal purchases of any kind;
(b) Personal cash advances through automated teller machines or through a bank teller;
(c) Alcoholic beverages;
(d) Any product or service that is not considered "official municipal business" or any use of municipal funds considered "inappropriate"; or
(e) Entertainment.
(C) Guidelines.
(1) This purchasing system provides for the policies and procedures for control of the municipality's expenditures. These controls include the review and approval of purchase requests by the Municipal Manager and/or Finance Director.
(2) Each credit card will have a predetermined spending limit.
(3) Each person and/or vehicle that is issued a credit card (the cardholder) will be responsible for maintaining spending under its spending limit, within the monthly billing cycle.
(4) The Municipality of New Lebanon is a tax-free government entity. Purchases should be obtained without tax, whenever possible. Tax exemption forms may be obtained through the Finance Department/CFO.
(D) Procedure.
(1) Credit cards will be issued from the Finance Department/CFO.
(2) When a credit card is needed to complete a purchase for municipal business, the purchaser shall notify the Finance Department/CFO to acquire and sign out the specific card. The Credit Card Log-In/Log Out Sheet must be completed when a credit card is signed out as well as signed back in. The card must be returned and signed in immediately following the use of the card.
(3) It is the card users responsibility to provide an itemized transaction receipt from the vendor each time a credit card is used. Original receipts will be matched to the credit card's monthly statement(s). Original receipts must be turned in at the time the card is returned. The following guidelines apply:
(a) Original receipts must be attached for all purchases of goods and services regardless of cost. This includes charges for meals and goods.
(b) Receipts must be itemized detailing each item purchased. If a tip was added to a meal purchase, the itemized and summary receipts must be submitted.
(c) Missing receipts—the card user must attempt to get the receipt from the vendor. If the receipt is not available, the card user must provide an explanation for the transaction in writing for each missing receipt.
(d) If a telephone order is to be placed, please request a statement or packing slip. This document will be turned in as your required "proof of purchase".
(4) Credit card numbers are not to be stored on any websites for online purchases, travel, etc.
(5) Credit cards cannot be used for IRS reportable payments for services (i.e., independent contractor services for which a 1099 must be issued for amounts totaling in excess of $600.)
(6) Credit cards may be used for vendors who are incorporated, governmental or tax exempt and online purchases of goods or travel.
(7) Card users must comply with all municipal expense and travel policies.
(8) For emergency situations, purchases will be processed as a Then and Now procurement.
(9) The Finance Director/CFO or Municipal Manager shall annually report to the Council all/any rewards received by the municipality for the use of the credit cards.
(E) Disputes and returns.
(1) If items purchased with the credit card are found defective or the repair or service is faulty, the card user will be the responsible party to return those items, receive reparation or receive the credit for the purchase. If the merchant refuses to replace or correct the faulty items, then the purchase is considered to be "in dispute".
(2) All disputed items must be annotated by the card user and brought to the attention of the Finance Department/CFO or Municipal Manager.
(3) The Finance Department/CFO must annotate all disputed items on the monthly account billing statement.
(F) Lost or stolen cards.
(1) Should a credit card be lost or stolen, it is the responsibility of the card user to immediately notify their Department Head and the Finance.
(2) Upon notification of a stolen card, the card user is required to immediately file a police report. A copy of this police report is to be turned in to the Finance Department/CFO.
(3) It is the responsibility of the card user to notify the Finance Department/CFO within one working day of a lost or stolen credit card. Failure to do so may be grounds for termination of card use and/or responsibility.
(4) Any suspicious use/activity of a credit card shall be reported immediately to the Finance Department/CFO once noticed. Failure to do so may be grounds for termination of card use and/or responsibility.
(G) Employee transfer and termination.
(1) Should a cardholding employee discontinue employment with the Municipality of New Lebanon, they will be responsible for returning their credit card to the Finance Department/CFO, prior to any last pay and/or benefits being issued. The Finance Department/CFO shall review receipts and reconcile the credit card before the employee's last day of employment with the municipality.
(2) In the event an employee with access to credit card usage terminates without returning the credit card, the Finance Director/CFO will immediately terminate card benefits with the financial institution. The Finance Director/CFO shall document such action on a memo. The original, signed memo will go to the Municipal Manager for record. A copy shall be placed in the employee's personnel file. The employee shall no longer have access to the credit card on file with any business.
(H) Requests for credit cards or changes to existing cards.
(1) All requests for credit cardholders will be on an official memo and go to the Municipal Manager.
(2) Any changes to existing credit cards will only be approved by the Municipal Manager.
(I) Store credit cards.
(1) Store issued credit cards will follow the same procedures as bank credit cards as listed above in divisions (A) through (H).
(2) Store accounts that do not utilize physical cards (i.e. Lowe's) require a department head’s approval for an employee to be listed as an authorized purchaser. Employees must contact the Finance Department/CFO to obtain a purchase order before the purchase is made. Reconciliation will be performed between the receipts, purchase orders, and store statements each month.
(J) Annual inventory of credit cards. The Director of Finance and/or the Municipal Manager may conduct an annual, physical inventory of all credit cards. The date shall be at their discretion.
(K) Employee misuse. Any employee who knowingly misuses a municipal credit card for purposes not authorized would be in violation of this policy as well as R.C. § 2913.21. The employee will be subject to disciplinary action up to and including termination as well as any actions directed by R.C. § 2913.21. Employees are personally liable for unauthorized charges and any associated fees. If, through no fault of the employee, the credit card is illegally accessed and used by a third party, the employee will not be personally liable for changes and fees directly resulting from the illegal access.
(Res. 2019-39, passed 12-17-19)