(a) Purpose. The purpose of this policy it to ensure that City issued credit cards and/or purchase cards are closely monitored to provide for maximum security and to guard against misuse and/or losses for which the City may be held liable. This policy is meant to comply with Ohio Revised Code 717.31 and with the mandates of Sub HB 312 enacted by the 132nd General Assembly. City use includes cases where a purchase order is not accepted for needed services, supplies and/or materials, or are purchased from a vendor who issues a purchase card to be used in conjunction with a purchase order. The City-issued cards are NOT for personal use, and will not be permitted to be carried by personnel on a regular basis for any reason. All City credit cards shall be in the name of the “City of Trotwood, Ohio” and the department for which the card is authorized. In special circumstances, a credit card may also include a specific cardholder’s name.
(b) General Guidelines.
(1) The cards are to be kept in the control of the Finance Director. The Finance Director or designee will secure the cards in a safe, or in a locked cash box in a secure drawer.
(2) Each Director/Department Head must keep a master list of all employees who are permitted to use City credit cards, along with each employee’s title within their department. The list must be provided to the Finance Department annually, or whenever changes are made. A copy of a master list must be on file in the Finance Department and in the Human Resources Office.
(3) A log of the card name and number showing date, sign out time, sign in time, signature of person using the card, and valid purchase order number is to be kept by the Finance Department. The authorized user must initial each appropriate entry on the log indicating their acknowledgement of the card’s use and the purchase. Anyone needing to use a card must go to the Finance Department and sign the card in/out on this log.
(4) Regular purchase order policy and procedures must be followed whenever an authorized individual anticipates using the card. Every purchase using any card must have a valid purchase order assigned to it before the purchase is valid. The purchase order must contain the vendor (unless a multi-vendor purchase order) and provide descriptions, account numbers and estimated dollar amounts. No purchase shall exceed a spending limit of one thousand dollars and no cents ($1,000.00) without the express written consent of the appropriate Department Head or designee. This will ensure that sufficient appropriations exist to cover the anticipated charges. Once a purchase is made, simply return a copy of the P.O. along with the receipts you have accumulated, directly to the Finance Department, to complete the transaction.
(5) Trotwood credit card accounts can be used for the following types of purchases:
A. Travel Expenses. Credit cards may be used by authorized individuals for official business-related expenditures for hotel, parking, taxi, meals, gas, airline tickets, emergency City vehicle repairs, and other travel-related expenses as authorized and preapproved by the Finance Director. Under no circumstances can a city credit card be used to make expenditures for the benefit of anyone other than the authorized city employee. Travel expenditures shall not exceed those as outlined in the City’s existing Travel Policy.
B. Purchases.
1. The Trotwood credit card accounts shall have a standard maximum credit limit of three thousand dollars ($3,000). Upon approval of the Finance Director, temporary credit limits can be increased and/or decreased to a level appropriate to address the particular circumstances or events.
2. Credit cards may be used for ordering supplies, including online purchases, when pre-approved by the Department Head and the Finance Director or designee.
3. Credit cards shall not be used, however, for cash advances or personal purchases or expenses, and shall only be used to transact City business.
4. The authorized users are liable in person and upon any official bond the employee has given to the City to reimburse the City the amount for which the employee does not provide itemized receipts in accordance with the policy and procedure described herein.
(c) Compliance Officer Appointment and Responsibilities.
(1) Appointment. The City Manager shall appoint a city employee to serve as Compliance Officer. The Compliance Officer cannot be the Finance Director or Clerk of Council. This employee may not use a credit card account and may not authorize an officer or employee to use a credit card account.
(2) Responsibility. The compliance officer and City Council, at least quarterly, shall review a summary of credit card expenses, the number of cards and accounts issued, the number of active cards and accounts issued, the cards' and accounts' expiration dates, and the cards' and accounts' credit limits.
(d) Finance Director Responsibilities.
(1) Determining positions authorized to use a credit card.
A. The Finance Director is responsible for administration of City credit cards to include, but not limited to, selection of card provider, payment of credit card bills, managing issuance of cards, and ensuring proper use.
B. Whenever a City credit card holder suspects the loss, theft, or possibility of unauthorized use of the card, the employee shall notify the Finance Director in writing. The Finance Director, in turn, shall immediately notify cardholder services to place a hold on the relevant account.
C. The Finance Director or designee should review, approve, and determine when a credit card account will be opened. Cards may be used by City employees only. Each card will be in the name of the City of Trotwood and the Departments. Generally the following positions will be authorized to use a credit card account:
- Mayor
- City Council Members
- Clerk of Council
- City Manager and/or Designee
- Deputy City Manager
- Finance Director and/or Designee
- Assistant Finance Director
- Police Chief and/or Designee
- Fire Chief and/or Designee
- Department Directors and/or Designee
- Department Heads and/or Designee
D. Cardholders shall return City credit cards to the Human Resource Manager or the Finance Director upon ending City employment. Cards returned to the Human Resource Manager shall be returned to the Finance Director.
(2) Overseeing appropriate use of the card. Finance Director or designees will:
A. Review all credit card transactions and management reports to ensure that the cards are being used appropriately.
(3) Ensuring documentation requirements are met. Finance Director or designees will:
A. Ensure necessary detail and documentation are provided on all transactions.
B. Ensure that itemized receipts and card statements are retained and kept in accordance with the City’s Records Retention Schedule.
(e) Rules and Procedures for Use.
(1) The card is for City approved expenses only. It must not be used for personal purchases.
(2) The card is not transferable. It may be used by authorized city employees only.
(3) Itemized receipts must be obtained for all transactions and submitted to the Finance Director within seven (7) days of the transaction. Itemized receipts should be attached to a form supplied by the Finance Department and it is the responsibility of the card user to fill out the form with all relevant information so that the Finance Department can easily reconcile itemized receipts with the relevant purchase order.
(4) Pyramiding - i.e., dividing one purchase into two or more, in order to stay within your transaction limit - is not allowed.
(5) Card users may not receive cash advances.
(6) Card users are responsible for resolving discrepancies and ensuring credits are received.
(7) Card users may not receive cash back or in-store credits for any refunds or exchanges. Such amounts must be credited to the credit card account. If a supplier mistakenly issues a refund check, it must be submitted to the Finance Department within five days of receipt by the cardholder.
(8) Card users should not pay Ohio sales tax. Card users are responsible for obtaining/resolving sale tax exemptions, especially for internet purchases. The cardholder must tell in-state suppliers the City is exempt from Ohio sales tax. A copy of the City’s Tax Exempt Certificate is available if the supplier needs to see it.
(9) If grant funds are being charged, cardholders are responsible for seeing that all granting agency requirements are fulfilled.
(10) Card users may not make purchases that violate City policy restricting business transactions that may be perceived as a conflict of interest (purchases from a business in which you or a relative have a financial interest).
(f) Documentation Requirements.
(1) Employees should always obtain an itemized receipt for each transaction. If a cash register tape does not have descriptions, write them on the tape. Any transaction without a properly substantiated receipt is subject to reimbursement of the City by the employee.
(2) A receipt is defined as an invoice, cash register receipt, sales slip, or packing slip which contains an itemized list of goods purchased, with dollar amounts, and the name and location of the supplier. An employee of the supplier must sign handwritten receipts.
A. Purchases Made in Person. Retain the itemized receipt in addition to the credit card copy to properly substantiate the purchase.
B. Faxed or Mailed Purchases. Retain a copy of the order as faxed or mailed and the fax confirmation (if available) for your records.
C. Internet Purchases. At least one of the following types of documentation is required:
Print out of the completed online order form;
Print out of the online order confirmation; or
Print out of the e-mail confirmation.
(g) Preventing Fraud.
(1) The user must immediately advise the Finance Director if a card is damaged, lost, stolen or the subject of suspected fraudulent activity.
(2) The card user should use basic security measures, as outlined below, to guard against fraud:
A. DO keep the card in a secure location while using; guard the card number carefully.
B. DO save receipts and statements securely. (They may contain the card number).
C. DO keep an eye on the card during the transaction, and retrieve it as soon as possible.
D. DO be aware of what you are signing: Your signature can copy through to other slips deliberately placed underneath.
E. DO visit reputable, familiar merchants whenever possible.
F. DO report possible fraud immediately.
G. DO NOT discard credit card slips in public areas, or discard them whole. Thieves can acquire your card number from receipts, slips and statements.
H. DO NOT lend the card to anyone.
I. DO NOT give the card number to anyone over the phone unless you know you are dealing with a reputable vendor.
(h) Unauthorized Purchases. City credit card accounts may NOT be used to purchase the following items:
(1) Personal items
(2) Clothing
(3) Alcohol and entertainment
(4) Controlled substances requiring a DEA license
(5) Employee relocation and relocation-related expenses
(6) Purchases that involve signing an agreement, license, or contract (e.g., leases).
(7) Long term rentals (one year or longer).
(8) Contracted or personal service providers - specific to unincorporated 1099 service providers (e.g., photographic studios, dry cleaners, physicians, medical labs, auto towing or repair, etc.).
(9) Weapons or ammunition
(10) Donations/Gifts/Flowers
(11) Fuel for a privately-owned vehicle
(12) Purchases or payments that automatically occur on a periodic basis (monthly, quarterly, annually) without expense authorization for each charge.
(i) Inappropriate Use of Cards.
(1) Employees using City-issued cards are responsible for safeguarding the card. If inappropriate use of the card is discovered, disciplinary action up to and including discharge from employment is possible. In the event of fraudulent use, the City may pursue legal prosecution.
(2) Improper costs associated with prohibited purchases will be collected by requesting the employee voluntarily repay the City, by the employee voluntarily agreeing to a payroll deduction or by any legal action available to the City.
(3) Upon the first notice of suspected credit card abuse, the abuse should immediately be reported to the Finance Department, the Compliance Officer and consult with the Law Department.
(4) The Finance Director and Compliance Officer will initiate and coordinate an investigation of the suspected credit card abuse. The employee shall be given an opportunity to respond to the allegations being investigated.
(5) Following the interview with the employee and completion of the investigation, the Finance Director and Compliance Officer shall issue a final written report to the City Manager, Law, Department and Human Resources Manager.
(j) Misuse of a Credit Card Account. The use of a City credit card account for expenses beyond those authorized by this Policy, or any failure to comply with these Credit Card Policies and Procedures, constitutes misuse of a credit card account. An employee who knowingly misuses a credit card account is subject to discipline, which could include demotion, termination, in addition to criminal charges. Use of a City credit card for any use other than those permitted under this Policy section is a violation of section 2913.21 of the Ohio Revised Code.
(k) Employee Acknowledgment. I have read the forgoing Credit/Purchasing Card Policy and acknowledge that I understand it and will abide by its mandates.
(Res. R19-34. Passed 2-18-19.)