Convenience at a cost: Water authority considers surcharge

Sep. 20—Many Meadville residents could soon be paying more for their water bills, but not because of a rate increase.

Instead, it's the cost of convenience.

Meadville Area Water Authority (MAWA) board members are expected to vote today on a $2 surcharge for customers who pay by credit card or e-check.

The convenience charge is designed to offset fees being charged to the authority for such transactions, according to MAWA officials, and it's the latest example in a trend growing more common among local public agencies.

"I just think it's getting so expensive that we have to do something," MAWA board President Tim Groves said at the board's August meeting, the second consecutive month the topic had been discussed.

Business Manager Yvonne Shaffer said transaction fees are costing the authority about $40,000 annually.

The change, if approved, would not affect customers who pay by traditional check or by electronic funds transfer from a bank account.

Customers currently pay no surcharge when they use a credit card to pay their monthly bills.

The proposed $2 fee would be a flat rate for all customers paying by credit card, regardless of the size of their bill. Shaffer told the board that the fees MAWA pays for such transactions vary widely from one credit card company to another.

"It's not really straightforward," she said. "Some charge ridiculous amounts and some charge almost nothing."

Passing along the precise percentage charged to each individual customer isn't feasible, she added, because "it would be impossible to program in" to the authority's billing software.

While MAWA considers a flat, per-transaction fee, other local agencies have adopted a flat percentage for credit card transaction surcharges. Groves, who also serves as Meadville's finance manager, noted that the city has been charging a fee for years. This approach can act as a deterrent to credit card payments, according to Groves.

"When somebody wants to pay a real estate bill," he said, "they have to think twice."

The city began accepting credit card payments at the treasurer's office in 2015, according to Treasurer Michelle Sampson. The 2.99 percent fee assessed on each credit card transaction is set by the vendor who handles collection services and carries a minimum amount of $2.50. In contrast to the MAWA proposal, the city also charges a flat fee of $2.50 for electronic debt transfers directly from a bank account.

Sampson said customers usually don't complain about the fee.

"Most customers will usually opt to pay cash or check if they are paying larger amounts. If they are paying for something that is under $100," she said, "they usually will charge it."

Introducing fees after customers have become accustomed to credit card transactions without a fee, as MAWA is considering, can draw attention to the process.

The Vernon Township Water Authority has been charging a flat fee of $3 per credit card transaction since it began accepting credit cards and has not received any complaints, according to Township Manager Rob Horvat, who also serves on the board that oversees the water authority.

But when Meadville Market House approved a 2 percent surcharge for purchases early this year and put a notice near the register that the fee would go into effect in April, a few people expressed frustration, according to Paula Burleigh, who chairs the board that oversees the Market House.

Board members unanimously approved the surcharge after learning that the Market House spent about $5,000 on transaction fees in 2022 — a year in which the market lost about $10,000 overall.

Since it was implemented, however, Burleigh said there have been few cases of people criticizing the fee.

"I think the idea of the fee was more objectionable than the surcharge in practice," Burleigh said in an email. "If you spend $30 at the Market House and you use a credit card, you will pay a 60-cent transaction fee. People seem more likely to be upset about the idea of 2 percent than the reality of 60 cents."

If the MAWA board approves the proposed surcharge today, it could go into effect as soon as next month, according to Groves.

Mike Crowley can be reached at (814) 724-6370 or by email at mcrowley@meadvilletribune.com.