Background:
On March 23, 2021, the City of Sunrise City Commission approved the purchase of payment services from American Express Travel Related Services Company, Inc. (AMEX) utilizing State of Florida Contract No. TR229 for a five (5) year term through March 3, 2026. The purpose of that approval was to allow the City to accept American Express credit and debit cards as additional forms of payments for services.
Prior to that, in 2016, the City Commission also approved the use of a State of Florida contract to procure similar payment services. The City has historically utilized State of Florida contracts for these services and has successfully accepted such payments under those agreements.
The City was notified that the State would not be renewing or replacing that contract. The State identified one potential contract available to municipalities through a third party and advised that another option was to execute a contract directly with AMEX. Staff evaluated the potential governmental contract for use through a third party, the pricing structure was not comparable as the discount was contingent on the amount of services provided and the services offered were more robust that what the current needs are for the City. Additionally, there would have been an implementation period that would potentially cause disruption of these services.
In order for the City to continue to provide a high level of service to residents and customers, the Finance and Administrative Services Department requires a mechanism to procure these credit card processing services moving forward. Staff has worked directly with AMEX on an agreement suitable for the City and AMEX has extended the same discount rates as previously extended to the City under the State's contract - a discount rate of 2.15%. Staff also identified two other governmental contracts with AMEX that contain the same discount rate of 2.15% resulting in fair and reasonable pricing.
The proposed agreement contains certain standardized provisions in the credit card industry that are not customarily agreed to by the City, including broad indemnification obligations, mandatory dispute resolution procedures, venue in New York, and binding arbitration requirements. Notwithstanding these unconventional terms, risk management recommends approval as a business decision due to the significant public benefit of enabling residents and customers to pay various City fees using AMEX credit cards, thereby enhancing customer service, convenience, and payment flexibility for the community.
To avoid disruption and ensure continuity of AMEX payment acceptance and to maintain service options for residents and customers, Staff is seeking to enter into a direct agreement with American Express Travel Related Services Company, Inc.
Pursuant to Section 5-173(c)(5) of the Code of Ordinances of the City of Sunrise Florida, the City’s formal bidding procedures are waived for good cause for the reasons set forth in this Agenda Item Request.