TREASURER ‑- COUNTIES ‑- TAXATION ‑- PROPERTY ‑- PAYMENT BY CREDIT CARD
1. RCW 84.56.023 authorizes counties to accept payment of property taxes by credit card. If the county utilizes this procedure, it must collect fully payment of taxes, interest and penalties without discount.
2. RCW 84.56.023 does not grant the county the authority to collect from the taxpayer a service fee on behalf of the bank issuing the credit card.
- - - - - - - - - - - - -
January 22, 1991
The Honorable C. C. Bridgewater
Cowlitz County Prosecuting Attorney
Hall of Justice
312 Southwest First Avenue
Kelso, Washington 98626
Cite as: AGO 1991 No. 2
Dear Mr. Bridgewater:
You requested our opinion regarding the arrangements that a county treasurer can make with banks to allow the payment of property taxes by credit card as authorized under RCW 84.56.023. Your letter described a proposed arrangement as follows:
1. The bank would charge the taxpayer a service fee for the privilege of paying taxes by credit card.
2. The treasurer would collect this service fee when the taxes are paid, and would issue the taxpayer both a credit card receipt and a tax receipt.
3. The treasurer would deposit the service fee into a special account on a daily basis, and the funds in the account would be periodically remitted to the bank.
[[Orig. Op. Page 2]]
The arrangement you describe raises two questions.
1. What are the minimum requirements for accepting payment of taxes by credit card which meet the conditions imposed by RCW 84.56.023?
2. Does the county treasurer have authority to collect from the taxpayer a service fee on the bank's behalf?
1. The minimum requirements for accepting payment by credit card is that the county receive full payment of the tax interest and penalties without discount.
2. The answer to this question is no because we do not believe that the authority for a county treasurer to collect a bank's service fee from a taxpayer using a credit card is implied from the powers expressly granted by RCW 84.56.023.
What are the minimum requirements for accepting payment of taxes by credit card which meet the conditions imposed by RCW 84.56.023?
Counties are authorized to accept payment of property taxes by credit card under RCW 84.56.023, Laws of 1989, ch. 378, § 38, p. 2006:
In the payment of taxes, interest, and penalties, the county treasurer may accept in lieu of cash a credit card issued by a bank or other financial institution if the bank or financial institution guarantees full payment of the amount due, without discount or other cost or charge, to the county.
Any procedure used to accomplish payment by credit card must assure that the bank accepts responsibility for all transaction costs. The bank must also guarantee that the county is fully paid the amount due for taxes, interest and penalties. In discussing the first question raised, we assume that the county treasurer accepts only credit cards issued by a bank or other [[Orig. Op. Page 3]] financial institution,1/
and that each bank involved in the payment arrangement has agreed to guarantee full payment of the taxes due without discount or other charge to the county. In other words, the discount ordinarily paid by a retail merchant, for example, would not be a proper charge to the county.
In the arrangement you describe, the bank has not imposed any discount or direct charge on the county for processing credit card payments. Therefore, that part of the proposed arrangement would meet the requirements of RCW 84.56.023 because the taxpayer pays the bank's service fee.
Does the county treasurer have authority to collect from the taxpayer a service fee on the bank's behalf?
The language of RCW 84.56.023 contains no express authorization for the county treasurer to collect a service charge from the taxpayer either for the county's own reimbursement or on behalf of a bank. With the exception of counties operating under their own charters as permitted by Const. art. 6, § 4 (amend. 21),2/
counties may exercise only those powers granted by the constitution or statutes, either expressly or by necessary implication. Pacific First Fed. Sav. & Loan Ass'n V. Pierce County, 27 Wn.2d 347, 178 P.2d 351 (1947);State ex rel. Bain v. Clallam Cy. Bd. of County Comm'rs, 77 Wn.2d 542, 548, 463 P.2d 617 (1970); Mochizuki v. King County, 15 Wn. App. 296, 298, 548 P.2d 578 (1976).
The term "necessary" as used in the implied powers doctrine refers to legal rather than actual necessity. State ex rel. State Bd. of Med. Examiners v. Clausen, 84 Wash. 279, 282, 146 [[Orig. Op. Page 4]] P. 630 (1915). Implied powers are those indispensable in carrying out powers which have been expressly granted to an agency. Brown v. MacPherson's, Inc., 86 Wn.2d 293, 304, 545 P.2d 13 (1975). The statutory language must support a finding that the Legislature intended to grant the power in question as necessary to carry into effect an express power. See, for example,Chemical Bank v. WPPSS, 99 Wn.2d 772, 791-792, 666 P.2d 329 (1983).
The collection of a bank's service fee does not meet the implied powers test. The payment of taxes by credit card does not necessarily require the collection of a bank's service fee by the county treasurer. County treasurers have only those powers which have been expressly delegated to them by specific statutory authority or by necessary implication. See,State ex rel. Taylor v. Superior Court, 2 Wn.2d 575, 580, 98 P.2d 985 (1940). We can find no provision in our statutes which would allow the county treasurer to collect a service fee from a taxpayer who uses a credit card, nor can it be implied from a reading of RCW 84.56.023 that such authority exists.
In those instances where the Legislature has authorized collection of service fees, it has done so expressly. For example, the county auditor and clerk are authorized to impose service fees under RCW 36.18.010 and [36.18] .020; the board of commissioners of any fire protection district is authorized to impose a service charge under RCW 52.18.010. The county treasurer is authorized to collect a service fee from political subdivisions when the treasurer is handling funds for their accounts. RCW 36.29.180. In none of these examples is the county treasurer or other county officer given authority to collect a service fee on behalf of any private party.
Therefore, we conclude that the authority to collect a service fee cannot be implied from the power to accept credit card payment of taxes. "If there is a fair or reasonable doubt as to whether or not a particular power has been granted, it must be denied." Washington Educ. Ass'n v. Smith, 96 Wn.2d 601, 607, 638 P.2d 77 (1981).
[[Orig. Op. Page 5]]
We trust the foregoing will be of assistance to you.
Very truly yours,
KENNETH O. EIKENBERRY
JANET E. FRICKELTON
Assistant Attorney General
1/RCW 84.56.023 refers to "a bank or other financial institution" which, for convenience, will be identified generically as a "bank" in this opinion.
2/We note that the Cowlitz County is not a home rule charter county. This opinion does not address your questions vis-a-vis home rule charter counties. Any inquiry into the power of a home rule charter county to collect a service fee on behalf of a bank will involve additional considerations such as whether the arrangement violates the gift or lending of credit provisions in Const. art. 8, § 7, or whether the county needs to comply with any applicable regulations pertaining to credit card transactions or whether the county incurs any indirect costs which are ultimately the bank's responsibility.