325City of Anaheim Administrative Regulation
CHAPTER 3 - FINANCE
Subject: Returned Item Procedures A.R. 325
Issue Date: Mar. 21, 1997
Revised: Sept. 17, 2003
October 31, 2007
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Purpose:
The purpose of this procedure is to provide an overview of the process used for
negotiable items (i.e. checks and electronic payments) that are returned from the bank for
non-payment.
Procedures:
The City Treasurer's Office will receive the returned items from the bank. Upon receipt,
staff will attempt to locate the returned item on the Cash System using the "Reverse
Payment Menu". If the item is found, the System will generate a Notification memo that
will be sent to the Department from which the check originated. The memo will include
the Name of the Party, Check Number (if applicable), Dollar Amount and Reason for
non-payment. A copy of the memo along with the original check, or electronic notice,
will be forwarded to the Collections Division.
If the item is not found on the Cash System, a memo (providing the same information
detailed above) will be prepared, and an entry will be made in the Cash System reversing
the original transaction. A copy of the memo, along with the original check or electronic
notice reflecting all the information identified in above paragraph will again be forwarded
to the Collections Division.
An Edit report will be generated and will be forwarded to the Collections Division along
with the corresponding memo(s) and items(s).
The City Treasurer will assess a twenty-five dollar fee to the originating department at
the time of the returned item. The credit offset will be credited to the City Treasurer's
revenue account.
Responsibility:
Collections Division Responsibilities:
Upon receipt of returned item, memo, and edit listing for all items that have been
reversed, the Collections Division will verify information entered and post those entries
to the Cash System.
Collections will file returned item and memo and maintain for fifteen (15) business days.
City of Anaheim Administrative Regulation 325
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If items are not paid within the allowed time, a cover letter will be sent along with the
unpaid check and memo to the Accounts Receivable Division of the Finance Department
informing them of the outstanding dollar amount due.
City-wide Department Responsibilities:
The department that accepted the initial negotiable item in payment for City services,
permits, fees due, etc., will be notified by the City Treasurer's Department if that item is
returned by the City's depositor bank for non-payment.
It will be the originating department's responsibility to notify the party of the returned
item (sample letter attached). All modifications should include date of return, name of
issuer, check number (if applicable), dollar amount and reason of non-payment .
Notifications should also include date when replacement payment is due (within ten
business days of department's notification), and specify that cash, money order or
cashier's check will be the accepted form of repayment to the City. Along with
repayment, there is a twenty-five dollar returned item fee that is to be included in the
amount due. The department should include appropriate AMS revenue account at the
bottom of the letter for crediting once repayment is received.
If repayment is in the form of cash, the party must take the corresponding notification
letter and the cash payment to the Collections/Cashier. The party will receive a receipt
and the original returned item. If repayment is in the form of a money order or cashier's
check, the originating department shall fill out the COR indicating which account(s) are
to be credited and forward all information to the Collections Division. Upon receiving
such payment and documentation, the Collections Division will forward the customer's
receipt along with the originating department's copy to such originating department. If
the party wishes to receive a receipt immediately, they may then proceed to the
Collections Division as stated previously.
Attachments: Attachment A
Attachment A
Date
Mr. John Doe
1234 Main Street
Anytown, CA 00000
RE: Non -sufficient Funds Item # XXXXX
Amount: $XXXXX
Amount to Redeem: $XXXX
Failure to redeem your non -paid item within 10 days from the date of this notice will
compel us to enforce Section 1719 of the California Civic Code, a copy of which is
enclosed.
In accordance with City Council Resolution No. 2007R-105 and Government Code
Section 157, included in the amount shown is a $25.00 returned check processing fee.
Your original item may be redeemed at the above office.
Please remit certified funds or a money order only. No checks are acceptable on a
returned item(s). We report unpaid debts to Experian.
Collections Representative