PLEASE NOTE: Publication for public comment is not, and shall not, be construed as a recommendation or approval by the Board of Trustees of the materials published
Proposed Rule Authorizing the State Bar to Charge a Processing Fee for the Use of a Credit Card, Debit Card, or Electronic Funds Transfer
The State Bar currently allows members to pay their annual membership fees by credit card, debit card or electronic check. When these payments are made, the State Bar is required to pay a processing fee. A processing fee is the amount the recipient of the payment is required to pay to process the transaction, and results from arrangements that can involve financial institutions, credit card companies, and third-party processors. The State Bar currently absorbs the processing fees.
Under Business and Professions Code section 6140, the State Bar has the authority to adopt a rule that would permit the State Bar to charge members an additional fee to defray the cost incurred by processing fees relating to the payment of annual membership fees. Section 6140 provides:
(a) The board shall fix the annual membership fee for active members for 2016 at a sum not exceeding three hundred fifteen dollars ($315). (b) The annual membership fee for active members is payable on or before the first day of February of each year. If the board finds it appropriate and feasible, it may provide by rule for payment of fees on an installment basis with interest, by credit card, or other means, and may charge members choosing any alternative method of payment an additional fee to defray costs incurred by that election. (c) This section shall remain in effect only until Jan. 1, 2017, and, as of that date, is repealed, unless a later enacted statute, that is enacted before Jan. 1, 2017, deletes or extends that date.
(a) The board shall fix the annual membership fee for active members for 2016 at a sum not exceeding three hundred fifteen dollars ($315).
(b) The annual membership fee for active members is payable on or before the first day of February of each year. If the board finds it appropriate and feasible, it may provide by rule for payment of fees on an installment basis with interest, by credit card, or other means, and may charge members choosing any alternative method of payment an additional fee to defray costs incurred by that election.
(c) This section shall remain in effect only until Jan. 1, 2017, and, as of that date, is repealed, unless a later enacted statute, that is enacted before Jan. 1, 2017, deletes or extends that date.
(Bus. & Prof. Code, § 6140.)
The proposed new State Bar Rule would cover the payment of “annual membership fees” as that term is defined in State Bar Rules, Title 2, Division 2, Rule 2.10:
“Annual membership fees” are those fees that any member must pay to maintain active or inactive membership in a calendar year. These fees may include additional assessments and costs prescribed by law.
The proposed new State Bar Rule, Title 2, Division 2, Rule 2.18, would provide as follows:
Rule 2.18 - Payment by credit card, debit card, or electronic funds transfer The State Bar is authorized to charge members who choose to pay annual membership fees by credit card, debit card, or electronic funds transfer an additional fee to defray the costs incurred by that election. The State Bar’s Executive Director or his or her designee is authorized to set the amount of any additional fee the State Bar is authorized to charge members under this rule.
Rule 2.18 - Payment by credit card, debit card, or electronic funds transfer
The State Bar is authorized to charge members who choose to pay annual membership fees by credit card, debit card, or electronic funds transfer an additional fee to defray the costs incurred by that election. The State Bar’s Executive Director or his or her designee is authorized to set the amount of any additional fee the State Bar is authorized to charge members under this rule.
The amount the State Bar would otherwise be required to absorb will vary over time. Increased use results in increased processing fees and decreased use results in decreased processing fees. In addition, processing fees and rates that are charged to the recipient of payments can vary over time. The precise fiscal impact therefore cannot be determined, but staff can make a reasonable estimate based on current usage. Approximately 35-40 percent of the members pay their annual membership fees online. Using these percentages, and an average processing fee of 2.25 percent, the State Bar was required to absorb approximately $512,000 to $594,000 relating to the payment of 2016 annual membership fees. Under this proposal, all associated savings could be invested in the discipline system.
Board Executive Committee – Nov. 4, 2016 – Agenda Memo
Board Executive Committee – Nov. 4, 2016 – Agenda Memo - Attachment A
Board Executive Committee
Monday, Dec. 5, 2016
Dina DiLoreto The State Bar of California 180 Howard St. San Francisco, CA 94105 Email: PublicComment@calbar.ca.gov