HOUSE BILL REPORT

SB 5523

BYSenators Halsan, Zimmerman, Garrett and Rasmussen; by request of Department of General Administration

Revising provisions on the administration of the use of credit cards for state institutions.

House Committe on State Government

Majority Report:  Do pass.  (8)

      Signed by Representatives H. Sommers, Chair; Peery, Vice Chair; Baugher, Chandler, Hankins, O'Brien, Sayan and Walk.

House Staff:Pam Madson (786-7135)

AS PASSED HOUSE APRIL 2, 1987

BACKGROUND:

The director of the Department of General Administration is required to develop a program for the use of credit cards by state agencies to make purchases.  The director shall adopt rules governing the use of these credit cards.  The director is also authorized to contract with financial institutions located within the state to administer the state credit card program.

The latter provision effectively bars out-of-state financial institutions from providing the state with credit card administrative services even though no in-state financial institution currently offers such services.

Credit card administrative services include automated management reporting systems.  Such reporting systems could be used to identify those airline routes used most by state agency personnel, who spent approximately $9.8 million on air travel last year alone.  With this information, the state would be able to obtain discounts from airlines for high volume air routes.

SUMMARY:

The director of General Administration is no longer restricted to contracting with in-state financial institutions to administer the state credit card program.

Fiscal Note:      Attached.

House Committee ‑ Testified For:    Meredith Jennings, Department of General Administration.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Currently state law prevents out-of-state credit card vendors from providing the state with administrative service along with the cards.  In-state vendors do not currently offer such administrative services as automated card use monitoring.  This service would allow the state to obtain volume discounts on airlines by identifying airline routes most heavily used by state employees.  Greater state credit card use would reduce agency travel advance costs, improve agency cash flow, and hasten employee travel voucher submittals.

House Committee - Testimony Against:      None Presented.