Debt Collection Agency Services

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08/02/2024 12:00 PM (PDT)

Laterre Walsh

https://vendors.planetbids.com/portal/15300/bo/bo-detail/120142

Finance Department / Revenue Division

The City of Sacramento, Department of Finance, Revenue Division, is soliciting proposals to prospective collection agencies that are interested in providing their services to provide efficient and cost-effective debt collection services that minimize City costs, maximize the use of available technology, provide excellence client service, and perform thorough and complete collection services.

The successful proposer will be involved in the collection of various city services such as: Community Development fees, miscellaneous receivables, NSF checks, loan repayment, and other fees owed to the city and will add their collection fees to each account to cover all the Agency commission fees, per City Code Section 1.28.040.
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The City of Sacramento is issuing this RFP to invite prospective collection agencies that are interested in providing their services. It is critical that while attempting to maximize the City’s collections, the objective be achieved without negative exposure to the city and with careful consideration of consumer’s rights.
One or more contracts may be awarded under this RFP. Contracts will be extended on a year-to-year basis for up to five (5) years at the discretion of the City Manager unless sooner suspended or terminated by written notice to the agency.

The current Debt Collection Agency Service contract was issued in 2019 and is expiring August 31, 2024. The contract was held by Financial Credit Network.
All collection agency commission fees are added to each account, per City Code Section 1.28.040. For example, the city assigns a $100 account, the agency adds 20% and collects $120 for a net 17% commission. The city is remitted $100.

The city bills for a broad scope of services encompassing several city departments. The city assigned approximately 10,000 accounts from Cannabis, Code, Public Works, Police, Fire, Risk, and other departments to collections over the past 24 months with a combined net value of just over 35 million.

We attempt to assign accounts at 120 days past due. In-house collection consists of phone calls, monthly statements, and a dunning letter.

Accounts are typically only recalled if the billing is found to be in error.

Less than 1% of assigned cases require litigation.

Collection work and support staff may not be offshore.

The preferred method for assigning cases is electronically via a secured portal.
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In response to the Request for Proposals, the City anticipates receiving competitive pricing as well as an assurance of quality services.

The City intends to award one contract, however, it may choose to award additional contracts as the City deems necessary to meet the City’s needs.
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