Meeting Date:   7/15/2019 - 7:00 PM
Category:   Action Considerations
Type:   Action
Subject:   Action Consideration #1907-15 - Approval - Arbiter Pay Settlement Bank Account with Bank of Utah
File Attachment:  
Summary Currently the District authorizes and pays athletic officials through a paper process that involves the athletic director or assistant athletic director gathering signatures and updated addresses from officials working LTHS athletic events and sending the paperwork over to the Business Office for weekly issuance of paper checks, which are mailed to officials. Athletic Director, Mike Dwyer, and I would like to switch to an electronic process using the vendor that the IHSA is using for paying post season contest officials, ArbiterPay. There no contract with ArbiterPay. The District would be able to stop using them at any time. The cost to the District for this service $2.10 per transaction, which I estimate will amount to a total cost of somewhere between $1,500 and $2,000 per year based on the number of officials checks issued in the 2018-19 school year. Postage alone on the approximately 800 checks that were mailed to officials in 2018-19 was around $400. Since ArbiterPay will also handle the 1099 tax reporting for officials, the District will save the cost of issuing and mailing 1099s as well. Time will also be saved in both the Business Office and the Athletic Office from no longer having to collect officials' signatures; key, print and mail paper checks; investigate returned checks and illegible addresses on pay vouchers; collect W9 tax forms, etc.

Setting up the service with ArbiterSports, the company that owns the ArbiterPay product, requires the District to open up a new trust bank account with the Bank of Utah. (ArbiterSports is a Utah-based company.) The account would be in the District's name with ArbiterSports being able to issue electronic payments to our officials from it, much like the bank account set up for the District's Flexible Spending Plan for employees. (WageWorks, the District's third party administrator for our Flexible Spending Plan issues payments from a separate bank account that the District established with Board approval at BMO Harris Bank back when the Flexible Spending Plans were established.) The District would most likely fund the account annually, which is what we do for the Flexible Spending Account. I estimate the amount needed to pay officials each year would range from $55,000 to $75,000; this is the amount that would be transferred into the account at the Bank of Utah on an annual basis. The bank account would be listed as a separate account on the District's Statement of Position (Balance Sheet). The electronic process would be set up so that the Athletic Director or Assistant Athletic Director can authorize which officials worked LTHS athletic events and therefore should get paid and the Business Office can approve and release the payments on a weekly basis like we do now.

While the cost of this service would not normally require specific Board approval, only the Board of Education can authorize that a bank account be opened in the District's name.
Recommendation I recommend that the Board of Education authorize the Director of Business Services to open a trust bank account with the Bank of Utah for the purpose of paying athletic officials electronically from it using the ArbiterPay service.
Recommended By:
Signed By:  
Stefanie Croix - Director of Business Services
Signed By:  
Robert McBride Ed.D - Superintendent