002-10 - Resolution - Approval of Agreement with AllianceOne for Municipal Court's Collection ServicesIntroduced by:
Requested by:
Drafted by:
Introduced:
Adopted:
RESOLUfiON NO. 002-10
Court Administrator
Court Administrator
Court Administrator
J anuary 12, 2010
J anuary 12, 2010
A RESOLUfiON OF THE CITY OF PORT ORCHARD,
WASHINGTON, AUfHORIZING THE MAYOR TO EXECUfE
AN AGREEMENT WITH ALLIANCEONE FOR PORT
ORCHARD MUNICIPAL COURT'S COLLECTION
SERVICES.
WHEREAS, The Port Orchard Municipal Court has the authority to use the
services of a collection agency for the purpose of collecting unpaid penalties, fines, costs,
assessments, forfeitures, fees, and any other monetary obligation owed to the Municipal
Court, pursuant to RCW 3.62.040 and RCW 3.50.100(1), now, therefore ;
THE CITY COUNCIL OF THE CITY OF PORT ORCHARD,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
THAT: The City Council hereby approves the AllianceOne Collection
Services Agreement No. C013-10, attached hereto as Exhibit A and by this
reference incorporated herein.
THAT: The Mayor is authorized to execute, on behalf of the City, the
AllianceOne Collection Services Agreement No. C013-10, for Port Orchard
Municipal Court collection services.
PASSED by the City Council of the City of Port Orchard, SIGNED by the Mayor and
attested by the Clerk in authentication of such passage this 12th day q:f-J nua~ 2010/
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COLLECTION SERVICES AGREEMENT
Contract No. C013-10
THIS AGREEMENT (the "Agreemenr) effective the t a day of ~)Qo/ )[l ~L
20 ) () ("Effective Date"), is entered into between The City of Port Orchard on behalfO Port
Orchard Municipal Court ("COURT") and AllianceOne Receivables Management, Inc . ("ARMI'').
For and in consideration of the compensation herein described and the covenants and cond itions
herein contained , the parties agree as follows:
1. Term and Termination. This Agreement is continuing and w ill remain in effect until
terminated by either party. Any ass ignments by COURT and wor k performed by ARMI
prior to the sign ing of this Agreement is specifically approved by the parties and rati fi ed by
this Agreement. This Agreement may be terminated in whole or in part from time to time
when deemed by COURT or ARMI to be in its best interest. Termination of work
hereunder shall be effected by delivering to a party a Notice of Termination thirty (30) days
prior to the specified termination date, detailing the extent to which performance of work
under this Agreement is terminated .
2. Assignment of Accounts. COURT will assign to ARMI for co llection such delinquent
accounts, hereinafter called "accounts ," as COURT deems appropriate.
3. Collection Efforts. ARMI will use commercially reasonable efforts to co ll ect said accounts,
and will confine its efforts to the highest standard of ethical practice . COURT and ARMI
recognize that the appropriate level of activity may vary according to the type of account,
the account balance and the information ava ilable.
4 . Debts Just and Owing . COURT certifies that every account referred will contain accurate
information and will be just and owing , and will not be subject to any valid defense, set-off
or countercla im, including that such account or the obligor of such account will not, to the
COURT's actual knowledge, be subject to any bankruptcy proceeding , stay or discharge as
of the time of referral. COURT shall promptly inform ARMI , in writing , of any notice it
receives concern ing any bankruptcy filing by any debtor.
5. Compliance with Law. ARMI's collection activities shall comply with federal , state and local
laws , including the Fair Debt Collection Practices Act (FDCPA), where applicable.
6 . Legal Action . No legal action will be commenced on any account w ithout written
permission , first obtained , from COURT . Legal action commenced under th is agreement
shall be in the name of.ARMI and not COURT. ARMI will promptly advise COURT if any
legal action is contested . COURT will provide evidence as requested by ARMI to support
approved lega l action, including prov iding a witness or w itnesses for live testimony if
requested . Unless otherwise agreed, legal costs and fees will be paid by ARMI and not
COURT , and will be recoverable from the DEBTOR where allowed by applicable law , out
of first monies recovered .
7 . Insurance . ARMI shall obtain and keep in force continually during the term of the contract
comprehensive general liability insurance coverage in the amount of at least One Million
Dollars ($1 ,000 ,000 .00).
8. Claims against Client. Neither ARMI nor ARMI 's attorneys shall be responsible for
providing COURT with legal representation to defend COURT against any cla ims,
counterclaims or t hird-party claims asserted aga inst COURT, whet her asserted in
resp onse to a colle ction lawsuit initiated by ARM I or otherwise.
COLLECTION SERVICES AGREEMENT Page2
9. Cancellation of Accounts. To the extent practicable and unless otherwise agreed, COURT
will consult with ARMI prior to recalling any assigned account. For any account on which
COURT has approved legal action by ARM I, COURT shall not cancel such account without
first consulting with ARM I.
10. Hold Harmless and Indemnification. ARMI will indemnify and hold harmless COURT, and its
elected officials, present and former employees, predecessors, successors, assigns,
affiliates, clients, subcontractors, insurers, principals, agents, owners, attorneys and
employees from any claim, loss, cost, damage, expense, attorneys' fees, and liability of
whatsoever nature or kind (collectively the "Claims"), arising out of or as a result of the
negligent acts or omissions of ARMI, its employees or agents. COURT will indemnify and
hold hanmless ARMI, its parent, subsidiary, sister and affiliated companies and divisions, and
their officers, directors, shareholders, members, limited and general partners, present and
former employees, predecessors, successors, assigns, affiliates, clients, subcontractors,
insurers, principals, agents, owners, attorneys and employees from any Claims arising out of
or as a result of the negligent acts or omissions of COURT, its employees or agents; and
specifically agrees to indemnify and hold ARMI harmless from and against all Claims
resulting from errors in account information furnished to ARMI by COURT wh.en such error
is the result of negligence. The indemnities provided for herein shall survive the
termination of this Agreement.
11. Compensation and Method of Payment. For services provided pursuant to this Agreement
ARMI shall be entitled to compensation as follows:
A. Pre-Collection Demand Letter: No Charge.
B. Court Costs for Collection Fees: COURT will assess a court cost for ARMI's collection
fee pursuant to RCW 3.02.045. COURT directs ARMI to perform the ministerial act of
adding this cost to the account balance on its computer system at the time the account in
entered into its computer, in the following amounts:
A 19% add-on fee (0.1597 retained) for new accounts assigned to ARMI on and after
the effective date of this contract. Previously-assigned accounts will remain at their
existing rates.
C. Partial Payments: Partial payments made on assigned accounts shall be remitted to
COURT based upon the same pro rata formula applied to accounts that are paid in full. By
way of illustration, and assuming a 19% add-on fee: $100 fine x 19% = $119 new balance
to be collected; a $50 payment received would be remitted as follows: $42.02 to COURT;
$7.98 to ARM I ($7.98 = .1597 of $50).
D. Interest on Accounts: Upon assignment to collection, interest shall accrue on all account
amounts, including court costs for collection fees, at the rate of twelve percent per annum.
The interest shall be added to the account by ARMI, collected by ARMI, and remitted in full
by ARMI to COURT on COURT's portion of the account (interest on the collection fee
portion will be retained by ARMI).
E. Signal Credit Management Services Program (Signal): If COURT desires to offer a time-
payment program to defendants with non-delinquent obligations, ARM I will administer
a monthly-payment collection service (the Signal Credit Management Services Program) for
COURT. COURT will assess as court costs for this service and ARM I will add such costs
(also called "Service Fees") to the accounts as follows:
1. $15.00 Account Set-Up Fee: a one-time charge per obligor per COURT of
. limited jurisdiction (fee charged only once while defendant remains in an
active Signal program, even should new cases from the same COURT be
added to the active program; setting up a new Signal program after a
program has been completed or discontinued requires another Set-up fee).
2. $4.75 Monthly Fee: one charge per defendant with one current case.
09-02-09 WA COURT
COLLECTION SERVICES AGREEMENT Page 3
3. $8.25 Monthly Fee: one charge per defendant with two or more current
cases.
4. $7.75 Monthly Fee: one charge per defendant in "past due status" with one
case.
5. $11.25 Monthly Fee: one charge per defendant in "past due status" with two
or more cases.
ARM! will collected and retain all Signal Service Fees. Where a Signal account is
assigned to full collection, Service Fees shall not be added to the principal amount
of the debt for purposes of calculating ARMI'S Collection Fee authorized in sub-
paragraph B above, but can otherwise be collected.
F. Remittance Method: ARMI shall deduct its compensation from recoveries prior to
remitting COURT's portion to COURT.
G. Change in Law: Should there be changes in laws or COURT policies which
prescribe/allow a different method for recovering Collection Fees, ARMI shall
modify its methods accordingly, upon instruction from COURT.
H. Electronic payments. COURT authorizes ARMI to charge a party making an
electronic payment a reasonable convenience fee for processing the electronic
payment unless prohibited by state law.
12. Payments to Court from Other Source. A payment made on behalf of a debtor directly to
COURT on an assigned account will be promptly reported to ARMI by COURT.
13. Negotiable Instruments. COURT authorizes ARM I to endorse checks or other instruments
payable to COURT and deposit same into a trust account separately maintained by ARM!.
COURT further authorizes ARMI to send notices of dishonor or other notices on COURT's
behalf for dishonored instruments, to assess and collect any permissible dishonored
instrument fees, and to retain any recovered fees, whether such instruments were issued
before or after assignment of the account.
14. Bankruptcy. Where an account becomes subject to bankruptcy proceedings, ARM I will, at
its option, either (a) cancel the account back to COURT, or (b) file a claim on behalf of
COURT. If COURT desires that ARMI file a claim, ARM I will retain the "fee-added" amount
of the account whether or not that fee is allowed by the bankruptcy COURT as an
allowable claim (i.e., if the principal obligation is allowed, but the collection fee is not, ARM I
will deduct its fee from the allowed principal claim on a pro-rata basis).
15. Assignments. Neither party to this Agreement shall assign this Agreement, nor any
interest, right or responsibility arising herein, without the written consent of the other party;
provided that ARM! can forward individual accounts to out-of-state collection agencies if
deemed prudent by ARM I to effect collection. If ARM I forwards an account to an out-of-
state agency, said agency must agree to comply with the terms of this agreement, and
ARMI will indemnify and defend the City should a claim arise as the result of the conduct
of said agency.
16. Waiver. Failure to enforce any provision of this Agreement shall not be deemed a waiver
of that provision. Waiver of any right or power arising out of this Agreement shall not be
deemed waiver of any other right or power.
17. Severability. In the event any term or condition of this Agreement or application thereof to
any person or circumstance is held invalid, such invalidity shall not affect other terms,
conditions, or applications of this Agreement which can be given effect without the invalid
term, condition, or application. To this end the terms and conditions of this Agreement are
declared severable.
09-02-09 WA COURT
COLLECTION SERVICES AGREEMENT Page 4
18. Notices. All notices, requests, demands, consents and other communications hereunder
(excepting those day-to-day communications necessary or desirable in the ordinary course
of performing or facilitating the performance of the services contemplated by this
Agreement) shall be in writing and shall be deemed to have been duly given when either
(a) personally delivered; or (b) when deposited via certified mail, return receipt requests,
postage prepaid to the intended recipient set forth below:
If to ARMI: Harry Neerenberg, CFO
AllianceOne Receivables Management Inc.
4850 E. Street Road, Suite 300
Trevose, PA 19053
With a copy to: Renee Linnabary, SVP
AllianceOne Receivables Management Inc.
6565 Kimball Drive, Suite 200
Gig Harbor, WA 98335
If to COURT: Deborah M. Hunt, Court Administrator
Port Orchard Municipal Court
216 Prospect Street
Port Orchard, WA 98366
19. Taxes. COURT agrees to pay all sales, use or similar taxes as may be applicable to the
services rendered by ARMI.
20. Account Audits. COURT may audit ARMI's records pertaining to accounts assigned for
collection upon reasonable notice.
21. Non-discrimination. ARMI, in its collection efforts, will not discriminate against any
DEBTOR on the basis of race, color, creed, religion, sex, national origin or other protected
status. ARMI will comply with the requirements of the Americans with Disabilities Act of
1992, and all regulations interpreting or enforcing said Act.
22. Beneficiaries to Contract. This Agreement is entered into for the benefit of COURT and
ARMI. No third-party beneficiaries are intended to be created or are created hereunder,
and no other party can derive any benefit herefrom.
23. Enforcement of Underlying Rights of Court. Not withstanding anything in this Agreement to
the contrary, ARMI is specifically granted the right in any dispute, claim, controversy or
action asserted against ARMI by an account debtor or third party, to enforce any right
COURT might have to compel arbitration, or to prohibit a jury trial or class action. ARMI is
authorized to exercise any right COURT might have to call or contact any wireless
telephone or other wireless device manually or by automated means; or to call or contact
any person using a pre-recorded or artificial voice. To the extent provided in this section,
ARMI shall be considered an "agent" of COURT.
24. Entire Agreement. This Agreement constitutes the entire understanding between ARMI
and COURT regarding collection services provided to COURT by ARMI, and may not be
modified except by written agreement signed by both parties. This agreement supersedes
any prior Agreement, unless incorporated herein by reference.
25. Choice of Law and Venue. This Agreement shall be interpreted according to the laws of
the State of Washington. Any judicial action to resolve disputes arising out of this
Agreement shall be brought in Kitsap County Superior Court.
09-02-09 WA COURT
COLLECTION SERVICES AGREEMENT Page 5
26. License. ARMI will supply to CLIENT a copy of its collection agency license within 30 days
of the execution of the Agreement.
IN WITNESS WHEREOF, the parties have executed this contract on the date last written below.
AllianceOne Receivables Management, Inc.
ADDRESS:
6595 Kimball Drive, Suite 200
P. 0 . Box 2449
Gig Harbor, WA 98335-4449
DATE : -v\s\ \ D
09-02-09 W A CO URT
AD ESS:
216 Prospect Street
Port Orchard, WA 98366
DATE: January 12, 2010