AGO Opinion 97010
Authority to Pay Municipal Fees with Credit Cards
DATE: February 6, 1997
SUBJECT: Authority to Pay Municipal Fees with Credit Cards
REQUESTED BY: Senator Ron Withem
Nebraska State Legislature
WRITTEN BY: Don Stenberg, Attorney General
Timothy J. Texel, Assistant Attorney General
You have requested the opinion of this office concerning the
authority of municipalities to accept credit cards for payment of
certain fees. You specifically requested advice regarding whether
the Legislature would have to affirmatively act in order to allow
cities to perform such a function. Due to the number of variables
involved, and that no one statute or case appears to control the
issue raised, there does not appear to be any one clear answer to
We note you mentioned in your request that in a cursory review
of the statutes, you found no statutory prohibition against the
acceptance of credit card payments for municipal fees. In our
research, we likewise did not find any statute prohibiting this
practice. However, due to the nature of the area of law involved,
that determination alone does not answer the issue.
It is well established in Nebraska that municipalities have
only those powers which are expressly conferred on them by statute,
are necessary or fairly implied in order to carry into effect some
enumerated power, or are essential to the declared objects and
purposes of the municipal corporation. State ex rel. Ransom v.
Irey, 42 Neb. 186, 60 N.W. 601 (1894); Giger v. City of Omaha, 232
Neb. 676, 442 N.W.2d 182 (1989); Professional Firefighters Local
385 v. Omaha, 243 Neb. 166, 498 N.W.2d 325 (1993). The Nebraska
Supreme Court has also stated that the powers a municipal
corporation may exercise as essential to its declared purposes must
be indispensable, not simply convenient. Giger at 688, 442 N.W.2d
at 192; Professional Firefighters at 174, 498 N.W.2d at 331. Under
normal circumstances it would not seem necessary for a city to
accept credit cards for municipal fee payments in order to carry
out an enumerated power, and such action would not be essential to
the declared purposes of a city.
Nebraska statutes establish several classes of cities,
according to their population. These categories classify cities as
metropolitan, primary, first class, second class, and villages.
Separate sets of statutes establish the powers available to the
cities within each class. There are also statutes which apply to
all cities and villages. See Neb. Rev. Stat. §§ 18-131 to 18-2808.
There is no statute specifically granting all municipalities the
power to accept credit cards as payment for all types of municipal
fees. Despite the lack of explicit statutory language controlling
the issue, some statutes may grant certain classes of Nebraska
cities the authority to accept credit card payments for certain
One statute which may authorize acceptance of credit cards for
municipal fees is Neb. Rev. Stat. § 18-509. That statute begins by
stating that "The mayor and city council of any city, or the board
of trustees of any village, in addition to other sources of revenue
available to the city or village, may by ordinance set up a rental
or use charge, to be collected from users of any system of
sewerage, and provide methods for collection thereof. . . ." Neb.
Rev. Stat. § 18-509(1) (1991). Similar language is provided
specifically for metropolitan cities in § 14-365.10 (1991). The
term "methods for collection" is not defined, and it is not clear
whether such a term would be broad enough to allow a city to enact
ordinances establishing acceptable methods of payment, such as
credit cards, as well as collection procedures such as mailing
monthly bills. If it were determined that "methods for collection"
includes setting acceptable payment methods, the statute would
appear to allow, by fair implication, municipalities to accept
credit cards for payment of fees if authorized by ordinance.
It should be pointed out that § 18-509 applies only to fees
charged for sanitary sewer services, not all municipal fees. Also,
the statute goes on to state:
All money raised from the charges . . .shall be used for
maintenance or operation of the existing system, for
payment of principal and interest on bonds issued . . .
or to create a reserve fund for the purpose of future
maintenance or construction of a new sewer system for the
city or village. Any funds raised from this charge shall
be placed in a separate fund and not be used for any
other purpose or diverted to any other fund.
Neb. Rev. Stat. § 18-509(2) (1991). Again, very similar language
is found in § 14-365.10.
The above language raises an additional concern. The
acceptance of credit cards would incur the cost of service fees
paid to the credit card companies, which would have to be deducted
from the total payments collected by the municipality. This
payment may conflict with the statutory mandate that "all money"
raised must be used for the required purposes. Under such an
arrangement, some of the funds would be used to satisfy credit card
company service fees and would not be deposited in the separate
fund. It is therefore not clear whether credit card payments could
be accepted. The Nebraska Supreme Court has stated that "Statutes
granting powers to municipalities are to be strictly construed, and
where doubt exists, such doubt must be resolved against the grant."
Professional Firefighters at 175, 498 N.W.2d at 331-32 (1993)
(citations omitted). When analyzed using this standard, the
potential for ambiguity present in §§ 18-509 and 14-365.10
indicates that a municipality may not have the authority to accept
credit card payments for sanitary sewer system use fees.
There are other examples of statutes which may authorize
certain municipalities to accept credit cards, albeit for specific
types of fees. Section 19-1404 states:
19-1404. Municipal heat, light, and ice plants;
management; rates; service. When any such utility shall
have been established, the municipality shall provide by
ordinance for the management thereof, the rates to be
charged, and the manner of payment for service or for the
Neb. Rev. Stat. § 19-1404 (1991).
The language in the above statute appears to provide cities
and villages with the authority to allow payment of certain utility
bills with credit cards. Section 19-1404 does not apply to
metropolitan cities because it appears in chapter 19, article 14 of
the Nebraska Revised Statutes. That article applies to all cities
except cities of the metropolitan class. But the authorization
extends only to the manner of payment for municipal light, heat,
and ice utility services. It does not authorize credit card
payments for any other municipal fees. A similar provision
authorizing municipalities other than metropolitan class cities to
provide by ordinance for the manner of payments for garbage
disposal services is set out in Neb. Rev. Stat. § 19-2106 (1991).
Neb. Rev. Stat. § 16-682 (1991), which pertains to public
utilities operated by cities of the first class, states that "water
taxes, rents, or rates shall be paid and collected and such lien
enforced in such manner as the council or commission, as the case
may be, shall by ordinance direct and provide. . . ." As with the
previously mentioned statutes, this statute allows certain cities
the authority to enact ordinances allowing for the manner of
payment for specified utility services. The statutory language
appears to provide cities of the first class with the authority to
accept credit cards for payment of water service fees if provided
for by ordinance. A similar provision pertaining to waterworks in
cities of the second class and villages is set out in Neb. Rev.
Stat. § 17-538 (1991).
The above examples provide an illustration of the numerous
limitations and variables present in many of the statutes affecting
the area of whether municipalities can accept credit card payments
for fees. Other statutes specifically mention credit card
payments, although not necessarily in the context of municipal
Several statutes explicitly authorize credit card payments for
fees and costs charged or taxed by courts. See Neb. Rev. Stat. §§
25-2710 (1995), 29-424 (1995), and 32-1549(5) (Cum. Supp. 1996).
Individuals may also pay their fines and costs for handicap parking
citations with credit cards. Neb. Rev. Stat. § 18-1741.04 (Cum.
Supp. 1996). Neb. Rev. Stat. § 81-118.01 (1994) allows state
agencies operating a facility in a proprietary capacity to accept
credit cards. Although none of the above-mentioned statutes
directly state whether municipalities can accept credit card
payments, they demonstrate that the Legislature has considered
credit card payments for other state entities and political
subdivisions and enacted specific legislation to allow such
payments. Also, Neb. Rev. Stat. § 77-1702 (1996), which deals
primarily with taxes, states that "Lawful money of the United
States, checks, drafts, money orders or other bills of exchange may
be accepted in payment of any state, county, village, township
school district or other governmental subdivision tax, levy,
excise, duty, custom, toll, penalty, fine, license, fee, or
assessment of whatever kind or nature, whether general or special."
As is demonstrated by the above examples, some statutes
specifically provide for payments by credit cards, while others
provide a list of means acceptable as payment to governmental
entities, which does not include credit cards. This language could
be interpreted as an indication that the Legislature considered the
issue and decided not to provide political subdivisions with the
authority to accept credit cards for payment of all types of
municipal fees. It is a general rule of statutory interpretation
that mention of one thing implies the exclusion of another. Under
this principle the enumeration of certain powers implies the
exclusion of all other powers not fairly incident to the stated
enumerated powers, and an affirmative description of cases in which
certain powers may be exercised implies a negative on the exercise
of such powers in other cases. Hueftle v. Eustis Cemetery Ass'n.,
171 Neb.293, 296, 106 N.W.2d 400, 403 (1960). See also Op. Att'y
Gen. No. 95-067 (August 31, 1995).
In conclusion, when determining whether municipalities have
the ability to accept credit cards for payment of certain municipal
fees, one clear answer controlling the issue does not appear
available due to the number of variables which must be taken into
account. Considerations such as the class of city involved,
whether the statute includes language requiring all money collected
to be deposited in designated funds, and the type of fee, such as
utility charges or fines, can all affect the answer.
In order for it to be clear that all classes of municipalities
are granted the authority to accept credit card payments for all
types of municipal fees, legislation may be necessary. If the
Legislature would deem such legislation appropriate, it may wish to
consider whether a provision should be included in the legislation
addressing whether incurring credit card service charges are to be
considered a power incident to the establishment of credit card
acceptance agreements, notwithstanding language in certain statutes
that all funds from certain fees be deposited in specific funds.
Timothy J. Texel
Assistant Attorney General
cc: Patrick J. O'Donnell
Clerk of the Legislature