Item 4: Ordinance Concerning Used Merchandise Dealers

Home Browse Search

ALTERNATIVE FUNDING MODELS FOR AUTOMATED REPORT OF USED MERCHANDISE TRANSACTIONS At the request of a City Council member staff have prepared two alternative models that could be used to fund automated reporting of transactions by used merchandise dealers. OPTION “B” Financial Considerations: In Option ‘B’, the city of Eugene would fund the entire cost of the automated system. Each jurisdiction would continue with their updates to the Used Merchandise Ordinance to require automated reporting and through an Inter-governmental Agreement would agree that Eugene would finance the entire cost of the program. The used merchandise stores would pay no fees to participate in the program, but would be required to report transactions electronically. The nominal cost of providing a computer and internet connection to record and transmit the electronic data could be the responsibility of the participating businesses or the city of Eugene could purchase equipment and services for the businesses. Eugene would still administer the program and would pay the contract with the third-party vendor. The cost to the City of Eugene is estimated at an annual figure of $22,000, excluding the purchase of computers and internet connection. Implications: A regional model is essential to ensure the viability of the automated reporting system. (Without regional participation, stolen merchandise can more easily be resold in other jurisdictions, thus thwarting the matching of stolen property to items being purchased by the used merchandise dealers.) Option ‘B’ would require the city of Eugene to subsidize the cost of the automated electronic reporting system for some stores which are located in Springfield and the unincorporated areas outside of Eugene. A project driven and financed by the city of Eugene may garner less participation by merchants and law enforcement than Option ‘A’ which connects each jurisdiction’s stores with that jurisdiction’s law enforcement system. Because privately operated secondhand or used merchandise stores require a level of police oversight for the safety and welfare of the public, the city of Eugene would be using general funds to subsidize the cost of improving this oversight system through automated reporting. Choosing to pay the fees for private businesses in Option ‘B’ may set a new precedent for City of Eugene initiatives or changes to the City Charter that are designed to benefit public welfare and as a result have a financial impact on individuals or businesses. OPTION ‘C’ Financial Considerations: In this model, each jurisdiction could decide independently how they would pay for the program. The Intergovernmental Agreement would specify the funding share provided by each participating agency or the fees coming from used merchandise stores located in each jurisdiction. Eugene would still administer the program, but the cost of administration would increase considerably due to the complexity of this option. We are unable at this time to provide an estimate for administration expenses due to the choices that need to be made in developing this model.