Title
Employee Small Loan Program - RFP 030718 - Amendment (Ordinance S-49172)
Description
Request to authorize the City Manager, or his designee, to execute an amendment to Contract 149092 with Employee Loan Solutions LLC., dba. TrueConnect/Sunrise Banks N.A., to extend the contract term for six months. Further request to authorize the City Controller to disburse all funds related to this item. No additional funds are needed as the request is to continue using Ordinance S-45017.
Report
Summary
This contract will provide an employee loan program which can provide City employees with a resource to secure safe, affordable, small-dollar loans (up to $5,000) to avert financial emergencies and ease financial stress. Loan payments are deducted from each paycheck over 12 months. Loans are made by an FDIC-insured lender with a reasonable interest rate of 19.9 percent and offer an alternative to title loans and payday loans, which typically carry extremely high interest rates. There are no origination fees or other fees assessed on the loan. Loan eligibility is not dependent upon personal credit score and a borrower's personal credit score is improved upon complete loan repayment. The contractor's plan is supported by a comprehensive employee financial wellness program which can help employees get out of the cycle of debt. This program is provided at no cost or liability to the City.
Contract Term
Upon approval the contract will be extended through June 30, 2023.
Financial Impact
This program is provided at no cost or liability to the City, and there is no impact to the General Fund. The costs for these services are paid by monthly payroll deductions from participants in the loan program.
Concurrence/Previous Council Action
The City Council previously reviewed this request:
• Employee Small Loan Program Contract 149092 (Ordinance S-45017) on Sept. 19, 2018.
Department
Responsible Department
This item is submitted by Assistant City Manager Lori Bays and the Human Resources Department.