Florida Clerks Rake in Thousands and thousands for Retirement From Management of E-Submitting Portal – Courthouse Information Service

Screenshot from the Civitek website.

If Floridians gain access to the state’s judicial system, an association of elected officials tasked with overseeing the courts will make millions in providing health care to retired clerks.

(CN) – With 15 board members and more than 100 employees, Florida court clerks and auditors act as gatekeepers for attorneys and local residents who have access to the state court system.

Through their own for-profit company, CiviTek, clerks manage a number of websites that process an estimated $ 500 million in transactions and charge millions in convenience fees each year.

Every time a lawyer files a lawsuit, a married couple files divorce papers, or a parent pays child support and pays with a credit card, they have to navigate portals created by CiviTek and increase the company’s 3.5% convenience fee.

Employees say all of the money CiviTek makes will be paid to run the company and additional funds will be reinvested in new technology to protect against unforeseen events like power outages caused by a catastrophic hurricane.

However, a portion of CiviTek’s profits go directly to the Employees’ Association, including a well-funded health insurance plan and money for multi-day conferences and workshops at hotels and resorts across the state.

Florida court clerks and auditors founded CiviTek in 1991 to provide “business services and project management services, including information technology,” according to association documents.

Through CiviTek, the employees’ association has set up its own provider, which uses MyFloridaCounty.com and MyFloridaRemit.com to conclude contracts with government agencies worth several million dollars to process payments for child benefit and tickets.

A 3.5% convenience fee was charged for these payments – more than any other electronic payment provider in the state.

Then Florida law gave employees the go-ahead to file new lawsuits and other legal proceedings electronically. In 2010, employees pushed for the Florida Courts e-filing authority to be established – an organization tasked with creating and maintaining this e-filing system.

In 2013, an order from the Florida Supreme Court ordered that all attorney court records should flow through the e-filing portal. The employees who were already on the board of directors of the Florida Courts E-Filing Authority used CiviTek to implement the change along with the 3.5% fee for each filing.

There is a $ 14 fee for a standard civil lawsuit filing fee of $ 400. There is a flat fee of $ 5 for electronic checks. These harmless fees add up to an astonishing amount of money: more than 1 million e-filings go through the portal every month.

The Employees’ Association keeps the money generated by the E-Filing Authority, which is put back into operation. However, the association hires the agency to use its Civitek-developed software and services for $ 3.5 million per year.

In fact, the employees’ association sells its software and services to government agencies that are required to accept such filings through a government mandate, and then take advantage of the fees generated.

And all the time, its members sit on a board that controls the terms of the contract.

In 2012, the Employees’ Association expanded CiviTek’s business model to form CiviTek National Inc.

This nonprofit provides child support payment processing for states and territories outside Florida, including Oregon, Washington, Hawaii, Maryland, New Jersey, and the US Virgin Islands.

According to company documents, the CiviTek National Board consists of three clerks appointed by the presidents of the association and CiviTek. These officials run a nationwide, profitable business that provides payment processing services for states and territories other than Florida, including Oregon, Washington, Hawaii, Maryland, New Jersey, and the US Virgin Islands.

CiviTek National’s financial data is also not made publicly available, although a 2017 audit by the Employees’ Association and Form 990 shows cash flows between the two companies.

The exact amount of money CiviTek, CiviTek National and the Employees’ Association will receive is unclear, as is the location where the funds will be spent. The Clerks Association, a not-for-profit organization, and CiviTek, a Florida not-for-profit company, are not governed by Florida Public Records Act.

The Employees’ Association has refused to provide CiviTek or CiviTek National financial statements. However, as a not-for-profit organization, the Employees’ Association must file a Form 990 with the Internal Revenue Service each year.

The last three years of the Form 990s, recently received by Courthouse News, shows the Employees’ Association brings in tens of millions of dollars each year.

The Employees’ Association ended 2019 with revenue of more than $ 22.4 million and assets of $ 31.4 million. According to the documents, the association’s income in 2018 and 2017 reflects similar figures.

Records show that a large portion of the money received is used for exchange fees that cover the acceptance of credit card-based transactions, server maintenance and office expenses by a bank.

The association also has several employees including CEO Chris Hart IV who received $ 228,651 in 2019 and CFO Brian Machek who received $ 123,547. A handful of project managers and administrators have also raised more than $ 100,000 this year.

Part of this money also goes into discounts for employees of the employee association.

Pensioners from the association receive a well-funded health reimbursement plan – the Benefit Trust has more than $ 1.7 million according to the latest annual accounts.

Association employees and associates also attend multi-day conferences and workshops at hotels and resorts across the state.

In 2018, the association spent more than $ 242,000 on conferences and meetings, according to its Form 990. This year’s fall conference was held at the Hyatt Regency Hotel on the Jacksonville riverside.

Records show the club also spent $ 436,000 on travel expenses that year.

In 2019, the association spent $ 109,000 including a summer conference at the Omni Orlando Resort in Championsgate. The club also spent $ 211,000 on travel.

A class action lawsuit by two Orlando area women is currently pending in the Tallahassee State Court. The women claim the employees founded CiviTek and CiviTek National to crowd out competition and charge excessive fees in order to achieve their association’s goals.

In an email, Patrick Manderfield, deputy communications director for the Employees’ Association, defended the convenience fees charged by CiviTek.

“Civitek is a privately held supplier in a very competitive industry,” said Manderfield. “Florida law allows a convenience fee to be charged on the hundreds of millions of dollars of transactions that are conducted annually on behalf of the state.”

Much of the revenue, he said, goes toward paying exchange fees collected by the credit card-issuing banks.

Manderfield said the fees “are used responsibly and with prudent control”.

However, Ben Wilcox, director of research at Integrity Florida, a Tallahassee-based government monitoring group, is not convinced.

“The whole arrangement technically looks like it’s legal, but I don’t think the public would like the look,” Wilcox said.

“People who have gotten into tough times or are getting divorced don’t want to feel like the employees benefit from them,” he added.

Other vendors contracting with government agencies charge fewer convenience fees, and opening up offerings to other vendors could help maintain healthy competition and reduce costs for those who have access to the courts.

“It’s worrying that there is no accountability here,” said Wilcox. “Nobody raises questions about whether the money is being used as efficiently as possible.”

The lack of transparency can also open the door to wrongdoing.

In December, the Leon County Sheriff’s Office arrested the association special events manager on suspicion of embezzling more than $ 175,000.

According to the affidavit, KayDubois Carson, who helped organize the association’s annual conferences, used an association credit card to pay for unauthorized flights to Mexico and Europe and leadership seminars. Investigators also say she used the credit card to purchase a tattoo, computer, clothes and makeup over a 21 month period from 2017 to 2018.

The association’s CFO discovered the purchases last autumn and alerted the authorities.

Carson pleaded not guilty, court records show.

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