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A.1. The online event ticket service provider is an event management and ticketing website that facilitates the selling of tickets to events on the internet. The service charges a fee (2% of the ticket price +2.5% processing fee). By using the online event ticket service provider, the District is paying for a service and part of the terms of that service is that the proceeds of ticket sales are transferred monthly by the online event ticket service provider to the “organizer” of the event. While the online event ticket service provider is obligated to transfer those proceeds collected on behalf of the District to the District, the proceeds are not “public funds” until they are actually transferred by the online event ticket service provider to the District. Therefore, the collateralization requirements of the Local Depositories Law (R.S. 39:1211, et seq.) do not appear to apply before the proceeds are transferred to the District.
However, once proceeds are obtained from the online event ticket service provider, the District is required to transfer/deposit the funds into the District’s fiscal agent bank selected under the Local Depositories Law and the funds must be collateralized.
A.2. The District may open a PayPal account, using proper controls for access and use of same. PayPal does not meet the requirements of a depository bank under the Local Depositories Law. Per the PayPal’s User Agreement Terms, PayPal is not a bank and does not accept deposits, both of which are requirements for selection as a depository under the Local Depositories Law. Therefore, funds collected by PayPal do not appear to require collateralization.
Once collected payments are obtained from PayPal, the District is required to transfer/deposit the funds into the public entity’s fiscal agent bank selected under the Local Depositories Law and the funds must be collateralized.
Louisiana Legislative Auditor website: 05/27/2026 12:01:46 PM
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