HomeMy WebLinkAboutAgenda Report - September 5, 1990 (57)C 6 C I 1. C 0 M M U N I C A T O N
TO: THE CITY COUNCIL
FROM: THE CITY MANAGER'S CFFICE
SUBJECT: REPORT ON CITY UTILITIES DEPOSIT POLICY
PREPARED B Y : City Manager
COUNCIL MEETING DATE
SEPTEMBER 5, 1990
RECOMMENDED ACTION: None required. Information only.
BACKGROUND INFORMATION: At the regular meeting of August 15, 1990,
Councilmember Hinchman inquired as to the City's
policy regarding deposits for utilities services.
The attached merino of August 21, 1990 in response
(Exhibit A) has been distributed to the City Council. The purpose of this item
on the agenda is to make public the staff response and to afford Counrilnembers
the opportunity to ask questions in this regard.
Respectfully submitted,
Thomas A. Peterson
City Manager
TAP:br
Attachment
UNC922
MEM3RAN0UM
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M the Honorable Mayor and
Members of the City Council
City Manager
DATE: august 21. 1990
SUBJ: City Policy Regarding Uti 1 ity Oeposits
At its regular meeting of Wednesday, August 15, 1990, City Council heard a
request of Cooncilmer Hinchman that the staff apprise the Council ;of the
City's policy with regard to deposits for utility services. This mum will
serve as the staff response.
Residential Customers - Normally, deposits are not required of
residential' customers. However, a deposit in an amount equal to
two months estimated utility bills is required VF:
• a customer has had utility service discontinued for not
redeeming a returned check
• a customer has had u t i I i ty services discontinued for non-payment
of a past due utility bill
• an applicant for City services has a delinquent City account
with a collection agency
• an applicant for City services does not or will not present
acceptable identification
Commercial and Industrial Customers - All applicants for commercial
and industrial u i i y accounts are required to post a deposit in
an amount equal to two months estimated u t i I i t y b i I I s. This deposit
is required of all new accounts and additional business locations even though
the additional locations are under the same ownership. These deposits are
retained by the City until the account is closed. For example, when the
owner of a video store purchased an existing video store i n another part of
the City, a deposit vvm required on the account at the second store. No
&posit i s required ii -Fan existing business moves to a new location and the
pa,,,nent history has been good.
l_
The Honoraole Mayor and
Members of the City Council
August 21, 1990
Page - 2 -
The reason for the deposit requirement on all new coy
accounts is the result of a number of recent.{within
very unfavorable and expensive experiences endure
industrial customer went bankrupt leaving the; Ctty ^y
this case uncollectible, utility bill -balance of app
failed market cost the City $16,000; another 512,GC
failed left the City with an $11,000 deficit,
approximately. 564,000 in losses with just four bad
for the requirement of deposits is set forth in Lodi
13.04.020 which reads in part: "A deposit for the -46
of service slay be required by the director of1-f inancie
de -ems it to be in the best interest of the:city.".
served well the City and the thousands of conscientio__
their payments on time, for it is the rate payers who suffer the disservice
of the consequence of bad debts. DW inpart to this requirement, the City
in the last 12 months incurred only $110,357 in utility account losses on a
total billing of $35,379,658, The result is an excellent loss ratio of just
.003:.
The City snakes every effort to bring utility service to new customers during
non -business hours. This is sometimes necessary when both the husband and
the wife work during regular City Hall business hours, Such customers are
advised to contact the Electric Utility Department on the City's 24-hour
emergency telephone for after-hours and week -end connections. Service is
usually provided the same day it is requested. These customers are requested
to cmr to City Hall within the next five business days to complete the
paperwork.
Staff will be pleased to provide
Councilmembers may request on this topic.
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C Ott 905
whatever additional information