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HomeMy WebLinkAboutAgenda Report - November 5, 1997 (66)CITY OF LORI COUNCIL COMMUNICATION AGENDA TITLE: Approval of Increasing Late Fees for Past Due Utility Bills MEETING DATE: Novermber 5, 1997 PREPARED BY: Finance Director RECOMMENDED ACTION: That the City Council approve increasing late fees for Past Due Utility Customers in accordance with Option 2 based on staff recommendation. BACKGROUND INFORMATION: On March 4, 1992 the City Council adopted resolution No. 92-41 setting fees in the amount of $10 for the 60 day past due utility customer and $25 for the 90 day past due utility customer. Recent analysis shows that 81% of utility customers pay their utility bill before the next billing period. On an average of 25,000 utility accounts billed each month, the remaining 19% represent approximately 4,750 customers who are in some period of delinquency on a daily basis throughout the monthly billing period. An average of 11% of utility customers carry a 30 day past due amount in arrears, an average of 7% carry a 60 day past due amount in arrears and only 1% carry a 90 day past due amount at the point of the next billing period. Municipal Code currently grants authority to the Finance Director to waive late fees when in his/her opinion a customer has presented reasonable evidence of financial hardship or convincing information that timely payment could not have been expected. It is the policy of the City that the enterprise activities (electric, water, sewer and solid waste) be efficiently managed and based on sound economic principles by following prudent business practices. The City wants to encourage customers to pay utility bills on a timely basis and to discourage delinquent utility bills. The addition of a late fee at the 30 day past due point will allow customers to address payment problems before the dollar amount of the bill is so large that shut-off is unavoidable and payment of delinquent amounts impossible. cont'd APPROVED: Dixon FI nr ilty Manager CITY OF LODI COUNCIL COMMUNICATION Option 1 and Option 2 are based on the numbers of accounts with past due balances at the time the current bill is generated. Current plus 30 day past due balance - 3226 Current plus 60 day past due balance - 1872 Current plus 90 day past due balance - 249 Option 1 - Increase 60 Day Past Due Amount from $10 to $12 and Continue 90 Day Past Due Amount of $25 Option 2 - Add $5 to 30 Day Past Due Amount, Increase 60 Day Past Amount from $10 to $15 and Continue 90 Day Past Due Amount of $25. Staff recommends adoption of Option 2 FUNDING REQUIRED: None Vicky McAthie, Finance Director Prepared by: Maxine Cadwallader, Revenue Manager APPROVED: H. Dixon Flynn -- City Manager DRAFTRESOLUTION NO. 97-184 DRAFT A RESOLUTION OF THE LODI CITY COUNCIL SETTING LATE FEES FOR DELINQUENT UTILITY BILLS WHEREAS, it is the policy of the City Council that the enterprise activities (water, sewer, electric, and solid waste) of the City be efficiently managed and based on sound economic principles by following prudent business practices; and WHEREAS, it is the policy of the City Council to encourage customers to pay utility bills on a timely basis and to discourage delinquent utility bills; and WHEREAS, it is the policy of the City Council that City staff will be sensitive to customer hardships or other unusual circumstances that preclude timely payment of utility bills. NOW, THEREFORE, BE IT RESOLVED by the Lodi City Council that the following late fees for delinquent utility bills is approved and that the Finance Director may waive these fees when in his/her opinion a customer has presented reasonable evidence of financial hardship or convincing information that timely payment could not have been expected: Bill First Second Third Final or OPTION 2 First Second Third Final Dated: November 5, 1997 Amount Utility Rate Only Utility Rate Only Utility Rate plus $12.00 late charge Utility Rate plus $25.00 late charge Utility Rate Only Utility Rate plus $ 5.00 late charge Utility Rate plus $15.00 late charge Utility Rate plus $25.00 late charge I hereby certify that Resolution No. 97-184 was passed and adopted by the City Council of the City of Lodi in a regular meeting held November 5, 1997, by the following vote: Ayes: Council Members — Noes: Council Members — Absent: Council Members — Abstain: Council Members — DRAFT ALICE M. REIMCHE City Clerk 97-184 DRAFT RESOLUTION NO. 97-184 A RESOLUTION OF THE LODI CITY COUNCIL SETTING LATE FEES FOR DELINQUENT UTILITY BILLS WHEREAS, it is the policy of the City Council that the enterprise activities (water, sewer, electric, and solid waste) of the City be efficiently managed and based on sound economic principles by following prudent business practices; and WHEREAS, it is the policy of the City Council to encourage customers to pay utility bills on a timely basis and to discourage delinquent utility bills; and WHEREAS, it is the policy of the City Council that City staff will be sensitive to customer hardships or other unusual circumstances that preclude timely payment of utility bills. NOW, THEREFORE, BE IT RESOLVED by the Lodi City Council that the following late fees for delinquent utility bills is approved and that the Finance Director may waive these fees when in his/her opinion a customer has presented reasonable evidence of financial hardship or convincing information that timely payment could not have been expected: OPTION 2: Council Members — Land, Sieglock and Warner First Utility Rate Only Second Utility Rate plus $ 5.00 late charge Third Utility Rate plus $15.00 late charge Final Utility Rate plus $25.00 late charge Dated: November 5, 1997. I hereby certify that Resolution No. 97-184 was passed and adopted by the City Council of the City of Lodi in a regular meeting held November 5, 1997, by the following vote: Ayes: Council Members — Land, Sieglock and Warner Noes: Council Members — Mann and Pennino (Mayor) Absent: Council Members — None Abstain: Council Members — None &Zi A-&� ALICE M. REI CHE City Clerk 97-184