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AGENDA ITEM REVIEW FORM |
7.F.
Regular City Council Meeting
- Meeting Date:
- 09/10/2025
- Department Head:
- Edgar Esparza
- Submitted By:
- Edgar Esparza, Billing & Collections Manager, Finance Department, Billing & Collections
Action Requested:
Motion
Public Hearing
Resolution
Public Hearing
Resolution
ITEM:
Public hearing followed by discussion and possible action on any and all matters regarding Resolution No. 2374. A Resolution of the Mayor and City Council of the City of San Luis, increasing the fee for collection services on delinquent water and wastewater accounts. (Edgar Esparza, Billing & Collections Manager)
A. Staff Presentation
B. Open Public Hearing
C. Call to the public on this item
D. Close Public Hearing
E. Action on Resolution No. 2374
A. Staff Presentation
B. Open Public Hearing
C. Call to the public on this item
D. Close Public Hearing
E. Action on Resolution No. 2374
SUMMARY:
On July 13, 2011, the City passed Ordinance No.314, which is codified at City Code § 13.15.230(D), which says:
"The City may elect to assign any and all utility accounts considered delinquent with unpaid charges, fees, or assessments to a collection agency or attorney to collect, in addition to the disconnection of any and all services."
On March 8, 2020, the City of San Luis entered into an agreement with Valley Collection Services, LLC, to recover any debt on its utility and ambulance accounts. Valley Collection Agency established a commission fee of 20% on all collections made on our utility accounts. The city elected to add this fee to the customer's utilities account balance. The City recovers 100% of the outstanding amount, and a 20% commission is charged to the account. However, due to the low collection rate of Valley Collection Services, LLC, Billing and Collection explored the option of transferring our accounts to Browns Collection Services, a local collection agency in the Yuma County area. However, Browns Collection Services has a different commission structure and higher commission fees as follows:
The attached Resolution adopts the fee structure of Brown's Collection Services.
"The City may elect to assign any and all utility accounts considered delinquent with unpaid charges, fees, or assessments to a collection agency or attorney to collect, in addition to the disconnection of any and all services."
On March 8, 2020, the City of San Luis entered into an agreement with Valley Collection Services, LLC, to recover any debt on its utility and ambulance accounts. Valley Collection Agency established a commission fee of 20% on all collections made on our utility accounts. The city elected to add this fee to the customer's utilities account balance. The City recovers 100% of the outstanding amount, and a 20% commission is charged to the account. However, due to the low collection rate of Valley Collection Services, LLC, Billing and Collection explored the option of transferring our accounts to Browns Collection Services, a local collection agency in the Yuma County area. However, Browns Collection Services has a different commission structure and higher commission fees as follows:
- 25% commission fee on the amounts collected
- 30% commission fee on all accounts with a balance of under $25.00
- 40% commission fee on accounts referred out of the State of Arizona
The attached Resolution adopts the fee structure of Brown's Collection Services.
RECOMMENDATION / SUGGESTED MOTION:
A. STAFF PRESENTATION
B. MAYOR NIEVES RIEDEL TO OPEN THE PUBLIC HEARING
C. MAYOR NIEVES RIEDEL TO CALL THE PUBLIC ON THIS ITEM
D. MAYOR NIEVES RIEDEL TO CLOSE THE PUBLIC HEARING
E. I MOVE TO APPROVE AND ADOPT RESOLUTION NO. 2374 AS PRESENTED
B. MAYOR NIEVES RIEDEL TO OPEN THE PUBLIC HEARING
C. MAYOR NIEVES RIEDEL TO CALL THE PUBLIC ON THIS ITEM
D. MAYOR NIEVES RIEDEL TO CLOSE THE PUBLIC HEARING
E. I MOVE TO APPROVE AND ADOPT RESOLUTION NO. 2374 AS PRESENTED
Fiscal Impact
- IS THERE FISCAL IMPACT ASSOCIATED WITH THIS ITEM:
- Please see the fiscal impact statement.
- CITY/STATE/FEDERAL FUNDS:
- N/A
- TOTAL:
- N/A
- BUDGETED AMOUNT:
- N/A
- AVAILABLE AMOUNT TO TRANSFER:
- N/A
- ACCT NAME & GL#/REMAINING BALANCE BEFORE PURCHASE:
- N/A
FISCAL IMPACT STATEMENT (IF THIS IS A BUDGET TRANSFER, YOU MUST ATTACH THE BUDGET ADJUSTMENT FORM):
Staff is recommending the change in collection agencies to get better collection results. However, any fiscal impact will not be known until we have some history to compare with the current collection agency.