Direction on Whether to Continue Waiving Late Fee Penalties on Quarterly Utility Bills.

The city's standard process is to charge a 10% penalty on utility accounts (water, sewer, street lights, recycling and storm drainage) that are delinquent.  This penalty is applied on current billings only and does not reassess a penalty on a penalty.

With the onset of the COVID pandemic in 2020, the City Council elected to waive the penalty starting with the 2nd quarter utility bill sent out in July 2020.  The penalty has been waived for 3 billings to date:  July 2020, October 2020 and January 2021.

Attached is a brief summary of the penalties collected in 2018, 2019 & first quarter 2020.  In regards to utility collections, the city certified fewer accounts in 2020 then 2019 (499 vs 556) and the total delinquent amount on September 1, 2020 when the certification process started was $343,386  in comparison to $390,642 in 2019.  The city's collection of the annual property tax also remained constant with 2019 levels.

The City's utility billing provider, OPUS 21 said that they are currently waiving the late fees for the cities of Ramsey, Wyoming and Andover, but the cities of Cottage Grove, St. Francis and Mound never waived the fees.

With the first quarter billing for 2021 to go out on April 25, 2021, staff would like direction from the City Council in regards to whether the waiver of late fees should continue.   

 

15 minutes.

Diana Lund, Finance Director

Give staff direction to continue or discontinue waiver of late fees on utility bills.