HomeMy WebLinkAbout2021-01-21; Utility Billing Late Fee Relief Update; Quiram, VickiTo the members of the:
CITY COUNCIL
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Municipal Water District
Memo ID #2021017
CMWD Board Memorandum
Jan. 21, 2021
To: Carlsbad Municipal Wate
From: Vicki Quiram, General Ma a
Paz Gomez, Deputy City Man
Laura Rocha, Deputy City Ma
Via: Scott Chadwick, Executive Ma a
Re: Utility Billing Late Fee Relief U
This memorandum provides an update on suspension of utility bill late fees during the
COVID-19 state of emergency.
Background
Due to the transition to a new utility billing system, as well as the COVID-19 pandemic state of
emergency, the Executive Manager implemented, and the Carlsbad Municipal Water District
(CMWD) Board of Directors (Board) confirmed on May 5, 2020, temporary relief measures
which included the suspension of late fee assessments on past due utility bills.
The Board also authorized the Executive Manager to extend the temporary relief measures
through June 30, 2020, or the end of the COVID-19 pandemic state of emergency, if necessary.
Since the City of Carlsbad and CMWD are still in a state of emergency, these measures have
remained in place. This memorandum is to update the Board on the fiscal impact of suspending
late fee assessments.
Discussion
The Utilities Billing Division in the City of Carlsbad's Finance Department manages CMWD's
water billings and collections. After the declaration of the COVID-19 pandemic state of
emergency, the Executive Manager implemented, and the Board confirmed on May 5, 2020,
the suspension of potable water shutoffs and late fee charges through the end of the state of
local emergency. Late fees assessed on accounts not paid by the due date are 10% of past due
balance, not to exceed $50. Late fees generated approximately $400,000 in revenue for the
city's utilities in fiscal years 2017-18 and 2018-19.
With the Governor's Executive Order N-42-20 prohibiting the discontinuation of water service
during the COVID-19 emergency, and the suspension of late fees, there is no penalty for
customers who do not pay their utility bill when due. This has resulted in difficulty collecting
outstanding balances and an increase in past due accounts. As of Dec. 1, 2020, there were 408
past due accounts totaling $418,149.
Carlsbad Municipal Water District
5950 El Camino Real I Carlsbad, CA 92008 I 760-438-2722 I 760-431-1601 fax I www.carlsbadca.gov
Board Memo -Utility Billing Late Fee Relief Update
Jan. 21, 2021
Page 2
Neighboring water districts have experienced the same, if not worse, challenges and, as a
result, many districts have reinstated late fees. The summary below shows which neighboring
districts are assessing late fees. Carlsbad continues to mail out past due notices and alert
customers by phone when their account has become over 60 days past due, encouraging them
to pay as much as possible to avoid large balances that will be due in the future.
Water District Assessing Late Fees
Carlsbad
City of Escondido
Elsinore Valley Water
Encinitas X
Helix
Lakeside X
Oceanside X
Olivenhain
Otay X
Padre Dam X
Poway X
Ramona Municipal Water District X
San Dieguito Water District
Santa Fe Irrigation District X
Sweetwater
Vallecitos X
Vista Irrigation District X
Without late fees or shut offs, these past due accounts will continue to grow, and many
customers will be faced with large balances and possible discontinuation of service once the
Governors order is lifted. While the city remains sensitive to the economic impacts resulting
from the COVID-19 pandemic, shelter-in-place orders, and resulting economic impacts,
reinstating late fees may encourage customers to pay their bills.
Next Steps
Staff will return to the Board in March 2021. If the state of emergency has not ended at that
time, staff will bring forward an item at a future City Council Meeting for the Board's
consideration on the reinstatement of late fees. In addition, staff will be providing a separate
update for the Board regarding utility bill financial assistance.
cc: Geoff Patnoe, Assistant City Manager
Celia Brewer, General Counsel
Robby Contreras, Assistant General Counsel
Ryan Green, Finance Director