City tries new ways to collect past-due bills
Dec. 3—The city of St. Joseph often struggles to collect past-due bills, which is why it's working to make the process more effective with some new techniques.
The largest collection of bills the city handles are sewer bills. Typically they are sent out nine times a month to different groups. When those bills aren't paid, the city sends out warning letters and calls the customer. If the bill still goes unpaid, a notice is sent that Missouri American Water will be shutting off service.
But this wasn't always the process. Over the last 10 years, the city used to rely on collection agencies to collect past due bills, but that technique was tedious and inevitably cost the city even more money.
"We've gone through an analysis of the effectiveness of the outside collection agencies and determined that it's likely costing us more money to have their services than what they're recovering for us, so we've moved away from it," said St. Joseph City Manager Bryan Carter.
Instead, the city has moved the collection process in-house.
"We have a little bit better focus on each account and an effort to collect that account," Carter said. "The overall numbers don't change dramatically. When the bills are not paid, it's still going to not be paid, but we've had a little more effectiveness."
More than 1,394 accounts, totaling $275,684, have sewer bills due Dec. 2. Of the total amount due, a little less than half — $116,473 — is from accounts that have been 60 days past due and will receive a shut-off notice if they don't pay.
Since turning away from the collection agencies, Carter said the threat of shutting off services has a significant effect on people paying their bills. The city has also turned to lawsuits, however it's an expensive process, so the amount due has to be enough to cover the cost.
"You can end up spending a whole lot of resources to collect what's a large amount of money, but not necessarily enough money to justify the resources spent," Carter said.
The low rate of collections has an effect on the city's bottom line, but Carter said it's a steady number that is easy to predict year to year, which helps the city anticipate it in their budget.
"It does make a large difference on the city's bottom line," he said. "However, that difference is pretty predictable. It stays level across years, so over the course of several years, we can build in an estimation for the sewer bills and other revenue sources that we just won't receive."
State programs that help low-income residents pay utility bills, like the Low Income Household Water Assistance Program, have helped decrease past-due bills. The same can be said for the city's automated online payment method, which Carter recommends residents use to make the process more streamlined for customers and the city.
Quinn Ritzdorf can be reached at quinn.ritzdorf@newspressnow.com
