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EC: $1.8M still owed on utility bills

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By Jon Hawley
Staff Writer

Sunday, November 19, 2017

Elizabeth City is chipping away at roughly $1.8 million owed in back utility bills, despite dozens of customers already defaulting on payment plans they got this summer.

The city wrestled with utility problems earlier this year that caused delayed bills, prompting city officials to offer customers payment plans to pay off large back balances. In his latest report to the city council on Monday, City Manager Rich Olson reported that 97 customers have finished their payment plans and, after paying about $36,000 in back bills, are current on their accounts again.

However, he also reported this week that 65 customers have defaulted on the payment plans, been disconnected and sent final bills for their full balances. In an interview Saturday, he roughly estimated the customers had defaulted on $60,000 worth of back bills. The city will attempt to collect the debts, including through a debt collection agency, he noted.

Subtracting the customers who've paid off their plans, plus the ones who defaulted, the city still has more than 2,000 active payment plans worth about $1.8 million, Olson also reported.

Councilors Johnnie Walton and Tony Stimatz both had concerns with Olson's report during the council meeting.

Walton said the city appeared to be “pushing people out” due to its utility problems. Walton and other councilors have warned that some customers can barely afford their normal utility bills, let alone the additional amounts that payment plans require monthly.

Olson told Walton during the meeting that the defaulted customers didn't seek extensions on their bills' due dates or otherwise ask the city for flexibility. They likely left the area, he said.

After further research, Olson reported in a memo Friday that, of the 65 customers who defaulted and haven't tried to continue utility service, 31 of them were “chronic slow-payers” who had billing troubles even before the city's problems this year.

Asked if the city's billing problems helped cause the other 34 customers' defaults, Olson said it's hard to tell.

Stimatz expressed concerns with how the city is monitoring the payment plans. The city's electrical fund balance was once close to $10 million, but can't get back to that number without the payment plans being paid off, he claimed.

Following the meeting, Olson said it wasn't clear to him how Stimatz arrived at that number. It's not reflected in the city's pending 2016-2017 audit, he said. Olson also reported that the city's electrical balance was $6.82 million, as of Oct. 27, and he expects it to be in excess of $8 million by June 30, the end of the current fiscal year. That's in keeping with a target council set, he said.

Asked if the outstanding balance of $1.8 million would limit the city's utility projects next year, Olson said he didn't expect it to impact the electrical utility, but it might slow the implementation of “smart grid” infrastructure for the water system. Olson noted that 60 percent of the $1.8 million was owed to the electrical utility, followed by about 30 percent owed to the water-sewer system and the rest to the city's solid waste fund.

Stimatz also asked for regular updates on how much has been paid off on the city's bills. Olson asked to only provide those updates monthly. City staff have to manually review binders of agreements to get those numbers, making the work time-consuming, he explained.

Stimatz accepted monthly reporting, but said it was bad business to not track the agreements by computer.

Olson agreed, but said the city's current billing software, provided through Logics, doesn't allow the city to track the agreements digitally.

In another utility update, Olson said he had postponed – with council's consent – a presentation on potentially converting to a new utility billing software. The city is considering two new platforms for billing software, one offered through NorthStar Utilities Solutions and another through Tyler Technologies.

Olson said the city has had meetings with NorthStar so far, but won't be able to meet with Tyler until next month. Olson also said Tyler has yet to submit a formal proposal to the city, but he's expecting it to ask for less money than NorthStar.

NorthStar issued a proposal earlier this month that would charge about $386,000 for implementing a new billing system. Though NorthStar is asking for more money, Olson also described its system as more “robust” and prepared for the future. It would allow customized billing dates and email/text notifications to customers, two features the council has called for. Tyler would also allow those, but to a more limited extent, Olson said.

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