Town council approved the writeoff of $27,308.68 in doubtful utility accounts at the regular meeting of May 9.
The action was requested by administration to keep accounts receivable as accurate as possible. The uncollected debts relate to renters who left town without paying off their accounts.
While a bylaw was passed in 2010 to stop the practice of putting utility accounts in renters' names, grandfathered accounts are still being written off as the renters leave town without paying their bills.
A total of $96.33 related to accounts that were closed in 2002, $1,448 related to accounts closed in 2008, $10,918 related to 2009 and $14,546 related to accounts closed in 2010. All of those accounts had previously been sent to the Optimum Credit Recovery in January, but it was deemed doubtful that any of that money would be recovered. If any is recovered, it will be credited to the town's recovery of bad debts account. The amount that was written off related to 114 accounts.
“Obviously we want to keep our books in line with what our true receivables are and so if these previous utility renters have departed from the area and we can't trace them, then we send it off to collections. And to this point in time, we've sent off 703 accounts to collections. These are people that have left the area that didn't pay their bill,” said Cliff McDonald, the town's director of corporate services.
McDonald said because the bylaw didn't allow for all utility accounts to be converted into owners' names, there are still renters in town paying utility accounts.
“It's gonna take time, based on the way the bylaw was constructed, (to convert all the accounts),” he said, noting there are still 364 residential utility accounts in renters' names, and an additional 158 commercial accounts in renters' names.
“The expectation from the town is that when those people turn over their property, they will pay their final utility bill,” McDonald said.
The town has now instituted a policy in which remaining renters have 30 days after utility accounts have closed to pay their bill. After that time, the account is sent to Optimum Credit Recovery.
The town has written off $168,000 in delinquent utility accounts in the last two years.
"The expectation from the town is that when those people turn over their property, they will pay their final utility bill."Cliff McDonald, director, corporate services, Town of Olds
