Delinquent sewer accounts shoot up after policy change

Delinquent sewer accounts shoot up after policy change

October 18, 2001

By Gail Binkly
Journal Managing Editor

The Cortez Sanitation District board expressed dismay Tuesday night over an increase in the number of delinquent accounts that has occurred since the board backed away from sewer-line cut-offs.

District Manager Bill Smith said approximately $14,000, or 1.6 percent of the district’s revenue stream, is delinquent, but only around $1,400 of that amount is lienable this year.

Under state law, he said, an account must have at least $150 past due for at least six months before the customer’s property can be liened. Most of the accounts do not meet that criterion, he said.

Six months ago, the total amount in arrears to the district was only about $1,500, said board member Jim Bridgewater. "Now that’s increased tenfold," he said.

"By next year that amount will probably be closer to $40,000," predicted Smith.

Most of the delinquent customers are repeat offenders, the board said, looking at the list.

The board’s old policy was that if an account had any amount in arrears for six months or more, the customer had to bring the amount current or face a possible sewer-line disconnection. The fee to be reconnected was $500 the first time, $4,000 for subsequent cut-offs.

The board took considerable flak this year for that longtime policy. In March, a Cortez woman’s service was cut off after she had sent a partial payment to the district and explained in a note that her husband had had a stroke and required brain surgery, and that she’d fallen behind in her payments.

The incident drew statewide attention and was partially responsible for prompting a recall election against three of the five board members: Bridgewater, Sam Jarvis and board President Stan Pierce.

In July, the board voted 4-1, with Pierce dissenting, to try using liens instead of disconnections.

The district’s liens are certified and sent to the county treasurer’s office in October to be placed on the delinquent customers’ January property-tax bills. The money is collected by the county along with the property taxes. If the customer doesn’t pay his taxes, the property is sold and the district collects its money then.

A 10 percent surcharge is added to the overdue amount to cover interest and fees, and additional money can be added for costs of sending certified letters and other charges. The treasurer’s office can also add fees for its costs.

But Smith said, even though the district will eventually get its money back with interest, having too much money owed to it causes problems.

"The district had a similar experience the last time they went down this lien-process road (in the early 1990s)," he said Wednesday. "It got to be where there was $40,000, $50,000 hanging out there, and it kind of messes with your operating budget."

In other business Tuesday, the board:

• Scheduled a public hearing at its next meeting Nov. 20 on its proposed budget for 2002. The budget is essentially the same as last year’s, according to Smith.

The budget is divided into two categories: the enterprise fund, which handles operations and maintenance; and the governmental fund, which is used to construct sewers and plants. Total revenues in the enterprise fund are projected at $1.09 million and expenditures at $1 million, according to Smith. Revenues are expected to decline slightly from this year’s because of falling interest rates and an expected decrease in sewer-tap sales.

The governmental fund includes the general fund, which is where property-tax revenues go, Smith explained, and the capital-projects fund, which is for sewer-plant construction. The general fund’s projected revenues are $845,691, he said, and expenditures are $804,460. The capital-projects fund has projected revenues and expenditures of $2,383,000, both for the new sewer plant, Smith said.

• Gave informal approval to a proposal by Lakeside Mobile Home Park near Totten Lake to tap into the sewer system.

The owners of the park, which has been plagued by sewer woes for years, have been ordered by the county to come up with a permanent solution to the sewage problems. Two engineers recently told the county commissioners they’ve prepared a plan that would fix the wastewater-treatment system for the 66 homes at the park for an interim period, while the park’s owners raise the funds to tap into the sanitation district’s system.

"The alternative they have chosen is for them to connect to us, which gets them out of the sewer business," Smith said, "which is what they want and I think what the state wants."

He said the owners probably will be seeking 114 taps in 2003.

The board members agreed they supported the concept, but said they could not guarantee anything at this point.

• Tabled a request by Kenneth Baxstrom that two old sewer taps on property at North Market Street be recognized by the district. "If you’ve got a pipe fastened to a commode and it goes to the sewer then you ought to have a sewer tap," Baxstrom argued.

The sanitation district’s policy is that a sewer tap must have been used in the past 10 years, or the property owner has to purchase a new one for $4,000. Proof of use could be either a receipt for the purchase of the tap within the past 10 years, or receipts showing that sewer service had been paid for within the last decade.

The reason for the policy, the board said, was that people had been coming to the board claiming they had paid for sewer taps decades ago, even before the sanitation district existed. "It got to the point where it was nothing short of asinine, the requests we were getting," said Bridgewater.

But Bridgewater said he would like Smith to check with attorney Kent Williamson to make sure the district is within its rights to consider taps abandoned after 10 years.

• Voted 4-0 to approve a request by Jim Kreutzer, developer of the Southern Bluffs subdivision, to release him from a portion of the letter of credit he gave at the start of the project. The development is about 42 percent completed, Smith said, and the board decided to release 85 percent of the amount he paid on 42 percent of the project, for a total of $58,876.