WM utility write-offs down below national average
City sees lowest percentage of unpaid bills in years fol-lowing effort to curb losses
At its July meeting, the West Memphis Utility Commission had an opportunity to review data revealing the city’s smallest percentage of uncollected bill write-offs in more than a decade.
The bad debt peaked in 2014 at $807,000. The latest data, which covered unpaid bills from 2016, came in at $255,000 in overdue bills and accounts long in arrears. West Memphis Utility Department General Manager Todd Pedersen presented the quarter-million- dollar figure to commissioners for consideration earlier this month.
“That’s less than one percent of our gross revenue,” said Pedersen “and that’s the national benchmark standard.”
While the half-million dollars in uncollected debt was impressive, Pedersen told commissioners not to expect continued massive drops in write-offs.
“That was a big number, but from here on it will flatten out,” he said.
“We’ve picked all the low hanging fruit.”
The leading indicator for future bad debt looked healthy, too.
“Our ‘over 90 days past due’ is almost nothing right now,” said Pedersen.
Most of the remaining bad debt came from those that had moved away still owing the city money.
Pedersen attributed the recent improved bill paying rate to efforts across the utility company. All departments chipped in to help with mass shutoffs which peak after hot temperature streaks or cold snaps end.
The general manager lauded the teamwork of the entire company and said the utility office will pull departments together to staff for mass shut-offs after extreme temperatures no longer prohibit disconnections.
“We can not cut off if it’s hotter than 95 degrees, or colder than 32,” said Pedersen. “That follows the Public Service Commission guidelines. There are customers that know that and wait to pay until they think we are coming to shut them off.”
Quicker shutoffs resulted after Pedersen’s predecessor, the retired John Rimmer, created a position devoted exclusively to disconnecting and reconnecting services. Disconnecting sooner has prevented over- whelming bills that seem insurmountably hopeless to some customers and has driven down the bad debt at the utility. One position in particular helped stop the losses.
“Shut-offs had always been fit in around other work,” said Pedersen.
“Now, it’s one person’s responsibility on a daily basis to be out there diligently.”
City Councilman Wayne Croom asked if all the old bills must be paid up for the same customer to get service at another address.
There is no credit check taken to determine risk and assign a deposit rate. All residential deposits are a flat $100, but a customer has to pay all back bills to get utility service again, even if they’ve moved.
Commissioner Susan Marshall said old bills must be paid up for the same customer to get new utility service elsewhere in the city.
“We don’t forgive their debt,” said Marshall, “We are just writing it off our books.”
By John Rech