Page 54 - Board Meeting Material

Director Memorandum 14-037 Date: May 21, 2014 Prepared By: Peggy Little, Administration Supervisor Subject: Identification and Declaration of Bad Debts for Calendar Year 2012 Recommendation: That the Board authorizes the District staff to declare bad debts for calendar year 2012 in the amount of $31,480.50. The District actively pursues delinquent accounts, and in most cases is able to collect delinquent fees through a combination of shutting off the services provided, sending accounts to a collection agency, placing a lien on the property involved, and/or pursuing the claims through legal actions such as small claims court. In some cases, the District is unable to collect the money owed the District. Included in this amount of $31,480.50 is an uncollectible miscellaneous invoice that totals $521.56. This uncollectible invoice is a result of an accident that broke a fire hydrant. During the calendar year 2012, we continued to experience foreclosures. The amount of foreclosures is $13,706.05 which includes $2,718.00 sewer only customers and $10,988.05 water/sewer customers. This leaves account balances of $17,252.89 that was not collected in the normal process. As a proper accounting Bad Debt as a Percentage of procedure, this bad debt must be Annual Water and Sewer Revenues accounted for on our financial 0.300% statements; otherwise the debt 0.270% remains as a liability on the 0.240% District’s annual audit. 0.250% 0.230% 0.230% District staff has compiled the list 0.190% of uncollectible accounts for 0.200% calendar year 2012, which 0.160% amounts to $31,480.50. Of this total, 44% of the bad debts are 0.150% 0.120% 0.120% due to home foreclosures, and this trend will hopefully continue to decline for calendar year 0.100% 0.073% 0.065% 2013. 0.055% 0.053% 0.047% 0.049% 0.034% Overall, the total amount of bad 0.050% debt represents a loss of 0.16% for calendar year 2012 based on 0.000% total water and sewer revenues. 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Yucaipa Valley Water District Board Meeting - May 21, 2014 - Page 52 of 119