HomeMy WebLinkAboutFIN-2023-033 - Uncollectable Utility Receivable Account Write-Off December 2022
Financial Services Department www.kitchener.ca
REPORT TO: Community and Infrastructure Services Committee
DATE OF MEETING: March 6, 2023
SUBMITTED BY: Saleh Saleh, Director, Revenue, 519-741-2200 ext. 7346
PREPARED BY: Marcy Ignor, Manager Utility billing and Customer Service, 519-741-
2200ext 7460
WARD(S) INVOLVED: ALL
DATE OF REPORT: January 6, 2023
REPORT NO.: FIN-2023-033
SUBJECT: Uncollectable Utility Receivable Account Write-Off December 2022
RECOMMENDATION:
That uncollectable utility accounts amounting to $80,371 be written off against the
allowance for doubtful utility receivables.
REPORT HIGHLIGHTS:
As per council policy, approval from Council is required for accounts to be written-off and
sent to an outside collection agency for third party collection efforts.
Staff have worked diligently in attempting to collect on these accounts but have not been
successful in the process.
This report recommends that accounts totalling $80,371 be written off and forwarded to an
outside collection agency.
BACKGROUND:
As per council policy FIN-FEE-517 Utility and Miscellaneous Receivable policy, approval from
Council is required for accounts to be written-off and sent to an outside collection agency for
third party collection efforts.
Utilities receivable represent invoices generally billed through th
System. The majority of these invoices relate to usage for Gas and Water. The current report
represents write-off of utility accounts which have been deemed to be uncollectable up to the
end of December 31, 2022.
REPORT:
Staff are recommending that accounts totalling $80,371 be written off and forwarded to the
collection agency. Staff have worked diligently in attempting to collect on these accounts but
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
have not been successful either due to the customer declaring bankruptcy or having no
forwarding address. Any tenant deposits previously received on theuncollectable accounts
have been applied to reduce the debt outstanding. A total of 162 customer accounts are being
recommended to be written off and transferred to a third-party collection agency.
The collection procedures staff have undertaken include:
Sending customers statements and demand letters.
Verbal request by telephone or in person.
Negotiating revised payment terms.
Applying any deposits held to the outstanding amounts.
by the Municipal Act.
The cumulative amount of utility write-offs identified in this report equal $80,371 and relate to the
years 2020, 2021 and 2022. The cumulative write-offs are shown in the table below and the
average is well below the targeted upper limit for write-offs set at 0.3% previously approved by
Council.
A five-year summary of write-offs is included in the table below.
Utility Accounts Write-off
CumulativeTotal $ InvoicedWrite-offs as a
Write-offs for the YearYear to Date% of Sales
2022 101,429 $ 233,620,5920.0434%
2021$ 156,012$ 216,217,8050.0722%
2020$ 219,812$ 213,604,9760.1029%
2019$ 216,675$ 202,658,0950.1069%
2018$ 261,616$ 211,483,2090.1237%
Total$ 955,544$ 1,077,584,6770.0887%
STRATEGIC PLAN ALIGNMENT:
the delivery of core service.
FINANCIAL IMPLICATIONS:
.
The uncollectable accounts will be written off against the Allowance for Doubtful Utility
Receivables account.
COMMUNITY ENGAGEMENT:
INFORM
council / committee meeting.
PREVIOUS REPORTS/AUTHORITIES:
FIN-FEE-517 Collections- Utility and Miscellaneous Receivable
APPROVED BY: Jonathan Lautenbach, Chief Financial Officer, Financial Services