HomeMy WebLinkAboutFIN-2025-274 - Fee For Paper Billing
Financial Services Department www.kitchener.ca
REPORT TO: Finance and Corporate Services Committee
DATE OF MEETING: June 16, 2025
SUBMITTED BY: Saleh Saleh, Director, Revenue Division, 519-904-6308
PREPARED BY: Saleh Saleh, Director, Revenue Division, 519-904-6308
WARD(S) INVOLVED: ALL
DATE OF REPORT: May 14, 2025
REPORT NO.: FIN-2025-274
SUBJECT: Fee For Paper Billing
RECOMMENDATION:
That -billing promotion efforts (Option #3) through
targeted marketing campaigns to further increase the adoption of paperless billing.
REPORT HIGHLIGHTS:
The purpose of this report is to provide Council with options to reduce postage costs related
to paper billing and promote the -billing platform.
Postage and paper costs continue to rise requiring the City to explore options to reduce or
eliminate paper billing.
The City of Kitchener has one of the highest e-billing adoption rates at approximately 50%
of customers enrolled, when compared to other municipalities around the Province.
This report supports the delivery of core services.
BACKGROUND:
As postage and paper costs continue to rise, the City of Kitchener is committed to exploring
ways to mitigate the increased costs. This includes exploring strategies to further encourage
the use of electronic bill presentment and considering the implementation of a user fee for
receiving paper bills. On January 20, 2025, Council passed the following motion related to the
delivery of paper bills:
sustainability, cost efficiency, and promoting advancement in technology in its operations, and;
-
billing platform for property tax and utility billing, and;
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
WHEREAS Canada Post has notified the City that postage charges will increase by 25%
starting in 2025, which will result in a significant cost increase for both property tax and utility
customers, and;
WHEREAS enrollment on e-billing offers numerous benefits such as reducing paper waste,
lowering costs, and providing customers with a faster, more secure and more convenient
access to their bills, and;
THEREFORE BE IT RESOLVED that the City of Kitchener staff consider the feasibility of
grandfathering existing customers who are currently not enrolled on e-billing and provide options
for council to consider for any new customers who sign up for services with the City, and report
This report provides information and options for consideration as it related to reducing postage
and paper costs.
REPORT:
Current Situation
Canada Post previously announced that postage costs will increase by 25% in 2025. In 2024
the City spent approximately $1M in postage. A large percentage (80%) of the postage budget
relates to costs of mailing out property tax and utility bills. Other paper invoices (20%) that are
mailed out include, collection letters, miscellaneous accounts receivable invoices and other
letters or notices across the organization to customers.
Approximately 50% of our customers and residents have enrolled on e-billing for their utility and
property tax accounts.
On average the cost to mail out one paper bill is equal to approximately $1.50 which includes
postage, an inserting fee and paper. It is expected that this fee will continue to rise as the price
of commodities and inflation increases.
-billing solution by encouraging customers to
enroll on e-billing and have investigated other options to deliver invoices through e-billing such
as:
Mailing of Accounts Receivable invoices to customers who provide an e-mail address.
Promoting e-
Monthly contests with prizes through Kitchener Utilities.
Communication through in-person and telephone interactions.
Inserts in utility and property tax bills.
Current Legislation
The Municipal Act, 2001 (Act), provides guidance to municipalities on methods of delivery
specific to property tax bills. There are a few relevant sections of the Act which relates to mailing
out of property tax bills:
Section 343 (1) of the Act requires the Treasurer to send a tax bill to every taxpayer at
least 21 days before any taxes shown on the bill are due.
residence or
place of business or to the premises in respect of which the taxes are payable.
Section 343 (6.1) allows the Treasurer to send a tax bill to the taxpayer electronically if
the taxpayer has chosen to receive the tax bill in that manner.
Section 343(7) requires that where a taxpayer directs the treasurer in writing to send the
shall add the cost of the registration to the tax roll and the amount shall be deemed to be
part of the taxes for which the tax bill was sent.
The legislation is not clear on whether municipalities may charge a fee for providing a paper tax
bill. Ha
tax bill to every taxpayer, and under section 343 (6.1) taxpayers cannot be forced to receive their
bills electronically.
Staff have reviewed the legislation and are of the opinion that there are requirements outlined in
the Act which require a Treasurer of a municipality to present a bill to a ratepayer. However,
there is no explicit language in the Act which either authorizes or prohibits charging a fee for the
delivery of a paper bill except for section 343(7) above which speaks to the cost associated with
registered mail.
The Act does not include any specific language related to fees for delivery of paper utility bills.
The Ontario Energy Board (OEB) serves as the provincial regulator for gas and electricity utilities
in Ontario. In 2020, the OEB ruled that Enbridge could not charge customers for paper bills or
automatically enroll them in electronic billing when opening a new account. The Kitchener utility
bill includes charges for gas, water, sewer, stormwater, and rental water heaters. While
Kitchener Utilities is not directly rate-
As a result, if the City were to introduce a fee for paper utility bills, it would likely not be consistent
with the OEB decision. Currently, Enbridge promotes e-billing and does not charge a fee for
paper bills.
Survey of Other Municipalities
A survey of other municipalities indicated that currently only two; the City of Quinte West and
Sioux Lookout, charge a fee for mailing of paper property tax and utility bills. The Township of
Wilmot through their 2025 Budget process also approved the implementation of a fee for the
mailing of paper bills.
A survey was also conducted with municipalities to understand whether customers are enrolling
on e-billing or changing their preferences as it relates to paper billing. The results of the survey
are shown in the next table:
Municipality % of Customers % of Customers Fee Charged for
enrolled on e-enrolled on e-Paper Bills
billing (TAX) billing (UTILITY) (Yes/No)
City of Markham33%45%No
City of Mississauga 20% N/A No
City of Waterloo 26% 40% No
City of Cambridge 7% 34% No
City of Kitchener 49% 49% No
City of Guelph 4% N/A No
City of Hamilton 7% N/A No
City of Toronto 10% 12% No
City of London 0% N/A No
City of Ottawa 46% 49% No
The survey results demonstrate that the majority of municipalities do not currently charge a fee
for mailing paper property tax and utility bills. Furthermore, e-billing adoption rates for the City
of Kitchener are the highest when compared to other municipalities.
Other considerations
As the City explores implementing a paper billing fee for new utility customers, it is important to
evaluate the policy to ensure fair and accessible service delivery for all residents.
While encouraging digital billing aligns with environmental and fiscal goals, the City
must recognize and address potential barriers that could disproportionately impact specific
communities.
There are a few considerations for Council to be aware of as it relates to these factors:
Digital Access and Affordability- Low-income households and seniors for example may
not have regular access to computers or smartphones, affordable internet or may not
have the digital literacy or comfort with online systems. A fee for paper bills could
unintentionally penalize customers who are unable to transition to e-billing due to
systemic barriers.
Seniors and Technological Comfort- Older adults may be less comfortable navigating
digital billing platforms or may prefer the familiarity of paper bills as a method of account
management. Charging a fee for paper bills to this demographic may be viewed as
exclusionary or insensitive to aging populations.
Customers with Disabilities- -billing platform meets the
requirements of the Accessibility for Ontarians with Disabilities Act, customers with
cognitive, visual, or other impairments may still face challenges in using digital billing
platforms.
Newcomers to Canada- Customers who are new to Canada and speak English as a
second language may also be impacted if they cannot afford the costs of paper bills and
may also have difficulty navigating an online system which is in English.
Any proposed approach to implementing a paper billing fee must be developed with careful
attention to the equity and accessibility concerns outlined above. It is crucial that the City
consider these factors to avoid creating unintended hardship for residents.
Options
It is expected that increased postage costs and the threat of postal service disruptions will
continue to be a factor due to inflation and labour uncertainty. Staff have developed three
Option #1: Charge $2 for Every Paper Bill to Be Mailed Out
This option considers charging customers $2 for every paper bill that is mailed out. By
introducing a direct cost to customers who choose to continue receiving paper bills, the City
can reduce its operating expenses while encouraging greater adoption of the free, more
efficient e-billing platform.
Advantages of this option includes recovery of postage charges, additional revenue for the
utility base and a benefit to the environment. It would likely also accelerate the transition to
environmental sustainability goals by reducing paper consumption and greenhouse gas
emissions associated with mail delivery.
A major disadvantage of this option is the increased cost to the customer for receiving a paper
bill and especially on customers who prefer to rely on paper billing such as seniors, residents
without regular internet access, or those unfamiliar with online billing systems. This fee will not
be consisted with previous OEB decisions related to a fee for paper billing. Further, the Act
may also limit the ability of the City to charge a fee on property tax bills.
Staff are aware of the following municipalities who are charging for paper bills or are moving
towards charging a fee to deliver a paper bill to their customers:
Municipality Fee per bill Property Tax and Utilities Population
(Approx)
City of Quinte West $1.50 Utility Bills only 50,000
Sioux Lookout $3.00 Property Tax and Utility Bills 6,000
Township of Wilmot $2.50 Approved during the 2025 22,000
Budget deliberations
Note: These municipalities apply the fee exclusively to water utility bills, as they do not offer
gas services and are not subject to OEB rulings.
Conclusion: Introducing a $2 fee for each mailed paper bill presents a practical way for the City
to recover increasing postage and other costs, while also promoting broader adoption of the
-billing service. This approach supports environmental objectives and long-term
operational efficiency by reducing reliance on paper-based communication.
However, while financially and environmentally beneficial, this option may disproportionately
impact vulnerable populations; particularly seniors, low-income residents, and those with limited
digital access or literacy. To ensure fairness and accessibility, any implementation of this fee
should be accompanied by a well-defined exemption process for those facing systemic or
financial barriers.
The authority for the City to impose a fee for paper billing is uncertain. Additionally, charging a
Option #2: Grandfather existing customers on paper billing and charge new customers a fee for paper
bills starting on January 1, 2026
meaning they could continue receiving paper statements without incurring any additional fees.
However, beginning January 1, 2026, any new customers establishing utility accounts or existing
customers changing account ownership or creating new service addresses, would be required
to pay a monthly fee if they choose to receive a paper bill rather than opting into e-billing.
The paper billing fee would be designed to cover the actual costs of printing, mailing, and
processing paper bills, and would serve both as a cost recovery mechanism and a financial
incentive for customers to choose digital billing. This approach also aligns with the City's
environmental goals by promoting reduced paper consumption and lower carbon emissions.
Over time, as new customers opt for e-billing or accept the paper fee, the number of paper bill
recipients is expected to decline, resulting in long-term cost savings and improved operational
efficiency. One potential drawback of this approach is that it does not directly incentivize
current paper bill users to switch to digital billing, which may slow the pace of overall e-billing
adoption. It also requires changes to the billing system to track account status and apply the
fee accurately. This fee will not be consistent with previous OEB decisions related to a fee for
paper billing. The Act may also limit the ability of the City to charge a fee on property tax bills.
Should Council choose to proceed with this option, a clearly defined exemption policy would be
necessary to address barriers related to equity and accessibility, ensuring customers with
financial hardship, limited digital access, or accessibility needs are not unfairly impacted.
Conclusion: Over time, as more customers enroll in e-billing, the City will benefit from reduced
mailing costs, lower carbon emissions, and improved service delivery. Additionally, this
approach acknowledges the needs of current residents, avoiding abrupt changes that could
cause customer dissatisfaction.
The authority for the City to impose a fee for paper billing is uncertain. Additionally, charging a
fee
Option #3: Enhance Promotion of E-Billing Through Targeted Marketing Campaigns
-billing program
by implementing strategic marketing initiatives. These initiatives would include redesigned bill
inserts, dedicated social media outreach, email campaigns, and increased engagement with
customers about the benefits of e-billing; both during in-person interactions at service counters
and on the phone. The marketing campaign would emphasize the core benefits of e-billing:
Convenience 24/7 access to billing information from any device
Security Reduced risk of mail theft or lost bills
Environmental sustainability Lower paper usage and carbon footprint
Efficiency Faster bill delivery and easier account management
The primary benefits of this approach include a reduction in postage and paper costs, improved
operational efficiency, and enhanced customer satisfaction through digital self-service options.
-billing infrastructure also ensures that the transition can be
supported without major system overhauls.
A key challenge with this option is the gradual nature of customer adoption. As the City already
has a relatively high percentage of residents enrolled in e-billing compared to other
municipalities, further growth may be incremental. Further, the continued rise in postage costs
poses a financial pressure which will result in higher property tax and utility rate increases.
Conclusion: A proactive marketing campaign to promote e-billing offers a cost-effective path to
long-term savings and sustainability. While growth in adoption may be gradual, the cumulative
benefits; financial, operational, and environmental, make this an essential strategy for
This option aligns with past OEB decisions on paper billing fees and does not appear to conflict
with any provisions of the Act applicable to the City.
Recommendation
Staff recommend proceeding with Option #3: Enhanced Promotion of E-Billing Through
Targeted Marketing Campaigns. This option offers a balanced approach that aligns with the
environmental sustainability goals and long-term cost containment strategy while
remaining sensitive to the diverse needs of residents. Unlike the other options, this approach
avoids creating new financial barriers for vulnerable or equity-deserving groups, such as low-
income residents, seniors, newcomers, and individuals with disabilities.
To maximize the impact of Option #3, staff will develop and launch a multi-channel
communications strategy. Examples include:
Offering incentives such as contests or bill credits to encourage participation
Inserts in utility and property tax bills
Targeted social media ads and video content
Outreach via local community groups, senior centres, and newcomer organizations
In-person and telephone support for residents needing help enrolling in e-billing
Possible translation of promotional and instructional materials into commonly spoken
languages in the City
Option #3 is the most inclusive, fiscally responsible, and environmentally sustainable option
-billing adoption while ensuring no resident is
unfairly penalized for circumstances beyond their control. A strengthened marketing campaign,
combined with monitoring and future flexibility, positions the City to modernize service delivery
thoughtfully and equitably.
The recommended Option #3 aligns with the OEB decision related to not charging a fee
for a paper bill and does not appear to conflict with any provisions of the Act regarding the
STRATEGIC PLAN ALIGNMENT:
This report supports the delivery of core services.
FINANCIAL IMPLICATIONS:
Capital Budget The recommendation has no impact on the Capital Budget.
Operating Budget The recommendation has minimal impact on the Operating Budget. Any
expenditures related to the promotion of e-billing will be recovered through decreased postage
and other costs.
COMMUNITY ENGAGEMENT:
INFORM
council / committee meeting.
Community engagement also included outreach to peer municipalities, review of customer
behaviors, and an internal analysis through an equity and accessibility lens.
PREVIOUS REPORTS/AUTHORITIES:
There are no previous reports/authorities related to this matter.
FCS-14-095- Postage Rate Increase
Municipal Act, 2001
Ontario Energy Board
APPROVED BY: Jonathan Lautenbach, CFO, General Manager of Financial Services
ATTACHMENTS: None