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Lathrop stuck with $35,172 in utility debt

Last year the City of Lathrop wrote off $21,076 in utility bills that were deemed “uncollectable” after going through the normal series of steps to collect the money owed.

While it was a marked decrease from the previous year’s write-off – a standard accounting practice and a required step in the financial auditing process that the city goes through – last week the Lathrop City Council learned that it wouldn’t be a trend that continued.

The 179 utility customers last year that failed to pay their bills to the city – both residential and commercial – racked up $35,172 in debt for a nearly 67 percent increase over the year before. When combined with miscellaneous customers, that number grew to $44,111.

So far, the collection agency that has been contracted by the city to recuperate outstanding debts on these accounts has only returned $286, although collection efforts will continue even though the city has written them off of their books. Golden State Collections, the merchant that the city has used since 2010 to try and recover outstanding debts, retains 30 percent of all of the debts that have been collected.

According to the staff report prepared for the council – who ultimately approved the write-off – the city’s process is to first attempt to collect outstanding fees from delinquent accounts, and those that reach either 60 or 90 days past due can be referred to the collection agency. By that point the city has already cutoff service to the account holder.

The delinquent accounts that were included in the final annual write-off includes some of the accounts that the city extends a grace period to during the month of December so that everybody in the community can have essential city services during the holidays – at a cost of more than $7,000 last year to taxpayers. The council has authorized the extension of the city’s grace period during the month of December every year since 1996 as a sign of goodwill to residents.

Lathrop currently allows customers a 60-day grace period as long as their account is caught up the following month. Once it reaches a 90-day point, and the payment has still not been made – and a payment plan has not been set-up with the city’s finance department – those accounts are typically disconnected from the city’s services.

While water and sewer fees typically comprise the bulk of the outstanding collections that are written off, other city fees like animal services, parks and recreation fees and charges from individual city departments for a variety of different things are included in the annual clearing process.

To contact reporter Jason Campbell email or call 209.249.3544.