City sees drop in unpaid utility accounts

Twice a year, the members of the Statesville City Council are asked to approve writing off thousands of dollars in uncollectable delinquent utility accounts.

With the difficult economy, those accounts add up to more than $280,000 annually. So when the write-offs for the council’s Dec. 3 meeting came in at $35,000, it raised some eyebrows.

Did the big drop in write-offs signal an improving economy? Had the city changed its methodology? Neither, according to Finance Director Lisa Salmon. It’s all due to the city changing collection agencies.

“The old agency’s contract ended, and the new agency wasn’t in place yet to work delinquent accounts during the write-off period of January to June 2011,” she said. “Therefore, we decided to give the new agency a chance to work the accounts before we write them off.”

The city provides electricity and water and sewer service to a majority of its residents and businesses. The firm that the city dropped is Online Collections in Winterville. Statesville used it for 15 years but decided in 2011 to change to Interstate Credit Collections based in Winston-Salem. Neither firm is accredited by the Better Business Bureau, but both carry high BBB ratings of between B+ and A+.

After a brief discussion, the council unanimously approved the write-off.

“In terms of dollars, this write-off is a lot of money,” said Mayor Costi Kutteh. “However, you need to remember that it represents just a fraction of 1 percent of the revenues we receive annually from our utility customers.”

Although the payments are written off, they will remain in the city’s computer system for three years, should payment finally be received or the account holder wants to re-establish utility services with the city.

Also at the Dec. 3 meeting, the council:

• Denied a request by the developers of a new Dollar General Store to annex a 1.4-acre parcel in the northwest portion of Statesville. The council members took exception to the owner’s plans to build a septic tank at the site. However, the council agreed to let City Attorney Edward Gaines negotiate a contract with the property owners in which they would agree to connect to the city’s sewer system upon its availability at that site.

• Adopted a 2013 meeting schedule that calls for a one-day planning retreat Feb. 28 at the Statesville Civic Center, rather than the traditional two-day session.