No good thing lasts forever — including the City of Fulton's suspension of utility late fees and cut-offs.
During Tuesday night's City Council meeting, council members discussed the plans to resume utility disconnections and penalties. No payment deadline has been set. According to city officials, nonpayments by city residents are taking a financial toll.
"I wanted to keep the council aware that these changes are having a real cost to the city," Fulton Director of Administration Bill Johnson said. "One of the questions I have is, 'How long is this going to last?' When are we going to say everyone has to resume paying?"
Fulton announced its decision to suspend utilities disconnections, utility-related penalties and utility payment credit card fees in mid-March, following in the footsteps of many other Missouri cities. Given the skyrocketing unemployment rates and widespread furloughs and hour reductions, the city wanted to make sure families that couldn't afford both utilities and other necessities didn't have to make that choice.
"Unemployment is pushing 14.7 percent," Johnson said. "The intent was to allow them to use the money coming into their home to pay for (necessities)."
The suspensions were extended and have continued ever since. The balance for customers who haven't paid their bills has been accumulating, too.
Fulton Chief Financial Officer Kathy Holschlag said the suspensions have resulted in significant lost revenue for the city. If shut-offs were this week, 385 accounts would be subject to disconnection for failing to pay a total of $147,000 in bills. In an average month, 50 accounts are shut off due to nonpayment of around $22,000 in total.
That's money the city expects to recoup eventually, but revenue from the suspended service fees, penalty fees and credit card waivers has evaporated entirely. The estimated loss of penalty revenue for March, April and May totals $52,000; service fees $15,000; and credit card fees $6,000.
"Many, many, many of the people who are behind, are behind by a couple of months," Holschlag said. "We need to take a long, hard look at that."
In pre-pandemic times, utility customers had until the 15th of the month to pay their bills. Past that, they faced a 10 percent late penalty. Shut-offs began on or after the 25th of the month. Holschlag said customers facing financial difficulties could work out a plan with the city in which they paid half of the past-due balance up front and the rest was divided among their next three bills.
"In this situation, they're going to be three or four months behind," Johnson said. "Three months to repay that might not be reasonable."
And in order to get on a payment plan, customers need to contact the city before the cut-off date — something, Holschlag said, no customer currently behind on payments has yet done.
"We have a number of customers who just don't pay until the day before shut-off," she added.
The City Council asked Holschlag and Johnson to prepare a proposal for resuming utility payments and penalties, including a payment plan for customers who are behind. Ward 1's Ballard Simmons suggested extending the number of months customers have to catch up on payments.
"There are going to be people out there who owe a lot of money," Simmons said.
Ward 2's Mary Rehklau and Jeff Stone both suggested a deadline sometime in June.
"It gives them a chance to say, 'I gotta budget, I gotta make arrangements,'" Rehklau said.
John Braun, Ward 3, resisted setting such an early deadline, especially given how many people in the community are currently out of work with little money to spare.
"Today is May 12, which leaves 18 days until June," he said. "We have to give people a chance."
Holschlag and Johnson will share their proposed plans with the council at the next meeting, set for May 19. Any decision made by the council will be publicized through the newspaper, fultonmo.org and social media.