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� �i` D�EN��HILLS MEMORANDUM DATE: November 21, 2011 TO: Honorable Mayor and City Council Members Patrick Klaers, City Administrator FROM: Sue Iverson, Director of Finance and Administrative Services Pang Silseth, Accounting Clerk SUBJECT: Utility Ordinance Update Back�round In response to the economic trends, bankruptcies and foreclosures, and cost efficiency, staff suggests updating our utility ordinance in the following areas: Responsible party for payment on utility accounts change to property owner. The City certifies delinquent utilities to property taxes regardless of whether the delinquent balance is from an account in the name of the tenant or owner. There is concern with the legality of this past practice. Requiring that the property owner be the responsible party for the utility account eliminates any question as to the owner's knowledge of and if the owner is responsible for the delinquent balance. According to the League of Minnesota Cities, this arrangement is acceptable by the courts. Also, making a property owner responsible for utility charges helps ensure payment and may decrease the number of delinquent accounts. Certification of delinquent utilities to property taxes on a quarterly basis. The City currently certifies delinquent utilities on an annual basis. This leaves the City more vulnerable to bankruptcy petitions filed prior to certification. Certifying on a more frequent basis protects the City from having accounts that carry larger delinquent balances thereby minimizing the risk. Amounts added to the tax roll continue to be collectable as they not eligible for discharge. Actual calendar quarter billing of residential water and sewer accounts. Currently, residential utility accounts are billed on a rolling billing quarter where one third of the city is billed each month. Staff suggests continuing to bill residential accounts on a quarterly basis, but billing all residential accounts all the same time. This change will be from a rolling billing quarter to a calendar quarter billing cycle. Moving to this proposed billing will be a cost savings in staff time, about two days of finance staff time and three days of public works time during the months in between billings for other projects.