Overdue water and wastewater bills have almost doubled in the last year in the Town of Collingwood.
Treasurer Monica Quinlan told council during a meeting on Monday (June 7) the water and wastewater arrears amount to just over $230,000, up from $130,000 at the end of 2019.
Quinlan said the accumulation of arrears began escalating in 2017.
The town’s water and wastewater billing is handled by Epcor as part of the monthly bills including electricity. The Ontario Energy Board prohibits disconnection of service between November and April.
Any minimum payments made after April are applied to hydro charges first, “leaving water and wastewater arrears to increase.”
The town was working with Epcor to collect the arrears by sending letters to owners of the properties, and in the cases of rentals, both the owner and the tenants received a letter with the arrears balance listed.
Quinlan reported there were concerns raised about this approach of providing the tenant’s billing information to property owners.
The owners were, in some cases, surprised to learn they could be held responsible for amounts unpaid by tenants.
The Municipal Act allows a municipality to add water and wastewater arrears (town-owned utility) to a tax bill.
However, collection efforts were paused in 2020 at the start of the COVID-19 pandemic.
Since March 2020, the town has been waiving interest and has paused collection for arrears of water and wastewater bills as part of the tax relief measures implemented during the pandemic.
Quinlan was making her report to council to get their support for resuming collection efforts, and possibly disconnecting service as a last resort.
This spring, staff have started sending notices to the property owners whose accounts are more than $200 in arrears requesting payment by May 25 or the amount would be added to the tax bill.
Tenants also received arrears notices with requests to pay by June 25 or the town would be escalating procedures to collections and possible disconnection.
According to Quinlan’s report, about $108,700 of the current $235,100 in water and wastewater arrears are linked to 438 property owner accounts and $126,400 in arrears are linked to 256 tenant accounts.
The water arrears balance is 1.9 per cent of the 2020 annual water/wastewater revenue and there are 11,208 water/wastewater accounts.
Letters were sent to new accounts letting them know the owner of the property could be held responsible for unpaid water accounts, even if the expenses were incurred by tenants.
“Treasury staff have spoken to many property owners who were surprised to learn their responsibilities and were frustrated that they could not have access to their tenants water arrears, which they might ultimately be responsible for,” said Quinlan’s report.
Though the current town bylaw states that the town will notify both tenants and property owners of arrears when a disconnection notice is issued, those arrears are not sent to landlords prior to the disconnection notice.
Staff are seeking legal advice over what information can be shared with property owners where the utility bill is in the tenant’s name.
Quinlan’s report states the town’s water services are at risk unless there’s a change in how staff respond to arrears.
“Arrears will continue to grow when residents are not adequately incentivized to find a means to pay for their water services,” states her report. “Additionally, without changing the upfront process that allows tenants to sign up for water accounts, we increase the risk of not collecting the arrears.”
In addition to immediate changes including allowing staff to resume collections and possible disconnection of service as well as issuing monthly letters to educate new property owners of their responsibility for unpaid tenant bills, Quinlan recommended a “refinement” of the current water bylaw.
“I think it’s just really important that staff work to continue to improve this collection process,” said Quinlan. “We’ve been communicating with Epcor a lot over the last several months to figure out what we can all do to make sure collections are in place and to make sure customers know how important it is to pay the water and wastewater bills.”
Quinlan said staff are looking at a possible requirement for a three-way agreement between tenant, landowner, and the town to confirm in a signed document the responsibilities of each of the three parties.
“It’s a more proactive approach, and we’re going to be discussing with our partners at Epcor how we can put that in place,” said Qhinlan.
Council as the strategic initiatives committee gave its support for staff to resume collections and possible disconnection to collect water and wastewater arrears. The decision will have to be ratified at a full council meeting.
Meanwhile, Quinlan will be performing an analysis of the water arrears, including possibly writing off balances considered to be not collectable because of changes in ownership.
You can read Quinlan’s report here.