Prince Albert city council has approved writing off more than $1.56 million in old outstanding accounts, most of them utility accounts.
The motion carried Monday after questions about how long the city waits before writing off unpaid bills and whether more can be done to collect money still owing.
The write-offs total $1,560,011.45. The largest amount is $1,370,537.44 in utility accounts. The rest includes $98,520.02 in general receivables, $25,926.82 in airport receivables, $59,000.68 in sanitation receivables and $6,026.49 in utility receivables.
According to the city report, the balances date from 2000 to 2019 and were previously held by a collection agency that has since closed. The report says the accounts are not expected to be collectible because collection steps had already been followed and no payments were received.
Chief Financial Officer George Marshall told council the city plans to handle write-offs differently going forward by bringing them forward each year instead of allowing a large amount to build up.
Coun. Troy Parenteau said the raw number could look large to residents and asked whether there was a more efficient way to deal with write-offs.
“Just look at these raw numbers. It does look like there’s a lot of money,” Parenteau said.
Marshall said the city still wants to wait at least seven years before bringing accounts forward because administration needs time to try available collection options.
“In doing that, we’ll bring smaller amounts on an annual basis,” Marshall said.
The city’s manager of financial operations said the city tried to collect the accounts in-house and also used a collection agency. What remains is what the city and the agency were unable to collect.
The city report says legal consultation indicated debt over seven years old is not legally enforceable to collect, although it may still be operationally enforceable depending on the situation.
Administration said the write-off does not create a new option for residents to avoid paying bills.The city report says collection steps had already been followed on the accounts, and council head old utility balances can still be tracked if someone later applies for a new water account.
Marshall said the write-off will not affect the city’s current financial position because the amounts had already been accounted for through allowances for doubtful accounts.
“This has already been accounted for,” Marshall told council.
Coun. Daniel Brown said he would not support the motion. Brown said the city is looking for money and should look at other ways to collect before writing off $1.5 million.
“We’re looking for money now. We’re just going to write $1.5 million off the books because we can’t find these people,” Brown said.
Brown said some names appeared to be connected to buildings or businesses still operating in Prince Albert. He said the city should consider publishing names or looking for other ways to recover at least part of the money.
“For us just to say, ‘Well, you got away with it,’ I think that’s leaving a bad name for people,” Brown said.
Coun. Bryce Laewetz asked why accounts from such a long time period were not written off earlier in seven-year increments. Marshall said the write-offs being considered covered 2010 to 2019, along with some older accounts not included in a previous write-off request.
Marshall also said collection work has improved. He told council the annual utility allowance for doubtful accounts was about $119,000 in 2019, but is now around $18,000 to $20,000.
Laewetz also asked whether people with old unpaid utility bills would still be flagged if they tried to open a new water account with the city.
The manager of financial operations said the city can still track old balances. If a person has an old outstanding balance, current practice requires it to be paid in full before they are eligible for a new water account.
Laewetz asked if the city would no longer be pursuing collection activity on the written-off accounts.
“That’s correct,” Marshall said.
The motion carried.
arjun.pillai@paherald.sk.ca
