LARNED — Every month, the city of Larned sends an average of 529 late notices, or “red” bills, to utility customers. That’s nearly 20 percent of the city’s 2,700 utility contracts. Larned’s City Council declared that’s too many, and something needs to change. They tasked Kara Rath, the utility clerk, and Monica Steiner, the finance director, to conduct a study of how other cities like Larned combat similar problems. Rath and Steiner presented their proposal to the council Monday night.
Some changes may help some well-meaning customers to make payments on time. They included returning deposits ($50 for electricity, $25 for water) after one year of no missed payments, providing twice-monthly ACH billing based on pay day, lowering the late fee from 10 percent to 5 percent, and discontinuing the $1.25 convenience fee for those who pay online.
“It’s actually easier for us if they pay online,” she said. “We get a lot of calls from people who pay over the phone because they want to save the fee, and that takes up our time.”
They also proposed stricter action for habitual late payers who may be playing the odds, waiting until service is turned off before loosening their grip on payment. City Council members were in agreement with a request to make customers who have utilities turned off wait a mandatory 24-hour period before reconnection.
Randy Parker, the city’s electric distribution superintendent, weighed in. Shut offs are handled by his department. Two employees are required for safety purposes. Depending on how many shut offs there are, it can tie these employees up anywhere from half to a the majority of the day, he said. What’s frustrating, he said, is they can turn service off, and by the time they make it around the block, the customer has already called city hall, made arrangements or a payment, and they are being asked to turn service back on again.
“It’s just a cycle we go through every month. And the majority of the time, sad as it is, it’s the same people every month,” he said. “It’s so bad that they know before we do that it’s time to be shut off. We can’t get out and do what we would normally do on a day because we are chasing our tails on these shut offs.”
Every customer learns when they establish service that bills go out on the first of the month, and are always due by the 15th. On the 16th, late notices go out, and a 10 percent late fee is applied. The shut off is essentially the third notice that payment is due.
Parker visited with a Kansas Gas representative recently. That company began implementing the mandatory 24-hour shut off, and when they did, those habitual late payers found a way to get in and pay their bill, he said. It resulted in less time doing shut offs and less paperwork, and that adds up to financial savings.
That bottom line result was enough for the city council. They approved changes as proposed by the staff, including the 24-hour mandatory shut-off. They asked City Attorney Ron Smith to prepare changes to the city ordinance to incorporate the proposed changes including payment structures and late fee changes.
Other important points for customers to consider:
• The city is not under the cold weather rule, so shut offs can occur during the winter.
• Customers will not be allowed to get more than 90 days behind on payment. When a customer gets that far behind, Steiner said, they need to come up with half the past-due bill, and make payment arrangements for the remainder. If they fail to payment contract, their utilities will be shut off until payment is caught up.
• City bills for residential accounts will once again be sent on postcards. Other cities use the postcard format, and it will save the staff time sorting and stuffing envelopes, and sending postcards cost less than traditional bills. Everyone on statement billing will continue to be.