June 21, 2005
SUBJECT: Public Hearing to Cause Charges for Non-Payment of Utility Services and Non-Payment for the Cost of Abatement of Public Nuisances to be Placed on the FY 2005/2006 Tax Roll
REPORT IN BRIEF
The City of Sunnyvale provides utility services to all properties within city limits. Additionally, the City enforces codes related to the maintenance of private property throughout the City. Periodically, the City abates nuisances on private property in order to promote the public health and safety as well as the general welfare of the public.
Charges for both utility services and public nuisance abatements are billed to customers directly by the Department of Finance. Some of the properties receiving these services have been consistently delinquent. Attempts to collect these delinquent debts through the City’s standard collection process have failed.
Staff is recommending that assessments be filed against these properties in accordance with Sunnyvale Municipal Code Sections 12.50.110 and 9.26.080.
BACKGROUND
The City of Sunnyvale Municipal Code requires that all properties receiving water service, from any vendor, also receive and be subject to charges for sewer and solid waste services with the exception of those properties utilizing a septic tank system which are exempt from the requirement for sewer service. The collection of sewer and solid waste from all occupied properties is essential to maintaining the health and safety of the community at large. For this reason, sewer and refuse charges are considered a civil debt. The City of Sunnyvale Municipal Code also provides the authority to declare a public nuisance and abate the nuisance.
The City of Sunnyvale Muncipal Code Sections 12.50.110 and 9.26.080 provide the City the opportunity to collect delinquent funds through the tax roll procedure. On June 7, 2005, the City Council adopted a resolution setting June 21, 2005 as the date for the public hearing on proposed tax roll assessments for non payment of utility services and for non payment of the cost of abatement of public nuisances. The public hearing is being held in accordance with the terms of the Sunnyvale Municipal Code and other legal requirements. All affected property holders were notified of the hearing and impending action.
EXISTING POLICY
The City of Sunnyvale Municipal Code Sections 12.50.110 and 9.26.080 allow the City to cause delinquent charges for water, sewer or solid waste services and nuisance abatements to be collected on the tax roll together with general taxes.
DISCUSSION
Charges for Non-payment of Utility Services
The properties listed in Attachment B have at least 3 outstanding bills and are a minimum of 60 days delinquent in paying for the utility services provided to them by the City of Sunnyvale. Repeated attempts to collect the delinquent funds through the billing and notification process have been unsuccessful. Each utility customer receives a bi-monthly bill. In addition customers receive a reminder notice, then a second notification of delinquency, and a final demand letter from the City Attorney’s Office notifying the customer that failure to pay will result in legal action. Further notification was delivered to each customer notifying them of the setting of the June 21, 2005 public hearing.
As the City of Sunnyvale cannot encourage these customers to pay their delinquent bills through discontinuance of service in the interest of public health, or because their accounts are now closed and there are new customers living at the property, the only recourse available to collect the debt is either to place an assessment on each of the properties or refer them to a collection agency. As these customers own the property and the municipal code allows an assessment to be placed and funds collected through the county tax rolls, staff recommends this course of action.
Charges for Non-payment of Nuisance Abatements
The City of Sunnyvale enforces laws related to the maintenance of private property throughout the City. In May 2004, a nuisance abatement was performed on the property, listed in Attachment B, located at 1085 Borregas Ave. The abatement consisted of removal of an excessive amount of debris, weeds, and tree trimmings.
The property owner was billed for the abatement. An invoice, three reminder notices, and a final demand letter from the City Attorney’s office were sent.
FISCAL IMPACT
The assessments total $6,826.50 in previously uncollected revenue. If approved, staff will forward the assessment information, with an additional 1% administrative charge, to the County of Santa Clara for collection on the 2005/2006 property tax roll. If collected, $998.65 would be credited to the Utility Enterprise Funds and $5,827.85 will be credited to the General Fund.
Should the current pattern of delinquency be allowed to continue for either nuisance abatement or utility customers without action, the financial burden of providing service to these properties will eventually fall to either paying utility customers for delinquent utility bills, or the General Fund for delinquent public nuisance bills.
CONCLUSION
The proposed hearing is consistent with past practice and applicable legal requirements. Action to collect debts through the tax roll process is a cost effective and efficient method of debt collection.
PUBLIC CONTACT
Notification of the hearing was published in the Sunnyvale Sun in accordance with the Sunnyvale Municipal Code. Notification of the hearing was also mailed or hand delivered to the property tax billing address for each owner of each of the affected properties. Public contact is also provided via publication and posting of the City Council Agenda. Reports to Council are available in the Sunnyvale Library and on the City’s website.
ALTERNATIVES
1. Adopt the attached resolution causing charges for non-payment of utility services and non payment for the cost of abatement of public nuisances to be placed on the FY 2005/2006 tax roll.
2. Do not adopt the resolution and move to collect the delinquent funds through other means.
3. Reduce or remove charges from the customers’ accounts.
RECOMMENDATION
Staff recommends Alternative 1 to adopt a resolution causing charges for non-payment of utility services and non payment for the cost of abatement of public nuisances to be placed on the FY 2005/2006 tax roll.
Prepared by:
Therese B. Balbo
Finance Manager
Reviewed by:
Mary J. Bradley
Director of Finance
Approved by:
Amy Chan
City Manager
Attachments
A. Proposed Resolution (.pdf format)
B. Property Listing (Exhibit A of Resolution) (.pdf format)
C. Notice of Public Hearing (.pdf format)