New Bern aldermen on Tuesday will consider a proposal to lessen the severity of the city’s utility deposit policy that has sometimes resulted in four-figure deposits for new customers with less than stellar credit, and soften other rules aimed at existing customers who fall behind in paying their bill.
The recommendations cap the deposit at $500 for new residents, rather than the sum of the two highest bills rung up by the previous resident. It also won’t kick in the first time when a customer who has fallen behind asks for a payment arrangement, or the first time a customer’s check bounces.
Payments could also be billed as installments.
The city’s utility deposit has been controversial from the start (it was instituted in 2014), putting low- and moderate-income individuals and small businesses struggling to make ends meet in further financial distress. However, it has helped the city reduce the rate of bad debt write-offs, and earned the city a coveted top rating from an agency that virtually no one in New Bern outside city hall cares about.
At its May 8, meeting, the Governing Board established a working group consisting of aldermen Sabrina Bengel, Jameesha Harris and Barbara Best to meet with the Director of Finance to discuss the utility deposit.
As a result of the group’s discussions, the following changes are recommended for residential customers effective July 1:
- Per fiscal year, deposits will not be assessed on the first payment arrangement. Payment arrangements may be billed as installments. No late penalties or fees will be assessed if the payment plan is adhered to as agreed upon.
- Per fiscal year, deposits will not be assessed for the first check returned for insufficient funds.
- New customers may pay deposits in installments with 50 percent due at the time service is established and the balance payable over four billing cycles. Payment arrangements are not permitted until the deposit is paid.
- New residential deposits shall not exceed $500.
- These changes are not retroactive.A memo from J.R. Sabatelli, Director of Finance is attached and provides additional, pertinent information. (See Backup)
The agenda item calls for a discussion, and it takes four votes of the seven-member board to pass an item that has been moved for consideration.
Assuming that Bengel, Harris, and Best vote for the policy (since they are the ones who proposed it), it would need only one more vote to pass. It is doubtful that Alderman Jeffrey Odham or Mayor Dana Outlaw would vote for it, since they were the ones who pushed for the existing policy back in 2014. Alderman Johnnie Ray Kinsey was also on the board that approved the existing policy, but he has shown more willingness to vote with new board members and against the previous status quo.
It is unknown how new Alderman Bobby Aster will vote.