No late fees mean lost revenue for cities and utilities

A COVID-era rule intended to help individuals has meant lost revenue for cities, and utilities.

Washington Gov. Jay Inslee’s Proclamation 20-23, first issued in March of 2020, doesn’t allow utilities to be shut off for a resident, nor for late fees to be charged.

That has meant that those who charge for utilities, such as local cities and electric companies, are holding higher amounts of their customers unpaid bills than usual, and that they also haven’t been able to bring in money from late fees like they have before.

Locally, the city of Grand Coulee currently is owed about $18,000 in unpaid utility bills. And the city collected $5,127 in revenue from late fees alone in 2019.

“It’s just another drop in the buck that will have to be absorbed,” Mayor Paul Townsend said about lost revenue  in an email to The Star. “The real problem is when this is lifted and these customers must make up for the unpaid bills. That’s going to be the real challenge.”

Coulee Dam, which charges for electricity as well as water, sewer and garbage, is owed about $40,000 from customers in arrears. The city collected $22,125 in late fees in 2019. 

Elmer City’s utility customers are about $3,500 in arrears. The town collected $2,450 in late fees in 2019.

Electric City customers are about $11,500 in arrears. That city collected about $8,700 in late fees in 2019.

The Electric City Council voted Nov. 10 to spend the city’s roughly $3,400 in remaining federal CARES (Coronavirus Aid, Relief, Economic Security) Act funds toward delinquent utility payments.

Almost $2,900 of that has gone toward the accounts of landlords whose renters have been unable to pay their utility bills, and either the landlord has been paying the bill or the outstanding delinquent bills have been accruing in the landlord’s name.

The other roughly $500 “will be split between three delinquent accounts where we know customers are elderly and/or in poor health,” explained City Clerk Peggy Nevsimal. 

On a larger scale, Grant PUD, which has over 42,000 customers, brought in about $943,500 in late fees in 2019 that the utility won’t be able to charge in 2020.

The PUD has seen a 5% increase over 2019 in the amount of unpaid bills over 90 days late, from $1.288 million at this time in 2019 to $1.356 million in 2020.

However, despite losing revenue from not collecting late fees, Grant PUD is in “good financial standing,” Public Affairs Supervisor Chuck Allen said in an email. “One of the benefits that we have seen this year is that we are making more money in the wholesale power market, which is helping us to offset some of the revenue losses we are having with late fees and some of the lower power sales to commercial and industrial customers in Grant County.”

Wholesale power is electricity sold outside of Grant County, Allen explained.

Allen said that according to a presentation given to PUD commissioners recently “total operating revenues for the utility were $5.2 million higher than the same period over the prior year. The increased revenues are being driven by wholesale revenues, which were $9 million more than the previous year.” 

The Star did not receive a reply from Nespelem Valley Electric prior to Tuesday’s deadline as to how much they may have lost from late-fee revenue or how much their customers may be in arrears.