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• <br />Case# <br />CONCLUSION OF UNDER BILLED COMMERCIAL UTILITY ACCOUNTS <br />By: Diana Lund, Finance Officer <br />Background: <br />• <br />In September 2003, it was discovered that some of the city's commercial billing accounts were <br />being billed incorrectly for their water usage which in some occurrences affected sewer usage. <br />.Several commercial accounts were being billed based on a 1,000 meter when in fact they had a <br />10,000 meter. For example, if a business used 100,000 gallons of water (based on a 10,000 <br />meter). they were only getting billed for 10,000 gallons (based on the 1,000 meter). Thus, an <br />under billed account of 90,000 gallons. If this meter pertained to the businesses regular meter <br />and not for irrigation purposes, sewer. charges were also being under billed, as sewer is tied to <br />total water usage. <br />After many council worksessions and discussions with Connexus regarding how the under billed <br />accounts will be collected, the final resolution is being offered: <br />1. Connexus will give the City three quarters of billing services. This would <br />amount to approximately $43,164 based on the third quarter billing. invoice. <br />As the City is proposing to change utility vendors effective April 1, 2008, the <br />current third quarter invoice, fourth quarter 2007 and 1st quarter 2008 services <br />yet to be billed, will need to be the respective three quarters. <br />2. Send a letter to the respective commercial accounts of who were under billed <br />and charge them one-third of the amount outstanding as of January 1, 2002. <br />The amount attributable to under billings as of January 1, 2002 was $276,966; <br />so one-third would be equal to $92,322. Any accounts that were over billed, <br />which there was one, will be reimbursed in its entirety, Per the statute of <br />limitations, the City is only able to go back six years to collect on under billed <br />utility accounts. As the billing error was discovered and corrected fourth <br />quarter 2003, the outstanding amount able to be collected actually covers a <br />period of seven billing quarters -January 2002 through September 2003. It <br />should be noted that in October of 2003, each of these business were. <br />originally sent a letter and spreadsheet showing the total amount that their <br />account had been under billed so they are aware of the situation. <br />Funding Source: <br /> <br />None Required. Any funds retained will be placed in the respective water and sewer utility <br />accounts. <br />-389- <br />