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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 09/15/2020 - SECOND READING OF ORDINANCE NO. 108, 2020, AMENDIN Agenda Item 3 Item # 3 Page 1 AGENDA ITEM SUMMARY September 15, 2020 City Council STAFF Lisa Rosintoski, Utilities Deputy Director, Customer Connections Jamie Gaskill, Sr. Supervisor, Project Management Cyril Vidergar, Legal SUBJECT Second Reading of Ordinance No. 108, 2020, Amending Chapter 26 of the Code of the City of Fort Collins to Clarify Utility Accounts, Billing and Collections. EXECUTIVE SUMMARY This Ordinance, unanimously adopted on First Reading on September 1, 2020, adopts changes to City Code to align with requirements in the 2020-2025 LEAP Vendor Agreement. Under current billing practices, utility bills are treated as a single customer account payment balance, and payments made to an account are applied equally across utility service products on that account. The Code changes will allow for Low-Income Energy Assistance Program (LEAP) payments to be applied only to electric service (as required in the 2020- 2025 LEAP Vendor Agreement), even if a customer has other Fort Collins utility services (e.g., water, wastewater, stormwater and/or broadband). These Code changes will enable Fort Collins Utilities to remain a LEAP Vendor which benefits the 200+ income-qualified customers that receive LEAP in two ways: (1) they get a more accurate benefit amount because Fort Collins Utilities is able to provide Estimated Home Heating Costs (EHHC) from which LEAP bases benefit calculations, and (2) it is more convenient for the customer because LEAP payments are automatically applied to a customer’s utility account. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on Second Reading. ATTACHMENTS 1. First Reading Agenda Item Summary, September 1, 2020 (w/o attachments) (PDF) 2. Ordinance No. 108, 2020 (PDF) Agenda Item 8 Item # 8 Page 1 AGENDA ITEM SUMMARY September 1, 2020 City Council STAFF Lisa Rosintoski, Utilities Deputy Director, Customer Connections Jamie Gaskill, Sr. Supervisor, Project Management Cyril Vidergar, Legal SUBJECT First Reading of Ordinance No. 108, 2020, Amending Chapter 26 of the Code of the City of Fort Collins to Clarify Utility Accounts, Billing and Collections. EXECUTIVE SUMMARY The purpose of this item is to adopt changes to City Code to align with requirem ents in the 2020-2025 LEAP Vendor Agreement. Under current billing practices, utility bills are treated as a single customer account payment balance, and payments made to an account are applied equally across utility service products on that account. The Code changes will allow for Low-Income Energy Assistance Program (LEAP) payments to be applied only to electric service (as required in the 2020 -2025 LEAP Vendor Agreement), even if a customer has other Fort Collins utility services (e.g., water, wastewater, stormwater and/or broadband). These Code changes will enable Fort Collins Utilities to remain a LEAP Vendor which benefits the 200+ income - qualified customers that receive LEAP in two ways: (1) they get a more accurate benefit amount because Fort Collins Utilities is able to provide Estimated Home Heating Costs (EHHC) from which LEAP bases benefit calculations, and (2) it is more convenient for the customer because LEAP payments are automatically applied to a customer’s utility account. STAFF RECOMMENDATION Staff recommends adoption of the Ordinance on First Reading. BACKGROUND / DISCUSSION LEAP Vendor Background Fort Collins Utilities became a Low-Income Energy Assistance Program (LEAP) Vendor in 2016 as part of the City’s efforts to start the Income-Qualified Assistance Program. Instead of requiring customers to complete a separate qualification threshold, the Income-Qualified Assistance Program uses LEAP enrollment as the qualification criteria for eligible customers to receive discounted rates on select utility services. Although being a LEAP Vendor is not a requirement for Fort Collins Utilities to access data about LEAP c ustomers, it enables the City to provide a more streamlined and comprehensive portfolio of low -income programs. Background on Changes Needed to Maintain LEAP Vendor Status During the process to renew the LEAP Vendor Agreement between the Colorado Depart ment of Human Services (CDHS) and Fort Collins Utilities, staff discovered several requirements in the renewal Agreement that require the City to revise Code and processes to ensure compliance. Prior to staff and CDHS preparing the renewal Agreement, a federal audit of the LEAP program also revealed a need for LEAP vendors to provide more specific assurances to CDHS regarding how customer benefits were being applied. According to ATTACHMENT 1 Agenda Item 8 Item # 8 Page 2 the Agreement, LEAP benefit payments may only be applied to electric service products. To verify compliance with this requirement, City Code needs to be modified to state that 100% of LEAP payments may be applied to the electric service amounts due on a customer’s account, even if other utilities are received at a premise, and under the City’s general collection practices all monthly service fees are otherwise treated as a single payable amount. Staff recommends clarifying the Code and payment processing practices for several reasons: • Acting as a LEAP Vendor allows Fort Collins Utilities to offer a more comprehensive portfolio of low-income utility offerings. • By remaining a LEAP Vendor, Fort Collins Utilities enables customers who receive LEAP payments to receive more accurate benefit amounts because Fort Collins Utilities can provide LEAP with Estimated Home Heating Costs (EHHC) that are based on past utility use at the premise where a LEAP recipient resides. Without the EHHC, LEAP recipients receive payments based on a default formula that may not resemble actual use at the premise where they reside. • As a LEAP Vendor, Fort Collins Utilities applies LEAP payments directly to a customer’s utility account. If Fort Collins Utilities is no longer a LEAP Vendor, customers will receive LEAP benefits on an Electronic Benefits Transfer (EBT) card, which represents a form of payment not accepted by Fort Collins Utilities. In which case, customers must get cash out with the EBT card and then pay utility bills in-person, adding extra time and effort for the customer to pay utility bills using LEAP benefits, increasing barriers to program outcomes. CITY FINANCIAL IMPACTS This Code change will require staff time to execute. Under the separate LEAP Vendor Agreement, additional costs may be incurred to support manual processes until it is determined whether additional programming may be required for the new billing software to accommodate the requirement payment processes. There are no other known financial impacts to the City. BOARD / COMMISSION RECOMMENDATION The Energy Board reviewed the proposed Code changes at its regular August 13, 2020, meeting, and staff has incorporated the Board’s feedback. The Water Board was presented with the proposed Code changes via a Memorandum during the week of August 17, 2020, and staff has incorporated the Board’s feedback. ATTACHMENTS 1. LEAP Vendor Agreement (PDF) -1- ORDINANCE NO. 108, 2020 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO CLARIFY UTILITY ACCOUNTS, BILLING AND COLLECTIONS WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the electric utility, as set forth therein; and WHEREAS, Chapter 26 of the City Code regulates and governs the provision of utility services; and WHEREAS, Chapter 26, Article XII, of the City Code sets forth the procedures and conditions for billing and collection of fees and charges for utility services, including resolution of delinquent balances and service disconnection, and terms for assessing and collecting fees and charges due for delivery of specified utility services; and WHEREAS, such provisions require updating and modification from time to time, for purposes of clarification, correction of errors and to ensure the Code remains a dynamic document capable of responding to issues identified by staff, customers, and public assistance agencies, and changes in technology for delivering utility services; and WHEREAS, Fort Collins Utilities staff has identified provisions of Chapter 26 of the City Code where clarification of procedures and conditions for billing and collection are required to better inform customers and align with current utility practices coinciding with delivery of utility services to qualified customers on whose behalf the City receives Colorado Low-Income Energy Assistance Program (LEAP) and other restricted utility program assistance funds; and WHEREAS, on August 13, 2020, the Energy Board reviewed and provided feedback to staff regarding the proposed City Code revisions clarifying billing and collection practices; and WHEREAS, on August 20, 2020, the Water Board reviewed and provided feedback to staff regarding the proposed City Code revisions clarifying billing and collection practices; and WHEREAS, the City Council has determined it is desirable to maintain appropriate utility service billing and collection practices, and that clarification of such practices in the City Code, as set forth herein, is in furtherance of the benefits provided by the City to its utility ratepayers. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. -2- Section 2. That Subsection 26-711(a) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-711. - Definitions; application. (a) The following words, terms and phrases, when used in this Article, shall have the meanings ascribed to them in § 26-1 and this Section: Financial Officer shall mean the head of the Financial Administration Unit or the designated representative of the Financial Officer. Program assistance funds shall mean monies received through local, state, or federal grants, credits, reimbursements, or other programs that provide financial support for qualified public utility customers served by the City. . . . Section 3. That Subsection 26-712(a) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-712. - Utility bill and account charges authorized; procedures. (a) The fees and charges established by this Code for services from the electric, stormwater, water and wastewater utilities may be billed together in one (1) utility bill with such fees and charges separately itemized and shall be billed to utility users not less than once each month. Service fees and charges for telecommunication facilities and services may be billed separately or included on a combined utility bill with other utility services, and such amounts shall be itemized separately and be payable in addition to all combined utility fees and charges. The Financial Officer shall collect, receive and disburse all such fees and charges for the separate utility funds in accordance with the Charter and related provisions of this Code. Other than when applying program assistance funds restricted to specific utility products or services delivered to qualified customers, customer utility payments shall be applied uniformly to all combined non- telecommunication utility service fees and charges due. . . . Section 4. That Subsections 26-713 (c) and (e) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-713. - Due date; delinquency. . . . (c) In case the user of any non-telecommunication services utility fails to pay a utility bill by the due date or fails to pay any other utility fee, charge, deposit or assessment prescribed by this Code, the City may disconnect either or both of the user's water and electric services to the property -3- and has the right to enter upon private property to accomplish this purpose. Such disconnections shall nevertheless be conditioned upon the terms associated with program assistance funds received by the City on behalf of qualified customers. . . . (e) Unless otherwise required by terms associated with program assistance funds received by the City on behalf of qualified customers, the terminated utility service will be restored after the customer or subscriber has paid in full all delinquent fees and charges, plus collection costs, together with the expenses of discontinuing and restoring service, including costs of after-hours labor and materials and specified fees, as provided in this Article. . . . Introduced, considered favorably on first reading, and ordered published this 1st day of September, A.D. 2020, and to be presented for final passage on the 15th day of September, A.D. 2020. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 15th day of September, A.D. 2020. __________________________________ Mayor ATTEST: _______________________________ City Clerk