City officials are making a change to Lawrence utility bills after concerns have been raised that the city is not doing enough to call attention to late fees it charges its customers.
An article in the Sunday Journal-World detailed how one customer had unknowingly paid three-years worth of late fees because the city lists the charges on the bill as an “adjustment,” rather than a late fee.
That practice soon will change. The city director who oversees the utility billing division said bills going out next week will have the term “late fee” on them rather than the less specific “adjustment” category.
Originally, the city had thought making such a change would not be feasible, given that the city does not own the billing software system that it uses. But Ed Mullins, the city’s finance director, said the city investigated the matter further after concerns were raised.
“We were able to make the change in house,” Mullins said.
Some city commissioners said they thought the terminology needed to be changed.
“Frankly it could be clearer,” City Commissioner Mike Dever said. “If it is a cost that people are paying, I think it is only fair that we know what we’re paying for.”
The Journal-World article also found that the percentage of city bills that have a late fee is significantly higher than several other area utilities. The city estimated about 30 percent of all bills have a late fee. That was much higher than the 10 percent found in Manhattan, the 17 percent with the Board of Public Utilities in Kansas City, Kan., and the 7 percent with Rural Water District No. 4 in Douglas County.
City Commissioner Aron Cromwell said he wanted to find out why that percentage had reached such a level.
“That is definitely worth taking a look at,” said Cromwell, who also said he wanted to change the adjustment terminology. “That is a large number. I could understand 10 to 20 percent. Twenty percent would be too high, but 30 percent is definitely too high.”
Mullins said his department was preparing a report on that issue to deliver to City Manager David Corliss.
Mullins also provided information to other questions that have arisen about the city’s billing practices.
• He said the city is developing a request for proposals for a new company to process credit card payments and other electronic payments made to the city. Mullins said he hopes that as part of that process the city can begin offering a no-fee method for the city to make electronic payments.
Currently, the city offers a no-fee auto-bill pay service, but that requires the customer giving the city access to their bank account so a withdrawal can be made on a certain day of each month. For people wanting to make an electronic payment directly to the city, they must do so via credit card. The city charges a $3.95 convenience fee to cover fees the city is charged by the credit card companies.
Some utilities, like Westar Energy, have a system that allows people to pay their bills via an electronic payment online without a fee. Mullins said the city hopes to have a similar system.
• Customers are making electronic payments to the city using online bill paying services offered by many banks. But Mullins said customers need to understand that those electronic transfers are processed by a third-party consolidation company before the payment is received by the city. Mullins said that processing could result in a payment that is initiated on one day not being received by the city for two to three days later. Generally, electronic transfers initiated before 2 p.m. are considered received by the processing company on that day, and then delivered to the city’s bank account the next business day. Transfers initiated after 2 p.m. generally are not considered received until the next business day, and then are delivered to the city’s account the following day.