Penalties for late utility bills returning to Merced, leaders say. Here’s how to get help
.JPG "The Civic Center in Merced on 18th and N streets.")
After a two-year recess in water shut offs and late fees for failure to pay utility bills, the delinquency process is resuming in the City of Merced this summer for the first time since February 2020.
The cost of delinquency forgiveness is starting to add up to a staggering price in Merced, officials said at Tuesday’s City Council meeting.
Still, residents continuing to struggle to make payments will have a couple options to keep their water on, despite the return of delinquency penalties come July.
The state order protecting California residents who fell behind on their water bills during the COVID-19 pandemic from having their water turned off expired Dec. 31.
While the state order only stipulated that faucets keep flowing, the City of Merced also halted penalties and late fees, in addition to permitting partial payments. Merced officials lauded the two-year grace period as necessary respite for struggling households, but noted that the city must transition back to business as usual before the cost becomes too much to bear.
“There’s only so much grace and mercy we can extend before the city is in a hard way, and unfortunately this has to be paid somehow,” Councilmember Delray Shelton said Tuesday.
Merced leaders agreed during Tuesday’s City Council meeting that action must be made to curb the past two years’ delinquencies, which have risen to over $1.2 million as of January, according to city staff. The delinquency rate last month was 22%, compared to the typical pre-pandemic rate of 1%.
“It is difficult to know if the delinquency is being caused by financial impacts due to COVID-19 or if customers decided not to pay for the utility service because they knew it would not get shut-off,” a City of Merced staff report said.
The City Council unanimously approved a July 1 start date to reinstate utility billing delinquency. Bills not paid by July 20 would be considered tardy. After an initial notice on July 22 and a final notice Aug. 23, the first water shut offs would occur Sept. 7.
How Merced residents can avoid water shut offs
Fortunately for residents still grappling with payments, some may be eligible for assistance in getting their bills paid.
Delinquent customers can avoid having their water turned off by applying for American Rescue Plan Act (ARPA) funding. Late last year, City Council approved a sweeping spending plan for the $27.4 million in federal ARPA dollars allotted for Merced. Funds in the amount of $1 million were carved out for a utility bill relief grant program for struggling households.
Merced residents can also agree to a payment plan to settle their bills within 12, 18 or 24 months.
Customers who apply for ARPA dollars or agree to a payment plan will not have their water shut off. City Council members urged staff to communicate extensively with delinquent customers so that they’re aware of their payment options, as well as work with residents to develop feasible payment plans for those who are financially suffering.
“I don’t want the people to keep drowning in bills,” Councilmember Jesse Ornelas said.
The city was also notified in January that its application to the Water Arrearages Payment Program was approved. Merced received a $192,303 check from the State Water Resources Control Board, a majority of which will cover utility customers’ past-due water bills. A small portion will pay for administrative costs.
Only bills accrued between March 4, 2020 to June 15, 2021 are eligible for the program. Funds will be applied as a credit toward eligible customers accounts. Late fees will not be charged for debt within the covered period.
The state also opened applications this month for a similar program targeting wastewater bills accrued during the same period. City staff are currently completing the application and expect to be approved by May. Like the water program, credits would be applied to customers’ past-due sewer bills.
This story was originally published February 25, 2022 at 5:00 AM.
