 Currently the only recourse the city has on overdue sewer accounts
is to file liens against the real property. However, that has little
effect on the property owner until he or she reaches a point of
selling the property.
The most recent attempt to collect these bills involved publicly
listing names and addresses, along with dollars owed, in local media
sources, including a red button on the front page of the Lincoln
Daily News.
The idea behind advertising the names was to embarrass some
property owners into paying their bill to get their name off the
list. At first there was some positive response to this, but now it
appears that those left on the list don't care if they are known to
the public.
Tuesday evening at the city's committee-of-the-whole council
meeting, Alderman Buzz Busby, who chairs the city sewer committee,
said he had submitted a contract from Illinois American Water to
city attorney Bill Bates, council members and Mayor Keith Snyder two
weeks ago.
The contract would afford the city the opportunity to order water
shut-offs to residences where the sewer bill is past due.
Busby said Bates was taking exception to a clause in the contract
that would hold the water company completely harmless for the
consequences of the water shut-off or any incidents that occurred
during the shut-off process, with the exception of cases of "gross
negligence."
Busby said the city had approved similar stipulations in other
contracts in the past, but Bates argued that they have done no such
thing.
"I don't know that we have ever passed a contract indemnifying
for negligence," Bates said.
When asked by Alderman David Wilmert to give a definition of
"negligence" and "gross negligence," Bates said that was part of the
problem. There is no clear legal definition or distinction between
the two, and such cases are usually decided by a court of law.
Alderwoman Marty Neitzel questioned why the city should agree to
a liability that would be charged to city insurance. She wondered if
Illinois American didn't have insurance for such problems.
Bates said that too was a problem because the city insurance
coverage will not cover what they refer to as "contracted
liability."
"It wouldn't be on the insurance," he said, "it would be on us."
Snyder said he and Bates had discussions with the attorney for
Illinois American and they are not going to budge on this issue.
He noted there had been other issues in the contract that the
water company attorney had amended for the city, but on this issue
the general idea was that Illinois American is offering a service
for which there is no profit involved for them, and therefore they
will take no responsibility.
Snyder said, "I told her this is not a contract that we can
recommend to the city and she just said ‘fine.'"
Wilmert asked if the city could buy insurance that would cover
contracted liability and was told that was unknown at this time but
could be investigated.
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The discussion then moved to the effect of doing water shut-offs
to area residents. Neitzel asked if there were exceptions or
problems that might arise from shutting off homes with small
children.
Bates said the state of Illinois regulates shut-offs and that the
city will have to follow the law in ordering this type of action.
Alderman Tom O'Donohue also commented on property, saying there
would be instances where a tenant was paying the water bill, the
landlord not paying the sewer, and yet it would be the tenant who
suffered.
Neitzel responded simply by saying, "That is not good."
It also came up that once the water is shut off, the residence
becomes a zoning and safety issue for the city, which would then add
a greater burden to the work of the safety officer, John Lebegue.
Busby said the contract with Illinois American included a letter
that would be issued to the tenant and the landlord, letting them
both know what was about to happen.
Alderwoman Stacy Bacon said she couldn't get behind this kind of
action. She wondered if the city could hire a collection agency to
deal with this.
Busby said the agency would charge approximately 30 percent of
the amount collected and that only about 30 percent of the
delinquent accounts would be collectible in that fashion.
Busby said there are other cities in the region that are using
this contract effectively, and Bacon said she'd like to know what
they are doing to cover themselves on the liability issues.
Alderwoman Melody Anderson said she'd also like to hear from
those cities about how they handle the landlord-tenant situation.
Anderson also wondered if the city should rethink their billings,
perhaps putting the responsibility on the tenant.
Bates said that could also be a problem for the city because
tenants are more mobile. They could move, leaving bills unpaid, and
then there would be a new issue.
There were also comments on whether or not landlords would reduce
rental rates accordingly if they didn't have to pay the sewer bills.
In the end, the group decided they wanted to look into insurance
for contracted liability, wanted a list of local cities that are
using this contract and an opportunity to talk to those cities about
how they are handling the various situations discussed.
[By NILA SMITH]
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