Published: June 13, 2008 01:33 pm         

Way past due — City must prioritize debt collection

Bluefield’s current city leaders are struggling to redeem the sins of the past regarding a lackadaisical collection of past-due fees that now add up to more than half a million dollars.

Last Tuesday the city Board of Directors yanked a contract with National Recovery Agency due to their inefficiency in recovering more than $565,000 in delinquent street, fire and garbage fees. In more than a year’s time, the collection agency had recouped less than 5 percent of the debt.

“A success rate of 3 to 5 percent is not acceptable,” Bill Calhoun, Bluefield’s chief financial officer, told the board.

We agree.

Looking at the numbers, it’s easy to see the board made the right move by terminating the contract with its current collection agency. Of the original $565,000 in past-due debt turned over to the agency last year, only a little more than $30,000 was recovered.

Additionally, $175,000 in additional past-due accounts was turned over to the same agency this year. Of this amount, the company collected about $6,000 — roughly 3 percent.

These figures are unacceptable, and we commend the board for wasting no more time and terminating the contract with this agency.

The plan now is to hire a new collection recovery service. “We will put it out to bid, and hopefully we will have local collection people out there who will do it,” City Manager Mark Henne said.

Until then, other resources will be used to continue the debt collection.

We empathize with the current city Board of Directors who have inherited this mountain of past-due debt from administrations past.

The issue of swift and efficient collection of past-due bills should have been made a top priority years ago. Instead, a lethargic approach to collections has resulted in a half-million dollar carrot of past-due debt dangling just out of reach of the current administration.

Just think of the development and diverse projects the city could fund with an extra $500,000.

In reality, there’s a good chance a portion of this money owed to the city will not be recovered. Some who owe small amounts may have moved away, while others may now be indigent. In these cases — when there’s a slim-to-none chance of recovering decades-old street or garbage fees — the city needs to simply cut bait and move on.

However, in cases where those who owe have financial resources available — yet fail to pay back debts because it may dent their preferred lifestyles — the city must take an aggressive approach to recovering the money to which it is rightfully owed.

We understand times are tough. But if the vast majority of city residents can pay their monthly municipal bills, there’s no excuse for others to get an easy out on their current or past-due debts.

     

• Click to discuss this story with other readers on our forums.