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With deficit building, city looks for ways to help customers with utility bills

By Natalie Anderson
natalie.anderson@salisburypost.com

SALISBURY — The city is looking at ways to help families struggling with utilities payments and plans to work with others to pay down their balances.

Since March, a deficit of more than $300,000 has accrued, prompting city council members on Tuesday to ask City Manager Lane Bailey and the finance department look into ways the city can assist families struggling with utilities payments, particularly because the governor’s executive order prohibiting utility disconnections is set to expire next week.

Executive Order 142, enacted by Gov. Roy Cooper on May 30, prohibited utility disconnections for 60 additional days. It also prohibited the billing or collection of late fees and penalties from March until the end of the order. It extended repayment plans for at least six months. The order is set to expire July 29 and applies to residential accounts. The city has a similar order that it adopted in March that includes non-residential accounts and has no end date.

Shannon Moore, city financial services director, said Salisbury-Rowan Utilities has been working with customers on repayment and will limit disconnections but that significant debt has accrued since disconnections for nonpayment stopped.

Currently, the city has 853 residential accounts and 15 non-residential accounts on the “cut-off list” — that is, the list of accounts subject to disconnections under normal circumstances — according to a presentation Moore gave city council members Tuesday. The numbers are considered “somewhat cumulative” since April, Moore said, because some account holders might have taken care of their balances while others did not. The account number doesn’t necessarily represent the same accounts since April.

“Over time, the list is obviously growing,” Moore said. “From a staff level, our fear is that … the longer we let this linger, the worse that number becomes and the more unmanageable it is for a lot of our customers.”

As of July 15, the total number of non-residential accounts on the list were up to 37, but Moore said many have made payments on their balances. Part of the Paycheck Protection Program loans that businesses have received since April can be applied to utilities expenses.

In April, a total of 427 accounts were on the shut-off list, for a total deficit of $160,846. That account number grew to 605 in May with a deficit of $327,765.

But after council members expressed concern with customers struggling to pay off their debts due to the loss of a job or income, they agreed to keep the city ordinance in place until more information is presented at the Aug. 4 meeting.

Councilman David Post expressed concern for any residential account holders with section eight vouchers. Post noted those vouchers aren’t given to people for utilities purposes anymore and said allowing current voucher holders more time would ensure they don’t lose it or have to move from Salisbury.

The executive order doesn’t allow for the financial status of account holders to be questioned since all shutoffs were prohibited.

“We can’t get people to collect because there’s no incentive to do that right now for folks who could otherwise pay,” Bailey said. “We realize there’s some people who have lost jobs or lost income because of (COVID-19) and we want to continue to work with those folks. But we want to try and encourage the people that can begin to pay their bills to pay those back.”

Councilman Brian Miller said there may be other ways to assist those most impacted because the economic hardship of COVID-19 isn’t going away. He mentioned a pool of money being raised to help those customers as an example.

Bailey said he encourages council members and anyone else with the financial means to assist to reach out to Rowan Helping Ministries or the United Way, which has a COVID-19 Relief Fund. Both are agencies trying to help locals struggling from the impact of the pandemic at this time.

During a county commissioners meeting on July 13, the county voted to allot $499,868 to Salisbury after dividing each municipalities’ share of COVID relief funds from the state. The allotted amounts included a baseline of $50,000 with additional funding based on each municipality’s population. Bailey said he and Moore will ask if those funds can be used to help with utilities debt or that portions be given to nonprofits helping with the COVID-19 impact.

The county has recommended the funds be used for public safety concerns.

“I would think if we’re going to ever cut anybody’s water off — I hope we’re not going down that path — that this would be a public safety concern, and we can try to get these other organizations to help those particular people out,” said Councilwoman Tamara Sheffield.

Mayor Pro Tem Al Heggins added that the problem is “certainly a public health issue, without a doubt.”

In addition to Bailey exploring all options to help struggling families, Miller said, the city could look into using any surplus funds to help those people.

Salisbury-Rowan Utilities supplies water for Salisbury, Spencer, East Spencer, Granite Quarry, China Grove and Rockwell, which amounts to a service population of around 52,000 people and more than 19,000 water connections, according to the Salisbury 2020-21 approved budget. The utilities system contributes about $3.52 million, or 13.5%, to Salisbury’s general fund, which helps carry out the city’s administrative costs.

Unlike some smaller utilities systems, Bailey said, SRU is “going to be OK” because it’s financially solid.

“But we’re creating some huge debt loads for people that could otherwise pay,” he said, adding that the utility shutoff prevention applied to everyone, not just those most financially impacted by COVID-19.

Sheffield thanked the SRU and the city’s finance department for doing its best to work with families and collect some of the current debt, noting that as utilities are “something we can’t have anybody living in the city without,” being cognizant of that is “proactive in us working on a plan.”

Contact reporter Natalie Anderson at 704-797-4246.

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