City still formulating plan to tackle nearly half a million in delinquent utility bills

MARFA — When Marfa City Council members inquired about how much money Marfans owed on city utility bill payments during this September’s budget workshops, they weren’t expecting the number city staff delivered in a report: residents and businesses together had racked up over half a million dollars in unpaid city bills, which cover utilities like water, sewer, garbage and natural gas usage. But as the city investigated the debt, making good was not as simple as getting a few checks in hand.

By early October, the total utility debt sat at $576,101.35 owed to the city, in a town where the entire year’s budget is just over seven million dollars. While $166,270.83 of that was not yet 30 days overdue, the other share was over $400,000 of aging debt due to unpaid bills.

Mayor Manny Baeza and City Utility Clerk Lori Flores began investigating what types of accounts have gone unpaid for such long periods of time. The mayor this week said many accounts are under names of individuals who have “passed away, moved away or sold their house.” But others are active residents and businesses in the city.

While the city provided a complete report of its 1,200 accounts, names of residents and businesses were omitted. What did come to light from sifting through the pages of debts was a bigger picture of long overdue bills sitting on the books.

Of the 265 accounts with bills more than 30 days overdue, more than half, 180 accounts to be exact, had unpaid bills more than 90 days old. Meanwhile, some of the biggest offenders had bills totaling thousands of dollars. Twenty-eight accounts had accumulated bills over $5,000, and worse, three accounts alone owed more than $10,000 each.

Another share of the accounts are prone to moving in and out of “debt” through the fiscal year, because they are part of payment plans that even out billpay across all months, rather than having bills go higher and lower depending on the time of year. At times they pay over, and other times under, their usage, but come out even at the end of the year.

COVID-19 is another complicating factor for the debt and the hopes for its future collection. This spring, as coronavirus cases ticked upward, council voted to waive late fees on unpaid utility bills.

Baeza agreed that the waiving of fees was a moral decision rather than a business decision by the city, a move made to help people during the financial challenges of the pandemic.

“Initially, when I signed that emergency declaration, that was one of the first things on there. We didn’t want to disconnect anyone for not paying utility bills,” the mayor said. “Being a tourist economy, we knew people would not be working as many hours or losing their jobs so that’s why these decisions were made.”

But as the virus and its economic effects have persisted, the city has decided it’s time to move forward. It was decided at a council meeting last week that late fees will begin again as of this billing cycle.

The mayor did think that the waiving of fees led some residents to prioritize other bills over city bill payments. “If you’ve not disconnected for not paying your bill, I think that’s going to be a lesser priority to pay that bill,” he said, suggesting electric bills, phone bills and rent payments would have likely been a higher priority for local residents during the pandemic.

Baeza said that the council is tied up this month focusing on a short-term rental ordinance and making adjustments to finalize last year’s budget, but hopes to tackle this topic at the first meeting in November. That meeting will likely be the first gathering of the new iteration of council, since three seats are up for election on November 3, and at least one will be filled with a new council member.

Still, Baeza said that the issue was not necessarily new. “This has been going on for the past three administrations. It all happened with the passing of the ordinance where everyone within city limits has to be connected to utilities,” he said this week. “We’ve had this bad debt for 10 years now, it’s not something that happened overnight.”

Marfa ordinances 07-18 and 08-01, signed under the administration of former mayor Dan Dunlap, both discuss requiring all houses to connect into the city utility systems. One states that “water, sanitary sewer and solid waste service fees will be charged regardless of the use of the service,” and that even disconnection will result in fees under certain circumstances.

These ordinances explain why accounts for houses that are vacant, including where the owner is deceased, are still able to have bills despite not using services. Baeza said those who inherit homes but don’t live in the area may receive the bills, but might still choose not to pay them. Under the ordinances, the city is authorized to “perfect a utility lien upon property” if it is not a homestead protected by the Texas Constitution.

As previously reported, Dunlap, the former mayor and current accountant contracted by the city, suggested the city could benefit from hiring someone to oversee a variety of financial aspects of the city. “That’s what they’re missing, that full-time financial person that can oversee all of the financials, the utilities, the court, the accounts payable, accounts receivable,” Dunlap previously told The Big Bend Sentinel.

The city has not disclosed what sort of collection strategies it is looking to use for the unpaid bills, but the mayor said he wanted to ensure all accounts were “treated fairly across the board.” He also added, “There’s not much we can do about collecting it. Every few years we’ll go in and write off some of the debt. That’s where we’re at right now.”