HomeMy WebLinkAboutReg 2013-11-04 Item 4C - Resolution - Cancellation of Past Due Accounts ReceivableCOUNCIL AGENDA SYNOPSIS
Initials
Meeting Date
Prepared by
Ma -'s review
Council review
11/04/13
LA
CATEGORY Discussion
Mtg Date
E Motion
Mtg Date
fl Ordinance
Mtg Date
1-1 Bid Award
Mtg Date
Public Hearing
Mtg Date
— Other
Mtg Date
Resolution
Mtg Date 11/4/13
SPONSOR — Council fl Mayor HR DCD Finance Fire E IT 1- P&R Police PW
SPONSOR'S There are certain accounts receivable and returned checks that have been deemed
SUMMARY uncollectible and need to be removed from the Accounts Receivable ledger. The Council is
being asked to consider and approve the resolution ordering their cancellation.
REVIEWED BY El COW Mtg. — CA&P Cmte Z F&S Cmte _ Transportation Cmte
E Utilities Cmte _ Arts Comm. 1- Parks Comm. Planning Comm.
DATE: 10/22/13 COMA/In-TEE CHAIR: ROBERTSON
RECOMMENDATIONS:
SPONSOR/ADMIN.
COMMITTEE
Finance Department
Unanimous Approval; Forward to Consent Agenda 11/4/13 Meeting
ITEM INFORMATION
ITEM No.
4.C.
1
STAFF SPONSOR: PEGGY MCCARTHY
ORIGINAL AGENDA DATE: 11/4/13
AGENDA ITEM TITLE Resolution Ordering
the Cancellation
of Past Due Accounts Receivable
CATEGORY Discussion
Mtg Date
E Motion
Mtg Date
fl Ordinance
Mtg Date
1-1 Bid Award
Mtg Date
Public Hearing
Mtg Date
— Other
Mtg Date
Resolution
Mtg Date 11/4/13
SPONSOR — Council fl Mayor HR DCD Finance Fire E IT 1- P&R Police PW
SPONSOR'S There are certain accounts receivable and returned checks that have been deemed
SUMMARY uncollectible and need to be removed from the Accounts Receivable ledger. The Council is
being asked to consider and approve the resolution ordering their cancellation.
REVIEWED BY El COW Mtg. — CA&P Cmte Z F&S Cmte _ Transportation Cmte
E Utilities Cmte _ Arts Comm. 1- Parks Comm. Planning Comm.
DATE: 10/22/13 COMA/In-TEE CHAIR: ROBERTSON
RECOMMENDATIONS:
SPONSOR/ADMIN.
COMMITTEE
Finance Department
Unanimous Approval; Forward to Consent Agenda 11/4/13 Meeting
COST IMPACT / FUND SOURCE
EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED
$ $ $
Fund Source:
Comments:
MTG. DATE
RECORD OF COUNCIL ACTION
11/4/13
MTG. DATE
ATTACHMENTS
11/4/13
Informational Memorandum dated September 30,2013
Resolution in draft form with Attachment A
Minutes from Finance and Safety Committee meeting of 10/22/13
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TO:
City of Tukwila
Jim Haggerton, Mayor
INFORMATIONAL MEMORANDUM
Mayor Haggerton
Finance and Safety Committee
FROM: Peggy McCarthy, Finance Director
BY: Laurie Anderson, Fiscal Specialist
DATE: September 30, 2013
SUBJECT: Cancellation of Accounts Receivable
ISSUE
Each year a resolution comes before the Council for the cancellation of uncollectible accounts
receivable. For 2013, these items include: False Alarms equaling $200.00, Miscellaneous
Billings equaling $29,644.47 and NSF checks equaling $858.50 in the total amount of
$30,702.97.
BACKGROUND
The process for tracking accounts receivable is quite thorough. The steps below are followed
prior to preparation of the attached write -off resolution.
• Invoice is sent to recipient by the Finance Department payable in 30 days.
• If payment is not received within 30 days, the receivable is forwarded to our collection
agency, Armada Corp., and placed in pre - collect status.
•At this time, Armada sends a Delinquency Notice to debtor notifying them of the past -due
status of the receivable and asks them to contact the City to make payment. Payments
can still be made directly to the City while in pre - collect status.
•Once 30 days have passed in pre - collect status, the receivable then rolls over to active
collections. At the onset of active collections, a letter is sent to the debtor notifying them
of status change and advising that all payments must now be made through the
collection agency.
• While in active collections status, debtor is contacted both by phone and letter. A search
is made for assets with which the debt could be satisfied. Once the debt has been in
active collections for 45 days, it is then reported to the national credit bureaus.
• The last process in the collections cycle is the pursuit of legal action. This includes
attaching checking accounts, garnishments and lawsuits.
• The City will not issue or renew a business license until all outstanding debt owed to the
City is paid.
• It should be noted that while a debt may be written off our books; it is still active in
Armada's collections process.
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INFORMATIONAL MEMO
Page 2
DISCUSSION
The proposed amount of the 2013 cancellation of Accounts Receivable of $30,702.97 is higher
than last year's total of $8,777.89. This is attributable to two main factors:
• One of the requested write -offs is for $20,035.60. The original amount of this invoice,
which is for a foundation replacement and complete signal pole assembly replacement,
was $103,480.31. Washington Cities Insurance Authority paid $83,444.71 which is the
amount of the invoice net of our indirect costs of $15,035.60 and our deductible of
$5,000.00. While we are requesting write -off of the remaining balance, WCIA is pursuing
the collection of the remainder.
• Another of our requested write -offs is for an invoice for damage to a pedestrian pole. It
was damaged by a hit and run driver and, as such, we do not know whom to bill. The
invoice total is $6,006.80.
• The total of these two receivables is $26,042.40 which is 84.8% of the 2013 write -off total.
FINANCIAL IMPACT
The financial impact of cancelling $30,702.97 will be to reduce our accounts receivable balance
by this amount in keeping with Generally Accepted Accounting Principles (GAAP) for the writing
off of bad debt. Please note that while we are writing off the accounts receivable for accounting
purposes, the accounts are still being actively worked for collection purposes with the exception
of those accounts where we cannot identify the responsible party. Accounts covered by
bankruptcy law cannot be pursued.
RECOMMENDATION
The Council is being asked to approve the annual resolution authorizing the cancellation of
Accounts Receivable and to forward this item to the Consent Agenda of the November 4, 2013
Regular Meeting.
ATTACHMENTS
Draft Resolution with Attachment A.
C:IUsersllaurielDesktoplInfo Memo 2013.doc
4
RAFT
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
TUKWILA, WASHINGTON, ORDERING THE CANCELLATION
OF PAST DUE ACCOUNTS RECEIVABLE AND RETURNED
CHECK WRITE -OFFS.
WHEREAS, certain receivables and checks have been deemed uncollectible after
efforts by both the City and a collection agency have been unsuccessful; and
WHEREAS, the City will continue to pursue these receivables when practical;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, HEREBY RESOLVES AS FOLLOWS:
Miscellaneous Accounts Receivable and Returned Checks. The total of
$30,702.97 (per Attachment A) is deemed uncollectible.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at
a Regular Meeting thereof this day of , 2013.
ATTEST /AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk Kathy Hougardy, Council President
APPROVED AS TO FORM BY:
Shelley M. Kerslake, City Attorney
Filed with the City Clerk:
Passed by the City Council:
Resolution Number:
Attachment A — Past -Due Accounts Receivable and Returned Check Write -offs
as of September 30, 2013
W: \Word Processing \Resolutions \Past Due Accts Recv & Write -offs 9 -24 -13
LA:bjs
Page 1 of 1
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Date
12/31/12
12/05/11
12/05/11
12/07/11
12/31/11
09/29/10
10/07/11
11/04/10
Attachment A- Past Due Accounts Receivable and Returned Check
Customer
Advance Interactive Systems
Emerald City Marketing
Emerald City Marketing
Emerald City Marketing
Emerald City Marketing
Habitat for Humanity
Hartung Building
Kimco Realty
Total False Alarms
Fund #
000
000
000
000
000
000
000
000
nvoice /Ck #
PF -02109
PF -01751
PF -01752
PF -01783
PF -01857
PF -01500
FF -00166
PF -01576
False Alai;
Amount
$ 25.00
$ 25.00
$ 25.00
$ 25.00
$ 25.00
$
$
25.00
25.00
25.00
200.00
For
Police false alarm
Police false alarm
Police false alarm
Police false alarm
Police false alarm
Police false alarm
Fire false alarm
Police false alarm
rite -offs as of 9/30/2013
Notes
Chapter 7 Bankruptcy
To Armada 9/17/12-Status-Skip-No Locate
To Armada 9/17/12-Status-Skip-No Locate
To Armada 9/17/12- Status - Skip -No Locate
To Armada 9/17/12-Status-Skip-No Locate
Unresponsive to calls -moved to Renton 9 /13/10
Unable to locate owner -bad address
To EPR 11/21/11
Date
05/06/11
01/26/11
06/08/11
12/07/10
06/08/11
10/07/11
12/13/12
11/15/11
03/27/09
06/15/11
07/30/12
Customer
African Paradise Restaurant
Boulevard Home Furnishings
Boulevard Home Furnishings
CB Richard Ellis
Deluxe Film Services
Deluxe Film Services
Info Only -Hit and Run
Prabhjeet Malhi
Norandex - Reynolds
Godfrey Pamosoo
Zoopa's
Total Misc. Billings
Date Customer
7/20/2011 Olalade Williams Oakes
8/16/2011 Pauline A. White
9/17/2011 James P. Taylor
12/5/2011 Lisa M. Milkey
6/5/2012 Jamila A. Baker
6/20/2012 Richard L. Murchison
Total Returned Checks
Write -off Grand Total
Fund #
000
000
000
000
000
000
000
000
000
000
000
voice /Ck #
RF -00678
RF -00643
RF -00697
RF -00622
RF -00709
RF -00739
MB -01179
MB -00906
RF -00318
MB -00817
RF -00827
cellaneous
Amount
$ 60.00
$ 60.00
$ 85.00
$ 30.00
$ 85.00
$ 110.00
$ 6,006.80
$ 20,035.60
$ 23.15
$ 3,088.92
$ 60.00
$ 29, 644.47
Returned Checks
Fund # Invoice /Ck # Amount
000 1081 $ 160.00
000 1116 $ 290.00
000 2033 $ 120.00
000 104 $ 91.00
000 1021 $ 154.00
411 2770 $ 43.50
$ 858.50
$ 30, 702.97
For
Fire re- inspection fee
Fire re- inspection fee
Fire re- inspection fee
Fire re- inspection fee
Fire re- inspection fee
Fire re- inspection fee
Replace pedestrian pole
Foundation & signal pole repl
Fire re- inspection fee
Repair of guardrail
Fire re- inspection fee
For
Adventure Camp
Day camp
Adventure Camp
Youth Basketball
After School Program
Golf Can Rentals
Notes
To EPR 9/13/11-Business closed 4/4/12
To EPR 12/9/11-Business closed 6/16/11
To EPR 12/9/11-Business closed 6/16/11
Did not manage this property- Gateway Olympia pd. half
To EPR 9/13/11- Business closed I0/1/11
To EPR 9/13/11- Business closed 10/1/11
Unknown driver - unable to bill
. Balance after payment by WCIA
Bal. after payment from EPR -They have since moved.
To EPR - 11/21/11
Chapter 7 Bankruptcy
Notes
To Armada Corp 9/11/12
To Armada Corp 9/11/12
To Armada Corp 9/11/12
To Armada Corp 9/11/12
To Armada Corp 9/11/12
To Armada Corp 9/11/12
EPR= Evergreen Professional Recoveries; our for
er collection agency.
1 Writeoffs 8- 31- 13.xlsx
Armada Corp has been our collection agency since mid -2012.
9/25/2013
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City of Tukwila
FINANCE AND SAFETY COMMITTEE
Meeting Minutes
October 22, 2013 — 5:30 p.m.; Conference Room #3
Finance and Safety Committee
PRESENT
Councilmembers: Dennis Robertson, Chair; De'Sean Quinn and Kathy Hougardy (Absent: Verna Seal)
Staff: Peggy McCarthy, Vicky, Carlsen, Stephanie Brown, Kim Gilman, Shelley Kerslake,
Brendan Kerin, Nora Gierloff, Christy O'Flaherty, Bruce Linton, Laurel Humphrey
Guest: Chuck Parrish
CALL TO ORDER: Committee Chair Robertson called the meeting to order at 5:30 p.m.
I. PRESENTATIONS
No presentations.
H. BUSINESS AGENDA
A. Ordinance —Civil Service Commission
Staff is seeking Council approval of an ordinance that would revise Tukwila Municipal Code Chapter 2.42,
Civil Service Commission, to reflect the current provisions of Revised Code of Washington 41.04.010,
governing the use of Veteran's Points in hiring and promotional processes. Candidates eligible for
Veteran's Points can claim either a 10% or 5% credit to their score, depending on retirement status. The
proposed ordinance is also in alignment with recently revised civil service rules. UNANIMOUS
APPROVAL. FORWARD TO NOVEMBER 4 REGULAR CONSENT AGENDA.
B. Resolution — Council Benefits
Staff is seeking Council approval of a resolution that would update health insurance benefits for
Councilmembers in response to the Patient Protection and Affordable Care Act (PPACA) of 2007. Since
2001, Councilmembers have received a benefit in which they can receive reimbursement for eligible
medical expenses up to $3,400 per year, but this option is prohibited under the PPACA. Enrollment in the
City Self - Insured Medical Plan or Group Health Cooperative will be the medical benefit options for
Councilmembers as of January 1. The monthly premium for individual Councilmembers would be paid by
the City as it is for employees ($509.94 for City Self - Insured and 717.98 for Group Health).
As follow up to the October 8 committee discussion, staff returned with an updated draft resolution that
includes the option to enroll in the Group Health Cooperative and adds a recital explaining the impetus for
the change. Staff also provided clarification on the tier of coverage for a Councilmember already
possessing coverage via their employer and their spouse's employer. In this scenario, the City coverage
becomes second tier, and the spouse's employer coverage falls to third. UNANIMOUS APPROVAL.
FORWARD TO OCTOBER 28 COMMITTEE OF THE WHOLE.
C. Resolution — Cancellation of Past Due Accounts Receivable
Staff is seeking Council approval of the annual resolution that would declare the cancellation of
uncollectible accounts receivable. The total for this year is $30,702.97, which is higher than last year due
to a complete foundation and signal pole assembly replacement as well as a hit and run damage to a
pedestrian pole. Staff reviewed the rigorous process by which items are determined to be uncollectible.
UNANIMOUS APPROVAL. FORWARD TO NOVEMBER 4 REGULAR CONSENT AGENDA.
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