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JMtr'~~ <br /> ~'~k. <br /> <br /> Harry Kim Barbara Bell <br /> Mayor - Director <br /> •l•TF~•f ~N~•J'! <br /> Nelson Ho <br /> Deputy Director <br /> (~II1Itt~'~T IT! ~~~t1Mit r, <br /> DEPARTMENT OF ENVIRONMENTAL MANAGEMENT ~ c~ <br /> 25 Aupuni S[reet, Room 210 • Hilo, Hawari 96720-4252 i7 , <br /> (808) 961-8083 • Fax (808) 961-8086 - - <br /> G` <br /> October 13, 2004 <br /> James Arakaki, Chair, and members of the Council <br /> Hawaii County Council ~ <br /> 25 Aupuni Street ~ n <br /> Hilo, HI 96720 <br /> SUBJECT: BILL 312 (Draft 5) <br /> Enclosed is draft 5 of Bill 312 relating to property owners being responsible for sewer bills. Draft 5 makes the <br /> following changes: <br /> 1. Section 21-32 (b) Eliminates the penalty for past due accounts, and adds a''/z percent increase in the interest <br /> rate per month, for a total of 1 percent per month. <br /> 2. Changes the approval date to October 1, 2005. <br /> Charging the higher interest rate as soon as the account is past due seems to be a much better balance of <br /> providing an incentive to pay on time, or as soon as possible if a customer missed the due date, while still <br /> making it possible for them to keep their account current. More specifically: <br /> • Fairness. A 10% penalty plus interest may be excessive. If someone is one day late they would be charged <br /> the full 10% penalty plus one day's interest. In the past, when the penalty wasn't being imposed until 60 <br /> days past due (90 days after billing), the penalty was fair because they had more than ample time to pay, but <br /> of course there was no incentive to pay until nearly 90 days after billing. <br /> • Fairness. The penalty could make it difficult to get a bill to a current status. Since payments are always <br /> applied to the oldest charges, if they get a month behind they will continually get hit with the l0% penalties <br /> and may just get deeper in debt than what they can recover from. <br /> • Incentives. Raising the interest rate to 18% per year, would make it comparable to credit card interest rates <br /> and make the County a less desirable source of financing. <br /> • Consistency. Solid Waste charges 1 '/z percent interest per month with no penalty. <br /> • FRESH. With the current billing system, bi-monthly customers are charged the penalty around 120 days. <br /> The new Utility Billing system in FRESH will help to speed up the collection process. <br /> • FRESH. Conversion to FRESH Utility Billing is expected in April, 2005. Implementation generally hits <br /> some ags. We wo 1 to be sure we are running smoothly before we begin these changes. <br /> Barbara Bell <br /> DIRECTOR <br /> cc: Mayor Harry Kim <br /> WWD 1 <br /> enclosure Comm. No. 3~•S <br /> n A ~ ~ Ref. To: <br /> lJu J ~ Hawai'i County is an equal opportunity provider and employer. R$f. t.`Ot8 <br /> <br />