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San Fernando moves forward with water shutoff policy; tax-roll assessment to be studied with rate review
Summary
City staff will begin enforcing the council-approved residential water shutoff process while studying whether delinquent accounts could instead be placed on the property tax roll as part of an upcoming Prop 218/rate study.
The San Fernando City Council directed staff to begin implementing the council-approved residential water shutoff procedures and to return with more analysis on a property-tax assessment alternative as part of the city's upcoming water and sewer rate study.
City staff and legal advisers told the council that state law permits local agencies to collect delinquent water charges via the property tax roll under Health and Safety Code provisions, but the city would first need to invoke that authority under the Prop 218 process. City Attorney Richard Padilla said, "it is typically done incident to either the establishment of new water rates or when you're increasing water rates." Padilla also noted the legal distinction between residential protections and collections for nonresidential accounts.
The staff presentation summarized operational trade-offs. Finance staff reported 967 utility accounts more than 60 days past due, totaling about $792,000 as of Dec. 30. Staff said assessments would push balances to the tax roll and delay cash recovery for the utility; shutoffs, by comparison, produce faster payment but are more disruptive in the short term. City Manager Nick Kimball and utility staff said the city has expanded outreach and payment-plan options and will hold an extra Saturday counter on Jan. 18 to help customers sign up for arrangements.
Councilmembers debated the equity and practical effects of each approach. Councilmember Victoria Garcia said she opposed using property tax assessments because of the conflicts it can generate between landlords and tenants. Councilmember Joel Fajardo said assessments can prompt payment and capture revenue otherwise not recovered. Several councilmembers emphasized protections for low-income households and noted the city already offers hardship payment plans and a reduced reconnection fee for qualifying customers.
The council did not adopt a property-tax assessment ordinance at the meeting. Instead the council's direction was to proceed with the previously approved shutoff policy (effective Jan. 1 per an earlier council action) and to include analysis of a tax-roll assessment option in the city's forthcoming Prop 218/rate study so the council can consider the option with full fiscal information.
Staff said they will return with updated arrears figures and a report when the rate-study and Prop 218 work is brought back to council.
