Highland News Leader

Highland to stop reimbursing townships for helping people with utility payments

An electricity meter.
An electricity meter.

The city of Highland is pursuing an ordinance that would stop reimbursements to townships for helping people pay their utility bills.

During its meeting on Jan. 16, the Highland City Council advised the city’s Director of Finance Kelly Korte to draft an ordinance that would cut Helvetia and Saline townships out of the city’s utility assistance program. The decision was made after a discussion which was prompted by Korte, who said she needed direction from the council to move forward.

In 2008, the City Council approved the creation of the city’s utility reimbursement program.

“Based on the fact that the economy was in the tank,” said City Manager Mark Latham.

Through the program, the city provides reimbursement to agencies that help people pay for their utilities. The Highland Area Christian Service Ministry, St. Vincent DePaul, as well as Helvetia and Saline townships were included in the ordinance as approved recipients for city funds.

“The two townships were overwhelmed with the amount of requests they were getting,” Latham said.

Since the program’s creation, the city has reimbursed the agencies about 30 percent of their utility payments to the city up to  2/10 of 1 percent of the last audited fiscal year’s gross utility sales from utilities. For the fiscal year 2006-2007, that amounted to $27,609, according to a memo from the director of finance in 2008. In fiscal year 2017, those reimbursements totaled about $32,416. They were $36,714 in 2016; $40,310 in 2015; $30,156 in 2014; and $32,415 in 2013, according to Korte.

Korte said, because the economy has improved, city officials decided to reevaluate the program’s necessity.

“It was decided to determine if this assistance program should be discontinued at the township level, as they the ability to collect tax dollars for this purpose,” Korte said.

Council comments

The council members agreed the program needs to change.

Councilman Aaron Schwarz said he thought the program should be axed altogether, because the city should not give its revenue to other agencies.

“I don’t think we are in the business of being a charity,” Schwarz said.

Councilwoman Peggy Bellm said she wants to keep the program for the charities, but discontinue reimbursements for the townships. She also mentioned that if the townships are ever in “deep trouble” they can ask for help, again.

“That is what I would do. I agree with Peg,” said Councilman Neill Nicolaides.

Councilman Rick Frey said he was more conflicted in his decision.

“It’s a bad deal for everyone, all around,” Frey said.

At first, Frey proposed that the program should be kept at all levels with a stricter cap on the reimbursement amount. But after more discussion, Frey sided with Bellm and Nicolaides.

At the end of the discussion, the council advised Korte to cut the townships out of the program. Korte said she will have an ordinance for vote at the next council meeting Feb. 5 and it will be drafted to be effective May 1.

What about the townships?

The city sent letters to Helvetia and Saline townships Dec. 8, 2017 to explain the situation. Judy Schmitt, the Helvetia Township supervisor, responded with a letter on behalf of the Board of Trustees.

Schmitt relayed that the program was also initiated as a means to offset a $20 fee Highland adds to disconnect notices. When the township makes a payment for someone with a disconnect notice, the fee is automatically paid, which Schmitt said reduces the effectiveness of the township’s assistance.

“We are, in effect using citizens’ tax dollars to pay the $20 city administrative fee first and past due utility amounts second,” Schmitt said in her letter.

Schmitt said it is hard to know how losing the program will effect the township, as the amount of people it helps varies from month to month. Schmitt estimated that, without the program, about nine people would have been without assistance in December.

Schmitt said that while economic conditions have improved, the need for utility assistance has not.

In her letter, Schmitt provided a recap of dollars paid by the township to the city for utility assistance since the program was implemented. With the exceptions of fiscal years, 2010-2011, 2011-2012 and 2016-2017, the payments made by the townships to the city have increased each year.

Last year, the township paid about $46,425 to the city for utility assistance, the year before they paid $61,967, and $58,828 from 2014-2015. Schmitt cited population increases and extreme weather conditions as part of the reason for need of assistance.

Saline Township Supervisor Curt Messerli agreed.

“I agree the economy is improving, but there is still the same approximate amount of people showing up per year,” Messerli said.

Messerli estimated Saline Township gets about $2,500 to $3,000 from the city’s reimbursements on a yearly basis. Messerli said without the reimbursement, the township will do what it can to keep up.

“It doesn’t change our program, just how many you can help,” Messerli said.

In their responses, both township supervisors said they would like to see more promotion of the city’s balanced payment plan, or budgeted billing, for utilities. The plan averages participating citizen’s utility bills throughout the year, so they can have the same utility payment every month, according to Latham.

However, both of the supervisors were either unaware the city had such a program, or felt the city has not done an adequate job promoting it. Messerli said that if these citizens utilized the program, it could help a lot with their budgeting, as they would not be surprised with drastically higher monthly bills.

“Some of these people are just a car repair or dental bill away from not making it that month,” Messerli said.

Latham said that the city can set up a balanced payment plan for interested parties. Latham also mentioned that it is the citizens responsibility to be proactive about their utility bill. He suggested citizens notify the city when they seek assistance, so they can work around the $20 city administrative fee.

For citizens wishing to contribute to other people in need, they can donate through the city’s Good Samaritan program on the utility bill, according to Latham.

“It’s a line item on everyone’s bill, if they want to donate,” Latham said.

Megan Braa: 618-654-2366, ext 23, @MeganBraa_