DATE: June 17, 2025
TO: Mayor and City Council
FROM: Director of Public Works
SUBJECT Adopt a Resolution Confirming the Report and Special Assessment List Associated with Delinquent Water and Sewer Bills and Authorizing the Delinquent Charges to Become a Special Assessment Against the Properties if Not Paid by August 1, 2025
RECOMMENDATION
That the City Council adopts the attached draft resolution (Attachment II) confirming the report and assessment for delinquent water bills and sewer bills and authorizing the delinquent charges to become a special assessment against the properties if not paid by August 1, 2025.
SUMMARY
In November 2012, City Council approved collection of delinquent water and sewer service charges by way of special assessments on property tax rolls for property owners that receive only sewer service from the City and from owners of multi-family properties.
Currently, there are 59 affected properties with a total of $117,086.52 in delinquent charges, which includes $112,179.32 in unpaid sewer and water charges, $2,950 in administrative fees to the City and $1,957.20 in administrative fees to Alameda County Assessor’s Office, as listed on Attachment III. It is anticipated that the final list of properties and amount of delinquent water and sewer charges will be reduced by the final due date of August 1, 2025. Recovery of these outstanding charges improves the fiscal health of the Water and Wastewater Operating Funds, which benefits all rate payers.
BACKGROUND
The City provides water and sewer services to almost all residents and businesses within the City limits. The exceptions are a small number of properties that receive water service from the East Bay Municipal Utility District or sewer service from Oro Loma Sanitary District. In addition to in-City customers, Hayward provides sewer service to about 970 “sewer-only” customers, mainly located in unincorporated Alameda County, as well as water or sewer service to other customers outside of the City limits. The Hayward Municipal Code states that responsibility for water and sewer bills lies with the person or
entity that requested service, i.e., the account holder of record. For sewer-only accounts, however, ultimate responsibility rests with the property owner, regardless of the name on the account.
For accounts that become subject to collection, the most effective measure available to the City is to discontinue water service for unpaid charges. However, the City is unable to shut off water to sewer-only customers since water service is not provided by the City. With respect to multi-family customers, discontinuing water service would leave tenants without water, in most cases through no fault of their own. On November 27, 2012, City Council approved ordinances allowing for the collection of delinquent water and sewer bills as special assessments on property tax bills. The ordinances apply to accounts that are at least sixty days in arrears as of March 1, 2025, and provides the City with a tool to collect delinquent charges from property owners that receive sewer service only from the City and from owners of multi-family properties. The ordinances are intended for use as a last resort, in addition to remedies that already exist.
DISCUSSION
Delinquent water and sewer service charges that would be placed on the property tax rolls for each customer are comprised of all charges in arrears by sixty days or more as of March 1, 2025, a $50 administrative fee charged by the City, and a 1.7% administrative fee charged by the Alameda County Assessor’s Office.
As of the date of this writing, there are 59 affected accounts that have a total of $112,179.32 in unpaid sewer and water charges, plus an additional $2,950 in administrative fees to the City and $1,957.20 in administrative fees to Alameda County Assessor’s Office, for a total of $117,086.52, as listed on Attachment III. If not paid by August 1, 2025, the unpaid charges and administrative fees will become a special assessment against the property and will appear on each property owner’s tax bill later this year.
To give the City Council a sense of the impact of the ordinance, the first formal letter was sent to 98 account holders, with total delinquent charges of $187,820.07, where approximately 62% of the charges were owed by two customers. The attached list includes 59 account holders, with charges totaling $112,179.32, excluding City and County administrative fees, of which 57% of the charges are owed by two customers. This means that $75,640.75, or approximately 40% of the original unpaid charges, has been collected that otherwise may not have been paid.
By comparison, at the same time last year, there were 96 affected accounts with an outstanding balance of $96,571.73, and in the previous year, there were 90 affected accounts with an outstanding balance of $122,701.46, excluding City and County administrative fees.
As seen in previous years, some property owners paid off their delinquent balance after City Council action. The final list that will be transmitted to the County Assessor may be smaller than the list provided in Attachment III. The final list transmitted to the County
Assessor last year included 41 account holders with an outstanding total balance of $25,096.52, excluding City and County administrative fees.
Staff mailed three formal notices to each affected property owner in March, April, and May.
Property owners were provided with an opportunity to schedule an administrative hearing if they disagreed with the charges or their responsibility for paying them. No requests for hearings were received.
ECONOMIC IMPACT
The properties that are affected by this action are summarized in the following table:
Amount Owed
(Excluding Administrative
Fees)
Number of Parcels
Less than $500 25
$500 - $1,000 25
$1,000 - $2,000 2
$2,000 - $10,000 3
More than $10,000 3
Total: $112,179.32 59
To the extent that we recover and discourage delinquencies, all rate payers will benefit from slightly less overall future rate increase requirements.
FISCAL IMPACT
There is no negative fiscal impact to the City as cost recovery occurs through administrative fees. Recovery of these outstanding charges improves the fiscal health of the Water and Wastewater Operating Funds, which benefits all rate payers.
STRATEGIC ROADMAP
This agenda item is a routine operational item and does not relate to one of the City Council’s Strategic Roadmap.
SUSTAINABILITY FEATURES
There are no direct sustainability features associated with this report.
PUBLIC CONTACT
In addition to the three notices sent directly to property owners, a notice of the City Council’s scheduled confirmation of this report (Attachment IV) will be published twice in The Daily Review in June 2025.
NEXT STEPS
The City will continue to accept payments until August 1, 2025. After that date, the list will be finalized and forwarded to the Alameda County Assessor’s Office by August 8, 2025, in accordance with the County’s schedule.
Prepared by: Michelle Tran, Developmental Review Specialist
Recommended by: Alex Ameri, Director of Public Works
Approved by:
________________________________________
Michael Lawson, J.D.
Acting City Manager