COUNCIL AGENDA REPORT
TO: Mayor and City Council
FROM: Xenia Bradford, Interim Director of Finance
DATE: April 15, 2025
SUBJECT: Adoption of a Resolution Approving Accounts Receivable and Uncollectible Debt Policy
Description:
The City Council will consider adopting a Resolution approving an Accounts Receivable and Uncollectible Debt Policy.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
Adopt a Resolution approving an Accounts Receivable and Uncollectible Debt Policy.
BACKGROUND:
The City of Santa Maria collects revenue for multiple lines of services provided to the community. Services are not limited but may include providing utilities such as water, wastewater, solid waste, landfill, as well as providing recreation and parks and library services. From time-to-time accounts receivable become uncollectible and are written off as bad debt per accounting principles. The City wishes to establish a Citywide Accounts Receivable Policy to ensure a standard method for collections and write -off of uncollectible debt.
DISCUSSION:
The proposed Accounts Receivable and Uncollectible Debt P olicy (Attachment B) establishes consistent application for collections across the City departments in accordance with the best practices. The purpose of th is policy is to establish the responsibilities, internal controls, authorizations and procedures for the accurate and timely preparation of customer invoices for goods and services rendered by the City Santa Maria (City) and the management of the accounts receivable created by these invoices including the authority to write-off uncollectible accounts. This includes ensuring adequate support for all amounts billed, timely collection of outstanding amounts, recording of transactions, reporting of outstanding accounts, and ensuring that practices are consistent throughout the City.
2 Fiscal Considerations
There is no direct fiscal impact associated with the establishment of this policy.
Impact to the Community
The policy establishes best practices for accounts receivable and serves to safeguard the City’s assets and effectively collect payments.
ATTACHMENTS
A. Resolution
B. Accounts Receivable and Uncollectible Debt Policy