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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> Elk River Municipal Utilities Commission Jennie Nelson—Customer Service Manager <br /> John Dietz—Chair <br /> Al Nadeau—Vice Chair <br /> Daryl Thompson—Trustee <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> November 17, 2015 5.5 <br /> SUBJECT: <br /> Review of Security Deposit Policy and Credit Card Procedures <br /> BACKGROUND: <br /> A recent commercial customer experience has led staff to look into the Security Deposit Policy <br /> and our credit card procedures. <br /> DISCUSSION: <br /> The current security deposit procedure for commercial customers directs staff to estimate two <br /> months of charges and bill that as the deposit on the first bill. Recent customer experiences have <br /> shown that there is some risk in this. The first issue is that for new businesses, the deposit <br /> amount is hard to estimate. If the deposit is not an accurate two months of charges,we don't <br /> currently have a way to increase that after a few months have billed and history is established. <br /> We could bill the increase,but the customer could stop paying and the increase in deposit dollars <br /> would never get paid. We also could require the deposit to be prepaid before the account is setup, <br /> however for most commercial buildings; we don't have a lot of leverage to disconnect without <br /> shutting other businesses off if the customer does not prepay. We have that same challenge with <br /> disconnecting for non-pay. <br /> Another option, in addition to the deposit, would be to strengthen our commercial service <br /> agreement and/or ask customers to sign a personal guarantee. Many businesses register as a <br /> Limited Liability Company which takes the liability away from the specific person or owner,but <br /> if that isn't the case and we did have a social security number for the owner, that could give staff <br /> leverage for collections if the account has bad debt. <br /> Staff has also had some difficult experiences recently with credit card chargebacks. Currently, <br /> any residential or commercial customer is able to use credit cards with no extra charge. We have <br /> had great success collecting money through credit cards that we likely would not have been able <br /> to collect through other payment methods. Our write offs have decreased and our customers <br /> greatly appreciate this option. <br /> POWERED BY <br /> Page 1 of 2 NATURE <br /> Reliable Public <br /> Power Provider P POWERED T o SERVE <br /> 149 <br />