Mayor Issues Order to Collect Unpaid Debts

Los Angeles Mayor Antonio Villaraigosa issued a directive Oct. 20 outlining for department heads how to collect unpaid bills. The mayoral order instructs that delinquent accounts be referred to outside collection agencies or the collection unit in the city finance office after 45 days; review and implement measures to apply penalties and interest to unpaid accounts; submit quarterly reports on accounts receivable; and submit reports on uncollectible accounts for write-off to the Board of Review. The directive does not apply to Los Angeles World Airports, the Department of Water and Power, the harbor, City Employees’ Retirement System, and fire and police pensions. Collecting on unpaid debts has been championed by the Valley Industry & Commerce Association as a way to reduce a budget deficit estimated at $406 million without having to cut services or raise fees. Villaraigosa’s directive, similar to one issued in 2005, does not address accountability in the city but only the old debts. “They did not go as far as we had hoped with a separate department but it was a good first step,” said VICA President Stuart Waldman. In a June 2007 report, City Auditor Laura Chick found that that approximately $502 million in bills had gone uncollected, including large amounts from more than five years ago. The unpaid bills include ambulance transportation fees, industrial user permits, police response to false alarms, and expediting planning department cases.