News Feature | December 20, 2016

Critics Decry Cleveland Water's 'Aggressive' Policy For Overdue Bills

Sara Jerome

By Sara Jerome,

The Cleveland Division of Water is under fire for what critics see as a harsh way response to delinquent water bills.

Critics say the tactics by Cleveland’s water provider are putting people at risk of losing their home.

News 5 Cleveland reported last week that it did an investigation and found that “homeowners with past due water bills are being targeted — some who owe just a few hundred dollars.”

Cleveland ratepayer Sherri Gordon told News 5 Cleveland: "It just got my blood boiling, because I lost my home because of them." When Gordon failed to pay a bill, which she disputed due to the high balance, she was hit with a $3,000 water tax lien.

Nearly 8,000 Cleveland area ratepayers were hit with tax liens as a result of water division policies over the last three years, according to the report.

“It's a tool that Ohio municipal water departments — unlike gas and electric companies — are granted under Ohio Revised Code to collect past due water bill. And Cleveland's Division of Water is enthusiastically using it — often targeting the sick, elderly and disabled,” the report said.

“In fact, the Cleveland Division of Water has been so aggressive, nearly four times as many homeowners are facing tax liens since 2013,” it continued.

Frank Ford, a housing analyst, told the news outlet that “of 3,651 water tax liens in 2015, one in ten resulted in foreclosure and one in three ended up vacant,” according to the report.

Critics say the policy contributes to the foreclosure crisis and threatens customer’s housing security. Tax liens are a policy the city is pursuing “amid a foreclosure crisis that has generated 25-thousand foreclosures in Cuyahoga County alone since 2012,” the report said.

Cleveland is not alone in responding to unpaid water bills with tax penalties. The Detroit Water and Sewer Department provides customers with online information about a similar policy that it uses. “Paying your entire delinquent balance owing or by entering into a Payment Plan Agreement with the Water and Sewerage Department within the allotted time will prevent the unpaid balance from rolling over to your property taxes,” Detroit explains.

Critics say such policies are unfair. In Detroit, activists say there is a link between water department policies and property tax foreclosures, Michigan Radio reported. The link, the activists say, is that the water department began rolling unpaid water bills into property taxes about a decade ago, and authorities can foreclose on homes with unpaid property taxes, the report said.

Water officials argue that they provide opportunities for ratepayers to settle their accounts before resorting to tax liens. They also argue that water departments face revenue pressures and high costs, and that methods for collecting on delinquent bills are designed to prevent paying customers from subsidizing unpaid accounts.

To read more about how utilities collect overdue water bills visit Water Online’s Funding Solutions Center.