By Mark Squibb | May 20, 2021
The Town of Paradise is out over $47,000 in unpaid recreation fees.
The money, $47,528.27 to be exact, accounts for receivables that went uncollected from 2014-2017.
Deputy Mayor Elizabeth Laurie noted that outstanding accounts are reviewed annually, and that only when all the options for collection are exhausted will the town write off accounts, and that the annual budget includes an allowance for uncollected fees.
The recommendation, made by Laurie and seconded by councilor Stirling Willis, was to write off the accounts.
Councilor Kimberly Street asked if the town had done a comparison to see if there had been a decrease in unpaid fees in the years since 2017.
Mayor Dan Bobbett agreed it is something council could look into.
Council Alan English had a number of questions.
“I certainly agree that receivables of this age, are extremely unlikely to be collected, and should be written off, but I’m not clear on a couple of other things,” said English. “One is the magnitude of accounts receivable for recreation. I always thought that recreation was a ‘pay-as-you-go’ operation. You book, something, you pay for it, and you go on. I just don’t understand how we would have receivables of $48,000 plus, in Recreation.
“I’m not clear on why it took so long for the problem with these receivables to be realized,” English added. “The first inkling that I had that there was a problem with receivables was when the audited financial statements for 2019 were presented for approval in December of 2020. At that time I had asked only one question, which was why the allowance for accounts receivables had gone up by $166,000. And I can’t remember the exact words that were used to explain it, but it was referred that the receivables were related to Recreation, and that’s why the allowance for accounts was gone up by $166,000. But I’m still not really sure why we’re dealing with this in 2021.”
English said it would be a miracle if anyone would pay a receivable dated from seven years ago.
“I would also like to get a better understanding of the current status of the other receivables, around a $118,000, in addition to the $48,000, which were also included in the 2019 audit to make up $166,000,” he said. “I don’t know if the $166,000 expenses in 2019 entirely relates to Recreation, but presumably, if there’s $48,000 that are problematic now, I’m just wondering about the other $118,000? Are they ready to be written off as well?”
Terrilynn Smith, Director of Corporate Services, said there were several factors accounting for the lag, including a change of staff in the financial area, a large number of events that were being held in advance of payment and the ongoing work of exhausting other methods of collection.
English hoped that, going forward, council will receive a receivable listing on a regular basis to catch any problems that may be creeping up.
“I would hope that we are doing that in this point in time, and unfortunately, it appears that that was not the case back then,” said English.
Smith noted there is a system in place now whereby receivables can be reported regularly, and that there have been changes to rental policies.
Councilor Patrick Martin added that events were no long being held in advancement of payment.
“Staff reassured us that anybody renting a facility had to pay a month in advance,” said Martin. “So, if you pay a full month in advanced, we’ll be seeing none of this in the future, I don’t think.”