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City adjusting late fees on water bills

Many city water customers who paid their bills on time have been charged modest late fees over the past couple of years, officials disclosed last week.

The problem is being blamed on a brief lag in the time it takes some payments to be processed by the company that runs the water system. Checks sent to a post office "lock box" or dropped off at the city treasury on the day they're due don't reach American Water Services until after the cutoff.

People who mailed or delivered checks directly to the company's Exchange Street office were not charged penalties if they met payment deadlines, unless checks were left in an overnight box on the date they were due.

Water officials said they were unable to pinpoint how many such customers were charged interest fees that typically ranged from $1 to $2 per month for residential accounts, but they conceded that hundreds of property owners may have been affected since at least 2004.

Buffalo homeowner Jeffrey Tooke is among them. "It's not about the amount of money involved," said Tooke, who once worked for city government. "But if it happened to me, it probably happened to a lot of other people over the past couple years."
When he noticed an unwarranted late fee on his water and sewer bill last summer, he contacted the city comptroller's office. Staffers raised questions, and last week, the Water Board took steps aimed at correcting the problem.

The board voted to authorize American Water Services to wait three business days after water bills are due before tagging on interest charges.

The three-day grace period should allow payments submitted by due dates to be processed without incurring late fees, said Shirley Hunter, American Water's customer service manager.

"I guess it's a nice gesture, but they should just fix the problem," said Tooke. "It should be based on the day of the transaction. I don't understand why it can't be done that way."

Hunter said the bill-processing system does not take into account the transaction date, only the payment-processing date. Some officials said adding a new step to the process could compound staffing problems and cause other problems.

Tooke's complaint triggered a one-year refund of interest fees that he said amounted to about $8 for both water and sewer charges.

Hunter said any additional requests for refunds would be dealt with on a case-by-case basis. The city charges a 1.5 percent fee per month on late water bills.


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