Straight from the Tap

Controlling costs for all Cleveland Water customers

01/26/2017

Recently, there has been discussion about Cleveland Water’s use of tax liens to recover costs associated with water service. We wanted to take a quick moment to provide some additional context and clarity to an issue that, when portrayed inaccurately or incompletely, can generate unnecessary concern among our customers.

1.  Cleveland Water does not foreclose on people’s homes. Media reports that Cleveland Water takes people’s homes as a result of water debt are not accurate. Twice a year, we have the ability to place liens for outstanding debt with the county where water service is provided. This process involves certifying balances to the county tax bill for collection when individuals pay their property taxes or the property is sold. At no point does Cleveland Water initiate foreclosure actions on a property owner.

2.  Tax liens are used as a last resort. At Cleveland Water, our goal is to keep every single customer in water service. We work hard to keep our rates as affordable as possible, and have held water rates constant in 2016, 2017 and 2018. Additionally, we offer a variety of other programs to help individuals control their costs. But, sometimes people will still fall behind on their water bills. When this happens, we offer payment plans and provide multiple notices to customers that they are at risk of having their water disconnected. It is only after completing all of these other efforts that we will consider placing a lien on a property.

3.  Over the past five years, 1% or less of accounts were liened. Cleveland Water provides a reliable supply of safe drinking water to more than 1.4 million people in nearly 80 communities. In order to do this, we service approximately 420,000 individual properties. A relatively small percentage of these properties are impacted by our lien process. 

Year

Liens

Approximate %

of Total Accounts

2012

1,136

0.27%

2013

1,742

0.41%

2014

2,847

0.68%

2015

2,872

0.68%

2016

4,442

1.06%

TOTAL

13,039

0.62%

 

4.  Liens allow Cleveland Water to help control costs for all customers. A lot of people count on Cleveland Water to provide a reliable supply of safe drinking water at an affordable price. In order to do this in the fairest way possible for all customers, we believe it is important that each customer pay for the water they use. Tax liens are our last resort to do this in many cases. Over the past five years, Cleveland Water has recovered more than $8.5 million through the lien process. 

Year

Lien Amount Collected

Total operating Revenue

% of total Operating Revenue

2012

$960,401

$266,402,268

0.36%

2013

$1,414,314

$273,996,702

0.51%

2014

$1,354,180

$288,150,749

0.46%

2015

$2,449,656

$301,276,197

0.81%

2016

$2,340,838

$308,840,140

0.75%

TOTAL

$8,519,389

$1,438,666,056

0.59%

 

This $8.5 million helps control costs and funds critical aspects of Cleveland Water’s operations including water treatment, distribution infrastructure and customer service.