COUNTY OF SAN MATEO
Inter-Departmental Correspondence

Employee and Public Services Department

DATE:

October 20, 2005

BOARD MEETING DATE:

November 8, 2005

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Mary Welch, Director of Employee and Public Services
Girdie Bernard, Division Manager, Revenue Services

SUBJECT:

Request for Relief of Accountability of Delinquent Accounts

RECOMMENDATION

Adopt a resolution authorizing the abandonment of collection effort and relief of accountability for certain San Mateo County accounts receivable as follows:

• $4,999,815.31 for indigent care provided by the Medical Center

• $720,824.07 for Court cases

• $562,505.81 for Human Services Agency Cases

• $59,305.36 for collections for various other departments

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government

Goal #20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

Revenue Services has consistently provided quality collection services for the County at a cost which is lower than companies in the private industry.

BACKGROUND

The Revenue Services Division is responsible for collecting monies for services rendered or for fines against persons who do not make payment. Typical collection accounts include court fines, medical and clinic services, welfare over-payments and private defender fees.

The Government Code provides that the County can seek relief from collection efforts for uncollectible accounts by writing off uncollectible debts after collection efforts are unsuccessful. County Administrative Memorandum Number D-10 provides that such accounts be taken to the Board of Supervisors to request relief. Per County policy, we are now submitting our write-off request for fiscal year 2004-05.

DISCUSSION

Accounts presented for abandonment for FY 2004-05 fall into six categories of uncollectibility. These are:

• Accounts that are too small to warrant further collection efforts. Examples include: initial account balances that are too small; and remaining balances on accounts that are too small. The uncollectible funds in these accounts for fiscal year 2004-05 total $13,840.56. There are no uncollectible funds in accounts over $10,000.

• Accounts lacking sufficient information for collection. Examples include: clients identified by name and general delivery address but without any other information; and clients who have moved and cannot be located. The uncollectible funds in accounts under $10,000 for fiscal year 2004-05 total $86,110.39. The uncollectible funds in accounts over $10,000 total $33,048.14.

• Accounts on which all collection efforts and options have been exhausted. Examples include: accounts that have aged beyond the statute of limitations for collection; and accounts that have been worked by Revenue Services staff and then referred to outside collection agencies and returned as uncollectible. The uncollectible funds in accounts under $10,000 for fiscal year 2004-05 total $5,275,127.31. The uncollectible funds in accounts over $10,000 total $136,512.41.

• Accounts for which the client has no resources to pay. Examples include: clients who have died and left no estates; clients who have died and left insolvent estates; and clients who are bankrupt and have no attachable assets. The uncollectible funds in accounts under $10,000 for fiscal year 2004-05 total $80,924.80. The uncollectible funds in accounts over $10,000 total $133,210.81.

• Accounts that, if further collection efforts were pursued, would place the client in extreme hardship. Examples include: clients who are Medically Indigent Adults; and clients who would become destitute as a result of making payment. The uncollectible funds in accounts under $10,000 for fiscal year 2004-05 total $2,183.75. The uncollectible funds in accounts over $10,000 total $11,981.26

• Accounts that were erroneously established and billed at the point of service. Examples include: clients who received services while incarcerated; and clients who received care or services while they were minors. The uncollectible funds in these accounts under $10,000 through fiscal year 2004-05 totals $7,005.31. There are no uncollectible funds over $10,000 for FY 2004-05.

Attachment A provides a detailed listing of recommended write-offs by type of account and department.

Attachment B provides details on each of the 18 accounts over $10,000 recommended for abandonment.

Human Services Accounts

By virtue of the age and condition of the accounts, there is little chance of recovery of the $562,505.81. Of this amount, $66,033.42 is for Food Stamp over issuances of which the County share is zero. The remaining $496,472.39 is for AFDC overpayments of which the County share is 2.5%, or $12,412.

Pursuant to the Terms of Government Code section 25258(b), the names of the assesses or persons liable and the amounts owed by each is incorporated by reference in this application are permanently maintained in the office of the Board of Supervisors for the County of San Mateo.

By signature above, we hereby verify, on information and belief, that the facts stated herein are true and correct.

Fiscal Impact
By virtue of the age and condition of the accounts, there is little or no chance of recovery of the write-offs. The accounts are not included in the amount provided to the Controller as collectible and thus will not affect the County's financial statement.

Revenue Services:

Uncollectible Accounts for Write-Off Accounts Under $10,000

Court

Health Dept.

SMC

Hospital

Misc.

Private

Defender

Private Defender Juvenile

Cost of Collection is Too Great

$11,116.71

$0.00

$0.00

$0.60

$67.86

$1,082.94

Lacking Sufficient Information to Collect

$63,902.93

$200.00

$1,758.48

$0.00

$3,592.00

$1,485.00

All Options Exhausted

$546,124.70

$0.00

$4,669,924.18

$0.00

$7,265.63

$270.00

No Resources to Pay

$49,624.00

$0.00

$6,374.72

$0.00

$12,082.85

$417.50

Erroneously Billed

$0.00

$0.00

$7,005.31

$0.00

$0.00

$0.00

Hardship

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

TOTAL

$670,768.34

$200.00

$4,685,062.69

$0.60

$23,008.34

$3,255.44

Sheriff

Probation

Human Services

Superior Court

Total

Number

of Cases

Average

per Case

Cost of Collection is Too Great

$80.00

$356.13

$0.00

$1,136.32

$13,840.56

228

$60.70

Lacking Sufficient Information to Collect

$50.00

$532.93

$0.00

$14,589.05

$86,110.39

315

$273.37

All Options Exhausted

$15,513.00

$9,681.79

$1,989.38

$24,358.63

$5,275,127.31

24,506

$215.26

No Resources to Pay

$2,454.00

$0.00

$0.00

$9,971.73

$80,924.80

269

$300.84

Erroneously Billed

$0.00

$0.00

$0.00

$0.00

$7,005.31

1

$7,005.31

Hardship

$0.00

$2,183.75

$0.00

$0.00

$2,183.75

7

$311.96

TOTAL

$18,097.00

$12,754.60

$1,989.38

$50,055.73

$5,465,192.12

25,326

$215.79

Revenue Services:
Uncollectible Accounts for Write-Off Accounts Over $10,000

SMC

(Medical Center)

Total

Number

of Cases

Average

per Case

Cost of Collection is Too Great

$0.00

$0.00

0

$0.00

Lacking Sufficient Information to Collect

$33,048.14

$33,048.14

3

$11,016.05

All Options Exhausted

$136, 512.41

$136,512.41

6

$22,752.06

No Resources to Pay

$133,210.81

$133,210.81

8

$16,651.35

Erroneously Billed

$0.00

$0.00

0

$$0.00

Hardship

$11,981.26

$11,981.26

1

$11,981.26

TOTAL

$314,752.62

$314,752.62

18

$17,486.26

Write Off Amounts in Excess of $10,000

There are 18 cases in excess of $10,000 that are being recommended for abandonment. These 18 cases fall into four general categories:

• Cases for which collection efforts have been exhausted and that have passed the legal time period during which collections can be made. There are 6 of these cases. The total for these cases is $136,512.41.

• Cases for which the client has no ability to pay. There are 8 of these cases.
The total for this case is $133,210.81.

• Cases that lack sufficient information to continue collection efforts. There are 3 of these cases. The total for these cases is $33,048.14.

• Cases that, if pursued, would cause the patient an extreme hardship. There is 1 case. The total for this case is $11,981.26.

Cases For Which All Collection Efforts Have Been Exhausted and That

Have Passed The Legal Time Period During Which Collections Can Be Made (6)

The Revenue Services Division has made extensive efforts to collect the monies on the accounts in this category. After exhausting all avenues available to the division, these cases were referred to an outside collection agency for additional collection efforts.

The outside agency has also been unsuccessful in collecting on these accounts.

The ability of the debtor to make payment on these cases is statutorily limited and the time period during which collections can be made has expired.

Number 1245557 $12,304.25

Current address coded as mail return with no forwarding address. No employment information available, no credit profile found, no real property or attachable assets.

Current whereabouts unknown.

Number 1278069 $12,242.18

Mail return, no forwarding address. Phone disconnected, no credit information, no employment information, no attachable assets.

Current whereabouts unknown.

Number 1235803 $12,131.53

Debtor incarcerated. No credit profile found, no insurance. No attachable assets.

Number 563829 $10,372.86

Debtor unemployed. No credit information available, no property ownership listed.

No attachable assets.

Number 1305573 $25,974.72

Number 1305678 $63,486.87

Debtor is self-employed with no income. Debtor applied for medi-cal assistance but was denied. Credit report is negative, no real property listed.

Current whereabouts unknown.

Cases For Which The Client Has No Ability To Pay (8)

These cases represent clients who have no assets and have no ability to pay. There are 15 of these.

Number 1246481 $27,511.18

Debtor died. No attachable assets and no estate.

Number 1269491 $22,322.44

Debtor died. No attachable assets and no estate.

Number 11312793 $11,291.76

Debtor died. No attachable assets and no estate.

Number 1278866 $11,870.53

Debtor filed no asset bankruptcy. No attachable assets.

Number 1329815 $10,947.06

Debtor died. No attachable assets and no estate.

Number 1332485 $23,140.72

Debtor died. No attachable assets and no estate.

Number 1341841 $14,349.62

Debtor died. No attachable assets and no estate.

Number 1253922 $11,777.50

Debtor died. No attachable assets and no estate.

Cases Lacking Sufficient Information to Continue Collection Efforts (3)

Number 1041140 $11,481.21

No responses to numerous notices. No credit information, no property ownership listed.

Current whereabouts unknown.

Number 1246448 $10,220.93

Debtor 80 years old. No response to notices. No credit profile found, no property ownership listed.

Current whereabouts unknown.

Number 1179878 $11,346.00

No responses to numerous notices. No credit information, no property ownership listed.

Current whereabouts unknown.

Cases That If Pursued Would Cause the Debtor an Extreme Hardship (1)

Number 1307919 $11,981.26

Debtor is not working and has chronic alcohol problem. Debtor has no insurance. Further collections would cause undue hardship.