LOS ANGELES NOT RECEIVING ITS DUE SOME $98 MILLION WRITTEN OFF LAST 3 YEARS AS UNCOLLECTIBLE.

Byline: KERRY CAVANAUGH

Staff Writer

Even as Los Angeles leaders cut services to balance the budget, tens of millions of dollars in bills owed to the city were going uncollected, Controller Laura Chick said Monday.

Her audit of L.A.'s billing and collection systems found that some $98 million was written off as uncollectible over the last three years, primarily because the city failed to send bills or follow up on delinquent payments.

"We are potentially losing out on millions of dollars that could hire more police officers and firefighters, fill potholes, trim trees and buy library books, Chick said.

"How can the city of Los Angeles, that has so many unmet needs and demands for services, not care about collecting all the money legitimately owed it?"

Chick listed 35 recommendations, including the creation of a centralized billing system in the Office of Finance and hiring more contractors to collect on unpaid bills.

Under the current system, most city departments handle their own billing, with bills being sent within five days of service, and customers having 30 days to pay.

If the payment isn't received within 45 days, the bill is to be turned over to a collection agency if it's less than $1,000 or the Department of Finance if it's more than $1,000.

But the audit found that departments don't always follow that policy, and the Office of Finance doesn't ensure that departments pursue delinquent bills.

For example, the Fire Department proposed last year writing off $86 million for unpaid emergency ambulance service, with some of the bills dating back to 1997.

While some of those bills probably cannot be collected because they are for uninsured, poor customers, the city should do a better job pursuing bill payment from those with medical insurance, Chick said.

Finance Director Antoinette Christovale concurred with the audit findings and wants to study how to centralize billing within her department.

"The city currently utilizes outside collection agencies to assist with collection on delinquent accounts," she said. "We are considering increasing the number of accounts referred to collection agencies."

Mayor Antonio Villaraigosa said he agrees with Chick's recommendations and directed the Office of Finance to develop in 30 days a proposal to centralize the city's billing system.

kerry.cavanaugh(at)dailynews.com

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