The Detroit Water & Sewerage Department (DWSD) is undertaking an aggressive approach to collect on past due commercial accounts, contributing to a collection rate that has increased to nearly 90 percent from 85 percent on January 1.
In the past 90 days, we have changed business practices to improve customer service and utilize industry standards for public utilities. Today, 43,900 commercial and residential accounts are in payment plans. Of those, close to 39,500 residential customers are in payment arrangements, ensuring continued water service. As a result, DWSD improved our collection rate to nearly 90 percent. Noncollectable accounts translate to bad debt which impacts water and sewer rates for the following year. By reducing bad debt, we can lower the water and sewer rate increases.
Under a pilot program with law firm, Kilpatrick & Associates, that we recently launched, DWSD has pursued collections on 40 commercial accounts that are delinquent, an aggregate past due amount of more than $520,000. Several accounts are apartment buildings where the owner has not paid the bill. In these instances, DWSD has committed to not shut off the buildings' water service since tenants are not responsible for the water and sewer bill. The law firm is pursuing collections on the accounts by filing civil action and negotiating on behalf of DWSD to secure payment arrangements. This month, DWSD will give the law firm an additional 220 delinquent commercial accounts which has an aggregate past due amount of $1.7 million.
We have assigned dedicated staff to manage 1,400 commercial accounts with past due bills. In the past 30 days alone, DWSD staff has placed 400 commercial accounts into payment plans. DWSD is making contact with the 1,000 remaining delinquent commercial customers to offer payment plans. Separately, we are negotiating with several large commercial customers, such as Russell Industrial Center, Vargo Golf and the Michigan Department of Natural Resources, which have past due accounts.
Shut-off is the last tool in our toolbox to address past due water and sewer bills -- a tool we try to avoid using by getting more customers in payment plans who have past due balances. Only illegal commercial and residential water hook-ups have been shut-off during the first three months of this year. DWSD will pursue commercial shut-offs in April on accounts that are past due and have not entered into payment plans. No residential customers in Detroit have been shut-off since November unless they are illegal hook-ups.
If customers have difficulty paying their bills, we encourage you to visit www.detroitmi.gov/dwsd for more information, or come to the Eastside Customer Care Center at 13303 McNicohls in Detroit. The hours are Monday - Friday, 8 a.m. - 5 p.m. We also have two additional locations that serve as DWSD payment centers at our main office downtown at 735 Randolph Street (enter at Bates Street) and on the city's westside at 15600 Grand River Avenue.