Overdue utility bills mount in L.A.
Terry Holtzman has watched his income sour in recent months as the plummeting housing market pushed much of the Southland's economy to the verge of recession.
And now, when the Woodland Hills construction worker has less to spend, rising prices for everything from food to fuel have intensified the squeeze on money for even the most basic of needs: such as keeping the power on at home.
"It's tightening up my budget," Holtzman said as he waited to pay his $350 Department of Water and Power bill at a Winnetka customer service center last week. "I'm not being able to pay my bills in full for whatever bills I have.
"I'm pretty shaken up, fearful. It's nerve-racking."
Holtzman's worries are being echoed across Southern California. The DWP and other utility companies say growing numbers of people are falling behind on their water and power bills.
DWP officials said 358,374 customers - nearly one in four of the 1.4 million the utility serves - had overdue bills in May. That was 13 percent more customers with overdue bills than in May of last year, officials noted.
The vast majority of the 358,374 - about 293,000 of them - were homeowners, according to DWP records. But overdue accounts of apartment dwellers also surged - up 40 percent from a year ago to 22,251.
"I think people are feeling the pinch of a difficult economy. They feel very uncertain," said DWP General Manager H. David Nahai.
"When you have a
Nahai said the utility is closely watching the trend and moving to hire and train workers to help customers meet their payments.
Nahai said the utility's write-off rate has climbed only about 0.1 percent over past year, which will cost the DWP an extra $1 million or so. He said the rate is still less than the industry average.
And he said the public utility, which charges a 1.5 percent monthly late fee, wants to try to avoid cutting off service.
Disconnections on average have been dropping since Nahai took over: Service was cut off to about 2,160 customers in each of the last four months, compared with about 3,460 per month in the same period last year.
"While disconnecting is a last resort, it's truly unfair to ratepayers as a whole to allow abusers to get away with it, and we'll concentrate to make sure that doesn't happen," Nahai said.
Jack Kyser, chief economist with the nonprofit Los Angeles County Economic Development Corp., said the leap in late payments reflects how squeezed families are finessing their budget calculations.
"I think people feel the utility would be easier to deal with, that they might not come down so hard," said Kyser, noting utilities in the region don't move to cut off customers until after about 50 days.
"The banks would move more quickly to try to get the situation under control," he said, when payments are late on credit card debt or home or car loans.
Overdue utility bills also reflect how difficult the balancing act has become for middle- and lower-income families, he said.
"They're in a vise and don't know when it will ease," Kyser said. "They're paying more for gas, food. We don't know what the housing situation is, and of course they have utilities to pay.
"In many cases they're really stuck and don't know what to do. It's easier to let the utility bill slide and then catch up, especially if they're facing a big jump in variable-rate mortgage payments."
Rebecca Robins, a Stevenson Ranch financial planner, said it may be difficult for customers used to making spontaneous purchases to adjust to tight budgets.
"People generally have their priorities mixed up in a consumption society. We forget shelter, food, clothing. People don't think of utilities," Robins said.
"But this will mushroom. People don't realize it. They'll get so far behind and have to play catch-up."
Not all utility costs are pushing ratepayers to the brink.
While natural-gas prices with Southern California Gas Co. have bumped homeowners' average summer monthly bills from about $31 last year to between $40 and $50 this year, delinquent payments have remained about the same, said spokeswoman Rachel Laing.
"Basically, natural-gas bills aren't as high as electric bills," Laing said.
Outside the city of Los Angeles, Southern California Edison's late accounts also have risen - along with disconnections.
There were 501,610 Edison customers behind on their bills in May, compared with 487,000 at the same time a year ago. About one in every 10 of Edison's 4.8 million customers was behind on payment.
And disconnections in the first five months of this year were up 14percent over the same period last year: 165,000 compared with 145,000.
Edison spokesman Gil Alexander said the utility disconnects after 51 days - about the time the average bill hits $154 - and only after efforts have been made to work out payment strategies.
"We see our jobs as leaving the lights on, not disconnecting customers," he said.
Still, higher power-plant fuel costs passed on to consumers - along with rate hikes at some utilities and rising summer temperatures - have made it tougher for customers on tight budgets.
Ona Martin, 76, of North Hollywood, drove to the DWP service center in Winnetka last week to save on postage and to make absolutely sure she wouldn't be hit by a late fee.
Martin, who works on computers and telephones, was paying a $700, two-month DWP bill despite running only her window air conditioners.
"The prices keep going up and up and up; they never give up," said Martin. "The reason I keep working is because I want to keep up with the economy."
beth.barrett@dailynews.com 818-713-3731
fonte: Daily News
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