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City writes off $500,000 in debt

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Taxpayers aren't impacted by the city's decision to write off more than $500,000 in bad debts, council was assured Monday.
The uncollectible revenues, comprised of both unpaid property taxes and outstanding city fees dating back decades, were formally removed from the books in a unanimous council decision.
"This doesn't affect anything going forward," Mayor Walter Gray said, since the debts were assigned to the year in which the various accounts were deemed to be uncollectible.
And Gray said the outstanding debts, given the city has an annual budget of about $400 million and bills $26 million a year in fees and charges, represent a small share of the overall financial picture.
"Most businesses would be very envious of the City of Kelowna's," ability to collect what it's owed, Gray said.
Nevertheless, several councillors wanted reassurance the city's finance department is taking measures to reduce the amount of uncollectible revenues in the future.
"I know that for a corporation of this size this isn't a lot of money, but it is a lot of numbers for me as a person," Coun. Mohini Singh said.
George King of the finance department said more rigorous credit checks are now being run on companies that seek to have an ongoing account with the city. And pre-authorized payment plans should also help to lessen the risk of uncollectible revenues piling up over time, he said.
Almost $100,000 of the unrecoverable debt relates to a failed development on Okanagan Indian Band land that's within the city's far northern boundary.
A further $400,000 is accounted for by various fees never successfully collected by the city's real estate, landfill, and airport divisions.
In many cases, the debtor declared bankruptcy and there simply isn't any way to recover the money the city is owed, council heard.

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