City of Hillsboro discusses utility deposit system

The Hillsboro City Council met on Tuesday, April 20 and discussed the utility deposit system. Council member Brent Driggers was absent.

“Currently if a customer cannot produce a letter of credit from a previous utility they are required to post a $125 deposit. The deposit is held for one year or until the utility service is discontinued. Deposits are refunded with interested earned at the end of the year. If someone discontinues service and leaves without paying their final bill the deposit is credited to the outstanding balance,” said City Administrator Matt Stiles.

Stiles went on to explain that bookkeeping for the deposits requires a significant amount of monthly paperwork and never balances out. He said that state statute requires that the city pay customers an interest rate on their deposits that is set by the Kansas Corporation Commission.

“Often the rates set by the KCC are higher than what the city can get on its deposits. The amount of hassle for utilities deposits have made many utility systems to move away from them. Our auditors also recommended and support the move away from the utility deposit structure,” said Stiles.

Stiles proposed an ordinance to eliminate the deposit and require new services to pay a flat $50 utility connection fee. He said that the fee can be waived with a letter of credit from previous utility provider, the same procedure we use for the current deposits.

“Additionally, the ordinance increases the fee for reconnection for failure to pay. The current fees are $10 for reconnection during business hours and $25 after hours. The fees are not sufficient to cover the manpower and resources used for the reconnections and are out of line with other utilities. The ordinance changes the reconnection fee to $50 regardless of time. A $50 fee is equal to neighboring utilities and better covers the cost of sending crews out,” said Stiles.

The council voted to eliminate the deposit system to reduce the staff time needed to account for the deposits, reconcile and manage. Stiles explained that there are 193 deposits that would be returned as part of this action.

City Engineering Services

Stiles explained that several city staff interviewed four engineering firms on April 13. The firms were Schwab-Eaton (Wichita), MKEC (Wichita), PEC (Wichita) and EBH (Marion/Hillsboro). Based on the interviews and the information provided in the proposals, the staff is recommending that the city pursue a one-year agreement with EBH for city engineering services.

This decision was made because EBH has had a relationship with the city for 20 years and successfully completed numerous projects.

“In recent years there have been concerns raised about EBH meeting deadlines and communication with the city. The EBH presentation acknowledged those issues and proposed some changes to their current operations to better meet the needs of the city. Most significantly EBH is hiring mores staff to service in the Hillsboro and Marion offices. EBH plans to maintain regular and consistent hours at the Hillsboro office. They are also proposing improved project management processes that will create measurable milestones and accountability while also incorporating more communication with the city,” said Stiles.

A one-year engineering services agreement for an on-call arrangement was recommended. EBH has provided a draft services agreement, however the City Attorney will need to review and revise before final approval by the council. The on-call arrangement does not include a retainer. The city will get charged for services used based on a set rate schedule.

The council approved the City Attorney to draft the agreement.

Scam Alert

Stiles cautioned that unidentified individuals were following along the TCW fiber project path attempting to sign-up customers for “fiber internet.” He warned that residents need to be aware that some salespeople are not with TCW and aren’t selling true fiber service.

“Any representative with TCW will be wearing branded clothing, in TCW identified vehicles and have the TCW logo on the paperwork,” said Stiles.

KPP Video

The council watched a video made by Mark Chesney, CEO/General Manager for Kansas Power Pool (KPP). Chesney developed the video to explain the February winter storm and the impact on the power industry. The video can be viewed at and can also be found on the city’s facebook page.

In other business, the council:

n learned that HHS Darrel Knoll’s Senior Government classes are developing project proposals to improve the community. Mayor Lou Thurston, Economic Development Director Anthony Roy and Stiles have presented to the classes and are helping craft the proposals. A panel will hear the presentations in the high school auditorium on May 5.

n was informed by Stiles that the city has been pursuing a collaboration between entities in the community (Tabor, USD 410, Chamber, Museum, CVB, HDC, city) to have a coordinated marketing strategy. This is part of the economic development initiatives the city has been working on. The first meeting was last week. Stiles reported feeling that “it was a really positive meeting and felt like we left with some solid ideas that work well with the city’s strategic planning efforts and potential mission/value statements.”


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