7-1402: Relief of Accountability - Accounts Receivable

Purpose

This policy establishes uniform guidance for reporting uncollectable or adjusted accounts receivable resulting in a request for Relief of Accountability (ROA). In an effort to promote uniformity and consistency amongst departments and agencies, this policy is established to ensure that reasonable effort occurred to collect unpaid funds and accounts receivable and that the process for seeking relief is conducted in an efficient and systematic manner.

Authority

• The Board of Supervisors Resolution #99-0158

Scope

This policy applies to all Sacramento County Departments.

Policy

Procedures

It is the policy of the County of Sacramento that all matters related to the write-off of unpaid funds and accounts receivable are referred to and processed by the Department of Finance, Revenue Recovery Division (Revenue Recovery) in order to minimize the loss of revenue to the​County. Revenue Recovery acting as the collection agency for the County seeks payment and when the accounts receivable are deemed uncollectable Revenue Recovery will process the required ROA. Revenue Recovery will keep departments informed of the collection status and the accounts receivable included in ROAs submitted for approval to the Board of Supervisors (Board). 

When granted by the Board, the ROA is the official process to relieve a department from its obligation to pursue and collect unpaid funds and to adjust and reduce accounts receivable. The granting of ROA does not always relieve the debtor from his/her liability to pay nor does it extinguish the debt. 

Board Resolution #99-0158 establishes the policies that govern Revenue Recovery, its permits departments and agencies to refer uncollectable funds to Revenue Recovery for ROA. Reasons for ROA are delineated in the Board Resolution. Some examples deemed uncollectable include: debtor is deceased; the debt is legally uncollectable due to bankruptcy or other legality; or the debt is uneconomical to pursue because the cost of collection would exceed the amount recovered. 

Further, the Board Resolution authorizes Revenue Recovery to adjust or compromise accounts according to the financial condition of the debtor, where the material facts surrounding the occurrence of the debt indicate inappropriate or inequitable charges for services rendered, or when such compromise is in the best interest of the County. 

Amounts compromised or adjusted are included in Revenue Recovery's requests to the Board for ROA. The Department of Finance, Auditor­ Controller Division reviews the amounts submitted by Revenue Recovery to ensure they meet write-off criteria before being submitted to the Board for approval. 

Revenue Recovery will assist departments and agencies with implementation of the policy and will coordinate with departments and County Counsel to support any business needs or lawful exceptions relating to unpaid funds that may be impacted by this policy. 

Departments shall maintain internal procedures consistent with all County policies.