Saturday, December 15, 2012

Alabama AG To City Water Authority: Cough Up Refunds For Improperly Clipped Cash From Buyers Of Foreclosed Homes To Pay Off Ex-Owners' Unpaid H2O Bills

In Fayetteville, Alabama, The Daily Home reports:

  • The Fayetteville Water Authority has been refunding residents for unlawful charges they received after moving into foreclosed homes. The authority charged new residents of foreclosed homes the water bill balance previous owners left unpaid.

    To have their water meters turned on, new residents had to first pay in full the balance of the previous owners.

    “Our attorney advised us and the ruling was made that it was legal,” said Fayetteville Water Authority chairman Doug Blair. “And the people that made the foreclosures didn’t agree with us so we asked for the attorney general’s opinion and it didn’t come back in our favor.”

    Blair said the water authority was advised by its attorney, Barry D. Vaughn, that what they were doing was legal, but after customers came in with complaints against the charges, they sought the opinion of state Attorney General Luther Strange.

    In a letter from Vaughn to Strange on behalf of the Fayetteville Water Authority, the following question was posed: “If a bank forecloses on a house and the water meter has been locked off for non-payment under the rules and regulations of the Water Authority, is it lawful and does the Water Authority have the right to refuse to unlock the meter at this residence until the bill has been paid?”

    In a formal opinion letter sent back to Vaughn, Strange concludes: “The Fayetteville Water Authority cannot deny or discontinue water service to a new owner of property purchased at a foreclosure sale for the delinquent charges of a former owner.”

    “We’re not out to do people wrong and do things unlawful,” Blair said. “I said that if we were wrong we would make amends for it.”

    The water authority has already taken steps to amend the situation, which involves refunding a total of about $7,000 to residents that were charged for the previous owner’s water bill balance.

    Reimbursements were listed as “foreclosure refunds” and approved recently at the water authority’s meeting.

    The refunds ranged from $330.48 to $19.08 for a number of residences, businesses and banks in the area.

    “We’re not there to do wrong and we assured our water customers that if what we were doing was not lawful we would do what was correct and that’s what we’re doing,” Blair said.

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