After collecting more than $260,000 in outstanding municipal court fines from deadbeats through a collection agency, the city has renewed its contract with Milwaukee-based debt collector Professional Account Management earlier in the month.
The debt collector charges 22-percent to delinquent individuals resulting in “no out-of-pocket cost” to the city. The company was awarded a two-year contract on February 9th, 2016 with the option to renew for two more years, according to city records.
Seven companies submitted proposals for the contract. Professional Account Management collected more than $260,000 in outstanding fines that go back to 1989 over the past three years, said municipal court officials late last year.
“I don’t like leaving money on the table,” said Kenneth Morris, councilman at-large. Court officials have said without the collection agency the city would not have been able to collect a dime.
Julio Tavarez, 5th Ward councilman, expressed concerns the city may place its poor residents in debt traps. Ruby Cotton, 4th Ward councilwoman, wanted to know how much was collected by the company the previous year.
Both Tavarez and Cotton voted against approving the contract. The collection agency has created a new revenue stream for the city.
The company does not receive any payments from the city for collecting debt. “If they don’t collect the debt, they don’t get paid,” said Morris He said the collector has a good record in going after those who do not pay parking tickets, criminal fines, moving violations, and other municipal court penalties.