An Equitable Approach to Debt Collection & Financial Wellbeing

London Breed
Oct 26 · 4 min read

By Mayor London Breed and Treasurer José Cisneros

It’s happened to most of us — you get a bill you can’t pay, and you shove it to the bottom of the mail stack. Then the phone calls start. This is stressful enough when you owe the debt, but imagine getting harassed by debt collectors for a bill that isn’t even yours, or was issued by mistake. This happens every day in San Francisco. Between July 2011 and March 2018, the Consumer Financial Protection Bureau (CFPB) received over 400,000 complaints about debt collection — over 50,000 from California consumers alone.

The federal Fair Debt Collection Practices Act (FDCPA) was enacted in 1977 to eliminate abusive debt collection practices. The Trump Administration’s recent proposal on enforcing this law does not go far enough to protect consumers. Under this proposal, debt collectors have little responsibility for making sure that the debts they are collecting are accurate, and consumers can expect endless phone calls, emails, texts, and even social media messages from debt collectors.

Last month, we submitted a letter, along with City Attorney Dennis Herrera, to the CFPB detailing our concerns with many aspects of this proposal.

But that’s not all we’ve done. Here in San Francisco we’ve been busy making sure our families have the best resources possible when it comes to managing their debts:

1. Offering high quality 1:1 financial coaching to San Francisco families who are facing financial hardship, or planning for the future

We believe every person in San Francisco — regardless of the size of their bank balance — can benefit from time with a well-trained financial coach. We already offer the services at 17 locations across the City. We are now expanding this free, public service to support anyone working, living or receiving services in San Francisco. To learn more or schedule an appointment call 877–256–0073.

With this help, people can get back on their feet financially. Take Jesse for example. Jesse is a local resident and part of a paid job training program offered by the City. Through a partnership with the Treasurer’s Smart Money Coaching program, anyone receiving social services through the City is eligible to meet one-on-one with a high-quality financial coach.

Jesse began meeting with his coach in July 2019. He shared that he had defaulted on his student loans with no plans for how to pay them off. Jesse did not have a bank account at the time and preferred doing business in person and using only cash. Within one month, with the help of his coach, Jesse opened a safe bank account, saved $750, opened a secured credit card, and created a plan to pay off his student loan of $2200 at a fraction of what was owed.

Smart Money Coaches like Andrew help people with their finances and achieve their financial goals

2. Making sure government is a good actor, and not causing harm

Government fines and fees can push people into a financial hole they cannot climb out of. Poor people and people of color are usually hit the hardest. SaverLife — a national nonprofit that helps working families achieve prosperity through savings — found that for low-income families in California “reducing city and state fines and fees” was #2 on a list of 15 issues that would most impact their household financial stability. That puts charges from government above minimum wage, healthcare, and even childcare expenses!

Jessica, a SaverLife member, pledged to save her tax return, and was selected as SaverLife’s Grand Prize Winner. Photo Courtesy of SaverLife

Charging people fines and fees that exceed people’s ability to pay them is a “lose-lose” for people and for government. In 2016, Treasurer Cisneros launched The Financial Justice Project — the nation’s first effort embedded in government to assess and reform fines, fees, and financial penalties that disproportionately impact struggling residents. As Mayor, I am committed to balancing our budget equitably and in ways that are not on the backs of the poor. Together, we’ve made our library fine-free, lifted $32 million in debt from criminal justice fees for 21,000 people, are working to make all phone calls from jail free, and have given low-income people a break on the city’s tow and boot fees.

3. Proving that fair collection can yield more revenue

Nobody likes getting a parking ticket or paying taxes, but we need this revenue to run the City. It’s the Treasurer’s duty to collect all outstanding bills on behalf of our entire City and County. But unlike private debt collectors, we take an empathetic approach whenever possible, work very hard to make sure the debts are valid, and that you have options to pay your debt without ruining your financial health.

Over the past two years, we’ve made major changes to the way we collect debt from San Francisco residents and businesses. The collection of delinquent accounts is now twice as fast (30 days vs. 60+ days). The speed is critical — by communicating with people faster and more clearly about what they owe, they pay faster, and avoid hefty late fees.

We can’t stop all the harm that Washington is causing, but we are proud to be leading the country in these reforms.

Financial Planning Day

Lastly, today is Financial Planning Day in San Francisco. Join us at the San Francisco Main Branch Library at 100 Larkin Street from 9am-3pm to receive free, no strings-attached financial advice from professional financial planners. For more information, visit:

London Breed

Written by

45th Mayor of the City and County of San Francisco

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