Even the folks at industry blog insideARM.com seemed almost appalled by the proposal. ARM, by the way, stands for accounts receivable management--a polite term for "we're coming after your money, whether we can prove you owe it or not." The lunch-money proposal in Pennsylvania called for an "introspective moment," says insideARM. Gee, even these clod heads can see a public-relations train wreck in the making:
The Hazelton, Pa.-area school district currently has about $3,000 in unpaid lunch fees. To recoup this money, the Hazelton school board is testing the waters with several collection agencies.
This is one of those situations where reality -- there are few school districts that can afford not to pursue three grand -- brushes up uncomfortably against perceived reality: collection agencies are going after kids for their lunch money. Regardless of how much we may want to shift the conversation, this one is ripe for shifting back by those who only have negative things to say about the accounts receivable management industry.
What does it take to turn the debt-collection industry's stomach? A plan to go after kids' lunch money apparently will do it. Writes insideARM:
Most of the agencies chomping at the bit for this account are suggesting a 70/30 profit split, with the school district taking the bulk of the collected monies home. The current debt of $3,000 seems like a small amount -- and any agency's cut will only run somewhere in the $900 range. However, it's likely that this is a slow-and-steady sort of arrangement, where a firm that successfully wins this collections bid would have a guaranteed account.
Adding a different spin to this program is what amounts to a bit of case management required by any collection agency selected for this proposal. Hazelton's school board is hoping that the collection agency will be able to identify those families who should be receiving free or reduced-price lunches, and funneling those accounts to the appropriate authority.
It's a tightrope walk, though; collection agencies and kids can be a PR nightmare if things aren't handled entirely appropriately. However this could also be another example of the ARM industry working with communities to strengthen them.
In fact, it appears at least one agency has developed a conscience in all of this. Reports the Hazelton newspaper:
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