“UTILITY BILLING BEST PRACTICES”

The trials and tribulations of dealing with water/sewer customers and

their bills

Florida Government Finance Officers Association (FGFOA)School of Government Finance – November 18-22, 2013

“UTILITY BILLING BEST PRACTICES” Presentation by Ingrid Gaskin-Friar

November 21, 2013 – 10:00 a.m. – 11:40 a.m.

City of Melbourne Website

I Introduction

II Overview – Hierarchy and Responsibilities of Staff

III City Code – Chapter 32

IV Bill Samples and Billing Rates

V Bad Debt

VI Refunds

VII Mandatory Hook-up

VIII Application Process

IX Collections

X Cut-Off Policy

XI Opportunity to Increase Payment

XII Questions and Answers

XIII Appendix Material

IntroductionSection I

LEADERSHIP

A) Wren, J.T. (Ed.). (1995). The Leader’s Companion: Insights on Leadership Through the Ages. New York: Free Press, p.70.

Water: “The wise leader is like water.

Consider Water: Water cleanses and refreshes all creatures without distinction and without judgment; Water freely and fearlessly goes deep beneath the surface of things; Water is fluid and responsive; Water follows the law freely.

Consider the Leader: The Leader works in any setting without complaint, with any person or issue that comes on the floor; the Leader acts so that all will benefit and served well regardless of the rate of pay; the Leader speaks simply and honestly and intervenes in order to shed light and create harmony.

From watching the movements of Water, the Leader has learned that in action, timing is everything. Like Water, the Leader is yielding. Because the Leader does not push, the group does not resent or resist.”

The City of Melbourne bills approximately 58,000 utility customers monthly.

Staff address 8,000 to 10,000 calls monthly.

The City utilizes Tyler, MUNIS CIS-software for its utility billing.

Water and Sewer rates increased by an average of 7% in this fiscal year, in accordance with a five-year rate plan approved by Melbourne City Council in May 2012.

The water and sewer system budget is proposed to increase by $1,897,846 from this past year.

Total water sales: $24,000,000 Sewer charges: $18,000,000

Note: The City of West Melbourne utilizes the City’s bulk water sales at the inside City rate. The City of West Melbourne utilizes 9% of the City of Melbourne’s water sales.

B)

Overview – Hierarchy & Responsibilities Of Staff

Section II

Financial Services

Director of Finance

Customer Service

Manager

Financial Systems Administrator

Utility Billing Special

Chief Accounts Clerks(3)

Sr. Accounts Clerks(5)

Accounts Clerks(5)

Accounts Clerks– Part Time (2) –

AARP

SwitchboardOperator

STAFFING RESPONSIBILITIES RELATING TO CUSTOMER SERVICE CALLS:

Four (4) Accounts Clerks provide cashiering function in conjunction with Customer Service at the front office.

Chief Accounts Clerks and Senior Accounts Clerks assist with Customer Telephone calls in conjunction with other daily assignments.

Utility Billing Specialist addresses customer complaints transferred from staff, prior to forwarding to the Customer Service Manager.

Financial Systems Administrator is responsible for all technological improvements/upgrades and month end closing.

Customer Service Manager addresses customer complaints that are forwarded from the Utility Billing Specialist, Director of Finance, and City Manager/Council.

Finance Director assumes the customer complaint, if the customer refuses to speak with the Customer Service Manager.

City Manager delegates customer complaints to Director of Finance and/or Customer Service Manager for resolution.

99 % OF CUSTOMER ISSUES ARE ADDRESSED AT THE STAFFING LEVEL

City Code – Chapter 32Section III

City of Melbourne Utility Billing

City Code

City Manager: (Reference City Code Sections below)

MELBOURNE CITY CODE Sec. 32-11

Administrative Adjustments to Utility Bills

MELBOURNE CITY CODE Sec. 32-79

Authorized to provide adjustments to Water Bills

MELBOURNE CITY CODE Sec. 32-308

Sewer Service Rate

Bill Samples and Billing RatesSection IV

* Water and Sewer Security Deposits vary by size of meter or number of units for multi-family establishments and by city

** Commercial customers -2 ½ times the average monthly bill at same location

METER SIZE WATER COST SEWER COST

¾” $43.00 $77.00

1” $107.50 $192.50

1 ½” $215.00 $385.00

2” $344.00 $616.00

3” $791.00 $1,416.80

4” $1,075.00 $1,925.00

6” $2,150.00 $3,850.00

8” or larger To be negotiated

Residential Customers’ Water and Sewer Security Deposit¾ inch meter - $120.00

A customer may tap a fire hydrant for construction use only with permission from the City and after placing a meter deposit and payment

for the water used based on volume registered by the meter.

METER SIZE DEPOSIT AMOUNT

¾ inch $150.00

1 inch $300.00

2 inch $1,000.00

Deposit is refunded when the meter is returned.

City Code Sec. 32-78Construction Meter Water Sales:

1. View a Typical Bill Charges:WaterSewer

GarbageRecyclingYard Trash

2. Advisory Notes on back of utility bill: City of Melbourne water, sewer, garbage, recycling and yard trash, reclaim

water City of Melbourne water, Brevard County sewer, garbage, recycling, yard

trash, and utility tax City of Melbourne water, City of Cocoa Beach sewer City of Melbourne water, City of Palm Bay sewer (Lakes of Melbourne) City of Melbourne water, City of West Melbourne sewer*

Late Fee, Shut Off Fee, Lien Fee are also included on the bill Bills include a Shut Off date where applicable

*The City of West Melbourne utilizes the City of Melbourne’s bulk water sales at the inside City of Melbourne rate.

TWO TYPES OF BILLING

Billing Functions are outsourced with AXIS

Bill due date: 25th day of the cycle

Late Fee Applied: 26th day of the cycle

ACH Bills with bank draw: 25th day of the cycle

Final Bills: Security deposit credit refunded

Regular paperbills via

U.S. MailE-Bills

Each week of month is a regular billing period for 12,000 to 16,000 Bill Accounts. Approximately 700 – 800 accounts are finaled monthly.

AMOUNT RATE CALC. TOTAL

Water Base Charge (inside) $7.58

Water Consumption 8,000 Gallons $4.66 +37.28 $ 44.86

Sewer Base Charge (inside) $11.21

Sewer Consumption 8,000 Gallons $6.49 $51.92 $63.13

Utility Tax (none)

Garbage * $6.50

Recycling/Yard Trash * $4.07

Sanitation Service Charge ** $.27

Shut Off ChargeLate Fee 1.5% Minimum

$30.00$5.00

SAMPLE RESIDENTIAL ACCOUNT COMPUTATION

* Waste Management Contract ** Funds utilized to manage Recycling Division

*Waste Management Contract ** Funds utilized to manage Recycling Division

Shut Off Charge $30.00 Late Fee 1.5% , Minimum $5.00

AMOUNT RATE CALC. TOTAL

Water Base Charge (inside) 14 ERCs $7.58 $106.12

Water Consumption 112,000 Gallons $4.66 +521.92 $628.04

Sewer Base Charge (inside) 14 ERCs $11.21 $156.94

Sewer Consumption 112,000 Gallons $6.49 $726.88 $883.82

Utility Tax None

Garbage * 89 units $6.50 $578.50

Recycling/Yard Trash * 89 units $4.07 $362.23

Sanitation Service Charge ** 89 units $.27 $24.03

Shut off Charge***

Late Fee 1.5% Min. $5.00

Total Bill $2,476.62

*** Call Commercial Customers or use Door Knocker

SAMPLE COMMERCIAL ACCOUNT COMPUTATION

The City of Melbourne

City of Melbourne Beach

City of Indialantic

City of Indian Harbour Beach

City of Satellite Beach

Town of Palm Shores

The City of Melbourne provides billing services for the following cities at “outside” City rates for city water and Brevard County sewer charges:

The City of Melbourne provides billing services for Utility Taxes - charges each City a billing service fee:

The City of Melbourne

Indian Harbour Beach

6% Tax

Indialantic10% Tax

Melbourne Beach

9.5% Tax

Melbourne Village6% Tax

Palm Shores10% Tax

West Melbourne

8% Tax

Notably absent: City of Melbourne customers have no Utility Tax

The City of Melbourne bills sanitation services for the following companies under contract:

Waste Management

(Back door, curbside, multi-family)for garbage, recycling and

yard trash

Waste Pro

(Back door, curbside, multi-family)for garbage, recycling and

yard trash

Customer Contacts:

Letter

Telephone

Outside Drop Box

Lobby Drop Box

Email

Fax

Customer Walk Ins

Bad DebtSection V

A) Write off/bad debt 1) 3 years history of write offs 2) write off as a percentage of water sales

WATER SALES

2011 • $26,291,280

2012 • $27,694,566

2013 • $27,579,821

011

2011 • $207,959.11

2012 • $228,473.46

2013 • $128,143.18

BAD DEBT

PERCENTAGE OF BAD DEBT TO WATER SALES

2011 • 008% less than 1%

2012 • .008% less than 1%

2013 • .005% less than 1%

B) SEWER CHARGES

2011 • $17,536,902

2012 • $17,928,518

2013 • $18,220,110

2011 • $309,767

2012 • $315,000

2013 • $267,000

2011 • $8,803

2012 • $8,600

2013 • $8,991

RECONNECTION CHARGE $30.00SHUT OFF FOR NON PAYMENT

3% UTILITY TAX BILLING FEE

2011 • $21,119

2012 • $28,000

2013 • $20,062

2011 • $165,295

2012 • $170,000

2013 • $164,319

SERVICE FEEBROKEN METER OR CURBSTOP

SERVICEINITIATION FEE

2011 • $300,453

2012 • $306,000

2013 • $285,119

2011 • $13,274

2012 • $12,600

2013 • $14,787

WASTE MANGEMENTBILLING FEE

$.79 PER BILL

WASTE PROBILLING FEE

$.79 PER BILL

BILLING FEES

2011 • $2,812

2012 • $3,000

2013 • $2,925

2011 • $7,660

2012 • $7,700

2013 • $7,710

MELBOURNE VILLAGE3% UTILITY TAX REVENUE

PALM BAY (SEWER)$1.59 PER BILL

BILLING FEES

2011 • $382,256

2012 • $384,500

2013 • $366,819

2011 • $12,885

2012 • $12,650

2013 • $13,401

BREVARD COUNTY (SEWER)$1.59 PER BILL

COCOA BEACH (SEWER)$3.00 PER BILL

2011 • $167,519

2012 • $175,000

2013 • $177,689

2011 • $526,433

2012 • $550,000

2013 • $509,505

RECLAIMED WATERSALES

LATE FEES 1.5%$5.00 MINIMUM

2011 • $27,700

2012 • $35,000

2013 • $21,973

RECORDING FEESAdministrative Fee $25.00Recording Fee $25.00

RefundsSection VI

A) History of water and sewer adjustments

B) Approval process

C) Melbourne City Code Sec. 32.308(d) LEAK ADJUSTMENTS:

Pool Fill Pool Refill Slab Leaks Special City Manager Request

SEWER CREDITS WILL NOT BE GRANTED FOR: Broken or leaky water lines where the water enters

the sanitary sewer system (leaky toilets or inside faucets)

Water used for irrigation Negligent use of water Undetermined use of water

YEARNUMBER OF ACCOUNTS

GALLONSIN THOUSANDTHS

DOLLARAMOUNT

2011 436 15,036.1 $91,953.47

2012 466 22,031.5 $140,102.79

2013 424 26,571.8 $113,108.70

SEWER ADJUSTMENTS

WATER ADJUSTMENTS

YEARNUMBER OF ACCOUNTS

GALLONSIN THOUSANDTHS

DOLLARAMOUNT

2011 130 12,243.5 $52,183.58

2012 117 13,338.4 $57,376.08

2013 101 11,178.2 $49,869.64

Mandatory Hook-upSection VII

WATER AND SEWER IMPACT FEES

WATER AND SEPTIC SYSTEM

WATER ONLY

ANNEXATION – BILL GARBAGE ONLY (TEMPORARY)

MAY BILL BASED ON A FIVE-YEAR LINE EXTENSION PAYMENT PLAN – INTEREST INCLUDED

Application ProcessSection VIII

A) Refundable Security Deposit – Residential ¾” MeterB) $43.00 Water and $77.00 SewerC) Non-refundable Initiation FeeD) Rental LeaseE) Picture Identification – Driver’s License/PassportF) Ownership Documentation or HUD StatementG) Annual Water and Sewer RatesH) ERC Where ApplicableI) ERC Computation for Multi-family & Commercial Accounts

Exemption from Security Deposit: Twelve Consecutive Months of Good Pay History at a Prior Address

Note: May Relinquish Capacity in Writing or After 12 Months, Pay Impact Fees or Pay Water and Sewer Base Charges

CollectionsSection IX

BANKRUPTCY

A) Bankruptcy Court Documentation – Bankruptcy Date

B) Compute Bankruptcy Amount – Amount Written Off

C) New Account Established – Post Bankruptcy Date

D) Type of Bankruptcy – Chapter 7, Chapter 11, etc.

E) Receivership – Receiver Pays Utility Bills(legal document) Required to Change Name

LIENS AND COLLECTION AGENCIES

A) $100.00 Minimum Balance to Place a Lien

B) Lien on Owner Account

C) Probate Documentation/New Owner to Establish Service

LIENS FILED LIENS RELEASED

LIENS

Following Lien Schedule for Liens and Lien Releases

2008 – 2011 Liens Gradually Increased

YearNo. ofLiens

Revenue

2011 237 $68,661.80

2012 455 $149,482.55

2013 303 $91,479.97

YearNo. ofLiens

Revenue

2011 215 $57,871.09

2012 333 $97,981.32

2013 403 $137,667.36

Cut-off PolicySection X

Automatic Meter Reader (AMR) Meter

ADE Meter with AMR Data Profile Capability:

Hourly Water Consumption Program – Graph

Downloaded and Formatted into Word Format

Manual Meters are Converted to AMRs

Remote Meter

Commercial/Multi-Family Units

5 Days Before – Notice Posted on Premise at Individual Units

Certified Letter Sent to Owner - $250 Connection Fee

BILLING ERRORS

A) Billing Adjustments for Incorrect ReadsB) Utilize the High and Low ReportC) Estimated Bills – Flooding, etc.D) Utilize Skipped Bill Report

THEFT OF WATER

A) Fraudulent LeaseB) Squatters – ResidenceC) Former Owners Renting Their Foreclosed PropertyD) Account in a Different Customer’s Name – to Avoid

Existing BalanceE) Accounts Left in Owner’s Name

COORDINATION WITH CHARITIES

A) VouchersB) Shut Off for Delinquent BillsC) Utility Bill Balance – No Security Deposit

CUT OFF POLICIES AND PROCEDURES

A) Threshold Balance–Equal to or Greater than $75B) Monday, Tuesday, Wednesday, ThursdayC) Melbourne, Beaches, Eau Gallie (Schedule)D) Shut Off Date is Noted on BillE) Shut Off a Week After date Stated on Bill;

i.e., Shut Off Date 9/16/13; Shut Off 9/23/13

Approximately 900 Accounts Shut Off Monthly

PROCESS

Check Special Condition Notes

Date Generated

Work Orders

EFT

Text

Account Inquiry

900 Metered Accounts Shut Off per Month

MAY JUNE JULY AUG SEPTC1 611-650 35 53 50 49 31C1 110-119 44 42 45 44 37C1 120-124 24 22 38 28 26C1 205-221 39 43 55 53 45

C2 655-745 65 34 59C2 127-139 40 68 26C2 140-150 58 75 34C2 222-250 43 79 47

C3 817-870 34 37 43 57 44C3 151-155 21 23 32 40 26C3 156-162 70 54 30 81 62C3 254-337 52 68 28 58 74

C4 912-957 14 28 27 37 20C4 170-181 72 85 83 85 62C4 182-191 37 28 40 43 27C4 341-411 14 10 16 24 15

# OF ACCTS ON SONP LIST

MAY JUNE JULY AUG SEPTC1 611-650 $75.00 $75.00 $75.00 $75.00 $100.00C1 110-119 $75.00 $75.00 $75.00 $75.00 $75.00C1 120-124 $75.00 $75.00 $75.00 $75.00 $75.00C1 205-221 $75.00 $75.00 $85.00 $75.00 $75.00

C2 655-745 $75.00 $115.00 $75.00C2 127-139 $75.00 $75.00 $115.00C2 140-150 $75.00 $75.00 $115.00C2 222-250 $75.00 $75.00 $85.00

C3 817-870 $75.00 $75.00 $75.00 $75.00 $75.00C3 151-155 $75.00 $75.00 $75.00 $75.00 $75.00C3 156-162 $75.00 $75.00 $100.00 $75.00 $75.00C3 254-337 $75.00 $75.00 $125.00 $115.00 $75.00

C4 912-957 $75.00 $75.00 $75.00 $75.00 $75.00C4 170-181 $75.00 $75.00 $75.00 $75.00 $75.00C4 182-191 $75.00 $75.00 $75.00 $75.00 $75.00C4 341-411 $75.00 $75.00 $75.00 $75.00 $75.00

MINIMUM $$$ ON SONP LIST

Opportunity To Increase PaymentSection XI

OPPORTUNITY TO INCREASE EASE OF PAYMENT BY: Drop Box Outside City Hall Drop Box in the Lobby of City Hall ACH – Checking, Savings (Requires ACH Form) Online Payment Access - Website

PAYMENT VIA PAYMENT PROCESSOR: Visa Mastercard Discover American Express

($2.50 FEE FOR INCREMENTS OF $100.00)

PAYMENT VIA E-CHECK: Checking Account Savings Account

($2.70 FEE FOR E-CHECK)

Questions & AnswersSection XII

Appendix MaterialSection XIII

Ingrid Gaskin-FriarCity of Melbourne Customer Service Manager

321-608-7160 igaskin@melbourneflorida.org

Ms. Ingrid Gaskin-Friar joined the City of Melbourne in 1989. Ms. Gaskin-Friar has been the City of Melbourne Customer Service Manager for the past15 years, where she manages Utility Billing and Collections and the Revenue Division, supported by a staff of 21 employees.

Prior to serving as the City’s Customer Service Manager, Ingrid worked as the City of Melbourne Grants Administrator for 9 years, where she prepared grant applications and managed thousands of dollars in grant projects. Ingrid worked as a Tax Auditor with the State of Florida Department of Revenue in 1988, after holding several positions as staff accountant in the private sector and banking institutions.

Ingrid received a MBA in 1993 from Florida Institute of Technology, Melbourne, FL and a BS in Public Accounting from Fordham University, Bronx, NY.

Ingrid served as President of the Space Coast FGFOA Chapter from 2011-2013, is a 2013 Chairperson on Treasury/Debt Section Subcommittee of FGFOA School of Government Finance, and since 2005 has served as Treasurer of the Laurelwood Home Owners’ Association.