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Item 1.
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| City Council Work Session | |
| Date: | 02/03/2025 |
| Title: | Utility Billing Conversion Audit |
| Presented by: | Chris Kukulski, City Administrator |
| Department: | Finance |
| Presentation: | Yes |
| Legal Review: | No |
| Project Number: | N/A |
RECOMMENDATION
No action is requested. Dave Allen from SLserco will present their findings and answer questions.
BACKGROUND (Consistency with Adopted Plans and Policies, if applicable)
In October 2024, the City of Billings solicited the services of a firm to undergo a review of our entire utility billing system and processes. A group of City staff and two council members developed a scope for the system audit. After interviewing multiple firms, the City entered into a contract with SL Serco to provide the identified services.
The areas to be reviewed include the following areas:
SL Serco has completed their audit of the system and will be onsite to provide their findings. (see attached audit report and power point presentation)
Based on these findings and our conversations throughout the process, we have learned alot. The following are five areas we would do differently if we started this project tomorrow.
1) A full-time IT expert would be imbedded in the PW department. This is needed going forward and will be requested in the 2026 budget.
2) The city needs to hire a 3rd party software conversion expert who represents the city throughout the project for software conversions of this size, complexity and impact.
3) Increased and improved communication with our customers, council and staff.
4) Once it was determined that the conversion was not going to be completed by May 1, we would delay implementation until October to avoid the summer irrigation season.
5) Once the system conversion failed by producing thousands of "exceptions", we should have requested a delay in implementing rate adjustments to better triage the situation.
There are also series of action-steps being taken:
1) IT and Administration are updating our IT policy (administrative order) to reflect what we have learned.
2) A temporary call center is being set up with temp staff to respond to audit-related calls.
3) We are improving the information on our utility bills, so customers can verify that charges are correct.
4) We need Council to determine when late fees and shut-offs will be reinstated. Staff believe this should be no sooner than three or later than six months.
5) As stated above, our proposed 2026 budget will include an additional IT staff person embedded in PW.
The areas to be reviewed include the following areas:
- Communicate the impact of client requests for adjustments to service
- Perform project status and compliance reporting monthly.
- Determine if the measurement of water consumption was converted appropriately and billed accurately in accordance with data stored in Neptune 360.
- Determine if the last meter reading in the legacy system was imported correctly into VertexOne.
- Determine if customers were billed according to approved rate schedules.
- Determine if prorations between fiscal years and tiers was calculated accurately.
- Determine if the billing data from VertexOne was correctly reflected on the bill image.
- Determine if wastewater charges were calculated correctly.
- Determine if storm and garbage fees were billed correctly based on the abnormal billing periods. Verify proration if applicable.
- Verify that billing cycles and periods were maintained correctly (i.e., no double billing for same or overlapping periods).
- Verify that automatic payments for customers on autopay match what was billed (i.e., no extra debits have been taken).
- Review the CITY’S decision-making process and public communication related to the bills in question. Document where CONSULTANT observes opportunities for process and communication improvements.
- Review summary bill process and multi-account holders online access compared to the industry best practice.
- Report findings to staff and council including a description of the processes used throughout the review and a presentation at a public council meeting.
SL Serco has completed their audit of the system and will be onsite to provide their findings. (see attached audit report and power point presentation)
Based on these findings and our conversations throughout the process, we have learned alot. The following are five areas we would do differently if we started this project tomorrow.
1) A full-time IT expert would be imbedded in the PW department. This is needed going forward and will be requested in the 2026 budget.
2) The city needs to hire a 3rd party software conversion expert who represents the city throughout the project for software conversions of this size, complexity and impact.
3) Increased and improved communication with our customers, council and staff.
4) Once it was determined that the conversion was not going to be completed by May 1, we would delay implementation until October to avoid the summer irrigation season.
5) Once the system conversion failed by producing thousands of "exceptions", we should have requested a delay in implementing rate adjustments to better triage the situation.
There are also series of action-steps being taken:
1) IT and Administration are updating our IT policy (administrative order) to reflect what we have learned.
2) A temporary call center is being set up with temp staff to respond to audit-related calls.
3) We are improving the information on our utility bills, so customers can verify that charges are correct.
4) We need Council to determine when late fees and shut-offs will be reinstated. Staff believe this should be no sooner than three or later than six months.
5) As stated above, our proposed 2026 budget will include an additional IT staff person embedded in PW.
ALTERNATIVES
City Council may:
- Approve; or,
- Not Approve
FISCAL EFFECTS
There are no direct fiscal effects from the Audit. The SLserco contract costs $33,000 plus meter testing estimated at $18,000.