HomeMy WebLinkAbout0109.093January 7 ~ 1993
The Honorable City Council
Palo Alto, California
8 t1M'''ry of otili~_~illinq By.to •• Proposal
Members of the council:
7
This report summarizes the policy issues as requested by the r'inance
Committee on November 17, which. were contained in depth in ~.~51C!92
submitted. to council on November 12. 1992 for :r:"eferral to the Finance
Committee~
Blo)[arOllpd
At its November II, 1992 ~eetinq, the Finance Committae recommended an
exeC\l.t.i.ve sWIllIIary be-prepared to sUml'Da~i:ze the pollcy issues identified
by the Committee regardinq the utility Billing System CUBS) proposal 4
The issues identified are:
1} Is the current system meeting the utility customer needs?
2) Will the new system pay for itself in a reasonable period of time?
3) What is the ~ost cost effective way to implement a new system?
Diseus.iolL
1. Is the current system meeting the utility customer needs?
The current UBS is 20 years old and does not ~eet the needs ot the
utility customers in three major ar~as:
a} It is ineffective a.s a resource to provide quality customer
service ~ Due to cDmplex iJesign and hardware and software
limi tat-ions, customer inq .. liries regarding historical use and
conservation data ~r~ often unavailable through the UBS. ~lso,
acknowledgement of utility payuents received is delayed o)"'.e to
three days because of the UBS processing requirements. Thil$
causes customer problems when a Utility customer service
representative cannot confirm a payment, particularly if that
payment w').s late. Many other exa!IJ.ples exist whereby customer
service i~ adversely impacted.
b) Due to aged technology, software programming limitations, and a
lack of access to information on a real-time basis, info~mational
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and analytical requirements cannot be met or are delayed. 'Ih.e.
ability to query or to perform revenue tr.ac:Ung, rate analysis,
COJUlooity forecasting', custOJ:ler .o::redit mandgement, transfcl'1IIer
management, and meter accountability is severely limited. The
inherent complexity requires substantial programmer intervention
on an c~90in9 basis, while a ney UBS would ~power .taf! to obtain
intormation to m.eet customer nee-ds and to provide effect.ive
.anagement information.
c, '{'he system creates ineffiCiency because it is not ir.:tegrated.
Manual intervention is otten necessary to bill certain customer
accounts. Sou:.e customer records are stored on printed cards
'JIakinq retrieval ot s\!ch data time consuming. Th.e demand electric
system is n.ot integrated 'With the main billing system which
createE the potential for human error resulting in not billing
certain accounts.
2. will tbe new system pay for itselL in a reasonable period of time?
The proposed $700,000 UBS, based on a C06t benefits analysis of hard
dollar savings, would pay for itself in approximately two and one
half years after imp~ementation is complete. The UBS Phase I Study
(February 8, 1991) identified approximately $265,000 in estimated
hard dollar savings. Hard. dollar savinqs are based on actual
situations 'Where it is :Delieved an automated Dilling process. wOClld
have aided in collecting revenue or reducinq ~~nditures. Exa~ples
include automating the meter set/exchange process to assure no
accounts will be omitted fr~m billinq, and automating a transformer
replacement program which could reduce custome= outaqes, damage to
other equipment, lost revenue and claims against the City~
3~ What js the most cost effective way to implement a new system?
The most cost effective method is to upgrade the current vas by
adding UNIX open system technology and en-line, real time transaction
processing features which ~ill best meet customer and staff
expectations today and 'Will support the City I s future direction
tomorrow.
Respec~fully submitt~d,
w~ Randolph Baldschun
Assistant Director of utilities
Administrative Services
fJ,~ r~
I>ianah Neff I I
Director, tnformation Resources
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Richarr! L. Young
Director of Utilitie~