utility information pipeline

2017 Utility Fee Survey Results – Part I

For the past few months, I’ve been conducting the 2017 Utility Fee Survey. This is an update to the original Utility Fee Survey in 2012 and the 2015 Utility Fee Survey. The survey was designed to research what fees utilities charge, how much they charge for each fee, and to see what changes have taken place in the last two years.

The Utility Fee Survey has become a biennial survey, alternating years with the Utility Staffing Survey.

As was the case in each of the previous surveys, the results include too much information for a single issue. If you’re interested, here are the results from the 2012 and 2015 Utility Fee Surveys:

 

2012 Utility Fee Survey Results – Part I

2012 Utility Fee Survey Results – Part II

2012 Utility Fee Survey Results – Part III

 

2015 Utility Fee Survey Results – Part I

2015 Utility Fee Survey Results – Part II

2015 Utility Fee Survey Results – Part III

 

This is the first of three consecutive Utility Information Pipelines publishing the results of the 2017 Utility Fee Survey.

Demographics of survey respondents

118 utilities (an 11.3% increase from 2015), representing 19 states, ranging in size from 88 to 75,000 active accounts participated in the survey. Click on the links below to see charts of the various demographic data:

Number of responses by state

Size of utilities responding

Size of utilities under 20,000 accounts responding

Types of utilities responding

Services provided by responding utilities

Positions of individuals completing survey

Tap fees and impact fees

The survey started with water and sewer tap and impact fees. There are some key distinctions to bear in mind when comparing tap and impact fees.

Tap fees should recover the cost of making the actual water or sewer tap. This includes direct costs such as labor, materials and vehicle use as well as any indirect costs associated with completing the tap. Tap fees are classified as operating revenues.

Impact fees, sometimes called availability fees or system development charges, are designed to cover the incremental capital cost of adding an additional user to the water or sewer system. Impact fees are classified as non-operating revenues.

For utilities charging an impact fee based on number of bedrooms, monthly or daily usage, or square footage, I assumed three bedrooms or 3,000 gallons per month or 1700 square feet.

Residential water tap fees charged by utilities responding to the survey range from $50.00 to $10,925.00 as shown below (clicking on the any of the graphics will open a larger image in a new window):

Two other utilities charge based on the time and materials cost incurred for a residential water tap – one at actual cost and one at cost plus ten percent.

Utilities responding to the survey charge residential sewer tap fees ranging from $50.00 to $15,000.00 as depicted by this graph:

One additional utility charges the actual time and materials cost incurred plus ten percent for a residential sewer tap.

Residential water impact fees charged by utilities responding to the survey range from $200.00 to $3,900.00 as shown in this graph:

Two additional utilities charge water impact fees that vary based on construction.

Utilities responding to the survey charge residential sewer impact fees ranging from $200.00 to $5,100.00 as shown here:

Three additional utilities charge sewer impact fees that vary based on construction.

Upcoming issues

Part II – August 1, 2017

The next issue will deal with delinquent account fees and policies, including late fees, cut-off fees and after hours reconnect fees.

Part III – August 15, 2015

The final survey results issue showcases any remaining fees, including application, returned check, meter reread, meter tampering and convenience fees.

A special offer

I’m offering a special offer to the first five Utility Information Pipeline readers who respond. If you are one of the first five to respond, I will conduct a personalized fee consultation for one-third off the regular price. That’s $1,000 rather than the usual $1,500 price for this service!

I will review your utility’s current fee schedule and conduct an in-depth phone assessment to learn more about your fees. You will receive a presentation quality document illustrating how your fees compare with other utilities. Also included will be my recommendations for revising any existing fees and suggestions of new fees you should consider charging.

If you are interested in this special offer, please contact me by calling 919-232-2320 or e-mailing me at gsanders@logicssolutions.com. Remember, the special discount offer is only available to the first five people who respond!

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© 2017 Gary Sanders

5 easy ways to get more bank draft customers

Recently, during a sales presentation, I came to the bank draft tab in Logics’ Utility Management application. I asked, as I always do, if they accepted bank drafts. The City Administrator spoke up and said he wished 99% of their customers were bank draft customers. When I asked why not 100%, he replied “There’s always that one percent that won’t do it, no matter how much sense it makes.”

After everyone stopped laughing, one of the office staff asked if I had any ideas how to increase bank draft participation. Interestingly enough, I had just finished the first draft of an ebook entitled 5 Surefire Ways to Save Time Processing Payments. The first of the five ways is bank drafts and the chapter goes on to list five ways to promote bank drafts.

Here they are…

1. Waive the first late fee in exchange for signing up for bank drafts

Whenever a customer calls to complain about being charged a late fee, offer to waive the penalty if they sign up for bank drafts. Once they are a bank draft account, they will never be late again!

2. Offer incentives to sign up

I know of utilities that offer a one-time $5.00 credit for signing up for bank drafts. Others give a $1.00 per month credit for the first year the customer is drafted.

3. Ask every new customer if they want to pay by bank draft

Have you applied for a life insurance policy recently? Insurers practically make issuing the policy contingent upon the insured agreeing to pay by direct debit. Why not deal with new customers applying for service the same way? There’s an age-old adage in sales, “assume the close”, and the same technique can work for signing new applicants up for bank drafts. Why not hand them a bank draft form along with the application to sign?

4. Include a signup form on your website

Ideally, your customers should be able to complete an online form with the bank draft information. But, if not, at least post a downloadable sign-up form on your website so your customers can complete and return it to your office.

5. Promote bank drafts on your utility bill

Does your utility bill have a section for comments you can enter each billing? Why not use this to publicize bank drafts along with whatever other announcements you have that month? If you print full-page bills, you can also include a bank draft sign-up form as an insert with the utility bill.

How do you promote bank drafts?

What does your utility do to promote bank drafts? Do you have a unique or innovative way of encouraging your customers to sign up for bank drafts? Please leave a comment at the bottom of this post for other readers to see.

2017 Utility Fee Survey results

The next Utility Information Pipeline, to be published on July 18, will include the first set of results for the 2017 Utility Fee Survey. The survey technically closed at the end of the day, June 30, but I haven’t started recapping the results yet.

If you haven’t participated and would still like to, you may click here to complete the survey. It should take less than five minutes to complete.

Trying to streamline payment processing?

If you’re looking to reduce the amount of time it takes to process payments, or streamline any other part of your operation, please give me a call at 919-232-2320, or email me at gsanders@logicssolutions.com for more information about how a business review could help you review your entire office operation.

 

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© 2017 Gary Sanders

How to update your Google Maps listing

Before we get to the topic of this post, the last Utility Information Pipeline included a poll asking how you handle temporarily inactive accounts. Here is a recap of the responses to the poll (clicking on the chart will open a larger graphic in a new window):

I was pleasantly surprised to see that a majority of the poll responses do charge temporarily inactive accounts, whether it’s continuing to bill them or by assessing a fee.

Google Maps error

I was involved in a sales presentation last week and had an interesting experience when I clicked on the Mapping link within Logics’ Utility Management software. I always set the service address of my demo account to the prospect’s office address so they recognize the map.

The pushpin for the address appeared in the correct place, but the Google Business icon for the utility office was on the house next door! I commented on this and the utility staff laughed and said, yes, customers often drive past their office and have to turn around next door.

I said “Let’s fix that.” and clicked on the “Report a map error” link in the lower right corner of the inset map (this link is called “Send feedback” if you are in native Google Maps). I was able to drag the icon to the correct building on the map and, within minutes, received an email from Google confirming my correction had been made.

Step-by-step instructions to correct a map error

Back in 2012, I wrote about updating your listing in Google Places (now called Google Business). In case your Google Map listing is misplaced, as was the case with Auburn Water System, here are the steps to correct it.

As you can see from the screen shot below, the pushpin was between two buildings rather than directly on the Auburn Water System office:

  1. Click the “Send feedback” link in the lower right corner.
  1. Select “Edit the map” from the Send feedback menu.

  1. Click on the icon for the business you want to correct, in this case Auburn Water System.
  1. Check “Marker is placed incorrectly on the map” beside Location on the Suggest an edit menu.

  1. Drag the marker to the proper place on the map.
  1. Click submit.
  1. A message will pop up thanking you for improving Google Maps.

  1. Once your edit has been approved, you will receive an email from Google Maps letting you know it was a success!

The end result is the pushpin is now directly on the Auburn Water System office building! I guess now I should do the same thing for Choctawhatchee Electric Cooperative, who share the same building with Auburn Water System. (I’m unsure why they didn’t show on the “before” map…)

Last chance for the 2017 Utility Fee Survey

This is your last chance to participate in the 2017 Utility Fee Survey. The survey will be closing at the end of the day, June 30, so if you haven’t already done so, please click here to complete the survey. It should take less than five minutes to complete. For an idea of what to expect from the survey, here are the results of the 2015 Utility Fee Survey:

If you have any questions, please feel free to e-mail me at gsanders@logicssolutions.com or call me at 919-232-2320.

Thank you in advance for your participation in the 2017 Utility Fee Survey.

Reviewing your policies?

If you’re in the process of reviewing or updating your policies, please give me a call at 919-232-2320, or email me at gsanders@logicssolutions.com for more information about how a business review could help you review your entire office operation.

Click here to subscribe to my free, bi-weekly email newsletter...

© 2017 Gary Sanders

How do you handle temporarily inactive accounts?

I had a Town Manager who attended my recent presentation at the North Carolina Rural Water Association Annual Conference contact me with a question. He wanted to know what I recommended regarding billing for temporarily inactive accounts.

Snowbirds

If you have seasonal customers, you know the issue he was inquiring about – snowbirds from colder climates who go south for the winter (or, conversely, winter homes in warmer climates) or summer homes where your customer only wants the utilities on for the summer months.

The dilemma facing your utility is should you continue to bill the base charge each month, even if the customer has no usage?

Recovery of infrastructure costs

One clue as to how to handle this is understanding the rationale behind your base charge.

For many utilities, the base charge is designed to recover the investment you have in providing service to the property, regardless if there is usage. You must maintain the infrastructure and service lines year-round and you have an investment in a meter at the premises, even if no one is living there.

If this is the case for your utility’s base charge, you have every reason to continue to charge the base charge, even if the account is temporarily inactive.

Fees in lieu of monthly billing

An alternative to billing the customer each month is to charge a fee to turn the service off and another fee to turn it back on (based on the user fee concept that you are performing a service for this customer that wouldn’t otherwise be required).

The idea here is the two fees combined should cover your staff’s time and effort to disconnect and reconnect the service as well as recoup what your customer would have paid if they left the service on with no usage and paid the base charge only.

How does your utility handle this?

How does your utility handle temporarily inactive accounts? Please take this quick poll.


 
Once you’ve taken the poll, you will be able to see the results to see how other utilities responded. I’ll publish the final results in the next issue.

2017 Utility Fee Survey

The 2017 Utility Fee Survey is ongoing. If you haven’t already completed it, please click here to complete the survey. It should take less than five minutes to complete. For an idea of what to expect from the survey, here are the results of the 2015 Utility Fee Survey:

If you have any questions, please feel free to e-mail me at gsanders@logicssolutions.com or call me at 919-232-2320.

I’m hoping for as much participation as possible in the survey, so please feel free to pass this on to your colleagues at other utilities.

Thank you in advance for your participation in the 2017 Utility Fee Survey.

Reviewing your policies?

If you’re in the process of reviewing or updating your policies, please give me a call at 919-232-2320, or email me at gsanders@logicssolutions.com for more information about how a business review could help you review your entire office operation.

Click here to subscribe to my free, bi-weekly email newsletter...

© 2017 Gary Sanders

What are your repayment plan policies?

Once again, one of the listservs I subscribe to provided the subject matter for a newsletter. This time it was a town manager asking about policies allowing repayment plans.

Due Date

A previous Utility Information Pipeline described the distinctions between extensions, installment services, and payment arrangements. This issue will examine some of the requirements many utilities impose on customers requesting a repayment plan.

Limited number of repayment plans

Most utilities impose a limit on the number of repayment plans a customer may have within a given timeframe. For example, only allowing two extensions per calendar year or twelve month period.

The rationale for this is, under normal circumstances, your customers should be able to pay their bill by your established due date. Customers who habitually request additional time to pay are abusing the system.

No history of dishonored payment plans

For most utilities that offer repayment plans, failing to honor a previous payment plan automatically makes a customer ineligible for future payment plans. If your customer failed to live up to their agreement, why allow them to take advantage of you again?

Signed agreement

Perhaps the most important part is to require a signed agreement stating the repayment terms and consequences of failing to honor the agreement.

This signed agreement should include promised payment dates and amounts, along with any interest or finance charge to be assessed. As with any legal document, it’s always wise to consult with your attorney when drafting the document.

2017 Utility Fee Survey

The 2017 Utility Fee Survey is still open. If you haven’t already completed it, and would like to participate, please click here to complete the survey. It should take less than five minutes to complete. For an idea of what to expect from the survey, here are the results of the 2015 Utility Fee Survey:

If you have any questions, please feel free to e-mail me at gsanders@logicssolutions.com or call me at 919-232-2320.

I’m hoping for as much participation as possible in the survey, so please feel free to pass this on to your colleagues at other utilities.

Thank you in advance for your participation in the 2017 Utility Fee Survey.

North Carolina Rural Water Association presentation

If you or any of your co-workers or board members will be attending the North Carolina Rural Water Association Annual Conference, please be sure to attend my presentation on Improving Revenue Collections for Utilities this Thursday, May 18 at 8:30am.

If you or someone from your utility does attend, please be sure to introduce yourselves!

Need assistance?

If you’re considering offering payment plans or are unsure if your delinquent account policies are adequate, please give me a call at 919-232-2320, or email me at gsanders@logicssolutions.com for more information about how a business review could help you review your entire office operation.

Click here to subscribe to my free, bi-weekly email newsletter...

© 2017 Gary Sanders

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Gary Sanders

I am the Senior Consultant with Logics, LLC in Raleigh, North Carolina. I have over 35 years experience developing and implementing utility billing and financial software and consulting with utilities and municipalities. My bi-weekly email newsletter draws from my experience in working with over 200 utilities and local governments to offer insight into how utilities can improve operations and better serve their customers. If you have a comment or a suggestion for a future email, please contact me by calling 919-232-2320 or sending an email to gsanders@logicssolutions.com