utility information pipeline

GDPR – what is it and do we need to be concerned about it?

If you’re anything like me, you’ve been inundated with emails over the last few weeks with privacy policy updates from what seems like every site you’ve ever visited. Of course, this isn’t a random occurrence – it is related to the GDPR becoming effective last week.

I recently received an email from a newsletter subscriber asking if I had any information about the GDPR and compliance by local governments. This newsletter is a more in-depth response to what I replied to her.

DISCLAIMER: I am not an attorney and the information here is not intended to serve as legal advice. If you have legal questions concerning compliance with the GDPR, please consult with your attorney. This also is targeted at utilities outside the European Union, specifically in the United States. If your utility is located within the European Union, this may not apply.

What is the GDPR?

GDPR is an acronym for General Data Protection Regulation. The GDPR was passed by the European Union (EU) on April 14, 2016 with an implementation date of May 25, 2018, after which organizations found to be out of compliance can be fined.

The GDPR deals with safeguarding personally identifiable information (PII) and applies to organizations inside and outside the EU. According to the official GDPR website, it applies to “a company established outside the EU offering goods/services (paid or for free) or monitoring the behaviour of individuals in the EU.”

Do we need to worry about the GDPR?

The above cited website goes on to explain that the GDPR does not apply if “your company doesn’t specifically target its services at individuals in the EU, it is not subject to the rules of the GDPR.” Clearly, utilities target their services at customers who live or own property within their service area, not based on where the customer resides.

This article from Government Technology clarifies the issue even better, explaining that, even if your utility has customers who reside in the EU, information you collect for online bill pay or applying for service, for example. would not be subject to the GDPR.

Still responsible for PII of your customers

Of course, this doesn’t mean you have no responsibility for safeguarding personal information of your customers, only that, if my interpretation is correct, you aren’t subject to fines for violating the GDPR.

If you aren’t sure if you are adequately safeguarding your customer’s personal data, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help you determine this.

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© 2018 Gary Sanders

2018 Utility Staffing Survey Results – Part II

This is the second of two consecutive Utility Information Pipelines reporting the results of the 2016 Utility Staffing Survey. 82 utilities, representing 20 states, ranging in size from 134 to 90,000 active accounts participated in the survey.

Last week’s issue summarized the demographics of the survey respondents as well as staffing levels and factors outside the control of the utilities. Today’s issue deals with practices each utility can control, such as payment processing and bill printing.

In addition to asking the number of office employees, how many active customers, what services each utility bills, and annual customer turnover, the survey also asked how each utility handles various labor intensive processes.

Meter Reading Processing

In terms of office staffing, the real distinction in time savings in only between manually entering readings or importing them from some sort of automated reading process. However, unlike two years ago, this year’s survey did distinguish between whether the imported readings were from handhelds or an AMR or AMI system.

As expected, most utilities in the survey have automated their meter reading process. However, this year’s survey included 16 utilities that still enter meter readings, up from only five two years ago. Surprisingly, three of these utilities were in the upper 50% of most efficiently staffed offices. The others were all within the bottom third of least efficiently staffed offices, as represented by the graph below (clicking on any of the graphs will open a larger image in a new window).


 

Bill Printing

Bill printing and the related tasks required for preparing bills for mailing – separating postcards or folding and inserting full page bills, sorting, and traying the mail – are very labor intensive tasks.

Not surprisingly, the top three and 27 of the top 32 most efficiently staffed offices use an outsource printer to print their bills. On the other hand, only four of the 15 least efficiently staffed offices outsource their billing printing.


 

Mail Payment Processing

Mail payment processing is quite possibly the most labor intensive process in most utility offices. For that reason, many utilities have sought to automate the processing of mail payments, either by scanning barcodes on the bill, or using a remittance processing system or a bank lockbox.

As anticipated, 14 of the 15 most efficient utilities automate the mail payment process in some way, while 16 of the 21 least efficient utilities manually enter mail payments.


 

Phone Credit Card Payments

The final area the survey asked about is phone credit card payments. This can be an extremely laborious process considering the customer service representative must look up the account, tell the customer how much is owed, take the credit card number and process the payment authorization and, finally, enter the payment in the system.

Somewhat surprisingly, 5 of the 19 most efficiently staffed offices have a person in the office take phone credit card payments.


 

Is your office adequately staffed?

If you think your utility is understaffed or could operate more efficiently, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help you determine this.
 

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© 2018 Gary Sanders

2018 Utility Staffing Survey Results – Part I

For the past few months, I’ve been conducting the 2018 Utility Staffing Survey. This survey has become a biennial survey, alternating years with the Utility Fee Survey. The initial Utility Staffing Survey was in 2016 and, for sake of comparison, here are the results from that survey:

This is the first of two Utility Information Pipeline issues publishing the results of the 2018 Utility Staffing Survey. This issue will examine demographics of the survey respondents, staffing levels, and factors outside the control of the utilities. The next issue will examine staffing levels and practices each utility can control, such as such as payment processing and bill printing.

Demographics of survey respondents

82 utilities, representing 20 states,ranging in size from 134 to 90,000 active accounts participated in the survey. Click on the links below to see charts of the various demographic data for the survey respondents:

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

Accounts per employee

To arrive at an accurate index to compare utilities of differing sizes and billing frequencies, I came up with the number of accounts billed annually per employee. This formula multiplied the number of active accounts by the number of times each account is billed annually (12 for monthly billing, 6 for bi-monthly billing, 4 for quarterly billing, and 3 for three times a year billing) then divided that product by the total number of office employees. The higher the result, the more efficient the office should be.

The results ranged from 300 to 46,957 as represented by the graph below (clicking on any of the graphs will open a larger image in a new window).

One disclaimer applies. Two of the top five most efficient offices are local governments where payments are taken in a different department, so their staffing numbers do not include cashiers.

Annual customer turnover

I wondered if the turnover in customers would be a factor in how efficiently offices are staffed, so the survey asked how many applications for service (including routine move in/move outs and new construction) each utility processes per year.

Some utilities billing only property owners, and those will have a much lower turnover rate than utilities billing tenants.

Not surprisingly, the annual turnover rates ranged widely, from .05% to 45.63%. On the low end is a utility in a predominately rural area that only bills property owners. On the high end is a city with a large military installation nearby that bills tenants.

This year, unlike two years ago, there is a slight correlation between annual turnover rates and office efficiency. Of the 15 most efficiently staffed utilities, only four of them have annual turnover rates over 10% and only one of those is over 15%.

Major services billed

The final variable I examined for this issue was major services billed (water, sewer, electric and natural gas) looking for a correlation between the number of services billed and office staffing. I only considered the major services, because other services, such as garbage, stormwater, or area lights, generally are billed as flat-rate services and are not nearly as labor intensive to bill.

As was the case in 2016, utilities billing multiple metered services require more staff than those billing for only a single metered service. This was even more convincing this year, as 31 of the 32 most efficient offices bill for only one metered service, as shown below. The one anomaly also happens to be one of the utilities mentioned above that doesn’t collect payments.

Next issue

The next issue will analyze staffing levels and labor saving practices each utility can control, such as automation and outsourcing.

Is your office adequately staffed?

If you think your utility is understaffed or could operate more efficiently, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help you determine this.

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

© 2018 Gary Sanders

Do you separate your base charge…?

If your utility is like most, your rates include a base (fixed) charge in addition to the usage charge. The base charge, sometimes called an administrative fee, should generate enough revenue to cover the fixed costs associated with operating your utility. This includes things like the customer’s meter, the infrastructure necessary to provide service to the customer’s location, and reading the meter each billing period. Some water utilities charge different base charges according to the size of the meter under the premise that a larger meter costs the utility more to provide and maintain, both for the meter and the infrastructure to supply water to the meter.

Conversation with a customer

I’ve recently had a conversation with a customer who is considering separating the base charge from the usage component of his city’s water and sewer rates. There are pros and cons to doing this, so this issue will examine those.

Benefits of separating the base charge

The biggest advantage of breaking out the base charge from the usage charge is transparency for your customers. Showing each as a separate line on the bill more clearly communicates to your customers what they are being charged.

A second advantage of separating the base charge from the usage charge is it’s easier for your customers to see the impact of increased or decreased usage on their bill. This is especially true if you institute water conservation rates in times of drought and even more important if you have increasing block rates, so that your customers see the impact of their water consumption. If you’ve recently switched to increasing block rates and haven’t reevaluated how you bill for multiple units, you might want to read this.

The third advantage of splitting the charges is it’s now much easier to track the revenue generated from each component of your rate. Rather than seeing one combined total on billing registers and reports, you will now see separate totals for each.

Disadvantages of separating the base charge

The disadvantage to separating the base charge from the usage charge is customer education. This can be mitigated if you publicize the transition well enough but, in spite of your best efforts at educating your customers, some won’t realize the change is happening until they receive their first bill with the charges separated.

Several years ago, a customer that provides both water and sewer decided to break out the base charge from the usage charge for both services. This meant their customers went from receiving a bill with two line items – water and sewer – to a bill with four line items – water base charge, water usage, sewer base charge, and sewer usage. They didn’t publicize the change well and, needless to say, their phones rang off the hook. Customers, mistakenly thinking they were being charged for additional services, were irate. They ended up paying bonuses to their customer service representatives because of all the verbal abuse they took from customers!

So the moral of the story is, if you decide to do this, publicize it as much as you can well in advance!

Final week for the Utility Staffing Survey!

The 2018 Utility Staffing Survey will be closing on April 15 at midnight, so if you haven’t yet participated, this week is your last opportunity to do so. To complete the survey, please click here. This should take less than five minutes to complete. The results will be published in the next two Utility Information Pipelines.

Please feel free to share this survey with your peers at other utilities.

Thank you in advance for taking the time to complete the survey and for sharing it with other utilities.

Are your policies up-to-date?

If you are considering changing your rates or otherwise need help deciding how to best present information to your customers, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help your utility.

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

© 2018 Gary Sanders

What should a loose coin policy entail?

After the last Utility Information Pipeline issue dealing with a customer paying her entire $493 water bill in pennies as a “peaceful protest”, where I advocated for having a loose coin policy, a few readers inquired as to what a loose coin policy should entail.

Loose coin policy

At the very least, any loose coin policy should require that coins exceeding the amount required for a coin roll of that denomination be rolled. Standard coin roll denominations are:

  • pennies – $0.50
  • nickels – $2.00
  • dimes – $5.00
  • quarters – $10.00
  • half dollars – $10.00

It is also advisable to require your customer to write their name and phone number on each roll of coins in case there is a discrepancy in the amount of coins in the wrapper.

Obviously, you can use some discretion in enforcing the policy. If a customer showed up with 52 pennies to pay the exact change portion of their bill, it doesn’t make sense to require them to roll 50 of the pennies.

Benefits of a policy

With a loose coin policy in place, your office would be able to refuse to accept a wagon load of coins from an irate customer, such as the protest in the above story, unless the customer first wrapped the loose coins. This would save considerable time in counting the coins when they are presented for payment.

Have you completed the Utility Staffing Survey?

Just a reminder, if you haven’t yet participated in the 2018 Utility Staffing Survey, please click here to complete the survey. This should take less than five minutes to complete. The results will be published in a future Utility Information Pipeline.

Please feel free to share this survey with your peers at other utilities.

Thank you in advance for taking the time to complete the survey and for sharing it with other utilities.

Are your policies up-to-date?

If you don’t have a policy regarding loose coins, or feel like other policies may not be up-to-date, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help your utility.

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

© 2018 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



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