utility information pipeline

Listservs and other resources

I’ve written in the past about resources I use to stay abreast of trends in the industry and to share my knowledge. I apologize in advance to those readers who aren’t based in North Carolina, because this issue is somewhat North Carolina-centric. North Carolina is where I live and has historically been where most of Logics’ customers are, so it’s the state I’m most familiar with. However, please don’t stop reading if you aren’t from North Carolina, because I’ve got a favor to ask of you later on.

Listservs I follow

If you’re not familiar with a listserv, once you’ve subscribed, you can ask a question of everyone on the listserv by sending an email to the listserv email address. Likewise, questions asked by others end up in your inbox and you can reply so everyone in the listserv sees your response.

Below is a list of the listservs I follow, in order of the most utility billing-related content:

  • NC Water listserv – topics dealing with water utilities, often related to utility billing and customer service.
  • NC Finance Connect – topics related to local government finance, occasionally includes utility billing and customer service.
  • NC City and County Manager’s listserv – topics of interest to city and county managers, rarely includes utility billing and customer service.
  • Virginia GFOA listserv – listserv for government finance professionals in Virginia, but with infrequent utility billing and customer service questions.

Why join a listserv?

I follow these listservs for two reasons. First, to lend my expertise when a question is asked for which I can provide an answer. Secondly, listserv questions are often a good source of ideas for newsletter topics. If someone has a question prompting them to ask how other utilities deal with that issue, it is often something I can elaborate on in a newsletter.

Rates dashboards

Another great resource is rates dashboards from the Environmental Finance Center at the UNC School of Government. The EFC has a series of rates dashboards for 18 states and Canada. To see if they have one for your state, you can check here, or below is a hyperlinked list of states, current as of the date of this newsletter:

You can use these rates dashboards to compare your utility’s rates to other utilities in your area, much like the Utility Fee Survey allows you to compare fees with other utilities.

“The book”

Speaking of resources and the UNC School of Government, Kara Millonzi, an attorney and professor at the School of Government, has written a book entitled Guide to Billing and Collecting Public Enterprise Utility Fees for Water, Wastewater, and Solid Waste Services. Written for utilities in North Carolina, this book answers many questions about what utilities legally can and cannot due. It cites the appropriate General Statute and case law, where applicable, to answer legal questions regarding billing and collecting for utilities in North Carolina.

If you work in utility billing in North Carolina and you don’t recognize this book cover,

do yourself a favor and click on it and order it now!

What resources do you use?

Are there similar resources you use when you need to find the answers to your utility billing questions? I would love to know what resources you use, especially if you are located outside of North Carolina. If there are listservs in your state, please feel free so share them by dropping me an email at gsanders@edmundsgovtech.com. Or, better yet, share them as a comment below so other readers can learn what resources you rely on.

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© 2019 Gary Sanders

2019 Utility Fee Survey Results – Part III

Over the course of the past few months, I’ve been conducting the 2019 Utility Fee Survey. This is an update to the original Utility Fee Survey in 2012 and subsequent fee surveys in 2015 and 2017. The survey was designed to research what fees utilities charge, how much they charge for each fee, and to see what trends, if any, are occurring with fees.

This is the third, and final, of three consecutive Utility Information Pipelines reporting the results of the 2019 Utility Fee Survey. 135 utilities, representing 22 states, ranging in size from 89 to 539,000 active accounts participated in the survey.

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, 2015, and 2017 Utility Fee Surveys:

The first results issue summarized the demographics of the survey respondents as well as water and sewer tap and impact fees. The last issue dealt with delinquent fees and policies. Today’s issue is the third and final survey results issue and recaps all remaining fees.

Returned check fees

All 135 participating utilities charge a returned check fee ranging from $10.00 to $50.00, as this graph illustrates (clicking on any of the graphs will open a larger image in a new window):

Interestingly, only 83 (or 61.5%) of the responding utilities charge the maximum fee allowed by their state. 24 utilities (representing 17.8%) charge less than the maximum allowed and 28 (or 20.7%) charge more than the maximum allowed.

If you’re interested in seeing how your fee compares to the maximum allowed for your state, here is a table with all 50 states.

Application fees

In one of the earliest Utility Information Pipeline issues, I wrote about application for service best practices. One of my recommendations was to charge a non-refundable application fee, in addition to any security deposit, to all new accounts. This year, 68 of the 135 utilities (representing 50.4%) responding to the survey charge such an application or administrative fee. This is up from 47.9% in 2017, but down from 51.9% in 2015 and 52.3% in 2012. These application fees range from $5.00 to $250.00 as shown below:

Transfer fees

This year, for the second time, the Utility Fee Survey asked how much utilities charge as a transfer fee for transferring service from one account to another. 62 of the 135 utilities (representing 45.9%) charge a transfer fee ranging from $5.00 to $100.00. This is up from 44.1% in 2017. Transfer fees charged by the responding utilities are shown in this graph:

Meter reread fees

28 of the 135 utilities (or 23.0%) charge a meter reread fee if the customer requests their meter be reread. This is down slightly from 23.7% in 2017 and 23.6% in 2015. In many cases, this fee is waived if it turns out the customer was correct and the utility misread the meter. Of the utilities that charge a meter reread fee, the fee ranges from $5.00 to $50.00, as this graph shows:

Meter tampering fees

101 of the 135 utilities (or 73.3%) charge a meter tampering fee. This is down from 77.1% in 2017 and 73.6% in 2015 but up from 60.2% in 2012. Seven utilities charge the actual cost of repairs or cost plus an administrative fee. One additional utility recovers their costs through the judicial system. Six utilities have an escalating fee that increases with each meter tampering offense. The remaining 87 utilities charge a flat fee ranging from $25.00 to $1000.00 as shown below:

Of the six utilities that charge an escalating fee, here are the charges for the first, second, and third offenses:

Convenience fees

One of my earliest issues explained why I believe utilities should accept credit cards. Of the 135 utilities responding to the survey, 122 of them (or 90.4%) accept credit cards. This is an increase from 89.0% in 2017, 81.1% in 2015, and 62.5% in 2012. Clearly, credit card acceptance has become standard practice for most utilities. Of the 122 that do accept credit cards, 85 (or 69.7%) of these charge a convenience fee on at least one method of credit card payments as shown below:

This is the second year the survey asked if the convenience fee is charged by the utility or by a third party. Of the 85 utilities that charge a convenience fee, 69 (or 81.2%) are charged by a third party as shown below. This is up from 69.4% in 2017.

The convenience fees charged by these utilities are too diverse in how they are assessed to be graphed, so they are presented here in a table.

Other fees

In addition to the fees that have been described in the three results issues, the survey asked what other fees utilities charge. Below I’ve listed a few of the more creative fees that were reported:

Meter test or calibration fee

At least 15 utilities charge a fee if the customer requests that their meter be tested or calibrated. The survey didn’t specifically ask about meter test fees however, most only charge the fee if the test results validate that the meter is registering correctly.

Return trip fee

When turning a meter on, most utilities will not leave the water on if the meter indicates water is running inside the house and no one is home. This requires the utility to make a return trip when the customer is home to turn the meter on again. Several utilities charge a return trip fee to cover the time and expenses involved in returning to the customer’s home.

Field collection fee

Most utilities have adopted the best practice of not collecting money in the field on cut-off day. At least one utility still allows customers to pay the field technician to avoid being cut off and they charge an additional $25.00 to provide that service.

A special offer

I still have a few slots left for the special offer I’m offering to the first five Utility Information Pipeline subscribers 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 919-673-4050 or e-mailing me at gsanders@edmundsgovtech.com. Remember, the special discount offer is only available to the first five people who respond!

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

© 2019 Gary Sanders

2019 Utility Fee Survey Results – Part II

Over the course of the past few months, I’ve been conducting the 2019 Utility Fee Survey. This is an update to the original Utility Fee Survey in 2012 and subsequent fee surveys in 2015 and 2017. The survey was designed to research what fees utilities charge, how much they charge for each fee, and to see what trends, if any, are occurring with fees.

This is the second of three consecutive Utility Information Pipelines reporting the results of the 2019 Utility Fee Survey. 135 utilities, representing 22 states, ranging in size from 89 to 539,000 active accounts participated in the survey.

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, 2015, and 2017 Utility Fee Surveys:

The last issue summarized the demographics of the survey respondents as well as water and sewer tap and impact fees. Today’s issue deals with delinquent fees and policies. The next issue will be the third and final survey results issue and will recap all remaining fees.

Late fees

Of the 135 participating utilities, 133 charge a late fee. As shown by this graph, charging a late fee as a percentage of the bill is the most popular method (clicking on the any of the graphics will open a larger image in a new window):

Compared to the 2017 Utility Fee Survey, utilities charging a percentage is down (52.6% vs. 59.3%), while those charging a flat amount is up slightly (27.8% vs. 26.1%). The largest increase is in utilities charging something other than a percentage or flat amount (up from 13.0% to 19.5%).

Utilities that assess the late fee as a percentage charge from 1% to 25%, with 10% again being by far the most popular, as this graph depicts:

Late fees range from $5.00 to $50.00 for utilities that charge a flat amount. This graph illustrates the late fee flat amounts:

Thirteen of the utilities (up from eight in 2017, a 62.5% increase) charge a hybrid late fee – a combination of a percentage with a minimum amount. Here is a graph showing what they charge:

Seven utilities charge a base amount plus a percentage as shown below:

While not technically a fee, this year’s survey again asked how, other than the utility bill, each utility notifies customers that a late fee or penalty has been applied. Here are the responses to that question (the total of all responses is greater than the number of participating utilities because some utilities use multiple methods of contact):

Cut-off fees

Seventeen of the 135 utilities do not cut off for non-payment. All of the 118 that do cut off for non-payment charge a cut-off or reconnect fee as a flat amount. Three of the responding utilities charge an escalating cut-off fee whereby the more times a customer is on the cut-off list, the higher the fee becomes. In those cases, the amount shown in the graph is for first offenders. Additionally, three of the utilities charge a separate disconnect fee and reconnect fee. In those cases, the graph represents the combined total of both fees. Finally, three additional utilities charge a cut-off fee per service. In those cases, the graph assumes all services are being disconnected.

Cut-off or reconnect fees charged by the 118 utilities range from $15.00 to $550.00 as shown below:

Of the 118 utilities that cut off for non-payment, 76 of them (representing 64.4%) assess the cut-off fee as soon as the cut-off list leaves the office. Surprisingly, the percentage of utilities charging the cut-off fee immediately is down 9.5% from the 2017 Utility Fee Survey.

Cut-off fee terminology

As utilities adopt the best practice of charging the cut-off fee as soon as the cut-off list leaves the office, many are finding that terms such as “cut-off fee”, “disconnect fee” or “reconnect fee” are becoming outdated. For that reason, the survey asked what each utility calls its cut-off fee. The results are displayed in the following chart:

For the number of responses, including the 26 terms included in the “other” category, please click here.

Again this year, Reconnect Fee is still the most popular term, but Non-Payment Fee has replaced Cut-Off Fee as the second most popular term, as many utilities adopt terms that do not refer to cut-off or reconnection. Calling your cut-off fee Non-Payment Fee, Delinquent Fee, Service Fee, or any of the other terms not implying cut-off or reconnection helps to avoid the inevitable arguments with customers who must pay the fee but have not been cut off.

As with late fees, the survey also asked how, other than the utility bill, customers are notified that they are about to be cut-off for non-payment. The responses are shown below (again, the total of all responses is greater than the number of participating utilities because some utilities use multiple methods of contact):

This year’s survey also asked how utilities notify customers after they have been disconnected for non-payment. The responses are shown below (again, a few of the participating utilities employ multiple methods of contact):

After hours reconnect fees

Of the 118 utilities that cut off for non-payment, 61 of them (representing 51.7%) will reconnect after hours and charge a fee for this service. This is down from 42.6% of responding utilities in the 2017 Utility Fee Survey. 43 of the 61 utilities (or 70.5%) will reconnect anytime after regular office hours. The remaining 18 utilities will only reconnect during selected time periods as shown below:

After hours reconnect fee amounts range from $15.00 to $300.00 as shown by the following graph:

Same day reconnect fees

A new question in this year’s survey asked how many utilities charge a fee for same-day reconnection for non-payment. Five utilities charge a fee for this service, ranging from $10.00 to $35.00, as shown below:

Next issue

Part III – October 29, 2019

The final survey results issue will showcase 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 subscribers 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 919-673-4050 or e-mailing me at gsanders@edmundsgovtech.com. Remember, the special discount offer is only available to the first five people who respond!

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

© 2019 Gary Sanders

2019 Utility Fee Survey Results – Part I

Over the course of the past few months, I’ve been conducting the 2019 Utility Fee Survey. This is an update to the original Utility Fee Survey in 2012 and subsequent fee surveys in 2015 and 2017. The survey was designed to research what fees utilities charge, how much they charge for each fee, and to see what trends, if any, are occurring with fees.

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, 2015, and 2017 Utility Fee Surveys:

This is the first of three consecutive Utility Information Pipelines publishing the results of the 2019 Utility Fee Survey. The other two installments will be published on October 15 and 29.

Demographics of survey respondents

135 utilities (a 14.4% increase from 2017), representing 22 states (a 15.8% increase from 2017), ranging in size from 89 to 539,000 active accounts participated in the survey. Click on the links below to see charts of the various demographic data:

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, square footage, or lot size, I assumed three bedrooms or 3,000 gallons per month or 1700 square feet or one-quarter of an acre.

Residential water tap fees charged by utilities responding to the survey range from $150.00 to $10,925.00 as shown below (clicking on the any of the graphics will open a larger image in a new window):

One other utility charges based on the time and materials cost incurred for a residential water tap at actual cost.

Utilities responding to the survey charge residential sewer tap fees ranging from $75.00 to $6,300.00 as depicted by this graph:

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

Residential water impact fees charged by utilities responding to the survey range from $11.60 to $4,000.00 as shown in this graph:

One additional utility charges water impact fees to commercial customers based on the type of business.

Utilities responding to the survey charge residential sewer impact fees ranging from $50.00 to $5,540.00 as shown here:

One additional utility charges sewer impact fees to commercial customers based on the type of business.

Upcoming issues

 

Part II – October 15, 2019

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

Part III – October 29, 2019

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 919-673-4050 or e-mailing me at gsanders@edmundsgovtech.com. Remember, the special discount offer is only available to the first five people who respond!

How to avoid billing “spikes”

Recently, one of my connections on LinkedIn, Glenn Barnes with Water Finance Assistance, shared this article about smart meters causing water bills to increase.

Meters are like people

It’s a well-documented fact that meters, like people, slow down with age. Therefore, installing new meters, whether they are smart meters or not, will likely result in increased water bills.

It is commendable that the town plans to conduct a public hearing to address the potential impact on customers’ utility bills. Anytime a utility can be transparent and forthcoming with their customer base about upcoming changes, particularly changes which will impact their customers financially, is a positive step.

Billing “spikes”

The article goes on to discuss citizen complaints about “intermittent spiking”. These spikes in monthly bills occur because bills are currently generated in thousands of gallons rather than in individual gallons. The article gives the false impression that it will take moving to smart meters to remedy this when, in actuality, these spikes are due to the TTWWADI syndrome – continuing to do something because it’s always been done that way.

Chances are, meters are still being read and billed in thousands of gallons because this is the way it was done decades ago. Back then, meters were read on paper and bills were produced manually, or with ledger card machines (if you don’t know what that is, thank your lucky stars!).

Even when reading with handhelds (or still on paper, if you’re that outdated), meters can be read and billed in individual gallons. It takes some changes to the existing database, but it’s not rocket science!

Revisiting an example

I originally wrote about this topic eight years ago, in this post where I showed examples of how truncating readings to the thousands place can impact billings.

The following issue discussed the impact of billing in thousands on conservation efforts, as compared to billing in gallons.

The examples in the original post were rates with a base rate of $25.00 for the first 2000 gallons and $4.00 per thousand gallons above the minimum. From their website, the town mentioned in the article has rates of $25.07 for the first 2000 gallons and $12.54 per thousand gallons above the minimum – quite a difference from the original example!

Let’s revisit those original examples using the rates for the town referenced in the article:

First, the account that was billed more by billing in gallons (clicking on either of the tables will open a larger image in a new window):

And here is the account that was billed more by billing in thousands of gallons:

The graph at the top of the article is based on the first table where the customer would be billed more by billing in gallons. Looking at the blue bars in the graph, it’s easy to see how a customer using just over the minimum can think their bill is higher than it should be once it “spikes” above the minimum.

For eight consecutive months (September to April) this customer would have received a minimum bill. Then, in May, when their accumulated usage rolls to the next thousand gallons, suddenly their bill is 50% higher! Imagine if they had used 110 gallons more in May – then their bill in thousands would have been for 4000 gallons, resulting in a bill double what they had been used to!

Clearly, billing in gallons provides your customer with a more accurate bill each month. Any fluctuations from one month to the next are based on actual usage, not the anomalies of whether their reading rolls to the next thousand gallons or not.

Need assistance?

If you are in the process of replacing meters and need assistance explaining this to your customers or if you are currently billing in units greater than individual gallons, such as hundreds or thousands of gallons, please give me a call at 919-673-4050, or email me at gsanders@edmundsgovtech.com for more information about how a business review could help you.

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

© 2019 Gary Sanders

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Gary Sanders

I am the Senior Consultant with Edmunds GovTech | Logics 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 919-673-4050 or sending an email to gsanders@edmundsgovtech.com



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