Memorandum

City of Lawrence

Finance Department

TO:	Thomas M. Markus, City Manager
FROM:	Kristy Webb, Utility Billing Manager Mike Lawless, Deputy Director of Utilities
CC:	Casey Toomay, Assistant City Manager Brandon McGuire, Assistant to the City Manager Bryan Kidney, Director of Finance Dave Wagner, Director of Utilities
DATE:	April 17, 2018
RE:	New Customer Information System (CIS) for billing and a Meter Data Management (MDM) system for the Advanced Metering Infrastructure (AMI) Project.

The project involves the procurement and implementation of a utility billing system (also known as CIS) and a meter data management system. Staff began working to procure a new billing system that could integrate with the advanced metering infrastructure project; provide operational efficiencies; provide improved reporting capabilities; and enhance customer service with better online access to account information, bill payment options, account changes, notifications, and detailed water usage information with advanced metering infrastructure implementation.

In 2017, staff presented a new water and sewer rate model to the City Commission as a part of the 2018 budget process. The existing billing system could not accommodate the new residential rate structure. Throughout the 2018 budget process and recommendation of rates, staff believed the new billing system could be implemented and online about the same time that the 2019 rates and new rate structure would go into effect. During the billing system vendor selection and negotiation process, it became apparent that this timeline was too aggressive. Development and implementation for the new billing system is scheduled to take 16 months to complete. The schedule will delay the implementation of the individual inclining block rate for residential customers until 2020.  This will provide time to perform discovery, design, and implementation of the new billing system.

Project Information:

The Capital Improvement Plan was structured to implement an advanced metering infrastructure system followed by replacement of the billing system to enhance customer service and take advantage of the information provided by the advanced metering infrastructure system. Once it was discovered that the current billing system did not meet the minimum requirements needed to implement the new rate structure and fully integrate with an advanced metering infrastructure system, staff began working to procure a new billing system ahead of the advanced metering infrastructure project.

Project Timeline

• SoftResources was engaged to assist in the development of a Request For Proposal (RFP) to select a new billing system.
• August 15, 2017 - Finance Department issued an RFP for CIS Replacement.
• September 15, 2017 - seven software companies responded to the RFP – Cayenta, Advanced Utility Systems, Cogsdale, Systems & Software, inHance, NorthStar, and TruePoint.
• Staff reviewed and scored all proposals. Based on those results staff invited Cogsdale, Advanced Utility Systems, and Systems & Software on-site to provide software demonstrations.
• Staff from Utilities, Finance, Information Systems, and Public Works participated in the software demonstrations.

Based on the results of the proposal reviews, software demonstrations, and evaluation of costs Advanced Utility Systems, a Harris product, was the highest rated vendor for the project. As part of Advanced Utility Systems’ RFP response, SmartWorks, also a Harris product, offered a 20% discount on their Meter Data Management (MDM) system as a value added product. A meter data management system is a key component to the advanced metering infrastructure project, in that it collects and stores all of the hourly meter data and then passes the appropriate data to the billing system. The value added to the project is the integration between the billing system and meter data management can be completed during the billing system implementation with the same integration team for consistency.

Advanced Utility Systems’ billing system solution includes the following modules – CIS Infinity, Infinity Link (customer portal), Infinity Mobile (work order management system), and Infinity.BI (advanced reporting tool). Implementation for the billing system solution is projected to take 16 months followed by three months of post implementation support.

The SmartWorks MDM solution includes the following modules – MeterSense MDM, Distribution Optimization, Process Automation, Weather, and CustomerConnect (customer portal). Implementation for the MDM solution will begin during the billing system implementation. It will not conclude until after an advanced metering infrastructure solution is selected and implemented. The two customer portals, Infinity Link and CustomerConnect, will interface seamlessly from the customer experience perspective to allow customers to pay bills, manage their account as well as monitor usage and predict water charges.

The benefits of the new billing system include, but are not limited to:

• Much-improved self-service for utility billing customers through an enhanced online customer portal. The portal will give customers the option to view or pay their bill; view usage history; update contact information; opt in or out of notifications including outage notifications; start, stop, or transfer service. With the customer being able to access so much of their information through the portal, it is expected that customers will need to make fewer calls to customer service.
• Currently there are over 6,000 online requests for starting, stopping, and transferring service each year. Finance staff must manually enter those requests into the billing system. The new portal will send those requests directly to the billing system with all required information already completed, which will save Finance staff a tremendous amount of time.
• Real-time integration with the third-party credit card processor, which allows for real-time posting of payments. Currently there can be a 48-hour delay in posting of credit card payments.
• Improved integrations of the various systems used by Utility Billing and Utilities, which will eliminate the need for double or triple entry of data.
• Allow for the collection and management of a customer donation program to help customers experiencing financial hardship.

Once the advanced metering infrastructure solution is fully implemented additional benefits include:

• Automation of the move in/move out process, which currently requires a truck roll for each incident. During the KU rush, an average of 2,800 move in/move out requests are processed in a ten (10) day period most of which require a truck roll.  

• Provide customers detailed water usage information including notifications for running water that are out of the ordinary, once the advanced metering infrastructure solution is fully implemented.
• With meter read data available on demand, it will eliminate the need for estimating bills during extreme weather conditions.
• Enhanced reporting capabilities that will improve business intelligence.

The contract with Advanced Utility Systems is $1,752,294, which includes one year of support and annual license fees. The annual support and license fees are $108,094 for the first year, with a 2.5% increase annually in the first two years and a 3.0% increase in years four and five.

The contract with SmartWorks will cost $169,063. Annual support and license costs are $71,063 per year for five years.

Project Funding

These items were in the 2018 Utilities Department 2018 Capital Improvement Plan for Automated Meter Reading Installation (2018 CIP # UT1898CIP).