Birmingham Water Works audit shows billing problems started earlier, more widespread than utilities admitted

BIRMINGHAM, Ala. (WBRC) – A new audit of the billing issues which afflicts the Birmingham Water Works Board finds that the backlog of unread meters or unissued bills started much earlier than thought, affected more customers than was previously publicly acknowledged and blames utility management a lack of training, staffing and knowledge of basic processes in key areas of billing operations. The audit also alleges that utility management may have misled the Council about the extent of the problem and whether it has been resolved and warns that issues may still not be resolved. The audit also warns that changes are needed to ensure that the same issues do not reoccur.

The company of former BWWB chief executive Mac Underwood carried out the audit, commissioned by former BWWB board chairman Chris Rice, ahead of his resignation. This was prompted by complaints from customers who went months without receiving an invoice and then received multiple invoices for several months at a time.

The company of former BWWB chief executive Mac Underwood carried out the audit, commissioned by former BWWB board chairman Chris Rice, ahead of his resignation and prompted by complaints from customers who went months without receiving a bill, then received multiple bills for several months at a time.

When the WBRC began reporting on this issue in February, BWWB chief executive Michael Johnson said the utility was about 10 days behind and was trying to catch up. The Underwood audit shows that at that time the utility was behind on more than 68,000 of its roughly 200,000 residential accounts. The audit shows the billing issues started at least in August 2021, but auditors say it could have started even before that.

As this graph from the audit shows, water works already had over 21,000 overdue accounts at the end of September 2021 and over 84,000 overdue accounts at the end of December – the same month the utility has fired 3 billing department employees for allegedly falsifying meter readings – charges the employees deny. Two of those employees told WBRC that they had alerted utility management to problems in the billing department months before. WBRC obtained recordings and emails of similar warnings in December – but by then the backlog had grown to encompass nearly half of the utility’s residential customers, according to the Underwood report.

The audit finds the utility began to catch up in the spring months, but Rice told the Underwood team that BWBW management told him in early July that all unbilled accounts had been cleared. resolved by the end of June 2022, when in fact the report reveals that “there were over 25,000 active accounts not billed, meaning meter readings, and billing continued to lag , resulting in billing delays.

More than 8,800 Water Works customers may have been unfairly charged higher rates in the past year because their meters were not read in less than 37 days within the court-ordered time frame and BWBW policy, according to the Underwood audit. The utility’s three-tier rate structure charges customers more per CCF of use the more they use, which would mean that customers who aren’t billed on time could be charged more per gallon than they would if their meter was read on time.

For example: if Customer A uses 6 CCF ($46.12) for the regular January billing cycle, 9 CCF ($58) for the February billing cycle, and 8 CCF ($54.04) for the of March, he will pay a total of $158.16 for these 3 months. according to correct invoicing procedures. But if their meter was only read at the end of those 3 billing cycles and they were billed for the 23 CCFs at the same time, they would pay $189.72 for the same amount of water.

The audit finds the utility billed 2,528 customers for more than 37 days in December 2021 alone.

The Underwood team also found that Birmingham Water Works’ system is experiencing “a high number of implausible counts”, or meter readings entered into the system that are so out of step with that customer’s normal history, that the system flags the account and does not. t issue a bill until someone in the billing department can request a meter readback and/or enter and manually adjust the account.

Underwood says these issues forced the BWWB team to spend “a lot of time, effort and money to adapt…the team averaged over 100,000 monthly transactions. There are clearly issues with the billing process that require manual adjustments…these issues persisted at least through the end of August 2022.”

Who is to blame? The audit places much of the blame on the utility’s management team, warning it “may not have been fully trained on certain aspects of SAP’s billing system, which caused problems communication as well as inaccurate reports”. The audit goes on to say that the SAP system can generate a report that shows all unbilled accounts, and running this report was standard procedure from the system’s installation in 2016 until 2019 and would allow the utility to erase these “implausible” readings in 3-5 business days. But the review found that the BWWB had not executed this part of the report from November 2021 to July 2022 – calling this a “major factor which has contributed to the backlog of unbilled account issues, as the business does not ‘may not have been aware of all the unbilled issues’. accounts.”

Auditors found more than 500 cases from November 2021 to July 2022 where the utility failed to process ‘move orders’ where customers moved from one location to another – meaning those customers can having gone months before receiving their final bill from their old location and delaying the billing of new residents by several months.

The Underwood team say a major turnover in the billing department began in 2019 when a long-time BWWB employee moved to the position of customer support department manager – and within months , the department was made up of new employees from the invoice management and editing team who may not have been fully trained in how to operate the complex invoicing system.

How do you fix this? Underwood’s report recommends that CEO Michael Johnson and several of his senior managers receive more external training on the billing system, recommends more training for employees in the billing department, eliminating the practice of “estimating mass” of customer bills, changing the utility’s policies to fully utilize the information-gathering potential of its already-in-place but currently underutilized software system, and potentially hiring more outside consultants to review and improve the information-gathering process. billing.

See more 6 On Your Side investigates the stories of Birmingham Water Works here.

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