This is a report by City Director of Finance Bernie Hayen to on Fehr, City Manager on the Colbert Hills Golf Course - Water Consumption:
Iím sure you recall that in early August you asked me to head a task force designed to establish measures that would ensure better accountability in the production, distribution, and measurement of final consumption of City water. At issue was the recent discovery that the large 6-inch meter at Colbert Hills Golf Course had been misread for nearly three years resulting in a significant under billing to this water customer.
In order to better understand how this error occurred, I want to give you a quick review of the factors that I believe contributed to this under billing. Although no single factor (listed below) satisfactorily explains why this error was left unattended for nearly 36 months, any combination of these factors could certainly produce the confusion and lack of attention to detail that occurred.
* Unfamiliarity with this type of large water meter. With over 12,000 water meters across the City, there are only fourteen meters 6-inch or larger throughout the water distribution system. Not all of them are read the same way. In particular, the new meter installed at Colbert Hills is read by six-dials while most large meters are read as five-dials. I understand from the Cityís meter reading crews that the vendor supplying the Colbert Hills water meter never provided training as to how this meter was to be read.
Subsequently, it was read as a five-dial meter, which resulted in reporting water use that was only 10% of the actual total consumed.
* Initial problems with the new meter. Within the first six months of the installation at Colbert Hills, the new meter quit operating and required several replacement parts. During this time, the monthly bill was estimated on the initial first six months average, which, we now know, was erroneous.
* Apparent miscommunication between the City and Colbert Hills. As I mentioned above, the City maintains a considerable number of water meters - the majority of those being residential meters. Typically, if a residence receives a utility bill where the water consumption is considerably more than the previous month, that residence will contact the City to inquire why. Conversely: if a residence receives a utility bill where the consumption is considerably less than the previous month, that residence invariably will contact the City to inquire why.
It is unclear why the under-billing was never questioned by the staff at Colbert Hills.
* A lack of adequate safeguards within the Cityís monthly production/consumption reports. Notwithstanding the above factors, I do not believe the City had sufficient safeguards in place to ensure that misread meters and subsequent major under billings would be quickly detected. Unfortunately, several utility consumption reports generated monthly by the utility billing software could have "flagged" the under billing at Colbert Hills much earlier but apparently were not used.
In response to these factors - especially the lack of adequate safeguards - I have directed (through the task force) the following changes to be made immediately:
(1) Beginning the first of October and consistently thereafter, a new monthly report will be generated from my office to you that summarizes total water production at the water plant and subsequent total consumption by customer class. A prescribed ratio of acceptable City water loss will be established. Any variance from this ratio and all substantial variances among customer classes will be reconciled immediately.
(2) Accompanying this report will be listing of the water systems major users for that month. Each major user will have a pre-established "reverse override" average consumption number. If that user falls above or below this number, a special exception report will be generated.
(3) All new commercial/industrial/university large water users will be identified on the aforementioned monthly report and tracked individually for a period of six months alongside a pre-existing similar large water user to ensure comparability in monthly water consumption.
Finally, I remain concerned that those charged with the responsibility of reading meters across the City apparently are never privy to the sizing or placement of meters until after they are in service. It appears that the City should select, install and own these meters in order to ensure their proper function and maintenance rather than allowing the customer to provide these large meters.
I would be happy to respond to any questions that you might have. Please
let me know.