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5. Y2000 Utility Billing ProgramDate: September 3, 1998 TO: Mayor Boharski & City Council From: Amy Robertson, Finance Director RE: Y2000 - Utility Billing program I believe that the City needs to make a decision regarding the utility billing system and I believe it is urgent. I will try to present all of the information that we have gathered and the concerns that we (Glen & myself) have regarding our current situation. First of all, we have been a client of United Software Technology formerly known as Big Sky Data Systems since 1984. This software is not year 2000 compliant. In 1996 UST presented us with a proposal to upgrade all of our software to year 2000 for just under $20,000. This included "Progress" licensing for the client server and the users, data conversion, on site training and implementation. The software upgrade is to include Systems Management, General Ledger.Budget Management, Accounts Payable, Payroll, Fixed Assets, Utility Billing, Encumbrances/P.O.'s, Accounts Receivable and Check reconciliation program. The ones underlined are the ones which have been completed to date and are year 2000 compliant. The Utility billing - accounts receivable package is the most critical as we cannot generate water bills after year 2000. We have paid $16,000 to date. The owner of UST, Gary Orser, has been an absentee owner until this year. He has decided to reorganize the company into an "internet company" as he calls it. They have closed their offices, disconnected their phones and so can only be contacted by mail or E-Mail. He has decided that they will only service the software and will no longer install or maintain hardware systems or networks. The owner has also laid off all of his employees and contracted back with a few of them for programming. To my knowledge there are two programmers in Billings and one part time here in Kalispell (John). John is still working on our payroll program as we are the beta test site for payroll. In my discussions with Gary he indicated that the utility program would be available next summer `99. I told him we were very concerned about waiting that long and were going to look at what else might be available. That got his attention and now he wants to come here in November and beta test Utilities here. All of our data and customer history must be converted to the new format. We do not know what their product will look like. Being the test site has some advantages as we get more input. We also have to deal with the bugs. The programmer writing this program is in Billings. Gary has said they will do this for the remaining $4,000 plus travel expenses. He has made no mention of the fixed asset program or the encumbrance program. They are not a critical for Y2000. The concern that we have with UST is that we cannot predict the future. If six months from now they are gone, What do we do? I have talked with former employees who have had to go to the labor board to get their final pay. To my knowledge UST has not filed for bankruptcy. Some of their customers have left. We have a lot invested in the programs which we have. The programs and the service have been just fine in the past. Glen and I contacted Ben Smyth of Aurora Logic in Whitefish to do some research for us. Ben is a former employee of UST, although he left UST some time before these changes came about. Ben is very familiar with our system and has agreed, for the time being, to help us with our network maintenance. He researched nine Utility Billing companies listed in the GFOA software reference guide. He came up with two which would work on our system and has contacted them for quotes and time frames. Even if we act now it would be January or later before we could be installed. The two companies are American Data Group (ADG) from Englewood Colorado and Donald Frey & Co. (called Cubic Utility Billing Software) from Fort Thomas, Ky. Both of these companies are considerably larger than UST. The Frey company is the bigger of the two and has 40-50 utility customers and 100 accounting customers. Both of these companies also have the other accounting packages which we use. Both of their programs are compatible and can interface with our General Ledger. ADG programs in "Progress" which is the language that UST has programmed our software in. The Frey company programs in Y2000 "COBOL". I think Ben prefers COBOL. as a programmer but admits that Progress reports are more user friendly. The Frey groups program includes bar coding and cash register interface with software. Two nice features but not required. Preliminary estimates are between $15,000 and $22,000 including conversion and training. One benefit of the ADG company, since they use "progress", we would not have to re -license if we were to buy any of their other programs - G/L, payroll, etc. The situation is that I have $4,000 carried over in the data processing fund. The cost of purchasing another company's product will be in excess of $15,000. I would insist on having Ben here for any install. This cost would be shared by water and sewer funds. We can stay with UST but we may end up doing this at a later date. If we change now, I can't predict how UST will react. We must still rely on them for all of our other programs. It is critical that we have maintenance. An example, last month the power went out while we were printing checks- we had to call UST to go in to the program and restart the check select process. The other companies which we are looking at do have packages for the other applications which we use. Also, a reminder that UST has increased maintenance fees from $3,795 to $11,320 per year. The new fee structure entitles us to 4 hours a month but at $60 per hour that is still a substantial increase. Glen wrote UST a letter in June requesting a written contract specifying what we would be getting for our $11,000. We are still waiting on that and so are only paying one month at a time for maintenance. Mr. Orser says we signed the agreement in 1984 as if that would still apply today. We asked for a copy but no response. The direction that we are seeking from the Council is - Do we continue down the road with UST and hope for the best or do we pursue the other option? We are not asking you to decide between these other companies as we would still need to check references and availability. The closer we get to year 2000 the more difficult and probably more expensive this will become. The other option will need budget authority.