How rapid response and thoughtful policies can benefit utility customers and lessen revenue impacts

Delinquent Account Management and Customer Assistance Programming


The Challenge

Across the country, utilities have suspended collections activities on customer accounts as the COVID-19 pandemic has flared, schools and businesses are shut down, and unemployment has soared. Now, utilities are beginning to grapple with how to adapt their policies and procedures to address delinquent account management and customer assistance programs. The COVID-19 pandemic has radically altered the economic environment of utilities and the communities they serve, so adapting to this reality requires a thoughtful response.

The Solution

Raftelis has developed an approach that supports utilities in this challenge. This roadmap addresses clients’ needs in four steps: rapid assessment, alternatives development and decision making, process optimization, and communication. Raftelis also offers implementation support services in financial planning and rate structure analysis, technology assistance, and program assessment. This approach draws upon Raftelis’ depth of experience and decades of service to local governments, supporting clients as they make difficult decisions and overcome new challenges.

Utilities in Action Through Each of the Four Steps

Step 1: How bad is it and how bad will it get?

The first step is to understand the situation in detail and to track trends over time to inform policy options and decisions. This includes analyzing customer level data and trends and performing a rapid affordability assessment. Since the data will need to be compiled and updated over time, Raftelis sets up repeatable data extraction and analysis processes and models to support the effort. Examples where Raftelis is providing this assessment support:

Akron, OH, where the financial forecasting effort includes tracking production and billings by class and compares them to previous periods.

Philadelphia, PA, where Raftelis is producing bi-weekly reporting on consumption, billings, and payments to assist the City with trending analysis.

Raftelis is a leader in the affordability space and has performed affordability assessments for over 30 communities, large and small, in more than 15 states and the District of Columbia. Some examples include Birmingham, AL; El Paso, TX; and Richmond, VA.

Raftelis routinely analyzes large datasets for billing, collections, customer service, and operations and is accustomed to connecting with and extracting data from customer, financial, and regulatory information systems. Clients for this set of services include Pittsburgh Water and Sewer Authority, PA and Jackson, MS.

Step 2: What do we do about it? What are our options?

The second step is to develop options, make policy selections and develop an action plan. This step draws upon data related to the extent and severity of delinquency and the affordability environment in the community. Raftelis examines existing delinquency policies and customer assistance programs, if applicable to assess their efficacy. New or changed options regarding payment plans, shutoff moratoriums, returning accounts to service, late payment penalties, payment methods, and bill forgiveness are then identified. This step also includes data collection from regional and peer utilities and analysis of state and regional guidance and requirements. The options are developed and analyzed and short- and long-term policies are selected. The selected polices are associated with a plan of action, expected outcomes for the policies, plans for measurement and measures of success.

Raftelis routinely provides policy analysis and decision support to our clients, both in affordability issues and other arenas. Examples of work in this area include Philadelphia, PA, where Raftelis is supporting the development of a robust customer assistance program and supporting decision-making on customer affordability. Detroit, MI asked Raftelis to provide decision-support on possible rate structure changes drawing upon detailed customer billing and Census data.

Step 3: How do we optimize our process to accommodate the plan?

With policies established and plans of action in place, the next phase is to ensure that the organization is prepared to implement the plan. This step encompasses assessment of capacity to implement the policies in areas such as internal capacity to process volume of customer inquiries; payment plans and assistance applications processing; and development of effective processes to ensure timely customer service provision.

Raftelis excels in operational assessment and process optimization. Our past and ongoing projects include: Baltimore, MD has involved Raftelis in a large-scale operational optimization initiative. The effort is designed to enhance organizational alignment and operational efficiency; identify organizational structure improvement opportunities; and establish a framework to support the leadership team’s vision for continual improvement in operational performance. Raftelis’ “deep dive” interviews and assessments included work with customer service functions in support of the strategic goal of Customer Satisfaction and Communication.

Meter-to-cash, operational assessment, and customer service projects in which processes and policies such as disconnections, leak policies, referrals to outside collections were assessed include Philadelphia, PA; Pinellas County, FL; Clearwater, FL; Montgomery County, OH; and Richmond, VA.

Step 4: Document the program and communicate

The delinquency and customer assistance policies can be packaged into an overall, holistic program. The utility’s approach and policies and customers’ opportunities for assistance will need to be communicated clearly. It’s best that the utility develop an outreach and communication plan to reach customers in need to obtain maximum customer participation in the program.

Raftelis has proven ability to successfully communicate and build consensus on large, complex, and often controversial projects – and we’ve walked in your shoes, working directly with customers, stakeholders, elected officials, media, and environmental organizations to engage and collaborate with them. Our engagements specifically relate to promoting customer assistance programming include work for Richmond, VA where we supported the utility in assessing and building its current community partnerships and in develop a communications plan to connect customers to available financial assistance.

To learn more, view our insight on Delinquent Account Management Plan and Customer Assistance Program, or explore how Raftelis can help you.