Sewerage Water Board of New Orleans City Council

Sewerage & Water Board of New Orleans City Council Public Works Committee Meeting October 6, 2015

Agenda § Reform Benchmarks § Sewerage and Water Board Pension § Overtime Payments Sewerage & Water Board of New Orleans 2

Reform Benchmark Sewerage & Water Board of New Orleans 3

I. Governance Practices Action Item Status Reduce the length of Board member terms and limit the number of terms Completed June 17, 2013 Establish requisite qualifications for Board members Completed June 17, 2013 Reduce the number of Board members Completed June 17, 2013 Appoint Board members from recommendations submitted by university presidents Completed May 22, 2014 Review function and responsibilities of Board committees Completed August 19, 2015 Establish dedicated independent Ongoing oversight of Sewerage and Water Board determined by the City Council Sewerage & Water Board of New Orleans 4

II. Customer Service Improvements A. The new meters will be installed for the residential and small commercial customer base. • • • New electronic-read meters are being purchased and installed Additional smart technologies are being evaluated for possible concurrent implementation Target implementation date December 2016 Sewerage & Water Board of New Orleans 5

II. Customer Service Improvements B. Open Additional Customer Service Center to provide convenient access to full service capabilities for customers without traveling to the downtown location. • New center opened in Algiers • Identifying possible facilities for reuse as Customer Service Centers • Customers made 40, 891 payments totaling $4. 7 million at Fidelity Express locations during past twelve months. Sewerage & Water Board of New Orleans 6

II. Customer Service Improvements C. Replace existing billing application with new software that includes online customer account management capabilities. • • Customer Account Management System setup and training began in September 2014 Target implementation in Second Quarter 2016 Sewerage & Water Board of New Orleans 7

II. Customer Service Improvements D. Replace existing work order application with new software that includes online work order tracking and appointment scheduling capabilities. • • Next steps to be determined as part of the development of an Information Technology Strategic Plan Target date December 2017 Sewerage & Water Board of New Orleans 8

II. Customer Service Improvements E. Improve efficiency and reliability of Customer Service processes. • Increase perceived accuracy of bills to reduce volume of calls • Ensure meter reading and billing edits are worked diligently Sewerage & Water Board of New Orleans 9

II. Customer Service Improvements F. Improve the customer experience when questioning a bill and resolve more issues during the first call. Provide more effective appeals process. • Customer Service Improvement Plan results show significant improvement in meter readings, call wait times, call answer rates, and collections • New appeals process implemented Sewerage & Water Board of New Orleans 10

III. Service Assurance Program A. Provide additional funding for bill payment assistance through the Water Help program. • Increased from $60, 000 to $240, 000 in January 2013 • Process with TCA streamlined in June 2015 to simplify and expedite the process Sewerage & Water Board of New Orleans 11

WATER HELP • A program for low-income elderly and disabled residents • Residents may qualify for up to $200 annually in bill assistance • Residents may also qualify for up to $250 annually in minor plumbing repairs • Work performed by a Licensed Master Plumber Sewerage & Water Board of New Orleans Total Community Action 1424 South Jefferson Davis Pkwy www. tca-nola. org 504 -324 -8609 12

III. Service Assurance Program B. Pursue legislative change to allow adjustments for water lost through customer leaks. • Changes approved by State Legislative allow SWB to develop and implement a leak adjustment process - Ongoing • Target implementation - December 2015 Sewerage & Water Board of New Orleans 13

III. Service Assurance Program C. Evaluate waiver of service charges based on means testing for qualifying low-income elderly and disabled customers. • Staff recommended that the Board not adopt a waiver of these service charges based on means testing and that overall effectiveness of the service assurance program be reviewed prior to reconsideration of this matter. Sewerage & Water Board of New Orleans 14

III. Service Assurance Program D. Evaluate reduction in late payment fee, disconnect fee, returned check fee, and deposits. • Revenues from the new rates were not sufficient to allow for this offsetting reduction in fees while still accomplishing other financial objectives Sewerage & Water Board of New Orleans 15

IV. Operational Reforms A. Improve operations through performance measures, improved framework, and follow-up reviews to reduce future rate increases. • Training for process documentation, analysis, and improvement combined with cost reduction completed • Performance measures being developed and reviewed Sewerage & Water Board of New Orleans 16

IV. Operational Reforms B. Reduce free water and sewer service provided to municipal accounts by fifty percent from a baseline of 2010 usage. • Quantity of free service reduced from 2010 to 2014 by 25. 6% Sewerage & Water Board of New Orleans 17

IV. Operational Reforms C. Improve coordination between Sewerage and Water Board and Department of Public Works. A joint team of SWB engineers and DPW engineers work together in coordination of planning and construction for the FEMA Recovery Roads program. 7 – Completed 7 – Construction 4 – Bid/Award 56 – Design Sewerage & Water Board of New Orleans 18

IV. Operational Reforms D. Improve ratepayer collections. • Plans to improve collections have focused on ensuring close compliance with schedules for non-payment turn-offs • The amount written off as uncollectable has reduced from 10. 23% in 2010 to 1. 15% in 2014 Sewerage & Water Board of New Orleans 19

IV. Operational Reforms E. Develop a long-term staff succession and training program. • Delgado Community College, the Sewerage and Water Board of New Orleans and the JOB 1 Business and Career Solutions Center partnered to launch a worker training program • Aimed at increasing the pool of certified water and wastewater treatment personnel Sewerage & Water Board of New Orleans 20

IV. Operational Reforms F. Perform annual water audit to measure progress and critical needs. • Water Audits have been performed for 2008 through 2014 Sewerage & Water Board of New Orleans 21

IV. Operational Reforms G. Enhance long range planning by developing a Facilities Plan for 2015 -2035. • Water Purification Facilities Plan for 2015 -2035 developed to identify the capital investments beyond the immediate needs identified in the current capital improvement program Sewerage & Water Board of New Orleans 22

IV. Operational Reforms H. Develop new sources of funding other than water and sewer rate increases. • New revenue stream established for handling wastewater from mobile containers, such as portable toilets and shipping containers • Analyzing opportunities for providing wholesale water service over long distances Sewerage & Water Board of New Orleans 23

IV. Operational Reforms I. Repay funds owed to DPW. • SWB repaid $4, 763, 858. 77 at year-end 2013 • No repayment in 2014 due to offsetting receivables from DPW Sewerage & Water Board of New Orleans 24

V. Economic Opportunities A. Create economic opportunities consistent with City of New Orleans programs for participation by economically disadvantaged and local business enterprises. 2014 Results Good and Services $ 256, 644 Construction $14, 367, 582 Professional Services $ 5, 237, 764 Sewerage & Water Board of New Orleans 22. 87% 30. 39% 20. 35% 25

VI. Capital Improvement Program A. Water System Improvements Replacement and rehabilitation of water purification plant facilities. Replacement and rehabilitation of water pumping facilities. Replacement of water system transmission and distribution mains - $277, 000 • Water System Capital Spending 2014 § $46, 602, 825 Sewerage & Water Board of New Orleans 26

VI. Capital Improvement Program B. Replacement and rehabilitation of sewer system collection pipes required by Federal Consent Decree $314, 000 • Sewer System Capital Spending 2014 § $58, 730, 088 Sewerage & Water Board of New Orleans 27

VII. Water Stat Reporting and City Council Oversight A. Establish performance measures and targets as well as reporting methodology. • Measurements framework adopted, initial measurements identified, and measurements training delivered to senior management • Collection of performance data in progress Sewerage & Water Board of New Orleans 28

VII. Water Stat Reporting and City Council Oversight B. Implement a systematic approach to process documentation, analysis, and improvement. • Training program developed and delivered for business skills training Sewerage & Water Board of New Orleans 29

VII. Water Stat Reporting and City Council Oversight C. Perform follow-up reviews to document results and efficiencies achieved. • Documentation and reporting of improvement results occurs monthly at Finance and Administration Committee and Quality of Life Stat meetings Sewerage & Water Board of New Orleans 30

VII. Water Stat Reporting and City Council Oversight D. Provide maps showing maintenance work completed, capital projects completed, and planned capital improvements. • Integrated website of all projects planned and ongoing at Roadwork. nola. gov Sewerage & Water Board of New Orleans 31

VII. Water Stat Reporting and City Council Oversight E. Document FEMA receipts and uses of funds. • Summary of FEMA receipts and uses of funds is provided to Board committees each month Sewerage & Water Board of New Orleans 32

VII. Water Stat Reporting and City Council Oversight F. Initiate annual meetings with citizens of each council district to regularly report on organizational performance results. • Staff attends and presents regularly at district meetings hosted by the Mayor, SWBNO, USACE, DPW and City Council members Sewerage & Water Board of New Orleans 33

VII. Water Stat Reporting and City Council Oversight G. Provided written updates to the Clerk of the City Council. • Presentation to Public Works Committee of City Council as requested on identified questions and concerns Sewerage & Water Board of New Orleans 34

Statistics 88. 5% on target or completed. Sewerage & Water Board of New Orleans 35

SWB Pension Sewerage & Water Board of New Orleans 36

Pension Statistics • Funded Ratio 78. 4%. • Employer Contribution Rate 22. 573%. • Employee Contribution Rate 6. 000%. Amortizing Unfunded Actuarial Liability over 25 years. • Pension Asset $236. 5 million. • Unfunded Actuarial Liability $68. 3 million. Sewerage & Water Board of New Orleans 37

SWB Pension Strategy • Pension Committee working timeline April 2015 to February 2016 to review equity, fixed income, and alternative investment allocations and managers performance. Sewerage & Water Board of New Orleans 38

SWB Pension Next Steps • Shifting away from commodities investments to equity and fixed income investments only. • More frequent reviews of active managers performance. • Initiating Compensation and Benefit Study to consider potential shift from Defined Benefit to Defined Contribution pension. Sewerage & Water Board of New Orleans 39

Overtime Payments Sewerage & Water Board of New Orleans 40

Overtime • We have a vital mission of public health and fire protection. • We understand the community’s expectations. • We are staffed for most scheduled work and rely on overtime for reducing the back log and emergency work. • Our work requires a skilled workforce. Sewerage & Water Board of New Orleans 41

Overtime • We are integrating our work with other large programs. • We know where the overtime is being spent. • We are busy at work. Responded to 14, 474 service requests in 2014 within an average of 2 hours and 38 minutes. • We are committed to growing the workforce. We have added 111 jobs as a result of having increased revenue. Turnover at 12. 2% of workforce in 2014. Sewerage & Water Board of New Orleans 42

Overtime • • We are committed to managing the workforce. We are disciplining for poor performance. We are committed to improved internal control. We are targeting new hires to achieve business objectives including control of overtime. • We are committed to make significant improvements. Sewerage & Water Board of New Orleans 43

Overtime • SWB intends join with other agencies that have similar round-the-clock public safety responsibilities to request a waiver from the Civil Service Commission by December 31, 2015 to permit overtime hours necessary to maintain continuous water, sewer, and drainage services. • SWB has communicated procedural expectations and consequences for violating S&WB policies to employees. • SWB has developed and implemented overtime monitoring controls. • Work schedules and crew sizes will be analyzed with consideration for adjustment by June 30, 2016. Sewerage & Water Board of New Orleans 44