Delays for the New Utility Billing System
The New Customer Information System (NCIS) is a joint Seattle City Light (SCL) and Seattle Public Utilities (SPU) project to replace the Consolidated Customer Service System (CCSS) – the existing SCL and SPU billing system. The CCSS supports billing and customer processes for both utilities, but fails to meet current business practices and is no longer supported by the vendor.
The NCIS is intended to improve operational efficiency, provide better customer communication options, offer increased financial control and auditing, and improve customer data security. In 2015 the Council approved a project budget for a total of $66 million – about 56% of project costs to SCL and 44% to SPU.
On Monday, the Council hosted Department Directors from SCL, SPU, and the Department of Information and Technology at its Monday morning briefings meeting in response to the news that the project was over-budget and off-schedule. Although the 2016 approved budget included an additional $19 million, over the $66 million originally budgeted for the project, resulting in a total project budget of $85 million; the Executive failed to highlight this change in the budget process. Consequently the Council only learned of the increase in budget last week and then we learned that the project budget had actually increased to over $100 million. The Council Briefing meeting was an opportunity for the Council to let the Departments know that we were very disappointed in this lack of communication.
In addition we learned, whereas the original delivery date was October 2015, unbeknownst to the Council a new date of April 2016 had become the target last November. But now we’ve been told that the April delivery date is no longer viable and the project is estimated to go-live in the fall of 2016.
Currently, the NCIS project has an estimated “burn rate” of $3 – $4 million spent per month. I am working on getting more specific information about how those costs are spread across departments, functions, and the contractor hired to help build the system.
Councilmember Sawant, the Chair of the committee with oversight of SCL and I – as the chair of the committee with SPU oversight – will be planning an upcoming joint committee meeting. We hope to bring the NCIS quality control consultant to committee in order to discuss what risks there are going forward and the steps needed in order to complete this project. It’s important to get the system right. An audit of a Los Angeles billing system found that errors from rushed implementation resulted in $245 million in uncollected revenue. But in getting it right we need to insure that we have appropriate Council oversight and accountability in place.
The good news is that the system implementation delays will have no impact on currently adopted utility rates charged to City Light and SPU customers. As more information becomes available I will do my best to keep you updated.
Neighborhood Street Fund deadline
The deadline for applying for the Neighborhood Street Fund is April 17. Anyone can apply for funding—residents, businesses, community groups and non-profits are all encouraged to apply.
$24 million was included in the 9-year Move Seattle levy passed by voters in 2015. $8 million is available in each three-year cycle.
The FAQ for applying has additional information. Applicants who do not have online access, or who need language assistance with submitting an application can contact SDOT for help at NSF@seattle.gov or by phone at 206-733-9361. The online application is here.
You can view examples of past projects from the 2013, 2010, and 2007 cycles that were funded by the previous Bridging the Gap transportation levy. Generally 10-15 projects are funded.
- In the 2010 cycle, $501,000 for sidewalks, and drainage on 25th Avenue SW between SW Brandon and Findlay Streets, and $112,000 for crossing improvements on California Avenue SW at SW Othello and Frontenac.
- In the 2007, $600,000 for sidewalks on Alki Avenue SW between 65th Avenue SW and Beach Drive SW, as shown in before/after photos above on the right.
Preservation: the Missing Piece of our Housing Strategy
On Wednesday, April 6, I proposed a new affordable housing preservation funding strategy to the Affordable Housing, Neighborhood, and Finance Committee. We were joined by leaders from Puget Sound Sage, Low Income Housing Institute, and Homestead Community Land Trust.
A truly comprehensive affordable housing strategy with a focus on racial and social justice must include strategies to preserve existing affordable housing. In this way we can help existing communities prosper in place and be resilient to the pressures of redevelopment on existing rental housing that is not subsidized, but is still affordable. If we commit to new efforts to preserve multifamily market rate affordable housing we can help more people earning between 50 percent and 80 percent of the area median income.
Every year the city loses some amount of market rate affordable housing due to increased rents of buildings that are under new ownership as well as buildings that are torn down and redeveloped for rentals with higher rents. Low income tenants can rarely afford the new significantly higher rents of this housing.
In September 2015, we passed the Notice to Sell Multifamily Housing Ordinance, which requires owners of affordable rental housing to provide a notice to the City and SHA prior to an owner formally, listing a property for sale. However, the ability of City or SHA to make an offer is limited by the lack of available funding. While the 2016 Housing Levy allocates resources that could be used to preserve this market rate affordable housing, the current housing levy programs are not oriented towards this need.
My proposal would fund the implementation of this ordinance and make it possible to purchase properties like the Panorama or the Lockhaven Apartments, where longterm tenants – many of them seniors were displaced when the property sold and the rents increased drastically.
This proposal embraces two HALA recommendations. HALA members recommended that we use our bonding authority for housing and re-establish the 1985-2002 Growth Fund. I propose that we do so and issue a small (under $10 million) housing bond to specifically maximize opportunities to save existing market rate affordable housing at risk of increased rents under new ownership or redevelopment. We regularly issue limited tax obligation bonds for a variety of capital improvement projects such as utility projects, parks and transportation projects, and even the Pike Place Market. We should also issue bonds to meet this unmet need in our affordable housing strategy. The Growth Fund would be used to help pay off the 20 year debt associated with this small housing bond. The Growth Fund would be filled with an increment of property taxes associated with new construction. So in this way it would not impact programs and city services that we currently fund with our property tax revenue, but it would instead only earmark future revenue growth for this purpose. Some have expressed concerns that we’d be earmarking future revenue without a discussion of the budget tradeoffs (what other new programs and services we might want to fund in the future). My response is that, because the City has decided that it serves an important purpose, we have another program, the Multi-Family Tax Exemption (MFTE) Program that diverts much more money, a couple million dollars each year, from the general fund, also without a discussion of what other city services could be funded with that tax exemption. We have renewed and expanded that program several times without a policy discussion about the budget tradeoffs.
I believe that the City’s plan for growth must include dedicated funding for a new preservation strategy to reduce displacement and minimize the loss of affordable housing. My office will continue its work with community partners to develop program policies, including a case study and to discuss with my colleagues on the Council the pros and cons of different dedicated revenue sources in addition to the Housing Bond and Growth Fund.