City Utility Billing Service Switch Warrants Further Explanation

Minol BillingTorrance appears ready to dump its current utility billing services provider, Global Water, in favor of international company Minol. According to the staff report, the decision was prompted by concerns that Global is about to exercise their right under the contract to terminate for convenience.

Global was originally hired by the City in September of 2010.  They won the contract after being evaluated the highest of three bidders.  This past January the City exercised its option to extend the contract noting that the City was “satisfied with the level of service.”

Global WaterThe current staff report, however, reveals that the City received numerous complaints from Global over the years about the dollar amount of their contract.  Those complaints, according to the City, recently escalated to the point that Global’s management made overtures that they will terminate the contract for convenience. The staff report indicates that Global’s concerns stem from their claim that they originally miscalculated the cost when submitting their proposal and that they cannot continue to provide the services at the current dollar amount.

Despite the purported threats, Global has yet to exercise its right to terminate the contract.  To do so, Global would have to provide the City with at least 365 days notice per the terms of the contract.

The staff report also notes that last January City staff flew to Addison, Texas to tour the Minol facility.  Upon returning, staff agreed that Minol had a professional operation and would be an excellent partner with the City in providing utility billing.  Negotiations ensued and a tentative agreement was recently reached with Minol.

That agreement calls for the City to pay Minol $600K per year plus $200K one-time implementation costs.  The current contract with Global is for $100K less at $497,756 per year.  Despite that cost discrepancy, the staff report indicates that switching to Minol will be “relatively cost neutral in year one.”

Curiously, the City did not seek a competitive bid for this service despite having done so previously when the contract was awarded to Global.  The staff report provides no explanation why the competitive bidding process was not followed.

The agreement is pending formal Council approval Tuesday night.  If approved, it is expected that Minol will begin service May 01, 2016.

3 comments

  • anonymous

    Who cares the tax payers of Torrance pay for it. Why shop around?

  • Arthur J Plourde

    Hello Torrance Residents:
    It is time for MASS demonstrations at City Hall since when can the city deal with single bidders? Can someone explain why a minimum of 3 bids is not a requirement to have a fair appraisal of a potential contractor to the City of Torrance. Has any one weighed the cost of going outside of the city in relation to having city personnel perform the billing and collection of this utility? Why cannot Torrance do it’s own work? Why do we always have to put or place work that could be done by our own city outside of our own neighborhoods. What are the regulations with respect to awarding contracts and expenditures of large sums of city money to outside agencies. Is there even a Policy written or Procedure to be followed? Since when did Torrance become so incapable of doing things for itself without adding costs that are surely reflected in the bills of home owners and renters and building owners and managers and all who live in Torrance suffer at the will of the City Council, a pack of persons from our community who do nothing to try and trim the expenses no on the other hand all they do is grow the expenses to the citizens of Torrance. Enough is Enough!! The people of Torrance should demand an full and completed audit of staff’s recommendations here and also the costs of seeking this bid from an agency so far removed from Torrance. Have these people no vision, no gumption, no backbone to stop lining other peoples pockets with Torrance Tax Payers money? Something is very wrong here and this should be thoroughly and completely investigated and justified to the public. Do Not Allow this City to rubber stamp this like they do everything else they approve. Leadership is needed now more than ever, and it doesn’t include a bobble head saying “YES” to every recommendation that staff from the City Managers office recommends. These folks need to bring proof forward showing the need for this expenditure. I am not convinced that Torrance has exhausted all avenues of consideration. Thank you what is your opinion!

  • anonymous

    Right on Mr Plourde, however very few people are willing to speak up. And the current council does not seem to care about what people have to say. Let’s make sure we don’t elect more rubber stampers or Yes council members in the next election.

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