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SUCCESS IN THE TRENCHES :

SUCCESS IN THE TRENCHES :. Smart Management Practices in the Field Derek S. Leffert Missouri One Call System Mike Gowen Arkansas One Call. OVERVIEW. Cost Overview/Situational Awareness Service/Installation Contractors - Problematic Ticket Submissions Contract Locators

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SUCCESS IN THE TRENCHES :

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  1. SUCCESS IN THE TRENCHES: Smart Management Practices in the Field Derek S. LeffertMissouri One Call System Mike Gowen Arkansas One Call

  2. OVERVIEW • Cost Overview/Situational Awareness • Service/Installation Contractors - Problematic Ticket Submissions • Contract Locators - Issues With Ticket Management • Your Response & Responsibilities - Recommendations/Suggestions - Available Tools

  3. HISTORICAL STATISTICS

  4. AGGREGATE COST IMPACT Average Cost Per Locate (Missouri) = $22.75 (Inclusive of Labor, Overhead, Ticket Cost, etc.)

  5. COSTS VS. REVENUE • Budgets have decreased precipitously in the past 5 years • Cost-containment measures are increasingly important • Unnecessary outlays undermine already small margins and decrease shareholder equity • With a commitment of time, cost-savings relative to the One Call process is attainable

  6. SERVICE & INSTALLATIONCONTRACTORS: A Review of Problematic Issues

  7. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #1 – RENEWAL TICKETS • Renewals are NOT required every 10 days, ONLY when markings are no longer usable • Approximately 55% - 60% of Renewals are illegitimate • Approximately $5.3 Million annually is spent on illegitimate renewal tickets • MTIA Member Example: Contractors for 1 Member totaled 9,954 Renewals in 2010 9,954 X 55% = 5,474 Illegitimate X $22.75 (ACPL) = $124,550 in UNNECESSARY Costs from 1 Company’s Contractors

  8. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #1 – RENEWAL TICKETS (Continued) • Ticket #102570166 – 6 Tickets on the Project Renewed 62 times in a 1 year period • 62 X $22.75 (ACPL) = $1,410.50 • 8 Utilities Per Ticket X $1,410.50 = $11,284 • $11,284 X 6 Tickets Per Submission = $67,704 on 1 Project that was 1 ½ miles long

  9. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #2 – NON-COMPLIANCE TICKETS • Non-Compliance requests are in violation of Missouri law • Failure to provide adequate notice forces utilities to shift resources and increases costs significantly • More than 100,000 Non-Compliance Requests were made in 2010 • MTIA Member Example: 1 MTIA Member’s Contractors accounted for 898 illegal tickets in 2010

  10. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #3 – FALSE EMERGENCY REQUESTS • Submitting emergency requests under false pretenses is a direct violation of Missouri law • Emergencies require a 2 hour response by utilities • False emergencies unnecessarily cause a shift of resources and drive up total costs • Approximately 40% of emergency requests are not true emergencies as defined by law • MTIA Member Example: 1 MTIA Member’s Contractors submitted 3,395 Emergency requests in 2010 (approximately 1,358 were likely inconsistent with Missouri law)

  11. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #4 – FALSE NO-RESPONSE REQUESTS • Approximately 72% of the No-Response Requests received by MOCS are false • False no-response requests create two issues: #1 – Utilities pay for the second request #2 – Utilities are forced to make a second trip to the site to verify markings thereby increasing costs unnecessarily • Potential impact to ALL Missouri utilities in 2010 = $769,417

  12. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #5 – DIG UP TICKETS • Failure to report the damage or disturbance of a underground utility line is a violation of state AND federal law • Significant problems can result from an unreported damage • Particularly problematic with explosive increase in directional drilling

  13. INSTALLATION/SERVICE DROP CONTRACTORS PROBLEM #6 – DEPTH OF LINE INSTALLATIONS • Shallow depth of buried utilities is the #1 complaint from professional excavators and utility excavators alike • Shallow installation poses greater risk to system reliability and consumer satisfaction and invites increased scrutiny from regulators • MODOT has vocally expressed significant interest in addressing shallow installations through legislative and permitting/inspection initiatives and/or costly utility relocations

  14. CONTRACT LOCATORS:Identified Issues and The Relative Costs

  15. LOCATE CONTRACTORS PROBLEM #1 – LACK OF UTILITY RESPONSE • In 2010, utilities failed to respond to requests approximately 28,000 times • Failure to respond is a violation of Missouri law and is being closely examined by regulators • Failing to mark facilities can lead to catastrophic service interruptions and consequently – legal liability • Failure to respond is costly for excavators who have machines on site • Failure to meet statutory obligation negatively impacts the system as a whole and the utility’s public perception

  16. LOCATE CONTRACTORS PROBLEM #2 – DIG UPS/DAMAGES • Recent responses to Dig Up tickets submitted is fraudulent in nature and must be prohibited • Unaltered, documented responses with photographs are critical to supporting damage claims • Adequate damage investigations by the Utility are essential • Timely, accurate invoicing for claims increases likelihood of payment and enhances relationships with contractors

  17. LOCATE CONTRACTORS PROBLEM #3 – RENEWALS • Most locating contractors are paid per ticket • Renewals require far less time and labor • Recent concerns have been expressed regarding locate contractors who “encourage” renewals unnecessarily • Unnecessary renewals account for approximately $5.3 million annually • There are some documented circumstances where renewals are ignored but still billed to the utility

  18. LOCATE CONTRACTORS PROBLEM #4 – INCONSISTENCY IN BILLING • Recent inquiries by utilities have revealed disparities in invoices between what MOCS sent and what was ultimately billed by contractors • Daily, monthly, and yearly reports are available to verify the number of tickets transmitted to locate contractors • Close scrutiny is essential to controlling costs and monitoring performance

  19. YOURROLE & RESPONSIBILITIES

  20. YOUR ROLE IN THE SYSTEM • Control Costs • Ensure Contract Deliverables Are Met • Ensure Compliance with Statutes • Develop Performance Standards • Audit/QA Contractors • Require Employee & Contractor Awareness & Education • Provide Feedback & Participate in the One Call System

  21. COST CONTROLS • Minimize unnecessary tickets submitted by contractors & employees ($22.75+ per ticket) • Ensure that proper planning/design/engineering gives contractors adequate preparation time • Reduce liabilities by requiring compliance with statutes • Minimize at-fault damages and subsequent liability through proper excavation techniques • Ensure timely cost-recovery on damages with thorough damage investigations

  22. CONTRACT DELIVERABLES • Establish practical, reasonable, and safe measures in contracts to enhance quality, reliability, and consumer satisfaction • Consistently review and enforce defined criteria • Conduct periodic discussions with contractors regarding deliverable attainment • Enforce penalties for unmet provisions

  23. PERFORMANCE STANDARDS AND AUDITING CONTRACTORS • Statutory Compliance • Employee Education (Online Modules, MOCS Training) • Periodic Review of Submitted Tickets • Inspections on Permitted Projects (Particularly on MODOT R-O-W) • Pre & Post Excavation Photos & Documentation • Damage Ratio (Damages vs. Amount Installed)

  24. PERFORMANCE STANDARDS AND AUDITING (Continued) LOCATORS • On Time Locates • Accuracy of locates (Damages Due to Mismarks) • Damage Ratio (At-Fault Damages vs. Total Ticket Volume) • Ticket Transmission Confirmations • Independent Damage Investigations (Third Party or Utility Employee rather than Locate Contractor)

  25. FEEDBACK & PARTICIPATION • MOCS is Member-Owned & Governed • MOCS is Non-Profit • Telecommunication Industry is heavily represented • Quarterly Operating Committee Meetings • Quarterly Board of Directors Meetings • Coalitions for Legislative Support • Suggest Changes for Greater Efficiencies/Cost Savings • Attend MOCS Seminars, Meetings, and Events

  26. TOOLS/RESOURCES AVAILABLE • MOCS Board of Directors & Operating Committee • MOCS Management Team • MOCS Website & Newsletters • Online Training Module • Online Ticket Database for Research/Auditing • On-site seminars/education • Public relations and awareness • Educational Materials

  27. REPORTS

  28. Main Member Reports Page

  29. Click on Caller Header Report

  30. Specify Date Range Specify County Specify Type of Caller

  31. This provides a breakdown by caller and the type of tickets that they called in

  32. Specify District Code Specify Date Range Specify County Specify Email Address if you wish to export the data to a spreadsheet

  33. This report will provide the number of total tickets requested by the caller in the specified date range

  34. Click on Ticket Reports

  35. Click on Relocate Report

  36. Specify Date Range Specify number of Renewals

  37. This report will show how many times a specific ticket has been renewed and who called it in

  38. Click on Ticket Search

  39. Specify District Code Specify parameter to search by Specify County Specify Date Range

  40. This report will return all tickets that match the defined parameters and allow you to look at each ticket individually

  41. Click on Ticket Transmission Report

  42. Specify Date Range Specify District Code Specify Email Address if you want to export to a spreadsheet

  43. This report shows all tickets received in the specified date range

  44. QUESTIONS? Derek S. Leffert 573.280.8500 Cell 573.635.1818 Office derekl@mo1call.com

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