ADMINISTRATIVE REPORT

Date: June 28th, 2001
Author/Local: A Straka/7546

RTS No. 02185

CC File No. 1002

Council: July 24, 200

TO:	Vancouver City Council
FROM:	Chief License Inspector
SUBJECT:	Current Status of License Office and Additional Proposed Changes

RECOMMENDATION

THAT Council approve funding for enhancements to the "Licence+" software and computer system, required for a new version of License+ software, conversion to Oracle, the implementation of cycle billing and internet payment access, at a cost of $221,000 plus $11,000 ongoing maintenance costs; source of funds to be the Service Improvement Reserve to be repaid over a 2 year period beginning in 2001 from a previous increase in business licence fees.

GENERAL MANAGER COMMENTS

The General Manager of Community Services RECOMMENDS approval of the above recommendation.

COUNCIL'S MOTION

On June 13th, 1996, Council passed the following motion:

A. That funding for the implementation of the Licensing Review and Redesign Better City Government project be approved at a capital cost of $500,000 and annual operating cost of $99,000 with a loan from the Service Improvement Reserve, repayable to the satisfaction of the Director of Finance. Repayments will be generated from additional license revenue and savings from the Operating Budget.

B. That the General Manager of Community Services report back to Council regarding the outcome of implementation, and specifically the staffing levels and other changes that may be required, after implementation is completed.

PURPOSE AND SUMMARY

This report provides an update on the "Licence+" application management system and other changes implemented in the License Office in response to the findings of a licensing review undertaken in 1996. It is clearly demonstrated that the project has successfully met the objectives established as part of this review.

The report also discusses the next steps proposed for the License Office to further enhance operational efficiency and improve upon customer service. These steps include a review of the existing license fees and categories, the implementation of cycle billing and internet access and computer hardware and software upgrades. A review of the existing license fees and categories will be undertaken with the findings presented within a separate Council report.

Cycle billing involves license renewal process wherein the 75,000+ dog and business licenses issued annually by the City will expire and be renewed at different times throughout the year rather than expiring on December 31^st. The first phase of cycle billing will be implemented for dog licenses only, while the second phase will involve the inclusion of some business licenses into a cycle billing system, based upon category in 2003.

The phased implementation of internet access will allow customers the convenience of purchasing licenses directly from home. A pilot project for Internet access for dog license renewals was implemented in the fall of last year. Expansion to business license renewals and new applications is to be started late this year with the goal of the majority of license renewals being payable via the internet in 2002.

Proposed hardware and software upgrades, including a new server a new version of license+ software, conversion to Oracle and additional printers, will assist with the smooth implementation of the cycle billing process as well as internet access.

The implementation of cycle billing and internet access in the License Office will significantly improve existing service to the public. The cycle billing system will distribute existing workloads more evenly throughout the year, thereby increasing staff morale, reducing the stress level of frontline office staff and increasing enforcement efficiency. Customer convenience will be enhanced through the ability to purchase licenses directly through the internet and by reducing payments in and around the Christmas season; traditionally one of the busiest and most financially taxing times of the year.

BACKGROUND

In May 1995, Council approved a work program for Better City Government. The program consisted of fifteen (15) significant work process review and redesign studies which, uponimplementation, were expected to bring significant improvements in service and effectiveness. "License and Regulate Business" was identified as one of the processes for the study. This process was subsequently divided into two sub-processes: licensing and regulation of business and property use. In May 1996, the licensing review component was completed. This review proposed the purchase of a new licensing software system and certain office changes designed to increase operational efficiency, improve customer service and bring existing technology and systems up-to-date.

On May 29, 1996, a report summarizing the findings of the License Office review and justifying the need for a new licensing application management system was presented to the Standing Committee on City Service and Budgets. Subsequently, on June 13th, 1996, Council passed a motion approving funding for the implementation of the proposed Licensing Review and Redesign Better City Government project, as well as the creation of a full-time quality/training coordinator position in the License Office. The coordinator, hired in November, 1996, is responsible for staff training, supervision of temporary staff, handling policy/procedures/training for "Licence+" and providing back up to the System Administrator.
Funding for the project was approved upon repayments for the loan from the Service Improvement Reserve being generated from additional license revenue and savings from the Operating Budget. As shown in Schedule A, the capital and operating costs of the new licensing system were $500,000 and $99,000, respectively. A cash flow analysis undertaken in May, 1996 indicated that implementation of the "Licence+" system would generate a positive annual cash flow within five years and a payback period (including 7% interest) of 4 years. Total expenses for the implementation of "Licence+" and associated office changes will be fully repaid by July 2001.

The 1996 license office review established specific objectives in response to Council's goal of achieving "Better City Government". The "Licence+" application management system and office changes, designed to meet these objectives, were implemented in mid-1997 through 1998. An evaluation of the License Office's current status, using the original objectives as a measure of success, is presented below. This evaluation demonstrates that the project has successfully met all the established objectives. Schedule B provides a summary of the previous manual licensing system.

CURRENT STATUS OF LICENSE OFFICE

Objectives established in 1996 License Office Review:

1. Increase operational efficiency by decreasing application processing times.

Since the implementation of "Licence+" and modifications to the office in mid-1997, transactions are completed directly at staff's work stations where most licenses areissued immediately upon payment. The average application processing turnaround time ranges from immediate to two (2) weeks. The time period required to address the annual backlog in mailed license renewals has decreased by two months since 1997. Schedule C provides a comparison of the average application processing turnaround times under the previous manual licensing system versus "Licence+".

2. Streamline/simplify licensing application process.

The License Office offers a single point of contact for application and payment. The customer approaches the receptionist and identifies the service required. The customer is then called by a License Representative who processes the license application. The customer's name and address are entered into the system and zoning and building use is confirmed via access to on-line software applications. The license rate is automatically displayed on the screen based on coding and a bill is generated and paid directly at the work station. All approved licenses are then issued and printed for the customer. The entire process takes approximately 10 - 15 minutes. Licenses requiring approvals from other departments are generally processed within one to two weeks, depending upon timing of approvals.

3. Improve City-wide access to information for staff and customers resulting in better overall communication.

All License Office staff have access to numerous on-line software programs, for example, Prism, Domino, Microsoft Mail, the internet, etc., through their PC's. Zoning, building and licensing information are coordinated on-line through the various applications, including "License+, enabling staff to complete most clearances/holds for customers immediately at their work station.

"Licence+" on-line account data, accessible by all authorized City staff, provides client folders with individual account history, records of various departmental approvals, and copies of bills, payments and relevant penalties. Easily accessible information on customers' history provides new and replacement staff with vital information previously acquired only through a manual, time-consuming search.

4. Increase staff skills and provide basis for job satisfaction.

Duplication of effort in the License Office has been reduced, enabling staff to complete most applications from start to finish. Greater control over the license process has increased job satisfaction and improved staff morale. Staff are fully trained on "Licence+" and have attended courses on the Zoning & Development By-law and received minimal training on building classifications in the Vancouver Building By-law. Staff's job classifications have also been reviewed and updated,incorporating the skills required for Windows, "Licence+" and cash handling.

5. Provide staff with easy-to-use tools to complete the licensing process and to provide management information without technical support from Information Services.

"Licence+" is user-friendly and enables staff to create new files, update and amend existing files and issue and print licenses immediately. The system provides internal controls for all key processes and adequate audit trails for all transactions. Management information such as key activity volumes, license status tracking, customer history information and backlogs can be easily tracked, monitored, enabling more effective problem resolution. Under "Licence+", paper copies of applications and licenses are no longer retained.

"Licence+" offers the following easy-to-use attributes: address history/quick access to current status; increased functionality - searches by name, phone number; standard form for all licenses; immediate updates for account changes; automatic compiling of financial data; unlimited data folders; reduced paper files; and support information requests from third parties.

6. Improve office functionality.

The office has an open layout with a comfortable waiting area for the public. Staff work directly with customers at ergonomic computer work stations where most transactions are completed. The telephone answering system stacks up to ten (10) calls and provides clear voice prompts allowing customers to leave messages.

The system enables local fax and communications internally within the department and externally to other City departments and agencies. The City-wide internet system serves as a link to external agencies, such as the provincial trade qualifications database, enabling quicker clearances.

NEXT STEPS: ADDITIONAL CHANGES FOR THE LICENSE OFFICE

1. LICENSE FEE AND CATEGORY REVIEW

Schedule "A" of License By-law No. 4450 presents a list of the various license categories and associated fees issued by the City of Vancouver. A review of these fees and categories is required to simplify existing classifications, eliminate unnecessary out-dated categories and derive fees based upon background work required prior to license issuance. This step is necessary prior to the implementation of cycle billing as classes of business licenses will then be renewed throughout the year based upon specific categories. This work will be completed with existing resources.

2. IMPLEMENTATION OF CYCLE BILLING

Amendment to Vancouver Charter

In October 1999, the Provincial Legislature introduced a number of Bills containing important amendments to the Vancouver Charter. Bill 74, Miscellaneous Statutes Amendment Act (No. 2), 1999, contained a Charter amendment which had long been requested by Council and which significantly improves the City's ability to issue and process licenses.

Section 273 of the Charter required that licenses expire on December 31 of the year in which they are issued, and gave no flexibility to prorate fees for licenses issued part way through a year. Section 63 of Bill 74 repealed Section 273 and replaced it with a provision which provides much needed flexibility. Council is authorized to set the term for a license for any period up to two years from the date of issuance of the license, and to prorate the fee for a license in relation to the term of the license. The License By-law may also provide for different terms for different classes of licenses and Council may delegate the authority to set the terms of licenses to an officer or employee of the City under conditions established in the by-law.

Definition and Phasing of Cycle Billing

Cycle billing will be implemented as a twelve (12) month license renewal process wherein the 75,000+ dog and business licenses issued annually by the City will expire and be renewed by category at various times throughout the year rather than at the end period of December 31^st. Much of the current workload during the first 3 (three) months of the year is a direct result of the existing calendar renewal system. Cycle billing will help to eliminate the heavy volumes in the first three months of the year by spreading the existing workload out more evenly throughout the year. The first phase of cycle billing will be for dog licenses only, while the second phase will involve the inclusion of all business licenses into a cycle billing system, based upon category, during 2002 end 2003.

3. INTERNET ACCESS

Payment of business and dog license fees via the internet is being planned as a means of improving customer service in the License Office. Internet access for dog license renewals was implemented in September 2000, further to the purchase of "Netconnect" software. The phased implementation of internet access will allow customers the convenience of purchasing licenses directly from home. Expansion to business license renewals will commence in late 2001 with the goal of most licenses being payable via the internet by late 2002.

4. SYSTEM UPGRADES

The existing license system has now been in place for four (4) years. Upgrades to the hardware and software are now required in order to facilitate cycle billing and internet payment. A server upgrade and conversion to Oracle give staff the capability of running large reports, renewal notices and inspector lists during business hours. Currently, this work must be done after hours due to the volume of transactions and the number of users on the system.

Staff are also exploring the option of using the License+ system for some of the address-based Engineering permits which will facilitate the exchange of information between the two departments.

5. REQUIRED FUNDING

To proceed with the next steps proposed for the License Office, staff recommend that Council approve funding for modifications to the "Licence+" system required for the implementation of cycle billing, purchase of internet payment access, hardware upgrades and associated expenses at a cost of $221,000 plus $11,000 ongoing maintenance costs. Schedule F provides a full breakdown of these costs.

Source of funding will be the Service Improvement Reserve to be repaid over a 2 year period beginning in 2001 from an existing repayment fund in the License Office.

CONCLUSION

The "Licence+" application management system and other changes implemented in the License Office in response to the findings of the 1996 licensing review have substantially improved operational efficiency. The average application processing turnaround time now ranges from immediate to two (2) weeks and the entire process has been streamlined reducing customers' time in the office to 10 - 15 minutes. Improvements in the functionality of the office include a new telephone system, on-line access to all computer software packages, credit and debit card payments, a comfortable waiting area for the public, hiring of a quality control/trainer position and an open and efficient office layout for staff and the public.

The implementation of "Licence+" and office modifications have made it possible to deal with the increase of number of licenses issued and the increase of the level of customer service with existing staff. Finally, financing of the "Licence+" system and associated office changes is ahead of schedule with total expenses projected to be fully repaid by July 2001.

The next steps proposed in the License Office to enhance operational efficiency and improve customer service include a license fee and category review, the phased implementation of cycle billing and internet access, required computer hardware upgrades and the purchase of additional software licenses for "Licence +" for the Property Use Inspectors.

To enable a timely facilitation of the next steps, staff recommends that Council approve funding for modifications to the "Licence+" system permitting cycle billing, associated hardware upgrades and a program for internet payment access as outlined in this report.

- - - - -

SCHEDULE A

Costs Associated with Implementation of "Licence+" (Mid 1997 - 1998)

Required Changes	Capital Costs	Ongoing Operating Costs
Project Management	$80,000
Quality/Training Coordinator		$38,000
Computer System * Hardware * Software & Training * Maintenance & * System Support	$153,000 $137,000	$36,000 $25,000
Telephone System	$10,000
Furniture & Equipment	$100,000
Contingency	$20,000
TOTAL	$500,000	$99,000

SCHEDULE B

SUMMARY OF PREVIOUS MANUAL LICENSING SYSTEM

1. Operational requirements.

· A 20+ year old main-frame based batch system supported by Information Services. All new licenses and renewals were printed by Information Services and mailed out by License staff when time was available.
· The manual tasks involved in the licensing system required more staff time per application.
· Turnaround times for processing applications were dependent on the response times of other departments as all clearances and holds had to be checked manually with external departments.

2. License application process.

· The application process commenced at the License Office where, with the exception of most license renewals, customers were first directed to other municipal counters (eg. Building, Zoning) to obtain required clearances/holds. Customers would then return to the License Office where their application would be reviewed and processed manually, before they could proceed to the cashier for payment.
· The License Office had limited control over the application process as the system was supported externally by Information Services. The inability to issue and print licenses immediately complicated and delayed the process.

3. Lack of City-wide access to information and poor communication.

· As each City Department possessed information and records pertaining only to their own tasks/responsibilities, customers were required to visit a number of municipal counters (ie. Zoning, Building) to obtain required clearances/holds prior to initiating an application.
· Electronic on-line data linkages with other City departments and external stakeholders did not exist. Staff spent a considerable amount of time on the telephone or away from the office to acquire information from the Province and/or other City Departments necessary to complete a license application.

4. Limited staff skills and limited job satisfaction.

· The manual nature of the tasks was tedious and time-consuming.
· Much of the application process was outside the control of the License Department, and therefore, staff did not have the satisfaction of completing a task from beginning to end.
· Timing of required responses back from other City departments varied significantly and often delayed critical decisions. Such delays increased application processing times, contributing to a larger backlog in license mail renewals.
· Considerable duplication of effort existed in the License Office as there was no means of tracking the numerous tasks and responsibilities.
· Keeping track of individual workloads was difficult under the manual system, resulting in a work imbalance amongst staff.
· In the absence of a comprehensive tracking system, the compilation of statistics and management information was difficult and time-consuming, and therefore, often a low priority for the department. Lack of up-to-date statistical and management information lead to difficulties in planning appropriate internal resource levels.

5. Poor office functionality and outdated tools.

· Customers were required to walk down a long hallway to get to the licensing counter, and then asked to wait in line. There was no waiting area available.

· Existing work stations were outdated and staff were often required to share desk space. Counter staff were also required to stand all day.
· The existing telephone system was outdated. With only three incoming lines, customers were often put on hold for long periods of time.
· City-wide electronic linkages with other City departments and external stakeholders did not exist, requiring staff to spend a considerable amount of time on the phone or away from the office acquiring essential information.
· Due to the heavy workload and volumes, Property Use Inspectors were sometimes required to provide back-up in the department, reducing their time to conduct enforcement.

6. Missed sources of revenue.

· Potential revenue sources were often missed as the system was incapable of cross-referencing and tracking application history and payment. Examples of missed potential revenue sources included the following: Business licenses not issued; vending decals not issued; municipal decals; commercial plates; seminars, conventions, etc.; selling information to third parties; collecting penalties for late payment; charging government agencies for services, NSF cheques written off; transferring business licenses at a certain fee; and charging for account changes.
· The manual nature of the licensing process and staff time spent on obtaining information from internal and external departments was time-consuming and increased labour costs. Considerable staff time was also required to compile management information, as well as dealing with customers on the telephone who were unable to leave a message.
· As customers were provided with only two payment options, cash and cheque, little incentive existed for prompt and direct payment.
· Mailing out all licenses to the customer resulted in higher postage and envelope/form expenses.

SCHEDULE C

Comparison of Application Processing Turnaround Times

Process	Previous Manual Licensing System	"Licence+" Application Management System	Previous Manual Licensing System	"Licence+" Application Management System
	NON-PEAK TIMES (May -December)		PEAK TIMES (January -April)
New Application -counter	3 - 5.5 weeks	Immediate - 2 weeks	6 - 12 weeks	Immediate - 2 weeks
New Application -mail	3 - 5.5 weeks	Immediate - 2 weeks	6 - 12 weeks	4 - 8 weeks
New Application -via Property Use Inspector	7.5 - 9.5 weeks	1 - 2 weeks	8 - 14 weeks	4 - 8 weeks
Transfers -counter	2 - 4 weeks	Immediate - 2 weeks	7 - 9 weeks	Immediate - 2 weeks
Straight Renewals -counter	2 days - 2 weeks	Immediate	4 - 6 weeks	Immediate
Straight Renewals -mail	4 - 12 weeks	Immediate - 1 week	6 - 12 weeks	2 - 3 weeks
Renewals with changes -counter	2 days - 2 weeks	Immediate - 2 weeks	7 - 9 weeks	4 - 8 weeks
Renewals with Changes - mail	4 - 12 weeks	Immediate - 1 week	8 - 16 weeks	4 - 8 weeks

SCHEDULE D
REVENUE COLLECTED BY LICENSE OFFICE (1993 - 1999)

Add stats for 2000

Year	1994	1995	1996	1997	1998	1999	2000
Revenue Collected	$8,447,042	$8,972,672	$9,199,080	$9,487,068	$9,964,052	$10,172,285	$10,151,917

SCHEDULE E

Summary of Customers' Comments on License Office Efficiency
(Survey conducted in 1999)

· Staff was great! Very prompt and helpful.
· I really enjoy receiving my license right away!! This is great.
· Fast service!
· I have never had such "Excellent Service" from the City of Vancouver.
· Good staff. You should stay open until 5:30 pm and start at 8:00 am.
· Excellent prompt and knowledgeable service.
· Lack of signage.
· Unexpectedly everything is excellent. Staff are kind. Accurate information and prompt services were done. Office layout is very nice.
· Very helpful.
· The service is excellent. I got my license within 10 minutes. That is really wonderful.
· Office needs more lighting.
· Impressed with efficiency.
· An expected delight from government office staff.
· Good service and easy to follow directions.
· Office layout is very confusing - reception should be at the other end of the office. There are way too many desks. Big signs above the stations would be a good idea.
· So far, everything has gone much faster and smoother than anticipated.
· Very good efforts. Please keep up the good work.
· Huge improvement. Very responsible and willing to help.
· Very friendly, quick service.
· Good service. Courteous.
· Waiting area is too much of a cattle pen or holding pen area.
· Faster service and same day pick-up for license is a plus. Good computer data too.
· Reception is at the wrong end of the building.

SCHEDULE F

Cost of Cycle Billing Implementation and Proposed Operational Changes

needs updating based on conversation with Synertech

Additional Proposed Changes	Capital Costs	Ongoing Operating Costs
Computer System: * Hardware Upgrades: - Server (Oracle) - Computer Hardware * "License+" Software changes * "Netconnect" software purchase * "Netconnect" Maintenance	$15,000 $11,000 $121,000 $12,000	$6,500 $2,000
Block of Licenses (8)	$17,000	$2,500
Advertising Costs	$10,000
Contingency	$20,000
Consultant for Fee Review	$15,000
TOTAL	$221,000	$11,000

* * * * *

(c) 1998 City of Vancouver