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Pet License Sales OutsourcingTO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Outsourcing Pet License Sales DATE: June 3, 2008 The Health Services Department has investigated outsourcing pet license sales due to the inefficiencies in the system currently used and in an effort to enhance services to the citizens of Dubuque. The City's pet licensing database is housed through the Information Services Department's Pentamation system, primarily administered by the City Clerk's Office and also utilized and updated by the Health Services Department. Since Pentamation is primarily a finance software system, it needed to be modified to track and issue pet licenses. There are many steps in the process that can lead to mistakes and unhappy citizens. The Health Services Department also enters all animal rabies certificates into the database, which is supplied by local veterinarians as required by the City Ordinance. A system like PetData's would enable the City to sell pet licenses year round, instead of only the three-month time periods of January -March (for dogs) and July -September (for cats). This would ease the burden of processing thousands of licenses and enforcing on delinquents, since we would not be doing them all at once. Selling licenses year round, with renewals on the date of purchase, would also not penalize citizens buying licenses for their dogs in, for example, November or December when they have to turn around and buy a new one sometime between January -March. Licenses would also be able to be purchased via credit and/or debit card with PetData. There would be an immediate direct cost savings of $12,882 in that the City would not need to hire a person for the newly created 20 hour per week part-time secretary position in the City Clerk's Office. The Health Services Department would also have a direct cost savings of $5,694 for the printing and mailing of renewal notices. The license revenues above direct expense of $26,322, along with these savings, would more than cover the $33,700 in first year costs. Dubuque staff has researched to find other companies besides PetData to provide this comprehensive pet licensing service, but have not found any. PetData is a firm whose only function is to provide full-service pet licensing to communities. Therefore, Public Health Specialist Mary Rose Corrigan is recommending approval of staff negotiating and executing a sole source contract with PetData for pet license sales. I concur with the recommendation and respectfully request Mayor and City Council approval. ~~-,~ ~!-~ ~l z ~ Mic ael C. Van Milligen MCVM/jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Mary Rose Corrigan, RN, Public Health Specialist THE CITY OF Dubuque DUB E ""~ 1 1 Masterpiece on the Mississippi 2007 TO: Michae~l~ C~~~Van Milligen, City Manager FROM: Mar~~2l~~:.Eorrigan, RN, Public Health Specialist SUBJECT: Outsourcing Pet License Sales DATE: June 3, 2008 INTRODUCTION This memorandum provides information on the City's current pet licensing system, a company that provides these services, and a recommendation for outsourcing pet license sales. BACKGROUND The Health Services Department has investigated outsourcing pet license sales due to the incredibly time consuming, cumbersome, and often inefficient system currently used ( see Exhibit 1). The City's pet licensing database is housed through the Information Services Department's Pentamation system, primarily administered by the City Clerk's Office and also utilized and updated by the Health Services Department. Since Pentamation is primarily a finance software system, it was tailored to track and issue pet licenses. As demonstrated by the attached license sales process, there are many steps which can also lead to mistakes and unhappy citizens (see Exhibit 2). The Health Services Department also enters all animal rabies certificates into the database, which are supplied by local veterinarians as required by the City Ordinance. DISCUSSION Staff from the Health Services Department has researched various software packages for pet licensing, and also had discussions with PetData, a firm whose only function is to provide full-service pet licensing to communities. (See Exhibit 3). A system like PetData's would enable the City to sell pet licenses year round, instead of only the three-month time periods of January -March (for dogs) and July -September (for cats). This would ease the burden of processing thousands of licenses and enforcing on delinquents, since we wouldn't be doing them all at once. Selling licenses year round, with renewals on the date of purchase, would also not penalize citizens buying licenses for their dogs in, for example, November or December when they have to turn around and buy a new one sometime between January -March. Licenses would also be able to be purchased via credit and/or debit card with PetData. Partly due to the amount of workload required for inputting pet license data, City Clerk Jeanne Schneider is adding apart-time secretary beginning January 1, 2008. This position would potentially not be necessary if the pet, licensing is outsourced. It would also allow City Clerk's staff to concentrate on other duties in a more timely fashion and not be overwhelmed with an influx of license sales for six months of the year. In addition to staff time savings in the Clerk's office, Health Services and Information Services Departments staff would also spend less time on maintaining the current licensing system and handling citizen licensing complaints. The City would still be able to sell pet licenses on a limited basis for special circumstances. The Health Services Department would continue enforcement through civil citations with the Legal Department. However, we believe the number of citations would drastically be reduced due to the efficiencies of a new system. The enforcement would also be spread throughout the year, thus not inundating the Legal Department two times a year for pet licensing enforcement. Dubuque County is in the process of adopting an animal ordinance and have indicated they would like to partner with us in using PetData. PetData can separate City and County revenue and expenses for licensing by using GIS. The benefit of partnering with the County would be that all of the county rabies vaccination information from veterinarians would be available to capture more licensing. BUDGET IMPACT Health Services De artment current license-related costs Amount Printin of renewal notices, ostcards, window envelo es, etc. $2334 Posta a for mai~in renewal notices and to s a x. 8,000 .42) $3360 Health Services Secretary (rabies inputting and deletions/changes) -20* hrs per mo (13% of salary) & fringe - $519 X 12 mo $6228 Animal Control Officers - 10* hrs er mo 8% of sala - $209 X 12 mo $2512 Citation osta a estimate 500 citations $2.87 ea., less 25% $1076 TOTAL Health Services $15,510 Cost of Animal Control Activity FY'08 - $ 94,900 (does not include Humane Society Purchase of Service Agreement which is $109,400) City Clerk's Office license-related costs -The budgeted amount of $12,882 fora 20 hour/week part-time secretary. This position will not be filled at this time and the need for the position will be re-evaluated after the PetData contract has been in place for at least one pet licensing cycle. Not included in this amount, is the time spent on licensing by other staff members in the City Clerk's Office. There are days when all three employees spend the majority of the day processing pet licenses. Frequent customer walk-ins and phone inquiries regarding pet licenses are unnecessarily time consuming due to the current system being cumbersome and inefficient. OUTSOURCING COSTS AMOUNT Setu one time fee $ 975 License fees - $3.75/license @ 8500 license renewals (est. ) $32,725 REVENUE FY'07 PET LICENSES AMOUNT Dos $ 83,499 Cats $ 37,723 Total Revenue $ 121,222 Total Bud eted Cost of FY'08 Animal Control Activit $ 94,900 Net Revenue less Activit Ex enditures $ 26,322 Staff has researched to find other companies besides PetData who provide this comprehensive pet licensing service, but have not found any. Therefore, we would like to begin the process for executing a contract with PetData. Several areas will need consideration prior to contracting with PetData: 1. Animal Ordinance changes for licensing would require modification. At the same time, other animal ordinance changes and needed updates would be drafted. 2. Coordination with the Finance and Information Services Departments. Both departments have been informed of this outsourcing option and have indicated they could accommodate the transition and ongoing service. 3. Setup method for the City Clerk and/or Animal Control to sell pet licenses on a limited basis for special circumstances. 4. Public education to explain the new licensing process to citizens, veterinarians, etc.. RECOMMENDATION I recommend moving forward with the necessary steps to execute a contract with PetData, who would provide the pet licensing service for the City. A contract will be presented for Council consideration at a later date. CITY COUNCIL ACTION Recommend staff begin the process for outsourcing pet licensing for the City of Dubuque. M RC/cj Cc: Jeanne Schneider, City Clerk EXHIBIT 1 HEALTH SERVICES DEPARTMENT REVISED ANIMAL LICENSE ENFORCEMENT PROCEDURE 1. Dog licenses are sold annually (January -March). Notices are sent in December. They become delinquent on April 1. 2. .Cat licenses are sold annually (July -September). Notices are sent in June. They become delinquent on October 1. Ongoing 3. Letters to owners of new dogs/cats are sent out based on rabies records sent by veterinarians. 4. In April and October, request delinquent animal license labels from Information This takes Services Department. Prior to this all purchased licenses must be entered 2-3 into the database by the City Clerk s Office. weeks. 5. Based on the number of labels from this delinquent list, reminder postcards are ordered (approximately 900 for dogs and 700 for cats). 6. Prior to mailing postcards, label list is compared with additional licenses purchased since the labels were created. These animal labels are removed from the postcard mailing. One 7. Postcards are mailed with an additional one-month deadline to purchase month licenses with the additional $10 delinquent fee. $ 30 for printing postcards $300 - $400 for mailing postcards 2 weeks 8• After new licenses have been data-entered, animal control officers create list of remaining delinquent licenses. 9. Citations, letters, envelopes and certified mail tags are then created and 2 - 3 weeks collated by the Health Department secretary and mailed via certified mail. (depending o $1200 postage 0 on number) $ 104 cost of citation books 4 - 6 weeks 10. The citation allows an additional 4 - 6 weeks for purchase of the delinquent One week 11. Seven to ten days prior to the court date, the animal control officers review the license (7 - 10 days prior to the listed court date). During this time, Health Services Department receives approximately one hundred calls from owners who no longer have the dog, have moved, etc. These animals are then deleted from the database (and citations are voided). delinquent list against new license purchases, verify the citations were delivered via certified mail (through U.S. Postal Service website), and compile final delinquent list. For this list, ACO's must add the violator's DOB and/or Social Security number to the citation for court purposes. This information is required by the court. 4 - 4'h total 12. Violators are fined via citations. Court orders are prepared and sent by the months for Clerk of Court office via mail. enforce- ment 13. Those receiving court orders then, frequently, call animal control wondering follow-up why they received a fine, etc., (sometimes years later when tax refunds, driver's licenses, etc. are withheld). EXHIBIT 2 Pet Licensing Database Inputting & Maintenance Notes Rabies inputting for all five vets from September 2006 -January 2007 (there were some records from May -August 2006 also). Took about 1 1/2 weeks to catch up. It takes approximately 2 - 4 hrs. to input each vet's records (this time includes interruptions and perForming regular work). Using this figure, it would take approximately 10 - 20 hours per month to put in the rabies information. When Health Services started the catch-up process for inputting rabies certificates, the number assigned for new owners was at 00845. When I finished putting the accumulated rabies records in the number being assigned was in the 1200 range. That means that there were appx. 350+ new dogs/cats put in (some owners had more than one new animal). The majority of these new animals were dogs and if they had been in the system, the owners would have received license notices that went out in January. Figuring a license fee of $10 (lowest amount), the license fees not collected could amount to $3,500 or more. This is just an estimate, but it's obvious that revenue was lost because these animals weren't in the Pentamation system. Keeping up with all the animal deletions (dead, moved, etc.) takes approximately four hours a month. It's much easier when you do it as they come in rather than accumulating stacks of them. This also keeps the database up-to-date. Citizen called in on 3/15/07 and stated he had sent in his check at the end of 2/07 (or 3/1/07). He had not received the tag yet and was checking to make sure that it was received by the City. CJ called SW in Clerk's Office and was told that it was received, just not processed yet. She said he should have his tag by 3/19/07. CJ told citizen. On 3/19/07, CJ looked up citizen to verify that it was done. Record still showed a bill. CJ called SW and was told that tag was sent, but posting wasn't done yet. On 3/21/07, the money was finally posted, but no tag number was on database. Citizen said he received the tag on 3/19/07, however. Inputting bills, sending out tags, and inputting the license/tag numbers into the database are not done at the same time. This makes for fragmentation of information. For instance, if this citizen's dog was impounded, it doesn't show that the dog has a current license even though it's been purchased/ issued. The citizen would have the burden of proof. Granted, the time gap may not be great, but during that time, the records are incorrect. Prepared by: Chris Johnson, Secretary EXHIBIT 3 DIALOG BETWEEN HEALTH SERVICES DEPARTMENT STAFF AND PETDATA STAFF JANUARY 31, 2008 Who is PetData? PetData is the only private company focusing exclusively on animal licensing. We provide a complete turnkey licensing program for municipalities, counties, humane societies and any other groups and agencies that license animals. How long has PetData been in business? PetData was founded in 1993, began animal licensing operations in 1994, and started administering its first contract in May of 1995. What does PetData cost? Costs vary based on the needs of each agency, but typically run from $3.75 - $3.85 per license. Are there are any up-front fees? No, there are no up-front or setup fees required to contract with PetData. PetData is paid on a per-license basis. However, if a customer requests historical data to be entered, PetData may charge for this service. What is included in the price? PetData provides a complete turnkey operation. Included in the price are the following items: 1. Toll-Free telephone number 2. Renewal Notices 3. Second Renewal Notices 4. Billing Cards 5. Second Billing Cards 6. All supplies to veterinarians and authorized registrars to license with the exception of tags which the municipality purchases 7. Database Administration 8. Customized web site 9. Professional Customer Service 10. Ongoing Communication with Veterinarians Can agencies choose the style of tag or does PetData make the choice? Agencies have the option to choose their tag style or they can ask PetData to do it. What animal software programs can PetData work with? PetData works with virtually every animal shelter software available on the market today and its current clients utilize several different programs. PetData has worked extensively with Chameleon software. Please see our Partners page for more information. Typically shelters spend an average of $4.50 to $5.00 to administer each license. Why is PetData so inexpensive? As a business, PetData focuses exclusively on licensing and is extremely efficient while providing a high level of customer service. Since PetData only gets paid based on the number of licenses, we have to be very efficient. Why is PetData so expensive? "My shelter doesn't spend nearly that much on licensing." After extensive research of shelters across the country, PetData has not found a single shelter that provides all of the same services PetData provides for less. Sometime shelters say they spend less, but they often don't include all of the costs such as wages, overtime, fringe benefits, computer hardware and software, postage and shipping and other costs. PetData handles all of these costs as part of its fee. How does PetData get paid? We offer a very low-risk payment structure; PetData is paid solely on performance. Unlike many services today which require up-front payments, PetData requires no advance payments. Instead, we are paid a set fee for each license on a monthly basis; the fee is based on numerous factors, including the licensing fee of the community, as well as the level of work requested by the community. How do citizens pay for a license and how can a municipality monitor the payments? Currently, PetData has two types of financial arrangements for municipalities. One method is to set up a bank account under the name of the municipality. The bank account is used solely for the purpose of collecting and disbursing funds that specific municipality. For example, PetData would set up a bank account at a local bank under the name of "PetData, Your City's Animal Licensing." Citizens of your municipality make their payments to "Your City's Animal Licensing" and we deposit the money into the account. At the end of each month, we prepare a report listing the amount of money to be paid to your municipality and to PetData. At that time, we mail a check to your municipality and write a check to PetData to be deposited into our general bank account. We can send a copy of the check register, as well as the bank statements, either on a regular basis or upon request. Furthermore, your municipality can audit the bank account at any time. This provides the greatest convenience to each municipality, while providing oversight and security for the funds. The second type of arrangement is to receive payments from citizens and from veterinarians and deposit the money directly into a municipality's bank account via a local branch. At the end of each month, PetData submits an invoice and appropriate supporting documentation to the municipality and is paid within thirty days. How do our citizens contact PetData since they are not located in Dallas? Although PetData is physically located in Irving, Texas, we provide services nationwide. As a result, we want to make it very easy for people in every community nationwide to contact us. Therefore, we set up a unique toll-free phone number for each municipality. The unique toll-free number allows us to know where a call is coming from and answer the phone with the name of your municipality. This number can be imprinted on the license tags which makes it very easy to reach us, at no charge to the individual. Our web address can also be printed on the tags, and citizens may obtain licensing information, look up a tag number, or email our office at any time of the day or night. Can PetData work with our veterinarians? Yes! Veterinarians provide a key link to the citizens of your community. We are constantly working to make it easier for veterinarians to participate in animal licensing through streamlining of paperwork and direct data transfer from popular practice management software. What about deletions for animals/owners that have moved out of town, died, no longer have the animal? The history is maintained in the database, but marked not to received renewal notices/licenses. What about address/name changes? PetData enters all changes to the database. When the City discovers a change, all we have to do is a-mail, fax or mail them the information and they'll make the changes. They national change of address database and Post Office change of address database. Does PetData do all the rabies vaccination inputting and do the vets send information directly to them or through us? PetData does all the rabies vaccination inputting. We can have the vets send them the information, and they will also keep track if a vet doesn't send the required monthly information. How is license revenue returned to the City and what form of audit reports are available? How often is the revenue returned? Can people pay on-line with credit/debit cards? They can do electronic transfers directly to our account, or we can use a bank branch that the City's bank does business with. The checks are all scanned for an audit trail. Documentation is sent to the City regularly. Citizens will be able to use a credit or debit card w/Visa or MasterCard logo. Will all dog license still be due at the same time (January 1) and cats (July 1), or will they be staggered throughout the year? They can do whatever we want. Possibilities include leaving it as is or having them expire on date of purchase. We could also shorten the length of "grace period" before delinquent fees are added. What about penalties if licenses are not purchased with_ in the grace period (3 months from when they are due)? They can add the penalty after the "grace period" according to our instructions. What is the process if the Animal Control Officers discover someone that has adog/cat, but they are not in the database? Currently, they give them a notice to purchase the license within 10 days? How would these people get PetData the rabies vaccination information and purchase the license within that timeframe? We could set it up that someone is allowed to sell the license locally and then send the information to PetData. Or we could lengthen the time we give people to get the license so they would be able to send PetData the required paperwork and payment. Currently, spayed/neutered animals are licensed at a lower rate. What is the process if a dog/cat is spayed/neutered after they have received the license renewal notice, but before they have paid their license fee? Do they send in the proof with the lower fee? If people send in the lower paperwork, they update their records and they will just accept the lower fee. Does PetData take the word of owners that they no longer have the animal, or are they required to send some proof, i.e., death certificate from vet? Currently, we take their word for it. They will do whatever we want, but typically, they accept people's word for it (as we do). Can PetData collect the owner's date of birth (in case we have to take them to court for anything? They've been discussing that and think it's a good idea. They will do whatever we wish. How long does it take after receiving rabies vaccination and/or license payments, to update the database? It would be available on the database within 5 business days, but it would take approximately 10 business days to mail out the tag. How would the City have access to the system? The City would have a secure login. If PetData goes out of business what happens? The data belongs to the City and it would be provided to us. Health Services Department license-related costs Printing of renewal notices., postcards, window envelopes, etc. - $1177 Postage for mailing renewal notices and tags (appx. 8,000 @ .41) - $3280 Health Services Secretary (rabies inputting and deletions/changes) -20* hrs per mo (13%) salary & fringe - $519 X 12 mo = $6228 Animal Control Officers - 10* hrs per mo (8%) salary - $209 X 12 mo = $2512 TOTAL (Health Services) _ $13,197 City Clerk's Office license-related costs - ?