Last Update:  6.51
- Fixed an issue where the budget billing date was not getting set correctly when the customer was set to auto re-enroll in Budget billing at the end of the contract

Budget Billing Contract

Budget Billing allows a customer at an active customer location to pay a set amount each bill cycle over the length of an agreed upon contract. This set amount is known as the Contract Amount and is based on an historical average of selected services over a set length of time. The length of the contract, the length of time before the contract amount is recalculated, and the date range of bills to be considered for the contract amount, are all set in the UB System Settings as a specified number of months. The UB System Settings also include a field to increase the contract amount by a specified percent to "fudge" the averaged bill amount, increasing the likelihood of the customer's bill being paid in full (or overpaid) each bill cycle, preventing a balloon payment at the end of the contract.

Notes regarding the budget billing system settings:

  • A minimum contract length of one (1) month is required for budget billing to operate.
  • The contract amount can be adjusted every two (2) months at minimum. Adjusting the contract amount each month is not supported.
  • A minimum value of one (1) month of history is required for determining the average bill on a metered service. A value of zero (0) will result in an average bill and amount of zero for all metered services.

Budget Billing Date

The date chosen to begin the budget billing contract; the budget billing date is a point of reference for all budget billing date range calculations (inclusive in all cases). The Contract Amount can't be calculated until a budget billing date is selected. The contract will run from the budget billing date for the number of months chosen in system settings. At that point the contract will have expired (see Contract Expiration). It is the start from date when determining if the contract amount can be adjusted automatically. The budget billing date is also the end point of the range of dates considered when determining the average bill of metered services.

Note: The first billing date on a bill run that can include a new budget billing contract is the day after the budget billing date.

Contract Amount

The contract amount is computed from the combined totals of the fixed service(s) and metered service(s) that are selected on the Compute Contract Amount screen. Fixed services contribute their standard flat amounts towards the contract amount when selected. The budget billed amount for each metered service on each meter is determined by dividing the total of all qualifying transactions by the number of qualifying transactions. The resulting bill average is the default amount for that metered service's contribution towards the contract amount, but this value can be manually overwritten.

A qualifying transaction is one that contains the following criteria:

  • The transaction has gone through the billing process and is marked "IsBilled".
  • The meter on the transaction matches the meter being averaged.
  • The service code on the transaction matches the service code being averaged.
  • The transaction's related transaction code must track usage ("TrackUsage" is true).
  • The date of the transaction is within the date range chosen, calculated by subtracting the number of months of history to pull from, as determined in system settings (starting date), from the budget billing date (end date).

Transactions that were created between the start and end date, inclusive, and pass all other criteria qualify for consideration, and will have their transaction amount added to the total to be averaged. They are also included towards the number of transactions the total will be divided against. The result is the average bill (qualified transactions total/number of qualifying transactions) for each respective metered service.

If there are no qualifying transactions found the average bill and amount fields will display zero (0.00). The amount field can be manually overwritten, but no assistance towards a reasonable estimate will be provided. If this metered service is included in budget billing with an amount of zero the metered service will not bill anything until the contract attempts to settle up, regardless of usage. This could cause an enormous lump sum payment to be required upon settling up.

Contract Expiration

There are three ways to end budget billing on a customer location:

  • The current contract exceeds its contract length.
  • The Settle Contract option from the customer location's Billing Options screen is selected.
  • The customer location is finalized.

The next time a bill run is completed, the customer location will no longer be enrolled in budget billing. The bill created by this bill run will contain the "settle up" amounts for each service. The outstanding amounts for each service are calculated by totaling how much was paid over the length of the contract subtracted by the total amount of what the bills would have been for normal billing over the same length of time.

If the "Automatically re-enroll" option was selected in Billing Options, then the budget billing date will be updated as well as the contract amount when the same bill run is completed.

Settle Contract Calculation

When settling the budget billing contract, the customer has to pay off the actual charges owed deducted from the budgeted amount they paid. Typically, these amounts would be close together so the customer wouldn't be left with a big bill at the end.

Here's an example based on 4 months where the customer settles on the 4th month. For simplicity, I have taken out any payments the customer would likely have made.

*Settle contract month

ACTUAL WATER CHARGES

1/15 $100

2/15 $80

3/15 $115

4/15 $75*

Total = $370

BUDGETED WATER CHARGES @ $35

1/15 $35

2/15 $35

3/15 $35

4/15 *

Total = $105

It's important to understand how this is written to the database in Smart Fusion. This is how the records are added to the database and this is by design so the amounts get written to the correct transactions:

TRANSACTION TABLE (AR012)

WA $35

WA $35

WA $35

WA $265 ($370 - $105)*