The Birmingham Water Works Board is spending $7 million to overhaul its main computer system before the software becomes obsolete.

The utility must replace the current system used to track water meters, billing, maintenance and work orders before it dies in 2027.

“Almost everything we do is run through SAP at this point in time,” said General Manager Mac Underwood.

The software known as SAP or System Analysis Program Development, was initially brought to the water works by Houston-based company Utegration LLC. Utegration was acquired by Cognizant, the company tapped by the water works to rebuild the SAP system.

Underwood said that a computer system is essential as the water works begins to implement automatic meter reading.

Officials have said new meters would improve efficiency and accuracy in monitoring usage in real-time after years of challenges regarding billing. Those challenges spawned customer complaints and political outrage throughout the five-county service area.

“Before we can do automated meter reading infrastructure, we have to have this upgrade in place,” Underwood said. “It’s really an upgrade to the current system with some new features.”

SAP upgrades will take 12-15 months. Meanwhile, the utility in a few months will seek proposals to build its automatic meter reading program.

That massive multi-phase process of installing 220,000 new meters begins with $10 million in fiscal 2025. The total project is about $120 million.

The new SAP system will be cloud-based. Barry Willaims, interim general manager of finance and administration, also called the new SAP essential to the upcoming automatic meter reading infrastructure (AMI). Also essential, he said, is a new customer portal where users can track their own water usage online.

“They are trying to encourage all of their clients to get on the cloud solution, but the reason we are pushing it earlier is because of the AMI,” Williams explained.

While it was bought to bring better efficiency to the water works, SAP has not been without controversy.

Underwood in 2017 touted the $10 million SAP system as a solution to customer billing issues. Yet, similar customer complaints grew in 2021, under the administration running the utility at the time.

At that point, Underwood, who had left the water works, was then retained by the utility as a consultant to help address customer service problems and work with SAP.

In August 2022, Underwood was again hired as a consultant to help the utility manage its customer service crisis regarding faulty billing and collection.

The Jefferson County Commission bought the SAP software in 2004 but tossed it in 2014 after spending $20 million over several years and a series of negative reviews from county officials.

Still, Underwood and Williams said water works customer service problems were mostly due to human error, rather than SAP.

“Very early on, Birmingham Water Works experienced a few issues with the implementation of the SAP system, the kind of issues that commonly occur when you install new software,” Underwood said. “Those initial issues were resolved expeditiously, and the system has performed well since.”

Operational errors occurred because customer meters were not being read in a timely manner, Underwood said. New schedules for routes and readings have improved billing and timeliness, said Underwood, who was re-hired to lead the utility in February.

“It was all about the meter reading in the billing that caused the customers problems,” he said.