Monticello council’s review of FiberNet billing software situation generates friction

Monticello’s quest to obtain a FiberNet software program independent of a management service contract generated friction during Monday’s city council meeting.

Council members previously authorized purchase of billing software and associated support services from Great Lakes Data Services (GLDS) at their March 10 meeting.

Software from the company was initially favored because city staff was somewhat familiar with it and FiberNet Monticello customer data was already in place.

However, when city staff was unable to obtain a key licensing assignment, staff made an executive decision to spend $10,000 with a new company.

Councilmember Glen Posusta asked that the item be pulled from the consent agenda for further discussion.

“The reason that I pulled this off, is No. 1, I don’t understand why [city] staff made a judgment call to spend $10,000-plus dollars without City Council approval. That’s my first beef. I don’t understand the urgency of doing this so quickly.”

Posusta wanted to know why the city could not make a “logical decision” on a billing system for FiberNet and was concerned about the possibility of rushing into something that might be regretted later.

Mayor Clint Herbst asked Finance Director Wayne Oberg to provide an explanation. Oberg was acting as assistant city administrator during Monday night’s meeting and addressed the issue because City Administrator Jeff O’Neill was out of the office.

“Why don’t you go over it, and explain the urgency of why we had to purchase the other software,” Herbst said.

Posusta replied: “Two weeks ago, the City Council made a motion to approve a different software vendor. There’s a lot of chaos going on.” Herbst said: “Not anymore, there isn’t,” leading into Oberg’s comments.

“It certainly looks that way, but the chaos isn’t on our part,” Oberg said forcefully. “We started the beginning of March with our contractor [FiberConnect, owned by former FiberNet general manager Mark Pultusker] telling us he wanted $9,500 to run billing software for March. Mark said if we didn’t pay that, we would not get the bills out.”

Service, software cost concerns

Oberg said the council and staff decided the city should purchase its own billing software and save money.

“We asked Mark to assign the billing software modules that he has, because we may have some obligation to pick up one of those modules. We waited, and waited and waited and gave him a deadline to respond, and then he responded by providing one of the modules. We thought, ‘OK, we’ve wasted a whole week that we needed.’ ”

According to Oberg, city staff began searching for a solution. “I contacted [Willmar-based] Source One Solutions, and they guaranteed me that we would have a billing software package in place by the end of the month. They contacted me today (Monday) by email, and they reported that they had all of the data to the monthly bill entered. There is some grooming of the data that has to go on, but we have a whole week to groom that data. Granted, we did spend $10,000. The other option was wait another month and pay Mark. Everytime we came to a juncture, he didn’t respond. At first it was $9,500 a month.”

According to Oberg, during a special council workshop March 10, the council reviewed a proposal from Pultusker that would have paid him $9,500 a month for three years, or $114,000 annually or $342,000 for three years. “With Source One, we would pay $76,000.”

Posusta said nobody was going to go three years. “No one up here had the stomach to pay what Mark wanted,” Posusta said. “But that’s neither here nor there. What we are talking about is the urgency of getting a new billing system”

Posusta said Pultusker was willing to provide April’s billing for nothing so the city would have time to sit down for discussion.

Herbst replied that Pultusker told the city he would have the licensing assignment at 5 p.m. on a Friday, and he never came through.

Pultusker, who was in attendance at Monday night’s meeting, asked for an initial opportunity to respond. After Herbst said the FiberNet billing software discussion wasn’t part of a public hearing, Pultusker did not get up and attempt to speak.

Points of contention continue

Oberg continued by stating: “This has sort of turned into a game of chicken between us and the contractor,” he said. “We’ve already made a decision to go forward. Two Mondays ago, he proposed $9,500 a month. When he [Pultusker] found out the city was going to purchase its own billing software, he offered his for free for a month.”

Posusta asked if the city had a contract in effect with Great Lakes Data Services or FiberConnect, Pultusker’s business. Oberg said Pultusker had breached his contract with the city.

Herbst said when Pultusker quit Feb. 21, the contract was null and void. Posusta said his concern was the city’s buying another billing system and that the city could end up in court and be forced to buy the old billing system back as well as a new system.

Herbst replied: “Mr. Pultusker made a decision that he wanted his own billing system. Now he has one. Any other questions?”

Pultusker asked, “As a citizen, I’m not allowed to say anything?” Pultusker was referring to the fact that prior to the start of the meeting, he had signed a speaker sign-in sheet, listing his address as West River St.

Herbst again replied: “This not a public hearing. I’ve already put up with enough of what you’ve been saying.” Pultusker stated the earlier comments by staff and council were not accurate, and that he had email records as back-up.

Councilmember Tom Perrault wanted clarification about Source One’s operational history and its relationship to Dan Olson, a Windom, Minn, consultant who will now provide technical service and network architectural support to the city of Monticello.

Source One Solutions CEO David Langerud addressed the council to explain that business relationship.

“His southwest Minnesota broadband company [WindomNet] has also been a customer of ours,” Langerud said, adding that HBC, the city’s former billing software company, was also a client of his company. “We do their printing for them. Their billing software is a competitor to ours.”

Langerud said his company had 70 customers, and 20 of those customers only had printing contracts. Posusta asked Langerud if his company had completed billing system data entry for all FiberNet Monticello customers and if there were any glitches.

“I can’t promise there won’t be any glitches,” Langerud said, adding that his company had entered every single customer from the city’s March billing. “Their bills will look identical in respect to what appeared March 1. That’s what they will see in April, so there is no confusion. They will get an 8 1/2 by 11-inch bill, that will have instructions on how to read your bill,” he added.

City clarifies former GM’s status

Oberg displayed a Feb. 28 email on the council chamber main screen and provided additional details about Pultusker’s status.

“When Mark quit, he breached his contract,” Oberg said. “We needed to get the billing out for March. Mark turned around and charged us $9,500. Before he came back from wherever he was, we left an assignment [document] for GLDS software at the city headquarters for FiberNet. Mark showed up, saw that and shredded it. I saw that, and to me, that indicated we were dealing with someone who would not work with us anymore. Shortly after that, this is the email that we received.”

Oberg pointed to a highlighted sentence written by Pultusker that stated he had no interest in assigning his contract to the city. “He put us in a bind,” Oberg said. “We were going to buy our own GLDS software. Let’s say we did that. Mark would not have to give us the data that’s on his system. We would have to rekey the data.”

Oberg referenced another email, stating that Pultusker would give the city the data, but at a cost. “We’ve tried all along to get some sort of smooth transition, and the way I look at it, I led the council down this path. [City Administrator] Jeff O’Neill and I worked together on this. If you decide that this $10,000 isn’t money well spent and it doesn’t work out with Source One, I’m the one who is responsible, and I’m willing to accept the consequences.”

Langerud said he was willing to consider a contract addendum to help the city. “Source One is all about helping customers,” he said. “We are an extension of your town, your office. We want to help you. Your customers are the No. 1 people we care about. We’ll put something in as an addendum in the contract that if the city is forced by a court of whatever to buy the old system back, we won’t hold you to a normal three-year contract. If you need that addendum, we’ll put in into the contract for you.”

Customer communication update

Rachel Leonard, Monticello’s communications coordinator, has been supporting FiberNet’s marketing and communication efforts since being hired by the city last August.

She said that for the past week, the city has been working with marketing campaigns involving phone scripts and mailed postcards, which will be used to explain billing system changes. “I’ve also spoken with Source One about how customers will work through these new bills,” Leonard told the council.

Posusta wanted to know about printed statements with the new billing system. Leonard said any customers who sign up with autopay in the future ask to have have a printed bill eliminated. “The other nice thing Source One mentioned to us is that we will be able to tailor billing messages to specific groups,” she said.

Herbst praised Oberg and O’Neill for keeping in contact with him and Councilmember Lloyd Hilgart about the recent billing system developments. Hilgart was not in attendance Monday night.

“We just felt like we had our back up against the wall,” Herbst said, referring to the council’s decision to find another solution. “This is a much better deal,” he said. The council unanimously approved the purchase of FiberNet billing software and associated support services from Source One.

Pultusker’s response

Pultusker refuted a number of points mentioned by Oberg after he left Monday night’s council meeting. “I did shred the assignment document [mentioned by Oberg],” Pultusker admitted.

“It was a ridiculous assignment not written by attorneys. He wrote it up himself. An assignment is a license. I would have had to assign my software license to the city. It has to be done within a legal document. The one he presented was something that he wrote up on his own,” he said.

Pultusker said he spent $100,000 on the FiberNet software billing system as part of the services he provided the city. “I don’t go out and spend $100,000 frivolously” he said. “I spent it because they [the Monticello City Council] gave me the impression that we had a longterm agreement. Everybody is showing little bits and pieces, but no one is showing the entire package.”

Pultusker was also unhappy with the city because he said City Administrator Jeff O’Neill ordered his access to the billing system shut off Feb. 25. City Attorney Joel Jamnik commented on that development in an email to the Monticello Times.

City offers additional explanation

Jamnik confirmed O’Neill gave the order to terminate Pultusker’s access after Pultusker resigned Feb. 21. Jamnik also stated Pultusker’s company, FiberConnect, had been retained to assist the city with billing services in March, but city leaders decided to transfer billing to another company but retain ownership of past bills.

In an email, Oberg further explained why the GLDS software was initially favored going forward.

“FiberNet currently runs GLDS software. However, our current general manager contractor [Mark Pultusker of FiberConnect] owns the license,” Oberg explained.

FiberConnect charged the city $9,500 to use the software for March, Oberg stated in an email Monday afternoon. He said FiberConnect also wanted $9,500 a month to use the software for the next 36 months.

“At the time [of the March 10 Monticello council meeting] staff thought this would be the best route for consistency purposes. However, this would have required extensive internal resources [city staff] to re-enter customer data because FiberConnect owns the data within Pultusker’s licensed GLDS system. Mark said he would provide the information at a cost. GLDS software licenses has upfront costs, annual renewal costs and monthly support costs. SourceOne does not- it only has a flat monthly charge of $2,000.”

After finding out the city had moved on, Oberg said Pultusker changed his mind about the assignment, but GLDS wanted two assignments to make them whole, Oberg said that Pultusker only offered one license assignment, forcing the city to provide payment for his system data.

Business relationship goes south

Pultusker contends the city violated his contract, firing the first shot by cutting off access to property (equipment) that he owns.

“After I quit on Friday, [Feb. 21] I met with Jeff [O’Neill] on Sunday [Feb. 23] and did an alternate proposal,” Pultusker said during his interview Monday night. “We spent time together, and Jeff said he was still working on getting me an answer. On Tuesday morning [Feb. 25] Jeff sent me an email that said, ‘Hey, send us the bills that we owe you, I’m still working on getting your response. An hour later, my access to the FiberNet Monticello billing system was shut off. That’s when all hell broke loose.”

In an email sent Tuesday morning to Oberg, O’Neill and all City Council members, Putusker added: “I don’t feel I breached my contract. I still informed the city I was intent on fulfilling the billing function … I had ample opportunity to restrict city access and harm the city but did not do so for legal and more importantly moral grounds. Therefore, it would be helpful to know why my [system] access was shut off – since that is what lead to all this disarray and extra expense.”

Contact Tim Hennagir at tim.hennagir@ecm-inc.com

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