HomeMy WebLinkAboutR-2012-066 Water Division Cost of Service and Rate Study Update; Agreement w Financial Consulting Solutions Group, Inc.RESOLUTION NO. R — 2012 -66
A RESOLUTION authorizing the City Manager to execute a Professional Services
Contract Agreement between the City of Yakima and Financial
Consulting Solutions Group, Inc., in an amount not to exceed
$27,000, to develop a Cost of Service and Rate Study Update.
WHEREAS, the City of Yakima desires consulting services to provide a Cost of
Service and Rate Study to obtain a fair and accurate assessment of the Drinking Water
rate structure and charges and how it relates to projected future needs and requirements;
and,
WHEREAS, the consulting services provided will review the historical financial
performance of the water utility, evaluate existing financial policies /practices, and
recommend alternative practices that may further City goals in funding utility obligations;
and,
WHEREAS, the City of Yakima desires to review the existing water connection
charge adequacy while remaining consistent with industry practice and Washington State
guidelines RCW 35.92.025; and,
WHEREAS, a strategy to fund water capital needs as identified in the adopter
2011 Water System Plan, including a forecast of the operating revenues and
expenditures and an analyze of the financial performance of the water utility over the six
(6) year study period with a recommendation of a rate revenue adjustment strategy; and,
WHEREAS, assigning "cost shares" and establishing "equity" for utility customers
based on their demands and usage of the water system will be reviewed; and,
WHEREAS, rates, charges and fees imposed to recover the cost of fire
suppression will be reviewed; and,
WHEREAS, funding for such services was included within the 2013 authorized
budget; and,
WHEREAS, the City Council has determined that it is in the best interest of the
City to enter into a professional services contract agreement with a consultant selected
for such expertise, now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA:
The City Manager is authorized and directed to execute a Professional Services Contract
Agreement between the City of Yakima and Financial Consulting Solutions Group, Inc., in
an amount not to exceed $27,000, to develop a Water Cost of Service and Rate Study, a
copy of such agreement is attached hereto and by reference made a part hereof, now,
therefore,
ADOPTED BY THE CITY COUNCIL this 15th day of May, 2 12
Micah Cawley, Mayor
TTEST. -�P�" "
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April 24, 2012
FINANCIAL CONSULTING
SOLUTIONS
GROUP, INC.
Redmond Town Center
7525— 166`h Ave. NE, Suite D -215
Redmond, Washington 98052
CONTRACT AGREEMENT
BETWEEN
AND CITY OF YAKIMA
Water /Irrigation Division
2301 Fruitvale Boulevard
Yakima, WA 98902
PROJECT: 2012 DOMESTIC WATER SYSTEM RATE UPDATE
Page 1
THIS AGREEMENT combines all understandings between the Parties regarding professional
services for the Project named above and supersedes all prior proposals, quotations, solicitations,
negotiations, representations, agreements or understandings, whether written or oral.
The performance of the professional services herein described and authorized by the City of
Yakima, as well as payment for such services, shall be in accordance with the terms and conditions
presented in this Agreement and the following Sections and Exhibits which are attached and incorporated by
reference which, taken together, shall constitute the whole Agreement.
Section I - Relationship of the Parties
Section H - Contract Provisions
Exhibit A - Scope of Work and Task Plan
Exhibit B - Fee Schedule
Exhibit C - Study Schedule I�
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands and seals this I
day of , 20
APPROVED: Q APPROVED:
FINANCIAL CONSULTING CITY OF YAKIMA
SOLUTIONS GROUP, INC.
Date: �b2l'h '�Q
CITY CONTRAC I' NO: "��� �✓
RESOLUTION NO:
•:;e FCS GROUP
Michael A. Morales
Interim City Manager
Date: S (rt I a--
ATTEST:
IMq
CITY CLt&K ,'
x SEAL
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.fcsgroup.com
April 24, 2012
SECTION I: RELATIONSHIP OF THE PARTIES
Page 2
The City of Yakima ( "Client ") desires consulting services associated with and in support of the 2012
Domestic Water System Rate Update ( "Project "). In furtherance of the Project, the Client hereby contracts
with Financial Consulting Solutions Group, Inc. ( "FCS GROUP ") to perform the professional services
described in Exhibit A of this Agreement. All services shall be performed under the joint supervision of the
Client's Representative, Dave Brown, or a designee or designees identified in writing to FCS GROUP by the
Client's Representative.
This Agreement shall inure to the benefit of and be binding upon successors, assigns, and legal
representatives of each of the Parties hereto. Any assignment or transfer of an interest in this Agreement by
either Party without the written consent of the other shall be void.
SECTION II: CONTRACT PROVISIONS
1. Scope of Work: FCS GROUP shall perform the service for the Client which as defined in Exhibit A,
Scope of Work, which is attached hereto and hereby incorporated by this reference.
2. Time for Completion: The Scope of Work for the conduct of the study as set forth above is anticipated to
be completed by FCS GROUP within a time frame approximating that shown by the following schedule:
Notice to Proceed: On or before May 21, 2012
Completion of Draft Analysis: within 2 months of Notice to Proceed (NTP)
Presentations to Council: within 4 months of NTP
Completion of Project: On or before September 30, 2012.
FCS GROUP agrees to perform the work described in the Scope of Work according to the contract schedule.
Any delays shall be agreed upon by FCS GROUP and Client prior to the due date. Changes in the schedule
caused by Client delays may require additional compensation and a change order.
If FCS GROUP is delayed in the performance of services by conditions which are beyond their control, or by
a change in the scope of work, the schedule showing time of performance may be revised. Any revision
thereto shall be submitted in writing to the Client for review and approval by the Client Representative. If
FCS GROUP's services are temporarily suspended by the Client in the interest of the Project and with
written notice to FCS GROUP, and the suspensions last longer than 90 consecutive days, FCS GROUP shall
be compensated for any additional labor and direct expenses incurred due to the interruption and resumption
of services.
3. Payment: FCS GROUP will be paid by the Client on a time and materials basis as outlined below and in
accordance with the standard billing rates attached hereto as Exhibit B. FCS GROUP agrees to perform the
services as set forth in Exhibit A at a cost not to exceed $27,000. It is understood that FCS GROUP will not
exceed this amount without the Client's prior written authorization.
Payment to FCS GROUP for services set forth in Exhibit A shall be: an amount equal to FCS GROUP's
standard billing rates as set forth in Exhibit B multiplied by the actual hours worked. Should any unforeseen
project delays, not caused by FCS GROUP, and /or any requested amendments to the original scope of work,
cause this contract to extend more than 90 days past the original contracted schedule date, any work and/or
amendments to the work shall be billed at the standard billing rates in effect for the period of time the work is
being performed. If said change in billing rates will cause the project to exceed the amount stated in the
preceding paragraph, a change order will be prepared and signed by both parties.
Direct expenses will not be charged except as identified in Exhibit B. Payment shall be made monthly upon
receipt and approval of FCS GROUP's invoice.
':;> FCS GROUP www.fcsgroup.com
April 24, 2012
Page 3
4. Supplemental Agreements: Supplemental Agreements may be entered into upon mutual written
agreement that would increase or decrease the scope and associated costs and payment.
5. Work to be Accomplished: All work accomplished will be performed under the direction of the Client
Representative or his /her Designee.
6. Termination: This contract may be terminated by the Client by giving FCS GROUP written notice of
such termination no fewer than fifteen (l 5) days in advance of the effective date of said termination. FCS
GROUP shall be entitled to terminate this agreement only in the case of a material breach by the Client, and
upon failure of the Client to remedy said breach within fifteen (15) days of said notice. In the event that the
contract is terminated before completion, FCS GROUP shall be paid for the services to date on the basis set
forth in Paragraph 3, plus 10% of the total compensation earned to time of termination to compensate for
FCS GROUP's rescheduling adjustments, reassignment of personnel, and related costs incurred due to
termination. The Client shall notify FCS of termination or abandonment in writing.
7. Indemnity: FCS GROUP shall comply with all Federal Government, State and local laws and ordinances
applicable to the work to be done under this Agreement.
FCS GROUP hereby agrees to hold the Client harmless from and shall process and defend at its own
expense, specific claims, demands or suits at law or equity, arising from FCS GROUP's negligent
performance of the provisions of this Agreement; provided that if the Client and FCS GROUP are
concurrently negligent, FCS GROUP shall be required to indemnify and defend only in proportion to
negligence of FCS GROUP. These indemnity provisions shall not require FCS GROUP to defend or
indemnify the Client against any action based solely on the alleged negligence of the Client.
8. All Work Produced is Joint Property of FCS GROUP and the Client: The materials, computer
programs, reports, calculations, analyses, etc., generated by FCS GROUP under this contract including the
final report shall be the joint property of the Client and FCS GROUP. FCS GROUP may retain copies
thereof for work paper documentation and their own use unless specifically restricted in writing by the Client
as to use.
Computer models use generally available software, such as Microsoft Excel (TM), and FCS GROUP does
not intend or imply any warranty of those programs.
9. Financial Forecasts: Neither FCS GROUP's name nor the report and its financial projections may be
referred to or included in any prospectus or as a part of any offering or representation made in connection
with the sale of securities or participation interests to the public, whether through a public or private offering.
The information used in developing the forecast assumptions will be derived from published information and
other sources FCS GROUP considers appropriate. However, FCS GROUP cannot assume responsibility for
the accuracy of such material. Moreover, forecasts are subject to many uncertainties as to the future;
therefore, FCS GROUP cannot represent that the projected financial statements will be representative of the
results that actually occur. FCS GROUP will endeavor to include appropriate comments drawing the readers'
attention to these matters.
10. Integrated Agreement: This agreement together with attachments or addenda, represents the entire and
integrated agreement between the Client and FCS GROUP supersedes all prior negotiations, representations,
or agreements written or oral. This agreement may be amended by written instrument signed by both the
Client and FCS GROUP.
11. Independent Contractor: The parties intend that an independent Contractor /Client relationship will be
created by this agreement. No agent, employee, or representative of FCS GROUP shall be deemed to be an
agent, employee, or representative of the Client for any purpose. FCS GROUP shall be solely responsible
for all acts of its agents, employees, representatives, and subcontractors during the performance of this
contract.
•$.4, FCS GROUP www.fcsgroup.com
April 24, 2012
Page 4
12. Equal Opportunity: FCS GROUP is committed to the principles of providing equal employment
opportunities for all employees. The performance and diversity of our employees will help us meet the
challenges of the present and the future in serving our clients. This policy statement is a reaffirmation of our
long- standing commitment to provide equal opportunity on the basis of individual merit and personal
qualifications to employees and applicants for employment without regard to race, color, religious creed, sex,
sexual orientation or preference, gender identity, genetic characteristics or information of employee or
family, age, national origin, ancestry, marital status, citizenship, the presence of sensory, mental, or physical
disability, pregnancy /childbirth or related condition, medical condition, membership in the military service,
veteran's status, political ideology or any other basis protected by applicable federal, state, or local laws.
13. Notices: Notices to the Client shall be sent to the following address:
City of Yakima Water/Irrigation Division
Attention: Dave Brown, Water /Irrigation Manager
2301 Fruitvale Boulevard
Yakima, WA 98902
Notices to FCS GROUP shall be sent to the following address:
FCS GROUP.
Attention: Karyn Johnson, Principal
Redmond Town Center
7525 — 166 ' Ave. NE, Suite D -215
Redmond, Washington 98052
•:�� FCS GROUP
www.fcsgroup.com
April 24, 2012
EXHIBIT A: SCOPE OF WORK
Page 5
The following Scope of Work (SOW) identifies the activities that FCS GROUP will perform for the Project:
Task 1— Revenue Requirement Analysis
1.1 Data Collection /Review — Prepare an initial data request identifying specific data to be collected
from the City for the rate update, including such items as financial statements, operating budgets,
capital improvement program, debt service schedules, fixed assets listing, customer data, rate
ordinances, and water system plan. Once the data has been received, we will review the data and
make requests for any additional items or explanations as necessary.
1.2 Financial /Economic Assumptions — Initialize the model for the current budget year and update model
input sections to reflect current information for the following:
■ Customer growth, inflation rates, interest rates, and debt issuance terms.
■ Customer billing records (water consumptions, number of customers /meters, etc.) for year
ending 2011. City to provide updated customer statistics in the City's Rbillcon.xls spreadsheet.
■ 2011 actual performance and 2012 operating budget, including detail revenues, expenditures,
and fund balances.
■ Six -year capital improvement program.
1.3 Capital Financing Plan —Identify potential funding sources for the current CIP and develop
alternative financing strategies for the water utility. We will project capital funding needs, borrowing
requirements, and associated cash flows and fund balance for the six -year study period. We expect to
consider such funding options as bonded debt, state grants and loans (SRF /PWTF), and/or cash
financing from rates. The budget provides for up to three (3) alternative capital financing plans.
1.4 Operating Forecast — Forecast ongoing operating & maintenance expense, debt service, and other
cash obligations of the utility over the study period. Incorporate economic assumptions, additional
O &M expense, if any, resulting from the CIP, and /or other 'known changes in operational
requirements.
1.5 Revenue Needs Assessment — The revenue needs assessment identifies the total rate revenue to be
collected from customers. Incorporate results of Subtask 1.1 through 1.4 and develop alternative
operating cash flows for the water utility. Compare projected cash requirements against projected
revenue under existing rate levels to determine annual rate adjustments needed to satisfy projected
cash obligations. The proposed budget provides for up to three (3) alternative scenarios.
1.6 Assess Utility Tax Application — Evaluate and calculate alternative approaches to applying the City's
current utility tax. Options include continuation of the practice of imbedding the costs in the water
rates or adding the tax on top of the water bills to show the components separately.
Task 2 — Calculate Fire Protection Costs within Water Rates
Traditional ratemaking typically included the recovery of fire protection costs from water user rates.
The State Supreme Court (Lane vs. Seattle) ruled that fire hydrant costs (and potentially all fire
protection related costs) cannot be recovered through rates. Under their logic, this is a general
government service, the charges for which would be considered a tax, and must have statutory or
voter approval.
•:;> FCS GROUP www.fcsgroup.com
April 24, 2012
Page 6
2.1 Identify Fire Protection Costs — Working with the most recent Water System Plan, and based on
input from the City, determine the portion of the water system's operation attributable to fire hydrant
maintenance and the provision of fire related services and remove those costs from the updated water
rates.
2.2 Determine Strategies for Recovering Costs — Work with the City to establish policy objectives and
potential strategies for the recovery of those fire protection costs through other means. The Court
upheld that an increase to the utility tax on the water utility to recovery those costs is valid and
within statutory authority. We will calculate the percentage increase needed in the current utility tax
to recover the identified fire protection costs should the City wish to move in that direction. As an
alternative, a direct payment can be made from the General fund to the water utility to recover those
costs.
Task 3 — Cost of Service Allocations
3.1 Customer Statistics — Review /evaluate summary water system and customer billing histories and
statistics, as provided by the City, to determine whether changing usage patterns indicate a need to
revise current customer class designations or peaking requirements.
3.2 Cost Allocations — Update model to reflect current fixed asset records. Review existing plant and
O &M cost allocation factors and distribution of costs to customer classes to determine if existing
parameters remain valid. Update or revise as warranted.
3.3 Rate Design — Update rates to reflect necessary rate adjustments, cost of service findings and other
policy considerations. The phase in strategy from a declining block rate to a uniform rate was
accomplished in year. We do not anticipate the need to prepare alternative rate structures at this
point. Rate forecast options will include applying the indicated rate increases across - the -board to
existing rates and /or incorporating the cost of service findings for the fixed and variable rate
components. The budget provides for up to two (2) alternative rate scenarios.
3.4 Typical Bills — Prepare sample customer bills consistent with the rate forecast options and selected
utility tax application.
Task 4 — Connection Charges
4.1 Update Domestic Connection Charges — Based on current general benefit water system
infrastructure, eligible capital projects and system capacity estimates, update the current schedule of
domestic connection charges.
4.2 Update Base Irrigation Charge - Based on current general benefit water system infrastructure,
eligible capital projects and system capacity estimates, update the current schedule of base irrigation
connection charges.
4.3 Update Local Distribution Connection Charges — Based on current local distribution system
infrastructure, eligible capital projects and capacity estimates, update the schedule of local
connection charges.
Task 5 — Meetings & Documentation
5.1 Staff Meetings — Prepare for and attend up to two (2) onsite meetings with Division staff to collect
data and review interim findings.
5.2 Presentations — Prepare materials for and attend up to two (2) work sessions or City Council
meetings to present study results.
•:,� FCS GROUP www.fcsgroup.com
April 24, 2012
Page 7
5.3 Reports — Prepare a project report, similar in format to the City's previous water rate study report. It
is anticipated that the City will provide input regarding historical accomplishments, future goals, etc.
One (1) draft and one (1) final report will be submitted electronically to the City.
•;*.-:> F C S GROUP www.ksgroup corn
April 24, 2012
EXHIBIT B: FCS GROUP STANDARD FEE SCHEDULE
Effective February 1, 2012
LABOR
Position /Title Billing Rate
Page 8
President
Standard Rate
$225
David Findlay
Program Director/Principal
Standard Rate
$225
Edward Cebron
John Ghilarducci
Karyn Johnson
Principal
Standard Rate
$200
Peter Moy
Angie Sanchez Virnoche
Senior Project Manager
Standard Rate
$195
Todd Chase
Don Garter
Robb Grantham
Senior Special Projects Manager
Standard Rate
$185
Pam Bissonnette
Dean Ritchhart
Project Manager II
Standard Rate
$175
Gordon Wilson
Project Manager I
Standard Rate
$155
Nihat Dogan
Project Consultant
Standard Rate
$140
Courtney Black
Chris Gonzalez
Nathan Reese
Sergey Tarasov
Doug Gabbard
Senior Analyst
Standard Rate
$120
N/A
•:,� FCS GROUP www.fcsgroup com
a
April 24, 2012
LABOR - Continued
Position /Title
Analyst
Ryan Blake
Tyler Lee
Catherine Otten
Tage Aaker
Krista Shirley
Administrative and Technical Support
Public Relations
Taree Bollinger
Scott Lester
Technical Writer /Editor
Debbie Gere
Standard Rate
Marketing /Graphics /Administrative Support
Cindy Cornell
Administrative Support
Diane Harmon
Kathy Lyons
Billing Rate
$100
•:,�
$120
$ 90
$ 70
$ 70
Page 9
DIRECT EXPENSES
Major direct expenses, such as travel and lodging, will, be charged at cost plus 5 %. Other expenses will not
be directly charged unless by mutual agreement of the client and FCS GROUP and specific terms will be
established in advance prior to expenditure and billing.
SUBCONSULTANTS
When applicable, subconsultants will be charged at invoiced cost plus 10 %.
F C S GROUP www.fcsgroup.com
Ap Page 10
ril 24, 2012
EXHIBIT C: PROJECT SCHEDULE
Performance of the Scope of Work described in Exhibit A will begin immediately upon notice to proceed.
Major milestones are estimated as follows:
• Notice to Proceed (NTP): Expected mid -May, 2012
• Review Draft Study Findings with Division Staff: Within 2 months of NTP (mid -July, 2012)
• Submit Draft Report: Within 3 months of NTP (mid- August, 2012)
• Presentations to City Council: Within 4 months of NTP (mid- September, 2012)
Submit Final Report: Within 4.5 months of NTP (September 30, 2012)
>FCS GROUP www.fcsgroup.com
BUSINESS OF THE CITY COUNCIL
YAKIMA, WASHINGTON
AGENDA STATEMENT f�
Item No.
For Meeting of: May 15, 2012
ITEM TITLE: Resolution authorizing an agreement with Financial
Consulting Solutions Group, Inc., in an amount not to
exceed $27,000, to develop a Water Division Cost of
Service and Rate Study Update
SUBMITTED BY: Joan Davenport, Acting CED Director
David Brown, Water /Irrigation Manager
CONTACT David Brown, Water /Irrigation Manager, 509 - 575 -6204
PERSON /TELEPHONE:
SUMMARY EXPLANATION:
In 2007, a cost of service and rate study ( "COS &RS ") was completed and water rate
adjustments were made in 2008, 2009, 2010, 2011 and 2012. The 2007 COS &RS predicted
that the rate adjustment would be adequate through 2012 and that a COS &RS update
would be required in 2012 to analyze the cost of service and to determine if a rate
adjustment would be needed beyond 2012. The projected revenues from the 2008 -12 rate
adjustments that have been implemented have fallen significantly short of projections due to
a variety of reasons, such as the downturn in the economy and better water conservation
being practiced by our customers. A COS &RS is necessary to determine what rate
adjustments are necessary to keep revenues in line with expenditures, fund capital
improvements, and to sustain adequate reserves. City representatives have contacted
Financial Consulting Solutions Group, Inc., to assist with the 2012 COS &RS update. The
survey amount will not exceed $27,000.
Resolution X Ordinance
Contract: X
Contract Term:
Insurance Required? No
Other
(specify)
Mail to: Karyn Johnson, FCS Group, 8201 164th Ave NE,
Suite 300 Redmond, WA 98052
Amount: $27,000 Expiration Date:
Funding Water Operating Fund 474 Phone: 425 - 867 -1802
Source:
APPROVED FOR
SUBMITTAL: City Manager
STAFF RECOMMENDATION:
Adopt resolution
BOARD /COMMISSION RECOMMENDATION:
ATTACHMENTS:
Click to download
❑ Resolution
❑ Contract
AGREEMENT FOR PROFESSIONAL SERVICES
ADDENDUM NO. 1
2012 DOMESTIC WATER SYSTEM RATE UPDATE
This Addendum to the 2012 Domestic Water System Rate Update, hereinafter identified as Addendum
No 1, is hereby entered into and made a part of the Agreement between City of Yakima, Washington,
and Financial Consulting Solutions Group, Inc., for Professional Services first entered into on the 16th
day of May, 2012, by the CITY OF YAKIMA, hereinafter called the "CITY," and FINANCIAL
CONSULTING SOLUTIONS GROUP, INC, hereinafter called the "FCS Group"
WITNESSETH: That in consideration of the mutual covenants and agreements herein contained, the
parties hereto do mutually agree to amend, revise, and /or add the following to the referenced Agreement:
SECTION 2 - SCOPE OF SERVICES
21 Basic Services. In addition to the duties se
CONSULTANT agrees to perform additional
Addendum No. 1 Exhibit A: Modify the 201
2012 Data.
SECTION 5 - COMPENSATION
t forth in the underlying agreement,
work tasks described in the attached
2 Domestic Water Rate Update using
51 COMPENSATION ON A TIME SPENT BASIS AT SPECIFIC HOURLY RATES. For the
services described in the attached Addendum No. 1 Exhibit A, compensation shall be
on a time spent plus expenses basis at the FCS Group's normal hourly billing rates
shown on Exhibit B, attached to this agreement, not to exceed $15,000 00 without
written agreement.
IN WITNESS WHEREOF the parties hereto duly enter into and execute this Addendum No 1, as of this
day of , < ✓I ( 2013
Other than specific amendments stated herein, all other terms, conditions and requirements of the
underlying contract shall remain in full force and effect throughout the term of the underlying contract.
CITY OF YAKIMA
c,
Sign re
Tony 'Rourke
Title City Manager
Date. 1040 13
Attest
Citv' Jerk
City Contract No
12 -46
Resolution No R- 2012 -066
Financial Consu
n John
Title Principal .. s
�6- t i
VIA
Page 1
utions Group, Inc.
ADDENDUM NO. 1
EXHIBIT A
CITY OF YAKIMA — 2012 DOMESTIC WATER SYSTEM RATE UPDATE
SCOPE OF WORK
During the term of this AGREEMENT, the ENGINEER shall perform professional services in connection
with the following project:
A scope of work is presented here to modify the 2012 DOMESTIC WATER SYSTEM RATE
UPDATE using 2012 data and to complete a utility benchmarking survey using the AWWA
criteria:
The initial project tasks developed the 2012 rate update report, rate recommendations and
revised the connection fee charges -
Task 1 — Domestic Water System Rate update (COMPLETE)
Task 2 — Domestic Water Connection Charge Revision (COMPLETE)
Task 3 — Benchmarking Survey (COMPLETE)
Task 4 — Modify the 2012 Rate Study (ADDRESSED HEREIN)
Detailed descriptions of the services are provided as follows:
Task 3 — Benchmarking Survey
Description: Perform a benchmarking survey using AWWA published criteria.
Subtasks:
• Identify relevant performance indicators including organizational, operational,
business /financial, and customer relations performance measures.
• Calculate formulaic results for Yakima water operations based on 2011
financial /operational information
• Summarize and score results in comparison to AWWA published survey results for
participating water utilities similar in size and geographic location.
• Submit report including identified areas of strength and areas for potential improvement.
• Review results with City staff.
Deliverables: Benchmarking Survey Report
Schedule: Delivered
Cost: $7,000
Page 2
Task 4 — Modify the 2012 Rate Study
Description: Modify the 2012 Domestic Water System Rate Update using 2012 historical data
and 2013 budget and revise the rate recommendations
Subtasks:
• Evaluate, validate, and summarize 2012 customer billing system data by customer class
and reconcile with actual revenue received.
• Update rate model to incorporate 2012 year -end financial data and 2013 budget.
• Update the capital funding strategy; revenue requirement analysis; rate adjustment
strategy and resulting cost of service rates for the five -year study period (2013- 2017).
• Update incremental utility tax calculation to address the Lane case.
• Update rate study report.
• Review results with City staff.
Deliverables Updated report including new rate recommendations.
Schedule: Completion by July 31, 2013
Cost: $8,000
Table 1. Budget Summary
Task
Budget
Task 1 — 2012 Domestic Water System Rate
Update
Complete
Task 2 — Connection Charge Update
Complete
Task 3 — Benchmarking
$7,000
Task 4 — Rate Study Update
$8,000
Total
$15,000
Page 3
EXHIBIT B
SCHEDULE OF RATES
See attached FCS GROUP 2013 Standard Fee Schedule, effective January 1, 2013
Page 4 of 4
FCS GROUP
2013 STANDARD FEE SCHEDULE
Effective January 1, 2013
LABOR I
POSITION /TITLE
BILLING RATE
President
Standard Rate
$250
Program Director (Karyn Johnson)
Standard Rate
$225
Principal
Standard Rate
$220
Senior Project Manager
Standard Rate
$195
Senior Special Projects Manager
Standard Rate
$185
Project Manager II
Standard Rate
$175
Project Manager I
Standard Rate
$165
Project Consultant
Standard Rate
$145
Senior Analyst (Krista Shirley)
Standard Rate
$120
Analyst
Standard Rate
$110
Administrative and Technical Support
Public Relations $120
Technical Writer /Graphic Artist $ 100
Administrative Support $ 75
DIRECT EXPENSES
Major direct expenses, such as travel, mileage, and lodging, will be charged at cost. Other expenses
will not be directly charged unless by mutual agreement of the client and FCS GROUP and specific
terms will be established in advance prior to expenditure and billing.
TECHNOLOGY CHARGE
FCS GROUP charges a $5 per hour technology charge to cover overhead for IT systems, computers,
communication devices and connectivity.
SUBCONSULTANTS
When applicable, subconsultants will be charged at invoiced cost plus 10 %.
' Litigation rates are 150% of standard hourly rates for services in support of litigation, settlement
negotiations, arbitration and /or mediation processes
.; GROUP www.fcsgroup.com