Submitted By: Marie Brooks
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Presentation By: Doug Peebles
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Department: Electric Utility
STAFF RECOMMENDATION (Motion Ready):
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Adopt Resolution 2024-10 to amend the Electric Rates - Schedule A, under section 70-641, City Code of Ordinances, to be effective March 1, 2024
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OCALA'S RELEVANT STRATEGIC GOALS:
Fiscally Sustainable, Operational Excellence
PROOF OF PUBLICATION:
N/A
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BACKGROUND:
The City of Ocala Electric Utility (Electric) customer base rates have been in effect since October 1, 2020. Electric retained the services of an independent rate consultant, Leidos, Inc. to evaluate the utility's financial feasibility through a comprehensive rate study. The study developed a financial forecast to determine sufficient revenue requirements to support system-wide operations, maintenance, and capital improvement needs. The Utility Advisory Board (the Board) was provided updates from Leidos during meetings on September 27, 2023, and November 29, 2023.
FINDINGS AND CONCLUSIONS:
Leidos assessed revenue adequacy and identified the need to modify electric customer rates in response to inflationary pressures, including heightened operational costs, supply chain challenges, requirements for ongoing maintenance, capital improvements, and the preservation of service reliability.
On January 24, 2024, Leidos presented the Rate Study findings to the Board with the recommendation for a rate adjustment to support the revenue requirements of the Electric Utility system. The Board members unanimously recommended approval of the rate adjustments presented and as attached to this agenda item.
FISCAL IMPACT:
Existing electric customer rates are insufficient to fund bulk power purchases, ongoing operations, maintenance, and capital improvement costs for the system. The proposed rate adjustment is forecasted to support those needs through fiscal year 2028.
PROCUREMENT REVIEW:
N/A
LEGAL REVIEW:
N/A
ALTERNATIVE:
* Approve with amendments...
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