Submitted By: Rusella Bowes-Johnson
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Presentation By: Sean Lanier
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Department: Water & Sewer
STAFF RECOMMENDATION (Motion Ready):
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Approve the award of a piggyback agreement to Raftelis Financial Consultants, Inc., for the provision of a water, sewer, reclaimed water, and miscellaneous fees rate study for an estimated cost of $104,900
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OCALA’S RELEVANT STRATEGIC GOALS:
Fiscally Sustainable, Operational Excellence
PROOF OF PUBLICATION:
N/A
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BACKGROUND:
Raftelis Financial Consultants, Inc. (“Raftelis”) is a financial and management consulting firm that provides independent evaluations for enterprise systems. Raftelis has agreed to provide rate and financial consulting services related to the preparation of a rate and system development fee study of the City’s water, sewer, and reclaimed water fees. They will evaluate the adequacy of monthly water, sewer, and reclaimed rates, impact fees, and other miscellaneous charges. The rate study will also include an update to the financial forecast to determine sufficient revenue needed to support system operations and maintenance, and identify funding to pay for capital expenditures for system repairs, upgrades, and expansions.
The City’s last water and wastewater rate study was conducted in 2020. The current water and sewer usage rates and charges have been in effect since February 1, 2021, covering Fiscal Year 2021 - 2025.
FINDINGS AND CONCLUSIONS:
After a competitive solicitation process, Charlotte County, Florida, awarded Contract No. 2023000004 (the “Charlotte County Agreement”) to Raftelis Financial Consultants, Inc. for the provision of utility rate and system development fee study services. The Charlotte County Agreement offers an initial term of five years and seven months, commencing February 28, 2023, and ending September 30, 2028. There are also two (2) optional one-year renewal terms available upon mutual agreement of the parties.
On October 31, 2023, after evaluation of the Charlotte County Agreement, Procurement and Contracting Department staff granted Water Resources Department’s request for a procurement exception to piggyback the Charlotte County Agreement for preparation of the City’s rate and system development fee study. Raftelis has agreed to extend to the City of Ocala the same highly competitive pricing yielded from Charlotte County’s competitive solicitation process, which maximizes best value to the City.
The deliverables to be provided under this engagement include the following items:
• Water, sewer, reclaimed water and miscellaneous fees utility rate and financial feasibility study;
• Water, sewer and reclaimed water connection fee study;
• Analysis of existing and proposed water supply agreements, interlocal agreements and amendments;
• Educational presentations of utility information to City personnel and City Council;
• Analysis of financial data related to the acquisition, expansion or disposal of any water/sewer/reclaimed water within the utility service area;
• Requests for updated analyses or additional financial or cost of service scenarios after substantial completion of the initial work or on proposed projects;
• Information and analysis required relating to debt issuance and bond coverage, and service of senior debt;
• Comparisons of current and projected water and sewer costs (operational, capital improvement, bonded debt) against appropriate industry benchmarks;
• Analysis of impact to all rates based on future expansions of service;
• Assistance with State Revolving Fund (SRF), US Department of Agriculture (USDA) loans or grant funding applications and repayment options;
• Assistance with establishing, operating or realigning various fund accounts in order to streamline accounting with renewal and replacement (R&R) programs, capital improvement programs (CIP), and such;
• The delivery of non-proprietary multi-scenario modeling software as a deliverable at a milestone to be determined; and
• General assistance with other methods of charging various fees and charges, evaluation of funding scenarios, and other related needs.
After the issuance of the City’s Notice, Raftelis will complete the evaluation of utility rates and system development fees within 180 days. The completion of the study is subject to the City’s provision and availability of information that is necessary in order for Raftelis to conduct the evaluations.
Staff recommends approval.
FISCAL IMPACT:
Account number 455-030-030-536-53-31010 has funds available in the amount of $104,900 in the FY 2024 budget to conduct this rate study.
PROCUREMENT REVIEW:
These services were procured in compliance with the City’s Procurement Policy.
LEGAL REVIEW:
This Agreement will be reviewed and approved for form and legality by City Attorney, William E. Sexton.
ALTERNATIVE:
• Approve with Changes
• Table
• Deny