Agenda

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13.

Work Session and Regular Meeting

Meeting Date:	06/12/2018
Department:	Finance
Pillars:	Gold Standard in Customer Service Gold Standard in Financial Health
Milestones:	Leverage Addison's unique assets to grow and expand placemeaking and events that will set Addison apart and attract talent and businesses Continue development and implementation of Long Term Financial Plan Prepare for the impact of new growth and development in Addison

AGENDA CAPTION:

Consider Action to Approve a Resolution for an Amendment to the Financial Plan and Rate Model Contract for Water and Sewer Utility Rates for the Town's Use with Raftelis Financial Consultants, Inc. (RFC) in an Amount not to Exceed $6,960.

BACKGROUND:

During the preparation of the Utility Fund budget for Fiscal Year (FY) 2018, it was determined that the Town's projected water and sewer fees would not raise enough revenues to cover the budgeted expenditures necessary to maintain the current level of service.

To rectify this issue, in FY2017 the Town hired a utility rate consultant, Raftelis Financial Consultants, Inc. (RFC), to review the current rate structure and to assist the Town in creating a new rate model that would allow us to achieve our goals (infrastructure funding, staffing, etc.) and sustainably maintain the desired level of service. Fortunately, the Utility Fund remains strong and the Town is in a position to proactively plan for the future.

After the initial analysis had been completed, it became evident that staff could provide additional data regarding future staffing and economic growth for Raftelis to conduct an analysis of the utility system costs and needs. This analysis is outside the original scope of work included in the contract signed by City Manager in July 2017 in the amount of $49,570.

The total amendment costs for the above work includes 32 hours of consultant time for a cost not to exceed of $6,960. At this time, staff is asking Council to ratify the original contract and approve this amendment for a total revised contract amount of $56,530.

Although this amendment is within the 25% change allowed by Texas State procurement law, the Ordinance dated March 8, 2016 giving city manager signature authority over contracts that do not exceed $50,000 does not allow for a 25% variance. The Ordinance states the amount of the amendment including the original contract amount together cannot exceed $50,000.

RECOMMENDATION:

Administration recommends approval.

Attachments
Resolution - Raftelis Utility Rate Analysis Contract Amendment