2016-060 Ordinance - Laserfiche WebLink

Home Browse Search

Hazen April 8, 2016 Hazen and Sawyer 1755 Merriman Road, Suite 350 Akron, OH 44313 • 330.835.9585 City of North Olmsted Carrie Copfer, Director of Finance 5200 Dover Center Road North Olmsted, Ohio 44070 Re: Rate Analysis Update Proposal Dear Ms. Copfer: Thank you for the opportunity to submit a proposal for providing the City of North Olmsted an update of the Dynamic Rate Analysis Model pertaining to your wastewater treatment system. The proposed services will be conducted to evaluate the adequacy of the City's sewer rates taking into account sewer revenues, expenditures, previous and planned rate increases as well as current and future debt service. As you know, Hazen and Sawyer conducted a dynamic rate analysis model in 2010, as well as several updates to the model since its development based on the planned collection system and wastewater treatment plant capital improvement projects necessary to meet NPDES permit requirements. The last update to the rate model was completed in September of 2011. Subsequent to that update a review specifically to evaluate the effects of reduced interest rates for project funding coupled with the increase project costs for the WWTP improvements was conducted in October of 2012. The 2011 and 2012 updates were conducted utilizing previous usage data collected from the 2009 reporting year. Operational costs, projected increases in costs and revenue, as well as existing and projected debt service were updated in these models but actual usage information was from calendar year 2009. Since Phase 1 and 2 collection system improvements and the plant improvements are now completed, the actual debt service for these projects as well as the loan for the Phase 2 treatment plant improvements can accurately be projected. Based upon these items the model can be updated to evaluate the implemented rate increases to determine the long term impact and if any adjustments in rates are needed. In addition, it is recommended that updated water usage information be obtained in order to accurately identify the current usage and projected revenue. While obtaining and inputting this data into the model adds time and cost, it will improve the accuracy of forecasting the future financial picture. In addition, as you have requested, we will also evaluate going from a quarterly billing cycle to a monthly billing cycle and determine the necessary monthly rates that will be required to maintain adequate revenue. Based on our discussions, we have outlined the proposed terms for these services as follows: Project Team: Our Project Team will be led by Mr. Scott Ankrom. The majority of assistance for this task will be by Mr. Ankrom in conjunction with Ms. Sharon Richardson and Ms. Corinne Sackett. Any delegation of tasks from Mr. Ankrom to other staff would be discussed with the City prior to execution. hazenandsawyer.com