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HomeMy WebLinkAbout120-85 RESOLUTIONftr 12 SCANNED RESOLUTION NO. 120-85 A RESOLUTION AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT WITH BLACK & VEATCH FOR THE PERFORMANCE OF A COMPREHENSIVE WATER RATE STUDY. BE IT RESOLVED BY TBE BOARD OF DIRE IDRS OF Tf3E CITY OF FAYETTEVILLE, ARKANSAS: That the Mayor and City Clerk are hereby authorized and directed to execute a contract with Black & Veatch for the performance of a comprehensive water rate study. A copy of the contract authorized for execution hereby is attached hereto marked Exhibit "A" and made a part hereof. PASSED AND APPROVED this 19th day of November APPROVED By: � Mayo,69r • , 1985. CONTRACT FOR ENGINEERING SERVICES THIS CONTRACT is made by and between the City of Fayetteville, Arkansas, hereinafter called the City, and Black & Veatch Engineers -Architects of Kansas City, Missouri, hereinafter called the Engineers. WITNESSETH: That in consideration of the mutual covenants herein contained, the City hereby agrees to employ the Engineers to perform the services here- inafter outlined in connection with development of revenue and revenue requirements, allocation of costs of service, and rate design for the water utility. SECTION I. The services the Engineers agree to perform are as set forth in Attachment A. SECTION II. For the services set forth in Section I, the City agrees to pay the Engineers on the following basis: Project Manager, Project Engineer, 2.6 times Direct Salary Cost and all other engineers, technical and clerical personnel. All direct expense, including in Out-of-pocket cost. part, travel and subsistence away from the Engineers' Office, computer time, long distance telephone, and reproduction. Engineers will render itemized monthly statements to the City for work per- formed and costs incurred during the preceding month. EXHIBIT 7A The total amount of this contract is $38,500 and the City shall not be liable for total fees under this contract in excess of that amount unless additional sums are authorized by the City. SECTION III. It is mutually understood and agreed that the City shall pro- vide the following data and perform the following services at its own • expense: 1. Copies of all maps, plans, records, statistical and financial data, annual audits, annual budgets, reports by others, explanations, sales records, or other data as may be avail- able. 2. Schedules of major improvements of the water system antici- pated during the study period. The major improvements schedule will include estimated construction costs. 3. Ordinances, statements of policy, and statements of adminis- trative procedures which together formulate the present basis of providing, operating, and financing the utilities. 4. Policy direction on such matters as the City considers appro- priate, and expeditious review of preliminary findings and draft reports. 5. Tabulation of water bills for a recent twelve month period by customer class. Direction for the preparation of the bill tabulation will be provided by Black & Veatch. SECTION IV. It is also mutually understood and agreed: 1. Any additional work requested by the City which is not spe- cifically covered in the scope of services as defined under Section I, such as additional financing alternatives, addi- tional meetings, assistance with bond sales, and similar services, will be performed by the Engineers at a reasonable fee or compensation to be agreed upon between the City and the Engineers at the time any such services may be required. 2. The Engineers shall not be liable for delays resulting from causes beyond the reasonable control of the Engineers; that the Engineers have made no warranties, expressed or implied, which are not expressly set forth in this contract; and that under no circumstances will the Engineer be liable for indirect or consequential damages. 2 • • 3. If the City's responsibilities are kept in a timely and expe- ditious manner, the preliminary reports as referred to in Attachment A can be furnished by the Engineers within 3 months following receipt from the City of notice to proceed. 4. Final reports will be delivered to the City within 15 working days following the Engineers' receipt of the City's comments pertaining to their review of the preliminary reports, assum- ing no major revisions to the study are required as a result of the City's review. 5. The -Engineer will indemnify, defend, and save harmless the City from any and all losses or claims from injuries or death to persons or damage to property and from any suit or judge- ment or other thing whatsoever that may occur in the per- formance of this contract resulting from any negligent act, error, or omission of the Engineer. IN WITNESS WHEREOF, the parties hereto have executed this contract in dupli- cate this /7 " `day of � 1985. CITY OF FAYETT_ ILLE By Title BLACK & VEATCH GINE RS -ARCHITECTS By v/ Title Project Manager �• �U J. R. Brown 3 ATTACHMENT A SCOPE OF SERVICES ENGINEER'S SERVICES. The Engineer shall render the City the following pro- fessional services in connection with the project: DATA COLLECTION Meet with staff representatives to discuss key project objectives, collect data pertinent to the study and initiate the preparation of a bill tabula- tion. Prior to the meeting, the City will be furnished a list of typical data and information items required to complete the water rate study. REVENUE AND REVENUE REQUIREMENTS Analyze service area growth and water use, taking into account climatic and other local conditions. Project future customers served, water sales volumes, and revenues which may be reasonably expected for a 5 year study period based on past records of numbers and types of customers served, his- torical water use by customer class, and revenues received under existing rates. Determine the degree to which historical water sales and revenues have been abnormally high or low so that future projections may reflect normal conditions. Project future operating costs recognizing increases in the number of custo- mers served, water requirements, and the effects of continuing inflation on cost levels. Project debt service requirements for principal and interest payments on existing and any proposed bond issues, and project the cost of routine annual capital expenditures, and any other requirements for revenue. Prepare a projected cash flow for the study period utilizing projected revenue requirements and projected revenue under existing rates. Identify any revenue deficiencies, show the timing and magnitude of required revenue increases, and determine the optimum combination of cash and debt financing required to meet total revenue requirements. A maximum of three alternative financing plans will be prepared under this scope of services. COST OF SERVICE ANALYSIS Allocation total requirements for revenue, or cost of service, for the selected financing plan to functional cost components of volume, peak demands and customer elements to provide a basis for determining the unit costs of service. Estimate the relative responsibility of "each customer class for system capacity, total volumes required, and customer elements based upon local experience and conditions. Customer classes may include residential, com- mercial, industrial, municipal, wholesale service, public fire protection, and any other appropriate service group. 1 Distribute the functional costs of service to the various customer classifi- cations on the basis of estimated service requirements for each class. Compare revenues expected from each customer class under the existing rate schedule with the distributed functional cost of service to determine the adjustment in revenues for each classification required to reasonably dis- tribute total cost of service to customers served. RATE DESIGN Design a schedule of water rates to recover revenues from customer classes generally in accordance with costs of service. The practical aspects of historical practice and the City's policy will be recognized in the recom- mended rate adjustments. Prepare a schedule of typical bills under proposed rates for selected meter sizes and water sales in each class of customers to illustrate the impact of the proposed rates. REPORT AND MEETINGS 1. Meet with City staff at the outset of the study to identify major items of interest and concern, and to obtain financial and statistical data compiled by the City from an information request to be furnished by the Consultant. 2. Meet with City staff at the conclusion of the revenue requirements portion of the study to review revenue and expense projections and discuss alternative financing plans. 3. Prepare a draft report incorporating the findings, conclusions and recommendations of the study and meet with City staff, Board of Directors, and other interested parties to discuss the draft report. 4. Prepare a final report incorporating the comments provided by City representatives on the draft report. Twenty-five (25) copies of the final report will be provided to the City. 5. Meet with the Board of Directors to present the final report. 6. The estimated cost for the proposed study includes allowance for one additional meeting with City staff, Board of Directors, or other inter- ested parties to discuss study findings and recommendations. 2 4 RESOLUTION NO. 120-85 A RESOLUTION AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT WITH BLACK & VEATCH FOR THE PERFORMANCE OF A COMPREHENSIVE WATER RATE STUDY. BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF FAYEITEVILLE, ARRANSAS: That the Mayor and City Clerk are hereby authorized and directed to execute a contract with Black & Veatch for the performance of a comprehensive water rate study. A copy of the contract authorized for execution hereby is attached hereto marked Exhibit "A" and made a part hereof. PASSED AND APPROVED this I9th day of APPROVED November.. By ��9 Mayor • , 1985. 6. CONTRACT FOR ENGINEERING SERVICES THIS CONTRACT is made by and between the City of Fayetteville, Arkansas, hereinafter called the City, and Black & Veatch Engineers -Architects of Kansas City, Missouri, hereinafter called the Engineers. WITNESSETH: That in consideration of the mutual covenants herein contained, the City hereby agrees to employ the Engineers to perform the services here- inafter outlined in connection with development of revenue and revenue requirements,allocation of costs of service, and rate design for the water utility. SECTION I. The services the Engineers agree to perform are as set forth in Attachment A. SECTION II. For the services set forth in Section I, the City agrees to pay the Engineers on the following basis: Project Manager, Project Engineer, and all other engineers, technical and clerical personnel. All direct expense, including in part, travel and subsistence away from the Engineers' Office, computer time, long distance telephone, and reproduction. 2.6 times Direct Salary Cost Out-of-pocket cost. Engineers will render itemized monthly statements to the City for work per- formed and costs incurred during the preceding month. EXHIBIT lA • The total amount of this contract is $38,500 and the City shall not be liable for total fees under this contract additional sums are authorized by the City. in excess of that amount unless SECTION III. It is mutually understood and agreed that the City shall pro- vide the following data and perform the following services at its own expense: 1. Copies of all data, annual explanations, able. maps, plans, records, statistical and financial audits, annual budgets, reports by others, sales records, or other data as may be avail - 2. Schedules of major improvements of the water system antici- pated during the study period. The major improvements schedule will include estimated construction costs. 3. Ordinances, statements of policy, and statements of adminis- trative procedures which together formulate the present basis of providing, operating, and financing the utilities. 5. Policy direction on such matters as the City considers appro- priate, and expeditious review of preliminary findings and draft reports. Tabulation of water bills for a recent twelve month period by customer class. Direction for the preparation of the bill tabulation will be provided by Black & Veatch. SECTION IV. It is also mutually understood and agreed: 1. Any additional work requested by the City which is not spe- cifically covered in the scope of services as defined under Section I, such as additional financing alternatives, addi- tional meetings, assistance with bond sales, and similar services, will be performed by the Engineers at a reasonable fee or compensation to be agreed upon between the City and the Engineers at the time any such services may be required. 2. The Engineers shall not be liable for delays resulting from causes beyond the reasonable control of the Engineers; that the Engineers have made no warranties, expressed or implied, which are not expressly set forth in this contract; and that under no circumstances will the Engineer be liable for indirect or consequential damages. 3. If the City's responsibilities are kept in a timely and expe- ditious manner, the preliminary reports as referred to in Attachment A can be furnished by the Engineers within 3 months following receipt from the City of notice to proceed. 4. Final reports will be delivered to the City within 15 working days following the Engineers' receipt of the City's comments pertaining to their review of the preliminary reports, assum- ing no major revisions to the study are required as a result of the City's review. 5. The -Engineer will indemnify, defend, and save harmless the City from any and all losses or claims from injuries or death to persons or damage to property and from any suit or judge- ment or other thing whatsoever that may occur in the per- formance of this contract resulting from any negligent act, error, or omission of the Engineer. IN WITNESS WHEREOF, the parties hereto have executed this contract in dupli- cate this /9' `day of�/yyyj 1985. CITY OF FAYETT ILLE/ (72 By ��,AL/ Title BLACK & VEATCH RS -ARCHITECTS BY ,LtL.K J. R. Brown Title Project Manager 3 • ATTACHMENT A SCOPE OF SERVICES ENGINEER'S SERVICES. The Engineer shall render the City the following pro- fessional services in connection with the project: DATA COLLECTION Meet with staff representatives to discuss key project objectives, collect data pertinent to the study and initiate the preparation of a bill tabula- tion. Prior to the meeting, the City will be furnished a list of typical data and information items required to complete the water rate study. REVENUE AND REVENUE REQUIREMENTS Analyze service area growth and water use, taking into account climatic and other local conditions. Project future customers served, water sales volumes, and revenues which may be reasonably expected for a 5 year study period based on past records of numbers and types of customers served, his- torical water use by customer class, and revenues received under existing rates. Determine the degree to which historical water sales and revenues have been abnormally high or low so that future projections may reflect normal conditions. Project future operating costs recognizing increases in the number of custo- mers served, water requirements, and the effects of continuing inflation on cost levels. Project debt service requirements for principal and interest payments on existing and any proposed bond issues, and project the cost of routine annual capital expenditures, and any other requirements for revenue. Prepare a projected cash flow for the study period utilizing projected revenue requirements and projected revenue under existing rates. Identify any revenue deficiencies, show the timing and magnitude of required revenue increases, and determine the optimum combination of cash and debt financing required to meettotal revenue requirements. A maximum of three alternative financing plans will be prepared under this scope of services. COST OF SERVICE ANALYSIS Allocation total requirements for revenue, or cost of service, for the selected financing plan to functional cost components of volume, peak demands and customer elements to provide a basis for determining the unit costs of service. Estimate the relative responsibility of "each customer class for system capacity, total volumes required, and customer elements based upon local experience and conditions. Customer classes may include residential, com- mercial, industrial, municipal, wholesale service, public fire protection, and any other appropriate service group. Distribute the functional costs of service to the various customer classifi- cations on the basis of estimated service requirements for each class. Compare revenues expected from each customer class under the existing rate schedule with the distributed functional cost of service to determine the adjustment in revenues for each classification required to reasonably dis- tribute total cost of service to customers served. RATE DESIGN • Design a schedule of water rates to recover revenues from customer classes generally in accordance with costs of service. The practical aspects of historical practice and the City's policy will be recognized in the recom- mended rate adjustments. Prepare a schedule of typical bills under proposed rates for selected meter sizes and water sales in each class of customers to illustrate the impact of the proposed rates. REPORT AND MEETINGS 1. Meet with City staff at the outset of the study to identify major items of interest and concern, and to obtain financial and statistical data compiled by the City from an information request to be furnished by the Consultant. Meet with City staff at the conclusion of the revenue requirements portion of the study to review revenue and expense projections and discuss alternative financing plans. 3. Prepare a draft report incorporating the findings, conclusions and recommendations of the study and meet with City staff, Board of Directors, and other interested parties to discuss the draft report. 4. Prepare a final report incorporating the comments provided by City representatives on the draft report. Twenty-five (25) copies of the final report will be provided to the City. 5. Meet with the Board of Directors to present the final report. 6. The estimated cost for the proposed study includes allowance for one additional meeting with City staff, Board of Directors, or other inter- ested parties to discuss study findings and recommendations. 2