Utilities Rate, Financial Planning, and Organizational Services

The vendor is required to provide comprehensive utilities rate, financial planning, and organizational services.
- assist the city in evaluating and developing utility rates, financial planning, and organizational strategies to ensure the sustainability and efficiency of the city's utility services. 
- The services will include, but are not limited to, rate studies, financial forecasting, cost-of-service analysis, and organizational assessments.
- Revenue sufficiency analysis
•    Development of a five and ten-year revenue requirement and rate projection model, with interim projections out to a fifteen and twenty-year planning horizon
•    Forecasting of operating expenses, capital funding needs, cost recovery, and reserve requirements
•    Evaluation of capital financing strategies, including debt issuance versus pay-as-you-go funding
•    Scenario modeling to assess key variables, including:
•    Capital replacement plan (CRP)
•    Capital improvement plan (CIP) timing and prioritization alternatives
•    Regulatory compliance cost impacts
•    Debt issuance timing, structure, and affordability
•    Identification of required rate adjustments to maintain financial sustainability and policy compliance
•    Integration of financial policies, including reserve targets and debt service coverage requirements
•    Sensitivity analysis to evaluate risks related to demand fluctuations, inflation, and growth assumptions
•    Semi-annual updates to the financial projection model during the study period.
•    Review and update assumptions at least annually to align with evolving priorities, including capital improvement needs, regulatory requirements, and system demand
- Financial policy development
•    Debt service coverage ratio targets
•    Reserve policies (operating, debt, renewal & replacement, and emergency)
•    Allocation and differentiation policies for contributions to the city’s general fund, utilities operating, capital, and reserve funds.
•    Minimum and target working capital/cash balances
•    Capital financing strategy (debt, pay-go, grants, SRF, WIFIA, federal/state funding)
•    Implement a capital improvement surcharge with restricted-use proceeds dedicated to capital planning for aging assets located outside the city boundaries.
•    Prepare financial feasibility reports in support of the issuance of revenue bonds or securing debt financing for capital or major operational programs, including preparing for and attending presentations before rating agencies, bond insurance companies, potential investors and purchasers of instruments of debt, and other required parties.
•    Advice (financial, not legal) the city in the preparation of loan documents to obtain funding from agencies such as the department, banks, and other lending agencies.
•    Best-practice alignment with peer utilities and industry standards
•    Perform benchmarking analysis, reserve levels, and financial policy benchmarks
- Rate structure analysis
•    Review of existing customer class usage and provide recommendations based on state rate, including consumption pattern analysis
•    Evaluation of fixed vs. Volumetric revenue balance
•    Review of tier structures and inclining block methodology, taking conservation into consideration
•    Evaluate and make recommendations on an approach for cost allocation for surcharge cost levied on boundary municipalities for capital improvement expenses attributable solely to their systems
•    Review and analyze the annual sea-by-the-sea true-up calculations and provide recommendations to ensure full cost recovery for current operations and future capital improvements.
•    Advice on large user or pass-through agreements and service contracts, e.g., county wastewater agreement, lighthouse point reuse agreement, to ensure full cost recovery for current operations and future capital improvements. Services may include drafting agreements, reviewing documents, negotiating among affected parties, and performing financial or economic analyses required for evaluation.
•    GIS integration for parcel, customer class, and service area alignment
•    Revenue elasticity modeling
•    Affordability analysis, including evaluation of customer assistance options
•    Address growth and projected demands for both water and sewer into the rate structure
- Utility billing and data review
•    Review utility billing data and revenue records for accuracy and consistency
•    Develop familiarity with the city’s utility billing system and financial systems
•    Perform revenue reconciliation and consumption validation analyses
•    Identify data limitations and recommend improvements where appropriate
- Development services process
•    Workflow process for assessment, including application intake, fee collection, plan review, permitting, inspections, meter installation, and final acceptance.
•    Provide a standardized developer agreement template, including roles and responsibilities, construction requirements, asset transfer, and acceptance procedures.
•    Assess and recommend updates to development-related fees (e.g., cost recovery fees, capacity charges, connection fees) to ensure alignment with actual service costs and equitable cost allocation.
•    Ensure fees and policies support capital improvement needs and appropriate funding of growth-related infrastructure.
•    Recommend standardized procedures for fee collection, permitting, inspections, testing, and transfer of assets, including documentation and system integration.
•    Documentation & implementation: prepare clear documentation of recommended fees, policies, and procedures, and ordinance updates to support implementation.