Agmt22 HF&H Consultants,LLC - Laserfiche WebLink

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REV: 08-25-2022 RL •Draft and final reports •Presentation at two community meetings •Presentation to City Council for Proposition 218 hearing •Recommended municipal code changes Task 2 - Water and Recycled Water Rate Study Any new water and recycled water rates shall be effective beginning July 2023. Task 2a. Kickoff Meeting Consultant shall facilitate an in-person kickoff meeting with City staff to introduce participants and identify their project roles and expectations. Meeting topics shall include discussions evaluating relevant fiscal policies and community interests, identifying current issues and concerns (financial and operational), discussing project scope, timing, and deliverables, and requesting and compiling all relevant and required data. Deliverables: Consultant shall provide: •A data request list ahead of the meeting for the purposes of discussion •Meeting notes Task 2b. Develop Revenue Requirement Consultant shall prepare a 10-year financial planning model projecting the operating and maintenance and capital expenses, operating and non-operating revenue, and reserve fund balances. Expenses will be based on the City’s budget and capital improvement program. Consultant shall prepare the financial plan as an Excel spreadsheet model to provide the City with a means to edit the model when annual budgets and capital expenditures change each year. Consultant shall develop the models to be as simple as possible and with input from the Public Works Director or their designee(s) to ensure that they meet the City’s needs. Models shall have no licensing restrictions. For specific elements: •Expenses: Consultant shall tailor expense calculations to reflect variations in staffing levels, salaries, operating expenses and other City requested inputs. Analysis shall include San Francisco Public Utilities Commission (SFPUC) cost to purchase water, taking into consideration SFPUC projected increases, recent drought conditions, reduced water allotment from SFPUC, and potable water use reduction and conservation goals identified in the City’s 2020 Urban Water Management Plan. Expenses shall also include debt service and software. •Revenues: Consultant shall calculate and project rate revenue based on the current rate structure and projected growth in units of service (e.g., hundred cubic feet (hcf), service connection size). •Reserves: Consultant shall integrate current reserve funds into the model and evaluate existing policies, as well as the need for adding, deleting, or redefining the funds. Consultant shall confirm the reserve level rules for modeling the rate increases, which will either reflect current policies or recommended policies. ATTY/AGR.2022.318/HF&H Consultants, LLC (Page 15 of 27)