HomeMy WebLinkAboutAGMT - Willdan Financial Services 1 •
AN AGREEMENT
FOR WATER RATE STUDY
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SEAL'B
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City of Seal Beach
211 - 8th Street
Seal Beach, CA 90740 •
Willdan Financial Services
27368 Via Industria, Suite 110
Temecula CA 92590
THIS AGREEMENT is made and entered into this 13th day of October 2008, by and
between the City of Seal Beach, a municipal corporation ( "City ") and Willdan Financial
Services ( "Consultant ").
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RECITALS
A. City desires to conduct a water rate study for the City of Seal Beach Water Utility
(the "Project "), which Project requires the engagement of a Professional Consulting/Engineering
firm.
B. Pursuant to the authority provided by its City Charter and Government Code
Section 37103, if applicable, City desires to engage Consultant to provide a Water Rate Study in
the manner set forth herein and more fully described in Section 1.
C. Consultant represents that the principal members of Consultant firm are qualified
professional consulting/engineering firm and are fully qualified to perform the Consultant
services contemplated by this Agreement in a good and professional manner; and it desires to
perform such services as provided herein.
NOW, THEREFORE, in consideration of performance by the parties of the mutual
promises, covenants, and conditions herein contained, the parties hereto agree as follows:
AGREEMENT
1. Consultant's Services.
1.1. Scope and Level of Services. Subject to the terms and conditions set forth
in this Agreement, City hereby engages Consultant to perform the Water Rate Study ( "Services ")
set forth in Exhibit A, which is hereby incorporated by this reference. Such services shall
include, without limitation:
1.1.1. Project Meetings
1.1.2. Feasibility Analysis Related to Water Budget Based Rate Structure
1.1.3. Data Analysis, Financial Planning and Revenue Requirement
Analysis
1.1.4. Utility Rate Model Design
1.1.5. Preparation of Draft Comprehensive Utility Rate Analysis Report
1.1.6. Review, Revise and Present Comprehensive Report & Findings
1.1.7. Proposition 218 Strategy Development and Community Education
Effort
1.1.8. Final Water Rate Study Report
1.2. Time for Performance. Consultant shall perform all services under this
Agreement according to the project schedule set forth in the Project Schedule submitted as a part
of Exhibit A.
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1.3. Standard of Care. As a material inducement to City to enter into this
Agreement, Consultant hereby represents that it has the experience necessary to undertake the
services to be provided. In light of such status and experience, Consultant hereby covenants that
it shall follow the customary professional standards in performing all services.
1.4. Familiarity with Services. By executing this Agreement, Consultant
represents that, to the extent required by the standard of practice, Consultant (a) has investigated
and considered the scope of services to be performed, (b) has carefully considered how the
services should be performed, and (c) understands the facilities, difficulties and restrictions
attending performance of the services under this Agreement. Consultant represents that
Consultant, to the extent required by the standard of practice, has investigated the project and is
reasonably acquainted with the requirements thereof. Should Consultant discover any latent or
unknown conditions, which will materially affect the performance of services, Consultant shall
immediately inform City of such fact and shall not proceed except at Consultant's risk until
written instructions are received from the City Representative.
2. Term of Agreement. This Agreement is effective as of October 13, 2008 (the
"Effective Date "), and shall remain in full force and effect until Consultant has rendered the
services required by this Agreement, unless sooner terminated as provided in Section 13 herein.
3. Compensation and Expense Reimbursement.
3.1. Compensation. City shall compensate Consultant in accordance with
Exhibit C for the services provided pursuant to Section 1 of this Agreement. In no event shall
the City pay Consultant more than the total sum of $42,800.00 unless additional services are
provided pursuant to Section 3.2. City shall not withhold any federal, state or other taxes, or
other deductions.
3.2. Additional Services. City shall not pay Consultant for additional services
unless the City Representative authorizes, in advance, such services. City shall compensate
Consultant for any authorized extra services at the hourly rates set forth in Exhibit B.
4. Representatives.
4.1. City Representative. For the purposes of this Agreement, the contract
administrator and City's representative shall be the Director of Public Works, or such other
person as the Director designates in writing (hereinafter the "City Representative "). It shall be
Consultant's responsibility to assure that the City Representative is kept informed of the progress
of the performance of the services, and Consultant shall refer any decisions that must be made by
City to the City Representative. Unless otherwise specified herein, any approval of City required
hereunder shall mean the approval of the City Representative.
4.2. Consultant Representative. For the purposes of this Agreement, Brian
Jewett is hereby designated as the principal and representative of Consultant authorized to act in
its behalf with respect to the services specified herein and make all decisions in connection
therewith (the "Responsible Principal "). It is expressly understood that the experience,
knowledge, capability, and reputation of the Responsible Principal were a substantial inducement
for City to enter into this Agreement. Therefore, the Responsible Principal shall be responsible
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during the term of this Agreement for directing all activities of Consultant and devoting
sufficient time to personally supervise the services hereunder. Consultant may not change the
Responsible Principal without the prior written approval of City, which approval shall not be
unreasonably withheld.
5. Consultant's Personnel.
5.1. All Services shall be performed by Consultant or under Consultant's direct •
supervision, and all personnel shall possess the qualifications, permits, and licenses required by
State and local law to perform such Services, including, without limitation, a City of Seal Beach
business license as required by the Seal Beach Municipal Code. Consultant personnel shall be
those designated on Exhibit C.
5.2. Consultant shall be solely responsible for the satisfactory work
performance of all personnel engaged in performing the Services and compliance with the
standard of care set forth in Section 6 below.
5.3. Consultant shall be responsible for payment of all employees' and
subconsultants' wages and benefits, and shall comply with all requirements pertaining to
employer's liability, workers' compensation, unemployment insurance, and Social Security.
5.4. Consultant shall indemnify and hold harmless City and its elected
officials, officers and employees, servants, designated volunteers, and agents serving as
independent contractors in the role of city or agency officials, from any and all liability,
damages, claims, costs and expenses of any nature to the extent arising from Consultant's alleged
violations of personnel practices. City shall have the right to offset against the amount of any
fees due to Consultant under this Agreement any amount due to City from Consultant as a result
of Consultant's failure to promptly pay to City any reimbursement or indemnification arising
under this Section 5.
6. Standard of Performance. Consultant shall perform all services to customary
professional standards and in a manner reasonably satisfactory to City.
7. Status as Independent Contractor. Consultant is, and shall at all times remain as
to City, a wholly independent contractor. Consultant shall have no power to incur any debt,
obligation, or liability on behalf of City or otherwise act as an agent of City. Neither City nor
any of its agents shall have control over the conduct of Consultant or any of Consultant's
employees, except as set forth in this Agreement. Consultant shall not, at any time, or in any
manner, represent that it or any of its officers, agents or employees are in any manner employees
of City. Consultant shall pay all required taxes on amounts paid to Consultant under this
Agreement, and to indemnify and hold City harmless from any and all taxes, assessments,
penalties, and interest asserted against City by reason of the independent contractor relationship
created by this Agreement. Consultant shall fully comply with the workers' compensation law
regarding Consultant and Consultant's employees. Consultant further agrees to indemnify and
hold City harmless from any failure of Consultant to comply with applicable workers'
compensation laws. City shall have the right to offset against the amount of any fees due to
Consultant under this Agreement any amount due to City from Consultant as a result of
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Consultant's failure to promptly pay to City any reimbursement or indemnification arising under
this Section 7.
8. Confidentiality. Consultant may have access to financial, accounting, statistical,
and personnel data of individuals and City employees. Consultant covenants that all data,
documents, discussion, or other information developed or received by Consultant or provided for
performance of this Agreement are deemed confidential and shall not be disclosed by Consultant
without prior written authorization by City. City shall grant such authorization if applicable law
requires disclosure. All City data shall be returned to City upon the termination of this
Agreement. Consultant's covenant under this section shall survive the termination of this
Agreement.
9. Conflict of Interest.
9.1.1. Consultant covenants that it presently has no interest and shall not
acquire any interest, direct or indirect, which may be affected by the Services, or which would
conflict in any manner with the performance of the Services. Consultant further covenants that,
in performance of this Agreement, no person having any such interest shall be employed by it.
Furthermore, Consultant shall avoid the appearance of having any interest, which would conflict
in any manner with the performance of the Services. Consultant shall not accept any
employment or representation during the term of this Agreement which is or may likely make
Consultant "fmancially interested" (as provided in Califomia Government Code § §1090 and
87100) in any decision made by City on any matter in connection with which Consultant has
been retained.
9.1.2. Consultant further represents that it has not employed or retained
any person or entity, other than a bona fide employee working exclusively for Consultant, to
solicit or obtain this Agreement. Nor has Consultant paid or agreed to pay any person or entity,
other than a bona fide employee working exclusively for Consultant, any fee, commission, gift,
percentage, or any other consideration contingent upon the execution of this Agreement. Upon
any breach or violation of this warranty, City shall have the right, at its sole and absolute
discretion, to terminate this Agreement without further liability, or to deduct from any sums
payable to Consultant hereunder the full amount or value of any such fee, commission,
percentage or gift.
9.1.3. Consultant has no knowledge that any officer or employee of City
has any interest, whether contractual, noncontractual, financial, proprietary, or otherwise, in this
transaction or in the business of Consultant, and that if any such interest comes to the knowledge
of Consultant at any time during the term of this Agreement, Consultant shall immediately make
a complete, written disclosure of such interest to City, even if such interest would not be deemed
a prohibited "conflict of interest" under applicable laws as described in this subsection.
10. Indemnification.
10.1. Indemnity for Design Professional Services. In connection with its design
professional services, Consultant shall defend, hold harmless and indemnify City, and its elected
officials, officers, employees, servants, designated volunteers, and those City agents serving as
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independent contractors in the role of city or agency officials (collectively, "Indemnitees "), with
respect to any and all claims, demands, damages, liabilities, losses, costs or expenses
(collectively, "Claims" hereinafter), including but not limited to Claims relating to death or
injury to any person and injury to any property, to the extent to which they arise out of, pertain
to, or relate to the negligence, recklessness, or willful misconduct of Consultant or any of its
officers, employees, subcontractors, or agents in the performance of its design professional
services under this Agreement, but not to the extent the result of the negligence or willful
misconduct of the City or of other third parties not under the control or the supervision of
Consultant. Consultant's obligation to defend pursuant to this Section shall apply independent of
any prior, concurrent or subsequent misconduct, negligent acts, errors or omissions of
Indemnitees. Consultant shall defend Indemnitees in any action or actions filed in connection
with any of said claims with counsel of Consultant's choice, subject to City's reasonable
approval, and shall pay all costs and expenses, including all attorneys' fees actually incurred in
connection with such defense, provided that in the event that any damages are determined by the
court to have been caused in part by persons or entities other than Consultant, Consultant's
obligation hereunder shall be in proportion to Consultant's share of fault.
10.2. Other Indemnities. In connection with all Claims not covered by Section
10.1, Consultant shall defend, hold harmless and indemnify the Indemnitees with respect to any
and all Claims including but not limited to Claims relating to death or injury to any person and
injury to any property, which arise out of, pertain to, or relate to and to the extent of the negligent
or other wrongful acts or omissions of Consultant or any of its officers, employees,
subcontractors, or agents in the performance of this Agreement. Consultant shall defend
Indemnitees in any action or actions filed in connection with any such Claims with counsel of
Consultant's choice, subject to City's reasonable approval, and shall pay all costs and expenses,
including all attorneys' fees and experts' costs actually incurred in connection with such defense.
Consultant's duty to defend pursuant to this Section shall apply independent of any prior,
concurrent or subsequent misconduct, negligent acts, errors, or omissions of Indemnitees.
10.3. Acknowledgment of Indemnity Duties. By affixing his or her initials
below, each party representative hereby acknowledges that the representative has read and
accepted the provisions set forth in this Section 10.
City Consultant Consultant
10.4. Nonwaiver of Rights. Indemnitees do not, and shall not, waive any rights
that they may possess against Consultant because of the acceptance by City, or the deposit with
City, of any insurance policy or certificate required pursuant to this Agreement.
10.5. Waiver of Right of Subrogation. Consultant, on behalf of itself and all
parties claiming under or through it, hereby waives all rights of subrogation against the
Indemnitees, while acting within the scope of their duties, from all claims, losses, and liabilities
arising out of or incident to activities or operations performed by or on behalf of the Indemnitor.
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10.6. Survival. The provisions of this Section 10 shall survive the termination
of the Agreement and are in addition to any other rights or remedies that Indemnitees may have
under the law. Payment is not required as a condition precedent to an Indemnitee's right to
recover under this indemnity provision, and an entry of judgment against a Consultant shall be
conclusive in favor of the Indemnitee's right to recover under this indemnity provision.
11. Insurance.
11.1. Liability Insurance. Consultant shall procure and maintain in full force
and effect for the duration of this Agreement insurance against claims for injuries to persons or
damages to property and professional negligence which may arise from or in connection with the
performance of the services hereunder by Consultant, and its agents, representatives, employees
and subconsultants.
11.2. Minimum Scope of Insurance. Unless otherwise approved by City,
coverage shall be at least as broad as:
Insurance Services Office Commercial General
Liability coverage (occurrence form CG 0001).
Insurance Services Office form number CA 0001
(Ed. 1/87) covering Automobile Liability, code 1 (any
auto).
Worker's Compensation insurance as required by
the State of California and Employer's Liability Insurance.
Professional Liability insurance. Consultant shall
provide to City the standard form issued by the carrier.
11.3. Minimum Limits of Insurance. Consultant shall maintain limits no less
than:
General Liability: $1,000,000 per occurrence and in the
aggregate for bodily injury, personal injury and property
damage. Commercial General Liability Insurance or other
form with a general aggregate limit shall apply separately
to this Agreement or the general limit shall be twice the
required occurrence limit.
Automobile Liability: $1,000,000 per accident for bodily
injury and property damage.
Employer's Liability: $1,000,000 per accident and in the
aggregate for bodily injury or disease and Workers'
Compensation Insurance in the amount required by law.
Professional Liability: $1,000,000 per claim/aggregate.
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11.4. Deductibles and Self- Insured Retentions. Consultant shall inform City of
any deductibles or self - insured retentions except with respect to professional liability insurance.
11.5. Other Insurance Provisions. The general liability and automobile liability
policies are to contain, or be endorsed to contain, the following provisions:
11.5.1. City, its officers, officials, employees, designated volunteers and
agents serving as independent contractors in the role of city or agency officials, are to be covered
as additional insureds as respects: liability arising out of activities performed by or on behalf of
Consultant; products and completed operations of Consultant; premises owned, occupied or used
by Consultant; or automobiles owned, leased, hired or borrowed by Consultant. The coverage
shall contain no limitations on the scope of protection afforded to City, its officers, officials,
employees, designated volunteers or agents serving as independent contractors in the role of city
or agency officials which are not also limitations applicable to the named insured.
11.5.2. For any claims related to this Agreement, Consultant's insurance
coverage shall be primary insurance as respects City, its officers, officials, employees,
designated volunteers and agents serving as independent contractors in the role of city or agency
officials. Any insurance or self - insurance maintained by City, their officers, officials,
employees, designated volunteers or agents serving as independent contractors in the role of city
or agency officials shall be excess of Consultant's insurance and shall not contribute with it.
11.5.3. Consultant's insurance shall apply separately to each insured
against whom claim is made or suit is brought, except with respect to the limits of the insurer's
liability.
11.5.4. Each insurance policy required by this clause shall be endorsed to
state that coverage shall not be canceled except after 30 days prior written notice by first class
mail has been given to City or 10 days prior written notice by express overnight mail if
cancellation is due to nonpayment of premiums.
11.5.5. Each insurance policy, except for the professional liability policy,
required by this clause shall expressly waive the insurer's right of subrogation against City and
its elected officials, officers, employees, servants, attorneys, designated volunteers, and agents
serving as independent contractors in the role of city or agency officials.
11.6. Acceptability of Insurers. Insurance is to be placed with insurers with a
current A.M. Best's rating of no less than A: VII unless waived in writing by City's Risk
Manager.
11.7. Verification of Coverage. All insurance coverages shall be confirmed by
execution of endorsements on forms approved by the City. The endorsements are to be signed
by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be
received and approved by City before services commence. As an alternative to City forms,
Consultant's insurer may provide complete, certified copies of all required insurance policies,
including endorsements affecting the coverage required by these specifications.
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11.8. Subconsultants. Consultant shall include all subconsultants as insureds
under its policies or shall furnish separate certificates and endorsements for each subconsultant.
All coverages for subconsultants shall be subject to all of the requirements stated herein unless
otherwise approved in advance in writing by City.
12. Cooperation. In the event any claim or action is brought against City relating to
Consultant's performance or services rendered under this Agreement, Consultant shall render
any reasonable assistance and cooperation that City might require. City shall compensate
Consultant for any litigation support services in an amount to be mutually agreed upon by the
parties.
13. Termination. Either party shall have the right to terminate this Agreement at any
time for any reason on written notice to the other party. In the event either party exercises its
right to terminate this Agreement, City shall pay Consultant for any services rendered prior to the
effective date of the termination. Consultant shall have no other claim against City by reason of
such termination, including any claim for compensation.
14. Suspension. City may, in writing, order Consultant to suspend all or any part of
the Consultant's Services for the convenience of City or for work stoppages beyond the control
of City or Consultant. Subject to the provisions of this Agreement relating to termination, a
suspension of the Services does not void this Agreement.
15. Notices. Any notices, bills, invoices, or reports authorized or required by this
Agreement shall be in writing and shall be deemed received on (a) the day of delivery if
delivered by hand or overnight courier service during Consultant's and City's regular business
hours or by facsimile before or during Consultant's regular business hours; or (b) on the third
business day following deposit in the United States mail, postage prepaid, to the addresses
heretofore set forth in the Agreement, or to such other addresses as the parties may, from time to
time, designate in writing pursuant to the provisions of this section. All notices shall be
addressed as follows:
If to City: City Clerk
City of Seal Beach
211 - 8th Street
Seal Beach, California 90740
Fax: (562) 493 -9857
With a copy to:
Public Works Director
City of Seal Beach
211 - 8th Street
Seal Beach, California 90740
If to Consultant: Mr. Brian Jewett
Willdan Financial Services
27368 Via Industria, Suite 110
Temecula CA 92590
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16. Non Discrimination and Equal Employment Opportunity. In the performance of
this Agreement, Consultant shall not discriminate against any employee, subconsultant, or
applicant for employment because of race, color, creed, religion, sex, marital status, national
origin, ancestry, age, physical or mental handicap, medical condition, or sexual orientation.
Consultant will take affirmative action to ensure that subconsultants and applicants are
employed, and that employees are treated during employment, without regard to their race, color,
creed, religion, sex, marital status, national origin, ancestry, age, physical or mental handicap,
medical condition, or sexual orientation.
17. Non - Assignability; Subcontracting. Consultant shall not assign, transfer, or
subcontract any interest in this Agreement or the performance of any of Consultant's obligations
hereunder. Any attempt by Consultant to so assign, transfer, or subcontract any rights, duties, or
obligations arising hereunder shall be null, void and of no effect.
18. Compliance with Laws. Consultant shall comply with all applicable federal, state
and local laws, ordinances, codes and regulations in force at the time Consultant performs the
Services.
19. Non - Waiver of Terms, Rights and Remedies. Waiver by either party of any one
or more of the conditions of performance under this Agreement shall not be a waiver of any
other condition of performance under this Agreement. In no event shall the making by City of
any payment to Consultant constitute or be construed as a waiver by City of any breach of
covenant, or any default which may then exist on the part of Consultant, and the making of any
such payment by City shall in no way impair or prejudice any right or remedy available to City
with regard to such breach or default.
20. Attorneys' Fees. In the event that either party to this Agreement shall commence
any legal action or proceeding to enforce or interpret the provisions of this Agreement, the
prevailing party in such action or proceeding shall be entitled to recover its costs of suit,
including attorneys' fees actually incurred in connection with such enforcement or interpretation.
21. Exhibits; Precedence. All documents referenced as exhibits in this Agreement are
hereby incorporated in this Agreement. In the event of any material discrepancy between the
express provisions of this Agreement and the provisions of any document incorporated herein by
reference, including but not limited to the Consultant's Proposal and Fee Schedule dated August
27, 2008 and attached hereto as Exhibit A, the provisions of this Agreement shall prevail.
22. Construction. The validity, interpretation, and performance of this Agreement
shall be controlled by and construed under the laws of the State of California. In the event of any
asserted ambiguity in, or dispute regarding the interpretation of any matter herein, the
interpretation of this Agreement shall not be resolved by any rules of interpretation providing for
interpretation against the party who causes the uncertainty to exist or against the party who
drafted the Agreement or who drafted that portion of the Agreement.
23. Entire Agreement. This Agreement, including any other documents incorporated
herein by specific reference, represents the entire and integrated agreement between Consultant
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and City. This Agreement supersedes all prior oral or written negotiations, representations, or
agreements. This Agreement may not be amended, nor any provision or breach hereof waived,
except in a writing signed by the parties which expressly refers to this Agreement.
IN WITNESS WHEREOF, the parties, through their respective authorized
representatives, have executed this Agreement as of the date first written above.
CITY OF SEAL BEACH CONSULTANT
By: By:
David Carmany, City Manager Name: Mark Risco
Title: Vice President/Group Manager
Attest:
BY: IA LA .
Name: oy L. Gill
Linda Devine, City Clerk
Title: Secretary, Chief Financial
Approve to Form: Officer
(Two signatures required for corporations
By: under California Corporations Code § 313)
Quinn Barrow, ity Attorney
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EXHIBIT A
Consultant's Proposal Dated August 27, 2008
(Including Scope of Services)
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` WILLDAN I extending
§ Financial Services reach
August 27, 2008
Mr. Vince Mastrosimone
Director of Public Works
City of Seal Beach Department of Public Works
211 Eighth Street
Seal Beach, California 90740
Re: Technical Proposal to Conduct a Water Rate Study for the City of Seal Beach
Dear Mr. Mastrosimone:
Willdan Financial Services, formerly MuniFinancial, (Willdan) is pleased to submit this proposal to the
City of Seal Beach to prepare a Water Rate Study for the Seal Beach Municipal Water Utility. We will
partner with our colleagues at Integrated Resource Management (IRM) for this engagement in order
to provide seamless support in the identification of water rates for each customer class served by the
City. The sections that follow this letter provide a detailed description of our firm's qualifications and
experience, project approach, scope of services, and the qualifications of our project team.
The City is demonstrating its commitment to high quality public service by ensuring that customer
utility rates meet the City's financial policies, comply with the legal requirements of rate and fee
setting in California, and promote water resource conservation efforts. To this end, the resulting rate
structure must provide adequate cost recovery for your utility while ensuring that rates meet cost of
service principles as required by California Constitution Articles XIIIC and XIIID (Proposition 218) and
State regulatory requirements.
Our solution is to develop a financial plan that will help the City meet these objectives. Our results will
provide defensible and quality client deliverables for high levels of integrity and outcomes. We will
develop a user-friendly financial model that has the flexibility to generate alternative rate options,
illustrates the impacts each alternative would have on ratepayers, and demonstrates Proposition 218
cost of service principles. Because we take pride in the collaborative spirit with which we approach
our engagements, we will work closely with City staff members throughout the project to ensure that
the financial plan and final rate structure are both useful and reliable to the City for years to come.
Our team has a unique combination of expertise in rate setting, water utility engineering, Proposition
218 compliance strategies, and cost allocation procedures so critical to setting utility rates in
California. These traits ensure that the City's resulting rate structure will be technically defensible, will
meet City's financial and resource goals while reducing the likelihood of potential challenges to the
rate structure.
We are excited about this opportunity and look forward to hearing from you. If you have any questions
regarding our technical and/or cost proposal, please contact me at (800) 755-6864, or directly at
(951) 587-3568, or via email at bjewetta willdan.com.
Sincerely,
Willdan Financial Services
Brian Jewett, Vice President and Group Manager
Financial Consulting Services Group
Enclosure
Engineering I Geatecnnical I Environmental ; Finauclal 1 Homeland Security
951.587.3500 1 800.755.6864 I tax:951.587.3510 1 27368 Via Industrie,Suite 110,Temecula,CA 92590 I www.willdan.com
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iVILLDAN
Financial Sery:ces
TABLE OF CONTENTS
FIRM'S QUALIFICATIONS 1
About Willdan 1
About Integrated Resource Management 1
PROJECT EXPERIENCE 2
Client References — Willdan & Integrated Resource Management 3
APPROACH 6
Project Understanding 6
Project Methodology 7
SCOPE OF SERVICES 10
Anticipated City Staff Support 13
PROJECT TEAM QUALIFICATIONS 14
PROJECT SCHEDULE 18
CONTRACT EXCEPTIONS 19
OTHER REQUESTED DOCUMENTS 20
Proposal to Conduct a Water Rate Study for the City of Seal Beach l
I
/WILLDAN
Financial Services
Firm 's Qualifications
About Willdan
Willdan Group, Inc. (Willdan) is a nationwide firm serving more than 800 public agencies and
private sector clients. We provide engineering, management, and financial consultant services
that ensure the quality, value, and security of our nation's infrastructure, systems, facilities, and
environment. The firm has been a consistent industry leader in providing all aspects of municipal
and infrastructure engineering, public works contracting, public financing, planning, building and
safety, construction management, and homeland security services. Currently we are ranked 154
on the Engineering News Record list of the Top 500 Engineering firms.
Comprehensive Solutions. Integrated Approach.
Founded in 1964 and headquartered in Anaheim, California, Willdan was originally established as
a civil engineering firm specializing in providing solutions for our public agency clients. Since that
time we have evolved into a professional consulting firm offering a broad array of services that
allow us to provide a comprehensive and integrated approach to our clients' planning,
engineering, financial, economic, public facility, and public safety challenges. Today, Willdan has
over 550 employees operating out of more than 20 offices located throughout California, as well
as in Arizona, Nevada, Utah, Colorado, Florida, Maryland, North Carolina, Tennessee, and
Wisconsin.
Willdan has comprehensive knowledge of public agency operations as well as expertise in city
engineering, building and safety, planning, finance, grant funding, emergency plan development
and CSA administration and conversion; just to name a few. Willdan's clients include -
municipalities, counties, special districts, public health agencies, school districts, ports, tribal and
state agencies and the federal government throughout the Southwest United States.
About Integrated Resource Management
Integrated Resource Management, LLC (IRM) is an innovative environmental business
development, planning, project management, advocacy and marketing firm comprised of natural
resource professionals with extensive experience providing solufions to water, wastewater and
environmental issues in both the private and public sectors.
IRM was established in 1997 as a resource consulting firm dedicated to providing practical
problem-solving techniques to water-related issues. During the past six years, the firm has
worked with a variety of companies to provide resource and compliance evaluation, development
and security of resources for the future. IRM has also dedicated its staff to the ongoing
development of emerging technologies related to water and wastewater conveyance, treatment
and disposal, and to environmental compliance and remediation.
IRM represents clients in over 200 watersheds throughout the United States and Canada.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
I
WW I LLDAN
,� Financial Services
Project Experience
For the past 11 years, we have prepared cost of service and utility rate analyses for a variety of
municipalities and special districts. Our project team is experienced in equipping our clients to
face the challenges of utility enterprises in the Western United States. A partial listing of our
clients follows:
`Wilidani Financial Services
Utility related Clients ,
• City of Avenal, CA • ?own of Florence, AZ • City of Port Hueneme, CA
• City of Brookings, OR • City of Fort Bragg, CA • City of Port Richey, FL
• City of Calexico, CA • City of Fountain Valley. • City of Rio Vista, CA
• City of Claremont. CA CA • San Diego County Water
• City of Coachella, CA • City of Hollister, CA Authority, CA
• City of Compton, CA • City of Indio. CA City of Can Fernando, CA
• City of Corcoran. CA Laguna Beach County • City of South Gate, CA
• City of Covina. CA Water District, CA • City of Stockton. CA
• City of Crescent City, • Loucadia Wastewater • City of Vista, CA
CA District, CA • Walnut Valley Water
• East Valley Water • City of Lomita, CA District, CA
District, CA • City of McFarland, CA • City of Wilmington. NC • -
• Elsinore Water District, • City of Merced, CA • City of Woodland, WA
CA - Mesa Consolidated Water
• Encina Water Pollution District, CA
Control Authority, CA
Proposal to Conduct a Water Rate Study for the City of Seal Beach I I
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WILLDAN
Financial Seances
Client References — Willdan & Integrated Resource
Management
We are proud of our reputation for customer service and encourage you to contact our past
clients regarding our commitment to excellence.
City of Fountain Valley, CA
Water Rate Study
Willdan conducted an independent review of the City's water rate structure. Contact Information
The City has local access to groundwater and Metropolitan Water District Mark Lewis,P.E., Director of
supplies which are resulting in higher water purchase costs for the City. Public Works/City Engineer
10200 Slater Ave
Furthermore, the City is facing significant capital project investment needs. Fountain Valley, CA 92708
The former rate structure was inadequate in providing sufficient revenue to Tel#: (714)593-4435
face these cost pressures. Willdan developed a 10-year budget requirement Duration
analysis for the City's water utility, identified separate fixed and commodity September 2007-January
charges through an intensive Proposition 218 analysis, and developed a 200e
reserve policy to provide sufficient funding for future operational and capital
needs through an integrated planning process.
City of Covina, CA
Water and Wastewater Rate Study
Willdan conducted a comprehensive water rate analysis for the City of Covina Contact Information
in 2004 and subsequently provided an update to the water rate analysis in Steve Hendley
2008 including a separate wastewater rate analysis. The City's water provision Director of Public Works
125 E State College St.
system includes inside City customers as well as customers located outside Covina,CA 91723
City boundaries. As part of this analysis, a rate structure consisting of a fixed Tel#:(626)858-7294
charge, a variable charge, a Capital Improvement Program charge, and a Duration
private fire protection charge was developed. A unique project aspect was the 2004&February 2008-June
creation of a drought pricing formula to be used in times of reliance on outside 2008
water sources, such as Metropolitan Water District, at a significantly higher
price per-acre foot than typical City sources. The analysis also included
reviewing the cost allocation factor assigned to the water enterprise fund to
ensure that the fund is allocated its reasonable share of indirect costs.
Recently, Willdan updated the City's water rate structure and also provided the
City with a comprehensive wastewater rate analysis to fund significant sewer
capital project needs throughout the City.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
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3 Financini Services
City of Lomita
Water System Financing Plan and Rate Study and Water Rate Structure Review
Analysis
The City of Lomita's last water rate analysis was conducted many years ago, Contact Information
and water rates had not been adequately adjusted since 1996. Willdan Tom Odom
prepared a water system financing plan and rate study that proposed a rate City Manager
24300 Narbonne Ave
structure including an increasing rate block method to promote water Lomita, CA 90717
conservation. Currently, we are providing a water rate structure review Tel#: (310)325-7110
analysis to support the issuance of water revenue bonds for the re- Duration
construction of the City's central water reservoir. 2004,Rate Review&Bond
Financing Analysis 2007-
Current
City of Imperial, CA
Development of Urban Water Manaernent Plan
IRM prepared and implemented the City of Imperial's 2005 Urban Water Contact Information
Management Plan. The City of Imperial's Water Department runs the City's Jackie Loper
water system, while the Imperial Community Development Department helps
Develop of Community
Development/Public
plan for the City's future water resource development. The Urban Water Services
Management Plan is part of that overall planning initiative. 420 5 Imperial Ave
Imperial,CA 92251
An Urban Water Management Plan, as defined by the California Legislature in Tel#:(760)355-1152
the California Urban Water Management Planning Act, informs residents, Duration
neighboring agencies and local community groups on how an urban water 2005
agency will provide a safe, secure water supply in the short and long term. The
final plan attempts to look 25 years into the future to project what the City of
Imperial's water supply will look like in 2030. Included in that long-term
projection are predictions concerning future water demand, contingency
planning in case of short- or long-term droughts and other catastrophes, and
potential strategies to enhance and diversify the City of Imperial's water
portfolio with recycled water, desalination and water marketing options.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I j a
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Financial Sery cos
City of East Palo Alto, CA / California American Water
Company
Water Rate Structure Review Analysis & Urban Water Management Plan
IRM prepared and implemented with the City of East Palo Alto its 2005 Urban Contact Information
Water Management Plan. The City of East Palo Alto contracts its water utility Chris Alario
service to California American Water Company. IRM was responsible for vice President
111 North Sepulveda Blvd,
coordinating with a private utility service provider while conducting a public Ste 250-41
process for development of the Urban Water Management Plan. Manhattan Beach, CA 90266
Tel#:(310)863-9440
IRM routinely conducts an independent review of the City's water rate Duration
structure for California American Water Company. Goals for this project 2005
include: identify separate fixed and commodity charges, encourage water
conservation through a tiered commodity pricing system and generate
sufficient rate revenue to accommodate significant capital expenses.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I s- I t 1
W- �VILLDAN
jj Financial Services
Approach
Project Understanding
The City of Seal Beach is seeking an outside consultant to prepare a comprehensive Water Rate
Study. The last rate analysis was performed in 2003 with a five-year rate schedule expiring this
year. Since that time, water replenishment and imported purchase costs have increased
significantly as have other utility-related expenses. In addition, agencies such as the City are
facing pressures to encourage water conservation among its customer base. One approach to
achieve conservation goals is to develop a tiered commodity rate structure, an approach the City
desires through this upcoming rate analysis. Finally, California water agencies are faced with new
legal requirements in water rate setting with the 2006 California Supreme Court decision in the
Bighorn case. This court decision ruled that water rates in California are property-related and
therefore agencies sponsoring new or increased water rates must meet the substantive and
procedural requirements of Proposition 218 (Articles XIIIC and XIIID of the California
Constitution). Our project team is uniquely qualified to address these significant issues and
meet the City's goals for rate setting.
Throughout this project, we will collaborate with City staff to ensure that the results meet the
City's fiscal policies and community goals for rate equity, customer fairness and resource
conservation. Through a simplified and understandable approach, the resulting rate structure will
effectively meet these objectives. The results of the analysis are expected to include the
following:
• Provide an analysis of the advantages and disadvantages of the City moving to a water-
based budget structure to promote water conservation similar to structures employed by the
Irvine Ranch Water District and City of San Juan Capistrano (this effort will be a feasibility
study only);
• Generate results of customer class consumption analysis to include the data elements and
factors used to categorize customer classes and average water consumption levels per class;
• Develop a cost allocation structure that ensures each customer class pays its proportionate
share of water service costs through the combination of a fixed service charge based on
meter size and a variable or commodity-based rate(s) for each class based on factors such
as lot size, occupancy status, system and class peaking factors, and/or meter size;
• Prepare a tiered-rate structure identifying water sales and consumption by target level or
consumption blocks;
• Provide an easy-to-understand report that quantifies the short-term and long-term impacts to
each customer class of the resulting rate structure;
• Prepare an easy to navigate computer rate model for the City's use;
• Develop financial reserve policies for the water utility to include, at a minimum, an Operating
Reserve, Capital Projects Reserve and Replacement Reserve;
• Meet Proposition 218 cost of service principles and State regulatory requirements; and,
• Present the results and recommendations to the City and the community in a clear and
concise manner.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I 2.0
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WAWILLDAN
Financial Services
Project Methodology
The approach, philosophy, and methodology of utility rate setting are as important as the final
outcome. The final rate structure must be defensible, clearly understood by staff as well as the
community, and useful for improving long-term financial performance. By blending the following
five key components, our utility rate analyses support these objectives in simple and user-friendly
terms:
• Financial Planning - We will ensure that cost needs of the City are met through a
comprehensive revenue requirements analysis. Our financial models will allow the City to
produce optional scenarios and sensitivity analyses of various rate alternatives. Once the
revenue requirements are identified, we will allocate them across customer classes using
generally accepted cost-based practices as endorsed by the American Water Works
Association (AWWA) and Water Environment Federation.
• Customer Concerns - When the planning is done, City staff members must be able to deal
with the consequences of any rate analysis. We are sensitive to this point and believe that
the process of reaching the final result is equally as important as the final result itself. We
pride ourselves on our ability to ensure that senior staff members feel confident with the final
product through on-going collaboration with staff during the entire project and after the rates
are implemented.
• Community Support-The final step in executing affordable and stable utility rates is having
the support of the community. Without this key aspect, all previous work would be in vain.
Our seasoned staff members have actively participated in legislative body meetings to
educate and inform policymakers and local constituents on the benefits and risks associated
with new rate policy decisions.
• Comprehensive Computer Modeling - Our staff members are seasoned computer
modelers who can design and develop different economic models. Along with a solid
understanding of computer modeling, our staff members also have a deep understanding of
finance, economics, and engineering-the foundations of our models.
• Proposition 218 Compliance - Recent court decisions have shed light on the relationship
between utility rate setting in California and Proposition 218. Our staff is at the forefront of
Proposition 218 compliance issues in the areas of taxes, assessments and property-related
fees, including water, wastewater, and storm water rates. As part of our relationship with the
City, we will provide our Proposition 218 experience in developing a noticing strategy and
outreach process for implementation of new rates.
Key Aspects
There are four critical aspects of this project: Financial Planning Analysis, Cost Allocation, Utility
Rate Model Development, and Reports and Presentations.
Financial Planning Analysis
The objective of the Financial Planning Analysis is to determine a stable revenue stream over a
multi-year planning period that produces a sufficient level of cash flow to pay for costs associated
with the provision of utility services while taking into consideration foreseeable risks. We ensure
that this analysis produces a financial model that takes into account the following important cost
factors:
• Administrative and Operation Costs - Administrative, managerial, and operating costs
associated with the provision of utility services over the planning period.
• Capital Requirements - Full funding of the capital improvement program from reasonable
sources, including cash revenues, current surplus revenues, and external funding sources.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I 2...k
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/WI LLDAN
Financial Serv.ees
The models will allocate the least-cost mix of capital funding sources and will calculate debt
service associated with any debt secured by system revenues.
• Fund Reserves - There are three main types of reserves that the City may consider for the
City's Water Enterprise Fund:
• O&M Reserve - Focuses on yearly cash flow circumstances and can be used for Rate
Stabilization efforts. A typical O&M Reserve Fund should include 45 days to three months
of the annual O&M cost. Our models will incorporate several time periods to determine
the sensitivity of longer periods of reserve time on the proposed rates.
• Capital improvement Plan (CIP) Reserve - Focuses on maintaining a reserve for future
major capital projects, such as expansions and upgrades. The reserve amount can be
designed to match the system's annual depreciation schedule or as an annual average of
the system's CIP schedule.
• Replacement Roserse. - Focuses on providing capital for minor renewal and replacement
of system equipment and related capital needs. This reserve amount can be designed as
a matter of City policy or based on historical annual replacement costs.
The financial planning model will be developed in concert with City staff input and will not be
overly complex and burdensome. Yet, the capabilities of our financial model will allow it to
perform sensitivity analyses on the above factors to illustrate potential risks and impacts on the
system rate base. By correctly modeling these relationships, senior staff members can make
informed decisions on the appropriate revenue requirement for the City's Water Enterprise Funds.
Cost Allocation
Cost Allocation focuses on the allocation of the revenue requirements from the financial planning
model among the City's customer classes. It is at this point that the rate structure reflects a
thorough understanding of Proposition 218 cost of service principles. Our model can allocate
each line item budget in the Water Enterprise Fund to the appropriate categories of system
characteristics. This cost allocation function will ensure that each customer class pays its fair
share of providing reliable utility service.
Utility Rate Model Development
The third step is to develop a Utility Rate Model, which translates the customer class fair share of
the revenue requirement into an actual rate structure for utility services. This type of analysis
addresses the following four policy criteria:
• Financial Sustainability- Does the proposed rate structure reduce the volatility of revenue,
and are all program costs met to assure the financial feasibility of the system?
• Social Responsibility - Is the new rate structure equitable to all customer classes? There
may be social and political concerns that certain customer classes cannot afford a higher rate
structure.
• Defensibility -- Is the new rate structure compliant with existing State law, for example
Proposition 218 requirements?
• Administrative Ease — Is the proposed rate structure easy to administer and simple to
explain? Complex rate structures may create unforeseen administrative challenges, such as
adaptation to the City's current utility billing structure, or may require significant public
outreach to educate customers on the need for a new rate structure or updated utility rates.
We recognize that each agency will place different weights on the above criteria. We will work
closely with City staff members to understand the values of the community. Our utility rate
Proposal to Conduct a Water Rate Study for the City of Seal Beach - ��,h
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• WILLDAN
Financial Services
structure approach will embody these values to produce a financially sustainable, equitable, and
environmentally sound rate structure that is easily administered and legally justified.
Reports & Presentations
The final and equally important step of the rate analysis project is to develop a thorough and clear
report and presentation that describes the approach and process by which the rate structure and
corresponding alternatives were determined. A report that is overly complicated will only confuse
the stakeholders in the process. Our reports provide information in a clear manner and will enable
elected officials to take action on a recommendation as well as provide City staff with a document
to explain the rate structure to interested parties and make adjustments in the future, if needed.
We understand the environment that agencies work within when it comes to policy-making and
rate adoption. It is never an easy task to face the public with new utility rates or a new rate
structure. Clear, concise, and consistent messages are critical to the process. Our presentations
are designed with these principles in mind. We understand the pressures that elected officials
and agency staff face—many of our consultants have served in local government during their
careers. Therefore, we focus on the highlights of the rate analysis process, our
recommendations, and the potential impacts on ratepayers. In short, we strive to ensure that our
presentations assist in building consensus and garnering public support.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
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Wd \WI LLDAN
t. Financial Services
Scope of Services
The following scope of services provides detailed steps to ensure that your project is completed
successfully and encompasses our approach and methodology to prepare a Water Rate Study for
the City of Seal Beach.
1 . Project Kick-off Meeting in Seal Beach
To initiate the City of Seal Beach's Water Rate Study project, we propose to meet with City staff
for a kick-off meeting at City offices to discuss project objectives, schedule, deliverables, and
policy considerations of the City. Staff would be able to highlight concerns, and assist us in
focusing our work program to its specific needs and policies. We will also discuss the community
and public environment during this meeting and determine the best approach to balance these
issues with the City's Water Rate Study objectives. After the meeting, introductions could be
made with key staff that we will be working with throughout the course of the project. In addition,
we will identify our relevant documentation and data requirements and create a project timeline to
ensure that the project's milestones are met.
2. Project Understanding & Data Requirements
To facilitate efficiency in the project schedule, we anticipate receiving the following water-specific
documentation at the project kick-off meeting or shortly thereafter:
• Financial documentation for the last three years. This request would include past and current
operating and capital expenses as well as revenue sources included in such documentation
as enterprise fund budgets, audited financial statements, CAFRs, asset records, capital
improvement schedules and costs, and official statements with bond covenants and debt
service schedules;
• Past rate analyses;
• Customer characteristic data such as account classifications, number of meters and meter
sizes, consumption data by customer class;
• The most current Water Facilities Master Plan;
• Urban Water Management Plan; and,
• The past three years of the billing database for the water utility.
3. Feasibility Analysis Related to Water Based Budget Rate Structure
The City is considering moving to a water-based budget or efficiency analysis. A comprehensive
water efficiency analysis is a large undertaking requiring significant resources to develop
adequate water budgets for each customer or property type. Before the City embarks on such an
analysis, we propose to conduct a feasibility study to examine the advantages and disadvantages
of implementing water efficiency allocation factors. Our analysis will consider resources available
to conduct the analysis, costs, timing, implementation factors, customer appeal requirements, and
allocation factors that would best suit the needs and resource commitments of the City. We will
deliver a technical memorandum describing the results of the feasibility analysis.
Proposal to Conduct a Water Rate Study for the City of Seal Beach l
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VVWILLDAN
Financial Serriups
4. Data Analysis, Financial Planning, & Revenue Requirement Analysis
During Task 4 we will analyze documentation and data requested above and develop the
financial plan and revenue requirements analysis. The spreadsheet models will include elements
related to:
• Operating and Non-Operating Fund expenses including debt service and related coverage
ratios per bond covenants, projected capital improvement costs, depreciation, interest
expense, and other related items;
• Historical and projected revenues (five years) using growth forecasts in each customer class;
• Operating, Capital Project and Capital Replacement Reserve fund development based on
City policy and industry standards; and,
• Fund cash flow.
In the case of the financial model, we will work with City staff members to define the base case
scenario by developing a financial table that highlights expenditure levels for operations and
capital programs and any other factors that can affect the revenue requirement over a five-year
period. The model will have the flexibility to modify the base case scenario to account for
sensitivity analysis. We will provide a preliminary model to City staff for review and comment and
follow up with staff during a meeting at City's offices and conference calls to discuss the model.
The models provide the basis for cost allocation and alternative rate design. They have the
requisite flexibility to allow the user to make adjustments to each line item of the revenue
requirements spreadsheet, ranging from adjusting cost inflation factors to changing debt service
coverage ratios. To enhance the simplicity of the models, the first spreadsheet within the
workbook is a comprehensive data input page color-coded for user simplicity. Each color signifies
an input function, result function or assumption function. This page allows the user, whether it is
City staff or us, to quickly calculate "what if" scenarios and determine the resulting rate impact for
each customer class.
5. Utility Rate Model Design
Incorporating the results of the financial modeling for the water system, we will conduct a rate
analysis that will allocate system costs across customer classes, design alternative rate
structures, and determine customer impact from each option.
In the case of the utility rate model, we will provide detailed information on water usage patterns
based on accounts and/or customer classes. This demographic information will be utilized to
develop a comprehensive rate model. The nature of these demographics will provide insight on
the appropriate and equitable water rates.
We allocate costs functionally across customer classes. This means that we examine customer
class water consumption patterns and categorize each customer based on these patterns. Fixed
costs, such as billing expenses and automated meter reading costs, will be allocated to each
customer class based on meter size and meter equivalency ratio characteristics.
We analyze and develop rates using a "cash basis" approach as endorsed by the AWWA. Our
cost allocation procedure uses the "base-extra capacity" methodology that incorporates variable
components such as average daily water consumption, maximum day demands, and peak hour
Proposal to Conduct a Water Rate Study for the City of Seal Beach I 2.1
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AFinancial Services
demands. If this information is not readily available, we will use industry standards or employ a
different methodology based on a fixed versus variable functionalization of budget line items. In
both approaches, a solid cost of service analysis will be evident with the goal of creating an
equitable rate structure exhibiting a fixed meter charge element and a variable consumption-
based element.
6. Prepare Draft Comprehensive Utility Rate Analysis Report
We will prepare Administrative Draft and Preliminary Draft reports that encompass the
spreadsheet models and integrate our findings from the previous tasks. We will provide a
detailed, yet easy-to-read, report for City staff and policymakers. In the case of the Financial
Planning Analysis, we will include the proposed revenue requirements and supporting
documentation to show how the proposed revenue requirement has taken into account highly
probable risk.
Customer Impact Analysis
The report will include the alternative rate structures and our recommendation(s)and will illustrate
the impacts of each alternative on each customer class within the City using easy to read tables
and graphs.
Comparative Rate Analysis with Other Jurisdictions
We will include a comparative matrix of surrounding jurisdictions that will identify other
neighboring utility service providers' utility rates in comparison to the City's current and proposed
rate structure. We have found this comparative analysis to be a useful tool for elected officials
and agency staff in implementing new water rates.
The report will also serve as a manual for City staff. This report will assist in gaining an
understanding of how the rate structure is developed and can be modified in the future should
budgetary or customer demands change. The report will suggest changes to be made to the
language of the rate implementation ordinance.
We will prepare and distribute ten (10) copies of the draft study report. We will attend a City
Council meeting to present our preliminary findings and the draft report.
7. Review, Revise. & Present Comprehensive Report & Findings
After our review of the report with City staff and our City Council presentation, we will refine any
questionable areas or concerns. This task will also serve as a quality control review. Input on the
draft report will be solicited from staff. Corrections and clarifications will be added to the final
report to ensure full coverage and clear explanations.
Following review and comment, we will present the final report, including the recommended rate
structure, at one (1) City Council meeting. We are experienced in providing presentations to
various stakeholders and legislative bodies. We are particularly skilled at taking complex issues,
such as rate studies, and presenting them to laypersons in an understandable and concise
manner. We will also attend the Public Hearing to support staff with any questions from the City
Council or customers.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
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s' Flnanrrrl
Seri r:es
We will provide the City with up to ten (10) bound copies and one (1) unbound reproducible copy,
and copies of any presentations. We can provide our report and model to the City on CD/ROM
using Microsoft Word and Microsoft Excel format.
8. Proposition 218 Strategy Development and Community Education Effort
We will work with City staff to develop a sound Proposition 218 noticing strategy for
implementation of the water rates. Given the recent Bighorn Supreme Court decision, an agency
that tries to implement new or increasing water and sewer rates must provide a notice of Public
Hearing regarding the rates to each property that is subject to the new or increasing rates. We will
work with the City to develop a noticing strategy that explains the rate structure, the reason for
the increase, and the date, time and place of the Public Hearing on the matter.
Anticipated City Staff Support
We anticipate that the City's project manager will (1) coordinate responses to requests for
information, (2) coordinate review of work products and (3) help resolve policy issues. To meet
the schedule outlined in the Project Schedule section, we will expect responses to initial
information requests within five (5) business days, and follow up requests within five (5) business
days. If there are delays on the part of the City, we will contact the City's project manager
immediately to get the project schedule back on track. Willdan will endeavor to minimize the
impact on City staff in the completion of this project.
Furthermore, we will rely on the validity and accuracy of the City's data and documentation to
complete our analysis.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
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WILLDAN
Financial Services
Project Schedule
Willdan understands time is of the essence for the City of Seal Beach's Water Rate Study project.
The table below contains general timeframes for the City's project. We will work in concert with
City staff to develop specific project dates prior to commencing work.
The schedule outlined below can only be met with the cooperation of City staff. Delays in
responding to our requests for data and review will result in corresponding delays to the project
schedule.
- Project Schedule,
Water.Rate Study.'
City of Seal Beach `
z
Task : Period- Deliverables
Project Kick-off Meeting in Seal
Beach Week 1 Data Request
Project Understanding& Data Memorandum, if r
Requirements Weeks 2—3 applicable
Feasibility Analysis Related to Weeks 2 -6, Technical Memorandum'
Water Based Budget Rate Structure
Data Analysis, Financial.Planning, & Revenue Requirements;
Revenue Requirement Analysis Weeks 4—7 Analyss.,
Utility_Rate Model Design Weeks 8- 10." Draft Rate Model .,. : '
Prepare Draft Comprehensive Utility-- "
Rate Analysis Report Weeks 11 — 13 Draft Comprehensive Report
Review, Revise, & Present l Final Comprehensive Report&
Comprehensive Report&Findings Weeks 14 - 16` Rate Model & Presentations-
,
Proposition 218 Strategy' Sample Ballot, Notice and
Development&Community Week 16 Outreach Information'
Education Effort
Proposal to Conduct a Water Rate Study for the City of Seal Beach I 5
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Financial Services
Contract Exceptions
Willdan Financial Services' attorney has reviewed the City of Seal Beach's sample Professional
Service Agreement. We kindly request the City consider the contract exceptions outlined below.
10.2 Other Indemnities. In connection with all Claims not covered by Section 10.1,
Consultant shall defend, hold harmless and indemnify the Indemnitees with respect to any and all
Claims including but not limited to Claims relating to death or injury to any person and injury to
any property, which arise out of, pertain to, or relate to-the and to the extent of the negligent or
other wrongful acts or omissions of Consultant or any of its officers, employees, subcontractors,
or agents in the performance of this Agreement. Consultant shall defend Indemnitees in any
action or actions filed in connection with any such Claims with counsel of Consultant's choice,
subject to City's reasonable approval, and shall pay all costs and expenses, including all
attorneys' fees and experts' costs actually incurred in connection with such defense. Consultant's
duty to defend pursuant to this Section shall apply independent of any prior, concurrent or
subsequent misconduct, negligent acts, errors, or omissions of Indemnitees.
11.5.4. Each insurance policy required by this clause shall be endorsed to state that
coverage shall not be canceled or-materially-modified-except after 30 days prior written notice
by first class mail has been given to City, or 10 days prior written notice by express overnight mail
if cancellation is due to nonpayment of premiums.
Proposal to Conduct a Water Rate Study for the City of Seal Beach 2c1
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jFinancial Services
Other Requested Documents
Pursuant to the City of Seal Beach's Water Rate Study Request for Proposal (RFP), three water
rate study reports and the fee proposal are in separately sealed envelopes, and are marked
appropriately.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I .2 JO
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EXHIBIT B
Fee Schedule and Standard Billing Rates
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WILLDAN
S Financial Services
Project Budget
Based on our proposed scope of services outlined in this proposal, we propose a fixed fee of
$42,800, including direct expenses related to the project.
Note:
• Our fee does not include the cost of designing and mailing Proposition 218 notices. Should
the City desire our expertise and assistance in this area, we will work with the City to develop
a separate fee quote and scope of services for this endeavor.
• We will invoice the City of Seal Beach monthly based on percentage of work completed by
task. Invoices will include a description of services as well as a summary of costs to date by
task.
Hourly Rate Schedule
Additional services may be authorized and will be billed at our then-current hourly consulting
rates. Below is a table outlining our current hourly rates.
WILLDAN FINANCIAL SERVICES
HOURLY RATE SCHEDULE:.
TITLE HOURLY RATE:.
•
Group Manager $200
Principal Consultant 190'
Principal Engineer 200,
Senior Project Manager 155
Project Manager 135.
Senior Project Analyst 120i.
Senior Analyst 110
Analyst • 90:
Analyst Assistant 75'
Property Owner Services Representative 55`
Support Staff 50
Proposal to Conduct a Water Rate Study for the City of Seal Beach
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EXHIBIT C
Consultant Personnel
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__A Financial Services
Project Team Qualifications
Our management and supervision of the project team is very simple: staff every position with
experienced, capable personnel in sufficient numbers to deliver a superior product, on time and
on budget. With that philosophy in mind, we have selected senior professionals for the City of
Seal Beach's Water Rate Study. We are confident that the Willdan Team has a depth of
experience that will successfully fulfill the City's desired work performance. Resumes of the key
team members proposed for the City's project follow for your review.
Proposal to Conduct a Water Rate Study for the City of Seal Beach I 4
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WAWILLDAN
Financial Servicee
Brian Jewett
Principal-in-Charge
Brian Jewett will serve as the principal-in-charge for this project. He has 13 Years of Experience
been selected for this role due his extensive knowledge and experience in
utility rate setting and Proposition 218, and in gaining the support of the Areas of Expertise
community by educating and informing key constituents at public meetings. • Proposition 218
He will oversee the quality of work products and assure timely completion of Utility Rate Studies
•
the project. He will also provide technical oversight to the project. cost of service
Analyses
Presently, Mr. Jewett is Vice President and Group Manager of the Financial
Consulting Services group at Willdan. His background is in public Education
administration for state and local government. He specializes in fiscal • Master of Public
analysis and financial services to local agencies, including user fee and utility University ity of Delaware
Y 9 9 tY University of Delaware
rate studies. • Bachelor of Arts,
University of California,
Related Experience Santa Barbara
City of Covina: Mr. Jewett conducted a comprehensive water rate analysis
for the City of Covina. The City's water provision system includes inside City Teaching and Speaking
customers as well as customers located outside City boundaries. As part of Experience
•this analysis, Mr. Jewett developed a rate structure consisting of the Howete Setting&
How to o D Deevelop an
following charges: fixed, variable, Capital Improvement Program, and Effective
private fire protection. A unique aspect of this project included the creation Communications
Outreach Programs,"
. of a drought pricing formula to be used in times of reliance on outside water California State
sources, such as Metropolitan Water District, at a significantly higher price Municipal Finance
Officers'2006 Annual
per-acre foot than typical City sources. Mr. Jewett was also responsible for Conference
reviewing the cost allocation factor assigned to the Water Enterprise Fund to • Adjunct Lecturer,
ensure that the fund is allocated its reasonable share of indirect costs. Graduate School of
Public Administration,
City of Fountain Valley: Mr. Jewett was principal-in-charge for this project University of
to assist the City with a comprehensive water rate analysis. The City is Southern California,
2005&2006
facing higher water purchase costs and significant capital project investment
needs. The former rate structure was inadequate in providing sufficient
revenue to face these cost pressures. Our project team, led by Mr. Jewett,
developed a 10-year budget requirement analysis for the City's water utility,
identified separate fixed and commodity charges through an intensive
Proposition 218 analysis, and developed a reserve policy to provide
sufficient funding for future operational and capital needs through an
integrated planning process.
Encina Water Pollution Control Authority: The Encina Water Pollution
Control Facility is a Joint Powers Authority consisting of six city and water
district member agencies. As project manager, Mr. Jewett assisted in the
review of the allocation methodology among the user agencies and made
recommendations to the General Manager and agency board members
regarding future allocation methodologies for facility expansion projects.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
JJ
• •
WILLDA
Financial ServicNe es
Quennelle Quartararo
Project Manager— Rate Analysis
Quennelle Quartararo will serve as project manager for the City of 4 Years of Experience
Seal Beach's project. Ms. Quartararo has been selected for this
role for her extensive utility rates and fee study experience. Areas of Expertise
• Utility Rate Studies
Presently Ms. Quartararo is a Project Manager within Wilidan's Fiscal Analysis For User
•Financial Consulting Services group. She has prepared the Fees a Rates
following types of analyses: cost of service, cost allocation plan, • Impact Fee Studies
development impact fee, and utility rate. Ms. Quartararo joined the
firm in June of 2005. Education
• Master of Business
Administration, Finance
Related Experience Concentration,California
Utility Rate Studies and Impact Fees State University,
San Bernardino,CA
• City of Compton, CA: Water, Sewer, and Solid Waste Rate • Bachelor of Science,
Study Chemistry,University of
Redlands, Redlands,CA
• City of Covina, CA: Water and Wastewater Rate Studies magna cum laude
•
• City of Fountain Valley, CA: Water Rate Study AAmerican wate
Works Associati on
• East Valley Water District, CA: Water and Wastewater Rate Financial Management
Study Seminar,2005
• Phi Beta Kappa
• City of Merced, CA: Water and Sewer Rate and Impact Fee
Studies
• Town of Florence, AZ: Water, Sewer and Solid Waste Rate
and Impact Fee Studies
• City of Rio Vista, CA: Water and Sewer Rate and Impact Fee
Studies
User Fee Studies
• City of Artesia, CA: Comprehensive Fee Study
• City of San Carlos, CA: Comprehensive Fee Study
• City of Norwalk, CA: Comprehensive Fee Study
Proposal to Conduct a Water Rate Study for the City of Seal Beach
• •
WILLDAN
j financial Services
Robed W. Bowcock
Task Manager- Water Budget Feasibility Study
Mr. Bowcock is President of Integrated Resource Management, 28 Years of Experience
LLC. He will serve as the Task Manager for the feasibility study for
a water-based budget analysis. Mr. Bowcock will work with key Ciy Education
staff and report to Mr. Jewett, as well as be present at key • University of La Verne;La
meetings. Verne, CA,
Public Administration
• California State University;
Relevant Service Experience Sacramento, CA,Water
Treatment Technology
Waterniaster, 7993-present: Main San Gabriel Basin
▪ University of Southern
Watermaster. Azusa. CA; 2000-present; Chino Basin California;Los Angeles,
Waterrnaster, Rancho Cucamonga. CA CA, Hydraulic Engineering
• Appointed by California Superior Court
Licenses&Certifications
• Principal negotiator for the USEPA's largest Superfund Site • California Water Treatment
representing settlement of a $300M project. Operator Grade V
•▪ National Emerging Chemical Contaminants Chairman California e n Operator
Water Utility Manager;Azusa Light& Water(1991-1 998) Grade IV
• California State Cross
• General management of all activities for a large, full-service Connection Control
water and electric utility. Program Specialist&
Tester
• Initiated and completed acquisition and merger of large water • American Society of Civil
utility into an existing service area. Engineers Peer Reviewer
•
• Increased revenues from $3M to $12M in three years. State of California
Teaching Credential
Director of Public Works; City of Huntington Park (1987-1991)
• Directed municipal field activities, including water, streets,
parks, refuse and maintenance services divisions.
• Managed the privatization activities and contract services.
Water Treatment Plant Operator; MIND of Southern CA
(1982-1987)
• Supervised the treatment and distribution of a 600 mgd surface
water treatment plant.
• Conducted laboratory analysis.
• Conducted various engineering studies to develop cost-saving
approaches to water treatment activities.
Water Utility Worker: City of La Verne (1980-1982)
• Meter Reading, Customer Service.
• Construction and maintenance activities.
Proposal to Conduct a Water Rate Study for the City of Seal Beach
N' 2A-