PROFESSIONAL SERVICES AGREEMENTPROFESSIONAL SERVICES AGREEMENT BETWEEN
THE CITY OF CLEARWATER, FLORIDA
AND
RAFTELIS FINANCIAL CONSULTANTS, INC.
This Consulting Agreement ("Agreement") is entered into this 3,-& day of (the
"Effective Date") by and between, the City of Clearwater, FL, 100 S. Myrtle Ave, Clearwater, FL
33602 (the "Client") and Raftelis Financial Consultants, Inc., 227 W. Trade Street, Suite 1400,
Charlotte, NC 28202 ("Raftelis"), (each individually referred to herein as "Party" or collectively as
the "Parties").
Witnesseth
WHEREAS, Raftelis has substantial skill and experience in public finance, management,
and pricing, and service delivery, and
WHEREAS, The Client desires to hire Raftelis and Raftelis desires to provide services to
the Client,
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree to the terms and conditions set forth herein.
Article 1. Statement of Work
Raftelis shall provide professional consulting services of continuing utility rate and financial
services for the City's Gas utility ("Clearwater Gas System"). Raftelis will perform these services as
set forth in its proposal sent to the Client dated October 17, 2019, ("Proposal"), attached hereto and
included herein as Attachment A.
Article 2. Time for Completion
This agreement will commence at the Effective Date and remain in effect for a period of five (5)
years ("Initial Term") unless otherwise terminated as provided for herein. The Client may initiate a
five (5) year renewal, at its option, by providing Raftelis written notice no later than thirty (30) days
prior to the expiration of the Initial Term.
Article 3. Compensation
Client shall pay to Raftelis the sum not to exceed One Hundred Seventy Thousand Six -Hundred and
xx/100 ($170,600.00), which includes professional fees and direct expenses incurred in performing
the scope of services; as outlined on page 37 of the Proposal (Attachment A). The parties
understand that this sum is based upon the scope of work contained herein at Raftelis' current
standard hourly rate schedule, included on page 37 of Attachment A. Any expansion of the scope of
[GM 19-2064-094/245638/1 ]
work and related additional fees shall be subject to mutual agreement as described in Article 4,
below, and shall be by written amendment to this agreement executed by the Parties hereto.
Raftelis shall submit invoices to the Client on a monthly basis for services rendered to the date
thereof. Such invoices shall be supported by appropriate documentation; at a minimum, the task
performed, the individuals working on such task, the level of each such individual, and expenses
incurred. Each invoice will contain all hours and expenses from the Raftelis for the month. Upon
receipt of monthly invoice, the Client will remit payment to the Raftelis in accordance with the
Florida Prompt Payment Act, Chapter 218, Florida Statutes.
Article 4. Additional Services
At the Client's request, Raftelis may submit proposals for additional professional services. Each
proposal submitted shall detail: (1) scope of work for the additional services, (2) period of services
to be performed, and (3) method and amount of compensation. The Client shall provide written
acceptance and authorization to Raftelis prior to the commencement of work on any proposed
additional services. Each proposal for additional services accepted and approved by the Client shall
become part of this Agreement and shall be governed by the terms and conditions contained herein.
Article 5. Place of Performance
Raftelis shall be responsible for maintaining its own office facilities and will not be provided with
either office facilities or support by the Client.
Article 6. Indemnification
Raftelis hereby agrees to indemnify the Client and to hold the Client harmless against any and all
claims, action, or demands against the Client and against any and all damages for injury to or death
of any person and for loss of or damage to any and all property arising out of the negligent acts,
errors or omissions of Raftelis under this Agreement. Raftelis shall not be held responsible for any
claims caused by the negligence of the Client.
Article 7. Insurance
Raftelis shall maintain the types and levels of insurance during the life of this Agreement as
specified in RFP #58-19, Detailed Specifications, paragraph 6 (incorporated by reference as if set
forth herein).
Article 8. Confidential Information/Public Records
Raftelis acknowledges and agrees that in the course of the performance of the services pursuant to
this Agreement, Raftelis may be given access to, or come into possession of, confidential
information from the Client, of which information may contain privileged material or other
confidential information. Raftelis acknowledges and agrees, except if required by law, judicial or
administrative order, trial, or other governmental proceeding pertaining to this matter, that it will
not use, duplicate, or divulge to others any such information belonging to or disclosed to Raftelis by
the Client without first obtaining written permission from the Client. All tangible embodiments of
such information shall be delivered to the Client by Raftelis upon termination hereof, or upon
request by the Client, whichever occurs first. The Client acknowledges Raftelis has the right to
[GM 1 9-2064-094/245 63 8/1 ]
maintain its own set of work papers which may contain confidential information. The Parties
acknowledge that the above is subject to Florida's broad public records law, including Chapter 119,
Florida Statutes.
Public Records:
In addition to all other contract requirements as provided by law, the contractor executing this
agreement agrees to comply with public records law.
IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER
119, FLORIDA STATUTES, TO THE CONTRACTOR'S DUTY TO PROVIDE PUBLIC
RECORDS RELATING TO THIS CONTRACT, CONTACT THE CUSTODIAN OF PUBLIC
RECORDS AT: 727-562-4092, Rosemarie.Call@myclearwater.com, 112 S. Osceola Ave.,
Clearwater, FL 33756.
The contractor's agreement to comply with public records law applies specifically to:
a) Keep and maintain public records required by the City of Clearwater (hereinafter "public
agency") to perform the service being provided by the contractor hereunder.
b) Upon request from the public agency's custodian of public records, provide the public
agency with a copy of the requested records or allow the records to be inspected or copied
within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119,
Florida Statutes, as may be amended from time to time, or as otherwise provided by law.
c) Ensure that the public records that are exempt or confidential and exempt from public
records disclosure requirements are not disclosed except as authorized by law for the
duration of the contract term and following completion of the contract if the contractor does
not transfer the records to the public agency.
d) Upon completion of the contract, transfer, at no cost, to the public agency all public records
in possession of the contractor or keep and maintain public records required by the public
agency to perform the service. If the contractor transfers all public records to the public
agency upon completion of the contract, the contractor shall destroy any duplicate public
records that are exempt or confidential and exempt from public records disclosure
requirements. If the contractor keeps and maintains public records upon completion of the
contract, the contractor shall meet all applicable requirements for retaining public records.
All records stored electronically must be provided to the public agency, upon request from
the public agency's custodian of public records, in a format that is compatible with the
information technology systems of the public agency.
e) A request to inspect or copy public records relating to a public agency's contract for services
must be made directly to the public agency. If the public agency does not possess the
requested records, the public agency shall immediately notify the contractor of the request
and the contractor must provide the records to the public agency or allow the records to be
inspected or copied within a reasonable time.
f) The contractor hereby acknowledges and agrees that if the contractor does not comply with
the public agency's request for records, the public agency shall enforce the contract
provisions in accordance with the contract.
[GM19-2064-094/245638/1]
g)
A contractor who fails to provide the public records to the public agency within a reasonable
time may be subject to penalties under Section 119.10, Florida Statutes.
h) If a civil action is filed against a contractor to compel production of public records relating
to a public agency's contract for services, the court shall assess and award against the
contractor the reasonable costs of enforcement, including reasonable attorney fees, if:
1. The court determines that the contractor unlawfully refused to comply with the
public records request within a reasonable time; and
2. At least 8 business days before filing the action, the plaintiff provided written
notice of the public records request, including a statement that the contractor has not
complied with the request, to the public agency and to the contractor.
i) A notice complies with subparagraph (h)2. if it is sent to the public agency's custodian of
public records and to the contractor at the contractor's address listed on its contract with the
public agency or to the contractor's registered agent. Such notices must be sent by common
carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with
postage or shipping paid by the sender and with evidence of delivery, which may be in an
electronic format.
A contractor who complies with a public records request within 8 business days after the notice is
sent is not liable for the reasonable costs of enforcement.
Article 9. Independent Contractor Status
It is understood and agreed that Raftelis will provide the services under this Agreement on a
professional basis as an independent contractor and that during the performance of the services
under this Agreement, Raftelis' employees will not be considered employees of the Client within
the meaning or the applications of any federal, state, or local laws or regulations including, but not
limited to, laws or regulations covering unemployment insurance, old age benefits, worker's
compensation, industrial accident, labor, or taxes of any kind. Raftelis' employees shall not be
entitled to benefits that may be afforded from time to time to Client employees, including without
limitation, vacation, holidays, sick leave, worker's compensation, and unemployment insurance.
Further, the Client shall not be responsible for withholding or paying any taxes or social security on
behalf of Raftelis' employees. Raftelis shall be fully responsible for any such withholding or
paying of taxes or social security.
Article 10. Reliance on Data
In performance of the services, it is understood that the Client and/or others may supply Raftelis
with certain information and/or data, and that Raftelis will rely on such information. It is agreed
that the accuracy of such information is not within Raftelis' control and Raftelis shall not be liable
for its accuracy, nor for its verification, except to the extent that such verification is expressly a part
of Raftelis' scope of services.
[GM I9-2064-094/245638/1 ]
Article 11. Opinions and Estimates
Raftelis' opinions, estimates, projections, and forecasts of current and future costs, revenues,
other levels of any sort, and events shall be made on the basis of available information and Raftelis'
expertise and qualifications as a professional. Raftelis does not warrant or guarantee that its
opinions, estimates, projections or forecasts of current and future levels and events will not vary
from the Clients's estimates or forecasts or from actual outcomes. Raftelis identifies costs, allocates
costs to customer classes and provides rate models. It does not establish rates, which is the
legislative responsibility of the Client.
Article 12. No Consequential Damages
To the fullest extent permitted by law, neither party shall be liable to the other for any
special, indirect, consequential, punitive or exemplary damages resulting from the performance or
non-performance of this Agreement notwithstanding the fault, tort (including negligence), strict
liability or other basis of legal liability of the party so released or whose liability is so limited and
shall extend to the officers, directors, employees, licensors, agents, subcontractors, vendors and
related entities of such party.
Article 13. Termination of Work
This Agreement may be terminated as follows:
1. By Client (a) for its convenience on 30 days' notice to Raftelis, or (b) for cause, if Raftelis
materially breaches this Agreement through no fault of Client and Raftelis neither cures such
material breach nor makes reasonable progress toward cure within 15 days after Client has
given written notice of the alleged breach to Raftelis.
2. By Raftelis (a) for cause, if Client materially breaches this Agreement through no fault of
Raftelis and Client neither cures such material breach nor makes reasonable progress toward
cure within 15 days after Raftelis has given written notice of the alleged breach to Client, or (b)
upon five days' notice if Work under this Agreement has been suspended by either Client or
Raftelis in the aggregate for more than 30 days.
3. Payment upon Termination. In the event of termination, Raftelis shall be compensated for all
work performed prior to the effective date of termination. Upon termination, Raftelis shall turn
over to Client all work product that is the result of performing its services hereunder.
Article 14. Notices
All notices required or permitted under this Agreement shall be in writing and shall be deemed
deliverable when delivered in person or deposited in the United States mail, postage prepaid,
addressed as follows:
If for the Client:
Mr. Brian Jay Ravins
Finance Director
100 South Myrtle Avenue, Clearwater, FL 33756
[GM 19-2064-094/245638/ 1 ]
If for RFC:
Mr. J. Bart Kreps
Vice President
Raftelis Financial Consultants, Inc.
227 W. Trade Street
Suite 1400
Charlotte, NC 28202
Article 15. Compliance with Applicable Laws
Raftelis agrees not to discriminate in its employment practices and will render services under this
Agreement without regard to race, color, religion, sex, national origin, veteran status, political
affiliation or disabilities.
Any act of discrimination committed by Raftelis, or failure to comply with these statutory
obligations when applicable, shall be grounds for termination of this Agreement.
Article 16. General Provisions
A. Entire This Agreement, together with any other documents incorporated herein by
Agreement: reference and all related Exhibits, constitutes the sole and entire agreement
of the Parties with respect to the subject matter of this Agreement and
supersedes all prior and contemporaneous understandings, agreements, and
representations and warranties, both written and oral, with respect to such
subject matter. In the event of any inconsistency between the statements
made in the body of this Agreement, the related Exhibits, and any other
documents incorporated herein by reference, the following order of
precedence governs: (a) first, this Agreement including Exhibits; (b) second,
the RFP documents; and (c) third, any other documents incorporated herein
by reference.
B. Waiver:
[GM 19-2064-094/245 63 8/ 1 ]
The failure of either Party to require performance by the other of any
provision hereof shall in no way affect the right to require performance at
any time thereafter, nor shall the waiver of a breach of any provision hereof
be taken to be a waiver of any succeeding breach of such provision or as a
waiver of the provision itself. All remedies afforded in this Agreement shall
be taken and construed as cumulative; that is, in addition to every other
remedy available at law or in equity.
C. Relationship:
D. Assignment
and
Delegation:
E. Severability:
F. Governing
Law:
G. Paragraph
Headings:
H. Third Party
Rights
Nothing herein contained shall be construed to imply a joint venture,
partnership, or principal -agent relationship between Raftelis and the Client;
and neither Party shall have the right, power, or authority to obligate or bind
the other in any manner whatsoever, except as otherwise agreed to in
writing.
Neither Party shall assign or delegate this Agreement or any rights, duties, or
obligations hereunder without the express written consent of the other.
Subject to the foregoing, this Agreement shall inure to the benefit of and be
binding upon the successors, legal representatives, and assignees of the
Parties hereto.
If any provision of this Agreement is declared invalid or unenforceable, such
provision shall be deemed modified to the extent necessary and possible to
render it valid and enforceable. In any event, the unenforceability or
invalidity of any provision shall not affect any other provision of this
Agreement, and this Agreement shall continue in force and effect, and be
construed and enforced, as if such provision had not been included, or had
been modified as above provided, as the case may be.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Florida.
The paragraph headings set forth in this Agreement are for the convenience
of the Parties, and in no way define, limit, or describe the scope or intent of
this Agreement and are to be given no legal effect.
Nothing in this Agreement shall be construed to create or confer any rights
or interest to any third party or third -party beneficiary. It is the intent of the
parties that no other outside, non-party claimant shall have any legal right to
enforce the terms of this Agreement.
Article 17. Disclosures
As a registered Municipal Advisor under the Dodd -Frank Act, Raftelis is required to inform our
clients of any existing or potential conflicts of interest that may be relevant to any proposed
scope of services that may include providing "advice" as that term is defined in the Dodd -Frank
Act. As of the date of this engagement letter, no conflicts of interest are known to exist.
Under the Dodd -Frank Act the definition of "advice" includes providing any opinion,
information or assumptions related to the size, timing and terms of possible future debt issues or
borrowing. This type of information may be integrated into the capital and financial planning
components of a rate study. This definition is applicable regardless of whether this information
is developed and used solely for planning and decision-making purposes. For the services
addressed in the scope of work identified for this engagement, any information that is developed
by Raftelis that falls under this definition of municipal advice is not intended to represent a
[GM 19-2064-094/245638/1 ]
recommendation that the City should issue debt based on the terms and assumptions used to
develop the financial plan or forecast, or that the City will, in fact, be able to issue debt under
the exact terms and conditions assumed and used to develop the financial plan or forecast. The
information developed as part of this rate study, including any related municipal advice, is
intended only to provide information useful in evaluating the potential impact on the utility and
future rate adjustments of one potential course of action for the City. If the City decides at some
future date to issue debt, then at that time the City will need to engage an independent,
registered Financial Advisor to assist in evaluating the availability of different types of debt, and
the specific terms and conditions for issuing debt, which will be affected by market conditions
and the City's credit rating at the time of issuance. At that time, as a registered Municipal
Advisor, Raftelis can also provide additional assistance related to a specific bond or debt issue,
such as preparing a bond feasibility report or financial forecast for inclusion in bond documents,
without requiring additional oversight or supervision by the Financial Advisor.
By signing this contract the City is indicating its approval and acceptance of the of the proposed
scope of work and fees, the City is also explicitly acknowledging that Raftelis has provided the
necessary disclosures addressing conflicts of interest and any limitations on the scope of
Municipal Advisory services to be provided by Raftelis' part of this engagement.
[GM 19-2064-094/245638/1 ]
IN WITNESS WHEREOF, the Parties have executed this Agreement by their duly authorized
representatives.
Raftelis Financial Consultants, Inc.
By:
Presje*
Countersigned:
George N. Cretekos
Mayor
Approved as to form:
Laura Mahony
Assistant City Attorney
[GM19-2064-094/245638/1]
By:
CITY OF CLEARWATER, FLORIDA
Attest:
B. Horne II
ty Manager
rtitertl9-X(41(
*eAuKakti Oat
Rosemarie Call
City Clerk
Attachment A — Statement of Work/Engagement Letter
[ GM 19-2064-094/24563 8/ 1 ]
RAFTEL S
Utility Rate Study Services - Gas Utility System
PROPOSAL / RFP #58-19 / OCTOBER 17, 2019 / COPY
City of
111
REGISTERED
MUNICIPAL
ADVISOR
Registration as a Municipal Advisor is a requirement under the Dodd -Frank Wall Street
Reform and Consumer Protection Act. All firms that provide financial forecasts that include
assumptions about the size, timing, and terms for possible future debt issues, as well as
debt issuance support services for specific proposed bond issues, including bond feasibility
studies and coverage forecasts, must be registered with the SEC and MSRB to legally
provide financial opinions and advice. Raftelis' registration as a Municipal Advisor means
our clients can be confident that Raftelis is fully qualified and capable of providing financial
advice related to all aspects of utility financial planning in compliance with the applicable
regulations of the SEC and the MSRB.
Table of
Contents
01
Letter of Transmittal
*43
Experience and Qualifications
Project Approach, Methodology,
and Schedule for Completion
References
Cost of Services
Other Forms
This page intentionally left blank to facilitate two-sided printing
LETTER OF TRANSMITTAL
RAFTELIS
October 16, 2019
City of Clearwater
Purchasing Office
100 S. Myrtle Ave., 3rd Floor
Clearwater, FL 33756
Subject: Proposal for Utility Rate Study Services - Gas Utility System (RFP #58-19)
Dear Members of the Selection Committee:
Raftelis in association with Tom Sullivan of Navillus Utility Consulting, LLC (Navillus) (together, the Raftelis Team) are
pleased to submit this proposal to conduct a natural gas rate study for the City of Clearwater (City). We believe that our
unique combination of qualifications, experience, and resources will ensure a value-added project that will benefit the City
and its customers.
With a combination of one of the country's leading governmental utility rate and financial planning practices and Navillus'
extensive experience working previously with the City and in the natural gas sector, we offer the City maximum value for
several key reasons, including:
• We have unparalleled experience providing similar services to numerous utilities in Florida, throughout the Southeast, and
across the country.
• We can deliver efficient and effective solutions by leveraging Navillus' natural gas pricing experience and Raftelis' vast
resources as it relates to utility financial planning, cost of service, and rate design.
• Raftelis is registered with the U.S. Securities and Exchange Commission (SEC) and the Municipal Securities Rulemaking
Board (MSRB) as a Municipal Advisor. This registration is a requirement under the Dodd -Frank Wall Street Reform and
Consumer Protection Act and is necessary to provide advice on the timing and size of future debt issuance, which would be
critical for any future debt issuances the City may need to pursue.
Raftelis was established in 1993 to provide financial, rate, and management consulting services of the highest quality to gov-
ernmental utilities. Raftelis has the largest and most experienced utility rate and financial consulting practice in the country.
No one in the industry can equal Raftelis' combination of size, efficiencies, and corporate independence. Our mission has
always been focused on assisting our clients from an objective viewpoint as we have no "stake" in the scope and depth of a
utility's capital investments and are, thus, able to avoid potential conflicts of interest.
Navillus is a utility management consulting firm established in 2011 by Tom Sullivan. Mr. Sullivan has experience providing
management and financial consulting services to both public and private natural gas, electric, water, and wastewater utilities.
The services provided by Navillus include revenue requirements, rates and cost of service, depreciation rate analysis, utility
accounting, valuation, financial and economic feasibility, contract negotiation (both supplier and customer), demand and
supply analysis, debt issuance support, and expert witness testimony.
341 N. Maitland Avenue, Suite 300
Maitland, FL 32751
01
07. CITY OF CLEARWATER
To assist the City on this project, we have selected a team with extensive experience and a reputation for quality service. I
will serve as Project Manager and will be responsible for managing the day-to-day aspects of the project to ensure it is within
budget, on schedule, and achieves the City's objectives. I have been with Raftelis since 2002, am a Municipal Advisor Princi-
pal, and manage numerous projects throughout the Southeast in helping utilities address economic and financial issues. Mr.
Sullivan will serve as a Technical Advisor on various cost of service and rate design elements of the study. Collin Drat will lead
project analytics and provide oversight to staff. Staff support will be provided out of our office in Maitland, FL. Henry Thomas
will also serve as a Technical Advisor. Mr. Thomas has more than 40 years of experience providing utility rate and financial
planning services predominantly in Florida.
We are proud of the resources that we can offer and welcome the opportunity to assist to the City in this engagement. Should
you have any questions, please do not hesitate to contact me using the contact information below.
Bart Kreps, Vice President
227 W. Trade Street, Suite 1400, Charlotte, NC 28202
Office: 704.936.4438 / Mobile: 704.968.3278 / Email: bkreps@raftelis.com
Very truly yours,
cif.7t'/
Bart Kreps
Vice President
341 N. Maitland Avenue, Suite 300
Maitland, FL 32751
EXPERIENCE AND QUALIFICATIONS
WHO IS
Rafte
RAFTE! !S THE
TRUSTE ADVISOR
x
Visit www.raftelis.com to learn more
Raftelis provides utilities and public -
sector organizations with insights
and expertise to help them operate
as high -performing, sustainable
entities providing essential services
to their citizens. We help our clients
solve their finance, organizational,
and technology challenges, achieve
their objectives, and, ultimately, make
their communities better places to
live, work, and play.
03
y �t
On July 1, 2019, Raftelis acquired PRMG. The entire PRMG staff is now
part of the Raftelis family. Over the past 25 years, PRMG and Raftelis
have followed similar paths—focusing on delivering lasting business
solutions for public -sector agencies. The combination of our two firms
provides our clients with the capabilities and resources of Raftelis, the
nation's largest and most experienced practice focused on financial
and management consulting for public -sector utilities, coupled with
the regional insights and understanding of PRMG, Florida's leading
utility financial, rate, and business solutions consultancy. You will now
have the expertise of more than 100 of the country's leading utility
and public -sector consultants, including many of the nation's foremost
authorities in finance and rates, along with additional capabilities in the
areas of organizational and management consulting, data and technol-
ogy services, and communication and public outreach, to help address
your most challenging issues. We know that our combined capabilities
and resources will provide added value to the City, and we're looking
forward to what we can accomplish together.
THE CITY
& RAFTELIS
The
Right
Fit
CITY OF CLEARWATER
O O RESOURCES & EXPERTISE
This project will require the resources
V necessary to effectively staff the project and
the skillsets to complete all of the required
components.
With more than 100 consultants, Raftelis has the largest public -
sector utility financial and rate consulting practice in the nation.
Our depth of resources will allow us to provide the City with the
technical expertise necessary to meet your objectives. In addition
to having many of the industry's leading rate consultants, we also
have experts in key related areas, like stakeholder engagement
and data analytics, to provide additional insights as needed.
When your Board and customers are
considering the validity and merit of
recommended changes, they want to be
confident that they were developed by experts
using the latest industry standard methodology.
Our senior staff are involved in shaping industry standards by
chairing various committees within the American Water Works
Association (AWWA) and the Water Environment Federation
(WEF). Raftelis' staff members have also co-authored many
industry standard books regarding utility finance and rate setting.
Being so actively involved in the industry will allow us to keep the
City informed of emerging trends and issues, and to be confident
that our recommendations are insightful and founded on sound
industry principles. In addition, with Raftelis' registration as a
Municipal Advisor, you can be confident that we are fully qualified
and capable of providing financial advice related to all aspects of
utility financial planning in compliance with federal regulations.
CS CITY OF CLEARWATER
City of Mascotte
City of Melbourne
City of Miami Beach
City of Miramar
Town of Oakland
Oakland Park
City of Ocala
City of Oldsmar
City of Orlando
City of Oviedo
Town of Palm Beach
Village of Palm Springs
City of Panama City
Pinellas County
City of Plant City
City of Pompano Beach
City of Port St. Lucie
St. Johns County
City of Sanford
Sarasota County
South Walton Utility Co., Inc.
City of Sunrise
Village of Tequesta
Tohopekaliga Water Authority
City of Tampa
City of Tavares
Volusia County
Village of Wellington
City of West Palm Beach
City of Wilton Manors
City of Winter Haven
City of Zepyrhills
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RAFTELIS OS
HISTORY OF SIMILAR SUCCESSES
An extensive track record of past similar work will help
to avoid potential pitfalls on this project and provide
the know-how to bring it across the finish line.
Raftelis staff have assisted 1,000+ utilities throughout the U.S. with financial
and rate consulting services, with wide-ranging needs and objectives. Our
extensive experience along with Navillus' experience in the natural gas sector
will allow us to provide innovative and insightful recommendations to the
City and will provide validation for our proposed methodology ensuring that
industry best practices are incorporated.
USER—FRIENDLY tsIODELIFIG
A modeling tool that your staff can use for scenario
analysis and financial planning now and into the future
will be key for the City going forward.
Raftelis has developed some of the most sophisticated yet user-friendly
financial/rate models available in the industry. Our models are tools that allow
us to examine different policy options and cost allocations and their financial/
customer impacts in real time. Our models are non-proprietary and are
developed with the expectation that they will be used by the client as a financial
planning tool long after the project is complete.
For the study to be a success, rates must be successfully
approved and implemented.
Even the most comprehensive rate study is of little use if the recommendations
are not approved and implemented. Raftelis has assisted numerous agencies
with getting proposed rates successfully adopted. We develop a message
regarding the changes that is politically acceptable and convey that message
in an easy -to -understand manner. We focus on effectively communicating
with elected officials about the financial consequences and rationale behind
recommendations to ensure stakeholder buy -in and successful rate adoption.
06 CITY OF CLEARWATER
Experience
RAFTELIS HAS THE MOST
!7:',XPE14,1ENCED MUNICIPAL UTILITY
!TAN CFAL AND !--',,--1ANAngEt4E
DM5LILTING PRACTICE THE NATIO
Our staff have assisted more than 1,000 utilities across the
U.S., including some of the largest and most complex agencies
in the nation. In the past year alone, Raftelis worked on more
than 600 financial/organizational/technology consulting
projects for over 400 water, wastewater, and/or stormwater
utilities in 40 states, the District of Columbia, and Canada.
11,
'6, a
. 4.*
Raftelis has provided
financial/organizational/
technology assistance to
utilities serving more than
of the U.S. population.
RAFTELIS 07
FLORIDA EXPERIENCE
The Raftelis team has extensive
experience serving Florida public
sector agencies. This matrix shows
some of the Florida public -sector
entities/utilities that the Raftelis
team have served.
6upHd Is sepnls aleti
City of Alachua 6
City of Arcadia 0
City of Auburndale 4,
Babcock Ranch Community
Independent Special District (BRCISD)
Boca Raton * *
Bonita Springs Utilities 0 *
City of Cape Canaveral 0 a
Charlotte County 6 6.
City of Clermont 4 6 6
Collier County 0 6 V a
City of DeLand
City of Davie
Destin Water Users
City of Edgewater
City of Eustis
Florida Keys Aqueduct Authority
Town of Fort Myers Beach 0
City of Fort Walton Beach
City of Groveland
Hernando County , 6
Hillsborough County
Indian River County
Village of Islamorada
Town of Jupiter
Town of Lauderdale -by -the -Sea
City of Lake Alfred
City of Largo
City of Lake Wales
Lee County
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Manatee County
City of Marathon
City of Margate
Martin County
RAFTELIS
0
Project Team
WE HAVEDEVELOPEDA
TEAM OF CONSUL,` :NTS
WHO SPECIALIZE IN THE
SPECIFIC ELEMENTS
THAT WILL BE C :I "y
TO THE SUCCESS OF
THE CITY'S PROJECT.
CITY OF
CLEARWATER
Bart Kreps
Collin Drat
Raftelis is the nation's largest and most experienced practice focused on
financial and management consulting for public sector utilities. We have
been providing utilities and public sector organizations with insights
and expertise to help solve finance, organizational, communication, and
technology challenges for over 40 years. Our partnership with Navillus
Consulting leverages these resources with over 35 years of experience
providing rate, financial, and management consulting in the natural
gas sector. Raftelis and Navillus have collaborated successfully on
numerous engagements to provide maximum value to the client. Project
Team members including Bart Kreps, Project Manager; Tom Sullivan,
Natural Gas Cost technical advisor; and Collin Drat, Lead Consultant
have developed a strong working relationship and a proven track -record
for delivering comprehensive solutions with exceptional client service.
TECHNICAL ADVISO
Henry Thomas
-,N
• Tom Sullivan Jr., PE
Our team includes senior -level professionals to provide
experienced project leadership with support from talented
consultant staff. This close-knit group has frequently
collaborated on similar successful projects, providing the
City with confidence in our capabilities.
Here, we have included an organizational chart showing the
structure of our project team. On the following pages, we
have included detailed resumes and project roles for each of
our team members.
ra
SPECIALTIES
Utility cost of service and rate
studies
• Bond forecasts and feasibility studies
• Capital financing plan development
• Development and impact fee studies
Economic feasibility studies
Regionalization studies
Alternative project delivery studies
PROFESSIONAL HISTORY
Raftelis: Vice President
(2018 -present); Senior Manager
(2014-2017); Manager (2010-2013);
Senior Consultant (2005-2009);
Staff Consultant (2002-2004)
Wells Fargo Securities: Fixed Income
Analyst (1998-2000)
EDUCATION
Master of Business Administration
in Finance & Environmental
Management - The University of
Tennessee (2002)
Bachelor of Business Administration
in Finance - James Madison
University (1998)
PROFESSIONAL MEMBERSHIPS
North Carolina AWWA
Tennessee/Kentucky AWWA
Virginia AWWA
Virginia AWWA/WEF Utility
Management Committee - Financial
Management Subcommittee lead
CERTIFICATIONS
Series 50 Municipal Advisor
Representative
Series 54 Municipal Advisor Principal
CITY OF CLEARWATER
,. r _:: ;r s
Project Manager
Vice President (Raftelis)
ROLE; Will serve as Project Manager and will manage the day-to-day aspects of
the project ensuring it is within budget, on schedule, and effectively meets the City's
objectives. He will also lead the consulting staff in conducting analyses and preparing
deliverables for the project.
PROFILE:: Mr. Kreps has been with Raftelis since 2002, managing a variety of projects
to assist water, wastewater, stormwater, and natural gas utilities in addressing economic
and financial issues. Key areas of focus include: utility rate, cost of service, and financial
planning studies; capital financing plan development; bond forecast and feasibility stud-
ies; economic impact assessments; and system development fees studies. Mr. Kreps has
extensive experience in financial forecasting and modeling including the application of
advanced techniques in risk management. Mr. Kreps' background is focused predom-
inantly on public finance. He has assisted many utilities in designing optimal capital
financing plans and has developed numerous financial feasibility reports and forecasts
related to more than $1 billion in revenue bond sales. Mr. Kreps is the current lead of
the Virginia AWWA/WEA Financial Management Subcommittee. He also authored a
chapter entitled, "Evaluating Risk in Capital Planning, Financing, and Rate Setting,"
for the Fourth Edition of the industry guidebook, Water and Wastewater Finance and
Pricing: The Changing Landscape. Prior to joining Raftelis, Mr. Kreps served as fixed
income analyst for Wells Fargo Securities, in the company's Capital Markets Group.
11, a s ) t",ICE
City of Clarksville (TN)
Raftelis in conjunction with Navillus Utility Consulting, LLC (the project team) prepared
financial planning, cost of service, and rate design analyses for the City of Clarksville's
(City) natural gas utility. A key driver of the study was the anticipated construction of
the Texas Gas Pipeline interconnect. The project team evaluated gas revenues at exist-
ing rates and determined the adjustments required to ensure the City would continue
to meet its debt covenants following the issuance of the debt for the project. Another
critical aspect of the project involved forecasting demand for the City's various customer
classes. The project team evaluated recent years of historical natural gas demand as well
as historical heating degree days to develop a normalized usage forecast to inform the
financial plan and cost of service study.
Raftelis has also provided similar services for the City's water and wastewater utilities.
City of Cookeville (TN)
Mr. Kreps served as Project Manager on a water, wastewater, and natural gas rate and
financial planning study for the City of Cookeville, Tennessee. The study was designed to
address a number of financial and pricing objectives including, in particular, recommen-
dations for cost justified rates that fully support system operations and maintenance, asset
repair and replacement, debt service, and debt service coverage requirements. Additional
recommendations were also provided related to water and wastewater capacity charges
that support growth related projects to ensure that new customers are making an equita-
ble contribution toward the capital investment in the capacity to accommodate growth.
Mr. Kreps also developed a rate and financial planning model to forecast annual revenue
requirements and rates over a five-year planning period.
RAFTELIS
City of Richmond (VA)
In 2007, Mr. Kreps managed the development of a comprehen-
sive rate and financial planning model (Model) for the City of
Richmond Department of Public Utilities (DPU). The Model
incorporates all utility systems: water, wastewater, natural gas,
street lighting, and stormwater. DPU currently uses the Model to
set rates, determine optimal capital financing scenarios, and report
on utility system financial conditions. The financial planning
output from includes a projection of units of service (customer
accounts and usage), operating expenses and capital expenditures,
as well as a projection of net revenues available for debt service
and debt service coverage. The Model provides the flexibility to
evaluate the impacts of various capital funding sources includ-
ing revenue bonds, general obligation bonds, Virginia Resource
Authority (VRA) loans, and grants.
In 2010, Mr. Kreps managed a comprehensive cost of service study
for the DPU's natural gas, water, wastewater, stormwater, and
natural gas utilities. The results of the study included numerous
recommended rate structure changes to better align DPU's rates
and charge with its pricing objectives. A comprehensive affordabil-
ity analysis was also conducted resulting in the recommendation
and implementation of several customer assistance programs. Mr.
Kreps currently provides the DPU with various rate, financial, and
management services on an ongoing basis.
City of Akron (OH)
In 2013, the City of Akron (City) engaged Raftelis to perform a
comprehensive cost of service, rate design, and financial plan-
ning study to assist them in managing the costs related to their
combined sewer overflow (CSO) consent decree. Mr. Kreps is the
Project Manager for this engagement and prepared the financial
and rate model used to project the City's operating and capital
financing requirements over a 30 -year horizon. This engagement
included detailed analysis of customer bill impacts arising from
various rate structure alternatives and capital financing scenarios.
Subsequent to this study, the City opened a dialogue with the EPA
to utilize integrated planning in meeting regulatory requirements.
Franklin County (OH)
Mr. Kreps served as Project Manager for an engagement to assist
the Franklin County (County) Department of Sanitary Engineering
(FCSE) with a utility structure, operations, cost of service, and water
and wastewater rate analysis. As a result of an expansive geographic
service area and limited economies of scale, FCSE is facing a number
of challenges in limiting the cost of providing utility services. FCSE
is also faced with significant capital investment needs over the next
10 years to ensure continued and reliable services. Raftelis worked
with FCSE to develop a 10 -year financial plan and recommended
rates that are consistent with industry pricing standards and fully
support system operations and maintenance, asset repair and
replacement, debt service, and debt service coverage requirements.
Raftelis is also conducted an operational assessment to evaluate the
efficiency and effectiveness of the organization, as well as an evalu-
ation of the current strengths and weaknesses of the existing utility
structure and alternative options for consideration.
City of Buffalo (NY)
Mr. Kreps provided financial advisory services for a comprehensive
cost of service and rate study for the Buffalo Water Board (Board).
The Board's primary pricing objectives were revenue sufficiency
and equitable cost recovery from all customer classes. To achieve
these objectives, Mr. Kreps performed a cost of service study and
developed two alternatives to the existing three -tiered, declining
block rate structure. The results of the cost of service study indi-
cated that the discount being realized by large volume customers
was not cost -justified and that only a minor portion of consump-
tion was within the middle rate block. Mr. Kreps recommended a
phased approach to bringing the discount for consumption in the
third rate block closer to a cost -justified level and phasing out the
middle rate block. Both the Board and the City's Common Council
unanimously approved the recommendations.
Hallsdale-Powell Utility District (TN)
Mr. Kreps has served as Project Manager on many engagements for
the Hallsdale-Powell Utility District (HPUD) in Knoxville, Ten-
nessee. HPUD has faced significant challenges related to capital
infrastructure repair and replacement to meet the demands of its
growing system. Mr. Kreps developed a water and wastewater rate
model that has served as a financial planning tool for the District
over the past 12 years. The model was designed to evaluate a variety
of financing assumptions and operating scenarios with the ultimate
goal of recommending an appropriate program of rate adjustments
to meet HPUD's projected revenue requirements. Most recently,
Mr. Kreps developed the financial forecast and opinion letter for
inclusion in HPUD's Series 2006 and Series 2008 Revenue Bonds,
as well as a Rural Utility Service loans in both 2009, 2011, and 2014.
York County (SC)
Mr. Kreps served as Project Manager on several studies for York
County, South Carolina (County). Initially, the County engaged
Raftelis to calculate a wholesale or bulk rate for water purchased
by the City of York and Tega Cay from the City of Rock Hill to
be delivered through the County transmission system. Mr. Kreps
developed a cost allocation methodology and associated rate for
delivering water through the County system that considered alter-
native options for the assessment of capital costs. Mr. Kreps also
provided direction related to developing the contractual agree-
ment that will govern these transmission services provided by the
County. In 2017, Mr. Kreps assisted the County with a compre-
hensive water and wastewater rate and financial planning study.
The study involved development of projected revenues and reve-
nue requirements over a 10 -year period. Recommendations also
included various changes to the County's water and wastewater
retail rate structure.
Watauga Regional Water and Sewer Authority (TN)
Mr. Kreps served as Lead Consultant on an engagement with the
Watauga Regional Water and Sewer Authority (WRRWA). The
WRRWA commissioned Raftelis to conduct a study to evaluate
the economic impact of designing, engineering, and constructing
a regional water treatment facility and associated transmission
system. Mr. Kreps developed an economic feasibility model that
12 CITY OF CLEARWATER
evaluated both the unit cost impact and average customer bill
impact of two regional plan alternatives. Mr. Kreps, in association
with a national engineering firm, assessed both the quantitative
and qualitative impacts of both alternatives, which ultimately lead
to the selection and recommendation of a preferred regional plant
alternative.
White House Utility District (TN)
Mr. Kreps served as Project Manager on many engagements for
the White House Utility District, Tennessee (WHUD). Mr. Kreps
has conducted numerous water and wastewater rate and financial
planning studies consisting of defining and evaluating the existing
and projected cost basis for utility operations, allocating costs based
on cost of service principles, and recommending updated water and
wastewater fees for retail customers. Mr. Kreps also assisted WHUD
with an evaluation of the appropriateness of its existing rate meth-
odology for charging water service on a wholesale basis. Mr. Kreps
participated in discussions with WHUD's wholesale water customer
to re -negotiate a rate that was both reasonable and equitable.
City of Johnson City (TN)
Mr. Kreps served as Lead Consultant for the City of Johnson City
(City) in developing a ten-year financial plan and program of water
and wastewater rate adjustments to meet the anticipated require-
ments of a substantial wastewater capital improvements plan. The
City had not adjusted its water or wastewater rates in approxi-
mately ten years when it engaged Raftelis in 2003. Previously,
the City had employed a short-term (one-year) planning process
which implemented rate adjustments in reaction to annual capital
and budget requirements. As part of our assistance, Raftelis rec-
ommended modifications to the City's water and wastewater rate
structures to eliminate the minimum usage allowances and intro-
duce base charges for both water and wastewater. Additionally,
Raftelis developed a plan to gradually eliminate the declining block
wastewater volume rates by consolidating the declining block rates
into one uniform volume wastewater rate over a ten-year period.
The elimination of the declining blocks was recommended to pro-
vide more consistency with current industry rate -setting practices
as the recent decline in the City's manufacturing and industrial
customer base no longer warranted a rate structure that provided
incentives for large industrial wastewater users.
The elimination of the declining blocks also allowed the City to
phase out the current subsidy provided from the water utility
to the wastewater utility and move towards a more financially
self-sufficient wastewater utility. Other recommendations involved
implementation of a consistent outside -city differential for all rates
and charges assessed to outside -city water and wastewater cus-
tomers, and developing a program of rates and charges that would
achieve a target level of debt service coverage of 1.20x in order to
protect the utility's financial position and access to debt markets.
Raftelis also worked with the City to determine the appropriate
costs for providing potable water to wholesale customers under the
Utility Approach to rate -setting and provided sample calculations
of wholesale water rates for two potential types of wholesale cus-
tomer contracts. These customer types included a customer who
would not require City water services on a consistent basis and a
customer who would require City water services as its primary
source of water and would agree to "buy -in" to a portion of the
City's available capacity.
Raftelis has been engaged by the City in 2007, 2008, 2009, 2014, and
2017 to update the rate and financial planning model.
Paulding County (GA)
Paulding County (County) is located in northwest Georgia with an
estimated population of 148,232. The County is part of the Atlanta
Metropolitan Area. Water service is provided to approximately
43,000 customers through a network of distribution infrastruc-
ture. Potable water is currently purchased on a wholesale basis
from the Cobb County -Marietta Water Authority (CCMWA).
Mr. Kreps served as Project Manager assisting the County with
a financial and economic impact analysis of the Richland Creek
Water Supply Project, which will supplement the current wholesale
water purchases and eventually supply up to 35 million gallons per
day (MGD) of the County's long-term (50 -year) need of 53 MGD
supporting a population of 500,000. Raftelis was engaged by the
County to conduct a detailed examination and evaluation of the
Richland Creek Water Supply Project to determine the most advan-
tageous strategy for financing and delivering the project. The major
components of the analysis included the determination of a capital
financing plan and development of an economic forecast model.
The economic forecast model included a long-term projection of
revenue requirements and development of quantitative evaluation
metrics for various capital planning alternatives. Subsequent to
this study, Mr. Kreps assisted the County with development of a
comprehensive rate and financial planning study including a pro-
jection of rates, revenues, and revenue requirements over a 10 -year
planning period. Mr. Kreps also prepared a financial feasibility
report for inclusion in the Official Statement of the County's Series
2016 revenue bonds.
Northeast Ohio Regional Sewer District
(Cleveland, OH)
Mr. Kreps served as Project Manager in the development of a com-
prehensive financial plan for the five-year period 2007-2011 and
2012-2016, as well as various other engagements for the District
since 2004. The District was facing a $3.2 billion capital program,
and it was critical to develop an optimal financing plan that bal-
anced revenue requirements and customer impacts. The financial
plan included projections of customers, water usage and revenues
under the existing rates, projections of operating and maintenance
expense, debt service on existing bonds and additional bonds nec-
essary to fund the capital improvement program, and reserve fund
deposits. In addition, Raftelis recommended a rate adjustment pro-
gram over the five year study period to meet the projected revenue
requirements and maintain the District's financial sustainability.
A user-friendly computer model was also developed for use by
District staff to analyze different planning scenarios.
Town of Oak Island (NC)
Mr. Kreps served as Project Manager on several engagements with
RAFTELIS
the Town of Oak Island, North Carolina. (Town) to provide finan-
cial feasibility consulting services related to its Series 2008 Utility
System Revenue Bonds (Series 2008 Bonds), the Series 2009 Utility
System Revenue Bonds (Series 2009 Bonds), and the Series 2011
Utility System Revenue Bonds (Series 2011 Bonds). The bonds were
issued to fund the design and construction of a wastewater collec-
tion system to provide centralized service to the remaining 85%
of the Town's residents that receive wastewater service from septic
systems. The wastewater collection system includes approximately
85 miles of vacuum collector sewers, nine vacuum stations, one
main pump station, and a force main transmission line to deliver
wastewater to the West Brunswick Regional Wastewater Treatment
Facility. The collection system was constructed in two phases at a
total cost of $150 million.
In order to assist the Town in securing the necessary funds for
its capital initiatives, Raftelis prepared a financial feasibility
report that was included in the Official Statement for the Series
2008 Bonds, the Series 2009 Bonds, and the Series 2011 Bonds.
The feasibility reports included a five-year projection of revenues,
expenses, debt service and debt service coverage, along with spe-
cific documentation of significant forecast assumptions. Raftelis
continues to provide the Town with ongoing rate and financial
planning assistance.
City of Peoria (AZ)
The City of Peoria (City) has experienced fast -paced growth and
heavy development pressure as the City's population has more than
doubled since 1990. As a result, demand for water and wastewater
services has also increased at a rapid pace. Concurrently, the State
of Arizona (State) enacted the Groundwater Management Act and
the Assured Water Supply rules to limit the use of groundwater
and to encourage the use of alternative water supply sources.
As a result, the State mandated that the City reduce its reliance
on mined groundwater and increase its use of renewable water
resources. To comply with these regulatory requirements, the City
developed an aggressive capital plan to reduce its former 100% use
of groundwater through a combination of its existing water supply
sources, maximization of reclaimed water for non -potable use, and
a continued commitment to water resource conservation.
To effectively address these growth and regulatory related issues
and concerns, the City sought assistance in reviewing and updat-
ing its existing water and wastewater rate structure and developing
a 10 -year financing plan for its extensive capital requirements. In
February 1998, the City engaged Raftelis to conduct a comprehen-
sive water and wastewater rate and financial planning study, which
incorporated a water and wastewater utility rate study, an update
of its water and wastewater development fees, the development
of a water resource fee, and the development of an appropriate
financial plan and bond feasibility forecast. Following these initial
engagements, Raftelis has assisted the City in updating its water
and wastewater rates, utility financial plan, and utility develop-
ment fees on a biennial basis (2000, 2002, 2004 and 2006). As part
of these updates, the City implemented a uniform service area
approach to determining its development fees.
In 2003, Raftelis further assisted the City in determining utility
development fees for a separate service area located west of the
Aqua Fria River. Although the City assesses uniform water and
wastewater development fees to customers in all other areas of
its water and wastewater system, proposed development in this
independent service area requires significant investments in capital
improvements and certain portions of the required infrastructure
will be financed through a Community Facilities District. Since
these fees will be separate and unique from the fees assessed to
other customers within the City's current service area, the City
requested that Raftelis calculate the fees based upon the specific
costs for the infrastructure they are intended to recover.
Pima County (AZ)
Mr. Kreps served as Project Manager or Lead Consultant on mul-
tiple engagements for Pima County, Arizona (County). In 2005,
Raftelis was engaged by the County to provide strategic financial
and analytical support related to the long-term revenue and rate
implications associated with the investment of approximately $1.4
billion in its wastewater system over the next 15 years. The County
is faced with an extraordinary challenging of improving a signifi-
cant portion of its wastewater system in order to comply with more
stringent effluent quality standards imposed by State and Federal
regulators and to meet the needs of a growing customer base. Raft-
elis, in association with Greeley & Hansen, developed an economic
planning model to assess, at a high level, the long-term rate and
customer impacts of various capital investment strategies and
system configurations designed to adequately address regulatory
requirements and provide sufficient capacity to serve both existing
and projected demand. Raftelis also developed a financing plan for
the capital program that considered the use of traditional public
financing instruments, and the use of non-traditional, alternative
financing options, both public and private, that could provide a
more cost-effective strategy for funding certain components of the
capital program.
Based on the results of the capital planning analysis, Raftelis was
retained by the County, in two separate engagements, to develop its
fiscal year (FY) 2008 Financial Plan and conduct a more detailed
economic analysis of alternative project delivery options. The
development of the FY 2008 Financial Plan included a compre-
hensive rate study and creation of a Rate and Financial Planning
Model (Rate Model), to be updated on an annual basis, covering
the Department's Operating and Maintenance (O&M) and capital
improvement financing over a 10 -year forecast period. The Finan-
cial Plan was designed to serve as road -map for funding capital
improvements and basis for developing rates and charges that are
fair and equitable. In 2008, Raftelis was retained by the County to
update its FY 2009 Financial Plan.
Both the FY 2008 and FY 2009 Financial Plans assumed the use
of more traditional public financing instruments, such as reve-
nue bonds and State Revolving Fund (SRF) loans, to financing
the proposed capital improvements, and assumed a more tradi-
tional Design -Bid -Build (DBB) project delivery model. However,
the County was interested in understanding both the economic
14 CITY OF CLEARWATER
and non -economic implications of alternative financing options
and approaches to project delivery, including Design -Build (DB),
Design -Build -Operate (DBO) and Design -Build -Operate -Finance
(DBFO) delivery models. One of the largest projects in the capital
program was the construction of a new 32 million gallon per day
(MGD) water reclamation facility designed to meet all new efflu-
ent discharge requirements. It was determined that this project,
in particular, should be evaluated in terms of the potential risks
and benefits of alternative project delivery options, to determine
which option under consideration could provide the least risk and
lowest probable cost.
To facilitate the quantitative aspects of the alternative project deliv-
ery analysis, Raftelis develop a Multiple Criteria Risk Model (Risk
Model) to project operating and capital costs and calculate Net
Present Value (NPV) life cycle costs for design and construction
of the new water reclamation facility under a base case (DBB), DB,
DBO, and DBFO project delivery alternatives. Raftelis participated
in several workshops with County staff to identify specific variables
and risk parameters that could be quantified. These variables and
risk parameters were incorporated into the Risk Model, which used
Monte Carlo simulations over 5,000 trials to project risk adjusted
NPV life cycle costs for each project delivery alternative. Specific
variables considered included construction schedule, tax-exempt
interest rates, private interest rates, private cost of equity, operat-
ing cost inflation, capital cost inflation and discount rate, among
numerous others. The results of the quantitative analysis identified
DBO as the project delivery alternative with the lowest risk and
NPV life cycle cost.
Other services provided to the County by Raftelis include the val-
uation of a small water reclamation facility serving a community
in the County's outlying service area. The study was conducted to
support the County in negotiations with the community, as it was
evaluating the implications of seeking ownership of this facility.
Raftelis is currently conducting an analysis of the County's meth-
odology used to assess connection fees.
City of Durham (NC)
Mr. Kreps served as Project Manager on numerous engagements
with the City of Durham, North Carolina (City) related to water
and wastewater finance and pricing. In 2007, he assisted the City
with a cost of service water and wastewater rate study focusing
primarily on water conservation pricing. Due to an extreme
drought in 2007, the City was faced with an unprecedented chal-
lenge related to preserving its water supply, and the addition of
a pricing mechanism within its water rate structure became an
immediate priority. Mr. Kreps worked closely with the City to
develop defensible, cost -justified tiered water rates that included
pricing incentives to promote the efficient use of water resources.
Mr. Kreps developed a comprehensive cost of service based rate
model that is currently used by the City as a financial planning
tool and prepared financial forecast and opinion letter related to
the City's $60.0 million 2011 Utility Revenue and Revenue Refund-
ing Bonds. Mr. Kreps also provided valuation services to the City
related to the potential acquisition of Durham County's wastewater
treatment facility. Most recently, Mr. Kreps developed a recapital-
ized value of both the water and wastewater system to support a
calculation of the City's capacity fees.
City of Lakewood (OH)
Mr. Kreps served as Project Manager on a comprehensive water
and sewer rate study for the City of Lakewood, Ohio (City). The
City was facing multiple challenges in developing its financial
plan including, for example, declining consumption, rising costs,
and significant capital needs related to its Long -Term Combined
Sewer Overflow Control (LTCSO) Plan. Mr. Kreps assisted the
City in evaluating the revenue sufficiency and cost equity of its
rate structure for providing water and sewer services. The focus
of the analysis involved the development of a financial plan that
fully supported system operations and maintenance, asset rein-
vestment, debt service, and debt service coverage requirements.
Mr. Kreps developed recommendations that provided a projection
of utility rate adjustments necessary to meet forecasted revenue
requirements over a five-year planning period. For planning pur-
poses, a long-term, 20 -year forecast was also developed to assess,
in particular, the potential impacts of the City LTCSO Plan, with
specific emphasis on measuring rate affordability.
Bowling Green Municipal Utilities (KY)
Mr. Kreps served as Project Manager on a water and wastewater
rate and cost of service study for the Bowling Green Municipal
Utilities (BGMU). BGMU was seeking a comprehensive analysis
of the existing and projected cost basis of utility operations and
an evaluation of the appropriateness of its existing rate structure
for providing water and sewer services. BGMU is facing signifi-
cant capital expenditures related to asset repair and replacement
and system improvements to address aging infrastructure and to
meet regulatory requirements. Mr. Kreps developed a rate and
financial planning model to provide a forecast of rates, revenues,
expenses, debt service, debt service coverage, and reserves over a
5 -year forecast period. The rate model included specific metrics for
tracking reserves to increase liquidity, mitigate operational risk,
and enhance the credit profile of the utility.
City of Philadelphia (PA)
Mr. Kreps has assisted the City of Philadelphia's (City) water and
wastewater utilities (Philadelphia Water) with debt issuance sup-
port services. These services included the preparation of a financial
feasibility report for the City's Series 2016 Revenue Bonds and Bring
Down Letters for the City's Series 2017A and Series 2017B Revenue
Bonds. Raftelis is currently assisting Philadelphia Water with imple-
mentation of its tiered income customer assistance program.
City of Alcoa (TN)
Mr. Kreps has served as manager on multiple engagements with
the City of Alcoa, Tennessee (City). In 2008, Raftelis developed
a wholesale water exchange rate for an emergency connection
between the City and the City of Maryville, Tennessee, as well as a
wholesale water rate for the service provided to the Tuckaleechee
Utility District. In 2010, Raftelis was engaged to conduct a compre-
hensive rate and financial planning study covering both the water
and wastewater utilities. The City was seeking financing from the
RAFTELIS 35
Tennessee Drinking Water Revolving Loan Program to fund a
new finished water storage facility. The State requested that the
City conduct a rate study prior to awarding the funding source, to
ensure the City's rates were sufficient to maintain a positive change
in net assets, which is a requirement of the Tennessee Utility Man-
agement Review Board.
OTHER RELEVANT EXPERIENCE
• Berkeley County (SC) - Development Impact Fee Study, Indus-
trial Water and Sewer Rate Study, and Industrial Rate Update
• City of Buffalo (NY) - Water Cost of Service Study
• Borough of Carlisle (PA) - Water and Wastewater Rate Study
• Chester Wastewater Recover (SC) - Wastewater Rate and Finan-
cial Planning
• City of Concord (NC) - Wholesale Wheeling Charge Study
• Clark County (OH) - Water and Wastewater Rate Study
• D.C. Water (DC) - Water and Wastewater Cost of Service Study
• District of Sooke (British Columbia) - Contract Operations
Review
• Durham County (NC) - Bond Feasibility Study and Rate Model
Update
• Erie County (NY) - Wastewater Utility Consolidation Study
• City of Florence (SC) - Capital Planning Analysis
• Gloucester County (VA) - Water and Wastewater Organiza-
tional Assessment
• Greenville Water (SC) - Rate and Financial Planning
• Hardin County Water District #1 (KY) - Water and Wastewater
Rate Study and PSC Filing
• City of Hopewell (VA) - Wholesale Cost of Service Study
• City of Kinston (NC) - Water and Wastewater Rate Study
• City of Manassas (VA) - Water and Wastewater Valuation
• City of Maryville (TN) - Wholesale Water Rate Analysis
• City of Myrtle Beach (SC) - Water and Wastewater Rate Study
• Rivanna Water and Sewer Authority (VA) - Wholesale Rate
Review
• San Diego County Water Authority (CA) - Wholesale Wheeling
Charge Study
• Sewanee Utility District (TN) - Water and Wastewater Rate
Study and Developer Charge Study
• City of Smyrna (GA) - Water, Wastewater, and Stormwater Rate
Study
• Stanly County (NC) - Water and Wastewater Rate Study
• Town of Sahuarita (AZ) - Wastewater Rate Study
• United States Navy - Privatization Procurement
• Water and Sewer Authority of Cabarrus County (NC) - Water
Consolidation Study
• Webb Creek Utility District (TN) - Water and Wastewater Rate
Study
• City of Wilmington (DE) - Litigation Support
• "2006 Water and Wastewater Rate Survey Results and Indus-
try Trends": Tennessee/Kentucky AWWA Annual Conference,
2006; Virginia AWWA Annual Conference, 2006
• "Financing and Prioritizing Your Utility's Capital Needs": Ten-
nessee/Kentucky AWWA Annual Conference, 2008
• "Are Your Rates Affordability?": WEF Webcast - Managing
Rates and Charges in Challenging Economic Times, 2009
• "Pima County Regional Optimization Financial Plan": WEST -
CAS Fall Conference, 2009
• "Securing Financing in Challenging Economic Times - Case
Study: Town of Oak Island, NC": North Carolina AWWA
Annual Conference, 2009
• "Quantify Risk in Project Procurement": Utility Management
Conference, 2010.
• "Creative Financial Strategies for Virginia Utilities": AWWA/
WEF Webcast, 2011.
• "Rates 101: Basic Fundamentals of Financial Planning and Rate
Setting": Virginia Rural Water Association Annual Conference,
2012.
• "Strategies for Financing a $3.0 Billion Long -Term CSO Control
Plan": Utility Management Conference, 2012.
• "Fixed vs. Variable Charges: Finding a Balance": VA AWWA
WEA Webcast, 2013; WEF Webcast, 2013
• `Addressing Affordability Challenges with Data Driven Man-
agement": Water Finance Conference, 2015
• "Customer Data Mining for Gold: Affordability and Integrated
Planning": Utility Management Conference, 2016
• "The City of Richmond: Integration, Innovation, and Afforda-
bility": NACWA Winter Conference, 2017
• "Infrastructure: "So Much to Do and Not Enough Money to Do
It With": TN/KY Utility Management Conference, 2017
• "A New Water Rate Structure for DC Water Prioritizing Infra-
structure and Affordability": Water Finance Conference, 2018
PUBLICATIONS
• "Municipal Advisor Registration: What You Need to Know":
AWWA Journal, March 2013
• "The Cost of Borrowing: Understanding Credit Ratings": AWWA
Journal, November 2105
• "Evaluating Risk in Capital Planning, Financing, and Rate Set-
ting," for the Fourth Edition of the industry guidebook, Water
and Wastewater Finance and Pricing: The Changing Landscape.
16
SPECIALTIES
• Business/Strategic Plans
• Cost of Service and Rate Studies
• Bond Financing
• Water Conservation Rates
• Contract Negotiation
• Utility Acquisitions
Development Fees
Municipal Impact Fees
PROFESSIONAL HISTORY
• Raftelis: Vice President (2019 -present)
• Public Resources Management Group
(PRMG): (1995-2019)
• CH2M Hill: (1993-1994)
• RW Beck and Associates: (1986-1992)
• Lee County Electric Cooperative (1981-
1986)
• R. W. Beck and Associates: (1978-1980)
EDUCATION
• Bachelor of Science in Business
Administration, Economics - University
of Florida (1977)
PROFESSIONAL MEMBERSHIPS
Florida Government Finance Officers
Association
• American Water Works Association
CITY OF CLEARWATER
Henry rho
Technical Advisor
Vice President (Raftelis)
RO?LE I Will provide technical advice and counsel particularly as it relates to governmental
accounting and finance in Florida.
P R ` FILE: Mr. Thomas has more than 40 years of rate and financial consulting experi-
ence focusing on business issues facing water, wastewater, solid waste, natural gas, electric,
and stormwater utilities. Mr. Thomas' experience includes directing financial consulting
services for publicly -owned utilities and governmental entities. He has been responsible for
preparing utility rate and cost of service studies, business plans, and bond feasibility stud-
ies; designing water conservation rates, connection and development fees, and municipal
impact fees; developing utility financial policies; as well as assisting with the acquisition
of utility properties and other management consulting services. During his career, Mr.
Thomas has served more than 120 clients including county and municipal governments as
well as publicly -owned utility districts, authorities, and cooperatives.
RELEVANT PROJECT EXPERIENCE
City of Lakeland (FL)
Mr. Thomas has served the City of Lakeland since 2009 providing utility rate, financial
planning, and management consulting services to the water and wastewater utility systems.
On behalf of the City, Mr. Thomas has directed a comprehensive cost of service/rate study
and annual revenue sufficiency updates. Major issues addressed for the City include water
conservation rates and rate structures that promote revenue stability and evaluating the
size and timing of capital projects.
Polk County (FL)
Mr. Thomas has served Polk County since 2013 providing utility rate, financial planning,
and management consulting services to the water and wastewater systems. His experience
includes directing utility rate and cost of service studies including the development of water
conservation rate structures and preparing bond feasibility studies.
Charlotte County (FL)
Mr. Thomas has served the Charlotte County Utilities since 1996 providing utility rate,
financial planning, and management consulting services to the County's water and waste-
water systems. As part of this ongoing engagement Mr. Thomas has directed comprehensive
water and wastewater rate studies, bond feasibility studies, utility valuations, impact fee
studies and assisted in the development of water conservation rates and utility expansion
policies and the evaluation of wholesale rate issues related to the Peace River/Manasota
Water Supply.
Valdosta (GA)
Mr. Thomas has worked for the City of Valdosta, Georgia since 1998 providing utility rate
and financial planning services to the City's water and sewer system. His experience with
the City of Valdosta includes preparing a water and sewer master plan capital funding
analysis, a comprehensive water and sewer rate study, including implementation of signif-
icant water conservation rate structures phased -in over a multi-year period, and several
rate sufficiency updates to ensure that the City's water and sewer utility rates are adequate
to fund operating and capital needs, and maintain a sound financial position.
RAFTELIS 17
City of Ocala (FL)
Mr. Thomas has served the City of Ocala since 1992 providing util-
ity rate, financial planning, and management consulting services
to the water and wastewater systems. Mr. Thomas has directed
comprehensive water and wastewater cost of service/rate studies
and annual revenue sufficiency updates for the City. He has also
been involved in the development of system development charges,
water conservation rates and strategies related to providing incen-
tives for growth and economic development.
City of Tampa (FL)
Mr. Thomas has served the City of Tampa since 2005. He has
directed comprehensive, water, wastewater and solid waste rate
studies, and annual revenue sufficiency updates, developed capital
charges related to new development, participated in City's water
and wastewater master planning process to evaluate the financial
impact of capital projects and prepared bond feasibility studies
associated with the issuance of long-term debt.
City of Titusville (FL)
Mr. Thomas has served the City of Titusville, Florida since 2000.
He has directed comprehensive water and wastewater rate studies
and annual revenue sufficiency updates. In addition, he has been
involved in providing capital funding plans for State Revolving
Loans from the State of Florida, Department of Environmental
Protection (FDEP) and assisted in negotiations related to the
formation of a joint public/private entity to provide future water
supplies for the City.
PRO,.:JET- T EXP '.Ri
• City of Apopka (FL)
• City of Auburn (AL)
• City of Bartow (FL)
• City of Town of Bedford (NH)
• City of Cape Coral (FL)
• City of Casselberry (FL)
• Citrus County Utilities (FL)
• City of Clermont (FL)
• City of Cocoa Beach (FL)
• City of Crystal River (FL)
• City of Dade City (FL)
• City of Dania Beach (FL)
• City of Town of Davie (FL)
• Destin Water Users (FL)
• City of Dundee (FL)
• City of Edgewater (FL)
• Enterprise, CDD (FL)
• Fort Pierce Utilities Authority (FL)
• City of Fort Walton Beach (FL)
• Gasparilla Island Water Association (FL)
• City of Town of Goffstown (NH)
• Greater Pine Island Water Association (FL)
• City of Groveland (FL)
• City of Haines City (FL)
• City of Hallandale Beach (FL)
• City of Helena (MT)
• Immokalee Water and Sewer District (FL)
• City of Inverness (FL)
• Jacksonville Electric Authority (FL)
• City of Largo (FL)
• Lee County Electric Cooperative (FL)
• City of Leesburg (FL)
• City of Maitland (FL)
• City of Melbourne (FL)
• Midway Water System (FL)
• City of Miramar (FL)
• City of Mount Dora (FL)
• New Smyrna Beach Utilities Commission (FL)
• City of Newberry (SC)
• City of North Port (FL)
• City of Oakland Park (FL)
• City of Ocoee (FL)
• Okeechobee Utility Authority (FL)
• City of Oldsmar (FL)
• City of Orange City (FL)
• Orlando Utilities Commission (FL)
• City of Oviedo (FL)
• City of Palatka (FL)
• City of Palm Bay (FL)
• City of Palm Coast (FL)
• City of Panama City (FL)
• City of Panama City Beach (FL)
• City of Pembroke Pines (FL)
• City of Plant City (FL)
• City of Port Orange (FL)
• Regional Utilities of Walton County (FL)
• City of Sanford (FL)
• South Walton County Utilities (FL)
• City of Stuart (FL)
• City of Sunrise (FL)
• City of Umatilla (FL)
• City of Vero Beach (FL)
• Virgin Islands Water & Power Authority (U.S. Virgin Islands)
• Volusia County Utilities (FL)
• Wabash Valley Power Association (IN)
• City of Warner Robins (GA)
• City of West Melbourne (FL)
• City of Winter Springs (FL)
Mr. Thomas has directed regulatory rate cases for the Virgin
Islands Water and Power Authority and Charlotte County, Florida
and has testified before the Florida Public Service Commission, the
Indiana Public Service Commission, the Virgin Islands Public Ser-
vices Commission, and District Courts in Florida and Michigan.
CITY OF CLEARWATER
''REST NT.ATaONS
• National Rural Electric Cooperative Association, "Electric Util-
ity Rates in a Competitive Environment", NRECA Managers
Conference; Denver, Colorado, 1995
• National Rural Electric Cooperative Association, "Innovative
Electric Rates", NRECA Marketing, Member Services and Com-
munication Conference; Portland, Oregon, 1995
• National Rural Electric Cooperative Association, "Electric
Utility Rate Making", NRECA National Directors Conference;
Nashville, Tennessee, 1996
• South Carolina Section of the American Water Works Associa-
tion, "Water and Wastewater Impact Fees ", 2001 Management
Forum, 2001
• Florida Water Resources Association, "Water Rates and Con-
servation Practices", 2007 Florida Water Resources Conference
• Florida Rural Water Association, "Communicating Water Util-
ity Rate Needs", 2010 Florida Rural Water Association's Annual
Technical and Training Conference
• North Florida Section of the American Water Works Associa-
tion, "Innovative Water Rates", July 2011
• American Water Works Association, "Utility Impact Fees: Prac-
tices and Challenges" with Bryan Mantz, Awarded AW WA's
Management and Leadership Divisions Best Paper Award for
2013
AW ARDS
• AW WA Management and Leadership Division's 2013 Best Paper
Award
RAFTELIS
1S
SPECIALTIES
• Gas and Electric Utility Financial and
Management Consulting
PROFESSIONAL HISTORY
• Year Career Started - 1980
EDUCATION
• M. B. A., University of Missouri -
Kansas City, 1985
• B. S., Civil Engineering, University of
Missouri - Rolla (Missouri University
of Science and Technology) -1980
PROFESSIONAL MEMBERSHIPS
• American Public Gas Association
• American Society of Civil Engineers
• Tau Beta Pi
• Phi Kappa Phi
• Chi Epsilon
• Beta Gamma Sigma
PROFESSIONAL REGISTRATIONS
• P.E. Missouri
Natural Gas Rate/Cost of Service Technical Advisor
President (Navillus)
I
L. E: Will provide oversight and support for the gas, cost of service, and rate design
portions of the project.
P P0F I L E. Mr. Sullivan has worked on a broad range of projects involving gas and elec-
tric utilities. His engagements include numerous functionalized (unbundled) and class
cost of service studies, accounting and management information systems, rate design,
long-term electric and natural gas demand and energy forecasts, economic feasibility of
utility acquisitions, valuation analyses, cost recovery mechanisms, and depreciation rate
studies. Mr. Sullivan has prepared direct and rebuttal testimony and supporting exhibits
on numerous occasions for expert witnesses. He has testified on revenue requirements,
rate design, class cost of service, class peak day demand requirements, weather normal-
ization, and depreciation rates. Following is a representative summary of some of his
relevant project experience.
RELEVANT PROJECT JECT E PERIENCE
Department of Public Utilities, Orangeburg, South Carolina 1
Competition Services, Load Studies, Rate Design, Cost of Service
Analysis 1 1982 -Present
Mr. Sullivan has served as a project manager on numerous projects for the gas, electric,
water, and wastewater divisions for the DPU. Mr. Sullivan recently provided assistance in
connection with Carolina Gas Transmission's (CGT) (formerly South Carolina Pipeline
Corporation (SCPC)) open access filing first before the South Carolina Public Service
Commission and then before the Federal Energy Regulatory Commission (FERC) and
the subsequent negotiation of the first firm transportation service contract for a distribu-
tion utility on CGT's system. Mr. Sullivan provided assistance to the DPU in negotiating
lower power supply costs which led to the development of lower electric rates in anticipa-
tion of competition. Mr. Sullivan assisted the DPU in the implementation of accounting
and management information GIS systems for all four divisions to better manage costs
and price services in a competitive environment. Mr. Sullivan recently completed a
compensation survey of comparable municipal utilities in the Southwest for the DPU.
The gas related assistance has included gas supply and demand studies, development
of purchased gas cost tracking models, feasibility studies, cost of service, rate design,
and assistance with the DPU's intervention in South Carolina Pipeline rate filings. The
electric related assistance has included electric supply and demand studies, assistance
with power supply negotiations, purchased power cost analysis, cost of service and rate
design, assistance in South Carolina Electric & Gas Co. rate filings, and assistance with
regards to pole connection charges to Time -Warner. Water and wastewater assistance
has included cost of service and rate design.
Black Hills (f/k/a Aquila, Inc., UtiliCorp United and Peoples Natural
Gas Company, SourceGas, Kinder Morgan, and K N Energy, Inc.)!
Cost of Service, Rate Design and Weather Normalization Studies,
Iowa, Kansas, Missouri, Minnesota, Michigan, Colorado, Wyoming
and Nebraska' 1985 -Present
Mr. Sullivan has developed and sponsored as an Expert Witness class cost of service,
rate design, depreciation, decoupling riders, and weather normalization analyses in
connection with filings for gas rate increases before the Iowa Utilities Board, The Public
2 0 CITY OF CLEARWATER
Utilities Commission of the State of Colorado, the Kansas Cor-
poration Commission, the Michigan Public Service Commission,
the Missouri Public Service Commission, the Nebraska Public
Service Commission, the Minnesota Public Service Commission,
the Wyoming Public Service Commission, the Federal Energy
Regulatory Commission, and municipalities in Nebraska. Mr.
Sullivan developed the cost of service study and rate design for the
Company's rate filing for its Colorado intrastate pipeline, Rocky
Mountain Natural Gas Company. Other responsibilities have
included assistance with property valuation, feasibility studies,
energy efficiency plan filings, electric load forecasting, depreciation
rate studies, determination of remaining life of assets, assessment
of corporate overheads, development of computer model, litigation
assistance, and competition.
Interstate Power and Light Company (IPL) 1 Cost of
Service and Weather Normalization, Cedar Rapids,
Iowa 1 2012 -Present
Mr. Sullivan has served as an Expert Witness for IPL in connec-
tion with a rate proceeding before the Iowa Utilities Board. Mr.
Sullivan developed and sponsored IPL's weather normalization
adjustment and class cost of service study. In addition, Mr. Sulli-
van provided analysis and input into IPL's proposed rate design.
Bamberg Board of Public Works 1 Cost of Service
and Rate Design, Bamberg, South Carolina 1
1995 -Present
Mr. Sullivan performed the BPW's recent gas, electric, water, and
wastewater cost of service and rate study. This study included
the development of unbundled electric rates. Prior assistance has
included the development of cost of gas models to track purchased
gas costs and the development of unbundled gas rates to pass along
monthly changes in purchased gas costs. Mr. Sullivan recently
assisted the Bamberg Board of Public Works in negotiating a long-
term power supply agreement with Santee Cooper. Mr. Sullivan has
also assisted Bamberg Board of Public Works in natural gas pipeline
matters before the South Carolina Public Service Commission and
the FERC, and with power supply contract negotiations.
The Empire District Gas Company and Empire
District Electric Company 1 Depreciation Rate
Study, Joplin, Missouri 1 2009 -Present
Mr. Sullivan served as Project Director in connection with the
development of a depreciation rate studies for both the Empire
Gas and Empire Electric systems for filing with the Missouri Public
Service Commission. He has also filed expert witness testimony
on behalf of Empire concerning depreciation expense rate issues
before the Missouri Public Service Commission and the Oklahoma
Commerce Commission.
Natural Gas Processing 1 Revenue Requirements,
Cost of Service, Rate Design, and Weather
Normalization, Wyoming and New Mexico 1
1985 -Present
Mr. Sullivan has developed and sponsored as an Expert Wit-
ness revenue requirements, class cost of service, rate design, and
weather normalization analyses in connection with a filing for gas
rate increases on behalf of Natural Gas Processing's Zia Natural
Gas Company before the New Mexico Public Regulation Commis-
sion. Mr. Sullivan has also developed and sponsored as an Expert
Witness: revenue requirements, class cost of service, rate design,
and weather normalization analyses in connection with a filing for
gas rate increases on behalf of Natural Gas Processing's Wyoming
Gas Company before the Wyoming Public Service Commission.
Clearwater Gas System 1 Rate Study, Clearwater,
Florida 1 2007 -Present
Mr. Sullivan has performed the last three natural gas rate studies
for Clearwater Gas System ("CGS"). These studies recommended
redesign of CGS's base rates to collect more fixed costs through
customer charges, modifications to CGS's rider of collecting reg-
ulatory costs, and an expansion of their weather normalization
adjustment to include conservation and inflation.
Midwest Energy, Inc., Class Cost of Service and
Rate Study, Hayes, Kansas 1 2016 -Present
Mr. Sullivan has performed class cost of service and rate studies
for Midwest Energy's gas utility system. Mr. Sullivan presented the
results of these studies before Midwest Energy's Board of Directors.
Missouri Gas Energy (MGE) 1 Depreciation Rate
Study, Kansas City, Missouri 1 1995-2015
Mr. Sullivan served as Project Director in connection with the
development of depreciation rate studies for filing with the Mis-
souri Public Service Commission. He has also filed expert witness
testimony on behalf of MGE concerning depreciation expense
rate issues before the Missouri Public Service Commission. Mr.
Sullivan also developed depreciation rates for newly installed auto-
mated meter reading (AMR) facilities.
Greenville Utilities Commission 1 Gas Rate and Cost
of Service Study, Greenville, North Carolina 1 2011-
2015
Mr. Sullivan served as Project Director on the gas rate and cost of
service study for the Gas Division of the Greenville Utilities Com-
mission (GUC). In addition, Mr. Sullivan prepared an economic
feasibility study of a proposed compressed natural gas (CNG) fueling
station for GUC. The GUC was also one of the parties in North
Carolina Natural Gas Corporation's retail rate filing before the
North Carolina Utilities Commission in Docket No. G-21 Sub 442
for whom Mr. Sullivan provided testimony regarding cost of service.
Philadelphia Gas Works 1 Engineer's Report,
Philadelphia, Pennsylvania 1 1999-2016
Mr. Sullivan served as Project Director on the engineer's reports
developed for PGW's revenue bond issues totally approximately
$3 billion. Proceeds from the bond issues funded needed capital
improvements to PGW's distribution system and LNG facilities,
and the refunding of bonds to reduce interest costs. The engineer's
report summarized the findings of a study of PGW's facilities,
management, operations, gas supply, rates and marketing, and
customer service, and assessed the financial feasibility of the bond
RAFTELIS 21
issue. Mr. Sullivan also served as an Expert Witness before the
Pennsylvania Public Utility Commission on PGW's behalf, testify-
ing on the appropriate level of PGW's revenue requirement for rate
making purposes. Mr. Sullivan has also prepared a depreciation
rate study for PGW.
Pensacola Energy 1 Rate Study and Annual
Operations Report, Pensacola, Florida 1 1998-2014
Mr. Sullivan serves as Project Director on the annual report prepared
for Pensacola's gas system. This annual report documents interviews,
site visits, and review of records pertaining to the management and
operation of Pensacola Energy to determine if the system is operated
in a safe and reliable manner, is in compliance with State and Fed-
eral regulations, and is in compliance with the covenants sets forth
in the City's bond resolutions. Mr. Sullivan performed Pensacola
Energy's most recent gas rate study and presented the results of this
study to the Pensacola City Council. This study recommended base
rate increases and modifications to Pensacola Energy's cost of gas
recovery model. In addition, Mr. Sullivan assisted Pensacola Energy
in preparing its proposal to the Navy to purchase the gas distribution
systems owned by the military and used to serve the three naval
bases in the Pensacola area, and Mr. Sullivan has assisted Pensacola
Energy in valuing pipeline assets it is and has acquired.
EXPERT WITNESS TESTIMONY
Peoples Natural Gas Company of South Carolina,
South Carolina Public Service Commission Docket
No. 88-52-G (1988)
Natural gas utility revenue requirements and rate design.
Peoples Natural Gas (UtiliCorp United, Inc.), Iowa
Utilities Board Docket No. RPU -92-6 (1992)
Natural gas utility class cost of service study and peak day demand
requirements.
Peoples Natural Gas (UtiliCorp United, Inc.), Kansas
Corporation Commission Docket No. 193,787-U
(1996)
Natural gas utility class cost of service study, rate design, and peak
day demand requirements.
Southern Union Gas Company, Railroad
Commission of Texas Gas Utilities Docket No. 8878
(1998)
Natural gas utility depreciation rates.
Southern Union Gas Company, City of El Paso
(1999)
Natural gas utility depreciation rates.
UtiliCorp United, Inc., Kansas Corporation
Commission Docket No. 00-UTCG-336-RTS (1999)
Natural gas utility weather normalization, class cost of service,
and rate design.
Philadelphia Gas Works, Pennsylvania Public Utility
Commission Docket No. R-00006042 (2001)
Natural gas utility revenue requirements.
Missouri Gas Energy, Missouri Public Service
Commission Docket No. GR -2001-292 (2001)
Natural gas utility depreciation rates.
Aquila Networks, Iowa Utilities Board Docket No.
RPU -02-5 (2002)
Natural gas utility class cost of service study, rate design, and
weather normalization adjustment.
Aquila Networks (Michigan Gas Utilities), Michigan
Public Service Commission Case No. U-13470
(2002)
Natural gas utility class cost of service study, rate design, and
weather normalization adjustment.
Aquila Networks, Nebraska Public Service
Commission Docket No. NG -0001, NG0002,
NG0003 (2003)
Natural gas utility weather normalization adjustment.
Aquila Networks, Missouri Public Service
Commission Docket No. GR -2003 (2003)
Natural gas utility class cost of service study, rate design, annuali-
zation adjustment, and weather normalization adjustment.
North Carolina Natural Gas, North Carolina Utilities
Commission Docket No. G 21 Sub 442 (2003)
Filed intervenor testimony on behalf of the municipal customers
regarding natural gas cost of service, and intrastate transmission
service related cost of service.
Texas Gas Service Company, Division of ONEOK,
Railroad Commission of Texas Gas Utilities Docket
No. 9465 (2004)
Natural gas utility depreciation rates.
Missouri Gas Energy, Missouri Public Service
Commission Docket No. GR -2004-0209 (2004)
Natural gas utility depreciation rates.
Aquila Networks, Kansas Corporation Commission
Docket No. 05-AQLG-367-RTS (2004)
Natural gas utility class cost of service study, rate design, and
weather normalization adjustment.
Aquila Networks, Iowa Utilities Board Docket No.
RPU -05-02 (2005)
Natural gas utility class cost of service study, rate design, grain
drying adjustment and weather normalization adjustment.
2?. CITY OF CLEARWATER
PJM Interconnection, LLC, Federal Energy
Regulatory Commission Docket No. ER05-1181
(2005)
Operating cash reserve requirements.
Kinder Morgan, Inc., Wyoming Public Service
Commission Docket No. 30022 -GR -6-73 (2006)
Weather normalization adjustment, pro forma billing determi-
nants, revenues under existing rates and depreciation rates.
Missouri Gas Energy, Missouri Public Service
Commission Docket No. GR -2006-0422 (2006)
Natural gas utility depreciation rates.
Kinder Morgan, Inc., Nebraska Public Service
Commission Docket No. NG -0036 (2006)
Weather normalization adjustment, pro forma billing determi-
nants, revenues under existing rates and competitive rates.
Aquila Networks, Kansas Corporation Commission
Docket No. 07-AOLG-431-RTS (2006)
Natural gas utility class cost of service study, rate design, irrigation
adjustment, and weather normalization adjustment.
Aquila Networks, Nebraska Public Service
Commission Docket No. NG -0041 (2006)
Natural gas utility jurisdictional class cost of service study, rate
design, and synchronization adjustment.
Zia Natural Gas Company, New Mexico Public
Regulation Commission Case No. 08 -00036 -UT
(2008)
Natural gas utility billing determinants and revenues, weather
normalization adjustment, customer growth adjustment, peak
day analysis, revenue requirement, class cost of service study, and
rate design.
Source Gas Distribution LLC, The Public Utilities
Commission of the State of Colorado Docket No.
08S -108G (2008)
Natural gas utility weather normalization adjustment, irrigation
adjustment, peak day analysis, test year billing determinants and
revenues, and trends in customer usage.
Aquila Networks, Iowa Utilities Board Docket No.
RPU -08-3 (2008)
Natural gas utility class cost of service study, rate design, grain
drying adjustment and weather normalization adjustment.
Black Hills/Colorado Gas Utility Company, LLC
(f.n.a. Aquila Networks), The Public Utilities
Commission of the State of Colorado Docket No.
08S -290G (2008)
Natural gas utility class cost of service study, rate design, ther-
mal billing, customer class redesign, and weather normalization
adjustment.
Wyoming Gas Company., Wyoming Public Service
Commission Docket No. 30009 -48 -GR -08(2008)
Revenue requirement, rate of return, weather normalization
adjustment, pro forma billing determinants, revenues under exist-
ing rates and rate design.
Missouri Gas Energy., Missouri Public Service
Commission Docket No. GR -2009-0355 (2009)
Natural gas utility depreciation rates.
The Empire District Gas Company, Missouri Public
Service Commission Docket No. GR -2009-0434
(2009)
Natural gas utility depreciation rates.
SourceGas Distribution, LLC, Public Service
Commission of the State of Nebraska Docket No.
NG -60 (2009)
Natural gas utility weather normalization adjustment factor,
customer adjustment factor, use per customer adjustment factor,
inflation adjustment factor, pro forma customer adjustment, pro
forma use per customer adjustment, and competitive issues.
Black Hills/Nebraska Gas Utility Company, LLC
(f.n.a. Aquila Networks) Nebraska Public Service
Commission Docket No. NG -0061 (2009)
Natural gas utility jurisdictional class cost of service study, rate
design, weather normalization adjustment, and synchronization
adjustment.
SourceGas Distribution, LLC, Wyoming Public
Service Commission Docket No. 30022 -148 -GR -10
(2010)
Natural gas utility use per customer adjustment factor, inflation
adjustment factor, and uncollectible accounts factor and compet-
itive issues.
Black Hills/Nebraska Gas Utility Company, LLC
(f.n.a. Aquila Networks) Iowa Utilities Board Docket
No. RPU -2010-0002 (2010)
Natural gas utility jurisdictional class cost of service study, rate
design, weather normalization adjustment, grain dryer adjust-
ment, annualization adjustment, ethanol plant adjustment, and
synchronization adjustment.
The Empire District Electric Company, Missouri
Public Service Commission Docket No. ER -2011-
0004 (2010)
Electric utility depreciation rates.
The Empire District Electric Company, Oklahoma
Commerce Commission Cause No. PUD 201100082
(2011)
Natural gas utility depreciation rates.
RAFTELIS 2 -
SourceGas Distribution, LLC, Public Service
Commission of the State of Nebraska Docket No.
NG -67 (2011)
Natural gas utility jurisdictional and class cost of service study,
rate design, customer adjustment factor rider, use per customer
adjustment factor rider, and competitive issues.
Interstate Power and Light Company, Iowa Utilities
Board Docket No. RPU -2012-0002 (2012)
Natural gas utility weather normalization adjustment and class
cost of service study.
The Empire District Electric Company, Missouri
Public Service Commission Docket No. ER -2012-
0345 (2012)
Electric utility depreciation rates.
Rocky Mountain Natural Gas Company LLC, Public
Utilities Commission of the State of Colorado
Docket No. 13AL-0067G (2013)
Intrastate natural gas pipeline cost of service study and rate design.
Rocky Mountain Natural Gas Company LLC, Public
Utilities Commission of the State of Colorado
Docket No. 13AL-067G (2013)
Safety and System Integrity Rider (SSIR).
SourceGas Distribution LLC, Public Utilities
Commission of the State of Colorado Docket No.
13AL-143G (2013)
Tariff provisions to incorporate Docket No. 13AL-0067G unbun-
dling and tariff changes.
Black Hills/Kansas Gas Utility Company, LLC,
Kansas Corporation Commission Docket No.
14-BHCG-502-RTS (2014)
Natural gas utility class cost of service study, rate design, weather
normalization adjustment, and bypass revenue rider.
Wyoming Gas Company., Wyoming Public Service
Commission Docket No. 30009 -57 -GI -14 (2015)
Testified at hearing to consider Wyoming Gas Company's motion
for relief from filing a general rate case.
The Empire District Electric Company, Missouri
Public Service Commission Docket No. ER -2016-
0023 (2015)
Electric utility depreciation rates.
• Wyoming Gas Company, Wyoming Public Service Commission
Docket No. 30009 -60 -GR -16 (2016). Natural gas utility weather
normalization adjustment, test year billing determinants, reve-
nues under existing and proposed rates, cost of capital, revenue
requirement, class cost of service study, and rate design.
• The Empire District Electric Company, The Corporation
Commission of Oklahoma Cause No. PUD 201600468 (2016).
Electric utility depreciation rates.
• Zia Natural Gas Company, New Mexico Public Regulation Com-
mission Case No. 18 -00018 -UT (2018). Natural gas utility cost
of capital, billing determinants and revenues, weather normali-
zation adjustment, peak day analysis, revenue requirement, class
cost of service study, and rate design.
• Kansas City Power & Light Company, Missouri Public Service
Commission Case No. ER -2018-00145 (2018). Electric utility
class cost of service study — production cost allocation.
• KCP&L Greater Missouri Operations Company, Missouri Public
Service Commission Case No. ER -2018-00146 (2018). Electric
utility class cost of service study — production cost allocation.
• Kansas City Power & Light Company, Kansas Corporation
Commission Docket No. 18-KCPE- -RTS (2018). Electric utility
class cost of service study — production cost allocation.
• The Empire District Electric Company, Kansas Corporation
Commission Docket No. 19-EPDE-223-RTS (2018). Electric
utility depreciation rates.
• Black Hills Colorado Gas, Inc., The Public Utilities Commission
of the State of Colorado, Proceeding No. 19AL-0075G (2019).
Natural gas utility weather normalization adjustment, class cost
of service study, and rate design.
• Black Hills Wyoming Gas, LLC d/b/a Black Hills Energy, Public
Service Commission of the State of Wyoming, Docket No.
30026 -2 -GR -19 (2019). Natural gas utility class cost of service
study and rate design.
"Expanding Natural
Gas Service Territory"
Co-authored with Mr. David Durgin, Winter 2013 Issue of "THE
SOURCE", Official Publication of the American Public Gas
Association
2 4
SPECIALTIES
• Utility strategic financial planning
• Cost of Service analysis
• Water, wastewater, and
stormwater rate design
• Conservation rate design
• Statistical analysis
PROFESSIONAL HISTORY
• Raftelis: Manager (2019 -Present);
Senior Consultant (2016-
2018); Consultant (2014-2015);
Associate Consultant (2012-2013)
PROFESSIONAL
MEMBERSHIPS
American Water Works
Association
• Water Environment Federation
EDUCATION
Master of Public Affairs (Public
Finance) - Indiana University
(2012)
Bachelor of Arts in International
Relations - Wheaton College
(2010)
CITY OF RICHMOND
Collin 1
Lead Consultant
Manager (Raftelis)
ROLE: Will serve as the Lead Consultant and will conduct analyses and prepare deliverables
for the project.
PROF I LE: Mr. Drat has a background in public finance and statistical modeling. Since join-
ing Raftelis, he has had the opportunity to participate in an array of utility financial and rate
consulting engagements involving water and wastewater demand analysis, financial planning,
cost of service analysis, cost of service review and rate design.
RELEVANT PROJECT EXPERIENCE
City of Lawrence (KS)
Mr. Drat served as the lead consultant for Raftelis' engagement with the City of Lawrence.
Raftelis completed its initial rate study for the City in 2017. That engagement involved the
development of a comprehensive 10 -year financial plan, water and wastewater cost of ser-
vice studies, conservation rate designs and system development charges. When Raftelis was
retained to update the analysis for the 2019 budget, Mr. Drat worked directly with City staff
to obtain the necessary data, present the results and help prepare to present the results before
the City Commission.
City of Topeka (KS)
Mr. Drat served as the Staff Consultant for the City of Topeka's Office of Utilities and Trans-
portation (City). Mr. Drat has assisted in the development of water and wastewater demand
forecasts, various alternative financial planning scenarios for the each of the City's utilities,
cost of service analyses and rate design alternatives. The rate design services include the
development of irrigation rates, readiness to serve charges, conservation rates, and system
development charges.
City of Junction City (KS)
Mr. Drat served as the Lead Consultant for Raftelis' engagement with the City of Junction City
(City). The scope of work for this engagement involved the development of water and waste-
water demand forecasts, comprehensive financial plans and rate design. A key aspect of this
engagement involved financial planning and rate design which minimizes the financial impact
of the City's relatively large planned capital improvements, while encouraging conservation
among the City's customers. Mr. Drat and the project team worked collaboratively with the
City's engineering consultant to develop three alternative financial planning scenarios based
on various levels of capital expenditures. The recommended financial planning scenario and
associated rates were presented before and accepted by the City Commission.
Detroit Water and Sewerage Department (MI)
Mr. Drat serves as Lead Consultant for Raftelis' engagement with the Detroit Water and Sewerage
Department (the Department). The engagement involves financial planning and rate design for the
water and sewer utilities. Key aspects of this engagement involve analyzing and projecting costs
from wholesale provider the Great Lakes Water Authority (GLWA), analyzing customer afforda-
bility and developing rates which mitigate the impact on lower income customers. Mr. Drat served
as Lead Consultant for the development of the Department's private fire line charge study.
City of Saginaw (MI)
Mr. Drat currently serves as the Lead Consultant for Raftelis' engagement with the City of Sag-
inaw (City). This engagement involves the update of the City's water rate model to establish
RAFTELIS
updated water service rates. A key aspect of this engagement involves
the development of water service rates for the City's 18 wholesale
customers. This required the development of a five-year financial
plan and an allocation of O&M, depreciation and return on rate base
to each of the City's wholesale customers, based on that customers
unique contribution to the City's operating and capital costs. The
City's wholesale customers currently pay a commodity charge which
recovers the cost of providing water service based on their current
demand and a capacity charge which recovers costs on the basis for
their contracted average and maximum day demand.
City of Marquette (MI)
Mr. Drat served as the Lead Consultant for Raftelis' engagement
with the City of Marquette. This engagement involves the devel-
opment of water, sewer and stormwater financial plans and rate
designs. A key aspect of this engagement involved the evaluation
and integration of the City's performance management contract
with Johnson Controls, Inc into the financial plans. Mr. Drat
also worked closely with the City's consulting engineer provid-
ing support and documentation of the financial elements of the
City's Stormwater and Wastewater (SAW) asset management grant
reporting requirements.
Waukesha Water Utility (WI)
Mr. Drat currently serves as the Lead Consultant on Raftelis'
engagement with the Waukesha Water Utility (WWU). WWU
has faced challenges with radium in their current groundwater
supply requiring them to construct the facilities necessary to attain
water from Lake Michigan. The program is anticipated to cost in
excess of $280M and will have a large impact on the customers
of WWU. Mr. Drat has performed a wide variety of analyses
for WWU including a risk focused comparison of two potential
water suppliers, support in the development of WWU's wholesale
service agreements, and assistance developing potential rates to
recover the costs of new program. The most critical aspect of this
engagement has been a detailed review and critique of the cost of
service models of potential wholesale water suppliers the City of
Oak Creek and Milwaukee Water Works.
City of Cookeville (TN)
Mr. Drat serves as the Lead Consultant for Raftelis' engagement
with the City of Cookeville. This engagement involves the City's
water, sewer, natural gas and electric utilities. Mr. Drat is updating
the City's existing water and sewer financial plans, cost of ser-
vice allocations and rate designs for a five-year forecast period. In
addition, Mr. Drat is assisting in the development of rate structure
alternative for the City's natural gas utility. This involves a nor-
malized forecast of customer throughput, via the use of weather
and customer data and statistical techniques. This normalized
usage will inform the development of alternative structures which
recover the appropriate level of margin (i.e. gas distribution costs,
excluding cost of gas) from City customers.
City of Clarksville (TN)
Mr. Drat served as the lead consultant for Raftelis' engagement
with the City of Clarksville. The engagement involved the devel-
opment of a comprehensive financial plan, cost of service study
and rate design for the City's natural gas utility. A key driver of the
study was the anticipated construction of the Texas Gas Pipeline
interconnect. Mr. Drat plan evaluated gas revenues at existing rates
and determined the adjustments required to ensure the City would
continue to meet its debt covenants following the issuance of the
debt for the project. Another critical aspect of the project involved
forecasting demand for the City's various customer classes. Mr.
Drat evaluated recent years of historical natural gas demand as well
as historical heating degree days to develop a normalized usage
forecast to inform the financial plan and cost of service study.
City of Round Rock (TX)
Mr. Drat serves as the Lead Consultant for Raftelis' engagement
with the City of Round Rock (City). This engagement involves the
development of water and wastewater financial planning, cost of
service, rate design services. The project team began the engage-
ment by assessing the rate model currently used by the City, and
later produced an updated model to meet the City's needs. A key
component of the financial planning process involved planning
for the additional capital expenditures associated with new assets
constructed by the Brushy Creek Utility Authority, in which the
City is a participant. The engagement also involved the preparation
of wholesale water and wastewater rates based on the utility basis
cost allocation methodology.
City of Suffolk (VA)
Mr. Drat currently serves as the Project Manager for Raftelis'
multi-year engagement with the City of Suffolk (City) to provide
financial services to the City's Department of Public Utilities (DPU).
The scope of services includes an annual update of the ten-year
comprehensive financial plan, determination of water and sewer
costs of service, development of proposed water and sewer rates for
the upcoming fiscal year, and an assessment of the City's water and
sewer system availability fees. In addition, Mr. Drat collaborates
with utility staff in the development of an annual comprehensive
water and wastewater demand forecast, as part of the annual rate
study engagement. Each year the performance of this forecast is eval-
uated on a monthly basis against the actual billing data received by
the City and calibrated as necessary for the following year.
Strathcona County Utilities (AB)
Mr. Drat served as the Lead Consultant for Raftelis' engagement
with Strathcona County Utilities (SCU). This engagement involved
the development of a comprehensive wastewater financial plan-
ning model, cost of service analysis and rate design services. This
engagement involved a thorough review of the SCU's existing rate
modeling practices, the development of an updated rate model and
the development of several wastewater rate alternatives to meet the
County's objectives. Particular issues addressed by the study were
a review of the County's charges for third party wastewater treat-
ment, an examination of fixed cost recovery, rate consolidation
customers with similar service levels and pricing policy recom-
mendations regarding customers with non -continuous wastewater
usage (i.e. snowbirds).
Regional Water Customers Group (AB)
Mr. Drat has served as Lead Consultant for Raftelis' ongoing
engagement with the Regional Water Customer Group (RWCG)
since 2013. The Regional Water Customer Group (RWCG) is a
consortium of nine water service providers located in suburban
Edmonton who purchase treated water supplies from EPCOR
Water Services Group, Inc. (EPCOR). Mr. Drat provided staff con-
sulting support during the RWCG's negotiations with wholesale
provider EPCOR following litigation at the Alberta Utilities Com-
mission. Mr. Drat reviews EPCOR's prospective and actual cost of
service models annually to ensure they comply with the agreed
to methodology. Mr. Drat has also performed sensitivity analyses
around RWCG's peak usage, which heavily influences its allocated
cost of service form EPCOR. This analysis aided the RWCG in
weighing the cost of reducing peak usage (asking customers to
conserve on peak days) with the potential financial benefit.
Providence Water Supply Board (RI)
Mr. Drat served as the Lead Consultant for the Providence Water
Supply Board (PWSB), preparing schedules for the Board's four
most recent rate filings (Dk. 4571, Dk. 4406, Dk. 4571 and Dk.
4618) with the Rhode Island Public Utilities Commission (RIPUC).
These filings involve the development of detailed rate year reve-
nue requirements, updating cost of service allocations and rate
design. Mr. Drat prepared calculated rates in accordance with
PWSB's existing rate structure as well as alternative rates designed
to promote water conservation. In addition, Mr. Drat assisted in
authoring expert testimony to the RIPUC, prepared responses to
data requests and adjusted rate schedules as necessary.
City of Aztec (NM)
Mr. Drat served as the Lead Consultant for the Raftelis' engagement
with the City of Aztec. The engagement involves the development
of water, wastewater and electric utility financial plans, cost of ser-
vice studies and rate designs. A key aspect of this engagement has
involved the development of multiple financial planning scenarios
to support the City capital improvement program. The program
involves future expenditures which greatly exceed the amount the
City has expended in the past. Evaluating the various financing
options has assisted the City in prioritizing water, wastewater and
electric capital improvement projects.
City of Bloomington (IL)
Mr. Drat served as the Lead Consultant for Raftelis' engagement
with the City of Bloomington (City). This engagement involves
the development of comprehensive wastewater and stormwater
financial plans and planning models for the City's use. The finan-
cial plans involve a forecast of water and stormwater revenue, the
development of a capital financing plan to fund improvements to
the wastewater and stormwater systems and a detailed cash flow
analysis for each utility indicating the rate adjustments necessary
to ensure operational sustainability. A key component of this
engagement will involve modeling the impact on rate adjustments
of various levels of capital reinvestment.
CITY OF RICHMOND
Marana Water (AZ)
Mr. Drat serves as the Lead Consultant for Raftelis' engagement
with Marana Water, the utility providing water and wastewater
service to the Town of Marana. This engagement has involved the
development of water and wastewater financial plans, cost of ser-
vice analyses and alternative rate designs. A unique aspect of this
engagement has involved the development of multiple financial
planning scenarios in order to aid Town staff in developing a plan
which would balance the need for capital reinvestment against the
impact to Marana Water customers.
OTHER RELEVANT EXPERIENCE
• City of Alexandria (VA) - Water Rate Litigation Support
• City of Alpena (MI) - Wholesale Water and Sewer Rate Litiga-
tion Support
• City of Baltimore (MD) - Stormwater Utility Implementation
• City of Clarksville (TN) - Natural Gas Rate Study
• City of Flint (MI) - Water and Wastewater Financial Planning
and Cost of Service Studies
• City of Junction City (KS) - Water and Sewer Financial Planning
and Cost of Service Study
• City of Marquette and Marquette Township (MI) - Joint Water
Rate Study
• Gran Melia (PR) - Water Rate Litigation Support
• Masonic Villages at Sewickley (PA) - Sewer Rate Litigation
Support
• Northwest Water Commission (IL) - Utility System Valuation,
Wholesale Rate Methodology, Misc. Financial Analyses
• Orangeburg Department of Public Utilities (SC) - Water, Waste-
water, Nat. Gas, Electric Rate Study
• Pennichuck East Utility (NH) - Water Cost of Service Study
• Port Huron Township (MI) - Wheeling Rate Analysis
• Silverleaf Resorts, Inc (MO, IL, TX) - Water and Sewer Rate
Litigation Support
• St. Louis Metropolitan Sewer District (MO) - Rate Analysis
Support
• State of Michigan Department of Treasury (MI) - Various Finan-
cial Analysis for City of Flint Utilities
• Tacoma Public Utilities (WA) - Econometric Water Demand
Modeling
• -"Which Came First? An Integrative and Iterative Approach to
Funding Infrastructure in Junction City" (KWEA & KSAWWA
Joint Annual Conference)
• -"Ratemaking 101: Best Practices for the Financially Sustainable
Utility" (KWEA & KSAWWA Joint Annual Conference)
• -"Principals of Water, Wastewater and Stormwater Rate Setting"
(NYAWWA Edwin C. Tifft Jr. Water Supply Symposium)
• -"Financial Breakdown in the Vehicle City: Finding a Way Forward
for Flint Finances in the Wake of the Water Crisis" (AWWA/WEF
Utility Management Conference)
h Pe,.JS:CT A "i•>idOACH ETHO' OL€?GY. AND S'C.}IE.GULS: FOP COM:TION 27
Project Approach
As indicated in the Request for
Proposals (RFP), the proposed scope
of work is to establish natural gas utility
rate structures that are sufficient to
meet the Clearwater Gas System's (CGS)
current and future revenue requirements,
including projected operating costs,
capital costs, debt service costs and
coverage, and working capital reserve
requirements. In summary, the following
general tasks will be performed to meet
these goals:
• Prepare a five-year forecast of
revenues and revenue requirements
in order to evaluate the adequacy of
existing rates to meet operating costs,
capital costs, and debt service costs
and maintain an adequate level of
working capital reserves
• Prepare a class cost of service study
to determine the cost associated with
providing service to each customer
class and compare this cost of service
to the current revenues
• Recommend rates sufficient to meet
CGS' forecasted revenue requirements
and reflect cost of service and other
policy considerations
TASK 1
Project Initiation and Data Collection
Task 1.1 — Data Collection
Prior to the kick-off meeting, Raftelis will provide a data request
to CGS listing the principal information needed to perform the
rate study. This request will include items such as historical billing
data (number of customers, throughput, and revenues), audited
financial statements, operating and capital budgets, reserve poli-
cies, debt service requirements, plant accounting information, gas
supplier and transportations bills, weather data, current natural
gas tariff, etc. The goal is for Raftelis to review as much information
as possible prior to the kick-off meeting so that time can be spent
on specific questions related to this information.
Task 1.2 — Kick-off Meeting
Raftelis proposes that this meeting be on-site in Clearwater. The
agenda for this meeting will include the following:
• Review work plan and project schedule
• Review data requirements
• Discuss CGS's policy goals and historical considerations
• Discuss specific rate design goals
k i6a w
Financial Analysis
Task 2.1 — Develop Revenue Forecast
Our project team will project Clearwater's revenues over a five-year
forecast period. Longer-term projections can also be developed for
planning purposes. Revenues typically consist of operating and
non-operating revenues. Operating revenues consist principally
of rate revenues derived from the services provided by the utility
to customers. Operating revenues are directly affected by the level
of rates and charges, the service levels provided, and gas costs,
which are passed through directly to customers. Since a rate anal-
ysis is focused on determining the appropriate level of base rates
(excluding gas costs), our analysis will assume that 100 percent of
gas costs (gas supply, transportation, upstream storage, etc.) are
collected through Clearwater's Purchased Gas Adjustment (PGA).
Other operating revenues include such items as connection and
reconnection fees, late payment fees or forfeited discounts, gas
piping, appliance sales, and other revenues incidental to provid-
.as CITY OF CLEARWATER
ing gas service. Non-operating
revenues primarily relate to
interest income.
In order to prepare the reve-
nue forecast, we will forecast
the number of customers and
throughput per customer
under normal conditions. Our
projections will be based on
data obtained from CGS and
discussion with management
regarding marketing efforts and
potential large load additions.
The class throughput forecasts
will be based on the product of
the number of customers and
the use per customer forecasts.
For customer classes whose
usage is weather dependent (res-
idential and commercial), the
use per customer forecasts will
be developed based on regres-
sion analyses of historical use
per customer, heating degree-
days, and time. The results of
this regression analysis take
into consideration changes in
usage characteristics over time
as well as variations in through-
put resulting from variation in
weather conditions. Normal
(weather normalized) use per
customer will then be forecast
using the regression coefficients
and normal heating degree-
days for the forecast period.
We typically forecast other
operating revenues using a
trend analysis with adjust-
ments to reflect known changes
historically experienced as well
as changes anticipated to occur
during the forecast period. We
forecast non-operating rev-
enues based on forecast debt
reserves and other significant
cash reserves.
Task 2.2 — Develop
Revenue Requirement
Forecast
Revenue requirements typically
consist of operating expenses
[operations and maintenance
(O&M), administrative and
general (A&G), bad debt cost,
etc.], depreciation expenses debt
service requirements (inter-
est and principal payments
on outstanding debt issued
by CGS), and cash -financed
normal capital improvements.
Allowance can also be included
for contributions or transfers to
the City of Clearwater's (City)
general operating fund, debt
service coverage requirements,
and reserve requirements. The
revenue requirements analysis
will be based on the unbun-
dling of the gas supply related
costs (supply, transmission,
and storage) from the costs
of operating the distribution
system. These costs are essen-
tially the revenue requirements
associated with the PGA. It is
important in the analysis that
the gas revenues and gas costs
be synchronized such that the
remaining costs can accurately
reflect the level of costs to be
recovered from the margin or
base rates.
These revenue requirements
are forecasted over a five-year
period. To the extent that CGS's
has budgets of future operations
and capital improvements, we
will consider them in our pro-
jection. In the alternative, or as
a supplement, we will forecast
operating expenses based on
historical trends while taking
into consideration inflation
and/or wage increases or other
know increases (benefits and
health care costs, for example).
Depreciation expense is typi-
cally calculated directly from
plant investment. Therefore, a
sub -element of our projection
of revenue requirements will
be a projection of plant in ser-
vice (taking into consideration
budgeted capital improvements
and retirements). Debt service
requirements can generally
be obtained from debt service
schedules. To the extent that
a future bond offering is to be
included, we will review CGS's
capital improvement plan and
develop a capital financing
approach to address the timing
and size of future borrowings
and related debt service and
coverage costs. As a Registered
Municipal Advisor, Rafte-
lis will be able to work with
CGS to craft a suitable capital
financing plan considering
CGS's current debt profile and
financial policy goals for equity
financing. As it relates to future
debt financing, options may
be more general and based on
levelized principal and interest
payments or consideration may
be given to alternative options
for structuring debt such that
a more customized debt profile
can be utilized to help miti-
gate the impact on customers.
Registration as a Municipal
Advisor is a requirement under
the Dodd -Frank Wall Street
Reform and Consumer Protec-
tion Act. All firms that provide
financial forecasts that include
recommendations about the
size, timing, and terms for
possible future debt issues
must be registered with the
U.S. Securities and Exchange
Commission (SEC) and the
Municipal Securities Rulemak-
ing Board (MSRB).
Task 2.3 — Develop
Capital Improvement
Forecast
As a part of the revenue
requirements forecast, Raftelis
will develop a five-year projec-
tion of capital improvements
with distinction being made
between improvements that
will be funded from current
operations and improvements
to be funded through debt
issues. As discussed later in
the rate design section of our
proposal, we may also differen-
tiate projects that are related to
integrity management and/or
projects that are related to reg-
ulatory requirement or other
governmental activities.
Task 2.4 — Develop
Financial Plan
Once all the revenue require-
ments have been projected,
we will determine the net cash
flow of the utility. Net cash
flow is equal to total operat-
ing revenues minus operating
expenses, minus contributions
or transfers to the City's oper-
ating fund, minus debt service
(principal and interest), and
minus cash financed capital
improvements. To the extent
that net cash flow is negative,
the difference must be made up
through rate increases.
If applicable, we will perform
a debt service coverage cal-
culation to determine if debt
service coverage requirements
are being met.
In determining the level of
rate revenue deficiency, we will
consider all of the following:
• Amount needed to achieve
positive net cash flow over
the five-year period
• Amount needed to meet cov-
erage requirements over the
five-year period
• Amount needed to achieve a
certain level of cash reserves
over the five-year period
The overall revenue deficiency
is essentially the highest
requirement of these three
considerations. This level of
deficiency and consideration
of class cost of service and
other policy considerations
will form the basis for recom-
mended rate changes.
RAFTELIS
Task 2.5 — Review
Results with City Staff
Prior to commencing with the
class cost of service study and
rate design, we will provide
CGS with the preliminary
financial plan. Raftelis proposes
to conduct a conference call to
review these results and solicit
City staff reaction and input.
Class Cost of
Service Study
Task 3.1 — Develop
Billing Determinants
and Allocation Bases
The principal allocation bases
used in the class cost of service
study are related to annual vol-
umes, peak day requirements,
and the number of custom-
ers. The annual volumes and
number of customers used are
the same as those developed
in the revenue forecast. The
peak day forecast is typically
based on a forecast of design
day (highest expected demand)
requirements. For customers
whose primary use is space
heating (residential and com-
mercial), the peak demand
forecast will be developed from
the statistical analysis used
to develop the normal usage
essentially by using peak day
heating degree-days rather
than monthly or annual heat-
ing degree-days. For classes
whose usage is not weather
dependent, the peak day
requirements will be based on
consideration of historical usage
patterns and daily metered data
(usually available for large cus-
tomers and/or customers who
are transporting their own gas).
The allocation of customer -re-
lated costs such as service lines,
A, , Registered Municipal
d 1sor Raftelis will be
able to work. -with CGS
ft a suitable pit
h naneing plan. considering
CGS's current debt profile
and financial policy
equity
meters, and regulators will be
based on the relative invest-
ment required to provide these
facilities to customers. The
relative cost may be based on
consideration of current typi-
cal cost of such installations or
the historical costs contained
in CGS's property records (if
available).
Task 3.2 — Develop Class
Cost of Service Study
Raftelis follows the standard
three-step analysis process in
performing a class cost of ser-
vice study: 1) functionalization
(supply, storage, distribution,
general plant, meters/regula-
tors, customer components)
of rate base and revenue
requirements; 2) classification
of functionalized components
(e.g., demand, commodity, or
customer cost); and 3) alloca-
tion of each component among
the rate classes.
The first step in the analysis is
to select a test year that reflects
typical operations of the nat-
ural gas system. Test -year
revenue requirements to be
allocated to customer classes
equal revenue under existing
rates plus the required reve-
nue increase. The appropriate
allocation of cost provides a
measure of the responsibility
of each customer class for the
total cost of utility service
provided by CGS. A com-
parison of these costs with
rate revenues under existing
rates provides a guide for
the development of fair and
equitable rates. In addition,
our class cost of service study
will determine unit cost of
service, which can be used as
a tool to design specific rate
components such as demand,
commodity, and customer
charges.
The functional classification of
cost of service is based upon
an analysis of the use of major
plant elements. The major plant
elements for a natural gas util-
ity include mains, services,
meters and regulators, general
plant, and, in some cases, peak
shaving facilities. We classify
the major plant elements to
functions and then use this
allocation of plant as our basis
to allocate O&M and A&G
expenses to functions.
Costs are allocated to cus-
tomer classes in proportion to
a0
Raftelis will develop a
customized financial
model for the City
that incorporates a
dashboard to allow
you to easily run
scenarios and see the
impacts in real time.
Shown here is a sample
dashboard that we developed
for another project.
the class responsibility for the
functional use of the natural
gas system. Functional factors
typically used include demand
requirements (maximum daily
use), volume of gas (through-
put), and number of customers.
Capacity -related facilities
include a portion of natural
gas distribution mains and
distribution regulators.
The investment in these
facilities and the expenses
associated with their opera-
tions are mainly determined
by customer peak demands.
Costs related to throughput
are those that tend to vary
with the quantity of natural
gas delivered. The commod-
ity cost of purchased gas is a
typical example of a through-
put -related cost that applies to
non -transportation customers.
Customer -related costs are
expenses associated with items
such as service lines, meters,
house regulators, customer
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75.000 $ ,0
5 14E000 0 . 1 . 1 55,00
3 0.500 1 1,000 5 4E00 5 4000 0 5,000 1 6,000 5 4000 5 9.000 5 0.001 5 10,000
RASO BASIS FINANCIAL PROFORMA
7.11!"11
1111111111
MONIIILY DILL
billing, and accounting and
tend to vary with the number
of customers served.
In order to allocate costs of
service to customer classi-
fications, test -year revenue
requirements are separated
between operating expense,
depreciation expense, and
capital costs. Transfers,
normal capital additions,
and/or reserve requirements
may be considered separately.
For purposes of class cost
of service, current customer
classifications are used.
Rate Design
Task 4.1— Design Rates
Adequacy of the existing rates
for each class is tested by com-
paring revenues under existing
rates with allocated class cost
UTILITY BASIS FINANCIAL PRO roRIAA
; I I I
i I I I I I
NFFDS
5121 5125 M.'
MCC I IN 5,52
of service. The class cost of
service study will reflect an
overall revenue requirement
that includes the revenue defi-
ciency as discussed in the prior
section. Therefore, the class
cost of service study will pro-
vide the amount of deficiency
for each class of customer.
This will be one consideration
in the rates recommended. In
addition, since the class cost of
service study will also provide
unit cost of service, it can be
used as a basis for things such
as recommended levels of cus-
tomer charges. In addition to
the class cost of service study,
the following additional factors
will be considered in recom-
mending rate adjustments:
• The cash requirements over
the entire five-year period,
not just the test period used
for the class cost of service
study
• Market or competitive factors
• Historical rate relationships
that may exist due to existing
RrNT COVERAGE
2.115.
NAYS' CASH ON HAND
RETURN ON RATE 665E
f` 510 SSB f16
51
550
ANNUAL DEPRECIATION
policy
• Marketing efforts
• Revenue stability and the
amount of revenues collected
through fixed (customer
charges) and variable (volu-
metric) rate components
• Other policy considerations
provided by CGS
Task 4.2 — Other
Rate Considerations
and Riders
In addition, Raftelis will
also advise and assist CGS
in developing alternate rate
design and/or decoupling
mechanisms. It is our under-
standing that CGS already
utilizes several rate riders
including a Usage and Infla-
tion Adjustment (UTA), an
Energy Conservation Adjust-
ment (ECA), and a Regulatory
Imposition Adjustment (RIA).
These rate riders are designed
to mitigate risk associated with
variability in consumption,
declining per capita usage,
RAFTELIS
rising costs due to inflation,
and increased regulatory costs.
Raftelis will review all current
alternative rate design and/
or decoupling mechanisms
and make recommendations
for any modifications or
additional options, if appro-
priate. Raftelis can also review
other miscellaneous fees and
charges contained in CGS's
natural gas tariff.
Task 4.3 — Develop
Typical Bill Analysis
In order to determine the
impact of our proposed rates,
we will prepare typical bill
analyses showing the revenues
under existing and proposed
rates for various appropriate
consumption levels. If CGS has
regional rate surveys showing
a typical bill for neighboring
utilities, this analysis may also
be included for comparative
purposes.
Task 4.4 — Review
Results with City Staff
Once we have preliminary
results of the class cost of ser-
vice study and rate design, we
will provide City staff with the
preliminary results. Prelimi-
nary results will be discussed
with City staff during an
on-site meeting in Clearwater.
Electronic copies and draft
schedules of the preliminary
results will be provided to City
staff one to two weeks prior to
this meeting. Feedback at this
meeting will then be incorpo-
rated as appropriate. A second
(optional) meeting with City
staff to review revised results
can be conducted with City
staff upon request. Once all
comments have been incor-
porated Raftelis will conduct
a meeting with City staff, the
City Manager, and/or Assis-
tant City Manager to review
draft project results. Electronic
copies and schedules of the
draft results will be provided
one to two weeks in advance of
this meeting. Comments and
feedback from this meeting
will then be used to prepare a
draft report (see Task 5).
Develop Report and
Presentations
Task 5.1— Issue Draft
Report and Present
Study Results
The results of the rate study
and the methodologies used
will be described in a detailed
draft report. This report will
include an executive summary
highlighting major issues and
recommendations including
proposed rate tariff changes
and supporting schedules. The
draft report will be provided to
City staff to obtain additional
input to be incorporated into
the report as appropriate. After
incorporating any further
changes, Raftelis will provide
the draft report to City staff in
advance of individual meetings
with City Council members.
It has been assumed these
meetings will be conducted
over a two-day period. Addi-
tional comments received will
then be incorporated into a
draft final report. Raftelis will
attend two meetings with the
City Council (work session and
regular meeting) to present the
draft final report.
Task 5.2 —
Issue Final Report
Comments received from the
City Council will be incorpo-
rated into the draft final report.
A final rate study report will
then be produced, and we will
provide City staff with both
printed and electronic copies.
;f'N; CITY OF CLEARWATER
Project Schedule
Raftelis will complete the scope of services within the timeframe shown in the schedule below. The proposed schedule assumes a
notice -to -proceed by the beginning of December 2019, and that Raftelis will receive the needed data in a timely manner and be
able to schedule meetings as necessary. Project completion is estimated for August 2020. Raftelis has the resources to expedite this
schedule if necessary.
December
1. Project Initiation and Data Collection
2. Financial Analysis
3. Class Cost of Service Study
4. Rate Design
5. Develop Report and Presentation
tk In -Person Meetings / Workshops
Web Meetings
Deliverables
January
February
March
April
May
June
July August
sr : R.NCti_,.
References
On the following pages, we have provided detailed descriptions of several projects that we have worked on
that are similar in scope to this project. We have included references for each of these clients and urge you
to contact them to better understand our capabilities and the quality of service that we provide.
City of Clarksville
TENNESSEE
References: Fred Klein, CPA, CGA, Chief Financial Officer
2215 Madison Street, Clarksville, TN 37043
P: 931.542.9610 / E: fred.klein@cityofclarksville.com
Dates of Service: 1/1/18 - 10/1/18
Project Team: Bart Kreps, Tom Sullivan, & Collin Drat
Raftelis in conjunction with Navillus Utility Consulting, LLC (the
project team) prepared financial planning, cost of service, and
rate design analyses for the City of Clarksville's (City) natural gas
utility. A key driver of the study was the anticipated construction
of the Texas Gas Pipeline interconnect. The project team evalu-
ated gas revenues at existing rates and determined the adjustments
required to ensure the City would continue to meet its debt cove-
nants following the issuance of the debt for the project. Another
critical aspect of the project involved forecasting demand for the
City's various customer classes. The project team evaluated recent
years of historical natural gas demand as well as historical heating
degree days to develop a normalized usage forecast to inform the
financial plan and cost of service study.
Raftelis has also provided similar services for the City's water and
wastewater utilities.
City of Cookeville
References: Ronnie Kelly, Director, Department of Water Quality
Control / 1800 S. Jefferson Avenue, Cookeville, TN 38506
P: 931.520.5259 / E: rjk@cookeville-tn.org
Dates of Service: 6/1/18 - 6/1/19
Project Team: Bart Kreps, Tom Sullivan, & Collin Drat
Raftelis conducted a water and wastewater rate and financial
planning study for the City of Cookeville (City). The study was
designed to address a number of financial and pricing objectives
including, in particular, recommendations for cost -justified water
and wastewater rates that fully support system operations and
maintenance, asset repair and replacement, debt service, and debt
service coverage requirements. Additional recommendations were
also provided related to water and wastewater capacity charges that
support growth -related projects to ensure that new customers are
making an equitable contribution toward the capital investment in
the capacity to accommodate growth. Capacity charges were cal-
culated based on the system buy -in approach, which reflected the
cost of capacity, expressed in gallons per day, of the City's existing
water treatment plant and transmission system and wastewater
treatment plant and conveyance system. Raftelis also developed
a rate and financial planning model to forecast annual revenue
requirements and rates over a five-year planning period.
Raftelis in conjunction with Navillus Utility Consulting evaluated
the City's natural gas rate structure. Specific emphasis was given to
increasing the City's level of fixed charges to mitigate the impact
of reductions in per capita consumption.
Richmond Department
of Public Utilities
Reference: T. Wayne Lassiter, Utilities Comptroller
900 East Broad Street, Richmond, VA 23219
P: 804.646.5237 / E: wayne.lassiter@richmondgov.com
Dates of Service: 1/1/08 - Present
Project Team: Bart Kreps
Since 2007, Raftelis has assisted the Richmond Department of
Public Utilities (DPU) with various financial, rate, and manage-
ment consulting services for water, wastewater, stormwater, natural
gas, and electric street lighting utility services.
Initially, Raftelis worked with DPU to develop a financial planning
model that incorporates all utility systems: water, wastewater, nat-
ural gas, street lighting and stormwater. DPU uses the model to set
rates, determine optimal capital financing scenarios and report on
utility system financial conditions. The financial plan includes a pro-
jection of units of service (customer accounts and usage), operating
expenses, and capital improvements. One key goal of the model is
the assessment of utility asset condition and the development of a
system recapitalization budget for DPU. Raftelis assisted DPU with
an evaluation of capital financing alternatives, including revenue
bonds, general obligation bonds, Virginia Resource Authority
(VRA) loans, Build America Bonds (BAB) and grants to fund capital
improvements. Raftelis recently completed a cost of service study for
DPU's water and wastewater utilities. The results of
the study included several adjustments to the rate
structures that balanced pricing goals of afforda-
bility, revenue stability, and resource conservation.
Raftelis is currently providing ongoing rate and
financial consulting services to DPU. These services
include various cost of service analyses and support
for DPU's effort to develop an integrated plan for its
water, wastewater, and stormwater utilities. Raftelis
is working with DPU to define and measure various
metrics of rate affordability, which will be used to
help frame discussions with regulators to determine
sustainable levels of capital spending. Raftelis also
provides debt issuance support services including
preparation of financial feasibility reports.
Raftelis annually prepares DPU's five-year finan-
cial model, which includes the implementation of
a rate structure change from an equivalent resi-
dential unit to per thousand square foot unit of
charge. In addition to developing the prospective
costs, plan for capital improvement financing, and
five-year rate plan, we are providing supporting
analysis associated with the proposed rate struc-
ture change as well as advising the utility on its
stormwater compliance, fee, and rate structure
change outreach process.
Since 2015, Raftelis has provided data manage-
ment -related services, beginning with a needs
assessment for key systems and data needs related
to management, reporting, and business process
efficiency. DPU identified that the development of
a water loss program was a key need identified in
the assessment, and Raftelis assisted DPU with the
completion of its first water audit, aligning with
the AW WA M36 Manual. Raftelis is also building
an integrated software program supporting DPU's
Water Metro Care Affordability Program that pro-
vides an automated link between intake occurring
at the Department of Social Services and DPU's
customer information system.
In addition to our water and wastewater consulting,
Raftelis' multi-year engagement with DPU includes
stormwater services. We are currently preparing
the Department's five-year financial model, which
includes the implementation of a stormwater rate
structure change from an equivalent residential unit
to per thousand square foot unit of charge. In addi-
tion to developing the prospective costs, plan for
capital improvement financing, and five-year rate
plan, we are providing supporting analysis associ-
ated with the proposed rate structure change as well
as advising the utility on its stormwater compliance,
fee, and rate structure change outreach process.
CITY OF CLEARWATER
Orangeburg Department of Public Utilities
51i1.ITH CAROLINA
References: Warren T. Harley / 1016 Russell Street, Orangeburg, SC 29116
P: 803.268.4000 / E: wharley@orbgdpu.com
Dates of Service: 1982 - Present
Project Team: Tom Sullivan & Bart Kreps
Tom Sullivan has served as a project manager on numerous projects for the gas,
electric, water, and wastewater divisions for the Orangeburg Department of
Public Utilities (DPU). Mr. Sullivan recently provided assistance in connection
with Carolina Gas Transmission's (CGT) (formerly South Carolina Pipeline Cor-
poration (SCPC)) open access filing first before the South Carolina Public Service
Commission, then before the Federal Energy Regulatory Commission (FERC),
and subsequently the negotiation of the first firm transportation service contract
for a distribution utility on CGT's system. Mr. Sullivan provided assistance to
DPU in negotiating lower power supply costs, which led to the development of
lower electric rates in anticipation of competition. Mr. Sullivan assisted DPU in
the implementation of accounting and management information GIS systems
for all four divisions to better manage costs and price services in a competitive
environment. Mr. Sullivan recently completed a compensation survey of com-
parable municipal utilities in the Southwest for DPU. The gas -related assistance
has included gas supply and demand studies, development of purchased gas cost
tracking models, feasibility studies, cost of service, rate design, and assistance
with DPU's intervention in South Carolina Pipeline rate filings. The electric -re-
lated assistance has included electric supply and demand studies, assistance with
power supply negotiations, purchased power cost analysis, cost of service and rate
design, assistance in South Carolina Electric & Gas Co. rate filings, and assistance
with regards to pole connection charges to Time -Warner. Water and wastewater
assistance has included cost of service and rate design.
In 2019, Mr. Sullivan collaborated with Raftelis to update the DPU's water,
wastewater, natural gas, and electric rate and cost of service models.
City of Sunrise
References: Wendy Dunbar, Finance Director / 10770 West Oakland Park
Boulevard, Sunrise, FL 33351 / P: 954.746.3297 / E: wdunbar@sunrisefl.gov
Dates of Service: 1/1/2005 - 1/1/2006
Project Team: Henry Thomas
The City of Sunrise (City), located in Broward County, owns and operates a
natural gas utility system serving over 10,000 customer accounts. PRMG, now
a part of Raftelis, performed a natural gas utility rate study on behalf of the
City. As part of the engagement, the project team developed a financial model
encompassing 10 years, with five years of historical and five years of projections.
The model included data concerning the number and consumption of natural
gas by customer class and service type as well as calculated revenues by rate
component (Base Demand and Use Charge), operating expenses, capital invest-
ments, debt service, and other funding requirements. Recognizing that natural
gas operations in the City are not monopolistic, the study also considered com-
petitor rates for service. The result of the study identified the cost of service and
a series of rate recommendations for consideration by the City Commission.
COST OF ;SERVIC:ES..
Cost of Services
The following table provides a breakdown of our proposed fee for this project including estimated expenses. This table includes the estimated
level of effort required for completing each task described and the hourly billing rates for our project team members.
Rate and Financial
Planning Study
Optional Meetings
(per meeting)
Staff List:
Year 1 Year 3 Year 5
$ 58,500 $ 48,000 $ 50,000
$4,500 $4,700 $4,900
Hourly Rate*
Bart Kreps $295
Collin Draft $210
Tom Sullivan $295
Henry Thomas $295
Staff $125
*Hourly rate will be adjusted annually based on the Consumer Price Index for
All Urban Consumers (CPI -U), U.S. City Average, Not Seasonally Adjusted as
published by the U.S. Department of Labor.
This page intentionally left blank to facilitate two-sided printing
OTHER FORMS
EXCEPTIONS / ADDITIONAL MATERIAL / ADDENDA
Proposers shall indicate any and all exceptions taken to the provisions or specifications in this solicitation
document. Exceptions that surface elsewhere and that do not also appear under this section shall be
considered invalid and void and of no contractual significance.
Exceptions (mark one):
**Special Note — Any material exceptions taken to the City's Terms and Conditions may render a
Proposal non-responsive.
X No exceptions
Exceptions taken (describe --attach additional pages if needed)
Additional Materials submitted (mark one):
X No additional materials have been included with this proposal
Additional Materials attached (describe --attach additional pages if needed)
Acknowledgement of addenda issued for this solicitation:
Prior to submitting a response to this solicitation, it is the vendor's responsibility to confirm if any addenda
have been issued.
Addenda Number
Initial to acknowledge receipt
1
3 gK.
Vendor Name Raftelis Financial Consultants, Inc.
Date: 10/16/19
Gas System Utility Rate Study Services
23
RFP #58-19
39
CITY OF CLEARWATER
VENDOR INFORMATION
Company Legal/Corporate Name: Raftelis Financial Consultants, Inc.
Doing Business As (if different than above): Raftelis
Address: 341 N. Maitland Avenue, Suite 300
City: Maitland Avenue
Phone: 704.936.4438
State: Florida
Fax: 828.484.2442
Zip: 32751
E -Mail Address: bkreps@raftelis.com Website: www.raftelis.com
DUNS # 809874100
Remit to Address (if different than above): Order from Address (if different from above):
Address: 227 W. Trade Street, Suite 1400
City: Charlotte
State: NC Zip: 28202
Address: 227 W. Trade Street, Suite 1400
City: Charlotte
Contact for Questions about this proposal:
Name: Bart Kreps, Vice President Fax: 828.484.2442
Phone: 704.936.4438
Day -to -Day Project Contact (if awarded):
Name: Bart Kreps, Vice President
Phone: 704.936.4438
Certified Small Business
State: NC Zip: 28202
E -Mail Address: bkreps@raftelis.com
Fax: 828.484.2442
E -Mail Address: bkreps@raftelis.com
Certifying Agency:
Certified Minority, Woman or Disadvantaged Business Enterprise
Certifying Agency:
Gas System Utility Rate Study Services 24 RFP #58-19
RAFTELIS 41
VENDOR CERTIFICATION OF PROPOSAL
By signing and submitting this Proposal, the Vendor certifies that:
a) It is under no legal prohibition to contract with the City of Clearwater.
b) It has read, understands, and is in compliance with the specifications, terms and conditions stated herein, as
well as its attachments, and any referenced documents.
c) It has no known, undisclosed conflicts of interest.
d) The prices offered were independently developed without consultation or collusion with any of the other
respondents or potential respondents or any other anti-competitive practices.
e) No offer of gifts, payments or other consideration were made to any City employee, officer, elected official, or
consultant who has or may have had a role in the procurement process for the services and or goods/materials
covered by this contract.
f) It understands the City of Clearwater may copy all parts of this response, including without limitation any
documents and/or materials copyrighted by the respondent, for internal use in evaluating respondent's offer.
or in response to a public records request under Florida's public records law (F.S. 119) or other applicable
law, subpoena, or other judicial process.
g) Respondent hereby warrants to the City that the respondent and each of its subcontractors ("Subcontractors")
will comply with, and are contractually obligated to comply with, all Federal Immigration laws and regulations
that relate to their employees.
h) Respondent certifies that they are not in violation of section 6(j) of the Federal Export Administration Act and
not debarred by any Federal or public agency.
i) It will provide the materials or services specified in compliance with all Federal, State, and Local Statutes and
Rules if awarded by the City.
j) It is current in all obligations due to the City.
k) It will accept such terms and conditions in a resulting contract if awarded by the City.
I) The signatory is an officer or duly authorized agent of the respondent with full power and authority to submit
binding offers for the goods or services as specified herein.
ACCEPTED AND AGREED TO:
Company Name: Raftelis Financial Consultants, Inc.
Signature:
Printed Nam
Title: Vice President
Date: 10/16/19
Gas System Utility Rate Study Services 25 RFP #58-19
42 CITY OF CLEARWATER
SCRUTINIZED COMPANIES FORMS
SCRUTINIZED COMPANIES AND BUSINESS OPERATIONS WITH
CUBA AND SYRIA CERTIFICATION FORM
IF YOUR BID/PROPOSAL IS $1,000,000 OR MORE, THIS FORM MUST BE COMPLETED AND
SUBMITTED WITH THE BID/PROPOSAL. FAILURE TO SUBMIT THIS FORM AS REQUIRED MAY
DEEM YOUR SUBMITTAL NONRESPONSIVE.
The affiant, by virtue of the signature below, certifies that:
1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the
requirements of section 287.135, Florida Statutes, regarding companies on the Scrutinized Companies with
Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Energy Sector List,
or engaging in business operations in Cuba and Syria; and
2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in
this solicitation and is not listed on either the Scrutinized Companies with Activities in Sudan List, the
Scrutinized Companies with Activities in the Iran Petroleum Sector List, or engaged in business operations
in Cuba and Syria; and
3. Business Operations means, for purposes specifically related to Cuba or Syria, engaging in
commerce in any form in Cuba or Syria, including, but not limited to, acquiring, developing, maintaining,
owning, selling, possessing, leasing or operating equipment, facilities, personnel, products, services,
personal property, real property, military equipment, or any other apparatus of business or commerce; and
4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary,
affiliate, or owner will immediately notify the City of Clearwater in writing, no later than five (5) calendar
days after any of its principals are placed on the Scrutinized Companies with Activities in Sudan List, the
Scrutinized Companies with Activities in the Iran Petroleum Sector List, or engaged in business operations
in Cuba and Syria.
STATE OF f i L--
1
Aute d gnature
Bart Kreps
Printed Name
Vice President
Title
Raftelis Financial Consultants, Inc.
Name of Entity/Corporation
COUNTY OF VVN ,,.
The foregoing instrument was acknowledged before me on this 1 t.P day of (9c v
20 14 , by Bart Kreps (name of person whose signature is being notarized)
as the Vice President (title) of Raftelis Financial Consultants: Inc. (name of
corporation/entity), personally known to me as described herein collo...- , or produced a
(type of identification) as identification, an84ho did/did not take an oath.
\9 //�I�r�e. �i c rum (....h6-4
\\\AEJ48'i V S
/, I' Lary Public
Q O : f G"> 'd Li- '1,1 c 4c._ .\ fin. bD
v PRY
� J Printed Name
O
Mi omAssion xf res:0 t --1-t Al
NOTARY A.SpAigkBOVE\
�/,//i vN� ON tC0\)� \\�
Gas System Utility Rate Study Services 26 RFP #58-19
RAFTELIS
SCRUTINIZED COMPANIES FORMS
SCRUTINIZED COMPANIES THAT BOYCOTT ISRAEL LIST CERTIFICATION FORM
THIS FORM MUST BE COMPLETED AND SUBMITTED WITH THE B1D/PROPOSAL.
FAILURE TO SUBMIT THIS FORMAS REQUIRED MAY DEEM YOUR SUBMITTAL
NONRESPONSIVE.
The affiant, by virtue of the signature below, certifies that:
1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the requirements
of section 287.135, Florida Statutes, regarding companies on the Scrutinized Companies that Boycott
Israel List, or engaged in a boycott of Israel; and
2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in this
solicitation and is not listed on the Scrutinized Companies that Boycott Israel List, or engaged in a
boycott of Israel; and
3. "Boycott Israel" or "boycott of Israel" means refusing to deal, terminating business activities, or taking
other actions to limit commercial relations with Israel, or persons or entities doing business in Israel or
in Israeli -controlled territories, in a discriminatory manner. A statement by a company that it is
participating in a boycott of Israel, or that it has initiated a boycott in response to a request for a boycott
of Israel or in compliance with, or in furtherance of, calls for a boycott of Israel, may be considered as
evidence that a company is participating in a boycott of Israel; and
4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary, affiliate,
or owner will immediately notify the City of Clearwater in writing, no later than five (5) calendar days
after any of its principals are placed on the Scrutinized Companies that Boycott Israel List, or engaged
in a boycott of Israel.
A red ignature
Bart Kreps
Printed Name
Vice President
Title
Raftelis Financial Consultants, Inc.
Name of Entity/Corporation
STATE OF .0C -
COUNTY OF U1A; .
The foregoing instrument was acknowledged before me on this 1114. day of 6.1-0.6.c7
20 V1 , by Bart Kreps (name of person whose signature is being notarized)
as the Vice President (title) of Raftelis Financial Consultants, Inc. (name of
corporation/entity), personally known to me as described herein C o l l Gc.SS v -c.. , or produced a
(type of identification) as identification, and-aiho did/did not take an oath.
�1�>GLGr 04t -4.4-c.. e._J
QQtary Public
J.e.»,,(,‘„- J . /-Lc_ a
Printed Name
�A1 1110
RI Ei SASS
O
—1>> 0
.r
My1Ol4mmissio��� pares:
NOTARY SES L.44BOVE
RY
U!`10N t?OJ\\\\
Gas System Utility Rate Study Services
27 RFP #58-19
43
Form W-9
(Rev. December 2014)
Department of the Treasury
Internal Revenue Service
Request for Taxpayer
Identification Number and Certification
Give Form to the
requester. Do not
send to the IRS.
I Print or type
See Specific Instructions on page 2.
1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank.
Raftelis Financial Consultants, Inc.
2 Business name/disregarded entity name, if different from above
3 Check appropriate box for federal tax classification; check only one of the following seven boxes:
4 Exemptions
certain ionsion,
instructions
Exempt payee
Exemption
code (if any)
(Applies to accounts
(codes apply only to
not individuals; see
on page 3):
code (if any)
I• Individual/sole proprietor or I� C Corporation F4 S Corporation
P P rP p I� Partnership I� Trust/estate
single -member
LLC
company. Enter the tax classification (C=C corporation, S=S corporation, P=partnership)
-member LLC that is disregarded, do not check LLC; check the appropriate box in
of the single -member owner.
I.
►
IIII Limited liability
Note. For a single
the tax classification
(.Other (see instructions)
from FATCA reporting
the line above for
maintained outside the U.S.)
5 Address (number, street, and apt. or suite no.)
227 W. Trade Street, Suite 1400
Requester's name and address (optional)
6 City, state, and ZIP code
Charlotte, NC 28202
7 List account number(s) here (optional)
Part I
Taxpayer Identification Number (TIN)
Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid
backup withholding. For individuals, this is generally your social security number (SSN). However, for a
resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other
entities, it is your employer identification number (EIN). If you do not have a number, see How to get a
TIN on page 3.
Note. If the account is in more than one name, see the instructions for line 1 and the chart on page 4 for
guidelines on whose number to enter.
Part II
Social security number
or
Employer identification number
2
0
1
0
5
4
0
6
9
Certification
Under penalties of perjury, I certify that:
1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me); and
2. I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue
Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am
no longer subject to backup withholding; and
3. I am a U.S. citizen or other U.S. person (defined below); and
4. The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct.
Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding
because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage
interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and
generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the
instructions on page 3.
Sign
Here
Signature of
U.S. person 10.U
Date ► 2019
General Instructions
Section references are to the Internal Revenue Code unless otherwise noted.
Future developments. Information about developments affecting Form W-9 (such
as legislation enacted after we release it) is at www.irs.gov/fw9.
Purpose of Form
An individual or entity (Form W-9 requester) who is required to file an information
return with the IRS must obtain your correct taxpayer identification number (TIN)
which may be your social security number (SSN), individual taxpayer identification
number (ITIN), adoption taxpayer identification number (ATIN), or employer
identification number (EIN), to report on an information return the amount paid to
you, or other amount reportable on an information return. Examples of information
returns include, but are not limited to, the following:
• Form 1099 -INT (interest earned or paid)
• Form 1099 -DIV (dividends, including those from stocks or mutual funds)
• Form 1099-MISC (various types of income, prizes, awards, or gross proceeds)
• Form 1099-B (stock or mutual fund sales and certain other transactions by
brokers)
• Form 1099-S (proceeds from real estate transactions)
• Form 1099-K (merchant card and third party network transactions)
• Form 1098 (home mortgage interest); 1098-E (student loan interest), 1098-T
(tuition)
• Form 1099-C (canceled debt)
• Form 1099-A (acquisition or abandonment of secured property)
Use Form W-9 only if you are a U.S. person (including a resident alien), to
provide your correct TIN.
If you do not return Form W-9 to the requester with a TIN, you might be subject
to backup withholding. See What is backup withholding? on page 2.
By signing the filled -out form, you:
1. Certify that the TIN you are giving is correct (or you are waiting for a number
to be issued),
2. Certify that you are not subject to backup withholding, or
3. Claim exemption from backup withholding if you are a U.S. exempt payee. If
applicable, you are also certifying that as a U.S. person, your allocable share of
any partnership income from a U.S. trade or business is not subject to the
withholding tax on foreign partners' share of effectively connected income, and
4. Certify that FATCA code(s) entered on this form (if any) indicating that you are
exempt from the FATCA reporting, is correct. See What is FATCA reporting? on
page 2 for further information.
Cat. No. 10231X Form W-9 (Rev. 12-2014)