The wastewater service agreement between the City and Lockwood Water & Sewer District (District), approved by the Council on March 24, 2008, includes a provision for conducting a rate study to determine the user rates and system development fees.  An additional condition is that the District pay for the study.  The subject contract amendment with Red Oak Consulting in the amount of $69,884 covers the work necessary to conduct the required study.

Red Oak Consulting is the firm that completed the rate and SDF study for the City in 2006.  Because of the firm's familiarity with our system as well as having the financial models for determing the rates, staff believes it is the most logical choice for doing this work with the least effort.  In order to complete the study in a timely fashion, staff requests the Council approve the contract amendment at the September 28 meeting. 

The Council may:

1. Approve the contract amendment; or
2. Not approve the contract amendment.

Since the rate study is required per the service agreement, the District is paying for the study, and timely completion is important, staff urges approval of the contract amendment.

Since the District is paying for the study as approved by its Board (see attachment), there is no direct financial impact to the City.