Agenda - View Meetings (All) (0811925728)

7.15.

Regular City Council Meeting

Meeting Date:

08/24/2021

Information

Agenda Item

Resolution - Water Utilities: Consider a resolution authorizing the Mayor to execute a Amendment No. 2 to Professional Services Agreement 14327, with NewGen Strategies and Solutions, LLC, for continued consulting services related to updating existing water and wastewater rate models and cost of services.

Item Summary

The periodic evaluation of the City's current water and wastewater rate structure is an essential step in optimizing 3 objectives associated with water and wastewater rates. These 3 objectives include revenue stability, affordability, and water conservation. Bond rating agencies strongly encourage utilities to evaluate their rate structure periodically.

The City’s most recent water and wastewater rate evaluation was performed in 2016 by NewGen Strategies. The City’s water and wastewater cost of services were updated and the water and wastewater rate structures were evaluated to determine whether objectives were being met through the existing rate structures. NewGen Strategies worked with staff and the Lubbock Water Advisory Commission to develop rate recommendations. In September 2017, the City Council adopted recommended modifications to the residential water rate structure. In addition, the City Council adopted recommended wastewater rates for all customer classes without changing the wastewater rate structure. Changes to the commercial water rate structure were not considered.

On October 9, 2018, the original agreement associated with this amendment was executed by the City of Lubbock. A portion of the work performed by NewGen Strategies included further consideration of the commercial water rate structure. Amendment No. 1 was executed on February 25, 2020, and included additional funding to provide support to staff for financial forecasting and rate model enhancements.

This is Amendment No. 2 to the original agreement with NewGen Strategies, for continuing support to staff in updating revenue requirements, financial forecasting, cost of service updates, and rate model enhancement for the Water and Wastewater Enterprise Fund. This amendment extends the agreement for an additional 12 months without amending the existing contract amount of $81,500.

Fiscal Impact

None

Staff/Board Recommending

Jesica McEachern, Assistant City Manager
Lubbock Water Advisory Commission

Attachments

Resolution

Amendment 2- NewGenAgreement