HomeMy WebLinkAboutAgreement_General_11/03/2007VILY~~GE ®F TEQiJEST'A
Post Office Box 3273 ~ 345 Tequesta Drive
Tequesta, Florida 33469-0273 ~ (561) 575-6200
Fax: (561) 575-6203
November 14, 2007
Mr. Rob Ori
Public Resources Management
341 N. Maitland Avenue, Suite 300
Maitland, FL 32751
Dear Mr. Ori:
Enclosed are two originals of the "Agreement to Provide Utility Consulting Services
for Updated Utility Financial Forecast". Please initial the change made to page 2 as
agreed upon during a telephone call with Mr. Couzzo, Village Manager on 11/13/07 at
4:40 p.m.
Please return one original to me for the Village Clerk's official files and retain the other
original for your files. Please contact me at 561-575-6200 ext. 244 if you have any
questions.
Sincerely,
Lori McWilliams, CMC
Village Clerk
Cc: Michael Couzzo, Village Manager
Recycled Paper
Public Resources Management Group, Inc.
September 28, 2007
Mr. Michael R. Couzzo
Village Manager
Village of Tequesta
P.O. Box 3273
Tequesta, FL 33469-0273
Subject: Agreement to Provide Utility Consulting Services -For Updated Utility
Financial Forecast
Dear Mr. Couzzo:
As we discussed and based on the request made by the Village of Tequesta (the "Village"),
Public Resources Management Group, Inc. (PRMG) is pleased to submit this letter agreement
(the "Agreement") to provide certain utility financial consulting services on behalf of the
Village's water utility system (the "System"). Based on discussions with the Village, the primary
responsibilities of PRMG as it relates to this project is to i) prepare updated financial projections
of the System (the last financial forecast being prepared during the Fiscal Year 2005)
recognizing known. and anticipated changes to such System; ii) identify trends in utility margins,
the ability to meet rate covenants requirements, and other factors such that the Village can make
an informed decision of the business aspects of operating and financing such System; and
iii) evaluate current water rate structures and suggest modifications where considered reasonable
by PRMG (the "Project"). Based on our understanding of the needs of the Village, we propose
the following:
PROJECT TEAM AND BILLING RATES
With respect to the performance of this engagement, Mr. Robert J. Ori, principal-in-charge for
the project, and Mr. Jeff Wilson, project manager for the engagement will serve as primary
contacts between the Village and PRMG. PRMG may utilize other employees or associates
during the course of the engagement as needed. The services covered by this Agreement shall be
provided based on the direct labor rates set out in Attachment A which is made a part of this
Agreement.
SCOPE OF SERVICES
The scope of services to be performed by PRMG is summarized on Attachment B, which is
made a part of this Agreement.
I: AU056\2007forecast Ltr Agmt.doc
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Mr. Michael Couzzo ~
Village of Tequesta ~o~ ~ ~~~3~n~
September 28, 2007 ° ~
Page 2 ~- ~
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CO NSATION AND BILLING ~.f
used on the Scope of Services as summarized herein in Attachment B and the direct hourly
labor bi rates as shown on Attachment A herein, we propose anot-to-exceed budget of
0 for the project. A summary of the cost estimate is included on Attachment C to this
Agreement. This project cost estimate is considered as a total cost for the engagement and not a
"by-task" contract. The billings for the services provided pursuant to this Agreement and in
accordance with the project budget will include the direct cost of personnel anticipated to be
assigned to the project as well as any other direct costs such as travel, telephone, and copying,
printing and shipping charges and subconsulting expenses. The costs incurred by PRMG for
such other direct costs, if any, will be billed based on the actual cost or the standard unit cost
rates as summarized on Attachment A.
PRMG will bill the Village for -the consulting services rendered on behalf of its utility system on
a monthly basis predicated on the sum of i) direct labor cost based upon the actual hours of
service furnished toward the completion of the Project; ii) any other direct expenses incurred
during the month associated with the Project; and iii) the cost of any subconsulting services.
PRMG does not anticipate the need to require the use of subconsulting services during the course
of this Project. To the extent that PRMG determines a need for subconsulting services, PRMG
will notify the Village of such need and will not use any subconsultant without the approval by
authorized Village personnel, as may be required. No additional services above the cost estimate
will be performed without the prior written authorization by the Village.
The services provided by PRMG will be billed on an hourly basis predicated on the actual work
effort performed by PRMG and not on a lump-sum basis. To the extent that the Project is
completed at a cost less than the proposed contract budget as identified in this Agreement,
PRMG will not invoice the Village for any amounts remaining (unbilled) on such contract except
for the provision of any additional services which the Village may request from PRMG, as
mutually agreed between all of the parties.
PROPOSED TERM OF AGREEMENT
The term of this Agreement and the associated billing rates for the PRMG shall be in effect and
continue through the completion of the Project as identified in the scope of services which is
made a part of this Agreement or through March 31, 2008, whichever occurs first. It is
anticipated that the preparation of the Water System financial forecast and rate review activities
(reference is made to Section B regarding the Scope of Services) will be submitted to the Village
within 90 days after being given authorization to proceed for consideration by the Village
Council. The completion of the analysis will be subject to the availability of information
provided to PRMG by the Village that is considered as being necessary to conduct our evaluation
of the sufficiency and potential redesign of the Village's retail water rates.
K:A\1056\2007forecast Ltr Agmt.doc
Mr. Michael Couzzo
Village of Tequesta
September 28, 2007
Page 3
STANDARD TERMS AND CONDITIONS
Included on Attachment D are PRMG's Standard Terms and Conditions as it relates to providing
services to the Village which are made a part of this Agreement.
We have enclosed two copies of this Agreement to provide consulting services to Village for
your consideration and authorization. If this Agreement is acceptable to the Village, please
execute both copies of the Agreement and return one copy to our offices; the other copy is for the
Village's files and reference. We appreciate the opportunity to assist the Village in providing
utility consulting services on behalf of the Village's utility system and look forward to working
with the Village, and you on this project in the near future.
Very truly yours,
ACCEPTED BY:
Public Resources Management Group, Inc. Village of Tequesta, Florida
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Robert J. Ori Michael R. Couzz
President anager
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ATTACHMENT A
VILLAGE OF TEQUESTA, FLORIDA
UTILITY CONSULTING SERVICES -UPDATED UTILITY FINANCIAL FORECAST
SCHEDULE OF DIRECT LABOR HOURLY RATES AND STANDARD COSTS
DIRECT HOURLY RATES
Direct Labor
Project Team Title Hourly Rates [*]
Principal $160.00
Associate $125.00
Managing Consultant $110.00
Supervising Consultant $100.00
Senior Consultant $ 90.00
Rate Consultant $ 80.00
Consultant $ 70.00
Senior Rate Analyst $ 65.00
Rate Analyst $ 60.00
Analyst $ 50.00
Assistant Analyst $ 40.00
Administrative $ 48.00
[*] Direct labor hourly rates effective to March 31, 2008; rates will be
adjusted by not more than five percent (5%) per annum (rounded to the
nearest dollar) or as mutually agreed between parties for invoices
rendered after April 1 of each year thereafter until project completion or
termination of the agreement.
STANDARD COST RATES
Expense Description Standard Rates (*]
Mileage Allowance -Personal Car Use Only $48.5 per mile
Reproduction (black and white) (in house) $0.05 per page
Reproduction (color) (in house) $0.25 per page
Reproduction (contracted) Actual Cost
Computer Time $0.00 per hour
Telephone Charges Actual Cost
Delivery Charges Actual Cost
Lodging/Other Travel Costs Actual Cost
Meals Not to exceed per
PRMG Employee
$8.00 -Breakfast
$12.00 -Lunch
$25.00 -Dinner
Subconsultant Services Actual Cost plus 5.0%
Other Costs for Services Rendered Actual Cost
[*] Standard cost rates effective to March 31, 2008; rates will be adjusted by not more than
five percent (5%) per annum (rounded to the near est dollar) or as mutually agreed
between parties for invoices rendered after April 1 of each year thereafter until project
completion or termination of the agreement.
R:\\1056\2007forecast Ltr Agmt doc
A-1
ATTACHMENT B
VILLAGE OF TEQUESTA, FLORIDA
UTILITY CONSULTING SERVICES -UPDATED UTILITY FINANCIAL FORECAST
SCOPE OF SERVICES
The scope of services to be performed by PRMG shall include the following activities.
Task 1 -Data Acquisition and Review. PRMG will review data compiled by and provided by the
Village relative to the operation of the System. The data which will be required for the completion
of the study will include, but not be limited to: i) detailed customer statistical data; ii) historical
and budgeted revenue and expenditure information, including copies of the operation and
management contracts for the daily operations of the System; iii) financial data associated with
System operations; iv) capital expenditure planning data; v) utility rate tariff, agreements for bulk
service, etc.; vi) and other information deemed necessary by the Village and PRMG necessary to
complete the Project. PRMG will prepare a data request for response by Village in order to
compile the necessary information required for the study. PRMG will attend a "kick-off' meeting
with the Village to review the compiled information and discuss/identify issues associated with the
operations and long-term financial planning of the System.
Task 2 -Historical Customer and Financial Compilation Based on the availability of data;
PRMG will prepare up to a three fiscal year compilation of the: i) customer accounts, water and
wastewater sales (gallons sold), water production; and wastewater treatment requirements; and
ii) the revenues and expenses in a format consistent with the utility budget and the financial
forecast model. The purpose of this analysis will be to identify trends in water/wastewater use per
customer, system growth, and capacity needs and to develop parameters for the escalation of
operating expenses and other system revenue requirements. Additionally, and in order to review
water rate structure, PRMG will evaluate compiled detailed customer billing information by class,
month, and rate code for the most recent twelve months or recently completed fiscal year. PRMG
will develop a revenue reconciliation analysis to validate the billing statistics. This analysis will
also assist in the development of an updated revenue model (forecast) and for rate evaluation
System impact analyses.
Task 3 -Customer and Sales Forecast. PRMG will update the projection of the water customers
and sales (flow) for the Forecast Period as hereinafter defined. The forecast will encompass a
five-year analysis period which will include the Fiscal Year 2008 (the "Test Year") and the
subsequent four fiscal years ending September 30, 2012 (collectively, with the Test Period, the
"Forecast Period"). The forecast will be based on recent trends and the billing analysis conducted
in Tasks 1 and 2 and will be prepared based on the customer classes/rate design standards
currently in effect or planned based on the rate objectives or policies of the Village. The forecast
will be developed by customer class with a projection of revenues being developed for the
application of monthly rates consistent with the results of the customer forecast.
Task 4 -Rate Revenue Forecast. PRMG will prepare a forecast of the anticipated sales revenues
of the System based on the customer growth statistical scenarios prepared during the Task 3
activities of the project. The rate revenue forecast will be based on the usage characteristics and
accounts served for each class of customer to identify rate revenue contribution and possible issues
for the design of rates.
K:\U 056\2007forecast Ltr Agmt.doc $-1
Task S -Revenue Requirements. PRMG will prepare a projection of the revenue requirements of
the System for the Forecast Period. The revenue requirements will be based on assumptions
prepared by PRMG and provided by others and will include: i) the operating expenses of the
utility; ii) existing and anticipated debt service requirements; iii) capital expenditures and
associated funding sources; iv) Village administration, contract management and other expense
allocations; and v) other expenditure requirements. This task will also include the identification of
other revenues available to fund the expenditure requirements of the System. This will include
other System operating revenues, interest or investment earnings, the use of available
funds/reserves, and other revenues. The purpose of this task will be to identify the overall
expenditure needs or revenue requirements that will be recovered from rates and to assist in rate
phasing/implementation analyses.
Task 6 -Capital Funding Analysis. PRMG will incorporate a capital funding analysis as part of
the determination of the Test Year revenue requirements of the System. The analysis will include
the identification of the capital expenditure needs as identified by the Village staff and its
consulting engineers and the development of a funding plan for such capital needs. The funding
analysis will recognize currently available uncommitted reserves, use of additional Senior Lien or
Subordinate Lien bonds, and other sources as identified with Village staff. An estimate of Test
Year interest earnings available to be earned on available cash balances will also be performed
during this task.
Task 7 -Rate Structure Evaluation. Based on available customer statistical information, PRMG
will review the current rate structure in effect for the System and will make recommendations for
adjustments that PRMG believes is fair and reasonable. Additionally, PRMG will review the rate
revenue impact associated with any change in rate structure which will be included as a
component of the financial forecast developed in previous tasks. If considered necessary, PRMG
will design System-wide rate revisions to recover the effects of any change in rate structure as
considered necessary by the Village.
Task 8 -Customer Impact Anal~is. In order to assist the Village in the evaluation of the
proposed financial plan and the affects of any system rate adjustments that may be identified,
PRMG will prepare a rate comparison of the Village's existing and any Test Year proposed water
rates with other neighboring jurisdictions to identify the competitiveness of the required rates for
utility service.
Task 9 -Report Preparation and Presentation. PRMG will prepare a letter report or technical
memorandum that will document the analyses, assumptions used and the conclusions of each task
described above. The purpose of the report is to document the results of the study and to possibly
initiate the capital improvement financing process. The letter report or technical memorandum
will be prepared in draft form for Village management review and in final form for use by the
Village management for presentation to the Village Board.
Task 10 -Rate Ordinance Review. To the extent that a change in rate structure or level is made as
a result of the PRMG analysis/recommendations,. PRMG will review the Rate Ordinance as
prepared by the Village's Legal Counsel to verify that the proposed changes are accurately
reflected in such proposed Rate Ordinance.
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Task II - MeetinQS. During the course of the project, it is anticipated that PRMG will attend
several meetings with the Village management and its consultants/advisors to review the analyses
and present the results of the financial forecast. For the purposes of this scope of services, it is
recognized that PRMG will attend three (3) meetings by not more than two (2) employees of
PRMG. The meetings may be attended by teleconferences or by actual site visits, depending on
need and contract budget. The meetings identified in this scope of services include:
Data ReviewlKickoff Meeting
Analytical Meeting/Review Results
Presentation to Council
Number of Meetings
1
1
1
Total Number of Meetings _~
Additional Services
During the course of the study, the Village may request additional services from PRMG.
Although no additional services are anticipated at this time, PRMG will perform such services
only as mutually agreed between the Village and PRMG in writing. Examples of utility rate
consulting services which would be considered as an additional service include, but are not limited
to, the following activities:
l . Attendance of meetings in addition to what is anticipated in this scope of services.
2. Development of several financial or capital funding .scenarios in additions to what is
generally described and contemplated in this scope of services and the preparation of a
multi-year forecast of System revenue requirements.
3. The development of a detailed rate evaluation (design of rates by System allocation of
revenue requirements associated with the preliminary findings of the financial forecast).
4. The development of a Bond Feasibility Report or any other related financing documents or
reports necessary for the funding or securing of funds for the construction of capital
improvements to the System.
5. Performance of additional financial and rate analyses subsequent to substantial completion
of the scope of services identified herein or due to delays in the project which is not the
fault of PRMG.
K:\U 056\2007forecast Ltr Agmtdoc B-3
Line
No. Activity
1 Project Billing Rates ($/Hr.)
2 Data Acquisition and Review
Customer Statistical and Revenue Forecast
3 Historical Customer and Financial Compilation
4 Billing Analysis for Rate Structure Evaluation
5 Customer and Sales Forecast
6 Rate Revenue Forecast
Revenue Requirements
7 Utility Expendiure Forecast Forecast
8 Capital Funding Analysis
9 Water Rate Evaluation
10 Customer Impact Analysis
11 Letter Report Preparation and Presentation
12 Review of Rate Ordinance
13 Meetings (3 meetings)
14 Project Management Allowance (% of Total Hours)
IS Total Project Hours
16 Total Direct Labor Cost -All Tasks
17 Average Hourly Billing Ra[e
18 Allowance for Indirect Costs
19 Telephone Allowance
20 Travel (3 Trips x 325 miles x $.485/ Mile)
21 Miscellaneous Expense Allowance
22 Total Allowance for Indirect Costs
23 Total Estimated Project Cost
Attachment C
Village of Tequesta, Florida
Preliminary Job Cost Estimate for to Develop of a Water System Financial Forecast
Task
Reference
1
2
2
3
4
5
6
7
8
9
10
11
All
Project Supervising Senior Rate Rate Clerical
Manager Consultant Consultant Consultant Analyst Analyst & Admin.
$160.00 $105.00 $95.00 $65.00 $55.00 $45.00 $45.00
6 - 12 - - - 4
1 - 6 - 16 - -
2 - 6 - 24 - -
2 - 5 - 12 - -
1 - 2 - 6 - -
3 - 16 - 16 - -
5 - 12 - 10 - -
2 - 6 - 4 - -
1 - 4 - - - -
2 - 10 - 6 - 14
2 - 1 - - - 1
14 - 8 - _ _ g
2 - - - - - 2
43 - 88 - 94 - 29
$ 6,880 $ - $ 8,360 $ - $ 5,170 $ - $ 1,305 $
22
23
3~
19
9
35
27
12
5
32
4
30
4
254
21,715
$85.49
100
473
212
785
$22,500
Page 1 of 1
Totals
TequestaFinForecastCostEstUpdate2007.x1w 9/28/2007 12:34 PM
ATTACHMENT D
VILLAGE OF TEQUESTA, FLORIDA
UTILITY CONSULTING SERVICES -UPDATED UTILITY FINANCIAL FORECAST
STANDARD TERMS AND CONDITIONS
I. SCOPE
Public Resources Management Group, Inc. (PANG)
agrees to perform the financial consulting services
described in the agreement that incorporates these
standard terms and conditions. Unless modified in
writing by the parties hereto, the duties of PRMG shall
not be construed to exceed those services specifically
set forth in the agreement.
Client agrees to indemnify, defend, and hold PRMG
harmless from and against any liability arising out of
the negligent errors or negligent omissions of Client,
its agents, employees, or representatives, in the
performance of duties set forth in Article I.
V. INSURANCE
II. COMPENSATION
The Client, as defined in the agreement, agrees to pay
for the services as billed within thirty (30) days of
receiving the invoice. Amounts paid after thirty (30)
days may be subject to interest charges.
Time-related charges will be made in accordance with
the billing rate referenced in the agreement. Other
indirect expenses and subcontractor services, if any,
will be billed in accordance with the standard unit cost
rates as referenced in the agreement or if no reference
is provided, at cost.
III. RESPONSIBILITY
PRMG is employed to render a professional service
only, and any payments made by Client are
compensation solely for such services rendered and
recommendations made in carrying out the work.
PRMG shall perform analyses, provide opinions,
make factual presentations, and provide professional
advice and recommendations.
IV. INDEMNIFICATION
PRMG agrees to indemnify, defend, and hold Client
harmless from and against any liability arising out of
the negligent errors or negligent omissions of PRMG,
its agents, employees, or representatives, in the
performance of duties set forth in Article I.
PRMG shall maintain during the life of the agreement
the following minimum insurance:
1. Commercial general liability insurance, including
hired and non-insured automobiles, with the
following limits:
Each Occurrence $1,000,000
Damage to Rented Premises
(Each Occurrence) $300,000
Medical Expense (Any one person) $5,000
Personal and Advertising Injury $1,000,000
General Aggregate $2,000,000
Products -Completed/Operation
General Aggregate $2,000,000
2. Statutory worker's compensation and employers'
liability insurance as required by state law.
3. Professional liability insurance at a limit of
liability of not less than $500.000.
VI. ASSIGNMENT
These terms and conditions and the agreement to
which they are attached are binding on the heirs,
successors, and assigns of the parties hereto. This
agreement may not be assigned by Client or PRMG
without prior, written consent of the other.
K:U 056\200~forecast Ltr Agmt.doc D_ 1
VII. INTEGRATION
These terms and conditions and the agreement to
which they are attached represent the entire
understanding of Client and PRMG as to those matters
contained herein. No prior oral or written
understanding shall be of any force or effect with
respect to those matters covered herein. The
agreement may not be modified or altered except in
writing signed by both parties.
VIII. JURISDICTION
This agreement shall be administered and interpreted
under the laws of the State of Florida. Jurisdiction of
litigation arising from the agreement shall be in that
state. If any part of the agreement is found to be in
conflict with applicable laws, such part shall be
inoperative, null and void insofar as it is in conflict
with said laws, but the remainder of the agreement
shall be in full force and effect.
IX. SUSPENSION OF WORK
Client may suspend, in writing, all or a portion of the
work under the agreement in the event unforeseen
circumstances beyond Client's control make normal
progress of the work impossible. PRMG may request
that the work be suspended by notifying Client, in
writing, of circumstances that are interfering with the
normal progress of work. PRMG may suspend work
on the project in the event Client does not pay
invoices when due. The time for completion of the
work shall be extended by the number of days work is
suspended. In the event that the period of suspension
exceeds 90 days, the terms of the agreement are
subject to renegotiation and both parties are granted
the option to terminate work on the suspended portion
of the project.
X_ TERMINATION OF WORK
Client may terminate all or a portion of the work
covered by the agreement for its convenience. Either
party may terminate work if the other party fails to
perform in accordance with the provisions of the
agreement. Termination of the agreement is
accomplished by 15 days prior written notice from the
party initiating termination to the other. Notice of
termination shall be delivered by certified mail with
receipt for delivery returned to the, sender.
In the event of termination, PRMG shall perform such
additional work as is necessary for the orderly filing
of documents and closing of the project. The time
spent on such additional work shall not exceed five
percent (5%) of the time expended on the terminated
portion of the project prior to the effective date of
termination. PRMG shall be compensated by the
client for work actually performed prior to the
effective date of termination plus the work required
for filing and closing as described in this Article.
XI. ARBITRATION
All claims, disputes and other matters in question
between the parties to this agreement arising out of or
relating to this agreement or the breach thereof, which
are not disposed by mutual agreement of the parties,
shall be decided by arbitration in accordance with the
Florida Arbitration Code. No arbitration arising out of
or relating to this agreement shall include any person
not a party to this agreement except by written consent
containing a specific reference to this agreement and
signed by the parties hereto and persons to be joined.
This agreement to arbitrate shall be specifically
enforceable under prevailing arbitration law.
Notice of demand for arbitration shall be filed in
writing with the other parties to this agreement. The
demand shall be made within a reasonable time after
the claim, dispute or other matter in question has
arisen, but in no event after the date when the
institution of legal or equitable proceedings would be
barred by the applicable statute of limitations. The
award rendered by the arbitrators shall be final and
judgment may be entered in accordance with
applicable law in any court having jurisdiction.
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