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Home My WebLink About1993 05 10 - GDU Request for increaseINDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:33 Nu.011 P.02 UTIL (WAGGDUIN.CEw)!c&w INDIAN RIVER COUNTY AGENDA -92121 DATES MAY 10, 1993 TO: JAMES E. CHANDLER COUNTY ADMINISTRATOR FROM: TERRANCE G. PINTO DIRECTOR OF UTIL VICEB STAFFED AND PREPARED BY: CINDY E. WHIT" ` FRANCHISE COORb R DEPARTMENT OF LITY SERVICES SUBJECT: GENERAL DEVELOPMENT UTILITIES, INC. (GDU) REQUEST FOR AN INCREASE IN WATER AND SEWER RATES, CARRYING COST RECOVERY CHARGES, AND SERVICE AVAILABILITY CHARGES FOR THE VERO BEACH HIGHLANDS AND VERO BEACH SHORES DIVISION On May 3, 1993, the Department of Utility Services received the attached rate increase package from General Development Utilities, Inc. Upon receipt of the package, the attached memo wee prepared and sent to the Board of County Commissioner& outlining the public hearing process and recommendation to hire an independent accounting firm to review the rate increase request. In accordance with Franchise Resolution 83-109, a public hearing before the Hoard of County Commissioners must be hold within 90 days after receipt of the rate increase request, within 6o days after said public hearing, the Board of County Commissioners must approve or disapprove the rate increase. This department recommenda that the firm of Rachlin & Cohen of Miami, Florida, ba hired to review the rate increase package and determine an acceptable rate base. This company has experience in dealing with GDU, and has an excellent reputation in the analyses of rate increase requests. Per Resolution 91731, the cost of hiring this GDU. firm would be paid by The Departmant of Utility Sarvicas recommends that the Board of County Commissioner& authorize the Department of Utility Savvican to proceed with an mgraament with Rachlin & Cohan, in accordance with the attached proposal in the not -to -exceed amount of $15,590.00, to review the rate increase package submitted by GDU. The date of a public hearing to review the package within a 90 -day time frame will be determined at a later Aa*e /caw Attachmentai APPROVED FOR AGENDA: �-. BY le,s.. James E. C an ar County Administrator FOR_ S — / 1 — F-:? Date i I r1l�T'��►J� ��fi�-ctlr `.✓ INDIAN RIVER COUVITY ID:407-770-5095 MAY 18'93 16:34 hIo.011 P.03 UTIL(NGDURATE.TGP)tcw INDIAN RZVER COUNTY DEPARTMENT OF UTILITY SERVICES INTEROFFICE MEMORANDUM DATE: MAY 5, 1993 TO. BOARD OF COUNTY COMMIS OVERS THRUi JAMES E. CHANDLER COUNTY ADMINISTRATO$� FROM. TEUUkNCE G_ PI ; DIRECTOR OF VTIl Y,- V CES SUBJECT. GENERAL DEVELOPMENT UTILITIES, INC. -- REQUEST FOR AN INCREASE IN WATER AND SEWER RATES, CARRYING COST RECOVERY CHARGES, AND SERVICE AVAILABILITY CHARGES FOR THE VERO BEACH HIGHLANDS AND VERO BEACH SHORE& DIVISION On May 3, 1993, thin office received the attached. rate increase Package from General Development Utilities, Inc. (GDU). An average bill for residential customers Is anticipated to increase approximately 91.51 for water and 1550 for newer. According to Franchise Resolution 83-109 between Indian River County and GDU (sae Attachment A), within 90 days after receipt of GUU's schedule of proposed rates and charges, a public hearing must be held before the Board of County Commissioners. The Board must approve or disapprove the rate increase within 60 days after said public hearing. The applicant has requested the appointment of an Independent hearing officer because of an :the possibility of a conflict due to the Utility's request to sell the utilities operation to the County. We recommend against hiring a hearing otticorj however, we do recommend hiring an independent accounting firs specializing in utilities rete --analyses. The firs would review ODUte financial statements and establish an acceptable rate base. We recommend the firm of Rachlin i Cohen of,Niasi,who -is extremely competent and experienced in dealing with GDU. Asper ordinance, this cost becomes part Of the applicant's cont. Attachments B through E represent the components of the rate increase request, of which requires an in-depth review. Your careful review of the attached willindicate how complex such e review is. Upon completion of a review and analysis of the rate increase request, I will schedule the required public Board. hearing before the TCP: Cow Attachments CC! Charles P. Vitunac, County Attorney Harry E_ Asher, Assiatant Director of Utility Sarvioea Ted Monroe, project Coordinator, Dept. of Utility Services INDIRN RIVER COUNTY ID:407-770-50_95 MRY 18'93 16:35 No.011 P.04 87MMPf F. RES0LMON 83-109 All of the east ;5 of Section 350 and all of Section 36. Of 2b60nahip 33 South, Range 39 Fast, and the Southeast 4 of the Southeast 41 of Section 30, that portion of the Southwest % of the Southwest 41 of Section 29 bounded on the Fbst by the Indian River West Shoraline, all of section 31, and that portion of the West 15 of Section 32 bound d on the E&&,- by the Indian River Wast Shoreline in lbwnship 33 South, Ranga 40 rest. 2. rection 17 of the original resolution is hereby anannded to read as follows; SFL`PICN 17 a. 1300OPt as provided in paragraph b of this section should tl,e Utility desire to adjust any c}argea heretofore established and approved by the Board, then the Utility shall notify end make -Application to the Board in writing, setting forth a schedule of rates and charges which it ProFoess. Within ninety (90) days attar natio* as aforesaid, the Board shall hold a public hearing on such request. ratios of which shall be given by Publication in a Mwspaper regularly published in said County, at least ane tiara not Pore than one sonth nor less than one week preceding such hearing. Ceed rtifiProof of publication of such notice shall be S.rg filed with the Board. The Board will approve or disapprove said increase in rags within sixty (60) days after said public hearing. If the Board has not acted within one hundred twenty (120) days after the initial notice by the Utility, then the Utility may forthwith put such asvidad schedule of rates and charges into effect. If the Utility should raise rates or charges As hereinabove stated prior to action us the B� the difference between the 1Prplalrntad rates and the Previously authorized rates shall be collected under bond and mjbject to refund for a period of one hundred twenty (120) days. Upon the expiration of said one hundred twenty (120) day Period, if no action has been taken by the Board, there shall be no further obligation on the part of the Utility to refund any nomas, and the bond will no longer be in force, end the increase in rates or charges shall continue as if therequest of the Utility had been granted. If the Board enters an order approving or disaPproving the rate increase prior to the tint the request is de erred to have been granted, and the Utility or any Person feels aggrieved by such order, then the Utility or such Person may senk review of the IhaLdrs action by prooeedings in the Circuit Court of the County. b. If at any time the Utility is purchasing all or Any portion of its utility services from Indian River County and redistrih uting such services to its customers, the Utility's rates to its customers shall be E AT'A1'I111F.NT A �VJ INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:35 N0.011 P.05 autrnatiaally increased or decr oad without hearing, upon verified notice to the Board thirty (30) days prior to the utility's . isplenentation of the increase or dx,r sa that the rata" charged to the Utility by Indian River County or its successor have larged. ,Before inpinmranting a danger in rates under thio section, the Utility ah"ll file an affirmation rwder oath as to the accuracy of the figures and calculatirn upon which the charge in rates le basad, stating that the longe is designed to increase or decrease the utility's revenues by no more than the amount of the additional charge Imposed on the Utility by the County. 3. A new Section 23 is added to the -.original resolution, as amended, to read as follows: S"MON 23 Within thirty (3o) days after the first anniversary of the effective date of this section and within thirty (30) days after each succeeding anniversary of the effective date of this aecti.on, the Utility, its muccossors or nasigns, shall pay to the Canty or its auccesaora an amount which, .u} -sen added to the anount of all coanty taxes, licenses and other impositions levied or imposed upon the Utility's property, business or operations for the preceding tax year, will equal six percent (61k) of groes company revenues (excluding contributions-in-aid-pf--construction and eaw>ection larges) from the Dale of water and newer aerviee to residential and commerchal customnrs served by the Utility's systems in Vero Shores and Voro Beach Highlands Within the unincorporated area of the Canty for the twelve fiscal months preceding the applicable anniversary date. the franchise fee shall be collected from, and stall be shown as a separate item on the Utility's bills to its customers. 'lore Utility shall supply the County with a copy of the Utility' n annual report and financial statements. All records and .all accounting Of Utility shall be in accordance with the Uniform System of Accounts of the National Association of Regulatory Utilities Commissionera and general accepted accounting principles. within ninety (90) days after close of fisanl year, the utility shall su)mit financial stntc3me.ntn prepared by a CPA and in accr)rdance with general nocepted accounting BL: axos and Wua7C. -Upon demand by the Baird the utility will submit audited financial statements certified by a CPA. Also, a letter from a CPA certifying that the six 16) percent franchise fee ham been col).ncted and disbursed in accordance with the terms of this Agr,eertent. 41e Canty reserves the right to adopt, in addition to the provisions herein contained and exlsting applicable resolutions or inure, 3 INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:36 Nu.011 P.06 CwntOi wLVw n [2 JAY[\ L wtK• •wuN w .i{uy 4 TNt[[M •Lrllw wD [L VI1\rTH 4 •UWNAM WrLLYN L WIq N wMNwwO t {wpNTY.tN 1'ttew G OVM NrNONgN -M LrN ►Nq Nco Or'w{ D.nO\k ryeuN N. pw[[ry [ L. wows.ND I4 ry. [. WfTN[T\ nK'NwwO O. MCL\pN wNLLYN O. wwC\TON CwwOLTN L wwC ryLC awwT w. 4N{ b\CA R \MnN CN[A•L D. \TWAT HOPPING 90YD GREEN S. $^MS ATTORNLYS AND e.VNS.LON, ran ooI ew ouN STNZt ro\T orr,Q ID[ all, TALLANASeci, WLOR(o^.1Q.1(♦ (\Oq \\\-T900 rw[ ({w) April 3o, 1993 Mr. Terry Pinto Utility Service& Director Indian River County 1840 - 25th Street Vero Beach, FL 32960 a wukN aLw, Jw. JONwr.wr {. Ipl JANk• G pOODtCTT WrN [. Nv.rrcq ./w. GI+.NA W. .roNN{ON wrcNAwo w. [Iopw[ wrq [u w. ..cww�{0N ..wwr{eL N. w�ND�{oN twonw •pTD ITwwC[ owrN y. Kwwp ..rcNwcL n Ik*wu.ncN OOIIOW L w0{[wry Jouc ► woNk [wl{TrN Q wy{IN CCCTtM G {b.N OI COVN{[L Re: General Development Utilities, Inc. -- Requent for an lncreaae in water and Sever Rates, carrying Coat Recovery Charges, and Service Availability Charges for the Vero Beach Highlands and Vero Beach Shoran Division Dear Mr. Pinto: Pursuant to Section 17 of the franchise agreement dated May 5, 1960, as amended by section 2 of Ordinance 53-109 (the water and sewer franchise), General Development Utilities, Inc. (GD[J) hereby given notice to the Board of County commissioners of Indian River County that the Company deems its necessary to amend its charges for water and sewer services provided within its franchise area in Indian River County. The present rates are insufficient and the company is entitlad to increased rates that are just, reanonabla and compensatory, and will provide the Company with a fair and reasonable rate of return on its investment in property used and useful in the public service. The required application form and a supporting affidavit are attachad hereto and mads a part hereof as Appendix A. Information responnivs to the rats increase requirements is attached as Appendix a. Detailed financial, engineering and rate schadules are attachsd as Appendix C_ Also enclosed is a check for $575 in payment of the filing fee required by Resolution 91-31. INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:37 Nu.011 P.07 Hr. Terry pinto April 3o, 1993 Page 2 The currant and proposed water and Rawer rates are supportininthe Exhibit proposed I of Appendix C. Comprehensive data tha Company's ditConnection thnd e proposed increases in charges, Is included in Exhibits I thraough'ri of Appsndiand Xion The "carryingC. Ccoostnreoovaim lso ragchavqquaMtinq authority to implement a costs of water and newer tecilitiashhelddtorafut�irceascarrying to The CCRC is theovered from nsw customers at the time they, connect detail the system. Exhibit v of Appendix C contains more detail on the proposed CCRC. Finally, the company Reeks to modify its service Availability/Hain Extension Charges to mora accurately refnow lect current costs. These charges will be incurred only of AppendixoCers am contains®thoonnect to the system. Exhibit Vi together with su Present and proposed chargee Pporting detail. ' GDQ hereby requests monthly rates and ohat the proposed revisions to the thter charges be noticed for public lat at l er the earliest opportunity, but in any avant no than 90 days frOM the Bata of this notice, as required by the water and sewer franchise. As you know, "a County has expressed an interest purchasing from GDU the Vero Beach in Highlands and Vero Beach Shores Division. GDU is concerned about the conflict of interest that would occur if the Board of County Commissioners were to consider the rate request at the time it is considering the aoqulsition of the system. same To mitigate this conflic� ufc interest, CDU requests that the County obtain the services of an indapandant hearing officer from the state of ivision of AdministHearings to conduct the public haarings on the rate rative Florida,a request and to anter a recommended order, basad on the for cons tion and final action by the or of county Commissioners. The use of such a hearing statutes. officer is expressly permitted by section 120.65(9), Florida r -g Q INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:37 Nu.011 P.08 Hr. Terry April 30, Page 3 Pinto 1993 To facilitate the County malting arrangements for the use of an independent hearing officer, GDU is enclosing a proposed form of "Hearing officer Agraement.e This is modeled after an agreement used by Seminole County to obtain an independent hearing officer in connection with a public evidentiary hearing conduoted pursuant to Chapter 190, Florida Statutes. Copies of correspondence concerning this application should be sent to the undersigned attorneys for GDU, and to: Charles E. Fancher, Jr. president General Development Utilities, Inc 2601 South Bayshore Drive Miami, FL 33133-5461 Sincerely, Richer Cheryl Stuart Attorneys for GDU ROM/Mae Enclosures cc: Commission Chairperson Richard H. Bird Commission Vice Chairperson John W. Tippin ComMiesioner Fran B. Adams Commissioner Carolyn R. Eggert Commissioner Kenneth R. Hecht -Tames E. Chandler, County Administrator Charles Vitunac, County Attorney 1�1 /aa INDIAN RIVER COUNTY ID=407-770-5095 MAY 18'93 16:38 No.011 P.09 GENERAL DEVELOPHE"T UTILITIES, INC. VERO BEACH 11IGHLAHD3 AHD VERo SHORES TEST YZAR EHORD DRCEHBRR 31, 1991 EXHIBIT III RATE BABE Rate base represents the utility•o investment in -utility property, plant and equipment. These investments are financed by common equity, debt and cost free financing. The utility In entitled to rates which recover its expanaee and provide a fair return on its investments in property used and useful in the public service. As shown on Schedules III-lw and III -19, the first major iter in the rate base calculatlon to utility plant in service, net of accumulated depreciation. After this amount In eatobliahod, an analysis is performed to determine what portion should be classified as "non -used and useful" and therefore, excluded from rate bass for ratemaking Purposes. Other deductions from rate bane include contributions in aid of construction, (CIAO) 1008 Accumulated amortization of CIRC and advances for construction. CIAC represent those dollave paid by customers at the time they Initially connect to the system. These connection charges help defray the cost of connecting to the system. Tho company amortizes these contributions, at the same depreciation rate as the asset= relating to the contributions. sewer advances for construction were provided by Lucas Square_ Another investment, Included in rate base is "Deferred Tax Debits". Deferred tax debits are income taxes paid on CIRC and Advances from Escrow. Por tax purposes, these Items are considered income, and per books they are capital items. For ratecase purposes, those deferred taxes are a reduction to CIAC and Advances. The final component of rate base in A working capital allowance. This is the amount of capital required to bridge the gap between the time that collections for eerviean are received, and the time that paymonte for expenses ere required. We have calculated working capital using the formula approach, which cakes 1/8 of the utility's annual operation and maintenance expense an the working capital requirement. This method producas a reasonable estimate of the utility cash requiremonte and eliminates the need for expensive studies to determine working capital using other methods, such as lead lag studies. The formula approach recogniaen that thane In a 6-9 week leg from the time that water and sewer nervlce is provided and the time that the revenu08 for servlces are collected. In the meantime, the utility needs to have enough cash working capital to pay it■ electric bill, maintain the system, pay salaries, etc. Column 3 of Schedules III-lw and III -18 details the utility adjustments to rate bene for the ratiroment of a storage tank, the transfer of filters to another utility, and INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:38 No.011 P.10 CwIP transfers of property in service prior to December 1991. Also reflected is an adjustment to remove that portion of plant and related accumulatod depreciation which is determined to be held for future customers. The portion of the plant In service that is considered held for future use In determined by an englneering study which In Included In Exhibit IV. Deferred taxes are also adjusted to remove deferred taxes associated with Advances From Escrow.. INDIAN RIVER COUNTY ID:AO7-770-5095_ MAY 18'93 16:39 No.011 P.11 GENERAL DEVELOPMENT UTILITIES, INC. VERO PRACII NIONLANDS t VERO DITOREa YEAR ENDED DECEMBER 31, 1991 EXHIBIT IV _. USED AND USEFUL ANALYSIS the The used and useful analysis Por -tion amount tl is performed to determine lncludmdin - tsrate basetandhe uupontyhichstntshe uthiltyare to be OPPOr*tunitan reasonablyyto earn neces aryatoQturnishTheme assets are considered as OdAservice to Present utility customers, and to dost tthe nticipatede customer demands in the immediate future. The analysis distribution myni ors three separate components, i.e., water atco 11ct system, wastewater treatment plant and -wastewater collection system. HETNODD ?Qv The procedure followed in the "Rod and useful calculations considered. a) Including a physical iatthe plant and system components 9 pnspection. b) A study made of the service area, number of customers connected, types of customers, and the moot historical growth of the utility. recent c) Review of the planta operational data. d) Evaluation of components. the capacity of the existing plant and its Tho cost of each utilit" nystel. 1'•ir. December 31, 1991 was tnc.n _edyueted to rap th^ et�mt year endwd retirements and plant held for future use 1 ct an plant allowance for margin reaarva. . including an SM21A Y .QE BEBVLTS wa a Trenamt..slon Aad r pist__ ibA,�y fta The following concepts were "sad ih the used i useful determination: a) The used and useful analysis of the transmission and ATTACFNr.vT r //�. INDIRN RIVER COUNTY ID:407-770-5095 MRY 18'93 16:39 No.011 P.12 lots rconnected atoathessystem andathe ntotel riots fronting e lino_ This analysis also includes an allowance for Into located within Soo ft. of a fire hydrant. See schedule ZV-lw_ b) An allowance for margin reserve which constitutes that capacity required to be available to tie now connections on a short term basis was mads. See Schedule 2V -2w. When rounded, transmission and distribution mains non - be i useful calculations indicate that these mains should be considered loo! used 6-userul. Was teva a TXRAtMp * �t Wastewater treatment dplant OR to meet average maximum e Pac-aa! ity should be sufficient Percentage has been calculated nyfl ows. The used and useful daily flow Or the uas the raaerve ratio of the average m month with aand the capacity of the plant_n allowance for margin The 1991, Pluseaamarginlreserveflow or the allocationmamounted,to.�gq,40011 GPD which represents 46.4! Ot the plant capacity of 850,000 GPD. Tho percolation ponds capacity as established i D•E.R. Pern the Permit amount" to 450,000 GPD. Since flows occasionally axcaad this capacity, we havo considered thorn to be loot used i useful. Sas Schedule" XV -19 and ZV-29. was ewate�r eo�.�u �v"tem This calculation is based upon density V11_ The collection system in all other areas arenconsidered • 10O% used 6 useful because or high density_ a) Percentage used 6 useful for gravity mains was boned on a density analysis of lot" connected in VH -4, a margin reserve and the total lots with sewer service available. The density analysis resulted in a used and useful allocation of Si.a6*; therefore, 48.74* of the collection system in VH -4 was considered held for future use. b) This percentage was applied to the total cost installing the system in V11-4 to arrive at an adjustmont or. for sewer Rate Base. See Sohadulae Zv-3S and XV -4S. INDIAN RIVER COUNTY ID:407-770-5095 MAY 18,93 16:40 Nu.011 P.13 GENERAL DEVELOPNEHT UTILITIES, INC. VERO BEACH HIGHLANDS AND VCHO SHORES TEST YEAR ENDED DECENHER 31, 1991 EXHIBIT V CARRYING COST RECOVERY CHARGE The Carrying Cost Recovery Charge (CCRC) Is.a•.,one,tloe charge designed to provide the utility with a. returnlo¢,Plant which is prudently constructed to provide adequate'service,.to customers on a -continuous basis, but exceeds the needs -of current customers. This plant has been removed from the rate base used to not rates for current customers. CCRC 441. charged to future eustoaers;,as,.•bhej: oonndL'E-'re; the,, tygle. In planning for growth, water and newer utilities must design the size of lines, treatment facilities and walls such that customers receive service at a prudent cost. To help insure adequate service to customers on a continuous basis, the utility needs to allow a growth factor, which is usually 19 months, to meet the needs of future customers. This growth factor is added to the plant Actually used by the cuetcmars to determine the investment in rete base for ratemaking proceedings. In many cases, the most economically sized plant to serve future customers will exceed this growth allowance. When this happens, the utility is not allowed to earn a rate of return on the investment in excess plant. To help maintain Adequate service a carrying cost charge is required. The proposed charge requested;by.,Goneral.Develppmsnt Utilities, Inc. in this 6rcceedipg,ls;,desl4ned",e0 $tiecdv invewtments aeaociated with wastewater trdatmest facllitiaa andr collection mains which have been allocated to future use customers. The allocation of investment to future wastewater customers le reflected on Schedule III -1S. The carrying costs to be recovered as CCRC in based on a full cost approach providing a return on f��rnr.� plant and unfunded expenses such a" tiepraciation. The unfunded depreciation expense not charged to current customers In the development of required revenues is reflected on Schedule II -1S. The cost 18 calculated for one aquivalant residential connection (ERC) for a 1 year period until the time the utility reaches its designed capacity. The proposed charge is established on ;,monthly bawls for a pperlod of five years. If, at the end of ttve years, the plant is not at full. capacity, the company will voluntarily pisco a cap on the fee until such time as the facilities are at lull capacity. ATTACID4ENr D /O11-� INDIRN RIVER COUNTY ID=407-770-5095 MAY 18'93 16:41 Nu.011 P.14 The Charge in to be Collected from customers at the time that they initially connect to the system and pay cIAC lees. The requested CCRc foe for !ha weeteveter treatment plant In detailed on Schodule V-18, the requested CCRC fee relating to the collection facilltlee is detailed on Schedule V -1S. ouucl;�•r l b INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16=41 Nu.011 P.15 GENERAL DEVELOPMENT t1TILIT1Esj INC. VERO REACH HIGHLANDS AND VERO SHORES YEAR ENDED DECEMBER 31, 1991 ExHIB.IT VI SERVICE AVAILABILITY CHARGES Service Availability chargee are a one time charge paid by customers at the time they Initially connect to the System. This charge helps to dsfrey the cost of connecting now customers to the system and contributes to a lower monthly rate by reducing rate bane. General Development Utilities, Inc., In proposing a change in service -- availability chargee to mora accurately reflect current conte o[ construction. The utility Is requesting modifications to the plant capacity charge, main extension fee and service and meter installation chargee. The present and proposed rates are detailed onsch sewer. edules V1 -1M for water and VI-ls for The main extension and sewer lateral fee wen deelgq"d to recover 570 of the cost of mains and hydrants fefr`wdtsr end 750 of the Maine and Servleee !or Sewer. The fee will ba charged on the basin of per foot meenured along the front of the property to be served. The calculation of this charge in detailed on Schedule VI -2H for water and VI -29 for newer. The charge for water service and meter installation is designed to recover 1000 of the cost of the meter end service installation. The calculation of this charge is detailed on Schedule VI -3H. The wastewater plant capacity tee includes all other plant, property and equipment not Included In the mein extension and lateral foe. The rete is designed to recover 57% of the cost. The calculation le detailed on Schedule VI -]S for Bower. No change in the water plant capacity fee le requested. The utility may enter into an agreement with a developer requiring the de•relnoer r.., rte*- "-'Imum guaranteed connection charge (Reserve Capacity Chargge) If the developer wish"" to ensure that there wllI be sufficient plant cnpeclty available at various planned steges of development, the developer will be required to pay the fixed costs including depreciation, property tax, Insurance and interest costs on reserve capacity for the period of the reservation. This calculation for the wastewater utility Is detailed on Schedule VI -49. ATIACIDONT E -- INDIRN RIVER COUNTY ID:407-770-5095 MRY 18'93 16:42 Nu.011 P.16 1320 South Dixie Hl2hr.y Penrheu.e Corel D.Mc.. Florid. 33146-1%4 F.x (305)665-7456 May 6, 1993 RACHLIN & COHEN CewTIFIBD PUBLIC ACCOUNTANrr & COm#ULTANTS A Pu ...o(r P.r.r.sea A ..t badu 12 Brrow.Brd (30S) 67717 Mr. Torrance 0. Pinto Dirootor of Utility Bervioas Indian River County 1860 25th Street Ve,:e Beach, Florida 37960 700 Soud.m.r YMlyd A..en..c liuim too FL Florid. 3.316-1102 Fu (305) 764.763 MAY 7 d 1993 Dear Torrys we ora pleated to submit !hi■ proposal for consulv ting sarloas pertaining to the analytic of a wabz and eewor rata application tubrittod by "naval Dovmlop.Bant Utilities, Inm., Vero Basch Division. Aa you know, our fizz. Rachlin 6 Cohan is well raepootsd throughout the state for its rany years of exparienoe in municipal and private utility fields. our rizm has had previous experience in reviewing finona"Wragulatory data prepared by the utility, historical data of the utility and this will provide us with the advantsgo of familiarity. Additionally, the fire knaves the msntgament end staff of the utility and understands the typo Of filings prepared by the utility. The primary ebjactive of the type of Analytls required for this eemprehantiw0 including A a.raminatiOQ of the most at serviae and Cheat would be evaluation, ultimately Providingroe thorough roto the Indian River County Board oCounty to the Btarf to M presented to tY Cemmissianers. The rata evaluation will include . A. Initial matting with the Neste to understand their goals and objectives for this project. b. Development of A -w&nt list' of dgausantt, records, source data, engineering report, ate. neoocoary to perform naering a oemprohantive rata evaluation. iieering with utility ropr000ntativo■ if naetatary. a` Analyoia of the rets tpplicatien, which will include vorfioation of source data and the traoing of historical numbers to the Annual Report on file with the County, and ra L~ of aseusptions mood far projections inaludad In the application. d. Compilation of lnrormation and dawlopmant of drart raport mto 6-s presented to the Staff for oeaants before oamplotien. a. Attend hearings or "ekaheps Conducted by Indian River Count a of County Coeiaaioners as requested. y and the Beard A� 1..e .d.I. Mllae M Pd.mipl tide d.m..br.w. M w.Id. /D V MrnMr of rhe Amerinn InNaa W Can:fied P.AI6 Ae...ns..s d..ib. lbr BBC Pr.anee 8s ' q ey dr Pri..a Membc. nrrAc Pledd. In,d.um of C<M.d P.Mic Aeee..nrnn �...Pr^ie Pranks Be.,i INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16=42 Nu.011 P.17 , Mr. Terrance g. Pinto May 6, 1993 Page 2 r. Issue final report or findings and recommended rats.. A key to a ruccesslul rate applieatieo enalysie is a knwl.dgeable ceneulting team with broad channels or eos...nloatien in order to me,lsd96Latins the involveenq interest• and cemitment or the county. The mope e! our iovelvsme a is outlined in t1L enclosed budq.e delineated by a. CLO tasks end draws upon �tenelve esperlenoe of the key statf of cur [ism. The feu "signed to your project will possess the highest level of protersLocalieue. A eaitrLz will bm used few task and timeframe assignment. Our proyosed budget is attached for your review and oensideraticn. The comprehensive fee will not exceed 815,590 for this en9agsment. 3lesumes of cur hey staff are enclosed for your rorerenoe. Thank you for consideration of this proposal. ahould you hese any question■ or require additional inrorsiailon, please do oet hesitate to call ma. SIn Lisa A. Layne, er . • .7►. Cos Cindy White, PranchLse coerdinstor /oq IHDIRN RIVER COUNTY ID:407-770-5095 MRY 18'93 16:43 No.011 P.18 Indian River County - Utility service■ proposal for Rate APPIL"tien Rvaluatioo =U1993 Nay S. 1993..•��--�-�-„� Staff Teak Laval EMMAM"d of hour* Hour1Y TOtal a. Initial ww+•tinq with *teff for inrtruotion■ Direotor .Hsaalced 7 w/trawl Rate $200 QQ1L_ 8 1,400 b- Rwiew of rata applioation C 1992 Annual Report for preparation of ^pant List' Beniar Director 2 1 $ eD 5200 S ISO S 200 1. Meet with Utility Reppresentatives res ^Ment Lirt� (epi conal) Director 1 5200 S 200 C. Analy.i• of Rata Application 1- 2. 3. Review of historical data Review of cost allocation■ between water c sewer OFN Evaluntlon senior Senior 40 4 S BO $ so S l,2Do S ]20 ♦. S. d- I. a. Ado "way tr b- Projeced futue co.ta C. Overhead allocations Rwlew of projeotea data, Lf naceaaary RavL— of billing analyai. *ar Prpatt ion of rapor Quality control Na*t with ataff to discus. report (includes travel) d•nioz Senior Santo, Senior M Manager Banter Naaagar bo or Direotnr S 2 10 2 2 20 2 = S $ BO $200 — 8 SO S SO S10o S BD $100 $200i $200 $200 S 400 6 400 S BOO S 160 S 200 S 11600 200 900 400 S 1,600 a. f. Att*nd hearing• or workshops, if n*ad•d Prepare r•vi.Lonw and issue final rept or Director Senior S 10 $200 6 so S 1, 60p s Boo Administrative — 5 5SO Out-Of-pook•t s --AQQ Total INDIRN RIVER COUNTY Position Education Professional history ID:407-770-5095 hIRY 18'93 16=43 Nu.011 P.19 LISA A. LAYNE Director Director, Consulting and Special Services Department B.S., Accounting, University, of Florida; Masters of Taxation, Florida International University Rechlln & Cohen, Joined firm July, 1979 Dale Blocher, CPA. College Intern Experience Mrs. Layne has had experience In auditing various Industries, Including governments, water, wastewater and gas utilities and cable television operations; cost of service and rate development for municipal and investor-owned systems. Professional end civic affiliation Member, Florida Institute of Certified Public Accountants Member, American Institute of Certified Public Accountants Committee Member, FICPA State and Local Government Account- Ing Conference (1992-93, 1989-90, 1987-88, 198485) President and Board Member, Children's Resource Fund, Inc. Who's Who of American Women While ^,� _ of SL;0L;6136,L]; i ,—oa Businesswoman Who.'a Who in Accounting INDIAN RIVER COUNTY 1D:4O7-770-5095 MAY 18'93 16:43 No.O11 P.2O Position Education Profesalonel history CAFtA L PAsQUALP Manager Manager, Consulting and Special Services Department B.A., Sociology, University of Miami M.B.A_, Business Management, University of Miami Rachlin & Cohen, 1990 to Present General Development Utilities, A09uletory Analyst, 1983-1989 Rachlin & Cohen, 1980-1981 Dade County Citizen Services, 1979-1980 Experience Mrs. Pasquale has had experience In cost of service and rate development for municipal and investor-owned systems, including county and city governments, water, wastewater and gas utilities. Additionally, she participates in engagements relating to operations auditing and development of business plans for Firm clients. Professional and civic - affiliation Member, Davie -Cooper City Chamber of Commerce, Business Advisory Committee INDIAN RIVER COUNTY Position Education ID:407-770-5095 MAY 18'93 16:44 No.011 P.21 TIMOTHY P. MCCLOSKEY Senior Senior, Consulting and Special Services Department B.S., Accounting, Long Island LIMaralty, C.W. Post Campus, Greenvale. New York Professional history Rachlin & Cohen, December, 1992 to Present Long Island Lighting Company, 1991_1992 Goldstein, Golub, Kessler and Company, P.C., 1988-1991 Experience Mr. McCloskey has had experience In auditing various Industries, Including not for profit, manufacturing and real estate coopera- tives; accounting and tax experience including preparing rate case achedules and public service commission pages for year-end annual report for electric and gas utilities. Professional and civic affiliation Broward County League of Cities ��3 INDIAN RIVER COUNTY ID=407-770-5095 MAY 18'93 16:44 No.011 P.22 u M Sum Ory. 4f Related MWerOyme - Raehlln & Cohen Qtr firm Provides consulting aemom to tate-xdu}abd bndnstrfea, tocludins water sod vrastatvayr a3 0, tt UUnLi and propme See eompedas, eleeteie utilities red cable television aystems. We rertosce invcattr and oip.tly owaw systema rmd regulatory ageedes in the ata appue&d= P mumft, assist with flnanaWp2atWtg artd oWduota evlda taeje of utudia onbehalf of=w aUcnts. lease studies ata t "Ad far such yurpeoea ae ate ytoaeedlgp, acqulddons, SM rad same tsx tsttm Snntcles. and eminan domain proosedlnPs. a e6� fs ood equentiy to w"duste df '"d for revenue aglustmenta In preparation for eoumep proceeding.rate Our stat PMOPft +s exeiNts and ftxdnwny for pre�esdan. We assist legal fur zlny the testimony of Others, VwWwrlua rebuttal testimony, developing strategies S witnesses and tevimong propowd orders, lZaehlle & Ooben have provided expert testimony at raea ta hriepts M various status prefeaaioaeis Now yerae], Delaware and. How Itfotioo. Including p'io*idl, New Yorle, Oar financial plarmtoy' ssrviod cover such topion as rate policy and sats &Uvctute. anlino credit of d deWoquity oti1eetivea. Ws auist In dere mining the coat of ptovksrrg serviea. Anes of soda d eapdeal rad rata of tatuen, and perform a number of va u trim studies. Valuation stodlee myy involve inoome prgcadons, aarvice area growth Projmtions, or etutomet-nadz analyses We also Paptictpaua in Negotiations when our elteaU buy of sell UdKty rystemt y Mnnklnal Anance llwhlie A. (aehen's mudded IInancoprafesdeaab wt)&oharly wish IoealgNvaNmeate, bodies and spead ttudng au"wrides wMeh ar spteparing to luno taiwaempt wcufltW U wv awjnc prqeenbaaeots WheerthshUtdsareusedtobuildnewwMarwWwasWWAtOrVatsM.impmvadrafnnppe or oe lite theavJraemeet, ear Arm spWsts theme At"01" and nmmte;palitla in identifying the epgrvpriata sourer of cash flew to wTPoat emir bonowlag requlrcmenta. Our aaslgamwrm an diverse. Lt one emtsnoe, we pretbrmed a variety Of services ter a South Florida municipality� PmaLssed a reties of ntiltty systems. variety dimcwr of our firm chaired the committee atslSW to evaluate Inveshumt hanirirm candidate for a Proposed bond issue. also advise numerous mi ate fmaoos utility im9p ovementa and ri�uoRM Outstanding debt. We Bar them. `oat ep=Wc utilhy systrm putduea rad oontltrct rate analysis zo 'd -a. OP• I I "1 v I _n - I— INDIAN RIVER COUNTY ID:407-770-5095 MAY 18'93 16:45 No.011 P.23 BtbNo h o Rocent Raohiin & Cohan Pry 'ects Warea civ: ktm serer.: P.. sou rbuart Ymm P1orWfi 34935mw(477) 2 1444tw 2 (�t►7) 22l-iKl Waear old waetawn w Rale and a Pen ftidy 2000omnmmood m►l�ooa Raftno". = Mr. s m Plot Yw�d• u�t 332 Aetor St Aeftj megruokla wf Wmnawvtw Rao@ ftmly Evalu.tim and U W of awwwatet ase Oser Pktrwe»i.•aw.sa.s OM 92f-3301 .te Ordbum.. Wim Comae ado, atu.. 106 W�eR Daob Ceram RGfttmee: D& Robert *%d y. Vild Plarma 330" cuyhumm ) i121 C' Cu=wmkm � ammo. am. 201 1 r6ii 34JL 1M Avow= +d sa.rb. �ortdaRaftmm( Heb- P&w& be6nd 1mc, Plwift 3316E-3194 Wmuw mad aewR Rare sumnN >ula+t ad 1®! Ravfew 29 ooh• VubLow or Gott. 1f7mtda Zl Qmo&y Road R�� Vl Mr, John 9loebn. qW vfrOutt. l wilt 33436 (Vno7 A! Aaauet Radew of Rm Adequacy Rohe DLmwudW A=Blyak 9br mel0e =a Oualde C.! y Lbuft 8L Lad& 2300 Vbtk a AveeKe i am SPRW Aut>m14 Re4eeo xL �mee� Prima<me. 82 Aftwim �. Aaosom as 00 AutLoH4'a qat[ fa amlyz+Y rm (407) 4611-1773 appllralom eewnmw, etatL �ppI� Itaaeg P1eAfa Rafaenm ldr_ Riebed peel. . 1t`wl � nwJda 331" OWN 673-7620 wort want and waeuwater Rab aloft at w � RMW Ravms plocalumm coftocevaL�9oo Runt