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Page 1 of 4 <br />Item #5 <br /> CITY COUNCIL AGENDA REPORT <br /> <br />September 3, 2024 <br />Public Works - Operations Division <br /> <br />TITLE: APPROVE PROFESSIONAL SERVICES AGREEMENT WITH WATER <br />RESOURCES ECONOMICS, LLC FOR A NOT-TO-EXCEED AMOUNT OF <br />$217,304 FOR WATER AND SEWER RATE AND CONNECTION FEE <br />CONSULTING SERVICES AND APPROVE BUDGET AMENDMENTS TO THE <br />WATER OPERATING FUND AND SEWER OPERATING FUND <br /> <br />SUMMARY <br />In November 2023, the City Council approved water and sewer rates effective from January 1, <br />2024, through December 31, 2025. To prepare for the subsequent water rate period, the City <br />issued a Request for Qualifications (RFQ #PWD 24.603) in June 2024 for consulting services <br />to conduct water and sewer rate and connection fee studies. This upcoming water and sewer <br />rate study will be aligned with the capital improvement needs to be identified in the Water <br />System Management Plan and the Sewer System Management Plan. Staff reviewed three <br />Statements of Qualifications (SOQs) received in response to the RFQ and identified Water <br />Resources Economics, LLC, as the most qualified firm to undertake the study. Staff <br />recommends the City Council authorize the City Manager to enter a professional services <br />contract with Water Resources Economics, LLC, in an amount not to exceed $217,304, <br />inclusive of a 15 percent contingency. <br /> <br />RECOMMENDATION <br />1. Approve a professional services agreement with Water Resources Economics, LLC for <br />a not-to-exceed amount of $217,304 for water and sewer rate and connection fee <br />consulting services. <br />2. Approve budget amendments by increasing professional services appropriation in the <br />Water Operating Fund (420) and Sewer Operating Fund (430) by $35,000 and $45,000, <br />respectively. <br /> <br /> <br />BACKGROUND <br />The City's water and sewer utility services are managed as enterprise funds, adhering to strict <br />fiscal management practices that require these funds to be fee-based. In accordance with <br />State law, the cost of delivered water is charged at the actual cost of service, ensuring that no <br />profit is made. Any surplus revenues at the end of the fiscal year are allocated to offset costs in <br />future years. <br /> <br />For sanitary sewer services, the fees, rates, and charges must cover all costs incurred by the <br />City, Dublin San Ramon Services District (DSRSD), and the City of Livermore. This includes <br />capital, operational, maintenance, administrative, and monitoring costs as outlined in <br />Pleasanton Municipal Code Chapter 15.20.30. <br /> <br />Page 28 of 46