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Exhibit A -Scope of Work of the study. Task 2.1-Additional Rate Alternatives Analysis Task Objective: From the rate structure alternatives selected in Phase One, develop technical analyses of the rate structures selected. Utilize the cost information developed as a part of the previous tasks and develop local sewer rate design options for possible adoption by the City. In designing the local rate options for the City, the cost of service information and average unit cost information developed in Phase One will be utilized as a starting point. Based upon the policy direction provided in Task 1.7, the final rate alternatives will be developed and evaluated. For each rate design developed, a bill comparison and graph will be provided that shows a comparison between the present bill and the proposed bill at various levels of usage. Bill comparisons are useful in assessing the potential impacts to a wide variety of customers. A comparison of neighboring sewer utilities will also be provided for the proposed rate designs. Expected City Staff Support for Task 2.1: For this task, the City will be expected to: ^ Review rate design alternatives for appropriateness Deliverables as a Result of Task 2.1 -Additional Rate Alternatives Analysis. From the work accomplished above, the deliverables for this task will be as follows: ^ Development and evaluation of various rate design alternatives. ^ Bill comparisons and graphs for the rate design alternatives developed. ^ Comparisons of the proposed rates to neighboring utility rates. Task 2.2-Implementation Strategies Task Objective: Based upon the City's preferred rate alternatives, if necessary, develop implementation strategies to assure a smooth transition and high acceptance from the City's customers. Implementation and rate transition are an important component of a rate study that is often over- looked or misjudged. Implementation strategies generally focus on two different areas. The first implementation strategy may address the need to simply increase rates significantly over existing levels based upon the results of the revenue requirements. Under this implementation strategy, the focus is typically on the size and timing of rate adjustments. The second type of implementation strategy is related more to the issue of rate structures and classes of service. Any change in a rate structure will have an impact upon customers, even if the rate design is revenue neutral. Given that, an implementation strategy for rate design may focus on how best to move from one structure to another and how to do that in a way that minimizes impacts from that change. While these two implementation strategies appear to separate decisions, in fact, they are often interrelated. As a part of this task, HDR will consider the final proposed rates and develop implementation strategies to aid in a smooth rate transition. FIDR will provide a final proposed recommended strategy and the reason for that recommended strategy. Expected Ciry Staff Support for Task 2.2: For this task, the City will be expected to: Comprehensive Loeal Sewer Rate Study A•71 ~~ City of Pleasanton