04 - Laserfiche WebLink

• • Task 2.2 Tests of Transactions R3 will conduct a review of PGS' rate application to verify that financial data, including costs, headcounts, capital items, and operational data are consistent with the rate setting policies and procedures contained in Section 18 of the Refuse Collection Agreement and in Exhibits A, B, and C. The review procedure may include, but not be limited to the following: • R3 will develop a rate model to assist in the evaluation of the rate application; • R3 will review the reconciliation of the financial information included in the rate application to PGS' audited financial statements as submitted in the rate application; • R3 will review the historical, actual and forecasted revenues generated from the rates and calculate current revenues; • R3 will review variances from year to year and obtain explanations for significant variances; • R3 will review officers' salaries for PGS and all affiliates and subsidiaries; • R3 will review the calculation of PGS compensation; • R3 will review projections of expenses for reasonableness; • To the extent additional information is needed to perform the above procedures, R3 will provide a written request to PGS. Task 2.3 Rate Calculation Based on the results of the procedures performed as part of the above-mentioned tasks, R3 will calculate the return on equity in accordance with the requirements of the Agreement. Deliverables Task 2 includes the following deliverables: • Initial letter to the City regarding the completeness of the rate application and data submittal from PGS; • Thorough review of PGS financial data, operating costs, revenues, staffing levels, officer salaries, capital items, etc., and • Preparation and submittal to the City of a rate model in electronic format that incorporates the relevant financial and operational data received during the review. Task 3: Rate Negotiations with PGS Upon completion of the review of the data and information received by PGS, R3 will work with City staff to initiate rate discussions with PGS. This will include the following subtasks: