HomeMy WebLinkAboutC-8587-1 - PSA for 2019 Water Rate Study1
tYJ AMENDMENT NO. FIVE TO
PROFESSIONAL SERVICES AGREEMENT
WITH RAFTELIS FINANCIAL CONSULTANTS, INC. FOR
V 2019 WATER RATE STUDY
THIS AMENDMENT NO. FIVE TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. Five") is made and entered into as of this 10th day of May, 2022
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and RAFTELIS FINANCIAL
CONSULTANTS, INC., a North Carolina corporation ("Consultant"), whose address is
227 West Trade Street, Suite 1400, Charlotte, North Carolina 28202, and is made with
reference to the following:
RECITALS
A. On March 12, 2019, City and Consultant entered into a Professional Services
Agreement ("Agreement") for Consultant to conduct the City's 2019 Water Rate
Study ("Project").
B. On February 3, 2020, City and Consultant entered into Amendment No. One to
the Agreement ("Amendment No. One") to extend the term of the Agreement and
to update the insurance requirements.
C. On February 1, 2021, City and Consultant entered into Amendment No. Two to
the Agreement ("Amendment No. Two") to extend the term of the Agreement and
to update the insurance requirements.
D. On August 20, 2021, City and Consultant entered into Amendment No. Three to
the Agreement ("Amendment No. Three") to extend the term of the Agreement
and to update the insurance requirements.
E. On October 18, 2021, City and Consultant entered into Amendment No. Four to
the Agreement ("Amendment No. Four") to reflect additional Services not
included in the Agreement, as amended, and to increase the total compensation.
F. The parties desire to enter into this Amendment No. Five to extend the term of
the Agreement to December 31, 2022.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on December 31, 2022, unless terminated earlier as set forth herein."
Raftelis Financial Consultants, Inc. Page 1
2. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
Raftelis Financial Consultants, Inc. Page 2
IN WITNESS WHEREOF, the parties have caused this Amendment No. Five to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: 4 /.?( /9 a
C�r
Air n C. Harp
City Attorney
ATTEST:
Date:
CITY OF NEWPORT BEACH,
a Californi nicipal corporation
Date: '?1?Zo 2Z
By:
(kM M11417-7- Gr Panager
ung
CONSULTANT: Raftelis Financial
Consultants, Inc, a North Carolina
corporation
Date: (' / /(o 127--
By: By.�
Leilani I. Bro"WA Peiffer
City Clerk Chief E
Date
0.�j�
U. Brandt
ecutive Officer
-I(9-12,
By:
J7 sica Jasso
Secretary
[END OF SIGNATURES]
Raftelis Financial Consultants, Inc. Page 3
00
AMENDMENT NO. FOUR TO
U PROFESSIONAL SERVICES AGREEMENT
WITH RAFTELIS FINANCIAL CONSULTANTS, INC FOR
2019 WATER RATE STUDY
THIS AMENDMENT NO. FOUR TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. Four") is made and entered into as of this 18th day of October, 2021
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and RAFTELIS FINANCIAL
CONSULTANTS, INC, a North Carolina corporation ("Consultant"), whose address is
227 West Trade Street, Suite 1400, Charlotte, North Carolina 28202, and is made with
reference to the following:
RECITALS
A. On March 12, 2019, City and Consultant entered into a Professional Services
Agreement ("Agreement") for Consultant to conduct the City's 2019 Water Rate
Study ("Project").
B. On February 3, 2020, City and Consultant entered into Amendment No. One to
the Agreement ("Amendment No. One") to extend the term of the Agreement and
to update the insurance requirements.
C. On February 1, 2021, City and Consultant entered into Amendment No. Two to
the Agreement ("Amendment No. Two") to extend the term of the Agreement and
to update the insurance requirements.
D. On August 20, 2021, City and Consultant entered into Amendment No. Three to
the Agreement ("Amendment No. Three") to extend the term of the Agreement
and to update the insurance requirements.
E. The parties desire to enter into this Amendment No. Four to reflect additional
Services not included in the Agreement, as amended, and to increase the total
compensation.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows -
1 .
ollows:
1. SERVICES TO BE PERFORMED
Exhibit A to the Agreement shall be supplemented to include the Scope of
Services, attached hereto as Exhibit A and incorporated herein by reference ("Services"
or "Work"). Exhibit A to the Agreement and Exhibit A to this Amendment No. One shall
collectively be known as "Exhibit A." The City may elect to delete certain Services
within the Scope of Services at its sole discretion.
2. COMPENSATION TO CONSULTANT
Exhibit B to the Agreement shall be supplemented to include the Schedule of
Billing Rates, attached hereto as Exhibit B and incorporated herein by reference
("Services" or "Work"). Exhibit B to the Agreement and Exhibit B to Amendment No.
One shall collectively be known as "Exhibit B."
Section 4.1 of the Agreement is amended in its entirety and replaced with the
following:
"City shall pay Consultant for the Services on a time and expense not -to -exceed
basis in accordance with the provisions of this Section and the Schedule of Billing Rates
attached hereto as Exhibit B and incorporated herein by reference. City shall pay to
Consultant and Consultant accepts as full payment for all Work performed in
accordance with this Agreement including all reimbursable items the sum of One
Hundred Sixty Nine Thousand Four Hundred Twenty One Dollars and 00/100
($169,421.00). Additionally, the City has allocated a contingency amount of Thirteen
Thousand Nine Hundred Seventy Nine Dollars and 00/100 ($13,979.00) for
unexpected costs, for a total not to exceed amount of One Hundred Eighty Three
Thousand Four Hundred Dollars and 00/100 ($183,400.00). No portion of the
contingency shall be expended without prior written approval of City's Project
Administrator."
The total amended compensation reflects Consultant's additional compensation
for additional Services to be performed in accordance with this Amendment No. Four,
including all reimbursable items and subconsultant fees, in an amount not to exceed
Thirty Thousand Dollars and 00/100 ($30,000.00).
3. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
Raftelis Financial Consultants, Inc Page 2
IN WITNESS WHEREOF, the parties have caused this Amendment No. Four to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: IC,/ (
By: 0 �rl
n C. Harp -
C'44 Attorney
ATTEST: . � �)j Date: I
t (
By:4A", A��_
L
I. Brown
City Clerk
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: ►t%1/�yz
By:
Gra96,*. Leung
Cit anager
CONSULTANT: Raftelis Financial
Consultants, Inc, a North Carolina
Date: j b, V 2 11
-
By:
P(1 (3
eiffer . Brandt
Chief Executive Officer fficer
Date: `Q 7 2 1
By:
Matthew . Jac n
Secretary
[END OF SIGNATURES]
Attachments: Exhibit A — Scope of Services
Exhibit B — Schedule of Billing Rates
Raftelis Financial Consultants, Inc Page 3
EXHIBIT A
SCOPE OF SERVICES
Raftelis Financial Consultants, Inc Page A-1
September 24, 2021
Mr. Mark Vukojevic
Utilities Director
City of Newport Beach
100 Civic Center Drive
Newport Beach, CA, 92660
445 S Figueroa Street _ 213 262 9300 www.raftelis.com
Suite 1925 213 262 9303
Los Angeles, CA 90071
Subject: Proposal for Water Conservation Ordinance and Penalty Update
Dear Mr. Vukojevic:
Raftelis in conjunction with Water Resources Economics, is pleased to submit this scope of services to
assist the City of Newport Beach (City) in conducting an update on the Water Conservation Ordinance
(WCO), using the 2020 Urban Water Management Plan (UWMP). The adoption and enforcement of the
water conservation and supply shortage program is necessary to manage the City's water supply in the
short and long term and to avoid or minimize the effects of a supply shortage within the City's service
area. Such a program is essential to ensure a reliable and sustainable minimum water supply for public
health, safety, and welfare. The updated WCO will identify the necessary water demand reduction at each
declared Emergency Water Supply Shortage declaration level. Raftelis will calculate and present multiple
scenarios of excessive water use penalties implemented during a water shortage emergency utilizing
customer water budgets as the base. The following details our scope of services.
Scope of Service
This scope assists the City to update its Water Conservation Ordinance (WCO) and to develop penalties
that enforce water shortage measures and are consistent with the 2020 Urban Water Management Plan
(UWMP).
Raftelis will conduct the Study as follows:
1. Raftelis will review the updated UWMP to determine the City's emergency supply reduction
required at each drought level.
2. Raftelis will develop an account -specific water budget allocation module to determine which
customers should cut back and by how much to meet the goals associated with Task 1.
3. Based on Task 1 and Task 2, Raftelis will determine the customers, both in order and
magnitude, affected by the implemented penalties.
4. Raftelis will create and present up to three WCO and Penalty scenarios to different
stakeholders.
5. Based on the input of the City's stakeholders, Raftelis will document and create an
administrative record for the WCO and the associated penalties in a Memorandum.
Proposal for Water Conservation Ordinance Review and Penalty Rate
City of Newport Beach
Task 1—Project Initiation and Management
-��:I< �.,1 PrOlert Irit ,fit n^ 1^� f`�t� ri�l�ortinr
A productive webinar kick-off meeting is the most effective way to begin the Study. The goals for the kick-
off meeting include:
• Establishing goals and objectives
• Finalizing the work plan and schedule
• Discussing the data request and any additional data requirements
Before the kick-off meeting, we will prepare a detailed data request that identifies the information
needed. If possible, Raftelis will review the initial data before the kick-off meeting and discuss any
additional data requirements to complete an updated model.
Meetings: One (1) webinar kick-off meeting with City staff
Deliverables: Kick-off meeting agenda materials, meeting minutes, data request list
I ask 2— Emergency Vvater Supply Shortage Anaiys s
Raftelis will review the 2020 UWMP determined water supply shortage stages to determine the necessary
supply reductions required during an emergency. The City has four levels of mandatory conservation
requirements applicable to the conditions created by the diminished water supply shortage.
Meetings: One (1) webinar kick-off meeting with City staff
Deliverables: None.
Task 3— Budget Allocatinn Mode'
Raftelis will develop a Water Budget Allocation Model that takes into account indoor and outdoor needs.
The Model will use data developed in conjunction with the City and will project how many customers are
outside their water budget allocation and in which month this occurs. The Water Budget Allocation Model
will have the ability to change the default values for all water allocation factors, including indoor gallons
per capita per day and the default value for residential households, evapotranspiration (ET),
evapotranspiration area factor (ETAF), and any potential cap on landscape area. The Model will have the
ability to change the ETAF for outdoor water use by different customer classes (residential and dedicated
landscape). The Model will include a Drought Factor field for potential City use to manage water during
times of restrictions.
Raftelis will utilize this Model to develop emergency stages consistent with the City's Water Conservation
regulations. Raftelis assumes that the City has acquired the appropriate landscape area and has merged
this database with the account level billing database. If needed, Raftelis can merge these databases.
Meetings: Two (2) webinars with City Staff
Deliverables: Water Budget Allocation Model in Microsoft Excel
12
Proposal for Water Conservation Ordinance Review and Penalty Rate
C/ty of Newport Beach
'-�'< ' --'. ater Co --servation Ord Bance Workshop,
Following the Budget Allocation model's completion, Raftelis will hold four in person meetings with City
Committees' and City Council to develop different water shortage scenarios. The first two of these
meetings will be conducted with the Finance Committee and Water Quality Committee. The next two
meetings will be conducted with City Council. Based on inputs from these workshops, Raftelis will finalize
the Water Conservation Ordinance and associated penalty rates.
Meetings: Four (4) meetings - One (1) Finance Committee Meeting; One (1) Water Quality Committee
Meeting; Two (2) City Council Meetings
Deliverables: PowerPoint presentations for the workshop
Task 5 — Water Conservation Ordinance Update
A draft Water Conservation Ordinance and Penalty Study Memorandum (Memo) will describe the process
for developing the proposed penalties. Comments from City Staff will be incorporated into the Final
Memorandum. The Memorandum's ability to explain the penalties development process clearly and
comprehensively will promote financial transparency, heighten legal defensibility, and uphold the City's
strong reputation with the public.
Meetings: One (1) webinar with City Staff
Deliverables: Draft Memorandum, Final Memorandum in Microsoft Word and PDF
13
EXHIBIT B
SCHEDULE OF BILLING RATES
Raftelis Financial Consultants, Inc Page B-1
Proposal for Water Conservation Ordinance Review and Penalty Rate
City of Newport Beach
Cost Proposal
The Raftelis project team will consist primarily of Sanjay Gaur of Water Resources Economics, Jonathan
Jordan (Consultant), and Los Angeles based consultant staff. Other Raftelis staff may assist in completing
requested tasks if necessary. The following tables show Raftelis' fee table. Raftelis will bill the City based
on time and material.
14
Hours
Total Fees
Web Numberof
&
Tasks
Meetings Meetings
SG*
TR
Sc
Admin Total
Expenses
1. Project Initiation and
Management
1
5
1
4
4 14
$3,025
2. Emergency Water Supply
Shortage Analysis
1
4
1
4
9
$2,345
3. Budget Allocation Model
2
10
12
40
62
$14,420
4. Water Conservation
Ordinance Workshops
4
40
1
20
61
$19,490
5. Water Conservation
Ordinance Report
1
4
4
20
28
$6,320
Total Estimated Meetings / Hours
5 4
63
19
88
4 174
Hourly Billing Rate
$310
$275
$185
$80
Total Professional Fees
$19,530
$5,225
$16,280
$320 $41,355
SG* - Sanjay Gaur (with Water Resources
Economics)
Total Fees
$41,355
TR - Steve Gagnon
SC - Staff Consultants
Total Expenses
$4,245
Admin - Administrative Staff
Total Fees & Expenses
14
r
AMENDMENT NO. THREE TO
00 PROFESSIONAL SERVICES AGREEMENT
v WITH RAFTELIS FINANCIAL CONSULTANTS, INC. FOR
2019 WATER RATE STUDY
THIS AMENDMENT NO. THREE TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. Three") is made and entered into as of this 20th day of August, 2021
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and RAFTELIS FINANCIAL
CONSULTANTS, INC., a North Carolina corporation ("Consultant"), whose address is
227 West Trade Street, Suite 1400, Charlotte, North Carolina 28202, and is made with
reference to the following:
RECITALS
A. On March 12, 2019, City and Consultant entered into a Professional Services
Agreement ("Agreement") for Consultant to conduct the City's 2019 Water Rate
Study ("Project").
B. On February 3, 2020, City and Consultant entered into Amendment No. One to the
Agreement ("Amendment No. One") to extend the term of the Agreement, and to
update the insurance requirements.
C. On February 1, 2021, City and Consultant entered into Amendment No. Two to the
Agreement ("Amendment No. Two") to extend the term of the Agreement, and to
update the insurance requirements.
D. The parties desire to enter into this Amendment No. Three to extend the term of
the Agreement to June 30, 2022 and to update the insurance requirements.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties
as follows:
1. TERM
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on June 30, 2022, unless terminated earlier as set forth herein."
2. INSURANCE REQUIREMENTS
Exhibit C (Insurance Requirements) of the Agreement shall be deleted in its
entirety and replaced with the Exhibit C (Insurance Requirements), attached hereto and
incorporated herein by reference. Any reference to Exhibit C in the Agreement, as
amended, shall hereafter refer to Exhibit C attached hereto.
3. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
Raftelis Financial Consultants, Inc Page 2
IN WITNESS WHEREOF, the parties have caused this Amendment No. Three to
be executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: 91/17112,0 Z j
By: 7� for
Aaron C. Harp Ui,arliiu
City Attorney
ATTEST: /`,
Date: R. p.
By:
City Clerk
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: SEP 13 2021
By:
Gra Leung
Ci anager
CONSULTANT: Raftelis Financial
Consultants, Inc., a North Carolina
corporation
Date:
By: 4.
Peiffe A. Brandt
Chief xecutive Officer
Date: I-
By: Wa,,A.414
Matthew R. ackson
Secretary
[END OF SIGNATURES]
Attachments: Exhibit C — Insurance Requirements
Raftelis Financial Consultants, Inc Page 3
EXHIBIT C
INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1. Provision of Insurance. Without limiting Consultant's indemnification of City, and
prior to commencement of Work, Consultant shall obtain, provide and maintain at
its own expense during the term of this Agreement, policies of insurance of the
type and amounts described below and in a form satisfactory to City. Consultant
agrees to provide insurance in accordance with requirements set forth here. If
Consultant uses existing coverage to comply and that coverage does not meet
these requirements, Consultant agrees to amend, supplement or endorse the
existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Consultant shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury by
disease in accordance with the laws of the State of California, Section 3700
of the Labor Code.
Consultant shall submit to City, along with the certificate of insurance, a
Waiver of Subrogation endorsement in favor of City, its City Council, boards
and commissions, officers, agents, volunteers and employees.
B. General Liability Insurance. Consultant shall maintain commercial general
liability insurance, and if necessary umbrella liability insurance, with
coverage at least as broad as provided by Insurance Services Office form
CG 00 01, in an amount not less than one million dollars ($1,000,000) per
occurrence, two million dollars ($2,000,000) general aggregate. The policy
shall cover liability arising from premises, operations, personal and
advertising injury, and liability assumed under an insured contract (including
the tort liability of another assumed in a business contract).
C. Automobile Liability Insurance. Consultant shall maintain automobile
insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of Consultant
arising out of or in connection with Work to be performed under this
Agreement, including coverage for any owned, hired, non -owned or rented
vehicles, in an amount not less than one million dollars ($1,000,000)
combined single limit each accident.
Raftelis Financial Consultants, Inc Page C-1
D. Professional Liability (Errors & Omissions) Insurance. Consultant shall
maintain professional liability insurance that covers the Services to be
performed in connection with this Agreement, in the minimum amount of
one million dollars ($1,000,000) per claim and two million dollars
($2,000,000) in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the Effective Date of this Agreement and
Consultant agrees to maintain continuous coverage through a period no
less than three years after completion of the Services required by this
Agreement.
4. Other Insurance Requirements. The policies are to contain, or be endorsed to
contain, the following provisions.-
A.
rovisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation against
City, its City Council, boards and commissions, officers, agents, volunteers
and employees or shall specifically allow Consultant or others providing
insurance evidence in compliance with these requirements to waive their
right of recovery prior to a loss. Consultant hereby waives its own right of
recovery against City, and shall require similar written express waivers from
each of its subconsultants.
B. Additional Insured Status. All liability policies including general liability,
excess liability, pollution liability, and automobile liability, if required, but not
including professional liability, shall provide or be endorsed to provide that
City, its City Council, boards and commissions, officers, agents, volunteers
and employees shall be included as insureds under such policies.
C. Primary and Non Contributory_. All liability coverage shall apply on a primary
basis and shall not require contribution from any insurance or self-insurance
maintained by City.
D. Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days' notice of cancellation (except for nonpayment for which ten
(10) calendar days' notice is required) or nonrenewal of coverage for each
required coverage.
5. Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Consultant shall provide certificates of insurance to
City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other
endorsements as specified herein for each coverage. Insurance certificates
and endorsement must be approved by City's Risk Manager prior to
commencement of performance. Current certification of insurance shall be
kept on file with City at all times during the term of this Agreement. The
certificates and endorsements for each insurance policy shall be signed by
a person authorized by that insurer to bind coverage on its behalf. At least
Raftelis Financial Consultants, Inc Page C-2
fifteen (15) days prior to the expiration of any such policy, evidence of
insurance showing that such insurance coverage has been renewed or
extended shall be filed with the City. If such coverage is cancelled or
reduced, Consultant shall, within ten (10) days after receipt of written notice
of such cancellation or reduction of coverage, file with the City evidence of
insurance showing that the required insurance has been reinstated or has
been provided through another insurance company or companies. City
reserves the right to require complete, certified copies of all required
insurance policies, at any time.
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Consultant sixty (60) calendar days' advance
written notice of such change. If such change results in substantial
additional cost to Consultant, City and Consultant may renegotiate
Consultant's compensation.
C. Right to Review Subcontracts. Consultant agrees that upon request, all
agreements with subcontractors or others with whom Consultant enters into
contracts with on behalf of City will be submitted to City for review. Failure
of City to request copies of such agreements will not impose any liability on
City, or its employees. Consultant shall require and verify that all
subcontractors maintain insurance meeting all the requirements stated
herein, and Consultant shall ensure that City is an additional insured on
insurance required from subcontractors. For CGL coverage,
subcontractors shall provide coverage with a format at least as broad as CG
20 38 04 13.
D. Enforcement of Agreement Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of City to inform
Consultant of non-compliance with any requirement imposes no additional
obligations on City nor does it waive any rights hereunder.
E. Requirements not Limiting. Requirements of specific coverage features or
limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided
by any insurance. Specific reference to a given coverage feature is for
purposes of clarification only as it pertains to a given issue and is not
intended by any party or insured to be all inclusive, or to the exclusion of
other coverage, or a waiver of any type. If the Consultant maintains higher
limits than the minimums shown above, the City requires and shall be
entitled to coverage for higher limits maintained by the Consultant. Any
available insurance proceeds in excess of the specified minimum limits of
insurance and coverage shall be available to the City.
F. Self-insured Retentions. Any self-insured retentions must be declared to
and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-
Raftelis Financial Consultants, Inc Page C-3
insurance will not be considered to comply with these requirements unless
approved by City.
G. City Remedies for Non -Compliance. If Consultant or any subconsultant fails
to provide and maintain insurance as required herein, then City shall have
the right but not the obligation, to purchase such insurance, to terminate this
Agreement, or to suspend Consultant's right to proceed until proper
evidence of insurance is provided. Any amounts paid by City shall, at City's
sole option, be deducted from amounts payable to Consultant or reimbursed
by Consultant upon demand.
H. Timely Notice of Claims. Consultant shall give City prompt and timely notice
of claims made or suits instituted that arise out of or result from Consultant's
performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies. City assumes no
obligation or liability by such notice, but has the right (but not the duty) to
monitor the handling of any such claim or claims if they are likely to involve
City.
Consultant's Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
judgment may be necessary for its proper protection and prosecution of the
Work.
Raftelis Financial Consultants, Inc Page C-4
OO
AMENDMENT NO. TWO TO
co PROFESSIONAL SERVICES AGREEMENT
WITH RAFTELIS FINANCIAL CONSULTANTS, INC. FOR
2019 WATER RATE STUDY
THIS AMENDMENT NO. TWO TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. Two") is made and entered into as of this 1st day of February, 2021
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and RAFTELIS FINANCIAL
CONSULTANTS, INC., a North Carolina corporation ("Consultant"), whose address is
227 West Trade Street, Suite 1400, Charlotte, NC 28202, and is made with reference to
the following:
RECITALS
A. On March 12, 2019, City and Consultant entered into a Professional Services
Agreement ("Agreement") for Consultant to conduct the City's 2019 Water Rate
Study ("Project").
B. On February 3, 2020, City and Consultant entered into Amendment No. One to the
Agreement ("Amendment No. One") to extend the term of the Agreement to March
31, 2021, and to update the insurance requirements.
C. The parties desire to enter into this Amendment No. Two to extend the term of the
Agreement to September 30, 2021 and to update the insurance requirements.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties
as follows:
1. TERM
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on September 30, 2021, unless terminated earlier as set forth herein."
2. INSURANCE REQUIREMENTS
Exhibit C of the Agreement shall be deleted in its entirety and replaced with Exhibit
C, attached hereto and incorporated herein by reference. Any reference to Exhibit C in
the Agreement shall hereafter refer to Exhibit C attached hereto.
3. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
IN WITNESS WHEREOF, the parties have caused this Amendment No. Two to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATT NEY'S 9FFICE
Date: IZ l
By:C,,--(—#�
Aaron C. Harp
City Attorney
ATTEST:I!/
�, �/_ 4
Date:
c R
By:
Leilani I. Brown
City Clerk
Attachments
CITY OF NEWPORT BEACH,
a California Inunicipal corporation
Date: a I f j I I
By:
Gra e . Leung
City'llanager
CONSULTANT: RAFTELIS FINANCIAL
CONSULTANTS, INC., a North Carolina
corporation
Date:
By:
Elaine Conti
Vice President
Date: /5 �'
.... _atthew tel i. ✓ .
,/
Secretary
[END OF SIGNATURES]
Exhibit C — Insurance Requirements
Raftelis Financial Consultants, Inc Page 2
EXHIBIT C
INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1. Provision of Insurance. Without limiting Consultant's indemnification of City, and
prior to commencement of Work, Consultant shall obtain, provide and maintain at
its own expense during the term of this Agreement, policies of insurance of the
type and amounts described below and in a form satisfactory to City. Consultant
agrees to provide insurance in accordance with requirements set forth here. If
Consultant uses existing coverage to comply and that coverage does not meet
these requirements, Consultant agrees to amend, supplement or endorse the
existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Consultant shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury by
disease in accordance with the laws of the State of California, Section 3700
of the Labor Code.
Consultant shall submit to City, along with the certificate of insurance, a.
Waiver of Subrogation endorsement in favor of City, its City Council, boards
and commissions, officers, agents, volunteers and employees.
B. General Liability Insurance. Consultant shall maintain commercial general
liability insurance, and if necessary umbrella liability insurance, with
coverage at least as broad as provided by Insurance Services Office form
CG 00 01, in an amount not less than one million dollars ($1,000,000) per
occurrence, two million dollars ($2,000,000) general aggregate. The policy
shall cover liability arising from premises, operations, personal and
advertising injury, and liability assumed under an insured contract (including
the tort liability of another assumed in a business contract).
C. Automobile Liability Insurance. Consultant shall maintain automobile
insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of Consultant
arising out of or in connection with Work to be performed under this
Agreement, including coverage for any owned, hired, non -owned or rented
vehicles, in an amount not less than one million dollars ($1,000,000)
combined single limit each accident.
Raftelis Financial Consultants, Inc Page C-1
4. Other Insurance Requirements. The policies are to contain, or be endorsed to
contain, the following provisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation against
City, its City Council, boards and commissions, officers, agents, volunteers
and employees or shall specifically allow Consultant or others providing
insurance evidence in compliance with these requirements to waive their
right of recovery prior to a loss. Consultant hereby waives its own right of
recovery against City, and shall require similar written express waivers from
each of its subconsultants.
B. Additional Insured Status. All liability policies including general liability,
excess liability, pollution liability, and automobile liability, if required, but not
including professional liability, shall provide or be endorsed to provide that
City, its City Council, boards and commissions, officers, agents, volunteers
and employees shall be included as insureds under such policies.
C. Primary and Non Contributory. All liability coverage shall apply on a primary
basis and shall not require contribution from any insurance or self-insurance
maintained by City.
D. Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days' notice of cancellation (except for nonpayment for which ten
(10) calendar days' notice is required) or nonrenewal of coverage for each
required coverage.
5. Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Consultant shall provide certificates of insurance to
City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other
endorsements as specified herein for each coverage. Insurance certificates
and endorsement must be approved by City's Risk Manager prior to
commencement of performance. Current certification of insurance shall be
kept on file with City at all times during the term of this Agreement. The
certificates and endorsements for each insurance policy shall be signed by
a person authorized by that insurer to bind coverage on its behalf. At least
fifteen (15) days prior to the expiration of any such policy, evidence of
insurance showing that such insurance coverage has been renewed or
extended shall be filed with the City. If such coverage is cancelled or
reduced, Consultant shall, within ten (10) days after receipt of written notice
of such cancellation or reduction of coverage, file with the City evidence of
insurance showing that the required insurance has been reinstated or has
been provided through another insurance company or companies. City
reserves the right to require complete, certified copies of all required
insurance policies, at any time.
Raftelis Financial Consultants, Inc Page C-2
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Consultant sixty (60) calendar days' advance
written notice of such change. If such change results in substantial
additional cost to Consultant, City and Consultant may renegotiate
Consultant's compensation.
C. Right to Review Subcontracts. Consultant agrees that upon request, all
agreements with subcontractors or others with whom Consultant enters into
contracts with on behalf of City will be submitted to City for review. Failure
of City to request copies of such agreements will not impose any liability on
City, or its employees. Consultant shall require and verify that all
subcontractors maintain insurance meeting all the requirements stated
herein, and Consultant shall ensure that City is an additional insured on
insurance required from subcontractors. For CGL coverage,
subcontractors shall provide coverage with a format at least as broad as CG
20 38 04 13.
D. Enforcement of Agreement Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of City to inform
Consultant of non-compliance with any requirement imposes no additional
obligations on City nor does it waive any rights hereunder.
E. Requirements not Limiting. Requirements of specific coverage features or
limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided
by any insurance. Specific reference to a given coverage feature is for
purposes of clarification only as it pertains to a given issue and is not
intended by any party or insured to be all inclusive, or to the exclusion of
other coverage, or a waiver of any type. If the Consultant maintains higher
limits than the minimums shown above, the City requires and shall be
entitled to coverage for higher limits maintained by the Consultant. Any
available insurance proceeds in excess of the specified minimum limits of
insurance and coverage shall be available to the City.
F. Self-insured Retentions. Any self-insured retentions must be declared to
and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-
insurance will not be considered to comply with these requirements unless
approved by City.
G. City Remedies for Non -Compliance. If Consultant or any subconsultant fails
to provide and maintain insurance as required herein, then City shall have
the right but not the obligation, to purchase such insurance, to terminate this
Agreement, or to suspend Consultant's right to proceed until proper
evidence of insurance is provided. Any amounts paid by City shall, at City's
sole option, be deducted from amounts payable to Consultant or reimbursed
by Consultant upon demand.
Raftelis Financial Consultants, Inc Page C-3
H. Timely Notice of Claims. Consultant shall give City prompt and timely notice
of claims made or suits instituted that arise out of or result from Consultant's
performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies. City assumes no
obligation or liability by such notice, but has the right (but not the duty) to
monitor the handling of any such claim or claims if they are likely to involve
City.
Consultant's Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
judgment may be necessary for its proper protection and prosecution of the
Work.
Raftelis Financial Consultants, Inc Page C-4
1
�fJ
AMENDMENT NO. ONE TO
PROFESSIONAL SERVICES AGREEMENT
WITH RAFTELIS FINANCIAL CONSULTANTS, INC. FOR
2019 WATER RATE STUDY
THIS AMENDMENT NO. ONE TO PROFESSIONAL SERVICES AGREEMENT
("Amendment No. One") is made and entered into as of this 3rd day of February, 2020
("Effective Date"), by and between the CITY OF NEWPORT BEACH, a California
municipal corporation and charter city ("City"), and RAFTELIS FINANCIAL
CONSULTANTS, INC., a North Carolina corporation ("Consultant"), whose address is
227 West Trade Street, Suite 1400, Charlotte, North Carolina 28202, and is made with
reference to the following:
RECITALS
A. On March 12, 2019, City and Consultant entered into a Professional Services
Agreement ("Agreement") for Consultant to conduct the City's 2019 Water Rate
Study ("Project").
B. The parties desire to enter into this Amendment No. One to extend the term of the
Agreement to March 31, 2021, and to update the insurance requirements.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties
as follows:
1. TERM
Section 1 of the Agreement is amended in its entirety and replaced with the
following: "The term of this Agreement shall commence on the Effective Date, and shall
terminate on March 31, 2021, unless terminated earlier as set forth herein."
2. INSURANCE REQUIREMENTS
Exhibit C to the Agreement shall be amended in its entirety and replaced with
Exhibit C attached hereto and incorporated herein.
3. INTEGRATED CONTRACT
Except as expressly modified herein, all other provisions, terms, and covenants
set forth in the Agreement shall remain unchanged and shall be in full force and effect.
[SIGNATURES ON NEXT PAGE]
IN WITNESS WHEREOF, the parties have caused this Amendment No. One to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: 02 1-,2s7Z Zoo
By.
c
C. Harp
F,,,-..AaronCity Attorney
ATTEST:
Date: �(
11,IG/
Leilani If...wnCity Clerk
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: ;3o' 2y2 --o
By:
rGr c K. Leung
Manager
CONSULTANT: Raftelis Financial
Consultants, Inc., a North Carolina
corporation
Date: 3Z /ZOZO
By:V41
Elaine Conti
Vice President
Date:
By: J/�� kt4WG,"�_
Matthew R. Jackson
Corporate Secretary
[END OF SIGNATURES]
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Raftelis Financial Consultants, Inc. Page 2
EXHIBIT C
INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1. Provision of Insurance. Without limiting Consultant's indemnification of City,
and prior to commencement of Work, Consultant shall obtain, provide and
maintain at its own expense during the term of this Agreement, policies of
insurance of the type and amounts described below and in a form satisfactory
to City. Consultant agrees to provide insurance in accordance with
requirements set forth here. If Consultant uses existing coverage to comply
and that coverage does not meet these requirements, Consultant agrees to
amend, supplement or endorse the existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Consultant shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury
by disease in accordance with the laws of the State of California, Section
3700 of the Labor Code.
Consultant shall submit to City, along with the certificate of insurance, a
Waiver of Subrogation endorsement in favor of City, its City Council,
boards and commissions, officers, agents, volunteers and employees.
B. General Liability Insurance. Consultant shall maintain commercial
general liability insurance, and if necessary umbrella liability insurance,
with coverage at least as broad as provided by Insurance Services Office
form CG 00 01, in an amount not less than one million dollars
($1,000,000) per occurrence, two million dollars ($2,000,000) general
aggregate. The policy shall cover liability arising from premises,
operations, personal and advertising injury, and liability assumed under
an insured contract (including the tort liability of another assumed in a
business contract).
C. Automobile Liability Insurance. Consultant shall maintain automobile
insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of Consultant
arising out of or in connection with Work to be performed under this
Agreement, including coverage for any owned, hired, non -owned or
Raftelis Financial Consultants, Inc. Page C-1
rented vehicles, in an amount not less than one million dollars
($1,000,000) combined single limit each accident.
D. Professional Liability (Errors & Omissions) Insurance. Consultant shall
maintain professional liability insurance that covers the Services to be
performed in connection with this Agreement, in the minimum amount of
one million dollars ($1,000,000) per claim and two million dollars
($2,000,000) in the aggregate. Any policy inception date, continuity
date, or retroactive date must be before the Effective Date of this
Agreement and Consultant agrees to maintain continuous coverage
through a period no less than three years after completion of the
Services required by this Agreement.
4. Other Insurance Requirements. The policies are to contain, or be endorsed to
contain, the following provisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation
against City, its City Council, boards and commissions, officers, agents,
volunteers and employees or shall specifically allow Consultant or others
providing insurance evidence in compliance with these requirements to
waive their right of recovery prior to a loss. Consultant hereby waives its
own right of recovery against City, and shall require similar written
express waivers from each of its subconsultants.
B. Additional Insured Status. All liability policies including general liability,
excess liability, pollution liability, and automobile liability, if required, but
not including professional liability, shall provide or be endorsed to
provide that City, its City Council, boards and commissions, officers,
agents, volunteers and employees shall be included as insureds under
such policies.
C. Primary and Non Contributory. All liability coverage shall apply on a
primary basis and shall not require contribution from any insurance or
self-insurance maintained by City.
D. Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days' notice of cancellation (except for nonpayment for which
ten (10) calendar days' notice is required) or nonrenewal of coverage for
each required coverage.
5. Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Consultant shall provide certificates of
insurance to City as evidence of the insurance coverage required herein,
along with a waiver of subrogation endorsement for workers'
compensation and other endorsements as specified herein for each
Raftelis Financial Consultants, Inc. Page C-2
coverage. Insurance certificates and endorsement must be approved
by City's Risk Manager prior to commencement of performance. Current
certification of insurance shall be kept on file with City at all times during
the term of this Agreement. The certificates and endorsements for each
insurance policy shall be signed by a person authorized by that insurer
to bind coverage on its behalf. At least fifteen (15) days prior to the
expiration of any such policy, evidence of insurance showing that such
insurance coverage has been renewed or extended shall be filed with
the City. If such coverage is cancelled or reduced, Consultant shall,
within ten (10) days after receipt of written notice of such cancellation or
reduction of coverage, file with the City evidence of insurance showing
that the required insurance has been reinstated or has been provided
through another insurance company or companies. City reserves the
right to require complete, certified copies of all required insurance
policies, at any time.
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Consultant sixty (60) calendar days'
advance written notice of such change. If such change results in
substantial additional cost to Consultant, City and Consultant may
renegotiate Consultant's compensation.
C. Enforcement of Agreement Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of City to inform
Consultant of non-compliance with any requirement imposes no
additional obligations on City nor does it waive any rights hereunder.
D. Requirements not Limiting. Requirements of specific coverage features
or limits contained in this Section are not intended as a limitation on
coverage, limits or other requirements, or a waiver of any coverage
normally provided by any insurance. Specific reference to a given
coverage feature is for purposes of clarification only as it pertains to a
given issue and is not intended by any party or insured to be all inclusive,
or to the exclusion of other coverage, or a waiver of any type. If the
Consultant maintains higher limits than the minimums shown above, the
City requires and shall be entitled to coverage for higher limits
maintained by the Consultant. Any available insurance proceeds in
excess of the specified minimum limits of insurance and coverage shall
be available to the City.
E. Self-insured Retentions. Any self-insured retentions must be declared
to and approved by City. City reserves the right to require that self-
insured retentions be eliminated, lowered, or replaced by a deductible.
Self-insurance will not be considered to comply with these requirements
unless approved by City.
Raftelis Financial Consultants, Inc. Page C-3
F. City Remedies for Non -Compliance. If Consultant or any subconsultant
fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to
terminate this Agreement, or to suspend Consultant's right to proceed
until proper evidence of insurance is provided. Any amounts paid by
City shall, at City's sole option, be deducted from amounts payable to
Consultant or reimbursed by Consultant upon demand.
G. Timely Notice of Claims. Consultant shall give City prompt and timely
notice of claims made or suits instituted that arise out of or result from
Consultant's performance under this Agreement, and that involve or may
involve coverage under any of the required liability policies. City
assumes no obligation or liability by such notice, but has the right (but
not the duty) to monitor the handling of any such claim or claims if they
are likely to involve City.
H. Consultant's Insurance. Consultant shall also procure and maintain, at
its own cost and expense, any additional kinds of insurance, which in its
own judgment may be necessary for its proper protection and
prosecution of the Work.
Raftelis Financial Consultants, Inc. Page C-4
PROFESSIONAL SERVICES AGREEMENT
WITH RAFTELIS FINANCIAL CONSULTANTS, INC. FOR
2019 WATER RATE STUDY
THIS PROFESSIONAL SERVICES AGREEMENT ("Agreement") is made and
entered into as of this 12th day of March, 2019 ("Effective Date"), by and between the
CITY OF NEWPORT BEACH, a California municipal corporation and charter city ("City"),
and RAFTELIS FINANCIAL CONSULTANTS, INC., a North Carolina corporation
("Consultant"), whose address is 227 West Trade Street, Suite 1400, Charlotte, North
Carolina 28202, and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City desires to engage Consultant to conduct the City's 2019 Water Rate Study
("Project").
C. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the professional services described in this Agreement.
D. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties
as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate on March 31, 2020, unless terminated earlier as set forth herein.
2. SERVICES TO BE PERFORMED
Consultant shall diligently perform all the services described in the Scope of
Services attached hereto as Exhibit A and incorporated herein by reference ("Services"
or "Work"). City may elect to delete certain Services within the Scope of Services at its
sole discretion.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of Services under this Agreement
and Consultant shall perform the Services in accordance with the schedule included in
Exhibit A. In the absence of a specific schedule, the Services shall be performed to
completion in a diligent and timely manner. The failure by Consultant to strictly adhere to
the schedule set forth in Exhibit A, if any, or perform the Services in a diligent and timely
manner may result in termination of this Agreement by City.
3.2 Notwithstanding the foregoing, Consultant shall not be responsible for
delays due to causes beyond Consultant's reasonable control. However, in the case of
any such delay in the Services to be provided for the Project, each party hereby agrees
to provide notice within two (2) calendar days of the occurrence causing the delay to the
other party so that all delays can be addressed.
3.3 Consultant shall submit all requests for extensions of time for performance
in writing to the Project Administrator as defined herein not later than ten (10) calendar
days after the start of the condition that purportedly causes a delay. The Project
Administrator shall review all such requests and may grant reasonable time extensions
for unforeseeable delays that are beyond Consultant's control.
3.4 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the circumstances, by
hand -delivery or mail.
4. COMPENSATION TO CONSULTANT
4.1 City shall pay Consultant for the Services on a time and expense not -to -
exceed basis in accordance with the provisions of this Section and the Schedule of Billing
Rates attached hereto as Exhibit B and incorporated herein by reference. City shall pay
to Consultant and Consultant accepts as full payment for all Work performed in
accordance with this Agreement, including all reimbursable items the sum of One
Hundred Thirty Nine Thousand Four Hundred Twenty One Dollars and 00/100
($139,421.00). Additionally, the City has allocated a contingency amount of Thirteen
Thousand Nine Hundred Seventy Nine Dollars and 00/100 ($13,979.00) for
unexpected costs, for a total not to exceed amount of One Hundred Fifty 'Three
Thousand Four Hundred Dollars and 00/100 ($153,400.00). No portion of the
contingency shall be expended without prior written approval of City's Project
Administrator.
4.2 No billing rate changes shall be made during the term of this Agreement
without the prior written approval of City.
4.3 Consultant shall submit monthly invoices to City describing the Work
performed the preceding month. Consultant's bills shall include the name of the person
who performed the Work, a brief description of the Services performed and/or the specific
task in the Scope of Services to which it relates, the date the Services were performed,
the number of hours spent on all Work billed on an hourly basis, and a description of any
reimbursable expenditures. City shall pay Consultant no later than thirty (30) calendar
days after approval of the monthly invoice by City staff.
4.4 City shall reimburse Consultant only for those costs or expenses specifically
identified in Exhibit B to this Agreement or specifically approved in writing in advance by
City.
Raftelis Financial Consultants, Inc. Page 2
4.5 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
Work that is determined by City to be necessary for the proper completion of the Project,
but which is not included within the Scope of Services and which the parties did not
reasonably anticipate would be necessary at the execution of this Agreement.
Compensation for any authorized Extra Work shall be paid in accordance with the
Schedule of Billing Rates as set forth in Exhibit B.
5. PROJECT MANAGER
5.1 Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Sanjay Gaur to be its
Project Manager. Consultant shall not remove or reassign the Project Manager or any
personnel listed in Exhibit A or assign any new or replacement personnel to the Project
without the prior written consent of City. City's approval shall not be unreasonably
withheld with respect to the removal or assignment of non -key personnel.
5.2 Consultant, at the sole discretion of City, shall remove from the Project any
of its personnel assigned to the performance of Services upon written request of City.
Consultant warrants that it will continuously furnish the necessary personnel to complete
the Project on a timely basis as contemplated by this Agreement.
5.3 If Consultant is performing inspection services for City, the Project Manager
and any other assigned staff shall be equipped with a cellular phone to communicate with
City staff. The Project Manager's cellular phone number shall be provided to City.
6. ADMINISTRATION
This Agreement will be administered by the Utilities Department. City's Utilities
Department Director or designee shall be the Project Administrator and shall have the
authority to act for City under this Agreement. The Project Administrator shall represent
City in all matters pertaining to the Services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to provide access to and upon request of Consultant, one copy of all existing
relevant information on file at City. City will provide all such materials in a timely manner
so as not to cause delays in Consultant's Work schedule.
8. STANDARD OF CARE
8.1 All of the Services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the Services required by this Agreement, and that it will
perform all Services in a manner commensurate with community professional standards
and with the ordinary degree of skill and care that would be used by other reasonably
Raftelis Financial Consultants, Inc. Page 3
competent practitioners of the same discipline under similar circumstances. All Services
shall be performed by qualified and experienced personnel who are not employed by City.
By delivery of completed Work, Consultant certifies that the Work conforms to the
requirements of this Agreement, all applicable federal, state and local laws, and legally
recognized professional standards.
8.2 Consultant represents and warrants to City that it has, shall obtain, and shall
keep in full force and effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.3 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, acts of God, or the failure of City to furnish timely information or to
approve or disapprove Consultant's Work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
9.1 To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions, officers, agents,
volunteers and employees (collectively, the "Indemnified Parties") from and against any
and all claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorneys' fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims"), which may arise from or in any manner relate
(directly or indirectly) to any breach of the terms and conditions of this Agreement, any
Work performed or Services provided under this Agreement including, without limitation,
defects in workmanship or materials or Consultant's presence or activities conducted on
the Project (including the negligent, reckless, and/or willful acts, errors and/or omissions
of Consultant, its principals, officers, agents, employees, vendors, suppliers, consultants,
subcontractors, anyone employed directly or indirectly by any of them or for whose acts
they may be liable, or any or all of them).
9.2 Notwithstanding the foregoing, nothing herein shall be construed to require
Consultant to indemnify the Indemnified Parties from any Claim arising from the sole
negligence or willful misconduct of the Indemnified Parties. Nothing in this indemnity shall
be construed as authorizing any award of attorneys' fees in any action on or to enforce
the terms of this Agreement. This indemnity shall apply to all claims and liability
regardless of whether any insurance policies are applicable. The policy limits do not act
as a limitation upon the amount of indemnification to be provided by Consultant.
10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
Raftelis Financial Consultants, Inc. Page 4
conducting the Work are under the control of Consultant, except to the extent they are
limited by statute, rule or regulation and the expressed terms of this Agreement. No civil
service status or other right of employment shall accrue to Consultant or its employees.
Nothing in this Agreement shall be deemed to constitute approval for Consultant or any
of Consultant's employees or agents, to be the agents or employees of City. Consultant
shall have the responsibility for and control over the means of performing the Work,
provided that Consultant is in compliance with the terms of this Agreement. Anything in
this Agreement that may appear to give City the right to direct Consultant as to the details
of the performance of the Work or to exercise a measure of control over Consultant shall
mean only that Consultant shall follow the desires of City with respect to the results of the
Services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
Work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in order
to ensure the Project proceeds in a manner consistent with City goals and policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator informed on a
regular basis regarding the status and progress of the Project, activities performed and
planned, and any meetings that have been scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of Work, Consultant shall obtain, provide and maintain at its own expense during the term
of this Agreement or for other periods as specified in this Agreement, policies of insurance
of the type, amounts, terms and conditions described in the Insurance Requirements
attached hereto as Exhibit C, and incorporated herein by reference.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the Services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall be
construed as an assignment: The sale, assignment, transfer or other disposition of any
of the issued and outstanding capital stock of Consultant, or of the interest of any general
partner or joint venturer or syndicate member or cotenant if Consultant is a partnership or
joint -venture or syndicate or co -tenancy, which shall result in changing the control of
Raftelis Financial Consultants, Inc. Page 5
Consultant. Control means fifty percent (50%) or more of the voting power or twenty-five
percent (25%) or more of the assets of the corporation, partnership or joint -venture.
16. SUBCONTRACTING
The subcontractors authorized by City, if any, to perform Work on this Project are
identified in Exhibit A. Consultant shall be fully responsible to City for all acts and
omissions of any subcontractor. Nothing in this Agreement shall create any contractual
relationship between City and any subcontractor nor shall it create any obligation on the
part of City to pay or to see to the payment of any monies due to any such subcontractor
other than as otherwise required by law. City is an intended beneficiary of any Work
performed by the subcontractor for purposes of establishing a duty of care between the
subcontractor and City. Except as specifically authorized herein, the Services to be
provided under this Agreement shall not be otherwise assigned, transferred, contracted
or subcontracted out without the prior written approval of City.
17. OWNERSHIP OF DOCUMENTS
17.1 Each and every report, draft, map, record, plan, document and other writing
produced, including but not limited to, websites, blogs, social media accounts and
applications (hereinafter "Documents"), prepared or caused to be prepared by Consultant,
its officers, employees, agents and subcontractors, in the course of implementing this
Agreement, shall become the exclusive property of City, and City shall have the sole right
to use such materials in its discretion without further compensation to Consultant or any
other party. Additionally, all material posted in cyberspace by Consultant, its officers,
employees, agents and subcontractors, in the course of implementing this Agreement,
shall become the exclusive property of City, and City shall have the sole right to use such
materials in its discretion without further compensation to Consultant or any other party.
Consultant shall, at Consultant's expense, provide such Documents, including all logins
and password information to City upon prior written request.
17.2 Documents, including drawings and specifications, prepared by Consultant
pursuant to this Agreement are not intended or represented to be suitable for reuse by
City or others on any other project. Any use of completed Documents for other projects
and any use of incomplete Documents without specific written authorization from
Consultant will be at City's sole risk and without liability to Consultant. Further, any and
all liability arising out of changes made to Consultant's deliverables under this Agreement
by City or persons other than Consultant is waived against Consultant, and City assumes
full responsibility for such changes unless City has given Consultant prior notice and has
received from Consultant written consent for such changes.
17.3 All written documents shall be transmitted to City in formats compatible with
Microsoft Office and/or viewable with Adobe Acrobat.
Raftelis Financial Consultants, Inc. Page 6
18. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the Services in this Agreement, shall be kept confidential
unless City expressly authorizes in writing the release of information.
19. INTELLECTUAL PROPERTY INDEMNITY
Consultant shall defend and indemnify City, its agents, officers, representatives
and employees against any and all liability, including costs, for infringement or alleged
infringement of any United States' letters patent, trademark, or copyright, including costs,
contained in Consultant's Documents provided under this Agreement.
20. RECORDS
Consultant shall keep records and invoices in connection with the Services to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any Services,
expenditures and disbursements charged to City, for a minimum period of three (3) years,
or for any longer period required by law, from the date of final payment to Consultant
under this Agreement. All such records and invoices shall be clearly identifiable.
Consultant shall allow a representative of City to examine, audit and make transcripts or
copies of such records and invoices during regular business hours. Consultant shall allow
inspection of all Work, data, Documents, proceedings and activities related to the
Agreement for a period of three (3) years from the date of final payment to Consultant
under this Agreement.
21. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction of
the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall not
discontinue Work as a result of such withholding. Consultant shall have an immediate
right to appeal to the City Manager or designee with respect to such disputed sums.
Consultant shall be entitled to receive interest on any withheld sums at the rate of return
that City earned on its investments during the time period, from the date of withholding of
any amounts found to have been improperly withheld.
22. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would have
resulted if there were not errors or omissions in the Work accomplished by Consultant,
the additional design, construction and/or restoration expense shall be borne by
Consultant. Nothing in this Section is intended to limit City's rights under the law or any
other sections of this Agreement.
Raftelis Financial Consultants, Inc. Page 7
23. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the Project.
24. CONFLICTS OF INTEREST
24.1 Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act") and/or Government Code §§ 1090 et
seq., which (1) require such persons to disclose any financial interest that may
foreseeably be materially affected by the Work performed under this Agreement, and (2)
prohibit such persons from making, or participating in making, decisions that will
foreseeably financially affect such interest.
24.2 If subject to the Act and/or Government Code §§ 1090 et seq., Consultant
shall conform to all requirements therein. Failure to do so constitutes a material breach
and is grounds for immediate termination of this Agreement by City. Consultant shall
indemnify and hold harmless City for any and all claims for damages resulting from
Consultant's violation of this Section.
25. NOTICES
25.1 All notices, demands, requests or approvals, including any change in
mailing address, to be given under the terms of this Agreement shall be given in writing,
and conclusively shall be deemed served when delivered personally, or on the third
business day after the deposit thereof in the United States mail, postage prepaid, first-
class mail, addressed as hereinafter provided.
25.2 All notices, demands, requests or approvals from Consultant to City shall
be addressed to City at-
Attn: Utilities Department Director
Utilities Department
City of Newport Beach
100 Civic Center Drive
PO Box 1768
Newport Beach, CA 92658
25.3 All notices, demands, requests or approvals from City to Consultant shall
be addressed to Consultant at:
Attn: Sanjay Gaur
Raftelis Financial Consultants, Inc.
445 South Figueroa Street, Suite 2270
Los Angeles, CA 90017
_\VIRI
Unless a shorter time is specified elsewhere in this Agreement, before making its
final request for payment under this Agreement, Consultant shall submit to City, in writing,
Raftelis Financial Consultants, Inc. Page 8
all claims for compensation under or arising out of this Agreement. Consultant's
acceptance of the final payment shall constitute a waiver of all claims for compensation
under or arising out of this Agreement except those previously made in writing and
identified by Consultant in writing as unsettled at the time of its final request for payment.
Consultant and City expressly agree that in addition to any claims filing requirements set
forth in the Agreement, Consultant shall be required to file any claim Consultant may have
against City in strict conformance with the Government Claims Act (Government Code
sections 900 et seq.).
27. TERMINATION
27.1 In the event that either party fails or refuses to perform any of the provisions
of this Agreement at the time and in the manner required, that party shall be deemed in
default in the performance of this Agreement. If such default is not cured within a period
of two (2) calendar days, or if more than two (2) calendar days are reasonably required
to cure the default and the defaulting party fails to give adequate assurance of due
performance within two (2) calendar days after receipt of written notice of default,
specifying the nature of such default and the steps necessary to cure such default, and
thereafter diligently take steps to cure the default, the non -defaulting party may terminate
the Agreement forthwith by giving to the defaulting party written notice thereof.
27.2 Notwithstanding the above provisions, City shall have the right, at its sole
and absolute discretion and without cause, of terminating this Agreement at any time by
giving no less than seven (7) calendar days' prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for Services
satisfactorily performed and costs incurred up to the effective date of termination for which
Consultant has not been previously paid. On the effective date of termination, Consultant
shall deliver to City all reports, Documents and other information developed or
accumulated in the performance of this Agreement, whether in draft or final form.
28. STANDARD PROVISIONS
28.1 Recitals. City and Consultant acknowledge that the above Recitals are true
and correct and are hereby incorporated by reference into this Agreement.
28.2 Compliance with all Laws. Consultant shall, at its own cost and expense,
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. In addition, all Work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be subject
to approval of the Project Administrator and City.
28.3 Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent breach
of the same or any other term, covenant or condition contained herein, whether of the
same or a different character.
Raftelis Financial Consultants, Inc. Page 9
28.4 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged herein.
No verbal agreement or implied covenant shall be held to vary the provisions herein.
28.5 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and the Scope of Services or any other
attachments attached hereto, the terms of this Agreement shall govern.
28.6 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either party by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
28.7 Amendments. This Agreement may be modified or amended only by a
written document executed by both Consultant and City and approved as to form by the
City Attorney.
28.8 Severability. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
28.9 Controlling Law and Venue. The laws of the State of California shall govern
this Agreement and all matters relating to it and any action brought relating to this
Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange, State of California.
28.10 Equal Opportunity Employment. Consultant represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because race, religious creed, color, national origin,
ancestry, physical handicap, medical condition, marital status, sex, sexual orientation,
age or any other impermissible basis under law.
28.11 No Attorneys' Fees. In the event of any dispute or legal action arising under
this Agreement, the prevailing party shall not be entitled to attorneys' fees.
28.12 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
[SIGNATURES ON NEXT PAGE]
Raftelis Financial Consultants, Inc. Page 10
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date:
By*Ar
'a U
vC. Harp A02-w'lorney
CITY OF NEWPORT BEACH,
a California municipal corporation
Date: -/ J
By-.—
Diane
y:Diane . Dixon
Mayor
ATTEST:
Date: . J 7.1
CONSULTANT: Raftelis Financial
Consultants, Inc., a North Carolina
corporation
Date:
By:
By: la
Leilani I. Brown
Elaine Conti
City Clerk
Vice President
Date: 3_q_ /
Corporate Secretary
[END OF SIGNATURES]
Attachments: Exhibit A – Scope of Services
Exhibit B – Schedule of Billing Rates
Exhibit C – Insurance Requirements
.�
r
Raftelis Financial Consultants, Inc. Page 11
EXHIBIT A
SCOPE OF SERVICES
Raftelis Financial Consultants, Inc. Page A-1
Scope
ofWork
Below is a brief list of the tasks for
the scope of work. In Appendix A we
have provided detailed descriptions
for each of the tasks.
Task 1 - Kick-off Workshop, Data Collection
and Project Management
Task 2 - Policy Framework Workshops with
City Council
Task 3 - Long -Range Financial Plan
Development
Task 4 - Cost of Service Analysis for Water
Services
Task S - Water Rates Development
Task 6 - Water Rate Workshops
Task 7 - Preparation of Cost of Service /
Preliminary Rate Analysis Report
Task 8 - Administrative Record Report
Development for Proposed Water Rates
Task 9 - Public Meetings to Present the
Final Recommendations
Task 10 - Proposition 218 Notice
Preparation and Public Hearing
Task 11 - Simplified Financial Plan Model
with Adopted Rates for Future Rate
Updates Evaluation
QUALITY ASSURANCE/QUALITY CON rROL PROCEDURES
Quality Assurance; Quality
Control Procedures
Credibility is crucial for gaining consensus to implement the pro-
posed rates developed as part of the Cost of Service Studies. If
the City does not achieve the necessary credibility then the City
Council may not approve any recommendation no matter how
critical they may be. The fastest way for the City to lose credibility
with the public and the City Council is to provide information that
is incorrect or flawed. The City must have total confidence that the
information provided by the Consultant is as accurate as possible.
Raftelis places a premium on providing high-quality and accurate
deliverables founded on sound principles of cost of service deter-
mination and rate design. While assisting other utilities across
the country we have developed a Quality Assurance process that
consistently results in accurate deliverables of the highest quality.
Each Quality Assurance plan is tailored to the specific project, but
there are a number of common elements such as senior perspec-
tive, outside perspective, and involvement from project initiation.
The Quality Assurance plan that we will implement as part of this
project embodies these elements.
The Project Team will initiate its Quality Assurance plan during
Project Initiation (Task 1). The Quality Assurance Manager will
be present at all internal project meetings and will work closely
with both the Project Director and Project Manager as well as the
lead consultants during the course of the project. It is important
to note that the Quality Assurance Manager will not be involved in
any detailed cost of service analysis or aspect of the cost of service
analysis or model development. This lack of involvement in the
intricacies of the project will allow the Quality Assurance Manager
to provide an objective review of the cost of service methodology,
rate design, and project deliverables. The Quality Assurance Man-
ager's primary responsibilities are:
• To oversee review of cost of service analysis and models for
consistency, accuracy, and validity
• To ensure that the cost of service model is based on sound
rate -making principles and standard industry practice
• To comprehensively review the written deliverables
• To comprehensively review presentations to the City Council
and the public
As noted in our proposed project organization chart, our Quality
Assurance Manager will report to our Project Director, not the
Project Manager. This ensures that the City's interests are not
diffused by the detailed activities of the Project Team. We also
want to assure that no deliverable will be provided to the City
until the Quality Assurance Manager has signed off on it. We have
included time in the project approach and schedule to allow the
necessary quality assurance reviews.
While all deliverables will receive significant review, the cost of
service model, which has the most complexity and is the linch-
pin of the project, will receive the greatest scrutiny. The quality
assurance plan includes periodic reviews of the cost of service
model throughout the course of its development. We anticipate
these periodic reviews occurring at the following stages of model
development:
• Once the basic model framework is complete
• Upon completion of the financial planning module
• Upon completion of the cost allocation schedules
• Upon completion of the retail rate calculation module
• Prior to the delivery of the final model results
SCHEDULE AND SCHEDULE CONTROL
Schedule & Schedule Control
S3
Raftelis will complete the scope of services within the timeframe shown in the schedule below. The proposed schedule
assumes a notice -to -proceed by the end of March 2019, and that Raftelis will receive the needed data in a timely manner
and be able to schedule meetings as necessary. Project completion is estimated for the beginning of January 2020. This
is tentative schedule and we will discuss and finalize with City staff the project schedule during the Kick-off Workshop.
March April May June Judy August September October November December January
1. Kick-off Workshop, Data Collection $ Project
Management
2. Policy Framework Workshops with City
Council
3. Long Range Finanical Plan Development
4. Cost of Service for Water Services
5. Water Rates Development
6. Water Rate Workshops
7. Preparation of Cost of Service i Preliminary
Rate Analysis Report
8. Administrative Report Development for
Proposed Water Rates
9. Public Meetings to Present the Final
Recommendations
10. Proposition 218 Notice Preparation and
Public Hearing
11. Simplified Financial Master Model with
Adopted Rates for Future Rate Updates
Evaluation
RECYCLED WATER RATE STUDY
Recycled Water
Rate Study
The City operates a small recycled water (RW) system for 6 commercial customers. The majority of the recycled water system
is owned by the Orange County Water District and the City primarily passes through its direct cost to the customers.
As part of the Study, the City also requests that the Consultant conduct the RW Rate Study for its 6 customers. Similar to
Water Rate Study, the RW Rate Study will comprise of the following components:
• Financial Plan for RW Enterprise to ensure long-term financial sufficiency for the RW system
• Cost of service analysis for the RW system to equitably allocate the RW system costs to the 6 customers based on their
own usage characteristics
• RW rate calculation module to calculate the multi-year rates along with customer impact analysis
Raftelis estimates to complete this task with approximately 40 hours of staff time, billed on a time and material basis and
not including public meetings. If the Study is not conducted concurrently with the Water Rate Study, more staff effort
might be needed to conduct public meetings to present the results of the Study.
35
RESERVE POLICY REVIEW (OPTIONAL TASK)
Reserve Pofl*cy..-Review
(Optional Task)
If requested by the City, Raftelis will review in detail the Reserve Policy. Each Reserve has its purpose and its target level
shall be identified based on justifiable and sound bases. Raftelis will review the logics established for current reserve policy
and recommend necessary changes to the policy. Moreover, Raftelis will also utilize the Financial Plan Model to assess the
proposed changes in Reserve Policy to help the City making informed decisions. Raftelis will summary the results of the
assessment and the rationale for each reserve target level in a short White Paper or Report. Mr. Gaur has recently spoke at the
ACWA conference on how to develop the appropriate reserve policy and to understand the different types of financial risk. In
addition, Mr. Gaur in 2014 published an article in the AWWA Journal on reserve policy called "Why do Water Agencies need
Reserves?" Raftelis expects to complete this task with approximately 30 hours staff time, billed on a time and material basis.
S7
WATER CONSERVATION ORDINANCE UPDATE (OPTIONAL TASK)
Water Conservation
Ordinance Update
(Optional Task)
If requested by the City, Raftelis will review the current Water Conservation Ordinance (WCO). The WCO will identify the
policies for each Drought Stage and the corresponding estimated water demand reduction. Utilizing the results in the Water
Rate Study for drought rates, Raftelis will also assist the City to update its WCO to reflect the new drought rates to be in
effect. Raftelis expects to complete this task with approximately 10-16 hours of staff time, billed on a time and material basis.
39
APPENDIX A: SCOPE OF WORK
All■ SCOPE
■ OF WORK
Scope of Work
In evaluating and updating the City's water rates and rate structure, Raftelis will
use industry -accepted practices to ensure a robust and defensible rate structure.
That said, every agency exhibits different characteristics and faces different issues.
Raftelis will utilize our industry -driving technical expertise and depth of experience,
particularly with respect to water conservation rate structures, and our thorough
understanding and experience with the cost of service principles of Proposition 218.
For example, in 2018, Mr. Gaur, proposed Project Manager for this study, led an all -
day rate principles and rate design workshop at the California Society of Municipal
Finance Officers, This workshop also included lead Proposition 218 attorney, Kelly
Salt from Best, Best and Krieger (BBK), and discussed the legal framework of how to
develop defensible rate structures.
The following tasks define our technical approach in response to the City's
requested scope of services. It should be noted that while we have listed these tasks
consecutii/,�?Iy, some tasks will overlap and may be conducted concurrently.
TASK i
Project Initiation,
Data Collection
and Project
Management
Project Initiation
and Data Collection
We believe that the best way to
initiate a study of this nature is
the execution of a productive
kick-off meeting. The goals for
the meeting include:
• Providing a forum to
finalize the work plan and
schedule with City staff
• Reviewing the data require-
ments for the study
Prior to the kick-off meeting,
we will prepare a detailed data
request list that will identify
the information needed to
complete the various analyses.
Information that is typically
required to perform a finan-
cial plan and water rate study
include, for example: recent
Comprehensive Annual
Financial Reports (CAFR);
recent and current budgets;
current and historical billing
data; and a long-term capital
improvement program. Some
of this information will be
readily available, whereas other
components may require more
detailed analyses of operational
data, customer billing informa-
tion, and costs.
Raftelis will review any data
received prior to the kick-off
meeting in order to address any
questions arising from these
sources.
Project Management
Consistent and competent pro-
ject management is required
to ensure project success and
adherence to timelines and
budgets. This ongoing task
involves multiple interrelated
work efforts that will require
effective coordination between
City staff, the consultant team,
the City Council, the public,
and other stakeholder groups.
Our management approach
stresses transparency, commu-
nication, teamwork, objectivity,
and accountability for meeting
project objectives. Manage-
ment responsibilities extend to
general administrative duties
such as client correspondence,
billing, project documenta-
tion, and administration of the
study control plan.
Throughout the study, the Raft-
elis team will schedule interim
status meetings or conference
calls/web meetings to discuss
project progress and present
preliminary results. Status
meetings will be conducted via
telephone or web conference
utilizing GoToMeeting, a web -
based conferencing tool. This
tool will help us conduct effi-
cient web meetings quickly to
discuss issues and review results
and impacts more efficiently
while minimizing costs. The
Raftelis Project Team will also
conduct face-to-face meetings
as outlined in the scope.
As part of the kick-off Work-
shop, Raftelis will work closely
with staff to identify the list of
pricing objectives and develop a
policy framework for the study.
This mechanism of identifying
and ranking pricing objectives
serves to promote stakeholder
ownership and subsequent
buy -in of the final results. Some
of the pricing objectives include
the following:
• Promotion of efficient water
use
• Reduction in total water use
• Affordability for essential use
• Need for an effective
drought management tool
• Financial sufficiency and
stability
• Rate stability
• Reduction in peak demand
• Simplicity and ease of
implementation
• Customer understanding
• Minimization of customer
impacts
Raftelis will provide City staff
the pricing objectives exercise
and instructions, which will be
presented to the City Council
at the subsequent workshop,
for review. Taking the time
to cover these foundational
topics builds the framework
for informed collaboration as
the Study progresses.
The City requests to have up to
a total of 10 public meetings,
including public workshops, to
present rate study findings and
rate alternatives and to assist
with the required Proposition
218 public hearing. During
the Kick-off Workshop Raftelis
will discuss with City staff how
to best plan out the 10 meetings
for the Study.
Meeting: One (1) on-site
kick-off workshop with
City staff
Deliverables: Data request
list, presentation materials
in Microsoft PowerPoint*"
and meeting minutes
for kick-off workshop in
Microsoft Word
TASK i
Policy Framework
Workshops with
City Council
As part of the 10 public meet-
ings, Raftelis proposes to
conduct a policy framework
workshop with City Council
or stakeholders. The actual
number of meetings for this
task will be determined and
agreed to during the kick-off
workshop.
Task 2.1 — Pricing
Objective and Policy
Framework Discussion
Workshop with City
Council
Raftelis will begin the discussion
with a review of the evolution
of rate structures and the ben-
efits and challenges associated
with each structure, including
uniform rate, seasonal rates,
inclining tiered rates, and water
budget rate structures. The goal
of this discussion and the pricing
objective exercise is for the City's
elected officials to share with
Raftelis its understanding of
available rate structures and for
Raftelis to provide the City an
overview of all applicable alter-
natives according to the City's
priorities and currently observed
best management practices.
Raftelis will present a list
of pricing objectives for the
members of the City Council
to rank. The pricing objectives
exercise and instructions
prepared in Task 1 will be
provided to the City prior to
the workshop. It is important
to note that several of these
pricing objectives can conflict
with each other, especially with
conservation rate structures.
For example, a rate philosophy
focused on improving revenue
stability may conflict with
minimizing customer impacts.
Raftelis will discuss the impli-
cations so that stakeholders
can make informed decisions.
Task 2.2 — Policy
Framework Review
with City Council
Based on the City Council's
ranking of pricing objectives
and other inputs gathered
during the workshop, Raftelis
will present the results of the
pricing objectives exercise. In
addition, Raftelis will provide
the City Council with the
basis for recommending an
alternative rate structure, as
appropriate, along with other
rate -setting principles and poli-
cies to be used for the rate study.
Whenever possible, Raftelis'
approach to presenting com-
plex and multi -faceted topics
such as rate structure compar-
isons or impacts is to offer a
combination of. 1) visual rep-
resentation; and 2) a periodic
group poll or questionnaire for
gauging knowledge and general
opinions. This method encour-
ages an environment of open
and fluid discussion, facilitat-
ing real-time understanding of
and consensus regarding the
subject matter.
Raftelis has recently completed
a pricing objectives workshop
for Santa Margarita Water
District (SMWD). Figure I
shows the results of the pricing
objectives workshop, which
categorizes the objectives from
most important to least impor-
tant based on responses received
from the SMWD Board.
SMWD was considering an
update to their existing inclin-
ing tier block rate structure
versus a water budget rate
structure. Raftelis was able to
clearly show the District how
well each rate structure met
their pricing objectives, with
a side-by-side comparison as
shown in Figure 2. The stars
in Figure 2 represent how well
each rate structure meets each
particular pricing objective.
The Board ultimately instructed
Raftelis and staff to continue
to develop and evaluate water
budget tiered rate structures
for Single -Family and Irriga-
tion meters, while retaining
the current inclining tiered rate
for Multi -Family and uniform
43
volumetric rate structure for all
other customer classes.
Recently, Raftelis has con-
ducted similar evaluations of
alternative rate structures for
Las Virgenes Municipal Water
District, Rancho California
Municipal Water District, and
the Cities of Corona, Chino
Hills, Huntington Beach, and
San Juan Capistrano. RFC has
also developed workshop for-
mats utilizing live, clicker -based
polling that has proven effective
in other settings.
Task 2.3 — Water
Budget Framework
Workshop with City
Council
If the City Council in the prior
Workshop (Task 2.2) instructs
Raftelis and City Staff to pro-
ceed with thorough evaluation
of water budget rates for the
Study, Raftelis proposes to
conduct this Workshop to
establish the Water Budget
Rate framework for the study'.
Ultimately, our goal is to seek
input from the City Council
regarding the policy options
associated with Water Budget
Rate structures. Establishing
the framework will include
determining which customer
classes are eligible for water
budget -based rate structures,
defining indoor and outdoor
allocations, and defining the
associated tiers.
For example, a sample water
budget -based rate structure
might include residential
accounts with a Tier 1 defined
as the indoor allocation, Tier 2
defined as the outdoor alloca-
tion, and Tier 3 as a percentage
of the total indoor and outdoor
allocation.
As mentioned previously,
water budget allocations for
residential customers can
be determined using a com-
J4
F I G U R E I
Santa Margarita Water District Pricing Objectives Results
Fair to the Public
Promoting Efficiency
Rate Stability
Customer Understanding
Equitable in Allocating Water Cost
Affordability for Essential Use
Equitable in Allocating CIP Cost
Consistent with Drought Management Action Plan
Ease of Implementation
Enhance Revenue Stability
Mitigate Customer Impacts
Targeting Outdoor Water Use
Consistent Residential Rates (SF & MF)
Provide Revenue Source for Recycling/Conservation
Ease of Administration
Promoting Conservation
FIGURE 2
Santa Margarita Water District Rate Structure Comparison
MOST IMPORTANT Promoting Efficiency
Rate Stability
Customer Understanding
Equitable in Allocating Water Cost
VERY IMPORTANT
Affordability for Essential Use
Equitable in Allocating CIP Cost
Consistent with Drought Management Action Plan
Ease of Implementation
IMPORTANT Enhance Revenue Stability
Mitigate Customer Impacts
Targeting Outdoor Water Use
Consistent Residential Rates (SF & MF)
Provide Revenue Source for Recycling/Conservation
LEAST IMPORTANT
Ease of Administration
Promoting Conservation
,, .
plex equation that accounts
for numerous demographic
features. For example, some
demographical features con-
sidered in determining indoor
water budget allocations might
include the following:
• Average or actual residen-
tial density per household
• Average water use per
capita per day
In addition, some demographic
features that might be consid-
ered in determining outdoor
water budget allocations might
include the following:
• Average / estimated / meas-
ured irrigation area
• Weather data measured by
EvapoTranspiration' (ET)
data
Raftelis will work with the City
to identify the methodologies
and -policy options -used to deter-
mine water budget allocations
and to perform the analysis on
the City's customer class demo-
graphics as necessary.
For example, when consid-
ering the methodology used
for determining indoor water
budget allocations, different
options for evaluating house-
hold size can be used, each
with its own set of benefits
and drawbacks aimed at meet-
ing various objectives. Using
actual residential density in
determining indoor alloca-
tions, as compared to average
residential density provides a
greater degree of accuracy and
is a more rigorous approach,
but the drawbacks might
include a high cost of admin-
istration. Going a step further,
selecting a higher household
density value as opposed to
a lower value provides for a
more generous budget, which
has the benefit of providing a
more generous allocation (thus
a smaller variance program
and lower cost of implemen-
tation and administration),
at the cost of additional water
savings that could be realized
with a lower allocation.
Meetings: TBD
Deliverables: Presentation
materials in Microsoft
PowerPoint and meeting
minutes for workshops in
Microsoft Word
TASK
Long -Range
Financial Plan
Development
After data has been compiled,
Raftelis will begin development
of a long-range (up to 10 -year)
financial plan for the Water
Enterprise. This will include
an estimate of water revenues
based on current rates, usage
characteristics, and other non-
operating revenues. Raftelis
will analyze these costs and
identify primary cost drivers
of the financial plan as a
percentage of total rates and
charges. Revenue requirements
will be projected based on
calculated water purchase,
treatment, and distribution
costs, current budget, capital
improvement plans (CIP),
existing debt service, other
obligations, and current
economic trends including
inflation. Rates, debt, grants,
government subsidies, or
infrastructure bank loans
will be provided as options
for capital cost financing.
Raftelis will also calculate
increases for third -party costs
such as purchased water and
electricity.
Raftelis will determine the
necessary revenue adjustments
based on the City's capacity
for debt, current revenue and
expenses, and optimal capital
funding mechanisms between
pay -go and debt funded
capital expenses. Projecting
revenue adjustments over a
longer planning horizon can
illustrate future rate impacts
and potential challenges to
the City's financial situation
and allow the City to make
adjustments to expenses,
reserve balances, or capital
projects scheduling to smooth
rate impacts and to maintain
financial stability.
Raftelis will develop a cash
flow analysis to determine
revenue adjustments needed
to meet projected revenue
requirements for the planning
period, white minimizing
sharp rate fluctuations and
debt coverage requirements.
Revenue requirements will be
calculated for each year in the
forecast period and adjusted to
provide for a smooth forecast
of revenue adjustments. For
example, changes in the timing
of capital expenditures and the
use of reserve funds to mitigate
short-term rate impacts are two
ways that revenue smoothing
could be addressed. The
objective will be to minimize
the magnitude of customer
impacts while still achieving
long-term revenue objectives.
At the heart of any successful
financial assessment is the
computer model that is
used to develop revenue
requirements and perform
financial planning. Raftelis
will develop a financial plan
model (FPM) to meet the
City's specific needs and
rising challenges and issues.
Raftelis builds each client's
model from the ground up,
carefully tailored to individual
needs and preferences. Once
completed, the model will
serve as a comprehensive yet
flexible planning tool that
will incorporate the City's
operating budget, forecasted
demand projections, capital
financing plan, revenue
requirements, revenue
projections, reserve balances,
and customer impacts and will
allow for scenario analysis.
The dashboard is the graphical
interface which displays the
model's results in an easily
understandable format. In
Figure 3 on the following page,
the dashboard contains several
features, including the ability
to show or indicate:
• Revenue adjustments
required for the study
period in order to meet debt
coverage and target reserve
balance(s) (blue bars in the
Revenue Adjustments and
Debt Coverage chart)
• Projected operating costs
and revenue streams
(shown in the Water Oper-
ating Financial Plan chart)
• Different funding sources
of CIP: PAYGO or debt
financed (shown in the CIP
and Funding Sources for
Water Funds chart)
• Reserve balances and target
levels according to the
City's policies (shown in the
Projected Ending Fund Bal-
ances) with flagging features
when projected balances fall
below target levels
Upon the completion of the
financial plan model, Raftelis
will hold up to three webinars
with City staff to review the
model and the assumptions
for appropriateness and final-
ize the financial plans for the
Water Enterprise to be used for
the rate design model.
Meetings: Up to three (3)
web -based workshops
with City staff
Deliverable(s):
Presentation material in
Microsoft PowerPoint'" and
draft financial plan model
in Microsoft Excel
TASK 4
Cost of Service
Analysis for Water
Services
Following the development
of the financial plan, Raftelis
will begin to conduct cost of
service (COS) analyses for the
City's water system. The cost
of service analysis portion of
the study is often viewed as a
compliance measure for reg-
ulations such as Proposition
218; another perspective is the
defensibility the analysis pro-
vides the City in terms of the
selected rate structure and rate
levels. This level of confidence
provides additional support to
the City in pursuing the rates
and rate structure that are best
for the City and its customers.
Raftelis will use methodology
set by AWWA's Manual MI
and WEF's Manual of Practice
No. 27. Based on the revenue
requirements identified in Task
2, utility costs will be allocated
to the appropriate service func-
tions, determining how those
services are used by each cus-
tomer class, and calculating the
unit cost for each cost category.
Step 1 — Conduct Usage
Analysis and Determine
Customer Class Usage
Patterns
Raftelis will conduct usage
analysis and determine
whether the tier levels and
number of tiers currently used
by the City are appropriate
based on actual recent cus-
tomer consumption patterns.
Raftelis will then determine
the peaking characteristics for
each customer class or sub-
class. Next, we will estimate
the relative responsibility of
each customer class for each of
the functional cost elements.
This allocation will be based
on billing summary data, other
locally available data that may
46
FIGURE 3
Raftelis will develop customized financial models for
the City that incorporates a dashboard to allowyou to easily
run scenarios and see the impacts in. real time,
Zero Selected Variables Budget CIP(April) Funds 7118713 ®NO Errors
1 F RevAdits co10.0°5 10.0% 10.CrX 10.0% 10,0% 6.5% 6.515 6.iri 6.1' 5.51k_
Drought Cost Revery Fee,s(effective CY) 53,000 .000 51.000,000
Drought Cast Recovery Fees (effective FY) $2,250,000 $1,000,000 -so so 5o $0 $0 5o 5o 50
4 1 0 1 New Fund 711Debt 31r,8fA.0110 59, 300,000 520,zCO3Up: 55. ,v1. C'I'i: -
Adhoc O&M Changes - 713 S0
Water Demand scenados wr„,mn snae;-xs% u.r+1 SX --is
Revad)mts
Revenue Adjustments and Debt Coverage c—raae
12.0%
L
400%
l0.6%% 10.0% 10.0%
10.0% f
10.0°6 10.0::
i 8.0%
300%
6.0%
- 200%
4.0% !.
$7.6 $6.6
2.09C i'
o.Gr:
100%
so
- FY 2014
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
Rev AdJts
.. +Drought Fees ®Debt Coverage —Target Debt Coverage
Water Operating Financial Plan
r. $60
540
----
r
?
---- ---- ----
52o
so
I
-520`
I
FY 2014
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
.SYS O&M Expenses
iDebt Service Capital / Reserve Funding I
_.. Current Rev
–_ Pro
-. e Posed Rev.
be appli-cable, and Raftelis'
experience with other utilities
exhibiting similar usage char-
acteristics and patterns. This
will provide the basis for equi-
table cost allocations to each
customer class or subclass.
Step 2 — Allocate Costs
to Functional Cost
Categories
Raftelis will functionalize
the costs into main functions
such as supply, transmission &
distribution, stor-age, etc. The
costs will then be allocated to
cost categories such as water
supply, water system costs to
meet average demand (or base
costs), extra capacity costs to
meet maximum hour, maxi-
mum day demand, customer
service, meter capacity, etc.
to determine the unit cost for
each cost categories.
Step 3 — Allocate
Functional Costs to
Customer Classes
Next, the costs associated with
the functional components
will be allocated to the various
customer classifications on the
basis of the relative responsi-
bility of each classification for
service provided. Costs will be
allocated based on the deter-
mination of units of service for
each customer classification
and the application of unit
costs of service to the respec-
tive units.
Throughout the cost allo-
cation process, Raftelis will
comply with the City's policy
considerations, procedures,
and guidelines applicable to
charges for water service and
ensure that proposed rates are
in compliance with Proposition
218, Proposition 26, and other
regulations. Although not a law
w $G w w
msmmn no.v.ws n.,mma rm,we.r.
3,078 MG 3,087MG 3,097 MG 3,110 MG 3,123 MG 3,136 MG 3,149h
CtP and Funding Sources for Water Funds
Bud¢etCIP(Aadll
,e $25 r—. _
5111._--.__.—__-____.
520
$15
]
.
510
$7.6 $6.6
3
so
FY 2014 FY 2015
FY 2016 FY 2017 FY 2018 FY 2019
A By Other Agencies
-, By PayGo ■ By New Debt • Total CIP -
Projected Ending Fund Balances
.520
ks �'r $12.7
Oslo -- --- --- -- ---
55
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
Balances -- Target Balances + Alen Balances
firm, Raftelis is very familiar
with Proposition 218 require-
ments and its implications on
utility rates. Our Project Team
has extensive experience with
Proposition 218 and has con-
ducted conference sessions on
the matter.
Meetings: None
Deliverables: Cost of
service analysis in Microsoft
Excel
TASK :>
Water Rates
Development
Task 5.1 — Water Budget
Usage Analysis
If a water budget rate struc-
ture is to be evaluated in
detail (based on the frame-
work agreed on during Task
2), Raftelis will develop the
Water Usage Analysis Module
(shown in Figure 4 on the
following page for illustra-
tive purposes only) to design
appropriate budget -based
tiers. The key variables and
results of the usage analysis
are displayed in Dashboard
format. Raftelis assumes that
City staff will combine the
parcel area data with the City's
current customer usage data
into a single database in order
to efficiently conduct the water
budget analysis.
Allocation Factors for
Water Budget: The model
will provide the ability
to revise different policy
options associated with
defining indoor and out-
door use efficiency such as
landscape area and weather.
In addition, users can easily
adjust variables for house-
hold size and the gallons
used per capita per day.
Tier Definitions: The
model will have the ability
to define appropriate tiers
based on usage types.
Key Results:
a. A. Usage and bill distri-
bution in tiers together
with a water budget
usage histogram result-
ing from the established
water budgets summa-
rize the current water use
efficiency of the agency's
customers. For example,
in Figure 2 item A, 73%
of all customers (44% +
29%) are within tiers I
and 2, which is within
their, total water budget
allotment
B. Peaking characteris-
tics of bi-monthly usage
in each tier represent the
relative contribution to
peaking costs from each
tier. As shown in Figure
2, item B, the peak usage
I r Water Budget (IWBI
Household Size
DIF ,meed, 100%
mpe areo •�r, •rraF •ar ,�,. z!m
n udget Tier Deflnitlons
Tiers Tier Widths
Tier 1 Indoor Use
Tier 2 Outdoor Use
Tier 3 Inefficient Use
Tier 4 Excessive Usela
ro, _tlu8gei I-.) =1W8 • 0—
Current 2 -Tier Definitions
persons/household asx
GPCD i51
DF,,,eea, too',. gallons per capita per day uo%
IWB-Hau+eholE S�ae'uFCD'Dav, ol5ervlce'OF ,�. r08
indoor drought factor 3s%
30%
35%
Outdoor Water Budget �OWB)
Weather Data 10 -yr av
ETAF 30%
consumed in July -August
period is approximately
2.5 times of the usage in
January -February period.
Tier 1 indoor usage is rel-
atively level throughout
the year, whereas Tiers 2
to 4 associated with out-
door usage and inefficient
usage are approximately
five times greater in
July -August than in Jan-
uary -February.
Task 5.2 — Water Rate
Model Development
Rate Calculations
The model determines the
revenues recovered in each tier
and the associated price for
each tier. The model will also
have the flexibility to evaluate
different fixed/variable revenue
structures to enhance revenue
stability. To help communi-
cate with customers about the
drivers and rationale behind
the proposed rates, the water
rates will have several cost
components, including water
supply costs, delivery of the
City's fixed peaking costs, con-
servation costs, and revenue
offsets from other unrestricted
revenue sources to provide
affordability for essential use.
An example of this type of
structuring developed for El
Toro Water District is shown
in Figure 5. Water supply rates
are associated with imported
water costs, and recycled water
program costs are assigned
to Tiers 3 and 4 as the next
marginal water supply source.
The conservation program
is funded through the con-
sumption in higher tiers. This
exercise showing the cost
components for each tier will
be performed regardless of the
rate structure selected.
Multiple -year Rate Projec-
tions and Pass-through Rate
Calculations
The Model user will be able
to enter the estimated/actual
FIGURE 4
Sample Usage Analysis Module
Features denoted are described in the text.
outdoor drought factor
100% of /WB
100% of 0WB
50"1. of TWB
above Tier 3
Baseline Allocation
Current Revised
5/
42 ccf ,..
3/4 in
42 ccf ..
1 in
71 ccf
11/2 in
144 ccf
2 in
290 ccf ... .
zo%
2,000 ccf �,....
g
10 -yr ovg/Actual/Seasonal 15%
6 in
4,000 ccf
ET Adjustment Factor l%ET,1 ?zoss
outdoor drought factor
100% of /WB
100% of 0WB
50"1. of TWB
above Tier 3
47
increases in annual water
purchase costs and the annual
revenue adjustments (deter-
mined using the Long -Range
Financial Plan) for the next
5 years to calculate the pass-
through water supply rates and
ultimately the 5 -year water rate
schedule.
Drought Rate Calculations
Raftelis will develop drought
rates based on the City's
drought stages to offset esti-
mated reductions in revenue
due to drought under the
selected rate option. Raftelis
will discuss with City staff the
policy decisions necessary to
create defensible drought rates.
Raftelis developed the standard
methodology for establishing
drought rates and published
an article in AW WA Journal in
January 2016 titled Developing
Drought Rates: Why Agencies
Should Prepare for a Not -So -
Rainy Day. In June 2016, Mr.
Gaur presented "the Art of Set -
Usage & Bill Distribution a Water Budget Usage Histogram
16% M% 39Y
ssx
zsx
,9%
,' ■� � ox. so%s°%is% i°o% oax ,sox z00% amve
T ap%
Tier) Tier2 TIer3 Teva
aimorn h 6e aax Tw
Bi-tflunthly Usage Distribution 61 fYioa Ully Oiu; wul„zi
& B00 ellne Allocation and Total Water Budget
e on
sm
aoa 6ax sx% ,-
s°% le%
° Ia.n„s s®m N.w« Iao-Fm- w,.ao. Mavam
lulAug Seryotl Nov -Dec -Feb Mar -Apr May-lun --a 69x 92% - 99x 69% lex
36x +i% 63% 9la 96% Glx
Baseline Allocation
Current Revised
5/
42 ccf ,..
3/4 in
42 ccf ..
1 in
71 ccf
11/2 in
144 ccf
2 in
290 ccf ... .
3 in
2,000 ccf �,....
4 in
2,500 ccf ,-
6 in
4,000 ccf
47
increases in annual water
purchase costs and the annual
revenue adjustments (deter-
mined using the Long -Range
Financial Plan) for the next
5 years to calculate the pass-
through water supply rates and
ultimately the 5 -year water rate
schedule.
Drought Rate Calculations
Raftelis will develop drought
rates based on the City's
drought stages to offset esti-
mated reductions in revenue
due to drought under the
selected rate option. Raftelis
will discuss with City staff the
policy decisions necessary to
create defensible drought rates.
Raftelis developed the standard
methodology for establishing
drought rates and published
an article in AW WA Journal in
January 2016 titled Developing
Drought Rates: Why Agencies
Should Prepare for a Not -So -
Rainy Day. In June 2016, Mr.
Gaur presented "the Art of Set -
Usage & Bill Distribution a Water Budget Usage Histogram
16% M% 39Y
ssx
zsx
,9%
,' ■� � ox. so%s°%is% i°o% oax ,sox z00% amve
T ap%
Tier) Tier2 TIer3 Teva
aimorn h 6e aax Tw
Bi-tflunthly Usage Distribution 61 fYioa Ully Oiu; wul„zi
& B00 ellne Allocation and Total Water Budget
e on
sm
aoa 6ax sx% ,-
s°% le%
° Ia.n„s s®m N.w« Iao-Fm- w,.ao. Mavam
lulAug Seryotl Nov -Dec -Feb Mar -Apr May-lun --a 69x 92% - 99x 69% lex
36x +i% 63% 9la 96% Glx
FIGURE 5
Example cost components used to derive total rates in each tier for EI Toro Water District.
CONSERVATIONWATER RATES WATER DELIVERY
($/HCF) SUPPLY (PEAKING) WATER
Tier 1 - Essential Indoor $2.38 $0.15 $0.00 $0.00 -$0.19 $2.34
Tier 2 - Efficient Outdoor
Tier 3 - Inefficient Use
Tier 4 - Excessive Use
Uniform - CII
ting Drought Rates" at the 2016
WESTCAS Annual Conference
in Santa Fe.
Customer Impact Analysis
Customer impact analyses
are also included as standard
features of the Rate Model.
The Impact Analysis charts
are a great tool to measure a
rate structure's effect on cus-
tomer bills and has proven
particularly useful during the
community outreach stage of
an upcoming rate adjustment.
• Sample SFR bill impacts at
various usage levels (Figure
6): A graphical representa-
tion of how the proposed
rate structure will impact
customers' bills. The Model
will have the ability to select
a particular meter size and
see how bills are affected at
different usage levels. This
tool has proven particularly
useful for public outreach
campaigns and during the
Proposition 218 process.
The illustrative chart shown
in Figure 6, prepared for
San Gabriel County Water
District, shows bill impacts
for new rates for a typical
residential customer with
a 5/8 -inch meter at usage
levels ranging from 20 to 50
billing units (1 billing unit =
$2.38
$0.30
$2.38
$0.45
$2.38
$0.60
$2.38
$0.17
100 cubic feet = 748 gallons).
Overall customer impact
(Figure 7): Figure 7 illus-
trates how City customers
will see changes in their
bills if the proposed rate
structure is adopted . For
example, approximately
45% of the customers (32 +
13 percent) will see minor
increases of less than
$5 in their water bills.
Approximately 13% of
the customers will see no
change or some reduc-
tion in the bills. This is an
invaluable tool to facilitate
informed decision making.
The Rate Design Dashboard
(sample Dashboard shown in
Figure 8), which displays key
variables and results in real-
time, will facilitate discussion
to reach a consensus quickly.
To help facilitate informed
decision making, the Model
will also include a summary of
financial impacts on customers
resulting from the proposed
rate structure.
Key Variables
I. Cost allocations to differ-
ent rate components - the
total revenue requirement
is distributed amongst the
various costs such as water
$0.00 $0.00 $0.00 $2.68
$0.35 $1.86 $0.00 $5.04
$0.35 $3.71 $0.00 $7.04
$0.04 $0.19 -$0.15 $2.63
supply, pumping, treat-
ment, etc.
Water Supply Costs infor-
mation for Incremental
/ Marginal Water Supply
Rate Components - the
supply costs for the next
available source of water
supply which is a primary
driver of pricing for higher
tier usage.
Cost recovery in tiers -
how the costs to provide
service are distributing
between tiers.
Results
4. Resulting Proposed Rates
- the proposed rates based
on the parameters set with
the key variables.
i Sample SFR bills impacts
at various usage levels - a
graphical representation
of how the proposed rate
structure will impact
customers' bills. Note the
ability to change the meter
size, lot size, zone and the
billing period for the bill
calculations. This tool
has proven particularly
useful for public outreach
campaigns and during the
Proposition 218 process.
n Overall customer impact
- a summary of how cus-
tomers will see changes in
their bills if the proposed
rate structure is adopted.
This is an invaluable tool to
facilitate informed decision
making.
Task 5.3 - Water
Rate /Buy- in Capital
Connection Survey
Raftelis will compare the City's
current and proposed rates with
up to five neighboring agency
rates. While a useful benchmark,
it is worth noting that such
comparisons only paint a par-
tial picture since many factors,
such as topography and water
sources, affect the total cost of
providing water services. Since
2012, Raftelis conducted a cost
comparison analysis study on an
annual basis for Mesa Consoli-
dated Water District to compare
the system costs for all special
districts within Municipal Water
District of Orange County. Raft-
elis also publishes the nationally
recognized biennial Water and
Wastewater Rate Survey, which
is co -published with the AW WA,
and the California -Nevada
Water and Wastewater Rate
Survey, which is co -published by
the CA -NV AWWA.
Using the rate survey data,
Raftelis will develop an Excel -
based module to compare
FIGURE 6
Sain pie Single -Family
Customer Bilis
Illustrating customer impacts of typical resi-
dential customers at different usage levels.
FIGURE 7
Customer Bili Impact
Illustrating impacts on customers resulting
from the adoption of the proposed rates
49
Sample Bi -Monthly Customer Bills w/ 5/8 inch meter
$160
Sample SFR Bills &Impacts
35%
3No
59,5W
$120
30%
53 DW !
Wr{e+
CMrM CAx{e,
25%
` $80
$ao
i
'004
53.70
20%
-.1
Envey
sUS U.
15% 13%
13%
11% 100
11%
Err,
10%
5%
Bi -Monthly Us ge
20 hcf
25 hcf
30 hcf
40 hcf
50 hcf
0 CY 2015 Bills
$64.21
$73.21
$82.21
$101.31
$120.41
a CY 2016 Bills
$65.01
$72.81
$80.61
$110.41
$140.21
Impact ($)
$0.80
-$0.40
-$1.60
$9.10
$19.80
Impact (%)
1.2%
-0.5%
-1.9%
9.0%
16.4%
%Bills
All Customer Bill Impacts
Sample SFR Bills &Impacts
35%
3No
59,5W
514710.
30%
53 DW !
Wr{e+
CMrM CAx{e,
25%
53.470.383
sa8i 6.559
'004
53.70
20%
-.1
Envey
sUS U.
15% 13%
13%
11% 100
11%
Err,
10%
5%
SP39.351
5233,8.
S3.70
9 o
0%
E C 0,,r 9W f
ever
Sri n¢6Cus[omn snX[e
s15319)2
<_ $0
$0-$3 $3-$5 $5-$10 $10-$20
$20-$50
> $50
Cera rv+0on
$ Change in Bi -Monthly Bills
5 >50
tn.. r5. _
_one3
FIGURE 8
Rate Design Dashboard
1pm,
Sample SFR Bills &Impacts
�,[renl
fnrrenl eP1
59,5W
514710.
514131.0
53 DW !
Wr{e+
CMrM CAx{e,
SY9ter :apply
due
53.470.383
sa8i 6.559
'004
53.70
53653
-.1
Envey
sUS U.
%91119
r. .
3/4 ill
Err,
peeNln{Coca
$ervr[e
SP39.351
5233,8.
S3.70
53652
..
E C 0,,r 9W f
ever
Sri n¢6Cus[omn snX[e
s15319)2
s �9 3 ss90 '
IrN
583.]1
..,.
Cera rv+0on
5331,]36
5 >50
tn.. r5. _
_one3
5053
SO.S3
Tpl+l
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so
the total monthly water bill
amount of a typical residential
customer within each agency.
The adjustable inputs of the
module are water usage and
meter size. The model will
include the appropriate graphs
and figures that display the
total bill of a typical customer
in each agency's service area as
illustrated in Figure 9.
Lastly, Raftelis will prepare a
comparison study of surround-
ing water agencies "buy -in/
capital connection" charges
to evaluate if the City should
consider such charges. As part
of this task, Raftelis will also
provide a benchmark rate com-
parison of the rate analysis in
comparison to other local cities
and water agencies.
Meetings: Up to five (5)
webinars with City Staff to
discuss interim results as
necessary
Deliverables: Water Rate
Model in Microsoft Excel
ASK 6
Water Rate
Workshops
Task 6.1 - Water Rate
Workshops with City
Staff
Following the completion of
the Rate Model, Raftelis will
hold three Workshops with
City staff to develop different
rate scenarios. The goal of
these workshops is to identify
the water rates that will be pre-
sented at the rate workshops
with the City Council. Raft-
elis will present the interim
proposed rates and discuss
the benefits and challenges
associated with each proposed
rate alternative, demonstrated
through the Water Rate Model.
Changes and suggestions from
staff will be incorporated into
FIGURE_ J
Sample Water Rate Sunny Summary of
Residential Water Bills
Residential Water Monthly Bili Comparison for FY 2026
r-
3,aaa
-a
30
a
;,3
L3k0W_W Lor ;:,:ate, avnn4. ro-o-_n. %rglakuaa
the analyses prior to presenting
the results to the Council.
Task 6.2 - Water Rate
Workshops with City
Council / Stakeholders
Upon incorporating City staff
comments from the workshop
in Task 6. 1, Raftelis will present
the results of our Study during
at least one session with the City
Council. The actual number of
workshops will be determined
in Task 1 with City Staff as part
of the 10 public meetings. The
presentation will discuss the
proposed financial plan, and
the proposed rate structure and
rates along with the resulting
customer impact analysis. If
necessary, Raftelis will use the
models to address any concerns
raised regarding the results.
Any changes, comments, and
feedback will then be incorpo-
rated into the final models.
Meetings: Three (3)
Workshops with City staff,
TBD number of meetings
with City Council/
Stakeholder
Deliverables: Presentation
materials for the
Workshops in Microsoft
PowerPoint
Mm
fngejG
TASK 7
Preparation of
Cost of Service
Preliminary Rate
Analysis Report
Raftelis will summarize the pre-
liminary rate analysis results in
the Preliminary Rate Analysis
Report. The Report will high-
light the comprehensive review
of the City's existing rate struc-
ture and the existing financial
condition of the Water Enter-
prise. It will identify the cost
of service gaps or discrepancies
between the existing rate struc-
ture, the projected financial
obligations, and the effects of
drought and associated reduced
water usage demand. As part of
the Report, Raftelis will identify
the strategy intended to resolve
identified concerns and issues.
Meetings: One (1) webinar
with City staff to review
comments on the Draft
Report
Deliverables: COS/Prelim-
inary Rate Analysis Report
in Microsoft Word and pdf
'3Vaca:Lc
!3guna?car 30.1ansmw
'A'a3ar
TASK £t
Administrative
Record Report
Development for
Proposed Water
Rates
The process for developing the
proposed water rates will be
described in a draft water rate
study report. This draft report
will summarize the major
issues and decisions and an
overview of operations, CIP,
the financial plan, and the
final rates resulting from the
Study. The Policy Framework
discussed and agreed to in Task
2 will be included. The report
will also include a section
discussing the gap between
existing rates and the antici-
pated financial obligations for
the Water Enterprise along
with any proposed strategies. A
comprehensive section on the
rate design assumptions and
methodologies used to develop
the user -rate calculations and
financial planning will be
included as part of administra-
tive record for the final rates.
Recent court decisions have
emphasized the importance
of a thorough administrative
record and defensible meth-
odology of the final rates for
service. To ensure that the
Study includes a thorough
administrative record, the
Final Report will include an
exhibit listing all rate design
assumptions and method-
ologies used to develop the
financial plan and rates.
Comments from City staff
will be incorporated into the
Final Report and the Model
will be refined to reflect
appropriate issues or concerns
raised. The Final Report will
be submitted to the City and
will include appropriate sup-
porting data from the Model
to address the requirements
of Proposition 218.
It is imperative that the Report
clearly show the nexus between
the proposed charges for ser-
vice and the cost to provide
said service. The Report will
lead the reader through Raft-
elis' methodology to arrive at
rates that are equitable, reflect
the City's policies and values,
and are driven by the City's
revenue requirements. The
Report's ability to explain the
rate development process in
a clear and understandable
manner will promote financial
transparency, heighten legal
defensibility, and uphold the
City's strong reputation with
the public.
Meetings: One (1) webinar
with City staff and City's
legal counsel to review
comments on the Draft
Report
Deliverables: Draft Report,
Final Report in Microsoft
Word and pdf
TASK 9
Public Meetings to
Present the Final
Recommendations
Raftelis will present the find-
ings and recommendations of
the Study to the City Council at
public meetings. The number
of meetings will be determined
with City staff during kick-off
Workshop in Task 1,
Mr. Gaur, Project Manager,
is consistently called upon by
industry associations such as
AWWA and ACWA to explain
to elected officials the complex
issues associated with design-
ing conservation water rates
and has extensive experience
presenting to utilities' govern-
ing bodies. The presentation
will highlight the collaborative
process used to identify and
prioritize the important issues
facing the City. The proposed
rates will be presented along
with other recommendations
resulting from the Study.
Meetings: TBD
Deliverables: Presentations
for Public Meetings in
Microsoft PowerPoint
TASK 10
Proposition 218
Notice Preparation
and Public Hearing
Task 10.1 - Preparation
for Proposition 218
Notice
Raftelis will assist the City
in preparing the Proposition
218 notice for the City to mail
within the required 45 -day
noticing period prior to hold-
ing the Public Hearing. Raftelis
recognizes the meeting of Prop-
osition 218 requirements as a
legal issue and will work with
the City attorney, as we have
with numerous agencies, to
ensure compliant notification
materials. In addition, Raftelis
will deliver 25 hard copies of the
Final Proposition 218 notice to
City of Newport Beach.
Task 10.2 - Public
Hearing Meeting
As the last step of the Study,
Raftelis will be present at the
Public Hearing to adopt the
recommended rates and will
be available to answer any
questions. Raftelis has assisted
numerous agencies all over
California with the adoption
of conservation rate structures.
Recent examples include the
City of San Juan Capistrano,
Las Virgenes Municipal Water
District, and Elsinore Munici-
pal Water District.
Meetings: One (1) Public
Hearing Meeting
Deliverables: Prop 218
Notice in Pdf and 25 hard
copies and Presentation for
Public Hearing in Microsoft
PowerPoint
TASK i
Simplified Financial
Plan Model with
Adopted Rates
for Future Rate
Updates Evaluation
Upon the completion and
adoption of the new rates,
Raftelis will use the adopted
rates, remove all unnecessary
variables from the Rate Model
and develop a simple, easy to
update Financial Plan Model
for future use by the City's
staff. The simplified Financial
Plan Model will be used to sup-
port annual rate and charges
adjustments upon changes in
water cost, demand, and oper-
ating budgets.
Meetings: One (1) webinar
with City Staff to identify
key features and variables
for the Model
Deliverables: Simplified
Financial Plan Model in
Microsoft Excel
EXHIBIT B
SCHEDULE OF BILLING RATES
Raftelis Financial Consultants, Inc. Page B-1
Costs
Raftelis proposes to complete the scope of work outlined in our proposal on a time -and -materials basis
as shown in the table below. The table provides a breakdown of the estimated level of effort required
for completing each task described and the hourly billing rates for the personnel scheduled to complete
the project. On the following page, we have included a table for the optional tasks along with the hourly
rates. Travel and other expense is estimated to be 6%.
Hours
Web
Number of
Total Fees 8
Tasks
Meetings
Meetings
SG
SGn
HI
KP
Admin
Total
Expenses
1. Kick-off Workshop, Data Collection 8
Project Management
1
10
4
2
10
4
30
$7,272
2. Policy Framework Workshops with City
Council
3
24
12
36
$10,176
3. Long Range Finanical Plan Development
3
12
2
32
46
$11,384
4. Cost of Service for Water Services
2
2
24
28
$6,477
5. Water Rates Development
5
14
4
90
108
$25,429
6. Water Rate Workshops
2
3
27
4
2
30
63
$16,700
7. Preparation of Cost of Service I
Preliminary Rate Analysis Report
2
4
2
20
2
28
$6,981
8. Administrative Report Development for
Proposed Water Rates
2
q
2
40
4
50
$11,003
9. Public Meetings to Present the Final
Recommendations
6
36
2
20
58
$16,218
10. Proposition 218 Notice Preparation and
Public Hearing
1
1
8
4
12
$3,392
11. Simplified Financial Master Model with
Adapted Rates for Future Rate Updates
3
20
23
$5,390
Evaluation
Total Estimated Meetings I Hours
15
14
144
22
4
302
10
482
Hourly Billing Rate
$295
$240
$265
$210
$80
Total Professional Fees
$42,480
$5,280
$1,060
$63,420
$800
$113,040
SG - Sanjay Gaur
Total Fees
$113,040
SGn - Steve Gagnon
HI - Habib Isaac
Total Expenses
-6 %
$6,782
KP - Khanh Phan
-StaffConsultants
Ad
Admin -Administrative Staff
Total Fees
& Expenses
Additional Work Included in Scope
Hours
Total Fees &
Tasks SG SGn HI KP Admin Total Expenses
Section 9 - RW Rate Study 6 2 30 1 39 $9,148
Section 10 - Reserve Policy Review 4 2 20 1 27 $6,296
Section 11 - Water Conservation Ordinance
Update 16 1 17 $4,155
Total Estimated Meetings I Hours 10 20
Hourly Billing Rate $295 $240
Total Professional Fees $2,950 $4,800
SG - Sanjay Gaur
SGn - Steve Gagnon
HI - Habib Isaac
KP - Khanh Phan
SC - Staff Consultants
Admin - Administrative Staff
Raftelis Hourly Rates
0 50 3 83
$265 $210 $80
$0 $10,500 $240 $18,490
Total Fees
Total Expenses - 6%
Total Fees & Expenses
$18,490
$1,109
Total Not -to -Exceed Amount $139,421.00
Hourly Billing
- For services related to the preparation
Position
for and participation in deposition and tri -
Rate"
al/hearing, the standard billing rates listed
Vice President
$295
above will be increased by an amount up
Senior Manager
$265
to 50%.
Manager
$240
Senior Consultant
$210
Consultant
$185
Administration
$75
EXHIBIT C
INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1. Provision of Insurance. Without limiting Consultant's indemnification of City, and
prior to commencement of Work, Consultant shall obtain, provide and maintain at
its own expense during the term of this Agreement, policies of insurance of the
type and amounts described below and in a form satisfactory to City. Consultant
agrees to provide insurance in accordance with requirements set forth here. If
Consultant uses existing coverage to comply and that coverage does not meet
these requirements, Consultant agrees to amend, supplement or endorse the
existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Consultant shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury by
disease in accordance with the laws of the State of California, Section 3700
of the Labor Code.
Consultant shall submit to City, along with the certificate of insurance, a
Waiver of Subrogation endorsement in favor of City, its City Council, boards
and commissions, officers, agents, volunteers and employees.
B. General Liability Insurance. Consultant shall maintain commercial general
liability insurance, and if necessary umbrella liability insurance, with
coverage at least as broad as provided by Insurance Services Office form
CG 00 01, in an amount not less than one million dollars ($1,000,000) per
occurrence, two million dollars ($2,000,000) general aggregate. The policy
shall cover liability arising from premises, operations, personal and
advertising injury, and liability assumed under an insured contract (including
the tort liability of another assumed in a business contract).
C. Automobile Liability Insurance. Consultant shall maintain automobile
insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of Consultant
arising out of or in connection with Work to be performed under this
Agreement, including coverage for any owned, hired, non -owned or rented
vehicles, in an amount not less than one million dollars ($1,000,000)
combined single limit each accident.
Raftelis Financial Consultants, Inc. Page C-1
D. Professional Liability (Errors & Omissions) Insurance. Consultant shall
maintain professional liability insurance that covers the Services to be
performed in connection with this Agreement, in the minimum amount of
one million dollars ($1,000,000) per claim and two million dollars
($2,000,000) in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the Effective Date of this Agreement and
Consultant agrees to maintain continuous coverage through a period no
less than three years after completion of the Services required by this
Agreement.
4. Other Insurance Requirements. The policies are to contain, or be endorsed to
contain, the following provisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation against
City, its City Council, boards and commissions, officers, agents, volunteers
and employees or shall specifically allow Consultant or others providing
insurance evidence in compliance with these requirements to waive their
right of recovery prior to a loss. Consultant hereby waives its own right of
recovery against City, and shall require similar written express waivers from
each of its subconsultants.
B. Additional Insured Status. All liability policies including general liability,
excess liability, pollution liability, and automobile liability, if required, but not
including professional liability, shall provide or be endorsed to provide that
City, its City Council, boards and commissions, officers, agents, volunteers
and employees shall be included as insureds under such policies.
C. Primary and Non Contributory. All liability coverage shall apply on a primary
basis and shall not require contribution from any insurance or self-insurance
maintained by City.
D. Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days' notice of cancellation (except for nonpayment for which ten
(10) calendar days' notice is required) or nonrenewal of coverage for each
required coverage.
5. Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Consultant shall provide certificates of insurance to
City as evidence of the insurance coverage required herein, along with a
waiver of subrogation endorsement for workers' compensation and other
endorsements as specified herein for each coverage. Insurance certificates
and endorsement must be approved by City's Risk Manager prior to
commencement of performance. Current certification of insurance shall be
kept on file with City at all times during the term of this Agreement. City
reserves the right to require complete, certified copies of all required
insurance policies, at any time.
Raftelis Financial Consultants, Inc. Page C-2
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Consultant sixty (60) calendar days' advance
written notice of such change. If such change results in substantial
additional cost to Consultant, City and Consultant may renegotiate
Consultant's compensation.
C. Enforcement of Agreement Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of City to inform
Consultant of non-compliance with any requirement imposes no additional
obligations on City nor does it waive any rights hereunder.
D. Requirements not Limiting. Requirements of specific coverage features or
limits contained in this Section are not intended as a limitation on coverage,
limits or other requirements, or a waiver of any coverage normally provided
by any insurance. Specific reference to a given coverage feature is for
purposes of clarification only as it pertains to a given issue and is not
intended by any party or insured to be all inclusive, or to the exclusion of
other coverage, or a waiver of any type. If the Consultant maintains higher
limits than the minimums shown above, the City requires and shall be
entitled to coverage for higher limits maintained by the Consultant. Any
available insurance proceeds in excess of the specified minimum limits of
insurance and coverage shall be available to the City.
E. Self-insured Retentions. Any self-insured retentions must be declared to
and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-
insurance will not be considered to comply with these requirements unless
approved by City.
F. City Remedies for Non -Compliance. If Consultant or any subconsultant fails
to provide and maintain insurance as required herein, then City shall have
the right but not the obligation, to purchase such insurance, to terminate this
Agreement, or to suspend Consultant's right to proceed until proper
evidence of insurance is provided. Any amounts paid by City shall, at City's
sole option, be deducted from amounts payable to Consultant or reimbursed
by Consultant upon demand.
G. Timely Notice of Claims. Consultant shall give City prompt and timely notice
of claims made or suits instituted that arise out of or result from Consultant's
performance under this Agreement, and that involve or may involve
coverage under any of the required liability policies. City assumes no
obligation or liability by such notice, but has the right (but not the duty) to
monitor the handling of any such claim or claims if they are likely to involve
City.
H. Consultant's Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
judgment may be necessary for its proper protection and prosecution of the
Work.
Raftelis Financial Consultants, Inc. Page C-3
CERTIFICATE OF INSURANCE
CHECKLIST
City of Newport Beach
This checklist is comprised of requirements as outlined by the City of Newport Beach. *
Date Received: 3/4/19
Dept./Contact Received From:
Date Completed: 3/4/19 Sent to:
Company/Person required to have certificate:
Type of contract:
Joan
Joan By: Jan
Raftelis Financial Consultants, Inc.
Other
I. GENERAL LIABILITY
EFFECTIVE/EXPIRATION DATE: 1/21/19 — 1/21/20
A. INSURANCE COMPANY: National Fire Insurance Company of Hartford
B. AM BEST RATING (A-: VII or greater): A / XV
C. ADMITTED Company (Must be California Admitted):
Is Company admitted in California?
® Yes ❑ No
D. LIMITS (Must be $1 M or greater): What is limit provided?
$1M/$2M
E. ADDITIONAL INSURED ENDORSEMENT — please attach
® Yes ❑ No
F. PRODUCTS AND COMPLETED OPERATIONS (Must
INSURANCE COMPANY: National Fire Insurance Company of Hartford
include): Is it included? (completed Operations status does
not apply to Waste Haulers or Recreation)
❑ Yes ❑ No
G. ADDITIONAL INSURED FOR PRODUCTS AND
COMPLETED OPERATIONS ENDORSEMENT (completed
C.
Operations status does not apply to Waste Haulers)
❑ Yes ❑ No
H. ADDITIONAL INSURED WORDING TO INCLUDE (The City
its officers, officials, employees and volunteers): Is it
Is Company admitted in California?
included?
® Yes ❑ No
I. PRIMARY & NON-CONTRIBUTORY WORDING (Must be
D.
included): Is it included?
® Yes ❑ No
J. CAUTION! (Confirm that loss or liability of the named insured
is not limited solely by their negligence) Does endorsement
UM, $2M min for Waste Haulers): What is limits provided?
include "solely by negligence" wording?
❑ Yes ® No
K. ELECTED SCMAF COVERAGE (RECREATION ONLY):
® N/A ❑ Yes ❑ No
L. NOTICE OF CANCELLATION:
❑ N/A ® Yes ❑ No
II. AUTOMOBILE LIABILITY
EFFECTIVE/EXPIRATION DATE: 1/21/19 — 1/21/20
A.
INSURANCE COMPANY: National Fire Insurance Company of Hartford
B.
AM BEST RATING (A- : VII or greater) A / XV
C.
ADMITTED COMPANY (Must be California Admitted):
Is Company admitted in California?
® Yes
❑ No
D.
LIMITS - If Employees (Must be $1 M min. BI & PD and $500,000
UM, $2M min for Waste Haulers): What is limits provided?
$1,000,000
E
LIMITS Waiver of Auto Insurance / Proof of coverage (if individual)
(What is limits provided?)
N/A
F.
ADDITIONAL INSURED WORDING:
❑ N/A
® Yes
❑ No
G.
PRIMARY & NON-CONTRIBUTORY WORDING:
❑ N/A
® Yes
❑ No
H.
HIRED AND NON -OWNED AUTO ONLY:
❑ N/A
® Yes
❑ No
I.
NOTICE OF CANCELLATION:
❑ N/A
® Yes
❑ No
WORKERS' COMPENSATION
EFFECTIVE/EXPIRATION DATE: 1/21/19 —1/21/20
A. INSURANCE COMPANY: Continental Insurance Company
B. AM BEST RATING (A-: VII or greater): A / XV
C. ADMITTED Company (Must be California Admitted):
D. WORKERS' COMPENSATION LIMIT: Statutory
E. EMPLOYERS' LIABILITY LIMIT (Must be $1 M or greater)
F. WAIVER OF SUBROGATION (To include): Is it included?
G. SIGNED WORKERS' COMPENSATION EXEMPTION FORM
H. NOTICE OF CANCELLATION:
® Yes ❑ No
® Yes ❑ No
$1,000,000
® Yes ❑ No
® N/A ❑ Yes ❑ No
❑ N/A ® Yes ❑ No
ADDITIONAL COVERAGE'S THAT MAYBE REQUIRED
IV. PROFESSIONAL LIABILITY 1/21/19 —1/21/20 CONTINENTAL INSURANCE COMPANY
Rated: A/XV, Admitted Limits: $5M ❑ N/A ® Yes ❑ No
V POLLUTION LIABILITY
VI BUILDERS RISK
HAVE ALL ABOVE REQUIREMENTS BEEN MET?
IF NO, WHICH ITEMS NEED TO BE COMPLETED?
® N/A ❑ Yes ❑ No
® N/A ❑ Yes ❑ No
® Yes ❑ No
Agent of Alliant Insurance Services Date
Broker of record for the City of Newport Beach
RISK MANAGEMENT APPROVAL REQUIRED (Non -admitted carrier rated less than
Self Insured Retention or Deductible greater than $ ) ❑ N/A ❑ Yes ❑ No
Reason for Risk Management approval/exception/waiver:
Approved:
Risk Management Date
* Subject to the terms of the contract.