HomeMy WebLinkAboutContract 30980STATE OF TEXAS §
COUNTY OF TEXAS § CITY SECRETARY CONTRACT NO.��
WHEREAS, the City of Fort Worth ("City") and Black & Veatch Corporation
("Consultant") made and entered into City of Fort Worth City Secretary Contract No. 3011 l, (the
"Contract") which was authorized by the City Council by M&C C-20107 on June 8, 2004; and
WHEREAS, the Contract involves professional services related to the development of
rates for wholesale wastewater customers of the City; and
WHEREAS, it has become necessary to amend the Contract to include an increased scope
of work and/or revised maximum fee.
NOW, THEREFORE, City and Consultant, acting herein by and through their duly
authorized representatives, enter into the following agreement that amends the contract:
1.
Section 2, Scope of Services, of the Contract is amended to include the additional
consultant services described in Consultant's proposal letter of September 23, 2004 and the
attachments thereto, copies of which are both attached hereto and incorporated herein. The cost
for these additional services to be performed by Consultant shall not exceed $24,800, provided
that Consultant has the ability to utilize the City's current Retail Cost of Service computer
models cost shall not exceed $24,800. If Consultant is unable to utilize these models, Consultant
and City will negotiate an additional amendment to the Contract if the cost of the additional
services will exceed $24,800, or this amendment will terminate at such time as Consultant has
expended the additional fee.
2.
Section 4, Compensation to the Consultant and Method of Payment, of the Contract is
amended to provide for an increase in the not-to-exceed fee to be paid to Consultant for all work
and services under the Contract, as amended, so that the not-to-exceed fee to be paid by City for
all work and services is $120,350.
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�RIGINAL
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Based on the fact that the City has authorized Consultant to utilize its current Retail Cost
of Service computer models, City acknowledges that the outcomes produced by Consultant will
be a result of the information contained in these models. Therefore, Consultant shall not be
responsible or liable for any information produced for this amendment that is later determined to
be a result of incorrect data generated by these models, including, but not limited to, situations
where these models do not contain up to date information.
4.
All other provisions of the Contract that are not expressly amended herein shall remain in
full force and effect.
Executed on this the� day of�6e� r, 04.
APPROVAL RECOMMENDED:
Fort Worth Water Department
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vFrank Crumb, P. E.
Acting Director
ATTEST:
Marty Hendrix
City Secretary
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ATTEST: e._�-.�.._�. --�--,
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Corporate Secretary
BLACK & VEATCH
OUTSIDE CITY RATE STUDY AMENDMENT
Page 2 of 2
CITY OF FORT WORTH
By: , /
Marc O� t
Assistant City Manager
Approved as to Form and Legality
Assistant Ci Attorney
Black & Veatch Corporation
By: c�-
William C. Cole
Vice President
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B��I� F� VE�4T�H
9441 LBJ Freeway, Suite 300
Dallas, TX 75243 USA
Tel: (214) 570-7033
Fax: (214) 570-7049
September 23, 2004
City of Fort Worth
Water Department Administration
Kara L. Shuror
Senior Administrative Services Manager
1000 Throckmorton Street
Fort Worth, Texas 76102
Subj ect: Contract Amendment
Dear Ms. Shuror:
Black & Veatch International Company
This letter requests an amendment to contract CSC No. 30111 between the City of Fort
Worth (the "City") and Black and Veatch Corporation (the "Consultant"). Attached is
the proposed scope of services and fee estimate for assistance in developing a rate for
customers outside the City limits. The cost of the amendment will not exceed $24,800 for
a total not to exceed amount of $120,350 for CSC No. 30111.
The purpose of this amendment is to provide assistance to the City in the determination
of an Outside City retail rate differential. Again, a further detailed scope of services to be
rendered by the Consultant is attached. The contract amendment price of $ 24,800 is
based upon the Consultants ability to obtain and make use of the City's current retail cost
of service computer models:
All other issues/conflicts shall be handled as addressed in the original contract CSC No.
30111. Should there be any questions concerning this amendment, please don't hesitate
to contact me.
Sincerely,
Richard L. Campbell
Senior Consultant
Black & Veatch Corporation
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Black & Veatch
August 2004
Fort Worth Water Department
City of Fort Worth, Texas
Proposed Scope of Work and Fee Estimate
For Assistance with Determination of Outside City Retail Rate
Differential
It is our understanding that the Fort Worth Water Department would like to make a
determination of what an appropriate and supportable rate differential would be between
inside City retail (owner customers) rates and outside City retail rates. Black & Veatch
proposes to utilize Fort Worth's existing computer rate models in this effort to be as
efiicient as possible. It is presumed that these models have been recent�y updated with all
necessary information for determining water and wastewater retail rates, wholesale water
rates, and wholesale wastewater rates for the test years 2004-05.
Scoue of Work
Black & Veatch proposes to conduct the following scope of work in the determination of
a supportable outside City rate differential.
1.0 Review Current Rate Models
We will obtain and review the Department's water and wastewater cost of service/rate
models that have recently been updated by Water Department staff for determining recent
rates for water/wastewater retail, wholesale water, and wholesale wastewater purposes.
For clarification, these three models were used for deriving the rates prepared for
implementation in fiscal year (FY) 2005. Upon receipt of the models, we will evaluate
the retail rate model for its usefulness and identify where any modifications will need to
be made to convert it to a"utility basis" of cost determination. Concurrently, the
Department's wholesale water and wholesale wastewater rate models will be evaluated
for the purpose of identifying selected "utility basis" cost allocation tabulations to
incorporate into the retail rate model for deternuning outside City retail cost of
service/rates.
Where questions of interpretation are required in the evaluation of the models, it is
expected that Department representatives will be available and respond to any
explanations that might need to be given.
2.0 Modify Current Models to Reflect New Service to Outside City Customers
We will modify the Department's current retail rate model to convert it from a"cash
basis" to a"utility basis" of cost of service determination. Following accepted industry
rate methodologies, a utility basis of cost of service determination will be used for -,_ -
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determining outside City rates that recover the costs for operation & maintenance
expense, depreciation expense, return on rate base, and street rentaL Where necessary
and appropriate and to the greatest extent practical, the utility basis cost allocations for
depreciation and rate base will be used from the Deparhnent's wholesale models and
incorporated into the modified retail model. A rate of return equal to or slightly greater
than that allowed for in the Department's wholesale contracts will be used.
The new modified model will be updated to reflect the addition of a new retail class of
customer for outside City service. The estimated number of customers by meter size and
water/wastewater sales volumes will be provided by Department staff together with any
information that may be available on their class maximum day/hour water demands and
contributed wastewater strengths.
The cost to provide service to outside City retail customers (non-owners) will be
determined through an allocation of functionalized costs to the outside City retail class
based upon their presumed use of the City's water and wastewater systems.
The cost results from the modified "utility basis" cost of service determination for outside
City retail customers will be equated to an average unit cost per thousand gallons of
annual water consumption / wastewater contribution compared to a similar unit cost for
inside City retail service for determining what a supportable rate differential would be.
3.0 Meetings and Presentations
We will meet with Fort Worth Water Department representatives twice during the course
of this study to explain the rate determination process and to consider any options that
may need to be further investigated. Black & Veatch will be available to participate in
additional meetings such as with outside City representatives at an additional cost to be
determined and agreed upon between the Deparhnent and Consultant.
4.0 Executive Summary Report
We will prepare an executive summary report delineating all assumptions and
methodologies used in the determination of the outside City rate differential including
findings which may be used to support higher rates to non-owner customers. A draft of
the report will be furnished to the Department for review. Following the receipt of any
comments, a final report will be prepared and ten (10) copies provided to the Department.
Proposed Fee
It is estimated that our proposed fee for the above specified services would be $24,800.
The estimate includes all labor and expenses at our out-of-pocket costs. For contract
purposes, we propose a cost plus with maximum fee limit type of agreement for the
services described above. Fort Worth would be billed for time expended on the project at
our hourly billing rates plus direct expenses at our out-of-pocket cost. Invoices would be
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issued monthly with payment due within 30 days. Our cost estimate is broken-down
according to the following task assigrunents:
Task
1.0 Model review/verification
2.0 Modify model for OCL rates
3.0 Meetings
4.0 Summary Report
Total Labor Effort (hours)
Billing Rate ($/hr.)
Total Labor Cost
Direct Expenses to include
technology chaxge
Total Fee Estimate
Senior
Consultant
hours
8
44
12
8
72
$175
$12,600
3
Associate
Consultant
hours
12
68
8
12
100
$100
$10,000
Total
$22,600
2 200
$24,800
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