HomeMy WebLinkAboutIR 9558 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9558
To the Mayor and Members of the City Council May 14, 2013
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SUBJECT: UPDATE ON WATER UTILITY TASK FORCE
On March 5, 2013, the Fort Worth City Council adopted resolution NO. 4185-03-2013 appointing
a water utility task force to advise the city council about the city's options for public / private
partnerships to deliver water and wastewater service. The resolution requests that the nine
member Task Force determine the feasibility and desirability of pursuing public / private
partnerships that may result in lower costs for utility customers and that may add value for City
ratepayers and municipal government; identify alternatives for the management and operation of
the City's water and wastewater systems; assess the legal and fiscal implications of public /
private partnerships; and provide the City Council with appropriate recommendations.
The first workshop was held on April 3, 2013 and facilitated by the consulting firm EMA, Inc. After
a call to order and introductions the Mayor charged the Task Force with their responsibilities and
expectations. The Task Force members were guided by Water Department staff through a
detailed presentation informing them of utility operations, finances and utility performance. EMA
staff explained the characteristics and scale of public/ private partnerships and provided several
case studies of utilities that have, or are in the process of some element of privatization.
The elements of a "Request For Information" (RFI) were reviewed in detail during the first
workshop. The purpose of the RFI is to get the Task Force the information it needs to make a
recommendation to City Council. The RFI will include the City's objectives in considering a public
/ private partnership, a utility budget summary and general definitions of business models to be
considered. A water departmental overview will be provided with divisional summaries and a
breakdown of operating costs. The RFI will provide a base line level of service that the Water
Department provides the citizens of Fort Worth and the level of capital needed to sustain that
level of service. The RFI will ask for the private sector to come up with steps that may be taken
to reduce costs of maintenance and operations while achieving or exceeding current levels of
service and how those savings translate to lower rates for utility customers while maintaining or
improving the general state of municipal finance.
The second Task Force workshop was held on May 8, 2013. Members were provided additional
details of utility operations, expenditures and performance measures versus industry standards
and peer benchmarking. EMA consulting provided the Task Force an update of the Allentown,
PA lease concession case study with details of the final agreement which ended up being a
Public/ Public Partnership with the Lehigh County Water Authority. EMA also reviewed the RFI
outline & structure and lead the members through a discussion of the five various business
models to possibly be considered in the RFI process. The five models are:
1. Complete Sale of Assets
2. Lease Concession of Assets
3. Contract Operations & Maintenance (Enterprise)
4. Strategic Outsourcing (Specific Services)
5. New Revenue Stream or Business
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9558
To the Mayor and Members of the City Council May 14, 2013
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SUBJECT: UPDATE ON WATER UTILITY TASK FORCE
After lengthy discussion the Task Force made the decision to pursue all business models with the
exception of the complete sale of water utility assets. The RFI is expected to be advertised in late
May with vendor submittal due in late July or early August.
The third workshop is scheduled for May 20, 2013 where the RFI will be finalized and firm dates
set for advertising, submittal and evaluation. Recommendations to Council are on schedule for
October, 2013.
Should you have any additional questions, please contact Frank Crumb, Water Director
at 817-392-8207
Tom Higgins
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS