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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />FEBRUARY 5, 2019 <br />TITLE: <br />APPROVE AN AMENDMENT TO THE <br />AGREEMENT WITH STANTEC TO <br />INCLUDE A CAPITAL FACILITY CHARGE <br />STUDY FOR THE WATER AND SEWER <br />ENTERPRISES (NONGENERAL FUND) <br />(STRATEGIC PLAN NO. 6, 1H) <br />CITY MANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 151 Reading <br />❑ Ordinance on 2°d Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />Authorize the City Manager and Clerk of the Council to amend the agreement with Stantec to <br />conduct a water and sewer enterprise capital facility charge study by increasing the <br />compensation by an amount not to exceed $27,000, for a total agreement amount not to exceed <br />$185,000, subject to nonsubstantive changes approved by the City Manager and City Attorney. <br />On July 3, 2018, at the conclusion of a competitive bid process, the City entered into an <br />agreement with Stantec to perform a cost of service study for the water and sewer enterprises. <br />The primary tasks of the agreement are to create a financial plan for each enterprise, perform a <br />cost -of -service analysis, and provide a recommended five-year rate structure for Council <br />consideration. <br />Throughout the course of the study, it has been identified that there is a need to develop and <br />update Capital Facility Charges, otherwise known as Connection Fees, for the water and sewer <br />enterprises, respectively. These types of charges are fees imposed by public utilities on new <br />developments wishing to connect to the existing public water or sewer system, or on existing <br />users that wish to upsize their current connection or increase the capacity by a change in their <br />operation. The revenue collected from these charges are restricted and may only be used to <br />construct new infrastructure, construct infrastructure capacity enhancements, reimburse the utility <br />for past expansion projects, or for acquiring access to new water supplies. <br />Staff recommends that the existing agreement with Stantec be amended to expand their scope of <br />work to include a Capital Facility Charges study. Stantec will be able to provide this service on a <br />cost-effective and expedient time frame due to work already performed for the cost -of -services <br />studies (Exhibit 1 - Amendment). <br />25A-1 <br />