HF&H CONSULTANTS, LLC -2011 - Laserfiche WebLink

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HFBzH CONSULTANTS, LLC Managing Tomorrow's Resources Today 201 North Civic Drive, Suite 230 Walnut Creek, California 94596 Tel: (925)977-6950 Fax: (925)977-6955 hfh-consultants.com November 11, 2011 Mr. Francisco Gutierrez Executive Director of Finance City of Santa Ana 613 E. Broadway, Suite 220 Glendale, CA 91206 Sent via email Subject: Proposal: Review Transfers From the Water Enterprise Dear Mr. Gutierrez: Robert D. Hilton, CMC John W. Farnkopf, PE Laith B. Ezzet, CMC Richard J. Simonson, CMC Marva M. Sheehan, CPA On behalf of HFBsH Consultants, LLC, I am pleased to submit this proposal to conduct a review of the transfers from the Water Enterprise for related services. This proposal describes the project background, our proposed methodology and approach, our qualifications, staffing, and the schedule and budget. I. Background The City has transferred funds from the Water Enterprise to the General Fund that are identified in the budget as "Cross Charges". In particular, within the Miscellaneous Operating Expenses are payments that are described as "in lieu of property taxes, franchise fees, and a return to investors." These payments amount to almost $9 million of the $12.5 million shown being transferred from the Water Enterprise to the General Fund in Figure 1 below. Figure 1 also shows the transfer from the Water Enterprise to the Internal Services Fund. Other transfers are also shown among the other funds within Public Works Administration (PWA). In addition, there is a utility users tax that is assessed to the Water Enterprise. The City was advised by its budget stabilization consultants to review the basis for the Water Enterprise transfers to provide a cost justification. The City's current practice, which is not thoroughly documented, should be updated to address recent legislation,