HomeMy WebLinkAbout03.b. Raftelis Financial Consultants, Inc.Page 1 of 5
Item 3.b.
MEETING DATE:
SUBJECT
BOARD OF DIRECTORS
POSITION PAPER
J ULY 23, 2024
REVIEW DRAFT POSITION PAPER TO AUTHORIZE THE GENERAL
MANAGER TO EXECUTE AN AS -NEEDED PROFESSIONAL SERVICES
AGREEMENT WITH RAFTELIS FINANCIAL CONSULTANTS, INC.
(RAFTELIS) FORA FIVE-YEAR TERM I N AN AMOUNT NOT TO EXCEED
$300,000
SUBMITTED BY: INITIATING DEPARTMENT:
GEOFF MICHALCZYK, MANAGEMENT ENGINEERING AND TECHNICAL SERVICES -
ANALYST PDS-RATES AND FEES
THOMAS BRIGHTBILL, SENIOR ENGINEER
REVIEWED BY: DANEA GEMMELL, PLANNING AND DEVELOPMENT SERVICES DIVISION
MANAGER
GREG NORBY, DEPUTY GM - ENGINEERING & OPERATIONS
ROGER S. BAILEY, GENERAL MANAGER
ISSUE
The Board of Directors' (Board) authorization is required for the General Manager to execute agreements
in amounts greater than $200,000.
BACKGROUND
Raftelis has been providing financial consulting services to Central San since 2014. Raftelis has helped
Central San develop long-term rate models, perform cost -of -service analyses, and provide Proposition
218 support. Most recently, Raftelis was the lead consultant for updating Central San's annual sewer
service charges for a two-year period beginning in FY 2023-24. Central San's current contract with Raftelis
expires on September 30, 2024. An updated agreement is required to retain Raftelis' services as Central
San prepares for significant financial planning events such as the following:
1. Board Financial Planning Workshops scheduled for Fall 2024.
2. Updated cost -of -service analysis and annual sewer service charge rate setting for FY 2024-25 and
future years.
3. Ongoing support for financial impacts of nutrient removal projects.
4. Develop financial pro formas and assist as -needed for anticipated debt issuances.
July 23, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 77 of 90
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This consulting work requires extensive and in-depth knowledge of Central San's rates, finances, financial
constraints, financial and working relationships such as our agreement with the City of Concord, and
Central San's pricing and other considerations related to recycled water. Raftelis staff is intimately familiar
with such considerations. Retaining a new consultant and providing them with the background materials and
training to achieve a similar level of familiarity would jeopardize our ability to meet deadlines associated
with the financial planning events described above.
As -needed agreements allow Central San staff to expedite and assign work to pre -qualified firms in an
efficient and responsive manner through the issuance of a task order which defines their respective scope
of work, project cost, and delivery schedule. Task orders are negotiated, reviewed and approved by the
Division Manager, released, and tracked following a similar task order release process that has also been
used successfully for both planning and capital project as -needed blanket purchase agreements.
ALTERNATIVES/CONSIDERATIONS
1. Obtain proposals from other financial consultants as part of a competitive bid process. This alternative
would require Central San to issue a request for proposals via PlanetBids and the Central San website.
Qualified firms will be evaluated based on experience, availability, costs, and references. This alternative
is not recommended because the process would jeopardize our ability to meet deadlines associated with
the Board Financial Planning Workshops this Fall and the Proposition 218 notification deadlines for rate
adoption for FY 2024-25.
2. Do not approve the agreement. This alternative would be for the Board to direct staff not to execute the
agreement as proposed. It would require the Board to recommend alternative terms such as a shorter
agreement duration.
FINANCIAL IMPACTS
The services provided are paid for and included in the Board -approved Budget. No additional funding for
these as -needed agreements is required.
This selection process and award of an agreement provides a go -to firm when support is required. This
allows Central San staff to expedite the process of completing work and addressing tasks as needed, and
to respond to needs in an efficient manner. Ongoing and additional specialty support needs are anticipated
to address upcoming projects and tasks.
COMMITTEE RECOMMENDATION
The Finance Committee reviewed this matter at its meeting on July 23, 2024 and recommended
RECOMMENDED BOARD ACTION
Authorize the General Manager to execute an as -needed Professional Services Agreement with Raftelis
Financial Consultants, Inc. for a five-year term in an amount not to exceed $300,000.
Strategic Plan Tie -In
GOAL FOUR: Governance and Fiscal Responsibility
Strategy 3 - Maintain financial stability and sustainability
GOAL SIX: Infrastructure Reliability
Strategy 2 - Execute long-term capital renewal and replacement program
July 23, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 78 of 90
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ATTACHMENTS:
1. Proposed Raftelis Scope and Fees
July 23, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 79 of 90
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150 N Santa Anita Av. Phone 626 . 583 . 1894 www.raftelis.com
Arcadia, CA91006 Fax 213 262 .9303
RAFTELIS
June 17, 2024
Central Contra Costa Sanitary District
5019 Imhoff Place
Martinez, CA 94553
Subject: Proposal for On -call Financial Services
Dear Ms. Gemmell:
Raftelis Financial Consultants, Inc. (RFC) is pleased to present this proposal for on -call financial services
for five years to the Central Contra Costa Sanitary District (District).
SCOPE
Raftelis has been assisting the District update its wastewater rates and providing other financial service
to the District for a number of years. The District would like to enter into a five-year contract for financial
on -call services with Raftelis. Raftelis will provide these services as requested by the District in a timely
manner and may involve developing models to review various scenarios and the impacts on customers.
These services will be provided on a time and materials basis. The five-year budget for these services is
estimated to be $300,000. Raftelis will inform the District if the annual cost exceeds $50,000 in any given
year.
The hourly rates for CY 2024 are shown below; invoices will be based on the hourly rates in effect in any
given year.
Position
Hourly Rate
Executive Vice President
$400
Vice President
$360
Senior Manager
$320
Manager
$285
Senior Consultant
$250
Consultant
$220
Associate Consultant
$185
Administration
$100
Technology/Communications Charge"
$10
July 23, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 80 of 90
Central Contra Costa Sanitary District
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June 17, 2024
Page 2
We appreciate the opportunity to assist you with this study. This letter may be used to form an
agreement by affixing your signature and returning a copy for our files. Please call me at
626 827 8931 if you have any questions.
RAFTELIS FINANCIAL CONSULTANTS, INC. Santa
<ZE:�
By:
Sudhir Pardiwala
Exec Vice President
By:
Title:
Date:
July 23, 2024 Regular FINANCE Committee Meeting Agenda Packet - Page 81 of 90