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File #: 18-049    Version: 1
Type: Award of bid, rfp, etc. Status: Passed
File created: 1/16/2018 In control: City Council
On agenda: 2/20/2018 Final action: 2/20/2018
Title: Waive the applicable provisions of the Naperville Procurement Code and award Procurement 18-060, 2018 Comprehensive Electric Utility Cost-of-Service Rate Study, to Utility Financial Solutions, LLC for an amount not to exceed $52,000.
Attachments: 1. 15-177 Awards
CITY COUNCIL AGENDA ITEM

ACTION REQUESTED:
title
Waive the applicable provisions of the Naperville Procurement Code and award Procurement 18-060, 2018 Comprehensive Electric Utility Cost-of-Service Rate Study, to Utility Financial Solutions, LLC for an amount not to exceed $52,000.
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DEPARTMENT: Electric Utility

SUBMITTED BY: Mark Curran, Director

BOARD/COMMISSION REVIEW:
PUAB concurred with staff's recommendation to waive the applicable provisions and proceed with a recommendation to City Council to award the 2018 Comprehensive Electric Utility Cost-of-Service Rate Study to Utility Financial Solutions.

BACKGROUND:
In 2015, the City contracted with Utility Financial Solutions (UFS) to perform a rate study. The study was a guide for the City in making appropriate financial decisions for the Electric Utility through 2018. UFS completed the rate study with the following financial goals:
? Restore the "capital" maintenance program to an appropriate level;
? Repay the $13.2 million loan to the Water Utility; and
? Restore cash reserves to an appropriate level.

The developed rate design was approved by City Council on January 5, 2016 and was based on the following items:

1. Implement a phased approached to a "Capital" Maintenance Budget ($8.3 million, $8.3 million, $10 million) over the next three years;
2. Implement a Purchased Power Adjustment (PPA) - A PPA is an adjustment made on an electric bill that is designed to recoup or credit the difference in costs associated with power purchases to help ensure customers are not over or under charged for power supply. This tool is used by approximately 75% of public power systems and all investor-owned utilities to address variability in the power market;
3. Complete a rate design that incorporates rate increases of 8.3% for all customer classes in 2016, from 0.4-4.4% in 2017 and 2018 depending on customer class and no issuance of debt. This option provides revenue for the repayment of the Water l...

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