ADMINISTRATIVE COMMITTEE
5.	CONSIDER RECOMMENDING AUTHORIZATION OF EXPENDITURE OF FUNDS NOT TO EXCEED $230,000 FOR ADDITIONAL APPRAISAL AND COST OF SERVICE ANALYSIS BY RAFTELIS RELATED TO THE ACQUISITION OF THE MONTEREY WATER SYSTEM (MEASURE J)
Meeting Date:		September 13, 2021	Budgeted:	No
From:		David J. Stoldt,	Program/	Services & Supplies
		General Manager	Line Item No.:	Professional Fees
Prepared By:		David J. Stoldt	Cost Estimate:	$230,000
General Counsel Review: N/A
Committee Recommendation: The Administrative Committee reviewed this item on September 13, 2021 and recommended ____________________.
CEQA Compliance: This action does not constitute a project as defined by the California Environmental Quality Act Guidelines Section 15378.

SUMMARY: Raftelis has been the District’s financial consultant working on the acquisition of the California American Water Company (Cal-Am) Monterey Water System since January 2019. In November 2019 the firm completed the Preliminary Valuation and Cost of Service Analysis Report determining that an acquisition of the System is financially feasible. Raftelis provided additional work on rate impacts and formal appraisal work that was ready to go in October 2020. Unfortunately, delays in the LAFCO process have resulted the appraisal work becoming “stale” and in need of updating. Additional cost of service analysis and rate impact analysis will likely also be needed to inform the District Board’s decision to move forward. There is $14,440 remaining in their budget and July and August invoices have not been reflected.

Raftelis scope of services (redacted) is attached as Exhibit 5-A. The proposed budget is just under $230,000.

RECOMMENDATION: The Administrative Committee should recommend that the Board authorize expenditure of funds not to exceed $230,000 for additional appraisal and cost of service analysis by Raftelis related to the acquisition of the Monterey Water System (Measure J).

IMPACT TO DISTRICT RESOURCES: Such Measure J related expenses have not been budgeted and will come from District reserves.

EXHIBIT

5-A Raftelis Proposed Scope of Services and Budget

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