Following completion of over half of the required $1+ billion in capital improvements related to a Federal consent order, Raftelis was engaged by the City of Akron (City) to perform a comprehensive cost-of-service, rate design, and financial planning study for the City’s wastewater utility in 2019. As part of this engagement, Raftelis developed a comprehensive financial planning model that assessed the current financial condition of the utility and developed a plan for sustainably financing the remaining capital projects.
This engagement included an evaluation of the feasibility of implementing a summer sprinkling program for residential customers. Raftelis analyzed detailed customer billing records to explore water consumption patterns and ultimately determined that there would be minimal customers who substantially benefit from a summer sprinkling program. Raftelis also developed an assessment of the feasibility to implement a wet weather fee based on local impervious area that could help promote equity in revenue recovery. Additionally, Raftelis performed an evaluation on the City’s existing customer assistance program options and level of relief offered to customers.
In 2021, Raftelis was engaged to prepare an updated evaluation of the City’s financial capability assessment based on the newly published guidelines from the US EPA. Raftelis developed a tool to explore the City’s current assessment results which were presented to the City’s regulatory teams with US EPA, DOJ, and the Ohio EPA.
Raftelis was originally engaged by the City to perform a comprehensive cost-of-service, rate design, and financial planning study for the City’s wastewater utility. The City was faced with significant challenges in their efforts to comply with a combined sewer overflow (CSO) consent order that will require more than $1 billion of capital improvements through 2027.
Raftelis developed a cost-of-service and financial planning rate model that was used to evaluate the current rate structure and recommend alternatives that could provide more equitable revenue recovery while also creating a more stable revenue stream in the future. The engagement included working with representatives from many City departments to educate staff outside of the utility and to incorporate their perspectives so that the recommendations were consistent with the vision and goals of the whole City. Raftelis also assisted the City in determining recommended rates for their five wholesale customers and working with the City to negotiate new contracts with these customers.
The financial model integrated multiple scenarios for achieving the CSO controls that were required by the consent order and provides the City with the ability to monitor the impacts to customers. This engagement included detailed analysis of customer bill impacts arising from various rate structure alternatives and capital financing scenarios. Customer impacts were evaluated in the context of the Environmental Protection Agency’s (EPA) 1997 Guidance on Financial Capability Assessment as well as the Integrated Planning Framework concepts. The City has opened a dialogue with the EPA to utilize integrated planning in meeting regulatory requirements and Raftelis provided financial support throughout this process.