Raftelis was initially engaged by the City of Burlington (City) to provide bond feasibility support for a debt issuance associated with the City’s sewer utility. We developed a sewer financial planning model that forecasted the City’s sewer operating and capital expenses over a 20-year forecast period, to analyze the impact of financing annual capital expenditures on rate increases and subsequently debt service coverage. Raftelis developed a forecast of rate increases which will fully suffice the City’s annual revenue needs as well as required debt service covenants.
Raftelis is now engaged by the City’s Water Resources Division (Division) to develop a fully integrated financial planning model for its water, sewer, and stormwater utilities. This model will allow the City to perform in-depth, as well as high-level, financial planning analyses to adequately plan for upcoming capital expenditures, or changes in operating expenses and the City’s customer base. The model is equipped with a user-friendly dashboard to allow the City to toggle key assumptions and view real-time results of various scenarios. Raftelis worked with the Division to develop a stormwater financial plan that fully supported operational and regulatory related costs over a 10-year forecast period. Raftelis worked with the Division and the City to develop key financial metrics and potential rate structural changes to ensure financial viability while at the same time mitigating bill impacts on the City’s ratepayers. Raftelis is currently working with the Division to develop alternative revenue sources for its stormwater enterprise fund in order to help offset the cost of its regulatory compliance. Customer assistance programs are also being considered with the goal of providing rate relief to economically disadvantaged customers.
The Division also engaged Raftelis to conduct a meter-to-cash assessment, after discovering several cases of over- and under-billing for non-residential customers. The project is on-going and has included a comprehensive approach to looking at existing and best practices, process mapping, review of standard operating procedures, site visits, billing system validation, and development of new policies to support billing accuracy. Raftelis has also completed a staffing assessment for Water Resources, which identified areas where the Division is over- or under-staffed, based on existing workloads, meeting proactive maintenance schedules, industry best practices, and peer benchmarks. This assessment included a compensation comparison and analysis for Water Resources’ senior staff.
With only 43 full time employees to operate and maintain a water treatment and three wastewater treatment facilities, and their respective collection and distribution systems serving just over 100,000 people on busy weekends when the University is in session, the City of Burlington’s Water Resources Department needed to optimize and restructure, as well as strategically add some new staff. Water Resources lacked both organizational and operational redundancy, and was forced to react to challenges, rather than addressing them proactively. Recognizing this, Water Resources leadership commissioned an organizational assessment to determine whether existing resources could be deployed more effectively and where they could have the highest impact. The study reviewed the organization both from an efficiency perspective and from a structure and staffing perspective. Water Resources and the larger city government wanted to ensure any staff changes provided maximum value.
Raftelis has worked with hundreds of utilities across the country and is engaged with utility benchmarking efforts with the major water industry associations. This experience helped Water Resources assess its organization and its ability to manage and operate current and future programs, initiatives, and performance/resource gaps. The assessment encompassed the organization’s service levels, budgets, staffing, and operational practices to gauge how effectively the Division delivered its core and support services. It also covered Water Resources’ capacity to successfully support regulatory requirements and sustain its activities by examining the effectiveness of its structures and processes, and the efficacy of internal communication. Special attention was given to the meter-to-cash cycle to ensure maximum collection of revenue most efficiently. Conclusions and assessments were supported with performance and benchmarking data from national sources such as the 2017 AWWA Utility Benchmarking: Benchmarking Performance Management for Water and Wastewater and from more than 15 peer New England utilities.
Staffing assessment findings and recommendations were finalized and presented to the Burlington City Council and were approved unanimously shortly thereafter. The City’s mayor supported the changes, reiterating that “Because we have been under-resourced in terms of staff, a lot of the operations are reactive, and we have gaps in our proactive preventative maintenance efforts. When you chronically underinvest and do not complete preventive maintenance tasks, that leads to errors, and under-maintained equipment breaking, and unplanned discharges.” As a result of the changes, Water Resources is in a better position to manage risk, proactively address operational challenges, develop and implement regulatory programs, and invest resources in infrastructure renewal.
