In November of 2013, the City of Flint (City) engaged Raftelis to perform water and wastewater utility rate studies. The need for the engagement was precipitated by the City’s transition from the use of purchased water from the Detroit Water and Sewerage District (DWSD) to participation in the Karegnondi Water Authority (KWA). The plan involved transitioning—on an interim basis—to the use of raw water drawn from the Flint River, as well as extensive upgrades to the City’s existing water treatment plant. Once the assets required to serve the KWA are constructed, the City will treat raw water from Lake Huron.
Raftelis was engaged to develop two alternative financial planning scenarios to explore the impact of the transition. The first involved a 10-year forecast of consumption, revenue and operating and capital expenditures under the status quo (i.e. remaining a customer of DWSD). The second scenario involved revenue and expenditure forecasts under the anticipated transition. Raftelis developed both scenarios and presented the differential impact of the transition on the financial sustainability of the City’s water utility, as well as City customers, at a City Council meeting and a public forum.
Under a separate contract, Raftelis performed analyses of the City’s customer information system (CIS) data to determine the source of revenue loss, which the utilities have experienced in recent years. These analyses provided insight into the sources of the loss and provided actionable information that City staff can use to improve billing and revenue collection processes.
Due to the challenges and public scrutiny faced by the City of Flint, the original timeline for the analysis of the transition to KWA was relatively compressed. Consequently, scheduling numerous face-to-face meetings was challenging. Instead, we made use of web meetings to ensure timely review of the project deliverables by the City. This allowed us to produce the deliverables faster, and at less cost, than would have otherwise been the case. Additional savings were produced by our data services team, which was able to utilize standard query language (SQL) and Microsoft Access to export the billing data from the City’s legacy mainframe billing system to Microsoft Excel. This allowed for significant time and cost savings over the alternative, entering in the data from printed reports by hand.
During the course of our engagement, the City engaged another contractor to perform a valuation of the City’s water and wastewater utilities. To aid in their evaluation, that consultant worked collaboratively with the City, and the Raftelis team, to use the results of the Raftelis rate model. The Raftelis team participated in additional meetings to aid in this process.
