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FPUD chooses Raftelis for rate study and long-term financial plan


Last updated 10/14/2016 at Noon

Raftelis Financial Consultants, Inc., has been chosen to assist the Fallbrook Public Utility District with the development of a rate study and a ten-year financial plan.

FPUD's board voted 5-0 September 26 to authorize a contract for up to $106,162 with Raftelis, which is headquartered in Charlotte, North Carolina, and has offices in Los Angeles and Murrieta. The FPUD action also authorized an additional $30,000 for short-term staffing support if necessary.

"We expect by the end of the year, November/December, the initial results will go back to the board," said FPUD general manager Brian Brady.

If water rates are based on the cost of service, a water agency is exempt from the public vote required for a public agency to raise taxes or fees. A rate setting policy can be in effect for up to five years and must include a rate design and public hearings.

"The board felt that this was the right time to do that for several reasons," Brady said.

FPUD obtains most of its potable water from the San Diego County Water Authority, which purchases water from the Metropolitan Water District, so FPUD's rates reflect the cost of purchasing SDCWA water and the CWA rates reflect the cost to obtain MWD water. FPUD's tiered rate structure is based in part on costs to the district if additional usage increases the cost for CWA purchases. The CWA also purchases water from the Imperial Irrigation District, and last year the CWA began using water from the Carlsbad desalination plant.

"The board thinks it's prudent to reaffirm our tiered rate structure," Brady said.

FPUD is in the final planning stages for the district's own major supply project; the water district and Camp Pendleton will partner on the Santa Margarita Conjunctive Use Project. FPUD is pursuing Federal and state grants for the capital project but will likely finance the construction with a state loan and the capital expenses will be factored into water rates.

"The board believed it important to have expert analysis by Raftelis for that as well," Brady said.


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