Municipal Utility Rate Study Request for Proposals

The City of Woodbury is requesting proposals for a water and sanitary sewer rate study (with alternates in the proposal for separate storm water and street light utilities rate studies) to assist the city with determining rate impacts associated with its forecasted capital improvement plans as well as potential costs associated with what is expected to be the nation’s largest new water treatment plant designed to treat PFAS-contaminated groundwater.     

Proposals are due no later than the end of the day on March 7, with work on these studies expected to begin in late March 2022. A preliminary version of the water and sanitary sewer rate study should be completed in late May, 2022 with additional versions of the water and sanitary sewer rate study throughout 2022. 

 The optional analyses of the city’s stormwater and street light financial condition and projected rates are expected to begin later in 2022 into early 2023. The overall completion of the studies and submittal of final reports and recommendations in late 2022 to early 2023.

 A digital PDF copy for distribution via email must be received no later than 5 p.m. central time on Monday, March 7, 2022. Proposals submitted after the deadline will not be considered. 

View the Request for Proposal (PDF)

Please note that all questions are to be emailed to Mark Ruff no later than Feb. 22. An answer will be formulated as soon as possible and posted below.

There will be a virtual pre-proposal meeting conducted via Teams on Feb. 23 at 1 p.m. To receive an invitation to the pre-proposal virtual meeting, email Mark Ruff.

 A digital PDF copy for distribution via email must be received no later than 5 p.m. central time on Monday, March 7, 2022. Proposals submitted after the deadline will not be considered. All proposals should emailed  to Mark Ruff

Answers to Questions for the City of Woodbury, MN Utility Rate Study – 2/28/22

  1. When was the last time the City had a formal water or sewer rate study prepared, and by whom?  The City last utilized a water rate study from an external consulting firm in February, 2014.  Springsted prepared the study.   Since that time, City staff has recommended the annual rate changes to the Council without a formal rate study.
  2. When did the City implement an inclining block rate structure for residential customers, and do you know what if any analysis was done regarding water usage patterns for different sized customers before or after implementation? The City implemented an inclining block rate structure in 2015 pursuant to the 2014 rate study.  There was analysis done by the consultant in 2014 on usage patterns.  Given that these data are now almost 10 years old, the City of Woodbury is looking for this 2022 rate study to analyze current usage patterns.
  3. It appears that the City uses a cash basis approach for setting rates, rather than a utility basis (depreciation expense and return on investment) but wanted to confirm. The City has been primarily using a cashflow basis for setting utility rates.  The City’s financial reporting is on a modified accrual basis pursuant to GASB standards.
  4. The budgets for the sanitary sewer and water funds group expense by type of expense (i.e. salaries, operating supplies) rather than utility function (wells, treatment, transmission and distribution, storage, meter reading). Does the City have additional detail that would facilitate categorizing expenses by utility function? The City has additional detail on expenses.   The City expects to rely upon the 2022 rate study consultant to assume the primary role of allocating expenses by utility function for the rate study given the lack of the City’s experience in this area and the current staffing levels in the finance/administration department. 
  5. Does the City currently have monthly user meter data to assist in the analysis of moving to a monthly billing cycle?  Commercial and apartments are billed monthly now so this data exists.  Other residential users are billed quarterly and the data is collected and stored on a quarterly basis.  The City is exploring a new utility billing software and the City is installing new water meter technology over a multi-year period.   Therefore, the actual change to monthly billing for all users would not be for a few years.  The consultant is expected to use existing quarterly data and extrapolate monthly data for the 2022 rate study.