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Utilities Director Pinto felt staff is fairly well <br />satisfied that they are on the right track with the new rate <br />structure that is being proposed. We do not, however, have <br />the ability to go into the company and audit their existing <br />rate conditions, and if that is the recommendation, he <br />believed we should hire a consultant. We would have to <br />negotiate as to price, but he believed we should start with <br />a $5,000 maximum. <br />Commissioner Bird asked what he felt the scope of work <br />would be for the outside consultant. <br />Director Pinto felt it should be limited to the -test <br />year of 1982, but that they should go in and audit all the <br />costs they show in the financial statements and relate them <br />not only to the actual dollars that were spent, but as to <br />what they were spent for specifically, and'also look at the <br />management ability of the company, its assets, and make up a <br />depreciation chart to see if we agree or disagree. It would <br />be a full management audit - not just financial. <br />Commissioner Bird noted, in other words, the audit <br />would establish what an independent auditor would feel is <br />the fair rate for a customer to be paying. <br />MOTION WAS MADE by Commissioner Lyons, SECONDED <br />by Commissioner Bird, to establish the existing <br />rate as an interim rate, authorize an expenditure <br />not to exceed $5,000 for the financial and <br />management audit, and proceed and authorize <br />staff to go through the selection process to <br />accomplish this. <br />Administrator Wright recommended funding come out of <br />the MSTU because all monies collected on franchises are put <br />29 <br />JAN 18 1984 BacK 55 PAE 3 <br />