9/3/1991 - Laserfiche WebLink

Home Browse Search

SEP �Yl BOOK 84 RE-EXAMINATION OF CONSULTANT' S_ REPORT` (CH2M HILL) Administrator Chandler reviewed the following: 1"0: Board of County Commissioners DATE: August 28, 1991 FRO i/County E. Chandler Administrator SUBJECT: REFERENCES: FILE: Based on a study and recommendations prepared by the consulting firm of CH2M Hill, the Board of County Commissioners on March 12, 1991 adopted a series of utility rate increases to be effective for a 2-1/2 year time frame. Subsequently, it was determined that an error was made by the consultants in that projected operating expenses for i:he proposed sludge facility had not been deleted. The net effect was that the monthly wastewater facilities base charge was 75 cents higher than necessary. As was presented during the July budget session, the new rates are proposed to be reduced by that amount until the new facility becomes operational. Staff received assurances both verbally and in writing from the consultants that they had verified that there were no other errors, with particular emphasis on the areas relating to the sludge facility. During the last two weeks, it has been determined that another error had been made by the consultants. Contrary to representations made in a letter dated June 17, 1991 from CH2M Hil-1, debt service of approximately $800,000 for the . sludge facility was not deferred from fiscal year 1992 to fiscal year 1993. As a result, there are serious concerns as to whether the study contains other errors and as such, a serious credibility question relating to the validity of the rates recommended by the consultants. Predicated on the consultants recommendations, a number of decisions have been made by the County in terms of not only formal actions, such as adoption of the rates, but also for financial and planning purposes. In addition to the most recent error discovered, if there are other errors, there could be potentially serious implications in a number of areas. Obviously, a thorough re-examination of the rate elements and the resulting rate recommendations is required immediately. in a meeting Tuesday, August 27, with Gregory T. McIntyre, Vice President and Regional Manager of CH2M Hill, he indicated that he understood thoroughly the County's concerns and position with respect to this matter. In addition, he expresses concern about his firm's credibility and reputation. As a result, he indicated that his firm will immediately re-examine the rate elements; identify errors, if any, and make any required corrections and submit a final report. The preliminary estimate is three (3) weeks to complete the re-examination. .I.n addition, Mr. McIntyre agreed that the individuals who prepared the original study would not be assigned to this task. The preceding will be at no expense to the County. Mr. McIntyre indicated that he understood, by the County agreeing to have his firm do the re-examination, the County is not waiving 'any rights to future remedies if the County deems it necessary. Confirmation of the preceding understanding is to be received in writing from CH2M Hill prior to the Tuesday Commission meeting. 14