CCR1991106COMMON COUNCIL - CITY OF MUSKEG0
RESOLUTION #106-91
AUTHORIZING CITY AUDITOR TO PREPARE NECESSARY INFORMATION
TO SUBMIT TO PSC AS TO WATER RATES
WHEREAS, the City of Muskego owns and operates a water utility
subject to rates and charges established by the PSC, and
WHEREAS, the last rate review by the PSC occurred in 1988, and
WHEREAS, the process of obtaining a rate order encompasses in
excess of nine months, and
WHEREAS, financial reports prepared by Conley, McDonald, Sprague
h Co. indicate the operating revenues of the water utility
maintenance, depreciation, and tax equivalent requirements, and
historically have been insufficient to cover all operation,
WHEREAS, Conley, McDonald, Sprague & Co. needs at least three
months preparation time prior to submittal and application to
the PSC.
NOW, THEREFORE, BE IT RESOLVED, that the Common Council of the
City of Muskego, upon the recommendation of the Public Utilities
Committee, does hereby authorize Conley, McDonald, Sprague & Co.
to prepare a report for submittal to the PSC as to water rates.
BE IT FURTHER RESOLVED that the Conley, McDonald, Sprague &
Co. report shall be reviewed by City staff prior to its
submission to the PSC.
BE IT FURTHER RESOLVED that the Mayor and Clerk are authorized
to sign the attached engagement letter with Conley, McDonald,
Sprague h Co.
DATED THIS 14TH DAY OF MAY , 1991.
PUBLIC UTILITIES COMMITTEE
Ald. Daniel J. Hilt
Ald. William T. Simmons
Ald. David J. Sanders
ATTEST:
City Clerk
5/91cac
CONLEY McDONALD, SPRAGUE & CO.
Certified Public Accountants & Consulranrs
Nicholas D Quarraro.C.PA
Frederxk L. Llcau. C.PA
V~mr N. Weiler, C PA.
William B. Volkmann.C.PA.
Roberr L. Gundrum. C.PA.
Dawd L Donlhue, C PA.
Donald N. Vdione. C.PA.
Paul A Nownrkt C.PA
April 8, 1991
19601 W Bluemound Road
PO. Box 0975
Braoklleld. Wisconsm 53008-0975
(414) 796-0701
FAX(414) 796-0422
Kenosha. Wixonm 53140
2106 6lrd Srrect
(414) 552-7909
(414)657-6156
FAX(414)657-1314
Mr. Wayne G. Salentine, Mayor
City of Muskego
W180 S7732 Racine Avenue
Muskego, WI 53150
Dear Mr. Salentine:
We are pleased to submit this letter of arrangement for the assistance we will provide the
City with its application to the Wisconsin Public Service Commission (PSC) for a water rate
increase.
This letter is to confirm our understanding of the terms and objective of our engagement
and the nature and limitations of the services we will provide.
We will coordinate, under the direction of the City Clerk, the preparation of the necessary
information to be submitted to the PSC with the application for a rate increase. Our
responsibilities will include:
0 Assisting City personnel in the assembly and preparation of various statistical and
non-statistical information.
0 Determination of revenue requirements including a rate of return sufficient to
0 Compiling from information you provide, the following projected statements for
meet cash flow and debt service requirements.
1991 and 1992 as required by the PSC:
1. Statements of estimated revenues and expenses,
2. Statements of estimated operation and maintenance expenses,
3. Statements of estimated plant asset additions and retirements,
4. Statements of estimated utility plat in service and accumulated depre-
5. Statements of estimated financing sources of utility plant additions.
ciation,
A compilation of projected financial statements involves assembling financial statements
based on management's assumptions and performing certain other procedures with respect
to the statements without undertaking to express a conclusion or any other form of
assurance on the assumptions underlying such statements.
Page 2
City of Muskego
April 8, 1991
We direct your attention to the fact that management is responsible for the projected
financial statements and the underlying assumptions, and such statements are those of
management.
Our field work for this engagement will begin in late May or early June of 1991.
Completion of this engagement will approximate six weeks form the time the engagement
commences.
Our fees for this service will be based on the time required by the individuals assigned to
the engagement plus direct expenses. Individual hourly rates vary according to the degree
of responsibility involved and the skill required.
This engagement does not include any services not specifically identified in this letter.
Additional services which you may request will be subject to arrangements made at the time
of such request.
Should you have any questions, please do not hesitate to contact me. We appreciate the
omortunitv to serve the City of Muskeao. If this letter correctly expresses your
it to us.
uiherstanding of the engagement, please sign the enclosed copy where indicated and return
Very truly yours,
CONLEY. McDONALD. SPRAGUE & CO. W/Y"
Donald N. Vilione. CPA
Partner
DNV/klp:me
Enclosures
Approved:
Name: A/ J
Date: '0
May 15, 1991