HDR Engineering Inc. 1/18/2022 Amendment 1

assets,and the appurtenances contained within,and develop an estimated replacement cost value based on the estimated current cost to construct the above ground facilities for each utility. This task is not a specific review of each asset of the utilities, but rather a high level review and replacement cost value for purposes of discussion. The estimated replacement cost of the identified facilities will be • developed using the City's best available information,along with generally accepted methodologies and construction cost indices for establishing a replacement cost value. The technical analysis for this task has been substantially completed.At this time, the City has requested additional analysis and review of the assets and continued support as the City evaluates the approach and recommendations. Remaining are a project meeting to review and discuss the assumptions used to calculate the estimated replacement cost of the facilities included for each utility, At the completion of the task, a technical memorandum will be developed to summarize the approach and results of the calculation. Task 3 Assumptions: • City staff will assist in reviewing the key assumptions of the analysis and provide input and comments. Task 3 Deliverables: • A draft and final technical memorandum summarizing the development of the estimated replacement cost of the above ground facilities for the water,sewer,and stormwater utilities. Task 4—Service Center Cost Analysis Review (Updated Task) The City is in the process of planning and evaluating a new Service Center for Public Works. At the start of this study,HDR assisted the City in a review and analysis of the financial impacts to the utilities. At the current time,the City has requested continued,and additional assistance to review the City developed analysis and work with the City to develop the final projections and impacts to the utilities. This task and associated analysis is not intended to be a funding/financing analysis for the City's new Service Center, but rather,provide the City with an understanding of the potential financial/rate impacts of the new Service Center. Task 4 Assumptions: • City staff will provide HDR with a copy of the analyses completed as part of the service center cost analysis. Task 4 Deliverables: • A draft and final electronic technical memorandum summarizing HDR's review of the City's Service Center cost analysis. Task 5:GASB 83 Assistance(Updated Task) HDR will work with City staff to determine any Asset Retirement Obligations(ARO's)-which is defined as"a legally enforceable liability associated with the retirement of a tangible capital asset"where "liability is both incurred and reasonably estimatable". HDR and City staff will identify ARO's listed related to Utility owned • Below Ground Tanks(i.e.,water gas,fuel) • Dams • Distribution and Transmission line Systems