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D RA FT-7/18/06 - '~'n" Needs Correct Letterhead! City of Eugene 858 Pearl Street 1VIEMORANDIJM Eugene, Oregon 97401 (541)682-5242 (541) 682-6826 FAX vvww.eugene-or.gov Date: July 25, 2006 To: Randy Berggren, EWEB General Manager From: Dennis Taylor, Eugene City Manager Subject: Request for Board Consideration for Expansion of the Billing Agreement to Include TSMF The City has been engaged over the past several years in the study of our community's critical transportation system maintenance funding problems. Faced with a growing backlog of street preservation projects and significant pending reductions in our funding for street operations and maintenance activities, the Eugene City Council directed in February that I return to them with a proposal for establishing a Transportation System Maintenance Fee (TSMF) to address these critical transportation funding needs. As you recall, the Eugene City Council adopted in 2002 and then later repealed a TSMF. As part of the city's implementation efforts for that earlier TSMF ordinance, KamTech Systems, LLC, was hired by the City to prepare an analysis of various billing options available for meeting the billing requirements. for a TSMF. One of their primary conclusions was that EWEB's billing system is an asset that cannot be overlooked by the City with respect to options available to us for billing the TSMF. They further concluded that the more the existing EWEB billing system can be utilized in billing for the TSMF, the lower the cost of collection for the City and, ultimately, the community. They also noted in their conclusions that "all separate billing options are considerably more expensive than the current joint billing agreement" between the City and EWEB. There are a number of reasons it continues to make sense for the City and EWEB to consider expansion of the current joint billing agreement to allow for billing of the TSMF on the EWEB bill. The primary one, of course, is reduced joint costs. The costs of monthly billing, software licensing, system operation and maintenance, and certain customer services (e.g., starting and stopping of services) can be shared and divided by the two entities instead of imposed as duplicate service charges on our citizens. In addition, expensive data systems can be shared instead of duplicated, including information on customer, premise and consumption. Since the City is willing to pay for all initial costs of system modification and implementation for the TSMF, the expansion of this long-standing jointbilling agreement offers opportunity for long-term cost savings for EWEB customers, as well, since relatively fixed ongoing operating costs would be allocated across yet another utility system, resulting in lower ongoing billing costs for all of the systems. The most persuasive argument in my opinion, however, for Board consideration for expansion of our current joint billing agreement to include billing'for the TSMF is that it would be a demonstration to the citizens of Eugene of efficient and effective government, as they see EWEB and the City of Eugene working together as intergovernmental partners to minimize costs of utility fee collection across the two organizations. This, in turn, would result in a maximization of the revenue available for delivering direct services to our citizens-in the case of this new fee, the repair and maintenance of the city's streets.