Managing and Planning for Long-Term Financial Health

Municipal agencies struggle with many complex challenges—delivering high-quality, affordable drinking water; protecting the environment, meeting increasingly tough regulatory standards; keeping customer service high; and managing facilities to
cost-effectively meet long-term public needs.

Especially today, as we face budget gaps and staff cuts, municipalities want strategies to help them operate more efficiently. Some agencies are implementing formal efficiency plans and programs with measurable goals, and looking outside their own organizations for help in fiscal planning and decision-making. Red Oak Consulting has worked with municipal agencies and utilities nationwide to develop a range of effective financial strategies.

Real-time Revenue Sufficiency Analysis Ensures Affordable Long-Term Solutions

One of Red Oak Consulting’s midwestern clients requested assistance with the development of a 20-year master plan. Our unique interactive revenue sufficiency model was utilized to analyze the affordability of long-term planning alternatives. Red Oak’s dynamic financial model offered graphical images of changes in various parameters, such as operating and capital expenditures and debt-service levels. The resulting changes in the agency’s revenue requirements were evaluated in real-time. Real-time revenue sufficiency analyses enabled decision makers to reach consensus on the necessary rate and charge modifications in a fraction of the time compared with the standard “report-comment-correct” process. This interactive process was delivered in a public forum, with active input from stakeholders and decision makers—saving time, money, and achieving agency objectives.

Cost of Service Studies Support Customer Class Equity

Facing significant capital outlays for needed public works improvements, the city of Grand Forks, North Dakota, wanted an equitable, sustainable way to pay for them. Red Oak Consulting conducted cost-of- service and rate study evaluations for the water, wastewater, storm water, and solid waste utilities to ensure that the costs associated with operations were allocated equitably across customer classes. The model also helped the city to establish cost-based rates and develop financial plans for infrastructure improvements.

Financial Planning/Asset Management Create a Sustainable Enterprise

Fairfax County, Virginia, needed to develop an updated financial model to enable management to forecast more accurately and support the county’s asset management program. Red Oak Consulting’s powerful modeling tool enabled officials to forecast and monitor financial information, such as system revenues, expenses, and fund balances. Flexible user-friendly interfaces are utilized to conveniently adjust and analyze the financial impact of changing revenue streams, debt issuances, and other variables that impact the agency’s financial performance.

Recognizing that no two municipal agencies are alike, Red Oak Consulting focuses on helping each organization to develop more efficient pathways to lasting solutions.