January 29, 1993 RMARMA
Reese, Macon and Associates, Inc.
City of Okeechobee
55 S.E. Third Avenue
Okeechobee, FL 34974
ATTN: Mr. John J. Drago, City Administrator
RE: Utility Appraisal 1/26/93 Proposal
Dear John:
via facsimile
January 29, 1993
As requested, we have reviewed the referenced document and have the following
comments.
1. Much of this proposal is related to methodology of appraisal techniques and
considerations. These items are most appropriately commented on by PMG.
2. Since we do not know how much time will be required to interface with the
appraisal firm or to review their work, we do not know if $3,000 will cover
these costs. It may be adequate, but the City should not be locked in to this
figure.
3. (Page 1) The existing WTP capacity is 3.12 MGD. However, an additional
80,000 gpd will be released upon 50% construction completion of the
groundwater plant. The current limitation of 3.12 MGD is more reflective of
a negotiated consent agreement procedure than of a physical restriction.
4. (Page 2) We do not necessarily concur that both elevated tanks have reached
the "end of their useful life Other factors have entered into the decision to
remove these tanks. This example should be deleted.
5. (Page 5, last paragraph) We agree with the proposed procedure for
computing the effective worth of a mechanical item. However, we are not
clear what basis the engineer will use for estimating a "remaining economic
life What will be measured to compute this?
9121 N. Military Trail Suite 207 Palm Beach Gardens, Florida 33410
Ph. (407) 625 -6660 FAX (407) 625 -6664
City of Okeechobee
Mr. John J. Drago
Page 2
wdr -014
93 -109
cc: P. Gonot
J. Crahan
6. (Page 5, last paragraph) We expect that a significant portion of the City
system worth will be derived from the value of pipelines in the distribution
and collection system. What technical basis will the engineer use for
establishing the "remaining economic life" of pipelines?
7. (Page 6, first page) We believe the referenced repairs/rehabilitation costs are
intended to be those costs necessary to restore equipment/facilities which have
deteriorated due to deferred maintenance, if any. This is distinct from
repairs/rehabilitation necessary to restore to a new, or like new, condition.
If our assumption is accurate, this should be clarified.
8. (Page 8) We may not have full comprehension of the appraisal process, but
as before, the "reconciliation" process seems to be extremely subjective.
Maybe there is no other reasonable approach, but this should be quantified
as much as possible.
9. We do not have knowledge of the following reports referenced under our
name.
Current Inventory of System Assets
Capital Improvement Needs Report
If you have questions or wish to discuss this further, please call.
Very truly your
William D. Reese, P.E.