Council action is requested to issue a purchase order to DKMT Consulting LLC for the combined studies, Cost-Benefit Analysis Report and Strategic Plan for Long-Term Ownership of the Power & Light Department (This item addresses items 4.2.j and 5.1.f in the 2023-2024 Independence Action Plan). 

Council approval to issue a purchase order.

In April 2023 Council directed the City Manager to initiate a process to evaluate all options relative to the future ownership model of Independence Power & Light. At Council’s direction, two independent studies were to be commissioned, one to evaluate the impact of a potential sale of the utility and one to investigate the long-term investments necessary for continued ownership and operation of the utility.

The studies support the City of Independence Action Plan item 4.2.j and 5.1.f:

4. A Well-Planned City
4.1 Improve public infrastructure and the condition of public facilities.
j. Determine Long-Term Plan for Independence Power & Light, including Additional Generation Resources, Long-Term Plan for Maintaining Capacity, and Facilitating the Retirement of Existing Combustion Turbines.

5. A Financially Sustainable Organization
5.1 Control Long-Term Costs - Ensure City finances are stable and sustainable.
f. Research and Evaluate the Governance and Operation of Independence Power & Light.

DKMT has been selected to perform the studies. The proposed scope of work details the elements of each study and common data collection that supports both.  In addition, an independent monitor will be assigned by DKMT to ensure the unbiased independence of each analysis.  The timeline proposed will deliver the final report in July 2024.

The fiscal impact to the City is $459,683.00. The Combined Studies are in the 2023-2024 adopted budget, page 237, account number (6110-5226) Administration - Professional Services, IPL Fund 20. 

On September 5, 2023 City Council approved Ordinance 19482 for a budget amendment for an additional $300,000 to the Fiscal Year 2023-2024 budget for Power & Light, account number 6110.5226, Administration - Professional Services, to cover the additional cost of this report.

There will be an upcoming request to City Council for an additional budget amendment in the amount of $169,000 from IPL reserved funds.