SUBJECT/RECOMMENDATION:
Title
Approve appraisal agreement contract amendment with NewGen, increasing the previously approved not-to-exceed amount from $504,000 to $604,000, and authorize the appropriate officials to execute same.
Body
SUMMARY:
At the Sept. 29, 2025 council meeting, the City Council received an electric feasibility presentation prepared by NewGen Strategies and Solutions. The presentation revealed that the City of Clearwater can offer lower electric rates to customers than Duke Energy, with rate savings beginning at 10% per month, and the percentage generally increasing over time.
The study accounted for all known and reasonably foreseeable costs associated with the transaction. However, NewGen’s valuation of the assets to be acquired ($371 million) is estimated at the feasibility level only. In capital planning, feasibility estimates include a significant range of values. Having established feasibility, the next step is to procure a formal appraisal. A formal appraisal will either confirm the $371 million-amount or reveal a higher or lesser amount within the range that NewGen previously identified.
At the Sept. 29 meeting, the City Council unanimously voted to move forward with an appraisal. This agenda item adds $100,000.00 to NewGen’s previously approved contract to cover the cost of the formal appraisal.
APPROPRIATION CODE AND AMOUNT:
A first quarter budget amendment will increase special program M2403, Feasibility Study, by $100,000.00 utilizing unallocated special program fund reserves to fund this agreement.