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Annual Service Contract - page 41 / 43





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the City require OMI to produce the results specifically stated in the Service Contract and  paid for over the last two years.

Unaccounted-For Water – is double in less than two years. As with the First Review, “the methodology for determining unaccounted-for water is an agreed upon process. Using the only historical data available from the Municipal Utility Department, the UAC is significantly greater than under municipal operation.”

The City of Stockton’s Service Contract requires a 3.5% level of unaccounted-for water. Control over unaccounted for water demonstrates the City and OMI’s belief that our water resources are limited and conservation is imperative.

Control over water flows can be beneficial to the municipal utility as well. Using less water can mean lower electrical and fuel costs to deliver the water to Stockton customers. This could create more profit for OMI.

By meeting the standard set by the Contract, OMI also has an opportunity to set an “efficient water use” example and demonstrate that they can be a steward of the environment. If OMI had a developed outreach program, they could provide residents with methods on how to lower their water bills through conservation and efficiency.

With less water flowing through the system it tends to lower the risk of backflows and system liability, reduce wear on the equipment and have the potential to expand the system connections without necessarily seeking new water sources. These issues mean all mean lower rates for residents, the sole purpose for outsourcing

Staffing capabilities – is a most blatant violation of the Service Contract. Everyone from the CEO of OMI to the OMI General Manager to the City Council made commitments to staffing continuity. Simply stated this has not even begun to be achieved. In our opinion OMI’s inability to keep employees on this project and their difficulty in maintaining a full complement of employees necessary to fulfill all the components of the Service

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