NBS GOVERNMENT FINANCE GROUP - FIRST AMENDMENT (#2026513)

Page 3 The product of this task will be a modeling of the complete organizational, performance, and time requirements for the services under review in this study. TASK 4: COST OF SERVICE ANALYSIS Determine the total estimated and reasonable cost of providing services on annual basis for each department studied, and segregate costs between fee-recoverable and non-fee recoverable services. The analysis will reflect all identifiable costs, such as: • Direct Costs: Costs directly identifiable to the provision of a service, e.g., salaries and benefits for “hands on” activities such as processing, review, field inspection, etc. • Indirect Costs: Applicable support costs for supervision, management, and administrative support as defined by the City’s organizational structure and/or the City’s annual Cost Allocation Plan.1 Calculate fully burdened hourly rates for each department involved in the Study. Rates will consider the applicability of productive hours or direct-billed hours as the basis for calculation, depending on the department or service analyzed. Multiply the fully burdened hourly rates by the time estimates gathered in Task 3 to compute the full cost of each individual fee for service activity. The full cost of service defined by NBS serves as the analytically justified maximum amount that may be recovered through a user/regulatory fee adopted by the City Council. Cross check all data metrics in the fee model to ensure the fee program is structured to recover 100% of costs considered. TASK 5. DRAFT REVIEW AND REVISION Meet with each department to review the outcomes of the analysis. Drafts will detail all the assumptions and data utilized to calculate results as well as a comparison of each fee’s cost recovery performance. Determine any necessary refinements to core assumptions, revise the fee model, and finalize the cost-of- service analysis. This task represents one planned iteration of the analytical work products. Obtain each department’s final sign off on fee models. TASK 6. FEE COMPARISON UPDATE Policy makers often desire a comparison of fee amounts to neighboring jurisdictions. Presence of a comparison will ensure a smoother implementation process and provide a sense of the “market” rate for various services. We will update the comparison previously completed for the City in 2025. TASK 7. RECOMMENDED PRICING REVIEW Discuss pricing objectives from the City’s perspective, i.e., comfort with full cost recovery or some alternative level of cost recovery. Facilitate this conversation by discussing public/private benefits or causation of each activity, potential market sensitivity, interaction with established City goals or policies, 1 The City is responsible for providing a current overhead cost calculation such as a Cost Allocation Plan. Docusign Envelope ID: CCA93C2D-D7BF-4531-88AB-7BBFCD6F0A7ADocusign Envelope ID: DF0F3531-C78A-8495-81AB-E9DA9043C7B4