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A Review of Key Business Services Results in “Win-Wins” for Toho Water and the City of Kissimmee

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When a utility separates, consolidates, and transforms its legal structure from a major city department to an independent water and wastewater public utility – all within a year – it is going through an important milestone in the organization's history, to say the least. That is exactly what happened in Kissimmee, FL, with the 2003 formation of the Tohopekaliga ("Toho") Water Authority which morphed from a major department within City of Kissimmee into a public utility with its own board and governance system.

After one year of operation, the new Toho Water Authority elected to conduct an independent assessment of key business support services being delivered to the utility by the City under an Administrative Services Agreement. To evaluate current service delivery methods, outcomes, and values, Toho retained the services of utility management consultants EMA. Not only were savings identified but also the unanticipated result of turning a potential politically charged assessment exercise into a mutually beneficial engagement.

To provide a systematic approach to reviewing current service delivery, a variation of a new Competitive Service Delivery Review (CSDR) framework was used. The results were intended to determine the best ways for the utility to proceed. Four key business support service processes were selected by Toho management for review: Warehouse/Purchasing (combined City inventory control and procurement functions); Fleet Maintenance; Information Technology; and Finance. The Scope of Work included an assessment of all four areas along with the development of recommendations for preferred service delivery options.

The CSDR process resulted in more than $360,000 in annual cost savings for the utility. It also provided a number of collateral benefits to the City, including a savings of $1 million from its capital budget. In the process, the City's Fleet Maintenance demonstrated a willingness to negotiate a service level agreement to address the utility's main concerns.

The cost to provide services can differ greatly on a functional, departmental, or utility-wide basis. Without a close examination as CSDR affords, it is difficult for a utility to determine the best way to deliver services from quality, efficiency, and effectiveness perspectives. This presentation will explore the CSDR framework and the specific results it achieved in the case of Toho Water.
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Document Type: Research Article

Publication date: 2006-01-01

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