Title
Approval of a Resolution adjusting Water Rates effective January 1, 2015 (FY 2015) and adjusting annually each January through 2019 (FY 2019).
Presented by Keith Lee, Finance Director
Body
Item Summary:
A pro forma of the City's Water and Sewer Fund indicates current revenues are sufficient to cover operating costs of the water system as well as debt service associated with the new water plant. However, other items impacting the sustainability of the fund include annual maintenance capital of $500,000 for the distribution system; salary and benefit cost increases (3% in FY 2015, 2017, 2019); and expected inflationary increases for utilities, fuel and other supplies (1.5% annual inflation).
This action provides for an 8% increase in water rates effective January 1, 2015 as well as annual adjustments of 1.5% each January through 2019.
Committee or Staff Recommendation:
On August 12, 2014 the Administration, Finance, Recreation & Parks Committee recommended placing this item on the August 25, 2014 Mayor and Council Agenda.
Financial Impact:
An average water customer, using 5,000 gallons of water per month, will see a $1.84 per month increase starting in January of 2015.
The initial water rate change will increase water revenue by $120,000 in FY 2015 and $240,000 annually. The 1.5% annual increases from FY 2016 to FY 2019 will result in annual revenue increases of approximately $50,000.
Presented by:
Keith Lee, Finance Director