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<br />RECOMMENDATIONS FOR WATER RATES <br />I. No/Low Cost Strategies for Remainder of FY 88-89 <br /> None <br />II.Proposed Items for FY 89-90 Budget <br /> A. Budget a minimum of $40,000 for a rate study to include <br />the following: <br /> 1. Allocation of cost of service to classes of customers. <br /> 2. Operating and capital financing/revenue requirements to <br />include: <br /> a. Operation and maintenance expenses <br /> b. Routine capital improvements <br /> c. Extensions and replacements <br /> d. Debt service on existing and anticipated bond issues. <br /> 3. Determine revenue requirements from classes of <br />customers. <br /> 4. Desi~n a water rate schedule to recover revenue <br />requirements, recognizing the cost of service allocations, water <br />conservation objectives and other practical considerations. <br /> B.Develop a computer based financing and rate study model <br />which would enable the City to update studies of revenue <br />requirements and/or rate schedules on a periodic basis. The <br />updates could reflect changes in customer growth, revised <br />budgets, revised capital improvement program and usage <br />projections (conservation). <br /> COST: $15,000 <br /> c. Implement new water rates. <br />III. Long-term Planning Strategies and/or CIP Projects <br /> A. Monitor the variables associated with water rates and <br />correct/adjust on annual basis utilizing financing and rate <br />study model. <br />