| The city last increased water rates 5% effective on bills in July 2003.
During FY 2003-04 actual operational costs are projected to be 3.5% above
the prior year and are budgeted to rise another 4% in FY 2004-05. Contrasted
with this are water sales revenue projected to be nearly 10% less than
anticipated for the year ending Junes 30, 2004 due to weather and conservation.
Cost increases are primarily related to personnel, power, chemicals and supplies.
Actual revenues and expenses vary with temperature, rainfall and customer
use sometimes compromising financial forecasts and potentially jeopardizing
fund balances and bond coverage compliance. A revenue reserve account is
employed to minimize such variations but an increase is necessary to adequately
fund years where revenues fall short of expenses.
The average residential water bill using 1000 cubic feet in a month will
increase $1.15 from $22.19 to $23.34 with this change. A commercial account
using 3500 cubic feet in a month will increase $3.28 from $62.36 to $65.64.
The intent is to raise rates July 2004, monitor the balance of operational
revenue to operational expense, adjust where necessary to provide adequate
revenue to meet expenses and comply with bond coverage requirements and to
update the rate model during FY 2004-05.
Part of this rate change is a 5% increase to cover charges for water used
from the Talent Irrigation District system. Increasing the TID unmetered
charge from $75.00 to $78.75 will cover the city's maintenance and repair
costs and remain consistent with other customer increases. |
