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<br /> <br />11/21/2017 <br /> <br />Dave, <br /> <br />I just wanted to give you a quick update regarding the progress of the utility rate study. Our “Base <br />Model” (model for existing customers only – no TCAAP) has been set up with historical audited financial <br />statements and your preliminary 2018 budget. I am currently reviewing usage data provided by the City <br />for water, sewer, and storm water usage. Since it is a large quantity of data, this takes quite a bit of <br />time. (Your utility billing clerk, Pang, has been wonderful to work with, btw.) This phase of the project is <br />nearly done, however. <br /> <br />Based on our discussions, it appears we won’t be able to meet with staff to review the study until <br />December. Given that the City needs to approve a final 2018 budget soon, please know the rate study <br />would have no impact on budgeted expenses for any of the utilities for 2018. However, if the City <br />decides to make any changes to the 2018 budget, please let me know as soon as possible. <br /> <br />With regard to 2018 budgeted revenues, we may need to recommend more than the 2% increases for <br />water and sewer and 3% for storm given current cash balances. I also know we discussed keeping any <br />revenue changes in the rate study for 2018 revenue neutral, however, I believe I may have spoken too <br />soon. I’m hoping we have some additional time to recommend rate increases and any changes to the <br />current structure since the first bills don’t go out until April 2018. Perhaps the City would consider <br />delaying setting rates until we’ve had a chance to discuss? <br /> <br />Feel free to give me a call if you have any questions or if you want to discuss further. <br /> <br />Thanks and Happy Thanksgiving, <br />Jeanne <br /> <br />Jeanne Vogt | Senior Financial Specialist <br />O: (651) 697-8571 | ehlers-inc.com <br /> <br />