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3. Provide for a Capital Replacement Fund for all major infrastructure elements. Replacement <br /> Funds will allow future replacement and or major repair work. <br /> We evaluated the current utility rates in their ability to satisfy these financial priorities. <br /> Sanitary Sewer Rates <br /> Centerville's sanitary sewer revenues meet and exceed current operating expenses and capital <br /> project needs. These revenues provide for an annually increasing Enterprise Fund. 1997 Revenues <br /> and Costs were evaluated as follows. <br /> 1997 Sewer Revenue Service Charges $ 122,245 <br /> Hook -up fees 115,918 <br /> $ 238,163 <br /> 1997 Operating Costs MCES Charges ($ 100,747) <br /> City Expenses ( 34,696) <br /> ($ 135,443) <br /> Operating Net Income $ 102,720 <br /> Interest Income from Investments $ 30,240 <br /> Fund Transfers (8,650) <br /> 1996 Enterprise Fund Balance $ 738,906 <br /> 1997 Enterprise Fund Balance $ 863,216 <br /> Sanitary Sewer Rates Evaluation, Conclusions and Recommendations: <br /> 1. Sewer Service Charge Revenues are less than annual operating costs, $ 122,245 versus $ <br /> 135,443. This is about a 10% shortfall. Revenue from Hook -up fees are able supplement <br /> these revenues given the current community growth. A Phase Two study should evaluate how <br /> and when to increase current quarterly service charges to meet these needs without using <br /> revenue from hook -up fees. <br /> 2. The Sewer Enterprise Fund has grown for many years and is expected to continue to grow <br /> over the next 10 years. Sufficient capital reserves exist to fund non - assessed City sewer costs. <br /> A Phase Two study should evaluate the ability of this fund to handle proposed Capital <br /> Improvements in the next 10 years. <br /> 3. There is no Sanitary Sewer Replacement Fund. A Replacement Fund should be begun with a <br /> portion of the current funds in the Enterprise Fund. The estimated Total Replacement Value <br /> for the Sanitary Sewer system is about $ 6,437,000 $ 41,800 per year should be set aside to <br /> provide for a Replacement Fund. An initial Fund balance should be at about $ 400,000. A <br /> Phase Two study should evaluate how to best set up this Replacement Fund and sustain it <br /> with both hook -up fees and service charges. <br /> 2 <br />