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Centerville Water and Sewer Rate Study Phase 2 Update June 9, 1999 Financial Priorities 1. Quarterly Service Fees meet Annual Operation and Maintenance Costs. 2. Connection Charges and hook -up charges meet Capital project needs and maintain a positive cash flow in all infrastructure accounts. 3. Establish a Capital Replacement Fund (CRF) for all major infrastructure repairs. Once established by a combination of revenue sources, the CRF should be maintained by revenue from annual service charges and connection fees. Phase Two Study Results Comparison of Rates with Neighboring Communities (Separate Handout) 1. Sanitary Sewer Rates are less than Neighboring Communities. 2. Water Rates are lower than four communities and about $ 3.75 higher than other two. 3. Centerville is only community currently with Storm water Fees, Hugo will adopt some for 2000. Future Operation and Maintenance Costs 1. Centerville currently has about 970 households and population of 2,900. Year 2020 projected households are 1750 and sewered population of 4,600. Estimated saturation is about 1782 households. 2. Sanitary Sewer O &M needs are projected to be from $ 340,000 to 390,000 per year. About $ 280,000 to 320,000 is estimated as the MCES charges- $ 60,000 to 70,000 in local costs. 3. Water O& M needs are projected to be from $ 155,000 to 170,000 per year. 4. Storm water costs are assumed to be from $ 12,000 to 14,500 per year. Sanitary Sewer Rates 1. Increase current service charges from $ 39 /quarter to $ 51 /quarter over next 4 years. That means an average annual increase of $ 12 /year or $3 /quarter. This will close the current shortfall, which is primarily due to MCES charges. Current average costs exceed service charge revenues by about 30%. Currently, this difference has been paid for by connection fees and hook -up charges. 2. Reevaluate Sewer Rates in 2005 to look at the 2005 to 2020 period. BRA Project 616-99 -102 1