A special city council work session is scheduled for Monday, August 31st at 6:00 pm in council chambers to consider the recommendations of the water and wastewater rate study.
The city council retained Raftellis Financial Consultants (RFC) to conduct a comprehensive independent evaluation of the fees and charges of Salida’s water and wastewater enterprise fund. Following their extensive review and analysis of existing fees and charges, financial projections, long-term capital improvement plans and comparable data from other communities, RFC will present recommendations for rate changes to go into effect on January 1, 2106. Presentation slides are available under the meetings page and at this link.
Initial analysis called for significant rate increases starting in 2016 and continuing for several years. City staff worked with RFC to revise several assumptions in the financial plan so the recommended increases would not exceed single digit percentages. Several capital improvement projects were delayed in the plan to allow more time to accumulate the needed funds for completion, and new debt financing is recommended. Any planned funding of cash reserves was eliminated; savings would accumulate only from unbudgeted revenue sources such as water lease revenue and other unanticipated budget surpluses.
The recommendations are based on a financial plan that includes operations and maintenance expenses, debt service, capital projects and related funding alternatives, reserve requirements and targets, and a non-rate revenue. Factors influencing the plan, such as growth in the customer base, volume projections, inflation and system development fees were reviewed and discussed during a previous work session with the city council on July 20th. Please attend the meeting to hear more about the process and recommendations and to provide your public input.