Water Valley Metro Districts Board Meeting Water Rates and Forecast Review
Explore the recent Water Valley Metro Districts board meeting discussing current water rates, non-potable water, comparative rates, and a forecast for the water enterprise over the next 10 years. Dive into important topics like cost comparisons and strategic recommendations.
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Presentation Transcript
WELCOME W ATER V ALLEY METRO DISTRICTS APRIL 14, 2021 BOARD MEETING
Topics: Review Current Non-Potable Water Rates Review Competitive Water Rates Compare Our 2017 10-year Forecast with Actual Results Present Current 10-Year Water Enterprise Forecast Under Various Scenarios Recommendations and Discussion Value Comparison Outline Total Metro District / HOA Costs for Water Valley W ATER V ALLEY METRO DISTRICTS
Water Rates: Current Water Valley Rates: Base Rate of $306 per year per residence $1.52 per K gallon surcharge for use over 202 K gallons. (Water Valley South) Commercial Rate: $1.52 per K gallon Town of Windsor Potable-Water Rate $ 4.78 / K Gallon $ 7.14 / K Gallon $10.63 / K Gallon Other Water Districts: 1st Tier For up to 16,000 gallons / month For 16,001 through 22,500 gallons / month For use over 22,500 gallons / month 2nd Tier 3rd Tier Evans (Non-Potable) $2.66 / K Gal (Limited Availability) $3.75 / K Gal (Limited Availability) $5.70 to $11.27 / K gal (Flat rate of $12.02 / K gal outside city) $5.34 to $13.54 / K gal Greeley (Non-Potable) Greeley (Potable) Evans (Potable) W ATER V ALLEY METRO DISTRICTS
Enterprise Fund 10 Year Estimates Presented in February 2017 Actual 2016 Budget 2017 Pro Forma 2018 Pro Forma 2019 Pro Forma 2020 Pro Forma 2021 Pro Forma 2022 Pro Forma 2023 Pro Forma 2024 Pro Forma 2025 Beginning Funds Available $ 38,254 1,321,628 $ 580,945 $ 583,005 $ 589,496 $ 606,773 $ 634,322 $ $ 658,273 $ 707,739 $ 747,766 Water Service Revenues: K-Gallons Produced Effective Rate per K-Gallon Total Water Service Revenues $ $ 479,470 1.09 522,622 513,980 $ 668,174 $ 528,355 $ 803,100 $ 542,730 $ 824,950 $ 557,105 $ 846,800 $ 571,480 $ 868,650 $ 585,855 $ 925,651 $ 600,230 2.10 1,260,483 $ $ 600,230 2.10 1,260,483 $ $ 600,230 2.10 1,260,483 $ $ 1.30 1.52 1.52 1.52 1.52 1.58 Operating Costs & Contingency Cost per K-Gallon Water Services Surplus (Deficit) $ $ $ 546,859 1.14 (24,237) 541,557 $ $ 126,617 $ 600,341 $ $ 202,759 $ 625,262 $ $ 199,687 $ 643,829 $ $ 202,970 $ 662,910 $ $ 205,739 $ 682,521 $ $ 243,130 $ $ $ $ 702,676 1.17 557,807 $ $ $ 721,956 1.20 538,527 $ $ $ 741,814 1.24 518,669 1.05 1.14 1.15 1.16 1.16 1.16 System Development Revenue: Number of New Units System Development & Install / Unit Total System Fees System Development Expenditures: Water Meters & Install Fees / Unit Total Water Meter Cost $ 575,000 $ 115 $ 575,000 $ 115 $ 575,000 $ 115 $ 575,000 $ 115 $ 575,000 $ 115 $ 575,000 $ 115 0 0 0 $ 854,600 $ - 5,000 5,000 5,000 5,000 5,000 5,000 $ $ 5,000 - $ $ 5,000 - $ $ 5,000 - $ 295,981 $ - 2,400 276,000 $ $ 2,400 276,000 $ $ $ 2,400 276,000 $ 2,400 276,000 $ $ 2,400 276,000 $ $ 2,400 276,000 $ $ $ $ 2,400 - $ $ 2,400 - $ $ 2,400 - System Development Surplus $ 558,619 299,000 $ 299,000 $ 299,000 $ 299,000 $ 299,000 $ 299,000 $ $ - $ - $ - Other Revenues (Expenses): $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Debt Service: Debt Service Per K-Gallon Debt Service Coverage (3,944,246) $ $ 219,600 $ $ 349,699 $ $ 342,196 $ $ 334,693 $ $ 327,190 $ $ 368,180 $ $ $ $ 358,340 0.60 1.56 $ $ 348,500 0.58 1.55 $ $ 338,660 0.56 1.53 (8.23) 0.43 1.94 0.66 1.43 0.63 1.46 0.60 1.50 0.57 1.54 0.63 1.47 4,478,628 $ 206,017 $ 152,060 $ 156,491 $ 167,277 $ 177,549 $ 173,950 $ $ 199,467 190,027 $ 180,009 $ Enterprise Fund Surplus (Deficit) 3,195,254 $ 946,700 $ 150,000 $ 150,000 $ 150,000 $ 150,000 $ 150,000 $ $ 150,000 150,000 $ 150,000 $ Capital Outlay Ending Funds Available 1,321,628 $ 580,945 $ 583,005 $ 589,496 $ 606,773 $ 634,322 $ 658,273 $ $ 707,739 $ 747,766 $ 777,775
Then and Now Last rate increase implemented in spring 2018 Anticipated Water Service Revenues of $847,000 in 2020 Actual Revenues of $850,000 Anticipated 2020 Year End Cash Reserves of $607,000 Actual reserves of $982,000 Higher Cash Reserves caused primarily by accelerated collection of Capital Fees Anticipated 2020 Operating Costs of $644,000 Actual Costs of $698,000 Anticipated Capital Expenses of $150,000 per year Now believe that it would be appropriate and advisable to increase capital expenditures. Anticipated that water rates would increase to $2.10 / K Gal by 2023 to offset the loss of Capital Fees and to cover increases in costs W ATER V ALLEY METRO DISTRICTS
Water Enterprise 10-Year Estimates No Rate Increase Updated Budget 2021 Estimate 2020 Pro Forma 2022 Pro Forma 2023 Pro Forma 2024 Pro Forma 2025 Pro Forma 2026 Pro Forma 2027 Pro Forma 2028 Pro Forma 2029 Pro Forma 2030 Beginning Funds Available 1,247,819 $ $ 982,153 $ 550,801 $ 121,728 $ (430,990) (1,008,306) $ (1,611,199) $ (2,240,679) $ (2,897,787) $ (3,583,595) $ (4,299,205) $ Rate Increase Rate per K-Gallon Single-Family Home - Base Rate Total Water Service Revenues 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% $ $ 850,000 $ 1.52 307 $ $ 850,000 $ 1.52 307 $ $ 850,000 $ 1.52 307 $ $ 850,000 $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 $ $ $ 1.52 307 850,000 850,000 850,000 850,000 850,000 850,000 850,000 Less: Operating Costs & Contingency Less: Capital Outlay Water Services Surplus (Deficit) $ $ $ 698,128 110,000 41,872 676,900 350,000 (176,900) $ $ $ 697,207 360,500 (207,707) $ $ $ $ $ 718,123 371,315 (239,438) $ $ $ 739,667 382,454 (272,121) $ 761,857 393,928 (305,785) $ $ $ 784,713 405,746 (340,459) $ $ $ 808,254 417,918 (376,172) $ $ $ 832,502 430,456 (412,957) $ $ $ $ $ 857,477 443,370 (450,846) $ $ $ 883,201 456,671 (489,872) $ System Development Revenue: Number of New Units System Development & Install / Unit Total System Fees System Development Expenditures: Water Meters & Install Fees / Unit Total Water Meter Cost System Development Surplus $ $ - $ 150,000 $ 30 $ 200,000 $ 40 $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - - - 5,000 80,000 5,000 5,000 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - $ $ $ - $ $ $ 2,500 75,000 75,000 $ $ 2,500 100,000 100,000 $ $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - 50,000 30,000 Operating Surplus (Deficit) $ 71,872 (101,900) $ (107,707) $ (239,438) $ (272,121) $ (305,785) $ (340,459) $ (376,172) $ (412,957) $ (450,846) $ (489,872) $ Debt Service: Debt Service Coverage $ $ 337,538 0.21 $ 329,452 (0.31) $ 321,366 (0.34) $ $ $ 313,280 (0.76) $ $ $ 305,194 (0.89) $ $ 297,108 (1.03) $ $ 289,022 (1.18) $ $ 280,936 (1.34) $ $ 272,850 (1.51) $ $ 264,764 (1.70) $ $ 256,678 (1.91) Enterprise Fund Surplus (Deficit) (265,666) $ (431,352) $ (429,073) $ (552,718) $ (577,315) $ (602,893) $ (629,481) $ (657,108) $ (685,807) $ (715,610) $ (746,550) $ Ending Funds Available (including capital replacement reserves) 982,153 $ 550,801 $ 121,728 $ (430,990) $ (1,008,306) $ (1,611,199) $ (2,240,679) $ (2,897,787) $ (3,583,595) $ (4,299,205) $ (5,045,755) $ W ATER V ALLEY METRO DISTRICTS
Water Enterprise 10-Year Estimates Self-Funded Capital Updated Budget 2021 Estimate 2020 Pro Forma 2022 Pro Forma 2023 Pro Forma 2024 Pro Forma 2025 Pro Forma 2026 Pro Forma 2027 Pro Forma 2028 Pro Forma 2029 Pro Forma 2030 Beginning Funds Available 1,247,819 $ $ 982,153 $ 678,301 $ 523,353 $ 413,379 $ 408,081 $ 519,408 $ 651,074 $ 803,447 $ 976,905 1,171,838 $ Rate Increase Rate per K-Gallon Single-Family Home - Base Rate Total Water Service Revenues 15% 1.75 354 15% 2.01 406 15% 2.31 467 10% 2.54 513 10% 2.79 564 3% 3% 3% 3% 3% $ $ 850,000 $ 1.52 307 $ $ $ $ $ 1,124,125 $ $ $ 1,292,744 $ $ $ 1,422,018 $ $ $ 1,564,220 $ $ $ 1,611,147 $ 2.87 580 $ $ 1,659,481 $ 2.96 598 $ $ 1,709,265 $ 3.05 616 $ $ 1,760,543 $ 3.14 634 $ $ 1,813,360 $ 3.23 652 977,500 Less: Operating Costs & Contingency Less: Capital Outlay Water Services Surplus (Deficit) $ $ $ 698,128 110,000 41,872 $ $ $ 676,900 350,000 (49,400) $ $ $ 697,207 360,500 66,418 $ $ $ 718,123 371,315 203,306 $ $ $ 739,667 382,454 299,897 $ $ $ 761,857 393,928 408,435 $ $ $ 784,713 405,746 420,688 $ $ $ 808,254 417,918 433,309 $ $ $ 832,502 430,456 446,308 $ $ $ 857,477 443,370 459,697 $ $ $ 883,201 456,671 473,488 System Development Revenue: Number of New Units System Development & Install / Unit Total System Fees System Development Expenditures: Water Meters & Install Fees / Unit Total Water Meter Cost System Development Surplus $ $ - $ 150,000 $ 30 $ 200,000 $ 40 $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - - - 5,000 80,000 5,000 5,000 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - $ $ $ - $ $ $ 2,500 75,000 75,000 $ $ $ 2,500 100,000 100,000 $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - 50,000 30,000 Operating Surplus (Deficit) $ 71,872 $ 25,600 $ 166,418 $ 203,306 $ 299,897 $ 408,435 $ 420,688 $ 433,309 $ 446,308 $ 459,697 $ 473,488 Debt Service: Debt Service Coverage $ $ 337,538 0.21 $ $ 329,452 0.08 $ $ 321,366 0.52 $ $ 313,280 0.65 $ $ 305,194 0.98 $ $ 297,108 1.37 $ $ 289,022 1.46 $ $ 280,936 1.54 $ $ 272,850 1.64 $ $ 264,764 1.74 $ $ 256,678 1.84 Enterprise Fund Surplus (Deficit) (265,666) $ (303,852) $ (154,948) $ (109,974) $ $ (5,297) $ 111,327 $ 131,666 $ 152,373 $ 173,458 $ 194,933 $ 216,810 Ending Funds Available (including capital replacement reserves) 982,153 $ 678,301 $ 523,353 $ 413,379 $ $ 408,081 $ 519,408 $ 651,074 $ 803,447 $ 976,905 1,171,838 $ 1,388,648 $ W ATER V ALLEY METRO DISTRICTS
Water Enterprise 10-Year Estimates New Loan Updated Budget 2021 Estimate 2020 Pro Forma 2022 Pro Forma 2023 Pro Forma 2024 Pro Forma 2025 Pro Forma 2026 Pro Forma 2027 Pro Forma 2028 Pro Forma 2029 Pro Forma 2030 Beginning Funds Available 1,247,819 $ $ 982,153 1,011,853 $ 1,026,441 $ 1,005,832 $ 1,056,075 $ 1,158,655 $ 1,240,721 $ 1,305,639 $ 1,392,867 $ 1,502,851 $ Rate Increase Rate per K-Gallon Single-Family Home - Base Rate Total Water Service Revenues 15% 1.75 354 8% 8% 8% 8% 3% 3% 3% 3% 3% $ $ 850,000 $ 1.52 307 $ $ $ $ $ 1,055,700 $ 1.89 382 $ $ 1,140,156 $ 2.04 412 $ $ 1,231,368 $ 2.20 444 $ $ 1,329,878 $ 2.38 481 $ $ 1,369,774 $ 2.45 495 $ $ 1,410,868 $ 2.52 509 $ $ 1,453,194 $ 2.60 525 $ $ 1,496,789 $ 2.68 541 $ $ 1,541,693 $ 2.76 558 977,500 Less: Operating Costs & Contingency Less: Capital Outlay Water Services Surplus (Deficit) $ $ $ 698,128 110,000 41,872 $ $ $ 664,400 100,000 213,100 $ $ $ 684,332 103,000 268,368 $ $ $ 704,862 106,090 329,204 $ $ $ 726,008 109,273 396,088 $ $ $ 747,788 112,551 469,539 $ $ $ 770,222 115,927 483,625 $ $ $ 793,328 119,405 498,134 $ $ $ 817,128 122,987 513,078 $ $ $ 841,642 126,677 528,470 $ $ $ 866,891 130,477 544,324 System Development Revenue: Number of New Units System Development & Install / Unit Total System Fees System Development Expenditures: Water Meters & Install Fees / Unit Total Water Meter Cost System Development Surplus $ $ - $ 150,000 $ 30 $ 200,000 $ 40 $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - $ $ - - - 5,000 80,000 5,000 5,000 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - 5,000 - $ $ $ - $ $ $ 2,500 75,000 75,000 $ $ $ 2,500 100,000 100,000 $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - $ $ $ 2,400 - - 50,000 30,000 Operating Surplus (Deficit) $ 71,872 $ 288,100 $ 368,368 $ 329,204 $ 396,088 $ 469,539 $ 483,625 $ 498,134 $ 513,078 $ 528,470 $ 544,324 Debt Service: Debt Service Coverage $ $ 337,538 0.21 $ $ 258,400 1.11 $ $ 353,780 1.04 $ $ 349,813 0.94 $ $ 345,846 1.15 $ $ 366,958 1.28 $ $ 401,560 1.20 $ $ 433,215 1.15 $ $ 425,851 1.20 $ $ 418,486 1.26 $ $ 411,122 1.32 Enterprise Fund Surplus (Deficit) (265,666) $ $ 29,700 $ 14,588 $ (20,609) $ 50,242 $ 102,581 $ 82,066 $ 64,919 $ 87,227 $ 109,984 $ 133,202 Ending Funds Available (including capital replacement reserves) 982,153 $ 1,011,853 $ 1,026,441 $ 1,005,832 $ 1,056,075 $ 1,158,655 $ 1,240,721 $ 1,305,639 $ 1,392,867 $ 1,502,851 $ 1,636,053 $ W ATER V ALLEY METRO DISTRICTS
Recommendations: Increase Water Rates by 15% for the 2021 Water Year 2021 Residential Base Rate / Year (202 K Gal): $354 (up from $306) 2021 Per K Gallon on amounts above 202 K Gal: $1.75 (up from $1.52) Residential Increase: $48.00 / Year or $4.00 /Month Continue working with District s Engineers and other consultants to evaluate long term capital needs and maintenance requirements. Evaluate operating, resources management and other efficiencies that may be garnered through the formation of a joint Water Valley / Raindance water authority. Continue discussions with District financial advisors and lenders to determine the optimal plan of finance and water rate structures. W ATER V ALLEY METRO DISTRICTS
Comparative Costs for 202,000 Gallons of Water Water Valley (2021 Rate) @ $1.75 / K Gal Evans (Non-Potable) Greeley (Non-Potable) Windsor Potable Tier-1 Windsor Potable Tier-2 Windsor Potable Tier-3 Greeley Potable Evans Potable $ 1,024 - $ 2,277 $ 1,079 - $ 2,735 $ 354 $ 537 $ 758 $ 966 $ 1,442 $ 2,147 @ $2.66 / K Gal @ $3.75 / K Gal @ $4.78 / K Gal @ $7.14 / K Gal @ $10.63 / K Gal @ $5.07 - $11.27 / K Gal @ $5.34 - $13.54 / K Gal W ATER V ALLEY METRO DISTRICTS
Metro District / HOA costs for $500,000 home: Weld County Assessor Appraised Value Statutory Assessment Rate Assessed Value Water Valley Mill Levy Metro District Property Tax HOA Dues Non-Potable Water Fee Total Costs $ 500,000 7.200% $ 36,000 41.943 mills (4.1943%) $ 1,510 $ 140 $ 354 $ 2,004 / year $ 167 / month RAINDANCE METRO DISTRICTS
FURTHER DISCUSSION W ATER V ALLEY METRO DISTRICTS
