ITEM: 12.5 ADMINISTRATION - Joe Huss, Finance Director
Title
ADOPTING THE 2012 WATER AND SEWER UTILITY ENTERPRISE FUND BUDGETS
Background
Because the water and sewer utility budgets received final discussion and review at the 12/8/2011 Workshop just prior to this Council meeting, they were not included in the original agenda materials distributed at the 12/8/2011 Workshop.
Council has reviewed the 2012 proposed budgets for the Water and Sanitary Sewer Funds and per the following summaries, has given conceptual approval to the 2012 Budgets:
· Water Utility Fund
o Operations - With adjusted depreciation schedules adjusted, the fund is expected to generate positive net operations for 2012. Additionally, a recommendation for a rate adjustment is unlikely over the next two years.
§ Revenues
· Revenue from water sales are 1.5% greater than in the 2011 budget and closely align with actual revenues in a typical year with typical rainfall and water usage.
· Other operating revenues remain at 2010 budgeted amounts.
§ Expenditures
· 2012 operating expenditures, other than depreciation, are expected to increase by less than 1% in 2012.
o Capital Activity
§ Debt service payments of nearly $550,000 are scheduled for 2012
§ Major capital activity includes $200,000 for the first phase of construction of two new wells.
o 5-year Outlook - Stable, with no immediate need for a rate increase in the near term. For capital improvements, $10 million for a new treatment plant and four new wells has been targeted for 2013 and 2014.
· Sewer Utility Fund
o Operations - With a decrease in disposal charges from MCES of nearly $192,000, the fund is expecting a small gain for 2012. As with the Water Utility, a recommendation for a rate adjustment within the next two years is unlikely.
o Capital Activity
§ With $2 million set to be spent in 2012, the fund's slip lining project is scheduled to conclude next year.
5-year Outlook - As with the Water Utility, the Sewer utility Fund's outlook is stable, with no immediate need for a rate increase likely. For capital improvements, $1.7 million for trunk extensions has been targeted for 2013 and 2014.
Schedule of Actions
12/08/2011 - Workshop Review
12/15/2011 - Council Adoption
Body
WHEREAS, the proposed Utility Enterprise Funds Budgets for the fiscal year commencing January 1, 2012 have been prepared by the City Manager; and
WHEREAS, the City Council has examined, studied, and reviewed said proposed Utility Enterprise Funds Budgets; and
WHEREAS, the City Council has, after due consideration and deliberation, made such amendments and adjustments in the proposed Utility Enterprise Funds Budgets as they consider necessary, desirable, or expedient.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Blaine as follows:
1. That the proposed Budgets for the Water and Sewer Utility Funds attached hereto are approved.
2. That the 2012 appropriations attached hereto are approved.
3. That the 2012 funding sources and fee adjustments identified and attached hereto are approved.
4. That the City Manager is authorized and directed to implement and to administer, within the budgetary funding limits and within adopted City policy and relevant State and City laws and regulations, said approved Utility Enterprise Fund Budgets.
Recommendation
By motion, adopt the resolution contained herein.