2008 Water Rate and Fee Study - Lake Havasu City

More documents

Recommendations

Info

2. Introduction2.1. Overview and PurposeLake Havasu City (City) retained Red Oak Consulting (Red Oak) to complete a WaterRate and Fee Study (Study). The purpose of the Study was to develop a financial planand rate and fee structure to promote self-sustainability of the City’s water operations,and to recommend rates for service consistent with the financial plan requirements and inline with the City’s pricing objectives.As part of the Study, Red Oak assisted the City to:• Develop an eleven year water enterprise financial plano Evaluate alternative capital improvement and capital funding scenarioso Evaluate creation of water system and water resource development feesinside the IDD as an additional revenue source funding growth-relatedcapital improvements.• City Council did not adopt water system or water resourcedevelopment fees inside the IDD.• Complete a cost-of-service analysis for fiscal year (FY) 2009-10• Develop three alternative water rate structures to fund water rate revenuerequirements.o Evaluate two alternative increases to the Irrigation and Drainage District(IDD) property tax revenue to reduce the magnitude of water rateincreases.• Develop and deliver a financial planning, cost-of-service, and rate design modeland user manual.Components of this project include:• Identify and project costs associated with the operation of the City’s watersystem.• Analyze the existing rate structure for appropriateness and sufficiency of revenuegenerated.• Develop a multi-year financial plan based on information gathered in the courseof the study.• Determine the system’s ability to support debt required for planned capitalprojects.• Complete a cost-of-service analysis for FY 2009-10 test year.Lake Havasu City2008 Water Rate and Fee Study49440142-1
Section 2Introduction• Develop alternative rates for the next three fiscal years, 2009-10 through 2011-12that Council can consider to adopt.2.2. Report OrganizationOur report to the City contains seven sections as follows:• Section 1 – Executive Summary• Section 2 – Introduction• Section 3 – Utility Accounts and Use• Section 4 – Financial Plan• Section 5 – Cost-of-Service• Section 6 – Proposed FY 2009-10 Rates for ServiceThe report contains four appendices including the complete financial plan and revenueprojections (Appendix A), cost-of-service analysis (Appendix B), proposed water ratestructure and bill impact illustrations (Appendix C), and water system fixed assets byfunctional cost (Appendix D).2.3. AcknowledgementsOn behalf of the project team, we would like to acknowledge the commitment andcontributions provided by several members of City Finance and Public WorksDepartments in completing this project. In particular we would like to recognize Ms.Gayle Whittle, Finance Director and Mr. Mark Clark, Public Works Director, for theirinput and guidance throughout the course of this study.2.4. Reliance on City Provided DataDuring the course of this project, the City (and/or its representatives) provided Red Oakwith a variety of technical information, including cost and revenue data. Red Oak did notindependently assess or test for the accuracy of such data – historic or projected. Wehave relied on this data in the formulation of our findings and subsequentrecommendations, as well as in the preparation of this report.As is often the case, there will be differences between actual and projected data, andsome of the assumptions used in this report will not be realized, and unanticipated eventsand circumstances may occur. Therefore, there are likely to be differences between thedata or results projected in this report and actual results achieved and those differencesmay be material. As such, we take no responsibility for the accuracy of data orprojections provided by or prepared on behalf of the City, nor do we have anyresponsibility for updating this report for events occurring after the date of this report.Lake Havasu City2008 Water Rate and Fee Study49440142-2
Page 1 and 2: Lake Havasu City2330 McCulloch Blvd
Page 3 and 4: Table of Contents6.4.1. Water Alloc
Page 5 and 6: Section 1Executive SummaryFuture ra
Page 10 and 11: 3. Utility Accounts and Use3.1. Wat
Page 12 and 13: Section 4Financial PlanTable 4-2.Ph
Page 14 and 15: Section 4Financial Planperiod. The
Page 16 and 17: Section 5Cost-of-ServiceCity’s wa
Page 18 and 19: 5.3. Allocation of Costs to Custome
Page 20 and 21: Table 6-1.Existing and Proposed Bas
Page 22 and 23: Section 6Proposed FY 2009-10 Rates
Page 24 and 25: Lake Havasu City2008 Water Rate and
Page 26 and 27: LAKE HAVASU CITY, ARIZONA FILE: LHC
Page 58 and 59:
LAKE HAVASU CITY, ARIZONA FILE: LHC
Page 60 and 61:
Page 62 and 63:
Page 64 and 65:
Page 66 and 67:
Page 68 and 69:
Page 70 and 71:
Page 72 and 73:
Page 74 and 75:
Page 76 and 77:
Page 78 and 79:
Page 80 and 81:
Page 82 and 83:
Page 84 and 85:
Page 86 and 87:
Page 88 and 89:
Page 90 and 91:
LAKE HAVASU CITY, ARIZONAFILE:LHC A
Page 92 and 93:
Page 94:
show all

2008 Water Rate and Fee Study - Lake Havasu City

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?