The Water Board recently approved, unanimously, their 2021 budget with a rate increase of 2.99% with all budget amendments being approved 5-0. While no rate increase is the desire, unfortunately operating costs increase annually; this rate increase effectively covers two years (1.5% per year) as there was no rate increase for 2020 and reflects a 54% reduction from management’s proposed 5.5% rate increase. The Board received management’s proposed budget extremely late and left very little time for review and analysis. Information supporting management’s budget was lacking, very much clouding fiscal responsibility and transparency. Management, not the Board Members, is responsible for budget preparation, administration and control of it.

The proposed budget by management lacked forward thinking and budget strategies to minimize a rate increase and lacked sufficient information to show fiscal responsibility and transparency. We simply can’t continue business as usual, especially in these extraordinary times.-EVERY DOLLAR MATTERS and providing our services at the lowest possible rate is not an option is a must.

Ratepayers have been hit hard enough over the years and we have to do better keeping costs down and increasing revenues but receiving poor, inaccurate and/or incomplete financial information could mislead management and the board to make decisions with unnecessary rate increases, expense reductions etc. I felt sorry for any Board Member who lacks strong financial management and/or budgeting experience as the one presented to the Board was extremely challenging to make sense of it.

The 2021 adopted is part of an overall multiyear plan to stabilize rate increases long term but to immediately give relief from a 5.5% rate increase. The 2.99% is a 54% reduction from the 5.5% proposed increase by management reflecting the Board’s commitment to minimizing rate increases and providing relief to ratepayers especially in this extraordinary and unprecedented time and extenuating circumstances facing all of us with the covid pandemic.

The 2.99% rate increase approved by the Board Members result in an annual increase on a minimum bill of $12.78 for the year as compared to managements’ and rate consultants’ annual increase of $23.51 for the year (so amended budget is a $10.73 savings or 46% vs management’s)). On a quarterly basis minimum bill would be $3.20 increase vs managements’ and rate consultant’s 5.5% proposal which would have increased quarterly bill $5.87 (savings of $2.67or 46% vs management’s)

Board amendments to the budget reduce the rate increase burden from management’s 5.5% proposal to 2.99% is a result of different ideas, budget strategies in depth analysis, digging for savings and utilization of excess reserves where appropriate and satisfies the required debt coverage margin.

There is over $1,000,000 in permanent expense reductions (3% reduction in expenses) alone reducing the 5.5% proposed rate by about 2.0%. This multi-year plan of utilizing excess reserves will help control rate increases for a year or two while the water loss issue is addressed/improves- more consumption billed, less water unbilled/lost and expenses spread over higher billed consumption so lower rate % increase. It also provides time to explore potential cost saving measures such as shared services, workers compensation self- insuring, capital improvements to increase efficiency and reduce operating costs in addition to other areas of expense reduction.