Memorandum
City of Lawrence
Department of Utilities
|
TO: |
Dave Corliss, City Manager Diane Stoddard, Assistant City Manager Cynthia Boecker, Assistant City Manager |
|
FROM: |
Mike Lawless, Assistant Director of Utilities |
|
CC: |
Dave Wagner, Director of Utilities Philip Ciesielski – Assistant Director of Utilities Beth Frailey Krishtalka – Assistant Director of Utilities Ed Mullins, Finance Director |
|
DATE: |
July 23, 2009 |
|
RE: |
Utilities Department 2010 Water & Wastewater Rates |
After receiving comments from the City Commission Budget Study Session and direction from City Manager’s Office, two (2) reduced budget scenarios were prepared to compare the impacts to water revenue and overall monthly utility bill increases. The scenarios are as follows:
The table below summarizes the budget reduction and the increase in water revenues associated with each option.
|
Option |
Budget Request Reduction ($) |
Water |
Wastewater Revenue Increase |
Combined Revenue Increase |
|
A |
0 |
13.0% |
0.0% |
5.7% |
|
B |
2,006,658 |
8.0% |
0.0% |
3.5% |
|
C |
996,206 |
10.0% |
0.0% |
4.4% |
|
Option A |
|
Option B |
|
Option C |
||
|
|
- |
|
Reduction |
New Total |
|
Reduction |
New Total |
|
Personal Services |
7,783,188 |
|
535,852 |
7,247,336 |
|
186,852 |
7,596,336 |
|
Contractual Services |
5,275,800 |
|
391,000 |
4,884,800 |
|
130,000 |
5,145,800 |
|
Commodities |
3,557,425 |
|
354,000 |
3,203,425 |
|
83,500 |
3,473,925 |
|
Capital Outlay |
647,000 |
|
340,000 |
307,000 |
|
311,000 |
336,000 |
|
Transfers |
3,730,809 |
|
385,806 |
3,345,003 |
|
284,854 |
3,445,955 |
|
Total |
20,994,223 |
|
2,006,658 |
18,987,565 |
|
996,206 |
19,998,017 |
|
|
4,000 Gallon Water & Wastewater - Residential |
||
|
|
Monthly Bill ($) |
Total Increase |
Percent Increase |
|
Existing |
44.57 |
|
|
|
A |
46.47 |
1.90 |
4.3% |
|
B |
45.63 |
1.06 |
2.4% |
|
C |
46.00 |
1.43 |
3.2% |
Attached are:
· The details of the reductions for option B and C.
· A comparison of existing water and wastewater rates to those of the three options.
· A comparison of typical monthly bills of existing rates to each option.
The water volume charges inside city limits for option B and C differ by only $0.02 or $0.03 per 1,000 gallons. The main differences are in the monthly charge which makes the most difference to the low volume customers. Outside city limits customers see more variations in the volume charges. Sewer rates change very little.
Several area cities were contacted to find out what rate increases are being proposed for 2010. No 2010 rates have been adopted. The following table contains the cities that responded.
|
|
Proposed Increases for 2010 |
|
|
|
Water |
Wastewater |
|
Olathe |
2.0% |
5.0% |
|
JoCo WW |
- |
7.0% |
|
Water One |
4.9% |
- |
|
Bonner Springs |
5.0% |
7.0% |
|
Gardner |
5.0% - 6.0% |
8.0% |
|
Lawrence |
10.0% |
0.0% |
Utilities staff recommends Option A as it defers the least amount of maintenance to the water and wastewater systems. If a reduction must be made staff would then recommend Option C as it defers the least amount of maintenance of the remaining two options.