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Proposed Sewer Rates: <br /> Recommended Rates— Based on Existing Rate Structure <br /> Sewer charges would continue to be based on a fixed quarterly charge for residential users and <br /> based on flow for commercial users. There are a significant number of residential sewer <br /> customers who have their own private well, so its not possible to meter water usage and base the <br /> sewer charge from that. We are not recommending a rate structure change, but rather are <br /> recommending an increase in the rate in order to provide for operations, capital and projected <br /> debt. <br /> Average�uaRerty BalSewer Z009 2010 3011 m12 201� 2N� 2015 2016 <br /> Fixed Quarterly $ 105.50 $ 109.72 $ 114.11 $ 118.67 $ 123.42 $ 128.36 $ 133.49 $ 137.50 <br /> The above represents a 4%increase in the base quarterly charge. <br /> Utility users view their water and sewer bill in total and we attempted to control the overall <br /> change in the combined bill for average water/sewer residential and commercial users. The <br /> analysis below is based on a residence in the Navarre area. <br /> Average QuaReriy Bill-Water and Sewer 2009 2010 2011 2012 2013 2014 2015 2016 <br /> Average User(10,000 gallons per quarter) $ 161.01 $ 15522 5 162.34 $ 170.04 � 178.38 � 187.71 $ 197.60 $ 206.73 <br /> High User(2T,000 gallons per quarter) $ 204.19 $ 203.60 S 213.62 $ 224.65 $ 236.81 $ 250.82 $ 265.75 $ 280.34 <br /> Recommended Sewer Fund Cash Balances <br /> Operating Reserve <br /> We recommend the water fund carry a minimum cash balance for operations of an amount <br /> equal to 6 months of operating expenses including depreciation plus annual debt service <br /> and a portion of capital costs. Cash balances are available to accommodate fluctuations in <br /> revenue depending on weather and higher than anticipated operating expenses and for <br /> unexpected expenses, such as main breaks. <br /> Capital Reserve <br /> The remaining cash balance should be held for long-term replacement of the system, <br /> which will not be able to be funded with growth. The recommended measure of a goal for <br /> the capital portion of cash reserves is the accumulated depreciation of assets as outlined in <br /> the City's annual financial report. The following graph demonstrates the projected capital <br /> cash balance related to the target working capital amount: <br /> Urilit� Rute Snulv P�+g�lx <br /> City uf(h•aru. ,�4/nr�re�oru Dec•emher, ?OQ9 <br />