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Water/Sewer Replacement Fund (Page 72-73)
<br />Background
<br />This fund is used to account for funds set aside from the City’s water and sewer operating utilities to be
<br />used for future equipment replacement and capital costs for the City’s utilities.
<br />
<br />Source of Funds
<br />The Fund receives an annual operating transfer from the Water Enterprise Fund and Sewer Enterprise
<br />Fund.
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<br />Fund Outlook
<br />The entire debt service payment for the public works facility is funded from this fund. This debt will not
<br />be retired until 2034. The first call date on the bond is 2023, and staff is working with our financial advisors
<br />to determine if a refinancing or calling of the bonds is cost effective.
<br />
<br />A utility rate study was completed in 2020. The rate study concluded that a utility rate increase of 3-4
<br />percent would be needed for the near future to fund current operating costs in the enterprise utility funds
<br />and capital costs in this capital fund. With these rate increases, there are sufficient funds available to fund
<br />the capital costs and debt service identified in the next ten years.
<br />
<br /> 2021 Estimate 2022 2023 2024 2025 2026
<br />Revenues $331,615 $436,600 $494,600 $508,700 $521,900 $535,400
<br />Debt Service Transfer Out 229,925 226,925 233,175 229,175 230,175 231,150
<br />Expenditures 122,790 603,620 233,460 316,600 336,140 310,180
<br />Net inc./(dec.) in fund balance (21,100) (393,945) 27,965 (37,075) (44,415) (5,930)
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<br />Beginning Fund Balance $1,891,716 $1,870,616 $1,476,671 $1,504,636 $1,467,561 $1,423,146
<br />Ending Fund Balance $1,870,616 $1,476,671 $1,504,636 $1,467,561 $1,423,146 $1,417,216
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<br />CONCLUSION
<br />City staff has prepared this document in conjunction with those projects and capital items that are known
<br />and for which costs can be reasonably estimated. The CIP should be considered a planning tool and the
<br />projects included for 2022 and 2023 serve as a work plan for staff. 2022 projects will be included in the
<br />2022 Budget that will be adopted by Council in December. For 2023 projects, staff will request
<br />authorization from Council before proceeding with a feasibility study, acquisition, or construction.
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