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CCR2016084-Attachment W Sew P 20 Tu W182 S8200 wer Prop 17 Dis esday, O Racine Ave Waukesha (262 r U pos Bu stributed October 1 enue, Musk County, Wi 2) 679-4100 Utili sed udge d 1Th, 2016 kego, WI 53 isconsin 0 ty d et 6 3150-0749 Schedule Statement of income and expense 1 Schedule of capital outlay 2 Schedule of changes in utility working capital: 3 Sewer Fund Definitions 4 CONTENTS Schedule 1 Page 1 2016 2017 2017 % Change 2015 Aug. 31, 2016 2016 Adopted Proposed Adopted From 2016 Actual Actual Projected Budget Budget Budget Budget Operating revenues Sewer service charges $ 6,088,830 3,061,364 6,093,750 6,060,000 6,120,000 - 0.99% Miscellaneous revenues 14,146 5,533 12,775 15,000 12,800 - -14.67% Total operating revenues 6,102,976 3,066,897 6,106,525 6,075,000 6,132,800 - 0.95% Operating expenses Operation and maintenance: Milwaukee Metropolitan Sewerage District: Capital charge 3,558,128 3,624,731 3,624,731 3,629,583 3,793,394 - 4.51% User charge 1,125,962 559,623 1,122,283 1,122,283 1,128,923 - 0.59% Town of Norway Capital charge - - - - - - 0.00% User charge 266,346 178,884 330,000 225,000 350,000 - 55.56% Supervision and labor 441,516 291,100 470,045 468,137 462,787 - -1.14% Supplies and expense 27,597 18,383 28,000 28,000 28,000 - 0.00% Maintenance: Amortization - - - - - - Odor control 2,624 2,046 15,000 22,500 22,500 - 0.00% Building and structures 15,243 10,350 14,000 14,000 18,000 - 28.57% General plant safety equipment 2,910 2,615 7,000 7,000 7,000 - 0.00% Sewerage collection system 57,408 29,407 50,000 125,000 125,000 - 0.00% I & I reduction 28,935 6,560 20,000 100,000 100,000 - 0.00% Electricity 120,731 69,862 130,000 155,000 155,000 - 0.00% Transportation expense 11,182 9,206 18,000 20,000 20,000 - 0.00% 5,658,581 4,802,766 5,829,059 5,916,503 6,210,604 - 4.97% Customers' account expenses: Accounting and collection 67,022 35,448 64,017 64,017 61,258 - -4.31% Meter expense 29,934 - 31,000 31,000 31,500 - 0.00% 96,955 35,448 95,017 95,017 92,758 - -2.38% General expenses: Office Salaries 72,022 38,562 69,717 69,517 66,958 - -3.68% Employee pensions and benefits 258,436 169,303 269,339 $269,339 260,410 - -3.32% Unemployment compensation - - 2,000 2,000 2,000 - 0.00% Office supplies and expenses 52,727 37,688 62,880 68,780 65,077 - -5.38% Outside services 45,424 26,337 56,176 78,343 76,302 - -2.61% 428,608 271,890 460,112 487,979 470,747 - -3.53% Total operation and maintenance 6,184,145 5,110,104 6,384,188 6,499,499 6,774,109 - 4.23% Depreciation 1,055,855 - 1,080,000 $1,135,000 $1,112,400 - -1.99% Total operating expenses 7,239,999 5,110,104 7,464,188 7,634,499 7,886,509 - 3.30% Net operating income (loss) (forward) (1,137,023) (2,043,207) (1,357,663) (1,559,499) (1,753,709) - 12.45% CITY OF MUSKEGO SEWER UTILITY STATEMENT OF INCOME AND EXPENSE 2017 BUDGET Schedule 1 Page 2 2016 2017 2017 % Change 2015 Aug. 31, 2016 2016 Adopted Proposed Adopted From 2015 Actual Actual Projected Budget Budget Budget Budget Net operating income (loss) (forwarded) $ (1,137,023) (2,043,207) (1,357,663) (1,559,499) (1,753,709) - 14.87% Add non-operating income Interest from investments 24,859 8,759 25,000 21,500 25,250 - -14.00% MMSD I&I Subsidy $0 $0 $0 $250,000 $250,000 - Interest income on RCA's and special assessments 21,116 23,277 23,277 20,670 21,750 - -11.20% Sewer Connection Fees 31,000 17,000 30,000 20,000 25,000 - -33.33% Total non-operating income 76,975 49,036 78,277 312,170 322,000 - 298.80% Income before non-operating expenses (1,060,048) (1,994,171) (1,279,386) (1,247,329) (1,431,709) - -2.51% Deduct non-operating expenses Interest charges on long-term debt - - - - - - #DIV/0! Amortization of debt discount $0 $0 $0 $0 $0 - #DIV/0! I&I MMSD Program - $0 $0 $250,000 $250,000 - #DIV/0! Total non-operating expenses - - - 250,000 250,000 - #DIV/0! Net income (loss) before capital contributions $ (1,060,048) (1,994,171) (1,279,386) (1,497,329) (1,681,709) - 17.03% CITY OF MUSKEGO SEWER UTILITY STATEMENT OF INCOME AND EXPENSE (Concluded) 2017 BUDGET Schedule 2 Page 3 2016 Estimated 2016 2017 2017 Total Adopted Proposed Adopted Description Funding Cost Budget Budget Budget 1.2016 Capital Projects Truck - 25% DPW Replacement (C ) - 46,250 Truck - 50% Water/Sewer (C ) 13,404 17,500 Communication Controls Radio (C ) 30,000 30,000 City Garage Maint/Addition (C ) 630,000 Lift Station Upgrades (C ) 7,359 - $ 50,764 723,750 - - 2.2017 Capital Projects Truck - 25% DPW Replacement (C ) - - - - Truck - 50% Water/Sewer (C ) 16,000 - Lift Station Upgrades (C ) - - 50,000 - City Garage Maint/Addition (C ) - - 499,568 - Gas Pump (C ) - - 6,000 SCADA Upgrade (C ) - - 5,000 (C ) - - - - $- - 576,568 - $ 50,764 723,750 576,568 - Note A: Anticipated to be financed with available construction funds Note B: Anticipated to be financed with borrowings Note C: Finance with working capital Note D: Finance with replacement funds Note E: Finance with reserve capacity assessment funds Note F: Reimbursement from MMSD Note G: Reimbursement from Franklin Grand Total CITY OF MUSKEGO SEWER UTILITY SCHEDULE OF CAPITAL OUTLAY Schedule 3 Page 4 Non-TIF Operation Reserve and Special Equipment Capacity Maintenance Redemption Replacement Assessment Construction Fund Fund Fund Fund Fund Total Funds provided From operations: Net income (loss) for the year $ (1,681,709) - - - - (1,681,709) Add charges to income not requiring funds: Depreciation 1,112,400 - - - - 1,112,400 Amortization: Debt discount - - - - Manhole Rehabilitation and Mapping Projects - - - - - - MMSD Funding 250,000 - 250,000 Less: Other - - - - - - Funds provided from operations (319,309) - - - - (319,309) Increases in: Collection of special assessments 4,000 - - 325,000 - 329,000 Other contributed capital collection- RCA Landfill - - - - - - Total funds provided (315,309) - - 325,000 - 9,691 Funds applied Principal payments on debt - - - - - - Capital outlay (Schedule 6 for Construction Fund) - - - - 576,568 576,568 Total funds applied - - - - 576,568 576,568 Interfund transfers - net Interest earnings (8,150) - 8,150 - - - Equipment replacement (26,350) - 26,350 - - - Sewer Connection fees (25,000) - - 25,000 - - Transfer to Construction Fund (576,568) - - - 576,568 - Transfer for debt retirement reserve - - - - - - RCA funds used to finance MMSD capital charge - - - - - - Total transfers (636,068) - 34,500 25,000 576,568 - Increase (decrease) in working capital (951,377) - 34,500 350,000 - (566,877) Working capital, beginning of year 6,706,283 - 905,306 6,450,016 - 14,061,605 Working capital, end of year $ 5,754,906 - 939,806 6,800,016 - 13,494,728 -14.19% 0.00% 3.81% 5.43% 0.00% -4.03% CITY OF MUSKEGO SEWER UTILITY SCHEDULE OF CHANGES IN UTILITY WORKING CAPITAL 2017 BUDGET Schedule 4 Page 5 FUND DESCRIPTION Operations and Maintenance Required to fund, at a minimum, 3 months of operations and maintenance costs. Special Redemption Accounts as a reserve for a percentage of annual principal and interest payments, as required by the debt covenants. Equipment Replacement Fund Used for significant mechanical equipment replacements as required by the DNR. Non-TIF - RCA Includes reserves established to account for capacity assessment levies restricted to finance related capital and/or debt service costs. Construction Accounts for borrowed funds or interfund transfers from working capital to cover the cost of capital projects. MMSD Capital Charge Funding 77.83% = Utility rates & 22.17% = Reserve Capacity Assessments (Prior to 2007, 27.83% was funded by positive tax increments from TID's #2-#7) CITY OF MUSKEGO SEWER UTILITY WORKING CAPITAL FUND DESCRIPTIONS 2017 BUDGET