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CCR2020083-Attachment
Sewer Utility Proposed 2021 Budget Distributed Tuesday, October 13Th, 2020 W182 S8200 Racine Avenue, Muskego, WI 53150 Waukesha County, Wisconsin (262) 679-4100 Schedule Page Statement of income and expense 1 1-2 Schedule of operating supplies & services 2 3 Schedule of capital outlay 3 4 Schedule of changes in utility working capital: 2020 Projected Budget 4 5 2021 Proposed Budget 5 6 Schedule of construction funds 6 7 Sewer Fund Definitions 7 8 CONTENTS Schedule 1 Page 1 2020 2021 2021 $ Change % Change 2019 Aug. 31, 2020 2020 Adopted Proposed Adopted From 2020 From 2020 Actual Actual Projected Budget Budget Budget Budget Budget Operating revenues Sewer service charges $ 6,065,375 3,133,477 6,265,000 6,272,500 6,285,000 - 12,500 0.20% Miscellaneous revenues 11,937 3,935 8,450 10,750 10,500 - (250) -2.33% Total operating revenues 6,077,312 3,137,412 6,273,450 6,283,250 6,295,500 - 12,250 0.19% Operating expenses Operation and maintenance: Milwaukee Metropolitan Sewerage District: Capital charge 3,785,158 3,836,352 3,836,352 3,793,049 3,633,028 - (160,021) -4.22% User charge 1,335,706 675,698 1,363,354 1,340,000 1,385,421 - 45,421 3.39% Town of Norway - Capital charge - - - - - - - 0.00% User charge 223,417 151,849 250,000 300,000 300,000 - - 0.00% Supervision and labor 479,136 263,307 470,000 485,869 513,898 - 28,029 5.77% Supplies and expense 42,742 35,079 45,000 47,000 49,000 - 2,000 4.26% Maintenance: - Amortization - - - - - - - Odor control - - 20,000 40,000 40,000 - - 0.00% Building and structures 22,872 4,182 15,000 17,500 17,000 - (500) -2.86% General plant safety equipment 2,171 4,189 7,000 7,000 7,500 - 500 7.14% Sewerage collection system 122,560 64,362 120,000 125,000 125,000 - - 0.00% I & I reduction - - 100,000 100,000 100,000 - - 0.00% Electricity 166,212 85,702 150,000 150,000 160,000 - 10,000 6.67% Transportation expense 15,439 3,760 15,000 20,000 20,000 - - 0.00% 6,195,414 5,124,481 6,391,706 6,425,418 6,350,847 - (74,571) -1.16% Customers' account expenses: Accounting and collection 59,804 42,877 60,000 61,455 58,961 - (2,494) -4.06% Meter expense 37,698 - 38,000 33,655 40,000 - 6,345 0.00% 97,502 42,877 98,000 95,110 98,961 - 3,851 4.05% General expenses: Office Salaries 65,442 42,930 65,200 66,655 64,561 - (2,094) -3.14% Employee pensions and benefits 287,613 141,410 239,720 251,523 278,689 - 27,166 10.80% Unemployment compensation - - - 2,000 2,000 - - 0.00% Office supplies and expenses 73,948 38,281 73,600 84,185 81,650 - (2,535) -3.01% Outside services 88,235 40,663 68,500 129,139 144,850 - 15,711 12.17% 515,239 263,284 447,020 533,502 571,750 - 38,248 7.17% Total operation and maintenance 6,808,154 5,430,641 6,936,726 7,054,030 7,021,559 - (32,471) -0.46% Depreciation 817,523 - 900,000 $1,100,000 $950,000 - (150,000) -13.64% Total operating expenses 7,625,677 5,430,641 7,836,726 8,154,030 7,971,559 - (182,471) -2.24% Net operating income (loss) (forward) (1,548,366) (2,293,230) (1,563,276) (1,870,780) (1,676,059) - 194,721 -10.41% CITY OF MUSKEGO SEWER UTILITY STATEMENT OF INCOME AND EXPENSE 2021 BUDGET Schedule 1 Page 2 2020 2021 2021 $ Change % Change 2019 Aug. 31, 2020 2020 Adopted Proposed Adopted From 2020 From 2020 Actual Actual Projected Budget Budget Budget Budget Budget Net operating income (loss) (forwarded) $ (1,548,366) (2,293,230) (1,563,276) (1,870,780) (1,676,059) - 194,721 -10.41% Add non-operating income Interest from investments 351,221 21,519 300,000 285,000 285,000 - - 0.00% MMSD I&I Subsidy - - - 250,000 500,000 - 250,000 100.00% Interest income on RCA's and special assessments 25,834 37,214 37,214 21,000 25,700 - 4,700 22.38% Sewer Connection Fees 27,000 8,500 25,000 30,000 25,000 - (5,000) -16.67% Total non-operating income 404,054 67,233 362,214 586,000 835,700 - 249,700 42.61% Income before non-operating expenses (1,144,311) (2,225,997) (1,201,062) (1,284,780) (840,359) - 444,421 -34.59% Deduct non-operating expenses I&I MMSD Program - - - 250,000 500,000 - 250,000 100.00% Total non-operating expenses - - - 250,000 500,000 - 250,000 #DIV/0! Net income (loss) before capital contributions $ (1,144,311) (2,225,997) (1,201,062) (1,534,780) (1,340,359) - 194,421 -12.67% CITY OF MUSKEGO SEWER UTILITY STATEMENT OF INCOME AND EXPENSE (Concluded) 2021 BUDGET Schedule 2 Page 3 2020 2021 2021 2019 Aug. 31, 2020 2020 Adopted Proposed Adopted Actual Actual Projected Budget Budget Budget Operation and maintenance: Supplies and expense: Operating supplies $ 9,598 6,686 10,000 10,000 12,000 - 26,144 21,393 28,000 30,000 30,000 - Water expense 7,000 7,000 7,000 7,000 7,000 - $ 42,742 35,079 45,000 47,000 49,000 - General expense Office supplies and expenses: Supplies $ 11,350 6,075 10,000 10,000 10,000 - Other general expense 1,389 1,754 2,000 1,000 1,500 - Telephone and communications 9,398 2,811 7,000 10,075 10,500 - Insurance 47,340 24,300 48,600 53,110 49,650 - Computer expense 4,472 3,341 6,000 10,000 10,000 - $ 73,948 38,281 73,600 84,185 81,650 - Outside services: City administrative charge $ 29,831 15,237 25,000 30,474 30,000 - Accounting 5,000 - 5,500 5,750 6,000 - Legal - - - 5,000 5,000 - Engineering 46,442 22,388 $33,000 $21,500 $27,500 $0 Other outside services 6,962 3,039 5,000 5,000 6,000 - City Building/Equipment Contribution $0 $0 $0 $61,415 $70,350 $0 Computer software modification $0 - - - - - $ 88,235 40,663 68,500 129,139 144,850 - CITY OF MUSKEGO SEWER UTILITY DETAILED SCHEDULE OF OPERATING SUPPLIES & OUTSIDE SERVICES 2021 BUDGET Schedule 3 Page 4 2020 Estimated 2020 2021 2021 Total Adopted Proposed Adopted Description Funding Cost Budget Budget Budget 1.2020 Capital Projects Lift Station Upgrades (C ) 70,000 70,000 Truck (Water & Sewer) (C ) 16,734 19,000 Skid-Steer Loader Trailer (Water & Sewer) (C ) 4,757 5,000 Lift Station #8 (C ) 256,905 - - - $ 348,397 94,000 - - 2.2021 Capital Projects Lift Station Upgrades (C ) - - 50,000 - Apollo Building - Pavement & Gutters (C ) - - 90,000 - Truck (Water & Sewer) (C ) 27,500 - Replacement Truck (accident Water & Sewer)(C ) - - 20,000 - - - - - $ - - 187,500 - $ 348,397 94,000 187,500 - 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 4 Page 5 Non-TIF Operation Reserve and Special Equipment Capacity Maintenance Redemption Replacement Assessment Construction 2020 Fund Fund Fund Fund Fund Total Budget Funds provided Net income (loss) for the year $ (1,201,062) - - - - (1,201,062) (1,473,365) Add charges to income not requiring funds: Depreciation 900,000 - - - - 900,000 1,100,000 Amortization: Debt discount - - - - - - Manhole Rehabilitation - - - - - - - MMSD Funding - 250,000 Less: Paid to utility for implicit cash subsidy - - - - - - - Funds provided from operations (301,062) - - - - (301,062) (123,365) Increases in: Collection of special assessments 4,494 - - 405,000 - 409,494 404,500 Other contributed capital collections - - - - - - - Total funds provided (296,568) - - 405,000 - 108,432 281,135 Funds applied Principal payments on debt - - - - - - - Capital outlay (Schedule 6) - - - - 348,397 348,397 94,000 Total funds applied - - - - 348,397 348,397 94,000 Interfund transfers - net Interest earnings (10,000) - 10,000 - - - - Equipment replacement (26,350) - 26,350 - - - - Sewer Connection fees (25,000) - - 25,000 - - - Transfer to Construction Fund (348,397) - - - 348,397 - - Funds used for debt retirement - - - - - - - Transfer for debt retirement reserve - - - - - - - RCA funds used to finance MMSD capital charge - - - - - - - Total transfers (409,747) - 36,350 25,000 348,397 - - Increase (decrease) in working capital (706,315) - 36,350 430,000 - (239,965) 187,135 Working capital, beginning of year 5,026,419 - 906,466 8,347,557 - 14,280,442 13,280,635 Working capital, end of year $4,320,104 - 942,816 8,777,557 - 14,040,477 13,467,770 Budgeted Working Capital, end of year $5,257,565 - 975,677 7,234,528 - 13,467,770 CITY OF MUSKEGO SEWER UTILITY SCHEDULE OF CHANGES IN UTILITY WORKING CAPITAL 2020 PROJECTED Schedule 5 Page 6 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 $ (1,340,359) - - - - (1,340,359) Add charges to income not requiring funds: Depreciation 950,000 - - - - 950,000 Amortization: Debt discount - - - - Manhole Rehabilitation and Mapping Projects 70,350 - - - - 70,350 MMSD Funding 500,000 - 250,000 Less: Other - Implicit Cash Subsidy to Water Utility - - - - - - Funds provided from operations 179,991 - - - - 179,991 Increases in: Collection of special assessments 4,500 - - 400,000 - 404,500 Other contributed capital collection- RCA Landfill - - - - - - Total funds provided 184,491 - - 400,000 - 584,491 Funds applied Principal payments on debt - - - - - - Capital outlay (Schedule 6 for Construction Fund) - - - - 187,500 187,500 Total funds applied - - - - 187,500 187,500 Interfund transfers - net Interest earnings (9,500) - 9,500 - - - Equipment replacement (26,350) - 26,350 - - - Sewer Connection fees (25,000) - - 25,000 - - Transfer to Construction Fund (187,500) - - - 187,500 - Transfer for debt retirement reserve - - - - - - RCA funds used to finance MMSD capital charge - - - - - - Total transfers (248,350) - 35,850 25,000 187,500 - Increase (decrease) in working capital (63,859) - 35,850 425,000 - 396,991 Working capital, beginning of year 4,320,104 - 942,816 8,777,557 - 14,040,477 Working capital, end of year $ 4,256,245 - 978,666 9,202,557 - 14,437,468 -1.48% 0.00% 3.80% 4.84% 0.00% 2.83% CITY OF MUSKEGO SEWER UTILITY SCHEDULE OF CHANGES IN UTILITY WORKING CAPITAL 2021 BUDGET Schedule 6 Page 7 Actual 2020 Projected 2021 Projected Balance Projected Balance Projected Balance Project 12/31/2019 Revenues Costs Transfers 12/31/2020 Revenues Costs Transfers 12/31/2020 Debt issue and working capital funds: - Vehicles & Equipment - - 16,735 16,735 - - 47,500 47,500 - Lift Station Upgrades - - 326,905 326,905 - - 50,000 50,000 - Building - Pavement & Gutters - - - - - - 90,000 90,000 - Bobcat Skid-Loader - - 4,757 4,757 - - - - - Transfer from replacement funds - - - - - - - - - Transfer from working capital funds - 348,397 - (348,397) - 187,500 - (187,500) - Transfer from reserve capacity assessment funds - - - - - - - - - MMSD Funding - - - - - - - - - Unallocated debt proceeds - - - - - - - - - Interest earnings - - - - - - - - - TOTAL $ - 348,397 348,397 - - 187,500 187,500 - - SCHEDULE OF CONSTRUCTION FUNDS PROJECTED 2020 AND 2021 CITY OF MUSKEGO SEWER UTILITY Schedule 7 Page 8 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 2021 BUDGET