Resolution No. 4793 - Laserfiche WebLink

Home Browse Search

MWMC FACILITIES PLAN Capital PlmmLng and Financing Sewer User Rates and System Development Charges Asset Management Financial Forecasting and Budgeting - Financial forecasts and budget policies are intended to guide the Commission in prudent financial forecasting and budget planning, and are included to ensure the financial security and bonding capacity of the Regional Wastewater Program (RWP), as well as meeting m/nimum legal budget requirements. This set of policies also addresses the Commission's legal and contractual commitments regarding the use of sewer revenues to pay for sewer expenses. The purpose of the RWP is to protect public health and safety and the environment by providing high-quality wastewater management services to the Eugene/Springfield metropolitan area. The MWMC and the regional partners are committed to providing these services in a manner that ks effective, efficient, and meets customer service expectations. In order to achieve its purpose, the Commission shall establish and maintain key outcomes upon which RWP work plans and budgets will be focused. 2. The Commission shall maintain annual budgets that balance operating expenses with user fees a_nd other current operating revenue. 3. The Commission will monitor revenues and expenditures, and ma/nta/n a balanced budget through an appropriate combination of cost-saving measures, budget transfers, supplemental budgets and/or user rate adjustments as needed. 4. The Commission shall maintain a multi-year financial forecast and cash-flow projection, which estimates service levels, operating expenses, capital needs, reserves, and debt service. 5. The Commission shall establish and maintain prudent minimum cash reserves, including but not lkrdted to: Working Capital Reserve, Operating Reserve, Capital Reserve, Equipment Replacement Reserve, and Rate Stability Reserve. a. The Working Capital Reserve shall be sufficient to fulfill operating and capital cash flow needs. b. The Operating Reserve shall be maintained to mi_nkn~e the impact of unantidpated revenue shortfalls. c. The Capital Reserve shall accumulate revenue to prov/de for future projects. The Capital Reserve shall be funded by annual contribulions from user rates. A portion of the Capital Reserve shall be kept on hand and designated for conlgngency needs. d. The Equipment Replacement Reserve shall provide for the timely replacement or rehabilitation of equipment and may also be borrowed agairrst to provide short-term financing of capital/mprovements. e. A Rate Stabffity Reserve shall be maintained as necessary to protect ratepayers from volatility in user rates and to enhance credit-worthiness. 8-2 MWMC_8 0_RE'q5 DOC