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HomeMy Public PortalAboutPKT-CC-2017-04-04City of Moab 217 East Center Street Moab, Utah 84532-2534 Main Number (435) 259-5121 Fax Number (435) 259-4135 Memorandum To: Councilmembers and Media From: Mayor David L. Sakrison Date: 3/29/2017 Re: Special City Council Workshop Mayor: Council: David L. Sakrison Kyle Bailey Rani Derasary Heila Ershadi Kalen Jones Tawny Knuteson-Boyd The City of Moab will hold a Special Moab City Council Meeting on Tuesday, April 4, 2017 at 5:30 PM. The purpose of this meeting will be: 1-1 Approval of Proposed Resolution #24-2017 —A Resolution Adopting changes in the City of Moab Sewer Rate Schedule 1-2 Budget Workshop for Proposed Fiscal Year 2017-2018 Annual Budget The meeting will begin in the Council Chambers at t ity Center 217 ast Ce er Str et, Moab, Utah. Mayor Da • L. Sakrison In compliance with the Americans with Disabilities Act, individuals needing special accommodations during this meeting should notify the Recorder's Office at 217 East Center Street, Moab, Utah 84532; or phone (435) 259-5121 at least three (3) working days prior to the meeting. First EPA Green Power Community in the Nation AGENDA SUMMARY MOAB CITY COUNCIL MEETING April 4, 2017 Agenda Item #: 1-1 Title: Approval of Proposed Resolution #24-2017 — A Resolution Adopting changes in the City of Moab Sewer Rate Schedule Fiscal Impact: 20% increase in sewer rates FY 2017-2018 Staff Presenter(s): Rachel Stenta, Assistant City Manager David Everitt, City Manager Department: Engineering/Sewer Applicant: N/A Background/Summary: As you may recall, two years ago the City identified a need to schedule annual increases to our sewer rates to meet the rate required to retire the debt on the new Water Reclamation Facility. We have anticipated in each year's budget increasing the sewer rates incrementally until we reach that goal. As part of that process, we commissioned a Sewer Rate Study with Bowen Collins and Associates to assess the bonding revenue requirements of our Sewer Rates. The WRF loan is scheduled to close on April 11, 2017. We learned quite recently that — prior to closing — the City must demonstrate to the funding agency that we will meet the required rate to retire the debt by the time our first payment is due in 2020. The City needs to adopt an anticipated five-year rate schedule along with the Sewer Rate Study upon which the schedule is based. This rate study includes a 10-year budget plan (p. 1-6) that outlines strategies for future rate increases, capital improvement prioritization and maintaining acceptable savings balances. You may note, however, that this approach is not a more nuanced strategy with regard to assessing commercial users, i.e. hotels. Bowen -Collins is currently finishing up an additional rate study that directly addresses this issue with commercial properties, but it will not be done in time to adopt prior to the loan closing. Once that study is complete, we will bring it to you for consideration. This may result in the sewer rates changing again. Options: Approve, Deny or Postpone Staff Recommendation: Approval of the Resolution adopting the five-year rate schedule and accepting the Sewer Rate Study Recommended Motion: I move to approve (insert agenda title) Attachment(s): Proposed Resolution #24-2017 Sewer Rate Study — February 2017 RESOLUTION # 24-2017 A RESOLUTION ADOPTING CHANGES IN THE CITY OF MOAB SEWER RATE STRUCTURE WHEREAS, the City of Moab is planning for an upgrade and expansion to the City's Wastewater Treatment Plant; and WHEREAS, the current sewer rate will not provide sufficient revenues to pay debt service on loans obtained from the State of Utah that will be needed to pay for the upgrade and expansion; and WHEREAS, in order to receive low interest loans or grants from the State of Utah, the City must show that sewer system users pay a reasonable monthly charge for sewer services, in an amount to cover system costs, but not to exceed 1.4% of Median Adjusted Gross Household Income (MAGI); and WHEREAS, the City of Moab's MAGI is $32,965, based on the 2010 census; and WHEREAS, the City's current average residential sewer rate is $21.88, or 0.66% of MAGI, which is considered too low by the state for the City to qualify to receive grants or the lowest interest loans; and WHEREAS, the sewer rate should be raised progressively over the next several years to bring the rates closer to 1.4% of MAGI; and WHEREAS, the proposed rate structure would raise the average residential sewer rate to $26.26, which is an approximate 20% increase over the current average residential sewer rate. NOW, THEREFORE BE IT RESOLVED, that the following five year sewer rates structure shall be adopted by the City of Moab: A. Standard Rates Monthly Base Rate Existing FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $14.40 $17.28 $20.74 $23.22 $24.27 $24.27 Commercial $19.10 $22.92 $27.50 $30.80 $32.19 $32.19 Volume Rate Existing FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $1.70 $2.04 $2.45 $2.74 $2.87 $2.87 Commercial $1.85 $2.22 $2.66 $2.98 $3.12 $3.12 Average Monthly Residential Bill $21.88 $26.26 $31.51 $35.29 $36.88 $36.88 1. Single Family Dwellings Not Connected to the City Water System $24.35 2. Multiple Unit Residential Complexes Not Connected to the City Water System $24.35 per unit 3. Commercial Establishments Not Connected to the City Water System $92.15 4. Governmental Entities and Institutions Not Connected to the City Water System $72.00 5. Spanish Valley Water and Sewer District Sewer Hook-up/Connection Type Monthly Rate Residential (per connection) $11.10 Small Commercial (per connection) $12.70 Large Commercial (per connection) $22.20 Trailer Spaces (per space) $6.00 Motels (per room) $2.40 B. Septage Rates Item FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Recommended Septage Rate ($/gal) $0.090 $0.180 $0.180 $0.190 $0.190 $0.190 B. Individual Rate Calculation In cases in which the City Manager determines that the standard rate or formula as defined in this chapter produces an inaccurate or inappropriate charge, the City Manager may calculate an individual sewer rate based on other available information, providing that the rates calculated must be equitable with respect to other users in the system. PASSED AND ADOPTED in open Council by a majority vote of the Governing Body of the City of Moab this 4t" day of April, A.D., 2017. This ordinance shall take effect on July 1, 2017. Rates for Spanish Valley Water and Sewer District will take effect July 1, 2017. David L. Sakrison Mayor ATTEST: Rachel E. Stenta City Recorder Prepared by: Bowen Collins & Associates, Inc. CONSULTING ENGINEERS Prepared for: SEWER RATE STUDY February 2017 Prepared for: prepared by: CITY OF M046,4p, Bowen Collins 'L& Associates, Inc. . CONSULTING ENGINEERS SEWER RATE STUDY TABLE OF CONTENTS Page No. EXECUTIVE SUMMARY ES-1 Introduction ES-1 Sewer Rate Analysis ES-1 Required Rates to Meet Revenue Needs ES-2 Impact on Moab City Customers ES-2 SEWER RATE ANALYSIS 1-1 Introduction 1-1 Background and Cost Divisions with Other Entities 1-1 Moab Charges to SVW&SID 1-1 Moab Charges for Septage Service 1-3 Projected Revenue Needs 1-4 10-Year Budget Plan 1-6 Rate Calculation 1-8 Rate Comparison 1-10 Recommendations 1-10 LIST OF APPENDICES APPENDIX A — TECH MEMO #2: COST SHARE OF SYSTEM COSTS APPENDIX B — PROJECTED NON -RATE REVENUE AND REVENUE REQUIREMENTS BOWEN, COLLINS & ASSOCIATES I MOAB CITY SEWER RATE STUDY TABLE OF CONTENTS (continued) LIST OF TABLES No. Title Page No. ES-1 Required Rates to Meet Projected Revenue Needs ES-2 1 Projected Charges from Moab to SVW&SID for Operation and Maintenance Costs 1-2 2 Projected Septage Costs 1-3 3 Recommended Septage Rates 1-3 4 Recommended Annual Revenue Increases for the 10-Year Budget Plan 1-7 5 Required Rates to Meet Projected Revenue Needs 1-8 BOWEN, COLLINS & ASSOCIATES II MOAB CITY SEWER RATE STUDY TABLE OF CONTENTS (continued) LIST OF FIGURES No. Title Page No. ES-1 Comparison of Monthly Sewer Rates, Average Residential Customer ES-3 1 10-Year Revenue and Expenditures — Moab City Sewer 1-5 2 10-Year Reserve Fund Balance — Moab City Sewer 1-9 3 Comparison of Monthly Sewer Rates, Average Residential Customer 1-11 BOWEN, COLLINS & ASSOCIATES III MOAB CITY SEWER RATE STUDY EXECUTIVE SUMMARY INTRODUCTION Moab City is in the process of designing a complete replacement of its existing wastewater treatment facility. As a result of this project and general system growth, the City faces potential capital improvement costs, loan service costs, as well as maintenance and operation costs which will likely increase in the years to come. The purpose of this study is to update the City's sewer service charges as necessary to meet those cost needs. Implementing the recommendations contained in this report will assist Moab City in adequately funding potential infrastructure improvements and staying on track with projected operation budgets. This report was originally completed in October of 2016, but was updated in February of 2017 to reflect higher than expected construction costs associated with the City's new wastewater treatment plant. SEWER RATE ANALYSIS The primary objective of this sewer rate analysis is to establish rates that will be sufficient to meet revenue requirements for the City. To accomplish this goal, this analysis focused on six major tasks: 1. Projecting Growth: The Moab City sewer system is currently composed of approximately 2,481 individual accounts compromising 5,528 residential equivalent residential units (ERUs). Based on Moab City water reclamation facility planning information, the estimated total population growth rate for the next six years was estimated to be approximately 1.1 % for all customers. 2. Calculating Revenue Requirements: Total revenue requirements for the City were projected for the next several years. Those requirements included operations and maintenance costs, capital improvement costs, facilities rehabilitation/replacement costs, and debt service. Revenue generated outside of sewer rates (impact fees, sewer sales to SVW&SID, septage sales, finance charges, etc.) was deducted from the total to give the net revenue requirement to be recovered from service charges. 3. Comparing Revenue to Required Revenue: Once revenue requirements are projected, it is possible to compare required revenue to revenue projections. The City has historically been able to fund most projects without bonding and consequently has been able to minimize interest charges that might otherwise be required for capital projects. Unfortunately, projected future capital improvement needs, as well as increases in operation and maintenance costs, show Moab City revenues falling below projected revenue requirements in future years. 4. Developing a Funding Plan to Meet Projected Needs: In order for the City to meet projected expenditures and maintain its reserve fund to acceptable levels, it is important that revenue be sufficient to accommodate future projects. This study develops a plan to maintain the City's savings fund and maintain funding levels appropriate to provide the desired level of service in the wastewater system. BOWEN, COLLINS & ASSOCIATES ES-1 MOAB CITY SEWER RATE STUDY 5. Calculating Final Sewer Rates: Using the City's existing rate structure, sewer rates were calculated to recover needed revenue based on operation and maintenance costs, debt service, and capital improvement costs. Because of the need to have a viable rate plan in place before construction of the treatment plant begins, this rate study has been limited to a revenue needs analysis. It does not include a full cost -of -service analysis or look at the individual components of the City's existing rate structure in any way. It is expected that the City will revisit its rate structure based on cost -of -service principles in the near future and update its rate structure as necessary. REQUIRED RATES TO MEET REVENUE NEEDS The sewer rates shown in Table ES-1 reflect a multiple year rate schedule needed to meet the projected costs of capital improvements and system renewal. After an initial three years of increases to bring rates up to the recommended sustainable long-term level of funding, further annual increases can likely be delayed until after the study period. Table ES-1 Required Rates to Meet Projected Revenue Needs Monthly Base Rate Existing FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $14.40 $17.28 $20.74 $23.22 $24.27 $24.27 Commercial $19.10 $22.92 $27.50 $30.80 $32.19 $32.19 Volume Rate ExistingFYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $1.70 $2.04 $2.45 $2.74 $2.87 $2.87 Commercial $1.85 $2.22 $2.66 $2.98 $3.12 $3.12 Average Monthly Residential Bill $21.88 $26.26 $31.51 $35.29 $36.88 $36.88 IMPACT ON MOAB CITY CUSTOMERS As shown in Figure ES-1 (next page), the City's existing rates are a little lower than the average of service entities surveyed as part of this study. With the rate increases shown in Table ES-1, the monthly rates in Moab City will be toward the upper end of the entities compared, but not the highest surveyed. Considering that the proposed plan accomplishes the complete replacement of the treatment facility, the proposed rates increases appear to be reasonable and not out of line with what would be expected in this situation. BOWEN, COLLINS & ASSOCIATES ES-2 MOAB CITY SEWER RATE STUDY $50.00 $45.00 $40.00 $35.00 s $30.00 $25.00 a� c S20.00 L S 15.00 $10.00 $5.00 $0.00 Figure ES-1 Comparison of Monthly Sewer Rates, Average Residential Customer �� 4 z;Se 6.$1 4Z§t` 4 'FYE 2022 ratesfor other entities based on annual increasesto account for inflation only (396) 'Average bill based on an assumed 4,400galimonth use per residential customer 'Entities may charge taxesthat are not reflected in monthly bills BOWEN, COLLINS & ASSOCIATES ES-3 Otis �a�-" a1q �O' Gti6 �� �� ,o °, C. ativ 4.% MOAB CITY SEWER RATE STUDY SEWER RATE ANALYSIS INTRODUCTION Moab City is in the process of designing a complete replacement of its existing wastewater treatment facility. As a result of this project and general system growth, the City faces potential capital improvement costs, loan service costs, as well as maintenance and operation costs which will likely increase in the years to come. The purpose of this rate study is to update Moab City's (City) sewer rates based on system revenue requirements that have occurred since the City last established rates. The rate study will calculate detailed rates for the next six years and present a longer term finance plan to achieve the City's primary objectives of: • Maintain high quality and reliable sewer service at affordable prices for customers; • Sustain stable revenue generation adequate to fund system needs; and • Minimize the City's long-term costs by avoiding further debt where possible. Implementing the recommendations contained in this report will help Moab City keep its sewer system adequately funded to maintain its current infrastructure and continue to provide dependable service to its customers. This report was originally completed in October of 2016, but was updated in February of 2017 to reflect higher than expected construction costs associated with the City's new wastewater treatment plant. BACKGROUND AND COST DIVISIONS WITH OTHER ENTITIES Moab City presently provides sanitary sewer collection and treatment services to all customers within the City's boundaries. In addition, it accepts wastewater collected from Spanish Valley Water & Sewer Improvement District (SVW&SID) for treatment at the City's existing wastewater treatment plant (WWTP). Moab City separately charges SVW&SID for that service. Moab City also charges fees to private septage haulers in order to accept and treat septage from nearby campgrounds and other similar establishments. As part of this sewer rate study, Technical Memorandum #2: Cost Share of Future Sanitary Sewer System Costs was updated to reflect the modified cash contributions from Moab City and Spanish Valley Water & Sewer Improvement District (SVW&SID) for the new wastewater treatment plant and the finalized impact fees developed by Bowen, Collins & Associates, Inc. The updated document is included in Appendix A. This document provides all the information necessary for establishing Moab City charges for sewer service outside its retail service area. Moab Charges to SVW&SID Based on the results summarized in Technical Memorandum #2, recommended rates charged by Moab to SVW&SID are as summarized in Table 1. BOWEN, COLLINS & ASSOCIATES 1-1 MOAB CITY SEWER RATE STUDY Table 1 Projected Charges from Moab to SVW&SID for Operation and Maintenance Costs' Item FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Flow ERUs 2,707 2,761 2,884 3,273 3,404 3,536 Treatment ERUs 2,944 3,003 3,148 3,583 3,736 3,891 Flow Costs/Month $10,958 $11,388 $12,046 $13,535 $14,262 $15,014 Treatment Costs/Month $13,722 $16,996 $18,112 $20,692 $21,948 $23,254 Total Costs/Month $24,680 $28,384 $30,158 $34,226 $36,209 $38,268 Monthly Flow O&M Cost/ERU $4.05 $4.12 $4.18 $4.14 $4.19 $4.25 Monthly Treatment O&M Cost/ERU $4.66 $5.66 $5.75 $5.78 $5.87 $5.98 Total Monthly O&M Cost/ERU $8.71 $9.78 $9.93 $9.91 $10.06 $10.22 Total O&M Costs $296,157 $340,614 $361,900 $410,718 $434,513 $459,215 Annual Loan Payment $0 $102,207 $102,207 $102,207 $102,207 $102,207 Impact Fee Credit Offset/New ERU/Year $362.38 $331.24 $302.39 $277.78 $254.87 $233.51 Estimated Total Credit Offset $20,919 $19,503 $43,859 $120,743 $39,163 $36,204 Total Costs/Year $317,076 $462,324 $507,966 $633,668 $575,883 $597,626 'Includes projected future San Juan connection costs and USU extension costs 2The large increase in 2020 assumes connections from San Juan occur in this year As shown in the table, it is recommended that the monthly bill to SVW&SID be generated based on four items: • The number of flow ERUs multiplied by the rate per flow ERU • The number of treatment ERUs multiplied by the rate per treatment ERU • A fixed amount for loan costs through the life of the loan (independent of ERUs) • Impact fee credit offset multiplied by the number of new treatment ERUs (will vary based on actual number of new connections)1 It should be emphasized that Table 1 represents charges from Moab to SVW&SID only and is not intended to be a full rate study for SVW&SID customers. It is recommended that SVW&SID evaluate its existing rates to ensure sufficient funding to cover the amounts shown. ' For a more detailed description of this credit, see the 2016 Moab Sewer Impact Fee Analysis and the Technical User Fee Credit Memorandum dated May 25, 2016. BOWEN, COLLINS & ASSOCIATES 1-2 MOAB CITY SEWER RATE STUDY Moab Charges for Septage Service Also based on the results of Technical Memorandum #2, projected septage revenue requirements are shown in Table 2. Based on those projections, Table 2 lists the calculated and recommended septage sales rates to meet the revenue projections. Table 2 Projected Septage Costs Item FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Treatment Costs $76,755 $97,478 $103,438 $108,193 $114,478 $120,972 Debt Service Costs - $143,864 $143,864 $143,864 $143,864 $143,864 Additional Treatment Costs - - $36,257 $36,257 $36,257 $36,257 Total Costs $76,755 $241,341 $283,559 $288,314 $294,599 $301,093 Cumulative Costs $76,755 $318,096 $601,655 $889,969 $1,184,568 $1,485,661 Projected Septage Treatment ERUs 1,372 1,435 1,498 1,561 1,624 1,687 Projected Septage Flows (MGD) 0.0055 0.0057 0.0060 0.0063 0.0065 0.0068 Calculated Septage Rate ($/gal) to Meet Total Costs $0.060 $0.180 $0.202 $0.197 $0.194 $0.191 From the table, it can be seen that the calculated septage rate jumps up over the first two years and then begins to decline after FYE 2019 because the number of septage ERUs continues to increase while the debt service costs associated with the WWTP construction remain fixed. To avoid raising and then lowering of rates during the study period, BC&A would recommend modifying the rates slightly as shown in Table 3 to gradually increase from the current 9 cents per gallon to 19 cents per gallon in FYE 2020 before leveling off. If the total revenue generated by these rates is compared against actual costs as summarized in Table 2, it can be seen that the recommended rates generate a little more revenue than needed to meet costs up front, but then draw on these reserves in a few of the first years after the plant is constructed. By the end of the planning period, cumulative costs and cumulative revenues are nearly identical. Table 3 Recommended Septage Rates Item FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Recommended Septage Rate ($/gal) $0.090 $0.180 $0.180 $0.190 $0.190 $0.190 Recommended Septage $115,551 $241,700 $252,299 $277,503 $288,690 $299,878 Rate Revenue Cumulative Revenue from Recommended Rates $115,551 $357,251 $609,550 $887,053 $1,175,743 $1,475,621 BOWEN, COLLINS & ASSOCIATES 1-3 MOAB CITY SEWER RATE STUDY PROJECTED REVENUE NEEDS With rates established for SVW&SID and septage users, Moab can begin to look at its own customers in greater detail and the overall plan for meeting the future revenue needs of the City. The first step in this process is to project future expenditures. Historic and projected expenditures for the City from FYE 2014 to FYE 2026 are shown in Figure 1. Future expenditures can be grouped into three categories: • Operation and Maintenance Expenditures — These are the annual costs of running the system. They include items such as salaries and benefits for Moab City staff, equipment and supplies, power costs, system repairs, and all other costs associated with doing business throughout the year. The projected operation and maintenance costs for Moab City were based on the City's budgeted amount for FYE 2017. Beyond FYE 2017, it has been assumed that all of the O&M cost categories will annually increase at an assumed inflation rate of 3.0 percent added to half the connected growth rate. The one exception to this is treatment costs. Construction of the City's new treatment plant is tentatively scheduled to be completed in FYE 2018. Following the upgrade, it is anticipated that annual wastewater treatment O&M costs will increase by approximately $115,000. It is typically recommended that rates be re-evaluated every 3 to 5 years. Depending on the actual timing of the new WWTP construction and the magnitude of the subsequent potential treatment O&M cost increase, it is recommended that the City be prepared to update rates to maintain recommended funding levels. • Debt Service — These are the costs paid toward the loan planned to be taken out by the City in the near future. These costs are easily predictable because they are tied to set loan repayment schedules. Currently, the City does not have any sewer related debt. It is anticipated that the new WWTP will require a loan of approximately $14,200,000. Another loan of approximately $1,400,000 is expected in FYE 2019 in association with the construction of the South Trunk Line project. The projected debt service costs for the City have been taken from the City's proposed loan payment schedule. • Capital Improvement Expenditures from Reserves and Loan Proceeds — These are costs for constructing new facilities within Moab City. This can include completely new facilities or replacement of existing facilities. Capital improvement expenditures are usually the most volatile of expenditure categories. Because O&M and debt service costs are basically fixed, budgets are usually balanced by increasing or decreasing capital improvement expenditures as necessary. For this study, only three major new City capital improvement projects are projected to occur during the evaluated time period. The first is the new WWTP. As part of this project, Moab City and SVW&SID will each contribute an agreed upon amount from cash reserves to partially fund the project, $1,320,595 and $800,000 respectively. Moab City will take out a loan for the remaining balance. The second major project is the South Trunk Line. Costs associated with this project are $2,100,000 and have been spread over two years in the rate model. To maintain cash reserves at an acceptable level, it is expected that the City will need a loan for $1,400,000 in FYE 2019 in association BOWEN, COLLINS & ASSOCIATES 1-4 MOAB CITY SEWER RATE STUDY $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 FYE FYE Figure 1 10-Year Revenue and Expenditures - Moab City Sewer FYE FYE FYE FYE FYE FYE Capital Expenditures from Loan Proceeds Debt Service Cash Contribution from GWSSA for WWTP Capital Expenditures from Reserves 0&M — — Projected Income - Recommended Rates Projected Income - Existing Rates FYE FYE FYE FYE FYE 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 BOWEN, COLLINS & ASSOCIATES 1-5 MOAB CITY SEWER RATE STUDY with this project. The final project is the 400 East trunk pipeline which is expected to be replaced in FYE 2021. The remaining expenditures of this category primarily account for rehabilitation and replacement of existing infrastructure and other minor improvements. As with most things, each component of a sewer system has a finite service life. As such, it is necessary to continually budget money for the rehabilitation or replacement of these system components. If adequate funds are not set aside for regular investment into the system, the system will fall into disrepair and be incapable of providing the level of service customers in the City expect. To maintain the sewer system in good operating condition, it is recommended that the City's annual investment into the system be approximately equal to the replacement value of the system divided by its estimated service life. The City's sewer infrastructure (not including the WWTP) is expected to have a remaining service life of approximately 90 years with a combined replacement and rehabilitation cost of approximately $45,000,000. Therefore, the annual investment into the system should be approximately $500,000 in FYE 2017. This number can be refined in the future if the City develops a more detailed asset management plan, but has been used in this study as the basis for future system investment. A detailed table of projected system expenditures is contained in Appendix B of this report. 10-YEAR BUDGET PLAN With the expected expenditures outlined above, it is possible to prepare a future budget plan. A budget plan has been developed and is shown with projected expenditures in Figure 1. The process of creating this budget plan was as follows: 1. Identify projected revenue based on existing sewer rates — Using Moab City's existing sewer rates, Bowen, Collins & Associates (BC&A) calculated the revenue the City could expect to receive over the next 10 years. These projections include consideration of future system growth. 2. Compare projected revenue to required revenue — Once revenue projections have been developed, it is possible to compare revenue projections to required revenue. As can be seen in Figure 1, projected revenue based on existing rates will begin to fall short of expenditures in FYE 2017. In FYE 2017 and moving forward, the situation is expected to get consistently worse. To satisfy the City's anticipated loan repayment schedule and to fund projected capital improvement projects in the future, a rate increase will definitely be needed. 3. Create a plan to transition from existing revenue to revenue adequate to support long-term system needs — To close the gap between projected revenue from existing rates and recommended rate revenue for long-term system needs, it is recommended that existing rates be increased over the next three years. To meet projected rate revenue needs (including minimum bond coverage requirements) a large initial increase will be required. To generate the revenue shown in the budget plan in Figure 1, approximate annual overall rate revenue increases will need to be as shown in Table 4. BOWEN, COLLINS & ASSOCIATES 1-G MOAB CITY SEWER RATE STUDY Table 4 Recommended Annual Revenue Increases for the 10-Year Budget Plan Year Rate Revenue Increase FYE 2018 20% FYE 2019 20% FYE 2020 12% FYE 2021 4.5% FYE 2022 0%* FYE 2023 0%* FYE 2024 0%* FYE 2025 0%* FYE 2026 0%* * No significant increase expected, but small annual adjustments may be needed to account for inflation or other issues. After the initial transition period to bring rates up to the recommended sustainable long- term levels, no annual rate increases other than minor inflation adjustments are expected to be required throughout the study window. 4. Modify capital improvement expenditures to fit within the identified budget — As noted previously, there is not much change that can be made to O&M or debt service expenditures. Therefore, any modifications required to meet the recommended budget plan will need to come through capital improvement expenditures. The capital expenditures shown in Figure 1 represent the level of expenditures that can be supported by the budget plan. See Appendix B for additional details on the magnitude and timing of capital expenditures. 5. Maintain an acceptable savings balance — Presently, the City combines the water and sewer reserve fund. BC&A has assumed that the amount of the reserve fund which can be expected to be available for sewer related purposes is based on the proportion of water and sewer expenditures. Of the FYE 2016 water/sewer reserve fund balance of $3,012,093, it has been assumed that approximately $1,722,000 is available for sewer related expenditures. BC&A recommends that the City attempt to maintain a sewer reserve fund balance approximately equal to 6 months of O&M expenses. A reserve fund balance will allow the City flexibility to deal with various potential issues such as unexpected revenue reductions, ability to avoid bonding for smaller projects, or other emergency purposes. The proposed 10-year budget plan will include transfers into and out of the City's reserve fund based on the timing of capital improvements and system revenue. For example the new wastewater treatment plant construction is tentatively scheduled to occur in FYE 2017-2018. The revenue model plans to transfer money in FYE 2017 out of savings for part of this expense. In FYE 2018, loan proceeds will pay for the remaining portion of the plant and the reserve fund will have unused funds transferred back into it. In FYE 2019 when the bulk of the South Trunk line project funding becomes due, the savings can be utilized to cover a large portion of its balance. BOWEN, COLLINS & ASSOCIATES 1-7 MOAB CITY SEWER RATE STUDY Figure 2 shows the anticipated 10-year savings fund balance with expected transfers into and out of savings based on system revenue and capital improvement projects. The capital expenses for the yet to be determined system replacement and rehabilitation projects are planned to generally be delayed until FYE 2020 to avoid bonding for the other previously named projects. Then from FYE 2023 through FYE 2025 the dollar amounts of replacement and rehabilitation projects that were deferred in FYE 2017 through FYE 2019, will be added to the replacement and rehabilitation budgets of those later years to avoid falling behind on system upgrades. In FYE 2026 and beyond, it is recommended that the City utilize all the full amount budgeted for system rehabilitation and replacement on actual capital improvement projects. RATE CALCULATION Because of the need to have a viable rate plan in place before construction of the treatment plant begins, this rate study has been limited to a revenue needs analysis. It does not include a full cost -of -service analysis or look at the individual components of the City's existing rate structure in any way. It is expected that the City will revisit its rate structure based on cost -of -service principles in the near future and update its rate structure as necessary. With this report limited to a revenue needs analysis, the final step in the rate calculation process is to simply multiply the City's existing rate structure by the percent increases identified in Table 4. The resulting recommended rates are summarized in Table 5. Table 5 Required Rates to Meet Projected Revenue Needs Monthly Base Rate Existing FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $14.40 $17.28 $20.74 $23.22 $24.27 $24.27 Commercial $19.10 $22.92 $27.50 $30.80 $32.19 $32.19 Volume Rate ExistingFYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 Residential $1.70 $2.04 $2.45 $2.74 $2.87 $2.87 Commercial $1.85 $2.22 $2.66 $2.98 $3.12 $3.12 Average Monthly Residential Bill $21.88 $26.26 $31.51 $35.29 $36.88 $36.88 BOWEN, COLLINS & ASSOCIATES 1-8 MOAB CITY SEWER RATE STUDY $3,000,000 $2,500, 000 $2,000, 000 $1,500,000 $1,000, 000 $500,00 $0 Figure 2 10-Year Reserve Fund Balance - Moab City Sewer FYE FYE FYE T FYE FYE FYE FYE Sewer Master Plan Building Project SCADA Upgrades Sewer Lift Station Pump Replace 400 East Trunk Pipeline New South Trunk Pipeline Non -Loaned Treatment Plant Capital Costs Collection - Rehabilitation & Replacement Reserve Fund Balance • • • • Target Fund Balance (6 Months of 0&M) FYE FYE • • • • FYE FYE • • • • FYE 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 $3,000, 000 — $2,500,000 — $2,000,000 $1,500,000 $1,000,000 $500,000 $O BOWEN, COLLINS & ASSOCIATES 1-9 MOAe CITY SEWER RATE STUDY RATE COMPARISON Figure 3 shows a comparison of Moab City's current and proposed sewer rates for an average residential customer with other communities in Utah. The figure displays the projected 2017 average monthly sewer rate and the estimated sewer rate in 2022 for several sewer service entities. As shown in the figure, the City's current rates are a little lower than average compared to other cities and service districts. With the proposed rate increases over the next several years, Moab City's monthly sewer fee will be toward the upper end of the entities compared, but not the highest surveyed. RECOMMENDATIONS Based on the analysis contained in this report, the following actions are recommended: Adopt Recommended Rates: It is recommended that Moab City adopt the rates summarized in Table 5. These increases are needed to meet immediate operation and maintenance needs and to fund capital expenditures to meet the City's longer -term system investment goals. Consider a Multiple Year Rate Schedule: If at all possible, it is recommended that the City adopt the full multiple year rate schedule through 2022. By adopting a multiple year rate schedule, the City can program the desired increases to the rates consistent with the results of this report and provide longer notice to customers. Consider Maintaining Separate Water and Sewer Reserve Fund Accounts: An objective of the recommended rate schedule is to maintain a reserve fund balance approximately equal to six months of O&M costs for emergencies and other purposes. The ability to continually track the sewer reserve fund balance will assist in detecting unexpectedly drops or trends before financial issues become too significant. As part of future rate studies, the existing revenues and reserve fund balances should be evaluated. If water and sewer reserve funds are co -mingled, it will be more difficult to evaluate the performance of the rates recommended as part of this study. Prepare a Cost -of -Service Rate Analysis: Because of the need to have a viable rate plan in place before construction of the treatment plant begins, this rate study has been limited to a revenue needs analysis. It is recommended that the City follow this study up with a full cost -of - service analysis to look at the individual components of the City's existing rate structure and verify each customer is being charged fairly. Update This Rate Study Frequently: After the implementation of any major change to the rate structure, we would suggest that the City monitor customer responses and system revenue for a period to two to three years. Following this initial observation period, the rates should be re- examined to determine if there should be any subsequent rate adjustments. A comprehensive review of this rate study should also be performed in three to five years. The projections, assumptions, and data contained in this report may need to be revised over time. For these reasons, it is prudent to update the rates to ensure they are sufficient to meet system requirements, as well as maintain cost -of -service equity in charges to customers. BOWEN, COLLINS & ASSOCIATES 1-10 MOAB CITY SEWER RATE STUDY $50.00 $45.00 $40.00 $35.00 s $30.00 $25.00 a� c S20.00 L S 15.00 $10.00 $5.00 $0.00 Figure 3 Comparison of Monthly Sever Rates, Average Residential Customer �� 4 z;Se 6.$1 4Z§t` 4 'FYE 2022 ratesfor other entities based on annual increasesto account for inflation only (396) 'Average bill based on an assumed 4,400galimonth use per residential customer 'Entities may charge taxesthat are not reflected in monthly bills BOWEN, COLLINS & ASSOCIATES Otis �a�1 a1q �O' Gti6 �� �� ,o °, C. ativ 4.% MOAB CITY APPENDIX A TECH MEMO #2: COST SHARE OF SYSTEM COSTS Bowen Collins tie, & Associates, Inc. CONSULTING ENGINEERS TECHNICAL MEMORANDUM it: February 2017 Update TO: David Everitt Moab City COPIES: File FROM: Keith Larson P.E. Jeff Beckman P.E. Bowen, Collins & Associates 154 East 14000 South Draper, Utah 84020 DATE: February 27, 2017 PROJECT: Sewer Rate Study SUBJECT: Cost Share of Future Sanitary Sewer System Costs INTRODUCTION Moab City (City) is in need of a new wastewater treatment plant. As part of the planning process for the plant improvements, the City has retained Bowen Collins & Associates (BC&A) to prepare a sewer rate study. The purpose of this study will be to help the City develop a sustainable rate plan to finance construction of the new plant and its subsequent operation. As part of this plan, it will be important to fairly distribute costs among the various users of the plant. The purpose of this memorandum is to examine the different types of future users that will benefit from the plant and calculate an appropriate cost share for each. This memorandum, originally completed on October 28, 2015, has been updated to reflect additional information obtained since that time. The additional information driving the update can be grouped into four categories: 1. Moab City O&M Budget: An updated Moab City 0&M budget has been made available to BC&A. The cost share model has updated to reflect that budget. 2. Impact Fees: In the original memorandum, impact fees were estimated based on information available at the time. Since October 2015, a new impact fee study has been completed and a new impact fee structure has been established. The cost share model has been updated to reflect those proposed impact fees. 3. Wastewater Treatment Plant Costs: Since October 2015, the wastewater treatment plant has been designed and bid. Thus, construction costs are now known and the loan interest rate is now known. The upfront cash contribution amounts of each entity dedicated to construction capital costs for the new wastewater treatment plant was not finalized in October 2015. The initial investment amounts have now been tentatively agreed upon. TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS 4. Updated Connection and Flow Data - The original memo was based on connection and flow data from 2014. To best reflect actual connections at the time of the potential treatment plant capacity agreement, all data was updated to reflect connections in August of 2016. PROPOSED COST SHARE APPROACH BC&A has analyzed the expected future costs associated with Moab City's wastewater system. This includes construction and future operation of the new wastewater treatment plant as well as the other operating and capital costs of the system. BC&A also met with and interviewed personnel from Moab City and Spanish Valley Water & Sewer Improvement District (SVW&SID) to gain insight into their priorities regarding how the system will be used and operated. Based on our discussions, we have identified the following objectives for division of future costs associated with operation of the wastewater system: 1. Moab City wants to maintain ownership of the new treatment plant. 2. The division of costs between entities should be as fair as possible based on the actual cost of service to each entity. 3. The final cost division should be as easy as possible to implement and administer. Based on these objectives, BC&A has assembled a proposed cost share approach for the Moab City wastewater system. The major components of the proposed approach are summarized in Table 1. The approach is discussed in detail in the following sections. Capital Costs There are two types of costs that must be divided between those who are using the system, capital costs and operation & maintenance costs. This section discusses capital costs. Capital costs can further be divided into treatment costs and collection system costs. Treatment. While not the only item of importance in this discussion, construction of a new treatment plant is the largest single issue that will affect future costs for Moab City. Construction of the plant will include two types of capacity: • Replacement of Existing Capacity - The existing Moab City plant currently provides treatment for up to 1.17 million gallons per day (mgd) of wastewater during the peak month of the year. There are also additional users that are currently constructing homes and businesses that will add additional flow to the plant increasing the total committed capacity to 1.19 mgd. Since the old plant will be abandoned, the new plant must have capacity to continue to serve these existing users. It is proposed that the portion of plant costs used to replace existing capacity be divided among existing users based on their actual use of committed capacity at the time the plant is constructed. In dividing these costs, several items should be considered: o Treatment Equivalency - When it comes to treatment capacity, it is not adequate to look at the portion of flow used by each entity only. The strength of wastewater must also be considered. This is especially true in Moab. The Moab plant has historically had a significant portion of its capacity used to receive septage from the several campgrounds and recreational areas in the vicinity of the City. This is expected to continue in the future. The strength of wastewater coming from BOWEN COLLINS & ASSOCIATES MOAB CITY 2 Table 1 Proposed Cost Share Matrix Cost Category Capital Costs Operations and Maintenace Cost Area Type of Costs Treatment Collecti n Treatment Collection Replacement of Existing Capacity Replacement of Existing Capacity System O&M System O&M Construction of Capacity for ers Construction of Capacity for How costs will be paid for? Cash on Hand and/or Use Charges** Impact Fees Use Charges Impact Fees Use Charges Use Charges What is the basis of total costs? Portion of new treatment plant costs required to serve existing users Portion of new treatment plant costs available to serve future users Annual collection system rehabilitation and replacement budget (1% system replacement) Projected costs of construction Annual treatment O&M per Moab budget Annual collection O&M per Moab budget How are costs divided? Proportional use of plant capacity based on treatment ERUs. The number of treatment ERUs are calculated based on the fomula established for each type of user in the ERU study (to be based on peak month flow and strength). Not divided between entities. Capacity is distributed based on a "first come, first serve" basis. As a result, the owner of the facility (Moab City) would carry all initial costs of this capacity, but would also receive all future revenue from related impact fees. Proportional use of Moab collection facilities based on flow ERUs. This will be calculated in two steps: 1. Use of each pipe calculated based on proportional flow ERUs conveyed in the pipe. 2. Contribution of each pipe to the overall system weighted by length times flow capacity of pipeline assuming State minimum slope (estimate of required O&M effort). Same as treatment capital costs for future capacity. Proportional use of plant capacity based on treatment ERUs Same as collection capital costs for existing capacity. When are costs divided? Calculated only once based on existing use of capacity. N/A Recalculated with each rate study (approximately once every 3 to 5 years). N/A Recalculated annually. Same as collection capital costs for existing capacity. Notes 1. Applies to initial 20-year period to pay for the new plant only. After the plant has been paid for, a treatment rehab and replacement budget will need to be established and costs split similar to treatment O&M. None. 1. The number of flow ERUs are calculated based on the fomula established for each type of user in the ERU study (to be based on peak month flow only). 2. ERU study to be updated periodically. 1. Collection impact fees will need to be calculated for at least two service areas. One for Moab only facilities and one for joint facilities. Only the joint facility fee will apply to users outside the City and be remitted to Moab. 1. ERU study to be updated periodically. Same as collection capital costs for existing capacity. ** Each entity will be asked to contribute cash on hand for some minimum percentage of their share of existing treatment costs (i.e. all entities contribute at least xx% of their portion of costs). This money can come from impact fees (pending results of legal review) or other reserves. The purpose of this contribution will be to minimize the amount of borrowing required by Moab City to construct the plant. If desired, each entity will also be allowed to contribute additional cash on hand to reduce their total liability for this cost category. If additional cash on hand is contributed, the entity's portion of the remaining bond costs will be reduced correspondingly TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS septage is 40 to 50 times greater than that of typical domestic wastewater and has a significant impact on the treatment process. To account for the full range of issues affecting treatment costs, BC&A would propose defining treatment demand for each entity (including septage) in terms of a treatment based equivalent resident unit (treatment ERU). This process is discussed in detail in a memorandum that has been included in the appendix of this report. Once the number of treatment ERUs has been defined for each entity, this can be used to calculate the proportionate use of existing capacity to be replaced. o Cash vs. Bonding - This cost category represents a large one-time expenditure for each entity. As a result, each entity will have some decisions to make regarding how to pay for their portion. To minimize the amount of bonding the City has to incur, each entity is planning to contribute cash on hand for a portion of their share of existing treatment costs. Moab City and SVW&SID have tentatively agreed to make upfront contributions in the amounts of $1,320,595 and $800,000, respectively. This money could come from impact fee balances (pending results of legal review) or other reserves. The remaining portion of each entity's cost liability will be put into a bond and paid for over time through annual user charges. If desired, each entity could be allowed to contribute additional cash on hand to reduce their total liability for this cost category. If additional cash on hand is contributed, the entity's portion of the remaining bond costs would be reduced correspondingly. o Rehabilitation and Replacement - It should be noted that this proposed cost share is for the initial construction costs of the treatment plant only. Since the plant will be brand new, this should represent the only required capital costs at the plant for the next several years. As the plant ages, however, a treatment plant rehabilitation and replacement budget will eventually need to be established. When this occurs, costs can be divided as discussed for treatment 0&M (to be discussed later). • Construction of Capacity for Future Users - The new treatment plant is expected to have a peak month, average day capacity of 1.75 mgd. This means that when the plant is completed, it is expected that there will be approximately 0.56 mgd of capacity available for future users. It is not anticipated that any entities will be reserving this future capacity in the treatment plant. Instead, future capacity will be distributed on a "first come, first serve" basis to be paid for through impact fees. Since Moab City will maintain ownership of the plant, it is expected that Moab City will be responsible to carry all debt associated with future capacity. However, this also means that Moab City will receive all future impact fees associated with treatment, regardless of where the fess are collected. It should be noted that this concept applies to both individual lot owners as well as other entities. For example, there are a large group of potential customers in San Juan County that currently have sewer service through septic systems. There has been some discussion of this group bringing their wastewater to Moab City. If this were to occur, Moab would require an agreement with San Juan County that would include the payment of impact fees sufficient to secure the capacity in the plant required to serve the new users. Collection. As with treatment, collection system capital costs will also include two types of capacity: BOWEN COLLINS &ASSOCIATES MOAB CITY 3 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS • Replacement of Existing Capacity - Sewer system collection pipelines have a finite lifespan and eventually need to be replaced. Paying for these costs becomes the responsibility of all who use capacity in the pipelines. It is proposed that these costs be divided using the following principles: o Flow Equivalency - BC&A would propose defining flow demand for each entity in terms of a flow based equivalent resident unit (flow ERU). This process is discussed in detail in a memorandum that has been included in the appendix of this report. In short, the flow ERU would be based on peak month projected flow for various types of users. This is in contrast to the alternative approach of defining flow based on average annual volume. Peak month flow is deemed a fairer basis of cost sharing than annual volume because the collection system must be sized based on peak flows. o Use of Facilities - While Moab customers generally benefit from the entire collection system, the same is not true for other entities. SVW&SID only uses capacity in a relatively small number of Moab's trunk lines to convey its wastewater to the plant. To account for this difference in the use of Moab collection facilities, it is proposed that the portion of use be calculated in two steps: 1. The percent usage of each pipe can be calculated based on proportional flow ERUs conveyed in the pipe (e.g. if SVW&SID has 400 ERUs in a pipe that is conveying 1,000 total ERUs, it would be assigned 40% of that pipe's capacity). 2. Once the capacity used in each pipeline is calculated, the second step is to calculate the contribution of each pipe to the overall system. This can be done by looking at a weighted use of capacity for all pipes in the system. It is proposed that the pipelines contribution to the system be weighted by the length of each pipe times its flow capacity assuming State minimum slope. Flow capacity is considered representative of the overall required maintenance effort associated with each pipe. Using the State minimum slope allows the system to be analyzed given limitations relative to actual pipe slope data. o Annual Costs - There are two possible approaches for determining collection system replacement costs. One approach would be to look at each replacement project individually and then determine the exact cost to each entity depending on which pipelines are being replaced. In addition to being extremely complicated, this approach has the added disadvantage of resulting in uneven costs for entities outside of Moab City. In some years, these entities may have no costs as the City focuses its efforts on replacement of pipelines serving only Moab City customers. In other years costs, the outside entities could be hit with extremely high costs when a major trunk line needed to be replaced. This creates problems for outside entities on two fronts. First, it makes it very difficult to set consistent sewer rates. Second, if the entity does not have enough money to fund a large project, it will be difficult to bond for the project since it is owned and will be constructed by Moab City. What appears to be a better approach is to charge a fixed amount to each outside entity based on their expected average annual portion of collection system replacement costs. In this case, Moab would collect the amount for each entity on a consistent basis and then spend the money as needed. If bonding was required for BOWEN COLLINS & ASSOCIATES MOAB CITY 4 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS particularly large projects, it could all be handled by Moab internally. The proposed budget amount would be initially set at 1% of the Moab system replacement value. Each entity would pay a portion of this based on its percent use of the overall system as discussed previously. The proposed budget equates to an average life span of 100 year for sewer system collection components. This is likely longer than can realistically be expected, but is a good rule of thumb for system renewal when asset management data is limited. o Periodic Recalculation - It is expected that the system value and each entity's use of the system will slowly change over time. As a result, it will be important to periodically re-examine each of these elements. It is proposed that these items be recalculated with each rate study (assumed to be once every 3 to 5 years) • Construction of Capacity for Future Users - Although not specifically identified at this time, it is expected that some additional pipeline projects will need to be constructed for the purpose of accommodating flow from future users. Similar to the treatment plant, it is not anticipated that any entities will be reserving future capacity in these pipelines. Instead, future capacity will be distributed on a "first come, first serve" basis to be paid for through impact fees. Since Moab City will maintain ownership of the pipeline, it is expected that Moab City will be responsible to carry all costs associated with future pipeline capacity. However, this also means that Moab City will receive all future impact fees associated with collection capacity inside the Moab City system, regardless of where the impact fees are collected. This does not mean that other entities cannot have their own collection impact fee. However, their fee will need to be separate from that collected for capacity inside the Moab collection system. Operation and Maintenance Costs The second major category of costs in the Moab City wastewater system is operation and maintenance (0&M) costs. As with capital costs, operation and maintenance costs can be divided into treatment costs and collection system costs. Treatment. It is proposed that operation and maintenance costs at the treatment plant be divided based on treatment equivalency as defined previously in the section regarding treatment capital costs. The only difference between capital costs and 0&M costs is that 0&M costs will be reexamined on an annual basis. Each year the total 0&M budget will be updated to reflect actual costs and the cost share will be updated to reflect the growth for each entity during the previous year. It should be emphasized that, under this approach, all entities would be charged a fixed amount each month based on the number and type of customers connected to the system. This is in contrast to a variable approach in which the amount charged each month is based on metered flow and strength. BC&A carefully considered both of these approaches. Ultimately charging a fixed amount each month was selected for the recommended approach because of several advantages: • Equitable Distribution of Costs - The basis of the fixed charge will be the treatment ERUs per entity as discussed above. These ERUs represent the expected demand of customers during peak demand periods. The great majority of sewer system costs are most closely tied to peak capacities. Peak demands determine the sizing of all capital equipment which, in turn, determines most maintenance costs. Peak demands also establish staffing costs, the BOWEN COLLINS & ASSOCIATES MOAB CITY 5 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS largest single expenditure associated with 0&M. In contrast, 0&M costs associated with the volume of wastewater produced are comparatively small (power consumption and some chemical costs). Given the two alternatives, charging based on peak demand is much more reflective of the true cost of service for each entity. • Revenue Stability - Fixed charges mean that revenue from outside entities will be consistent from month to month. This will help Moab City to plan and manage its annual budget. It also simplifies budgeting for outside entities since they can plan on a consistent expense for treatment from month to month. • Simplicity - Fixed charges are extremely easy to calculate and administer. All that is necessary is to keep track of the number and type of new connections each year so that ERU values for each entity can be updated annually. In contrast, charging variable rates requires accurate flow metering that all parties agree on. Depending on how the rates are structured, it may also require frequent sampling of wastewater from each entity to assign strength values. These additional complications can add significantly to the bottom line cost of operating the system. Collection. It is proposed that operation and maintenance costs for the collection system be divided in the same manner as defined previously in the section regarding collection replacement capital costs for existing capacity. CALCULATED COST SHARE BASED ON PROPOSED APPROACH Based on the approach described above, BC&A has assembled a cost share model for the Moab City wastewater system. The full, detailed model is contained in the appendix of this report. The following sections highlight the major results of the model. It should be noted that the model includes a year by year projection of shared system costs. This is a projection based on the best available information regarding development patterns. The actual cost share between entities will depend on actual system growth and may vary slightly from the results shown here. Equivalent Residential Units There are currently three types of users of the Moab City system: • Moab City customers • Customers from Spanish Valley Water & Sewer Improvement District (SVW&SID) • Septage Haulers Based on historic water use records, existing ERUs connected to the Moab sewer system (or ERUs for which capacity has been committed, i.e. projects that have already paid an impact fee but are not yet connected) are as summarized in Table 2. BOWEN COLLINS & ASSOCIATES MOAB CITY 6 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS Table 2 Existing ERUs Flow Treatment Customer Category Moab SVW&SID Septage Moab SVW&SID Septage Residential - Single Family 1,768 1,963 1,768 1,963 Residential - Multifamily 230 75 230 75 Overnight Accommodations 1,980 113 1,980 113 Commercial/Retail 603 94 603 94 Office 113 39 113 39 Restaurant 396 19 893 43 Schools 29 22 29 22 Gas Station/Convenience Store 88 93 88 93 RV/Campground 142 213 285 426 Other 118 76 38 118 76 1,372 Total 5,467 2,707 38 6,107 2,944 1,372 Percent of Total 66.6% 33.0% 0.5% 58.6% 28.2% 13.2% As can be seen in the table, Moab is responsible for approximately 2/3ras of the flow to the treatment with the other 1/3rd coming from SVW&SID. Septage is an insignificant contributor to overall flow. However, when strength is considered, septage is using 13.2 percent of the total treatment capacity. In addition to these existing customers, the model includes the following expected future users of the Moab City system: • USU - USU is currently exploring plans for further development of facilities for its Extension in Moab. Over the planning period (next 20 years), this is expected to add an average day flow of 144,500 gallons per day (166,175 gpd average day, peak month) to the total flow into Moab City. It is expected that USU will be a retail customer of SVW&SID and will add to their total flow. • San Juan County - Development in San Juan County is all currently on septic systems. At some point in the future, it is expected that additional capacity will be desired and that all development (both existing and future) will be brought to Moab's system. For the purpose of this analysis, it has been assumed that San Juan will have approximately 265 flow ERUs connecting to the system in 2020. If San Juan connects, it is expected that the County will be a new wholesale customer (i.e. not a retail customer of either Moab or SVW&SID). Based on the new customers described above and projected growth rates for existing customers, projected ERUs to be connected to the Moab sewer system are as summarized in Table 3. BOWEN COLLINS &ASSOCIATES MOAB CITY 7 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS Table 3 Projected ERUs - 2035 Flow Treatment Year Moab SVW&SID* Septage San Juan Moab SVW&SID* Septage San Juan 2017 5,467 2,707 38 0 6,107 2,944 1,372 0 2022 5,774 3,259 47 277 6,450 3,590 1,687 301 2027 6,099 3,907 55 308 6,813 4,354 2,002 334 2032 6,442 4,588 64 342 7,196 5,152 2,316 372 2035 6,657 5,014 69 365 7,436 5,649 2,505 397 *Includes projected flows from USU Extension. Use of Moab Wastewater Collection System As discussed previously, customers outside of Moab City will only use a portion of the wastewater collection system. Following the procedure discussed above, SVW&SID's current weighted use of the Moab Collection System is summarized in Table 4. Table 4 SVW&SID's Current Weighted Use of Moab's Collection System Size (in) Total Length (ft) Weighted Capacity* (ft-cfs) SVW&SID Proportional Use of Capacity SVW&SID Weighted Capacity* Moab Weighted Capacity* 6 37,658 14,981 0.0% - 14,981 8 99,656 76,368 1.3% 1,006 75,362 9 729 695 0.0% - 695 10 11,071 12,869 7.1% 910 11,959 12 7,857 13,165 76.6% 10,090 3,075 15 3,601 9,032 14.1% 1,277 7,756 18 10,106 36,874 22.1% 8,139 28,735 21 1,125 5,653 0.0% - 5,653 24 745 4,782 49.3% 2,359 2,423 30 1,050 10,401 35.0% 3,636 6,765 3 (Force Main) 2,536 871 0.0% - 871 4 (Force Main) 827 505 0.0% - 505 Total 176,960 186,197 27,417 158,780 SVW&SID Current Use of Collection System 14.7% SVW&SID Current Portion of Total Flow 31.4% SVW&SID Proportional Use of Collection System Capacity 46.9% *Weighted capacity based on total length times the capacity of each pipeline at the State minimum slope. Capacity for force mains based on velocity of 7 ft/sec. As is summarized in the table, SVW&SID only uses 14.7 percent of the collection system capacity, even though it accounts for 31.4 percent of the total flow. This means that SVW&SID's use of the collection system is only 46.9 percent of its proportional contribution of flow. BOWEN COLLINS & ASSOCIATES MOAB CITY 8 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS Cost Share Model Results Results from the cost share model are summarized in Tables 5 through 7. Tables 5 and 6 provide a summary of the percent of cost associated with each entity over time for collection and treatment costs, respectively. Table 7 provides the projected cost share for the new treatment plant assuming completion of the plant in 2018. Table 5 Projected Cost Share - Collection System Costs* Year Moab SVW&SID** Septage San Juan 2017 84.5% 15.5% 0% 0% 2022 82.3% 16.3% 0% 1.4% 2027 80.9% 17.7% 0% 1.4% 2032 79.7% 18.8% 0% 1.4% 2035 79.2% 19.4% 0% 1.4% *Projected future costs are estimates based on current growth nroiections. Actual cost share will be recalculated as described in this memorandum based on actual system growth and development. **Includes projected flows from USU Extension. Table 6 Projected Cost Share - Treatment Costs* Year Moab SVW&SID** Septage San Juan 2017 58.6% 28.2% 13.2% 0% 2022 53.6% 29.8% 14.0% 2.5% 2027 50.4% 32.2% 14.8% 2.5% 2032 47.9% 34.3% 15.4% 2.5% 2035 46.5% 35.3% 15.7% 2.5% *Projected future costs are estimates based on current growth nroiections. Actual cost share will be recalculated as described in this memorandum based on actual system growth and development. **Includes projected flows from USU Extension. Table 7 Projected Cost Share - Treatment Plant Construction Costs Entity Total Cost Portion of Total Moab $6,243,364 38.25% SVW&SID $3,009,737 18.44% Septage $2,557,307 15.69% San Juan $0 0% Future Growth $4,510,188 27.63% Total $16,320,595 100% As can be seen in the tables, the current model shows costs slowly shifting away from Moab City and onto other users. This is the result of higher projected growth rates for development outside of the City. However, as noted above, the values contained in these tables are only projections based on estimated of future development patterns. The actual cost share between entities in future years will depend on actual system growth and may vary slightly from the results show here. In future BOWEN COLLINS & ASSOCIATES MOAB CITY 9 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS years, it is expected that the projections in the rate model will be replaced with actual values for each entity to more accurately calculate the appropriate cost share and corresponding rates. Approximate Wastewater Rates The primary focus of this memorandum has been the development of cost share calculations to divide costs between the several entities. It does include the information to perform a comprehensive rate study and calculate detail rates for each entity. However, based on information provided by each entity regarding historic rates and annual revenues, it is possible to estimate approximate monthly rates for each of the entities as shown in Tables 8. The monthly rates estimated in Table 8 take into account the initial capital investment that each entity has agreed to pay towards construction of the wastewater treatment plant and assumes securing a loan for the remaining capital costs. Table 8 Approximate Residential Future Wastewater Rates - Moab Portion of Bill Only Year Moab ($/month) SVW&SID ($/month) Septage ($/gallon) Historic $16.90 $7.70 $0.09 2020 $35.16 $14.10 $0.20 2025 $36.81 $14.43 $0.19 2030 $39.20 $15.09 $0.18 2035 $41.99 $16.00 $0.18 It should be emphasized that these costs are for the Moab City portion of each bill only. For Moab residents, this represents their full sewer bill. For other entities, however, there will be additional costs for the operation and maintenance of their individual collection systems. In both of the tables, it is noted that the amount of increase from year to year is not consistent between entities. There are even decreases in some cases. This is a result of the differing growth rates between entities and their ratio of treatment plant costs to other costs. For example, in the case of septage customers, all of their costs are associated with treatment and they have a higher than average projected growth rate. As a result, the projected growth allows the initial construction costs of the plant to be distributed over an increasing number of users over time. This results in a small decrease in the cost per customer over time. Conversely, treatment costs in Moab are a much smaller portion of total costs and it has the lowest expected growth rate. This means that inflation associated with collection system and other costs overshadows any reduction in treatment plant payments and the overall rate increases gradually over time. CONCLUSIONS AND RECOMMENDATIONS This memorandum provides a proposed approach to sharing costs in the Moab wastewater system, including construction of a new treatment plant. It is recommended that Moab City review the proposed approach with all potential stakeholders in the treatment project to collect input and finalize the approach. This will become the basis for a final agreement between the various entities. Specific items that should be reviewed and agreed upon should include: 1. Moab continued ownership of treatment plant 2. First come, first serve policy for future capacity 3. ERU calculation policy - Both flow and treatment based BOWEN COLLINS & ASSOCIATES MOAB CITY 10 TECHNICAL MEMORANDUM #2: COST SHARE OF SYSTEM COSTS 4. Use of fixed monthly charges to each entity based on flow and treatment ERUs instead of variable monthly charges based on volume and strength measurements 5. Final agreement on cash contributions toward initial treatment plant construction costs to be contributed by each entity 6. How septage will fund its required portion of treatment plant construction costs (initial payment vs. incorporated into future rates) Once the cost share principles discussed in this memorandum are finalized and adopted, BC&A will be able to calculate specific rates for Moab City customers in greater detail. BOWEN COLLINS & ASSOCIATES MOAB CITY 11 Appendix A ERU Calculation Memorandum Bowen Collins 36.., & Associates, Inc. CONSULTING ENGINEERS TECHNICAL MEMORANDUM # 1 TO: Rebecca Davidson Moab City COPIES: File FROM: Keith Larson P.E. Jeff Beckman P.E. Bowen, Collins & Associates 154 East 14000 South Draper, Utah 84020 DATE: September 21, 2016 PROJECT: Sewer Rate Study SUBJECT: Residential Equivalent Study INTRODUCTION Bowen Collins & Associates (BC&A) has been retained by Moab City (City) to do a study on equivalent residential units (ERUs) for the City. An ERU is the typical water use amount for a single family residence measured in gallons per day or gallons per month. This represents the average flow and strength of wastewater for a residential connection to the City. The purpose of this study is to create a basis for the City to relate flow from larger non-residential customers to the flow of an average residential connection or ERU. By defining the flow of all the different customer types in terms of ERUs, the City will be able equally allocate the costs of service in the sewer system to the various system users. This memorandum examines the basis of an ERU in the City and proposes a method of ERU calculation for different customer types. ERU DEFINITION The definition of an ERU should be defined based on the average characteristics of a single family residential connection. Based on water use records for 2016, the average residential connection had indoor water use of approximately 4,400 gallons during the peak month of the year. Historically, the City has used an expected domestic wastewater concentration of 300 mg/L when calculating Biological Oxygen Demand (BOD) loading and 280 mg/L when calculating Total Suspended Solids (TSS) loading. Based on this information, the following definitions and equations are proposed to calculate the number of ERUs for different customer types. To accurately reflect the impact of customers on both collection and treatment facilities, ERUs will be defined in terms of both flow and strength. Fractional ERU values are rounded up to the next whole number. TECHNICAL MEMORANDUM #1 : RESIDENTIAL EQUIVALENT STUDY ERU Definition Based on Flow (1) 1 ERUflow = 4,400 gal/month ERU Definition Based on BOD (2) 1 ERUBOD = 300 mg/L x (8.345 x 10-61bs L/mg gal ) x 4,400 gal/month 1 ERUBOD = 11.0 lbs/month ERU Definition Based on TSS (3) 1 ERUTss = 280 mg/L x (8.345 x 10-61bs L/mg gal ) x 4,400 gal/month 1 ERUTss = 10.31bs/month Equation to Calculate ERU Value Based on Flow (4) # of ERUflow = Customer Flow gal/month 4,400 gal/month per RE Equation to Calculate ERU Value Based on BOD (5) # of ERUBOD = BODcon, mg/L x (8.345 x 10-6) x Cust. Flow gal/month 11.0 lbs/month per ERU Equation to Calculate ERU Value Based on TSS (6) # of ERUTss = TSS., mg/L x (8.345 x 10-6) x Customer Flow gal/month 10.31bs/month per ERU Equation to Calculate Number of Treatment ERUs Based on Cost Weighted Average of Flow, BOD, & TSS (7) # of Treatment ERUwtAve = (ERUflow x 33.3%) + (ERUBOD x 33.3%) + (ERUTss x 33.3%) The cost weighted average approach described above takes the estimated percentage spent by the City on treatment based on total flow, BOD, and TSS and calculates a weighted ERU value. For this study, costs have been divided evenly between the three categories'. 1 To develop a more refined estimate of actual costs would require a full cost -of -service analysis of the detailed design of the new treatment plant and its subsequent operation costs. Since this data will not be available for several years, the costs have been approximated as shown. These are believed to be relatively accurate estimates based on costs as observed at other established plants. A cost analysis of the Central Valley Water Reclamation Facility in Salt Lake City, Utah calculated costs at 30% flow, 31% BOD, and 39% TSS. A similar analysis of the Timpanogos Wastewater Treatment Plant in Pleasant Grove, Utah calculated costs at 560/0 flow, 24% BOD, and 20% TSS. While costs will vary from plant to plant depending on the treatment process used and the quality of wastewater being received, the estimate contained here seems reasonable in the absence of additional data. BOWEN COLLINS & ASSOCIATES MOAB CITY 2 TECHNICAL MEMORANDUM #1 : RESIDENTIAL EQUIVALENT STUDY CUSTOMER ERU CATEGORIES Based on the City's current customer billing types, BC&A would propose ten different customer categories for defining ERUs as identified in Table 1. Table 1 Proposed ERU Customer Categories Customer Category Notes Residential - Single Family Includes typical single family residential along with trailers, town homes, duplexes, and large multifamily (see below). Residential - Multifamily Includes all apartments and condos up to a maximum size of 1,500 square feet per unit. All larger multifamily to be grouped with single family residential. Overnight Accommodations Any overnight accommodations with sewer service including hotels, motels, and bed & breakfasts. Commercial/Retail Office Restaurant Any business whose primary function is to prepare and serve food (including fast food). Schools Gas Station/Convenience Store RV/Campground Other Any development that is not adequately represented by one of the categories above. Could include medical, churches, car washes, laundromats, etc. ERU CATEGORY CALCULATIONS For the proposed customer categories listed above, BC&A has developed a recommended definition for both Flow ERUs and Treatment ERUs as summarized in Table 2. Definitions for Flow ERUs in this table are based on historic flow data as available from 2016 water use records for Moab City customers. Flow equivalency has been based on estimated peak month indoor water use as approximated from April 2016 water use. Because water quality data is not readily available for the various Moab City customer categories, Treatment ERUs have been based on data collected as part of a detailed water quality study completed by BC&A for Mt. Olympus Improvement District completed in 2012. Historical data used to assemble the results are contained in Appendix A. BOWEN COLLINS &ASSOCIATES MOAB CITY 3 TECHNICAL MEMORANDUM #1 : RESIDENTIAL EQUIVALENT STUDY Table 2 Proposed ERU Definitions by Customer Category Customer Type Flow Only Definition 1ERU = Treatment Definition 1ERU = Residential - Single Family 1 residence 1 residence Residential - Multifamily 1.8 units 1.8 units Overnight Accommodations 1.2 units 1.2 units Commercial/Retail 6,500 ft2 6,500 ft2 Office 4,000 ft2 4,000 ft2 Restaurant 10.6 Seats 4.7 Seats Schools 15 Students 15 Students Gas Station/Convenience Store 3,600 ft2 3,600 ft2 RV/Campground By Study By Study Other By Study By Study It is recommended that the definitions proposed in Table 2 be used to calculate the number of Flow and Treatment ERUs in the Moab, Spanish Valley Water & Sewer Improvement District, and other systems. This can be accomplished as outlined in Equation (8). Equation to Calculate Number of ERUs Based on ERU Definition (8) Number of ERUs = Customer Facility Size (ft2, # seats, etc.) ERU Definition BOWEN COLLINS & ASSOCIATES MOAB CITY 4 Moab Historical Water Use by Customer Category (2016) Residential - Single Family 1 Residential 2 Residential Trailer Courts Trailer Court/House Trailer Court/2 Apts/House County Residential Total Connections 1365 11 12 1 2 12 1403 Units 1368 18 349 3 22 12 1772 Quantity (Peak Month) - kgals 6019.2 79.2 1490.5 30.0 108.0 52.8 7779.741787 Peak Month Indoor Water consumption kgals 4.40 4.40 4.27 10.00 4.91 4.40 4.39 Peak Month Indoor Water consumption gpd 144.7 144.7 140.4 328.8 161.4 144.7 144.3 ERUs 1368.0 18.0 338.8 6.8 24.5 12.0 1768.1 Residential - Multifamily House/Apartments 8 16 39.1 2.4 80.4 8.9 Apartments 77 398 972.9 2.4 80.4 221.1 Total 85 414 1012 2.4 80.4 230.0 Overnight Accommodations Hotel/Motel/B&B 64 2393.1 8774.9 3.7 120.5 1994.3 Bed & Breakfast 52.94 2 2 2.0 1.0 32.9 0.5 Restaurant Correction -5 -5 -64.9 " ^ "" ' Total 61 2390.142857 8711.957143 3.6 119.8 1980.0 Commercial/Retail Business/House 6 11 104.0 9.5 310.8 23.6 Business 138 138 3277.2 23.7 780.8 744.8 Business - 4 month water usage 6 7 22.3 3.2 104.6 5.1 County Business 1 1 6.0 6.0 197.3 1.4 2 Commercial 1 2 2.0 1.0 32.9 0.5 Restaurant Correction -9 -9 -132.2 -14.7 -482.9 -30.0 RV/Campground Correction -3 -3 -626.1 -208.7 -6861.4 -142.3 Total 140 147 2653.209368 -180.0 -5918.0 603.0 Office Office Space Rental 24 24 556.0 23.2 761.6 126.4 Restaurant Correction -4 -4 -57.8 - -2 -13.1 Total 20 20 498.2 24.9 819.0 113.2 Restaurant Restaurant/Bar 23 23 1461.0 63.5 2088.4 332.0 Restaurant/Bar Billed Under Other Categories 20 20 281.3 14.1 462.4 63.9 Total 43 43 1742.3 40.5 1332.1 396.0 Schools School 7 7 97.0 13.9 455.6 22.0 School - 4 month winter usage 6 6 31.0 5.2 169.9 7.0 Total 13 13 128 9.8 323.7 29.1 Gas Station/Convenience Store Gas Station/Convenience Store 6 6 411.4 68.6 2254.4 93.5 Restaurant Correction -2 -2 -26.4 -13.2 -434.0 -6.0 Total 4 4 385.0 96.3 3164.6 87.5 RV/Campground RV/Campground Billed Other Categories 3 3 626.1 208.7 6861.4 142.3 Total 3 3 626.1 208.7 6861.4 142.3 Other Church 1 1 1.0 1.0 32.9 0.2 Church - 4 months Winter Usage 8 8 57.0 7.1 234.2 13.0 Govt - 4 month winter usage 3 3 10.0 3.3 109.6 2.3 Medical Office 4 4 21.0 5.3 172.6 4.8 Hospital 3 3 431.0 143.7 4723.3 98.0 Total 19 19 520 27.4 899.8 118.2 Totals Residential - Single Family Other Total 1403 1772 7779.741787 4.4 144.3 1768.1 388 3053.142857 16276.79508 5.3 175.3 3699.3 1791 4825.142857 24056.53687 5.0 163.9 5467.4 SVW&SID Historical Water Use by Customer Category (2016, including commited but not yet connected) Residential - Single Family Connections Units Quantity (Peak Month) - kgals Peak Month Indoor Water consumption kgals Peak Month Indoor Water consumption gpd ERUs Residential 1851 1851 8144.4 4.4 144.7 1851.0 Trailer Court 8 112.0 493 4.4 144.7 112.0 Total 1859 1963.0 8637.4 4.4 144.7 1963.0 Residential - Multifamily All 16 135 330 2.4 80.4 75.0 Total 16 135 330 2.4 80.4 75.0 Overnight Accommodations All 6 135.5 497 3.7 120.5 113.0 Total 6 135.5 497 3.7 120.5 113.0 Commercial/Retail All 60 60 414.25 6.9 227.0 94.1 Total 60 60 414.25 6.9 227.0 94.1 Office All 17 17 170.4 10.0 329.5 38.7 Total 17 17 170.4 10.0 329.5 38.7 Restaurant All 3 3 83 27.7 909.6 18.9 Total 3 3 83 27.7 909.6 18.9 Schools All 2 2 95 47.5 1561.6 21.6 Total 2 2 95 47.5 1561.6 21.6 Gas Station/Convenience Store All 3 3 410 136.7 4493.2 93.2 Total 3 3 410 136.7 4493.2 93.2 RV/Campground All 7 430 938 2.2 71.7 213.2 Total 7 430 938 2.2 71.7 213.2 Other All 25 25 334.6 13.4 440.0 76.0 Total 25 25 334.6 13.4 440.0 76.0 Totals Residential - Single Family Other Total Connections 1859 1963.045455 8637.4 4.4 144.7 1963.0 139 810.5454545 3272.25 4.0 132.7 743.7 1998 2773.590909 11909.65 4.3 141.2 2706.7 Appendix B Cost Share Model Moab City Wastewater System - Cost Share Model Projected Year FYE 2015 FYE 2016 FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035 Moab Sewer Flows (MGD) 0.77 0.78 0.79 0.80 0.81 0.82 0.83 0.84 0.85 0.85 0.86 0.87 0.88 0.89 0.90 0.91 0.92 0.93 0.94 0.95 0.96 GWSSA Sewer Flows (MGD) 0.38 0.38 0.39 0.40 0.41 0.42 0.42 0.43 0.44 0.45 0.46 0.47 0.48 0.49 0.50 0.51 0.52 0.53 0.54 0.55 0.56 USU Sewer Flows (MGD) 0.00 0.00 0.00 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09 0.10 0.11 0.12 0.13 0.14 0.15 0.16 0.166175 San Juan Sewer Flows (MGD) 0.00 0.00 0.00 0.00 0.00 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.05 0.05 0.05 0.05 0.05 0.05 0.05 0.05 Septage Sewer Flows (MGD) 0.004992 0.005244 0.005496 0.005748 0.006000 0.006252 0.006504 0.006756 0.007009 0.007261 0.007513 0.007765 0.008017 0.008269 0.008521 0.008773 0.009025 0.009277 0.009529 0.009781 0.010033 Committed Sewer Flows - Peak Month, Ave. Day ill 1.16 1.17 1.19 1.21 1.23 1.30 1.33 1.35 1.38 1.41 1.44 1.47 1.50 1.53 1.56 1.59 1.62 1.66 1.69 1.72 1.75 Moab Flow ERUs 5,349 5,408 5,467 5,527 5,588 5,649 5,712 5,774 5,838 5,902 5,967 6,033 6,099 6,166 6,234 6,303 6,372 6,442 6,513 6,584 6,657 GWSSA Flow ERUs 2,602 2,654 2,707 2,761 2,816 2,873 2,930 2,989 3,049 3,109 3,172 3,235 3,300 3,366 3,433 3,502 3,572 3,643 3,716 3,790 3,866 USU Flow ERUs 0 0 0 0 68 135 203 270 338 405 473 540 608 675 743 810 878 945 1,013 1,080 1,148 San Juan Flow ERUs 0 0 0 0 0 265 271 277 283 289 295 301 308 314 321 328 335 342 350 357 365 Septage Flow ERUs 34 36 38 40 41 43 45 47 48 50 52 54 55 57 59 61 62 64 66 68 69 Total Flow ERUs 7,985 8,098 8,212 8,328 8,513 8,966 9,160 9,357 9,555 9,756 9,958 10,163 10,370 10,579 10,790 11,003 11,219 11,437 11,657 11,880 12,105 Moab Treatment ERUs 5,975 6,041 6,107 6,174 6,242 6,311 6,380 6,450 6,521 6,593 6,666 6,739 6,813 6,888 6,964 7,040 7,118 7,196 7,275 7,355 7,436 GWSSA Treatment ERUs 2,830 2,886 2,944 3,003 3,063 3,124 3,187 3,250 3,315 3,382 3,449 3,518 3,589 3,660 3,734 3,808 3,885 3,962 4,041 4,122 4,205 USU Treatment ERUs 0 0 0 0 85 170 255 340 425 510 595 680 765 850 935 1,020 1,105 1,190 1,275 1,360 1,445 San Juan Treatment ERUs 0 0 0 0 0 288 295 301 307 314 321 328 335 342 349 357 364 372 380 388 397 Septage Treatment ERUs 1,246 1,309 1,372 1,435 1,498 1,561 1,624 1,687 1,750 1,813 1,876 1,939 2,002 2,065 2,127 2,190 2,253 2,316 2,379 2,442 2,505 Total Treatment ERUs 10,051 10,236 10,423 10,612 10,888 11,454 11,740 12,029 12,319 12,611 12,906 13,203 13,503 13,805 14,109 14,416 14,725 15,037 15,351 15,668 15,987 Moab Growth Rate 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% 1.1% GWSSA Growth Rate 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% USU Growth Rate - NA NA NA #DIV/0! 100.0% 50.0% 33.3% 25.0% 20.0% 16.7% 14.3% 12.5% 11.1% 10.0% 9.1% 8.3% 7.7% 7.1% 6.7% 6.3% San Juan Growth Rate 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% 2.1% Septage Growth Rate 5.0% 4.8% 4.6% 4.4% 4.2% 4.0% 3.9% 3.7% 3.6% 3.5% 3.4% 3.2% 3.1% 3.0% 3.0% 2.9% 2.8% 2.7% 2.6% 2.6% Overall % Growth from Previous Year 1.41% 1.41% 1.41% 2.22% 5.31% 2.17% 2.15% 2.12% 2.10% 2.08% 2.06% 2.03% 2.02% 2.00% 1.98% 1.96% 1.94% 1.93% 1.91% 1.90% Expenditures O&M - Collection $210,000 $217,781 $401,000 $415,863 $432,965 $457,454 $476,141 $495,532 $515,654 $536,534 $558,201 $580,683 $604,011 $628,217 $653,333 $679,393 $706,433 $734,489 $763,598 $793,801 $825,137 O&M - Treatment $315,000 $327,353 $583,000 $720,775 $751,768 $793,870 $827,597 $862,581 $898,869 $936,509 $975,550 $1,016,045 $1,058,048 $1,101,615 $1,146,802 $1,193,670 $1,242,281 $1,292,699 $1,344,991 $1,399,225 $1,455,473 Capital Expenditures - Collection (R&R) $492,325 $512,673 $450,000 $463,500 $477,405 $491,727 $506,479 $521,673 $537,324 $553,443 $570,047 $587,148 $604,762 $622,905 $641,592 $660,840 $680,665 $701,085 $722,118 $743,781 $766,095 Capital Expenditures - Collection Expansion $0 $0 $83,891 $85,067 $122,043 $263,813 $127,503 $128,818 $130,153 $131,509 $132,886 $134,285 $135,707 $137,150 $138,617 $140,106 $141,620 $143,157 $144,719 $146,305 $147,917 Capital Expenditures - Treatment $0 $0 $14,200,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 ($14,200,000) $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 $798,834 Total Expenditures $1,017,325 $1,057,807 $1,517,891 $2,484,039 $2,583,015 $2,805,698 $2,736,554 $2,807,438 $2,880,834 $2,956,829 $3,035,518 $3,116,996 $3,201,362 $3,288,721 $3,379,178 $3,472,844 $3,569,833 $3,670,264 $3,774,260 $3,881,947 $3,993,457 Allocation of Collection Costs Moab 84.7% 84.6% 84.5% 84.5% 84.1% 82.9% 82.6% 82.3% 82.0% 81.7% 81.5% 81.2% 80.9% 80.7% 80.5% 80.2% 80.0% 79.8% 79.6% 79.4% 79.2% GWSSA (Including USU) 15.3% 15.4% 15.5% 15.5% 15.9% 15.7% 16.0% 16.3% 16.6% 16.9% 17.2% 17.4% 17.7% 17.9% 18.1% 18.4% 18.6% 18.8% 19.0% 19.2% 19.4% San Juan 0.0% 0.0% 0.0% 0.0% 0.0% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% 1.4% Septage 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% Total 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Allocation of Treatment Costs Moab 59.4% 59.0% 58.6% 58.2% 57.3% 55.1% 54.3% 53.6% 52.9% 52.3% 51.6% 51.0% 50.5% 49.9% 49.4% 48.8% 48.3% 47.9% 47.4% 46.9% 46.5% GWSSA (Including USU) 28.2% 28.2% 28.2% 28.3% 28.9% 28.8% 29.3% 29.8% 30.4% 30.9% 31.3% 31.8% 32.2% 32.7% 33.1% 33.5% 33.9% 34.3% 34.6% 35.0% 35.3% San Juan 0.0% 0.0% 0.0% 0.0% 0.0% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% Septage 12.4% 12.8% 13.2% 13.5% 13.8% 13.6% 13.8% 14.0% 14.2% 14.4% 14.5% 14.7% 14.8% 15.0% 15.1% 15.2% 15.3% 15.4% 15.5% 15.6% 15.7% Total Costs 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Page 1 of 3 Moab City Wastewater System - Cost Share Model Projected Year FYE 2015 FYE 2016 FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035 Moab Expenditures O&M - Collection $177,926 $184,325 $339,040 $351,234 $364,216 $379,177 $393,213 $407,764 $422,849 $438,487 $454,699 $471,503 $488,924 $506,981 $525,699 $545,102 $565,213 $586,060 $607,667 $630,064 $653,278 O&M - Treatment $187,254 $193,177 $341,580 $419,345 $430,983 $437,379 $449,746 $462,561 $475,837 $489,589 $503,831 $518,579 $533,850 $549,660 $566,027 $582,968 $600,503 $618,651 $637,433 $656,869 $676,981 Capital Expenditures - Collection (R&R) $417,130 $433,915 $380,469 $391,468 $401,600 $407,585 $418,267 $429,275 $440,619 $452,306 $464,348 $476,753 $489,532 $502,695 $516,253 $530,216 $544,597 $559,407 $574,658 $590,362 $606,533 Capital Expenditures - Collection Expansion $0 $0 $83,891 $85,067 $122,043 $263,813 $127,503 $128,818 $130,153 $131,509 $132,886 $134,285 $135,707 $137,150 $138,617 $140,106 $141,620 $143,157 $144,719 $146,305 $147,917 Capital Expenditures - Treatment $0 $0 $4,922,769 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 ($4,922,769) $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 $299,038 Total Moab Expenditures $782,309 $811,417 $1,144,979 $1,546,151 $1,617,881 $1,786,992 $1,687,767 $1,727,456 $1,768,496 $1,810,930 $1,854,802 $1,900,160 $1,947,051 $1,995,525 $2,045,633 $2,097,430 $2,150,971 $2,206,313 $2,263,515 $2,322,639 $2,383,748 GWSSA Expenditures O&M - Collection $32,074 $33,456 $61,960 $64,629 $68,748 $71,934 $76,328 $80,899 $85,655 $90,604 $95,753 $101,111 $106,686 $112,486 $118,521 $124,799 $131,332 $138,128 $145,199 $152,554 $160,207 O&M - Treatment $88,683 $92,303 $164,665 $203,953 $217,347 $228,308 $242,605 $257,467 $272,920 $288,986 $305,693 $323,067 $341,135 $359,925 $379,468 $399,793 $420,934 $442,922 $465,792 $489,581 $514,323 Capital Expenditures - Collection (R&R) $75,195 $78,758 $69,531 $72,032 $75,805 $77,324 $81,191 $85,166 $89,254 $93,459 $97,785 $102,237 $106,818 $111,535 $116,391 $121,391 $126,542 $131,846 $137,311 $142,942 $148,743 Capital Expenditures- Collection Expansion $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures - Treatment $0 $0 $2,209,737 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 ($2,209,737) $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 $102,207 Total GWSSA Expenditures $195,953 $204,518 $296,157 $442,821 $464,107 $479,774 $502,331 $525,740 $550,036 $575,257 $601,439 $628,622 $656,846 $686,153 $716,587 $748,191 $781,014 $815,104 $850,510 $887,284 $925,480 San Juan Expenditures O&M - Collection $0 $0 $0 $0 $0 $6,343 $6,600 $6,869 $7,150 $7,443 $7,749 $8,068 $8,402 $8,749 $9,113 $9,492 $9,888 $10,301 $10,732 $11,182 $11,653 O&M - Treatment $0 $0 $0 $0 $0 $19,990 $20,768 $21,581 $22,430 $23,317 $24,244 $25,212 $26,223 $27,279 $28,382 $29,534 $30,737 $31,993 $33,306 $34,676 $36,108 Capital Expenditures - Collection (R&R) $0 $0 $0 $0 $0 $6,818 $7,021 $7,232 $7,451 $7,678 $7,913 $8,158 $8,412 $8,675 $8,949 $9,233 $9,527 $9,832 $10,149 $10,478 $10,819 Capital Expenditures- Collection Expansion $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures - Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total San Juan Expenditures $0 $0 $0 $0 $0 $33,151 $34,390 $35,682 $37,031 $38,438 $39,906 $41,438 $43,036 $44,704 $46,443 $48,258 $50,151 $52,126 $54,187 $56,337 $58,579 • •,157 $44 ,: $512,925 $50,011111..1 $641,345 11670,060I Septage Expenditures O&M - Collection $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 O&M - Treatment $39,063 $41,873 $76,755 $97,478 $103,438 $108,193 $114,478 $120,972 $127,682 $134,616 $141,782 $149,188 $156,841 $164,751 $172,926 $181,376 $190,108 $199,133 $208,460 $218,099 $228,061 Capital Expenditures - Collection (R&R) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures- Collection Expansion $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures - Treatment $0 $0 $2,557,307 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 ($2,557,307) $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 $143,864 Total Septage Expenditures $39,063 $41,873 $76,755 $241,341 $247,302 $252,057 $258,342 $264,836 $271,546 $278,480 $285,646 $293,051 $300,705 $308,615 $316,790 $325,239 $333,972 $342,996 $352,324 $361,963 $371,925 Future Growth Expenditures O&M - Collection $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 O&M - Treatment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures - Collection (R&R) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures- Collection Expansion $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Capital Expenditures - Treatment $0 $0 $4,510,188 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Debt Service $0 $0 ($4,510,188) $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 Total Future Growth Expenditures $0 $0 $0 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 Check: Expenditures = Total? $0 $0 $0 $0 $0 ($0) $0 $0 ($0) $0 $0 ($0) ($0) $0 $0 $0 $0 $0 $0 $0 $0 Impact Fees (Moab) Income - Collection $ - $ - $ 83,891 $ 85,067 $ 122,043 $ 263,813 $ 127,503 $ 128,818 $ 130,153 $ 131,509 $ 132,886 $ 134,285 $ 135,707 $ 137,150 $ 138,617 $ 140,106 $ 141,620 $ 143,157 $ 144,719 $ 146,305 $ 147,917 Income -Treatment $ 37,864 $ 37,864 $ 104,678 $ 106,427 $ 205,960 $ 539,535 $ 216,737 $ 218,767 $ 220,834 $ 222,938 $ 225,081 $ 227,263 $ 229,485 $ 231,747 $ 234,050 $ 236,396 $ 238,784 $ 241,216 $ 243,693 $ 246,214 $ 248,782 Expenditures -Collection $0 $0 $ 83,891 $ 85,067 $ 122,043 $ 263,813 $ 127,503 $ 128,818 $ 130,153 $ 131,509 $ 132,886 $ 134,285 $ 135,707 $ 137,150 $ 138,617 $ 140,106 $ 141,620 $ 143,157 $ 144,719 $ 146,305 $ 147,917 Expenditures - Treatment $0 $0 $0 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 $253,725 Net Impact Fees $ - $ - $ 104,678 $ (147,297) $ (47,765) $ 285,810 $ (36,988) $ (34,958) $ (32,891) $ (30,786) $ (28,644) $ (26,462) $ (24,240) $ (21,978) $ (19,674) $ (17,329) $ (14,941) $ (12,509) $ (10,032) $ (7,510) $ (4,942) Page 2 of 3 Moab City Wastewater System - Cost Share Model Projected Year FYE 2015 FYE 2016 FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2022 FYE 2023 FYE 2024 FYE 2025 FYE 2026 FYE 2027 FYE 2028 FYE 2029 FYE 2030 FYE 2031 FYE 2032 FYE 2033 FYE 2034 FYE 2035 Cost Per ERU Moab O&M - Collection $33.27 $34.09 $62.02 $63.55 $65.18 $67.12 $68.85 $70.62 $72.43 $74.29 $76.20 $78.16 $80.16 $82.22 $84.33 $86.49 $88.70 $90.98 $93.30 $95.69 $98.14 O&M - Treatment $31.34 $31.98 $55.93 $67.92 $69.04 $69.31 $70.49 $71.71 $72.97 $74.26 $75.59 $76.95 $78.36 $79.80 $81.28 $82.80 $84.37 $85.97 $87.62 $89.31 $91.04 Capital Expenditures - Collection (R&R) $77.99 $80.24 $69.59 $70.83 $71.87 $72.15 $73.23 $74.34 $75.48 $76.63 $77.82 $79.03 $80.26 $81.53 $82.81 $84.13 $85.47 $86.84 $88.24 $89.66 $91.11 Capital Expenditures - Collection Expansion $0.00 $0.00 $15.34 $15.39 $21.84 $46.70 $22.32 $22.31 $22.29 $22.28 $22.27 $22.26 $22.25 $22.24 $22.24 $22.23 $22.23 $22.22 $22.22 $22.22 $22.22 Capital Expenditures - Treatment $0.00 $0.00 $806.09 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Debt Service $0.00 $0.00 ($806.09) $48.43 $47.91 $47.39 $46.87 $46.36 $45.86 $45.36 $44.86 $44.38 $43.89 $43.41 $42.94 $42.48 $42.01 $41.56 $41.10 $40.66 $40.21 Net Impact Fees $0.00 $0.00 ($17.14) $23.86 $7.65 ($45.29) $5.80 $5.42 $5.04 $4.67 $4.30 $3.93 $3.56 $3.19 $2.83 $2.46 $2.10 $1.74 $1.38 $1.02 $0.66 Total Moab Expenditures $143 $146 $186 $290 $283 $257 $288 $291 $294 $297 $301 $305 $308 $312 $316 $321 $325 $329 $334 $339 $343 GWSSA O&M - Collection $12.33 $12.61 $22.89 $23.41 $23.84 $23.92 $24.36 $24.82 $25.30 $25.78 $26.27 $26.78 $27.30 $27.84 $28.38 $28.94 $29.52 $30.10 $30.70 $31.32 $31.95 O&M - Treatment $31.34 $31.98 $55.93 $67.92 $69.04 $69.31 $70.49 $71.71 $72.97 $74.26 $75.59 $76.95 $78.36 $79.80 $81.28 $82.80 $84.37 $85.97 $87.62 $89.31 $91.04 Capital Expenditures - Collection (R&R) $28.90 $29.68 $25.69 $26.09 $26.29 $25.71 $25.92 $26.13 $26.36 $26.59 $26.83 $27.08 $27.34 $27.60 $27.87 $28.15 $28.44 $28.73 $29.04 $29.35 $29.67 Capital Expenditures - Collection Expansion $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Capital Expenditures - Treatment $0.00 $0.00 $750.59 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Debt Service $0.00 $0.00 ($750.59) $34.04 $32.47 $31.03 $29.70 $28.47 $27.33 $26.26 $25.27 $24.35 $23.48 $22.66 $21.89 $21.17 $20.49 $19.84 $19.23 $18.64 $18.09 Total GWSSA Expenditures $73 $74 $105 $151 $152 $150 $150 $151 $152 $153 $154 $155 $156 $158 $159 $161 $163 $165 $167 $169 $171 San Juan O&M - Collection #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! $23.92 $24.36 $24.82 $25.30 $25.78 $26.27 $26.78 $27.30 $27.84 $28.38 $28.94 $29.52 $30.10 $30.70 $31.32 $31.95 O&M - Treatment #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! $69.31 $70.49 $71.71 $72.97 $74.26 $75.59 $76.95 $78.36 $79.80 $81.28 $82.80 $84.37 $85.97 $87.62 $89.31 $91.04 Capital Expenditures - Collection (R&R) #DIV/0! #DIV/0! #DIV/0! #DIV/01 #DIV/0! $25.71 $25.92 $26.13 $26.36 $26.59 $26.83 $27.08 $27.34 $27.60 $27.87 $28.15 $28.44 $28.73 $29.04 $29.35 $29.67 Capital Expenditures - Collection Expansion #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Capital Expenditures- Treatment #DIV/0! #DIV/0! #DIV/0! #DIV/01 #DIV/0! $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Debt Service #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Total San Juan Expenditures #13I1//01 #DI11/01 #13I1//01 #DIV/01 #13I11/01 $119 $121 $123 $125 $127 $129 $131 $133 $135 $138 $140 $142 $145 $147 $150 $153 Septage O&M - Collection $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 O&M - Treatment $31.34 $31.98 $55.93 $67.92 $69.04 $69.31 $70.49 $71.71 $72.97 $74.26 $75.59 $76.95 $78.36 $79.80 $81.28 $82.80 $84.37 $85.97 $87.62 $89.31 $91.04 Capital Expenditures - Collection (R&R) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Capital Expenditures - Collection Expansion $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Capital Expenditures - Treatment $0.00 $0.00 $1,863.56 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Debt Service $0.00 $0.00 ($1,863.56) $100.24 $96.03 $92.16 $88.59 $85.28 $82.21 $79.36 $76.70 $74.21 $71.87 $69.68 $67.62 $65.68 $63.84 $62.11 $60.47 $58.91 $57.43 Total Septage Expenditures $31 $32 $56 $168 $165 $161 $159 $157 $155 $154 $152 $151 $150 $149 $149 $148 $148 $148 $148 $148 $148 Cost Per ERU/month Moab $ 11.88 $ 12.19 $ 15.48 $ 24.16 $ 23.62 $ 21.45 $ 23.96 $ 24.23 $ 24.51 $ 24.79 $ 25.09 $ 25.39 $ 25.71 $ 26.03 $ 26.37 $ 26.72 $ 27.07 $ 27.44 $ 27.82 $ 28.21 $ 28.62 GWSSA $ 6.05 $ 6.19 $ 8.71 $ 12.62 $ 12.64 $ 12.50 $ 12.54 $ 12.59 $ 12.66 $ 12.74 $ 12.83 $ 12.93 $ 13.04 $ 13.16 $ 13.29 $ 13.42 $ 13.57 $ 13.72 $ 13.88 $ 14.05 $ 14.23 San Juan #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! $ 9.91 $ 10.06 $ 10.22 $ 10.39 $ 10.55 $ 10.72 $ 10.90 $ 11.08 $ 11.27 $ 11.46 $ 11.66 $ 11.86 $ 12.07 $ 12.28 $ 12.50 $ 12.72 Septage Cost Per Gallon Septage $ 0.033 $ 0.034 $ 0.060 $ 0.180 $ 0.202 $ 0.197 $ 0.194 $ 0.191 $ 0.188 $ 0.186 $ 0.183 $ 0.182 $ 0.180 $ 0.179 $ 0.177 $ 0.176 $ 0.176 $ 0.175 $ 0.175 $ 0.174 $ 0.174 Average Cost Per Resident/Month - Note: These are approximate values only based on historic report of average residential costs. Actual rates will be calculated as part of the detailed rate study. Moab $17.43 $ 17.89 $ 22.71 $ 35.46 $ 34.66 $ 31.47 $ 35.16 $ 35.55 $ 35.96 $ 36.37 $ 36.81 $ 37.26 $ 37.72 $ 38.20 $ 38.69 $ 39.20 $ 39.72 $ 40.26 $ 40.82 $ 41.40 $ 41.99 GWSSA $6.80 $ 6.96 $ 9.79 $ 14.19 $ 14.21 $ 14.05 $ 14.10 $ 14.16 $ 14.24 $ 14.33 $ 14.43 $ 14.54 $ 14.66 $ 14.80 $ 14.94 $ 15.09 $ 15.26 $ 15.43 $ 15.61 $ 15.80 $ 16.00 Page 3 of 3 APPENDIX B PROJECTED NON -RATE REVENUE AND REVENUE REQUIREMENTS Table B1 Moab City - Sewer Rate Study Non -Rate Revenue (Including Impact Fees) Assumed Inflation Rate = 3.0% Item Projected FYE 2017 Projected FYE 2018 Projected FYE 2019 Projected FYE 2020 Projected FYE 2021 Projected FYE 2022 Operations Non -Rate Revenue GWSSA Sewer Sales $296,157 $442,821 $464,107 $512,925 $536,720 $561,422 Special Services $1,500 $1,562 $1,626 $1,692 $1,762 $1,834 Septage Sales $76,755 $241,341 $247,302 $252,057 $258,342 $264,836 Sewer Connections $8,000 $8,328 $8,669 $9,025 $9,395 $9,780 Total Operations Non -Rate Revenue $382,412 $694,052 $721,704 $775,699 $806,219 $837,871 Non -Operations Non -Rate Revenue Impact Fees $188,569 $191,494 $328,003 $402,869 $410,987 $414,332 Finance Charges & Other Income $22,400 $23,318 $24,274 $25,270 $26,306 $27,384 Total Non -Operations Non -Rate Revenue $210,969 $214,813 $352,278 $428,138 $437,293 $441,716 Total Non -Rate Revenue $593,381 $908,865 $1,073,982 $1,203,837 $1,243,511 $1,279,587 Table B2 Moab City - Sewer Rate Study Revenue Requirements Cash Basis Item Projected FYE 2017 Projected FYE 2018 Projected FYE 2019 Projected FYE 2020 Projected FYE 2021 Projected FYE 2022 Sewer Treatment Expenses General $190,000 $196,745 $203,729 $210,962 $218,451 $226,206 Salaries & Wages $138,579 $193,499 $200,368 $207,481 $214,846 $222,473 Employee Benefits $104,702 $123,419 $127,800 $132,337 $137,035 $141,900 Overtime $8,000 $8,284 $8,578 $8,883 $9,198 $9,524 Subscriptions & Memberships $4,600 $4,763 $4,932 $5,107 $5,289 $5,477 Travel $2,500 $2,589 $2,681 $2,776 $2,874 $2,976 Office Expenses & Supplies $2,000 $2,071 $2,145 $2,221 $2,299 $2,381 Equipment Supplies & Maintenance $50,500 $52,293 $54,149 $56,071 $58,062 $60,123 Building Supplies & Maintenance $5,000 $5,178 $5,361 $5,552 $5,749 $5,953 Utilities & Telephone $57,700 $109,748 $113,644 $117,679 $121,856 $126,182 Equipment & Property Rental $2,500 $2,589 $2,681 $2,776 $2,874 $2,976 Fuel $12,000 $12,426 $12,867 $13,324 $13,797 $14,287 Shipping/Freight $5,000 $5,178 $5,361 $5,552 $5,749 $5,953 Sewer Collections Expenses Capital Lease $21,600 $22,367 $23,161 $23,983 $24,834 $25,716 Salaries & Wages $139,798 $144,761 $149,900 $155,221 $160,732 $166,438 Employee Benefits $95,910 $99,315 $102,840 $106,491 $110,272 $114,186 Overtime $6,000 $6,213 $6,434 $6,662 $6,898 $7,143 Subscriptions & Memberships $1,560 $1,615 $1,673 $1,732 $1,794 $1,857 Travel $2,700 $2,796 $2,895 $2,998 $3,104 $3,215 Office Expenses & Supplies $1,500 $1,553 $1,608 $1,665 $1,725 $1,786 Equipment Supplies & Maintenance $30,000 $31,065 $32,168 $33,310 $34,492 $35,717 Building Supplies & Maintenance $2,000 $2,071 $2,145 $2,221 $2,299 $2,381 Utilities & Telephone $6,100 $6,317 $6,541 $6,773 $7,013 $7,262 Equipement Rental $5,000 $5,178 $5,361 $5,552 $5,749 $5,953 Fuel $8,000 $8,284 $8,578 $8,883 $9,198 $9,524 Professional & Technical Services $33,500 $34,689 $35,921 $37,196 $38,516 $39,884 Education $6,350 $6,575 $6,809 $7,051 $7,301 $7,560 Freight $1,500 $1,553 $1,608 $1,665 $1,725 $1,786 Special Departmental Supplies $39,500 $40,902 $42,354 $43,858 $45,415 $47,027 Total O&M $984,099 $1,134,035 $1,174,293 $1,215,980 $1,259,147 $1,303,847 Debt Service Potential 2017 Treatment Plant Loan $0 $798,834 $798,834 $798,834 $798,834 $798,834 Potential 2019 South Trunk Loan $0 $0 $0 $73,133 $73,133 $73,133 Total Debt Service $0 $798,834 $798,834 $871,967 $871,967 $871,967 Expansion and Replacement FYE 2017 FYE 2018 FYE 2019 N'YE 2020 N'YE 2021 FYE 2022 Collection - Rehabilitation & Replacement $0 $0 $0 $655,227 $285,684 $695,130 Loaned Treatment Plant Capital Costs $3,900,000 $10,300,000 $0 $0 $0 $0 Non -Loaned Treatment Plant Capital Costs $1,320,595 $0 $0 $0 $0 $0 New South Trunk Pipeline $0 $300,000 $1,800,000 $0 $0 $0 Replace 400 East Trunk Pipeline $0 $0 $0 $0 $389,200 $0 Sewer Lift Station Pump $8,000 $0 $0 $0 $0 $0 SCADA Upgrades $40,000 $0 $0 $0 $0 $0 Building Project $100,000 $0 $0 $0 $0 $0 Sewer Master Plan $70,000 $0 $0 $0 $0 $0 Loan Proceeds ($3,900,000) ($10,300,000) ($1,300,000) $0 $0 $0 Transfer to/(from) Reserve Fund ($991,082) ($138,512) $15,310 $33,392 $83,458 $72,862 Total Capital Outlays $547,513 $161,488 $515,310 $688,619 $758,342 $767,992 Total Revenue Requirements $1,531,612 $2,094,357 $2,488,437 $2,776,566 $2,889,456 $2,943,806 LESS: Operations Non -Rate Revenue $382,412 $694,052 $721,704 $775,699 $806,219 $837,871 Non -Operations Non -Rate Revenue $210,969 $214,813 $352,278 $428,138 $437,293 $441,716 Net Revenue Requirements $ 938,231 $ 1,185,492 $ 1,414,456 $ 1,572,729 $ 1,645,944 I $ 1,664,219 Sewer Rate Study Moab City Draper, Utah Office: 154 East 14000 South Draper, Utah 84020 Phone: (801) 495-2224 Fax: (801) 495-2225 Eagle, Idaho Office: 776 East Riverside Drive Suite 250 Eagle, Idaho 83616 Phone: (208) 939-9561 Fax: (208) 939-9571 WWW.BOWENCOLLINS.COM Bowen Collins & Associates, Inc. CONSULTING ENGINEERS St. George, Utah Office: 20 North Main Suite 107 St. George, Utah 84770 Phone: (435) 656-3299 Fax: (435) 656-2190