03 City Council Min 5-18-05 - Laserfiche WebLink

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Special City Council Meeting May 18, 2005 Page 6 Paris. Mr. Cline informed Council the electricity rate increased in January of this year and based on this rate increase, it is forecasted that the water and wastewater utility will experience an additional $450,000.00 in electricity costs. The current rates are not sufficient to meet the water and wastewater expenditures that are forecasted. There is a continued decline in consumption by the commercial customers. Cost increase coupled with the decline in consumption is the reason for the lack of the current rates to meet forecasted expenditures. The recommendation is to increase the water and wastewater rates. There is a need to restore the operating reserves and the recommendation is that the City eventually obtain a 60 day of level operating reserves. The City needs to try to get back to the level of the cash capital outlays as far as capital replacement to utility lines. In addition, there is a recommendation that next years rate the City look at raising the operating reserve level as far as the annual contribution an additional $200,000.00. Under the 50/50 scenario, an average residential customer with a 5/8 inch and 3/4 inch meter size would see a monthly increase of $3.05 on his or her bill. An average commercial customer with a 5/8 inch and 3/4 inch meter size would see an average monthly increase of $4.17 on their bill. Tony Williams gave a presentation regarding the financials as of the end of April 2004. He stated that at that point, the City had collected 3,380,869.88 and as of April this year the City had collected $3,360,000.00. Tony explained that last year the City missed its budget by $299,785.00 and that at the end of April the City’s collections were down $20,000.00. This year the City estimated $88,000.00 more in sales. With regard to expenditures, the electricity increase was approximately $450,000.00. At the end of April 2004, the City had spent $1,027,361.00 for water production. At the end of April 2005, the City had spent $1,273,000.00 for water production. That is almost exactly $250,000.00 more spent this year in water production cost, as a result of the increased cost of electricity. Based on this information, the City will exceed its expenses between $400,000.00 and $450,000.00 and miss the revenues by approximately $300,000.00, unless there is a dry year. 11.Consideration of and action on the following ordinances: A.ORDINANCE NO. 2005-017: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PARIS, PARIS, TEXAS, PROVIDING THAT THE CODE