In the end-of-year report of 2007, we learn how much RWSA charges vs how much they spend:
In 2007, operating revenue increased 9.5% (pg 15) -- even though....
“operating expenses were virtually unchanged for the past two years” andIn fact in 2007, RWSA charged 57% more to its customers than it required in operational costs including debt payments. 2007 was the most profitable for RWSA since it began the practice of overcharging (in 2002?)
“Utility costs decreased 20%”
Since 2002, RWSA has collected $28,888,000 (28.9 million dollars) in overcharges from the city and county. The annual figure has grown substantially in recent years:
See the Supplemental section in Table 2: RWSA has “overcharged” the city and county since at least 2002 increasing its profit every year.
In this time, income has risen by 74% while expenses have only risen by 40%
See page 1 of the FOIA response (includes FOIA questions) where Tom Frederick explains the reserves a bit. See page 4 for reserve amounts.
But if there is $18 million in Reserves and Capital funds.... where is the rest?
Already charging way more than needed, what's with the rate increases? Last year, water rates increased 3.6% in the city and 7.2% in the county. Sewer rates increased an alarming 19.7% in the city and 17.2% in the county.
This year, RWSA proposes to increase water rates 2.6% for the city and 2.5% for the county. Sewer rates will increase another 10.4% for the city and 10.6% for the county.
In that same end of year report, it goes on and on about debt service. At the end of 2007, there was $51 millioin dollars in bonds and notes outstanding. Debt payments made in 2007 = $2,347,443.
The Capital budget for 2007 was 10.4 million. For 2008, it is 9.5 million. After that the figure jumps three- four fold to 29.3, 37.7, and 28.1 million in the three years following.
According to the report 10-15% will be paid through reserves, the rest funded with new bonds.
"By far the largest and most publicly scrutinized project in the capital program is the future increase in the water supply"That doesn't even include the pipeline and all the other infrastructure associated with it. That debt is double what the dam costs. This chart shows how the debt to finance the 142 million dollar water supply plan will escalate over time.
And that's assuming their estimates are right. In the 5-year CIP, they acknowledge the risks,
"Note that in the very earliest stages of concept development, the actual final costs may exceed the estimate by up to 100%, or they may fall below the estimate by as much as 50%. .....The true cost of a project is not known with complete accuracy until a project is actually built, and all the bills have been paid."BOTTOM LINE: Low water rate increases at the beginning will balloon as the more expensive parts of the plan are implemented.
From the 2007 annual financial report: Pg 16:
"Wastewater flows had dramatic increase in Oct/Nov of 2007 due to rainfall and infiltration"
See reports of sewage overflows during wet weather events here: Summary