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- Metropolitan Wastewater Management Commission Reserves
<br />~__ 1 REGIONAL WASTEWATER PROGRAM
<br />RESERVES
<br />The Regional Wastewater Program maintains reserve funds for dedicated purposes. Generally,
<br />reserves provide for a buffer against substantial fluctuations in revenues and expenditures,
<br />resulting in the ability to maintain stable rates while fully funding operating and capital needs.
<br />The Commission. has established a financial policy to maintain operating reserves at
<br />approximately 10% of the operating budget. Capital reserves provide for legal accounting of
<br />various funding sources and the ability to cover major one-time expenditures and maintain stable
<br />rates. The FY 01-02 budget includes both contributions to and expenditures from the dedicated
<br />Capital and Equipment Replacement Reserves. Further detail on the proposed FY 01-02 reserves
<br />is provided below.
<br />WORKING CAPITAL RESERVES
<br />The Working Capital Reserves provide funds for Springfield Administration and Eugene
<br />Operations costs paid prior to the receipt of user fees from Springfield Utility Board and Eugene
<br />Water and Electric Board. These reserves act as revolving accounts which are drawn down and
<br />replenished on a monthly basis. Eugene's Working Capital Reserve is $500,000, and
<br />Springfield's Working Capital Reserve is $200,000.
<br />CAPITAL RESERVES
<br />The Capital Reserves accumulate funds to cover CII' and Major Rehabilitation Program costs so
<br />that rate impacts can be minimized. These capital programs are tracked separately because the
<br />CIP is administered by Springfield and the Major Rehabilitation Program is administered by
<br />Eugene. The FY 01-02 proposed budget includes a contribution from the Operating Reserve of
<br />$1,971,000 to maintain this reserve and to cover costs related to the five-year CIP and Major
<br />Rehabilitation Programs. Interest earnings estimated at $178,000 will be credited to this account
<br />and the ending balance on June 30, 2002 is proposed at $4,991,779. Additional budget detail on
<br />the CIP and Major Rehabilitation Program reserves is provided below.
<br /> Adopted Amended Proposed
<br />C-'j Budget Budget Budget
<br />
<br />FY 00-01
<br />FY 00-01 ,
<br />FY 01-02
<br />CIP RESERVE
<br />Beginning Balance $6,315,312 $8,020,779 $6,301,805
<br />i ~ Xfr From Operating Reserve 2,449,660 2,705,624 1,971,000
<br />~-~ Xfr From CSD 0 0 0
<br />Interest 350,000 350,000 178,000
<br />Funding For Major Rehab 0 0 (456,000)
<br />Funding For CIP (4,160,000) (7,748,581) (3,003,026)
<br />Ending Balance $4,954,972 $3,327,822 $4,991,779
<br />(' ~ MAJOR REHAB RESERVE
<br />!; Beginning Balance $27,202 $32,306 $0
<br />Xfr From Operating Reserve 499,999 639,999 0
<br />Interest 900 900 0
<br />j '; Fund Major Rehab (523,500) (673,205) 0
<br />Ending Balance
<br />~,
<br />i $4,601 $0 $0
<br />j-~ - Page 31 FY 01-02 Budget
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