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<br />SCOPE & OBJECTIVES <br />The components and objectives of this Study were as follows: <br />1. Revenue Sufficiency Analysis (RSA) – Project the sufficiency of user charge revenues to fund <br />operating expenses, capital investment, and debt service while maintaining adequate debt <br />service coverage and working capital reserve requirements over a long-term projection <br />period. <br />2. Cost of Service Analysis (COSA) – Apportion sanitation costs from the RSA among service <br />types to determine the true cost of sanitation services provided by the City. <br />3. Assessment/User Charge Structure Analysis – Examine the City’s current sanitation user <br />charge and test modifications based off of the results from the COSA and revenue <br />requirement from the RSA. <br />The following sections describe the source data and assumptions used in the analyses, the work that <br />was performed, and the recommended Sanitation Services Users Charge. <br />REVENUE SUFFICIENCY ANALYSIS (RSA) <br />SOURCE DATA <br />The following presents the source data provided to SCS by City staff, which was relied upon to <br />conduct the Study: <br />BEGINNING FUND BALANCES <br />Unaudited trial balance schedules for the fiscal year ended 6/30/2023 provided by City staff were <br />used to establish fund balances for the Environmental Sanitation Program. <br />REVENUES <br />The revenues utilized in the RSA reflect an evaluation of multiple years of historical results and user <br />charge revenues collected, the FY 2024 Budget, and conversations with City staff. Beginning in FY <br />2025, user charge revenue is based upon the FY 2024 projection, adjusted annually to reflect <br />assumed revenue adjustments and change in billed units. Projections of all other revenues are <br />based upon the FY 2024 projection, excluding interest income (which was calculated annually based <br />upon projected average fund balances and assumed interest rates). <br />OPERATING EXPENDITURES <br />The City’s operating expenditures include all personal services, operations and maintenance (O&M) <br />expenses, transfers, debt service requirements, and minor capital outlay. The expenses reflected in <br />the RSA reflect an evaluation of multiple years of historical results, the FY 2024 Budget, and <br />7