Agenda - 10-21-2008 - 6e - Laserfiche WebLink

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assistance funds (based on some fixed criteria such as HUD's low/moderate income ~`' ,~ categories) in a special account controlled by one of the County's social service departments that are experienced in identifying/qualifying low wealth households, evaluating the amount of assistance required and managing funds that are to be used in this manner. Those funds would then be paid into the Efland sewer enterprise fund on behalf of the eligible rate payers should the BOCC determine that the system should actually operate as an enterprise. As of June 2008, Kevin Lindley and I had manipulated the model with our assumptions and projections relative to costs, continued County subsidies to the sewer operating costs, number of customers, etc. Based on the FY 2007-08 operations, the costs of operating the system came out to be approximately $180,000, one-third of which was derived from sewer use rates and two-thirds came from a direct subsidy from the County's General Fund. These costs contained no funding for ongoing capital improvements (replacing equipment) and no funding earmarked to create and maintain a fund balance. For the purposes of using the Raftelis model to generate example sewer rates, we assumed that annual contributions to the system's CIP fund were approximately $45,000, increasing at a rate of 4% per year thereafter and that an annual fund balance of 15% was created and maintained. Based on fiscal year 2007-08 income and costs, the total funding for the sewer system would have been approximately $259,000 with the inclusion of CIP funding and fund balance. The total billing in FY 2007-08 was for 11,000,000 gallons of sewer use. Assuming that there was no direct General Fund subsidy for the system, the cost per 1000 gallons per month came out to be approximately $23.50 for the first year. This figure represents in excess of a five-fold increase in the existing rate of $4.50 per 1000 gallons. Should the BOCC elect to continue directly subsidizing the system at a rate of $120,000 per year, the sewer rate would decrease to approximately $12.60 per thousand gallons for the first year. If the BOCC had determined to directly subsidize the system at a rate of $60,000 per year, the cost of 1000 gallons of use would come out to be approximately $18.00 per thousand gallons for the first year. None of these figures include costs associated with subsidizing individual rate payer households. Currently, approximately 45% of the Efland sewer customers use 3000 gallons of sewer per month or less (42 households use 1000 gallons per month or less, 19 use between 1000 and 2000 gallons per month, and 31 use between 2000 and 3000 gallons per month). The Efland Cheeks Elementary School averages approximately 80,000 gallons of sewer per month and Hancor generally use in excess of 100,000 gallons per month. At this point in time, we have not broken down the locations of those customers using less that 3000 gallons of sewer per month. Accordingly, we are unable to estimate (by a windshield evaluation of housing conditions) at this time the socio-economic status of those customers would see only a slight increase in their sewer bills on the basis of low to very low sewer use. Determining how many households will qualify for some level of rate assistance will have to be accomplished by a house to house income and occupancy survey. Assuming that the BOCC would want have an opportunity to evaluate and deliberate on how the Raftelis model works and how various decisions on model imputs (including the