Attachment

Updated Forecast Utility Committee November 23, 2009 Prepared by Finance Department ATTACHMENT #1 Utility Committee Meeting of 11/23/2009 GO0T/ET/TI JO SUNOS CoNTUMOD ANT] T# LNAIWHOVLLV

Water Fees Wastewater Fees Treatment Fees - Kent County Miscellaneous Income - Water Miscellaneous Income - Wastewater Imapct Fees - Water Impact Fees - Wastewater Total Revenue Treatment Fees - Kent County Operating Expenses - Water Operating Expenses - Wastewater Operating Transfers - Out (4.5%) Water Operating Transfers - Out (4.5%) Wastewater Total Operating Expenses Operating Margin Non-Oper. Rev. - Interest on Operating Non-Oper. Rev. - Interest on Reserves Margins Available For Debt Service Interest for Long-Term Debt Cash From Operations Non Cash Investment Income/(Loss) Debt Issue Cost Amort.-Outstanding Debt Depreciation Expense Net Margins (S$) FYoS Forecast $ 4.090.000 $ 2.400.000 4.080.950 285.775 35,500 125.000 630.000 FYO9 Comparison - Forecast/Actual FYoS Actual Difference 4.070.524 $ 2.351.885 3.733.644 385.380 59.660 126.000 609.024 11,647,225 (3.435.430) (3.471.527) (2.232.016) (221,204) (343.606) 11,336.117 (3.585.791) (3.562.718) (2.137.246) (221,204) (343.606) (9.703.783) (9.850.565) 1,943,442 75,000 151.152 1.485.552 161.716 164.071 2,169,594 (161,066) 1.811.339 7 (160.518) 2.008.528 (31.597) (1.728.960) 1,650,821 (31.596) (1.439.639) 247.970 179.586 Debt Service Coverage Margins Avail. for Debt Service Total Debt Service Debt Service Coverage Ratio 2.169.594 835.600 2.60 1.811.339 835.322 2.17 Transfer to | & E Fund - Combined Transfer to Impact Fee Reserve - Combined Reinvestment of Reserve Interest - Combined Debt Service Principal - Combined 700,000 264.260 151,152 674.534 700.000 415,941 164.071 674.804 Total Cash Budget Requirements - Combined 1.789.946 1.954.816 Net Positive/(Negative Cash 218.582 303.995

Updated Revenue & Expense Trends Operating Revenues & Expenses Prior 5 Year Trend (Expense excludes Debt & Transfers) $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $- FYOS FYO6 FYO7 FYO8 m Revenues m Expenses FYO9 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 6 Operating Revenues & Expenses Forecasted 5 Year Trend (Expense excludes Debt & Transfers) FY10 FY11 FY12 FY13 B Revenues BH Expenses FY14

Capital Investment Trends Capital Investment Related Accounts Prior 5 Year Trend - Cumulative $9,981,810 $10,000,000 $8,087,613 $8,000,000 $6,000,000 $4,126,124 $4,000,000 998,549 $2,000,000 rama 472,640 1,009,515 uw FOS FY06 FYO7 FYO8 FYO9 == Capital Investment Expenses m= Annual |nterest Cost em Year End Outstanding Debt Capital Investment Related Accounts Forecasted 5 Year Trend - Cumulative $32,564,927 $28,000,000 $25,646,632 $24,000,000 $20,000,000 $16,000,000 $12,000,000 $8,000,000 al $4,000,000 030 yeety ¢. eri 043.71 FY1O FYLL FY12 FYL3 FYL4 385,800 == Capital Investment Expenses == Annual interest Cost em Year End Outstanding Debt

Revenues & Expenses (No Rate Increases) $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $- Operating Revenues & Expenses Forecasted 5 Year Trend (Without Rate Increases) (Expense includes Debt & Transfers) FY10 FY11 FY12 FY13 FY1 MRevenues M Expenses 4

ee eee eee Rate Increases to Sustain Debt Covenants & Policies Water & Wastewater Individual Rates Water & Wastewater Combined Rates 10.50 FYOS = FYO6. = FYO7?,)s FYOB.SFYOO) FY. FY. FYL2-=FYLB FY = Water in City =f Water Out of City =i Wastewater In City = Wastewater Out of City FOS = FYO6.=sFYO7?) «= FYOB. SFOS. FYLO.-FYAL. Ss FYA2-Ss FYB FY == Total In City =Total Out of City

Alternative Rate Increases Fiscal Year 2010 2011 2012 2013 2014 Cumulative Fiscal Year 2010 2011 2012 2013 2014 Cumulative Capital As Presented Rate Increase Improvements Rate FY10 & FY11 In millions Increases Covers all 5 years $9.7 10.0% 10.0% 6.0 20.0% 80.0% 44 23.0% 0.0% 5.3 17.0% 0.0% 7.2 20.0% 0.0% $32.6 90.0% 90.0% Capital No New Debt past FY10 Rate Increase Improvements Reduced Water Quality & Fiscal $6 Mil. Transfer to | & E In millions | & | Projects Year No layering new debt $9.7 1.3 1.0 0.9 1.2 $14.1 Water Quality & Inflow/Infiltration Projects will require combined annual funding of $6 million.

Net Margins - Combined Water & Wastewater Water Fees Wastewater Fees Rate Increase Treatment Fees - Kent County Miscellaneous Income - Vater Miscellaneous Income - Wastewater Imapct Fees - Water Impact Fees - Wastewater Total Revenue Treatment Fees - Kent County Operating Expenses - Water Operating Expenses - Wastewater Operating Transfers - Out (4.5%) Water Operating Transfers - Out (4.5%) Wastewater Total Operating Expenses Operating Margin Non-Oper. Rev. - Interest on Operating Non-Oper. Rev. - Interest on Reserves Margins Available For Debt Service Interest for Long-Term Debt Cash From Operations Debt Issue Cost Amort.-Outstanding Debt Depreciation Expense ie Actual Year1 Year2 Year3 Year4 Year5 2009 2010 2011 2012 2013 2014 a | $4,070,524 | $4.090.000 $ 4.090.000 $ 4.090.000 $ 4.090.000 $ 4.090.000 2,351,885 3.045.560 3,045,560 3,045,560 3,045,560 3.045.560 - 409.000 1,122,600 1,927,500 2,518,400 3,232,000 3,733,644 3.435.390 3,435,390 3,435,390 3.435.390 3.435.390 385,380 329,200 338,320 347,590 356,860 366,130 59.660 35.500 35.500 35,500 35.500 35.500 126.000 280.000 400.000 400.000 400.000 400.000 609.024 475.000 665.000 665.000 665.000 665.000 11,336,117 | 12,099,650 13,132,370 13,946,540 14,546.710 15,269,580 (3,.585,.791)| (3.435.430) (3.435.390) (3.435.390) (3,435,390) (3,562.718)| (3.495.100) (3.804.451) (3,952,810) (4,093,656) (2.137,246)| (2.097.181) (2.357.646) (2.455.367) (2,543,802) (221,204) (231,500) (256,190) (275,013) (288,313) (343.606 (316.561) (339.446) (357.262) (370.969) (9.850.565)| (9.575.772) (10.193.123) (10.475.841) (10.732.130) 1,485,552 2.523.878 2.939.247 3.470.699 3.814.580 4.267.126 161,716 78.600 104,000 104,000 104,000 104,000 164.071 126.951 131,335 135.411 138.661 145.095 1,811,339 2.729.429 3,174,582 3,710,110 4.057.241 4.516.221 (160,518) (141.881) (496.141) (854,222) (952.264) (1.043.217 1.650.821 (31,596) (1.439.639 2.587.548 (31,597) (1.964.631) 2,678,441 (40.774) (2.174.259) 2.855.888 (40.774) (2.340.226) 3.104.977 (40.774) (2.544.228) 3.473.004 Net Margins (S Debt Service Coverage Margins Avail. for Debt Service Total Debt Service Debt Service Coverage Ratio Transfer to | & E Fund - Combined Transfer to Impact Fee Reserve - Combined Transfer to Capital Asset Reserve - Combined Reinvestment of Reserve Interest - Combined Debt Service Principal - Combined Total Cash Budget Requirements - Combined Net Positive/(Negative Cash $179,586 $1,811,339 | $2.729.459 $ 3,174,582 $ 3.710.110 $ 4.057.241 $ $ 835,322 $ 832,951 3.28 4,516,221 S$ 941.784 $ 1.968.046 $ 2.186.584 $ 2.611.614 3.37 1.89 1.86 1.73 S$ _700.000/S 700.000 $ 1.000.000 $ 1.000.000 $ 1.000.000 $ 1.000.000 S$ 415.941] $ 110.062 S$ 161.603 $ = $ = $ = is - dS S$ 164.071/3 126.951 225.000 $ 131,335 _ $ 225.000 $ 135.411 225.000 $ 138.661 125.000 145.095 S$ 674.804/]3 691.070 S$ 445643 $ 1.113.824 $ 1.234.320 $ 1.568.397 $1,954,816 | $1.628.083_ $ 1.963.580 $ 2.474.235 $ 2.597.981 $ 2.838.492 S_(303.995)| S$ _ 959.465 S$ 714.860 $5 381.653 _ $ 506.996 $ 634.512

Increase Over Base Rate Net Margins - Water Water Fees Rate Increase Miscellaneous Income - Water Imapct Fees - Water Total Revenue Operating Expenses - Water Operating Transfers - Out (4.5%) Water Total Operating Expenses Operating Margin Non-Oper. Rev. - Interest on Operating Non-Oper. Rev. - Interest on Reserves Margins Available For Debt Service Interest for Long-Term Debt Cash From Operations Debt Issue Cost Amort.-Outstanding Debt Depreciation Expense Net Margins (S Debt Service Coverage Margins Avail. for Debt Service Total Debt Service Debt Service Coverage Ratio Transfer to | & E Fund - Water Transfer to Impact Fee Reserve - Water Transfer to Capital Asset Reserve Reinvestment of Reserve Interest Debt Service Principal Total Cash Budget Requirements Net Positive/(Negative Cash ie 10.0% 10.0% 10.0% 7.0% 10.0% Actual Year1 Year 2 Year 3 Year 4 Year 5 2009 2010 2011 2012 2013 2014 T_T TT*"‘“'"!"'._ sd $4,070,524 | $4.090.000 $ 4.090.000 $ 4.090.000 $ 4.090.000 $ 4,090,000 - fr 409.000 818.000 1.227.000 1,613,300 1.922 300 385,360 329,200 338,320 347,590 356.860 366,130 126.000 280.000 400.000 400.000 400.000 400.000 4.581.904 5.108.200 5,646,320 6.064.590 6.360.160 6.778.430 (3,562,718)| (3.495.100) (3.804.451) (3.952.810) (4.093.656) (4,239,676) (221.204) (231,500) (256.190) (275,013) (288.313) (307.135 (3.783,922)| (3.726.600) (4.060.641) (4.227.822) (4.381.969) (4.546.811 797,982 1,381,600 1,585,679 1,836,768 1.978.191 2,231,619 65.363 35.400 46.800 46.800 46.800 46.800 40.492 14.894 13,959 17,377 20.899 24,526 903,838 1,431,894 1.646.438 1,900,945 2.045.890 2,302,945 (85.624 (75.013) (264.387) (464.800) (463.898) (584.778 818.214 1,356,881 1,382,051 1,436,145 1,581,992 1,718,167 (18,958) (18,958) (23,888) (23,888) (23,888) (23,888) 767.506 1.018.089 1.158.169 1.245.185 1.358.480 1.524.446 S$ 31,750|$ 319.834 _$ 199994 $ 167.072 $ 199.624 $ 169.832 $ 903,838 S$ 469.624 1.92 $1,431,894 $ 1.646438 $ 1.900.945 $ 2.045.890 $ 2,302,945 $ 468.013 S$ 438.387 S$ 971,150 $ 1,074,661 $ 1,213,389 3.06 3.76 1.96 1.90 1.90 | | ; 384,000 $1,050,492 ; 393.000 $ $_ 907.894 _ $ 774.000 $ 506.350 $ 610.763 $ 628.611 787,959 $ 1,123,727 _$ 1.231.662 $ 1,153,137 $_ (232,278 S$ 448.987 $ 594092 $ 312418 $ 350.330 $ 565.030

ee eee eee Increase Over Base Rate 0.0% 10.0% 13.0% 10.0% 10.0% Actual Year1 Year 2 Year 3 Year4 Year 5 2009 2010 2011 2012 2013 2014 Net Margins - Wastewater a Wastewater Fees $2,351,885 | $3.045.560 $ 3.045.560 $ 3.045.560 $ 3.045.560 $ 3,045,560 Rate Increase - - 304.600 700.500 1.005.100 1.309.700 Treatment Fees - Kent County 3,733,644 3,435,390 3,435,390 3,435,390 3,435,390 3,435,390 Miscellaneous Income - VWastewater 59,660 35,500 35,500 35,500 35,500 35,500 Contractor Contributions - Wastewater - - - - - - Impact Fees - Wastewater | 609.024 475.000 665.000 665.000 665.000 665.000 Total Revenue 6.754.213 6.991.450 7,486,050 7,881,950 8.186.550 8.491.150 Treatment Fees - Kent County (3.585.791)| (3.435.430) (3.435.390) (3.435.390) (3.435.390) (3,435,390) Operating Expenses - Wastewater (2.137,.246)} (2.097.181) (2.357.646) (2.455.367) (2.543.802) (2,635,577) Operating Transfers - Out (4.5%) Wastewater (343.606) (316.561) (339.446) (357,262) (370.969) (384.676) Total Operating Expenses (6.066.643)| (5.649.172) (6.132.482) (6.248.019) (6.350.161) (6.455.643) Operating Margin 687.570 1.142.278 1,353,568 1,633,931 1,836,389 2,035,507 Non-Oper. Rev. - Interest on Operating 96,353 43,230 57.200 57,200 57,200 57,200 Non-Oper. Rev. - Interest on Reserves 123.579 112.057 117.376 118.034 117.762 120.569 Margins Available For Debt Service 907.501 1,297,565 1,528,144 1,809,165 2,011,351 2,213,276 Interest for Long-Term Debt 74.894 66.868 231.754 389,422 488.366 458.439 Cash From Operations 832,607 1,230,697 1,296,390 1,419,743 1,522,986 1,754,837 Debt Issue Cost Amort.-Outstanding Debt (12.638) (12.639) (16.886) (16.886) (16.886) (16.886) Depreciation Expense (672.133)| (946.542) (1.016.091) (1.095.042) (1.185.748) (1.331.847 Net Margins (S S$ 147.836 |S 271.517 S$ 263.413 $ 307.816 $ 320.352 $ 406.105 Debt Service Coverage Margins Avail. for Debt Service 907.501 1,297,565 1,528,144 1,809,165 2,011,351 2,213,276 Total Debt Service 365,698 364,938 503.397 996.896 1,111,923 1,398,225 Debt Service Coverage Ratio 248 3.56 3.04 1.81 1.81 1.58 a | | Transfer to | & E Fund - Wastewater Transfer to Impact Fee Reserve - Wastewater Transfer to Capital Asset Reserve Reinvestment of Reserve Interest S$ 123.579 |S 112.057 S$ 117.376 S$ 118.034 $ 117.762 S$ 120,569 Debt Service Principal Total Cash Budget Requirements Net Positive/(Negative Cash SS (71,717)| $_ 510.508 S$ 120,768 $ 69.235 $ 156.666 $ 69.482

Table 7 Capital Improvement Plan 05/13/2009 with 20 Year Bonds CAPITAL PROJECTS Meter Reading - Radio Read Meters (Split W/WW 50%) Vehicles & Equipment (Split W/WW 50%) Eng/Insp/Mtrng Water Vehicles & Equipment - Water Meter Reading - Radio Read Meters (Split W/WW 50%) Cheswold Well #8 Replacement Bayard Avenue Contact Chamber Contact Chamber Pear Street Washington Street South Street 1.0 MG Elevated Storage Tank (Bonded) Piney Point Well (Bonded) Scarborough Road Interconnection South Governors Avenue Water Main Upgrade Location/Well to be Determined Emergency Generators (Homeland Security Grant) Wellhead Redevelopment Remote Control & Well Monitor Misc. Distribution Improvements Water Quality Improvements (Bonded) Wellhead VFD Upgrades Future Well Installation Vehicles & Equipment - Wastewater Meter Reading - Radio Read Meters (Split W/WW 50%) Lafferty Lane Pump Station Replacement White Oak Farms Pump Station VFD's Dover East Pump Station & Force Main US 13 East Dover Bypass [South Governors Avenue Sewer Main Upgrade Tar Ditch Interceptor Upgrade ISCADA System Technology Upgrade atic Ds Fox Hall Pump Station Replacement (Bond) Heatherfield Pump Station Upgrade (Bond) Delaware State University Force Main Rerouting (Bond) Brandywine Pump Station Replacement (Bond) Lepore Road Pump Station Replacement (Bond) Rolling Acres Pump Station Replacement (Bond) $ iscal Year 2009 29,000 147,250 64,689 113,761 57,400 135,000 29,093 653,767 310,100 120,800 195,000 50,446 200,000 140,000 73,016 60,000 197,685 88,565 2,665,572 248,746 102,750 370,569 56,037 161,351 291,000 Fiscal Year 2010 533,510 1,023,700 846,807 200,000 3,026,317 8,300 3,362,481 518,230 79,300 336,400 107,200 336,400 52,000 40,000 26,800 Fiscal Year 2011 Fiscal Year 2012 Utility Committee Meeting of 11/23/2009 ATTACHMENT #2 Fiscal Year 2013 Fiscal Year 2014 ~—- § - § - $§ - 21,200 $ - 113,400 2,390,000 450,000 60,000 70,000 990,000 4,073,400 79,800 82,100 375,900 180,400 410,900 54,000 70,000 180,700 150,000 65,000 75,000 4,614,000 2,084,700 140,000 213/800 $ - 98,700 70,000 80,000 2,558,800 _ 25,000 75,000 2,907,500 200,400 $ - 307,600 75,000 85,000 3,099,000 171,400 171,200 3,909,200 63,700 Yr 09 - Yr 13 Total anal $ 21,200 747,700 533,510 1,023,700 846,807 2,590,000 450,000 150,000 325,000 55,000 375,000 8,461,800 196,400 246,200 16,001,117 492,200 265,800 3,362,481 518,230 425,200 336,400 107,200 336,400 427,900 220,400 137,700 414,400 395,000 429,000 G00T/ET/TI FO SuNso] Sop TUMMIOD AUTH], c# LNANWHOVLLV

Table 7 Capital Improvement Plan 05/13/2009 with 20 Year Bonds Dover Brook Gardens Pump Station Upgrade (Bond) Baltray Pump Station Replacement (Bond) McKee Road Pump Station Communicator Replacement Turnberry Force Main Redirect (Bond) DelTech Pump Station Replacement/Redirect (Bond) Westover Pump Station & Force Main Upgrade (Bond) Lakeview Drive Pump Station Replacement Schoolview Pump Station Force Main Redirect ‘Sliver Lake Pump Station Replacement/Upgrade Location/Pump Station to be Determined Inflow/Infiltration Investigation Inflow/Infiltration Removal/System Improvements DSRLF Inflow/Infiltration Removal/System Improvements - Bond 50,000 100,000. 45,000 45,000 58,000 85,000. 1,800,000 = - - - 900,000 1,000,000 1,279,400 33,000 35,000 37,000 39,000 75,000 145,000 70,000 506,000 474,800 578,600 46,600 40,000 77,000 1,800,000 Total Wastewater panes 6,700,111 1,940,100 2,312,100 2,362,700 3,280,200 | 16,595,211 al : | 4,132,070 | 6428 $6,034,700 _$ I es. ) $ 7,189,4( 528 |

Table 7 Capital Improvement Plan 05/13/2009 with 20 Year Bonds Fiscal Year FUNDING SOURCES 2009 | & E Fund Budget Balance - Water 1,446,695 | & E Fund Budget Balance - Wastewater 713,799 | & E Fund Budget Balance - Water Bonds : | & E Fund Budget Balance - Wastewater Bonds - Transfer from Operating Fund - Water Transfer from Operating Fund - Wastewater Transfer from Impact Fee Reserve - Water Transfer from Impact Fee Reserve - Wastewater Net Bond Proceeds - Water (Bond), Net Bond Proceeds - Wastewater (Bond) - State Loan Fund - Water - State Loan Fund - Wastewater Interest Income Developer Contributions Grants/State Reimbursements - Water (Generators) Miscellaneous Receipts 246,351 36,000 140,000 Ending Budget Balance Water $ 431,400 Wastewater $ 219,375 Water Bonds $ : Wastewater Bonds $ - Total Budget Balances $ 650,775 Check Total $ 4,782,845 Fiscal Year 2010 431,400 219,375 518,230 2,404,017 5,942,481 $ 309,100 $ 179,975 $ - $ - $ 489,075 $10,215,503 Fiscal Year 2011 309,100 179,975 500,000 500,000 8,002,800 5,518,800 555,100 420,475 4,172,800 3,827,600 8,975,975 APAHAA $ 15,010,675 Fiscal 2012 ear $ 555,100 $ 420,475 $ 4,172,800 $ 3,827,600 500,000 500,000 150,000 $ 734,400 $ 633,575 $ 2,558,800 $ 1,802,400 $ 5,729,175 $10,125,975 Fiscal 2013 ear $ 734,400 $ 633,575 $ 2,558,800 $ 1,802,400 500,000 500,000 $ 885,700 $ 761,275 $ a $ 2,920,900 $ 4,567,875 $ 9,838,075 Fiscal Year | Yr 09 - Yr 13 2014 Total $ 885,700 $ 761,275 $ . $ 2,920,900 500,000 500,000 2,500,000 2,200,000 518,230 11,101,800 8,627,700 2,404,017 5,942,481 150,000 575,500 901,975 575,500 901,975 nea $ $ $ $ a $ 1,477,475 $ 1,477,475 $ 8,666,875 $ 33,444,228

ATTACHMENT #3 Utility Committee Meeting of 11/23/2009 Rates - Past and Forecasted In Out $ % Out $ % Water | City City Chg Chg Sewer | InCity | City Chg Chg 2005 $2.35 $3.53 2005 $1.90 $2.85 2006 $2.45 $3.68 10-.15 10.5% 2006 $2.10 $3.15 .20-.30 10.5% 2007 $2.45 $3.68 2007 $2.10 $3.15 2008 $2.45 $3.68 2008 $2.10 $3.15 2009 $2.45 $3.68 2009 $2.10 $3.15 2010 $2.70 $4.05 .25-.37 10.0% 2010 $2.10 $3.15 2011 $2.96 $4.45 .26-.40 10.0% 2011 $2.31 $3.47 .21-.32 10.0% 2012 $3.26 $4.90 .30-.45 10.0% 2012 $2.61 $3.92 30-.45 13.0% 2013 $3.49 $5.24 .23-.34 7.0% 2013 $2.87 $4.31 .26-.39 10.0% 2014 $3.84 $5.77 35-53 10.0% 2014 $3.16 $4.74 .29-.43 10.0% 2006 Implemented $1.25 customer charge 2006 Implemented $1.25 customer charge GOOT/EC/TI JO SUNSSY SOMTUMMIOD ATTA] ¢# LNANHOVLLV