City of Morgan Hill Adopted Budget FY 2016-17 and FY 2017-18

 CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY 16-17 and 17-18  OPERATING AND CIP BUDGET  CITY OF MORGAN HILL  FY16-17 and 17-18  Water Operations (continued) The new rates became effective April 1, 2016 with ratepayers seeing an increase of 9.0 percent in fixed meter and consumption charges, and further rate adjustments of 7.25 percent on January 1 of each subsequent years through 2020. Costs that must be recovered through rate revenue include purchased water, electricity, equipment and supplies, treatment chemicals, debt service, and salaries and benefits. Additionally, revenues generated from the water rates would be used to restore water reserve funds that have been drawn down to compensate for lower levels of water consumption. The two-year recommended budget in Water Operations incorporates a reduction in water consumption from the 2013 base year level by 30% in FY 16-17 and 20% in FY 17-18. At these water production levels, the groundwater production charges are budgeted at $2,358,651 and $2,845,753 in FY 16-17 and FY 17-18, respectively, which account for approximately 26% of the Water Operations budget. These amounts are based on the charges previously set by the SCVWD at $377 per AF in FY 16-17 and $398 per AF in FY 17-18. The SCVWD has proposed an additional increase to $398 per AF in FY 16-17 (11.8% increase over FY 15-16) and $420 per AF in FY 17-18. These additional increases in the amount of $131,384 in FY 16-17 and $157,303 in FY 17-18 are not included in the line item budgets. The City may consider to pass- through these additional increases to our water customers, as permitted in the recently approved Proposition 218 process. The FY16-18 recommended budget also includes a new GIS Manager position, which will be funded 13% by Water, and remainder by the General, Community Development, Park Maintenance, Wastewater Funds.

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