The Walnut Valley Water District, located in Walnut, California, retained MuniFinancial to prepare water and recycled water rate analyses, which will include new rate schedules that meet the District’s respective current and near-term projected system revenue requirements.
For the purpose of determining annual revenue requirements as a basis to set future rates, we used a projection period of five years, spanning fiscal years 2006/2007 through 2010/2011. The study focused on District revenue requirements, appropriate and fair rates, an equitable rate structure, and maintenance of its water and recycled water systems on a financially sound and stable basis over the next five fiscal years. The study was conducted using historical and projected data on operating and non-operating expenses, capital expenditures, and consumption data provided by the District.
Based on our analyses, we recommended that the District adopt proposed rate structures that will boost water revenue by four percent (4%). These rate structures adequately provide for ongoing costs and debt service and allow for funding of reserves for unscheduled expenses.
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