[et_pb_section fb_built=”1″ custom_padding_last_edited=”on|tablet” admin_label=”Popup – #undefined” _builder_version=”4.8.1″ _module_preset=”default” positioning=”none” horizontal_offset_tablet=”” horizontal_offset_phone=”” horizontal_offset_last_edited=”on|tablet” custom_margin=”0px||||false|false” custom_margin_tablet=”” custom_margin_phone=”” custom_margin_last_edited=”on|desktop” custom_padding=”0px|||0px|false|false” custom_padding_tablet=”|||25px|false|false” custom_padding_phone=”” da_disable_devices=”off|off|off” custom_padding__hover_enabled=”on|desktop” da_is_popup=”off” da_exit_intent=”off” da_has_close=”on” da_alt_close=”off” da_dark_close=”off” da_not_modal=”on” da_is_singular=”off” da_with_loader=”off” da_has_shadow=”on”][et_pb_row _builder_version=”4.8.1″ _module_preset=”default” width=”100%”][et_pb_column type=”4_4″ _builder_version=”4.8.1″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” hover_enabled=”0″ sticky_enabled=”0″]<\/p>\n
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Different types of water systems will have access to different types of funds. Funding for gray infrastructure comes from a fairly well defined list of funders and funding options but green infrastructure expands those possibilities by providing an avenue for co\u2010funding or other revenue streams from outside parties willing to partner with a system. A variety of funding types are described below. Systems should discuss what types of funds they want to use, what the advantages and disadvantages are, and invite funders to join the conversation. Typically, funding organizations and agencies are willing to provide information when requested and are usually very willing to help.<\/p>\n
There are also several resources available that compile funding sources for systems. The EFCNEnvironmental Finance Center Network<\/span><\/span><\/span> provides updated funding tables every year for each state. The tables include the funding organization, purpose or use of funds, how to apply, and contact information. To review these funding tables, click here<\/a>. Once you reach the site, click on the state for a listing of funding sources within that state.<\/p>\n Another great resource is the State Revolving Fund Switchboard created by the SW EFCSouthwest Environmental Finance Center<\/span><\/span><\/span>. It is an online repository of documentation and tools related to State Revolving Funds. The State Revolving Funds were created by the EPAEnvironmental Protection Agency<\/span><\/span><\/span> to disburse funds allocated by Congress for the use of states to improve water and wastewater system. The switchboard provides details on the administrators of the fund in each state and provides state specific resources. To view the State Revolving Fund Switchboard, click here.<\/a><\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row column_structure=”1_3,1_3,1_3″ _builder_version=”4.7.7″ _module_preset=”default” width=”100%” locked=”off”][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#d9d9d9″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#rates” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_vertical__hover=”2px”]<\/p>\n Rates<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#bf7e04″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#taxes” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Taxes<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#fffff4″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#fees” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Fees<\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row column_structure=”1_3,1_3,1_3″ _builder_version=”4.7.7″ _module_preset=”default” width=”100%” locked=”off”][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#f2cc0c” background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#reserves” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Reserves<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#f2f0ce” background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#partnerships” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Partnerships<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#fce196″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#incentives” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Incentives<\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row column_structure=”1_3,1_3,1_3″ _builder_version=”4.7.7″ _module_preset=”default” width=”100%” locked=”off”][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#d9a407″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#grants” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Grants<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#ccccc3″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#loans” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Loans<\/p>\n [\/et_pb_text][\/et_pb_column][et_pb_column type=”1_3″ _builder_version=”4.7.7″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” text_font=”|800|||||||” text_font_size=”24px” header_font=”|800|||||||” header_text_align=”center” background_color=”#bfb636″ background_enable_image=”off” text_orientation=”center” module_alignment=”center” height=”100px” custom_margin=”|||30px|false|false” custom_padding=”33px||||false|false” link_option_url=”#bonds” border_radii=”on|25px|25px|25px|25px” border_width_all=”1px” box_shadow_style=”preset1″ box_shadow_vertical=”0px” box_shadow_blur=”0px” locked=”off” box_shadow_vertical__hover=”2px” box_shadow_vertical__hover_enabled=”on|hover” box_shadow_blur__hover=”18px” box_shadow_blur__hover_enabled=”on|desktop” box_shadow_spread__hover_enabled=”on|hover”]<\/p>\n Bonds<\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row _builder_version=”4.8.1″ _module_preset=”default” width=”100%”][et_pb_column type=”4_4″ _builder_version=”4.8.1″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” locked=”off”]<\/p>\n <\/a><\/p>\n Rates<\/b>\u00a0\u00a0<\/p>\n A rate structure is simply an allocation of the costs of operating and maintaining the system to the customers. Many systems struggle with rate-setting and with gaining public acceptance for rates. Rates are often determined by a political process that is not based on business reality. Such rates will inevitably lead to underinvestment in infrastructure and perhaps even an inability to meet current operating expenses. Political expediency often results in a \u201cwillingness to charge\u201d problem in which officials and managers become over-sensitized to their customers\u2019 desires to keep rates low or general unwillingness to pay for services. However, willingness to pay is not the same as ability to pay. For this reason, it is important\u00a0for systems\u00a0to assess\u00a0their\u00a0customers actual ability to pay.\u00a0In order to set an effective rate structure, a system should adopt a full-cost pricing strategy. Full-cost pricing seeks to cover all current and future costs that are not covered by external\u00a0sources of revenue (grants, loans, bonds,\u00a0etc.).\u00a0A good rate analysis must start with good data on costs and future plans. It is therefore imperative that the\u00a0system\u00a0have a budget and a good record-keeping system for tracking costs. Without good information about your current costs, you will not be able to project future costs with any confidence.\u00a0\u00a0<\/p>\n [\/et_pb_text][et_pb_accordion _builder_version=”4.9.2″ _module_preset=”default” locked=”off”][et_pb_accordion_item title=”10 suggested steps for an effective rate-setting process” open=”on” _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n Listed here are 10 suggested steps for an effective rate-setting process. These steps are not meant to be definitive, but rather suggest issues that need to be considered and data that needs to be gathered.<\/p>\n 1.\u00a0 Determine your costs. Your budget and record-keeping system should track costs in meaningful categories. It is helpful to separate operations costs into fixed (those costs that don\u2019t change with the amount of water produced or treated) and variable (those costs that go up when you produce more water or treat more wastewater.) It should be noted that some costs are a bit of both. In those cases, the percentage of costs can be assigned as either fixed or variable (e.g., $150,000 salary cost that is considered 90% fixed, 10% variable, would allocate $135,000 to fixed costs and the remaining $15,000 to variable.)<\/p>\n 2.\u00a0 Determine your revenues. It is helpful to understand how much of your revenue comes from usage charges versus other revenues.<\/p>\n 3.\u00a0 Determine your reserve needs. You will consult your capital improvement plan, your repair and replacement schedule, your emergency needs, and your debt obligations for this information.<\/p>\n 4.\u00a0 Determine your current financial position. Do you have a deficit? If you have not met expenses in the past, you will have to correct for this in your new rates.<\/p>\n 5.\u00a0 Determine revenue required for the next 5 years. This will be based on your past costs, but do not forget to take into account future growth and inflation.<\/p>\n 6.\u00a0 Gather information about your customers. This information is at the heart of any rate-setting process. Knowing how many customers fall into various usage categories will make it possible for you to set a rate\/fee structure that maximizes your revenue, while making sure that the cost is spread equitably among the customers.<\/p>\n 7.\u00a0 Gather information about production and use. These data will tell you whether you are \u201closing\u201d water due to leakage or theft. Or you may simply be providing water to community buildings without charge. In any case, this water costs money to produce and must be paid for by your customers. If your system does not have meters, you cannot set a meaningful rate.<\/p>\n 8.\u00a0 Design a rate\/fee structure. There are as many different structures as there are people with imagination designing them. However, an effective rate will cover all costs; will spread the cost of operations equitably across all classes of customers; will encourage conservation; and consider the goals of the utility underlying the rate structure. It is important that the utility understand its goals for the rate structure and clearly articulate them.<\/p>\n 9.\u00a0 Implement the rate. Do not underestimate the importance of \u201cselling\u201d the new rate\/fee structure to your customers. If you have already involved your customers in your Level of Service<\/a> process, it is a natural step to let them know what the services will cost<\/p>\n 10.\u00a0 Review your rates regularly. Rates should be reviewed annually.<\/p>\n [\/et_pb_accordion_item][\/et_pb_accordion][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n These resources may also prove helpful:<\/p>\n [\/et_pb_text][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” custom_margin=”||-19px|||” custom_padding=”||1px|||”]<\/p>\n <\/a>Taxes<\/b><\/p>\n Per EPA\u2019s\u00a0Guidebook\u00a0of Financial Tools<\/i><\/a>, \u201cA\u00a0tax is defined\u00a0as a financial charge or other levy imposed on an individual or legal entity by a state or a\u00a0functional equivalent of a state, such as a tribe. General taxes are levied on a very broad section\u00a0of the general public, such as wage earners or property owners. Selective sales taxes are levied\u00a0on the sale of particular commodities and services.\u00a0Revenues from taxes typically go into the\u00a0general funds for state and local governments.\u201d<\/p>\n There are any number of taxes a\u00a0government may use to generate revenue.\u00a0A water system is more likely to use the following types of taxes\u00a0(definitions from EPA\u2019s\u00a0Guidebook of Financial Tools)<\/i>:<\/p>\n [\/et_pb_text][et_pb_testimonial portrait_url=”https:\/\/swefc.unm.edu\/iamf\/wp-content\/uploads\/2021\/04\/jocokslogo-1.png” quote_icon=”off” portrait_width=”205px” portrait_height=”200px” portrait_width_tablet=”” portrait_width_phone=”194px” portrait_width_last_edited=”on|tablet” portrait_height_tablet=”” portrait_height_phone=”188px” portrait_height_last_edited=”on|tablet” _builder_version=”4.9.2″ _module_preset=”default” background_color=”rgba(217,217,217,0.6)” border_radii=”on|25px|25px|25px|25px” border_radii_portrait=”on|25px|25px|25px|25px” box_shadow_style_image=”preset1″ locked=”off”]<\/p>\n Johnson County Kansas <\/b>has 18 watersheds that drain to three major river basins.\u00a0It is the most populous county in Kansas with a population of approximately 590,000 in 20 cities and in unincorporated areas. The\u00a0unincorporated\u00a0areas are roughly 40% of the county land mass by area.\u00a0The state passed a piece of legislation that enabled counties to adopt a\u00a01\/10th<\/sup>\u00a0of one cent<\/b>\u00a0stormwater sales tax\u00a0which enabled Johnson County to\u00a0create\u00a0a Stormwater Management Program.\u00a0The program\u00a0ranks projects and\u00a0funds\u00a0those\u00a0with the highest cost benefit first.\u00a0To hold cities accountable for the projects they chose, the program now requires a match of 25% and the cities have to\u00a0administer and manage the project themselves.<\/p>\n Source: https:\/\/www.jocogov.org\/dept\/public-works\/stormwater-management\/program-overview<\/a><\/p>\n [\/et_pb_testimonial][et_pb_testimonial portrait_url=”https:\/\/swefc.unm.edu\/iamf\/wp-content\/uploads\/2021\/04\/Village-of-Riudoso.png” quote_icon=”off” portrait_width=”205px” portrait_height=”200px” portrait_width_tablet=”” portrait_width_phone=”194px” portrait_width_last_edited=”on|tablet” portrait_height_tablet=”” portrait_height_phone=”188px” portrait_height_last_edited=”on|tablet” _builder_version=”4.9.2″ _module_preset=”default” background_color=”rgba(217,217,217,0.6)” border_radii=”on|25px|25px|25px|25px” border_radii_portrait=”on|25px|25px|25px|25px” box_shadow_style_image=”preset1″ locked=”off”]<\/p>\n The Village of Ruidoso, New Mexico: In addition to user fees, Ruidoso has an additional mechanism of funding the utility, a supplemental gross receipts tax (SGRT). This supplement was passed, approved, and adopted by the Village of Ruidoso on July 6th, 1982. It was voted in by a vote of 560 to 288. The supplement is 1% of the amount of GRT reported or required to be reported by people who are subject to the New Mexico Gross Receipts and Compensating Tax Act. All of the supplemental GRT is to be dedicated to the purpose of constructing, equipping, acquiring, enlarging, improving, and extending the Ruidoso municipal water supply system. This supplemental funding, above and beyond the rate revenue received from customers, helps to ensure that the water system is financially sustainable over the long term. This funding can be used for both day to day and capital expenditures.<\/p>\n Source: January 2019 Financial Report<\/a><\/p>\n [\/et_pb_testimonial][\/et_pb_column][\/et_pb_row][et_pb_row _builder_version=”4.8.1″ _module_preset=”default” width=”100%”][et_pb_column type=”4_4″ _builder_version=”4.8.1″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default” custom_margin=”-39px|||||” custom_padding=”0px|||||”]<\/p>\n <\/a><\/p>\n Fees<\/b><\/p>\n Per EPA\u2019s\u00a0Guidebook of Financial Tools<\/i>, \u201cA fee is defined as the price one pays as\u00a0remuneration for services, such as government administrative services and utility services. Fees\u00a0are also defined as financial charges for activities undertaken, including polluting activities such\u00a0as solid waste disposal.\u00a0Revenues from fees are often deposited into\u00a0special funds related to the product or service upon which the fees are levied.\u201d<\/p>\n Examples of fees that water systems may\u00a0charge or benefit from include:<\/p>\n [\/et_pb_text][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n <\/a>R<\/span><\/b>eserves<\/span><\/b>\u00a0<\/span><\/p>\n Reserves include money that is set aside every year in a reserve account to help fund various specific purposes, such as debt service, asset repair, rehabilitation, and replacement, capital improvements, and emergencies. Funding agencies, with whom the utility has loans or grants, may have requirements for specific amounts of money that must be put into the debt service reserve or other reserves. Otherwise the reserve amounts are up to the utility. Some example amounts are shown below.<\/p>\n [\/et_pb_text][dvmd_table_maker tbl_row_header_count=”0″ tbl_chead_cell_color=”#2ea3f2″ _builder_version=”4.9.2″ _module_preset=”default” tbl_chead_text_font=”|700|||||||” background_color=”#000000″ border_width_all=”2px” border_color_all=”RGBA(0,0,0,0)” locked=”off” border_width_all__hover=”2px” border_width_all__hover_enabled=”on|hover”][dvmd_table_maker_item col_label=”Reserve Account” col_content=”Reserve Account<\/strong> <\/a>Partnerships<\/b>\u00a0(public-private partnerships, public-public)<\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row column_structure=”1_2,1_2″ _builder_version=”4.9.2″ _module_preset=”default” width=”100%” locked=”off”][et_pb_column type=”1_2″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n Mutual aid agreement partnership – Larry Covington, President, Picacho Mutual Domestic Water Association, Las Cruces, NM<\/p>\n [\/et_pb_text][et_pb_video src=”https:\/\/youtu.be\/QPnCWFzxz8A” _builder_version=”4.9.2″ _module_preset=”default” border_radii=”on|25px|25px|25px|25px”][\/et_pb_video][\/et_pb_column][et_pb_column type=”1_2″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n Working together to apply for a grant \u2013 Larry Covington, President, Picacho Mutual Domestic Water Association, Las Cruces, NM<\/p>\n [\/et_pb_text][et_pb_video src=”https:\/\/youtu.be\/0S56BnlwmS4″ _builder_version=”4.9.2″ _module_preset=”default” border_radii=”on|25px|25px|25px|25px”][\/et_pb_video][\/et_pb_column][\/et_pb_row][et_pb_row _builder_version=”4.9.2″ _module_preset=”default” width=”100%”][et_pb_column type=”4_4″ _builder_version=”4.9.2″ _module_preset=”default”][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n <\/a><\/p>\n Incentives<\/b><\/p>\n To encourage conservation, stormwater control, pollution prevention and other programs, governments, utilities, and other organizations offer financial incentives to make partnering more feasible for homes and businesses. Financial incentives can include rebates, bill reductions, fee reductions or, in some cases, tax incentives or loans. Incentives allow a system to communicate its goals and objectives through financial means. For example, if conservation is desired, incentives can be created to encourage consumers to conserve water.<\/p>\n [\/et_pb_text][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n\n
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Johnson County Kansas<\/h2>\n
The Village of Ruidoso, NM<\/h2>\n
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\nOperating cash reserve<\/strong>
\nUnscheduled\/reactive maintenance \u201cEmergency\u201d reserve<\/strong>
\nPlanned repair\/replacement reserve<\/strong>
\nPlanned capital improvements reserve <\/strong>
\nDebt service reserve<\/strong>” col_chead_cell_color=”#2ea3f2 ” _builder_version=”4.9.2″ _module_preset=”default”][\/dvmd_table_maker_item][dvmd_table_maker_item col_label=”Purpose” col_content=”Purpose
\nProvide a cushion for day-to-day expenses
\nProvide funds for unforeseen repairs or replacement
\nPurchase, repair, or rehabilitate items with typically a one- to ten-year life span
\nConstruct or upgrade facilities in response to growth or change, including new regulations; Minimize debt accumulation; Provide matching or leveraging funds to help get grants or loans; Pay for pre-construction costs such as planning, environmental assessments or preliminary engineering reports
\nEnsure funds are available to meet debt repayment terms” _builder_version=”4.9.2″ _module_preset=”default”][\/dvmd_table_maker_item][dvmd_table_maker_item col_label=”Reserve Goal” col_content=”Reserve Goal
\nThree to six months\u2019 worth of operating and preventative maintenance expenses
\nAverage expenditure for the past five years\u2019 unscheduled\/reactive repairs
PLUS an additional ten percent (10%) of that figure
PLUS the current cost of the most expensive capital item that you don\u2019t have in your spare parts inventory
\nThe amount will be guided by the future asset repair and replacement costs you have predicted as part of your asset management program or your repair and replacement schedule
\nThe amount will be guided by the future capital improvement costs you have predicted as part of your asset management program or your capital improvement plan
\nMinimum debt service reserve or debt coverage ratio will likely be specified by the loan or bond agency” _builder_version=”4.9.2″ _module_preset=”default”][\/dvmd_table_maker_item][dvmd_table_maker_item col_label=”Reserve Minimum” col_content=”Reserve Minimum
\nTwo months\u2019 worth of operating and preventative maintenance expenses
\nAn amount equal to the most recent typical years\u2019 expenditure for unscheduled\/reactive repairs
PLUS an additional five percent (5%) of that figure
OR the current cost of the most expensive capital item that you don\u2019t have in your spare parts inventory, whichever is greater
\nIf you don\u2019t have an asset management program or repair and replacement schedule, reserve an amount equal to five percent (5%) of total system replacement cost
OR reserve an amount equal to three months of operating expenses
\nTen to thirty percent (10% – 30%) of the future cost of anticipated capital projects
\nAchieve a coverage ratio* of no less than 1.25″ _builder_version=”4.9.2″ _module_preset=”default”][\/dvmd_table_maker_item][\/dvmd_table_maker][et_pb_text _builder_version=”4.9.2″ _module_preset=”default”]<\/p>\n\n
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