Page 19 - CityofColleyvilleFY23AdoptedBudget

Prior to scal year 2016, the Colleyville Utility System operated on a much more traditional, tiered rate structure. Based
on an inclining scale from 1,501 gallons used to over 50,000 gallons used, the rates were initially intended to encourage
water conservation. In actuality, this resulted in the utility earning far more in revenue than it needed. The years of cash
surpluses built up to a point where it was obvious the rate philosophy wasn’t working as intended. A consultant was
hired and a citizens rate advisory committee was formed to tackle the issue. The nal recommendation was to cover
the utility’s costs with static base rates based on meter size for both operational and capital expenses and to pass
through the Trinity River Authority’s volumetric costs with a rate based on consumption. The base rates are reviewed
annually during the budget process. This year, staff and Council determined that modest increases in the operating
and capital (CIP) rates were warranted. Below is a comparison of the monthly rates for scal years 2022 and 2023. It
should be noted that approximately 96% of all customers in Colleyville have a meter size of 1” or less.

Water Meter
Size 1" Meter 1.5" Meter 2" Meter 3" Meter 4" Meter
$14.06 $28.12 $45.00 $84.37 $140.61
FY 2022 Water
$14.83 $29.65 $47.45 $88.96 $148.27
FY 2023 Water
$0.77 $1.53 $2.45 $4.59 $7.66
Increase

$12.32 $12.32 $12.32 $12.32 $12.32
FY 2022
Wastewater
$13.30 $13.30 $13.30 $13.30 $13.30
FY 2023
Wastewater
$0.98 $0.98 $0.98 $0.98 $0.98
Increase

$5.83 $10.79 $16.75 $30.65 $50.49
FY 2022 CIP
$5.83 $10.79 $16.75 $30.65 $50.49
FY 2023 CIP
$0.00 $0.00 $0.00 $0.00 $0.00
Increase

$32.21 $51.23 $74.07 $127.34 $203.42
FY 2022 Total
$33.96 $53.74 $77.50 $132.91 $212.06
FY 2023 Total
$1.75 $2.51 $3.43 $5.57 $8.64
Increase

Expenditures
Utility Fund expenditures total $19,832,854 for the scal year 2023 budget. There is no utility-supported bonded debt
obligation, as scal year 2018 was the last year of debt payments for the Utility Fund. The largest component, 77
percent of the fund, covers the contractual obligation for water and wastewater to the TRA.

DEBT SERVICE FUND

The City budgets for tax-supported debt in the Debt Service Fund. The total scal year 2021 Debt Service Fund
expenditure budget is $769,010. Prior to FY23, the City had been focused on paying off all outstanding debt and
nancing all capital needs going forward with cash. However, an opportunity arose to purchase a church campus and
the 15 acre property and renovate it for the purpose of a modest recreation center. Seeing as how this had been a
desire for the community for years, Council and staff opted to sell a little over $10 million in bonds to nance the
project. These bonds will be callable in 2030. All other capital projects are anticipated to be funded using cash on hand.

Furthermore, the city’s bond ratings are evidence of Colleyville’s nancial strength. Currently, all debt obligations of the
City are rated AAA by Fitch Ratings and Standard and Poor’s. At the beginning of FY23, the City received a
con rmation in its general obligation bond rating at AAA from Standard and Poor’s, which is the strongest possible
municipal rating available. Strong tax base growth coupled with a low tax rate, strong nancial performance, and
substantial cash balances were the primary reasons for the bond rating. These credit ratings for outstanding debt
mean the City’s bonds are considered to be of superior investment quality, resulting in lower interest payments for the
City.

City of Colleyville | Budget Book 2023 Page 19