[The budget was] presented to the board of the Pagosa Area Water Sanitation District (PAWSD) on Sept. 21.
The PAWSD budget includes four funds: a general, debt service, water enterprise and wastewater enterprise.
In a follow-up phone call with The SUN, Business Services Manager Shellie Peterson explained some of the larger changes for each portion of the budget…
Water enterprise fund
There were also a few notable proposed changes to the water enterprise fund.
“There are a lot of similarities to the water fund and the wastewater fund,” she said.
Both are proprietary funds, she explained.
“These are supposed to be run as you would a private business, meaning that the amount that you charge for service charges in all of your different revenues, ideally, should cover all of your related operating expenses and your capital expenditures and the debt service that’s involved with the enterprise funds,” she said.
Peterson noted that PAWSD can transfer from the general fund up to 9.99 percent of a funds’ revenues.
“So in doing that in a small way we’re subsidizing the enterprise funds with a little bit of tax dollars,” she said.
Capital projects was also included on the water enterprise fund as having a projected negative 35 percent change for 2018.
This projected change would move the capital projects budget from $428,211 in 2017 to $279,890 in 2018.
According to the draft budget summary sheet, there is a distinct decrease in capital expenditures, but many of the decreases are off- set by “increases in major mainte- nance item expenditures.”
“We’re projecting to spend less on capital next year,” she said.
In an email to The SUN Peterson explained that the reason for spending less on capital is that some years present a bigger need for capital projects than others.
“There really is not a ‘why’ to capital spending. Some years present the need for major new construction or processes more so than others,” Peterson wrote.
Water loss was also listed as a larger maintenance item in the draft budget.
“During the restructuring of the Colorado Water Conservation Board loan for the Dry Gulch prop- erty, a commitment was made to spend $125,000 per year on water line replacement or repairs to re- duce water loss,” she wrote.
Peterson noted that the water line replacement or repairs are not capital expenditures.
“They will not be capitalized and depreciated over a useful life,” she wrote.
The next big capital project will be the installation of ultraviolet disinfection at the San Juan Water Treatment Plant.
“That work is being engineered this year, dirt work, excavation will be started next year, and the UV project itself will be bid out in 2019,” she wrote.
The ending fund balance for the water enterprise fund is projected to have a 12 percent increase.
This would raise the balance up from $5,061,503 in 2017 to $5,666,128 in 2018.
“That’s saying if everything went exactly according to this formula I would have just over $5 million at the end of 2017, in this fund, and then yet I’m projecting to have a 12 percent increase in that ending fund balance,” she explained.
Why the fund balance is going to go up involves a few things, Pe- terson noted.
“Part of the reason that the fund balance is going to go up is because my revenues are going to go up just a titch, but my expenses are going to go up too, just a little bit,” she said.
Wastewater enterprise fund
Peterson explained that the wastewater enterprise fund and the water enterprise fund work in the same way, but offer different services.
“They operate identically other than the fact that they provide two completely different services,” Peterson said.
The majority of revenue that the wastewater fund receives is from the minimum monthly ser- vice charge for wastewater, she explained.
“The wastewater fund is less complicated because it’s a flat rate, everyone who is connected to Pagosa Area Water sewer is paying $32 per equivalent unit,” she said. The wastewater fund’s revenue is easier to determine because it doesn’t have a oating volumetric rate that the water enterprise fund has, Peterson noted.
Two of the bigger proposed percentage changes within the wastewater enterprise fund were wastewater collection and capital projects.
Wastewater revenue is projected to increase by 42 percent for 2018. The potential increase would move wastewater’s budget of $458,300 in 2017 to $652,935 in
“It means we are expecting our expenses to be higher in that department,” she said.
Collection of wastewater in- volves everything that happens in the collection system, the pipes underground, to bringing the sewage to the sewer plant, Peterson explained.
“We expect to go out to bid on $200,000 basis to have a commer- cial sewer line cleaning service come in,” she said.
The company responsible for the line cleaning would spray the sewer lines clean, and install cameras and create tapes from the cameras, Peterson explained.
With these tapes, PAWSD could see any potential problems within the sewer line, she explained.
Right now PAWSD is using local firm, Pagosa Rooter, to clean its sewer lines.
“They just aren’t able to televise for us, but we’ve been doing cleaning that way,” she said.
The problem for PAWSD is that it is harder to have larger firms come to Pagosa Springs because they won’t mobilize for that small amount of work.
“That’s the lion share of why that budget is going to increase,” Peterson said.
Another reason for the increase for wastewater revenue is having lift station rehab at lift station 21 and lift station 7, Peterson ex- plained.
Capital projects was again listed under this section of the budget.
Capital projects is proposed to have a 59 percent decrease in the proposed budget, from $371,525 in 2017 to $153,320 in 2018.
“In the capital department, we just have less being forecast, really where the big dollars are this year is more in the maintenance line,” Peterson said.
Both the water and wastewater funds stay at close to the same level of total expenditures, but the weighting is changed for this year, she said.