Galesburg Council told water fund will be depleted by 2026 without adjustment

Galesburg Council members tonight will get a presentation on the water rate study that they authorized in the summer of 2020.NewGen Strategies and Solutions will tell Aldermen that current water revenue does not support annual cash needs into the future. Going the way we are- the water fund cash balance would be depleted by 2026. Charts from NewGen show that annual revenues are just above annual expenses before costs for capital and new debt are added. The presentation will feature a 10-year $28 million Capital Improvement Plan for water infrastructure, with $18 million spent in the first 5 years. The council’s aim in ordering the study was to develop a long-term financial plan that maintains the financial health of the City’s Water Enterprise Fund and updates the rates and fees charged to the City’s customers based on industry standards. Some guiding principles for the study included that the city’s water utility must be financially self-sustaining, but also that rates for customers be kept as low as possible over the long-term. They also prioritized making water affordable for all residents, particularly low-income residents. The firm is recommending taking on $12 million in new debt which would be assumed at a rate of 3 percent over 20 years.