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8.A. - Page 60
<br /> Projection of Revenues,Expenses and Debt Service Coverage
<br /> Estimated projected operating results and debt service coverage for the City for the
<br /> current and next four Fiscal Years are set forth below. Certain assumptions have been made by
<br /> the City in the development of the projections, such a expected increases in revenues from new
<br /> planned developments and steady water rate increases. Many of these assumptions are
<br /> reflected in the projections. While the City believes its assumptions are reasonable, there can be
<br /> no assurance that the assumed conditions will in fact occur. The City's projections may be
<br /> affected (favorably or unfavorably)by unforeseen future events. Therefore, the results projected
<br /> below cannot be assured.
<br /> Table 18
<br /> Projection of Revenues,Expenses and Debt Service Coverage
<br /> Fiscal Years Ended June 30,
<br /> FISCAL YEAR
<br /> 2015 2016 2017 2018 2019
<br /> GROSS REVENUES
<br /> Charges for services(1) $35,773,000 $37,488,000 $38,556,000 $40,467,000 $41,581,000
<br /> Non-operating Income 200,000 170,000 205,000 239,000 312,000
<br /> TOTAL GROSS REVENUES 35,973,000 37,658,000 38,761,000 40,706,000 41,893,000
<br /> MAINTENANCE AND OPERATION
<br /> COSTS(2) 25,773,000 29,482,000 29,497,000 30,627,000 33,354,000
<br /> NET REVENUES AVAILABLE FOR
<br /> DEBT SERVICE 10,200,000 8,176,000 9,264,000 10,079,000 8,539,000
<br /> 2006 Installment Payments 1,569,000 265,378(3) — — —
<br /> 2007 Installment Payments 949,000 946,000 948,000 949,000 946,000
<br /> 2013 Installment Payments 2,059,000 2,058,000 2,063,000 2,061,000 2,060,000
<br /> 2015 Installment Payments(4) — 1,209,110 1,469,450 1,470,050 1,469,650
<br /> TOTAL DEBT SERVICE(4) 4,577,000 4,478,488 4,480,450 4,480,050 4,475,650
<br /> DEBT SERVICE COVERAGE 2.23x 1.83x 2.07x 2.25x 1.91x
<br /> Source:City of Redwood City,Administration.
<br /> (1) Charges for Service include those charges shown in Table 9 and 10 and other miscellaneous charges for Service.
<br /> Charges for Services includes a 9% water rate increase for Fiscal Year 2015-16 which was approved and adopted
<br /> by the City Council on June 10,2013. Charges for Services for Fiscal Years 2016-17,2017-18 and 2018-19 include
<br /> assumed rate increases of 5.5%, 5.5% and 3%, respectively, but these increases have not been reviewed or
<br /> approved by the City Council.Such increases,if approved,could be higher or lower.
<br /> (2) Excludes depreciation and amortization.Maintenance and Operation costs are assumed to increase 4%annually.
<br /> (3) This amount represents accrued interest on the August 1,2015,Installment Payment that will be contributed by
<br /> the City to the refunding escrow for the 2006 Bonds.
<br /> (4) Preliminary,subject to change.
<br /> INVESTMENT OF CITY FUNDS
<br /> Revenues collected by the City will be held and invested by the City in accordance with
<br /> the provisions of the Indenture.
<br /> Funds held by the City, including Enterprise moneys, are invested in accordance with
<br /> the City's Statement of Investment Policy (the "Investment Policy") prepared by the City
<br /> Treasurer as authorized by section 53601 of the Government Code of California. The Investment
<br /> Policy is submitted to the City Council annually. The Investment Policy allows for the purchase
<br /> of a variety of securities and provides for limitations as to exposure, maturity and rating which
<br /> vary with each security type. The composition of the portfolio will change over time as old
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