1 | Page
2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel 510 653 3399
www.bartlewells.com
DATE: April 8th, 2026
TO: City of Foster City/Estero Municipal Improvement District
FROM: Bartle Wells Associates
SUBJECT: Water Rate Study Update Results
SUMMARY OF FINDINGS AND RECOMMENDATIONS
Introduction and Background
The Estero Municipal Improvement District (District) engaged Bartle Wells Associates (BWA) to develop 10-year financial projections for the District's Water Enterprise. BWA most recently completed a formal rate study in 2025, resulting in a five-year rate schedule for FY 2026 through FY 2030. That study also established a pass-through provision authorizing the District to recover any wholesale rate increases above the levels projected in the study . Customers would be notified of any such pass-through adjustments at least 30 days prior to the change in rates . The purpose of this analysis is to update the District’s financial plan and to examine whether the five- year rate schedule and pass-through amounts are sufficient. This update confirms the previously adopted water rates effective July 1, 2025, with annual adjustments each July 1 through 2029 and the implementation of the pass through increase of $0 .42 per h undred cubic feet (ccf) for Fiscal Year 2027.
Current and projected water service rates are in the low range compared to other agencies on the Peninsula. However, the District faces ongoing infrastructure funding needs and increasing wholesale water costs.
Water Enterprise Summary
The primary driver of District rate increases is the impact of increases in the San Francisco Public Utilities Commission (SFPUC) wholesale water rates. SFPUC rate increases are driven by a variety of factors including debt service on existing and newly issued bonds, continued low water usage, repayment of the balancing account, and increased capital funding needs. Additionally, in recent years the District has increased the annual amount of projected capital expenditure transfers from the operating reserve fund to the capital reserve fund from $1 million to $2. 6 million on average.
2 | Page
SFPUC, the District’s sole water supplier, has finalized its wholesale rate for FY 2027. Chart A presents a summary of the projected SFPUC rates. The current wholesale rate of $5.80 per hundred cubic feet (ccf) in FY 2026 will increase by $0.43 per ccf, or 7.4%, to $6.23 per ccf in FY 2027. By comparison, the 2025 rate study projected an FY 2027 rate of $5.85 per ccf, indicating that the rate is $0.38 per ccf higher than previously anticipated. After accounting for the District’s estimated 10% system water loss, the required pass-through adjustment for FY 2027 is $0.42 per ccf to fully recover the increase in wholesale water costs.
Future increases are unknown, however, BWA factored in 3.5% annual wholesale rate increases beyond FY 2027 in this analysis , reflecting expected inflationary pressures and ongoing system costs. SFPUC rates are projected to reach approximately $7.15 per ccf by FY 2031. Any wholesale rate increases implemented by SFPUC above the 2025 study projected levels are recommended to be passed through to District customers via Government Code section 53756.
The District will also continue to make annual payments to the Bay Area Water Supply and Conservation Agency (BAWSCA) for the Water System Improvement Project (WSIP), which was financed through the issuance of bonds. These payments are projected to average approximately $650,000 annually. Water purchases from SFPUC remain the largest single expense within the District’s water enterprise. Table 5 summarizes projected wholesale water purchases and the associated pass-through calculation, and Appendix B provides detailed financial projections.
The WSIP is a multi-year capital initiative with a budget of $4.8 billion. Its goal is to enhance both the regional and local water systems managed by the SFPUC. The program focuses on repairing, replacing, and seismically upgrading critical parts of the Hetch Hetchy Regional Water System .
The WSIP encompasses 87 projects, including 35 local projects within San Francisco and 52 regional projects across seven counties, extending from the Sierra foothills to San Francisco. By October 2020, the San Francisco p ortion of the program had been fully completed. In March 2022, the SFPUC Commission approved updates to the program schedule, extending the completion of the timeline for remaining projects to February 2027.
Adopted wate r rates inclusive of the pass-through adjustment are designed to maintain the operating fund above target levels (90 days operating expenses in reserves) and cover District operating and capital costs. The District is projected to set aside approximately $11.1 million for capital improvements over the next 5 years. The capital improvement set aside amount is based on funding the District’s water master plan. Major projects include valve replacements, water tank lining and structural retrofitting, and an emergency bypass transmission main, among others. BWA projects the District will need to obtain roughly $4 million of debt financing to fund
3 | Page
the capital improvements in FY 2028. The source of the funds is unknown currently and is estimated to be a 30-year loan at 6% interest with 1.5% transaction costs for planning purposes.
Adopted water rates inclusive of the pass-through adjustment are based on 10% water loss. That is, 90% of the water EMID purchases are sold to retail customers. The losses have decreased over time due to the District’s efforts to replace aging meters. Water loss refers to the difference between the amount of water put into the distribution system and the amount of water billed to customers. This loss can be categorized into two main types:
• Real Losses: These are physical losses of water from the system due to leaks, overflows, or breaks in the water mains, service lines, and other infrastructure. Real losses can be caused by aging infrastructure, corrosion, damage, or faulty installation. • Apparent Losses: These are losses caused by non-infrastructure related incidents such as inaccuracies in metering, data handling errors, or unauthorized consumption (water theft).
The District separates its costs into variable costs (captured by a volumetric rate) and fixed costs (captured by a meter charge rate). To maintain the operating reserves, fund the capital set aside, and phase in volumetric rates, BWA recommends the District implement the adopted water rates inclusive of the FY 2027 pass-through adjustment, resulting in an estimated 9.4% volumetric rate increase and an 8% meter charge increase in FY 2027.
Under the a dopted water rates inclusive of the FY 2027 pass- through adjustment, the average monthly bill for a single -family residential customer is projected to increase by approximately $7.62 (8.9%).
Rate Survey
A survey of communities along the San Francisco Peninsula was conducted to compare the District’s typical residential monthly water bills with neighboring communities. The results of the water survey are shown in Appendix A.
The water survey compares a monthly water bill for 8 units (1 unit = 1 ccf) of water which would be a common residential consumption. Including the adopted increase and FY 2027 pass-through adjustment, the District’s average monthly water bill for FY 202 7 is $93.32. Since it is unknown what the comparator agencies are proposing for FY 202 7, the District compares its FY 202 6 monthly residential water bills to the FY 2026 monthly residential water bills for the neighboring agencies. The survey indicates that the District’s water rates are among the lowest on the
4 | Page
Peninsula. The average monthly water bill for the region based on 8 ccf is $122.26 per month and the District’s average monthly residential water bill is $85.70 per month, or about 30% less. Since the adopted rates inclusive of the 2027 pass-through adjustment are also less than the FY 202 6 average, EMID customers will continue to pay lower than average water bills.
Water Enterprise Fund
The District currently provides water service to a population of approximately 3 6,500. Most of the District’s customers are residential. Table 1 shows approximately 8,296 accounts/meters that allow for water service and fire protection service.
Meter ratios reflect the proportionate volume of water that may flow through the various meter sizes. The total 3/4” meter equivalents in the District amounts to 20,234 based on industry standard meter ratios established by the American Water Works Association (AWWA).
Private fire meter ratios are set at 35% of regular meter ratios due to lower usage frequency, as they are primarily for emergency use. Fire meters are often on standby and only used during fire emergencies, resulting in less operational time and reduced maintenance and inspection requirements compared to regular water meters. Fire service lines of 1 -1/2" and smaller diameters often have similar flow rates and pressure requirements, making it practical to treat them as a single category for cost and rate purposes.
The District’s service area includes Foster City and the Mariner’s Island area, as shown in Appendix C.
5 | Page
The District’s minimum operating reserve target is set at 25% of annual operating expenses, equivalent to approximately $4.73 million in FY 2026 or about 90 days of operating expenditures.
This target is intended to maintain sufficient liquidity to address unexpected costs or revenue fluctuations.
As shown in Appendix B, for FY 2026, the District maintained an O&M reserve balance of $8,583,187 (approximately 163 days). This balance is projected to be drawn down to $6,829,676 (approximately 122 days) in the following year, which remains above the minimum target.
Table 1
City of Foster City / Estero Municipal Improvement District Water Meters By Size
Data as of: 03/06/26
Water Service
3/4" 6,826 1.00 6,826
1" 473 1.67 788
1-1/2" 182 4.00 728
2" 379 5.33 2021
3" 89 11.67 1038
4" 61 21.00 1281
6" 39 46.67 1820
8" or greater 19 80.00 1,520
Subtotal 8,068 16,022
Private Fire Protection Service
1-1/2" & below 11 1.40 15
2" 0 1.87 0
3" 2 4.08 8
4" 35 7.35 257
6" 95 16.33 1,551
8" or greater 85 28.00 2,380
Subtotal 228 4,212
Total 8,296 20,234
[2] Private fire protection service ratio based on the fire service line; Resolution No. 2715 [3] Equals the number of accounts multiplied by the meter ratio for each meter size.
Meter Size Accounts Meter Ratio1,2 Est. Meter Equivalents3 [1] The meter ratios shall be based on meter size in compliance with ratios established by the American Water Works Association (AWWA) Sizing Water Service Lines and Meters M22, Second Edition, 2004 (M22 Manual).
6 | Page
Table 2 summarizes the current and adopted water rates. The District incurs variable expenditures that are driven by customer water use, and these costs are recovered through the volumetric water charge, which is $6.80 per ccf in FY 2026. The District’s meter charges recover fixed expenditures through monthly charges, which are $31.30 for a ¾-inch meter in FY 2026.
7 | Page
Table 2
City of Foster City / Estero Municipal Improvement District Adopted Rates (Excludes Wholesale Passthrough)
F
iscal Year Ending (FYE) 2026 2027 2028 2029 2030
Fixed Meter Charge
Monthly Meter Charge
Meter Size
3/4" $31.30 $33.80 $36.15 $38.70 $41.40
1" 52.17 56.33 60.25 64.50 69.00
1-1/2" 125.20 135.20 144.60 154.80 165.60
2" 166.93 180.27 192.80 206.40 220.80
3" 365.17 394.33 421.75 451.50 483.00
4" 657.30 709.80 759.15 812.70 869.40
6" 1,460.67 1,577.33 1,687.00 1,806.00 1,932.00
8" or greater 2,504.00 2,704.00 2,892.00 3,096.00 3,312.00 Bi-Monthly Water Consumption Tiers and Rates
Single Family Residential
Tier 1 0-20 per ccf $6.80 $7.02 $7. 29 $7.56 $7.84
Tier 2 Over 20 ccf 7.56 7.79 8.08 8.34 8.59
Multi-Family Residential
Tier 1 0-10 ccf per living unit 6.80 7.02 7. 29 7.56 7.84 Tier 2 Over 10 ccf per living unit 7.54 7.77 8.06 8.32 8.57 Irrigation Customers
Tier 1 <=100% of annual budget 6.80 7.02 7. 29 7.56 7.84 Tier 2 >100% of annual budget 7.76 8.00 8.29 8.55 8.79 Commercial and Fire Line
All usage 6.92 7.14 7. 41 7.68 7.96
Monthly Private Fire Protection Charge
Meter Size
1-1/2" & below $43.82 $47.32 $50.61 $54.18 $57.96
2" 58.53 63.21 67.60 72.37 77.42
3" 127.70 137.90 147.49 157.90 168.91
4" 230.06 248.43 265.70 284.45 304.29
6" 511.13 551.95 590.33 631.97 676.06
8" or greater 876.40 946.40 1,012.20 1,083.60 1,159.20
8 | Page
Table 3 summarizes the District’s projected operating expenses for the water enterprise. Total O&M expenditures ae projected to increase from approximately $19.4 million in FY 2026 to $20.6 million in FY 2027. The increase is primarily driven by rising wholesale water costs and ongoing system maintenance needs.
Table 3
City of Foster City / Estero Municipal Improvement District Water Enterprise O&M Projection
Revised
Budget
FY2026 FY2027 FY2028 FY2029 FY2030 FY2031
Employee Services $3,343,722 $3,495,140 $3,634,946 $3,780,343 $3,931,557 $4,088,819 4.0% Additional Cost [2] - - 313,542 324,103 335,045 348,447 varies Internal Services - Others 1,447,560 1,213,559 1,243,898 1,274,995 1,306,870 1,339,542 2.5% Internal Services - Equipment 396,971 396,971 406,895 417,068 427,494 438,182 2.5% Services & Supplies 804,062 980,562 1,005,076 1,030,203 1,055,958 1,082,357 2.5% SFPUC Water Purchases 11,141,880 12,011,873 12,477,954 12,962,120 13,465,074 13,987,544 varies BAWSCA Bond Repayment 670,356 646,980 646,980 646,980 646,980 646,980 Reallocation [3] 1,363,200 1,653,666 1,695,008 1,737,383 1,780,817 1,825,338 2.5% Water Sustainability 250,000 250,000 250,000 250,000 250,000 250,000 Capital Outlay/Vehicles - - - - - -
TOTAL O&M Expenditures 19,417,751 20,648,751 21,674,298 22,423,195 23,199,796 24,007,209
6.3% 5.0% 3.5% 3.5% 3.5%
[1] Based on City/District Staff direction
[2] A placeholder for potential additional positions to support the water enterprise Five Year ProjectionExpenditures Annual %
Increase [1]
[ ] p p p y y p
as documented in the City’s cost allocation study.
9 | Page
District Water Usage
Table 4 shows the District’s historical water use trends from prior years and projected usage for FY 2026. District rates are designed to match volumetric expenses (such as water purchases) with volumetric revenue. The rate structure mitigates over or under collecting revenue due to fluctuations in water use.
Table 4
City of Foster City / Estero Municipal Improvement District Water Consumption by Class
Water Consumption
Bi-Monthly
Customer Category Breakpoints (CCF) CCF Percent CCF Percent CCF Percent CCF Percent
RESIDENTIAL
Single Family Residential
Tier 1 Usage
0 to 20 331,014 85% 331,395 84% 335,788 83% 335,788 83% Tier 2 Usage 21 and over 59,618 15% 61,126 16% 68,938 17% 68,938 17% Subtotal 390,632 100% 392,521 100% 404,726 100% 404,726 100% Multi-Family Residential
Tier 1 Usage 0 to 10 500,442 84% 516,443 84% 512,942 82% 512,942 82% Tier 2 Usage 11 and over 95,037 16% 100,082 16% 114,057 18% 114,057 18% Subtotal 595,479 100% 616,525 100% 626,999 100% 626,999 100%
NON-RESIDENTIAL
Commercial All usage 201,310 228,762 232,760 232,760
Fire Line All usage 3,646 3,039 12,570 12,570
Irrigation
Tier 1 <=100% of budget 345,633 94% 369,418 88% 423,531 96% 423,531 96% Tier 2 >100% of budget 21,285 6% 52,147 12% 15,694 4% 15,694 4% 366,918 100% 421,565 100% 439,225 100% 439,225 100%
Total Consumption 1,716,280 1,716,2801,662,4121,557,985 FY 2023 FY 2024 Projected FY 2026FY 2025
10 | Page
SFPUC Wholesale Rate Passthrough
SFPUC establishes the wholesale water rate for each unit of water purchased by the District, which supplies 100% of the District’s water. If SFPUC increases the wholesale rate, the District is authorized to pass through the increase to customers in accordance with Government Code section 53756.
The pass-through amount is calculated as the difference between the actual SFPUC rate and the rate projected in the study, adjusted for system water losses. Specifically, the formula is:
Additional SFPUC cost per ccf above study projections ÷ 0.9
The 0.9 factor reflects the District’s estimated 10% water loss, meaning approximately 90% of purchased water is billed to customers. The District will provide at least 30 days’ notice prior to implementing any pass-through adjustment and will not convene an additional public hearing for such changes.
For example, if the SFPUC rate in FY 2027 is $6.23 per ccf, compared to the projected rate of $5.85 per ccf, the pass-through is calculated as follows:
($6.23 − $5.85) ÷ 0.9 = $0.42 per ccf
This results in an additional $0.42 per ccf applied to all volumetric water rates.
The adjustment for water loss ensures that the District recovers the full cost of purchased water.
Because approximately 90% of purchased water is billed to customers, the cost increase must be recovered over that reduced sales volume. As a result, each unit sold must recover slightly more than the direct increase in wholesale cost, which is reflected by dividing the increase by 0.9.
Table 5 summarizes both projected wholesale water purchases and the calculation of the FY 2027 pass-through adjustment. The table presents the SFPUC wholesale rate projected in the 2025 study, the FY 2027 rate, and the resulting difference in cost per ccf. This difference is then adjusted for the District’s estimated 10% system water loss by dividing by 0.9, reflecting that approximately 90% of purchased water is billed to customers.
Table 5 also presents projected wholesale water costs in future years for financial planning purposes. Any future pass-through adjustment would depend on the difference between SFPUC’s adopted rates and the levels assumed in the study.
11 | Page
Table 5
City of Foster City / Estero Municipal Improvement District Wholesale Water Cost Projection
W a te r Loss % 10.0%
Year ending June 30 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Annual growth rate 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% Water purchases (ccf) 1,906,978 1,914,034 1,921,116 1,928,224 1,935,358 1,942,519 1,949,706 1,956,920 1,964,161 1,971,428 Water sales (ccf) 1,716,280 1,722,630 1,729,004 1,735,401 1,741,822 1,748,267 1,754,736 1,761,228 1,767,745 1,774,285 SFPUC Wholesale Water Cost Projections
SFPUC charges for base fiscal year ending June 30:
Year ending June 30: 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 SFPUC fixed charge $81,409 $87,444 $90,505 $93,672 $96,951 $100,344 $103,856 $107,491 $111,253 $115,147 SFPUC rate/ccf increase 2.3% 7.4% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% Projected rate per ccf 5.80 6.23 6.45 6.67 6.91 7.15 7.40 7.66 7.93 8.20 BAWSCA Cost Projection 670,356 646,980 646,980 646,980 646,980 646,980 646,980 646,980 646,980 646,980 SFPUC cost projection 11,141,880 12,011,873 12,477,954 12,962,120 13,465,074 13,987,544 14,530,290 15,094,096 15,679,780 16,288,192 Previous Study Projected SFPUC Rates $/ccf 5.79 5.85 5.91 6.22 6.72 6.96 7.20 7.45 7.71 7.98 Estimated Passthrough $/ccf (Rate Differential/0.9) 0.42 0.60 0.50 0.21 0.22 0.22 0.23 0.24 0.25 Passthrough Additional Annual Revenue 723,505 1,037,402 867,701 365,783 384,619 386,042 405,082 424,259 443,571 Projected
12 | Page
Chart A, below, graphically shows SFPUC’s current estimates of future wholesale water purchase rates through FY 2031. The SFPUC rates are currently projected to increase from $6.23/ccf in FY 2027 to $6.91/ccf in FY 2030. This compares to the SFPUC rates estimated at the time the water rates were approved in 2025 when the rates were projected to increase from $5.85/ccf in FY 2027 to $6. 72/ccf in FY 20 30. Each year, EMID will calculate the passthrough rate by comparing the updated costs from SFPUC to the costs that were estimated at the time the water rates were approved.
CHART A
2.93 2.45
2.93 3.75
4.10 4.10 4.10 4.10 4.10 4.10
4.75 5.21
5.67 5.80
6.23 6.45 6.67 6.91 7.15
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
FY2013
FY2014
FY2015
FY2016
FY2017
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
FY2024
FY2025
FY2026
FY2027
FY2028
FY2029
FY2030
FY2031
SFPUC Wholesale Water Rates ($ per ccf)
SFPUC Historical Rates
Rates Effective July 1
SFPUC Projected Rates
SFPUC wholesale rate projections as of April 2026. BWA estimates 3.5% increases beyond FY 2028.
13 | Page
APPENDIX A
19.62 31.30
33.80 30.60
33.53 27.63
42.02 46.19
30.45 30.09
36.91 80.59
32.10 41.43
92.68 54.45
54.40 59.52
65.18 69.04
78.08 65.71
73.44 92.35
95.13 91.54
60.72 115.28
132.24
88.90 $74.07
$85.70
$93.32 $95.78
$102.57 $105.71 $107.72
$119.63 $122.80 $125.22 $128.45
$141.31
$147.38
$173.67
$181.58
$0
$25
$50
$75
$100
$125
$150
$175
$200
Fixed Monthly Charges
Water Usage Charges
Typical Single Family Residential Monthly Water Charges Base meter size with 8 hcf of monthly water use
Typical Single Family Residential Monthly Water Charges Base meter size with 8 hcf of monthly water use
Typical Single Family Residential Monthly Water Charges Base meter size with 8 hcf of monthly water use
Average: $122.26
14 | Page
APPENDIX B
Table B-1
City of Foster City / Estero Municipal Improvement District Water Enterprise Cash Flow Projection - Wholesale Passthrough Fiscal Year Ending June 30 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Assumptions:
Interest Earnings Rate 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Revenue Increase from Growth [1] 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% 0.37% Fixed Charge $31.30 $33.80 $36.15 $38.70 $41.40 $43.05 $44.75 $46.55 $48.40 $50.35 Fixed Rate Adjustment 8.5% 8.0% 7.0% 7.1% 7.0% 4.0% 3.9% 4.0% 4.0% 4.0% SFR Adopted Variable Charge $6.80 $7.02 $7.29 $7.56 $7.84 $8.17 $8.44 $8.72 $9.01 $9.31 SFR Est. Variable Passthrough Rate $0.42 $0.60 $0.50 $0.21 $0.22 $0.22 $0.23 $0.24 $0.25 Total Variable Charge $7.44 $7.89 $8.06 $8.05 $8.39 $8.66 $8.95 $9.25 $9.56 Variable Rate Adjustment 3.0% 9.4% 6.0% 2.2% -0.1% 4.2% 3.2% 3.3% 3.4% 3.4% Monthly Service Charge Single Family (8 ccf) $85.70 $93.32 $99.27 $103.18 $105.80 $110.17 $114.03 $118.15 $122.40 $126.83 Rate Adjustment 5.0% 8.9% 6.4% 3.9% 2.5% 4.1% 3.5% 3.6% 3.6% 3.6% Beginning Fund Balance $10,823,595 $8,583,200 $6,829,700 $9,286,700 $7,924,300 $7,273,600 $7,188,400 $7,253,700 $7,505,200 $7,957,700 Revenues
Water Sales & Service Charges
Meter Charge Revenue Estimate 7,600,338 8,237,735 8,843,089 9,501,905 10,202,435 10,648,307 11,109,752 11,599,384 12,104,993 12,639,287 Volumetric Revenue Estimate 11,852,005 12,276,988 12,793,247 13,307,131 13,837,869 14,466,000 14,993,000 15,537,000 16,107,000 16,699,000 Estimated Passthrough Revenue 723,505 1,037,402 867,701 365,783 384,619 386,042 405,082 424,259 443,571 Debt Issuance / Interfund Loan 0 0 4,000,000 0 0 0 0 0 0 0 Connection Fees [1] 0 0 0 0 0 0 0 0 0 0
Interest Earnings - Operating Reserve [2] 325,000 257,000 205,000 279,000 238,000 218,000 216,000 218,000 225,000 239,000 Other 0 0 0 0 0 0 0 0 0 0
Operating Revenues 19,777,343 21,495,227 26,878,739 23,955,737 24,644,087 25,716,926 26,704,794 27,759,467 28,861,252 30,020,858 Expenses
Employee Services 3,343,722 3,495,140 3,634,946 3,780,343 3,931,557 4,088,819 4,252,372 4,422,467 4,599,366 4,783,340 Additional Cost 0 0 313,542 324,103 335,045 348,447 362,384 376,880 391,955 407,633 Internal Services - Others 1,447,560 1,213,559 1,243,898 1,274,995 1,306,870 1,339,542 1,373,031 1,407,356 1,442,540 1,478,604 Internal Services - ERF 396,971 396,971 406,895 417,068 427,494 438,182 449,136 460,365 471,874 483,671 Services & Supplies 804,062 980,562 1,005,076 1,030,203 1,055,958 1,082,357 1,109,416 1,137,151 1,165,580 1,194,720 SFPUC Water Purchases 11,141,880 12,011,873 12,477,954 12,962,120 13,465,074 13,987,544 14,530,290 15,094,096 15,679,780 16,288,192 BAWSCA Bond Repayment 670,356 646,980 646,980 646,980 646,980 646,980 646,980 646,980 646,980 646,980 Reallocation 1,363,200 1,653,666 1,695,008 1,737,383 1,780,817 1,825,338 1,870,971 1,917,746 1,965,689 2,014,831 Capital Outlay / Vehicles 0 0 0 0 0 0 0 0 0 0
Operating Expenses 19,167,751 20,398,751 21,424,298 22,173,195 22,949,796 23,757,209 24,594,580 25,463,040 26,363,764 27,297,971 Operating Net Revenues 609,592 1,096,476 5,454,441 1,782,541 1,694,291 1,959,717 2,110,214 2,296,426 2,497,487 2,722,887 Water Sustainability Fund Transfer 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 Capital Improvement Transfer [3] 2,600,000 2,600,000 2,600,000 2,600,000 1,800,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 Proj. Debt Service (6%, 1.5% issuance, 30yr) 0 0 147,477 294,955 294,955 294,955 294,955 294,955 294,955 294,955 Total Expenses 22,017,751 23,248,751 24,421,775 25,318,150 25,294,750 25,802,164 26,639,535 27,507,995 28,408,719 29,342,926 Revenues Less O&M Expenses 609,592 1,096,476 5,454,441 1,782,541 1,694,291 1,959,717 2,110,214 2,296,426 2,497,487 2,722,887 Revenues Less Total Expenses (2,240,408) (1,753,524) 2,456,964 (1,362,413) (650,664) (85,238) 65,259 251,472 452,533 677,933 Ending Fund Balance 8,583,187 6,829,676 9,286,664 7,924,287 7,273,636 7,188,362 7,253,659 7,505,172 7,957,733 8,635,633 Revenue Test: Annual Revenues > O&M Expenses
Annual Revenues Less O&M Expenses 609,592 1,096,476 5,454,441 1,782,541 1,694,291 1,959,717 2,110,214 2,296,426 2,497,487 2,722,887 Pass/fail PASS PASS PASS PASS PASS PASS PASS PASS PASS PASS Fund Reserve Test: Minimum Fund Balance >
25% O&M Expenses
Year-end fund balance 8,583,187 6,829,676 9,286,664 7,924,287 7,273,636 7,188,362 7,253,659 7,505,172 7,957,733 8,635,633 25% operating expenses 4,730,000 5,030,000 5,280,000 5,470,000 5,660,000 5,860,000 6,060,000 6,280,000 6,500,000 6,730,000 # of Days O&M in Reserves 163 122 158 130 116 110 108 108 110 115 Pass/fail PASS PASS PASS PASS PASS PASS PASS PASS PASS PASS Debt Service Coverage 9.86 6.04 5.74 6.64 7.15 7.79 8.47 9.23 [1] Connection fees not included in this analysis
[2] Calculated as 3% of the Beginning Fund Balance of the Water Revenue Fund [3] Capital Improvements are funded through the Long-Term Capital Improvement Project Fund Five Year Projection Extended Year Projection
15 | Page
Table B-2
Foster City / Estero Municipal Improvement District
Projected Water Rate Impacts (Including Projected Passthrough) Current FY2027
Rates Two Tier Hybrid Model
Monthly meter charge $31.30 $33.80
% Change 8.0%
Single Family Residential
Bi-Monthly Tiers
Tier 1: 0 to 20 ccf $6.80 $7.44
Tier 2: over 20 ccf $7.56 $8.21
Water Monthly
Use Level Use (ccf) Monthly Bill
Low User 5 $65.30 $71.00
$ Increase 5.70
% Increase 8.7%
Median User 6 $72.10 $78.44
$ Increase 6.34
% Increase 8.8%
Average User 8 $85.70 $93.32
$ Increase 7.62
% Increase 8.9%
High User 10 $99.30 $108.20
$ Increase 8.90
% Increase 9.0%
Very High User 20 $167.30 $190.30
$ Increase 23.00
% Increase 13.7%
Excessive User 50 $394.10 $436.60
$ Increase 42.50
% Increase 10.8%
Table B-3
Foster City / Estero Municipal Improvement District
P
rojected Water Rate Impacts
Current
2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Monthly Rate Impacts (Including Projected Passthrough)
Single Family Residential Monthly Rate $85.70 $89.96 $94.47 $99.18 $104.12 $108.41 $112.27 $116.31 $120.48 $124.83 Pass Through Amount 3.36 4.80 4.00 1.68 1.76 1.76 1.84 1.92 2.00 Total 93.32 99.27 103.18 105.80 110.17 114.03 118.15 122.40 126.83 $ Increase 7.62 5.95 3.91 2.62 4.37 3.86 4.12 4.25 4.43 % Increase 8.9% 6.4% 3.9% 2.5% 4.1% 3.5% 3.6% 3.6% 3.6% Based on Single Family Residential Use of 8 ccf
Projected Water Bills Fiscal Year Ending June 30 Extended Year Projection
16 | Page
APPENDIX C