Revenue Trends

Enterprise Funds

Cemetery Charges for Services

Cemetery revenues are generated from various fees to recover costs related to the operation and maintenance of the Hallandale Beach cemetery, which is owned by the City. Fees include burial permits, purchase of burial space (both residential and nonresidential), interment fees, and sales of vaults, niches, and markers.

Projection Methodology: The FY 2023-24 Adopted budget is based on trend analysis and being conservative; a decrease of $12,318 or 4.2%.

Sanitation Charges for Services

The City provides timely sanitation services to the residents and businesses of Hallandale Beach. Sanitation revenues are currently generated by different user fees established for residential, multi-family and commercial garbage and recyclable collection and disposal services. Residential accounts are billed $27.87 monthly and defined as dwellings with four or less units. The rates vary for the other types of users. Sanitation revenues also include a late payment penalty charge of 10% of the current unpaid balance, charges for bulk trash and yard waste collection services; as well as dumpster rentals, which range from one to forty cubic yards.

Projection Methodology: The FY 2023-24 Adopted budget include a growth rate of 4.6% or $300,496.

Stormwater Charges for Services

The City is responsible for the cleaning, installation, and maintenance of the City’s stormwater drainage system to alleviate flooding, as well as for the maintenance of numerous pump stations. Revenues are generated through monthly stormwater drainage user fees based on an equivalent residential unit (ERU). In the FY 23/24 Proposed Budget, there is a proposal to increase the Stormwater Drainage Fee for single-family residential properties (classified as one ERU) from $97.32 to $107.04 annually, or $8.92 monthly. This is due to Properties other than residential will be billed based on their calculated equivalent number of ERU's. Stormwater fees also include a late payment penalty charge of 10% of the current unpaid balance.

Projection Methodology: The FY 2023-24 Adopted budget is based on the rate feasibility study that was completed in 2022 providing for an increase in revenues of $757,421 or 16%.

Water and Sewer (Utility) User Charges for Services

The primary source of revenue generated in the Utility Fund are the water and sewer user charges levied on all the City’s utility customers. These revenues are used to fund the operating and maintenance costs of the utility, debt service requirements and capital improvement projects. Water revenues are generated from monthly user charges for the sale of potable water to customers connected to the City’s water distribution system. The fee schedule for water includes a monthly base charge, regardless of whether the service is turned on or off. In this FY 23/24 Adopted budget, the monthly base charge is adopted to increase from $30.23 to $35.37 as well as the step rates in all usage levels. Sewer charges are billed to customers connected to the City’s sewer system. The fee schedule for sewer includes a monthly base charge. This monthly base charge is adopted to increase from $22.12 to $23.67 as well as the step rates in all usage levels. Water consumption is used as the basis for sewer billings. Both the water and sewer rates are based on a tiered rate structure intended to encourage water conservation. In other words, the more water a customer uses, the higher the rate for the incremental amounts. Other water and sewer revenues include tap installation charges for water customers for the initial connection to the City’s water system, service charges collected from water customers for connection and disconnection from the City’s water distribution system, tampering fees, water, and sewer late payment penalty charges of 10% of the current unpaid balance and fire line rental and inspection fees.

The City has major infrastructure needs for its water, wastewater, and stormwater utilities due to the age of the infrastructure, deferred maintenance, and the impacts of climate change and ongoing development requiring additional service capacity. As such, staff has been tasked with developing and implementing a long-term plan that includes but is not limited to:

• Water, wastewater, and stormwater master plans to establish a long-term capital improvement plan of the entire system.

• Issuance of utility revenue bonds to fund capital projects over the next 10 years.

• Pursuing federal and state grant/loan opportunities to help offset the cost of servicing debt.

• Establishing an asset management program for the ongoing tracking, maintenance, and renewal/replacement of utility infrastructure.

• Incorporating a rate stabilization fund.

• Ensuring adequate funding of renewal & replacement reserves

During the September 12, 2022, City Commission Workshop, phase one of the FY 2023-2027 Utility Rate Study was presented by the outside consultant and the proposed rate increases for water and wastewater were discussed. The main objective of the first phase of the study was to establish rates that are sufficient to cover the cost of operating, maintaining, repairing, and financing system operations over the next five years in anticipation of the first series of utility revenue bonds. Changes discussed at the meeting were made to the rate study and a final report is being adopted concurrently at second reading with the adoption of the ordinance herein. The proposed changes resulted in increases of 40%, 5.25%, and 10% for water, wastewater, and stormwater, respectively, for fiscal years 2023. The recommended increases for fiscal years 2024- 2027 were also included in the adopted rate study.

On September 28, 2022, the City Commission adopted the City’s 5-year Capital Improvement Program (CIP Plan) and 5-year utility rate study which included plans for $230.6 million in capital projects ($181 million to be funded with public utility revenue bonds) through FY 2028-29 and rates required to service the future debt, respectively.

Consequently, the City's bond consultants advised reassessing the initial cost projections in the CIP Plan, in collaboration with the City's engineers. This revision was crucial before proceeding with the issuance of the first tranche of bonds, which were initially projected to be worth $53.2 million.

In March 2023, the City updated the CIP Plan to align with current market conditions. This adjustment led to an increase of $22.3 million in capital project costs within the CIP Plan through FY 2028-29.

These changes have been integrated into the amended bond feasibility study and the refreshed 5-year utility rate study slated for City Commission approval before issuing the first series of utility revenue bonds.

As a result of the CIP Plan revisions, the first tranche of utility revenue bonds is adopted to rise from $53.2 million to $63.9 million. This amount encompasses an increase of roughly $6 million for additional project funding and $4.7 million for the establishment of a reserve fund in compliance with the Master Utility System Bond Ordinance, as well as covering debt issuance.