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Shorewood Hills Water Utility Forecasted Revenue Requirement Report

Strategic Insights

— 1 min read

The Public Service Commission of Wisconsin has published a report on the forecasted revenue requirement of the Shorewood Hills Water Utility for the year ending December 31, 2025. The report presents the Utility's expected results of operations for the forecast period, based on the assumptions and judgments of management as of July 28, 2025. The forecast reflects the Utility's expected conditions and course of action, with significant assumptions disclosed.

Key Takeaways:

  • The Shorewood Hills Water Utility is a separate enterprise fund of the Village of Shorewood Hills, managed by the Village Board of Trustees and subject to regulation by the Public Service Commission of Wisconsin (PSCW) in matters of rates, financial reporting, and other procedures.
  • Water revenues are recorded for service rendered based on water meter readings, with billings made to customers monthly. The Utility does not record unbilled revenues.
  • Expenses are forecasted based on the operation and maintenance utility budget for 2025, with significant non-routine maintenance costs normalized for rate-making purposes.
  • The Utility is exempt from income taxes and does not record income tax liability. Property tax equivalent for 2025 is based on the 2024 mill rates and the 2024 assessment ratio.
  • Metered sales are forecasted based on actual customer and consumption data from April 2024 through March 2025, with anticipated four additional residential customers in 2025.
  • Public fire protection is forecasted based on 2025 meters and the current rates in effect, while private fire protection was forecasted based on actual connections for the twelve-month period ended March 2025.
  • Operating revenues, operating expenses, and plant financing are forecasted based on historical data, expected changes, and discussions with Utility management.

Statistics:

  • The Utility is forecasting metered sales of 432,246 units for 2025.
  • Breakdown of forecasted expenses:

+ Operation and maintenance expenses: 2025 (projected to be $5,934,405)

+ Depreciation: $1,430,000

+ Taxes: $1,276,581

  • Breakdown of forecasted operating revenues:

+ Water revenues: $7,352,564

+ Other water revenues: $540,525

  • The Utility anticipates four additional residential customers in 2025.
  • The Utility's enterprise funds for the year ending December 31, 2025, are forecasted to have a net income of $468,919.

Sources:

  • American Institute of Certified Public Accountants (AICPA) Statements on Standards for Accounting and Review Services
  • Public Service Commission of Wisconsin (PSCW) guidelines for the presentation of a forecast
  • Shorewood Hills Water Utility report on forecasted revenue requirement, dated July 28, 2025.

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