Westminster budget workshop focuses on utilities bond, cash reserves and possible rate increases

City staff outlined a multi-year utilities capital plan and financing options Tuesday at the City of Westminster budget workshop, saying the city may seek up to $5 million in borrowing to pay for electric undergrounding and SCADA work, water-line replacements, wastewater manhole rehabs and other projects while also urging council to rebuild cash reserves reduced by hurricane response costs.

The presentation, led by a city staff member during the Feb. 11 workshop, said federal reimbursements tied to Hurricane Helene were not yet in hand and that FEMA-eligible costs now expected to be reimbursed total about $200,000, plus or minus $15,000. Excluding FEMA reimbursements, staff estimated the city’s combined utility days-cash-on-hand would fall to roughly 61 days; staff said the municipal goal is 90 to 120 days and calculated the city is about $2 million short of the upper end of that target.

Staff told council the city closed out a prior USDA loan late in 2024, which was a prerequisite to exploring additional combined-utility indebtedness. The staff member said bond counsel and the city’s financial adviser have been notified and that staff will prepare an RFP to seek loan or bond terms if council directs them to proceed. City staff estimated issuance-related legal, financial and bank fees for a $5 million financing at about $150,000 and described $5 million as a not-to-exceed maximum rather than a firm final project total.

Why it matters: staff…