Brendhan O'Brien 
Member since Feb 7, 2017



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Re: “Barnhart says big tax cut will lead to more prosperous city

Pulled from recent City story update --

A story last week on the possibility of combining the city and county water systems drew a lot of attention and some scorn, particularly concerning how much the city's water system earns and what it's worth. Edward Doherty, retired vice president of the Rochester Area Community Foundation and former commissioner of the city's Department of Environmental Services, reached out with the following information:

"There are two numbers in the 2016-17 budget (p.7-60) that lay out the transfers from the water fund to the general fund (the water fund is the only city fund that generates sufficient income to cover all its capital and operating expenses, and transfer money to the general fund)."

"The first number is the "Contribution to the General Fund," which amounts of $5,373,600. This contribution is authorized in the city charter. Some call it a "profit," but the real idea is that it compensates the general fund as a payment in lieu of property taxes (a private utility would pay taxes). The second transfer is $2,452, 800 and is an administrative chargeback. This directly reimburses the general fund for central service expenses, such as legal, accounting, purchasing, communication, human services, etc. While the city could certainly reduce some of these costs if it no longer had the water system, that reduction would actually be quite minor (parts of lawyers, accounts, budget analysts, etc."

"So, the bottom line is that the city general fund would lose nearly $7.8 million in annual income if it sold the water system. If you take a 20-year perspective, the break-even sales price would need to be $156 million."

Not quite parochial or brain-dead...

0 likes, 1 dislike
Posted by Brendhan O'Brien on 02/18/2017 at 2:09 AM

Re: “Barnhart says big tax cut will lead to more prosperous city

Except the Rochester Water Works turns money back over to the city government every single year providing not only a world class product but a boost to the budget. Quite short-sighted to suggest selling it to the county for a one time boost that would be spent probably immediately on a Ferry. Sorry Mayor Johnson, not trying to take shots.

2 likes, 2 dislikes
Posted by Brendhan O'Brien on 02/07/2017 at 2:10 AM

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