The City's Utility Municipal Advisor, PFM, conducted a Resiliency and Cash Balance study for the three public utilities to ensure they maintain a strong financial position and was viewed favorably by bond rating agencies. The Resiliency and Cash Balance study that was presented at the 4/11/2021 Council Study Session for WPC is attached.

The Public Utilities Advisory Board also reviewed the study and recommends the City Council should not follow the recommendations of the Municipal Advisor and staff but rather choose $10 million as the reserve amount.

A table comparing the two recommendations is provided below:

The policy establishes a targeted range for cash balances in the City's WPC utility. Each year, the City Manager will use this target to prepare and present the annual budget.

The proposed policy as recommended by staff will result in the WPC fund having approximately 300 days of cash available. The PUAB recommendation would have approximately 181 days of cash available. The average days of cash for comparable regional utilities are 674 days.