Sewer Financials Oversight: FY 2026–27 Budget & General Fund Advance

Post-H2O Innovations takeover run rate. Base validated from QB data; contingency needed for freeze/emergency hours.

Run-rate methodology with seasonal adjustment.

Above current run rate; USDA efficiency work noted.

Base ~$18K/yr recurring validated from QB data. One-time items (UV $12K, tanks $4K) identified. Contingency needed for equipment spikes (pump failure $8.7K, valve, generator, mixer).

Consumables worksheet itemizes $8,176. FY25-26 included one-time lab setup. No allowance for unplanned supply needs.

Run-rate methodology.

Proposed budget assumes routine-only pumping (4,000 gal × 26 pumpings × $194/kgal). QB data shows emergency-rate pumping in 9 of 10 months (Jun 2025-Mar 2026), volumes 5,000-16,000 gal at $290-$325/kgal. Annualized run rate ~$67K. Potential overrun ~$47K. EQ tank upgrade not complete until June 2027; plant operates with undersized infrastructure through entire FY26/27. Board needs clarification on whether emergency pumping pattern is expected to change.

$1,700/month run rate verified from QB data. ~$8K freeze spike (Jan-Feb 2026) excluded. Freeze events occur roughly every 2-3 years in Hudson Valley; contingency needed for weather events.

H2O Innovations contract; mid-year start explains variance vs FY25-26.

Per-test pricing × frequency.

Fixed bond payment. GF Advance repayment is separate issue tracked under account ES391 (balance sheet).

Single line serving five purposes: (1) $30K Borrowing Return for GF Advance repayment (should be separate budget line with defined schedule); (2) Capital Reserve (GML 6-c) for planned equipment replacement; (3) Repair Reserve (GML 6-d) for non-recurring unplanned repairs; (4) Contingency (VL 5-520, line 1990.4) for operating cost spikes (not in current budget); (5) Fund Balance for cash-flow timing. Originally labeled 'USDA Reserve – Short-Lived Assets Replacement' at $10K in January 2026 ongoing costs. Recommendation: separate into distinct budget lines.

Water-to-Sewer subsidy. Originally excluded from January ongoing costs estimate; added back March 22 as income with matching $30K Borrowing Return as expense. March 30 revision merged Borrowing Return into Reserve, leaving $30K as unoffset income. Board has not formally voted on whether this transfer should be permanent. Fund was originally designed to be self-supporting without this subsidy.

GML §9-a General Fund Advance for sewer bond payment. Total advance was $205,430; after applying $37,929 Reserve, net unfunded obligation is $167,501. Due May 31, 2026 (34 days from workshop date Apr 27). Repayment must occur within fiscal year per §9-a. Two instruments evaluated: Budget Note (external borrowing, 3-6 wk timeline, cost ~$84K/yr over 2 years, requires bond counsel and ⅔ vote) or GF Subsidy (budget amendment, immediate, cost to all village taxpayers). Treasurer's repayment plan expected May 11. Failure to repay may expose Trustees/officers to personal liability.