Financial Capacity Definitions

Revenue Sufficiency

• Rates and fees cover the full cost of your water system's service.
• All costs and revenues are known and can be measured.
• Reserves or savings are available for unexpected expenses (i.e., a rainy day fund) and asset repair and replacement.

Credit Worthiness

• The water system has sufficient credit worthiness to allow it to access funds for an emergency or for implementation of a capital improvement plan.
• The water system can access capital through public or private sources.

Fiscal Management and Controls

• The water system keeps adequate books and records, uses appropriate budgeting, accounting, and financial planning methods, and manages revenues effectively.
• The water system monitors and minimizes potential risks to meeting financial obligations.

• Capacity Development
• Financial Capacity