Wellness Ridge
Community Development District
IRRIGATION WATER RATE STUDY DRAFT REPORT

SEPTEMBER 2025

200 South Orange Avenue, Suite 1550
Orlando, FL 32801
Phone: 407.872.2467 | Fax: 888.326.6864
www.willdan.com

September 8, 2025
Mr. George Flint, Wellness Ridge CDD District Manager Governmental Management Services - Central Florida, LLC 219 East Livingston Street
Orlando, Florida 32801
Subject:	Irrigation Rate Study (DRAFT)
Dear Mr. Flint,
WILLDAN FINANCIAL SERVICES is pleased to submit the Irrigation Rate Study (Study) to Wellness Ridge Community Development District (District) for your consideration. Willdan has completed the Study of the District’s Irrigation rates and charges as well as the development of five-year projected operating results. A summary of the analyses, assumptions, and conclusions are set forth in this Study.
We appreciate the opportunity to be of service to the District in this matter. In addition, we would like to thank you and the other members of the District staff for the valuable assistance and cooperation provided during the preparation of the Study. We look forward to collaborating with you on future projects and continuing a successful professional relationship.
Respectfully Yours,
Willdan Financial Services

Tara Hollis, CPA, CVA, MBA Principal Consultant

Table of Contents

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Table of Contents
Section 1 - Introduction	1
General	1
Goals and Objectives	1
Overview of the Rate Study Process	1
Computer Rate Model	2
Report Layout	2
Reliance on Data	3
Section 2 - Overview of Utility Rate-Making Principles, Processes, and Issues	4
Introduction	4
Discussion of General Rate-Making Principles	4
Revenue Sufficiency Process	4
Section 3 - Customer Statistics	6
General	6
Customer Billing Analysis	6
Metered/Billable Flow Projections	8
Section 4 - Fiscal Requirements	11
General	11
Projected Fiscal Requirements	11
Section 5 - Rate Structure Design and Adjustments	14
General	14
Cost Component Allocations	14
Rate Design	16
Test Year Rate Determinants	17
Annual Rate Adjustments	19
Section 6 - Projected Operating Results and Proposed Rates	20
General	20
Summary Revenues and Proforma Operating Results	20
Proposed Rates	20
Typical Bills	21

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Wellness Ridge Community Development District	September 2025
Section 7 - Miscellaneous Charges	22
Introduction	22
General	22
Preliminary Charges	23
Service Charges	23
Administrative Charges	25
Miscellaneous Charge Findings, Conclusions, and Recommendations	27
Section 8 - Findings, Conclusions, and Recommendations	28
General	28
Findings and Conclusions	28
Recommendations	29

Tables
Table 1. Projected Customers and Metered/Billable Flows	10
Table 2. Test Year Revenue Requirements: FY 2026	12
Table 3. Allocation of Revenue Requirements	15
Table 4. Retail Irrigation Proposed Block Allowances	17
Table 5. Test Year Rate Determinants	18
Table 6. Rate Design	19
Table 7. Projected Operating Results	20
Table 8. Projected Irrigation Rates	21
Table 9. Proposed Miscellaneous Service Charges	26
Figures
Figure 1. Existing and Projected Customers/Dwelling Units	8
Figure 2. Existing and Projected Metered/Billable Flows	9

Report

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 1 - Introduction
General
Wellness Ridge Community Development District (the “District”) retained Willdan Financial Services (“Willdan”) to prepare an irrigation rate study (the “Study”) to develop irrigation monthly user rates as well as miscellaneous charges for the irrigation system. As part of this Study, Willdan was to prepare a cost-of-service analysis of the irrigation system (the “Utility”) that is currently under construction in the District. Properties within the District currently receive irrigation water service from the City of Clermont. However, once the District’s irrigation system is complete, properties within the District will be provided with irrigation water service from the District. It is anticipated that the new District irrigation system will be in operation by November 1, 2025. This report details the results of the analyses for the forecast period, fiscal year (FY) 2026 through FY 2030 (the “Projection Period”), the results of which are presented in this Study Report.
Goals and Objectives
Prior to commencement of this Study, Willdan met with the District’s staff to discuss and identify the goals and objectives of the Study and to review a preliminary data request. The primary goals and objectives of the Study are to develop monthly rates for the District’s Irrigation System based on full cost recovery principals that result in: (i) water conservation in compliance with the District’s Consumptive Use Permit (CUP); (ii) just and equitable rates; (iii) operating revenues sufficient to meet the projected fiscal requirements of the irrigation system; and (iv) are administratively compatible and publicly understandable.
The Study, to the extent practical, utilizes a cost-of-service approach to establish user rates and charges based on the needs of the community and the Utility. The Study, pursuant to available data: (i) identifies the number of customers and associated service characteristics; (ii) delineates fiscal requirements by rate and functional activity; and (iii) identifies the appropriate levels of rates and charges based on the assumed Test Year ending September 30, 2026.
Overview of the Rate Study Process
The Study develops an irrigation financial plan for the upcoming 5-year planning period and includes the development of rates through a cost-of-service and rate design analysis. Utility rates must be set at a level such that operating, maintenance, debt and capital expenses are funded with the revenues received from customers. This is a significant point, as insufficient revenues can lead to unacceptable service levels and inadequately maintained facilities. Therefore, a rate study typically consists of the following interrelated components:
Financial Planning/Revenue Requirement Analysis: Creates a five-year plan to support an orderly, efficient program of on-going maintenance and operating costs, capital improvement

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 and replacement activities, debt financing, and retirement of outstanding debt. In addition, the plan should fund and maintain appropriate reserve balances based on industry standards, as well as the Utility Systems’ fiscal policies and specific needs.
Rate Design: Develops an equitable fixed/variable schedule of rates for the Utility System’s customer base. The balance of fixed and variable charges considers the need for a stable revenue source (the fixed charge) and the variable component of the rate structure such that customers placing higher costs on the system (through higher water use) incur a higher bill reflective of their capacity impact on the system.

Rate Design Analysis

Considers both the level and structure of the rate design to collect the appropriate revenues.

Revenue Requirement Analysis

Compares the revenues to the expenses of the utility to determine the overall rate adjustments required.

This Study utilizes generally accepted ratemaking principles and standards established by industry experts such as the American Water Works Association (AWWA) in its “M1 - Principles of Water Rates Fees and Charges”. The principles established by this entity is used as a guideline in the development of the proposed rates for irrigation.
Computer Rate Model
In addressing the Study needs, a Microsoft Excel-based comprehensive rate model was developed and utilized. The computer rate model has the capability to analyze and project the salient attributes and criteria associated with the review and development of comprehensive rates, including but not limited to customer statistics, operating and capital budgets, fiscal requirements, proforma statements, and utility fund balances. The computer model is a dynamic tool that was also used to identify the effects of various alternatives with respect to changes in fiscal requirements, customer growth, rate structure modifications, and rate adjustments on user rates and operating results.
Report Layout
This Rate Study presents an overview of the rate-making concepts employed in the development of the analysis contained herein. The analysis is followed by a discussion of the data, assumptions and results associated with each component of the analysis. Finally, appendices with detailed

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 exhibits are presented for further investigation into the data, assumptions and calculations which drive the results presented in this Rate Study. The report is organized as follows:
Section 1 – Introduction
Section 2 – Overview of Utility Rate-Making Principles, Processes, and Issues
Section 3 – Customer Statistics
Section 4 – Fiscal Requirements
Section 5 – Rate Structure Design and Adjustments
Section 6 – Projected Operating Results and Proposed Rates
Section 7 – Miscellaneous Charges
Section 8 – Findings, Conclusions, and Recommendations
Exhibits
Reliance on Data
During the course of this project, the District (and/or its representatives) provided Willdan with a variety of technical information, including current and projected cost data. We relied on this data in collaboration with the District on the formulation of our findings and subsequent recommendations, as well as in the preparation of this report. The results of our recommendations for optimum rate strategies are based on this information, however; there will be differences between actual and projected data, as they are based on the best available data and assumptions at the time of analysis.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 2 - Overview of Utility Rate-Making Principles, Processes, and Issues
Introduction
The Rate Study utilized generally accepted rate-making principles which resulted in the development of rates and charges which are projected to: 1) generate sufficient revenue to meet the financial requirements of the Utility and 2) meet the rate design goals of the Utility. A discussion of some of the key principles of rate-making, and how the processes employed herein are guided by those principles, is presented below.
Discussion of General Rate-Making Principles
While the individual rates for utility systems may vary based on a variety of factors, the development of rates should, for the most part, be consistent with general rate-making principles set forth in utility rate-making practice and literature. The principle by which rate practitioners are guided is that rates designed for any utility should strike a reasonable balance between several key principles. In general, rates designed should:
Generate a stable rate revenue stream which, when combined with other sources of funds, is sufficient to meet the financial requirements and goals of the Utility;
Be fair and equitable – that is, they should generate revenue from customer classes which is reasonably in proportion to the cost to provide service to each customer class;
Be easy to understand by customers; and
Be easy to administer by the Utility.
Striking the appropriate balance between the principles of rate-making is the result of a detailed process of evaluation of revenue requirements, and how those revenue requirements translate into the rate design alternatives which most closely meet the specific objectives of the individual utility under the circumstances in which the utility operates.
Revenue Sufficiency Process
In order to develop rates and charges which generate sufficient revenue to meet the fiscal requirements of the utility, a determination of the annual rate-revenue required must be completed. This rate-revenue, combined with other sources of funds, is evaluated to determine whether the total revenue is sufficient to meet those fiscal requirements. This process is typically referred to as a Revenue Sufficiency Analysis.
The process employed in the Revenue Sufficiency Analysis results in the identification of revenue requirements of the system, such as operating expenses, capital expenses (minor and major), debt service expense (including a provision for debt service coverage), transfers out and the maintenance of both restricted and unrestricted reserves at appropriate levels. These revenue

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 requirements are then compared to the total sources of funds during each year of the Projection Period to determine the adequacy of projected revenues to recover projected revenue requirements. To the extent that the existing revenue stream is not sufficient to meet the annual revenue requirements of the system, a series of rate revenue increases are calculated which would be required in order to provide sufficient revenue to meet those expenditure needs.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 3 - Customer Statistics
General
The purpose of this Study is to establish an equitable and financially sustainable rate structure for the District’s irrigation services. The analysis is designed to ensure that user charges recover the full cost of providing service, meet projected revenue requirements, and allocate costs fairly among customer classifications in accordance with industry standards and applicable statutory provisions. The methodology relies on documented historical usage, projected demand patterns, and the District’s planned service area buildout.
This Study is founded on a comprehensive evaluation of the District’s current and anticipated customer base, along with associated usage characteristics. Based on the approved development plan, the District will provide irrigation services primarily to Single-Family Residential Dwellings (SFD) and Townhome (TH) properties. The SFD classification comprises five standard lot sizes, defined by front footage, while the TH classification comprises two standard lot sizes. Irrigation service will also be extended to the Homeowners’ Association (HOA) and common areas.
Metered usage data for existing customers was obtained from the City of Clermont. Upon commissioning of the District’s irrigation system, these customers will be transferred to the District’s service area. Historical metered and billable flows for this customer base serve as the primary determinants in developing monthly user rates and charges, and they establish the foundation for forecasting future irrigation system revenues.
The customer and flow analysis presented herein is limited to classifications directly impacted by the proposed rates, namely, general service (retail) irrigation customers currently subject to charges for such service. For the purposes of this Study, these customers and their associated demand volumes represent the revenue-generating base upon which the proposed rate structure is applied.
Customer Billing Analysis
For the purposes of this study, irrigation usage records were compiled for each existing customer meter for the period from May 2024 through May 2025. The billing data was analyzed to assess the composition of the existing customer base and to identify representative usage patterns across classifications.
In addition to the historical consumption review, District staff and the Utility Engineer prepared projections of average irrigation demand based on the typical irrigable square footage associated with each parcel type and lot size. These projections reflect the District’s development plan and CUP allowances and were refined through discussions with District staff and the Utility System Engineering team to ensure accuracy and applicability to planned service conditions. These

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 projections are based on the District’s CUP allowances being approved at a minimum of 93,492,764 gallons per year and are exclusive of any customer swap agreements.
Based on these inputs, the irrigation system is expected to provide service to the following identifiable customer classifications:
Single-Family Residential
SFD 60
SFD 50
SFD 41 FL
SFD 40 RL
SFD 32 RL
Townhomes
TH 25 RL
TH 22
Non-Residential HOA/Common Areas
Each customer classification exhibits consistent physical and usage characteristics that form the basis for an equitable allocation of system costs. Under the current system configuration, SFD parcels are projected to be individually metered, while TH parcels will be master-metered with an assigned number of dwelling units per master meter for billing purposes.
Customer Accounts and Dwelling Units
For the District’s irrigation system, a customer account represents a connection to the system, irrespective of meter size. For each account, the number of dwelling units receiving irrigation service through that connection is also identified.
Historical customer data was analyzed to establish growth trends for each customer classification. These trends were then applied to project the average number of accounts and dwelling units by customer type for the Test Year and for each subsequent year of the Projection Period. The existing and projected average customer accounts are summarized in Figure 1.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Figure 1. Existing and Projected Customers/Dwelling Units
The District has experienced positive customer growth. For the projection period, the District anticipates an average of approximately 45 new home connections per month, continuing through buildout, which is projected to occur in FY 2028. Based on current economic indicators in the southeastern real estate market, recent development activity within the District, and discussions with District staff regarding anticipated construction schedules, the projected rate of growth is consistent with recent historical trends observed in the District’s customer data and is considered a reasonable basis for long-term financial and operational planning.
These assumptions are embedded in the rate study’s financial projections and are reflected in
the customer counts illustrated in the preceding graph.
Metered/Billable Flow Projections
The customer and billing data, combined with calculated irrigable areas by parcel type, formed the basis for determining total metered flow and allocating that flow among the various customer classifications and lot types. This analysis was used to estimate the average flow per customer or lot rounded to the nearest 100 gallons.
Historical trends indicate that these statistical relationships should remain relatively stable from year to year. Accordingly, the results of this analysis are considered reliable indicators for projecting future customer usage. The projected revenue-generating irrigation flows are presented in Figure 2. Note, for purposes of this analysis and rate design, it is assumed that all flows will be in Block 1, with Block 1 limits being set at the level of the proposed CUP allowances.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Figure 2. Existing and Projected Metered/Billable Flows
Summary of Customer Analysis
Historical billing data and information from the Utility Engineer was analyzed to identify growth trends and to forecast future system customers. Forecasting both the number of customer accounts/dwelling units and the associated metered/billable flows is essential, as these are the primary components used to estimate annual revenues for each year of the projection period.
The projected customer accounts and corresponding billable flows are detailed in Table 1. These projections serve as a key input to the revenue calculations and financial forecasts presented in the subsequent sections of this report.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

	Projected for Fiscal Year	
	2025	2026	2027	2028	2029	2030	
AVERAGE CUSTOMERS/DWELLING UNITS	
SFD 60	53	72	100	108	108	108	
SFD 50	336	472	646	684	684	684	
SFD 41 FL	84	129	198	221	221	221	
SFD 40 RL	108	133	163	169	169	169	
SFD 32 RL	149	163	203	228	228	228	
TH 25 RL	98	98	98	98	98	98	
TH 22	141	161	262	343	343	343	
Common Areas	1	1	1	1	1	1	
Total Average Customers (Dwelling Units)	970	1,229	1,671	1,852	1,852	1,852	
BILLABLE FLOW (1,000 Gallons)	
Block 1 (1)	64,624.80	67,826.00	88,468.80	93,496.80	93,496.80	93,496.80	
Block 2 (1)	-	-	-	-	-	-	
Total	64,624.80	67,826.00	88,468.80	93,496.80	93,496.80	93,496.80	

Table 1. Projected Customers and Metered/Billable Flows
Description

Note: (1) See Section 5 of the report for block allowances per customer/lot type. Based on 11 months of operations in FY 2026.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 4 - Fiscal Requirements
General
Fiscal requirements can generally be separated into three primary categories consisting of: (i) operating and maintenance expenses (O&M); (ii) debt service; and (iii) other needs and transfers. O&M expenses consist of those reoccurring expenses associated with labor, materials, supplies, services, etc. that are required to manage and operate the system while maintaining a dependable and desirable level of service. O&M expenses consisting primarily of labor, materials, supplies, utilities, and contract services are directly related to the level of service provided to customers and therefore, are appropriately recovered through the user rates and charges. Debt service is the principal and interest on bonds, loans, or other debt instruments and pledged security of the debt instruments and is allocated to the net rate requirement together with other sources of payments based on the pledged security of the debt instrument. Other needs and transfers, also referred to as below-the-line-items, include expenses and costs not associated with O&M expenses or debt service and can include such items as capital needs from rates, transfers in lieu of taxes, Renewal and Replacement requirements and/or other funding per covenants in resolutions adopted pursuant to outstanding bond issues.
The fiscal requirements of the utility system to be recovered through the monthly irrigation rates consist of the net amount of O&M expenses and other requirements after deduction of other budgeted non-user rate revenue sources. The net fiscal requirements, which are the fiscal requirements less non-user rate revenue sources such as interest income, transfers from other accounts, and miscellaneous charges, associated with the Test Year were identified using a budget developed by District staff for Fiscal Year 2026. For purposes of this Study, the Test Year is assumed to be FY 2026 with rates proposed for FY 2026 through FY 2030 (the “Projection Period”).
The Test Year net fiscal requirements were developed with consideration of: (1) findings on existing and projected customers and development; (2) analysis of past and current O&M expenses for similarly sized systems, (3) necessary transfers; and (4) conversations with District staff.
The development of the net revenue requirements associated with the Budget, as adjusted, is summarized in Exhibit 1 at the end of this Report.
Projected Fiscal Requirements
The projected Test Year revenue requirements, as well as the requirements for the remaining years of the Projection Period are estimated by utilizing the adjusted Budget as a basis and making annual escalation adjustments for each line-item in accordance with historical cost

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 escalation trends, as well as assumed future activities and events that may impact the utility system. Such projections include increasing applicable O&M expenses by inflationary and/or customer growth factors depending upon the nature of the expense, utilizing actual debt service requirements as provided in the applicable debt service schedules if any, using capital outlay estimates as provided by the District, and tying non-operating transfers to revenues or O&M expenses as applicable.
Projections of the net fiscal rate requirements for fiscal years 2027 through 2030 reflect the anticipated impacts of inflation and increases in labor and supply costs. To address these items subject to changes, escalation factors were developed and applied for each adjusted budget line item as shown on Exhibit 1. This process results in fiscal requirements that reasonably reflect probable future expenditures. The Test Year revenue requirements that are used for developing the user rates proposed herein are provided in Table 2.
Table 2. Test Year Revenue Requirements: FY 2026
Description	Amount	
Expenses		
Operating and Maintenance Costs	$	231,734	
Transfer to Capital Reserves	20,000	
Gross Revenue Requirement	$	251,734	
Less: Other Revenues	-	
Net Revenue Requirement	$	251,734	
Add: Contingency Adjustments	$	25,173	
Adjusted Net Revenue Requirement	$	276,907	
In the preparation of this Study, certain assumptions were made with respect to conditions which may occur in the future. While it is believed that the assumptions are reasonable for the purpose of this Study, they are dependent upon future events and actual conditions may differ from those assumed. In addition to the projections, estimates, and studies, certain information and assumptions provided or prepared by others have been used and relied upon. While believed to be reasonable for the purpose of this Study, no further assurances with respect thereto are offered, other than for the purpose of this Report. To the extent that actual conditions differ from those assumed herein or from information or assumptions provided or prepared by others, the actual results will vary from those estimated and projected herein. Such projections are, therefore, subject to adjustment and there are no assurances that the projections will be realized.
The principal considerations and assumptions used in projecting the operating results include the following:

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

1. Projected Fiscal Requirements for the 5-year projection period are based on proposed FY 2026 budget developed by District staff with adjustments as appropriate based on historic trends and discussions with District Staff. These requirements include escalation factors for customer growth, inflation, labor, supply costs, etc. These escalation factors were applied at a detailed level to obtain the net fiscal requirements and proforma presented at the end of this Study. In general:
The Rate Revenue/Customer Growth Factor has been applied to revenues for the projection period.
The Labor Escalator, which is higher than general inflation due to a combination of anticipated benefit and merit adjustments, has been applied to employee costs for the projection period.
Certain O&M costs, such as chemical, gas/oil, etc., anticipated to grow according to customer growth and inflation, were escalated using the Customer Growth/Inflation Factor.
Other O&M costs, such as professional services and auditing, were escalated using the General Inflation escalator.
Supplies and the repair and maintenance portion of O&M costs were escalated by the Supplies/Repairs & Maintenance escalator.
Reserves, or working capital, are funds set aside for cash flow requirements, financial needs, capital project funding, or to comply with legal/debt service covenants. Maintaining adequate reserves is an important consideration in developing a long-term financial management plan for utility/enterprise funds. These reserves act as a margin or buffer in order to meet short- term cash flow requirements of the fund/utility while minimizing the risk associated with financial obligations, operational costs, and capital requirements in the event that near-term events differ from the budgeted expectations. For the purposes of these projections, the Utility System is targeting to maintain a minimum reserve fund of 90-days cash on hand to cover operating expenses.
Additionally, the District is targeting a capital reserve fund balance of $650,000 at the end of the first 10 years of operation of the irrigation system. In order to minimize initial rates at the start-up of the irrigation system, the projections include phasing-in transfers to the capital reserve fund in the first few years of operation to allow for additional customer connections to come online. The projections include an initial transfer in FY 2026 of $20,000 increasing to
$80,000 per year by FY 2030.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 5 - Rate Structure Design and Adjustments
General
Rate structure design represents that portion of the Study whereby the rate and charge components for each customer class are established to provide for equitable recovery of the net fiscal requirements consistent with the previously discussed criteria together with the regulatory guidelines/policies of the District and the State of Florida.
Cost of service principles suggest that the fixed costs associated with the net fiscal requirements be recovered through the fixed rate component (Base Charge), whereas variable costs be recovered through the Usage Rates. However, with fixed costs far exceeding 50 percent of the total costs and community standards suggesting that the costs for basic services be maintained at minimum levels, it is not always practical to set the Base Charge on the relation of fixed and variable costs. Prudent practice suggests that certain levels of the fixed costs can be equitably recovered through the variable component (Usage Rates).
Additionally, local government policies suggest that the rate structure components to the extent possible and practical should be:
Administratively simple, understandable, and easily implemented;
Equitable among customer classes, taking into consideration the cost of service for each individual customer class;
Designed to encourage the most efficient use of the District’s assets and other resources
and discourage unnecessary or wasteful use of service and commodity;

In compliance with applicable requirements of local, state, and federal regulatory authorities that have jurisdiction; and
In compliance with all applicable statutory requirements.
Several other considerations that have an effect on the designs of the rate structure components are: (i) revenue stability; (ii) revenue sufficiency; (iii) satisfaction of applicable debt covenants, if any; (iv) historical rate structures; and (v) the policies of those responsible for the management and operation of the District and its capital facilities.
Cost Component Allocations
In order to design rates to recover expenses on a cost basis, it is necessary to further allocate system costs to the various rate structure components proposed herein. The irrigation utility costs are commonly classified into two categories for generally accepted ratemaking purposes.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 These cost categories include 1) availability costs (i.e., fixed or capacity-related costs); and 2) variable or flow-related costs. A general basis for the assignment of the net revenue requirements is as follows:
Availability Costs (Monthly Base Charge) - The costs incurred to establish a state of readiness to serve and maintain an irrigation system capable of meeting the total combined capacity demands of the customers. Such costs are generally fixed in nature and typically include portions of the operating expenses (especially labor costs), certain capital expenditures, and other costs that do not vary materially with the quantity of flow or cannot be designated specifically as variable costs. These costs may also be related to contractual obligations such as debt service payments that must be fulfilled whether or not the system operates.
Variable Costs (Usage Rates) - Those costs that vary substantially or directly with the amount of service provided. Common variable costs include flow or service-related items such as chemicals, electricity, maintenance, and certain other portions of the budgeted operating expenses.
The rate category criteria described above are generally applied to the individual cost items in the budgeted revenue requirements in order to allocate the costs to each rate component. These allocations are then utilized as a basis to further develop the user rates and charges.
It should be noted that strict allocations pursuant to the cost criteria or rate components can often result in an unreasonably high monthly base charge since many of the utility costs are inherently fixed in nature. Therefore, in designing the utility rates, certain considerations are made with regard to ratemaking allocations in order to more uniformly provide reasonable and acceptable levels for each rate component.
While providing for such considerations may result in rate components that vary from the strict cost of service application, the objectives of cost recovery and equity are maintained. The other ratemaking considerations are detailed in the rate calculation sections later in the Report.
The allocation of the net revenue requirements to the rate/cost components is summarized in
Table 3.
Table 3. Allocation of Revenue Requirements
Rate/Cost Component	Amount	
Availability Component (Monthly Base Charge)	$	110,763	
Volume Component (Usage Charge)	166,144	
Total Fiscal Requirements	$	276,907	

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Summary of Customer Analysis
As previously described, the historical billing data was utilized to estimate growth trends that are used to project the system customers in the future. A projection of future customers and metered flows is necessary since these are the primary components utilized in estimating the revenues each year of the Projection Period. The projected customer accounts and billable flows, after taking into account the rate structure modifications described in this section, were provided previously in Table 2.
Rate Design
General
Historical billing data and data provided by the Utility Engineer was analyzed to identify growth trends and to forecast future system customers. Forecasting both the number of customer accounts/dwelling units and the associated metered/billable flows is essential, as these are the primary components used to estimate annual revenues for each year of the projection period.
This section includes the development of cost-of-service rates to go into effect once the District irrigation system is in operation, which is assumed to be on or before November 1, 2025.
The proposed irrigation rates are comprised of two rate components consisting of a monthly service availability charge and volumetric rates. The proposed monthly service availability charge is based on the customer type and the volumetric rates are charged per 1,000 gallons of metered usage. As previously addressed, this type of rate structure meets the District’s objectives and provides a reasonable allocation of the cost among the various customer classes pursuant to the demand and usage characteristics determined for each customer type and lot size.
The methodology used to calculate the rates proposed herein involves identifying the test year rate determinants and then allocating the net fiscal requirements based on the appropriate rate determinant.
Rate Components
The base charge for irrigation service will be established as a flat rate per dwelling unit for Single- Family Residential Dwelling (SFD) customers. For Townhome (TH) customers, the base charge will be assessed as a fraction of a dwelling unit (0.25 per dwelling unit), reflecting typical multi-family billing practices where individual units have lower irrigation demand compared to single-family lots. This approach ensures that charges are proportionate to the anticipated usage for each customer type while maintaining consistency and equity across the system.
In addition to the base charge, customers will incur charges based on actual irrigation water usage, measured through metered flows. The combination of the flat base rate and the volumetric usage charge ensures that each customer contributes fairly to the fixed costs of

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 maintaining the system while also paying proportionally for the water they use. This rate structure promotes equity among customer classes and provides an incentive for efficient water use, particularly for customers with larger irrigable areas or higher consumption.
To encourage responsible irrigation practices, maintain equity among customers, and comply with the irrigation usage allowances in the District’s CUP, irrigation block allowances are recommended based on lot size. Each property will receive a set volume of water specifically for irrigation, scaled to the size of the lot. Larger lots require more water to maintain landscaping, while smaller lots require less. Allocating irrigation water proportionally encourages efficient outdoor water use, accommodates different property types, and helps align overall demand with conservation goals and regulatory limits. Additional measures may be required if customers exceed the CUP limitations.
The proposed block allowances are presented in Table 4, with all usage rounded to the nearest 100-gallon increment. As Townhomes will be provided service through master-metered connections with the bill being allocated to all dwelling units on the master-meter, the usage allowances for TH parcels will be the standard for all TH dwelling units regardless of lot size. The proposed usage block allowances have been developed based on information provided by the Utility Engineer.
Table 4. Retail Irrigation Proposed Block Allowances
Customer Type / Lot Size	Block 1	Block 2	
Single-Family Residential (SFR) per Dwelling Unit	
SFD 60	0 - 4,300	Above 4,300	
SFD 50	0 - 3,300	Above 3,300	
SFD 41 FL	0 - 2,700	Above 2,700	
SFD 40 RL	0 - 2,600	Above 2,600	
SFD 32 RL	0 - 2,400	Above 2,400	
Townhomes (TH) per Dwelling Unit	
TH 25 RL	0 - 1,500	Above 1,500	
TH 22	0 - 1,500	Above 1,500	
Non-Residential	
Common Areas	All Flow	N/A	
Note: (1) Master-Metered connection Block Allowance are multiplied by number of dwelling units per master-metered connection.	
Test Year Rate Determinants
The level of rates and charges for each component of the irrigation rate structure requires identification of determinants associated with each rate structure component and customer class/lot size. This was accomplished by utilizing customer characteristics and the rate structure usage allowances discussed previously. The determinants developed for this Study, and discussed below, are based on consideration of: (i) the number of accounts; (ii) the inclining block

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 criteria; (iii) elasticity of demand/reliability considerations; and (iv) billable flows identified for the Test Year. For this analysis, the Test Year is assumed to be FY 2026.
Customer Base Charge Determinants – Determinants for the Customer Base Charge consist of the average number of accounts and dwelling units for the Test Year. The accumulation of the accounts shown in Table 5 below as adjusted for customer growth.
Volumetric Rate Determinants – The rate determinants utilized in the development of the volumetric rates, pursuant to the methodology previously discussed, consists of the amount of billable irrigation flow as adjusted to account for: (i) the inclining block rates (the rate determinant factor) and (ii) anticipated elasticity resulting from the rate structure modifications and rate adjustments (the reliability factor). More specifically, the incremental factors represent the degree of increase applied to the initial block (Block 1) resulting in the monetary amount associated with each successive block. The reliability factor provides for certain uncertainties with regard to actual events given the anticipated reaction of customers to rate structure modifications and adjustments, along with unknown future weather conditions.
The inclining block determinant and block criteria discussed above, along with the flows identified in the billing the customer analysis, were used in the development of the billable flow determinants shown in Table 5 as detailed in Exhibit 2. Note: the Volumetric Flow Determinants have been adjusted based on a November 1, 2025 start date to reflect 11 months of usage for the Test Year. They have also been adjusted to account for a reliability factor to be used for rate design purposes.
Table 5. Test Year Rate Determinants
Description	Determinants	
Customer Charge Determinants	
Single-Family Residential	969	
Townhomes	65	
Non-Residential (HOA/Common Areas)	1	
Total Customer Charge Determinants	1,034.75	
Volumetric Rate Determinants (1,000 gallons)	
Block 1	65,112.96	
Block 2	-	
Total Volumetric Rate Determinants	65,112.96	
The rate design and resulting rate recommendations are summarized in Table 6 as detailed in
Exhibit 3 at the end of this Report.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Table 6. Rate Design
Description	Base	Usage	
Total Fiscal Requirements	$	110,763	$	166,144	
			
Total Determinants	1,034.75	65,112.96	
			
Rate Per Determinant	$	9.74	$	2.56	
Annual Rate Adjustments
In order to avoid negative cash flow and keep pace with inflation, as well as growing costs on items such as fuel, chemicals, labor, etc., it is recommended that the District implement an annual indexing of its rates and charges. Willdan has included annual rate adjustments for inflation in the amount of 3.5% per year throughout the Projection Period beginning in Fiscal Year 2027 after implementing the initial rates and charges in Fiscal Year 2026.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 6 - Projected Operating Results and Proposed Rates
General
Willdan has developed an interactive computer model for the District that incorporates the Test Year and Proforma fiscal requirements of the utility, fund balance operating policies, and customer accounts and usage characteristics. This model was used to develop the proposed rates discussed herein.
Summary Revenues and Proforma Operating Results
As discussed in the previous section, irrigation rates have been developed for the District. The results discussed in Section 6 assume that the District will begin charging irrigation rates effective November 1, 2025. The results of implementing the initial rates and charges, as well as the annual adjustments of 3.5% per year thereafter, are shown on Table 7 below as detailed in Exhibit 4. The results demonstrate that the proposed rates and charges along with the other system revenues and estimated future rate adjustments are anticipated to be sufficient to satisfy the projected revenue requirements and capital needs of the irrigation utility system.

	For the Fiscal Year Ended September 30,	
	2026	2027	2028	2029	2030	
Annual Rate Adjustments	N/A	3.50%	3.50%	3.50%	3.50%	
						
Operating Revenues						
Charges for Services	$	284,512	$	403,907	$	446,591	$	462,686	$	478,997	
Other Revenues	-	1,050	2,020	3,070	4,300	
Total Operating Revenues	284,512	404,957	448,611	465,756	483,297	
						
Operating Expenses						
Operating and Maintenance Costs	231,734	317,248	354,012	366,755	379,957	
Transfer to Capital Reserves	20,000	25,000	50,000	75,000	80,000	
Total Operating Expenses	251,734	342,248	404,012	441,755	459,957	
						
Net Income (Loss)	32,778	62,709	44,599	24,001	23,340	
						
Fund Balance						
Unrestricted	$	32,778	$	95,487	$	140,086	$	164,087	$	187,427	
Capital Reserve	20,000	45,000	95,000	170,000	250,000	
Total Fund Balances	$	52,778	$	140,487	$	235,086	$	334,087	$	437,427	
						
Days Cash on Hand	52	110	144	163	180	

Table 7. Projected Operating Results
Description

Proposed Rates
Based on the proposed rate structure and rate adjustments discussed in the previous section of this Report, the recommended rate structure and rates for FY 2026 through FY 2030 are shown in Table 8.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Table 8. Projected Irrigation Rates
Description	FY 2026	FY 2027	FY 2028	FY 2029	FY 2030	
Base Charge (per customer/dwelling unit)	
SFD 60	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
SFD 50	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
SFD 41 FL	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
SFD 40 RL	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
SFD 32 RL	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
TH 25 RL	$	2.44	$	2.52	$	2.61	$	2.70	$	2.80	
TH 22	$	2.44	$	2.52	$	2.61	$	2.70	$	2.80	
Common Areas	$	9.74	$	10.08	$	10.43	$	10.80	$	11.18	
Usage Charge Per 1,000 Gallons (Per Customer Dwelling Unit/Lot Size):	
Block 1	$	2.56	$	2.65	$	2.74	$	2.84	$	2.94	
Block 2	$	6.40	$	6.63	$	6.85	$	7.10	$	7.35	
Typical Bills
To illustrate the application of the proposed rates and charges, typical monthly irrigation bills have been calculated for representative customer types as shown in Exhibit 5. These examples incorporate both the fixed base charge determined per dwelling unit or fractional dwelling unit, depending on the customer classification and the volumetric usage charge based on metered consumption within the applicable block allowance. For each example, usage will be assumed at varying levels (i.e., below, at, and above the assigned block allowance) to demonstrate the impact of consumption patterns on total charges. By presenting these scenarios for different lot sizes and customer classes, the District can clearly show how the rate structure functions, the cost implications of higher usage, and the financial incentives for customers to maintain irrigation within the allocated allowances. Additionally, the fees that would be charged by the City of Clermont are also included for comparison purposes. It is our understanding that the City of Clermont plans to increase its current irrigation rates by 3.0% effective October 1, 2025. The Clermont typical bills shown in Exhibit 5 include the 3.0% increase to the rates.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 7 - Miscellaneous Charges
Introduction
A utility system provides a wide range of operating services that are generally categorized as either benefiting users’ system wide, or individually. System wide services include the operations, customer services, maintenance, repairs and refurbishment of facilities that are directly related to water delivery, including associated administration and billing, whereas, individual services consist of those activities directly benefiting an individual customer, such as application for services, meter installation, turn-offs, turn-ons, private fire protection, etc. This Report will focus on those services and costs associated with individual services, which are referred to as Miscellaneous Charges. It should be noted that impact fees for material utility expansion, capital improvements, or contributions, such as transmission line extensions, and similar items should not be confused with the miscellaneous cost recovery charges which are the subject of this Study.
Miscellaneous Charges can be further categorized as being associated with connection services, customer services, or certain extraordinary utility services (cost recovery mechanisms). Connection services, as the name implies, are associated with activities directly related to the interconnection of the customer’s facilities to the Utility’s facilities. Customer services relate to services requiring District personnel to review activities or make site visits for the purpose of identifying or resolving requests by customers. Extraordinary utility services consist of selected one time, temporary or special services that involve commodity or capacity related services of the Utility.
The primary purpose for these subcategories is for proper cost identification and allocation. Generally, a utility does not maintain separate cost records for each individual event as such activity would not be prudent or cost effective. For the purpose of costing standard activities for each event, costs are identified and accumulated based on allocation of average labor, equipment, and materials.
General
A variety of miscellaneous charges in the water utility industry include collection and delinquency charges, service turn-off and turn-on charges, various service application fees, line tapping charges, meter set charges, and jobbing and merchandise sales. When special charges are used, the District should coordinate these rates and charges with its customer service personnel. Procedures must be developed to ensure that the customer has advance warning about requests that will trigger a charge. Billing procedures must be in place to properly account for special charges. Customer service personnel must have all the necessary information available, so they can explain the intent and circumstances to which each charge applies.  Information

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 preparedness will minimize the perception that these charges are punitive and will enhance the District’s effort to promote customer support.
Preliminary Charges
Preliminary Charges
For the purpose of this Report, a Preliminary Charge is defined as a charge to account for costs incurred at the time of an initial connection. Such a charge would enable the District to assess individual customers at the time of connection.
Preliminary Charge Recommendations Application Fee
An application fee is a one-time charge that customers pay when applying for a new service connection or account. This fee typically covers administrative costs associated with processing the application, verifying customer information, setting up the account, and sometimes conducting an initial site inspection. Willdan recommends the charge for this service is $50.00 for developers and $25.00 for a customer.
Meter Installation/Initial Connection Charge
A Meter Installation/Initial Connection Charge is defined as a charge assessed to customers for installation and service initiation at a location where service did not exist previously. Willdan recommends that the charge for a 3/4" meter be $650.00, a 1” meter be $850.00 and meters above 1” would be charged at the actual cost.
Service Charges
Service Charges
For the purpose of this Report, a Service Charge is defined as a charge that the District assesses the customer for different types of service-related testing or interruptions in service that require some kind of action from the District.
Service Charge Recommendations
Connection/Disconnection of Service
The Connection of Service Charge is defined as a charge levied for transfer of service to a new customer account at a previously served location, or reconnection of service subsequent to a customer requested disconnection. The Disconnection of Service is defined as a charge levied for a customer-requested disconnection of service. Willdan recommends that the District charge
$135.00 per occurrence.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

After Hours Connection/Reconnection of Service
An After-Hours Connection of Service charge is defined as a premium above the normal Connection of Service charge for the transfer of service to a new customer account at a previously served location, or reconnection of a service subsequent to a customer requested disconnection that occurs between 3:30 p.m. through 10:00 p.m. After 10:00 PM the service will be restored the following day. Willdan recommends that the District charge $295.00 per occurrence.
Meter Re-Read / Leak Inspection Fee
Irrigation bill complaints that are not resolved by telephone may necessitate that a meter be reread or that the customer’s service line be inspected for leaks. If the matter is not resolved to the customer’s satisfaction, the meter may be removed and tested at the request of a customer. A fee is typically implemented to assess the customer for charges incurred when sending staff to a site at the request of a customer to reread the meter or perform a leak inspection, and no problem can be found. A fee may be charged when a customer requests a special meter reading or asks that a meter be reread though, in the opinion of the District, no reading is warranted. This charge not only enables the District to recover the cost of service but also prevents customers from abusing the opportunity to dispute meter readings. Willdan recommends the District charge a fee of $140.00.
Meter Accuracy Test Fee (Meter Bench Test)
A meter accuracy test occurs when a customer calls and requests that their water meter be tested for registering inaccurately as identified in the District’s current Uniform Service Policy. The charge is designed to recover administrative and labor costs associated with the service call, while also covering the costs associated with meter replacement and testing services. In this situation, the meter must be removed, and a new meter must be installed while the old meter is taken in for testing. Industry standards and benchmarking show that results in this area are rarely in favor of the customer requesting the test; therefore, Willdan recommends that in situations where the customer is requesting an accuracy test for their meter, that the customer is assessed
$380.00 plus the actual cost for the testing facility, mileage to and from the testing facility, and materials and that payment be made before the services are rendered. If the results of the accuracy test determine that the meter is damaged or gives inaccurate readings, the customer would be reimbursed for these services.
Missing or Damaged Equipment Fees
Missing or Damaged Equipment Fees refer to charges imposed on customers when utility-owned equipment, such as water meters, meter lids, backflow preventers, or other infrastructure, is lost, tampered with, or damaged. These fees help cover the cost of replacing or repairing the equipment to ensure continued service and system integrity. Willdan proposes the District

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 charges $20.00 for a padlock, and $20.00 for a locking device. Meters are charged at cost, $30.00 for a meter box lid replacement, $155.00 for a full meter box replacement and $500.00 for a hydrant meter replacement.
Administrative Charges
Administrative Charges
For the purpose of this Report, an Administrative Charge is defined as a charge that the District assesses the customer for different types of services related to account transactions that require additional administrative efforts or in some cases cost the District additional money.
Administrative Charge Recommendations
Late Payment Fee
The Late Payment Charge is a charge assessed to customers for delinquent bill payments. This charge is used as an incentive for prompt payment and recognizes the time value of money and other added costs. Willdan recommends the District charge a minimum of $15.00 or 1.5% of the late balance, whichever is greater.
Returned Check Charge
The Returned Check Charge is controlled by Florida Statutes 832.07 and 832.08, which describe this charge as a fixed fee dependent upon the face amount of the check. This fee occurs when a check is not honored by the customer’s bank regardless of the reason. This charge reflects the added cost to the District for processing a returned check. Willdan proposes the charge for a check returned with a face value of $50.00 or less be $25.00. For checks greater than $50.00 but less than $300.00 the charge is $30.00. For checks exceeding $300.00 the charge is the greater amount of $40.00 or 5% of the face value of the check.
Illegal Water Use
Illegal water use charges are charges levied to individuals found to be using water illegally and are intended as a punitive fee. This charge is a base charge that does not include fees assessed to the customer for actual water consumption. Willdan proposes the District charge $980.00 for a first offense of illegal water use, and a $2,000.00 fee for repeat offenders. After the fine is assessed, users will also be charged for the consumption that occurred illegally on the regular rate and charge basis.
Recommendations
Charge recommendations for Preliminary Charges, Service Charges, and Administrative Charges can be found in Table 9.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Proposed Charge

Description

Table 9. Proposed Miscellaneous Service Charges

PRELIMINARY CHARGES

Application Fee
Developer/Builder	$		50.00	
Customer	$		25.00	
Meter Installation/Service Initiation Charge				
Residential Irrigation Service 3/4" Meter	$		650.00	
Residential Irrigation Service 1" Meter	$		850.00	
Commercial and all other sizes		At Cost		

SERVICE CHARGES				
Connection/Disconnection of Service	$	135.00	
After Hours Connection/Reconnection of Service	$	295.00	
Meter Re-read / Leak Inspection Fee	$	140.00	
Meter Accuracy Test Fee	$	380.00 + Cost		
Missing or Damaged Equipment Fees			
Padlock	$	20.00	
Locking Device	$	20.00	
Meter, any other than hydrant	At Cost		
Meter Box - Lid Replacement	$	30.00	
Meter Box - Full Replacement	$	155.00	
Hydrant Meter	$	500.00	

ADMINISTRATIVE CHARGES		
Late Payment Charge (1)	$	15.00	
Returned Check Fee (2)			
Face Amount <= $50	$	25.00	
Face Amount > $50 and <= $300	$	30.00	
Face Amount > $300	$	40.00	
Face Amount > $800	5% of face value of check

Illegal Water Use (Fine plus actual usage)	
First Offense	$	980.00	
Repeat Offense	$	2,000.00	

Notes:

Greater of fixed fee or 1.5% of unpaid balance.
As per FL Statutes 832.07 and 832.08.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Miscellaneous Charge Findings, Conclusions, and Recommendations
Findings and Conclusions
During the course of the Study, it was observed that:
The District should adopt a comprehensive list of miscellaneous charges and
The proposed miscellaneous charges are reasonable.
Recommendations
Based upon the reviews, analyses and assumptions developed and discussed throughout the Report, and the resulting conclusions provided above, it is respectfully recommended that the District:
Adopt the miscellaneous charges proposed herein, as shown on Table 9, with an effective date of November 1, 2025; and
Adopt provisions for a comprehensive review of the miscellaneous charges every five (5) years, or whenever significant changes occur in costs, utility regulations, technical aspects, or the method of delivery of utility services.

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025

Section 8 - Findings, Conclusions, and Recommendations
General
In the development of the proposed user rates and charges, certain historical reviews and analyses have been performed, together with the application of assumptions based on prudent financial, operational, and ratemaking relationships. The cost criteria and customer usage characteristics associated with general ratemaking procedures are representative of averages and are not intended as indicators of any individual customer.
In the preparation of the Study, certain assumptions have been made with respect to conditions that may occur in the future. While it is believed that these assumptions are reasonable for the purpose of this Study, they are dependent upon future events and actual conditions may differ from those assumed. In addition, the Study has used and relied upon certain information that was provided by other parties not associated with Willdan. Such information includes, among other things, the District’s proposed CUP gallonage limit request, initial operating expense projections, customer phasing and absorption information, periodic reports, and other information and data provided by the District, developers, and other sources. While the sources are believed to be reliable, there has been no independent verification of the information, and no assurances are offered with respect thereto. To the extent that future conditions differ from those assumed herein or provided by others, the actual results may vary from those projected.
Findings and Conclusions
As previously addressed, the main purpose of this Study is to develop irrigation rates for the District’s Utility that promote water resource conservation. Additionally, this Study developed a five-year proforma operating analysis to determine what additional rate adjustments, if any, are necessary to meet the budgeted and/or projected financial needs in future years. This Report is the result of the collaborative efforts of representatives from both the District and Willdan. The District staff were diligent and cooperative in their efforts to ensure the availability and quality of source data on financial and operating matters. Based on the reviews, analyses and assumptions discussed herein, it is concluded that:
The proposed user rates and charges are anticipated to generate sufficient revenues to meet the revenue requirements of the system based upon the projected expenditures, transfers, customers, and billable flows estimated for the Projection Period. The proposed rate adjustments are based on an assumed implementation beginning on November 1, 2025. These rates are shown on Table 8.
The proposed miscellaneous charge adjustments have been developed based on a build- up method which includes time and materials costs of providing each service. The

Irrigation Rate Study	Draft Report
Wellness Ridge Community Development District	September 2025 proposed Miscellaneous charge adjustments shown on Table 9 are projected to be implemented on November 1, 2025.
The economic conditions affecting the nation in recent years have had a significant impact on housing markets throughout the southeast region. Changes in the market for new housing have a direct impact on the customer growth of utility systems providing service within those markets. The continued economic changes make it increasingly difficult to forecast financial expectations, both in the short run and particularly over a 5-year Projection Period as developed in this Report. As such, it would be prudent management practice to readdress the analyses developed herein on an annual basis in order to determine if the major assumptions and projections should be revised.
Recommendations
Based upon the reviews, analyses and assumptions developed and discussed throughout the Report, generally accepted principles of ratemaking, requirements of Florida Statutes, and consideration of community standards, it is recommended that the District:
Adopt the proposed monthly user rates effective November 1, 2025;
Adopt the proposed miscellaneous charges shown on Table 9 effective November 1, 2025
Adopt the proposed schedule of annual rate adjustments for fiscal years 2027 through 2030 of 3.50% for irrigation;
Perform an irrigation revenue sufficiency evaluation on a minimum of a bi-annual basis to assess the overall impacts of the District’s water conservation efforts and continue to ensure adequate operating revenues; and
Adopt provisions for a comprehensive review of the irrigation rate structure and rates a minimum of every 5 years, or whenever significant changes occur in costs, debt service, utility regulations, technical aspects, customer demand characteristics, or the method of delivery of utility services.
The expenses, costs, and criteria associated with ratemaking are representative of averages that are developed primarily from historical data or projections based on opinions and assumptions. Significant amounts of historical review and analysis, together with the development of assumptions based on prudent engineering, financial, and ratemaking relationships were utilized in the development of the customers, operating activity, costs and proposed fees and charges. Some of the assumptions will inevitably change or not materialize, and unanticipated events may occur which could significantly change the results presented herein.

Exhibits

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
REVENUES AND EXPENSES - IRRIGATION	Exhibit 1

Acct	Description	
		
	REVENUES	
100	Irrigation Sales	
105	Developer Contribution	
		
	TOTAL REVENUES	
	
	GROWTH ASSUMPTIONS - REVENUES	
100	Irrigation Sales	
	Irrigation Sales	
	Irrigation Sales	

	OPERATING EXPENSES	
	Operating	
	TOTAL OPERATING EXPENSES	
		
	CAPITAL OUTLAY	
	Operating	
	TOTAL CAPITAL OUTLAY	
		
	DEBT SERVICE	
	Existing Debt	
	New Debt	
	TOTAL DEBT SERVICE	
		
	TRANSFERS/CONTINGENCIES	
	Transfer Out	
	Transfer In	
	TOTAL TRANSFERS/CONTINGENCIES	
		
	NET EXPENSES	

Projected	Projected	Projected	Projected	Projected	
2026	2027	2028	2029	2030	

$	284,512	$	403,907	$	446,591	$	462,686	$	478,997	
$	-	$	-	$	-	$	-	$	-	
					
$	284,512	$	403,907	$	446,591	$	462,686	$	478,997	

					
0.0%	3.5%	3.5%	3.5%	3.5%	
0.00%	0.00%	0.00%	0.00%	0.00%	

					
$	231,734	$	317,248	$	354,012	$	366,755	$	379,957	
$	231,734	$	317,248	$	354,012	$	366,755	$	379,957	
			103.60%	103.60%	
					
$	-	$	-	$	-	$	-	$	-	
$	-	$	-	$	-	$	-	$	-	

$	-	$	-	$	-	$	-	$	-	
$	-	$	-	$	-	$	-	$	-	
$	-	$	-	$	-	$	-	$	-	

$	20,000	$	25,000	$	50,000	$	75,000	$	80,000	
$	-	$	-	$	-	$	-	$	-	
$	(20,000)	$	(25,000)	$	(50,000)	$	(75,000)	$	(80,000)	
					
$	251,734	$	342,248	$	404,012	$	441,755	$	459,957	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
REVENUES AND EXPENSES - IRRIGATION	Exhibit 1

Acct	Description		Projected	Projected	Projected	Projected	Projected	
			2026	2027	2028	2029	2030	
OPERATING								
								
200	Program Management		$	8,800	$	9,984	$	10,383	$	10,798	$	11,230	
205	Billing Support		$	38,000	$	51,223	$	56,183	$	58,430	$	60,767	
210	Dedicated Phone Line		$	550	$	621	$	643	$	666	$	689	
215	Supplies - Billing sheets, envelopes, postage		$	20,279	$	27,225	$	29,725	$	30,765	$	31,842	
220	Administrative Expenses		$	2,292	$	2,588	$	2,679	$	2,773	$	2,870	
225	Weekly Inspections - System Operation		$	57,813	$	83,923	$	100,022	$	103,523	$	107,146	
230	Maintenance and Repair		$	17,733	$	23,807	$	25,993	$	26,903	$	27,845	
235	Repair and Maintenance Materials		$	6,089	$	8,175	$	8,926	$	9,238	$	9,561	
240	Engineering Support		$	4,400	$	4,968	$	5,142	$	5,322	$	5,508	
245	Electric		$	43,845	$	58,863	$	64,269	$	66,518	$	68,846	
250	Annual Cellular Cost for Meter		$	14,646	$	19,663	$	21,469	$	22,220	$	22,998	
255	Reserve		$	20,000	$	25,000	$	50,000	$	75,000	$	80,000	
260	Insurance		$	7,308	$	8,251	$	8,540	$	8,839	$	9,148	
265	Management Fee		$	9,979	$	17,957	$	20,038	$	20,760	$	21,507	
								
	Total Personnel		$	-	$	-	$	-	$	-	$	-	
	Total Operating		$	231,734	$	317,248	$	354,012	$	366,755	$	379,957	
	Total Debt Service		$	-	$	-	$	-	$	-	$	-	
	Total Capital Outlay		$	-	$	-	$	-	$	-	$	-	
	Total Transfers		$	20,000	$	25,000	$	50,000	$	75,000	$	80,000	
								
	Total Operating		$	251,734	$	342,248	$	404,012	$	441,755	$	459,957	
	Check		TRUE	TRUE	TRUE	TRUE	TRUE	
								
IRRIGATION DEBT SERVICE								
	Irrigation Debt Service							
	New Debt		$	-	$	-	$	-	$	-	$	-	
	Total Irrigation Debt Service		$	-	$	-	$	-	$	-	$	-	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
REVENUES AND EXPENSES - IRRIGATION	Exhibit 1

Acct	Description	
	GROWTH ASSUMPTIONS - EXPENSES	
		
OPERATING		
		
200	Program Management	
205	Billing Support	
210	Dedicated Phone Line	
215	Supplies - Billing sheets, envelopes, postage	
220	Administrative Expenses	
225	Weekly Inspections - System Operation	
230	Maintenance and Repair	
235	Repair and Maintenance Materials	
240	Engineering Support	
245	Electric	
250	Annual Cellular Cost for Meter	
255	Reserve	
260	Insurance	
265	Management Fee	
0	0	
0	Total Personnel	
0	Total Operating	
0	Total Debt Service	
0	Total Capital Outlay	
0	Total Transfers	
0		
0	Total Operating	
0		
0		

Projected	Projected	Projected	Projected	Projected	
2026	2027	2028	2029	2030	

					
					
4.0%	4.0%	4.0%	4.0%	4.0%	
18.5%	23.6%	9.7%	4.0%	4.0%	
3.5%	3.5%	3.5%	3.5%	3.5%	
18.0%	23.1%	9.2%	3.5%	3.5%	
3.5%	3.5%	3.5%	3.5%	3.5%	
18.0%	33.1%	19.2%	3.5%	3.5%	
18.0%	23.1%	9.2%	3.5%	3.5%	
18.0%	23.1%	9.2%	3.5%	3.5%	
3.5%	3.5%	3.5%	3.5%	3.5%	
18.0%	23.1%	9.2%	3.5%	3.5%	
18.0%	23.1%	9.2%	3.5%	3.5%	
14.5%	19.6%	5.7%	0.0%	0.0%	
3.5%	3.5%	3.5%	3.5%	3.5%	
4.5%	6.0%	6.0%	6.0%	6.0%	

					

					

					

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
DETERMINANTS - ACCOUNTS and FLOW	Exhibit 2

Line	Rate Design	
	Description	Determinant	Reliability	Weighting	Total	
		2026	Factor	Factor		

ACCOUNTS/DWELLING UNITS (Per Month)

Accounts/Dwelling Units:

1	SFD 60	72.00	1.00	1.0000	72.00	
2	SFD 50	472.00	1.00	1.0000	472.00	
3	SFD 41 FL	129.00	1.00	1.0000	129.00	
4	SFD 40 RL	133.00	1.00	1.0000	133.00	
5	SFD 32 RL	163.00	1.00	1.0000	163.00	
6	TH 25 RL	98.00	1.00	0.2500	24.50	
7	TH 22	161.00	1.00	0.2500	40.25	
8	Common Areas	1.00	1.00	1.0000	1.00	
9	Total Accounts/Dwelling Units:	1,229.00			1,034.75	
		USAGE				

10	
Usage (1,000 gallons):
Tier 1	

67,826.00	

0.96	

1.0000	

65,112.96	
11	Tier 2	-	0.96	2.5000	-	
12	Total Usage (1,000 gallons):	67,826.00			65,112.96	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
IRRIGATION RATE DESIGN	Exhibit 3

Line	Percent	Proposed Rate Year
Description
Allocation	2026	

1	Annual Revenue Requirement		
$	
251,734	
2	Unrestricted Reserve Fund Balance Adjustment (5%)			12,587	
3	Contingency (5%)			12,587	
4	Total Annual Revenue Requirement		$	276,907	
5	Allocation to Base Charge	40.00%	$	110,763	
6	Allocation to Usage Charge	60.00%	$	166,144	

	Base Charge Determinants					
7	Average Monthly Accounts:			1,035	
Calculated Fixed Monthly Cost Per Account/ERC:
8	Revenue Reqmt. Allocation to Fixed Costs		
$	
110,763	
Plus: System Allocation Adjustment
Plus: Other Adjustment			-
-	
11	Subtotal Base Charge Revenue Requirement		$	110,763	
12	Average Monthly Accounts			1,035	
13	Monthly Fixed Cost Per Account/ERC		$	9.74	

14	Proposed Base Charge:		
$	
9.74	
15	Base Charges Revenues:		$	110,863	
Revenue Recovery Analysis:
16	Allocated Fixed Costs		
$	
110,763	
17	Less Base Charge Revenues		$	110,863	
18	Amount Over/(Under) Allocation		$	100	
19	Reallocation To/(From) Volumetric		$	(100)	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
IRRIGATION RATE DESIGN	Exhibit 3

Proposed Rate Year
2026

Percent
Allocation

Description

Line

	Usage Rate Determinants	

20	Total Billed Flows (kGal):	65,113

	Calculation of Usage Rates	

Volumetric Charge Revenue Requirement:
21	Allocated Volumetric Costs (Revenue Reqmt)	$	166,144	
22	Plus: Minimum Charge Rev. Rqmt. Unrecovered		(100)	
23	Plus: System Allocation Adjustment		-	
One Time Planning Adjustment			
Total Rev. Reqmt to be Recovered in the			
24	Volumetric Rate Component	$	166,044	
25	Total Estimated Billable Usage Determinants		65,113	
26	Calculated Rate Per 1,000 Gal	$	2.56	
27	Irrigation Volumetric Rate:	$	2.56	
28	Total Revenues From Volumetric Rates:	$	166,689.18	
Revenue Recovery Analysis:			
29	Customer Charge Component Revenue	$	-	
30	Base Charge Component Revenue		110,863	
31	Usage Charge Component Revenue		166,689	
32	Total Irrigation System Revenues	$	277,552	
33	Less: Total TY Rev. Rqmt	$	276,907	

IRRIGATION SYSTEM REVENUE REQUIREMENT
34	OVER/(UNDER) RECOVERY	

$	

645	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
PROJECTED OPERATING RESULTS - IRRIGATION	Exhibit 4

Line

Description

Proposed	Projected for Fiscal Year Ending September 30,	
2026	2027	2028	2029	2030	

REVENUES

Operating Revenues
1	Irrigation Service Charges	$	284,512	$	403,907	$	446,591	$	462,686	$	478,997	
2	Percentage Revenue Adjustment	0.00%	3.50%	3.50%	3.50%	3.50%	
Volumetric Charge - Percentage Rate Adjustment	0.00%	3.50%	3.50%	3.50%	3.50%	
					
Other Operating Revenues	
3	Capacity Fees	$	0	$	0	$	0	$	0	$	0	
4	Miscellaneous Revenues	0	0	0	0	0	
							
Other Non-Operating Revenues						
5	Interest	$	0	$	1,050	$	2,020	$	3,070	$	4,300	
						
6	Total Revenues	$	284,512	$	404,957	$	448,611	$	465,756	$	483,297	
						
Current Expenses						
7	Operating	$	231,734	$	317,248	$	354,012	$	366,755	$	379,957	
8	Total Current Expenses	$	231,734	$	317,248	$	354,012	$	366,755	$	379,957	
						
9	Net Results of Operations	$	52,778	$	87,709	$	94,599	$	99,001	$	103,340	
10	Capital Outlay	-	-	-	-	-	
11	Transfers In	-	-	-	-	-	
12	Transfers Out	(20,000)	(25,000)	(50,000)	(75,000)	(80,000)	
						
13	Net Results	$	32,778	$	62,709	$	44,599	$	24,001	$	23,340	

RESERVE FUND BALANCE ACTIVITY						
						
O&M Fund Balance (501)						
14	Beginning Fund Balance	$	-	$	32,778	$	95,487	$	140,086	$	164,087	
15	Deposit/(Withdrawal) from Operations	32,778	62,709	44,599	24,001	23,340	
16	Transfer from/(to) Capital Fund	-	-	-	-	-	
17	Ending Fund Balance	$	32,778	$	95,487	$	140,086	$	164,087	$	187,427	
18	Targeted Fund Balance	$	57,140	$	78,226	$	87,291	$	90,433	$	93,688	
19	Variance	$	(24,362)	$	17,261	$	52,795	$	73,654	$	93,739	
20	Days Cash on Hand	52	110	144	163	180	
21	Targeted Days Cash on Hand	90	90	90	90	90	
						
Capital Reserve (502)						
22	Beginning Fund Balance	$	-	$	20,000	$	45,000	$	95,000	$	170,000	
23	Transfer from/(to) O&M Fund	20,000	25,000	50,000	75,000	80,000	
24	Capital Projects From Capital Improvement Plan	-	-	-	-	-	
25	Ending Fund Balance	$	20,000	$	45,000	$	95,000	$	170,000	$	250,000	
						
26	Total Fund Balance	$	52,778	$	140,487	$	235,086	$	334,087	$	437,427	

Wellness Ridge Rate Model - FINAL DRAFT REPORT

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM

TYPICAL MONTHLY BILL								Exhibit 5	

Line	Customer Type	
Gallons		Monthly Charges
FY 2026	FY 2026
Clermont	Wellness Ridge CDD		Difference	
$ Amount	Percent	
	SFD 60		
1	All	0	$	9.99	$	9.74	$	(0.25)	-2.50%	
2	All	1,000	$	12.60	$	12.30	$	(0.30)	-2.38%	
3	All	2,000	$	15.21	$	14.86	$	(0.35)	-2.30%	
4	All	3,000	$	17.82	$	17.42	$	(0.40)	-2.24%	
5	All	4,000	$	20.43	$	19.98	$	(0.45)	-2.20%	
6	All	4,300	$	21.21	$	20.75	$	(0.47)	-2.19%	
7	All	5,000	$	23.04	$	25.23	$	2.19	9.50%	
	
SFD 50									
8	All	0	$	9.99	$	9.74	$	(0.25)	-2.50%	
9	All	1,000	$	12.60	$	12.30	$	(0.30)	-2.38%	
10	All	2,000	$	15.21	$	14.86	$	(0.35)	-2.30%	
11	All	3,000	$	17.82	$	17.42	$	(0.40)	-2.24%	
12	All	3,300	$	18.60	$	18.19	$	(0.42)	-2.23%	
13	All	4,000	$	20.43	$	22.67	$	2.24	10.95%	
14	All	5,000	$	23.04	$	29.07	$	6.03	26.16%	
	
SFD 41 FL									
15	All	0	$	9.99	$	9.74	$	(0.25)	-2.50%	
16	All	1,000	$	12.60	$	12.30	$	(0.30)	-2.38%	
17	All	2,000	$	15.21	$	14.86	$	(0.35)	-2.30%	
18	All	2,700	$	17.04	$	16.65	$	(0.38)	-2.26%	
19	All	3,000	$	17.82	$	18.57	$	0.75	4.22%	
20	All	4,000	$	20.43	$	24.97	$	4.54	22.23%	
21	All	5,000	$	23.04	$	31.37	$	8.33	36.16%	
	
SFD 40 RL									
22	All	0	$	9.99	$	9.74	$	(0.25)	-2.50%	
23	All	1,000	$	12.60	$	12.30	$	(0.30)	-2.38%	
24	All	2,000	$	15.21	$	14.86	$	(0.35)	-2.30%	
25	All	2,600	$	16.78	$	16.40	$	(0.38)	-2.27%	
26	All	3,000	$	17.82	$	18.96	$	1.14	6.37%	
27	All	4,000	$	20.43	$	25.36	$	4.93	24.11%	
28	All	5,000	$	23.04	$	31.76	$	8.72	37.83%	

WELLNESS RIDGE CDD, FL
IRRIGATION SYSTEM
TYPICAL MONTHLY BILL	Exhibit 5

Line	Customer Type	
Gallons	Monthly Charges		Difference		
			FY 2026
Clermont	FY 2026
Wellness Ridge CDD	$ Amount	Percent	

	SFD 32 RL	

29	All	0	$	9.99	$	9.74	$	(0.25)	-2.50%	
30	All	1,000	$	12.60	$	12.30	$	(0.30)	-2.38%	
31	All	2,000	$	15.21	$	14.86	$	(0.35)	-2.30%	
32	All	2,400	$	16.25	$	15.88	$	(0.37)	-2.28%	
33	All	3,000	$	17.82	$	19.72	$	1.90	10.68%	
34	All	4,000	$	20.43	$	26.12	$	5.69	27.87%	
35	All	5,000	$	23.04	$	32.52	$	9.48	41.16%	

Multi-Unit	TH 22 & TH 25 RL - 66 units	
36	All	0	$	9.99	$	160.71	$	150.72	1508.71%	
37	All	25,000	$	96.54	$	224.71	$	128.17	132.76%	
38	All	50,000	$	226.09	$	288.71	$	62.62	27.70%	
39	All	75,000	$	362.84	$	352.71	$	(10.13)	-2.79%	
40	All	99,000	$	494.12	$	414.15	$	(79.97)	-16.18%	
41	All	125,000	$	636.34	$	580.55	$	(55.79)	-8.77%	
42	All	150,000	$	773.09	$	740.55	$	(32.54)	-4.21%	
43	All	175,000	$	909.84	$	900.55	$	(9.29)	-1.02%	
44	All	200,000	$	1,046.59	$	1,060.55	$	13.96	1.33%	
45	All	225,000	$	1,183.34	$	1,220.55	$	37.21	3.14%	
46	All	250,000	$	1,320.09	$	1,380.55	$	60.46	4.58%	
47	All	275,000	$	1,456.84	$	1,540.55	$	83.71	5.75%	
48	All	300,000	$	1,593.59	$	1,700.55	$	106.96	6.71%	
49	All	325,000	$	1,730.34	$	1,860.55	$	130.21	7.53%	
50	All	350,000	$	1,867.09	$	2,020.55	$	153.46	8.22%	
51	All	375,000	$	2,003.84	$	2,180.55	$	176.71	8.82%	

200 South Orange Avenue, Suite 1550
Orlando, FL 32801
Phone: 407.872.2467 | Fax: 888.326.6864
www.willdan.com