06/22/2026
Clarification Regarding City Budgeting and Utility Funds
The City of Reading has become aware of misinformation circulating regarding City finances, employee compensation, and the use of water and sewer funds. We believe it is important to provide accurate information to residents regarding how municipal budgeting works.
The City Manager, as well as other City employees, do not receive a percentage of water and sewer revenues as compensation. The City of Reading’s Salary Allocation Table is approved as part of the City's annual budget process. Compensation is not tied to utility revenues, collections, or profits.
Like many municipalities, the City allocates personnel costs among various funds, including the General Fund, Water Fund, Sewer Fund, Refuse Fund, Major & Local Street Funds and Equipment Fund. This is a standard governmental accounting practice and is required to ensure that each fund pays its fair share of the costs associated with operating that service.
For example, if an employee spends a portion of their work time performing duties related to the water or sewer system—such as utility billing, customer service, financial management, regulatory compliance, infrastructure planning, reporting, or system administration—a corresponding percentage of that employee's salary and benefits may be charged to the Water or Sewer Fund. The percentage is based on the estimated amount of time devoted to those functions and is applied to the employee's salary or wage amount.
This does not mean the employee receives additional compensation from those funds, nor does it mean they are paid a percentage of utility revenues. It simply means that the cost of providing utility-related services is allocated to the utility funds based on an employees salary or wage, rather than being borne entirely by property tax dollars through the General Fund. NO EMPLOYEE IS EVER PAID NOR EVER HAS BEEN PAID A PERCENTAGE OF ANY REVENUES.
This accounting method helps ensure that utility operations are funded by utility revenues and that taxpayers are not subsidizing services that directly benefit utility customers. These practices are reviewed annually through the budget process and are subject to an annual audit.
Thank you for allowing us the opportunity to clarify this information.
City of Reading Administration