10-14-2020 Workshop Packet - Laserfiche WebLink

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STAFF REPORT TO: Mayor Keis and Members of City Council FROM: Chris Heineman, City Administrator Brenda Malinowski, Finance Director Bill Dircks, Public Works Director DATE: October 14, 2020 RE: Stormwater Utility Information Stormwater management has long been a major component of municipal operations, and the cost to maintain stormwater infrastructure is continually increasing. In the past two years alone the City has dealt with Twin Lake flooding, new ponds appearing where no ponds used to be, a hillside washout due to a storm pipe separating, and numerous small maintenance projects. The annual cost for the City’s MS4 permit through the MPCA is also expected to increase dramatically starting in 2021. The City was fortunate to get federal aid for Twin Lake and the stormwater washout on County Road B2, but the other items along with numerous deferred maintenance projects add up to significant expenditures and the City has limited funds available in our operating and Capital Improvement Plan (CIP) fund. Numerous other cities are facing the same reality. Many cities have established stormwater utility funds as a funding source to stay on top of stormwater maintenance and related projects. According to a nationwide study completed in 2019 by Western Kentucky University, there are 198 cities in Minnesota that have an established stormwater utility. That is the most of any state in the nation. The stormwater utilities include large urban municipalities like Minneapolis and St. Paul and small rural communities such as Ashby and Chokio. The study includes some information on cost per property per month and estimated annual revenues based on the data that could be found on each city’s website. There is a wide range of monthly fees and annual revenues that can be utilized for ongoing stormwater management activities. If sufficient funding is available, a stormwater utility fund can also be used for the stormwater infrastructure component of a street renovation or reconstruction project. On the recent Greenbrier Street reconstruction project, the stormwater component alone added up to 22% ($381,000 of $1.7 million) of the project cost. Bolton & Menk has completed numerous studies over the years and staff has had discussions with them on how to move forward. They have submitted a plan for arriving at the proper fee to charge and have outlined the costs to accomplish the plan. There may be ways to reduce the final plan cost by utilizing interns and possibly reducing the number of meetings that are held internally. A copy of the proposal submitted by Bolton & Menk is included with this report.