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515 Little Canada Road, Little Canada, MN 55117-1600 <br />(651) 484 -2177 / FAX: (651) 484 -4538 <br />MEMORANDUM <br />TO: Mayor Fahey & Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: March 15, 1999 <br />RE: 1999 Revised Sewer/Water Budgets & Water Rate Increase <br />MAYOR <br />Michael I. Fahey <br />COUNCIL <br />Beverly Scalze <br />Jim LaValle <br />Steve Morelan <br />Bob Pedersen <br />ADMIMSI ATOR <br />Joel R. Hanson <br />Attached are revised budget estimates for our water and sewer enterprise funds. These have been <br />revised based on 1998 actual information. Based on this information, it appears that no increase <br />is necessary in our sewer rates for 1999 (last increased in 1998), but an increase is necessary in <br />the water fund (last increased in 1997). I am projecting a 3 '' /z% increase in water rates effective <br />on 18` quarter billings in 1999. With this increase, we are still projecting a small deficit that I feel <br />is reasonable for this fund given the potential swings that are possible due to summer watering <br />needs. The majority of this increase is necessary due to the increase in the costs of water <br />purchases from the St. Paul Board of Water Commissioners (our estimate is projected at 2.93 %). <br />The balance will offset additional operating costs from City expenses. Also attached is a survey <br />on water rates. As you can see, our proposed rate increase is competitive with neighboring <br />cities. <br />I believe this recommendation is consistent with the Council's desire to have smaller annual <br />increases rather than larger "make up" increases. I would recommend we adopt the rate <br />increased as proposed. <br />JRH:kpp <br />Enclosures <br />Page 146 <br />