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<br />City of Lino Lakes, Minnesota P a g e | 1 <br /> <br /> <br />1. Introduction <br /> <br />1. Introduction <br />Baker Tilly was hired to review and analyze the City of Lino Lakes’s Water and Sewer <br />Funds to determine the appropriate rate structures and other revenue sources needed <br />for operations and the financing of capital improvements. The rate structure and other <br />revenue in each Fund must provide sufficient revenue to cover anticipated operating <br />and maintenance expenses, debt service including principal and interest, capital <br />improvements and replacements, and to maintain adequate cash reserves. The total <br />revenue collected should reflect not only recent cost experience but should recognize <br />anticipated future costs during the period for which rates are being established. <br />This report includes a review of the City’s Water Fund, Sewer Fund and Area and Unit <br />Charge Fund, including their historical operating revenues and expenses, 2020 <br />estimated revenues and expenses, and the 2021 budget for each fund. Based on this <br />review, a determination of the rates and charges necessary to provide revenues <br />sufficient to cover the projected cost of operation, maintain the capital infrastructure, <br />and to provide adequate cash reserves were developed. The analysis also reviews <br />the potential impacts of a proposed new water treatment plant.