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<br />City of Lino Lakes, Minnesota P a g e | 24 <br /> <br /> <br />4.Sewer Utility <br /> <br />Financial projections with rate increases <br />A financial projection with recommended rate increases was developed for the Sewer <br />Fund. Similar to the Water Operating Fund, the rate increases are recommended <br />because the fund is showing operating losses each year at the current rates due primarily <br />to the depreciation expenses. The recommended increases are projected to result in <br />stable operating losses. These stable operating losses are acceptable because of the <br />strong cash position of this fund. Ending cash balance would decrease from <br />approximately $9.6 million projected at the end of 2021 to approximately $9.0 million <br />2031. <br />Scenario 2 <br />The financial projection for the Sewer Fund with recommended rate increases is shown <br />on the following page. The increases in revenues from charges for service include the <br />growth in the number of customers projected each year. The projections incorporate the <br />City’s planned capital improvements; however, they are fairly minimal, averaging <br />approximately $335,000/year over the planning period.