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Water Utility 16 City of Lino Lakes, Minnesota – Water and Sewer Rate Study Update Tier 1 38.2% Tier 2 30.0% Tier 3 25.1% Tier 4 5.5% Tier 5 1.2% Residential Accounts by Tier summer average (2010 ‐2011) Summer consumption statistics include: Summer water use (Quarter 3, 2010 & 2011 data)  68.2% of residential users use 40,00 0 gallons or less, falling into the first two tiers of use.  1,290 or 31.8% of residential customers use 40,000 gallons or more in the summer months, which is over 21 times what customers use in winter.  47 or 1.2% of residential customers use 120,000 gallons or more in the summer months. In the 2012 the Minnesota Legislature redefined the water conservation requirements now calling them demand reduction measures. The law now states that “public water suppliers serving mo re than 1,000 people must encourage water conservation by employing water use demand reduction measures” as opposed to the initial law requiring “a conservation rate structure”. The law goes on further to state, “Demand reduction measures must include a conservation rate structure, or a uniform rate structure with a conservation program that achieves demand reduction.” Therefore, the City can alter its current five-tiered system so long as it reduces water demand, water losses, peak water demands, and nonessential water uses. We have provided four options for future water rates; 1) leave the current fi ve-tiered system the same but adjust the volume charge if necessary, 2) provide on e rate for each user class (residential, non-residential, and non-residential irri gation) that will generate revenues from each user class that the current block rates do, 3) go to one rate for all water use, or 4) reduce the five-tiered system to something less.