Management Report and Recommendations 12/31/1991

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City of Lino Lakes, Minnesota Management Report, Page 42 There are two basic factors which contribute to increased billings from the MWCC: 1. Changes in use of the system. The MWCC has increased the 1992 estimated flow for the City of Lino Lakes by 25%. 2. Increased cost to process sewage. The MWCC's cost to process (per million gallons) increased to an estimated $1,157 in 1992 from an estimated $1,084 in 1991. This represents an increase of 6.7%. The combination of the above factors has increased the City's estimated cost in 1992 by 33%. During 1988, the City adjusted sewer and water rates. The change became effective on July 1, 1988. Part of the adjustment was to include a charge for core system improvements. The add on charge was to be calculated based on a fixed amount per quarter. This charge is collected as revenue of the Enterprise Fund along with normal user charges. Such amounts are then transferred to the Area and Unit Charge Fund which financed (or will finance) such improvement During 1990 the City transferred $80,365 to the Area and Unit Charge Fund for 1988 - 1990. During 1991 the City transferred $52,320 to the Area and Unit Charge Fund. GAS UTILITY FUND Portions of the City of Lino Lakes have gas service through a franchise agreement between the City of Circle Pines and the City of Lino Lakes. The City of Circle Pines operates the gas utility. We have reviewed the initial distribution of gas franchise profits received by the City of Lino Lakes under the terms of the franchise agreement. The revenue was calculated on the following basis: 1991 1990 Residential and Commercial Revenue $227,175 @ 7% = $15,902 $166,471 @ 7% = $11,653 Interruptible Service 113,869 @ 3% = 3,416 108,699 @ 3% = 3,261 Total $341,044 19,318 .$2757170 14,914 Remitted by Circle Pines 19,286 Diff $32 14,910 $4