03/26/2001 Council Minutes - Laserfiche WebLink

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COUNCIL MINUTES MARCH 26, 2001 Water The City's water rates are based on a quarterly charge per REU and a charge on water usage. The usage charge is based on 1,000 gallon units. The major expenses related to water charges include the cost of operating the system, bond expenses, and depreciation. The bond expenses would be offset by a transfer from the Area and Unit Fund. The water rate computation also assumes a 220 unit increase in the number of connections on an annual basis. In order to satisfy the Department of Natural Resources concerns regarding water appropriation (pumping) the proposed rate structure increases the rate per gallon for heavier water use. This also keeps the base rate for the lower water users very close to the existing level. The current water rate is $10.00 per quarter per REU and $1.63 per 1,000 gallons. The proposed water rate increase is as follows: Effective March 26, 2001 through December 31, 2003: Water Usage Rates: $1.77 per 1,000 gallons $2.07 per 1,000 gallons Water User Fee: 0 to 30,000 gallons all water use abov $10.00 • er The average household uses approxi ons of water per quarter. Based on this information, the average increase e s fo sanitary sewer and water per quarter will be from $109.90 in 2000 to $123.10 i Mayor Bergeson inqu Council. Finance Dire Met Council will recei ow the expenses for sanitary sewer break out for the Metropolitan dvised the budget in 2001 is just over one million dollars. The ximately $467,000, which is about 45%. Council Member Reinert asked if the dollars that go to the Metropolitan Council are based on a percentage. Finance Director Rolek advised the fee is based on the amount of water the Met Council treats directly from the City of Lino Lakes. The water is measured and the City does get billed for that amount. Council Member Dahl asked what the Metropolitan Council was charging in the past and what the City was paying. She asked if that is why the City has a deficit for the utility. Finance Director Rolek stated the City has had a deficit in the past because the City is not charging enough to cover the costs of the system. The major expense related to that is the depreciation that includes the replacement costs of the system. The City has not been generating enough revenue to cover that expense. The proposed rates will cover the costs of replacing the system. 3