HomeMy WebLinkAbout#16 - 2018 Utility Budgets
STAFF REPORT
DATE: December 5, 2017
REGULAR
ITEM #16
TO: Honorable Mayor and City Council FROM: Brian A. Swanson – Finance Director AGENDA ITEM: 2018 Utility Budgets – Resolution 2017-136 REVIEWED BY: Kristina Handt – City Administrator
BACKGROUND: The Finance Committee has been working on developing the Proposed 2018 Water, Sewer, and Storm Water Fund (utility) budgets for the last few months. Council reviewed them briefly during a joint meeting in August. The Finance Committee finalized their recommendations for the utility budgets at their October meeting and recommended consideration and approval by the City Council. The City Council reviewed the Proposed 2018 Utility Budgets and Rates on November 14th at the workshop and
directed staff to bring each of them back for consideration and approval. Process for this evening: 1) Information presented pertains to the Proposed 2018 Water, Sewer and Storm Water Fund Budgets.
2) Based on upon the results of the information provided and discussion, the City Council can consider the resolution adopting the 2018 Water, Sewer and Storm Water Fund Budgets attached to this report.
3) The detailed fee schedule will be part of the 2018 Fee Schedule agenda item for the City Council
to consider for adoption, which includes an ordinance and resolution. ISSUES BEFORE THE CITY COUNCIL: 1) Does the City Council have any questions about the Proposed 2018 Utility Fund Budgets?
2) Does the City Council desire to approve the Proposed 2018 Water, Sewer and Storm Water Budgets?
DISCUSSION: Attachment #1 includes the detailed Proposed 2018 Water, Sewer and Storm Water Budgets.
Revenues: The revenues for the funds are from the Utility Financial Management Plan presented by Northland Securities at the October 3rd regular City Council meeting. These assumptions are based upon the increased rates recommended in the report as well. In summary, here are the proposed rate increases:
1) Water Fund – Proposed three percent (3%) rate increase across the base and variable rates compared from the 2017 Adopted to 2018 Proposed. Water Availability Charge (WAC) and the Water Connection Charge would remain the same.
2) Sewer Fund – Proposed one percent (1%) rate increase for the commercial usage, residential usage, and residential base fee, compared from the 2017 Adopted to 2018 Proposed. Sewer Availability Charge (SAC) and the Sewer Connection Charge would remain the same. 3) Storm Water Fund – Service fee would increase by five dollars ($5.00) from the 2017 Adopted to 2018 Proposed. Expenses: Water Fund:
• Water Meter and Supplies: includes the purchase of 250 meters to continue the meter change out program to address old and failing meters at a cost of approximately $47,000.
• Small Tools & Equipment: includes $3,000 for a generator for water tower #3.
• Legal Services: increase of $150,000 due to reassignment of 3M litigation costs.
• Contract Services: contract for updating wellhead protection program as required by the state and
contract for Finance Director services totaling a $33,400 increase.
• Software Support: increase of approximately $27,500 for new finance software upgrades approved
by Council as well as ongoing IT costs.
• Water Utility: expect to be off Oakdale water by January so no costs proposed for this line item.
• Capital Outlay: utility vehicle replacement and water main oversizing costs totaling $137,500.
• Depreciation: removed since Capital Improvement Plan costs account for it.
• Bond Principal and Interest: increase of approximately $737,000 for debt service.
Sewer Fund:
• Small Tools & Equipment: reduced from last draft to remove all but necessary equipment for confined space maintenance tasks.
• Contract Services: increase of approximately $16,000 for Finance Director contract.
• Software Support: increase of approximately $28,000 for new finance software upgrades
approved by Council as well as ongoing IT costs.
• Sewer Utility-Met Council: this is the cities operations charge. Increase of approximately $48,000 is due to increase in customer volume.
• Capital Outlay: utility vehicle replacement (1/2 in water) and sewer main oversizing costs totaling $85,000.
• Depreciation: removed since Capital Improvement Plan costs account for it.
• Bond Principal and Interest: increase of approximately $343,000 for debt service.
Storm Water Expenses:
• Repair/Maintenance Supplies and Small Tools: increased by $3,500.
• Contract Services: Finance Director contract increase of approximately $7,000.
• Software Support: increase of approximately $7,000 for new finance software upgrades approved
by Council as well as ongoing IT costs.
• Street Sweeping: 2nd street sweeping added at a cost of $5,000.
• Capital Outlay: surface water plan required with Comp Plan update of approximately $20,000.
• Depreciation: removed since Capital Improvement Plan costs account for it.
• Bond Principal and Interest: increase of approximately $156,000 for debt service.
FISCAL IMPACT: The 2018 Proposed Utility Budgets will help support necessary city services to be provided in 2018. In addition, consideration of the impact of the decisions made today will help the City plan for the future with
the goal of sound fiscal management. RECOMMENDATION: 1) Motion to Adopt Resolution No. 2017-136 Adopting the 2018 Water, Sewer and Storm Water Fund Budgets.
ATTACHMENTS: 1) 2018 Proposed Utility Fund Budgets – 12-5-17 2) Resolution No. 2017-136 Adopting the 2018 Water, Sewer and Storm Water Fund Budgets
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
1
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
601 Water Fund
Water Fund Revenues:
601-000-0000-33422 PERA Pension Revenue - 525 - - - - #DIV/0!
601-000-0000-33426 Miscellaneous State Grants - 3,433,298 - - - - #DIV/0!
601-000-0000-36100 Special Assessments - 11,334 16,950 9,320 16,950 111,077 555.32%
601-000-0000-36205 Refunds and Reimbursements - - - 62 75 - #DIV/0!
601-000-0000-36210 Interest on Investments 26,985 13,987 20,000 - 20,000 20,000 0.00%
601-000-0000-37100 Water Sales 440,322 275,019 543,689 360,314 489,139 597,769 9.95%
601-000-0000-37120 Bulk Water 1,241 5,423 2,000 448 2,000 2,000 0.00%
601-000-0000-37140 Water Access Revenue 66,000 979,500 1,509,000 1,231,400 1,509,000 960,000 -36.38%
601-000-0000-37150 Water Connections - Municipal 1,237,500 244,500 369,000 338,147 369,000 320,000 -13.28%
601-000-0000-37170 Meter Sales 55,435 244,260 68,000 90,867 100,000 87,500 28.68%
601-000-0000-37180 Tower Rent 49,742 52,526 - - - - #DIV/0!601-000-0000-39210 Transfer In - (59,872) - - - - #DIV/0!
Total Water Fund Revenues:1,877,225$ 5,200,500$ 2,528,639$ 2,030,558$ 2,506,164$ 2,098,346$ -17.02%
Water Fund Expenses:
Personnel
601-494-9400-41010 Full-time Salaries 92,578 127,902 144,184 88,793 117,335 105,194 -27.04%
Safety Clothing Allowance - - - - 193 193 #DIV/0!
601-494-9400-41210 PERA Contributions 8,615 15,792 10,814 6,652 8,800 7,590 -29.81%
601-494-9400-41220 FICA Contributions 5,498 7,346 9,012 5,322 7,275 6,497 -27.91%
601-494-9400-41230 Medicare Contributions 1,286 1,718 2,091 1,245 1,701 1,525 -27.07%
601-494-9400-41300 Insurance 18,199 29,467 28,837 14,429 19,894 21,743 -24.60%
601-494-9400-41301 Unemployment Insurance - - - - 1,093 683 #DIV/0!601-494-9400-41510 Workers Compensation 2,472 1,904 5,767 3,980 5,526 5,884 2.03%
Total Personnel 128,647$ 184,130$ 200,705$ 120,421$ 161,817$ 149,309$ -25.61%
Materials and Supplies
601-494-9400-42000 Office Supplies 1,933 771 700 579 700 800 14.29%
601-494-9400-42030 Printed Forms 239 499 750 247 550 750 0.00%
601-494-9400-42150 Operating Supplies - - - - - 1,000 #DIV/0!
601-494-9400-42160 Chemicals 1,473 3,157 13,000 3,587 10,000 13,000 0.00%
601-494-9400-42210 Repair/Maint. Supplies 25,257 25,014 25,000 2,080 20,000 26,000 4.00%
601-494-9400-42300 Water Meters & Supplies 82,343 105,477 85,000 117,435 125,000 132,000 55.29%
601-494-9400-44375 Personal Protective Equipment - - - - - 800 #DIV/0!
601-494-9400-42400 Small Tools & Minor Equipment 5,016 3,955 5,000 1,908 3,500 8,300 66.00%
Total Materials and Supplies 116,263$ 138,874$ 129,450$ 125,836$ 159,750$ 182,650$ 41.10%
Charges and Services
601-494-9400-43030 Engineering Services 14,725 - 20,000 14,909 20,000 20,000 0.00%
601-494-9400-43040 Legal Services 388 2,323 5,000 93,738 125,000 155,000 3000.00%
601-494-9400-43150 Contract Services 16,305 7,459 14,000 20,622 40,000 47,400 238.57%
601-494-9400-43180 Software Support 4,774 5,556 9,600 10,088 16,479 37,133 286.81%
601-494-9400-43210 Telephone 775 793 800 504 800 800 0.00%
601-494-9400-43220 Postage 2,500 1,800 1,880 (1,322) 750 2,000 6.38%
601-494-9400-43310 Mileage - 189 - - - - #DIV/0!
601-494-9400-43610 Insurance 6,799 8,975 10,000 9,322 10,000 12,000 20.00%
601-494-9400-43810 Electric Utility 33,410 34,392 30,000 35,523 45,000 45,000 50.00%
601-494-9400-43820 Water Utility 107,029 144,932 - 177,093 210,000 - #DIV/0!
601-494-9400-44030 Repairs\Maint Imp Not Bldgs 7,116 8,617 10,000 4,735 8,000 20,000 100.00%
Repairs/Maint. Equip.- - - - - 8,000 #DIV/0!
Repairs\Maint Imp Bldgs - - - - - 2,000 #DIV/0!
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
2
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
Equipment Rental - - - - - 1,000 #DIV/0!
601-494-9400-44370 Conferences & Training 460 103 1,500 1,118 1,500 2,000 33.33%
Total Charges and Services 194,281$ 215,140$ 102,780$ 366,330$ 477,529$ 352,333$ 242.80%
Capital Outlay
601-494-9400-45300 Improvments Other Than Bldgs 42 - - 22,430 22,430 137,500 #DIV/0!
Total Capital Outlay 42$ -$ -$ 22,430$ 22,430$ 137,500$ #DIV/0!
Miscellaneous and Non-operating
601-494-9400-43320 Depreciation Expense 557,626 612,353 598,971 - - - -100.00%
601-494-9400-44300 Miscellaneous 188 3,178 2,000 2,423 2,600 2,000 0.00%
601-494-9400-46010 Bond Principal 0 - - 279,663 485,000 710,000 #DIV/0!
601-494-9400-46110 Bond Interest 351,742 241,142 273,321 235,319 273,321 300,775 10.04%
601-494-9400-46200 Fiscal Agent Fees - Bond Payments 1,189 16,014 800 180 800 856 7.00%
601-494-9400-46250 Fiscal Agent Fees - Bond Issuance (11,720) - 53,811 - - - -100.00%
601-494-9400-47200 Transfer Out - 40,427 - - - - #DIV/0!
Total Misc. and Non-operating 899,025$ 913,113$ 928,903$ 517,584$ 761,721$ 1,013,631$ 9.12%
Total Water Fund Expenses:1,338,258$ 1,451,257$ 1,361,838$ 1,152,601$ 1,583,247$ 1,835,423$ 34.78%
Total Water Fund Revs. Over/(Under) Expenses:538,967$ 3,749,243$ 1,166,801$ 877,957$ 922,917$ 262,923$ -77.47%
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
3
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
602 Sewer Fund
Sewer Fund Revenues:
602-000-0000-36100 Special Assessments - 21,073 62,133 33,535 62,133 77,874 25.33%
602-000-0000-36210 Interest on Investments 9,929 14,584 12,699 - 15,000 20,000 57.49%
602-000-0000-37200 Sewer Sales 61,920 120,974 177,228 96,416 177,228 247,599 39.71%
602-000-0000-37220 SAC Early Pay discount/revenue 3,227 8,474 - 5,168 5,800 5,800 #DIV/0!
602-000-0000-37240 Sewer Connecton Fee Revenue 63,000 803,000 1,462,000 1,267,620 1,462,000 908,700 -37.85%
602-000-0000-37250 Sewer Connection Fees Regional - - - - - - #DIV/0!
602-000-0000-37260 Sewer Connection Fees Municipal 1,394,920 383,500 466,500 388,480 466,500 345,500 -25.94%
Total Sewer Fund Revenues:1,532,996$ 1,351,605$ 2,180,560$ 1,791,219$ 2,188,661$ 1,605,473$ -26.37%
Sewer Fund Expenses:
Personnel
602-495-9450-41010 Full-time Salaries 37,161 39,678 65,606 21,398 35,222 66,250 0.98%
Safety Clothing Allowance - - - - 123 123 #DIV/0!
602-495-9450-41210 PERA Contributions 3,453 4,270 4,920 1,600 2,650 4,669 -5.10%
602-495-9450-41220 FICA Contributions 2,254 1,987 4,068 1,282 2,185 4,058 -0.25%
602-495-9450-41230 Medicare Contributions 527 464 951 300 510 961 1.05%
602-495-9450-41300 Insurance 6,217 8,352 13,121 5,342 10,345 10,744 -18.12%
Unemployment Insurance - - - - 546 342 #DIV/0!602-495-9450-41510 Workers Compensation 1,663 989 2,625 2,004 3,032 3,274 24.72%
Total Personnel 51,274$ 55,739$ 91,291$ 31,926$ 54,613$ 90,421$ -0.95%
Materials and Supplies
602-495-9450-42270 Repair/Maint. Supplies 1,910 5,873 1,000 1,214 1,500 4,000 300.00%
Office Supplies - - - - - 800 #DIV/0!
Operating Suppies - - - - - 1,000 #DIV/0!
Personal Protective Equipment - - - - - 800 #DIV/0!
602-495-9450-42400 Small Tools & Minor Equipment (984) 2,860 500 2,344 2,800 5,500 1000.00%
Total Materials and Supplies 926$ 8,732$ 1,500$ 3,558$ 4,300$ 12,100$ 706.67%
Charges and Services
602-495-9450-43030 Engineering Services 14,511 - 20,000 4,429 8,000 20,000 0.00%
602-495-9450-43150 Contract Services 3,085 8,059 5,000 32,200 37,000 21,400 328.00%
602-495-9450-43180 Software Support 4,071 4,591 6,000 10,088 18,479 33,533 458.89%
602-495-9450-43210 Telephone 992 1,008 1,500 828 1,200 1,500 0.00%
602-495-9450-43220 Postage - - 1,175 - 1,175 0.00%
602-495-9450-43310 Mileage - - 100 - - -100.00%
602-495-9450-43610 Insurance 185 581 2,000 603 1,000 2,000 0.00%
602-495-9450-43810 Electric Utility 4,621 5,125 5,000 3,985 5,000 5,500 10.00%
602-495-9450-43820 Sewer Utility - Met Council 17,592 16,621 44,514 34,814 44,514 92,140 106.99%
Repairs/Maint. Equip.- - - - - 4,500 #DIV/0!
Equipment Rental - - - - - 1,000 #DIV/0!
602-495-9450-44030 Repairs\Maint Imp Not Bldgs 1,131 1,391 1,200 31,835 33,000 1,200 0.00%
602-495-9450-44370 Conferences & Training 23 80 1,500 3,285 3,600 2,000 33.33%
Total Charges and Services 46,212$ 37,456$ 87,989$ 122,068$ 151,793$ 185,948$ 111.33%
Capital Outlay
602-495-9450-45300 Improvements Other Than Bldgs - - - - 1,289,000 85,000 #DIV/0!
Total Capital Outlay -$ -$ -$ -$ 1,289,000$ 85,000$ #DIV/0!
Miscellaneous and Non-operating
602-495-9450-43320 Depreciation Expense 42,224 132,265 86,561 - - - -100.00%
602-495-9450-44300 Miscellaneous Expenses - 26,036 300 310 310 300 0.00%
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
4
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
602-495-9450-46010 Bond Principal 0 - - 220,000 220,000 275,000 #DIV/0!
602-495-9450-46110 Bond Interest 107,089 116,715 85,337 124,318 124,318 195,324 128.89%
602-495-9450-46250 Fiscal Agent Fees (3,587) 3,707 42,313 - - - -100.00%602-495-9450-47200 Transfer Out - 102,678 - - - - #DIV/0!
Total Misc. and Non-operating 145,726$ 381,401$ 214,511$ 344,628$ 344,628$ 470,624$ 119.39%
Total Sewer Fund Expenses:244,139$ 483,328$ 395,291$ 502,179$ 1,844,335$ 844,092$ 113.54%
Total Sewer Fund Revs. Over/(Under) Expenses:1,288,857$ 868,277$ 1,785,269$ 1,289,039$ 344,326$ 761,381$ -57.35%
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
5
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
603 Storm Water Fund
Storm Water Fund Revenues:
603-000-0000-36100 Special Assessments - - 5,000 - - - -100.00%
603-000-0000-36210 Interest on Investment 2,844 15,933 2,603 - 14,000 7,000 168.92%
603-000-0000-37100 Surface Water Utility Sales 219,127 185,858 282,360 185,598 282,360 283,587 0.43%
603-000-0000-37140 SW Review Fee Revenue - 27,375 29,375 29,350 35,000 29,375 0.00%
Total Storm Water Fund Revenues:221,971$ 229,166$ 319,338$ 214,948$ 331,360$ 319,962$ 0.20%
Storm Water Fund Expenses:
Personnel
603-496-9500-41010 Full-time Salaries 23,599 20,591 36,630 10,174 14,553 34,273 -6.43%
Safety Clothing Allowance - - - - 53 53 #DIV/0!
603-496-9500-41210 PERA Contributions 2,179 2,408 2,747 756 1,091 2,570 -6.44%
603-496-9500-41220 FICA Contributions 1,378 1,129 2,271 602 903 2,099 -7.57%
603-496-9500-41230 Medicare Contributions 322 264 531 141 211 497 -6.40%
603-496-9500-41300 Insurance 8,209 5,856 7,326 5,165 6,887 6,275 -14.35%
Unemployment Insurance - - - - 546 342 #DIV/0!
603-496-9500-41510 Workers' Compensation 221 - 1,465 1,150 1,290 1,361 -7.10%
Total Personnel 35,908$ 30,247$ 50,970$ 17,988$ 25,534$ 47,470$ -6.87%
Materials and Supplies
603-496-9500-42000 Office Supplies 1,933 499 500 247 500 800 60.00%
603-496-9500-42270 Repair/Maint. Maint Supplies 551 3,972 1,000 44 750 2,000 100.00%
Operating Supplies - - - - - 1,000 #DIV/0!
Personal Protective Equipment - - - - - 800 #DIV/0!
603-496-9500-42400 Small Tools & Minor Equipment 200 - 1,000 329 1,000 3,500 250.00%
Total Materials and Supplies 2,685$ 4,471$ 2,500$ 620$ 2,250$ 8,100$ 224.00%
Charges and Services
603-496-9500-43030 Engineering Services 20,332 11,827 20,000 4,875 8,000 20,000 0.00%
603-496-9500-43150 Contract Services 9,941 2,400 10,000 7,270 20,000 17,200 72.00%
603-496-9500-43180 Software Support 3,617 4,067 8,400 5,426 15,140 15,500 84.52%
603-496-9500-43220 Postage 1,500 1,800 1,645 - 700 2,000 21.58%
603-496-9500-43610 Insurance - - 1,500 - 1,500 1,500 0.00%
603-496-9500-44010 Street Sweeping 10,438 10,318 20,000 14,842 18,000 25,000 25.00%
Repairs/Maint Equip - - - - - 1,000 #DIV/0!
603-496-9500-44030 Repairs/Maint Not Bldg - 1,368 3,000 - 2,000 3,000 0.00%
Equipment Rental - - - - - 1,000 #DIV/0!
603-496-9500-44370 Conferences & Training 2,265 2,500 2,500 1,250 1,000 2,500 0.00%
Total Charges and Services 48,094$ 34,280$ 67,045$ 33,662$ 66,340$ 88,700$ 32.30%
Capital Outlay603-496-9500-45300 Improvements Other Than Bldgs - - 20,000 - 20,000 40,000 100.00%
Total Capital Outlay -$ -$ 20,000$ -$ 20,000$ 40,000$ 100.00%
Miscellaneous and Non-operating
603-496-9500-43320 Depreciation Expense 15,963 15,963 85,090 - -100.00%
603-496-9500-44300 Miscellaneous Expenses - 20,577 400 677 1,000 2,000 400.00%
603-496-9500-46010 Bond Principal - - - - - 160,000 #DIV/0!
603-496-9500-46110 Bond Interest - 44,765 62,171 62,171 62,171 58,294 -6.24%
Total Misc. and Non-operating 15,963$ 81,305$ 147,661$ 62,848$ 63,171$ 220,294$ 49.19%
Total Storm Water Fund Expenses:102,649$ 150,303$ 288,176$ 115,119$ 177,295$ 404,563$ 40.39%
CITY OF LAKE ELMO
2018 PROPOSED BUDGETS
Utility Funds - December 5, 2017
6
Adopted 2017 to
2015 2016 2017 2017 2017 2018 Proposed 2018
Account Number Description Actual Actual Adopted YTD - Sept. 30 Projected Proposed Percent Change
Total Storm Water Fund Revs. Over/(Under) Expenses:119,322$ 78,863$ 31,162$ 99,829$ 154,065$ (84,601)$ -371.49%
CITY OF LAKE ELMO WASHINGTON COUNTY STATE OF MINNESOTA RESOLUTION NO. 2017-136 RESOLUTION ADOPTING 2018 WATER, SEWER AND STORM WATER FUND BUDGETS WHEREAS, The City of Lake Elmo is to approve a resolution setting forth an annual budget for the Water, Sewer and Storm Water Funds; and WHEREAS, the City Council has received the budget document; NOW THEREFORE BE IT RESOLVED by the City Council of the City of Lake Elmo, that the 2018 Water, Sewer and Storm Water Fund Budgets shall be as follows:
2018 Water 2018 Sewer 2018 Storm Adopted Adopted Adopted
Fund Revenues: Charges for Services $ 599,769 $ 253,399 $312,962 Connections 1,280,000 1,254,200 -
Special Assessments 111,077 77,874 -
Miscellaneous 87,500 - -
Interest on Investments 20,000 20,000 7,000
Total Fund Revenues $2,098,346 $1,605,473 $319,962
Fund Expenses:
Personnel $ 149,309 $ 90,421 $ 47,470
Materials and Supplies 182,650 12,100 8,100 Charges and Services 352,333 185,947 88,700 Capital Outlay 137,500 85,000 40,000 Miscellaneous 1,013,631 470,624 220,293
Total Fund Expenses $1,835,423 $844,092 $404,563 ADOPTED, by the Lake Elmo City Council on the 5th day of December, 2017.
______________________________ Mike Pearson
Mayor ATTEST: __________________________________
Julie Johnson City Clerk