Agenda Packets - 2022/10/03 - Laserfiche WebLink

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Item No: 3 Meeting Date: October 3, 2022 Type of Business: Work Session Administrator Review: City of Mounds View Staff Report To: Honorable Mayor and City Council From: Mark Beer, Finance Director Item Title/Subject: Review Special Revenue, Debt Service, Capital Projects and Enterprise Funds Draft Budgets for 2023 Attached are the budgets for the Other Funds (Special Revenue, Debt Service, Capital Projects, and Enterprise) for your consideration. The Council has reviewed the General Fund and will again in November or December. The Special Revenue, Debt Service, Capital Projects, and Enterprise funds have not been reviewed. Enterprise Funds The City has and will continue to perform long term capital maintenance on the various utility systems. Many of the systems are aging and have received or will need attention in the next few years. This has driven the need for rate increases. Staff is recommending that the base charge increase by $1 per quarter per connection. Variable rates would increase by a dime for the lowest tier and slightly more for higher tiers in 2023. Water line repair insurance would not increase for 2023 and is currently $8.00 per quarter. Overall water rates would increase $0.95 per month or $11.44 annually. Future base charges would increase by smaller amounts until the base charge is approximately 65% of revenue. This may mean that variable rates won’t increase for several years but the base rate will. The City is implementing major improvements to the water treatment plants and well control equipment and should finish in 2024. New smart water meters will be installed in 2023/24 which will improve services and accuracy. The Sewer fund anticipates a 4% increase in user charges which will add $1.33 per month or $15.99 annually to a residential utility bill. Met Council Environmental Services (MCES) waste charges increased by 5.89% for 2023 Future increases of 4% for 2024, and 3.5% for 2025 will help stabilize the sewer fund. The Storm Water fund will have a proposed $1 per quarter or $4 per year increase in 2023. This will continue to build reserves to finance the deferred maintenance on the storm water system. The City will be slip lining some of the storm sewers to extend their lives in the coming years and that could impact future rates also. The Street Light Fund will have no increase in 2023. Total utility charges will increase by $2.62 per month or $31.43 for the full year. Capital Projects Funds There are a number of capital projects that are anticipated to occur in 2023 the most prominent is reconstruction of Pleasant View road and Spring Lake road which will occur over 2 years. There are small projects for City Hall and the Community Center conference room, hardening of the dais, and front counter and other miscellaneous improvements. There is a $75,000 transfer budgeted in the General Fund for 2023 to the Special Projects Fund.