Agenda Packets - 2023/05/08 - Laserfiche WebLink

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Vehicle and Equipment Replacement Plan The schedule has been updated to reflect retirements, new acquisitions, increased replacement costs, and changes to expected useful lives. The current amounts transferred to the Vehicle and Equipment Fund from the participating funds will need to increase to eliminate an underfunded condition Impact on Capital Projects Funds' Cash Balances: This presents the sources and uses and impacts to cash for the Capital Improvement Program on the four capital projects funds for the current year and the five year period of this report, 2024 thru 2028. The Park Dedication Capital Project fund will be in a deficit position thus will not be able to support any park capital projects. Utility Rate Studies Rate studies are included for the utility funds. (Water, sewer, storm water, street light) All four funds should be considered for an increase in 2024. Inflation has greatly increased the operating cost for all four. The water base rate is proposed to increase by $2 in 2024 and the variable rate is proposed to increase by $.15, which will increase water charges by $1.60 per month or $19.16 a year to the average bill. The sewer rate is proposed to increase by 7% in 2024, which will add $2.43 per month or $29.10 a year to the average residential bill. The need for an increase in both the water and sewer funds is generated by significant capital expenses from deferred maintenance and increases in disposal charges by Metropolitan Council Environmental Services for the current and previous years. Future increases will need to be considered until both funds stabilize. The storm water rate should be considered for a $1 per quarter increase to begin preparing for significant maintenance that has been deferred which will include work on Silver View Pond. The City had a City-wide storm water assessment performed which highlighted a number of projects that will have to be considered to improve and remediate long standing conditions that affected the entire system. The street light rate is proposed to increase $0.50 per quarter or $2 for the year. Electric rates saw a significant increase in 2022. Water service repair insurance is currently $7.50 but should be increased to $8.50 per quarter. We will need to monitor this for future increases. There have been significant increases in repairs that have occurred over the last five years. Five Year Financial Plan Adoption: The Five Year Plan is a blueprint for future years and is only one possible scenario. It is intended to be changed as priorities change and more current information becomes available. Staff welcomes Council comments and direction on any desired changes. Once adopted the five year financial plan will be published on the City's website. Respectfully Submitted, Mt2r�Z Peer Mark Beer, Finance Director