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d <br /> • Fe--nary 5 , 1988 <br /> To: Members of the City Council <br /> From: David M. Childs , City Manager <br /> Re: Water and Sewer Rates <br /> As stated in the 1988 Budget , both the water and sewer rates for <br /> the City of St. Anthony must be increased in 1988 . The budget <br /> assumes that any Ordinance increasing rates would have its third <br /> reading and be published prior to April 1 , 1988 . <br /> Water : This fund showed a net loss in 1986 mainly due to <br /> watermain reconstruction projects . It is estimated that 1987 <br /> will have an operating loss of over $30 , 000 when costs relating <br /> to the water contamination litigation and studies are factored <br /> in. In 1988 there will be an additional loss even without <br /> factoring in the $30 , 000 line item added to the budget to cover <br /> litigation costs . <br /> Past increases are as follows : In 1982 the rates were increased <br /> from $ . 33 per 100 cubic feet ( ccf ) to $ . 40 per ccf . In 1984 the <br /> rates were increased to $ . 45 per ccf . In 1986 the rates were <br /> • increased to $ . 60 per ccf. <br /> RECOMMENDATION: The rates must be increased to $ . 75 per ccf and <br /> the City Council would have to authorize reserve funds to be used <br /> to fund our litigation efforts merely to allow the Water Fund to <br /> break even for 1988 . I recommend adoption of the first reading <br /> of 1988-003 with the Council considering a resolution at the next <br /> City Council meeting which would fund all future and possibly all <br /> past expenditures for litigation and associated studies from the <br /> General Reserve Fund. If such a transfer is not made, water <br /> rates would have to be raised to $ . 85 per ccf . <br /> Sewer: Tile Sanitary Sewer Fund broke even in 1986 but is <br /> expected to show a small loss for 1987 . Based on an Ordinance <br /> adopted in 1984 sewer rates have increased automatically in 1988 <br /> by 5 . 12 per ccf due to the amount of service charges from <br /> M.W. C. C . . This will allow the fund to come very close to a break <br /> even point , with the exception that the funding for the Foss Road <br /> Lift Station Reconstruction Project ( about $200 , 000 ) is not <br /> factored into the budget. The annual debt service for a 10 year <br /> bond for the project would be a little under $40 , 000. An <br /> additional increase of $ . 10 per ccf would be necessary to cover <br /> this cost . <br /> IDSewer rates were increased in 1980 and in 1984 they were <br /> increased to $1 . 10 per ccf . In January of 1988 the rates <br />