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2017 Annual Report • Finance Department • St. Anthony Village, Minnesota <br /> <br /> <br /> <br />17 <br /> <br />V. Long Term Financial Management <br />ESTABLISHED A LONG TERM PLAN FOR WATER & SEWER RATES <br />The new long term rate plan addresses a 2017 strategic plan goal to develop long term revenue <br />planning. The water and sewer rates are modeled to begin supporting capital needs of the water <br />and sewer operations in 2022. At that point funds will be transferred to Utilities Infrastructure <br />fund. <br />The plan includes assumptions regarding future City costs <br />and MCES treatment costs. It also factors in the retirement <br />of water /sewer bonds occurring in 2024. A minimum cash <br />balance was established to recognize that the quarterly <br />billing and collection process is recovering 90-120 days of <br />prior cash outlays. No growth in accounts or usage was <br />factored in the projection. Real growth will be noted <br />annually through the process of updating the base year <br />results. With these factors in place the phase-in of the flat fee and usage rate adjustments were <br />determined. Staff believes the model will help guide year to year rate increases while being <br />flexible enough to keep the annual increases reasonable for utility customers.