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October 22, 2024 St. Anthony Council Work Session - 4 <br />o Properly discharge sanitary sewer flows <br />o Appropriately control and treat stormwater runoff <br />Water Rates <br />As part of the annual rate adjustment process the water production and distribution costs are <br />categorized as fixed in nature or usage driven. The 2025 budgeted water costs are comprised of <br />$875,593 in fixed costs and $1,038,888 in usage driven costs. Exhibit A was shown to the City Council. <br />The Multiyear approach to water rates included the phase in of the flat fee which began in 2016. Based <br />on estimated results for 2024 and 2025 budgeted costs are reflected in the proposed rates for 2025. Ms. <br />Maloney reviewed the 2025 proposed water rates and the recommendations impact on 2025 quarterly <br />Water bills. <br />Sewer Rates <br />As part of the annual rate adjustment process the sewer treatment and collection system costs are <br />categorized as fixed in nature or flow volume driven. The 2025 budgeted sewer costs are comprised of <br />$584,010 in fixed costs and $995,456 in flow volume driven costs (usage). The Multiyear approach to <br />sewer rates also included the phase in of the flat fee. Based on estimated actual results for 2024 and <br />2025 budgeted costs are reflected in the proposed rates for 2025. The proposed 2025 sewer rates are <br />projected to produce $1,589,785 in revenues in 2025. At this level of revenues, the operating income <br />before depreciation is budgeted to be $109,191. The sewer budget was provided to the City Council in <br />Exhibit D. <br />Stormwater Rates <br />A multi-year approach to Stormwater rates in place since 2012 called for an annual increase for single <br />family residential (classifications 2 & 3) to bring the rates in line with surrounding communities and <br />minimal increases moving forward to sufficiently fund future costs of the stormwater utility. Staff’s <br />proposal for 2025 is a $.75 increase in single family stormwater charge. The proposed rate amount is <br />comparable to the range of surveyed rates shown on Exhibit E which was provided for Council review. <br />Single-family rate increases are determined based on cost drivers, projected project needs and overall <br />fund balance. <br />The City’s commercial stormwater rates, however, are below the rates charged for high density and <br />commercial/industrial/institution classifications. It was noted in the 2023 rate survey that the City’s <br />commercial rates were 3-4 times the single-family rate. The surveyed 2023 rates for these classifications <br />were 7-12.5 times the single-family rates. Staff is proposing to phase in an increase for the high density <br />and commercial/industrial/institution rates. Employing the same multi-year approach as used for past <br />single-family rates increases. This approach results in the fixed amount increase reflected in the chart <br />provided. These additional charges will aid in supplementing the funding for future street reconstruction <br />and major stormwater improvements in the industrial and retail districts as they are redeveloped. <br />A chart showing the proposed 2025 Stormwater quarterly rate increases by land use categories was <br />reviewed in detail. <br />Ms. Maloney reviewed a long-range Utility revenue plan which addresses a strategic plan goal to <br />develop long term revenue planning. The rates are being managed to begin supporting capital needs of <br />the water and sewer operations. The current plan projects that support will begin in 2025 with a <br />transfer to the Utilities Infrastructure fund.