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23 MEMORANDUM DATE: Oeto4er 16, 2009 TO: Mayor and Couneilmombers FROM: Mike Mornson, City Manager Roger Larson, Finance Director ITEM: TZ P" WATER RATES Overview; Mimresota Statutes, section 103G.291 was amended to include a requirement for public water suppliers serving more than 1,000 people to adopt a water rate structure that encourages conservation, To comply with the law, effective 01/01/2010, Cities must implement a tiored systom of water rates that charges a higher rate per unit as wader usage increases The conservation rates are for all user groups including residential, multi -family and commercial users of water, Currently, St. Anthony has a uniform rate structure where the cost per unit ($2.60 per 1,000 gallons) is the same regardless of the volume used, An example of residential tiered water rates would be as follows, 0 — 7,500* Gallons 7,500 —15,000 Gallons 15,000 — 22,500 Gallons. 22,500 — 30,000 Gallons Over 30;000 Gallons *Minimum bill = $7,500 Gallons Meetings to Date: $2,60 per 1,000 Gallons $2.73 per 1,000 — 5% increase $3.00 per 1,000 --10% increase $3.45 per 1,000 15% increase $4.32 per 1,000 — 25% increase The City Council and Staff reviewed tiered water rates at their June l't and August 3" work sessions. In addition, a presentation and discussion occurred at the August 25" and October 130' regular Council Meetings, The City Council has expressed the need to impact all user groups equally, To accomplish this goal, City Staff developed the following criteria: 1) Same base rate of $2,60 per 1,000 for all User Groups, 2) Same percentage increase structure for all User Groups, 3) Each User Group will have its own tier structure. At the October IP meeting, the City Council directed staff to include a S°/n tier and change the last tier from a 20% to Zft