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19 <br />TO: <br />MARK CASEY, CITY MANAGER <br />FROM: <br />SHELLY RUECKERT, FINANCE DIRECTOR <br />SUBJECT: <br />2014 UTILITY RATES <br />DATE: <br />OCTOBER 14, 2013 <br />2014 Utility Rate Synopsis: <br />The utility rates recommended herein for 2014 reflects a multi-year approach towards <br />rate adjustments that began in 2012. The concept will allow for reasonable rate <br />adjustments that maintain an equitable sharing of costs, encourages conservation, and <br />retires debt. The approach and rates will be evaluated annually. <br />The overall impact of the recommended rates for a residential customer at each of the <br />five tier level ranges from 4.44% to 4.91% as detailed below: <br />Tier Level <br />1st -7,500 <br />2nd -15,000 <br />3rd -22,500 <br />4th -30,000 <br />5th -37,500 <br />Distribution <br />29.4% <br />46.2% <br />18.6% <br />4.1% <br />1.7% <br />2014 Cost <br />2013 Cost <br />67.12 <br />(64.27) <br />119.67 <br />(114.29) <br />174.49 <br />(166.49) <br />233.02 <br />(222.22) <br />298.76 <br />(284.84) <br />Quarterly <br />Annual <br />2.83 <br />11.30 <br />5.38 <br />21.50 <br />8.00 <br />32.00 <br />10.81 <br />43.23 <br />13.92 <br />55.70 <br />Percent <br />Increase <br />4.44% <br />4.73% <br />4.84% <br />4.89% <br />4.91% <br />Water Rates: <br />The April 2012 water rate discussion resulted in the multi- year approach cited <br />previously. Consistent with this approach, the elimination of annual transfer from the <br />water operations to the general fund is carried forward to 2014. The recommended 2014 <br />rate per 1,000 gallons is $2.87, or a twelve cent increase. This represents a 4.5% increase <br />in rate and would be expected to generate $39,001 in additional revenues (assuming <br />water usage is similar to 2013). The impact on a 7,500 gallon per quarter user would be <br />as follows: <br />