2019.11.04 CC Packet - Laserfiche WebLink

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U.y r CITY OF or EST. 1506 14669 Fitzgerald Avenue North, Hugo, MN55038 • (651) 762-6300 • www.ci.hugo.mn.us TO: Honorable Mayor Tom Weidt and Members of the City Council FROM: Ron Otkin, Finance Director SUBJECT: 2020 Water and Sewer Service Rates DATE: For the City Council Meeting of November 4, 2019 DESIRED COUNCIL ACTION Adoption of Resolution Approving a Pro Forma Financial Guide for Water and Sanitary Sewer Operations for the 2020 Fiscal Year and Establishing Service Rates. BRIEF HISTORY Over the last two years the Finance Department has prepared the water and sewer rate schedules rather than outsourcing the task to a consulting firm. The Finance Department spent a considerable amount of hours collecting, organizing, and analyzing water usage information. With the help of Billing Clerk Jodie Guareschi and Finance Coordinator Anna Wobse, staff is ready to recommend water and sanitary sewer rates for the 2020 fiscal year. PRO FORMA FINANCIAL GUIDE In order to develop service rates staff developed a pro forma financial guide (basically a budget) for the water and sewer departments. Staff feels that the spending items identified in the guide reflect the true and actual expenses for the services being provided. Funds for large repair items (such as pump repairs, water main breaks, lift station rebuilds) have been identified separately. The water budget includes funds to continue the radio read meter change out program. Funds have also been allocated for the purchase of smart irrigation system controllers that could be sold at a discount to property owners to help them manage outdoor water use more efficiently. Staff is hoping that grant funds will be awarded by the Met Council that could kick-start this program. The wages portion of the water and sewer operating budget includes two full-time maintenance workers and a portion of the accounting clerk/administrative assistant position. This clerical position contends with the paperwork and increasing number of a -mails and phone calls and has certainly freed up the public works director's time to attend to more pressing matters. RAINFAI_I Mother Nature dropped 19.40 inches of rain during the peak outdoor usage period (June thru September) in 2019, compared with 17.91 during the same period in 2018. The average rainfall for this period is 15.67 inches.