HomeMy WebLinkAbout20090406 - VIII-A-3
MEMO
To:
Honorable Mayor and City Council
From:
Tom Montgomery
Date:
March 31, 2009
Re:
Annual Utility Rate Review
-
WR
CR: $1.65/1,000GBR
ATER ATES
URRENT ATE ALLONS ASE ATE
$2.05/1,000GS
ALLONS URCHARGE
ROW
ATE VER INTER
QU
UARTER SAGE
R: NC
ECOMMENDEDO HANGE
No rate increase is recommended for water rates. The 2008 year end Water Fund balance
did show a $60,000 loss, and the projected 2009 fund balance is estimated to show a
$100,000 loss. However, the Water Fund has a healthy reserve, and water revenues
fluctuate from year to year, based primarily on summer water usage. If the Water Fund
runs a deficit again in 2009, a rate increase may be appropriate for 2010.
-
WR
CR: $2.95/1,000G
ASTEWATER ATES
URRENT ATE ALLONS
R
$3.05/1,000G
ECOMMENDED
ALLONS
I am recommending a $0.10 per 1,000 gallon increase in wastewater rates to $3.05 per
1,000 gallons. This increase should provide nominal funding to begin rebuilding the
wastewater fund's reserve/fund balance above $1,000,000. The next two years of street
reconstruction projects should not include much in the way of sewer replacement,
hopefully allowing the sewer fund to rebuild for future replacements in the next three to
five years.
WAC,SAC,&ISC
NTERCEPTOR EWER HARGES
Council adopted a resolution in 1993 that updated utility connection fees and
indexed these fees to the American City and County magazine construction cost index.
This index increased 5.6% last year. Accordingly, staff is recommending increasing the
connection fees as shown below. These connection fees are charged to new development
to fund expansions of the City’s sewer and water system that are needed to support new
development. Examples of system expansion included new wells, water storage, and
trunk sewer and water mains.
Recommended
ChargesCurrent Rate
Rate
WAC $2,605 $2,750
City SAC $795 $840
Interceptor Sewer $410 $435
CAR
OUNCIL CTION EQUESTED
Council is requested to adopt the enclosed resolution that would:
?
Increase the wastewater rate to $3.05/1,000 gallons
?
increase WAC charge to $2,750
?
increase SAC charge to $840
?
increase Interceptor Sewer charge to $435
If adopted, the WAC, City SAC, and Interceptor Sewer Charge increases would
go into effect immediately for all new permit applications and final plat approvals. The
water and wastewater rate increases would be implemented with the May billing.
CITY OF HASTINGS
Dakota County, Minnesota
Resolution No.
RIWCR,WA
ESOLUTION NCREASING THE ASTEWATER OMMODITY ATE THE ATER CCESS
C,CSAC,ISC
HARGE THE ITY EWER CCESS HARGE AND THE NTERCEPTOR EWER HARGE
WHEREAS, the City of Hastings presently owns and operates the municipal water system and
the sanitary sewer collection system and sells this service to industrial, commercial, and
residential consumers, and
WHEREAS, the City of Hastings has completed an analysis of the charges of providing said
services, and
WHEREAS, the City of Hastings has determined that it is necessary to increase the cost of said
services to prevent the City utilities from operating at a loss.
NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
HASTINGS AS FOLLOWS;
1.The existing wastewater commodity rate of $2.95/1,000 gallons shall be increased to
$3.05/1,000 gallons effective with the May 2009 billing.
2.The existing Water Access Charge (WAC) shall be increased from $2, 605 to $2,750 effective
upon the adoption of this resolution.
3.The existing City Sewer Access Charge (SAC) shall be increased from $795 to $840 effective
upon the adoption of this resolution.
4.The existing Interceptor Sewer Charge shall be increased from $410 to $435 effective upon
the adoption of this resolution.
ADOPTED BY THE CITY COUNCIL OF HASTINGS, MINNESOTA, THIS 6 DAY OF
th
APRIL, 2009.
Ayes:
Nays:
Paul J. Hicks, Mayor
ATTEST:
(Seal)
Melanie Mesko Lee, City Clerk