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<br /> <br /> <br />Dave Perrault <br />Proposal for Utility Rate Study and Development Fee Analysis <br />Page 2 <br /> <br /> <br />Step 3: Determine Annual Cost <br />We will quantify the annual cost of debt service, assuming 15-year bonds are issued to finance the <br />improvements. <br /> <br />Step 4: Review options for development fees with the staff and Council and solicit <br />feedback <br />Ehlers will guide staff and Council through the options to solicit conceptual feedback and <br />preferences on the fee options. <br /> <br />Step 5: Prepare a Cashflow Projection for Water, Storm Water, and Sanitary Sewer <br />This step entails developing a cashflow projection model for each utility. The projection will <br />evaluate the costs associated with each capital improvement, and identify the revenues or financing <br />needed in each of the next fifteen years. By quantifying the revenue targets we need to hit, we can <br />develop fee stru ctures that provide the optimal cashflow to the City. The cashflow projection will be <br />a working document that allows us to answer “what if” questions. What if the land develops <br />differently than the Master Plan? What if development occurs more slowly than anticipated? What <br />if it never occurs? <br /> <br />Step 6: Develop a fee structure that will fully recover the City’s costs over 15 years <br />Ehlers will make a recommendation for development related fees and quarterly utility fees that will <br />ensure the City fully recover s its costs for installing the water tower, water booster station and lift <br />station in TCAAP. <br /> <br />Step 7: Evaluate the City’s financial risk <br />The Development Fee study will include a sensitivity analysis to show the annual risk to the City of <br />development occurs more slowly or with less density than anticipated. <br /> <br />Step 8: Provide a comparison of fees in comparable communities <br />The survey will compare development charges and utility fees for a newly constructed housing unit <br />in Arden Hills with fees charged by comparable communities. <br /> <br />Development Fee Study Deliverables <br /> Four meetings with staff <br /> Two meetings with the City Council <br /> Financial projections, provided in PDF format <br /> Development fee recommendations <br /> Utility fee (connection and on-going user fee) recommendations <br /> Power point presentation(s) <br /> Comparison of fees <br /> <br />