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ARDEN HILLS SPECIAL CITY COUNCIL WORK SESSION — AUGUST 19, 2024 10 Mayor Grant added these increases are based off rates, with the exception of the increases from Met Council. Finance Director Yang confirmed. Councilmember Monson asked if the 9% is just a one-time increase. She asked what happens to the fund if we were to do 5% or 8%. Finance Director Yang said she looked at 5% for the next three years. We would have a deficit for the next three years. She proposed the 9% to avoid the deficit. Councilmember Monson said going to 9% to ensure that the fund is equal to what is being spent is important. She would prefer to increase the subsequent years' rates to 4% to ensure that the money is available. Councilmember Holden asked about the surface water funding and wondered when the ponds will be dredged. Public Works Director/City Engineer Swearingen said he has all the dredging projects programmed in the C I P. They should be accounted for in these figures. Councilmember Holden asked if we are still in the positive. She thought it looked like in 2027 there is $800,000. Finance Director Yang confirmed. Mayor Grant outlined that the water meter replacement was included in the water fund. In 2029, there would still be $1.6 million. Finance Director Yang confirmed. Councilmember Holden supports keeping the water fund and the surface water fund at 3%. Then next year all three funds could be 4%. She clarified this year the sanitary sewer would be 9%, because that's what's being charged. Councilmember Monson noted that the size of the water fund and knowing that includes the spend on the large water meter project, she asked is there a reason there is so much money in the water fund. Public Works Director/City Engineer Swearingen said the water meter replacement will be around $1.5 million, programed for 2025 and 2026. Councilmember Monson stated it looks like we have $2 million. Councilmember Holden said it is because we have been planning for projects. We were reimbursed by the legislature over $2 million on water projects so we haven't had to spend that money. Councilmember Monson wondered if there was a more efficient way to use the money rather than just letting it sit in the water fund. Could those funds be moved to the sanitary sewer fund? Mayor Grant stated this is an enterprise fund. So he would not support trying to put it someplace else. Councilmember Monson thought this is a lot of money for us to just sit on.