The URL can be used to link to this page

Home My WebLink About09-11-2012 Agenda J Chair James Ostlund (2014) 1245 W. Highway 96 Committee Members Arden Hills, MN 55112 Arlene Mitchell (2013) �,R�EN,HILLS 651.792.7800 John Braun (2012) www.ci.arden-hills.mn.us Katy Peters (2012) Arden Hills David Radziej (2013) (2014) Financial Planning and Council Liaison David Grant Analysis Committee September 11 , 2012 City Vision A strong community that values its unique environmental setting, strong residential neighborhoods, vital business community, well-maintained infrastructure, fiscal soundness, and our long-standing tradition as a desirable City in which to live, work, and play. Agenda Regular Committee Meeting Convenes 6:00 PM Call to Order 1. APPROVAL OF THE AGENDA 2. MINUTES A. June 19, 2012 —Regular Meeting 3. UNFINISHED AND NEW BUSINESS A. Discussion of Utility Rate Study 4. REPORTS A. Report from the City Council B. Financial Planning and Analysis Committee Comments and Requests 5. ADJOURNMENT A quorum of the City Council may be present at this meeting. • • DEN HILLS MEMORANDUM DATE: September 11,2012 TO: Financial Planning and Analysis Committee FROM: Sue Iverson, Director of Finance and Administrative Services SUBJECT: Discussion on Utility Rate Study At our June meeting, it was decided that we would need to be flexible in our scheduling as we were going to work on the Utility Rate Study for our Water, Sanitary Sewer, and Surface Water Management Funds. • Staff has been able to gather enough data with the help of our new intern Ian Jackson to be able to keep our September meeting date. Staff has compiled figures for usage of all our customers, 20-year estimates on infrastructure costs for the systems, and the preliminary operating budgets. This will give us enough information to run scenarios for the group,as we also have an updated financial forecasting model that will demonstrate these for us. Staff will demonstrate how the model works and will then ask for direction from the committee on what types of scenarios you would like to see run. Once we have received direction from the committee, staff will program in the scenarios and we will have another meeting to show you how these different scenarios affect revenues,fund balance, and where we would need to adjust the rates based on each case. We have included some information on new legislation which allows cities to still meet the conservation criteria that was set a few years back, (which our current system was built on) but allows alternatives to what was allowed before. The committee might want to discuss this as we look at what types of scenarios you want to see. Once staff has received this feedback, we will evaluate what we expect our timeline to be and we can talk about scheduling our next meeting. Our goal is to present a recommendation from the committee to the City Council at its November worksession. i MINUTES - R�DEN HILLS • FINANCIAL PLANNING&ANALYSIS COMMITTEE Tuesday,June 19,2012 6:00 P.M. Council Chambers,Arden Hills City Hall CALL MEETING TO ORDER AND ROLL CALL The meeting was called to order by Jim Ostlund at 6:00 pm. MEMBERS PRESENT:Jim Ostlund,Arlene Mitchell,Katy Peters,David Radziej,David Grant;Council Liaison MEMBERS NOT PRESENT:John Braun OTHERS PRESENT: Sue Iverson,Kyle Howard Call to Order 1. APPROVAL OF THE AGENDA Motioned:Arlene Mitchell Seconded:Katy Peters 2. APPROVAL OF December 13,2011,MINUTES Motioned:Arlene Mitchell Seconded:Katy Peters 3. UNFINISHED AND NEW BUSINESS A. Survey Results • Sue Iverson discussed the background of the CIPFA-GFOA Financial Management model. She then explained that"Financial Management is the system the by which the fmancial aspects of a public body's business are directed and controlled to support the delivery of the organization's goals."She explained how the survey can be tailored specifically to different groups through the questions selected from the model.The model would then return results specific to the targeted group that could then be analyzed.Sue shared the results of the FPAC and Management team's surveys,giving examples on how the information can be used. B. 2012 Work Plan The upcoming water rate study was presented to the committee.Mayor Grant explained why a rate study is needed and that he would like to receive input from FPAC on the study.It was stated that Staff would gather the historical water usage data by the September meeting.By the middle of September Staff would also have the estimated fixed cost and capital improvements for 2013. The meeting schedule was discusses,additional meetings may be necessary in October and November to complete the rate study. 4. REPORTS A. Reports from the City Council Mayor Grant informed the committee on current events taking place in the city.The City is working with the County on options for the TCAAP property.Walgreens is moving forward and on schedule.The Council has received a proposal for the Holiday Inn site from the owner.Pulte Homes have now sold a total of 26 units. • City of Arden Hills 1245 West Highway 96•Arden Hills Minnesota 55112 Phone 651.792.7800•Fax 651.634.5137 www.ci.arden-hills.mn.us MINUTES 2kRZE__IHILLS • 5. ADJOURNMENT Motioned:Jim Ostlund at 7:30 pm. Seconded:David Radziej Jim Ostlund,Chair Susan K.Iverson,Finance Director • • City of Arden Hills 1245 West Highway 96•Arden Hills Minnesota 55112 Phone 651.792.7800•Fax 651.634.5137 www.ci.arden-hills.nm.us Focus on New Laws: Water Conservation Rate Requirements Page 1 of 2 • LEAGUE of MINNESOTA CITIES Focus on New Laws: Water Conservation Rate Requirements Cities now have options for meeting state water conservation mandates. (Published Sep 6, 2012) Many cities provide an essential ingredient: clean water. They now have more ways to demonstrate careful use of it. 2 e Chapter 150(Link to:https://www.revisor.mn.gov/laws/.td_I50&doctype_Chapter&year=201 &typ =0) SF 1567) made amendments to Minnesota Statutes, section 103G.291, subdivisions 3 and 4(Link to: https://www.revisor.,nn.govistatutes/?id=103G.291)to allow cities to set uniform rates, where each gallon costs the same, but show how they conserve water by decreasing demand for it. Conserving water is the goal. Previous law required that by January 2013, large public water suppliers use a"conservation rate structure"as the only way to achieve conservation. Under the conservation rate structure,the more water you use compared to others in your class of customer,the more you pay for each gallon. To make this a little more fun,think of buying a Twins baseball ticket. Even during a less than stellar season,you pay quite a bit extra for the best seats in the house because they're in a certain block of 41) seats. Under conservation rate structures, a city may charge those who use large amounts of water more for each gallon because they are in that tier of extensive water usage. However, for some users of city water,that rate structure change sent their water charges soaring. As a result, instead of saving water, as the law intended, some users were considering drilling their own wells and using even more water.Legislative efforts were made to both repeal city authority to prevent private well drilling and to get rid of conservation rate structure completely. Instead of eliminating a law that that many communities wanted to preserve and that has a laudable goal—to conserve water—the League worked to build flexibility into the requirement. The amended law removes the mandate that public water suppliers serving 1,000 or more people use conservation rate structures by January 2013. Instead, it allows city water systems to show how they are reducing demand for water even if the city still uses a uniform rate structure. The deadline to have these water demand reduction efforts in place is now moved back to Jan. 1,2015. Each water system may now develop ways to reduce demand, known as demand reduction measures, showing just that—reduced water usage. Water systems may do all this as part of each system's water supply plan review process. Cities may still use the previous conservation rate structure,too, if that is preferred in their situation. Demand reduction measures means measures that reduce water demand, water losses,peak water demands, and nonessential water uses. A"conservation rate structure"means a rate structure that encourages conservation and may include increasing block rates, seasonal rates,time of use rates, • individualized goal rates, or excess use rates. http://www.lmc.org/page/l/fonl-waterconservation.j sp?utm_source=Sept.+6%2C+2012&ut... 9/6/2012 Focus on New Laws: Water Conservation Rate Requirements Page 2 of 2 The 2015 deadline also applies to the metropolitan area systems that were previously required to have conservation rate structures in place by 2010, but have yet to comply. As an aside, the amended law also clarifies how conservation rates apply to multi-family dwellings; if a conservation rate is applied to multi-family dwellings,the rate structure must consider each residential unit as an individual user. Read the current issue of the Cities Bulletin(Link to:http://www.lmc.org/page/l/cities-bulletin-newsletterjsp) Your LMC Resource Jeanette Behr Research Manager (651) 281-1228 or(800) 925-1122 jbehr@lmc.org(Link to:mailto.jbehr@lmc.org) Contact Craig Johnson IGR Representative (651) 281-1259 or(800) 925-1122 cjohnson@Imc.org(Link to:mailto:cjohnson@lmc.org) Copyright 02012 League of Minnesota Cities,145 University Ave.W,Saint Paul,MN 55103-2044 I Phone:(651)281-1200 I Toll-Free:(800)925-1122 • • http://www.lmc.org/page/1/fonl-waterconservation.j sp?utm_source=Sept.+6%2C+20 1 2&ut... 9/6/2012