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I% 18 19 20 21 22 23 Department Approval e,44 'e. /4-e4 qASEN+L�hE REQUEST FOR COUNCIL ACTION Date: 12/2/13 Item No.: 13.a City Manager Approval Item Description: Consider Adopting the 2014 Utility Rate Adjustments BACKGROUND Over the past several months, City Staff has been reviewing the City's utilities operations to determine whether customer rate adjustments are necessary for 2014. The analysis included a review of the City's water, sanitary sewer, storm drainage, and curbside recycling operations. It also incorporates the recommendations provided by the Council- appointed Capital Improvement Plan (CIP) Task Force, and the Public Works, Environment, and Transportation Commission (PWET). Staff's analysis included a review of the following: ❖ Fixed costs including personnel, supplies and maintenance, and depreciation. ❖ Variable costs including the purchase of water from the City of St. Paul, water treatment costs paid to the Metropolitan Council, and recycling contractor costs. ❖ Capital replacement costs. ❖ Customer counts and consumption patterns, rate structure, and rates. A financial overview of each operating division is included beginning on the next page. The estimated overall impact on a typical single- family home is shown in the following table. Single Family Homes Service Water - base fee Water - usage fee Sanitary Sewer - base fee Sanitary Sewer - usage fee Storm Sewer Recycling Total per Quarter 2013 2014 $ Increase % Increase 49.50 54.45 4.95 38.70 39.60 0.90 37.35 37.35 - 21.75 24.00 2.25 11.15 11.70 0.55 6.00 5.00 (1.00) $ 164.45 $ 172.10 $ 7.65 4.65% Avg. Water consumption (1,000 gals.) 18 Avg. Sewer consumption (1,000 gals.) 15 As shown in the chart, for 2014 a typical single - family home will pay $172.10 per quarter, or $57.37 per month. This is an increase of $2.55 per month from 2013. Comparisons to peer communities are shown in a separate section below. Page 1 of 10