2016-11-29_PWETC_AgendaPacket - Laserfiche WebLink

Home

80 At the request of Chair Cihacek, Finance Director Miller reviewed the use of 81 reserves in each utility infrastructure fund, as isolated and segregated to ensure 82 transparency and for management purposes. Mr. Miller advised that some outside 83 restrictions applied to these cash reserves, thus their segregation not only for the 84 water and sewer utilities, but in other areas of government accounting. Depending 85 on infrastructure replacement cycles, Mr. Miller advised those cash reserves could 86 spike or diminish from year to year depending on that schedule. 87 88 Finance Director Miller reviewed each fund, responding to questions and 89 comments of the PWETC. 90 91 Water Operations (Attachment A, page 2) 92 Chair Cihacek pointed out an apparent error in the 2°d table (water operations) 93 between lines 34 — 38 (Revenues, Interest Earnings) showing "zero percent" 94 increase or decrease in 2017, when an increase is actually projected based on 95 anticipated increases in those interest earnings. Finance Director Miller thanked 96 Chair Cihacek for pointing that error out. 97 98 Sanitary Sewer Operations (Attachment A, page 3) 99 Finance Director Miller reported that the Metropolitan Council is undertaking 100 significant infrastructure replacement on their trunk line, running through 101 Roseville, and would be passing on those capital improvement costs on to their 102 customers. However, Mr. Miller noted this large percentage increase should be 103 balanced by smaller increases in water and storm sewer utility costs for customers. 104 105 At the request of Chair Cihacek, Mr. Miller advised that staff was usually able to 106 balance rates to present steep spikes such as in this utility fund for 2017, but 107 admitted this huge increase from the Metropolitan Council had caught staff by 108 surprise even with the continued monitoring. Mr. Miller noted that Roseville water 109 flows had been dropping over the years, but not to any significant amount; and 110 compared to other cities, Roseville was taking a bigger hit than those other cities 111 resulting in opposite course corrections in the past. Over the long-term, Mr. Miller 112 reported the rate increases realized by Roseville from the Metropolitan Council had 113 been much closer to inflationary impacts; but reiterated this one stood out as an 114 anomaly. 115 116 At the request of Member Seigler, Finance Director Miller confirmed that the City 117 of Roseville was tied to using the Metropolitan Council's services versus being able 118 to revert to private septic systems or other options such as building its own wells. 119 120 Specific to water, given economies of scale with St. Paul, Mr. Miller clarified that 121 the City of Roseville could not replicate that service, upon investigation several 122 years ago. Mr. Miller further clarified that with the contractual relationship in 123 place, St. Paul costs didn't bleed over into the broader system and other 124 communities purchasing water from the (SPRWS) with aformula in place and only 125 shared equipment costs captured based on a proportionate share, and nothing more. Page 3 of 20