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Senator John Marty February 23, 2Q09 Mayor Klausing and Roseville City Council 2660 Civ'rc Center Dri�e Rose�ille, MN 55113 RE: New Utility Billing Form�la Dear Mayor Klausing and City Council Members: Attachment D. _' "1 . ' :� State of Minnesota. A recent lef#er to Roseville residents included with water bifls mentions a state environmental law requiring municipalities across Minnesota to promote water conser�ation thraugh rate struct�re and uses this law as justification for' the new rate structure chosen by the city. Hawe�er, the changa in rates move the city furfher away frorr� a conser�atian-bas�d system than the ofd rates, in direct violation of the law's intent. In effeci, the cost incr�ases fail disproportionately on the sho�alders of resider�tiaf customers who cvnser�e while wastefiul consumers and larger commercial customers may actually see their bills decrease. The intent of Mir�nesota's new water conservation law is to protect our one of our most precious natural resources by increasing costs as usage goes up. The Department of Natural Resources says thai is achieved by creating a biliing system with m�lti-tiered rates with a 25% to 5�% rate difference between each tier. In this area, Rose�ille's new siructure faifs on all accaunts: 1. there are only �wo billing levels, 2. commereiai cus�omers are exclud�d from usage-based rates, and 3. the difference E�e#ween the two tiers is nominal. Furthermore, small-�olume consumers see only a nominai savings if fhey are in the lowest category because a disproportional amount of their bill is a flat fee, subverting ihe financial incen�ive to save wa�er. In this case, the large fixed-rate makes small- users pay far more �er 1000 gallons used than larger customers (please see attached chart). Under the r�ew rate structure a residential customer in Rose�ille using 5000 gallons pays $7.40 per 10�0 gallons of water. In contrast, a cusfomer using 50,00� gaflons pays only $2:55 per gallon. This directly �ialates the intent o# the state law. As you can see in the attached char�, customers that use more than 50,000 gallons or more per billing periad will act�ally see their bills decrease under the r�ew system. This is because the majority of the increases were applied to the flat rate instead of the �sage-based rate. State Capital, St. Paul, MN 55155-'f606 (651 } 296-5645 jmarty@senate.mn