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REQUEST FOR COUNCIL ACTION <br />Department Approval: Manager Approved: <br />�� � �� `���� � <br />Item Description: Adopting the 2005 Utility Rate Adjustments <br />Date: �;'� l ��{}� <br />Item No: 3.e <br />Agenda Section: <br />��n���� <br />Background <br />At the January 24, 2005 Council Worksession, the City Council received a report and <br />presentation outlining Staff's recommendation for the 2005 utility rate adjustments. An excerpt <br />of the report is included below. <br />Excerpt of Staff Report (originally submitted 2/24/OS) <br />Over the past several weeks, Staff has been analyzing the City's utility operations to determine <br />whether rate adjustments are necessary for 2005. The analysis entailed a review of the following <br />services: <br />a) Water <br />b) Sanitary Sewer <br />c) Storm Water Drainage <br />d) Recycling <br />For each operation, the following service inputs were reviewed: <br />❑ Fixed City costs including personnel, supplies and maintenance, and depreciation <br />❑ Variable costs including the purchase of water from the City of St. Paul, water treatment <br />costs from the Metropolitan Council, and recycling contractor costs. <br />❑ Capital replacement costs <br />0 Current customer base, rates, and rate structure <br />On December 27, 2004, the City Council adopted the 2005 Budget for each of the operations <br />listed above. The remainder of this report summarizes the rate adjustment necessary to <br />accommodate the budget, and scheduled capital replacements over the next few years. <br />Discussion Items <br />Water O�erations: The City's water operation provides City customers with safe potable water, <br />as well as on-demand water pressure sufficient to meet the City's fire protection needs. The City <br />purchases its water supply from the City of St. Paul, which remains the single largest operating <br />cost to the water operation. Negotiations with The St. Paul Water Board for a new contract are <br />nearing completion. Based upon these negotiations and in recognizing water consumption that <br />had not previously been charged to Roseville, Staff estimates an increase of 5% in total water <br />purchase costs can be expected in 2005. This will necessitate a similar increase to Roseville <br />