2005_0131_Packet - Laserfiche WebLink

Home

customers. In addition, the City's own operating costs are expected to increase by approximately 5% due to higher personnel and capital replacement costs. Sanitarv Sewer O�erations: The City maintains a sanitary sewer collection system to ensure the general public's health and general welfare. The single largest operating cost to the sanitary sewer operation is the treatment costs paid to the Metropolitan Council Environmental Services Division (MCES). The MCES has notified us that our treatment costs are expected to increase 3% in 2005. In addition, the City's own operating costs are expected to increase by approximately 3%. Unlike the Water Fund, the Sanitary Sewer Fund has a strong reserve level that can be used to offset some of these increases. Storm Water Draina�e O�erations: The City provides for the management of storm water drainage to prevent flooding and pollution control, as well as street sweeping and the leaf pickup program. The storm sewer costs are expected to Increase substantially in 2005, due to the planned replacement of Stormwater systems. In an effort to ensure adequate funds are on hand for these replacements as well as other operating costs, an increase in the rates will be needed. Recvclin� O�erations: The recycling operation provides for the contracted curbside recycling pickup throughout the City. The primary operating cost is the amounts paid for a contractor to pickup recycling materials. Per the City's contract with the Recycling Hauler, a rate increase of 2% is being suggested. Recommendation After reviewing the needs of the various enterprise-type operations and the current rate structure, Staff feels a rate adjustment is warranted. This is based on the following: ]� The City will realize a 2-5% increase from various service providers including the City of St. Paul, MCES, and Waste Management. �� The City is projecting a 3-5% increase in City-controlledoperating costs. �� Substantial capital replacement costs will be incurred in the next several years that will require both the use of existing reserves, as well as planned rate increases. �� The City has fixed costs that it must recoup independent of the amount of citywide usage. 5� The City has typically applied rate adjustments on an equal percentage basis across various property types. After a brief discussion, the Council agreed to accept Staffs recommendation. A resolution to adopt the recommendedrates is attached. Council Action Requested Adopt the attached Resolution establishing the 2005 Utility Rates.