ITEM 3.4 2020 Utility and Sewer RatesotS T
Y F O
MINNESOTA g
DEPARTMENT INFORMATION
Request for
City Council Action
ORIGINATING DEPARTMENT
REQUESTOR:
MEETING DATE:
Administration
City Administrator/Finance Director Flaherty
February 24, 2020
PRESENTER(s)
REVIEWED BY:
ITEM #:
Consent
3.4
STRATEGIC VISION
MEETS:
THE CITY OF OTSEGO:
X
Is a strong organization that is committed to leading the community through innovative
communication.
Has proactively expanded infrastructure to responsibly provide core services.
Is committed to delivery of quality emergency service responsive to community needs and
expectations in a cost-effective manner.
Is a social community with diverse housing, service options, and employment opportunities.
Is a distinctive, connected community known for its beauty and natural surroundings.
AGENDA ITEM DETAILS
RECOMMENDATION:
City staff is recommending that the City Council approve a resolution establishing water & sanitary sewer
utility rates for 2020.
ARE YOU SEEKING APPROVAL OF A CONTRACT?
IS A PUBLIC HEARING REQUIRED?
No
No
BACKG RO U N D/J USTI FI CATI O N:
The City has a public utility system with Water and Sanitary Sewer operations. The current system is
comprised of 4,028 customers who include both residential and commercial accounts. Those customers
receive monthly utility bills for usage of the water and sanitary sewer utility system. The monthly charges
include both a base fee, and a consumption fee which is calculated on their actual usage of the system.
The utility rates for the water and sanitary sewer systems are analyzed by the Finance Director on an
annual basis. This analysis includes: reviews of budget-to-actuals, preparation of the operating budget,
preparation of the capital improvement plan, and future projections.
The future projection cash flows include 2020 budgeted operating expenses with 2% annual inflation for
2021-2030. The cash flows also include capital expenses through 2029, and additionally include future debt
issuance with corresponding debt service payments. The revenue projections in the cash flows assume
inflation, rate adjustments and customer growth.
When evaluating the cash flows, it is important to not only monitor the cash balances, and that they
remain positive, but also the relationship between the cash balances and the cash balance reserve
percentage. The cash balance reserve is determined by calculating for 30% of the next year operating
budget; 100% of the next year capital budget; and 100% of the next year debt service budget. The reserve
percentage is then the actual cash balance as a percentage of the cash balance reserve.
The Water Utility fund (Operating #601 & WAC #360) cash balance is forecasted to be approximately $8.0
million for year-end 2019. Within the cash flows, a 3% rate increase is used throughout the projection
period. As can be noted by looking at the cash flow analysis, the cash balance is projected to be positive
through the remainder of the projection period. In addition to having positive cash balances, the cash
balances exceed the recommended 100% cash balance reserve. It should be noted that although the 3%
rate increase is currently adequate throughout the projection period; the addition of water treatment
capital projects into the cash flow could have an impact on the current rate assumptions.
The Sanitary Sewer Utility fund (Operating #602 & SAC #361) cash balance is forecasted to be
approximately $9.4 million for year-end 2019. Within the cash flows, a sliding rate increase is used
throughout the projection period. In the near -term, an 8% increase is used sliding to a 4% increase on the
tail -end of the projection period. As can be noted by looking at the cash flow analysis, the cash balance is
projected to be positive through the remainder of the projection period. Although cash balances are
positive, the percentage falls below the recommended 100% cash balance reserve beginning in 2025. The
primary reason for this is the increase in debt service payments beginning in 2025 for the West WWTF
Liquids Phase 1 Expansion. City staff is closely monitoring the need to initiate this expansion project. It will
be crucial to continue to closely manage financially between 2020 and 2026, when debt service payments
from existing infrastructure and new infrastructure will overlap. In 2027, the debt service from the existing
infrastructure will be paid off, and will provide relief to the cash flow.
The City Council approved the inclusion of a third -party utility rate study within the 2020 budget. This
formal rate study will help ensure that the City's rate structure is properly designed to meet the future
operating, capital and debt service needs. City staff is currently accepting proposals for this service, and
expects an agreement for Council approval within the next month. The goal is that the rate study will be
complete in time for 2021 budget considerations.
Of course, things are subject to change, and that is why it is important we look at these projections on an
annual basis and determine if rate changes are necessary. Based on the information provided, the Finance
Director would propose the following:
- Increase of 3% to Water Utility rates for 2020.
- Increase of 8% to Sanitary Sewer Utility rates for 2020.
These rate recommendations are the same as were discussed during the 2020 budget process and are
similar to rates suggested from the 2012/2013 Ehlers rate study.
SUPPORTING DOCUMENTS ATTACHED:
• Cash Flow Summaries
• Current & Historical Rates
• Monthly Bill Estimations
• Resolution 2020-11
POSSIBLE MOTION
PLEASE WORD MOTION AS YOU WOULD LIKE ITTO APPEAR IN THE MINUTES:
Motion to approve Resolution 2020-11, Establishing Water and Sanitary Sewer Utility Rates for 2020.
BUDGET INFORMATION
FUNDING: BUDGETED:
N/A I N/A
City of Otsego
Water Utility Fund
Cash Flow Summary
tevised: February 11, 2020
Estimated Bill (15k Gallons)
$
36.16
$ 37.25
$ 38.37
$
39.52
$
40.70
$ 41.92
$ 43.18
$ 44.48
$ 45.81
$ 47.18
$ 48.60
$ 50.06
Rate Increase (Inflation)
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
Rate Increase (Adjustment)
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
Total Rate Increase
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
3.00%
Availability Charge
$
1,781
$ 1,813
$ 1,831
$
1,849
$
1,868
$ 1,886
$ 1,905
$ 1,924
$ 1,943
$ 1,963
$ 1,983
$ 2,002
Connection Charge
$
1,781
$ 1,813
$ 1,831
$
1,849
$
1,868
$ 1,886
$ 1,905
$ 1,924
$ 1,943
$ 1,963
$ 1,983
$ 2,002
Connection Fee Inflation
2.90%
1.77%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
New Customers
300
417
189
189
189
189
189
189
189
189
189
189
Actual
Forecast
Budget I
Projected
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Water Fund
Operating
$ 1,485,917 $
1,531,708 $
1,609,212 $
1,690,639 $
1,776,185 $
1,866,060 $
1,960,482 $
2,059,683 $
2,163,903 $
2,273,396 $
2,388,430 $
2,509,285
Non -Operating
329,141
205,952
207,452
208,952
210,452
211,952
213,452
214,952
216,452
217,952
219,452
220,952
Transfers In
-
-
-
-
-
-
-
-
-
-
-
-
Bond Proceeds
-
-
6,600,000
-
5,485,000
-
-
-
-
-
-
24,000,000
WAC Fund
Connection Fees
1,162,836
1,511,814
691,330
698,244
705,226
712,278
719,401
726,595
733,861
741,200
748,612
756,098
Special Assessments
38,558
29,677
28,757
27,838
26,918
15,915
15,324
1,360
-
-
-
-
Investment Interest (Net)
-
-
-
-
-
-
-
-
-
-
-
-
Transfers In
-
-
-
-
-
-
255,571
320,253
-
-
-
-
Total
3,016,452
3,279,151
9,136,752
2,625,672
8,203,781
2,806,205
3,164,231
3,322,843
3,114,216
3,232,548
3,356,494
27,486,334
Expenses
Personal Servcies
117,556
142,576
145,428
148,336
151,303
154,329
157,415
160,564
163,775
167,051
170,392
173,799
Supplies
273,139
266,143
271,466
276,895
282,433
288,082
293,843
299,720
305,715
311,829
318,066
324,427
Services & Other Charges
378,418
492,340
298,044
304,005
310,085
316,287
322,612
329,065
335,646
342,359
349,206
356,190
Depreciation
565,000
600,000
612,000
624,240
636,725
649,459
662,448
675,697
689,211
702,996
717,056
731,397
Capital Outlay
201,192
-
-
-
-
-
-
-
-
-
-
-
Capital Outlay (General)
-
750
-
-
-
-
-
-
-
-
-
-
Capital Outlay (Fleet)
-
10,000
10,500
-
11,000
11,500
-
137,000
12,810
-
-
-
Capital Outlay (Current CIP)
-
2,305,788
6,470,000
460,000
6,532,500
-
120,000
70,000
97,000
1,820,000
-
24,000,000
Capital Outlay (Collection)
-
755,907
345,665
349,122
352,613
356,139
359,701
363,298
366,931
370,600
374,306
378,049
Capital Outlay (R & R Plan)
-
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
50,000
Debt Service (Existing)
1,974,486
1,050,858
1,055,178
1,062,198
1,070,199
865,548
824,171
823,997
-
-
-
-
Debt Service (Projected)
-
-
53,814
396,323
446,966
731,374
731,133
730,572
729,411
732,471
725,050
727,138
Transfers Out - General Fund
42,975
50,449
51,962
53,521
55,127
56,781
58,484
60,239
62,046
63,907
65,825
67,799
Transfers Out - Jet Vac
8,200
-
-
-
-
-
-
-
-
-
-
-
Total
3,560,966
5,724,811
9,364,057
3,724,640
9,898,951
3,479,498
3,579,808
3,700,151
2,812,544
4,561,212
2,769,899
26,808,799
Cash Balance - Beginning
8,007,452
8,000,288
6,154,628
6,539,323
6,064,594
5,006,149
4,982,315
5,229,186
5,527,575
6,518,458
5,892,789
7,196,440
Balance Sheet Effects
(27,650)
Revenues
3,016,452
3,279,151
9,136,752
2,625,672
8,203,781
2,806,205
3,164,231
3,322,843
3,114,216
3,232,548
3,356,494
27,486,334
Expenditures
(3,560,966)
(5,724,811)
(9,364,057)
(3,724,640)
(9,898,951)
(3,479,498)
(3,579,808)
(3,700,151)
(2,812,544)
(4,561,212)
(2,769,899)
(26,808,799)
Noncash - Depreciation
565,000
600,000
612,000
624,240
636,725
649,459
662,448
675,697
689,211
702,996
717,056
731,397
Cash Balance - Ending
$ 8,000,288 $
6,154,628 $
6,539,323 $
6,064,594 $
5,006,149 $
4,982,315 $
5,229,186 $
5,527,575 $
6,518,458 $
5,892,789 $
7,196,440 $
8,605,372
;ash Balance Reserve
Operating (3.5 Months of Next Year)
452,523
402,179
410,374
418,738
427,273
435,984
444,875
453,948
463,208
472,658
482,304
Capital (100% of Next Year Less Bond Projects)
3,122,445
276,165
859,122
1,461,113
417,639
529,701
620,298
526,741
2,240,600
424,306
428,049
Debt Service (100% of Next Year)
1,050,858
1,108,992
1,458,521
1,517,165
1,596,922
1,555,304
1,554,569
729,411
732,471
725,050
727,138
Total Cash Reserve Recommendation
4,625,826
1,787,336
2,728,017
3,397,016
2,441,835
2,520,989
2,619,741
1,710,099
3,436,279
1,622,014
1,637,490
Percentage of Cash Reserve on Hand
172.95%
344.35%
239.71%
178.53%
205.02%
197.63%
199.61%
323.23%
189.70%
363.30%
439.48%
\Budget\2021\Cash Flows\Utility Funds Combined Wate
City of Otsego
Sewer Utility Fund
Cash Flow Summary
N
tevised: February 11, 2020
Estimated Bill (5k Gallons)
$
41.99
$
45.35
$
48.98
$ 52.90
$ 56.60
$ 60.56
$
64.19
$
68.05
$
71.45
$
75.02
$
78.02
$ 81.14
Rate Increase (Inflation)
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
Rate Increase (Adjustment)
6.00%
6.00%
6.00%
6.00%
5.00%
5.00%
4.00%
4.00%
3.00%
3.00%
2.00%
2.00%
Total Rate Increase
8.00%
8.00%
8.00%
8.00%
7.00%
7.00%
6.00%
6.00%
5.00%
5.00%
4.00%
4.00%
Availability Charge
$
2,552
$
2,597
$
2,623
$ 2,649
$ 2,675
$ 2,702
$
2,729
$
2,756
$
2,784
$
2,812
$
2,840
$ 2,868
Connection Charge
$
7,656
$
7,792
$
7,870
$ 7,949
$ 8,028
$ 8,108
$
8,189
$
8,271
$
8,354
$
8,438
$
8,522
$ 8,607
Connection Fee Inflation
2.90%
1.77%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
1.00%
New Customers
300
417
189
189
189
189
189
189
189
189
189
189
Actual
Forecast
Budget I
Projected
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Sanitary Sewer Fund
Operating
Non -Operating
Transfers In
Bond Proceeds
SAC Fund
Connection Fees
Special Assessments
Investment Interest
Total
Expenses
Personal Servcies
Supplies
Services & Other Charges
Depreciation
Capital Outlay
Capital Outlay (General)
Capital Outlay (Fleet)
Capital Outlay (Current CIP)
Capital Outlay (Collection)
Capital Outlay (R & R Plan)
Debt Service (Existing)
Debt Service (Projected)
Transfers Out - General Fund
Transfers Out - WAC
Transfers Out - Jet Vac
Total
$ 2,227,691 $
8,000
2,404,052 $ 2,648,304 $ 2,917,371 $
15,000,000
3,184,019 $ 3,475,038 $ 3,757,212 $
27,260,000 -
4,062,297 $ 4,350,720 $
4,659,621 $
4,942,926 $ 5,243,456
3,714,291
4,332,213
1,981,078
2,000,902
2,020,726
2,040,928
2,061,318
2,081,898 2,102,854 2,124,000 2,145,146 2,166,480
90,214
64,183
62,233
60,283
58,333
27,024
26,029
3,395 - - - -
6,040,196
21,800,448
4,691,615
4,978,557
5,263,078
32,802,990
5,844,559
6,147,590 6,453,575 6,783,621 7,088,072 7,409,936
352,669
30 000 3 00
427,724
628,951
641,530
654,361
667,448
680,797
800,776
925,282
943,788
962,664
1,039,483
173,432
220,953
525,206
542,699
560,682
579,168
598,168
617,697
735,287
759,573
784,536
810,194
1,940,932
1,689,380
644,062
663,786
684,042
704,843
726,202
748,134
855,982
885,597
916,055
947,376
1,015,000
1,015,000
1,035, 300
1,056,006
1,077,126
1,098, 669
1,120, 642
1,143, 055
1,165, 916
1,189, 234
1,213,019
1,237,279
168,825
-
-
-
-
-
-
-
-
-
-
-
-
2,250
-
-
-
-
-
-
-
-
-
-
-
1,5
-
33,000
34,500
-
411,000-
-
13,428,113
45,000
-
2,500,000
25,000,000
100,000
800,000
-
-
-
-
-
1,732,885
792,431
800,361
808,291
816,371
824,527
832,759
841,142
849,600
858,058
866,592
49,500
200,000
225,000
250,000
275,000
300,000
325,000
350,000
375,000
400,000
425,000
425,000
3,510,058
1,868,192
1,875, 872
1,888,352
1,902,576
1,538,752
1,465,192
1,464,883
-
-
-
-
-
1,049,040
900,633
900,509
900,382
1,177,046
2,602,933
2,605,880
2,602,521
2,602,533
2,601,153
2,603,004
128,925
151,347
154,374
157,461
160,611
163,823
167,099
170,441
173,850
177,327
180,874
184,491
-
-
-
-
-
-
255,571
320,253
-
-
-
-
32,800
-
-
-
-
-
-
-
-
-
-
-
7,372,141
21,814,884
6,858,329
6,900,705
9,556,071
32,080,620
8,866,132
10,264,878
7,713,410
7,807,653
7,941,359
8,113,420
Cash Balance - Beginning
9,288,557
9,417,103
10,417,667
9,286,253
8,420,110
5,204,244
7,025,283
5,124,352
2,150,118
2,056,198
2,221,401
2,581,133
Balance Sheet Effects
445,491
Revenues
6,040,196
21,800,448
4,691,615
4,978,557
5,263,078
32,802,990
5,844,559
6,147,590
6,453,575
6,783,621
7,088,072
7,409,936
Expenditures
(7,372,141)
(21,814,884)
(6,858,329)
(6,900,705)
(9,556,071)
(32,080,620)
(8,866,132)
(10,264,878)
(7,713,410)
(7,807,653)
(7,941,359)
(8,113,420)
Noncash - Depreciation
1,015,000
1,015,000
1,035,300
1,056,006
1,077,126
1,098,669
1,120,642
1,143,055
1,165,916
1,189,234
1,213,019
1,237,279
Cash Balance - Ending
$ 9,417,103 $
10,417,667 $
9,286,253 $
8,420,110 $
5,204,244 $
7,025,283 $
5,124,352 $
2,150,118 $
2,056,198 $
2,221,401 $
2,581,133 $
3,114,929
:ash Balance Reserve
Operating (3.5 Months of Next Year)
1,022,118
871,469
892,933
914,907
937,402
960,432
1,015,030
1,124,759
1,153,693
1,183,335
1,230,490
1,261,933
Capital (100% of Next Year Less Bond Projects)
393,248
1,093,931
1,050,361
3,616,291
(1,109,129)
1,249,527
2,393,759
1,254,572
1,249,600
1,283,058
1,291,592
1,300,277
Debt Service (100% of Next Year)
2,917,232
2,776,505
2,788,861
2,802,958
2,715,798
4,068,125
4,070,763
2,602,521
2,602,533
2,601,153
2,603,004
2,597,429
Total Cash Reserve Recommendation
4,332,598
4,741,905
4,732,155
7,334,155
2,544,071
6,278,084
7,479,552
4,981,852
5,005,826
5,067,546
5,125,086
5,159,639
Percentage of Cash Reserve on Hand
217.35%
219.69%
196.24%
114.81%
204.56%
111.90%
68.51%
43.16%
41.08%
43.84%
50.36%
60.37%
\Budget\2021\Cash Flows\Utility Funds Combined Sewe
City of Otsego
Public Utility Charges
Monthly Bill Estimations
40 2020
Proposed
2012
2013
2014
2015
2016
2017
2018
2019
2020
Change
Residential (Winter= 5,200 Gallons)
Base Fee
$
8.00
$ 8.20
$ 8.41
$ 8.62
$ 8.62
$ 8.88
$ 9.06
$ 9.33
$ 9.61
Consumption: 0-10K Gallons
$
7.80
$ 8.01
$ 8.22
$ 8.42
$ 8.42
$ 8.68
$ 8.84
$ 9.10
$ 9.36
Subtotal - Water Charges
$
15.80
$ 16.21
$ 16.63
$ 17.04
$ 17.04
$ 17.56
$ 17.90
$ 18.43
$ 18.97
2.93%
Base Fee
$
5.00
$ 7.88
$ 8.27
$ 8.68
$ 8.85
$ 9.12
$ 9.48
$ 10.24
$ 11.06
Consumption (5.2K Gallons)
$
26.00
$ 25.38
$ 26.68
$ 27.98
$ 28.55
$ 29.38
$ 30.58
$ 33.02
$ 35.67
Subtotal -Sanitary Sewer Charges
$
31.00
$ 33.26
$ 34.95
$ 36.66
$ 37.40
$ 38.50
$ 40.06
$ 43.26
$ 46.73
8.03%
Total Monthly Estimated Bill
$
46.80
$ 49.46
$ 51.57
$ 53.70
$ 54.44
$ 56.06
$ 57.96
$ 61.69
$ 65.70
6.50%
Residential (Summer=13,975 Gallons + 2,375 Irrigation Gallons)
Base Fee
$
8.00
$ 8.20
$ 8.41
$ 8.62
$ 8.62
$ 8.88
$ 9.06
$ 9.33
$ 9.61
Consumption: 0-10K Gallons
$
15.00
$ 15.40
$ 15.80
$ 16.20
$ 16.20
$ 16.70
$ 17.00
$ 17.50
$ 18.00
Consumption: 10K+ Gallons
$
6.36
$ 6.52
$ 6.68
$ 6.84
$ 6.84
$ 7.04
$ 7.19
$ 7.39
$ 7.63
Consumption: Irrigation
$
3.80
$ 3.90
$ 3.99
$ 4.09
$ 4.09
$ 4.20
$ 4.30
$ 4.42
$ 4.56
Subtotal - Water Charges
$
33.16
$ 34.01
$ 34.88
$ 35.74
$ 35.74
$ 36.82
$ 37.55
$ 38.64
$ 39.80
3.00%
Base Fee
$
5.00
$ 7.88
$ 8.27
$ 8.68
$ 8.85
$ 9.12
$ 9.48
$ 10.24
$ 11.06
Consumption (5.2K Gallons)
$
26.00
$ 25.38
$ 26.68
$ 27.98
$ 28.55
$ 29.38
$ 30.58
$ 33.02
$ 35.67
Subtotal -Sanitary Sewer Charges
$
31.00
$ 33.26
$ 34.95
$ 36.66
$ 37.40
$ 38.50
$ 40.06
$ 43.26
$ 46.73
8.03%
Total Monthly Estimated Bill
$
64.16
$ 67.27
$ 69.82
$ 72.40
$ 73.14
$ 75.32
$ 77.61
$ 81.90
$ 86.53
5.66%
City of Otsego
Public Utility Charges
Water Rate Comparison
2020
Actuallncreases
n/a
2.50%
2.50%
2.50%
0.00%
3.00%
2.00%
3.00%
Proposed
2012
2013
2014
2015
2016
2017
2018
2019
2020
Change
Base Rate
5/8" Meter
$
8.00
$ 8.20
$ 8.41
$ 8.62
$ 8.62
$ 8.88
$ 9.06
$ 9.33
$ 9.61
3.00%
3/4" Meter
$
8.00
$ 8.20
$ 8.41
$ 8.62
$ 8.62
$ 8.88
$ 9.06
$ 9.33
$ 9.61
3.00%
1.00" Meter
$
8.00
$ 25.00
$ 25.63
$ 26.27
$ 26.27
$ 27.06
$ 27.60
$ 28.43
$ 29.28
2.99%
1.50" Meter
$
8.00
$ 50.00
$ 51.25
$ 52.53
$ 52.53
$ 54.10
$ 55.18
$ 56.84
$ 58.55
3.01%
2.00" Meter
$
8.00
$ 75.00
$ 76.88
$ 78.80
$ 78.80
$ 81.16
$ 82.78
$ 85.26
$ 87.82
3.00%
3.00" Meter
$
8.00
$ 150.00
$ 153.75
$ 157.59
$ 157.59
$ 162.31
$ 165.56
$ 170.53
$ 175.65
3.00%
4.00" Meter
$
8.00
$ 375.00
$ 384.38
$ 393.98
$ 393.98
$ 405.80
$ 413.92
$ 426.34
$ 439.13
3.00%
Residential & City Owned
Consumption (per
1k)
0-10,000 Gallons
$
1.50
$ 1.54
$ 1.58
$ 1.62
$ 1.62
$ 1.67
$ 1.70
$ 1.75
$ 1.80
2.86%
10,000 + Gallons
$
1.60
$ 1.64
$ 1.68
$ 1.72
$ 1.72
$ 1.77
$ 1.81
$ 1.86
$ 1.92
3.23%
Commercial, Industrial & Institutional Consumption (per 1k)
0 - 50,000 Gallons $ 1.50 $ 1.54 $ 1.58 $ 1.62 $ 1.62 $ 1.67 $ 1.70 $ 1.75 $ 1.80 2.86%
50,000 + Gallons $ 1.60 $ 1.64 $ 1.68 $ 1.72 $ 1.72 $ 1.77 $ 1.81 $ 1.86 $ 1.92 3.23%
Irrigation & Bulk WaterConsumption (per 1k)
All Usage $ 1.60 $ 1.64 $ 1.68 $ 1.72 $ 1.72 $ 1.77 $ 1.81 $ 1.86 $ 1.92 3.23%
City of Otsego
r 4\ Public Utility Charges
Sanitary Sewer Rate Comparison
t�1 2020
Actuallncreases
n/a
5.00%
5.00%
5.00%
2.00%
3.00%
4.00%
8.00%
Proposed
2012
2013
2014
2015
2016
2017
2018
2019
2020
Change
Base Rate
5/8" Meter
$ 5.00
$ 7.88
$ 8.27
$ 8.68
$ 8.85
$ 9.12
$ 9.48
$ 10.24
$ 11.06
8.01%
3/4" Meter
$ 5.00
$ 7.88
$ 8.27
$ 8.68
$ 8.85
$ 9.12
$ 9.48
$ 10.24
$ 11.06
8.01%
1.00" Meter
$ 5.00
$ 15.75
$ 16.54
$ 17.36
$ 17.71
$ 18.24
$ 18.97
$ 20.49
$ 22.13
8.00%
1.50" Meter
$ 5.00
$ 39.38
$ 41.34
$ 43.41
$ 44.28
$ 45.61
$ 47.43
$ 51.22
$ 55.32
8.00%
2.00" Meter
$ 5.00
$ 78.75
$ 82.69
$ 86.82
$ 88.56
$ 91.22
$ 94.87
$ 102.46
$ 110.66
8.00%
3.00" Meter
$ 5.00
$ 157.50
$ 165.38
$ 173.64
$ 177.11
$ 182.42
$ 189.72
$ 204.90
$ 221.29
8.00%
4.00" Meter
$ 5.00
$ 393.75
$ 413.44
$ 434.11
$ 442.79
$ 456.07
$ 474.31
$ 512.25
$ 553.23
8.00%
Consumption
Per 1,000 Gallons of Water Usage
$ 5.00
$ 4.88
$ 5.13
$ 5.38
$ 5.49
$ 5.65
$ 5.88
$ 6.35
$ 6.86
8.03%
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO: 2020-11
ESTABLISHING WATER & SANITARY SEWER
UTILITY RATES FOR 2020
WHEREAS, Otsego City Code Chapter 7; Section 2 outlines that in order to pay for the costs associated with
Water and Sanitary Sewer utility systems, that a just and equitable charge will be imposed upon users of
those systems; and
WHEREAS, the Otsego City Council has identified and reviewed the operating, capital and debt service
requirements of the Water and Sanitary Sewer utility systems.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OTSEGO, MINNESOTA:
1. That the following rates, fees and charged be imposed on users of the Water utility system:
a. Base Charge (All Users)
Meter Size
2020 Base
I Charge j
5/8"
$
9.61
3/4"
$
9.61
1.00"
$
29.28
1.50"
$
58.55
2.00"
$
87.82
3.00"
$
175.65
4.00"
S
439.13
b. Usage Rates (Per 1,000 Gallons of Consumption)
Customer Type
j
{ Consumption
2020
Rate
Residential &City Owned
0 - 10,000 Gallons
$ 1.80
Residential &City Owned
10,000+Gallons
$ 1.92
Commercial, Industrial & Institutional
0 - 50,000 Gallons
$ 1.80
Commercial, Industrial & Institutional
50,000+Gallons
Irrigation & Bulk Water
All
1
2
3
c. Bull(Water
In order to access bulk water from the system, a meter rental from the City is required.
There is a $200.00 deposit required for that meter. The rental fee for that meter is a
minimum of $50.00, which includes the first month, with each additional month being
charged at $50.00.
The consumption tracked by the meter will be billed at the rates identified in
paragraph 1(b) of this resolution. The local sales tax rate of 7.375% will also apply to
the entire bulk water rental and consumption charge incurred.
That the following rates, fees and charged be imposed on users of the Sanitary Sewer utility system:
a. Base Charge (All Users)
Meter Size
2020 Base
I Charge
5/8"
$
11.06
3/4"
$
11.06
1.00"
$
22.13
1.50"
$
55.32
2.00"
$
110.66
3.00"
$
221.29
4.00"
5
553.23
b. Usage Rates (Per 1,000 Gallons of Average December -February Water Usage)
I 2020
Customer Type j Consumption Rate
All Users Al $ 6.86
c. Minimum Charges
These charges come into effect for new accounts where there is less than three
months of usage history to base the average off of. This minimum monthly charge is
$45.36.
That the rates, fees and charges outlined in this resolution shall be effective for all billings issued on
or after March 1, 2020.
F)
ADOPTED by the Otsego City Council this 24th day of February, 2020.
MOTION BY:
SECONDED BY:
IN FAVOR:
OPPOSED:
CITY OF OTSEGO
Jessica L. Stockamp, Mayor
ATTEST:
Tami M. Loff, City Clerk