ITEM 1Ot�
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MINNESOTA
TO: Otsego Mayor and City Council
FROM: Gary Groen, Finance Director
DATE: November 8, 2012
RE: Ehlers Presentation of the Water and Sewer Rate Study
Earlier this year the Council approved Ehlers to complete a study of the City's water and
sewer utility rates. The process included several steps including the following:
• Discussion of the City's objectives for conducting a utility rate study,
• Delivery of information from the City including previous financial statements,
current year activity to date, preliminary 2013 budgets, capital improvement plan
information, current utility rates and connection charges, current debt service
obligations, growth projections, water consumption information and other
relevant information,
• Develop a pro forma cash flow projection with the proposed utility rates, capital
improvement plan expenditures and debt service obligations,
• Develop information comparing proposed utility rates with comparable
communities,
• Develop information comparing the proposed utility rates with the current
commercial and resident utility bills,
• Discuss and present proposed utility rate options, and
• Present the utility rate proposal to the City Council for review and approval.
Ehlers representatives discussed the preliminary results of the utility rate study at the
administrative subcommittee on Wednesday, October 24. Representatives from Ehlers
will be presenting a PowerPoint summary of the results and recommendations of the
utility rate study at the special workshop meeting on Tuesday, November 13.