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I I I Council Meeting Minutes April 25, 1995 Page 9 Council Business. continued Samuelson hopes the trial offer is successful. Motion by Williams, seconded by Samuelson, to APPROVE A SHARED SUMMER MEMBERSHIP PROGRAM BETWEEN SHOREVIEW'S COMMUNITY CENTER AND NEW BRIGHTON'S FAMILY SERVICE CENTER. 5 Ayes - 0 Nayes, Motion Carried. Egan presented the establishment of the 1995 customer charges for utilities. Customer charges are used to pay utility operations and are reviewed annually to ensure charges are adequate. Staff recommends the following: stormwater fees be adequate to cover expenses; water charges be increased from $.91 to $1.05 per 1,000 gallons; sewer charges be increased from $2.10 to $2.25 per 1,000 gallons; and flat fees be eliminated and replaced by a per 1,000 gallon fee. The billing strategy for water, sewer, and stormwater is a consumption based strategy where the individual usage is multiplied to arrive to a fee. Stormwater fees are on a per acreage charge. System charges cover the operation of water towers, mains, lift stations, and stormwater projects. Consumption charges pay for producing and treating water. The 1995 budget will see a 12.5% increase over 1994 actual costs. This increase is the result of the storffiwater utility becoming fully operational and added costs for system repairs for water and sewer services. The rates will become effective May 1995 and carry through April 1996. In 1995, the City will have $178,000 in customer charges collected for the stormwater utility fund, however, the 1995 stormwater costs will be $385,400. Egan noted that the stormwater costs will be averaged out over a five year period where the ending years' anticipated project costs will be below revenue. Unlike the stormwater utility, the water system's revenues are collected through consumption charges, environmental restoration fund, and treatment plants. Customers are charged only 75 % of the water system costs because of the assistance from the treatment plant revenues and the environmental restoration fund which is the Army's responsibility. Expenditures include personnel costs, materials and supplies, contractual services, and system care. The sewer utility is financed through consumption charges, flat fees, and late charges. Sewer expenses involve the MCWWS (Metropolitan Treatment Facility) which treats sewer discharge. Benke noted that the Wolkerstorfer Company's sewer utility consumption decreased in 1994. Egan verified that the MCWWS charge is a variance which will not be recovered by the City, but the bottom line is the projected sewer volume. In 1995, the City would be in a cash deficient position because of stormwater projects. Staff proposes to develop a water service reserve where $20,OOO/year would be collected between 1995-1999 to be used for water utilities. The storm water utility will begin a similar reserve program in 1996. Staff intents to finalize the sewer utility budget in 1996 after receipt of MCWWS information. The impact for funding a water service reserve would be an additional $.02 per 1,000 gallons. Council Business Joint Recreation Membership Report 95-063 Establishment of 1995 Utility Rates Report 95-064 Resolution 95-031