09/28/04 - Laserfiche WebLink

Home

Finance Officer Lund replied the cost is the same, what is different is that both the trunk and the WAC were not totally complete on the schedule. Also, the ending balance at this time would go down to two million dollars, in which it had not gone lower than four million dollars. Staff is proposing to have a 50 percent year operating expense, which goes into effect by 2014. By the time that comes into play they should have a very good knowledge of what is happening with trunk and WAC charges. Assistant Public Works Director Olson explained when the suggested trunk charges were compared to other cities they were shockingly high. The rates were within the range, but closest to thc highest. Bob Brown of Bolton & Menk explained as they prepared both the comprehensive sewer and water system, there was a lot of information and data. He apologizes for probably not being as concise on the financial rates. There were ranges for the sewer and assumptions for the water system that should have been clearer. He indicated the Committee's packet includes a handout that summarizes the original plan and the revised recommendations. There are also comparisons of surrounding cities that are for SAC, WAC and total charges. Dave Martini of Bolton & Menk stated when they discussed the comprehensive plan he was not clear on the fees and did not go into enough detail. The comprehensive sanitary sewer report talks about tees, and they had laid out the trunk system on the map that showed how the system could be expanded in the future. With the estimated total cost of the improvements of about 27 million dollars, the City's current charge of $596 per connection fell short of the needed funds to expand that system. The figure of $1,800 per unit was calculated to reach the 27 million dollars. Chairperson Elvig questioned how the 27 million dollars was determined, as he thought the cost of the main trunk was closer to 12 million dollars. Mr. Martini explained the 27 million dollars was basically everything that was shown on the map in the report, which includes the lift stations and all the lines on the map. They went on to say in the report that this amount is somewhat deceiving because when the system is expanded developers wonld be responsible for 8-inch lines in developments, rather than the City. When subtracting out the 8-inch lines they come up with a number of 16 million dollars. This equates to $1,100 per connection. That is where the confusion came in. Both of these numbers were presented, where in reality the $1,100 number equates more to the City's actual cost of expanding the system. He explained this way of charging matches the way the City has been financing these projects in the past. Mr. Brown advised he recommends that the rate increase start in January 2005 for the increase of the trunk charge, as well as the increase in the SAC charges from $596 to $1,100. Councihnember Strommen requested clarification that this would be a one-time increase, rather thau incremental. Finance Committee/September 28, 2004 Page 2 of 7