Patty Kettles of Springsted, a representative of Stacy’s financial advisors, was back at the city council to explain the flow of water/sewer rates. Kettles was asked to re-evaluate a rate increase extrapolation.
Kettles’ spreadsheet suggested a 10 percent annual increase is needed for the city’s water fund. Her recommendation remained a 10 percent increase in 2012 and a 7.5 percent increase in 2013 and 2014.
Councilor Jim Ness thought the rates seemed “awfully high” for the first three years.
This will add $25,000 to a maintenance capital fund. The rate increase would then phase downward, eventually phasing out a tax levy for sewer fund.
“A phased plan to get there is much easier, I don’t think you’re going to not want to do anything,” Kettles said.
“I don’t see that phasing the levy out is appropriate,” Mayor Mark Utecht said. He was concerned about the benefit to those properties not being served by water and sewer.
Councilor Chuck Lucia said this is a projection that could change every year. The consensus is the levy amount will not go away for now and this will make up for shortcomings in the last three years.
The water fund is healthy right now Kettles said.
“I think getting the sewer fund healthier is the way to do this as long as we can keep it at 10 percent per year or lower,” Utecht said.
City Clerk Sharon Payne verified a 7.5 percent increase should be budgeted for water and 10 percent for sewer.
Kettles asked if the council had any feedback on the information she prepared to send out to citizens regarding the rate increase.
The mayor had some concern about the message, city staff will review what Kettles has prepared for the newsletter.