10 - Wastewater Treatment Plant Project and presentation of bids

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middle of implementing rate increases every six months through April 2026. We must now change our plan as follows (this is still approximate — we will have a final recommendation at the 10/24/22 City Council meeting): Waste Water Rate e Increase Our current rate program was proving to be very successful in meeting expense needs for our initial bond, so we are confident that the figures provided by our consultant for the adjusted rates will likewise cover our needs for the additional $26 million needed. There is however still uncertainty when it comes to Phase II as we cannot guarantee pricing at this point given what we have seen in Phase I. RECOMMENDATION: 1. This agenda item is primarily information only unless the City Council feels certain actions should be taken. It is our recommendation that we proceed with awarding a bid, increasing the waste water rates, and issuing additional debt service on October 24, 2022. The bid is only good for 90 days from September 8, 2022, so a decision will need to occur by December 8, 2022. ADDITIONAL THOUGHTS: This is a bleak and daunting challenge for our citizens to take on. While it could be easy to once again kick this can down the road, we would face a much greater chance of making this worse than better (proof is what is happening to us today). But, while we are facing this great expense today, there is indeed hope in the very near future for some potential relief. Rate Increases Increase 5k Gallon Bill Date Current New Current New Apr -21 8.50% _ No Change Oct -21 8.50/ No Change Apr -22 8.50% No Change Oct -22 3.75% No Change Jan -23 0.00% ...__ .......�. _ 9.00% $ 61.41 $ 66.92 Apr -23 3.75% 9.00% .--- ........ $ 63.70 $ 72.95 Oct -23 3.75% I 7.50% $ 66.10 vvv $ 78.44 Apr -24 3.75% 7.50% $ 68.59 $ 84.33 Oct -24 4.25%0,00% ... $ 71.48 $ 84.33 Apr -25 4.25% 0.00% $ 74.50 $ 84.33 Oct -25 �_ 4.25% 6.75% ._w... _ $ 77.66 $ 90.03 Apr -26 4.25%.. 6.75% .... $ 80.96 -1 $ 96.12 Our current rate program was proving to be very successful in meeting expense needs for our initial bond, so we are confident that the figures provided by our consultant for the adjusted rates will likewise cover our needs for the additional $26 million needed. There is however still uncertainty when it comes to Phase II as we cannot guarantee pricing at this point given what we have seen in Phase I. RECOMMENDATION: 1. This agenda item is primarily information only unless the City Council feels certain actions should be taken. It is our recommendation that we proceed with awarding a bid, increasing the waste water rates, and issuing additional debt service on October 24, 2022. The bid is only good for 90 days from September 8, 2022, so a decision will need to occur by December 8, 2022. ADDITIONAL THOUGHTS: This is a bleak and daunting challenge for our citizens to take on. While it could be easy to once again kick this can down the road, we would face a much greater chance of making this worse than better (proof is what is happening to us today). But, while we are facing this great expense today, there is indeed hope in the very near future for some potential relief.