02 City Council Min (6/14/04) - Laserfiche WebLink

Home Browse Search

Regular Meeting City Council June 14, 2004 Page 8 Mr. Klein informed the Council that the firm had recently been purchased by R. W. Beck and was called by R.W. Beck now. He related that the City had a contractual obligation with Campbell's Soup which requires them to conduct an annual rate study and they were hired to do this year's study. Mr. Klein informed the Council that there has been a decrease in water and wastewater expenditures, mostly because of electricity costs have decreased because the City has load aggregation agreement which has given them a better electrical rate and saved them about $130,000. He continued that there has been a reduction in the amount of money spent for equipment and for maintenance and repair and replacement items. He had a concern that if too much money was kept from maintenance, repair and replacement, that might cause a problem in the long run and cost more money than was potentially saved in the first place. He mention that operating costs had declined over the past two years. He summarized the findings from the study by noting there had been a decrease on the wastewater side in expenditures, but there had been more of a decline in the consumption of water, which drives the wastewater volumes. He explained when the volumes fall faster than the costs, that automatically results in an increase in rates. He said the rate increase should be a least $0.05 per 100 cubic feet, at a minimum. In addition to the five cent increase in wastewater rates, he said R. W. Beck was also recommending a 5% increase in water and wastewater rates. He explained this would restore depleted operating reserves and would help in case they have to issue more debt for water treatment plant improvements needed to maintain the plant's rated capacity.