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01-13-14 City Council WS AgPCITY OF SHOREWOOD CITY COUNCIL WORK SESSION MONDAY, JANUARY 13, 2014 AGENDA 1. CONVENE CITY COUNCIL WORK SESSION A. Roll Call B. Review Agenda 2. CIP AND ENTERPRISE BUDGETS 3. RATE STUDY DISCUSSION 4. ADJOURN 5755 COUNTRY CLUB ROAD COUNCIL CHAMBERS 6:00 P.M. Mavor Zerbv Hotvet Siakel Sundberg Woodruff ATTACHMENTS Finance Director's memo Finance Director's memo #2 MEETING TYPE City of Shorewood Council Meeting Item Work Session Title / Subject: 2014 CIP and Enterprise Budgets Meeting Date: January 13, 2014 Prepared by: Bruce DeJong, Finance Director Reviewed by: Bill Joynes, City Administrator Attachments: Enterprise Budget Spreadsheets Technology Upgrades 2014 -2023 CIP Report by Funding Source Policy Consideration: Now should the City of Shorewood prepare its Capital Improvement Plan (CIP) and enterprise fund budgets for 2014? Background: Staff has incorporated the suggested changes to the budgets and CIP projects from the meeting on November 12 and the rate study process. These budgets fully fund all activities in 2014. The current service levels are maintained but no new services or facilities are included in the proposed budgets. The rate study recommendations for 2014 are included in the revenue sections of the Sewer and Storm water funds. The CIP has been adjusted to reflect the consensus that Eureka Road North will not be reconstructed to MSA standards. It has been removed from the MSA fund for 2019. Staff has not yet determined what type of repairs will be necessary so this segment is not included in the general street reconstruction plans at this point. In order to show the true effects of the MSA funding of the Smithtown Road and Galpin Lake Road sidewalk segments, staff have included the projected reimbursements in the MSA fund. The Sewer, the Water and the Stormwater Management budgets all include expense line items called Maintenance - Equipment. While we have not spent that full amount in recent years, the cost of the parts and service could easily exceed the budget amount if a major piece of equipment breaks down at a critical time. Staff believes the amounts budgeted for 2014 are appropriate. The Stormwater Management Budget includes a General Supplies expense line item for an amount of $3,000 in 2013 and 2014. Despite not having spent over $2,200 in recent years, staff believes the amount budgeted for 2014 is appropriate. As can be gleaned from the fact that we have not exceeded budget in a number of areas, staff only spends what is necessary — not the full amount budgeted. The enterprise fund budgets use the full accrual method of accounting. That means that there no expense item for the purchase of items like land or easements for road and trail projects. The accounting transaction is an exchange of assets — in this case cash is swapped for land on the balance sheet. Therefore, no expense for asset purchase should be shown in any enterprise funds. This is the same reason that we do not show bond principle repayments as an expense. We merely reduce the asset of cash and reduce the liability of debt. We include the amounts in the cash flow projection for evaluating rate increases and the financial management plan. The Recycling budget includes a revenue line item City Clean -up Fees in the amount of $6,000 for 2013 and 2014, yet the history for this item has been a loss. Staff intends to change the accounting for this line. Previous practice has been to net the expenditures against the revenues for cleanup costs. For 2013 and going forward, staff will record revenues only on this line item and expenditures will be recorded separately in the Misc Services line item. Individual items on the technology upgrade list will be brought back to Council before any money is spent on them. Several computers were scheduled for replacement in 2013 staff waited on ordering until the end of the year to make sure that they would be compatible with the new financial software and the ArcView mapping software. These purchases were then delayed until 2014 in order to take advantage of the sales tax savings. Staff is asking for $5,000 of the 2013 allocation to be moved forward to 2014. The 2014 total budgeted amount on the list now equals the amounts in the CIP. The Park Improvements CIP has been changed to reflect purchasing and installing the monument sign for Gideon Glen in 2014. The $100,000 in 2014 for Badger Park is a placeholder and does not include relocating the lights. The Street Reconstruction CIP includes Amlee Road for reconstruction in 2016 based on pavement condition. Glen Road is on the list only for seal coating based on current condition ratings. Staff will evaluate those roads again this spring and determine if conditions have changed enough to warrant inclusion of Glen Road in a reconstruction project. The Water CIP includes funding for the rehabilitation and painting of the West Water Tower in 2013. That was not done in 2013 so that $450,000 has been moved to 2014. The water tower is inspected annually and when conditions warrant, a rehab will be brought back to the City Council for authorization. Financial or Budget Considerations: These program expenses are feasible based on the rate study and financial management plan. Options: The City Council is encouraged to discuss any capital project and enterprise budget changes with staff. Recommendation / Action Requested: Staff recommends that the City Council finalize these budgets prior to adoption in January. Next Steps and Timelines: The budgets and CIP will be used to guide activities for the year. Connection to Vision / Mission: Adopting a prudent budget contributes to sound financial management. WATER FUND Revenue Coding: 601- Expenditure Coding: 601 - 49400- 700,675 720,652 814,742 703,500 446,567 Dept -1% (6,000) 620 Fiscal Agent Fees Actual Actual Actual Budget YTD Request Percent Dollar REVENUES 2010 2011 2012 2013 Thru Oct 2014 Change Change 37110 Water Sales 465,861 509,737 611,047 630,000 404,643 630,000 0% 0 36101 Special Assessments 211744 171148 19,119 35,000 11,568 15,000 -57% (20,000) 37170 Permits & Connection Fees 29,184 15,490 211230 1,000 20,910 15,000 1400% 14,000 36210 Interest Earnings 31,999 30,359 371714 35,000 0 35,000 0% 0 37171 Water Meter Sales 3,028 1,690 1,845 2,500 4,360 2,500 0% 0 37175 Antennae Space Rental 148,859 146,228 123,787 0 0 0 21% 0 39310 Bond Proceeds 84,598 105,904 137,295 108,585 5,086 0 -1% 0 Total Revenues 700,675 720,652 814,742 703,500 446,567 697,500 -1% (6,000) 620 Fiscal Agent Fees - - - - - 1011440 #DIV /0! 1011440 Total Transfers 53,680 57,757 75,200 69,450 48,762 180,290 110,840 TOTAL EXPENSES #REF! #REF! #REF! #REF! #REF! #REF! #REF! #REF! EXPENSES #REF! #REF! #REF! #REF! #REF! #REF! Personal Services 101 Regular Salaries 64,359 80,270 105,532 82,365 53,761 79,796 -3% (2,569) 102 O.T. Salaries 2,057 2,926 1,348 3,000 6,556 3,000 0% 0 121 PERA City Share 4,524 5,915 7,945 6,189 4,369 6,003 -3% (186) 122 FICA City Share 4,817 5,936 71720 6,531 4,342 6,334 -3% (197) 131 Ins. City Share 8,158 10,857 141750 10,501 6,560 121726 21% 21225 Total Personal Services 84,598 105,904 137,295 108,585 75,588 107,858 -1% (727) 208 Postage 11235 1,354 11292 1,300 983 11400 42% 417 221 Maint- Equipment 41244 3,027 5,494 6,500 4,332 6,500 0% 0 223 Maint - Buildings 252 444 2,335 1,000 760 1,000 0% 0 240 Small Tools 290 43 686 550 - 550 0% 0 245 General Supplies 7,608 10,457 11,891 10,000 13,383 10,000 0% 0 260 Wtr Purch - Tonka Bay 21125 2,662 3,331 3,300 1,682 3,500 6% 200 261 Wtr Purch - Excelsior 18,892 20,001 211221 17,500 13,912 22,000 26% 4,500 262 Wtr Purch - Mtka 687 11269 11245 1,000 746 1,500 50% 500 263 Wtr Purch - Chan 11,380 13,122 15,645 12,000 9,163 16,000 33% 4,000 265 Water Meters 5,631 4,024 10,659 15,000 2,672 15,000 0% 0 Total Supplies 52,445 56,403 73,908 68,150 47,779 77,450 14% 9,300 Other Services & Charges 301 Financial & Audit 21250 296 - 21250 - 21500 2,500 303 Engineering 2,070 - 11,926 5,000 125 5,000 4,875 321 Communication 978 822 766 2,500 498 2,800 12% 300 331 Travel, Conf,Sch 350 700 525 600 - 800 33% 200 351 Print /Publish 628 583 558 1,000 552 1,000 0% 0 360 Insurance-Total 7,816 - - 8,000 - 8,000 0% 0 394 Utilities - Amesbury 9,672 11,620 11,835 11,000 10,149 12,000 9% 1,000 395 Utilities - Badger 10,243 11,645 8,557 11,000 7,518 12,500 14% 1,500 396 Utilities - Boulder Bridge 16,799 18,287 21,565 18,500 17,692 20,000 8% 1,500 440 Misc. Services 126 137 196 200 221 200 0% 0 450 Bank Svc Chgs 95 - 44 525 - 1,000 475 Total Other Services & Charges 99,288 376,784 377,331 413,575 91,011 421,800 2% 8,225 Transfers 720 Transfers to General Fund 12,500 12,500 611 Bond Interest 88,940 #DIV /0! 88,940 620 Fiscal Agent Fees - - - - - 1011440 #DIV /0! 1011440 Total Transfers 53,680 57,757 75,200 69,450 48,762 180,290 110,840 TOTAL EXPENSES #REF! #REF! #REF! #REF! #REF! #REF! #REF! #REF! REVENUES OVER /(UNDER) EXPENSES #REF! #REF! #REF! #REF! #REF! #REF! SEWER FUND Revenue Coding: 611 - Expenditure Coding: 611- 49450- REVENUES 36210 Interest Earnings 37210 Sewer Sery Charges 37220 Sewer Chg -Cnty Coll 37250 Local SAC Charges 37270 Sewer Permits 39201 Tsfr From Other Funds Dept Actual Actual Actual Budget Thru Oct Request Percent Dollar 2010 2011 2012 2013 2013 2014 Change Change 38,439 27,939 29,842 36,000 69 36,000 812,537 792,420 801,996 825,000 619,535 835,000 28,456 25,877 26,493 5,086 2,400 - 2,400 - 12,000 - 1,650 1,200 3,150 700 1,860 700 60,000 - - - - - 0% 0 1% 10,000 #DIV /0! 0 #DIV /0! 0 0% 0 0 Total Revenues 943,482 847,436 863,881 861,700 638,550 871,700 1% 10,000 EXPENSES Personal Services 101 Regular Salaries 53,842 76,410 68,000 71,331 50,132 69,186 -3% (2,145) 102 O.T. Salaries 922 2,177 2,636 2,000 2,116 2,500 25% 500 121 PERA City Share 3,740 5,541 5,343 5,316 3,780 5,197 -2% (119) 122 FICA City Share 4,004 5,690 5,182 5,610 3,787 5,484 -2% (126) 131 Ins. City Share 6,538 10,177 13,456 9,017 5,281 10,787 20% 1,770 Total Personal Services 69,729 99,995 94,617 93,274 65,096 93,155 0% (120) Supplies 200 Office Supplies 102 105 109 110 146 150 36% 40 208 Postage 1,211 1,299 1,265 1,500 989 1,500 0% 0 221 Maint- Equipment 14,640 1,673 1,182 5,000 2,507 5,000 0% 0 240 Small Tools 79 120 45 550 9,163 550 0% 0 245 General Supplies 919 1,519 550 2,100 1,055 2,100 0% 0 Total Supplies 16,951 4,716 3,151 9,260 13,860 9,300 0% 40 Other Services & Charges 300 Financial & Audit 2,250 - - 2,250 - 2,500 11% 250 303 Engineering 13,927 5,000 9,366 5,000 0% 0 313 Engineering - Design Stage 4,634 - 583 5,000 1,701 5,000 0% 0 321 Communication 3,806 4,108 3,374 4,500 3,230 4,500 0% 0 331 Travel, Conf,Sch 934 1,300 1,300 1,500 975 1,500 0% 0 360 Insurance -Total 5,225 - 773 6,500 - 7,000 8% 500 380 Utilities- Gas /Elec 5,919 6,518 5,326 6,000 4,365 7,500 25% 1,500 385 MCES Service Charges 564,332 714,110 675,409 584,084 397,039 575,000 -2% (9,084) 440 Misc. Services 126 160 195 150 244 150 0% 0 450 Service Charges 110 4 12 900 - 1,500 67% 600 Total Other Services & Charges 649,367 1,012,956 959,140 893,384 439,861 887,150 -1% (6,234) Transfers 720 Transfers to General Fund 12,500 12,500 720 Transfers to Storm Water 226,700 226,700 Total Transfers - - - - - 239,200 239,200 TOTAL EXPENSES 736,047 1,117,667 1,056,908 995,918 518,817 1,228,805 23% 232,887 REVENUES OVER /(UNDER) EXPENSES 207,435 (270,231) (193,027) (134,218) 119,733 (357,105) RECYCLING FUND Revenue Coding: 621 - Expenditure Coding: 621- 49550- REVENUES 33620 County Recycling Aid 33621 County Park Recycling Grant 36101 Special Assessment 36210 Interest Earnings 37310 Recycling Service Charges 37320 City Clean -up Fees Dept Actual Actual Actual Budget Thru Oct Request Percent 2010 2011 2012 2013 2013 2014 Change 23,560 23,086 23,007 23,000 25,830 23,000 10,500 184,350 2% 5,184 5,588 2,602 656 319 528 350 - 350 154,279 147,957 154,288 155,000 120,022 155,000 - (1,247) (2,291) 6,000 5,086 6,000 0% -34% 0% -362% Total Revenues 178,495 185,799 181,120 184,350 153,540 184,350 2% EXPENSES Personal Services 101 Regular Salaries - 986 - - - - 102 O.T. Salaries 788 997 774 1,000 - 1,000 29% 103 Part Time Salaries 4,307 3,223 4,126 5,251 2,192 5,410 31% 121 PERA City Share 353 368 339 450 159 475 40% 122 FICA City Share 388 388 377 475 168 500 33% 131 Ins. City Share - 219 876 619 427 717 -18% Total Personal Services 5,836 6,181 6,492 7,795 2,946 8,102 25% Supplies 200 Office Supplies 102 105 109 100 - 100 -8% 208 Postage 1,211 1,176 1,904 900 973 900 -53% 245 General Supplies 170 352 664 200 193 200 -70% Total Supplies 1,483 1,633 2,677 1,200 1,166 1,200 -55% Other Services & Charges 400 Contractual 166,449 166,668 165,730 166,992 139,769 166,992 0% 440 Misc. Services 8,405 112 12,810 8,000 9,163 8,000 0% 450 Service Charges - 241 - - - - #DIV /0! Total Other Services & Charges 174,854 167,021 178,540 174,992 148,932 174,992 -2% TOTAL EXPENSES 182,173 174,835 187,709 183,987 153,044 184,294 0% REVENUES OVER /(UNDER) EXPENSES (3,678) 10,964 (6,589) 363 496 56 STORMWATER MANAGEMENT FUND Revenue Coding: 631 - Expenditure Coding: 631- 49600- Total Revenues 209,431 200,300 195,342 208,675 10,575 Dept 120% 248,877 Actual Actual Actual Budget Thru Oct Request Percent Dollar REVENUES 2010 2011 2012 2013 2013 2014 Change Change 33620 Grant Proceeds 5,202 - - 5,100 - - -100% (5,100) 36101 Special Assessments 7,651 6,957 7,605 - 5,483 7,400 -28% 71400 36210 Interest Earnings 5,637 4,331 1,411 3,000 - 1,200 -60% (1,800) 36270 Miscellaneous Revenue 122 - - 75 6 - -100% (75) 37410 Storm Utility Charges 190,819 189,012 186,326 200,500 5,086 224,352 12% 23,852 39202 Transfers from Sewer 2,448 4,643 5,099 2,879 1,277 226,700 -28% (820) Total Revenues 209,431 200,300 195,342 208,675 10,575 459,652 120% 248,877 EXPENSES Personal Services 101 Regular Salaries 17,816 34,739 45,744 28,478 29,380 20,523 -28% (7,955) 102 O.T. Salaries 158 163 1,348 - 121 PERA City Share 1,186 2,543 3,336 2,065 2,218 1,500 -27% (565) 122 FICA City Share 1,287 2,632 3,269 2,179 2,226 1,570 -28% (609) 131 Ins. City Share 2,448 4,643 5,099 2,879 1,277 2,059 -28% (820) Supplies 200 Office Supplies 102 105 109 100 146 100 100 208 Postage 1,211 1,176 1,265 1,000 973 1,200 243% 850 221 Maint- Equipment - - - 5,500 1,000 5,500 0% - 240 Small Tools - - 300 - 300 0% - 245 General Supplies 1,268 2,283 310 3,000 669 3,000 - Total Supplies 2,581 3,564 1,684 9,900 2,788 10,100 2% 200 9,163 Other Services & Charges 303 Engineering 8,384 23,869 10,914 5,000 3,782 20,000 300% 15,000 304 Legal 46 241 2,534 1,000 - 11000 0% - 313 Engineering - Design Stage 1,418 5,198 5,955 5,000 4,883 5,000 0% - 321 Communication - - 315 500 166 500 0% - 351 Print /Publish - 324 64 100 128 100 0% - 400 Contractual 40,871 41,752 36,430 50,000 4,359 71,500 43% 21,500 420 Depreciation 19,833 25,250 32,314 33,000 - 34,000 3% 1,000 433 Subscrip- Member - - 600 - 6,600 1000% 6,000 440 Misc. Services 1,748 117 935 1,100 221 1,100 0% - 450 Service Charges 14 - - 500 - 1,000 500 Total Other Services & Charges 72,314 96,751 89,461 96,800 13,539 140,800 45% 44,000 TOTAL EXPENSES 97,632 233,034 162,944 142,301 52,776 176,552 24% 34,251 REVENUES OVER /(UNDER) EXPENSES 111,799 (32,734) 32,398 66,374 (42,201) 283,100 City of SFiorewoocl Current \/L-r: 1/9/14 12 =33 PM CIP Potential Technology Upgrades /Additions I3escription - Capital Outlay portion Vear 2014 2015 2016 2017 2018 Customer Response Management (CRM) Software for citizen non - emergency reporting of community issues (potholes, etc). GPS based system, can be used from smartphone, can customize email notifications to residents,includes interactive map, and integrates with facebook, twitter; auto - assigns service requests, generates service reports, and more. $ 6,000 Customer Response Management (CRM) Software for citizen non - emergency reporting of community issues (potholes, etc). GPS based system, can be used from smartphone, can customize email notifications to residents,includes interactive map, and integrates with facebook, twitter; auto - assigns service requests, generates service reports, and more. Mapping Zkrc\/iew /CityLink - $ 6,000 $ 4,000 $ 4,000 Mapping Zkrc\/iew /CityLink - City Hall Key -Pad door acccess for city hall, election equipment storage closets, and alarm for basement doors to outside. $ 2,500 $ 2,500 $ 2,500 Wireless Panic Alarm System for Reception Counter and Chambers $ 1,750 Wiring for Cable service in Chambers, Large Conference Room, Kitchen /Break Room, and Lobby, with monitors; high definition projector in Council Chambers $ 5,000 Recording Sign and Wiring for the Sign in Council Chambers $ 250 Computer, Software, and Peripheral Upgrades $ 15,000 1 $ 10,000 $ 10,000 $ 10,000 $ 10,000 I-11-not-I 1 S 36.500 S 10.000 S 10.000 S 10.000 S 10.000 11-11-not-all I Is G-500 Is G-500 Is G-500 Is 6' 500 I description - Operating Expense portion to be included in department budgets Customer Response Management (CRM) Software for citizen non - emergency reporting of community issues (potholes, etc). GPS based system, can be used from smartphone, can customize email notifications to residents,includes interactive map, and integrates with facebook, twitter; auto - assigns service requests, generates service reports, and more. $ 4,000 $ 4,000 $ 4,000 $ 4,000 Mapping Zkrc\/iew /CityLink - $ 2,500 $ 2,500 $ 2,500 $ 2,500 11-11-not-all I Is G-500 Is G-500 Is G-500 Is 6' 500 I City of Shorewood, Minnesota Capital Improvement Program 2014 thn, 2023 PROJECTS BY SOURCE Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total 5,000 55,000 50,000 75,000 3,000 8,000 6,500 7,000 7,000 40,000 50,000 100,000 8,000 8,000 178,000 157,000 5,400 2,000 2,500 2,500 60,000 14,000 75,000 15,000 3,000 15,000 5,000 55,000 50,000 75,000 3,000 3,000 8,000 20,500 40,000 50,000 100,000 10,000 24,000 100,000 178,000 157,000 5,400 7,000 60,000 14,000 75,000 15,000 402 - Park Improvements Total 133,000 343,500 118,000 121,000 194,500 19,000 128,400 91500 31000 1,069,900 Thursday, January 09, 2014 402 - Park Improvements Gideon Glen Signage & Parking Lot P0003 5 15,000 Freeman Plaza P0100 5 Freeman North Playground P0102 4 Equipment Freeman Parking Lot w/ MCWD P0103 5 Freeman Ball Field Lights P0104 5 Freeman Picnic Shelter Re -Roof P0105 4 Freeman Park - Eddy Station P0108 4 Freeman - Waterline for Community P0111 4 Garden Cathcart Park - Resurface P0200 Tennis /Basketball Courts Cathcart Park Hockey Boards P0201 3 Cathcart Park Tot Lot P0202 5 Cathcart Parking Lot P0203 5 Badger Park - Creek Crossing P0300 3 10,000 Badger Park Tennis Courts P0301 2 8,000 Badger Park Field Improvements P0302 n/a 100,000 Badger Park Parking & Road P0303 2 Badger Park Amenities P0304 2 Manor Park - Shelter Outside Floor & P0402 Stoops Silverwood Park - Resurface 1/2 court P0500 2 Silverwood Park Equipment P0501 3 Silverwood Park Swing Set P0502 3 Skate Park Rehab P0600 3 Skate Park Picnic Shelter P0601 5 5,000 55,000 50,000 75,000 3,000 8,000 6,500 7,000 7,000 40,000 50,000 100,000 8,000 8,000 178,000 157,000 5,400 2,000 2,500 2,500 60,000 14,000 75,000 15,000 3,000 15,000 5,000 55,000 50,000 75,000 3,000 3,000 8,000 20,500 40,000 50,000 100,000 10,000 24,000 100,000 178,000 157,000 5,400 7,000 60,000 14,000 75,000 15,000 402 - Park Improvements Total 133,000 343,500 118,000 121,000 194,500 19,000 128,400 91500 31000 1,069,900 Thursday, January 09, 2014 Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total Thursday, January 09, 2014 403 - Equipment Replacement Fund UTV - replace unit 34 034 5 20,000 20,000 Tractor - Ford 3910 035 5 54,000 54,000 Flatbed - 4 x 2 Replace unit 49 049 5 44,000 44,000 Loader - Cat 930H 056 5 250,000 250,000 Trailer 18' replace unit 59 059 5 15,000 15,000 Sand Pro 3000 - replace Unit 64 064 2 13,000 13,000 Trailer 12' replace unit 69 069 5 5,000 5,000 Dump Truck - replace unit 72 072 5 170,000 170,000 Groundsmaster Mower- Toro 328D - 075 2 31,000 31,000 replace unit 75 Pickup 44 - Replace Unit 78 078 3 35,000 35,000 Pickup - 350 44 replace unit 81 081 5 42,000 42,000 Mower - Replace Unit 86 086 4 26,000 32,000 58,000 Pickup 350 44 - replace unit 91 091 5 50,000 50,000 Groundsmaster Mower replace unit 093 5 28,000 28,000 93 Plow and Sander - One Ton Dump 094 5 155,000 155,000 Skid Steer - replace unit 97 097 5 55,000 55,000 Boom Truck 100 5 84,000 84,000 Chipper 101 5 45,000 45,000 Blower for Groundsmaster - replace A01 3 6,500 6,500 A01 Cab for mower - replace A02 A02 3 8,000 8,000 Cab for mower - replace A04 A04 4 7,000 7,000 Mower - Rear A05 5 13,000 13,000 Flail Mower - Side A06 5 17,000 17,000 Blower for Groundsmaster - replace A08 3 9,000 9,000 A08 Engine /Transmission Analysis Station A09 n/a 4,000 4,500 5,000 13,500 Replace Sander A10 3 14,000 14,000 South Shore Community Center PF -11 -01 n/a 2,500 43,000 41,000 2,000 88,500 Public Works Building PF -12 -01 n/a 10,000 81,000 91,000 Color Copier Replacement T -13 -03 2 10,000 10,000 Technology Upgrades T -14 -01 2 21,500 21,500 Computer Upgrades T -99-99 1 15,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 105,000 - Equipment Replacement Fund Total 327,000 296,000 141,500 193,000 68,500 44,000 96,000 117,000 15,000 260,000 1,558,000 Thursday, January 09, 2014 Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total Thursday, January 09, 2014 404 - Street Reconstruction Fund Elbert Point LR -13 -01 3 27,000 27,000 KcKinley Circle LR -13 -02 3 21,000 21,000 Valleywood Circle & Lane LR -13 -06 3 601,000 601,000 Charleston Circle LR -14 -01 4 36,000 36,000 Club Valley Road LR -14 -02 4 29,000 29,000 Lake Virginia Drive LR -14 -03 4 63,000 63,000 Radisson Entrance LR -14 -04 4 33,000 33,000 Sunnyvale Lane LR -14 -06 4 228,000 228,000 Timber Lane LR -14 -07 4 55,000 55,000 Chaska Road LR -15 -01 5 87,000 87,000 Mayflower Road LR -15 -02 5 33,000 33,000 McKinley Court LR -15 -03 5 40,000 40,000 Murray Hill Road LR -15 -04 5 52,000 52,000 Star Circle & Lane LR -15 -05 5 453,000 453,000 Summit Avenue LR -15 -06 5 32,000 32,000 Amlee Road LR -16 -01 5 332,000 332,000 Garden Road LR -16 -02 5 42,000 42,000 Gillette Curve LR -16 -03 5 35,000 35,000 Manitou Lane LR -16 -04 5 317,000 317,000 McKinley Place N & S LR -16 -05 5 65,000 65,000 Shady Hills Circle LR -16 -06 5 51,000 51,000 Echo Road LR -17 -01 5 71,000 71,000 Howards Point Road LR -17 -02 5 180,000 180,000 Kathleen Court LR -17 -03 5 22,000 22,000 Oak Ridge Circle LR -17 -04 5 29,000 29,000 Riviera Lane LR -17 -05 5 371,000 371,000 Shorewood Lane LR -17 -06 5 423,000 423,000 Mann Lane LR -18 -01 5 444,000 444,000 Maple Street LR -18 -02 5 100,000 100,000 Bayswater Road LR -19 -01 5 100,000 100,000 Boulder Circle LR -19 -02 5 49,000 49,000 Christmas Lane W LR -19 -03 5 32,000 32,000 Lilac Lane LR -19 -05 5 46,000 46,000 Strawberry Lane LR -19 -06 5 85,000 85,000 Vine Street LR -19 -07 5 33,000 33,000 Birch Bluff Road LR -20 -01 5 107,000 107,000 Thursday, January 09, 2014 Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total Excelsior Blvd LR -20 -02 5 19,000 19,000 Seamans Drive LR -20 -03 5 629,000 629,000 West Lane LR -20 -04 5 32,000 32,000 Christmas Lane E LR -21 -01 5 21,000 21,000 Christmas Lake Road LR -21 -02 5 107,000 107,000 Country Club Road LR -21 -03 5 95,000 95,000 Chestnut Court & Chestnut Terrace LR -22 -01 5 58,000 58,000 Murray St LR -22 -02 5 82,000 82,000 Rampart Ct LR -22 -03 5 24,000 24,000 Silver Lake Trail LR -22 -04 5 47,000 47,000 Smithtown Circle LR -22 -05 5 25,000 25,000 Shady Island Circle, Point & Road LR -23 -01 5 116,000 116,000 Shady Island Trail LR -23 -02 5 128,000 128,000 Sylvan Lane LR -23 -03 5 28,000 28,000 Wild Rose Lane E & W LR -23 -04 5 842,000 842,000 Street Sign Replacement LR -99 -001 2 6,600 6,900 75200 7,500 7,800 8,100 8,400 8,700 9,000 70,200 Maintenance - Bituminous Sealcoating LR -99 -100 1 270,000 228,000 245,000 184,000 238,000 305,000 274,000 255,000 248,000 275,000 2,522,000 X04 - Street Reconstruction Fund Total 11369,600 931,900 11094,200 1,287,500 789,800 658,100 11069,400 486,700 493,000 11389,000 9,569,200 405 - MSA Road Reconstruction Fun Smithtown -West Border to Regional T002 1 348,904 348,904 Sidewalk Galpin Lake Rd Sidewalk T003 1 211,567 208,567 420,134 VISA Road Reconstruction Fund Total 560,471 208,567 769,038 406 - Trails Galpin Lake Rd Sidewalk T003 1 259,966 259,966 Smithtown from Co Rd 19 to T006 1 703,500 703,500 Regional Trail Excelsior Blvd - Greenwood to T016 1 180,000 180,000 Barrington 406 - Trails Total 439,966 703,500 1,143,466 601 - Water Fund Air Compressor - Replace unit 38 038 3 12,000 12,000 Dump Truck - replace unit 65 065 3 165,000 165,000 Utility Truck w /crane & toolbox 076 5 77,000 77,000 replace unit 76 Thursday, January 09, 2014 Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total Utility Vehicle - replace unit 77 077 4 26,000 26,000 Pick -up - 4 x 4150 Replace Unit 80 080 5 35,000 35,000 Water Main - Star Circle & Lane w -11 -02 n/a 130,000 130,000 Water Main - Sunnyvale Lane W -13 -02 n/a 100,000 100,000 W. Water Tower - Rehab & Painting W- -13 -03 3 450,000 450,000 601 - Water Fund Total 715,000 254,000 26,000 995,000 5 Galpin Lake Rd Trail Stormwater SS003 1 226,700 Smithtown Road Trail Stormwater 611 - Sanitary Sewer Fund Sewer Jetter - replace unit 60 060 5 STM -12 -05 51,000 51,000 Dump Truck - Replace Unit 68 068 2 165,000 Valleywood Circle & Lane - Drainage STM -12 -08 165,000 Radio /ISP Communications - Lift SS -10 -10 1 10,000 4 70,000 Sunnyvale Lane Drainage 10,000 Station Retrofit Club Valley Drainage STM -14 -01 4 101,000 6120 Riviera Drainage - WSB Report Lift Station 11 Rehab - 20465 SS -13 -01 3 180,000 Star Circle & Lane STM -15 -01 180,000 Radisson Rd. STM -15 -02 5 Lift Station 9 Rehab - 20995 SS -14 -01 3 120,000 120,000 Minnetonka Blvd Lift Station 10 Rehab - 4773 SS -15 -01 3 80,000 80,000 Lakeway Terrace Lift Station 20 Rehab - 26550 Noble SS -16 -01 3 70,000 70,000 Road Lift Station 7 Rehab - 5600 SS -16 -02 3 80,000 80,000 Woodside Road Lift Station 18 Rehab - 4996 Shady SS -17 -01 3 10,000 10,000 Island Point Infiltration and Inflow Reduction SS -99 -05 1 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 700,000 611 - Sanitary Sewer Fund Total 545,000 150,000 271,000 80,000 70,000 70,000 70,000 70,000 70,000 70,000 1,466,000 45,000 45,000 226,700 234,500 234,500 24,000 142,000 70,000 192,000 101,000 19,000 31,000 31,000 50,000 50,000 50,000 150,000 Thursday, January 09, 2014 631 - Stormwater Management Fund 4" pump replace unit 50 050 5 Galpin Lake Rd Trail Stormwater SS003 1 226,700 Smithtown Road Trail Stormwater SS006 1 Lake South Auto Drainage - WSB STM -12 -05 3 24,000 Report Valleywood Circle & Lane - Drainage STM -12 -08 4 142,000 Shorewood Lane Ditch STM -13 -01 4 70,000 Sunnyvale Lane Drainage STM -13 -02 4 192,000 Club Valley Drainage STM -14 -01 4 101,000 6120 Riviera Drainage - WSB Report STM -14 -04 3 19,000 Star Circle & Lane STM -15 -01 5 Grant Lorenz STM -15 -02 5 45,000 45,000 226,700 234,500 234,500 24,000 142,000 70,000 192,000 101,000 19,000 31,000 31,000 50,000 50,000 50,000 150,000 Thursday, January 09, 2014 Source # Priority 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total 23350 Academy Drainage STM -15 -04 4 75,000 75,000 Garden Road STM -15 -05 4 26,000 26,000 Amlee /Glen Road STM -16 -01 4 381,000 381,000 Manitou Lane STM -16 -02 4 75,000 75,000 Riveria Lane STM -17 -01 4 87,000 87,000 Shorewood Lane STM -17 -02 4 99,000 99,000 Mann Lane STM -18 -01 4 105,000 105,000 Maple St STM -18 -02 4 24,000 24,000 Seamans Drive STM -20 -01 4 148,000 148,000 Rampart Ct. Drainage STM -22 -01 1 11,880 11,880 Stormwater Management Fund Total 774,700 416,500 506,000 236,000 129,000 193,000 11,880 2,267,080 GRAND TOTAL 4,864,737 3,303,967 2,156,700 1,917,500 1,251,800 791,100 1,556,800 683,200 592,880 1,719,000 18, 837, 684 Thursday, January 09, 2014 #3 MEETING TYPE City of Shorewood Council Meeting Item Work Session Title / Subject: Rate Study Discussion Meeting Date: January 13, 2014 Prepared by: Bill Joynes, City Administrator Bruce DeJong, Finance Director Attachments: Rate Study Presentation Utility Rate Study Model Policy Consideration: Should the City of Shorewood modify the rates for Sewer and Storm Water enterprise funds for 2014? Background: Staff worked with Ehlers to model rates for two enterprise funds. We need to raise rates to keep up with cost increases, particularly the Metropolitan Council Environmental Services (MCES) costs for collecting and treating sewage, along with new projected costs related to storm water management. Both the Sewer and Storm Water funds have reasonable fund balances and no debt. The cash balance of each fund has been dropping over the past several years. The anticipated uses of the new money raised through rate increases will go to new projects planned in the next five years, support transfers to the Trail fund, and meet increased costs of existing expenditures for staffing, utilities, and professional services. Storm Water Ehlers proposed the following rates for Storm Water: Quarterly Storm Water Rates Note: 1,944 out of 2,961 ( or 67%) of Storm Water accounts are charged the middle Residential rate. These rates increase at 20% for five years. This will allow us to meet our target cash balance for working capital at the end of 2018 as shown below. Existing 2013 Proposed Quarterly Rates 2014 2015 2016 2017 2018 Flat Rates Residential Res. < 10,000 sq. ft. 10.59 12.71 15.25 18.30 21.96 26.35 Res. > 10,000 & < 50,000 sq. ft. 15.12 18.14 21.77 26.13 31.35 37.62 Res. > 50,000 sq. ft. 19.68 23.62 28.34 34.01 40.81 48.97 Commercial Commercial / Industrial (Average Charge) 40.24 48.29 57.95 69.53 83.44 100.13 Note: 1,944 out of 2,961 ( or 67%) of Storm Water accounts are charged the middle Residential rate. These rates increase at 20% for five years. This will allow us to meet our target cash balance for working capital at the end of 2018 as shown below. t t Storm Sewer Fund Capital Cash Reserves 70D,000 BOD,000 50D,000 40D,000 30D,000 20D,000 106,D0D 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 ■ Target working capital OActual working capital Ehlers also reviewed the possibility of a larger increase in the rates as suggested by council members. Instead of an approximately $3 increase in rates, they modeled a $6 initial rate increase followed by 15% increases. That would actually allow us to exceed our target working capital by 2018. Alternative rate proposal: DuarterIv Storm Water Rates Note: 7,944 out of 2,90 7 ( or 01%) of Storm Water ac.Gounts are Charged the middle Residential rare. Note: for 2014, the equivalent rate increase for Cornmercial is 40%. Existing 2013 Proposed Quarterly Rates 2014 2015 2016 2017 61 0tr. 15.00% 15.00% 15.00% 15.00% Flat Rates Residential Res- r 10,000 sq- ft. 10 -59 16 -59 19-081 21 -94 25 -23 29 -02 Res- sq- Res. > 50,000 sq. ft. 1968 2568 29.53 33.96 39.06 4491 Commercial Commercial / Industrial (Average Charge) 4024 56 -34 64 -79 74 -50 85 -68 98 -53 Usage Rates All Usage, per 1,000 gallons NIA NJA NIA NIA NIA NIA Note: 7,944 out of 2,90 7 ( or 01%) of Storm Water ac.Gounts are Charged the middle Residential rare. Note: for 2014, the equivalent rate increase for Cornmercial is 40%. Alternate working capital: 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 Storm Water Fund Capital Cash Reserves 2010 2011 2012 2013 2014 2015 201G 2017 2018 ■Target working capital DActual worxing capital Staff is not recommending this option because we have some significant question on how much storm water effort will be required. If we do not reconstruct Eureka Road North to MSA standards that saves $452,000. That storm water project was removed because we are no longer planning the same level of road reconstruction. Since that is such a huge project there may be some justification to keep the rates lower initially. We can plan to revisit the rate study after we have a couple of years experience under our belt and a better handle on any new federal or state standards we may have to meet. Sewer Ehlers discussed the significant options available for sewer users. In order to maintain the targeted cash reserves, they recommend a 3% annual increase. How we get there is subject to considerable variation. They analyzed three scenarios: • We could maintain a flat sewer rate for all residential users. • We could charge users with metered water usage a low fixed base fee and a variable charge for each 1,000 gallons used during the year. • We could charge users with metered water usage a low fixed base fee and a variable charge for each 1,000 gallons used during the winter quarter. This is the most typical arrangement for municipal systems in Minnesota. Each option keeps the flat charge the same amount as the average water user under the charge per 1,000 gallons alternatives. Staff analyzed with Ehlers other alternate methods that would provide a discount to non - metered residents, but could not come up with a method that would keep non - metered fees at the same average price as metered customers. The flat usage does not reward, and in fact penalizes, low water users. The challenge is that we don't meter half of the city. In order for those not on city water to take advantage of the potential for lower rates they would need to install a city water meter. This would allow them to potentially save a significant amount each quarter, but the cost of installing a water meter with a licensed plumber could be high - up to $1,000 depending on their existing plumbing situation with their well and water lines. That is a lot of up -front cost for a variable quarterly savings. The charge for all gallons used during the year is challenging because most residents with city water only have one meter. This covers the water that is used inside the home and flows through the sewer system, but also covers all water used outside during the warmer months of the year. That would include washing cars, watering flowers and grass, and other uses. The water pumped in municipal systems during the summer typically goes up to about 250 -300% of winter water use. Most of that water is not going down the sewer, but the users are being charged as if it were. There is also significant variability in the amount of landscape watering from year to year as we swing from near - drought to monsoon conditions. The winter quarter usage captures peoples water flow at what is typically the lowest point in the year. This method would require a higher rate than the full year usage. It has the benefit of being easier for residents to budget and is a more predictable city revenue stream year to year. The disadvantage is that users with high usage may see an increase in their bill above the flat rate unmetered users. This is one of the consequences of going to a conservation mindset, but helps with the sustainability of our natural resources. Sewer Fund - Customer Rate options Q arterly Sanitary Sewer Rates The recommendation for commercial properties is to keep them on a similar system. These properties currently are required to be metered and are charged for each 1,000 gallons used throughout the year. Staff recommends that they stay on this system, with the rates calculated by Ehlers for year -round usage. This is a lower per 1,000 gallon rate than residential users, but it captures their entire usage for the year. We have also included a minimum which is equal to the residential minimum. No commercial property will pay less than an unmetered residential user. Financial or Budget Considerations: These rates are feasible and support the long range sustainability of the funds. Existing 2013 Proposed Quarterly Rates 2014 2015 2016 2017 2018 3.00% 3.00% 3.00% 3.00% 3,00% Fixed Charge Residential Residential 70.00 8.25 8.50 8.75 9.01 9.29 Low Income -Sewer Only 46.66 48.57 50.03 51.53 53.07 54.67 Sewer Only 70.00 72.85 75.04 7729 79.81 81.99 Commercial Commercial 70.00 825 8.50 8.75 9.01 9.29 Usage Rates Residential - Option 91 0.00 1.90 1.96 2.02 2.06 2.14 Residential - Option #2 0.00 3.40 3.50 3.61 3.72 3.83 Commercial 0.00 1.90 1.96 2.02 2.08 2.14 The recommendation for commercial properties is to keep them on a similar system. These properties currently are required to be metered and are charged for each 1,000 gallons used throughout the year. Staff recommends that they stay on this system, with the rates calculated by Ehlers for year -round usage. This is a lower per 1,000 gallon rate than residential users, but it captures their entire usage for the year. We have also included a minimum which is equal to the residential minimum. No commercial property will pay less than an unmetered residential user. Financial or Budget Considerations: These rates are feasible and support the long range sustainability of the funds. Options: The City Council is encouraged to discuss the rate structures with staff. Recommendation/ Action Requested: Staff recommends that the City Council finalize these rates for adoption at the regular meeting later this evening. Next Steps and Timelines: The rates will be on the regular agenda for adoption. Communication with residents will continue prior to implementation later this year. Connection to Vision / Mission: Adopting a prudent rate structure contributes to sound financial management. 10/24/2013 Overview • Both sewer and storm water have solid fund balances and no outstanding debt • The City has placed a high priority on trails projects • The City is planning significant capital projects over the next five years: — $1.5M for Sewer Fund — $750,000 transfer from Sewer Fund to assist Trails & Storm Water Funds — $2.3M for Storm Water Fund • Existing sewer rate is a flat rate, regardless of water usage • Storm water rate is low compared to other communities • City has an agreement with the City of Excelsior for a shared sewer trunk line IVV EHLERS Storm Water Fund • Net assets stable, but cash is decreasing over last three years — Cash balances down from $650K in 2009 to $100K estimated 2013 year end • More than $550K spent on capital projects in last three years • Current rates able to pay for operating costs, but not future capital • Capital projects through 2018: — $100K in equipment replacement — $460K in trails projects — $1.74M in storm water projects 3 IVV 19 EHLERS Storm Water Fund • Goals — Pay for capital projects per the current CIP — Achieve and maintain Targeted Fund Balance • 50% of Operating Costs • 100% Depreciation Expense • 100% of next years debt (if applicable) — No external debt 4 EHLERS 10/24/2013 PJ Storm Water Fund How to pay for capital projects? Increase Storm Water Rates Internal borrowing from Sewer Fund Current Rates Residential < 10K sq. ft $10.59 /quarter Residential >10K & <50K sq. ft $15.12 /quarter Residential > 50k sq. ft. $19.68 /quarter Commercial Varies Note: 1,944 out of 2,961 (or 67%) of Storm Water accounts are charged the middle Residential rate. 120 Inter fund loan would be repaid to the Sewer Fund over time • Annual Amounts • $450k in 2014 • $150k in 2015 • $450k in 2016 • $150k in 2014 • 15 years • 4% interest EHLERS Storm Water Fund — Recommended Rate Increases 2013 Quarterly Storm Water Rates Rates 2014 2015 2016 Existing Proposed Quart Flat Rates Residential Res. < 10,000 sq. ft. 10.59 12.71 15.25 18.30 21.96 26.35 Res. > 10,000 & < 50,000 sq. ft. 15.12 18.14 21.77 26.13 31.35 37.62 Res. > 50,000 sq. ft. 19.68 23.62 28.34 34.01 40.81 48.97 Commercial Commercial /Industrial (Average Charge) 40.24 48.29 57.95 69.53 83.44 100.13 Note: 1,944 out of 2, 961 (or 67%) of Storm Water accounts are charged the middle Residential rate. F 2014 rate increase 1 $3.02 / quarter For average residential customer 6 EHLERS 10/24/2013 3 2013 erly Rates 2014 2015 2016 2017 2018 Flat Rates Residential Res. < 10,000 sq. ft. 10.59 12.71 15.25 18.30 21.96 26.35 Res. > 10,000 & < 50,000 sq. ft. 15.12 18.14 21.77 26.13 31.35 37.62 Res. > 50,000 sq. ft. 19.68 23.62 28.34 34.01 40.81 48.97 Commercial Commercial /Industrial (Average Charge) 40.24 48.29 57.95 69.53 83.44 100.13 10/24/2013 3 G Storm Water Fund Projected Cash Balances Storm Sewer Fund Capital Cash Reserves 700,000 800,000 Decrease from 2010 500 000 to 2011 due to $400k in capital projects 400,000 300,000 200,000 100,000 0 2010 2011 2012 2013 2014 2015 2016 2017 0Taiget waking cal OAckial waling 018 ng capital J EHLERS Sewer Fund • Cash balances stable at over $3.5M for last three years • $2.990M (or 85 %) of reserves projected to be spent in next four years Transfers to Trail & Storm Water Funds $250,000 $500,000 $0 $0 Sewer Projects 550,000 150,000 250,000 90,000 Inter Fund Loan to Storm Water Fund * 450,000 150,000 450,000 150,000 Total $1,250,000 $800,000 $700,000 $240,000 * - Interfund loon to be repaid to Sewer Fund over 15 years of 4% interest 40% of costs to be repaid in 15 years by inter fund loan $110,000 / year by 2018 8 � EHLERS 10/24/2013 Il Sewer Fund Projected Cash Balances Sewer Fund Capital Cash Reserves Interfund Loans to Storm Water Two Transfers to Trails Fund 4,000,000 3,500,000 3,000,000 2,500,000 2.000.000 1,500,000 1,000,000 500,000 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 ■Target working capital oACtual woking capital 9 EHLERS Sewer Fund • Goals — Pay for capital projects per the current CIP — Achieve and maintain Targeted Fund Balance • 50% of Operating Costs • 100% Depreciation Expense • 100% of next years debt (if applicable) — Fund Storm Water and Trail Funds — No external debt 10 IVV EHLERS 10/24/2013 11 Sewer Fund • To maintain targeted cash reserves, we are recommending a 3% annual increase in sewer rates for all customers beginning in 2014 — Targeted cash reserve: 50% of current year operating costs + 100% depreciation expense — Rate increase is consistent with projected increases in operating costs of 3% per year • Repayment of interfund loan from the Storm Water Fund helps keep rate increases low 19 EHLERS Sewer Fund — Rate Structure Options • City asked Ehlers to evaluate changing sewer fund rate structure to account for those customers on both City water and sewer — 1,289 sewer customers also have City water • 1,256 are residential • 33 are commercial • Two possible rate structure options: — Option #1: Fixed Fee + User Charge based on actual water usage 12 IVV — Option #2: Fixed Fee + User Charge based on winter water usage EHLERS 10/24/2013 " Sewer Fund — Why Change Rate Structure? PROS CONS • Fairness: Customers pay sewer based Not all water usage goes "down the on actual water used drain" • Lawn sprinkling • "Winter averaging" caps sewer usage at Car washing 11t quarter water usage for each Swimming pools customer • Assumes water usage is all indoors; • Users not on City water cannot • Applies only to residential measure sewer usage customers. Commercial customers have separate irrigation meters for outdoor use • Those customers with lower water Those customers with higher water usage will see decreases in their sewer usage will see increases in their sewer bills bills 19 EHLERS Sewer Fund — Option #1 • Fixed Charge: Allows City to cover fixed costs of the system — 2012 Personal Services costs = $95,000 /year — Equates to $8.25 / customer / quarter • Usage Charge: Covers all other operating and capital costs of the system — 159,758,000 gallons of water used by sewer customers in 2012 — Equates to $1.90 / 1,000 gallons for all customers with City water • Non -Water Users: Based on average water usage — City average is 34,000 gallons / quarter — Total sewer bill would be $72.85 / quarter 14 EHLERS 10/24/2013 7 Sewer Fund — Option #2 • Fixed Charge: Same as Option #1 • Usage Charge: Sewer consumption would be based on water usage in the winter quarter for residential users — 93,929,566 gallons of water capped at the winter quarter usage — Assumes that water usage in the summer months for lawn sprinkling, etc. does not go into the sanitary sewer system — Equates to $3.40 / 1,000 gallons for residential customers — Equates to $1.90 / 1,000 gallons for commercial customers • Non -Water Users: Based on average water usage — City winter average is 19,000 gallons / quarter — Total sewer bill would be $72.85 / quarter cio IS EHLERS Sewer Fund — Average Water Usage City of Shorewood Average 2012 Water Usage by Quarter 60,000 50,000 40,000 30,000 20,000 10,000 SstQtr 2ndQtr 3rd Qtr 4th Qtr OAverage Water Usage O Winte r Average Water Usage 6 EHLERS , 10/24/2013 Sewer Fund - Customer Rate Options Proposed Quarterly Rates Quarterly Sanitary Sewer Rates 2016 2017 2018 Commercial 3.00% 3.00% 3.00% 3.00% 3.00 Fixed Charge 72.85 Residential Residential 70.00 8.25 8.50 8.75 9.01 9.29 Low Income -Sewer Only 46.66 48.57 50.03 51.53 53.07 54.67 Sewer Only 70.00 72.85 75.04 77.29 79.61 81.99 Commercial Commercial 70.00 8.25 8.50 8.75 9.01 9.29 Usage Rates Residential - Option #1 0.00 1.90 1.96 2.02 2.08 2.14 Residential - Option #2 0.00 3.40 3.50 3.61 3.72 3.83 Commercial 0.00 1.90 1.96 2.02 2.08 2.14 17 + EHLERS Sewer Fund - Impact Analysis Customer Current Rates Option #1 OF Residential 10% 7,000 gallons /quarter (summer) $70.00 $21.55 N/A 4,000 gallons / quarter (capped) N/A $21.85 80% 34,000 gallons / quarter (summer) 70.00 72.85 N/F 19,000 gallons / quarter (capped) N/A 72.8E 61,000 gallons /quarter (summer) Existing 2013 Proposed Quarterly Rates 10% 2014 2015 2016 2017 2018 Commercial 3.00% 3.00% 3.00% 3.00% 3.00 Fixed Charge 72.85 Residential Residential 70.00 8.25 8.50 8.75 9.01 9.29 Low Income -Sewer Only 46.66 48.57 50.03 51.53 53.07 54.67 Sewer Only 70.00 72.85 75.04 77.29 79.61 81.99 Commercial Commercial 70.00 8.25 8.50 8.75 9.01 9.29 Usage Rates Residential - Option #1 0.00 1.90 1.96 2.02 2.08 2.14 Residential - Option #2 0.00 3.40 3.50 3.61 3.72 3.83 Commercial 0.00 1.90 1.96 2.02 2.08 2.14 Sewer Fund - Impact Analysis Customer Current Rates Option #1 OF Residential 10% 7,000 gallons /quarter (summer) $70.00 $21.55 N/A 4,000 gallons / quarter (capped) N/A $21.85 80% 34,000 gallons / quarter (summer) 70.00 72.85 N/F 19,000 gallons / quarter (capped) N/A 72.8E 61,000 gallons /quarter (summer) 70.00 124.15 N/A 10% 34,000 gallons /quarter (capped) N/A 123.85 Commercial 50% 90,000 gallons /quarter 70.00 179.25 179.25 Non -Water User 70.00 72.85 72.85 Both options are "revenue neutral" and incorporate the 3% rate increase for 2014 no EH,LERS 10/24/2013 Sewer Fund • Policy Discussion — Both options generate same amount of revenue — Consistency with sewer bills throughout year • Option #1: More fluctuation in bills between winter and summer • Option #2: Customers 15t quarter usage caps sewer consumption for rest of year — Option #2: Sewer bills more stable throughout the year. Easy for customers to budget. 19 1 _, Excelsior Contract 19 EHLERS • Contract for joint usage of Glencoe Road sanitary trunk sewer line in 1971 — Total cost was $42,360 in 1971 dollars, of which Shorewood paid half • Shorewood annually pays Excelsior joint use sanitary sewer service rental fees based on: — Budgeted collection costs, depreciation and administrative costs ?O IVV — Proportionate share of estimated wastewater flows into Excelsior per MCES EHLERS 10/24/2013 10 Excelsior Contract • Potential discussion points with the City of Excelsior: — No reconciliation of budgeted costs to actual costs — Depreciation is based on entire City of Excelsior and not just Glencoe Road trunk sewer line • Currently paying $30,000 /year to Excelsior • Could save City of Shorewood $7,500 /year based on following assumptions: — Value of Glencoe Rd. fixed asset = purchase price in 1971 — Life of the fixed asset is 50 years — Asset is depreciated by the same amount each year — Asset will be fully depreciated by 2021 21 EHLERS LEADERS IN PUBLIC FINANCE Stacie Kvilvang Senior Financial Advisor (651) 697 -8506 skvilvang @ehlers - inc.com zz . 19 EHLERS Jason Aarsvold Financial Advisor (651) 697 -8512 jaarsvold @ehlers - inc.com ■ . 10/24/2013 11 City of Shorewood Utility Rate Study Base Model 1 Rates Inflation Actual 2 Revenue growth assumption - non -usage Budget 3 Investment income yield 4 Expense growth - general and administrative 5 Expense growth - contractual 6 Expense growth - non personnel 10 Beginning net assets 11 2011 12 Operating Revenues 2013 14 Sewer charges 2015 15 Storm Sewer Charges 2017 15 Revenue Due to Growth 2019 16 Total Operating Revenues 2021 17 2023 18 Operating Expenses 19 Personal Services 0.00% 20 Supplies 3.00% 21 Repairs and maintenance 3.00% 22 Depreciation 3.00% 23 Professional Services 3.00% 24 Contracted Services 3.00% 25 Insurance 26 Utilities 2.00% 27 Disposal Charges 2.00% 28 Other 2.00% 29 Total Operating Expenses 2.00% 30 2.00% 31 Net Operations 2.00% 32 Non operating revenues (expenses) 33 Special Assessments 1.25% 34 Interest income 1.25% 35 Other Income 1.25% 36 Interest and Other Expenses 1.25% 37 Connection Fees 1.25% 38 Transfers in 1.25% 39 Transfers out 40 Total non operating revenue (expenses) 3.00% 41 3.00% 42 Net increase (decrease) in resources 3.00% 43 3.00% 44 Ending net assets 3.00% 45 CIP Funding 3.00% 46 Purchase of Capital Assets 47 Interfund Loan 3.00% 48 IFL P &I - Future 15 Years 4% 49 IFL P &I - Future 15 Years 4% 50 IFL P &I - Future 15 Years 4% 51 IFL P &I - Future 15 Years 4% 52 IFL P &I - Future 15 Years 4% 53 IFL P &I - Future 15 Years 4% 54 2.00% 55 Bond Prin - Existing 2.00% 56 2.00% 57 Beginning Cash 2.00% 58 Add net operations (line 29) 2.00% 59 Add back depreciation (line 26) 2.00% 60 Add net non operating (line 40) 5,705,107 61 Add capital and bond (lines 55 -52) 5,198,487 62 Net change in balance sheet items 4,764,340 64 Ending Cash 3,985,242 65 Other investments 3,683,931 66 Ending net assets 3,362,059 67 69 Target minimum working capital 70 Actual working capital -cash balance 71 Over (Under) target working capital Sewer Fund 10/23/2013 0FREERS Actual Budget Projected 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 0.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 5.741.797 5,705,107 5,400,530 5,198,487 5,119,156 4,764,340 4,122,242 3,985,242 3,837,153 3,683,931 3,526,248 3,362,059 3,193,208 3,019,517 840.413 818.296 828,490 829,010 835.016 860.067 885.869 912.445 939,818 968.013 997.053 1.026.965 1,057,773 1,089,507 840,413 818.296 828,490 829,010 835.016 860.067 885,869 912,445 939,818 968.013 997.053 1.026.965 1,057,773 1,089,507 69,729 99,995 94,617 93,274 96,072 98,954 101,923 104,981 108,130 111,374 114,715 118,157 121,701 125,352 2,311 3,044 1,970 9,260 9,538 9,824 10,119 10,422 10,735 11,057 11,389 11,730 12,082 12,445 40,283 31,562 12,149 15,000 15,300 15,606 15,918 16,236 16,561 16,892 17,230 17,575 17,926 18,285 218,483 214,247 221,214 225,000 231,750 238,703 245,864 253,239 260,837 268,662 276,722 285,023 293,574 302,381 6,884 0 14,510 13,750 14,163 14,587 15,025 15,476 15,940 16,418 16,911 17,418 17,941 18,479 31,825 42,521 10,230 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 25,335 26,095 26,878 5,225 0 773 6,500 6,695 6,896 7,103 7,316 7,535 7,761 7,994 8,234 8,481 8,735 9,725 10,625 8,700 6,000 6,180 6,365 6,556 6,753 6,956 7,164 7,379 7,601 7,829 8,063 594,273 744,098 702,206 560,386 578,214 595,560 613,427 631,830 650,785 670,308 690,418 711,130 732,464 754,438 1,435 5.534 443 7,050 7,262 7,479 7,704 7,935 8,173 8,418 8,671 8,931 9,199 9,475 980,173 1.151.626 1.065,926 956,220 985,773 1,015,193 1,045,493 1,076,699 1,108,837 1,141,937 1,176,026 1,211,134 1,247,293 1,284,532 (139,760) (' 33,330) (237,436) (127,210) (150,757) (155,127) (159,624) (164,254) (169,019) (173,924) (178,973) (184,170) (189,519) (195,025, 0 0 0 0 0 0 0 0 0 0 0 0 0 0 38,440 27,553 29,843 43,934 41,945 27,452 19,079 12,513 12,035 12,367 10,794 11,209 11,595 11,948 2,230 1,200 3,150 3,245 3,342 3,442 3,545 3,652 3,761 3,874 3,990 4,110 4,233 4,360 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,400 2,400 700 60,000 0 (249,345) (517,866) 103,070 28,753 35,393 47,878 204,058 486,972 22,625 16,165 15,797 16,241 14,784 15,319 15,828 16,308 36,690 304,577 202,043 79,331 354,815 642,098 136,999 148,089 153,222 157,683 164,189 168,850 173,691 178,717 5,705,107 5,400,530 5,198,487 5,119,156 4,764,340 4,122,242 3,985,242 3,837,153 3,683,931 3,526,248 3,362,059 3,193,208 3,019,517 2,840,800 (123,479) (190,013) (22,015) (304,800) (561,350) (159,135) (240,400) (90,041) (191,280) (197,019) (202,929) (209,017) (215,288) (221,746) (475,000) (150,000) (450,000) (150,000) 0 (150,000) 0 0 0 0 42,722 42,722 42,722 42,722 42,722 42,722 42,722 42,722 42,722 13,491 13,491 13,491 13,491 13,491 13,491 13,491 13,491 40,473 40,473 40,473 40,473 40,473 40,473 40,473 13,491 13,491 13,491 13,491 13,491 13,491 0 0 0 0 0 13,491 13,491 13,491 13,491 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,666,489 3,776,321 3,544,245 3,514,714 3,355,583 2,196,167 1,526,358 1,001,036 962,832 989,344 863,482 896,754 927,579 955,843 (139,760) (333,330) (237,436) (127,210) (150,757) (155,127) (159,624) (164,254) (169,019) (173,924) (178,973) (184,170) (189,519) (195,025) 218,483 214,247 221,214 225,000 231,750 238,703 245,864 253,239 260,837 268,662 276,722 285,023 293,574 302,381 103,070 28,753 35,393 47,878 (204,058) (486,972) 22,625 16,165 15,797 16,241 14,784 15,319 15,828 16,308 (123,479) (190,013) (22,015) (304,800) (1,036,350) (266,413) (634,187) (143,354) (81,102) (236,841) (79,260) (85,348) (91,619) (98,077) 51.518 48.267 26,687 3,776,321 3,544,245 3,514,714 3,355,583 2,196,167 1,526,358 1,001,036 962,832 989,344 863,482 896,754 927,579 955,843 981,430 5,705,107 5,400,530 5,198,487 5,119,156 4,764,340 4,122,242 3,985,242 3,837,153 3,683,931 3,526,248 3,362,059 3,193,208 3,019,517 2,840,800 599,328 682,937 643,570 590,610 608,762 626,948 645,678 664,969 684,837 705,299 726,374 748,079 770,433 793,457 3,776,321 3,544,245 3,514,714 3,355,583 2,196,167 1,526,358 1,001,036 962,832 989,344 863,482 896,754 927,579 955,843 981,430 3,176,993 2,861,309 2,871,144 2,764,973 1,587,406 899,411 355,358 297,863 304,507 158,182 170,380 179,500 185,410 187,974 10/23/2013 0FREERS City of Shorewood Utility Rate Study Base Model 1 Rates Inflation Actual 2 Revenue growth assumption - non -usage Budget 3 Investment income yield 4 Expense growth - general and administrative 5 Expense growth - contractual 6 Expense growth - non personnel 10 Beginning net assets 11 2011 12 Operating Revenues 2013 14 Sewer charges 2015 15 Storm Sewer Charges 2017 15 Revenue Due to Growth 2019 16 Total Operating Revenues 2021 17 2023 18 Operating Expenses 19 Personal Services 0.00% 20 Supplies 20.00% 21 Repairs and maintenance 20.00% 22 Depreciation 0.00% 23 Professional Services 0.00% 24 Contracted Services 0.00% 25 Insurance 26 Utilities 2.00% 27 Disposal Charges 2.00% 28 Other 2.00% 29 Total Operating Expenses 2.00% 30 2.00% 31 Net Operations 2.00% 32 Non operating revenues (expenses) 33 Special Assessments 1.25% 34 Interest income 1.25% 35 Other Income 1.25% 36 Interest and Other Expenses 1.25% 37 Connection Fees 1.25% 38 Transfers in 1.25% 39 Transfers out 40 Total non operating revenue (expenses) 3.00% 41 3.00% 42 Net increase (decrease) in resources 3.00% 43 3.00% 44 Ending net assets 3.00% 45 CIP Funding 3.00% 46 Purchase of Capital Assets 47 Interfund Loan 3.00% 48 IFL P &I - Future 15 Years 4% 49 IFL P &I - Future 15 Years 4% 50 IFL P &I - Future 15 Years 4% 51 IFL P &I - Future 15 Years 4% 52 IFL P &I - Future 15 Years 4% 53 IFL P &I - Future 15 Years 4% 54 2.00% 55 Bond Prin - Existing 2.00% 56 2.00% 57 Beginning Cash 2.00% 58 Add net operations (line 29) 2.00% 59 Add back depreciation (line 26) 2.00% 60 Add net non operating (line 40) 1,739,820 61 Add capital and bond (lines 55 -52) 1,628,234 62 Net change in balance sheet items 1,933,127 64 Ending Cash 2,408,267 65 Other investments 2,890,783 66 Ending net assets 3,429,074 67 69 Target minimum working capital 70 Actual working capital -cash balance 71 Over (Under) target working capital Storm Sewer Fund 10/23/2013 EHLERS Actual Budget Projected 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 0.00% 20.00% 20.00% 20.00% 20.00% 20.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 1.25% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 1,661,495 1,739,820 1,706,737 1,628,234 1,650,838 1,933,127 2,263,268 2,408,267 2,613,146 2,890,783 3,163,824 3,429,074 3,688,723 3,944,830 190,819 189,013 186,943 186,960 224,352 269,223 323,067 387,680 465,217 465,217 465,217 465,217 465,217 465,217 190,819 189,013 186,943 186,960 224,352 269,223 323,067 387,680 465,217 465,217 465,217 465,217 465,217 465,217 22,737 44,715 57,611 35,601 36,669 37,769 38,902 40,069 41,271 42,509 43,785 45,098 46,451 47,845 2,581 3,565 1,685 4,400 4,532 4,668 4,808 4,952 5,101 5,254 5,411 5,574 5,741 5,913 33,475 88,004 30,030 35,500 36,210 36,934 37,673 38,426 39,195 39,979 40,778 41,594 42,426 43,274 19,833 25,250 32,314 33,283 34,282 35,310 36,370 37,461 38,585 39,742 40,934 42,162 43,427 44,730 9,848 29,632 19,783 11,000 11,330 11,670 12,020 12,381 12,752 13,135 13,529 13,934 14,353 14,783 40,871 41,752 131,488 50,000 51,500 53,045 54,636 56,275 57,964 59,703 61,494 63,339 65,239 67,196 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1,762 117 935 2,800 2,884 2,971 3,060 3,151 3,246 3,343 3,444 3,547 3,653 3,763 131,107 233,035 273,846 172,584 177,407 182,367 187,469 192,716 198,113 203,665 209,375 215,248 221,290 227,504 59,712 (44,022) (86,903) 14,376 46,945 86,855 135,598 194,964 267,103 261,552 255,842 249,968 243,927 237,712 7,651 6,957 6,988 7,198 7,414 7,636 7,865 8,101 8,344 8,594 8,852 9,118 9,391 9,673 5,637 3,882 1,412 1,031 1,230 1,150 1,536 1,814 2,189 2,895 557 563 2,789 4,794 5,325 100 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 226,700 234,500 18,613 10,939 8,400 8,229 235,343 243,286 9,401 9,915 10,533 11,490 9,409 9,680 12,181 14,467 78,325 33.083 78.503 22,604 282,288 330,141 144,999 204,879 277,636 273,041 265,250 259,649 256,107 252,179 1,739,820 1,706,737 1,628,234 1,650,838 1,933,127 2,263,268 2,408,267 2,613,146 2,890,783 3,163,824 3,429,074 3,688,723 3,944,830 4,197,010 (418,085) (110,901) (40,000) (797,941) (441,865) (552,920) (265,620) (149,546) (539,712) (182,021) 0 (15,501) 0 475,000 150,000 450,000 150,000 0 150,000 (42,722) (42,722) (42,722) (42,722) (42,722) (42,722) (42,722) (42,722) (42,722) (13,491) (13,491) (13,491) (13,491) (13,491) (13,491) (13,491) (13,491) (40,473) (40,473) (40,473) (40,473) (40,473) (40,473) (40,473) (13,491) (13,491) (13,491) (13,491) (13,491) (13,491) 0 0 0 0 0 (13,491) (13,491) (13,491) (13,491) 571,128 665,518 214,142 82,479 98,367 91,996 122,861 145,097 175,130 231,626 44,521 45,015 223,157 383,522 59,712 (44,022) (86,903) 14,376 46,945 86,855 135,598 194,964 267,103 261,552 255,842 249,968 243,927 237,712 19,833 25,250 32,314 33,283 34,282 35,310 36,370 37,461 38,585 39,742 40,934 42,162 43,427 44,730 18,613 10,939 8,400 8,229 235,343 243,286 9,401 9,915 10,533 11,490 9,409 9,680 12,181 14,467 0 (418,085) (110,901) (40,000) (322,941) (334,587) (159,133) (212,307) (259,724) (499,889) (305,690) (123,669) (139,170) (123,669) 3.768 25.458 25,427 665,518 214,142 82,479 98,367 91,996 122,861 145,097 175,130 231,626 44,521 45,015 223,157 383,522 556,762 1,739,820 1,706,737 1,628,234 1,650,838 1,933,127 2,263,268 2,408,267 2,613,146 2,890,783 3,163,824 3,429,074 3,688,723 3,944,830 4,197,010 75,470 129,143 153,080 102,934 148,566 165,052 208,606 225,266 228,527 245,372 248,824 252,374 256,028 259,786 665,518 214,142 82,479 98,367 91,996 122,861 145,097 175,130 231,626 44,521 45,015 223,157 383,522 556,762 590,048 85,000 (70,601) (4,567) (56,571) (42,191) (63,509) (50,137) 3,100 (200,852) (203,809) (29,217) 127,494 296,976 10/23/2013 EHLERS City of Shorewood Sanitary Sewer System Capital Improvement Program Actual CIP (2013 Dollars) 304,800 545,000 150,000 220,000 80,000 165,000 165,000 165,000 165,000 165,000 165,000 Percent Inflation 0% 3% 3% 3% 3% 3% 3% 3% 3% 3% 3% Inflated Project Costs 304,800 CAPITAL EQUIPMENT 159,135 240,400 90,041 191,280 197,019 202,929 209,017 215,288 221,746 Radio /ISP Communications - Lift Station Retrofit SS -10 -10 40,000 10,000 Dump Truck 068 165,000 PROJECTS Lift Station 11 Rehab - 20465 Radisson SS -13 -01 180,000 Lift Station 11 Force Main Separation SS -13 -02 194,800 Lift Station 9 Rehab - 20995 Minnetonka Blvd SS -14 -01 120,000 Lift Station 10 Rehab - 4773 Lakeway Terrace SS -15 -01 80,000 Lift Station 20 Rehab - 26550 Noble Road SS -16 -01 70,000 Lift Station 7 Rehab - 5600 Woodside Road SS -16 -02 80,000 Lift Station 18 Rehab - 4996 Shady Island Point SS -17 -01 10,000 Inflow & Infiltration Reduction SS -99 -05 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 Future capital 95,000 95,000 95, 0001 95,0001 95,000 95,000 Actual CIP (2013 Dollars) 304,800 545,000 150,000 220,000 80,000 165,000 165,000 165,000 165,000 165,000 165,000 Percent Inflation 0% 3% 3% 3% 3% 3% 3% 3% 3% 3% 3% Inflated Project Costs 304,800 561,350 159,135 240,400 90,041 191,280 197,019 202,929 209,017 215,288 221,746 10/23/2013 EHLERS City of Shorewood Storm Sewer System Capital Improvement Program Actual CIP (2013 Dollars) 40,000 774,700 416,500 506,000 236,000 129,000 452,000 148,000 0 11,880 0 Percent Inflation 0% 3% 3% 3% 3% 3% 3% 3% 3% 3% 3% Inflated Project Costs 40,000 CAPITAL EQUIPMENT 441,865 552,920 265,620 149,546 539,712 182,021 0 15,501 0 None PROJECTS Lake South Auto Drainage - WSB Report STM -12 -05 24,000 Valleywood Circle & Lane - Drainage STM -12 -08 142,000 Shorewood Lane Ditch STM -13 -01 70,000 Sunnyvale Lane Drainage STM -13 -02 192,000 Excelsior Blvd Drainage STM -13 -03 40,000 Club Valley Drainge STM -14 -01 101,000 6120 Riviera Drainage - WSB Report STM -14 -04 19,000 Star Circle & Lane STM -15 -01 31,000 Grant Lorenz STM -15 -02 50,000 50,000 50,000 23350 Academy Drainage STM -15 -04 75,000 Garden Road STM -15 -05 26,000 Amlee /Glen Road STM -16 -01 381,000 Manitou Lane STM -16 -02 75,000 Riviera Lane STM -17 -01 87,000 Shorewood Lane STM -17 -02 99,000 Mann Lane STM -18 -01 105,000 Maple Street STM -18 -02 24,000 Eureka Road North STM -19 -01 452,000 Seamans Drive STM -20 -01 148,000 Rampart Court Drainage STM -22 -01 11,880 Galpin Lake Rd Trail T003 226,700 Smithtown From CR 19 to Regional Trail T006 I 1 1 234,500 Future capital Actual CIP (2013 Dollars) 40,000 774,700 416,500 506,000 236,000 129,000 452,000 148,000 0 11,880 0 Percent Inflation 0% 3% 3% 3% 3% 3% 3% 3% 3% 3% 3% Inflated Project Costs 40,000 797,941 441,865 552,920 265,620 149,546 539,712 182,021 0 15,501 0 10/23/2013 40 FREERS