City Council Minutes 2006 09 26 SP

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City Council Special Meeting Minutes September 26, 2006 Page 3 of 5 one-year extension. The contract will expire in 2007. Staff will bring forward another contract before the end of the calendar year. WATERJWASTE WATER Finance Director Leslie presented a comprehensive review of the Water and Wastewater Funds. For 2007, the City of Louisville is proposing a 3% water and sewer rate increase across the board. Studies compiled by Denver Water show that Louisville water rates are one of the lowest in the region in 2006 based on an average annual usage of 120,000 gallons. Rate increases are implemented to cover increases in operational costs. The Denver/Boulder Consumer Price Indexes, which are tied to inflation, show a 3.8% increase from last year in June 2006. Some of the other highlights in the fund are listed below: . The water and sewer charges budget for 2007 is based on a 3% rate increase. The revenue forecast for 2006 will be $6.3, which is $1.6 million over budget. Therefore, the City has projected water and sewer charges to be $5.9 million in 2007. . Currently, staff is estimating a 3% increase in personnel services over the 2006 budget. The actual personnel costs have not been calculated on a cost center basis for this review. We received benefit rates increases for 2007 on September 21, 2006 and will begin to enter the rates into the payroll system to better calculate a 2007 cost for personnel. Staff does not anticipate that the City will incur more than a 3% increase in personnel costs over 2006 budget. . Major capital project items include the first phase of the Windy Gap firming project expected to begin in 2007 with design costs of $450,000 and construction starting in 2008 for $5,831,000. Also, the City is anticipating replacing its meters over a period of 4 years for a total project estimate of $2.0 million. . The City is within its debt ratio coverage of 1.15 for the next five years. Public Works Director Phare addressed the 2007 budget and noted there will be no major shift in activities at the water or waste water plants, and no additional personnel will be added, however, there will be some equipment replacement. He explained the long-range capital projects budget includes radio frequency water meters, however until the technology meets the level of Staff's expectation, the water meter replacement program will be put on hold. Finance Director Leslie reviewed the projected water and sewer tap fees for 2007.