Finance Committee Agenda and Packet 2025 03 20

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City Council Finance Committee Meeting Minutes February 20, 2025 Page 3of5 Councilmember Hamlington asked if we have an idea of when the numbers for the other communities in the ranking were updated because this adjustment will change Louisville's location in comparison. The Deputy Director of Utilities responded that they were all pulled a few months ago so they are all 2024 or 2025 data. He also noted that other communities may not update on an annual basis. Councilmember Cooperman asked about the amount of the increase since the number is based on single family equivalents and this seems like a substantial increase. He asked if these should be updated more frequently. The Deputy Director of Utilities responded that this is essentially a result of the rapid inflation observed in 2021 and 2022. Since we saw it continue into 2023 and 2024, we determined the need to adjust. We didn't want to overestimate based on the rapid inflation in 2021 and 2022. Councilmember Cooperman asked if only certain businesses have to enter into the IPP. The Deputy Director of Utilities confirmed that is correct. Councilmember Cooperman asked if they pretreat water on site. The Deputy Director of Utilities responded that each user has a unique system. Councilmember Cooperman asked why the fees haven't been updated for so long. The Deputy Director of Utilities responded that we didn't have the staff to maintain the programs in the past and ensure we were adjusting to appropriate levels over time. This proposed increase is to catch up to run the program as it should be. We have not been doing cost recovery for the last several years. Councilmember Cooperman asked how this change will be communicated if we go ahead with this fee for 2025. The Deputy Director of Utilities responded that both fees were anticipated to go into effect May 1 at the same time as the other rate increases. We are planning on sending a letter to all industrial users to give them an estimate of what 2025 will look like after City Council approval has been received. Councilmember Hoefner commented that this is the kind of thing we should do in other areas where fees haven't kept pace with our costs. Public Comments: Councilmember Kern asked about the timing of the notification process, expressing concern that businesses won't receive much time in order to become compliant and adjust their budgets. She suggested not requiring compliance in May, but maybe rather in August or September due to the significant increase. There was an extensive discussion around the options around the timing of compliance requirements/when to implement the new higher fees. Councilmember Hoefner asked staff to recommend a reasonable delay in requiring compliance. Councilmember Hamlington agreed with delaying further to allow notification time for businesses to adjust to the increase in costs. She expressed uncertainty as to how long the delay should be and she is comfortable leaving that decision to staff for the IPP fee increase. 2026 Budget Supplemental Year — Preliminary Calendar: 5/143