City Council Minutes 2014 01 14 SP

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City Council Special Meeting Minutes January 14, 2014 Page 3 of 14 which helps cash flow. One downside is once you accept funding, if the project cost more, the City will be responsible for the short-fall. Significant Budget Changes — Utilities • Incorporate preliminary recommendations from Utility Rate Study • Remove WTP Pump Station project and North Clear Well project from 2014 bond issue • Changed utility rate increases to match "smoothing" financial planning scenario COUNCIL QUESTIONS Mayor Muckle requested an update on the Water Intake repair project and flood related issues to the water system. Public Works Director Kowar explained the $500,000 Intake repair project will reconfigure the facility and add technology to reduce the cost to manage the facility. Staff is working with FEMA for reimbursement beyond the $167,000 associated with this asset as covered by insurance. Deputy City Manager Balser explained the Intake project will also follow the Alternate Procedure Pilot Program for a quicker reimbursement. Council member Jasiak requested information on the timing of the bridge. Deputy City Manager Balser reported staff requested the FHWA replace bridges on Dillon and on County Road. Staff received word the cost to replace with betterments to the bridge had increased to $3.56 million dollars. FHWA will make recommendations on whether the bridge will be simply replaced as was prior, or reconstructed with betterments. Public Works Director Kowar explained the project is subject to federal regulations and their timelines. There will be a RFP and public process with construction in the spring of 2015 and completion in six months. City Manager Fleming reported some of the changes in the budget are related to the flood and some to the Utility Rate Task Force and Water Committee. Public Works Director Kowar explained there have been several meetings with the Utility Rate Task Force. The result of the study will be discussed with the Water Committee and recommendations to Council will be made in March. The Utility Rate Task Force is looking at a two-phase rate increase, with one increase in March or April and the second phase being a change in how the rates are charged in 2015. Council member Loo asked for clarification on the removal of the WTP Pump Station and the North Clear Well project from the 2014 bond issue. Public Works Director Kowar explained initially the increase was to optimize cash flow through the bond and a one-time rate increase; however the Utility Rate Task Force felt it was more appropriate to smooth out the rates and create less of a burden on the bond funds. Finance Director Watson explained the two projects will be cash funded. There are two aspects of the rates; one is the bond coverage and the other is keeping enough in reserves. Significant Budget Changes — Golf Course: