City Council Agenda and Packet 2015 11 02

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City Council Meeting Minutes October 13, 2015 Page 7 of 18 balances in those funds. Staff has identified projects critical for upkeep of the water and sewer system and over the last year an effort has been made to phase in the rate increases as slowly as possible. The fund reserves are just above the fund balances needed to meet the obligation for the loan repayment. He noted a chart was included in the packet showing, based on the current estimates and projections, what would have to be added to the water and sewer funds each year to replace downtown waterlines before ability to pave those streets; break even in 2016, 1.8 to 1.9 million dollars in 2017, $2.4 million in 2018. This would result in rate increases. Staff needs to know which is Council priority — keeping rates low or paving the streets in the timeframe proposed. Mayor Muckle didn't think anyone was excited about raising rates, but wanted to fix water lines in the downtown area and move forward with paving those streets. Council member Loo questioned the CIP for the Sid Copeland water treatment pump station improvements, a $2.4 million expenditure in 2016. She asked if the Water Committee took a good look at this. The CIP sheet mentions the interconnect with Superior, which she thought was a good idea, but thought the consensus was not to go forward without a definite monetary commitment from Superior. Public Works Director Kowar noted this project is upgrading or replacing the existing pump station at the north water treatment plant and is not related to the interconnect. Council member Loo asked why the CIP item mentioned the interconnect with Superior. Public Works Director Kowar noted staff aims to take care of existing facilities before expansion. The second part is having an insurance policy by establishing the interconnect with the Town of Superior for future peak demand. Council member Stolzmann suggested updating the language on the CIP sheet. Council member Loo agreed, noting the sheet clearly refers to the interconnect with the Town of Superior. Mayor Muckle agreed the update to the pump station shouldn't have been lumped together with the interconnect. Mayor Muckle asked staff to come back with budget cut suggestions in excess of one million dollars to address the paving. Mayor Muckle suggested talking about the Street Faire and asked for a staff presentation. Street Faire 20