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City Council <br />Meeting Minutes <br />March 15, 2016 <br />Page 6 of 17 <br />time is for 2016 rates only. Future rates will be evaluated for future increases each <br />year. <br />In late 2015 and early 2016 City staff and Raeftalis Financial Consultants completed a <br />rate evaluation for the water, wastewater, and stormwater funds. This evaluation used <br />the most recent cost and revenue information to review and update the work completed <br />in the 2014/2015 rate evaluation. The goals of this work are to ensure rates and fees <br />continue to generate sufficient revenue to maintain required income to expense and <br />debt coverage ratios, sustain utility operations and facilitate effective planning and <br />budgeting. Staff presented the results of this evaluation to the Water Committee in <br />November 2015 and February 2016. <br />The project team realized they could not just do nothing so reviewed two other <br />scenarios. The "Just -in- Time" scenario uses rate increases set and timed,to generate <br />revenue needed only in that year. This approach results in major increases in one year <br />and excess revenue or rate reductions in subsequent years. The alternative <br />"Smoothing" scenario sets and times rate increases to produce just enough revenue <br />when needed but do so by more gradually increasing rates over several years. Staff <br />recommends the Smoothing scenario continue to be used to minimize large increases <br />and to distribute increases over time. <br />The recommended increases will continue the process of matching Utility revenue with <br />projected expenses for operations and required capital improvements. If adopted, the <br />average residential combined water, wastewater, and stormwater utility bill will increase <br />from $63.46 per month to $71.26 per month. <br />Staff recommends increasing utility rates for the 2016 calendar year by 13.0% for water <br />and 13.0% for wastewater, with the increase effective May 1, 2016. Staff does not <br />recommend an increase to stormwater rates at this time because current rates are <br />adequate to cover projected costs. <br />Mayor Muckle called for questions from Council and hearing none, called for public <br />comment. <br />PUBLIC COMMENT <br />Debby Fahey, 1118 W. Enclave Circle, Louisville, CO asked if money was being put <br />aside to pay any debt increase in the future. <br />Finance Director Watson stated the debt load is designed to remain level. <br />Michael Menaker, 1827 W. Choke Cherry Drive, Louisville, Co noted he had no trouble <br />paying his fair share, but took issue with the last gallon costing more than the first. <br />Charge equitably; remove punitive pricing from the water rates. <br />COUNCIL COMMENT <br />