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City Council Utility Committee <br />Meeting Minutes <br />Friday, November 9, 2018 <br />Page 3 of 5 <br />list items and final payment is anticipated in 2018. Any unspent funds will be going <br />back to the water fund and a new budget in scheduled for 2019. <br />Mr. Kowar described the budget process is a complex snapshot whereas the rate <br />model is more flexible and run on a closer to real time basis. Staff are constantly <br />working with all the other project managers to make sure the rate model represents <br />as up to date as possible while maintaining a level of conservatism. Staff strive to <br />have the rate model always ahead of the budget process. <br />Councilmember Stolzmann requested further discussion on carry forward. Mr. <br />Peterson explained that when the next year's model is created the CIP budgets <br />and the starting fund balance numbers are reset to match final budget numbers <br />from the previous year. Therefore, the carry forward is isolated at the end of the <br />year between the yearly rate analyses minimizing this impact. Mrs. Golden <br />provided additional background on the 3' quarter report and what is presented to <br />the Finance Committee. <br />Mr. Kowar went on to highlight another challenge of current process of procuring <br />multiyear projects. Mr. Kowar asked what other potential projects could result in <br />savings that has occurred after the budget process. Mr. Peterson stated that there <br />are currently four additional projects: WWTP, Water and Sewer Lines and Pump <br />Station that could result in excess funds returning to their respective funds. The <br />savings will be shown in the presentation for the 2019 rates in March of 2019. <br />Councilmember Stolzmann requested additional details to be included on how the <br />budget numbers are reconciled. Councilmember Stolzmann thanked staff for <br />working within budget and working hard to return funds. <br />IX. Rate Update <br />Mr. Peterson stated the 2019 rate presentation follows the same format as <br />pervious presentations and is a finalized version of what was present at the prior <br />utility committee meeting in preparation for the budget. <br />Councilmember Stolzmann asked what the determined impact(s) would be to the <br />stormwater fund by moving the street sweeper up to this year instead of next year. <br />Mr. Peterson responded that there is no rate impact for the street sweeper going <br />earlier. Mr. Peterson went on to explain that rates are being driven by capital <br />expenses in 2018, 2019 and 2020, whereby rates were split evenly over 2019 and <br />2020. Therefore the timing of projects within this period have no impact on the <br />spilt rate. <br />Mr. Kowar went on to discuss the debt service balances and referred to the <br />presentation and asked if there were any changes needed. Councilmember Keany <br />requested to add a slide representing a "Base Monthly Residential Bill" to show if <br />somebody is just using strictly base rates on everything. Mr. Kowar provided <br />direction to staff to include this addition. <br />Councilmember Stolzmann raised if a cost of service should be discussed in 2019. <br />Mr. Peterson highlighted that a cost of service discussion is currently scheduled in <br />May, 2019. Mr. Kowar went on to say staff has begun an internal review and is <br />planning this work in-house. Depending on the complexity there is a possibility <br />that outside consulting service maybe needed to supplements staff's work. <br />8 <br />