12-09-2019 Council Packet - Laserfiche WebLink

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AGENDA ITEM Forfeiture Fund receives its primary funding from the Police Department's drug and alcohol enforcement activities. The funds must be used for drug and alcohol related activities. The TIF Fund is used to account for revenues related to the Orono Woods Senior Housing Development. Debt Service Levies The 2020 levy for debt service is $711,000. This levy is used to pay the debt service on the City's outstanding bonds. Enterprise Funds The Water, Sewer, Stormwater, and Recycling Funds are designed to account for the business type activities of the City. These funds do not receive any property tax revenue. The goal for the Enterprise funds is to be fully funded by rates without depending on special assessments for infrastructure improvements. While there is no formal adoption of the expenditure budgets, the information is included in the budget book. On the revenue side of the budget, the utility rates are approved annually as part of the fee schedule. The utility rate increases being recommended are Water 35%; Sewer 20%, Stormwater 90%, and Recycling by 60%. Additionally, based on the area (North, South, Wayzata, or Long Lake), the sewer and water will be charged accordingly. Staff has also looked into multi -residential and commercial properties and are recommending charging Billing and Ready -to -Serve charges per SAC Unit. The utility rates will be approved tonight as part of the 2020 Fee Schedule. Water The water fund has historically been operating at a loss. Because depreciation is a non-cash expenditure, the fund has had a positive operating cash flow since 2009. In previous years, the operating loss has been covered by the revenue received from antenna leases on the water towers. The revenue from the antenna leases has been moved out of the Water budget since 2018 and this revenue decrease has been recovered through water rates. As presented, the operating budget for 2020 will have an operating loss of $157,481. The expenditure budget is increasing by $58,540 (6.3%). $18,400 of the increase is due to an increase in depreciation and $6,000 of the increase is due the information technology (IT) being centrally managed going forward. The operating transfer of $55,000 is to the debt service fund supporting the Casco Point Bonds ($55,000). The non-operating interest expense is for the interest on the 2014 Water Bonds. 2020 capital expenditures as identified in the 2020 CIP include a water main replacement at CSAH 15/19 and water valve replacements. The 2020 capital expenditures total $233,855. The Water Fund's anticipated cash balance for the fund at the end of 2019 is $182,900. Sewer In recent years, the sewer fund has mostly operated at a loss. Non-operating revenues however, have consistently offset the operating losses. This has resulted in a positive operating cash flow for the fund. The single largest expense for the sewer fund is the Met Council disposal charges. The four years have seen increases in the amounts of $37,410 (9.5%), $41,276 (9.6%), $82,147 (17.4%) and $64,035 (11.5%) respectively. This is a 57% increase in four years. As has been discussed with the Council during previous budget processes, heavy rains and high water tables increase the flow through the MCES lift stations and increase our disposal charges. Prepared By:.MRU Reviewed By: JJV Approved By: �bV