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request to increase the authorized volume of appropriation. This mandate applies to rates related <br /> to water use only. <br /> The Department of Natural Resources has provided further guidance that an increasing block rate <br /> means that there is a sufficient increase in the rate between the tiers to promote conservation. <br /> Specifically, the DNR would be looking for a meaningful increase between the blocks to <br /> encourage conservation. We believe that the recommended rate structure proposed complies with <br /> DNR guidelines. <br /> Proposed Water Rates: <br /> The proposed rate structure was designed in order to provide suff'icient resources for projected <br /> operating expenses and capital costs and to maintain cash balances where necessary. <br /> In 2008, the City currently spends approximately $342,000 in fixed costs such as salaries, <br /> contractual, insurance and depreciation. The remainder of the expenses is for water treatment and <br /> equal roughly$207,700 per year. <br /> Recommended Rate Option: Fixed Charge and 3-Tiered Usage Charge <br /> In order to determine the appropriate tier breaks, user and usage data was analyzed. The <br /> following graph shows the distribution of residential users. <br /> i Residential Usage <br /> I <br /> I <br /> I 90 <br /> � 80 �-------- —�--------------------.._------------------ —�---- __. <br /> � 70.��..__ .—. _-----__.__...�---__......_._._�_. ----�-- — ---.._---�—_.._.._.__.. <br /> N � <br /> 0 60 -------.----_--__----------- --- ------________ —_—_--- <br /> L <br /> NSD �. .__.____ __� _ _�_�.___"__ <br /> ' _._�-__._._... <br /> O <br /> SM1� . ..__..._ . ___.. _ ....._. ._"'_ —,.."_' __— .__....._�...__.._�...... <br /> =30 ' .' � ---- __ _— -- '.._.— - - ----_---- _— ------ <br /> ! '°� � _ _ �� � ��? I-� ��_c� ��� ��� �e�-��_ ._,_— _-------�-- <br /> � 0 N 21 31 4i�St 61'11�,81 51,101 It1 12'��15+1A1 151 151 171 191 19+101I211121�231 2N�,251;261j271 M1 291 701 311;321�31�311�St�61 ST1 7E1�1�101�1111N, <br /> � i To'To To To�Ta To To To To�To To,To,To To i Ta'�To'Ta Ta�To To i To To i To To To'�To�To�To To To To To i To To,To To Ta io Ta To To To To� <br /> i,10 10 30 /0 SO 60 7D 60 90,100 110i110i130 140j1S0 160 170 1W 190 200�210 7l0;Yl0,210 2SO�tA0�2T0 tA0 290 300 710 3t0';3�0 3/0�350 7A0 110 9!0�90/OO N0�/20 170, <br /> I Unib PerYear <br /> Tier Number of Users in Tier <br /> Tier One 294 <br /> Tier Two 312 <br /> Tier Three 305 <br /> The table above shows that 74% of the users are captured within the first two tiers. <br /> Unlin�Rure Studv Pa,�e I1 <br /> Citv q(Oroito,hlirrnc:sota December.?009 <br />