City staff presents proposed water, sewer rates
Published 11:00 pm Tuesday, December 15, 2009
The Albert Lea community got its first view of the proposed sewer and water rates on Monday in a presentation by the city’s finance director.
The proposed sanitary sewer rate structure includes fixed charges based on meter size and the same flow charges for all customer class. The rates, as proposed by the independent firm that studied them, are more equitable than the current system, according to city staff.
Finance Director Rhonda Moen said the original structure for the city’s wastewater treatment plant was developed per grant requirements in 1979.
It was revised in 1992 after a review of the user charge system in effect, and in October 2008 the City Council voted to reduce industrial user charges by 25 percent.
At that time, the council directed the staff to have a rate study performed, and firm TKDA was hired to perform the study. The study was completed in November, she said.
Moen said under the current sanitary rate structure, the fixed charges are not easily understood or reproducible. The calculation of costs attributable to flows and loads are still based on having Farmland Foods as a customer, and flow charges vary by customer class. This is hard to justify, she noted. The Farmland Foods plant burned and closed in 2001.
The proposed rate structure, she said, gives fixed charges for both the water and sanitary sewer based on meter size. Costs attributable to flows and loads are distributed more fairly and flow charges are the same for customer classes, she said.
The rates are easier to understand, administer and justify, according to Moen’s slideshow presentation.
Under the structure, the projected water fund revenues for 2010 will be budgeted at $1.85 million compared to $1.57 million that came in during 2009, Moen said. Water revenues for 2010 are projected to result in a net income of $146,000.
For the sewer fund, revenues for 2010 are projected at $4.1 million compared to $3.5 million for 2009. Sewer revenues for 2010 are projected to result in a net income of $277,000.
For the average residential customer this would mean an about $1.45 per month increase, Moen said.
She noted the average residential customer uses 2,100 cubic feet per quarter.
Their current monthly water and sewer bill is $14.10 for water and $28.54 for sewer for a total of $42.64.
Under the proposal, the monthly bill would be $14.65 for water and $29.44 for sewer, for a total of $44.09. This is a 3.4 percent increase.
Moen said any residential customer who uses 2,800 cubic feet or more per quarter will actually see a reduction in their sewer charges.
Commercial and industrial users see a larger increase, which has proven to be the major issue for councilors and business people thus far.
Moen said her presentation is just introducing the new structure, and the council will have the discretion to set the water and sewer rates tentatively on Dec. 28.
Mike Woitas, who operates the Country Inn & Suites in Albert Lea, said he is unsatisfied with the way the structure is put together based on meter size.
He said the hotel, which has a 3-inch meter, will jump up from about $77 on the sewer basic service charge to about $244 under the proposal.
He said state code requires the hotel to have the 3-inch meter. While it is one of the busier hotels in town, it is also one of the hotels with less water flow.
“We only want it to be an equal playing field,” Woitas said.
He asked the City Council to set a structure based on the flow rate.
“We can’t go down to a smaller meter size,” he said, noting state law.
He commented he’s not sure whether other hotels in town are complying with the state code-regulated meter size.
“I just think we need to do some more checking on the commercial side,” Woitas said.
He said the new rate structure would hurt businesses. He described business people as the base of the town.
Resident Harold Kamrath suggested cutting down on the digester buildings at the Albert Lea Wastewater Treatment Plant.
City Engineer Steven said it is critical to keep both sides of the treatment center running.
Albert Lea-Freeborn County Chamber of Commerce Executive Director Randy Kehr asked that the city publish some form of executive summary of the proposal, as Moen’s slideshow was the first time for many people to see the presentation.
“To get information tonight is kind of abrupt,” Kehr said.
He asked to recess the public hearing and give people the chance to look at it more in-depth, and then figure out why the changes were made.
The City Council is expected to take action on the rate structure Dec. 28.
In other action, the City Council:
Approved an agreement with the Freeborn County Humane Society for a joint project for the operations and expansion of the animal shelter.
Under the agreement the Humane Society will finance the construction of a new kennel facility on city property in exchange for a 30-year lease.
The city will pay $400 a month, and the Humane Society will operate the facility.
An anonymous donor came forward to donate to the cause, and the Humane Society has fundraised to match that donation.
Look to the Tribune this week for a more in-depth story about the agreement.
Approved a resolution requesting Gov. Tim Pawlenty and the Minnesota Legislature to refrain from further unallotment of local-government-aid payments to Minnesota cities.
The resolution asks the governor and Legislature to call an immediate special session or address the budget deficit upon the opening of the session on Feb. 4, 2010.
Had the first reading of an amendment to the tattoo ordinance.
The proposed ordinance came before the council earlier this year but has since been revised.
The ordinance addresses tattooing, body piercing, body branding and body scarification with the intent to protect the health and welfare of the general public, City Manager Victoria Simonsen said.
It includes a section on definitions, licensing requirements and procedures, license application, review and investigation, restrictions on businesses, as well as health and sanitation requirements to be a licensed facility, she said.
There will be a public hearing about the changes at the Dec. 28 council meeting.
Had the first reading of an interim sign ordinance.
Simonsen said the interim ordinance would temporarily prohibit illuminated flashing light signage within the B-3 District and such signs greater than 400 square feet throughout the community.
The interim ordinance came up after a public concern over illuminated flashing light signage.
Some question whether the signs pose a hazard to drivers, bicyclists and pedestrians others question whether the signs should be regulated within the B-3 district, also known as the downtown area, Simonsen explained.
The second reading of the ordinance will be Dec. 28.
Approved a joint powers agreement with the state Department of Public Safety and the Bureau of Criminal Apprehension for e-charging law enforcement complaints. This is a new service that will help law enforcement communicate electronically with courts, prosecution, the BCA and the Department of Public Safety, Simonsen said.
Approved a joint powers agreement with the Minnesota Pollution Control Agency for the use of excess funds from the North Edgewater Park cleanup project.
The state Legislature allocated $3.65 million of state general obligation bond proceeds in 2006 and an additional $2.5 million in 2008.
The cleanup was completed, however, for about $5.2 million. The agreement specifies that the remaining $862,000 may be used by the city to provide sewer and water service and to replace the public park amenities that were removed during the remediation.
Approved a request to use the area around the Pelican Breeze boat landing at Frank Hall Park for “The Big Freeze” event on Feb. 13, 2010.
Kehr and Albert Lea Convention and Visitors Bureau Director Susie Petersen said there are a number of events planned for it, including a winter carnival for the children, a polar plunge hosted by the Albert Lea Fire Department, a broomball tournament and softball tournament and snowmobiling runs on the lake.
There will be music and food vendors, along with a chili cookoff, Petersen said.
Approved a variance to Joseph and Cathy Klick for an attached garage at 817 Lakeview Boulevard on the west side of their house.
The Board of Appeals also voted to allow the variance.
Called a public hearing for the adoption of the 2010 fee schedule for Dec. 28.