6.3. SR 03-11-2013 - Laserfiche WebLink

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The city will maintain a system of capital charges for sanitary sewer and water services. The charges will be collected when undeveloped land is platted and when new users connect to the system. Revenues from the capital charges will be accumulated and used to pay for the capital investment related to the maintenance and expansion of the utility system. The city will strive to maximize the revenues collected from capital charges in order to protect existing utility users from bearing the costs associated with growth. The City Council will work with the Utilities Commission to set capital charges for the water system at appropriate levels. In not less than three-year intervals, the city staff shall evaluate the amount of all capital charges and recommend necessary changes to the City Council and the Utilities Commission. The city will maintain an equipment acquisition and replacement program. The plan shall be updated annually to provide funding for all equipment purchases over $25,000 to be made in the ensuing five fiscal years. All attempts shall be made to fund the program without the use of debt. It is recognized that state- imposed levy limits may create the need to incur debt for equipment acquisition. The city will establish and maintain a program for the construction and maintenance of the municipal storm water management system. Financial projections for the storm water management system shall be updated annually. The city will establish and maintain a program for the maintenance of the municipal street system. The initial sealcoating in new subdivisions will be financed with monies collected for this purpose at the time of original development. Other sealcoating and other maintenance activities will be financed through the General Fund. The city will prepare an ongoing plan for the reconstruction of all city streets and identify a sustainable source of funding for the street reconstruction program. Cashflow projections for street reconstruction projects will be prepared annually to ensure adequate, ongoing funding. DEBT The city debt issuance policy utilizes the following guidelines and practices which were identified through state statutes,bond rating agencies,and the Government Finance Officers Association (GFOA). This policy can be amended by the City Council, but is consistent with general municipal practices at the time of adoption. A. Debt Limits 1. Legal Limits Minnesota Statutes, Section 475,prescribes that outstanding principal of debt cannot exceed 3% of taxable market value. This limitation applies only to debt that is wholly tax-supported. a. The type of debt included is either General Obligation Debt of any size bond issue (G.O.) or Lease Revenue Bond Issues that were over $1,000,000 at the time of issuance. Several other types of debt do not count against the limit,including: i. G.O. tax increment ii. G.O. abatement iii. G.O. special assessment iv. G.O. utility revenue Financial Management Policies Page 7