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<br /> <br /> <br /> <br /> <br />The fee structure for municipal utilities should produce a net annual surplus of revenues <br />over expenditures after accounting for all operating costs, depreciation of capital assets and <br />payment of debt service. <br /> <br /> <br />All municipal utility funds will maintain adequate cash reserves. The reserve needs vary for <br />each municipal utility. The assessment of cash reserves should take into account future <br />capital investments, diversity, and stability of revenues and potential for unanticipated <br />changes in revenues and expenditures. <br /> <br /> <br />All utility rates should be reviewed every year to minimize the impacts of rate changes and to <br />insure adequate long-term funding. <br /> <br /> <br />Elk River Municipal Utilities will make an annual contribution to the city. The cash <br />contribution will be based on 34% of gross electric sales within the corporate limits of the <br />city. The City Council will determine the portion of this contribution to be allocated to the <br />General fund, Library and the Equipment Replacement fund. <br /> <br /> <br />The City Council will determine the chargeback to the Sewer, Storm water, and Garbage <br />fund for administration of the sanitary sewer system, storm water, and garbage collection. <br />Any operating transfer not included in the budget must be approved by the City Council. <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />Financial Management Policies Page 2 <br /> <br />