02-10-1998 ERMU MIN - Laserfiche WebLink

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Page 2 Regular meeting of the Elk River Utilities Commission February 10, 1998 5.3 Review Eastern Area Development Proposals Pat Klaers, Terry Maurer and Lori Johnson took part in the discussion with the Utilities Commission regarding the Eastern Area Expansion. The city has suggested the Utilities finance the trunk water system for the development. Among points discussed were, up-front costs, assessable costs, shortfalls,time frames, and possible TIF financing may be available for the water and electric utility installation. George Zabee commented that this arrangement should be considered, but to proceed carefully. No formal action initiated,but Staff was directed to pursue options. Bryan Adams pointed out that the development will have a significant impact on the Electric side of the Utilities. Estimated project costs for the electric trunk system is in the $2,676,000.00 range. The Springstead Study indicated the water utility may be able to finance the water production facilities for the expansion. Possible alternatives of financing were presented and reviewed. As a related issue, Bryan Adams advised the Commission of the City of Otsego's intention of installing sewer and water on Parrish Avenue, which will effect the development of area within our service territory, and also have financial ramifications that need to be addressed. 5.4 Review and consider Springstead Final Report The Springstead report encompasses current and projected rates, charges, and debt capacity for the Water Utility. The analysis includes projections for repaying existing and future debt service for planned capital improvements. The Commission and Staff discussed aspects of the report, especially regarding the financing of the future growth of our service areas. It was the concensus of the Commission that rates be raised gradually, on an annual basis, rather than having a disproportionate raise in one future year. George Zabee moved to receive and file the Springstead report. John Dietz seconded the motion . Motion carried 2-0. 5.5 Review Senior Citizen Water Rate The current Senior Citizen Water Rate is applicable for anyone over the age of 62, who applies. Bryan Adams questioned the Utilities obligation for advertising and administering the rate. Staff is directed to include information on the rate in the Current,the Connect, and with future bill stuffers.