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department expense budget, the overall preliminary electric department expense <br />budget increase is 1.2% compared to 2024 budget. <br />The budgeted Payment in Lieu of Taxes (PILOT) amount for 2025 is $1.934 million. <br />PILOT is comprised of $1.669 million based off 4% of the city of Elk River sales <br />calculation, and $265,000 in donated utilities and labor. This preliminary projection will <br />change when revenue is budgeted for next month. <br />2. Water Department Expense Budget —The 2025 budget for water expenses is an 8.6% <br />increase compared to the current year's budget. It is noteworthy that the 2024 forecast <br />for expenses is a 3.4% decrease compared to budget. Most notable accounts are <br />depreciation which is due to large capital projects being put into service, maintenance <br />of wells, and medical insurance due to an expected 12.55% increase to premiums. <br />3. Both Electric and Water budgets have been built with a wage adjustment of 3.67% on <br />January 1, 2025. Water is anticipating adding an additional water operator with the <br />increased workload of the additional wells, treatment plants, and AMI project. An <br />additional administrative specialist is also slated for 2025. <br />ATTACHMENTS: <br />• Preliminary 2025 Electric Expense Budget <br />• Preliminary 2025 Water Expense Budget <br />Page 2 of 2 <br />63 <br />