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City Council Minutes October 6, 2025 --------- Page 6 of 7 11.4 2025 Elk RiverFest Recap and Plans for 2026 The staff report was presented. Mr.Shelby stated planning for 2026 is underway. He asked the Council if the evening part of the event should be kept and if staff should continue to try to build it into something more that can grow or if they should focus more on a daytime event. He also asked about having liquor at the event. The Council concurred on a family-focused daytime event with liquor sales. 11.5 Wastewater and Stormwater Rate Analysis The staff report was presented. Mr. Femrite introduced President Mark Derany with AMKO Bond Services, who discussed the adequacy of the revenue the city is collecting to cover wastewater and stormwater infrastructure costs. Mr. Derany reviewed his reports and explained his methodology as outlined in the staff report. He focused on three categories for wastewater: basic growth, debt service coverage, and the capital improvement plan. He stated the city had been projecting about a 3% growth annually, but it does not include the debt service coverage or future projects. He commented that the city has a really well run utility from a financial standpoint. He recommended a 5% increase to rates, including connection fees, to be implemented annually from 2026 through 2030 to cover inflation of operating expenses, and to cover the capital improvement plan project expenditures. He also reviewed his stormwater analysis and recommended a 3% increase in the stormwater fee. Mr. Femrite summarized the recommendation of a 5% rate for the sanitary system and a 5% rate on our connection fees, and 3% rate for storm sewer which is in line with projections from five years ago. He discussed how the city participates in an annual rate survey where our rates are compared against other cities and Elk River is the lowest. He noted our systems are different, but have good value for the residents. He noted the Council will have the opportunity to review and adopt fees later this year when the fee schedule is updated. 11.6 Northeast Sewer and Water Extension Sub Area Study The staff report was presented. Mr. Femrite introduced Ursinio Puga, with AE2S. Mr. Puga provided an overview of the study in the staff report. He discussed the lift stations and recommended upsizing the smallest pump in the River Park lift station from 388 gallons per minute (gpm) to 610 gpm. He discussed the trunk sewer and recommended adding two small lift stations and an 8-inch gravity pipe. He discussed the water system and noted no additional upgrades were needed. He outlined the cost of the pump upgrade to be approximately $59,000. He noted this is the required city trunk infrastructure upgrade but that there will be developer-driven costs, such as additional lift stations that will be incurred and paid by the developer. He further recommended capping development density at 2 units per acre. Mr. Femrite stated he would meet with an interested developer to discuss the information presented to the Council tonight. He noted if the developer is interested in pursuing a project, then he'd come back to the council with recommended changes to the Urban Service District. 12. MOTION TO ADJOURN