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Ji <br />Elk River -:: <br />Municipal Utilities <br />13069 Orono Parkway • PO. Box 430 <br />Elk River, MN 55330-0430 <br />September 28, 2007 <br />To: Elk River Municipal Utilities Commission <br />Jerry Takle <br />Jerry Gumphrey <br />Jim Tralle <br />From: Bryan Adams <br />Subject: Proposed 2008 Expense Budget <br />Phone: 763.441.2020 <br />Fax: 763.441.8099 <br />Attached are the proposed 2008 electric and water expense budgets for your review. The <br />important assumptions for each budget are as follows. <br />Water <br />Water sales growth 3% <br />Connect fee or WAC fees $300,000 <br />Unit WAC fee -unchanged at $2,000/unit <br />Water rate increase 6% <br />Fixed monthly charge -unchanged at $6.50 <br />1 sr Step rate increase $1.40 to $1.50 <br />2°d Step rate increase $3.25 to $3.50 <br />Expense budget increase from last year 6.8% <br />We still need to determine level of bonding. <br />Electric <br />Electric sales increase overall 8.36% <br />Residential 3.5%, Commercial 3.5%, Demand 4% -remainder in Data Centers <br />Connect fees $275,000 <br />Connect unit fee -unchanged at $1320/residential lot <br />Electric Wholesale Rate Increase 8.5% <br />Electric Retail Rate Increase 6.8% (dollar value of <br /> wholesale rate increase) <br />*The amount of wholesale and retail rate changes with change depending upon <br />Great River Energy's final rate change. <br />Expense budget increase w/o power costs 7.2% <br />