5.7. ERMUSR 11-13-2008Ji
Elk River -~
Municipal Utilities
13069 Orono Parkway • P.O. Box 430 5 ~ Phone: 763.441.2020
Elk River, MN 55330-0430 Fax: 763.441.8099
November 4, 2008
To: Elk River Municipal Utilities commission
Jerry Takle
Jerry Gumphrey
John Dietz
From: Theresa Slominski
Re: Proposed water rate changes 2009
At the last commission meeting staff was asked to review the possibility of changing the
fixed monthly charge instead of the 1 sr step rate for the 2009 budget. It was noted that a
10¢ increase of the base rate results in approximately $50,000 additional revenue. Based
on the number of meters, a $1.00 increase in the fixed monthly charge results in $47,500
additional revenue (and a $2.00 increase results in $95,000 additional revenue.) Currently
the base rate is $6.50 and so this would increase the base rate to $7.50 or $8.50. At the
December 2007 commission meeting, a comparison was presented of some surrounding
areas typical monthly water bill from the AE2S North. Central Utility Rate Study (a copy
is attached) and the fixed rates ranged from $2.00 to $15.00, with the average being
$7.88. Changing the fixed rate seems reasonable given the above information. If it is the
commissions desire to change the fixed rate, some scenarios are also provided to compare
and review.
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Sidney, MT
Rochester, MN
Monticello, MN
Cloquet, MN
Lake City, MN
Belgrade, MT
Faribault, MN
Albert Lea, MN
Willmar, MN
Elk River, MN
Austin, MN
Buffalo, MN
Detroit Lakes, MN
Owatonna, MN
Northfield, MN
Livingston, MT
Kalispell, MT
Brainerd, MN
Minot, ND
Stewartville, MN
Brookings, SD
Pierre, SD
~ Waite Park, MN
U Alexandria, MN
Jamestown, ND _
Spearfish, SD _
North Mankato, MN _
Litchfield, MN _
Zimmerman, MN _
Brandon, SD _
Hibbing, MN _
Devils Lake, ND _
Worthington, MN
West Fargo, ND
Marshall, MN
Bemidji, MN
Wahpeton, ND
Baxter, MN
Grand Rapids, MN
Hutchinson, MN
Winona, MN
Vermillion, SD
Crookston, MN
Missoula, MT
Red Wing, MN
New Ulm, MN
St. Francis, MN ,
0
GROUND WATER SYSTEMS
.. L-~ ~~ _ $11.50
°-~ - = `_ $12.73 _
"-~`~_="=_-- $13.38 Water Fixed Charge
_--=___~="__ _ = "~ $14.58
-_- ______ $14.83 t_' Water Volume Charge
$15.03 (Excluding Minneapolis /
-- -_ - ~: $15.41 St. Paul Metro)
~_~- - --- - -- ---_ -- - --- $36.07
__-- ---_ :_. `__ ____ -_.- ~- $36.28
--- ---- --- ,-:- $37.25
5 10 15 20 25 30 35 40
Typical Monthly Residential Water Utility Bill ($)
45I
_I
Scenario 1 Scenario 2 Scenario 3
Fixed Monthly Charge 6.5 7.5 8.5
Fixed Monthly Revenues $ 306,215 $ 353,325 $ 400,435
Tier/Step Revenues $ 1,566,490 $ 1,557,972 $ 1,557,972
Tier 1 $.10 increase $ 43,843
Total Revenue $ 1,916,547 $ 1,911,297 $ 1,958,407