NR City Council considers long range utility needs, rate hike likely
During a special joint session Monday evening between the New Richmond City Council and members of the Utility Commission, City Administrator Mike Darrow and City Finance Director Rae Anne Ailts presented the findings and recommendations of a comprehensive water and sewer rate analysis conducted by Trilogy Consulting LLC.
"We asked Trilogy to look at various options which included, no rate change at all, a tiered approach to the rate change, and if circumstances resulted in the loss of one of our largest customers what would be the impact on rates. Over the last six months, we've worked through a lot of those options with Trilogy," said Ailts.
Trilogy presented their analysis to the Commission in March. Over the next 60 days, Trilogy worked with commission members and city staff evaluating rate design based on cash flow impact, cash reserves, debt covenants, current and future capital expenditures, and financial sustainability. Detailed rate information and comparison materials can be reviewed at www.nrutilities.com/water-sewer-rate-study. Expect additional information to be added to the site prior to the Utility Commission meeting on July 10, 2019.
In an effort to keep residents informed of a potential rate hike and the reasons for that increase, the city hosted two open houses June 5 and June 19, mailed letters of explanation directly to utility customers, and promoted educational and informational materials posted to the city/utility website via social media. City staff also met directly with several commercial customers that would be significantly impacted by a rate increase.
In summary, water rates were last increased in 2014 and sewer rates in 2012. Growth has increased demand while government regulation, aging infrastructure and additional market costs have exceeded existing rates revenues requiring an infusion of cash from the utility reserve account.
To maintain a healthy reserve and in anticipation of significant capital expenditures over the next five years such as upgrades and replacement of core infrastructure at the wastewater treatment plant in 2020-2021, the city is looking at a sewer rate increase of $3.87 per month and a water rate increase of $5.35 per month for a typical household. The sewer rate increase if approved, is anticipated to take effect in the fourth quarter of 2019. The water rate increase if approved, would take effect in the first quarter of 2020. In addition to council approval, the water rate must also be approved by the Wisconsin Public Service Commission.
The Utility Commission is expected to consider the rate hikes at its July 10 meeting which starts at 8 a.m.
The City Council is expected to consider the rate hikes at its Aug.12 meeting which starts at 7 p.m.
Beebe building, DQ development update
Five firms responded to the city's initial RFQ's pertaining to the development of the Beebe building and DQ property posted in January 2019. An initial round of interviews has narrowed the field to three firms.
"I can't stress enough how much more important it is to have a great relationship than it is to get it done fast. I've been doing this outside of the city on the private side prior to this for a long time. If you race to get it done because of public pressure, a lot of times you make mistakes. So it's really important during these interviews to get to know the firms that are interested," said Darrow.
Beginning on June 26, members of the City Council and Forward New Richmond will conduct interviews with three firms to assess the financial viability of each project. The initial focus of these interviews will be the redevelopment of the Beebe building (downtown project) only.
The city is proposing to facilitate three meetings in August to introduce the final firm or firms. The meetings will include a City Council meeting, Forward New Richmond meeting and a community discussion with residents prior to the project being awarded.
The city expects to highlight phase plans for both the Beebe building and DQ property sometime in August and September.
The city has been actively recruiting community members to participate in the interview and vetting process via the city newsletter and social media. The city has been meeting with interested parties since mid June and continues to seek folks interested in participating in the process. For questions or to participate, contact Darrow at 715-243-0401 or firstname.lastname@example.org.
Although there is no firm deadline by which the City Council must select a final firm, the intended timeline is for the community vetting process to occur in August with a final decision coming in early fall.
The city is planning to produce a series of podcasts (Podcast New Richmond) which, along with social media updates, will document the process, facilitate community discussion and provide an alert for future meetings.
Following the joint meeting with the Utility Commission, council members approved an expenditure not to exceed $46,061 for the purchase of a Getac digital video system including six MVR squad cameras, 10 body cameras, 30GB of dedicated cloud storage, training and warranties for the police department. The projected life on the cameras is five years. The purchase of 10 body cameras will require deputies to transfer cameras between shifts. The capital budget allotment for 2019 was $32,500 in anticipation of replacing just the video cameras in the squad cars. The $5,984 annual fee for the dedicated cloud storage will be absorbed into the police department's annual operating budget. The remaining $7,577 will be funded through the 2019 capital budget financing packaging.