VII.5. Approve Water and Sanitary Sewer Rate Increases; Bishop
November 17, 2020 Council Report 2020-088
APPROVE WATER AND SANITARY
SEWER RATE INCREASES
Proposed Action
Staff recommends adoption of the following motion:
Move to approve Resolution 2020-059 “Increasing Water and Sanitary Sewer Rates Effective January 1, 2021”.
Overview
The water and sewer fund budgets have been reviewed for 2021. The 2021 budget includes conservative assumptions
on the amount of water and sewer that will be used by customers. Both funds have proposed increases based on
operational and capital needs. The water fund and sanitary sewer funds are both proposing rate increases of
approximately 2%.
The City previously conducted a utility rate study for the years 2016 through 2020. The study implemented flat rates
based on meter size and tiered consumption rates for water users, which continue in 2021. The newly proposed rates
are intended to have a limited impact on utility users.
Primary Issues to Consider
• How will the increased rate affect the residents and businesses in the City of Hopkins?
• What are the proposed capital improvement projects?
Supporting Information
• Staff Analysis
• Resolution No. 2020-059
____________________________________
Nick Bishop, CPA
Finance Director
Financial Impact: Water $42K, Sewer $61K Budgeted: Y Source: Water and Sewer Users
Related Documents (CIP, ERP, etc.): _____ ______________Notes: ____ ________________
Rate Increases and Effect on Residential and Commercial Customers
What are the proposed capital improvement projects?
Over the next five years we have identified $7,944,800 and $6,625,300 in capital infrastructure projects related to the
water and sewer funds, respectively. The projects are for ongoing utility improvements related to road reconstruction,
maintenance and equipment needs. The complete detail for all scheduled capital improvements can be found in the
Capital Improvement Plan and Equipment Replacement Plan.
Actual 2020 Proposed
2021 $ Increase % Increase
Single Family Residential (Lower User)
Water (1,500 Gallons)7.52$ 7.67$ 0.15$ 1.99%
Sewer (1,500 Gallons)10.10$ 10.29$ 0.19$ 1.93%
Total Monthly Bill 17.62$ 17.96$ 0.34$ 1.96%
Single Family Residential (Median User)
Water (4,000 Gallons)15.57$ 15.88$ 0.31$ 1.99%
Sewer (3,000 Gallons)20.19$ 20.58$ 0.39$ 1.93%
Total Monthly Bill 35.76$ 36.46$ 0.70$ 1.96%
Single Family Residential (High User)
Water (8,800 Gallons)29.09$ 29.67$ 0.58$ 1.99%
Sewer (4,800 Gallons)33.65$ 34.30$ 0.65$ 1.93%
Total Monthly Bill 62.74$ 63.97$ 1.23$ 1.96%
Impact on Low, Median and High Residential User
Actual 2020 Proposed
2021 $ Increase % Increase
Commercial Property (Low User with a 1" Meter)
Water (3,000 Gallons)14.63$ 14.93$ 0.30$ 2.05%
Sewer (3,000 Gallons)20.19$ 20.58$ 0.39$ 1.93%
Total Monthly Bill 34.82$ 35.51$ 0.69$ 1.98%
Commercial Property (High User with a 2" Meter)
Water (35,000 Gallons)125.58$ 128.20$ 2.62$ 2.09%
Sewer (35,000 Gallons)235.55$ 240.10$ 4.55$ 1.93%
Total Monthly Bill 361.13$ 368.30$ 7.17$ 1.99%
Impact on Low and High Commercial User
CITY OF HOPKINS
HENNEPIN COUNTY, MINNESOTA
RESOLUTION 2020-059
INCREASING WATER AND SANITARY SEWER
RATES EFFECTIVE JANUARY 1, 2021
WHEREAS, the City of Hopkins has established Ordinance No. 92-712 Sewer and Water Utility
rates, City Code section 40-22 which defines water rates and section 40-24 which defines sanitary sewer
rates; and
WHEREAS, the ordinances authorizes water and sanitary sewer to be set forth by
council resolution; and
WHEREAS, utility rates were analyzed to determine the long-term viability of the water and
sewer fund; and
WHEREAS, it was determined that current rates are insufficient to meet operational and capital
needs;
NOW, THEREFORE, be it hereby resolved that the City Council of the City of Hopkins hereby
sets the service charge for the Water and Sanitary Sewer Utilities at the following rates to be paid to the
City upon billing therefore as follows:
The water service usage charge be set at the rates shown.
Flat Rates
Residential – 5/8” meter 3.02
Residential – 1” meter 3.02
Apt/Commercial – 1-1/2” to 2” meter 6.05
Apt/Commercial – 3” meter 9.08
Apt/Commercial – 4” meter 12.09
Apt/Commercial – 6” meter 18.14
Residential and Multi-Family
0 – 3,000 gallons 3.10
3,001 – 5,000 gallons 3.56
5,001 and over 4.09
Commercial
0-10,000 gallons 2.96
10,001 – 20,000 gallons 3.39
20,001 and over 3.91
Irrigation – all usage 3.70
Production Meter 3.12
All water rates are per 1,000 gallons of water consumed.
The sanitary sewer service charge for all classes of users on the system at $6.86 per 1,000 gallons
of water used.
EFFECTIVE DATE: The provisions of this resolution shall be effective January 1, 2021.
Adopted by the City Council of the City of Hopkins, Minnesota, this 17th day of November 2020.
_______________________________
Jason Gadd, Mayor
ATTEST:
___________________________________
Amy Domeier, City Clerk
Water & Sanitary Sewer Rates
November 17, 2020
Water & Sanitary Sewer Funds
Main source of revenue is user charges
Main expenditures are are salaries, benefits,
depreciation, bond costs
Sanitary Sewer fund also pays municipal
wastewater charges to Met Council
Water and Sanitary Sewer Rates
Rates are proposed to increase by
approximately 2%
Flat Rates Per Meter Per Month
Tiered Water Consumption Rates
Sewer Consumption Rates
Refuse and Storm Sewer Rates
No rate increases being proposed
Next Steps
Meeting Date Meeting
Type
Subject Details
November 4
(Wednesday)
Regular
Meeting
Review Options for 2021
Tax Levy
-Review reduced levy options for
2021
November 10 Work
Session
Review Special Revenue
Budgets,Activity Center
Budget, Enterprise Fund
Budgets and Utility Rates
-Chemical
Assessment
-Economic
Development
-Parking
-Communications
-Depot
-Arts Center
-Activity
Center
-Water
-Sewer
-Storm Sewer
-Refuse
-Pavilion
November 17 Regular
Meeting
Approve CIP, ERP & Utility
Rates
November 30
(Monday)
Regular
Meeting
Truth in Taxation Hearing -Overview of 2021 Budget & Tax Levy
-Public Comment
-Approve Final Levy (tentative)
Next Steps
Meeting Date Meeting
Type
Subject Details
December 1 Regular
Meeting
Approve Final Budget & Tax
Levy
-Tentative
December 15 Regular
Meeting
Approve Final Budget & Tax
Levy
-Tentative
-Last scheduled meeting to approve