HomeMy WebLinkAbout09 04 2018 2019-2028 CIP Report
Phone 952.447.9800 / Fax 952.447.4245 / www.cityofpriorlake.com
4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL WORK SESSION REPORT
MEETING DATE: SEPTEMBER 4, 2018
AGENDA #: 1A
PREPARED BY: FRANK BOYLES, CITY MANAGER
PRESENTED BY: FRANK BOYLES
AGENDA ITEM: CITY COUNCIL REVIEW OF 2020 TO 2023 CAPITAL IMPROVEMENT
PROGRAM (CIP)
GOAL AREA
AND
OBJECTIVE:
High-Value City Services
2. Design a Comprehensive Funding Strategy for Capital Needs.
DISCUSSION:
Introduction
The purpose of this agenda item is to allow city council members to identify those
portions of the 2020-2023 Capital Improvement Program which they are
uncomfortable with.
History
At their July 16,2018 meeting the city council approved the 2019 portion of the
capital improvement program. However, council members had some concerns
about projects and replacements scheduled for subsequent years. Therefore, they
directed the staff to schedule the September 4, 2018 work session to allow the city
council to discuss their concerns.
Current Circumstances
Attached for city council information is the staff report and the 2019 to 2023
Capital Improvement Program elements the city council received for the July 16,
2018 Meeting.
ISSUES: Council members should review the Capital Improvement Program and determine
those things which they have questions about so that a discussion can take place.
At the conclusion of the session the hope is that all questions will have been
addressed and the city council could act upon the entire document at a
subsequent regular meeting recognizing that all projects contained in the Capital
Improvement Program must be approved a second time before they are actually
undertaken.
The projects contained in the capital improvement program for any year represent
the staff’s collective best judgement of the work that must be done to maintain our
infrastructure and to provide our employees with safe, dependable buildings and
equipment to accomplish their responsibilities. Quite a bit of project shuffling
occurs at the staff stages of the CIP.
We acknowledge that sometimes the costs of the proposed projects are greater
than may be desired in any year. Accordingly, we have moved equipment
purchase and projects back to save funds in the short run. The dilemma is that
such projects must ultimately be done and the longer we wait the more expensive
they become.
DIRECTION
SOUGHT:
Provide staff with specific direction regarding which projects should and should not
proceed and when they are to be accomplished if appropriate.
Advise the staff whether the city council desires that the remainder of the CIP be
placed upon a subsequent council agenda or take no action and proceed with only
one year of the CIP adopted.
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4646 Dakota Street SE
Prior Lake, MN 55372
CITY COUNCIL WORKSHOP REPORT
MEETING DATE: JULY 16, 2018
PREPARED BY: CATHY ERICKSON, FINANCE DIRECTOR
JASON WEDEL, PUBLIC WORKS DIRECTOR/CITY ENGINEER
PRESENTED
BY:
CATHY AND JASON
TOPIC: 2019-2023 CAPITAL IMPROVEMENT PROGRAM
DISCUSSION: Introduction
The purpose of this workshop is to complete a City Council review and receive input
regarding the proposed 2019-2023 Capital Improvement Program (CIP)
This year, the CIP Council Workshops are divided into two parts.
June 18 Workshop -Part 1: City Council review of the proposed 2019-2023 Capital
Improvement Program (CIP) for the following draft plans:
1) Transportation Plan
2) Equipment Replacement Plan
3) Park Plan
4) Facilities Management Plan
5) Street Overlay Plan
July 16 Workshop - Part 2: The remaining CIP draft plans, noted below, will be
reviewed at the July 16 Council workshop
1) Technology Plan
2) Water Operating Plan
3) Sanitary Sewer Operating Plan
4) Water Quality Operating Plan
History
Description of the Capital Improvement Plan (CIP)
Prior Lake’s five-year Capital Improvement Program is a planning tool used to support
the City’s 2040 Vision and Strategic Plan. Each year, forecasts for projects that will
be needed, estimated costs and possible funding sources are programmed into the
CIP for the next five years. The CIP is typically updated, evaluated and approved
each year by the City Council as projects are completed and priorities change. The
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purpose of the CIP is to assure that funds are available when projects are required to
meet community needs.
Current Circumstances
1. Technology Plan
The Technology Plan assists the City with planning for current and long-range
information technology needs, including hardware, software and other IT-related
items. See the “Technology Plan – 2019-2023 Proposed Expenditures” attachment for
more specific details of proposed significant annual expenditures.
The Technology Plan itself summarizes operating and capital expenditures in
accordance with our policy. This document is also attached. The expenditures
summarized in the Technology Plan are part of the General Fund tax levy. While this
plan is reflective of the needs of our various departments the actual request could
change as part of the budget review process. This plan is discussed as part of the
CIP because have an annual investment in technology and we need to plan for our
current and long-range IT needs.
2, 3 and 4. Water, Sewer and Storm Water Plans
Utility Capital Projects
As a reminder, the Water, Sewer, and Storm Water Plans include projects associated
with the Transportation Plan. This means that fund balances are directly impacted by
the transportation plan projects where there is utility reconstruction completed below
the street. (Funds will be transferred to the Construction fund for the utility cost portion
of street projects.) A copy of the transportation plan is attached for reference.
Minimal street reconstruction with utilities in 2019:
Due to the significant road projects in 2018 and 2019, Director Wedel is
recommending one smaller scale street rehab in 2019 with no utility related work.
The only 2019 utility work will be on the CR 21/TH13/Main Ave/Arcadia road project
for an estimated total of $100,000 and $250,000 for the water and street utilities
respectively. This will give us an opportunity to build cash reserves to fund some of
the future year projects in the 2019-2023 CIP.
Utility reconstruction on private streets in 2021
The transportation plan includes utility reconstruction on the Pershing/Dunkirk area
streets in 2021. At this time the utilities under the Inguadona area private streets will
also be reconstructed. The street portion of the cost for the Inguadona area private
streets is $591,570. This cost is shared equally between the Water and Sewer Funds
at $295,785 each and is included as a use of funds in the plans.
Council has directed staff to explore the establishment of a Utility Special District for
properties served by private streets. The Utility Special District funds will be collected
from the private street properties to help offset the cost to replace the private streets
after replacement of the public utilities below the street. This process will start with
discussions with HOAs/neighborhoods with private streets to provide education on the
use of the funds and respond to resident questions/ concerns. Staff anticipates that
this item will be brought to the Council for approval in 2019. Revenue estimate per
3
year for the special billing district for private streets is $200,000. The revenue is
shared equally between the Water and Sewer Funds at $100,000 each and has been
included as a source of funds in the plans starting in 2020. Staff has also included
use of funds for future private street replacement in the water and sewer plans.
Utility Rate Study
The city plans to issue an RFP for a utility rate study to be completed in 2019. The
use of funds for the rate study will be reflected in the plans, and the cost will be split
evenly between the water, sewer and water quality plans. The last utility rate study
was done in 2004. As part of the utility rate study/plan updates, staff plans to revisit
our tiered rate structure to address appropriate charges and number of tiers for high
consumption. Currently our summer water usage is up to 3 times our winter usage
which can be attributed directly to irrigation. The existing tiered rates have had
minimal impact on irrigation usage.
Moreover, some decades ago the city implemented a program which encouraged
water users to fill their pools early in the year so that water quantity would not be
included in the water usage average which determines the bi-monthly sewer usage
calculation. This appropriateness of this policy is to come under scrutiny as well (See
Sewer Plan discussion below).
Considering the significant investment the City is putting into infrastructure to support
these uses, it would be beneficial to adjust the tiered rates to collect additional
revenue from the users who are largely responsible for these capital improvement
costs.
Utility Billing System Upgrade
The Water and Sewer Plans include a use of funds of $70,000 for an upgraded utility
billing system. Incode, our utility billing vendor is requiring an upgrade from our
current version. Staff is considering changing to our current financial system vendor,
BS&A, so all financial modules are integrated within the same financial software
system, and due to the limitations of the Incode product. Staff is proposing to do a
RFP in 2019 with a 2020 implementation date.
Water Plan:
Water Purchase and Facility Expansion Agreement with the SMSC
In November 2017, the City Council approved the Water Purchase and Facility
Expansion Agreement between the City and the SMSC. The agreement sets the
water purchase price and funds a portion of the new water treatment facility costs for
construction of filter cells used for water storage.
The water plan has been updated to reflect the water purchase rate/1000 gallons
established in the agreement.
The water plan has also been updated in 2018 and 2019 to reflect expenditures of
1.5M and $600,000 respectively to construct the filter cells the city will use at the
new SMSC south plant (funding from the Water Storage Fund) and expenditures in
2019 of $1.3M to extend the raw watermain from Well 6 to the new water treatment
plant (funding from the Trunk Oversizing Fund).
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Utility Capital Projects:
The 2019-2023 Water Plan includes $3,711,250 in use of funds that will be
transferred to the Construction fund for the utility cost portion of street projects. This
includes about $296,000 for the Inguadona area private street replacement. The
contributions from the Water Utility Fund for transportation/ street projects varies by
year, based on the projects. The five-year (2019-2023) contribution average is about
742,000.
AMRS Project:
The budget for the annual cost of meter replacements has been reduced by $70,000,
as the city will replace approximately 6,000 meters as part of the Meter/Automated
Meter Reading System replacement project approved by the Council in June.
2019 Water Rates:
For 2019, staff recommends a minimal rate increase of 3% for the Water Plan to
cover estimated increases in operating and maintenance costs. For 2020 forward,
the rate structure will be based on the updated plans from our consultants.
Sewer Plan:
2018 Sanitary Sewer Rates:
Utility Capital Projects:
The 2019-2023 Sanitary Sewer Plan includes $2,593,905 in use of funds that will be
transferred to the Construction fund for the sanitary sewer utility cost portion of street
projects. This includes about $296,000 for the Inguadona area private street
replacement. The contributions from the Sewer Utility Fund for transportation/ street
projects varies by year, based on the projects. The five-year (2019-2023) contribution
average is about $519,000.
Concrete Sewer Lining Replacement:
We anticipate that there will be a use of funds for future concrete sewer lining
replacement. Over the ten-year period beginning in 2022, we have included costs of
1.9M.
Staff has been evaluating the impact of billed sewer flows on revenues and the
increase in capital project expenditures on the sewer fund reserves.
Summer Sewer Lock/Cost Break:
We bill sewer based on water consumption, however, we provide a summer sewer
lock. Residents pay the average of the Feb and April consumption for the June,
August, October and December billing cycle. The billing cycles cover the following
time periods highlighted in blue:
Month Billing Cycle
Feb Nov 21 - Jan 20
Apr Jan 21 - March 20
June March 21 - May 20
Aug May 21- July 20
Oct July 21-Sept 20
Dec Sept 21- Nov 20
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The summer sewer lock is intended to give consideration to pool filling, lawn and
garden sprinkling, etc. that do not flow into the sanitary sewer system. The summer
sewer lock was established years ago. This is reducing our annual billed sewer
consumption.
Our 2017 billed sewer consumption was about 529.3M gallons. Our MCES actual
flow was 612.2M gallons. The unbilled consumption is the due to the summer sewer
consumption lock and inflow & infiltration(I&I). I&I is the storm water and ground
water that comes from other sources than water consumption, such as wet weather
and enters the sanitary sewer through leaking sanitary sewer pipes and manholes. If
the city billed sewer based on actual water consumption, without the summer sewer
lock, we could generate the revenue needed to cover the actual MCES flow. The
additional revenue that could be generated for this unbilled flow was about $460,000
based on 2017 rates (MCES of $220,000 and City Sewer of $240,000).
Billing for sewer based on actual water consumption could have the added benefit of
encouraging water conservation.
Many cities provide a summer sewer lock to some level, but ours is more generous
than some. However, staff would like the Council to consider phasing this out. If this
is something that the Council is receptive to, staff will provide additional analysis and
phase out options.
Sewer Fund Balance:
Based on the current plans it is likely that the fund balance will drop below the
recommended amount in 2019.
Staff has identified several options the Council can consider to maintain an
appropriate fund balance in the Sewer Fund:
1. Increase the City portion of the sewer rate.
2. Consider modifying or phasing out the summer sewer lock.
3. Issue debt to fund at least a portion of the 2020/2021 $2.2M capital needs.
4. Consider postponing one or more projects to a future year.
5. Consider a combination of the above.
If no change is made to the current billing structure, Staff recommends an increase in
the City portion of the rate of $.60 and $.50 in 2019 and 2020 respectively. The
current city portion of the sewer rate is $2.94/1,000 gallons. If the average household
uses 8,000 gallons of water per month the proposed $0.60 increase would equate to
an additional $4.80 per month.
Staff would prefer to finance the sewer fund portion of the transportation projects on a
paygo basis instead of issuing debt. In 2018, we knew we had planned bonding for
the one-time AMRS replacement project, so a one-time financing of the utility portion
of a transportation project in conjunction with the bonding was a reasonable
approach. Staff would prefer not to issue debt annual to finance sewer fund capital
projects.
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The only sewer cost in 2019 is related to the CR21 project and that cannot be
delayed. The biggest portion of the proposed sewer cost in 2020 is for Fish Point
Road. That street is in very poor condition and would be difficult to delay. In 2021 we
are proposing to complete projects in the Pershing/Green Heights neighborhood,
including the private streets such as Inguadona. This will require significant funding
from the sewer fund. In 2022 we are proposing mostly full depth reclamation projects
to help ease the strain on the sewer fund. Based on this transportation plan there are
not a lot of opportunities to reduce the burden on the sewer fund in the near term.
For 2021 forward, the rate structure will be based on the updated utility rate study,
and Council consideration of the options outlined above
MCES impact on the Sewer Fund:
The Metropolitan Council Environmental Services (MCES) annual operating budget
plans for the resources necessary to support its two core functions: wastewater
collection and treatment and water resource planning. Based on the MCES budget
workshop information presented in May, the proposed 2019 cost increase is 7.25%.
The MCES sets the rates based on the actual flow from 2017 (two years prior
historical). The cost increase is comprised of two components as follows:
1) A volume increase of 2.8% based on the change in metered flow from 2016 to
2017.
2) A rate increase of 4.4%. The MCES total regional wastewater charge is up
3.5%. The total regional flow is down -.083%, but the cost is still spread over
the same users. The City of Prior Lake’s proportionate share results in a 4.4%
rate increase. The Sewer plan currently reflects a 7.5% increase in the
MCES cost, which will be adjusted if there is a change in the final information
that is received from the MCES in early August.
Storm Water Plan:
The Storm Water Plan includes pond maintenance and retrofit projects.
Utility Capital Projects:
The 2019-2023 Storm water plan includes $1,545,565 in use of funds that will be
transferred to the Construction fund for the storm water utility cost portion of street
projects. Staff is seeing an increase in annual stormwater infrastructure costs due to
increased regulation and requirements. A recent example is the cost for the Rolling
Oaks stormwater infrastructure which included land acquisition costs for the
construction of a filtration basin as well as SAFL Baffle inserts for all of the catch
basins. The SAFL Baffle is a stormwater pretreatment system that removes sediment
and chemicals. The SAFL Baffles alone were $36,540.
2019 Storm Water Rates:
For 2019, staff recommends a rate increase of 5% for the Storm Water Plan due to
the increase in stormwater project costs that we are experiencing. The cost for the
Huron area streets stormwater work is estimated at $348,000. With this project, the
city earns credit toward future stormwater project costs. As this credit is earned, staff
will adjust the stormwater plan costs accordingly, which may result in a reduction in
future use of funds. For 2020 forward, the rate structure will be based on the updated
rate study.
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ISSUES:
Conclusion
Once the City Council has completed the review of the CIP plans, and provided
direction on project priorities by plan, staff will make any revisions before the public
presentation.
Council direction is specifically needed on the following items:
Proposed rate increases for the utility plans. The water and storm water
recommended rate increases are minimal, but the city sewer rate increase is
proposed at $.60 and $.50 for 2019 and 2020 respectively. If the sewer rate
lock is phased out, the proposed rate increases could be reduced.
Any projects Council is hesitant about proceeding with that are programmed in
the CIP.
Any technology plan proposed upgrades or purchases for 2019.
Whether the CIP tax levy impact proposed for 2019 is acceptable.
A public presentation for the CIP is scheduled at the Council meeting on Monday,
August 6
FINANCIAL
IMPACT:
In reviewing the 2019-2023 Capital Improvement Program, the City Council should
consider the annual tax impact of the scheduled projects.
CIP Bonding:
The 2019-2023 CIP includes projects that are funded by bond proceeds. Bonds are
issued for the project costs that the City is funding through tax levies as well as the
costs that are specially assessed to property owners.
The 2019-2023 CIP anticipates the following bonding needs:
Transportation Plan projects for 2019-2023 of $14,403,000.
Bonding for the following major facility repairs, equipment replacements and
water/sewer plan capital projects by year:
Year Major Facility
Repairs
Equipment
Replacements
2019 - 325,000
2020 - -
2021 600,000 725,000
2022 - -
2023 - -
The equipment replacements are a Fire water tanker and pumper in 2019 and 2021
respectively.
The major facility expenditures are for City Hall and Police Station HVAC/carpet/ wall
coverings, and the Maintenance Center front parking lot and crane.
Summary of Projected Debt Balances
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The chart below reflects the cumulative effect of proposed new debt issued and the
retirement of existing debt. The green line is the resulting total debt balance at the
end of the year.
Bond Repayment through Debt Service Tax Levy:
The impact of the 2019-2023 CIP and other anticipated bond payment adjustments on
the debt service property tax levy are reflected in the following tables.
Projected five-year annual change in debt levy:
The table below indicates that we are adding more CIP debt annually than the
existing debt that is falling off. In 2018 we bonded for the following projects, which
resulted in an estimated annual net debt levy average of $541,000.
Fire Pumper Replacement
Fire Station #2 SCBA and Parking Lot Replacement
2018 Street Improvement Projects
o Franklin Area
o Huron Area
2018 Street Reconstruction Projects
o Duluth Ave/TH 13
o County Wide Flashing Yellow Signal Conversion
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Projected change in total CIP Tax Levy:
The funds/plans that have a CIP tax levy are shown below. The table below shows
the projected change in the CIP tax levy by component. For 2019, the estimated
increase in the tax levy for all CIP components for 2019 is 3.1%
Option to use Revolving Park Equipment Fund Reserves:
Upon further review of the Revolving Park Equipment Fund, staff is projecting
adequate fund balance to cover one mile ($100,000 cost) of trail replacement in 2019.
Based on this, Council could consider funding one mile of trail replacement in 2019
with Revolving Park Equipment Fund reserve. This will allow us to begin the annual
process of trail replacement without impacting the tax levy in 2019. The Revolving
Park Plan proposes an increase in the tax levy for trails, etc. of $100,000 annually
until 2024 when the levy is proposed at $425,000. By using fund reserves, we are not
building the trail replacement program as planned, and will not be able to sustain our
trail replacement.
The table below summarized the annual projected total CIP tax levy by component.
2019 2020 2021 2022 2023
Debt:
Existing CIP (425,209) ( 162,795) 12,313 (24,001) (223,176)
New CIP 545,639 242,296 319,059 359,849 396,308
Market Referendum 6,866 7,000 11,720 1,150 10,770
Change in Debt Levy 127,296 86,501 343,092 336,998 183,903
2019-2023 CIP Projected Change in Debt Levy
Tax Levies:2019 2020 2021 2022 2023
Equipment Revolving Fund 50,000 - - - -
Revolving Park Equip Fund 101,108 93,984 94,373 105,183 271,081
Facilities Management Fund - 30,000 50,000 - 25,000
PIR Fund 95,000 80,000 - 10,000 -
Debt Service 127,296 86,501 343,092 336,998 183,903
Total CIP Tax Levies 373,404 290,485 487,465 452,181 479,984
0.031
2019-2023 CIP Projected Change in CIP Tax Levy
2019 - Estimated % Increase in Tax Levy for
CIP components only
Tax Levies:2019 2020 2021 2022 2023
Equipment Revolving Fund 600,000 600,000 600,000 600,000 600,000
Revolving Park Equip Fund 339, 292 433,276 527, 649 632,832 903, 913
Facilities Management Fund - 30,000 80,000 80,000 105, 000
PIR Fund 95,000 175,000 175,000 185,000 185,000
Debt Service 3,497,468 3,583,968 3,927,061 4,264,059 4,447,962
Total CIP Tax Levies 4,531, 760 4,822, 244 5,309, 710 5,761,891 6,241,875
2019-2023 CIP Projected CIP Tax Levy
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The projected debt service shown above is based on the 2018A bond issue financing
plan. Staff will update the debt service based on the July 16 finalized 2018A bond
issue results. The updated information will be presented at the CIP Public Hearing.
This project debt service levy estimate for years 2019-2023 is based on ten-year level
annual debt service payments.
Bond Repayment Debt Service supported by Water and Sewer Fund Revenues:
Revenues of the Water and Sewer Funds support the annual debt service for the
Water Treatment Plant debt refunding bond issues, the AMRS replacement, and the
Huron area street improvements. Utility Fund projected annual debt service is shown
below:
Based on Council direction, updated financial information related to the impact of the
proposed CIP on debt levels, fund balance reserves and average utility customer will
be distributed as part of the public presentation on the CIP at the Monday, August 6
Council meeting.
Approval of the CIP does not obligate the City to complete the proposed projects or
purchases. The 2019 projects/proposed purchases will be incorporated into the 2019
budget requests for budgeted funds. Further Council approvals may be necessary to
comply with state statutes and the city’s purchasing policy.
RECOMMENDED
ACTION:
The Council should provide comments on the elements of the plan in order that the
CIP process can proceed as planned.
Attached are the following documents for Council review and discussion at the
workshop:
2019-2023 CIP Plan select pages:
1) Technology Plan – 2019-2023 Proposed Expenditures
2) Technology Plan
3) Water Operating Plan
4) Sanitary Sewer Operating Plan
5) Water Quality Operating Plan
http://splash/teams/am/October 4 2010/07 16 2018/2019-2038 Technology Plan Budget Justification.docx
Plan Technology Plan – 2019-2023 Proposed Expenditures
General Fund
Computer Replacement
includes work station, lap tops,
tough books, iPads, etc.)
2019: $ 26,520
2020: $20,285
2021: $19,670
2022: $25,917
City computers are on a six-year replacement schedule and laptops/tough
books on a five-year replacement schedule.
Website Redesign 2019: $45,000
2020: $8,000 (annual license fee)
2021: $8,000
2022: $8,000
Redesign of city website. An external audit of city’s network security
indicated that the platform on which the city’s website resides is a
security risk for hackers because the programming is outdated and no
longer supported. New website would include email sign up on specific
topics and capability to send alerts. Updated website would allow for live
stream of Council meetings, which current system cannot support.
Phone System Replacement 2019: $70,000 Current city phone system is over 12+ years old and failing. The new
phone system combines 7 buildings’ phone systems into one.
Managed Services Contract
virtual Helpdesk)
2019: $23,000 This contract would provide virtual Helpdesk support. Rather than hire
additional FTEs at this time to support our IT Department, this contract
would provide Helpdesk support as well as regular monitoring of our
network to prevent ransomware, hackers and other security threats.
recurring annual cost moving forward)
Copiers 2021: $18,731 (large map)
2022: $8,500 (Public Works)
2023: $10,000 (Police)
Copier replacements.
Servers 2020 - $8,758
2021 - $8,845
Replacement/upgrade of physical servers that run all city virtual servers.
Epson Projector 2020 - $5,667 Replacement of Parkview Conference Room projector.
http://splash/teams/am/October 4 2010/07 16 2018/2019-2038 Technology Plan Budget Justification.docx
NIMBLE SANS Controller 2019 - $16,000 Upgrade the interface to the City’s network on the storage controller unit
for virtual servers.
Citizens Online Portal 2019 - $15,914
Split between general/water/sewer funds)
Online service request module for public works complaints.
Water Fund
BS&A Utility Billing System 2019 - $17,552
2020 - $17,552
Switch from Incode to BS&A for water meter reading replacement
project.
Sewer Fund
BS&A Utility Billing System 2019 - $17,552
2020 - $17,552
Switch from Incode to BS&A for water meter reading replacement
project.
Cable Fund
Tightrope Channel 2022 - $7,727 Replacement of playback system on cable channel. Part of three-year
Council Chamber audio/visual enhancement project.
Audio System for Chambers 2019 - $15,000 Part of three-year Council Chamber audio/visual enhancement project.
DRAFT 07/16/2018
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Use of Funds:
Hardware
Administration 7,534$ 10,976$ 7,393$ 6,997$ 6,168$ 10,468$ 8,465$ 10,578$ 7,541$ 7,120$
Building Inspection/Engineering 3,570 1,133 - - 6,263 2,984 3,790 1,203 - -
Community/Economic Development 2,150 6,800 1,041 2,102 1,168 1,179 - 7,218 1,105 1,116
Finance 1,122 2,576 - 3,363 1,000 2,573 1,191 2,734 - 3,570
Fire - 8,655 - - - - - - - -
Police 16,934 2,885 8,949 10,993 6,062 14,903 21,007 8,312 5,413 8,880
Public Works 7,161 3,503 7,284 7,462 5,095 6,218 7,905 3,719 5,744 7,921
Cable Television 17,805 18,958 - 7,883 - 37,413 - 2,734 4,584 77,323
Printers/Scanners 3,162 3,946 22,576 24,504 21,316 15,975 1,083 7,929 3,424 6,694
Network Infrastructure 19,117 22,258 30,867 14,322 14,752 68,801 15,650 25,416 25,993 17,101
Miscellaneous 250 6,697 3,642 1,997 - - - - - -
Total Hardware 78,805$ 88,385$ 81,752$ 79,623$ 61,824$ 160,514$ 59,092$ 69,843$ 53,803$ 129,724$
Software
Existing / Maintenance / Upgrades 169,958$ 173,217$ 138,278$ 139,591$ 143,760$ 148,055$ 152,479$ 157,035$ 166,558$ 166,562$
Proposed Software 175,314 9,500 9,500 9,500 - - - - - -
Total Software 345,272$ 182,717$ 147,778$ 149,091$ 143,760$ 148,055$ 152,479$ 157,035$ 166,558$ 166,562$
Total Use of Funds 424,077$ 271,102$ 229,531$ 228,713$ 205,585$ 308,570$ 211,570$ 226,879$ 220,361$ 296,286$
Source of Funds:
General Fund 295,847$ 148,835$ 163,031$ 143,115$ 134,687$ 197,107$ 134,502$ 143,428$ 138,097$ 133,680$
Water Fund 54,804 52,897 33,980 35,914 34,063 36,800 39,873 41,651 38,594 39,488
Sewer Fund 53,682 50,013 32,107 41,379 35,230 36,800 36,733 38,588 38,594 45,289
Water Quality Fund 1,938 400 412 424 1,604 450 463 477 492 506
Cable Franchise Fund 17,805 18,958 - 7,883 - 37,413 - 2,734 4,584 77,323
Total Source of Funds 424,077$ 271,102$ 229,531$ 228,713$ 205,585$ 308,570$ 211,570$ 226,879$ 220,361$ 296,286$
Net Source (Use) of Funds -$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Operating Budget 216,864$ 204,346$ 187,252$ 203,327$ 184,268$ 214,054$ 211,570$ 217,582$ 210,972$ 212,270$
Capital Improvement Plan 207,213$ 66,756$ 42,279$ 25,386$ 21,316$ 94,515$ -$ 9,296$ 9,389$ 84,017$
Source of Funds (Operating Budget):
General Fund 149,348$ 124,911$ 120,752$ 123,414$ 113,371$ 131,063$ 134,502$ 134,132$ 128,708$ 126,986$
Water Fund 31,947 35,345 33,980 33,071 34,063 35,728 39,873 41,651 38,594 39,488
Sewer Fund 30,825 32,460 32,107 38,536 35,230 35,728 36,733 38,588 38,594 45,289
Water Quality Fund 1,938 400 412 424 1,604 450 463 477 492 506
Cable Franchise Fund 2,805 11,230 - 7,883 - 11,086 - 2,734 4,584 -
Total Source of Funds: Op. Budget 216,864$ 204,346$ 187,252$ 203,327$ 184,268$ 214,054$ 211,570$ 217,582$ 210,972$ 212,270$
Source of Funds (CIP):
General Fund 146,499$ 23,924$ 42,279$ 19,700$ 21,316$ 66,044$ -$ 9,296$ 9,389$ 6,694$
Water Fund 22,857 17,553 - 2,843 - 1,072 - - - -
Sewer Fund 22,857 17,553 - 2,843 - 1,072 - - - -
Water Quality Fund - - - - - - - - - -
Cable Franchise Fund 15,000 7,727 - - - 26,327 - - - 77,323
Total Source of Funds: CIP 207,213$ 66,756$ 42,279$ 25,386$ 21,316$ 94,515$ -$ 18,686$ 9,389$ 644,185$
CITY OF PRIOR LAKE
2019 - 2028 TECHNOLOGY PLAN
CITY OF PRIOR LAKE Draft 7/16/2018
2019 - 2028 WATER OPERATING PLAN
2019-2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 2,028,101$ 2,129,506$ 2,235,981$ 2,347,780$ 2,465,169$ 2,588,428$ 2,717,849$ 2,853,742$ 2,996,429$ 3,146,250$ 25,509,236
Capital Projects 2,132,130 1,323,743 2,473,325$ 650,088$ 805,387$ 2,090,924$ 1,055,477$ 1,059,392$ 1,063,423$ 1,067,576$ 13,721,467
Interfund Transfer 350,220 358,630 372,286$ 381,209$ 395,393$ 404,859$ 414,600$ 424,639$ 434,979$ 445,631$ 3,982,446
Debt Service 698,369 707,173 725,762$ 736,630$ 763,950$ 770,985$ 786,617$ 784,292$ 790,958$ 797,875$ 7,562,611
Total Use of Funds 5,208,820 4,519,052 5,807,355 4,115,707 4,429,899 5,855,196 4,974,544 5,122,065 5,285,789 5,457,332 50,775,760
Source of Funds:
Water Usage Charge 4,071,504 4,237,529 4,409,881 4,588,792 4,774,504 4,967,268 5,025,398 5,083,527 5,286,874 5,497,898 47,943,173
Special Utility Billing District 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 900,000
Other Revenues 115,000 117,300 119,646 122,039 124,480 126,969 129,509 132,099 134,741 137,436 1,259,218
Bond Proceeds - - - - - - - - - - 0
Trunk Fund Contribution 1,900,000 - - - - - - - - - 1,900,000
Total Source of Funds 6,086,504 4,454,829 4,629,527 4,810,831 4,998,984 5,194,238 5,254,906 5,315,626 5,521,615 5,735,333 49,202,391
Change in Fund Balance 877,684$ (64,223)$ (1,177,828)$ 695,123$ 569,085$ (660,959)$ 280,362$ 193,561$ 235,826$ 278,001$ (1,573,368)$
Beginning Fund Balance 3,557,191$ 4,434,874$ 4,370,651$ 3,192,823$ 3,887,946$ 4,457,031$ 3,796,072$ 4,076,434$ 4,269,995$ 4,505,821$ 4,783,822$
Ending Fund Balance 4,434,874$ 4,370,651$ 3,192,823$ 3,887,946$ 4,457,031$ 3,796,072$ 4,076,434$ 4,269,995$ 4,505,821$ 4,783,822$ 3,210,454$
CITY OF PRIOR LAKE Draft 7/16/2018
2019 - 2028 SANITARY SEWER OPERATING PLAN
2019-2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 1,065,866$ 1,097,842$ 1,130,777$ 1,164,701$ 1,199,642$ 1,235,631$ 1,272,700$ 1,310,881$ 1,350,207$ 1,390,713$ 12,218,959
MCES Fees 1,591,810 1,692,094 1,798,426 1,911,162 2,030,675 2,157,362 2,291,641 2,433,954 2,584,769 2,744,581 21,236,473
Capital Improvement Projects 487,136 722,660 1,437,794 638,032 1,014,173 1,024,480 1,055,861 1,088,536 1,121,443 1,154,586 9,744,701
Interfund Transfer 277,147 283,365 294,763 301,361 313,149 320,148 327,348 334,769 342,412 350,288 3,144,749
Debt Service 152,383 153,123 155,243 157,180 153,930 155,550 156,905 152,985 153,925 154,575 1,545,798
Total Use of Funds 3,574,343 3,949,083 4,817,003 4,172,435 4,711,569 4,893,171 5,104,454 5,321,125 5,552,756 5,794,743 47,890,680
Source of Funds:
Wastewater Collection Revenue 3,825,279 4,233,878 4,417,394 4,609,349 4,810,171 5,020,309 5,240,236 5,470,450 5,656,072 5,850,691 49,133,831
Special Utility Billing District 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 900,000
Other Revenues 15,300 15,606 15,918 16,236 16,561 16,892 17,230 17,575 17,926 18,285 167,531
Bond Proceeds - - - - - - - - - - -
Total Source of Funds 3,840,579 4,349,484 4,533,312 4,725,586 4,926,733 5,137,202 5,357,466 5,588,025 5,773,999 5,968,976 50,201,361
Change in Fund Balance 266,237$ 400,401$ ( 283,691)$ 553,151$ 215,164$ 244,031$ 253,013$ 266,900$ 221,243$ 174,233$ 2,310,681$
Beginning Fund Balance 1,413,219$ 1,679,456$ 2,079,856$ 1,796,165$ 2,349,316$ 2,564,480$ 2,808,511$ 3,061,524$ 3,328,424$ 3,549,666$
Ending Fund Balance 1,679,456$ 2,079,856$ 1,796,165$ 2,349,316$ 2,564,480$ 2,808,511$ 3,061,524$ 3,328,424$ 3,549,666$ 3,723,900$
CITY OF PRIOR LAKE Draft 7/16/2018
2019- 2028
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Totals
Use of Funds:
Operations & Maintenance 631, 581$ 511,707$ 524, 207$ 537, 072$ 560, 313$ 563,942$ 577,972$ 592,415$ 607,281$ 622,586$ 5,729,078$
Capital Projects 385, 000 499,835 740, 250 319, 760 855, 720 431,152 706,152 706,152 706,152 706,152 6,056,325
Total Use of Funds 1,016, 581 1,011,543 1,264, 457 856, 832 1,416, 033 995,094 1,284,124 1,298,567 1,313,433 1,328,738 11,785,403
Source of Funds:
Interest Earnings (1.5%)11,688$ 6,243$ 5,915$ 6,324$ 4,356$ 8,322$ 6,160$ 9,541$ 9,519$ 9,759$ 77,827$
Charges for Services 978, 675 1,038,056 1,101, 040 1,167, 846 1,238, 705 1,257, 285 1,276,145 1,308,240 1,341,142 1,374,871 12,082,004
Grants - - - - - - - - - - -
Total Source of Funds 990, 363 1,044,299 1,106, 955 1,174, 170 1,243, 060 1,265, 607 1,282,305 1,317,782 1,350,663 1,384,633 12,159,837$
Change in Fund Balance (26,218)$ 32,756$ (157, 502)$ 317, 338$ ( 172, 973)$ 270,514$ (1,820)$ 19,215$ 37,229$ 55,896$ 374,434$
Beginning Fund Balance 499, 406$ 473,188$ 505, 943$ 348, 441$ 665, 779$ 492,806$ 763,319$ 761,499$ 780,713$ 817,941$
Ending Fund Balance 473, 188$ 505,943$ 348, 441$ 665, 779$ 492, 806$ 763,319$ 761,499$ 780,713$ 817,941$ 873,833$
2019 - 2028 WATER QUALITY OPERATING PLAN
Page 1
City of Prior Lake, Minnesota
8,745,000
General Obligation Bonds, Series 2018A
Bond Sale Summary
July 16, 2018
PURPOSE: Proceeds from the Bonds will be used to purchase equipment; to finance a capital
improvement plan project, an improvement project, a permanent improvement revolving
fund project, a water project, a sewer project, a street reconstruction project and to
finance the costs associated with the issuance of the Bonds.
FINANCE PLAN: The Capital Improvement Plan Portion, the Improvement Portion, the Water Portion, the
Sewer Portion and the Street Reconstruction Portion of the Bonds have been structured
over 10 years, with relatively level annual debt service payments. The Equipment
Portion has been structured over nine years, with relatively level annual debt service
payments. The PIR Fund Portion has been structured over five years with relatively level
annual debt service payments.
RESULTS:
The City received seven bids.
Bonds were purchased by Piper Jaffray, Minneapolis, Minnesota.
Bonds were rated AA+ by S&P.
Final
on
07/ 16/2018
Finance
Plan
06/ 18/2018
Par Amount $8,270,000* $8,745,000
Average Interest Rate 4.61% 2.79%
All Inclusive Cost (AIC) 2.56% 3.07%
True Interest Cost (TIC) 2.41% 2.93%
Final par amount was reduced by the reoffering premium and rounding on the Equipment, CIP
and Improvement portions of the Bonds.
Page 2
EXHIBIT A – SOURCES AND USES
Equipment CIP Improvement PIR Fund Water Sewer
Street
Reconstruction
Issue
Summary
Sources Of Funds
Par Amount of Bonds $605,000.00 $560,000.00 $2,655,000.00 $490,000.00 $ 1,320,000.00 $1,320,000.00 $ 1,320,000.00 $8,270,000.00
Reoffering Premium 69,561.85 69,643.00 330,934.70 34,493.30 167,617.50 167,617.50 167,617.50 1,007,485.35
Total Sources $674,561.85 $629,643.00 $2,985,934.70 $524,493.30 $ 1,487,617.50 $1,487,617.50 $ 1,487,617.50 $9,277,485.35
Uses Of Funds
Deposit to Project Construction Fund 665,000.00 620,000.00 2,940,000.00 485,000.00 1,300,000.00 1,300,000.00 1,300,000.00 8,610,000.00
Deposit to Project Construction Fund (Premium)---31,238. 72 165,380.69 165,380.69 165, 380.69 527, 380.79
Costs of Issuance 5,353.52 4,955.36 23,493.71 4,335.94 11,680.49 11,680.49 11,680.49 73,180.00
Total Underwriter's Discount (0.459%)2,775.27 2,568.84 12,179.06 2,247.74 6,055.12 6,055.12 6,055.12 37,936.27
Deposit to Construction Fund (Unused Discount)2,063.05 1,909.60 9,053.55 1,670.90 4,501.20 4,501.20 4,501.20 28,200.70
Rounding Amount (629.99)209.20 1,208.38 ----787.59
Total Uses $674,561.85 $629,643.00 $2,985,934.70 $524,493.30 $ 1,487,617.50 $1,487,617.50 $ 1,487,617.50 $9,277,485.35
EXHIBIT B – PRICING SUMMARY
Maturity Type of Bond Coupon Yield
Maturity
Value Price YTM Call Date Call Price Dollar Price
12/15/2019 Serial Coupon 4.000%1.550% 760,000.00 103.219% ---784,464.40
12/15/2020 Serial Coupon 4.000%1.700% 860,000.00 105.237% ---905,038.20
12/15/2021 Serial Coupon 4.000%1.800% 805,000.00 107.084% ---862,026.20
12/15/2022 Serial Coupon 4.000%1.900% 835,000.00 108.693% ---907,586.55
12/15/2023 Serial Coupon 4.000%2.000% 870,000.00 110.067% ---957,582.90
12/15/2024 Serial Coupon 4.000%2.150% 790,000.00 110.897% ---876,086.30
12/15/2025 Serial Coupon 5.000%2.270% 805,000.00 118.343% ---952,661.15
12/15/2026 Serial Coupon 5.000%2.380% 830,000.00 119.695% ---993,468.50
12/15/2027 Serial Coupon 5.000%2.450% 870,000.00 119.112%c 2.672%12/15/2026 100.000%1,036,274.40
12/15/2028 Serial Coupon 5.000%2.510% 845,000.00 118.615%c 2.902%12/15/2026 100.000%1,002,296.75
Total ---$8,270,000.00 -----$9,277,485.35
Bid Information
Par Amount of Bonds $8,270,000.00
Reoffering Premium or (Discount)1,007,485.35
Gross Production $9,277,485.35
Total Underwriter's Discount (0.459%)$(37,936.27)
Bid (111.724%)9,239,549.08
Total Purchase Price $9,239,549.08
Bond Year Dollars $48,636.67
Average Life 5.881 Years
Average Coupon 4.6100679%
Net Interest Cost (NIC)2.6166149%
True Interest Cost (TIC)2.4108861%
Page 3
EXHIBIT C – DEBT SERVICE SCHEDULE
Date Principal Coupon Interest Total P+I Fiscal Total
08/15/2018 -----
06/15/2019 --303,583.34 303,583.34 -
12/15/2019 760,000.00 4.000%182,150.00 942,150.00 1,245,733.34
06/15/2020 --166,950.00 166,950.00 -
12/15/2020 860,000.00 4.000%166,950.00 1,026,950.00 1,193,900.00
06/15/2021 --149,750.00 149,750.00 -
12/15/2021 805,000.00 4.000%149,750.00 954,750.00 1,104,500.00
06/15/2022 --133,650.00 133,650.00 -
12/15/2022 835,000.00 4.000%133,650.00 968,650.00 1,102,300.00
06/15/2023 --116,950.00 116,950.00 -
12/15/2023 870,000.00 4.000%116,950.00 986,950.00 1,103,900.00
06/15/2024 --99,550.00 99,550.00 -
12/15/2024 790,000.00 4.000%99,550.00 889,550.00 989,100.00
06/15/2025 --83,750.00 83,750.00 -
12/15/2025 805,000.00 5.000%83,750.00 888,750.00 972,500.00
06/15/2026 --63,625.00 63,625.00 -
12/15/2026 830,000.00 5.000%63,625.00 893,625.00 957,250.00
06/15/2027 --42,875.00 42,875.00 -
12/15/2027 870,000.00 5.000%42,875.00 912,875.00 955,750.00
06/15/2028 --21,125.00 21,125.00 -
12/15/2028 845,000.00 5.000%21,125.00 866,125.00 887,250.00
Total $8,270,000.00 -$2,242,183.34 $ 10,512,183.34 -
Date And Term Structure
Dated 8/15/2018
Delivery Date 8/15/2018
First available call date 12/15/2026
Call Price 100.000%
Yield Statistics
Bond Year Dollars $48,636.67
Average Life 5.881 Years
Average Coupon 4.6100679%
Net Interest Cost (NIC)2.6166149%
True Interest Cost (TIC)2.4108861%
All Inclusive Cost (AIC)2.5634188%