00:00:00,467 S1: We know it's 530 and we are in the Veterans conference room of Mandan City Hall. This is a special meeting of the city Commission, and it is July 29th, 2025. Abby, would you be so kind as to lead us in the pledge? Yes, sir. Neville Chamberlain. 00:00:25,467 S2: I pledge allegiance to the flag of the United States of America and to the Republic for which it stands. One nation under God, indivisible, with liberty and justice for all. 00:00:39,767 S1: Mr. Neubauer, would you please take the roll? 00:00:43,467 S3: Commissioner John. Here. Commissioner. Mr. Brown? Yes. Mr. Schulberg here. Mayor Frick. 00:00:50,267 S1: Here. 00:00:53,467 S1: Commissioners, you have the agenda in front of you. Make a motion to approve tonight's agenda. Second, a motion by Commissioner Henshaw. Second by Commissioner Roger. Any discussion? Hearing none. Roll call. 00:01:09,000 S3: Commissioner Henson. Yes, Commissioner. Roger. Yes, Commissioner. Braun. Yes, Commissioner. Schober. Yes. Mayor. 00:01:16,167 S1: Yes. We'll move on to new business. Item number one. Presentation of capital improvement plans by more engineering and advanced engineering and environmental services. 00:01:30,467 S4: Yes. I'm going to kind of kick us off here. Uh, what we're going to be doing today is basically an overview of, uh, how we got to the point where we're at today. And then, um, a quick presentation of what the final deliverables looked like. Um, once again, going over this, uh, there were two parallel efforts. He was, um, in charge of the utility focus projects where the transportation focused projects were included in Included more where there was overlap, they were represented in both documents with coordinated data. We went through that project priority at prioritization as a group, and this prioritization system was based on two, um, uh, two uh. 00:02:17,868 S4: Items. That was individual project scores and merit criteria weights. Um, we identified, uh, individual project scores in 12 different, um, merit criteria for all 70 ish projects that we looked at. And then, um, we took, um, commissioner input and staff input to assign merit criteria weights to the project, to the projects. And we came up with a prioritization list, and we were able to split the projects into high, medium and low priority projects based on that kind of system. 00:02:54,467 S4: Um, after that. And this kind of what has happened since our last meeting is we have been iterating with finance. Um, we identified non-negotiable projects. Um, and the non-negotiables were typically projects that had alignment with outside funding sources and were urgent. Health and safety had urgent health and safety issues associated with the project. Um, the projected utility fund spans, um, that were identified in those non-negotiable projects informed the utility rate study, which um, uh finance and uh, Nexus will be presenting on later. After that, um, we identified high priority discretionary projects, uh, projects that were identified as negotiable, and we reallocated municipal infrastructure funds to offset the utility funds for those projects. Um, and the results are capital improvement plans that include both funded and unfunded projects. So we kept all of the information for the projects that didn't ultimately get end up getting funded. Um, just for information purposes and for possible future flexibility. Um. 00:04:08,267 S4: But, uh, we have, uh. 00:04:13,267 S4: Um, kind of fiscally constrained, fiscally constrained version of our five year CIP and then a non constrained version of our CIP. Um, with that, I will have maybe Laith, if you want to go through some of your slides. 00:04:29,367 S1: Yeah. 00:04:29,567 S5: Be happy to lay hands with you to us. Um, can you just do the next slide. 00:04:35,868 S4: If I can? 00:04:38,267 S5: Uh, so Eric mentioned we took a utility focus, uh, sewer talking, uh, wastewater treatment, collection, distribution and water treatment and looking at the city utilities. Um, the ultimate deliverable, uh, was kind of an Excel workbook that works better for finance with how the projects are spread out over years. Uh, it's got a GIS exhibit that shows kind of a snapshot of the city with where the projects are. Uh, with some tables supporting water, transportation, wastewater, stormwater. So you can get a, a frame of reference for where those projects are happening. And then the last part is a report that has kind of AA1 page summary. What is the project? Uh, why is the city, what are the funding sources? Um, so that deliverable was, uh, provided at one of the previous workshops, uh, for the city to use as a planning to move forward. 00:05:32,367 S5: Uh, the projects that were identified and discussed that ultimately went into that we used what resources were available. So the city has invested in master planning studies looking at population projections, uh, age of infrastructure, upcoming regulations, uh, to plan projects for the next 20 years. Some of those are a little more dated than others, but we did use that information as we went into the capital improvement plan. Uh, there are regulatory drivers. Uh, every year there seems to be a newer thing that comes out. One of the bigger ones right now is lead service line replacements. There's a big focus on that, uh, growth as the city continues to expand. That unlocks different parts of the cities with the stations, uh, towers, pump stations, things like that. Uh, aging infrastructure. You currently have several street projects that are targeting cast iron pipe replacement that you've been battling a lot of pipe breaks. Uh, the grants will probably expand on a little bit more than just coordination with city staff. Uh, there's a lot of value just to understand what problems the city staff are dealing with. Sometimes that brings out other projects that need to be addressed. So all of those different things were discussed in working sessions with staff. And that's ultimately what would inform the plan. 00:06:53,667 S5: So these are just blowups of the tables that are included on that that GIS exhibit. Uh, the highlighted ones were kind of the non-negotiable ones that were, uh, kind of vetted as part of the the working sessions that the commission was able to participate in. Um, I don't I be happy to discuss any of these projects in detail, but, uh, just high level, um, the drivers for the the reason that the city is looking at doing these projects is on that. Right? So again, that aging infrastructure growth or regulatory, uh, portions coming up, and then this is just kind of a snapshot of the water system. You can see, uh, the majority of those are service line replacement ones, which it's a regulatory driver. Uh, Jared has been actively working on documenting all of the service lines within the city and is currently working on plans of target Target's replacement. 00:07:48,367 S5: Is causing any questions? 00:07:56,701 S3: Just take a look here. 00:07:59,400 S5: Uh, correct. That, uh, graph is a GIS exhibit. It should be one of the first pages. Yeah. 00:08:09,567 S5: Uh, sorry to be a little confusing. So there were two different documents. Um, I apologize, I didn't bring any hard copies for the commission tonight. The one that you got in front of you is the Constitution. 00:08:19,901 S4: Here's the here's the. 00:08:22,000 S1: Digital. 00:08:22,367 S3: Partition. 00:08:24,767 S4: Looking for. 00:08:28,000 S5: Yeah. So the the graph itself is on that second page. Uh, keep going up. Okay. 00:08:36,000 S2: Um. 00:08:36,567 S5: Right there. So that that snapshot is that water system table. It's on that second page. 00:08:48,067 S5: Uh, then looking into the wastewater system. This is wastewater collection again, the yellow highlighted or the non-negotiable ones. Uh, we've talked about the wastewater treatment plant expansion. And for that, just with aging infrastructure and growth of the city, a lot of those systems are at or near capacity. Um, and then the other one was the lift station currently being decommissioned. Since the city's growing and expanding and providing other ways for that wastewater to flow through there. So a lot of these are just aging infrastructure growth needs. 00:09:22,100 S5: And then, uh, the general storm system improvements, these are some outliers. The the, uh, land property storm issues. And the commission's heard about some of these. Um, I think they had the property owners approach the commission to provide an update. This is just to try to address some of the stormwater items in that area in the cemetery. Bank stabilization bluff near Union Cemetery. This is to address that. 00:09:53,868 S5: And I'll be happy to answer questions on any specific project. Otherwise, just to provide a general. 00:10:01,100 S1: Cemetery where we have to. 00:10:05,467 S5: Um, great question. I guess, uh, Riley. 00:10:10,300 S1: Uh, so we got approval. 00:10:12,567 S4: From. 00:10:12,868 S1: Regent eight, um, FEMA, uh, for funding. 00:10:17,467 S4: However, uh, there was. 00:10:18,968 S6: A, I believe, executive order that those, uh, funding needs to be signed off by the secretary of FEMA. Uh, so from my understanding, is currently at her desk. Jared has any further updates on that, but that's kind of the last we talked about. 00:10:31,868 S7: It's just still in the study phase. There's, um, there's a lot of monitoring things up there right now. So obviously we can see is what you can see but exactly where I was living as part of the study. We want to be able to fund that project. We need a detailed study of exactly what's going on. So what's. 00:10:54,167 S1: Your agency? 00:10:55,367 S7: What are we. 00:10:56,100 S1: What do you do? Is it inches to feet? Or could you just have a wake up one morning in a catastrophic zone? 00:11:07,901 S7: So that's your bed? Um, but yes. Um, uh, like I said, right now, we're we're monitoring a lot of these slides. Um, what we can see is what we can see, but we've got, um, we've got equipment down to the ground. And I'd love to show you the report because, um, it's it's it's just a matter of identifying your plans exactly where they're happening. And if we fix it wrong, spend that money on or good money on bad things. But we're just not ready yet. It's going to it's going to take another few months of monitoring. Accurate. But we're kind of we're kind of delayed on doing anything else until the human body comes. 00:12:05,501 S1: In. 00:12:09,667 S1: So the big. 00:12:10,267 S6: Push that we kind of originally asked for funding for was to get that information on the ground, because we have the temptation, the more information you can grab and the more informed decision making. 00:12:20,400 S1: So the 3.5 billion figure was for the total construction that that was already stabilizing the hill. 00:12:32,467 S7: We're hoping to acquire the funds to pay for that. That's the goal, right? 00:12:36,300 S6: So the ones that we have approved by region eight, FEMA is just to complete the study and then move into the application process for another grant. 00:12:44,367 S1: Okay. 00:12:49,667 S4: With that, I might just turn it over to Grant for, um, kind of, uh, the transportation perspective of a CFP. 00:12:59,400 S1: Grant with more. 00:13:00,267 S7: Engineering. We handled the transportation side and then also the correlating utilities at the transportation project. So you'll see a little bit of overlap between place presentation lines. So the capital improvement plan, the purpose of this is to establish that strategy for you guys as maintenance replacement and growth. Um, make it a consistent strategy. And also to get you guys with a financial plan to be proactive rather than reactive in your replacement maintenance, things like that. And then funding strategy, when you have the roadmap laid out in front of you, it's a lot easier to plan for funding, um, to recognize where you need to apply for funding and when a funding source comes available. Know what to apply for as well, and then also get these projects out in front of the public earlier. So then hopefully they see these. They know that you guys have a plan in front of you. And um, they can start planning for these as well. What's included in ours? Um, you guys currently have about 740,000ft of roadway. So within this CIP would be the maintenance of the existing roadway, but also any growth that is going to occur in the area, whether it's extending, connecting, um, projects like that, urbanizing a road, taking it from a rural to a more urban section, you're going to have the maintenance on that existing. And then Ddot funded projects as a separate category in private developments. 00:14:28,467 S7: The process that we took in the CIP for um, transportation side was We met with staff and commissioners. Throughout the process. We held workshops with engineering and planning, public works, and then multiple workshops along the way as well. We looked at the MPO. They have, um, they have the tip. And then the Mdot also has a transportation improvement plan. So we looked at those with the identified projects and those kind of slated them in the years and priorities. Um, work with staff to identify other projects that might be on the list. And then from there, we we made cost estimates for staff and funding scenarios, try to have that consistent funding scenario, whether it's a Street Improvement district utility replacement project or Ddot. Try and have that consistent formula of a funding scenario and then project prioritization. You guys were involved with that along the way, but, uh, you guys and staff were able to score these projects based on criteria. Next slide. The criteria that were used and established by city staff. Urgency and need. Impact and benefits. Cost effectiveness. Community input and strategic alignment. So these were kind of goals for the city. And that's how you guys were able to prioritize these projects. 00:15:45,167 S7: Cost estimates and funding scenarios. These are based on 2025 construction prices for similar projects in the area. Well some of those projects, as you get further out without a super defined scope, those cost estimates give me a little more rounded figures. Also, as you go to 2030, you're going to have a 5% annual inflation on those projects as well. Um, funding is going to be based on funding availability to date. So some of these funding sources, we don't know how long they're going to last, as we learned this year. Things change rapidly. So we have to adjust. But everything was based on today's funding scenario and environment. Um, so that's how they're laid out in there. There's some subject to change. You also see as as time goes, by the way that these projects work out is going to be funding dependent. A lot of cases where a funding source might come available and you look at your CIP and this project now moves up the list because the funding available for it. So that's going to happen quite a bit to you because. 00:16:47,667 S7: It's kind of hard to see on here. But there's two colors. The green would be the fiscally constrained. Like Jared talked about. Those are those non-negotiables. And the red would be the not non fiscally constrained. These are broken out by year. They're included in the hardcopy here tonight too. Um this is 2026. You can see the green non-negotiables up top. And as we page through here in 2027 00:17:14,267 S7: 3829 00:17:17,667 S7: and 30. So again I can answer any questions on any of these projects. But the deliverable was this hard copy here. And then an Excel similar to like laid out for finance to see the expenditures for a year and then where that money's coming from as well. And then that hard copy is it'll click back to the CliffsNotes version of what's included in our big book. You don't want to read Big Book. Any questions for me? And then there's the funding scenario as well. So you can see local funding to, um, the outside funding as well to breakdown. And if people are interested in where the money is coming from for the CIP, there's tables to show that. 00:18:05,267 S1: And talk about fiscally constrained constraint. 00:18:13,367 S7: Like Jared said, fiscally constrained is what people or what staff identified as the non-negotiable projects. Those are the ones where funding was identified for now. And it's it's identified in a not. Not fiscally constrained be more of a wish list. I guess you could call it of if funding were to become available. And these are other projects that are on the list that we would like to complete. That director. 00:18:39,467 S4: I would say that they are they are the fiscally constrained projects are represented in the utility rate strategy that is about to be presented. Um, and then the projects that, um, were not able to be funded through the a utility rate adjustment were funded through municipal infrastructure funds that are available to us at that time. So we had a finite amount of funding available to spread two projects. And, um, we focused on the absolutely non-negotiables and then the high priority discretionary projects, we reallocated municipal infrastructure. So that is what's represented in basically Finance's presentation. These are the projects that that are being. 00:19:33,601 S4: Considered in that big study. 00:19:36,367 S2: As you. 00:19:36,968 S1: Said. 00:19:37,267 S4: Must be. Yes. 00:19:38,267 S7: Yeah. 00:19:40,567 S1: How often are called for the um I know minimum once a year. But how often are the project costs and the funding? Um. 00:19:54,501 S4: As far. 00:19:54,968 S1: As the. 00:19:55,300 S7: Five year, ten. 00:19:56,100 S1: Year plan, um, how often are those numbers going to be updated? Um, as is it kind of project by project, as more information is gathered or determine. 00:20:09,567 S7: Who. 00:20:09,901 S1: Goes in and refreshes all the information throughout a 12 month period. 00:20:16,400 S4: I think that'll be something that we're kind of learning as we go. I mean, this is our first kind of go after five year CIP and how that exists dynamically. I think we'll have to see. I have access to objects and I have access to more capital improvement software. So I think I would be able to go into both of those programs and update costs as we go. But, um, it might be it might be best practice to put that on a schedule. So you have to go through and and take a look at everything. Once again, just refresh but haven't done that yet. 00:20:57,901 S1: Very good, very good. 00:20:59,167 S5: In the possibility. 00:21:00,701 S1: That what we did here this year, we went through a lot. This was this was a. 00:21:06,467 S2: Pretty. 00:21:06,801 S1: Broad thing. But once every determined. 00:21:09,701 S5: Maybe every two. 00:21:10,767 S8: Years, every three years, you did have a repeat of this year. And within that process you pretty well update things reasonably, unless there's a big drastic change in monetary practices or inflation or something like that. Yeah. 00:21:26,968 S4: Absolutely. Yeah. And I think that even even the course of these last six months that we've been working on this has been pretty poor. Um, it's pretty obvious that it's a living document and we're going to be needing to make updates. I know there's there's certain projects where where, you know, halfway through the project and we're halfway through the process, we identified this project should be split into a high priority project and a low priority project. And just, um, flex fund. Flex funding became available recently, and our application period ends in September. And we know that that was not completed in our CIP. So it's it's going to be something that we need to keep, um, keep updating it. And yeah, every two years, every three years. I think that's good for a big a big overhaul. But I think it's something that I think. 00:22:14,167 S1: That. 00:22:15,267 S4: Probably on a regular. 00:22:16,367 S1: Basis. 00:22:17,100 S8: Because we have the format laid out. This yes. 00:22:20,100 S4: Feels. 00:22:20,467 S8: It feels in preparation for it. And the involvement would not be as intense. 00:22:24,501 S4: Yeah, it feels nice to have kind of an infrastructure infrastructure put in place where if if we get a new project, we know what we have to do to, um, slot that project in and. 00:22:37,067 S1: Uh. 00:22:38,767 S4: Start our evaluation on where, where it fits. 00:22:46,968 S4: Um, tonight, are we making motions to, you know, okay, so we do have both sips available in our, um, in PDF format. The plan is after tonight to make it available on the website for everybody to, uh, view and comment on, possibly. And, um, we're going to be using these documents probably as a basis for future commission items and future commission actions. So, um, it's going to be, um, pretty critical to our. 00:23:25,501 S1: Uh, I. 00:23:26,167 S4: Think, procedure as far as project presentation goes in the future. 00:23:32,501 S1: Just a little bit from our other city students. 00:23:37,467 S1: But what we've been through since April, since. So this is common practice. 00:23:46,701 S7: There's even some funding agencies that are requiring you have some planning documents. 00:23:51,767 S1: Or to submit for grants. 00:23:57,467 S1: I just came from a meeting with our airport. 00:24:00,467 S5: Manager and. 00:24:01,667 S1: Engineer. 00:24:03,300 S5: With. 00:24:03,868 S1: Aeronautics Commission. 00:24:05,267 S5: And. 00:24:05,667 S1: They update their zoning. 00:24:10,868 S1: So my 30 some years here, um, I'm sure the engineering department, um, utilities and all that have their plans, but it's never been brought together in a cumulative process with as much input and participation and transparency as what we're looking at this evening. So it's well overdue. 00:24:37,901 S8: We all get together budget time. We do so every year. And actually Adventure Time, they're competing in nuances that somebody aware of could be at that time too. 00:24:48,868 S1: Right. But to have a comprehensive planning process where you're looking five and we're going to be progressing ten years down the road and how our long term financial plan is going to, um, synchronize with that. Um, and so that's a new process. So this is the first year of implementation of that. 00:25:16,767 S1: Were we for a moment? I thought that was kind of like a warning, either. 00:25:23,667 S6: Did I. 00:25:24,467 S1: Misunderstand? 00:25:27,467 S1: I don't know that we can do motions in a special meeting session. Yeah. I think we'll we'll take consensus as we think we are hearing the. 00:25:41,067 S7: Consensus on. 00:25:41,801 S1: The board or to. 00:25:44,667 S7: We. 00:25:44,868 S1: Start to rearrange 00:25:48,100 S1: objects. 00:25:48,667 S7: And. 00:25:48,901 S1: Orders, and we come to the. 00:25:50,200 S7: Committee and say, okay, we have. 00:25:53,767 S1: To make an adjustment. 00:25:59,567 S7: Yeah. 00:25:59,868 S1: We can't. The board can't make a motion at a special meeting. That is. That would be plan b. 00:26:07,367 S7: O. 00:26:08,567 S1: Chat with the coaster and see if. Something back to do it. Short. 00:26:16,000 S1: Short version of. 00:26:17,267 S7: The motion to adopt. 00:26:18,267 S1: The idea. 00:26:21,767 S4: So I think. 00:26:22,667 S1: That the next step was to put the plans on the city's website so that the general public could see them. 00:26:35,801 S1: Well, congratulations. 00:26:41,067 S1: Uh, Jared. Riley. Justin, all the department heads. This is this is exactly the direction the city needs to go. Uh, thank you to all the engineering firms. Well. 00:26:59,467 S1: I'm proud of this work. Your guys's work. So. Thank you. Yes. Can anybody see? 00:27:08,667 S8: Yeah, I think I've said everything. That's relevance anyway, so I'll leave it at that. 00:27:14,868 S1: I think it's just good. And no matter who's sitting in these chairs, it just hands off and it continues on in a positive way. And that's what we want. We don't want it to be disjointed year to year. Uh, commission to commission. Because I don't see why any of these projects, uh. 00:27:41,567 S1: So should be subject to whims. That makes any sense. But we shouldn't do this now. We ranked them. All of you ranked them in this room. And that's the way we'll go forward. And it's a rolling five years, right? So it's just going to continue on. Um. It's good. So thank you. 00:28:05,868 S8: I can ask asteroid kind of went by the seat of our pants and listening to. But nothing has as a central as this here. Now, of course, I've got a lot of moments ago, but I guarantee that whoever would take my place, I'm going to keep this information for them. Anything else I have and try to clue them in as much as possible. Also, another commissioner coming in, that's not that. Well, Clinton would have at least a pretty good idea of where this goes and how biblical this thing is in terms of where we're going. 00:28:41,100 S1: Exactly. Okay. Are we on to our next item? Next item. Item number 200. New business presentation of the utility rate analysis by Advanced Engineering and Environmental Services A-B from A to Z axis, will be presenting the results of the utility rate study that they've been working on for the past several months, I had to find a way to pay for all this underground infrastructure. 00:29:09,868 S7: Abby. 00:29:10,467 S2: Okay, perfect. Like I mentioned, my name is Abby. I work with a U.S. Nexus. Um, goal of today's presentation give you a brief overview on the overall rate study that we completed, what was done, and then focusing our conversation on, um, the projected rate increases that are really driven by the CIP that you just discussed. So starting off great study, um, Nexus was hired to complete our study evaluating each utility independently. Water, wastewater, stormwater, um, all of that is to look at revenues, expenses independently, as well as those user classes to really understand what costs are driving, um, uh, each utility. Right. So there's three components to our rate study. First piece is a cost of service analysis, and that's really a snapshot in time. Where is the city sitting right now? What costs are or who is driving costs with the which with each utility? Who's driving those costs and then comparing them to the revenues that the city is collecting. And do they, you know, do they match up or do rates need to be adjusted to make sure that each user class is paying their fair share for the utilities? So that's our first piece is where is the city? Where are the city's rates at today? Next piece is revenue adequacy analysis. So that is projecting revenues, expenses, um, you know, operation and maintenance, uh, existing debt. And then of course, the capital cost that we've just discussed over a ten year period, and then again, comparing them to see, um, where the city's shortfalls might lie. Now, um, that includes growth projections as the city is growing. New households, new demand on the system. We incorporated all of those projections into our analysis. Um, but, you know, at the end of the day, we don't expect that current rates are going to be able to cover revenue or expenses in ten years time. Right. So that really leads us into our third piece, which is what do rates need to. Where where do rates need to go in order to cover future expenses that that each utility will have? Um, there's there's many different ways you can increase your rates. You know, it could be a one time bump. It could be gradual increases year over year. Um, so our our first step there was working with the city staff and identifying what are the city's goals with our rate projections. And those scenarios are, like I said, what we're going to focus on today. So talking with staff. Um, first piece is, you know, revenue sufficiency. We need to make sure that the city can pay its bills. Um, and all of those bills that we talked about, right. Whether it's operation and maintenance, keeping the lights on, existing debt the city already has taken on, and then future debt that will come on with, um, the new capital projects. Right. So, um, next is meeting debt service coverage ratios. Now, um, any lender that, uh, in a city has debt with has typically debt coverage that we need to meet. The city also has its own policy when it comes to debt coverage. And so all of those policies were incorporated into our projections on what rate increases are needed. Um, again, most of our lenders, whether it's state private, they're well, um, they may have debt service reserves. So money that's set aside in case of, um, an unexpected shortfall. Um, and then lastly, starting to make make incremental corrections to the city's rate structures to address some of the inequities that we found with existing rates. As I said today. So leaning into going into, um, what are the results of the rate scenario that we, we put together with the city staff? So, um, this is incorporating that must do capital improvement plan. Um, we have this broken out by sewer water and stormwater. Now, what you'll note here is looking from 2025 to 2035, water is not changing. We found that water revenues are adequate to cover, um, future projects that we currently have identified on the capital improvement plan. Stormwater city currently charges $2 per month per utility bill. We're going to see a small increase to 350 per utility bill. The real driver for the anticipated increases in um city's utility bills is is the sewer fund. Right? Um, we're seeing an increase of 27, almost $28. Um, in 2035 to $106. So if you want to go to the next slide, Jared, ultimately that equates to, you know, if we're looking at the three utilities combined, a starting point of, uh, $76.10 for current utility bill. Um, increasing to $155.67 00:34:21,968 S2: by the end of the ten year period. Now, I know this is this is not a happy slide for this. You know, that's a that's a big increase. That's a big act to put on your residents so that with these results, the conversation with city staff shifted to how can we reduce impacts to our residents? How what other revenue sources can we look to to help reduce the impacts and the increases that will be needed to our utility rates? 00:34:53,000 S2: We identified sales tax as the best revenue source that could be incorporated into funding the Capital Improvement Fund specifically for wastewater. Wastewater is the utility that we see having a lot of capital needs coming up, a lot of expensive capital projects, which I'm sure you're all aware of. Right. So, um, incorporating those sales taxes into the wastewater capital improvement plan, um, to help reduce those billing impacts. And, um, you know, let's actually shift one more slide forward. Thank you. So, um, by using sales taxes to reduce revenue requirements to the sewer fund, we're able to reduce the the rate increase by $52. So we're we're shifting to a $27 increase across a ten year period, which I think is a little bit more palatable for the average resident. 00:35:47,701 S2: So at this stage, I you know, we're hoping to see the city move forward with the public sales tax in June of 2026. The city is currently considering a public education campaign, so this would not be a new sales tax. This would be looking at the three quarters sales tax that is currently in place for the starting complex. As that gets paid off, this vote would be to continue the sales tax and increase it to a 1% tax. 00:36:21,367 S2: Um, and then the final finally, um, our next steps for our project, we will be um, evaluating a different rate structure for the water fund. Right. So currently we we charge the same base rate, the same monthly fixed rate for all users. Um, we're working with staff to evaluate alternative structures again to, to look at corrections for improving accountability among our user classes. 00:36:46,701 S1: Our current methodology for Ah. How much? 00:36:51,167 S8: Not the dollar. 00:36:51,868 S1: Amount, but just the methodologies based on number of units. Uh, like a one unit, two unit, three unit structure. That methodology has been in place since the 1980s. 00:37:05,100 S8: It's a good, bad methodology. 00:37:07,267 S1: It's not good. Um, it's not contemporary. It probably served its purpose in its time. It probably was very pragmatic back in the day. It's not how you would run a utility. Um, today, uh, so we're looking at possibly the size of the meter to be the driver. 00:37:27,968 S4: Of. 00:37:28,100 S1: The base rate for water and wastewater. That's one of the, um, next steps in the study that will be looked. 00:37:35,167 S2: At the next great scenario and start looking. And ultimately that'll be a revenue neutral change. So so the the scenarios the rate increases, it will still collect the same revenues. It will just be a slightly different rate structure. 00:37:51,667 S1: And won't ultimately increase revenues? No, it's going to be revenue neutral, but it's going to charge, um, people properly based on the size of the meter. The argument is that the bigger meter, you have the larger need for capacity. So should they be paying a larger share than what they currently are? Um, if they're like a three units or four units or five units scenario, that methodology came in in the early 80s or late 80s. To say, I want to say it was probably in the early 80s. So we we've been under that format for this long. 00:38:35,868 S1: Yeah. It's an example of a four unit apartment complex. 00:38:40,267 S6: Let's say base. 00:38:41,100 S1: Rate is. 00:38:41,767 S7: 16. 00:38:42,300 S1: Units. 00:38:45,467 S7: That's where it's at. Equitable. 00:38:47,567 S1: Right? 00:38:48,667 S6: It's the infrastructure cost. Really? 00:38:58,667 S1: Some of. 00:38:59,100 S6: That. 00:38:59,367 S1: Methodology. 00:39:00,667 S7: Is. 00:39:02,601 S1: The again. 00:39:03,467 S7: The larger. 00:39:05,300 S1: More water you're using, theoretically the larger meter you have theoretically more infrastructure we have to build to make sure your higher users have water. 00:39:20,868 S1: They're wrong. 00:39:21,467 S6: That's I think. 00:39:22,901 S1: The. 00:39:23,067 S6: Theory. 00:39:23,467 S1: Behind that, that seems to be more equitable than someone who uses 8000 gallons of water a month, versus someone going to use 50,000. 00:39:34,167 S7: Gallons. 00:39:34,567 S1: Of water a month. You have to build your infrastructure to handle 50,000ft. 00:39:42,868 S1: Really, it's a peak. 00:39:43,701 S6: Keep. 00:39:44,100 S1: Emphasizing versus. 00:39:45,901 S6: To. 00:39:46,868 S1: Maintain your system. So if you're looking at that to Justin's example, if you have water 16 00:39:58,501 S1: it's not the same size is on for you. So the base rate of the 16 wouldn't be more than the point. Currently we're charging them the same. Correct. So explain to me how it would be revenue neutral. 00:40:17,601 S1: You would take the total revenue that is needed to meet your operations, your debt or your capital needs. And then you would set your rates accordingly based on the size of the meter to generate the same amount of money. But the rates would be different based on the size of the revenue neutral. 00:40:38,868 S6: So 16 could. 00:40:39,801 S1: Go up and go down. Right Right. Right. 00:40:47,167 S1: We have the reasoning behind that. Businessman. So. 00:40:53,667 S1: You already have established right on the floor. And why wouldn't. Why would you take increase on the 16. 00:41:07,667 S1: And pocketed and and we haven't we haven't had the full discussion. We haven't vetted, um, any of that work that's been done to date on that other methodology. And I think. 00:41:22,367 S7: We. 00:41:22,767 S1: Can get there. 00:41:24,200 S7: Step one was to let's. 00:41:25,467 S6: Let's build a new methodology as a as a revenue. 00:41:30,000 S1: Neutral. 00:41:31,000 S6: And then we can analyze are these the right rates for those sizes. 00:41:36,767 S2: And that's kind. 00:41:37,267 S6: Of the adjustments. 00:41:38,367 S7: Made. But we don't. 00:41:39,968 S6: We. 00:41:40,467 S1: Started. 00:41:41,367 S2: That's kind of that discussion about setting one of the city's goals, right? If we're talking about overall affordability and, you know, we know we have other rate increases coming. You know, it's the is the goal to collect as much, you know, increase the rates to collect the additional revenues, or is it to try and reduce impact while improving. 00:42:08,367 S1: The more work more work is going to continue in this area. And that's why when it comes budget presentation on Tuesday, the city is not going to be ready to be rolling out. This is what your utility bill is going to look like for 2026, because we're not. 00:42:24,767 S7: Done. 00:42:25,467 S1: With this process yet. 00:42:29,601 S1: But this is an update on what the rates would look like under our current building methodology. 00:42:46,767 S8: It hasn't been too much discussion. This whole thing on privatization services. Um, but like, for example, the trash collection, sometimes you may have a public company and do that, uh, or the city may do that, you know, which is economically more feasible. There's not much going on right now with privatization. Is there a lot of things to hear more about it? 00:43:10,868 S2: No, not to my knowledge. 00:43:13,167 S8: And. 00:43:16,601 S8: Probably wouldn't have any impact even if you had a private company to do so. So putting on. 00:43:21,267 S2: Putting on my funding hats a little bit. You I, I think you do yourself. You put yourself at a disadvantage, but at least from a water and wastewater utility standpoint, because many of our most advantageous. Funding programs are only available to public agencies, so you would lose out on grant funding and below market interest loans. By doing this. 00:43:46,200 S8: You should hear a lot about it. The article you don't just don't hear that, and you must not have been a good idea in the areas. 00:43:55,267 S1: Gives me pause. And Justin. It's good to make an announcement. 00:44:04,000 S1: Legion baseball. 00:44:07,367 S6: Just beat Fargo. Post two. Major upset. State baseball for. 00:44:14,801 S1: 42 nights. I got goosebumps. 00:44:21,400 S6: Argos. First loss. 00:44:23,567 S1: Conference loss. The first loss in the state. The first loss in state. Yeah. 00:44:34,167 S1: Let's carry on with the question on this. Uh, this you mentioned using. I'm assuming that's the story started using revenue from that sales tax to offset this. Yes it is. And the bonds are projected to be paid off. Um, I think in probably the second quarter of 2027, I think it's. 00:44:59,767 S7: A. 00:44:59,801 S1: Full three quarter plus another quarter. Correct. Okay. So let's be A11 we would ask. We'd have to increase since that increase. Yep. 00:45:19,501 S1: Yep $52 reduction. That's that's real money. 00:45:27,767 S1: And our thoughts. 00:45:31,200 S1: Don't add fire station city hall on that tomb two instead of just one. Thirsty? 00:45:41,767 S1: Where are you sitting right now? 00:45:45,901 S1: He's got tripped a little. Let me give you a beating up there. 00:45:53,968 S1: Any other questions? 00:46:02,567 S1: Summary. The rate analysis has a little bit of work to do. We know that when the city of Bismarck rolled out, um, changes to their rate structure. Meaning that. 00:46:21,300 S1: There are different tiers. I believe that Greg can probably explain it better, but there are different tiers. The more water you use, you might go up into a higher tier, meaning you pay a higher rate. Caused quite the curve, for lack of a better term. Much more descriptions of that that went on in public meetings, and I think they had. I can't remember the number of how many public meetings they had. Commission voted to adopt and the public outcry happened. But I think the worst case that I heard was there was a smaller lot in downtown Bismarck that was using more water than the state capital was using in watering their yard. 00:47:04,901 S1: That's true or not, but I think that's one of the ones that came out. They did all kinds of publications about what the proper amount of water is for your lawn. Wind to water and all this other stuff. But there was there was some heartburn. Um, I believe that the conferences I went to a couple years ago, there was a court case Is that, in a nutshell, would say that how we are charging and how we are feeling, but how we're charging our rate structure is discriminatory towards the lower income folks because it's a flat charge, and usually your lower income folks are using less water. They're helping subsidize higher user waters, which are higher income folks. So there might be some legal reasons we need to make some adjustments. We haven't had that in Dakota, nor do I know how that would ever turn out. But there is that. What? Two. 00:48:12,501 S1: Would the three know? 00:48:17,767 S1: How would we fund the wastewater treatment? 00:48:25,000 S1: We would, we would we would fund it through. Um, we would fund rates, obviously, but it would be the 2% money from the state. 00:48:37,167 S1: Over three years. Again. 30. 30. Thank you. Remember? That's all we needed to hear. Right. That's correct. It is. Yeah. Yeah. I can't remember that would could be a potential use of money construction. Yeah. That's good. Yeah. That would be another one. We haven't kept that one aside for street projects rather than into the plans. Obviously, the goal in planning long term is that your increases each year are at a level that not leveled out. Incremental. So you don't have any big spikes because you didn't look long term for your planning. So you're not looking at one project. You're not looking at two. You're looking at a multitude of projects and you're trying to make that that increase as, uh, as incremental as possible. So it's not so impactful in any one year. But obviously the the big project here is the wastewater treatment plant. It's the wastewater side of of of all three utilities that is needing the biggest rate increase over time. Is that correct? Yes. Yeah. 00:50:02,767 S5: I think it's important, number two, that we work with actions over the current station. And. 00:50:12,300 S5: This is nothing. 00:50:13,167 S1: Compared. 00:50:13,968 S5: To relocating that facility or tying it with this market Bismarck does not want because they might be moving theirs. 00:50:32,067 S1: Okay. 00:50:34,267 S5: Any other questions? 00:50:35,701 S1: Yeah. Jim. Just procedurally, since we're we want to make a June 26th sales tax. For what next steps to what action would we need from forward to do that along with the bank? Uh, we've asked for a proposal for me to ask, like a plan to engage a firm to help us with that. Um, there's the public education piece and all of that stuff where you probably need to time it correctly so that if you do it now and we're going to forget by June, you could do it April and May, at least some people's mind. This is why we're doing it. Most of the. 00:51:23,667 S1: Successful votes for sales tax have been kind of hit people in the last couple of months, few months prior to. So. 00:51:37,100 S5: I agree with. 00:51:37,767 S8: That. 00:51:37,901 S5: But I also think there's eyes on this one too, with yeah, we want to be second first of our proposal. You know, we've done this plan ahead of it. You know, take more a longer time of two years here right in front of it. 00:51:57,400 S1: I think we're looking at, um, we're going for June of 2026 and vote is one that would be most likely to occur. Um, the time for us to start planting seeds or now and then you get the harder public information later on, closer to the vote. But she needs to find it now. So if there's other folks that are considering asking for a sales tax for this or that, or think that we're. 00:52:29,601 S4: Playing our cards on a later. 00:52:36,000 S8: Time. Just march on. It runs. 00:52:43,667 S1: The discussion about City Hall. 00:52:48,267 S1: Is that tonight I'm not speaking to you brought it up. It's not on the agenda right now. So 00:52:56,667 S1: I guess that's a timing. You. 00:53:09,868 S1: Could. 00:53:13,467 S1: Take someone else to that going out there first. 00:53:20,000 S1: So Jared. 00:53:21,000 S5: Does. 00:53:21,200 S1: This. 00:53:21,367 S5: Account for the password. 00:53:22,267 S1: Live station since we're in limbo on that grant. 00:53:26,200 S4: The immediate $2 million. 00:53:29,868 S1: For that part is in there. 00:53:31,868 S4: We have that. That was one of the municipal infrastructure relocations. 00:53:38,801 S4: So not considering the rate study but considering the distance here. 00:53:43,300 S1: Yeah. 00:53:46,367 S1: That would be correlated with this also. No. Okay. 00:53:53,701 S1: I think as we move forward when we're bringing projects in front of the commission to consider, this is a good document that needs to be referred to in the agenda presentation says we want to do street improvement project number to 75, in accordance with what we have laid out as the capital, so that we are going to plan as we move Forward is always beneficial and helpful to commissioners. And John, too public to hear a bit. We've gone through the exercise and. 00:54:34,968 S5: Know the business. 00:54:37,767 S9: Future meeting with the Florida City Commissioners. Tuesday, August 5th, 2025 at 530. Tuesday, August 19th, 2025 at 530 and Tuesday, September 2nd, 2025 at 5 p.m.. And I want to thank everybody. The school board did a tremendous job. Very grateful. 00:55:07,367 S9: And I'll shake your hand. 00:55:09,601 S1: Walked out the door. 00:55:14,667 S8: And.