6/17/2024 - City Council - Work Session - Agendas
CITY OF SPRING PARK
WORK SESSION AGENDA
JUNE 17, 2024 – 5:30 PM
SPRING PARK CITY HALL
(Work Session discussion times are approximate)
1. 5:30: Fire District – Chief Pederson
2. 5:45: Utility Billing: Code Language, Current & Proposed
a. Chapter 34: Utilities (current code language)
b. Utility Invoice: Penalties (back page)
c. League of MN Cities: Model Ordinance/Code Language for Utility Rates and Charges (example to
update code language and procedure)
d. League of MN Cities: Handbook, Securing Water/Sewer Rates (informational)
3. 6:00: Utility Billing Rate Discussion
4. 6:20 Miscellaneous
5. 6:30: Adjourn
CITY CODE
CHAPTER 34: UTILITIES
• DIVISION 2. - RATES AND CHARGES
• Sec. 34-191. - Determination.
Rates, fees and meter deposits shall be determined by the city council and specified in
the utilities department rate schedule.
(Ord. No. 32, ch. III, § 3:00, 6-1-1964)
• Sec. 34-192. - Charges and methods of payment.
Charges for water service shall be based upon the metered quantity of water which a
property owner or occupant draws from the municipal system. The utilities
superintendent shall determine the usage (quarterly) of water for each individual
connection in accordance with the utilities department rate schedule, adopted by
resolution of the city council. Uniform billing procedures shall be established by the
administrator/clerk/treasurer.
(Ord. No. 32, ch. III, § 4:00, 6-1-1964)
• Sec. 34-193. - Delinquent accounts.
The individual accounts shall become due immediately following billing. A penalty, as
prescribed in the utilities rate schedule, shall be added to the next quarterly billing for
any account unpaid one month after the date of billing. An additional penalty shall be
added for each subsequent month in which such account is unpaid. All charges which
are delinquent one year or more on September 30 of each year and which have been
properly billed to the premises may be certified by the administrator/clerk/treasur er
to the county auditor between October 1 and 10 of each year. In certifying such
charges, the amount, the legal description of the premises served, and the name and
owner shall be specified. The amounts so certified, together with the service charges
and interest at the rate of six percent per annum, shall be extended by the county
auditor on the tax rolls against such premises in the same manner as taxes and shall
be paid to the city along with the taxes.
(Ord. No. 32, ch. III, § 4:01, 6-1-1964)
• ARTICLE IV. - EQUALIZATION CONNECTION FEE
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SECTION
• Sec. 34-291. - Purpose.
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(a)
The city municipal sewer system includes lift stations, force mains, trunk lines, laterals
and interceptors. The city municipal water system consists of a treatment plant, water
tower, deep wells, pumps, hydrants, large and small dispersal lines, and an ir on
removal treatment plant. These systems have been and are designed, installed,
maintained and replaced, when required, to serve the present and future use of all
land within the city.
(b)
It is the policy of the city that all users receiving the benefits of the municipal water
and sewer systems bear the increasing costs of design, installation, maintenance and
replacement of those systems. To accomplish this end, an equalization connection fee
is established to be paid for the connection of each self -contained living unit to the
municipal water and/or sewer system when such a self -contained living unit is newly
created by means of original construction, expansion of existing premises, common
interest community conversion or otherwise. This subsection shall not apply to any
such units which have previously been specially assessed for the costs of construction
and/or expansion of the sewer and water systems described in subsection (a) of this
section.
(Ord. No. 32:09, § II, 6 -21-1982)
• Sec. 34-292. - Equalization fee based on units.
(a) The city council shall determine the costs attributable to increase the reserve
capacity necessary for expansion and maintenance of the municipal water and sewer
systems, which shall be based on engineering estimates obtained by dividing the cost
of sewer and water improvements benefiting future development by the projected
number of future equivalent units. Equalization fees shall be adjusted in accordance
with the Engineering News Record Construction Cost Index, or similar publication, in
order to enable the charges to remain abreast of inflationary trends. Such fees shall
be determined by the city council from time to time in accordance with the criteria set
forth in this subsection.
(b) Definition and computation of units shall be as follows:
(1) Single-family houses, townhouses and duplex units shall comprise one unit
for each living unit.
(2) Common interest communities and apartments shall each comprise one
unit for each living unit.
(3) Other buildings and structures shall be assigned one unit for each 100,000
gallons of flow per year which it is estimated they will discharge, and
commercial and industrial building units shall be assigned a minimum of one
unit.
(4) Basis for determination of units for commercial, industrial and institutional
connection shall be the same as determined by metropolitan waste control
commission's SAC charge schedule.
(Ord. No. 32:09, § III, 6-21-1982)
• Sec. 34-293. - Payment of equalization/availability fees.
The equalization connection fee shall be due and payable in full upon application for a
building permit for original construction or expansion of existing premises when such
construction or expansion is intended to create one or more new self -contained living
units, or, in the alternative, upon application for a common interest community
conversion license.
(Ord. No. 32:09, § IV, 6-21-1982)
League of Minnesota Cities Model Ordinance: 4/24/2024
Establishing City Water and Sewer Accounts Page 1
Establishing City Water and Sewer Accounts, LMC Model Ordinance
League models are thoughtfully developed by our staff for a city’s consideration. Models should be
customized as appropriate for an individual city’s circumstances in consultation with the city’s attorney.
Helpful background information on this model may be found in “Securing Payment of Utility Charges”.
This icon marks places where the city must customize the model. They offer
additional provisions, optional language, or comments for your consideration. The
icon, and language you do not wish to include, should be deleted from this model
before use. Make other changes, as needed, to customize the model for your city.
ORDINANCE NO. XX
AN ORDINANCE ESTABLISHING CITY WATER AND SEWER ACCOUNTS, RATES
AND PROVIDING FOR COLLECTION OF DELINQUENT CHARGES
The City Council of Spring Park, Minnesota ordains:
SECTION 1. DEFINITIONS
For the purposes of this Ordinance, the following capitalized terms listed in alphabetical order
shall have the following meanings:
1.1 Account. A record of utility services used by each property and the periodic costs for
those utility services.
1.2 City. The City of Spring Park County of Hennepin, State of Minnesota.
1.3 City Utility System. Facilities used for providing public utility service owned or
operated by City or agency thereof, including sewer, storm sewer and water service.
1.4 Utility Rate Schedule. A schedule of all utility rates and charges set by ordinance of the
City.
1.5 Waterworks System. Water and sewer transmission pipes, lines, fixtures, meters and all
necessary equipment and appurtenances owned or operated by the City utility system for the
purpose of providing water and sewer services for public or private use.
SECTION 2. ACCOUNTS.
All accounts shall be carried in the name of the owner who personally, or by his or her
authorized agent, applied for such service. The owner shall be liable for water and sewer services
supplied to the property, whether he or she is occupying the property or not, and any unpaid
charges shall be a lien upon the property.
SECTION 3. BILLING.
Water, sewer, charges shall be billed on one bill as applicable to each account. All charges for
water, sewer, shall be due upon receipt and considered delinquent after the tenth day of the
following month. All bills shall contain the title, address and telephone number of the official in
League of Minnesota Cities Model Ordinance: 4/24/2024
Establishing City Water and Sewer Accounts Page 2
charge of billing; the title, address and phone number shall be clearly visible and easily readable.
Bills shall be mailed to the customers on or before the fifth day of January, April, July, and
October of each year and specify the water consumed and the sewer charges in accordance with
the current fee schedule set by ordinance of the City council.
You may insert “and” followed by any other utility service charges you may wish to name
in all the blanks provided in Section 3. If the city has none, delete this field. Note: Consult
the city attorney before adding unpaid electrical charges to this ordinance.
SECTION 4. UTILITY RATE SCHEDULE.
4.1 The utility rate schedule shall be adopted annually by ordinance of the City Council.
4.2 The City Council ordinance setting out the utility rate schedule shall also establish the
number of certification cycles per year. At least one certification cycle will be timed each year to
coincide with Hennepin County’s requirements for certification to the following year’s taxes.
Additional certification cycles may be set in the annual rate schedule ordinance. Each year, the
council shall establish one or more certification cut-off dates. All city utility accounts, unless
exempt for other legal reason, which have been billed a delinquent bill and remain unpaid as of
the certification cut-off date shall have the balance on the account including in a preliminary
certification list.
SECTION 5. DELINQUENT ACCOUNTS.
5.1 Penalties. A late payment penalty of _______ percent shall be assessed on all accounts
with a past due balance.
5.2 Shut-off for nonpayment. Water shall not be shut-off until notice and an opportunity for
a hearing before the city council or an employee designated by the city council have provided to
the occupant and owner of the premises involved.
5.2.1 If any bill is not paid by the due date listed on the bill, a second bill will be mailed
by first class mail and shall state that if payment is not made within ten days of the
mailing of the second bill, water service to the premises will be shut off for nonpayment.
5.2.2 The second bill and shut-off notice contain the title, address and telephone number
of the official in charge of billing; the title, address and phone number shall be clearly
visible and easily readable.
5.2.3 The notice shall also state that any occupant or owner has the right to a hearing
before the water service is shut off. The owner or occupant may be represented in person
and by counsel or any other person of his or her choosing. The owner or occupant may
present orally or in writing his or her complaint to the city official in charge of utility
billing. This official shall be authorized to order continuation of the customer’s service
and shall have the authority to adjust the customer’s bill or enter into a mutually
agreeable payment plan.
League of Minnesota Cities Model Ordinance: 4/24/2024
Establishing City Water and Sewer Accounts Page 3
5.2.4 If an occupant or owner requests a hearing, the water shall not be shut off until the
hearing process is complete.
5.2.5 If a customer fails to pay and fails to request a hearing under this part, service will
be shut off at the time specified in the notice but not until the charges have been due and
unpaid for at least 30 days.
5.3 Certification for collection with taxes. Unpaid charges on sewer and water accounts
shall not be certified to the county auditor until notice and an opportunity for a hearing have been
provided to the owner of the premises involved. The notice shall be sent by first class mail and
shall state that if payment is not made before the date for certification, the entire amount unpaid
plus penalties will be certified to the county auditor for collection as other taxes are collected.
The notice shall also state that the occupant may, before such certification date, attend or
schedule a hearing on the matter to object to certification of unpaid utility charges.
In addition to any penalties provided for in this ordinance if any person, firm or corporation fails
to comply with any provision or this ordinance, the Council or any city official designated by it,
may institute appropriate proceedings at law or at equity to procure payment.
5.4 Optional payment before certification. The owner of the property shall have the option
of paying the balance due on the account until the date the notice of the certification hearing is
mailed. After the date the notice of certification hearing is mailed, payments will still be
accepted but will include unpaid penalties.
5.5 Hearing required. A hearing shall be held on the matter by the City Council. Property
owners with unpaid utility charges shall have the opportunity to object to the certification of
unpaid charges to be collected as taxes are collected. If, after the hearing, the City Council finds
that the amounts claimed as delinquent are actually due and unpaid and that there is no legal
reason why the unpaid charges should not be certified for collection with taxes in accordance
with this ordinance, the City may certify the unpaid charges to the county auditor for collection
as other taxes are collected.
5.6 Hearing options. For each certification sustained, the property owner shall have the
following options after the hearing,
5.6.1 To pay the delinquent amount listed on the preliminary roll, but without additional
interest after the hearing, within ten day of the hearing date.
5.6.2 To pay the certified delinquent amount after the hearing date, but before the county
certification deadline, with interest at the rate set in the adopted rate schedule, accrued
beginning on eleventh day following the hearing date through the date of payment.
5.6.3 To pay the certified charges as billed to them by Hennepin County on their property
tax statement with a collection term of one year.
League of Minnesota Cities Model Ordinance: 4/24/2024
Establishing City Water and Sewer Accounts Page 4
5.7 Delivery to County. Fifteen days after the hearing, the certified roll, minus any
payments, shall be delivered to Hennepin County.
SECTION 6. OTHER REMEDIES
In addition to any procedures or penalties provided for this ordinance if any person, firm or
corporation fails to comply with any provision of this ordinance, the council or any city official
designated by it may institute appropriate proceedings at law or at equity to procure payment and
or enforce the provisions of this ordinance.
Passed by the City Council of Spring Park, Minnesota this _____ day of Month, Year.
___________________
Mayor
Attested:
____________________
City Clerk
LEAGUE OF MN CITIES - HANDBOOK FOR MN CITIES CHAPTER 11: CITY REGULATORY
FUNCTIONS
SECURING PAYMENT OF UTILITY CHARGES
Informational memo including statutes and relevant links
Full Article can be found here.
Municipal sewer, water, and storm water charges set by ordinance:
To enforce collection of utility charges, include an explanation of charges and methods of
collection in the local ordinance. The fee schedule itself should be adopted by ordinance, rather
than resolution, to give it the weight and enforceability of a local law.
Water Conservation:
Current water conservation law provides fiexibility to municipal water utilities. To conserve
groundwater, municipal water utilities serving more than 1,000 people must include a
“conservation rate structure” or a uniform rate structure combined with other ways to reduce
demand for water before requesting approval from the commissioner of Health to construct a
public water supply well or requesting an increase in the authorized volume of water appropriation.
“Demand reduction measures” are measures that reduce water demand, water losses, peak water
demands, and nonessential water uses.
Conservation rates:
If a conservation rate is applied to multifamily dwellings, the rate structure must consider each
residential unit as an individual user. For multi-unit dwellings, the rate schedule must include
calculating water rates based on counting each residential unit as an individual user. The law does
not specify the type of conservation rate system required but now, city water utilities must not offer
a rate structure that rewards consumption. So, rates must not go down based on increased
consumption of water.
Sanitary sewer charges:
The law deflnes “sanitary sewer” to include sanitary sewer systems, sewage treatment works,
disposal systems, and other facilities for disposing of sewage, industrial waste, or other waste. For
sanitary sewers, cities may assess charges according to the amount of water consumed or by
reference to a reasonable classiflcation of the types of premises receiving the service. Cities may
also combine these formulas to set sanitary sewer charges based on the type of property and the
amount of water used. Sanitary sewer charges must not be based on the size, or square footage, of
the property served.
Water charges:
Cities may charge based on water consumed. In addition, cities may charge fiat rates, or usage
charges based on property classiflcation, availability, and connection charges, for municipal water
or sewer service. A fiat rate is a constant charge independent of water usage that may vary based
on the classiflcation of the property (for example, commercial or residential). The advantage of a
fiat rate is simplicity; the disadvantage is that it does not encourage conservation.
Metered usage charges are based on the amount of water consumed and on classiflcations of
property. Typically, the classiflcations are residential, farm, commercial, industrial, and
institutional. Connection charges may be set by reference to actual cost of connection as well as
by reference to assessments paid by connecting property or by any other method, if connection
charge is “just and equitable.” The governing body of the utility (either the city council or the local
public utilities commission) decides what method to use to determine the connection charges.
Availability or standby charges are additional charges or fees imposed by a municipal water utility
on the owners of structures equipped with flre protection systems such as standpipes, hydrants, or
automatic flre protection sprinkler systems. State law limits availability or standby charges to the
cost of supplying water, and the actual cost of installing, inspecting, and maintaining the system.
The term “availability charge” is also used as a basis for an acceptable charge against landowners
whose property abuts a water or sewer line, even if the owner does not connect to the line. This
charge recognizes the ability to connect to the system as a value to the property