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Resolution No. 275-21 - Resolution - 2022 Rochester Public Utility Electric and Water Utility Budgets
RESOLUTION Adopting the 2022 RPU Electric Utility and Water Utility Capital, Including Multi-year Projects and Operating Budgets. BE IT RESOLVED by the Common Council of the City of Rochester that the Common Council concurs in the Resolutions of the Rochester Public Utility Board appended hereto, requesting approval for the 2022 Electric Utility and Water Utility Capital, including multi-year projects and operating budgets. PASSED AND ADOPTED BY THE COMMON COUNCIL OF THE CITY OF ROCHESTER, MINNESOTA, THIS __________ DAY OF _______________, 2021. ___________________________________ PRESIDENT OF SAID COMMON COUNCIL ATTEST: __________________________ CITY CLERK APPROVED THIS _____ DAY OF ______________________, 2021. ___________________________________ MAYOR OF SAID CITY (Seal of the City of Rochester, Minnesota) Appendix ROCHESTER PUBLIC UTILITIES 2022 ELECTRIC UTILITY OPERATING BUDGET ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY 2022 OPERATING BUDGET INDEX Title Pages Basic Assumptions 1 Forecast by Year 2021 through 2026 2 Condensed Income Statement 3 Revenue Sources & Expense Categories 4 Operating Expenditures Graph 5 Production & Sales Statistics Forecast 6 Section 1 ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY 2022 OPERATING BUDGET BASIC ASSUMPTIONS • Cost center budgets and non-bonded projects set at level used in cost-of-service study • Other than specifically identified projects, no assumptions have been made with regards to DMC • Interest Earnings Rate: 1.80% • Average Salary Expense Change: 3.5% (excluding headcount additions) (consists of COLA, merit and promotion increases) • Anticipated Bonding $18,000,000 in 2023 (AMI) • Change in Full-time Equivalents: 1 incremental, 2 contract conversions • 0.0% increase SMMPA Wholesale Power Cost: • SMMPA CROD Level: 216 MW • Minimum Cash Reserve Requirement: Current policy amount $52,102,400 RETAIL REVENUES / SALES • Revenue Adjustment: 1.5% proposed • Electric KWH Sales Forecast: 1.0 % Increase from 2021 Year End Projected Sales • Total Electric Utility Customers: 1.6% Increase over Year End 2021 Projected Customers 30 Yr Average Heating/Cooling Degree Days per Year • Forecast Assumes Normal Weather : WHOLESALE FUEL COSTS • Estimated Cost of Fuel 2022 $3.61 / mcf • Budgeted Cost of Fuel 2021 F2 $4.77 / mcf OTHER ITEMS • In Lieu of Tax forecast increasing $303,803 to a total of $9,009,578. Section 1 - Page 1 ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY Management Reporting P&L Historical Data in 000's 2019 2020 2021 F2 2022 2023 2024 2025 2026 RPU Rate Increase 1.9% 0.0% 0.0% 1.5% 2.5% 2.5% 2.5% 2.5% 1 Revenue 2 Retail Electric $147,940 $143,975 $151,713 $152,326 $155,871 $160,831 $164,729 $168,723 3 Wholesale Electric $2,503 $1,939 $3,880 $3,310 $3,856 $3,856 $3,856 $3,856 4 Wholesale Steam $3,810 $4,812 $5,951 $4,167 $3,824 $3,824 $3,824 $3,824 5 Transmission $5,580 $11,152 $6,148 $6,000 $6,000 $6,000 $6,000 $6,000 6 Other Services & Fees $5,061 $7,315 $3,543 $8,512 $5,257 $5,305 $5,353 $5,402 7 Total Revenue $164,893 $169,193 $171,236 $174,315 $174,808 $179,816 $183,763 $187,806 8 Cost of Revenue SMMPA Rate Increase (Decrease) (4.0%) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 9 Power Supply $89,722 $85,673 $90,253 $90,673 $91,248 $91,870 $92,379 $92,849 10 Generation Fuel $3,780 $3,784 $6,187 $4,328 $4,179 $4,163 $4,166 $4,170 11 Total Cost of Revenue $93,502 $89,456 $96,440 $95,001 $95,427 $96,033 $96,546 $97,019 12 Gross Margin 13 Retail Electric $58,218 $58,302 $61,460 $61,653 $64,623 $68,960 $72,350 $75,874 14 Wholesale $2,532 $2,967 $3,645 $3,150 $3,502 $3,518 $3,514 $3,511 15 Transmission $5,580 $11,152 $6,148 $6,000 $6,000 $6,000 $6,000 $6,000 16 Other Services & Fees $5,061 $7,315 $3,543 $8,512 $5,257 $5,305 $5,353 $5,402 17 TOTAL GROSS MARGIN $71,391 $79,737 $74,795 $79,314 $79,382 $83,783 $87,217 $90,787 18 Controllable Costs $24,151 $24,042 $24,660 $28,023 $29,495 $30,790 $31,857 $33,314 19 Salaries & Benefits 20 Other Operating Expenses $9,149 $8,859 $10,379 $10,951 $11,042 $11,070 $11,327 $11,532 21 Major Maintenance $2,881 $3,112 $4,606 $7,549 $6,489 $4,414 $4,445 $4,151 22 Non-Bonded Capital Projects $11,902 $12,441 $17,722 $32,477 $22,983 $10,415 $11,226 $17,920 23 TOTAL CONTROLLABLE COSTS $48,083 $48,453 $57,366 $79,000 $70,010 $56,689 $58,854 $66,917 24 Depreciation & Amortization $14,005 $14,959 $15,353 $15,176 $15,367 $15,450 $16,098 $16,336 25 Less Non Bonded Projects (capitalized) ($11,902) ($12,441) ($17,722) ($32,477) ($22,983) ($10,415) ($11,226) ($17,920) 26 Less Total Internal Costs (capitalized) ($4,968) ($3,696) ($6,406) ($5,423) ($6,389) ($6,146) ($5,850) ($6,745) 27 Interutility Allocation ($1,534) ($1,737) ($1,875) ($1,862) ($1,899) ($1,937) ($1,976) ($2,016) 28 Total Operating Expenses $43,685 $45,538 $46,716 $54,414 $54,107 $53,641 $55,900 $56,573 29 Net Operating Income (Loss) $27,706 $34,199 $28,079 $24,900 $25,275 $30,141 $31,317 $34,214 30 Financing & Other Non-Operating Items: 31 Bond & Interest Related Expenses ($6,473) ($6,421) ($5,677) ($5,494) ($5,325) ($6,017) ($5,748) ($5,459) 32 Interest Income $2,685 $2,180 $1,490 $1,965 $1,982 $2,101 $2,221 $2,332 33 Misc Non-Operating Income (Expense) ($201) ($6) ($17) ($24) ($24) ($25) ($25) ($26) 34 Total Financing & Non-Operating Items ($3,989) ($4,248) ($4,204) ($3,552) ($3,367) ($3,941) ($3,552) ($3,152) 35 Income Before Transfers or Capital Contributions $23,717 $29,951 $23,876 $21,347 $21,908 $26,200 $27,765 $31,062 36 Transfers (In Lieu of Taxes) ($8,714) ($8,370) ($8,706) ($9,010) ($9,240) ($9,476) ($9,711) ($9,948) 37 Capital Contributions/Intercompany $736 $2,363 $6,566 $14,204 $11,843 $366 $377 $3,138 38 NET INCOME $15,739 $23,944 $21,735 $26,542 $24,511 $17,091 $18,431 $24,253 39 NET INCOME (Excluding Capital Contributions) $15,170 $12,338 $12,668 $16,725 $18,054 $21,115 40 TARGET NET INCOME $ 15,539 $ 15,415 $ 16,675 $ 18,865 $ 19,723 $ 20,992 41 Excess (Deficit) from Target $ (369) $ (3,077) $ (4,007) $ (2,140) $ (1,669) $ 123 42 1/01 Cash Balance $ 88,728 $ 90,413 $ 98,117 $ 97,275 $ 100,009 $ 106,262 $ 113,428 43 Change in Net Assets 23,944 21,735 26,542 24,511 17,091 18,431 24,253 44 Depreciation & Amortization 14,959 15,353 15,176 15,367 15,450 16,098 16,336 45 Capital Additions/Service Territory Comp (16,138) (24,128) (37,900) (32,356) (22,283) (22,105) (26,315) 46 Bond Principal Payments (6,015) (6,515) (7,085) (7,395) (9,195) (9,536) (9,905) 47 Bond Proceeds - 0 - 18,000 0 0 (0) 48 Net Change in Other Assets/Liabilities (15,065) 1,259 2,425 (15,392) 5,189 4,278 972 49 Net Changes in Cash 1,685 7,704 (842) 2,735 6,252 7,166 5,342 50 12/31 Cash Balance $ 90,413 $ 98,117 $ 97,275 $ 100,009 $ 106,262 $ 113,428 $ 118,771 51 Mimimum Cash Reserve $ 57,408 $ 52,569 $ 52,102 $ 52,834 $ 53,074 $ 53,479 $ 53,175 52 Excess (Deficit) from Miminum Cash Reserve $ 33,005 $ 45,548 $ 45,172 $ 47,175 $ 53,188 $ 59,949 $ 65,596 53 Debt Service Coverage Ratio 3.6 3.4 3.1 2.7 3.0 3.1 3.3 Section 1 - Page 2 ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY Management Reporting P&L Historical Data 2021 2022 Variance % 2022 to Orig in 000's 2019 2020 Orig Bdgt 2021 F2 2022 Orig Bdgt Bdgt Variance 1 Revenue 2 Retail Electric $147,940 $143,975 $144,960 $151,713 $152,326 $149,421 $2,905 1.9% 3 Wholesale Electric $2,503 $1,939 $2,753 $3,880 $3,310 $2,932 $378 12.9% 4 Wholesale Steam $3,810 $4,812 $5,422 $5,951 $4,167 $6,213 ($2,046) -32.9% 5 Transmission $5,580 $11,152 $6,000 $6,148 $6,000 $6,000 $0 0.0% Other Services & Fees $5,061 $7,315 $3,744 $3,543 $8,512 $3,792 $4,720 124.4% 6 Total Revenue $164,893 $169,193 $162,879 $171,236 $174,315 $168,358 $5,957 3.5% 7 8 Cost of Revenue 9 Power Supply $89,722 $85,673 $88,818 $90,253 $90,673 $88,857 $1,816 2.0% Generation Fuel $3,780 $3,784 $4,828 $6,187 $4,328 $5,079 ($751) -14.8% 10 Total Cost of Revenue $93,502 $89,456 $93,646 $96,440 $95,001 $93,936 $1,065 1.1% 11 12 Gross Margin 13 Retail Electric $58,218 $58,302 $56,142 $61,460 $61,653 $60,563 $1,089 1.8% 14 Wholesale $2,532 $2,967 $3,347 $3,645 $3,150 $4,066 ($916) -22.5% 15 Transmission $5,580 $11,152 $6,000 $6,148 $6,000 $6,000 $0 0.0% Other Services & Fees $5,061 $7,315 $3,744 $3,543 $8,512 $3,792 $4,720 124.4% 16 TOTAL GROSS MARGIN $71,391 $79,737 $69,233 $74,795 $79,314 $74,422 $4,892 6.1% 17 18 Controllable Costs 19 Salaries & Benefits $24,151 $24,042 $24,702 $24,660 $28,023 $27,497 $526 1.9% 20 Other Operating Expenses $9,149 $8,859 $10,270 $10,379 $10,951 $10,513 $438 4.2% 21 Major Maintenance $2,881 $3,112 $3,815 $4,606 $7,549 $7,462 $87 1.2% Non-Bonded Capital Projects $11,902 $12,441 $26,108 $17,722 $32,477 $17,431 $15,046 86.3% 22 TOTAL CONTROLLABLE COSTS $48,083 $48,453 $64,895 $57,366 $79,000 $62,903 $16,097 25.6% 23 24 Depreciation & Amortization $14,005 $14,959 $15,045 $15,353 $15,176 $14,993 $184 1.2% 25 Less Non Bonded Projects (capitalized) ($11,902) ($12,441) ($26,108) ($17,722) ($32,477) ($17,431) ($15,046) 86.3% 26 Less Total Internal Costs (capitalized) ($4,968) ($3,696) ($8,100) ($6,406) ($5,423) ($5,653) $230 -4.1% Interutility Allocation ($1,534) ($1,737) ($1,719) ($1,875) ($1,862) ($1,753) ($109) 6.2% 27 Total Operating Expenses $43,685 $45,538 $44,013 $46,716 $54,414 $53,059 $1,355 2.6% 28 Net Operating Income (Loss) $27,706 $34,199 $25,220 $28,079 $24,900 $21,363 $3,537 16.6% 29 30 Financing & Other Non-Operating Items: 31 Bond & Interest Related Expenses ($6,473) ($6,421) ($6,268) ($5,677) ($5,494) ($6,098) $604 -9.9% 32 Interest Income $2,685 $2,180 $1,746 $1,490 $1,965 $1,700 $265 15.6% Misc Non-Operating Income (Expense) ($201) ($6) ($17) ($17) ($24) ($18) ($6) 33.2% 33 Total Financing & Non-Operating Items ($3,989) ($4,248) ($4,540) ($4,204) ($3,552) ($4,415) $863 -19.5% 34 Income Before Transfers or Capital Contributions $23,717 $29,951 $20,680 $23,876 $21,347 $16,948 $4,399 26.0% 35 36 Transfers (In Lieu of Taxes) ($8,714) ($8,370) ($8,617) ($8,706) ($9,010) ($8,813) ($197) 2.2% 37 Capital Contributions/Intercompany $736 $2,363 $10,861 $6,566 $14,204 $4,423 $9,781 221.1% NET INCOME $15,739 $23,944 $22,924 $21,735 $26,542 $12,558 $13,984 111.4% 38 39 1/01 Cash Balance $ 88,728 $ 85,048 $ 90,413 $ 98,117 $ 83,997 $ 14,120 16.8% 40 Change in Net Assets 23,944 22,924 21,735 26,542 12,558 13,984 111.4% 41 Depreciation & Amortization 14,959 15,045 15,353 15,176 14,993 184 1.2% 42 Capital Additions/Service Territory Comp (16,138) (34,208) (24,128) (37,900) (23,084) (14,816) 64.2% 43 Bond Principal Payments (6,015) (6,315) (6,515) (7,085) (6,625) (460) 6.9% 44 Bond Proceeds - - 0 - 0 (0) 0.0% 45 Net Change in Other Assets/Liabilities (15,065) 1,503 1,259 2,425 (1,866) 4,291 -230.0% 46 Net Changes in Cash 1,685 (1,051) 7,704 (842) (4,024) 3,182 -79.1% 47 12/31 Cash Balance $ 90,413 $ 83,997 $ 98,117 $ 97,275 $ 79,973 $ 17,302 21.6% $ 52,102 $ 55,011 $ (2,909) -5.3% 48 Mimimum Cash Reserve $ 57,408 $ 52,569 $ 52,569 Excess (Deficit) from Miminum Cash Reserve $ 33,005 $ 31,428 $ 45,548 49 $ 45,172 $ 24,962 $ 20,210 81.0% Section 1 - Page 3 Maintenance 2.8% Depreciation $149,415,177 EXPENSE Transmission $79,313,997 MARGIN GROSS ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY 2022 OPERATING BUDGET Section 1 - Page 4 Electric Expenditures Operating Electric 2026 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016 20,000,000 25,000,000 30,000,000 35,000,000 40,000,000 45,000,000 50,000,000 Expenditures Operating Section 1 - Page 5 ROCHESTER PUBLIC UTILITIES PRODUCTION & SALES STATISTICS FORECAST ELECTRIC UTILITY 2021 F2 2022 2023 2024 2025 2026 Peak MW 1 SMMPA 216 216 216 216 216 216 2 Self Generation - - - - - - 3 Market 54 59 61 62 64 66 4 Total Peak MW 270 275 277 278 280 282 5 % Change 1.9% 1.6% 0.7% 0.6% 0.6% 0.6% 6 Retail MWH 1,178,107 1,190,420 1,196,939 1,203,386 1,209,093 1,214,274 7 8 % Change 4.4% 1.0% 0.5% 0.5% 0.5% 0.4% Purchased Power MWH 9 SMMPA 1,192,067 1,203,977 1,210,388 1,216,732 1,222,292 1,227,326 10 Other 3,661 2,426 2,698 2,962 3,251 3,528 11 Total Purchased Power MWH 1,195,728 1,206,404 1,213,085 1,219,694 1,225,543 1,230,853 12 % Change 3.8% 0.9% 0.6% 0.5% 0.5% 0.4% 13 Generation MWH 14 Total Generation MWH 59,180 68,749 68,749 68,749 68,749 68,749 15 16 % Change -10.2% 16.2% 0.0% 0.0% 0.0% 0.0% Number of Customers 17 Residential 53,382 54,292 55,209 56,126 57,043 57,959 18 Small General Service 4,663 4,709 4,756 4,804 4,852 4,902 19 Medium General Service 479 487 495 503 511 520 20 Large General Service 13 13 13 13 13 13 21 Large Industrial Service 1 1 1 1 1 1 22 Street & Hwy Lightings 3 3 3 3 3 3 23 Interdepartmental 1 1 1 1 1 1 24 Total Customers 58,542 59,506 60,478 61,451 62,424 63,399 25 26 % Change 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% Blended cost per MWH for retail supply $ 75.48 $ 73.78 $ 73.73 $ 73.83 $ 73.89 $ 73.95 27 Steam Generation MLBS 487,711 490,221 449,884 449,884 449,884 449,884 28 % Change -2.1% 0.5% -8.2% 0.0% 0.0% 0.0% 29 Section 1 - Page 6 ROCHESTER PUBLIC UTILITIES 2022 ELECTRIC UTILITY CAPITAL IMPROVEMENT AND MAJOR MAINTENANCE BUDGET ROCHESTER PUBLIC UTILITIES ELECTRIC UTILITY 2022 CAPITAL IMPROVEMENT AND MAJOR MAINTENANCE BUDGET INDEX Title Pages 5 Year Project List: Major Maintenance Projects 1 Capital Projects 2 - 3 Section 2 Rochester Public Utilities Electric Utility 2022 - 2026 Major Maintenance Plan A B C D E F G H Multi Year Project Description 2022 2023 2024 2025 2026 Total 4 Total 5 Compliance 6 152 - Compliance 7 WESEmissionsTesting - - 66,900 - - 71,000 137,900 8 152 - Compliance Total - - 66,900 - - 71,000 137,900 9 Compliance Total - - 66,900 - - 71,000 137,900 10 Core Services 11 113 - Construction, Maintenaqnce and Field Operations 12 Tree Trimming - 1,700,000 1,700,000 1,700,000 1,700,000 1,700,000 8,500,000 13 Asbestos Manhole Mitigation - 70,000 85,000 85,000 85,000 85,000 410,000 14 113 - Construction, Maintenaqnce and Field Operations Total - 1,770,000 1,785,000 1,785,000 1,785,000 1,785,000 8,910,000 15 114 - Technical Services 17 Capacitor Bank Controls Replacement - 10,000 - - - - 10,000 19 114 - Technical Services Total - 10,000 - - - - 10,000 20 116 - Engineering 21 Distribution System Planning Study - 60,000 - - - - 60,000 23 DER Hosting Capacity Study - - 100,000 - - - 100,000 24 Downtown Duct & Feeder Routing Study 90,000 30,000 60,000 - - - 90,000 25 DER Software Portal - - - 50,000 - - 50,000 26 Transmission LIDAR and Clearance Analysis - - - 100,000 100,000 - 200,000 27 PLS-CAD Model of K1 - 40,000 - - - - 40,000 28 Pole Attachment & Clearance Violation Survey - - 50,000 - - - 50,000 29 Stray Voltage Survey - - 40,000 - - - 40,000 30 Downtown Electric Reconfiguration Study - 70,000 - - - - 70,000 31 116 - Engineering Total 90,000 200,000 250,000 150,000 100,000 - 700,000 32 119 - Metering 33 AMI-Timing Study - 514,733 - - - - 514,733 34 119 - Metering Total - 514,733 - - - - 514,733 35 113 - Allocation 36 Alloc-Transmission Asset Management - 45,000 45,000 45,000 45,000 45,000 225,000 37 Alloc-Distribution Lines & Equipment - 250,003 257,500 265,250 196,685 202,595 1,172,033 38 113 - Allocation Total - 295,003 302,500 310,250 241,685 247,595 1,397,033 39 114 - Allocation - 169,400 167,000 167,000 167,000 167,000 837,400 40 Core Services Total 90,000 2,959,136 2,504,500 2,412,250 2,293,685 2,199,595 12,369,166 41 Corporate Services 42 138 - Finance & Accounting 43 Electric Cost-of-Srvc/Rate Design Study - - 83,000 - - 83,000 166,000 44 Rates Modeling - 20,000 20,000 20,000 20,000 20,000 100,000 45 Budgeting System - 75,000 50,000 50,000 50,000 50,000 275,000 46 138 - Finance & Accounting Total - 95,000 153,000 70,000 70,000 153,000 541,000 47 144 - Information Technology 48 SCADA Pen Test - 25,000 25,000 25,000 25,000 25,000 125,000 49 Utegration(HPC) Support Contract - 75,000 75,000 75,000 75,000 75,000 375,000 50 SAP Technical Upgrade - - 100,000 - - 100,000 200,000 53 ImageNow Upgrade - 30,000 - 30,000 - 30,000 90,000 54 Symantec Replacement - 60,000 - - - - 60,000 55 144 - Information Technology Total - 190,000 200,000 130,000 100,000 230,000 850,000 56 144 - Allocation Information Technology 57 Alloc-Info Risk & Security/City Shared Infra - 4,500 4,500 4,500 14,500 4,500 32,500 58 Alloc-Business Systems / Applications - 40,000 40,000 40,000 40,000 40,000 200,000 59 144 - Allocation Information Technology Total - 44,500 44,500 44,500 54,500 44,500 232,500 60 Corporate Services Total - 329,500 397,500 244,500 224,500 427,500 1,623,500 61 Customer Relations 62 137 - Marketing 63 Customer Experience Mapping - 160,000 - - - - 160,000 65 DSM - EV TOU Rate - 126,127 90,845 111,168 127,300 164,906 620,346 66 DSM - DLC Smart Thermostat Program - 147,851 142,880 164,606 186,998 210,089 852,424 67 137 - Marketing Total - 433,978 233,725 275,774 314,298 374,995 1,632,770 68 150 - Customer Care 69 Data Lake - 35,640 - - - - 35,640 70 RPU Program Changes - 50,000 106,400 51,000 52,020 53,060 312,480 71 SEW Modifications - 73,900 75,378 76,886 78,423 79,992 384,579 74 Cayenta-Bill Redesign - 150,000 - - - - 150,000 76 Cayenta Upgrade - - - 250,000 - - 250,000 77 Allocation Cayenta Application Enhancements - 172,000 175,440 178,949 182,528 186,178 895,095 78 150 - Customer Care Total - 481,540 357,218 556,835 312,971 319,230 2,027,794 79 Customer Relations Total - 915,518 590,943 832,609 627,269 694,225 3,660,564 80 Power Resources 81 108 - Power Production 82 SLP Decommissioning - 100,000 480,000 175,000 450,000 250,000 1,455,000 83 GT1 Major Overhaul - 2,500,000 - - - - 2,500,000 84 Silver Lake Dam Ownership - - 1,240,000 - - - 1,240,000 85 108 - Power Production Total - 2,600,000 1,720,000 175,000 450,000 250,000 5,195,000 86 111 - Allocation Power Production - 245,000 710,000 285,000 345,000 120,000 1,705,000 87 147 - Allocation Facilities - 200,000 199,600 164,292 204,077 88,958 856,927 88 Power Resources Total - 3,045,000 2,629,600 624,292 999,077 458,958 7,756,927 89 General Manager 90 134 - Electric Operating Contingency - 300,000 300,000 300,000 300,000 300,000 1,500,000 91 General Manager Total - 300,000 300,000 300,000 300,000 300,000 1,500,000 92 Total Major Maintenance - External Expenditures 90,000 7,549,154 6,489,443 4,413,651 4,444,531 4,151,278 27,048,056 Section 2 - Page 1 Rochester Public Utilities Electric Utility 2022 - 2026 Capital Improvement Plan A B C D E F G H Description 2022 2023 2024 2025 2026 Total 4 Multi Year Project 5 Core Services 6 107 - System Operations & Transmission 7 OSI SCADA Version Upgrade - - - 100,000 - 300,000 400,000 9 107 - System Operations & Transmission Total - - - 100,000 - 300,000 400,000 10 113 - Construction, Maintenaqnce and Field Operations 13 Alloc-New Service Installations - 625,000 643,750 663,055 682,950 703,400 3,318,155 14 Alloc-Distribution Lines & Equipment Capital - 240,000 247,200 254,620 262,260 270,125 1,274,205 15 Alloc-Property Damage - Repair/Replace - 110,000 113,300 116,700 120,205 123,805 584,010 16 Alloc-T&D Equipment Upgrade/Replace - 75,000 55,000 50,000 50,000 50,000 280,000 17 113 - Construction, Maintenaqnce and Field Operations Total - 1,050,000 1,059,250 1,084,375 1,115,415 1,147,330 5,456,370 18 114 - Technical Services 19 Load Management Installations - Res&Comm - 7,500 7,500 7,500 7,500 7,500 37,500 20 Substation/Shop Test Equip Upgr & Repl - 90,000 70,000 40,000 40,000 40,000 280,000 21 Substation Spares and Replacements - 33,000 20,000 20,000 20,000 20,000 113,000 22 Web-Based Service Application - 10,000 - - - - 10,000 23 Northern Hills Circuit Breaker Replacement - 90,000 - - - - 90,000 24 Zumbro River Sub Control Bldg Improvements - 50,000 - - - - 50,000 25 Magne Blast Breaker Replacement - 290,000 290,000 290,000 - - 870,000 26 114 - Technical Services Total - 570,500 387,500 357,500 67,500 67,500 1,450,500 27 114 - Allocation Technical Services 28 Alloc-Substation Asset Management Capital - 130,000 150,000 120,000 120,000 120,000 640,000 29 114 - Allocation Technical Services Total - 130,000 150,000 120,000 120,000 120,000 640,000 30 116 - Engineering 31 48th St NE Feeder Ext 600,000 350,000 250,000 - - - 600,000 32 60th Ave NW Right of Way Purchase - 50,000 50,000 50,000 - 100,000 250,000 33 Capacitor Control Replacement (10 controlers/yr) - 35,000 - - - - 35,000 36 NorthernHills 65th St Feeder - - - - - 550,000 550,000 37 Feeder 306 Install - - - - - 300,000 300,000 38 Feeder 615 Install - - - 350,000 - - 350,000 39 Feeder 715 Install 490,000 340,000 150,000 - - - 490,000 40 Feeder 913 Install - - - - 300,000 - 300,000 41 Feeder 914 Install - - - - - 300,000 300,000 42 Feeder 1315 Install - - - 400,000 - - 400,000 43 Feeder 1602 Install - - - - 300,000 - 300,000 44 Feeder 1733 Install - - - 200,000 - - 200,000 45 Feeder 1911 Install - - - 140,000 - - 140,000 46 Feeder 1912 Install - - 500,000 500,000 - - 1,000,000 47 Feeder 1913 Install - - - - - 1,000,000 1,000,000 48 Downtown New Duct Systems - - - - 560,000 1,100,000 1,660,000 49 Downtown New Feeder Extensions - - - - - 2,000,000 2,000,000 50 65th St - 50th Ave To 60th Ave - 510,000 - - - - 510,000 51 65th St - 34th To 50th AveNW - - 900,000 - - - 900,000 52 Q2-Rebuild From Bear Creek - RCTC - - - - - 350,000 350,000 53 Q4-Rebuild From BV Sub To Salem Rd - - - 450,000 450,000 - 900,000 54 Q7-Rebuild To Grade B - - - - 400,000 400,000 800,000 55 Q11-W.C.To New St.Bridget Sub ROW - 260,000 - - - - 260,000 56 IBM Substation Upgrade - - - - 200,000 200,000 400,000 58 Fiber OWEF Splice To Chester - - - - 300,000 - 300,000 59 Small Cell Antennas - - 100,000 - - - 100,000 61 Marion Rd Substation & Feeder Buildout 30,625,806 20,298,869 10,326,937 - - - 30,625,806 62 Hydro Line Reconfig For New Hydro Sub - - - - - 200,000 200,000 63 New Padmount Hydro Sub - - - - 300,000 - 300,000 64 New Mayo Feeders 2,700,000 200,000 2,500,000 - - - 2,700,000 65 Mayo-Feeders To St.Mary's - - - - - 2,000,000 2,000,000 66 Substation Communication - 1,250,000 - - - - 1,250,000 67 Volt/VAR Optimization - - - - 200,000 200,000 400,000 69 Solar DER Feeder Interconnections - 50,000 - - - - 50,000 70 BRT Charging Stations - - 200,000 300,000 - - 500,000 71 Substation Capacitor Bank Bamber Valley - - - - 150,000 - 150,000 72 PLS-CAD Distribution Modeling Software - - 50,000 - - - 50,000 73 116 - Engineering Total 34,415,806 23,343,869 15,026,937 2,390,000 3,160,000 8,700,000 52,620,806 74 116 - Allocation Engineering 75 Alloc-Feeder Extensions - 278,600 50,000 56,000 275,000 575,000 1,234,600 76 Alloc-Feeder Rebuilds - 130,000 145,000 275,000 145,000 190,000 885,000 77 Alloc-Transmission Projects - 40,000 40,000 45,000 45,000 50,000 220,000 78 Alloc-Substation Projects - 75,000 110,000 145,000 215,000 220,000 765,000 79 Alloc-Road Projects - 225,000 200,000 450,000 425,000 550,000 1,850,000 80 Alloc-Road Projects DMC - 600,000 750,000 500,000 450,000 550,000 2,850,000 81 Alloc-Manhole Switch Replacement - 90,000 95,000 100,000 100,000 105,000 490,000 82 Alloc-Cable Replacement - 250,000 250,000 400,000 450,000 500,000 1,850,000 83 Alloc-Manhole Repair/Replacement - 275,000 300,000 300,000 325,000 350,000 1,550,000 84 Alloc-Capacitor Bank Installations - 20,000 20,000 50,000 20,000 50,000 160,000 85 Alloc-FiberOptic Projects - 115,000 90,000 90,000 90,000 90,000 475,000 86 Alloc-Distribution Transformers - 650,000 675,000 700,000 725,000 750,000 3,500,000 87 Alloc-Overhead To Underground Conversions - 325,000 375,000 475,000 400,000 450,000 2,025,000 88 Alloc-Pole Replacements - 44,000 48,000 53,000 60,000 70,000 275,000 89 116 - Allocation Engineering Total - 3,117,600 3,148,000 3,639,000 3,725,000 4,500,000 18,129,600 90 117 - GIS 91 Dual Sensor Drone - - 30,000 - - - 30,000 92 Survey GPS Replacement - - 40,000 - - - 40,000 94 GIS Utility Network Implementation - 80,000 - - - - 80,000 95 117 - GIS Total - 80,000 70,000 - - - 150,000 96 119 - Metering 98 AMI - Bond Funded - - 2,985,004 5,721,868 5,028,342 1,650,000 15,385,214 99 Metering/Shop Test Equip Upgr & Repl - 15,000 25,000 20,000 55,000 20,000 135,000 100 Allocation-Electric Metering - 146,200 130,000 20,000 20,000 100,000 416,200 101 119 - Metering Total - 161,200 3,140,004 5,761,868 5,103,342 1,770,000 15,936,414 102 135 - Director 103 Service Territory Payments - 233,360 225,000 229,500 234,090 238,772 1,160,722 104 Service Territory Payments-SMMPA Reimb - (116,185) (112,500) (114,750) (117,045) (119,386) (579,866) 105 135 - Director Total - 117,175 112,500 114,750 117,045 119,386 580,856 Section 2 - Page 3 Rochester Public Utilities Electric Utility 2022 - 2026 Capital Improvement Plan A B C D E F G H Description 2022 2023 2024 2025 2026 Total 4 Multi Year Project 106 Core Services Total 34,415,806 28,570,344 23,094,191 13,567,493 13,408,302 16,724,216 95,364,546 107 Corporate Services 108 141 - Inventory Management 109 Racking Replacement In Stockyard - - 20,000 20,000 - - 40,000 110 141 - Inventory Management Total - - 20,000 20,000 - - 40,000 111 144 - Information Technology 112 Change Management Tool 50,000 25,000 25,000 - - - 50,000 113 NSX Implementation 142,000 42,000 100,000 - - - 142,000 114 Business Intelligence/Reporting - 45,000 45,000 45,000 45,000 45,000 225,000 115 Phone System - PRI to SIP - - 50,000 - - - 50,000 116 144 - Information Technology Total 192,000 112,000 220,000 45,000 45,000 45,000 467,000 117 144 - Allocation Information Technology 118 Alloc-Backup/DR - 50,000 - - 35,000 - 85,000 119 Alloc-Network Management - 96,000 127,000 197,000 110,000 89,000 619,000 120 Alloc-Output Management - 18,000 16,000 16,000 16,000 16,000 82,000 121 Alloc-Server Management - 196,000 111,000 61,000 61,000 196,000 625,000 122 Alloc-Workstation Management - 138,000 138,000 148,000 128,000 128,000 680,000 123 Alloc-Storage Management - - - - 175,000 - 175,000 124 Alloc-Operation Technology - 80,000 80,000 180,000 130,000 240,000 710,000 125 144 - Allocation Information Technology Total - 578,000 472,000 602,000 655,000 669,000 2,976,000 126 Corporate Services Total 192,000 690,000 712,000 667,000 700,000 714,000 3,483,000 127 Customer Relations 128 150 - Customer Care 130 Payment Kiosk - 50,800 - - - - 50,800 131 150 - Customer Care Total - 50,800 - - - - 50,800 132 Customer Relations Total - 50,800 - - - - 50,800 133 Power Resources 134 108 - Power Production 135 GT2 Controls Upgrade - 500,000 - - - - 500,000 137 108 - Power Production Total - 500,000 - - - - 500,000 138 111 - Allocation Power Production 139 Allocation-Power Resources Capital - 550,000 535,000 325,000 495,000 750,000 2,655,000 140 111 - Allocation Power Production Total - 550,000 535,000 325,000 495,000 750,000 2,655,000 141 146 - Fleet 142 Allocation-Fleet - 694,848 631,624 677,364 751,250 651,286 3,406,372 143 Pickup - T&D Lead Lineman - 50,000 - - - - 50,000 144 Pickup-SLPI & C - 82,682 - - - - 82,682 145 Underground Tool Truck/Trailer - - 65,000 - - - 65,000 146 TSE Cable Puller - 195,000 - - - - 195,000 147 3-Reel Cable Trailer - 135,000 - - - - 135,000 148 146 - Fleet Total - 1,157,530 696,624 677,364 751,250 651,286 3,934,054 149 147 - Facilities 151 A-Wing Renovation - 228,340 200,000 170,000 170,000 - 768,340 152 Allocation-Facilities Capital - 30,000 30,000 30,000 30,000 30,000 150,000 153 147 - Facilities Total - 258,340 230,000 200,000 200,000 30,000 918,340 154 Power Resources Total - 2,465,870 1,461,624 1,202,364 1,446,250 1,431,286 8,007,394 155 General Manager - 700,000 700,000 700,000 700,000 700,000 3,500,000 156 Total External Expenditures 34,607,806 32,477,014 25,967,815 16,136,857 16,254,552 19,569,502 110,405,740 157 158 Less: Bonding - (2,985,004) (5,721,868) (5,028,342) (1,650,000) (15,385,214) 159 Less: Contribution in Aid of Construction (14,204,097) (11,843,346) (366,015) (377,000) (3,138,290) (29,928,748) 160 161 18,272,917 11,139,465 10,048,974 10,849,210 14,781,212 65,091,778 Net Capital External Expenditures (Rate Funded) 162 163 Total Internal Expenditures (Capital Labor) 5,423,293 6,388,557 6,146,306 5,850,423 6,745,117 30,553,696 164 165 Net Capital Expenditures 23,696,210 17,528,022 16,195,280 16,699,633 21,526,329 95,645,474 Section 2 - Page 4 ROCHESTER PUBLIC UTILITIES 2022 WATER UTILITY OPERATING BUDGET ROCHESTER PUBLIC UTILITIES WATER UTILITY 2022 OPERATING BUDGET INDEX Title Pages Basic Assumptions 1 Forecast by Year 2021 through 2026 2 Condensed Income Statement 3 Revenue Sources & Expense Categories 4 Operating Expenditures Graph 5 Production & Sales Statistics Forecast 6 Section 3 ROCHESTER PUBLIC UTILITIES WATER UTILITY 2022 OPERATING BUDGET BASIC ASSUMPTIONS • Interest Earnings Rate: 1.80% • Average Salary Expense Change: 3.1% (excluding headcount additions) (consists of COLA, merit and promotion increases) • Change in Full-time Equivalents: 0 • Anticipated Bonding: $12,150,000 - 2023 (AMI) • Minimum Cash Reserve Requirement: Policy Amount $6,473,800 RETAIL REVENUES / SALES • Revenue Adjustment: 2.5% proposed • Water CCF Sales Forecast: 4.87% Decrease from 2021 Projected Sales 1.0% Increase over Y/E 2021 Projected Customers • Total Water Utility Customers: 530 Cooling Degree Days, • Forecast Assumes Normal Weather : 20.6 Inches Summer Rainfall OTHER ITEMS • In Lieu of Tax forecast decreasing $26,656 to a total of $369,480. Section 3 - Page 1 ROCHESTER PUBLIC UTILITIES WATER UTILITY Management Reporting P&L Historical Data in 000's 2019 2020 2021 F2 2022 2023 2024 2025 2026 RPU Rate Increase 6.0% 3.5% 0.0% 2.5% 6.5% 6.5% 6.5% 6.5% 1 Revenue 2 Retail Water $9,959 $10,665 $11,083 $10,854 $11,653 $12,481 $13,370 $14,271 3 Other Services & Fees $1,698 $1,423 $1,440 $1,959 $1,991 $2,023 $2,056 $2,090 4 Total Revenue $11,657 $12,088 $12,523 $12,812 $13,643 $14,504 $15,426 $16,361 5 Cost of Revenue 6 Water Supply $1,682 $1,758 $1,928 $1,847 $1,889 $1,925 $1,962 $1,988 7 Total Cost of Revenue $1,682 $1,758 $1,928 $1,847 $1,889 $1,925 $1,962 $1,988 8 Gross Margin 9 Retail Water $8,277 $8,908 $9,155 $9,007 $9,764 $10,556 $11,408 $12,283 10 Other Services & Fees $1,698 $1,423 $1,440 $1,959 $1,991 $2,023 $2,056 $2,090 11 TOTAL GROSS MARGIN $9,975 $10,331 $10,595 $10,965 $11,754 $12,579 $13,464 $14,372 12 Controllable Costs 13 Salaries & Benefits $3,026 $3,065 $3,200 $3,364 $3,631 $3,751 $3,959 $4,100 14 Other Operating Expenses $1,310 $1,145 $1,355 $1,587 $1,597 $1,628 $1,652 $1,689 15 Major Maintenance $323 $521 $374 $745 $410 $255 $460 $495 16 Non-Bonded Capital Projects $1,712 $2,441 $5,765 $3,437 $7,435 $3,722 $3,553 $4,680 17 TOTAL CONTROLLABLE COSTS $6,371 $7,172 $10,695 $9,133 $13,073 $9,357 $9,624 $10,964 18 Depreciation & Amortization $2,742 $2,745 $2,861 $2,968 $3,077 $3,176 $3,229 $3,377 19 Less Non Bonded Projects (capitalized) ($1,712) ($2,441) ($5,765) ($3,437) ($7,435) ($3,722) ($3,553) ($4,680) 20 Less Total Internal Costs (capitalized) ($270) ($426) ($578) ($374) ($301) ($355) ($340) ($288) 21 Interutility Allocation $1,534 $1,737 $1,875 $1,862 $1,899 $1,937 $1,976 $2,016 22 Total Operating Expenses $8,664 $8,788 $9,088 $10,153 $10,313 $10,392 $10,936 $11,389 Net Operating Income (Loss) $1,311 $1,543 $1,507 $813 $1,442 $2,187 $2,528 $2,983 23 24 Financing & Other Non-Operating Items: 25 Bond & Interest Related Expenses ($1) ($1) ($0) $0 $0 ($547) ($502) ($456) 26 Interest Income $201 $223 $203 $200 $206 $238 $237 $249 $0 $0 $0 $0 $0 Misc Non-Operating Income (Expense) ($31) ($5) $0 27 28 Total Financing & Non-Operating Items $169 $218 $203 $200 $206 ($309) ($266) ($206) 29 Income Before Transfers or Capital Contributions $1,480 $1,761 $1,710 $1,013 $1,647 $1,878 $2,262 $2,777 30 Transfers (In Lieu of Taxes) ($358) ($385) ($396) ($369) ($379) ($387) ($394) ($398) 31 Capital Contributions $891 $1,283 $1,106 $1,100 $1,100 $1,100 $1,100 $1,100 32 Cash Transfers from City/Intercompany $0 $0 $0 $90 $4,010 $0 $0 $1,550 NET INCOME $2,013 $2,660 $2,420 $1,834 $6,378 $2,592 $2,968 $5,028 33 NET INCOME (Excluding Contrib & Cash Tfrs from City) $1,314 $644 $1,268 $1,492 $1,868 $2,378 34 $ 5,159 $ 5,399 $ 5,525 $ 5,646 $ 5,800 TARGET NET INCOME $ 5,029 35 Excess (Deficit) from Target $ (3,715) 36 $ (4,515) $ (4,131) $ (4,034) $ (3,778) $ (3,422) 1/01 Cash Balance $ 10,529 $ 11,975 $ 11,283 $ 11,194 $ 11,866 $ 11,511 $ 11,682 37 38 Change in Net Assets 2,659 2,420 1,834 6,378 2,592 2,968 5,028 39 Depreciation & Amortization 2,745 2,861 2,968 3,077 3,176 3,229 3,377 40 Capital Additions (2,866) (6,343) (3,811) (7,881) (10,018) (8,308) (4,968) 41 Non-Cash Contributions (1,283) (1,106) (1,100) (1,100) (1,100) (1,100) (1,100) 42 Debt Principal Payments - (0) 0 - (989) (1,033) (1,080) 43 Debt Proceeds - (0) 0 12,150 - - 0 44 Net Change in Other Assets/Liabilities 191 1,476 20 (11,953) 5,984 4,415 - 45 Net Changes in Cash 1,446 (693) (88) 672 (355) 171 1,257 46 12/31 Cash Balance $ 11,975 $ 11,283 $ 11,194 $ 11,866 $ 11,511 $ 11,682 $ 12,939 $ 6,474 $ 6,449 $ 6,326 $ 6,321 $ 6,417 Mimimum Cash Reserve $ 7,908 $ 8,529 47 Excess (Deficit) from Miminum Cash Reserve $ 4,067 $ 2,753 48 $ 4,720 $ 5,417 $ 5,185 $ 5,361 $ 6,522 Section 3 - Page 2 ROCHESTER PUBLIC UTILITIES WATER UTILITY Management Reporting P&L Historical Data 2021 2022 Variance % 2022 to in 000's 2019 2020 Orig Bdgt 2021 F2 2022 Orig Bdgt Orig Bdgt Variance 1 Revenue 2 Retail Water $9,959 $10,665 $10,993 $11,083 $10,854 $11,431 ($578) -5.1% Other Services & Fees $1,698 $1,423 $1,449 $1,440 $1,959 $1,476 $483 32.7% 3 Total Revenue $11,657 $12,088 $12,442 $12,523 $12,812 $12,907 ($94) -0.7% 4 5 Cost of Revenue Water Supply $1,682 $1,758 $1,822 $1,928 $1,847 $1,822 $25 1.4% 6 Total Cost of Revenue $1,682 $1,758 $1,822 $1,928 $1,847 $1,822 $25 1.4% 7 8 Gross Margin 9 Retail Water $8,277 $8,908 $9,171 $9,155 $9,007 $9,610 ($603) -6.3% Other Services & Fees $1,698 $1,423 $1,449 $1,440 $1,959 $1,476 $483 32.7% 10 TOTAL GROSS MARGIN $9,975 $10,331 $10,620 $10,595 $10,965 $11,085 ($120) -1.1% 11 12 Controllable Costs 13 Salaries & Benefits $3,026 $3,065 $3,108 $3,200 $3,364 $3,451 ($87) -2.5% 14 Other Operating Expenses $1,310 $1,145 $1,281 $1,355 $1,587 $1,306 $281 21.5% 15 Major Maintenance $323 $521 $528 $374 $745 $455 $290 63.7% Non-Bonded Capital Projects $1,712 $2,441 $6,808 $5,765 $3,437 $8,396 ($4,959) -59.1% 16 TOTAL CONTROLLABLE COSTS $6,371 $7,172 $11,725 $10,695 $9,133 $13,608 ($4,475) -32.9% 17 18 Depreciation & Amortization $2,742 $2,745 $2,910 $2,861 $2,968 $3,041 ($73) -2.4% 19 Less Non Bonded Projects (capitalized) ($1,712) ($2,441) ($6,808) ($5,765) ($3,437) ($8,396) $4,959 -59.1% 20 Less Total Internal Costs (capitalized) ($270) ($426) ($484) ($578) ($374) ($360) ($13) 3.7% Interutility Allocation $1,534 $1,737 $1,719 $1,875 $1,862 $1,753 $109 6.2% 21 Total Operating Expenses $8,664 $8,788 $9,063 $9,088 $10,153 $9,646 $507 5.3% 22 Net Operating Income (Loss) $1,311 $1,543 $1,558 $1,507 $813 $1,439 ($626) -43.5% 23 24 Financing & Other Non-Operating Items: 25 Bond & Interest Related Expenses ($1) ($1) $0 ($0) $0 $0 $0 0.0% 26 Interest Income $201 $223 $169 $203 $200 $154 $47 30.3% 27 Misc Non-Operating Income (Expense) ($31) ($5) $0 $0 $0 $0 $0 0.0% Total Financing & Non-Operating Items $169 $218 $169 $203 $200 $154 $47 30.3% 28 Income Before Transfers or Capital Contributions $1,480 $1,761 $1,727 $1,710 $1,013 $1,593 ($580) -36.4% 29 30 Transfers (In Lieu of Taxes) ($358) ($385) ($383) ($396) ($369) ($391) $21 -5.5% 31 Capital Contributions $891 $1,283 $1,100 $1,106 $1,100 $1,100 $0 0.0% 32 Cash Transfers from City $0 $0 $85 $0 $90 $4,030 ($3,940) -97.8% NET INCOME $2,013 $2,660 $2,529 $2,420 $1,834 $6,332 ($558) -8.8% 33 34 1/01 Cash Balance $ 10,529 $ 10,109 $ 11,975 $ 11,283 $ 8,878 $ 2,404 27.1% 35 Change in Net Assets 2,659 2,529 2,420 1,834 6,332 (4,498) -71.0% 36 Depreciation & Amortization 2,745 2,910 2,861 2,968 3,041 (73) -2.4% 37 Capital Additions/Service Territory Comp (2,866) (7,292) (6,343) (3,811) (8,756) 4,945 -56.5% 38 Non-Cash Contributions (1,283) (1,100) (1,106) (1,100) (1,100) - 0.0% 39 Debt Principal Payments - 0 (0) 0 - 0 0.0% 40 Debt Proceeds - 0 (0) 0 - 0 0.0% 41 Net Change in Other Assets/Liabilities 191 980 1,476 20 (30) 50 -168.9% 42 Net Changes in Cash 1,446 (1,973) (693) (88) (513) 424 -82.8% 43 12/31 Cash Balance $ 11,975 $ 8,136 $ 11,283 $ 11,194 $ 8,366 $ 2,828 33.8% Mimimum Cash Reserve $ 7,908 $ 8,529 $ 8,529 $ 6,474 $ 8,803 $ (2,329) -26.5% 44 45 Excess (Deficit) from Miminum Cash Reserve $ 4,067 $ (393) $ 2,753 $ 4,720 $ (437) $ 5,158 -1179.4% Section 3 - Page 3 GROSS $11,999,674 USES $10,965,331 MARGIN ROCHESTER PUBLIC UTILITIES WATER UTILITY 2022 OPERATING BUDGET Section 3 - Page 4 Water Expenditures Operating Section 3 - Page 5 ROCHESTER PUBLIC UTILITIES PRODUCTION & SALES STATISTICS FORECAST WATER UTILITY 2021 F2 2022 2023 2024 2025 2026 CCF Pumped 5,543,343 5,273,552 5,303,331 5,302,905 5,302,013 5,253,743 1 % Change -5.6% -4.9% 0.6% 0.0% 0.0% -0.9% 2 Retail CCF 5,539,237 5,269,646 5,299,403 5,298,978 5,298,086 5,249,852 3 % Change -1.0% -4.9% 0.6% 0.0% 0.0% -0.9% 4 Number of Customers 5 Residential 37,586 37,969 38,355 38,745 39,139 39,537 6 Commercial 3,660 3,690 3,720 3,751 3,783 3,815 7 Industrial 23 23 23 23 23 23 8 Interdepartmental 1 1 1 1 1 1 9 Total Customers 41,270 41,683 42,099 42,520 42,946 43,376 10 % Change 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 11 Section 3 - Page 6 ROCHESTER PUBLIC UTILITIES 2022 WATER UTILITY CAPITAL IMPROVEMENT AND MAJOR MAINTENANCE BUDGET ROCHESTER PUBLIC UTILITIES WATER UTILITY 2022 CAPITAL IMPROVEMENT AND MAJOR MAINTENANCE BUDGET INDEX Title Pages 5 Year Project List: Major Maintenance 1 Capital 2 Section 4 Rochester Public Utilities Water Utility 2022 - 2026 Major Maintenance Plan A B C D E F G H Multi Year Total Row Labels 2022 2023 2024 2025 2026 4 Project Total 5 Water Compliance 6 124 - Water Compliance 7 Old Municipal Wells Sealing Project 30,000 30,000 30,000 30,000 - 120,000 8 Olmsted County Well Sealing 100,000 - - - - 100,000 10 124 - Water Compliance Total 130,000 30,000 30,000 30,000 - 220,000 11 Water Compliance Total 130,000 30,000 30,000 30,000 - 220,000 12 Water Core Services 13 127 - Allocation Water Distribution System 14 Alloc-Water Storage Facility Painting 355,000 295,000 135,000 300,000 400,000 1,485,000 15 127 - Allocation Water Distribution System Total 355,000 295,000 135,000 300,000 400,000 1,485,000 16 128 - Water Engineering 17 Water Cost-of-Service/Rate Design Study 35,000 - - 35,000 - 70,000 18 Water Utility Operation Contingency Fund 80,000 85,000 90,000 95,000 95,000 445,000 20 Communication Study 125,000 - - - - 125,000 21 128 - Water Engineering Total 240,000 85,000 90,000 130,000 95,000 640,000 22 Water Core Services Total 595,000 380,000 225,000 430,000 495,000 2,125,000 23 Water Power Resources 24 123 - Allocation Water Facilities 25 Alloc-Facilities Maintenance Water 20,000 - - - - 20,000 26 123 - Allocation Water Facilities Total 20,000 - - - - 20,000 27 Water Power Resources Total 20,000 - - - - 20,000 28 Total Major Maintenance - External Expenditures 745,000 410,000 255,000 460,000 495,000 2,365,000 Section 4 - Page 1 Rochester Public Utilities Water Utility 2022 - 2026 Capital Improvement Plan Multi Year Total Row Labels 2022 2023 2024 2025 2026 Project Total Water Compliance 124 - Water Compliance Well 16 Conversion 75,000 - - - - 75,000 Olmsted County Well Conversion - 80,000 - - - 80,000 124 - Water Compliance Total 75,000 80,000 - - - 155,000 Water Compliance Total 75,000 80,000 - - - 155,000 Water Core Services 127 - Allocation Water Distribution System Alloc-Replacement Of Pumping Units 88,800 90,800 92,000 92,900 94,700 459,200 Alloc-Well Motor Replacements 13,875 19,000 19,500 19,500 20,000 91,875 Alloc-Install Variable Frequency Drive Units 22,650 19,650 19,700 15,250 16,800 94,050 Alloc-Replacement Of Booster Pumps 17,250 23,000 23,000 23,000 23,000 109,250 Alloc-Residential Water Metering/AMR 145,965 198,500 202,500 206,500 210,500 963,965 Alloc-Commercial Water Metering/AMR 93,750 127,500 130,000 132,500 135,250 619,000 127 - Allocation Water Distribution System Total 382,290 478,450 486,700 489,650 500,250 2,337,340 127 - Water Distribution System Install New AC Units at Wells and Boosters 36,225 37,493 38,805 40,164 41,569 194,256 Water AMI Implementation 67,291 144,845 5,940,026 4,732,708 - 10,884,870 Well & Booster Station Metering 10,900 11,300 11,675 12,100 12,500 58,475 Chlorine Sensor Replacement 23,801 24,633 - - - 48,434 127 - Water Distribution System Total 138,217 218,271 5,990,506 4,784,972 54,069 11,186,035 128 - Water Engineering Marion Rd Duct Project 580,000 - - 580,000 Center ST to 11th Ave E - - 1,084,750 - - 1,084,750 Center St to 16th Ave West - - - - 640,000 640,000 New Wells 635,000 - 480,000 750,000 - 1,865,000 Water Utility Project Contingency Fund 175,000 180,000 180,000 185,000 185,000 905,000 New Marion IL1.0MG Reservoir - - - - 1,550,000 1,550,000 Building Replacement-Well #26 100,000 - - - - 100,000 1.0MG Baihly High Level Tower 4,100,000 90,000 4,010,000 - - - 4,100,000 Willow Heights High Level Booster Station 330,000 - - - - 330,000 128 - Water Engineering Total 4,100,000 1,330,000 4,770,000 1,744,750 935,000 2,375,000 11,154,750 128 - Allocation Water Engineering Alloc-T&D City Projects 251,000 154,000 200,000 385,000 200,000 1,190,000 Alloc-T&D Developer Projects 100,000 200,000 200,000 200,000 200,000 900,000 Alloc-T&D RPU Projects 200,000 400,000 200,000 800,000 1,000,000 2,600,000 128 - Allocation Water Engineering Total 551,000 754,000 600,000 1,385,000 1,400,000 4,690,000 128 - DMC Water Engineering DMC-Discovery Walk 630,500 480,000 150,500 - - - 630,500 DMC-Broadway N, Zumbro River Bridge North to Elton Hills Dr - - 350,000 350,000 - 700,000 DMC-6th St SE Bridge Construction - - - - 210,000 210,000 DMC-3rd Ave SW From 2nd To 4th St SW - - 160,000 - - 160,000 DMC-Block 6 Ramp Water Main 221,000 - - - - 221,000 DMC-Rochester Rapid Transit 2nd St SW Recon - 880,000 150,000 - - 1,030,000 128 - DMC Water Engineering Total 630,500 701,000 1,030,500 660,000 350,000 210,000 2,951,500 Water Core Services Total 4,730,500 3,102,507 7,251,221 9,481,956 7,944,622 4,539,319 32,319,625 Water Power Resources 125 - Water Fleet 259,440 248,459 180,480 23,808 141,000 853,187 Total External Expenditures 4,730,500 3,436,947 7,579,680 9,662,436 7,968,430 4,680,319 33,327,812 Total Internal Expenditures 373,711 301,479 355,225 339,954 287,748 1,658,117 Total Contributed Assets 1,100,000 1,100,000 1,100,000 1,100,000 1,100,000 5,500,000 Less: Water Accessability Funds (90,000) (4,010,000) - - (1,550,000) (5,650,000) Less: Bond Funded - (144,845) (5,940,026) (4,415,129) - (10,500,000) Total Net Capital Expenditures 4,820,658 4,826,314 5,177,635 4,993,255 4,518,067 24,335,929 Section 4 - Page 2