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***FINANCE MINUTES*** May 5, 2026 SAUKVILLE MUNICIPAL CENTER AND VIA ZOOM 639 E. GREEN BAY AVE., SAUKVILLE, WI 53080 Village President Andy Hebein called the meeting to order at 6:00 p.m. Julie Friede gave the Statement of Public Notice. Members: Andy Hebein-present, Jim Nowlen-present, Bill Rudolph-present, Jesse Duckart-present, Pamela Duckart-present, Wendy Smith-present, and Brandon Donen-via zoom. Others Present: Dawn Wagner , Julie Friede , Jacob Verhelst, Dale Kropidlowski, Ray Hartmann, Scott Fischer, Kayla Thorpe – Ehlers and Bridgot Gysbers-Ehlers. Approve Claims for April 2026 in the Amount of $487,715.60. Rudolph/Nowlen made a motion to approve Claims for April 2026 in the Amount of $ 487,715.60. Motion Carried. Investment Report Wagner stated the March 2026 Investment Report was provided in the packet. 2026 Water Rate Study – Phase 2: PSC CRC Application & Updated LRCFA – Sewer Utility Cash Flow Update (Ehlers) Thorpe provide an overview of the 2026 Water Rate Study & Sewer Utility Cash Flow Update. (Presentation Attached) Thorpe stated the last Conventional Rate Case (CRC) was completed on March 31, 2016 with a 25% increase to the Village of Saukville Water Rate. She noted a Simplified Rate Case (SRC) of 3% took effect on January 1, 2026. Thorpe added in 2027 a 14.49% increase is recommended to fund ongoing operation and the Eastside Water Loop project. Thorpe provide an overview of the Sewer Utility Cash Flow. (Page 10) Thorpe states the Saukville Sewer Utility has a healthy cash reserve; minimal increases will be needed to complete future projects. Nowlen/Smith made a motion to authorize Ehlers to file the PSC CRC Application. Motion Carried. Other Matters Saukville Elementary School Ground Breaking at 309 Orchard Ln. on May 15, 2026 at 12:30 p.m. Mid-Moraine Dinner Meeting will be hosted by the Village of Saukville on Wednesday, May 27, 2026 at the American Legion Hall. Please respond to Clerk Friede if you plan to attend. Ozaukee Economic Development (OED) 2026 Outreach Event is on May 13, 2026 at Shully’s in Thiensville at 4:30 p.m. Finance Committee Minutes April 8, 2026 H:\Minutes\Finance Minutes - 2026\Finance - May 5, 2026 - draft.docx Public Works Committee will meet on Tuesday, June 2, 2026 at 4:00 p.m. On Friday, May 29 th Saukville Elementary School (SES) has two 4 th Grade Students that will be Village President for the day. They will come to Village Hall at 8:00 a.m. to have a tour of the departments and return to SES for a Proclamation Ceremony at 12:00 p.m. ADJOURNMENT Nowlen/P. Duckart made a motion to adjourn. Motion carried at 6:32 p.m. Julie Friede Village Clerk Village of Saukville, WI 2026 Water Rate Study Phase 2: PSC CRC Application & Updated LRCFA Sewer Utility Cash Flow Update May 5, 2026 Finance Committee Meeting 2 Why are we here? Phase 1 presented 8/20/2025: Initial Long-Range Cash Flow Analysis indicated rate adjustment of 13.44% to current PSC math. Utility is requesting a rate increase to fund the Eastside Water Loop and to cover the associated debt service, while ensuring continued system reliability and financial stability. 9/19/2025: Phase 2 was approved and since then Ehlers completed PSC CRC Application with assistance from Village staff. Tonight: Ehlers to present initial results of application and seek consensus to file application as presented, or with any discussed changes. 3 • Last Conventional Rate Case (CRC) completed ✓ March 31, 2016 (25% increase) • Last Simplified Rate Case (SRC) implemented ✓ Filed with the PSC on October 9, 2025 ✓ PSC approved the SRC for a 3% increase that took effect January 1, 2026 Water Rate Historical Information 4 Water Rate Application Initial Results • Current Benchmark ROR is 6.4% • Subject to PSC review and approval • Revenue is needed to fund ongoing operations and the Eastside Water Loop project. Est Application Component Description 2021 2022 2023 2024 2025 2026 Cash Basis 1 O&M and PILOT $868,469 $1,087,124 $935,510 $1,198,536 $1,220,830 $1,300,476 2 Debt $701,629 $434,627 $508,483 $395,366 $309,774 $432,153 3 Cash Funded Capital $70,163 $327,544 $395,430 $150,034 $30,977 $43,215 Less: Other Revenue $43,741 $40,592 $43,300 $57,188 $54,753 $55,800 Interest Income $3,836 $13,963 $46,366 $54,321 $25,000 $25,000 Revenue Requirement $1,592,684 $1,794,740 $1,749,757 $1,632,427 $1,481,828 $1,695,044 (Costs less Other Income) User Rates Revenue $1,356,166 $1,425,775 $1,464,731 $1,583,965 $1,680,407 $1,794,410 Rate Adequacy ($236,518) ($368,965) ($285,026) ($48,462) $198,579 $99,365 Rate Adjustment Needed 17.44% 25.88% 19.46% 3.06% 0.00% 0.00% Utility Basis (PSC) 1 O&M and PILOT $868,469 $1,087,124 $935,510 $1,198,536 $1,220,830 $1,300,476 2 Depreciation $327,417 $316,961 $324,738 $333,538 $334,862 $385,520 NIRB $5,913,155 $5,666,140 $5,558,269 $5,471,995 $5,163,327 $6,627,544 Benchmark ROI % 4.90% 4.90% 6.50% 6.50% 6.20% 6.40% 3 Calculated ROI 289,745$ 277,641$ 361,287$ 355,680$ 320,126$ 424,163$ Less: Other Revenue $43,741 $40,592 $43,300 $57,188 $54,753 $55,800 Revenue Requirement $1,441,890 $1,641,134 $1,578,235 $1,830,566 $1,821,065 $2,054,359 (Costs less Other Income) User Rates Revenue $1,356,166 $1,425,775 $1,464,731 $1,583,965 $1,680,407 $1,794,410 Rate Adequacy ($85,724) ($215,359) ($113,504) ($246,601) ($140,658) ($259,949) Rate Adjustment Needed 6.32% 15.10% 7.75% 15.57% 8.37% 14.49% Revenue Requirement 5 Water LRCFA w/ PSC Application Budget 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Revenues Total Revenues from User Rates1 $1,730,819 $1,981,615 $2,281,037 $2,349,468 $2,712,571 $2,793,948 $2,877,766 $2,877,766 $2,877,766 $2,877,766 Percent Increase to User Rates 3.00% 14.49% 15.11% 3.00% 15.45% 3.00% 3.00% 0.00% 0.00% 0.00% Cumulative Percent Rate Increase 3.00% 17.92% 35.74% 39.82% 61.42% 66.27% 71.25% 71.25% 71.25% 71.25% Dollar Amount Increase to Revenues $250,796 $299,422 $68,431 $363,103 $81,377 $83,818 $0 $0 $0 Total Other Revenues $79,753 $63,217 $73,810 $75,216 $90,878 $81,747 $82,999 $84,481 $112,212 $114,044 Total Revenues $1,810,572 $2,044,832 $2,354,847 $2,424,684 $2,803,449 $2,875,695 $2,960,765 $2,962,248 $2,989,979 $2,991,810 Less: Expenses Operating and Maintenance2 $1,020,830 $1,051,265 $1,082,609 $1,114,890 $1,148,135 $1,182,373 $1,217,634 $1,253,950 $1,291,350 $1,329,868 PILOT Payment $250,000 $255,000 $260,100 $265,302 $270,608 $276,020 $281,541 $287,171 $292,915 $298,773 Net Before Debt Service and Capital Expenditures $539,742 $738,567 $1,012,138 $1,044,493 $1,384,706 $1,417,302 $1,461,590 $1,421,127 $1,405,714 $1,363,169 Debt Service Existing Debt P&I $432,153 $420,300 $325,550 $312,075 $313,375 $264,525 $265,575 $266,775 $263,250 $264,475 New (2026-2035) Debt Service P&I $0 $80,325 $301,631 $457,975 $843,881 $1,017,563 $1,015,756 $1,017,813 $1,018,600 $1,018,125 Total Debt Service $432,153 $500,625 $627,181 $770,050 $1,157,256 $1,282,088 $1,281,331 $1,284,588 $1,281,850 $1,282,600 Less: Capital Improvements $2,389,000 $2,953,000 $215,500 $4,040,000 $2,167,500 $0 $0 $0 $0 $0 Debt Proceeds $2,560,000 $3,140,000 $0 $6,785,000 $0 $0 $0 $0 $0 $0 Net Annual Cash Flow $278,589 $424,942 $169,457 $3,019,443 ($1,940,050) $135,214 $180,259 $136,539 $123,864 $80,569 Restricted and Unrestricted Cash Balance: Balance at first of year $2,887,853 $3,166,443 $3,591,384 $3,760,841 $6,780,284 $4,840,234 $4,975,448 $5,155,707 $5,292,246 $5,416,110 Net Annual Cash Flow Addition/(subtraction) $278,589 $424,942 $169,457 $3,019,443 -$1,940,050 $135,214 $180,259 $136,539 $123,864 $80,569 Balance at end of year $3,166,443 $3,591,384 $3,760,841 $6,780,284 $4,840,234 $4,975,448 $5,155,707 $5,292,246 $5,416,110 $5,496,679 "All-in" Debt Coverage 1.25 1.48 1.61 1.36 1.20 1.11 1.14 1.11 1.10 1.06 PSC Days Cash on Hand 977 1,014 931 1,629 886 908 942 966 988 1,002 Notes: Legend: 1) Assumes no changes in customer count or usage beyond Test Year. Simplified Rate Case (projected eligibility) 2) Assumes 3.00% annual inflation beyond budget year. Conventional (Full) Rate Case 3) Community Investment Plan ends in 2030. Projected 6 • Future rate increases are based on the CIP as of August 2025. Since then; ✓ Eastside Water Loop project delayed. ✓ Uncertainty on feasibility of Well #5 Iron Filter due to potential PFAS mandates. ✓ Unknown PFAS mandates may significantly change future CIP. ✓ Ehlers will update CIP in the 2026 FMP (with what is known at that time) and present updated rate projections. Water LRCFA w/ PSC Application 7 Water Impact on Avg. Res. Bill Year Increase Water Vol. Charge1 Water User Charge2 Utility Bill (Quarterly) Change Over Prior Year Utility Bill (Annual) Change Over Prior Year % of MHI (79,148) Year Tiered Serv. + PFP 2025 4.04 72.99 121.47$ 485.88$ 0.61% 2025 2026 3.00% 4.16 75.18 125.11$ 3.64$ 500.46$ 14.58$ 0.63% 2026 2027 14.49% 4.76 86.07 143.24$ 18.13$ 572.97$ 72.52$ 0.72% 2027 2028 15.11% 5.48 99.08 164.89$ 21.64$ 659.55$ 86.58$ 0.83% 2028 2029 3.00% 5.65 102.05 169.83$ 4.95$ 679.34$ 19.79$ 0.86% 2029 2030 15.45% 6.52 117.82 196.08$ 26.25$ 784.32$ 104.99$ 0.99% 2030 2031 3.00% 6.72 121.36 201.96$ 5.88$ 807.85$ 23.53$ 1.02% 2031 2032 3.00% 6.92 125.00 208.02$ 6.06$ 832.09$ 24.24$ 1.05% 2032 2033 0.00% 6.92 125.00 208.02$ -$ 832.09$ -$ 1.05% 2033 2034 0.00% 6.92 125.00 208.02$ -$ 832.09$ -$ 1.05% 2034 2035 0.00% 6.92 125.00 208.02$ -$ 832.09$ -$ 1.05% 2035 Total Change over planning period 86.55$ 346.21$ Notes: 1. Current water volumetric rate is $4.04 per 1,000 gallons for the first 20,000 gallons. 2. The water user charges include a quarterly service charge of $30.80 plus a public fire protection charge of $42.19 for a 5/8 inch meter. 3. The usage is assumed to be 12,000 Gallons per quarter. Water • Based on the average residential (4 - person home) using 12,000 gallons of water per quarter. 8 • Sorted by 12 kgal consumption column • PFP not included Quarterly Water Rate Comparison – By County Utility Name County Utility Class Minimum Quarterly Bill (0.625 inch meter) 6000 GAL 12000 GAL 15000 GAL 18750 GAL 75000 GAL Effective Date Port Washington Municipal Water Utility Ozaukee AB 27 73.16 119.32 142.4 171.25 582.4 9/1/2023 Mequon Municipal Water Utility Ozaukee AB 31.32 63.06 94.8 110.67 130.51 428.07 12/18/2023 C edarburg Light And Water C ommission Ozaukee AB 39 66.6 94.2 108 125.25 384 2/1/2026 Saukville Municipal Water Utility (Proposed) Ozaukee C 36.32 64.89 93.47 107.76 125.62 365.19 TBD Belgium Municipal Water Utility Ozaukee D 32.2 62.32 92.44 107.5 126.33 408.7 3/15/2025 Saukville Municipal Water Utility (Current) Ozaukee C 31.72 56.68 81.64 94.12 109.72 318.97 1/1/2026 Grafton Water and Wastewater Utility Ozaukee AB 29.7 53.16 76.62 88.35 103.01 322.95 9/20/2025 Brown Deer Water Public Utility Ozaukee C 24.68 44.18 63.68 73.43 85.62 265.43 12/1/2024 Village of Menomonee Falls Water Utility Ozaukee AB 11.52 37.38 63.24 76.17 92.33 309.97 1/1/2017 Fredonia Municipal Water Utility Ozaukee D 20.97 41.79 62.61 73.02 86.03 281.22 1/1/2026 • File CRC Application for Test Year 2026 ✓ Rate increase is necessary for capital project funding PSC CRC Rate Proceedings Estimated Timeline from Application Filing ✓ Audit: 2 - 3 months ✓ Public Hearing: 4 - 5 months ✓ Implementation: 6 months ✓ Subject to PSC timing • Customer Communication ✓ Best practice to notify customers of requested rate increase at time of filing PSC application (only statutory requirement is once public hearing is scheduled) ✓ Upon PSC’s acceptance of application, Ehlers will send suggested language 9 Recommendations TONIGHT’s ACTION: Approval to file PSC CRC application. Sewer Utility Cash Flow Update 10 11 Sewer History: Strengths Strong and increasing Reserves Strong “All-in” Coverage 12 Sewer Utility CIP & Sources of Funding Projects Funding 2026 2027 2028 2029 2030 2031 Totals CT 60 GENERATOR SET Cash 85,000 85,000 2015 CHEVY 4X4 Cash 44,000 44,000 2016 FORD 550 TRUCK Cash 75,000 75,000 2023 FORD F250 Cash 33,000 33,000 2020 CAT 26203 SKID STEER Cash 30,000 30,000 60,000 2025 KUBOTA 1211 LAWN MOWER Cash 12,500 12,500 2015 KUBOTA UTILITY CART Cash 8,000 8,000 BIOSOLIDS HANDLING DESIGN Cash 706,700 706,700 BIOSOLIDS HANDLING facility Revenue Debt 11,855,600 11,855,600 SANITARY SEWER RELAY (S. Mill & E. Green Bay)G.O. Debt 450,000 450,000 PRESSURE WASHER Cash 7,500 7,500 N MILL STREET - PIPEBURST - ETC. Revenue Debt 2,500,000 2,500,000 S. MAIN - SEWER MAIN RELAY & LATERAL REPAIRS (ELIMINATE LIFT STATION)Revenue Debt 1,450,000 1,450,000 CLAY STREET - (Including Ulao Street) G.O. Debt 175,000 175,000 Ulao St and Clay St (East of Ulao) Cash 20,000 20,000 COLLECTIONS REPLACEMENT FUND (Sewer Main, Laterals & Manholes)Cash 57,000 57,000 57,000 57,000 57,000 57,000 342,000 Actual CIP Costs 101,000 901,700 12,003,100 232,000 1,999,500 2,587,000 17,824,300 Sources of Funding 2026 2027 2028 2029 2030 2031 G.O. Debt 0 0 0 175,000 450,000 0 625,000 Revenue Debt 0 0 11,855,600 0 1,450,000 2,500,000 15,805,600 Cash 101,000 901,700 147,500 57,000 99,500 87,000 1,393,700 Total 101,000 901,700 12,003,100 232,000 1,999,500 2,587,000 17,824,300 13 Sewer Utility Proposed Debt Schedules AMT Year Principal Est. Rate1 Interest Total Principal Est. Rate2 Interest Total Principal Est. Rate Interest Total Total Prin Total Int Total P&I Year 2029 50,000 5.25% 1,027,556 1,077,556 50,000 1,027,556 1,077,556 2029 2030 285,000 5.25% 675,806 960,806 40,000 5.00% 41,000 81,000 325,000 716,806 1,041,806 2030 2031 305,000 5.25% 660,319 965,319 30,000 5.25% 344,138 374,138 55,000 5.00% 28,125 83,125 390,000 1,032,581 1,422,581 2031 2032 425,000 5.25% 641,156 1,066,156 30,000 5.25% 227,588 257,588 55,000 5.00% 25,375 80,375 510,000 894,119 1,404,119 2032 2033 450,000 5.25% 618,188 1,068,188 40,000 5.25% 225,750 265,750 60,000 5.00% 22,500 82,500 550,000 866,438 1,416,438 2033 2034 470,000 5.25% 594,038 1,064,038 50,000 5.25% 223,388 273,388 60,000 5.00% 19,500 79,500 580,000 836,925 1,416,925 2034 2035 500,000 5.25% 568,575 1,068,575 60,000 5.25% 220,500 280,500 65,000 5.00% 16,375 81,375 625,000 805,450 1,430,450 2035 2036 575,000 5.25% 540,356 1,115,356 70,000 5.25% 217,088 287,088 70,000 5.00% 13,000 83,000 715,000 770,444 1,485,444 2036 2037 600,000 5.25% 509,513 1,109,513 80,000 5.25% 213,150 293,150 70,000 5.00% 9,500 79,500 750,000 732,163 1,482,163 2037 2038 685,000 5.25% 475,781 1,160,781 90,000 5.25% 208,688 298,688 75,000 5.00% 5,875 80,875 850,000 690,344 1,540,344 2038 2039 715,000 5.25% 439,031 1,154,031 100,000 5.25% 203,700 303,700 80,000 5.00% 2,000 82,000 895,000 644,731 1,539,731 2039 2040 745,000 5.25% 400,706 1,145,706 120,000 5.25% 197,925 317,925 865,000 598,631 1,463,631 2040 2041 780,000 5.25% 360,675 1,140,675 250,000 5.25% 188,213 438,213 1,030,000 548,888 1,578,888 2041 2042 820,000 5.25% 318,675 1,138,675 280,000 5.25% 174,300 454,300 1,100,000 492,975 1,592,975 2042 2043 855,000 5.25% 274,706 1,129,706 300,000 5.25% 159,075 459,075 1,155,000 433,781 1,588,781 2043 2044 900,000 5.25% 228,638 1,128,638 325,000 5.25% 142,669 467,669 1,225,000 371,306 1,596,306 2044 2045 940,000 5.25% 180,338 1,120,338 360,000 5.25% 124,688 484,688 1,300,000 305,025 1,605,025 2045 2046 985,000 5.25% 129,806 1,114,806 400,000 5.25% 104,738 504,738 1,385,000 234,544 1,619,544 2046 2047 985,000 5.25% 78,094 1,063,094 430,000 5.25% 82,950 512,950 1,415,000 161,044 1,576,044 2047 2048 995,000 5.25% 26,119 1,021,119 450,000 5.25% 59,850 509,850 1,445,000 85,969 1,530,969 2048 2049 455,000 5.25% 36,094 491,094 455,000 36,094 491,094 2049 2050 460,000 5.25% 12,075 472,075 460,000 12,075 472,075 2050 2051 0 0 0 2051 TOTALS 13,065,000 8,748,075 21,813,075 4,380,000 3,366,563 7,746,563 630,000 183,250 813,250 18,075,000 12,297,888 30,372,888 TOTALS $4,380,000$13,065,000 PROPOSED Sewer Utility Debt Service Summary 2028 REVENUE BONDS 2030 REVENUE BONDS 2029 GO NOTESNAME $630,000 14 Sewer Utility Cash Flow Analysis Legend: Increase depicted to maintain with assumed O&M inflation Increase needed above inflationary adjustment Budget 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Revenues Total Revenues from User Rates1 $1,976,830 $2,258,131 $2,371,038 $2,537,010 $2,714,601 $2,904,623 $2,991,762 $3,081,515 $3,081,515 $3,081,515 Percent Increase to User Rates 0.00% 3.00% 5.00% 7.00% 7.00% 7.00% 3.00% 3.00% 0.00% 0.00% Cumulative Percent Rate Increase 0.00% 3.00% 8.15% 15.72% 23.82% 32.49% 36.46% 40.56% 40.56% 40.56% Dollar Amount Increase to Revenues $281,301 $112,907 $165,973 $177,591 $190,022 $87,139 $89,753 $0 $0 Other Revenues Interest Income $70,000 $121,491 $122,614 $145,612 $150,972 $130,208 $153,777 $155,931 $158,444 $160,326 Other Income $516,958 $522,128 $527,349 $532,622 $537,949 $543,328 $548,761 $554,249 $559,791 $565,389 Total Other Revenues $586,958 $643,619 $649,963 $678,234 $688,921 $673,536 $702,538 $710,180 $718,236 $725,715 Total Revenues $2,563,788 $2,901,750 $3,021,001 $3,215,245 $3,403,522 $3,578,159 $3,694,300 $3,791,695 $3,799,751 $3,807,230 Less: Expenses Operating and Maintenance $1,577,103 $1,624,376 $1,673,067 $1,723,217 $1,774,871 $1,828,074 $1,882,872 $1,939,313 $1,997,446 $2,057,323 PILOT Payment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Net Before Debt Service and Capital Expenditures $986,685 $1,277,374 $1,347,934 $1,492,028 $1,628,651 $1,750,085 $1,811,428 $1,852,382 $1,802,304 $1,749,907 Debt Service Existing Debt P&I $283,141 $285,819 $235,096 $235,059 $235,022 $234,985 $234,946 $234,907 $234,867 $234,826 New (2026-2035) Debt Service P&I $0 $0 $0 $1,077,556 $1,041,806 $1,422,581 $1,404,119 $1,416,438 $1,416,925 $1,430,450 Total Debt Service $283,141 $285,819 $235,096 $1,312,616 $1,276,829 $1,657,566 $1,639,065 $1,651,344 $1,651,792 $1,665,276 Transfer In (Out) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Less: Capital Improvements $101,000 $901,700 $12,003,100 $232,000 $1,999,500 $2,587,000 $0 $0 $0 $0 Debt Issued/Grants/Aid $0 $0 $12,730,075 $481,400 ($13,467) $4,380,000 $0 $0 $0 $0 Net Annual Cash Flow $602,544 $89,855 $1,839,814 $428,812 ($1,661,145) $1,885,520 $172,364 $201,038 $150,513 $84,631 Restricted and Unrestricted Cash Balance: Balance at first of year $9,116,751 $9,719,295 $9,809,151 $11,648,965 $12,077,777 $10,416,632 $12,302,152 $12,474,516 $12,675,554 $12,826,066 Net Annual Cash Flow Addition/(subtraction) $602,544 $89,855 $1,839,814 $428,812 ($1,661,145) $1,885,520 $172,364 $201,038 $150,513 $84,631 Balance at end of year $9,719,295 $9,809,151 $11,648,965 $12,077,777 $10,416,632 $12,302,152 $12,474,516 $12,675,554 $12,826,066 $12,910,697 "All-in"Debt Coverage 3.48 4.47 5.73 1.14 1.28 1.06 1.11 1.12 1.09 1.05 Projected 15 Sewer Utility Revenue Debt Coverage Less: Existing Rev Debt Future Rev Debt (2026-2035) Year Total Operating Revenues Transfers In (Out) Total O&M Expense Amount Available for Debt Service Total Total Total Sewer Debt Service Coverage Debt Service Capacity @ 1.1x 2026 2,563,788 0 (1,577,103) 986,685 235,166 235,166 4.20 661,820 2027 2,901,750 0 (1,624,376) 1,277,374 235,131 235,131 5.43 926,118 2028 3,021,001 0 (1,673,067) 1,347,934 235,096 235,096 5.73 990,299 2029 3,215,245 0 (1,723,217) 1,492,028 235,059 1,077,556 1,312,616 1.14 43,773 2030 3,403,522 0 (1,774,871) 1,628,651 235,022 960,806 1,195,829 1.36 284,763 2031 3,578,094 0 (1,828,074) 1,750,020 234,985 1,339,456 1,574,441 1.11 16,486 2032 3,694,234 0 (1,882,872) 1,811,362 234,946 1,323,744 1,558,690 1.16 88,003 2033 3,791,628 0 (1,939,313) 1,852,315 234,907 1,333,938 1,568,844 1.18 115,078 2034 3,799,683 0 (1,997,446) 1,802,236 234,867 1,337,425 1,572,292 1.15 66,105 2035 3,807,161 0 (2,057,323) 1,749,838 234,826 1,349,075 1,583,901 1.10 6,861 16 Sewer Utility Affordability Analysis Year Increase Sewer Vol. Charge3 Sewer User Charge3 Utility Bill (Quarterly) Change Over Prior Year Utility Bill (Annual) Change Over Prior Year % of MHI (79,148) Year 1,000 Gal Gen Service 2025 7.21 46.74 133.26$ 533.04$ 0.67% 2025 2026 0.00% 7.21 46.74 133.26$ -$ 533.04$ -$ 0.67% 2026 2027 3.00% 7.43 48.14 137.26$ 4.00$ 549.03$ 15.99$ 0.69% 2027 2028 5.00% 7.80 50.55 144.12$ 6.86$ 576.48$ 27.45$ 0.73% 2028 2029 7.00% 8.34 54.09 154.21$ 10.09$ 616.84$ 40.35$ 0.78% 2029 2030 7.00% 8.93 57.87 165.00$ 10.79$ 660.02$ 43.18$ 0.83% 2030 2031 7.00% 9.55 61.93 176.55$ 11.55$ 706.22$ 46.20$ 0.89% 2031 2032 3.00% 9.84 63.78 181.85$ 5.30$ 727.40$ 21.19$ 0.92% 2032 2033 3.00% 10.13 65.70 187.31$ 5.46$ 749.22$ 21.82$ 0.95% 2033 2034 0.00% 10.13 65.70 187.31$ -$ 749.22$ -$ 0.95% 2034 2035 0.00% 10.13 65.70 187.31$ -$ 749.22$ -$ 0.95% 2035 Total Change over planning period 54.05$ 216.18$ Notes: 3. The current Sewer volumetric rate is 7.21 per 1,000 gallons and a service charge of 46.74 for 5/8 inch meter. 4. The usage is assumed to be 12,000 Gallons per quarter. Sewer 17 • 2028 Biosolids Handling Facility is currently structured at a market rate 20 - year revenue bond. ✓ Project could qualify for a Clean Water Fund Loan, which could reduce overall interest rate and lengthen the repayment terms to 30 years. This could reduce the overall rate increases due to this project. • Revenue adjustments achieve required debt service coverage but also bolsters cash position of the utility. This could be used to cash fund additional projects or buy - down what is borrowed for projects. • We’ve spread rate increases out to minimize annual impact on the ratepayers – alternative (larger) rate increase structure could be implemented on the front end to eliminate rate increases in the down - years. Sewer Utility Capital Project Considerations 18 Questions? 19 Important Disclosures Ehlers is the joint marketing name of the following affiliated businesses (collectively, the “Affiliates”): Ehlers & Associat es, Inc. (“EA”), a municipal advisor registered with the Municipal Securities Rulemaking Board (“MSRB”) and the Securities and Exchange Commission (“SEC”); Ehlers Investment Partners, LLC (“EIP”), an SEC registered investment adviser; and Bond Trust Services Corporation (“BTS”), a holder of a limited banking charter issued by the State of Minnesota. 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