Page 232 - GFOA Draft 2

CITY OF SAGINAW
DRAINAGE UTILITY FUND
OVERVIEW OF REVENUES AND EXPENDITURES
2022-2023

The City established a drainage utility district on January 4, 2005. Fees are assessed on properties based on the amount
of storm water runoff they produce. Single family residences are assessed a uniform base fee of $5.00 per month.
Residential rates were increased from $3.00 to $4.00 per month during the FY 12/13 budget process and from $4.00 to
$5.00 during the FY 16/17 budget process. On November 1, 2022 the new residential rate will be increased to $6.00. Other
properties, including multi-family, commercial, and industrial, produce more storm water runoff at a higher rate and are
charged a fee based on the number of equivalent base (residential) units adjusted for the use and size of the property. The
rate increase will enable the City to address drainage issues by funding future capital projects with cash reserves.

A drainage utility is used by cities throughout the State to fund drainage projects. It is similar to water and wastewater
utilities in that users of the drainage system pay a monthly fee to pay for the system’s operation. Every piece of property in
the city contributes storm water runoff that must be collected, routed and monitored to protect the public’s health and
safety from loss of life or property damage caused by ooding, stagnation and non-point source pollution.

The City needed a drainage utility to offset the growing cost of operating the storm drainage system. These costs include
maintenance of the existing system, federal mandates to control storm water runoff, oodplain management and planning
and construction of new drainage facilities.

The City hired maintenance personnel and purchased equipment (dump truck, brush chipper and Gradall) to focus on
maintaining the existing drainage infrastructure. An Environmental Manager and Environmental Technician were hired to
oversee the city's MS4 permit compliance and other federally mandated programs as well as sampling, industrial
pretreatment program, site inspections and the cross-connection control program. One-half of the salary of these positions
are paid from the drainage utility and the other half from the water and wastewater department. Remaining funds will be
used for easement acquisition and design of major drainage systems. Future funds may be used to partially pay for debt
issued to nance major construction projects.

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