City utilities staff presented the advisory board with a detailed inventory of critical water and sewer system priorities and proposed next steps that would combine smaller in-house repairs with phased capital projects and targeted funding strategies.

The staff presentation identified three near-term wastewater problems: high inflow-and-infiltration (I&I) driven by root intrusion, illegal lateral connections and failed service taps; several undersized lift stations and force mains (including a lift station with a 6-inch force main and related capacity problems); and aging clay and undersized gravity mains in older neighborhoods. Staff said I&I events recently drove unusually high quarterly wastewater charges from the regional treatment provider and increased vacuum-truck costs.

On the water side, staff highlighted a shortage of system storage relative to daily demand and multiple sections of 2-inch galvanized pipe and asbestos-cement pipe that are functionally obsolete. Staff noted a recent DNR water-loss benchmark showing about 32% system loss in a prior reporting period and said older meters and small-diameter lines are major contributors to unaccounted-for water.

Solutions staff proposed include a near-term campaign of focused I&I repairs and lateral incentives for private-side repairs, targeted upsizing of critical force mains and connecting one local lift station ("B") directly into the main 94 corridor to relieve a double-handling bottleneck, a multi-year program to replace short stretches of 2-inch galvanized lines (staff framed a rough, system-level replacement estimate in the low hundreds of thousands of dollars for multiple small projects), and a plan to add isolation valves and hydrants as budget allows.

Funding and rates: staff reiterated that the council's recently adopted rate plan included ongoing reviews and that staff will return to the advisory board with a status update showing reserve targets and whether the current pace of capital work is meeting projections. Staff said the city can phase work, pursue grants (EPA/USDA/DNR programs were discussed in general terms), and consider modest, scheduled rate adjustments and smaller bonding options to finance larger projects.

Operations and equipment: staff listed in-house equipment and a prioritized wish list for acquisition (jetters, backhoes, a crack seal machine already budgeted, and other items). Managers said augmenting in-house capabilities reduces unit cost for many pipe repairs and will increase the number of small projects the city can complete without external contractors.

Board response: members pressed for a timeline tying specific projects to rate plan checkpoints. Several members urged staff to show concrete reserve and cash-flow numbers at the next meeting. Staff said they will prepare that analysis and recommended the board continue to favor a phased, prioritized approach rather than a single large bond issue that would carry higher short-term rate impacts.