City utilities staff presented the electric, gas, water and sewer budgets at the July work session and said the draft does not request rate increases beyond those already encoded in existing ordinances. Staff said utilities face heavy capital needs — including developer-driven work and regulatory projects — but are aiming to avoid additional rate hikes this cycle.

Derek, identified in the meeting as a utilities presenter, told the council, "The place that probably more of the focus needs to be on is what we can do with capital." He said the city has been using cash reserves to fund recent infrastructure and expects to pursue a measured capital program to stabilize rates.

Key utility points disclosed in the session:
- Electric: Staff showed a roughly $14 million electric capital program and said about $15 million of capacity exists in current rates for capital before new rate requests would be necessary. The presentation included a $300,000 line in the draft for “generation considerations” so staff can evaluate options if coal-fired generation must be retired under pending federal rules.
- Generation planning: Staff described options including converting an existing unit to natural gas, evaluating new generation sites (including near the landfill and energy center), solar plus battery storage, and longer-term technologies such as small modular reactors. Staff emphasized planning rather than committing to an expensive project this budget cycle.
- Gas: The gas budget includes an ongoing cost-of-service increase already in ordinance (6.3% in a later year); staff noted a roughly $2 million shortfall had been covered previously from cash when market gas prices spiked and that the utility uses a PGA (purchase gas adjustment) to pass commodity-price differences through to customers.
- Water and sewer: Staff described the aquifer-storage-and-recovery (ASR) program and the ongoing regulatory drivers for water projects (nitrates, potential uranium concerns) and said ASR costs are significant (roughly $1–2 million annually run‑rate in presentation). Sewer capital was shown at a little over $2 million, including generator replacement and collection work tied to the Highway 6 project.

Staff repeatedly said current ordinances include future rate steps for certain utilities (electric, gas, water) and that, "there will be no additional rate increases on top of what’s already existing in the ordinances," as stated by a utilities presenter. The presenters emphasized the city’s target cash-on-hand for utilities remains 50% (approximately 180 days).

Discussion vs. decisions: the session was a review and planning discussion. Council was not asked to adopt rate changes at the meeting; staff said they would return with additional detail, including fee schedule language and any ordinance drafts needed for council consideration.

Staff also described developer-driven capital: developer projects currently in the budget total roughly $14 million, with $9.5 million tied to the Hastings Southeast (Highway 6) project; staff said roughly 80% of that developer cost is expected to be reimbursed. The utilities advisory board and staff are preparing an ordinance for a revised line‑extension policy tied to consistency with peer utilities.

The council asked questions about wholesale electricity markets, the city’s ability to sell capacity, and an economic-development cash balance that utilities set aside in earlier years (staff said roughly $2 million remains reserved for economic development under an earlier Board of Public Works decision).