regular meeting of the utilities commission...

REGULAR MEETING OF THE

UTILITIES COMMISSION

October 13, 2015, 3:30 P.M.

Utilities Conference Room

13069 Orono Parkway, P.O. Box 430, Elk River, MN 55330-0430

763.441.2020 www.elkriverutilities.com @ERMU_MN

AGENDA

1.0 CALL MEETING TO ORDER

1.1 Pledge of Allegiance

1.2 Consider the Agenda

1.3 Recognition of Company Achievement

a. Resource Training & Solutions Well Workplace Award - Angela Hauge and Michelle Martindale

2.0 CONSENT AGENDA (Routine or noncontroversial items. Approved by one motion.)

2.1 Check Register

2.2 Previous Meeting Minutes

2.3 Financial Statements

3.0 OPEN FORUM (Non agenda items for discussion. No action taken during this meeting.)

4.0 OLD BUSINESS

4.1 Electric Service Territory Update

4.2 Payment in Lieu of Taxes (PILOT) and Other Donations to the City of Elk River

4.3 Expansion of the Elk River Municipal Utilities Board of Commissioners

4.4 Environmental Protection Agency Rules affecting ERMU’s Diesel Generation Facility

5.0 NEW BUSINESS

5.1 2016 Budget: Water & Electric Expenses

5.2 2016 ERMU Fee Schedule

5.3 Performance Metrics and Incentive Compensation Policy 3rd Quarter Score Card Update

6.0 OTHER BUSINESS

6.1 Staff Updates

6.2 Set Date for Next Meeting

6.3 Closing of Meeting: “Meeting to be Closed pursuant to MN Statute

13D.05, Subd. 3(c)(3) to develop or consider offers or counteroffers

for the purchase or sale of real or personal property.”

a Call Closed Session to Order

b Discussion

c Adjourn Closed Session

6.4 Adjourn Regular Meeting

http://www.elkriverutilities.com/

https://twitter.com/ERMU_MN

Payroll/LaborCheck Register Totals

Page: 110/02/2015 1:10:58 pm

Elk River Municipal Utilities

Pay Date: 09/11/2015 To 09/11/2015

Revision: 74512

Pays Job Amount Hours92,247.63 2,738.752 Reg Hrly5,937.54 119.003 Overtime

0.00 0.004 Double Time1,714.40 48.085 On-Call/Stand-by

81.59 0.0024 FLSA89.41 2.5025 Rest Time

752.03 18.5010 Bonus Pay450.00 0.0018 Commissioner Reimb.

0.00 0.00104 Commission Stipend0.00 0.00105 Perf. Metr. Distr.

6,959.30 180.83VAC Vacation Pay3,051.35 88.92SICK Sick Pay

11,466.60 336.00HOL Holiday Pay0.00 0.00HALF Half Vacation Pay0.00 0.001/2S Half Sick Pay

994.67 18.255-2 On-Call/Stand-by/OT22.58 0.0011 Bonus $

631.44 16.00PTO Personal Day0.00 0.001/2P Half Personal Day

Pay Total: 124,398.54 3,566.83

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Payroll/LaborCheck Register Totals

Page: 110/02/2015 1:13:02 pm


Pay Date: 09/25/2015 To 09/25/2015

Revision: 74512

Pays Job Amount Hours104,642.38 3,049.952 Reg Hrly

696.32 13.003 Overtime533.04 8.004 Double Time

1,762.76 48.085 On-Call/Stand-by46.59 0.0024 FLSA0.00 0.0025 Rest Time0.00 0.0010 Bonus Pay0.00 0.00105 Perf. Metr. Distr.

5,243.17 153.98VAC Vacation Pay3,748.49 123.30SICK Sick Pay

0.00 0.00HOL Holiday Pay171.76 8.00HALF Half Vacation Pay48.39 1.501/2S Half Sick Pay

503.34 8.505-2 On-Call/Stand-by/OT0.00 0.0011 Bonus $

1,002.00 32.00PTO Personal Day0.00 0.001/2P Half Personal Day

Pay Total: 118,398.24 3,446.31

/pro/rpttemplate/acct/2.33.1/pl/PL_CHK_REG_TOTALS.xml.rpt KGreenberg25252032

CHECK REGISTER

September, 2015

APPROVED BY:

JOHN J. DIETZ

DARYL THOMPSON

ALLAN E. NADEAU

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Accounts PayableCheck Register


09/01/2015 To 09/30/2015Bank Account: 1 - ELECTRIC/GENERAL FUND

Check /Tran Date

PmtType AmountVendor NameVendor Reference

WIRE1029 09/02/2015 154 MINNESOTA REVENUE (ELECTRONIC) 4,095.88PAYROLL TAXES MN STATE618.70PAYROLL TAXES MN STATE

Total for Check/Tran - 1029: 4,714.58

WIRE1030 09/02/2015 152 IRS - USA TAX PMT (ELECTRONIC) 10,190.12PAYROLL TAXES FED & FICA - 8/24/201514,820.14PAYROLL TAXES FED & FICA - 8/24/20151,738.46PAYROLL TAXES FED & FICA - 8/24/20151,846.02PAYROLL TAXES FED & FICA - 8/24/2015


WIRE1040 09/02/2015 9999 LEANN CHIN 82.01NISC LUNCH20.50NISC LUNCH

Total for Check/Tran - 1040: 102.51

WIRE1041 09/02/2015 9999 PIZZA MAN 51.28NISC LUNCH12.82NISC LUNCH


WIRE1042 09/02/2015 9999 MN ELECTRIC METER SCHOOL - PAYPA 325.002015 ELECTRIC METER SCHOOL

WIRE1043 09/02/2015 9999 MN ELECTRIC METER SCHOOL 325.00ELECTRIC METER SCHOOL

WIRE1044 09/02/2015 9999 LANGFORD TOOL & DRILL 93.60EPOXY

WIRE1045 09/03/2015 9999 POMPEII PIZZERIA 76.62NISC LUNCH19.15NISC LUNCH


WIRE1047 09/08/2015 9999 123 SIGNUP 40.00APA MEMBERSHIP10.00APA MEMBERSHIP


WIRE1049 09/08/2015 7463 SELECTACCOUNT 120.00FSA CLAIM REIMBURSEMENTS

WIRE1050 09/16/2015 152 IRS - USA TAX PMT (ELECTRONIC) 10,785.05PAYROLL TAXES FED & FICA - 9/11/201515,579.40PAYROLL TAXES FED & FICA - 9/11/20151,787.01PAYROLL TAXES FED & FICA - 9/11/20151,820.78PAYROLL TAXES FED & FICA - 9/11/2015


WIRE1051 09/16/2015 154 MINNESOTA REVENUE (ELECTRONIC) 4,336.33PAYROLL TAXES MN STATE - 9/11/2015620.86PAYROLL TAXES MN STATE - 9/11/2015


/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt252034

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Check /Tran Date


WIRE1052 09/11/2015 153 PERA (ELECTRONIC) 15,600.11PERA CONTRIBUTIONS - 9/11/20151,752.70PERA CONTRIBUTIONS - 9/11/2015


WIRE1054 09/11/2015 7463 SELECTACCOUNT 1,474.43HSA CONTRIBUTIONS - 9/11/201575.00HSA CONTRIBUTIONS - 9/11/2015


WIRE1055 09/11/2015 161 MNDCP (ELECTRONIC) 2,500.00MNDCP EPLOYEE CONTRIBUTIONS- 9/11/2227.00MNDCP EPLOYEE CONTRIBUTIONS- 9/11/2


WIRE1056 09/11/2015 160 HCSP (ELECTRONIC) 1,705.88HCSP EMPLOYEE CONTRIBUTIONS- 9/11/2125.19HCSP EMPLOYEE CONTRIBUTIONS- 9/11/2


WIRE1057 09/11/2015 158 VOYA (ELECTRONIC FOR W&A DC PLA 1,734.28DEFERRED COMP CONTRIBUTIONS W&A -

WIRE1058 09/08/2015 9999 APA - NORTHSTAR CHAPTER 40.00APA MEMBERSHIP10.00APA MEMBERSHIP



WIRE1060 09/14/2015 9999 RADISSON HOTEL - ROSEVILLE 438.30LODGING FOR ELEC METER SCHOOL

WIRE1061 09/14/2015 9999 RADISSON HOTEL - ROSEVILLE 438.30LODGING ELEC METER SCHOOL

WIRE1062 09/11/2015 9999 THE CUSTOMER SERVICE GROUP 62.12SUPPLIES FOR CUSTOMER SERVICE WEEK15.53SUPPLIES FOR CUSTOMER SERVICE WEEK


WIRE1063 09/09/2015 9999 GROEBNER 374.06FUSING MACHINE - WACO

WIRE1064 09/08/2015 9999 A-Z RESTAURANT EQUIP 881.70COFFEE MACHINE

WIRE1065 09/18/2015 174 MINNESOTA REVENUE SALES TX (ELE 178,179.44SALES AND USE TAX - AUGUST8,521.56SALES AND USE TAX - AUGUST


WIRE1067 09/02/2015 7463 SELECTACCOUNT 50.64ADMIN FEES12.66ADMIN FEES


WIRE1068 09/17/2015 9999 OLD CHICAGO 32.65TRAVEL EXPENSE/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt25203

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Check /Tran Date


WIRE1069 09/17/2015 9999 COMFORT SUITES 789.84TRAVEL EXPENSE AWWA

WIRE1070 09/22/2015 7463 SELECTACCOUNT 20.00CLAIM REIMBURSEMENT

WIRE1071 09/17/2015 9999 RAMADA MARSHALL 429.60HOTEL FOR OVERHEAD SCHOOL




WIRE1075 09/14/2015 9999 SHOW ME CABLES 14.93POWER SUPPLY EXTENSION CABLE

WIRE1076 09/15/2015 9999 SCHWEITZER ENGINEERING LABS 387.00TRANSCEIVER

WIRE1077 09/21/2015 3401 UNITED STATES TREASURY 1,295.40PENALTIES FOR LATE TAX DEPOSITS323.85PENALTIES FOR LATE TAX DEPOSITS



WIRE1079 09/24/2015 158 VOYA (ELECTRONIC FOR W&A DC PLA 1,756.77DEFERRED COMP CONTRIBUTIONS W&A-

WIRE1080 09/28/2015 160 HCSP (ELECTRONIC) 1,618.55HCSP EMPLOYEE CONTRIBUTIONS-092820117.95HCSP EMPLOYEE CONTRIBUTIONS-092820


WIRE1081 09/28/2015 161 MNDCP (ELECTRONIC) 2,500.00MNDCP EPLOYEE CONTRIBUTIONS-092820227.00MNDCP EPLOYEE CONTRIBUTIONS-092820


WIRE1082 09/28/2015 7463 SELECTACCOUNT 1,474.43HSA CONTRIBUTIONS - 0928201575.00HSA CONTRIBUTIONS - 09282015


WIRE1083 09/25/2015 153 PERA (ELECTRONIC) 14,924.47PERA CONTRIBUTIONS1,651.32PERA CONTRIBUTIONS


WIRE1084 09/25/2015 9999 FOXIT PDF EDITOR 85.44PDF EDITOR21.36PDF EDITOR




/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


WIRE1086 09/30/2015 152 IRS - USA TAX PMT (ELECTRONIC) 10,143.82PAYROLL TAXES FED & FICA - 0930201514,801.36PAYROLL TAXES FED & FICA - 093020151,621.49PAYROLL TAXES FED & FICA - 093020151,712.64PAYROLL TAXES FED & FICA - 09302015


WIRE1088 09/27/2015 9999 DELTA AIRLINES 20.00MIC - BAG CHECK5.00MIC - BAG CHECK






WIRE1091 09/27/2015 9999 ST LOUIS TAXI COMPANY 40.90MIC - TAXI FROM AIRPORT10.22MIC - TAXI FROM AIRPORT


WIRE1092 09/28/2015 9999 PAPPY'S SMOKEHOUSE 51.10MIC - 92815 DINNER12.77MIC - 92815 DINNER


WIRE1093 09/28/2015 9999 HYATT STARBUCKS 9.34MIC - STARBUCKS2.34MIC - STARBUCKS


WIRE1094 09/30/2015 9999 BUDWEISER BREWHOUSE 50.69MIC - 93015 DINNER12.67MIC - 93015 DINNER


WIRE1095 09/30/2015 9999 ST LOUIS AIRPORT TAXI 39.33MIC - TAXI TO AIRPORT9.83MIC - TAXI TO AIRPORT





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Check /Tran Date








WIRE1100 09/30/2015 9999 PARK MSP 57.60MIC - AIRPORT PARKING14.40MIC - AIRPORT PARKING


CHK69197 09/01/2015 229 SHERBURNE COUNTY ZONING 100.00COUNTY ROAD 1 PERMIT

CHK69198 09/02/2015 229 SHERBURNE COUNTY ZONING 100.0011337 BROOK RD PERMIT

CHK69199 09/03/2015 150 ALARM PRODUCTS DIST, INC 473.20SECURITY PRODUCTS159.61Rare Earth Mags


CHK69200 09/03/2015 4531 AT & T MOBILITY 1,213.20MOBILE PHONES303.30MOBILE PHONES


CHK69201 09/03/2015 96 BASIN ELECTRIC POWER COOPERATIV 47.88VPN SERVICE FOR IVUE11.97VPN SERVICE FOR IVUE


CHK69202 09/03/2015 2920 BATTERIES PLUS BULBS 60.94BATTERIES

CHK69203 09/03/2015 8552 BECK LAW OFFICE 832.20ATTORNEY BILLING208.05ATTORNEY BILLING


CHK69204 09/03/2015 9 BORDER STATES ELECTRIC SUPPLY 137.69GLOVES

CHK69205 09/03/2015 180 CENTER CUT MEATS 810.00EVENT GRATUITY

CHK69206 09/03/2015 11 CITY OF ELK RIVER 63.68PARTS & LABOR FOR UNIT #13127.81PARTS & LABOR FOR UNIT #43


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Check /Tran Date


52.25PARTS & LABOR FOR UNIT #1137.55PARTS & LABOR FOR UNIT #457.56PARTS & LABOR FOR UNIT #20

1,059.33PARTS & LABOR FOR UNIT #33264.83PARTS & LABOR FOR UNIT #3351.66PARTS & LABOR FOR UNIT #14

105.01PARTS & LABOR FOR UNIT #1826.25PARTS & LABOR FOR UNIT #18

160.90Truck decals160.10100 Year Anniversary parade banner


CHK69207 09/03/2015 151 CONNEXUS ENERGY 46.69MO. STATEMENT

CHK69208 09/03/2015 2404 CORNERSTONE FORD 30,672.82Ford F250

CHK69209 09/03/2015 3599 JOHN DIETZ 14.91HOG's Trophy Presentation - Rockwood's

CHK69210 09/03/2015 23 ELK RIVER MUNICIPAL UTILITIES 3,025.250701 TO 08012015 STMT48.100701 TO 08012015 STMT

300.620701 TO 08012015 STMT2,224.570701 TO 08012015 STMT

19,180.800701 TO 08012015 STMT412.500701 TO 08012015 STMT


CHK69211 09/03/2015 122 ELK RIVER WINLECTRIC CO 179.76GARY ST TOWER LEVITON19.45Conduit straps


CHK69212 09/03/2015 8247 FERGUSON WATERWORKS #2516 1,140.68HYDRANT PAINT AND OIL

CHK69213 09/03/2015 28 G & K SERVICES SERVICES 100.66RUGS & TOWELS25.17RUGS & TOWELS


CHK69214 09/03/2015 80 GRAINGER 156.10VALVE

CHK69215 09/03/2015 5118 GRAND RENTAL STATION 87.49COTTON CANDY MACHINE - 100TH ANNIV

CHK69216 09/03/2015 809 HAWKINS, INC. 1,926.40CHEM

CHK69217 09/03/2015 6836 INNOVATIVE OFFICE SOLUTIONS, LLC 23.52Office supplies5.88Office supplies


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Check /Tran Date


16.41OFFICE SUPPLIES4.10OFFICE SUPPLIES


CHK69218 09/03/2015 8083 JT SERVICES 17,484.0023' Fiberglass Poles & 30' Fiberglass Po

CHK69219 09/03/2015 185 MCR PERFORMANCE SOLUTIONS 22,075.45MISO CONSULTATION

CHK69220 09/03/2015 194 METRO TENT RENTAL 561.09EVENT TENT RENTAL

CHK69221 09/03/2015 16 MINNESOTA DEPT OF HEALTH 7,587.48QTRLY SERVICE CONNECTIONS

CHK69222 09/03/2015 573 NCPERS MINNESOTA 192.00LIFE INSURANCE

CHK69223 09/03/2015 8606 NEOPOST USA INC. 1,146.55LETTER OPENER286.64LETTER OPENER


CHK69224 09/03/2015 450 RUSSELL SECURITY RESOURCE INC. 396.12Service shop door, install new lock/keys

CHK69225 09/03/2015 20 SLACK PAINTING 6,000.00AUBURN WATER TOWER WATERBLAST

CHK69226 09/03/2015 6107 STUART C. IRBY CO. 103.42GLOVES AND GLOVE REPAIR KITS

CHK69227 09/03/2015 8948 TRYCO LEASING INC. 112.19toshiba28.05toshiba


CHK69228 09/03/2015 55 WESCO RECEIVABLES CORP. 702.96Cold Shrink Splice Jacket1,028.85Loadbreak Connectors


CHK69229 09/03/2015 189 GARY WESTERLUND 1.00GRANT EASEMENT 71-131-2438

CHK69230 09/03/2015 8046 WHOLE ENERGY & HARDWARE 5,690.00CONSERVATION IMPROVEMENT PROG PU

CHK69231 09/03/2015 1074 WINDSTREAM 350.01OFFICE TELEPHONE87.50OFFICE TELEPHONE


CHK69232 09/03/2015 8213 ZIMMERMAN TODAY 148.00SEPT ADS

CHK69233 09/03/2015 229 SHERBURNE COUNTY ZONING 100.00CTY RD 12 CONNEXUS TAKEOVER

CHK69234 09/03/2015 3599 JOHN DIETZ 107.65MMUA SUMMER MTG26.91MMUA SUMMER MTG

Total for Check/Tran - 69234: 134.56/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt25203

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Check /Tran Date


CHK69235 09/03/2015 5987 DARYL THOMPSON 107.65MMUA SUMMER MTG26.91MMUA SUMMER MTG


CHK69236 09/03/2015 685 ADI -920.00GSM Rebate685.67security products398.74Wireless Glassbreaks

2,335.55Security System PartsTotal for Check/Tran - 69236: 2,499.96

CHK69237 09/03/2015 198 AMERICAN PUBLIC WORKS ASSOCIATI 495.00UTILITIES INSPECTOR SCHOOL

CHK69238 09/03/2015 2920 BATTERIES PLUS BULBS 15.86BATTERIES FOR SECURITY50.23BATTERIES FOR SECURITY


CHK69239 09/03/2015 9 BORDER STATES ELECTRIC SUPPLY 562.10#1 Crimp279.61Cold Shrink Splice


CHK69240 09/03/2015 428 BOYER TRUCKS 751.46BUCKET TRUCK #4 REPAIR

CHK69241 09/03/2015 36 CROW RIVER FARM EQUIP CO 268.45COVER HOLES IN POWER PLANT

CHK69242 09/03/2015 9192 CUB FOODS ELK RIVER 6.21COOKIES - COMM MTG1.55COOKIES - COMM MTG


CHK69243 09/03/2015 212 DAKOTA SUPPLY GROUP 31.50Shackle Keys348.60Shackle Locks468.00Utilco covers & connectors


CHK69244 09/03/2015 9354 DIRECT PORTABLE TOILET SERVICES L 80.34RIVER TOILET SERVICE

CHK69245 09/03/2015 197 ECOVA, INC 1,116.50ROOFTOP UNIT REPLACEMENT

CHK69246 09/03/2015 8840 ELITE MEDIA DESIGN OF ELK RIVER 59.60MONTHLY HOSTING OF WEBSITE59.60MONTHLY HOSTING OF WEBSITE29.80MONTHLY HOSTING OF WEBSITE


CHK69247 09/03/2015 122 ELK RIVER WINLECTRIC CO 22.71DIAG CUT PLIERS


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Check /Tran Date


CHK69248 09/03/2015 9997 FIELD ASSET SERVICES LLC 150.03DEP To AP

CHK69249 09/03/2015 8949 FS3 INC. 91.21Headband Ear Plugs

CHK69250 09/03/2015 308 HASSAN SAND & GRAVEL 182.38TOPSOIL

CHK69251 09/03/2015 6836 INNOVATIVE OFFICE SOLUTIONS, LLC 41.61OFFICE SUPPLIES2.88OFFICE SUPPLIES

32.58ENVELOPES FOR HISTORY BOOKSTotal for Check/Tran - 69251: 77.07

CHK69252 09/03/2015 8083 JT SERVICES 284.72Splice Cleaner Polywater

CHK69253 09/03/2015 167 KODET ARCHITECTUAL GROUP LTD 8,572.50ARCHITECTURAL FEE

CHK69254 09/03/2015 417 LOCATORS & SUPPLIES INC. 73.77QUIET BANDS

CHK69255 09/03/2015 188 MARTIES FARM SERVICE INC 81.61ROUND-UP54.5125# SPECIAL


CHK69256 09/03/2015 145 MENARDS 6.56CONCRETE MIX99.85TOOLS & SUPPLIES7.12CLAMPS

94.61SUPPLIES72.49BROOM & CHALK8.95DRILL BIT

100.69SUPPLIES61.59BOLTS

1,502.24CEILING TILE16.69SHELVES & SUPPLIES

143.74SHELVES & SUPPLIES19.88TOOLS22.73TOOLS24.15HYDRANT SUPPLIES29.74SHOP SUPPLIES16.08BOLTS & THERMOMETER9.03TEE & PLUG5.86SHOP SUPPLIES

13.87SCREWS13.49COUPLERS & BUSHINGS99.20SHOP SUPPLIES7.02TOWER SUPPLIES


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Check /Tran Date


78.11CAKE STAND45.15TOOLS & SUPPLIES13.38TOWER SUPPLIES3.26TOWER SUPPLIES

50.92PLANT SUPPLIES44.79PLANT SUPPLIES31.37HYDRANT SUPPLIES

5,105.00CFL REBATES51.99PLANT SUPPLIES


CHK69257 09/03/2015 120 NAPA AUTO PARTS 4.70TRUCK #16 SMALL BULB52.37FUSE & FUSE HOLDER


CHK69258 09/03/2015 186 MIKE O'NEILL 136.80MMUA SUMMER MTG

CHK69259 09/03/2015 106 PERFECTION PLUS, INC. 472.01CONTRACT CLEANING118.00CONTRACT CLEANING


CHK69260 09/03/2015 45 PETTY CASH 100.00ADD'L CASH FOR DRAWERS

CHK69261 09/03/2015 5056 PLAISTED COMPANIES, INC. 190.64CLASS 5 GRAVEL & BLACK DIRT78.02CLASS 5 GRAVEL & BLACK DIRT


CHK69262 09/03/2015 71 PRINCIPAL LIFE INSURANCE CO GRAN 4,330.30DENTAL, LIFE & LTD INSURANCE - SEPT 21,183.48DENTAL, LIFE & LTD INSURANCE - SEPT 21,082.58DENTAL, LIFE & LTD INSURANCE - SEPT 2


CHK69263 09/03/2015 32 R&H PAINTING LLC 16,592.0034 Light Poles Painted

CHK69264 09/03/2015 128 RANDY'S SANITATION, INC. 1,019.00WASTE REMOVAL34.28DOC DESTRUCTION0.35DOC DESTRUCTION


CHK69265 09/03/2015 3218 RDO EQUIPMENT 156.56Collar for Drill299.73Drill Statrer Rod181.28Grease for Drill


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Check /Tran Date


634.20Tru-Bore Mud for DrillTotal for Check/Tran - 69265: 1,271.77

CHK69266 09/03/2015 196 REFRIGERATION SERVICES 127.50DIAGNOSE DEHUMIDIFIER

CHK69267 09/03/2015 566 RIKE-LEE ELECTRIC INC. 3,066.86RIVER RANCH REBUILD METERS/SOCKET

CHK69268 09/03/2015 7972 TOM SAGSTETTER 129.95MMUA SUMMER MTG

CHK69269 09/03/2015 159 SHORT ELLIOTT HENDRICKSON INC. 868.00ELKMU WTP EVAL

CHK69270 09/03/2015 8377 SPRINT 34.99MOBILE PHONES378.94MOBILE PHONES77.97MOBILE PHONES


CHK69271 09/03/2015 90 TOTAL TOOL 59.855 sided socket79.30Ratcheting Wrench


CHK69272 09/03/2015 135 WATER LABORATORIES INC 375.00WATER TESTING

CHK69273 09/03/2015 8214 WELCOME WAGON 157.50SECURITY ADVERTISING

CHK69274 09/03/2015 55 WESCO RECEIVABLES CORP. 237.30Copper/Aluminum Connectors384.40Cold Shrink Termination Kit


CHK69275 09/03/2015 610 WRIGHT HENNEPIN INT'L RESPONSE C 4,553.70MONTHLY MONITORING

CHK69276 09/17/2015 1327 AUTOMATIC SYSTEMS CO 1,171.10ANTENNA TROUBLESHOOTING

CHK69277 09/17/2015 6 BEAUDRY OIL COMPANY 134.48TERRACAIR DEF

CHK69278 09/17/2015 6138 BLUE EGG BAKERY 4.80COOKIES FOR MEETINGS1.20COOKIES FOR MEETINGS


CHK69279 09/17/2015 9 BORDER STATES ELECTRIC SUPPLY 136,543.93Wire1,320.00320 Meters

302.27Meter seals3,331.77UG Fsult Indicators

119.01Scoring BladesTotal for Check/Tran - 69279: 141,616.98

CHK69280 09/17/2015 4477 CARTRIDGE WORLD 290.66TONER/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt25203

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Check /Tran Date


72.66TONERTotal for Check/Tran - 69280: 363.32

CHK69281 09/17/2015 11 CITY OF ELK RIVER 613.59PATCH MIX2,296.23JULY FUEL

430.27JULY FUEL903.71JULY FUEL124.88EVENT SIGNAGE195.22EVENT SIGNAGE - BOOTHS61.64EVENT SIGNAGE - BAND SHELL

467.73EVENT NO PARKING SIGNTotal for Check/Tran - 69281: 5,093.27

CHK69282 09/17/2015 76 CONNEXUS ENERGY -1,167.86PURCHASED POWER & SUBSTATION CRE2,377,937.68PURCHASED POWER & SUBSTATION CRE

Total for Check/Tran - 69282: 2,376,769.82

CHK69283 09/17/2015 36 CROW RIVER FARM EQUIP CO 87.05TOOLS - CLEVIS

CHK69284 09/17/2015 73 CUB FOODS 4.00LIGHTING COUPON REBATES

CHK69285 09/17/2015 9192 CUB FOODS ELK RIVER 116.90COFFEE/SUPPLIES7.25OFFICE SUPPLIES


CHK69286 09/17/2015 212 DAKOTA SUPPLY GROUP 1,442.81Uticom Danger Tags750.27Fault Indicator Labels750.26Fuse Pad Labels


CHK69287 09/17/2015 3145 DLT SOLUTIONS, LLC 1,270.86AUTODESK RENEWAL317.72AUTODESK RENEWAL


CHK69288 09/17/2015 2367 ELECTRO INDUSTRIES INC 2,969.44Comverge Upgrade-191.02Credit for sales tax on Inv. AR-105695


CHK69289 09/17/2015 19 ELK RIVER AREA CHAMBER OF COMM 372.00MEMBERSHIP INVESTMENT93.00MEMBERSHIP INVESTMENT



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Check /Tran Date


CHK69290 09/17/2015 24 ELK RIVER PRINTING 287.49SERVICE AGREE FORMS

CHK69291 09/17/2015 8709 FAIRVIEW DIAGNOSTIC LABORATORIE 34.40PRE-EMPLOYMENT DRUG TEST8.60PRE-EMPLOYMENT DRUG TEST


CHK69292 09/17/2015 28 G & K SERVICES SERVICES 100.66MATS & TOWELS25.17MATS & TOWELS


CHK69293 09/17/2015 80 GRAINGER 788.80Remote Mount Electric Actuators

CHK69294 09/17/2015 2401 HOME DEPOT (STORE #2821) 319.00LIGHTING COUPON REBATE



CHK69296 09/17/2015 144 J&W INSTRUMENTS, INC 2,324.58engine sensor for plant

CHK69297 09/17/2015 3795 MICHELLE MARTINDALE 142.69HEALTH FAIR PRIZES

CHK69298 09/17/2015 9273 METERING & TECHNOLOGY SOLUTION 935.16FIRE HYDRANT W/ GATE VALVE159.00CHAMBERS & ERTs240.00CHAMBERS & ERTs


CHK69299 09/17/2015 119 MINNESOTA COMPUTER SYSTEMS INC 232.54CONTRACTS & COPIES FOR COPIERS58.13CONTRACTS & COPIES FOR COPIERS


CHK69300 09/17/2015 3321 NORTHSTAR CHAPTER - APA 240.00TRAINING60.00TRAINING


CHK69301 09/17/2015 3218 RDO EQUIPMENT 135.56Teeth For Drill Head641.58True-Bore For Drill362.54Adaptor for drill128.68Collar for Drill


CHK69302 09/17/2015 227 SHOE MENDERS & SADDLERY 177.65SAFETY BOOTS - VOLK185.00WORK BOOTS - STOECKEL


16

/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69303 09/17/2015 3249 THERESA SLOMINSKI 37.15CCOGA MTG9.29CCOGA MTG


CHK69304 09/17/2015 8141 SPEEDCUTTERS OUTDOOR MAINTENA 100.00LAWN MAINTENANCE40.00LAWN MAINTENANCE

1,087.99LAWN MAINTENANCETotal for Check/Tran - 69304: 1,227.99

CHK69305 09/17/2015 9191 UPS 14.86SHIPPING

CHK69306 09/17/2015 3360 UPS STORE #5093 10.12PRIORITY MAIL9.80SHIPPING - GROUND


CHK69307 09/17/2015 2454 WAL-MART 01-3209 107.00LIGHTING COUPON REBATE

CHK69308 09/17/2015 86 WASTE MANAGEMENT-ELK RIVER LA 31,613.33ERMU GAS GENERATOR SERV AGREEME13,460.94LANDFILL GAS PLANT ELEC NRGY 08/2015


CHK69309 09/17/2015 55 WESCO RECEIVABLES CORP. 6,521.85#1000 MCM 25KV Slice

CHK69310 09/17/2015 685 ADI 537.15Lynx Kits

CHK69311 09/17/2015 7308 ADVANTAGE BILLING CONCEPTS 100.00CODING FOR MED ALERT BILLING

CHK69312 09/17/2015 150 ALARM PRODUCTS DIST, INC 371.73Security Parts

CHK69313 09/17/2015 191 AMERICAN PAYMENT CENTERS 208.003RD QTR LOCKBOX FEES52.003RD QTR LOCKBOX FEES


CHK69314 09/17/2015 9997 KATHY ANANTAPHONG 141.85INACTIVE REFUND

CHK69315 09/17/2015 9997 BRADLEY ANDERSON 9.62INACTIVE REFUND

CHK69316 09/17/2015 9997 ELSBETH BAKER 12.23INACTIVE REFUND

CHK69317 09/17/2015 6 BEAUDRY OIL COMPANY 1,698.60FUEL USAGE - DIESEL1,900.62FUEL USAGE - DIESEL


CHK69318 09/17/2015 9997 BEECHWOOD PROPERTIES LLC 21.56INACTIVE REFUND

CHK69319 09/17/2015 9997 ERIKA BOHNENSTINGL 71.14INACTIVE REFUND/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt25203

17

/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69320 09/17/2015 9997 HAZEL BROWN 25.38INACTIVE REFUND

CHK69321 09/17/2015 8843 CAMPBELL KNUTSON 263.50LEGAL SERVICES248.00LEGAL SERVICES


CHK69322 09/17/2015 9997 JOSEPH CARPENTER 27.46INACTIVE REFUND

CHK69323 09/17/2015 3982 CENTERPOINT ENERGY 1,116.02GAS PURCHASED- 911201539.54GAS PURCHASED- 9112015


CHK69324 09/17/2015 9997 MICHELLE CHANEY 20.02INACTIVE REFUND

CHK69325 09/17/2015 9997 ADAM CHENEY 33.05INACTIVE REFUND

CHK69326 09/17/2015 11 CITY OF ELK RIVER -1,675.83STORMWATER SEWER FRANCHISE153,541.15STORMWATER SEWER FRANCHISE37,468.11STORMWATER SEWER FRANCHISE87,006.72STORMWATER SEWER FRANCHISE

17.50BAGS1,334.54ORGANICS

164.00STICKERS109,325.67TRASH


CHK69327 09/17/2015 3290 COBORNS 1,045.07CAKE/SODA 100 YR EVENT

CHK69328 09/17/2015 7448 CRC 1,668.69CRC - ENERGY DISPATCH417.17CRC - ENERGY DISPATCH


CHK69329 09/17/2015 212 DAKOTA SUPPLY GROUP 3,017.82Phase J-Boxes

CHK69330 09/17/2015 9997 TERRANCE DAVEY 193.52INACTIVE REFUND

CHK69331 09/17/2015 9997 JOSH EASTMAN 69.83INACTIVE REFUND

CHK69332 09/17/2015 23 ELK RIVER MUNICIPAL UTILITIES 3,685.52ELECTRICITY:WELL & TOWER SECURITY90.85ELECTRICITY:WELL & TOWER SECURITY

273.03ELECTRICITY:WELL & TOWER SECURITY2,179.07ELECTRICITY:WELL & TOWER SECURITY

18,382.02ELECTRICITY:WELL & TOWER SECURITYTotal for Check/Tran - 69332: 24,610.49


/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69333 09/17/2015 9997 FANNIE MAE 171.64INACTIVE REFUND

CHK69334 09/17/2015 9997 FANNIE MAE 150.03DEP To AP

CHK69335 09/17/2015 9997 FOUR DW CORP 12.31INACTIVE REFUND

CHK69336 09/17/2015 9997 AMANDA GATCHELL 20.12INACTIVE REFUND

CHK69337 09/17/2015 91 GOPHER STATE ONE-CALL 327.32LOCATE SERVICES327.33LOCATE SERVICES


CHK69338 09/17/2015 80 GRAINGER 78.06PARTS FOR BORE RIG

CHK69339 09/17/2015 5118 GRAND RENTAL STATION 98.49TRENCHER44.611-1/2" HAMMER DRILL RENTAL


CHK69340 09/17/2015 9997 DEANNA HENRIKSON 37.80INACTIVE REFUND

CHK69341 09/17/2015 7583 TONY HUBBARD 42.26SCHOOLS & MEETINGS



CHK69343 09/17/2015 9997 JULIA FULTON 17.39INACTIVE REFUND

CHK69344 09/17/2015 9997 LEA LANKKI 41.68INACTIVE REFUND

CHK69345 09/17/2015 9997 TONI LARSON 14.00INACTIVE REFUND

CHK69346 09/17/2015 417 LOCATORS & SUPPLIES INC. 83.32Rain Bibs for Reed

CHK69347 09/17/2015 8605 MARCO 444.86CAMERAS111.22CAMERAS

1,888.20CAMERA NETWORKS472.05CAMERA NETWORKS


CHK69348 09/17/2015 9997 MCR INVESTMENTS II LLC 116.11INACTIVE REFUND

CHK69349 09/17/2015 185 MCR PERFORMANCE SOLUTIONS 2,756.25MISO CALCULATION

CHK69350 09/17/2015 2775 MICHELS CORPORATION 7,333.50WILDFLOWER TRENCHING

CHK69351 09/17/2015 7293 MINNESOTA DEPT OF COMMERCE 5,529.57MPUC QUARTERLY INDIRECT ASSESSME


/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69352 09/17/2015 3376 JEFF MURRAY 63.88SCHOOLS & MEETING

CHK69353 09/17/2015 208 REID NELSON 114.50SCHOOL EXPENSE - MEALS

CHK69354 09/17/2015 9215 NIGHTHAWK TOTAL CONTROL 303.75QUARTERLY TELEMETRY CHARGES

CHK69355 09/17/2015 9997 REBEKAH NILES 99.45INACTIVE REFUND

CHK69356 09/17/2015 9300 NISC 152.85AUG 2015 RECURRING FEES8,776.91AUG 2015 RECURRING FEES1,530.84AUG 2015 RECURRING FEES5,269.18IVUE HOSTING & SUPPORT1,317.30IVUE HOSTING & SUPPORT

172.28IVUE HOSTING & SUPPORT300.00IVUE HOSTING & SUPPORT43.07IVUE HOSTING & SUPPORT


CHK69357 09/17/2015 186 MIKE O'NEILL 32.05PORTFOLIOS

CHK69358 09/17/2015 9997 JEANNENE OTTO 10.07INACTIVE REFUND

CHK69359 09/17/2015 9997 SARAH PEDRYS 49.44INACTIVE REFUND

CHK69360 09/17/2015 9997 RENE R PERKINS 64.84INACTIVE REFUND

CHK69361 09/17/2015 9997 PREMIUM REAL ESTATE SOLUTIONS 71.30INACTIVE REFUND

CHK69362 09/17/2015 71 PRINCIPAL LIFE INSURANCE CO GRAN 2,947.49DENTAL, LIFE & LTD INSURANCE - 9172011,380.53DENTAL, LIFE & LTD INSURANCE - 9172013,140.04DENTAL, LIFE & LTD INSURANCE - 917201


CHK69363 09/17/2015 9997 SHAWN RAWSKI 80.70INACTIVE REFUND

CHK69364 09/17/2015 3219 RESOURCE TRAINING & SOLUTIONS/B 16,794.00HEALTH CARE PREMIUMS - OCT7,464.00HEALTH CARE PREMIUMS - OCT5,598.00HEALTH CARE PREMIUMS - OCT

17,748.28HEALTH CARE PREMIUMS - OCT7,888.13HEALTH CARE PREMIUMS - OCT5,916.09HEALTH CARE PREMIUMS - OCT


CHK69365 09/17/2015 9997 DONALD SCHUMACHER 165.33INACTIVE REFUND

CHK69366 09/17/2015 9997 DUSTIN SMITH 32.33INACTIVE REFUND/pro/rpttemplate/acct/2.33.1/ap/AP_CHK_REGISTER.xml.rpt25203

20

/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69367 09/17/2015 9997 MIAH SNESRUD 16.54INACTIVE REFUND

CHK69368 09/17/2015 9997 ABBY SOLOMONSON 55.70INACTIVE REFUND

CHK69369 09/17/2015 9997 ROBIN STEMAN 11.25INACTIVE REFUND

CHK69370 09/17/2015 6107 STUART C. IRBY CO. 4,472.72Burndy 1000 Tool1,458.84ST800 service tester

283.22Burndy Die for new toolTotal for Check/Tran - 69370: 6,214.78

CHK69371 09/17/2015 9997 THE RYAN JOHNSON GROUP 53.11INACTIVE REFUND

CHK69372 09/17/2015 74 SCOTT THORESON 143.95SCHOOL EXPENSE - MEALS

CHK69373 09/17/2015 7681 TOSHIBA FINANCIAL SERVICES 115.18CONTRACT COPIERS28.79CONTRACT COPIERS


CHK69374 09/17/2015 9997 JANEE UDALLA 15.26INACTIVE REFUND

CHK69375 09/17/2015 9191 UPS 40.24SHIPPING

CHK69376 09/17/2015 219 US POSTAL SERVICE/ HASLER 124.006 MONTH RENTAL FEE31.006 MONTH RENTAL FEE


CHK69377 09/17/2015 9997 MARILYN VANPATTEN 36.75INACTIVE REFUND

CHK69378 09/17/2015 8381 VERIFIED CREDENTIALS 37.60AUGUST BACKGROUND SCREENING9.40AUGUST BACKGROUND SCREENING


CHK69379 09/17/2015 205 VISION OF ELK RIVER, INC 235.00100 YEAR ANNIVERSARY ITEMS - SHUTTL

CHK69380 09/17/2015 8439 ERIC VOLK 176.30TRAVEL TO AWWA CONF

CHK69381 09/17/2015 210 CURTIS WARK 111.70SCHOOL EXPENSE - MEALS

CHK69382 09/17/2015 702 WEST SHERBURNE TRIBUNE 260.00COMMUNITY GUIDE AD

CHK69383 09/17/2015 9344 AARON WHITE 105.64SCHOOL EXPENSE - MEALS

CHK69384 09/17/2015 9997 CHRISTIAN WILSON 6.06INACTIVE REFUND

CHK69385 09/17/2015 685 ADI 402.47Wireless Glassbreaks32.44ANT GSMV4G


/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date



CHK69386 09/17/2015 8372 ALARM.COM INCORPORATED 17.50VIDEOFIED MONITORING

CHK69387 09/17/2015 4531 AT & T MOBILITY 48.98MONTHLY CELL PHONES1,174.26MONTHLY CELL PHONES

256.06MONTHLY CELL PHONESTotal for Check/Tran - 69387: 1,479.30

CHK69388 09/17/2015 8552 BECK LAW OFFICE 832.20AUGUST LEGAL SERVICES208.05AUGUST LEGAL SERVICES


CHK69389 09/17/2015 9 BORDER STATES ELECTRIC SUPPLY 10,440.00Meters for Connexus Acq.

CHK69390 09/17/2015 11 CITY OF ELK RIVER 117.56PARTS & REPAIR - UNIT 2655.62REPAIRS - UNIT 35


CHK69391 09/17/2015 23 ELK RIVER MUNICIPAL UTILITIES 619.08SECURITY MONITORING - LANDFILL

CHK69392 09/17/2015 8949 FS3 INC. 906.25Red Marking Post

CHK69393 09/17/2015 28 G & K SERVICES SERVICES 100.66MATS & TOWELS25.17MATS & TOWELS


CHK69394 09/17/2015 80 GRAINGER 72.18DESK LIGHT18.04DESK LIGHT


CHK69395 09/17/2015 64 GRANITE ELECTRONICS INC 83.91Pager Holders

CHK69396 09/17/2015 846 HACH COMPANY 356.62CYANIDE & SOLVENTS

CHK69397 09/17/2015 4984 ANGELA HAUGE 64.07HEALTH FAIR EXPENSES19.08HEALTH FAIR EXPENSES4.77HEALTH FAIR EXPENSES


CHK69398 09/17/2015 809 HAWKINS, INC. 1,796.11SHOP CHEMICALS

CHK69399 09/17/2015 6836 INNOVATIVE OFFICE SOLUTIONS, LLC 35.68SEALING TAPE8.92SEALING TAPE


22

/02/2015 1:03:23 PMRevision: 76714




Check /Tran Date


CHK69400 09/17/2015 199 KJOLHAUG ENVIRONMENTAL SERVICE 588.50MAIN STREET DELINEATION

CHK69401 09/17/2015 417 LOCATORS & SUPPLIES INC. 127.99Safety Glasses85.29Safety glasses


CHK69402 09/17/2015 9273 METERING & TECHNOLOGY SOLUTION 4,660.00Badger M-2000 Mag Meter

CHK69403 09/17/2015 8340 MI-TECH POLE INSPECTIONS 1,593.88Pole Inspection

CHK69404 09/17/2015 40 MINNESOTA RURAL WATER ASSOC 250.00ANNUAL MEMBERSHIP DUES

CHK69405 09/17/2015 573 NCPERS MINNESOTA 256.00EXTRA LIFE INSURANCE - ERMU EMPLOY

CHK69406 09/17/2015 4049 OLIVER SURVEYING & ENGINEERING, I 3,450.004TH STREET TOPO900.00WACO ROBOTIC CREW


CHK69407 09/17/2015 130 RESCO 13,793.001000KVA Transformer

CHK69408 09/17/2015 8974 RANDY SMITH 250.48REISSUE DEPOSIT REFUND-20.00BANK FEE


CHK69409 09/17/2015 8551 STERLING TROPHY 73.05ENGRAVING - VOLUNTEER - 100TH ANNIV

CHK69410 09/17/2015 8986 TELIT WIRELESS SOLUTIONS 105.75AIRCARDS FOR LAPTOPS

CHK69411 09/17/2015 345 UTILITY TRUCK SERVICES 734.44WINCH REPAIRS

Total for Bank Account - 1 : (273) 3,714,817.11


/02/2015 1:03:23 PMRevision: 76714



09/01/2015 To 09/30/2015Bank Account: 2 - ELECTRIC/PAYROLL

Check /Tran Date


WIRE58 09/11/2015 50 AFFINITY PLUS CREDIT UNION 2,008.00AFFINITY CREDIT UNION

WIRE60 09/25/2015 50 AFFINITY PLUS CREDIT UNION 2,008.00AFFINITY CREDIT UNION

Total for Bank Account - 2 : (2) 4,016.00

Grand Total : 3,718,833.11(275)


/02/2015 1:03:23 PMRevision: 76714



PARAMETERS ENTERED:

Check Date: 09/01/2015 To 09/30/2015Bank: All

Vendor: AllCheck: All

Journal: AllFormat: All GL References/Amounts

Extended Reference: NoCheck/TransactionSort By:

Voids: NoneAllPayment Type:NoGroup By Payment Type:

Minimum Amount: 0.00Authorization Listing: No

Authorization Comments: NoCredit Card Charges: No


Regular meeting of the Elk River Municipal Utilities Commission

September 8, 2015

ELK RIVER MUNICIPAL UTILITIES

REGULAR MEETING OF THE

UTILITIES COMMISSION

HELD AT UTILITIES CONFERENCE ROOM

September 8, 2015

Members Present: John Dietz, Chair; Al Nadeau, Vice Chair; and Daryl Thompson, Trustee

ERMU Staff Present: Troy Adams, General Manager;

Theresa Slominski, Finance and Office Manager;

Mark Fuchs, Electric Superintendent;

Eric Volk, Water Superintendent;

Mike O’Neill, Technical Services Superintendent;

Tom Sagstetter, Conservation & Key Accounts Manager;

Michelle Canterbury, Executive Administrative Assistant;

Tom Geiser, Assistant Electric Superintendent

Others Present: Cal Portner, City Administrator; Peter Beck, Attorney

1.0 CALL MEETING TO ORDER

John Dietz called the September 8, 2015 meeting to order at 3:30 p.m.

1.1 Pledge of Allegiance

The Pledge of Allegiance was recited.

1.2 Consider Utilities Agenda

Troy Adams requested to move up agenda item 4.2, Vision Committee 100th Anniversary Recap

to immediately follow 1.2, Consider Utilities Agenda.

Al Nadeau moved to approve the amended September 8, 2015 Utilities agenda. John Dietz

seconded the motion. Motion carried 2-0.

4.2 Vision Committee – 100th

Anniversary Recap

Tom Sagstetter gave a recap on the 100th anniversary celebration. Tom started by thanking the

Commission for allowing the office to close an hour early for the event. The event had great

participation; there were approximately 1,300 people who attended. We received many positive

comments that focused on the quality of food, the great band, and one person even said they

were looking forward to the 200 year celebration! The vendor booths were well attended, kid

zone was packed, the tours were full, and the safety demonstrations and heavy equipment areas

were also well attended. Michelle Canterbury thanked the members of the vision committee

26


September 8, 2015

that went over and above the call of duty to help make the event such a success; Jolene Fenn-

Jansen, Mike Thiry, Angela Hauge, Geri Fournier, Wade Lovelette, Mike O’Neill, Daryl

Thompson, and Tom Sagstetter. Individual recognition and thanks were given to each of the

contributors for the event. Representatives were present from Waste Management, Coborn’s,

the Elk River Lions, and the Sherburne County Fair Board. Other contributors included Elk

River Travel and ISD 728 Community Education.

John Dietz thanked Michelle Canterbury for the outstanding job she did with coordinating the

event. He added that it was a great community event, everything he heard was positive, and we

received a tremendous amount of publicity from our local newspaper. The event was an

opportunity to showcase what we offer to our citizens. John extended his thanks to everyone and

what they did to help make the event such a success.

1.3 Introduction of New Employee

Theresa Slominski introduced Kathy Greenberg the new Accounts Payable and Payroll

Specialist. The Commission welcomed the new employee.

1.4 Recognition of Employee Achievements

Troy Adams announced that Jennie Nelson recently received the American Public Power

Association (APPA) Rising Star Award. Jennie was recognized for her achievement at the

APPA National Conference held in Minneapolis, MN. Eric Volk announced that Lead Water

Operator Mike Langer received the Minnesota Municipal Utilities Association (MMUA) Rising

Star Award. Mike was recognized for his achievement at the MMUA Annual Summer

Conference held in Pequot Lakes, MN. John Dietz shared that Troy Adams was elected as the

2015-2016 MMUA Board of Directors President at the MMUA Summer Conference. The

Commission congratulated the employees on their achievements.

2.0 CONSENT AGENDA (Approved By One Motion)

John Dietz had a few questions on the financials, staff responded.

Al Nadeau moved to approve the Consent Agenda as follows:

2.1 August Check Register

2.2 August 11, 2015 Previous Meeting Minutes

2.3 Financial Statements

2.4 Connexus Electric Service Territory Transfer Agreement

2.5 Public Power Week Resolution

2.6 Customer Service Week Resolution

2.7 Minnesota Municipal Utilities Association 2015-2016 Safety Program Contract

27


September 8, 2015

John Dietz seconded the motion. Motion carried 2-0.

3.0 OPEN FORUM

Alex Bodnar was at the meeting to follow-up on the Petition for Water Main Looping and

Extension Variance that was on the August 11, 2015 commission agenda. Alex distributed a

copy of the Recommended Standards for Water Works – Section 8.2.4 Dead ends. He also

provided a quote from Brenteson Companies for installation of sanitary sewer and water main,

and services. Alex was looking for Commission support for a variance to the city council stating

that water can’t be provided to the area in a cost effective manner. As action can’t be taken in

open forum, the Commission requested Alex Bodnar write up a formal request of exactly what

he is asking for, and submit his request to ERMU staff by October 1, 2015 to allow them the

time to review and include it on the October 13, 2015 agenda for Commission decision.

4.0 OLD BUSINESS

4.1 Electric Service Territory

As staff prepares for the acquisition of Connexus customers this fall, there are numerous areas

that will be discussed with the Commission. At this point of time, the key points of discussion

are: electric rates, integration of electric utility infrastructure, and customer data migration.

Electric rates – Tom Sagstetter shared that we haven’t received many calls on the electric rates.

We have provided one commercial customer with a rate analysis. Tom also shared that we’re

scheduled to meet with Dave Berg from Dave Berg Consulting, LLC (DBC) this week to begin

a rate analysis and come up with some possible options to help mitigate increased costs going

from a Connexus program to ours.

Integration of the utility infrastructure – We have 299 accounts that we’ll be transferring over to

our system on September 22, 2015. After they’re transferred over, we’ll begin to change the

meters out to ours. Tom shared that we’re working closely with the one three phase commercial

customer that will be transferred over on September 22nd

to help ensure a smooth transition.

Included in the packet were examples of the load management and final system transfer letter

that will be going out to customers. John Dietz had a question on whether we were going to

make an attempt to contact all the commercial customers to inform them of the changeover time

and how it may affect them. Staff responded. There was further discussion.

5.0 NEW BUSINESS

5.1 2016 Budget: 10 Year Capital Improvement Projections; 2016 Capital Projects and

Equipment Purchases; and 2016 Conservation Improvement Plan

28


September 8, 2015

Troy Adams presented the 2016 Capital Projections, Capital Projects and Equipment

Purchases and the Conservation Improvement Plan. Notable items for the Electric

Department are Territory Acquisition costs, a new feeder to the Natures Edge Business

Park, replacing dump truck #16, a potential new substation and feeder for data center

growth, and construction/renovation of the field services building. Troy explained that a

few of these projects could be financed through reserves or bonds; so as not to have a direct

effect on our rate design. There was further discussion on the projects, the priority, and the

manpower required.

Notable items for the Water Department are the construction of a new filter plant for well

#9 and construction/renovation of the field services facilities. We would plan to pay for the

well project with reserves and trunk funds and the field services project through bonds.

John Dietz had a question on the money budgeted for the Jackson Street Water Tower

restoration project. Staff responded.

A notable item for the Administration and Technical Services Department is a new in

house server for NISC. Theresa Slominski shared that when we converted over to NISC we

had the option to go with a Cloud based Application Service Provider (ASP) or to have our

own server in house; at that time we decided to go with the less expensive cloud based

service. Theresa shared the challenges we’ve experience since we switched over to the

ASP and what it would take to bring it back in house. There would be numerous

advantages to having it in house and we may have the option of using the city’s existing

server. Theresa also provided costs for purchasing our own designated hardware. There

was further discussion. John Dietz had a question on the $10,000 line item for City

Hall/Utility Fitness Room. Staff responded. There was discussion on the $240,000

budgeted for the Landfill expansion project.

Tom Sagstetter went over the Conservation Improvement Program (CIP) Budget. He

shared that our energy savings goal mandated by the state was increased to 2.3 million kW

hours, so the rebate budget is about $85,000 higher. As we would normally have a hard

time spending the rebate dollars, we’re pleased to have some of those funds available for

our newly acquired Connexus customers that meet the rebate requirements.

5.2 Minnesota Municipal Utilities Association Annual Summer Conference Update

The Minnesota Municipal Utilities Associations (MMUA) Annual Summer Conference

was held in Pequot Lakes, MN. An MMUA board meeting was held prior to the

conference and a business meeting of the membership was held in conjunction with the

conference. Troy Adams provided a memo recapping the conference highlights and

important topics. He also shared that a 1.5% MMUA dues revenue increase and modified

dues structure was approved. The changes result in a 0.37% dues increase for ERMU in

2016. Troy stressed the value added benefits of our membership with MMUA.

29


September 8, 2015

5.3 Environmental Pollution Agency Rules affecting ERMU’s Diesel Generation Facility

Mike O’Neill explained that in the original Reciprocating Internal Combustion Engine

Rules, also known as the RICE Rules, it stipulated that an entity could run their engines up

to 100 hours for testing and maintenance. This exception was later deleted by a court’s

decision. Another Petition for Review was submitted and a stay of the earlier ruling was

granted until a final decision could be reached. This stay of issuance of the mandate will

be in place through May 1, 2016. A final decision should be forthcoming prior to the

expiration of the stay. ERMU must decide whether to upgrade the exhaust systems on our

generators to bring them into compliance, at a cost of approximately $400,000, or forgo

placing them on the Midcontinent Independent System Operator (MISO) market with GRE

and keep the engines to be used for emergency purposes only.

The two other factors that come into play are our 2016 contract with Great River Energy

(GRE) and our 2018 contract with Minnesota Municipal Power Agency (MMPA). At this

point we don’t know what MMPA will want to do with these engines. Troy Adams and

Mike O’Neill will be in discussions with MMPA to see what their interest is. In addition,

Mike will be working with vendors to assess the need and cost of retrofitting and upgrading

the exhaust systems for the two engines to bring them into compliance with the new EPA

regulations. Staff will bring back some firmer dollar amounts for the retrofit project should

the Commission choose to move forward with it.

5.4 Payment in Lieu of Taxes and Other Donations to the City of Elk River

On March 20, 2015, an electric service territory transfer agreement was executed between

ERMU and Connexus. The terms of the agreement provide for loss of revenue (LOR)

payments for 10 years. Now that the negotiations have been completed and terms

finalized, the payment in lieu of taxes (PILOT) provisions should be revised to reflect an

exemption for customers that are subject to LOR payment. As these LOR payments

complete their 10 year term, the revenue associated with these customers would then

become subject to a PILOT per the policy. Troy Adams presented the proposed PILOT and

Other Donations to the City of Elk River policy that would reflect these changes.

John Dietz pointed out that the way the proposed policy was worded may cause some

confusion as it doesn’t identify which electric service customers would be subject to the

LOR. John suggested that modifications be made to the proposed policy, to include the

clause “per the March 20, 2015 service territory agreement”, and brought back to the

Commission for consideration and approval.

5.5 Wage and Benefits Committee Update – Health & Dental Insurance

On September 8, 2015 the Wage and Benefits Committee (W&BC) met to review dental,

30


September 8, 2015

ancillary, and health insurance renewals; and HSA employer contributions. Theresa

Slominski gave a verbal update on the insurance renewals that were discussed.

Theresa Slominski explained that we currently have both our ancillary and dental insurance

coverage through Principal who we’ve been using for the past three years. After going out

for bids for 2016, we’ve identified that we would recognize a significant savings if we were

to switch over to a three year contract with Assurant; who has very similar coverage, and

who we were with prior to switching over to Principal. There was further discussion.

Theresa Slominski presented the health insurance renewal, which had an 8.3% increase for

our plan. She explained that we participate in an insurance pool with Resource Training &

Solutions, and the range of renewals for their clients came in between -3% to 19.9%. Based

on this reasonable renewal rate, staff would recommend staying with our current plan.

Theresa Slominski went over the 2016 HSA limits and deductibles. Currently the employer

is contributing $1,985 a year towards the family plans and $650 a year towards the

individual plans. John Dietz added that we currently have 13 people on the co-pay plan

and 20 people that have migrated over to the HSA plan. He was in favor of keeping the

company contribution to the HSA plan, and reevaluating it on a year to year basis. There

was further discussion on our current co-pay insurance plan that could potentially be

subject to a “Cadillac Tax”.

Daryl Thompson made a motion to switch our 2016 ancillary services and dental

insurance from Principal to Assurant; to approve the 2016 ancillary services and

dental insurance from Assurant; to approve the 2016 HSA insurance plan employer

contribution of $1,985 for family and $650 for single; and to approve the Blue Cross

Blue Shield Health Insurance Plan with the 8.3% increase. Al Nadeau seconded the

motion. Motion carried 3-0.

5.6 Expansion of the Elk River Municipal Utilities Board of Commissioners

Troy Adams shared that when the territory acquisition discussions began a few years ago,

there was discussion on expanding the commission to provide better representation of the

growing customer base, and based on the newly acquired territory and normal growth,

ERMU will likely experience a 20% growth over the next five years. Troy explained the

steps involved to expand the utility commission from 3 to 5 members. There was further

discussion. The Commission was in favor of expanding the commission membership. John

Dietz suggested that before we request council action, we should bring it to a city council

workshop for discussion to help determine if we have council support and to get their

opinion on two city council members serving on the commission board versus one city

council member. The commission directed staff to prepare a memo on the expansion and

submit it to the city for discussion at an upcoming workshop.

31


September 8, 2015

6.0 OTHER BUSINESS

6.1 Staff Updates

Troy Adams’ staff report included a bullet point on the MMPA Board of Directors meeting held

on August 25, 2015 in Shakopee, MN. At the meeting, the Board approved the execution of a

10 MW power purchase agreement for a solar facility to be located in Buffalo, MN. John Dietz

had some questions on the solar facility. Staff responded.

Theresa Slominski had previously shared that with our health insurance we have through

Resource Training & Solutions (RT&S), we participate in a co-op to receive reduced insurance

rates. RT&S has a very advanced wellness program that we participate in. We were recently

selected to receive their Well Workplace Award in the fall of 2015 for the work we did in 2014.

Theresa extended an invitation to the Commission to the Customer Appreciation Event and

Awards Banquet being held on October 7, 2015. Efforts of Michelle Martindale and Angela

Hauge, who serve as our representatives on the committee, will be recognized at the awards

banquet.

6.2 Set Date for Next Meeting

The next regularly scheduled Commission meeting will be held on October 13, 2015.

6.3 Adjourn Regular Meeting

Daryl Thompson moved to adjourn the regular meeting of the Elk River Municipal

Utilities Commission at 4:59 p.m. Al Nadeau seconded the motion. Motion carried 3-0.

Minutes prepared by Michelle Canterbury.

___________________________

John J. Dietz

Chair, ERMU Commission

___________________________

Tina Allard

City Clerk

32

FINANCIAL INDEX

Aug-15 PAGE

P & L NARRATIVE ………….. 34

COMBINED BALANCE SHEET ………….. 36

ELECTRIC INCOME STATEMENT ………….. 37

WATER INCOME STATEMENT ………….. 39

GRAPH #1 ELECTRICAL PURCHASES ………….. 40

GRAPH #2 ELECTRIC SALES ………….. 41

GRAPH #3 ELECTRIC SALES/CUSTOMER CLASS ………….. 42

GRAPH #4 WATER PRODUCTION ………….. 43

GRAPH #5 WATER SALES ………….. 44

DETAILED ELECTRIC INCOME STATEMENT ………….. 45

………….. 46

………….. 47

………….. 48

………….. 49

………….. 50

…………. 51

DETAILED WATER INCOME STATEMENT ………….. 52

………….. 53

………….. 54

………….. 55

33

PROFIT AND LOSS NARRATIVE

August 2015

Electric P&L

August’s electric kwh sales (for July usage) are up from the prior year by 6% overall:

Residential usage is up 10.8%

Small Commercial usage is up 9%

Large Commercial usage is up 3% from the prior year.

August Operating Revenue is up from the prior year by 9.4% for the month, up slightly at

.86% for year-to-date numbers, and over year-to-date budgeted numbers by 1.8%.

August 2014 had a PCA charge to customers of $26,000, impacting the revenue in

August 2014 by less than 1% at .87%.

Other Revenue is above the prior year by 8.5% for August. Connection Fees are a small

component this month at $24,375, but last year was even smaller at $11,150.

Miscellaneous Revenue was significantly more in 2014 due to a gain of $18,000

recognized on the trade-in of our bucket truck, and 2015 does not have an August MISO

payment (it was paid in September this year.)

Overall, Total Revenues of $3,453,830 are above the prior year $3,184,018 by 8.5%,

year-to-date revenues are ahead .63%, and budgeted numbers are increased 1.7%.

Purchased Power is up from the prior year 3.7%, consistent with the increased usage.

Year-to-date the difference in costs for purchased power are 5.6% less than the prior year

due to PCAs in 2014.

For other expenses, there is much consistency from the prior year. Customer Accounts

Expense is inconsistent as it continues to be larger than last year due to the NISC

software costs. Administrative and General Expenses are inconsistent from the prior year

for a couple of reasons: increased approximately $25,000 for supplies and labor with the

Anniversary celebration (as budgeted), increased $22,000 for medical premiums of 8 new

employees hired in May 2015 (billed in arrears for June and July - so a timing difference

but a budgeted expense), and increased $25,000 for consulting fees with our MISO

reporting (again, a timing difference but a budgeted expense.)

Total expenses were $3,179,074, over the previous year for August by 5.3% and under

year-to-date numbers by 2.7%.

The Electric Department has a Net Profit of $142,816, compared to the prior year Net

Profit of $37,160. Year-to-date there is a Net Profit of $1,355,141, compared to the prior

year Net Profit of $698,403.

34

Water P&L

August’s water consumption (for July usage) is down 24% overall from the prior year:

Residential usage is down 27%

Commercial usage is down 21%

Water Operating Revenues are behind last year by 26% at $295,762 however, year-to-

date revenues are ahead by 4%.

Other Revenues are ahead of the prior year at $80,931, compared to $28,296. The

increase over the prior year is due to significant builder Connection Fees of $61,135 in

August, and amendments to water tower leases. Total Revenues of $376,693 are behind

the prior year by 14%, yet year-to-date up by 6%. Year-to-date revenues are ahead of

budget by 15%.

Expenses are very consistent with the prior year. Production Expense is up approximately

$4,000 due to maintenance of the actuators treating the radon at well 2. Distribution

Expense is down due to the water main break in 2014 resulting in approximately $5,000

non-recurring expense.

For August, the Water Department has a Net Profit of $164,517, compared to last year

Net Profit of $216,658. Year-to-date there is a Net Loss of ($29,296), compared to the

prior year Net Loss of ($91,395).

35

COMBINED BALANCE SHEETAUGUST 2015

ELECTRIC WATERASSETSCURRENT ASSETS CASH & TEMPORARY INVESTMENTS 2,600,8368,989,637 ACCOUNTS RECEIVABLE 469,6833,784,559 INVENTORIES 24,6461,221,666 PREPAID ITEMS 27,542136,925 CONSTRUCTION IN PROGRESS 598,262543,150 TOTAL CURRENT ASSETS 3,720,96914,675,938

RESTRICTED ASSETS BOND RESERVE FUND 0490,500 EMERGENCY RESERVE FUND 1,153,5392,516,804 UNRESTRICTED RESERVE FUND 113,82438,884 TOTAL RESTRICTED ASSETS 1,267,3633,046,188

FIXED ASSETS PRODUCTION 11,223,696391,219 LFG PROJECT 03,804,327 TRANSMISSION 0714,482 DISTRIBUTION 21,917,65934,444,512 GENERAL 916,7627,756,404 FIXED ASSETS (COST) 34,058,11747,110,944 LESS ACCUMULATED DEPRECIATION (13,782,021)(21,247,012) TOTAL FIXED ASSETS, NET 20,276,09625,863,932

OTHER ASSETS AND DEFFERED OUTFLOWS (6,133)(65,102)

TOTAL ASSETS 25,258,29543,520,956

LIABILITIES AND FUND EQUITYCURRENT LIABILITIES ACCOUNTS PAYABLE 87,3733,314,269 SALARIES AND BENEFITS PAYABLE 120,200304,128 DUE TO CITY 0559,142 DUE TO OTHER FUNDS 00 BONDS PAYABLE-CURRENT PORTION 00 UNEARNED REVENUE 142,8443,376 TOTAL CURRENT LIABLITIES 350,4184,180,914LONG TERM LIABILITIES LFG PROJECT 01,408,358 DUE TO COUNTY 00 BONDS PAYABLE, LESS CURRENT PORTION 1,850,6423,607,488 TOTAL LONG TERM LIABILITIES 1,850,6425,015,846

TOTAL LIABILITIES 2,201,0599,196,760

FUND EQUITY CAPITAL ACCOUNT CONST COST 0490,500 CONTRIBUTED CAPITAL 00 RETAINED EARNINGS 23,086,53232,478,554 NET INCOME (LOSS) (THROUGH PREVIOUS MONTH) (29,296)1,355,141 TOTAL FUND EQUITY 23,057,23634,324,195

TOTAL LIABILITIES & FUND EQUITY 25,258,29543,520,956

36

ELK RIVER MUNICIPAL UTILITESELK RIVER, MINNESOTA

STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITIONFOR PERIOD ENDING AUGUST 2015

2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD

BUDGET2015 YTDBud Var%

2014 v. 2015Actual Var%

YTDVARIANCE

2015 ANNUALBUDGET

Electric

RevenueOperating Revenue Elk River 3,009,066 18,745,202 18,308,064 2,766,839 18,036,5742 427,876,812 708,628 Elk River-City Donated 17,065 120,178 141,910 21,403 140,480(15) (14)219,650 (20,302) Otsego 282,466 1,602,278 1,602,588 252,393 1,586,9910 12,419,908 15,288 Rural Big Lake 22,980 129,564 146,863 20,540 139,541(12) (7)219,471 (9,976) Dayton 27,840 155,698 171,160 23,913 162,097(9) (4)256,678 (6,399) Public St & Hwy Lighting 30,178 237,103 256,815 29,638 235,800(8) 1386,861 1,303 Generation and Sub Station Credit 2,948 23,703 33,674 2,968 28,780(30) (18)41,175 (5,077) Dispersed Generation Credit (100,694) (545,586) (566,542) (106,848) (537,264)(4) 2(771,008) (8,322) Other Revenue/CIP/Rate Increase/AC Credit (11,367) (34,410) (29,967) (11,088) 467,00615 (107)(50,000) (501,416)

Total Operating Revenue 3,280,482 20,433,730 20,064,565 2,999,758 20,260,0042 130,599,548 173,726

Other Operating Revenue Interest/Dividend Income 6,969 70,178 71,617 7,821 67,931(2) 3105,000 2,247 Customer Penalties 23,513 139,933 148,764 18,140 154,359(6) (9)250,000 (14,426) LFG Project 92,762 716,240 781,061 92,592 736,505(8) (3)1,136,812 (20,265) Connection Fees 24,375 102,663 44,773 11,150 94,766129 8125,000 7,897 Security 19,777 164,617 180,062 23,547 150,616(9) 9270,000 14,001 Misc Revenue 5,953 102,244 75,124 31,010 129,01636 (21)125,720 (26,772) Prior Period Adjustment 0 0 0 0 00 00 0

Total Other Revenue 173,348 1,295,875 1,301,401 184,260 1,333,1930 (3)2,012,532 (37,318)

Total Revenue 3,453,830 21,729,605 21,365,966 3,184,018 21,593,1962 132,612,080 136,408

Expenses Purchased Power 2,544,129 14,519,260 14,887,418 2,454,045 15,382,314(2) (6)22,577,733 (863,054) Operating & Mtce Expense 31,403 147,743 197,480 23,582 173,212(25) (15)327,422 (25,469) Landfill Gas 56,508 486,359 459,068 60,478 435,3946 12717,500 50,965 Transmission Expense 472 472 0 0 00 00 472 Distribution Expense 22,234 171,014 150,172 15,769 125,25014 37227,515 45,764 Maintenance Expense 76,231 677,744 652,432 73,849 598,9034 13947,770 78,841 Depreciation 159,760 1,272,743 1,533,333 151,595 1,297,181(17) (2)2,300,000 (24,437) Interest Expense 9,086 80,332 84,734 10,891 116,696(5) (31)123,537 (36,364) Security 17,867 141,252 148,623 16,670 131,445(5) 7215,000 9,808 Other Operating Expense 293 12,956 14,347 1,029 19,857(10) (35)39,800 (6,901) Customer Accounts Expense 20,445 196,113 185,424 15,510 139,9986 40255,720 56,11437



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

Administrative & General Expense 240,646 1,770,341 1,908,874 193,024 1,588,923(7) 113,053,013 181,418

Total Expenses(before Operating Transfers) 3,179,074 19,476,330 20,221,905 3,016,441 20,009,173(4) (3)30,785,010 (532,844)

Operating Transfer Transfer To City For 99 Bond 0 0 0 0 00 00 0 Operating Transfer/Other Funds 87,007 545,292 530,297 81,325 530,7383 3810,000 14,555 Utilities & Labor Donated 44,934 352,842 336,334 49,092 354,8835 (1)515,000 (2,041)

Total Operating Transfer 131,941 898,134 866,631 130,418 885,6214 11,325,000 12,514 Net Income Profit(Loss) 142,816 1,355,141 277,430 37,160 698,403388 94502,070 656,738

38



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

Water

RevenueOperating Revenue Water Sales 295,762 1,334,368 1,239,619 401,942 1,277,6628 42,193,576 56,706

Total Operating Revenue 295,762 1,334,368 1,239,619 401,942 1,277,6628 42,193,576 56,706

Other Operating Revenue Interest/Dividend Income 1,742 17,516 14,829 1,955 17,05718 326,700 459 Customer Penalties 3,079 10,587 6,366 1,639 10,86366 (3)15,000 (277) Connection Fees 61,135 170,960 100,821 16,580 171,62770 0165,000 (666) Misc Revenue 14,975 111,785 66,457 8,121 78,82468 42103,680 32,962 Restate Beginning Retained Earnings 0 0 0 0 00 00 0

Total Other Revenue 80,931 310,848 188,473 28,296 278,37065 12310,380 32,478

Total Revenue 376,693 1,645,216 1,428,092 430,238 1,556,03315 62,503,956 89,184

Expenses Production Expense 5,181 19,152 14,191 903 5,17635 27020,000 13,977 Pumping Expense 39,037 261,067 303,696 41,470 294,636(14) (11)449,600 (33,569) Distribution Expense 15,014 126,504 136,001 21,865 132,281(7) (4)192,500 (5,777) Depreciation 93,658 747,185 753,336 90,478 720,104(1) 41,130,000 27,080 Interest Expense 5,382 43,608 44,506 5,937 48,899(2) (11)66,262 (5,291) Other Operating Expense 38 1,407 0 157 45,0870 (97)228 (43,680) Customer Accounts Expense 4,447 42,121 38,575 4,463 33,4159 2659,500 8,705 Administrative & General Expense 48,301 397,750 385,575 48,307 342,8293 16592,440 54,921

Total Expenses(before Operating Transfers) 211,059 1,638,794 1,675,880 213,579 1,622,428(2) 12,510,530 16,366

Operating Transfer Transfer To City For 99 Bond 0 30,000 30,000 0 25,0000 2030,000 5,000 Operating Transfer/Other Funds 0 0 0 0 00 00 0 Operating Transfer From City 0 0 0 0 00 00 0 Utilities & Labor Donated 1,118 5,719 336 0 01,602 0500 5,719

Total Operating Transfer 1,118 35,719 30,336 0 25,00018 4330,500 10,719 Net Income Profit(Loss) 164,517 (29,296) (278,124) 216,658 (91,395)(89) (68)(37,074) 62,098

39

))

20

25

30

35

40

45

50

55

60

65

De

ma

nd

in

MW

Month

Elk River Municipal Utilities Monthly Electrical Demand

2015

2014

14,000

19,000

24,000

29,000

34,000

En

erg

y P

urc

ha

se

s i

n M

WH

Month

Elk River Municipal Utilities Monthly Energy Purchases

2014

2015

40

10,000

12,000

14,000

16,000

18,000

20,000

22,000

24,000

26,000

28,000

30,000

Ele

ctr

ic L

oad

in

MW

H

Month

Elk River Municipal Utilities Monthly Total Electric Load

2014

2015

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000

Sa

les

in

Do

lla

rs

Month

Elk River Municipal Utilities Monthly Electric Sales

2014 2015

41

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

Lo

ad

s in

MW

H

Month

Elk River Municipal Utilities Monthly Residential, Commercial & Industrial Loads

Residential

Industrial

Commercial

2015

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

Sale

s i

n D

oll

ars

Month

Elk River Municipal Utilities Monthly Residential, Commercial & Industrial Sales

Residential

Commercial

2014

2015

Industrial

2014

42

0

20

40

60

80

100

120

140

Pu

mp

ag

e i

n M

illio

n G

al.

Month

Elk River Municipal Utilities Monthly Water Pumpage

2015

2014

0

1

2

3

4

5

6

Pe

ak

Da

y i

n M

illi

on

Ga

l.

Month

Elk River Municipal Utilities Peak Day Pumpage

2014

2015

43

0

20

40

60

80

100

120

140

Sa

les

in

Mil

lio

n G

al.

Month

Elk River Municipal Utilities Monthly Water Sales

2014

2015

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

Sale

s i

n D

ollars

Month

Elk River Municipal Utilities Monthly Water Sales

2015

2014

44



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

Electric

RevenueOperating Revenue Elk River

ELECT SALES/ELK RIVER RES 997,185 6,386,1071,138,435 6,647,4376,545,157 (2) 2440.4411 9,981,317 159,050

ELECT SALES/ER NON-DEMAND 283,029 1,794,103312,434 1,796,8741,932,620 8 8440.4412 2,750,593 138,517

ELECT SALES/ER DEMAND 1,486,625 9,856,3641,558,196 9,863,75310,267,425 4 4440.4413 15,144,902 411,061

3,009,066 18,745,202 18,308,064 2,766,839 18,036,5742 4Total For Elk River: 27,876,812 708,628

Elk River-City DonatedELECT SALES/ER CITY DONATED 21,403 140,48017,065 141,910120,178 (15) (14)440.4415 219,650 (20,302)

17,065 120,178 141,910 21,403 140,480(15) (14)Total For Elk River-City Donated: 219,650 (20,302)

OtsegoELECT SALES/OTSEGO RES 119,309 762,059138,088 777,707749,633 (4) (2)440.4416 1,178,976 (12,425)

ELECT SALES/OTSEGO NON-DEM 54,803 319,08056,669 309,836318,368 3 0440.4417 467,476 (712)

ELECT SALES/OTSEGO DEMAND 78,281 505,85287,710 515,045534,277 4 6440.4418 773,456 28,425

282,466 1,602,278 1,602,588 252,393 1,586,9910 1Total For Otsego: 2,419,908 15,288

Rural Big LakeELECT SALES/BIG LAKE RES 19,772 137,04522,339 145,640127,161 (13) (7)440.4421 216,898 (9,884)

ELECT SALES/BL NON-DEMAND 768 2,496642 1,2232,403 96 (4)440.4422 2,573 (93)

22,980 129,564 146,863 20,540 139,541(12) (7)Total For Rural Big Lake: 219,471 (9,976)

DaytonELECT SALES/DAYTON RES 20,381 138,98723,937 147,113132,411 (10) (5)440.4431 220,728 (6,576)

ELECT SALES/DAYTON NON-DEM 3,531 23,1103,902 24,04723,287 (3) 1440.4432 35,950 177

27,840 155,698 171,160 23,913 162,097(9) (4)Total For Dayton: 256,678 (6,399)

Public St & Hwy LightingELECT SALES/ELK RIVER SEC LTS 2,543 20,7954,064 22,78831,216 37 50440.4414 34,317 10,421

ELECT SALES/OTSEGO SEC LTS 763 6,1990 00 0 0440.4419 0 (6,199)

ELECT SALES/BIG LAKE SEC LTS 154 1,2320 00 0 0440.4424 0 (1,232)

ELECT SALES/DAYTON SEC LTS 354 2,8170 00 0 0440.4434 0 (2,817)

PUBLIC ST & HWY LIGHTING/CIT 25,824 204,75626,114 234,027205,886 (12) 1440.4441 352,544 1,130

30,178 237,103 256,815 29,638 235,800(8) 1Total For Public St & Hwy Lighting: 386,861 1,303

Generation and Sub Station CreditSUB-STATION CREDIT 1,168 9,3431,168 9,3449,343 0 0440.4550 14,015 0

45



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

GENERATION CREDIT 1,800 13,6801,780 17,33014,360 (17) 5440.4551 20,160 680

GRE GENERATION - PEAKING PLA 0 5,7570 7,0000 (100) 0470.4720 7,000 (5,757)

2,948 23,703 33,674 2,968 28,780(30) (18)Total For Generation and Sub Station Credit: 41,175 (5,077)

Dispersed Generation CreditDISPERSED GENERATION CREDIT (106,848) (537,264)(100,694) (566,542)(545,586) (4) 2440.4552 (771,008) (8,322)

(100,694) (545,586) (566,542) (106,848) (537,264)(4) 2Total For Dispersed Generation Credit: (771,008) (8,322)

Other Revenue/CIP/Rate Increase/AC CreditRATE INCREASE 0 500,0000 00 0 0440.4554 0 (500,000)

A/C CREDIT (11,088) (32,994)(11,367) (29,967)(34,410) 15 4440.4555 (50,000) (1,416)

(11,367) (34,410) (29,967) (11,088) 467,00615 (107)Total For Other Revenue/CIP/Rate Increase/AC Cred (50,000) (501,416)

Total Operating Revenue2,999,758 20,260,0043,280,482 20,064,56520,433,730 2 130,599,548 173,726

Other Operating Revenue Interest/Dividend Income

INTEREST & DIVIDEND INCOME 7,821 67,9316,969 71,61770,178 (2) 3460.4691 105,000 2,247

6,969 70,178 71,617 7,821 67,931(2) 3Total For Interest/Dividend Income: 105,000 2,247

Customer PenaltiesCUSTOMER DELINQUENT PENALT 18,140 154,35923,513 148,764139,933 (6) (9)470.4701 250,000 (14,426)

23,513 139,933 148,764 18,140 154,359(6) (9)Total For Customer Penalties: 250,000 (14,426)

LFG ProjectLFG PROJECT 92,592 736,50592,762 781,061716,240 (8) (3)470.4721 1,136,812 (20,265)

92,762 716,240 781,061 92,592 736,505(8) (3)Total For LFG Project: 1,136,812 (20,265)

Connection FeesDISCONNECT & RECONNECT CHA 11,150 94,76624,375 44,773102,663 129 8470.4702 125,000 7,897

24,375 102,663 44,773 11,150 94,766129 8Total For Connection Fees: 125,000 7,897

SecuritySECURITY REVENUE 23,547 150,61619,777 180,062164,617 (9) 9470.4700 270,000 14,001

19,777 164,617 180,062 23,547 150,616(9) 9Total For Security: 270,000 14,001

Misc RevenueMISC ELEC REVENUE - TEMP CHG 400 1,0000 1,750600 (66) (40)470.4703 1,000 (400)

STREET LIGHT 0 01,500 04,500 0 0470.4704 0 4,500

NON-UTILITY OPERATIONS 6,562 45,1060 34,48851,101 48 13470.4715 65,000 5,995

MISC NON-UTILITY 4,256 32,9532,393 24,81025,177 1 (24)470.4722 35,000 (7,776)46



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

GAIN ON DISPOSITION OF PROP 18,000 33,0000 03,699 0 (89)470.4723 0 (29,301)

SALES OF MERCHANDISE (268) 4770 0644 0 35470.4724 0 168

RENTAL PROPERTY INCOME 2,060 16,4802,060 14,07616,522 17 0470.4750 24,720 42

5,953 102,244 75,124 31,010 129,01636 (21)Total For Misc Revenue: 125,720 (26,772)

Prior Period Adjustment0 0 0 0 00 0Total For Prior Period Adjustment: 0 0

Total Other Revenue184,260 1,333,193173,348 1,301,4011,295,875 0 (3)2,012,532 (37,318)

173,348 1,295,875 1,301,401 184,260 1,333,1930 (3)Total For Total Other Revenue: 2,012,532 (37,318)

3,184,018 21,593,1963,453,830 21,365,96621,729,605 2 1 Total Revenue 32,612,080 136,408

Expenses Purchased Power

PURCHASED POWER 2,454,045 15,382,3142,544,129 14,887,41814,519,260 (2) (6)540.5551 22,577,733 (863,054)

2,544,129 14,519,260 14,887,418 2,454,045 15,382,314(2) (6)Total For Purchased Power: 22,577,733 (863,054)

Operating & Mtce ExpenseOPERATING SUPERVISION 8,421 47,9497,413 58,49925,484 (56) (47)540.5461 89,342 (22,465)

DIESEL OIL FUEL 3,664 16,4877,893 15,62616,662 7 1540.5471 23,000 175

NATURAL GAS 690 19,1361,112 27,30917,710 (35) (7)540.5472 38,000 (1,426)

STATION PWR & WTR CONSP/PLA 4,217 31,5213,025 35,46323,576 (34) (25)540.5483 50,000 (7,945)

OTHER EXP/PLANT SUPPLIES-ETC 381 3,094593 4,6284,451 (4) 44540.5484 6,000 1,357

MISC OTHER PWR GENERATION E 1,885 8,4871,652 7,3697,994 8 (6)540.5491 13,000 (493)

MAINTENANCE OF STRUCTURE/P 2,680 18,6185,277 21,81228,501 31 53540.5521 32,525 9,883

MTCE OF ENGINES/GENERATORS- 145 10,1883,005 5,01711,528 130 13540.5531 43,555 1,340

MTCE OF PLANT/LAND IMPROVE 1,499 17,7311,432 21,75711,837 (46) (33)540.5541 32,000 (5,895)

31,403 147,743 197,480 23,582 173,212(25) (15)Total For Operating & Mtce Expense: 327,422 (25,469)

Landfill GasLFG PURCHASED GAS (4,065) 104,38513,461 105,488102,752 (3) (2)550.5050 170,000 (1,633)

LANDFILL GAS O&M 63,111 318,92741,613 329,312371,444 13 16550.5051 500,000 52,517

LFG ADMIN 47 94948 6,009764 (87) (19)550.5052 10,000 (185)

LFG INSURANCE 1,385 11,1331,386 10,94211,035 1 (1)550.5053 17,500 (98)

LFG MTCE 0 00 7,317365 (95) 0550.5054 20,000 365

47



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

56,508 486,359 459,068 60,478 435,3946 12Total For Landfill Gas: 717,500 50,965

Transmission ExpenseTRANSMISSION MTCE AND EXPE 0 0472 0472 0 0560.5620 0 472

472 472 0 0 00 0Total For Transmission Expense: 0 472

Distribution ExpenseREMOVE EXISTING SERV & METE 0 941149 133164 23 (83)580.5801 1,000 (777)

TRANSFORMER EX/OVERHD & UN 992 7,646714 8,2123,564 (57) (53)580.5831 11,000 (4,082)

MTCE OF SIGNAL SYSTEMS 200 5100 1,500436 (71) (15)580.5851 1,500 (74)

METER EXP - REMOVE & RESET 79 51765 2,381434 (82) (16)580.5861 4,000 (83)

TEMP SERVICE-INSTALL & REMO 155 1,266247 1,000889 (11) (30)580.5871 1,500 (377)

MISC DISTRIBUTION EXPENSE 14,343 114,36921,059 136,946165,527 21 45580.5881 203,515 51,158

22,234 171,014 150,172 15,769 125,25014 37Total For Distribution Expense: 227,515 45,764

Maintenance ExpenseMTCE OF STRUCTURES 159 3,96792 6,23819,699 216 397590.5911 7,500 15,733

MTCE OF SUBSTATIONS 2,337 12,7611,681 12,31614,604 19 14590.5921 20,000 1,843

MTCE OF SUBSTATION EQUIPME 65 2,2141,404 4,92410,098 105 356590.5922 10,000 7,884

MTCE OF OVERHD LINES/TREE TR 193 65,5990 133,29648,487 (64) (26)590.5931 135,000 (17,113)

MTCE OF OVERHD LINES/STANDB 2,668 16,4822,681 19,19317,370 (9) 5590.5932 30,000 889

MTCE OF OVERHEAD 13,985 70,4966,458 66,883153,828 130 118590.5933 97,120 83,333

MTCE OF UNDERGROUND/DISTRI 4,077 58,087(2,353) 59,85859,942 0 3590.5941 97,525 1,855

LOCATE UNDERGROUND PRIMAR 4,257 16,3092,661 17,42917,969 3 10590.5943 26,000 1,660

MTCE OF LINE TRANSFORMERS 7,529 26,33110,547 28,45329,073 2 10590.5951 35,000 2,742

MTCE OF STREET LIGHTING 3,344 19,84217,571 14,22838,484 170 94590.5961 35,000 18,642

MTCE OF SECURITY LIGHTING 1,024 8,009510 5,7906,760 17 (16)590.5962 12,000 (1,249)

MTCE OF METERS 7,308 54,2546,195 51,98153,569 3 (1)590.5971 85,515 (685)

VOLTAGE COMPLAINTS 1,449 5,408549 5,1714,894 (5) (10)590.5972 8,000 (515)

SALARIES/TRANS & DISTRIBUTIO 3,825 21,9833,578 28,44312,507 (56) (43)590.5981 43,575 (9,476)

ELECTRIC MAPPING 5,161 39,9485,453 49,06051,761 6 30590.5985 67,000 11,813

MTCE OF OVERHEAD SERVICE/2N 915 7,770756 5,2287,395 41 (5)590.5991 13,000 (375)

MTCE OF UNDERGROUND ELEC S (603) 19,6546,362 23,44221,828 (7) 11590.5992 37,020 2,173

LOCATE UNDERGROUND SECOND 3,891 15,2641,979 14,56513,878 (5) (9)590.5993 22,000 (1,386)

TRANSPORTATION EXPENSE 12,265 134,52410,106 105,93495,597 (10) (29)590.5995 166,515 (38,928)

48



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2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

76,231 677,744 652,432 73,849 598,9034 13Total For Maintenance Expense: 947,770 78,841

DepreciationDEPRECIATION 151,595 1,297,181159,760 1,533,3331,272,743 (17) (2)595.8031 2,300,000 (24,437)

159,760 1,272,743 1,533,333 151,595 1,297,181(17) (2)Total For Depreciation: 2,300,000 (24,437)

Interest ExpenseINTEREST ON BONDS/LONG TERM 12,323 125,83210,518 93,28691,786 (2) (27)596.8071 136,360 (34,046)

INTEREST ON DEFEASED BONDS (273) (2,181)(273) (2,184)(2,181) 0 0596.8075 (3,271) 0

AMORTIZATION OF DEBT DISCOU (1,159) (6,955)(1,159) (6,368)(9,273) 46 33597.8281 (9,552) (2,318)

9,086 80,332 84,734 10,891 116,696(5) (31)Total For Interest Expense: 123,537 (36,364)

SecuritySECURITY EXPENSE 16,670 131,44517,867 148,623141,252 (5) 7597.8172 215,000 9,808

17,867 141,252 148,623 16,670 131,445(5) 7Total For Security: 215,000 9,808

Other Operating ExpenseCOST & EXP MERCH JOBBING/ELE 0 00 0365 0 0597.8161 0 365

LOSS ON DISPOSITION OF PROP 0 11,8060 1,3153,623 176 (69)597.8213 20,000 (8,183)

OTHER DONATIONS 401 2,3180 1,8061,389 (23) (40)597.8263 5,000 (929)

DAM MAINTENANCE EXPENSE 0 0114 7,8001,712 (78) 0597.8264 7,800 1,712

INTEREST PD ON METER DEPOSIT 0 1835 65298 358 1,556597.8341 1,000 281

RENTAL PROPERTY EXPENSE 628 5,715144 3,3615,568 66 (3)597.8400 6,000 (147)

293 12,956 14,347 1,029 19,857(10) (35)Total For Other Operating Expense: 39,800 (6,901)

Customer Accounts ExpenseMETER READING EXPENSE 3,107 23,1162,246 22,64325,014 10 8900.9021 35,000 1,898

COLLECTING EXP DISC/RECONNE 1,752 8,8151,105 7,8577,680 (2) (13)900.9030 12,000 (1,135)

CUSTOMER CHECKS RETURNED - (1,388) (1,204)0 1,5010 (100) 0900.9041 1,500 1,204

MISC CUSTOMER ACCTS EXP-CO 12,258 107,20017,502 108,890162,497 49 52900.9051 162,220 55,296

CUST BLGS NOT PD/SENT FOR CO (219) 2,071(408) 44,533922 (98) (55)900.9061 45,000 (1,149)

20,445 196,113 185,424 15,510 139,9986 40Total For Customer Accounts Expense: 255,720 56,114

Administrative & General ExpenseSALARIES/OFFICE & COMMISSION 50,876 299,69844,522 373,520392,396 5 31920.9201 659,295 92,698

TEMPORARY STAFFING 3,029 5,2770 2,6640 (100) 0920.9205 4,000 (5,277)

OFFICE SUPPLIES & EXPENSE 3,193 67,16130,459 70,34699,765 42 49920.9211 110,000 32,604

LT & WATER CONSUMPTION/OFFI 1,750 10,4252,225 13,27911,500 (13) 10920.9212 25,000 1,075

49



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2014AUGUST

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2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

BANK CHARGES (207) 508211 4,2521,905 (55) 275920.9213 4,000 1,396

LEGAL FEES 5,159 18,7651,884 21,91918,114 (17) (3)920.9221 40,000 (651)

AUDITING FEES 0 16,0770 14,40013,421 (7) (17)920.9231 14,400 (2,656)

INSURANCE 14,881 124,49713,213 116,865112,735 (4) (9)920.9241 176,866 (11,763)

UTILITY SHARE DEF COMP 686 40,0040 42,00044,766 7 12920.9260 42,000 4,762

UTIL SH OF MEDICAL/DENTAL/DI 24,525 280,05652,200 347,207324,376 (7) 16920.9261 525,936 44,319

UTILITY SHARE OF PERA 12,516 118,46414,213 131,793133,706 1 13920.9262 192,000 15,241

UTILITY SHARE OF FICA 20,638 124,40114,815 131,276129,655 (1) 4920.9263 192,000 5,254

EMPLOYEES SICK PAY 7,687 51,9415,052 40,84359,083 45 14920.9264 96,768 7,142

EMP VACATION/HOLIDAY PAY 27,748 146,17110,494 133,632137,600 3 (6)920.9266 230,000 (8,571)

CONSERVATION IMP PROGRAM (7,641) 37,8769,880 126,06473,808 (41) 95920.9269 186,454 35,932

ENVIRONMENTAL COMPLIANCE 2,059 16,7082,058 18,78516,176 (14) (3)920.9281 27,000 (532)

CONSULTING FEES 0 1,82424,832 32,64930,143 (8) 1,553920.9291 85,000 28,319

TELEPHONE 1,580 12,9991,942 13,78617,313 26 33920.9301 22,000 4,314

ADVERTISING 0 2,424161 3,7066,025 63 149920.9302 5,500 3,601

DUES & SUBSCRIPTIONS - FEES 9,385 97,6269,127 144,60061,523 (57) (37)920.9303 200,000 (36,103)

TRAVEL EXPENSE 488 620290 5,7587,461 30 1,103920.9304 15,500 6,841

SCHOOLS & MEETINGS 14,916 115,6603,066 119,53080,592 (33) (30)920.9305 177,294 (35,067)

MISC GENERAL EXPENSE (244) (260)0 0(1,720) 0 562920.9306 1,000 (1,460)

240,646 1,770,341 1,908,874 193,024 1,588,923(7) 11Total For Administrative & General Expense: 3,053,013 181,418

Total Expenses(before Operating Transfers)3,016,441 20,009,1733,179,074 20,221,90519,476,330 (4) (3)30,785,010 (532,844)

Operating Transfer Transfer To City For 99 Bond Operating Transfer/Other Funds

TRANSFER TO CITY 3% ER REVEN 81,325 530,73887,007 530,297545,292 3 3597.8262 810,000 14,555

87,007 545,292 530,297 81,325 530,7383 3Total For Operating Transfer/Other Funds: 810,000 14,555

Utilities & Labor DonatedUTILITIES & LABOR DONATED 49,092 354,88344,934 336,334352,842 5 (1)597.8261 515,000 (2,041)

44,934 352,842 336,334 49,092 354,8835 (1)Total For Utilities & Labor Donated: 515,000 (2,041)

Total Operating Transfer130,418 885,621131,941 866,631898,134 4 11,325,000 12,514

131,941 898,134 866,631 130,418 885,6214 1Total For Total Operating Transfer: 1,325,000 12,51450



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

37,160 698,403142,816 277,4301,355,141 388 94 Net Income Profit(Loss) 502,070 656,738

51



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2014YTD

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YTDVARIANCE

2015 ANNUALBUDGET

Water

RevenueOperating Revenue Water Sales

WATER SALES COMM & RES/COM 401,942 1,277,662294,645 1,239,6191,328,649 7 4610.6101 2,193,576 50,987

WATER SALES CITY DONATED 0 01,118 05,719 0 0610.6115 0 5,719

295,762 1,334,368 1,239,619 401,942 1,277,6628 4Total For Water Sales: 2,193,576 56,706

Total Operating Revenue401,942 1,277,662295,762 1,239,6191,334,368 8 42,193,576 56,706

295,762 1,334,368 1,239,619 401,942 1,277,6628 4Total For Total Operating Revenue: 2,193,576 56,706

Other Operating Revenue Interest/Dividend Income

INTEREST & DIVIDEND INCOME 1,955 16,9831,742 14,82917,127 15 1460.4691 26,700 144

OTHER INT/MISC REVENUE 0 740 0389 0 426460.4692 0 315

1,742 17,516 14,829 1,955 17,05718 3Total For Interest/Dividend Income: 26,700 459

Customer PenaltiesCUSTOMER PENALTIES 1,639 10,8633,079 6,36610,587 66 (3)620.6301 15,000 (277)

3,079 10,587 6,366 1,639 10,86366 (3)Total For Customer Penalties: 15,000 (277)

Connection FeesWATER/ACCESS/CONNECTION FE 15,174 158,60754,000 93,568150,340 61 (5)620.6401 150,000 (8,267)

MISC CONNECTION FEES 1,406 13,0207,135 7,25320,620 184 58620.6402 15,000 7,601

61,135 170,960 100,821 16,580 171,62770 0Total For Connection Fees: 165,000 (666)

Misc RevenueRENTAL PROPERTY INCOME 515 4,120515 3,5184,131 17 0470.4750 6,180 11

GAIN ON DISPOSITION OF PROP 0 7,2540 00 0 0620.6323 0 (7,254)

MISCELLANEOUS REVENUE 224 1,8240 1,050286 (73) (84)620.6403 2,500 (1,538)

HYDRANT MAINTENANCE PROGR 0 4,165521 4,6645,929 27 42620.6404 7,000 1,764

CONTRIBUTIONS FROM DEVELOP 0 3,9000 00 0 0620.6405 0 (3,900)

WATER TOWER LEASE 7,382 57,56013,938 57,225101,439 77 76620.6406 88,000 43,878

14,975 111,785 66,457 8,121 78,82468 42Total For Misc Revenue: 103,680 32,962

Restate Beginning Retained Earnings0 0 0 0 00 0Total For Restate Beginning Retained Earnings: 0 0

Total Other Revenue

52



2015AUGUST

2014AUGUST

2015YTD

2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

28,296 278,37080,931 188,473310,848 65 12310,380 32,478

80,931 310,848 188,473 28,296 278,37065 12Total For Total Other Revenue: 310,380 32,478

430,238 1,556,033376,693 1,428,0921,645,216 15 6 Total Revenue 2,503,956 89,184

Expenses Production Expense

MTCE OF STRUCTURES 510 2,5084,739 14,19117,907 26 614700.7021 20,000 15,399

TOWER & GROUNDS INSPECTION 393 2,668441 01,245 0 (53)700.7022 0 (1,422)

5,181 19,152 14,191 903 5,17635 270Total For Production Expense: 20,000 13,977

Pumping ExpenseSUPERVISION 1,132 6,6611,598 13,7583,688 (73) (45)710.7101 20,600 (2,973)

SUPPLIES & EXPENSE 25,178 174,73122,822 162,253154,585 (5) (12)710.7181 250,000 (20,146)

SAMPLING 821 6,0221,508 5,5019,753 77 62710.7182 9,000 3,731

CHEMICAL FEED 4,653 32,7101,926 21,52820,631 (4) (37)710.7183 30,000 (12,079)

MTCE OF ELECT PUMPING EQUIP 393 7470 060 0 (92)710.7201 0 (687)

MTCE OF WELLS 8,506 68,3138,971 90,29266,510 (26) (3)710.7220 125,000 (1,803)

GENERATION 0 120 00 0 0710.7225 0 (12)

SCADA - PUMPING 786 5,4402,213 10,3645,840 (44) 7710.7230 15,000 400

39,037 261,067 303,696 41,470 294,636(14) (11)Total For Pumping Expense: 449,600 (33,569)

Distribution ExpenseMTCE OF WATER MAINS 6,128 27,2691,505 52,27215,617 (70) (43)730.7301 60,000 (11,652)

LOCATE WATER SVC 546 3,241224 5,4152,810 (48) (13)730.7309 7,500 (431)

LOCATE WATER MAIN 304 94065 0588 0 (37)730.7310 0 (352)

MTCE OF WATER SERVICES 3,395 14,709970 034,428 0 134730.7311 0 19,719

WATER METER SERVICE 930 2,259730 3,6784,134 12 83730.7312 5,000 1,875

INSTALL & MTC IRRIG METERS 72 1,13329 4,182715 (83) (37)730.7315 5,000 (418)

MTCE OF CUSTOMERS SERVICE 3,110 20,6202,534 18,38815,270 (17) (26)730.7321 31,000 (5,349)

WATER MAPPING 14 4,9250 2,7106,461 138 31730.7325 18,000 1,535

SCADA - DISTRIBUTION 629 4,594517 01,403 0 (69)730.7330 0 (3,191)

MTCE OF WATER HYDRANTS 4,077 18,5706,404 16,08818,045 12 (3)730.7331 25,000 (524)

MISC WATER EXPENSE/INVENTO 1,078 10,085178 9,3734,747 (49) (53)730.7341 12,000 (5,338)

WAGES/WATER 566 3,331372 01,417 0 (57)730.7391 0 (1,914)

53



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2014AUGUST

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2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

TRANSPORTATION EXPENSE 1,015 7,3101,486 9,8959,276 (6) 27730.7395 15,000 1,966

GENERAL EXP/WATER PERMIT 0 13,2950 14,00011,593 (17) (13)730.7399 14,000 (1,702)

15,014 126,504 136,001 21,865 132,281(7) (4)Total For Distribution Expense: 192,500 (5,777)

DepreciationDEPRECIATION 90,478 720,10493,658 753,336747,185 (1) 4595.8031 1,130,000 27,080

93,658 747,185 753,336 90,478 720,104(1) 4Total For Depreciation: 1,130,000 27,080

Interest ExpenseINTEREST ON BONDS/LONG TERM 6,005 49,4455,450 45,05044,154 (2) (11)596.8071 67,080 (5,291)

INTEREST ON DEFEASED BONDS (68) (545)(68) (544)(545) 0 0596.8075 (818) 0

5,382 43,608 44,506 5,937 48,899(2) (11)Total For Interest Expense: 66,262 (5,291)

Other Operating ExpenseLOSS ON DISPOSITION OF PROP 0 43,6580 7000 (100) 0597.8213 1,000 (43,658)

INTEREST PD ON METER DEPOSIT 0 02 015 0 0597.8341 0 15

RENTAL PROPERTY EXPENSE 157 1,42936 1,4841,392 (6) (3)597.8400 2,500 (37)

2010 GO BONDS AMORT DISCOUN 0 00 (2,184)0 (100) 0750.7581 (3,272) 0

38 1,407 0 157 45,0870 (97)Total For Other Operating Expense: 228 (43,680)

Customer Accounts ExpenseMETER READING EXPENSE 519 2,481250 4,6921,098 (77) (56)900.9021 7,000 (1,384)

COLLECTING EXP DISC/RECONNE 290 1,4370 4,3360 (100) 0900.9030 6,500 (1,437)

MISC CUSTOMER ACCTS EXP-CO 3,653 29,3554,197 28,59441,012 43 40900.9051 45,000 11,657

CUST BLGS NOT PD/SENT FOR CO 0 1410 95311 (99) (92)900.9061 1,000 (130)

4,447 42,121 38,575 4,463 33,4159 26Total For Customer Accounts Expense: 59,500 8,705

Administrative & General ExpenseSALARIES/OFFICE & COMMISSION 11,203 67,89810,432 80,42792,063 14 36920.9201 141,000 24,165

TEMPORARY STAFFING 757 1,3190 1,3360 (100) 0920.9205 2,000 (1,319)

OFFICE SUPPLIES & EXPENSE 819 13,3221,727 24,72320,949 (15) 57920.9211 35,000 7,627

LT & WATER CONSUMPTION/OFFI 437 2,6060 2,6552,319 (13) (11)920.9212 5,000 (287)

BANK CHARGES 61 50653 631501 (21) (1)920.9213 1,000 (5)

LEGAL FEES 225 2,236642 3,8022,121 (44) (5)920.9221 5,500 (115)

AUDITING FEES 0 4,0190 3,5993,355 (7) (17)920.9231 3,600 (664)

INSURANCE 2,259 19,5041,862 30,93817,478 (44) (10)920.9241 44,216 (2,026)

UTILITY SHARE DEF COMP 0 9,8300 010,496 0 7920.9260 0 666

54



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2014YTD

2015 YTD



YTDVARIANCE

2015 ANNUALBUDGET

UTIL SH OF MEDICAL/DENTAL/DI 10,322 90,74317,007 80,13998,157 22 8920.9261 121,423 7,414

UTILITY SHARE OF PERA 1,052 13,1531,328 25,32114,420 (43) 10920.9262 32,007 1,267

UTILITY SHARE OF FICA 2,524 14,8481,809 16,18715,175 (6) 2920.9263 23,083 327

EMPLOYEES SICK PAY 1,538 12,4571,090 10,72113,383 25 7920.9264 24,162 926

EMP VACATION/HOLIDAY PAY 5,689 35,4392,395 25,58549,664 94 40920.9266 46,535 14,225

MISCELLANEOUS - WELLHEAD P 0 5970 8,931516 (94) (14)920.9268 9,064 (82)

CONSERVATION IMP PROGRAM 1,115 6,811387 7,9763,462 (57) (49)920.9269 10,000 (3,350)

ENVIRONMENTAL COMPLIANCE 48 45350 536119 (78) (74)920.9281 750 (334)

CONSULTING FEES 0 3440 10,0000 (100) 0920.9291 10,000 (344)

TELEPHONE 394 3,242469 3,2004,283 34 32920.9301 5,100 1,041

ADVERTISING 0 2,8740 5,2723,164 (40) 10920.9302 5,272 290

DUES & SUBSCRIPTIONS - FEES 7,990 25,8397,973 28,50732,435 14 26920.9303 39,249 6,595

TRAVEL EXPENSE 0 (1)73 1711,408 723 (140,900)920.9304 2,500 1,409

SCHOOLS & MEETINGS 1,875 14,7431,007 14,91812,278 (18) (17)920.9305 23,479 (2,465)

MISC GENERAL EXPENSE 0 440 03 0 (93)920.9306 500 (41)

48,301 397,750 385,575 48,307 342,8293 16Total For Administrative & General Expense: 592,440 54,921

Total Expenses(before Operating Transfers)213,579 1,622,428211,059 1,675,8801,638,794 (2) 12,510,530 16,366

Operating Transfer Transfer To City For 99 Bond

TRANSFER TO CITY FOR 99 BOND 0 25,0000 30,00030,000 0 20597.8260 30,000 5,000 Operating Transfer/Other Funds Operating Transfer From City Utilities & Labor Donated

WATER AND LABOR DONATED 0 01,118 3365,719 1,602 0597.8261 500 5,719 Total Operating Transfer

0 25,0001,118 30,33635,719 0 4330,500 10,719

1,118 35,719 30,336 0 25,00018 43Total For Total Operating Transfer: 30,500 10,719

216,658 (91,395)164,517 (278,124)(29,296) (89) (68) Net Income Profit(Loss) (37,074) 62,098

55

of 1

UTILITIES COMMISSION MEETING

TO:

Elk River Municipal Utilities Commission

John Dietz – Chair

Al Nadeau – Vice Chair

Daryl Thompson – Trustee

FROM:

Tom Sagstetter – Conservation and Key Accounts

Manager

MEETING DATE: October 13, 2015

AGENDA ITEM NUMBER: 4.1

SUBJECT:

Electric Service Territory Update

BACKGROUND:

Updates relating to the electric service territory transfer from Connexus Energy.

DISCUSSION:

Area 1a Recap - On September 22, approximately 300 customers were transferred from

Connexus to ERMU. The outage was minimal and went extremely well. Meters were

changed out within the week. Meter reading was done in October and the data migration

and meter reading data looks to very accurate.

Electric Rates – Dave Berg of Dave Berg Consulting, LLC worked with staff to analyze

ERMU’s options to address differences from Connexus Energy in the demand tariff

philosophies. ERMU’s rate is more demand focused and Connexus’ rate is more energy

focus. Dave Berg and staff developed a short term solution and a long term plan. Staff

looks to discuss the proposed short and long term plan and have commission approval for

action.

Area 1b Update – This area is scheduled to be acquired on October 13 at 9:00am.

Approximately 600 customers will be transferred.

ACTION REQUESTED:

Staff requests discussion and action on the proposed temporary demand reduction.

ATTACHMENTS:

Retail Demand Rate Credit Report – Dave Berg Consulting, LLC. – September 22, 2015

56

September 22, 2015

To: Elk River Municipal Utilities From: Dave Berg Consulting Subject: Retail Demand Rate Credit Background Elk River Municipal Utilities (ERMU) is undertaking a series of service territory acquisitions from the surrounding rural electric cooperative. ERMU charges a retail demand and energy rate to all retail customers larger than 50 kW. The cooperative charges retail demand and energy rates to all customers greater than 25 kW. Both ERMU and the cooperative bill demand on a seasonal basis with higher demand rates in the summer. The effective ERMU demand rate based on total demand revenue and retail demand billing units is $13.50/kW. The cooperative’s effective total demand rate is estimated to be $9.00/kW. ERMU is interested in addressing this demand rate differential as these customers transition to becoming ERMU customers. Any rate adjustments made for these new customers would also apply to ERMU’s existing demand and large demand customers. ERMU’s retail demand charge is approximately $4.50/kW higher than the cooperative’s. However, including power cost adjustments, ERMU’s energy rate for demand customers is $0.006/kWh lower than the cooperative’s. This lower energy rate partially compensates for the higher demand rate. An average ERMU demand customer has a 60% monthly load factor. A 60% load factor customer uses 438 kWh per month for each 1 kW of demand. The lower ERMU energy rate would save an average demand customer $2.63 (438 kWh x 0.006) per kW of demand. This reduces the average demand difference between ERMU and the cooperative to $1.87/kW ($4.50 less $2.63). There are two other drivers that need to be considered when determining the rate impacts on the demand billed customers that are being acquired. The first is that ERMU does not charge for power factor correction. The cooperative charges the applicable monthly demand rate on billed kW and not measured kW. The billed kW is used when the customer’s average power factor is less than 90 percent. For customers with a power factor less than 90 percent, their bill under the cooperative’s rate will be adjusted higher but this adjustment does not occur under the ERMU rate. The second driver is some smaller customers will experience a change from the Demand Electric Service customer class to the Non-Demand Electric Service customer class. Customers that have demand between 25 kW and 49 kW will, in general, see energy cost benefits as a result of not having to pay demand or power factor correction charges. ERMU is considering temporarily lowering the demand portion of the demand and large demand retail rates. For example, a $2.00 reduction in the retail demand rate for 2016 would make the effective retail rates for ERMU and the cooperative more comparable for most demand billed customers. Based on current ERMU demand customers, this demand reduction would result in a reduction in annual revenue of approximately $761,500, or 2.4% of ERMU’s total annual revenues. ERMU plans to cover this deficit

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from existing reserve funds. Any reductions after 2016 would be dependent on overall ERMU financials, continued discrepancies between ERMU and cooperative rates and ERMU sales growth. ERMU currently purchases its wholesale power requirements from Great River Energy (GRE). In 2018, ERMU is transitioning to a new wholesale supplier, the Minnesota Municipal Power Agency (MMPA). MMPA’s wholesale rate structure is different than GRE’s relative to overall demand and energy rates. ERMU is anticipating that overall wholesale costs will be lower and fixed (demand) wholesale costs will also be lower under MMPA service. ERMU is also planning to conduct an electric cost-of-service and rate design study in the near future. The results of a cost-of-service study will help address rate design considerations for all ERMU customers including the demand billed customers. It is anticipated that a cost-of-service analysis will consider both the existing GRE wholesale structure and the planned MMPA wholesale structure to examine how the cost basis for ERMU customers will change with the transition of wholesale providers. The cost-of-service results will also provide useful information relative to continued adjustments to the retail demand rates. Recommendations Elk River Municipal Utilities (ERMU) is evaluating a demand rate adjustment rate mechanism which will utilize a monthly demand adjustment (either a credit or charge) for the demand billed customer class. The demand adjustment mechanism will allow ERMU to make any additional future adjustments that may be warranted without having to change the Demand Electric Service tariff repeatedly to respond to changing conditions. The monthly demand adjustment would be very similar to the Power Cost Adjustment (PCA) mechanism that is currently charged or credited per kWh of energy. The nature of the adjustments and the impact on bills will need to be communicated to existing and acquired ERMU customers in the Demand Electric Service customer classes. It will be important that the customers understand that the demand adjustment will be temporary in nature and part of the transition in the acquisition of service territory and the change to a new wholesale power supplier in 2018. Customers will also need to understand that the rates will be further adjusted as necessary in the future to maintain ERMU’s financial standing and reflect ERMU’s cost basis.

David A. Berg, PE Principal Dave Berg Consulting, LLC

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TO:





FROM:

Troy Adams, P.E. – General Manager



SUBJECT:

Payment in Lieu of Taxes (PILOT) and Other Donations to the City of Elk River

BACKGROUND:

Minnesota municipal utilities do not pay taxes to their city. It is very typical for the utility to

provide a payment in lieu of taxes (PILOT). ERMU has a policy which outlines the details of the

PILOT and other donations to the City of Elk River. This policy is reviewed at least once every

five years; the last policy changes were made on July 2, 2013.

DISCUSSION:

Delay for PILOT for Electrical Service Territory Transfer

On September 8, the commission reviewed proposed changes to the PILOT Policy that would

delay PILOT for the areas acquired from Connexus Energy through the March 20, 2015,

electric service territory transfer agreement. The PILOT was proposed to be delayed for each

customer acquired until the loss of revenue (LOR) payments that are outlined in the

agreement would complete. These LOR payments are made for 10 years after the acquisition

with a few exceptions for municipal development.

The commission discussed the proposed policy revisions and directed staff to strengthen the

language to be specific to the March 20, 2015, electric service territory transfer agreement.

This would eliminate any confusion regarding PILOT for LOR payments related to previous

acquisitions. The proposed policy has been updated to reflect the commission’s request.

Shift of Policy Mechanics from Donated Electricity to PILOT

The current PILOT Policy outlines in section 3.0 Donated Electricity stating that ERMU

“shall donate all electricity to the City of Elk River for all of their facilities not associated

with enterprise funds of the City of Elk River.” The administrative process associated with

this donation is extremely burdensome. Due to its manual nature, this process is also subject

to human and keying errors.

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Since the September meeting, staff have had discussions with the City about an option to

maintain the level of donation to the city and reduce the administration burden and risk for

error. ERMU and city staff have been evaluating increasing the PILOT percentage

contribution from 3% to 4%, and eliminating the donated electricity not associated with street

lights and signal lights. An analysis of the donated electricity, less the usage by street and

signal lights, is equivalent to 0.8% of revenue generated from electric sales for Elk River

customers. An increase in the PILOT of 1% with an offsetting reduction for the elimination

of donated electricity (with the exception of street and signal lights) would nearly be a cash

neutral policy change. The city would be seeing an increased expense because they would be

billed the electric usage, but the City would also have an offsetting source of revenue in

excess of the increased expense by approximately $38,000 based on projected 2015 sales

numbers.

For ERMU, this change would eliminate significant staff time to record and post these

donations through the billing system and the general ledger. It would also give a more

transparent representation of the actual costs of the City facilities. As ERMU grows within

the corporate boundaries of the City of Elk River, the additional increase in revenues will be

further increased with the 1% change to the PILOT, resulting in additional funds contributed

to the City. It is extremely likely that ERMU’s growth in sales will be a higher rate than the

growth of city government and the growth in city facility electric usage. This change is near

cash neutral for the City now, but will result in increased PILOT for the future.

Due to the 2016 budget approval process, utilities and city staff agree that a January 1, 2016,

implementation is better. However, to allow city staff to incorporate this proposed change

into their budget, staff looks to get commission approval immediately. This proposed

revision is attached separately and reflects the policy change proposed for October 13, 2015.

ACTION REQUESTED:

Staff recommends the Commission adopt effective immediately the policy revisions to

“ERMU Policy 8.13 – Payment in Lieu of Taxes (PILOT) and Other Donations to the

City of Elk River” which reflects a delay for PILOT related to the March 20, 2015,

electric service territory transfer agreement.

Staff recommends the Commission adopt the second proposed policy language change to

be effective January 1, 2016, which will result in a shift in policy mechanics increasing

the PILOT from 3% to 4% and eliminating the donation of electricity with the exception

of street and signal lights.

ATTACHMENTS:

Proposed October 13, 2015, revision to ERMU Policy 8.13 – Payment in Lieu of Taxes

(PILOT) and Other Donations to the City of Elk River

Proposed January 1, 2016, revision to ERMU Policy 8.13 – Payment in Lieu of Taxes

(PILOT) and Other Donations to the City of Elk River

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8.13 Payment in Lieu of Taxes

(PILOT) and other Donations to the

City of Elk River

Page 1 of 2 Adopted December 6, 1994

Revised June 6, 2008

Revised July 2, 2013

Proposed Rev Oct 13, 2015

8.13 PAYMENT IN LIEU OF TAXES (PILOT) AND OTHER DONATIONS TO

THE CITY OF ELK RIVER

1.0 Purpose and Summary

The success of ERMU is linked with the success of our community. And the success of our

community is linked with the operation of our city government and ERMU. ERMU was

purchased by the City of Elk River in 1945 and separate governance was created per State

Statute in 1947. Although governed separately, ERMU is still an important component of our

local government and our city services.

It is typical for a municipal utility to provide a Payment in Lieu of Taxes (PILOT) and other

donations to their city, regardless of a separation of governance. Although typical, this

contribution should never inhibit ERMU’s ability to make repayment on debt, cause ERMU to

become non-competitive, or inhibit needed investment in personnel or infrastructure which may

hurt ERMU’s ability to meet the needs of their customers. For these reasons the PILOT and

other donations should be reviewed at least once every five (5) years by the ERMU Commission.

2.0 Payment in Lieu of Taxes (PILOT)

The PILOT transfer from Elk River Municipal Utilities to the City of Elk River shall be three

percent (3%) of the revenues generated by ERMU’s electric customers within the corporate

boundaries of the City of Elk River which are not subject to a loss of revenue payment resulting

from the March 20, 2015, electric service territory transfer agreement with Connexus Energy.

3.0 Donated Electricity

Elk River Municipal Utilities shall donate all electricity to the City of Elk River for all of their

facilities not associated with enterprise funds of the City of Elk River. As an example, this will

include buildings such as City Hall, Police and Fire Departments, Library, Park, Street

61



City of Elk River




Proposed Rev Oct 13, 2015

Department Buildings, street lights, and signal lights; this shall not include such buildings as

Liquor Stores, Wastewater Treatment Plant, Ice Arena, or lift stations.

4.0 Donated Water

Elk River Municipal Utilities shall donate water for use by the Elk River Fire Department

(ERFD) for the purpose of extinguishing fires within the City of Elk River and other cities under

contract with the ERFD.

For the purpose of creating ice rinks for public/ non-enterprise use, ERMU shall donate water for

use by the Elk River Parks Department.

Elk River Municipal Utilities shall donate water for the use by the Elk River Streets Department

for the use of street sweeping.

5.0 Donated Labor

Because of specialized skills and equipment, ERMU may be able to provide a better value to our

community by donating labor to the City of Elk River. For example, ERMU has trained

employees and the equipment to hang banners where the City does not. In this example, ERMU

is able to provide this donated service to the City for less cost than a third party, creating greater

value to our community. For such situations, ERMU shall donate labor to the City of Elk River,

as appropriate, where a greater value is created for our community and where ERMU is not

subjected to undue burden.

In addition to hanging banners, other examples include: maintenance of street lighting, relamping

signal lights, locating underground fiber optics and/or other facilities, administration costs

associated with the billing of city franchise fees, installation of temporary lighting, relamping of

city ball field lighting, installation and/or maintenance of city warning sirens, meter reading for

wastewater, assistance with tree trimming, etc…

62



City of Elk River




*Revised October 13, 2015

Proposed Rev Jan 1, 2016

8.13 PAYMENT IN LIEU OF TAXES (PILOT) AND OTHER DONATIONS TO

THE CITY OF ELK RIVER

1.0 Purpose and Summary

The success of ERMU is linked with the success of our community. And the success of our

community is linked with the operation of our city government and ERMU. ERMU was

purchased by the City of Elk River in 1945 and separate governance was created per State

Statute in 1947. Although governed separately, ERMU is still an important component of our

local government and our city services.

It is typical for a municipal utility to provide a Payment in Lieu of Taxes (PILOT) and other

donations to their city, regardless of a separation of governance. Although typical, this

contribution should never inhibit ERMU’s ability to make repayment on debt, cause ERMU to

become non-competitive, or inhibit needed investment in personnel or infrastructure which may

hurt ERMU’s ability to meet the needs of their customers. For these reasons the PILOT and

other donations should be reviewed at least once every five (5) years by the ERMU Commission.

2.0 Payment in Lieu of Taxes (PILOT)

The PILOT transfer from Elk River Municipal Utilities to the City of Elk River shall be three

percent (34%) of the revenues generated by ERMU’s electric customers within the corporate

boundaries of the City of Elk River which are not subject to a loss of revenue payment resulting

from the March 20, 2015, electric service territory transfer agreement with Connexus Energy.

3.0 Donated Electricity

Elk River Municipal Utilities shall donate all electricity to the City of Elk River for all of their

facilities not associated with enterprise funds of the City of Elk River. As an example, this will

include buildings such as City Hall, Police and Fire Departments, Library, Park, Street

63



City of Elk River




*Revised October 13, 2015

Proposed Rev Jan 1, 2016

Department Buildings, street lights, and signal lights.; this shall not include such buildings as

Liquor Stores, Wastewater Treatment Plant, Ice Arena, or lift stations.

4.0 Donated Water

Elk River Municipal Utilities shall donate water for use by the Elk River Fire Department

(ERFD) for the purpose of extinguishing fires within the City of Elk River and other cities under

contract with the ERFD.

For the purpose of creating ice rinks for public/ non-enterprise use, ERMU shall donate water for

use by the Elk River Parks Department.

Elk River Municipal Utilities shall donate water for the use by the Elk River Streets Department

for the use of street sweeping.

5.0 Donated Labor

Because of specialized skills and equipment, ERMU may be able to provide a better value to our

community by donating labor to the City of Elk River. For example, ERMU has trained

employees and the equipment to hang banners where the City does not. In this example, ERMU

is able to provide this donated service to the City for less cost than a third party, creating greater

value to our community. For such situations, ERMU shall donate labor to the City of Elk River,

as appropriate, where a greater value is created for our community and where ERMU is not

subjected to undue burden.

In addition to hanging banners, other examples include: maintenance of street lighting, relamping

signal lights, locating underground fiber optics and/or other facilities, administration costs

associated with the billing of city franchise fees, installation of temporary lighting, relamping of

city ball field lighting, installation and/or maintenance of city warning sirens, meter reading for

wastewater, assistance with tree trimming, etc…

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TO:





FROM:




SUBJECT:

Expansion of the Elk River Municipal Utilities Board of Commissioners

BACKGROUND:

Shortly after the Village of Elk River purchased Elk River Power & Light, the council by the provision of

Minnesota Statute 412.331 created through resolution the Water, Light, Power and Building Commission.

This commission is now the Elk River Public Utilities Commission with responsibility for the municipal

electric and water departments. The commission’s membership is in accordance with Statue 412.341

“consisting of three members appointed by council.”

At the September 8 utilities commission meeting, staff was directed to present a proposed expansion of

the commission membership to the city council.

DISCUSSION:

A presentation was made at the October 5 city council meeting. Council supported the proposal for

expansion and discussed the number of council membership allowable on the commission. The council

approved action for legislation to expand the utilities commission up to five members; And Upon

expansion to five members, no more than two commissioners could come from council membership.

Minnesota Municipal Utilities Association (MMUA) helped draft language for legislation consistent with

commission and council direction. This language is attached. Contingent upon commission approval, this

language will be taken back to council for approval. Once both governing bodies have reviewed and

approved the attached language, MMUA and staff will work with our local Representative Nick Zerwas

to have the language taken to the Revisor’s office to draft the proposed legislation.

ACTION REQUESTED:

Staff requests Commission approve the proposed language for an expansion of the utilities commission.

ATTACHMENTS:

Proposed – Elk River Public Utilities Commission Expanded to Five Commissioners

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Elk River Public Utilities Commission Expanded to Five Commissioners

Notwithstanding Minnesota Statutes, section 412.341, subdivision 1, the city of Elk River may

increase the membership of the city’s public utilities commission to five members. Upon expansion to

five members, no more than two members may be chosen from the council membership. Terms for the

additional members shall be staggered and made in accordance with the bylaws governing the utilities

commission.

EFFECTIVE DATE: LOCAL APPROVAL. This section is effective the day after the governing body of

the city of Elk River and its chief clerical officer complete in timely fashion their compliance with

Minnesota Statutes, section 645.021, subdivisions 2 and 3.

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TO:





FROM:

Mike O’Neill – Technical Services

Superintendent

MEETING DATE: October 13

th, 2015


SUBJECT: Environmental Pollution Agency Rules affecting ERMU’s Diesel Generation Facility

BACKGROUND:

In preparation for the 2016 power contract with Great River Energy (GRE) in regards to the

Diesel Engine Power Plant; I have been working with vendors/contractors to assess the need and

cost of retrofitting and upgrading the exhaust systems for our #3 and #4 generators to bring them

into compliance with new EPA regulations.

UPDATE:

The following information is submitted for your review:

1. Elk River Municipal Utilities (ERMU) is still in the process of deciding whether to

upgrade the exhaust systems to bring them into compliance at a cost of approximately

$400,000 or to forgo placing them on the in the MISO market with GRE and keep the

assets to be used for emergency use only.

2. If at a later time ERMU decides to bring these engines online in the MISO market, the

engines will have to be brought into compliance with the rules at that time.

3. ERMU is still receiving quotes from vendors and anticipates having a decision made

prior to the December 31st of this year. Staff is meeting with our future power provider

and our current power provider in accessing this situation.

ACTION REQUESTED: No action requested.

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TO:





FROM:

Theresa Slominski – Finance and Office

Manager



SUBJECT:

2016 Water and Electric Expense Budgets

BACKGROUND:

In preparation for submittal in November, staff continues to work through the 2016 budget

process. The first cut of the expense portion of the 2016 budget has been completed for

commission review. The expense budget will change as the complete 2016 budget is assembled

and the finalized wholesale power costs are reflected. Revenues and rate increases for 2016 will

be presented in November.

DISCUSSION:

Attached is the following information for your review. Additional budget detail is available upon

request. Please contact staff for additional information.

1. Water Department Expense Budget – The 2016 forecast for water expenses are a 2.37%

increase over the current year budget. There are some re-distributions of the various

labor accounts and so the comparisons are more difficult to use but there are notes in the

margins to help identify where the differences are, as well as some explanations for

notable items.

Using budgeted revenue from 2015, without any water rate increase or adjustment for

new services, the water department would see a potential loss of ($96,000) or -3.69%

margin. As numbers are finalized, and revenue projected, this will be brought back in

November.

2. Electric Department Expense Budget – The 2016 forecast for electric expenses are a

2.78% increase over the current year budget. Wholesale power costs make up between

70-75% of the operating budget, and including the power costs, the increase is 2.94%

Ultimately, the wholesale rates set by Great River Energy (GRE) have an enormous

impact on ERMU’s rates. GRE has not finalized their 2016 wholesale power rates, and

we estimated a 3% increase, based on current usage. We still will need to factor in

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growth related to new construction and territory acquisition and final wholesale power

cost increases. The final GRE board approval of wholesale power rates usually comes by

early December. Typically, there is some adjustment of the rate structure and that may

impact us more than 3%. This will need to be adjusted prior to final budget approval.

Similar to the water expense budget, this draft does not reflect any increase in ERMU

electric rates. Without any electric rate increase, the electric department would see a

potential loss of $437,071 or -1.3% margin. In the recent past we have designed for a

1.5% margin. There is new growth and territory acquisition to include on the revenue

side as well and using last year’s number is not appropriate, but it does provide a

baseline. The rate design will be completed for the November meeting.

ATTACHMENTS:

Proposed 2016 Electric Expense Budget

Proposed 2016 Water Expense Budget

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Electric

GL DivGL Acct Description 2014 Actual 2015 Budget 2016 Budget Notes and Explanations

Operations 61 - Elk River Electric540.5461 OPERATING SUPERVISION 54,812.00 89,342.00 151,000.00 Allocations different for 2016 for Elect Supt, Asst Elect Supt (new), Tech Serv Supt, GM

61 - Elk River Electric540.5471 DIESEL OIL FUEL 23,509.78 23,000.00 25,000.00

61 - Elk River Electric540.5472 NATURAL GAS 25,370.56 38,000.00 40,000.00

61 - Elk River Electric540.5483 STATION PWR & WTR CONSP/PLANT 47,630.87 50,000.00 50,000.00

61 - Elk River Electric540.5484 OTHER EXP/PLANT SUPPLIES-ETC 4,543.29 6,000.00 6,500.00

61 - Elk River Electric540.5491 MISC OTHER PWR GENERATION EXP 11,686.79 13,000.00 14,000.00

61 - Elk River Electric540.5521 MAINTENANCE OF STRUCTURE/PLANT 32,885.75 32,525.00 44,000.00

61 - Elk River Electric540.5531 MTCE OF ENGINES/GENERATORS-PL 6,023.46 43,555.00 35,000.00

61 - Elk River Electric540.5541 MTCE OF PLANT/LAND IMPROVEMENT 30,806.18 32,000.00 30,000.00

Total Operations 237,268.68 327,422.00 395,500.00

Purchased Power 61 - Elk River Electric540.5551 PURCHASED POWER 21,994,651.58 22,577,733.11 23,255,065.00 Amount to be determined with finalization of GRE budget *

Total Purchased Power 21,994,651.58 22,577,733.11 23,255,065.00

Landfill Gas Plant 61 - Elk River Electric550.505 LFG PURCHASED GAS 154,739.00 170,000.00 170,000.00

61 - Elk River Electric550.5051 LANDFILL GAS O&M 445,175.79 500,000.00 500,000.00

61 - Elk River Electric550.5052 LFG ADMIN 21,516.53 10,000.00 10,000.00

61 - Elk River Electric550.5053 LFG INSURANCE 16,671.84 17,500.00 17,500.00

61 - Elk River Electric550.5054 LFG MTCE 3,205.03 20,000.00 20,000.00

Total Landfill Gas Plant 641,308.19 717,500.00 717,500.00

Transmission 61 - Elk River Electric560.562 TRANSMISSION MTCE AND EXPENSE new 0.00 0.00 15,000.00 New account for better recording of transmission expenses for MISO reporting

Total Transmission 0.00 0.00 15,000.00

Distribution 61 - Elk River Electric580.5801 REMOVE EXISTING SERV & METERS 941.25 1,000.00 2,000.00

61 - Elk River Electric580.5821 SCADA EXPENSES 4,718.39 5,000.00 5,500.00

61 - Elk River Electric580.5831 TRANSFORMER EX/OVERHD & UNDERG 13,949.57 11,000.00 32,200.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric580.5851 MTCE OF SIGNAL SYSTEMS 1,324.39 1,500.00 1,500.00

61 - Elk River Electric580.5861 METER EXP - REMOVE & RESET 618.28 4,000.00 4,000.00

61 - Elk River Electric580.5871 TEMP SERVICE-INSTALL & REMOVE 2,910.46 1,500.00 1,500.00

61 - Elk River Electric580.5881 MISC DISTRIBUTION EXPENSE 167,199.41 203,515.00 280,000.00 Increased costs assumed for new territory acquisition

Total Distribution 191,661.75 227,515.00 326,700.00

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Maintenance 61 - Elk River Electric590.5911 MTCE OF STRUCTURES 4,947.95 7,500.00 10,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5921 MTCE OF SUBSTATIONS 18,590.12 20,000.00 25,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5922 MTCE OF SUBSTATION EQUIPMENT 8,663.42 10,000.00 25,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5931 MTCE OF OVERHD LINES/TREE TRIM 72,118.56 135,000.00 100,000.00 Redistribution of labor with new territory acquisition

61 - Elk River Electric590.5932 MTCE OF OVERHD LINES/STANDBY 25,145.48 30,000.00 30,000.00

61 - Elk River Electric590.5933 MTCE OF OVERHEAD 127,049.18 97,120.00 120,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5941 MTCE OF UNDERGROUND/DISTRIB 71,285.65 97,525.00 80,000.00 Redistribution of labor with new territory acquisition

61 - Elk River Electric590.5943 LOCATE UNDERGROUND PRIMARY 24,576.57 26,000.00 25,000.00

61 - Elk River Electric590.5951 MTCE OF LINE TRANSFORMERS 40,452.55 35,000.00 45,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5961 MTCE OF STREET LIGHTING 53,148.40 35,000.00 40,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5962 MTCE OF SECURITY LIGHTING 9,357.64 12,000.00 12,000.00

61 - Elk River Electric590.5971 MTCE OF METERS 84,972.46 85,515.00 95,000.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric590.5972 VOLTAGE COMPLAINTS 6,873.89 8,000.00 8,000.00

61 - Elk River Electric590.5981 SALARIES/TRANS & DISTRIBUTION 25,235.61 43,575.00 45,000.00 Allocations different for 2016 for Elect Supt, Asst Elect Supt (new), Tech Serv Supt, GM

61 - Elk River Electric590.5985 ELECTRIC MAPPING 57,725.96 67,000.00 105,000.00 Includes increased costs for Engineer position, allocation different for Tech Serv Supt

61 - Elk River Electric590.5991 MTCE OF OVERHEAD SERVICE/2NDRY 10,233.18 13,000.00 11,000.00 Redistribution of labor with new territory acquisition

61 - Elk River Electric590.5992 MTCE OF UNDERGROUND ELEC SERV 9,776.57 37,020.00 37,000.00

61 - Elk River Electric590.5993 LOCATE UNDERGROUND SECONDARY 21,832.81 22,000.00 18,000.00 Redistribution of labor with new territory acquisition

61 - Elk River Electric590.5995 TRANSPORTATION EXPENSE 197,533.68 166,515.00 175,000.00 2014 high - Increased costs assumed for new territory acquisition

Total Maintenance 869,519.68 947,770.00 1,006,000.00

Depreciation 61 - Elk River Electric595.8031 DEPRECIATION 1,914,061.50 2,300,000.00 2,300,000.00

Total Depreciation 1,914,061.50 2,300,000.00 2,300,000.00

Other Exp 61 - Elk River Electric596.8071 INTEREST ON BONDS/LONG TERM 175,122.90 136,360.00 114,540.00 Per bond contracts, lower interest 2016

61 - Elk River Electric596.8075 INTEREST ON DEFEASED BONDS -3,271.20 -3,271.00 -3,370.00 Per bond contracts

61 - Elk River Electric597.8172 SECURITY EXPENSE 198,128.27 215,000.00 215,000.00

61 - Elk River Electric597.8213 LOSS ON DISPOSITION OF PROP 3,475.49 20,000.00 15,000.00

61 - Elk River Electric597.8261 UTILITIES & LABOR DONATED 530,339.75 515,000.00 232,000.00 2016 no longer donate electric services, increase contribution 1% instead

61 - Elk River Electric597.8262 TRANSFER TO CITY 4% ER REVENUE 797,835.34 810,000.00 1,095,000.00 2016 no longer donate electric services, increase contribution from 3% to 4% instead *

61 - Elk River Electric597.8263 OTHER DONATIONS 4,782.25 5,000.00 5,000.00

61 - Elk River Electric597.8264 DAM MAINTENANCE EXPENSE 91.70 7,800.00 0.00 Moved to water budget

61 - Elk River Electric597.8281 AMORTIZATION OF DEBT DISCOUNT -11,591.80 -11,592.00 -14,328.00 Per bond contracts

61 - Elk River Electric597.8341 INTEREST PD ON METER DEPOSITS 431.15 1,000.00 1,000.00

61 - Elk River Electric597.84 RENTAL PROPERTY EXPENSE 6,335.06 6,000.00 6,000.00

Total Other Exp 1,701,678.91 1,701,297.00 1,665,842.00

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Customer Exp 61 - Elk River Electric900.9021 METER READING EXPENSE 35,123.24 35,000.00 41,700.00 Increased costs assumed for new territory acquisition

61 - Elk River Electric900.903 COLLECTING EXP DISC/RECONNECT 12,206.85 12,000.00 12,000.00

61 - Elk River Electric900.9051 MISC CUSTOMER ACCTS EXP-COMP 244,269.86 162,220.00 240,000.00 2014 incl Paymentus term $78k, Increased costs for full year of NISC software 2016

61 - Elk River Electric900.9061 CUST BLGS NOT PD/SENT FOR COLL 2,926.12 45,000.00 45,000.00

Total Customer Exp 294,526.07 254,220.00 338,700.00

Admin & General 61 - Elk River Electric920.9201 SALARIES/OFFICE & COMMISSION 537,658.20 659,295.17 691,000.00 Increased for staff positions filled in 2015 (addtl CSR, addtl Acct, filled Billing Specialist)

61 - Elk River Electric920.9201 TEMPORARY STAFFING 13,579.68 4,000.00 4,000.00 2014 high for Purchasing Specialist assistance

61 - Elk River Electric920.9211 OFFICE SUPPLIES & EXPENSE 108,493.16 110,000.00 114,000.00

61 - Elk River Electric920.9212 LT & WATER CONSUMPTION/OFFICE 21,602.88 25,000.00 24,000.00

61 - Elk River Electric920.9213 BANK CHARGES 1,267.46 4,000.00 4,000.00

61 - Elk River Electric920.9221 LEGAL FEES 29,420.14 40,000.00 25,000.00 2015 was higher for territory acquisition

61 - Elk River Electric920.9231 AUDITING FEES 16,077.10 14,400.00 14,400.00

61 - Elk River Electric920.9241 INSURANCE 197,140.29 176,865.60 177,000.00 2014 paid $20k unemployment

61 - Elk River Electric920.926 UTILITY SHARE DEF COMP 40,004.30 42,000.00 47,000.00

61 - Elk River Electric920.9261 UTIL SH OF MEDICAL/DENTAL/DISA 407,875.03 525,936.15 555,000.00 Includes employer share of 8.3% increase

61 - Elk River Electric920.9262 UTILITY SHARE OF PERA 179,668.72 192,000.00 275,000.00 2014 low - Increased for staff positions filled in 2015 as well as new Engineer 2016

61 - Elk River Electric920.9263 UTILITY SHARE OF FICA 178,056.22 192,000.00 195,000.00

61 - Elk River Electric920.9264 EMPLOYEES SICK PAY 82,166.19 96,768.00 95,000.00

61 - Elk River Electric920.9266 EMP VACATION/HOLIDAY PAY 238,396.85 230,000.00 250,000.00

61 - Elk River Electric920.9269 CONSERVATION IMP PROGRAM 91,675.57 186,454.00 169,444.00 more rebates paid from ERMU funds and not reimbursed from GRE, addtl staff 2015

61 - Elk River Electric920.9281 ENVIRONMENTAL COMPLIANCE 24,766.33 27,000.00 27,000.00

61 - Elk River Electric920.9291 CONSULTING FEES 4,923.68 85,000.00 30,000.00 2015 was higher for territory acquisition

61 - Elk River Electric920.9301 TELEPHONE 21,754.44 22,000.00 26,000.00

61 - Elk River Electric920.9302 ADVERTISING 2,913.51 5,500.00 7,000.00

61 - Elk River Electric920.9303 DUES & SUBSCRIPTIONS - FEES 134,632.92 200,000.00 87,000.00 2014 included MAPP fees that are no longer

61 - Elk River Electric920.9304 TRAVEL EXPENSE 3,212.12 15,500.00 15,000.00

61 - Elk River Electric920.9305 SCHOOLS & MEETINGS 149,929.05 177,294.00 175,000.00

61 - Elk River Electric920.9306 MISC GENERAL EXPENSE 51,809.48 1,000.00 1,000.00

61 - Elk River Electric920.9321 MTCE GEN PLANT/OFF HEAT 4,998.50 21,000.00 21,000.00

Total Admin & General 2,542,021.82 3,053,012.92 3,028,844.00

Total Expense Budget 32,106,470.03 33,049,151.00

2.94% increase over current year, total

2.78% increase over current year, excluding purchased power

* Amounts to be adjusted with kWh amounts determined from new acquisition territory

72


Water

Other Exp 62 - Elk River Water595.8031 DEPRECIATION 1,083,769.71 1,130,000.00 1,140,000.00

62 - Elk River Water596.8071 INTEREST ON BONDS/LONG TERM 73,464.00 67,080.00 60,192.00 Per bond contracts, lower interest 2016

62 - Elk River Water596.8075 INTEREST ON DEFEASED BONDS -817.80 -818.00 -842.00 Per bond contracts

62 - Elk River Water750.7581 2010 GO BONDS AMORT DISCOUNT -3,272.00 -3,272.00 Per bond contracts

62 - Elk River Water596.8213 LOSS ON DISPOSITION OF PROP 43,138.13 1,000.00 1,000.00 2014 had loss on assets removed

62 - Elk River Water597.826 TRANSFER TO CITY FOR 99 BOND 25,000.00 30,000.00 30,000.00

62 - Elk River Water597.8261 WATER AND LABOR DONATED 500.00 500.00

62 - Elk River Water597.8264 DAM MAINTENANCE EXPENSE 0.00 7,800.00 Moved from electric budget

62 - Elk River Water597.8341 INTEREST PD ON METER DEPOSITS 0.00 20.00 New

62 - Elk River Water597.84 RENTAL PROPERTY EXPENSE 1,583.76 2,500.00 1,000.00

Total Other Exp 1,226,137.80 1,226,990.00 1,236,398.00

Production 62 - Elk River Water700.7021 MTCE OF STRUCTURES 12,143.57 20,000.00 28,000.00 Redistribution of labor in 2016

62 - Elk River Water700.7022 TOWER & GROUNDS INSPECTION 2,955.16 0.00 Redistribution of labor in 2015

Total Production 15,098.73 20,000.00 28,000.00

Pumping 62 - Elk River Water710.7101 SUPERVISION 7,516.30 20,600.00 47,000.00 Allocations different for 2016 for Water Supt, GM

62 - Elk River Water710.7181 SUPPLIES & EXPENSE 251,935.05 250,000.00 230,000.00

62 - Elk River Water710.7182 SAMPLING 9,264.45 9,000.00 15,000.00 Increase sampling requirements

62 - Elk River Water710.7183 CHEMICAL FEED 43,800.83 30,000.00 30,000.00 Switched chemical supplier in 2015

62 - Elk River Water710.722 MTCE OF WELLS 100,481.28 125,000.00 130,000.00 Redistribution of labor in 2016

62 - Elk River Water710.723 SCADA - PUMPING 10,499.17 15,000.00 12,500.00 Redistribution of labor in 2016

Total Pumping 423,497.08 449,600.00 464,500.00

Distribution 62 - Elk River Water730.7301 MTCE OF WATER MAINS 43,389.36 60,000.00 50,000.00 Redistribution of labor in 2016

62 - Elk River Water730.7309 LOCATE WATER SVC 5,343.88 7,500.00 7,500.00

62 - Elk River Water730.7311 MTCE OF WATER SERVICES 39,320.91 5,000.00 0.00 Redistribution of labor in 2016

62 - Elk River Water730.7312 WATER METER SERVICE 4,384.34 0.00 6,000.00 Redistribution of labor in 2016

62 - Elk River Water730.7315 INSTALL & MTC IRRIG METERS 1,409.32 5,000.00 5,000.00

62 - Elk River Water730.7321 MTCE OF CUSTOMERS SERVICE 30,880.61 31,000.00 25,000.00 Redistribution of labor in 2016

62 - Elk River Water730.7325 WATER MAPPING 12,649.28 18,000.00 18,000.00

62 - Elk River Water730.7331 MTCE OF WATER HYDRANTS 25,889.78 25,000.00 30,000.00 Redistribution of labor in 2016

62 - Elk River Water730.7341 MISC WATER EXPENSE/INVENTORY 11,372.37 12,000.00 12,000.00

62 - Elk River Water730.7391 WAGES/WATER 3,758.43 0.00 7,209.00 Allocations different for 2016 for GM

62 - Elk River Water730.7395 TRANSPORTATION EXPENSE 15,666.03 15,000.00 15,000.00

62 - Elk River Water730.7399 GENERAL EXP/WATER PERMIT 13,295.07 14,000.00 14,000.00

Total Distribution 207,359.38 192,500.00 189,709.00

73


Customer Exp 62 - Elk River Water900.9021 METER READING EXPENSE 3,757.65 7,000.00 2,100.00 Redistribution of labor in 2016

62 - Elk River Water900.9021 COLLECTING EXP DISC/RECONNECT 1,437.15 6,500.00 1,000.00

62 - Elk River Water900.9051 MISC CUSTOMER ACCTS EXP-COMP 65,170.76 45,000.00 42,000.00 2014 incl Paymentus term $19k

62 - Elk River Water900.9061 CUST BLGS NOT PD/SENT FOR COLL 145.17 1,000.00 1,000.00

Total Customer Exp 70,510.73 59,500.00 46,100.00

Admin & General 62 - Elk River Water920.9201 SALARIES/OFFICE & COMMISSION 128,013.33 141,000.00 164,000.00 2015 low - Increased for staff positions filled in 2015

62 - Elk River Water920.9205 TEMPORARY STAFFING 3,379.14 2,000.00 2,000.00

62 - Elk River Water920.9211 OFFICE SUPPLIES & EXPENSE 23,093.57 35,000.00 28,000.00 2015 high

62 - Elk River Water920.9212 LT & WATER CONSUMPTION/OFFICE 5,400.70 5,000.00 5,000.00

62 - Elk River Water920.9213 BANK CHARGES 808.12 1,000.00 1,000.00

62 - Elk River Water920.9221 LEGAL FEES 4,007.06 5,500.00 5,000.00

62 - Elk River Water920.9231 AUDITING FEES 4,019.27 3,600.00 3,600.00

62 - Elk River Water920.9241 INSURANCE 31,669.76 44,216.40 35,000.00 2015 high

62 - Elk River Water920.926 UTILITY SHARE DEF COMP 9,829.59 12,000.00 12,000.00

62 - Elk River Water920.9261 UTIL SH OF MEDICAL/DENTAL/DISA 132,149.74 120,234.04 150,000.00 2015 low - Includes employer share of 8.3% increase

62 - Elk River Water920.9262 UTILITY SHARE OF PERA 19,929.52 23,000.00 23,000.00

62 - Elk River Water920.9263 UTILITY SHARE OF FICA 21,317.23 23,000.00 24,500.00

62 - Elk River Water920.9264 EMPLOYEES SICK PAY 19,492.95 23,040.00 25,000.00

62 - Elk River Water920.9266 EMP VACATION/HOLIDAY PAY 56,231.00 50,000.00 57,000.00

62 - Elk River Water920.9268 MISCELLANEOUS - WELLHEAD PROT 597.46 5,000.00 1,000.00

62 - Elk River Water920.9269 CONSERVATION IMP PROGRAM 15,290.43 10,000.00 10,000.00

62 - Elk River Water920.9281 ENVIRONMENTAL COMPLIANCE 487.37 750.00 575.00

62 - Elk River Water920.9291 CONSULTING 344.00 10,000.00 10,000.00

62 - Elk River Water920.9301 TELEPHONE 5,427.31 5,100.00 7,500.00 2015 low

62 - Elk River Water920.9302 ADVERTISING 2,996.44 5,000.00 4,000.00

62 - Elk River Water920.9303 DUES & SUBSCRIPTIONS - FEES 36,853.13 38,000.00 38,000.00

62 - Elk River Water920.9304 TRAVEL EXPENSE 824.25 2,500.00 2,750.00

62 - Elk River Water920.9305 SCHOOLS & MEETINGS 19,377.33 25,000.00 25,000.00

62 - Elk River Water920.9306 MISC GENERAL EXPENSE 1,660.47 500.00 500.00

62 - Elk River Water920.9321 MTCE GEN PLANT/OFF HTG 1,249.63 2,000.00 2,060.00

Total Admin & General 544,448.80 592,440.44 636,485.00

Total Expense Budget 2,541,030.44 2,601,192.00

2.37% increase over current year, total

74

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TO:





FROM:




SUBJECT:

2016 Utilities Fee Schedule

DISCUSSION:

Typically, the Elk River Municipal Utilities Commission approves the budget in December.

Then in January, the rates and fees are published. Per legal counsel, the Utilities’ ability to

collect on fees would be strengthened by having them adopted into City ordinance after being

approved by the Commission. Although ERMU has not yet been notified of the 2016 wholesale

power costs increase, fees are less impacted by the wholesale power costs and in many cases can

be determined earlier in the budget process.

ACTION REQUESTED:

Staff recommends approving the 2016 Utilities Fee Schedule for adoption into ordinance by the

City Council.

ATTACHMENTS:

Proposed 2016 Utilities Fee Schedule

75

Elk River Municipal Utilities2016 Utilities Fee Schedule

Proposed Fee Schedule

1 New Residential Electric Connection - Developer - Lot with ERMU water service 475.00$ 475.00$ 2 New Residential Electric Connection - Developer - Lot without ERMU water service 575.00$ 575.00$ 3 New Residential Electric Connection - Builder 875.00$ 875.00$ 4 New Wire Footages over 200' (per foot) 4.00$ 4.00$ 5 New Service Frost Trenching (per foot) 5.00$ 5.00$ 6 New Commercial & Industrial Electric Connection 50% 50%7 Service Upgrades or Additions for Existing Customers 100% 100%8 Minimum Temporary Electric Service Fee - Existing Transformer 150.00$ 150.00$ 9 Minimum Temporary Electric Service Fee - Without Existing Transformer 500.00$ 500.00$

10 Street Light - 30' Decorative Pole with 6' Arm and Fixture 1,850.00$ 1,850.00$ 11 Street Light - 23' Decorative Pole with Traditionaire Fixture 1,500.00$ 1,500.00$ 12 Security Light - Wood Pole with Fixture 975.00$ 975.00$ 13 Security Light - Existing Pole 125.00$ 125.00$ 14 Pole Attachment Fee (per pole) 6.50$ 6.50$ 15

16 Water Access Charge = Water Connection Charge + Water Availability Charge 3,325.00$ 3,425.00$ 3.01%17 Water Connection Charge (Per Plumbing Unit) - Builder 3,000.00$ 3,090.00$ 3.00%18 Water Availability Charge (Per Plumbing Unit) - Developer 325.00$ 335.00$ 3.08%19 Abandoned Water Service 2,500.00$ 2,500.00$ 20 Hydrant Water Sales - Rental (per week) $50/week $50/week21 Hydrant Water Sales - Units (per 1000 gallons) 4.00$ 4.00$ 22 Deposit for 5/8" Hydrant Meter 150.00$ 150.00$ 23 Deposit for 2 1/2" Hydrant Meter 1,000.00$ 1,000.00$ 24 Private Hydrant Maintenance Program Monthly Fee 5.00$ 5.00$ 25

26 NSF Fee 30.00$ 30.00$ 27 Red Tag Handling Fee 20.00$ 20.00$ 28 Administrative Fee for Continued Submission of Checks After No-Check Notice Given 20.00$ 20.00$ 29 Penalty Amount 10% 10%30 Electric Service Disconnect Fee - Meter Technician 50.00$ 50.00$ 31 Electric Service Disconnect Fee - Line Crew 150.00$ 150.00$ 32 Water Shut-Off Fee 100.00$ 100.00$ 33 Meter Tampering Fee 250.00$ 250.00$ 34 Meter Testing Fee 50.00$ 50.00$ 35 Energy Audit 50.00$ 50.00$ 36

37 Billable Cost of Materials Markup 15% 15%38 Billable Labor Markup 55% 55%39 Billable Vehicle / Equipment (per employee per hour) 30.00$ 30.00$ 40

Fee Description 2015Proposed

2016

Proposed

Increase

76

of 1


TO:





FROM:

Theresa Slominski – Finance & Office

Manager



SUBJECT:

Performance Metrics Update

BACKGROUND:

Following adoption of the Commission adopted Performance Metrics program in December

2012, we are tracking the progress for 2015, to be awarded in 2016. This is a company

performance based program designed to incentivize employee commitment towards the

company’s success. Divided into categories representing core values of the company and again

into sub-categories that are quantifiable, this program is designed to track goals that require

companywide support of the employees to continually achieve. When the employees work

together as a team to achieve these goals, the company recognizes a corresponding increase in

value to our customers.

DISCUSSION:

At close of the fiscal 2015 year, and completion of the audit, the final score card will be

evaluated and presented to the Commission for awarding the related bonus in 2016. We will be

tracking the progress of the company and the related score card quarterly throughout 2015. The

third quarter scorecard is attached, with some notes for the third quarter results.

ACTION REQUESTED:

None, this is for information only.

ATTACHMENTS:

Performance Metrics and Incentive Compensation Policy Score Card - 2015

77

Elk River Municipal UtilitiesPerformance Metrics and Incentive Compensation Policy Score Card - 2015

Category Percent Sub-Category Sub-Percent Goal Score

Awarded

Multiplier

Percentage Notes as of 9/2015

Water Quality Standards 15Meet

Requirements complete

CAIDI 5 <120 Minoff target 152.048 Minutes average customer out (down from 2nd qtr 176.111)

SAIDI 5 <90 Minon target 15.616 Minutes average system out (up from 2nd qtr 7.431)

SAIFI 5 < 0.5on target 0.1 Number of Interruptions (up from 2nd qtr .04)

Customer Satisfaction 10 > 85%complete Customer Satisfaction survey results 94.87%

Employee Turnover 10 < 7.5%on target 2.30%

Participation in Recommended

and Mandatory Trainings10 > 95%

on target 97.55%

Margins/Net Profit 20 > Budgeton target

Reserves 10 > Targeton target

Inventory Accuracy 10 > 95%on target as of 3rd qtr water (100%), electric (94.5%), security (91.4%)

Total Multiplier:

Approved December 12, 2012

Safety, Reliability

and Quality of

Utility Services

30

Customer Service

and Employee

Development

30

Financial Goals 40

78

of 2


TO:





FROM:



AGENDA ITEM NUMBER: 6.1a

SUBJECT:

Staff Updates – General Manager

DISCUSSION:

The Board of Directors of the Minnesota Municipal Power Agency (MMPA) met on

September 22, 2015 in Shakopee, Minnesota. At the meeting, the Board was informed

that the City of Chaska, Minnesota, an MMPA member, priced its refunding bonds

related to the Minnesota River Station. The refunded generated present value savings of

$3.3 million, which will be split equally between the City of Chaska and MMPA.

The Board also received updates on the distributed generation project in Shakopee,

Minnesota, and the solar project in Buffalo, Minnesota.

On October 7 the Midwest Municipal Transmission Group (MMTG) had their annual

meeting Mason City, Iowa. The membership approved the financial report and proposed

dues structure change. The change in dues structure shifts collecting for zonal dues to

general dues. The membership nominated and elected board members for those sits that

had become open.

The MMTG board held a meeting following the annual membership meeting. The board

nominated and elected officers. Wes Hompe, the General Manager of Willmar Municipal

Utilities, was elected 2016 MMTG Chair. The board also approved a memorandum of

understating with CMMPA to engage in transmission investment discussions on

MMTG’s behalf.

The Field Engineer position included in the 2015 budget continues to be on hold due to

the heavy workload associated with this time of year. We will look to post the position

yet this year.

Minnesota Municipal Utilities Association board approved action for a subcommittee to

develop the business plan and scope for a Leadership Development Program. I am on that

committee along with Jack Kegel – MMUA Executive Director, Jerry Williams –

Rochester Public Utilities Commissioner, and Mark Fritch – Owatonna Public Utilities

79

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General Manager. The committee will present deliverables to the MMUA board for

approval with a desired MMUA Summer Conference roll out. The core mission for the

program is: “A leadership development program to enhance the competencies necessary

to excel as organizational leaders.”

Elk River Rotary kicks of the 2015-2016 Students Taking a Renewed Interest in the

Value of Education (STRIVE) Program with the Elk River High School on October 13.

The program pairs Rotarians with seniors in jeopardy of not graduating with their class.

This mentorship program takes place at the ERHS during first period approximately a

dozen times throughout the school year. Each mentorship session provides development

on life skills that should help the senior to not only raise their GPA and graduate, but

become successful in life. This will be my second year as a Rotarian mentor in this

program.

On October 5, the city council issued a proclamation declaring October 4-10 as Public

Power Week.

With the potential expansion in membership of the utilities commission, Michelle

Canterbury and I have started working on the governance manual and policy book

revisions that had been presented to the commission in the past.

I attended the October 5 council workshop for their budget discussion. The budget will

include a water trunk fund transfer of $300,000 for the 2016 Well #9 Filter Plant

addition. Tim Simon and Justin Femrite have been working Eric Volk and me over the

past few years on the project planning and water/wastewater trunk fund areas. This has

been a good process that has helped us to coordinate efforts.

ATTACHMENT:

Proclamation designating October 4-10 as Public Power Week

80

of 2


TO:





FROM:

Theresa Slominski – Finance and Office Manager


AGENDA ITEM NUMBER: 6.1b

SUBJECT:

Staff Update

DISCUSSION:

In the past, we have presented quarter write-offs in the month immediately following the

calendar quarter, so third quarter write-offs for July through September were presented in

October. With our new software, the process is different and the complete information is not

available in such a short turn-around. The process looks back a full month, and is run at the end

of a month. So July-Sept data is processed at the end of October, and would then be available to

present in November. Moving forward, we will be adjusting our reporting timeline by one

month. The new schedule will be as follows: third quarter presented in November, fourth

quarter presented in February, first quarter presented in May, and second quarter presented in

August.

We had four staff members attend the NISC software Member Information Conference (MIC) in

St. Louis, MO September 28th

– 30th

. Those attending were Jennie Nelson, Customer Service

Manager; Christy Schallock, Customer Service Representative; Jenny Biorn, Staff Accountant;

and Geri Fournier, Purchasing Specialist. They were able to participate in individual classes to

learn more about the software as they use it, ask questions of the experts, and network with other

users. All found it very valuable, and so thanks for allowing them the opportunity to attend.

Their education reports are attached.

I received communication from Assurant that they will be merging with another company,

SunLife Financial, by the end of the first quarter 2016, subject to regulatory approvals. Assurant

will still operate business as usual with employee contracts and we should have no change in our

benefits with them. Per an email from Assurant “This may have come to your attention so I just wanted

to pass along some facts about the acquisition announcement last evening. In short, nothing will change with our work on ERMU, not the offer, service, value adds, etc... All proposals will be issued under Assurant and honored as this merger will not be official for months. Sun has acquired all of our leases too so we’ll still be neighbors

with the same personnel.” I have attached a letter from the company as well.

82

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ATTACHMENTS:

Jennie Nelson Education Report

Christy Schallock Education Report

Jenny Biorn Education Report

Geri Fournier Education Report

Assurant Letter

83

of 2


TO:





FROM:

Mark Fuchs – Electric Superintendent


AGENDA ITEM NUMBER: 6.1c

SUBJECT:

Staff Update

DISCUSSION:

Had seven new services.

Continue working on collecting data with the GPS for our ArcView maps as time

permits.

Continue working on changing out some of the rusty junction boxes or removing ones

that are no longer necessary.

Continue working on changing out fuse pads. This has been an ongoing project that had

to be done due to our high fault current.

Put rebuilding River Ranch in Otsego on hold until we have the new feeder from the

Waco substation to the court house area completed.

Continue working on installing a new feeder out of the Waco substation the court house

area.

Started installing wire for 16 new residential lots in Prestigious Woodland Hills Third

Addition.

Changed out a single phase pole and hung a larger transformer to address a voltage

complaint for the cell tower on 205th

Ave.

A driver of a gravel truck that forgot to put his box down hit two single phase taps and

broke a pole after they hit the secondary service.

Working on installation of a pole and blades for the County Road 12 Interconnection with

Connexus. We’ve also begun the process of replacing the stickers and locks on the

equipment with ours. While we’re doing this, we’ll make any necessary changes to the

maps and make notes on what needs to be fixed.

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Curt Wark, Reid Nelson and Aaron White attended the Minnesota Municipal Utilities

Association (MMUA) Overhead Lineworker School September 15-18 in Marshall, MN.

Their education reports are attached.

ATTACHMENTS:

Curt Wark Education Report

Reid Nelson Education Report

Aaron White Education Report

91

of 2


TO:



Al Nadeau – Vice-Chair

Daryl Thompson - Trustee

FROM:

Mike O’Neill – Technical Services Superintendent


th, 2015

AGENDA ITEM NUMBER: 6.1d

SUBJECT:

Staff Update

DISCUSSION:

The Locating department had a total of 360 locate tickets in September; three of them being

emergency tickets, four cancellations, 13 meetings, 311 normal tickets and 25 updated

tickets.

In September, the Security Systems Department had a total of 107 phone contacts, 11

systems quoted, seven system sales made, seven installs completed, 28 service calls and 11

personal visits.

Electric Technicians continue with the meter reading, power bill, substation checks, hanging

red-tags, meter read-outs, dealing with meter and off-peak issues, as well as delivering and

installing new meters to commercial customers. They continue to change out the three phase

meters with meters that will be read by radio. Preparations have begun for the conversion of

the new service territory in 1B. Meters have been ordered, working on ensuring that all

customers are in database.

The power plant staff did the monthly engine run on September 30th

. All engines ran well

with no problems.

Meter Technicians completed the meter swap out for the newly acquired 1A area in 2 ½

days. This was a great accomplishment and helped to ensure that ERMU would have

accurate and complete meter reads as well as all of the databases being correct in our billing

software.

Jeff Murray and Tony Hubbard attended the Minnesota Electric Meter School September

14-16 in Roseville, MN. Their education reports are attached.

95

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ATTACHMENTS:

Security Systems Weekly Update

Security Systems Analysis

Jeff Murray Education Report

Tony Hubbard Education Report

96

13069 Orono Parkway P.O. Box 430Elk River, MN 55330-0430


Security System Weekly Update

Month of August

Number of Contacts 89

Number of systems quoted 13

Number of sales made 7

Number of Installs completed 13

Number of service calls 23

Personal Visits 13

Revenue Aug-15 19,777$ Expense Aug-15 17,867$ Margin* Aug-15 1,910$

YTD Revenue Aug-15 164,617$ YTD Expense Aug-15 141,252$ YTD Margin* Aug-15 23,365$

* Margin calculations exclude depreciation, payroll taxes, benefits coverage and office support

97

Security Revenue and Margin 2014

Jan Feb Mar April May June July August Sept Oct Nov Dec

Total Year

Budget

Revenue 29,110 28,705 20,044 20,946 23,326 24,542 21,080 23,547 23,042 24,069 21,502 22,690 **YTD Revenue 29,110 57,815 77,859 98,805 122,131 146,674 167,754 191,301 214,343 238,412 259,914 282,604 265,000

Expense 12,292 13,237 20,940 16,508 16,354 14,136 21,308 16,670 12,898 21,556 15,469 16,761 **YTD Expense 12,292 25,529 46,469 62,977 79,331 93,467 114,775 131,445 144,342 165,898 181,367 198,128 215,000

Margin* 16,818 15,468 -896 4,438 6,972 10,407 -228 6,877 10,145 2,513 6,033 5,929YTD Margin* 16,818 32,286 31,391 35,829 42,801 53,207 52,979 59,856 70,001 72,514 78,547 84,476 50,000

** April 2014 results exclude correction for 40K overbilling on security services.* Margin calculations exclude depreciation, payroll taxes, benefits coverage and office support

Security Revenue and Margin 2015

Jan Feb Mar April May June July August Sept Oct Nov Dec

Total Year

Budget

Revenue 31,014 18,788 18,081 17,915 18,515 15,330 25,197 19,777YTD Revenue 31,014 49,802 67,883 85,798 104,313 119,643 144,840 164,617 164,617 164,617 164,617 164,617 270,000

Expense 14,894 16,335 20,367 20,561 16,936 18,172 16,120 17,867YTD Expense 14,894 31,229 51,596 72,157 89,093 107,265 123,385 141,252 141,252 141,252 141,252 141,252 215,000

Margin* 16,120 2,453 -2,286 -2,646 1,579 -2,842 9,077 1,910 0 0 0 0YTD Margin* 16,120 18,573 16,287 13,641 15,220 12,378 21,455 23,365 23,365 23,365 23,365 23,365 55,000

* Margin calculations exclude depreciation, payroll taxes, benefits coverage and office support

98

-$50,000

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Security Contribution in Dollars

Revenue Expense Margin

99

of 2


TO:





FROM:

Eric Volk - Water Superintendent


AGENDA ITEM NUMBER: 6.1e

SUBJECT:

Staff Update

DISCUSSION:

Delivered eight new residential water meters.

Sealed the water meter, and took curb stop ties from eleven water services.

Turned on two water services, and two electric services.

Turned off three water services, and two electric services.

Went on six service calls.

Completed 25 BACTI/Total Chlorine Residual Samples

o All confirmed negative for Coliform Bacteria.

Completed 20 routine fluoride samples

o All samples met MDH standards.

Fire hydrant preventative maintenance has been completed for 2015. The total amount of

fire hydrants that were serviced amounts to an astonishing 485 hydrants; this figure

includes 250 hydrants owned by the utility, 166 private hydrants, and another 85 hydrants

that were serviced by the water operators and painted by the HOG Chapter. At this rate,

all 1200+ hydrants in Elk River will have preventative maintenance in four years; one

year ahead of schedule.

Angela Hauge has started the long and tedious task of validating all of our GIS based

water maps. This will help to ensure that all of our valves are located on the proper water

mains and that there are no valves or hydrants missing from the map.

Dave Ninow has been working on locating and upgrading all of our tracing wire that was

installed with most of the HDPE water main. In the process, he will install “Snakepit”

locating boxes at as many locations as possible.

Mike Langer has a list of hydrant repairs that he is working on. These repairs were

identified during the preventative maintenance that was completed this summer.

We cleaned out the Gary Street Water Tower and drained it in preparation of Slack

Painting coming out to paint the belly of the tank, the dry tube, and the top of the

condensate ceiling.

102

of 2

Justin Femrite and Brandon Wisner facilitated the restructuring of the YMCA pond back

into two separate ponds how it had previously been before the YMCA was built. This

was required because we backwash Well #4 into the pond. In the future, the YMCA will

be responsible for part of the pond maintenance, and we will be responsible for our own

part.

Verizon Wireless is getting closer to installing antennas on the Auburn Street Water

Tower. Troy Adams is working on the contract and I am working on the site plans. After

this site is completed, we will have six attachment agreements on three different water

towers.

We met again with Kodet Architectural. They have produced a couple of different

variations for the future field services expansion. We have not decided on a direction for

the new building, the current buildings, or the field services property. We have worked

hard with Brandon Wisner and Kristin Mroz from the city to ensure we are sensitive to

the wetlands located on the property. As we progress further in the process, we will bring

site and building plans to the commission.

The water department will be hosting an intern from St. Cloud’s Technical College Water

Environmental Technologies (WET) Program. He will be shadowing the water operators

October 26-30.

I have been appointed as co-chair for the Training and Education Committee for the

Minnesota Section of the American Water Works Association (MN-AWWA). This four

year commitment consists of: first year is co-chair to be trained, second and third years

are chair, and the last year is co-chair to train my replacement.

ATTACHMENTS:

September Pumping By Well

September 2015 Daily Temperature Graph

September 2015 Accumulated Precipitation Graph

103

Values Are Displayed in Millions of Gallons (Well #, Gallons Pumped, Percentage of Pumping)

Well #2, 8.233, 9%

Well #3, 16.369, 19%

Well #4, 20.316, 23%

Well #5, 0, 0%

Well #6, 11.791, 14%

Well #7, 13.183, 15%

Well #8, 16.934, 20%

Well #9, 0, 0%

September 2015 Monthly Pumping By Well

102

of 1


TO:





FROM:

Tom Sagstetter - Conservation and Key Accounts

Manager


th, 2015

AGENDA ITEM NUMBER:

6.1f

SUBJECT:

Staff Update

DISCUSSION:

Rebate volume has been very high lately. The fourth quarter is always has the highest

volume. This is also the time of year where companies are putting together capital

budgets for the upcoming year and want rebate estimates.

The LED holiday lighting contest and promotions are being finalized and getting ready to

print. Attached is a copy of the LED holiday lighting promotional flyer.

The Coffer Dam data center project is still waiting for a final response. The most recent

response from September 20th

indicated that they have not made a final decision as of yet.

All of the commercial customers in area 1B were sent letters informing them of the

transition date and time. Jolene Fenn-Jansen followed up with a personal phone call to

each of the commercial customers to make sure they received the letter and to see if they

had any questions or concerns.

ATTACHEMENT:

LED Holiday Lighting Promotional Flyer

101

CONTESTGRAND PRIZE

FIRST RUNNER-UP

SECOND RUNNER-UP

MOST CREATIVE

BEST USE OF LED LIGHTS

*Community Ed. HOPE Award

$ 1 25 .0 0

$75 . 0 0

$50 . 0 0

$50 . 0 0

$50 . 0 0

$50 . 0 0

December 9-12 December 15

Winners Announced

Judging

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regular meeting of the utilities commission...

Documents