6.1. ERMUSR 08-10-2010Elk River ----
Municipal Utilities
13069 Orono Parkway • EO. Box 4.30
Elk River, MN 55330-0430
UTILITIES COMMISSION MEETING
Phone: 763.441.2020
Fax: 763.441.8099
TO: FROM:
Elk River Municipal Utilities Commission Troy Adams, P.E. -Director of Operations
John Dietz, Chair
Jerry Gumphrey, Vice Chair
Daryl Thom son, Trustee
MEETING DATE: AGENllA ITEM NUMBER:
Au ust 10, 2010 6.1
_
SUBJECT:
Staff Updates -Director of Operations
DISCUSSION:
Sherburne County Emergency Services and the Community Emergency Response Team have
requested atour/demonstration at our power plant and some discussion on safety working around
utilities during a natural disaster. This tour was held on Aug 4a' for a group of approximately 20
people.
After the June 17`x' storms, F,KMU provided mutual aid assistance to Rochester for their tornado
recovery efforts. Attached is a letter from the Mayor of Rochester thanking ERMU for our help.
There are new rules for employees to take time off to vote. Previously, state legislation allowed
employees to be absent from work without penalty during the morning of an election day to vote.
In 2010, this has been changed to allow the employees to absent from work without penalty
anytime during an election day to vote. See the attached League of Minnesota Cities memo.
This November, American Public Power Association (APPA) has a Public Power Leadership
Workshop in Portland, Oregon. I'm planning on attending this training. This is in substitution
for the APPA Nation Conference held earlier this summer for which we had budgeted for 1 staff
and 2 commissioners to attend. See the attached conference information.
Fox your reading is the attached article from APPA, "City-owned utility in Lubbock, Texas, to
absorb 24,000 retail customers from Xcel Energy". The article covers a recent case where a
municipal utility acquired customers another utility. The take home message is that this
municipal utility put them in a position to succeed through increased efficiency, local control,
voluntary citizen board of directors and excellent customer service.
Attached is an article from the Todd-Wadena Electric Cooperative Pine to Prairie News
addressing costs has a quote from Great River Energy President and CEO David Saggau stating
that GRE's rates will continue increase. For the most part, this would be common sense. But by
discussing bad new often enough, customers can become desensitize and complacent. Continued
focus and pressure on controlling costs can help ERMU remain competitive and provide safe
reliable services at competitive prices. However, this is not enough. Pressure on our wholesale
power supplier to control costs and pressure on our legislators to not unfairly burden public
power customers is also important.
_ll.L-.4NERICA CffY
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July 12, 2010
Mayor Ardell F. Brede
201 4th Street SE -Room 281
Roches[er. MN X5904-3782
Phone: (507)328-2700 Fax:(~07)328-2727
REC~iVrD 1UL ~ 32fiisl
Stephanie Klinzing, Mayor
Lori Johnson, Administrator
City of Elk River
13065 Orono Pkway NW
EIk River MN 55330-5600
Stephanie and Lori:
4:.~..~
Y
I am writing to express the City of Rochester's sincere thanks to your city and Elk River
Public Utilities for sending two linemen to assist us after the tornado that hit Rochester
the night of June 17~". Thanks also to Troy Adams, ERU General Manager and Mark
Fuchs, Line Superintendent. Others responding to our request for assistance came
from Austin and Owatonna.
While our crews from Rochester Public Utilities worked non-stop the assistance you
provided helped our residents get power restored much more quickly and safely.
We are grateful for your help and being a "good" neighbor.
Sincerely,
Ardell F. Brede, Mayor
City of Rochester
New Rules for Employee Time Off to Vote
Page 1 of l
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New Rules for Employee Time
Off to Vote
A new law expands time off provision from morning only to all day.
(Published Jul 21, 2010)
The 2010 Legislature expanded the oppoRunlty for employees to be absent from work without penalty to
vote. Legislators deleted the provision that had previously allowed such absences only in the morning of
Election Day. The new law became effective on April 2, and will be in force for the 2010 state primary
on Aug. 10 and for the general election on Nov. 2.
Every employee who is eligible to vote has the right to be absent without penalty or loss of salary or
wages. The actual new language provides [hat employees have the right to be absent from work "for the
time necessary to appear at the employee's polling place, cast a ballot, and return [o work on the day of
that election."
According to Minnesota Statutes, seCtlOn 2O4C.O4 (Link to https rrwww.revisor mn.gov/sta(u(esOid=204C 04J , employers
or others may not either directly or indirectly refuse or otherwise interfere with an employee's right to
take the time to vote on Election Day. Violations of the statute are subject to penalty as a misdemeanor.
Election polling places are scheduled to open at 7 a.m. and close at 8 p.m. for voting on Aug. 10 and
Nov. 2.
Read the current issue of the Cities Bulletin (c;nk (o rv(puwww lmen.8rpagenrc;ras-aarrenn-newtle(ear/spy
Your LMC Resource
Contact Ann Higgins
IGR Representative
(651)281-1257 or(800)925-1122
ahlgglnS~a ImC.Org (Link to: mailm: ahiggins@lmc.org)
Copyright ®2010 League of Minnesota Cities, 145 University Ave. W, Saint Paul, MN 55103-20641 Phone: (651) 281-12001 Toll-Free: (800) 925-I l22
htip://www.lmc.org/page/1/election-timeoffjsp 7/21/2010
_~~ ~ American
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November 3-5, 2010 ~ Portland, Oregon
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8-8:30 a.m.
Registration and Coffee
8:30-8:45 a.m.
Welcome and Introductions
Jeff Tarhert
Senior lice President
APPA
Washington, D. C.
8:45-10:15 a.m.
What CEOs and
Senior Managers Do:
Leadership in a Time of Change
Utility CEOs and managers wear many hats and must juggle
many issues: from power supply, to human resources, to
meeting customer needs, to working in the political and en-
vironmental arenas. This session will examine what it takes
to be an effective utility senior manager including: setting or-
ganizational direction, defining appropriate roles and respon-
sibilities, directing and motivating staff, and working with the
utility's governing body.
Lonnie Carter
President and CEO
Santee Cooper
MoncksCorner, S. C.
10:15-10:30 a.m.
Break
Who Should Participate
General managers and CEOs
(particulary those new to their jobs)
Senior managers and those on track far executive
leadership positions and any others who are interested
in the issues and processes that face utility chief exec-
utives and general managers.
What You'll Learn
This workshop focuses on the changes and challenges
facing public power today; and the skills, knowledge
and techniques leaders need to guide their organiza-
tionsand governing bodies through the evolutionary
years ahead.
ii r ,
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10:30 a.m.-Noon
Understanding the Ohanging
Business Environment:
Our Industry's Outlook
for the Next Five Years
Setting the strategic direction for your utility requires an un-
derstanding of the external forces that affect the electric util-
ity industry, including national energy policies, competitor
strategies, customer expectations, new technology, environ-
mental challenges and more. Examine the significant issues
facing public power, including power supply, climate change
regulation, wholesale markets, energy efficiency, renewable
resources, smart grid and other trends.
Marc Gerken
President and CEO
American Municipal Power, lnc.
Columbus, Ohio
Noon-1:30 p.m.
Lunch (on your own)
1:30-4:30 p.m.
Financial Management:
Operational and Strategic
Financial Issues for Management
A key area of executive responsibility is the financial health
and performance of the organization. Examine the financial
and operational information and other data senior executives
need to determine how the organization is performing, po-
tential areas of enterprise risk, tools for longer-term financial
planning, and the metrics used to evaluate the financial con-
dition of the utility and to convey this information to policy-
makers and stakeholders.
Mark Beauchamp
President
Utility Financial Solutions
Holland, Mich.
~'~1,~~°sday, N~~e~be~ ~
8:30 a.m.-Noon
Strategic Leadership (Part 1):
Planning Tools to Set
Organizational Direction
Athoughtfully-developed strategic plan is a primary leader-
ship tool for utility executives. Successful implementation of
the plan requires buy-in by appropriate stakeholders. This
session will focus on:
^ Developing an effective strategic planning process
^ Building understanding and commitment to the strategy
^ Implementing the plan and monitoring its progress
^ Identifying benchmarks and self-assessment tools
for management
^ Aligning organizational measurement and
control systems with the strategy
^ Using tools to support strategic focus and
decision-making within the organization.
Bryan Singletary
President
Practical Energies, Inc.
Tampa, Fla.
Noon-1:30 p.m.
Lunch (on your own)
1:30~i:30 p.m.
Strategic Leadership (Part 2):
Obtaining Buy-in from the Board
and Staff and Steps for Effective
Implementation and Monitoring
Arguably the most important relationship for the senior exec-
utive or CEO is working effectively with the utility governing
body. This begins with agreement on a common direction
and goals for the organization. This session will examine:
^ A case study describing how to develop the strategic
direction of the utility, with board and staff involvement,
and arriving at agreed-upon values, goals and objectives
^ Examples of plan components, such as: power supply
(integrated resource plan); energy efficiency and
conservation; financial planning; and work force planning
^ A system for qualitative and quantitative measures
of progress and performance
^ And, ultimately, getting the community to accept the
strategic plan and using the plan to convey the value
of the utility to all stakeholders
Bill Gaines Cliff Lewis
DirectodCEp Partner
Tacoma Public Utilities Traversa Consulting
Tacoma, Wash. San Francisco, Calif.
Friday, November 5
8:30 a.m.-Noon
Developing Your Most
Effective Leadership Style
Learn about the critical leadership and people management
skills that CEOs and senior managers must use to focus
staff on organizational priorities. Learn how to help your
staff achieve their highest performance. The instructor will
discuss styles and competencies of successful leaders and
how they are applied to motivate individuals and move the
organization forward.
Gordon Maner
Program Manager, Local Government Programs
Carl trnson Institute of Govemment
University of Georgia
Athens, Ga.
Noon
Workshop Adjourns
City-owned utility in Lubbock, Texas, to absorb 24,000 retail customers from Xcel Energy Page 1 of 2
City-owned utility in Lubbock, Texas, to absorb 24,000 retail
customers from Xcel Energy
For nearly a century, two electric utilities have strung power lines side by side and have fought over the
right to sell electricity to the people and businesses of Lubbock, a city in northwestern Texas with a
population of 225,000. Since the eazly 1900s, the privately owned Xcel Energy and its predecessors
have had one set of poles and wires running down one side of the street, while the city-owned Lubbock
Power and Light has had a second set along the other side of the street. Occasionally, over the yeazs, the
two utilities have sparred, threatening to buy each other out, and more often than not, it was the private
utility threatening to acquire the municipal one. Now, in this tale of two utilities, it looks as though the
municipal utility is emerging as the victor.
Late last year, after more than a yeaz of talks, the investor-owned utility agreed to turn over its retail
customers in Lubbock to the municipal utility. Lubbock Power and Light will pay Xcel Energy $87
million to buy the private utility's distribution system within the city limits. LP&L said it will gain about
24,000 new customers. The municipal utility plans to issue revenue bonds to finance the buyout.
LP&L cleazed another hurdle July 30 when the Public Utility Commission of Texas approved the
proposed sale. Lubbock is still awaiting approval from the New Mexico Public Regulation Commission;
that decision is expected by the end of September. The sale, announced in November 2009, is scheduled
to close in late October.
Lubbock Mayor Tom Martin, who led the negotiations, said the deal makes sense. "It's natural for
LP&L to pick up the Xcel retail electric service, since the city of Lubbock already provides utility
service to all the properties in Lubbock," he said.
The municipal utility currently has approximately 76,000 customers, so adding the Xcel customers will
bring the total to 100,000, Martin said.
"This represents the lazgest transfer of electricity customers to a municipal utility in recent history," said
APPA President and CEO Mazk Crisson. "The city of Lubbock should be proud, as this move reflects
the strong confidence the community has in Lubbock Power & Light's current operation and the value
public power brings to Lubbock residents."
Mayor Martin said there have been two sets of power lines running down every street and alley in
Lubbock since 1916, when residents approved bonds to build their own electric system. A private
electric company already had built a distribution system in the city, but the people were not happy
because the company shut down the power at 5 p.m. every day, he said. So the city built a competing
system in Lubbock, which covered one squaze mile, he said. Today, the city covers 140 squaze miles. In
some areas of the city, there are three utilities competing for business: Xcel Energy, Lubbock Power and
Light, and the South Plains Electric Cooperative. (The rural electric co-op continues to serve customers
in areas that were designated as the co-op's service territory many yeazs ago, when those areas were
rural.)
"Down every alley run two sets of lines, with gobs of transformers," Martin said. "It is a rat's nest of
lines."
The city has been planning to renovate its downtown, and wanted to put the lines underground, but it
does not make sense to put two sets of lines underground, he said.
http://www.naylometwork.com/app-ppd/articles/print-V2.asp?aid=122627 8/2/2010
___ _.
City-owned utility in Lubbock, Texas, to absorb 24,000 retail customers from Xcel Energy Page 2 of 2
In years past, Lubbock Power and Light had about half the city's electricity customers, but in recent
yeazs, thanks to good management, the municipal utility has enlarged its share, Martin said. "Slowly but
steadily, the customer mix changed, until we had 75% of the business," he said. Xcel, left with only
25% of the customers, found it had become very costly to maintain its lines, he said.
By the late spring of 2008, Xcel executives "were ready to exit," Martin told Public Power Daily.
Negotiations began in June that year, and ended in August 2009. A deal was announced last November,
and the transfer should happen by this November, he said. Xcel Energy, which does business in Texas
as Southwestern Public Service Co., will continue to supply wholesale power to Lubbock.
"We think municipal electric systems make a lot of sense for the consumer," Martin said.
For the last six years, Lubbock P&L's residential rates have been among the lowest in the state of Texas,
said Chris Sims, public information officer for LP&L. In 2010, excluding franchise fees and taxes, the
municipal utility's residential rate for 1,000 kWh has averaged $83.21 per month, he said.
LP&L CEO Dr. Gary Zheng credits the ufility's success to its increases in efficiency, local control,
voluntary citizen boazd of directors and excellent customer service as the primary reasons for LP&L's
success.
Some residents voiced opposition to the buyout, worried that their rates might go up as a result, Sims
said. "No one likes the term 'monopoly,' he said. But LP&L has published information about its rates on
its website, and this has helped calm feazs, Sims said.
The city-owned utility said it will finance the purchase of Xcel Energy's power poles, lines and
substations with electric revenue bonds, allowing its electric rates to remain among the lowest in the
state.
"We want all our customers to know that your electric rates will not increase as a result of this new
relationship," W.R. Collier, chairman of the LP&L Electric Utility Boazd, said last November, after the
city reached the agreement to take over service to the Xcel customers.
"Our community is very proud" of having its own municipal utility, said Martin.
Municipal electric utilities might make even more sense in the future than they have in the past, the
mayor added. "I've heard many investor-owned utility executives saying they want to re-orient," get out
of the retail electricity business, and focus more on production and transmission, he said. -JEANNINE
ANDERSON
http://www.naylometwork.com/app-ppd/articles/print-V2.asp?aid=122627 8/2/2010
__ __ __ _ _
Addressing costs: "Nothing is more important"
Energy is changing in America. Future economic Great River Energy President and CEO
growth will require additional sources of electric David Saggau, speaking at the Great
power and this new power will be the most expensive River Energy annual meeting last month:
ever built.
America is facing an energy crises: in the midst of
a struggling economy, our country needs to invest
in expensive new generation and, at the same time,
address climate change. These factors will drive up
costs significantly.
Electric bills will increase as a result of expected
federal action to address climate change.
"We are focused on addressing costs
-nothing is more important to us
right noru than working to keep rates
as affordable as possible for our members," said
Saggau. "However, our rate is going to continue
to increase -due to costs we have little control
over -and we do our members no favor by
pretending otherwise."
_~ ~~_
6~ ~-
Our Energy, Our Future
A Dialogue With America
Cooperatives' commitment Government's responsibilities
Cooperatives are doing our part. As member- In taking on the challenge of addressing climate
owned, not-for-profit organizations, we will: change, government must:
• Educate our members and elected officials
about affordability, reliability and energy policy.
• Work to manage costs and ensure reliability.
• Help our members save money and energy with
efficiency and conservation.
• Work with government to develop technology
needed to meet climate change goals.
Work with electric cooperatives to develop least-
cost solutions.
Be honest with consumers about the costs and
who will pay-no back-door taxes or hidden
agendas.
Invest in technology necessary to meet climate
change goals.
For additional information, please visit ourenergymn.coop.
www.toddwadena.coop July zoo9
Elk River -==
Municipal Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330.0430
UTILITIES COMMISSION MEETING
Phone: 763.441.2020
Fax: 763.44 L8099
TO: FROM:
Elk River Municipal Utilities Commission Theresa Slominski -Finance Director/Office
John Dietz, Chair Manager
Jerry Gumphrey, Vice Chair
D 1 Thom son, Trustee I
MEETING DATE: AGENDA ITEM NUMBER:
Au ust 10, 2010 6.1 ~'
SUBJECT:
Staff U dates -Finance Director/Office Mana er
DISCUSSION:
Last month I was asked if we had received customer complaints about the fees for utilizing the
credit cards and to keep the commission apprised of any such complaints. There have been three
complaints noted and these have been received from disconnect customers stating that this is
their only option and they already have to pay a $50 disconnect fee and they may incur two
$4.95 charges because they have to make more than one payment if the balance is over $300. I
have also received feedback from staff that many customers inquiring about credit card payments
have opted for other payment options when learning of the $4.95 fee, but I do not have an actual
count of those customers. One staff member kept a tally on one day and noted that five calls
were taken where customers inquired about credit cards, learned of the fee, and opted for
alternative payment methods.
I personally spoke with a customer (at their request) regarding the fee, and they commented that
it is great to be able to pay by credit card but the convenience is not so great as to warrant paying
$4.95. He stated that ERMU has to have some benefit in receiving payments sooner, guaranteed
payment, and ease of processing. He stated some customers not using credit cards may argue
they don't want to subsidize the processing cost to those that do pay by credit card, but taxes do
the same thing (if you don't have children in the schools, for example.)
Just as a "heads up", in the near future, we will be able to process sales of security systems via
credit cards. This would be different than utility bill payments due to the range of prices of
systems ($475 to $2,500.) A flat fee to cover the range isn't possible and so we would have to
process the credit cards based on a percentage fee of the sale. This cannot be passed on to the
customers and so must be absorbed. The security systems can easily be priced to absorb this if
the current margins don't support it.
Elk Riv
Municipal
Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
UTILITIES COMMISSION MEETING
Phone: 763.441.2020
Fax: 763.441.8099
TO: FROM:
Elk River Municipal Utilities Commission David Berg -Water Superintendent
John Dietz, Chair
Jerry Gumphrey, Vice Chair
Da 1 Thom son, Trustee
j MEETING DATE: AGENDA ITEM NUMBER:
~ Au ust 10, 2010
SUBJECT:
STAFF UPDATES Grav Water U date
Tim Steinbeck, GRE Manager said they are interested in learning more about using gray
water and would be able to cover around $2,000.00 to aid the process. The amount they
are able to provide will not suffice the project. We will continue to talk to see if there are
other options with open communication, but the gray water project will likely not work at
this time.
~/
er -==
Elk Riv
Municipal
Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
UTILITIES COMMISSION MEETING
P6one:763.441.2020
Fax: 763.441.8099
TO: FROM:
Elk River Municipal Utilities Commission David Berg -Water Superintendent
i John Dietz, Chair
~ Jerry Gumphrey, Vice Chair
Dar 1 Thom son, Trustee I
MEETING DATE: AGENDA ITEM NUMBER:
Au ust 10, 2010
SUBJECT:
STAFF UPDATES S rint Contract Update
/i
er -'~
As of August 3, 2010, the Sprint Contracts have been signed for the three antenna rental
agreements. The construction will commence at the end of August 2010, which should
be completed by September 2010.
Elk River ----
Municipal Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
UTILITIES COMMISSION MEETING
Phone: 763.441.2020
Fax: 763.441.8099
TO: FROM:
Elk River Municipal Utilities Commission Mark Fuchs
John Dietz, Chair Line Superintendent
Jerry Gumphrey, Vice Chair
Daz 1 Thom son, Trustee
MEETING DATE: AGENDA ITEM NUMBER:
Au ust 1Q 2010 6.1
SUBJECT:
Staff U dates
Discussion:
• We had some storm damage on Saturday July 17`n; three feeders were out of power
because of trees that had blown over. We also had some single phase overhead taps that
were out of power, one north of County Road 33 east of Hwy 169 and one on County
Road 13 and 20151 Avenue. There was also other smaller wind and lightening related
problems.
• A radial feed underground primazy tap went bad at 21884 Hwy 169.
• Four three phase fiberglass j-boxes were repainted, there were problems with the
fiberglass lids on some of the older models.
• Changed out the controller for the recloser on feeder 64 after it did not operate correctly
during the storm on July 17`n
• There was a bad underground primary tap at 420 3`d St.
installing a loop for this apartment building.
• Continued working on Engers Addition rebuild.
• Continued working on Area 22 rebuild.
• Continued working on 151 and 2nd Street rebuilds.
• Received four new electric service applications.
We aze working on replacing and
Elk River
Municipal Utilities
13069 Orono Parkway • PO. Box 430
Elk River, MN 55330-0430
UTILITIES COMMISSION MEETING
Phone: 763.441.2020
Fax: 763.441.8099
TO: FROM:
Elk River Municipal Utilities Commission Wade Lovelette. -Superintendent of Technical
John Dietz, Chair Services
Jerry Gumphrey, Vice Chair
Daz 1 Thom son, Trustee
MEETING DATE: AGENDA ITEM NUMBER:
Au ust 10, 2010 6.1
SUBJECT:
Staff U dates - Su erintendent of Technical Services
DISCUSSION:
The following is a summary of projects and/or updates over the past several weeks:
'This month the Locating Department had a total of 2621ocate tickets. Eight of those tickets were
"appointments required", fifteen were "updated" tickets and three were "emergency" locates.
Jeff has been extremely busy locating our underground lines for M&P Utilities as they aze
installing over eight miles of underground cable in the northern part of our service territory.
The Metering Department continues with weekly and monthly substation checks and doing the
monthly power bill. The meter change-out program is still continuing as time permits. During
this process they have helped the Water Department by changing 43 water meters last month
while they were changing the electric meters.
The Security Systems Departrnent had a total of 67 phone contacts, eight personal visits, eight
systems quoted, six sales made, ten installs completed and twenty service calls for the month of
July.
Power Plant staff has performed the monthly run of the generators. We aze waiting for a cylinder
head to be repaired on engine #1.
~~ ~~.~o~.~e~~~Q
August 5, 2010
Elk River Municipal Utilities
13069 Orono Pkwy NW
Elk River, MN 55330
Dear Troy Adams
On behalf of the Elk River Police Department and the residents we serve, please accept our
upmost appreciation for your generous donation of all of the Night-tiles and utility staff time
that you provided. Our Night to Unite would not be possible without the giving spirit of so
many like yourselves. This year's event served over 3,400 people at 37 different
neighborhood and community gatherings throughout the city which made this a remarkable
evening.
Please know that your willingness to support this yearly event plays a big part in keeping Elk
River residents and businesses safe. We could not do any of this without your support.
Thanks for all that you do.
With deepest appreciation,
Jeftke~A. Beahen, Chief of Police
JAB/kjt