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ERMUSR MISC ITEMS 09-21-2004 Elk River Municipal Utilities 13069 Orono Parkway phone: 763.441.2020 Elk River, MN 55330 Fax:763-441.8099 September 8, 2004 To: Elk River Municipal Utilities Commission Jerry Takle James Tralle John Dietz From: Bryan Adams Subject: Miscellaneous Issues Enclosed is the packet for Tuesday, September 21, 2004 commission meeting at 4:00 p.m. This packet is being delivered a week early, for I will be in Canada fishing during the week of September 13t. We recently included a survey as a bill stuffer attempting to measure the response of our "Wait Till Eight" load management program. Attached is our "Wait Till Eight" brochure with the survey results. Enclosed is the following information for your review. 1) Part of Pat Klaers memo dated August 2004, addressing 2004 Property Tax Data. 2) Star Tribune article titled, "Big Upgrade for Power Grid." Elk River 4 Municipal Utilities SPECIAL REQUEST! 13069 Orono Parkway Elk River, MN 55330 763/441-2020 Elk River Municipal Utilities is trying to assess the effectiveness of our `Wait Till Eight" Program and we would be most appreciative if you would complete the following survey and return it along with your August payment. Thanks in advance for your help! 1. Do you recall seeing the "Wait Till Eight" brochure we mailed to you with your June bill? Yes No If yes, did you read and consider any of the energy saving ideas listed in it? Yes No (please circle the response that applies) 2. Have you implemented any of the t gy saving ideas described in the "Wait Till Eight brochure? Yes No (please circle the response that applies) If yes, which of the following have you implemented? (please check all that apply) I turn up my air conditioner 5 degrees when outside temp is 90 or higher. I turn off my dehumidifier between 5 PM and 8 Pm. I wait until after 8 PM to wash and dry clothes. I wait until after 8 PM to wash dishes. I wait until after 8 PM to cook the evening meal on those hot summer days. I'm doing my part by participating in your Cycled AC Program. 3. If you circled No to the last question, it would help us to better understand how we can more effectively communicate the importance of the "Wait Till Eight" Program if you would check which of the following best applies to you. This is the first time I have heard about"Wait Till Eight". I don't think any "Wait Till Eight" ideas will help reduce my electric bill. I can't participate in "Wait Till Eight" because of health reasons. I don't believe there is an impending energy shortage. l Cla I ` Z t 9S c.p. a t ii, \rises% C cla Cam, , a tt hilitil 1%41 4. ∎ •,Y""•':•i:,• � r le* CL) tag'^ sue, s:•Zh. 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Est.� O ^ !� Y o a oo co x _ co 3 3 s i ti n co Go ^ It 1 A, S o o ` CO CO ! a c. 0 0 O 1 i/ ' �f x co LC CC t S' a •� b n p i■ \Tr ,,00 °oA s x a� °cn cc o S a S .4 v'I A A Q. r E A A W c"o a c � ' CC ti •`' A co M t V 1/4'.' "Cli. S Z Cr-,A '0 cc r.., A' n os yS a S• O S a Vj A. S S Ss n S 1 S I Wait Till Eight Survey Results The Wait Till Eight survey was sent to all 7,700 ERMU electric customers with their July bill. Of that total, 866 were commercial accounts. While the Program targets residential accounts,commercial accounts received the survey to help "spead the word"even though we knew few would respond (four were identified). 1,132 surveys were returned as of Aug 17 for a 16.6% response rate. The survey had three goals: To further inform our customers about the importance of curtailing electric use during peak hours of the day. (A supplement to the brochure sent out in June.) To determine the readership of our mailers. To determine the willingness of our customers to voluntarily cut back at peak times. Results: Of the total 1,132 surveys returned, 836 (74%) indicated they had seen the Wait Till Eight brochure. Impossible to determine how that number applies to the other 5,702 that didn't respond. (The Wait Till Eight brochure was mailed with their June bill.) Of the 836 who indicated they had seen the brochure, 658 (79%) said they had implemented at least two of the energy saving ideas listed in the brochure. While 296 (26%)had not seen the Wait Till Eight brochure, several requested that we send them one—that was done if they included an address. A number indicated they did not see the brochure because they new customers. 296 respondents indicated they participate in our Cycled AC program. Seems high Many of the respondents added their own tidbits to the survey -these are some of the more interesting ones: -"I don't understand the statement"referring to turning up the AC 5 degrees at 5PM. -"I think your advertising will help people save on electric." - "I do wonder why the local schools water their fields mid-day, especially when there are watering restrictions in Elk River." -"I now only buy energy star appliances." -"And it didn't do one darn bit of good in my bill." -"I water on my designated day but it irritates me that businesses water whenever they want even when it's mining out." -"Wait Till Eight has Great Ideas!' - "My bill is always high, it's like I'm doing someone elses bill. Please check." -"Off-Peak is great. Everyone should use CFLs." -"I have pets that have to be kept cool or they will die." -"I would absolutely participate in this whenever I can, I just never read it." -"My husband is diabetic and can't wait till after eight to eat." -"Are you kidding?" -"It was easier for me to learn about Wait Till Eight by reading question 2." - "Are you running out of garbage to burn?" -"Bring back your Off-Peak program. Great program!" -"My husband is an electrician with Xcel so we understand the shortage." -"My bill is already as low as in can go because my parents taught me to conserve" 2004 PROPERTY TAX DATA The League of Minnesota Cities (LMC) annually publishes die property tax data for all municipalities. This information is traditionally published in the September Minnesota Cities magazine. Tins information is also available on the League website at wunv.lmnc.org_ Attached for your information is some of the 2004 property tax data for a few communities that can be compared to the City of Elk River. The attached list includes similar sized and growing metropolitan communities, similar sized non-metropolitan cities, and a few neighboring communities. Elk River has a higher total tax rate than all 12 of the metropolitan communities listed in the attachment. There are a few communities that have higher tax rates in each of the three major categories: county, city, and school. However, the majority of cities have lower rates than Elk River in each of these categories. In very general terms, the difference between the majority of die cities listed and Elk River in the county category is about 23%, in the city category is about 32%; and in the school category is about 43%. It should be noted that in numerous communities you will see a low city tax rate combined with a high county tax rate and vice versa; so there are some offsetting circumstances. Overall, in looking at the total tax, rate the city is approximately l0% above the majority of the cities listed. Regarding the non-metropolitan cities, Elk River is right in the middle of the pack. Six communities have higher tax rates than Elk River and five communities have lower tax rates. Regarding the local communities, Elk River is in a similar position as to Big Lake, Rogers, and Zimmerman with the other communities, including Otsego and St. Michael, being lower. Population Update The property tax data from LMC also includes 2003 population figures. These population figures are the same as what comes from the Minnesota State Demographer and the population estimate is as of April 1, 2003. I yr 3 yr 2000-2003 2000 Pop. 2002 2003 % change % change population City (Census) Pop. Pop. ('02to '03) ('00to '03) change Albertville 3,621 4,517 4,983 10.2 37.6 1,362 Becker 2,673 3,220 3,395 5.4 27 722 Big Lake 6,063 7,273 7,707 6 27.1 1,644 Buffalo 10,097 11,422 12,120 6.1 20 2,023 Otsego 6,389 8,210 9,356 14 46.4 2,967 Rogers 3,588 ! 5,010 5,580 11.4 55.5 1,992 Zimmerman 2,851 3,305 3,619 ' 9.5 26.9 768 Elk River 16,447 18,082 18,758 3.7 14.1 2,311 , Of all the cities listed above, Elk River grew by the lowest percentage over the past year (April 2002 to April 2003) and over the past three years (April 2000 to April 2003). The City of Otsego has increased its base population more than the City of Elk River. Also, Rogers approached our total growth over the previous three years. When there is discussion throughout the school district about rapidly growing communities and moderately growing communities, I think it is safe to say the Elk River is in the moderate growth rate category. 2004 Property Tax Data Average Average Average Average Average 7 County City School Special Total.Tax County 2002 Tax Tax Tax Tax Rate for Metro City Population : Rate Rate Rate Rate 2002 Andover 28,939 35.77 31.35 20.90 3.18 91.20 Anoka 18,275 35.77 41.06 21.05 5.93 103.81 Champlin 22,925 47.32 35.74 21.05 8.74 112.86 Chanhassen 21,600 48.41 32.88 31.76 5.87 118.92 Chaska 20,260 48.44 19.23 37.52 5.65 110.85 Hastings 19,782 30.30 50.11 22.05 4.69 107.14 Lino Lakes 18,368 35.77 42.29 31.93 5.81 115.80 Prior Lake 19,662 36.63 34.44 ; 32.33 7.79 111.18 Ramsey 19,208 35.77 37.81 22.50 5.85 101.92 Rosemount 16,794 30.30, 52.37 24.83 5.12 112.62 Savage 23,570 36.63 51.40 25.26 6.08 119.37 Shakopee 24,967 36.63 32.43 21.42 5.34 95.83 ELK RIVER 18,758 44.41 43.78 30.95 3.57 122.71 I 'von Metro Albert Lea 18,082 61.81 29.01 28.99 2.53 122.33 Fairbault 22,037 33.72 25.80 26.97 3.82 90.30 Hutchinson 13,545 63.26 61.31 23.10 1.43 149.10 Marshall 12,788 52.09 46.35 37.41 0.58 136.44 New Ulm 13,798 50.86 58.78 14.26 1.51 125.40 N. Mankato 12,429 48.67 39.89 13.30 0.69 102.54 18,256 33.33 38.40 33.32 1.51 106.56 Owatonna 23,379 50.44 39.31 24.88 0.86 115.48 Red Wing 16,191 56.94 63.56 23.38 2.05 145.93 Willmar 18,597 77,99 : 26.05 25.71 2.78 132.52 Worthington 11,300 56.16 49.42 28.74 3.90 138.22 I Local Area Albertville 4,983 35.62 35.75 34.32 0.00 105.69 Becker 3,395 44.41 27.04 19.90 1.84 93.18 Big Lake 7,707 44.34 45.26 40.23 3.88 133.71 Buffalo 12,120 36.29 28.22 39.94 0.00 104.45 Otsego 9,356 35.63 29.01 31.13 3.04 98.82 Rogers 5,580 47.32 42.03 - 30.95 5.76 126.07 St Michael 12,343 35.63 34.09 34.96 1.25 105.94 Zimmerman 3,619 44.30 52.23 30:78 0.84 128.15 Source: League of Minnesota Cities website: www.lmnc.org S/admin/citpop/page 2 Big upgrade for ower rid p g State's largest utilities will pay for a $1 billion expansion. By Chris Serres the next 15 years to build new and Minnesota Power in Duluth. and increases the possibility of Star Tribune Sta ff Writer power lines and to upgrade ex- Executives at the companies a major blackout. isting ones.The project,dubbed said in interviews Tuesday that Our power system load has Minnesota's rickety power "Cap X 2020," would increase they can no longer put off in- increased tremendously over grid is about to undergo its the state's transmission capac- vesting in new lines. Demand the past 20 years,and it has put biggest upgrade in more than ity by 5,000 megawatts per hour for electricity in this state is greater stress on the transmis- 20 years, as utility companies — about the same amount of growing faster than supply,and sion infrastructure," said Rod scramble to keep pace with electricity produced by five the power lines carrying elec- Scheel, vice president of asset higher demand and to prevent nuclear power plants the size of tricity into and out of Minnesota management at Otter Tail Power, future blackouts. Prairie Island. are frequently operating at full which serves 127,000 customers The state's four largest The four companies are Xcel capacity.That limits the amount in the Upper Midwest. power companies recently told Energy Inc. of Minneapolis, Ot- of affordable power that Minne- state regulators that they plan ter Tail Power Co.of Fergus Falls, sota utilities can buy from en- POWER continues on D6: to spend at least$1 billion over Great River Energy of Elk River ergy companies in other states —System not made for heavy use. POWER from Di from lower-cost coal-based Consumer demand creates Creek plants in other states. In 1999, Great Ri ver's Coal Creek power plant in Under- bottlenecks in electric lines dur- ing one of the hottest days"Without [his capital ex- tlenecks along key the year. Because many of the penditurel, the probability of a leading to and from Minnesota power esota already were operating blackout or other reliability is- For instance, the 345,000-volt at full capacity, Great River had sues would be elevated,"Scheel transmission line that stretches to buy the electricity at an exor- said. from the Twin Cities to Milwau- bitant price. The reliability of the nation's kee is often operating at full ca- "It's like paying $500 for a electricity grid has come under pacity during hot or cold days, Snickers bar," said Don Jones, i renewed scrutiny since a wide- when electricity usage is high. director of transmission asset spread blackout on the East "We're trying to use the sys- management at Xcel Energy. Coast a year ago left 50 million tern in a way in which it wasn't The four companies will people without power. Many designed to be used," said Bill spend the next several months energy experts blamed deregu- Head,chief operating officer of analyzing the future needs for lation of the nation's wholesale MAPPCOR,a contractor for the power lines in this state and power industry In 1996,federal Mid-Continent Area Power Pool, how to build them. The group regulators allowed energy com- a regional planning agency plans to submit a draft report panies to buy and sell power These bottlenecks are costly to the Minnesota Public Utili- across state lines,which led to to consumers because they can ties Commission and the state Mending theµµ gr d more power being transmitted prevent utility companies from Department of Commerce in Ce � . long distances over lines that accessing affordable power.On October.A final report will fol- What's going on?Minneso- were never built to serve that hot days in July, for instance, low in March. purpose. power companies are some- ta's four ill sPe power least At the same time,consumer times forced to rely on expen- Chris Sevres is at panies 1 ll n ve the at next demand for electricity has in- sive, natural-gas fired plants, cserres @smrtn'bune.com. years rs to over tee nest to creased,which has created bot- rather than importing power agarg power uegradt the state's aging power system. Why is it necessary? Power lines carrying electric- ity into and out of Minnesota are operating near capacity, increasing the risk of pos- sible blackouts. What's next?The group of power companies will assess the state's future needs for power lines and submit a report to state regulators in October.