Loading...
2.2. ERMUSR 11-18-2014 ELK RIVER MUNICIPAL UTILITIES SPECIAL MEETING OF THE UTILITIES COMMISSION HELD AT UTILITIES CONFERENCE ROOM October 21,2014 Members Present: John Dietz,Chair;Al Nadeau,Vice Chair Members Absent: Daryl Thompson,Trustee ERMU Staff Present: Troy Adams,General Manager; Theresa Slominski,Finance and Office Manager; Mark Fuchs,Electric Superintendent; Eric Volk,Water Superintendent; Wade Lovelette,Technical Services Superintendent; Tom Sagstetter,Conservation&Key Accounts Manager; Michelle Canterbury,Executive Administrative Assistant Others Present: Cal Portner,City Administrator;Peter Beck,Attorney 1.0 CALL MEETING TO ORDER John Dietz called the October 21,2014 meeting to order at 3:30 p.m. 1.1 Pledge of Allegiance The Pledge of Allegiance was recited. 1.2 Consider Utilities Agenda John Dietz asked to add an item under Other Business: Dog Park. Al Nadeau moved to approve the amended October 21,2014 Utilities agenda. John Dietz seconded the motion. Motion carried 2-0. 2.0 CONSENT AGENDA(Approved By One Motion) John Dietz had a few questions on the new financials. Staff responded. Al Nadeau moved to approve the Consent Agenda as follows: 2.1 September Check Register 2.2 September 9,2014 Previous Meeting Minutes 2.3 Financial Statements Page 1 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 27 2.4 Paymentus John Dietz seconded the motion. Motion carried 2-0. 3.0 OPEN FORUM No one appeared for open forum. 4.0 OLD BUSINESS There is no old business. 5.0 NEW BUSINESS 5.1 Frost Trenching More than two decades ago ERMU stopped doing frost trenching for new services and outsourced this work to local contractors. This was due to the retirement of equipment, system growth, and company priories. With the addition of an experienced Lead Bore Rig Operator this year, now would be an ideal time to bring frost trenching back in-house. This year ERMU purchased a new Vermeer RTX550 cable plow that could do this type of work if we were to add a trenching attachment. This attachment would cost$15,000. Troy Adams shared that there has been sufficient savings in the 2014 capital budget to pay for the unbudgeted $15,000 for this proposed frost trenching attachment, and the proposed frost trenching rate would have a breakeven point of about two years for a piece of equipment that should last more than five. Mark Fuchs added that this would be an ideal time to do this as the frost trenching season begins November 1St. John Dietz had some questions. Staff responded. Al Nadeau made a motion to approve the purchase of an unbudgeted frost trenching attachment for$15,000. John Dietz seconded the motion. Motion carried 2-0. 5.2 Wage and Benefits Committee Update—Health &Dental Insurance At the September 9th Commission meeting, the Commission approved the 2015 renewal of the health insurance plans. The Wage and Benefits Committee (W&BC)met on September 18th to discuss the details of the insurance renewal and Health Savings Account(HSA) Insurance Plan employer contribution. Troy Adams recapped that last year was the first year of offering an alternative health insurance plan to help the company save money. The Commission agreed to take the savings and put it back into the employees HSA to incentivize employees to migrate to the Page 2 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 28 HSA plan from the more expensive traditional co-pay plan. The incentive worked well as ERMU experienced a 53%conversion to the HSA plan, saving the company$10,000 more than projected. One of the areas we didn't see as many switch over to the HSA was the single plus one, which was likely because the employer contribution was less than that of the family yet the deductible was the same as family. The HSA renewal included a change to deductibles for the plan. The family and single plus one deductibles increased by$100, and the single deductible increased by$50. Based on the higher savings resulting from higher conversion rate, the breakdown for annual HSA employer contributions recommended by the W&BC were: $1,985 for family and single plus one; and $650 for single. The renewal information for dental, life, and long term disability were not received by ERMU until after the W&BC meeting. The renewal costs are minimal for 2015, a total of $5,007.88. Because of renewal deadlines management recommended Commission approve the renewal; with the understanding that we'll go out for bids in 2015 for 2016 renewals. John Dietz had a few questions. Staff responded. Troy Adams addressed the issue of direct deposit. Now that we've completed our software conversion for the Accounting and Business Solutions module, staff has found that there is a significant administration burden to process physical checks for payroll. There are currently only three individuals receiving physical checks. Management recommended the Commission approved the elimination of physical paychecks effective January 1, 2015. Al Nadeau made a motion to approve an increase in 2015 HSA insurance plan employer contributions to $1,985 for family and single plus one, and increase to $650 for single; to approve the 2015 dental,life, and long term disability insurance renewal; and to approve the elimination of physical payroll checks effective January 1,2015.John Dietz seconded the motion. Motion carried 2-0. 5.3 2015 Utilities Fee Schedule Troy Adams presented the 2015 Fee Schedule to the Commission. There were a few adjustments to the schedule from 2014 to 2015. Staff recommended the Commission approve the 2015 Utilities Fee Schedule for adoption into ordinance by the City Council. The Commission had a few questions. Staff responded. Al Nadeau made a motion to approve the 2015 Fee Schedule. John Dietz seconded the motion. Motion carried 2-0. 5.4 2015 Budget—Water and Electric Expenses Theresa Slominski presented the water and electric expense budgets. The 2015 forecast for Page 3 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 29 II water expenses reflected a 2.1% increase and the electric expenses a 1.3%increase. The expense budget will change as the complete 2015 budget is assembled and the finalized wholesale power costs are reflected. Revenues and rate increases for 2015 will be presented in November. John Dietz asked a few questions. Staff responded. Troy Adams went over the proposed staff additions for consideration. Staff budgeted for the addition of an entry level Field Engineer and a Key Accounts Specialist. Also included was a part-time cleaning position or contracted cleaning employee for the Field Services building. With the retirement of the current Technical Services Superintendent we would look at hiring the replacement early in 2015 to allow for an overlap in training. These staff additions are preliminary and will be discussed further with the Wage and Benefits Committee for their recommendations. 5.5 Third Quarter Write-Offs Theresa Slominski presented the delinquent items for the third quarter. Our budgeted amount for collections and write-offs are $105,000 or .32%Uncollectable Accounts per Revenue Dollar. Our write-offs for the year are well below this number, at a total of $12,828.16 or.037%. According to APPA's most recent published standard ratios (2012), the industry standard is between .10% and .41%. Theresa also presented a color-coded recap comparison with last year, identifying the various categories and running totals. The Commission had a few questions. Staff responded. Al Nadeau made a motion to approve the Third Quarter Write-Offs. John Dietz seconded the motion. Motion carried 2-0. 5.6 National League of Cities Service Line Warranty Program Eric Volk informed the Commission that ERMU recently met with the Regional Area Manager for the National League of Cities (NLC) Service Line Warranty Program. This company offers coverage for buried, external water and sewer lines from the utility connection point to the home. Eric included the highlights of the program in his memo. Eric told the Commission that he made some calls to the four other cities that were participating in the program and found out that one of them had dropped out. The other cities that were using the service gave mixed reviews. Some of the dissatisfaction was due to the limited coverage the program had to offer. Troy Adams explained that this program seems less viable for us as we have the ability to finance a customer's water or sewer line expense through assessment. There was further discussion. The Commission was in consensus to continue with the assessment method we currently have in place. 5.7 2014 Midwest Municipal Transmission Group Annual Meeting Update Page 4 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 30 Troy Adams shared that the Midwest Municipal Transmission Group (MMTG) is who helped create the framework for municipals to obtain ownership in the transmission system. Regulatory and legal advocacy is a major part of what MMTG does for its members. Through them we have a voice through participation policy proceeding at the Federal Energy Regularity Commission(FERC) and other federal agencies; this very important vehicle for us to protect our customers. Troy gave an overview and update on the CAPX2020 Brookings Project in which Elk River Municipal Utilities (ERMU)has invested. As a result of the zero dollars "out of pocket"investment that ERMU made in the project, ERMU will receive approximately$100,000 in 2014 and$60,000 for the next 30 years beginning in 2015. At that time the bonds will be paid for and the revenues will increase. At the conference, the membership and board voted on the next Board of Directors and Officers. Troy Adams, who served as Chair in 2014, passed the gavel onto his successor. 6.0 OTHER BUSINESS Dog Park- John Dietz said that he has had some residents ask him if we could put some type of light up by the dog park. The dog park is very well used and there have been some concerns with it getting dark so early in the evening. Mark Fuchs said that we had put some lights up by the new playground and he thought that we could do something like that at the dog park. 6.1 Staff Updates Troy Adams added that 2016 Lineworkers Rodeo will be hosted in Shakopee at Canterbury Downs. Mark,Wade and Troy recently attended the kick-off meeting with MMPA. Elk River Municipal Utilities(ERMU)has teamed up with Detroit Lakes,and has volunteered to help with one of the events. ERMU will be donating and installing 8 poles for the event. There was some further discussion on the rodeo. Troy Adams had one other item to bring up in regards to cyber security and the budget. Looking forward to next year,we're going to want to have some cyber penetration testing done. Currently there is no line item in the budget for this. Troy will be looking into the cost of the tests,and will bring those numbers back as a line item in the budget. John Dietz asked Theresa Slominski if we were still working with the IT staff and the city on the conversion.Theresa responded that we are still working with them. She added that we're also in the process of looking into the new phone system with them. Mark Fuchs informed the Commission that Ed Zurn,one of our lead lineworkers,gave his two week notice on October 20th. There was further discussion. Mark suggested discussing what we want to do for a replacement at the next Wage and Benefits meeting. John Dietz asked Wade Lovelette how the security system is doing overall. Wade responded that things are going good and that they have been very busy. John Dietz had a few other Page 5 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 31 questions. Staff responded. Eric Volk gave an update on the Twin Lakes Parkway water main project. John Dietz asked when we were going to have the Harley Owners Group(HOGS)at our commission meeting for recognition. Eric explained that we're in the process of getting a perpetual plaque that we can display at our office that recognizes our volunteers. Once we have that in place we can invite the HOGS and present them with their engraved plate to be added to the plaque.Eric also shared some great things about his department. They recently repaired a fire hydrant valve,which we had previously been contracting out,and by doing the work themselves with our own equipment,saved approximately$5,000. His crew is very anxious and excited to be doing the work themselves. Al Nadeau gave kudos to Eric for teaching them how to do these things. 6.2 Set Date for Next Meeting The next regularly scheduled Commission meeting will be cancelled due to the Veterans Day holiday and a special meeting will be held on November 18,2014. The Commission recessed the regular meeting at 4:29 p.m. 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 Al Nadeau moved to adjourn the regular meeting of the Elk River Municipal Utilities Commission at 4:50 p.m. John Dietz seconded the motion. Motion carried 2-0. Minutes prepared by Michelle Canterbury. John J.Dietz Chair,ERMU Commission Tina Allard City Clerk Page 6 Special meeting of the Elk River Municipal Utilities Commission October 21,2014 32