4.2. SR 09-18-2000City of
E
River MEMORANDUM
item #4.2.
TO:
FROM:
DATE:
SUBJECT:
Mayor & City Council
Pat Klaers, City Administrator
September 18, 2000
Utilities Commission Update
Councilmember John Dietz is the City Council representative on the Elk
River Municipal Utilities Commission. At this September 18, 2000, City
Council meeting, John is scheduled to provide the council with an update on
August and September Utilities activities. Attached for your review are the
draft minutes from the September 13, 2000, Utilities Commission meeting.
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone (763) 441-7420 · Fax (763) 441-7425
SEP-14-O0 O;:IOPMFROM-ELK RIVER UTILITIES 61Z4418098 T-Sg? P.01/04 F-Z~5
ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
SEPTEMBER 13, 2000
Members Present: John Dietz, President; George Zabee, Vice Chairman; James Tralle,
Trustee
Stuff Present: Brya~ Adams, General Manager; Glenn Sundeen, Line Superintendent;
David Berg, Water Superintendent; Patricia Hemza, Office Manager
Others Present: Dave Lucas, Sherbum¢ County Solid Waste Officer
1. Call meetin~ to order at 4:00 P.M. Sentember 13. 2000
2. Consider Utilities Agenda
Bryan Adams added two topics to be discussed under Other Business.
James Tralle moved to approve the Utilities Agenda, with two additional items by
Bryan Adams to be discussed under Other Business. George Zabee seconded the motion.
Motion carried 3-0.
3. Consider Consent Agenda
lames Tralle moved to approve the Consent Agenda.
John Dietz asked if there were any questions about the check register or the
financials. George Zabee and lohn Dietz each questioned two items on the Check
Register, and Staff responded. ~lohn Dietz asked about the Electric expense portion of the
Profit and Loss Statement for luly.
George Zabce seconded the motion to approve the Consent Agenda as follows:
August Check Register
Financials
Approval of the August 8, 2000 Minutes
Motion carried 3-0.
SEP-14-O0 D;:IOPM FROM-ELK RIVER UTILITIES 6124418Dgg T-Sg? P.02/04 F-Z35
Page 2
Regular meeting of the Elk River Municipal Utilities Commission
September 13, 2000
5.1 ~;herburne County Landfill Gas Presentation
Bryan reviewed the draft pwposal to expand the el¢c~ic generation facility at the
Elk River Landfill, along with the Draft Letter of Intent, and the Cash flow analysis. The
participation between Sherburne County, Waste Management, and the Elk River
Municipal Utilities was further explained and discussed. Mx. Lutes addressed the
environmental issues concerned, and stated that he expects the Sherburne County
Commission to react favorably to the project. John Dietz asked about coordination of the
commitment by all three pardes involved. James Tralle responded in favor of the project.
Bryan Adams noted that Great River Energy has recently advised that the Utilities will be
charged for services for capacity displaced by this added generation.
James Tralle moved to authorize completion of thc Letter of Intent. George
Zabee seconded the motion. Motion can'ied 3-0.
5.2 U_odate Electric Rate Study
The initial report from R.W. Beck regarding the ]Elk River electric rates was
presented and discussed, with forecasts and requirements to enable conclusions regarding
revenue. No recommendations or rate design were included. Bryan Adams explained
the cost of service/fixed cost approach. He also noted that it is anticipated that we
relinquish block rates, the continuance of winter/summer rates to include demand
customers, along with increasing customer fixed charges. James Tralle asked if a rate
change would hurt the school customers. James Tralle asked for options to be included
in the recommendations. George Zabee asked for Staff recommendations to be included
in the options.
5.3 Review Pronosed 2001 Capital Pro_iects Budget
The proposed 2001 Capital Budget with 10 year projections was presented and
discussed. John Dietz noted that the years 2001 and 2002 appear to be heavily
encumbered, and he would like to see a bigger spread between the years. John Dietz
asked questions regarding territory acquisition. Discussion centered on future water
towers, wells, treatment plants, and the future need for a new office building and
warehouse at the plant. The possibility of raising water rates to cover the increase in
maintenance expense was discussed.
SEP-14-O0 03:1OPM FROM-ELK RIVER UTILITIES 61Z4418069 T-597 P.03/04 F-Z36
Page 3
Regular meeting of the Elk River Municipal Utilities Commission
September 13, 2000
6.1 Update on Wholesale Power Cost Ad_iustment
Bryan Adams updated the Commission on the wholesale monthly power cost
adjustment (PCA), that we will need to pass on to our retail customers. Discussion
centered on the reasons for the PCA, and the volatility of the energy market.
James Tralle moved to institute positive retail PCA for thc next three months.
George Zabee seconded the motion. Motion carried 3-0.
6.2 Consider Pureha.~ing New Electric Line Truck
The 2000 Budget includes a $120,000.00 item to replace an electric digger derrick
line truck. The vehicle being replaced is in fairly good shape, but it will be eleven years
old when it is replaced. The option of purchasing a new truck and keeping the proposed
wade-in mack as a standby was discussed.
Staff is directed to seek bids for a new electric digger derrick/linc truck, with
options of a trade, as well as no trade.
Bryan Adams advised the Commission of Public meetings to be held by the
Minnesota Depa~haent of Commerce regarding their plan for the furare reliability of
electric services in Minnesota. Bryan urged Commission members to attend. A general.
discussion of de-regulation followed, with opinions by Commission and Staff.
Pat Klaers, City Administrator has requested a joint meeting between the Elk
River City Council and the Elk River Utilities Commission to be held September 25,
2000, at 6:00 P.M. at the City Hall Council Chambers. Suggestions for topics to be
discussed are the Main Street Project, a Water Tower site, and Municipal Building.
General discussion of the Main Street Project followed, with consensus to agree to the
joint meeting on that date.
John Dietz advised the Commission that the City Council has approved the
purchase of a fire truck, to be paid for from Utility Transfers to the City.
A Special Meeting of the Elk River Utilities Commission with the Elk River City Council
will be held at 6:00 P.M. on September 25, 2000 in the City Hall Council Chambers.
The next regularly scheduled meeting of the Elk River Municipal Utilities Commission
will be held at 4:00 P.M. October 3, 2000 in the Utilities Office.
SEP-14-OO 03:11PM FROM-ELK RIVER UTILITIES 61244180gg T-Sg? P.04/04 F-235
Page 4
Regular meeting of thc Elk River Municipal Utilities Commission
September 13, 2000
James Tralle moved to adjourn the September 13, 2000 meeting of the Elk River
Municipal Utilities Commission. George Zabee seconded the motion. Motion carried
0.
The September 13, 2000 Regular Meeting oft_he Elk River Municipal Utilities
Commission adjourned at 5:30 P.M.
Respectfully submitted,
Patricia Hernza
Office Manager