6.1b ERMUSR 09-12-2017 Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Theresa Slominski—Finance & Office Manager
MEETING DATE: AGENDA ITEM NUMBER:
September 12, 2017 6.Ib
SUBJECT:
Staff Update
ACTION REQUESTED:
None
DISCUSSION:
• Following up on a question from last month regarding investment income, I reached out
to our investment broker(s) and have summarized the responses. Per GASB, we record
the interest and dividend income we receive (which is up from last year) and the market
adjustments to our investments (which is down from last year),to be transparent in what
our investments would be worth if we had to liquidate them at the date of the financial
statement. This is a bit of a challenge, as we do not intend to liquidate them until full
maturity and at that point we would not be recognizing a particular increase or decrease
to the investment. In this economic environment of rising interest rates, the investment
value declines. If it were necessary to liquidate,there is less likelihood that someone will
purchase an investment with a lower interest rate when they could purchase an
investment with a higher interest rate, and so in order to liquidate, an enticement must be
offered- and that enticement is a reduction in the principal to the seller. Our market
adjustments we are recognizing on a monthly basis are a short term hiccup and really
only a true impact if we had to sell the entire portfolio TODAY.
• Troy and I will be meeting with our auditors next week, September 19, 2017 for their
annual visit with us. This is an opportunity to discuss issues, evaluate customer
satisfaction, and pro-actively prepare for upcoming changes.
• The annual Member Information Conference (MIC)provided by NISC is at the end of
this month, September 25—28, 2017. We annually send the Customer Service Manager,
a Customer Service Representative, and the Inventory Person; we will also be sending an
Accountant,the PR/AP Specialist, and the Technical Services Superintendent.
• We have received our insurance renewals and increases for 2018: Health Insurance 5%,
Dental Insurance 13.6%, Long Term Disability Insurance 24.62%, Life Insurance 37.5%,
and AD&D and Dependent Life Insurance 0%. We have a Wage &Benefits Committee
(WBC)meeting scheduled right before the commission meeting to discuss our approach
for these items in the coming year, and to schedule subsequent meetings.
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