6.1a ERMUSR 12-12-2017 Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Troy Adams, P.E. —General Manager
MEETING DATE: AGENDA ITEM NUMBER:
December 12, 2017 6.1a
SUBJECT:
Staff Update
ACTION REQUESTED:
None
DISCUSSION:
• The Board of Directors of the Minnesota Municipal Power Agency (MMPA) met on
November 28, 2017 at the offices of Shakopee Public Utilities in Shakopee, Minnesota. I
attended, but Commissioner Al Nadeau was not able to attend as ERMU's alternative
representative.
Customer penetration of MMPA's Clean Energy Choice program for residential
customers increased to 2.3%, with a range of market penetration by member of 0.7%to
5.4%. Several cities have also signed up customers for the Clean Energy Choice for
Business program, with more cities indicating the customers have expressed interest in
the program. The Board also discussed the status of the renewable projects that the
Agency is pursuing.
Attached are an income statement and balance sheet for MMPA's 3Q2017. The financials
have not been audited.
• The cyber and physical security assessment was completed by FRSecure in November.
An in-person report was given by FRSecure to the newly created Information Security
Committee on November 29. As you may recall, this Committee was created as a joint
review committee between the Utilities and the City. ERMU Commissioner Mary
Stewart was elected Chair of this Committee.
The assessment covered multiple categories and was separated into independent reports
for the Utilities and City. These reports include industry best practice action
recommendations. The report did not identify any immediate critical action items or
capital purchases which would require budget amendments for the 2018 ERMU budget.
Staff will review the reports and the recommendations and reconvene the Committee to
discuss coordination and prioritization on relevant recommendations. A report to the
Commission will be provided in spring of 2018.
• I attended the second of two 2017 American Public Power Association(APPA) Reliable
Public Power Provider(RP3) Panel grading sessions. This grading session was held in
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Washington DC on December 4-5. As you may recall, I had been nominated and elected
to serve a 2-year term on this panel earlier this year and am one of 18 panelists servicing
from the more than 2,000 public power providers nationally.
ATTACHMENTS:
• Minnesota Municipal Power Agency Third Quarter 2017 Unaudited Financials
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14A
Minnesota Municipal Power Agency
Statement of Net Position
As of September 30,2017-Unaudited
Assets
Current assets:
Cash and cash equivalents $ 36,572,893
Restricted cash and cash equivalents 37,564,301
Accrued interest receivable 252,999
Power sales and other receivables 11,169,080
Fuel inventory 1,420,834
Plant inventory-spares 2,507,672
Prepaid expenses 815,479
Total current assets 90,303,258
Noncurrent assets:
Capital assets:
Electric generation assets 424,894,790
Land 7,066,719
Less accumulated depreciation (109,715,568)
Property and equipment,net 322,245,941
Construction in progress 2,073,760
Total capital assets,net 324,319,701
Restricted cash,cash equivalents,and investments 20,783,513
Prepaid expenses 777,088
Derivative instruments-futures 46,570
Future recoverable costs 44,008,042
Total noncurrent assets 389,934,914
Total assets 480,238,172
Deferred Outflows
Deferred outflows of resources 1,742,687
Total assets and deferred outflows of resources $ 481,980,859
Liabilities
Liabilities:
Current liabilities:
Accounts payable and accrued liabilities $ 10,317,998
Accrued interest payable 6,880,969
Long-term debt due within one year 9,113,333
Capital lease liability due within one year 958,005
Derivative instruments-futures 330,100
Total current liabilities 27,600,405
Long-term debt,net 306,514,456
Capital lease liability 18,269,574
Total noncurrent liabilities 324,784,030
Total liabilities 352,384,435
Deferred Inflows
Deferred inflows of resources-rate stabilization 33,071,000
Deferred inflows of resources-other 17,514,238
Total liabilities and deferred inflows of resources 402,969,673
Net Position
Net position:
Net investment in capital assets 17,255,095
Restricted for debt service 37,564,301
Unrestricted 24,191,790
Total net position 79,011,186
Total liabilities and deferred inflows of resources and net position $ 481,980,859
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Minnesota Municipal Power Agency
Statements of Revenues, Expenses and Changes in Net Position
YTD September 30, 2017 -Unaudited
Operating revenues—power sales to members $ 85,162,072
Operating revenues—power sales to non-members 985,519
Total operating revenues 86,147,591
Operating expenses:
Power acquisition expense 28,487,795
Transmission 13,769,370
Other operating expenses 17,631,964
Depreciation 10,331,460
Total operating expenses 70,220,589
Operating income (loss) 15,927,002
Nonoperating revenues(expenses):
Amortization of premium on long-term debt, net 847,251
Interest expense (10,766,745)
Investment income 918,058
Loss on disposition of property (917,155)
Net change in the fair value of investments (16,796)
Gain on sale of investments 144,273
Total nonoperating revenues(expenses), net (9,791,114)
Change in net position before future recoverable costs 6,135,888
Future recoverable costs 3,079,769
Change in net position 9,215,657
Total net position,beginning of year 69,795,529
Total net position, September 30, 2017 $ 79,011,186
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