05-08-2018 ERMU MIN ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
HELD AT UTILITIES CONFERENCE ROOM
May 8,2018
Members Present: Chair John Dietz;Vice Chair Al Nadeau; Commissioners Paul Bell,
Mary Stewart,and Matt Westgaard
ERMU Staff Present: Troy Adams,General Manager;
Theresa Slominski,Finance and Office Manager;
Mark Fuchs,Electric Superintendent;
Mike Tietz, Technical Services Superintendent;
Eric Volk,Water Superintendent;
Tom Sagstetter,Conservation&Key Accounts Manager;
Michelle Canterbury,Executive Administrative Assistant;
Jennie Nelson,Customer Service Manager
Others Present: Cal Portner, City Administrator;Peter Beck,Attorney; Zack Carlton,City
Planning Manager
1.0 GOVERNANCE
1.1 Call Meeting to Order
The regular meeting of the Utilities Commission was called to order at 3:30 p.m.by Chair Dietz.
1.2 Pledge of Allegiance
The Pledge of Allegiance was recited.
1.3 Consider the Agenda
Chair Dietz stated he would like to move agenda item 5.3,Jackson Street Water Tower Grant and
Rehabilitation Update to right before the Consent Agenda.
Moved by Commissioner Westgaard and seconded by Commissioner Stewart to approve the
amended May 8,2018,agenda. Motion carried 5-0.
1.4 Recognition of APPA Certificate of Excellence in Reliability
Mr. Tietz was pleased to announce that ERMU recently received national recognition from the
American Public Power Association(APPA)for achieving exceptional electric reliability in 2017.
He shared that we were one of 128 public power utilities to receive this honor.According to the
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numbers for 2017,ERMU's System Average Interruption Duration Index(SAIDI)was only 17
minutes,compared to the industry average of 129 minutes.There was discussion on communicating
these impressive stats to the public.
1.5 Recognition of 2018 APPA Lineworker Rodeo Team
Mr.Fuchs introduced and recognized the lineworkers who participated in the 2018 Lineworkers
Rodeo. ERMU had one team of lineworkers that competed;the team consisted of Zac Johnson,
Matt Schwartz,and Curt Wark. Matt and Zac shared a little bit about the five timed events the team
competed in.Zac commented that another benefit of participating in the rodeo is the networking that
takes place,and the sharing of information on the latest techniques being used in the field.There
was discussion. Curt added that it was a really good team building experience,and overall a great
experience.Mr.Adams stated that he had put together a video of our lineworkers competing at the
event,but due to technical difficulties it couldn't be presented at the meeting.He noted that pictures
and videos of the event had been added to ERMU's Twitter and Facebook page.The Commission
congratulated the lineworkers on a job well done.
5.1 Jackson Street Water Tower Grant and Rehabilitation Update
Mr. Carlton,Planning Manager with the City of Elk River,was present and provided an update on
the restoration status of the Jackson Street Water Tower.The city has been working with Kodet
Architectural Group to prepare architectural plans and restoration estimates for the water tower.
They received estimates for three different restoration options,and based on Council direction have
chosen to go with option 1,which includes pressure washing the tower,fixing the structural
deficiencies,and repainting the tower.The cost for the project will be roughly$133,000.Mr.
Carlton provided some information on the grant application process and the deadlines.He explained
that although the grant doesn't require a match,it's encouraged the applicant contribute something
towards it.ERMU has agreed to provide a 20%match.There was discussion.
Mr.Adams pointed out that the timing of this restoration coincides with the 100 year anniversary of
the water system that was established in 1919,and the water tower that was built in 1920.He
suggested we do something to commemorate the anniversary.Mr.Carlton stated that he would also
be working with the Elk River Heritage Preservation Commission(HPC)to draft some plans to
improve the park surrounding the water tower;this would be implemented once the restoration is
complete.
As ERMU currently owns the water tower and the lot,Commissioner Westgaard asked if the intent
was to deed it to the city,and the city take over the restoration of the tower and any future
maintenance obligations.Mr.Adams replied that would be staff's recommendation.
At last night's City Council meeting,Chair Dietz had shared with the Council that ERMU had set
aside$90,000 to either repair or tear down the water tower. The question was posed, if they receive
the grant,would ERMU be willing to transfer the remaining funds,after the match,into some type
of maintenance fund that the city could use towards future maintenance costs.As ERMU had
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Regular Meeting of the Elk River Municipal Utilities Commission
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anticipated spending the$90,000 to tear down the tower,Mr.Adams indicated that this would be a
viable option,and added that this would ultimately be a Commission decision.
2.0 CONSENT AGENDA(Approved By One Motion)
Moved by Commissioner Nadeau and seconded by Commissioner Stewart to approve the
Consent Agenda as follows:
2.1 April Check Register
2.2 April 10,2018 Regular Meeting Minutes
2.3 April 10,2018 Special Meeting Minutes
2.4 Resolution Electing Not to Waive Statutory Tort Limits for Liability Insurance
2.5 Elk River Municipal Utilities/Connexus Energy—Joint Request for MN Public Utilities
Commission Modification of the Parties' Electric Service Territory Boundary
2.6 2018 First Quarter Utilities Performance Metrics Scorecard Statistics
Motion carried 5-0.
3.0 OPEN FORUM
No one appeared for open forum.
4.0 POLICY&COMPLIANCE
4.1 Multi-Billing Cycle Grace Period
Ms.Nelson provided some background on the multi-billing cycle that was implemented in
January, which resulted in customers due dates potentially fluctuating by a few days depending
on how many days were in that month. Based on customer feedback, staff recognizes that the
fluctuating due dates have been a difficult change for some customers and have been looking
into options to help alleviate their frustrations. Ms.Nelson began by explaining why there was
a fluctuating due date. She explained that currently penalties are applied the next day following
the due date, and what staff is proposing is implementing a grace period of up to six days after
the due date before applying penalties. She stated that having this tool would allow for much
smoother conversations with our customers and would show that we value their feedback. Mr.
Adams added that by implementing a six day grace period versus a fixed billing date, it will
still work with the workflow processes that have been put into place. The Commission had a
few questions. Staff responded.
Commissioner Stewart commented that maybe we should let some time go by to allow for
people to adjust before we implement any changes. Staff responded that was their original
intent, but based on the negative feedback they determined it would best be addressed right
now. Also,the addition of a grace period is something staff has been considering for some
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time. There was discussion.
Based on the negative comments posted on social media regarding the billing change, it was
asked why we don't engage on social media. Mr. Adams addressed this issue and commented
if there's a legitimate problem staff will reach out in a more productive manner with either a
phone call or email. There was further discussion. As much of the backlash occurred after the
Cold Weather Rule shut-offs,the Commission asked staff to walk them though the shut-off
process and the notifications that take place prior to it. Mr. Tietz and Ms.Nelson responded.
Moved by Commissioner Bell and seconded by Commissioner Westgaard to approve the
revised Service Policies Policy. Motion carried 5-0.
5.0 BUSINESS ACTION
5.1 Financial Report—March 2018
Ms. Slominski presented the March 2018 financial report as outlined in her memo. For the
Electric Department, she noted that the operating revenue had increased from the prior year,
and shared some of the factors that may have contributed to the increase, including the change
in billing cycles. She went on to state that it is also the change in billing cycles that makes the
data hard to compare year to year. Ms. Slominski pointed out the monthly electric demand and
monthly energy purchases graphs included in the report and stated what a great tool they are
for making comparisons from this year to last as the data is static. She explained that the
reporting period is the calendar month, and the data being measured is coming from a
substation and not the billing system. It was noted there were similar graphs for the water
department.
Ms. Slominski went over the summary Electric Statement in great detail. For the expenses she
noted that just as last month, we have the largest variance in the Maintenance Expense line
item,this is due to Tree Trimming, Electric Mapping, Meter Maintenance, and Transportation
Expenses. She provided further explanation on each of these expenses. Ms. Slominski also
spoke to some changes with the Travel Expense line item and the UPMIC Distribution line
item.
For the Water Department,there was also an increase in revenue dollars over the prior year.
Ms. Slominski explained that this could be due to an increase in customer base and improved
billing processes. YTD total revenues were down from the prior year; staff shared that this is
largely attributed to a decrease in connection fees due to the prolonged winter. For the Water
Department Miscellaneous Revenue line item, Chair Dietz asked why it was down $53,000.
Commissioner Westgaard stated that according to page 71 of the detailed Water Statement that
the Contributions from Developers reflected a$55,000 swing from this year to last. Ms.
Slominski shared that last year we had a city transfer for a water main and that was recognized
in this line item as a contribution of assets.
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Regular Meeting of the Elk River Municipal Utilities Commission
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Moved by Commissioner Westgaard and seconded by Commissioner Stewart to receive
and file the March 2018 Financial Report. Motion carried 5-0.
5.2 2018 First Quarter Delinquent Items
Ms. Slominski explained the difference between the four different categories of delinquents;
assessments, collections, revenue recapture, and write-offs. She then presented the delinquent
items for the first quarter which included a delinquent amounts listing report totaling$9,644.99
for all services. She also presented the delinquent items comparisons for 2017/2018,
identifying the categories and running totals. The amount for the first quarter write-offs was
$3,383.61. Ms. Slominski shared that our totals for the year for collections and write-offs are
well below the national average, at .0083%.
Moved by Commissioner Stewart and seconded by Commissioner Nadeau to approve the
First Quarter Delinquent Items Submitted. Motion carried 5-0.
6.0 BUSINESS DISCUSSION
6.1 Staff Updates
hi his staff report,Mr.Adams shared that his annual performance evaluation would be conducted
during a closed session at the June 12 Commission meeting.Ms.Canterbury spoke to the
communications that would be taking place prior to the meeting regarding the survey evaluation to
be completed by the Commissioners via SurveyMonkey. She stated that the deadline to complete
the survey would be May 24.
Mr.Adams noted that MMUA held their annual Legislative Conference April 11-12.As
Commissioner Westgaard had the opportunity to also attend the event,Mr.Adams asked if there
was anything he'd like to share about the experience. Commissioner Westgaard shared that the
conference was good,and it was nice to have some facetime with our local legislators to discuss the
key messages and talking points.Mr.Adams added that they were able to meet with both
Representative Zerwas and Senator Kiffmeyer,and made a point to thank them for their roles in
passing legislation to expand the ERMU Commission from three to five members.
Mr. Sagstetter informed the Commission that we should be taking delivery of the Chevy Bolt
sometime this week. Chair Dietz commented that according to the staff report, it appears that there
have been fewer charging sessions at the public charging stations.Mr. Sagstetter responded that it
may have to do with the new connection fees and time of use rates that were implemented mid-
April.There was discussion.
6.2 Future Planning
Chair Dietz announced the following:
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a. Regular Commission Meeting—June 12, 2018
Commissioner Westgaard announced that he would be unable to attend the June meeting. As
Mr. Adams' performance evaluation was also scheduled to take place at a closed session at that
meeting, he reached out to the Commission and Mr. Adams to determine if they would want to
proceed forward without him in attendance, or push it out to July. After discussion, consensus
was to wait until the July meeting.
6.3 Other Business
There was no other business.
7.0 ADJOURN REGULAR MEETING
Moved by Commissioner Westgaard and seconded by Commissioner Bell to adjourn the
regular meeting of the Elk River Municipal Utilities Commission at 4:48 p.m.Motion carried
5-0.
Minutes prepared by Michelle Canterbury.
_ fite
o, J P ietz,E' '• ission Chair
Tina Allard,
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Regular Meeting of the Elk River Municipal Utilities Commission
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