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05-14-2002 ERMU MIN ELK RIVER MUNICIPAL UTILITIES REGULAR MEETING OF THE ELK RIVER MUNICIPAL UTILITIES COMMISSION May 14, 2002 Members Present: James Tralle, President; John Dietz, Vice Chair; George Zabee, Trustee Staff Present: Bryan Adams, General Manager; Glenn Sundeen, Line Superintendent; David Berg, Water Superintendent; Patricia Hemza, Office Manager Others Present: Kurt Kragness, and Pat Dwyer, of the Heritage Committee, Vance Zehringer Other Employees Present: Richard Wagner, Wade Lovelette, Mark Fuchs, Michael Thiry 1. Call meeting to order President James Tralle called the meeting to order at 4:00 PM on May, 14, 2002. 2. Consider Utilities Agenda George Zabee moved to approve the Utilities Agenda for May 14, 2002, with two additional items from Bryan Adams, to be discussed under Other Business. John Dietz seconded the motion. Motion carried 3-0. George Zabee moved to approve the Consent Agenda as follows: April 2002 Check Register April 9, 2002 Minutes Financial Reports 5.1 Project Update Bryan Adams updated the Commission on the status of the following projects: Eastern Water Tower Water Treatment Plant#7 Substation North LFG Project Power Plant Garage Administration Building at City Hall Misc. Water Projects Misc. Electric Issues The importance of these large projects was stressed by Bryan Adams, and he urged the Commission to take a tour of these large projects at a future meeting. Page 2 Regular meeting of the Elk River Municipal Utilities Commission May 14, 2002 5.2 Update Jackson Street Water Tower The Elk River Utility Commission authorized the demolition of the Jackson Street Water Tower at the March 12, 2002 meeting. The Heritage Preservation Commission appeared before the Commission to request delay. They explained that they would like to have the Tower saved for its historical significance, as the first tower erected in Elk River, providing water to the citizens. Pat Dwyer advised that there are discussions taking place regarding the use of the tower as a receptacle for cell phone antennaes. The plan could generate approximately $10,000.00 to $12,000.00 annually,to help with the upkeep of the tower. Bryan Adams further explained that the property adjacent to the tower will be developed, which will make access to the tower difficult. Glenn Sundeen concurred. James Tralle advised that he would be willing to wait until the Heritage Committee returns with firm plans. George Zabee has offered to sell the tower for$1.00, to some other entity, relieving the ERMU of maintenance problems. John Dietz inquired as to expenses in the maintenance of the tower. Staff responded by saying that the tower would need painting on a regular ten to twelve year schedule, and that the ladder and cage are in need of repair at the present time. Bryan was directed by the Commission to meet with Mr. Dwyer, and his contacts, regarding the use of the tower. Mr. Kragness reiterated the viewpoint of the Heritage Preservation Committee for saving the Jackson Street Water Tower. Bryan Adams will return to the Commission at a future meeting, with his findings. 5.3 Update CIP Programs Vance Zehringer updated the Commission on fifteen Conservation Improvement Programs (CIP) that have been submitted to Great River Energy for inclusion in their report to the Department of Commerce, and the State Legislature. Draft brochures for the new programs were reviewed, as well as two additional programs. James Tralle asked if Connexus has similar programs. The budget for the expenditures for CIP were reviewed, along with the yearly requirements. 5.4 Review Water Brochures The 2001 Annual Drinking Water Quality Report, Water Conservation Brochures, and a Water Your Lawn Wisely advisory were reviewed and discussed. The Water Quality Report is required by federal regulation disclosing any water contaminants. The last two brochures deal with making our water customers more sensitive to the need for water conservation. Page 3 Regular meeting of the Elk River Municipal Utilities Commission May 14, 2002 5.5 Review and Consider Employee Compensation Bryan explained the request by the operational employees of the ERMU for annual compensation increases, an increase in re-connect pay, and a matching employee, employer 457 Deferred Compensation Plan. Four Options were presented. John Dietz asked if the operational employees, and the administrative employees have always been dealt with at the same time. Glenn Sundeen replied that prior to 1996, the operational employees were reviewed on June 1, and the administrative employees on January 1. He added that the second negotiation was merely a continuation of the settlement set forth on June 1. James Tralle asked if the three requests should be discussed separately. George Zabee moved to raise the re-connect pay from $35.00 to $50.00. John Dietz seconded the motion. Motion carried 3-0. Discussion resumed, with comments from Staff, Commission, and employees. John Dietz does not like breaking down the increases between the cost of living, and market adjustment, as stated on the Options. George Zabee voiced his opposition to the extra retirement benefit, and further feels that true labor costs are not being scrutinized, such as PERA, and FICA. Bryan Adams explains why he is in favor of the additional retirement plan. Surveys of other Utilities show that the plan is being instituted by the majority. John Dietz indicated that he would prefer Option 3, George Zabee indicates his indecision, and James Tralle is leaning toward the Option 2. James Tralle moved to adopt Option 2 for the ERMU 2002-2003 salary increases, with the additional retirement plan. Motion died for lack of a second. Richard Wagner spoke on behalf of non-administrative, and non-linemen employees, questioning the difference in percentage increases, and stating that he feels the practice is unfair. He expressed his view that since the employee share of health coverage was raised, he had not received a pay increase to make up for the increase. George Zabee responded again that he feels compensation is fair, adequate, and reasonable. James Tralle wondered about the cost of a four year training of an apprentice, and feels that if ERMU does not offer the 457 option, that ERMU could become a training ground for other Utilities. George Zabee disagreed, saying that he feels ERMU salaries are very good, and sufficient, and that PERA is an excellent retirement plan. Michael Thiry added that he feels the employees requests have always been fair, and that they only want to be treated with increases to meet the metro average. James Tralle moved to approve the request for the additional 457 Deferred Compensation Plan in the amount of$1,000.00 matching employer-employee contribution. Motion died for lack of second. Page 4 Regular meeting of the Elk River Municipal Utilities Commission May 14, 2002 James Tralle moved to adopt Option 2 of the 2002-2003 Salary Increase Options, without the additional 457 plan. George Zabee seconded the motion. Motion carried 2-1. John Dietz voting nae. 5.6 Review On Call Reporting Distance Presently, the ERMU employee handbook requires the On-Call employees to live within a 10 mile radius of the power plant. Exceptions will be heard by the Utilities' Commission. An employee has made a request to buy a house 10.3 miles from the power plant. Verification has been made, that the paging system and on-call cell phone has good reception at proposed residence. John Dietz moved to approve the request for an exception to the 10 mile radius of the power plant. George Zabee seconded the motion. Motion carried 3-0. 5.7 Booster Station—Easement vs. Purchase During the process of recording the deed for property acquired to relocate a booster station, it was discovered that there were additional requirements for land purchase, including a certificate of survey, and variances from the Planning Commission and City Council because the lot size is less than 122,000 square feet. An alternative to the restrictions would be to obtain an easement, rather than purchase. The land owners have agreed to an easement at the same price as the purchase, in the amount of$3,500.00. John Dietz moved to approve changing the purchase of the property to relocate a water booster station to an easement, at the agreed upon price of$3,500.00. George Zabee seconded the motion. Motion carried 3-0. 6.1 Review Snowbird Water Policy The policy of ERMU has been to render water accounts, as well as sewer charges inactive for people who leave for the winter months. The policy is unwritten at this time. Commission, and Staff discussed the policy. James Tralle moved to discontinue the policy of rendering water, and sewer accounts inactive during the months customers are away from their homes. John Dietz seconded the motion. Motion carried 3-0. Page 5 Regular meeting of the Elk River Municipal Utilities Commission May 14, 2002 6.2 Review MN Department of Health Inspection Report Staff presented the Minnesota Department of Health (MDH)report reflecting their routine inspection of the ERMU water system, and advising that no deficiencies were found. Bryan Adams noted that Dave Berg should be commended for his work in the department. Bryan Adams further spoke of developments, either in the planning stages, or in development, that affect the ERMU Water Department's need for future wells. Staff urged the Commission to consider property purchases for additional wells,before it becomes critical. Several options, and ideas were explored, and the consensus was that ERMU would not lose by purchasing property in advance of the need. Commission authorized Bryan Adams to begin the search for property. John Diez asked Bryan to discuss the topic of land for wells, with the City Council. John Dietz indicated that perhaps well property could be part of the development process. Other Business Copies of samples of the new utility bills were distributed, and Commission advised that the new bills would be used for the May 25, 2002 mailing. Bryan Adams reported that the 1992 line truck needs extensive repairs. Staff is requesting authorization to write specifications ahead of the schedule, so that the truck could be ordered and delivered in early 2003. Authorization was given. John Dietz reported that he had talked with Phil Hals about vehicle work being done for the Utilities at the City Garage. Phil Hals believed that things were going well, but was concerned about regular maintenance records being kept on the vehicles. Glenn Sundeen replied that he feels the Utilities are taking a back seat to other City departments, and that he received faster turn around time from outside sources. The next regularly scheduled meeting of the Elk River Municipal Utilities Commission will be June 4, 2002 at 4:00 in the Utilities offices. James Tralle adjourned the meeting of the Elk River Municipal Utilities Commission at 6:00 PM. Respectfully submitted, c;222-tc e.- -/--6t__J. )•'g Patricia Hemza Office Manager