10-09-2001 ERMU MIN ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
October 9, 2001
Members Present: George Zabee, President; James Tralle, Vice Chair; John Dietz, Trustee
Staff Present: Bryan Adams, General Manager; Glenn Sundeen, Line Superintendent; David Berg, Water
Superintendent; Patricia Hemza, Office Manager
Others Present: Pat Klaers, City Administrator
1. Call meeting to order October 9, 2001
2. Consider Utilities Agenda
Bryan Adams has one additional item regarding street lights, and James Tralle an item regarding the
possibility of recession.
James Tralle moved to approve the Utilities Agenda for October 9, 2001, with two additional items to be
discussed under Other business. John Dietz seconded the motion. Motion carried 3-0.
3. Consider Consent Agenda
James Tralle moved to approve the Consent Agenda as follows:
September Check Register
Financials
September 12, 2001 Minutes
5.1 Review Great River Energy's Proposed 2002 Electric Wholesale Rate
Bryan Adams discussed the proposed wholesale electric rate for 2002. The demand rates for Winter,
Summer, and the Spring/Fall months decrease approximately 2%, and the energy rate increases 16%. The 3
year phase-in credit expires in 2001, resulting a net affect of an 8.967% increase, based upon projected demand
and energy requirements for 2002. The rate has not yet been formalized, and may change. Staff and
Commission discussed alternatives to adjust the wholesale rate with the retail rates the customers are charged.
A fuel cost adjustment and a power cost adjustment were discussed. Commission favors a rate increase rather
than a fuel cost adjustment. It is perceived by Commission that a rate increase is more straight forward for the
customer.
The Conservation Improvement Program is expected to be provided by Great River Energy,but details at this
time are not finalized.
5.2 Review Results of$3,590,000 G.O.Water Revenue Bonds
The results of the $3,590,000 GO Water Revenue Bonds to finance Water Production Facility#7, and
the Eastern Water Tower were reviewed, showing that the true interest rate is 4.7327%. No action necessary.
Page 2
Regular meeting of the Elk River Municipal Utilities Commission
October 9, 2001
5.3 Review Proposed 2002 Expense Budget
Staff reviewed the proposed Electric and Water 2002 Expense Budgets with Commission. It is noted
that projections are difficult at this time because of the economical problems now being posed. Bryan Adams
noted that electric projections of 6% may be slightly conservative. The increase in water sales was assumed at
0%, due to the last two summers being extremely dry. The continuing decline of profits in the electric
department was discussed. A general discussion of line items followed for both Electric and Water Budgets,
with comments from Staff and Commission. No action necessary at this time.
5.4 Update proposed 2002 Capital Budget
Two projects proposed to be completed over a two year time frame, now may be required in 2002.
The realignment of Proctor Avenue by County Road 33, and the highway interchange at County Road 33 and
Highway 169 will require relocation of electric feeders to serve the northern portions of Elk River. Instead of
temporarily relocating these feeders and then locating them to a permanent location, Staff recommended
completing Substation North, one year earlier. This will utilize the substation to feed northern Elk River. The
North Substation will need to be completed in 2002 to allow the revised feeder plan to be finished. The plan
adds $550,000 to the 2002 capital budget.
The second project is providing adequate water service to west Elk River. It would be difficult to serve
the expanding western area with water service without system improvements. It will be necessary to move a
booster station in the Meadowvale Road area and provide another water main crossing under Highway 10. The
plan adds $80,000.00 to the 2002 capital budget.
Staff and Commission discussed the option. John Dietz and James Tralle noted their approval of
moving the entire projects to 2002.
John Dietz moved to approve the changes in the 2002 Capital Budget regarding the proposed
realignment of Proctor Avenue, and the water service to western Elk River. James Tralle seconded the motion.
Motion carried 3-0.
5.5 Antenna on Utility Water Tower
Bryan Adams reviewed the history of the request for a cellular phone antenna on water towers from
Sprint. George Zabee reported on his conversation with Sprint. It was decided that since Sprint had not
responded with a formal request to be heard at a future meeting, no action would be necessary at this time.
5.6 Update Water Service Leak Assessment
Bryan Adams advised Commission that he would return to November meeting of the Utilities
Commission with changes in policy concerning waiver of assessment. Pat Klaers noted that the City is in the
process of rewording the Ordinance.
Page 3
Regular meeting of the Elk River Municipal Utilities Commission
October 9, 2001
5.7 Update Security System Program
Bryan Adams updated the Commission on the increased activity in the Security Department, and
reviewed customer numbers, security system activity, and the associated advertising. Discussion centered on
the possibility of expanding the department with contract persons for installation and sales. John Dietz asked if
the future for security systems is positive. James Tralle asked about the Personal Lifesaver system the Utilities
is able to provide. No action necessary.
6.1 Consider Replacement of Electric Lineperson
A resignation from Andrew Reichwein, Apprentice Lineperson was presented with the request for
authorization from Commission to fill the position with another Apprentice Lineperson.
John Dietz moved to accept the resignation of Andrew Reichwein. James Tralle seconded the motion.
Motion carried 3-0.
James Tralle moved to authorize Staff to advertise, and hire an Apprentice Lineperson. John Dietz
seconded the motion. Motion carried 3-0.
6.2 Review and Consider Electric and Water Policy Changes
Bryan Adams presented policy changes in the Electric and Water Rules reflecting the following:
WATER
1. Requiring radio reading meters on new installation
2. Changing the meter costs to reflect radio read meters
3. There are no changes required to the repair of customer water service line if we allow the
repair expenses to be assessed to property taxes as a last recourse.
ELECTRIC
1. Eliminate $10.00 new account fee
2. Increase connect fee from $600 to $700 to reflect cost of radio read meters
3. Tighten up requirements on location of electric meters and utilize by-pass residential meter
sockets.
John Dietz moved to approve the policy changes as presented. James Tralle seconded the motion.
Motion carried 3-0.
Other Business
Commission received a Street Light Recommendation from the Street Lighting Committee to erect a
street light at 195`h Avenue/Irving Street. A short discussion of past practices was discussed.
James Tralle moved to approve the installation of a Street Light at 195`h Avenue/Irving Street. John
Dietz seconded the motion. Motion carried 3-0.
Page 4
Regular meeting of the Elk River Municipal Utilities Commission
October 9, 2001
A discussion of how recession would impact the Elk River Utilities. Commissioners and Staff reviewed
ways to make cut-backs, and offered opinions.
John Dietz directed Bryan Adams to work with Bruce West, Fire Chief on his Cable Message to citizens
regarding terrorism.
The next regularly scheduled meeting of the Elk River Municipal Utilities Commission will be Tuesday,
November 13, 2001 at 4:00 PM in the Elk River Utilities Offices.
Adjournment
President Zabee adjourned the meeting of the Elk River Municipal Utilities Commission at 5:45 PM.
Respectfully submitted,
Patricia Hemza
Office Manager