07-11-2000 ERMU MIN ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
JULY 11, 2000
Members Present: John Dietz, President; George Zabee, Vice Chairman; James Tralle,
Trustee
Staff Present: Bryan Adams, General Manager; David Berg, Water Superintendent;
Patricia Hemza, Office Manager
1. Call meeting to order at 4:00 July 11. 2000
2. Consider Utilities Agenda
Bryan Adams has two additional items to be discussed under Other Business:
1. To ask authorization to explore purchasing 5% of purchased power on
the open market for August.
2. To explore an overture from John Plaisted concerning the building to
be constructed on the corner of King and Main.
James Tralle moved to approve the Utilities Agenda, with two additional items to
be discussed under Other Business. George Zabee seconded the motion. Motion carried
3-0.
3. Consider Consent Agenda
George Zabee asked two questions on the Check Register. John Dietz asked two
questions on the Financials, regarding pumping expense and WAC fees.
James Tralle moved to approve the Consent Agenda as follows:
June Check Register
Financials
Approval of the May 30, 2000 Special Meeting Minutes
George Zabee seconded the motion. Motion carried 3-0.
5.1 Review and Consider Main St.Water Main Installation Project
Bryan Adams reviewed the Main Street Water Main Project,previously discussed
at the May 30, 2000 Utilities Meeting. Howard R. Green Company prepared plans and
specifications, and secured bids to install water mains for the Main Street resurfacing
project. Bids were received on July 7, 2000 and presented at this time to the
Commission. The estimated costs for engineering and inspection for the project would
be approximately $39,000.00.
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Regular Meeting of the Elk River Municipal Utilities Commission
July 11, 2000
Due to the low bids, Staff recommended doing the complete project, instead of
the partial option, and completing the project in approximately two years through side
streets.
John Dietz reported on the considerations of the City Council regarding the
project, as well as further information about Main Street Parking.
James Tralle moved to proceed with all of the watermain improvements,
awarding the bid to Hardrives, Inc. at a total cost to the Utilities of$312,211.96 for the
watermain component of the original bid, with contingency construction engineering, and
field engineering to be added to total $365,000.00 for the project. George Zabee
seconded the motion. Motion carried 3-0.
5.2 Review and Consider Wind Energy Program
Bryan Adams reported on the wind generation program titled"Wellspring"
offered by Great River Energy. The "Wellspring" Program is being offered to ask
customers to become green energy pioneers by making a commitment to purchase wind
energy at an additional cost. The cost to customers would be at a rate of$2.00/100 kwh
block.
George Zabee moved to limit the participation by the Elk River Municipal
Utilities to offering brochures outlining the plan, and to enclose them as a stuffer in a
monthly billing. James Tralle seconded the motion. Motion carried 3-0.
5.3 Review Feasibility Study for Western Area Improvements Phase IV
The Amended Feasibility Study for the Western Area Improvements was
presented and reviewed. The Study reflects a modified design that leaves 185"'Avenue
unaffected. The water portion of this project will be paid through trunk assessments and
assessments to Hoyt Partners. No contribution from the Elk River Municipal Utilities
will be required. Construction is to be completed by Spring 2001.
John Dietz added comments regarding City Council considerations on the last
phase in the western area of the City.
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Regular Meeting of the Elk River Municipal Utilities Commission
July 11, 2000
6.2 Authorize Land Purchase for "North" Substation
The Elk River Municipal Utilities will be required to construct a 69kv/ 12.46 kv
substation in northern Elk River within the next two years, due to the continued growth
of the City. Bryan reviewed the criteria for the location of this substation, and enclosed a
map of Elk River which reflects the parcel of property that will satisfy demands. Bryan
further advised that an appraisal is currently being completed. Concerns with the one
acre conflict with current zoning requirements was discussed, with possible solution
arrived at.
George Zabee authorized the General Manager to negotiate the purchase of the
property, not to exceed$20,000.00 for one acre. James Tralle seconded the motion.
Motion carried 3-0.
6.2 Authorize Land Purchase for Well#7
Bryan Adams presented information and criteria for another water production
facility within the next two years,noting that the preferable location is in Eastern Elk
River, with a land area of approximately 1.5 acres. John Dietz questioned the School's
dependency upon the bond issue with regard to the purchase. He further asked if another
tower would be needed after the completion of this one. Bryan responded that another
tower would be needed, contingent upon City growth.
George Zabee moved to authorize the General manager to negotiate with the ISD
728 in purchasing suitable land for a future water production facility. James Tralle
seconded the motion. Motion carried 3-0.
6.3 Review and Consider ERMU Communication Strategy
A proposal from Anita Duckor of Duckor&Associates to do a Communication
Strategy and Brand Plan for the Elk River Municipal Utilities was presented and
reviewed. Staff is divided as to the necessity of the proposal. The General Manager
advises that he feels the Utility needs to maximize efforts in customer communications.
James Tralle added his concerns with over doing the information given to customers. He
also asked John Dietz about the City's involvement with the Duckor firm. John Dietz
feels the proposal is too costly at $10,000.00. Bryan Adams was requested to ask for
other options that would be less costly.
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Regular Meeting of the Elk River Municipal Utilities Commission
July 11, 2000
6.4 Review FEMA Requirements and Mutual Aid Agreements
Commission is advised that the Federal Emergency Management Agency
(FEMA)will no longer provide damage assistance funds to a city of municipal utility
assisting another city/utility unless there is a prior, written agreement between the
damaged party and the assisting party. A proposed blanket association agreement has
been prepared, and Staff recommends authorization to proceed with the Mutual Aid
Agreement.
George Zabee moved to authorize the General Manager to sign the Mutual Aid
Agreement regarding Federal Emergency Management Agency criteria. James Tralle
seconded the motion. Motion carried 3-0.
6.5 Review and Consider Water Economic Development Incentive Rate
Commission was advised that a proposal from Advanced Nutritionals Corporation
(ANC)to locate a facility in Elk River has been received by City Council. The facility
will process juice boxes, or like products. Depending upon the number of production
lines installed, the daily water consumption may vary from approximately 32,000 gallons
to 250,000 gallons. Due to the potential large water consumption, ANC has requested a
special water rate.
The Elk River Utilities Staff has proposed a Water Economic Development
Incentive Rate as follows: Base unit cost for first 2,000,000 gallons/month, 20%
discount of base unit cost above 2,000,000 gallons/month. Term of this special rate is
three years
John Dietz noted that the business will be an asset to the City. George Zabee and
James Tralle concurred. John Dietz further reported on the planned use of land adjacent
to the new ANC facility.
George Zabee moved to adopt the Water Economic Development Incentive Rate
(a copy of which, is attached to these minutes), as presented. James Tralle seconded the
motion. Motion carried 3-0.
Other Business
Bryan Adams advised the Commission that John Plaisted has inquired if the
Utilities would be interested in utilizing a share of the future building on the corner of
King and Main. Commission authorized Bryan Adams to further explore the possibility.
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Regular Meeting of the Elk River Municipal Utilities Commission
July 11, 2000
Bryan Adams explained that our Purchased Power Agreement allows the Utilities
to purchase 5% of our power in the market place. James Tralle moved to authorize
Bryan Adams to pursue the possible purchased power in the marketplace at a 5% amount.
George Zabee seconded the motion. Motion carried 3-0.
John Dietz inquired about the possibility of looking at excess usage of water.
Staff responded with examples of customer water usage on a residential and
commercial/industrial basis.
James Tralle queried Staff regarding the condition of MAPPS transmission
system. Bryan Adams responded to questions with facts and figures, as well as the
possible effects of unscheduled contingencies.
Bryan Adams advised the Commission on the subject of natural gas generation
turbines. Questions, answers and general comments followed.
The next scheduled meeting of the Elk River Municipal Utilities Commission will
be August 8, 2000 at 4:00 P.M. in the Utilities Offices.
James Tralle moved to adjourn the July 1, 2000 meeting. George Zabee seconded
the motion. Motion carried 3-0.
The July 11, 2000 meeting of the Elk River Utilities Commission adjourned at
5:20 P.M.
Respectfully submitted,
Patricia Hemza
Office Manager