Loading...
07-13-1999 ERMU MIN ELK RIVER MUNICIPAL UTILITIES REGULAR MEETING OF THE ELK RIVER UTILITIES COMMISSION HELD AT THE ELK RIVER MUNICIPAL UTILITIES OFFICE JULY 13, 1999 Members Present: President, James Tralle; Vice Chairman, John Dietz; Trustee, George Zabee Staff Present: Bryan Adams, General Manager; Glenn Sundeen, Line Superintendent; Robert McCartney, Water Superintendent; Patricia Hemza, Office Manager Others Present: Vance Zehringer, Customer Services Consultant 1. Call meeting to order at 4:00 P.M..July 13, 1999 2. Consider Utilities Agenda George Zabee moved to approve the Utilities Agenda, with one addition from Bryan Adams. James Tralle seconded the motion. Motion carried 2-0. 3. Consider Consent Agenda George Zabee moved to approve the Consent Agenda as follows: 6-8-99 Minutes June Check Register Financials John Dietz arrived at 4:10 P.M. 5.1 Review Final Results from Customer Visits Vance Zehringer presented his final report on the Key Account Visits he has made. He noted that in each case, these key accounts were very satisfied with the level of service and experiences they had in dealing with utility personnel, as well as the reliability of service. The area of concern in ten percent of those demand customers is the cost of electricity due to their low load factor. Various solutions were discussed between Staff and the Commission. James Tralle noted the fine job that is being done by Vance Zehringer, and expressed his appreciation. Page 2 Regular meeting of the Elk River Utilities Commission July 13, 1999 5.2 Review offering Motor-Lighting Rebates The possibility of offering energy audits and providing rebates on energy efficient lighting and motor retrofits was discussed. Staff and Vance Zehringer recommend offering a limited number of energy audits and provide rebates for the remainder of 1999. James Tralle moved to offer rebates of high efficiency lighting retrofits, motor retrofits, and energy audits, with a maximum expenditure to the ERMU of$5,000, limited to $1,500.00 per customer for the remainder of 1999. George Zabee seconded the motion. Motion carried 3-0. 5.3 Review Off Peak Electric Tariff Discussion of the present Off Peak Demand Tariff centered around the impact to the low load factor customers. Staff has reviewed the rate using several alternatives. Commission directed Staff to pursue additional analysis of the rate. James Tralle offered his support of a general decrease, rather than singling out the low load customers only. George Zabee would support a combination. John Dietz favors a re-working of the demand rate that will affect the low load customers. 6.1 Review& Consider Water Main Improvement A water quality and pressure problem at the West end of 5th Street NW,just north of Main Street and Tipton Avenue needs to be addressed at this time. The problem of a dead end main is the cause. James Tralle moved to extend the water main on 5th Avenue east and south to the water main at the intersection of Main Street and Tipton Avenue. George Zabee seconded the motion. Motion carried 3-0. 6.2 Review& Consider APPA Resolution A subject resolution and draft letters to our Senators and Representatives regarding electric re-structuring was presented. George Zabee moved to adopt the resolution as presented. John Dietz seconded the motion. Motion carried 3-0. (Copies attached to these minutes.) Page 3 Regular meeting of the Elk River Utilities Commission July 13, 1999 6.3 Review MMUA Rate Survey Results The MMUA 1998 Electric Rate Survey was presented along with an analysis of the data. The Elk River Municipal Utilities falls in the 3rd Quartile, indicating that considering the growth of our area and the territory acquisition, we are in a satisfactory position. Staff advises that the Commission needs to keep down- ward pressure on rates. Other Business Bryan Adams advised the Commission that Art Gatchell has had second thoughts on accepting the position of Water Superintendent. The next scheduled meeting of the Elk River Municipal Utilities Commission will be August 10, 1999. James Tralle moved to adjourn the July 13, 1999 Regular Meeting of the Elk River Municipal Utilities Commission. George Zabee seconded the motion. Motion carried 3-0. The July 13, 1999 meeting of the Elk River Municipal Utilities adjourned at 5:10 P.M. Respectfully submitted, 7e-e/A;Ola) Patricia Hemza Office Manager ELK RIVER MUNICIPAL UTILITIES 322 King Avenue Vt Elk River,Minnesota 55330 Phone (612)441-2020 ' Fax (612)441-8099 The Honorable James L. Oberstar United States House of Representatives Washington D.C.20515 Dear Representative James L.Oberstar: I am writing to encourage you to co-sponsor H.R. 721,the bipartisan Bond Fairness and Protection Act. This legislation is important to us in Elk River.The passage of this act is critical if the proposal restructuring of the electric industry is to take place. As the General Manager for Elk River Municipal Utilities,I am responsible for providing reliable service to approximately 14,000 customers. I take great pride in the fact that we are a community-run,not- for-profit provider of electricity where our consumers enjoy low rates and have a say in how our utility operates. Elk River currently does not have any tax exempt electric bonds,but other communities have decided over the last few years to issue tax-exempt bonds to improve their service to their consumers. We are very concerned now that our state is restructuring the electric industry and that a conflict exists between the federal tax laws governing the use of our tax-exempt bonds and the changing marketplace. I am writing to express our support for a fair and reasonable solution to these problems posed by the federal "private use" restrictions on public power bonds. The Hayworth-matsui bill, H.R. 721,was introduced in the 106`h Congress by Representatives J.D. Hayworth(R-AZ), Bob Matsui(D-CA), and a bipartisan group of representatives to resolve the "private use" issue. It provides us with options for obtaining the necessary level of relief needed to participate in competitive electricity markets without jeopardizing the tax-exempt status of outstanding bonds or raising rates. This bill is a compromise because in return for protecting outstanding bonds,we agree to make concessions on the future use of these bonds. Some of our opponents, however,want to amend this bill to tax public power revenues. Please oppose new taxes on us,which only serve to increase electricity costs. We are units of state and local government and operate on a not-for-profit basis—this bill protects our local decision making authority. Our 14,000 customers are counting on your support for this issue. Please write back and let me know if you plan to support this bill. And, I would be happy to meet with members of your staff to further discuss the issue. We appreciate your help on this matter. Best Regards, Bryan C.Adams, PE General Manager ELK RIVER MUNICIPAL UTILITIES 322 King Avenue Elk River,Minnesota 55330 Phone(612)441-2020 Fax(612)441-8099 The Honorable Senator Paul Wellstone 136 Hart Senate Office Building Washington D.C.20510 Dear Senator Paul Wellstone: I am writing to encourage you to co-sponsor S.386,the bipartisan Bond Fairness and Protection Act. This legislation is important to us in Elk River.The passage of this act is critical if the proposal restructuring of the electric industry is to take place. As the General Manager for Elk River Municipal Utilities,I am responsible for providing reliable service to approximately 14,000 customers. I take great pride in the fact that we are a community-run,not- for-profit provider of electricity where our consumers enjoy low rates and have a say in how our utility operates. Elk River currently does not have any tax exempt electric bonds,but other communities have decided over the last few years to issue tax-exempt bonds to improve their service to their consumers. We are very concerned now that our state is restructuring the electric industry and that a conflict exists between the federal tax laws governing the use of our tax-exempt bonds and the changing marketplace. I am writing to express our support for a fair and reasonable solution to these problems posed by the federal "private use"restrictions on public power bonds. The Gorton-Kerrey bill, S.386,was introduced in the 106`h Congress by Senators Slade Gorton(R- WA), Robert Kerrey(D-NE),and a bipartisan group of senators to resolve the"private use" issue. It provides us with options for obtaining the necessary level of relief needed to participate in competitive electricity markets without jeopardizing the tax-exempt status of outstanding bonds or raising rates.This bill is a compromise because in return for protecting outstanding bonds,we agree to make concessions on the future use of these bonds. Some of our opponents,however,want to amend this bill to tax public power revenues. Please oppose new taxes on us,which only serve to increase electricity costs. We are units of state and local government and operate on a not-for-profit basis—this bill protects our local decision making authority. Our 14,000 customers are counting on your support for this issue. Please write back and let me know if you plan to support this bill. And, I would be happy to meet with members of your staff to further discuss the issue. We appreciate your help on this matter. Best Regards, Bryan C.Adams, PE General Manager t ELK RIVER MUNICIPAL UTILITIES 322 King Avenue Elk River,Minnesota 55330 Phone (612)441-2020 Fax (612)441-8099 Resolution WHEREAS,every state,county,city or town in America should have the right to decide whether it wants to provide electric service to its businesses and residents. WHEREAS,the consumer-owners of these utilities should have a direct say in and maintain local control over their own electric utility operations and policies. WHEREAS, Elk River MN,established its community owned electric utility in 1947 and our citizens have benefited from this action for decades. WHEREAS,these community-owned utilities,as units of state or local government,have the right to issue tax-free municipal bonds for local infrastructure needs, including electric service. WHEREAS, there currently exist federal restrictions on municipal bonds used to develop community-owned electric utilities that prevent these utilities from selling power under many circumstances,and these restrictions will make it difficult, if not impossible, for many of these utilities to operate in the more competitive environment being fostered or mandated by new federal and state laws. WHEREAS,bipartisan legislation, the Bond Fairness and Protection Act,has been introduced in the Senate(S.386)by Senators Slade Gorton(R-WA)and Bob Kerrey(D-NE),and in the House of Representatives(H.R. 721)by Representatives Hayworth(R-AZ)and Matsui (D-CA)to reconcile these restrictions with the changing character of the electric utility industry in a way that protects our right of local control over our own affairs. WHEREAS,some private power companies oppose this legislation precisely because it is in their self interest to limit the ability of community-owned utilities to operate in this new environment. WHEREAS,opponents of S.386 and H.R. 721 are urging Congress to impose a federal income tax on certain revenues from sales of community-owned electric utilities. WHEREAS,community-owned utilities such as Elk River Municipal Utilities,as units of state and local government operating on a not-for-profit basis,are not and should not be taxed by the federal government NOW,THEREFORE, BE IT RESOLVED: that Elk River Municipal Utilities Commission call on Senators Wellstone and Grams and Representative Oberstar to support the bipartisan Bond Fairness and Protection Act of 1999,and to vigorously oppose any federal tax on community-owned electric utilities. Elk River Municipal Utilities Commission James Tralle John Deitz George Zabee 1/4 ELK RIVER MUNICIPAL UTILITIES 322 King Avenue Elk River,Minnesota 55330 Phone (612) 441-2020 Fax (612)441-8099 The Honorable Senator Rod Grams 26 I Dirksen Senate Office Building Washington D.C. 20510 Dear Senator Rqd Grams: I am writing to encourage you to co-sponsor S.386,the bipartisan Bond Fairness and Protection Act.This legislation is important to us in Elk River. The passage of this act is critical if the proposal restructuring of the electric industry is to take place. As the General Manager for Elk River Municipal Utilities, I am responsible for providing reliable service to approximately 14,000 customers. I take great pride in the fact that we are a community-run,not- for-profit provider of electricity where our consumers enjoy low rates and have a say in how our utility operates. Elk River currently does not have any tax exempt electric bonds, but other communities have decided over the last few years to issue tax-exempt bonds to improve their service to their consumers. We are very concerned now that our state is restructuring the electric industry and that a conflict exists between the federal tax laws governing the use of our tax-exempt bonds and the changing marketplace. I am writing to express our support for a fair and reasonable solution to these problems posed by the federal ?' "private use"restrictions on public power bonds. The Gorton-Kerrey bill, S.386,was introduced in the 106`h Congress by Senators Slade Gorton(R- WA), Robert Kerrey(D-NE), and a bipartisan group of senators to resolve the"private use"issue. It provides us with options for obtaining the necessary level of relief needed to participate in competitive electricity markets without jeopardizing the tax-exempt status of outstanding bonds or raising rates. This bill is a compromise because in return for protecting outstanding bonds,we agree to make concessions on the future use of these bonds. Some of our opponents,however, want to amend this bill to tax public power revenues. Please oppose new taxes on us,which only serve to increase electricity costs. We are units of state and local government and operate on a not-for-profit basis—this bill protects our local decision making authority. Our 14,000 customers are counting on your support for this issue. Please write back and let me know if you plan to support this bill. And, I would be happy to meet with members of your staff to further discuss the issue. We appreciate your help on this matter. Best Regards, Bryan C. Adams, PE General Manager