2.2 ERMUSR 10-09-2018 ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
HELD AT UTILITIES CONFERENCE ROOM
September 11,2018
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 Manager
Others Present: Peter Beck,Attorney
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
There were no additions or corrections to the agenda.
Moved by Commissioner Westgaard and seconded by Commissioner Nadeau to approve the
September 11,2018,agenda. Motion carried 5-0.
1.4 Resolution Recognizing 2018 Public Power Week
A resolution recognizing 2018 Public Power Week was presented.
Moved by Commissioner Bell and seconded by Commissioner Stewart to adopt Resolution 18-
11 Recognizing 2018 Public Power Week. Motion carried 5-0.
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1.5 Resolution Recognizing 2018 Customer Service Week
A resolution recognizing 2018 Customer Service Week was presented.
Moved by Commissioner Westgaard and seconded by Commissioner Nadeau to adopt
Resolution 18-12 Recognizing 2018 Customer Service Week. Motion carried 5-0.
1.6 Recognition of Awards
Mr.Adams announced that Mr.Fuchs recently received the Minnesota Municipal Utilities
Association(MMUA)Distinguished Service Award which is given to individuals who perform
outstanding service in support of the association and its goals.Mr.Adams shared some kind words
about Mr.Fuchs and how deserving he was of the award. Mr.Adams was also recognized for six
years of service on the MMUA Board of Directors.
2.0 CONSENT AGENDA(Approved By One Motion)
For the check register, Chair Dietz had a question on why there were two payments to Connexus
Energy for our purchased power in the month of August.Ms. Slominski responded that she thought
that the one that was entered on August 2 was for the month of July,and that the other was for the
month of August. She stated that she would confirm and report back to the Commission.
Commissioner Stewart noted one typo in the employee handbook on page 75,first paragraph,
second sentence;where the word Employer's should be employee's. Staff stated they would make
the revision.
Moved by Commissioner Nadeau and seconded by Commissioner Stewart to approve the
Consent Agenda as follows,to include the revision identified above:
2.1 August Check Register
2.2 August 14,2018 Regular Meeting Minutes
2.3 August 29,2018 Special Meeting Minutes
2.4 Employee Handbook Annual Updates
Motion carried 5-0.
3.0 OPEN FORUM
No one appeared for open forum.
4.0 POLICY&COMPLIANCE
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There was nothing presented for policy&compliance.
5.0 BUSINESS ACTION
5.1 Financial Report—July 2018
Ms. Slominski presented the July 2018 financial report.
Moved by Commissioner Nadeau and seconded by Commissioner Stewart to receive and
file the July 2018 Financial Report. Motion carried 5-0.
5.2 2019 Budget/Business Plan— 10 Year Capital Projections; Capital Projects and
Equipment Purchases; and Conservation Improvement Program
Ms. Slominski noted that the Conservation Improvement Program (CIP)budget is not included
this month, and explained that due to the transition to the new power provider and the change
in programs, more time is needed to properly analyze and formulate the budgetary impacts.
Ms. Slominski presented the preliminary 2019 Capital Improvement Projections; Capital
Projects and Equipment Purchases; and Capital Project Time Schedules.
Notable items for the Electric Department are constructing a storage building for relocating
equipment temporarily to facilitate the future construction of a new field services facility as
well as storing seasonal equipment, a development infrastructure feeder for Miske Meadows,
electric service territory transfer costs, replacing bucket truck#8, and replacing the Vactron.
The Commission had a few questions. Staff responded. For the $75,000 that was budgeted for
County Road 13 roundabouts,there was discussion on road-right-away and who is responsible
for the expenses associated with moving utility infrastructure. Mr. Adams commented on the
trucks that are being budgeted for in 2019 and 2020. He pointed out that we have held the line
for quite some time on the replacement of bucket and digger trucks, and we're now at the point
where we're going to need to do one a year for the next few years. Mr. Fuchs explained the
rotation and replacement process for the trucks. The Electric Department Capital Project Time
Schedule was presented. There was discussion on the YAC substation slated for 2021, and the
$5,000,000 placeholder for an additional substation with changed voltage in 2025.
Notable items for the Water Department are the Auburn Water Tower reconditioning, and a
building at well #8 for housing SCADA equipment. Mr. Volk spoke to the $25,000 that was
budgeted for the Urban Services District Study and shared that it would be funded through
trunk funds. There was discussion on the study and the expansion of water service. The Water
Department Capital Project Time Schedule was also presented. Mr. Adams pointed out the
green highlighted line item for Water Main Construction, and explained that the purpose of
those funds is to prepare for the moving and improvement of water mains resulting from city,
Highway 10, and Highway 169 road projects. There was discussion.
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For the Administrative and Technical Services Capital Budgets, notable items are the
installation of bullet-proof glass in the front counter area for Administration; and for Technical
Services the retrofit of a Landfill Gas (LFG) engine, replacement of truck#14, and pilot testing
for AMI technology. Mr.Adams provided some background on the LFG engines. There was
discussion on whether we continue putting money into replacing the engines as the contract
will be ending in 2022.
5.3 Auburn Tower Reconditioning Bids
The Auburn Water Tower Reconditioning Project was noticed for formal bids. The bid opening
was on September 10, 2018 at 1:00 p.m.; five bids were received. The bid tabulation and letter
of recommendation was distributed at the meeting. Mr. Volk went over the bid tabulation. He
stated that the Engineer's cost estimate for this project was $628,300.00, so it was nice to see it
come in under that amount. Staff and Badger State Inspection recommended awarding the bid
to the lowest bidder, Classic Protective Coatings, Inc., for the bid amount of$497,350.00.
Chair Dietz had a question about the engineering fees. Mr. Volk responded.
Moved by Commissioner Bell and seconded by Commissioner Nadeau to award the
contract for reconditioning and painting of the Auburn Water Tower to Classic
Protective Coatings,Inc. for the bid amount of$497,350.00. Motion carried 5-0.
6.0 BUSINESS DISCUSSION
6.1 Staff Updates
Mr.Adams touched on the communication plan to our customers for the transition to Minnesota
Municipal Power Agency(MIVIPA).He shared that the plan is to roll it out with our next newsletter,
with a focus on the benefits of being a member and buying power through MMPA. Staff plans to
also tie it in with the 2019 electric rates.
Mr.Adams asked if Commissioner Westgaard would provide an update to the City Council about
the resolution that was just passed by the Commission recognizing Public Power Week,October 7-
13,2018. Commissioner Westgaard responded that he would.
In her staff report,Ms. Slominski reported that we would be refunding customers for some deposit
interest that they were owed in 2016 and 2017. She shared that there will be a special message on
the bill only for those customers that actually receive a refund.The message will say"Deposit
interest from 2016 and 2017 is refunded on this bill."Chair Dietz asked when these refunds would
be taking place. Staff responded that they would begin showing up on the bills in the September
billing cycles. Commissioner Stewart inquired what the approximate dollar amount of the refunds
was.Ms. Slominski stated it was about$4,000.
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Mr.Fuchs provided an update on the Area 5&6 territory transfer that will begin taking place on
September 13.He shared that there are 29 customers that will be transferred on the 13th,and the
remaining majority of customers transferred over on September 18.Mr.Adams provided further
explanation for the multiple day transfer. Chair Dietz had a question on the power supply issue at
the downtown Rivers Edge Park. Staff responded.
Mr. Tietz shared that the meter department is also preparing for the territory transfer which will
involve changing out 383+meters.He noted that there will be some changes with the final meter
reading with this transfer as Connexus will be utilizing advanced metering infrastructure(AMI.)
Mr.Tietz also shared that the interviews for the System Engineer went well,and that an offer has
been extended to one of the candidates.
Mr.Volk provided an update on the water main break that occurred on Thursday September 6.He
shared that there is some additional valve repair work that will need to be done sometime this week.
Mr. Sagstetter highlighted from his staff report that the response from customers transitioning to the
new Clean Energy Choice program has been very positive.Mr. Sagstetter also shared that ERMU
has partnered with the city to sponsor an event for National Drive Electric Week. On September 13,
the Chevy Bolt and Mitsubishi Outlander will be on display at the Elk River Farmers Market from 3
to 7 p.m. Staff and a few EV owners will also be on hand to provide information and answer
questions about electric vehicles.
6.2 Future Planning
Chair Dietz announced the following:
a. Regular Commission Meeting—October 9, 2018.
Mr. Adams announced that the Wage &Benefits Committee (W&BC)has set the date for the
next W&BC meeting, which will be open to all employees, for October 9, 2018 at 3:00 p.m.
6.3 Other Business
There was no other business.
7.0 ADJOURN REGULAR MEETING
Moved by Commissioner Westgaard and seconded by Commissioner Stewart to adjourn the
regular meeting of the Elk River Municipal Utilities Commission at 4:20 p.m.
Minutes prepared by Michelle Canterbury.
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John J.Dietz,ERMU Commission Chair
Tina Allard,City Clerk
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