3.1.C. ERMU MINUTES 04-12-2011ELK RIVER MUNICIPAL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
HELD AT UTILITIES CONFERENCE ROOM
March 8, 2011
Members Present: John Dietz, President; Daryl Thompson, Vice Chair; Al Nadeau, Trustee
ERMU Staff Present: Troy Adams, Director of Operations;
Theresa Slominski, Finance Director/Office Manager;
Mark Fuchs, Line Superintendent; David Berg, Water Superintendent;
Wade Lovelette, Technical Services Superintendent;
Judy McSpadden, Recording Clerk
City Staff Present: Lori Johnson, City Administrator
Others Present: Peter Beck, Attorney from Gray Plant Mooty Law Firm
1.1 Call meeting to order March S. 2011
John Dietz called the March 8, 2011 meeting to order at 3:30 p.m.
2.1 Consider Utilities Agenda
John Dietz added an item to discuss under other business.
Daryl Thompson moved to approve the March 8, 2011 Utilities Agenda. John Dietz seconded
the motion. Motion carried 2-0.
2.la Election of 2011 Utilities Commission Officers
Al Nadeau was sworn in as an ERMU Commissioner by John Dietz.
Daryl Thompson moved to have John Dietz remain as President, Daryl Thompson as Vice
Chair, and Al Nadeau as Trustee. Al Nadeau seconded the motion. Motion carried 3-0.
3.1 Consider Consent Agenda
John Dietz had questions on the check register and financials, staff responded.
Daryl Thompson moved to approve the Consent Agenda as follows:
a. February Check Register
b. February 15, 2011 Minutes
c. Financial Reports
d. Signature Card Resolution
AI Nadeau seconded the motion. Motion carried 3-0.
Page 2
Regular meeting of the Elk River Municipal Utilities Commission
March 8, 2011
4.1 Power Supply Options / Resource Planning Update
In September 2008, Connexus Energy terminated the 10-year rolling "all requirements" power
contract with ERMU. In April 2010, the Utilities Commission authorized entering into "Phase 1" of a
resource planning study with a coalition which includes Central Minnesota Municipal Power Agency
(CMMPA) as a participant. In September 2010, the Utilities Commission authorized entering into
"Phase 2" of a resource planning study which includes the release of a Request For Proposal (RFP).
The RFP was issued on November 15, 2010.
Bids have been received and are being assessed by CMMPA. There has also been discussion
with Connexus Energy throughout this process. They are interested in reworking the current contract.
Troy Adams asked for authorization to have RW Beck do an analysis of the bids compared with any
Connexus proposal.
Daryl Thompson moved to have R.W. Beck analyze the bids at a cost not to exceed $2,000. AI
Nadeau seconded the motion. Motion carried 3-0.
4.2 Update on the Midwest Municipal Transmission Group and the CAPX2020
BrookinepTwin Cities Transmission Proiect
In May 2006, the Utilities Commission authorized joining Midwest Municipal Transmission
Group (MMTG) to explore the potential to obtain ownership in the transmission system. In February
2007, ERMU entered into an agreement to participate through Central Minnesota Municipal Power
Agency (CMMPA) in the CAPX2020 Brookings -Twin Cities Transmission project. Through
MMTG, ERMU is currently receiving approximately $4,500 revenue as return investment in existing
ERMU substation equipment. A representative from CMMPA made a presentation to the Utilities
Commission and City Council on March 7s'to go over the project. The decision is on whether or not
ERMU should invest further into this transmission project. John Dietz asked Lori Johnson and Troy
Adams their opinions. Consensus was that there were still some questions to be answered but that
overall this could be a good investment. This issue was tabled until the joint meeting scheduled for
March 14, 2011.
Daryl Thompson moved to call a special joint meeting with City Council on March 14, 2011 at
6:30 p.m. Al Nadeau seconded the motion. Motion carried 3-0.
5.1 Review Minnesota Open Meeting Law and Minnesota Government Data Practices Act
Peter Beck reviewed the Minnesota Open Meeting Law and the Minnesota Government Data
Practices Act. Discussion followed. No action taken.
Page 3
Regular meeting of the Elk River Municipal Utilities Commission
March 8, 2011
5.2 Review and Consider Bore Rie Purchase
The 2011 budget contained a $200,000 line item for the purchase of a directional bore rig,
trailer, modular mixing system, and additional related equipment. This type of equipment is not
available through the Minnesota State Bids. However, National Joint Power Alliance (NJPA) is a
government service cooperative that has been created through MN Stature 123A.21 and they have the
government contract for this type of construction equipment. This agency provides a similar service
as the Minnesota State Bids by MN Statute 471.59 and 471.345. Vermeer has the contract with NJPA
for this type of equipment. The quote on a Vermeer directional bore rig, modular mixing system, and
locator total $166,783.78. Bids on a trailer will be reviewed at a future meeting. Discussion followed.
Daryl Thompson moved to purchase the Directional Bore Rig from Vermeer for $166,783.78.
AI Nadeau seconded the motion. Motion carried 3-0.
5.3 Review and Consider Cable Plow Purchase
Approved in the 2011 budget was the purchase of a cable plow. Under the same circumstances
as the directional bore rig, this equipment is not available through Minnesota State Bids but is
available through NJPA. The budgeted amount was for $150,000 and the quote received for a
Vermeer cable plow after trade in of the Case 960 cable plow is $131,921.16.
Al Nadeau moved to award the purchase of the Vermeer Cable Plow with trade-in of the Case
960 cable plow for $131,921.16. Daryl Thompson seconded the motion. Motion carried 3-0.
5.4 American Public Power Association 2011 Legislative Rally Update (Verbal)
Troy Adams and Wade Lovelette updated the Commissioners on the Legislative Rally they
recently attended in Washington, D.C.
5.5 Review and Consider Purchase Policies
On January 14, 2003, the Elk River Municipal Utilities Commission approved a resolution to
grant the purchase and payment of equipment, materials, and services necessary to ensure efficient
operations. In 2009, the ERMU commission directed staff to temporarily establish the purchasing
authority threshold to $10,000 on all budgeted and non -budgeted purchases. This was to be
reevaluated at a future date.
Often, the timely purchase of budgeted materials or equipment will exceed $10,000. Examples
include transformers, meters, cable, and switchgear. At times these purchases may be time sensitive
and it may not be efficient operations to wait for the next regularly scheduled Elk River Municipal
Utilities Commission meeting to get approval for the purchase. These payments are documented in
the check register and approved in the consent agenda by the Elk River Municipal Utilities
Page 4
Regular meeting of the Elk River Municipal Utilities Commission
March 8, 2011
Commissioners. Staff is asking for reestablishment of the 2003 Elk River Municipal Utilities
Resolution to grant purchase and payment of equipment, materials, and services necessary to ensure
efficient operations.
Daryl Thompson moved to reestablish the 2003 Elk River Utilities Commission Resolution to
grant purchase and payment of equipment, materials, and services necessary to ensure efficient
operations. Al Nadeau seconded the motion. Motion carried 3-0.
6.1 Staff Updates
Troy Adams reminded the commissioners of the upcoming MMUA Legislative Conference in
St. Paul March 30s' through April 1 s .
Theresa Slominski Updated the Commissioners on the credit card payment system. John Dietz
asked if this would reduce the NSF payments for ERMU. Staff affirmed.
David Berg discussed the recent visit to the Minnesota State Capitol for soil and water
conservation. Discussion followed. David Berg handed out information and pictures of the Elk River
Zylstra HOG Motorcycle Club shoveling out all the buried fire hydrants in Elk River. This was
greatly appreciated. ERMU received a $9,000 grant from Minnesota Department of Health for Well
head protection and water conservation. David Berg said he would like to allocate $5,000 of the grant
to help seal unused wells. Discussion followed regarding how much ERMU would contribute to seal
the wells. Consensus of the Commission was to pay 50% of the cost with the funds crediting their
water bill. Peter Beck suggested utilizing a contractor to do this service to ensure it was done right.
John Dietz directed David Berg to compile more information and bring back to the next commission
meeting for further discussion.
Lori Johnson brought up the painting of the water tower. The plans are for the new logo to be
painted on the water tower and with the colors of the new logo it was recommended for the tower to
be painted white instead of tan. Consensus was to go ahead with painting the tower white with the
new logo.
John Dietz commented on a question asked of him at the recent monthly mayoral luncheon.
Several well drillers were present. A question was asked regarding the residential properties that have
their own well, if they are bound by the sprinkling ban. Troy Adams responded this was briefly
discussed at a previous meeting and tabled until the April meeting.
6.2 Set Date for Next Meetine
The next regularly scheduled meeting of the Elk River Municipal Utilities Commission will be
Tuesday, April 12, 2011 at 3:30 p.m.
Page 5
Regular meeting of the Elk River Municipal Utilities Commission
March 8, 2011
6.3 Adiourn Reeular Meetin¢
Daryl Thompson moved to adjourn the regular meeting of the Elk River Municipal
Utilities Commission meeting at 5:50 p.m. Al Nadeau seconded the motion. Motion carried 3-0.
Minutes prepared by Judy McSpadden.
John J. Dietz
President, ERMU Commission
Tina Allard
City Clerk