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3.0 ERMU MINUTES 04-12-2005ELK RIVER MUNICIPAL UTILITIES REGULAR MEETING OF THE UTILITIES COMMISSION March 8, 2005 Members Present: Jerry Takle, President; James Tralle, Vice Chair; John Dietz, Trustee Staff Present: Bryan Adams, General Manager; Glenn Sundeen, Line Superintendent; Patricia Hemza, Office Manager; Theresa Slominski, Office Manager 1. Call meeting to order March 8, 2005 President Jerry Takle called the March 8, 2005, meeting to order. 2. Consider Utilities Agenda John Dietz moved to approve the March 8, 2005, Utilities Agenda with the addition of one item for discussion under Other Business. James Tralle seconded the motion. Motion carried 3-0. 2a. Election of Officers for 2005 James Tralle moved to re -appoint Jerry Takle, President; John Dietz, Vice Chair; and James Tralle, Trustee. John Dietz seconded the motion. Motion carried 3-0. 3. Consider Consent Agenda James Tralle moved to approve the Consent Agenda as follows: February Check Register February 8, 2005, Minutes Financials John Dietz seconded the motion. Motion carried 3-0. 5.1 Staff Up -dates Bryan Adams discussed the 5°i Street water main project, and the issues regarding low water pressure. Customers are alleging their service lines may be plugged with iron/magnesium over the years due to being on a dead end line. Discussion ensued as to who's responsibility is it to clean these service lines, the utility or the customer. Routing out these service lines was also considered with no final determination. Well #2 was pump tested recently and it can pump 1500 gpm. MN Department of Health has asked if the well casing was grouted, if not, we may have to put in a liner and grout. Bryan Adams also reminded the Commission that this would be Patricia Hemza's last commission meeting for she will be retiring April 8, 2005. At this time Jerry Takle presented her with a gift. Glenn Sundeen reported on the tree trimming, current projects, and one outage recently caused by a car hitting a pole. Patricia Hemza reported on the audit being finished and financials for January and February will be presented at the next meeting. Theresa Slominski responded that the audit went well and that she would be visiting with staff on a one to one basis to better understand their job duties. Possible job duty changes might be recommended. Page 2 Regular meeting of the Elk River Municipal Utilities Cormrussion March 8, 2005 5.2 Review and Consider 4`h Engine(& Elk River Landfill There is room and enough gas for a 4" engine at the Elk River LFG Facility. Elk River Landfill, Sherburne County, and Great River Energy have been sent a letter with construction cost, schedule, suggested contract changes, and a memorandum of intent. Sherburne County Board approved the memorandum of intent as well as GRE and Elk River Landfill. The first step is to start the air permit process and once we have a indication of reasonable air pennit requirements, we can proceed with the engine/generator purchase. Staff recommends we adopt a resolution referring to resolution 453 which allows us to proceed with the project and not utilize public bidding requirements. Motion by James Tralle for authorization to execute Memorandum of Intent. John Dietz seconded the motion. Motion carried 3-0. Motion by James Tralle to adopt attached resolution referring to chapter 453. John Dietz seconded the motion. Motion carried 3-0. Motion by James Tralle to start securing the necessary air permits. John Dietz seconded the motion. Motion carried 3-0. 5.3 Review MMUA/APPA Position Papers Jerry Takle shared his comments regarding the APPA legislative rally he recently attended with Bryan Adams. Further discussion followed on fire position papers presented to the congressional legislators. No action needed. 5.4 Review Draft Benefit Survey Bryan Adams presented a sample of the benefit survey and the proposed point system to evaluate the surveys. Bryan Adams feels the Medical and Dental Insurance will be an important issue. John Dietz questioned the increased insurance cost from last year, staff responded it was just over 15%. John Dietz recommends a committee of employees revisit the Insurance issue in the fall when we know what next years rates will be. It can then be brought to the Connnission and discussed further at that time. No further action taken. 6.1 Review Site Plan for Plant Area The Elk River Municipal Utilities will continue to grow physically due to acquiring more territory along with growth of existing areas. Because the land at the power plant is getting congested, do we want to consider purchasing the adjacent land to the north? James Tralle feels the future land purchase possibility should be further looked into. John Dietz will contact the family of the property to the north east and see if there is interest in selling this property. We must also resolve the fence encroachment issue with this property owner. 6.2 Review MMUA Safety Evaluations The MMUA Safety evaluation for 2004 from Dave Berggren was reviewed. This evaluation is very positive towards the utilities. Discussion followed on the benefits of this program. No action taken. Page 3 Regular meeting of the Elk River Municipal Utilities Commission March 8, 2005 6.3 Review and Consider Security Dispatch Services The security monitoring company we have been using has been sold to another company which is out of state. The new monitoring company is making changes with account munbers and staff is having difficulty resolving billing and customer issues. Staff is asking for authorization to switch monitoring companies to WH International. They are located in Rockford, Minnesota. Staff feels this would be a good move. John Dietz questioned how long the transition would take. Staff responded 2 - 3 months. Motion by James Tralle to switch monitoring companies from Criticom to WH Intemational. John Dietz seconded the motion. Motion carried 3-0. 6.4 Consider Engineering for New 69kv Transformer The 2006 budget projection includes a $600,000 item to purchase a new 69kv transformer and move an existing 69kv transformer from West Bank 1 to Substation North. The 2005 budget contains a $15,000 item to complete the necessary engineering. Staff is requesting permission to proceed with the engineering proposal from USG (United Services Group). Motion by John Dietz to proceed with the engineering proposal fi-om USG. James Tralle seconded the motion. Motion carried 3-0. Other Business John Dietz asked staff in the future, when the utilities is purchasing new equipment, to question the City if they desire to purchase the old equipment instead of trading it in. Staff responded that would be done in the future. The next regularly scheduled meeting of the Elk River Municipal Utilities Commission will be April 12, 2005, at 3:30. President Jerry Takle adjourned the regular meeting of the Elk River Municipal Utilities Commission at 5:20 p.m. espectfull ubt ed, Judy Mc padde Recording Clerk RESOLUTION A RESOLUTION 01 -THE CITY OF ELK RIVER RESOLUTION APPROVING TIDE EXERCISE OF POWERS UNDER MINNESOTA STATUTES, CHAPTER 453, RESPECTING A CERTAIN ELECTRIC POWER GENERATION PROJECT Be It Resolved as Follw%s: Recitals. (a) The City of Elk River, Minnesota, in cooperation and conjunction with the Elk River Municipal Utilities Commission (collectively, the "City') proposes to enter into contract(s) s+oh Sherburne County, Minnesota (the "County") and Waste Management, Inc , its successor, assigns and!or other persons (collectively "WTI") to facilitate the addition of a certain electric power generation project (the "Project'). (b) hhe Project v,ould consist of the addition and completion of an 800 kilowatt hour landfill gas -to -energy electric generator located in the City at the Elk Riser Landfill. The cost of the Project is currently estimated to be 5670,000.00. (c) The Project will be a base load generator owned by the City_ (d) It is proposed that WM, in conjunction lith the City, would plan, complete and operate the Project. The Project is expected to be operational on a full-ume basis to provide electric energy to the customers of the City. The City expects to benefit from the Project by enhancing its capacity against the growing electricity needs of the City and against uncertainty of national electric capacity as a whole - (c) It is proposed that the County loan the sum of approximately S6707000 00 from its Solid Waste Surcharge fund to the City for the purchase of the generators and related equipment, kith zero interest over a sixteen year repayment period. (f) The City, the County and W'M v,ould enter into agreements (collectively, the "Agreements") specifying the respective rights and obligation of the City, the County and %kM- (g) The Cit}would issue a note(s) to finance the Project_ These Notes would be payable from revenues derived from the operation of the Project and would be secured I))' a mortgage or other suitable security interest in [lie Projcct The Notc(s) would not be a general or moral obligation of the City, would not be secured by any, of the City's existing municipal electric utility assets, and would not be payable from or alien against the rates and charges imposed by the City on its municipal electric customers- 2 Authorization- It is hcicbv resolved and defermined pursuant to hLnncsota Statutes, Section 45358, that the Coy may exercise such pokers and enjoy such privileges provided in Mnncsota Statutes, Chapter 453, as may be desirable of neccssary in connection kith the City's participation in the Project, as generally described hereinabove, the entering into the Agreements, and the issuance of the Notc(s) in aid of financing and completing the Project 3. Al2proval and Publication- This Resolution has been duly adopted by the City Council of the City of Elk River. Minnesota, and by the Elk River Municipal Utilities Commission, respectively, at duly called and regularly held meetings there on _ , 20 _ and shall be published once in the official newspaper o1 ie City as soon as conveniently possible pursuant toMinnesota Statutes, Section 453 58, Subdivision 2. This Resolution in itself if not intended and shall not be interpreted as a commitment of the City to the Project, xa$ich shall be contingent upon the execution of the mutually acceptable Agreements. Passed and adopted by the City Council and the Elk River Municipal Utilities Commission of the City of Elk River this day of March. 2005. ATTEST: 131ran Adana ATITST. loan scrimicH 2 FLK RIVER MUNICIPAL UI-ILITIES COMMISSION 13,. James Tralle Its President ELK RIVER CITY COUNCIL By: Stephanie Kloving, Mayoi