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ERMUSR 04-09-2019 •�i Elk River Municipal Utilities COMMISSION POLICY Governance ERMUMN.COM 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER, MN 55330-0430 2 _,. ..4‘, ./„ >14) Elk River Municipal Utilities 2019 GOVERNANCE AGENDA Tuesday, January 8: Tuesday,February 12: • Annual Review of Committee Charters • Review Strategic Plan and 2018 Annual Business Plan results Tuesday, March 12: Tuesday,April 9: • Oath of Office • Annual Commissioner Orientation and Review • Election of Officers Governance Responsibilities and Role • Audit of 2018 Financial Report • Financial Reserves Allocations • Review 2018 Performance Metrics Tuesday,May 14: Tuesday, June 11: • Annual General Manager Performance • Evaluation and Goal Setting Tuesday, July 12: Tuesday,August 13: • Annual Commission Performance Evaluation • Annual Business Plan—Review Proposed 2020 • Review and Update Strategic Plan Travel, Training, Dues, Subscriptions, and Fees Budget Tuesday, September 10: Tuesday, October 8: • Annual Business Plan—Review Proposed 2020 • Annual Business Plan—Review Proposed 2020 Capital Projects Budget Expenses Budget Tuesday,November 12: Tuesday, December 10: • Annual Business Plan- Review Proposed 2020 • Adopt 2020 Official Depository,Newspaper, Rates and Other Revenue and Regular Meeting Schedule • Adopt 2020 Fee Schedule • Adopt 2020 Governance Agenda • 2020 Stakeholder Communication Plan • Adopt 2020 Annual Business Plan 3 Elk River ----- Municipal Utilities COMMISSION POLICY MANUAL TABLE OF CONTENTS GOVERNANCE Authority and Purpose Policies G.1a Bylaws G.1b Organizational Core Purpose G.1c Mission Statement G.1d Vision Statement G.1 e Organizational Values G.i f Organizational Fundamentals G.1 g Planning Themes Governance Policies G.2 Commission Purpose G.2a Commission—City Council Relationship and Roles G.2b Governing Style G.2c Agenda Planning G.2d Commission Member Role, Responsibilities and Orientation G.2e Commission Member Conduct G.2f Commission Officer Roles, Responsibilities and Succession G.2g Commission Committees G.2g1 Wage & Benefits Committee Charter G.2g2 Financial Reserves and Investment Committee Charter G.2h Independent Advisors to the Commission Commission—Management Connection Policies G.3 Commission- Management Roles G.3a Controlling Authority G.3b Delegation of Authority to the General Manager G.3c General Manager Accountability G.3d Monitoring Performance of the General Manager G.3e General Manager Performance Planning and Evaluation Delegation to Management Policies G.4 Corporate Limitations G.4a Succession of Leadership G.4b Information and Support to the Commission G.4c Strategic and Business Planning Page 1 of 2 4 ERMU Commission Policy Manual Table of Contents G.4d Customer Interests G.4e Core Customer Services G.4f Employee Interests G.4g Organization, Staffing, and Compensation G.4h Financial Planning and Budgeting G.4i Financial Condition and Transactions G.4i 1 Investments G.4i2 Financial Reserves G.4i3 Debt Issuance and Payment G.4i4 Procurement G.4j Cost Allocation and Recovery G.4j 1 Rates and Charges for Electric Services G.4j2 Rates and Charges for Water Services G.4k MMPA Relationship, Representative and Governance G.41 Protection of Assets G.4m Corporate Risk Management G.4n Legal&Regulatory Compliance G.4o Environmental Stewardship G.4p External Communications G.4q Community Involvement Results Policies G.5 Goals and Results Page 2 of 2 5 Elk River Municipal Utilities COMMISSION POLICY MANUAL TABLE OF CONTENTS GOVERNANCE Authority and Purpose Policies G.1 a Bylaws G.lb Organizational Core Purpose G.1 c Mission Statement G.ld Vision Statement G.le Organizational Values G.lf Organizational Fundamentals G.1 g Planning Themes Governance Policies G.2 Commission Purpose G.2a Commission—City Council Relationship and Roles G.2b Governing Style G.2c Agenda Planning G.2d Commission Member Role, Responsibilities and Orientation G.2e Commission Member Conduct G.2f Commission Officer Roles, Responsibilities and Succession G.2g Commission Committees G.2g1 Wage &Benefits Committee Charter G.2g2 Financial Reserves and Investment Committee Charter G.2h Independent Advisors to the Commission Commission—Management Connection Policies G.3 Commission - Management Roles G.3a Controlling Authority G.3b Delegation of Authority to the General Manager G.3c General Manager Accountability G.3d Monitoring Performance of the General Manager G.3e General Manager Performance Planning and Evaluation Delegation to Management Policies G.4 Corporate Limitations G.4a Succession of Leadership G.4b Information and Support to the Commission G.4c Strategic and Business Planning Page 1 of 2 6 ERMU Commission Policy Manual Table of Contents G.4d Customer Interests G.4e Core Customer Services G.4f Employee Interests G.4g Organization, Staffing, and Compensation G.4h Financial Planning and Budgeting G.4i Financial Condition and Transactions G.4i 1 Investments G.4i2 Financial Reserves G.4i3 Debt Issuance and Payment G.4i4 Procurement G.4j Cost Allocation and Recovery G.4j 1 Rates and Charges for Electric Services G.4j2 Rates and Charges for Water Services G.4k MMPA Relationship, Representative and Governance G.41 Protection of Assets G.4m Corporate Risk Management G.4n Legal& Regulatory Compliance G.4o Environmental Stewardship G.4p External Communications G.4q Community Involvement Results Policies G.5 Goals and Results Page 2 of 2 7 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authorities and Purpose Policies Policy Reference: Policy Title: G.la Bylaws ARTICLE I—AUTHORITY Section 1. The Village of Elk River Water, Light, Power and Building Commission was created on July 11, 1947, by resolution adopted by the Village of Elk River Trustees. Section 2. Pursuant to Minnesota Statutes, Section 412.331, adopted in 1949, any water, light, power and building commission then in existence was required to thereafter operate as a public utilities commission under Minnesota Statutes, Sections 412.321 to 412.391. The Village of Elk River Water, Light, Power and Building Commission became Elk River Municipal Utilities. Section 3. Elk River Municipal Utilities is a public utilities commission operating pursuant to and subject to Minnesota Statutes, Sections 412.321 to 412.391 and Elk River City Code Sections 2-271 to 2-276. ARTICLE II—JURISDICTION Section 1. Elk River Municipal Utilities has jurisdiction over: A. The City of Elk River Municipal electric utility; and B. The City of Elk River water utility. ARTICLE III—COMMISSION MEMBERSHIP Section 1. Pursuant to Laws of Minnesota 2016, Chapter 97 — House File No. 2718, and Elk River City Code Section 2-271, the Elk River Municipal Utilities Commission shall consist of five members. No more than two members may also serve as City Council members. Section 2. Commissioners shall be appointed by the City Council to staggered terms. Page 1 of 4 8 ERMU Commission Policy—G.1 a Bylaws Section 3. Each Commissioner shall serve for a term of three years and until a successor is appointed and qualified. Section 4. Commissioners shall comply with the City's conflict of interest ordinance, Elk River City Code Sections 2-131 to 2-135. Section 5. No member of the Commission shall receive a salary except as fixed by the City Council. ARTICLE IV— OFFICERS Section 1. The Commission shall annually choose a president from among its members. The president shall be designated the Chair of the Commission and shall perform such duties as shall be delegated to the Chair in the Commission's adopted policies Section 2. The Commission may also annually appoint a Vice-Chair of the Commission who shall perform such duties as shall be delegated to the Vice-Chair in the Commission's adopted policies. The Vice-Chair shall preside at meetings of the Commission if the Chair is absent. Section 3. The Commission shall also appoint a Secretary for an indefinite term. The Secretary need not be a member of the Commission and shall perform such duties as shall be delegated to the Secretary in the Commission's adopted policies. Section 4. The Commission shall have the power to revoke a Commission member's appointment as Chair or Vice-Chair, and appoint a replacement Chair or Vice Chair, if the Commission determines, by a vote of a majority of its members, to do so. The Commission shall also have the power to replace the Secretary at any time by a vote of the majority of its members. ARTICLE V—MEETINGS Section 1. The Commission shall hold at least one regular meeting each month, on the day and at the time designated by the Commission from time to time. Regular meetings shall be noticed as required by Minnesota Statutes. Section 2. The Commission may hold special meetings from time to time at the request of the Chair or the request of two other Commissioners. Special meetings shall be noticed as required by Minnesota Statutes. Section 3. A majority of the Commissioners shall constitute a quorum for the transaction of business, and the votes of a majority of the Commissioners present shall be sufficient to adopt any motion or resolution. The votes of members on any action shall be taken by ayes and nays recorded in the minutes. Section 4. Commission meetings are open to the public unless closed as authorized by Minnesota Statutes, and shall be governed by Roberts Rules of Order, latest revised edition, for Page 2 of 4 9 ERMU Commission Policy—G.la Bylaws all situations to which they apply and in which they are not inconsistent with these Bylaws, the Commission's adopted Policies, and any special rules of order that the Commission may adopt.. ARTICLE VI—POWERS Section 1. The Commission shall have all of the powers enumerated in Minnesota Statutes, Section 412.361 and, except as provided in the Bylaws and the Commission's adopted Policies, shall exercise those powers on its own behalf. ARTICLE VII— GENERAL MANAGER Section 1. The Commission shall have the power to appoint a General Manager, whose responsibilities, duties, limits of authority and accountability to the Commission shall be set forth in these Bylaws and as designated by the Commission from time to time in its adopted Policies. Section 2. The General Manager shall have the authority to implement the Commission's powers under Minnesota Statutes, Section 412.361, Subds. 1 and 2 to enter into contracts for the operation of the utility and to employ all necessary help for the management and operation of the public utility, by entering into contracts and employing personnel consistent with the Commission's adopted budget and pay plan. However, all contracts requiring public bidding, all contracts falling under Minnesota Statutes, Section 412.361, Subds. 3, 4 and 5, and all contracts required by the Commission's adopted Policies to be approved by the Commission, shall be approved by the Commission. Section 3. If the position of the General Manager is vacant, the Commission may designate another to perform all or some of the General Manager's duties. ARTICLE VIII—FINANCES, FUNDS AND REPORTS Section 1. The Commission shall maintain the funds, conduct the audits and make the reports required by Minnesota Statutes, Sections 412.371 and 412.381. ARTICLE IX—APPLICATION AND AMENDMENT Section 1. In the event that any provision of these Bylaws is or may be in conflict with the laws of any governmental body or power having jurisdiction over the Elk River Municipal Utilities Commission, or over the subject matter to which such provision of these Bylaws applies or may apply, such provision of these Bylaws shall be inoperative to the extent only that the operation thereof unavoidably conflicts with such law and shall in all other respects be in full force and effect. Section 2. These Bylaws may be amended by the Commission at any regular meeting by a majority vote of the entire Commission, provided the proposed amendment is on the agenda and made public no later than three days before the meeting. Section 3. In addition to these Bylaws, the Commission may adopt, from time to time, Governance Policies (adopted Policies)that are not inconsistent with these Bylaws. Page 3 of 4 10 ERMU Commission Policy—G.l a Bylaws BYLAW HISTORY: Adopted June 13, 2017 Page 4 of 4 11 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.lb Organizational Core Purpose PURPOSE: The purpose for organizational initiatives and goals is to produce desirable results. In order for any organization to be effective and maintain sustainable success,the organization must define its organizational core purpose. This core purpose then becomes the basis for establishing the criteria from which results and organization success are measured. Just as the economy, industry, and community evolve and change, the organizational core purpose must also evolve and change. The organization must establish and maintain a review process of their organizational core purpose for sustainable success. With this policy,the Commission commits that it will govern as a body in a manner consistent with its adopted mission statement,vision statement, organizational values, and organizational fundamentals. The Commission will also commit to govern as a body through policy development and initiative prioritization which are in alignment with adopted planning themes. The Commission acknowledges the importance for the development and support of the mission statement,vision statement, organizational values, organizational fundamentals, and planning themes to achieve the following: an environment of transparency; a clear line of sight from tasks through goals; and a work environment for meaningful work providing value to the community. The Commission also commits to engage in an ongoing review process of the organizations core purpose,to maintain organizational effectiveness and sustainable success. POLICY: The Commission will adopt and maintain relevant and sustainable organization core purpose documents including a mission statement, a vision statement, organizational values, organizational fundamentals, and planning themes. The Commission will govern ERMU in a manner consistent with these adopted documents outlining the organization's core purpose. The Commission will review and update these documents as necessary at a minimum of once every five years through engaging with management and staff in a strategic planning process. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 12 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.1c Mission Statement PURPOSE: One of the key components in establishing an organizational core purpose is the development and ongoing support of a relevant mission statement. Through the development, adoption, and ongoing support of an organizational mission statement,the Commission establishes a guiding statement to communicate both internally and externally the day to day purpose for the organization's existence. The mission statement then plays an important role in the development of policies and programs and serves as a guide for effective governance and operations. POLICY: The Commission adopts and commits to govern in a manner consistent with the following mission statement: Provide our customers with safe, reliable, cost effective and quality long term electric and water utility service. To communicate and educate our customers in use of utility services,programs,policies, and future plans. These products and services will be provided in an environmentally and financially responsible manner. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 13 Elk River ,. Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.ld Vision Statement PURPOSE: A vision statement is a key component in establishing an organizational core purpose. Through the development, adoption, and ongoing support of an organizational vision statement,the Commission establishes a guiding statement to communicate both internally and externally where the organization aspires to be. The vision statement then plays an important role in inspiring the employees to engage and help support the organization in achieving their goals. The vision statement also plays an important role in providing transparency in policy development and organization initiatives to the customers and the public. POLICY: The Commission adopts and commits to govern in a manner consistent with the following vision statement: Provide exceptional services and value to those we serve. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 14 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.le Organizational Values PURPOSE: Governance and leadership style set the tone for organizational culture. With this policy,the Commission acknowledges the importance for establishing expectations for organizational values to guide policy development and organizational behavior. POLICY: The Commission adopts, as an expectation of organization operational behavior, and commits to govern in a manner consistent with the following organizational values: Value 1: Integrity—Honest, accountable and united in all that we do. Value 2: Quality—Services that reflect excellence, dependability and expertise. Value 3: Communication—Respectful and engaged interactions that are timely and clear. Value 4: Safety—A culture that protects our customers, employees and assets. Value 5: Competitive—Provide the best value for the services we deliver. POLICY HISTORY: Adopted May 9, 2017 Revised June 12, 2018 Page 1 of 1 15 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.lf Organizational Fundamentals PURPOSE: The foundation to a building provides the structure stability to support the many components of the building, each of which service for different functions and combine to provide value and meaningful purpose. Similarly, organizational fundamentals serve as foundational concepts on which to build a company. These organizational fundamentals then align with and provide support and guidance for achieving the mission and vision of the organization. POLICY: The Commission adopts and commits to govern in a manner consistent with the following organizational fundamentals: Fundamental 1: Safety, Reliability, and Quality of Utility Services. Fundamental 2: Customer Service and Employee Development. Fundamental 3: Competitive Rates, and Financial and Organizational Health. POLICY HISTORY: Adopted May 9, 2017 Revised November 13, 2018 Page 1 of 1 16 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Authority and Purpose Policies Policy Reference: Policy Title: G.1g Planning Themes PURPOSE: Providing transparency and a clear connection between the organizational mission and vision to initiative and task, is an important leadership guide to make sure resources are contributed towards meaningful work. Line of sight between mission and task also helps to create a positive work environment where employees can identify the value of their efforts in achieving the organizational goals. Planning themes are used to prioritize initiatives, schedule and budget required resources, and create a clear line of sight between mission and task. With this policy the Commission acknowledges the importance of planning in a manner consistent with the organizational mission and vision such that the organizations resources are being used responsibly for meaningful work. POLICY: The Commission adopts and commits to govern in a manner consistent with the following planning themes: Theme 1: Communication—Improve the effectiveness of our communications inside the organization, with our customers, and with the community. Theme 2: Personnel and Governance—Develop our most valuable and vulnerable assets....our commissioners, employees, leaders, and future leaders. Theme 3: Strategic Thinking—Create a culture of strategic thinking and ensure line of sight from mission to vision. Theme 4: Technology—Implement the prudent use of technology to improve efficiency and increase customer choice, communication, and value. Theme 5: Growth—Assess the growth curve to make decisions regarding organizational change. Page 1 of 2 17 ERMU Commission Policy—G.1 g Planning Themes Theme 6: Process, Measurement, and Financial Health—Improve processes and measurement to better determine and report efficiency and effectiveness of organization and to ensure financial and organizational health. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 18 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2 Commission Purpose PURPOSE: With this policy,the Commission commits that it will govern as a body that understands its obligations to the owners and other stakeholders of the ERMU electric and water utility enterprises. POLICY: The Commission's principal purpose is to ensure that ERMU achieves appropriate results (See Results Policies) for its owners, customers, employees, and other stakeholders at an appropriate cost,while avoiding unacceptable actions and situations. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 19 4*-' Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2a Commission — City Council Relationship and Roles PURPOSE: With this policy, the Commission describes its role in relation to the Elk River City Council and the way in which it desires to interact with the City Council. POLICY: The Commission and the City Council share the responsibility for ensuring effective governance of ERMU for the benefit of the City, its citizens, and ERMU's utility customers. The Commission desires to maintain a working relationship with the City Council that will enable both bodies to coordinate and carry out their separate responsibilities so that ERMU is governed with excellence. Although governed autonomously by the Commission, ERMU is part of the City of Elk River's City government. This creates opportunities for bringing greater value to the stakeholders of both the City and ERMU through a hybrid of municipal utilities and city governance. It is the intent of the Commission to align its governance structures and processes with the city in ways that will realize opportunities for greater value. Consistent with the preceding, the Commission will: 1. Routinely monitor, evaluate, and strive to improve its performance, keeping the City Council informed in a thorough and timely manner about the effectiveness of the Commission's governance with respect to the following: a. Compliance with legal and fiduciary responsibilities; b. Compliance with Commission-established Governance policies that are periodically reviewed and updated, and that set expectations for ERMU's strategic and business results, governance, and management. Page 1 of 2 20 ERMU Commission Policy— G.2a Commission—City Council Relationship and Roles 2. Support ERMU's active participation in the City's Economic Development Authority(EDA), representing the interests of ERMU's stakeholders and working to develop common goals for economic development. 3. Provide an opportunity for the City Council to meet jointly with the Commission at least once every three (3)years. The meeting will be held following completion of the annual independent financial audit. The focus of this joint meeting will be a report by the Commission to the Council of ERMU's financial and operating results for the preceding fiscal year, along with an opportunity for the Council to provide input to the Commission on matters related to planning and budgeting for the next fiscal year. The Commission may request or recommend additional joint meetings for other specific purposes. 4. Develop, update as necessary, and provide to the Mayor and City Council documentation that is intended to ensure the appointment of qualified and committed ERMU Commissioners. Such documentation will include relevant knowledge and experience, core competencies, and character traits that are consistent with the Commission's requirements and commitments to effective governance. The Commission's expectation is that the City Council will use this information to appoint persons who are appropriately qualified and well-informed about the expectations for service as a Commissioner. 5. At least annually at the time of budgeting for the next fiscal year, consider ERMU's financial condition with respect to voluntary payments in lieu of taxes (PILOT) and other donations of services from the ERMU utility enterprises to the City that are likely to have material financial consequences for both entities. The Commission will inform the City Council promptly of any material changes in the PILOT and other donations. Further,the Commission will use a process for determining PILOT and other financial donations to the City that is transparent, consistent with state and national benchmarking comparisons, forecasted and budgeted, and with a mutually understood methodology. In approving or allowing other donations such as labor, street lighting, and water for fire suppression, the Commission will subscribe to the philosophy that it is providing value to the community and not just shifting costs from one entity to the other. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 21 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2b Governing Style PURPOSE: With this policy,the Commission intends to establish and articulate an institutional philosophy and approach that will enable it to govern with excellence. POLICY: Commission Members, individually and collectively, will act in ways that visibly demonstrate the ERMU style of governance. Commission members will lead proactively and the Commission will enforce upon itself the discipline needed to govern effectively and consistently. Consistent with the preceding general statements: 1. The Commission will guide and inspire Management and staff employees toward a strategic vision through the thoughtful and proactive development of written policies that express clear expectations and shared accountability for results. 2. The Commission's policies will reflect its statuary authority, effectively meeting its responsibilities while representing and balancing the sometimes competing interests of customers,the ERMU utility business enterprises,the City of Elk River, ERMU employees, and others who may be affected, either directly or indirectly, by ERMU's decisions and actions. 3. The Commission will govern ERMU as the significant business enterprise that it is, enabling ERMU to provide quality services to its customers and prudent financial contributions to the City, while responsibly managing and sustaining its physical assets and financial resources. 4. The Commission,with support from the General Manager, will set its own agenda for governance and,to the greatest extent practical, will initiate its own policies. The Commission will consider and adopt policies in accordance with its stated Principles for Page 1 of 2 22 ERMU Commission Policy—G.2b Governing Style Policy Development. The Commission will routinely review, evaluate and update its policies, as necessary. 5. By adopting and enacting its policies,the Commission will create and sustain a governance structure and processes in which the respective roles and accountabilities of the Commission and Management are clearly delineated,understood, and mutually supported. 6. The Commission will promote a sense of partnership,trust, and mutual respect among its individual members, with ERMU Management and staff employees, and with customers, City, and community interests to provide value to all stakeholders. 7. The Commission will establish and use a variety of methods to promote two-way communications and dialogue about ERMU's future direction, accomplishments, and major challenges among its stakeholders. 8. The Commission will support the development of a values-based organization with high standards of professional conduct, interpersonal behaviors, and self-accountability for results. 9. The Commission will encourage mutual respect, open dialogue and expression of diverse viewpoints among Commission members and Management; the Commission will acknowledge and effectively handle disagreements,working toward consensus in its deliberations and decisions. 10. The Commission will support the hiring and retention of a capable General Manager, who will be responsible to the Commission for the management and operation of ERMU's utility businesses. The Commission will also support the General Manager in creating an organization which attracts and retains capable management and staff employees, and develops leaders. 11. Commission members will devote appropriate attention,time and energy to govern effectively. They will understand their responsibilities and take advantage of opportunities for continuing education and development that improve their governance capabilities. 12. The Commission will seek to create a reputation that attracts qualified and dedicated persons to become Commission members. It will do this by building public understanding of its governance role, as well as the commitments and contributions of its individual members. 13. The Commission will periodically evaluate and discuss its policies and the performance of the ERMU organization in relation to those policies, with particular attention to the needs and expectations of its various stakeholders. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 23 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2c Agenda Planning PURPOSE: With this policy,the Commission establishes its expectations for a proactive governance process, expressed in terms of a forward-looking agenda of recurring governance functions. The Commission also establishes the process for determining the agenda for each regularly scheduled Commission meeting. POLICY: The Commission, with support from the General Manager, will prepare, distribute, and follow a governance agenda that spans the upcoming fiscal year. The Commission will update this agenda annually during the fourth quarter of each fiscal year. The Commission will review the agenda as a part of each regular Commission meeting. The Commission's governance agenda will include a schedule of its recurring governance functions by month to facilitate the preparation of meeting agendas and the conduct of regular and special Commission meetings. Recurring governance functions include but are not limited to the following: consideration of stakeholder interests, policy review and development, strategic planning, approval of financial and business plans including budgets, organizational performance monitoring, internal and external audit reviews, General Manager performance planning and evaluation, governance evaluation and development, Commission Officer election, and committee appointments. The Commission will keep its governance agenda up-to-date and available to all Commission members,the Commission's Legal Counsel, and the General Manager. The General Manager,with direction from the Commission,will also prepare and distribute, in a timely manner, a detailed agenda that provides for open communications and the orderly and efficient conduct of each regular Commission meeting, special Commission meeting and Commission work session. Agendas for regular Commission meetings will address items from the governance agenda, Commission actions required by law, and other appropriate business matters. Agendas for special Commission meetings and Commission work sessions will typically focus on a limited number of specific items that are best handled in those types of meetings. Consistent with the preceding: Page 1 of 4 24 ERMU Commission Policy—G.2c Agenda Planning 1. During the first quarter of each fiscal year(January - March): a. The Commission will elect officers at its March meeting, following the appointment of Commissioners by the City Council. b. The Commission and Management will review ERMU's current Strategic Plan along with the results of the Annual Business Plan for the preceding fiscal year. 2. During the second quarter of each fiscal year(April-June): a. The Commission will consider and approve the external audit report as specified in the Governance Agenda. b. The Commission will review the financial reserves balances and related policy. The Commission shall take action as appropriate per policy. c. The Commission and Management will evaluate the Performance Matrix for the preceding fiscal year. d. The Commission will formally evaluate the performance of the General Manager. 3. During the third quarter of each fiscal year(July-September): a. The Commission will formally evaluate its own performance. Following this evaluation, the Commission,with the support from the General Manager,will arrange for governance education for the next fiscal year, including education related to the determination of desired results. b. The Commission and Management will begin its annual update of the Strategic Plan and Financial Plan for the succeeding five-year period. 4. During the fourth quarter of each fiscal year(October-December): a. The Commission will review and approve Management's proposed five-year Capital Improvement Plan as well as its proposed Annual Business Plan with budget, rates, and fees for the next fiscal year. b. The Commission, in conjunction with Management, will determine the stakeholder communications plan and schedule for the next fiscal year. 5. The Commission will direct the General Manager to prepare and distribute the agenda for each regularly scheduled meeting as follows: a. The Commission Chair and the General Manager will discuss, at least monthly, approximately seven (7) days in advance of each regularly scheduled Commission Page 2 of 4 25 ERMU Commission Policy—G.2c Agenda Planning meeting to develop a tentative agenda, including any items to be discussed in closed session. b. The tentative agenda and meeting packet of supporting materials will be distributed to Commission members and others approximately three (3) days in advance of the Commission meeting. Presentations and supplemental information items may be provided at the Commission meeting, c. The General Manager will ensure the posting of a meeting notice, along with the tentative agenda, in compliance with applicable law. d. Any Commission member or the General Manager may request additions, deletions or other changes to the agenda at the beginning of a regular meeting when the Commission Chair requests approval of the tentative agenda. Items requiring research or other advance preparation should be suggested for future meeting agendas.No items may be added to the agenda of special meetings and work sessions. e. Agendas for regular Commission meetings will be prepared in a consistent format as shown in the most current version of the Commission's "Model Agenda". Agenda items will be categorized by their nature, specifically identifying in order items that are presented: i. Governance—Includes agenda items: call meeting to order, pledge of allegiance, consider agenda, resolutions, and similar actions of governance. ii. Consent—Includes items that are considered routine. There may be questions asked for clarification, but typically these items have no discussion. The items on consent are presented for Commission consideration all together and by one motion. A Commission member may request before the motion to approve the "Consent" items that any item(s) be moved from "Consent"to "Business Action." iii. Open Forum—This is an opportunity for public participation. Speakers will be required to state their name and address for public record. Items will be heard at the discretion of the Commission Chair. Items will be for discussion only; no action can be taken on the topic during that meeting. iv. Policy& Compliance—Policy review,policy development, and compliance monitoring. v. Business Action—Current business action requests and performance monitoring reports. vi. Business Discussion—This includes strategic planning, general updates, and informational reports. Topics may be tabled for future Business Action consideration. Will include an agenda item title "Future Planning" during which time any Commissioner or the General Manager may discuss and suggest items for placement on future meeting agendas. This agenda category will also include the item"Other Business"to provide additional flexibility for discussion of matters not specifically contemplated in advance or for agenda items that do not required Commission action and do not conform to any of the predetermined categories. Page 3 of 4 26 ERMU Commission Policy—G.2c Agenda Planning f. The Commission prefers to introduce important decision items on the agenda at least one meeting before the meeting at which a decision is required. This is a preference but not a requirement. g. The Commission will include monitoring of the General Manager on a meeting agenda if monitoring reports show policy violations, or if policy criteria are to be debated. POLICY HISTORY: Adopted May 9, 2017 Revised December 11, 2018 Page 4 of 4 27 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2d Commission Member Role, Responsibilities, and Orientation PURPOSE: With this policy,the Commission describes the role and responsibilities of ERMU Commission members when acting in their capacity as a Commission in accordance with applicable law. The Commission also establishes its expectations for the orientation of new Commission members. POLICY: The Commissioners of ERMU act in the interests of customers, employees and other stakeholders. ERMU stakeholders expect the Commission to make policy decisions that ensure appropriate organizational performance as set forth in the Commission's adopted Vision, Core Purpose, Mission, and Core Values. Consistent with this general statement: 1. The Commission will continuously create and enhance connections between ERMU and its stakeholders. 2. The Commission will produce, maintain and use written governing policies that, at the broadest levels, address each of the following categories of deliberation and decision- making. a. Authority and Purpose: Policies that recognize the Utilities' and Commission's right to exist, and authorities and policies to define organizational core purpose. b. Governance: Policies that specify how the Commission conceives, carries out and monitors its own tasks. c. Commission-Management Connection: How organizational authority is delegated, its proper use is monitored, and the General Manager is accountable for ERMU's performance. Page 1 of 2 28 ERMU Commission Policy—G.2d Commission Member Role, Responsibilities, and Orientation d. Delegation to Management: Limitations on executive authority that establish the prudence and ethics boundaries within which all executive activity and decisions must take place. e. Results: ERMU's outcomes, impacts and benefits. 3. The Commission will measure and evaluate the General Manager's performance against its Results and Delegation to Management policies. 4. Commission members will perform their responsibilities to protect and enhance the value of ERMU, exercising due diligence and using sound business judgment consistent with ERMU's enabling legislation and other applicable laws. 5. The ERMU Commission is committed to excellent governance. This requires that individual Commissioners be well-informed about ERMU, its customers and stakeholders,the utility business,prudent financial management, and the Commission's own governance structure and processes. Consistent with this commitment and Commission policies,the ERMU Commission will develop, implement and maintain current a formal orientation program for new Commission members. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 29 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2e Commission Member Conduct PURPOSE: With this policy,the Commission establishes its expectations for the ethical conduct and performance of ERMU Commission members. POLICY: The ERMU Commission commits itself to ethical, diligent, businesslike, and lawful conduct, including proper use of authority, performance of responsibilities, and appropriate good behavior. Consistent with this general statement: 1. Commission members are expected to be present, in person or electronically, at all regular and specially called meetings of the Commission, and any Commission committees to which they are assigned. 2. Commission members will properly prepare themselves to perform their assigned duties as Commission officers and members, and for effective Commission deliberation, decision- making, and representation in advance of all assigned meetings and other Commission- approved and Commission-related activities. 3. Commission members must, at all times, represent the interests of ERMU and its stakeholders. This accountability supersedes any conflicting loyalty such as advocacy to a personal cause or interest groups, and membership on other Commissions or employment in other organizations. 4. Commission members may not attempt to exercise individual authority over the organization except as explicitly set forth in Commission policies. Page 1 of 3 30 ERMU Commission Policy—G.2e Commission Member Conduct a. A Commission member's interactions with the General Manager or with staff must reflect that there is no authority vested in individual Commission members except when explicitly authorized by the Commission. b. A Commission member's interactions with public, media or other entities must reflect the preceding limitation and the inability of any Commission member to speak for the Commission except to repeat explicitly stated Commission decisions or actions already taken. c. Commission members will not make individual judgments of the General Manager or staff performance, except through the process established by the Commission's policy on Annual Evaluation of the General Manager. 5. Individual Commission members will never lead the public,media or staff to have the belief that the General Manager or any staff member is out of compliance with Delegation to Management Policies unless the Commission has made a formal determination of non- compliance. 6. Commission members will respect the confidentiality that is appropriate to issues and information of a sensitive nature. 7. Commission members are bound by, and will comply with, all State Statutes regarding conflicts of interest and Elk River City Code Sections 2-131 to 2-135. 8. In addition, Commission members will avoid any situation in which they stand to benefit individually through financial gain or influence. If such situations cannot be avoided, Commission members will disclose any known or potential conflicts, excuse themselves from any meeting during those times when the matter causing the conflict or potential conflict is under consideration, and abstain from any voting on the matter. 9. Depending on the circumstances, a Commission member may disclose any known or potential conflict to the Commission Chair, the General Manager, or ERMU's Legal Counsel. Legal Counsel will be available to advise the Commission, individually or collectively, about potential conflicts. Generally, an individual Commission member will first approach the Commission Chair or the General Manager about a potential conflict. Legal Counsel is also available to advise individual Commissioners in confidence about potential conflicts. 10. In support of ERMU's standards of high ethical conduct, Commission members WILL NOT: a. Deceive, defraud, or mislead other ERMU Commission members, management, or staff members or those with whom ERMU has business or other relationships. b. Misrepresent ERMU in any negotiations, dealings, contracts, or agreements. Page 2 of 3 31 ERMU Commission Policy—G.2e Commission Member Conduct c. Divulge or release any information of a confidential or proprietary nature relating to ERMU's purpose, mission,plans, business strategies, or operational databases d. Use ERMU property, financial resources, or services of ERMU personnel for personal benefit. e. Obtain a personal advantage or benefit through the use of ERMU's name, either directly or through relationships established by the General Manager, another Commission member, or any staff member. f. Accept individual gifts of any kind in connection with the Commission member's relationship with ERMU. g. Withhold their best efforts to perform their duties to acceptable standards. h. Engage in unethical business practices of any type. i. Violate any applicable laws or ordinances. POLICY HISTORY: Adopted May 9, 2017 Page 3 of 3 32 Elk River M Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2f Commission Officer Roles, Responsibilities, and Succession PURPOSE: With this policy, the Commission communicates the functions for which ERMU's officers are accountable and the limits of authority that the Commission delegates to its officers. POLICY: The offices of the ERMU Commission include a Chair, a Vice-Chair, and a Secretary. The Commission elects the Chair and Vice Chair to one-year terms each year during its regular meeting in the month of March. An officer's term begins that day and expires without action of the Commission upon resignation or death of the officer or upon failure of the officer to comply with the criteria necessary to hold the office. An officer's term is extended without action of the Commission until a successor is duly elected. Any Commission member is eligible for office at any time; however, a Commission member nominated for the position of Chair will normally have served at least one term as Vice-Chair. The office of Secretary is held by the General Manager; however,the General Manager may appoint another employee as Secretary, with the concurrence of the Commission. Chair The Chair is accountable to the Commission for the integrity of the Commission's governance process. The Commission authorizes the Chair to call and schedule special meetings, set its meeting agendas,preside over its meetings and,with limitations, represent the Commission to outside parties. The Commission expects the Chair to set and maintain a friendly and productive tone for all meetings, encouraging full participation of all Commission members, effective deliberation and decision-making, and constructive resolution of disagreements. More specifically: 1. The expected result of the Chair's function is that the Commission behaves in a manner that is consistent with its own policies and in full compliance with those obligations that others, with legitimate authority, impose on it from outside the organization. The Chair,by planning Page 1 of 3 33 ERMU Commission Policy—G.2f Commission Officer Roles, Responsibilities, and Succession the Commission's governance and meeting agendas will ensure that the Commission addresses those matters which, according to Commission policy, clearly belong to the Commission to determine,not to the General Manager. The Chair, by presiding over Commission meetings,will ensure that deliberation and decision-making at Commission meetings will be fair, open, and thorough, but also timely, orderly, and to the point. 2. The authority of the Chair is limited to Commission decision-making that falls within areas covered by Commission policies on Governance and Commission-Management Connection, except where the Commission specifically delegates portions of this same authority to others. The Commission authorizes the Chair to use any reasonable interpretation of the provisions in these policies in the discharge of duties. a. The Commission empowers the Chair to call and schedule all special meetings, set all meeting agendas, and preside over all Commission meetings with all of the commonly accepted power of that position(e.g., Ruling, recognizing, handling disagreements and unacceptable behaviors, etc). b. The Commission empowers the Chair, exercising reasonable discretion,to control the conduct of all meetings. This includes, but is not limited to, determining the time to be devoted to any particular matter before the Commission,whether any person in attendance may address the Commission on any subject and the order or duration of any presentations or comments permitted, closure of discussion on any matter before the Commission, and expulsion of any person whose conduct is disruptive. The Commission may, by a motion and majority vote of the Commissioners present, overrule the Chair on decisions related to the conduct of meetings. c. For purposes of meeting management,the Commission adopts the Rules contained in the current edition of Robert's Rules of Order Newly Revised for all situations to which they are applicable and in which they are not inconsistent with ERMU's bylaws,policies and any special rules of order that the Commission may adopt. d. The Commission authorizes the Chair to execute official documents on its behalf. e. The Commission empowers the Chair to organize the work of the Commission, and to assign specific tasks to Commission members and to Committees established by the Commission. Specifically, the Commission empowers the Chair to schedule and coordinate the annual process for performance planning and evaluation of the General Manager. f. The Chair has no authority to make decisions about policies created by the Commission within the Results and Delegations to Management policy areas. As a result,the Chair has no authority to supervise or direct the General Manager. g. The Chair may represent the Commission to outside parties in announcing Commission- stated positions and in stating decisions and interpretations of Commission policy within the areas delegated by the Commission. The Chair will report to the Commission, as Page 2 of 3 34 ERMU Commission Policy—G.2f Commission Officer Roles,Responsibilities, and Succession soon as practical, any communications made on behalf of the Commission. Representation of the Commission to outside parties is subject to the following limitations: i. Communications must be consistent with ERMU's core purpose, core values, and mission, and with the role and authority of the Commission as set forth by Commission policies. ii. Communications must, as far as practical, represent the collective wisdom or position of the Commission. iii. Communications must be limited to deliberations already conducted, actions taken, or decisions made. Communications must not be speculative in nature. h. The Chair may delegate the authority granted in this policy to others (e.g. Vice-Chair), but remains accountable for its use. Vice-Chair The principal function of the Commission Vice-Chair is to prepare for the office of Chair and to take over the functions of the Chair when the Chair is unavailable, or otherwise at the request of the Chair. Secretary The principal function of the Commission Secretary is to ensure that: 1. Notices of Commission meetings,meeting agendas, and supporting materials are prepared and distributed as required by Policy; 2. Appropriate written records of Commission meetings are prepared and distributed to all Commission members and the General Manager three (3) days prior to the next Commission meeting; 3. Resolutions and other official actions of the Commission are prepared and executed in proper form; and 4. Written records of Commission meetings, including resolutions and other official actions are archived in secure location(s) and disposed of in compliance with applicable laws and regulations. POLICY HISTORY: Adopted May 9, 2017 Page 3 of 3 35 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g Commission Committees PURPOSE: With this policy,the Commission establishes and communicates its purposes and the means by which it creates and empowers committees to assist the Commission in its work. This policy applies to any group formed by Commission action,whether or not it is called a committee and whether or not the group includes Commission members. It does not apply to committees formed under the authority of the General Manager. POLICY: Commission committees,when created,will be used to reinforce the wholeness of the Commission and never to interfere with the delegation of authority from the Commission to the General Manager or to any officer of the Commission. Commission committees will not have direct involvement with current management and staff employee functions. Consistent with this general statement: 1. The Commission will use committees sparingly and only for as long as required to accomplish its purposes. Committees may be appropriate in circumstances where the Commission recognizes the need for more in-depth review of information and issues, and where a committee is the best way to make effective and efficient use of available Commission member expertise and time. Committees may also be appropriate where it is necessary or desirable for the Commission to visibly demonstrate regulatory compliance or accountability to its stakeholders (e.g. Financial Reserves and Investments Committee). 2. Committees ordinarily will assist the Commission in the following specific ways by: a. Monitoring organization performance metrics and related information; b. Preparing policy alternatives and their implications for Commission deliberation and action; Page 1 of 2 36 ERM I Commission Policy—G.2g Commission Committees c. Determining the level of compliance with existing Commission policies and evaluating the results of policy compliance or non-compliance. 3. When the Commission creates a committee, it will develop and approve by resolution a written committee charter that sets forth the purposes, duration, expected outcomes, leadership,membership, delegated authority, available resources, and other information needed for the committee to function successfully. The General Manager will designate management/staff committee members if so requested. The Commission, by majority vote, will appoint Commission members to committees and remove or replace them, as appropriate. The Commission, by majority vote,will also appoint, remove, and replace a Committee Chair, Vice-Chair and any other positions of leadership that the Commission determines appropriate. 4. The Commission recognizes that appointments to a Committee provide opportunities for learning and Governance development. Accordingly,the Commission endeavors to appoint Commission members to committee leadership positions who do not already hold a Commission office. 5. The Commission will review the committee charter and performance of any standing committee at least annually to determine if changes are required or if the committee is still required. 6. Commission committees may not convene a meeting that includes a quorum of the Commission. 7. Commission committees may not speak or act for the Commission except when formally given such authority for specific and time-limited purposes. Expectations and authorities will be carefully stated in order not to conflict with authority delegated to the General Manager or Commission Chair. 8. Commission committees may not exercise authority over management and staff employees. The General Manager is accountable to the whole Commission and is not required to obtain approval of any Commission committee before taking an executive action. 9. Commission committees will avoid relating to or identifying with discrete parts of the organization rather than the whole. A Commission committee that has helped the Commission create policy on a particular subject will not be used to monitor organizational performance on that same subject, except with specific Commission approval. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 37 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g1 Wage & Benefits Committee Charter PURPOSE: The Wage and Benefits Committee exists to help the Commission develop and maintain a pay plan structure and benefits package that are market competitive, help promote employee retention, and to help the Commission make informed decisions which provide value to the customers through fair labor expenses. This Committee also exists to help the Commission with succession planning and review pay equity compliance. MEMBERSHIP: The Committee shall be comprised of two Commissioners,the General Manager, an administrative manager, and a field service superintendent. At no time shall there be a quorum of the Commission on the Committee. The Commission shall appoint Committee members annually following the Commission election of officers during the March Regular Commission meeting. The Commission shall also appoint the Committee Chair at that time. ROLE OF THE COMMITTEE CHAIR: The primary role of the Committee Chair is to run the Committee meetings. The Committee will adhere to the Current edition of Robert's Rules of Order Newly Revised for all situations to which they are applicable and are not inconsistent with ERMU's bylaws,policies, and any special rules of order that the Commission may adopt. The Committee meetings may be open or closed to employees at the discretion of the Committee Chair. AUTHORITY: Except as established in this Committee Charter,the authority of the Committee is limited to the purpose of research and recommendation to the Commission. The Committee, at the discretion and through formal action of the Commission, may be empowered beyond the role of research Page 1 of 2 38 ERMU Commission Policy—G.2g1 Wage &Benefits Committee Charter and recommendation such that it is consistent with the Organizational Core Purpose policies and the Commission Committees policy. SPECIFIC DUTIES: 1. At the request of the Commission, research and analyze topics related to employee compensation and benefits. 2. Annually perform market benchmarking and evaluate wages. The Committee shall present options and make recommendations regarding cost of living adjustments and pay plan structure modifications to the Commission for their consideration. 3. Review insurance policies and evaluate policy renewals related to employee benefit insurances. The Committee shall present options and make recommendations regarding these insurance policies to the Commission for their consideration. 4. Evaluate wage and benefit requests from employees. Present and make recommendations to the Commission as appropriate. 5. Review submittal information pertaining to pay equity compliance requirements and present options and make recommendations to the Commission as appropriate. 6. Record minutes of Committee meetings. Committee meeting minutes shall be subject to applicable data retention law and policies. SCHEDULE: At a minimum,the Committee shall meet on a quarterly basis. TERMINATION: The Committee shall exist until at such time formal action of the Commission is taken to dissolve the Committee. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 39 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2g2 Financial Reserves & Investment Committee Charter PURPOSE: The Financial Reserves & Investment Committee exists to help the Commission develop and maintain industry appropriate financial reserves and investment policies. MEMBERSHIP: The Committee shall be comprised of two Commissioners,the General Manager, and the Finance & Office Manager. At no time shall there be a quorum of the Commission on the Committee. The Commission shall appoint Committee members annually following the Commission election of officers during the March Regular Commission meeting. The Commission shall also appoint the Committee Chair at that time. ROLE OF THE COMMITTEE CHAIR: The primary role of the Committee Chair is to run the Committee meetings. The Committee will adhere to the Current edition of Robert's Rules of Order Newly Revised for all situations to which they are applicable and are not inconsistent with ERMU's bylaws,policies, and any special rules of order that the Commission may adopt. The Committee meetings may be open or closed to employees at the discretion of the Committee Chair. AUTHORITY: Except as established in this Committee Charter,the authority of the Committee is limited to the purpose of research and recommendation to the Commission. The Committee, at the discretion and through formal action of the Commission, may be empowered beyond the role of research and recommendation such that it is consistent with the Organizational Core Purpose policies and the Commission Committees policy. Page 1 of 2 40 ERMU Commission Policy—G.2g2 Financial Reserves & Investment Committee Charter SPECIFIC DUTIES: 1. At the request of the Commission, research and analyze topics related to financial reserves and investments. 2. On a periodic basis,the Committee will review the investment balances and the various investment instruments for return, liquidity, and diversification. The Committee may present options and make recommendations to the Commission for their consideration. 3. Annually,when the Commission designates the official depository for the year, it should provide for the Finance & Office Manager to recommend that additional depositories be designated for the purpose of investing funds. 4. On behalf of the Commission and Committee, new Investments will be authorized by the Finance & Office Manager, with the funds actually being transferred via a check produced by the A/P Specialist, and recorded in the check register detail presented at the regular Commission meetings. Investments that mature shall be reinvested by the Finance & Office Manager. All investing will be transacted working with the investment firm(s) or bank(s) for the best rate of return within the constraints of the ERMU Investment Policy. In the event that the Finance & Office Manager is unable to conduct the above investment responsibilities,the General Manager has the authority to act in his/her absence. 5. On a periodic basis,the Committee will review the Financial Reserves Policy and reserve balances. The Committee may present options and make recommendations regarding modification of the Financial Reserves Policy to the Commission for their consideration. SCHEDULE: At a minimum,the Committee shall meet on an annual basis. TERMINATION: The Committee shall exist until at such time formal action of the Commission is taken to dissolve the Committee. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 41 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Governance Policies Policy Reference: Policy Title: G.2h Independent Advisors to the Commission PURPOSE: The Commission expects to engage the services of independent advisors in order to effectively perform its functions. With this policy,the Commission establishes and communicates the purposes for which it may engage independent advisors and the process by which it engages those advisors. POLICY: Independent advisors are engaged to assist the Commission in its governance of ERMU. The Commission will engage independent advisors in the same manner that it expects management to engage independent professional service providers for other purposes. Only decisions of the Commission acting as a legally authorized decision-making body are binding on the independent advisors. Independent advisors; however, are expected to interact with the General Manager, management, and staff employees in the course of their work, and may have accountability to the General Manager. Consistent with this general statement: 1. The Commission may request and receive recommendations from the General Manager; however,the Commission will select its independent advisors and the independent advisors will have a direct reporting relationship and accountability to the Commission. 2. When engaging the services of any independent advisor,the Commission will comply with all applicable legal requirements, appropriate policies and procedures for requesting, receiving and evaluating proposals, and for contracting with professional service providers. Fees for the Commission's independent advisors will be paid from the Commission's budget account for Governance. 3. The Commission will engage the services of General Counsel to provide required or appropriate legal advice and assistance on all matters related to the functions and Page 1 of 2 42 ERMU Commission Policy—G.2h Independent Advisors to the Commission responsibilities of the Commission(individually and collectively) and with respect to actions taken or contemplated by the Commission. General Counsel will also be available to the General Manager for legal advice and assistance to management. 4. The Commission will engage the services of a recognized certified public accountant to conduct required independent financial audits of records and accounts and to provide required or appropriate financial and accounting advice and assistance with respect to specific actions taken or contemplated by the Commission. 5. The Commission may engage the services of other independent advisors as may be required or appropriate to the effective discharge of its responsibilities. These other independent advisors may include: a. Financial advisors to provide required or appropriate financial advice and assistance related to financial planning, issuance of debt, cost recovery, and other specific actions taken or contemplated by the Commission. b. Special legal counsel to provide required or appropriate legal advice and assistance with respect to specific actions taken or contemplated by the Commission. c. Consulting engineers to provide required or appropriate engineering and technical advice and assistance with respect to specific actions taken or contemplated by the Commission. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 43 Elk River �. Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3 Commission — Management Roles PURPOSE: With this policy,the Commission describes the general nature of its working relationship with the General Manager and distinguishes its role as the governing body from the role of the General Manager, management and staff. POLICY: The Commission will work with the General Manager as a leadership team. The Commission's principal role is to: 1. Hire a competent General Manager and support the General Manager by routinely engaging in collaborative performance planning and evaluation. 2. Develop and adopt policies for the governance of ERMU that set forth the results ERMU is to achieve and place limits on the authority of the General Manager to determine how those results are achieved. 3. Review and approve major plans,programs and budgets proposed by the General Manager (as required by the Commission's Delegation to Management policies). 4. Routinely monitor organizational performance and accept accountability for that performance. The General Manager's principal role,with the support of management and staff employees, is to: 1. Support the Commission in its development of policies. 2. Carry out the Commission's policies. Page 1 of 2 44 ERMU Commission Policy—G.3 Commission—Management Roles 3. Keep the Commission fully informed about compliance with the Commission's policies and the outcomes of those policies, including the achievement of results and the use of resources. 4. Manage and operate ERMU, accepting accountability for the performance of the organization in relation to the Commission's policies. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 45 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3a Controlling Authority PURPOSE: With this policy, the Commission affirms that its authority to direct the General Manager resides only in an official action supported by the affirmative vote of a majority of a quorum of the Commission members during either a regular or a called special meeting of the Commission. POLICY: Only decisions of the Commission acting as a legally authorized decision-making body are binding. Consistent with this general statement: 1. An individual Commission member or Commission committee cannot make decisions or recommendations, nor issue directives that are binding except in unusual instances when the Commission has acted to specifically authorize an individual Commission member or Commission committee to exercise such authority. This applies both during and outside of called meetings of the Commission. 2. When individual Commission members or Commission committees request information or assistance from management without first obtaining Commission authorization to do so,the General Manager may: a. Respond as requested, notifying all other Commission members of the request and the response provided. The General Manager may, at his or her sole discretion,provide copies to all other Commission members of any documents provided in the response. (Note: Other Commission members may request copies of any documents provided in the response and the General Manager is expected to provide them promptly). b. Refer the request to the Commission for consideration and direction before taking any action. The General Manager is not required to explain the basis for referring a request, but such basis could include a determination that the request may be sensitive or disruptive, or that it would require the expenditure of a material amount of staff time or funds that were not previously budgeted and scheduled for that purpose. (Note: the Page 1 of 2 46 ERMU Commission Policy—G.3a Controlling Authority Commission member making a request for information may also refer it to the Commission for consideration and direction, if the General Manager did not respond to the satisfaction of the Commission member.) POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 47 Elk River ,. Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3b Delegation of Authority to the General Manager PURPOSE: With this policy,the Commission describes the manner in which it delegates authority to the General Manager. POLICY: The Commission will provide direction to management only through the General Manager or through a temporary successor authorized by the General Manager or the Commission for a specific length of time. Except in unusual circumstances, the Commission will give direction by means of Commission action recorded in meeting minutes, by resolution, or by written policy that prescribes the results to be achieved as well as the actions and consequences to be avoided. The Commission will allow the General Manager to use any reasonable interpretation of its recorded actions,resolutions, or written policies. Consistent with this general statement: 1. The Commission will develop Authority and Purpose Policies, and Results Policies outlining high level priorities and instructing the General Manager to achieve certain results using the resources of ERMU that are made available through the approved Annual Business Plan (with budget). 2. The Commission will develop Commission-Management Connections Policies that establish the respective roles and responsibilities of the Commission and the General Manager. 3. The Commission will develop Delegation to Management Policies that limit the methods the General Manager(and, by further delegation, management)may employ to achieve the results required by the Commission. 4. The Commission will develop its Results Policies and Delegation to Management Policies methodically and by subject area, beginning with the broadest level and moving to more Page 1 of 2 48 ERMU Commission Policy—G.3b Delegation of Authority to the General Manager focused levels, at the Commission's discretion. The Commission will determine the level of policy definition and specification so that, once approved, Commission members are comfortable allowing the General Manager to interpret each policy without the Commission's involvement(unless the General Manager requests Commission involvement). 5. As long as the General Manager uses a reasonable interpretation of the Commission's Authority and Purpose Policies,Results Policies, and Delegation to Management Policies, the General Manager is authorized to establish all other management policies, make all decisions, develop all processes and procedures,take all actions, and establish all practices. 6. The Commission may, from time to time, change its Results Policies and Delegation to Management Policies,to allow the General Manager more or less latitude with respect to policy interpretation, decisions and actions. The Commission; however, will not use policy in this manner to reduce the latitude allowed a General Manager in situations where the person in that position is new or performing at an unacceptable level. As long as any particular policy is in place, the Commission will respect and support the General Manager's reasonable interpretations, decisions and actions. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 49 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3c General Manager Accountability PURPOSE: With this policy,the Commission affirms that the General Manager is the only person directly accountable to the Commission. POLICY: The General Manager is the Commission's only formal connection to the ERMU organization and is the only person directly accountable to the Commission for operating results and operational conduct. Additionally,the General Manager is accountable only to the Commission. From the Commission's perspective, the authority and accountability of ERMU management and staff employees is inseparable from the authority and accountability of the General Manager. Consistent with this general statement: 1. The Commission as a body and the Commission members individually will never give instructions (direct or implied)to anyone other than the General Manager. 2. The Commission as a body and the Commission members individually will refrain from evaluating, either formally or informally,the job performance of any employee other than the General Manager. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 50 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3d Monitoring Performance of the General Manager PURPOSE: With this policy, the Commission describes the manner in which it will routinely monitor the performance of the General Manager. POLICY: The Commission will ensure that it routinely and thoroughly monitors the General Manager's job performance. The performance of the General Manager will be measured by comparing ERMU's accomplishments with the Commission's Results Policies and by comparing ERMU's operational conduct with the specific delegations and limits established by the Commission's Delegation to Management Policies, and consistent with Authority and Purpose Policies. Consistent with this general statement: 1. Monitoring is the periodic review of objective, relevant,timely and accurate information that allows the Commission to determine the extent to which Commission policies are being carried out. Information that does not do this is not considered monitoring information and should not be a focus of the Commission. 2. The Commission will acquire the monitoring information it needs by either or both of the following methods: a. By internal report, in which the General Manager provides compliance information directly to the Commission. b. By external report, in which an objective external party, selected by the Commission, gathers information for the Commission. At the Commission's discretion,the external party may also evaluate compliance with Commission policies and report this information to the Commission. Page 1 of 2 51 ERMU Commission Policy—G.3d Monitoring Performance of the General Manager 3. Regardless of the method(s) employed,the standard for compliance with any policy shall be whether or not the General Manager made a reasonable interpretation of the Commission policy being monitored following its adoption. 4. The Commission will regularly monitor compliance with Results Policies and Delegation to Management Policies according to the schedule approved by the Commission in its biennial Governance Agenda. The General Manager will recommend a schedule using monitoring methods and frequencies. The Commission may monitor a policy at any time by any method. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 52 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Commission—Management Connection Policies Policy Reference: Policy Title: G.3e General Manager Performance Planning and Evaluation PURPOSE: With this policy, the Commission describes the manner in which it will routinely establish performance expectations for and evaluate the performance of the General Manager. POLICY: During the second quarter of each fiscal year,the Commission will evaluate the General Manager's performance for the preceding fiscal year and establish performance expectations for the next fiscal year. The General Manager's performance will be evaluated by comparing the organization's results and methods, as well as the General Manager's personal performance and conduct in relation to Commission policies and other expectations, as established and communicated by the Commission for the time period that coincides with the immediately preceding fiscal year. The Commission will conduct its evaluation within the boundaries of the Commission's policies and it's Employment Agreement with the General Manager. The Commission is responsible for the performance of the General Manager and may evaluate the General Manager's performance at any time the Commission determines that it is in the best interests of ERMU to do so. The evaluation of the General Manager will be based on: 1. ERMU's operational performance and conduct in comparison to the Commission's Results Policies and Delegation to Management Policies, and consistent with Authority and Purpose Policies. 2. ERMU's operational and fiscal performance and conduct in comparison to the ERMU Strategic Plan,Annual Business Plan (with budget),Financial Plan, and any other critical success factors established by the Commission. The General Manager shall propose with each Annual Business Plan the specific performance criteria that represent his/her reasonable interpretation of the Commission's performance expectations for the following fiscal year. The Commission and General Manager will discuss and agree in advance on the criteria to be used. Page 1 of 2 53 ERMU Commission Policy—G.3e General Manager Performance Planning and Evaluation 3. The General Manager's personal performance and conduct in interactions with the Commission,the Commission's independent advisors, customers, elected officials, employees, regulators, and representatives of other allied organizations or any other area deemed appropriate by the Commission and communicated to the General Manager. POLICY HISTORY: Adopted May 9, 2017 Page 2 of 2 54 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4 Corporate Limitations PURPOSE: With this policy,the Commission describes, at a high level,the limits that it places on the General Manager to determine the methods by which management and staff conform to Commission policies in the management and operation of ERMU. Other policies in this series place more specific limits on the prerogatives of the General Manager with respect to specific functions of management POLICY: The General Manager shall not cause or intentionally allow any practice, decision, action or circumstance within the ERMU organization that is unlawful, imprudent, or in violation of commonly accepted business and professional ethics. POLICY HISTORY: Adopted June 13, 2017 Page 1 of 1 55 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4a Succession of Leadership PURPOSE: With this policy,the Commission intends to ensure ERMU's continuity of leadership, both long- term and short-term. More specifically,the Commission intends to protect ERMU from the sudden loss of services by the General Manager, other executive managers, and any employee who performs functions that are critical to the organization. The Commission also intends to prepare employees at all levels of the organization for increasing leadership responsibilities. POLICY: The General Manager shall establish, and at all times maintain current, a short-term plan for executive leadership and critical function succession under which two or more of his/her direct reports are designated and prepared to temporarily assume the responsibilities of Acting General Manager on short notice. Consistent with this general statement,the General Manager shall: 1. Keep the Commission informed about the content of his/her short-term plan for executive leadership and critical function succession. The General Manager's plan for executive leadership succession shall include the designation of a primary and secondary successor, both of whom are acceptable to the Commission, and a written position description for Acting General Manager 2. Keep the Commission informed about his/her availability to perform the duties of the General Manager. 3. Not be absent from ERMU's offices and/or otherwise unavailable for communication with the Commission and other management employees for more than three (3) consecutive business days without first having designated a temporary successor and informing both the Commission and management employees of that designation. Page 1 of 2 56 ERMU Commission Policy—G.4a Succession of Leadership 4. Not allow the General Manager and both his/her primary and secondary designated successors to travel together in the same vehicle or other public or commercial form of conveyance. The primary successor shall immediately assume the responsibilities of Acting General Manager upon receiving information that the General Manager is unable to fulfill his/her responsibilities or has been absent from corporate headquarters and/or otherwise unavailable for more than three (3) consecutive business days without having designated his or her temporary successor. In such event,the Acting General Manager shall formally notify the Commission of his/her assumption of responsibilities, after which the Commission President shall convene a special meeting to confirm the appointment of the Acting General Manager and to either confirm or modify the position description for Acting General Manager. Additionally,the General Manager shall establish, and at all times maintain current, and effectively implement a long-term plan for leadership succession that is intended to: 1. Prepare all employees to grow in their leadership capabilities and responsibilities. 2. Ensure that the loss of services from any one employee does not impair the performance of the organization's critical functions. 3. Identify capable and willing people for future critical leadership positions and intentionally develop them in their leadership competencies and responsibilities. 4. Identify and communicate to the Commission any critical human resource needs of the organization that are not adequately met with available resources, along with steps that he/she is taking to meet those needs. POLICY HISTORY: Adopted June 13, 2017 Page 2 of 2 57 Elk River �. Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4b Information and Support to the Commission PURPOSE: With this policy,the Commission communicates its expectations for information and support from the General Manager. POLICY: The General Manager shall not permit the Commission to be uninformed or unsupported in its work. Consistent with this general statement,the General Manager shall: 1. Inform the Commission in a timely manner about ERMU's significant successes or shortcomings with respect to Commission policies, goals and other directives. 2. Submit timely, accurate, and understandable financial, operating and other monitoring data required by the Commission in a form that directly relates to the provisions of the Commission policies being monitored. (See Monitoring Performance of the General Manager Policy) 3. Report in a timely manner any actual or anticipated instance of management noncompliance with Commission policies. 4. Inform the Commission about significant events and situations that are directly relevant to the Commission's policies, especially any changes which may materially alter assumptions that the Commission has used previously to establish policy and make other significant decisions. 5. Advise the Commission if, in the General Manager's opinion, the Commission is not in compliance with its own Governance Policies and Commission-Management Connection Page 1 of 2 58 ERMU Commission Policy—G.4b Information and Support to the Commission Policies, especially where Commission actions or behavior(individual or collective) are detrimental to the working relationship between the Commission and the General Manager. 6. Advise the Commission if, in the General Manager's opinion,the Commission is unfocused in its work or out of step with ERMU's strategic framework(vision, core purpose, core values, mission and strategic objectives) as stated in the Authority and Purpose Policies. 7. Bring before the Commission in a timely manner as many internal and external points of view, issues and alternatives as the Commission may need to deliberate effectively and make fully informed decisions. 8. Bring to the Commission, in support of the Commission's deliberations and decision-making, the recommendation(s) of management,the rationale for those recommendations, and the process(es) by which those recommendations were developed. 9. Present information that is clear, concise, and in a form that differentiates among the purposes for which it is intended (i.e. monitoring, decision-making, business context, education, etc.). (See Agenda Planning Policy). 10. Provide appropriate methods and resources for official communications and other functions of the Commission, its officers, committees and independent advisors. 11. Communicate and work with the Commission as a whole, either directly or, as appropriate, through its officers and committees. 12. Supply for the agenda of any Commission meeting all matters that are required by law or contract to be approved by action of the Commission. POLICY HISTORY: Adopted June 13, 2017 Page 2 of 2 59 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4c Strategic and Business Planning PURPOSE: With this policy,the Commission affirms the importance of strategic and business planning and sets forth its expectations for the General Manager in terms of the effective development, implementation, monitoring, and updating of the Commission's approved Strategic Plan, Financial Plan and Business Plan/Budget. POLICY: The General Manager shall not allow ERMU to operate without the following Commission approved plans: 1. A Strategic Plan that provides strategic direction for a period of not less than five (5) future fiscal years in terms of high-level elements such as vision, core purpose, core values, mission, key result areas and broadly stated strategic objectives that are intended to achieve the organizational outcomes contained in the Commission's Authority and Purpose Policies. 2. A Financial Plan covering not less than five (5) future fiscal years (see Financial Planning and Budgeting Policy). 3. A Business Plan/Budget that supports accomplishment of the Strategic Plan and sets forth specific operating and financial results in terms of elements such as actions and outcomes, budgeted financial and other resource requirements, and projected financial statements. Consistent with this general statement,the General Manager shall: 1. Provide the overall direction, leadership, education, and resources needed to engage the Commission, management employees, key staff employees, and other key stakeholders in an effective strategic planning process. Page 1 of 2 60 ERMU Commission Policy—G.4c Strategic and Business Planning 2. Present to the Commission for approval a recommended Strategic Plan, a recommended Financial Plan, and a recommended Business Plan/Budget, as well as any subsequent changes to the approved plans that are needed to keep them relevant and effective. The Strategic Plan, as approved by the Commission,will include the high-level elements identified above. Consistent with the strategic direction approved by the Commission, management will implement, monitor, and periodically report to the Commission the status of the Strategic Plan through the use of goals, action plans, and performance measures. The Strategic Plan, Financial Plan, and Business Plan shall not materially deviate from the Commission's Authority and Purpose Policies. 3. Implement, if the Commission does not approve in a timely manner,the recommended Strategic Plan, Financial Plan, and Business Plan/Budget, as required to effectively manage the ERMU organization and utility enterprises. 4. Use the Strategic Plan as a guide and point of reference for preparing and updating the Financial Plan, Business Plan/Budget and other business management tools. 5. Communicate key elements of the Strategic Plan, Financial Plan, and Business Plan/Budget to ERMU's Commission, customers, employees, and other stakeholders at appropriate intervals to keep them well-informed about ERMU's operating environment, strategic direction and desired business and operational performance. 6. Report key business results and other operational outcomes to ERMU's Commission, customers, employees, and other stakeholders at appropriate intervals, using the Strategic Plan and Business Plan/Budget as a point of reference. Note: The ERMU Commission has established strategic and business planning as an important part of its own Governance Agenda(see Agenda Planning Policy). During the first quarter of each fiscal year(January-March),the Commission will review the most current adopted version of ERMU's Strategic Plan and Financial Plan, along with the results of the Business Plan/Budget for the preceding fiscal year. The Commission and Management will prepare, and the Commission will adopt an updated Strategic Plan and Business Plan/Budget before the end of each calendar year. During the second and third quarters of every third year,the Commission and Management will work together to re-develop, and the Commission will adopt a Strategic Plan for at least five (5) future fiscal years. Management will prepare, and the Commission will adopt during the fourth quarter(October—December)of each year a Business Plan/Budget that includes management's revenue/expense budget and projections, including relevant assumptions for two (2) future fiscal years. POLICY HISTORY: Adopted June 13, 2017 Page 2 of 2 61 Elk River �. Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4d Customer Interests PURPOSE: With this policy,the Commission communicates its expectations for the General Manager's understanding of customer needs and management/staff employee interaction with customers and customer representatives. POLICY: In all ERMU interactions with customers and customer representatives,the General Manager shall not intentionally allow situations,processes, actions,behaviors or attitudes that are unsafe, undignified, inattentive,disrespectful or unresponsive to customer needs and requests, or otherwise in conflict with the organizational values advocated by the Commission. (See Organizational Values Policy). Consistent with this general statement,the General Manager shall: 1. Keep the Commission and management/staff employees informed about customer expectations for and satisfaction with ERMU's services and conduct. 2. Keep the Commission and management/staff employees informed about current and emerging customer needs that are relevant to ERMU's core purpose and mission. 3. Provide relevant information to customers about ERMU services, using all appropriate media. 4. Keep customers reasonably informed about current and emerging issues, regulations,policies or practices that may affect their ERMU utility services and/or their use of those services. 5. Provide customers with convenient and secure access to their personal or business account information and to other information that will enable them to be informed and efficient Page 1 of 2 62 ERMU Commission Policy—G.4d Customer Interests consumers of the services that ERMU provides. 6. Comply with all applicable legal and regulatory requirements for collecting,reviewing, transmitting, and storing customer information to protect it against improper access and use, damage or loss, and unauthorized destruction. (See Legal&Regulatory Compliance Policy). 7. Keep customers reasonably informed about potential service outages, emergency preparedness, safe use practices,and service restoration status. 8. Provide customers with various means to express their service needs, concerns, or ideas to ERMU. 9. Promptly handle identified customer issues and utilize a dispute resolution process, if necessary,through which any unresolved issues are brought to the attention of the Dispute Resolution Committee for resolution. POLICY HISTORY: Adopted July 11, 2017 Page 2 of 2 63 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4e Core Customer Services PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning core customer services and related business opportunities. POLICY: The ERMU Commission expects the General Manager to ensure that customers receive safe, reliable, cost effective and quality long term electric and water utility services that directly support ERMU's core purpose and mission as stated in the Organizational Core Purpose Policy and Mission Statement Policy. ERMU's "core customer services" are retail electric and water services. Consistent with this general statement, the General Manager shall: 1. Identify and keep the Commission informed about the full range of business opportunities that are reasonably available to ERMU for the provision of its core customer services, bringing appropriate recommendations to the Commission for consideration and approval. 2. Keep him/herself and others in the organization informed about electric and water services trends,technologies, and practices through independent research,membership in appropriate organizations, and participation in appropriate industry workshops, seminars,and other similar opportunities. 3. Actively participate in relevant associations and advocacy groups,and stay informed about the national,regional, and state electric power and water supply markets,market participants, market management, and related legal and regulatory initiatives that may directly affect the interests of ERMU customers.Work to mitigate regulatory risks by acting on behalf of the interests of ERMU and its customers. Page 1 of 2 64 ERMU Commission Policy—G.4e Core Customer Services 4. Maintain professional and productive relationships with utility service providers,regulators, professional experts and others with whom ERMU must collaborate to create and execute successful business opportunities. 5. Clearly articulate and consistently demonstrate a high value proposition for customers who receive ERMU's core customer services. 6. Establish core customer service standards for reliability, cost, quality,regulatory compliance, and other factors important to ERMU's customers. 7. Routinely monitor and keep the Commission informed about ERMU's overall performance with respect to its core customer services standards,as well as ERMU's business strategies and initiatives to improve those services. The General Manager is expected to look for and consider new business opportunities but shall not implement any new core customer services or pursue any related business opportunities without legal authority and clear direction to do so from the Commission- approved ERMU Strategic Plan,Annual Business Plan or specific authorization of the Commission. POLICY HISTORY: Adopted July 11, 2017 Page 2 of 2 65 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4f Employee Interests PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the employment, termination of employment, management, compensation and treatment of employees. POLICY: In all ERMU interactions with and among the employees of ERMU,the General Manager shall not intentionally allow situations,processes, actions, behaviors or attitudes that are unsafe, illegal,undignified, inattentive or unresponsive to employee needs or requests, or otherwise in conflict with the organizational values advocated by the Commission. (See Organizational Values Policy). Consistent with this general statement: 1. The General Manager shall not allow ERMU management or the Commission to be inadequately informed about,or fail to exercise reasonable judgment and discretion regarding appropriate and timely action on,any issue of material significance concerning employee safety and health,performance, satisfaction and morale, or employment policies and processes. 2. The General Manager shall not operate without an Employee Safety Manual. 3. The General Manager shall not operate without proactive management support for a safety culture that includes expected compliance with the Safety Manual, participation in ongoing safety training, consistent use of safe work practices and personal protective equipment, reporting of unsafe conditions and safety incidents/near misses, and accountabilities for safety at the organizational,work group, and individual level. Page 1 of 2 66 ERMU Commission Policy—G.4f Employee Interests 4. The General Manager shall not operate without documented employment policies, processes, and practices that have been adopted by the Commission and communicated to employees in the form of an ERMU Employee Handbook. 5. The General Manager shall exercise reasonable judgment and discretion to avoid operating ERMU in material contravention of the Commission-approved employment policies, processes, and practices or any applicable employment law or regulation. 6. The General Manager shall adopt a reasonable process for notifying employees of material changes to the ERMU Employee Handbook and other applicable employee policies. 7. The General Manager shall adopt a reasonable process for conducting and documenting annual employee performance planning and evaluation in a manner consistent with the nature of each employee's duties. 8. Within the financial limitations of the budget approved by the Commission,the General Manager shall provide employees with safe working conditions, adequate facilities and equipment, and other support needed to enable high levels of employee performance,job satisfaction, and career development. 9. The General Manager shall not use methods of collecting, reviewing,transmitting, or storing employee information that fail to protect the information against improper access and use, damage or loss, or unauthorized destruction. POLICY HISTORY: Adopted August 8, 2017 Page 2 of 2 67 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4g Organization, Staffing, and Compensation PURPOSE: With this policy,the Commission sets forth the responsibilities of the General Manager with respect to the ERMU organization structure, staffing levels and position-based compensation practice. POLICY: The Commission expects the General Manager to continuously evaluate the human resource needs of ERMU and to advise the Commission regarding the organization structure, staffing levels,position-based compensation practice, and use of contracted services that will best achieve the organizational results set forth in the Goals and Results Policy,the Strategic Plan,and the Annual Business Plan/Budget.As set forth in the approved Policy establishing the Commission's Wage&Benefits Committee,the General Manager will keep the Committee fully informed and the Committee will periodically advise the Commission about the organization's human resource needs. The General Manager's responsibilities shall include: 1. Presenting to the Wage&Benefits Committee, at least annually and in conjunction with the Commission's review and approval of the Annual Business Plan/Budget, an Organization and Staffing Plan detailing overall staffing levels and organizational structure. 2. Presenting to the Wage &Benefits Committee, at least annually and in conjunction with the Commission's review and approval of the Annual Business Plan/Budget, an Employee Compensation and Benefits Plan. The Employee Compensation and Benefits Plan shall set forth market-competitive compensation ranges and benefits for each authorized permanent position in the ERMU organization. Included in the Employee Compensation and Benefits Plan which is presented for Commission approval shall be the Wage & Benefits Committee's recommendation of Cost Of Living Adjustment(COLA). Page 1 of 2 68 ERMU Commission Policy—G.4g Organization, Staffing, and Compensation 3. Presenting for Commission approval, as part of the Annual Business Plan, a Budget that will support the staffing and contracted services levels described in items 2 and 3 above. 4. Upon approval by the Commission of the Annual Business Plan, Budget, Organizational Chart and Employee Compensation and Benefits Plan,managing ERMU and its staffing and contracted services at the budgeted levels,with appropriate allowance for changes in workload requirements and the limitations of the market for qualified employees and contracted services. The General Manager shall assign specific responsibilities to the positions approved, shall designate the employees that fill specific positions and their compensation, and shall engage contracted services as provided in approved ERMU Policies. 5. If the Commission fails to timely approve the Annual Business Plan,Budget or Employee Compensation and Benefits Plan, managing ERMU and its workforce as necessary to serve ERMU's customers within projected revenues. 6. Considering the evolving utility industry, the changing expectations of ERMU's customers and stakeholders, advances in technology, relevant employment/service markets and other factors that impact ERMU's workforce requirements and its ability to meet those requirements. 7. Maintaining current and accurate organization charts that identify all authorized management and staff positions and their reporting relationships as well as the status of those positions (occupied or vacant). 8. Maintaining current and accurate position descriptions or equivalent documentation of the qualifications, accountabilities, and working conditions for each authorized permanent or temporary position in the ERMU organization. POLICY HISTORY: Adopted August 8, 2017 Page 2 of 2 69 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4h Financial Planning and Budgeting PURPOSE: With this policy,the Commission affirms the importance of financial planning and budgeting and sets forth its expectations for the General Manager in terms of the effective development, implementation, monitoring, and updating of the Commission's approved Financial Plan and Business Plan/Budget. (See Strategic and Business Planning Policy) POLICY: The General Manager will propose for Commission approval a Financial Plan that supports the Strategic Plan and provides credible projections of expenses and revenues (in major categories), reserve fund balances, and key financial ratios for not less than five (5) future fiscal years. The General Manager will propose for Commission approval a Business Plan/Budget for each fiscal year that is reasonably consistent with the projections contained in the Commission's approved Financial Plan. Within the financial limits established by the Commission through its approved Financial Plan and Business Plan/Budget,the General Manager shall provide adequate resources for the effective execution of the Strategic Plan and for the accomplishment of the specific operating and financial results contained in the Business Plan/Budget. Consistent with this general statement,the General Manager shall implement financial planning and budgeting that: 1. Is based on credible assumptions about variables that are likely to affect ERMU's future financial performance. 2. Includes credible projections of revenues, expenses, cash flow, mandatory and discretionary reserve funds, fund balances, and key financial ratios for a period of at least five (5) future fiscal years. Page 1 of 2 70 ERMU Commission Policy—G.4h Financial Planning and Budgeting 3. Includes credible projections of capital expenditures and borrowing needs. 4. Includes credible revenue requirements and general retail rate adjustment needs. 5. Recognizes the need for appropriate adjustments or contingencies that may arise during implementation as a result of changed conditions and unexpected events. 6. Clearly communicates the connection between planned expenditures of resources and the expected business results as identified in the Strategic Plan and the Business PlanBudget. 7. Does not violate the Commission's policy on Financial Condition and Transactions. 8. Provides financial support for the Commission's activities in the amount that is needed for the Commission to fulfill its statutory duties and to govern with excellence. POLICY HISTORY: Adopted August 8, 2017 Page 2 of 2 71 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4i Financial Condition and Transactions PURPOSE: With this policy, the Commission sets forth its expectations for the General Manager concerning ERMU's financial condition and transactions. POLICY: The General Manager shall not intentionally cause or allow ERMU's financial condition to become precarious or to materially deviate from the Financial Plan or Business Plan/Budget. The General Manager shall not allow financial transactions to occur outside of the boundaries established by other applicable provisions of the Commission's governance policies. The General Manager shall not allow financial reporting that fails to comply with applicable standards for governmental accounting. Consistent with this general statement,the General Manager shall: 1. Provide monthly financial reports to the Commission which accurately and adequately describe ERMU's financial condition. 2. Provide quarterly financial report presentations which discuss any material changes (1% or greater of annual revenues or expenditures for each utility enterprise)to the projections for the balance of the fiscal year including any appropriate remedial actions. 3. Not allow the cumulative expenditure of funds during a fiscal year to exceed by more than $1 million the amounts that have been allocated through the approved capital and operating budgets without prior approval by the Commission in the form of a budget amendment. 4. Advise the Commission of any individual project expenditure in excess of 10% above the approved budgeted amount. Page 1 of 2 72 ERMU Commission Policy—G.4i Financial Condition and Transactions 5. Not reallocate an amount greater than $500,000 among line items in the approved capital and operating budgets without prior approval by the Commission in the form of a budget amendment. 6. Advise the Commission of any financial transaction or event deemed by the General Manager to have a substantial impact on ERMU's financial condition. 7. Not take any financial action that violates bond covenants or otherwise jeopardizes ERMU's ability to obtain favorable bond ratings. 8. Not allow working capital and other designated reserves to fall below the levels established in the Financial Plan. 9. Make payroll and pay other financial obligations in a timely way. 10. Collect or otherwise resolve receivables. 11. Implement internal policies and procedures that comply and ensure timely accounting and reporting of financial condition and transactions in accordance with legal or regulatory requirements, and generally accepted industry practices. 12.Not acquire, encumber, or dispose of real property without approval of the Commission. POLICY HISTORY: Adopted August 8, 2017 Page 2 of 2 73 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4i1 Investments PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the investment of ERMU funds. POLICY: The General Manager shall not allow investments of ERMU funds that conflict with the requirements of applicable federal, state, and local laws and regulations governing the investment of public funds(Including Minnesota Statutes Chapter 118A. Deposit and Investment of Local Public Funds).Management responsibility for the investment program is hereby delegated to the General Manager, acting under the guidance of the Financial Reserves and Investment Committee Charter. The General Manager shall prepare for Commission approval and,upon approval, implement a Management Investment Policy that sets forth ERMU's policy, standard of prudence, objectives, delegation of authority, suitable investments,internal controls,performance standards and reporting requirements for ERMU investments. In addition,the General Manager shall inform the Commission routinely about ERMU's investment performance,the content and application of the Management Investment Policy,and other investment matters that support the Commission in meeting its fiduciary requirements. POLICY HISTORY: Adopted December 12,2017 Page 1 of 1 74 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4i2 Financial Reserves PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the maintenance of ERMU's financial reserves. POLICY: The General Manager shall ensure that ERMU maintains cash reserves for its electric and water utility enterprises that are reasonable,prudent and necessary to: 1. Meet or exceed the requirements of all bond covenants 2. Demonstrate to rating agencies and investors that ERMU's utility enterprises are credit worthy 3. Provide liquidity that is adequate, along with other risk-management measures,to ensure ongoing operation of the utility systems 4. Stabilize revenue requirements and customer rates 5. Manage the level of debt by funding a portion of the capital investments In addition,the General Manager shall prepare for Commission approval and,upon approval, implement a Management Financial Reserves Policy that sets forth the designated reserve funds to be maintained, along with their purposes and methods for determining appropriate target levels and requirements for internal controls,monitoring and reporting. Designated reserve funds may include,but are not limited to reserves restricted for debt service and unrestricted designated reserves. POLICY HISTORY: Adopted December 12, 2017 Page 1 of 1 75 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4i3 Debt Issuance and Payment PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning Debt Issuance and Payment. This policy is subsidiary to the Financial Condition and Transactions Policy, and relates to Financial Planning and Budgeting Policy, and Cost Allocation and Recovery Policy. POLICY: The General Manager,when preparing ERMU's Financial Plan and Business Plan/Budget for Commission approval,shall consider and present the benefits and costs of borrowing funds in relation to the benefits and costs of using income and revenues to secure adequate funding for infrastructure and operations. Factors to be considered and communicated to the Commission include,but are not limited to: revenue requirements,reserve fund balances,the cost of borrowing, the competitiveness of ERMU's rates and charges for services,the desired relationship between those who will receive benefit from the borrowed funds and those who will pay for retirement of the debt, and ERMU's overall financial condition and bond rating.Factors contributing to a favorable financial condition and bond rating include,but are not limited to: a consistent record of compliance with bond covenants, achievement of key financial ratios, determination of revenue requirements, establishment of adequate rates and charges for services, and compliance with generally accepted accounting and financial reporting practices. In addition,the General Manager shall: 1. Establish,as a part of any recommendation for the issuance of revenue bonds,adequate provisions for setting aside and pledging the income and revenue of the utility enterprise for which the bonds are issued into a separate and special fund to be used in the payment of the principal and interest on the revenue bonds. 2. Ensure that the income and revenues pledged for the bonds are allocated and deposited in conformity with the provisions of the revenue bond documents. Page 1 of 2 76 ERMU Management Policy— G.4i.3 Debt Issuance and Payment 3. Implement all necessary measures to assure that all required payments of principal and interest on the bonds are paid when due. 4. Monitor the accounts established under any bond documents to ensure that adequate funds are maintained therein, and recommend for approval by the Commission any transfer of funds required or permitted by the applicable law for the prudent operation of the utility. POLICY HISTORY: Adopted December 12, 2017 Page 2 of 2 77 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4i4 Procurement PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning procurement of supplies and services for ERMU. POLICY: The General Manager shall establish management policies,procedures, and practices for procurement that are consistent with the requirements of the most current version of or successor to Minnesota Statute 471.345 Uniform Municipal Contracting Law, and which implement and comply with the following: 1. Contracts for procurement which are estimated to exceed$100,000 in value shall be presented to the Commission for specific approval. 2. Contracts for procurement with a value of less than$100,000 do not require specific Commission approval,but the General Manager shall report on the procurement to the Commission at the next regular Commission meeting if the contract amount exceeds $25,000 and the item has not been previously approved by the Commission as part of the Business Plan/Budget. 3. Contracts for procurement with a value of less than$25,000 may be entered into by the General Manager or his/her designee without approval or reporting to the Commission,but shall be reflected in ERMU's financial records. In addition,the General Manager shall: 1. Designate specific delegated procurement authorities for selected ERMU managers and employees,by position title,based on type of procurement,dollar value, or other appropriate criteria. Page 1 of 2 78 ERMU Management Policy— G.4i.4 Procurement Policy 2. Keep complete and accurate records of all procurement contracts demonstrating compliance with applicable legal and regulatory requirements,this Commission policy, and established management policies,procedures and practices. 3. Inform the Commission, as soon as practical after discovery, of any material violations of this policy,Minnesota law, or the conditions of a Commission contract approval. POLICY HISTORY: Adopted December 12, 2017 Page 2 of 2 79 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4j Cost Allocation and Recovery PURPOSE: With this policy, the Commission sets forth its expectations for the General Manager concerning cost allocation and recovery of costs for ERMU's core customer services (See Core Customer Services Policy). POLICY: The General Manager shall operate ERMU in accordance with the Financial Plan(See Financial Planning and Budgeting Policy). Consistent with this general statement,the General Manager shall: 1. Annually report to the Commission on the performance and adequacy of ERMU's rates,fees, and charges for utility services with respect to revenue requirements,provide an updated projection of revenue and revenue requirements in the Financial Plan(See Financial Planning and Budgeting Policy), and recommend an appropriate plan for rate adjustments as needed. 2. Provide,at least once every ten(10)years or sooner at Management or Commission discretion,and in conjunction with development of the Financial Plan, a full cost-of-service rate study for each of ERMU's core customer services which fairly allocates costs among customer classes,provides for sufficient revenues, demonstrates that recommended rates are just and reasonable,and provides for competitive positioning with nearby service providers. 3. Recommend any new or adjusted rates, fees, or charges to the Commission for consideration and approval. 4. Implement any Commission-approved rates, fees, charges(or changes to same),provide adequate advance public notice and information to affected customers. Page 1 of 2 80 ERMU Commission Policy—G.4j Cost Allocation and Recovery 5. Apprise the Commission of and recommend any changes to existing cost-of-service allocation methods or practices concerning rates,fees,or charges that are inconsistent with good and accepted utility practice. POLICY HISTORY: Adopted August 8, 2017 Page 2 of 2 81 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4j1 Rates and Charges for Electric Service PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the establishment of rates and charges for ERMU's electric services, as well as the dissemination of information that customers and their agents require to be fully informed about the conditions under which ERMU provides those services (See also Cost Allocation and Recovery Policy). POLICY: The General Manager shall prepare for Commission approval and,upon approval, implement electric service tariffs that apply to the services provided to every designated customer class. Each tariff shall be public,kept current,and shall include,but not be limited to,the following information: 1. Availability of service 2. Special conditions 3. Fixed rate components 4. Variable rate components 5. Power Cost Adjustment(PCA) 6. Minimum bill 7. Terms of payment 8. Special provisions(if any) In addition,the General Manager shall: 1. Recommend rates that are developed from accurate cost accounting data, and the application of cost allocation factors and rate structures that are based on accepted electric utility cost-of- service ratemaking principles. Rates and charges for electric service shall be uniform between Page 1 of 2 82 ERMU Commission Policy—G.4j.1 Rates and Charges for Electric Service those customers located within the corporate limits of the City of Elk River and those who are not. 2. Prepare for Commission approval and,upon approval, implement a current schedule of fees and charges for related services that are not part of any published rate tariff. 3. Provide information and consultation that allows customers and customer agents to identify and apply for the rate tariff and type of service that result in the most favorable cost and conditions of service for the customer. 4. Make available to customers and their agents,at least annually, a current copy of the rate tariffs that are in effect. POLICY HISTORY: Adopted December 12, 2017 Page 2 of 2 83 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4j2 Rates and Charges for Water Service PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the establishment of rates and charges for ERMU's water services, as well as the dissemination of information that customers and their agents require to be fully informed about the conditions under which ERMU provides those services (See also Cost Allocation and Recovery Policy). POLICY: The General Manager shall prepare for Commission approval and,upon approval, implement water service tariffs that apply to the services provided to every designated customer class. Each tariff shall be public,kept current, and shall include,but not limited to,the following information: 1. Availability of service 2. Special conditions 3. Special charges 4. Rates and Rate Tier Definitions 5. Minimum bill 6. Terms of payment 7. Special provisions(if any) In addition,the General Manager shall: 1. Recommend rates that are developed from accurate cost accounting data and the application of cost allocation factors and rate structures that are based on accepted electric utility cost-of- service ratemaking principles. 2. Prepare for Commission approval and,upon approval, implement a current schedule of fees and charges for related services that are not part of any published rate tariff. Page 1 of 2 84 ERMU Commission Policy—G.4j.1 Rates and Charges for Water Service 3. Provide information and consultation that allows customers and customer agents to identify and apply for the rate tariff and type of service that result in the most favorable cost and conditions of service for the customer. 4. Make available to customers and their agents,at least annually, a current copy of the rate tariffs that are in effect. POLICY HISTORY: Adopted December 12, 2017 Page 2 of 2 85 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: Minnesota Municipal Power Agency G.4k Relationship, Representation, and Governance PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the relationship between Elk River Municipal Utilities (ERMU) and the Minnesota Municipal Power Agency (MMPA). By ERMU accepting the provisions of the Agency Agreement and By-Laws of MMPA through Resolution 13-5, and as parties to a full- requirements Power Sales Agreement and Membership Agreement, ERMU and MMPA have long-term obligations to each other with respect to wholesale power supply and delivery in which MMPA is the service provider and ERMU is the member. As parties to these agreements,ERMU represents the interests of its electric customers and the City of Elk River as one of MMPA's Member communities. ERMU also participates in the governance of MMPA through its representation on MMPA's Board of Directors. POLICY: The ERMU General Manager shall be ERMU's representative on the MMPA Board of Directors and a Commissioner shall serve as the alternate representative. The General Manager shall ensure that ERMU's contractual and working relationships with MMPA are handled in a collegial manner and with diligent attention to ERMU's best interests when ERMU is acting as an MMPA customer, and to balance the best interests of MMPA when ERMU is acting as an MMPA member. The General Manager shall make every reasonable effort to prevent the relationship between ERMU and MMPA from becoming contentious or unproductive. Consistent with this general statement,the General Manager shall: 1. Support MMPA by providing the staff time and other resources that may be reasonably requested by MMPA in connection with its services to and ongoing business relationship with ERMU as a customer. Page 1 of 2 86 ERMU Commission Policy—G.4k MMPA Relationship,Representation, and Governance 2. Make available to MMPA the leadership, staff support, and other resources of ERMU as determined necessary to support ERMU's interests as a member-owner while also ensuring that such support to MMPA does not jeopardize ERMU's own needs and interests independent of MMPA. 3. Communicate routinely about MMPA and its relationship with ERMU to the Board, employees, customers,and other stakeholders. POLICY HISTORY: Adopted September 12, 2017 Page 2 of 2 87 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.41 Protection of Assets PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning the protection of ERMU's assets. POLICY: The General Manager shall not allow ERMU's assets to be unprotected, inappropriately used or disposed of, inadequately maintained, or placed at undue risk. Consistent with this general statement,the General Manager shall: 1. Maintain comprehensive security program,property insurance program and loss prevention program which adequately protect ERMU from significant damage or loss to its corporate assets including, but not limited to,physical assets, real property, rights-of-way, corporate image or credibility, intellectual property, and information. 2. Not allow any investment of ERMU funds that violates State of Minnesota law, any provision of ERMU's bond indentures (as adopted and amended), or the provisions of any present or future Commission-approved investment policy (See Investments Policy). 3. Implement and maintain management policies and procedures that establish effective and sufficient controls with appropriate checks and balances, including separation of duties, which are regularly tested for adequacy and compliance. Functions that require such management policies and procedures include,but are not limited to designation of banking signatories and transactions,cash management,accounting, and procurement of goods and services. 4. Maintain a comprehensive physical asset inspection and proactive maintenance program consistent with accepted utility industry practice. Page 1 of 2 88 ERMU Commission Policy—G.41 Protection of Assets 5. Maintain comprehensive operating procedures aimed at safeguarding equipment and preventing improper wear and tear consistent with accepted utility industry practice. 6. Maintain a corporate records management program to safeguard paper and electronic files from loss, significant damage, or improper disposition in accordance with applicable laws and regulations (See Legal and Regulatory Compliance Policy). 7. Maintain competitive positions or business arrangements that safeguard's the business purpose and financial return of ERMU's assets. POLICY HISTORY: Adopted September 12, 2017 Page 2 of 2 89 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4m Corporate Risk Management PURPOSE: With this policy, the Commission sets forth its expectations for the General Manager concerning ERMU's corporate risk management. POLICY: The General Manager shall not allow ERMU to operate without a corporate risk management program which both identifies and assesses the risks which ERMU faces,and then prudently manages and mitigates risks which could negatively affect achievement of the Results Policies. Consistent with the preceding general statement,the General Manager shall: 1. Conduct, at least once every five (5) years, a risk identification and assessment that describes significant risks in terms of the cause or type and estimates ERMU's exposure to each including the potential range of financial loss (See Protection of Assets Policy). 2. Maintain, communicate and enforce an active risk management, mitigation and reporting program, including policies and practices. 3. Prudently protect ERMU,the Commission, management, and staff from claims of liability. 4. Protect ERMU against significant risks of loss using prudent levels of insurance coverage (See Protection of Assets Policy). 5. Maintain and comply with the Financial Reserve Policy (See Reserve Funds Policy) in conjunction with the Annual Business Plan. 6. Maintain an emergency/disaster preparedness and business restoration plan that is reviewed annually and adjusted as needed to cover changing risks and business requirements. Page 1 of 2 90 • ERMU Commission Policy—G.4m Corporate Risk Management 7. Engage competent legal counsel and maintain sufficient staff resources, internal review procedures, and controls to avoid imprudent contractual and legal risks (See Legal and Regulatory Compliance Policy). 8. Engage competent legal counsel/regulatory consultants and maintain sufficient staff resources and internal review procedures and controls to avoid regulatory risks due to non- compliance with applicable present and proposed future regulations (See Legal and Regulatory Compliance Policy). POLICY HISTORY: Adopted September 12, 2017 Page 2 of 2 91 4 Elk River .M Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policies Policy Reference: Policy Title: G.4n Legal and Regulatory Compliance PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning ERMU's compliance with laws and regulations that are applicable to ERMU. POLICY: The General Manager shall not cause or intentionally allow any practice,decision, action or circumstance within the ERMU organization that is unlawful or in violation of any applicable regulation. Consistent with this general statement,the General Manager shall: 1. Keep the Commission informed of legal and regulatory developments that could potentially impact ERMU and its operations, either positively or negatively 2. Retain the services of legal counsel and/or regulatory consultants and use such services as required to obtain timely and accurate advice and counsel on existing and proposed laws and regulations that are or may be applicable to ERMU. 3. Inform the Commission and the Commission's legal counsel of any known, suspected, or potential material violations of this policy as soon as practical after they are discovered. 4. Advise the Commission of appropriate responses to any known, suspected, or potential material violations of this policy based on advice from legal counsel,regulatory consultants, and ERMU management or staff. POLICY HISTORY: Adopted September 12, 2017 Page 1 of 1 92 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policy Reference: Policy Title: G.4o Environmental Stewardship PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning ERMU's environmental stewardship. POLICY: ERMU will make decisions and manage its operations with appropriate consideration of the environmental consequences and will encourage and enable customers to make wise use of the utility services that ERMU provides. Consistent with this general statement and as allowed by the Commission through the approved business plan and budget,the General Manager shall develop and implement policies,procedures, and programs that: 1. Provide customers with educational materials,programs,products,and other resources that promote and support the efficient consumption of energy and water. 2. Ensure that ERMU facilities are designed, constructed, operated, and maintained in compliance with applicable environmental laws,regulations,and permit requirements. (See Legal&Regulatory Compliance Policy). 3. Contribute to the visual appeal of the ERMU service area by maintaining and,where prudent and cost effective, enhancing the appearance of its facilities. 4. Support those customers who desire to produce on their premises,purchase from ERMU,or sell to ERMU electricity that is derived from recognized renewable resources.Note: ERMU will negotiate renewable energy customer contracts in good faith with the assistance of the Minnesota Municipal Power Agency(MMPA)and within the legal limitations of ERMU's contracts with MMPA,and consistent with state law. 5. Minimize the waste produced from its operations and reuse or recycle its waste products where prudent and cost-effective. Page 1 of 2 93 ERMU Commission Policy—G.4o Environmental Stewardship 6. Support ERMU leadership in promoting and participating in community dialogue about environmental issues and values associated with the planning, construction, operation, and maintenance of its facilities. POLICY HISTORY: Adopted October 10, 2017 Page 2 of 2 94 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Mangement Policy Reference: Policy Title: G.4p External Communications PURPOSE: With this policy,the Commission sets forth its expectations for the General Manager concerning ERMU's external communications. POLICY: The Commission expects the General Manager, or an authorized designee of the General Manager,to be the point of contact for communications between ERMU and external interests including the news media, state or federal governmental and regulatory bodies,and the elected or appointed leaders of governmental jurisdictions in which ERMU operates. Such designation does not preclude the Commission Chair(or other Commission officer or member specifically designated by the Commission)from speaking on behalf of the Commission concerning matters of Commission policy or Commission action. The Commission expects all external communications to be reasonably consistent,timely, accurate,and clearly stated,with appropriate protection of any information that has been designated as confidential. Consistent with the above general statement,the General Manager shall: 1. Protect information that has been designated confidential, except in those situations where the release of such information has been explicitly authorized by the Commission or required by law or regulation, including the Minnesota Data Practices Act(Minnesota Statutes, Chapter 13). 2. Adopt appropriate management policies and procedures to ensure that ERMU management and staff are fully aware of their individual responsibilities and limitations with respect to information management and external communications. These policies will include a data practices policy; a records management policy; and a communications policy. Page 1 of 2 95 ERMU Commission Policy—G.4p External Communications Note: See Commission Member Role,Responsibilities, and Orientation; Commission Member Conduct; and Commission Officer Roles, Responsibilities and Succession for related policy provisions concerning external communications by Commission Members and Commission Officers. POLICY HISTORY: Adopted October 10, 2017 Page 2 of 2 96 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Delegation to Management Policy Reference: Policy Title: G.4q Community Involvement PURPOSE: With this policy,the Commission establishes its expectations for the General Manager with respect to ERMU's engagement with the communities that it serves. POLICY: The General Manager shall be responsive to community needs and values by communicating proactively with community leaders and by maintaining a strong community presence in support of the Commission's Authority and Purpose Policies. Consistent with this general statement,the General Manager shall: 1. Develop, implement,monitor, and improve community engagement strategies and programs that align with ERMU's business objectives and are aimed at improving the quality of life in the various communities that ERMU serves. 2. Promote the economic vitality of the ERMU service area. 3. Promote Commission approved economic development incentives, special rates, or terms and conditions for utility services, as described in ERMU's customer service rules, regulations and rate tariffs. 4. Encourage and support employee volunteerism that supports ERMU's community involvement strategies and programs within the various communities served by ERMU. 5. Inform appropriate community leaders and customers of ERMU's community engagement strategies and programs and their benefits. POLICY HISTORY: Adopted October 10, 2017 Page 1 of 1 97 Elk River Municipal Utilities COMMISSION POLICY Section: Category: Governance Results Policies Policy Reference: Policy Title: G.5 Goals and Results PURPOSE: Well defined organizational core purpose policies are essential to establish goals, set criteria for organizational benchmarking and measurement, and ultimately produce desirable results. POLICY: The Commission will annually establish goals for the organization that are consistent with the Strategic Plan,Annual Business Plan (with budget) and Financial Plan. The Commission will annually review the results. POLICY HISTORY: Adopted May 9, 2017 Page 1 of 1 98 Elk River Municipal Utilities UTILITIES COMMISSION Reference Guide ERMUMN.COM I 763 441 2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 99 ,/j Elk River --- Municipal Utilities OUR OUR MISSION VALUES To provide our customers with safe, reliable, cost-effective and quality long-term electric INTEGRITY and water utility services.To communicate Honest,accountable and and educate our customers in the use of united in all that we do. utility services, programs, policies and future plans.These products and services Will be provided in an environmentally and QUALITY financially responsible manner. Services that reflect excellence, dependability and expertise. OUR VISION COMMUNICATION ,-�J4 Respectful and engaged interactions Provide exceptional services and that are timely and clear. value to those we serve. SAFETY OUR A culture that protects our FUNDAMENTALS customers,employees,and assets. Safety, Reliability and Quality of Utility Services. Customer Service and Employee Development. COMPETITIVE Competitive Rates,and Financial and Provide the best value for the Organizational Health. services we deliver. ERMUMN,COM I 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 Elk River Municipal Utilities OUR PLANNING THEMES THEME 1 I COMMUNICATION Improve the effectiveness of our communications inside the organization,with our customers and with the community. THEME 2 I PERSONNEL AND GOVERNANCE Develop our most valuable and vulnerable assets-our commissioners,employees, leaders, and future leaders. THEME 3 I STRATEGIC THINKING Create a culture of strategic thinking and ensure line of sight from mission to vision. THEME 4 I TECHNOLOGY Implement the prudent use of technology to improve efficiency and increase customer choice, communication and value. THEME 5 I GROWTH Assess the growth curve to make decisions regarding organizational change. THEME 6 I PROCESS, MEASUREMENT AND FINANCIAL HEALTH Improve processes and measurement to better determine and report efficiency and effectiveness of organization and to ensure financial and organizational health. ERMUMN.COM I 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 I i Electric&Water Customers Elk River 1 Municipal Utilities Utilities Commission 1 1 2019 Organizational Chart General Manager Updated:January 4,2019 45 FTE Executive Administrative :- Manager 1 Communications &Admin — Coordinator i —I— I I Water ;Technical Services Electric Finance&Office Conservation& Superintendent Superintendent Superintendent Manager Key Accounts Manager Lead Water OT Superintendent Assistant Electric ,Customer Service Operator 1 (Vacant) Superintendent Manager Credit& Water Operator — System Engineer Lead Lineworker —+ Lead Lineworker Billing Specialist — Collections Specialist GIS/Mapping Customer Service' Customer Service _ Water Operator Technician Lead Lineworker — Lead Lineworker Representative Representative Electrical Lineworker Lineworker Customer Service—Customer Service Technician Representative Representative Electrical Technician Lineworker Lineworker Accountant Locator Lineworker Lineworker — Accountant Line Crew AP/PR Specialist Locator Foreperson Meter Reader Field Crew Foreperson Inventory& — Procurement Foreperson H Lead Bore Rig Operator --Bore Rig Operator 102 Elk River M Municipal Utilities Utilities Commission Members Paul Bell Phone: 763-441-4267 Email: pbell@ermumn.com Term Expires: 02/28/21 John Dietz, Utilities Chair Council Representative Phone: 763-913-4933 Email: jdietz@ermumn.com Term Expires: 02/28/22 Allen Nadeau Phone: 763-286-7810 Email: anadeau@ermumn.com Term Expires: 02/28/20 Mary Stewart Phone: 763-241-0132 Email: mstewart@ermumn.com Term Expires: 02/28/22 Matt Westgaard Council Representative Phone: 612-889-6794 Email: mwestgaard@ermumn.com Term Expires: 02/28/20 ERMUMN.COM I 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 103 Elk River Municipal Utilities ERMU Website and Employee Intranet Commissioners can access the most recent commission meeting minutes and packets on ERMU's website. In addition, Commissioners also have access to ERMU's Employee Intranet that houses the most up-to-date Policy Book. The following is a step-by-step guide on how to access commission meeting documents and the policy book. Access ERMU Commission Meeting Minutes and Packets • Log onto our website at www.ermumn.com • Click-+ Residential Button • Click —> About Us • Click —* Either Commission Meetings to access Meeting Packets or Commission Meeting Minutes to access Minutes • Scroll to the exact meeting date you are looking for and click on it • For prior commission meeting minutes, packets or resolutions, please visit the City of Elk River's Laserfiche WebLink Access ERMU Policy Book • Log onto our website at www.ermumn.com • Click -* Residential Button • Click - About Us • Click — Employee Intranet Login • You will then be prompted to sign into your account with your email address and password • Hover over Policy Book and click on the section you would like to view • Then click on the policy you would like to view ERMUMN.COM I 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 104 Laserfiche WebLink Laserfiche WebLink is a user-friendly public portal to Laserfiche.WebLink hosts city,board and commission documents such as minutes,agendas, staff reports,resolutions, ordinances, planning items, etc.,in a Laserfiche repository to an intranet or the Internet in read-only form. How Do I Access Laserfiche? There are two ways to access Laserfiche. 1) Directly at http://webl-elkr.ci.elk-river.mn.us/weblink8/Browse.aspx?dbid=1. 2) By visiting the city's website at www.ElkRiverMN.gov. Hover over Services and Select Agendas and Meeting Materials. From that page, select Laserfiche. This will bring you to the Laserfiche Weblink. Access ERMU Commission Meeting Minutes, Packets and Resolutions • Click -*City Government folder • Click-eBoards and Commissions folder • Click—*Utilities Commission folder • Click*Minutes, Packets, or the Resolutions folder you would like to access. • Click -*Year you would like to access. • Scroll to the exact meeting date you are looking for and click on it. • All the documents for that meeting packet will be listed in the right window pane. • Click on the document you would like to open. They are listed by Item #. Item 1.0 typically is the agenda. The image format of the document will appear. Browse Tab-Click on this tab when you are in a document and you want to go back and open another document. Hit your browser's back button to return to the Browse screen in Weblink. Laserfiche Entre RepositoryE(gean:h Uc—,t WebLink Browse Search FI=R >;^t,Go.nm-ent>ct C un;ii>C Un;il,a9nd5 Pa)Kats>2011-2020 2011-2020 Name - Page Count Template Name Volume Name 2011 Eotty Properties 2012 fall Paul n�2013 Elkl9nenClty GovemmenttCRy CountllCoundl Agenda 3 Enbtes Packets/2011-2020 Creation Date 12f3a2010 8:55:59 Ass Last Modified 5/9/2013 314:45 PM A Metadaa No Meadaa Assigned Cow sort numporontpo-+pa*to w.nm*w.u..e.2,0 tssa-nu N:\Public Bodies\Handbooks\Laserfiche Weblink Instructions.docx 105 Search Tab-An overview of this function and the numerous ways to use it are provided on the search page when you open it up. Below is a sample copy of what the search screen will look like along with an explanation of some features. Laserfiche Search My Wanting Help snout Legout WebLink- Browse Search T.7 Cusicmhe Scorch Sort resold Oy.Mee l Beig'rd0CR I Peg mooed)Cate.Created Enter search Results 1-20 of 22006 Net' cbunca 111 6.2.SR 06.20-2011 City Hall-476 page(s) Page Count 478-Template Name:City Hall-Voume Name:CITY HALL-1 Page 1..TO 1E1.1 NDUSER Cl Council••-AGENOA SECTION UEERIG OATS PREPARED 6Y Comb_ Page 1..Apr`16.2011 Cay Council meeting.me Cty Counci mvelted son to begin r... Peon f 1 rooms one Coy Council Cached man to begin refodelen doeco.ngs for... Nee i...recess arc Morel Council tc hood Cubit nearing M retain Me neny and e... cane I..use perms.litre Council deternoea not to reva4 the tandaoral see peen On Show min 1*00rmauon: ▪5.2.PC SR 0541.2010 City Hall-516 page(s) Page Count 516-Template Name:City Hal-Volume None:CITY HALL-1 _nation to Me Coy Council on einelner to emend the eetietnq Condaanel Use Pe... pope'_...moons.the Cb Council adapted a me..en S0plamoer 2l.2009.cuing... Page,€...19,2010 is Cry council adopted a resounen realms Fndega of Fan and de... _Neel...pmved by tea CM Council an<Mom IC.2010.Coons Oboe staff report.S. Pave 2...H wort.61e Cry Council Resbb0n and the exn ng CUP and SnFL,as amend... On Show more information •0.4.SR 0547-2010 CRY Han-622 Oa2e(e) Page Count 622-Template Name:Crty Hall-Volume llama:CITY HALL-1 Pone a0...3-15 sletopoaan Coma Eneia:menbl&mites nduse1 Gieener9e Perms Pane of no spinnem<nrtne rninN1 In sinew nM bmrtae rnnna'nnawnycc wnn0.1 Three image formats are available when viewing documents using the Laserfiche Weblink: I) PDF Format PDF This is the best format to view and print documents, but it requires Adobe Acrobat Reader be installed on your computer. This is a free tool from Adobe and can be downloaded from www.adobe.com. To view and print: I. Click on the PDF icon J PDF A window will open asking what page numbers to print. Choose the appropriate options and choose "Download & Print." 2. To print the entire document, or multiple pages, click the print button and choose the appropriate options. 3. The document will open in either Adobe Reader or Adobe Acrobat. Use those buttons to manipulate and print the document. The names of the buttons on the toolbar will be displayed as you place your cursor over them. Do Not Use The Internet Browser Toolbar at the Top of Your Computer for Printing.) N:\Public Bodies\Handbooks\Laserfiche Weblink Instructions.docx 106 Icon Definitions P• revious Page Next Page PDF Download document and print to a PDF file Always use this button to print a readable copy of the document. 11 Pan Zoom and Pan Zoom In ( Zoom Out t F• it Page u TA F• it Width Hit your browser's back button to exit the document and return to the Browse screen in Weblink. 2) Image Format (not recommended for printing) View Image(s) Allows you to view the document as an image. Each time you open a document in Weblink, your document opens on your screen as an image. If you print an image format of the document, your document will be fuzzy. 3) Text Format View Plain Text Allows you to view plain text only in order to copy and paste words only. Use this format if you wish to copy and paste text into another software program. The document can be printed in this view; however, there will be no formatting and it will look different from the original image. N:\Public Bodies\Handbooks\Laserfiche Weblink Instructions.docx 107 OPEN MEETING LAW The Minnesota Department of Administration Data Practices Office has produced a short training video on the Minnesota Open Meeting Law. The following YouTube video will be presented at the April 9,2019 Special Meeting for the Annual Commissioner Orientation: Minnesota Open Meeting Law https://www.youtube.com/watch?v=e1cMYPGp9meY&feature=youtu.be 108 OPEN MEETING LAW The open meeting law applies to "any committee,subcommittee, department,board, or commission" of the city.With certain statutory exceptions,all board and commission meetings must be open to the public. Meetings may be closed only if closure is expressly authorized by statute or permitted by the attorney-client privilege. A meeting is a gathering of a majority of the members of a board or commission at which official business is discussed. It is not necessary that action be taken for a gathering to constitute a meeting. Serial meetings between groups of less than a quorum that are used to deliberate matters in order to avoid open meeting law requirements may also be found to be a violation,depending on the facts in the case.To understand how a serial meeting occurs,imagine that board member A talks to board member B about a city issue,board member B talks to board member C about that issue,and C talks to A. Serial meetings can occur through written correspondence,telephone calls,email,or through social media. See the enclosed Guidelines for Electronic Communications Between Members of Council, Commissions and Boards for additional information. Scheduling of meetings with the staff liaison will help prevent conflict with other groups over meeting times when public participation is particularly desired and could help prevent open meeting law violations. Intentional violations subject an individual to personal liability in the form of a civil penalty up to $300. 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Qo H (3Cs-� 4_, o U -, O > cn -0 — UCpHL Q) a) D C i ,2 C . 0 U O "- U) U) Z a) 'cn � a �.-C - a) O) CO c CO 0 to Q) O F—U (f) cu L. cu F--I W rc) .— O C C >, O o C z E2 0 � � (f) (, (U E4-' Q) +' EOcntn � 0 � � 0 E a) 0 p C E 0 O � I- CU �---, S. LU0 CU U (C) U L 1J ol (0 C no r� V 1 Z •v. 4 a--J a •'110 \ De O Q Ct r.CI) ra.1 W • co) I a) s. u V L _ ro rn U au u V Z Guidelines for Electronic Communications Between Members of Council, Commissions and Boards These guidelines apply to all members of the city council and all members of council and city committees, commissions, sub-committees, etc. in the City of Elk River. For purposes of these guidelines,reference to councilmembers includes members of all other city committees and groups subject to the Open Meeting Law. Reference to the council shall include all such groups and meetings. For purposes of these guidelines,"electronic means"means email,instant messaging, chatrooms, social media,microblogs and related electronic conversation. For purposes of these guidelines, "staff"means the administrator, city clerk, or his/her designee. These guidelines apply regardless of whether the councilmember is using a city-provided email address and account,his/her personal email address or account, or one provided by his/her employer;and to all social media accounts to which a councilmember posts. Meeting materials Electronic communication of meeting materials should generally be conducted in a one-way communication from a city staff person to the council. • Councilmembers may receive agenda materials,background information,and other meeting materials via email attachment or other electronic means (such as file sharing) from city staff. • If a councilmember has questions or comments about materials received, s/he should inquire via electronic means directly back to staff. A councilmember should not copy other committee members on his/her inquiry. • If the clarification is one of value to other councilmembers, staff may send follow-up materials or information to the council. Materials relating to agenda items of a meeting must also be made available to the public at the meeting. Communication during council meetings • Councilmembers should not communicate with one another via electronic means during a public meeting. • Councilmembers should not communicate with any member of city staff via electronic means during a public meeting. • Councilmembers should not communicate with the public via electronic means during a public meeting. Communication outside of council meetings • Councilmembers should generally act with caution when using electronic means to communicate with one another,being mindful of the Minnesota Open Meeting Law. Page 1 of 2 119 • If a councilmember wishes to share information with other members, s/he should do so through staff.The councilmember may request staff to distribute materials to others.The communication should not invite response to or discussion between any councilmembers,including replies to the person making the distribution request. This should be considered a method for providing one-way information to other members of the council. Again,remember that materials relating to agenda items for city business must be provided to the public at the meeting. • If a councilmember wishes to address only one other member through electronic means on any topic related to city business, s/he can do so directly but should be mindful of the following: o One-to one communication is ideal. o The recipient of an electronic message or inquiry should reply only to the sender, should not copy others on the reply,and should not forward the original communication to other councilmembers. o The sender of an electronic message should not forward or copy the recipient's reply to any other councilmember. o Neither the recipient nor sender should publish such correspondence on any blogs or other social media site unless it is part of an official communication of the whole of the Council,and part of the city-managed electronic communication strategy. • If a councilmember receives an electronic communication from any source related to city business and distributed to multiple councilmembers (i.e. an email sent to the entire council from a member of the public; or an email sent to three council members from a local business), s/he should reply only to the sender.The reply should not be copied to all the original distribution or forwarded to any other councilmember. • If a councilmember receives listsery distributions, electronic newsletters, or participates in electronic discussion forums,chatrooms, or on Facebook,Twitter or blogs where other councilmembers are also likely to participate,the councilmember should not reply to any distribution or comment so that the reply is copied to the entire distribution group,or any part of the group that might include other councilmembers. The councilmember should instead respond only to the sender of any message or inquiry. Classification and retention of electronic communications • Regardless of whether electronic communication by a councilmember is taking place on a city-provided computer,home computer or other computer system, classification of information as public,private or other is governed by the Minnesota Government Data Practices Act (Minn. Stat. Chapt. 13) and should be treated accordingly. • Councilmembers should retain electronic communications in keeping with city policies and procedures,whether such communication takes place on a city-provided computer,home computer or other computer system. Page 2 of 2 N:\Public Bodies\Handbooks\Electronic Communications.docx 120 DATA PRACTICES LAW The Minnesota Government Data Practices Act (MGDPA) is a series of state laws that attempt to balance the public's right to know what their government is doing,individuals'right to privacy in government data created,and maintained about them,and the government's need to function responsibly and efficiently. The Data Practices Law governs all data maintained by a public entity.There are three classifications of data: 1. Public—Accessible to anyone; 2. Private/non public—Accessible to the person who is the subject of the Data and to the governmental entity;and 3. Confidential/protected non-public—Accessible only to the governmental entity. The identity of individuals who register complaints concerning violations of state laws or local ordinances concerning the use of real estate/real property is confidential data. Data pertaining to members of boards and commissions is public governmental data: 1. Names of board and commission members are public. 2. Residential address. 3. Either a telephone number or electronic email address where the member can be reached, or both at the request of the appointee. Every city in Minnesota must comply with the MGDPA. Government data means all data collected, created,received,maintained, or disseminated by the city regardless of its physical form, storage media, or conditions of use. This includes data one receives or creates in the capacity of board member. The Act presumes that all government data are public and are accessible by the public for inspection and copying unless there is a federal law, state statute, or temporary classification of data that provides differently. Since the data a person collects,creates,receives,maintains,or disseminates in the capacity of board member is government data, a board member may wish to be careful about where the data is created, collected, etc. Government data can be easily, even accidentally, created at home or work that is both public and subject to a retention schedule and the board member may be required to produce the data if it is requested.Also,board members may wish to take care in what they say in their official capacity within emails or even text messages. There are significant civil penalties for willfully releasing private and confidential data and for willfully refusing to release public data. 121 CONFLICT OF INTEREST Conflict of interest questions arise periodically and can become complex. Generally,a legal conflict of interest occurs when you,as a member of a Commission,are slated to vote on a matter involving you and/or a business owned by you or a member of your family by blood or marriage.You could have a conflict of interest when the outcome could be economically advantageous to you, or to a member of your family,or to a business owned in whole or in part by you or a member of your family. In such cases,you have a responsibility to disclose this information to the Commission you serve and abstain from any discussion and/or vote on this matter. In addition to the above-mentioned situations,all Commission members must be aware of situations in which there is an appearance of conflict of interest. In some cases—such as an individual's alliance to an organization or group—a matter may be pending before the Commission which will not benefit you or a family member,but may leave doubt as to that member's ability to make an objective determination.Although there may not be any legal preemption from voting under such circumstances, discretion should prevail. The following points relating to conflict of interest are excerpts taken from ERMU Commission Policy- G.2e Commission Member Conduct: • Commission members are bound by,and will comply with,all State Statutes regarding conflicts of interest and Elk River City Code Sections 2-131 to 2-135. • In addition, Commission members will avoid any situation in which they stand to benefit individually through financial gain or influence. If such situations cannot be avoided, Commission members will disclose any known or potential conflicts, excuse themselves from any meeting during those times when the matter causing the conflict or potential conflict is under consideration,and abstain from voting in that matter. • Depending on the circumstances,a Commission member may disclose any known or potential conflict to the Commission Chair, the General Manager, or ERMU's Legal Counsel. Legal Counsel will be available to advise the Commission,individually or collectively,about potential conflicts. Generally,an individual Commission member will first approach the Commission Chair or the General Manager about a potential conflict. Legal Counsel is also available to advise the individual Commissioners in confidence about potential conflicts. 122 Elk River -�-~ Municipal Utilities P.5—Conflicts of Interest Policy 1.0 Conflicts of Interest Prohibited The credibility of ERMU rests heavily upon the confidence which citizens have in ERMU officials and employees to render fair and impartial services to all citizens without regard to personal interest and/or political influence. Thus, ERMU officials and employees must scrupulously avoid any activity which suggests a conflict of interest between their private interests and ERMU responsibilities. Officials and employees of ERMU, or their family members, shall not engage or have financial interest in any business or other activity which could reasonably lead to a conflict of interest with the official's or employee's primary ERMU responsibilities. Family members of an official or employee shall be deemed to be the official's or employee's spouse,parents, children, siblings, father-in-law, mother-in-law, brothers-in-law, and sisters-in-law and the lineal descendants of any of them. 2.0 Contracts with ERMU Commissioners and Employees A. Prohibition No sale, lease or contract shall be entered into by or on behalf of ERMU in violation of Minnesota Statutes, Sections 471.87—471.89. B. Procedure Contracts which are permitted by Minnesota Statutes, Section 471.87—471.89 may be entered into,provided the requirements of those Statutes are met, including: 1) A determination is made that the contract price is as low as or lower than the price at which the commodity or services could be obtained elsewhere. 2) The ERMU Commission approves the contract by unanimous vote. 3) If an ERMU Commissioner is the interested officer,that Commissioner shall abstain from voting on the matter. 4) The ERMU Commission passes a resolution, in the form attached, setting out the essential facts, such as the nature of the officer's or employee's interest and the item or service to be provided, and stating that the contract price is as low or lower than could be found elsewhere. 5) Before the contract is approved,the interested officer or employee files an affidavit, in the form attached,with the General Manager that contains the following: • The name and office of the interested officer or employee. 123 • An itemization of the commodity or services furnished. • The contract price. • The reasonable value. • The interest of the officer or employee in the contract. • That, to the best of the officer's or employee's knowledge and belief, the contract price is as low or lower than the price that could be obtained from other sources. 3.0 Examples of Prohibited Conflicts of Interest Examples of activities which are not in accordance with this policy include, but are not limited to, the following: 1. Acceptance by an ERMU official of any gift from an interested person in violation of Minnesota Statutes, Section 471.895; 2. Activities which require the official or employee to interpret ERMU policies or regulations when such activity involves matters with which the official or employee has business and/or family ties; 3. Consulting activities within the City of Elk River or the ERMU service territory if such consulting involves talents or skills primarily related to the official's or employee's ERMU work responsibilities; 4. Using an official's or employee's authority, influence or ERMU position for the purpose of private or personal financial gain; 5. The use of ERMU time, facilities, equipment or supplies for the purpose of private or personal financial gain; 6. Entering into a business transaction when it involves using confidential information gained in the course of employment; 7. Accepting other employment or public office where it will affect the official's or employee's independence of judgment or require use of confidential information gained as a result of ERMU duties; 8. Conducting personal business while working regularly scheduled hours; and 9. Accepting rebates or procuring any financial gain through the bidding process or employment of outside personnel. 4.0 Enforcement Any official or employee engaging in any activity involving either an actual or potential conflict of interest or having knowledge of such activity by another official or employee shall promptly report the activity to the ERMU General Manager or an ERMU Commission. The ERMU General Manager or Commission shall investigate the matter and make a determination as to whether or not an actual or potential conflict exists. If the ERMU General Manager or Commissioner determines a conflict exists, it shall be presumed that the continuation of the practice would be injurious to the effectiveness of the official or employee in carrying out his duties and responsibilities. In such cases the official or employee shall immediately terminate the conflicting activity or be subject to termination of employment or removal from office. Adopted June 12, 2012 124 Resolution Authorizing Contract with an ERMU Commissioner or Employee (under Minn. Stat. §§ 471.88, subd. 5 and 471.89, subd.2) WHEREAS, ERMU desires to purchase the following AND WHEREAS, is the of ERMU and will be financially interested in the contract; AND WHEREAS, it is determined that the contract price of$ is as low as, or lower than, the price at which the goods or services can be obtained elsewhere at this time; AND WHEREAS,the contract is not one that is required to be competitively bid; AND WHEREAS, has filed an affidavit of official interest as required under Minn. Stat. §§ 471.89 and the ERMU Conflict of Interest Policy; NOW BE IT RESOLVED,by the ERMU Commission,that ERMU staff is directed to make the above-mentioned purchase on behalf of ERMU from for a price of$ THIS RESOLUTION is passed to comply with the provisions of Minn. Stat. §§ 471.87- .89 and the ERMU Conflicts of Interest Policy. Passed by unanimous vote of the ERMU Commission as follows: Votes Aye Votes Aye Abstains By Chair By General Manager Dated: 125 Affidavit of Official Interest in Claim (under Minn. Stat. §§ 471.88, subd. 5 and 471.89, subd. 3) STATE OF MINNESOTA ) COUNTY OF ) I, , being duly sworn state the following: 1) I am the of the Elk River Municipal Utilities. 2) On ,the following goods or services were furnished by to ERMU: (specify the type of goods,merchandise, equipment or services that were purchased). 3) The contract price for such goods or services was $ and their reasonable value was $ 4) At the time such goods/services were furnished to ERMU, I had the following personal financial interest in this contract: (specify the nature of the personal financial interest). To the best of my knowledge and belief the contract price is as low as, or lower than,the price at which the goods or services could be obtained from other sources. I further state that this affidavit constitutes a claim against ERMU for the contract price,that the claim is just and correct, and that no part of the claim has been paid. Subscribed and sworn to before me this day of , 2012. (Notary) GP:3186227 vl 126 LT) N CT) l0 N C1 l0 M O N ,t co cn c-i c-i N to c-I N M In r-I N N c-I 00 Lf1 ri 00 tf1 (N C1 l0 M 0 N U- .--I c-I N Ll N--I N N LL c-1 N N M O N i--I L. N .--I 00 L in N Cl l0 S. F- ri ri N Cr) CUF' r-I N N QJ F- i--I e1 N d - A O ` N Ql lD Cr) O E - lD O N E > �Y ,-I LT) CD 5 > U > -- V v, Qr1 co if) N al O LT) N Ql l0 G7 CO 0 N c-1 0 F- rl N N Z F- c--I rl N in F- rl c-I N M CD- QJ N r' s--1 00 0o Ul N C1 l0 COO `� ri N N T-1 N 2 ri N M 3 QJ l0 M 0 N M O N Gt ri Co In N 01 C LO ‘--I N N (n i--I i--I N (n .--I N N o N Q v co C M D l0 M o N Cr) O N d' c-I N i--I CO CO ,-I N N (n rI ri N M N �--1 N N M Z CO 2 Ln N Cl l0 Na) l0 CO 0 l0 CO 0 N C i lU s--I .-I N U- 1--I N m U- r-1 N N OD CD N > • S. 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"O c-I N ri Ct co C) CM-I 0 IN N N M 0 N-I- N In M 0 i--1 N co p C C - rTo >' fl- e-i 0 es! Elk River Municipal Utilities 2019 UPCOMING EVENTS MMPA Annual Meeting - July 23, 2019 MMUA Summer Conference - August 19 - 21, 2019 - Breezy Point Resort ERMUMN.COM I 763.441.2020 I 13069 ORONO PARKWAY I PO BOX 430 I ELK RIVER,MN 55330-0430 128 Elk River Municipal Utilities Travel Expense Guidelines for Commissioners Meals Food allowances are actual expenditures for meals and gratuity, excluding alcoholic beverages. When employees travel and incur expenses to be reimbursed for meals, please use the following guidelines for spending. This spending amount is based on the IRS established "per diem" amounts for general spending of travelling individuals. Itemized receipts must be submitted for reimbursement. When travelling for the entire day,the maximum to be reimbursed per day is$55.That can be distributed as$10 for breakfast, $20 for lunch, and $25 for dinner.This distribution per day is variable, as long as the maximum is not exceeded. For example, if$5 is spent on breakfast, $30 could be spent on dinner. If there are multiple days involved,the distribution per days is also variable. For example, if$45 is spent one day, $65 could be spent the next day. If you are travelling for a partial day, and only one or two meals are involved, please use the guideline amounts per meal: $10 for breakfast, $20 for lunch, and $25 for dinner. If you are at an event where the meal is provided and included in the fee for the event, please have that meal unless there are extenuating circumstances why you cannot(such as allergies to certain foods.) Additionally,the IRS has established per diems for specific geographic areas of high cost. High cost areas are$76 per day,versus$55. So the per diem amount is different for Washington, DC (a designated high cost area) than Elk River, MN. If you are travelling to areas outside of Minnesota, and are concerned you may be visiting a high cost area, please feel free to visit the IRS website for a listing of these areas and discuss with your supervisor. Mileage The 2019 business mileage reimbursement rate is 58 cents per mile. Compensation Members of the Commission representing ERMU at meetings/conferences that are in addition to the commission meetings will receive a $75 per day stipend. 4/1/2019 129