3.1. SR 11-18-2019
The Elk River Vision
A welcoming community with revolutionary and spirited resourcefulness, exceptional
service, and community engagement that encourages and inspires prosperity
Request for Action
To
Mayor and City Council, Chair and Utilities Commission
Item Number
3.1
Agenda Section
Joint Meeting
Meeting Date
November 18, 2019
Prepared by
Troy Adams, P.E. – ERMU General Manager
Item Description
Elk River Municipal Utilities Overview
Reviewed by
Reviewed by
Action Requested
Review/update on Elk River Municipal Utilities.
Background/Discussion
In May, 2017, the Utilities Commission adopted Commission Policy G.2a Commission – City Council
Relationship and Roles. With this policy, the Commission describes its role in relation to the City Council
and the way in which it desires to interact with the City Council. The policy includes a requirement for
the Commission to provide an opportunity for the City Council to meet jointly with the Commission at
least once every three (3) years. The policy also outlines topics which the Commission will monitor and
report on to the City Council, some of which are also provided through Councilmember/Commission
updates to the Council. The policy is attached for reference.
Consistent with policy requirements, the Commission reports compliance with legal and fiduciary
responsibilities. And the Commission reports governing within Commission established governance
policies. The Commission retains legal counsel and financial audit professional services as advisors and
third party oversight ensuring compliance with legal and fiduciary responsibilities.
Additionally, the Commission reports that the Utilities have strong financials with ongoing focus on
competitive rates, proactive system maintenance, and effective short term and long term planning
ensuring safe, reliable, and cost effective utility services.
A short presentation will be given to provide a general overview of ERMU, highlight the numerous City
and Utilities collaborative efforts and partnerships, and discuss some current and future initiatives.
Financial Impact
N/A
C:\Users\tadams\Desktop\Commission Council Joint 2019 Meeting\Joint Meeitng Working Documents\Joint Meeting FINAL Documents\2019-
11-18 Joint Mtg - 3.1 ERMU Overview Memo.docx
Attachments
ERMU Commission Policy G.2a Commission – City Council Relationship and Roles
ERMU Overview - Presentation Slides
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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.
ERMU Commission Policy – G.2a Commission – City Council Relationship and Roles
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Page 2 of 2
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