7.2. SR 09-06-2005
Item # ,7. ;1:
MEMORANDUM
TO: Mayor and City Council
FROM: Pat Klaers, City Admip'j~trator
(l;)tr
DATE: September 6, 2005 v
SUBJECT: Utilities Commission Update
Councilmember J o11n Dietz is tlle City Council representati\Te on the Elk River IVlurucipal Utilities
Commission. At tile September 6, 2005 City Council meeting, John is sclleduled to pro,ride tlle
Council '\vidl an update on Utilities activities. ~\ttached are tile draft lninutes from the _August 16,
2005 Utilities Commission meeting.
s: \Counci/\Pat\ Updates \ Utilities. doc
ELK RIVER l\ruNICIP AL UTILITIES
REGULAR MEETING OF THE
UTILITIES COMMISSION
August 16,2005
Members Present: Jerry Takle, President; John Dietz, Vice Chair; James Tralle, Trustee
Staff Present: Bryan Adams, General Manager; Glenn Sundeen, Line Superintendent;
Theresa Slominski, Office Manager
Others Present: Pat Klaers, Cit)T Administrator
1. Call meetin2: to order AU2ust 16" 2005
Presidellt Jerry Takle called the August 16, 2005, meeting to order at 4:00 p.nl.
2. Consider Utilities A2enda
Janles Tralle moved to approve tlle August 16, 2005, Utilities Agellda \Vitll t11fee
additional itenlS for discussion under Other Business. Jolm Dietz seconded tlle motion.
Motion carried 3-0.
3. Consider Consent Aeenda
John Dietz 11ad questions regarding the fin31lcials, staffrespollded.
JaJl1es Tralle 11loved to appro\'e the Consent Agenda as fo11o\vs:
July Check Register
July 12, 2005, Minutes
Financials
John Dietz seconded the motion. :l\1otion eanied 3-0.
5.1 Staff Up-dates
Bryan Adams reported on the recent la\v changes that affect Elk Ri\Ter i\1Ul1icipal
Utilities. Iv1iIulesota la\v change ret1ects that addresses of board members are no\v COllsidered
private information. TIle Federal Energy Bill repealed PUHCA which \\~11 allovv n10re
Inergers of electric utility conlpanies. This could cause higl1er rates in the futme. The
:t\1imlesota Energy Bill has a pro\'ision allo\ving mUlucipal utilities to i11\lest in Transnlission
Companies or Transco. Further study is needed to determine tIle direct impact on Elk River
Municipal Utilities. Discussion follo\ved regarding energy, ethanol, and bio-diesel as alternate
fuel sources. Staff is looking into the financial in1plicatiolls of such projects and ~Till be
addressing tl1at in the future.
5th Street project is near completion other than a fevv inspectio11S. A fe\v oftlle \vater lilles had
to be cleaned out and there \vere lTIOre non-copper service lines replaced than anticipated.
Glen. Sundeen informed the COI1U11ission of the 30 new services ill tIle past montll. Staffis
currently rebuilding the line at the plant to support the nevv feeder, and also getting prepared
for tile Otsego project. There \vere a fevv outages \vhich COllsisted of animals and liglltning.
Page 2
Regular meeting of the Elk River Municipal Utilities Conunission
August 16, 2005
llleresa Slominski notified the Conunission \ve are cruTelltl)! interviewing for
clerk/receptionist position. The IRS tax issue is being dealt \'lith. An electronic payment
systelTI is being looked into as an optional source for customers to pay their bill. It \vould cost
the utilities $25.00 per 1110nth but vvould save time in tIle posting process.
5.2 Re\rie\\' Target Data Center Proposal
Staff cOlltinues to \'lork on the proposed Target Data Center facility. Brya11 Adams aI1d
Jerry Takle recelltly toured Target Data Center facilit:y in Brooklyn Park. Ryan COlnpanies,
\vorking on beIlalf of tIle Target Data Cellter, is asking for a \vill-ser\'e letter as plli1 of their
operational analysis. Elk Ri\'er MUlucipal Utilities respo11ded to tIlis \\~ll-serve letter with
sclledule, terms, and conditions thus con1illittillg our resources to tllis project. The question
still remains as to tIle form of assurance that adequate electric revenues \vill be derived frOll1
tills facility. Pat Klaers asked if Target has Inade a comnlitment as to 110\V lllaI1Y years they
\vollld be here. John Dietz asked if\ve \vould require a conunitlnent letter. Bryan Adams
replied we CalUl0t require one as it w.ould jeopardize our tax exempt bond status. Staffhas
confinned the expansion of Substation 14 \vith GRE using USG as engineers, along \vith
meeting Terry' f\1aurer, Cit)' Ellgineer and IvfNDOT to find the best electric feeder route and
avoid future problelTIs. A ne\v rate structure for tIle high capacity availability is being looked
into for tIle Target facility.
5.3 lJpdate Otse2o Grolvth
On August 8, 2005, Otsego City Council \vitIl Plmming Commission recolnmendation,
approved the expansion of tile Otsego substatiol1 located east of Packard Avenue off County
Road 39. The conditions oftIus expansion were to meet all set backs, bury the distribution
power lines running east, pro\tide a 42" \vide easement on north side of property for future
road expansion, paint or replace existing rnetallneter building (ovvned by \\lright-HelU1epin
Cooperative), provide a laIldscapillg plan, alld comply \\lith 110 overnigllt storage of\Telucles.
5.4 Re\rie,,, Antennas on Water To,vers
Previous requests for installing conununicatioll aI1terulas on utility water tovvers have
been denied due to safety, space, and maintenance issues. Elk River City council has
requested tIle utilities to reconsider due to zoning issues. At the J111y 25, 2005, City COUllCil
meeting, it \\'as the concensus of the cOlUlcil 111at \ve enter into negotiations \VitI1 the
teleconununications companies to allo\v aIltennas on our vvater towers instead ofbuildillg
telecomnlunication to\vers. Bryan Adams recently met with Nextel and discussed the options
available. Nextel was going to look into the height and location requirements and get back to
us. Staff is still \vaiting for a response. The concern Elk River Municipal Utilities I1as is the
security issues, the manpower stress it would put 011 the water department, and what \vould
Nextel be \\Iilling to pay for rentaL This "viII be readdressed at a later date. No action taken.
Page 3
Regular meetil1g of the Elk Ri\'er Mwucipal Utilities ConuniSSiOll
August 16, 2005
6.1 Re\rie,v 2006 Bud2et Schedule
Staff 11 as started the process of assel1lbling tIle year 2006 budget C.onu1lission revie\ved
proposed schedule of Travel & Training along witll personnel projectiollS. TIle Travel &
Trainillg budget is sinlilar to 2005 \vitIl sonle tninoI' cllanges. The persolmel projectiollS
reflect the addition of t\vo people. The first person is a supervisor for nletering, generation,
locating, 311d CAD operator. The second vvould be locator/CAD operator which is
necessitated due to the l1ew rule making, regllirillg \vater and \vaste \vater utilities to locate
their facilities in tIle public right Of\Va)T. John Dietz reconunellds checking with the City to
see if \ve could share an e111ployee.
6.2 Revie\v Lar2e Electric Capital Proiects
Otsego's growth, potential Target Data Center facility, aIld normal gro\vth l1ave initiated
a number of possible projects for the electric department. A list of projects and costs \vere
discussed alollg \vith the reasoning of \vhy \ve s110uld proceed 110\V instead of wait. Staff is
checking into b011d rates \Vitll IvlMDA and con\Tentional rates through the City. This \vill be
revisited at tlle next Commission n1eeting.
6.3 Re\rie,v Substation Transformer Purchases
Due to the continued grovvth in Elk River, a $600,000 project \vas scl1eduled to upgrade
two substatiollS in 2006. The original plan \vas to purchase a l1e\V 15 MV A 69KV transfo1111er
for West Substation and the existing 12 MV A 69KV substation transformer \vouId go to the
North Substation. Staff is recon1lllending 1101ding off upgrading the North Substation at this
time and i11stead upgrade the Otsego Substation. Bids for this transformer \vill be received on
August 30, 2005. TIus bid also contains an option for an additional 69KV trmlsformer for
Station 14 to accommodate the Target project. \\Te will ktlO\V nlore after the Target board
meeting on Septenlber 14,2005.
Other Business
Bryan Adanls revie\ved the 2005 Electric Distribution Capital Projects. Staff reconunends
delaying t\vo rebuild projects \vorth $245,000 and accelerating tIle Feeder 97 COllstruction
from Station 14 to West Business Park increasing the scope ofproject from $50,000 to
$250,000.
James Tralle moved to approve the cllange oftlle 2005 Electric Distribution Capital Projects.
Jolm Dietz seconded the motion. Motiol1 carried 3-0.
Jolm Dietz illquired as to \vhy the IaW11 at the po\ver plant looks so bad. Glenn Sundeell
info11ned mIn tl1at the sprinkling system was recently fixed ho\vever, he \vill have it checked
again as it still is not 'Yvorking properly.
Page 4
Regular meeting of the Elk Ri\rer MUlucipal Utilities Commission
August 16, 2005
Jo1m also \vas concerned about tlle proper identific.atio11 of Elk River Mtullcipal Utilities
employees. All employees should have an identification badge for cllstolners if they are to do
work in or near their home. It was suggested to use a bill stuffer or put an article in the next
Connector that is in the Elk River Star Ne\vs regarding \vhat to do if a customer is suspicious
of someone saying they are a City or Utility emplo)ree needing to get into their home.
Tl1ere was no other busi11ess.
The next regularly scheduled meeting of tl1e Elk River Mlmicipal Utilities COlnmissiol1
\vill be Tuesda)T, Septen1ber 13, 2005.
President Jerry Takle adjoun1ed the regular meeting of the Elk River :tvlU11icipal Utilities
COlnmission at 5:30 p.m.
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