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2.2 ERMUSR 02-08-2022ELK RIVER MUNICIPAL UTILITIES REGULAR MEETING OF THE UTILITIES COMMISSION HELD AT THE UPPERTOWN CONFERENCE ROOM January 11, 2022 Members Present: Chair John Dietz, Vice Chair Al Nadeau, Mary Stewart, and Matt Westgaard Present via Zoom:Commissioner Paul Bell participated in the meeting via interactive television as he was out of the state at the time of the meeting. ERMU Staff Present: Theresa Slominski, General Manager Melissa Karpinski, Finance Manager Tom Sagstetter, Conservation & Key Accounts Manager Michelle Canterbury, Executive Administrative Manager Mike Tietz, Technical Services Superintendent Dave Ninow, Water Superintendent Chris Kerzman, Engineering Manager Tony Mauren, Communications & Administrative Coordinator 1.0 GOVERNANCE 1.1 Call Meeting to Order The regular meeting of the Utilities Commission was called to order at 3:30 p.m. by Chair Dietz. 1.2 Pledge of Allegiance The Pledge of Allegiance was recited. 1.3 Consider the Agenda There were no additions or corrections to the agenda. Moved by Commissioner Nadeau and seconded by Commissioner Stewart to approve the January 11, 2022, agenda. Motion carried 5-0 2.0 CONSENT AGENDA (Approved By One Motion) Chair Dietz had a question on the check register regarding payments in amounts between $1- $5 being distributed to some employees. Ms. Karpinski explained that these paymentswere disbursed as acommission-approvedoffsetofthe taxes incurred from employee recognition awards.There was discussion. Elk River Municipal Utilities Commission Meeting Minutes January 11, 2022 Page 1 25 Moved by Commissioner Westgaard and seconded by Commissioner Nadeau to approve the Consent Agenda as follows: 2.1 Check Register – December 2021 2.2 Regular Meeting Minutes – December 14, 2021 2.3 Cogeneration and Small Power Production Tariff – Schedules 1 and 4 Motion carried 5-0. 3.0OPEN FORUM No one appearedfor open forum. 4.0 POLICY & COMPLIANCE 4.1 Annual Review of Committee Charters Ms. Slominski presented her memo on Annual Review of Committee Charters,explaining this is an opportunity for the Commission to make any adjustments they would like to see. She reminded the Commission that last year saw the introduction of the Dispute Resolution Committee. Chair Dietz asked who was named to the Committee. Commissioner Stewart answered that Mr. Bell and Mr. Westgaard represented the Commission. Chair Dietz asked if the Committee has had any disputes to resolve. Ms. Slominski responded that it has not and provided an explanation of its function. Ms. Slominski affirmed Chair Dietz’s question about whether staff would attempt to resolve disputes before it went to the Committee. There was discussion. Commissioner Westgaard had a clarifying question on the makeupof the Committee, wondering who the fifth member is given that only two commissioners, the administrative manager, and the field superintendent are named in the charter. Ms. Slominski responded that the fifth member would be the manager of the department wherein the dispute arises. 5.0 BUSINESS ACTION 5.1 Amended 2022 Annual Business Plan – Budget and Schedule of Rates & Fees Ms. Karpinski presentedthe Amended 2022 Annual Business Plan, noting it was brought back due to the rate adjustments from Minnesota Municipal Power Agency (MMPA) which allow ERMU to reduce its electric rate increase from 5% to 3%. Chair Dietz sought understanding as to whether the 3% increase will cover the power cost adjustments (PCA) staff expects for 2022. Ms. Karpinski explained that thenew budget Elk River Municipal Utilities Commission Meeting Minutes January 11, 2022 Page 2 26 does include expected adjustment charges for 2022. Ms. Karpinski did note that ERMU would be billing PCAs for the first part of 2022 to cover costs from 2021. Chair Dietz asked when ERMU appliesthe $500,000 established in the 2022 budget to absorb at least a portion of PCA charges that would otherwise be passed on to customers. There was discussion on the fact that the utilities absorb the first adjustments it receives from the power provider, MMPA, up to that amount. Commissioner Stewart provided industry background on PCAs. Chair Dietz asked what the final rate increase MMPA passed on to ERMU was. Ms. Slominski responded that it was a 6% overall rate increase.There was discussion. Moved by Commissioner Westgaard and seconded by Commissioner Bell to adopt the Amended 2022 Annual Business Plan. Motion carried 5-0. 5.2 Financial Report – November 2021 Ms. Karpinski presented the November 2021 Financial Report, noting there is an extra line for rate increases as the auditors have approved the accrual of funds for 2021 PCAs from 2022 billings. Moved by Commissioner Stewart and seconded by Commissioner Nadeau to receive the November 2021 Financial Report. Motion carried 5-0. 5.3 Field Services Facility Expansion Project Update Mr. Kerzman provided his update on the Field Services Facility Expansion Project, noting progress has slowed with the cold weather and the holidays but that he was optimistic good progress would be made over the next month. Mr. Kerzman offered to answer any questions. Chair Dietz wondered how long it would take to install the roof. Mr. Kerzman responded that the roofer’s schedule provides for 6 weeks. Chair Dietz asked how much work could be done inside the building before the roof is installed. Mr. Kerzman responded that the electrician and plumbers are completing what they can but the portions of work that require warm weather are on hold until the roof is complete. Chair Dietz asked about the timeline for pouring the concrete floor. Mr. Kerzman responded the contractor seems to be leaning towards delaying the pour until other work is complete to minimize the risk of damage. Commissioner Westgaardasked if therewere projections onthe timeline forwindows and overhead doors, noting his experience that many projects are waiting for these items. Mr. Kerzman responded that thewindow supplier ordered supplies with plenty of lead time and Elk River Municipal Utilities Commission Meeting Minutes January 11, 2022 Page 3 27 were projected, he believed, to start installation that week. He added the overheaddoors will likely be installed closer to the end of the project. 6.0 BUSINESS DISCUSSION 6.1 Staff Updates Chair Dietzinquired about the communications to customers on the 2022 rate increasesthat the Commission receivedfor review, wondering if it may be too long. Ms. Slominskiexplained that the information would be provided within ERMU’s quarterly newsletter, The Current, and that what the Commission receivedwas a typicallength for that publication. Ms. Canterbury went on to add that she would work with staff to break up the information when it is distributed through other communications channels. Mr. Ninow shared his hope to bring an update to the February commission meeting on discussions for the cost of water main work occurring on County Road 13. Currently staff from Elfering & Associates is working on ERMU’s behalf to verify that the reported costs from the contractor are accurate. There was discussion. Chair Dietz asked for an update on the progress of the work ERMU’s water department is expected to complete for the Highway 169 Redefine project. Mr. Ninow provided information about the progress of the work, noting there is a fair amount left to be done. There was discussion. 6.2 City Council Update Commissioner Westgaardprovided an update on City Council initiatives including a property development on Jackson Avenue, and a postponed easement vacation. There was discussion. 6.3 Future Planning Chair Dietz announced the following: a. Regular Commission Meeting – February 8, 2022 b. 2022 Governance Agenda 6.4 Other Business Chair Dietz called the Commission’s attention to an article in the Star Tribune about Connexus Energy from January 8, 2022. There was discussion. Chair Dietz provided background on a community discussion about the acquisition of the property for the Field Services Facility Expansion project. There was discussion. Elk River Municipal Utilities Commission Meeting Minutes January 11, 2022 Page 4 28 7.0 ADJOURN REGULAR MEETING Moved by Commissioner Nadeauand seconded by Commissioner Westgaard to adjourn the regular meeting of the Elk River Municipal Utilities Commission at 4:01 p.m. Motion carried 5-0. Minutes prepared by Tony Mauren. ___________________________________ John J. Dietz, ERMU Commission Chair ___________________________________ Tina Allard, City Clerk Elk River Municipal Utilities Commission Meeting Minutes January 11, 2022 Page 5 29