5.5 ERMUSR 05-10-2022UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Theresa Slominski –General Manager
MEETING DATE: AGENDA ITEM NUMBER:
May 10, 2022 5.5
SUBJECT:
Downtown Streetlights
ACTION REQUESTED:
Approve the Street Light Installation and Maintenance Agreement Between Elk River Municipal
Utilities and The City of Elk River, Minnesota.
BACKGROUND:
Last fall theDowntown Elk River Business Association (DERBA) approached ERMUrequesting
wreaths tobe hung on the streetlightsduring the Christmas season. ERMUagreed to workwith
the DERBA to see if they could find decorations that would work with the streetlights and sent a
memo summarizing all decorations attached to the streetlights noting that ERMU would bill the
DERBA for the labor involved with hanging and removing the decorations.
At the February 8 commission meeting, Chair John Dietz brought forward a request from
Council Member Jennifer Wagner to have the Utility donate the labor to hang and remove the
wreath decorations rather than invoice the DERBA. This was discussed at the March 8
Commission meeting and ERMU was tasked with providing an updated understanding of the
streetlight agreement with the City, either through policy or the existing Memorandum of
Understanding (MOU). We have decided to move forward with an Agreement rather than an
MOU.
DISCUSSION:
Attached is Streetlight Installation and Maintenance Agreement Between Elk River Municipal
Utilities and The City of Elk River, Minnesota. This agreementclarifies the understanding that
ERMU will maintain the streetlights downtown, hang banners as needed (but not annually),
install and remove wreaths annually, and install and remove flags on specified poles Memorial
Day through Labor Day. It also adds that the trail lights along Highway 10 are owned by the City
and ERMU will provide the labor for maintenance. Trail light maintenance will be provided as
contributions to the City, in line with our Payment in Lieu of Taxes and Other Donations to the
City policy, and proper accounting treatment.
Please note there are Appendices noted in the Agreement with maps identifying the specific
streetlights, trail lights, and poles. However, these maps are not available yet and ERMU and
the City will need to work together to create them. We can provide them to the Commission
when available, or if needed to approve the Agreement we would need to defer action to June.
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ATTACHMENTS:
2022 Streetlight Installation and Maintenance Agreement Between Elk River Municipal
Utilities and The City of Elk River, Minnesota
Memorandum of Understanding Regarding Streetlight Installation and Maintenance
Between Elk River Municipal Utilities and The City of Elk River, Minnesota1.1.2012
Commission Policy G.2a Commission-City Council Relationships and Roles
Commission Policy G.2a1 Payment in Lieu ofTaxesand Other Donations to the City of
Elk River
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STREETLIGHT INSTALLATION AND MAINTENANCE AGREEMENT
BETWEEN
ELK RIVER MUNICIPAL UTILITIES
AND
THE CITY OF ELK RIVER, MINNESOTA
This AGREEMENT, hereinafter referred to as “Agreement,” is hereby made and entered effective the
10th day of May, 2022, by and between the City of Elk River, Minnesota, hereinafter referred to as the
“City” and Elk River Municipal Utilities, hereinafter referred to as “ERMU”, and replaces the prior
Memorandum of Understanding between the parties dated January 1, 2012.
1.0 Purpose
The purpose of this Agreement is to clarify the following with regard to streetlights, semaphores, and
utility poles within the City of Elk River, Minnesota:
The ownership of streetlights and certain trail lights within the City.
Maintenance of semaphores within the City.
The installation of new and replacement streetlights in existing developments.
The material and labor costs associated with the installation and removal of City-approved
brackets on streetlights and utility poles.
2.0 Installation of New and Replacement Streetlights
ERMU shall provide as a contribution to the residents of Elk River all the material costs and labor
associated with the installation of new or replacement streetlights in street improvement and
rehabilitation projects located within the City. The City shall notify ERMU of street improvement or
rehabilitation projects under consideration on a timely basis to provide adequate time for design and
budgeting and will specify the number and location of streetlights to be installed.
Streetlights in new developments shall be installed by ERMU, pursuant to ERMU’s standards.
ERMU shall take possession of streetlight fixtures and associated public improvements that meet
City/ERMU standard when public improvements are accepted by the City.
3.0 Maintenance of Streetlights and Trail Lights
As owner of City streetlights, ERMU shall provide all material costs and labor associated with
maintenance all of streetlights located within the City. The maintenance of streetlights will include
lamping, ballasts, painting, and the locating of associated underground facilities.
ERMU shall also maintain the City owned trail lights along Trunk Highway 10 from Orono Park to
Downtown Elk River as a contribution to the City, and thereby the residents of Elk River (see map
Appendix I.) The city shall pay the material cost to replace said trail lights.
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4.0 Maintenance of Semaphores
ERMU shall provide as a contribution to the residents of Elk River, limited maintenance of semaphores
when such public improvements are turned over to the City for public ownership. The limited
maintenance of these semaphores will include lamping and the locating of associated underground
facilities.
5.0 Attachments of Brackets to Streetlights
Upon request by City, and when deemed possible by ERMU, ERMU shall attach brackets to certain
downtown streetlights within the City (see map Appendix II.) ERMU will maintain and replace the
brackets as necessary and will bill the City for labor and materials.
In order to avoid unnecessary wear and tear/maintenance issues, the brackets may be used only for the
following:
Hanging banners year round
Hanging planters in summer and wreath decorations during the holiday season.
The banners, plants, and wreath decorations shall be provided by the City.
ERMU will install replacement banners provided by the City when necessary, but not annually.
The City shall install, maintain, and remove the hanging planters seasonally.
ERMU will install and remove the wreaths annually, providing the labor as a contribution to the City.
6.0 Attachment of Flags to Specified Utility Poles
Flags will be installed on specific bracketed utility poles from Memorial Day to Labor Day in the
Mississippi Connections designated downtown (see map Appendix III.) Flags will be provided by the City
and installed and removed by ERMU.
7.0 Termination of Agreement
This Agreement may be cancelled or terminated without cause by either party by giving (30) calendar
days advance written notice to the other party. Such notification shall state the effective date of
termination or cancellation. Any and all amendments must be made in writing and must be agreed to by
the parties before becoming effective.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed by their duly
authorized representatives:
ELK RIVER MUNICIPAL UTILITIES THE CITY OF ELK RIVER, MINNESOTA
By______________________________________ By______________________________
John Dietz, Chair John Dietz, Mayor
By_______________________________________ By______________________________
Theresa Slominski, General Manager Tina Allard, City Clerk
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APPENDIX I
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APPENDIX II
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APPENDIX III
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COMMISSION POLICY
Section:Category:
GovernanceGovernance Policies
Policy Reference:Policy Title:
CommissionCity Council Relationship
G.2a
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
ustomers. 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
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 itsgovernance 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
governance with respect to the following:
a.Compliance with legal and fiduciary responsibilities;
b.Compliance with Commission-established Governance policies that are periodically
results, governance, and management.
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ERMU Commission Policy G.2a Commission City Council Relationship and Roles
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2.
repr
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
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 w
effective governance.
information to appoint persons who are appropriately qualified and well-informed about the
expectations for service as a Commissioner.
5.
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
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COMMISSIONPOLICY
Section:Category:
GovernanceGovernance Policies
Policy Reference:Policy Title:
Payment in Lieu of Taxes and Other
G.2a1
Donations to the City of Elk River
PURPOSE:
The success of ERMU is linked with the success of our community. And the success of our
community is linked with the operation of our city government and ERMU. ERMU was
purchased by the City of Elk River in 1945 and separate governance was created per State
Statute in 1947. Although governedseparately, ERMU is still an important component of our
local government and our city services.
It is typical for a municipal utility to provide a Payment in Lieu of Taxes (PILOT) and other
donations to their city, regardless of a separation of governance. Although typical, this
become non-competitive, or inhibit needed investment in personnel or infrastructure which may
r customers. For these reasons the PILOT and other
donations should be reviewed at least once every five (5) years by the ERMU Commission.
POLICY:
The PILOT and other donations to the City of Elk River shall be as follows:
1.Payment in Lieu of Taxes (PILOT)The PILOT transfer from Elk River Municipal Utilities
electric customers,except customers qualifying for the Transmission TransformedService
rate,within the corporate boundaries of the City of Elk River.
For the customers that qualify for the Transmission TransformedServicerate,thePILOT
transfer from ERMU to the City of Elk Rivershall befour percent (4%) of themargin
remaining from the evenly split charge per kWh to cover dispatching,billing, and
administrative costsincurredby the wholesale power provider and ERMU.
2.Donated ElectricityElk River Municipal Utilities shall donate all electricity to the City of
Elk River for street lights and signal lights.
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ERMU Commission PolicyG.2a1Payment in Lieu of Taxes and Other Donations to the City
of Elk River
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3.Donated WaterElk River Municipal Utilities shall donate water for use by the Elk River
Fire Department (ERFD) for the purpose of extinguishing fires within the City of Elk River
and other cities under contract with the ERFD.
For the purpose of creating ice rinks for public/ non-enterprise use, ERMU shall donate water
for use by the Elk River Parks Department.
Elk River Municipal Utilities shall donate water for the use by the Elk River Streets
Department for the use of street sweeping.
4.Donated LaborBecause of specialized skills and equipment, ERMU may be able to provide
a better value to our community by donating labor to the City of Elk River. For example,
ERMU has trained employees and the equipment to hang banners where the City does not.
In this example, ERMU is able to provide this donated service to the City for less cost than a
third party, creating greater value to our community. For such situations, ERMU shall donate
labor to the City of Elk River, as appropriate, where a greater value is created for our
community and where ERMU is not subjected to undue burden.
In addition to hanging banners, other examples include: maintenance of street lighting,
relamping signal lights, locating underground fiber optics and/or other facilities,
administration costs associated with the billing of city franchise fees, installation of
temporary lighting, relamping of city ball field lighting, installation and/or maintenance of
POLICY HISTORY:
Adopted December 6, 1994
Revised June 6, 2008
Revised July 2, 2013
Revised October 13, 2015
Revised January 1, 2016
Revised October 8, 2019
Revised May 11, 2021
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