6.1b ERMUSR 08-11-2020UTILITIES COMMISSION MEETING
TO:FROM:
ERMU Commission Theresa Slominski –Interim General Manager
MEETING DATE: AGENDA ITEM NUMBER:
August 11, 2020 6.1b
SUBJECT:
Staff Update
ACTION REQUESTED:
None
DISCUSSION:
There was an article published in the Forum newsfeeds that commission membersmay
have seen. The point of the article was that the large investor-owned utilities like Excel
Energy and Minnesota Power were required to continue suspendingdisconnections of
their customers during the pandemic, whilemunicipal utilities and cooperatives do not
have the same requirement. The article was fair to ERMU, accurately representing that
we would only disconnect those who were in arrears prior to the pandemic, whilenot
disconnecting customers who were financially impacted by the pandemic. The article is
attached.
The transition to everyone wearing masks has gone well. There is the whole spectrum of
feelings regarding it, from very happy to very frustrated, and I am sure we are not the
only organization with employees that feel that way. The next COVID-19 consideration
will be the school transition and working with staff as needed for varied schedules.
Sherburne County has some Coronavirus Aid, Relief, and Economic Security Act funds
available to assist residential customers with a variety of needs, including utility bills.
Staff is providing the County contact phone number to customers when working with
past due accounts.
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Major Minnesota utilities can't disconnect customers
during the pandemic — but local ones can
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ST. PAUL — Carla McElmury was already struggling to pay for her utilities
when she lost her job.
Having taken time off in late 2019 to heal from an operation to remove excess skin, the result of
an earlier gastric bypass surgery, she was no longer able to afford her gas bill. When the Good
Earth Village retreat center in Spring Valley, where she returned to work as a housekeeper in
January, laid her off because of the coronavirus pandemic, she fell behind on her water and
electricity bills, too.
By July, she owed the city of Spring Valley roughly $1,500.
The city had publicly pledged to not shut off late-paying customers' power in light of the
pandemic's economic toll. Yet McElmury received a disconnection notice in the mail anyway.
"It's not just me either. I know quite a few people who got the same notices I did," she said in a
phone interview.
Ultimately, the city did not turn McElmury's lights off, nor will it turn off anybody else's, Spring
Valley Utilities office manager Kristen Beck said. But it will continue mailing disconnection
notices.
Other municipal utilities have been less lenient. While state regulators are requiring large
investor-owned utilities like Xcel Energy and Minnesota Power to not disconnect their customers
during the pandemic, local ones have only been asked not to on a voluntary basis.
It is difficult to say how many households in Minnesota have had their power or gas shut off due
to non-payment since the pandemic began. Unlike their larger counterparts, Minnesota's
municipal utilities and utility co-operatives — which serve an estimated 994,000 residential
customers in the state, according to the Minnesota Municipal Utility Association — are not
regulated by the state Public Utilities Commission and thus have fewer centralized reporting
requirements.
More than 130 municipal utilities and co-operatives, however, did respond to a
March requestfrom the PUC to not disconnect late-paying customers, offer payment plans to
qualifying customers and cease charging late fees during the pandemic, according to PUC
filings. Later in June, the PUC made it mandatory for investor-owned utilities to maintain those
protections for as long Minnesota's ongoing peacetime emergency declaration is in effect.
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Roughly half of the 130 respondents said they would continue the protections for the length of
the peacetime emergency as well. But at least a dozen of them signaled in their filings that they
would extend them only until specific dates.
Nearly a third, meanwhile, did not specifically say in their filings how long they would extend
the protections. Many of the filings used boilerplate language, some of which contained no
mention of dates or timetables.
Thirty miles northwest of Minneapolis in the city of Elk River, the municipal utility recently and
briefly disconnected service to several of its customers, though city interim utility
manager Theresa Slominski could not immediately say how many. All were in arrears before the
peacetime emergency was declared, she said, and did not respond to repeated attempts at contact.
She said the city would not disconnect a customer facing financial difficulties related to the
pandemic.
"We would not be impacting anybody who is struggling under those circumstances. We have
people who have not paid us since the winter," Slominski said.
Other local-level utility officials interviewed for this story said much the same thing. Service
disconnections, they say, are a last-resort option for uncommunicative customers with long-
outstanding balances who, in some cases, did not even sign up for repayment plans.
Disconnections themselves are often brief, they say, and serve mostly as a way to get
uncooperative customers to pay at least some of what they owe. In the south-central city of
Windom, whose municipal utility ended consumer protections in June, city administrator Steve
Nasby said there's "a long process before we would ever get to disconnect."
"And that's essentially if the customer makes no effort. That’s the worst-case scenario," he said.
But regardless of whether an individual's financial problems stem from the pandemic, said Annie
Levenson-Falk, executive director of the advocacy non-profit Citizens Utility Board of
Minnesota, the state is still under an emergency declaration. Citizens are still being encouraged
to stay at home as much as possible, she said, and to practice social distancing when venturing
outside.
Some Minnesotans may not have returned to the workplace, she added, for fear of being exposed
to COVID-19 or in order to care for family.
"So that means people need to be able to eat at home and have running water...it's still even more
important than under normal circumstances that people have utility service," she said.
The impending loss of the extra $600 in federal unemployment benefits, meanwhile, threatens to
further pressure bill payers. The program furnishing the extra $600 ends this week, and Congress
has yet to agree on whether to replace or reduce it.
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The Congressional squabble continues amid a dismal job outlook for Minnesota. Though the
state's seasonally adjusted unemployment rate fell to 8.6% in June from a record 9.9% in May, it
was still double that of what was observed in the months leading up to March.
Municipalities and utility co-operatives, which only charge enough to break even, could
themselves struggle to purchase power if enough of their customers can't afford to pay their bills.
In southeast Minnesota, where the city of Caledonia has resumed the ability to disconnect
customers, city administrator Adam Swann said the predicament has no easy answers.
"It’s safe to say that we think the extra $600 has helped keep the utility accounts current. We do
anticipate that as unemployment benefits run out, both at the state and federal level, that we are
likely to see delinquent accounts increase," he said.
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