5.04 ERMUSR 11-14-2023��i
Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO:
FROM:
ERMU Commission
Mark Hanson — General Manager
MEETING DATE:
AGENDA ITEM NUMBER:
November 14, 2023
5.04
SUBJECT:
2024 Utilities Fee Schedule
ACTION REQUESTED:
Approve the 2024 Utilities Fee Schedule for Adoption into Ordinance by the City Council
BACKGROUND:
Typically, the Elk River Municipal Utilities Commission approves the budget in December. In
January, the rates and fees are published. Per legal counsel, ERMU's ability to collect on fees
would be strengthened by having them listed as part of the City's Master Fee Schedule and
adopted into city ordinance after being approved by the Commission.
DISCUSSION:
Annually ERMU staff reviews the proposed fees for the upcoming year. Proposed changes are
outlined below and highlighted in yellow on the attached fee schedule.
*Designates a proposed NEW fee.
ELECTRIC FEES
After evaluation of our schedule of rates/aid to construction methodology, staff reviewed our
current fee schedule to determine any necessary adjustments. Based on the review, staff is
recommending the following changes:
New Residential Electric Connection — Developer — Lot without ERMU Water Service — A
proposed increase from $1,075 to $1,475. For 2023, the proposed increase of the fee was from
$575 to $1,475. At that time the Commission supported a two-year implementation of the
increase. This amount reflects material cost increases, mostly transformer costs. The larger lot
sizes which are more common outside the water service area require crossing a longer distance
to install electric service.
New Wire Footages over 200' (per foot) — A proposed increase from $4.00 to $5.00 due to
material cost increase.
New Service Frost Trenching (per foot) — A proposed increase from $5.00 to $6.00 due to labor
cost increase.
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*Grid Access Fee — Proposed fee of $5.56/kW in excess of 4 kW. The fee would be a means to
cover distribution costs not included in the monthly electric customer charge, which would
avoid cross subsidization of fixed costs. The $5.56 amount was calculated in our 2019 rate study
provided by Dave Berg Consulting. The fee would only apply to new solar interconnections
starting January 1, 2024.
Pole Attachment Fee (per pole) — No proposed fee increase. Proposing to add language to the
Pole Attachment agreement to include penalties for late payment.
WATER FEES
Abandoned Water Service— No proposed fee increase. Proposed adding the word (minimum).
This proposal aligns the fee schedule with ERMU's Water Service rules.
ADMINISTRATIVE FEES
*Administrative Fee for Continued Submission of Payment after Account Closed— Proposed
$20 fee to mirror the current Administrative Fee for Continued Submission of Checks after No -
Check notice given. Staff finds this to be in line with industry standards.
Manual Meter Reading Fee (per month) — A proposed increase from $10 to $50. In addition to
the increase in the fee, staff proposes moving the fee from the Electric and Water sections of
the fee schedule to the Administrative Fees section. This increase in the manual meter reading
fee is in line with industry standards as utilities move to automated meter reading. The fee
would cover the costs associated with dispatching employees into the field.
*Manual Meter Reading Fee (per month) — After the initial $50 manual meter reading fee each
additional meter manually read will be charged $10.
In addition to the proposed fees outlined above, we are also proposing to add language to the
fee schedule indicating that federal, state, and local taxes may apply.
FINANCIAL IMPACT:
The proposed fees have been added or adjusted to cover the cost of providing services to our
customers.
ATTACHMENTS:
• Proposed - 2024 Utilities Fee Schedule
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