5.1. ERMUSR 12-09-2008Elk River
Municipal Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
Dec 4, 2008
To: Elk River Municipal Utility Commission
Jerry Takle
John Dietz
Jerry Gumphrey
From: Vance Zehringer
Subject: Dec 4 Meeting Results, United Health Group Management Team
Phone: 763.441.2020
Fax: 763.441.8099
The subject meeting was initiated by yours truly to alert UHG about load spikes created
by integrity testing they initiated and the impact those tests had on their power bill and
possibly ERMU's billing peaks. They were more than eager to meet and discuss that and
learn about other things they can do to reduce their monthly bills.
The one month in question was July 2008. Seven megawatt spikes during the last week
of that month were a result of testing they were conducting to determine system integrity.
Those tests added $104,000 to their July bill for the additional demand they placed on the
system. They missed ERMU's 7 PM July 28 billing peak by two hours, because we
asked them to run their generators so we dodged a huge penalty on our monthly power
bill from GRE.
The other month in question was November 2008. A single 2 megawatt spike occurred
on Nov 20 at 10 AM for 1.5 hours during an otherwise level monthly load. That 2
megawatt system integrity test added another $21,000 to their November bill for the
additional demand they placed on our system. Our billing peak was also on Nov 20, but
at 7 PM, so we dodged a significant penalty on our monthly power bill from GRE.
The point is, if either of these tests had occurred a few hours earlier or later, ERMU
would have incurred significant additional demand casts from GRE.
UHG is willing to shift any additional testing of a like nature to off-peak hours and even
give us advance warning prior to testing. The question is what's in it for them?
We recommend ignoring any integrity testing spikes created during the off-peak hours
(between midnight and 6 AM) for billing purposes. In order to not set a precedent, we
would make this offer to any new or expanding lazge commercial loads exceeding one
megawatt if testing occurs only during off-peak hours, if it is for system integrity testing
purposes only, if they give us a 24 hour "heads up", and only during that duration of time
when they are ramping up to their full anticipated load.
s ^
~ 'n er ette
FORECASTS FOR MANAGEMENT DECISIONMAKING
1729 H St. NW, Washington, DC 20006-3938 ~ kiplingerbiz.com ~ Vol. 85, No. 48
Dear Client:
As the recession pushes joblessness to 9%...
Big Labor is bracing for huge job losses.
But the political climate is the best in years,
and union leaders have an ambitious agenda to press.
.: A sympathetic president is taking office.
'' And Democrats hold large majorities
in both houses of Congress, thanks in part to help
and money provided by unions all over the country.
The big prize is card-check legislation...
a bid to make it much easier for unions to organize.
It's amust-have change for leaders of organized labor,
which now claims only 12% of employees as members.
The bill would require employers to recognize a union
if a majority of its workforce signed cards. Toda_y's law
requires amonths-long effort ending in a secret vote.
Unions say that gives firms time to pressure workers.
Firms say card-check lets unions strong-arm workers.
An overlooked clause also hurts companies.
It requires binding_arbitration if a company
and a new union can't reach a pact in four months.
business is gearing up for a Huge iignt.
And pap ssage of card-check is no sure thing,
despite pledges of support from President-elect Obama and Democratic leaders.
The U.S. Chamber of Commerce has $30 million to woo the public and Congress.
Some conservative Democratic senators may well side with the GOP and business.
Compromise is the likely outcome...perhaps aplan to expedite elections
while preserving the secret ballot, which business groups are unwilling to give up.
Working in businesses' favor: Obama would rather put off a showdown.
He has other, more pressing priorities, and he won't want to send any early signals
that he's antibusiness or that he's a pushover for labor and other special interests.
That will give businesses more time to win over the public and wavering senators.
But it won't be delayed more than a _year, and labor holds the better hand.
Other issues on labor's agenda will be approved much more quickly:
Paid sick leave. Expect passage in 2008 of a bill requiring employers
to provide at least seven days of sick leave. 40% of workers have no sick leave now.
Pay equity. Obama promised...and v~~ill deliver...early action on legislation
to reverse a Supreme Court ruling limiting the right to file pay discrimination suits.
Ergonomics. Obama will resurrect a Clinton administration regulation
designed to reduce repetitive motion injuries that was overturned by Republicans
in 2001. At the time, employers said it would cost $100 billion a year to implement.
FMLA. A proposed expansion of the Family and Medical Leave Act is iffier.
Unions want it to cover small firms and apply to things such as school conferences.
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Washington, Nov. 26, 2008
Willa $500-billion-plus stimulus plan mull the economy out of recession?
° It'll help, but only if i.t has the right mix of short-term and sustained. fixes.
Obama is already moving to win. r_ongressional passage of a plan of that magnitude.
He wants it ready for his signature immediately after he's sworn in on Jan. 20.
For a quick boost, the plan will deliver tax cuts to most American workers,
including a payroll tax holiday, by adjusting withholding rates in lieu of tax rebates.
Loner term...hundreds of billions in infrastructure spendin„ investments
in alternative energy and grants to states for rising Medicaid and social service costs..
Obama also ~~ants federal assistance far distressed homeowners facing foreclosure.
To win Republican support. Obama is willing to postpone tax increases
on couples making over $250,000 until the Bush tax cu*s expire on Jan. 1, 2011,
t~s~"rl<-"yc~i~i rZs:eitt~te 'tl~e auc. a~a 1: ~~ 1- i q~3o zn 1e.o.~l-1 a ~tii S ~ ve:rir~,
~ ~;i~~r~~'t~~~e-1's t~f url~mpl7syirieiii: a~.it ~clirte~, ili ;Coss cd~~i3ae5t~c paJoc~ixc4+.
Buz a,~icire.uirl~islz~:txs aticl~:~e:~ioris'wi:li-bi ai#'ee-i~i~1~-fit.
_. -
~ - ~ - - ~ ~`he c'arrenfi~~iys~nt:z~.riz will cost jdb ~ fi-em co;~st.;fig ~:it
Job Losses in 1982 and 2009 1~ e'c er~y field' ffom ff_ffanclal servtcns to__FLigYI tc.phll.olp~y.
o% 296 aab cab aab loop ,~~ ~ "~~3'~?'~~S.~f"i~.,~~'LUPi1'~~iL rc=%Zs~Sir~3~zil t~ "~$C.~'s,
Total nonfarm V~'.hl°Yl'iZt~C.~i~T'32~'g .b07•t: t~Ie .~7~i:lilt U'1• t.l1e 'L.11`l;~?c(~f,.
''"" ' `~~ Construction I - •- °- - - -i
~~:.~.,~_~.~~._.. =i~~ar~~.~~hrx~zn.:~s~:~ves~.tit wtli.~azt~-t h~~l~ ~l~cl,
_:?~ Manufaeturlnq e~s~iecialiy iZi Silu.oi~:~al~ey>..Bas~ian acrd R~le'.igh,'N:~.
61982 1~1>a~~;~al~s~FVice vies w111 iliril:in:~'e #~1p~aaiads oT-jobS
Service ~ 2009 FORECAST ]~'1~.'~.,. 1~~~021, 011arlotte, l~1 ~.`., ,~rl~~ ua~i~~~:2tn~C15Q~09.
'' ~~1.g.~N~~zoise foi>1_ob #luriters: TY~.e..`lusll~~crisi~.
~' Finance/banking _`(~ _7r (~ _ t~y7 „1
Sources: De t. of Labor, Kiplin er ~~"°'~~w~33..t~G~s- ~n th~5 ~r~L es Si~l~ ~~C7'^ °°~.~'~" f~ ~~e' J ~h~'~i~t
_.
t~ l~ ~Teia~'l~~sme~„mod' izyavt; ~'tc~ anl~ther p~ace'~ fo-i- ~ j4by.
Among those watching as the stimulus takes shape: Airport managers.
Dozens of airport proiects are at risk because of frozen credit markets.
Portland, Maine, for example, is delaying plans for an airport terminal expansion,
and Nashville, Tenn., has put plans for a consolidated car rental facility on hold.
Bonds usually provide about 60% of financing, with the rest from the government.
~~~; .l~irms :axe clou~ns'.lzi.n~ ~rapdiy lyIor~ t~,an .13fl, 000 big :rg~ .. .
over 7°I'oc: have: b~eia.pull~ci o~Ethe.roaii.a_lread~y;.-anel the figure w%ll.:keep~grow.i.~g
.._ ,
as the,recessf~n iakea a to:>:1, lylany firmms vcrill be.fol-ced aut aT-business e~ti~rr.
That will be a huge headache for shippers when the economy recovers.
Demand will ramp up faster than capacity, so rates for moving freight will spike.
Figure on paying about 10% more when the economic recovery is in full swing.
Consider locking in a rate now. Offer to guarantee a minimum level.
of business in exchange for guaranteed service and limited price hikes.
One industry that's booming in the recession: Videoconferencin~.
More firms are turning to "virtual" meetings to save the cost of time and travel.
Workers like that better, and videoconferences let firms reduce their carbon footprints.
Technology and cost run the gamut. On the low end are desktop setups
that amount to little more than a digital camera and a computer. High-end products
from Cisco Systems, Hewlett-Packard, Microsoft and others cost up to $300,000.
A cheaper option is renting space at videoconference centers for under $500 an hour.
'ai'di4~es ~ti~rt more ~crliite~v'llar crime. ~Nomral~~y lbw-abidirxg em;ploye.e~
~...~- _
e to-,aECess .a.fki'.ixl~'s~.privilege~l,rnfori~aat~on rn~y-he ~ wiil.ing to-ris:k jail ti~m~e
... ...
__. ~ _, •
ii'~h~ey're v~orried a~au#,urxemgla~mexi~t. Be ~~i fl'i'e.al~rt;~to~;:;for'>rrerl_it c~:>•ii~ fraud;
~b~~ute~r h~~kers diming "#o s~eaI-irite,lYectal 'property. ar'e also a big th,re~lt.
Remember, your subscription includes The Kiplinger Letter online
U.S. automakers are too big to fail, but they're also too big, to succeed.
So Congress will help, but the price will be restructuring and downsizing.
Lawmakers will come to Detrait's aid with loan guarantees of at least $25 billion.
That will let General Motors, Ford and Chrysler survive awhile longer.
Look far action. by late January, perhaps as part of the Obama stimulus plan.
~eax-fray-n nr~w._:2.5°n:i'~-c~mar,b.l~.~:.:niltar~attosvQ~ke~s.~a~;Loss;0~.5:0Ofl0
.. __ .
i~n..the industry-.~..a s-tti~~ning_fs40,C~C~O~lost if you acl~ ~n,siippli~rs-anei othPr~s
who ~i~l ~e affected. An•d ~ti:li mare job cL~ts°a~re .likely further down the ro`~cl,,:
_. _ ..
LZp. to,~^#h~~d o~ the 5:8 auto planks r_I?at dot the' Mdvtrest w~i2l be s~3~ritt~red
The United Auto Workers union will have to swallow big cuts in pay
and benefits, with more workers shunted to the tiered system created in 2007.
That means wages and benefits totaling $25 an hour, which. is what Toyota
and Hcnda pay U.S. workers, rather than the $75 an hour mast get now.
And expect an end to the system that pays idled workers 95% of their wages.
Bid changes, too, in the sizes and kinds of cars produced by Detroit.
GM will put Chevy Volt's plug-in hybrid technology in many more models
within five years. Also, a turbocharged, fuel efficient Chevy Cruze in two years.
Ford will :-oll out the hybrid Fusion, which is touted as more efficient
than Toyota's Camry, and in 2010 unveil a Fiesta that gets 40 mpg on highways.
And Chrysler will sell ahigh-mileage subcompact from Nissan in 2010
but has nothing else in the works...one reason the company may be sold off.
Expect a third fewer mergers and acquisitions next year, a direct result
' of tight credit, bankruptcies and volatile equity markets. The value
of M&A activity will also drop a third, from $3 trillion in 2008 to $2 trillion in 2009.
The bulk of the combinations will be among midsize companies
with revenue between $50 million and $500 million a year. With more bankruptcies,
fewer businesses will need to buy up their competitors to thin out the ranks.
More firms will combine with complementary partners to improve efficiency...
office equipment distributors teaming up with office equipment makers, for example,
or software makers being bought out by the electronics companies they supply.
k~v~i.'t~ah,:but.'Ysub~~h~es";~are-real acrd theyoa~a: hip cut pollut~ori,~
l~xp~c`t~~rrris ~o plant inore.eci~logieally Erie-n~d7y varieties of gapla~, b,~eec~+h
~n.cl:-_p~R9;haf; ,nth. genetic tweaks, eats 25~~o-h2~ore-car~ori~ cTic~x~ f:b~t?:to~d~y's..trees.
The supertrees reach harvest-ready maturity 40~% faster than regular trees-
That will help to rev up the production of biofuels, such as cellulosic ethanol,
which can be distilled from wood pulp and sawdust, and which will be in demand.
The forest industry also gains from the quick growth of the supertrees,
and furniture makers will benefit because the harvested wood is nearly blemish free.
T'hert ~hete ~az`~ -<`e.1eGtri~" trees.. Scxe:xttrsts ca.n n~vv harvest°p~v~r-:froan-trees,
. pp g ... .g. ~ - . ~ ..t. ~
tea in the ,bark.fa~:a loi~i-volta - e~ ch~r~ _ ~~ hardly a sna .os :er:~e~ ~ : source, bit...
it's ~eno~agh to sxigply smail.f~~tter.L}~ciwered sensats :ori the tr~~'s!
The sensors will provide invaluable soil and weather information to growers.
They warn of moisture and humidity problems and of disease-causing conditions.
They'll also be of use to forest rangers. The sensors point to dry areas
that might be susceptible to fire and provide early notice when a blaze does start.
')xl~t~ sta~~da~d h2.S rata :fa:r btXsltt'e;~s cln~rii%g-tiuil:L fall :to.:a5~ p~t~ taaile ~n 2Q0:g,
from 58.5 this year. The rate for medical travel will drop 3~, to 24~ a mile
next year, while the deduction for travel for charitable work remains at just 14~.
For instant online access and searchable archives, go to kiplingerbiz.com/start ~•~;.^`~,
~ ~ ~ The global food crisis is deepening. Tighter credit is crippling farmers,
' ~ ' especially in developing nations; making it hard. for them to purchase seed,
fertilizer and fuel or invest to boost production. The dollar's appreciation also hurts,
making greenback-denominated age icultural products expensive to import.
That more than offsets the falling price of oil, which lowers transportation costs.
The shock will hit in the s rin ,with weak Southern Hemisphere harvests.
And industrialized nations won't be able to provide much in the way of fresh relief.
The risk of political instability will increase. Expect food riots in some parts
of the Middle East, Africa, Latin America and Asia...including even China.
The changes at American Express will hurt its small business customers.
Trie firm is cutting staff by 10% after profits fell by 23% in the third quarter
compared with the same period last year. The company is also transforming itself
into a bank holding company so it can qualify for government rescue programs..
Smalls face higher charges and less service as a result of the cutbacks.
Fees and interest rates will rise 2 to 3 percentage oints in coming months.
At the same time, smalls can look for a slew of new products as American Express
moves to build up banking services as part of its new look. Expect the company
to invest in online banking for small businesses, which make up 20% of customers.
With lending to smalls fallir~g~ off a cliff the government is moving to help.
But that will mean higher interest. The Small Business Administration
is now letting lenders in its 7(a) guaranty program offer loans at 300 basis points
above the one-month LIBOR, the global bank lending rate, in addition to the prime.
That will mean 4.4% instead of 4% at today's rate, making the loans to smalls
more profitable, an incentive to thaw frozen credit spigots. In the first six weeks
of fiscal 2009, the number of loans in the program dropped 55% over last year.
Small U.S. exporters may soon get an assist from the Export-Import Bank.
The bank will make more loans to foreign buyers to help finance purchases
from U.S. exporters. Also available: Lower premiums on export credit insurance
and relaxed rules on credit lines for indirect exports, goods used to make exports.
A surge of violence in Afghanistan will likely greet the Obama team.
' ' ' A presidential election is due to take place sometime in 2009. The Taliban
and antigovernment warlords are expected to use the occasion to stir up trouble.
President Hamid Karzai is weak and unpopular, but there is no viable alternative.
Obama wants to send additional U.S. troops and more from NATO too.
But Germany, Italy and other leading members of NATO will go only so far
to accommodate the new president, no matter how much they want good U.S. ties.
U.S.-Pakistani cooperation against the Taliban and al Oaeda is improving.
Pakistani President Asif Ali Zardari and Army Chief of Staff General Ashfaq Kayani
are rapidly revamping the military to fight militants along the Afghan border.
But further progress will require d plomacy and economic assistance.
Pakistanis still distrust the U.S. for its support of ex-President Pervez Musharraf.
Islamabad is also in bad financial shape because of the credit crunch and recession.
Your very t ,
~.
Nov. 26, 2008 THE LINGE W ING N EDITORS
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