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03-10-2009 ERMU MINELK RIVER MLIIVICIPAL UTILITIES REGULAR MEETING OF THE UTILITIES COMMISSION HELD AT UTILITIES CONFERENCE ROOM March 10, 2009 Members Present: John Dietz, President; Jerry Gumphrey, Vice Chair; Daryl Thompson, Trustee Staff Present: Vance Zehringer, Interim General Manager; Theresa Slominski, Finance Director/Office Manager; Troy Adams, Engineering Manager; Mark Fuchs, Line Superintendent; David Berg, Water Superintendent; Judy McSpadden, Recording Clerk; Wade Lovelette, Richard Wagner, Michael Price, Shane DeFeyter, Chad Grande, Kim Sandstrom, Lorne Franz, Michelle I,ee Anderson, Richard Cline, Art Gatchell, Peggy Ferguson, Dolores Andreasen Others present: Lori Johnson, City Administrator 1. Call meeting to order March 10, 2009 John Dietz called the March 10, 2009, meeting to order at 4:30 p.m. 2. Consider Utilities Agenda John Dietz added an item to be discussed under Other Business. John Dietz also would like to combine 6.1 into 6.5. Jerry Gumphrey moved to approve the March 10, 2009, amended Utilities Agenda. Daryl Thompson seconded the motion. Motion carried 3-0. 2a. Election of Officers for 2009 At the February 9, 2009, City of Elk River Council meeting, Daryl Thompson was appointed to replace Jerry Takle on the Utilities Commission. At this time Daryl Thompson read the Oath of Office. Jerry Gumphrey moved to nominate John Dietz, President; Daryl Thompson moved to nominate Jerry Gumphrey, Vice Chair. John Dietz seconded the motion. Motion carried 3-0. Page 2 Regular meeting of the Elk River Municipal Utilities Commission March 10, 2009 3. Consider Consent Agenda Jerry Gumphrey moved to approve the Consent Agenda as follows: February Check Register February 24, 2009, Minutes Financial Reports Signature Card Resolution Daryl Thompson seconded the motion. Motion carried 3-0. 5.1 Staff Updates Vance Zehringer reported sales of electricity were up 12% from last year. Water sales for Febniary were down 8.5% from last year, however sales year-to-date are up 2.9% from last year. Vance briefed the Commission on the meeting with Connexus Energy regarding future wholesale power and the relationship with Connexus and GRE. A letter of interest was signed with CMMPA for joining the Big Stone II project. They were notif ed the estimated load ERMU would need would be 30 megawatts. Quotes were recently received for inspecting the integrity of the Jackson Street Water tower. They will be reviewed and a recommendation will be made at the next ERMU commission meeting. Anew group called Citizens Energy Plan (CEP), from Willmar, Minnesota has a goal to present a national energy plan to the US Congress no later than September 2010. Vance wanted to remind the Commissioners that the Energy Expo will be April 18, 2009, at the Twin Lakes Elementary School from 10:00 to 3:00. The HR agreement has been finalized and approved by the City Council. Theresa Slominski updated Commission on the CAPX2020 and MMTG contributions. The auditors were here last week. There are still some things to be finished. The financials for the next ERMU Commission meeting will be January and February. David Berg said staff is in the process of cleaning the tanks at Well #2 and Well #3, prepping them for repainting. The MN Department of Health has responded that the yearly water quality report has to be mailed to the customers address and cannot be put in the City newsletter. Some samples will be provided for selection of the format to use for this years report to consumers. The Water Conservation Clinic will be held March 28, 2009, at City Hall from 8:30 to 1:00. Mark Fuchs reported staff continues with tree trimming, cutout replacement, fuse coordination, and testing generators at the plant. A crew is working on installing a new service for Aggregate Industries. It was recently discovered that the paging system is not working properly. Staff has been working with Sherburne County to correct this problem. At the last ERMU Commission meeting it was stated that there might be a possibility of ERMU joining in on the City's fuel contract. This was not allowed by the fuel contractor, we instead had to have our own contract which was slightly more but still a good price. Page 3 Regular meeting of the Elk River Municipal Utilities Commission March 10, 2009 Troy Adams reported 12 security system sales for the month of February. Locates are still low so staff has been assisting with the tree trimming and utilizing the new thermal imaging camera to find trouble spots. Recently there was a MN Pollution Control seminar on PCB handling and record keeping. Mike Thiry did a good job organizing. The Business Expo will be held March 29, 2009 at the High School. 5.2 Consider Water Tower Antenna Policy Elk River Municipal Utilities (ERMU) has previously not had a Water Antenna Policy. A policy statement regarding the use of Utility owned land for communication antennas and towers was reviewed. John Dietz requested a time frame be stated in Section 3 part 5 for removal instead of the wording, reasonable notice. Also, in Section 6 part 1 of the policy there should be a time frame for notification and compensation for the term of the contract. Daryl Thompson agreed. Staff was directed to make the changes and bring back to the next ERMU Commission meeting for approval. 5.3 Consider Met Council Contract for Antenna on Gary Street Water Tower At the February 24, 2009, ERMU Commission meeting the Met Council contract was discussed. Attorney Peter Beck recommended changes be made to the contract, Commissioners agreed. The revised contract was presented for approval. Vance Zehringer read a letter form Attorney Ron Black regarding three issues found in the revised site lease agreement from Met Council that he felt should be revised. One issue was regarding where the responsibility would be if someone got hurt on the tower. Lori Johnson was asked if the City of Elk River would get sued if someone was hurt. She responded yes, even if the wording was changed there could still be a lawsuit. John Dietz recommends signing the contract. Jerry Gumphrey felt Commission should take the advice of the attorney and renegotiate. Daryl Thompson said this contract is in the best interest of the public. Daryl Thompson moved to approve the Met Council contract as is. John Dietz seconded the motion. Motion carried 2-1. Jerry Gumphrey opposed. 5.4 Consider Changes in Water Shutoff Policy The City Ordinance governing discontinuance of water service was presented and adopted at the March 2, 2009, Elk River City Council meeting. The ERMU Policy and Procedures for Water Shutoffs has been amended to reflect the changes specified in the City Ordinance. Additional changes may be made at the March 17~' meeting with Attorney Peter Beck so a final water shutoff policy will be presented for Commission approval at the April ERMU Commission meeting. John Dietz asked if the letters have been sent to the customers Page 4 Regular meeting of the Elk River Municipal Utilities Commission March 10, 2009 regarding changing out their water meters, Dave affirmed. David Berg asked about televising water restrictions. Consensus was this would be a good idea. David was directed. to talk to the City's media department regarding this. 5.5 Consider Application to MN Dept of Health Regarding Water Main from Well #9 to Well #7 At the February 24, 2009, ERMU Commission meeting, a stimulus loan was discussed. Staff was directed to apply fora 30 year loan of $350,000 to construct a new water main from Well #9 to Well #7. The application to MN Department of Health for the Drinking Water Revolving Fund was reviewed. 6.2 Review List of Sewer Customers that have not Connected to Water Commissioner John Dietz requested a list of customers who are connected to City sewer but are not connected to City water. Elk River Municipal Utilities rules require residential units connect to city water services within 2 years of the date the service is available. There are currently 45 customers throughout the City that are connected to City sewer but not City water, 61 customers that are hooked up to City water but not City sewer, and 100 customers that have not connected to either even though the services are available. Discussion followed regarding the possibility of assessing it to the property. John Dietz said he would like the City Council to address this issue. Lori Johnson said it could be discussed at a future work session. John Dietz said if it is mandatory to connect to the City's sewer and water then they should be assessed. Consensus was to check into noting this on the abstract to connect prior to sale of home. The City Council could levee assessments to the property. 6.3 Review 2009 Capitol Equipment Purchases At the last ERMU Commission meeting, staff was directed to recommend a dollar amount threshold for future budgeted purchases that would need Commissioner's approval. The current policy states non-budgeted items over $10,000 need Commissioners approval. Staffrecommends using that same threshold for budgeted purchases in 2009 but asks for re- evaluation for purchases in 2010. Jerry Gumphrey moved to approve $10,000 as the threshold of future budgeted purchases to be brought to the commission for approval. Daryl Thompson seconded the motion. Motion carried 3-0. Page 5 Regular meeting of the Elk River Municipal Utilities Commission March 10, 2009 6.4 Review 2009 Construction Projects The spring thaw is quickly approaching and with that begins the 2009 construction season. Staff is currently prioritizing, designing, and planning for the 2009 capital projects. At the February ERMU Commission meeting staff was directed to bring back for review a list of the 2009 electrical distribution. capital projects. The list presented was discussed. Because of the current stock and the highest priority projects, it was estimated that a minimal amount of wire was needed at this time. Staff has secured quotes for this wire and is asking for approval to purchase at this time. Jerry Gumphrey moved to approve purchase of necessary materials for the top five high prioritized projects. Daryl Thompson seconded the motion. Motion carried 3-0. 6.5 Consider Staff Recommendations Pertainin to 36 Hour Work Week At the February 24, 2009, ERMU Commission. meeting, John Dietz brought up the subject of implementing a 36 hour work week for all ERMU employees and directed staffto look into the possibility. Mark Fuchs stated that a lot of the electric work previously contracted out has been taken back in house. Vance Zehringer stated if the new data center chooses to come to Elk River, even a 40 hour work week would be tough. John Dietz listed other options that could be implemented to reduce labor and benefit cost in place of a 36 hour work week. Daryl Thompson asked if staff had been given the opportunity to reduce costs prior to looking into labor cost reduction, staff responded no. Daryl Thompson recommended staffhave the opportunity to come back with ideas. Jerry Gumphrey felt a close eye should be kept on the fmancials as he is notvi favor of cutting back staff at this time. Troy Adams thanked the Commissioners for giving staff an opportunity to address these economic concerns through other options than just labor. John Dietz directed staffto come back at the next meeting with some ideas. 6.1 Consider Wage Survey Inquiries Staffwas directed to do a wage survey similar to what was done last year and present the results at the next ERMU Commission meeting. Other Business John Dietz stated that a question was raised at the last Commission meeting about the posting policy and the reorganization occurring at the Utilities. John Dietz read the following statement. Please understand that reorganization is not a normal occurrence. While it did necessitate moving employees, it did not create job vacancies in the ordinary sense. The Commission determined that it had to move certain employees to facilitate a quick and orderly Page 6 Regular meeting of the Elk River Municipal Utilities Commission March 10, 2009 reorganization. Despite this, the Commission affirms its policy on position postings as normal vacancies occur at the Utilities. Jerry Gumphrey said if all Commissioners are present at the upcoming events, a quorum should be noted. These events are the Water Conservation workshop to beheld at City Hall on March 28, the Business Expo at the Elk River High School on March 29th, and the Energy Expo at Twin Lakes School on April 18th. The next regularly scheduled meeting of the Elk River Municipal Utilities Commission will be Tuesday, April 14, 2009, at 4:30 p.m. President John Dietz adjourned the regular meeting of the Elk River Municipal Utilities Commission at 6:30 p.m. Minutes prepared by Judy McSpadden. I J Di tz esident, E ommission Tina Allard City Clerk