4.2. ERMUSR 12-14-2010 - Laserfiche WebLink

Home Browse Search

Minnesota municipal that also awazds an annual bonus which is based on employee performance evaluation. The biggest vaziation in benefits between these utilities comes in the health insurance provided. This also is a very difficult benefit to compaze value and not dollars. The insurance plan that ERMU provides has one of the highest premiums of the utilities in the survey. Of the municipal utilities in the survey that provided information, ERMU is the second highest. Compared to the two cooperatives that provided premium information, ERMU is in the middle. The value of having a more robust health plan with high premiums is hazder to compare. Many of the utilities have or are in the process of transitioning to high deductable/low premium health plans with healthcare savings accounts. These plans are difficult to compare duectly to the co-pay type plans. This comparison may be premature because of the current healthcare reform and uncertainty in the future of healthcare. In a very general compazison, ERMU offers a very good health insurance plan which comes at a cost [o the company. This cost is not the highest of the cooperatives or municipal utilities in the survey, but is neaz the top. The wage increase numbers used in November for the metro average comparison appeaz to be good. One of the cooperatives had not finalized their contract, but felt comfortable with the number staff had used in the comparison. So as noted in November, the percent change in the metro average wage from 2010 to 2011 has an increase of 2.03%. This is the increase that would be required to not lose ground with the metro average, but also not gain ground. An increase of 6.13% would be required to achieve the metro average wage for the lineman position. As provided in November, the Consumer Price Index is 2.33%. For sake of compazison, excluding the cooperative utilities and only analysis the municipal utilities in this metro survey would result in an approximate 2% increase to achieve the average of these metro municipal utilities. The additional analysis that has been done comparing municipal utilities from the metro and those out-state is attached for commission review. This survey indicates that to meet the average of these municipal utilities, a 0.263% increase would be needed. Elk River Municipal Utilities is not a cooperative. And although municipal utilities and cooperatives are both public power and have the same mission, there are differences because of our governance. Elk River Municipal Utilities is more similar to a metro utility that anout-state utility. The metro average survey has served ERMU well for over two decades as a tool used to establish wage increases. This does not imply that the state wide survey isn't relevant. Both surveys offer different view and can both be used as tools for making an informed decision. There is some warranted discussion on difference and separation in governance between a municipal utility and their City. The labor pool for the utilities is different from that of law enforcement, fire, streets, and administration. This makes it difficult to apply the same logic uniformly. It should be recognized that even though a municipal utility is government, the provisions of state statue aze applied such that the municipal utilities aze meant to be operated as a business. As provided by state statue and bylaw, setting of compensation should be given sepazate consideration. Of those metro municipal utilities surveyed, half are handling wage increases differently than their City. ACTION REQUESTED: Management recommends awarding the 2.03% wage increase needed to not lose ground with the metro average. Management also recommends approving a plan to reestablish the metro average in the future. As submitted in November, committing to a 1.03% adder will reestablish the metro average in 4 years. This scenario would result in an increase of 3.06% for 2011. Management recommends adopting the proposed storm pay policy contingent upon legal review of the language.