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3.0 OPEN MIC <br /> No one appeared for open mic. <br /> 4.0 OLD BUSINESS <br /> There is no old business. <br /> 5.0 NEW BUSINESS <br /> 5.1 2013 Financial Audit <br /> Andrew Berg was present from the auditing company, Abdo, Eick&Meyers, to present <br /> the 2013 financial audit and management letter. The auditors issued a clean opinion on the <br /> utilities. There were no findings to be reported. The commissioners had a few questions for <br /> Andrew Berg and management, staff responded. Discussion followed. <br /> Al Nadeau made a motion to accept the 2013 Financial Audit.Daryl Thompson seconded <br /> the motion.Motion carried 3-0. <br /> 5.2 2013 Year-End Reserve Balances <br /> The purpose for reserves to a public utility is to meet bond covenants and provide a <br /> financial buffer to mitigate unforeseen or volatile operational costs. In 2010, the commission <br /> adopted a financial reserves policy that defined the structure and formula on how financial <br /> reserves will be calculated for the Electric Utility and Water Utility funds. <br /> As defined by policy, the year-end reserve balances are to be reviewed after the <br /> completion of the audit. These balances, if above their target levels, shall be unrestricted with a <br /> defaulting designation as working capital. The commission shall then consider optimal use of <br /> these unrestricted reserves. <br /> Staff presented the year-end reserve balances and recommended that the balances above <br /> target levels shall be unrestricted and designated as working capital. John Dietz had a few <br /> questions, staff responded. <br /> Daryl Thompson made a motion to approve the balances as unrestricted for the 2013 <br /> audited amounts for 2014. Al Nadeau seconded the motion. Motion carried 3-0. <br /> 5.3 First Quarter Delinquent Items <br /> Theresa Slominski presented the delinquent items for the first quarter. The year to date <br /> balance for collections is about $7,000 and only about $350 is being written off. The American <br /> Public Power Association's national statistics show that the industry standard is between .1 and <br /> .241 percent Uncollectible Accounts per Revenue Dollar. ERMU is well below the standard at <br /> .026 percent. John Dietz asked a few questions. Staff responded. <br /> Page 2 <br /> Regular meeting of the Elk River Municipal Utilities Commission <br /> April 8,2014 <br /> 15 <br />