11-14-2017 ERMU MIN - Laserfiche WebLink

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The Commission had a few questions and also wanted to know how the billing change would be communicated to customers. Staff responded. Moved by Commissioner Stewart and seconded by Commissioner Nadeau to approve the revised Service Policies. Motion carried 4-0. 5.0 BUSINESS ACTION 5.1 Financial Report—September 2017 Ms. Slominski presented the September 2017 financial report. For the Electric Department, she cautioned the Commission from comparing the net income from this September to the prior year's September as the income from the sale of the Security Department skews the comparison. She added that the important thing to note is that we are ahead of the budgeted YTD Net Income. Chair Dietz asked for further clarification on what the cause was for the disparity between sales and the power bill. Staff responded. Commissioner Stewart asked where we were at year to date with power cost adjustments (PCAs). Staff responded that the year to date accumulated PCA charges totaled roughly$150,000;the accumulated total included the month of October. Moved by Commissioner Thompson and seconded by Commissioner Stewart to receive and file the September 2017 Financial Report. Motion carried 4-0. 5.2 2018 Business Plan/Budget: Rates and Review Mr. Adams presented the preliminary balanced budget and electric and water rates. Mr. Adams noted that the initial ERMU 2018 retail electric rates outlook is very favorable for our customers. Provided was a worksheet illustrating a proposed rate impact study for ERMU's different retail rate classes with hypothetical customers' usage. All examples indicated an impact of approximately 1%or less, equating to a $14.00 annual increase for a typical residential customer. As staff still has further considerations to be finalized in December with the MMPA analysis and COLA decision,the finalized 2018 retail electric rates will be proposed for approval with the 2018 budget in December. There was discussion on the $1.00 per kW temporary demand credit that would be going away in 2018 and how those customers would be impacted. In order to maintain the financial health and to plan for the short and long term water capital project projections,the 2018 water budget reflects an overall 1.3% increase in revenue through water sales. Mr. Adams shared that the allocation of the increase will be collected through an increase in customer charge and 1St tier water use rates. Provided was a worksheet illustrating a proposed rate impact study for ERMU's residential water rate. The result for the proposed rate increase for a typical residential customer would be1.85%,resulting in an approximate annual increase of$5.00. The finalized 2018 retail water rates will be proposed for approval Page 3 Regular Meeting of the Elk River Municipal Utilities Commission November 14,2017