4.3 ERMUSR 04-10-2018 - Laserfiche WebLink

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Elk River Municipal Utilities UTILITIES COMMISSION MEETING TO: FROM: ERMU Commission Theresa Slominski—Finance & Office Manager MEETING DATE: AGENDA ITEM NUMBER: April 10, 2018 4.3 SUBJECT: 2017 Utilities Performance Incentive Compensation Distribution ACTION REQUESTED: Award the Performance Metrics and Compensation Distribution of 1.9%to qualifying employees per the terms of the policy. BACKGROUND: The Commission adopted a Performance Metrics program in December 2012, for implementation January 1, 2013, and revised October 11, 2016. This program was based on the American Public Power Association's Reliable Public Power Provider(RP3)program with the addition of financial goals. As defined by policy, this company performance based program is designed to incentivize employee commitment towards the company's success. "The successful performance of ERMU is measured in terms of the Utilities'ability to meet our strategic goals and mission. By improving our efficiency and level of performance in meeting our strategic goals and mission we can improve the delivery of value to our customers. " Divided into categories representing core values of the company and again into sub-categories that are quantifiable,this program is designed to track goals that require companywide support of the employees to continually achieve. When the employees work together as a team to achieve these goals,the company recognizes a corresponding increase in value to our customers. DISCUSSION: The performance metrics were monitored and provided as updates to the employees and commission on a quarterly basis throughout the year. This allowed for corrective action to be taken in order to meet the targets for the program. The program works exactly as intended as we witness employee motivation and efforts align to improve company performance for deficient criteria. We present to the commission the finalized results of the score card on which the employees have successfully achieved all of the company performance metrics targets, except for one (the Water Loss metric). Per the policy, a multiplier of 95%would be used and qualifying employees would be eligible for a 1.9% distribution. FINANCIAL IMPACT: Budgeted item. ATTACHMENTS: • ERMU Policy-P.13 -Performance Metrics and Incentive Compensation Policy • ERMU Performance Metrics and Incentive Compensation Policy Score Card-2017 Page 1 of 1 134