3.1.B. MINUTES 05-10-2011 - Laserfiche WebLink

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Page 2 Regular meeting of the Elk River Municipal Utilities Commission April 12, 2011 4.2 Power Supply Options / Resource Plannine Update In September 2008, Connexus Energy terminated the 10-year rolling "all requirements" power contract with ERMU. In April 2010, the Utilities Commission authorized entering into "Phase 1" of a resource planning study with a coalition which includes Central Minnesota Municipal Power Agency (CMMPA) as a participant. In September 2010, the Utilities Commission authorized entering into "Phase 2" of a resource planning study which includes the release of a Request For Proposal (RFP). The RFP was issued on November 15, 2010. On March 25, 2011, staff participated in a CMMPA webinar for general discussion on the bidders. Troy Adams reported that Peter Beck has spent a lot of time going through the confidentiality contracts. Troy stated he would be attending a meeting on Friday, April 15, 2011, to finalize the confidentiality agreements and select a short list of bidders. No action taken. 5.1 Review and Receive 2010 Financial And Andrew Berg of Abdo, Eick & Meyers presented the 2010 audit. Discussion followed. John Dietz asked Theresa Slominski if ERMU could prepare the audit reports like the City of Elk River currently does, Theresa Slomminski and Andrew Berg said that could be done. John Dietz thanked Theresa Slominski and Lorrie Franz for doing a great job. Daryl Thompson moved to accept and file the 2010 audit. Al Nadeau seconded the motion. Motion carried 3-0. 5.2 Review 2010 Annual Utilities Report Even in these times of economic downturn, Elk River Municipal Utilities (ERMU) continues to grow. In 2010, our purchased energy increased by 6.9%. Based on the most recent data available, ERMU has moved up to now be the 9fi' largest Minnesota municipal electric utility by number of customers and the 12'h largest by energy sales. This growth helps ERMU, our customers, and the residents of the City of Elk River. Because ERMU is tax exempt, ERMU provides to the City of Elk River a fixed percentage of the revenue from Elk River customers' electric sales. This amount is a Payment in Lieu of Taxes (PILOT). In addition to this percentage of revenue, ERMU provides donated electricity for non -enterprise City facilities as well as donated labor. In total, ERMU provided approximately $1,100,000 in 2010. This was up 7.7% over the 2009 PILOT and up 14.9% over 2008. This trend is directly related to the growth of the ERMU. The ERMU PILOT is a significant contribution to the City which indirectly helps to keep City taxes lower. Troy Adams reviewed the 2010 Annual Utilities report. Some of the highlights were discussed. In 2010, ERMU was awarded the System Innovation Award from Minnesota Municipal Utilities Association. The award was presented to ERMU "in recognition for its leadership and innovation in customer service, energy efficiency, renewable energy or technology use, which has improved service to its community and enhanced public power's prestige." Staff implemented the option for credit card payments. The electric department had an increase in sales. Discussion followed regarding the Data