05-12-2020 ERMU MIN - Laserfiche WebLink

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5.2 2020 First Quarter Delinquent Items Ms. Karpinski presented the delinquent items for the first quarter, including a delinquent amounts report totaling $2,707.86 for all services. She also presented the delinquent items comparisons for 2017 — 2020. Ms. Karpinski noted that our percentage of uncollectible accounts, at .029% per revenue dollar, is well below the national average which is between .17% and .40%. Chair Dietz asked if there was an increase in the number of customers delinquencies due to COVID-19. Ms. Nelson responded that payment arrangement calls have decreased significantly. She added that the Credit & Collections Specialist has stayed in contact with customers to ensure they understand the changes to energy assistance guidelines. Moved by Commissioner Nadeau and seconded by Commissioner Bell to approve the 2020 First Quarter Delinquent Items. Motion carried 5-0. 5.3 Electric and Water Cost of Service and Rate Design Study ERMU staff has been working with Dave Berg Consulting, LLC on an electric and water cost of service and rate design study. The work was done to evaluate possible changes to the electric and water retail rates and applicable fees. Staff evaluated changes in operating conditions, including but not limited to: monthly fixed costs, additional service fees, bonding for the new field services building, and retail energy and water rates. Mr. Berg was at the meeting to present the draft reports and answer any questions the commission may have. Mr. Berg walked the commission through the high points of the Water Cost of Service and Rate Design Study draft report which included: Projected Operating Results with Existing Rates, Cost of Service, and Proposed Rates. For the Projected Operating Results with Existing Rates Section in the water report Chair Dietz asked why the study utilized flat operating revenue for the utilities from 2020 to 2024. Mr. Berg explained that by using flat water and electric sales for the study period it helps creates a conservative baseline for staff to work with. Commissioner Stewart inquired if the capital improvement data had been updated based on any new information on the Highway 169 Redefine project. Mr. Adams responded that ERMU has not received final plans for the project. Ms. Slominski added that these are the best estimates based on the information available at this time. For the Cost of Service Section in the water report Mr. Berg noted that when comparing residential water customers to commercial/industrial water customers, the respective costs of service closely matched the percentage of revenue. Based on the overall revenue and cash reserve needs of the water department, and the results of the cost of service analysis, Mr. Berg did not recommend a change in water rates, however he did Elk River Municipal Utilities Commission Meeting Minutes May 12, 2020 Page 4