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Commissioner Stewart's request, Mr. Berg shared that after working with staff it was determined that all of the amortization should be classified under power supply as a part of the Minnesota Municipal Power Agency buy-in, while the majority of depreciation moved to distribution. Mr. Berg explained that this clarification improved the cost of service results by reducing the subsidization across customer classifications. Mr. Berg thanked Commissioner Stewart for her astute review of the information. Mr. Berg also noted that differences between the allocated cost to serve and revenues for all four classes of customers is less than 5%, which is a very reasonable result in a cost of service analysis. Mr. Berg presented the existing and proposed rates as outlined in Exhibit 4-A. Mr. Berg pointed out that with ERMU's electric rate decrease of 5% in 2019, and a 0% increase in 2020, his recommended 1.5% increase each year from 2021-2024 would result in a 1% overall total change in electric rates from 2018 to 2024. Commissioner Stewart asked if staff would have access to the spreadsheets for future analysis. Mr. Berg responded that it is not standard practice to do so and explained the reasoning behind it. He stated that he would be more than willing work with staff to adjust elements of the study should circumstances change that would warrant doing so. Moved by Commissioner Stewart and seconded by Commissioner Westgaard to receive the Electric and Water Cost of Service and Rate Design Study Final Reports. Motion carried 5-0. 5.3 Leadership Transition—Search Committee Update Ms. Englund returned, after appearing before the commission in May, to provide an update on the status of the leadership search and selection process. Ms. Englund provided an update to the commission and noted that based on the quantity and quality of applications received to date, the search process would now be shifting to a passive recruitment model. This involves gathering contact information for key individuals and organizations, emailing them a letter announcing our search process, and inviting them to apply for the position or share the posting with others that may be interested. Ms. Englund also noted there seems to be a misunderstanding of the term "General Manager" amongst applicants. Ms. Englund requested that the posting add the clarification that this a chief executive position. After discussion, there was commission consensus that for the purpose of advertising for the position opening, the title of "General Manager (CEO)" could be used. Chair Dietz stated he was made aware of questions about the pay range for the position. Ms. Slominski responded that although it wasn't included in the job posting, there is an established pay range for this position that could be shared to help in the recruitment Elk River Municipal Utilities Commission Meeting Minutes June 9, 2020 Page 3