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Ji <br />Elk River amft . <br />Municipal Utilities UTILITIES COMMISSION MEETING <br />TO: <br />FROM: <br />ERMU Commission <br />Mark Hanson —General Manager <br />MEETING DATE: <br />AGENDA ITEM NUMBER: <br />June 4, 2024 <br />5.5 <br />SUBJECT: <br />2024 Compensation Study <br />ACTION REQUESTED: <br />Receive and Approve the Baker Tilly's 2024 Compensation Study. <br />BACKGROUND: <br />At the December 2023 commission meeting, the Commission approved entering into a <br />professional service agreement with Baker Tilly to complete a company -wide compensation <br />study. After review by the respective managers, human resources, and the general manager, all <br />35 job descriptions currently on file have been submitted to Baker Tilly. In February 2024, the <br />Commission approved the ten peer utilities to be used as comparable utilities for purposes of <br />gathering compensation information. <br />Baker Tilly recommended the ten competitive peer utilities based on labor market competition, <br />population served, cost of living, and cost of labor. The ten peers were: Anoka, Austin, Chaska, <br />Connexus, Great River Energy, Moorhead, North St. Paul, Owatonna, Shakopee, and Wright - <br />Hennepin Electric. Three private sector databases were also used to represent the private <br />sector: CompAnalyst, Economic Research Institute, and PayFactors. <br />DISCUSSION: <br />A custom market survey was distributed to each of the recommended peer organizations <br />requesting base pay ranges for analogous positions. The survey included a minimum <br />qualification and a summary of work performed by each position to assist in matching position <br />titles with their responsibilities. All ten peers completed the survey and submitted responses to <br />Baker Tilly directly. <br />Using the surveyed data, Baker Tilly reviewed and validated survey responses to confirm a 75% <br />overlap in duties and responsibilities. A 75% overlap is the industry best practice definition for a <br />"good" match. Baker Tilly confirmed all our positions had sufficient data to proceed with <br />confidence. Our average was 6.3 matches per position. A minimum of four matches is <br />considered best practice for determining reliable market -based compensation data. <br />Once the compiled data had been analyzed for quality assurance, Baker Tilly developed and <br />shared with ERMU three market reports: First, an aggregate of the average minimum, midpoint, <br />Page 1 of 2 <br />118 <br />