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UTILITIES COMMISSION MEETING <br />TO: FROM: <br />ERMU Commission Melissa Karpinski – Finance Manager <br />MEETING DATE: AGENDA ITEM NUMBER: <br />September 9, 20255.2 <br />SUBJECT: <br />2026 Annual Business Plan: Capital Projects & Equipment Purchases, and 20-Year Capital <br />Projections <br />ACTION REQUESTED: <br />No action is required. <br />DISCUSSION: <br />In preparation for budget submittal in November, staff continues to work through the 2026 <br />budget process. The first draft of the capital budget portion of the 2026 budget has been <br />completed for commission review. The capital budget may change as the complete 2026 <br />budget is assembled, when more information on project timing is available, when the rates <br />change, and once cash flow becomes more definite. Included are the timeline projections for 20 <br />years. Non-capital noteworthy items (expenses) are shown separately from the capital budgets <br />at the bottom. <br /> <br />The following information is included for your review of the capital budgets: <br />1. Electric Department 2026 Capital Budget – Includes large non-recurring capital <br />construction projects, recurring capital construction projects and asset preservation, <br />and capital equipment purchases. Notable items for 2026 include the completion of <br />Advanced Metering Infrastructure (AMI – a multi-year project originally estimated to be <br />completed in 2025), East substation construction (multi-year project estimated to be <br />completed in 2026), Otsego transformer replacement (multi-year project estimated to <br />be completed in 2026), underground equipment replacement, additional/unidentified <br />feeders, replacing digger truck #15, and electric service territory acquisition loss of <br />revenue payments. <br />2. Electric Department Capital 20-Year Projections – Highlights anticipated large non- <br />recurring capital construction projects, recurring capital construction projects, and asset <br />preservation projects through 2045. <br />3. Water Department 2026 Capital Budget – Includes large non-recurring capital <br />construction projects, recurring capital construction projects and asset preservation, <br />and capital equipment purchases. Notable items for 2026 include a new well and water <br />treatment plant, replacement of existing water main at Upland/Meadowvale and city <br />road project, Freeport booster station, and SCADA upgrades. <br />______________________________________________________________________________ <br />Page 1 of 2 <br />66 <br />