Laserfiche WebLink
______________________________________________________________________________ <br /> Page 1 of 2 <br /> <br /> <br /> COMMISSION POLICY <br /> <br />Section: Category: <br />Governance Governance Policies <br />Policy Reference: Policy Title: <br />G.2a1 Payment in Lieu of Taxes and Other <br />Donations to the City of Elk River <br /> PURPOSE: <br />The success of ERMU is linked with the success of our community. And the success of our <br />community is linked with the operation of our city government and ERMU. ERMU was purchased by the City of Elk River in 1945 and separate governance was created per State Statute in 1947. Although governed separately, ERMU is still an important component of our local government and our city services. <br /> <br />It is typical for a municipal utility to provide a Payment in Lieu of Taxes (PILOT) and other donations to their city, regardless of a separation of governance. Although typical, this contribution should never inhibit ERMU’s ability to make repayment on debt, cause ERMU to become non-competitive, or inhibit needed investment in personnel or infrastructure which may <br />hurt ERMU’s ability to meet the needs of their customers. For these reasons the PILOT and other <br />donations should be reviewed at least once every five (5) years by the ERMU Commission. POLICY: <br />The PILOT and other donations to the City of Elk River shall be as follows: <br /> 1. Payment in Lieu of Taxes (PILOT); Electric – The electric PILOT transfer from Elk River Municipal Utilities to the City of Elk River shall be five percent (5%) of the revenues generated by ERMU’s electric customers, except customers qualifying for the Transmission <br />Transformed Service rate, within the corporate boundaries of the City of Elk River. <br /> For the customers that qualify for the Transmission Transformed Service rate, the PILOT transfer from ERMU to the City of Elk River shall be five percent (5%) of the margin remaining from the evenly split charge per kWh to cover dispatching, billing, and <br />administrative costs incurred by the wholesale power provider and ERMU. <br /> Should a catastrophic event occur, the five percent (5%) revenue transfer shall not be paid on the increased energy adjustment clause (EAC) from our power supplier, Minnesota <br />87