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Elk River Municipal Utilities Commission Meeting Minutes <br />November 12, 2025 <br />Page 4 <br /> <br />Mr. Hanson also clarified that the $8,000 in labor charges had been counted twice in his <br />memo; therefore, the $272,000 in electric charges should be $264,000. <br /> <br />There was discussion to ensure that management will work with city staff to determine <br />which services are practical to bill for, ensuring administrative costs do not outweigh the <br />revenue. <br /> <br />Mr. Berg clarified that the approved PILOT rate changes have been incorporated into the <br />2026 budget projections. <br /> <br />Moved by Commissioner Larson-Vito and seconded by Commissioner Zerwas to approve <br />the amended Commission Policy G.2a1 Payment in Lieu of Taxes and Other Donations to <br />the City of Elk River. Motion carried 5-0. <br /> <br />5.04 Financial Reserves & Investment Committee Update - Verbal <br /> <br />Commissioner Westgaard provided an update from the Financial Reserves & Investment <br />Committee meeting held just prior to the November commission meeting. <br /> <br />Investment Portfolio (as of September 2025): <br />The total portfolio value is approximately $11.6 million, consisting of just over $5 million <br />in cash and nearly $6.6 million in fixed investments. Committee members noted a recent <br />drop in market rates, which will continue to be monitored. <br /> <br />Reserve Balances (as of end of year audited cash balances): <br />Electric: <br />• $9.9 million in unrestricted designated reserves <br />• $1.7 million in restricted debt services <br />• $3 million in unrestricted for capital projects <br />Water: <br />• $1.4 million in unrestricted designated reserves <br />• No restricted reserves for debt service <br />• $8.5 million in unrestricted for capital projects <br /> <br />5.05 Management Policy – A.10 – Financial Reserves <br /> <br />Mr. Hanson presented recommended updates to Management Policy A.10 – Financial <br />Reserves, based on discussions at the October 27, 2025, Financial Reserves & Investments <br />Committee meeting. After comparing ERMU’s financial reserve policy with those of similar <br />municipal utilities, the Committee had recommended several updates. <br /> <br />32