3.0 ERMUSR 03-20-2007 - Laserfiche WebLink

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Page 3 Regular meeting of the Elk River Municipal Utilities Commission February 20, 2007 billion. Generation and transmission rates will rise to pay for these additional facilities. Elk River Municipal Utilities' charge is to keep our rates as low as possible for our customers. Municipal utilities in general own very little transmission and tend to rent their transmission needs and therefore are very susceptible to transmission rate increases. This is Elk River's case. One way to reduce transmission costs is to own versus rent. In May 2006, the Elk River Municipal Utilities Commission authorized joining Midwest Municipal Transmission Group (MMTG) as a vehicle to explore the potential to buy into the transmission system. Due to the successful negotiating efforts of MMTG, we now have the opportunity of buying into the transmission system. The first transmission project is a 345 KV line from Brookings, North Dakota to the Twin Cities at a cost of approximately $600 million. Elk River's load share is approximately $2 million. CapX 2020 participants include Wisconsin Public Power Inc. (WPPI), Central Minnesota Municipal Power Agency (CMMPA), Missouri River Energy Services (MRES), Minnesota Power (MP), Otter Tail Power (OTP), Xcel Energy (Xcel), Great River Energy (GRE), Dairyland Power Cooperative (DPC), the City of Rochester (RPU), Southern Minnesota Municipal Power Agency (SMMPA), and Missouri Basin Municipal Power Agency (MBMPA). CMMPA will be executing the agreement on behalf of MMTG and CMMPA members that are participating in the development of the CapX 2020 Brookings-Twin Cities Project. Elk River Municipal Utilities will be part of the MMTG group associated with CMMPA. At the November 21, 2006, Elk River Municipal Utilities special commission meeting, authorization was given for Elk River Municipal Utilities to proceed with MMTG /CMMPA initiative with a cap of $2,000,000. Peter Beck has been working on the details of this agreement along with Lori Johnson, and have concluded that Elk River Municipal Utilities (ERMU) can enter into this development agreement alone instead of the City of Elk River doing it for ERMU. This pre- development agreement with CMMPA allows the ERMU to participate in this project and enter into future agreements that will establish ownership, operation, maintenance, and revenue stream. This agreement addresses the permitting and engineering phases only. Motion by Jerry Gumphrey to proceed with the CapX 2020 project and to adopt the attached resolution. Jerry Takle seconded the motion. Motion carried 2-0. 5.5 Review Water Rule Changes At the January 2007 commission meeting, a number of changes were adopted to our Water Rules. In the process of making these changes, staff found other areas that also needed to be updated. The updates include; utility personnel will be inspecting and sealing all water meters; 2" water meters will require a by-pass loop; Section 103, second paragraph shall read: Water