6.2. ERMUSR 07-11-2006 - Laserfiche WebLink

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• The board could ask the Grow With Your City Committee to develop clear guidelines and standards for MMUA assistance to individual cities in service territory cases, which could have the impact of lessening MMUA's overall level of expenditure on individual city litigation. o The amount of assistance to any one city might be capped. o Assistance might be limited only to cases with significant precedential value. • We could consider raising the amount of the assessment on a short-term basis, to bring more money into the fund. As an example, a 15% assessment would bring in about $97,700 this year. • We could consider approaching the joint action agencies for contributions to the fund, which we have not previously done. There is a clear benefit to the agencies, since service territory expansion represents a major portion of their future potential growth. Should we pursue any of these approaches regarding the L&L fund? Are there other things we should be considering? Contract Management Most municipal utilities are very small. About 83% of Minnesota's municipal electric utilities have fewer than 5,000 customers, and 66% have fewer than 2,000 customers. About 40% have fewer than 1,000 customers, and 22% have fewer than 500 customers. Municipal pay scales in Greater Minnesota are pretty low, and it's difficult to keep qualified linemen, much less managers. Most managers in small towns are working supervisors who have to spend the great bulk of their time keeping the system operating, hanging Christmas decorations, and doing all the other day-to-day tasks of operating a utility in a small town. There is not much time for planning, filling out reports, developing customer programs, working on the next power supply contract, etc. It's hard for small towns to raise the level of a manager's salary, since that would set a precedent that could push wages up in other city positions and departments. Sometimes it's easier to pay someone from outside to do the job than to raise the salary of a local employee to a competitive level. As an example, MRES provides line crews for several of its member communities. It's easier for the cities to pay MRES to hire linemen at a competitive wage than it is for the cities to raise the salaries of their own employees. There are several different scenarios that could all potentially benefit from some level of contract management or operations services. A number of small gas utilities, particularly those that were established in the 1990s, are operating systems with little training or background for the task. Some