Laserfiche WebLink
Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> Elk River Municipal Utilities Commission Theresa Slominski—Finance and Office <br /> John Dietz—Chair Manager <br /> Al Nadeau—Vice Chair <br /> Daryl Thompson—Trustee <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> October 13, 2015 5.1 <br /> SUBJECT: <br /> 2016 Water and Electric Expense Budgets <br /> BACKGROUND: <br /> In preparation for submittal in November, staff continues to work through the 2016 budget <br /> process. The first cut of the expense portion of the 2016 budget has been completed for <br /> commission review. The expense budget will change as the complete 2016 budget is assembled <br /> and the finalized wholesale power costs are reflected. Revenues and rate increases for 2016 will <br /> be presented in November. <br /> DISCUSSION: <br /> Attached is the following information for your review. Additional budget detail is available upon <br /> request. Please contact staff for additional information. <br /> 1. Water Department Expense Budget—The 2016 forecast for water expenses are a 2.37% <br /> increase over the current year budget. There are some re-distributions of the various <br /> labor accounts and so the comparisons are more difficult to use but there are notes in the <br /> margins to help identify where the differences are, as well as some explanations for <br /> notable items. <br /> Using budgeted revenue from 2015, without any water rate increase or adjustment for <br /> new services,the water department would see a potential loss of($96,000)or-3.69% <br /> margin. As numbers are finalized, and revenue projected, this will be brought back in <br /> November. <br /> 2. Electric Department Expense Budget—The 2016 forecast for electric expenses are a <br /> 2.78%increase over the current year budget. Wholesale power costs make up between <br /> 70-75% of the operating budget, and including the power costs,the increase is 2.94% <br /> Ultimately,the wholesale rates set by Great River Energy(GRE)have an enormous <br /> impact on ERMU's rates. GRE has not finalized their 2016 wholesale power rates, and <br /> we estimated a 3% increase,based on current usage. We still will need to factor in <br /> PvOWEDED 01 <br /> Page 1 of 2 NATURE <br /> Reliable Public r P 0 W E 0.E 0 T o S E R V E <br /> Power Provider <br /> 68 <br />