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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> Elk River Municipal Utilities Commission Mike O'Neill—Technical Services Superintendent <br /> John Dietz—Chair <br /> Al Nadeau—Vice Chair <br /> Daryl Thompson—Trustee <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> April 12th 2016 5.7 <br /> SUBJECT: <br /> Security Department Cost Analysis <br /> BACKGROUND: <br /> Commission asked about the difference in the revenue for the Security Department from 2014 to <br /> 2015. <br /> DISCUSSION: <br /> In 2015 we began using a new billing system which caused ERMU to calculate certain security <br /> charges differently than in the past using the old system. In the past when customers paid their <br /> entire year's subscription in one payment, it used an accounting method that showed all of that <br /> revenue when paid instead of being spread over an entire year. When the new system was <br /> installed, the system began spreading that payment out over a 12 month period. This caused the <br /> revenue numbers to appear skewed,when in fact the year end results were as anticipated. Please <br /> see attached documents that show these scenarios. As an end result, after calculating all of the <br /> revenue for the security department and deducting all expenses, the security department remains <br /> solvent as well as covers ERMU's own security needs. <br /> ATTACHMENT: <br /> • Security Revenue and Margin—2012 and 2014 <br /> • Security Revenue and Margin—2015 and 2016 <br /> • Security Contribution in Dollars Graph <br /> ■+ POIVERE0 BY <br /> I1r3 Page 1 of 1 MATURE <br /> Reliable Public <br /> Power Provider P OWERED T o S ERV E <br /> 201 <br />