2.7 ERMUSR 12-12-2017 - Laserfiche WebLink

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Elk River Municipal Utilities UTILITIES COMMISSION MEETING TO: FROM: ERMU Commission Troy Adams, P.E. - General Manager MEETING DATE: AGENDA ITEM NUMBER: December 12, 2017 2.7 SUBJECT: Otsego Street Lights ACTION REQUESTED: Approve and execute Otsego Asset Transfer Agreement and Electric Infrastructure Agreement contingent upon approval and full execution of both agreements by the Otsego City Council. BACKGROUND: In late 2016,the City of Otsego contacted ERMU regarding their city owned street lighting located within ERMU electric service territory. The City of Otsego wanted to explore the possibility of transferring these street lights to ERMU, and then pay ERMU to service and maintain the lights going forward. The ERMU Commission gave staff direction to research this opportunity. In July 2017 the Commission approved terms for the transfer and gave staff direction to develop the agreements with legal counsel. DISCUSSION: The terms for transfer approved by the ERMU Commission in July 2017 were approved by the Otsego City Council. The ERMU approval of the asset transfer is contingent upon the approval of the electric infrastructure agreement by the Otsego City Council. FINANCIAL IMPACT: ERMU will receive $35,000 from the City of Otsego per the terms of the street light transfer agreement; the transferred street lighting will be subject to the same fees,policies, and maintenance as other street lights owned and operated by ERMU. ERMU will receive an extension to the requirement to underground the existing overhead electric distribution along County Road 39, and until such time additional utility easement is provided at no cost to ERMU. ATTACHMENTS: • Proposed Otsego Asset Transfer Agreement • Proposed Otsego Electric Infrastructure Agreement Page 1 of 1 '37