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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> ERMU Commission Theresa Slominski—General Manager <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> December 14, 2021 5.4 <br /> SUBJECT: <br /> 2022 Performance Metrics and Incentive Compensation Policy <br /> ACTION REQUESTED: <br /> Approve the Performance Metrics and Incentive Compensation Policy Score Card for 2022. <br /> BACKGROUND: <br /> The Commission adopted the Utilities Performance Metrics and Incentive Compensation <br /> (UPMIC) Policy in December 2012 along with revisions in 2016 and 2019.This is a company <br /> performance-based program designed to incentivize employee commitment towards the <br /> company's success <br /> DISCUSSION: <br /> Per policy, the metrics for measurement of the designated year need to be determined before <br /> the start of the designated year. This allows for changes to be made and timely communication <br /> before performance measurement begins. Staff is not recommending any changes but has two <br /> points of discussion (below) worth noting. The policy is attached for reference. <br /> In 2019, the commission had consensus to replace the customer satisfaction survey component <br /> with a Clean Energy Choice participation component, with a weight of 5 percent, and a goal of <br /> 15 new customers for the 2020 measurement period. At that time, it was determined that the <br /> most optimal way to measure the results was by an increase in the number of new participants <br /> versus a percentage. 29 new participants were added in 2020, and 21 new participants have <br /> been added year-to-date in 2021. Staff has had discussion whether to recommend the goal of <br /> 15 new participants be increased or remain the same for the 2022 measurement period. With <br /> the pending 2022 rate increases, staff believes that a modest increase to 20 new participants <br /> may be challenging. We would like one more year of history before proposing any changes and <br /> we can discuss next year. <br /> Staff has been auditing the water loss component to ensure that any unmetered water is being <br /> accounted for in the usage component of the calculation, as this could incorrectly represent <br /> water loss. Some of the things we've identified are temporary water services for construction <br /> and hydrant rentals, however, staff is not proposing any changes to the water loss component <br /> at this time. <br /> The proposed UPMIC score card is attached for approval for the 2022 measurement year. <br /> Page 1 of 2 <br /> 43 <br />