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Elk River <br /> Municipal Utilities UTILITIES COMMISSION MEETING <br /> TO: FROM: <br /> ERMU Commission Melissa Karpinski— Finance Manager <br /> MEETING DATE: AGENDA ITEM NUMBER: <br /> December 14, 2021 5.3 <br /> SUBJECT: <br /> 2022 Annual Business Plan (Budget, Schedule of Rates & Fees) <br /> ACTION REQUESTED: <br /> Adopt the 2022 Annual Business Plan <br /> BACKGROUND: <br /> In November, the preliminary 2022 Annual Business Plan was presented to the Commission. <br /> There have been some changes due to the finalizing of projects and expenses. The final <br /> highlights are discussed below. <br /> DISCUSSION: <br /> Electric Budget and Rates <br /> As discussed in November, we are proposing a 5% rate increase for 2022. <br /> Notable items in the electric budget for 2022 are: <br /> • 3%wage adjustment for Office, Field, and Management pay plan groups and a 2.8% <br /> wage adjustment for Line Worker pay plan group. <br /> • Conservative estimate for usage and growth. <br /> • 11%wholesale power rate increase. <br /> • Interest expense on bond for new field services building. <br /> • Administrative expenses for inventory assistant and new general manager to be filled in <br /> 2022. <br /> • Administrative expense for Travel and Training; Additional leadership training (all <br /> departments as identified in organizational effectiveness survey) and Management <br /> training (includes strategic planning). <br /> • Replacement of Bucket Truck#4. <br /> • Replacement of Dump Truck#7. <br /> • Purchase of a Bobcat, Forklift, and Sweeper. <br /> • Shared cost in the replacement for Vehicle #1 for Administration and Pickup Truck#2 for <br /> Technical Services. <br /> • Electric Service Territory acquisition loss of revenue for Areas 1&2, 3&4, 5&6, and 7&8 <br /> from reserves. <br /> • Highway 169 Redefine project from reserves. <br /> • Highway 10 substation design and construction from reserves. <br /> Page 1 of 2 <br /> 74 <br />