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~/ <br />Elk River <br />Municipal Utilities <br />13069 Orono Parkway • P.O. Box 430 <br />Elk River, MN 55330-0430 <br />July 2, 2007 <br />To: Elk River Municipal Utilities Commission <br />Jerry Takle <br />Jerry Gumphrey <br />Jim Tralle <br />From: Bryan Adams <br />Subject: LFG Expansion <br />Phone: 763.441.2020 <br />Fax: 763.441.8099 <br />At our June 2007 Elk River Municipal Utilities Commission meeting, we discussed the <br />possibility of expanding our LFG facility. Attached is a letter to Sherburne County requesting <br />their financial support. Preliminary discussions with them are very positive. Waste <br />Management has indicated their desire to again allow us to be the lead on this project and craft <br />the agreement to mirror the existing agreements <br />Attached is a project pro-forma reflecting the finances fora 1600KW facility using the same <br />terms and conditions as the existing agreements. Project costs are estimated to be $2,200,000 <br />with a pay back in 15 years instead of 20 years. The increased purchase payments from GRE <br />along with increased payments to Waste Management and bonus payments to Sherburne County <br />have been included. This project still has a positive cash flow of approximately $1,436,044 to <br />Elk River Municipal Utilities. The issue will be to get a modified air permit from MPCA which <br />could take over a year. <br />