Members Present: Mr. Hunziker, *Mr. Jibben, **Mr. Utz,
Mr. Landwehr, Ms. Parker
Absent: None
Board President Landwehr called the meeting to order at
1. Ms. Parker moved to approve the minutes
of the
*Mr. Jibben entered
the meeting at this time.
2. Mr. Hunziker moved to approve the
accounts payable report, seconded by Mr. Jibben. All voting “AYE”
3. Mr.
Landwehr opened the meeting for comments from the public.
a. Ms. Gail
Entrikin,
b. Mr. Norm Erickson, 1303 NE 5th
Avenue, made some suggestions for revising the RPU Partners Program to achieve
several goals including increasing the amount of controllable load during
energy demand peak periods for increased system reliability and energy cost
reduction, increasing residential and small commercial participation
percentages, and making the Partners Program self funding and independent of
Conservation Improvement Program (CIP) dollars by making the Partners Program
mandatory for new service installations.
The Board took no action on these recommendations. Mr. Walters, RPU Manager of Marketing and
External Services, said he would send Mr. Erickson a copy of RPU’s proposal for
CIP spending in 2004. Mr. Koshire stated
that RPU’s CIP spending plan for 2004 would also be discussed with the RPU
Board.
4. The
Board discussed the proposed Letter Agreement with Minnesota Municipal Power
Agency (MMPA). Mr. Koshire informed the
Board that the Agreement was the result of mediation between RPU and MMPA over
billing correction issues and the coal inventory. Mr. Jibben announced that he would abstain
from voting because the Mayo steam project was listed in the Agreement. Mr. Hunziker moved to approve the Agreement,
seconded by Ms. Parker.
3 voting “Aye” (Mr.
Landwehr, Ms. Parker, Mr. Hunziker)
1 Abstain (Mr. Jibben)
Motion Carried
BE
IT RESOLVED by the Public Utility Board of the City of Rochester, Minnesota to
approve a Letter Agreement dated
Agreements Between the Parties Covering
Coal Inventory,
Resolution of the Schechter Dokken Financial Review,
and Future Mediation/Discussions.
5. Mr.
Hunziker moved that the RPU Utility Board receive and place on file the R. W.
Beck study dated October 2003 entitled, “Analysis
of Existing & Potential Regulatory Requirements & Emission Control
Options for the Silver Lake Power Plant.” Mr. Landwehr asked if there were
any other comments on the study from the public. Hearing none, Mr. Koshire told Ms. Entrikin
that RPU was working on an action plan which will be provided to the MPCA
Board. He also said that the plan would
have schedules. Ms. Parker seconded the
motion. All voting “AYE”
** Mr. Utz entered the meeting at this time.
6. The
preliminary budgets for 2004 were discussed and reviewed with the Board. The Board is scheduled to approve the budgets
at their December 30 meeting. The
Council will be asked to approve the budgets at their first meeting in January. Mr. Koshire informed the Board that staff is
requesting electric and water revenue increases with the budget approval this
year due to strong growth in the community and the requirements to provide
electric and water infrastructure to satisfy this growth. Also driving the budget is the significant
spending required for utility re-routings for the highway projects in the
Mr. Koshire said that the Board also needs to
look at cash reserves with respect to power supply in the future. Cash reserves are also being depleted due to
customer growth. Mr. Kraft, Director of
Administration, stated that it costs RPU approximately $1,300 for each new
customer. RPU collects $300 of that
amount as a connection fee, but uses its cash reserves for the remaining
amount. Also when new lots are added,
feeder lines to substations are required and these are not part of our rate
structure. Mr. Koshire said the Fitch
Rating Agency recently said they could not raise RPU’s bond rating because of
the Southern Minnesota Municipal Power Agency’s (SMMPA) wholesale power costs
and because RPU’s cash reserves were not as high as Fitch thought they should
be.
Various scenarios for revenue increases were
discussed with the Board. It was the
consensus of the Board to notice the public that the Board would consider up to
a 3% electric rate increase and up to up to a 5% water rate increase at its
7. The
General Manager provided the following report to the Board:
a. The formation of TRANSLink is on hold
and probably will not occur.
b. There were not enough votes to pass the
Energy Bill, so it will not be enacted this year.
8. The
financials were discussed.
9. Mr. Hunziker moved to adjourn the
meeting, seconded by Mr. Jibben. All
voting “AYE” The meeting was adjourned at
Approved by
the Board: