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12-15-2008 HUCMDecember 15, 2008 Special Meeting Members present: Vice President David Wetterling, Secretary Dwight Bordson; Commissioner Craig Lenz; Commissioner Robert Hantge; Attorney Marc Sebora; General Manager Michael Kumm Member absent: President Donald Walser Vice President Wetterling called the meeting to order at 3:00 p.m. The first item discussed was new business: joint meeting. Each commissioner will e- mail their available dates to GM Kumm for a joint meeting with City Council. GM Kumm will then contact City Administrator Gary Plotz and set a definite date for the joint meeting. Discussion was held on possible items for the agenda at the joint meeting. At this time Commissioner Hantge arrived at the meeting - 3:10 p.m. GM Kumm presented the 2009 budget. Updated changes were distributed and discussed. An informal rate study has been completed and a formal rate study is scheduled for the first part of 2010. Given the state of the economy in Hutchinson, the staff recommended deferring any rate changes until after the formal rate study analysis in 2010, or as needed. After further discussion, a motion was made by Commissioner Lenz, seconded by Commissioner Hantge to approve the 2009 budget. Motion was unanimously carried. There being no further business, a motion was made by Commissioner Hantge, seconded by Commissioner Lenz to adjourn the meeting at 4:13 p.m. Motion was unanimously carried. ___________________________ Dwight Bordson, Secretary ATTEST: _________________________ Donald H. Walser, President December 15, 2008 Special Meeting Members present: Vice President David Wetterling, Secretary Dwight Bordson; Commissioner Craig Lenz; Commissioner Robert Hantge; Attorney Marc Sebora; General Manager Michael Kumm Member absent: President Donald Walser Vice President Wetterling called the meeting to order at 3:00 p.m. The first item discussed was new business: joint meeting. Each commissioner will e- mail their available dates to GM Kumm for a joint meeting with City Council. GM Kumm will then contact City Administrator Gary Plotz and set a definite date for the joint meeting. Discussion was held on possible items for the agenda at the joint meeting. At this time Commissioner Hantge arrived at the meeting - 3:10 p.m. GM Kumm presented the 2009 budget. Updated changes were distributed and discussed. An informal rate study has been completed and a formal rate study is scheduled for the first part of 2010. Given the state of the economy in Hutchinson, the staff recommended deferring any rate changes until after the formal rate study analysis in 2010, or as needed. After further discussion, a motion was made by Commissioner Lenz, seconded by Commissioner Hantge to approve the 2009 budget. Motion was unanimously carried. There being no further business, a motion was made by Commissioner Hantge, seconded by Commissioner Lenz to adjourn the meeting at 4:13 p.m. Motion was unanimously carried. ^ 1 ATTEST: Donald H. Walser, President l D-vJight Bordson, Secretary Hutchinson Utilities Commission Energy Conservation 2009 l� Rebate Programs Low Income Program Marketing Plan 2009 CIP Program CIP figures are based on the 2007 financial reports, and programs have been revised to give a larger return on energy savings for the funds dispersed. 2009 rebates amounts will be tailored to keep the customer appeal, yet allow for a larger energy return per rebate. Adjusting the rebates to a more effective energy saving level, will allow the programs to run longer, effect far more residents, and still provide an excellent incentive to the customers. f PROPOSE 2009 CIP PROGRAMS Figures Based on 2007 Financial Report Electrical Revenue 1.5% CIP Funds Gas Revenue .5% CIP Funds Total funds from revenue Assessments Residential Commercial Industrial Administrative Marketing Special Funding APPA Tree Power Program "Beautifying our Tree Power" $ 27,843,523 $ 417,653 $ 13, 840, 872 $ 69,204 $486,857 $351000 $631575 $ 55,925 $ 272,750 $ 62,500 $20,000 $30)000.00 Rebates Residential Rebates are evaluated to meet the needs of the customers, by providing adequate incentives for the energy measure taken. Keeping with a more accurate rebate to kW savings ratio, rebates for commercial and industrial will be assessed through a prescriptive program, and an expanded custom rebate program. Maintain a greater emphasis on commercial /industrial lighting, HVAC, refrigeration, specialized equipment, motors and controls. Commercial /industrial lighting retrofits and new installations will be paid on a $300 /kW saved rate. Rebates have again been adjusted to create a higher return of energy savings per dollar spent on the energy measure by the customer. All rebate applications will be reviewed and verified accurate before a rebate is issued to the customer. �I Residential Rebate Details • Natural Gas Furnaces, high efficiency (92 AFUE $150) (94> AFUE $250) • Natural Gas Tune -up, (biennial) fan motor replacement ($50) • Natural Gas Boilers (AFUE 85 % >) ($200) • Central Air Conditioners "Energy Star" (13 SEER $150) (14> SEER $250) • Central Air Conditioners Tune -up, (biennial) fan motor replacement ($50) Heat Pumps (14> SEER, 8> HSPF "Energy Star ") ($250) • Tankless Hot Water Heaters ($150) • Natural Gas Water Heaters ($50) • Dehumidifier "Energy Star" ($35) • Dishwashers "Energy Star "($50) • Washers "Energy Star" ($75) • Refrigerators /Freezers "Energy Star" ($75) • Programmable Thermostats ($15) • Compact Fluorescent Light Bulbs "Energy Star" ($25 Max) NOTE: Limited to $500 per household /one application only NOTE: Proof of Disposal required on all appliances Commercial Rebate Details • The commercial rebates will have two parts to the program. One is a prescriptive list of items for set energy retrofits or installations. The second part is a custom rebate which can include items from the prescriptive list, as well as items not on the prescriptive list that show a significant energy return. These items must quantitatively show a high energy savings return to qualify for the custom rebate program. • Commercial rebates are subject to $2000 or less and can be chosen from a comprehensive prescriptive list of items for the energy measure. • Commercial rebates with a total of $2000> can use the custom rebate program for the measures taken. (max of 25% of cost of project) • 44 items in the lighting categories • 42 items from the HVAC categories • 26 items from motors and controls, including pumps and VFD's. • 16 misc. items for refrigeration, washers, ice machines etc. • Note: All existing lighting fixtures and items replaced must show proof of disposal. Low Income frtner with Heartland Community Action Agency to provide services under the federal Dept. of Energy's "Weatherization Assistance Program, and Energy Star Appliances. Work with Habitat for Humanity in assisting them with "Energy Star" appliances and weatherization of new affordable housing projects. All current CIP Low Income projects are reviewed and authorized on a case by case basis. The Low Income Agencies are to provide a comprehensive yearly report of the energy measures implemented for each residence. 2009 Low Income Implementation Plan Hutchinson Utilities Commission will work with the local low- income agencies to disburse funding for the 2009 CIP program. The funds delivered will be for weatherization and energy efficient products. This is considered a direct expenditure of the CIP program. 1) A) Meet with Heartland Community Action Agency to discuss their program for low - income residential weatherization in October of 2008. B) Develop an agreement letter for Heartland Community Action for the 2009 funding by November of 2008. C) Meet with Habitat for Humanity in November of 2008 to discuss their program for 2009. D) Develop an agreement letter for Habitat for Humanity for the 2009 funding by December of 2008. 2). A) Distribute funds to Heartland Community Action Agency in March of 2009. B) Monitor and review the funds delivered from HUC to Heartland Community Action Agency for 2009. C) Distribute funds to Habitat for Humanity in March of 2009. D) Monitor and review the funds delivered from HUC to Habitat for Humanity for 2009. E) All applications, reviewing, and home inspections will be handled by the separate agencies involved. 3). A) Contact Heartland Community Action Agency on a monthly basis in 2009 to obtain updates on their programs progress. Complete HCAA program in November of 2009. B) Contact Habitat for Humanity on a monthly basis in 2009 to obtain updates on their programs progress. Complete HFH program in November of 2009. "CONSERVE ENERGY" "SAVE MONEY" +�tCMINl�. �nimrs HUC'S goal is to educate and promote energy awareness to all of our customers. Achieved by providing our customers with energy tips, fact sheets, Internet web site, annual rebate incentives, online and onsite audits, public awareness programs in the schools and in the community. Marketing Plan 2009 Indirect: Objective 1. HUC will promote the use of energy conservation practices to its residential, commercial and industrial customers, and show that conserving gas and electric energy has a positive impact on the environment and our community. Strategy. HUC will encourage reduction of gas and electric consumption by their customers. Tactics. 1) Education (presentations, pamphlets, home show, promotions, RUC's website and monthly bill inserts). 2) Low income /renter community action programs. 3) Easy and convenient residential and commercial /industrial rebate programs. ctive 2. Continue to build and maintain a positive relationship with HUC's customers and the community. Strategy. Inform HUC's customers of our policies, activities, and programs. Improve public relations through effective community involvement, communications and public awareness. Tactics. 1) Education (ads, radio spots, articles, presentations, energy conservation tips. 2) Scholarship program, and sponsorships. 3) Encourage customers to convenience programs offered by HUC, such as our auto pay, and budget program. n L-A i L Marketing Plan (2) Implemented through the use of newspaper and radio ads, community events, online services, annual open house, and energy conservation presentations tailored to all our customers. Private sector: Work directly with residential customers, and civic organizations on energy conservation. Assist small commercial customers with upgrades and ways to cut energy costs. Utilize large commercial and industrial annual meetings designed to address the future energy conservation needs of the customer and HUC. School systems: Develop programs presented specifically to add to class curriculum within the school system. Promote our scholarship program through Hutchinson high schools. Scheduled tours and safety awareness presentations for specific age groups within all of the schools. Events: Public power week "OPEN HOUSE." Open to the public, Luncheon, promotional items, gas and electric safety demonstrations, tours of unit #1 (LM 6000 generation station, and the renovated downtown plant. Energy awareness program, pamphlets, bill stuffers, video presentation, hand- outs, promotional items. Energy Audits To educate customer on how they can cost - effectively reduce the energy use in their home or business, and assist them in the implementation of the energy measure through retrofit options and rebates. On site audits: Energy bill analysis, load profiles, power factor assessments, mechanical and electrical assessments, Recommendations and follow -up. Energy conservation program programs are greatly enhanced when combined with an on -line or on site energy audits. Audit Objectives Residential: Assess potential energy savings opportunities by doing a self walk - through audit. Customer can use online audit through RUC's website links. Assist residential customers and make recommendations on weatherization, energy efficient appliances, and wise energy conservation measures. Commercial /industrial: Inventory mechanical and electrical systems, analyze which area consumes extensive amounts of energy and develop a potential energy savings opportunity checklist for the facility. Energy audits along with the "key accounts program" at HUC will solidify our business relationships with our commercial /industrial base. These programs are reflective of RUC's commitment to the energy industry in the state of Minnesota. Energy Conservation Perspective With the ever changing criteria and goals of the CIP program through state and federal mandates, it is imperative that we continue to put more emphasis on community awareness, and marketing projects in the future. Having an extensive CIP program that not only has attractive rebate incentives, but has an aggressive marketing plan as well will keep our customers in touch with how their utility is working to meet the growing energy needs of the community. HUC is committed to meeting the needs of the community as well as the goals for the CIP program. The challenge is to utilize the funds set aside for CIP, so that we get the most energy savings for the measures taken. Our goal is to meet or exceed the amount of energy savings that is spelled out for HUC in our integrated resource plan. When the community is aware of our energy programs and the importance of them, the energy savings factor is self motivated. If we can get the community to understand the concept of saving energy through a well rounded marketing plan and an extensive rebate program, "The Buy In ", we can meet our energy goals and keep needed revenues for a successful program. Change at HATS Facility Response Submitted by Jason Sturges and Roberta Yates 11/18/08 Based on past performance and competitive pricing HUC is recommending staying with the vendors and /or service centers that HATS is currently using for HUC's fleet. -Major Repairs will be brought to dealerships if under warranty. If not under warranty use Pro Auto (Crow River Auto — alternate). - Electrical, Engine Diagnostic, Oil Leaks, Wheel Bearing, Seals Lube, Oil, Filters, etc, Preventative Maintenance will go to Pro Auto (Crow River Auto — alternate). -Body Work will require quotes from Hutch Auto Body and Valley (Jay Malone — alternate). -Glass and Windshields will require quotes from Crow River Glass, Harmon Glass and Town & Country Glass. - Hydraulic issues will be brought to Central Hydraulics. - Inspection /Certification — Bucket Trucks will be coordinated by Dave Hunstad — Electric Division Manager. -Heavy Trucks will go to Holt Motors (free pick up and delivery) or North Central International, (Hanson Truck Service — alternate). 10% off hourly rate and wholesale pricing on parts. Holt also has ability to work on excavation equipment. -Tires will require quotes from Brandon Tire or Cenex (Pro -Auto, Crow River Auto — alternates). - Batteries will be purchased off of government discount through Interstate. -All filters will be purchased off of government discount through NAPA or O'Rileys. - HUC will perform all of their DOT inspections. 1 PAYMENT OF YOUR BILL Payments are due by the date shown on the statement. Payments may be made by cash, check, money order, VISA/MasterCard, or automatic bank payment plan, or on- line at www.hutchinsonutilities.com. Check and money orders must be for the exact amounts, no change will be given on a check, money order or credit card. No second party or post -dated checks will be accepted. Checks will not be held. A non suffaGeent fund dishonored check is treated as a non - payment. If notification of the N&F dishonored check is received by HUC, the customer will be charged a $30 N&F processing fee. During business office hours, customers may present payments at either the business office or via HUC's drive -up window. Both options for payment are located at 225 Michigan Street SE, Hutchinson, MN. Additionally, HUC currently provides the following locations for customers to deposit payments via a drop box: Cash Wise Foods, of Hutchinson City Center or HUC's business office located at 225 Michigan Street Southeast. EXPLANATION OF BILLING PROCEDURE A bill for services is sent to the address provided by the customer approximately 3 to 5 days after the meters have been read. The customer then has approximately 10 days to pay the bill in full on by the due date. Bills paid after the due date will incur the following charges: • A 1 % per month late payment charge on any unpaid balance. • A $15 processing fee f ^r payments ro„oived after the due date A dishonored check will be assessed a $30 processing fee; An NSF e•horge .,,,iii also he assessed if a GheGk is returned to us for non_suffinient funds; plus: a. A $40 trip charge to deliver a door hanger, giving customer 24 hours to make check good with cash, money order or credit card. b. A $40 trip charge to disconnect if payment is not received with cash, money order or credit card. C. A $40 trip charge to reconnect after payment has been received with cash, money order or credit card. At the hotter+ of the next mendy hill and by separate letter, A late notice warning of pending disconnection is given mailed which allows the customer approximately 10 -20 days to pay the bill or contact the Customer Service Department to make other arrangements. Examples of other arrangements may include agreement to a budget plan or payments by other agencies. Failure to make payment by the stated date and time will be considered a violation of the notice of pending disconnection. If full payment or other arrangements have not been made by the deadline, HUC personnel are sent to the meter location to disconnect utility services (see disconnection of services section). • A notice will also be on the next month's billing warning of pending disconnection; customer should refer to previously sent disconnection letter for details of date and time of disconnection. IT IS THE CUSTOMER'S RESPONSIBILITY TO PAY BILLS ON TIME AND IN FULL. IT ALSO IS THE CUSTOMER'S RESPONSIBILITY TO KEEP HUC FULLY ADVISED OF ANY CHANGE OF ADDRESS. I