CITY OF ROCHESTER COUNCIL AGENDA Room 104, City Hall 201 Fourth Street SE Committee of The Whole July 10, 2017 03:30 PM COMMITTEE OF THE WHOLE MEETING ITEMS 1 RPU Department Update (attachment) / Mark Kotschevar - 3:30 p.m. 2 Armory Proposals / Administration - 3:50 p.m. 3 Heart of the City Update (attachment) / Jon Buggy, RSP - 4:20 p.m. 4 Review of New C.O.W. Agenda and 2017 C.O.W. Meeting Schedule (attached) 5 Other Business
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CITY OF ROCHESTER COUNCIL AGENDA Room 104, City Hall 201 Fourth Street SE
Committee of The Whole July 10, 2017
03:30 PM
COMMITTEE OF THE WHOLE MEETING ITEMS
1 RPU Department Update (attachment) / Mark Kotschevar - 3:30 p.m.
2 Armory Proposals / Administration - 3:50 p.m.
3 Heart of the City Update (attachment) / Jon Buggy, RSP - 4:20 p.m.
4 Review of New C.O.W. Agenda and 2017 C.O.W. Meeting Schedule (attached)
5 Other Business
Rochester Public Utilities, 4000 East River Road NE, Rochester, Minnesota 55906-2813 telephone 507-280-1540 .facsimile 507-280-1542 .website www.rpu.org
VISION We will set the standard for service.
CORE VALUES Safety Integrity Service
Stewardship Accountability Skill
MEMORANDUM
DATE: June 29, 2017 TO: Committee of the Whole FROM: Mark Kotschevar – General Manager SUBJECT: Departmental Review Rochester Public Utilities provides electric and water service to the citizens of Rochester. In addition to retail sales of electricity and water, RPU also sells wholesale electricity to the Midcontinent Independent System Operator (MISO) market and wholesale steam to Mayo. Below is a summary of year-end 2016 budget to actual results, 2016 highlights, 2017 year to date financial results, 2017 goals/plans:
Year End 2016 Budget to Actual Results (in thousands)
Non Operating Expenses 3,446 3,617 (171) (54) (45) (9)
Income Before Transfers 15,709 20,625 4,916 262 453 191 ILOT Transfers to City 8,738 8,470 268 365 363 2 Cash Transfers In - 3,062 3,062 - - -
Net Position 6,971$ 15,217$ 8,246$ (103)$ 90$ 193$
Capital Improvements 38,310$ 36,857$ 1,453$ 2,720$ 2,183$ 537$
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July 5, 2017 Page 2 2016 Highlights
• Rochester continued to grow with 1520 new electric customers and 481 new water customers. This reflects a 56% increase in electric customers over 2015.
• Both electric kilowatt hour sales and water ccf sales were up slightly compared to 2015. This was due in part to the increase in customers. In addition, RPU’s Conserve and Save rebate program helped our customers save over 24,000,000 kWh and 2,700,000 gallons of water.
• Completed construction on the new St. Bridget’s water tower. The new tower will add 500,000 gallons on needed water storage to support the St. Bridget’s area.
• Completed $41,800,000 in capital improvement projects identified in our CIP budgets. Of that total, a good portion was related to our investment in the CapX project and the Westside Energy Station with the remaining being additions to the electric and water systems funded from cash. In lieu of tax payments of $8,500,000 and $400,000 were transferred by the electric and water utilities to the City’s general fund.
• The CAPX2020 project was complete by years end. The remaining 345,000 volt segment was placed in service in September. This marks the end of a 10 year, $45,000,000 investment to secure long term transmission service for the City.
• Construction started on the new 47-megawatt Westside Energy Station. Site grading and foundations were completed before year-end. The anticipated in service date is May of 2018.
• Completed exterior restoration of the Lake Zumbro hydro power house. This is the first extensive restoration of the building since it was built in 1919.
• Completed remodeling of the electric control center at the service center. • Implementation of a new customer care and billing system began. This involves a core
team of 6 RPU employees along with consultants that will be dedicated to the project for 18 months.
• Began design and construction on a new 161,000 volt substation to serve a new data center customer.
• Revised our backflow prevention program to be compliant with new plumbing code changes.
• Developed a leadership training curriculum for managers and supervisors to help prepare them for future leadership positions due to future retirements. This is part of our overall succession planning process.
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Year to Date (May 31) Budget-to-Actual Results (in thousands)
2017 YTD + Goals/Plans
• Completed the bond issuance for the Westside Energy Station. • Developed a Community Solar offering. • Completed the new Douglas Trail substation. • Complete the construction of the Westside Energy Station. • Implementation of a new customer care and billing software system. It is anticipated this
will go live in early 2018. • Complete the capital improvement projects identified in the electric and water budgets. • Complete the downtown distribution planning study to identify facilities needed and costs
to serve the future electric load growth in the core downtown area. • Continue with the next steps for the water sustainability study. This involves the
refinement of the groundwater model, field verification of impacts, and additional well and stream flow monitoring.
• Develop a long term water main replacement program that can be used for budget and project planning going forward.
• Participated in the University of Minnesota’s Climate-Smart cities program.
City of Rochester - Rochester City CouncilCommittee of the Whole Discussion Items - 2017
Item Discussion ItemResponsible Dept. /
ProponentTime
SensitivityNext
Review Date Impact Review DateClosed Session - A closed meeting to receive a communication from, and to have a discussion with, the City Attorney regarding the status of and the litigation strategy for the case of Rochester City Lines, Inc., v. City of Rochester, Olmsted County District Court File No. 55-CV-12-1003 (involving the City’s 2011-2012 selection of the operator of its publicly-funded bus transit system) and Rochester City Lines Co., v. City of Rochester and Justin L. Templin, Minnesota Court of Appeals File No. A16-1515 (involving the City’s Moderator’s decision rejecting Rochester City Lines’ pre-bid protests filed as part of the City’s 2016 selection of the operator of its publicly-funded bus transit system). The closed meeting will occur pursuant to Minnesota Statutes, Section 13D.05, subd. 3(b).