NEW ULM — The New Ulm Public Utilities Commission (PUC) authorized filing a proposed deferred payment plan for unpaid utility bills which won’t be disconnected under COVID-19 peacetime emergency rules.

In March, the PUC authorized New Ulm Public Utilities (NUPU) to waive the penalties and suspend disconnection to residential and commercial customers due to the declaration of COVID-19 peacetime emergency. Originally the suspension was until April 30, but was later extended to June 30.

Utilities Director Kris Manderfeld said with the suspension of disconnects, it is important to have a policy in place once the utility payment deferment has ended. A preliminary outline for the plan was presented.

NUPU is seeking further advice on the policy, and other community utilities across the state are dealing with this issue. Manderfeld said the Minnesota Municipal Utilities Association (MMUA) is in discussion with the Minnesota Department of Commerce for guidance on how to deal with unpaid utility bills. A survey of other Minnesota utilities is also underway to have a unified response. Staff will continue to work on the policy and forms needed and will bring the final procedure back to the PUC for approval.

Currently NUPU has 147 commercial and residential customers that have suspended disconnection, for a total of $109,258. At this time 57% of the 147 customers owe two months in deferred payments.

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The PUC filed a proposed business utility deferment program available to businesses affected by COVID-19.

In response to the financial hardships suffered by COVID-19, a program was proposed to help businesses in the short term to open and return to normal operations.

This program would be available to businesses that have been forced to close or reduce service. The business would be allowed to defer up to three consecutive months of utility bills with a bill date between March 1, 2020, and August 31, 2020. The customer would choose the three months to defer; however, if the customer has outstanding utilities that are unpaid, those would not fall under the provision and would reduce the months allowed under this program.

At the end of the month of the last deferred utility bill, the unpaid utility bills will be spread evenly over the repayment term. The business has the option of a six-month or 12-month payment plan. Interest in the payment plan will be 0.5%.

All businesses participating in the program will need to fill out an application citing the executive order that relates to their business, identify the three months they wish to defer payment and sign a payment agreement.

Manderfeld said this plan was for businesses that are opening up or on reduced schedules, to free up cash to buy inventory or pay employees before going into default. A business already in default would already be eligible for the previous deferment plan.

The recommendation was to conform with the COVID-19 peacetime emergency declared by Gov. Tim Walz. Disconnection policies will be reinstated following the end of the emergency.

Repayment of deferred utilities will begin approximately 30 days after the emergency has ended. Utility holders will need to sign a repayment agreement within the 30 days after the emergency has ended, or the total unpaid utility bill will be due on the next subsequent billing date. An amortization schedule will be calculated which will provide the amount of the deferred payment to be paid each month with the term not to exceed 12 months from the end of the emergency disconnection policies and late payment penalties will apply to current utility bills 30 days after the emergency has ended.

Failure to follow the terms of the repayment agreement will be subject to the normal disconnection policies outlined in the NUPU.

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The PUC approved a contribution of $1,500 to the New Ulm Partnership for a Strategic Plan for Economic Development.

The New Ulm Partnership is comprised of representatives of the New Ulm Area Chamber of Commerce, the New Ulm Economic Development Corporation, Independent School District 88 and the City of New Ulm. The partnership is requesting this contribution to help fund the plan. The plan would identify the roles and responsibilities of the economic development groups serving New Ulm, and determine the mission and vision goals, strategies and final actions for economic development.

The cost of these plans can range from $15,000 to $50,000. The partnership has received a $7,500 grant from the New Ulm Area Foundation to pay half of the cost and a contribution of $1,500 from the City Development Corporation and the chamber. The partnership is requesting a contribution of $1,500 from the NUPU to help complete the plan.

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The board approved the creation of a Frequently Asked Question (FAQ) sheet for potential homeowners. This approval was related to an emergency sewer service repair in the 700 block of 6th South Street.

The sewer service was installed on 6th South Street to South Washington Street for approximately 275 feet. The sewer system is in the middle of the street which required the pavement to be cut open and some curb and sidewalk by the house to be removed.

PUC regulations state sewer service to the main is the responsibility of the property owner.

Property owner Jennfier Waloch attended the PUC’s March meeting. She said she was aware of the city’s position on homeowners repairing lines, but she believes if the city had taken different actions this repair could have been avoided.

Her home is on a side street between State and Washington. When the sewer was installed, it was not at today’s code. The line runs to Washington Street even though the home is closer to State Street.

The line goes down the center of 6th Street instead of under the boulevard. The Walochs were not made aware of this. In fall 2018 the street was repaired which could have allowed for a lower cost repair if the Walochs had known where the line was located.

Waloch asked the PUC to help educate other homeowners of this issue to prevent the same issue from impacting future homeowners.

Following a PUC work session, it was recommended to prepare a FAQ sheet to educate homeowners. Manderfeld said the sheet would provide answers to questions homeowners should ask when purchasing a home. The commissioners approved the creation of a FAQ sheet and a draft of the document will be presented at future PUC meeting.

Waloch also requested the PUC pay for the paving of South 6th Street that was dug up due to the repair. The commissioners denied this request as the PUC does not have a paving crew and the city of New Ulm cannot use taxpayer money to cover improvements to a private residence. Approval could also set a precedent for further requests.

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NUPU staff authorized requesting proposals to obtain a market analysis of the energy and capacity markets for the next 20 years.

On January 1, 2010, NUPU entered a contract with Heartland Consumers Power District (HCPD). This contract provided up to an 18 megawatt (MW) block of energy and capacity. The contract term is from January 1, 2010, to December 31, 2029, with a five-year termination clause.

Recently, HCPD was able to participate in the re-powering of the Wessington Springs wind farm and has realized savings on their wind supply. HCPD approached NUPU offering that the utility could share in the savings that are being received if NUPU would consider extending the contract an additional 10 years.

Manderfeld said NUPU would like to review alternative options before agreeing to extend the contract another 10 years.

“We believe that it would be in the best interest of ratepayers to obtain a market analysis,” she said.

Manderfeld explained with changes in the energy market due to innovations in wind, solar and battery storage, it was prudent to see what options are available.

The cost of a market analysis is unknown at this time. NUPU has never analyzed this before. The cost of the analysis will be presented to the commissioners before the final approval. At this time the request was only to seek proposals.