Buffalo: the model both sides cite
The petitioners say they modeled their amendment on Buffalo's new utilities commission, and Mayor Baustian's op-ed argues from Buffalo's experience. This page compares both claims with Buffalo's own ordinance, bylaws, minutes, and audited financials.
The short version
- Much of Luverne's amendment follows Buffalo's ordinance nearly word for word: the pay cap, quorum rules, officers, and the clause on negotiating payments to the city.
- The provisions the debate turns on have no Buffalo counterpart: a charter amendment instead of an ordinance, three elected seats, and a large-customer seat whose holder need not live in town.
- Buffalo's commission is all appointed and all resident, and its council fixed the payment formula before the commission ever met. Luverne's amendment writes no formula.
- The two utilities earn nearly the same margin, and Luverne carries more electric debt on a utility half the size.
What Buffalo built
Buffalo created its utilities commission by ordinance. The council adopted Ordinance 2025-3 by a 5–0 vote on November 3, 2025, now City Code § 2-107. Buffalo is a statutory city with no charter, so the ordinance rests on Minn. Stat. §§ 412.321 to 412.391, which the Legislature amended in 2025, at Buffalo's urging, to allow five-member commissions.City of Buffalo, MN (Municode codification)MN Revisor of StatutesCity of Buffalo, MN
The rules: all five members are appointed by the council after open applications, and one or two of them may be sitting council members or the mayor. Every member must live in Buffalo and be a customer of all three utilities. As seated in 2026: the mayor and one council member on one-year terms, and three citizens on staggered three-year terms; one council member was ruled ineligible because she is not a municipal electric customer. There is no business seat. The citizen members were appointed April 6, 2026, and the commission first met May 18.City of Buffalo, MN (Municode codification)City of Buffalo, MN
The payment formula came first. The council's February 2, 2026 minutes record approval of the commission's bylaws and policy manual and of an agreement for payments in lieu of taxes, before the commission was seated. The agreement sets, starting in 2027, 5.5% of electric operating revenue to the general fund plus 0.25% to the housing authority, and 0.5% each from water and sewer. It replaces what had been a flat $1,000,000 a year electric transfer ($1,055,000 in the 2026 budget). Changes need both bodies.Buffalo council minutes, Feb. 2, 2026
It remains one administration. The commission's top employee is a Utilities Director “subject to the overall authority of the City Administrator,” staff stay under the city personnel policy, and the city keeps one consolidated bank account. Buffalo kept its money-losing fiber utility out of the commission.City of Buffalo, MNCity of Buffalo, MN (Municode codification)
Voters can undo it. Under Minn. Stat. § 412.391, written into the ordinance, the council can put abolition on the ballot and must do so if 15% of voters petition. The council can also amend the ordinance itself.MN Revisor of StatutesCity of Buffalo, MN (Municode codification)
Where Luverne's amendment differs
| Topic | Buffalo (in force) | Luverne amendment |
|---|---|---|
| Legal form | City ordinance (2025-3, adopted 5–0 Nov 3, 2025) under Minn. Stat. §§ 412.321–.391 | Charter amendment (new Chapter 11A) by citizen petition |
| Undoing it | Ballot question under § 412.391 (required on a 15% petition); council can amend terms by ordinance | “May be abolished only by a subsequent amendment to this Charter”; the council can change only what the text leaves to ordinance or council action (seat criteria, pay, adding utilities) |
| How members are chosen | All five appointed by the council after open applications | Three elected at large in races on the regular city ballot; two appointed by the council |
| Sitting city officials on it | The ordinance allows one or two. As seated in 2026: two (the mayor and one council member) | At most one of five (the city administrator, or a council member instead) |
| Large-customer seat | None. Every member must be a Buffalo resident and a customer of all three utilities | One seat for a top-25-account business representative who “is not required to be a resident of the City” |
| Chief executive | Utilities Director, “subject to the overall authority of the City Administrator” | General manager hired by the commission, with authority like the city administrator’s |
| Who employs the staff | Commission appoints utility-funded staff; jointly funded staff need council approval; all under city personnel policy | Commission “shall be deemed to be the employer” of union and non-union staff; union contracts continue to expiration |
| Payments to the city | Formula set before the commission met: 5.5% of electric operating revenue, plus 0.25% to housing and 0.5% each from water and sewer (from 2027) | No percentages; a formula both bodies must approve, with no default if they do not agree |
| Real property | Commission can buy and sell on its own; contracts over 10 years need council approval | Every real-property purchase or sale needs council approval |
| Debt | Commission may issue revenue bonds with council approval; the ordinance also allows short-term notes | Commission can only recommend revenue bonds to the council |
| Removing a member | Council may remove for misfeasance, malfeasance, or nonfeasance; three unexcused absences in a year mean removal at year-end | Text lets the council remove any member after a hearing; the attorneys and council say that is invalid for elected members, so on their reading only the appointed ones |
| Start | First meeting May 18, 2026, about six months after the ordinance | First commissioners elected November 2028, seated January 2029 |
Buffalo: City Code § 2-107, commission bylaws, and the February 2, 2026 agreement. Luverne: the amendment on the November 3 ballot, with the city attorneys' memo and Resolution 23-26 on removal.City of Buffalo, MN (Municode codification)City of Buffalo, MNCity of Luverne LegistarCity of Luverne LegistarCity of Luverne Legistar
Four differences matter most. They change who controls the commission, how the city is paid, and how hard it is to change course.
A charter, not an ordinance
Buffalo's council can adjust its commission by ordinance, and voters can abolish it by ballot question. Luverne's amendment writes the commission's existence and core structure (its seats and its main powers) into the charter, so changing those or abolishing it would take another charter amendment. Some terms can still be changed by ordinance: criteria for the large-customer seat, extending the commission to other city utilities, and exceptions to its supervisory authority. Others are ordinary council decisions: commissioner pay, the two appointments, and approval of bonds and long contracts. The options page explains what a charter amendment takes.City of Buffalo, MN (Municode codification)City of Luverne Legistar
Elected seats
None of Buffalo's members is elected to the commission; two are sitting elected city officials appointed by the council. Luverne would elect three of five commissioners in their own races, and could have no sitting elected official on it at all if the city administrator takes the fifth seat.City of Buffalo, MN (Municode codification)City of Luverne Legistar
The large-customer seat
Buffalo requires every member to be a resident customer. Luverne reserves a seat for a representative of one of the 25 largest business accounts, who need not live in the city. The city's attorneys say that seat guarantees large accounts at least 20% of the commission, and that a non-resident seat may conflict with the state law that vacates a local office when the holder lives elsewhere.City of Luverne LegistarCity of Luverne Legistar
No payment formula
Buffalo's council fixed the formula before its commission met. Luverne's amendment leaves the number to a formula both the commission and the council must approve, and sets no default if they do not agree.City of Buffalo, MNCity of Luverne Legistar
Where Luverne keeps more council control
The comparison runs both ways. On real property and debt, Luverne's amendment keeps more power with the council than Buffalo's ordinance does. On removal, the text also reaches further than Buffalo's. The city's attorneys, and the council in Resolution 23-26, take the position that the council cannot remove elected commissioners under Minn. Stat. § 410.20; in that reading it could remove only the appointed members. No court has ruled on the question.City of Luverne LegistarCity of Luverne LegistarCity of Luverne Legistar
On employees, the amendment makes the commission the employer, while Buffalo keeps staff under city personnel policy. At the Luverne forum the committee said employees would remain city employees under the existing union contract; the city's attorneys call the employer question ambiguous under state labor law.City of Luverne LegistarCity of Buffalo, MN (Municode codification)Rock County Star HeraldCity of Luverne Legistar
Are the two cities comparable?
In the basics, yes. Both own electric, water, and wastewater utilities, buy their power wholesale (Buffalo entirely through a joint-action agency, Luverne through federal hydropower plus one), send utility money to the general fund, and earn nearly identical electric operating margins (13.0% and 13.1%). The scale and the stakes differ.
| Measure | Buffalo | Luverne |
|---|---|---|
| City type | Statutory city, Plan A | Home-rule charter city |
| Population (2020 Census) | 16,168 | 4,946 |
| Electric customers (2024) | 6,920 (federal filing) | 2,348 (federal filing); 2,613 (state filing); not reconciled |
| Electric operating revenue (FY2025) | $19.07M | $9.42M |
| Electric operating income (FY2025) | $2.48M (13.0% margin) | $1.23M (13.1% margin) |
| Revenue per kWh, all customers (2024) | 15.52¢ (federal filing) | Not shown: Luverne’s revenue and kWh sources have not been reconciled |
| Generation owned | None (distribution only) | 9.7 MW diesel peaking, paid capacity |
| Wholesale supplier | MMPA, 100% requirements (MISO) | MRES + WAPA federal hydro (SPP) |
| Electric revenue bonds (end of 2025) | $5.18M | $13.84M |
| Electric-fund transfers out (FY2025) | $1.0M flat (≈5.2% of operating revenue) | $262K (≈2.8% of operating revenue) |
| Separate EDA contribution (FY2025) | None identified | $80K |
| Electric franchise fee paid by the utility (FY2025) | None identified | Not published for 2025 |
| Certified 2026 levy | $12.86M (+4.6%) | $3.79M (+6.2%) |
| 2026 levy per resident (2020 Census population) | ≈$795 | ≈$766 |
| Levy growth 2019→2026 | +60% | +98% |
| 2025 state aid (LGA) per resident (2020 Census population) | ≈$89 | ≈$352 |
Audited ACFRs for both cities, 2024 federal EIA filings, and Minnesota Department of Revenue levy and aid lists. Buffalo's 2023 electric figures include its fiber utility and are not used.City of Buffalo, MNCity of LuverneU.S. Energy Information AdministrationMinnesota Department of Revenue
Two differences stand out. First, the published figures do not allow an equal comparison of how much each general fund relies on utility money: Luverne's general fund books electric and gas franchise receipts together and reports transfers from all its enterprises combined, which is a different scope from Buffalo's electric transfer. Luverne's levy has grown 98% since 2019, against Buffalo's 60%.
Second, Luverne owns generation with a paid capacity contract and carries $13.8 million of electric debt, against Buffalo's $5.2 million on a utility twice Luverne's size. That is more balance sheet per customer riding on whoever governs. The Luverne detail is on the money page.
The mayor's op-ed, checked against Buffalo's records
Mayor Baustian's July 8 op-ed is the main public account of Buffalo in this debate. Its description of the commission's makeup is accurate; several framing details differ from Buffalo's own records.Rock County Star Herald
- “Buffalo is a Home Rule Charter city.” It is not. Buffalo is a statutory city (Optional Plan A) with no charter. Its power to create the commission by ordinance came from state statute, after Buffalo officials asked the Legislature to amend § 412.341 in 2025.Minnesota Secretary of StateMN Revisor of Statutes
- “Three years of research.” Buffalo's minutes and staff materials date the public process to April 2024, about 18 months to the ordinance and 25 months to a seated commission. The city itself said “approximately 18 months.” A staff comment mentions earlier informal discussion.City of Buffalo, MN
- The council “voted (5-0) this spring.” The 5–0 vote was November 3, 2025. Spring 2026 is when the citizen members were appointed (April 6) and the commission first met (May 18), which fits the op-ed's “operating for approximately two months” as of July 8.City of Buffalo, MN (Municode codification)City of Buffalo, MN
- Members are paid “75% of what mayor and council members are paid.” Buffalo set pay at $250 a month plus $20 a meeting (chair $300 a month). Against Buffalo's codified council salary, a citizen member at 12 meetings earns about 65% as much. No public document states the 75% figure.City of Buffalo, MN
- Five members: the mayor, a council member, and three community members. Correct. Mayor Steve Downer chairs, council member Brad Dahl is vice chair, and three resident customers fill the other seats. All five were appointed by the council.City of Buffalo, MNCity of Buffalo, MN (Municode codification)
The same standard applies to the petitioners. Their statement, as the mayor's op-ed reports it, that they “drafted their charter amendment based on the one used in Buffalo” cannot be literally true, since Buffalo has no charter, but the text they borrowed from Buffalo's ordinance is real and extensive.
How the 65% pay figure is computed
A citizen member attending 12 meetings a year earns $250 × 12 + $20 × 12 = $3,240. Buffalo's codified council salary is $5,000 a year (City Code § 2-21), so the ratio is about 65%. The chair rate works out to about 77%, the closest documented figure to 75%, but the chair is the mayor, who draws no extra monthly pay. Council salaries could have been changed by an action not yet codified.City of Buffalo, MN