PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED Direct Testimony and Schedules William K. Husen Before the Minnesota Public Utilities Commission State of Minnesota In the Matter of the Application of Northern States Power Company for Authority to Increase Rates for Electric Service in Minnesota Docket No. E002/GR-20-723 Exhibit___(WKH-1) Employee Expenses November 2, 2020 PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED Table of Contents I. Introduction 1 II. Definition and Governance of Employee Expenses 6 III. Employee Expense Reporting 10 A. SumTotal 10 B. Other Systems 14 C. Internal Controls and Monitoring 17 IV. Employee Expense Amount, Employee Expense Adjustment, 20 and EER Schedules V. Employee Expense Review and Development of EER 27 Schedules A. Employee Expense Review Process 27 B. Details Regarding EER Schedules 34 VI. Fleet Capital Investments 40 A. Overview 40 B. Fleet Capital Additions by Category 46 1. Fleet Asset Replacements and Additions 46 2. Fueling Depots 49 3. Fleet Repairs 51 4. Garage Tools 52 VII. Compliance Item on Lobbying Compensation 53 VIII. Conclusion 53 i Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED Schedules Statement of Qualifications Employee Expense Policy Summary of Employee Expense Policy Changes Commitment Matrix LMS Training: Travel and Employee Expense Reimbursement Job Aid: Creating and Submitting Expense Reports Job Aid: Approving an Expense Report Employee Expenses Budgeted vs. Actual List of EER Schedules EER Schedule Process Fleet Capital Additions Employee Compensation for Lobbying Activities Schedule 1 Schedule 2 Schedule 3 Schedule 4 Schedule 5A Schedule 5B Schedule 5C Schedule 6 Schedule 7 Schedule 8 Schedule 9 Schedule 10 ii Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 I. INTRODUCTION 2 3 Q. PLEASE STATE YOUR NAME AND OCCUPATION. 4 A. My name is William Kile Husen. I am Director of Process Government and 5 Performance within the Supply Chain business area for Xcel Energy Services 6 Inc. (XES or the Service Company), which provides services to Northern 7 States Power Company (Xcel Energy, NSPM, or the Company). 8 9 Q. PLEASE SUMMARIZE YOUR QUALIFICATIONS AND EXPERIENCE. 10 A. I have over 17 years of experience with Xcel Energy in the supply chain 11 management area and previous experience at other companies leading 12 financial and financial systems areas. In my current role, I direct the team that 13 leads the system implementations and process oversight function for Xcel 14 Energy's Supply Chain organization, including the Company's credit card 15 program, the SumTotal expense report system, the supply chain portions of 16 SAP, and the fleet management systems. I also have budgetary responsibilities 17 for the Supply Chain organization. My resume is provided as 18 Exhibit___(WKH-1), Schedule 1. 19 20 Q. WHAT IS THE PURPOSE OF YOUR DIRECT TESTIMONY? 21 A. I provide support for the amount of employee expenses requested for 22 recovery in this rate case as well as the Employee Expense Report (EER) 23 Schedules filed by the Company in compliance with Minnesota law and the 24 commitments made in our prior electric rate cases. In the 2011 test year 25 electric rate case (Docket No. E002/GR-10-971),1 the Company made several 1 Docket No. E-002/GR-10-971, In the Matter of the Application of Northern States Power Company d/b/a Xcel Energy for Authority to Increase Rates for Electric Service in the State of Minnesota. 1 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 commitments to improve the review, tracking, and documentation of 2 employee expenses. My testimony, the EER Schedules, and data we are 3 providing in this case comply with the commitments made in the 2011 rate 4 case and subsequent rate cases, the Commission's Orders, and Minnesota 5 Statutes § 216B.16, subd. 17 (Employee Expense Statute). The EER 6 Schedules are provided in Volume 3 Required Information, Section IV 7 Other Required Information, Tab 2. 8 9 Additionally, my testimony provides support for the Supply Chain business 10 area's fleet capital investments for 2021-2023. The budgeted capital additions 11 for fleet functions are $18.3 million in 2021, $19.3 million in 2022, and $18.7 12 million in 2023 for the State of Minnesota Electric Jurisdiction. 13 14 Q. WHAT IS THE EMPLOYEE EXPENSE AMOUNT FOR THE 2021 TEST YEAR? 15 A. The Employee Expense Amount for the test year 2021 is approximately $16.2 16 million for the State of Minnesota Electric Jurisdiction. This amount is based 17 on the Company's budgeting process, which is a forward-looking projection 18 of future projects, costs, and operating needs. Employee expenses are part of 19 the overall O&M budgets of our various business areas and the Company 20 does not prepare a separate budget for employee expenses. The Employee 21 Expense Amount of $16.2 million is the combined amount of employee 22 expenses included in 2021 business area budgets. 23 24 Q. WHAT LEVEL OF ADJUSTMENT DOES THE COMPANY PROPOSE TO THIS 25 AMOUNT? 26 A. Based on the review of actual employee expense transactions from 2019, we 27 propose an Employee Expense Adjustment of approximately $1.6 million. As 2 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 a result of deducting this adjustment from the Employee Expense Amount, 2 we are requesting recovery for approximately $14.6 million for employee 3 expenses for the test year 2021. The Employee Expense Adjustment consists 4 of transactions that are likely to be non-recoverable and are considered to be 5 representative of such transactions that could occur in 2021. Company witness 6 Mr. Benjamin Halama reflects this $1.6 million adjustment in his Direct 7 Testimony. 8 9 Q. HOW DO YOU PROPOSE TO RECOVER EMPLOYEE EXPENSES FOR YEARS 2022 10 AND 2023 OF THE MULTI-YEAR RATE PLAN (MYRP)? 11 A. Similar to the test year 2021, the Employee Expense Amount for plan years 12 2022 and 2023 is based on the combined amount of employee expenses 13 included in 2022 and 2023 business area budgets. For plan years 2022 and 14 2023, we modified the test year 2021 Employee Expense Adjustment of 15 approximately $1.6 million to reflect the changes in the Employee Expense 16 Amount from 2021 to 2022 and from 2022 to 2023. This process resulted in 17 an approximately $1.5 million adjustment for 2022 and an approximately $1.6 18 million adjustment for 2023. The process used to calculate these adjustments 19 is described in more detail in Section IV of my testimony. 20 21 Q. IS THE METHODOLOGY TO DEVELOP THE 2021 TEST YEAR EMPLOYEE 22 EXPENSE AMOUNT AND EMPLOYEE EXPENSE ADJUSTMENT CONSISTENT 23 WITH PAST PRACTICE? 24 A. Yes. We have used this process which was largely developed through work 25 with the Office of Attorney General (OAG) in each of the Company's rate 26 cases since 2010. This methodology is also consistent with the Employee 3 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Expense Statute that became effective in May 2010 and its requirement to 2 compile EER Schedules based on the most recently completed fiscal year. 3 4 Q. IS THE EMPLOYEE EXPENSE ADJUSTMENT PROPOSED FOR 2021, 2022, AND 5 2023 COMPARABLE TO THE ADJUSTMENT THE COMPANY PROPOSED IN THE 6 PAST RATE CASES? 7 A. Yes. The Employee Expense Adjustment is based on the same process we 8 used to develop the adjustment in our last four rate cases and reflects the 9 commitments we made in the 2011 rate case. Our proposed adjustment of 10 $1.6 million is comparable to the one we made in the test year 2013 rate case 11 ($1.6 million, Docket No. E002/GR-12-961), in the test year 2014 rate case 12 ($1.4 million, Docket No. E002/GR-13-868), in the test year 2016 rate case 13 ($1.6 million, Docket No. E002/GR-15-826), and in the test year 2020 rate 14 case ($1.5 million, Docket No. E002/GR-19-564). I note that the Company 15 withdrew the test year 2020 rate case before the Minnesota Public Utilities 16 Commission had accepted the filing or addressed its completeness. 17 18 Q. IS THE COMPANY SEEKING RECOVERY FOR CORPORATE AVIATION EXPENSES 19 IN THIS CASE? 20 A. No, we are not requesting recovery for any corporate aviation expenses in this 21 case. Our 2021, 2022, and 2023 budgeted corporate aviation costs for the 22 State of Minnesota Electric Jurisdiction are approximately $2.8 million in 23 2021, $2.2 million in 2022 and $2.6 million in 2023. In order to exclude these 24 amounts from this case, we have made adjustments of approximately $2.8 25 million for 2021, $2.2 million for 2022, and $2.6 million for 2023. This is 26 reflected in Mr. Halama's Direct Testimony. 27 4 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. HOW HAVE YOU ORGANIZED THE REMAINDER OF YOUR TESTIMONY? 2 A. My testimony is organized in the following sections: 3 · Section II: Definition and Governance of Employee Expenses. Discusses the 4 definition of employee expenses; reporting requirements under the 5 Employee Expense Statute; the Company's Travel and Employee 6 Expense Reimbursement Policy 10.2 (Employee Expense Policy); and 7 commitments made in our past rate cases. 8 · Section III: Employee Expense Reporting. Describes the Company's 9 employee expense reporting and provides details of SumTotal, other 10 systems, and internal controls. 11 · Section IV: Employee Expense Amount, Employee Expense Adjustment, and 12 EER Schedules. Explains the statutorily required EER Schedules, the 13 Employee Expense Amount based on business area budgets, and the 14 Employee Expense Adjustment that removes likely unrecoverable 15 expenses from the test year. 16 · Section V: Employee Expense Review and Development of EER Schedules. 17 Explains in detail how the actual 2019 employee expense transactions 18 were reviewed to remove items that are likely not recoverable, including 19 key word search and identification of vague business purposes, 20 transactions inconsistent with the Employee Expense Policy, and 21 transactions not generally needed for the provision of utility service. 22 · Section VI: Fleet Capital Investments. Supports the Company's budget for 23 fleet capital additions under Supply Chain's Fleet organization. 24 · Section VII: Compliance Item on Lobbying Compensation. Describes the 25 Company's compensation for employees engaged in lobbying and 26 explains the costs included and excluded in the rate request. 27 · Section VIII: Conclusion. 5 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 II. DEFINITION AND GOVERNANCE OF EMPLOYEE EXPENSES 2 3 Q. HOW DOES THE COMPANY DEFINE EMPLOYEE EXPENSES? 4 A. Employee expenses are those operation and maintenance (O&M) 5 expenditures that are: 6 (1) tracked in our employee expense reporting system; 7 (2) subject to the guidelines in the Company's Employee Expense Policy; 8 and 9 (3) consistent with the categories set forth in the Employee Expense 10 Statute. 11 12 Examples of employee expenses are airfare, hotel stays, car rental, mileage on 13 personal vehicles used for work purposes, parking, meals for business 14 purposes, and recognition for the work performed by Company employees to 15 provide safe and reliable service to customers. 16 17 Q. IN GENERAL, ARE THE COMPANY'S EMPLOYEE EXPENSES NEEDED FOR THE 18 PROVISION OF UTILITY SERVICE? 19 A. Yes. At times, Company business requires that our employees work at 20 locations other than their offices or primary work locations, attend training, or 21 meet with our customers and stakeholders. For example, employees incur 22 expenses when they work in the field to ensure the reliability of the 23 Company's facilities and equipment, manage workers across our eight-state 24 service territory, or travel to attend conferences or training to maintain their 25 knowledge base. For these types of activities, Company employees incur 26 expenses as guided by the Employee Expense Policy. 6 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. WHAT ARE THE STATUTORY REPORTING REQUIREMENTS REGARDING 2 EMPLOYEE EXPENSES? 3 A. The Employee Expense Statute establishes the primary regulatory reporting 4 requirements for employee expenses. The statute requires the Company to 5 provide, when filing a general rate case, a schedule separately itemizing: 6 (1) travel and lodging expenses; 7 (2) food and beverage expenses; 8 (3) recreational and entertainment expenses; 9 (4) expenses (and compensation) for board of directors; 10 (5) expenses (and compensation) for the ten highest paid officers and 11 employees; 12 (6) dues and expenses for memberships in organizations or clubs; 13 (7) gift expenses; 14 (8) expenses related to owned, leased, or chartered aircraft; and 15 (9) lobbying expenses. 16 17 For items (1) and (2), the Company is required to separately provide data for 18 employees who are at the vice president-level and above. Employee expense 19 transaction data must be from the most recently completed fiscal year and 20 include the date, amount, business purpose, and vendor for the expense. 21 22 Q. PLEASE DESCRIBE THE COMPANY'S EMPLOYEE EXPENSE POLICY? 23 A. The Travel and Employee Expense Reimbursement Policy (Corporate Policy 24 10.2) (Employee Expense Policy) provides the guidelines applicable to all non- 25 bargaining and bargaining employees who incur travel or other business- 26 related expenses. The current version of the Employee Expense Policy is 27 provided in Exhibit___(WKH-1), Schedule 2. Since filing our test year 2020 7 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 rate case, we have revised the Employee Expense Policy in January 2020 and 2 February 2020. For the January 2020 revisions, we conducted a complete 3 review of the Employee Expense Policy, restructured the policy to match the 4 Company's refreshed policy template to display content, and made additional 5 changes to ensure that the policy is easily understood by all employees. A 6 summary of these changes, along with some earlier changes, is provided in 7 Exhibit ___(WKH-1), Schedule 3. 8 9 Q. WHAT COMMITMENTS REGARDING EMPLOYEE EXPENSES DID THE COMPANY 10 MAKE IN ITS 2011 AND 2013 RATE CASES? 11 A. During our 2011 rate case (Docket No. E002/GR-10-971), we made a 12 number of commitments to provide more detailed information in the Direct 13 Testimony and to improve the quality of employee expense data to facilitate 14 review of employee expenses in our future rate cases. These commitments are 15 summarized in Exhibit___(WKH-1), Schedule 4. Also, in preparing for the 16 test year 2013 rate case (Docket No. E002/GR-12-961), we made some 17 additional commitments in a meeting with the OAG, which are also included 18 in Schedule 4. 19 20 Q. DID THE COMPANY MAKE ANY ADDITIONAL COMMITMENTS REGARDING 21 EMPLOYEE EXPENSES IN THE SUBSEQUENT 2014 RATE CASE (DOCKET NO. 22 E002/GR-13-868) OR 2016 RATE CASE (DOCKET NO. E002/GR-15-826)? 23 A. No. 24 8 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. PLEASE DESCRIBE WHETHER THE COMPANY'S 2013 AND SUBSEQUENT RATE 2 CASES RESULTED IN ADDITIONAL COMMITMENTS OR REQUIREMENTS 3 RELATING TO EMPLOYEE EXPENSES? 4 A. The Commission's Orders in the 2013 and 2014 rate cases required that if the 5 Company seeks recovery for corporate aviation costs in future rate cases, the 6 Company should provide more information, but did not otherwise add any 7 new requirements for employee expenses. In the 2013 rate case, the 8 Commission ordered us to provide flight log and passenger information for 9 the most recent 12-month operational period. In the 2014 rate case, the 10 Commission ordered us to provide more detailed records of the actual 11 business purpose for flights that are scheduled, rather than reducing all flights 12 to a generic "code." These requirements are summarized in 13 Exhibit___(WKH-1), Schedule 4. The Commission's Order in the Company's 14 2016 rate case did not add any new requirements for employee expenses. The 15 Company's 2020 rate case was withdrawn; there was no Commission activity 16 in that case that resulted in requirements relating to employee expenses. 17 18 As noted earlier, the Company is not requesting recovery of any corporate 19 aviation expenses in this rate case, and therefore we have not provided any 20 flight log, passenger, or business purpose information. That said, to ensure 21 completeness, we are providing expenses related to corporate aviation in EER 22 Schedule 8, consistent with the Employee Expense Statute. 23 9 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. HAS THE COMPANY FULFILLED ALL ITS COMMITMENTS AND 2 COMMISSION REQUIREMENTS IN DEVELOPING THE EER SCHEDULES AND THE 3 EMPLOYEE EXPENSE AMOUNT AND ADJUSTMENT? 4 A. Yes. My Direct Testimony, the EER Schedules, and the actions the Company 5 has taken and continues to take demonstrate our fulfillment of the 6 commitments and requirements established in the prior rate cases. 7 Exhibit___(WKH-1), Schedule 4 identifies where each commitment or 8 requirement is addressed in this case. Our employee expense compliance and 9 methodology to develop the Employee Expense Amount and Adjustment 10 have evolved for many years in collaboration with the OAG, are compliant 11 with the Employee Expense Statute, and have resulted in just and reasonable 12 outcomes in past cases and will also do so in this case. 13 14 III. EMPLOYEE EXPENSE REPORTING 15 16 Q. HOW DOES THE COMPANY TRACK EMPLOYEE EXPENSE TRANSACTIONS? 17 A. Our main tool to document and manage employee expense transactions is 18 SumTotal. We have used this intranet application system since October 2012. 19 Some employee expenses are also reported through the Company's SAP and 20 TIME applications. These separate applications are described in more detail 21 below. 22 23 A. SumTotal 24 Q. WHAT KIND OF EMPLOYEE EXPENSES ARE REPORTED THROUGH SUMTOTAL? 25 A. All bargaining and non-bargaining employees are required to use SumTotal to 26 report and properly account for expenses that are charged to the Company 27 credit card. This is the required payment method for all expenses that can be 10 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 paid with a credit card. In addition, non-bargaining employees report through 2 SumTotal cash-out-of-pocket expenses that cannot be charged to the 3 Company credit card. Typically, such expenses may include parking, personal 4 car mileage, taxi/bus/other transportation, and tips/tolls. 5 6 Q. HOW DOES SUMTOTAL FACILITATE APPROPRIATE EMPLOYEE REPORTING AND 7 MANAGER APPROVAL OF EMPLOYEE EXPENSES? 8 A. SumTotal requires detailed information from the employee for all appropriate 9 fields to finish an expense report. The system notifies the user of potential 10 inconsistencies with the Employee Expense Policy and also prompts for 11 missing information. In addition, an electronic copy of all required receipts 12 must be included with the expense report for manager review and approval. 13 All expense reports require at least one next-level management approval. 14 Additionally, if information provided in SumTotal is not in compliance with 15 the Company guidelines, the transaction is flagged for further review by a 16 group within Supply Chain with oversight authority. 17 18 Q. DOES THE USE OF SUMTOTAL ALLOW THE COMPANY TO COMPLY WITH THE 19 REPORTING REQUIREMENTS IN THE EMPLOYEE EXPENSE STATUTE? 20 A. Yes. SumTotal includes all data fields necessary to comply with the Employee 21 Expense Statute reporting requirements. The transaction date, expense type, 22 expense category, business purpose, line comment, transaction amount, and 23 vendor name fields are populated for data review and analysis. 24 25 Q. WHAT SUMTOTAL TRAINING IS AVAILABLE FOR COMPANY EMPLOYEES? 26 A. Our online Learning Management System (LMS) has three training modules 27 related to the Employee Expense Policy and SumTotal. All new SumTotal 11 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 users are required to complete the Travel and Employee Expense Reimbursement 2 training, which focuses on the Employee Expense Policy. Every SumTotal 3 user is also required to take a periodic refresher training on this course. These 4 training materials are provided as Exhibit___(WKH-1), Schedule 5A. We also 5 provide optional Create and Submit an Expense Report and Approving an Expense 6 Report courses in LMS. 7 8 Q. DOES THE COMPANY PROVIDE OTHER RESOURCES FOR SUMTOTAL USERS? 9 A. Yes. We maintain an internal website for travel and employee expenses, which 10 is a one-stop place for employees to find more information on reporting 11 requirements and SumTotal. This website contains, among other things, links 12 to frequently asked questions, forms, job aid manuals, and reference 13 documents. For example, we have published for employees and their 14 managers detailed job aid manuals Creating and Submitting Expense Reports 15 (attached as Exhibit___(WKH-1), Schedule 5B) and Approving an Expense 16 Report (attached as Exhibit___(WKH-1), Schedule 5C). 17 18 We also use General Notifications, delivered via Outlook email and SumTotal 19 Inbox, to notify all SumTotal users about potential system functionality 20 changes, policy updates, and useful tips. 21 22 Q. WHAT IS THE GOAL OF SUMTOTAL TRAINING AND INFORMATIONAL 23 MATERIALS? 24 A. The goal is that our employees understand the Company's Employee Expense 25 Policy and are able to accurately report their business-related expenses with 26 appropriate documentation. Overall, the training and educational materials are 27 designed to teach employees how to use SumTotal's functionality to enter 12 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 information into expense reports more efficiently and in conformity with the 2 Employee Expense Policy. These materials also educate expense report 3 approvers of the tools available within SumTotal to facilitate their review and 4 approval. 5 6 Q. WHAT ADDITIONAL TOOLS AND HELP ARE AVAILABLE FOR EMPLOYEES WHO 7 ARE PREPARING AN EXPENSE REPORT IN SUMTOTAL? 8 A. There are two types of additional help available if employees have questions or 9 problems when they are preparing an expense report in SumTotal. First, they 10 can call the Supply Chain hotline. Hotline specialists who answer the phones 11 can view the expense report that is being prepared and give step-by-step 12 directions how to finish it correctly. Second, employees can use an online 13 help tool Job Aid, which was implemented in 2013 in SumTotal. When an 14 employee is preparing an expense report, she or he can point to the Job Aid in 15 SumTotal, which then gives additional information on the specific field. 16 17 Q. HAS THE COMPANY MADE ANY RECENT IMPROVEMENTS RELATED TO 18 SUMTOTAL? 19 A. Yes. We updated to a newer version of SumTotal in November 2019. This 20 change was mostly a technical upgrade and did not materially impact the 21 preparation of expense reports in the system. Therefore, the users did not 22 experience significant changes. 23 24 Q. DOES SUMTOTAL ALSO INCLUDE TRANSACTIONS THAT ARE NOT CONSIDERED 25 AS EMPLOYEE EXPENSES? 26 A. Yes. Employees are directed to use the Company credit card for minor 27 material and service purchases, which are not considered employee expenses. 13 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 In the normal course of business, these types of items include office supplies, 2 tools, printing services, subscriptions to magazines and information services, 3 and office furniture. Although these credit card transactions are reconciled 4 through SumTotal, they are typical cost-of-doing business expenses not 5 covered by the Employee Expense Statute or the Employee Expense Policy. 6 7 Q. HAS THE COMPANY MADE ANY OTHER RECENT IMPROVEMENTS RELATED TO 8 TRAVEL OR OTHER EMPLOYEE EXPENSES? 9 A. Yes. In May 2020, the Company contracted with a new designated travel 10 agency to improve the service for our employees. The transition to use 11 Executive Travel Inc. provides new or updated tools and capabilities, 12 including a booking tool through Concur Travel, a mobile phone application 13 to manage travel, and reporting tools to monitor employee travel. This 14 transition also streamlined booking and reduced the booking cost per 15 transaction. 16 17 In addition, the Company shifted the Corporate credit card provider from 18 Bank of Montreal to US Bank, effective August 1, 2020. The Company already 19 used US Bank for its Fleet Fuel Credit Card and this change leveraged the 20 existing relationship with US Bank and improved capabilities for both credit 21 card programs with new functionality and reporting. 22 23 B. Other Systems 24 Q. WHAT OTHER COMPANY SYSTEMS WERE USED IN 2019 TO REPORT EMPLOYEE 25 EXPENSES? 26 A. Some 2019 employee expense transactions can also be found in the 27 Company's SAP and TIME applications. These are enterprise-wide systems 14 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 that perform multiple functions for our business areas, including processing 2 some non-labor, employee expenses. 3 4 Q. PLEASE DESCRIBE SAP. 5 A. SAP is a business software package that can integrate all areas of business for 6 financials, manufacturing, logistics, distribution, and so on. The Company uses 7 the SAP software suite for the Company's general ledger as well as work and 8 asset management. SAP applications are used primarily for purchasing, 9 contracts, inventory, accounts payable, labor entry, and design work 10 management. SAP is also the Company's master vendor management 11 reporting system, containing two separate applications, Vendor Invoice 12 Management (VIM) and VIM Nuclear. Specifically, VIM and VIM Nuclear 13 include some employee expense transactions. 14 15 Q. WHAT APPLICATIONS DID SAP REPLACE? 16 A. SAP replaced the Corporate PassPort and Nuclear PassPort applications. SAP 17 was implemented Company-wide by the end of 2017, and no employee 18 expense transactions were reported through Corporate or Nuclear Passport in 19 2019. In total, approximately 800 employee expense transactions were 20 reported through SAP's VIM and about 100 employee expense transactions 21 were reported through VIM Nuclear in 2019. 22 23 Q. PLEASE DESCRIBE TIME. 24 A. TIME is the Company's mainframe application used to record time entries for 25 all employees (both those in bargaining units and those not in bargaining 26 units). TIME is also used to record costs other than wages incurred by the 27 Company's bargaining-unit employees across all business areas (TIME 15 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Expenses). The 2019 TIME Expenses entries for the State of Minnesota 2 Electric Jurisdiction consisted of per diems (57 percent), meal allowances (17 3 percent), mileage (17 percent), site allowance (7 percent), and safety shoes, 4 uniforms, and other similar charges (2 percent). These expenses are processed 5 within the TIME system so that they are properly reported to the Internal 6 Revenue Service and included in the appropriate employees' annual W2 7 statements. 8 9 Q. HOW DO THE TIME EXPENSES RELATE TO THE EMPLOYEE EXPENSE 10 AMOUNT? 11 A. Under applicable collective bargaining agreements, we are required to 12 reimburse bargaining employees for certain expenses those employees incur. 13 The TIME Expenses for per diems, meal allowances, safety shoes, and so 14 on are for those reimbursements. Because these entries reflect cash 15 payments to bargaining unit employees made pursuant to collective bargaining 16 agreements, they are somewhat different in nature from the kinds of expenses 17 contemplated in the Company's Employee Expense Policy or the Employee 18 Expense Statute and defined earlier in my testimony. Nevertheless, they are 19 included in the Employee Expense Amount, because they are coded as 20 employee expenses in our general ledger system and are recoverable O&M 21 expenses. This is consistent with the Company's approach in its last several 22 rate cases. 23 16 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. DID THE COMPANY'S EMPLOYEE EXPENSE REVIEW AND PREPARATION OF 2 EER SCHEDULES ALSO INCLUDE A REVIEW OF 2019 VIM, VIM NUCLEAR, AND 3 TIME TRANSACTIONS? 4 A. Yes. We conducted a thorough review of VIM, VIM Nuclear, and TIME data 5 in order to remove expenses that were considered to be non-recoverable. 6 Summary data from these systems is reported separately in EER Schedules 10, 7 11, and 12. 8 9 C. Internal Controls and Monitoring 10 Q. HOW IS THE COMPANY MONITORING COMPLIANCE WITH THE EMPLOYEE 11 EXPENSE POLICY AND APPROPRIATE REPORTING OF EMPLOYEE EXPENSES? 12 A. We have established several ways to monitor and track appropriate reporting 13 of employee expenses: 1) SumTotal Controls; 2) Compliance and Trend 14 Reporting; and 3) Internal Audits. I will discuss each of these briefly below. 15 16 Q. DOES SUMTOTAL HAVE SYSTEM-BUILT CONTROLS TO FLAG POTENTIALLY 17 NON-COMPLIANT EXPENSE REPORTS? 18 A. Yes. SumTotal advises the approving supervisor and a group within Supply 19 Chain when an expense report may not comply with the Employee Expense 20 Policy. A Supply Chain Administrator will review each flagged expense report 21 and reject it unless it can be corrected to be in compliance with the Company 22 policy and guidelines. A second layer of verification is added by monthly 23 check and balance reviews, which monitor whether the Supply Chain 24 Administrators are accurately rejecting or releasing flagged expense reports. 25 17 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. PLEASE DESCRIBE THE COMPLIANCE AND TREND REPORTING. 2 A. The Supply Chain organization has developed separate compliance and trend 3 reporting components for the Company's Employee Expense Policy. The 4 purpose of the compliance reporting is to collect monthly statistics and 5 provide more detailed analysis of SumTotal data, such as unclear business 6 purposes or untimely completion of expense reports. Compliance reporting 7 allows us to identify reoccurring problem areas, which may indicate that there 8 is a need to provide more direction and education to our employees. This 9 information also helps us to modify and improve our training materials. 10 Trend reporting was established to collect and analyze SumTotal data to 11 identify patterns or issues that would merit changes in the Company's 12 Employee Expense Policy. For example, trend reporting may show that there 13 is a need to add a new expense category or change spending limits for an 14 existing expense category. In addition, we monitor average spending for 15 certain expenses, for example, meals and hotel fees. 16 17 Q. WHAT DOES THE COMPANY DO AFTER IT IDENTIFIES A NON-COMPLIANCE 18 TREND? 19 A. We take the opportunity to better educate our employees, typically in two 20 ways. First, and most often, Supply Chain sends informational emails to all 21 employee expense system users. These informational emails offer very 22 specific instructions on how to correct or clarify issues that were identified as 23 a non-compliance trend. Second, Supply Chain may perform supplemental in- 24 person group training at the request of a Business Unit manager. 25 26 Q. WHAT IS THE MOST RECENT COMPANY AUDIT THAT REVIEWED EMPLOYEE 27 EXPENSE DATA? 18 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 A. The most recent Company audit on employee expenses reviewed a sample of 2 all employee expense data from 2016 and from 2017 through November 30, 3 2017. The Audit Report was issued in March 2018 and focused on verifying 4 that expenses were reimbursed in compliance with the Company policy; 5 assessing whether appropriate controls and reporting tools are in place; 6 analyzing suspicious patterns or anomalies; and, verifying that expense types in 7 SumTotal tie to the appropriate general ledger account. 8 9 Q. WHAT DID THE AUDIT FIND? 10 A. The Audit Report concluded that the Company's system of controls over 11 employee expenses is effective. Although some instances of non-compliance 12 with the Company policy were identified, the number of such instances was 13 minimal and the exceptions insignificant. Examples of non-compliance 14 included splitting transactions, inadequate supporting documentation, and 15 payment of relocation expenses through the employee expense process instead 16 of through SAP. The Audit Report recommended ongoing training and 17 frequent updates to emphasize the approving manager's role in ensuring the 18 necessity and validity of purchases, such as monthly policy highlights. No 19 potentially fraudulent transactions were noted. 20 21 Q. WHEN IS THE COMPANY PLANNING TO CONDUCT THE NEXT AUDIT ON 22 EMPLOYEE EXPENSES? 23 A. The next audit on employee expenses is currently planned to begin in 24 November 2020 and be completed in February 2021, with a final report issued 25 in March 2021. 26 19 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 IV. EMPLOYEE EXPENSE AMOUNT, EMPLOYEE EXPENSE 2 ADJUSTMENT, AND EER SCHEDULES 3 4 Q. WHAT IS THE EMPLOYEE EXPENSE AMOUNT FOR THE TEST YEAR 2021? 5 A. The Employee Expense Amount for the test year 2021 is approximately $16.2 6 million for the State of Minnesota Electric Jurisdiction. This amount is derived 7 from the O&M budgets of our various business areas. The Company does not 8 prepare a separate budget for employee expenses. 9 10 Q. HOW ARE THE BUSINESS AREA BUDGETS PREPARED? 11 A. The Company's budgeting process is a forward-looking projection of projects, 12 costs, and operational needs. Each business area develops its own budget as 13 part of the Company's overall budgeting process, which is described in more 14 detail in the Direct Testimony of Company witness Ms. Melissa L. Ostrom. In 15 general, business area budgets are organized using "cost elements," and certain 16 accounts include planned expenditures for the types of expenses that are listed 17 in the Employee Expense Statute. The sum of the amounts budgeted for 18 these accounts constitutes the Employee Expense Amount for the test year. 19 20 Q. HAS COVID-19 IMPACTED THE AMOUNT OF EMPLOYEE EXPENSES INCURRED 21 BY THE COMPANY IN 2020? 22 A. Yes. The Company expects that employee expenses will be lower in 2020 23 because of COVID-19. As explained above, airfare, lodging, other travel- 24 related expenses, and meals make up a significant portion of the Company's 25 employee expenses. In response to the COVID-19 pandemic, governmental 26 authorities in many jurisdictions across the U.S. imposed restrictions such as 27 barring non-essential travel, closing restaurants, and limiting gatherings such as 20 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 conferences. As a result of these restrictions, our employees have been 2 traveling much less and eating fewer business meals at restaurants. 3 4 Q. IS THE COMMISSION CURRENTLY INVESTIGATING THE FINANCIAL IMPACTS OF 5 COVID-19 ON UTILITIES? 6 A. Yes. The Commission is currently investigating how to track the financial 7 effects of COVID-19 holistically2 and has solicited comments on "how to 8 identify the types of financial impacts that could be considered COVID- 9 related, including cost increases and decreases, revenue increases and 10 decreases, and investments, as well as what off-sets there may be" as well as 11 "information on the financial effects on the utilities of the pandemic."3 The 12 Department emphasized in its comments that it is essential for utilities to track 13 both increases and decreases in costs and revenues, including any reduced 14 travel, entertainment, meals, transportation costs, construction costs, and 15 similar.4 In its September 24, 2020 meeting the Commission approved a 16 methodology to track and defer COVID-19 related expenses, which requires 17 the utilities to also track savings and reduced expenses due to COVID-19. My 18 understanding is that any decreases in employee expenses in 2020 as a result of 19 COVID-19 will be tracked and addressed with the overall financial impacts of 20 COVID-19. As a result, these impacts need not be addressed separately in this 21 rate case. 22 2 In the Matter of an Inquiry into the Financial Effects of COVID-19 on Natural Gas and Electric Utilities, Docket No. E,G999/CI-20-425 and In the Matter of the Request of Minnesota Regulated Gas and Electric Utilities for Authorization to Track Expenses Resulting From the Effects of COVID-19 and Record and Defer Such Expenses Into a Regulatory Asset, Docket No. E, G999/M-20-427. 3 May 22, 2020 ORDER APPROVING ACCOUNTING REQUEST AND TAKING OTHER ACTION RELATED TO COVID-19 PANDEMIC, in the dockets referenced above. 4 Department's July 10, 2020 Comments, in the dockets referenced above. 21 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. DO YOU ANTICIPATE THAT COVID-19 WILL AFFECT THE AMOUNT OF 2 EMPLOYEE EXPENSES INCURRED BY THE COMPANY IN 2021? 3 A. Considering the uncertainty surrounding COVID-19 and its consequences, it 4 is difficult to predict what will happen in 2021. Based on the current COVID- 5 19 trend, however, I expect that employee expenses will be affected in 2021, 6 but it is not possible to quantify the extent of the impact. As explained above, 7 the Company does not have a separate budget for employee expenses, which 8 are instead imbedded in each business area's O&M budget. Any potential 9 reduction in employee expenses in 2021 is accounted for in the overall 10 business area O&M budgets. 11 12 Q. WHAT IS THE EMPLOYEE EXPENSE ADJUSTMENT? 13 A. The Employee Expense Adjustment for the test year 2021 is based on a 14 review of actual 2019 employee expense transactions. The purpose is to 15 identify and remove transactions that are not generally needed for providing 16 utility service and are likely non-recoverable based on our experience in prior 17 rate cases, such as transactions that are inconsistent with our Employee 18 Expense Policy guidelines, related to entertainment or life event celebrations, 19 or have vague business purposes. The transactions that are included in the 20 Employee Expense Adjustment are considered to be representative of such 21 transactions that could occur in 2021 and are therefore subtracted from the 22 Employee Expense Amount. 23 24 Q. WHAT IS THE AMOUNT OF EMPLOYEE EXPENSES THE COMPANY IS 25 REQUESTING TO RECOVER FOR THE TEST YEAR 2021? 26 A. After the Company's proposed Employee Expense Adjustment 27 (approximately $1.6 million) is deducted from the proposed Employee 22 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Expense Amount (approximately $16.2 million), we are requesting recovery of 2 approximately $14.6 million for employee expenses for the State of Minnesota 3 Electric Jurisdiction for the test year 2021. 4 5 Q. HOW DID THE COMPANY PREPARE THE EMPLOYEE EXPENSE AMOUNT FOR 6 MYRP YEARS 2022 AND 2023? 7 A. The Employee Expense Amount for plan years 2022 and 2023 was developed 8 the same way as for the test year 2021, based on the combined amount of 9 employee expenses included in 2022 and 2023 business area budgets. The 10 Employee Expense Amount for the State of Minnesota Electric Jurisdiction is 11 approximately $15.6 million for 2022 and $16.1 million for 2023. 12 13 Q. HOW DID THE COMPANY PREPARE THE EMPLOYEE EXPENSE ADJUSTMENT 14 FOR MYRP YEARS 2022 AND 2023? 15 A. The Employee Expense Adjustment of $1.6 million for 2021 is based on the 16 review of actual expenses from the last full fiscal year, which is currently 2019. 17 To determine the Employee Expense Adjustment for 2022 and 2023, we 18 examined how the Employee Expense Amount (based on business area 19 budgets) changes from 2021 to 2022 and from 2022 to 2023, and then 20 modified the Employee Expense Adjustment to follow proportionally that 21 change. In other words, if the Employee Expense Amount for example 22 increases from 2021 to 2022 by five percent, then we would increase the 23 Employee Expense Adjustment by five percent for 2022. 24 23 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. WHAT IS THE EMPLOYEE EXPENSE ADJUSTMENT FOR THE PLAN YEARS 2022 2 AND 2023? 3 A. The Employee Expense Amount decreases from 2021 to 2022 by 3.6 percent 4 and increases from 2022 to 2023 by 3.3 percent. When these percentages are 5 applied to the 2021 test year Employee Expense Adjustment, it results in an 6 approximately $1.5 million adjustment (after rounding) for the 2022 plan year 7 and an approximately $1.6 million adjustment for the 2023 plan year. 8 9 Q. WHAT IS THE AMOUNT OF EMPLOYEE EXPENSES THE COMPANY IS 10 REQUESTING TO RECOVER FOR PLAN YEARS 2022 AND 2023? 11 A. After the Employee Expense Adjustment is deducted from the Employee 12 Expense Amount, we are requesting recovery of approximately $14.1 million 13 for plan year 2022 and $14.5 million for plan year 2023. Table 1 below 14 summarizes the Employee Expense Amount, Employee Expense Adjustment, 15 and the resulting amount of employee expenses that the Company is seeking 16 to recover for 2021, 2022, and 2023. 17 18 Table 1 19 Employee Expense Amount, Employee Expense Adjustment, and 20 Requested Recovery for 2021, 2022, and 2023 (State of Minnesota 21 Electric Jurisdiction) 22 Year Employee Expense Employee Expense Request for 23 Amount ($ 000's) Adjustment ($ 000's) Recovery ($ 000's) 24 2021 16,168 1,569 14,598 25 2022 15,581 1,512 14,069 26 2023 16,098 1,562 14,535 24 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. PLEASE PROVIDE DATA ON THE EMPLOYEE EXPENSE AMOUNTS AND THE 2 ACTUAL EMPLOYEE EXPENSES FOR THE PAST THREE YEARS. 3 A. Table 2 below provides data on the employee expense amounts (based on 4 business area budgets) and actual employee expenses for 2017-2019 for the 5 State of Minnesota Electric Jurisdiction. This data suggests that the 6 Company's business areas have cumulatively done a reasonably accurate job of 7 budgeting for their employee expenses over the past three years, the total 8 actual employee expenses were within 0.7 percent of the total employee 9 expense amounts. The actuals exceeded the budgeted amounts in 2018 and 10 2019, while the actuals came in under the budgeted amounts in 2017. 11 Employee expenses are somewhat volatile because of external conditions such 12 as weather and variations in airfare and hotel prices, and also fluctuate based 13 on unpredictable Company needs and commitments, such as mutual aid 14 requirements to assist other utilities in national emergencies. In 2020, the 15 actual and forecasted employee expenses will likely be significantly lower 16 because of COVID-19. This is an illustration (albeit extreme) of how actual 17 employee expenses expenditures fluctuate from year to year as a result of 18 conditions beyond the Company's control. Exhibit___(WKH-1), Schedule 6 19 provides additional data by employee expense category for 2017-2019. 20 25 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Table 2 2 Employee Expense Amount vs. Actual Employee Expenses, 2017- 3 2019 (State of Minnesota Electric Jurisdiction)1 4 5 6 2017 7 2018 Employee Expense Amount ($ 000's) 15,170 Actual Employee Expenses ($ 000's) 13,922 $ Variance Over (Under) ($ 000's) (1,248) % Variance Over (Under) (8.2%) 14,558 15,256 698 4.8% 8 2019 15,613 16,495 882 5.7% 9 3-year total 45,340 45,673 333 0.7% 10 11 Q. WHAT ARE THE EER SCHEDULES? 12 A. The Employee Expense Statute requires that a rate case filed by a public utility 13 must include a schedule that separately itemizes certain employee expense 14 categories. This employee expense transaction data must be from the most 15 recently completed fiscal year and include the date, amount, business purpose, 16 and vendor for the expense. After we reviewed all actual 2019 employee 17 expense data and removed items that we believed were not recoverable (e.g., 18 the Employee Expense Adjustment), the remaining transactions were arranged 19 into EER Schedules required by the Employee Expense Statute. A list of the 20 EER Schedules is attached as Exhibit___(WKH-1), Schedule 7. The complete 21 EER Schedules are provided in Volume 3 Required Information, Section IV 22 Other Required Information, Tab 2. 23 26 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 V. EMPLOYEE EXPENSE REVIEW AND DEVELOPMENT OF EER 2 SCHEDULES 3 4 A. Employee Expense Review Process 5 Q. IN GENERAL, HOW DID THE COMPANY REVIEW EMPLOYEE EXPENSES AND 6 DEVELOP THE EER SCHEDULES? 7 A. We followed the same methodology as was used in our last four rate cases: 8 test year 2013 (Docket No. E002/GR-12-961), test year 2014 (Docket No. 9 E002/GR-13-868), test year 2016 (Docket No. E002/15-826), and test year 10 2020 (Docket No. E002/19-564). 11 12 Q. WHAT DATA DID THE COMPANY REVIEW AND USE TO PREPARE THE EER 13 SCHEDULES? 14 A. The Employee Expense Statute requires that we provide employee expense 15 data from our last completed fiscal year, which is 2019. We used the full 12 16 months of 2019 data from SumTotal and any other applicable Company 17 systems (e.g., VIM, VIM Nuclear, and TIME). 18 19 Q. WHAT FIELDS DID THE COMPANY EXTRACT FROM SUMTOTAL? 20 A. While SumTotal contains many other fields, for this case we extracted fields 21 that were: (1) necessary to develop EER schedules that comply with our 22 interpretation of the requirements in the Employee Expense Statute and our 23 commitments in the prior electric rate cases; and (2) helpful in determining if 24 the expense could be allocated to the State of Minnesota Electric Jurisdiction. 25 The raw SumTotal data set includes the corporate credit card transactions and 26 cash reimbursements for all expenses incurred by NSPM and Service 27 Company employees. 27 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. PLEASE DESCRIBE THE PROCESS FOR REVIEWING SUMTOTAL DATA? 2 A. The process to review SumTotal data is largely manual and involves numerous 3 steps and a line-by-line review of transactions. A detailed explanation of this 4 process is provided in Exhibit___(WKH-1), Schedule 8. After extracting the 5 data set described above, we first removed transactions that have no cost 6 assignment or allocation to the State of Minnesota Electric Jurisdiction 7 (restricting the data set to approximately 200,000 line items). I note one 8 exception: we preserved all transaction data for entertainment expenses and 9 dues even if not allocable to the State of Minnesota Electric Jurisdiction. We 10 did so to remain consistent with the EER Schedules provided in our last 11 electric rate case, which included employee entertainment and dues expense 12 transaction data. We have developed a process that allows us to determine the 13 amount of each transaction's jurisdictional allocation. 14 15 From this point, we identified transactions that are not recoverable and are 16 already accounted for below-the-line, or needed to be manually moved below- 17 the-line. Several Company cost element accounts are below-the-line accounts 18 and include expenses related to lobbying, non-recoverable recognition, 19 corporate tickets, and other similar deductions. These non-recoverable, below- 20 the-line transactions were excluded from a further review. 21 22 Q. WHAT WAS THE NEXT STEP IN THE SUMTOTAL REVIEW PROCESS? 23 A. Next, we searched the remaining transactions (approximately 196,000 lines) 24 for 124 key words, and we also searched them for vague business purposes 25 and other criteria, to determine if there were transactions inconsistent with the 26 Employee Expense Policy or our prior rate case commitments or that were 27 not necessary for the provision of utility service. Our proposed Employee 28 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Expense Adjustment consists of transactions identified through this effort. 2 Specifically, we included in the adjustment items that were: 3 · Identified by our key word search; 4 · Considered to have vague business purposes; 5 · For meals exceeding $65 per person; 6 · For business meals that included only Company employees; 7 · Inconsistent with the guidelines in our Employee Expense Policy; and 8 · Identified as generally not being needed for the provision of utility 9 service. 10 11 Q. PLEASE DESCRIBE THE KEY WORD SEARCH. 12 A. Based on our past experience, we developed a list of 124 key words that was 13 used to identify transactions that may not be appropriate for rate recovery. 14 The list was developed specifically to capture expenditures related to sporting 15 and entertainment events, recreation, celebrations, recognitions, life events, 16 international travel and lobbying. The key word list is provided in Table 2 to 17 Exhibit___(WKH-1), Schedule 8. Transactions initially identified through the 18 key word search were manually reviewed, line-by-line, to determine if the 19 transaction qualified as a recoverable employee expense. Some expenses 20 identified through the key word search are "false positives," which means they 21 are appropriate for recovery although they contain a key word. For example, 22 expenses incurred for vendors such as Holiday Inn Express or Holiday Station 23 Store could be recoverable although matching the search word "holiday." We 24 identified approximately 33,000 transactions through the key word search and 25 approximately 12,200, or 37 percent, of these transactions were included in the 26 Employee Expense Adjustment. The amount of adjustment based on the key 27 word search is approximately $585,000. 29 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. PLEASE DESCRIBE HOW THE COMPANY SEARCHED FOR SUMTOTAL 2 TRANSACTIONS WITH VAGUE BUSINESS PURPOSES. 3 A. We first manually reviewed each transaction to assess if the business purpose 4 field, by itself, provided an adequate description to determine the business 5 purpose. If the business purpose was vague, such as "dinner," "travel," or 6 "meeting," we manually reviewed other data fields and examined acronyms 7 and abbreviations. If the combined documentation was not sufficient to 8 determine an adequate business purpose, the transaction was flagged for 9 removal. A representative (non-exhaustive) list of 229 acronyms that are 10 commonly used by our employees is provided in Table 3 to Exhibit 11 ___(WKH-1), Schedule 8. The amount of adjustment based on vague business 12 purposes is approximately $73,000. 13 14 Q. DID THE COMPANY IDENTIFY EVERY SUMTOTAL TRANSACTION WITH A 15 VAGUE BUSINESS PURPOSE? 16 A. Identifying vague business purposes is somewhat subjective. While we have 17 made our best effort to identify these transactions, there could be transactions 18 with business purposes others might consider vague. Our Employee Expense 19 Policy provides guidelines for the appropriate documentation of employee 20 expenses, and our employees provide business purposes they believe are 21 reasonable. While an approving manager may find a business purpose 22 reasonable based on knowledge of the work being done by an employee, this 23 business purpose may appear vague to an outside party. We believe that there 24 is always some judgment and subjectivity involved in assessing the business 25 purpose, and do not think that perfection is possible, nor should it be the 26 standard applied. In our review of employee expenses, we conducted a 27 thorough search for vague business purposes and reviewed acronyms and 30 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 abbreviations included in business purposes when necessary. We believe our 2 effort and the resulting Employee Expense Adjustment are consistent with 3 our commitment in the 2011 rate case. 4 5 Q. ARE THERE MEALS GREATER THAN $65 PER PERSON, PER DAY IN THE EER 6 SCHEDULES? 7 A. No. We are not seeking recovery for these transactions, and the EER 8 Schedules do not include meals in excess of $65 per person per day. Our 9 Employee Expense Policy guidelines require that an employee should not 10 charge for more than $65 per person, per day for business or travel meals. We 11 have continued to improve compliance with this guideline, but we still 12 identified instances where the meal transactions in SumTotal exceeded the 13 allowable amount. These transactions (approximately $22,000) are included in 14 the Employee Expense Adjustment. 15 16 Q. ARE BUSINESS MEALS THAT INCLUDED ONLY COMPANY EMPLOYEES INCLUDED 17 IN THE EER SCHEDULES? 18 A. No. Although we believe there are instances where business meals among 19 employees are necessary, we are not seeking recovery for these transactions 20 and they are also excluded from the EER Schedules, consistent with past 21 practice. Approximately $567,000 of employee-only business meals reported 22 through SumTotal are included in the Employee Expense Adjustment. 23 24 Q. PLEASE DESCRIBE THE REST OF THE SUMTOTAL TRANSACTIONS INCLUDED IN 25 THE EMPLOYEE EXPENSE ADJUSTMENT. 26 A. The rest of the Employee Expense Adjustment is comprised of SumTotal 27 transactions that are otherwise inconsistent with our Employee Expense 31 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Policy guidelines; do not pertain to the State of Minnesota Electric 2 Jurisdiction; or we believe are not needed to provide utility service. Based on 3 our past experience, we conducted a manual line and field review to identify 4 these types of expenses, and any transactions identified by the review were 5 flagged for removal. Approximately $278,000 of flagged SumTotal 6 transactions are included in the Employee Expense Adjustment. 7 8 Q. ARE EXPENSES FOR INTERNATIONAL TRAVEL INCLUDED IN THE EER 9 SCHEDULES? 10 A. Yes, depending on the business purpose. Our Employee Expense Policy 11 recognizes that international travel is sometimes necessary for conducting 12 Company business, for example, to attend industry trainings and vendor 13 supplier meetings; to audit manufacturing processes at vendors' locations; and, 14 to ensure safe operation of our nuclear facilities. These types of legitimate and 15 necessary expenses are included in the EER Schedules and excluded from the 16 Employee Expense Adjustment. 17 18 Q. WHAT IS THE TOTAL AMOUNT OF ADJUSTMENT THE COMPANY MADE TO 19 SUMTOTAL TRANSACTIONS? 20 A. Based on the review process described above, we made a total adjustment of 21 approximately $1.541 million to SumTotal employee expense transactions. A 22 summary table of these adjustments is included in Exhibit___(WKH-1), 23 Schedule 8, p. 11. 24 32 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. HOW DID THE COMPANY REVIEW EMPLOYEE EXPENSES RECORDED IN OTHER 2 SYSTEMS THAN SUMTOTAL? 3 A. As explained in Section III.B above, VIM, VIM Nuclear, and TIME 4 applications include some 2019 employee expense transactions. In these 5 applications, the descriptive fields available are less extensive than those 6 provided within SumTotal. We identified employee expenses by looking at 7 accounting codes, vendor name, description, and other available transactional 8 data fields. For the identified employee expense transactions, we conducted a 9 line-by-line review to remove transactions that we believe are non-recoverable, 10 similar to the SumTotal review described above. The process to review VIM, 11 VIM Nuclear, and TIME expense data is described in more detail in 12 Exhibit___(WKH-1), Schedule 8. 13 14 Q. WHAT ADJUSTMENTS DID THE COMPANY MAKE TO VIM, VIM NUCLEAR, AND 15 TIME TRANSACTIONS? 16 A. Based on our review, we made a total adjustment of approximately $29,000 to 17 VIM employee expense transactions. We did not make any adjustments to 18 VIM Nuclear or TIME data. 19 20 Q. DO YOU THINK THE RESULTING $1.6 MILLION EMPLOYEE EXPENSE 21 ADJUSTMENT FOR THE STATE OF MINNESOTA ELECTRIC JURISDICTION IS 22 REASONABLE? 23 A. Yes. Our process to identify employee expense transactions for exclusion was 24 rigorous and consistent with the commitments we have made in past rate 25 cases. This adjustment ensures a reasonable and appropriate amount of 26 employee expenses are included in 2021, 2022, and 2023. 27 33 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. ARE TRANSACTIONS THAT MAKE UP THE $1.6 MILLION EMPLOYEE EXPENSE 2 ADJUSTMENT INCLUDED IN THE EER SCHEDULES? 3 A. No. The EER Schedules do not include any of the transactions that make up 4 the $1.6 million Employee Expense Adjustment. Once the expenses 5 comprising the Employee Expense Adjustment were removed, the remaining 6 data O&M employee expense transactions was sorted to create the EER 7 Schedules corresponding to the categories set forth in the Employee Expense 8 Statute. 9 10 B. Details Regarding EER Schedules 11 Q. PLEASE DESCRIBE THE INFORMATION REPORTED FOR THE TOP TEN HIGHEST 12 PAID EMPLOYEES AND OFFICERS AS REQUIRED BY THE EMPLOYEE EXPENSE 13 STATUTE? 14 A. EER Schedules 5A-5J comply with the Employee Expense Statute 15 requirement that we provide itemized employee expense information for the 16 ten highest paid officers and employees for 2019, the most recently completed 17 fiscal year. 18 19 The Employee Expense Statute also requires that we provide compensation 20 information for the individuals on the top ten compensated list. EER 21 Schedule 5 includes the State of Minnesota Electric Jurisdiction 2019 actual 22 and 2021-2023 budgeted compensation information for the top ten highest 23 paid officers and individuals. Company witness Ms. Ruth K. Lowenthal 24 describes in her Direct Testimony the employee compensation costs we 25 propose to recover. 26 34 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. IS THE COMPANY REQUESTING RECOVERY OF CORPORATE AVIATION 2 EXPENSES? 3 A. No. EER Schedule 8 provides expenses related to corporate aviation, as 4 required by the statute, but we are not requesting recovery for them and they 5 are excluded from the 2021 test year amount. I note that EER Schedule 8 also 6 includes any food, beverage, lodging, and other travel transactions for the 7 corporate aircraft pilots. These aviation expenses are excluded from the test 8 year amount as well. 9 10 Q. IS THE COMPANY REQUESTING RECOVERY FOR ANY LOBBYING-RELATED 11 EXPENSES? 12 A. No, we do not request recovery of any lobbying or lobbying-related expenses, 13 and these are excluded from the 2021 test year amount. 14 15 Q. WHAT HAS THE COMPANY DONE TO ENSURE THAT THERE ARE NO LOBBYING 16 OR LOBBYING-RELATED EXPENSES IN THE EER SCHEDULES? 17 A. Lobbying-related costs charged to appropriate internal order accounts are 18 recorded as below-the-line expenses and excluded from the EER Schedules. 19 Our key word search also included lobbying-related words (e.g., lobby, legis, 20 political, election, PAC, senat, and repr) to identify any other transactions that 21 might be related to lobbying and capture them in the Employee Expense 22 Adjustment. Additionally, for those employees who lobby from time to time, 23 we reviewed each of their transactions and removed those that appeared to be 24 for lobbying or lobbying-related activities on behalf of the Company. 25 35 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. ARE ANY OTHER CATEGORIES OF EMPLOYEE EXPENSES EXCLUDED FROM THE 2 EER SCHEDULES? 3 A. Yes. Spending for life events such as funerals, weddings, and birthdays is 4 excluded from the EER Schedules. All expenses charged in 2019 to the Life 5 Event account were included in the Employee Expense Adjustment. In 6 addition, our key word search review of 2019 transactions included life event- 7 related words (e.g., floral, flowers, funeral, bereavement, birthday, wedding, 8 and baby) to identify other transactions that were not recorded to the Life 9 Event account so that these transactions could be included in the Employee 10 Expense Adjustment. Similarly, expenses that were determined to be for 11 career event celebrations such as meals for retirement, promotion, or 12 anniversary parties are included in the Employee Expense Adjustment. 13 14 Other expense categories that we are not requesting recovery for are alcohol 15 and entertainment expenses. Any alcohol portion of a meal expense must be 16 itemized separately in SumTotal. The key word search also had terms to 17 identify any other expenses that might be alcohol-related. These were all 18 excluded from the EER Schedules. EER Schedule 3 lists all recreation and 19 entertainment expenses, as required by the Employee Expense Statute. These 20 expenses are recorded below-the-line and we are not requesting recovery for 21 them. EER Schedule 7 lists all gift expenses, and some of these are typically 22 recovered from rates (e.g., performance-based and safety recognition) and 23 some are included in the Employee Expense Adjustment (e.g., wedding or 24 birth gift). Finally, mobile device expenses are not subject to the reporting 25 requirements in the Employee Expense Statute and therefore they are 26 excluded from the EER Schedules. 27 36 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. ARE CERTAIN EMPLOYEE RECOGNITION EXPENSES INCLUDED IN THE EER 2 SCHEDULES? 3 A. Yes. We use a vendor-based recognition program branded as Xcelebrate to 4 administer recognition awards, and these expenses are included in the EER 5 Schedules. The Xcelebrate program is used to recognize excellent work 6 performance and accomplishments. Awards must be approved by leadership, 7 and approval levels vary depending on the award value from manager through 8 Vice President. Xcelebrate awards are received in points, which can be used 9 for merchandise or gift cards through an online catalog. The highest level of 10 award is equivalent to $200, and this level requires both manager and Vice 11 President approval. A nomination wizard within Xcelebrate is available to help 12 determine the appropriate award level. Xcelebrate awards may also be used to 13 recognize excellent work performance that is related to safety. 14 15 In addition, the Xcelebrate program is used to recognize years of contribution 16 at five-year intervals as well as retirement. Eligible employees are invited to 17 select a gift from the applicable anniversary/retirement catalog. Transactions 18 administered through the Xcelebrate platform were included in our employee 19 expense review. We continue to believe that employee recognition and 20 appreciation help foster a collegial working environment essential to achieving 21 a high level of productivity. 22 23 Q. ARE SAFETY-RELATED RECOGNITION EXPENSES INCLUDED IN THE EER 24 SCHEDULES? 25 A. Yes. Safety-related gifts and other incentives are included in the EER 26 Schedules, consistent with past practice. Safety-related accomplishments may 27 also be recognized outside the Xcelebrate program. For example, Nuclear 37 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Operations and other business areas may recognize a group or plant for a 2 specific achievement, such as successful and safe completion of a large project 3 or reaching a major milestone without an injury. All safety-related recognition 4 awards, incentives, meals, and gifts must be approved by a manager and/or a 5 safety committee. Safety recognition expenses were included in our employee 6 expense review. Safety recognition is a necessary and reasonable expense to 7 provide utility service one of the Company's fundamental goal is to ensure 8 and enhance the safety of our employees and customers. 9 10 Q. EER SCHEDULE 6 INCLUDES A ROW FOR "DUES & MEMBERSHIPS" ARE 11 THESE INCLUDED IN THE EMPLOYEE EXPENSE AMOUNT? 12 A. That row in EER Schedule 6 includes three types of dues: Professional 13 Association Dues, Chamber of Commerce Dues, and Social Services Dues. 14 Professional Association Dues are incurred by our individual employees for 15 memberships in professional organizations in their respective fields. The 16 portion of Professional Association dues that is not considered lobbying is 17 recoverable and included in the test year Employee Expense Amount. 18 Chamber of Commerce Dues are corporate expenses and they are excluded 19 from the Employee Expense Amount. We request recovery for the non- 20 lobbying portion of these dues, which is supported in Mr. Halama's Direct 21 Testimony. Social Services Dues are corporate expenses, recorded below-the- 22 line, and excluded from the 2021 test year. 23 24 Q. WHAT EMPLOYEE EXPENSE DATA IS INCLUDED IN EER SCHEDULES 10, 11, 25 AND 12? 26 A. These schedules contain summary employee expense data from VIM (EER 27 Schedule 10), VIM Nuclear (EER Schedule 11), and TIME (EER Schedule 38 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 12). Per our commitment in the 2011 rate case, we have provided summary 2 data instead of complete transaction details. 3 4 Q. ARE THERE ANY LIMITATIONS IN THE PROCESS USED TO DEVELOP THE EER 5 SCHEDULES OR THE SCHEDULES THEMSELVES? 6 A. We believe our EER Schedules comply with the requirements in the 7 Employee Expense Statute. However, I note that the process we use to 8 develop the EER Schedules is almost entirely manual and requires that our 9 employees analyze and review many thousands of lines of data. SumTotal 10 does not have the functionality to automatically generate reports that comply 11 with the Employee Expense Statute requirements. Therefore, the 12 development of EER Schedules continues to be a manual effort that requires 13 judgment. 14 15 Q. CAN YOU RECONCILE THE EER SCHEDULES TO THE TEST YEAR 2021 REVENUE 16 REQUIREMENT FOR EMPLOYEE EXPENSES? 17 A. No. The EER Schedules are based on the actual 2019 employee expense 18 transactions. The test year revenue requirement of approximately $14.6 19 million is based on the 2021 budgeted expenses by business areas. As a result, 20 a direct reconciliation of the 2019 EER Schedules to the 2021 test year 21 amount is not possible because of the different time periods. 22 23 Q. CAN YOU SUM UP THE 2019 EER SCHEDULES SO THAT THEY MATCH THE 24 ACTUAL 2019 EMPLOYEE EXPENSES IN THE COMPANY'S GENERAL LEDGER? 25 A. No, for several reasons. For example, the transactions that make up the 26 Employee Expense Adjustment of $1.6 million are included in the general 27 ledger but excluded from the EER Schedules. Also, several EER Schedules 39 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 have duplicative employee expenses. For instance, transactions in EER 2 Schedule 1A (Vice President and Above Travel and Meal) are also included in 3 EER Schedule 1 (Travel and Lodging) and EER Schedule 2 (Meal Expenses). 4 Similarly, employee expense transactions in EER Schedules 5A-5J (Top Ten 5 Compensated) are also included in the other EER Schedules. 6 7 VI. FLEET CAPITAL INVESTMENTS 8 A. Overview 9 Q. WHAT IS THE PURPOSE OF THIS SECTION IN YOUR TESTIMONY? 10 A. I support the Company's capital budget for the Supply Chain business area's 11 Fleet organization. The Fleet organization is responsible for planning, 12 procuring, maintaining, and retiring the Company's fleet assets. By fleet assets, 13 I mean the fleet of cars, trucks, trailers, and construction equipment, and 14 related assets such as garages and fuel depots, that the Company uses to 15 support its provision of safe and reliable service. 16 17 Q. PLEASE DESCRIBE THE CENTRALIZATION OF FLEET CAPITAL TO SUPPLY 18 CHAIN'S FLEET ORGANIZATION. 19 A. Management of the capital budget for fleet investments was centralized within 20 Supply Chain's Fleet organization in November 2018. Prior to this 21 centralization, each operational business area was responsible for budgeting 22 their own fleet capital investments. Following this centralization, the Fleet 23 organization became responsible for managing the capital fleet budget for all 24 business areas across Xcel Energy's operational companies, including 25 replacement, maintenance, and repairs for existing fleet vehicles and 26 equipment. 27 40 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. WHAT ARE THE BENEFITS OF CENTRALIZING THE MANAGEMENT AND 2 BUDGETING FOR FLEET UNDER SUPPLY CHAIN? 3 A. Centralizing the management responsibilities to one unit within Supply Chain 4 creates efficiencies, harmonizes long-term planning, and optimizes the 5 purchase and maintenance of the Company's overall fleet. The Fleet 6 organization works closely with each business area to ensure a strategic 7 approach that provides the appropriate number of safe and reliable Company 8 vehicles and equipment. 9 10 As a result of this centralization, we have also been able to improve the 11 process to identify aged fleet vehicles and equipment that need replacement. 12 The Fleet organization uses the total cost of ownership model to identify 13 those fleet assets that need to be replaced. Generally speaking, the worst fleet 14 assets based on age, miles, and hours are replaced first. This means that in any 15 year, the most need may be concentrated to a single business area or 16 operational company, and as a result, capital budgets for fleet replacements 17 may fluctuate from year-to-year. 18 19 Q. DO THE CHANGES DISCUSSED ABOVE CENTRALIZATION OF FLEET CAPITAL 20 AND TOTAL COST OF OWNERSHIP MODEL HAVE OTHER IMPACTS? 21 A. Yes. Because of the organizational change, it is difficult to analyze cost trends 22 and compare the 2020 forecast and 2021-2023 budgets to past years' actual 23 expenses, which were tracked by individual business areas. However, going 24 forward, centralization of Fleet will make it easier to project future costs and 25 to compare them to past actuals because we are now using consistent 26 reporting categories and practices across all business areas. Additionally, the 27 process change to use the total cost of ownership model means that for one 41 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 jurisdiction or business area, the budget for fleet replacements may vary from 2 one year to another. We believe this is an improvement on prior practices 3 because we will be making more data-driven decisions regarding repairs and 4 replacements for our fleet assets. 5 6 Q. PLEASE DESCRIBE THE COMPANY'S FLEET FUNCTIONS IN THE STATE OF 7 MINNESOTA. 8 A. The Company could not accomplish our core service providing electricity to 9 customers without reliable fleet assets and equipment. The construction, 10 maintenance, and repair of the electric system necessitates constant travel 11 across Minnesota that requires the use of cars, trucks, and other equipment. 12 We also rely on a variety of different types of construction equipment to 13 perform our daily work. Further, our ability to swiftly and safely respond to 14 storm and other emergencies hinges on our crews having reliable fleet vehicles 15 and equipment. To that end, the Company maintains a fleet of approximately 16 2,141 vehicles and equipment to support our Distribution, Transmission, 17 Energy Supply, Gas, and Nuclear business areas in Minnesota. These fleet 18 assets include various types of cars, trucks, trailers, and construction 19 equipment. We also maintain 14 garages in Minnesota, where we inspect and 20 repair fleet vehicles and equipment. Additionally, we own and operate 10 21 fueling depots in Minnesota. We operate our own fueling depots to enhance 22 crew efficiencies, to ensure access to diesel fuel for emergency operations, and 23 to accommodate vehicles that cannot use commercial retail fueling stations 24 due to size or other restrictions. 25 42 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. HOW DOES THE FLEET ORGANIZATION CATEGORIZE CAPITAL INVESTMENTS 2 FOR FLEET? 3 A. We categorize fleet capital investments into the following groups: 4 · Fleet Asset Replacements: investments to replace aging and retiring 5 vehicles, trailers, and construction equipment. 6 · Fleet Asset Additions: incremental investments in additional fleet units to 7 meet business area needs for additional crews hired or specific unique 8 work tasks. 9 · Fleet Repairs: investments to repair existing fleet assets to extend their 10 useful life. 11 · Fueling Depots: investments for replacing infrastructure at Company- 12 owned fueling stations. 13 · Garage Tools: investments for tools needed to inspect and repair fleet 14 assets, such as lifts, jacks, oil distribution systems, exhaust systems, and 15 other similar mechanical tools. 16 17 Q. WHAT ARE THE BUDGETED CAPITAL ADDITIONS FOR THE FLEET 18 ORGANIZATION FOR 2021-2023 (STATE OF MINNESOTA ELECTRIC 19 JURISDICTION)? 20 A. Table 3 below shows the actual fleet capital additions by business area for 21 2017-2019; forecasted capital additions for 2020; and budgeted capital 22 additions for 2021-2023. The budgeted capital additions for the Fleet 23 organization total $18.3 million in 2021, $19.3 million in 2022, and $18.7 24 million in 2023 for the State of Minnesota Electric Jurisdiction. I will discuss 25 the reasons for the increase in these fleet investments as compared to historic 26 investments in the next section of my testimony. 27 43 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Table 3 2 Actual and Budgeted Fleet Capital Additions by Business Area 3 (State of Minnesota Electric Jurisdiction) 4 2017 2018 2019 2020 2021 2022 2023 5 (in $ 000's) Actual* Actual* Actual Forecast Budget Budget Budget 6 Distribution 15,537 12,342 4,061 12,871 12,201 11,100 9,329 7 Transmission 4,825 5,435 3,652 4,728 2,906 5,141 6,971 8 Energy 9 Supply / 813 384 - 267 1,046 1,257 1,292 Nuclear 10 Common 11 (Fleet, 12 materials, outdoor - lighting, 13 facilities, etc.) - 804 1,300 2,177 1,805 1,078 14 Total 21,176 18,161 8,518 19,165 18,330 19,304 18,669 15 * The management of the capital budget for fleet investments was centralized within Supply Chain's Fleet organization in November 2018. Actual fleet capital additions for 2017 and 2018 in 16 Table 3 are for NSPM Electric, including Minnesota, North Dakota, and South Dakota. 17 18 Q. PLEASE EXPLAIN WHY 2019 CAPITAL ADDITIONS ARE SIGNIFICANTLY LOWER 19 THAN 2017-2018 ACTUALS AND 2021- 2023 BUDGET? 20 A. As I discussed above, we budget for Fleet investments across the entire Xcel 21 Energy enterprise using the total cost of ownership model. This means that in 22 a particular year, one jurisdiction or one business area may require greater 23 investments in order to make the necessary fleet replacements required by the 24 total cost of ownership model. In 2019, Fleet Asset Management assessed the 25 fleet portfolio and determined that there was a need to increase our capital 26 investments to replace aged fleet assets for the gas operations in our Colorado 27 jurisdiction and as a result, capital investments were reduced for the State of 44 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Minnesota Electric Jurisdiction. After addressing these Colorado assets in 2 2019, the Fleet organization is now focusing on reducing the age of our 3 Minnesota electric fleet over the term of this multi-year rate plan and beyond. 4 Additionally, I note that the fleet capital actuals for 2017 and 2018 are for 5 NSPM Electric, (including Minnesota, North Dakota, and South Dakota); 6 whereas 2019 actuals, 2020 forecast, and 2021-2023 budgets represent only the 7 State of Minnesota Electric Jurisdiction. 8 9 Q. PLEASE PROVIDE AN OVERVIEW OF THE MAJOR PLANNED CAPITAL ADDITIONS 10 FOR THE FLEET ORGANIZATION FOR 2021-2023. 11 A. As Table 4 below displays, Fleet Asset Replacements are by far the largest 12 category of capital additions, comprising approximately 96 percent of the 13 annual budget for 2021-2023 for the State of Minnesota Electric Jurisdiction. 14 As discussed in greater detail below, over the term of this multi-year rate plan, 15 we will be making increasing capital investments to replace aged fleet assets to 16 decrease maintenance costs and to improve performance. Fueling Depots are 17 our second largest category of capital additions, followed by Fleet Repairs and 18 Garage Tools. Exhibit___(WKH-1), Schedule 9 provides further details of 19 Fleet capital additions by account for the State of Minnesota Electric 20 Jurisdiction. 21 45 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Table 4 2 Actual and Budgeted Fleet Capital Additions by Cost Category 3 (State of Minnesota Electric Jurisdiction) 4 2017 2018 2019 2020 2021 2022 2023 5 (in $ 000's) Actual* Actual* Actual Forecast Budget Budget Budget 6 Fleet Asset Replacements 7 and Fleet 20,846 17,567 7,379 18,389 17,286 18,539 18,176 8 Asset Additions 9 Fueling Depots - - 816 425 592 313 41 10 Fleet Repairs 240 116 264 209 200 200 200 11 Garage Tools 89 478 59 142 252 252 252 12 Total 21,176 18,161 8,518 19,165 18,330 19,304 18,669 13 * The management of the capital budget for fleet investments was centralized within Supply Chain's Fleet organization in November 2018. Actual fleet capital additions for 2017 and 2018 in Table 4 are 14 for NSPM Electric including Minnesota, North Dakota, and South Dakota. 15 16 B. Fleet Capital Additions by Category 17 1. Fleet Asset Replacements and Additions 18 19 Q. WHAT INVESTMENTS ARE PLANNED FOR FLEET ASSET REPLACEMENTS AND 20 FLEET ASSET ADDITIONS CATEGORY OVER THE TERM OF THE MULTI-YEAR 21 RATE PLAN? 22 A. For 2021 to 2023, we are not forecasting any incremental Fleet Asset 23 Additions. However, we have budgeted $17.3 million for Fleet Asset 24 Replacements in 2021, $18.5 million in 2022, and $18.2 million in 2023 for the 25 State of Minnesota Electric Jurisdiction. These budgeted amounts for 2021 26 include the replacement of 34 passenger vehicles, 19 light duty vehicles, 133 46 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 medium duty / heavy duty trucks, 25 trailers, and 26 construction equipment. 2 Similar types of fleet replacements will be made in 2022 and 2023. 3 4 Q. ARE ANY OF THESE FLEET VEHICLES BEING REPLACED WITH ELECTRIC 5 VEHICLES? 6 A. Yes. Of the 34 passenger vehicles that will be replaced in 2021, 15 will be 7 replaced with plug-in hybrid electric vehicles (PHEVs). In 2022, we plan to 8 replace 20 additional passenger vehicles with PHEVs. By 2023, all sedans in 9 our existing fleet will be replaced by PHEVs. Replacing our current gas-only 10 powered sedans with PHEVs will provide benefits in terms of helping to cut 11 carbon emissions and lowering fuel and maintenance costs. 12 13 Q. HOW DOES THE COMPANY DETERMINE WHICH OF ITS FLEET ASSETS NEED TO 14 BE REPLACED IN A GIVEN YEAR? 15 A. The Fleet organization makes decisions on replacing fleet assets across the 16 Company's operational companies using the total cost of ownership model, 17 which takes into account the following inputs: age, the number of miles, total 18 hours, repair costs, maintenance costs, the costs of repair parts, and labor 19 costs for repairs of each fleet unit. These inputs track all costs associated with 20 owning, operating, repairing, and maintaining our fleet vehicles during their 21 entire life span. 22 23 Q. HOW IS THE TOTAL COST OF OWNERSHIP MODEL USED TO DEVELOP THE 24 BUDGET FOR FLEET ASSET REPLACEMENTS? 25 A. Each year, the Company examines the total cost of ownership for each of our 26 existing fleet assets to determine which fleet needs to be replaced in that year. 27 In particular, a fleet unit is identified for replacement when the costs of 47 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 owning, operating, repairing, and maintaining a fleet unit exceed the average 2 cost of replacing that unit or when customer service is negatively impacted 3 due to increased instances of breakdowns. This condition-based assessment 4 process means that in one year, the most need for replacing fleet assets may be 5 within one operational company or within one business area. As a result, the 6 annual budget for fleet asset replacements for a Company jurisdiction may 7 fluctuate. 8 9 Q. WHY IS IT IMPORTANT TO REPLACE AGING FLEET ASSETS WHEN THESE 10 CRITERIA ARE MET? 11 A. Replacing our fleet in accordance with these criteria both reduces the total 12 overall cost to operate and maintain the Company's fleet as well as 13 maintaining the reliability and safety of our fleet assets. 14 15 Age is the single biggest driver of maintenance and repair costs for fleet assets. 16 The cost to repair and maintain older fleet assets is much higher than newer 17 assets as they tend to require more frequent and more extensive maintenance 18 and repairs. As a result, it is important to track the maintenance and repair 19 costs of aging fleet assets to make sure that we replace fleet when the costs of 20 these repairs exceed replacement costs. 21 22 Older fleet assets are also not as reliable as newer fleet assets and this can 23 impact customer service since our crews rely on these vehicles and equipment 24 to perform their work. Further, older fleet assets are not as safe as newer 25 assets as they are not equipped with the latest safety technology and have a 26 higher risk of catastrophic component failures. Newer fleet assets also have 48 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 improved fuel economy as compared to older vehicles, thus providing fuel 2 savings. 3 4 Q. WHAT IS DRIVING THE INCREASED INVESTMENT IN FLEET ASSET 5 REPLACEMENTS OVER THE TERM OF THE MULTI-YEAR RATE PLAN? 6 A. The amounts that we have budgeted for Fleet Asset Replacements for 2021- 7 2023 were developed based on the results of the total cost of ownership 8 model. The total cost of ownership model determines the optimal financial 9 age to replace aged fleet assets before they catastrophically fail or cause 10 unnecessary repairs to a fleet unit that is past its ideal replacement age. The 11 current average age of all of our Fleet is 7.5 years. Based on the total cost of 12 ownership model and industry benchmarking, we have determined that the 13 optimum average age of our fleet assets should be 5.7 years. In order to lower 14 the average age of our fleet, we plan to make increased investments in fleet 15 asset replacements starting in 2021 and continuing through 2023. 16 Additionally, as noted above, the Company is replacing certain vehicles with 17 PHEVs. 18 19 2. Fueling Depots 20 Q. WHAT INVESTMENTS ARE PLANNED IN THE FUELING DEPOT CATEGORY OVER 21 THE TERM OF THE MULTI-YEAR RATE PLAN? 22 A. We will be upgrading and installing new fuel tanks, fuel card readers, pumps 23 and upgrading all electrical systems to operate these facilities. The majority of 24 our investments between 2021 and 2023 relate to replacement of underground 25 fuel tanks with new above ground fuel tanks. We began this project in 2018 in 26 the State of Minnesota and anticipate that this work will be completed in 2022. 27 49 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. WHY DOES THE COMPANY NEED TO REPLACE THESE UNDERGROUND FUEL 2 TANKS? 3 A. The underground fuel storage tanks at our fueling depots are 30-50 years old 4 and have reached the end of their useful life both mechanically and 5 environmentally. They are being replaced with above-the-ground storage tanks 6 that minimize environmental risks. We completed the replacement of four 7 fueling stations in 2018 and two in 2019 in Minnesota. We plan to complete 8 the replacement of three additional fueling depots by the end of 2020 and plan 9 to replace three additional fueling depots in 2021, and one additional fueling 10 depot in 2022. 11 12 Q. HOW WAS THE BUDGET FOR FUELING DEPOTS FOR 2021-2023 DETERMINED? 13 A. As noted above, the majority of our budget for fueling depots over this time 14 period relates to the replacement of our underground fuel tanks, fuel 15 dispensers, card readers and all associated electrical cost and restoration work 16 with this project. We developed our budget for this work based on our actual 17 costs to replace these underground storage tanks from 2018 and 2019 and 18 then multiplied that cost by the number of fueling depot replacements 19 planned for each year. 20 21 Q. WHY ARE THERE NO CAPITAL ADDITIONS IN THE FUELING DEPOT CATEGORY 22 PRIOR TO 2019? 23 A. Prior to the re-organization of Fleet under Supply Chain in 2019, Fueling 24 Depots was not a separate capital cost category, and these costs were included 25 in the Garage Tools category. In fact, the majority of the 2018 capital 26 additions for Garage Tools are related to upgrading fueling depot 50 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 infrastructure. Beginning 2019, capital costs related to fueling depot upgrades 2 have been budgeted as a separate cost category. 3 4 3. Fleet Repairs 5 Q. WHAT INVESTMENTS ARE PLANNED FOR FLEET REPAIRS OVER THE TERM OF 6 THE MULTI-YEAR RATE PLAN? 7 A. For 2021-2023, we have budgeted $ 200,000 per year for Fleet Repairs. Repair 8 costs are unpredictable and fluctuate annually, based on the number and type 9 of vehicles and equipment that fail in any given year. Actual repair costs are 10 higher for larger trucks and more complex work. 11 12 Q. HOW WAS THE BUDGET FOR FLEET REPAIRS FOR 2021-2023 DETERMINED? 13 A. We developed the budget for fleet repairs based in part on historic actuals as 14 well as taking into account the current age of our fleet. As I discussed, the 15 average age of our fleet vehicles is currently on the older side, with an average 16 age of 7.5 years. While we are working to reduce the age of these fleet 17 vehicles by making increased investments in fleet replacements, these fleet 18 vehicles will still require necessary repairs to keep them running until they can 19 be replaced. As a result, our budget for fleet repairs is set higher than the 20 historic costs to account for the older nature of our current fleet. 21 22 Q. WHY ARE 2018 FLEET REPAIR COSTS LOWER THAN BOTH 2017 AND 2019 23 ACTUAL COSTS? 24 A. As noted above, prior to 2019 Fleet capital was budgeted by each individual 25 business area using different categories of costs than are used now. As a result, 26 the historical actual expenses may not capture all of the capital additions for 27 fleet repairs. We expect, going forward, actuals will generally align with 51 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 budgeted amounts depending on the number of units and equipment that will 2 fail or need extensive capital repairs. Further, fleet repairs can vary from year 3 to year as they depend on the number and type of repairs performed each 4 year. 5 6 4. Garage Tools 7 Q. WHAT INVESTMENTS ARE PLANNED FOR GARAGE TOOLS OVER THE TERM OF 8 THE MULTI-YEAR RATE PLAN? 9 A. Our capital investments for Garage Tools will include investments related to 10 maintaining and replacing garage lifts, jacks, and other tools. Starting in 2021, 11 we have also budgeted additional amounts related to equipping our garages 12 with fall restraint equipment to meet U.S. Occupational Safety and Health 13 Administration's (OSHA) requirements. This new fall restraint equipment, 14 which includes harnesses, lifts, and related items, is necessary to comply with 15 OSHA requirements and to keep our fleet technicians safe. 16 17 Q. WHY IS THE BUDGET FOR GARAGE TOOLS FOR 2021 TO 2023 HIGHER THAN 18 ACTUALS FOR 2019 AND EARLIER? 19 A. There are two reasons. First, as I discussed, we have budgeted additional 20 capital in 2021 through 2023 to add fall restraint equipment to our garages. 21 Second, due to the organizational changes, historical actual expenses do not 22 capture all of the capital additions for fleet repair, but going forward, actuals 23 should align with budgeted amounts. 24 52 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 Q. WHAT DO YOU CONCLUDE ABOUT THE 2021-2023 CAPITAL INVESTMENT 2 FORECASTS FOR FLEET? 3 A. I conclude that our capital forecasts for Fleet represent an accurate and 4 reasonable picture of our investments over these years. Therefore, these 5 forecasts can be relied on to set just and reasonable rates for our customers. 6 7 VII. COMPLIANCE ITEM ON LOBBYING COMPENSATION 8 9 Q. DO YOU PROVIDE COMPENSATION INFORMATION FOR EMPLOYEES ENGAGED 10 IN LOBBYING? 11 A. Yes. In Docket No. E002/GR-10-971, the Company agreed to include in its 12 next rate case a report of the total compensation for employees engaged in 13 lobbying, with an explanation of the costs included and excluded in the rate 14 request. This information is provided in Exhibit___(WKH-1), Schedule 10. 15 The scope of the information presented in this schedule and EER Schedule 9 16 is consistent with the approach taken in our past electric rate cases. 17 18 VIII. CONCLUSION 19 20 Q. PLEASE SUMMARIZE YOUR TESTIMONY. 21 A. Our EER Schedules contain the employee expense information required by 22 the Employee Expense Statute. We have conducted a rigorous review to 23 ensure that employee expense costs included in the test year are consistent 24 with the Employee Expense Statute, the commitments in our prior rate cases, 25 and the guidelines in our Employee Expense Policy. 26 53 Docket No. E002/GR-20-723 Husen Direct PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED 1 For employee expenses, we have made rate case adjustments of $1.6 million 2 for 2021, $1.5 million for 2022, and $1.6 million for 2023. For corporate 3 aviation, we have made rate case adjustments of $2.8 million for 2021, $2.2 4 million for 2022, and $2.6 million for 2023. These adjustments ensure that 5 reasonable and appropriate costs are included throughout the term of the 6 MYRP. 7 8 We are requesting recovery for approximately $14.6 million for employee 9 expenses for 2021, $14.1 million for 2022, and $14.5 million for 2023. We 10 have budgeted $18.3 million in 2021, $19.3 million in 2022, and $18.7 million 11 in 2023 for Fleet capital additions to maintain reliable, high quality utility 12 trucks and other equipment. 13 14 Q. DOES THIS CONCLUDE YOUR DIRECT TESTIMONY? 15 A. Yes, it does. 54 Docket No. E002/GR-20-723 Husen Direct Northern States Power Company Statement of Qualifications W. Kile Husen Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 1 Page 1 of 1 XCEL ENERGY, INC. Minneapolis, MN Director Supply Chain Process Governance Director -Sourcing & Purchasing Director A/P and Supply Chain Support Jan. 2015 - Present May 2008 Jan. 2015 Feb. 2003 May 2008 Works with senior leaders across the enterprise to drive integrated process and technology improvements. Accountable for the integrity of business processes, data, and systems within the enterprise supply chain area. Regularly measures process effectiveness, efficiency, and adherence, and approves remedial action plans. Accountable for budgeting, resourcing, and benefits realization for all aligned improvement and enhancement programs. NRG ENERGY, INC. Minneapolis, MN Director - Financial Systems and Accounting Manager Thermal Accounting Oct. 1997 Feb. 2003 Responsible for creating the financial system infrastructure for the company that supported the growth and complex financial needs of this company as it grew from $1 billion in assets in 1997 to $13 billion in 2003. Also served as the divisional controller for NRG's Thermal Group. LIFETOUCH INC. Bloomington, MN Manager Financial Reporting Oct. 1994 Oct. 1997 Responsible for all corporate financial reporting for this $500 million employee owned photographic company. SPACE CENTER COMPANY St. Paul, MN Assistant Controller Internal Auditor/Special Projects Nov. 1993 - Oct. 1994 June 1990 - Nov. 1993 Responsible for the accounting function of four privately owned companies doing business in real estate, public warehousing, radio broadcasting, and petroleum exploration. ERNST & YOUNG Minneapolis, MN Auditor Aug. 1987 - June 1990 EDUCATION / CERTIFICATION Certified Public Accountant (inactive) St John's University Collegeville, MN Major: Accounting (Honors) Minnesota 1987 1987 Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 1 of 20 Travel and Expense Policy Policy 10.2 Purpose This policy sets forth expectations regarding the use of the corporate credit card for approved business-related expenses and the expense statement filing requirements. It also outlines the requirements for business travel, meals, entertainment, recognition and more. Applicability The Travel and Expense Policy ("Policy") applies to all employees of Xcel Energy Inc. and its subsidiaries and affiliates ("Xcel Energy"). Policy Highlights · Employees should make cost-effective and policy-compliant decisions. · Leaders should carefully review and approve all expense reports. · Call the Supply Chain Hotline Support at 303-628-2644 with questions. Consultant travel and business-related expenses should be managed in accordance with a negotiated contract and the Contractor Guidelines for Expenses. Business related expenses must be reimbursed through Professional Service Agreements established with consultant or consulting firm. Staff Augmentation Contractor travel and business-related expenses must be invoiced by contracting agency under the terms of its Master Staff Augmentation Services Agreement with Xcel Energy. The agency is responsible to reimburse the agency's workers expenses. Index Administrative · Corporate Credit Card · Expense Statement Filing · Receipts and Records Travel, Meals, Entertainment and Recognition · Business Meetings and Events · Entertainment · Meal Expenses · Alcohol Expenses · Tips and Gratuities · Air Travel · International Travel · Foreign Currency Transactions · Combined Business and Personal Travel · Spousal Expenses · Non-Reimbursable Travel Expenses · Hotels/Lodging · Vehicles · Vehicle Accidents · Parking Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 2 of 20 Travel and Expense Policy (10.2) 2 · Bargaining Unit Per Diems · Telephone Charges While Traveling · Employee Recognition Other Expenses · Club or Organization Dues · Contributions to Candidates for Office and Elected or Appointed Public Officials · Mobile Devices · Personal Protective Equipment Allowance If you have questions regarding this Policy, please contact the Supply Chain Hotline at 303-628-2644. Requirements and Responsibilities General Statement Regarding Travel & Expense Reimbursement Upon leader approval, Xcel Energy will reimburse employees for reasonable travel and business-related expenses that the company normally considers deductible under the Internal Revenue Code and regulations for deductible business expenses. Employees are expected to use sound business judgment and plan travel and other business-related expenses to minimize costs. Corporate Credit Card Employees who incur travel and other business expenses for Xcel Energy will be issued, and are required to use, a company-sponsored corporate credit card. Use of the corporate credit card must be in accordance with this Policy and the Sourcing and Procurement Matrix. If you have questions about expenses not covered in this Policy or in the matrix, please contact the Supply Chain Hotline. Staff Augmentation Contractors and interns are not eligible for corporate credit cards. Staff Augmentation Contractors can seek reimbursement for expenses through their contract agency or invoice based on the Professional Service Agreement. Corporate credit cards are assigned to individual employees and must be used only by the employee whose name is on the credit card. Leaders are responsible for assigning transaction limits for employees during the application process. The following standard transaction limits apply unless other limits are requested and approved: · $1,500 per purchase transaction, · $2,000 per travel expense transaction, and · $5,000 monthly limit Limits greater than standard require a higher level of approval based on amount requested. Splitting transactions that are greater than the assigned limits is not allowed. If an employee is required to make a purchase that is greater than the assigned limits, he or she must complete and submit either a OneTime Authorization Limit Change or a Permanent Limit Change request. The employee's Leader must forward the approved form via e-mail to cardadminsupport@xcelenergy.com to execute the request. Personal Use of Corporate Card Personal purchases of any type using the corporate credit card are not permitted. In the event that the corporate credit card is used inadvertently for a personal purchase, the employee must mark the expense as "personal" on the expense report and notify their leader. Personal use expenses are monitored to ensure the corporate credit card is used appropriately. The willful intent to misuse the corporate credit card (i.e. knowingly making personal purchases) may be subject to discipline, up to and including termination of employment. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 3 of 20 Travel and Expense Policy (10.2) 3 Use of Personal Card or Cash Out of Pocket The use of personal card or cash out of pocket for business purposes should be rare. Unless otherwise noted in this Policy (e.g. tips, tolls, mobile), it is only appropriate to claim cash out of pocket reimbursement for expenses incurred while traveling when credit cards are not accepted or if an employee inadvertently uses a personal credit card for business travel or business-related expenses. The employee should claim the business expense as "cash out of pocket" on the expense statement and attached the proper detailed itemized receipt documentation. Cash out of pocket expenses are monitored to ensure the corporate credit card is used appropriately. Expense Advances Cash advances for travel expenses or reimbursement of travel expenses prior to submitting an expense reimbursement statement are not allowed. Capital Charges with a Corporate Credit Card Capital purchases on corporate credit cards are permissible with prior business unit management approval and submittal of the Authorization Form located in the Capital Charges with Corporate Credit Card policy. Prior to use of a corporate credit card for capital purchases, the business unit is responsible to review and adhere to the Capital Charges with a Corporate Credit Card policy. Expense Statement Filing Each employee is to include only his or her expenses on an expense statement. Leaders can include on their expense statements minor expenses for their employees who do not ordinarily use an expense statement. Expenses for special meetings, conferences, conventions, seminars, industry meetings, training classes and travel are reimbursable and may be combined with routine expenses on one expense report. Employees may include on their expense statement, expenses for meetings, conferences, meals, etc. where the leader(s) is in attendance with other staff and charged to a subordinate's corporate credit card. Proxies Xcel Energy allows the use of proxies in the expense report process. The term "Proxy" applies to an employee who acts on behalf of another employee (e.g. creates and submits and/or approves expense reports). Proxies can only approve reports if they have the approver role in the Expense Management System. Only supervisor level and above have the approver role in the Expense Management System. Employees/Proxies and Approvers will be held equally accountable for the accuracy of report information. Expense Report Submission Timing Employees should submit only one expense report per month within 30 days of the first expense transaction. Employees can choose a day of the month and submit their expenses in the Expense Management System each month on that date to maintain the 30-day submission window. Employees will be notified if expenses are not submitted within 30 days of the incurred expense. Daily notifications will be sent for expenses that are not submitted within 45 days of the incurred expense. Expense statements not submitted within 60 days will cause the employee's corporate credit card to be suspended until the report is complete. In accordance with IRS regulations, any employee expenses not claimed within 60 days of when the expense was incurred may be deemed taxable income to the employee. Expense statements that are 90 days delinquent will cause the employee's corporate credit card to be closed. Approval from the Director, Supply Chain Business Operations will be required to obtain a new credit card. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 4 of 20 Travel and Expense Policy (10.2) 4 Proper Documentation for Expenses For Internal Revenue Service (IRS) reporting, proper documentation for expenses is required, including a complete business purpose. Business purposes must adequately describe why the expense was incurred, not what the expense was. For example, an appropriate business purpose for an overtime meal expense while working on a boiler repair would be: "Overtime Meal -- Boiler Repair." One-word descriptions such as "dinner" or "tickets" are not considered adequate. Abbreviations may be used in the business purpose as long as the abbreviation is spelled out on the receipt or in the description field. Employees must allocate expenses to the correct accounting and expense type. Employees must update any predefined/default I/O numbers in the Expense Management System when their accounting codes change (due to a role change, for example). Employees should contact their Business Area Finance Representative if they have any questions regarding the correct accounting or expense type. Expense Approval Leaders are required to use discretion based on business needs and approved budget when approving expenses. Leaders and/or Proxies who approve reimbursement for travel and business expenses are ultimately responsible for the overall accuracy and completeness of the expenditures being claimed and must ensure: · All transactions are adequately documented. · All transactions are appropriate and comply with all company policies and procedures. · Any exceptions are warranted and properly documented. · Correct type of cost and expense type have been assigned. · Necessary detailed itemized receipts have been included. · Other necessary documentation has been provided. Receipts and Records The company requires records and detailed itemized receipts to qualify the employee as having "accounted to his or her employer" for reimbursement of expenses, as defined by the Internal Revenue Code. The following instances always require a detailed itemized receipt: · All expenses using a personal credit card or cash, regardless of amount. Exceptions include reasonable tips and tolls. · All lodging expenses. This is to ensure appropriate accounting for sales and use tax. In addition, the itemized detailed receipt for any expenses charged to the lodging bill must be submitted. Hotels will provide an itemized receipt if requested. · All purchase-type expenses (such as materials, subscriptions, tangible goods or anything other than typical travel expenses) regardless of amount. This is to ensure appropriate accounting for sales and use tax. · Authorized invoice payments using the Corporate Card. The invoice must be uploaded into the Expense Management System and the following details are required in the description box: the invoice number and the name of the ultimate seller/vendor if the transacted merchant does not align. · Airline travel and service fees. The itinerary showing the amount charged is the required detailed itemized receipt. · Costs associated with alcohol purchases. Alcohol purchases must be broken into separate expense types. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 5 of 20 Travel and Expense Policy (10.2) 5 · Meals at or above $25 with tip included. Tips must be properly documented on the receipt or outlined in the description box. The itemized receipt for a business meal must include the specific business purpose, first/last name and title of those in attendance, including affiliation/company of non-employees and business relationship, such as "employee" or "guest." Group meals that exceed 20 people require a sign-in sheet that outlines the group in attendance with names and relationships as supporting documentation. · All travel type expenses at or above $25. · Multi-trip mileage requires use of a Mileage Authorization form. Single mileage trip detail (for a one-way or round trip) can be entered in the system. Employees must disclose the point of departure and destination with the exact address, service center name or airport code and the total miles for the trip. Credit Card Receipts Machine-produced detailed itemized receipts are required and must be submitted along with the credit card receipt to support documentation. If the employee's credit card number is displayed on the receipt, black out all but the last four digits to protect sensitive information. Lost Receipts If a receipt is lost or not available, the employee must complete and sign a Lost Receipt form, verifying the legitimate expense. This documentation then serves in place of a detailed itemized receipt. Employees should add information in the description section of the Expense Management System explaining relevant details for expenses incurred that are not self-evident. Business Meeting & Events Whenever possible, business meetings should be held on company property and limited to business requirements. When off-site business meetings and events are required, every effort should be made to use existing contracted corporate agreements or contracted hotels. The Travel Management Company agent will support the identification of contracted meeting spaces. Entertainment Any expenses associated with entertaining employees and/or non-employees are reimbursable only when the principal purpose of the activity benefits the company. Modest and appropriate meals and/or entertainment may be provided to persons who have business with Xcel Energy. Such meals and/or entertainment given must be in connection with a business discussion and must comply with Xcel Energy's Conflict of Interest guidelines outline in the Code of Conduct. Entertainment - Travel Entertainment - Meal Entertainment - Tickets Travel expenses related to entertainment events (e.g. airfare, lodging, rental car). Meals related to entertainment. Includes non-employees or the combination of employees and non-employees. Any entertainment expenses for employees only should be considered recognition. Refer to the Employee Recognition section. Charges associated with any ticketed sporting event or other ticketed entertainment, as well as, costs associated with recreational events (e.g., golfing, fishing, resort activities, etc.). Includes non-employees or the combination of employees and non-employee. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 6 of 20 Travel and Expense Policy (10.2) 6 Meal Expenses Meal expenses includes food, non-alcoholic beverages, alcoholic beverages, and associated taxes and tips. The correct expense type must be used for: · Travel Meals · Business Meals · Entertainment Meals · Recognition Meals (See Employee Recognition) The recommended per-meal guidance is breakfast $8-10, lunch $10-15 and dinner $20-40. The maximum allowance is $65 per person, per day, including food, non-alcoholic beverages, alcoholic beverages and associated taxes and tips. If an employee exceeds the $65 per person, per day maximum he or she must submit written approval from their business unit vice president with the receipt(s). When two or more employees attend a meal for company business, the highest-ranking employee must submit the costs for reimbursement. However, expenses for large team meetings, where leader(s) attend with other staff, may be charged to a subordinate's corporate credit card and included on the subordinate's expense statement. Meals related to approved professional organizations, industry or trade associations are reimbursable. Every effort should be made to use contracted corporate agreements for food and beverages purchased for onsite business meetings. Business Meal (Emp Only) Business Meal (Non Emp) Travel Meal Entertainment - Meal Business Meals with only employees present will be reimbursed when the meeting has a valid business purpose and could not have been reasonably conducted during regular business hours. Meals to discuss casual business matters will not be reimbursed. If the business meal occurs while traveling with employees, it should still be classified as a business meal. Business Meals with employees and non-employees that principally benefit the company may be reimbursed if the business cannot be reasonably conducted during regular business hours. If the business meal occurs while traveling with non-employees, it should still be classified as a business meal. Meals and beverages incurred while traveling for business. If the meal is for a valid business meeting, it must be classified as a business meal and not a travel meal, even if the meal is incurred while traveling. Meals consumed with other traveling employees in which business is not the focus should be classified as a travel meal and separate tabs are preferred. Meals related to entertainment. This includes non-employees or the combination of employees and non-employees. Any entertainment expenses for employees only should be considered recognition. Alcohol Expenses Employees should consider the appropriateness and the company's liability when serving and/or consuming alcohol. Employees must comply with the company's fitness of duty provisions outlined in the Alcohol and Drug-Free Workplace Policy (9.3). Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 7 of 20 Travel and Expense Policy (10.2) 7 All costs associated with alcohol purchases must be broken into separate expense types on the expense report. Tips and Gratuities Tips and gratuities should be reasonable in relation to the locale visited, commensurate with the service performed. The amount of percentage of any gratuity paid should not exceed 25% and must be visible on the receipt or noted in the description box. Air Travel Before booking any travel arrangements, employees must determine the business need for the trip and consider less costly alternatives, such as teleconferencing or other conferencing options. Commercial Air Travel Air travel costs constitute the largest controllable travel expense incurred by Xcel Energy. Employees must use the Travel Management Company's online booking tool when making air travel arrangements to take advantage of negotiated financial savings, track unused or cancelled airline tickets and for employee safety reasons. Travel arrangements should not be based on availability of upgrades, frequent flyer awards or bonus points. The Travel Management Company is not authorized to book first-class or business-class air travel and related expenses are not reimbursable. Employees requesting premium seat upgrades must seek approval from their leader (director-level or above). Premium seat assignment is defined as bulkhead, aisle, and exit row or premium economy. Contact the Travel Management Company to negotiate discounted rates for group travel of 10 or more traveling together. Avoid penalty fares and refundable tickets. In general, a non-refundable ticket is less expensive than a fully refundable ticket. Non-refundable tickets must be purchased whenever available. Every attempt must be made to book travel at least 14 days in advance of the trip. If plans change and a future trip is anticipated, the ticket can still be used. Last-minute arrangements, changes and/or cancellations should be avoided whenever possible as they substantially increase travel costs and frequently result in penalties. Employees are responsible for canceling reservations. Employees must notify the Travel Management Company of the unused ticket so the credit information is properly recorded and applied to the next ticket purchased. A change fee and any increase in the non-refundable fare at the time of the ticket change will apply. However, the additional charges are generally still less than the cost of a full coach fare. Employees must submit a copy of the original itinerary and documentation of additional charges with their expenses. Tickets for air travel will be issued as electronic tickets whenever possible and will be e-mailed, along with an invoice/itinerary, directly to the e-mail address in the employee's profile. Paper tickets will be issued only for airlines that do not offer electronic tickets. Service fees for booking airline reservations are reimbursable. Early Arrival or Extended Stay Employees may arrive early or extend their stay at a business destination for up to two days for reimbursement purposes provided the additional stay results in an overall savings to the company. Spousal travel expenses are not reimbursed as part of this program. A travel itinerary provided by the Travel Management Company, substantiating the cost savings, may be required prior to reservation by the approving leader, Corporate Card Team or Audit Services. Other expenses incurred during the extended stay of a personal nature, such as sightseeing or recreational expenses, will not be reimbursed. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 8 of 20 Travel and Expense Policy (10.2) 8 The frequency of extended stay for employees traveling on company business is at management's discretion. Frequent Flyer Miles and Points Frequent flyer miles and points for hotel stays (or other reward programs) accrued when traveling on company business may be used for upgrades, business or personal travel. Choosing a particular supplier to maximize personal frequent flyer miles or booking through hotel or other internet websites to maximize hotel points is not permitted. Xcel Energy does not reimburse expenses related to frequent traveler programs. Executive Travel Restrictions on management levels traveling together are intended to ensure continuity and guard against the loss of senior leadership should an accident occur. The following restrictions apply to air travel: · Xcel Energy's Chief Executive Officer (CEO) shall travel with no more than two of his or her direct reports. · No more than three of the CEO's direct reports shall travel together. · No more than 50 percent of EVPs or SVPs direct reports can travel with him or her. The CEO must approve exceptions to these restrictions prior to travel. While these travel restrictions focus on executive management levels traveling together, similar provisions should apply to all employee groups. Corporate Aircraft In order to efficiently transport employees and business associates throughout the United States and Canada, the Company operates corporate aircraft. Corporate aircraft are used to save time and enhance employee productivity. The priority for use of corporate aircraft is determined by the needs of: 1. Executive Committee Members 2. Vice president level direct report to an Executive Committee Member 3. Other employees The following are authorized to schedule corporate aircraft: · Executive Committee Members · Vice president level direct reports to an Executive Committee Member A flight may be flown without an Executive Committee Member or vice president level direct report to an Executive Committee Member to either reposition, is deemed cost-effective and approved by an Executive Committee Member. Commercial travel should be considered first for long distance, single-destination trips requested by executives other than the CEO. CEO and direct reports are permitted to travel business-class on commercial flights when it is more cost effective than using the corporate aircraft. Open seats on scheduled flights are available to any employee traveling for business at no charge to the business area. Reservations for open seats are made on a first-come-first-serve basis. Cancellations of confirmed seats must be made well in advance to ensure enough time to clear waitlisted passengers who might otherwise have flown commercially. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 9 of 20 Travel and Expense Policy (10.2) 9 Bumping is allowed as a last resort to meet the needs of Executive Committee Members or members of the Xcel Energy board of directors. A business unit vice president can bump with seven days' notice. Flights are generally limited to four days per week involving travel between Minneapolis, Denver and Amarillo. A flight with fewer than five passengers may be subject to cancellation. Aircraft Schedules and Passenger Schedules can be viewed on the Aviation Services website. The Aircraft Schedule shows all scheduled flights for the next 60 days. The Passenger Schedule shows trip reservations and ground travel requirements for each passenger in the same upcoming 60-day period. To make a reservation on the corporate aircraft, employees must contact the Aviation Services Travel Scheduler. A description of the business reason for the travel must be submitted with reservation requests. Passengers must comply with all flight safety rules and procedures. The aircraft pilot-in-command maintains final authority on aircraft operation and safety of flight. Smoking and alcohol consumption is not permitted on board company aircraft. A passenger who appears to be intoxicated will not be allowed on-board. Hazardous materials are not allowed on company-owned or contracted aircraft. Firearms are not allowed on companyowned or contracted aircraft unless approved by the CEO or required by the Transportation Security Administration (TSA) into certain airports. Flights on corporate aircraft will not be scheduled for personal use. Limited non-business travel for employees and/or their relatives on corporate aircraft will be permitted on business trips only if seats are available and approval is obtained before the flight from the Director, Aviation Services. In accordance with IRS requirements, personal travel may result in additional imputed personal income and additional income taxes to the employee benefiting from the personal travel, based on published U.S. Department of Transportation Standard Industry Fare Level (SIFL) rates. Non-employee passengers whose flights are supporting Xcel Energy business must have their transport on corporate aircraft pre-approved by an employee at or above the vice president level. In addition, approval must be obtained from the CEO prior to the transport of candidates for public office or elected/appointed public officials on corporate aircraft. Two general rules follow: · Local, state or federal candidates or their representatives should not be transported during an election campaign in which they are candidates. · Avoid situations where the transport of any candidate or public official could be construed as an attempt to influence the outcome of an election or any pending or proposed legislation that is of interest to the company. Charter Air Services Employees may use charter air services when corporate aircraft are not available and travel by commercial airline is not a feasible alternative, provided that Aviation Services screens and approves charter air services prior to use to ensure the charter operator's compliance with safety procedures, crew qualifications, aircraft airworthiness and adequate insurance coverage. Xcel Energy Aviation Services schedules such charters so that their use can be documented for possible Federal Aviation Administration or legal inquiries and to monitor the quality of service provided. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 10 of 20 Travel and Expense Policy (10.2) 10 Travel on Non-Xcel Energy Business Aircraft The Director, Aviation Services should provide approval to employees before they travel on another company's private aircraft to ensure compliance with standards established for corporate aircraft operations or charter contractors. Personal Aircraft Due to liability and insurance coverage concerns, employees are not permitted to travel on behalf of the company in personal aircraft or aircraft not flown by professional pilots. Personal aircraft refers to aircraft owned, rented or operated by individuals whose primary job function is not that of a pilot. International Travel International Business Travel All international travel must be approved at the business unit vice president level prior to making a reservation, excluding Canada. Employees traveling internationally are required to book travel according to the air travel practices listed in this Policy, with the following additions: · Submit an International Travel Form, including for Canada, at least two weeks prior to travelling abroad. The Enterprise Command Center team will perform and initial review the International Travel Form to assess physical and cyber risk, as well as, overall threat. · Contact the Legal Services department at 612-215-5207 or 612-215-4587 before making international travel arrangements to discuss export control compliance. · Call the corporate credit card customer service to inform them of the upcoming international trip. This helps ensure that the employee's card is not inactivated for unusual activity. · If any one particular leg of the flight is greater than six hours in duration and/or crosses an ocean, it is permissible to consider upgrading to business class. Final approval to upgrade to business class must be obtained from the employee's business unit vice president or higher before booking. International Personal Travel Employees traveling internationally for vacations may choose to submit an international travel form and request a Pre-Trip Advisory for personal trips abroad. Employees taking personal international trips are strongly discouraged from taking Xcel Energy assets (i.e. laptops, thumb drives, cell phones) abroad, despite the risk level in the destination. If an employee intends, or is required, to take Xcel Energy assets abroad, the employee must: · Receive business unit vice president approval to take the asset(s) on their personal trip. · Submit an International Travel Form, including for Canada, at least two weeks prior to travelling abroad. A member of the Enterprise Command Center team will perform and initial review the International Travel Form to assess physical and cyber risk, as well as, overall threat. · Contact the Legal Services department at 612-215-5207 or 612-215-4587 before making international travel arrangements to discuss export control compliance. · For either business or personal travel, employees may request a Pre-Trip Advisory (PTA) for their intended destination. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 11 of 20 Travel and Expense Policy (10.2) 11 Foreign Currency Transactions For expenses incurred when traveling to another country (including Canada), the expenditures recorded on the expense report must be in U.S. dollars, reflecting the proper exchange rate. When cash expenses are incurred in foreign currency, it is the employee's responsibility to obtain the most favorable official currency conversion rate. Combined Business and Personal Travel When combining personal and company business travel, the business trip portion must be booked through the Travel Management Company. The personal travel portion may also be booked with the travel management company; however, all personal travel costs must be paid for separately. Employees may arrive early or extend their stay at a business destination. For more information on early or extended stay, refer to the "Early Arrival or Extended Stay" section. Spousal Expenses Costs for travel, lodging, meals or other travel expenses for spouses or other family members will not be reimbursed unless the individual has a bona fide company purpose for engaging in the travel or attending the event and the expenses are approved at the senior or executive vice president level. Such travel is generally limited and should be rare. Non-Reimbursable Travel Expenses Non-reimbursable expenses include: · Incremental expenses incurred as a result of personal stopovers, weekend side trips or other personal travel scheduled within or around the business itinerary. · Excess baggage charges for personal items (excluding bag fees required by the airline, such as for the first checked bag), personal grooming, laundry services, health-related expenses (except for emergencies not covered by the employee's medical insurance program), late payment fees associated with reimbursement for use of personal credit cards, personal travel insurance, loss of cash advance money or personal funds, dependent care expenses and household expenses incurred during an employee's travel. · Purchase of luggage, clothing or other personal items is not reimbursable. If items are lost in transit, employees should replace items, attempt reimbursement through airlines (or other vendors), then through their homeowners insurance. · Traffic/parking fines, towing, court costs, airline club memberships, class upgrade charges for airline (excluding pre-approved premium seat upgrades), personal entertainment expenses, personal gifts, personal reading materials and airline headset rental. Hotels/Lodging Employees are required to use the Travel Management Company's online booking tool when making lodging arrangements. Using any other source may cause the company to be out of compliance with security requirements and lose negotiated financial benefits. In addition, by using the Travel Management Company to make lodging arrangements, it allows the Company to quickly locate employees during a security concern. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 12 of 20 Travel and Expense Policy (10.2) 12 Xcel Energy has negotiated certain discounted hotel rates at contracted properties. These hotels should be used whenever possible for overnight accommodations on business trips when the contracted property is close to the employee's final destination. Where negotiated discount rates are not available, the Travel Management Company will recommend good quality, moderately priced hotels. Service fees for booking hotel reservations are reimbursable. In rare cases, extenuating circumstances may justify booking property not using the online booking tool (e.g., travel for outages and emergencies). In this case, you should ask for the lowest available rate at check in because a lower rate may be obtained than was originally quoted. Often hotels will reduce rates based on low occupancy. If you're unsure that the event justifies booking outside of the Travel Management Company, please contact the Supply Chain Hotline at 303-628-2644. When attending a meeting, conference or other event that has a designated booking channel for hotel rooms, please contact the Travel Management Company to make the lodging arrangement. Employees may be able to secure lower rates by supplying individual travel club information. Employees should include this information on their travel profile to ensure that the Travel Management Company can access those rates at the time of booking. Lodging in the Local Area Employees who are attending an off-site meeting and reside in the same local area should commute to and from the meeting rather than stay in a local hotel, unless the length of the meeting or commute time represents an undue burden. If an employee feels this is an undue burden, he or she should discuss this with his or her leader (director-level or above), in advance, who may approve other arrangements. Cancellations Room reservation cancellations must be made according to instructions on trip itineraries to avoid a "no-show" charge. Employees should contact the Travel Management Company to make cancellations. Employees who must cancel a reservation on their own should note the cancellation number and hotel contact person. Xcel Energy will not reimburse "no-show" charges. Telephone Charges While Traveling Employees traveling should make business-related telephone calls from company locations whenever possible, and/or use a calling card or Mobile Device to avoid direct-call fees from hotels or other public locations that charge high rates. While traveling, reimbursement of personal telephone calls of a reasonable duration and frequency is permitted provided the employee uses the most economical means available. Non-bargaining employees who use their Mobile Device for incidental business or personal telephone calls while traveling, and who do not have a Personal Responsible Account, may request reimbursement as outlined in the Mobile Device Standard. Vehicle Use Ground Transportation for Travel Employees may use their personal vehicle over air travel, provided the expenses are less than the lowest available round-trip airfare that would have been scheduled for the employee by the Travel Management Company. When evaluating costs, the employee must include expenses associated with the trip to and from the airport and any costs associated with vehicle rental or ground transportation at the business destination. When using a personal vehicle, the standard approved mileage rate for the most direct route to and from the business destination, and meals and lodging expenses for the travel time, should be included for comparison purposes. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 13 of 20 Travel and Expense Policy (10.2) 13 Approval for selecting ground transportation over air travel must be obtained in advance from your business unit vice president or higher. All expenses must be supported with appropriate detailed itemized receipts and documentation, and reimbursement will be for the employee share only. Documentation of the lowest available round-trip airfare provided by the Travel Management Company must be included with expense filing statement. Mileage Personal vehicles driven for Xcel Energy business purposes must be of reasonable value, in good repair and in safe operating condition. Motorcycles shall not be used. Ground transportation expenses are reimbursable when employees use their own vehicle for required company business and the mileage exceeds the mileage between the employee's home and regular work location(s). For documentation purposes, employees must disclose the point of departure, the destination and the total miles for the trip. Employees should be aware that if mileage is paid, but is not reimbursable under IRS guidelines, that reimbursement to the employee is taxable income per IRS regulations. The following illustration depicts the rules used to determine if ground transportation expenses are reimbursable. Reimbursable if you have a regular work location elsewhere, less mileage between home and regular work location C1 Temporary Work Location / Customer #1 RAelwimabyusrsable Always Reimbursable A Home Never Reimbursable B Regular Work Location Reimbursable if you have a regular work location elsewhere, less mileage between home and regular work location Always Reimbursable C2 Temporary Work Location / Customer #2 Expense reimbursement scenarios: · Between home (A) and regular work location (B), whether by car or bus, is never reimbursable. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 14 of 20 Travel and Expense Policy (10.2) 14 · Between home (A) and temporary work location/customer (C1 or C2), if you have a regular work location elsewhere, is reimbursable less mileage between home and regular work location. If the normal one-way commute (A to B) is 10 miles and the mileage to the temporary work location (A to C1) is 15 miles, then 5 miles are reimbursable. · Between regular work location (B) and temporary work location/customer (C1 or C2) is always reimbursable. · Between two or more temporary work locations/customers (C1 and C2) is always reimbursable. Definitions: Home Regular work location(s) Temporary work location The place where you reside. Transportation expenses between your home and your main or regular work location(s) are personal commuting expenses. Your principal place(s) of business. This is not your regular work location, but another company or off-site location to which you travel to perform work-related activities or to attend meetings or events. Travel to this location is for a year or less. All of the above rules apply on weekends. Therefore, mileage incurred from home (A) to regular work location (B) on the weekend is not reimbursable. Vehicle Rental Employees should rent vehicles only when other transportation is more costly or impractical. Mass transit is available in many cities and may be a less expensive and more efficient mode of transportation than a rental vehicle. Likewise, taxis, ride-sharing services (Uber, Lyft) or hotel shuttles may eliminate the need for rental vehicles if additional ground travel is not expected during the trip. In some cases, a limousine service may be more economical or feasible, depending on the employee's final destination. The employee should make all efforts to be flexible and to select the lowest cost option that is reasonably convenient and that does not compromise personal safety. Xcel Energy has contract rates with specific rental car vendors and limousine providers. Those contracted providers should be used to take advantage of negotiated financial benefits. Frequent rental car membership enrollment is available online by accessing the preferred car program through the Travel Management Company. Rental vehicle size should be requested based on business needs. Intermediate sized cars are standard. Insurance Employees should not accept additional vehicle insurance for rentals in the United States. The Xcel Energy self-insurance policy and the bank issuing the corporate credit card provide this coverage. When renting a vehicle outside the United States for business, employees should purchase the liability and physical damage insurance coverage. If the employee rents a vehicle for both business and non-business travel during the same rental period, he or she may wish to purchase the additional insurance coverage for the non-business portion of the trip. Employees will not be reimbursed for this expense. Employees must have personal insurance on their personal vehicle, carried at the minimum level designated by the state where the vehicle is registered, if the personal vehicle is used for company business. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 15 of 20 Travel and Expense Policy (10.2) 15 Fuel Rental vehicles should be refueled before return to avoid high fuel costs, unless it is a greater cost benefit to refuel at the rental company. If it is known ahead of time that refueling will not be possible and considerable driving is expected, an alternative might be to purchase the gas from the car rental company at time of rental pick-up. Advance purchase of the full tank is generally at local gas station rates. Company Vehicles Although fleet vehicles may be checked out for shorter travel, business travel of more than 50 miles per day should be conducted in a company pool car, where available, to minimize costs. Refer to the Fleet Department website for related information. Contact the Fleet Department to arrange assignment of a pool vehicle or to add another vehicle to the pool at a specific location. Refer to the Company Vehicle Assignment and Use Policy (10.3) for details. Vehicle Accidents Rental Car Accidents If an accident occurs while driving a rental vehicle for business, the employee should first handle injuries (such as calling police and medical assistance) and take precautions at the accident scene to minimize harm to others and then ensure that a police report is filed. A copy of the police report and/or the case number is required by the rental car company and should be obtained for Xcel Energy. The employee also should record all pertinent information about the accident, including other drivers' names, addresses, telephone numbers, insurance carriers and make of cars. The employee should also report the accident to their leader. On return from the business trip, the employee should promptly initiate claim procedures with the corporate credit card provider by calling the number on the back of the card. Company Vehicle Accidents If an accident occurs while you are driving a company vehicle, the employee should first handle injuries (calling police and medical assistance) and take precautions at the accident scene to minimize harm to others and then ensure that a police report is filed. A copy of the police report and/or the case number should be obtained for Xcel Energy. The employee also should record all pertinent information about the accident, including other drivers' names, addresses, telephone numbers, insurance carriers and make of cars. The employee should contact the Security Operations Center (SOC), report the accident to Xcel Energy management and complete and send the Initial Report of Motor Vehicle Incident/Damage form to the Claims Department and Fleet Department using the contact information included on the form. For additional information on the reporting guidelines for accidents in a company vehicle, see Company Vehicle Assignment and Use Policy (10.3) Personal Vehicle Accidents If an accident occurs while you are driving a personal vehicle for company business, the employee should promptly initiate claim procedures with their own insurance provider. The employee should also report the accident to their leader. Vehicle Parking The lowest-cost alternative should be selected for parking associated with business-related events, including airport parking. Parking for a business-related activity is reimbursable only if the amount incurred is from: · A location other than the employee's normal work location · The employee's normal work location and the parking expense were incurred after the employee paid the initial parking fee. For example, if the employee paid $10 to park at his or her normal work location, that $10 is not reimbursable. If the employee left his or her normal work location for business at another Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 16 of 20 Travel and Expense Policy (10.2) 16 location and paid another $10 to return to his or her normal work location, only the second $10 parking fee would be reimbursable. Efforts should be made to minimize this type of parking expense. The following parking expenses are not reimbursable: · Monthly parking or a portion of monthly parking if incurred at normal work location · Weekend parking if incurred at normal work location · Parking tickets or expenses associated with towing a vehicle Bargaining Unit Per Diems A per diem is a daily allowance given to bargaining unit employees to cover expenses related to meals and/or business travel, as opposed to a reimbursement of actual expenses. Depending on certain circumstances, a per diem payment can be either taxable or non-taxable and must be reported on an employee's W-2 Form in either case. In order to facilitate proper tracking and reporting, all per diem payments need to be processed through the time entry system. Per diems may not be entered in the Expense Management System. Employee Recognition XCelebrate Recognition Refer to the XCelebrate recognition website when recognizing benefited employees for outstanding efforts and results, going above and beyond the call of duty or demonstrating our company values. This program should be used for all recognition expenses funded by the corporate recognition budget. Safety Recognition Safety recognition is addressed through the safety program. Other Recognition Additional opportunities are available to recognize one or more benefited employee for work-related accomplishments and/or engagement. Expenses are charged to business area budget, should be paid for using a corporate credit card and must be submitted and reconciled through the Expense Management System. Career Event Life Event Gifts Recognition-Employee Engagement Recognition-Entertainment This includes food and/or a gift provided to acknowledge career-related achievements, including receiving certification, years of service, retirement, graduation or promotion. A Life Event is defined as funeral, major medical situation or the birth or adoption of a child and should be limited to benefited employees and immediate family members. This includes employee engagement and team building activities such as plant tours, and incentives/campaigns based on specific department goals, meals, awards and other associated expenses. Meals and other costs related to these events should also be expensed as employee engagement. If non-employees are present, see the Entertainment Events and Meals section. This includes charges associated with any ticketed sporting event or other ticketed entertainment, as well as costs associated with recreational events (e.g., golfing, fishing, resort activities, etc.). Meals and other costs related to these events are also considered recognition entertainment. If nonemployees are present, see the Entertainment Events and Meals section. Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 17 of 20 Travel and Expense Policy (10.2) 17 Gifts for career and life events should not exceed $70 per qualifying event and should be limited to employees only. Meal expenses must follow the per meal and per day maximum guidance. See the Meals and Entertainment section for the recommended per meal guidance and maximum reimbursement. Additional expenses are subject to area vice president, director or manager discretion and budget constraints. Expenses need to be reasonable in amount, have a business purpose and comply with the Code of Conduct. Employees are encouraged to recognize other events, such as graduations, birthdays, weddings and showers, during breaks and/or lunch hours with business area approval. The company will not reimburse associated expenses such as gifts or catering. Gifts not specifically mentioned in this Policy, given from one employee to another employee, are not reimbursable. Club or Organization Dues Employees should seek prior approval by their appropriate business unit vice president or higher for reimbursement of charges associated with club or organization dues and account for these expenses in the appropriate type of cost and expense type. At the discretion of the CEO, full or partial reimbursement of capital assessments associated with country club memberships or other social organizations may be permitted. Generally, such reimbursement authorization will be afforded only to Xcel Energy board-appointed officers, based on sound business-related rationale and will require a separate type of cost and expense type. Contributions to Candidates for Office and Elected or Appointed Public Officials See Policy 3.8, Political Contributions, Lobbying and Government Communications Mobile Devices Xcel Energy business conducted through a mobile device must be done in a secure manner to reduce information security risks that can result in a negative impact on the company. Xcel Energy permits two types of reimbursable accounts for mobile devices: Corporate Responsible Account and Personal Responsible Account. Corporate Responsible Account A Corporate Responsible Account is in the name of Xcel Energy and Xcel Energy bears payment responsibility to the communication service provider using the corporate credit card. When submitting your phone bill in the Expense Management System, upload the summary version; do not include the detailed phone bill unless otherwise requested by management. Corporate Responsible Accounts may only be used by: · Bargaining unit employees · Non-bargaining employees that share mobile devices or pooled-minute plans with other employees Personal Responsible Account A Personal Responsible Account is in an employee's name and the employee bears payment responsibility to the communication service provider using personal funds. Employees can use a mobile device to conduct company business under a Personal Responsible Account if the employee: · Is required to be on-call after normal working hours · Works in the field or a plant location and it is necessary to be in communication with other employees · Works in a corporate office but frequently travels and it is necessary to be in communication with other employees · Is in a leadership role and it is advantageous to Xcel Energy to conduct business when not in the office Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 18 of 20 Travel and Expense Policy (10.2) 18 The acquisition of, use of and reimbursement of charges associated with mobile devices must be in accordance with the Mobile Device Standard. Xcel Energy has negotiated discounts with several communications service providers that apply to both Corporate Responsible Accounts and Personal Responsible Accounts. Information on these providers can be found at the Cell Phone Service web page. The corporate negotiated discounts are available to all employees, including use that is intended for personal purposes only, and employees are encouraged to take advantage of corporate discounts and special promotions. Personal Protective Equipment For bargaining employees, reimbursement should comply with the collective bargaining agreement. For nonbargaining employees, reimbursement should comply with the Personal Protective and Safety Equipment policy, 12.1.170. Non-bargaining employees must document the frequency of Personal Protective Equipment purchases in the Expense Management System Description section if the amount is higher than the per-year allowance. Consequences of Noncompliance Any employee, regardless of position or title, who violates any provision of this policy, may be subject to discipline, up to and including termination of employment. Contractor violations may result in removal of assignment at Xcel Energy. Reporting and Protection from Retaliation We encourage individuals to speak up without fear of retaliation when they see or suspect policy violations. There are several reporting options available. Retaliation is prohibited and will not be tolerated at Xcel Energy. Please refer to Xcel Energy Anti-Retaliation Policy (9.23). Definitions Corporate Responsible Account Employee Executive Committee Expense Management System Leader Meal Mobile Data Service Mobile Device Mobile Eligible User The type of account for purchasing Mobile Data Services, Mobile Voice Services and/or Mobile Devices that is in the name of Xcel Energy and for which Xcel Energy bears payment responsibility to the communication service provider. Legal definition of an employee, not a person who is contracted through an outside agency to perform work for Xcel Energy. The CEO and members of his or her Executive Committee listed on XpressNET. The expense reporting system the company uses to reconcile employee expenses. It includes all corporate credit card transactions for travel, purchase and approved cash out-of-pocket expenses. An employee who supervises other employees (including supervisors, managers, directors, vice presidents and executive officers). Food, non-alcoholic beverages, alcoholic beverages and associated taxes and tips. Services purchased from a communications service provider that provides Internet access and e-mail/calendar access which are accessible through a Mobile Device. Consumer-level Mobile Device such as smart phones (including BlackBerries, iPhones and Android phones), tablets (such as iPads and Android devices) and PDAs. An employee using Mobile Data Services and/or Mobile Voice Services that is authorized to either 1) use a Corporate Responsible Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 19 of 20 Travel and Expense Policy (10.2) 19 Mobile Voice Service Per Diem Personal Responsible Account Proper Documentation Proxy Staff Augmentation Contractor Travel Management Company Type of Cost Xcel Energy Account or 2) submit reimbursement requests for a Personal Responsible Account. Services purchased from a communications service provider that provides telephone service and which are accessible through a Mobile Device. A daily allowance given to bargaining employees to cover expenses related to meals and/or business travel, as opposed to a reimbursement of actual expenses. The type of account for acquiring Mobile Data Services, Mobile Voice Services and/or Mobile Devices that is in the employee's name and for which the employee bears payment responsibility to the communication service provider. An original or official paper, such as a detailed itemized receipt or invoice, showing all items purchased and/or an explanation containing relevant details for expenses incurred that are not selfevident, signed by both employee and approving leader. An employee who creates and submits and/or approves expense reports on behalf of another employee. A person supplementing the company's work force who is employed by a staffing agency. The person is an employee of the contracted agency and receives wages or salary and benefits from that employer and not Xcel Energy. Xcel Energy pays the agency based on the contracted terms and conditions for the person's services. The use of `Staff Augmentation Contractor' is synonymous with `contingent workers or contract workers'. Contracted travel provider utilized for commercial airfare, rental cars and hotel reservations when planning travel. An accounting classification used to categorize costs by separate object accounts. This categorization drives internal reporting and external financial statement presentation. Xcel Energy Inc., its subsidiaries and affiliates. The use of "we," "ours" or "the company" is synonymous with Xcel Energy. References Code of Conduct Alcohol and Drug-free Workplace policy (9.3) Company Vehicle Assignment and Use policy (10.3) Mobile Device Standard Personal Protective & Safety Equipment Policy (12.1.170) Sourcing and Procurement Matrix (Matrix/Decision Tree) XCelebrate website History of Revisions February 28, 2020 January 2, 2020 December 17, 2016 December 9, 2015 December 19, 2013 March 18, 2013 October 5, 2012 Xcel Energy Northern States Power Company Employee Expense Policy Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 2 Page 20 of 20 Travel and Expense Policy (10.2) 20 May 4, 2011 January 21, 2011 June 9, 2010 February 5, 2010 August 19, 2009 March 6, 2009 Approval This policy was approved by Kent Larson, Executive Vice President, Group President -- Operations and Judy Poferl, Chief Ethics & Compliance Officer. Xcel Energy Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 3 Page 1 of 5 Xcel Energy Corporate Policy Changes Travel and Employee Expense Reimbursement (Policy 10.2) Changes Since November 2015 The Company made several changes in December 2015 and in December 2016 to the Travel and Employee Expense Reimbursement Policy 10.2 to ensure a consistent process for submitting and approving eligible employee expenses. In addition, we reviewed the whole Employee Expense Policy in 2019 and incorporated changes in January 2020 to ensure the policy is clear and easily understood by all employees. Date 12/09/ 2015 Summary of Content Changes · Added the requirement for leaders to ensure employee expense reimbursement aligns with policy and budget when approving expenses. · Clarified how consultant and contractor expenses should be managed. · Removed the requirement for approving leader's signature when submitting the Lost Receipt form. · Added guidance for cash out of pocket expenses when traveling. · Clarified that business meals are not usually associated with travel. · Updated primary cities for corporate aircraft travel. · Revised published Aircraft and Passenger Schedule time frame from 90 to 45 days. · Updated Employee Recognition content to reflect new Xcelebrate online tool and other recognition opportunities. Reasons for the Changes · Emphasize the expectations that proper expense reimbursement process is necessary for the recovery of expenses as a component in rate filings. · Update the changes in aviation as a result of the relocation to Minneapolis and changes in the scheduling process. · Clarify that employee recognition is a priority for the Company and the new recognition tool offers more recognition options. 12/17/ · Strengthened outline of appropriate · Increase employee Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 3 Page 2 of 5 Xcel Energy Corporate Policy Changes Travel and Employee Expense Reimbursement (Policy 10.2) Changes Since November 2015 2016 business purposes. understanding on eligible · Better defined receipt requirement for all cash-out-of-pocket transactions. business expenses and expense reporting. · Added clarification of company sponsored program events for employees and/or non-employees being applicable for entertainment events and meals. · Clarified that rental vehicle refueling should be at the highest cost benefit to the company. · Aligned with Company Vehicle Assignment policy (10.3) on accident reporting for company vehicles and personal or rental vehicles when driving for business. · Clarified that only benefited employees are eligible for employee recognition program rewards. · Updated Expense Advances section to indicate cash advances for travel are not allowed. · Added Capital Charges with a Corporate Card section to outline and link to the existing Capital Asset Accounting policy and guidelines. · Updated definitions, including addition of Employee and Staff Augmentation and removal of Expense Reimbursement Statement. 01/02/ · Restructured policy and table of 2020 contents. · Restructure the Employee Expense Policy to match Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 3 Page 3 of 5 Xcel Energy Corporate Policy Changes Travel and Employee Expense Reimbursement (Policy 10.2) Changes Since November 2015 · Inserted a general statement regarding travel and employee expense the new Company policy template. reimbursement. · Review the whole · Updated the travel expense transaction limit from $2,500 to $2,000. Employee Expense Policy for any necessary changes. · Included stronger language stating that · Strengthen and clarify personal purchases are not permitted, language to ensure that the inadvertent use must be reported, and Employee Expenses Policy willful intent to misuse may be subject to is easily understood by all discipline. employees. · Added that employees must update any predefined/default I/O numbers in the Expense Management System when their accounting codes change (due to a role change, for example). · Stated that the use of personal card or cash out of pocket reimbursement should be rare. · Added that employees should submit a detailed itemized receipt for any expenses charged to a hotel room. · Added that invoice numbers are required for authorized invoice payments using the corporate credit card. · Included conflict of interest language that states meals and/or entertainment given must be in connection with a business discussion and must comply with Xcel Energy's Code of Conduct. · Expanded the definitions of meals; added that meals consumed with other traveling employees in which business is Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 3 Page 4 of 5 Xcel Energy Corporate Policy Changes Travel and Employee Expense Reimbursement (Policy 10.2) Changes Since November 2015 not the focus should be classified as a travel meals and separate tabs are preferred. · Created a separate header for alcohol expenses. · Included stronger language for booking hotels stating that employees are required to use the Travel Management Company's online booking tool when making lodging arrangements. · Added that the use of ride-sharing services (Uber, Lyft) is acceptable and may be cheaper than a rental vehicle. · Clarified that the CEO and direct reports are permitted to travel business-class on commercial flights when it is more cost effective than using the corporate aircraft. · Added EVPs to the executive travel restrictions stating that no more than 50 percent of EVPs or SVPs direct reports can travel with him or her. · Changed the Aircraft Schedule so that it shows all scheduled flights for the next 60 days rather than 45 days. · Added that employees requesting premium seat upgrades must seek approval from their Leader (directorlevel or above). · Updated international travel section to reuire employees to submit an international travel form at least 2 weeks Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 3 Page 5 of 5 Xcel Energy Corporate Policy Changes Travel and Employee Expense Reimbursement (Policy 10.2) Changes Since November 2015 prior to travel. The Business Unit VP must approve all international travel prior to making any reservations. · Added language to clarify that spousal expenses should be rare and must be approved at the senior or executive vice president level. · Restructured the employee recognition section to make clear what is and is not reimbursable. · Added consequences of non-compliance. · Added language on reporting and protection from retaliation. 02/28/ · Clarified that the amount of percentage · Provide clear expectations 2020 of any tips or gratuity paid should not on what is considered to be exceed 25%. a reasonable tip or gratuity. Northern States Power Company Employee Expense Commitments Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 1 of 6 Source Commitment TY 2011 Electric Rate Case Provide direct testimony in future rate cases which (GR-10-971) O'Hara explains all employee expense data in the Surrebuttal Company's technical systems. Where Addressed in TY 2021 Rate Case Husen Direct, Section III, Employee Expense Reporting, and Husen Direct, Section V, Employee Expense Review and Development of EER Schedules, discuss employee expense data in SumTotal, SAP, Corporate PassPort, and TIME applications. EER Schedules 10, 11 and 12 provide a summary of employee expenses processed in systems other than SumTotal. Provided on compact disk, Required Information Vol. 3. TY 2011 Electric Rate Case Provide direct testimony in future rate cases which (GR-10-971) O'Hara explains the process used by the Company to create Surrebuttal the EER Schedules, including any limitations. Husen Direct, Section V, Employee Expense Review and Development of EER Schedules, discusses the process used to develop the EER Schedules and limitations of this process. Husen Direct, Schedule 8 provides the details of the process used to develop the EER Schedules. Northern States Power Company TY 2011 Electric Rate Case Provide direct testimony in future rate cases which (GR-10-971) O'Hara explains the types of employee expenses the Surrebuttal Company is not seeking to recover in rates. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 2 of 6 Husen Direct, Section V, Employee Expense Review and Development of EER Schedules, describes the types of transactions that the Company is not seeking to recover in rates. This Section also describes what expenses are included in the Employee Expense Adjustment. Husen Direct, Schedule 8 provides process details for what is included in and excluded from the EER Schedules as well as the development of the Employee Expense Adjustment. TY 2011 Electric Rate Case (GR-10-971) O'Hara Surrebuttal Provide direct testimony in future rate cases which explains the progress made to improve the reporting of employee expenses and compliance with the Employee Expense Policy. Husen Direct, Section III A, SumTotal, discusses SumTotal characteristics and training. Husen Direct, Section III C, Internal Controls and Monitoring, describes how the Company is monitoring compliance with the Employee Expense Policy and appropriate reporting of employee expenses. TY 2011 Electric Rate Case Provide direct testimony in future rate cases which (GR-10-971) O'Hara explains the findings of any recent internal audits Surrebuttal regarding employee expenses. Husen Direct, Section III C, Internal Controls and Monitoring, discusses the Company's most recent 2018 internal audit of employee expense reporting. TY 2011 Electric Rate Case Provide EER Schedules in a manner that facilitates (GR-10-971) O'Hara review and quantification of categories. Surrebuttal EER Schedules are provided in Volume 3, Required Information, Section IV Other Required Information, Tab 2. Concurrent with this rate case filing, we are providing the OAG and the Department of Commerce live Excel spreadsheets of the EER Schedules to facilitate their review. Northern States Power Company TY 2011 Electric Rate Case (GR-10-971) O'Hara Surrebuttal Update the OAG and the Department of Commerce of changes the Company intends to make to the Employee Expense Policy, employee expense reporting systems, or other changes that will affect the Company's future reporting under the Expense Statute. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 3 of 6 Since we implemented the significantly revised Employee Expense Policy and SumTotal in October 2012, there have not been major plans to change the Policy or employee expense reporting systems. Husen Direct, Section III A, SumTotal, discusses current SumTotal features and any planned improvements. The Company made some changes to the Employee Expense Policy in December 2015 and December 2016. In January 2020, the whole Employee Expense Policy was reviewed for any necessary changes and in February we made one additional change to the policy. Husen Direct, Schedule 2 provides the current Employee Expense Policy and Schedule 3 presents a summary of these changes. TY 2011 Electric Rate Case Meet with the OAG prior to filing future rate cases (GR-10-971) O'Hara to discuss how to streamline regulatory review of Surrebuttal employee expenses. Met with the OAG shortly before filing this rate case. February 22, 2012 ALJ Findings of Fact (GR-10-971) Include a report of the total compensation for employees engaged in lobbying, with an explanation of the costs included and excluded in the rate request. Husen Direct, Section VI, Compliance Item on Lobbying Compensation, discusses compensation for employees engaged in lobbying. Husen Direct, Schedule 10 provides the total compensation for employees engaged in lobbying, with an explanation of the costs included and excluded in the rate request. Northern States Power Company June 20, 2012 Meeting with OAG Provide direct testimony describing how we will implement SumTotal, including safeguards which are in place so no bulk information is missing, whether all fields will map similar to Concur, and whether we will have problems updating data. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 4 of 6 SumTotal has been in place since October 2012, and the Company has discussed its roll out and initial implementation in three prior rate cases. Husen Direct, Section III A, SumTotal, discusses the characteristics of SumTotal. June 20, 2012 Meeting with OAG Provide direct testimony describing how we will preserve data from Concur after SumTotal is in place. While we have preserved old Concur data (prior to October 2012 implementation of SumTotal), it was not used for preparing this rate case. June 20, 2012 Meeting with OAG Provide direct testimony comparing budget to actual data and trending data for employee expenses. Husen Direct, Section IV, Employee Expense Amount, Employee Expense Adjustment, and EER Schedules, provides 2017-2019 budget to actual data and trending data for employee expenses. Husen Direct, Schedule 6 provides the budgeted and actual employee expense data by expense category for 2017-2023. June 20, 2012 Meeting with OAG Provide direct testimony describing whether Concur has been used increasingly to track employee expenses and whether other Company systems are processing fewer employee expense transactions as a result. Husen Direct, Section III B, Other Systems, discusses employee expenses in systems other than SumTotal, which replaced Concur in October 2012. EER Schedules 10, 11 and 12 provide a summary of employee expenses processed in other systems than SumTotal. June 20, 2012 Meeting with OAG Provide direct testimony addressing improvements made in reporting to show compliance. Husen Direct, Section III A, SumTotal, discusses SumTotal features. Husen Direct, Section III C, Internal Controls and Monitoring, describes how the Company is monitoring compliance with the Employee Expense Policy and appropriate reporting of employee expenses. Northern States Power Company June 20, 2012 Meeting with OAG Provide direct testimony regarding training to address entry of meal expenses in SumTotal. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 5 of 6 Husen Direct, Section III A, SumTotal, discusses SumTotal training and other resources provided to our employees to accurately document and approve employee expense transactions in SumTotal. Husen Direct, Schedules 5A, 5B, and 5C provide copies of SumTotal training materials and job aid manuals, which also address entry of meal expenses. June 20, 2012 Meeting with OAG Provide direct testimony regarding how recognition Husen Direct, Section V, Employee Expense issues (including gift cards) are handled. Review and Development of EER Schedules, page 37-38, discusses employee recognition expenses. June 20, 2012 Meeting with OAG Prior to the next rate case filing, check with the OAG to confirm best way to present EER Schedules. Met with the OAG shortly before filing this rate case. June 20, 2012 Meeting with OAG EER Schedules to contain the gross amount as well as the NSPM company amount. Husen Direct, Schedule 8 provides details of the data and process used to develop the EER Schedules. The EER Schedules contain the gross amount as well as the NSPM company amount. September 3, 2013 Commission Order (GR-12-961), (superseded by the May 8, 2015 Commission Order) Provide flight data reports for the most recent 12month operational period, including charged employee, each employee passenger and their assigned operating company, other passengers and their reason for use, and primary purpose for using the flight. Husen Direct, Section I, Introduction, states that the Company is not requesting recovery of any corporate aviation expenses in this rate case. Husen Direct, Section II, Definition and Governance of Employee Expenses, states that because the Company is not requesting recovery for any corporate aviation expenses in this rate case, we have not provided the flight log information. Northern States Power Company September 3, 2013 Commission Order (GR12-961) Provide information for the calculation of the requested recovery amount of corporate aviation. May 8, 2015 Commission Order (GR13-868) In future rate cases seeking recovery of corporate aviation, provide more detailed, accurate records of the actual business purpose for flights that are scheduled, rather than reducing all flights to a generic "code." Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 4 Page 6 of 6 Husen Direct, Section II, Definition and Governance of Employee Expenses, states that although the Company is not requesting recovery of any corporate aviation costs in this rate case, EER Schedule 8 provides expense data related to corporate aviation to ensure completeness. The Company is not requesting recovery of any aviation expenses in this rate case and consequently, is not providing more detailed records of the actual business purpose for flights. Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 1 of 48 Updated 1/1/2019 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 2 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 3 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 4 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 5 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 6 of 48 Northern States Power Company LMS Training: 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Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 26 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 27 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 28 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 29 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 30 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 31 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 32 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 33 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 34 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 35 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 36 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 37 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 38 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 39 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 40 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 41 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 42 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 43 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 44 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 45 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 46 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 47 of 48 Northern States Power Company LMS Training: Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5A Page 48 of 48 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 1 of 59 <Corporate Card Department > Procedure Name: <SumTotal Reconciliation-- Creating and Submitting Expense Reports > Responsibility: Primary: <Card Holders> Backup: <SumTotal Admins> Frequency / Due Date: <Monthly, Every 30 days> Summary / Background: A detailed process of how to create and submit an expense report, for expenses incurred on the BMO Purchase Card and Fleet Cards. Also, a detailed process of how to get reimbursed and how to pay back the company for Personal Expenses. Required Tools and System Access: (1) SumTotal (2) XpressNet (3) Contacts: Name Amanda Ornelas Karolyn Hedquist Vanessa Villa E-Mail Address Amanda.L.Andrews@xcelenergy.com Karolyn.T.Hedquist@xcelenergy.com Vanessa.Villa@xcelenergy.com Phone Number 303-439-5834 303-628-2648 303-439-5801 Department / Title Corp Card Depart Corp Card Depart Supervisor < S:\MDC-MD\SCPC\SCS > Page 1 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 2 of 59 Procedure: Detailed Process Step One-- Log Into SumTotal 1. From XpressNet, click on Expenses from the Main Menu - Your SumTotal password will automatically be changed every time you change your network password. 2. SumTotal Home Page- - To remove notifications, select the check box to the right of the notification, or to select all, click the check box on the title bar and click Remove. - This will clear all of the notifications. < S:\MDC-MD\SCPC\SCS > Page 2 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 3 of 59 3. To Log Out of SumTotal, user will click on the Logout button in the top right corner of the screen. 4. System will close and access to SumTotal will require a password to get back in. Step Two- Create and Expense Report 1. Under the Personal Actions list, select Create an Expense Report. - Employees will submit one expense report per month. - Credit card transactions must be reconciled every 30 days. Pick a day to always complete your expense reports and do so every 30 days. A 15 day grace period exists before notifications will be sent regarding delinquency of transactions based upon transaction posting date. Day 46 spender and manager will receive delinquency notifications daily until the transaction is included in an expense report. 60 day delinquencies will cause card to be suspended and 90 days, card will be closed. - Example: If the spender picks the 15th of each month to prepare expense report on that expense report the spender should include all transactions prior to the 15th of that respective month to be included in the expense report. The spender will get a 15 day courtesy notice to complete an expense report based upon transaction date. - Employees who are on Short Term Disability (STD) or Long Term Disability (LTD) will not be able to use their company BMO card. Managers should notify Supply Chain Hotline to temporarily suspend card until further notice. - For more information on the policy please access the 10.2 here: 10.2 Travel and Employee Expense Reimbursement < S:\MDC-MD\SCPC\SCS > Page 3 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Step Three- Create a Report Header 1. Expense Report Header Screen- Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 4 of 59 2. Report Name- Include Month/Year of expenses (i.e. July 2017 Expense Report). The name should be descriptive of time period of expenses included in report. 3. From- The first date will be the first date of expense items on your report and the second date will be the last date of expense items. To select a date, click on the calendar icon and click on the specific date. - If your expenses do not fall within that date range, it will flag the report as being not policy compliant. This will make the report go to audit after manager approval. - Once the report has been submitted, the user cannot change the date range even if it has been rejected back to the employee. < S:\MDC-MD\SCPC\SCS > Page 4 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 5 of 59 4. Certify Compliance- Click the empty box next to the compliance message to check mark that you have read and understand the compliance message. - Managers will reject expense report(s) if compliance checkbox is not checked. 5. Verify all fields with a red (*) are filled out completely and efficiently, then click on the Continue Button. - This will take the user to the Add Expenses Screen. Step Four- Add Credit Card Transaction(s) to Expense Report 1. Click on the Include Transactions tab. - If the expense(s) have not came through to your include transactions, do not go to the add expense tab and do them as Cash Out Of Pocket. Wait until the expenses show up in the include transactions and then include them in your expense report. < S:\MDC-MD\SCPC\SCS > Page 5 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 6 of 59 2. A list of all credit card transactions to be included in an expense report will be displayed. 3. To add a SINGLE transaction to the expense report, click on the box next to the individual transaction in the list and then click on include. 4. To add ALL of the transactions listed in the include transactions tab, click the check box on the title bar. 5. Once the transactions have been selected that need to be included, click on the Include button towards the bottom right. < S:\MDC-MD\SCPC\SCS > Page 6 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 7 of 59 - If disputing fraudulent charges contact BMO directly. You will dispute the charges and BMO will do an investigation, and if they deem them as truly Fraudulent they will send a credit to your card. 6. The selected transaction(s) have moved to the Included Expenses section on the Edit Expense Report in the View Summary tab. - The Red icon to the left of expense indicates the expense is missing required information. 7. Double click on the expense item to edit. 8. System displays transaction information on the Edit Expense View pane. 9. Bank transaction information populated in gray (user cannot edit): - Date-The Date the expense incurred from merchant. - Posting Date-The Date that the transaction(s) are received from MasterCard. - Merchants Name-The name of the merchant where the expense was incurred. < S:\MDC-MD\SCPC\SCS > Page 7 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 8 of 59 - Spent Amt.-Credit Card Transaction Amount. - Currency- USD, SEK, CAD, etc. - Payment Method-BMO MasterCard, Cash Out of Pocket, etc. 10. The populated fields that can be edited and the information that's required to be populated are the fields with a red (*) next to them. - Expense Type- Select the correct expense type from the drop down options. - Region- State where the expense was incurred. - Area- City where the expense was incurred. - Receipt- Select Not required, Receipt Included, Lost or VAT Receipt Included. · Receipt field will default based on expense type selected. Per 10.2 Policy- Itemized Receipts are required for all expense types except: T- Taxi/Bus/Other T- Parking T- Tips/Tolls · These will default to Not Required, however a receipt is required for all expense(s) equal to $25 and over, therefore in these circumstances a basic receipt with the amount will need to be provided and the Receipt field will need to be changed to Receipt included. · Itemized receipts are required to substantiate expense reimbursements. An Itemized receipt details items and amounts, sales tax paid and total amount. The Credit Card Slip that is signed for MasterCard is NOT an itemized receipt. · Users can scan the credit card receipts along with the itemized receipt. However the Itemized receipt is the required documentation. If the tip amount is not included on the itemized receipt then the credit card receipt with the tip amount and total amount is required along with the itemized receipt. · Users and approving managers are required to ensure itemized receipts are provided with expense report(s). If receipt is lost, user is required to mark the Receipt field as "Lost" and fill out the "Lost Receipt Form" , then scan and upload with expense report. · PII = Personal Identifiable Information- review the receipt if the full credit card number is legible, black it out so that it cannot be seen prior to scanning. Also if you owe money to Xcel and you scan a check in, please make sure you black out the acct. number, routing number and < S:\MDC-MD\SCPC\SCS > Page 8 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 9 of 59 address. · Cross out credit card number on receipt if more than 4-digits are showing. Step Five- Select Purchase Expense Type and Fill in Required Fields 1. Purchase type expense is reconciled at the expense level (not itemized). - Expense Types are grouped by "M" (Meals), "P" (Purchase) and "T" (Travel) categories. - All Meal type expenses require itemization at line item level to identify meal vs. alcohol portion of the expense. - T-Hotel requires itemization to break down; room rate, tax, etc - All other expense types are reconciled at expense level. 2. Click on down arrow in Expense Type field and Select a purchase expense type (preceded by "P"). 3. Enter Business Purpose - The business purpose is a detailed description of the business reason for the expense item. It must adequately describe why the expense was incurred. - Users will enter a business purpose for each expense added to an expense report. · The Business Purpose should include detailed information about why the expense was incurred. Meal/Training is not valid. · The Description field (box) can be used for further explanation for < S:\MDC-MD\SCPC\SCS > Page 9 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 10 of 59 expense if required. Examples- Fork Lift Training in Denver SAP Users Training in Denver - When using expense types Other Purchase and Other Travel a description is required. 4. Click on TAX INFO tab to open Tax panel to enter sales tax information. Step Six- Enter Sales Tax for Purchase Expense Type 1.Merchants should charge tax on all credit card transactions. Sales tax amount will be populated for credit card transactions if merchant sends data in the following fields: - Sales Tax Paid- Yes or No - Amt. of Sales Tax Paid- this will be the amount of tax paid to vendor. - Facility Code- Should automatically populate. 2.Click on Sales Tax Paid drop down arrow and Select Yes if sales tax was paid per receipt. 3.Click in Amt. of Sales Tax Paid Enter amount of sales tax paid from the itemized receipt. 4.Change Facility Code, if applicable. - Facility Code defaults facility from user's profile. Facility Code is used to identify where you took possession of item(s) purchased or expects to use. Select appropriate facility code, if material was shipped/used at a location different than the users' facility. < S:\MDC-MD\SCPC\SCS > Page 10 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 11 of 59 - All facility codes are loaded. You may need to scroll down and/or select the Next button for additional facilities. 5.Some Expense Types that do not require tax are: - Expense types that do not require tax will not have the tax tab. 6.If no sales tax was paid click on the Sales Tax Paid drop down arrow and select no. 7.The amount of sales tax will automatically be set at 0.00. 8.Change Facility Code, if applicable. 9.Select Exempt Code that describes why tax wasn't paid from the drop down menu. - If sales tax should have been paid but was not, select reason code "XXX-NOT EXEMPT-USE TAX OWED." This code informs the Tax Department to accrue and pay tax. 10. Click TAX INFO tab, a second time, to exit tax panel. 11. Once all tax information is added, allocate expense to the appropriate accounting. < S:\MDC-MD\SCPC\SCS > Page 11 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 12 of 59 12. Click Allocation button to navigate to Allocation pane. Step Seven- Allocate Expense to Single Accounting String 1. There are 3 ways to allocate an expense: - Allocate Single Acct - Split Allocations - Add Split Allocation to Preferences - Pre-Define Split Allocation 2. To begin allocation to single accounting string click on Modify Allocation. 3. Click on the drop down arrow next to Order Number. 4. Either select the correct order number from the drop down options or type in the order number in the search box and click search. < S:\MDC-MD\SCPC\SCS > Page 12 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 13 of 59 5. Click on the correct options and it will populate in the Order Number field. - User can use wild card (*) to narrow search results. Enter first 2 or 3 digits of account segment (Business Unit, Sub ledger, etc.) and add (*) then click search. - If IO number or allocation is unknown reach out to your manager. 6. Users have the ability to define and save split allocations to preferences. 7. Click on the Create Split Allocation radial. 8. Put in the percentage that you want to go to that Allocation Order Number in the percentage field. < S:\MDC-MD\SCPC\SCS > Page 13 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 14 of 59 9. Make sure your Order Number is correct for where you want this to be charged to, and then click on the Add Split Item button. 10. This will bring the percentage and the Allocation amount under the Allocation Summary. 11. To Save the formula to your preferences click on Add Formula to Preferences. 12. In this screen you will fill out all the fields with a red (*). - Name- Name of the Preference - Start Date- When you want this preference to start. - Order Number-The Order number you want to charge to. < S:\MDC-MD\SCPC\SCS > Page 14 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 15 of 59 13. Once you have filled in all the required fields, click done. 14. Pre-Defined Split Allocation Option is a saved option that has been saved from a previous report. 15. To Delete Split Allocations, click on the box next to the specific split allocation that needs to be deleted. 16. Click on the Delete Button. 17. Click on the radial next to Select Pre-Defined Split Allocation. 18. There will be a drop down field option that will populate. 19. Click on the drop down arrow and select one of the pre-defined options to use. < S:\MDC-MD\SCPC\SCS > Page 15 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 16 of 59 20. This will automatically populate the percentages and the order numbers that need to be used. 21. After allocating click done. 22. System returns to Expense View on Edit Expense panel. 23. Click the Save Changes button or all your information will be lost. < S:\MDC-MD\SCPC\SCS > Page 16 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 17 of 59 24. System displays View Summary tab on Edit screen with expense added to Included Expenses section. 25. Hover over the Green Diamond and it will say External Validation Successful. - The system will perform the accounting validations and display a green icon and hover over message that states "External Validation Successful" at the expense report line level (main expense) 26. Click on the Save Report button to save report in draft status. Step Eight- How to Scan and Upload Receipts 1. PII = Personal Identifiable Information- review the receipt if the full credit card number is legible, black it out so that it cannot be seen prior to scanning or if a check is being uploaded to receipts. Black out the banking information at the bottom of the check. 2. The PDF image below provides step-by-step instructions on how to login and use the Global Scan feature for the Ricoh devices is located: - Scanning Receipts 3. Copies of receipts are reviewed during audits. Ensure that the receipts are legible and that you upload the correct receipts as these become a permanent record of each expense report. 4. Access the expense report from SumTotal home page. < S:\MDC-MD\SCPC\SCS > Page 17 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 18 of 59 5. Click on the report that you want to drill into and then it will take you to the View Summary Home Screen. 6. Click on the Expense Line. 7. Click on Upload Receipts. 8. Click on Select File. < S:\MDC-MD\SCPC\SCS > Page 18 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 19 of 59 9. Find the document that you have scanned into your documents to upload. Please keep in mind that the system will only allow you to upload 2MB per file. If it's more than that you'll have to split them up. - If the receipt are coming through blank, prin out the receipt, scan ther receipt to your home folder, and then upload. - Do not try to upload more than 20 pages at one time, otherwise the user could experience an error. 10. Once the file has been located, click on Open. 11. This will bring the file name into the display. - User can browse and upload multiple documents by continuing to click Select File and selecting the applicable document to upload. - Standard upload amount is 20 pages. If more than 20 then break down into two separate scanning groups 12. Click Upload. < S:\MDC-MD\SCPC\SCS > Page 19 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 20 of 59 13. User will get a "Successful" page, if the receipts were uploaded correctly: 14. Click on Return and it will take the user back to the Expense View page. 15. This will upload the selected receipts to this specific expense line. - If unsuccessful the system will advise that the files were not uploaded. Proceed to make the files smaller and upload more than one file. 16. Click on View Receipts button to ensure you have attached all required receipts by line. - It may take up to 5-10 minutes for the file to be viewed. Please wait a few moments and try again. - The Corporate Expense system will retain all records in accordance with the Corporate Record Retention policy guidelines. 17. User can also view receipts on the receipts by clicking on the View < S:\MDC-MD\SCPC\SCS > Page 20 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 21 of 59 Summary Tab, and then clicking on View Receipts. 18. In this view, it will put a time stamp on the expense receipt and the amount. < S:\MDC-MD\SCPC\SCS > Page 21 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 22 of 59 Step Nine- Submit Expense Report 1. After receipts have been successfully scanned and uploaded to expense report, Click Submit. - The system validates the accounting string at the time of Submittal, once again, to ensure the validation is still successful and/or indicates if you have additional transactions. - Users may receive warnings if there are additional transactions that are ready for inclusion. Select continue if you don't want to add more transactions to your current expense report. < S:\MDC-MD\SCPC\SCS > Page 22 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 23 of 59 2. System will display a Confirmation window. 3. Click OK and then Done. 4. Expense report is now submitted for MA Approval (Management Approval). Specific Details Add Meal Expense Type 1. Click on down arrow in Expense Type field and Select a Meal expense type (preceded by "M"). - There are 2 Business Meal Expense Types and 1 Travel Meal Expense Type. · Business Meal Employee Only- This expense type is to be used if business cannot be reasonably conducted during regular business hours, and only Xcel Energy Employees are in attendance. · Business Meal Non-Employee-This expense type is to be used if business cannot be reasonably conducted during regular business hours and there are guests. (Contractors, Interns, Business Partners, etc.) Even if there is only 1 guest, Business Meal Non-Employee needs to be used. · Travel Meal- Travel Meals are generally for each individual while traveling on company business. 2. SumTotal provides the ability to flag an expense based on 10.2 Employee Expense Reimbursement policies. < S:\MDC-MD\SCPC\SCS > Page 23 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 24 of 59 3. The expense will be flagged with a yellow icon to the left of an expense when Expense Type exceeds policy spend/cap: - System will flag a meal type expense when total amount of all meals per day expensed by spender exceeds $65 Daily Meal Allowance. 4. Users will enter a business purpose for each expense added to an expense report. - The Description field can be used for further explanation for expense, if required. 5. Enter the Number of Persons that attended the meal. - Make sure that the number of persons matches how many attendees are listed in the attendee tab (20 attendees and under) or on your uploaded attendee sheet (over 20 attendees). - System will calculate Unit Amt. for each person 6. Enter any other required information, if not populated. 7. Click on the Tax Info Tab. 8. Click on Sales Tax Paid drop down arrow and select yes. < S:\MDC-MD\SCPC\SCS > Page 24 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 25 of 59 9. Click in Amt. of Sales Tax Paid field, highlight the zeros and delete. Then enter amount of sales tax. 10. Click on TAX INFO tab to close tax screen 11. To Allocate Expense Line, user can allocate at the expense level or at the expense line (sub expense) level. 12. Click the Allocation button to allocate the expense line. 13. System displays Add Expense: Allocation on Expense View screen. 14. There are 3 ways to allocate an expense: Please see Step 7 for Allocation instructions. 15. When allocation is completed, click done. 16. System returns to Edit Expense pane on Expense View screen. 17. Next, click the Attendee button. < S:\MDC-MD\SCPC\SCS > Page 25 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 26 of 59 Add Attendees from Global Xcel Employee List 1. System displays Add Attendees on Expense View screen. - System defaults user as attendee 2. Click Add Attendee. 3. Click on prompt arrow next to blank Attendee name field. - If your attendee list is 20 and under you must enter them in the attendee tab and if your attendee list is over 20, you can upload an attendee sheet into your receipts. (If you have multiple meals with attendees over 20, please make sure you label the sheet to whatever meal it belongs to so we know which list goes with the correct meal.) 4. System displays global list of all employees. - User can search by the Following Criteria: < S:\MDC-MD\SCPC\SCS > Page 26 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 27 of 59 · Attendee Name-Employees Name · CORP ID-Employees ID · Company - Change the Drop Down option to match what you are searching by. 5. Type in the search box the attendee information and click Search. - This will bring up all Employees within that search criteria. 6. Select the Attendee by clicking in the check box next to the employee name. 7. Click Add to add them to the attendees. - Repeat this process to add as many attendees as necessary. - All your added attendees will be listed here. < S:\MDC-MD\SCPC\SCS > Page 27 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 28 of 59 8. Click Save and Return once all the attendees have been added. 9. To Add Non-Employee Attendees, click on the add Attendee button. 10. Enter in Attendees Name. 11. Enter "XXX" in Corp ID Field. 12. Click Business Relationship drop down arrow and select Guest. 13. In the Company field enter the company that they work for. 14. Click Save and Return if no Preferences needed. 15. Adding Attendees to Preferences creates a preferred list of attendees for easy selection on future expenses. 16. Select employee listed under Add Attendees by clicking check box to the right of name(s). 17. Click Add to Preferences. - You can select all on list by clicking on the check box on header section of screen < S:\MDC-MD\SCPC\SCS > Page 28 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 29 of 59 18. System displays pop up window with message "Are you sure you want to create a new attendee entry in your list?" 19. Click Yes. 20. System saves selected employees to your Attendees-Preferences list. 21. Click Save and Return. 22. View Preferred Attendees list by Clicking Add Attendee, and Click on prompt arrow next to Attendee Name field. 23. System displays preferred list of all employees added to Preferences by clicking on the drop down arrow next to Show and select Preferred. 24. Select the Employees and add them to your attendee list. 25. Click Save and Return button. < S:\MDC-MD\SCPC\SCS > Page 29 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 30 of 59 Itemizing Expenses 1. Users are required to itemize all meal type expense(s). 2. Click on the Itemize Button. - All Meal type expenses require itemization at line item level (sub expense) to identify meal vs. alcohol portion. 3. Xcel Energy must identify meal vs. alcohol portion when applicable and account for expenses appropriately. 4. System displays Add Expense Item on the Expense Item View panel. 5. Spent Amount will display from expense 6. Click on down arrow in Expense Type field to display a list of Sub Expense types. 7. Select the Correct Meal Expense type- Business Meal Employee Only, Non-Employee or Travel Meal. 8. If amount is meal only Enter entire amount in Spent Amt. field. 9. Click on the Allocation Button. 10. Refer to Step 7 for Allocation process. < S:\MDC-MD\SCPC\SCS > Page 30 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 31 of 59 11. Once Allocation is complete, click Add Item. - The system displays a "Grey" validation icon with a hover over message stating "Allocations haven't been externally validated" as the sub expenses have not been added to Included Items yet. 12. This will add the item to the Included Items Section. 13. Click on the Return Button. 14. Click on Save Changes button to save the information added to the expense. 15. If no validation errors occur, the system displays a green icon to the right of the expense line. 16. Click "+" to the left of expense to expand and view sub expense(s). 17. System will display a hover over message that states "External Validation Successful" at the expense report line (sub-expense) < S:\MDC-MD\SCPC\SCS > Page 31 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 32 of 59 18. Click on the Save Report button to save report in draft status. Editing/Viewing Attendee Preferences 1. To access your Attendee preferences, go to your Expenses Home Page. 2. Click on Edit User Preferences. 3. Click on Preferences tab. < S:\MDC-MD\SCPC\SCS > Page 32 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 33 of 59 - System displays list of attendees added to preferences. - User can add additional non-employees on this panel. 4. Click Add Attendee button. 5. Enter attendee name, title and company 6. Select Guest from drop down arrow of Business Relationship field. 7. Click Save button 8. To Remove Attendees from the Preference Tab, click on checkbox next to attendee you wish to delete and click delete. - You can select all by clicking on the check box above the list < S:\MDC-MD\SCPC\SCS > Page 33 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 34 of 59 9. System displays pop up window with message "Delete the selected attendee(s)?" 10. Click YES. 11. Attendee is removed from Preferences 12. Click Save button to save changes. 13. Click Close button to return to SumTotal home page Adding Proxy Submitter's and Approver's 1. Proxies are added to create and submit expense reports on behalf of a user. 2. To Add a Proxy Submitter, click on the Proxies tab under Manage User Profile. < S:\MDC-MD\SCPC\SCS > Page 34 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 35 of 59 3. Click the prompt arrow next to the Submitter Field. 4. System displays list of all active SumTotal Users. 5. Search for the employee. - Easiest way to search is by the employee last name. Type in the employee last name in the search box, click on the drop down arrow, select Last Name and then click on Search. 6. This will display all employees within that search criteria. 7. Click on desired employee to add as Proxy Submitter. 8. Selection is added to Proxy Submitter list. < S:\MDC-MD\SCPC\SCS > Page 35 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 36 of 59 9. Click on the calendar next to the Start Date Field to select Proxy submitter Start Date, which will display in this field once identified. - Enter End Date if proxy submitter will only be a proxy for a limited time. - Leave End Date blank if proxy is indefinite. 10. User can have multiple Proxy Submitters. 11. When manager assigns a Proxy Approver, they will include the start and end date for the duration. 12. Expense reports submitted for approval will be sent to the proxy approver only, once one is assigned. 13. To add a proxy approver click on the prompt arrow next to the Approver field. 14. Follow same steps for searching for an employee. 15. Click on desired employee to add as proxy approver. 16. Selection is added to proxy approver. 17. Click on calendar to select proxy approver Start Date. 18. Enter End Date the proxy approver will no longer need to approve expense reports on your behalf. - All expense reports submitted for approval will be sent to the proxy approver: (based on Start and End Date) - Be sure to always enter End Date for proxy approver. If no End Date is entered all expense reports submitted will continue to be sent to proxy approver until End Date is entered. - User can have only one proxy approver during a given time < S:\MDC-MD\SCPC\SCS > Page 36 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 37 of 59 Adding Hotel Expense Allocation and Itemization 1. Expense types which require pre-approval documentation to be obtained and provided with receipts are: - Spousal Travel - International Travel 2. Users will enter a business purpose for each expense added to an expense report, and The Description field can be used for further explanation for expense if required. 3. Click on down arrow in Expense Type field and select T-Hotel expense type. 4. Enter Business Purpose- Must adequately describe why the expense(s) was incurred. 5. Click Allocation button- Refer to Step 7 for allocation process. 6. Once the Allocation is complete, click the Itemize button. 7. System displays Itemization Wizard for Recurring Expenses. 8. The Wizard should only be used for reoccurring charges (room rate, taxes, etc.) < S:\MDC-MD\SCPC\SCS > Page 37 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 38 of 59 9. Enter Start Date (first night) and Enter End Date (last night), by clicking on the calendar next to each field. - System will calculate Number of days 10. Click drop down arrow to select TS-Hotel-Room Rate Sub Expense 11. Enter the Room Rate Amount and click on add. 12. System displays fields for additional items to be selected. 13. Select TS- HOTEL- Room Tax and enter the amount. 14. Remaining Amt. field will display remaining amount that needs to be itemized, if all is itemized correctly the remaining amount should be 0.00. - Hotel must be itemized out by Room Rate and Tax, per day/night of stay. < S:\MDC-MD\SCPC\SCS > Page 38 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 39 of 59 15. Once the Room Rate and Tax have been entered, click the done button. 16. Expense will show itemization by day in the included Items section. - The system adds a "Grey" validation icon with a hover over message that states "Allocations haven't been externally validated" as the sub expenses have not been saved to "Add Expense" yet. 17. Click Return button 18. Click Save Changes button 19. If no validation errors occur, the system displays a green icon to the right of the expense line 20. System will display a hover over message that states "External Validation Successful" at the expense report line (sub-expense) level. 21. Click Save Report button Credit Card Transaction Marked Personal 1. Personal use of the corporate card is limited to incidental use only. 2. Incidental use is when the personal portion of an expense is less than 50 percent of the combined business and personal expense amount. 3. If the personal expense is greater than the 50 percent of the total expense amount, the Employee should claim the business expense as "cash out of pocket" on an expense statement. 4. Personal expenses (e.g., movies, toiletry articles, etc.) are not reimbursable. < S:\MDC-MD\SCPC\SCS > Page 39 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 40 of 59 5. If an Employee accidentally uses a personal credit card for business travel or business-related expenses, the approving Leader can approve the expense along with the proper supporting original itemized receipt documentation. 6. In instances where the Corporate Credit Card is not accepted, the employee should claim the business expense as "cash out of pocket" on the expense report and the approving Leader can approve the expense along with the proper original itemized receipt documentation. A description as to why this happened must be put in the description box; i.e. Company Doesn't accept card, Card machine not working, etc.. 7. Cash out of pocket expenses are monitored to ensure the Corporate Credit Card is used appropriately. Indicating Entire Expense Personal 1. From the View Summary Screen, click on the transaction/expense that needs to be marked personal. - All credit card transactions that have been included on a report will have a "Grey" icon and hover over message that states "Allocations haven't been externally validated" until the validation has taken place after saving the expense line to the expense report 2. Select Personal check box. 3. When the personal box has been checked the expense type, business purpose, allocation and Itemize fields are no longer required. 4. These do not need to be filled in if the whole transaction will be marked personal. 5. Click Save Changes button. < S:\MDC-MD\SCPC\SCS > Page 40 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 41 of 59 6. The system returns the user to the View Summary screen. 7. Expense is added to Included Expenses sections. 8. System displays a "Grey" icon with a hover over message stating "Allocations haven't been externally validated". - The diamond will stay grey when an entire purchase is marked as personal. 9. Click Save Report button to save report in Draft status. 10. Amount Owing to Company in Report Totals. - This is the amount that the employee owes the company. 11. When your report is complete the Amount Owing to Company will be the amount that the user will have to reimburse the company. 12. A check or money order will need to be sent in for the EXACT amount along with the follow Amount Owing Xcel Energy Check Submittal Form. 13. The form can also be found by clicking on Forms under Quick Links on SumTotal home page. 14. This form is required to be completed and sent with check/money order payable to Xcel Energy. 15. The object account is the liability account where expenses that are marked as personal in Expense Report are booked to GL. This liability is cleared when check/money order is received and processed by < S:\MDC-MD\SCPC\SCS > Page 41 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 42 of 59 Customer Receivables. Object Acct field is pre- populated for this reason. 16. Enter Operating Co. #. This is the company you reside in. 17. 10 = NSP-MN 11 = NSP-WI 12 = PSCO 13 = SPS 50 = XLS 18. Click on Print Form button. 19. Attached check/money order for amount owed, payable to Xcel Energy. 20. Mail completed form with check to Customer Receivables-3115 Centre Point, Roseville, MN 2nd Floor Indicating a portion of Expense as Personal 1. Click on the transaction that will have a portion marked personal. 2. Enter Expense Type and other required information. 3. Click on Allocation button. 4. Click on Create Split Allocation radio button. 5. Click in the percentage field and do the percentage that is to be marked personal. < S:\MDC-MD\SCPC\SCS > Page 42 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 43 of 59 6. Click on the Personal check box and then click on the Add Split Item button. - Once the "Personal" checkbox is selected the system removes the allocation details. 7. Allocations display in Allocation Summary section of screen. - The system displays personal item with no account element data displayed. - This item is not associated with a Business Unit cost. There will be no order number, only the percentage and the Allocation Amount will display. The diamond next to the Allocation Amt. should be grey. 8. Click done button. 9. System displays Edit Expense on Expense View screen. 10. Continue with the Tax Info. Refer to Step 6. < S:\MDC-MD\SCPC\SCS > Page 43 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports 11. Click Save Changes button. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 44 of 59 12. Expense is added to the included expenses section in the View Summary Screen. 13. The system will perform the accounting validations and display a green icon and hover over message that states "External Validation Successful" at the expense report line level (main expense). 14. Click Save Report button to save report in Draft status. - Report remains in draft status until submitted for approval. < S:\MDC-MD\SCPC\SCS > Page 44 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 45 of 59 Transaction with Expense Line Item (sub-expense) Marked Personal 1. Click on transaction added that needs to be itemized as personal. 2. Select Expense Type that requires itemization (sub-Expenses); (e.g. M-Meal, M- Recognition, etc.). 3. Enter required information. 4. Click on Attendee button. 5. Enter Attendees. Refer to Step Add Attendees from Global Xcel Employee List. 6. Click Itemize button. 7. Click drop down arrow and select Sub Expense Type. < S:\MDC-MD\SCPC\SCS > Page 45 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 46 of 59 8. Enter amount of expense line item (sub-expense). 9. Click Allocation button. 10. Refer to Step 7 for Allocation instructions. 11. Click Add Item button 12. System saves and displays sub expense in Included Item on the Expense Item View screen. 13. Spent Amt. displays with remaining amount to expense. < S:\MDC-MD\SCPC\SCS > Page 46 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 47 of 59 14. Enter Spent Amt. for personal portion remaining. 15. Click on Personal checkbox. - Allocation button is removed 16. Click Add Item. 17. System returns to Edit Expense Item pane on Expense Item View screen. 18. Expense Item is added to Included Items pane and is marked Personal. - Check remaining Amt. equals zero when sub expenses are added. 19. Click Return button. 20. Click Save Changes button. 21. Expense is added to Included Expenses sections. 22. The system will perform the accounting validations and display a < S:\MDC-MD\SCPC\SCS > Page 47 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 48 of 59 green icon and hover over message that states "External Validation Successful" at the expense report line level (main expense). 23. Click Save Report button to save report in draft status. Enter Cash Out of Pocket Expense 1. Per policy, employees are required to use the Corporate Credit card for business related expenses. Cash out of pocket expenses should be limited to mileage reimbursements and other items when card is not accepted or practical (Tips/Tolls, parking meters, etc.). 2. Cash out of pocket expenses are entered on Add Expense Tab. All subsequent screens will refer to Add Expense. 3. System displays Add Expense tab on Edit screen. 4. Click on down arrow in Expense Type field and Select the correct expense type. 5. Enter Information in all required fields. < S:\MDC-MD\SCPC\SCS > Page 48 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 49 of 59 6. Enter Business Purpose for the expense. 7. Click Allocation button. 8. Make sure that the Payment Method is Cash out of Pocket. 9. Enter in the Spent Amount. 10. The receipt field will always say Receipt Included because All Cash out-of-pocket expenses require an itemized receipt regardless of amount; exceptions include reasonable tips and tolls. 11. Click on the Allocation Tab. Refer to Step 7 for the 3 Ways to Allocate. 12. Once Allocation is complete, Click Add Expense button. 13. System displays Add Expense on Add Expense tab. 14. Added expense is displayed in Included Expenses section. < S:\MDC-MD\SCPC\SCS > Page 49 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 50 of 59 - If no errors occur, system displays green icon (right of the expense line) with hover over message, stating "External Validation Successful". 15. Click Save Report button to save report in draft status. Add Mileage expense 1. 2. 3. Per Corporate Policy, Xcel Energy only reimburses mileage for use of personal vehicle for company business. Xcel does not reimburse gasoline as additional expense; gasoline. There are 2 expense types for mileage reimburses; T-Personal Car Mileage This expense type is selected when single round trip (i.e. MDC to 1800 Larimer and back to MDC); T-Multi-Trip Mileage This is used when traveling to multiple locations for business related activities. T-Multi-Trip Mileage requires a Mileage Log be attached as a receipt to substantiate the mileage claimed Single Trip mileage. From the Add Expense tab select Expense Type (T-Personal Car Mileage). 4. Enter Required Information. < S:\MDC-MD\SCPC\SCS > Page 50 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 51 of 59 5. Enter total number of miles for single trip (round trip). - System calculates the number of miles entered times the mileage rate stored within the system. 6. To complete required data click on Mileage button. 7. Enter Point of Departure and Destination. 8. Select Round Trip check box. - Number of miles entered in previous screen is defaulted in Distance field. < S:\MDC-MD\SCPC\SCS > Page 51 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 52 of 59 9. Click on Save and Return button. 10. Refer to Step 7 for Allocation Instructions. 11. Click Add Expense button. 12. If no errors occur, system displays a green icon (to the right of the expense line). If the user hovers over the "Allocation" the system will display a hover over message that states "External Validation Successful". 13. Expense is added to Included Expenses. 14. Click Save Report button to save report in draft status. 15. Mileage Multi-Trip. 16. From the Add expense Tab, select Expense type T-Mileage- Multi- Trip Expense Type. 17. Enter Required Information. They will all have red (*) next to the required information. < S:\MDC-MD\SCPC\SCS > Page 52 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 53 of 59 18. Enter total number of miles for multi-trip. - System calculates the number of miles entered times the mileage rate stored within the system. 19. Refer to Step 7 for Allocation Instructions. 20. Mileage button is not required. The mileage log is required documentation and will be used as the receipt. Scan the mileage log and upload to expense report with all receipts. 21. Click Add Expense. 22. Expense is added to Included Expenses. 23. If no errors occur, the system displays a green icon to the right of the expense line. If the user hovers over the "Allocation" the system will display a hover over message that states "External Validation Successful" 24. Click Save Report button to save report in draft status. < S:\MDC-MD\SCPC\SCS > Page 53 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 54 of 59 Removing Pre-Defined Allocations 1. From SumTotal home page, Click on Edit User Preferences link under Personal Actions. 2. Click on Defaults tab. 3. Click Delete button. 4. System removes defined allocation selected. 5. Click Save button. Review Policy Info Tab 1. SumTotal provides the ability to flag an expense based on 10.2 Travel and Employee Expense Reimbursement. 2. The expense will be flagged with a yellow icon to the left of an expense when Expense Type exceeds policy spend/cap: - System will flag Life Event expense type when amount per person is greater than $70. - System will Flag Holiday/Celebration expense type greater than $35 dollars per person. - Other Expense Types are flagged to ensure appropriate use. < S:\MDC-MD\SCPC\SCS > Page 54 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 55 of 59 · Other Purchase · Other Travel - The System will also flag Meal expenses that are over the $65 daily meal allowance. 3. All expense reports with flagged expense(s) will be sent for back office audit review. Non-compliance is monitored and reported on a monthly basis. 4. The system will display policy tab on expense which includes policy details of the flagged expense. 5. The Policy Info tab will explain why the expense is a violation of policy. 6. Once all of the required information has been entered and user clicks on Save Changes. The following message will pop up. 7. System displays error regarding policy violations and required action to be taken. 8. Description is required Enter explanation of why amount exceeds policy limit 9. User has option to either Ignore for Now or Change Now. 10. Expense is added to Included Expense section with red icon < S:\MDC-MD\SCPC\SCS > Page 55 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports displayed to the left. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 56 of 59 11. Grey Icon and hover over message Allocations haven't been externally validated. 12. Double click on expense to open. 13. Enter explanation in the Description box as to why amount exceeded policy limit. 14. Click Save Changes button. 15. Expense is added to Included Expenses section with yellow icon displayed to the left of expense. 16. The system will perform the accounting validations and display a green icon and hover over message that states "External Validation Successful". 17. Click Save Report button to save in Draft Status. 18. This will still be sent to Audit for Second Approval. < S:\MDC-MD\SCPC\SCS > Page 56 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 57 of 59 Lost Receipt 1. Click in Receipt field and in drop down arrow, select Lost. 2. Click on Save Changes button. 3. System displays View Summary tab. 4. Expense is added to Included Expenses section with yellow icon displayed to the left of expense. 5. The system will perform the accounting validations and display a green icon and hover over message, stating "External Validation Successful". 6. Double click on expense to open. 7. Click on POLICY INFO tab to review Policy violation message for clarification. 8. POLICY INFO tab opens with message regarding next steps that system will take expense items submitted with yellow icons will be sent to Audit for second-level review and approval. 9. Click on POLICY INFO tab to close window. 10. Click Save Report to save in draft status. < S:\MDC-MD\SCPC\SCS > Page 57 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 58 of 59 11. Click Back to Home to return to SumTotal Home Page. 12. Click on Forms under Quick Links on SumTotal home page. 13. Click on Lost Form link. 14. Or it can be found here: Lost Receipt Form. 15. Fill out all fields on form. 16. Click on Print Form button to PDF the form. 17. This form must be signed by spender and approving Manager. 18. Scan with other receipts and upload signed version with all receipts. < S:\MDC-MD\SCPC\SCS > Page 58 of 59 10/02/2020 Northern States Power Company Job Aid Creating and Submitting Expense Reports Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5B Page 59 of 59 Electronic File http://xpressteams.xcelenergy.com/sc/reference_home/default.aspx Location: Changes to Procedure: Date of Change Reason for Change What Changed? Updated By: Resource Appendix: Post Additional Resource location Sample output Links to resource documents Distribution List < S:\MDC-MD\SCPC\SCS > Page 59 of 59 10/02/2020 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 1 of 25 Approving an Expense Report SUMTOTAL APPROVING AN EXPENSE REPORT This document outlines how an approver of the employee can approve or reject and expense report or an expense item in SumTotal. High Level Process Summary Step 1 - Log into SumTotal .................................................................................................................................... 2 Step 2 Review Home Page...................................................................................................................................3 Step 3 Open Expense Report ..............................................................................................................................6 Step 4 Open & Review Receipt Packet ...............................................................................................................8 Step 5 Review Meal Type Expense .....................................................................................................................8 Step 6 Review Purchase Type Expense...........................................................................................................13 Step 7 Review Hotel Type Expense ..................................................................................................................16 Step 8 Review Personal Car Mileage (Single round Trip)...............................................................................18 Step 9 Review Mileage Multi-Trip......................................................................................................................20 Step 10 Reject an Expense ................................................................................................................................22 Step 11 - Approving an Expense Report .............................................................................................................24 PAGE 1 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 2 of 25 Approving an Expense Report SUMTOTAL APPROVING AN EXPENSE REPORT Step 1 - Log into SumTotal · From XpressNet, click on Job Tools from the main menu · Select Travel and Expenses · Select Employee Expense · Select SumTotal (Expense Reporting System) Detailed Process System displays SumTotal home page · To Logout of the application, click on Logout link in the top right corner of the screen · System closes PAGE 2 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 3 of 25 Step 2 Review Home Page The approver can view the expense report(s) Approving an Expense Report Approvers will receive an e-mail notification when an expense report has been submitted for review and approval. This notification is also sent to the inbox on the SumTotal home page. If your email notifications are going toJunk Mail select the link for instructions. Back to top · Click the View Documents to Approve under Management Action list and it will navigate you to all Approval Items The top section, Approval Items, displays a list of expense reports that have been submitted for approval. The lower section under the Included Expenses tab displays a quick view of all expense(s) included in the above selected report. PAGE 3 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report The expense(s) with the "+" to the left, indicates the expense has been itemized to include expense line items (sub expenses) Click the "+" to display expense line items Approver must review all expenses to ensure compliance. The approver can approve or reject an expense item or the entire report. Note: A yellow icon to the left of expense report indicates expense(s) within the report that have been flagged as nonpolicy compliant. Select policy link to review: 10.2 Travel and Employee Expense Reimbursement Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 4 of 25 Approving an Expense Report Back to top PAGE 4 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 5 of 25 Approving an Expense Report Approvers are required to review all expenses within an expense report to ensure they are appropriate and compliant with the 10.2 Travel and Employee Expense Reimbursement. Once the approver determines if each expense is or is not an appropriate business expense, the approver can approve or reject accordingly. Back to top If an expense is inappropriate or is non-policy compliant the approver will review and decide to approve or reject. Rejected expense(s) will be sent back to the spender (employee) to adjust and/or mark as personal. Expense(s) marked personal will be offset by any cash out of pocket expense(s) in expense report. Any remaining amount will be reimbursed to employee or owed Xcel Energy. Employee must write a personal check/money order payable to Xcel Energy and submit with the Money Owed Xcel form and send to Corporate Card Department 9500 Interstate 76, Henderson, CO 80640. The system will display the policy tab indicating which policy details of the flagged expense are non-compliant. All expense reports with flagged expense(s) will be sent for back office audit review. Non-compliance is monitored and reported on a monthly basis. Personal use of the Corporate Card is limited to incidental expenses only. Managers will ensure employees follow the guidelines for Personal items on expense reports: · Incidental use is when the personal portion of an expense is less than 50 percent of the combined business and personal expense amount · If the personal expense is greater than 50 percent of the total expense amount, the Employee should claim the business expense as cash out of pocket on an expense report · Personal expenses (e.g., movies, toiletry articles, etc.) are not reimbursable · If an Employee accidentally uses a personal credit card for business travel or business-related expenses, the approving Leader can approve the expense along with the proper supporting original itemized receipt documentation · In instances where the corporate credit card is not accepted, the Employee should claim the business expense as cash out of pocket on the expense report and the approving Leader can approve the expense along with the proper original itemized receipt documentation Cash out of pocket expenses are monitored to ensure the Corporate Credit Card is used appropriately. Employees are required to reconcile credit card transactions within 30 days from the posting date and Managers must ensure employees are meeting this requirement. · All Credit card transactions are monitored monthly to ensure timely reconciliation · Reminder notification is sent to spender 15 days from transaction(s) posting date · If the transaction(s) remain unreconciled, delinquency notification will be sent to spender and spender's manager on day 46 and every day thereafter until transaction(s) have been reconciled and submitted for approval · Credit card accounts are suspended at 60 days · Credit card accounts are closed at 90 days · If credit card account is closed due to 90 day delinquency, employee will be required to obtain approval from Director of Supply Chain Process Control to apply for new credit card. PAGE 5 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 6 of 25 Approving an Expense Report Delinquency is tracked based on the "posting date" of the credit card transaction(s). We have 5 different notifications in SumTotal. They are set up as follows: 1. Notify Spender: Stale CC Transactions - This notification is sent to the spender 15 days after Credit Card transaction(s) posting date. This is a reminder that they have CC transactions that have not yet been added to expense report and that transactions must be added to expense report within 30 days of incurred transaction. 2. Notify Spender and Supervisor: Stale CC Transactions - This notification is sent to the spender and Level 1 approver 45 days after credit card transaction(s) posting date. This email states that spender has cc transactions over 30 days that have not been added to expense report. They must reconcile and submit expenses within 15 days from the date of first notifications (this notification will be sent daily until transactions are added to expense report. 3. Notify Spender: Document awaiting to be submitted - This notification is sent to the spender has expense report with credit card transactions that are 45 days from CC Transaction(s) posting date. They must submit expense report within 15 days from the date of the first notification (This notification will be sent daily until expense report is submitted for approval) 4. Notify Approver: Document approval is overdue - This notification is sent to Approver when they have expense report(s) awaiting their approval for over 15 days (This notification will be sent 15 days from date expense report was submitted for approval and again 15 day later, if not approved within 15 day from 2nd notification expense report will skip to level 2 approver) 5. Notify Approver: Approval level has been skipped - This notifies Level 1 approver that approval has been skipped and expense report has been sent to level 2 approver for approval. This notification is sent 30 days from date expense report was submitted to level 1 for approval Back to top Step 3 Open Expense Report Approver will select the appropriate expense report. · Click on and highlight the report · Click Open button PAGE 6 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report System displays the View Summary tab with details of the expense report document · Click on Report Header tab Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 7 of 25 Approving an Expense Report Review Report Name and dates. Ensure the compliance certification checkbox is marked next to compliance message. Note: Approver will reject expense report if compliance message box is not checked Reject An Expense Report Click on View Summary tab to return to the details of the expense report. PAGE 7 of 25 Back to top 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report From the View Summary tab a list of expense(s) included in report to be reviewed will be displayed. Step 4 Open & Review Receipt Packet The receipt images will be reviewed and compared to each expense item on report. To view the full receipt packet: · Click the View Receipts button (circled in the red) Or to review the receipt on an individual line item: · Click the Paper with Folded Corner on each line item (in the red rectangle) The system will display a scanned image of uploaded documentation At the top of each receipt the Expense Spend Date, Expense Type and Spent Amount will appear (this is generated systematically based on the the expense line item) There could be multiple images make sure to scroll to view all or click on each item to view all receipts Review and validate appropriate for expense item PAGE 8 of 25 Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 8 of 25 Approving an Expense Report 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report From the View Summary panel, under the Included Expenses section · Click on the expense line to open and review Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 9 of 25 Approving an Expense Report Back to top Step 5 Review Meal Type Expense Expense types are grouped by "M" (Meals), "P" (Purchase) and "T" (Travel) categories. · All meal type expenses require itemization at line item level to identify meal vs. alcohol portion · All meal type expenses require number and list of attendees Approver reviews the information entered by the Employee. Specific things approver should look at when reviewing Meal type expenses include: · Ensure Expense Type is accurate for expense · Ensure Business Purpose is adequately documented to clearly describe business reason for expense · Ensure Number of Persons is correct · Ensure expense line item(s) is allocated to the correct accounting string · Ensure List of Attendees is included · Ensure meals are itemized and meal vs. alcohol portion identified when applicable · Ensure tax information is entered as expected · Ensure expense does not exceed Daily Meal Allowance per person/per day Note: The system will flag all meal type expense(s) when total amount exceeds corporate policy. PAGE 9 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 10 of 25 The Expense View screen displays the expense details under the View Expense section · Review and ensure the above listed items are entered correctly (i.e. Expense Type, Business Purpose, Nbr of person etc.) Approving an Expense Report · Review and ensure Expense Type selected is accurate for expense · Review Business Purpose to ensure it provides and adequately documents the business reason for the expense · Review and ensure Number of persons is accurate · Spent Amt, if a receipt is required, verify that the report amount equals the itemized receipt amount · View Receipt, if a receipt is required, you need to verify that the receipt(s) matches all of the expense submitted Meals less that $25.00 do not require a receipt and the field must be changed to show Not Required. · Click on Allocation button to review accounting allocation(s) are correct Back to top PAGE 10 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report · Verify Expense Line item(s) are allocated to the correct accounting string · Click the Done button · Click on Attendee button Review attendee(s) name and information Note: All meal expense types require number and list of attendee(s) · Click Done button Review itemization by selecting the Itemize button OR Select the "+" to expand and review the itemization PAGE 11 of 25 Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 11 of 25 Approving an Expense Report Back to top Back to top 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Ensure meal(s) are itemized and alcohol portion is separated if applicable Compare to the total receipt to verify accuracy · Click on Tax Info tab to review sales tax Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 12 of 25 Approving an Expense Report The Tax Info tab displays the Sales Tax Paid and Amt of Sales Tax Paid fields. · Click on Tax Info tab to close Review and verification have been completed. The approver can: PAGE 12 of 25 Back to top 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report · Repeat steps to continue reviewing additional expense items OR · Approve An Expense Report OR · Reject An Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 13 of 25 Approving an Expense Report Step 6 Review Purchase Type Expense Expense Types are grouped by "M" (Meals), "P" (Purchase) and "T" (Travel) categories. The Expense View screen displays the expense details under the View Expenses section · Review and ensure the above listed items are entered correctly (i.e. Expense Type, Business Purpose, Nbr of person etc.) Approver reviews the information entered by the Employee. Specific things approvers should look at when reviewing Purchase Type expenses include: · Ensure Expense Type is accurate for expense · Ensure Business Purpose is adequately documented to clearly describe business reason for expense · Expense Line item(s) are allocated to the correct accounting string · Ensure List of Attendees is included, if applicable · Purchase expense types that require number and list of attendees/recipients include: o P-Recognition-Entertainment o P-Recognition-Safety o P-Recognition-Gifts o P-Entertainment-Tickets o P-Life Event-Gifts · Ensure tax information is entered as expected · Ensure correct Facility Code is selected Back to top PAGE 13 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report · Review and ensure Expense Type selected is accurate for expense · Review Business Purpose to ensure it provides and adequately documents the business reason for the expense · Click on Allocation button Review accounting allocation(s) are correct · Click the Done button From the View Expense panel · Click on Tax Info tab to review and ensure sales tax is entered or exempt reason code is selected Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 14 of 25 Approving an Expense Report Back to top PAGE 14 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 15 of 25 The Tax Info tab displays the Sales Tax Paid and Amt of Sales Tax Paid fields. · Review and ensure Sales Tax Paid is Yes and Amt of Sales Tax Paid is entered If Sales Tax Paid field is marked No and amount is zero, check to ensure correct exempt code was selected. If tax is owed, but was not charged; ensure the exempt code XXX-NOT EXEMPTUSE TAX OWED has been selected. This code informs the tax department to accrue and pay the tax to the appropriate taxing authorities. · Check and ensure appropriate Facility Code is selected · Click on Tax Info tab to close window Approving an Expense Report Back to top Facility Code defaults the facility from user's profile. Facility Code is used to identify where we took possession of item(s) purchased. Ensure appropriate facility code is entered for where material was shipped/used Review and verification have been completed. The approver can: · Repeat steps to continue reviewing additional expense items OR · Approve An Expense Report OR · Reject An Expense Report PAGE 15 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 16 of 25 Step 7 Review Hotel Type Expense Expense Types are grouped by "M" (Meals), "P" (Purchase) and "T" (Travel) categories. Approving an Expense Report Approver reviews the information entered by the Employee. Specific things approver should look at when reviewing Hotel type expenses include: · Ensure Expense Type is accurate for expense · Ensure Business purpose is adequately documented to clearly describe business reason for expense · Ensure expense line item(s) are allocated to the correct accounting string · Ensure Hotel expense is itemized to break out room rate, room tax for each night and any other expense included on hotel receipt. · Ensure tax information is entered as expected · Ensure expense meets Xcel's policy guidelines System will flag Hotel expense type when room rate greater than the corporate policy per night Back to top The Expense View screen displays the expense details under the View Expenses section · Review and ensure the above listed items are entered correctly (i.e. Expense Type, Business Purpose, etc.) · Review and ensure Expense Type selected is accurate for expense · Review Business Purpose to ensure it provides and adequately documents the business reason for the expense · Click on Allocation button PAGE 16 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report · Review to confirm accounting allocation(s) are correct · Click Done button Review itemization by selecting the Itemize button OR Select the "+" to expand and review the itemization Click on View Receipts to compare allocation to receipt Ensure hotel expense is itemized to break out room rate, room tax for each night and any other expense included on hotel receipt Compare the total receipt to verify accurate. PAGE 17 of 25 Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 17 of 25 Approving an Expense Report Back to top Back to top 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 18 of 25 Approving an Expense Report View Expense screen displays Once review and verification have been completed, the approver can: · Repeat steps to continue reviewing additional expense items OR · Approve An Expense Report OR · Reject An Expense Report Back to top Step 8 Review Personal Car Mileage (Single round Trip) Per Policy Xcel Energy only reimburses mileage for use of personal vehicle for company business. Xcel Energy does not reimburse gasoline as additional expense. The required documentation (Departure/Destination and number of miles) is entered in system for Personal Car Mileage · Review and ensure Expense Type TPersonal Car Mileage is selected for expense · Review Business Purpose to ensure it provides and adequately documents the business reason for the expense · Click on Allocation button There are 2 expense types for mileage reimbursements o T-Personal Car Mileage This expense type is selected when there is a single round trip (i.e. MDC to 1800 Larimer and back to MDC) o T-Multi-Trip Mileage This is used when traveling to multiple locations for business related activities. T-Multi-Trip Mileage requires a mileage log to be attached to the expense report. PAGE 18 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report · Review to confirm accounting allocation(s) are correct · Click Done Click on Mileage button · Review and ensure correct Point of Departure and Destination are entered · Review number of miles are entered accurately · Click Save and Return button to return to Expense View Personal Mileage (single trip) expense does not require receipts as all documentation is entered in the Mileage button Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 19 of 25 Approving an Expense Report Back to top PAGE 19 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report View Expense screen displays Once review and verification have been completed, the approver can: · Repeat steps to continue reviewing additional expense items OR · Approve An Expense Report OR · Reject An Expense Report Step 9 Review Mileage Multi-Trip · Review and ensure Expense Type T Multi Trip Mileage is selected and accurate for expense · Ensure Business Purpose provides and adequately documents the business reason for the expense · Click on Allocation · Review to confirm accounting allocation(s) are correct · Click Done Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 20 of 25 Approving an Expense Report Back to top PAGE 20 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Mileage button is not required for multi trip; instead the mileage log is used as the required documentation Employee must scan the mileage log and upload to the expense report Expense View screen displays Review and verification have been completed. The approver can: · Repeat steps to continue reviewing additional expense items OR · Approve An Expense Report OR · Reject An Expense Report Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 21 of 25 Approving an Expense Report Back to top PAGE 21 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Step 10 Reject an Expense Approvers have the ability to reject a single expense or all expenses on an expense report. If expense is non-compliant the approver must either: · Approve the expense report/item knowing that it is non-compliant OR · Select the item(s) to reject and click Reject Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 22 of 25 Approving an Expense Report The Rejection Information box displays · Click on drop down arrow and select correct Reason for rejection code · Enter information in Comment section Make sure to include enough information to allow the spender to make corrections and resubmit the expense. · Click Done button PAGE 22 of 25 Back to top 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report System will display red "X" next to the rejected expense The rejected expense is sent back to spender with instructions detailing how to correct the item/report. Spender will adjust the expense per approver's comments and resubmit for approval. You can review and edit your comments · Click Edit Comment button · Click Done button From the Expense View panel · Click Done button The View Summary tab displays a list of expense(s) included in report you are reviewing. Red "X" displays next to the reject expense. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 23 of 25 Approving an Expense Report Back to top PAGE 23 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report Step 11 - Approving an Expense Report After the review and validation process is completed: · Click the X on the receipt viewer to close · Click Continue button · Click Submit to save the report in Approval Complete status The expense report will be retained in the Corporate Expense system in accordance with the Record Retention policy. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 24 of 25 Approving an Expense Report PAGE 24 of 25 05/20/2019 Northern States Power Company Job Aid: Approving an Expense Report The system will navigate to the Document to Approve tab on the Approve Documents panel Click the Approval History tab Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 5C Page 25 of 25 Approving an Expense Report Back to top Approval History displays all reports and status of approver action (approval complete, rejected or partially approved, Submitted for MA, Submitted for Audit) The expense report will be retained in the Corporate Expense System in accordance with the Record Retention policy Sort by Status to review. Status options include: Approved, Rejected or Partially Approved. \ PAGE 25 of 25 05/20/2019 Northern States Power Company Employee Expense Budget and Actual Table I Employee Expense State of Minnesota Electric Jurisdiction ($ 000's) Travel Expense Lodging Expense Meals Expense Misc. Travel Expense (1) Travel Expense Subtotal 2017 Actual 3,579 2,058 1,742 4,033 11,412 2018 Actual 4,062 2,402 2,088 4,166 12,719 2019 Actual 4,295 2,317 2,116 4,854 13,582 2020 Forecast 2,837 1,185 1,190 2,570 7,783 2021 Budget 4,280 2,126 1,601 5,070 13,077 2021 TY Adj (224) (161) (828) (232) (1,444) 2021 Test Year 4,056 1,965 773 4,838 11,633 2022 Budget 4,092 2,095 1,583 4,677 12,447 Dues & Memberships Gifts & Recognition Board of Directors 551 431 302 776 761 (20) 741 752 934 1,058 1,475 1,021 1,008 (41) 967 1,028 1,025 1,048 1,136 1,318 1,322 (64) 1,258 1,354 Total 13,922 15,256 16,495 10,897 16,168 (1,569) 14,598 15,581 1. Changes are driven largely by employee relocation expenses and per diem expenses. This category also includes conference expenses. Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 6 Page 1 of 2 2022 PY Adj (216) (155) (798) (223) (1,392) (19) (40) (61) (1,512) 2022 Plan Year 3,876 1,940 785 4,454 11,055 732 989 1,292 14,069 2023 Budget 4,059 2,105 1,594 5,167 12,924 753 1,067 1,354 16,098 2023 PY Adj (223) (160) (824) (231) (1,438) (20) (41) (63) (1,562) 2023 Plan Year 3,835 1,945 770 4,936 11,486 733 1,027 1,290 14,535 Northern States Power Company Table II Employee Expense Actual vs. Budget Comparisons State of Minnesota Electric Jurisdiction Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 6 Page 2 of 2 ($ 000's) 2017 Actual Travel Expense Lodging Expense Meals Expense Misc. Travel Expense (1) Travel Expense Subtotal 3,579 2,058 1,742 4,033 11,412 2017 Adjusted Budget 4,203 1,761 727 4,592 11,283 2017 Adjusted Variance -624 297 1,015 -560 129 2018 Actual 4,062 2,402 2,088 4,166 12,719 2018 Adjusted Budget 3,348 1,860 790 4,026 10,024 2018 Adjusted Variance 714 542 1,298 140 2,695 2019 Actual 4,295 2,317 2,116 4,854 13,582 2019 Budget 4,207 1,819 1,206 5,376 12,608 2019 Variance 88 498 910 -522 974 2020 Forecast 2020 Budget 2,837 1,185 1,190 2,570 7,783 4,329 1,835 1,319 4,522 12,005 2020 Variance -1,492 -650 -128 -1,952 -4,222 Dues & Memberships 551 662 Gifts & Recognition 934 679 Board of Directors 1,025 902 -111 431 605 255 1,058 1,248 122 1,048 1,008 -174 302 897 -190 1,475 1,136 40 1,136 972 -595 776 951 -174 339 1,021 1,124 -104 165 1,318 1,298 20 Total 13,922 13,527 395 15,256 12,884 2,372 16,495 15,613 882 10,897 15,378 -4,481 1. Changes are driven largely by employee relocation expenses and per diem expenses. This category also includes conference expenses. 2. Adjusted budget means the employee expense amount minus the employee expense adjustment as was proposed by Xcel Energy in our previous rate case Docket No. E002/GR-15-826. Northern States Power Company List of EER Schedules EER - Schedule 1 EER - Schedule 1A EER - Schedule 2 EER - Schedule 3 EER - Schedule 4 EER - Schedule 5 EER - Schedule 5A EER - Schedule 5B EER Schedule 5C EER - Schedule 5D EER - Schedule 5E EER - Schedule 5F EER - Schedule 5G EER - Schedule 5H EER - Schedule 5I EER - Schedule 5J EER - Schedule 6 EER - Schedule 7 EER - Schedule 8 EER - Schedule 9 EER - Schedule 10 EER - Schedule 11 EER - Schedule 12 Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 7 Page 1 of 2 Travel Expenses VP and Above Meal Expenses Entertainment Expenses Board of Directors Compensation and Expenses Top Ten Compensation Top Ten Expenses - Benjamin G. Fowke III Top Ten Expenses - Robert Frenzel Top Ten Expenses - Kent T. Larson Top Ten Expenses - Scott M. Wilensky Top Ten Expenses - Brett C. Carter Sr. Top Ten Expenses - Timothy J. O'Connor Top Ten Expenses - David L. Eves Top Ten Expenses - Darla Figoli Top Ten Expenses - Christopher B. Clark Top Ten Expenses - Judy M. Poferl Dues Gifts Aviation Lobbying SAP-VIM Transactions SAP-VIM Nuclear Transactions TIME Transactions Northern States Power Company List of EER Schedules EER - Summary Report 1 EER - Summary Report 2 EER - Summary Report 3 2021 Test Year 2022 Plan Year 2023 Plan Year Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 7 Page 2 of 2 Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 1 of 29 Employee Expense Reporting Report Preparation, Rate Case Adjustment Summary, and Analysis Overview This schedule describes the detailed steps taken to develop the EER Schedules, and the efforts taken by the Company to analyze and review transactions processed within SumTotal, Vendor Invoice Management (VIM) and TIME in order to provide a summary of employee expenses found in those technical systems. The Company's proposed test year adjustment for employee expenses is also summarized in this schedule. Creation of EER Schedules The Company took the following steps to create the EER Schedules provided in Volume 3, Required Information, Section IV Other Required Information, Tab 2. 1. The Supply Chain organization provided employee expense information for 2019 corporate credit card transactions, as well as reimbursements for other expenses, such as mileage, that were processed within the Company's primary expense reporting system, SumTotal. The data included transactions that were incurred by employees of the 1) Xcel Energy Service Company (XES), and 2) the Northern States Power Minnesota Operating Company (NSPM). The raw data file contained the transaction lines assigned to employee-related expense accounts that were required in the analysis. While SumTotal has many fields, only those fields that would (1) determine whether the transaction was allocable to Minnesota electric ratepayers, and (2) determine whether the transaction was within the scope of the Employee Expense Statute were included. 2. Transactions were sorted based on the Company's accounting general ledger "Systems, Applications and Products in Data Processing" (SAP) software's "Internal Order" account field to limit the size of the raw data set to be analyzed to approximately 223,000 transactions by including only those costs that were either direct assigned, or that were allocated in part as operating expense to the NSPM Operating Company. Specifically, transactions assigned to Company Code "10" (NSPM) and Company Code "50" (XES) were retained due to the likelihood the entire transaction cost, or a portion of the cost, could be allocated to NSPM. All other transactions, directly assigned to other Xcel Energy legal entities, were eliminated as being outside of the scope of analysis related to rate cases and reporting required for jurisdictions residing within NSPM. 3. Several columns were added to facilitate analysis of the data and creation of the EER Reports. Examples of these analysis fields include: "EER Summary Cost Element" (Employee Expense Report), "EER Report #", "File Line Ref. #", "Required EER Report Transaction", "Year", "International Travel", "Above / Below the Line", "Board of Directors", "VP & Above", "Employee's Company", "Compensation Level", "Ten Highest Paid Employees", "Executive + Assistant's Transactions", "Executive / Assistant", "Key Word Search", "Keyword", "Vague Business Purpose Desc.", "Meals > $65 per Attendee", "Life Events", "Business Meals - Employee Only", "Flagged Transaction", and "Rate Case Adj. Transaction". 4. Data fields (columns) were also added to the file to manually calculate the amount of each transaction's total that was allocated to the NSPM Company, NSPM Company Electric Utility and to the State of Minnesota Electric Retail jurisdiction. The allocations were derived by matching the accounting used for the SumTotal transaction against tables of the Company's SAP general ledger accounting system data and then assigning the Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 2 of 29 associated allocation factors using Microsoft Excel VLookup functions. The analysis was then restricted to approximately 200,000 transactions which ultimately allocated abovethe-line expense to the State of Minnesota Electric Retail jurisdiction, or as a below-theline expense to the NSPM Company. 5. Of this data set, the Company's employees who were Vice Presidents and above and their executive assistants during 2019 were identified. 6. Employee expense transactions for our employees with a title of Vice President, or higher were identified. For each transaction of a Vice President or higher employee title, the field "VP & Above" was populated as "Yes". This field was coded as "No" for other employees' transactions. The "Executive / Assistant" field was then populated as "Executive" for executive (having a title of Vice President, or higher) employees' transactions. 7. The executives' Executive Assistants' transactions were identified and coded with their respective executive's name within the "Executive + Assistant's Transactions" field. The "Executive / Assistant" field was then populated as "Executive Assistant" for the Executive Assistants' transactions. The other employees' transactions were populated as "No". 8. Transactions of the ten highest compensated employees were identified. These transactions were coded with the employee's full name within the "EER Report #'s (5A 5J) Ten Highest Paid Employees" field. This field was left blank for other employees' transactions. 9. Transactions of the top (ten) highest compensated employees were identified as "Ten Highest Paid Employees" within the "Compensation Level" field. Other employees' transactions were labeled as "Not in 10 Highest Paid Group" within this field. 10. Xcel Energy Board of Director-related transactions were identified through the SAP "Internal Order" account field. Transactions coded to "850001936606 - CEO Board of Directors" and a few other internal order accounts were identified to be Board of Director related. In addition, a few other Board of Director-related transactions were coded to the SAP cost element account "5600656 - Fees Directors". These transactions were coded as "4 - Board of Directors Compensation and Expenses" within the "EER Report #4 Board of Directors" field. Other transactions were coded as "No" within this field. 11. Aviation and Travel Services transactions were identified through the SAP "Internal Order" account field. Transactions coded to "850001904397-35000127-Cessna Sovereign MN", "850001904398-35000128-Cessna Sovereign 680-0266 CO" and "85000000700130144783-Ops 110-110- Executive (Corp)" were identified to be related to corporate aviation. These transactions were coded as "EER Schedule 8 - Aviation" within the "EER Report # 8 Aviation" field. Other transactions were coded as "No" within this field. 12. Company employees who lobby on behalf of NSPM and Xcel Energy were identified. Their transactions were coded "9 - Lobbyist Employees" within the "Employees Who Lobby From Time to Time" field. 13. Employee expense transactions incurred by employees who lobby from time to time on behalf of NSPM or Xcel Energy were identified and coded as "Lobby from time-to-time" within the "Employees Who Lobby From Time to Time" field. This field was coded as "No" for other employees' transactions. 14. The "Posting GL Acct Desc" field was reviewed for the SAP "Cost Element" account codes identified in Table 1 to this Schedule "EER Cost Element Accounts (SAP)". Whenever a transaction was found with a matching code, the "EER Summary Account" Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 3 of 29 field was populated with a "Yes". Transactions coded to all other accounts required for the EER reporting were identified as "No" within this field. 15. For all transactions identified (in Step 14 above), we populated the "Required EER Report Transaction" field as "Yes". In addition, all other transactions required for the Top Ten Compensated Employees, Board of Directors, Corporate Aviation and Lobbyist Employees were coded as "Yes" in the "Required EER Report Transaction" field. Other transactions not required to be included on the employee expense reports were coded as a "No." The "Required EER Report Transaction" field would be used at the end of the process to help develop the EER Reports. This field was used to sort-out only those transactions that would ultimately be included on the various EER Schedules. 16. Transactions coded to "Below-the-Line" FERC accounts based on the SAP "Cost Element" accounts (5600286 Non-Recoverable Recognition, 5600606 Dues Lobbying, 5600626 Contributions - Charitable, 5600631 Contributions - Community Sponsorships, 5600641 Contributions - Economic Development, 5600636 Contributions - Civic and Political, 5600616 Dues - Chamber of Commerce, 5600621 Dues - Social Service, 5600696 Deductions - Corporate Tickets, and 5600701 Deductions Other) were identified. These transactions were coded as "Below" within the "Above / Below the Line" field. For all other transactions, their respective FERC account assignment determined whether they were coded as "Above" or "Below" within this field. 17. Lobbyists' transactions coded to "Below-the-Line" FERC accounts based on the SAP "Internal Order" accounts 200000038008-30150979-OpCoNSPM-CS-Cser-811002-9951, 200002061708-Mapping-628005-995101, 200002061710-Mapping-628105-995101 and a few other internal order accounts were identified. These transactions were coded as "Below" within the "Above / Below the Line" field. 18. Based on the SAP "Cost Element" accounts included on the Company's EER reports, the combined total number of SumTotal system above the line transactions reviewed was 196,212. 19. Life Event-related transactions that were posted to the SAP "Cost Element" account "5600276 - Life Events" were identified and coded with the word "Yes" in the "Rate Case Adj. Transaction" field for inclusion in the 2021 test year employee expense adjustment. 20. A list of "key words" that would be used to search the data set for transactions which may not be appropriate for rate recovery was developed. The key word list was formed from our experience in past electric rate cases and was designed to identify expenditures related to sporting and entertainment events, life events, recreation, celebrations, recognition, international travel and lobbying. The key word list contains 124 words and is provided as Table 2 to this Schedule. 21. The key word search was performed on transactions coded both as having the "EER Summary Cost Element" field populated with a "Yes" and the "Above-The-Line" field populated as "Above" on the following SumTotal transactional fields: "Expense Type Name", "Sub Expense Type", "Business Purpose", "Line Description", "Report Name and "Merchant". a. Alcohol-related transactions were labeled "Alcohol" within the "Key Word" analytic field. In addition, key word searches were performed to identify any other alcohol-related transaction that was incorrectly coded, or that was not itemized and reported within the "Sub Expense Type" field as being alcohol-related. Alcoholic beverage-related transactions were coded with the word "Yes" in the "Rate Case Adj. Transaction" field for inclusion in the 2021 test year employee expense adjustment. Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 4 of 29 b. International travel related transactions were identified and labeled as "Yes" within the "International Travel" field and labeled "International" within the "Key Word" field, with the exception of international travel alcohol-related expenses which were labeled "Alcohol." Transactions coded under the "Expense Type" as "Airfare International" were labeled "International" within the "Key Word" field. Other transactions of those employees who assigned airline costs to "Airfare International" were reviewed to identify the related lodging, meals and other costs associated with their international travel. These transactions were also labeled as "International" within the "Key Word" field. Finally, other transactions of those employees having traveled abroad were searched based on the "Expense Incurred Date", "Business Purpose", "Line Description", "Report Name" and "Merchant" to identify any remaining transactions associated with their international travel. These transactions were labeled as "International" within the "Key Word" field. c. Transactions that were not posted to the SAP "Cost Element" account "5600276 Life Events" but that were later identified by key words associated with life events such as "Funeral", "Bereavement", "Flowers", "Floral", "Wedding", "Birthday", "Baby", etc. were coded with the word "Yes" in the "Rate Case Adj. Transaction" field for inclusion in the 2021 test year employee expense adjustment. d. Gift-related transactions processed to merchant OC Tanner using the corporate recognition program Xcelebrate were identified and coded with the word "Yes" in the "Corporate Recognition" field and were not included in the 2021 test year employee expense adjustment. Corporate-related recognition gifts presented under the Xcelebrate program were coded as "Recognition (Gift)" within the "Key Word" field. e. Gift related transactions that were not previously identified by the key word search process and that were coded under the "Expense Type" of "Recognition - Safety" were identified and labeled as "Recognition (Safety)" within the "Key Word" field. f. Gift related transactions that were not previously identified by the key word search process were identified and labeled as "Gift" within the "Key Word" field if not coded under the "Expense Type" of either "Life Event Gifts", or "Recognition Safety". g. Other gift-related transactions were identified and labeled as "Gift" within the "Key Word" field if they were not previously identified by the various key words (other than "Gift") but were coded under the "Sub-Expense Type" of "Career Event-Gift", "Engagement-Gift", "Recognition-Gift". h. Recognition related transactions were identified and labeled as "Recognition (Meals)" within the "Key Word" field if not identified by the various key words (other than "Recognition") but coded under the "Sub-Expense Types" of "Recognition - Meals", "Career Event-Meal", or "Engagement-Meal". i. Recognition-related transactions were identified and labeled as either "Recognition (Gift)", or "Recognition (Meals)", within the "Key Word" field if not identified by the various key words (other than "Recognition") but were coded under the "SubExpense Type" of "Engagement-Event". j. Recognition related transactions were identified and labeled as "Recognition (Safety)" within the "Key Word" field if not identified by the various key words (other than "Recognition") but that were coded under the "Expense Type" of "Recognition - Safety." Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 5 of 29 k. Recognition related transactions were identified and labeled as "Recognition (Gifts)" within the "Key Word" field if not identified by the various key words (other than "Recognition") but were coded under the "Sub-Expense Type" of "Recognition - Gifts." l. The Business Purpose field of transactions that were identified by searching for the recognition-related key words "Appreciation", "Award", "Event", "Thank You", "Gift" and "Recognition" was inspected to determine whether the transaction pertained to safety. The safety-related transactions were assigned "Recognition (Safety)" within the "Keyword" field. m. Key word searches often included any conceived common abbreviations of words, such as "Tckt" or "Tix" for "Ticket", "Avs" for "Avalanche", "T-Wolves" or "Wolves" for "Timberwolves", etc. The 2021 test year adjustment does not include costs related to retirement "workshops / seminars", "Retiree Broker Finalists," nor "Reach Retirement," etc. that were identified by searching for the key word "Retirement." The 2021 test year adjustment does include the celebration/appreciation/meals/gift-related and specific travel-related expenses associated with "Retirement" events. 22. Transactions initially identified through the key word search process, or other cursory review, were subsequently reviewed, line by line, to confirm if the transaction should be included in the rate case adjustment. Examples of transactions identified as part of the key word search but appropriate for rate recovery could include those incurred with vendors such as Holiday Inn Express, or Holiday Station Store when searching for the word "Holiday", etc. Transactions identified through the key word search process, or other cursory review, but that are not a part of the rate case adjustment are coded as "FALSE / OK" within the "Rate Case Adj. Transaction" field. 23. Transactions for Meals > $65 per Attendee were identified. Meal transactions having costs exceeding $65 per attendee were identified as "Yes" within the "Meals > $65 per Attendee" field. These transactions were identified based on review of the SumTotal systems' "Cost Per Attendee" data field. The entire amount of the excluded transactions' total cost that was allocated to the State of Minnesota electric retail jurisdiction was included in the 2021 test year adjustment by coding the "Rate Case Adj. Transaction" analytic field with the word "Yes". 24. Transactions that are not a reasonable cost of service, based on our prior experience, including large transaction amounts for airfare or lodging, etc. were identified. This was a line-by-line, field-by-field review. Transactions that would have more appropriately been recorded "below the line" were identified by populating the "Flagged Transaction" analytic field with the word "Yes". These transaction costs were coded with the word "Yes" in the "Rate Case Adj. Transaction" field for inclusion in the 2021 test year adjustment. 25. Transactions that could have a "vague" business purpose were reviewed. A line-by-line review of the "Business Purpose" field of all remaining above the line EER-related transactions that had not previously been assigned the word "Yes" within the "Rate Case Adj. Transaction" field for inclusion in the rate case 2021 test year adjustment was completed. If the "Business Purpose" field, in isolation, could not convey enough detail about the purpose of the transaction, the word "Yes" was placed within the "Vague Business Purpose Desc." field. Examples include single-word entries such as "Dinner," "Airfare," "Travel," and "Meeting." A line-by-line review of those transactions flagged "Yes" was performed using a combination of the Business Purpose and Line Description Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 6 of 29 fields to determine if the business purpose remained vague. Since many of the initially flagged transactions contained only acronyms, the acronyms were reviewed in conjunction with other transaction data fields. A list of 229 acronyms that are commonly used by our employees was developed. It is not intended to be a complete list of every acronym found in the Business Purpose field. It demonstrates that hundreds of industry acronyms are used by our employees and are not necessarily vague descriptions of their activities and costs. The acronym list is provided as Table 3 to this Schedule. 26. If the combined documentation properly supported the transaction, the transaction cost was coded as "FALSE / OK" within the "Rate Case Adj. Transaction" analytic field. The respective cost for each of the remaining transactions identified as having a "vague" business purpose were coded with the word "Yes" in the "Rate Case Adj. Transaction" analytic field for inclusion in the 2021 test year adjustment. 27. Transactions that were not otherwise identified by the various key words and line-by-line review that pertained to business meals involving only employees were identified. All remaining XES and NSPM employees' transactions processed with the Expense Type of "Business Meals - Employee Only" were subsequently coded with the word "Yes" in the "Rate Case Adj. Transaction" field for inclusion in the 2021 test year employee expense adjustment. 28. The 2021 test year employee expense adjustment for SumTotal transactions was calculated by selecting all the transactions with "Yes" in the "Rate Case Adj. Transaction" field and summing the amounts that were allocated to the State of Minnesota electric retail jurisdiction to quantify the appropriate aggregate adjustment. 29. The "EER Summary Report 1" which reflects the State of Minnesota electric retail jurisdiction adjusted 2021 budget test year amount was developed. The summary report provides the employee expense-related costs in the following categories that are identified in accordance to the related detail EER Schedule number that has also been provided to report the Company's 2019 actual expenditures: Schedule1 - Travel and Lodging Expenses Schedule 2 - Food and Beverage Expenses Schedule 3 - Recreational and Entertainment Expenses Schedule 4 - Board of Director Expenses Schedule 6 - Dues and Memberships Expenses Schedule 7 - Gift Expenses Schedule 8 - Owned, Leased, or Chartered Aircraft Expenses Schedule 9 - Lobbying Expenses Note: Schedule 5 is a sub-report that provided all transactions of the Company's ten highest compensated employees and is therefore not included in the list above. The detailed EER Schedules of 2019 actual expenses were developed: 1. Travel and Lodging Expenses 1A. VP and Above Travel and Meal Expenses 2. Food and Beverage Expenses 3. Recreational and Entertainment Expenses 4. Board of Director Expenses 5. EER Schedule 5 provides the transactions of each of the Ten Highest Compensated Employees Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 7 of 29 6. Dues and Memberships Expenses 7. Gift Expenses 8. Owned, Leased or Chartered Aircraft Expenses 9. Lobbying Expenses 10. SAP Vendor Invoice Management (VIM) Applications Expenses 11. SAP Vendor Invoice Management (VIM) - Nuclear Application Expenses 12. TIME Application Expenses Each Schedule was given a Line Reference Number. Schedules 1 through 7 include the following SumTotal system data fields: 1. Application 2. Company 3. Expense Incurred Date 4. Expense Category 5. Expense Type 6. Sub Expense Type 7. Business Purpose 8. Line Description 9. Merchant 10. Approved Amount 11. NSPM Company Total Amount 12. NSPM Electric Utility Total Amount 13. State of Minnesota Electric Retail Amount The following additional data fields are provided on EER Schedules 1A, 2, 3, 5A-5J and 7: 1. Attendees Count 2. Cost Per Attendee Analysis of Other Company Systems There may be employee expenses in Company systems other than SumTotal so an analysis was performed on the transactions processed in the SAP Vendor Information Management (VIM), SAP Vendor Information Management (VIM) Nuclear and TIME payroll systems. SAP-VIM: 1. In 2019, there were 5,988 transactions processed by the Xcel Energy Service Company (XES) and the NSPM Operating Company (NSPM) to the cost element accounts included in the employee-related expense analysis. Of these, the vast majority, 84%, pertain to 5,041 reimbursement request transactions entered by NSPM Company Time Keeper employees to re-fund their respective corporate petty cash accounts for non-labor expense entries incurred by the NSPM union work force across all business areas which are reported within the TIME system. Examples of these entries are per diems, meal allowances, mileage, site allowance, and safety shoes, uniforms, and other similar charges. These expenses are processed within the TIME system so that they are properly reported to the Internal Revenue Service and included in these employees' annual W2 wage statements. 2. Data was queried for XES and NSPM transactions coded to the accounts included on the Company's EER reports, as provided in Table 1 "EER Cost Element Accounts (SAP)". This was done to focus only on transactions that were either direct assigned, or that were Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 8 of 29 allocated in part to the NSPM Operating Company. Transactions that did not directly assign or allocate any costs to the NSPM legal entity were excluded from the data set. The results of the query were exported to a Microsoft Excel worksheet for further analysis and to enable sharing the information with others. 3. Data fields in the Microsoft Excel file include: "Company Code", "Vendor", "Document Date", "Item Text", "Document Type", "G/L Account Desc", "Internal Order Key", "IO TYPE" and "Amount". 4. Data fields (appended in the spreadsheet's columns following the raw data) were added to track, analyze, and summarize the detailed transactions: "EER Report #", "Line Ref. #", "Year", "Vendor Category", "Above / Below the Line", "Transaction Sort" and "Rate Case Adj. Transaction". 5. Data fields (columns) were added to the file to manually calculate the amount of each transaction's total that was allocated to the NSPM Company, NSPM Company Electric Utility and to the State of Minnesota electric retail jurisdiction. The allocations were derived by matching the accounting used for the transaction against tables of the Company's SAP general ledger accounting system data and then assigning the associated allocation factors using Microsoft Excel VLookup functions. The analysis was then restricted to 5,873 transactions which ultimately allocated to above-the-line expense to the State of Minnesota Electric Retail jurisdiction, or as a below-the-line expense to the NSPM Company. 6. Transactions coded to "Below-the-Line" FERC accounts based on the cost element accounts 5600286 Non-Recoverable Recognition, 5600606 Dues Lobbying, 5600626 Contributions - Charitable, 5600631 Contributions - Community Sponsorships, 5600641 Contributions - Economic Development, 5600636 Contributions - Civic and Political, 5600616 Dues - Chamber of Commerce, 5600621 Dues - Social Service, 5600696 Deductions - Corporate Tickets, and 5600701 Deductions Other were identified. These transactions were coded as "Below" within the "Above / Below the Line" field. For all other transactions, their respective FERC account assignment based on the SAP internal order used determined whether they were coded as "Above" or "Below" within this field. 7. The "Vendor Category" field was used to identify whether the transactions pertained to a vendor, Board, or Time Keeper/Employee reimbursement "Request For Payment" (RFP) processed in SAP VIM, and then distributed to various time-keeper employees to re-fund their respective corporate petty cash accounts. These transactions are excluded from the EER Schedule 10 - SAP Vendor Invoice Management (VIM) Application Expenses, since these payments are captured through the TIME system (as taxable payments on these employees' W2 tax forms). These transactions were coded as "In TIME System per Time Keeper (=Petty Cash Reimb.)" within the "Vendor Category" field. 8. Xcel Energy Board of Director-related transactions were identified through the SAP "Internal Order" account field. These transactions were coded as "Board of Directors" within the "Vendor Category" analytic field. 9. Vendor-related transactions were coded as "Outside Vendor" within the "Vendor Category" analytic field. 10. Based on the cost element accounts included in the analysis, there were 802 transactions that allocated costs to the State of Minnesota electric retail jurisdiction during 2019. There were 199 employee expense-related transactions processed within the SAP VIM system by employees of the Xcel Energy Service Company (XES) and the Northern States Power Minnesota Operating Company (NSPM). There were 196 transactions related to Xcel Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 9 of 29 Energy Board of Directors payments and reimbursements, and 407 transactions related to outside vendors. 11. Transactions that would have more appropriately been recorded "below-the-line" were identified. For transactions identified as such, we populated the "Flagged Transaction" analytic field with the word "Yes". These transaction costs were coded with the word "Yes" in the "Rate Case Adj. Transaction" analytic field for inclusion in the rate case' 2021 test year employee expense adjustment. 12. The 2021 test year employee expense adjustment for the SAP VIM system's transactions was calculated by selecting all the transactions with "Yes" in the "Rate Case Adj. Transaction" field and summing the amounts that were allocated to the State of Minnesota electric retail jurisdiction to quantify the appropriate aggregate adjustment. SAP-VIM-Nuclear: 1. A data file of 2019 transactions from the SAP-VIM-Nuclear system was created. The file contained transactions with SAP cost element accounts corresponding to the "Posting General Ledger Account Description" field in Table 1 to this Schedule. All the resulting transactions were directly assigned to the Northern States Power Minnesota Operating Company (NSPM). 2. Data fields in the SAP-VIM-Nuclear Microsoft Excel file include: "Fiscal Year", "Period", "Document Date", "Document Type", "Company Code", "Vendor - Key", "Document Number", "Ref. document number", "Transaction Description", "Internal Order", "Cost Element", "Cost Center Org Lvl 1 Desc" and "Amount". 3. Analytic data fields (appended in the spreadsheet's columns following the raw data) were added to track, analyze, and summarize the detailed transactions: "Application", "EER Summary Object Account", "EER Report #", "Line Ref. #", "FERC Account", "Above / Below the Line", and "Rate Case Adj. Transaction". 4. Data fields (columns) were added to the file to manually calculate the amount of each transaction's total that was allocated to the NSPM Company, NSPM Company Electric Utility and to the State of Minnesota electric retail jurisdiction. The allocations were derived by matching the accounting used for the transaction against tables of the Company's SAP general ledger accounting system data and then assigning the associated allocation factors using Microsoft Excel VLookup functions. Based on the cost element accounts included in the analysis, the total number of SAP-VIM-Nuclear system 2019 transaction lines reviewed was 95. Each of these employee expense-related transactions included in the analysis allocated some expense to the State of Minnesota electric retail jurisdiction. 5. Transactions were reviewed line by line to find any employee expenses that may be "below the line" type transactions. In such cases, the transaction would have then been identified by populating the "Rate Case Adj. Transaction" field with the word "Yes. 6. No costs from the SAP-VIM-Nuclear application, allocated to the State of Minnesota electric retail jurisdiction, were included as an adjustment to the 2021 test year. TIME: 1. The TIME payroll system's data was queried for the Xcel Energy Service Company (XES) and the NSPM Company employees' non-labor transactions coded to the cost element accounts included on the Company's EER reports, as provided in Table 1 "EER Cost Element Accounts (SAP)". This provided transactions that were direct assigned to the Northern States Power Company Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 10 of 29 NSPM Operating Company. The results of the queries were exported to Microsoft Excel files and combined for further analysis and to enable sharing the information with others. 2. The total number of TIME system 2019 transaction lines reviewed was 118,107. Of these transactions, 96,528 assigned cost to the State of Minnesota electric retail jurisdiction. 3. Data fields in the TIME file include: "CO" (Company), "WORK.DT", "ERNCD DESCR" (Earnings Code Desc), "SAP GL ACCT" (SAP General Ledger Account), "Internal Order", "LVL2 DESCR" (Business area), "LVL3 DESCR" (Sub-Business area), "DEPT DESCR", "UNION" (employee's category - assigned as `Yes', or `No'), "Year", "Period" and "Total Amount". 4. Analytic data fields (appended in the spreadsheet's columns following the raw data) were added to track, analyze, and summarize the detailed transactions: "EER Summary Cost Element", "EER Report #", "Line Ref. #", "Utility", "Above / Below the Line", and "NSPM MN Electric 2019 Test Year Adj. Transaction". 5. Data fields (columns) were added to the file to manually calculate the amount of each transaction's total that was allocated to the State of Minnesota electric retail jurisdiction. The allocations were derived by matching the accounting used for the TIME system transaction against tables of the Company's SAP general ledger accounting system data and then assigning the associated allocation factors using Microsoft Excel VLookup functions. 6. The transactions having activity in 2019 against the accounts included on the Company's EER reports were coded to "Above-the-Line" accounts. 7. The non-labor transaction lines identified within the TIME application were associated with NSPM union employees' tax reportable reimbursements. 8. The TIME application "Earnings Codes" are summarized in Table 4 "TIME Earnings Codes" located at the end of this document. 9. Transactions were reviewed to find any employee expenses that may be "below the line" type transactions. No transactions that would have more appropriately been recorded "below the line" were identified. 10. No costs from the TIME application, allocated to the State of Minnesota electric retail jurisdiction, were included as an adjustment to the 2021 test year. Northern States Power Company Test Year Adjustment Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 11 of 29 The analysis described above resulted in the following employee expense-related adjustment, reducing the 2021 Budget Test Year cost of service request included in the 2020 State of Minnesota Electric Utility rate case filing: Based on Service Company & NSPM Company employees' 2019 transactions Total Amount NSPM Total Amount NSPM Electric Utility Above the Line Amount State of MN Electric Retail Adjustment Amount SumTotal SAP-VIM SAP-VIM - Nuclear TIME (Non-Labor) Key Word Search Business Meals - Employee Only Flagged Transactions Vague Business Purpose Life Events Meals > $65 per Attendee Subtotal $ 1,299,476.14 $ 1,060,217.19 $ 723,792.93 $ 149,224.31 $ 30,153.53 $ 47,792.70 $ 3,310,656.80 Flagged Transactions $ 47,865.15 Flagged Transactions $ - Flagged Transactions $ - $ 3,358,521.95 $ 750,459.82 $ 708,605.10 $ 354,209.89 $ 92,169.62 $ 19,179.82 $ 28,109.69 $ 1,952,733.94 $ 35,890.03 $ - $ - $ 1,988,623.96 $ 710,512.01 $ 687,193.46 $ 330,177.79 $ 88,242.30 $ 18,382.09 $ 27,067.78 $ 1,861,575.43 $ 32,954.18 $ - $ - $ 1,894,529.61 $ 584,574.43 $ 567,338.01 $ 278,366.00 $ 72,960.82 $ 15,117.03 $ 22,165.63 $ 1,540,521.91 $ 28,727.79 $ - $ - $ 1,569,249.70 Table 1 - EER Cost Element Accounts (SAP) EER Summary Cost Element Account Grouping 1 - Travel and Lodging Expenses 2 - Food and Beverage Expenses 3 - Recreational and Entertainment Expenses 4 - Board of Directors Compensation and Expenses 6 - Dues 7 - Gifts 9 - Lobbying Description Travel and Lodging Expenses Lodging Expenses Misc. Travel Expenses Meal Expenses Tickets and Other Entertainment Expenses Director Fees and Expenses Professional and Social Dues Recognition and Rewards Civic and Political Expenses (FERC 426.4) Posting GL Acct Desc 5600191 - Employee Expenses Airfare 5600196 - Employee Expenses Car Rental 5600201 - Employee Expenses Taxi and Bus 5600206 - Employee Expenses Mileage 5600231 - Employee Expenses Parking 5600216 - Employee Expenses Hotel 5600211 - Employee Expenses Conf Seminar Trng 5600236 - EE Expenses Per Diem 5600246 - Employee Expenses Other 5600221 - Employee Expenses Meals 5600226 - Employee Expenses Meals Non-Employee 5600286 - Non - Recoverable Recognition 5600696 - Deductions - Corporate Tickets 5600701 - Deductions - Other 5600656 - Fees - Directors 5600591 - Dues - Professional Association 5600606 - Dues - Lobbying 5600616 - Dues - Chamber of Commerce 5600621 - Dues - Social Service 5600246 - Employee Expenses Other 5600271 - Safety Recognition 5600276 - Life Events 5600281 - Employee Performance Recognition 5600636 - Contributions - Civic and Political Northern States Power Company Table 2 - Key Word Search List Search Key Word Search Order Order 1 Alcohol 63 2 Drinks 64 3 Liquor 65 4 Brewery 66 5 Cocktails 67 6 Beverage 68 7 International 69 8 Golf 70 9 Open 71 10 Avalanche 72 11 Broncos 73 12 Gophers 74 13 Nuggets 75 14 Rockies 76 15 Saints 77 16 Timberwolves 78 17 Wolves 79 18 Twins 80 19 Vikings 81 20 Wild 82 21 Bowl 83 22 Curling 84 23 Fish 85 24 Hockey 86 25 Hunt 87 26 Lucky Strike 88 27 Motocross 89 28 Skeet 90 29 Ski 91 30 Vail 92 31 Face Plant 93 32 Tennis 94 33 Final Four 95 34 Tournament 96 35 WCHA 97 36 Game 98 37 Super Bowl 99 38 Concert 100 39 Ticket 101 40 Levy (events & tickets) 102 41 Pepsi 103 42 Mall of America Field 104 43 HHH 105 44 Allianz Field 106 45 Coors Field 107 46 U.S. Bank Stadium 108 47 Target Field 109 48 TCF Stadium 110 49 MN United 111 50 Casino 112 51 Hooters 113 52 Movie 114 53 Video 115 54 Resort 116 55 Yacht 117 56 Holiday 118 57 Christmas 119 58 XMAS 120 59 Chamber 121 60 Commission 122 61 Contribution 123 62 Election 124 Key Word Legis Lobby Political PUC PAC Repr Senat Brand Sponsorship Team Building Coach Retirement Thank You Gala Birthday Anniv Farewell Going Away Last Day Wedding Baby Bridal Shower Bagel Bereavement Cookies Doughnut Donut Flowers Floral Florist Funeral Fruit Ham Turkey Refreshments Snacks Trinkets New Employee First Day Welcome Get Together Rotary Club Social Event Celebration Party Award Gift Prize Spouse Spa Retreat AGA American Gas Edison Electric EEI Appreciation Recreation Entertainment Recognition Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 12 of 29 Northern States Power Company Table 3 Commonly Used Acronyms Count 1 Acronym ACS 2 AGA 3 AICPA 4 AIHA 5 ANS 6 APDA 7 ARCM 8 ASDSO 9 ASME 10 ATV 11 AWA 12 BART 13 Boiler MACT 14 BWROG Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 13 of 29 Definition "Dues" - American Chemical Society (ACS) is a congressionally chartered independent membership organization which represents professionals at all degree levels and in all fields of chemistry and sciences that involve chemistry. American Gas Association "acct assn" - American Institute of CPAs American Industrial Hygiene Association "Dues" - The American Nuclear Society (ANS) is a not-for-profit, international, scientific and educational organization. It was established by a group of individuals who recognized the need to unify the professional activities within the diverse fields of nuclear science and technology. American Power Dispatchers Association. Founded in 1946 for the purpose of encouraging and promoting the formulation and attainment of higher professional standards among System Operators (Load Dispatchers and Power Dispatchers), and for the purpose of facilitating the interchange of ideas and information, as well as for the development of a spirit of fellowship, the APDA continues to promote excellence in individual education and professional operation of the North American Bulk Electric System. "Travel for Substation Reliability Summit, ARCM kickoff meeting, and various other meetings" - ARCM stands for Adaptive Reliability Centered Maintenance. ASDSO - Association of State Dams Safety Officials. In addition to being regulated by FERC DDS we also fall under State Requirements for Security and for two of our dams that is our only regulator. American Society of Mechanical Engineers Accrediation Team Visit, every four years our training programs in the nuclear area need to be Accredited, similar to accrediation for colleges. Without having an accredited training program, nuclear plants are not allowed to operate. Alternative Work Arrangements - roll out of the flexible work arrangement program BART - Best Available Retrofit Technology evaluations (Energy Supply business area) """Boiler MACT"" is the name given to national emission standards being promulgated by the Environmental Protection Agency in an effort to curb emissions of hazardous air pollutants (HAP) from industrial boilers and process heaters. "BWR (Boiling Water Reactor) Owners' Group (nuclear) - Mission: To provide a forum, in the spirit of partnership with GE, where utility members can achieve higher plant reliability, Definition's Source Internet Internet Internet Internet Internet Internet Employee Employee Internet Employee Employee Employee Internet Internet Northern States Power Company 15 Byron 16 CACJA 17 CGA 18 CIPAC 19 CIPC 20 CLE 21 CMBG 22 CONTE 23 COSS 24 CRIB 25 CRM 26 CRMOC 27 CSAPR Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 14 of 29 maintain and improve plant safety, minimize and share costs and facilitate regulatory interaction. "Byron benchmarking" - RESULTS OF THE BYRON NUCLEAR POWER STATION UNITS 1 AND 2 SIGNIFICANCE DETERMINATION PROCESS PHASE 2 NOTEBOOK BENCHMARKING VISIT Clean Air Clean Jobs Act - In late 2010, the Colorado Public Utilities Commission approved an emissions reduction plan for Xcel Energy under the state's Clean Air-Clean Jobs Act. Compressed Gas Association (CGA) develops and promotes safety standards and safe practices in the industrial gas industry. CIPAC - Critical Infrastructure Protection Advisory Council. "NERC Critical Infrastructure Protection Committee (CIPC) coordinates NERC's security initiatives. The group is comprised of industry experts in the areas of cyber security, physical security, and operational security. CIPC reports to NERC's Board of Trustees. It is governed by an Executive Committee, whose members manage CIPC policy matters and provide support to CIPC's subcommittees and their working groups and task forces. Continuing legal education (CLE; also known as MCLE (mandatory or minimum continuing legal education)) is professional education of lawyers that takes place after their initial admission to the bar. "CMBG Conference" - Configuration Management Benchmarking Group (CMBG) "The American Nuclear Society (ANS) is a not-for-profit, international, scientific and educational organization. It was established by a group of individuals who recognized the need to unify the professional activities within the diverse fields of nuclear science and technology. ""CONTE"" stands for Conference on Nuclear Training and Education - An International Forum on Nuclear Training, Education and Workforce Issues. Cost of Service Study Any items on the report that say CRIB are items purchased to support Monticello inprocessing at the Chelsea Road Inprocessing Building (CRIB). CRM - Customer Relationship Management software. Corporate Risk Management Oversight Committee "CSAPR DC 10/02-10/04" - Judicial Review of EPA's Cross State Air Pollution Rule (CSAPR) - imposes limits on the interstate transport of emissions of nitrogen oxides ("NOx") and sulfur dioxide ("SO2") from multiple states in the eastern, Midwestern, and southern United States that, according to the Environmental Protection Agency (EPA), affect the ability of downwind states to attain and maintain compliance with national air quality standards for particulates and ozone. Internet Internet Internet Employee Internet Internet Internet Internet Employee Employee Employee Employee Internet Northern States Power Company 28 CVI 15 29 DBO 30 DEMS 31 DHS SSA 32 DHS TSA 33 DistribuTECH 34 DLT 35 DO 36 DSCC 37 E&A support 38 EAM 39 ECR 40 EDRM 41 EDS 42 EEAC Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 15 of 29 CVI0015 is "Compliance Violation Investigation #15". The number is assigned by NERC. This is an investigation instituted by NERC "North American Reliability Corporation" who are the regulators overseeing the FERC mandated reliability standards. The investigation is still open and legal holds on all aspects remain in place at this time. Distribution Business Operations DEMS stands for Dynamic Energy Management System. The EMS is used in the control centers to manage, monitor, and control the power flow in and grid. NSP, PSCo & SPS are replacing the current Siemens EMS with a GE EMS. DHS SSA for Dams - Department of Homeland Security Sector Specific Agency for Dams which is responsible for Dams security. "DHS TSA - Department of Homeland Security Transportation Security Administration Office of Pipeline Security which under Secretarial Agreement with the Department of Transportation Regulates our Gas Asset Security. DistribuTECH is the utility industry's leading smart grid conference and exposition, covering automation and control systems, energy efficiency, demand response, renewable energy integration, advanced metering, T&D system operation and reliability, power delivery equipment and water utility technology. Distribution Leadership Team Distribution Operations DSCC - Department of Homeland Security (DHS) Critical Infrastructure Advisory Council (CIPAC) Dams Sector Coordinating Council (DSCC). This is the Private Sector Dam Owner and Operator Coordinating Council. E&A is a required Plant Evaluation and Assessment that is run by the Industry of Nuclear Power Operators and the report and grades are given directly to the CEO this is a requirement of the operation of nuclear units throughout the country. EAM: ideas related to an enterprise asset management and work management system(s). This term is commonly used in connection with the Productivity Through Technology initiative. Employee Concerns Program in conjunction with the Management Safety Review Committee. Electronic document and records management (EDRM) aims to enable organizations to manage documents and records throughout the document life-cycle, from creation to destruction. EDS stands for "Electric Distribution Standards" "Training for managers in Amarillo, EEAC Conference in New Orleans and Business meetings in Denver". The Equal Employment Advisory Council (EEAC) is a nonprofit employer association founded in 1976 to provide guidance to its member companies on understanding and complying with their EEO and affirmative action obligations. Employee Employee Employee Employee Employee Internet Employee Employee Employee Employee Employee Employee Internet Employee Internet Northern States Power Company 43 EEI 44 ELS for Diversity 45 EMD 46 EMDOG 47 ENTELEC 48 EP 49 EPRI 50 EPRI CBUG 51 EPU 52 ERCM 53 ERO 54 ERSC 55 ERWG INPO 56 ESRI 57 EUEC 58 EU-HRMG Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 16 of 29 Edison Electric Institute """50% of 2-day workshop by ELS for Diversity"" - Enlightened Leadership Solutions (ELS) Leadership Development training seminars. - We (ELS) Make Managers Into Leaders quickly and effectively and guarantee your results. The Leadership Challenge: Numerous studies indicate that people join organizations, but they leave bosses. Up to 80% of employee turnover is directly caused by ineffective managers and leaders. Intangible assets like knowledge and information, while hard to measure, account for as much as 75% of an organization's value. "Training for EMD Diesel Engines at Engine Systems Inc. in Rocky Mount, NC." - Electro Motive Diesel (EMD) Engines Emergency Diesel Generator Owners Group ENTELEC is a User Association focusing on communications and control technologies used by petroleum, natural gas, pipeline and electric utility companies. """Mileage Reimbursement for EP meeting in Minneapolis."" Emergency Planning is what EP stands for and is the name of the department that I previously supported. The Electric Power Research Institute (EPRI) is an independent, non-profit company performing research, development and demonstration in the electricity sector for the benefit of the public. The Electric Power Research Institute (EPRI) is an independent, non-profit company performing research, development and demonstration in the electricity sector for the benefit of the public. The EPRI Circuit Breaker Users Group (CBUG) facilitates meetings on each breaker and are intended to provide open discussions on maintenance, maintenance programs, technical issues, operations and maintenance experiences, tools and techniques, motor control center maintenance, switchgear and bus maintenance. Electric Power Uprate Electronic Records Content Management. General Counsel was the first department to fully implement it. The software is called Meridio. Electric Reliability Organization (Transmission) "Travel to FERC and MISO" -Entergy Regional State Committee INPO - the Equipment Reliability Working Group (ERWG) "Certification" - Esri Technical Certification exams are delivered exclusively at Pearson VUE testing centers, worldwide. """EUEC conference"" - ENERGY UTILITY ENVIRONMENT CONFERENCE "Travel to Scottsdale (EU-HRMG), Denver" - Electric Utility-HR Metrics (EU-HRMG). The EU-HRMG is a nuclear industry-wide benchmarking project. The primary focus, in addition Internet Employee Internet Employee Internet Employee Internet Internet Employee Employee Employee Internet Internet Internet Internet Internet Northern States Power Company 59 FAT 60 FEI 61 FEMA 62 FERC 63 FERC DDS 64 FFD 65 FHR 66 FOF 67 FPED 68 FRRB 69 FSA 70 FSRUG 71 Future State 72 FWH 73 FWSI 74 GCC 75 GE7FA Users Group Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 17 of 29 to benchmarking, is HR Metrics and Staffing & Recruiting for the future. Factory Acceptance Test (FAT) "FEI Annual Dues" - Financial Executives International (FEI) Financial Executives International (FEI) is a member-service oriented organization based in Morristown, New Jersey for senior-level financial executives in companies in varying sizes, both public and private, and in all industries. The Federal Emergency Management Agency (FEMA) is an agency of the United States Department of Homeland Security. Federal Energy Regulatory Commission FERC DDS - Federal Energy Regulatory Commission Division of Dam Safety also responsible for/regulates dam security. Fitness For Duty Flint Hills Resources Force On Force exercises. Force Protection Equipment Demonstration (nuclear plant security). Equipment to meet current and evolving force protection needs, anti-terrorist requirements, and the demands of an increasingly broad range of other physical security threats and challenges. Fuel Reliability Review Board FSA is an acronym for focus selfassessment. Duane Arnold is a Nuclear power plant in Cedar Rapids Iowa. FSRUG Feedwater System Reliability User's Group - A way for Feedwater System Engineers to connect, share operational experiences, and recommended practices in order to ensure reliable plant operations. Future State teams in HR - Talent Mgmt to develop improvement initiatives regarding leadership, performance management, succession planning, culture, assessments, and on boarding. "Travel to Pittsburgh to evaluate crack found in FWH @ Holtec Inc." - Feed Water Heater (FWH). Holtec International, a Delaware corporation, is a global turnkey supplier of equipment and systems for the Nuclear, Solar, Geothermal and Fossil Power Generation sectors of the energy industry. BWR (Boiling Water Reactor) Owners' Group (nuclear) Feedwater System Improvement (FWSI) GCC - Department of Homeland Security (DHS) Critical Infrastructure Advisory Council (CIPAC) Government Coordinating Council (GCC). "GE7FA Users Group - To provide an open forum through conferences and technological aids, to the Owners/Operators of General Electric Frame 7F/7H/9F/9H/6FA generator systems for effective communication, discussion, and information dissemination regarding the operation, maintenance, inspection, troubleshooting, and repair of such systems to maximize equipment performance and reliability. Employee Internet Internet Employee Employee Employee Employee Employee Internet Employee Employee Internet Employee Internet Internet Internet Internet Northern States Power Company 76 GPTC 77 Grede 78 Hope Creek Benchmarking 79 HTAC 80 HRBC 81 IECA 82 IEEE 83 IH 84 ILRT 85 INPO 86 INPO ATV 87 INPO E&A 88 INPO EAG 89 INPO SOER 90 IPAD 91 IPTF 92 IRC Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 18 of 29 Gas Piping Technology Committee / American Gas Association. """Grede Meeting"" - Grede is Grede Foundries, a Minnesota retail customer located in St Cloud, MN "Hope Creek Benchmarking; Industry benchmarking for resolution of red / yellow systems" - U. S. Nuclear Regulatory Commission - Hope Creek Generating Station: Additional benchmarking to establish scale model test (SMT) flow rates more representative of main steam flow speeds at current licensed thermal power (CLTP) and EPU conditions. The HTAC is the US Secretary of Energy's Hydrogen and Fuel Cell Technical Advisory Committee. I was appointed by the Secretary to this Committee several years ago and serve as the only utility representative on the Committee. Many of the issues discussed are of relevance to Xcel Energy and utilities in general (both gas and electric), such as stationary fuel cells in distributed generation applications and hydrogen energy storage for renewables integration applications. HRBC stands for Human Resource Business Consultant. The purpose of HRBC meetings is to bring all HRBC's (assigned to various business areas) together as a staff to discuss updates on ongoing HR initiatives (i.e., MERIT increases, IPAD, etc), upcoming roll out of new / or changes to initiatives or policy changes and focus on continuity in policy interpretation around HR issues across the company. International Energy Credit Association. This is an organization which provides training to credit and contract administration professionals in the energy credit industry. These conferences have training sessions reflecting new contract issues impacting the industry, in 2012, this conference focused a lot on Dodd Frank contracting compliance issues. "Industry Dues" - IEEE, pronounced "Eye-triple-E", stands for the Institute of Electrical and Electronics Engineers. IEEE is the world's largest professional association dedicated to advancing technological innovation. Industrial Hygiene - Corporate Industrial Hygiene Support Prairie Island plant integrated leak rate test (ILRT). INPO - The Institute of Nuclear Power Operations promotes excellence in the operation of nuclear electric generating plants. INPO Accreditation Team Visit. (ATV) INPO E&A and Training Accreditation Auditor. INPO - Advisory Group (EAG) INPO - SOER 10-2, "Engaged, Thinking Organizations" which says you need to have a "thinking" organization. Individual Performance And Development (IPAD) - Corporate employee performance evaluation reporting and review process. Interconnection Process Task Force Investment Review Council Employee Employee Internet Employee Employee Employee Internet Employee Employee Internet Internet Internet Internet Internet Employee Employee Employee Northern States Power Company 93 IRWA 94 ISA 95 ISCD 96 JAC 97 JTA 98 KPI 99 KPMG 100 KPMG IFRS 101 LPI 102 LRIWG 103 LRTF 104 MARC 105 MASMS Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 19 of 29 IRWA - The International Right of Way Association (IRWA) creates public awareness, trust and confidence in the right of way process. IRWA has united the efforts of its members toward professional development, strong ethics and improved service to employers and the public, along with advancements within the right of way profession. IRWA is the unsurpassed source of right of way educational programs and professional services worldwide. Dedicated exclusively to the right of way profession, IRWA has nearly 10,000 members throughout the U.S. and Canada. Our members are multi-disciplined professionals employed by private industry and government agencies. ISA Resources -The International Society of Automation is a nonprofit organization that helps its 30000 worldwide members and other automation professionals ISCD - Department of Homeland Security Chemical (Infrastructure Security Compliance Division) which regulates and enforces security for our Registered (18) and Tiered (2) Chemical Facilities. "JAC Meeting" - JAC stands for Joint Apprenticeship Subcommittee, which I am a member representing the Chestnut Hazardous Waste Storage Facility and our Union apprenticeship program. JTA - Job and Task Analysis. I was assessing each Operators capability to perform Power System Operations tasks in accordance with NERC Standard PER-005, Requirement 2. Key Performance Indicator "KPMG is a global network of professional firms providing Audit, Advisory and Tax services. KPMG's Executive Education Continuing Education for Corporate Executives and their Staffs. Meet with KPMG regarding International Financial Reporting Standards (IFRS) readiness assessment proposal." KPMG is a global network of professional firms providing Audit, Advisory and Tax services. "LPI Meeting" - LPI stands for Liberty Paper Incorporated in Becker, a Minnesota retail electric customer of NSP Attend the NEI License Renewal Implementation Working Group (LRIWG) meeting in Miami, FL LRTF Meeting supporting license renewal aging management. LRTF stands for (Babcock & Wilcox Owners Group (B&WOG)) License Renewal Task Force Mid-America Regulatory Conference "MASMS" - The Minnesota Educational Facilities Management Professionals (also known as MASMS) is a group of over 300 individuals in the area of facilities/grounds/health & safety/operations. The purpose of MASMS is to develop and maintain high standards in the administration, care, operation, planning, budgeting and development of buildings and Internet Internet Employee Employee Employee Employee Internet Internet Employee Internet Internet Employee Internet Northern States Power Company 106 MCT 107 MIPSYCON 108 MISO 109 Mk5 Control System training 110 MNGP 111 MNCPA 112 MNOPS 113 MNSEIA 114 MP 115 MRM 116 NAEMA Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 20 of 29 grounds used by public and nonpublic educational facilities. "MCT" stands for Material Coordination Team, a new team formed under Supply Chain. The main responsibility is ensuring that materials are on time in full for all Substation and Transmission projects prior to construction start. The initiative spans all three OPCO's for coverage and our primary role is coordination of materials from the Supplier/Distributor to the Xcel Energy jobsite and/or Xcel Energy Warehouse for all major Substation and Transmission projects. We are striving for keeping crews working and having the materials at the right time, right place for increased productivity. MCT works with Engineering, Design, Construction, Buyers, Accounts Payable, Project Controls, Sourcing, Suppliers, & Warehousing to accomplish these tasks. "Minnesota Power Systems Conference (MIPSYCON) - provides electric utility engineers and consultants the opportunity to stay abreast of today's power system technology. The conference emphasizes the unique challenges faced by electric utilities in the Midwest. The conference also serves as a forum for power engineers to meet with their colleagues from other utilities to discuss mutual concerns. "Midwest Independent System Operator (MISO) is an essential link in the safe, cost-effective delivery of electric power across much of North America. We are committed to reliability, the nondiscriminatory operation of the bulk power transmission system, and to collaborating on creating costeffective and innovative solutions for our changing industry. "Mk5 Control System training in Salem, VA" - GE Energy Technical Training - This course provides training on the essential elements of the Mk V turbine control system. The course will include instruction on the hardware and software components of the Mk V control system and its interface system (HMI). Alarm troubleshooting and LVDT calibration will be central topics of the program. Monticello Nuclear Generating Plant "acct assn" - Minnesota Society of CPAs Minnesota Office of Pipeline Safety The Minnesota Solar Energy Industries Association (MnSEIA) represents and serves Minnesota energy professionals and solar energy users. Marquette Plaza office - Minneapolis Management Review Meeting - these meetings are conducted to discuss process and expenditure changes that are made by the site management are subsequently reviewed by corporate management to ensure alignment with the Company's business goals. The North American Energy Markets Association (NAEMA) is an independent, nonprofit trade Employee Internet Internet Internet Employee Internet Internet Internet Employee Employee Internet Northern States Power Company 117 NAPCO 118 NARUC 119 NDE 120 NEI / NEA 121 NEIL 122 NERC 123 NESCSL 124 NFPA 125 NICET 126 NIEP 127 NNSC Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 21 of 29 association representing entities involved in the buying and selling (marketing) of energy or in providing services to the energy industry. North American Power Credit Organization "National Association of Regulatory Commissioners (NARUC) is the national association representing the State Public Service Commissioners who regulate essential utility services in your State. NARUC members are responsible for assuring reliable utility service at fair, just, and reasonable rates. Non-destructive examinations "The Nuclear Energy Institute (NEI) is the policy organization of the nuclear energy and technologies industry and participates in both the national and global policy-making process. NEI's objective is to ensure the formation of policies that promote the beneficial uses of nuclear energy and technologies in the United States and around the world. The Nuclear Energy Agency (NEA) is a specialized agency within the Organization for Economic Co-operation and Development (OECD), an intergovernmental organization of industrialized countries, based in Paris, France. Nuclear Electric Insurance Limited (NEIL) - The Company insures electric utilities for damages to insured sites, decontamination expenses incurred at such sites arising from nuclear contamination, other risks of direct physical loss at such sites, certain premature decommissioning costs, and the costs associated with certain long-term interruptions of electricity supply. NERC "North American Reliability Corporation" who are the regulators overseeing the FERC mandated reliability standards. Nuclear Energy Supply Chain Strategic Leadership "Codes" - National Fire Protection Association (NFPA) - The world's leading advocate of fire prevention and an authoritative source on public safety, NFPA develops, publishes, and disseminates more than 300 consensus codes and standards intended to minimize the possibility and effects of fire and other risks. "License" - National Institute for Certification in Engineering Technologies (NICET) defines engineering technicians as the "hands-on" members of the engineering team who work under the direction of engineers, scientists, and technologists. More than 125,000 technicians and technologists have met NICET's rigorous certification criteria, and the number grows rapidly as more employers and local and state governments rely on NICET certification to measure the qualifications of their workforce. Nuclear Industry Evaluation Program (NIEP) - Insights to influence performance excellence at operating nuclear power plants. The National Nuclear Security Conference is an opportunity for Employee Internet Employee Internet Internet Employee Employee Internet Internet Internet Internet Northern States Power Company 128 NRA 129 NRC 130 NRC RIC 131 NRRPT 132 NSCA 133 Nuclear AA/FFD 134 NUCC 135 NWSC 136 ODL 137 OH 138 PAC 139 PACT 140 PBAPS 141 PINGP 142 PM 143 PMI 144 PowerPlan Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 22 of 29 security professionals to gather, exchange ideas and participate in discussions on the latest industry and Nuclear Regulatory Commission trends. "NRA" - The National Rifle Association (PI FOF and Range/Training Items) The Nuclear Regulatory Commission NRC - Regulatory Information Conference (RIC) "NRRPT Annual Dues" - The National Registry of Radiation Protection Technologists (NRRPT) Nuclear Safety Culture Assessment (NSCA) - All operating nuclear power plants strive to receive the coveted INPO "Excellent" rating on their evaluations; therefore, when the organization released the Principles for a Strong Nuclear Safety Culture in late 2004, nuclear power plant owners took notice. The Utilities Services Alliance Inc. (USA) responded to the INPO document and focused on ensuring its member plants operate in what it calls a "Strong Nuclear Safety Culture." USA developed the Nuclear Safety Culture Assessment (NSCA) process tool. The tool's purpose is to evaluate an organization's overall safety culture and provide an early warning of areas where that culture could be beginning to erode. The tool is a formal mechanism that judges plant personnel's behaviors to ensure they maintain the appropriate focus on nuclear safety. Nuclear Access Authorization (AA) The licensee for each nuclear power plant licensed under 10 CFR Part 50 is required to develop, implement, and maintain an Access Authorization (AA) program to protect against an insider threat at the plant. Fitness For Duty (FFD) - implementation of 10 CFR Part 26 Fitness for Duty Program requirements. Nuclear Utility Coatings Council Nuclear Waste Strategy Coalition Outdoor Lighting - Distribution Operations Overhead Electric Service Lines Distribution Operations PAC stands for "Program Advisory Committee". This acronym is used by Energy Supply and Nuclear Generation employees. These are quarterly training meetings. The maintenance programs that require these meetings are I&C, Electrical and Mechanical. PACT is the Professional Association of Computer Trainers. "Traveled to PBAPS in Delta, Pa to walk down their RP Remote Monitoring Camera system." - Peach Bottom Atomic Power Station (PBAPS) is a two-unit nuclear generation facility located on the west bank of the Conowingo Pond (Susquehanna River) in Delta, Pennsylvania. Prairie Island Nuclear Generating Plant-PINGP Project Manager Project Management Institute "Work with PowerPlan in Denver" PowerPlan's business performance management (BPM) solution provides Employee Internet Internet Internet Internet Internet Employee Employee Employee Employee Employee Employee Internet Employee Employee Employee Internet Northern States Power Company 145 PRA 146 PRDIG 147 PTL 148 PTT 149 PWG 150 PWR Owners Group 151 PWROG 152 Quad FBM 153 RDF 154 RFP FAT 155 REC 156 RIC 157 RIMS 158 River Bend 159 RMEL 160 RPC Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 23 of 29 powerful budgeting, in-depth analysis, and flexible reporting features that replace spreadsheets and cumbersome, error-prone tools. Probabilitistic Risk Assessment (PRA) Modification Pressure Relief Device Interest Group (PRDIG) "PTL Meeting at Wilmarth" - PTL is short for "Pathway to Leadership" and the meeting was at the Wilmarth power plant. Pathway to Leadership is a program Xcel Energy has initiated to identify and develop future leaders for the company in a mentoring intense setting. In this program, members of our mentoring group visited a small Refuse Derived Fuel (RDF) power electrical generating facility and had our monthly meeting on site. The topic was on Trust in the Workplace. Productivity Through Technology (PTT) is a commitment to uncover innovative solutions to employees' work challenges. We are evaluating technologies that can streamline, simplify, and improve work processes throughout the Operations and Nuclear organizations. "THIS IS PSCo: PWG stands for Performance work group, it's part of WECC Western Electric coordinating council which PSCO is a part of the interconnection (www.wecc.biz) I am on the PWG group which helps define standards for WECC and NERC and assists with compliance of members." Pressurized Water Reactor (PWR) Owners Group (nuclear) "Pressurized Water Reactor Owners Group - Nuclear - Attend the PWROG Meeting Formal Benchmark of Quad Cities Nuclear Generating Station. RDF - Renewable Development Fund Request For Proposal (RFP) Renewable Energy Credits U.S. Nuclear Regulatory Commission's (USNRC's) Regulatory Information Conference (RIC) Risk Management & Insurance Society """Benchmark trip to River Bend"" River Bend Nuclear Generating Station is a nuclear power station on a 3,300acre (13 km2) site near St. Francisville, Louisiana, approximately 30 miles (50 km) north of Baton Rouge. The plant has a General Electric 978 MW[1] boiling water reactor, which began operation on June 16, 1986. River Bend is operated by Entergy Nuclear and owned by Entergy Gulf States, Inc. RMEL is a not-for-profit energy trade association that has served the electric utility industry with a variety of education and networking services since 1903. Dedicated to fostering a thriving community of electric energy professionals, RMEL's 300 corporate members share ideas, techniques and programs to better serve the industry and its customers. Once known as the Rocky Mountain Electrical League. "NSP Plant Visit, NSP Directors' and NSP RPC attendance" - RPC is the "Regional Project Committee" capital project meeting. Committee meets to Employee Employee Employee Internet Employee Internet Internet Employee Employee Employee Employee Internet Internet Internet Internet Employee Northern States Power Company 161 RPS 162 RSC 163 RTC 164 S3 165 SACC Job Fair 166 SAG 167 SAGE 168 SAS 169 SAWG 170 SC 171 SCC 172 SCCIA 173 SCLT 174 SCSU 175 SDG&E Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 24 of 29 review Energy Supply's ongoing & future capital projects. RPS - Renewable Portfolio Standard (RPS). "RSC" stands for Regional Safety Committee. Each of our power plants in the MN/WI region has a safety committee. The RSC is composed of one or two members from each of our region's plant safety committees (approx. 25 people). The RSC works on safety issues/initiatives at a regional level. Riverside Training Center (Riverside generation plant) Sherco Generation Plant - Unit #3 Registration fee for the Washington, D.C. SACC Job Fair"" - Service Academy Career Conference (SACC) Job Fair: Recruiting for: Engineers, Pilots, Program Managers, Business and Cost Analysts etc. This was a job fair for Service Academy alumni/veterans. The purpose of attending this job fair was to support military hiring at Xcel Energy and recruit Service Academy alumni/veterans for opportunities at Xcel Energy; these types of new hires, with specialized training, add immediate value to an organization. The registration fee was a flat rate; however, we did have 3 employees attend to recruit at this event. Safety Advisory Group (SAG). Each geographical work area has a field employee assigned as a member to the Safety Advisory Group (SAG). These groups meet regionally monthly and jointly on a quarterly base to proactively seek solution to safety concerns and enhance workplace safety. Supportive Association for Gay, Lesbian, Bi-Sexual, Transgender, Ally Employees "SAS is the leader in business analytics software and services and the largest independent vendor in the business intelligence market. "Supply adequacy working group Supply Chain department. SCC - Department of Homeland Security (DHS) Critical Infrastructure Advisory Council (CIPAC) Dams Sector Coordinating Council (DSCC). This is the Private Sector Dam Owner and Operator Coordinating Council. SCCIA promotes the formation and growth of captive insurance programs. Captive insurance programs are a valuable tool for many corporate entities looking for a better way to manage risk. SCLT stands for "Supply Chain Leadership Team" meeting where all direct reports gather to plan the department budget, plan our projects and initiatives, safety programs, training and address critical operating requirements for the upcoming year. Since all of us have employees in all regions it is critical we are consistent and aligned with each region's operating priorities. St. Cloud Minnesota State University San Diego Gas & Electric - a Sempra Energy utility. Employee Employee Employee Employee Employee Employee Employee Internet Employee Employee Internet Employee Employee Internet Northern States Power Company 176 SFDC 177 SFPE 178 SGA 179 SGMP TAG 180 SGS 181 SHC 182 SIM 183 SHRM 184 SISW 185 Skire Unifier Software 186 S&T 187 SL&R 188 SLT 189 SME 190 Sox 191 SPP 192 Star Achievement Certification 193 STEP Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 25 of 29 SFDC - SalesForce.Com. The meetings were to set the requirements for our new CRM (customer relationship management) software. Society of Fire Protection Engineers Southern Gas Association - a 501 (c)(6) organization. Serves members who conduct business in the following sectors of the natural gas industry: Distribution, Transmission (pipeline) and Gas Supply Marketing. Produces events and manages joint industry projects, conducts surveys on business critical issues, and facilitates peer-to-peer collaboration for the purpose of identifying and implementing best practices. Steam generator management program technical advisory group SGS is the world's leading inspection, verification, testing and certification company. The Company was first registered in Geneva as Société Générale de Surveillance in 1919. Sherco Fossil Plant. SIM - Strategic Initiative Meeting "SHRM" - The Society for Human Resource Management (SHRM) is the world's largest association devoted to human resource management. Representing more than 250,000 members in over 140 countries, the Society serves the needs of HR professionals and advances the interests of the HR profession. Safety Intervention and Stop Work training. This was required training. The training was required to be completed in a specific time frame so travel was required to the sites where the employees were working. Skire's Unifier (software) offers an agile, web-based, collaborative solution for organizations looking to manage, maintain and optimize their property portfolio, facilities and capital assets. Safety and Training department Siting and Land Rights department. Senior Leadership Team "Travel for meetings in order to transition from SME to Sub Syst Perf department" - SME stands for Substation Maintenance Engineering Sarbanes-Oxley (SOx) - The SarbanesOxley Act of 2002, or SOX, is a United States federal law that set new or enhanced standards for all U.S. public company boards, management and public accounting firms. Southwest Power Pool Electric Energy Network Star Achievement Certification Part III"" (training) - Star Achievement Certification: The Star Achievement Series® is a training program developed by the Founder and CEO of Office Dynamics, Ltd, Joan Burge. Joan is an author and national corporate trainer with over 25 years of experience in the administrative and training profession. The philosophy behind Star Achievement® is that it takes a combination of skills, attitude, teamwork and strategies to stay on the cutting edge. STEP - Success Through Employee Participation employee development program Employee Employee Internet Employee Internet Employee Employee Internet Employee Internet Employee Employee Employee Employee Internet Internet Employee Employee Northern States Power Company 194 SUG 195 SWG 196 Taleo 197 TAPS 198 TLP 199 TM 200 TMI 201 TRO 202 True North 203 TSPS 204 TSS 205 TW 206 UCMDB 207 UFLS 208 UG 209 UHC 210 UI Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 26 of 29 The Settlement User Group shall be utilized to develop recommendations related to financial settlements of Energy Market activities administered by SPP. "SWG Meeting" - SWG stands for Security Working Group. It is a group of utility security professionals, NEI (Nuclear Energy Institute) and NRC folks. The Oracle Taleo Cloud Service enables enterprises and midsize businesses to recruit top talent, align that talent to key goals, manage performance, develop and compensate top performers, and turn today's best performers into tomorrow's leaders. TAPS - Travel and Procurement System. The new SumTotal application includes functionality to require users to upload scanned images of required receipts and attach them to their expense report systematically. TLP - Transmission's Transmission Line Performance department TM - Human Resources' Talent Management department TMI - Three Mile Island nuclear generation plant TRO stands for Transmission Resource Optimization. The substation group although in the transmission business unit actually works on both transmission and distribution substation assets. "True North Membership Dues" - True North Consulting is an Engineering Services company specializing in support for the electric power industry. Founded in 1999, True North has provided engineering based consulting services to the majority of US utilities and to several abroad. TSPS - Transmission & Substation Performance and Standards. TSS - Transmission and Substation Standards Towers Watson Vendor - a leading global professional services company that helps organizations improve performance through effective people, risk and financial management, offering solutions in the areas of benefits, talent management, rewards, and risk and capital management. UCMDB is Universal Configuration Management Data Base. It's a system that tracks, records, and correlates hardware and software throughout the company. We are implementing the uCMDB for monitoring and controlling assets and asset interactions across the company. Under Frequency Load Shed Distribution Electric Engineering program Under Ground systems United Healthcare vendor - Health insurance and medical care options for employer groups. Utilities International, Inc. vendor Utilities International's UIPlanner software is designed specifically for utilities. UIPlanner is now the leading financial planning software within the utility industry. Internet Employee Internet Employee Employee Employee Employee Employee Internet Employee Employee Internet Employee Employee Employee Internet Internet Northern States Power Company 211 USA 212 USUG 213 USSD 214 USWAG 215 UVIG 216 UWIG 217 Ventyx 218 VOC 219 VOIP 220 WAPA 221 WECC 222 WFC 223 WFP 224 WFR 225 WICF Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 27 of 29 Utilities Service Alliance (USA) is a not-for-profit cooperative designed to facilitate collaboration among its member utilities. Together, we work to reduce operating and maintenance costs, improve safety and performance, and provide innovation and leadership within the nuclear power industry. Utility Simulator Users Group "Simulator Supervision MNGP ILT, NRC Exam Post Exam Activities, ANSI/ANS-3.5 Committee Meeting FERC - United States Society on Dams Utility Solid Waste Activities Group USWAG provides the most comprehensive, knowledgeable and experienced legal and technical resources on utility solid waste management issues available. Utility Variable-Generation Integration Group - The UVIG Board of Directors officially voted to change our name from the Utility Wind Integration Group (UWIG) to the Utility VariableGeneration Integration Group at the board meeting in Maui last October. The change was driven by requests from our members facing rapid growth from solar generation. Utility Variable-Generation Integration Group - The UVIG Board of Directors officially voted to change our name from the Utility Wind Integration Group (UWIG) to the Utility VariableGeneration Integration Group at the board meeting in Maui last October. The change was driven by requests from our members facing rapid growth from solar generation. Ventyx, an ABB company, is the world's leading supplier of enterprise software and services for essential industries such as energy, mining, and public infrastructure. VOC is an internal abbreviation for Voice of the Customer, an ongoing tracking market research study of customer perceptions of Xcel Energy. Focus groups were held to provide direction for the online portion of the work now underway. VOIP - Voice Over Internet Protocol Western Area Power Administration The Western Electricity Coordinating Council (WECC) is the Regional Entity responsible for coordinating and promoting Bulk Electric System reliability in the Western Interconnection. WFC - Human Resources Workforce Strategy department's "Work Force Council" "WFP is "Work Force Planning", which is a major ongoing Corporate HR and Operations initiative to make sure our staffing is "right-sized", with the right number and mix of employee grades and skill sets for the future. Also part of this is developing short- and longterm plans to prepare the Company for employee retirements and the associated loss of institutional knowledge. WFR - Human Resources' Safety & "Work Force Relations" department "The Western Interconnection Compliance Forum (WICF) has emerged as a dynamic information Internet Internet Internet Internet Internet Internet Internet Employee Employee Internet Internet Employee Employee Employee Internet Northern States Power Company 226 WIL 227 WIN 228 WSPP 229 WUA Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 28 of 29 sharing organization within the Western Interconnection. It is run by and on behalf of entities subject to WECC and NERC compliance requirements." WIL - "Women in Leadership" is an industry professional organization WIN - "Women's Interest Network" which is an Xcel Energy employee network group. Our team often supports various employee events they hold to develop their members (Xcel Energy employees), focused on career development, competencies and interviewing skills. Western Systems Power Pool (WSPP) is an agreement and an organization that creates power trading opportunities and allows WSPP members to manage power delivery and price risk. The Current WSPP Agreement effective April 23, 2012, updated July 12, 2012, is the most commonly used standardized power sales contract in the electric industry. It is approved by the FERC and used by jurisdictional and non-jurisdictional entities. Wisconsin Utilities Association Employee Employee Internet Internet Northern States Power Company Table 4 - TIME Earnings Codes Docket No. E002/GR-20-723 Exhibit__(WKH-1), Schedule 8 Page 29 of 29 Earning Code Group Per Diem-Related Meal-Related Mileage-Related Allowance-Related Other Earning Code Desc Per Diem Overnite Per Diem Rptg - T/R Per Diem Overnite Tx Per Diem Non-Tx M&I PerDiem Txbl M&I Per Diem Taxable Per Diem Overnite No Overtime Meal Taxabl Overtime Meal Cash Taxable Meal Meal Non-Taxable Zone Mileage Casual Use Mileage Maximo Mileage BA Site Allowance Outage Allowance Midweek Trnsfr Pymt Reporting Pay Daily Trav-Res Share Boiler Lic Reimburse Daily Assg-Res Share Parking Reimbursment Uniform Reimbursement Northern States Power Company Fleet Capital Additions Fleet, Tools, & Equipment - Capital Additions State of MN Electric Jurisdiction Includes AFUDC Capital Budget Groupings Fleet Asset Additions Fleet Asset Additions Fleet Asset Additions Fleet Asset Additions Fueling Depots and Garage Tools Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Replacements, Additions, & Repairs Grand Total Func Class Descr Electric General Plant Electric General Plant Common General Plant Common General Plant Common General Plant Common General Plant Common General Plant Common General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant Electric General Plant WBS Level 2 Description A.0006056.289 Fleet-PHEV-<$50K-Dist Elec-NSPM A.0006056.297 Fleet-PHEV-NSPM < $50K Transmission A.0006056.288 Fleet-PHEV-NSPM Dist < $50K COMMON A.0006056.291 Fleet-PHEV-NSPM-ND-Dist COMMON A.0006056.246 MN - Dist Fleet Transp Tools Common A.0006056.003 MN-Dist Fleet New Unit Purchase Com A.0006056.206 MN-Dist Fleet New Unit Purchase Com A.0006056.219 ND-Dist Fleet New Unit Purchase Com A.0006056.002 MN-Dist Fleet NewUnit Prchse El Ops A.0006056.091 MN Transportation Units Over 50K A.0006056.146 Transportation Blanket Trans M A.0006056.205 MN-Dist Fleet NewUnit Prchse El Ops A.0006056.215 ND-DIST Fleet New Unit Purchase El A.0006056.216 SD-Dist Fleet New Unit Purchase El A.0006056.221 Fleet New El Trans MN <$50K A.0006056.235 SER-SMC-Vehicles <$50K A.0006056.241 SER-CSC-Vehicle Purchase <$50K A.0006056.242 MN- Fleet New Unit Purch Nuclear Docket No. E002/GR-20-723 Exhibit___(WKH-1), Schedule 9 Page 1 of 1 2021 30,499 377,356 25,157 591,956 937,462 241,931 3,252 10,026,307 2,775,403 - 514,995 643,650 1,015,904 100,211 784,258 261,419 18,329,761 2022 191,708 - 528,298 25,157 312,699 746,891 192,256 45 8,493,735 4,840,617 699,188 782,718 932,958 300,632 995,485 261,419 19,303,806 2023 191,708 - 41,486 836,355 199,724 1 6,907,355 6,583,413 712,859 662,085 854,543 387,772 995,485 34,858 261,419 18,669,061 PUBLIC DOCUMENT HIGHLY CONFIDENTIAL NOT PUBLIC DATA HAS BEEN EXCISED Northern States Power Company Docket No. E002/GR-20-723 Exhibit___(WHK-1), Schedule 10 Page 1 of 2 Employee Labor Costs for Lobbying Activities In compliance with ALJ Finding 557 in Docket No. E002/GR-10-971, this schedule includes a report of the total compensation for employees engaged in lobbying, with an explanation of the costs included and excluded in the rate request. This schedule shows the total salary budgeted for 2021 employees engaged in lobbying and other civic and political type activities. This includes employees whose compensation is, in part, included in this rate request. Employee labor costs are budgeted within a department by level of position based on the average salary for that position. The department labor costs are then allocated between lobbying and non- lobbying activities at an aggregated level and reported in total for each department. Labor costs are also not uniquely identified in the budget specific to just legislative lobbying. FERC account 426.4 includes lobbying and other civic and political type activities. Using this budgeting process, the approximate percentage of time spent by each of the employees performing lobbying and other civic and political type activities is shown in this schedule. This is the percentage that is budgeted below the line. Using this budgeting process, this schedule also shows the amount included in above the line FERC account 920 for 2021. Northern States Power Company Employee Comensation for Lobbying Activities - Highly Confidential Docket No. E002/GR-20-723 Exhibit__(WKH-1) Schedule 10 Page 2 of 2 PUBLIC DOCUMENT NOT PUBLIC AND HIGHLY CONFIDENTIAL DATA HAS BEEN EXCISED Lobby Costs NSPM Government Affairs - MN 102333 Lobbying Activities = 20% Non Lobbying Activities = 80% Job Code DIR581: Director Regional Government Affairs TML115: Manager State Government Affairs Number of Positions Average Salary [PROTECTED DATA BEGINS Total of Average Lobbying Labor Non-Lobbying Labor Salaries Costs (1) Costs (2) Federal Government Affairs - 102629 Lobbying Activities = 60.7% Non Lobbying Activities = 39.3% Job Code AST271: Administrative Assistant COS280: LOBBYIST*FEDERAL GOVN'T AFFAIR DIR796: SR DIR*FED GOVTL AFFAIRS COS613: PAC Manager Community Relations - MN - 102346 Lobbying Activities = 7.3% Non Lobbying Activities = 92.7% Job Code AST273: Administrative Assistant COS180: Community Relations Manager COS449: MANAGER*EXTERNAL AFFAIRS DIR647: Director Community Relations Number of Positions Average Salary [PROTECTED DATA BEGINS Number of Positions Average Salary [PROTECTED DATA BEGINS PROTECTED DATA ENDS] Total of Average Lobbying Labor Non-Lobbying Labor Salaries Costs (1) Costs (2) PROTECTED DATA ENDS] Total of Average Lobbying Labor Non-Lobbying Labor Salaries Costs (1) Costs (2) Policy & Federal Affairs - 102456 Lobbying Activities = 4% Non Lobbying Activities = 96% Job Code AST252: ASSISTANT*EXECUTIVE OFC300: SVP, Strategy, Planning & External Affairs PROTECTED DATA ENDS] Number of Positions Average Salary [PROTECTED DATA BEGINS Total of Average Lobbying Labor Non-Lobbying Labor Salaries Costs (1) Costs (2) PROTECTED DATA ENDS] Notes: (1) Approximate amount of compensation included in below the line FERC account 426.4 (2) Approximate amount of compensation included in above the line FERC account 920