Office Remodel Project

Frequently Asked Questions

1. Why does the co-op need to remodel?

A. Growth: Since 1970 the needs and technology to serve Federated members has evolved. At the time Federated had nine inside employees and 15 in the line crews to serve 4,500 member-owners in Jackson and Martin Counties. Today, Federated serves 5,300 members with 6,900 electric accounts with 31 employees so space is becoming an issue as we grow. This includes five broadband employees to serve Federated members with internet service; the Broadband Department expects to grow to 2250 fiber subscribers along with 1,200 fixed wireless accounts, which will mean additional employees in the future. Federated’s lunch room/employee meeting room is no longer large enough for group training and group events. The remodel will feature a linemen meeting room and outage response center. Back in 1970 there were no personal computers, only one “mainframe” with punch cards. Today each employee has a personal computer, monitors, internet, and printers to serve members. 

B. Maintenance: Federated’s office is 56 years old. The plumbing is starting to fail in each of the main bathrooms nor are they handicap accessible. Not enough electrical or data outlets exist for today’s technology. The roof, which switched from a flat roof to a peaked metal roof in 1993 needs maintenance; it is leaking and has some structural issues due to snow loading with fractured 2x4 rafters, which must be removed. A rubber bladder roof will be installed that features a 30-50 year warranty. Insulation is substandard from the 1970s The remodel project will increase energy efficiency. While the office ground source heat pump was recently upgraded and served as the main heating/cooling system for years, RTU (Rooftop Unit) being a self-contained, packaged heating, ventilation, and air conditioning system installed on a building's roof, combining cooling (compressor, condenser, evaporator coils), heating (gas furnace/electric coils), and air handling into one box for commercial spaces like retail stores, schools, and offices, saving indoor space and simplifying maintenance have been selected for the project.  The GSHP system will remain in service and serve as a backup as well as being used in other areas of the facility. With this major upgrade the state may require the addition of fire sprinkler system.

C. Technology: Federated will add an IT room to host its own servers and Network Operations Center (NOC) for the broadband operation with security in a cyber world. Rather than rely on outside vendors, Federated will add staff for the broadband technology and dedicated employees to serve our members. 

2. Timeline for the office remodeling project? 

Back in 2017 Federated hired Olson Hobbie architects to evaluate the existing headquarters performing a facilities assessment. With the growth of employees in 2024, management hired Oleson Hobbie Architects from Mankato once again to act on those recommendations preforming a building evaluation study. This will serve as the roadmap for the remodel project planned to begin in 2026. Inside employees were asked for their input and reviewed early blueprint plans for offices and how to make more efficient use of the existing space. The Board of Directors approved unanimously that the cooperative should take the next steps in finalizing costs, timeline, and process. Bids were sought January 2, 2026. Inside employees will move to the Belmont Townhomes temporarily during the remodeling process with a targeted completion date of late 2026 or early 2027.

3. Will my rates go up for this headquarters remodeling project?

Federated will finance the building remodeling project just like it finances new line construction and upgrades with long-term loans over a period of 30 years. This way the building is paid by the members who benefit now and in the future. Federated’s high equity level helps make this possible. There are several factors that come into play when rates are discussed and results in rate increases. This project is not the main catalyst to cause a rate increase. Power supply being 80 cents of every dollar spent will continue be the main catalyst with labor costs also being a contributor.

4. Wouldn’t a new construction project be cheaper?

Federated briefly looked at a new facility; however, logistically and cost wise it did not become a serious thought. The warehouse addition in 2008 provided space for the larger line trucks and equipment. Other Minnesota electric cooperatives with new construction projects are spending anywhere from $8M to $16 million dollars. The office remodeling is estimated around $5.0 million. The facility itself has “good bones” structurally so it’s a good plan to remodel vs constructing new.

5. Will customer service suffer during construction?

No. Our goal is to continue to provide fast, efficient service to our member-owners. Members may be able to use the same drop box for payments in front of the headquarters however we need to make sure that construction progress will not prohibit your ingress and egress so we will keep you updated on that. Members needing face-to-face meetings can call and schedule an appointment.