01-30-2019 HUCMMINUTES
Regular Meeting — Hutchinson Utilities Commission
Wednesday, January 30, 2019
Call to order — 3:00 p.m.
President Morrow called the meeting to order at 3:00 p.m. Members present: President
Monty Morrow; Secretary Robert Wendorff; Commissioner Don Martinez; Commissioner
Matt Cheney; GM Jeremy Carter; Attorney Marc Sebora.
Absent: Vice President Anthony Hanson
1. Conflict of Interest
2. Commission Reorganization
President Morrow called for the annual Commission reorganization.
a. A motion made by Commissioner Wendorff, second by Commissioner Cheney
to elect Don Martinez to the position of president. Motion unanimously carried.
b. A motion made by President Morrow, second by Commissioner Martinez to elect
Matt Cheney to the position of vice president. Motion unanimously carried.
c. A motion made by Commissioner Martinez, second by Commissioner Cheney to
re-elect Robert Wendorff to the position of secretary. Motion unanimously
carried.
d. A motion made by Commissioner Martinez, second by Commissioner Wendorff
to appoint Marc Sebora as legal counsel. Motion unanimously carried.
e. A motion made by Commissioner Martinez, second by Commissioner Cheney to
appoint Angie Radke as recoding secretary. Motion unanimously carried.
A motion made by Commissioner Martinez, second by Commissioner Wendorff
to designate Citizens Bank & Trust, Wells Fargo Bank, Wells Fargo Advisors,
Home State Bank, Morgan Stanley and Cetera Investment Services as
depositories for utility funds. Motion unanimously carried.
3. Approve Consent Agenda
a. Approve Minutes
b. Ratify Payment of Bills
A motion made by Commissioner Cheney, second by Commissioner Wendorff to
approve the Consent Agenda. Motion unanimously carried.
4. Approve Financial Statements
GM Carter presented the financial statements. GM Carter noted that it can be
difficult to compare December 2017 to December 2018 with year-end adjustments
especially with GASB Pension Liability adjustments. On the Natural Gas side, net
income increased by $438,147. Revenue was down mostly due to the swing of
$578,429 in fuel cost adjustments but also less usage due to warmer temperatures.
On the Electric side, Sales for Resale are higher. Overall Purchased Power
increased by 6,566. MRES purchases decreased by $8,281 and market
purchases/MISO costs increased by $14,847. Overall, trending as anticipated.
GM Carter reviewed the additional graphs that Mr. Lang included on Load Duration
Curve, Historical market, HUC Energy pricing and HUC's load profile. These give a
good pictorial of the data being collected even though it is not reported on every
month. HUC has been fairly consistent.
A motion made by Commissioner Martinez, second by Commissioner Cheney to
approve the financial statements. Motion unanimously carried.
5. Open Forum
6. Communication
a. City Administrator — Matt Jaunich
i. Projects being worked on are; Hospital expansion, Woodstone Living, 4th
phase of Highfield Apartments
ii. Street projects; 5th Ave, Uponor Road, Intersection by Cash Wise
b. Divisions
i. Dan Lang, Engineering Services Manager — Absent
ii. Dave Hunstad, Electric Transmission/Distribution Manager — Nothing to
report
iii. Randy Blake, Production Manager —
1. Working and coordinating with contractors
2. Piping to cooling tower is going well.
3. Support steel for exhaust is up.
iv. John Webster, Natural Gas Division Manager — Nothing to report
v. Jared Martig, Financial Manger —Absent
c. Human Resources — Brenda Ewing — Nothing to Report
d. Legal — Marc Sebora — Nothing to Report
e. General Manager — Jeremy Carter
i. Auditors are here.
ii. With Government shutdown, any Federal Utility customers we have, we will
be lenient on payment dates.
iii. Involved with energy committee webinars.
iv. Working on Strategic Planning topics of where HUC should be in the next
5-10 years.
V. Wrapping up year-end.
7. Policies
a. Review Policies
i. Minnesota Government Data Practices Act & Public Records Request
ii. Section 1 of Exempt Handbook
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iii. Section 1 of Non -Exempt Handbook
No Changes recommended at this time.
b. Approve Changes - None
GM Carter noted for reviewal of policies HUC would like to take more of a
systematic approach. The Employee handbooks are made of six sections. Staff
would like to review a section a month; January through June. After June, there
are about 50 customer service polices, which would parcel out to be 10 a month.
If policy changes are needed before scheduled review time, HUC would review
those immediately.
Commission agreed that a systematic approach makes sense.
8. Unfinished Business
9. New Business
a. Approval of 2019 Ford F-250, 4WD Cab and Chassis
Mr. Webster presented Requisition #007803 for a 2019 Ford, F-250, 4WD Cab
and Chassis. In compliance with the 2019 Fleet Management Program the
Natural Gas Division is to replace vehicle #651, a 2006 Ford, F-150 4-wheel drive
pickup. The replacement vehicle that is recommended by HUC is a 2019 Ford
F-250 extended/double cab, 4-wheel drive cab and chassis. A requisition for the
utility body will follow in the coming months.
A motion by Commissioner Cheney, second by Commissioner Wendorff to
Approve 2019 Ford F-250, 4WD Cab and Chassis. Motion carried unanimously.
b. Approval of 2019 Ford F-350, 4WD Cab and Chassis
Mr. Webster presented Requisition #007185 for a 2019 Ford, F-350, 4WD Cab
and Chassis. In compliance with the 2019 Fleet Management Program, the
Natural Gas Division is to replace vehicle #623, a 2008 Ford, F-350 4-wheel drive
cab and utility body with 93,000 miles. The replacement vehicle that is
recommended by HUC is a 2019 Ford F-350 crew cab, 4-wheel drive cab and
chassis. A requisition for the utility body will follow in the coming months.
A motion by Commissioner Cheney, second by Commissioner Martinez to
Approve 2019 Ford F-350, 4WD Cab and Chassis. Motion carried unanimously.
c. Approve Requisition #007814 Replace 2008 Service Truck #573
Mr. Hunstad presented Requisition #007814 to replace the 2008 Service Truck
#573. In compliance with the 2019 Fleet Management Program, the Electric
Division is to replace the 2008 Service Truck #573. The replacement vehicle that
is recommended by HUC is a 2019 Ford F-350 4-wheel drive Super
Cab/Chassis. A requisition for the utility body will follow in the coming months.
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A motion by Commissioner Wendorff, second by Commissioner Cheney to
Approve replacing the 2008 Service Truck #573. Motion carried unanimously.
d. Approve Requisition #007822 for Plant 1 Cooling Tower Upgrade
Mr. Blake presented Requisition #007822 for Plant 1 Cooling Tower Upgrade.
The original Plant 1 cooling tower was built in 1962; in 1978, an east cell was
added. One of the outside walls then became an interior wall. In 2012, HUC
received bids to repair the wood in the fan stack area of the west and center cells.
At that time, the siding was removed by Midwest Towers and replaced with
fiberglass panels. Last summer, the tower developed a leak between the center
and east cell wall. Several contractors that specialize in cooling tower repair
have been contacted. The interior wall that is leaking contains asbestos fibers
in the wall panels. The contractors also stated that the outer walls have the same
asbestos composition and would need to be abated before they could perform
the repairs. This upgrade will require coordinating two contractors at the same
time to perform the opening of the tower and removing the asbestos. This
requisition is for the tower repair to Precision Cooling Towers for $46,485.00.
The low bid for the asbestos abatement came in at $22,450.00 and that
requisition was given to GM Carter for that portion of the project. Total budgeted
project cost was $80,000, with total actual project costs coming in at $68,935.00.
A motion by Commissioner Martinez, second by Commissioner Cheney to
Approve Requisition #007822 for Plant 1 Cooling Tower Upgrade. Motion carried
unanimously.
e. Approve HDR Change Order Request
GM Carter presented the HDR Change Order Request. GM Carter noted that
this is the third change order request. The original contract amount approved
was for $382,110. Since then two change orders have increased the current
contract price to $827,610. HDR is now requesting a third change order in the
amount of $108,400 to complete the project along with the final commissioning
of the new units in June of 2019. The change order is being requested due to
redesign work that was needed along with additional questions and emails that
are being asked from Fagen Inc. Every time there is contact with HDR that leads
to more billable hours. HDR is required to respond to the contractors, this is a
complex project and clarification is needed. When Unit 5 was completed,
different contractors were used and it was only the one unit.
Mr. Blake noted that back when the plant was being built not everything was
documented; Staff did not have GIS. Today, Staff does not know where piping
is located until digging starts. Thus creating redesigns, which also takes more
time and materials. This is also a lot of structure in a small area.
After some discussion, a motion by Commissioner Martinez, second by
Commissioner Wendorff to Approve HDR Change Order Request. Motion
carried unanimously.
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10. Adjourn
There being no further business, a motion by Commissioner Cheney, second by
Commissioner Martinez to adjourn the meeting at 3:52p.m. Motion was
unanimously carried.
ATTEST:, /
Don Martinez, President
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Robert Wendorff, Secr
t/l/