01-26-2022 HUCMMINUTES
Regular Meeting — Hutchinson Utilities Commission
Wednesday, January 26, 2022
Call to order — 3:00 p.m.
Vice President Anthony Hanson, called the meeting to order. Members, present: Vice
President Anthony Hanson; Commissioner Robert Wendorff; Commissioner Kathy
Silvernale; GM Jeremy Carter; Attorney Marc Sebora
Absent: President Matt Chien,ey; Secretary Don Martinez
1 Conflict of Interest
Commissioner Hanson declared conflict of interest in voting on agenda item 2f -
Designate Depositories for Utility Fuinds,, as hie is an Officer and employee of
Citizens Bank & Trust. Commissioner Hanson will be, abstaining from, Agenda item
2f.
2. Commission Reorganization,
Vice President Hanson called for the annual Commission reorganization.
aA motion made by Commissioner Wendoirff, second by Commissioner
SilvernMe to re-elect Matt Cheney to the position of President, Motion carried
unanimously.
b. A motion made by Commissioner Wendorff, sec:onid by Commissioner
Silvernale to re, -elect Anthony Hanson to the position of Vice President.
Motion carried unanimously,
c. A motion made, by Commissioner Wendorff , second by Commissioner
Sil�vernale to ire -elect Don Martinez to the position of Secretary. Motion carried
unianimously.
d. A motion made by Commissioner Silvernale, second by Cooner
Wendorff to appoint Marc Sebora as legial counsel,. Motion carried
unanimously.
e. A motion made by Commissioner Silvernale, second by Commissioner
Wendorff to appoint Angle; Radke as recording secretary. Motion carried
unanimously.
fA miotion made by Commissioner Wendorff, second by Commissioner
SiNerniale to degniate Citizens Bank & Trust, Wells Fargo Bank, Wells, Fargo
Adivis,ors, Home State Bank, Morgan Stanley and Cetera lnveistment Services
as depositories for utility funds. Vice President Hanson abstained. Mr.
Sebora asked all in favor, Motion carried ously,
3. Approve Coda
a. Approve Minutes
b. Ratify Payment of Bills
the Consent Agenda., Motion carried unanimously.
4. Approve Financial Statements
Mr. Martig presented the Financial Statements. Cash decreased in large part due
to the solar array and transformer at Plant 2 projects as well as covering $1.2M of
the February commodity spike. Electric Division Net Loss increased by $3.6M with
decreased revenues due to MRES refund and transformer insurance proceeds in
2020 along with December 2020 Depreciation due to software change. YTD budget
to actual variance for depreciation was due to budgeting for 6 months of depreciation
on the new engines but actually depreciating them over the full 12 months. Mr. Martig
reviewed GASB entries that will need to be made coming up.
GM Carter reviewed budget to actual for the year. Consumption came in close to
what was budgeted for Natural Gas and Electric Divisions; overall tracking well.
Comparing the classes, All Electric came in lower due to this Fall being warmer than
last Fall. Generator fuels were up due to much higher generation in 2021 which
coincides with higher Sales for Resale. GM Carter reviewed generated MWH used
for the Market and for HUC's hedging program.
GM Carter spoke of the Natural Gas Customer Revenue and Purchased Gas in
relation to the Polar Vortex in February. Target was to hit 37% of Gross Margin, in
reality it was only 33%, Sept and October were soft months in consumption due to
warmer weather.
Motion by Commissioner Silvemale, second by Commissioner Wendorff to approve
the financial statements. Motion carried unanimously.
5. Open Forum
6. Communication
a. City Administrator — Matthew Jaunich —
i. Welcomed Kathy Silvemale as new Commissioner
ii. Accepted bids for street project West of the Rec Center
iii. Nuvera will be doing a large fiber project this Summer
b. Divisions
i. Dan Lang, Engineering Services Manager — Nothing to report
ii. Dave Hunstad, Electric Transmission/Distribution Manager-
1. Reviewed Solar Array Graph, which shows production from last 2
months
President Matt Cheney entered at 3:20p.m.
iii. Mike Gabrielson, Production Manager —
1. Finished up last half of 2021 Emission documents for Plants 1 & 2 and
have sent off to the State
2. Working on exhaust stack testing for Plants 1 & 2
iv. John Webster, Natural Gas Division Director — Nothing to report
v. Jared Martig, Financial Manager-
1. Had to put a capital lease on the land of the Solar Array, which will be
recorded as an Asset; As HUC pays the City, the book value will be
decreased.
2. Next year new GASB on Leases will need to be implemented which will
include printer and mailing machine.
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3. Auditors are here this week
c. Human Resources — Angie Radke -
i. Working on OSHA Logs that will be completed by end of month
ii. Maintenance Mechanic 11 interviews • start next week
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iii. Please note Agenda item gb-shouId state Requisition #009011 and not
#009001
d. Legal — Marc Sebora —
i. Welcomed new Commissioner Kathy Silivernale who was officially sworn in
last Friday, Jan 21,
e. General Manager —Jeremy Carter
i. Business updates were sent out last week.
ii. Federal level update was sent out yesterday.
iii. Last Special meeting Commissioner Hanson inquired about providing a
background on Engine Inventory, plan moving forward and what is looking
to be retired; this information was just sent out, please review and feel free
to follow-up with any questions.
iv. IVIMUA Legislative Rallly will be held virtually on Feb 8 & 9. Federal Rally is
also coming up in Feb, currently is in person but may look to have virtual
options.
v. MMGA has a board meeting tomorrow to finalize prepaid deal and will look
to go to market in next couple of days. Looking at having a Bond issuance
not to exceed $850M, this will also be a 30-year prepaid Deal.
7. Policies
a. Review Policies
i. Section I of Exempt Handbook
ii. Section Il of Nlon-Exempt Handbook
No changes recommended at this time.
8. Unfinished Business
9. New Business
a. 3M Transformer LTC Repair
Mr. Hunstad presented Approval of 3M LTC Repair. HUC preforms oil testing on
substation transformers every 6 months, the last couple tests for 3M have shown
some high Basing in the LTC. The Initial quote was $9K, however when CE
Power was hired to perform the required maintenance it turned out to needing
additional parts and labor. Attached are the labor and materials that was
required.
Motion by Commissioner Hanson, second by Commissioner Wendorff to Approve
3MI LTC Repair PO 8955. Motion carried unanimously.
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b. Approve Requisition #009011 — Plant #1 Substation RTU and Relays
Mr. Lang presented Approval of Requisition #009011 — Plant #1 Substation RTU
and Relays. Looking at replacing the existing 40-year old electro-mechanical
relaying equipment at Plant 1 this year. DGR Engineering will be used to design
the protection system scheme for the substation and feeders, specify materials,
develop relay settings, and commission the relays. DGR Engineering will also
design and specify the materials to replace the obsolete Ilex RTU and integrate
with the new relaying equipment.
Motion by Commissioner Hanson, second by Commissioner Silvemale to
Approve Requisition #009011 — Plant #1 Substation RTU and Relays. Motion
carried unanimously.
c. Approve Advertisement for Bid: In -Line Inspection of 12" Lateral Natural Gas
Pipeline
Mr. Webster presented Approval of Advertisement for Bid: In -Line Inspection of
12" Lateral Natural Gas Pipeline. Due to the discovery of a high consequence
area found in the Industrial Park this past year, HUC now needs to complete a
baseline study within the year of the finding. A contractor will need to be hired to
perform the inline pigging project.
A motion by Commissioner Hanson, second by Commissioner Wendorff to
Approve Advertisement for Bid: In -Line Inspection of 12" Lateral Natural Gas
Pipeline. Motion carried unanimously.
d. Approve Memorandum of Agreement Health Care Savings Plan Union
contract (IBEW Local 949) dated January 1,2022 — December 31,2023
GM Carter presented Approval of Memorandum of Agreement Health Care
Savings Plan Union Contract (IBEW Local 949) dated January 1,2022 -
December 31, 2023. Back in December when the Board approved the Union
Contract, this portion had not been officially approved by the State. Since that
time, it has now been approved by the State and Staff is looking to have the
Board take formal action and Approve the Memorandum.
A motion by Commissioner Silvemale, second by Commissioner Wendorff to
Approve Memorandum of Agreement Health Care Savings Plan Union Contract
(IBEW Local 949) dated January 1,2022 — December 31,2023. Motion carried
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uinanimously.
10., Adjourn
There being no further business, a motion by Commissioner Wendorff, !second by
Commissioner Silvernale to adjourn the meeting at 3:34pm. Motion carriied
unanimously.
ATTEST:
Matt Cheney, President
R
bon MartinWz—, §e—c—retary