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09-24-2025 HUCMMINUTES Regular Meeting — Hutchinson Utilities Commission Wednesday, September 24, 2025 Call to order — 3:00 p.m. President Matt Cheney called the meeting to order. Members present: President Matt Cheney; Secretary Don Martinez; Vice President Troy Pullis; Commissioner Kathy Silvernale; Commissioner Tom Lambert; GM Jeremy Carter; Attorney Marc Sebora: 1. Conflict of Interest 2. Approve Consent Agenda a. Approve Minutes b. Ratify Payment of Bills Motion by Commissioner Martinez second by Commissioner Lambert to Approve the Consent Agenda. Motion carried unanimously. 3. Approve Financial Statements Mr. Martig presented the Financial Statements. Electric Division net loss increased by $76k over August 2024. Usage was down 6.84% in part due to timing difference in August billing days year over year for the industrial customer. Sales for Resales were up $726k due to a large increase in generation sales into the market. Large generation is also reason for the $230k increase in generator fuels and chemicals. Natural Gas Division is similar to past year. August Net Income decreased by $82k. Operating Expenses were up due to some regulatory and legal expenses as well as some reimbursable expenses for Fairfax and Heartland Corn. GM Carter noted the swing in the power cost adjustment year over year. All is tracking well on the Retail side. GM Carter also reviewed market sales, wholesale rates and time of use rates. Motion by Commissioner Silvernale, second by Commissioner Pullis to Approve the Financial Statements. Motion carried unanimously. 4. Open Forum S. Communication a. City Administrator — Matthew Jaunich — i. Construction of the downtown apartment complex to start in October ii. Conditional Use Permit on Data Center was approved iii. Working with Dave on Solar for public buildings iv. Potentially 3-4 housing developments coming in next 1-2 years b. Divisions i. Dan Lang, Engineering Services Manager — 1. Construction at the Hutch Sub update ii. Dave Hunstad, Electric Transmission/Distribution Manager — Nothing to Report iii. Mike Gabrielson, Production Manager — Nothing to Report iv. Jared Martig, Financial Manager — Nothing to Report v. Byron Bettenhausen, Natural Gas Manager — 1. River Crossing Project is completed, thank you to Staff and residents. 2. DRS 3 completed 3. Final stretch of construction season c. Human Resources —Angie Radke - i. Will be meeting with Insurance Broker on PFML percentage rates ii. Benefits right around the corner, finalizing percentage increase iii. Open House Oct 7 from 4-7pm d. Legal — Marc Sebora — i. Nothing to report e. General Manager — Jeremy Carter i. Working on Cash Flow and what might push into 2026 ii. Natural Gas prepaid contracts update iii. Working on Budgets and CIP iv. New Ulm Contract Update v. Data Center update 6. Policies a. Review Policies i. Electric Service Requirements and Changes ii. Temporary Service iii. Temporary Service in Case of Underground Failure iv. Electric Meter Placement v. Sealing of Meters vi. Meter Testing vii. Right -of -Way Clearing viii. Tree Removal or Trimming ix. Locating Customer's Underground Utilities No changes recommended at this time b. Approve Changes i. Security Light Rental — Rate to Furnish and Maintain Fixture ii. Rate Schedule — Electric iii. Rate Schedule — Natural Gas Ms. Radke spoke of the policy changes to match what was approved by the City Council and Commission in 2023. GM Carter reviewed the last Cost of Service Study and how it relates to the Rate Schedule movements. GM Carter also noted that a new Cost of Service Study will need to be completed in 2027. 2 Motion by Commissioner Martinez, second by Commissioner Silvernale to Approve Policy Changes. Motion carried unanimously. 7. Unfinished Business 8. New Business a. Approve Amendment to HCP's Firm Transportation Agreement GM Carter presented Approval of Amendment to HCP's Firm Transportation Agreement. HUC entered into a Natural Gas Firm Transportation Capacity Agreement with Heartland Corn Products (HCP) on November 1, 2023 to provide firm transportation capacity in the amount of 12,300 Dth/day. Along with the Firm Transportation Agreement, HCP also entered into a Firm Capacity Reservation Agreement on December 20, 2023 to earmark an additional 4,700 Dth/day of capacity to account for future growth and natural gas needs in the operations of HCP. At this time, HCP is requesting to convert 400 Dth/day from the reservation agreement to the firm transportation agreement in addition to extending the reservation agreement an additional 2 years. The amendment will bring the firm transportation agreement to 12,700 Dth/day of firm capacity on the pipeline. Motion by Commissioner Pullis, second by Commissioner Lambert to Approve Amendment to HCP's Firm Transportation Agreement. Motion carried unanimously. b. Approve Amendment to HCP's Reservation Agreement GM Carter presented Approval of Amendment to HCP's Reservation Agreement. At this time, HCP is requesting to convert 400 Dth/day from the reservation agreement to the firm transportation agreement in addition to extending the reservation agreement an additional 2 years. The amendment will bring the reservation agreement down from 4,700 Dth/day to 4,300 Dth/day. Motion by Commissioner Silvernale, second by Commissioner Martinez to Approve Amendment to HCP's Reservation Agreement. Motion carried unanimously. c. Approve Memorandum of Agreement Relative to PFML Ms. Radke presented Approval of Memorandum of Agreement Relative to PFML. HUC agreement for IBEW #949 dated January 1, 2024-December 31,2026 had a provision to Article XX — Health and Disability Insurance to have both parties agree to a re -opener on or before June 1, 2025, to meet and negotiate specifically regarding contributions toward the Paid Family Medical Leave (PFML) premium. Since that time, both parties agreed effective January 1, 2026, the employer and employee will split the premiums for the Minnesota PFML or alternative private plan ® 3 on a 50/50 basis, with the employee share payable through payroll deductions pursuant to Minn. Stat. 268B.14. Employees may utilize accrued paid sick leave to supplement PFML not to exceed 100% of the regular wage of the employee. In the event sick leave is exhausted, employees may utilize other accrued paid leave to supplement PFML not to exceed 100% of the regular wage of the employee. Motion by Commissioner Martinez, second by Commissioner Pullis to Approve Memorandum of Agreement Relative to PFML. Motion carried unanimously. d. Approve Large Power Customer Tariff GM Carter presented Approval of Power Purchase Agreement and Credit & Security Agreement. Staff is requesting the Board to consider adding a Large Power Customer Tariff to HUC's current rate classes. The new classification would allow future high load interruptible customers the ability to entertain services from HUC under the classification provided the requirements are met. GM Carter reviewed the factors that differentiate the Large Power Tariff from other rate classes, which include; Load Factor must be a minimum of 90%, Electric service must be interruptible, Minimum load must be 5 MW's, Customer must enter into a Power Purchase Agreement with HUC, Customers will be expected to cover upfront costs of infrastructure needed to service the load and, Customers will be expected to enter into a security & collateral agreement to limit HUC's exposure to the power supply costs. Discussion was held on types of business that would fall into this class and if changes to the rates can be made. Motion by Commissioner Pullis, second by Commissioner Silvernale to Approve Large Power Customer Tariff. Motion carried unanimously. e. Approve Power Purchase Agreement and Credit & Security Agreement GM Carter presented Approval of Power Purchase Agreement and Credit & Security Agreement. Upon approval of the agreements, the customer will be finalizing the purchase of the land and site plans with the City of Hutchinson. HUC and the customer will finalize the specifications and ordering of the equipment needed to service the future load. It is anticipated the load will come on line in the later half of 2026 barring any set backs on constructing the building and receiving the necessary equipment. GM Carter highlighted the articles in the Power Purchase Agreement. The term of the Power Purchase Agreement is a 5-year commitment. GM Carter also reviewed the Credit & Security Agreement, which is a stand-alone agreement from the Power Purchase Agreement. Discussion was held on the agreements and the provisions that are in the 4 agreements. Motion by Commissioner Pullis, second by Commissioner Lambert to Approve Power Purchase Agreement and Credit & Security Agreement. Motion carried unanimously. 9. Adjourn There being no further business, a motion by Commissioner Lambert, second by Commissioner Pullis to adjourn the meeting at 3:44pm. Motion carried unanimously, Don Martinez, Secret'' ATTEST:��e att Cheney, President 5