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Home My WebLink About12-17-2025 HUCMMINUTES Regular Meeting — Hutchinson Utilities Commission Wednesday, December 17, 2025 Call to order — 3:00 p.m. President Matt Cheney called the meeting to order. Members present: President Matt Cheney; Secretary Don Martinez; Commissioner Kathy Silvernale; Commissioner Tom Lambert; GM Jeremy Carter; Attorney Marc Sebora: Absent: Vice President Troy Pullis; 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 Operating expenses increased due to Solar Array Repairs of $14K, MPCA Fees of $11 K and Unit 7 Repairs of $32K. Natural Gas Division Operating expenses also show an increase due to CIS Survey of $30K, Risk Assessment of $6K and Heartland Corn Materials of $14K. GM Carter reviewed wholesale costs, hedging and spot market pricing along with the Cash Balance. Motion by Commissioner Silvernale, second by Commissioner Lambert to Approve the Financial Statements. Motion carried unanimously,. 4. Open Forum 5. Communication a. City Administrator — Matthew Jaunich — i. Getting ready for next year on Street projects ii. Busy year coming up on Construction b. Divisions i. Dan Lang, Engineering Services Manager — 1. Hutch Substation Update ii. Dave Hunstad, Electric Transmission/Distribution Manager — Absent iii. Mike Gabrielson, Production Manager — 1. Continuing to work with GE regarding Unit 1 2. Working on water leak at Plant 1 cooling tower iv. Jared Martig, Financial Manager — Nothing to Report v. Byron Bettenhausen, Natural Gas Manager —Absent c. Human Resources — Angie Radke - i. Working on Year End items ii. Pay Equity Report will be in Jan Packet d. Legal — Marc Sebora — i. Nothing to report e. General Manager — Jeremy Carter — Nothing to report 6. Policies a. Review Policies No changes recommended at this time 7. Unfinished Business 8. New Business a. Approve 2026 Non -Union Pay Grid Adjustment GM Carter presented Approval of 2026 Non -Union Pay Grid Adjustment. GM Carter reviewed the statistical findings along with stating that the pay grid customarily matches the Union contract that has been put in place. Motion by Commissioner Martinez, second by Commissioner Silvernale to Approve 2026 Non -Union Pay Grid Adjustment. Motion carried unanimously. b. Approve 2026 Electric and Natural Gas Operating Budgets & 5 Year CIP GM Carter presented Approval of 2026 Electric and Natural Gas Operating Budgets and 5 Year CIP. At the November 26, 2025, Budget Commission meeting, a high-level overview of the 2026 budgets were reviewed and discussed in detail. Since that time, there have been four amendments to the preliminary budget that include: 1) Suspension of using Rate Stabilization Funds in 2026 in the electric division, 2) Suspension of providing Fuel Cost Adjustment credits in the natural gas division, 3) Adding $44K for a Cost of Service Study in 2026 and, 4) Adding $10K for the Compensation Study. The current budget reflects a 4% grid shift for non -union employees and a general wage adjustment of 4% for union members. Motion by Commissioner Lambert, second by Commissioner Silvernale to Approve 2026 Electric and Natural Gas Operating Budgets and CIP. Motion r. carried unanimously. c. Approve Cost of Service & Rate Design Study with UFS GM Carter presented Approval of Cost of Service & Rate Design Study with UFS. HUC has identified that performing a COS study every 5 years is critical to ensure adequate revenue requirements are met to conduct HUC business in a proper fashion. If circumstances warrant a COS study be completed earlier than every 5 years a recommendation would be brought to the commission for consideration. The last COS study was conducted in 2022 using 2021 & 2022 financial and operation information as part of the test data. The COS study proposal is to use the consulting firm UFS, which has been used in the last several studies for HUC. The proposal amount has been added to the 2026 budget. Motion by Commissioner Silvernale, second by Commissioner Lambert to Approve Cost of Service & Rate Design Study with UFS. Motion carried unanimously. d. Approve Commercial Solar Agreement with Cedar Creek Energy e. Approve Solar PV Agreement with Apadana Energy f. Approve Solar PV Agreement Ziegler Energy Solution g. Approve Solar PV Agreement with Apadana Energy h. Approve Solar PV Agreement Ziegler Energy Solutions GM Carter presented Agenda items 8d-8h together. Back on September 28, 2025, HUC entered into an agreement with Energy Management Solutions to help with the application process for Solar on Public Buildings Grant Program. The State will reimburse 70% of the total costs and 30% will be reimbursed by the Federal Government. HUC is still in the review process with the State, and the next step is to have an agreement signed with the solar developer. The agreement is contingent on being awarded the Grant for the project. Once the Grant is awarded, HUC will need to send a 10% down payment by December 31, 2025, to initiate the project. GM Carter reviewed the buildings for each agenda item. Item 8d is for the Main Office Building, Item 8e is for the Inventory Building, Item 8f is for Plant 1, Item 8g is for the Cold Storage Building, and 8h is for Plant 2. Discussion was on held on the size and cost for each building, total savings amount, cost to HUC if Federal grant money is not received and why multiple vendors are being used. HUC received a letter from the State on December 15, 2025, stating the 70% will 3 be awarded. Motion by Commissioner Martinez, second by Commissioner Lambert to Approve items 8d-8h. Motion carried unanimously. i. Approve Plant #2 Substation Load Study with DGR. Mr. Lang presented Approval of Plant #2 Substation Load Study with DGR. HUC staff is recommending to enter into an agreement (Task Order #11) with DGR Engineering to study the anticipated 20MW load to be added to the Plant #2 Substation. DGR will review HUC's design as well as the relay settings presently in place at the 3M and Plant #2 Substations to ensure proper operation with the additional load. Motion by Commissioner Silvernale, second by Commissioner Martinez to Approve Plant #2 Substation Load Study with DGR. Motion carried unanimously. j. Approve Plant #1 Substation 69-115kV Conversion Task Order #9= Amendment #1 with DRG. Mr. Lang presented Approval of Plant #1 Substation 69-115kV Conversion Task Order #9 — Amendment #1 with DGR. In February of 2025 HUC entered into an agreement (Task Order #9) with DGR Engineering to evaluate the Plant #1 Substation 69 to 11 RV conversion as part of the Willmar Line 11 RV rebuild project and develop the preliminary substation design and cost estimate. Amendment #1 will direct DGR to begin the process of developing a transformer specification which will be used for bid solicitation. Motion by Commissioner Martinez, second by Commissioner Silvernale to Approve Plant #1 Substation 69-115kV Conversion Task Order #9 — Amendment #1 with DGR. Motion carried unanimously. k. Approve Paid Family Medical Leave (PFML) Policy Ms. Radke presented Approval of Paid Family Medical Leave (PFML) Policy. HUC is looking to implement a new Organizational Policy to both the Union and Non -Union Policy Handbooks. The Organizational Policy addresses the new MN state requirements that go into effect on 1/1/2026 as it pertains to MN Paid Leave (MNPL). HUC was approved by the State to go with an Approved Private Insurance Carrier at a rate of .423 vs the State's .88 rate. The PFML rate of .423 4 will be split 50/50 between ER and EE. Motion by Commissioner Lambert, second by Commissioner Silvernale to Approve Paid Family Medical Leave (PFML) Policy. Motion carried unanimously. President Cheney added item 8m. m. Approve Customes Power of Attorney Mr. Martig presented Approval of Customes Power of Attorney. In August, HUC placed an order for actuators from GenSys in Germany. The actuators were to be delivered to HUC but ended up weighing too much and have been stuck at the airport in customs for the past month. After conversations, HUC discovered that a Customs Broker is needed in order to have the actuators released. Pro Commerce International Logistics is the sister company of Saia LTL Freight who Staff has been working with. The process requires a power of attorney to be signed for Pro Commerce International Logistics to conduct customs business on HUC's behalf. Best estimated price is $250 for custom broker, $125 for warehouse fees and $150 for shipping. HUC is not sure if any tariffs will be applicable. Motion by Commissioner Lambert, second by Commissioner Martinez to Approve Customes Power of Attorney. Motion carried unanimously. I. Conduct the Performance Review of Hutchinson Utilities Commission General Manager Pursuant to Minnesota Statute 13D.05 Subd. 3(a) President Cheney introduced the agenda item, the General Manager's annual performance review. President Cheney advised GM Carter that he has the option to have the performance review conducted as either an open session or a closed session of the Utility Commission. GM Carter indicated his decision to have the review as part of a closed session. President Cheney entertained a motion to go into closed session to conduct the twelve-month (annual) performance review as permitted under Minnesota Statute 13D.05, Subdivision 3(a). Motion by Commissioner Lambert, second by Commissioner Martinez to go into closed session to conduct the General Manager's performance review. The motion passed unanimously. The Commission then proceeded into a closed session at 3:39 p.m. 5 Hutchinson Utilities Commission Summary of Closed Meeting Proceedings General Manager Performance Appraisal Wednesday, December 17, 2025 On December 17, 2025, the Hutchinson Utilities Commission conducted a closed meeting for the annual performance appraisal for General Manager, Jeremy Carter. Individuals present included General Manager Jeremy Carter, Commission Members Matt Cheney, Don Martinez, Kathy Silvernale, and Tom Lambert, Attorney Marc Sebora, and Administrative/HR Coordinator Angie Radke. Mr. Carter exercised his right to close the proceedings to the public as permitted under Minnesota Statute 13D.05, Subdivision 3(a). Motion by Lambert, second by Martinez to go into closed session to conduct the General Manager's performance review. The motion passed unanimously. The Commission then proceeded into a closed session at 3:39 p.m. The Commission reviewed Mr. Carter's performance for the current calendar year. The review is required per the terms of the employment contract in place between the Hutchinson Utilities Commission and General Manager Carter. Mr. Carter's performance was evaluated in the following areas: Organizational Management, Fiscal/Business Management, Program Development, Relationship & Communication with the Commission, Long -Range Planning, Relationships with Public & Outside Organizations and Overall Performance Ranking. The consensus of the Commission is that Mr. Carter's cumulative performance for the review period was found to be 4.03 on the rating scale of 0 — 5, and per the Hutchinson Utilities Commission, is outstanding on the ratings scale. The employment contract between Hutchinson Utilities and Mr. Carter indicates that salary increases for the General Manager are subject to the provisions of the Compensation Plan section of the Hutchinson Utilities Commission Exempt Employee Handbook. Motion by Silvernale, second by Lambert to close the closed session. The motion passed unanimously. The Commission moved back into open session at 4:30 p.m. Motion by Lambert, second by Martinez to approve a 5% salary increase according to the compiled results of the GM Review. The motion carried unanimously. Motion to adjourn by Lambert, second by Silvernale. The motion carried unanimously, and the meeting adjourned at 4:31 p.m. Don Martinez, Secrete , ATTEST:. w� Matt Cheney, President 0