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HomeMy WebLinkAbout5-27-2026 HUCCPHUTCHINSON UTILITIES COMMISSION AGENDA REGULAR MEETING May 27, 2026 3:00 p.m. 1. CONFLICT OF INTEREST 2. APPROVE CONSENT AGENDA a. Approve Minutes b. Ratify Payment of Bills 3. APPROVE FINANCIAL STATEMENTS 4. OPEN FORUM 5. COMMUNICATION a. City Administrator b. Divisions C. Human Resources d. Legal e. General Manager 6. POLICIES a. Review Policies i. Section 5 of Exempt Handbook ii. Section 5 of Non -Exempt Handbook b. Approve Changes 7. UNFINISHED BUSINESS 8. NEW BUSINESS a. Approve Natural Gas Custody Transfer Agreement with 3M b. Approve Natural Gas Maintenance Agreement with City of Fairfax C. Approve Amendment #2 to the Heartland Corn Reservation Agreement d. Approve Amendment #2 to the Heartland Corn Firm Transportation Agreement 9. ADJOURN MINUTES Regular Meeting — Hutchinson Utilities Commission Wednesday, April 29, 2026 Call to order — 3:00 p.m. President Don Martinez called the meeting to order. Members present: President Don Martinez; Secretary Matt Cheney; Vice President Tom Lambert; Commissioner Kathy Silvernale; Commissioner Jeremy Crosby; 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 Cheney, 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 $129k over March 2025. Revenues and usage were up but offset by an increase in purchased power, transmission and operating costs. Increase in operating costs included new cylinder heads that were taken out of inventory for Units 6 & 7. PCA brought in an addition $159k for the month of March, there was no PCA for March 2025. Natural Gas Division similar from last year. GM Carter highlighted Electric and Gas customer revenue is increased from last year which relates to the power cost and fuel cost mechanisms. GM Carter reviewed wholesale rates and transmission costs. Large General is carrying classes. Cash and investments were also reviewed. Motion by Commissioner Silvernale, second by Commissioner Crosby to Approve the Financial Statements. Motion carried unanimously. 4. Open Forum 5. Communication a. City Administrator— Matthew Jaunich —Absent b. Divisions i. Dan Lang, Engineering Services Manager — Nothing to Report ii. Dave Hunstad, Electric Transmission/Distribution Manager 1. Construction has started up 2. Inverter on solar field was replaced, which was under warranty 3. Transformer was removed from the hotel building being torn down on Main St. 4. Solar Grant program - Update iii. Mike Gabrielson, Production Manager 1 1. GE will be onsite the week of May 11 to remove Unit 1 2. Plant 1 cooling tower pipe leak update iv. Byron Bettenhausen, Natural Gas Manager - Absent v. Jared Martig, Financial Manager — 1. Talking with insurance on Plant 1 cooling tower pipe leak c. Human Resources — Angie Radke - i. Compensation Study Update ii. Welder position has been posted d. Legal — Marc Sebora — i. Nothing to report e. General Manager — Jeremy Carter i. Gave update for Byron on projects coming up, MNOPS Audit the week of May 18t" and Fairfax Operating Agreement. ii. Continuing to work on cooling tower project, reviewing bid documents and gathering information iii. COS Study update -working through modeling 6. Policies a. Review Policies i. Section 4 of Exempt Handbook ii. Section 4 of Non -Exempt Handbook No changes recommended at this time. 7. Unfinished Business 8. New Business a. Approval of Highland Park Industrial, LLC Natural Gas Transportation and Commodity Purchase Agreement GM Carter presented Approval of Highland Park Industrial, LLC Natural Gas Transportation and Commodity Purchase Agreement. Highland Park currently transports base load and daily swing supplies of natural gas on HUC's transmission and distribution systems. The current agreement in place expires May 1, 2026. GM Carter reviewed the amended changes to the new agreement which include 1) New contract will run for 10 months vs 12 months, which will place both retail transport customers on the same contract cycle for ease of administration, 2) All prepay language pertaining to a 4 cent discount on half the base -load has been removed as the agreement is no longer in place, and 3) The meter price has changed to reflect the last rate increase approved by the commission. Motion by Commissioner Lambert, second by Commissioner Cheney to Approve 2 Highland Park Industrial, LLC Natural Gas Transportation and Commodity Purchase Capacity Agreement. Motion carried unanimously. b. Approval of 1st Amendments to UFC's Transportation and Commodity Agreements GM Carter presented Approval of 1st Amendments to UFC's Transportation and Commodity Agreements. There are two agreements in place with United Farmers Co-op (UFC), which include the transportation agreement and commodity agreement, and both expire on 10/31/2033. During the duration of the existing contracts, UFC merged with Central Region Cooperative to form Central United Cooperative. As a result of the merger, Central United Cooperative is assigned the rights and obligations under the existing contracts. The 1st amendments to both agreements reflect the amended changes to the agreements and acknowledge the obligations placed upon the newly formed organization. Motion by Commissioner Lambert, second by Commissioner Crosby to Approve 1st Amendments to UFC's Transportation and Commodity Agreements. Motion carried unanimously. c. Approval of 1 Year Extension on Current UNG Transportation Contract GM Carter presented Approval of 1 Year Extension on Current UNG Transportation Contract. HUC has a transportation agreement in place with United Natural Gas (UNG), which the current contract expires on May 31, 2026. UNG is currently in the process of selling its natural gas -related infrastructure. In lieu of renewing a new long-term agreement, per section 3 in the existing agreement, UNG is requesting a 1-year extension of the current agreement until the acquisition is complete. Upon final acquisition of the natural gas assets, new contracts will be put in place with the new buyers of the infrastructure. Motion by Commissioner Silvernale, second by Commissioner Cheney to Approve 1 Year Extension on Current UNG Transportation Contract. Motion carried unanimously. d. Approval of Fairfax Interconnect Agreement GM Carter presented Approval of Fairfax Interconnect Agreement. This agreement has been in place for years, however it was in New Ulm's name since New Ulm was the main agency for Fairfax when the interconnect stations were put in place after HUC built the pipeline. New Ulm has been taken care of New 3 Ulm's Interconnect station and Fairfax's Interconnect station. New Ulm reached out and would like HUC to have a separate agreement with Fairfax. The interconnect agreement establishes the commodity custody transfer point and the interconnection point between Hutchinson's natural gas pipeline facilities and Fairfax's natural gas pipeline facilities. The agreement also spells out the equipment necessary at the interconnection station to transport and read the flow of natural gas at predetermined pressures. Motion by Commissioner Cheney, second by Commissioner Lambert to Approve the Fairfax Interconnect Agreement. Motion carried unanimously. e. Approval of Sterling Energy LLC Contract 1st Amendment. Mr. Gabrielson presented Approval of Sterling Energy LLC Contract 1st Amendment. The amendment states Sterling Energy agrees to remove Units 3, 4 and 8 from HUC's facility no later than December 31st, 2026. Any generating set and auxiliary equipment still left on the premise as of December 31st, 2026 will resort back in rights, title and possession to HUC. Motion by Commissioner Lambert, second by Commissioner Crosby to Approve Sterling Energy LLC Contract 1st Amendment. Motion carried unanimously. f. Review of 2025 Annual Benchmarking Report Mr. Hunstad presented the 2025 Annual Benchmarking Report. The report this year includes HUC's data in comparison to 121 utilities in the region. The report focuses on distribution system reliability across the country and is customized to each utility that participates in the APPA TRX Reliability. Mr. Hunstad reviewed the SAIDI, SAIFI, and CAIDI Summary along with where HUC ranks to others in the region. Commissioners thanked and congratulated Staff for the hard work. g. Review of 2025 Safety Award of Excellence Mr. Hunstad presented the 2025 Safety Award of Excellence. HUC has earned the Diamond (Top) designation of the American Public Power Association Safety Award of Excellence for safe operating practices in 2025. h. Award Contract for Plant #1 Substation 47MVA Transformer Mr. Lang presented Awarding Contract for Plant #1 Substation 47MVA 12 Transformer. On April 15t", HUC held a bid opening for a 115/13.8kV 47MVA transformer for the Plant #1 Substation 115kV rebuild project. Four bids were received, of the 4 bids, the lowest bid was disqualified for not providing a performance bond in the amount of 100%, which is required. Staff and DGR Engineering are recommending awarding the contract to Hitachi Energy. If approved, Staff will look into entering into a contract with Hitachi Energy once all documents have been reviewed. Motion by Commissioner Silvernale, second by Commissioner Lambert to Award Contract for Plant #1 Substation 47MVA Transformer. Motion carried unanimously. 9. Adjourn There being no further business, a motion by Commissioner Lambert, second by Commissioner Crosby to adjourn the meeting at 3:38p.m. Motion carried unanimously. ATTEST: Don Martinez, President 5 Matt Cheney, Secretary Special Meeting Minutes Special Meeting — Hutchinson Utilities Commission Tuesday, May 19, 2026 Call to order — 7:30 a.m. President Don Martinez called the meeting to order. Members present: President Don Martinez; Secretary Matt Cheney; Vice President Tom Lambert; GM Jeremy Carter Others Present: Mayor Gary Forcier; Byron Bettenhausen; and Angie Radke Absent: Commissioner Kathy Silvernale The purpose of the special meeting is to Approve the Crow River Parallel Project. Mr. Bettenhausen thanked the Commissioners for coming in and presented Approval of the Crow River Parallel Project. Three proposals were received to directional bore and install approximately 6700' of 6" HDPE. The work was quoted based on the map provided that shows the work starting at highway 15 on the Southwest corner of Plant 1 property, extending to the West and ending at AFS park and tying into the line installed last year crossing the Crow River. HUC will be purchasing all the materials for the project. Approximate start date will be August V, 2026. Conversation was held on DRS pressure and the depth of the piping. Motion by Commission Cheney, second by Commissioner Lambert to Approve the Crow River Parallel Project, Req#10586. Motion carried unanimously. Adjourn There being no further business, a motion by Commissioner Lambert, second by Commissioner Cheney to adjourn the meeting at 7:36a.m. Motion carried unanimously. 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U U H U .� a \ C7 Qa a) H rt a s s J-) W G H 0 C W +) 3 W G 4-1 H � r1 J-) a CD rt x w x a .H x (00 x w LH a a) O N (0Q u 0 0 a a U 04 U 0 0 Q H H z a x m 0 a w Q w w Q W a z H Q H � x a H z 0 0 W H x H U W U H n U H w x x U H Z W w n Q a a a z H a w 0 0 0 a 0 0 a a w x a a a' 0 0 W H Q D4 a Q H z o Q Q W W H C7 H Q Qz W H N � (0 a w � x E z H w 0 �� w w a a n U) �D �D 5 H H H zH- N N co co Q Q U f` O N J' LO O H N LO LO LO LO �o �-o �-o LO LO LO LO LO LO LO LO U U U oo oo oo oo oo oo oo oo x x U U rn tl co co .. � � W C7 W C7 W C7 W C7 W C7 W C7 W C7 W C7 W W E-i E-i H Z:7) O FC FC H -ri u) J-) r U U H H l0 i-1 rl N , l) a' C7 l0 N l0 N l0 N l0 N l0 N l0 N l0 N l0 N Q Q z z O,' U u h Q N O O O O O O O O N H H \ \ \ \ \ \ \ \ O •• x N N N N N N N N N a) un u) ( -(', U �5 Ln Ln Ln Ln Ln Ln Ln Ln O ,D Q Cia O O O O O O O O HUTCHINSON UTILITIES COMMISSION COMBINED DIVISIONS FINANCIAL REPORT FOR APRIL, 2026 Combined Division Customer Revenue Sales for Resale NG Transportation Electric Division Transfer Other Revenues Interest Income TOTAL REVENUES Salaries & Benefits Purchased Commodities Transmission Generator Fuel/Chem. Depreciation Transfers (Elect./City) Operating Expense Debt Interest TOTAL EXPENSES NET PROFIT/(LOSS) 33.3% of Year Comp. 2026 2025 Di %Chna 2026 2025 Di %Chna Full Yr Bud %of Bud $ 2,963,233 $ 2,707,820 $ 255,413 $ 315,916 $ 713,426 $ (397,510) $ 177,910 $ 168,307 $ 9,604 $ 60,667 $ 60,639 $ 28 $ 75,970 $ 45,839 $ 30,131 $ 47,793 $ 64,375 $ (16,582) $ 3,641,489 $ 3,760,405 $ (118,917) 9.4% $ 15,076,653 $ 13,128,102 $ 1,948,551 14.8% $ 40,209,447 37.5% (55.7%) $ 1,432,860 $ 1,615,373 $ (182,513) (11.3%) $ 4,339,200 33.0% 5.7% $ 674,698 $ 685,672 $ (10,974) (1.6%) $ 2,037,588 33.1% 0.0% $ 242,667 $ 242,555 $ 111 0.0% $ 728,000 33.3% 65.7% $ 246,075 $ 187,949 $ 58,126 30.9% $ 573,955 42.9% (25.8%) $ 177,886 $ 268,562 $ (90,676) (33.8%) $ 583,457 30.5% (3.2%) $ 17,850,839 $ 16,128,212 $ 1,722,626 10.7% $ 48,471,647 36.8% $ 691,467 $ 665,079 $ 26,388 3.97% $ 2,771,687 $ 2,555,447 $ 216,240 8.5% $ 8,524,717 32.5% $ 1,425,493 $ 1,404,100 $ 21,394 1.5% $ 9,066,599 $ 7,592,277 $ 1,474,322 19.4% $ 20,816,157 43.6% $ 294,168 $ 208,523 $ 85,645 41.1% $ 1,143,943 $ 757,058 $ 386,885 51.1% $ 4,200,000 27.2% $ 64,214 $ 140,121 $ (75,907) (54.2%) $ 316,514 $ 352,376 $ (35,863) (10.2%) $ 2,008,656 15.8% $ 353,650 $ 353,683 $ (34) (0.0%) $ 1,414,892 $ 1,410,168 $ 4,724 0.3% $ 4,190,000 33.8% $ 222,552 $ 222,524 $ 28 0.0% $ 890,209 $ 890,097 $ 111 0.0% $ 2,670,626 33.3% $ 360,004 $ 345,466 $ 14,537 4.2% $ 1,182,079 $ 1,173,801 $ 8,278 0.7% $ 3,791,274 31.2% $ 38,805 $ 49,688 $ (10,883) (21.9%) $ 155,219 $ 198,752 $ (43,533) 21.9% $ 465,657 33.3% $ 3,450,351 $ 3,389,185 $ 61,167 1.8% $ 16,941,141 $ 14,929,976 $ 2,011,165 13.5% $ 46,667,087 36.3% $ 191,137 $ 371,221 $ (180,083) (48.5%) $ 909,698 $ 1,198,237 $ (288,539) (24.1%) $ 1,804,560 50.4% April April i, YTD YTD 2026 2025 Change 2026 2025 Change Gross Margin %: 36.1% 40.8% -4.8% 29.4% 34.1% -4.7% Operating Income Per Revenue $ (%): 3.6% 9.0% -5.4% 4.0% 6.5% -2.5% Net Income Per Revenue $ (%): 5.2% 9.9% -4.6% 5.1% 7.4% -2.3% 2026 HUC Budget Target 32.2% 2.8%N 3.7%N uuIIUuIINNI HUTCHINSON UTILITIES COMMISSION ELECTRIC DIVISION FINANCIAL REPORT FOR APRIL, 2026 333% of Year Comp. 2026 2025 Di . %Chna 2026 2025 Di %Chna FullYrBud %of Bud Electric Division Customer Revenue $ 1,963,394 $ 1,832,316 $ 131,077 7.2% $ 8,445,633 $ 7,640,277 $ 805,356 10.5% $ 27,471,918 30.7% Sales for Resale $ 315,916 $ 713,426 $ (397,510) (55.7%) $ 1,432,860 $ 1,615,373 $ (182,513) (11.3%) $ 4,339,200 33.0% Other Revenues $ 51,094 $ 20,025 $ 31,069 155.2% $ 131,060 $ 80,313 $ 50,747 63.2% $ 202,862 64.6% Interest Income $ 25,291 $ 33,582 $ (8,291) (24.7%) $ 94,519 $ 139,857 $ (45,338) (32.4%) $ 308,457 30.6% TOTAL REVENUES $ 2,355,694 $ 2,599,349 $ (243,654) (9.4%) $ 10,104,072 $ 9,475,819 $ 628,253 6.6% $ 32,322,437 31.3% Salaries & Benefits $ 485,229 $ 504,645 $ (19,416) Purchased Power $ 862,720 $ 866,430 $ (3,711) Transmission $ 294,168 $ 208,523 $ 85,645 Generator Fuel/Chem. $ 64,214 $ 140,121 $ (75,907) Depreciation $ 254,443 $ 255,673 $ (1,230) Transfers (Elect./City) $ 172,817 $ 172,789 $ 28 Operating Expense $ 176,266 $ 204,744 $ (28,477) Debt Interest $ 30,138 $ 32,771 $ (2,633) TOTAL EXPENSES $ 2,339,994 $ 2,385,697 $ (45,703) NET PROFIT/(LOSS) $ 15,700 $ 213,652 $ (197,952) Electric Division (3.8%) $ 2,023,941 $ 1,944,428 $ 79,514 4.1% $ 6,178,442 (0.4%) $ 4,434,366 $ 3,961,827 $ 472,539 11.9% $ 13,035,315 41.1% $ 1,143,943 $ 757,058 $ 386,885 51.1% $ 4,200,000 (54.2%) $ 316,514 $ 352,376 $ (35,863) (10.2%) $ 2,008,656 (0.5%) $ 1,018,064 $ 1,018,660 $ (596) (0.1%) $ 3,060,000 0.0% $ 691,267 $ 691,156 $ 111 0.0% $ 2,073,802 (13.9%) $ 777,178 $ 761,650 $ 15,528 2.0% $ 2,553,967 (8.0%) $ 120,552 $ 131,085 $ (10,533) jLgL $ 361,657 $ 33,471,839 (1.9%) $ 10,525,826 $ 9,618,240 $ 907,586 9.4% (92.7%) $ (421,753) $ (142,421) $ (279,333) 196.1% $ (1,149,402 32.8% 34.0% 27.2% 15.8% 33.3% 33.3% 30.4% 33.3% 31.4% 36.7% 2026 2025 Di . %Chna 2026 2025 Di %Chna FullYrBud %of Bud Residential 3,609,307 3,517,841 91,466 2.60% 16,299,549 16,366,399 (66,850) (0.41%) 54,016,284 30.2% All Electric 165,134 158,531 6,603 4.17% 1,043,197 1,091,516 (48,319) (4.43%) 2,281,979 45.7% Small General 1,310,369 1,309,504 865 0.07% 5,631,581 5,880,914 (249,333) (4.24%) 17,753,235 31.7% Large General 7,772,090 7,077,880 694,210 9.81% 30,073,320 26,117,730 3,955,590 15.15% 92,221,607 32.6% Industrial 7,690,000 7,371,000 319,000 4.33% 30,739,000 32,320,000 (1,581,000) (4.89%) 97,880,814 31.4% Total KWH Sold 20,546,900 19,434,756 1,112,144 5.72% 83,786,647 81,776,559 2,010,088 2.46% 264,153,919 31.7% April April YTD YTD 2026 HUC 2026 2025 Change 2026 2025 Change Budget Target Gross Margin %: 28.3% 36.9% -8.7% 23.4% 28.6% -5.2% 24.7% 24%-28% Operating Income Per Revenue $ (%): -0.6% 8.1% -8.7% -4.9% -1.9% -3.0% -3.6% 0%- 1% Net Income Per Revenue $ (%): 0.7% 8.2% -7.6% -4.2% -1.5% -2.7% -3.6% 0%- 1% Customer Revenue per KWH: $0.0956 $0.0943 $0.0013 $0.1008 $0.0934 $0.0074 $0.1040 $0.1040 Total Power Supply Exp. per KWH: $0.0801 $0.0831 -$0.0029 $0.0907 $0.0813 $0.0094 $0.0911 $0.0911 Net Profit decreased by $197,952 over April 2025. Customer revenue and usage was up but total revenues were still down due to less generation sales. Transmission costs were higher and will continue to be all year. Sales for Resale of $315,916 consisted of $84,916 in market sales, $98,000 in capacity sales to Rice Lake, $70,000 in capacity sales to AEP, and $63,000 in capacity sales to Nextera. April 2025 Sales for Resale of $713,426 included $469,176 in market sales, $98,000 in capacity sales to Rice Lake and $146,250 in capacity sales to AEP. Aprili 2024 Sales for Resale of $246,030 consisted of $1,780 in market sales, $98,000 in capacity sales to Rice Lake and $146,250 in capacity sales to AEP. Overall Purchased Power decreased by $3,711. MRES purchases increased by $35,740 and market purchases/MISO costs decreased by $39,451. The average cost of MISO power was $19.57/mwh (1,910 mwh's purchased), compared to $21.26/mwh (1,750 mwh's purchased) in April 2025. 12026 PCA was $.00228/kwhr bringing in an additional $46,603 for the month and $668,493 YTD. The 4 month average PCA is $.008142 re was no PCA for April 2025 leaving the total collected at $151,798 YTD. Gas Division Customer Revenue Transportation Electric Div. Transfer Other Revenues Interest Income TOTAL REVENUES Salaries & Benefits Purchased Gas Operating Expense Depreciation Transfers (City) Debt Interest TOTAL EXPENSES NET PROFIT/(LOSS) HUTCHINSON UTILITIES COMMISSION GAS DIVISION FINANCIAL REPORT FOR APRIL, 2026 33.3% of Year Comp. 2026 2025 Di %Chna 2026 2025 Di . %Chna Full YrBud %of Bud $ 999,839 $ 875,503 $ 124,335 14.2% $ 6,631,020 $ 5,487,825 $ 1,143,195 20.8% $ 12,737,529 52.1% $ 177,910 $ 168,307 $ 9,604 5.7% $ 674,698 $ 685,672 $ (10,974) (1.6%) $ 2,037,588 33.1% $ 60,667 $ 60,639 $ 28 0.0% $ 242,667 $ 242,555 $ 111 0.0% $ 728,000 33.3% $ 24,876 $ 25,814 $ (938) (3.6%) $ 115,015 $ 107,636 $ 7,379 6.9% $ 371,093 31.0% $ 22,503 $ 30,794 $ (8,291) (26.9%) $ 83,367 $ 128,705 $ (45,338) (35.2%) $ 275,000 30.3% $ 1,285,794 $ 1,161,056 $ 124,738 10.7% $ 7,746,766 $ 6,652,393 $ 1,094,373 16.5% $ 16,149,210 48.0% $ 206,237 $ 160,433 $ 45,804 28.5% $ 747,745 $ 611,019 $ 136,726 22.4% $ 2,346,275 31.9% $ 562,774 $ 537,669 $ 25,104 4.7% $ 4,632,233 $ 3,630,449 $ 1,001,784 27.6% $ 7,780,842 59.5% $ 183,737 $ 140,723 $ 43,015 30.6% $ 404,901 $ 412,151 $ (7,250) (1.8%) $ 1,237,307 32.7% $ 99,207 $ 98,010 $ 1,197 1.2% $ 396,828 $ 391,508 $ 5,320 1.4% $ 1,130,000 35.1% $ 49,735 $ 49,735 $ - 0.0% $ 198,941 $ 198,941 $ 0 0.0% $ 596,824 33.3% $ 8,667 $ 16,917 $ (8,250) 0.0% $ 34,667 $ 67,667 $ (33,000) 48.8% $ 104,000 33.3% $ 1,110,357 $ 1,003,488 $ 106,869 10.6% $ 6,415,315 $ 5,311,736 $ 1,103,579 20.8% $ 13,195,248 48.6% $ 175,437 $ 157,569 $ 17,868 11.3%1 1,331,451 $ 1,340,657 $ (9,206) (0.7%) $ 2,953,962 45.1% o 33.3° . f Year Comp. � P 2026 2025 Di . %Chnq 2026 2025 Di %Chnq Full YrBud %of Bud Gas Division Residential 30,974,409 30,068,592 905,817 3.01% 227,301,973 238,730,515 (11,428,542) (4.79%) 410,283,000 55.4% Commercial 22,894,952 22,140,903 754,049 3.41% 163,418,462 169,485,559 (6,067,097) (3.58%) 317,957,000 51.4% Industrial 67,365,215 66,749,489 615,726 0.92% 338,057,568 349,337,519 (11,279,951) (3.23%) 820,578,000 41.2% Total CF Sold 121,234,576 118,958,984 2,275,592 1.91%1 728,778,003 757,553,593 (28,775,590) (3.80%)l 1,548,818,000 47.1% April April YTD YTD 2026 HUC 2026 2025 Change 2026 2025 Change Budget Target Gross Margin %: 50.5% 49.8% 0.7% 37.2% 42.0% -4.8% 47.7% Operating Income Per Revenue $ (%): 11.4% 11.1% 0.3% 15.6% 18.5% -2.9% 15.9% Net Income Per Revenue $ (%): 13.6% 13.6% 0.1% 17.2% 20.2% -3.0% 18.3% Contracted Customer Rev. per CF: $0.0067 $0.0067 $0.0001 $0.0079 $0.0068 $0.0011 $0.0069 Customer Revenue per CF: $0.0099 $0.0081 $0.0018 $0.0101 $0.0076 $0.0025 $0.0095 Total N.G. Supply Exp. per CF: $0.0051 $0.0047 $0.0004 $0.0065 $0.0049 $0.0016 $0.0053 Notes/Graphs: April Net Income increased by $17,868. Usage and revenues were increased compared to April 2025. The increased revenue was offset some by higher purchased gas and employee costs. Operating expenses were higher due to backhoe repairs and sandblasting and painting of stations. There was no Fuel Cost Adjustment for April 2026 leaving the amount collected from customers at $556,747 YTD. April 2025 Fuel Cost "Credit" Adjustment was $1.83612/MCF crediting customers $102,739 for the month and $457,193 YTD. HUTCHINSON UTILITIES COMMISSION BALANCE SHEET - CONSOLIDATED APRIL 30, 2026 Electric Gas Total Total Net Change Division Division 2026 2025 Total (YTD) Current Assets UnrestrictedlUndesignated Cash Cash (9,212,464.54) 15,996,333.50 6,783,868.96 12,586,205.85 (5,802,336.89) Petty Cash 680.00 170.00 850.00 850.00 - Designated Cash Capital Expenditures - Five Yr. CIP 2,750,000.00 700,000.00 3,450,000.00 3,450,000.00 - Payment in Lieu of Taxes 1,345,802.00 596,824.00 1,942,626.00 1,942,626.00 - Rate Stabilization - Electric 1,301,838.58 - 1,301,838.58 749,832.41 552,006.17 Rate Stabilization - Gas - 356,816.18 356,816.18 615,294.19 (258,478.01) Catastrophic Funds 800,000.00 200,000.00 1,000,000.00 1,000,000.00 - Restticted Cash Bond & Interest Payment 2017 492,356.80 - 492,356.80 493,423.43 (1,066.63) Bond & Interest Payment 2012 - 910,000.00 910,000.00 909,583.31 416.69 Debt Service Reserve Funds 1,175,000.00 2,072,000.00 3,247,000.00 3,255,256.00 (8,256.00) Total Current Assets (1,346,787.16) 20,832,143.68 19,485,356.52 25,003,071.19 (5,517,714.67) Receivables Accounts (net of uncollectible allowances) 2,066,939.62 977,819.58 3,044,759.20 2,638,428.48 406,330.72 Interest 49,785.32 49,785.33 99,570.65 148,628.57 (49,057.92) Total Receivables 2,116,724.94 1,027,604.91 3,144,329.85 2,787,057.05 357,272.80 Other Assets Inventory 2,389,452.54 510,043.12 2,899,495.66 2,628,938.49 270,557.17 Prepaid Expenses 265,453.85 80,376.19 345,830.04 464,126.86 (118,296.82) Sales Tax Receivable 138,513.88 - 138,513.88 408,613.58 (270,099.70) Deferred Outflows- Electric 371,991.00 - 371,991.00 342,759.00 29,232.00 Deferred Outflows - Gas - 123,997.00 123,997.00 114,253.00 9,744.00 Total Other Assets 3,165,411.27 714,416.31 3,879,827.58 3,958,690.93 (78,863.35) Total Current Assets 3,935,349.05 22,574,164.90 26,509,513.95 31,748,819.17 (5,239,305.22) Capital Assets Land & Land Rights 690,368.40 3,899,918.60 4,590,287.00 4,590,287.00 - Depreciable Capital Assets 95,283,676.09 45,149,321.56 140,432,997.65 139,422,804.27 1,010,193.38 Accumulated Depreciation (52,074,313.96) (23,778,224.51) (75,852,538.47) (71,893,347.77) (3,959,190.70) Construction - Work in Progress 10,900,038.13 24,108.87 10,924,147.00 2,834,446.34 8,089,700.66 Total Net Capital Assets 54,799,768.66 25,295,124.52 80,094,893.18 74,954,189.84 5,140,703.34 Total Assets 58,735,117.71 47,869,289.42 106,604,407.13 106,703,009.01 (98,601.88) Current Liabilities Current Portion of Long-term Debt Bonds Payable Bond Premium Lease Liability - Solar Array Accounts Payable Accrued Expenses Accrued Interest Accrued Payroll Total Current Liabilities Long -Term Liabilities Noncurrent Portion of Long-term Debt 2017 Bonds 2012 Bonds Bond Premium 2012 Pension Liability- Electric Pension Liability - Electric OPEB Pension Liability - Nat Gas Pension Liability - Nat Gas OPEB Accrued Vacation Payable Accrued Severance Deferred Outflows - Electric Deferred Outflows - Nat Gas Total Long -Term Liabilities Net Position Retained Earnings Total Net Position HUTCHINSON UTILITIES COMMISSION BALANCE SHEET - CONSOLIDATED APRIL 30, 2026 Electric Gas Total Division Division 2026 820,000.00 19, 546.00 2,421,649.16 150,690.15 112,959.97 3,524,845.28 10,930,000.00 387,543.12 1, 585, 328.00 42,211.00 635,863.89 224,153.38 1,087,158.00 14,892,257.39 2,080,000.00 185,608.32 952,757.85 43,333.25 50,781.58 3,312,481.00 (77,337.17) 528,443.00 14,071.00 224,492.28 44,404.41 362,386.00 1,096,459.52 2,900,000.00 185,608.32 19, 546.00 3,374,407.01 194,023.40 163,741.55 6,837,326.28 10,930,000.00 310,205.95 1, 585, 328.00 42,211.00 528,443.00 14,071.00 860,356.17 268,557.79 1,087,158.00 362,386.00 15,988,716.91 Total Net Change 2025 Total (YTD) 2, 770, 000.00 130, 000.00 185,608.32 - - 19,546.00 3,217,597.96 156,809.05 248,440.10 (54,416.70) 144,886.39 18,855.16 6,566,532.77 270,793.51 11,750,000.00 (820,000.00) 2,080,000.00 (2,080,000.00) 529,271.23 (219,065.28) 1,832,248.00 (246,920.00) 39,880.00 2,331.00 610,749.00 (82,306.00) 13,293.00 778.00 739,330.02 121,026.15 245,721.73 22,836.06 1,294,449.00 (207,291.00) 431,483.00 (69,097.00) 19,566,424.98 (3,577,708.07) 40,318,015.04 43,460,348.90 83,778,363.94 80,570,051.26 3,208,312.68 40,318,015.04 43,460,348.90 83,778,363.94 80,570,051.26 3,208,312.68 Total Liabilities and Net Position 58,735,117.71 47,869,289.42 106,604,407.13 106,703,009.01 (98,601.88) Hutchinson Utilities Commission Cash -Designations Report, Combined 4/30/2026 Financial Institution Current Interest Rate Annual Interest Balance, April 2026 Balance, March 2026 Change in Cash/Reserve Position Savings, Checking, Investments varies varies varies 19,485,356.52 18,667,762.15 817,594.37 Total Operating Funds 19,485,356.52 18,667,762.15 817,594.37 Debt Reserve Requirements Bond Covenants - sinking fund Debt Reserve Requirements Bond Covenants -1 year Max. P & I Total Restricted Funds Operating Reserve Rate Stabalization Funds PILOT Funds Catastrophic Funds Capital Reserves Total Designated Funds Min 60 days of 2026 Operating Bud. Charter (Formula Only) Risk Mitigation Amount 5 Year CIP (2026-2030 Fleet & Infrastructure Maintenance) 1,402,356.80 1,121,885.44 280,471.36 3,247,000.00 3,247,000.00 - 4,649,356.80 4,368,885.44 280,471.36 7,079,514.50 7,079,514.50 - 1,658,654.76 1,621,415.37 37,239.39 1,942,626.00 1,942,626.00 - 1, 000, 000.00 1, 000, 000.00 3,450,000.00 3,450,000.00 - 15,130,795.26 15,093,555.87 37,239.39 YE YE YE YE YTD HUC 2022 2023 2024 2025 2026 Target Debt to Asset 31.4% 28.6% 26.0% 22.3% 21.4% Current Ratio 4.47 4.48 3.67 3.10 3.13 RONA -1.38% 1.96% 2.63% 3.23% 0.96% Historical Change in Cash Balance Month End Electric Elec. Change Natural Gas Gas Change Total Total Change 4/30/2026 (1,346,787) 20,832,144 19,485,357 12/31/2025 (416,323) (930,464) 18,975,091 1,857,053 18,558,768 926,589 12/31/2024 6,134,710 (6,551,033) 17,717,453 1,257,638 23,852,164 (5,293,396) 12/31/2023 12,158,338 (6,023,628) 15,622,242 2,095,211 27,780,580 (3,928,416) 12/31/2022 11,633,212 525,126 15,450,554 171,688 27,083,766 696,815 12/31/2021 12,870,253 (1,237,041) 15,086,000 364,554 27,956,253 (872,487) 12/31/2020 14,239,233 (1,368,981) 15,019,173 66,827 29,258,406 (1,302,153) 12/31/2019 12,124,142 2,115,092 13,837,040 1,182,133 25,961,181 3,297,225 12/31/2018 15,559,867 (3,435,725) 12,335,998 1,501,042 27,895,864 (1,934,683) 12/31/2017 23,213,245 (7,653,378) 10,702,689 1,633,309 33,915,934 (6,020,070) 12/31/2016 8,612,801 14,600,444 9,500,074 1,202,615 18,112,875 15,803,059 12/31/2015 6,170,790 2,442,011 9,037,373 462,701 15,208,163 2,904,712 12/31/2014 3,598,821 2,571,969 6,765,165 2,272,208 10,363,986 4,844,177 * 2017's Significant increase in cash balance is due to issuing bonds for the generator project. Hutchinson Utilities Commission Cash -Designations Report, Electric 4/30/2026 Change in Financial Annual Balance, Balance, Cash/Reserve Institution Current Interest Rate Interest April 2026 March 2026 Position �' Rr Savings, Checking, Investments varies varies varies 19,485,356.52 18,667,762.15 817,594.37 Total HUC Operating Funds 19,485,356.52 18,667,762.15 817,594.37 Debt Restricted Requirements Debt Restricted Requirements Total Restricted Funds Bond Covenants - sinking fund Bond Covenants -1 year Max. P & 1 492,356.80 1,175,000.00 1,667,356.80 393,885.44 1,175,000.00 1,568,885.44 98,471.36 - 98,471.36 Excess Reserves Less Restrictions, Electric (3,014,143.96) (3,175,345.19) 161,201.23 J11J! !!1 1 !1 J Operating Reserve Min 60 days of 2026 Operating Bud. 5,068,639.83 5,068,639.83 - Rate Stabalization Funds $400K-$1.2K 1,301,838.58 1,301,838.58 PILOT Funds Charter (Formula Only) 1,345,802.00 1,345,802.00 Catastrophic Funds Risk Mitigation Amount 800,000.00 800,000.00 Capital Reserves 5 Year CIP (2026-2030 Fleet & Infrastructure Maintenance) 2,750,000.00 2,750,000.00 Total Designated Funds 11,266,280.41 11,266,280.41 - Excess Reserves Less Restrictions & Designations, Electric :0 YE YE YE YE YTD APPA Ratio HUC 2022 2023 2024 2025 2026 5K-10K Cust. Target Debt to Asset Ratio (* w/Gen.) 34.8% 34.0% 33.9% 31.6% 31.4% 39.8% pp ppppp ryry NNNNNNNNNNNN Current Ratio 4.96 4.35 2.38 0.80 0.54 3.75 >2.0 RONA -4.2% -0.9% -2.1% 0.4% -0.8% NA >0% Hutchinson Utilities Commission Cash -Designations Report, Gas 4/30/2026 Change in Financial Annual Balance, Balance, Cash/Reserve Institution Current Interest Rate Interest April 2026 March 2026 Position F�' Rr Savings, Checking, Investments varies varies varies 19,485,356.52 18,667,762.15 817,594.37 Total HUC Operating Funds 19,485,356.52 18,667,762.15 817,594.37 Debt Restricted Requirements Bond Covenants - sinking fund 910,000.00 728,000.00 182,000.00 Debt Restricted Requirements Bond Covenants -1 year Max. P & 1 2,072,000.00 2,072,000.00 - Total Restricted Funds 2,982,000.00 2,800,000.00 182,000.00 Excess Reserves Less Restrictions, Gas 17,850,143.68 17,474,221.90 375,921.78 1 1 JJJ1 111 1 11 J J Operating Reserve Min 60 days of 2026 Operating Bud. 2,010,874.67 2,010,874.67 - Rate Stabalization Funds $200K-$600K 356,816.18 319,576.79 37,239.39 PILOT Funds Charter (Formula Only) 596,824.00 596,824.00 - Catastrophic Funds Risk Mitigation Amount 200,000.00 200,000.00 Capital Reserves 5 Year CIP (2026-2030 Fleet & Infrastructure Maintenance) 700,000.00 700,000.00 - Total Designated Funds 3,864,514.85 3,827,275.46 37,239.39 YE YE YE YE YTD HUC 2022 2023 2024 2025 2026 AGA Ratio Target Debt to Asset 26.5% 21.0% 15.5% 10.6% 9.2% 35%-50% Current Ratio 4.06 4.61 5.08 5.18 5.88 1.0-3.0 RONA 3.0% 6.2% 9.1% 7% 3.2% 2%-5% Notes/Graphs: ELECTRIC DIVISION Operating Revenue April 2026 CLASS AMOUNT KWH /KWH Street Lights 20.88 383 $0.0545 Electric Residential Service $446,073.80 3,609,307 $0.1236 All Electric Residential Service $19,765.39 165,134 $0.1197 Electric Small General Service $152,164.67 1,310,369 $0.1161 Electric Large General Service $731,307.91 7,772,090 $0.0941 Electric Large Industrial Service $614,061.20 7,690,000 $0.0799 Total $1,963,393.85 20,547,283 $0.0956 Power Adjustment $0.00228 Rate Without Power Adjustment $0.09328 Electric Division Year -to -Date ® 2026 $ Amount ❑ 2025 $ Amount ® 2026 KWH110 ❑ 2025 KWH110 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0 EM Residential All Elec. Resid. Small Gen. Srv. Large Gen. Srv. Large Industrial Sales For Resale Total NOTE: This graph includes sales for resale (capacity and energy sales) but excludes street lights and security lights NATURAL GAS DIVISION Operating Revenue April 2026 CLASS AMOUNT MCF /MCF Residential $319,104.16 30,974 $10.3022 Commercial $221,397.32 22,895 $9.6701 Large Industrial $29,711.46 3,591 $8.2734 Large Industrial Contracts $429,625.85 63,774 $6.7367 Total $999,838.79 121,235 $8.2471 Fuel Adjustment $0.00000 Rate Without Fuel Adjustment $8.24714 Natural Gas Division Year -to -Date ❑ 2026 $ Amount ❑ 2025 $ Amount m 2026 MCF ❑ 2025 MCF 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 Gas Residential Gas Commercial Large Industrial Large Industrial Total Contracts N� O O O O Q N N N .E Q Q Q Q Q Q Q Q Q Q N O O O O O O O Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q N Q r Q Q Q Q N Q Q Q N Q Q N Q Q Q Q N Q N Q Q N Z ZM OM ON W, Z Z Z Z Z Z Z Z Z Z �2 Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z Z> Z Z Z Z � Z Z Z Z Z Z Z Z Z Z Z Z W W o Q W O O O O O > O O O O O N N 0 W M � O O O O O � Q� Q� V' OIL Q� NO Q� OV'O V'00000 V'O V'�W�WNQ�Q�OW WOOW VI�OOWOMMI� VQ�� Q� O N W � ON ISO W OWONI�OOI�N Q�VOMVI�NV'W000�0WNOQ�WNW V'N VIA V'W� M OD >> W I� W,N� 2 W m W N V'M W Mm0NN000� V'I� W O V Q� V Q�I�M W OD 0'MNmNm I� Q� Q� W I� v r Q� I� V W N M M N N— I� r V' W V' M— O Q- W N N V' W O Q� � MOW Q� m vl�l�01��� ao OO Q� Q� V' ON N N OO N O NN Q� NO Q� NV'OW00000 V'O Q��W�MN�Q�OW WOOV'V'NOOWOWMW V'Q�� Q� O _ J QqW I� N W N N M W W M N W N W N M I� M � Q� W MIS W IOW O Wr WNI�WMO � MON V'M rl- �Nn O Q OI�r WOMW WQ�V'I�WI� WNW W O c NN W OMM �W W W W �W WI�NI�NOMWWQ�V'Q�OWN�WNMWM � � W M N W M N N �� Q� WIC N M W V'Q�M V'Q� OV'NWO�V'NNWM(O V'I�W WI�NV'M V'N NQ�N V'N V' W Q� � •� N O O W O M O OO V' � W O V' OOOOOOOO W o c c o c c o o m ISO W OWONI�OOrN Q�V'OMV'I�NNMOOO�OWI�OQ�WNW WNV'N V'W� M N coo y OO W W N Q� OOOOOOOO N I� O NOW�NN��W MW WI�rWOQ�WNMN�N�W WI��NW—mmV' OMW ' y �p =O OO N N M� 00000000 N O O N O O � W O O O O O O O O N V'M Q� WNQq nn - - WQ�W NV'MW W WONNOOOW - - naO W I� O r N � W N N N I� r V W V' M Q� � O W N N O � � V' � Q� � W N M I� N V: L O O W N W V' N N N W N N NN W O N N OO W O M N MN:1 O OMNMI�Q� I� W OOM NQ�I� Q�Q� I�VM OQ�O NI�OONW W��WNQ�I�r�MV'Q�I�NI�NNW WOW W NNN N 0 d a A A A A A AA M N N O N M M N N N N N N N N N N N N N N M V' N N N V'N N V' fp m � W. . 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U r— T L v w ao w L 0 a N 0) �co 0 Co -� L a) co \ 0 E c N co c a) .\i Y co co .. I ui O d CL d w a L d E O ch U d cm m N a HUTCHINSON UTILITIES COMMISSION Board Action Form �rre tit' Agenda Item: Review Policies Presenter: Angie Radke Agenda Item Type: Time Requested (Minutes): 5 Review Policies Attachments: Yes BACKGROUND/EXPLANATION OFAGENDA ITEM: As part of HUC's standard operating procedures, a continual policy review is practiced. This month, the following policies were reviewed and no changes are recommended on these policies at this time: i. Section 5 of Exempt Handbook ii. Section 5 of Non -Exempt Handbook BOARD ACTION REQUESTED: None Fiscal Impact: Included in current budget: Budget Change: PROJECT SECTION: Total Project Cost: Remaining Cost: EXEMPT VACATION Exempt employees shall accrue paid vacation on the employment anniversary date according to the following schedule: Years Employed Upon Hire After 6 months 1 6 10 11 12 13 14 15 16 17 18 19+ Total Hrs. Earned 20 40 80 120 128 136 144 152 160 168 176 184 192 200 Vacation Earned Per Pay Period First 12 Pa Period Accruals 1.53 3.08 First 25 Pa Period Accruals 3.08 4.62 4.93 5.24 5.54 5.85 6.16 6.47 6.77 7.08 7.39 7.70 Last Pa Period Accrual 1.64 3.04 Last Pa Period Accrual 3.00 4.50 4.75 5.00 5.50 5.75 6.00 6.25 6.75 7.00 7.25 7.50 Vacation may be used after completion of the probationary period. Employees must receive prior approval of their vacation requests from their Manager or Supervisor. A vacation request for more than one day must be submitted at least two workdays in advance. (For example, if an employee is scheduled to work Wednesday, Thursday, Monday and the employee wants to take Monday afternoon as vacation, the employee must submit a request in person by Wednesday afternoon.) An employee may carry over up to a maximum of two times their annual vacation accrual into the subsequent calendar year. Vacation year is defined as a calendar year. After the first year of employment an employee is required to use a minimum of 40 hours of vacation per calendar year. If the Employer determines that due to workload, an employee cannot utilize sufficient accrued vacation, by mutual agreement between the employee and the Employer, either a temporary extension beyond the maximum carryover amount may be granted or a vacation payout of not to exceed 40 hours will be granted. Employees who are on vacation and experience a disabling accident or illness may use sick leave instead of vacation upon providing their Manager or Supervisor appropriate proof of the accident or illness. HOLIDAYS Employees are eligible for holiday pay effective immediately upon hire. HUC shall observe the following days as holidays: • New Year's Day • Martin Luther King Day • President's Day • Memorial Day • Juneteenth • Fourth of July • Labor Day • Veteran's Day • Thanksgiving Day • Christmas Day If the holiday falls on a Sunday, the following Monday shall be the holiday. If the holiday falls on a Saturday, the preceding Friday shall be the holiday. If Christmas falls on a Tuesday, Wednesday, Thursday or Friday, then the preceding day shall be a Christmas Eve Day holiday. Additionally, there shall be two (2) floating holidays determined by mutual agreement between the employee and Manager or Supervisor. If Christmas falls on a Saturday, Sunday, or Monday, there shall be no Christmas Eve Day holiday but there shall be three (3) floating holidays determined by mutual agreement between the employee and Manager or Supervisor. Floating holidays must be used by the end of each calendar year. Employees shall be paid eight (8) hours straight time for each of the holidays. Temporary employees who work on a holiday shall be paid at the employee's regular base pay rate and shall not receive holiday pay for hours not worked. LIFE INSURANCE HUC provides group term life insurance with accidental death and dismemberment for all full- time employees. HUC also offers voluntary term life insurance for all full-time employees. Information on life insurance is available through human resources/payroll. HEALTH/DENTAL INSURANCE HUC provides an opportunity for employees to participate in a group health (HSA)/dental insurance program. Employees are eligible for coverage the first of the month following hire date. Contact human resources/payroll for information regarding benefits and participation levels. Contact the human resources/payroll for information about continuation of health/dental insurance coverage after leaving. For those employees who participate in the high deductible family plan, HUC will contribute $4,000 annually into the HSA and for those employees participating in the high deductible single plan, HUC will contribute $2,000 annually into the HSA. Contributions are made in bi-weekly installments. Based on Internal Revenue Service rules, an employee must be an eligible individual to qualify for an HSA including generally having no other health coverage that is not a high deductible health plan. Veterans of the United States armed forces who receive medical benefits from the Veterans Administration (VA) or employees who are enrolled in TRICARE, which is health insurance available to active duty and retired service and reserve members and their dependents, are therefore not eligible to qualify for an HSA, but are eligible to participate in the high deductible health plan. A veteran who receives medical benefits from the Veterans Administration (VA) or employees who are enrolled in TRICARE who participate in the high deductible family plan, but who is/are not eligible to qualify for an HSA, shall receive $4,000 annually in two equal installments in lieu of said monies being deposited in an HSA. A veteran who receives medical benefits from the Veterans Administration (VA) or employees who are enrolled in TRICARE who participates in the high deductible single plan, but who is/are not eligible to qualify for an HSA, shall receive $2,000 annually in two equal installments in lieu of said monies being deposited in an HSA. DISABILITY INSURANCE HUC pays the entire premium of a long-term disability insurance policy for all employees. Information on disability insurance is available through human resources/payroll. FAMILY AND MEDICAL LEAVE (FMLA) Pursuant to the Family and Medical Leave Act, employees are allowed up to 12 weeks unpaid leave during a 12-month period for the following reasons: • Birth or care of the newborn child of the employee • Placement with the employee of a child for adoption or foster care • Serious health condition of the employee that makes the employee unable to perform the functions of the position of such employee • In order to care for an employee's dependent child, spouse, or parent suffering from a serious health condition • Any qualifying exigency arising out of the fact that the spouse, or a son, daughter or parent of the employee is on active duty, or has been notified of an impending call or order to active duty) in the Armed Forces in support of a contingency operation. Up to twenty-six (26) weeks of protected leave per twelve (12) month period shall be granted to all eligible employees for the following reasons: • An eligible employee who is the spouse, son, daughter, parent, or next of kin of a covered service member shall be entitled to a total of 26 workweeks of leave during a twelve (12) month period to care for the service member. The leave described in this paragraph shall only be available during a single twelve (12) month period. • A covered service member is defined as a member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness. The term "serious injury or illness", in the case of a member of the Armed Forces, including a member of the National Guard or Reserves, means an injury or illness incurred by the member in the line of duty on active duty in the Armed Forces that may render the member medically unfit to perform the duties of the member's office, grade, rank, or rating. Spouses employed by HUC, both in regular positions, are jointly entitled to a combined total of 12 work weeks of family leave for the birth and care of a newborn child, for placement of a child for adoption or foster care, and to care for a parent who has a serious health condition. Spouses are entitled to a combined total of 26 weeks during a single twelve (12) month period to care for an eligible service member. During the single twelve (12) month period, an eligible employee shall be entitled to a combined total of 26 work weeks of total leave allowed under the FMLA. To be eligible for FMLA leave, the employee must have worked at least one year for HUC and worked at least 1,040 hours during the previous 12 months. In order to receive FMLA leave, the employee must request the leave by providing human resources/payroll 30-day's notice prior to the requested starting date of the leave. If 30-day's notice is not possible, the employee must provide as much notice as possible. Human resources/payroll shall provide the employee a "Medical Certificate" which must be completed by the employee's physician and returned to human resources/payroll. Pursuant to the FMLA, HUC may request a second opinion from another medical provider at HUC's expense. If the second opinion is different from the employee's physician's opinion, HUC shall seek a third opinion at HUC's expense. The third opinion shall prevail. HUC may require that a request for leave related to active duty or call to active duty be supported by a certification issued by the health care provider of the service member being cared for by the employee. The 12 weeks of available FMLA leave extend over 12 months. To determine whether the employee has any FMLA leave remaining, human resources/payroll shall review the 12 months preceding the request for FMLA. An employee may use the 12 weeks of FMLA leave intermittently over the 12-month period if necessary and may take the leave in increments of one hour or more. HUC may require a medical certificate attesting to the employee's fitness for duty prior to return to work. The fitness for duty report must be based on the particular health condition(s) for which the leave was approved and must address whether the employee can perform the essential functions of his/her regular position. An employee on FMLA leave for serious illness of the employee, the employee's spouse, dependent child or parent shall be required to use vacation or sick leave concurrent with the FMLA leave. HUC shall continue to pay its contribution toward health and dental insurance while an employee is on FMLA leave. The employee shall be required to continue payment of the employee portion of the premiums during the leave. If the employee fails to pay their portion of the premiums, HUC may terminate their insurance coverage subject to COBRA requirements. At the end of FMLA leave, an employee shall be returned to his/her former position or an equivalent position. For more information on FMLA leave, see human resources/payroll. PREGNANCY AND PARENTING LEAVE Pursuant to the Minnesota Pregnancy and Parenting Act, all employees are entitled to take an unpaid leave of absence. Female employees are eligible for prenatal care, or incapacity due to pregnancy, childbirth, or related health conditions as well as a biological or adoptive parent in conjunction with the birth or adoption of a child are eligible for up to twelve (12) weeks of unpaid leave. Any paid or unpaid leave taken for prenatal care medical appointments will not count toward the 12-week leave. Additionally, leave under this section must begin within twelve (12) months of the birth or adoption of the child. In the case where the child must remain in the hospital longer than the mother, the leave must begin within twelve (12) months after the child leaves the hospital. Eligible employees should provide reasonable notice, which is at least thirty (30) days written notice to human resources/payroll of their desire to take parental leave. Employees may choose to use their paid leave banks, such as sick leave or vacation. If the employee is also eligible for FMLA leave, the pregnancy and parenting leave under this section and FMLA leave shall run concurrently. The employee is entitled to return to work in the same position and at the same rate of pay the employee was receiving prior to commencement of the leave. Group insurance coverage will remain available while the employee is on leave pursuant to the Pregnancy and Parenting Leave Act, but the employee will be responsible for the employee share of the premium unless otherwise provided in this policy (i.e., where leave is also FMLA qualifying). For employees on an FMLA leave absence as well, the employer contributions toward insurance benefits will continue during the FMLA leave absence. REASONABLE PAID WORK TIME FOR NURSING MOTHERS Nursing mothers will be provided reasonable paid break times to express milk for nursing her child for one year after the child's birth. HUC will provide a room (other than a bathroom) as close as possible to the employee's work area, that is shielded from view and free from intrusion from coworkers and the public and includes access to an electrical outlet, where the nursing mother can express milk in private. REASONABLE ACCOMMODATIONS TO AN EMPLOYEE FOR HEALTH CONDITIONS RELATING TO PREGNANCY HUC will attempt to provide a female employee who requests reasonable accommodation with the following for her health conditions related to her pregnancy or childbirth. Without advice of a licensed health care provider or certified doula: • More frequent restroom, food and water breaks; Seating; and/or Limits on lifting over 20 pounds and/or Additionally, an employer must provide reasonable accommodations, including, but not limited to, temporary leaves of absence, modification in work schedule or job assignments, seating, more frequent or longer break periods and limits to heavy lifting to an employee for health conditions related to pregnancy or childbirth upon request, with the advice of a licensed health care provider or certified doula, unless the employer demonstrates the accommodation would impose an undue hardship on the operation of the employer's business. In accordance with state law, no employee is required to take a leave of absence for a pregnancy nor accept a pregnancy accommodation. An employer shall not discharge, discipline, penalize, interfere with, or otherwise retaliate or discriminate against an employee for asserting reasonable accommodations pregnancy rights or remedies SICK LEAVE 1. Sick leave shall be granted to all probationary and non -probationary employees at a rate of eight (8) hours per month. 2. Sick leave may be granted for absence from duty due to personal illness, or for the illness of an immediate family (See Definitions) member on the same terms the employee is able to use sick leave benefits for their own illness, including appointments for necessary medical, dental or eye care, legal quarantine, or brief emergency situation (not to exceed one day) in the immediate family (See Definitions). 3. Sick leave cannot be accumulated beyond 720 hours. After the accumulation of 720 hours, a payback of one-half of the amount over 720 hours shall be made annually on or about February 1. 4. Upon retirement or death before retirement, a payback of one-third of any unused sick leave which has been accumulated shall be made. If the employee resigns or is dismissed, the above payment shall not be made. In case of death during employment, the unused sick leave shall be paid to his/her estate on the same percentage as above. 5. Requests for sick leave consideration in case of other emergency situations may be brought to the Manager or Supervisor. 6. A maximum of five days funeral leave may be allowed when necessary in the case of death in the immediate family (See Definitions). 7. If an employee becomes ill and must stay home from work, he/she shall notify their Manager or Supervisor before their work day begins. 8. If an employee becomes ill during his/her regular work day, they shall notify their Manager or Supervisor that it is necessary to leave due to illness. 9. Employees may be required to submit a medical certificate for any sick leave, at the discretion of the Manager or Supervisor. 10. The use or claim of sick leave for apurpose not authorized may be cause for disciplinary action. 11. For the purpose of accumulating additional vacation or sick leave, an employee using earned vacation or sick leave is considered to be in a paid or working status. 12. Employees that are injured while engaged in after hours' employment of others or while self employed, shall not be covered under HUC's Sick Leave Policy, or Worker's Compensation benefits. 13. An employee who is determined to be eligible for workers compensation benefits during absence from duty shall receive such benefits pursuant to "Worker's Compensation" in the Employee Handbook. 14. HUC shall comply with the Family and Medical Leave Act, the Minnesota Parental Leave Act and the Americans with Disabilities Act. 15. Safety leave. Employees are authorized to use sick leave for reasonable absences for themselves or immediate family (See Definitions) who are providing or receiving assistance because they, or a relative, is a victim of sexual assault, domestic abuse, or stalking. Safety leave for those listed, other than the employee and the employee's child, is limited to 160 hours in any calendar year. After accrued sick leave has been exhausted, vacation leave may be used upon approval of the General Manager, to the extent the employee is entitled to such leave. EARNED SICK AND SAFE LEAVE This Policy defines Hutchinson Utilities' compliance with the Minnesota Earned Sick and Safe Time (ESST) law outlined in Minnesota Statutes, §§ 181.9445 to 181.9448, effective January 1, 2024. Earned Sick and Safe Leave (ESST) is paid leave employers must provide to employees in Minnesota that can be used for certain reasons. The hourly rate of paid ESST is the same hourly rate an employee earns from employment with Hutchinson Utilities. This ESST Policy applies to employees who work in the State of Minnesota as an employee of the County for at least eighty (80) hours in a year, including seasonal, temporary, on -call, casual employees; and all full-time and part-time employees. For purposes of ESST compliance, the leave year is defined as the calendar year — January 1 through December 31. FOR FULL-TIME EMPLOYEES: For purposes of satisfying ESST, Hutchinson Utilities has previously negotiated or provided to employees paid vacation and sick leave which meets or exceed ESST minimum requirements under the law. The first 48 hours of paid vacation/sick leave used will be cross -designated as ESST. If the employee chooses to use paid vacation/sick leave for reasons other than those outlined in this policy as ESST eligible hours, the employee will not be provided with additional ESST hours. While an employee may use paid vacation/sick leave hours for an ESST purpose, the employee will not be provided with additional ESST hours once available hours have been exhausted. Once an employee has used their yearly 48 hours of ESST (or up to a maximum of 80 hours if an employee has any ESST carry over from prior years), none of their remaining vacation/sick leave they subsequently accrue or use in that year will be designated as ESST. Accordingly, the provisions of Minn. Stat. §§ 181.9445 — 181.9448 or this policy do not apply to paid vacation/sick leave taken after an employee has used their yearly ESST entitlement. FOR SEASONAL EMPLOYEES: All seasonal employees are eligible to earn ESST when at least 80 hours of work are performed in a calendar year (January 1 — December 31). An employee who works at least 80 hours in a calendar year will earn one (1) hour of ESST leave for every 30 hours worked, up to a maximum accrual of 48 hours per calendar year. Employees begin accruing ESST on their first day of employment. Employees may roll over unused ESST to the next year up to a maximum accrual of 80 ESST hours. For the purposes of this policy, ESST leave used by an employee does not count towards hours worked. Accrued and unused ESST will not be paid out to seasonal employees upon separation from employment. Earned Sick and Safe Leave Use The leave may be used as it is accrued in the smallest increment of time tracked by the employer's payroll system and may be used for the following circumstances: • An employee's own: o Mental or physical illness, injury or other health condition o Need for medical diagnosis, care or treatment, of a mental or physical illness o injury or health condition o Need for preventative care o Closure of the employee's place of business due to weather or other public emergency o The employee's inability to work or telework because the employee is prohibited from working by the city due to health concerns related to the potential transmission of a communicable illness related to a public emergency, or seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, a communicable disease related to a public emergency and the employee has been exposed to a communicable disease or the city has requested a test or diagnosis. o Absence due to domestic abuse, sexual assault, or stalking of the employee provided the absence is to: ■ Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking ■ Obtain services from a victim services organization ■ Obtain psychological or other counseling ■ Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking ■ Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking o Care of a family member: o With mental or physical illness, injury or other health condition Who needs medical diagnosis, care or treatment of a mental or physical illness, injury or other health condition Who needs preventative medical or health care Whose school or place of care has been closed due to weather or other public emergency When it has been determined by health authority or a health care professional that the presence of the family member of the employee in the community would jeopardize the health of others because of the exposure of the family member of the employee to a communicable disease, whether or not the family member has actually contracted the communicable disease o Absence due to domestic abuse, sexual assault or stalking of the employee's family member provided the absence is to: ■ Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking Obtain services from a victim services organization ■ Obtain psychological or other counseling ■ Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking ■ Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking For Earned Sick and Safe Leave burnoses_ familv member includes an emblovee's: • Spouse or registered domestic partner • Child, foster child, adult child, legal ward, child for whom the employee is legal guardian, or child to whom the employee stands or stood in loco parentis • Sibling, step sibling or foster sibling • Biological, adoptive or foster parent, stepparent or a person who stood in loco parentis when the employee was a minor child • Grandchild, foster grandchild or step grandchild • Grandparent or step grandparent • A child of a sibling of the employee • A sibling of the parent of the employee or • A child -in-law or sibling -in-law • Any of the above family members of a spouse or registered domestic partner • Any other individual related by blood or whose close association with the employee is the equivalent of a family relationship • Up to one individual annually designated by the employee Advance Notice for use of Earned Sick and Safe Leave If the need for sick and safe leave is foreseeable, RUC requires seven days' advance notice. However, if the need is unforeseeable, employees must provide notice of the need for Earned Sick and Safe time as soon as practicable. When an employee uses Earned Sick and Safe time for more than three consecutive days, HUC may require appropriate supporting documentation (such as medical documentation supporting medical leave, court records or related documentation to support safety leave). However, if the employee or employee's family member did not receive services from a health care professional, or if documentation cannot be obtained from a health care professional in a reasonable time or without added expense, then reasonable documentation may include a written statement from the employee indicating that the employee is using, or used, Earned Sick and Safe Leave for a qualifying purpose. HUC will not require an employee to disclose details related to domestic abuse, sexual assault, or stalking or the details of the employee's or the employee's family member's medical condition. In accordance with state law, HUC will not require an employee using Earned Sick and Safe leave to find a replacement worker to cover the hours the employee will be absent. Retaliation prohibited HUC shall not discharge, discipline, penalize, interfere with, or otherwise retaliate or discriminate against an employee for asserting Earned Sick and Safe Leave rights, requesting an Earned Sick and Safe Leave absence, or pursuing remedies. Additionally, it is unlawful to report or threaten to report a person or a family member's immigration status for exercising a right under Earned Sick and Safe Leave. Any employee who believes that they have been wrongfully denied ESST, retaliated, or discriminated against for requesting or using ESST must immediately notify Human Resources. The use of ESST will not be factored into any attendance point system the Utility may use. An employee has the right to file a complaint or bring a civil action if ESST is denied by the Utility or if the employee is retaliated against for requesting or using ESST. An employee injured by a violation of this policy pursuant to sections §§ 181.9445 - 181.9448 may file a complaint with the Minnesota Department of Labor and Industry and bring a civil action to recover any and all damages recoverable by law. Questions regarding ESST or this policy should be directed to Human Resources. Employees may contact the Minnesota Department of Labor and Industry's Labor Standards Division at 651-284- . a s (i),state.mn.�us or visit the department's earned sick and safe time 5075 or ..... l ............ webpage at 1..:.��n..:.aoy/sick....ieave. Benefits and return to work protections During an employee's use of Earned Sick and Safe Leave, an employee will continue to receive HUC's employer insurance contribution as if they were working, and the employee will be responsible for any share of their insurance premiums. An employee returning from time off using accrued Earned Sick and Safe Leave is entitled to return to their HUC employment at the same rate of pay received when their leave began, plus any automatic pay adjustments that may have occurred during the employee's time off. Seniority during Earned Sick and Safe Leave absences will continue to accrue as if the employee has been continually employed. When there is a separation from employment with HUC and the employee is rehired again within 180 days of separation, previously accrued Earned Sick and Safe Leave that had not been used will be reinstated. An employee is entitled to use and accrue Earned Sick and Safe Leave at the commencement of reemployment. Disclaimer This policy is not a contract for employment. The Utility periodically may update this policy and reserves the right to interpret the policy as well as replace, modify, or revoke it at any time, upon reasonable notice. MINNESOTA PAID LEAVE HUC provides time off to eligible employees who qualify for Minnesota Paid Leave (MNPL) benefits under Minnesota law. HUC is a participant in an equivalent plan through an approved private insurance carrier. MNPL benefits are funded through premium contributions payable to the equivalent plan through an approved private insurance carrier. The premium cost will be split between HUC and employees as follows: HUC will pay 50% of the required premium and employees will pay 50% of the premium cost through payroll deductions starting January 1, 2026. ELIGIBILITY: Eligibility determinations for MNPL benefits are made by the approved private insurance carrier. Generally, to be eligible for MNPL, the employee must: • Work at least 50% of the time from a location in Minnesota, including employees who work from home or spend time in other states occasionally. • Meet the financial eligibility requirements by having earned over a specific amount of wages as defined by Minnesota law at the time of the requested leave. BENEFIT AMOUNT: HUC does not determine eligibility or benefit amount. Benefit amount is determined by the approved private insurance carrier. LEAVE ENTITLEMENT AND USAGE: The approved private insurance carrier may approve MNPL leave for the following conditions in a benefit year: • Up to 12 weeks of medical leave (for yourself) to take care of yourself for a serious health condition, including pregnancy, childbirth, recovery, or surgery. • Up to 12 weeks of family leave to: o Bond with a child through birth, adoption, or foster placement within 12 months of birth or placement of a child o Care for a family member with a serious health condition o Support a military family member called to active duty o Receive covered types of care for yourself or a family member because of domestic abuse, sexual assault, or stalking You can take both types of leave in the same year, but you cannot exceed 20 weeks total within a single benefit year. For example, an employee may be entitled to 12 weeks of family leave to bond with a child and another 8 weeks of medical leave for their serious health condition. Benefit year starts the first day Paid Leave is taken. There is no waiting period for MNPL if MNPL is granted. MNPL INTERMITTENT LEAVE: Employees may apply for intermittent leave in most cases, provided the leave is reasonable and appropriate to the needs of the individual requiring care. A. Eligibility In addition to the other eligibility requirements under the MN Paid Leave law, employees seeking intermittent leave must have at least eight hours of accumulated leave (unless more than 30 days have lapsed since taking the initial leave). B. Notice In situations where employees seek MNPL on an intermittent basis, employees must make a reasonable effort to provide written notice to HUC Admin/HR Coordinator of the need for intermittent leave before applying for MNPL benefits through the approved private insurance carrier. As part of the notice, employees must provide HUC with the following: 1. proposed intermittent leave schedule; and 2. a completed certification from a health care provider identifying the leave as necessary and a reasonable estimate of the frequency, duration, and treatment schedule for the leave. C. Increments of Leave & Maximum Number of Hours Consistent with other forms of leave provided by HUC, employees may take intermittent leave in increments of .25 hours. If eligible for intermittent leave, HUC allows a maximum of 480 hours of intermittent leave in any 12-month period. After reaching the maximum amount of allowed intermittent leave, employees may request continuous MNPL provided the continuous leave does not exceed the maximum amount of MNPL allowed by law. DEFINITIONS: • Family member c•7 Spouse or partner • Child (including biological, adopted, step, or foster children, or a child you raise even if you are not legally related) r:> Parent or person who raised you o Sibling r:> Grandchild or Grandparent r:> In-laws (including son, daughter, father, or mother) o Anyone close to you who depends on you like family, even if not related by blood. • A Serious health condition means a physical or mental illness, injury, impairment, condition, or substance use disorder. Taking care of yourself for this serious condition may involve evaluation, treatment, inpatient care, recovery, or not being able to perform regular work, attend school, or do regular daily activities. This includes childbirth, conditions related to pregnancy, or surgery. Please see Admin/HR Coordinator for more information regarding a serious health condition. NOTICE: Prior to starting a claim with the equivalent plan through an approved private insurance carrier, employees should reach out to HR to notify the intention to take leave. If the need is foreseeable, HUC asks that the employee provide at least 2 weeks' notice prior to taking leave. If the leave is not foreseeable the employee will still be able to take leave under MNPL. HUC asks that the employee provide as much notice as possible. HOW TO APPLY FOR MINNESOTA PAID LEAVE: After leave has been discussed with HR/Admin Coordinator, employee may apply for MNPL through the equivalent plan that HUC has received approval on from the State. Please see Admin/HR Coordinator for more information regarding where to apply. INTERACTION WITH OTHER LAWS AND BENEFITS: MNPL will run concurrently with any leave and/or wage supplement for which you may be eligible for under local, state, or federal law which may include: FMLA and Pregnancy and Parenting Leave. SUPPLEMENTING MNPL BENEFITS WITH ACCRUED PAID LEAVE: If receiving MNPL benefits, HUC allows the employee to supplement, or "top off," MNPL benefits with any accrued but unused paid leave. If an employee chooses to supplement MNPL benefits in this way, the combined weekly sum of MNPL benefits and HUC paid leave benefits cannot exceed the employees' Individual Average Weekly Wage (IAWW). For more information contact Admin/HR Coordinator. MAINTAINING HEALTH COVERAGE DURING LEAVE: Unless the employee revokes coverage while on MNPL, HUC will continue to provide group health insurance coverage for an employee on MNPL under the same conditions as the coverage was provided before the employee took leave. The employee must continue to make timely payments for his/her share of the premiums for such coverage. If the employee is not using paid time off to cover part or all the leave, the employee will be responsible for remitting his/her portion of health premiums to HUC in order to ensure continuation of benefits. Group health insurance may be cancelled if an employee's premium payment is 30 days late. Before terminating coverage, HUC will provide written notice to the employee at least 15 days before the coverage is terminated listing the final date payment is due (30 days past the due date) to avoid cancellation and the date coverage will end if payment is not received. An employee's share of premium payments for his/her group health insurance coverage may, at the employee's option, be: 1. Prepaid at or before the start of the leave in which his/her health deductions may be modified to accept the agreed upon amounts and frequency of premium deductions; 2. Arranged to write a check every 2-4 weeks for the duration that the employee may be out; 3. Be postpaid after the leave ended in which his/her health deductions may be modified to accept the agreed upon amounts and frequency of premium deductions. Coverage that lapses due to nonpayment of premiums will be reinstated immediately upon return to work without a waiting period. REINSTATEMENT: Upon return from covered MNPL, the employee will be reinstated to his/her previous position or to an equivalent position, with the same status, pay, employment benefits, length -of service credit, and seniority credit as of the date of leave as long as he/she has worked for HUC for a minimum of 90 calendar days. Upon return to work, if it becomes evident that the employee is unable to perform the key essential functions of his/her position (with or without reasonable accommodation), HUC may engage in an interactive process, consistent with the American with Disability Act (ADA) and/or Minnesota Human Rights Act (MHRA) and other applicable workplace policies, including workplace safety protocols, to determine appropriate next steps. RETALIATION: HUC will not interfere or retaliate against employees who request or take leave in accordance with the MN Paid Leave law. Disclaimer This policy is not a contract for employment. The Utility periodically may update this policy and reserves the right to interpret the policy as well as replace, modify, or revoke it at any time, upon reasonable notice. SICKNACATION LEAVE DONATION The HUC recognizes that a catastrophic illness and/or serious health condition of an employee or immediate family member (spouse or dependent child) may deplete an employee's available paid leave (sick/vacation/compensatory time). This policy is meant to provide employees with the option of assisting fellow employees at such a time. HUC employees having accrued sick or vacation leave shall be allowed to donate a portion of such accrued leave to fellow employees experiencing a catastrophic illness and/or serious health condition suffered by the employee, the employee's spouse, or the employee's dependent child(ren). A catastrophic illness and/or serious health condition includes but is not limited to, heart attack, stroke, organ transplant, or other life threatening illness or debilitating condition as defined by a physician's diagnosis. The donation of leave from one employee to another shall be subject to the following terms and conditions. 1. An employee is only eligible to receive donated leave for time lost from normal work hours due to a life threatening disease or condition as defined above. 2. An employee shall be eligible to receive donated leave only after the employee's accrued sick, vacation, and compensatory time have been exhausted. 3. All requests to receive donated leave must be in writing to human resources/payroll and must be accompanied by supporting medical data. No full time employee shall be allowed to receive more than a total of twenty (20) work days or 160 hours of donated leave per single major life threatening disease or condition unless requested and approved by the General Manager. There is no limit on catastrophic events per year. 4. An employee may only use donated leave up to the time of eligibility for a long-term disability benefit (if applicable), or for the maximum number of days allowed to be donated, whichever occurs first. 5. A full time employee may donate no more than sixteen (16) hours of leave per calendar year to a single fellow employee. This shall not be construed to prohibit donating sixteen (16) hours per year to additional employees. Leave donation shall be calculated using time and not an equivalent cash amount. 6. An employee who is donating paid leave must do so from the employee's accrued sick and/or vacation leave balance. A written request to donate leave must be made to human resources/payroll on forms designated by HUC for that purpose. All donations made shall be kept confidential. 7. The General Manager shall have the right to deny use of donated leave or limit its use if it is determined to be in the best interests of HUC. Donated leave shall be subtracted from the donor's accumulated balance and added to the requested employee as part of the payroll function. Donated time shall be processed and used by the date of submission until the eligible amount of donated leave is reached. Contributions of leave hours exceeding the eligible amount shall be returned to the donating employee, and shall not be transferred. Donated hours shall be used in the order they are received. TRAINING AND EDUCATION ASSISTANCE HUC encourages its employees to seek individual and career development through job -related training and education. HUC provides financial assistance for successful completion of qualifying programs and courses. Tuition, registration fees and other course -related fees would be reimbursed after successful completion of a course. To apply for education assistance, employees must submit a request to their Manager, or Supervisor no later than five working days prior to registration. The Manager or Supervisor and the General Manager must approve the course, seminar, or program. Only courses that are job -related and provide potential for career advancement with HUC are eligible for reimbursement. The following criteria must be met: The maximum amount of reimbursement will be $6,000 per calendar year. If coursework or tuition exceeds this amount, then the General Manager will approach the Commission to request a waiver. To request a waiver, the coursework must be directly related to the employee's position within the company, or if the degree the employee is seeking is beneficial to the company; in other words, it would be difficult to hire someone who already has that degree. Reimbursement is contingent on receiving a "pass" or minimum grade of "C". Employee must study on their own time. Use of HUC computers is allowed in accordance with the IT policy. An employee must remain employed at HUC for twenty-four (24) calendar months after completion of a course, or must repay HUC all reimbursements received for the course. WORKPLACE ACCOMMODATION HUC shall make workplace accommodations in accordance with state and federal law. An employee who believes he or she qualifies for a reasonable accommodation under the Americans with Disabilities Act (ADA) shall submit a request for accommodations to the General Manager. HUC shall engage in an interactive process with employees who request accommodation in order to identify the specific physical and mental abilities and limitations as they relate to essential job functions; barriers to the performance of essential job functions; and how these barriers could be overcome with reasonable accommodation. The employee may be requested to provide written documentation from a healthcare provider relating to the employee's medical condition and request for accommodation. If an employee refuses to provide such written documentation and/or sign an authorization allowing HUC to contact the healthcare provider, HUC will evaluate the employee's request based on the information available to HUC. HUC shall, in the process of evaluating potential accommodations, determine which, if any, potential accommodations present an undue hardship to HUC or the department in which the employee works. UNPAID EXTENDED LEAVE OF ABSENCE The General Manager may grant an employee's request for an extended leave of absence without pay. The unpaid leave of absence shall be a minimum length of one month and a maximum length of six months. Employees on an extended leave of absence for one month or longer which is not governed by the FMLA, are required to pay the full cost of any health, long-term disability or life insurance premium during the leave of the absence. Employees on unpaid leave of absence shall not earn vacation and sick leave. No employee shall be granted a leave of absence in order to accept a different position with another employer. Acceptance of a full-time position with another employer shall be deemed a resignation of the employee's position with RUC. FAMILY DEATH Employees may take a leave of absence with pay in the event of a death in the employee's immediate family. Time allowed with pay for exempt employees may not exceed five (5) days per family member. Employees may be allowed up to twenty (20) hours of paid leave for the employee's aunt or uncle. The paid time off will not be deducted from the employee's paid leave banks. If an employee is called to participate in the funeral services for the death of a person who is not a member of the employee's immediate family, an employee will receive four hours paid leave of absence. EMERGENCY LEAVE The General Manager may approve time off without pay to an employee who has no vacation or compensatory time available, if in the General Manager's discretion, the employee is experiencing an emergency requiring the employee's attention. MILITARY LEAVE HUC shall comply with Minnesota statutes relating to military leave. JURY, WITNESS OR BOARD DUTY A regular full-time and part-time employee called to jury duty will be granted paid leaves of absence. Employees are required to notify their supervisor as soon as possible after receiving notice to report for jury duty. Such employees will be required to turn over any compensation they receive for jury duty, minus mileage reimbursement, to HUC in order to receive their regular wages for the period. Time spent on jury duty will not be counted as time worked in computing overtime. Employees excused or released from jury duty during their regular working hours will report to their regular work duties as soon as reasonably possible or will take accrued vacation or compensatory time to make up the difference. Employees will be paid their regular wage to testify in court for HUC-related business or to serve on a work -related board or committee which pays a per diem. Any compensation received for court appearances (e.g. subpoena fees) or as meeting per diems arising out of or in connection with HUC employment, minus mileage reimbursement, must be turned over to HUC. VOLUNTEER FIRE OR RESCUE SQUAD DUTY In the event of an HUC emergency, the General Manager reserves the right to retain essential employees from Hutchinson volunteer fire or rescue squad duties or require employees to return to their HUC duties and assist the operation of HUC. HUC employees who are called out as members of the Hutchinson volunteer fire or rescue squad while on duty with HUC will be paid up to four hours regular pay while on the emergency call. SCHOOL CONFERENCE LEAVE Any employee who has worked half-time or more may take unpaid leave for up to a total of sixteen (16) hours during any 12-month period to attend school conferences or classroom activities related to the employee's child (under 18 or under 20 and still attending secondary school), provided the conference or school related activities cannot be scheduled during non - work hours. When the leave cannot be scheduled during non -work hours and the need for the leave is foreseeable, the employee must provide reasonable prior notice of the leave and make a reasonable effort to schedule the leave so as not to disrupt unduly the operations of HUC. Employees may choose to use vacation leave hours or compensatory time for this absence, but are not required to do so. BONE MARROW/ORGAN DONATION LEAVE Employees working an average of 20 or more hours per week must be granted paid leave, not to exceed 40 hours unless agreed to by HUC, to undergo medical procedures to donate bone marrow or to donate an organ or partial organ. HUC may require a physician's verification of the purpose and length of the leave requested. If there is a medical determination that the employee does not qualify as a bone marrow or organ donor, the paid leave of absence granted to the employee prior to that medical determination is not forfeited. RETIREMENT PROGRAM HUC is a member of the State Public Employees Retirement Association ("PERA") and also participates in the federal FICA (Social Security) program. Full-time employees must become members of PERA effective the date of employment. Both HUC and the employee contribute to PERA. Information on PERA is available from Human Resources. DEFERRED COMPENSATION HUC offers a 457 deferred compensation plan, which allows employees to place a portion of their earnings through payroll deduction into a tax deferred investment program. Taxes on money set aside are deferred until the time the money is withdrawn. HUC does not contribute to this 457 deferred compensation plan. For enrollment information, contact payroll. PERSONAL USE OF UTILITY FACILITIES AND EQUIPMENT No employee may use HUC facilities or equipment for personal use. RECOGNITION POLICY - SERVICE AWARDS AND RETIREMENT GIFTS Obiective Service awards and retirement gifts are provided to recognize and reward employees for service with the company. Awards are granted without regard to position or salary. Scope of Policy Full-time, active employees are eligible for a service award for every five (5) years of service completed. The service awards may increase in value based on longevity, per the table listed in Service Award Procedures below. Service Credit Service credit for service awards will count from the first day an individual is considered a full- time employee of HUC and continue while the employee remains on full-time, active status. If an individual has a break in service, their service credit may resume accumulating when they return to full-time status, depending on the nature of the break. Service Award Procedures HUC will inform the individual employee of their eligibility for a service award. Eligible employees may select a gift card in the amount noted on the table below. Employee will receive a Certificate of Appreciation signed by the General Manager and presented to them at the Recognition Banquet. Gift cards must be for personal, tangible property and may not be redeemed for cash. Amount Years of Service $50 5 Years $100 10 Years $125 15 Years $150 20 Years $175 25 Years $200 30 Years $250 35 Years $300 40 Years Retirement Recognition Procedures Retirees have the option of a potluck luncheon in their honor. A gift from HUC valued at no greater than $300 will be given to the retiree. The immediate supervisor will be responsible for coordinating the purchase of the gift. NON-EXEMPT VACATION See Union Contract. HOLIDAYS Employees are eligible for holiday pay effective immediately upon hire. HUC shall observe the following days as holidays: • New Year's Day • Martin Luther King Day • President's Day • Memorial Day • Juneteenth • Fourth of July • Labor Day • Veteran's Day • Thanksgiving Day • Christmas Day If the holiday falls on a Sunday, the following Monday shall be the holiday. If the holiday falls on a Saturday, the preceding Friday shall be the holiday. If Christmas falls on a Tuesday, Wednesday, Thursday or Friday, then the preceding day shall be a Christmas Eve Day holiday. Additionally, there shall be two (2) floating holidays determined by mutual agreement between the employee and or Manager. If Christmas falls on a Saturday, Sunday, or Monday, there shall be no Christmas Eve Day holiday but there shall be three (3) floating holidays determined by mutual agreement between the employee and or Manager. Floating holidays must be used by the end of each calendar year. Employees shall be paid eight (8) hours straight time for each of the holidays. However, those employees governed by the Memorandum of Agreement, must comply with section 13.2 of that Agreement. Temporary employees who work on a holiday shall be paid at the employee's regular base pay rate and shall not receive holiday pay for hours not worked. LIFE INSURANCE HUC provides group term life insurance with accidental death and dismemberment for all full- time employees. HUC also offers voluntary term life insurance for all full-time employees. Information on life insurance is available through human resources/payroll. HEALTH/DENTAL INSURANCE HUC provides an opportunity for employees to participate in a group (HSA)/dental insurance program. Employees are eligible for coverage the first of the month following hire date. Contact human resources/payroll for information regarding benefits and participation levels. Contact human resources/payroll for information about continuation of health/dental insurance coverage after leaving. See Union Contract. DISABILITY INSURANCE HUC pays the entire premium of a long-term disability insurance policy for all employees. Information on disability insurance is available through human resources/payroll. FAMILY AND MEDICAL LEAVE (FMLA) Pursuant to the Family and Medical Leave Act, employees are allowed up to 12 weeks unpaid leave during a 12-month period for the following reasons: • Birth or care of the newborn child of the employee • Placement with the employee of a child for adoption or foster care • Serious health condition of the employee that makes the employee unable to perform the functions of the position of such employee • In order to care for an employee's dependent child, spouse, or parent suffering from a serious health condition • Any qualifying exigency arising out of the fact that the spouse, or a son, daughter or parent of the employee is on active duty, or has been notified of an impending call or order to active duty) in the Armed Forces in support of a contingency operation. Up to twenty-six (26) weeks of protected leave per twelve (12) month period shall be granted to all eligible employees for the following reasons: • An eligible employee who is the spouse, son, daughter, parent, or next of kin of a covered service member shall be entitled to a total of 26 workweeks of leave during a twelve (12) month period to care for the service member. The leave described in this paragraph shall only be available during a single twelve (12) month period. • A covered service member is defined as a member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness. The term "serious injury or illness", in the case of a member of the Armed Forces, including a member of the National Guard or Reserves, means an injury or illness incurred by the member in the line of duty on active duty in the Armed Forces that may render the member medically unfit to perform the duties of the member's office, grade, rank, or rating. Spouses employed by HUC, both in regular positions, are jointly entitled to a combined total of 12 work weeks of family leave for the birth and care of a newborn child, for placement of a child for adoption or foster care, and to care for a parent who has a serious health condition. Spouses are entitled to a combined total of 26 weeks during a single twelve (12) month period to care for an eligible service member. During the single twelve (12) month period, an eligible employee shall be entitled to a combined total of 26 work weeks of total leave allowed under the FMLA. To be eligible for FMLA leave, the employee must have worked at least one year for HUC and worked at least 1,040 hours during the previous 12 months. In order to receive FMLA leave, the employee must request the leave by providing human resources/payroll 30-day's notice prior to the requested starting date of the leave. If 30-day's notice is not possible, the employee must provide as much notice as possible. Human resources/payroll shall provide the employee a "Medical Certificate" which must be completed by the employee's physician and returned to human resources/payroll. Pursuant to the FMLA, HUC may request a second opinion from another medical provider at HUC's expense. If the second opinion is different from the employee's physician's opinion, HUC shall seek a third opinion at HUC's expense. The third opinion shall prevail. HUC may require that a request for leave related to active duty or call to active duty be supported by a certification issued by the health care provider of the service member being cared for by the employee. The 12 weeks of available FMLA leave extend over 12 months. To determine whether the employee has any FMLA leave remaining, human resources/payroll shall review the 12 months preceding the request for FMLA leave. An employee may use the 12 weeks of FMLA leave intermittently over the 12-month period if necessary and may take the leave in increments of one hour or more. HUC may require a medical certificate attesting to the employee's fitness for duty prior to return to work. The fitness for duty report must be based on the particular health condition(s) for which the leave was approved and must address whether the employee can perform the essential functions of his/her regular position. An employee on FMLA leave for serious illness of the employee, the employee's spouse, dependent child or parent shall be required to use vacation or sick leave concurrent with the FMLA leave. HUC shall continue to pay its contribution toward health and dental insurance while an employee is on FMLA leave. The employee shall be required to continue payment of the employee portion of the premiums during the leave. If the employee fails to pay their portion of the premiums, HUC may terminate their insurance coverage subject to COBRA requirements. At the end of FMLA leave, an employee shall be returned to his/her former position or an equivalent position. For more information on FMLA leave, see human resources/payroll. PREGNANCY AND PARENTING LEAVE Pursuant to the Minnesota Pregnancy and Parenting Act, all employees are entitled to take an unpaid leave of absence. Female employees are eligible for prenatal care, or incapacity due to pregnancy, childbirth, or related health conditions as well as a biological or adoptive parent in conjunction with the birth or adoption of a child are eligible for up to twelve (12) weeks of unpaid leave. Any paid or unpaid leave taken for prenatal care medical appointments will not count toward the 12-week leave. Additionally, leave under this section must begin within twelve (12) months of the birth or adoption of the child. In the case where the child must remain in the hospital longer than the mother, the leave must begin within twelve (12) months after the child leaves the hospital. Eligible employees should provide reasonable notice, which is at least thirty (30) days written notice to human resources/payroll of their desire to take parental leave. Employees may choose to use their paid leave banks, such as sick leave or vacation. If the employee is also eligible for FMLA leave, the pregnancy and parenting leave under this section and FMLA leave shall run concurrently. The employee is entitled to return to work in the same position and at the same rate of pay the employee was receiving prior to commencement of the leave. Group insurance coverage will remain available while the employee is on leave pursuant to the Pregnancy and Parenting Leave Act, but the employee will be responsible for the employee share of the premium unless otherwise provided in this policy (i.e., where leave is also FMLA qualifying). For employees on an FMLA leave absence as well, the employer contributions toward insurance benefits will continue during the FMLA leave absence. REASONABLE PAID WORK TIME FOR NURSING MOTHERS Nursing mothers will be provided reasonable paid break times to express milk for nursing her child for one year after the child's birth. HUC will provide a room (other than a bathroom) as close as possible to the employee's work area, that is shielded from view and free from intrusion from coworkers and the public and includes access to an electrical outlet, where the nursing mother can express milk in private. REASONABLE ACCOMMODATIONS TO AN EMPLOYEE FOR HEALTH CONDITIONS RELATING TO PREGNANCY HUC will attempt to provide a female employee who requests reasonable accommodation with the following for her health conditions related to her pregnancy or childbirth. Without advice of a licensed health care provider or certified doula: More frequent restroom, food and water breaks; Seating; and/or Limits on lifting over 20 pounds and/or Additionally, an employer must provide reasonable accommodations, including, but not limited to, temporary leaves of absence, modification in work schedule or job assignments, seating, more frequent or longer break periods and limits to heavy lifting to an employee for health conditions related to pregnancy or childbirth upon request, with the advice of a licensed health care provider or certified doula, unless the employer demonstrates the accommodation would impose an undue hardship on the operation of the employer's business. In accordance with state law, no employee is required to take a leave of absence for a pregnancy nor accept a pregnancy accommodation. An employer shall not discharge, discipline, penalize, interfere with, or otherwise retaliate or discriminate against an employee for asserting reasonable accommodations pregnancy rights or remedies SICK LEAVE 1. Sick leave shall be granted to all probationary and non -probationary employees at a rate of eight (8) hours per month. 2. Sick leave may be granted for absence from duty due to personal illness, or for the illness of an immediate family (See Definitions) member on the same terms the employee is able to use sick leave benefits for their own illness, including appointments for necessary medical, dental or eye care, legal quarantine, or brief emergency situation (not to exceed one day) in the immediate family (See Definitions). 3. Sick leave cannot be accumulated beyond 720 hours. After the accumulation of 720 hours, a payback of one-half of the amount over 720 hours shall be made annually on or about February 1. This will be deposited in the Health Care Savings Plan (HCSP). 4. Upon retirement or death before retirement, a payback of one-third of any unused sick leave which has been accumulated shall be made. If the employee resigns or is dismissed, the above payment shall not be made. In case of death during employment, the unused sick leave shall be paid to his/her estate on the same percentage as above. This will be deposited in the Health Care Savings Plan (HCSP). 5. Requests for sick leave consideration in case of other emergency situations may be brought to the Manager or Supervisor. 6. A maximum of five days funeral leave may be allowed when necessary in the case of death in the immediate family (See Definitions). 7. If an employee becomes ill and must stay home from work, he/she shall notify their Manager or Supervisor before their work day begins. 8. If an employee becomes ill during his/her regular work day, they shall notify their Manager or Supervisor that it is necessary to leave due to illness. 9. Employees may be required to submit a medical certificate for any sick leave, at the discretion of the Manager or Supervisor. 10. The use or claim of sick leave for apurpose not authorized may be cause for disciplinary action. 11. For the purpose of accumulating additional vacation or sick leave, an employee using earned vacation or sick leave is considered to be in a paid or working status. 12. Employees that are injured while engaged in after hours' employment of others or while self employed, shall not be covered under HUC's Sick Leave Policy, or Worker's Compensation benefits. 13. An employee who is determined to be eligible for workers compensation benefits during absence from duty shall receive such benefits pursuant to "Worker's Compensation" in the Employee Handbook. 14. HUC shall comply with the Family and Medical Leave Act, the Minnesota Parental Leave Act and the Americans with Disabilities Act. 15. Safety leave. Employees are authorized to use sick leave for reasonable absences for themselves or immediate family (See Definitions) who are providing or receiving assistance because they, or a relative, is a victim of sexual assault, domestic abuse, or stalking. Safety leave for those listed, other than the employee and the employee's child, is limited to 160 hours in any calendar year. After accrued sick leave has been exhausted, vacation leave may be used upon approval of the General Manager, to the extent the employee is entitled to such leave. EARNED SICK AND SAFE LEAVE This Policy defines Hutchinson Utilities' compliance with the Minnesota Earned Sick and Safe Time (ESST) law outlined in Minnesota Statutes, §§ 181.9445 to 181.9448, effective January 1, 2024. Earned Sick and Safe Leave (ESST) is paid leave employers must provide to employees in Minnesota that can be used for certain reasons. The hourly rate of paid ESST is the same hourly rate an employee earns from employment with Hutchinson Utilities. This ESST Policy applies to employees who work in the State of Minnesota as an employee of the County for at least eighty (80) hours in a year, including seasonal, temporary, on -call, casual employees; and all full-time and part-time employees. For purposes of ESST compliance, the leave year is defined as the calendar year — January 1 through December 31. FOR FULL-TIME EMPLOYEES: For purposes of satisfying ESST, Hutchinson Utilities has previously negotiated or provided to employees paid vacation and sick leave which meets or exceed ESST minimum requirements under the law. The first 48 hours of paid vacation/sick leave used will be cross -designated as ESST. If the employee chooses to use paid vacation/sick leave for reasons other than those outlined in this policy as ESST eligible hours, the employee will not be provided with additional ESST hours. While an employee may use paid vacation/sick leave hours for an ESST purpose, the employee will not be provided with additional ESST hours once available hours have been exhausted. Once an employee has used their yearly 48 hours of ESST (or up to a maximum of 80 hours if an employee has any ESST carry over from prior years), none of their remaining vacation/sick leave they subsequently accrue or use in that year will be designated as ESST. Accordingly, the provisions of Minn. Stat. §§ 181.9445 — 181.9448 or this policy do not apply to paid vacation/sick leave taken after an employee has used their yearly ESST entitlement. FOR SEASONAL EMPLOYEES: All seasonal employees are eligible to earn ESST when at least 80 hours of work are performed in a calendar year (January 1 — December 31). An employee who works at least 80 hours in a calendar year will earn one (1) hour of ESST leave for every 30 hours worked, up to a maximum accrual of 48 hours per calendar year. Employees begin accruing ESST on their first day of employment. Employees may roll over unused ESST to the next year up to a maximum accrual of 80 ESST hours. For the purposes of this policy, ESST leave used by an employee does not count towards hours worked. Accrued and unused ESST will not be paid out to seasonal employees upon separation from employment. Earned Sick and Safe Leave Use The leave may be used as it is accrued in the smallest increment of time tracked by the employer's payroll system and may be used for the following circumstances: • An employee's own: o Mental or physical illness, injury or other health condition o Need for medical diagnosis, care or treatment, of a mental or physical illness o injury or health condition o Need for preventative care o Closure of the employee's place of business due to weather or other public emergency o The employee's inability to work or telework because the employee is prohibited from working by the city due to health concerns related to the potential transmission of a communicable illness related to a public emergency, or seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, a communicable disease related to a public emergency and the employee has been exposed to a communicable disease or the city has requested a test or diagnosis. o Absence due to domestic abuse, sexual assault, or stalking of the employee provided the absence is to: ■ Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking ■ Obtain services from a victim services organization ■ Obtain psychological or other counseling ■ Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking ■ Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking o Care of a family member: o With mental or physical illness, injury or other health condition Who needs medical diagnosis, care or treatment of a mental or physical illness, injury or other health condition Who needs preventative medical or health care Whose school or place of care has been closed due to weather or other public emergency When it has been determined by health authority or a health care professional that the presence of the family member of the employee in the community would jeopardize the health of others because of the exposure of the family member of the employee to a communicable disease, whether or not the family member has actually contracted the communicable disease o Absence due to domestic abuse, sexual assault or stalking of the employee's family member provided the absence is to: ■ Seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking Obtain services from a victim services organization ■ Obtain psychological or other counseling ■ Seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault or stalking ■ Seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking For Earned Sick and Safe Leave burnoses_ family member includes an emblovee's: • Spouse or registered domestic partner • Child, foster child, adult child, legal ward, child for whom the employee is legal guardian, or child to whom the employee stands or stood in loco parentis • Sibling, step sibling or foster sibling • Biological, adoptive or foster parent, stepparent or a person who stood in loco parentis when the employee was a minor child • Grandchild, foster grandchild or step grandchild • Grandparent or step grandparent • A child of a sibling of the employee • A sibling of the parent of the employee or • A child -in-law or sibling -in-law • Any of the above family members of a spouse or registered domestic partner • Any other individual related by blood or whose close association with the employee is the equivalent of a family relationship • Up to one individual annually designated by the employee Advance Notice for use of Earned Sick and Safe Leave If the need for sick and safe leave is foreseeable, HUC requires seven days' advance notice. However, if the need is unforeseeable, employees must provide notice of the need for Earned Sick and Safe time as soon as practicable. When an employee uses Earned Sick and Safe time for more than three consecutive days, HUC may require appropriate supporting documentation (such as medical documentation supporting medical leave, court records or related documentation to support safety leave). However, if the employee or employee's family member did not receive services from a health care professional, or if documentation cannot be obtained from a health care professional in a reasonable time or without added expense, then reasonable documentation may include a written statement from the employee indicating that the employee is using, or used, Earned Sick and Safe Leave for a qualifying purpose. HUC will not require an employee to disclose details related to domestic abuse, sexual assault, or stalking or the details of the employee's or the employee's family member's medical condition. In accordance with state law, HUC will not require an employee using Earned Sick and Safe leave to find a replacement worker to cover the hours the employee will be absent. Retaliation prohibited HUC shall not discharge, discipline, penalize, interfere with, or otherwise retaliate or discriminate against an employee for asserting Earned Sick and Safe Leave rights, requesting an Earned Sick and Safe Leave absence, or pursuing remedies. Additionally, it is unlawful to report or threaten to report a person or a family member's immigration status for exercising a right under Earned Sick and Safe Leave. Any employee who believes that they have been wrongfully denied ESST, retaliated, or discriminated against for requesting or using ESST must immediately notify Human Resources. The use of ESST will not be factored into any attendance point system the Utility may use. An employee has the right to file a complaint or bring a civil action if ESST is denied by the Utility or if the employee is retaliated against for requesting or using ESST. An employee injured by a violation of this policy pursuant to sections §§ 181.9445 - 181.9448 may file a complaint with the Minnesota Department of Labor and Industry and bring a civil action to recover any and all damages recoverable by law. Questions regarding ESST or this policy should be directed to Human Resources. Employees may contact the Minnesota Department of Labor and Industry's Labor Standards Division at 651-284- . a s (i),state.mn.�us or visit the department's earned sick and safe time 5075 or ..... l ............ webpage at 1..:.��n..:.aoy/sick....ieave. Benefits and return to work protections During an employee's use of Earned Sick and Safe Leave, an employee will continue to receive HUC's employer insurance contribution as if they were working, and the employee will be responsible for any share of their insurance premiums. An employee returning from time off using accrued Earned Sick and Safe Leave is entitled to return to their HUC employment at the same rate of pay received when their leave began, plus any automatic pay adjustments that may have occurred during the employee's time off. Seniority during Earned Sick and Safe Leave absences will continue to accrue as if the employee has been continually employed. When there is a separation from employment with HUC and the employee is rehired again within 180 days of separation, previously accrued Earned Sick and Safe Leave that had not been used will be reinstated. An employee is entitled to use and accrue Earned Sick and Safe Leave at the commencement of reemployment. Disclaimer This policy is not a contract for employment. The Utility periodically may update this policy and reserves the right to interpret the policy as well as replace, modify, or revoke it at any time, upon reasonable notice. MINNESOTA PAID LEAVE HUC provides time off to eligible employees who qualify for Minnesota Paid Leave (MNPL) benefits under Minnesota law. HUC is a participant in an equivalent plan through an approved private insurance carrier. MNPL benefits are funded through premium contributions payable to the equivalent plan through an approved private insurance carrier. The premium cost will be split between HUC and employees as follows: HUC will pay 50% of the required premium and employees will pay 50% of the premium cost through payroll deductions starting January 1, 2026. ELIGIBILITY: Eligibility determinations for MNPL benefits are made by the approved private insurance carrier. Generally, to be eligible for MNPL, the employee must: • Work at least 50% of the time from a location in Minnesota, including employees who work from home or spend time in other states occasionally. • Meet the financial eligibility requirements by having earned over a specific amount of wages as defined by Minnesota law at the time of the requested leave. BENEFIT AMOUNT: HUC does not determine eligibility or benefit amount. Benefit amount is determined by the approved private insurance carrier. LEAVE ENTITLEMENT AND USAGE: The approved private insurance carrier may approve MNPL leave for the following conditions in a benefit year: • Up to 12 weeks of medical leave (for yourself) to take care of yourself for a serious health condition, including pregnancy, childbirth, recovery, or surgery. • Up to 12 weeks of family leave to: o Bond with a child through birth, adoption, or foster placement within 12 months of birth or placement of a child o Care for a family member with a serious health condition o Support a military family member called to active duty o Receive covered types of care for yourself or a family member because of domestic abuse, sexual assault, or stalking You can take both types of leave in the same year, but you cannot exceed 20 weeks total within a single benefit year. For example, an employee may be entitled to 12 weeks of family leave to bond with a child and another 8 weeks of medical leave for their serious health condition. Benefit year starts the first day Paid Leave is taken. There is no waiting period for MNPL if MNPL is granted. MNPL INTERMITTENT LEAVE: Employees may apply for intermittent leave in most cases, provided the leave is reasonable and appropriate to the needs of the individual requiring care. D. Eligibility In addition to the other eligibility requirements under the MN Paid Leave law, employees seeking intermittent leave must have at least eight hours of accumulated leave (unless more than 30 days have lapsed since taking the initial leave). E. Notice In situations where employees seek MNPL on an intermittent basis, employees must make a reasonable effort to provide written notice to HUC Admin/HR Coordinator of the need for intermittent leave before applying for MNPL benefits through the approved private insurance carrier. As part of the notice, employees must provide HUC with the following: 1. proposed intermittent leave schedule; and 2. a completed certification from a health care provider identifying the leave as necessary and a reasonable estimate of the frequency, duration, and treatment schedule for the leave. F. Increments of Leave & Maximum Number of Hours Consistent with other forms of leave provided by HUC, employees may take intermittent leave in increments of .25 hours. If eligible for intermittent leave, HUC allows a maximum of 480 hours of intermittent leave in any 12-month period. After reaching the maximum amount of allowed intermittent leave, employees may request continuous MNPL provided the continuous leave does not exceed the maximum amount of MNPL allowed by law. DEFINITIONS: • Family member c•7 Spouse or partner • Child (including biological, adopted, step, or foster children, or a child you raise even if you are not legally related) r:> Parent or person who raised you o Sibling r:> Grandchild or Grandparent r:> In-laws (including son, daughter, father, or mother) o Anyone close to you who depends on you like family, even if not related by blood. • A Serious health condition means a physical or mental illness, injury, impairment, condition, or substance use disorder. Taking care of yourself for this serious condition may involve evaluation, treatment, inpatient care, recovery, or not being able to perform regular work, attend school, or do regular daily activities. This includes childbirth, conditions related to pregnancy, or surgery. Please see Admin/HR Coordinator for more information regarding a serious health condition. NOTICE: Prior to starting a claim with the equivalent plan through an approved private insurance carrier, employees should reach out to HR to notify the intention to take leave. If the need is foreseeable, HUC asks that the employee provide at least 2 weeks' notice prior to taking leave. If the leave is not foreseeable the employee will still be able to take leave under MNPL. HUC asks that the employee provide as much notice as possible. HOW TO APPLY FOR MINNESOTA PAID LEAVE: After leave has been discussed with HR/Admin Coordinator, employee may apply for MNPL through the equivalent plan that HUC has received approval on from the State. Please see Admin/HR Coordinator for more information regarding where to apply. INTERACTION WITH OTHER LAWS AND BENEFITS: MNPL will run concurrently with any leave and/or wage supplement for which you may be eligible for under local, state, or federal law which may include: FMLA and Pregnancy and Parenting Leave. SUPPLEMENTING MNPL BENEFITS WITH ACCRUED PAID LEAVE: If receiving MNPL benefits, HUC allows the employee to supplement, or "top off," MNPL benefits with any accrued but unused paid leave. If an employee chooses to supplement MNPL benefits in this way, the combined weekly sum of MNPL benefits and HUC paid leave benefits cannot exceed the employees' Individual Average Weekly Wage (IAWW). For more information contact Admin/HR Coordinator. MAINTAINING HEALTH COVERAGE DURING LEAVE: Unless the employee revokes coverage while on MNPL, HUC will continue to provide group health insurance coverage for an employee on MNPL under the same conditions as the coverage was provided before the employee took leave. The employee must continue to make timely payments for his/her share of the premiums for such coverage. If the employee is not using paid time off to cover part or all the leave, the employee will be responsible for remitting his/her portion of health premiums to HUC in order to ensure continuation of benefits. Group health insurance may be cancelled if an employee's premium payment is 30 days late. Before terminating coverage, HUC will provide written notice to the employee at least 15 days before the coverage is terminated listing the final date payment is due (30 days past the due date) to avoid cancellation and the date coverage will end if payment is not received. An employee's share of premium payments for his/her group health insurance coverage may, at the employee's option, be: 1. Prepaid at or before the start of the leave in which his/her health deductions may be modified to accept the agreed upon amounts and frequency of premium deductions; 2. Arranged to write a check every 2-4 weeks for the duration that the employee may be out; 3. Be postpaid after the leave ended in which his/her health deductions may be modified to accept the agreed upon amounts and frequency of premium deductions. Coverage that lapses due to nonpayment of premiums will be reinstated immediately upon return to work without a waiting period. REINSTATEMENT: Upon return from covered MNPL, the employee will be reinstated to his/her previous position or to an equivalent position, with the same status, pay, employment benefits, length -of service credit, and seniority credit as of the date of leave as long as he/she has worked for HUC for a minimum of 90 calendar days. Upon return to work, if it becomes evident that the employee is unable to perform the key essential functions of his/her position (with or without reasonable accommodation), HUC may engage in an interactive process, consistent with the American with Disability Act (ADA) and/or Minnesota Human Rights Act (MHRA) and other applicable workplace policies, including workplace safety protocols, to determine appropriate next steps. RETALIATION: HUC will not interfere or retaliate against employees who request or take leave in accordance with the MN Paid Leave law. Disclaimer This policy is not a contract for employment. The Utility periodically may update this policy and reserves the right to interpret the policy as well as replace, modify, or revoke it at any time, upon reasonable notice. SICKNACATION LEAVE DONATION The HUC recognizes that a catastrophic illness and/or serious health condition of an employee or immediate family member (spouse or dependent child) may deplete an employee's available paid leave (sick/vacation/compensatory time). This policy is meant to provide employees with the option of assisting fellow employees at such a time. HUC employees having accrued sick or vacation leave shall be allowed to donate a portion of such accrued leave to fellow employees experiencing a catastrophic illness and/or serious health condition suffered by the employee, the employee's spouse, or the employee's dependent child(ren). A catastrophic illness and/or serious health condition includes but is not limited to, heart attack, stroke, organ transplant, or other life threatening illness or debilitating condition as defined by a physician's diagnosis. The donation of leave from one employee to another shall be subject to the following terms and conditions. 1. An employee is only eligible to receive donated leave for time lost from normal work hours due to a life threatening disease or condition as defined above. 2. An employee shall be eligible to receive donated leave only after the employee's accrued sick, vacation, and compensatory time have been exhausted. 3. All requests to receive donated leave must be in writing to human resources/payroll and must be accompanied by supporting medical data. No full time employee shall be allowed to receive more than a total of twenty (20) work days or 160 hours of donated leave per single major life threatening disease or condition unless requested and approved by the General Manager. There is no limit on catastrophic events per year. 4. An employee may only use donated leave up to the time of eligibility for a long-term disability benefit (if applicable), or for the maximum number of days allowed to be donated, whichever occurs first. 5. A full time employee may donate no more than sixteen (16) hours of leave per calendar year to a single fellow employee. This shall not be construed to prohibit donating sixteen (16) hours per year to additional employees. Leave donation shall be calculated using time and not an equivalent cash amount. 6. An employee who is donating paid leave must do so from the employee's accrued sick and/or vacation leave balance. A written request to donate leave must be made to human resources/payroll on forms designated by HUC for that purpose. All donations made shall be kept confidential. 7. The General Manager shall have the right to deny use of donated leave or limit its use if it is determined to be in the best interests of HUC. Donated leave shall be subtracted from the donor's accumulated balance and added to the requested employee as part of the payroll function. Donated time shall be processed and used by the date of submission until the eligible amount of donated leave is reached. Contributions of leave hours exceeding the eligible amount shall be returned to the donating employee, and shall not be transferred. Donated hours shall be used in the order they are received. TRAINING AND EDUCATION ASSISTANCE HUC encourages its employees to seek individual and career development through job -related training and education. HUC provides financial assistance for successful completion of qualifying programs and courses. Tuition, registration fees and other course -related fees would be reimbursed after successful completion of a course. To apply for education assistance, employees must submit a request to their Manager, or Supervisor no later than five working days prior to registration. The Manager or Supervisor and the General Manager must approve the course, seminar, or program. Only courses that are job -related and provide potential for career advancement with HUC are eligible for reimbursement. The following criteria must be met: The maximum amount of reimbursement will be $6,000 per calendar year. If coursework or tuition exceeds this amount, then the General Manager will approach the Commission to request a waiver. To request a waiver, the coursework must be directly related to the employee's position within the company, or if the degree the employee is seeking is beneficial to the company; in other words, it would be difficult to hire someone who already has that degree. Reimbursement is contingent on receiving a "pass" or minimum grade of "C". Employee must study on their own time. Use of HUC computers is allowed in accordance with the IT policy. An employee must remain employed at HUC for twenty-four (24) calendar months after completion of a course, or must repay HUC all reimbursements received for the course. WORKPLACE ACCOMMODATION HUC shall make workplace accommodations in accordance with state and federal law. An employee who believes he or she qualifies for a reasonable accommodation under the Americans with Disabilities Act (ADA) shall submit a request for accommodations to the General Manager. HUC shall engage in an interactive process with employees who request accommodation in order to identify the specific physical and mental abilities and limitations as they relate to essential job functions; barriers to the performance of essential job functions; and how these barriers could be overcome with reasonable accommodation. The employee may be requested to provide written documentation from a healthcare provider relating to the employee's medical condition and request for accommodation. If an employee refuses to provide such written documentation and/or sign an authorization allowing HUC to contact the healthcare provider, HUC will evaluate the employee's request based on the information available to HUC. HUC shall, in the process of evaluating potential accommodations, determine which, if any, potential accommodations present an undue hardship to HUC or the department in which the employee works. UNPAID EXTENDED LEAVE OF ABSENCE The General Manager may grant an employee's request for an extended leave of absence without pay. The unpaid leave of absence shall be a minimum length of one month and a maximum length of six months. Employees on an extended leave of absence for one month or longer which is not governed by the FMLA, are required to pay the full cost of any health, long-term disability or life insurance premium during the leave of the absence. Employees on unpaid leave of absence shall not earn vacation and sick leave. No employee shall be granted a leave of absence in order to accept a different position with another employer. Acceptance of a full-time position with another employer shall be deemed a resignation of the employee's position with RUC. FAMILY DEATH See Union Contract. EMERGENCY LEAVE The General Manager may approve time off without pay to an employee who has no vacation or compensatory time available, if in the General Manager's discretion, the employee is experiencing an emergency requiring the employee's attention. MILITARY LEAVE HUC shall comply with Minnesota statutes relating to military leave. JURY, WITNESS OR BOARD DUTY A regular full-time and part-time employee called to jury duty will be granted paid leaves of absence. Employees are required to notify their supervisor as soon as possible after receiving notice to report for jury duty. Such employees will be required to turn over any compensation they receive for jury duty, minus mileage reimbursement, to HUC in order to receive their regular wages for the period. Time spent on jury duty will not be counted as time worked in computing overtime. Employees excused or released from jury duty during their regular working hours will report to their regular work duties as soon as reasonably possible or will take accrued vacation or compensatory time to make up the difference. Employees will be paid their regular wage to testify in court for HUC-related business or to serve on a work -related board or committee which pays a per diem. Any compensation received for court appearances (e.g. subpoena fees) or as meeting per diems arising out of or in connection with HUC employment, minus mileage reimbursement, must be turned over to HUC. VOLUNTEER FIRE OR RESCUE SQUAD DUTY In the event of an HUC emergency, the General Manager reserves the right to retain essential employees from Hutchinson volunteer fire or rescue squad duties or require employees to return to their HUC duties and assist the operation of HUC. HUC employees who are called out as members of the Hutchinson volunteer fire or rescue squad while on duty with HUC will be paid up to four hours regular pay while on the emergency call. SCHOOL CONFERENCE LEAVE Any employee who has worked half-time or more may take unpaid leave for up to a total of sixteen (16) hours during any 12-month period to attend school conferences or classroom activities related to the employee's child (under 18 or under 20 and still attending secondary school), provided the conference or school related activities cannot be scheduled during non - work hours. When the leave cannot be scheduled during non -work hours and the need for the leave is foreseeable, the employee must provide reasonable prior notice of the leave and make a reasonable effort to schedule the leave so as not to disrupt unduly the operations of HUC. Employees may choose to use vacation leave hours or compensatory time for this absence, but are not required to do so. BONE MARROW/ORGAN DONATION LEAVE Employees working an average of 20 or more hours per week must be granted paid leave, not to exceed 40 hours unless agreed to by HUC, to undergo medical procedures to donate bone marrow or to donate an organ or partial organ. HUC may require a physician's verification of the purpose and length of the leave requested. If there is a medical determination that the employee does not qualify as a bone marrow or organ donor, the paid leave of absence granted to the employee prior to that medical determination is not forfeited. RETIREMENT PROGRAM HUC is a member of the State Public Employees Retirement Association ("PERA") and also participates in the federal FICA (Social Security) program. Full-time employees must become members of PERA effective the date of employment. Both HUC and the employee contribute to PERA. Information on PERA is available from Human Resources. DEFERRED COMPENSATION HUC offers a 457 deferred compensation plan, which allows employees to place a portion of their earnings through payroll deduction into a tax deferred investment program. Taxes on money set aside are deferred until the time the money is withdrawn. HUC does not contribute to this 457 deferred compensation plan. For enrollment information, contact payroll. PERSONAL USE OF UTILITY FACILITIES AND EQUIPMENT No employee may use HUC facilities or equipment for personal use. REQUIRED CLOTHING HUC will provide employees required uniforms and safety clothing at no cost to the employee. This clothing may differ by Department. See Staff Personnel for a list of the clothing HUC will provide to those employees. All clothing issued to employees by HUC may only be worn while the employee is on -duty for HUC. Failure to wear flame resistant clothing at the appropriate times is a violation of HUC policy and will subject the employee to discipline. SMALL HAND TOOLS RUC shall furnish the hand tools specified by the Manager as necessary to perform the employee's job duties. HUC will replace any small tools damaged or broken on the job. The damaged hand tool must be turned into the employee's Manager. It is the responsibility of the employee to replace any missing hand tools. RECOGNITION POLICY — SERVICE AWARDS AND RETIREMENT GIFTS Obiective Service awards and retirement gifts are provided to recognize and reward employees for service with the company. Awards are granted without regard to position or salary. Scope of Policy Full-time, active employees are eligible for a service award for every five (5) years of service completed. The service awards may increase in value based on longevity, per the table listed in Service Award Procedures below. Service Credit Service credit for service awards will count from the first day an individual is considered a full- time employee of HUC and continue while the employee remains on full-time, active status. If an individual has a break in service, their service credit may resume accumulating when they return to full-time status, depending on the nature of the break. Service Award Procedures HUC will inform the individual employee of their eligibility for a service award. Eligible employees may select a gift card in the amount noted on the table below. Employee will receive a Certificate of Appreciation signed by the General Manager and presented to them at the Recognition Banquet. Gift cards must be for personal, tangible property and may not be redeemed for cash. Amount Years of Service $50 5 Years $100 10 Years $125 15 Years $150 20 Years $175 25 Years $200 30 Years $250 35 Years $300 40 Years Retirement Recognition Procedures Retirees have the option of a potluck luncheon in their honor. A gift from HUC valued at no greater than $300 will be given to the retiree. The immediate supervisor will be responsible for coordinating the purchase of the gift. HUTCHINSON UTILITIES COMMISSION ^I'�xP61Tti'°" Board Action Form Agenda Item: Approve Natural Gas Chain of Custody Agreement with 3M Presenter: Byron Bettenhausen Agenda Item Type: Time Requested (Minutes): 5 New Business Attachments: Yes BACKGROUND/EXPLANATION OFAGENDA ITEM: HUC needs to put in place a Custody Transfer Agreement with 3M to delineate the custody transfer point of infrastructure by each party located at each meter set. In addition, this agreement ensures both parties acknowledge the responsibilities set forth for the ownership, maintenance, measuring and monitoring of the natural gas facilities. BOARD ACTION REQUESTED: Approve Chain of Custody Agreement Fiscal Impact: 0 Included in current budget: No El Budget Change: No PROJECT SECTION: Total Project Cost: 0 Remaining Cost: CHAIN OF CUSTODY AGREEMENT FOR NATURAL GAS PIPELINE TRANSFER This Chain of Custody Agreement ("Agreement") is entered into as of ("Effective Date"), by and between: Hutchinson Utilities Commission (HUC), ("Upstream Party") and 3M Company, (`"Downstream Party"), collectively referred to as the "Parties." 1. PURPOSE The purpose of this Agreement is to define the point at which custody, ownership, control, and liability for natural gas transfers from HUC to 3M. 2. DEFINITIONS • Custody Transfer Point (CTP): The physical location where ownership and responsibility for the natural gas transfers between Parties. • Gas: Natural gas delivered through the pipeline system to the 3M facility. • Measurement Equipment: Metering, regulation, and associated instrumentation used to quantify gas flow. • Meter Set: Each individual metering installation where gas is measured and delivered to 3M. 3. CUSTODY TRANSFER POINT Custody transfer shall occur at each meter set at the following defined point: Custody Transfer Point Definition: For each meter set, the Custody Transfer Point shall be the downstream flange of the custody transfer meter. At this point: • Ownership of the gas transfers from HUC to 3M • All risk of loss transfers from HUC to 3M • Operational control and responsibility transition to 3M downstream of this point 4. OWNERSHIP AND RESPONSIBILITY 4.1 HUC Responsibilities (Upstream) HUC shall: • Own, operate, and maintain all facilities upstream of the Custody Transfer Point at each meter set • Ensure delivered gas meets agreed quality specifications prior to transfer • Retain all risk, loss, and liability for gas prior to the CTP 4.2 3M Responsibilities (Downstream) 3M shall: • Assume full ownership, control, and responsibility for gas upon passing the CTP at each meter set • Own, operate, and maintain all facilities downstream of the Custody Transfer Point • Assume all risk, loss, and liability for gas after the CTP 5. MEASUREMENT AND METERING • Gas volumes shall be measured using metering equipment located at each meter set. HUC shall be responsible for operation and maintenance of the primary metering equipment unless otherwise agreed. • Calibration and verification shall be performed at mutually agreed intervals, with 3M having the right to witness testing. • In the event of meter failure, volumes shall be determined using best available data and accepted industry estimation methods. 6. LIABILITY AND RISK • Risk of loss transfers at the Custody Transfer Point at each meter set. • Each Party shall be responsible for damages, losses, or incidents arising from its respective facilities. Each Party agrees to indemnify and hold harmless the other from claims resulting from its negligence or failure to meet obligations under this Agreement. 7. ACCESS AND INSPECTION • 3M shall have reasonable access to each Custody Transfer Point for inspection and verification of measurement equipment. • HUC shall maintain operational control of each meter set unless otherwise agreed. • All access shall be coordinated to ensure safety and system reliability. 8. RECORDS AND REPORTING • HUC shall maintain measurement and operational records for a minimum of 5..... ......_ years. • 3M shall have access to relevant data upon reasonable request. • Any discrepancies shall be reviewed and resolved collaboratively. 9. DISPUTE RESOLUTION • Disputes shall first be addressed through good faith negotiations between the Parties and if the dispute is not resolved through negotiations Then each party may proceed to file an action in Mcleod County, Minnesota District Court. 10. INTERRUPTION AND CURTAILMENT OF SERVICES • Right to ,Interrupt or Curtail Hutchinson Utilities Commission ("HUC") reserves the right to interrupt, curtail, or discontinue the delivery of natural gas, in whole or in part, at or upstream of the Custody Transfer Point (defined as the downstream flange of the custody transfer meter), only under the following conditions: (a) emergency conditions, including but not limited to system failures, equipment malfunctions, or threats to public safety; (b) force majeure events; (c) compliance with applicable laws, regulations, or governmental or regulatory orders; or (d) upstream supply curtailments that are beyond the reasonable control of HUC. Curtailment for routine maintenance or economic reasons shall not apply to Firm Delivery Customers like 3M except where no reasonable alternative exists. • Applicability at Custody Transfer Point Curtailment or interruption by HUC shall occur at or upstream of the Custody Transfer Point. All Natural gas, equipment, and facilities downstream of the Custody Transfer Point remain the sole responsibility of 3M. 3M acknowledges that any interruption of supply at the Custody Transfer Point will directly impact downstream operations and assumes all associated risks beyond said point. • Service Classification and Priority Service provided to 3M under this Agreement is classified as Firm Delivery Service. HUC shall make all reasonable efforts to maintain uninterrupted service to 3M and shall not curtail deliveries except under the conditions outlined in Section 1. In the event of system curtailment, HUC shall prioritize deliveries in accordance with applicable regulatory requirements and generally accepted utility practices. To the extent practicable, firm service customers, including 3M, shall receive priority over interruptible customers. • Notice oflnterruption or Curtailment HUC shall provide as much advance notice as reasonably practicable prior to any planned interruption. For emergency or unplanned events, notice shall be provided as soon as practicable. Notification may be made via phone, email, or designated operational communication systems agreed upon by both parties. • 3M Operational Coordination In the event curtailment is necessary under Section 1, 3M shall cooperate with HUC to safely reduce or cease gas usage as directed. HUC shall coordinate with 3M to minimize operational disruption to the extent reasonably practicable. • Restoration of Service HUC shall restore service to 3M as soon as reasonably practicable following resolution of the condition causing the interruption. Restoration priority shall be consistent with 3M's classification as a Firm Delivery Customer, subject to system integrity and safety considerations. • Upstream Curtailment Pass -Through Any curtailment, restriction, or interruption imposed on HUC by its upstream supplier(s) may be passed through to 3M; however, HUC shall use commercially reasonable efforts to mitigate such impacts on Firm Delivery Customers. Limitation of Liability HUC shall not be liable for any damages, losses, or expenses (including but not limited to lost production, loss of profits, or business interruption) resulting from interruption or curtailment of service implemented in accordance with this Agreement, except in cases of HUC's gross negligence or willful misconduct. 11. TERM AND TERMINATION • This Agreement shall remain in effect until terminated by either Parry with * * * * 90* * * * days written notice. • Provisions related to liability and indemnification shall survive termination. 12. GOVERNING LAW This Agreement shall be governed by the laws of the State of Minnesota. 13. ENTIRE AGREEMENT This Agreement represents the entire understanding between HUC and 3M regarding custody transfer of natural gas and supersedes any prior agreements. SIGNATURES Hutchinson Utilities Commission (RUC) Name: ............... Title: Signature: Date: Name: Title: _ Signature: Date: 3M Company Name:de Title: Signature: Date: 5 fl aw 204-6 HUTCHINSON UTILITIES COMMISSION ^I'�xP61Tti'°" Board Action Form Agenda Item: Approve Natural Gas Maintenance Agreement with City of Fairfax Presenter: Byron Bettenhausen Agenda Item Type: Time Requested (Minutes): 5 New Business Attachments: Yes BACKGROUND/EXPLANATION OFAGENDA ITEM: The Maintenance Agreement with the City of Fairfax has been updated to reflect the new contract terms as well as provide revisions to the routine work performed by HUC (Exhibit C). BOARD ACTION REQUESTED: Approve Fairfax Maintenance Agreement Fiscal Impact: 0 Included in current budget: No El Budget Change: No PROJECT SECTION: Total Project Cost: 0 Remaining Cost: HUTCHINSON UTILITIES COMMISSION MAINTENANCE AGREEMENT NATURAL GAS FACILITIES City of Fairfax 5/15/2026 This document sets forth the terms and conditions of service for operation and maintenance of the City of Fairfax's natural gas transmission/distribution metering, regulating, odorizing, water bath heater and line control facilities provided to the City of Fairfax by Hutchinson Utilities Commission. NATURAL GAS FACILITIES MAINTENANCE AGREEMENT THIS NATURAL GAS FACILITIES MAINTENANCE AGREEMENT ("Agreement") is made and entered into on this 1st day of June 2026, by and between the City of Fairfax ("Owner") with offices located at 18 pt Ave SE, Fairfax, Minnesota, 55332 and Hutchinson Utilities Commission ("Operator") a Minnesota municipal utility located at 225 Michigan St. SE, Hutchinson, Minnesota, 55350. Owner and Operator shall hereinafter sometimes be referred to separately as 'Party" or jointly as 'Parties." WITNESSETH: WHEREAS, Owner has constructed or is constructing the Natural Gas Facilities (as hereinafter defined); WHEREAS, Owner desires to retain Operator to Maintain the Natural Gas Facilities on behalf of Owner, and Operator is willing to provide said services on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the premises, mutual covenants, conditions and agreements herein contained the parties hereto, intending to be legally bound, hereby agree as follows: ARTICLE L DEFINED TERMS Section 1.1 Definitions. The defined terms used in this Agreement shall, unless the context otherwise requires, have the meanings specified in this Article I. "Agreement" means this Natural Gas Facilities Maintenance Agreement, as the same may from time to time be amended with written consent of Owner and Operator. "Business Day" means any day except Saturday, Sunday or Federal Reserve Bank Holidays. "Commencement Date" shall mean "Nine a.m. Central Clock Time" on June 1, 2026. "Emergency" means any suspected or actual abnormal condition that has already caused, 1 or represents an imminent threat to cause, Facility failure or damage, danger to or loss of life, pollution, or any hazardous condition "Facility" or "Facilities" means the natural gas metering and regulation equipment belonging to Owner, including all apparatuses, located at the Fairfax Interconnect station on the Hutchinson Pipeline, the District Regulator Stations serving the Cities of Fairfax and Gibbon as well as two block valve sites located on the Owner's high-pressure transmission/distribution line. "Gas" shall mean natural gas, manufactured, artificial or synthetic gas, or any mixture or combination thereof. "Gas Day" shall mean a period beginning and ending at 9:00 a.m., Central Clock Time. The reference date for any day shall be the date of the beginning of such day "Governmental Authority" means (1) the United States of America, (ii) any state, county, parish, municipality or other governmental subdivision within the United States of America, and (iii) any court or tribunal or any governmental department, commission, board, bureau, agency or other instrumentality of the United States of America or of any state, county, parish, municipality or other governmental subdivision within the United States of America. "Law" means any applicable statute, law, ordinance, regulation, rule, ruling, order, decree, writ, injunction, judgment or other official act of or by any Governmental Authority. "Maintenance Fee" means the fee for Operator performing Maintenance of the Facilities and Routine Work. "Maintenance" means all work or services required to be furnished or performed by Operator pursuant to this Agreement. "Operator" means Hutchinson Utilities Commission and its permitted successors and assigns hereunder. "Owner" means City of Fairfax and its permitted successors and assigns hereunder. 2 "Permits" means all licenses, permits, certificates, orders, approvals and authorizations of any Governmental Authority necessary for or obtained in connection with operation of the Facilities or performance of the Operations. "Person" means any individual, firm, corporation, partnership, joint venture, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof. "Routine Work" includes day-to-day maintenance, testing and repair and more particularly defined in Exhibit C of this Agreement. "Non -Routine Work" includes work not included in the Routine Work, but shall be provided on an as -needed basis. Said services and fees are set forth in Exhibit D. "Year" or 'year" means aperiod of 12 consecutive months commencing on June 1st and ending on the following June l" Section 1.2 References, Gender, Number. Unless the context requires otherwise, all references in this Agreement to an "Article," "Section" or "Subsection" shall be to an Article, Section or Subsection of this Agreement, and the words "this Agreement," "hereof," "hereunder," "herein," "hereby," or words of similar import shall refer to this Agreement as a whole and not to a particular Article, Section, subsection, clause or other subdivision hereof. Whenever the context requires, the words used herein shall include the masculine, feminine and neuter gender, and the singular and the plural. ARTICLE II: RESPONSIBILITIES OF OPERATOR Section 2.1 General Res7nonsibilities. (a) General. Operator is here by appointed to perform the Maintenance according to prudent practices generally followed by the gas pipeline industry under similar circumstances. To the extent necessary to carry out its duties hereunder, Operator certifies that it is qualified under the 3 Operator Qualification Program as required by the federal Department of Transportation and the Minnesota Office of Pipeline Safety. Operator also certifies that it complies with the Federal requirements outlined in 49 CFR Parts 40 and 199 pertaining to alcohol and controlled substance testing. Operator shall provide Owner with the services required for the testing, maintenance and repair of the Facilities as more fully described below and in Exhibit C and D. Owner and Operator shall have unrestricted access to the Facilities. It is expressly understood and agreed that in the performance of its obligations under this Agreement, Operator is and shall at all times be an independent contractor. Operator, as an independent contractor, shall be solely responsible for its employees and equipment. Owner acknowledges that Maintenance is dependent upon Owner providing Operator access to the Facilities. (b) Routine Work. On and after the Commencement Date, Operator shall perform or cause to be performed all Routine Work for the Facilities, including but not limited to, repair, improvement, maintenance, alteration, inspection, testing, protection and other operations and activities with respect to the Facilities as are reasonably necessary to maintain the Facilities in a "first- class operating condition" in accordance with the federal safety and maintenance standards promulgated under 49 CFR Part 192 and the regulations of the Minnesota Office of Pipeline Safety. The Routine Work is described in greater detail in Exhibit C. (c) Emergency Work. Operator will perform all Emergency maintenance and repair of the Facilities consistent with prudent practices generally followed by the gas pipeline industry under similar circumstances. Operator will notify Owner of any Emergency condition affecting the Facilities promptly after Operator learns of such condition and will consult with Owner, as far as practical, concerning the actions that are necessary. If Owner fails to respond or if Operator is otherwise unable to consult with Owner, the Operator shall take those actions that Operator believes are necessary consistent with prudent utility practices and will contact Owner as soon as possible after the fact. C! Owner will notify Operator after Owner learns of any Emergency condition affecting the Facilities promptly after Owner learns of such conditions and will consult with Operator, as far as practical, concerning the actions that are necessary. Operator shall take those actions that the Operator believes are necessary consistent with prudent utility practices and will respond promptly to remedy emergency situation. (d) Scheduling. To the extent reasonably possible, the performance of repair or maintenance that affects the operations of the Facilities shall be scheduled to be performed only at times acceptable to Owner. Except for Emergency or unplanned work, in the event it is necessary to either interrupt or curtail the gas supply or to otherwise impose abnormal operating conditions on the Facilities, Owner shall be notified in advance and an agreement must be reached as to the time scheduled for such work. (e) Work by Others. If any part of the Maintenance is dependent upon the quality and completeness of work performed under another contract unrelated to Operator, Operator shall not be responsible if the work performed under the other contract is defective or unsuitable and such condition affects the timing, scheduling or quality of the Operations performed by Operator hereunder. Section 2.2 Personnel. Operator may employ or, contract for, the services of and be responsible for the supervision of Persons (including consultants and professional, service or other organizations) reasonably required by Operator to perform the Maintenance in an efficient and prudent manner. The number of Persons used by Operator in conducting the Maintenance, their hours of work and their compensation for services performed shall be determined by Operator. All employees and other personnel provided by Operator pursuant to this Agreement shall be the employees or independent contractors of Operator and in no event shall such employees or other personnel be deemed employees or contractors of Owner. On or before the Commencement Date, Operator shall 5 designate to Owner in writing a representative who shall be authorized to act on behalf of Operator as to the Maintenance and with whom Owner may consult at all reasonable times. Operator may change its representative by written notice to Owner Section 2.3 Operator Warranties. Operator warrants and represents to Owner as follows: Operator shall perform the Maintenance, and shall require all contractors, subcontractors and materialmen furnishing labor, material or services for the Maintenance to perform their services and carry out their responsibilities, in a diligent, safe and efficient manner in accordance with good workmanlike and prudent practices generally followed by the gas pipeline industry under similar circumstances, but such practices shall not be less than as may be specifically required by this Agreement. In carrying out such responsibilities, Operator shall comply, and shall use its reasonable efforts to require all contractors, subcontractors and material to comply, with all Laws of Governmental Authorities having jurisdiction. All policies and procedures to be developed by Operator hereunder shall be available to Owner for its review at Operator's office during normal business hours. THESE WARRANTIES- ARE EXCLUSIVE AND GIVEN IN LIEU OF ALL OTHER WARRANTIES WHETHER STATUTORY, EXPRESS, OR IMPLIED (INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OF THIRD PARTY INTELLECTUAL PROPERTY RIGHTS, OR ANY WARRANTY ARISING FROM A COURSE OF DEALING, USAGE, OR TRADE PRACTICE). Section 2.4 Owner Warranties. Owner warrants and represents to Operator that the information it supplies to Operator upon which the Operations may be based is true and correct to the best of Owner's knowledge. Section 2.5 Fee for Routine Work. Fees for Routine work are stated in Exhibit "C". Section 2.6 Compensation for Non -Routine Work. Except for any non -routine expenditure that results from Operator's breach of this Agreement, negligence, or willful misconduct, Owner shall bear the cost of any direct out-of-pocket expenditure reasonably incurred by Operator for Non -Routine Work performed in connection with the Facilities, including labor and materials, plus Operator's overhead as stated in Exhibit "D". Any Non -Routine Work that is in excess of $500.00 per event and that is not the result of an Emergency, will be reviewed and approved by the Owner in advance, subject to Section 2.1(c). "Non -Routine Work" is defined in more detail in Exhibit D attached hereto. Section 2.7 PaylLient. On or before the twentieth (20th) day of each calendar month, Operator shall render an invoice to Owner indicating all fees payable under this Agreement for the preceding calendar month. Payment is due from Owner on or before the thirty fifth day following the date the bill is issued by Operator. A late payment charge of one and one-half percent per month, or the legally authorized maximum interest rate, whichever is lower, shall be levied on any unpaid balances. Section 2.8 Owner Duties. Owner shall fully cooperate with Operator in performing Maintenance. Owner hereby grants Operator the non-exclusive right to access and use the Facilities, for purposes of and subject to the terms of this Agreement. ARTICLE III: TRANSFERS OF RESPONSIBILITIES OF OPERATOR Section 3.1 Transfer of Responsibilities. (a) Upon the expiration of this Agreement or the removal of Operator under Section 7.2, the Operator shall assign, transfer and deliver to the Person selected by Owner to succeed Operator (or to such other Persons as Owner shall direct) (1) possession and control of the Facilities and all Operations and (2) to the extent requested by Owner, all contracts, warranties, operating and maintenance manuals, designs, drawings, operational plans, 7 proprietary information and operational rights obtained or entered into by Operator exclusively with respect to the Facilities or exclusively in _connection with the Maintenance, in each case without giving rise to any penalty, charge, restriction, lien, security interest, encumbrance, cancellation, termination, acceleration or change in terms not previously approved by Owner. Operator shall fully cooperate with Owner in transfer of Maintenance hereunder to Owner or a successor operator designated by Owner. Upon termination, Operator shall return to Owner all original records and any materials purchased by Operator and paid for by Owner, such as pretested pipe, valves and other miscellaneous materials and supplies. (b) As soon as practicable after the date on which the Operator is required to transfer its responsibilities as provided in Article Ill (a), Owner may conduct an audit and inventory of the Facilities and all of Owner's assets and properties operated, managed or controlled by Operator. Such audits and inventory shall be used in the return of and the accounting for the Facilities and Owner's properties and assets by Operator for the purposes of the transfer of responsibilities under Article III. All costs and expenses incurred in connection with such audits and inventory shall be borne by Owner. ARTICLE IV: INSURANCE Section 4.1 Owner's Insurance. Owner shall procure and maintain in full force and effect, at the Owner's cost, all risk property insurance in an amount equal to the full insurable value of the Facilities. Section 4.2 Operator's Insurance. Operator shall procure and maintain in full force and effect at the Operator's cost, the following insurance coverage: (a) Worker's Compensation and Employer's Liability insurance in accordance with the laws of Minnesota with limits for Employer's Liability of $1,500,000 per accident or disease, aggregate as disease. 8 (b) Business automobile liability insurance covering owned, non -owned and hired vehicles with minimum combined single limits for bodily injury and property damage for any single loss of $2,000,000. (c) Commercial general liability insurance with completed operations coverage for claims alleging bodily injury including death and damage to property of others, with a combined single limit of $2,000,000 for bodily injury and property damage per occurrence and $3,000,000 in the aggregate. (d) Excess liability insurance for claims alleging bodily injury including death and damage to property with a combined single limit of $5,000,000 for bodily injury and property damage per occurrence and in the aggregate. Section 4.3 Other Insurance Requirements. Each Party shall be listed as an additional insured with respect to the insurance coverage required under this Article IV. All insurance policies shall be endorsed to provide that all insureds and additional insureds hereunder be given thirty (30) days' advance notice of cancellation or material change. Within thirty (30) days of the date of this Agreement, each Party shall furnish to the other Party certificates as evidence showing that the insurance policies to be carried in accordance with this provision have been obtained. Section 4.4 Maximum Liability. Operator's maximum liability is limited to a combined single limit of $1,500,000 by Minnesota Statute. ARTICLE V: FORCE MAJEURE Section 5.1 Performance Excused. If any Party is rendered unable, wholly or in part, by force majeure to carry out its obligations under this Agreement, other than the obligation to make money payments or to furnish security, that party shall give to all other parties prompt written notice of the force majeure with reasonably full particulars concerning it; and thereupon, the obligations of the party giving notice, so far as they are affected by the force majeure, shall be suspended during, but no longer than, the 01 continuance of the force majeure. The party claiming force majeure shall notify the other parties of the force majeure situation within a reasonable time after the occurrence of the facts relied on and shall keep all parties informed of all significant developments. Such notice shall give reasonably full particulars of said force majeure, and also estimate the period of time, which said party will probably require to remedy the force majeure. Force Majeure does not relieve the operator of the contractual responsibilities to operate the Facilities; provided that, the Facilities can be operated utilizing reasonable and safe methods. The affected party shall use all reasonable diligence to remove the force majeure situation as quickly as practicable in an economic manner. The requirement that any force majeure shall be remedied with all reasonable dispatch, shall not require the settlement of strikes, lockouts or other labor difficulty by the party involved, contrary to its wishes; how all such difficulties shall be handled shall be entirely within the discretion of the party concerned. Section 5.2 Force Majeure Defined. The term "force majeure", as here employed, shall mean an act of God, strike, lockout or other industrial disturbance, act of the public enemy, war, blockade, public riot, lightning, fire, storm, flood, earthquake, explosion, pandemic, governmental action, governmental delay, restraint or inaction, unavailability of equipment/supply chain issues and any other cause, whether of the kind specifically enumerated above or otherwise, which is not reasonably within the control of the party claiming suspension. ARTICLE VI: ASSIGNMENT Section 6.1 Assignment by Owner. Owner may not assign all or any part of its rights or obligations under this Agreement without prior written consent of Operator. Section 6.2 Assignment by Operator may not assign all or any part of its rights or obligations under this Agreement without the prior written consent of Owner. Such approvals shall not be unreasonably delayed, withheld or conditioned. 10 ARTICLE VII: TERM Section 7.1 Term. This Agreement shall become effective on the Commencement Date and shall continue in force and effect until "Nine a.m. Central Clock Time" on June 1, 2027, and year-to-year thereafter, subject to termination. (a) Owner shall notify Operator in writing ninety (90) days prior to the expiration date of this Agreement as to Owner's desire for Operator to continue maintenance of the Facility. Operator shall respond in writing to Owner within thirty (30) days of receipt of Owner's notice and on or before sixty (60) days prior to the expiration of this Agreement regarding the Operator's desire to continue as Operator. Section 7.2 Default and Termination. Upon failure by either Party in the performance of any provision, condition or requirement herein, the other Party may give notice in writing to the defaulting party specifying the default. Unless such default is cured within thirty (30) days following receipt of such notice to the defaulting Party, or if such default is susceptible of being cured and such cure cannot be completed with such thirty (30) days period, then if the cure thereof is not undertaken promptly upon receipt of such notice and diligently prosecuted thereafter, this Agreement may be terminated within sixty (60) days of the date of the notice claiming default was written at the option of the Party serving such notice of default. Section 7.3 Effect of Termination. Termination of this Agreement shall not relieve either Party from any obligation including payments due for Operations as provided in this Agreement, accruing to the date of such termination or relieve any Party of any liability for its breach of this Agreement. Article III shall survive any termination of this Agreement. 1 ARTICLE VIIL• MISCELLANEOUS Section 8.1 Governima Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota without reference to the choice or conflict of law, rules or principals thereof which would refer the matter to the laws of another jurisdiction. Each Parry shall abide by the Laws of any Governmental Authorities with jurisdiction over the matters of this Agreement, as maybe amended from time to time. Section 8.2 Entire Agreement. This Agreement and the Schedules and Exhibits hereto contain the entire agreement between the Parties with respect to the subject matter hereof and there are no agreements, understanding, representations or warranties between the parties other than those set forth or referred to herein. Section 8.3 Notices. Except as otherwise specifically provided, all notices authorized or required between the Parties by any of the provisions of this Agreement, shall be in writing, in English and delivered in person or by registered mail or by courier service or by any electronic means of transmitting written communications that provides confirmation of complete transmission, and addressed to such Parties as designated below. The originating notice given under any provision of this Agreement shall be deemed delivered only when received by the Party to whom such notice is directed, and the time for such Party to deliver any notice in response to such originating notice shall run from the date the originating notice is received. The second or any response notice shall be deemed delivered when received. 'Received", for purposes of this Section with respect to written notice delivered pursuant to this Agreement, shall be actual delivery of the notice to the address of the Party to be notified, specified in accordance with this Section. Each Party shall have the right to change its address at any time and/or designate that copies of all such notices be directed to another Person at another address, by giving written notice thereof to all other Parties. 12 City of Fairfax 18 pt St. SE Fairfax, MN 5539655332 Attention: Andrea Merkel City Administrator E-Mail: Admin(cr�fairfax-mn.gov Telephone No.: 507-426-7255 Hutchinson Utilities Commission 225 Michigan St. SE Hutchinson, Minnesota 55350 Attention: Byron Bettenhausen E-Mail: bbettenhausenL&hutchinsommn.goy Telephone No.: 320-234-0507 Fax No.: 320-587-4721 Section 8.4 Successors and As Subject to- the restrictions and requirements on assignment and transfer contained in this Agreement, this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and assigns. Section 8.5 Headin The headings to Articles, Sections and other subdivisions of this Agreement are inserted for convenience of reference only and will not affect the meaning or interpretation of this Agreement. Section 8.6 Amendments and Waivers. This Agreement may not be modified or amended except by an instrument or instruments in writing, signed by all Parties. Any Party may, only by an instrument in writing, waive compliance by another Party hereto with any term or provision of this Agreement on the part of such other Party hereto to be performed or complied with. The waiver by any Party of a breach of any term or provision of this Agreement shall not be construed as a waiver of any subsequent breach. 13 Section 8.7 Schedules and Exhibit. All Schedules and Exhibits to this Agreement are hereby incorporated by reference. Section 8.8 Agreement for the Parties' Benefit Only This Agreement is not intended to confer upon any Person not a party hereto or a permitted successor or assign of a Party any rights or remedies hereunder, and no Person, other than the Parties or a permitted successor or assign thereof, is entitled to rely on any covenant or agreement contained herein. Section 8.9 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible. Section 8,.10 Independent Contractor, No Partnership Operator shall perform its duties and obligations hereunder as an independent contractor, and nothing contained herein shall be deemed to create a relationship of employer/employee, master/servant, agency, partnership or joint venture. This Agreement is not intended to create, and shall not be construed to create, a relationship of partnership or an association for profit between Operator and Owner. Section 8.11 Data Practices Act. The Parties acknowledge that Operator is subject to Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13 (the "Act"), including limiting public access to trade secret and 14 other protected data. Each Parry agrees to defend, indemnify, and hold harmless the other Party, its officials, officers, agents, employees, contractors, and subcontractors from any claims resulting from unlawful disclosure and/or use of such protected data. Owner agrees to promptly notify Operator if Owner receives a request to access the terms of this Agreement, and to cooperate with Operator if Operator seeks a protective order, at Operator's expense. Owner agrees to promptly notify Operator if Owner becomes aware of any potential claim, or facts giving rise to potential claims, under the Act. The terms of this section shall survive the termination of this Agreement. Section 8.12 News Releases. News releases concerning the Maintenance or the Facilities shall only be made in accordance with the following guidelines, subject to the requirements of applicable laws and governmental rules and regulations: No public announcement or statement shall be issued by Operator unless prior to its release Owner has been furnished with a copy of such statement or announcement and the reasonable approval of the Owner has been obtained. Where a public announcement or statement becomes necessary or desirable because of an Emergency as a result of activities arising under this Agreement, Operator is authorized to issue and make such announcements or statements without prior reasonable approval of the Owner but shall promptly furnish Owner with a copy of the announcement or statement. Section 8.13 Authority„to Enter Agreement. Each parry to this Agreement represents and warrants that it has full and complete authority to enter into and perform this Agreement. Each person who executes this Agreement on behalf of either party represents and warrants that it has full and complete authority to do so and that such parry will be bound thereby. Section 8.14 Alternative Dispute Resolution. Whenever the Parties disagree on the interpretation or enforcement of this Agreement, or upon calculations or payments, then upon written request of either Party, representatives with settlement authority for each Party shall meet in person and confer in good faith to resolve the dispute. If the 1 Parties are unable to resolve the dispute; they shall submit their dispute to mediation pursuant to the Minnesota Civil Mediation Act. If the dispute is not resolved by mediation, the Parties may invoke their legal remedies available by law. Section 8.15 CounterpArtss. This Agreement may be executed in counterparts, and each executed counterpart shall have the same force and effect as an original instrument. ARTICLE IX: LIABILITY; INDEMNITY Section 9.1 Indemnification byOwner Owner shall defend, protect, indemnify, and hold harmless Operator, and its members, directors, officers, employees and agents from and against all liability, claims, liens, costs, expenses, demands, fines or other actions imposed by any Governmental Agency with jurisdiction, suits and causes of action of every kind and character arising in favor of any third party on account of personal injuries or death, or damages to property (including without limitation claims for pollution and environmental damage) in any way directly resulting from the negligent acts or omissions of the Owner, its agents, employees, representatives, or contractors, or from the failure of Owner, its agents, employees, representatives, or contractors to perform its obligations under this Agreement and in compliance with all applicable Laws. This indemnity includes Owner's agreement to pay all costs of defense, including without limitation attorneys' fees, incurred by any person or party indemnified herein. Owner acknowledges that utility equipment malfunction or failure may occur notwithstanding the inspection, maintenance, and repair work performed hereunder, and hereby indemnifies, releases, and holds Operator harmless from any claim or liability, and any direct or indirect damages claimed or actually suffered (including, without limitation, consequential damages and loss of profits), resulting from any utility equipment malfunction or failure occurring during the term of this Agreement, except such claims or liability directly resulting from the negligent acts or omissions of Operator. IGol Section 9.2 Indemnification by Operator Subject to Section 2.1 (c), Operator shall defend, protect, indemnify, and hold harmless Owner, and its members, directors, officers, employees and agents from and against all liability, claims, liens, costs, expenses, demands, fines or other actions imposed by any Governmental Agency with jurisdiction, suits and causes of action of every kind and character arising in favor of any third parry on account of personal injuries or death, or damages to property (including without limitation claims for pollution and environmental damage) in any way directly resulting from the negligent acts or omissions of Operator, its agents, employees, representatives, or contractors, or from the failure of Operator, its agents, employees, representatives, or contractors to perform its obligations under this Agreement and in compliance with all applicable Laws. This indemnity includes Operator's agreement to pay all costs of defense, including without limitation attorneys' fees, incurred by any person or party indemnified herein. Operator agrees that the obligations of indemnification herein include, but are not limited to, liens by third parties against Owner and its property because of labor, services, materials, or any other subject of lien, furnished to Operator or its assignees or subcontractors, in connection with any work performed by Operator hereunder. Section 9.3 No Consequential Damages Under no circumstances shall either Party hereto be liable to the other hereunder for indirect, special, consequential or similar damages, or for loss of profits. 17 WHEREFORE, the Parties have executed this Agreement in two (2) duplicate originals by their duly authorized, respective officers, effective as of the date specified above. CITY OF FAIRFAX HUTCHINSON UTILITIES COMMISSION By: By: Name: Name: Title: Title: Date: Date: Witness: Witness: Date: Date: HUTCHINSON UTILITIES COMMISSION By: Name: Title: Date: Witness: Date: 18 This Exhibit "A" is attached to and made part of that certain Maintenance Agreement - Natural Gas Facilities (the "Agreement") by and between City of Fairfax ("Owner") and Hutchinson Utilities Commission ("Operator"). OPERATOR'S PAYMENT INSTRUCTIONS: For the purpose of this Agreement, Owner shall make all payments provided in the Agreement to Operator via Check to the following: Hutchinson Utilities Commission 225 Michigan St SE Hutchinson, Minnesota 55350 EXHIBIT "B" This Exhibit "B" is attached to and made part of that certain Maintenance Agreement - Natural Gas Facilities (the "Agreement") by and between City of Fairfax ("Owner") and Hutchinson Utilities Commission ("Operator"). Owner has constructed (or will construct) and own the natural gas facilities, including all apparatuses, located at the Fairfax Interconnect station on the Hutchinson Pipeline, the District Regulator Stations serving the Cities of Fairfax and Gibbon as well as the two Block Valve Sites located on the Owner's high-pressure transmission/distribution line, appurtenances thereto, ("Facility" or "Facilities") serving City of Fairfax, Fairfax, Minnesota. Each interconnected third -party natural gas operator shall operate their respective pipeline facilities connected to the Facilities. EXHIBIT "C" This Exhibit "C" is attached to and made part of that certain Maintenance Agreement - Natural Gas Facilities (the "Agreement") by and between City of Fairfax ("Owner") and Hutchinson Utilities Commission ("Operator"). ROUTINE WORK All labor shall be charged at a cost plus 50% of the Operator hourly rate in affect at the time of the work being performed multiplied by the number of hours required by the employee(s) to complete Maintenance work for Owner. Hours required to complete Maintenance includes travel time from Operators' work center to job site including return trip to Operator's work center. Operator non -overtime rate - $63/hour Operator vehicle hourly rate - $47/hour All materials shall be charged at a cost plus 15% to cover all inventory and purchasing fees. LIST OF ROUTINE ITEMS: 1. Inspect Fairfax Reg Station a. Operate valves b. Atmospheric corrosion check / CP c. Switch regulator nuns every year to operate on other nun/check locktip d. Check operation of relief valve e. Rebuild Regulators per manufacture recommendations (every 6 yrs) f. Rebuild Relief valve per manufacture recommendations (every 6 yrs) 2. Inspect Gibbon Reg Station a. Operate valves b. Atmospheric corrosion check / CP c. Switch regulator nuns every year to operate on other nun/check locktip d. Check operation of relief valve e. Rebuild Regulators per manufacture recommendations (every 6 yrs) f. Rebuild Relief valve per manufacture recommendations (every 6 yrs) 3. Inspect and operate all valves at Interconnect Gas shed 4. Inspect Top Run a. Switch to other nun for the year and check for locktip operation b. Rebuild regulator every 6 years unless we have mechanical failure of regulator 5. Inspect Bottom Run a. Switch to other nun for the year and check for locktip operation b. Rebuild regulator every 6 years unless we have mechanical failure of regulator 6. Rebuild Odorizer a. Yearly rebuild (manufacture recommendation) b. Replace battery every 2 yrs (manufacture recommendation) 7. Help work on line -heater only as requested by City of Fairfax 8. Help with odor transfer only as requested by City of Fairfax EXHIBIT "C", continued A. Legal and Regulatory Compliance 1. Maintain DOT System records 2. Maintain Training & DOT Operator Qualification Program and records 3. Maintain Anti -Drug and Alcohol compliance programs 4. Maintain operating procedures, maintenance procedures, and training plans and procedures to be followed for Maintenance, and ensure procedures and plans are available for review by Owner in Operator's office during normal business hours 5. Maintain Emergency Response Plan, Operation & Maintenance Manual, and Operator Qualification Plan, including annual updates 6. Reporting to Owner any notices of violations of any Laws or Permit provisions 7. Maintain the Facilities' and Operations' ongoing compliance with all Laws and Permits B. Monitoring and Testing 1. Witness third party meter calibrations at the request of Owner. 2. Perform monthly odorization monitoring 3. Maintain proper documentation on all inspections, tests and calibrations completed by HUC C. Other 1. Maintain in force and effect and require all contractors (and their subcontractors) performing services for the benefit of Owner to maintain in force and effect, insurance of the types and in the amounts specified by Owner. 2. Undertake all reasonable efforts to keep the Facilities, all contracts relating to the Maintenance, and all property and rights of Owner free and clear of any and all liens, encumbrances, security interests, charges, claims and restrictions arising out of or on account of the Operations 3. Maintain 24-hour emergency telephone number 4. Procure and furnish all equipment, services, supplies, labor and supervision necessary to carry out Operator's responsibilities under this Agreement. EXHIBIT "D" This Exhibit "D" is attached to and made part of that certain Maintenance Agreement - Natural Gas Facilities (the "Agreement") by and between City of Fairfax ("Owner") and Hutchinson Utilities Commission ("Operator"). NON -ROUTINE WORK EXAMPLE OF NON -ROUTINE ITEMS: After-hours, holidays, weekends emergency response 2. Additional personnel as may be required during emergencies 3. Additional contractors as may be required during emergencies Any and all other items relevant to the metering and regulation facility operation and maintenance that are neither listed above nor included in the attached Exhibit C. Expense" Cost + 80% Cost + 80% Cost + 50% Cost + 50% ** "Expense", as referenced above, shall be the cost of materials, equipment and third - party labor to complete the applicable work or project. Operator shall invoice such cost plus listed overhead. In addition, thereto, Operator shall charge $63.00 per man-hour for non - overtime work. All vehicles and equipment shall be charged by the amount reflected in the following table. All labor shall be billed at the appropriate hourly rate; straight time, time and one-half or double time dependent on time of day and day of week work was required. EXHIBIT "D", continued Labor and E ui ment Rates Der Hour AIR COMPRESSOR $42.00 WELDER $52.00 BACKHOE $80.00 VEHICLE $47.00 OPERATOR $63.00 HUTCHINSON UTILITIES COMMISSION ^I'�xP61Tti'°" Board Action Form Agenda Item: Approve Amendment #2 to the Heartland Corn Reservation Agreement Presenter: Jeremy Agenda Item Type: Time Requested (Minutes): 5 New Business Attachments: Yes BACKGROUND/EXPLANATION OFAGENDA ITEM: HCP entered into a Firm Capacity Reservation agreement on December 20, 2023 to earmark an additional 4,700 Dth's/day of capacity to account for future growth and natural gas needs in their operations. The first amendment converted 400 Dth's/day from the reservation agreement to the firm transportation agreement leaving the reservation agreement amount at 4,300 Dth's/day. At this time, HCP is requesting to convert an additional 1000 Dth's/day from the reservation agreement to the firm transportation agreement. This will bring the reservation agreement down from 4,300 Dth/day to 3,300 Dth/day. BOARD ACTION REQUESTED: Approve Amendment #2 Fiscal Impact: - $21,350 Included in current budget: No Budget Change: No PROJECT SECTION: Total Project Cost: Remaining Cost: �rtCHINS utchinson Utilities vrraln�� Commission 2ND AMENDMENT TO HEARTLAND CORN PRODUCTS NATURAL GAS FIRM CAPACITY RESERVATION AGREEMENT THIS AMENDMENT (THE "AMENDMENT") IS MADE AND ENTERED INTO THIS TH DAY OF MAY, 2026 BY HEARTLAND CORN PRODUCTS ("HCP"), LOCATED AT MN-1 9, WINTHROP, MINNESOTA, 55396 AND HUTCHINSON UTILITIES COMMISSION ("HUC") A MINNESOTA MUNICIPAL UTILITY LOCATED AT 225 MICHIGAN ST SE, HUTCHINSON, MINNESOTA, 55350, PARTIES TO THE AGREEMENT DATED DECEMBER 20TH, 2023. 2. THE AGREEMENT IS AMENDED AS FOLLOWS: • EFFECTIVE .JUNE 1 ST, 2026 HEARTLAND CORN PRODUCTS ELECTS TO REDUCE THE FIRM NATURAL GAS CAPACITY RESERVATION AMOUNT FROM 4,300 DTH PER DAY TO 3,300 DTH PER DAY FOR 365 DAYS PER YEAR. EXCEPT AS SET FORTH IN THIS AMENDMENT, THE AGREEMENT 1S UNAFFECTED AND SHALL CONTINUE IN FULL FORCE AND EFFECT IN ACCORDANCE WITH ITS TERMS AND CONDITIONS. IN THE EVENT THERE IS A CONFLICT BETWEEN THIS AMENDMENT AND THE AGREEMENT, THE TERMS OF THIS AMENDMENT SHALL PREVAIL. THIS AMENDMENT SETS FORTH ALL TERMS AGREED UPON BETWEEN THE PARTIES, AND NO PRIOR ORAL AMENDMENTS SHALL., BE BINDING. THIS AMENDMENT SHALL NOT' BE ALTERED, AMENDED OR MODIFIED EXCEPT AS IN WRITING AND EXECUTED BY BOTH PARTIES. HUTCHINSON UTILITIES COMMISSION BY: NAME: _ TITLE: DATE: _ WITNESS: TITLE: DATE: HEARTLAND N PRODUCTS d By: - NAME: TITLE: Cam. DATE: HUTCHINSON UTILITIES COMMISSION ^I'�xP61Tti'°" Board Action Form Agenda Item: Approve Amendment #2 to the Heartland Corn Firm Transportation Agreement Presenter: Jeremy Agenda Item Type: Time Requested (Minutes): 5 New Business Attachments: Yes BACKGROUND/EXPLANATION OFAGENDA ITEM: Hutchinson Utilities Commission 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's/day through 11 /30/2043. 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 their operations. This agreement expires on 9/30/2027. The first amendment converted 400 Dth's/day from the reservation agreement to the firm transportation agreement which currently totals 12,700 Dth's/day. At this time, HCP is requesting to convert an additional 1000 Dth's/day from the reservation agreement to the firm transportation agreement. This change will adjust the current firm transportation agreement from 12,700 to 13,700 Dth's/day of firm capacity on the pipeline. BOARD ACTION REQUESTED: Approve Amendment #2 Fiscal Impact: + $42,700 Included in current budget: No Budget Change: No PROJECT SECTION: Total Project Cost: Remaining Cost: �cCHINS Hutchinson Utilities "Commission Utit Itts 2ND AMENDMENT TO HEARTLAND CORN PRODUCTS NATURAL GAS FIRM TRANSPORTATION CAPACITY AGREEMENT THIS AMENDMENT (THE "AMENDMENT") IS MADE AND ENTERED INTO THIS �) TH DAY OF MAY, 2026 BY HEARTLAND CORN PRODUCTS ("HCP"), LOCATED AT MN-1 9, WINTHROP, MINNESOTA, 55396 AND HUTCHINSON UTILITIES COMMISSION ("HUC") A MINNESOTA MUNICIPAL UTILITY LOCATED AT 225 MICHIGAN ST SE, HUTCHINSON, MINNESOTA, 55350, PARTIES TO THE AGREEMENT DATED NOVEMBER 1, 2023. 2. THE AGREEMENT IS AMENDED AS FOLLOWS: EFFECTIVE JUNE 1 ST, 2026 HEARTLAND CORN PRODUCTS ELECTS TO CONVERT 1,000 DTH PER DAY FROM THE NATURAL GAS FIRM CAPACITY RESERVATION AGREEMENT ENTERED INTO ON THE 20TH DAY OF DECEMBER 23, 2023 TO THE NATURAL GAS FIRM TRANSPORTATION AGREEMENT. THIS AMENDMENT CONSTITUTES HUC SHALL PROVIDE TO HCP FIRM NATURAL GAS TRANSPORTATION CAPACITY IN THE AMOUNT OF 13,700 DTH PER DAY FOR 365 DAYS PER YEAR. EXCEPT AS SET FORTH IN THIS AMENDMENT, THE AGREEMENT IS UNAFFECTED AND SHALL CONTINUE IN FULL FORCE AND EFFECT IN ACCORDANCE WITH ITS TERMS AND CONDITIONS. IN THE EVENT THERE IS A CONFLICT BETWEEN THIS AMENDMENT AND THE AGREEMENT, THE TERMS OF THIS AMENDMENT SHALL PREVAIL. THIS AMENDMENT SETS FORTH ALL TERMS AGREED UPON BETWEEN THE PARTIES, AND NO PRIOR ORAL AMENDMENTS SHALL BE BINDING. THIS AMENDMENT SHALL NOT BE ALTERED, AMENDED OR MODIFIED EXCEPT AS IN WRITING AND EXECUTED BY BOTH PARTIES. HUTCHINSON UTILITIES COMMISSION BY: NAME: _ TITLE: DATE: WITNESS: TITLE: DATE: HEARTLAND.c RN PRODUCTS BY: NAM E:4._..i�O(V\ W' TITLE: 0_:r DATE: