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03-28-1983 HUCM., / 6 >> -4t- Regular Meeting March 28, 1983 All Commissioners were present, also present were Mgr. Alexander, Don Swanson of Associated Consultants, Counsel Peterson and Ruth Hakel. President Filk called the meeting to order at 1:00 p.m. A motion was made by Commissioner Daggett, seconded by Commissioner Lyke to accept the February 28, 1983 minutes as presented. Motion was unanimously carried. A motion was made by Commissioner Daggett, seconded by Commissioner Lyke to accept the minutes of the special meetings dated March 3 and March 23, 1983. Motion was unanimously carried. A motion was made by Commissioner Daggett, seconded by Commissioner Lyke to accept the February gas and electric payables. Motion was unanimously carried. Ruth Hakel presented the financial statements. After discussion, Commissioner Lyke made a motion, seconded by Commissioner Daggett Mgr. Alexander and Don Swanson reviewed with the Commission two proposals for firm power. The proposals were received from United Power Association and are attached to the face of these minutes. After a discussion period, it was the feeling of the Commission to take the proposals under advisement; and if interest was shown in the future, proper personnel would be contacted. A sample Agency Agreement (to be named Central Minnesota Power Agency) had been given to the Commissioners prior to the meeting. Mgr. Alexander discussed advantages in belonging to such an agency; namely, the possibility of selling energy to various smaller towns and perhaps utilizing Hutchinson Utilities Commission's dispatching center. It was decided to delay action until a future date. Don Swanson presented an analysis of the 1982 Hutchinson electric operation. President Filk expressed his appreciation for a very fine report. 1 to accept both reports. Motion was unanimously carried. Mgr. Alexander reviewed the 1983 budget for both entities. After discussion, a motion was made by Commissioner Daggett, seconded by Commissioner Lyke to accept the budgets as presented. It was noted that the budget be used as a guideline for staff and that quarterly reports be prepared for the Commission. Mgr. Alexander and Don Swanson reviewed with the Commission two proposals for firm power. The proposals were received from United Power Association and are attached to the face of these minutes. After a discussion period, it was the feeling of the Commission to take the proposals under advisement; and if interest was shown in the future, proper personnel would be contacted. A sample Agency Agreement (to be named Central Minnesota Power Agency) had been given to the Commissioners prior to the meeting. Mgr. Alexander discussed advantages in belonging to such an agency; namely, the possibility of selling energy to various smaller towns and perhaps utilizing Hutchinson Utilities Commission's dispatching center. It was decided to delay action until a future date. Don Swanson presented an analysis of the 1982 Hutchinson electric operation. President Filk expressed his appreciation for a very fine report. 1 Sue Potter of West Central Industries presented a proposal on reader /printer and microfilm capabilities. After a discussion period, it was the feeling of the Commission to take the matter under advisement until a future date. Don Swanson presented revised estimates for the roof repair. Two types of roof - built -up, $55,000 and pitch, $67,000. Commissioner Daggett moved to have Associated Consultants prepare specifications for the flat built -up roof bid ($55,000), seconded by Commissioner Lyke. Motion was unanimously carried. Copies of the Interconnection and Interchange Agreement with Northern States Power Company was presented by Don Swanson and signed by President Filk and Secretary Lyke. The following are February payables: 1 1 A111i,SSOCIATED '111 :ONSULTANTS Inc. REGISTERED PROFESSIONAL ENGINEERS 3131 FERNBROOK LANE NORTH MINNEAPOLIS, MINNESOTA 55441 612/558 -5511 Hutchinson Municipal Utilities 225 Michigan Street Hutchinson, MN 55350 Attn: Mr. Rufus Alexander, Manager Dear Alex: February 24, 1983 RE: UPA Power Proposals United Power Association now has two proposals for firm type power which you may or may not wish to consider. The types of power purchase plans are: Participation Power Presently you are under contract until 1985 for 10 MW of Coal Creek Participation Power, which you have been able to obtain at nearly a 100% load factor. We projected your 1982 average delivered cost for this power to be 33.53 mills per KWH, while actual cost proved to be 33.27 Mills. UPA has proposed to extend this agreement with you until 1992, with guaranteed demand charges. Table I indicates the projected costs in Mills per KWH. Ten Year Ownership in Coal Creek UPA has made another proposal for firm type power where any utility or group participation would purchase ownership in Coal Creek Generating Station (including D.C. transmission) for a ten year period at $1,000 per KW. After ten years UPA would guarantee to buy back and the purchaser would guarantee to sell back the capacity originally purchased for $1,000 per KW. Table II is a projection of Hutchinson's delivered costs for such power. In this table estimated interest on money borrowed would replace the demand charge of Participation Power. Theoretically, the group purchasing such power would borrow the necessary money and pay interest only for ten years. After selling the capacity back to UPA, you could retire the debt with the proceeds from the sale. Cost Comparison of Participation Power and Ten Year Ownership Power From an operational view the Participation Power and Ten Year Ownership power would be identical since both would come from the same electrical generating station over the same transmission lines. Mr. Rufus Alexander, Manager February 24, 1983 Page Two Table II indicates the comparative costs for the ten year period of 1983 to 1992. Projected costs would be $5,235,000 less under the ten year ownership plan, the difference being the municipal's ability to borrow money at a lower interest rate than UPA's fixed cost. These Tables may best be reviewed orally, to determine the various ramification of each option. DES /gal r� Yours very truly, ASSOCIATED CONSULTANTS, inc. Donald E. 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(5) Difference $1.000 (176) ( 70) 41 456 550 649 836 863 981 1,105 5,235 TABLE III HUTCHINSON MUNICIPAL ELECTRIC UTILITY Coal Creek Particiation Power vs Ten Year Ownership 1983 -1992 (1) (2) (3) (4) Participation Power Ten Year Ownership Difference YEAR Mills /KWH Mills /KWH Mills /KWH 1983 34.20 36.43 (2.23) 1984 36.92 37.81 ( .89) 1985 39.82 39.30 .52 1986 45.77 39.98 5.79 1987 47.78 40.80 6.98 1988 49.84 41.61 8.23 1989 52.14 42.08 10.06 1990 54.55 43.60 10.95 1991 57.10 44.66 12.44 1992 59.97 45.95 14.02 (5) Assuming 10,000 KW @ .90 Load Factor or 8,760 Hr x .90 x 10,000 = 78,840,000 KWH /YR. (5) Difference $1.000 (176) ( 70) 41 456 550 649 836 863 981 1,105 5,235 i. Ll .411h,SSOCIATED '1I11 :ONSULTANTS lunc. REGISTERED PROFESSIONAL ENGINEERS 3131 FERNBROOK LANE NORTH MINNEAPOLIS, MINNESOTA 55441 612 /550-5511 Mr. Rufus Alexander, Manager Municipal Utilities 225 Michigan Street Hutchinson, MN 55350 February 11, 1983 RE: Utility Building Roof Hutchinson, Minnesota FEP , 1983 1. Dear Alex: We have revised our estimate for the built -up roof to include the Mansard treatment along three sides of the new roof and the installation of six interior roof drains. Roof drain piping would be installed above the suspended ceiling, down to below the floor in the area of the mechanical equipment room and would discharge below ground into the existing 24 inch storm sewer on the north side of the building. The revised estimate is as follows: I. BOND BEAM 1. Demolition Work $ 1,000 2. Concrete Block 1,100 3. Concrete Construction (A) Forming 1,980 (B) Reinforcing Steel 280 (C) Concrete in Place 1,800 4. Restoration of Roof Perimeter 660 Sub -Total $ 6,820 II. ROOF DRAINS 1. Install Six Roof Drains $ 600 2. Install Drain Pipe (A) 80' of 4" @ $17 1,360 (B) 80' of 5" @ $19 1,520 (C) 50' of 6" @ $24 1,200 (D) 60' of 10" @ $48 2,880 (E) Fittings, Hangers, Etc. 600 Sub -Total $ 8,160 Mr. Rufus Alexander Page 2 February 11, 1983 III. MANSARD ROOF 1. Framing 2. Sheathing 3. Roofing 4. Soffit and Trim Sub -Total IV. ROOF REPLACEMENT 1. Remove existing roof 2. Remove skylights - fill in openings 3. Replace damp insulation 4. Install tapered insulation 5. Install 2" rigid insulation 6. Install four ply membrane 7. Install roof gravel 8. Provide roof bond Sub -Total TOTAL $ 2,480 1,240 1,320 500 $ 2,700 1,500 1,000 7,710 1,620 18,900 400 1,080 $ 5,540 $34,910 $55,430 Please call if you have any questions or need additional information. We are looking forward to meeting with you on February 28th. Very truly yours, ASSOCIATED CONSULTANTS, INC. Carl L. Wardlow, P.E. CLW /gal 1 1 1 ,rr Aii.SSOCIATED '11II.ONSULTANTS I REGISTERED PROFESSIONAL ENGINEERS 3131 FERNBROOK LANE NORTH MINNEAPOLIS, MINNESOTA 55441 612/559 -5511 Mr. Rufus Alexander, Manager Municipal Utilities 225 Michigan Street Hutchinson, MN 55350 Dear Alex: Inc. arc 2 x,1941 December 23, 1982 RE: Utility Building Roof Hutchinson, MN As you suggested, we have given some additional thought to the pitched roof concept of roof replacement for the utility building. Enclosed are two prints of a perspective drawing of the building with such a roof, which may help you visualize the end result. We have added a mansard roof treatment at the north and south eaves to soften the appearance and to provide some weather protection for the doorways at the south side of the building. One of the advantages, not mentioned in our letter of November 24, 1982, that this type of roof would afford is additional space for storage or other purposes. However, utilization of this space would require construction of access stairs and, depending on the floor loading, a "beefing up" of the structural system. We have revised our preliminary cost estimate of this type of roof, to include the mansard treatment and a full gable at the west end of the roof. This estimate does not inlcude any provisions for utilization of the additional space. COST ESTIMATE Pitched Roof 1. Bond Beam A. Demolition work $1,000 B. Concrete block 1,100 C. Concrete construction (1) forming 1,980 (2) reinforcing steel 280 (3) concrete in place 1,800 D. Restoration of roof perimeter 660 Sub total $6,820