A REGULAR MEETING OF THE PUBLIC UTILITIES COMMISSION OF THE CITY OF VIRGINIA, MINNESOTA, WAS HELD AT THE OFFICE OF THE DEPARTMENT OF PUBLIC UTILITIES ON MONDAY, June 27, 2005, AT 4:45 P.M.

Commissioner Sipola called the meeting to order at 4:45 p.m.

Present: Commissioners Marks, Raukar, Park, Bloomquist, and Sipola.

Absent: None.

Also Present: Terry Leoni, General Manager; Sue Lalli, Supervisor-Public Relations; Dori Bergman – Supervisor-Accounting.

Moved by Raukar and supported by Park that financial resolution No. 5058 authorizing the first half of June 2005 payroll in the amount of $85,965.89 checks #43581 through #43605, and the bills dated June 25, 2005 in the amount of $1,486,452.55, checks #71690 through #71771 and the second half of June 2005 wire and electronic transfers be adopted and the minutes of the regular meeting held on June 13, 2005 be approved as presented. Motion carried.

Mr. Leoni reported that the Virginia/Hibbing Joint Biomass Project environmental permit should be here this week and the Purchase Power Agreement is still in the works. Due to recent legislation, the number of trees to be planted may be less than originally anticipated.

Management reported that the owner of 629 3^rd Street South had been contacted pertaining to possible purchase. Discussion on the purchase price was being considered by the seller and Management is awaiting a response.

Management reported that three employees bid on the position of Plant Electrician and interviews were held. Management requested authorization to award the position of Plant Electrician to Ray Pesavento. Moved by Marks and supported by Raukar to award the position of Plant Electrician to Ray Pesavento. The start date to be delayed until such time as the vacated position of Operator II held by Mr. Pesavento has been filled. Motion carried.

Management requested authorization to enter into a new three-year Natural Gas Services Agreement with Minnesota Power that will supersede the original Natural Gas Service Agreement dated April 22, 2002. Moved by Marks and supported by Raukar that Management be authorized to enter into a new three-year Natural Gas Services Agreement with Minnesota Power that will supersede the original Natural Gas Service Agreement dated April 22, 2002. Motion carried.

The financial operating statements for May 2005 were reviewed.

Additional interviews for the position of Director – Finance and Administration would be held Tuesday or Wednesday, June 28 or June 29, 2005. Moved by Marks and supported by Raukar that the meeting recess until immediately following the interviews on June 28 or 29, 2005. Motion carried.

Meeting recessed at 5:02 p.m.

carried forward

Public Utilities Commission

Meeting Minutes

June 27, 2005

Page 2

brought forward

Commissioner Sipola reconvened the meeting at 9:25 p.m. on Tuesday, June 28, 2005 immediately following interviews for the position of Director – Finance and Administration. Moved by Park and supported by Marks that William Hafdahl be offered the position of Director – Finance and Administration contingent upon his passing a pre-employment physical. The General Manager will negotiate a starting salary within the salary matrix for the position. Motion carried.

The Director of Human Resources and Safety reported that 128 applications were received for the open EDP Operator position. Once the interview process for the position has been completed, Management will present a recommendation for the awarding of the position.

There being no further business to come before this meeting, it was moved by Marks and supported by Raukar that the meeting be adjourned. Motion carried. Adjournment at 9:31 p.m.

ATTEST: APPROVED:

___________________________ ______________________________

Jerry Marks, Secretary Dr. Don Sipola, President