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, SEPTEMBER 12, 2005, AT 4:30 P.M.

 

Commissioner Sipola called the meeting to order at 4:30 p.m.

 

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

Absent:   None.

 

Also Present:    Terry Leoni, General Manager; Sue Lalli, Public Relations Supervisor; Bill Hafdahl, Director – Finance & Administration; Connie Larson, Director of Human Resources / Safety; City Councilors,  Rob Raplinger and Dennis Lindberg.

 

Moved by Raukar and supported by Park that financial Resolution No. 5062 authorizing the payroll dated September 1, 2005 in the amount of $92,702.09, checks #43742 through #43767 and direct deposits; and bills dated August 24, 2005 through September 13, 2005 in the amount of $763,511.16, checks #72139 through #72265, and wire and electronic transfers in the amount of $75,015.32 be adopted and the minutes of the regular meeting held on August 22, 2005 be approved as presented.  Motion carried.

 

The August 2005 Monthly Injury Summary Report was presented and reviewed.

 

The General Manager reviewed communications regarding the Biomass Project. 

 

Moved by Park and supported by Marks that Resolution No. 5063 be approved.  Motion carried.  Be it resolved that the Department of Public Utilities, City of Virginia, Minnesota, Board of Commissioners has reviewed the following information pertaining to Resolution No. 5063:

 

              1.       Background

 

               Laurentian Energy Authority I, LLC (the “Authority”), a joint venture of  the Hibbing Public Utilities Commission (HPUC) and the Virginia Public Utilities Commission (VPUC), is proceeding with the financing and construction of certain facilities for the production of steam and electric capacity and energy from biomass fuel (the “Project”).

 

              2.       Documents Presented

 

              There have been presented to this Commission forms of the following documents and copies are attached to this Resolution:

 

             a.          Premises and Facilities Lease (the “Lease”) proposed to be entered into between the VPUC, as lessor, and the Authority, as lessee, whereby the existing VPUC generating facilities are to be leased to the Authority;

 

             b.        Operating and Management Agreement (the “Operating Agreement”) to be entered into between VPUC and the Authority, whereby VPUC will operate the Hibbing portion of the Project;

 

             c.        Steam Sales Agreement (the “Steam Agreement”) between the Authority and the VPUC, whereby the VPUC will purchase steam from the Authority as provided therein; and

 

             d.        Completion Guaranty Agreement (the “Completion Guaranty”) from HPUC and VPUC to Wells Fargo Bank, National Association, as Trustee for the Bonds to be issued by the Authority to finance the Project, whereby among other things (a) HPUC and VPUC each agrees to deposit with the Trustee $4,000,000 of its funds and the proceeds of the $4,000,000 loan to be funded by Iron Rouge Resources, less amounts expended directly on the Project, and (b) HPUC and VPUC each guaranty completion of the Project to the extent provided therein.



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              3.       Approval

 

              The Lease, the Operating Agreement, the Steam Agreement, and the Completion Guaranty are hereby approved and shall be executed by the Chairman and Secretary in substantially the form on file but with all such changes therein as may be approved by the officers executing the same, which approval shall be conclusively evidenced by the execution thereof.  The Authority’s interest in such documents may be mortgaged or assigned to secure the Bonds.

 

4.            Other

 

              The officers of the VPUC may take such other action as may be necessary or expedient to facilitate the financing and construction of the Project.

 

The Commissioners were asked to review the documents as presented and forward any changes to the General Manager before the next regular Commission meeting on September 26, 2005.  The final documents will be prepared for Commission signature on September 26, 2005.

 

Moved by Park and supported by Marks that the revised Department Customer Deposit Policy be approved as presented.  Motion carried.

 

A revised Travel Expense Policy was presented for the first reading of the second draft.  The Director of HR and Safety will present this Policy for the final reading and approval at the September 26, 2005 meeting.

 

After discussion it was moved by Park and supported by Raukar that the property located at 619 3rd Street South, Virginia, be purchased for the appraised value of $36,000.  Motion carried. 

 

The Director of Finance presented information regarding the process followed for payment of the Department’s Accounts Payable.  Information on expenditures covered by the Petty Cash account will be prepared and forwarded to the Commissioners for the September 26, 2005 meeting. 

 

Moved by Marks and supported by Raukar that the Director of Finance and the Supervisor – Accounting be authorized to attend the Caselle Annual Conference in Salt Lake City, Utah on October 11-14, 2005 at an estimated total cost of $2,468.25.  Motion carried.

 

Moved by Marks and supported by Raukar that two members of the Department’s Safety Committee, Lowell Jenson and George Croft, be authorized to attend the Minnesota Safety Council’s Annual Safety Day in Duluth on October 4, 2005 for an estimated total cost of $168.60.  Motion carried.

 

Moved by Marks and supported by Raukar that the Director of HR and Safety be authorized to attend the Society of Human Resource Management’s Annual HR Conference on October 17 and 18, 2005 in St. Cloud, Mn. for an estimated total cost of $576.90.  Motion carried.

 

Issues affecting coal prices and the status of the AMR Project were discussed.  The Midway area of Virginia is now being read with the new Automated Meter Reading System and installation of AMR equipment to the Pine Mill Court area is underway. 

 

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Councilor Lindberg mentioned that there had been no one at the City’s Street and Alley Committee meetings representing the Utility.  Department representation would assist in better coordination of effort between the City and the Utilities.  The General Manager indicated a request had been made to the City to send notification of the meeting times so the Utilities could ensure a representative attends Street and Alley Committee meetings in the future.

 

Councilor Lindberg requested the Department look at their current process of turning off only the electricity when a customer is turned off for non-payment. 

 

There being no further business to come before the public meeting, Commissioner Sipola requested the meeting be closed to discuss a personnel issue.  Moved by Park and supported by Raukar to close the meeting to discuss a personnel issue.  Motion carried.  The meeting went into closed session at 5:36 p.m.

 

At 6:15 p.m. Commissioner Sipola recessed the closed meeting to September 13, 2005 at 4:30 p.m.

 

Commissioner Sipola reconvened the closed meeting at 4:35 p.m. on Tuesday, September 13, 2005. 

 

At 4:50 p.m. Commissioner Sipola declared the public meeting back in session.  Moved by Raukar and supported by Park to approve the expense request from Terry Leoni dated August 31, 2005.  Motion carried.

 

Commissioner Sipola noted that there was no expense request to approve for Commissioner Marks at this time as the travel request dated August 15, 2005 and the reimbursement received by Commissioner Marks had been returned to the Department. 

 

Moved by Raukar and supported by Park to approve the expense request from Commissioner Sipola for the MMUA Meeting held August 8 through 10, 2005.  Motion carried.

 

Commissioner Park reported on the findings of the Commission’s Travel Audit subcommittee.  The following statement was made regarding the findings of the subcommittee: “As appointed members of the “Travel Audit” Committee we find: Due to the inconclusive and/or unsubstantiated nature of information we have gathered or been provided at this time, our decision and wish is to take no further action.  We would further ask that any and all further question of travel allowance expense be referred to the Utility Commission of a whole.”  It was determined that this was intended to cover travel expenses for Commissioners or the General Manager.  Employee expenses would continue to be reviewed by the General Manager.  Moved by Raukar and supported by Sipola to received and file this report.  Motion carried.

 

The General Manager requested clarification as to whether the travel expense reimbursed to and returned by Commissioner Marks should be accepted by the Department.  Moved by Park and supported by Raukar to not accept the return of the travel expense from Commissioner Marks and return the money to him.

 

Ayes:                     Commissioners Bloomquist, Park, and Raukar. 

Nays:                      Commissioner Sipola. 

Abstention:           Commissioner Marks.                                                                          Motion carried.

 

There being no further business to come before the Commission, moved by Park and supported by Raukar to adjourn the meeting.

 

Meeting adjourned at 5:00 p.m.

 

 

ATTEST:                                                                                               APPROVED:

 

 

_________________________________________                                ______________________________________

Jerry Marks, Secretary                                                                        Dr. Don Sipola, President