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, OCTOBER 24, 2005, AT 4:30 P.M.

Commissioner Sipola called the meeting to order at 4:35 p.m.

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

Absent: None.

Also Present: Terry Leoni, General Manager; Doug Ganoe – Director of Operations; Sue Lalli, Public Relations Supervisor; Bill Hafdahl, Director – Finance & Administration.

The General Manager reported that Commissioner Jerry Marks had submitted his resignation and would not be returning to the Commission, effective October 21, 2005. Moved by Bloomquist and supported by Raukar that a Plaque be prepared for Mr. Marks thanking him for his many years of service on the Utilities Commission. Motion carried.

Moved by Park and supported by Raukar that financial Resolution No. 5066 authorizing the payroll dated October 13, 2005 in the amount of $89,397.50, checks #43816 through #43839 and direct deposits #8454 through #8504; and bills dated October 11, 2005 through October 24, 2005 in the amount of $410,105.44, checks #72470 through #72552, and wire and electronic transfers in the amount of $703,800.68 and the minutes of the regular meeting held on October 10, 2005 be approved as amended. Motion carried.

Moved by Park and Supported by Sipola to appoint Commissioner Raukar as Interim Secretary of the Utilities Commission until the next election of officers in February 2006. Motion carried.

The General Manager gave an update on LEA activities over the past two weeks. The bond sale was completed – taxable bonds sold on October 18, 2005 and tax-exempt bonds sold on October 19, 2005; financial close from the sale is expected on October 27, 2005 with funds to the Trustee for LEA, Wells Fargo in Minneapolis, on October 27, 2005. Title to a small portion of the property where the Utilities’ office building is located was straightened out. LEA reached an agreement on the terms of the Construction Manager with Oscar J. Boldt Constructors. A construction meeting was held and Doug Ganoe and Terry Leoni are the contacts at the Virginia Utilities for Construction. Commissioner Sipola noted that the location of the wood yard is to be in Mt. Iron and contains no wetlands issues.

The General Manager gave an overview of the Quad Cities Tennis building plans as presented to him by Mr. George Erickson and Mr. Bob Prittinen. The Utilities has been requested to consider in-kind services for the project and install new service lines for gas and electricity to the building free of charge. The Department is looking into the request and will keep the Commission updated.

The Director of Finance, Bill Hafdahl and the General Manager, Terry Leoni, reviewed the current Department’s reserve fund of $2,000,000 and the investments being used for those funds. The current structure of the Reserve was reviewed. Management will prepare a resolution for the next Commission meeting covering the intent of the Reserve funds.

Management reviewed the current Facility Plan for the newly acquired property and buildings located adjacent to the Department’s office building location. It is anticipated that demolition of the unneeded structures will take place the end of this year and the beginning of 2006. Two storage buildings will be constructed and a fenced storage area will be constructed between the two buildings to house materials that do not have to be housed. The current employee parking lot located directly behind the office building will be enlarged. Construction costs will be included in the 2006 budget and construction plans will be reviewed with the City’s Street and Alley Committee. The Commission will be kept up-to-date on the progress.

Carried forward

City of Virginia

Public Utilities Commission

Meeting Minutes

October 24, 2005

Brought forward

Management reported that a successful applicant for the open Fireman position in the Power Plant has successfully completed a pre-employment physical and background check. After discussion it was moved by Bloomquist and supported by Park that the following postings be awarded: Ray Pesavento – Plant Electrician; David N. Olson – Operator II; Tom Mills – Relief Operator; Ken Hill – Fireman; Dave Swanson – Operator I; and Jeff Minter – Relief Operator and that Management be authorized to hire Charles Paradis to fill the open Fireman position in the Power Plant effective November 7, 2005 subject to the terms and conditions of the AFSCME labor agreement. Motion carried.

The financial reports presented were reviewed.

There being no further business to come before the Commission, Commission President Sipola declared the meeting adjourned at 5:55 p.m.

ATTEST: APPROVED:

___________________________________ ________________________________

Matt Raukar, Interim Secretary Dr. Don Sipola, President