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, DECEMBER 10, 2007, AT 4:30 P.M.

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

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

Absent: None.

Also Present: Terry Leoni – General Manager; Bill Hafdahl–Director-Finance & Administration; Sue Lalli-Public Relations / Customer Service Supervisor; Councilors Dennis Lindberg and Rob Raplinger; customers Mabel Kruse and Judy Cimperman.

Customer Judy Cimperman addressed the Commission regarding steam service to her daughter’s property located at 712 4^th Street South, the fee to voluntarily disconnect from the City’s steam system, the steam service fee of $39 a month, and the high steam usage recorded on the steam meter. Ms. Cimperman noted she owns property at 511 10^th Street South and is in the process of preparing to disconnect that property from the steam system. Councilor Lindberg mentioned the Mayor-elect had contacted him just prior to this meeting about the matters being brought before the Commission by Ms. Cimperman. After discussion it was moved by Bloomquist and supported by Park to have Management follow policy as set for customers voluntarily disconnecting from the steam system and make any adjustment for excess consumptions following policy. Motion carried.

Customer Mabel Kruse addressed the Commission regarding water billed on her account. The amount recorded on the meter was extremely high and Ms. Kruse felt there was something wrong with the meter. Ms. Kruse stated she had met with Mr. Hafdahl and was told no rebate would be allowed to the amount of water recorded and billed. Mr. Hafdahl, Director of Finance & Administration, noted the water meter had been removed and tested and the meter had tested to within 1% variance. Mr. Hafdahl had intended to also review the matter with the Administrative Review Team prior to a final reply to Mrs. Kruse, but due to illness the Team had not as yet reviewed the matter. As the meter tested within 1% variance no adjustment was recommended to the reading. Ms. Kruse was also concerned that her electric meter was also replaced at about the same time. Mr. Hafdahl reported the electric meter had stopped recording correctly and was replaced. Moved by Bloomquist and supported by Petroskey that the Administrative Review Team review the issues and notify the customer of the findings.

Mr. Leoni reviewed two letters received from Technical Loss Adjustment – one on a claim in the Plant when water was found in oil was received and filed. The second letter on the #1 Turbine Over-Speed Incident claim is still open and Management is not looking to close the claim at this time.

Mr. Leoni reviewed a letter from the League of Mn. Cities on insurance coverage for the Department and LEA. The letter is in response to the Department’s letter to the League on steps taken by the Department on the implementation of a comprehensive preventative maintenance program in the Plant. The letter was received and filed.

Mr. Leoni reviewed a letter from the League of Mn. Cities pertaining to insurance rate increases and credits a utility insuring through the League could receive if they make certain improvements to reduce the risk of fire. Mr. Leoni noted that the letter addressed many of the items the Department had already conveyed to the League that are done in the Plant to reduce the risk of fire.

Mr. Leoni reported he had attended a meeting in the Cities last week regarding the Department’s open claim on arc/fire damage in the Plant on July 29, 2006.

Carried forward

City of Virginia

Department of Public Utilities

Minutes from December 10, 2007 Commission Meeting

Page 2

Brought forward

Moved by Bloomquist and supported by Petroskey that financial Resolution #5119 authorizing the payroll dated December 6, 2007 in the amount of $106,020.12, checks #45236 through #45257, and direct deposits #11402 through #11455; and bills dated November 27, 2007 through December 6, 2007 in the amount of $733,419.29, checks #77554 through #77663, and wire and electronic transfer in the amount of $77,329.42 be adopted and to authorize the payment of the second payroll in the Month of December 2007 and payment of bills dated the second half of December 2007; and the minutes of the regular meeting held on November 26, 2007 be approved as presented. Motion carried.

Mr. Leoni reviewed the November 2007 Monthly Injury Summary Report as presented.

Revisions to the current Application for Service Policy were presented for the second reading. Policy revisions include the requirement for all applications to contain the customer’s social security number or a federal tax identification number along with the presentation of a valid driver’s license or photo ID at the time of application. Waiver of the required customer deposit has been revised to require proof of ownership at the time of application. Policy revisions also reflect payment of all previous unpaid accounts owed by a customer prior to a new account being opened. Moved by Park and supported by Petroskey to approve the revisions to the current Application for Service Policy as presented for the second reading. Motion carried.

Customer accounts delinquent for three years, remaining unpaid, and the Department and/or RCB Collections have been unable to locate the customer and obtain payment were presented for write off at the end of December 2007. The list of unpaid accounts presented for write off at this time total $2,345.62. After review, it was moved by Bloomquist and supported by Petroskey to approve the customer accounts presented for write off at the end of December 2007 totaling $2,345.62. Motion carried.

Commission President Sipola reported a meeting of the Commission’s Finance Committee, a meeting of the Committee of the Whole, was held on Monday, December 3, 2007 at which time Management presented the Department’s Budget for 2008 for review. Moved by Bloomquist and supported by Park to approve the Department’s 2008 Budget as presented. Motion carried. Mr. Leoni reviewed the 2% (two percent) steam rate increase included in the 2008 Budget as presented and noted this increase was reviewed with the Commission and City Council. The budget also contained utility work budgeted to be done in conjunction with the City of Virginia projects set for 2008.

Mr. Leoni reported Management is currently working with the VRMC on a new five-year utility contract.

There being no further business to come before the Commission, Commission President Sipola declared the meeting adjourned at 5:26 p.m.

ATTEST: APPROVED:

_______________________ ______________________

Jackie Park, Vice President Don Sipola, President