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Video-1: youtube.com/watch?v=zQ2U6XqzmGM

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All right, I'll call order the public utilities commission meeting for Tuesday, July 28th, 2026. Uh the first item on our agenda is the consent agenda and I believe director Fleck has some comments on that. >> Yeah. Um commissioners, president, um I

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want to just call out two items that we participated in. So, one is um MMUA, Minnesota Municipal Utility Agency, um conducted an emergency preparedness exercise over at the community center. Um and it was a great experience. We got a lot of folks who it was their first

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emergency preparedness exercise, kind of that tabletop. And um I think there was a lot of learning. Um but of course, anytime you do one of those, you find areas to improve on. So, we have a we got a list of things that we need to button up so that we're prepared for um an event that we hope never happens. Um the other thing that I'd like to point

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out is that this morning um I gave a presentation as a part of the Chamber of Commerce's hot topics at the Civic Center. Um that was on the water and wastewater rate increase process. Um there were give or take about 20 folks there. I think just under 20 people um

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absolutely fantastic questions. Um good participation, really good discussion. Um you know hard-hitting questions but but honest and and good questions. I think Newm really showed well today um in their participation as a as a customer base and so I was really

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impressed we we we got through it. Um obviously nobody's excited about it but they understand that that um things need to be done. Um the two big takeaways that I wanted to pass along for this group um one of the overarching themes was um essentially talk to us more show

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us more of what's going on the conditions of our assets how things are going um where things need to be done. That was one of the comments um or I should say themes and another theme was um a preference to do more regular smaller rate increases rather than um

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holding off for a long time and and doing a big increase. Those were um I think the consistent themes that that we heard, but otherwise again very impressed by the folks that were in attendance and very thankful for their participation. [snorts] >> Fantastic. Probably great hearing from You said there was 20 or so.

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>> Yeah, I think just under 20. Yep. >> Fantastic. That's good. All right. Any other comments? Otherwise, I'll I'll entertain a motion on the consent agenda. >> I'll make a motion to accept the consent agenda. I'll second them.

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>> All right, we have a motion and a second. Is there any further discussion? If not, all in favor say I. I >> opposed. Motion carries. Uh, next up is our employee of the month recognition. >> President Visser, commissioners, um, I'd like to um recognize or or nominate um

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Kim Cipher at Samuelson as employee of the month for June 2026. uh when accounts when the accounts payable clerk announced her retirement, Kim was willing to take on additional responsibilities to help ensure a smooth transition. She took the initiative to learn the liquor licensing process uh

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which is important here in New and uh has successfully handled the the questions as they arose as well as completing the annual liquor license renewal process for all businesses. In addition to liquor licensing duties, Kim has absorbed other responsibilities and remains willing to assist answer questions and help train the new

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accounts payable clerk as needed. Um, with that, I would like to nominate Kim Ciphford Samuelson as employee of the month for June 2026. >> I'll make a motion to recognize Kim Cyphford Samson as employee of the month for June 2026. >> Second.

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>> All right, we have a motion and a second. Is there any further discussion? If not, all in favor say I. >> I. >> Opposed? Motion carries. Thank you very much, Kim, for your your your service. Uh, now, uh, Paul Becky's years of service. Thank you, President Visser,

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commissioners. Um, I'd like to offer the attached resolution um recognizing um Paul Bilki's um years of service. He's a boiler operator, first class with a first class A license um with the electric production department down in the power plant. He's been was with the

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utility for 5 years um and um is sailing off into the sunset. Um, if I should read the resolution into the record, if I can grab it. Do you guys have a copy of it? You can. Thank you.

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>> There you go. >> Oh, very nice. Actually, I'm wondering if you have to read this into my apologies. Sorry. >> Sorry, there's not a link on my screen. Um, I need somebody to offer the

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resolution, right? >> Yeah. >> Do I need to offer that or do we need >> No, it's just somebody just needs to offer the resolution. >> All right. Yep. >> I will offer the resolution commending Paul Bilkey boiler operator first class

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a license with electric production department for just under 5 years of service with the new on public utilities. >> I'll second that. All right, we have a motion and a second. Is there any further discussion? If all If not, all in favor say I. I.

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Motion. A resolution. Sorry. I need to offer up the resolution. >> Commissioner Skillings, >> yes. >> Commissioner Williams, >> yes. >> Commissioner Bugler, >> yes. >> Commissioner Shaughness, yes. >> And Commissioner Visser, >> yes. >> Motion carries. All right, the motion passes.

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>> Thank you, Paul. >> All right. Thank you all and thank you, Paul. Um, now on to old business. the wholesale electric supplier. >> Make my way up to the podium. >> Yep. Uh, President Visser, commissioners. Um, this is some old business that was

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brought up uh that began last year. and we're talking about the post2029 wholesale electric supply request for proposal update. So, a little bit of background. So, if you recall, Newan Public Utilities purchases wholesale electricity from H

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Heartland Energy of South Dakota. Um, as a reminder, our power plant that we have only operates when called on by the regional electrical grid operator or during local emergencies. Otherwise, it remains in standby. So, the power that we're receiving today, for example, is

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from that wholesale contract. It's a 20-year agreement and it expires on December 31st, 2029. Therefore, we need a new wholesale supply contract. I wanted to recognize that H Heartland has offered to extend the current agreement with some updates.

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Um, and New Public Utilities very much appreciates that offer. Um, but we want to go out and ensure that we're getting the best values for our value for our customers. So, as a part of doing that, we needed some expert guidance. The public utility commission, this body accepted a

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proposal from HDR Engineering for $168,000 for consulting services last August. HDR then subcontracted with a company called Energy and Environmental Economics or E3 for short. And those two

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are to help NWAM assess uh their excuse me, they're first to assess NWAM's electricity and ancillary service needs. Ancillary services um has to do with like um ordering power and the market, coordinating with the regional grid operator and regulatory compliance. Um

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developing a request for proposal to solicit applications for wholesale electricity, facilitate that RFP process, help us evaluate those proposals, and then finally present their findings and make a recommendation on who to enter um power contract negotiations with to this body. [cough]

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So, just a really quick timeline. I'll step through here. Um yeah, from October to March, uh the new on public utility staff worked on um developing that RFP. Um I saw the or I kind of worked on the final copy of that. Um when I first started, my first couple weeks on

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January 30th, 2026, our consultant um confirmed uh interest from potential biders. And that was a really big um benefit to NWAM for that consultant to have industry experience and go out and use their contacts to to sort of drum up interest in participating. Um, on April

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3rd, that RFP was issued to seven potential participants that had expressed interest in January. On April 16th, we hosted a pre-bid webinar just to answer some questions before they submitted their applications. On May 15th was the deadline for the utility to

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respond to any applicant questions. On June 5th, those applicant bid were bids were due. Those applications were due. Um and we also finalized the scoring matrix. So how we were going to score those so that we weren't um changing the scoring rubric after we received applications just to make sure that um

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everyone was was scored consistently. On June 26, we internally finished our non-cost scoring, so how complete the application was, what was in it, etc. On the 21st, um just here a week ago, we reviewed cost projections and

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preliminary scoring. Um, obviously I'm giving this presentation right now and I understand it's probably July 28th and not July 27th. My mistake. Um, in August and September we will I will be doing reference checks uh that we're putting with the applications and also um our

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staff will be contacting our um peers to you know to see what their experience is with other utilities whether it's Marshall or Rochester or or Mano or Wilmer or whoever. And then we'll also be conducting individual meetings with applicants um to go over some final Q&A as needed.

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The idea here is at the September 22nd uh PUC meeting that consultant will give a presentation on their findings on the scores and a recommendation on who the city of New or excuse me the public utility should enter negotiations with um to develop that wholesale power agreement for January 1st 2030 and

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beyond. So just to provide a a very very high level summary of the applications obviously we're still in a phase where we can't divulge who has applied or pieces of their application things like that for confidentiality. Again there were seven applications submitted um I

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think our initial goal was to figure out who's out there what other deals are out on the table who who could we work with and I think from that aspect it was successful. We had a diversity of applicants. There's joint action agencies. Um there's energy brokers or or energy developers that applied. So um

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we had a nice mix there. And then of course we had a wide diversity of proposals. And what that means are um things like do they offer fixed pricing where the price remains the same with some annual escalator or do you do pass through pricing where nuam pays whatever the market price is essentially and

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everything in between. Um we there were different electricity purchasing strategies whether you buy blocks of power by season and time of day or whether it's load following meaning they provide whatever you need on a daily b daily and hourly basis. Um there's that joint action agency membership. Some

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required or requested membership in their agency. Um some didn't. There were different contract lengths between 10 and 40 years. Um we let applicants know that all applications would be uh evaluated at 10 years. just from apples to apples sense. Um then there's how

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they comply with Minnesota's renewable energy standards. There's different ways that they comply, whether they buy um renewable energy certificates on the open market, whether they generate them themselves, etc. How they treat New's power plant. So New's power plant has a capacity of 72 megawatts. New itself

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needs to hold back about 45 megawatts. But the others uh other difference can be marketed on the open market. they can purchase it from themselves for their own portfolios if they have other parties that need it. There's a lot of different treatments of that. And then lastly, there's those ancillary services. So power scheduling with the

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grid operator, um billing um for those wholesale power, regulatory compliance, etc. Some offer a pretty um minimal amount of ancillary services and some have all the things that you could think of um energy efficiency programs, community de e economic development grants, etc. So there's a big difference

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in the packages that these these folks offer. When it comes to scoring, uh this is our our scoring weight that we ended up on. 40% for cost projections. Um 15% for the risk sharing, uh how much risk they take on versus how much new on public

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utilities takes on and the terms. 15% for that ancillary services package, what are they offering, 10% for renewable energy standard or renewable energy certificate compliance, 10% for their application completeness and accuracy. So we asked for them to do a

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lot of things in their application. Did they do it or not? Um and lastly 10% for the treatment of new alms generation. So how are they treating that? Are they wanting to buy the rights to it? Are they wanting to lease the rights to it? How much are they offering? Etc. etc. So one of the things that I want to call

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out here is that um Noom's current agreement as I just mentioned is 20 years. a lot changes in 20 years and there's a lot that we can't project and so a lot of this is about n is your strategy to navigate the unknowns. So I'll just walk through some of those. So um one of the things that I don't think

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people realize is that when we talk about the electricity grid um the United States is broken up into separate grids that have interconnections but they're largely separate grids. Newm is in the mid-continent independent system operator grid or myo. Um a number of

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years back uh you maybe remember in the news that the Texas electricity grid failed. Um that was the it's called Urkot um energy reliability something council of Texas I think is what it is. That's what their grid is. Out west they have Cal ISO. So there's different of

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these these subreional um electricity grids. We are in MYSO. Um Mso requires you to set aside a certain amount of electricity generating capacity for spikes in um electricity use. for example, in the last couple of days when it's crazy hot. So, um you have to have

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a certain amount of reserve on top of whatever you're planning to do. Then they do a loss of load analysis. So, for example, if you have a horrible winter storm, is your power plant able to produce what you say you're going to produce? If you have a solar field that you're putting onto the grid, does that produce what what you say it's going to

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produce on a cloudy day or do you have battery backup or whatever? And then of course there's seasonal accredited capacity and that's how much they say your power plant that you're contributing to the grid is worth this much. Those numbers change with some frequency. So knowing how much you need

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to buy above and beyond what your actual wholesale needs are is a moving target. Knowing how much value our power plant has on the open market is a moving target. And that kind of gets to the second bit of the future market value of our generation capacity. um 15 years ago

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that power plants generation capacity provides a lot of value to the city of New by being the ultimate backup you know locally speaking on the open market it didn't have as much generation because there was electrical generation capacity was overs supplied with data centers and the closure of coal plants

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there's now a much narrower margin between electricity demand and electricity supply so having our capacity is very valuable to some folks who need to be able to say they have generation capacity So the question is how long will that favorable pricing

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last? 5 years, 10 years, 15 years. Will it ever go away? We don't know. Then of course we have the price and transferability of those. They're called Rex, renewable energy certificates. So the idea here is if you look down on the bottom right, that's the timeline for um

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100% clean energy in Minnesota by 2030. um 80% free um carbon for public util carbon free for public utilities, 90% by 2035 and 100% by 2040. So right now new's primary electricity source comes from coal and wind. In order to comply

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with this, new has to purchase these renewable energy certificates from a renewable energy provider to offset the carbon output of that coal generation. As the as the amount of carbon-f free um electricity generation increases, you

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have to buy more of those wrecks or generate those wrecks yourself by having a solar field or a wind farm or whatever. As you can imagine, everybody's going to want those. So, the price is likely going to go up. How much will the price go up? We don't know. So if you look at a proposal that had that

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generates a lot of wrecks on their own, let's say the price of that portfolio is a little bit higher, but they generate their own renewable energy certificates. And you look at another propo proposal that maybe they have a cheaper cost today, but they don't generate a lot of their own wrecks. Well, the future price

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of renewable energy certificates determines whether one is a good deal over the other, right? So how do you know that? If any of you has a crystal ball, I would really, really love to use it. Then of course you have the cost of the renewable energy transition particularly coal retirement and battery energy

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storage systems they're called best. So you see these um shipping containers full of batteries that some utilities have near substations. That's battery battery energy storage systems. As those become cheaper um energy becomes cheaper. So how fast will those become cheaper? We don't know. And then of

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course there's coal fired power plant regulations and remediation. Um again new is partnered with H Heartland. Hartland has a coal plant down in Nebraska. Um, you know, there's regulations proposed for reducing mercury emissions, for dealing with um

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coal ash in ponds and containing that. There's um groundwater pollution remediation. There's all kinds of costs. Under the current federal federal administration, many of those rules are propo are are uh postponed or paused. Will the next federal administration restart those rules and those costs will

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increase? We don't know. again if you have a crystal ball. And then lastly, there's local electricity demand forecast. How much electricity will NUM need and how fast will it grow? Um if we bring in a large user like a data center, um there's behind the meter

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generation and that's really solar on people's homes for example. Um there's electrification timing. So how fastly how fast will people pick up heat pumps? How fast will they adopt electric cars? Those sorts of things. That changes the demand for electricity and the timing of that electricity use. And then there's

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demand response capability. So right now we don't have those smart meters in new that are able to bill by the 15minute increment. At some point new will get that capability and we will bill appropriately to where the highest demand highest costs will be charged

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accordingly. That's a number of years away but that's the direction the industry is headed and all the large uh large suppliers are there already. Um how will how will we implement that? Will we have a very soft demand response or will we have a very strong demand response? That's up to to future body

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PUC commissions. For example, um and then of course there's data center electricity demand growth and cost recovery. So whether a data center locates in NWAM or not, if they locate in a in an area where like one of those joint action agencies, let's say we join a joint action agency that serves power

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to I'm just making this up to Fairmont and a data center locates in Fairmont and all of a sudden that power company has to um spend a lot of money to serve that data center. Well, does the data center in Fairmont have to pay that or do they spread it across all of their customers including us? Again, I'm just

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making that up, but that's an example. So you can see that there are a significant number of unknowns that nobody could possibly say they know the answer to. The the key here for public utility staff and with the help of our consultant is figuring out how to choose

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the right energy supplier with the right contract to limit as much of that risk as possible for all of these unknowns. um ask me again in 20 years how we did but right now you know we're trying to understand which direction the wind is blowing read the tea lives all those

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different sorts of phrases so what are the next steps um in August to September like I mentioned uh before we will be contacting applicant references and utility peers to to learn a little about more of their experience and what questions we should be asking that we maybe don't know about. Um the PUC staff

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will conduct one-on-one applicant meetings for final Q&A as needed. So, if we as we narrow down who we might want to work with, there's probably going to be some more detailed questions we're going to want to ask. Um, in September 22nd, HDR and E3 will present their findings and a recommendation on who to

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move forward with to this body. Um, it's important to remind uh the PUC that uh this is the last task in the current consultant agreement. So, as we move forward, um there's going to be a request for funding to uh retain additional industry specific legal and

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consulting services to help us negotiate those contracts and make sure that we're protected um over the life of that 10, 20, you know, who knows, maybe 40-year um agreement if NewM decides to join one of these joint action agencies, for example. And finally, um PUC staff and

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consultants will negotiate the with recommended applicant or applicants. Um it's likely that the recommendation will be to move forward with a couple of folks so that we don't get um you know lose leverage in negotiation by selecting a single a single um uh counterpart. So um that will likely

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happen in the later part of this year and into next year. Um there's no telling how long that will go on, but I can tell you one thing. It needs to be complete by January 1st, 2030 so that the lights stay on. So um if you have any questions, I'm happy to answer them. I just wanted to give you a preview of

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what's going to come in the uh September meeting so that when they come you kind of have a feel for what we've been doing. And um we've been meeting with the consultant every other week since I've been here. So there's been a lot of time and effort gone into this process. But um it's it's challenging.

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So comments, questions? No. Okay. Thank you very much. >> Thank you. Okay, >> I'll entertain a motion to receive and order file uh the presentation, please. >> I'll make the the motion to order and

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receive filed the review of the presentation, ask questions, and provide input. >> I'll second. >> We have a a motion and a second. Um, is there any further discussion? If not, all in favor say I. I >> oppos. >> Motion carries. Um on on new business is

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the approval of the Artic Wolf um services subscription. >> Yes. Good afternoon, commission. Before you is to authorize the approval of the three-year quote provided by TSG for the renewal of our article of services and the addition of their managed security awareness platform in the amount of

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$89,998.15. Um so the overview of this is we have utilized article uh managed detection and response for multiple years. We moved to their Aurora endpoint a year and a half ago. Um and this quote would also involve moving to their managed

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security awareness platform which would replace a current solution we currently have. Um excuse me. So, in August of 2024, um the commission approved entering a three-year agreement with Article Wolf, which capped the uh the annual increase

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to 5%. Um the proposal here would be instead of entering a year three this year, we would start over at year one of three of an agreement, but it would cap that annual increase at 3%. >> And it is budgeted um at $84,750. It does come in a little bit over budget

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as we have moved from just Aurora endpoint to Aurora manage endpoint by the article sock. So >> concerns >> I'll make a motion to authorize the approval of the three-year quote provided by TSG Server and Storage Inc.

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for the renewal of Arctic Wolf Services, MDR, Aurora Managed Endpoint, and the addition of managed and the addition of managed security awareness in the amount of $89,998.15. >> I'll second that. >> All right, we have a motion and a

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second. Is there any further discussion? If not, all in favor say I. I. Opposed? Motion carries. Next up is a research pump. Thank you. Good afternoon, commission. Uh, my name is Jeremy Hillis. I'm the chief of maintenance at the wastewater treatment

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plant. Um, we are looking to purchase a spare recirculation pump for our um, biological phosphorus removal process. Um, the pump that's currently in there runs 24/7. Um, it's been installed since

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2010. Um we have um rebuilt it once just as a preventative measure and um at that time there the pump company had a a loner pump that we could use. They no longer have that option. So we thought um it

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might be best to purchase a spare pump so that um when we needed to do maintenance we could swap them out and keep the process running. um it doesn't take us long to lose our treatment if we lose that pump and um we

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just thought this would be a good idea. No, >> it makes a lot of sense from risk reduction standpoint. Thank you. Yeah, >> I'll make a motion to authorize the city manager to accept the quote from Electric Pump LLC in the amount of $59,693

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to purchase a backup recirculation pump. >> Second. All right, we have a motion and a second. Um, is there any further discussion? If not, all in favor say I. I. >> Opposed? Motion carries. Uh, next up is the portable generator. >> Yeah. So, the next item we're looking to

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purchase would be a portable generator um that we would be able to uh take around to our outlying lift stations in the event of an extended outage, power outage, or um possibly some prevent or some maintenance. Um the um we got a

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state bid from Ziggler Cat. Uh this was a budgeted item and um it came in under budget. I'll make a motion to receive an order filed the state bid from Sourcewell contract number 09222-CAT

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in the amount of $97,157 plus vehicle tax for a new Caterpillar portable generator. >> I'll second. >> All right, we have a motion to second. Is there any further discussion? Uh if not, all in favor say I. >> I. >> Opposed? Motion carries. Uh, next up,

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thank you. Next up, Bian. >> Uh, yeah, this is the preliminary engineering for our bullower project and the addition of a backup generator for the wastewater treatment facility. Um, we've got currently have four blowers out there. Two of them are

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original plant in 1974. The other two were installed new in 2010, but of course those are 16 years old and those have been the workh horses for the last 16 years. This is to evaluate,

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do some preliminary engineering design, data collection. I put a whole list of the different services we're doing, but the big key here is we're moving this ahead. This was in the budget for next year to start, but we to meet the

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deadline to get on the project priority list, we need preliminary engineering plans and specs done before March. >> And that'll that will allow us to alternate funding. Alternate funding could be low interest loans, possibly grants. We're going to look for

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anything we can get, but the key is you got to be on that list before you're even eligible for any of that mechanisms. So this is the work to understand if the replace the 1974 blowers. Is that correct? >> We are going to evaluate and potentially

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how everything works out. We may revisit the ones in 2010 too. >> Okay. >> Or if they will be moved to more of a backup role or what it's that's part of the >> the reward or the >> preliminary design is kind of a what's the most cost effective way we're going to do this project for the long-term

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health of the facility. >> Yeah. President Fisser, if I may. Um, and getting on that project, uh, priority list is very important. Uh, the total cost of this work may be in the range of 5 to$10 million, which is going to very

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likely require some sort of, um, loan. And so, getting a low interest loan for work like this is really important. So, um, that's one of the reasons why we want to be ready to go in time for that March application deadline. >> So, if we miss that, would it go all the way to the >> the following year? >> The following year?

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>> That's right. likely gets more expensive at that point. [laughter] >> Yeah, it never stops getting more expensive. >> Okay. >> I'll make a motion to authorize the city manager to accept the quote from Bolton and Mink in the amount of not to exceed

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$173,200 to prepare preliminary engineering for blower improvements and a backup generator at the wastewater treatment plant. >> I'll second them. All right, we have a motion and a second. Uh, do we have any further discussion? If not, all in favor

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say I. >> I. >> Opposed? Motion carries. Uh, Paul, I think you're up next. Thank you, Dan. >> Good afternoon, commissioners. Um, for you is a receive an order file for

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purchasing a uh VFD to replace a failed um piece of electronics in our water treatment plant. Um, this device, it actually starts and stops the blower. Uh, it's original equipment, 1994. So,

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uh, without it, we're running on one blower. Uh, right now, we're um we're running [snorts] pretty hard at the plant. The the plant is running almost 24/7, and we're doing at least one to two back washes a day, uh, every single day. And

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without the blower, we can't do the back washes. So, uh, we did go ahead and and get this on order and and, uh, it's actually installed already, but just wanted to let you know that, you know, critical equipment and didn't want to

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run the risk of not having that blower. Um, if we if we ran out on our our second one, then we're we're done. We got to shut the plant off. So, um, just wanted to let you know. >> Yeah. Is there is there other items like

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this where there may be critical spares to have on the shelf? I mean, it's overall it's somewhat expensive, but it's not extremely costly to >> Yeah. >> keep them back up. >> Uh, and we're taking a hard look at our budget and our 10-year CIP and considering all those things and and we

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do want to start having some of these things on the shelf. Um, but right now we're we're trying to just >> like I expressed when I when I first started, this is our discovery time. So, we're still in discovery. >> Understood. Thank you.

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>> All right. I'll take a motion on that. >> I'll make a motion to receive an order filed to quote from Viking Electric in the amount of $9,400 for emergency repair of the water treatment plant's air blower number two variable frequency drive. >> Second.

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>> All right. We have a motion and a second. Is there any further discussion? If not, all in favor say I. >> I. >> I. >> Opposed? >> Motion carries. Last up. Is there a report of claims? >> Take a motion on that. >> I'll make a motion to accept the list of

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claims in the amount of 3,816,199.73. >> I'll second. >> All right. We have a motion, a second. Um, is there any further discussion on that? If not, all in favor say I. >> I. I. opposed. Motion carries. Uh do we have any additional comments today from our commissioners? If not, we're

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adjourned. Thank you everybody. You