Marshall Municipal Utilities

Board Meeting Minutes

December 12, 2006

The Board of Public Works convened the regular session at 8:30 a.m. at the Marshall Municipal Utilities Business Office. Present were Mike Mills, President; Jim Heinzler, Vice President; and Charles Hird, member. Secretary Spencer Fricke was absent. Also present was Mayor Connie Latimer.

The agenda was approved as amended to make the Electric Production report the first report. The minutes of the previous meeting were approved as printed on a motion by Mr. Heinzler, seconded by Mr. Hird.

Electric Production Director Kyle Gibbs reported discussions will be held with EPA to try to get an extension on compliance with one aspect of the boiler MACT rules. The boiler tubes for Unit #5 have been installed and this unit is expected to go on line next week. There have been some problems with the new bags for the Unit #4 baghouse.

Administrative Service Director Ken Gieringer reported there was an error in the water rates approved at the last Board meeting. The error was in the rate for volume over 5 million gallons. On a motion by Mr. Hird, seconded by Mr. Heinzler, the Board corrected the rate for volume over 5 million gallons to $0.121 per 100 gallons, effective with billing after January 1, 2007.

Director Gieringer has been reviewing the electric revenue and costs. As of June 1, 2006, MMU became a member of MoPEP. When looking the numbers for the first five months with MoPEP, the current rates are 5.5% below ($850,000 annually) the rates needed to provide necessary cash flow. When factoring in capital improvements, the shortage is 9.4% ($1,450,000 annually). At this point, it appears it may be necessary to change the cost adjustment (currently –8%). This information will be updated after getting the sixth month of data with MoPEP.

Director Gieringer indicated a couple of changes will be made in procedures in the customer service area. After-hour connections between the hours of 10 p.m. and 7 a.m. will no longer be made unless it is an emergency, and the charge for tampering with a meter will be increased to equal the after-hours turn-on fee.

Environmental Services Director Ginny Ismay reported the continuing low flows at the Wastewater Treatment Plant coupled with an ongoing effort to control or reduce operating expenses has led to recognition of a need to evaluate the raw sewage and aeration basin pump station pump operations. The pump manufacturer has not been willing to help address this problem. Shafer, Kline and Warren will evaluate the situation for a not-to-exceed cost of $4,000. On a motion by Mr. Hird, seconded by Mr. Heinzler, the Board authorized the General Manager to accept a proposal from Shafer, Kline & Warren to review the raw sewage and aeration basin pump operations.

General Manager Paul Jensen reported APPA is encouraging municipal utilities to become members of the North American Electric Reliability Corporation (NERC). As a member, MMU would help select two representatives from one of 12 sectors. Being a member has no bearing on reliability compliance obligations or any responsibility to fund NERC. On a motion by Mr. Hird, seconded by Mr. Heinzler, the Board approved becoming a member of NERC.

Mayor Latimer wished the Board a Merry Christmas and expressed her appreciation to the Board for the job they do.

On a motion by Mr. Hird, seconded by Mr. Heinzler, accounts payable were approved and warrants ordered issued from the following funds:

	WATER OPERATING FUND		$	114,634.58
	ELECTRIC OPERATING FUND		$	401,223.67
	SEWER REVENUE FUND		$	 62,161.31
	INTERNET OPERATING FUND		$	  6,340.90
	NATURAL GAS OPERATING FUND	$	    207.12
	ELECTRIC CONSUMERS DEPOSIT FUND	$	        --

On motion by Mr. Heinzler, seconded by Mr. Hird, the Board adjourned the regular meeting at 9:10 a.m. to go into an executive session to discuss matters related to property acquisition (Mo. Rev. Stat. 610.021 [2], if authorized). Roll call:
Jim Heinzler yes
Charles Hird yes
Mike Mills yes