MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF UNITED POWER, INC. WEDNESDAY, FEBRUARY 18, 2015 GENERAL President Douglas Pryce called the regular meeting of the United Power Board of Directors to order at 9:00 a.m. on February 18, 2015. The meeting was held at United Power Headquarters in Brighton, Colorado. Present were Directors Bill Berens, Virginia Buczek, Tim Erickson, Robert Grant, Elizabeth Martin, Brian McCormick, Ursula Morgan, Rick Newman, Douglas Pryce, Dave Rose and James Vigesaa. Chief Executive Officer Ron Asche and Executive Assistant to the Board Michele Sack were also present. Others present for the meeting were staff members Dean Hubbuck, Kim Marsh, John Parker, Mitzi Rea, Bryant Robbins, Antelia Salazar-Ball, Myke Weis and Troy Whitmore. INVOCATION/PLEDGE Director Buczek gave the invocation and led in the Pledge of Allegiance. AGENDA APPROVED President Pryce reviewed proposed guidelines for conducting Board discussion on agenda items during the meeting. President Pryce noted that under Director Forum of this meeting agenda, the Board will be discussing the outcome from the Audit Committee meeting which was held Monday, February 16, 2015. He also noted that under the agenda item Future Agenda/Meetings there will be discussion regarding the Board agenda format and a critique of the meeting discussion guidelines. A motion was made by Director Buczek, seconded and carried, to approve the agenda as presented. INTRODUCTION OF NEW EMPLOYEES Antelia Salazar-Ball introduced Nicole Glaser and Sara Strain as new employees of United Power working in the Member Services Department. Both are Member Service Representatives. CONSENT AGENDA The January 16, 2015 Regular Board meeting minutes and the January 28, 2015 Special Board meeting minutes were included in the Board packet for review. Director Berens requested that the minutes of the January 2015 Regular Board meeting minutes be withdrawn from the consent agenda after which Director Berens made a motion, which was seconded, to amend the minutes as presented. After discussion, the motion was withdrawn. A motion was made by Director Grant, which was seconded and carried, to approve the January 2015 Regular Board minutes as corrected. Director Morgan made a motion, which was seconded and carried, to approve the consent agenda for the January 28, 2015 Special Board Meeting minutes as presented.
EPA/TRI-STATE CLEAN POWER PLAN REVIEW Invited guests, Laura Farris, EPA Region 8 Climate Change/International Coordinator, and Barbara Walz, Tri-State G&T Senior Vice President Policy and Compliance, provided an overview on various aspects of the EPA s Proposed Clean Power Plan. They addressed Board questions. The Board recessed at 10:58 a.m. for a break. They reconvened at 11:08 a.m. ANADARKO 69KV PROJECT REVIEW CEO Asche discussed the progress being made on the contract discussions with Anadarko regarding the contribution-in-aid-of-construction payment to United Power for the 69kv project line extension work. Following discussion Director Erickson made a motion, which was seconded and carried, to adopt the following Resolution Authorizing Execution of a Letter Agreement for Electric Facility Construction. RESOLUTION AUTHORIZING EXECUTION OF A LETTER AGREEMENT FOR ELECTRIC FACILITY CONSTRUCTION WHEREAS, at its February, 2014 Board meeting, the United Power Board of Directors reviewed and approved a Revision to the 2014 Capital Budget to include projects necessary to serve new oil and gas loads being developed in Weld County that are indeterminate, and WHEREAS, the Southwest Weld County Expansion Project, (the Project ) is planned to include both transmission system and distribution system additions and improvements that will enable reliable electric service to be provided to the new indeterminate oil and gas loads as well as maintaining reliable electric service to existing loads in the area, and WHEREAS, Western Gas Partners, LP, a subsidiary of Anadarko Petroleum Corporation, has requested electric service facility installations to serve several new gas compression stations in southwest Weld County, and WHEREAS, a Letter Agreement between United Power and Western Gas Partners describing the project to serve this load, financial cost sharing requirements, and related responsibilities of the parties is being negotiated. NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors of United Power, Inc. authorizes management to execute the Letter Agreement, when deemed to be in satisfactory form as determined by management and legal counsel, and to receive payments related to the Project from Western Gas Partners, LP, a subsidiary of Anadarko Petroleum Corporation, in order to provide for the timely construction and in-service date of the sub-transmission system and distribution facility additions and improvements required for the provision of reliable electric service to the new Western Gas Partners loads being developed in United Power s service territory in southwest Weld County. - - - - - - - - - - - - 2
Jerry Marizza, joined the meeting at 11:19 a.m. 13 MW SOLAR PROJECT CEO Asche, Engineering and Rates Manager Dean Hubbuck and New Energy Program Representative Jerry Marizza discussed the financial benefits and risks to United Power of filing a Policy 115 application with Tri-State for the output of a 13 MW Solar Project, for which a Power Purchase Agreement (PPA) was discussed and approved at the October 2014 Board meeting, versus treating the energy output from the project as a load offset to purchases from Tri-State. If an application is filed and approved by Tri-State, United Power would receive a monthly bill credit and payments for Renewable Energy Credits (REC s). After discussion, a motion was made by Director Buczek, which was seconded and carried, that United Power file a Policy 115 application with Tri-State for the 13 MW Solar Project. Jerry Marizza left the meeting at 11:53 a.m. PROPOSED TRI-STATE BYLAW CHANGE During the January Board meeting, there was discussion regarding a Tri-State ByLaw change being proposed by the Tri-State Board of Directors. The proposed change was to Article VII Cooperative Operation, Section 2 Patronage Capital in Connection with Furnishing Electric Energy of the Tri-State By-Laws. A letter was drafted setting forth United Power s objections to the proposed change. A motion was made by Director Berens, and seconded, to approve the letter as drafted, to be signed by the United Power Board of Directors and sent to Ken Reif, Senior Vice President and Legal Counsel of Tri-State G&T and copies to Rick Gordon, Chairman of the Tri-State G&T Board, Mike McInnes, CEO of Tri-State G&T, and Ron Asche, CEO United Power. An amendment to the motion was made by Director Grant, and seconded and passed, to strike CEO Ron Asche as receiving a copy of the letter and substitute the Tri-State Membership. The original motion, as amended, passed. Director Erickson voted against this motion. At 12:16 p.m. the Board recessed for lunch. The Board reconvened at 1:18 p.m. APPOINT ELECTION CREDENTIALS COMMITTEE Director of External Affairs Troy Whitmore discussed the appointment of an Election/Credentials Committee for the upcoming Annual Meeting. The committee oversees the registration process and ballot tabulation procedures at the Annual Meeting. Following discussion, a motion was made by Director Newman, seconded and carried, to adopt the following Resolution Appointing Election and Credentials Committee: 3
RESOLUTION APPOINTING ELECTION AND CREDENTIALS COMMITTEE WHEREAS, the Annual Meeting of Members will be held Wednesday, April 15, 2015; and WHEREAS, it is important that our Election and Credentials Committee be assembled to supervise registration procedures and to resolve any dispute regarding said registration; and WHEREAS, the Election and Credentials Committee is also charged with overseeing the ballot counting process and settling related disputes. NOW, THEREFORE, BE IT RESOLVED, that the following members of United Power, upon their acceptance, are hereby appointed to serve on the Election and Credentials Committee with the duties and authority set forth above. Name Address District Carol Criswell 195 Valle Drive, Fort Lupton, CO 80621 East Terry Krayenhagen 28930 E. 160 th Place, Brighton, CO 80603 East Troy Norby 896 S. McKinley Avenue, Fort Lupton, CO 80621 East Shawn Wiant 2113 County Road 45, Hudson, CO 80642 East Frank Howell 204 South 5 th Street, Brighton, CO 80601 South Al Shivley 840 South 15 th Avenue, Brighton, CO 80601 South Mary Zink 160 South 17 th Avenue Drive, Brighton, CO 80601 South Diane Hoppe 16602 Antero Circle, Broomfield, CO 80023 West Dennis Reid 6227 Saddleback Avenue, Firestone, CO 80504 West Gina Rowsam 5517 Triple Crown Drive, Frederick, CO 80504 West Connie Sasse -Price P.O. Box 326, Rollinsville, CO 80474 Mtn. Steve Whiteside 31399 Highway 72, Golden, CO 80403 Mtn. - - - - - - - - - - - - 2015 STRATEGIC PLAN PRIORITIES At the October 2014 Board meeting, staff presented a summary of the primary goals and objectives for both of the 2015 Strategic Plan focus areas, Member Engagement and Power Supply. Within each of these two areas, staff developed action items directed at achieving the goals and objectives. A list of these action items, categorized in order of importance based upon feedback from the Board Members, was reviewed and discussed with the Board. The action items will be discussed in more detail during a future Board meeting. CEO REPORT CEO Asche reviewed his February 9, 2015 written report which was included in the Board packet. He stated that the physical inventory of United Power s electric distribution system in the area referred to as New Town Frederick is complete. The inventory is necessary for the Town of Frederick to proceed with its planned acquisition of the electric distribution system and service territory in New Town Frederick. 4
United Power and New Town Frederick will now begin placing a value on this inventory, which should be completed by the end of May 2015. He also noted that he and Dean Hubbuck met with Joel Bladow and a member of his staff to review the status of the planned transmission system projects in southwest Weld County to provide electric service to the expanding oil and gas industry. FINANCIAL REPORT CFO John Parker reviewed his February 9, 2015 written report which was included in the Board packet. He also reviewed the Financial Report for period ending December 31, 2014, which was provided as a handout at the Board meeting. He addressed Board questions. EXTERNAL AFFAIRS REPORT Director of External Affairs Troy Whitmore reviewed his February 9, 2015 written report which was included in the Board packet. He discussed several House and Senate Bills being considered by the State Legislature which are of interest to United Power and other Colorado electric cooperatives. He also mentioned the first reading of the Thornton Franchise Agreement between The City of Thornton and United Power will be held Tuesday, February 25, 2015 at 7:00 p.m. at the City of Thornton. If approved, the Franchise would be renewed for another 20 years. ENGINEERING/RATES DEPT. REPORT Engineering and Rates Manager Dean Hubbuck reviewed his February 9, 2015 written report which was included in the Board packet. He commented that Tri-State has resolved the main issues with CDOT and will begin the construction on the Phase III 115kv Transmission Line between our Bromley and Prairie Center substations around the August 2015 timeframe. He also mentioned that the Public Utilities Commission will be holding the 4 th in a series of meetings on Net Metering. This meeting will be held April 23, 2015 from 1-5 p.m. He and staff plan on attending this event. He addressed Board questions. Following the presentation of staff reports, Board President Douglas Pryce asked the Board their opinion of moving staff reports to the beginning of the Board meeting agenda. Following discussion, the consensus among the Board and CEO Asche was to leave staff reports on the agenda as is. AWARD PRESENTATION President Pryce presented a Certificate of Safety Achievement award which United Power received from NRECA for its dedication to employee and public safety and commitment to regulatory compliance and loss control practices. This award was received by United Power at the Colorado Rural Electric Association (CREA) Annual Meeting held in Denver on February 8-10, 2015. 5
At 2:53 p.m. the Board recessed for break. The Board reconvened at 3:08 p.m. EXECUTIVE SESSION Director Vigesaa made a motion that the Board go into Executive Session to discuss personnel issues, that being the CEO Evaluation. The motion was seconded and carried unanimously. The Board went into Executive session at 3:09 p.m. Attending were Directors Berens, Buczek, Erickson, Grant, Martin, McCormick, Morgan, Newman, Pryce, Rose, and Vigesaa. At 4:25 p.m. CEO Asche joined the Executive Session. The Executive Session ended at 4:35 p.m. and the Board went back into regular session with all Directors present. DIRECTOR FORUM Director Grant commented that he and other Board members attended the CEO Succession Planning class at the CREA Annual Meeting held in Denver on February 8-10, 2015. He came back with information from this class which will be presented at the next Board meeting. Director Erickson mentioned he and other Board members attended the Tri-State Rate Committee meeting as well the Brighton Economic Development Annual Kick Off/Networking Meeting, and the Southeast Weld and Fort Lupton Chamber of Commerce Banquets. Director Rose and Morgan attended the CREA orientation session for new Directors which was held during the CREA Annual Meeting. Director Buczek reported on the Audit Committee meeting which was held on Monday, February 16, 2015 at United Power Headquarters. TRI-STATE REPORT Director Newman reviewed his written Tri-State Board Report for January 2015 and addressed board questions. CREA REPORT Director Buczek reported on the Colorado Rural Electric Association January 2015 meeting and addressed board questions. WUE REPORT Director McCormick reported on Western United Electric (WUE) and addressed Board questions. 6
ROUND-UP FOUNDATION The Round-Up Foundation January Annual and Regular Meeting Minutes, Update and Year-to- Date Summary by Director District were included in the Board packet for review and discussion. WRITTEN REPORTS The following written reports were included in the Board packet for review and discussion. Absences and Regular Hours Worked New Memberships by District Report on Collection Activities MEETING SCHEDULE The next Regular Board Meeting is scheduled for Friday, March 20, 2015 at 9:00 a.m. at the Brighton Headquarters Office, 500 Cooperative Way, Brighton, Colorado. An Audit Committee meeting is scheduled for March 19, 2015 at 2:30 p.m. at United Power Headquarters. The Board briefly discussed plans for the September 10-11, 2015 Strategic Planning Session. The Board also requested information on future Tri-State G&T orientation sessions that Tri-State provides to Board members of their member co-ops. President Douglas Pryce declared the meeting adjourned at 5:14 p.m. ADJOURNMENT Michele Sack, Recording Secretary 7