Hutchinson pipeline gets OK from state PUC

New Ulm PUC plans 5-mile

connecting line

By RON LARSEN

Journal Staff Writer

NEW ULM -- Now that Hutchinson Utilities Commission has received the certificate of need for its natural gas pipeline project, discussions between the HUC and New Ulm Utilities Department are moving into high gear, the New Ulm Public Utilities Commission was told Wednesday night.

Interim Utilities Director Dan Sonnek reported that a Utilities Department delegation traveled to Hutchinson Wednesday to discuss New Ulm's involvement in the 89-mile pipeline project. The Utilities Department is planning to build a 5-mile connecting line with $800,000 from its reserves.

"Hutchinson Utilities has the Minnesota Public Utilities Commission's certificate of need in hand now," Sonnek said. "The only thing standing in the way is the 20-day period for raising objections, but Hutchinson doesn't believe there will be any problems."

He said Hutchinson Utilities believes the Environmental Quality Board will set the route as originally proposed, clearing the way for construction.

"We're continuing on our end to do what needs to be done to meet our obligations."

The commission also approved the department's 2003 budget which projects a slim net income of $190,277 on revenues expected to total $28,661,997. Operating expenses are expected to total $28,407,720.

While the net is small, the budget projects unrestricted cash reserves at $10,807,398 and "target" reserves at $11,666,300, meaning that nearly 80 percent of the 2003 budget is covered by cash and target reserves.

Sonnek also reported the department had a net loss of $557,503 in November. The 2002 budget projected a net loss of $315,133. The department's net margin for the year-to-date is $1,096,586, over $300,000 less than the budgeted net margin.

Much of the November loss came from the net loss of $225,117 suffered by the Electric Division. Its net margin for the year-to-date stands at $872,690. That's about $120,000 less than the budgeted year-to-date net margin.

Purchased power costs put the division behind the eight-ball, Sonnek reported, because "our broker was buying for a full load and not taking into consideration our own generation." He said that is being corrected.

The commission approved a 2 percent across-the-board increase in District Energy Fund usage rates which hadn't been increased since 1996, a 5 percent rate increase in the Water Division, and a 10 percent increase in wastewater treatment rates. Both water and wastewater treatment rates were increased in 2002.

After considerable debate, the commission decided to send a proposed ordinance revision regarding municipal utility service outside the city to the City Council for action. The revision involves extending utility services to premises already under contract for services from the city.

Finally, Commissioner James Schuetzle was named to the commission's personnel committee to replace Commissioner William O'Connor whose term on the commission ends this month.