LINCOLN PIPESTONE RURAL WATER SYSTEM
East Highway 14, P.O. Box 188, Lake Benton, MN 56149
(507) 368-4248 or (800) 462-0309
fax (507) 368-4573
email: lprw@itctel.com
MEETING MINUTES
November 25, 2013
The regular scheduled meeting of the Lincoln Pipestone Rural Water (LPRW) System Board of
Commissioners was held at the LPRW office in Lake Benton on Monday, November 25, 2013
starting at 10:00 a.m. Chairman Rod Spronk called the meeting to order with Commissioners
Earl DeWilde, Frank Engels, Joe Weber, Bill Ufkin, Jan Moen, Norris Peterson, Ken Buysse,
Jerry Lonneman, Mitch Kling and Brent Feikema present. Also present were Board Attorney,
Ron Schramel; DGR Engineer, Darin Schriever; Liesch Hydrologist Jim DeLambert: Field
Superintendents, Shawn Nelson and Tom Muller and CEO, Mark Johnson. Joining the meeting
late was the Honorable and former Commissioner of LPRW Irvin Vandergrind, introduced by
Spronk.
His former service to LPRW was acknowledged and appreciated.
Agenda: M/S/P-U Lonneman/Moen to approve the Agenda.
Minutes: M/S/P-U Ufkin/Feikema to approve the Board minutes of October 28, 2013.
Treasurer's Report: M/S/P-U Engels/Peterson to approve the Treasurer’s Report. The CEO
pointed out that the revenues are slightly ahead with the budget but sales to Worthington make
this possible and these sales are now beginning to move upwardly. Expenses are over budget of
about $148,000 attributable to one time type costs in maintenance, etc. Labor expense is down
about 4%.
Pending Bills: M/S/P-U Ufkin/Lonneman to approve the following bills for payment:
 DeWild Grant Reckert and Associates Company: General Services #145 = $20,694.26
and includes CAPX billing; New Water Source Development – ppe #64 = $2,814.90
 Schramel: General Legal Services = $ 2,580.40 and CapX = $512.00
 Liesch Associates: Wellhead Protection Plan = $10,965.53
 Healy Consultanting: General Services = $2,611.43
 Carstensen CapX Final Payment = $52,737.59
 USDA: Loan Code 91-24 = $471.750.00; Loan Code 91-26 = $259,050.00; Loan Code
91-28 = $218930.00; and Loan Code 91-29 = $38,155.00
 US Bank: Lincoln County Series 2005A Bonds #801337800 = $352,511.25; Yellow
Medicine County Series 2008 Bonds Account #802315600 = $250,802.51; Lincoln
County Series 2012 Bonds Account #803175100 = $120,500.00
 Northland Trust: Nobles County Series 2012A Bonds = $146,838.75
 Steffl: South Dakota Verdi Wellfield Development Invoice # 151244 = $12,959.21
Hydrologist’s Report- South Dakota Wellfield: Jim DeLambert of Liesch that there are two
permits in South Dakota- Permit # 7392-3 for the two wells being developed for 200 mgy (614
acre feet; 1200 gpm or 2.67 cfs) and Permit # 7393-3 for the two future wells for 200 mgy and
will need to be renewed 5 years from the time of permitting to keep it viable. The CEO will
need to develop a system to remind LPRW to timely renew this permit. DeLambert discussed
the water quality at each well during the 72 hours test and how the nitrates escalated somewhat
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during the test and there will be a need to monitor for such whether the South Dakota wells are
placed into service or not.. He reviewed the historical data of the area against this test. Test hole
inorganics were reviewed. Water level draw down charts were presented and showed 1 foot of
draw down on MN DNR observation well with all the MN and SD wells running wide open
(2700 gpm and 2350 gpm, repectively) which he stated is not a lot of effect. DeLambert related
that when there are dry conditions there could be trouble getting sufficient water but this aquifer
recharges quickly from rains and runoff. Liesch has well combination scenarios to follow during
dry conditions and aquifer draw down so as to optimize production while preserving aquifer
resources. But still dry conditions are a wildcard. DeLambert will provide this production-well
use scenario to LPRW. But notably LPRW has survived several drought years in its history.
Discussion ensued as to what is the cap that can be gained in the future from South Dakota and
what is the real expectation from these new wells in addition to operating with the existing wells.
Also discussion ensued about MN DNR reducing MN permitting to LPRW. Schriever pointed
out that permit reduction to one site can be problematic as LPRW and other rural water utilities
cannot move water around to other service areas to bridge such a loss gap, rather they serve
specific service areas. Then DeLambert cautioned beware nitrates can go up but try and prove it
out with these new wells. Discussion also ensued as to if a better South Dakota well should be
found in the future would the lesser producing South Dakota well #2 be abandon. No, because a
variance may be sought to the permit to include a diversion permit well and give operational
flexibility. Keep what you have.
Water Systems Clerk Report Written: Connie Bressler, Water Clerk, reported in writing on
the progress of online bill payment for the LPRW customers. Email addresses being a part of the
information to be provided to make online payments would likely be able to be transferred to the
BDS system utilized by the office staff. The contract can be terminated on 30 days’ notice as
there is no monetary exchange for the contract. Revtrak will not cap rates and thus the 3.49%
charge will be charged on the total bill. If LPRW does differently, it must not exceed the 3.61%
cap according to credit card rules and regulations. The turn around for review of payments is
instantaneous to determine if the payment is good and that it is a clear payment and then is
dropped into the bank the next day.
Attorney’s Report: Ron Schramel presented that the LPRW officers’ elections will take place
next month. Also he related that there are some $1,250,000 in assessments to be heard
December 18th at the Lyon County Court. 12 individuals have fully paid some $197,000.05 and
more may fully pay before the court date. There are some 67 properties over the 10 county
service area to be assessed. This is down from previous years of 2010 -117; 2011- 240; 2012133 but is approaching the 800 number required for the ’08-’10 expansion. He attached a list as
to individual properties by county, Jackson -5, Lac Qui Parle – 3, Lincoln – 6, Lyon – 11,
Murray – 5, Nobles – 22, Pipestone – 2, Rock – 1 and Yellow Medicine -12.
Engineer’s Report: Darin Schriever discussed the following items:.
New Water Development:
• City of Madison: Nothing new to report.
• City of Dawson: Dawson is preparing a draft proposal.
• Garvin Area: Red Rock RWS’s test drilling results were disappointing. RRRWS plans to
move to the Currie area along the Des Moines River and test drill there.
• Verdi and New Wells: New Wells-- Reference the report by Liesch. The water quality
report is incomplete and will need to be reviewed when the test results are available. There
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is reasonable new capacity to be added at Verdi from the South Dakota wells and Schriever
is onboard that currently a water treatment plant is not necessary and the need thereof can
be determined after the wells are proven.
Verdi and CIP—A new ground storage reservoir (GSR) and high service pumping station
(HSP) need to be installed at Verdi as the current pump station is old and has limited life
and service remaining. A new GSR and HSP station will enable water to be sent in all
three directions LPRW will be sending this water in the future. Verdi to Lynd pipeline is
phased into two parts and would eventually carry 0.5 mgd to the Lynd Stand Pipe. Phase I
- the Tyler to Lynd pipeline fixes pressure problems along this area as it is a bigger conduit.
Though it has some extra capacity this first phase is limited to supplying the Lynd Stand
Pipe during non peak use days. This phase allows some transfer of waters to the Burr
service area. It utilizes the existing pump system- Pump Station #1 and the Lake Benton
Reservoir.
Schriever presented that there is a need to have a water plant site acquired at Verdi at least
for iron/manganese removal to make MN Verdi well #5 viable. Also he needs a good place
to which to design the piping necessary to bring all the wells together for pumping and
should a water plant be needed. The Board has asked Muller and the CEO to see about
acquiring land for this.
Big Sioux CWS: DGR developed a preliminary hydraulic layout to incorporate a potential
Big Sioux water source, but the source would be very expensive.
Preliminary Engineering Report: The PER is still progressing but is a moving target, but
hopes to present it by January 1.
Holland WTP: Work remains under The Biottta pilot testing. Plans are to re-start the
system in December with new media, allow for acclimation, hopefully much faster because
of previous test experience; then perform manganese removal testing. The plan is still to
design and construct the full scale equipment in the winter of 2014/2015 and be operational
in Spring of 2015.
Miscellaneous Work: Also as a part of the CIP there are several areas in the South of the
LPRW system that will be looked at for low flow and/or low pressure problems to be fixed
with small main installations.
 General: The Hydraulic model update is done.
 Osceola capacity test shows able to get 1225 gpm and can move 600 gpm to Worthington
and intermittently 500 gpm pumped from Lismore Booster to Chandler Tower. It was
noted that during peak months Worthington should be cut back so that Osceola water can
be pushed further North and West and then allow Edgerton to pump west to avoid low
pressure problems. The economics of temporary loss of waters sales to Worthington are
more than balanced by not constructing and paying over 40 years a costly pipeline to
solve this problem otherwise since Worthington is not likely a long term customer.
 CapX Pipeline Relocation- the construction is basically complete. Clean-up items are
being worked on and final quantities are being gathered. Schriever recommended change
order #2 be approved. This change order reflects that the unit quantities are less than
estimated and lowers the cost about $30,000. M/S/P-U Weber/Kling to approve Change
Order # 2.
Lewis and Clark: Worthington approached LPRW regarding a potential joint project
which would deliver L & C water from the Hills, MN area to LPRW and Worthington.
DGR has developed a very preliminary design, options and cost estimates which were
presented to the Board. The Board was of the consensus that a “wait and see” approach
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be taken until the Minnesota State Legislature has had opportunity to convene and take
any action on the L & C bonding request.
Red Rock Rural Water System and LPRW Potential Joint Project: When RRRWS
indicated that the Garvin well drilling results failed, Mark Johnson, CEO meet with DGR
to see if there were ways LPRW could help RRRWS and thus a meeting with RRRWS
was set up. The Verdi pipeline will not carry enough water and what water it has needs
to help the Burr service area. An up size in the piping in the Verdi Phase I and II projects
with a main to where RRRWS wants water is too expensive plus both phases would have
to be completed before water would be available. However, LPRW could with Holland
becoming re-viable then be able to provide water wherewith a 12 inch pipeline would go
from the Holland plant some 26 miles east to RRRWS and furnish 250,000 gallons water
per day. RRRWS will eventually want a total of 500,000 gallons per day. This pipeline
carries water basically downhill over the ridge and will not need a pump station. The
cost of the pipeline is about $4.4million dollars and RRRWS would need as to ultimate
use 42% of the main’s capacity. The current LPRW capacity charge is $6.50/ gallon but
needs to be looked at. Splitting the cost in pipe based on RRRWS’s ultimate capacity
and RRRWS only buying the current capacity LPRW would still need about $800,000 of
funds to pay its portion of the main. Either more capacity bought now by RRRWS or
higher capacity charges would cover the LPRW deficit. Also an important part of
starting at the Holland water plant is that this well field has the capacity to be expanded.
Also just as importantly there is in the long range plans to install a pipeline between the
Verdi to Holland facilities. Then water could be transferred either way. Thus Verdi
which looks good for more production now with South Dakota wells could supplement
Holland without expensive water plant expansion. Kling suggested that when RRRWS
needs more capacity in the future that it be assessed a portion of the cost of this
interconnection pipeline and that RRRWS be made currently aware of such. Then
discussion followed that this project would make viable a south-north pipeline from
Chandler to Russell. Thus it followed that the Russell-Lynd pipeline currently be upsized
from an 8” to a 10” which DGR will include in the Phase I design.
Field Superintendents’ Report:
Tom Muller related that there 11 services put in in the south 4 in 2013. Most of the
Nobles County Road Restoration Project has been satisfactorily completed.
Shawn Nelson stated that he had 2 services left to install. The work at the Minneota
Building just started as the rafters were only delivered last week.
CEO’s Report:
 Lincoln County Bond refinancing- The results showed a 1.84% effective rate and
$300,000 present worth savings. A Resolution was presented for signing which on M/S/P-U
Weber/Kling to approve and sign the resolution. Discussion followed about how well these
bonds did compared to the Nobles County Refinancing. This fact was attributed to the fact
Ehlers acted in a single capacity rather than a dual capacity of buying and selling the bonds
compared to Northland. It is the consensus of the Board that Schramel and the CEO visit
with Nobles County Officials as to this disparity.
 Nobles County Bond refinancing- The CEO presented a certification to be signed.
M/S/P-U Kling/Buysse to approve signing the certification
 The City of Wilmont has paid its hookup and capacity fees of $286,130.00.
 The Wellhead Protection Part 2 meeting took place on November 18th.
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 The Truck bids were revisited as the trucks quoted by Billion were sold between the time
of quote and the acceptance by LPRW. Billion requoted other vehicles with more
comprehensive equipment as desired by LPRW and still Billion was low bidder as to each
and every truck. M/S/P-U Buysse/Engels to accept the revised bids.
 The Christmas party was canceled. The CEO will notify everyone about this.
 LPRW should not participate in the FSA balloting.
 Weber reported Keith Houselog requested a rent refund and reduction for 34 acres of
unusable lands due to weed growth he rents from LPRW. This is a reasonable request.
M/S/P-U Weber/Buysse to approve the rent refund for last year’s payment and reduce the
rent for two more years afterwards Houselog is responsible for the land and paying all the
rent.
Committee Reports:
• Executive Committee:
• Personnel Committee: Shawn Nelson had submitted a letter to the Board via the Personnel
Committee to extend indefinitely his needing to take and pass Grade B licensure. It had been
pointed out Nelson had until the end of 2013 when promoted to accomplish this fact.
However, the new recommended Senior Operators position allows three years to get a Grade
A license upon entry and that Nelson should be given the same amount of time. Also
discussed was the fact LPRW is now a Grade A rated utility and superintendents should be
licensed at that grade especially if they supervise personnel in positions that require Grade A
licensure. Then discussion ensued as to how to require Nelson to get the Grade B and then be
required to get the Grade A and if not what would the penalty be. Currently Nelson’s pay is
at a lessor step due to not having the required licensing. The CEO will look at the Personnel
Policy Manual and make recommendations for the next Board meeting. M/S/P Engels/
Buysse with Weber voting no to give a one year extension to Nelson to acquire his Grade B
licensure.
• Budget and Finance Committee:
• Water Resources & Equipment Committee: M/S/P-U Ufkin/Buysse to accept the October
28th Committee minutes.
• MRWA Director:
Other The Water rates recommendation were reviewed and discussion ensued whether the
health department fee is part of the rate structure and that if it is to go up it needs to be passed on
to the customer accordingly. Also the highest tier should be eliminated and the next lower tier be
the highest rate applied to all usage above 20,000 gallons/month. M/S/P-U Feikema/Engels to
eliminate the top tier and begin the new top tier at 20,000 gallons/month starting next July.
M/S/P-U Buysse/Ufkin to set the new rates as recommended at 5% with the 50,000/month and
above tier removed and replaced with 20,000/month and above for bills to be paid in July, 2014.
The Budget, CIP, Personnel Salaries matter was deferred to be discussed in December due to
Egineering recommendations concerning Verdi. The CEO will provide more complete
information as to Personnel Salaries recommendations via email to the Board members.
Public Comment:
Adjournment: M/S/P-U Ufkin/Kling to adjourn the meeting at 3:30 p.m. The next Regular
Board meeting will be Monday, December 16, 2013 at 10:00 a.m. as previously scheduled.
___________________________________________Janice Moen, Secretary
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