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Hibbing Public Utilities approves interim financials and multiple purchases; awards water‑main contract
Summary
Commissioners approved March interim financials, a small coal purchase from DTE Energy, domestic piping and valves under Buy America considerations, awarded a water‑main construction contract, and authorized a ground‑line pole inspection RFP and construction services agreement for the 2025 season.
The Hibbing Public Utilities Commission on April 22 approved interim financial statements for the quarter ending March 31 and a series of procurement and capital items to support plant operations and water‑system work.
General Manager Andy Peterson told the commission that for the quarter ending March 31 the utility reported $11,000,000 in revenue, operating expenses of $8,700,000 and operating income of $2,700,000. "Overall, change in net position stands at 2,400,000 compared with 2,100,000 same period last year," Peterson said.
After presenting the financials the commission approved a slate of purchases and contracts:
- A coal purchase for the Hibbing Renewable Energy Center from DTE Energy for $41,885 (price noted in discussion: $83 per ton). Peterson said the purchase is intended to ensure coal inventory is sufficient to cover a few cold weekends and performance testing. The commission approved the purchase.
- A domestic purchase of 1,000 feet of 4-inch schedule 40 stainless condensate piping from a domestic supplier, $40,990, selected to comply with potential Build America/Buy America funding requirements.
- Multiple NovaSpec purchases tied to a boiler blowdown and continuous blowdown project, including a cabinet commissioning for $30,993.91 and assorted automatic valves totaling approximately $55,800 across two separate PO lines; and two Fisher valves for $18,032.08.
- An award of the 2025 Ward Watermain capital improvement project to Vagalas Inc. in the amount of $3,038,585. Engineer Josh Steyer told commissioners the single bid was about 4% over the engineer’s estimate of $2,933,678.30 but within acceptable ranges and that Vagalas has completed similar work for the utility. The commission approved awarding the contract.
- Authorization to issue request for proposals (RFP 2025‑10) for a distribution ground‑line pole inspection program. Staff described the 2015 inspection program that identified more than 200 priority poles and said the RFP is a best practice to prioritize replacements. The commission authorized issuing the RFP to obtain proposals and return recommendations.
- Authorization of Bolton & Menk (construction management and design services) for the 2025 construction season and associated design work, including design of a 30‑inch water main segment. Staff said the scope and cost align with a larger-than-typical construction year.
Commissioners asked follow-up questions about rail costs for bulk fuel deliveries and alternative fuel sourcing strategies. Peterson and other staff said the current coal buy is operationally limited and not a strategic long‑range procurement; staff agreed to continue exploring lower‑cost fuel delivery options and possible rail spur alternatives.
Votes on the line items were taken individually; each purchase and contract was approved by majority vote.
