June 2007

LA PLATA ELECTRIC ASSOCIATION, INC.
Durango, Colorado

The regular monthly meeting of the Board of Directors of La Plata Electric Association, Inc. was held Wednesday, June 20, 2007, in the Community Center in Pagosa Springs, Colorado following the PURPA hearings. Director Cole led the board in the Pledge of Allegiance. President Patton thanked everyone involved in setting up for the off-site meeting.
President Patton called the meeting to order at 9:32 A.M. with the following directors present:

Also present were:
Greg Munro, Chief Executive Officer
Barry Spear, Attorney
Dan Hammond, Chief Financial Officer
Steve Gregg, Manager of Operations
Ron Meier, Manager of Engineering
Mark Schwantes, Director of Corporate Services
Linda Wilsey, Executive Secretary

Guests: (As listed on the sign in sheet)
Josh Joswick      Genelle Macht         David Begay

AGENDA
President Patton asked if there were any additions or changes to the agenda. One director requested a quick tour of the Pagosa Springs office following the board meeting.

CONSENT BOARD ITEMS
The consent board items were presented and reviewed.

ITEMS REQUIRING BOARD ACTIONS
Director reimbursements were presented and reviewed.

Committee of the Whole 6/18/07

Administration Committee

Budget Finance & Audit Committee

Systems' Operations & Planning Committee

Board Meeting 6/20/07

Meetings

TRI-STATE MEMBER MEETING
President Patton addressed the August 2007 Tri-State Membership Meeting being held in Westminster, Colorado.

CEO REPORT
CEO Munro expanded on his written report, noting that there will be a 5% increase with our Federated insurance policy for the next year. He answered questions on his report.
Mark Schwantes gave a Power Point presentation of the second quarterly update on the energy efficiency and conservation program. He showed the 2007 goals for Green Power, Energy Efficiency, Renewable Energy, and Sponsorship & Events.

SYSTEMS' OPERATIONS & PLANNING COMMITTEE
Director Goff reported the committee addressed a contract with a major industrial customer. Resolution 2007-04 would approve entering into an agreement between LPEA and Williams Four Corners LLC.

The next item was review of an underground easement for Bresnan Communications. The committee required two additional items to the original agreement; requiring a three year warranty of reclaiming surface damage and to describe base material to be used in compacting their trench.

BUDGET FINANCE & AUDIT COMMITTEE
The committee addressed the retirement of capital credits.

Director Montoya asked if Director Zink would share with the Board his concerns and why he voted no on the resolution. Director Zink stated that he prefers more of the capital credits retirement be allocated to the FIFO method.

PAGOSA CITY COUNCIL AND ARCHULETA COUNTY OFFICIALS
Introductions were made of the city and county officials, the board of directors and staff. CEO Munro showed a Power Point presentation of the LPEA service territory, Mark Schwantes gave the 2005 long range plan, which covers 20 years, and Steve Gregg reviewed current projects in Archuleta County. Questions and comments were shared.

CEO REPORT, cont.
Prior to the financial report, CEO Munro advised the Board that he realized the Board was being given a full length financial report each month and they had requested only the full length report on a quarterly basis. After the quarterly report in July, only the one-line form 7 will be in the financials the following two months, and an abbreviated report will be given.
CFO Hammond gave the May 2007 financial report. The finances have been impacted negatively by a large industrial customer shutting down operations for maintenance.

ADMINISTRATION COMMITTEE
Director Compton advised that the committee addressed two items. An annual meeting update was given and discussion was held on possible changes to activities prior to the meeting. It was the consensus of the Board to keep presentations and exhibits at the annual meeting strictly about LPEA. Questions were raised concerning motions presented at an annual meeting. Attorney Spear was asked to review the legalities of possible motions presented by the members at an LPEA annual meeting.
The second item was approving the revisions to Board Policy 103, Delegations of Authority from the Board of Directors to the Chief Executive Officer.

PURPA HEARINGS
President Patton expressed her opinion that the hearings went well and thanked staff for their work on preparing for the hearings. She will get together with staff and Attorney Spear prior to the July Board meeting to draft the final decision to be adopted addressing the PURPA Standards.

EXTERNAL ORGANIZATIONS & ISSUES COMMITTEE REPORT
The Bayfield and Ignacio trustees have been invited to attend the July Committee of the Whole meeting.

LA PLATA ELECTRIC ROUND UP FOUNDATION
Director Alley gave the Round Up Foundation report. There are currently 14,489 members, down 61 from last month. The Foundation addressed 9 requests for a total of $34,000. 5 requests were denied, 2 were tabled and they awarded $2,000 a piece for 2 requests for a total of $4,000.

FASTTRACK REPORT
Director Alley reported FastTrack now has 5 employees. He thanked Dan Hammond for his 16 months as acting CEO and his financial guidance. A number of contracts have been completed and many more are pending. He reported no outages last month.

WESODI REPORT
Director McCaw gave the WESODI report, handing out current financials. There are 103 employees, down 4 from last month. They are negotiating rental of a property. He listed current projects of WESODI and BWR.

TRI-STATE REPORT
Director Goff reported on Tri-State. There is an upcoming planned maintenance outage for the Nucla Station in September, 2007. Director Goff plans to drive over for a visit while components are more accessible and he invited anyone interested to join him.
J.M Shafer, General Manager of Tri-State, announced his retirement effective July 2008.

CREA REPORT
Director Compton pointed out the CREA executive minutes and reported that the cooperatives are being encouraged to consider developing a net metering policy that minimally meets the needs of agricultures' interest in wind and solar energy.
Next week, CREA will be having a meeting to discuss how the organization handles voting on issues that come before them. Director Compton asked for input from this board on the best way for CREA to do this. Options include 1) if one cooperative votes no, then that is the same as every cooperative being against the issue, 2) a simple majority or 3) a super majority.

WESTERN UNITED REPORT
Director Formwalt reported that Western United is now rated 13th in the western United States. He updated the board on availability of materials. 65% of direct sales are to the members. At the end of April, sales were at $82M.

ATTORNEY REPORT
Attorney Spear commented on the condemnation case in his written report. He reviewed a PUC case discussed at the CREA Attorney's meeting.

EMPIRE ELECTRIC ANNUAL MEETING
Pam gave a brief report on the Empire Electric Annual meeting.

STRATEGIC PLANNING
There will be an update at the July board meeting.

FUTURE COMMITTEE OF THE WHOLE MEETINGS AND AGENDA ITEMS
The Committee of the Whole will meet Monday, July 16th with attendance by the Bayfield and Ignacio trustees. An annual meeting update, a Call Center presentation, an Emergency Response Plan presentation, the Strategic Planning Status report, and the adoption of the decision of the PURPA Standards will be on the agenda. Howard Barnes will be present at either the Committee of the Whole meeting or the Wednesday Board meeting to meet with the Board in regards to the next Construction Work Plan, equity levels and other related issues. The Laramie River Station tour is scheduled for August 9, 2007.

With no further business, the meeting adjourned at 3:00 P.M.

Recorded by Linda Wilsey
Original Signed by Tom Compton, Secretary
Original Signed and Approved by Pam Patton, President

R E S O L U T I O N 2007-04

WHEREAS, Williams Four Corners LLC has requested that La Plata Electric Association, Inc. enter into a Power Purchase Agreement; and

WHEREAS, La Plata Electric Association, Inc. wishes to enter into the contract to purchase the total output of the generator which utilizes heat recovery to generate power; and

WHEREAS, the La Plata Electric Association, Inc. Wholesale Electric Service Contract with Tri-State Generation and Transmission allows for member purchase of 5% of their average energy from outside sources; and

WHEREAS, in coordination with the Power Purchase Agreement, La Plata Electric Association, Inc. has proposed a Generation Contract with Tri-State Generation and Transmission, Inc., and Tri-State Generation and Transmission, Inc. has approved the Generation Contract,

NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of La Plata Electric Association, Inc. that the Board of Directors of La Plata Electric Association, Inc. authorizes the Chief Executive Officer, upon final legal review, to enter into a Purchase Power Agreement with the Williams Four Corners LLC effective through May 31, 2017.

I, Tom Compton, Secretary of La Plata Electric Association, Inc. do hereby certify that the above is a true and correct copy of a resolution adopted by the Board of Directors of La Plata Electric Association, Inc. at a regular meeting held in Pagosa Springs, Colorado on June 20th, 2007 at which meeting a quorum of directors was present and voting.

Original Signed by Tom Compton, Secretary

R E S O L U T I O N 2007-05

WHEREAS, Williams Four Corners LLC has requested that La Plata Electric Association, Inc. enter into a Power Purchase Agreement; and

WHEREAS, La Plata Electric Association, Inc. wishes to enter into the contract to purchase the total output of the generator which utilizes heat recovery to generate power; and

WHEREAS, La Plata Electric Association, Inc. Wholesale Electric Service Contract with Tri-State Generation and Transmission allows for member purchase of 5% of their average energy from outside sources; and

WHEREAS, in coordination with the Power Purchase Agreement, La Plata Electric Association, Inc. has proposed a Generation Contract with Tri-State Generation and Transmission Association, Inc.

NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of La Plata Electric Association, Inc. that the Board of Directors of La Plata Electric Association, Inc. authorizes the Chief Executive Officer to enter into a Generation Contract with the Tri-State Generation and Transmission, Inc. effective through May 31, 2017.

I, Tom Compton, Secretary of La Plata Electric Association, Inc. do hereby certify that the above is a true and correct copy of a resolution adopted by the Board of Directors of La Plata Electric Association, Inc. at a regular meeting held in Pagosa Springs, Colorado on June 20th, 2007 at which meeting a quorum of directors was present and voting.

Original Signed by Tom Compton, Secretary

RESOLUTION 2007-07

WHEREAS, the Board of Directors has decided to retire $2M of capital credits to members and former members, and

WHEREAS, the Board of Directors has determined the retirement of capital credits will not impair the financial position of the Cooperative and is not in conflict with existing mortgages, and

WHEREAS, the retirement will be distributed on a combination of FIFO and percentage basis: $872,000.00 FIFO for year 1987 and $1,128,000.00 approximately 1.3856% of the balance of all capital credits by each year 1988 through 2006.

NOW THEREFORE BE IT RESOLVED by the Board of Directors of La Plata Electric Association, Inc that the $2M capital credit retirement be approved.

I, Tom Compton, Secretary of La Plata Electric Association, Inc. do hereby certify that the above is true and correct copy of a resolution adopted by the Board of Directors of La Plata Electric Association Inc. at a regular meeting held in Pagosa Springs, Colorado on June 20, 2007 at which a quorum of directors was present and voting.

Original Signed by Tom Compton, Secretary

RESOLUTION 2007- 08
WHEREAS, LPEA owns the land underlying the Shenandoah Substation, located along County Road 125, West of Durango, Colorado, and
WHEREAS, Bresnan Communications has requested a grant of Easement for the installation of an underground communications cable, and
WHEREAS, the Easement and cable will cross an existing access road owned by LPEA, and
WHEREAS, the Easement and cable have been determined not to interfere with LPEA's operation and access to the Shenandoah Substation, and
WHEREAS, Bresnan Communications has made a written request that LPEA grant a written Easement across said access road, and
WHEREAS, the staff has recommended approval with the conditions described in the attached Easement Agreement,
NOW THEREFORE BE IT RESOLVED by the LPEA Board of Directors, that the aforementioned Easement with conditions is hereby approved, and Chief Executive Officer Greg W. Munro is hereby authorized and empowered to so execute said Easement Agreement.
I, Tom Compton, Secretary of La Plata Electric Association, Inc., do hereby certify that the above is a true and correct copy of a resolution adopted by the Board of Directors of La Plata Electric Association, Inc., at a regular meeting held in Pagosa Springs, Colorado, on June 20, 2007 at which meeting a quorum of directors was present and voting.

Original Signed by Tom Compton, Secretary

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