March 2008

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, March 19, 2008, in the headquarters building in Durango, Colorado. Director Goff led the Board in the Pledge of Allegiance.
President Patton called the meeting to order at 10:00 A.M. The following directors were 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 Looman, HR Director
Linda Wilsey, Executive Secretary

GUESTS (from sign in sheet)
No guests attended the meeting.

AGENDA
The agenda was addressed.

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 3/17/08

Administration Committee 3/17/08
Tom Compton     Terry Alley      Jeffrey Berman     Herbert Brodsky     Robert Formwalt

Systems' Operations & Planning Committee 3/17/08
Harry Goff      Harry Cole      Davin Montoya       Pam Patton

Budget Finance & Audit Committee 3/17/08
John Gardella    Terry Alley     Harry Goff    Herbert Brodsky

External Organizations & Issues Committee 3/17/08
Ed Zink    Robert Formwalt     Tom Compton     Harry Goff    Pam Patton

Board Meeting 3/19/08

Meetings

APPOINT A DELEGATE/ALTERNATE FOR THE TRI-STATE ANNUAL MEETING
Directors Brodsky and Montoya were noted as planning to attend the Annual Meeting. Additionally, Directors McCaw and Berman may be attending the meeting.

RESOLUTION 2008-02: PURCHASE OF SHARES IN FASTTRACK COMMUNICATIONS, INC.
CEO Munro briefly reviewed the stock purchase agreement between D.E. Miller, Ltd and LPEA.
He recommended the Board adopt Resolution 2008-02, approving the purchase. The question was raised concerning if the other shareholder, Empire Electric, needs to give their consent for the purchase. Attorney Spear stated this is not necessary. CEO Munro stated that Empire Electric's CEO Neal Stephens verbally gave his consent but chose not to give it in writing. Discussion ensued.

CEO REPORT
CEO Munro highlighted Tri-State's activities since his written report. Tri-State staff presented an idea of a renewable energy program to the Tri-State Member Managers and CEO Munro stated all the managers in attendance but one approved the program. The Tri-State Board will consider action on the program in April. He noted their Budget Load Forecast vs. Actual graph for 2007. He updated the Board on the San Juan Major Project. LPEA is implementing a high school internship program to teach high school students about our industry.
It was determined that CFC can do a cost of service study for LPEA at no charge. There is a waiting list for the service, so CEO Munro asked if the Board would like him to request this service, expecting a year's delay in having the CFC cost of service completed. The board agreed to have CFC perform this service for LPEA.
Holy Cross is having a Cost of Service Study done to determine if inclining block rates would be appropriate.
The updated unclaimed capital credits work sheet was addressed. Discussion was held on possibilities for using the funds that are not already allocated. President Patton asked that this item be added as an agenda item for the Committee of the Whole in April.
CFO Hammond gave a brief financial report. He mentioned two events that have had an impact on the financial forecast; large expenses occurred from the major outages and $2M from unbilled revenue was received as revenue accrual. The $7M loan funds were received; $5M of the funds has been invested.

COMMITTEE OF THE WHOLE MEETING
The Committee of the Whole met and received the 2007 staff annual report with the exception of the CEO Report and Human Resources Department. These were given during the Board meeting.

BUDGET FINANCE & AUDIT COMMITTEE
Director Gardella reported that the committee received the 2007 audit report from Schmidt & Co. As an independent audit firm, it was learned that the firm can supply up to 40 hours of consulting per year to the LPEA Board.

The committee addressed Resolution 2008-03, authorizing CEO Munro to execute the contract with Schmidt & Co. to perform future annual audits.

SYSTEMS' OPERATION & PLANNING COMMITTEE
Director Montoya reported the committee was given information on bidding of the Sunnyside Substation transformer.

ADMINISTRATION COMMITTEE
Director Berman stated the committee reviewed Board Policies 107 and 109. Policy 107 was tabled by the committee. Minor changes were made to Policy 109.

STAFF ANNUAL REPORT
Linda Looman, Human Resource Director, gave her report. LPEA currently has 114 employees. Workforce planning is now taking precedence over other areas as 55% of the Operations group will be retiring in the next 10 years. She gave highlights from 2007 which included the Employee Annual Meeting, networking with Colorado Coops, and planning for the future.
CEO Munro gave his report. He covered the 2007 goals and accomplishments and expanded on the Key Ratios Trend Analyses graphs.

EXTERNAL ORGANIZATIONS & ISSUES COMMITTEE
Director Zink reported that the committee addressed strategic planning session for 2008. They decided their first priority is working with the Southern Ute Indian Tribe on right of way issues. They recommended the Executive Committee plus Directors Formwalt and Zink meet with the tribe. The second priority is to meet with La Plata County and the city of Durango since they both have new managers.

LA PLATA ELECTRIC ROUND UP FOUNDATION
The Round Up Foundation met on Monday, February 25th and on March 17th. At the February meeting, there were 7 requests totaling $17,895. One request was tabled, one denied and 5 were granted for a total of $13,650. That month showed a decline of 62 members rounding up. At the March meeting, there were 6 requests for a total of $24,598. Again, one request was tabled, one was denied and 4 were granted for a total of $7,598. March showed a decline of 73 members. It was noted that the decline seems to be from disconnects and not people cancelling their rounding up. Director Brodsky indicated that Colorado Country Life magazine has an article about the Round Up Foundation.

FASTTRACK REPORT
Director Gardella reported that there were no outages this past month. The 2007 audit was received and FastTrack received a clean audit. Financial reports were given and the annual review of the General Manager is in process. A new line of credit for $150,000 has been established. FastTrack is hoping to pay off the debt to LPEA within a year's time. Director Brodsky handed out an update from FastTrack of the Montoya Education Connection program.

WESODI REPORT
Since the Annual Meeting was held prior to the LPEA Board Meeting, the board was updated on WESODI's activities. Director McCaw had no further comments.

TRI-STATE REPORT
Director Goff highlighted certain information from his written report. Ken Anderson has been selected as the next Executive VP and General Manager of Tri-State. He will succeed J.M. Shafer.
CEO Munro updated the Board on information gained at the Tri-State's Manager's meeting he attended the previous day.

CREA REPORT
Director Compton indicated the CREA Board has not met since the Annual meeting. He gave an update of the status of current state legislation activities.

WESTERN UNITED REPORT
Director Formwalt reported on the process of the Board choosing the new CEO from four final candidates. Mike Prom, from Texas Electric Supply Cooperative, was hired to succeed Ron Schott on July 1st.

4CORE REPORT
Director Zink attended two 4CORE meetings. He indicated that the temporary board consists of five people who are to set up the Articles of Incorporation, the Bylaws, the 501(c)3 status and move the program forward. This is going moderately well though there seems to be a conflict regarding the meaning of success of the organization.

ATTORNEY REPORT
Attorney Spear updated the Board on the one condemnation case. The legal description used in the case proved to be inaccurate so it will take more time to resolve the issue. The CREA Attorneys meeting is next month; Attorney Spear was asked to be the new chair this fall.

FUTURE COMMITTEE OF THE WHOLE MEETINGS AND AGENDA ITEMS
There will be a Committee of the Whole meeting on Monday, April 14th. Agenda items include a discussion on the best way to use capital credit funds for the community, looking at the LPEA scholarship guidelines, and an update on the strategic planning status. The Administration Committee will meet to review the LPEA Bylaws and some Board Policies. Reports that will be due are quarterly write offs, director reimbursements reports, the Renewable Generation Contributions report, and the financial report.
The CEO evaluation forms will be sent electronically to be filled out and returned to President Patton.

UPCOMING EXTERNAL MEETINGS
Director Compton plans to attend the NRECA Legislative Conference; he indicated that CREA will be making all of his arrangements. President Patton encouraged directors needing credentialed classes to attend Summer School West in Colorado Springs in July.

With no further business, the meeting adjourned at 3:28 P.M.

Recorded by Linda Wilsey
Original Signed by Jeffrey A. Berman, Secretary
Original Signed and Approved by Pam Patton, President

R E S O L U T I O N 2008-02

WHEREAS, La Plata Electric Association, Inc (LPEA) owns 712.5 shares of FastTrack Communications, Inc, and
WHEREAS, D. E. Miller Ltd. owns 50 shares of FastTrack Communications, Inc., and
WHEREAS, Donald E. Miller is the sole shareholder in D. E. Miller Ltd., and

WHEREAS, D. E. Miller Ltd, and Donald E. Miller, as its sole shareholder, wish to sell their entire interest in 50 shares of FastTrack Communications, Inc. to LPEA, and
WHEREAS, LPEA staff has negotiated a Stock Purchase Agreement with D. E. Miller Ltd. and Donald E. Miller, and
WHEREAS, LPEA staff recommends the LPEA Board of Directors approve the purchase of the 50 shares of FastTrack Communications, Inc., stock pursuant to the Stock Purchase Agreement with D. E. Miller Ltd. and Donald E. Miller

NOW, THEREFORE BE IT RESOLVED by the Board of Directors of La Plata Electric Association, Inc. that it is in the best interest of LPEA to purchase the 50 shares of stock of FastTrack Communications from D. E. Miller Ltd, and that the Chief Executive Officer of LPEA be, and hereby is, authorized to execute, subject to legal review, the Stock Purchase Agreement with D. E. Miller Ltd. and Donald E. Miller.

I, Jeffrey A. Berman, 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 Durango, Colorado on March 19th, 2008 at which meeting a quorum of Directors was present and voting.

Original Signed by Jeffrey A. Berman, Secretary

R E S O L U T I O N 2008-03

WHEREAS, the Board of Directors of La Plata Electric Association Inc. (LPEA) contracts Schmidt & Company LLC to perform LPEA's annual Certified Public Accountant Audit, and
WHEREAS, the Board of Directors of La Plata Electric Association Inc. will receive an audit that applies Auditing Standards Generally Accepted in the United States and Generally Accepted Government Auditing Standards, and
Whereas, the Board of Directors of La Plata Electric Association Inc. will receive a Management Report, an Audit Committee report, a Compliance report, a Laws/Regulations report, an Internal Controls report, copies of the Audit Report with an Independent Auditor's Report, an audit presentation to the Board of Directors at LPEA's office location, and communication with the Audit Committee including report.
NOW THEREFORE BE IT RESOLVED by the Board of Directors of La Plata Electric Association Inc. that the Chief Executive Officer of LPEA is authorized to execute the contract with Schmidt & Company LLC, to perform LPEA's annual financial audits, for calendar years 2008, 2009 and 2010.

I, Jeffrey A. Berman, 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 Durango, Colorado, on March 19th, 2008, at which meeting a quorum of directors was present and voting.

Original Signed by Jeffrey A. Berman, Secretary

R E S O L U T I O N 2008-04

WHEREAS, the Association has a need to purchase a 115/12.47 kV transformer for the Sunnyside Substation; and,
WHEREAS, 6 responsive bids were received from suppliers for supply of the specified equipment; and,
WHEREAS, Western United Electric Supply Corporation for a transformer manufactured by Virginia Transformer Corporation was the best valued bidder incorporating cost and efficiency in that value assessment,

NOW THEREFORE, BE IT RESOLVED by the Board of Directors of La Plata Electric Association, Inc. that the bid of $375,400, which includes a 5 year warranty, from Western United Electric Supply Corporation for a transformer manufactured by Virginia Transformer Corporation for the Sunnyside Substation Transformer be accepted and that the Chief Executive Officer of LPEA be, and hereby is, authorized to execute, subject to legal review, the purchase agreement.

I, Jeffrey A. Berman, 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 Durango, Colorado on March 19th, 2008 at which meeting a quorum of Directors was present and voting.

Original Signed by Jeffrey A. Berman, Secretary

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