The following Directors were present:
William E. Knoerzer, President; Robert B. Dahlgren*; Martin E. Mueller; Robert L. Petersen, Vice President; Robert A. Garrett; Dudley L. Nelson; Roger D. Olson, Treasurer; Robert L. Johnson; K. Scott Olson; Doyle D. Lavene, Secretary; Wendell E. Johnson; David L. Rowe; Geoffrey K. Bogle; Gordon N. Soneson

*Arrived late

The following Director was absent:
Owen J. McDougal, Jr.

Also present were the following:
Don D. Kraus, General Manager; Gary L. Bergsten, Controller; Kevin M. Boyd, Gothenburg Division Mgr.; Tim W. Anderson, Public Relations Mgr.; David R. Ford, Irrigation Division Mgr.; Jeff J. Buettner, Info. & Comm. Officer; Marcia L. Trompke, Conservation Director; Frank C. Vetter, Real Estate Administrator; Cory A. Steinke, Civil Engineer; Michael C. Klein, Legal Counsel; Mike A. Drain, Natural Resources Manager; Charles D. Brewster Legal Counsel; Van D. Fastenau, Customer Services Supervisor; Robert J. McCormick, Legal Counsel; Eric R. Hixson, Engineering Services Mgr.; Judy M. Hunt, Assistant Secretary

Others present:
Lori Potter, Kearney Hub

* * * * * * * *

The President announced that information for the public concerning the Open Meetings Act is posted in the Board room.

At 9:00 AM, the Board President, William E. Knoerzer, announced that the meeting was open for business and proceeded with roll call.

The minutes of the Regular Business Meeting of the Board held May 7, 2007 were presented. It was moved by Director W. Johnson, seconded by Director S. Olson, that the Board approve the minutes of the May 7, 2007 Regular Business Meeting of the Board. Upon voting on the motion, the following Directors voted therefore: Bogle, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, and Soneson. None voted no and the motion was declared carried.

Director Dahlgren arrived at the meeting.

The minutes of the Committee Meeting of the Board held May 24, 2007 were presented. It was moved by Director Garrett, seconded by Director Nelson, that the Board approve the minutes of the May 24, 2007 Committee Meeting of the Board and approve the vouchers for payment. Upon voting on the motion, the following Directors voted therefore: Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, and Bogle. None voted no and the motion was declared carried.

PUBLIC INPUT: There was no public input.

NORTH PLATTE NRD DISCUSSIONS: Don Kraus noted that a committee of the Board and staff met with North Platte Natural Resources District on May 31, 2007 and the meeting was generally positive. Other matters were discussed in Closed Session

LEGAL ACTION – GROUNDWATER USE ABOVE LAKE MCCONAUGHY: Discussed in Closed Session.

At 9:02 AM, it was moved by Director R. Olson, seconded by Director Lavene, that the Board go into Closed Session to discuss North Platte NRD discussions and legal action regarding groundwater use above Lake McConaughy. Upon voting on the motion, the following Directors voted therefore: Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, and Dahlgren. None voted no and the motion was declared carried. President Knoerzer stated that the purpose of the Closed Session was to discuss the North Platte NRD discussions and legal action regarding groundwater use above Lake McConaughy.

CLOSED SESSION

At 10:48 AM, it was moved by Director Dahlgren, seconded by Director Garrett, that the Board return to Regular Session. Upon voting on the motion, the following Directors voted therefore: R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, and Garrett. None voted no and the motion was declared carried. President Knoerzer state that the issues discussed in Closed Session were North Platte NRD discussions and legal action regarding groundwater use above Lake McConaughy.

It was moved by Director Dahlgren, seconded by Director R. Olson, that the Board approve postponing the motion to initiate litigation against the Pumpkin Creek groundwater users until the July 2, 2007 Board meeting. Upon voting on the motion, the following Directors voted therefore: R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, and Garrett. None voted no and the motion was declared carried.

It was moved by Director Lavene, seconded by Director Mueller, that the Board authorize Central staff and legal counsel to initiate legal proceedings before the North Platte Natural Resources District and/or the Department of Natural Resources to protect stream flow into Lake McConaughy. Upon voting on the motion, the following Directors voted therefore: W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, and R. Johnson. None voted no and the motion was declared carried.

Director Bogle left the meeting.

BIDS – KINGSLEY OUTLET TOWER DEBRIS REMOVAL: Three bids for the debris removal at the Kingsley Outlet Tower were received on May 16, 2007 as follows:

Staff recommends accepting the bid from Dredge America

It was moved by Director R. Olson, seconded by Director Petersen, that the Board award the bid to Dredge American, Inc. for the rates being offered, $142,000.00 for mobilization, $64.50 per cubic yard for sediment removed, $120.00 per cubic yard for rock up to 3 inches and $472.00 per hour for tree branch removal. Upon voting on the motion, the following Directors voted therefore: Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, and W. Johnson. None voted no and the motion was declared carried.

WATER SERVICE AGREEMENTS AND CANCELLATIONS: The following 10-year terminations and combining of accounts were presented for approval:

It was moved by Director Petersen, seconded by Director Lavene, that the Board approve the Water Service Agreements as presented. Upon voting on the motion, the following Directors voted therefore: Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, and Knoerzer. None voted no and the motion was declared carried.

RIGHT OF WAY EXCHANGES: The following right of way exchanges were presented for approval:

It was moved by Director Soneson, seconded by Director Nelson, that the Board approve the right of way exchanges as presented. Upon voting on the motion, the following Directors voted therefore: Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, and Lavene. None voted no and the motion was declared carried.

2007 WATER RIGHT TRANSFER: There are 12 water right transfer requests equaling 235.8 acres for the 2007 irrigation season in the Phelps, E-67 and E-65 areas The water rights from cancelled acres will be used to cover requests for the parcels listed below. These have been advertised and no objections were filed.

Phelps Canal
Lee A. Englund – 7 acres – SE¼NW¼ 15-6-18
Richard D. & Jane M. Fecht – 7 acres – NE¼SW¼ 18-6-16
Ardyce D. Danielson – 58 acres – S½NW¼ 30-6-15
Kyle L. & Linda R. Edgren – 21 acres – SW½ 27-7-18
Eileen E. Fouts Trustee – 38 acres – E½SW¼ 28-8-19
Ericson Farms, Inc. – 7 acres – NE¼SE¼ 29-6-16

E-67
Knoerzer Farms, Inc. – 9 acres – S½SW¼ 21-8-22

E-65
Wayne M. & Linda C. Maaske – 39.8 acres – W½NW¼ 15-7-21
Joel & Darla Bergman – 7 acres – NW¼SE¼ 5-6-19
Karen Memory et al – 30 acres – S½SE¼ 5-6-20
Doyle Lavene et al – 11 acres – NW¼SE¼ 13-7-21
Doyle Lavene et al – 1 acre – NE¼SW¼ 13-7-21

It was moved by Director S. Olson, seconded by Director W. Johnson, that the Board approve the 2007 Water Right Transfer requests as presented. Upon voting on the motion, the following Directors voted therefore: Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, and Mueller. Directors Knoerzer and Lavene abstained. None voted no and the motion was declared carried.

CONSERVATION CORNERS PROGRAM: A revision was proposed for the Conservation Corner Program Agreement with Eileen E. Fouts which was approved by the Board at the January 10, 2007 meeting. The acres were reduced from 18.7 to 12.8 and the annual incentive price was reduced from $467.50 to $320.00.

It was moved by Director Garrett, seconded by Director Soneson, that the Board approve the revision to the Conservation Corner Program Agreement with Eileen E. Fouts. Upon voting on the motion, the following Directors voted therefore: R. Olson, S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, and Nelson. None voted no and the motion was declared carried.

KINGSLEY 2001-2003 AUDIT – MEMORANDUM OF UNDERSTANDING: A Memorandum of Understanding with NPPD for the Kingsley 2001-2003 audit was presented for approval.

It was moved by Director Garrett, seconded by Director W. Johnson, that the Board approve the Memorandum of Understanding for the Kingsley 2001-2003 audit subject to legal review. Upon voting on the motion, the following Directors voted therefore: S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, and R. Olson. None voted no and the motion was declared carried.

JEFFREY LAKE DEVELOPMENT, INC. V. CENTRAL – SEAWALL CASE: The District’s brief in response to the plaintiffs’ brief on cross appeal was filed in the Nebraska Court of Appeals on May 25, 2007.

JEFFREY & MIDWAY V. CENTRAL: The District’s staff continues to work with counsel in preparation of discovery responses.

HIXSON V. CENTRAL: The District’s appeal remains pending in the Nebraska Court of Appeals.

ROCKIES EXPRESS PIPELINE EASEMENT – RESOLUTION 07-03: The following resolution was presented for approval:

Resolution 07-03

BE IT RESOLVED, that The Central Nebraska Public Power and Irrigation District sell and convey to Rockies Express Pipeline LLC, a Delaware limited liability company, a pipeline easement over, under and across the real estate shown on Exhibits “A” – “E”, attached hereto and incorporated herein by this
reference, that the purchase price be $3,500.00 plus $1,000.00 for the District’s administrative fees, and that the President be and is hereby authorized and directed to execute and deliver said pipeline easement subject to legal review.

It was moved by Director Dahlgren, seconded by Director Soneson, that the Board approve Resolution 07-03 as presented. Upon voting on the motion, the following Directors voted therefore: S. Olson, Petersen, Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, and R. Olson. None voted no and the motion was declared carried.

OUT-OF-STATE TRAVEL: The following out-of-state travel was approved by the General Manager for May and June of 2007.

PERSONNEL: One personnel action was approved by the General Manager since the Committee meeting of the Board on May 24, 2007.

BOARD COMMENTS: The following Board comments were presented: 1) a questions was raised on the problem of water in the canals backing up on farmland; staff was not aware of a problem in this area and 2) a question was also raised regarding whether the new bridge at Johnson Lake will have room for walking as well as vehicle traffic. Staff indicated that walkers would be accommodated.

DIRECTORS’ ATTENDANCE: It was moved by Director Petersen, seconded by Director Nelson, that the Board excuse the absence of Director McDougal from the Board Meeting. Upon voting on the motion, the following Directors voted therefore: Rowe, Soneson, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, and Petersen. None voted no and the motion was declared carried.

OPERATIONS REPORT: The following operations reports were presented:

a. Gary Bergsten reported that he continues to work on the 2006 Reconciliation of the Kingsley Division.

b. Kevin Boyd reported on problems caused by the recent rain events in the Gothenburg area. He also reported that Homeland Security’s vulnerability assessment at Kingsley Dam recommendations should be received within thirty days and that Central should apply on the State level for funding for video cameras for security.

c. Mike Drain reported on the lake level amendment application at FERC and the filing for the waiver regarding lake levels for the 2007 irrigation season.

d. Jeff Buettner gave a power point presentation on the fire at the Visitors Center at Kingsley Dam.

e. Dave Ford reported that Central continues to fill the canals and that the irrigation schedule begins in three weeks.

f. Frank Vetter updated the Board on the status of lease fees at Johnson Lake. He also reported that the appraisal was mailed to all tenants at Johnson Lake.

g. Van Fastenau reported that 80 requests have been received for a permit to pump water into the canals district-wide. He also reported on possible candidates for bridge waivers.

g. Eric Hixson reported that there has been quite a bit of generation on the Supply Canal and Central is 21,000 megawatts ahead of last year.

h. Cory Steinke updated the Board on elevations at Lake McConaughy and also reported that water is being diverted into Elwood Reservoir.

i. Marcia Trompke gave a presentation on comparisons of rainfall amounts over the last thirty years.

j. Don Kraus reported that he, Jeff Buettner and several Directors will be going on the water tour next week in New Mexico.

The meeting adjourned at 11:34 AM.

ATTEST:  THE CENTRAL NEBRASKA PUBLIC POWER AND IRRIGATION DISTRICT

Doyle D. Lavene, Secretary
By William E. Knoerzer, President