This meeting was publicly advertised in accordance with Section 84-1411 of the Nebraska Statutes by a notice on Radio Station KUVR on October 29, 2007, giving the time, date, and place of the meeting and the information that the Agenda was available in advance at the Office of the Assistant Secretary.

Individual cards giving the time, date, and place of this meeting were mailed to the Directors on October 19, 2007.

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

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; Eric R. Hixson, Engineering Services Mgr.; Frank C. Vetter, Real Estate Administrator; Greg F. Ham, Purchasing Agent; Michael C. Klein, Legal Counsel; Van D. Fastenau, Customer Service Super.; Robert J. McCormick, Legal Counsel; Mike A. Drain, Natural Resources Manager; Charles D. Brewster, Legal Counsel; Cory A. Steinke, Civil Engineer; Judy M. Hunt, Assistant Secretary

Others present:
Lori Potter, Kearney Hub; Richard Johnson, (Medo’s Board), Johnson Lake; John Thorburn, Tri-Basin NRD

* * * * * * * *

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 Special Meeting of the Board held September 21, 2007 were presented. It was moved by Director Petersen, seconded by Director Garrett, that the Board approve the minutes of the September 21, 2007 Special Board Meeting. Upon voting on the motion, the following Directors voted therefore: Bogle, Dahlgren, 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.

The minutes of the Regular Business Meeting of the Board held October 1, 2007 were presented. It was moved by Director W. Johnson, seconded by Director Mueller, that the Board approve the minutes of the October 1, 2007 Regular Business Meeting of the Board. 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.

The minutes of the Committee Meeting of the Board held October 26, 2007 were presented. It was moved by Director Soneson, seconded by Director S. Olson, that the Board approve the minutes of the October 26, 2007 Committee Meeting of the Board and approve the vouchers for payment. 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.

PUBLIC INPUT: Richard Johnson, Medo’s board member, stated that they were disappointed that Central decided to terminate the lease for Medo’s. John Thorburn reported that an eight month extension was granted for Tri-Basin’s Integrated Management Plan. He also reported that Central, Tri-Basin NRD and the Nebraska Game and Parks Commission are applying for funds from the Environmental Trust to compensate Central for delivering water to Elwood Reservoir when it is available.

RIGHT OF WAY TRANSACTIONS: The following right of way transaction was presented for approval:

It was moved by Director Petersen, seconded by Director R. Olson, that the Board approve the right of way transaction as presented. 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.

CHANGE ORDER NO.1 – DREDGE AMERICA: Change Order No. 1 to Contract 0-622 with Dredge America was presented for approval. The change order includes an increase in the sediment pumped from 2,000 to 2,188.5 cubic yards, increase in dive time, purchase of weir box and exception to bid for up to 3” diameter rock removed by bridge. This results in an increase of $86,665.61 making the total contract $376,545.61.

It was moved by Director R. Olson, seconded by Director Nelson, that the Board approve Change Order No. 1 to Contract 0-622 with Dredge America as presented. 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.

CLOSURE OF CONTRACT 0-622 – DREDGE AMERICA: A letter dated November 5, 2007 from the General Manager to the Board of Directors was read as follows:

Gentlemen:

On June 1, 2007, Contract No. 0-622 was awarded to Dredge America, Inc. for the Kingsley Outlet Tower debris removal in the amount of $289,880.00. One change order was issued for an additional $86,665.61, for a total contract amount of $376,545.61. Prior payments were made totaling $100,116.22 leaving a balance of $276,429.39.

All work has been completed, inspected and found to be satisfactory. We recommend payment in the amount of $276,429.39 be made to Dredge America, Inc. and Contract 0-622 be closed.

It was moved by Director Mueller, seconded by Director Lavene, that the Board authorize payment to Dredge America, Inc. in the amount of $276,429.39 and Contract 0-622 be closed. Upon voting on the motion, the following Directors voted therefore: Knoerzer, Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, and W. Johnson. None voted no and the motion was declared carried.

WATER TRANSFERS: The Irrigation Committee recommends approval for support for looking into and pursuing the transferability of acres that have been signed off.

It was moved by Director S. Olson, seconded by Director Dahlgren, that the Board direct staff to investigate opportunities to temporarily and/or permanently transfer water rights from acres for which irrigation service contracts have been cancelled, including transfers to other entities and/or uses. Upon voting on the motion, the following Directors voted therefore: Lavene, Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, and Knoerzer. None voted no and the motion was declared carried.

2008-2009 BUDGET – JOHNSON LAKE DEVELOPMENT, INC.: A proposed budget for 2008-2009 for Johnson Lake Development, Inc. was presented for approval. Total of the budget is $54,095.00. The 2008-2009 mowing expense of $6,500.00 is not included in the budget.

It was moved by Director Petersen, seconded by Director Bogle, that the Board approve the 2008-2009 budget for Johnson Lake Development, Inc. in the amount of $54,095.00 Upon voting on the motion, the following Directors voted therefore: Mueller, Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, and Lavene. None voted no and the motion was declared carried.

JEFFREY LAKE DEVELOPMENT, INC. V. CENTRAL – SEAWALL CASE: The District’s appeal remains pending in the Nebraska Court of Appeals. The Court of Appeals has not yet scheduled the appeal for oral argument.

JEFFREY & MIDWAY V. CENTRAL: The plaintiffs’ motion for summary judgment was argued October 22. The plaintiffs offered 396 exhibits in support of their motion. The District Court took the motion under advisement, subject to filing briefs within thirty days of the hearing.

CLEAR CREEK WILDLIFE MANAGEMENT AREA: A letter was received from the Nebraska Game and Parks Commission regarding the temporary enlargement of the Clear Creek Wildlife Management area at Lake McConaughy to accommodate recreational hunting. As water levels change, the boundary line will also change to maintain the fifty foot area subject to wildlife management area regulations.

2008 ANNUAL OPERATION PLAN: The 2008 Annual Operating Plan has been signed by both Nebraska Public Power District and The Central Nebraska Public Power and Irrigation District. Both boards now have thirty days in which to object to the Plan and if there is no objection, the plan will be considered approved by both Districts.

PLATTE RIVER RECOVERY AND IMPLEMENTATION PROGRAM: A conference call will be held this week regarding the Independent Scientific Advisory Committee. The Governance Committee will meet in December to work on the budget.

SOUTH PLATTE RIVER COMPACT COALITION – INTERLOCAL AGREEMENT: Staff recommends participation by Central in the South Platte River Compact Coalition Interlocal Agreement. Costs, if any, are not known at this time, but the Board will have the option of approving or disapproving any funds that would go toward the Interlocal Agreement.

It was moved by Director R. Olson, seconded by Director Garrett, that the Board approve participation in the South Platte River Compact Coalition Interlocal Agreement. Upon voting on the motion, the following Directors voted therefore: Nelson, R. Olson, S. Olson, Petersen, Rowe, Soneson, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, and Mueller. Directors Bogle and Dahlgren voted no. The motion was declared carried.

PERSONNEL: There were no personnel actions.

BOARD COMMENTS: The following Board comment was presented: 1) discussion was held on the electrical contract with Nebraska Public Power District.

DIRECTORS’ ATTENDANCE: It was moved by Director Lavene, 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: R. Olson, S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, and Nelson. None voted no and the motion was declared carried.

OPERATIONS REPORT: The following operations reports were presented:

a. Gary Bergsten reported that he has been working on reconciling actual 2006 figures to the budget.

b. Kevin Boyd reported on a call from FERC regarding the Surveillance Monitoring Plan. He also reported on the following: 1) the due date for the Part 12 inspection is November 15, 2007; bridge inspections will be done this month on the Supply Canal; and an update on the conditional exemption from the Acreage Limitation Provisions of Federal Reclamation Law.

c. Mike Drain updated the Committee on items in newspapers regarding the NARD brochure on COHYST and the models that have been developed by COHYST.

d. Jeff Buettner reported on an article in the Scottsbluff Star Herald regarding conclusions based on a study of hydrologic connections between ground water and surface water in the Platte River Basin between Scottsbluff and Columbus.

e. Dave Ford reported that a letter will be sent out on November 6th regarding customer meetings on November 16, 2007.

f. Tim Anderson reminded the Directors of the NWRA Round Table on December 14 where the speaker will be Governor Dave Heineman.

g. Cory Steinke reported that Lake McConaughy is at elevation 3209.8 or 29% of capacity.

h. Van Fastenau reported on one year transfers.

i. Eric Hixson reported that a meeting will be held with Nebraska Public Power District this week to go over the Kingsley budget.

At 10:19 AM, it was moved by Director R. Olson, seconded by Director Garrett, that the Board go into Closed Session to discuss Johnson Lake lease negotiations. Upon voting on the motion, the following Directors voted therefore: S. Olson, Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, and R. Olson. None voted no and the motion was declared carried. President Knoerzer stated that the purpose of the Closed Session was to discuss Johnson Lake lease negotiations.

CLOSED SESSION

At 11:13 AM, it was moved by Director Petersen, seconded by Director Nelson, that the Board return to Regular Session. Upon voting on the motion, the following Directors voted therefore: Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, and S. Olson. None voted no and the motion was declared carried. President Knoerzer stated that the issue discussed in Closed Session was Johnson Lake lease negotiations.

JOHNSON LAKE LEASES: It was moved by Director Rowe, seconded by Director Lavene, that the Board approve Resolution 07-7 as presented:

RESOLUTION 07-7

WHEREAS, The Central Nebraska Public Power and Irrigation District, hereinafter Central, a public corporation and political subdivision of the State of Nebraska, leases property it owns around Johnson Lake to individual cabin owners; and

WHEREAS, Central's Johnson Lake lease agreement sets forth an appraisal process to determine the rental amount to be paid by individual cabin owners at Johnson Lake for the next ten year period beginning March 1, 2008; and

WHEREAS, pursuant to paragraph 4.2.1 of Central's lease at Johnson Lake, Central hired Investment Property Exchange to complete an appraisal of all tiers of lots at Johnson Lake and submitted that appraisal to cabin owners on May 24, 2007, hereinafter referred to as Central's Appraisal; and

WHEREAS, pursuant to paragraph 4.2.2 of Central's lease at Johnson Lake, the Johnson Lake Response Group, a task force created by Johnson Lake Development, Inc., hired Great Plains Appraisal to complete an appraisal of First Tier Lots at Johnson Lake and submitted that appraisal to Central on October 19, 2007, hereinafter referred to as the Tenants' Appraisal; and

WHEREAS, Central has not received an appraisal by the Tenants of the Second Tier, Third Tier, Fourth Tier and Fifth Tier lots at Johnson Lake; and

WHEREAS, Central's Appraisal estimates the market value of an average First Tier lot at Johnson Lake to be approximately $61,400; and

WHEREAS, the Tenants' Appraisal estimates the market value of an average First Tier Lot at Johnson Lake to be approximately $45,000; and

WHEREAS, the agreement between Central and the tenants at Johnson Lake provides for averaging of the appraisals if there is not agreement on the appraised value of a First Tier Lot at Johnson Lake or, in the alternative, preparation of an additional appraisal by a third party; and

WHEREAS, there are certain aspects of the Tenants' Appraisal that Central thinks are incorrect; and

WHEREAS, the Johnson Lake Response Group has informed Central that it believes certain aspects of Central's Appraisal are incorrect; and

WHEREAS, Central recognizes that Sanitary Improvement District No. 1 of Gosper County (and Dawson County) (SID) has been formed to construct, operate and maintain sanitary disposal facilities for the Johnson Lake community at a significant effort and expense of Central's Johnson Lake tenants.

NOW, THEREFORE BE IT RESOLVED, by Central's Board of Directors that pursuant to paragraph 4.2.2 of the Lease Agreement between Central and the First Tier Tenants at Johnson Lake, Central hereby approves the appraised value of a First Tier lot included in the Tenants' Appraisal for purposes of computing the rental amount due under lease for the next ten year period.

BE IT FURTHER RESOLVED by Central's Board of Directors that the percentages set forth in Central's Appraisal for the other tiers be applied to the Tenants' Appraisal for purposes of computing the rental amount for Second Tier, Third Tier, Fourth Tier and Fifth Tier lots at Johnson Lake.

BE IT FINALLY RESOLVED, that the General Manager is hereby delegated the authority to fully implement this resolution.

Upon voting on the motion, the following Directors voted therefore: Petersen, Rowe, Soneson, Bogle, Dahlgren, Garrett, R. Johnson, W. Johnson, Knoerzer, Lavene, Mueller, Nelson, R. Olson, and S. Olson. None voted no and the motion was declared carried.

2008 BUDGET: The draft 2008 budget will be revised to reflect changes regarding Resolution 07 7 plus other additional changes.

The meeting adjourned at 11:17 AM.

ATTEST:
THE CENTRAL NEBRASKA PUBLIC POWER AND IRRIGATION DISTRICT

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