CR 98-70 Approve NSP Excelsior Blvd Street Lighting ContractY
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April 30, 1998 Council Report 98 -070
Approve NSP Excelsior Boulevard Street Lighting Contract
Proposed Action.
Staff recommends ado of the following motion: Move that Council
authorize the Mayor and City Manager to enter into a contract with Northern
States Power (NSP) for installation of 64 streetlights on Excelsior Boulevard
from Shady Oak Road to 9 Avenue.
Overview.
In July, 1997 City Council approved the Excelsior Boulevard lighting design
including base, pole and fixture style and color. The approved light style is
as shown on the attached drawing. The approved color was a very deep
raspberry or burgundy color. Staff stated at the July Council meeting that
NSP would prepare a proposal to include installation and maintenance of the
64 streetlights. Staff received an NSP proposal of $205,722.00 and is now
submitting it for Council consideration.
Primary Issues to Consider.
• Street lighting budget - NSP proposed fee
• Bidding requirements for public improvements
• Contract specifics
• Schedule for installation
Supporting Information.
Analysis of Issues
Streetlight design drawing
City Attorney opinion regarding competitive bidding
• NSP Letter and Contract
Hallberg Engineerin opinion of probable cost
N mber 21, • ' SP letter describing project scope
J
Steven J. Stadler, Public Works Director
Council Report 98 -070
Page 2
Analysis of Issues.
Street Lighting budget — NSP proposed fee
The original Excelsior Boulevard reconstruction, Phase I street light budget
was $328,000. The total annual maintenance and energy costs for these
additional street lights is approximately $5,000.00
Hallberg Engineering provided a review of this project scope and an opinion
of probable cost. NSP's requested construction fee of $205,722.00 is close
to the $172,000 - $190,000 contractor cost range estimated by Hallberg
Engineering. NSP's maintenance and energy fees are the Minnesota Public
Utility Commissions approved amount for NSP - installed 150 watt HPS
street lights.
• Bidding requirements for public improvements
The City Attorney has reviewed this project to determine whether the city
must seek competitive bids. He states that based on the case law the
competitive bidding statute does not apply to this project — see attached City
Attorney memo.
• Contract Specifics
The contract will require NSP to purchase all materials and install the
specified street lights and maintain them for a period of 25 years.
Maintenance includes repair or replacement of all street light components
including knockdowns or damaged poles, replacement of burned out lamps,
repairing wiring, etc.
Council Report 98 -070
Page 3
• Schedule for installation
NSP anticipates installing the new street lights prior to the boulevard
restoration work associated with the Excelsior Blvd street reconstruction.
This means the lights will be installed this fall and/or next spring.
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Date: April 2, 1998
To: Steven Stadler
From: Jerre Miller
Re: NSP Contract
city offfopkirts
1010 First Street South • 5fopkins, 9KN55343 -7573 • Phone: 612 -935 -8474 • Fax 612 -935 -1834
MEMO
I have reviewed the packet concerning the NSP Contract for installation of light standards and
service of them thereafter.
The memorandum attached from the Eden Prairie City Attorney on a similar project was interesting
and I agree with the conclusion if the circumstances of the Eden Prairie project and the proposed
Excelsior Boulevard project are closely similar to each other.
Hubbard Broadcasting, Inc. cited as Hubbard Broadcasting. Inc. v. Metropolitan Sports Facilities
Commission, 381 N.W.2d 842 contains favorable commentary for cities when complex issues arise
about whether a contract should be submitted to competitive bidding or not.
The Hubbard case cited an authority that provisions in a statute about competitive bidding should
be narrowly construed rather than broadly construed thus allowing cities to address this kind of an
issue sensibly and in a practical way.
Splitting the approach to the lighting project competitively bidding on light standards and then
dealing exclusive for maintenance and : ical service with NSP is neither practical nor sensible.
c: \file \hopkins \ss -memo 1
An Equal Opportunity Employer
ROBERT r. LANG
ROGER A. PAULY
DAVID H. GREGERSON
RICIL F. ROSOW
MARK J. JOHNSON
JOSEPH A, MAN
JOtL*r W. LANG- -
SUSAN M. LACH••-
1L Defy H. DU CHER
WILLIAM R. h1ILLER
TODD A. BATTLER
JENNIFER X. INz
- Atm Amoral Vt Wiscon »a
- also a Centaca Public Accountant
""Also Admitted so Cobr Ito
Mr. Eugene Dietz
Eden Prairie City Offices
8080 Mitchell Road
Eden Prairie, MN 55344 -2230
RE: Eden Prairie Marketeenter Lighting
Dear Mr. Dietz:
1 t .
• is
LANG, PAULY & GREGERSON, LTD.
ATTORNEYS AT LAW
FIRST BANK PLACE
1600 IBM PARK BUILDING
650 THIRD AVENUE SOUTH
MINNEAPOLIS. MINNESOTA 55402 -4337
TELEPHONE: (612) 338 -0755
FAX (612) 349 -6718
May 24, 1994
You have asked whether. the City must seek competitive bids for a proposed street light
project in the Marketcenter area. I . understand that the particular fixtures to be used are
decorative in nature and not the ordinary street light pole. NSP has made a proposal whereby
NSP would supply electric service, own, operate, repair and maintain the light poles, fixtures and
underground wiring and charge the City a per fixture fee each month. The City would be
required to pay the capital and installation costs up front. By doing this, the City reduces ,the
monthly charges from the normal leased ratc and allows NSP to install, 'own and maintain the
entire system for 25 years.
Contract amounts estimated to exceed $25,000.00 must be solicited by competitive
bidding under Minnesota Statute 471:345. The statute applies to the sale or purchase of supplies,
materials, equipment or the rental thereof, or the construction, alteration, repair or maintenance
of real or personal property. The Minnesota Supreme Court held that the bidding statutes are to
be narrowly applied. Hubbard Broadcasting, Inc. v. Metropolitan Sports Facilities Commission,
381 N.W.2d 842 (Minn, 1986). The following paragraph from the Court's Opinion is instructive:
"We have recognized that public bidding provisions are to be
construed narrowly. In R.E. Short Co. v. Minneapolis, 269 N.W.2d
331, 342 n. 11 (Minn. 1978), we noted that the public bidding
statute is restrictive and should not be extended to contracts not
envisioned by the legislature. In Griswold v. Ramsey County, 65
EDEN PRAIRIE OFFICE
sUrrE )70
:so PRAtIttE CENTER DANE
EDEN PRALRIE. MINNESOTA 55:1.4.4
TELEPHONE: (51_1 a29.733s
FAX 1612) 829.071)
REPLY TO E,A?O . S OFFICE
LANG, PAULY & GREGERSON, LTD.
Mr. Eugene Dietz
May 24, 1994
Page 2
N.W.2d 647, 651 (Minn. 1954), we stated: `In the absence of a
controlling constitutional, statutory, or charter provision, it is
generally held that public policy does not demand that a municipal
corporation ... advertise for bids and let the contract to the lowest
responsible bidder.' • . . One authoritative text notes: `These
[competitive bidding] provisions are strictly construed by the
courts, and will not be extended beyond their reasonable purport.
Such provisions must be read in the light of the reason for their
enactment, lest they be applied where they were not intended to
operate and thus deny municipalities authority to deal with
problems in a sensible, practical way.' 10 E. McQuillin, Municipal
Corporations (3rd ed.) §29.29 (citations omitted). This principle of
narrow construction requires that the contract being challenged
must unambiguously fall within the language of the public bidding
statute ... "
The contract considered by the Hubbard Broadcasting case is instructive. In that case,
the Metropolitan Sports Facilities Commission entered into a contract with American Sign to
purchase a scoreboard for the Metrodorne. As all or part of the consideration the Commission
paid for the purchase of the sign from American Sign, the Commission granted American Sign
the exclusive right to sell and contract for advertising on the scoreboard. The agreement also
provided for a splitting of revenue from the advertising. The Court held that the contract was
not a contract that fell within the purview of the statute as "many of the features of the agreement
are simply beyond any fair meaning of `contracts for materials, supplies and equipment' within
the statute." 381 N.W.2d at 846. The Court held that the scoreboard system agreement was not
a contract for supplies, materials or equipment and that the commission did not violate the public
bidding statute by entering into the agreement.
The competitive bidding statute has not been interpreted to apply to contracts for services
other than services for maintenance of property. A contract for snow removal from town roads
is not subject to competitive bidding for example. Op. Atty. Gen. 707(a), March 5, 1986.
Further a City does not have to advertise for bids for a contract for the collection and hauling
of refuse. Op. Atty. Gen. 707(a) - 15 (December 23, 1977).
Based on the Hubbard Broadcasting case, 1 believe it is reasonable to conclude that the
competitive bidding statute does not apply to this case. As with the situation in Hubbard
Broadcasting, we also have in this situation an element of the proposed contract that is beyond
a contract for materials. supplies and equipment, i.e., the purchase of electricity. The purchase
of electricity by the City is not subject the competitive bidding statute. The argument could be
made that NSP would supply the electric service even though the poles, fixtures and wiring were
not purchased and/or leased as part of the transaction. However, the same statement could be
made with respect to the purchase of the scoreboard in Hubbard Broadcastine. The Commission
could have purchased a scoreboard separate from selling the advertising rights and certainly the
�T ;y G, PAULY & GREGERSON, LTD.
Mr. Eugene Dietz
May 24, 1994
Page 3
purchase of that piece of equipment, isolated from the advertising feature, would have required
competitive bidding. Since the Court did not require such unbundling of contract features in the
Hubbard Broadcasting case, 1 believe it is reasonable to assume that such would not be required
is this situation as well.
Based on the above, 1 believe the Council could legally enter into a contract with NSP
without fulfilling the requirements of competitive bidding.
If you have any questions regarding this matter, please contact me.
Very truly yours,
LANG, PAULY & GREGERSON, LTD.
RFR/snnt
cc: Roger Pauly
rft‘ep\marketst\urambrue. ttr
MP
2 March, 1998
Steve Stadler
Director of Public Works
City of Hopkins
1010 First Street South
Hopkins, MN 55343
Dear Steve,
Ay
1518 Chestnut Avenue North
Minneapolis, MN 55403
Telephone (612) 630 -4282
Thank you for the opportunity to work with you on the upgrade of the Excelsior
Boulevard Street Lighting. In response to the January 1998 letter from Hallberg
Engineering, NSP has revisited and re- evaluated our proposal. In viewing the costs
for several aspects of this project from a "Total Project" perspective we have
determined that we can justify a reduction based on enhancements to the ability to
maintain the overall system. This will allow NSP to reduce the price of the proposed
system to $205,722.00. The maintenance costs, $35,900.00 versus $70,000.00, are
where the major differences can now be found.
Per that letter, the premium option for the "Contractor Costs" during the 25 year
period of $35,900.00, and with no mention of repairs or replacement of poles, wires
or luminaires, are based on;
• Replacement of 1 ballast per fixture
• Replacement of 2 burned -out lamps per fixture (Spot Relamping)
Northern States Power Company
NSP's Full Service Maintenance, standard for this type of installation, provides for
the repairs and replacement of luminaires, and wiring, along with the following
coverage for the full 25 year period;
• Group relamp all lamps on schedule (based on fixture type and roadway
conditions, ranging 3 to 5 times over the 25 year period)
• Repair /Replacement of knocked down or damaged poles
• Replacement of any burned -out lamps within an agreed upon time period after
reporting
• Replacement of all broken or damaged glassware and /or gaskets
• Replacement of all failed ballasts
Replacement of all failed starters
Replacement of all failed photo - electric controls
• Replacement of all failed fuses
Our maintenance efforts are more than double the proposed efforts of the
"Contractor" and the proposed coverage is for the full extent of the system, not just
the visible working portions.
The NSP Rate Schedule for this type of system, Decorative Underground - Group V,
provides a flat monthly rate of $6.45. $3.65 is maintenance and $2.75 represents a
flat energy cost. Therefore, $3.65 x 64 x 12 x 25 = $70,000.00 over a 25 year
period not "Up- front ".
Regard
Jim Rhodes
Community Service Manager
Receipt of the above amount hereby acknowledged on behalf of NSP by
1. The customer hereby grants NSP the right, privilege and easement to install, operate and maintain its underground facilities
on the property as described above and /or the approximate location as shown on the attached "Exhibit A ".
2. The customer also agrees that, prior to NSP starting work: (a) the route of NSP's underground installation shall be
accessible to NSP's equipment; (b) all obstructions shall be removed from such route at no cost or expense to NSP; (c)
ground elevation along the route shall not be above or more than four (4) inches below the finished grade; and (d) the area
under the transformer pad shall be compacted to at least 2000 lbs. /sq. ft.
3, CITY OF HOPKINS agrees to pay all additional installation costs incurred
by NSP because of (a) soil conditions that impair the installation of underground facilities, such as rock formations,
etc., and (b) sidewalks, curbing, black top, paving, sod or other landscaping and obstructions along the cable route.
NSP will backfill trench with existing soil. Restoration of construction area on customer property is the responsibility of
the customer.
4. NSP is not responsible for any customer -owned underground facilities not exposed at the time service is installed.
5. The underground installation may be subject to a winter construction charge if it is installed between October 1 and
April 15. N/A
to if NSP determines winter conditions exist when the underground facilities are installed. NSP e will a h w rater
construction charge if prior to October 1st the customer is ready to accept electrical service, has executed this form and
has notified NSP in writing that the requirements of Paragraph 2 hereof have been fulfilled.
6. The underground facilities installed by NSP, shall be the property of NSP and any
payments made by the customer, or their
contractor, shall not entitle the customer to any ownership interest or rights therein.
7. The customer agrees to pay the cost of relocating any portion of said underground facilities made to accommodate the
customer's needs or required because of altering the grade, additions to structures, installing patios, decks or gardens or
any other condition which makes maintenance of the company's facilities impractical.
8. Customer must provide the following minimum clearance around the transformer: front, 10 feet; sides and back, 2 feet.
EXCEPTION: side facing building must have 30" clearance. These clearances must be at the same grade as the
transformers. If screening is to be used, the area in front of the transformer must be left open or a hinged door, easily
operable by one person, must be provided. The area must be accessible 24 hours a day.
$
$
$
$
$
UNDERGROUND SERVICE FORM
Form 17- 2759(2 -94)
In consideration of NORTHERN STATES POWER COMPANY, hereinafter called "NSP ", extending its facilities
to make 120 volt, 1 phase, 2 wire underground service available
(customer) CITY OF HOPKINS
at (service address) 0 Excelsior Boulevard (city) Hopkins
the sum of Two Hundred - Five Thousand, Seven Hundred Twenty - Two Dollars ($ 205,722.00 )
will be paid to NSP by (other than above) Same
Address (other than above) 1010 Second Street South City Hopkins Zip 55343
in accordance with the following terms: In Advance - Returned with signed contracts
Credit Approval
Excess U.G. Distribution Lateral
(Primary Cable)
Excess U.G. Service Lateral
U.G. Service Lateral
(Secondary Service From Utility Pole)
U.R.D. Installation Including
U.G. Service Lateral
U.G. Distribution Lateral (Primary Cable)
$
$
$
$
$205,722
Winter Const. Charge 1
(See paragraph 5)
Specific Service Location or Route
Replace Overhead Line With
Underground Line
Temporary Service KVA
Other (explain) Install 64 - Group 5
Fixtures on Excelsior Boulevard
* *Customer agrees to pay monthly Residential Service Underground
Trench Ft.
rate of the
double asterisk. ❑ Applicable ® Not Applicable type of installation indicated by a
Dated this day of 19 98 Dated this
Customer CITY OF HOPKINS Contractor
Iliv City Manager
Mayor / By File # 737659
y
NSP Rep James H. Rhodes 3/31/98 Div Edina NSP Proj /Serv. No. SHAD HPK AAM
Const.$ 205; 722, ah $ Maint. $ Oper. $ Transf. $ = Total $ 205,722.00
Copy — Division Accounting (Original) • Copy — Division Distribution Engineering • Copy — Customer
day of 19
Northern States Power
c/o RPLS Coordinator
5309 W. 70th St.
Edina, MN 55439
EXHIBIT B
The City of Hopkins has elected to receive street Tight service for unique non-
standard Designer Series NSP facilitates. The City shall purchase, own and
provide, upon request by the Company, the replacement non - standard
components to keep the unique non - standard facilities operable. The non-
standard components to be purchased and warehoused by the City are:
1.) The King High Performance Acorn Luminaire - 150 watt HPS, Type II fixture
2.) The LUMEC Pole, smooth tapered extruded aluminum shaft, (LMS -14' 6"
RAL3007- 11695A)
The components shall be made available to the Company at the City's Public
Works facility at 3100 Hopkins Crossroads, Hopkins Minnesota 55343.
Once NSP has picked up and installed the above listed replacement part, the
City shall submit a bill to NSP to recover its original purchase cost.
Accompanying the bill shall be a copy of the original sales invoice from the part
supplier. This bill shall be payable within 30 days and is to be sent to:
If, in order to comply with the normal operation of he unique Designer Series
street lights, it is necessary to install temporary facilities due to City's inability to
provide the non - standard components, when requested by the Company, the
City shall be responsible for all costs incurred for such temporary facilities. The
City will reimburse the Company for such costs within 30 days after receipt of a
bill from the Company.
Form 17 -2796
AVAILABILITY: Available for year -round illumination of public streets by electric lamps in
luminaires mounted on standards and served through underground circuits, where the facilities for this
service are furnished by Company. Street lighting service under this schedule is limited to areas
having a Company -owned underground electric distribution system.
RATE: Group V Purchased Equipment
Rate Schedule C
(Minnesota)
To Street Lighting Contract DatedF e b ru a r y 15, 19 7 9
STREET LIGHTING
(Company Owned)
Designation of Lamps
Monthly
Rate per
Standard
150 Watt High Pressure Sodium $6.45
Refer to Rate and Rules for application of Street Lighting Rates which are attached for specific
information.
Note here if customer wishes NSP to retain ownership NS P w i 11 retain ownership
SERVICE INCLUDED IN RATE: Company shall operate and maintain the Custom Street Lighting
system using Company's standard street lighting equipment.
DAILY OPERATING SCHEDULE: The daily operating schedule of the above lamps shall be from
approximately one -half hour after sunset until one -half hour before sunrise.
OUTAGES: If illumination from any lamp is interrupted and said illumination is not resumed within
24 hours from the time Company received notice thereof from customer, 1/30 of the monthly rate for
such lamp shall be deducted for each night of nonillumination after such notice is received.
The above rate schedule has been filed with the Minnesota Public Utilities Commission effective
February 3 , 19 98
Date March 31, 1998
Supersedes Rate Schedule C Dated De c emb e r 31, 19 9 2
W I Northern States Power Company
Minneapolis, Minnesota 55401
MINNESOTA ELECTRIC RATE BOOK - MPUC NO. 2
STREET LIGHTING SYSTEM SERVICE
RATE CODE A30
AVAILABILITY
Available for year -round illumination of public streets, parkways, and highways by High Pressure Sodium (HPS)
or Metal Halide electric lamps in luminaires supported on poles, where the facilities for this service are
furnished by Company. Underground Service under this schedule is limited to areas having a Company owned
underground electric distribution system.
RATE
Designation of Lamp
70W High Pressure Sodium
100W High Pressure Sodium
150W High Pressure Sodium
250W High Pressure Sodium
400W High Pressure Sodium
175W Metal Halide
250W Metal Halide
400W Metal Halide
1,000W Metal Halide
Date Filed: 06 -30 -97
Docket No. E,G002/M -97 -985
E: RATES%CURRENTIMN ELECIME 5 074.DOC
Overhead
$8.70
$8.85
$10.15
$13.85
$17.70
$12.60
$15.90
$19.70
$28.95
Section No. 5
Original Sheet No. 74
Relocated from MPUC No. 1 Sheet No. 5 -39
Monthly Rate
Underground
$14.40
$14.75
$16.70
$20.00
$23.00
$20.40
$22.70
$25.45
$35.70
Per Luminaire
Decorative Purchase
Underground Option
$19.20 $5.45
$20.85 $6.45
$24.30 $8.50
$27.45 $11.95
$25.10
$27.10
$29.85
$40.10
PURCHASE OPTION SURCHARGE
A monthly surcharge per luminaire of 0.2% applies to the amount the purchase price exceeds $1,200.
$8.80
$10.10
$12.85
$23.10
RESOURCE ADJUSTMENT
Bills are subject to the adjustments provided for in the Fuel Clause Rider and in the Conservation Improvement
Program Adjustment Rider.
SURCHARGE
In certain communities, bills are subject to surcharges provided for in a Surcharge Rider.
LATE PAYMENT CHARGE
Any unpaid balance over $10.00 is subject to a 1.5% late payment charge or $1.00, whichever is greater, after
the date due. The charge may be assessed as provided for in the General Rules and Regulations, Section 3.5.
OTHER PROVISIONS
This schedule is also subject to provisions contained in Rules for Application of Street Lighting Rates.
By: James M. Ashley Effective Date: 02 -03 -98
General Manager, Marketing and Sales
Order Date: 02 -03 -98
January 28, 1998
Mr. Steve Stadler
City of Hopkins
1010 1 Street South
Hopkins, MN 55343
Re: Opinion of Probable Cost
Excelsior Blvd. Street Lighting
Hallberg Project #98 -2026
Dear Steve,
•
H A L L B E R G
ENGINEERING
We have prepared an opinion of probable cost for the Excelsior Blvd. project based on the
quantities indicated in the November 21, 1977 letter from Jim Rhodes at NSP. The following are
the results of our review:
Contractor Costs NSP Costs
Wiring and installation of all equipment $77,000 to $45,000
Cost of Fixtures and Poles* $95,000
Total $172,000 to $190 000 $226,294
Maintenance Costs ** $13,200 to $35,900 $71,040
*The cost for the fixtures and poles is approximately $1485 per fixture /pole combination (64
total).
* *The Contractor Costs are based on the following assumptions:
1) The $13,200 cost assumes, changing all the ballasts once for each fixture, and group
relamping of all fixtures twice during the 25 year period.
2) The $35,900 cost assumes, changing all the ballasts once for each fixture, and spot
relamping of the fixtures twice during the 25 year period.
* *The NSP Costs are based on the following assumptions:
1) NSP charges $6.45 per month per fixture for energy and maintenance, based on NSP's
September 30, 1997 letter.
2) Energy cost is approximately $2.75 per month per fixture assuming 190 watts pc.r
fixture (including ballast loss), $.04 per Kwhr, 12 hours per day (average) operation
and 30 days per month. This leaves $3.70 for maintenance costs($6.45- $2.75).
Mechanical /Electrical Consulting Engineers
2207 Third Street • White Bear Lake, MN 55110 • Phone (612) 429 -5655 • Fax (612) 429 -6215
•
3) Maintenance costs is approximately $3.70 per fixture times 64 fixtures times 12
months times 25 years. Our understanding is this covers all lamp replacement, labor for
ballast and pole replacement (City furnishes bal,sts and poles), and repair of
underground cables.
lvd
We confirmed our pricing by obtaining unit pricing for the installation from two electrical
contractors and obtaining fixture /pole pricing from two sources. Please note the costs are for the
electrical work only and do not include any costs for cutting and patching of sidewalks,
roadways, etc. An additional 5 - 8% savings may be realized in a competitive bidding
environment.
If you have any questions please call me at 407 -2361.
Sincerely,
HALLBERG ENGINEE4NG, INC.
Oleo
es R. Penkivech, P.E.
ice President/Principal
•
Nuv - ci - vi mu u.zu iN r
R5P
November 21, 1997
Steven Stadler
Public Works Director
City of Hopkins
1010 First Street South
Hopkins, Minnesota 55343
Mr. Stadler,
You requested more detail on the components involved in the Excelsior Boulevard
Street Lighting Proposal that NSP submitted in September of this year. Listed below
are the components and activities integral to installing the 64 King Luminaire
Florentine Poles (15' smooth tapered extruded aluminum shaft), and 64 King
Luminaire High Performance Acorn Fixtures (150 Watt (HPS), Type 1I).
/
• Install approx. 8,180 feet of #6 Triplex Cable in Gopher Pipe
• Directional bore 820 feet
• Dig, auger, and splice 30 splice pits
• Pull cable through approx. 720 feet
• Trench, back -fill and tamp approx. 6,640 feet
• Install 2 Secondary Pedestals
• Set 64 Screw -in Anchor Bases
• Install 64 Luminaries (poles, fixtures, lamps and fuseholders)
• Full Maintenance of all components within this system for 25 years
Again, thank you for the opportunity to work with you and the City of Hopkins in
improving your community. Please contact me at 630 -4282 to finalize or further
review this offer.
Regards,
� H. Rhodes
Community Service Manager
rtin 11U, 01CGJU4wuO r. ui
re,
Northern States Power Company
1518 Chestnut Street North
Minneapolis, MN 55403
Telephone 612/630 -4282