Board Members present: Dorothy Anderson, Sandra Bishop, Mike Dyer, Jeff Osanka, and Susie Smith.
Others present: Randy Berggren, Manda Bednarczyk, Ken Beeson, Tom Buckhouse, Marty Douglass, Dick Helgeson, Dale Kessinger, Garry Kunkel, Roseanna McArthur, Kris Middlewood, John Mitchell, Jim Origliosso, Laurie Power, Dick Varner, and Krista Hince of the EWEB staff; Lance Robertson, The Eugene Register-Guard; Moshe Immerman, member of the public; and Kim Kunkel, minutes recorder.
President Anderson called the meeting to order.
MINUTES
The Commissioners reviewed the minutes of the October 7, 1997, Regular Board Meeting.
Referring to paragraph 3 on page 3 of the minutes, President Anderson requested that sentence 2 be amended to read "She said the Board also discussed the continuing challenge of EWEB's relationship with the City and EWEB's compensation plan."
Referring to paragraph 5 on page 8 of the minutes, Commissioner Bishop requested that sentence 3 be amended to read "Referring to a memorandum from Dale Kessinger that was included in the meeting agenda packet, Commissioner Bishop said the recent change issued by PGE with regard to its conditions for allowing public-owned utilities to compete in the provision of electric services may be of interest to EWEB."
Vice President Smith moved, seconded by Commissioner Osanka, to approve the minutes of the October 7, 1997, Regular Board Meeting. The motion passed unanimously.
Commissioner Bishop requested that future minutes include a list of the correspondence items reviewed by Mr. Berggren.
CORRESPONDENCE
General Manager Randy Berggren reviewed the following information items included in the meeting agenda packet:
Commissioner Osanka said he was disappointed that the information concerning tree trimming/removal that was provided to the Board did not include language regarding the process through which EWEB went in making the decision to remove trees near the Walterville property. Noting that either information regarding an EWEB tree trimming/removal policy was omitted from the meeting agenda packet or it simply does not exist, Commissioner Osanka requested a board-level discussion of EWEB's tree trimming/removal policy.
Mr. Berggren responded that tree removal near the Walterville property is an operational issue and clarified that the information included in the meeting agenda packet represents a baseline of EWEB's tree trimming/removal practices.
Commissioner Dyer responded that the tree trimming/removal issue is a matter which staff should address. He said staff is aware of Commissioners' views regarding the issue.
Vice President Smith noted that Weyerhaeuser created a natural resources map to inform tree trimmers about issues of tree trimming/removal and the scrutiny to which tree removal is subject. Vice President Smith inquired as to whether a proposal to remove trees in a sensitive area would trigger Board discussion. Mr. Berggren said it would. Given this, Vice President Smith expressed her opinion that staff should have the flexibility to make tree trimming/removal decisions. She suggested providing Commissioner Osanka with a copy of the aforementioned natural resources map.
Commissioner Bishop said she would like to know the definitive point at which tree trimming/removal becomes more than a routine staff decision. Commissioner Osanka reiterated his interest in a board-level discussion regarding EWEB's tree trimming/removal policy or lack thereof.
Ms. Powers stated that in 1993, EWEB developed internal operating procedures concerning tree trimming and felling with a focus on environmentally sensitive areas. She said staff can provide to the Board copies of these procedures.
PUBLIC INPUT
Moshe Immerman, 888 Almaden Street, spoke to the proposed Environmental Policy that was scheduled as the next item of discussion. Mr. Immerman stressed the importance of making public health and quality of life central to such a policy. With regard to the proposed Organizational Purpose and Vision addressed during the preceding work session, Mr. Immerman questioned why EWEB was seeking to create an organizational purpose statement when its purpose is well defined in the existing EWEB Bylaws. He said the proposed purpose statement seems parallel to the bylaws; however, it excludes the issue of providing power at the "lowest cost" possible.
In addition, Mr. Immerman suggested that the Environmental Policy include more emphasis on fostering a sustainable energy future and include a statement regarding whether EWEB has a regional or national legislative agenda by which to represent the public. He said he doubts that the interests of citizens and customers, particularly large industrial customers, overlap and it is therefore important that they be represented separately.
Furthermore, Mr. Immerman requested that the Environmental Policy include clear language reflecting EWEB's views on environmental stewardship. Mr. Immerman requested feedback from staff and the Board regarding EWEB's involvement in water quality issues and why EWEB is creating a purpose statement that appears parallel to the existing bylaws.
With regard to why EWEB is creating an organizational vision statement, President Anderson responded that the statement is being created in order to pull together and organize a number of elements. She said changing the bylaws will not be a part of this effort.
ENVIRONMENTAL POLICY
Referring to an October 14 memorandum included in the meeting agenda packet, Environmental Manager Laurie Power discussed background information and reviewed the attached Draft Environmental Policy. She said EWEB legal counsel has reviewed and approved the language of the draft document.
Ms. Power noted that it was important to bear in mind the purpose of an environmental policy. She stated her opinion that the policy has external and internal applications. Externally, the policy reflects EWEB's image and intent to the community, employees, suppliers, and regulators. She stressed that it also should provide EWEB with a competitive advantage by differentiating EWEB to its residential, commercial, and industrial customers. Internally, the policy codifies EWEB's commitment to the environment and drives strategic and operational decision-making.
Ms. Power noted that the proposed Environmental Policy fits into a larger context of an overall environmental management system for EWEB. She said the environmental audit program has been revised and now incorporates some of the Internal Organization for Standardization (ISO) environmental management system standards, and EWEB is looking at other ways to address environmental issues in a systematic manner and thereby improve environmental performance. Ms. Power said a key element of the management system is the environmental policy.
Ms. Power solicited comments and questions from the Board.
Vice President Smith said she liked the proposed policy. Commissioner Dyer said he liked that the proposed policy says EWEB will take responsibility for its actions rather than claiming that it will "change the world."
Commissioner Osanka suggested that a future draft of the policy utilize stronger language by stating that EWEB takes responsibility for the environmental consequences of its actions. In addition, Commissioner Osanka wondered if the proposed policy "has teeth" to it and inquired as to the likelihood that a future Board would have to amend the proposed policy in order to implement a low-cost source of fuel generation such as a coal fire plant. In response to whether the proposed policy would constrain EWEB from building a coal fire plant, Ms. Power noted that EWEB's current energy plan has thermal energy at the bottom of the preferred energy list. However, she said all EWEB policies are living documents subject to revision by future Boards.
Referring to the draft policy document, Commissioner Bishop said it is false to claim that among the objectives for EWEB's environmental commitment is the provision of "resources that are renewable, sustainable, and have minimal environmental impact to meet our customers' needs." She said EWEB already has in its portfolio resources that are non-renewable and the utility purchases power on a grid which does not facilitate minimal environmental impact. President Anderson responded that she had interpreted the aforementioned objective in terms of EWEB's generation, as opposed to provision, of renewable resources.
Commissioner Osanka said that he liked Commissioner Dyer's "EWEB takes responsibility for the environmental consequences of our actions," and proposed that this be added as the first sentence of the policy.
The Board proposed and agreed to a number of suggested revisions and decided to defer action on the document until the changes have been incorporated into a new draft and reviewed by Commissioners.
TELECOMMUNICATIONS BONDING AUTHORITY
Referring to an October 15 memorandum included in the meeting agenda packet, Energy Resource Projects Manager Ken Beeson reviewed both background information and projected project costs and presented a proposal for authorization of bonding authority and a phased approach to the proposed telecommunications system construction. Noting that there remain a number of open questions with regard to the proposed telecommunications financing strategy, Mr. Beeson said staff will address those questions prior to requesting Board approval. He said that on November 18, having addressed those questions and considered additional input from Commissioners, he plans to request Board approval of a resolution to initiate the bonding authority process.
Vice President Smith said it was important that EWEB approach the City and work toward establishing a partnership agreement that might include a waiver of the City's new right-of-way fees in exchange for both the financial capability EWEB brings to the project and the risk it assumes.
Mr. Beeson requested Board approval of the following recommendation with regard to moving forward with development of the telecommunications system:
A. Divide the project into Phase I with an estimated cost of $13 million and Phase II with an estimated cost of $60 million. The total project is estimated to cost $70-75 million.
B. Proceed with authorization of the bonding authority for Phase I using the URBA process with an option for the issuance of project revenue bonds or electric system revenue bonds. With the Board's concurrence, staff with submit a resolution to Commissioners on November 18 to start that process. Staff is also assuming that the Eugene City Council will need to concur before public notice is given to begin the 60-day remonstrance period as prescribed under the statute.
C. In January 1998, once the remonstrance period has run, consider beginning construction of the initial portion of the system using cash reserves and then, depending on the level of firm revenue commitment, consider issuance of electric system revenue bonds or project revenue bonds to reimburse all or a portion of EWEB's cash expenditures.
D. In 3-5 years, once the initial system is complete, consider a bond election to finance construction of Phase II which will include a complete build out to the area homes and businesses.
Commissioner Bishop said it was difficult for her to enter into a process in which the decision to build-out is deferred for 3-5 years. She expressed concern that EWEB is entering into a large project without certainty of moving forward. Mr. Beeson said EWEB's intention is to
Commissioner Bishop said it seems as though EWEB must make a commitment in order to obtain subscriptions. Noting that she does not perceive the project as having public benefit until Phase Two, Commissioner Bishop said she will only support a recommendation that provides certainty of moving forward with Phase II. She stressed that Phase One must be a vehicle to Phase Two.
Commissioner Osanka echoed Commissioner Bishop's concern. He said he did not want EWEB to obtain revenue from Phase One, only to decide against proceeding with future phases. Commissioner Osanka said he would like more details of the pilot projects established before making a decision on this matter. In addition, he said he wants both the proposed pilot projects to move forward as opposed to the Board selecting one.
In response to Mr. Beeson's request for feedback, the Board confirmed its general support for the recommendation.
UNDERGROUND TASK FORCE UPDATE
Referring to an October 16 memorandum included in the meeting agenda packet, Acting Public Affairs Manager Marty Douglass presented a summary of discussion that took place at the first meeting of the EWEB/City of Eugene Underground Task Force. The October 14 meeting included a brainstorming session regarding criteria or objectives to be addressed when considering an undergrounding strategy. The criteria/objectives ranged from collaborating on respective Capital Improvement Plans as a means of identifying potential undergrounding areas to enacting long-term, 50-year plans for undergrounding the overhead system.
Mr. Douglass said two important objectives brought up by EWEB included careful consideration given to the potential impacts on EWEB's budget, as well as determining the extent of public interest/feedback so far and the degree of future public involvement in this process. He said there was also discussion about the need to prioritize the criteria/objectives that were brought up.
Mr. Douglass said the task force asked staff to research and bring back information on a number of items, including more information on the public safety issues associated with overhead lines, instances when EWEB conducted undergrounding of its existing system, the extent of customer/citizen feedback that has occurred so far, information on reliability factors and maintenance issues associated with underground systems, maps of existing systems, and a determination of where the respective Capital Improvement Plans might align with each other on certain projects.
Mr. Douglass said the brainstorming/information gathering will continue into the next meeting, which is scheduled for November 25 at EWEB. Noting that a third meeting has been scheduled for December 17, Mr. Douglass said no timetable for decisions has been determined.
NEW CITY OF EUGENE RIGHT-OF-WAY FEES
Referring to an October 16 memorandum included in the meeting agenda packet, Mr. Douglass said the attached letter from Fred McVey, City of Eugene Public Works Maintenance, was in response to the Board's request that EWEB and/or City staff clarify issues and address Commissioners' concerns regarding the new City of Eugene right-of-way fees.
President Anderson reported that she has not yet received a response to her letter sent to Mayor Jim Torrey requesting that City Council Officers meet with EWEB management. She predicted that the likelihood of meeting with the entire City Council was slight.
With regard to a draft letter from EWEB to the Eugene City Council, Commissioner Bishop said it presents too many issues. She suggested simplifying the letter to clearly state the issue of whether there is room to continue negotiating about the equity of requiring EWEB to pay the new right-of-way fees. She said it was important to stress that EWEB acknowledges the City's rationale for implementing a right-of-way fee; however, the proposed fee is too high and EWEB simply wants to determine what amount is equitable.
Commissioner Bishop said it is important that EWEB does not push so hard that it is then treated differently than other utilities because that will only fuel the perception that EWEB is merely another City department. She said it is her belief that City Council is unaware of the fact that implementing the proposed level of fees will add to the existing distrust of government because EWEB will be forced to pass on the newly incurred cost to its customers.
President Anderson said she thinks EWEB must convey precisely why the proposed fees are unfair in order to be heard by City Council.
Commissioner Osanka noted the difficulty of providing such specificity, given that City staff has not provided EWEB with specific details regarding the costs reflected in the new fees.
With regard to Commissioner Bishop's suggestions concerning the letter to City Council, Vice President Smith said she thinks EWEB lacks sufficient factual information to make such statements. She said the proposed fees may be equitable compared to what is charged other utilities operating in the right-of-way. Vice President Smith said this situation is symptomatic of the lack of a working relationship between EWEB and the City and the proposed letter is too inflammatory. She suggested sending a more general letter that raises the issue of policy and maintains an open line of communication with City Council. Noting that she would abstain from voting on whether to send the letter, Vice President Smith suggested that if the letter is sent that it be softened by deleting the word "protest" and that it simply state that EWEB is uncomfortable with the proposed fees, confused about its relationship with the City, and would like to establish a dialogue.
Commissioner Dyer posited that the amount of the new fees may be defensible and suggested asking the City to provide specific information regarding the costs reflected in the fees. In addition, he suggested including in the letter EWEB's desire that in the future, the City and EWEB immediately and effectively communicate regarding matters such as this.
Commissioner Bishop suggested that the first sentence of the letter state EWEB's objective. In addition, she said the letter should include EWEB's vision of what a policy level discussion between the utility and the City would entail. Commissioner Bishop said the letter should also include a request that the City defer implementing into permanent status its new right-of-way fees until EWEB has the opportunity to negotiate specific conditions of the fee.
Vice President Smith requested information regarding right-of-way fees paid by other utilities.
President Anderson said it was important that EWEB stress the need to create a collaborative relationship with the City.
Commissioner Bishop offered assist Mr. Douglass in drafting a letter for the Board's review. The Board, with the exception of Vice President Smith who abstained, expressed support for Commissioner Bishop's proposal.
ITEMS FROM BOARD MEMBERS
President Anderson announced that the McKenzie Watershed Council will host a water quality forum on November 15. She said the forum is in response to concerns about the impacts of logging and other activities on the quality of McKenzie River water.
Vice President Smith announced that she would be unavailable for Board business the first three weeks in January.
The meeting adjourned at 10:10 p.m.