Board Members present: Dorothy Anderson, Susie Smith, Jeff Osanka, Mike Dyer, and Sandra Bishop.
Others present: Randy Berggren, Cathy Bloom, Tom Buckhouse, Marty Douglass, Dick Helgeson, Garry Kunkel, Jean Meyers, Roger Nelson, Jim Origliosso, Scott Spettel, Dick Varner, Debra Wright, John Yanov, and Krista Hince of the EWEB staff; and Kim Kunkel, Minutes Recorder.
President Anderson called the meeting to order.
POWER MANAGEMENT COMPENSATION REVIEW
General Manager Randy Berggren prefaced the presentation by noting that since the December 16 discussion regarding the Power Management Compensation Plan, staff has extracted and responded to, both in writing and meetings with individual Commissioners, questions raised by the Board. He said the written responses to those questions were included in the meeting agenda packet. Mr. Berggren said that while the Board would have an opportunity to take action that evening, an additional opportunity will be provided during the February 3 Board Meeting if necessary.
Jean Meyers, Human Resources Specialist, stated that the objectives of the Work Session were to
Ms. Meyers presented a brief overview of the aforementioned staff responses to Board questions concerning the Power Marketing Compensation Plan and solicited additional questions.
President Anderson stated that she found the GENCO quarterly reports to be of value and inquired as to whether the Board might receive such reports concerning the Power Management Compensation Plan. Debra Wright, Risk Manager, indicated that such reports could be generated. Mr. Berggren said staff intends to present updates to the Board in July, October, and January.
Referring to a series of overhead displays, Power Resource and Planning Manager Scott Spettel presented an overview of the base salary structure and goals of the plan, noting in particular the following:
Mr. Spettel presented an overview of proposed performance levels (threshold, target, maximum, and actual) for each weighted goal, followed by a review of the proposed payouts at actual performance for each goal. He said simulation of the plan that has been in place over the last 12 months reveals that while EWEB power marketers are currently above threshold, target performance levels have not been met.
Ms. Meyers inquired as to whether the Board was prepared to take action that evening or would prefer to defer action until February 3.
Noting that she was comfortable with the information presented, Vice President Smith expressed her opinion that incentives should not be paid to employees who fail to achieve satisfactory performance evaluations, regardless of whether they are achieving target performance levels in power marketing. Vice President Smith said she was satisfied with staff's responses to the Board's questions and indicated an interest in the aforementioned quarterly reports.
Mr. Spettel clarified that, based on Vice President Smith's concern, the answer to Board question number 7 should be amended to state "The proposed power marketing compensation plan can be amended to specify that no employee with sub-standard performance shall be eligible for an incentive payment." The Board expressed support for the amendment.
Commissioner Bishop expressed concern regarding the term "ability to pay." She inquired as to how EWEB might safeguard the pay-outs to power marketers against organization-wide budget difficulties. Ms. Wright said she understood Commissioner Bishop to be suggesting that the compensation plan for power marketers be identified as including incentives. Therefore, if EWEB experienced a budget crisis in which it had to reduce by a percentage the salaries of all employees, the reduction made to power marketers' salaries would include incentives.
Vice President Smith expressed concern that because no public utilities were included in the salary survey used to prepare EWEB's proposed salary levels, it may be challenging to communicate to the public the need for a power marketing compensation plan. Ms. Meyers said that of the public utilities she has surveyed, EWEB is almost parallel with Chelan PUD in terms of salary. She offered to share this data with Commissioners.
Referring to Board question number 1, "Should EWEB be participating in the power marketing activities?," Commissioner Bishop said she objected to the question because it is the very nature of the organization to participate in such activities. Vice President Smith suggested rewording the question to ask "Why is EWEB participating in power marketing activities?"
The meeting adjourned at 6:45 p.m.