Board Members present: Dorothy Anderson, Susie Smith, Jeff Osanka,
Mike Dyer, and Sandra Bishop.
Others present: Randy Berggren, Manda Bednarczyk, Tom Buckhouse,
Marty Douglass, Dick Helgeson, Garry Kunkel, John Mitchell, Roger
Nelson, Jim Origliosso, Dick Varner, John Yanov, and Krista Hince of
the EWEB staff; Frank Nearing, KLCC Radio; and Kim Kunkel, minutes
recorder.
President Anderson called the meeting to order.
ELECTION OF OFFICERS
Commissioner Bishop moved, seconded by Commissioner Osanka, to remove from the table the motion, moved and seconded on January 6, to nominate Vice President Smith as EWEB Board President and Vice President Osanka as EWEB Board Vice President for 1998; and the amendment, moved on January 6, to amend the original motion to state that the Board has determined the word "seniority" means that by regular order Commissioner Osanka would be elected Board President in 1998. The motion passed, 4:0, with Vice President Smith abstaining.
Commissioner Bishop explained that she would vote in favor of the amendment not because she wanted a particular person to serve as President or Vice President, but rather for process-related reasons.
The amendment to the original motion failed, 3:2, with Commissioners Osanka and Bishop voting "yes."
Commissioner Bishop clarified that the discussion she ignited during the January 6 meeting concerning the election of officers was intended as a means by which to gain clarity regarding seniority and was not meant to target anyone on the Board. She requested that Commissioners support Vice President Smith in becoming Board President. In addition, Commissioner Bishop requested a commitment by the Board to discuss the issue of seniority at the upcoming Board Retreat.
Commissioner Osanka expressed his opinion that the Board should adhere to the standard Dictionary definition of "seniority." He said he believes the intent behind rotation is to provide constituents the opportunity to have their elected representative serve as President. Commissioner Osanka said he would not have served his constituents well had he not challenged the current rotation process.
Citing the history behind the development of the EWEB Bylaws language related to seniority, Vice President Smith said the intent was to create a-political officers who could facilitate the Board and serve as key liaisons to the public. Vice President Smith said she respected Commissioner Bishop's request to address the issue of seniority at the upcoming retreat.
President Smith said she agreed with Vice President Smith in that the focus of the Board should not be ward versus ward politics, but rather how it can assist in the effective function of the utility.
The original motion passed, 4:1, with Commissioner Osanka opposed.
President Smith presented a brief overview of the process she will
use to facilitate meetings.
AGENDA CHECK
General Manager Randy Berggren said agenda item 5, Presentation From Rachael Shimshak, Renewable Northwest Project, would be deferred due to the illness of the presenter.
MINUTES
The Commissioners reviewed the minutes of the December 16, 1997, Work Session and Special Board Meeting.
Referring to page 3 of the Work Session minutes, Commissioner Bishop requested that paragraph 3 be amended to refer her question regarding whether individual incentives had been considered, and Mr. Spettel's response that team incentives have proven successful.
Referring to paragraph 1 on page 5 of the Special Board Meeting minutes, Vice President Osanka requested that sentence 3 be amended to read "Commissioner Osanka said he opposes including a subsidy for builders of low-income housing, approved as part of the SDC vote in December 1996, and would like the Board to discuss the possibility of an electric rate decrease that would make a water rate increase more palatable."
Vice President Osanka moved, seconded by Commissioner Bishop, to
approve the minutes of the December 16, 1997, Work Session and
Special Board Meeting, as amended. The motion passed unanimously.
CORRESPONDENCE
In response to a request by Mr. Berggren that the Board consider scheduling two retreats, Commissioners identified March 13 and 14 as possible dates for the first retreat, and May 1 and 2 for the second retreat.
Mr. Berggren noted that a memorandum concerning Portland General Electric's divestiture of generation assets was included in the meeting agenda packet.
Noting that he, Commissioner Bishop, and Commissioner Anderson recently met with Mayor Torrey and City Councilors concerning the "hole tax," Mr. Berggren said it appears unlikely that EWEB will see a reduction in its fees. Commissioner Bishop said the meeting was productive in terms of addressing the issue of how EWEB and the City will interact in the future. She said EWEB must educate City Council regarding the utility's relationship to the City. Commissioner inquired as to whether EWEB has put in writing its understanding of the City's position based on the meeting. Mr. Berggren said staff can codify what was heard during the meeting.
Mr. Berggren reviewed draft agendas for the February 3 Work
Session and Regular Board Meeting.
PUBLIC INPUT
There was no public input.
POWER MANAGEMENT COMPENSATION
Noting that this item was discussed during the preceding Work Session, Mr. Berggren reviewed issues relative to EWEB's need to adopt a Power Management Compensation Plan and requested Board approval.
Vice President Osanka moved, seconded by Commissioner Bishop, to authorize staff to move forward with the Power Management Compensation Plan, as proposed, with the understanding that staff take into consideration the Board's input and that the Board be provided with quarterly reports. The motion passed unanimously.
DISCUSSION OF GENERAL WAGE ADJUSTMENT
Referring to a memorandum included in the meeting agenda packet, Fiscal Services Supervisor Dick Varner stated that the 1998 Budget included an assumption that overall compensation would increase 2.7 percent. This was to be used either for a general increase in the existing pay plan or for implementation of a new pay plan. Given the current schedule, the likely implementation of a new pay plan would not occur before January 1999. Mr. Varner said it thus seems appropriate that EWEB provide a general wage adjustment consistent with the West C CPI.
Noting that the West C CPI increased by 2.8 percent for calendar 1997, Mr. Varner said he is recommending that a general wage adjustment of 2.8 percent be given effective January 1, 1998.
In response to a question from Vice President Osanka regarding the relative meaning of the West C CPI, Mr. Berggren said a discussion concerning the meaning of the C CPI may be valuable as part of the compensation plan development process. Noting that the labor index, in response to the unemployment level, was at 4.2 percent, Mr. Berggren explained that each index is driven by different factors.
Commissioner Dyer stated that although he supports the West C CPI as a precedent, he would like EWEB to consider utilizing a more realistic index for its future compensation plan. Vice President Osanka concurred.
Vice President Osanka moved, seconded by Commissioner Dyer, to approve the general wage adjustment of 2.8 percent effective January 1, 1998. The motion passed unanimously.
REFINANCING OF 1994 "C" BONDS
Referring to a memorandum included in the meeting agenda packet, EWEB Treasurer Jim Origliosso requested Board approval of a Bond Resolution authorizing the issuance of the Electric Utility System Revenue Refunding Bonds. He said that given Board approval of this resolution, staff will request approval of a supplemental resolution during the February 3 Board Meeting.
Vice President Osanka moved, seconded by Commissioner Bishop, to approve a supplemental resolution authorizing the issuance of not to exceed thirty-five million dollars ($35,000,000) aggregate principal amount of Electric Utility System Revenue Refunding Bonds, Series 1998, of the city of Eugene, Oregon, for the purpose of refunding in advance of maturity certain outstanding Electric System Revenue Bonds of the City originally issued to finance improvements to the City's Electric Utility System Distribution Division; ratifying submission of an advance refunding plan to the Oregon State Treasurer; approving the preparation of a preliminary official statement, refunding trust agreement, bond resolution and related documents; appointing Bond Counsel, and Senior Managing Underwriter; authorizing certain other acts in connection with the sale of said bonds. The motion passed unanimously.
WATER RATES
Referring to a memorandum included in the meeting agenda packet and a series of overhead displays, Senior/Financial Rate Analyst John Yanov presented the general context and underlying fundamentals of the assumed need, reflected in the 1998 Water Utility Budget, for a general water rate increase of approximately 6 percent. Mr. Yanov explained the need for a rate increase in terms of
Noting that the Eugene City Manager has suggested EWEB and the City work together on capital improvement projects, Commissioner Anderson inquired as to whether joint ventures were a possibility. Mr. Helgeson said staff could look into joint bidding opportunities.
Commissioner Dyer inquired as to whether EWEB, if it were successful in securing rates better than marginal costs with respect to Hyundai or another major customer, could offset the Water Utility deficit. Mr. Helgeson said that was possible.
Vice President Osanka expressed information regarding what budgeted items would have to be cut in order to avoid a rate increase. Commissioner Bishop requested a list of budgeted items that must be continued for the general welfare of the utility. Mr. Berggren responded that staffing and conservation are the only discretionary items included in the Water Utility Budget.
Vice President Osanka requested that staff present rate increase options of 0, 3, and 5 percent.
Commissioner Dyer expressed concern regarding the phenomenon of implementing a rate increase to recuperate money lost by deferring past rate increases. He said he wants to see the utility's budget level out.
Commissioner Bishop expressed concern regarding public perception of a rate increase. She said constituents want EWEB's assurance that a rate increase is not used to support new customers or industrial growth. She said EWEB must communicate the fact that development will pay for itself. Commissioner Bishop said conducting a public hearing is a means by which to communicate that fact.
Vice President Osanka stated that if the Water Utility cannot function effectively without a rate increase, that fact should be communicated as a Board statement prior to a public hearing in order to quell any expectations by members of the public that a rate increase can be avoided.
President Smith said there are two separate issues at hand:
Commissioner Anderson expressed support for moving forward with the proposed 6 percent water rate increase.
President Smith suggested that
President Smith determined a majority of the Board members were comfortable with proceeding with the water rate increase proposal.
STEAM RATES
Referring to a memorandum included in the meeting agenda packet, Fiscal Services Supervisor Dick Varner addressed the following elements of the 1998 steam rate adjustment:
Mr. Varner said the budget gap is now closed due to recent staffing changes that resulted in a reduction of 1.5 FTE. He said staff recommends both no change in EWEB's base steam rates and continued use of the existing fuels adjustment mechanism. Mr. Varner said no Board action was required.
ITEMS FROM BOARD MEMBERS
Commissioner Dyer acknowledged Commissioner Anderson for her two years of Board presidency.
The meeting adjourned at 9:15 p.m.