Board Members present: Dorothy Anderson, Sandra Bishop, Mike Dyer, and Jeff Osanka.
President Smith was excused.
Others present: Randy Berggren, Manda Bednarczyck, Chuck Bodine, Marty Douglass, Dick Helgeson, Krista Hince, Jill Hoyenga, Garry Kunkel, Roseanna McArthur, Mark Oberle, Jim Origliosso, Jenean Rigney, Dick Varner, and Steve West of the EWEB staff; KVAL-Television; various members of the public; and Kim Kunkel, Minutes Recorder.
In the absence of President Smith, Vice President Osanka called the meeting to order.
AGENDA CHECK
Vice President Osanka determined there was consensus to approve the agenda, as written.
MINUTES
The Commissioners reviewed the minutes of the June 16, 1998, Executive Session and Special Board Meeting.
Referring to paragraph 5 on page 4 of the Special Board Meeting minutes, Commissioner Bishop requested that sentence 3 be amended to read "Commissioner Dyer stated that it is politically unfeasible to raise Mr. Berggren's salary to market level at this time; however, because it appears to be agreed among a majority of the Board that Mr. Berggren's continued presence at EWEB is critical to the utility's ability to remain competitive, Commissioners Bishop and he are proposing a supplemental retirement plan based on a $35,000 shortfall over the next 8 years."
Referring to page 1 of the Special Board Meeting minutes, Commissioner Bishop requested that paragraph 4 be amended to read "Commissioner Smith announced that Commissioner Anderson was recently awarded the City Club's "Turtle Award" for "sticking out her neck" in service to the community."
Referring to page 3 of the Special Board Meeting minutes, Commissioner Bishop requested that sentence 2 be amended to read "She expressed support for a formal review process, such as a Request For Proposals (RFP), or some less costly process such as a Request For Information or the development of an annual review process less onerous than an RFP."
Referring to page 4 of the Special Board Meeting minutes, Commissioner Bishop requested that paragraph 3 be amended to read "Commissioner Bishop requested that staff provide information regarding EWEB's legal services contracts outside of General and Special Counsel to get a more comprehensive overview of the total cost and type of legal services utilized by EWEB."
Referring to paragraph 1 on page 5 of the Special Board Meeting minutes, Commissioner Bishop requested that sentence 1 be amended to read "Commissioner Dyer presented a brief overview of the proposed supplemental retirement plan, classifying it as a "non-qualified deferred compensation plan for a public agency."
Referring to paragraph 1 of page 5 of the Special Board Meeting minutes, Vice President Osanka requested that sentence 3 be amended to read "Beginning January, 1998, and repeated every January through 2006, $35,000 plus 8 percent will be accrued as a liability. To round up to $280,000 to $300,000, $55,000 plus 8 percent will be accrued as a liability in the first year of the plan."
Referring to the final sentence of paragraph 1 on page 6 of the Special Board Meeting minutes, Commissioner Bishop requested that "document" be replaced with "contract."
Referring to sentence 2 of paragraph 3 on page 7 of the Special Board Meeting minutes, Commissioner Bishop requested that "promotion" be replaced with "promote."
Referring to page 6 of the Special Board Meeting minutes, Vice President Osanka requested that it be noted, prior to the conclusion of the General Manager's Contract Review discussion, that General Manager Randy Berggren thanked the majority of the Board for approving the contract language.
Commissioner Dyer moved, seconded by Commissioner Bishop, to approve the minutes of the June 16, 1998, Executive Session and Special Board Meeting, as amended. The motion passed unanimously.
ITEMS FROM BOARD MEMBERS
Commissioner Bishop requested that she be excused from the August 11 Board Meeting as she will be attending a special session of the legislature.
Vice President Osanka inquired as to whether four EWEB Board members, excluding himself, retained the services of EWEB's Public Service Department in issuing their recent letter to the Register-Guard. Commissioner Anderson responded that the Public Services Department served as a gatherer of information for the joint letter. General Manager Randy Berggren noted that utilizing the Public Services Department is common practice with respect to issues approved by a majority of the Board. Noting that a constituent had questioned the ethics of the four Board members utilizing the Public Services Department to draft a letter to the Register-Guard, Vice President Osanka suggested that this practice be re-evaluated.
Vice President Osanka moved to include as an item on next month's meeting agenda discussion regarding the fact that the Board members' letter to the Register-Guard did not address the editorial's criticism that the Board's consideration of Mr. Berggren's Supplemental Retirement Plan was limited to average salaries of General Managers of large and medium municipal utilities, and that the medium and mode figures were not listed. The motion died for lack of a second.
CORRESPONDENCE
Mr. Berggren announced that the annual EWEB picnic is scheduled for July 25. In addition, he announced that EWEB's new Human Resources Manager, Sandy DeLuna, began work July 1.
Mr. Berggren reviewed draft agendas for the July 14 Work Session and Special Board Meeting.
Vice President Osanka requested that EWEB respond to a letter issued to the Board from Christopher Horton. The letter questioned the Board's recent approval of a Supplemental Retirement Plan for General Manager Randy Berggren.
Noting that Mr. Horton's letter included no request for a response, Commissioner Bishop said she was not inclined to respond.
PUBLIC INPUT
Nick Urhausen, 2850 Warren Street, stated his objection to the Board's recent approval of a Supplemental Retirement Plan for General Manager Randy Berggren. He said there is an advantage to living in Eugene, and compensating Mr. Berggren to discourage him from leaving the area is "ridiculous." Mr. Urhausen said the concept behind deregulation is to increase competition and benefit consumers--not Mr. Berggren. In addition, Mr. Urhausen said the 8 percent interest provided under the plan is extremely high and will result in Mr. Berggren receiving approximately a half a million dollars in supplemental retirement income when he retires.
Rick Szakalski, 2150 Brittany Street, stated that when he read the letter to the editor concerning the General Manager's Supplemental Retirement Plan, he was initially under the impression that the Board was deliberating the matter and would seek public input prior to a final decision. He said that as he continued to read, it became clear that the decision had already been made. Mr. Szakalski said EWEB should inform the public of where the funds will come from to pay for a plan worth $500,000. He requested that the Board reconsider its decision and schedule a public hearing on the matter.
WATER CONSERVATION STRATEGIES
Referring to a memorandum included in the meeting agenda packet, Water Management Services Supervisor Steven West said the purpose of this presentation was to provide the Board with an overview of Water Management Services' work in the areas of water conservation, water safety, and customer information/education. He said three notable themes of the presentation would be Continuity, Community, and Partnership. Mr. West said that following the presentation, staff would present to the Board a resolution proclaiming that EWEB supports the concept of a community-based conservation program that emphasizes efficient use of water resources and system facilities, and is committed to working with other agencies and individuals toward common conservation objectives, consistent communication, and partnerships to efficiently utilize shared resources.
Mr. West introduced Water Management Services staff members Chuck Bodine, Jill Hoyenga, and Jenean Rigney.
Mr. West stated that since its inception in 1996, Water Management Services' charge has been to build a water use management program at EWEB. He said that under that charge, the group has focused on three areas:
Mr. Bodine, Water Management Specialist, explained that as a regulatory requirement, EWEB has been involved in backflow prevention (water safety) since 1974. He said this program ensures EWEB's compliance with the requirement and works to protect EWEB's water system and EWEB's customers from contamination generated in the customer's piping. Mr. Bodine said this is accomplished with the installation and annual testing of backflow prevention devices any place where non-potable uses are connected to the drinking water piping.
Mr. Bodine stated that EWEB takes a customer advocate approach in its backflow prevention work. He said EWEB's goal is to minimize the cost and maximize the convenience of compliance. This is accomplished by building continuity in the enforcement of the OAR requirements and the plumbing code, and by partnering with the installers, testers, neighboring water suppliers, and other agencies to assist EWEB's customers in every possible way. Mr. Bodine said the success of the program is measured by:
Mr. Bodine said new functions of EWEB's backflow protection program include
Mr. Bodine said he considers customer education the most effective component of the backflow protection program.
Ms. Hoyenga, Water Management Specialist, presented an overview of Water Management Services' residential water audit program, EWEB's water curriculum project, and EWEB's "peak" campaign. With regard to the residential water audit program, Ms. Hoyenga explained that EWEB invites the participation of residential customers identified through billing records as being in the utility's top 10 percent in terms of monthly water use. She said EWEB evaluates the indoor and outdoor water use of these customers (approximately 4,000 on average) in terms of the potential for savings. She said each participating customer receives a written report tailored to their specific water use situation.
With regard to EWEB's water curriculum project, Ms. Hoyenga said the curriculum is designed for students of all ages. She said the curriculum is intended to assist students in
Ms. Hoyenga stressed that the curriculum must consist of "real world" lessons that students can take home and apply.
Ms. Hoyenga explained that EWEB's "peak" campaign is designed to educate customers about peak demand and how to manage water use to reduce peak. She said planning and development work for the campaign takes place during winter months in preparation for the many open houses and public events that take place between March and September. Ms. Hoyenga said the 1998 "peak" campaign will focus on using "ET" with sprinkler timers.
Mr. West requested that the Board approve the resolution to support a concept of community-based conservation program.
Commissioner Dyer moved, seconded by Commissioner Bishop, to approve the resolution proclaiming that EWEB supports the concept of a community-based conservation program that emphasizes efficient use of water resources and system facilities, and is committed to working collaboratively with other agencies and individuals toward common conservation objectives, consistent communication, and partnerships to make the most of our shared resources.
Vice President Osanka noted that the meeting agenda failed to indicate that the Board would take action on this matter. He inquired as to whether failing to notice this action could have ramifications that should considered prior to a vote by the Board. Mr. Berggren responded that the lack of notice on the agenda was merely a technicality. He said the proposed resolution was intended to create visibility of the Board's support for the conservation program. He said that if the Board was opposed to taking action that evening due to the lack of notice, the resolution could be re-submitted during the next meeting.
Commissioners Anderson and Dyer said they were not opposed to taking action at that time.
Vice President Osanka proposed that if action is not properly indicated for items appearing on future meeting agendas, and Commissioners are uncomfortable taking action, the Board should adopt the practice of deferring the item until the following meeting. Vice President Osanka determined there was Board consensus in favor of his proposal.
WATER LINE EXTENSION POLICY REVISIONS
Referring to a memorandum included in the meeting agenda packet, Water and Steam Divisions Director Dick Helgeson explained that the current version of EWEB's Water Main Extension Policy contains a provision which allows customer/developers to contract with EWEB to finance extension costs for a period of up to 10 years. The provision also includes language regarding related surety requirements to "unconditionally" guarantee the extended payment terms.
Mr. Helgeson stated that although this policy provision has been in place for many years, it has never been applied, except on a very limited, short-term basis with specific approval by the Board. He said requests for such financing have been extremely rare, and are generally not granted due to the very restrictive surety requirements.
Mr. Helgeson explained that based on five specific observations made by staff, and noted in the aforementioned memorandum, staff strongly recommends deletion of the current provision for financing of water main extensions. He said no other changes to the Water Main Extension policy are proposed at this time.
Commissioner Dyer moved, seconded by Commissioner Bishop, to approve the proposed revision to the Water Main Extension Policy. The motion passed unanimously.
STEAM LINE EXTENSION POLICY REVISIONS
Referring to a memorandum included in the meeting agenda packet, Water & Steam Divisions Director Dick Helgeson explained that the current version of the Steam Line Extension Policy was adopted in April, 1985. He said the intent of the policy is to allow for investment by EWEB in facilities to serve new customers, to the extent that this can be done with a timely economic return to the system and its customers. However, the current policy uses vague language to define the method to be used in calculating EWEB's investment allowance.
Mr. Helgeson stated that the current policy states that EWEB will construct a line extension "that produces revenues equal to, or greater than, EWEB's return on investment ratio as determined from EWEB's latest annual report." It further states that "return on investment. . . is determined by dividing sales, less net revenue, by plant in service." Mr. Helgeson said that to the casual observer, this calculation might appear to make conceptual sense; however, in actual application, the current language is functionally unclear and produces a relatively meaningless result.
Mr. Helgeson said the revised policy allows for an investment of up to three times annual revenues, net of variable costs, toward the line extension. Any costs over this amount would be borne by the customer. He said that using the proposed method, steam extension investments will be recovered in three years or less from the margin revenues on sales to the new customer. Mr. Helgeson said this allows EWEB to connect a new customer when practical within the established downtown distribution system without a subsidy by EWEB or other customers.
Commissioner Dyer moved, seconded by Commissioner Bishop, to approve the proposed revisions to the Steam Line Extension Policy. The motion passed unanimously.
EASEMENT FOR ROADS AND UTILITIES FOR THE CITY OF SPRINGFIELD FOR AMBLESIDE SUBDIVISION
Referring to a memorandum included in the meeting agenda packet, Real Property Specialist Mark Oberle reviewed background information and issues relative to the City of Springfield's request for easements for the extension of 33rd and 35th Streets across the Hayden Bridge Utility Corridor.
Mr. Oberle said staff recommends approval of the easement to the City of Springfield. He noted that staff intends to hold the approved easement until the agreed upon changes to the construction drawings are complete.
Commissioner Dyer moved, seconded by Commissioner Bishop, to approve the easement granting across EWEB property at Hayden Bridge. The motion passed unanimously.
The meeting adjourned at 9:30 p.m.