Board Members present: Susie Smith, Mike Dyer, Sandra Bishop, and Dorothy Anderson. Commissioner Bartel was excused.
Others present: Randy Berggren, Tom Buckhouse, Marty Douglass, Garry Kunkel, Roseanna McArthur, Mat Northway, Jim Origliosso, Debra Wright, and Krista Hince of the EWEB staff; member of the public; and Daniel Lindstrom, Minutes Recorder.
President Smith called the Work Session of the Eugene Water & Electric Board (EWEB) to order at 7:15 P.M. She determined there were no requests to alter the published agenda.
ITEMS FROM BOARD MEMBERS
Commissioner Anderson reported that her offer to provide information regarding the breaching of dams to the Board at its May 18 meeting had been filled by the Northwest Energy Coalition. She said the information provided contained less detail than what she had previously received. She indicated that representatives of the coalition had expressed a desire to attend a meeting of the EWEB Board and make a presentation regarding their Columbia and Snake Rivers Campaign in June or July. She said she had responded that agendas of future Board meetings were very full, but that she would ask whether Commissioners wanted such a presentation.
Commissioner Anderson stated that she had become convinced by material she had received from the Northwest Energy Coalition that full information about the issues would not be available until August, at the earliest. She said she had come to favor a suggestion that, in light of state and federal legislative attempts to preclude removal of the Columbia and Snake River dams, the Board should adopt a resolution asking that the option to breach the dams remain on the table, along with all the other options under consideration.
President Smith said she also favored the position stated by Commissioner Anderson. She pointed out that such an option was a "middle ground" and could become the basis for policy regarding EWEB's own dams.
Commissioner Bishop said that she did not believe consideration of the issue was a profitable use of Board agenda time because EWEB dam re-licensing issues were not yet settled. She recalled that EWEB attorneys had advised the Board to not take positions on such concerns until legal considerations were resolved. She recommended that consideration of an EWEB position on dam breaching issues be postponed.
Commissioner Dyer said he could not support breaching dams as long as EWEB operated dams, but that he believed it was acceptable to study the issues involved and, therefore, would not mind the option of a resolution to study all the options.
General Manager Randy Berggren said he was hearing the Board express a desire to postpone receiving a presentation from the Northwest Energy Coalition or considering a position on the breaching of Columbia or Snake river dams; but, at the same time, that they were interested in stating that it believed all options should remain "on the table." He suggested that staff return to the Board with a draft resolution at the June 15 Board meeting.
President Smith determined there was consensus agreeing with the approach of Mr. Berggren.
Commissioner Bishop reported that the State Legislature had proposed to form a new agency, the Oregon Watershed Enhancement Board, which would be responsible for dispensing lottery funds to voluntary efforts related to parks and salmon restoration.
APPROVAL OF MINUTES
President Smith requested that sentence 1 of paragraph 5 on page 3 of the minutes of the April 23-24 meeting be changed, as follows:
President Smith asked if a plan had been developed to phase out
the steam utility, in light of its reducing
viability potential future load
losses.
President Smith determined there was no objection to her request and stated the minutes were amended.
Commissioner Bishop requested that sentence 1 of paragraph 7 on page 3 of the minutes of the April 23-24 meeting be changed, as follows:
Commissioner Bishop said she believed EWEB had an obligation to
serve its existing steam customers for at least the next
three to five years.
President Smith determined there was no objection to the request of Commissioner Bishop and stated the minutes were amended.
Commissioner Dyer moved, seconded by Commissioner Bishop, that the minutes of the April 23-24, 1999, Board Planning Session be approved, as amended. The motion was adopted unanimously, 4:0.
President Smith requested that paragraph 3 on page 1 of the minutes of the May 18 Work Session be changed, as follows:
Vice President Smith
Dyer called the Work Session of the Eugene
Water & Electric Board (EWEB) to order at 5:35 p.m.
President Smith determined there was no objection to her request and stated that the minutes were amended.
Commissioner Dyer moved, seconded by Commissioner Anderson, that the minutes of the May 18, 1999, Work Session be approved, as amended; and that the minutes of the May 18, 1999, Special Board Meeting be approved, as submitted. The motion was adopted, 3:0:1, with Commissioner Bishop abstaining from voting.
CORRESPONDENCE
Mr. Berggren stated that the joint meeting of the Board and the Eugene City Council had been rescheduled and was back on for June 9. He referred to a memorandum of Public Affairs Manager Marty Douglass about the joint meeting distributed with the agenda of the meeting.
Mr. Berggren reported that the June 18-19 and July 9 & 10 Board Planning Sessions would be held at the Eugene Hilton Hotel.
Mr. Berggren determined that Commissioners Bartel, Bishop, and Anderson would be attending the dedication of the Wyoming Wing Project on July 15-16.
Mr. Berggren announced that EWEB had begun to accept charge card payments of utility bills. Treasurer Jim Origliosso reported that 65 customers had taken advantage of the opportunity in the first four business days of its availability, making $11,000 in payments.
Mr. Berggren reviewed the agenda of the June 15 Work Session and Special Meeting summarized in a document distributed at the beginning of the meeting. He said discussion of issues related to breaching Snake River dams would be added to the agenda.
PUBLIC INPUT
President Smith determined that there was no member of the public present who wished to address the Board.
OREGON UTILITY RESOURCE COORDINATION ASSOCIATION
Power Planning and Analysis Manager Scott Spettel referred to his memorandum regarding adoption of an ordinance approving EWEB participation in the Oregon Utility Resource Coordination Association Inter-Governmental Agency (OURCA IGA). He noted that the proposed ordinance was attached to the memorandum.
Commissioner Dyer moved, seconded by Commissioner Anderson, that the second reading of the ordinance approving the participation of EWEB in the OURCA IGA be completed by title only. The motion was adopted unanimously, 4:0.
Mr. Spettel read the ordinance by title, "Authorizing An Intergovernmental Agreement Creating The Oregon Utility Resource Coordination Association Inter-Governmental Agency."
Commissioner Dyer moved, seconded by Commissioner Anderson, that the ordinance approving the participation of EWEB in the OURCA IGA be adopted. The motion was approved unanimously, 4:0.
Mr. Berggren reported he had discussed with Commissioner Bartel EWEB's representation on the governing body of the OURCA IGA. He said bylaws establishing such representation had not yet been created, but that he believed the activities of the body would be so significantly technical and depend on relationships established in the formation of the agency that he would recommend that the General Manager represent EWEB. He said the issue of appointing the EWEB representative would be on the agenda of a July Board meeting.
President Smith said she agreed with the reasoning of Mr. Berggren, but was concerned that the OURCA IGA could commit EWEB resources now reserved to the authority of the Board. Mr. Berggren replied that policy had been established which did not permit such commitment of agency partner resources.
Commissioner Bishop said she agreed that a technically knowledgeable person should represent EWEB in the OURCA IGA because of the "element of risk" involved in the venture.
CONTRACT REVIEW BOARD POLICY
Facilities Services Director Tom Buckhouse referred to his memorandum regarding purchasing and contracting rules. He noted that Section 020 of the EWEB Purchasing Procedure policy was attached and that it incorporated changes proposed by Commissioners on May 18, as follows:
Mr. Buckhouse distributed copies of a document entitled "Contracts Analysis Data Summary." He reviewed the information contained in the document - five public improvement contracts over $100,000 were awarded in the past 12 months; 10 material and equipment contracts over $100,000 were awarded; and 44 personal services contracts over $20,000 were awarded.
Mr. Buckhouse suggested that Board approval of personal services contracts might become burdensome, but that the number was being reduced by a recent change to the use of three-year contracts with cancellation clauses. He said contracts were also no longer being required for services costing less than $5,000.
President Smith said she did not feel the number of contracts involved would become overly burdensome for the Board. She expressed concern that extending the length of contracts from one- to three-years could eliminate opportunities for competitive solicitation of services. Risk Manager Debra Wright replied that she believed EWEB used the services of a wide variety of providers and was always seeking competitive price reductions.
After expressing agreement that additional Board accountability for contracting was warranted, Commissioner Anderson said she was concerned that the work of the Board could become "bogged down" having to approve personal services contracts.
President Smith said she believed it was important to provide for public accountability in EWEB's contracting policies. She suggested that purchasing policies should more clearly identify what authority was retained by the Board, in addition to what was delegated to the General Manager.
Commissioner Bishop said she did not fully understand the intention of the proposed procedural changes. President Smith replied that their purpose was to place a higher level of accountability for EWEB contracts with the Board.
Commissioner Bishop said she did not want to add a large commitment of Board members' time to the consideration of contracts. President Smith replied that contract approval could be accomplished through a Consent Calendar mechanism.
President Smith said she was concerned with designation of the General Manager to determine if exemption from purchasing and contracting bidding was appropriate, as stated in Purchasing Rule 020.2.4. Mr. Buckhouse pointed out that Purchasing Rule 020.10 identified specific circumstances in which contracts would not be based on competitive bids. Mr. Berggren suggested that it might be appropriate to add reference to Rule 020.10 in Rule 020.2.4
President Smith said she believed competitive bids for over $5,000 identified in Purchasing Rule 020.4 should be required to be in writing and that for bids of $2,500 to $5,000 phone quotes be required..
President Smith suggested that the statement relating to change orders exceeding 20 percent of the original awarded amount proposed to be added to Purchasing Rules 020.4, 020.5, and 020.6 be changed, as follows:
The Board shall approve all
authorize change orders which cause the
contract to exceed 20 percent of the original awarded amount or which
cause the contract to exceed the $100,000 threshold.
President Smith proposed that Purchasing Rule 020.6 codify that "competitive solicitation" be required on a regular basis for personal service contracts over $20,000. Mr. Buckhouse said that, if such a requirement were added, it would be helpful if the General Manager was given authority to provide for its waiver under certain circumstances.
President Smith requested that EWEB Purchasing Procedure Section 020 be brought back to the Board for final approval before it was incorporated into practice.
Commissioner Bishop said she was concerned that Board involvement in development of Purchasing Procedure details might move it beyond its role of setting overall policy. She suggested that Board accountability was in place and that she believed the problem was a communication breakdown which had surfaced during the remodeling of the Midgley's Building. She also suggested that the problem might have led to some over-reaction on the part of the Board. She proposed that changes to Purchasing Procedures be revisited in six months to a year.
Mr. Berggren stated that staff was seeking to develop a Consent Calendar methodology for inclusion in the agenda of Board meetings. Director of Corporate Services Roseanna McArthur said several sample procedures were available, but that other suggestions would be welcome.
Mr. Buckhouse said he hoped Consent Calendar procedures would allow staff to provide Commissioners with background for items to be considered. President Smith said she would prefer to have information about such items limited to a single page.
Mr. Berggren reported that Commissioner Bartel had expressed a desire to have meeting background information available earlier than it currently was. Commissioner Bishop said she did not believe Commissioners should review details of contracts to be approved under new procedures, and that earlier delivery of meeting material was not necessary.
Mr. Berggren stated that final review of issues related to contract review policies would be on the agenda of the June 15 meeting and that changes would be implemented on July 1.
WILLAMETTE WATER COMPANY CONTRACT EXTENSION
Water Division Director Dick Helgeson reviewed background information regarding extension of the Willamette Water Company contract provided in his memorandum distributed with the agenda of the meeting. He pointed out that staff recommended approval of a three-year contract extension, as attached to the memorandum.
Commissioner Anderson said she recalled that there had previously been concern about swimming pools at the homes of Willamette Water Company customers and asked if curtailment of their use was possible in the new contract. Mr. Helgeson replied that the contract provided that EWEB could terminate water service for specific reasons and that the company was required to comply with rules established in the event of a water shortage.
Commissioner Dyer moved, seconded by Commissioner Bishop, that an addendum to the agreement for supplying water to the Willamette Water Company providing for renewal of the agreement until August 24, 2002, be approved. The motion was adopted unanimously, 4:0.
GENERAL MANAGER'S GOALS UPDATE
Mr. Berggren referred to a document entitled "1999 Board Goal Themes and 1999 Goals for the General Manager" distributed with the agenda of the meeting. He said it was the first of a series of quarterly status review reports he would make to the Board. He asked if the format of the report was clear and appropriate.
President Smith said she believed the format and content of the report was good.
Commissioner Bishop said she believed the report provided "almost too much" detail.
Commissioner Dyer said the comment "Improve all aspects of customer service" attributed to him on page six of the report was not intended to imply that he believed EWEB was doing a poor job in serving its customers. He said he believed the comment was originally made to encourage improvement of EWEB's relationship with developers.
PUBLIC EMPLOYEES RETIREMENT SYSTEM
Mr. Origliosso referred to his memorandum regarding EWEB's Public Employees Retirement System (PERS) contribution rate distributed with the agenda of the meeting. He said he would appreciate Board feedback on the action plan proposed in it to deal with the rate increase.
Mr. Origliosso provided an update on issues related to the PERS contribution rate. He said principles for dealing with the matter had developed, as follows:
Mr. Origliosso reviewed public information activities regarding the PERS issue in which EWEB had engaged. He also reviewed PERS-related activities of the 1999 Oregon Legislative Session and the legal strategy to be pursued in challenging the rates.
Mr. Origliosso stated that staff proposed to adopt a PERS rate payment schedule, as follows:
Mr. Origliosso said that the schedule would correspond with assumptions made in the 1999 budget and mitigate rate increase pressures in 2000. He said the option would allow a lump-sum pay down of the unfunded PERS liability with accumulated assets or additional debt, as determined later. He also said the option allowed time for adjustment in other costs, retaining EWEB's financial flexibility. He said the option retained the "high ground" with PERS and stakeholder groups.
Mr. Berggren stated that EWEB would need to inform PERS of the payment option it had chosen by June 15.
The meeting adjourned at 9:15 p.m.
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Assistant Secretary President