1. Pursuant to ORS 192.660(1)(h) to consult with counsel concerning the legal rights and duties of a public body with regard to current litigation or litigation likely to be filed in relation to the Public Employees Retirement System.

1. Agenda check (President Smith)
2. Approval of Consent Calendar (Items will be approved by one motion and without discussion. If discussion is required, specific items will be removed from the consent Calendar and considered separately.)
3. Items from Board Members (5 min.)
4. Correspondence (5 min.)
5. Public Input
6. 2000 Work Plan and Budget - Dick Varner, Fiscal Services Supervisor (Presentation - 10 min./Discussion - 10 min./Information)
7. Public Hearing on 2000 Budget
8. Adoption of the 2000 Budget and Work Plan (Dick Varner - Recommendation/Discussion - 5 min./Action)
9. Telecommunications Phase II Development - Alternative Procurement Process - Ken Beeson, Telecommunications Project Manager and Ed Case, Purchasing Coordinator (Presentation - 15 min./Discussion - 15 min./Action)
10. Oregon Utilities Resource Council Association (OURCA) designated representatives - Randy Berggren, General Manager (Presentation - 5 min./Discussion - 5 min./Action)
11. EWEB Power Purchases/Post-2001 BPA Products - Scott Spettel, Power Management & Planning Manager and Bert Dunn, Power Resources Analyst (Presentation - 15 min./ Discussion - 10 min./Information)
12. Request for information on Charter Amendments - Jim Origliosso, Treasurer (Presentation - 5 min./Discussion - 10 min./Action)
13. Items removed from Consent Calendar

• Minutes of the November 2, 1999 Work Session and Regular Board Meeting

BUDGET AMENDMENT #9

• Buy-down of PERS Liability: In October 1998 PERS ordered an increase in contribution rate effective July 1, 1999. The increase was substantial, amounting to approximately $1 million over what was proposed in the budget for 1999 and $2 million annually thereafter. EWEB elected to defer most of the increase until the following 2-year rate period which begins July 2001. Our intention was to select the lowest mandatory rate and have the option to buy-down a portion of the liability if reserve funds remained sufficient. If reserve funds were not sufficient and no optional payment were made, the impact on the July 1, 2001 rate attributable to the deferral would be about .75% of payroll higher.

The rationale for making a $3 million payment is that this amount would cover the originally proposed rate increase through the December 31, 2000, hence there would be no budget issue for the upcoming year. By the end of next year, PERS will have released its new rates. The significance of making a lump sum payment at this time is that all payments made prior to December 31, 1999 are included in the actuarial study that goes into making the new rates. Consequently EWEB would receive "credit" in the next rate case for having paid at the higher rate originally ordered by PERS.

Applies to 1999 Budget

Expected Expenditures $8,142,000

1999 Budgeted Amount $5,142,000

Additional Funds needed $3,000,000

Source of Funds: Unbudgeted capital improvement reserves previously set aside from accumulated assets of the Electric Utility and unbudgeted capital improvements reserves of the Water Utility. Staff Contact: Jim Origliosso, Financial Services Director at 344-6311, ext. 3753.

BUDGET AMENDMENT #10

• Power Scheduling. In 1998, the Power Marketing Incentive Plan was implemented for Power Marketing positions in order to better match comparable positions in the job market. The plan was not to budget for incentives, but to cover incentives with the exra revenue that the power marketing activity created. Through 10 months of 1999, power trading activities have netted results that are $2.6 million better than the authorized budget. The amount of incentives that is expected to be paid out in 1999 is $164,000. (Contact person is Scott Spettel, 484-2411, ext. 3404.)

Applies to 1999 Budget

Expected Expenditures $164,000

1999 Budgeted Amount $-0-

Additional Funds needed $164,000

RESOLUTIONS

4. Revolving Line of credit for $8,000,000 and Line of Credit for support of Commercial Paper Program for $6,000,000. Please see the accompanying memo for explanation. (Contact Cathy Bloom, Assistant Treasurer, 484-2411, ext. 3277 if you need more information.)

CONTRACT AWARDS

• Power Technologies Inc. - Electric Operations - Network Protector Training. This service will provide in-depth on-the-job training for our Network Underground Crews. This training is necessary due to loss of a large number of employees to retirements, who had the experience doing this work, as well as a functional shift in job responsibilities from the Relay Shop to the Network Underground Crews. (Contact person is Dave Koski, Electric Operations, 484-2411, ext. 3731.)

Applies to 1999 Budget

Contract Amount - Job #16865 $24,350

• EPRI-CSG. - Electric Generation Maintenance Planning & Electric T&D Maintenance Planning. This contract is for authorization to contract with EPRI-CSG, Inc. for consulting engineering services to complete Reliability-Centered Maintenance studies of the Carmen-Smith/Trailbridge Project as well as two EWEB substations and the downtown secondary network. (Contract person is Marc Anderson, Electrical Engineering, 484-2411, ext. 3255)

Applies to 1999/2000 Budget

Contract Amount $159,644

Item is budgeted under Job #'s 19189

and 19190 (Capital reserves)

• R.W. Beck - Financial Services - Rate Case Consulting. For the past several years, EWEB has contract with RW Beck to provide rate consulting services. We again intend to contract with them for the 2000 Electric and Water rates cases. It would include assisting Fiscal Services with developing new rate classes and cost allocation methodologies using our new load research date, provide an independent quality assurance review of the cost allocation and rate design, and developing reports used in the rate case. Currently there is approximately $23,000 available in the 1999 and 2000 budget to cover this work. In addition, we would use part of the vacancy savings in 1999 from not filling our senior rates analyst opening to cover the remainder. (Contact person is Dick Varner, Fiscal Services, 484-2411, 3299.)

Applies to 1999/2000 Budget

Contract Amount $32,000

(See above where money is budgeted)

AGREEMENT

Water Administration - Water Division. This contract provides for operation of an interconnection between EWEB, SUB, and Rainbow Water to provide mutual assistance and surplus water in the event of a system emergency. The terms of this agreement are essentially the same as those contained in a prior agreement which was implemented on a temporary basis in 1995. A physical intertie between the systems already exists, with a flow capacity of up to 3.0 million gallons per day in either direction. Supply of water is at the sole discretion of the providing party, and deliveries of water may be refused, restricted or suspended at any time. Any water actually supplied would be metered and billed to the receiving party at EWEB's established wholesale rater for water districts. No significant expenditures or budget implications are associated with the execution of this agreement. SUB and Rainbow have requested implementation prior to year-end for purposes of Y2K preparedness. Staff recommends approval as a consent calendar item, authorizing EWEB's General Manager to execute the agreement in substantially similar form to the working draft furnished in the Board packet.