Board Members present: Sandra Bishop, Dorothy Anderson; Peter Bartel, Susie Smith, and Patrick Lanning.
Others present: Randy Berggren, Dick Helgeson, Dick Varner, Jim Wiley, Dave Koski, Mel Damewood, Tom Buckhouse, JoAnn Andersen, Burt Dunn, Roseanna McArthur, Jim Maloney, Eric Hiaasen, Cathy Grey, Mat Northway, Scott Spettel, and Krista Hince of the EWEB staff, Kim Young, Minutes Recorder, and members of the public..
President Bishop called the Regular Board Meeting of the Eugene Water & Electric Board (EWEB) to order.
AGENDA CHECK
President Bishop proposed a change in the order of the published agenda to accommodate members of the public, moving item 7 (Amendment to Hyundai Power Sales Agreement) to item 6, and placing item 6 (2000 Forward Sale) at the end of the agenda as item 10. There was no objection voiced by the Board.
APPROVAL OF CONSENT CALENDAR
Commissioner Bartel moved, seconded by Commissioner Smith, to approve the items on the Consent Calendar. The motion passed unanimously, 5:0.
CORRESPONDENCE
General Manager Randy Berggren briefly noted recent correspondence received by the Board and correspondence drafted on behalf of the Board. He called the commissioners' attention to correspondence sent by Leaburg residents calling for some form of recognition of long-time EWEB employee Lloyd Knox and said that staff was working on an acknowledgment of appreciation. Responding to a question from Vice President Anderson, Mr. Berggren said that he did not contemplate a change in the name of Water Board Park as suggested by some residents, but he anticipated a proposal would be forthcoming soon for a memorial to Mr. Knox. The Board concurred with the direction being taken by staff.
Mr. Berggren called the Board's attention to the annual Major Customer meeting occurring the next day at noon at the Wheeler Pavilion at the Lane County Fairgrounds and encouraged Commissioners to attend if possible.
Mr. Berggren noted the inclusion in the meeting packet of a memorandum from staff person Debra Wright to the Board regarding the establishment of a Telecommunications Citizen Involvement Group, which solicited the Board's recommendation for residential membership. He briefly described the composition of the group. President Bishop asked that Mr. Bartel be involved in the selection on the behalf of the Board. Mr. Berggren concurred.
Mr. Berggren announced that the Northwest Energy Conference would be held in Eugene that week.
Mr. Berggren noted the distribution of a memorandum containing the answers to questions submitted by Commissioner Bartel regarding Weyerhaeuser's Groundwater Mitigation Plan.
Mr. Berggren reviewed the Board's upcoming meeting schedule.
Ms. Smith expressed appreciation for the memorandum regarding follow-up on the topic of citizen contacts to the Board.
ITEMS FROM BOARD MEMBERS
Commissioner Smith indicated she had to leave the meeting at approximately 9 p.m.
Commissioner Bartel reported on a telecommunications conference he had recently attended. He said that the conference indicated to him that EWEB should feel pretty good about where it was at this point in its telecommunications planning.
Commissioner Lanning thanked Marty Douglass and Jay Bozievich for a tour of the City View reservoir site, and for their work with residents living adjacent to the site.
President Bishop referred to the memorandum from Mr. Berggren on the citizens contact approach included in the meeting packet, and said the importance of the process was clear communication and a standard procedure. She said that personally, she found staff to be quite efficient in its responses to her questions and requests to contact constituents.
PUBLIC INPUT
There was no one present wishing to offer public input.
AMENDMENT TO HYUNDAI POWER SALES AGREEMENT
Director of Facilities Services Tom Buckhouse introduced Antone Schmidt, who had represented Hyundai in negotiations between the company and EWEB. Mr. Buckhouse reviewed the background of the initial Power Sales Agreement between Hyundai and EWEB, which provided an opportunity for renegotiation, and the terms of the amendment to the agreement. He called the Board's attention to Exhibit C, attached to the memorandum, which was a spreadsheet entitled Schedule of Electric Rates and Charges (Revised October 2000), and reviewed the information contained in the spreadsheet.
Responding to a question from Commissioner Smith, Mr. Buckhouse confirmed that most of the difference in the cost of the two agreements was between the percentage in effect for conservation at the time of the original contract and the current percentage. The effect would be less money for EWEB to invest in conservation. EWEB would not recoup as much money as was in the COSA. The funding would not be recovered, and the difference would be paid by EWEB from reserves. Commissioner Smith observed that it did not appear that EWEB had a choice in the matter.
Mr. Buckhouse recommended that the Board direct the General Manager to sign the agreement as presented.
Vice President Anderson moved, seconded by Commissioner Lanning, to authorize the General Manager to sign the second amendment to the Power Sales Agreement with Hyundai per the conditions presented in the September 29, 2000, memorandum. The motion passed unanimously, 5:0.
WATER RIGHTS EXTENSION APPLICATION
Dick Helgeson, Director of Water & Steam Divisions, and Clark Balfour, Special Council Attorney provided background information on the State water rights process and its relationship to EWEB's water rights extension filing. Mr. Balfour briefly described recent changes in State processes related to water right extensions and municipalities.
Mr. Helgeson noted that the current budget included funding for assistance to do the work required for the extension application. He clarified that the water rights involved concerned the last remaining water rights at Hayden Bridge not currently allocated. He noted the possibility that the State could take the rights and place them into a "municipal reserve."
Responding to a question from Commissioner Bartel, Mr. Helgeson said that EWEB's water right certificates were in the Property Record Files and on file with the Water Resources Department. Mr. Bartel suggested that, given their importance to the utility, the certificates be displayed rather than being filed. Mr. Helgeson indicated he would investigate to see whether the certificates were suitable for framing.
Mr. Bartel asked if EWEB's exploration of the possible use of ground water would have an impact on its application. Mr. Helgeson said that if EWEB's use of groundwater affected its use of river water it would, but given the lack of evidence of interaction between the river and the groundwater, he thought that would not be an issue. He suggested a mitigation strategy would be that, in lieu of canceling excess rights, EWEB would run well fields to help maintain the flow levels in the river until the rights were needed.
Responding to a question from Commissioner Bartel regarding the nature of the model underlying the application, Mr. Helgeson said that in today's regulatory climate EWEB must show that its water demand forecasts took conservation into account. It was in EWEB's interest to submit information about its water supply program to the State to demonstrate its reliance on conservation to minimize its withdrawals from the river. Commissioner Bartel asked if the use's impact on the environment was an element considered in the application. Mr. Helgeson said yes. Mr. Berggren said that conservation was an important element of the water supply planning process.
Commissioner Smith noted the many conflicting laws the State had attempted to administer through rule making and legislation and the formation of a task force to sort through issues related to fish flows and in-stream habitat. She said there was a difference between evaluating rights that had already been applied for where an allocation analysis had been done and new applications for future rights, and emphasized the conditions that were instituted on existing permits related to conservation plans and diversion construction. Ms. Smith expressed concern that any future legislation designed to open up further water rights would be heavily influenced by interests that did were not very supportive of environmental issues.
Responding to a question from President Bishop, Mr. Balfour described the background leading to the proposed rule changes.
FEES AND CHARGES BALLOT INITIATIVE
Jim Origliosso, Financial Services Division Director, reviewed a memorandum in the meeting packet entitled Impacts of Ballot Measure 93--Taxpayer Initiative (TPI). The memorandum described the proposed constitutional amendment and its impacts on EWEB finances and financial planning.
Win Calkins, EWEB's General Council, provided advice to the board on its limits related to advocacy for or against the ballot initiative, noting that the Board could pass an advisory resolution for the community if it did not direct staff to undertake any activity that could be construed as support or opposition. Responding to a question from Commissioner Smith, Mr. Calkins said that, as the Board's legal counsel, he could not construct a resolution related to the ballot initiative on public time. He said that staff would continue to provide factual information about the initiative to the Board.
Mr. Calkins described the three exemptions included in the initiative and how they would affect EWEB, noting that the exemptions were unclear and would probably require court interpretations.
Commissioner Smith advocated for a Board resolution opposing the ballot initiative. She said the community needed to know how the measure would affect it, and it was a Board responsibility to provide that information.
Commissioner Smith said she had to leave but noted her support for the Forward Power sale coming up in the next agenda item.
Vice President Anderson asked if Commissioner Smith objected to EWEB's involvement in a coalition opposing ballot measures 8 and 91 as well as 93. Commissioner Smith had no strong feelings about the possibility, saying she needed to think more about the pros and cons of that approach.
Ms. Smith left the meeting.
Vice President Anderson distributed information provided by the coalition she had referred to earlier. She said that Eugene would take action the following week on all three measures, and Eugene City Councilor Nancy Nathanson had suggested in an e-mail message that someone appear at a public forum that evening to discuss the issues.
Responding to a question from Commissioner Bartel, although President Bishop agreed that the two measures in question were "a disaster," she did not think it appropriate for the Board to take a position on measures 91 or 8 because of the lack of a direct connection to EWEB.
Indicating that she would e-mail copies of the resolution to the Board for suggestions for further refinement, Vice President Anderson read a proposed draft resolution opposing Ballot Measure 93.
President Bishop supported the resolution, saying the measure would be devastating if it passed and would cost EWEB a small fortune to deal with in court. She endorsed Vice President Anderson's suggestion.
Commissioner Bartel moved, seconded by Ms. Anderson, to adopt a position opposing Ballot Measure 93. The motion passed unanimously, 4:0.
ITEMS REMOVED FROM CONSENT CALENDAR
There were no items removed from the Consent Calendar.
2000 FORWARD SALE
Dick Varner, Fiscal Services Supervisor, and Power Marketing Analyst Bert Dunn provided background on the item. Mr. Varner said EWEB would like a bigger power operating reserve to cover increased hydro and market risk. He reviewed a bar chart comparing the financial impacts of the options available to the Board.
Mr. Varner asked the commissioners to authorize the General Manager to execute a sale or exchange of up to 30 aMW of power in the October 2001 through December 2002 time period with the conditions previously referenced.
Vice President Anderson moved, seconded by Commissioner Bartel, adoption of the 2002 Forward Sale with the conditions as outlined in the memorandum to the Board. The motion passed unanimously, 4:0.
The meeting adjourned at 9:55 p.m.
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Assistant Secretary President