Board Members Present: Dorothy Anderson, Patrick Lanning, Paul Conte, and Ron Farmer. Commissioner Sandra Bishop was excused.
Others present: Randy Berggren, Dick Varner, Scott Spettel, Dawne Howard, Lance Robertson, Brad Akers, Mark Freeman, Marty Douglass, Jim Origliosso, Debra Smith, Dick Helgeson, JoAnn Anderson, and Krista Hince of the EWEB staff, and Ruth Atcherson, minutes recorder of the City of Eugene.
President Anderson called the Regular Board Meeting to order at 7:38 p.m.
AGENDA CHECK
General Manager Randy Berggren requested that a discussion of the medical benefits program be added to the agenda. President Anderson agreed, conditional to time constraints. Mr. Berggren said that it would be an informational item and no action would be requested at this time.
APPROVAL OF CONSENT CALENDAR
Minutes
1. Minutes of the May 20, 2002, Work Session and the Special Board Meeting held on June 18, 2002.
BUSINESS SERVICE AGREEMENTS
2. Profession Service Industries (PSI) - Hayden Bridge Expansion Project - Water Division - $21,668
3. Goebel Engineering and Surveying, Inc. - Laurel Hill Reservoir Property Acquisition - Water Division - $16,000
President Anderson pulled the minutes from the Special Board Meeting held on June 18, 2002.
Vice President Lanning moved, with a second from Commissioner Farmer, to approve the consent calendar with the aforementioned exception. The motion carried unanimously.
ITEMS FROM BOARD MEMBERS
Commissioner Farmer stated that he would like to create a policy or position paper to clarify whether there are violations of the open meeting laws in e-mail communications. Commissioner Conte suggested that the legality of the entire category of electronic communications as it relates to open meeting laws be explored. Mr. Berggren agreed to follow up on this.
Commissioner Conte reported that he and Commissioner Farmer and President Anderson had attended the All Utility Meeting. He noted that Congressman DeFazio had spoken about the standard market design proposal by FERC and had said that it would end public ownership of utilities as it is currently understood. Mr. Berggren responded that this would be discussed at the meeting to be held on October 1. Scott Spettel, Power Management and Planning Manager, added that a motion is being drafted for an extension into January of 2003.
Vice President Lanning thanked the staff for the terrific job that they had done at the Lane County Fair.
President Anderson related that difficulty experienced by a customer who was looking into installing a second meter to possibly reduce her power bill had been abated by good work done by staff. She stated that staff had analyzed the situation for the customer and helped her ascertain what her best course of action was.
President Anderson reported that she and Commissioner Farmer had toured the hydroelectric projects in Walterville, Leaburg, and Carmen Smith. She said that it had been interesting to see how the projects were being brought up to FERC standards.
CORRESPONDENCE
Mr. Berggren related the following items:
PUBLIC INPUT
John Duke, Walterville, said that the residents of Walterville who are experiencing water difficulties are unhappy. He indicated that the tank of potable water that EWEB has provided was a dissatisfactory solution. He suggested that the utility could provide some compensation for those residents that have been inconvenienced by the de-watering of the canal. He felt that EWEB was responsible for the loss of the water and should take action to remedy the situation.
Max Liebreich, Sunset Drive, said that the issue of power lines traversing his property against his wishes has not been satisfactorily addressed to his knowledge. He asked if the General Manager had looked into the issue. Mr. Berggren responded that he had looked into it and had provided some background information to the Board. He said that several options have been offered to Mr. Liebreich and that a workable solution had not been reached at this point. Mr. Liebreich stressed that he was unwilling to pay for any lines that would go to his neighbor's house. He noted that this had been going on for a couple of years. Mr. Berggren agreed to schedule a meeting with Mr. Liebreich
Willard Gowing, 2960 Chestnut Street, proposed that a picnic facility be built in close proximity to the parking lot at the Lloyd Knox Water Board Park. He shared drawings that he had made of his proposal. He suggested that the new structure could be dedicated to long-time EWEB employee, Buck Carter, who had just recently passed away. Vice President Lanning thanked him for his proposal and the work he had done to create it. Mr. Berggren stated that he would look at the proposal.
MISCELLANEOUS FEES AND CHARGES
Dick Varner, Fiscal Services Supervisor, provided the background information on this issue with the aid of overhead projections. He directed the Board to look over the attachment entitled Miscellaneous Fees and Charges as he gave his presentation. He noted that miscellaneous fees are reviewed every few years and that this year's review resulted in suggestions for several changes.
Mark Freeman, Customer Services Supervisor/Field Services & Cash Collections, explained the recommendation for an increase in same-day or after-hour activity. He said that charging $75 for same-day connection would address the inequity between the current charge for reconnection at $40 and the actual cost for it which is $120.
Commissioner Conte wondered why the cost did not more accurately reflect the actual cost to EWEB. Mr. Varner explained that frequently two or three of these calls are made at the same time and that, as such, $75 is a reasonable charge for this service. Mr. Freeman added that the Emerald Public Utility District (EPUD) does not offer the service, Lane Electric Cooperative charges $100, and the Springfield Utility Board (SUB) charges $90.
In response to a question from Commissioner Farmer, Mr. Varner explained that the estimated costs are based on two hours of double time. Mr. Freeman added that the costs are somewhat "hard" and include the cost of benefits.
Brad Akers, Meter Reading Supervisor, discussed the meter reading access issue and some of the difficulties access to meters sometimes presents. He noted that this has been somewhat complicated by the tiered rates. He said that the proposed fee is intended to modify behavior in that the customer can get the fee back if he or she makes a good faith effort to make the meter more accessible. He briefly discussed remote meter reading equipment, which would allow meter reading for a household with an aggressive dog, for instance. He explained that the $60 charge is a one-time installation fee.
Commissioner Conte asked what the turnover was for the customer deposit monies. Mr. Freeman responded that, for residential customers, this turnover happens in two years for most customers and some do not make the credit requirements within that time period. He added that the age of the deposits spans a large spectrum.
Commissioner Farmer asked, regarding commercial accounts, how often the variable rate changes. Mr. Varner stated that it currently can change monthly. Commissioner Farmer recommended adjusting the interest biannually or quarterly.
In response to a question from Vice President Lanning, Mr. Freeman stated that 60 to 90 days lead time is needed to provide customers information regarding the changes.
Commissioner Farmer moved, with a second from Commissioner Conte, to accept the recommended changes to the miscellaneous fees and charges as of October 1, 2002, and for deposits collected, the adjustment interest is to be done biannually, effective January 1, 2003.
Commissioner Conte moved to amend the motion to incorporate an $85 field charge for a disconnect fee. Commissioner Farmer provided a second. The amendment to the motion carried unanimously.
The original motion was voted upon as amended and was unanimously approved.
BONNEVILLE RATE UPDATE
Mr. Varner stated that the real issue is what lies in the future for BPA rate adjustments. He noted that the BPA is projecting a potential problem amounting to nearly $1 billion. He employed overhead projections of the attachment circulated to Board members entitled BPA Power Rates.
Mr. Varner said that a Load-Based Cost Rate Adjustment Clause (CRAC) represents the cost of power that the BPA needed to buy to meet firm loads. He explained that this adjusts every six months.
Mr. Varner related that the slice true-ups are contracts in which the utility pays a percentage share of the cost and in return get a percentage of their output. He said that they determine whether the BPA owes money to the utility or the utility owes money to the BPA. He noted that occasionally it is decided that the BPA owes a little money to the utility but, more often, the BPA sends EWEB a bill. He anticipated a bill of approximately $3 million at the time of the next true-up.
Continuing, Mr. Varner explained Safety Net Cost CRAC (CRAC) which the BPA can increase rates however much it needs to in order to meet its treasury payments.
In response to a question from Commissioner Farmer, Mr. Varner said that the contracts begin to ramp down in the fall, thus the drop in the Load Based CRAC.
Mr. Varner discussed the BPA proposals to counteract rate fluctuations. He explained that the proposal to push the problem into the future is a gamble on the possibility that the rates will stabilize in the future.
Mr. Spettel discussed proposed policy objectives to pass on to the BPA. He asked for feedback as to how much time and effort the Board thought staff should spend on this.
Commissioner Farmer felt that the need for cuts in administrative costs should be stressed when these policy objectives are passed on to the BPA.
Vice President Lanning supported the points raised in the letter and that it should be sent to the BPA.
Commissioner Conte expressed some reservations regarding the policy objectives. Mr. Spettel said that it is possible to qualify the utility's support of the actions taken by the BPA.
Mr. Spettel requested that comments be submitted prior to September 30.
DEPOSIT POLICY REVIEW
Mr. Freeman provided an overview of the memorandum regarding Deposit Policy. He outlined the changes to the deposit policy that staff were recommending.
In response to a question from President Anderson, Dawne Howard, Customer Services Supervisor, clarified that there is a review process for the amount charged in a deposit when ownership or tenancy of a building shifts from one business to the next as the new resident may use more or less energy and the bill is based on power usage.
Commissioner Conte asked what the annual cost would be if all commercial entities chose the one percent option. Mr. Freeman responded that it would cost $1600.
Ms. Howard clarified for Commissioner Farmer that there was no deductible allowed for the credit insurance.
Commissioner Farmer felt that customers would be willing to buy the credit insurance rather than pay the higher amount of the deposit.
Commissioner Farmer commented that it did not make sense to allow two final notices in a year and still refund the deposit if the time is up. He felt that making commercial entities wait ten years for their refund seemed long. He said that, in his banking work, he has seen more businesses close in the first five years. He suggested that once a company reached the five-year mark it was likely to last longer. He advocated for being "in sync" with other utilities in the Pacific Northwest and having shorter deposit periods.
President Anderson asked if Mr. Freeman and Ms. Howard were going to further research the deposit policy. They agreed to do so. Vice President Lanning asked for a broader view of residential deposits, including deposits taken in the State of Washington.
Ms. Howard asked if the Board wanted staff to look more into credit insurance. There was uniform agreement among the Board members that staff should do so.
RETIREMENT MEDICAL BENEFITS PROGRAM
Commissioner Conte suggested that this agenda item be deferred. Nonetheless, he stressed the importance of moving on this issue in an expedient fashion.
Commissioner Farmer asked if caps to the benefits were being looked into. Mr. Wiley said that four options are being looked into and that a pretty good idea of what the unfunded annual liability (UAL) was being ascertained. He stated that staff is still looking at five tiers of employees, but that it is known now that if tier four employees were eliminated and added to tier three there would be a UAL of $1.2 million.
Mr. Wiley stressed the importance of making a decision on this issue by October 15, 2002, to allow for time to implement the decision.
Mr. Berggren recommended that another meeting be scheduled for budget planning. Krista Hince, Assistant Secretary, suggested that October 19, 21, or 22 would be a good date for this meeting.
Jim Wiley, Electric Division Director, announced that Laurie Muggy had a baby boy on Sunday, September 1.
CONSENT CALENDER
President Anderson made the following correction to the minutes from the meeting held on June 18, 2002:
Vice President Lanning offered the following correction:
Mr. Berggren offered the following corrections:
Commissioner Farmer moved, with a second from Vice President Lanning, to approve the minutes from the meeting of the Eugene Water and Electric Board held on June 18, 2002, as amended. The motion carried unanimously.
The meeting adjourned at 9:55 p.m.
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Assistant Secretary President