Board Members Present: Dorothy Anderson, Patrick Lanning, Sandra Bishop, and Ron Farmer. Commissioner Paul Conte was excused.
Others present: Randy Berggren, Dick Varner, Andrea Mason, Will Bondioli, Eric Hiaasen, Jim Wiley, Roseanna McArthur, Tom Buckhouse, Jim Origliosso, Dick Helgeson, Scott Spettel, Cathy Bloom, Stephen West, Chuck Bodine, Jill Hoyenga, Lance Robertson, and Krista Hince of the EWEB staff; and Kimberly Young, City of Eugene Minutes Recorder.
AGENDA CHECK
President Dorothy Anderson called the Special Board Meeting to order. She noted that Commissioner Conte was unable to attend the meeting because of a family illness and was excused. She accepted a suggestion from General Manager Randy Berggren to postpone Agenda Item 10, Standard Market Design - NOPR, to a future meeting.
Commissioner Bishop asked that item 9, Electronic Media Policy, be moved to become Agenda Item 6. There was no objection.
APPROVAL OF CONSENT CALENDAR
President Anderson pulled the Work Session minutes of September 3, 2002.
Commissioner Bishop pulled item 3, Personnel Solutions - EMS Office Management - Energy Management Services - Customer Services - $7,500.
Commissioner Bishop, seconded by Vice President Lanning, moved to accept the Consent Calendar with the exception of Consent Calendar Item 3 and the Work Session Minutes of September 3, 2002. The motion passed unanimously, 4:0.
ITEMS FROM BOARD MEMBERS
Commissioner Bishop said she continued to receive calls from McKenzie corridor residents that the canal had been drained but not cleaned. She said that Jim Wiley, Director of Electric Division, assured her that it would be addressed.
Commissioner Bishop requested a corrected Board contact sheet, noting incorrect information about dates of service and the inconsistency of the formatting and information provided for each Commissioner. In addition, she noted that she had not been appointed to the Board. She suggested that information about what Commissioners did or where they worked was not needed, but rather their name, address, and contact information. General Manager Randy Berggren agreed to return with a sample format for the Board to review. Assistant Secretary Krista Hince recommended that Commissioner Bishop review the information provided to her in the Board Manual to determine if that met her needs.
Vice President Lanning commended the staff for the work it did on the Major Customer reception.
Vice President Lanning expressed appreciation for the memorandum from Jay L'Estrange regarding the Leaburg and Walterville power canals, which helped him communicate more effectively about why the project was being done. He said that it appeared there were remaining trees but they were not marketable; he did not think the letter addressed that issue and he wanted to be able to address that issue when asked. General Manager Randy Berggren said he would follow-up. President Anderson asked that the memorandum be sent to the partners on the McKenzie Watershed Council and suggested it might be appropriate to send to River Reflections.
CORRESPONDENCE
Mr. Berggren expressed appreciation that all Commissioners had been able to attend the Major Customer Reception. He reminded the Board of two upcoming Special Board Meetings on October 17 and October 22. Mr. Berggren previewed the agenda of the November 5 meeting.
Mr. Berggren called attention to a flier included in the packets regarding the Sustainable Business Symposium at the University of Oregon on November 7-10. He indicated that EWEB was a sponsor of the event.
Mr. Berggren noted the distribution of a background memorandum on the recent Public Utilities Commission (PUC) system-wide citation. He said that staff had followed up with some clarifying questions and would soon be sending more information to the Board.
Mr. Berggren reported on feedback received at the recent home show, noting there was generally good customer good receptivity and interest in what EWEB was doing, without much negative feedback on rates.
PUBLIC INPUT
President Anderson called for public input. There being none, she moved on to the next item.
ELECTRONIC MEDIA POLICY
Lance Robertson, External Communications Coordinator, was present for the item. He said that several Commissioners had expressed interest in knowing more about the Oregon Public Records and Meetings law as they applied to the use of e-mail. He noted that Eric DeFreest, General Council, and Ed Case, Risk/Purchasing Manager, were also present for the item.
Mr. Case briefly reviewed the memorandum on the subject provided to the Board, noting that the issue was generally governed by the Oregon Revised Statutes 192, the Public Records and Meetings law. He recommended that the Board avoid any electronic forums that could inadvertently constitute deliberations toward a decision. He offered staff technical assistance and copies of the law.
Mr. DeFreest noted the confidential attorney-client memorandum issued by his office to the Board responding to questions, and offered to follow-up on any issues of concern to the Board. He cautioned the Board against discussing the memorandum in open session.
President Anderson observed that it was unfortunate Commissioner Conte was not present because of his interest in pre-preparation for meetings and the questions he had about the topic. She expressed appreciation for the memorandum, noting that it clarified that she needed to consistently copy her messages to Ms. Hince as well as Mr. Berggren.
Commissioner Farmer noted that all his questions revolved around points that Mr. DeFreest made in his memorandum. Mr. Berggren offered to schedule an Executive Session for further discussion.
Commissioner Bishop said that staff did a very good job in meeting the State public meeting requirements. However, she was concerned about the use of e-mail because the Board lacked a policy or standards for e-mail; for example, she thought there was a way to configure a computer so that messages were automatically saved. However, if the Board received a public information request and Commissioners had to produce their e-mail messages, it "would be an incredible hassle" for most Commissioners. At this point, she thought there was no accountability, and was disappointed to see a staff recommendation that the issue be addressed on a case-by-case basis.
Commissioner Farmer said he would like to know why legal counsel made the recommendation, but noted the complications created by the confidential nature of the memorandum.
Commissioner Farmer, seconded by Vice President Lanning, moved to schedule an Executive Session on the item.
Commissioner Farmer asked Mr. DeFreest if he was violating the law if he received a background memorandum from staff via e-mail, responded with questions, and copied other Commissioners. Mr. DeFreest said potentially; there was no clean rule as to such communications and when they become subject to the law. In Commissioner Farmer's example, it could be considered a violation if the issue addressed something on an upcoming agenda and any substantive issue was addressed.
President Anderson recalled the origin of the agenda item in an e-mail message from Commissioner Farmer to staff requesting information about retiree benefits and questioned what was wrong with that. Mr. DeFreest said that nothing was wrong with a Commission requesting information in that form. That was static information given each Board member. In response to a follow-up question from Commissioner Farmer, Mr. DeFreest distinguished that from the previous example by pointing out that the questions asked by Commissioner Farmer was interactive. Once a Commissioner began to ask questions, that was okay, as long as only one Commissioner was involved. Once the message was copied to other Commissioners, it became interactive. He emphasized that there was no "fine line" but it was a concern.
Commissioner Bishop emphasized that all information was public.
The motion passed unanimously, 4:0.
President Anderson asked Ms. Hince to consider the issues that had been raised and to provide input. Mr. Berggren noted that he forwarded all board e-mails to Ms. Hince so that she was able to develop a reasonably complete archive of Board communications. He suggested that the Board have a more formal policy discussion of the issues raised by Commissioner Bishop so that it created a more standard procedure for capturing Board communications in the public record. Mr. Berggren indicated he would schedule an Executive Session as soon as possible.
President Anderson moved the Board onto the next item.
BOARD'S ROLE IN ANNUAL AUDIT
Cathy Bloom, Assistant Treasurer, joined the Board for the item. She introduced Senior Partner Don Irving and Senior Associate Matt Whipple from PriceWaterhouseCoopers, EWEB's audit consultant, and Leslie Monks of EWEB's Accounting Department, who managed the audit.
Mr. Irving and Mr. Whipple highlighted recent changes in the auditing profession and resulting changes in the Board's relationship to the audit. Members were provided with a copy of the presentation.
President Anderson reviewed the audit steps with the auditors and noted the earlier point at which the Board was involved. Ms. Bloom confirmed those steps.
Responding to a question from Commissioner Farmer, Mr. Whipple confirmed that his company looked at the quarterly reports, but more for the purpose of planning the year-end audit. Commissioner Farmer asked if the discussions the consultants had with the Board would be reflected in the footnotes. Mr. Irving suggested perhaps those discussions would be reflected indirectly in the footnotes; to the extent information was sensitive and could involve a range of possibilities, that would not be included in the footnotes.
Responding to a question from Commissioner Farmer about what would occur if the auditors found fraud, Mr. Irving deferred to legal counsel regarding whether an Executive Session would be required, but emphasized that his company would have an absolute legal obligation to discuss that with the Board.
Commissioner Bishop asked if the FEMA audit represented a significant amount of work and if it was covered by EWEB's existing contract with the consultant. Mr. Irving responded that the consultants would present a budget to EWEB for the incremental element of the product, although much was already covered, and the single audit of FEMA's report required some additional effort because it was a detailed evaluation of controls and procedures in a checklist format. He said that because of the background his company had, the effort was not too significant.
Mr. Irving briefly over-viewed the other materials provided to the Board and offered to review them in more detail if desired.
Ms. Bloom solicited areas of concern to the Board.
Commissioner Bishop expressed appreciation for the work done by the consultant, and indicated her areas of concern were the same as those brought forth in the materials before the Board.
Commissioner Farmer suggested that the board annually do a "gut check" to determine how it was measuring against the standards. President Anderson and Vice President Lanning agreed.
Responding to a question from Vice President Lanning regarding the reference to succession planning, Mr. Berggren said that EWEB previously referred to it as "bench strength." Mr. Irving said that often referred to leadership succession as well.
Responding to a question from Vice President Lanning about the timing of the review discussed by Commissioner Farmer, Mr. Irving recommended that it be done at the same time each year. It did not depend on the timing of the audit. Vice President Lanning observed that the report mentioned strategic issues discussed by the previous Boards that had not yet been implemented, and advocated for addressing those issues in a mindful way. He advocated for Mr. Berggren to return with a plan to address those issues. Commissioner Bishop advised that the effort be postponed until a the Board could hold a weekend retreat sometime early in the next year.
Commissioners thanked the consultants and staff for the information provided.
WATER CONSERVATION STATUS
Mr. West, Water Management Services Engineering Supervisor, provided a PowerPoint presentation on the status of water conservation programs to the Board. He introduced members of the Water Management Services Team Chuck Bodine and Jill Hoyenga.
Mr. West provided background on the subject, noting the origin of the program in past planning initiatives, culminating in the 1998 Water Supply Plan. He emphasized the citizen involvement associated with those initiatives and the values citizens expressed around conservation before the development of new water resources.
Mr. West highlighted the program emphasis on reducing peak hour demand for water and noted the associated measures of success.
Mr. Bodine discussed commercial and industrial water conservation efforts.
Ms. Hoyenga provided an overview of residential conservation programs.
Board members thanked the team for the presentation.
STEAM FUELS CHARGE
Mr. Varner, Fiscal Services Supervisor, Will Bondioli, Steam Supervisor, and Eric Hiaasen, Power Management Planning Analyst, were present for the item.
Staff presented information on the projected results for 2002 and for fuel prices for 2003. Mr. Hiaasen talked about the relationship of natural gas cost to the Steam Utility and value of surplus power to the Electric Utility and how these two positions naturally hedged each other. Rather than both utilities buying external hedges, EWEB had agreed internally to hedge the two positions against each other. In doing so, it appears that the current fuels charge will recover expected fuel costs for 2003 so staff is recommending no change in Steam rates.
STANDARD MARKET DESIGN - NOPR
This item was postponed.
ITEMS REMOVED FROM CONSENT CALENDAR
President Anderson offered corrections to the Work Session minutes of September 3, 2002.
President Anderson adjourned the meeting at 9:44 p.m.
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Assistant Secretary President