Pursuant to ORS 192.660(1)(d) to conduct deliberations with persons designated by the governing body to carry on labor negotiations - Randy Berggren, General Manager (30 min.)

Agenda Check (President Lanning)
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.)
Items from Board Members (5 min.)
Correspondence (5 min.)
Board Agendas (10 min.)
Public Input
Election of Officers for 2004 (15 min./Action)
Appointment of Commissioners to Board Liaison Assignments and Committees (15 min./Action)
Commissioners' Priority Issues for 2004 - Board of Commissioners/Randy Berggren (Presentation - 15 min./Discussion 45 min./Information)
Items removed from Consent Calendar

RATIFICATION OF BOARD CONSULTANTS

Ratification of Board Consultants for 2004

a.. General Counsel - Calkins & Calkins
b. Independent Auditor - PricewaterhouseCoopers LLP
c. Independent Engineer - Black & Veatch
d. Consulting Engineer - Black & Veatch
e. Certified Public Account - PricewaterhouseCoopers LLP
f. Special Counsel - Cable Huston Benedict Haagensen & Lloyd LLP
g. Bond Counsel - Nixon Peabody
h. Financial Consultant - Seattle Northwest
i. Consulting Actuaries - Clark/Bardes Consulting

MINUTES



November 18, 2003 Work Session and Special Board Meeting, and the December 2, 2003 Special Board Meeting, and the December 16, 2003 Executive Session

BUSINESS SERVICE AGREEMENTS



Cornforth Consultants - 2003 Carmen-Smith FERC Part 12, Inspection and Safety Report - Electric Division. The existing contract with Cornforth Consultants, Inc. (CCI) needs to be amended to include additional work scope and a contract time extension. The proposed amendment would increase the value of the contract by $94,501 and change the contract not-to-exceed amount to $139,825. Board approval of the proposed contract amendment with CCI is requested to complete the required scope of work. For reference, elements of the additional contract scope are noted below. Funds to complete the contract will come from the existing 2003 budget for Job #23855 accrued to 2004 and an additional $67,767 that has been budgeted for this job in 2004.

In January 2003, EWEB entered into a contract with CCI to perform FERC dam safety tasks for the Carmen-Smith Hydroelectric Project. The contract value was not-to-exceed $45,324 for the scheduled 2003 Part 12 Safety and Inspection Report as required by the FERC guidelines at that time.

In May 2003, FERC requested that EWEB perform the upcoming inspections and reports in accordance with a new FERC Part 12 program and reporting format. The additional scope of work in this program included: i) conducting a Potential Failure Mode Analysis (PFMA) review and workshop; ii) preparing a baseline document (Supporting Technical Information document, STI) describing the key project features and summarizing the latest engineering analyses on specific issues; and iii) preparing the dam safety inspection reports in accordance with a new format and outline as specified by FERC. EWEB agreed to perform the dam safety review and report in accordance with this latest FERC request. EWEB has also received FERC approval to delay the submittal of the 2003 Carmen-Smith Part 12 Safety and Inspection Report to July 1, 2004. Contact person is Larry Billhartz, 484-2411, ext. 3215.



Nixon Peabody LLP - Bond Counsel Services - Financial Services Division. A Request for Proposal (RFP) was used to survey the market and to determine which legal firm could best represent the utility as Bond Counsel. The RFP was advertised and solicited in accordance with State of Oregon Public Contracting laws and EWEB adopted rules. Proposals were received on Monday, October 27, 2003 and publicly opened and recorded. Five legal firms responded: Orrick Herrington & Sutcliffe LLP/Cable Huston of Portland, OR; Preston Gates & Ellis LLP of Portland, OR; Hawkins Delafield & Wood of New York, NY; Foley and Lardner of San Francisco, CA; and Nixon Peabody LLP of San Francisco, CA. The proposals were evaluated and proposals ranked in accordance with the evaluation criteria described in the RFP. Nixon Peabody LLP was identified as the highest ranked proposer to replace Foley Lardner as the Board Appointed Bond Counsel.

This initial contract, if approved, will be for three years with an option, at EWEB's discretion, to renew for two additional one-year periods. Nixon Peabody will be retained and used on an "as needed" basis. The exact annual expense amount is unknown; staff estimates that services will be approximately $200,000 each year, a possible total contract amount of $1 million over the five-year contract period.

Staff requests that the Board appoint Nixon Peabody as the utility's Bond Counsel. Bond Counsel will be evaluated and their appointment ratified annual in the Board Appointed Consultant Evaluation Report. Contact Jim Origliosso, Customer & Financial Services Division Director, 484-3753.



RSCI (Meridian, Idaho) - Carmen Turbine Cavitation Repairs and Butterfly Valve Upgrades - Electric Division. On September 16, 2003, the Board authorized EWEB staff to enter into a $127,708 contract with RSCI for Carmen Smith turbine and butterfly valve repairs. The contract amount was based on an estimated scope of work and unit prices were requested for additional work discovered during the outage. The actual contract costs will exceed the base bid amount by approximately $54,600 (42.75%) thereby requiring additional Board authorization. Staff believes this additional authorization is justified and correctly reflects the additional contract work scope encountered under difficult site conditions. Funding for this increase is provided under Job #23845 in the 2003 budget.

Most of the increased contract cost was associated with additional repair tasks on the two 114" diameter butterfly valves. The epoxy repair method chosen to refurbish the valve seats, in place, was labor intensive and had to be done under difficult conditions due to leakage in the Carmen Power Tunnel. The valve seats were extensively worn due to 21 years of increasing water leakage and corresponding erosion/cavitation damage. Other significant change order costs associated with the butterfly valves were as follows:

Repairing cavitation damage in the butterfly valve bypass piping

• Replacing two (2) 1-1/2" isolation valves and associated piping due to 40 years of corrosion damage
• Re-adjusting the packing box and gland box on the #2 butterfly valve trunnions.
• Extra work and safety precautions associated with routing leakage around the utterfly valves.

Contact person is Larry Billhartz at 341-1848 or E-Mail Larry Billhartz



Devine Tarbell & Associates, Inc. - Stone Creek Hydroelectric Project Environmental Monitoring and Compliance - Environmental Management and Electric Division. Contracts for Environmental Consulting Services were awarded in 1994 and again in 1999 to Devine Tarbell & Associates, Inc. (DTA). DTA has been providing EWEB environmental consulting services in support of on-going requirements of our Stone Creek Hydroelectric Project's FERC License and State Water Right Permit. Major work items include: stream guage monitoring and maintenance to assure compliance with in-stream flow requirements, expanded Corydlis (sensitive plant) monitoring based on an approved revised sampling plan, technical support to EWEB in project coordination and negotiations with U.S. Forest Service and ODFW, and monitoring and compliance reporting. Cost of the contract is $100,000 for two years.

Contractor personnel have a long history with Stone Creek Hydroelectric Project an dprovide unequalled experiece and expertise regarding environmental compliance at the project. Key personnel, such as the project manager and botanist/ecologist, have been under contract to EWEB since 1994 when EWEB took ownership of the project. In addition, prior to EWEB ownership, key personnel worked on original licensing studies and license compliance issues for previous owner. Long-term monitoring of flow and sensitive plant status are key on-going license compliance requirements. Contract has developed and implemented existing sampling plans and thus is uniquely qualified to continue this on-going work. Contact person is Tim Downey, 484-2411, ext. 3304.