Board Members present: Patrick Lanning, Sandra Bishop, Dorothy Anderson, Mel Menegat, and Ron Farmer.

Others present: Jim Wiley, Debra Smith, Jim Origliosso, Roseanna McArthur, Marty Douglass, Tom Buckhouse, Mike Logan, Charles Dalton, Deborah Brewer, Dick Varner, Dick Helgeson, Mark Freeman, Kris Kendall, Mat Northway, Judy Chase, and Krista Hince of the EWEB staff; Ruth Atcherson, City of Eugene Minutes Recorder.

President Lanning called the Special Board Meeting of the Eugene Water & Electric Board (EWEB) to order at 7:48 p.m.

AGENDA CHECK

There were no changes to the agenda.

PUBLIC INPUT

There were no members of the public who wished to speak at this time.

APPROVAL OF CONSENT CALENDAR

Minutes

1. Minutes of the April 6, 2004, Regular Board Meeting and the May 4, 2004, Executive Session.

Business Service Agreements

2. Quantec - Integrated Electric Resource Plan Model Portfolio Strategist Implementation - Power Resources - $8,000

• North Creek Analytical (NCA) - Analytical Services for EWEB's Drinking Water Source Protection Program - Environmental Services Department - Corporate Services - $200,000 over five years

Vice President Bishop pulled the minutes from the Regular Board Meeting held on April 6, 2004.

Commissioner Farmer, seconded by Commissioner Anderson, moved approval of the Consent Calendar, with the exception of the minutes from the Regular Board Meeting held on April 6, 2004. The motion passed unanimously, 5:0.

ITEMS FROM BOARD MEMBERS

Commissioner Farmer reported that he had a call from a downtown business owner complimenting EWEB on its willingness to work through deposit issues. He shared that the business person had gone through the appeal process the Board and staff had set up and was "extremely satisfied" with the outcome.

Vice President Bishop related that the Register-Guard had called her regarding the potential siting of the new hospital at the EWEB site. She said she told them the change was not causing EWEB to move, but rather was only a part of a process EWEB had already embarked upon.

Vice President Bishop called attention to an ad for the privately-owned power plant proposed to be built in Coburg. She noted that several quotes from Commissioners had been included in the ad, taken from public meetings. She noted she had not the time nor the veracity to check the accuracy of the quotes. She felt the time was coming for the Board to take a stand on the gas-fired plant.

Vice President Bishop commented that it seemed the Board Governance work was helping as Board members had made it clear, when quoted, that they were speaking for themselves.

President Lanning announced he would not be available for the June 1 Work Session as he would be in an interview but would make the Regular Board Meeting.

CORRESPONDENCE

Acting in the Absence of General Manager Randy Berggren, Electric Division Director Jim Wiley reported the following:

• The next Board retreat was scheduled for July 14 on the top floor of the Hilton Hotel.
• The American Public Power Association (APPA) conference was scheduled for June 19 through June 23 in Seattle, Washington. Debra Smith, Jim Origliosso, Dick Helgeson, and Commissioner Farmer were planning to attend. It was still possible to arrange to attend, should other Commissioners wish to go.

BOARD AGENDAS

Commissioner Menegat noted that the Board had discussed holding a Board meeting at a location in the McKenzie River Valley and suggested that the meeting be planned for July. He recommended that the Board hold a Work Session wherein it would receive reports on construction and relicensing issues and invite the valley residents to attend, and then, during the Regular Board Meeting, residents could ask questions and provide input regarding those issues.

Assistant Secretary Krista Hince affirmed, in response to a question from Commissioner Farmer, that meetings had to be within the service boundaries, and as such, the McKenzie River Valley qualified.

President Lanning agreed that holding a meeting upriver in July was a good idea and asked staff to work on scheduling it.

Mr. Wiley noted that the next meeting would include new Commissioner orientation; a review of miscellaneous charges; and a discussion on the variable rates swap policy, followed by an Executive Session. He indicated that the proposal to have a joint meeting with the Emerald Public Utility District (EPUD), was for the purpose of hearing a presentation from the Northwest Energy Coalition. He related that the two utilities were conferring, but it looked as though separate meeting dates were in order, due to time conflicts.

LOW INCOME PROCESS IMPROVEMENT

Key Accounts Manager Mike Logan provided an overview of the Service Deposits and Late Fees: Follow Up on April 20 Board Discussion as outlined in the memorandum dated May 19, 2004. He conveyed staff's proposal to allow the Energy Share program serve as guarantor. He explained that this approach would not require any initial transfer of funds as funds would not be drawn upon unless there was a potential delinquency.

Customer Relations Manager Chuck Dalton related that many phone calls had been received from low income customers regarding the deposit policy. He said the proposed change would cut the deposit for those customers in half. He noted that this was aligned with a request from a group of people for low income supporters calling themselves the Housing Stabilization Providers. He stated that this approach would not prevent low income customers from accessing the $300 they could receive in energy assistance. He highlighted the simplicity of this change as no policies would be changed or recreated. It fit in with the "menu item" approach as well.

Regarding a late fee, Mr. Logan reported that more work was required in order to make a proposal for such a fee.

Mr. Dalton affirmed, in response to a question from Commissioner Menegat, that the first half of the deposit came from the customer and would be expended prior to tapping the Energy Share portion of it.

Commissioner Anderson asked if the statistics on bad debts were from residential customers alone. Mr. Freeman responded that the statistic encompassed all customers.

Commissioner Farmer liked this approach better than the original one as it answered many of the issues people had. He wondered, though, what was meant by guarantor and whether or not the utility used a collections agency.

Customer Services/Field Services & Cash Collections Supervisor Mark Freeman stated that there was no in-house collection process. He explained that there was a 60-day window to pay and after 90 days, an outstanding balance was passed along to a collections agency and would ultimately be noted on the customer's credit record.

Vice President Bishop questioned whether this placed an undue burden on staff energy. Mr. Dalton did not anticipate more work for staff. He noted that the service and the requisite eligibility process were handled by an outside agency.

Commissioner Farmer asked if a cap had been established on the amount of money dedicated to deposits. He thought that potentially there could be much more of the Energy Share money tied up in deposits than had been originally projected. Mr. Logan responded that there was a $300 maximum per individual. Mr. Dalton assured him that, based on the number of people applying for other programs that were available, a "huge rush" for aid in deposits was not projected to happen. He asserted that, though the numbers of applications for aid had increased somewhat, it had not been catastrophic.

Commissioner Farmer asked that the Board be made aware if it seemed the amount of the money dedicated for deposits would exceed $50,000. Mr. Dalton assured him the Board would know and that staff was seeking to build a monthly report into the process to aid in monitoring the program.

Vice President Bishop moved to accept the staff recommendation that Energy Share funds be used as a deposit guarantor for one half of the assessed deposit for qualified low-income customers, not to exceed $300. Commissioner Anderson provided the second.

Vice President Bishop called this a move in the right direction. She added that she hoped staff could provide a recommendation for a late fee policy soon.

Commissioner Anderson supported this approach.

In response to a question from Commissioner Farmer, Mr. Freeman said the guarantor was released after 12 months if utility bills were paid in full and in a timely fashion.

Commissioner Farmer expressed interest in knowing how much the guarantor added into the fund over the coming year. Mr. Dalton responded that he would include this information in an annual report.

The motion passed unanimously, 5:0.

APPROVAL OF BUDGET AMENDMENT NO. 2 FOR THE DEMAND-SIDE MANAGEMENT AND RETAIL SERVICES CONTRACT

Fiscal Services Supervisor Dick Varner explained that, per Board instruction, Budget Amendments were no longer included in the Consent Calendar and this was the first one to be brought before the Board as part of the Regular Board Meeting.

Energy Management Services Manager Mat Northway indicated that the background information was contained in a memorandum entitled Budget Amendment to Accommodate EWEB-BPA Conservation Agreement dated May 18, 2004. He said the utility had just settled the invoice and anticipated sending it off within 30 to 60 days, and hopefully the utility would then receive a check from the Bonneville Power Administration (BPA). He pointed out that tables on the back of the memorandum showed additional work to be done yet this year, essentially another $2.1 million of expenditures in the customer conservation program and $2.6 million of additional billing to the BPA through the Conservation Augmentation Agreement contract. This would result in finishing the year approximately $1.2 million ahead and with up to 3.2 Mega-Watts (MW) of conservation installed.

Commissioner Menegat moved to approve the 2004 Energy Management Services Department Budget Amendment to expend up to an additional $2.1 million in customer conservation programs in 2004. Commissioner Anderson provided the second. The motion passed unanimously, 5:0.

BOARD GOVERNANCE

• Relationship with City Councilors

Intergovernmental Affairs Coordinator Deborrah Brewer directed the Board's attention to the memorandum entitled EWEB/City Councilor Relations. She expressed her intention to listen to the discussion and answer questions if necessary.

Commissioner Menegat related that Councilor Jennifer Solomon had contacted him regarding concerns about EWEB expressed to her by a constituent. Ms. Brewer remarked that it seemed the councilor felt the door was open for her to interact with EWEB Commissioners.

Public Affairs Manager Marty Douglass noted that Commissioner Farmer had recommended developing an informal relationship with the individual councilors, perhaps, as an example, by having routine breakfasts with them.

Ms. Brewer stated that, at a staff level, things were working well and Mr. Berggren was speaking regularly with City Manager Dennis Taylor.

Commissioner Anderson shared her experience in the past with City Councilors wherein the Board had tried to "force" things and it had just not worked. She opined that though the commissioners may share a ward with two councilors, they may not share an affinity with them. She related that the most successful interaction between the Board and councilors was fostered on three or four common issues between the utility and the City. She noted another instance in which Councilor/Commissioner liaisons were being attempted in which it had not worked as only one Commissioner, herself, had followed through.

Mr. Douglass remarked that Susie Smith had, as the At-Large Commissioner, fostered a relationship with Mayor Jim Torrey.

Vice President Bishop felt the election of new City Councilors presented an opportunity to educate them about EWEB. She underscored the importance of building relationships.

President Lanning suggested that some talking points be developed to aid the Commissioners in speaking with the City Council.

Vice President Bishop recommended that EWEB invite the Councilors on tours of EWEB facilities. She thought including a river float would make the experience more inviting. She noted Mayor Torrey had toured the facilities. She opined that the last time Commissioners had met with the City Council it had been a "failure" as EWEB was only an item on the agenda and there had been no interaction.

Commissioner Farmer questioned whether there would be much dialogue between EWEB and the City if the City was not so keen on siting a hospital on EWEB property. He shared his experience with the Chamber of Commerce in which there were governmental affairs people assigned to City Councilors. He said the largest value that came out of the meetings with individual City Councilors came from having two people meet that did not agree. He explained that breakfasting with Councilor David Kelly over a two year period had been particularly fruitful, though they did not agree. He met with Councilor George Poling for nearly a year and had not found those meetings to be as productive.

Commissioner Farmer clarified, in response to Vice President Bishop, that the meetings were intended to establish rapport and also to provide input on issues the Chamber sought support for. He advocated for creating talking points, printing them on a sheet of paper, and leaving them with the Councilor the Commissioner had met with.

Ms. Brewer asked what the top three things the Commissioners wished to speak to the City Councilors on.

Commissioner Farmer cited the move as the top issue. He underscored that the City was spending money to help McKenzie-Willamette/Triad Medical Center to develop the site and thought the City should be asked what they intended to spend to help EWEB relocate.

Vice President Bishop advocated for sharing an encapsulated version of what EWEB did, its history, and the current context within which the utility was working, i.e. its financial crisis due to drought conditions.

Commissioner Farmer commented that speaking to the council was generally built around wanting something. He stated that ultimately he wanted an amendment to the Contributions-In-Lieu-of-Tax (CILT) and would choose to speak to them about it. He also felt, because there were many constituents who supported undergrounding as it improved esthetics, that the Board should talk to the City regarding their participation in that endeavor and any systems development charges (SDCs) that could be enacted to aid toward that end.

Vice President Bishop asked staff to provide a list of the Inter-Governmental Agreements (IGAs) between EWEB and the City.

Commissioner Farmer suggested the City be asked for a list of their expectations, particularly in regard to rapid transit, as it was a big issue that affected EWEB.

Vice President Bishop underscored the importance of including information on the water utility.

Commissioner Anderson asked if EWEB could, perhaps, participate in the orientation of new City Councilors. Ms. Brewer acknowledged that it presented a good opportunity.

Ms. Brewer asked if the Board wanted to consider which City Councilors the EWEB Commissioners wished to speak with. Commissioner Farmer suggested beginning with the Councilors they shared wards with. Vice President Bishop remarked that some Commissioners already had relationships with certain councilors.

Commissioner Farmer stressed the importance of reporting back to the Board regarding contacts with councilors.

Vice President Bishop thought protocol should include that the Board President would speak with the Mayor.

• External Communications

Mr. Douglass explained that he had taken the Board's feedback and revised the policy. He recommended considering the revised policy and then deciding whether or not to take action on it.

Commissioner Farmer related that he had received a phone call earlier in the day and asked if a Commissioner, under this policy, could give an interview over the phone. Mr. Douglass responded that it was up to individual discretion, but that the Commissioner would be expected to be clear that he or she was representing themselves and not the Board.

Vice President Bishop felt it had not been clear in the past who was the Board liaison for the different groups the Board interfaced with. She expressed concern that the fourth bullet point in the draft External Communications Policy was not explicit enough. President Lanning read it as the Board would designate a Commissioner to speak to an issue. Mr. Douglass agreed, adding that he intended the language to indicate that such a situation would be issue-specific and the Board would designate its representative as issues arose.

Vice President Bishop cited the example of a letter signed by Commissioner Anderson. She had thought at the time that the letter should be signed by President Lanning. She related that Mr. Wiley had clarified for her that Commissioner Anderson was a voting member of the group that the letter was addressed to. She suggested the language of the policy make this distinction.

Commissioner Farmer agreed it was important for Board members not to overstep their boundaries. President Lanning concurred, adding that being the appointed liaison to a group did not automatically mean a Commissioner was the "point person." Commissioner Anderson could not recall an example of a Board member assuming such a position without consulting the Board.

Regarding the first bullet point, Vice President Bishop recommended that the word 'all' be struck from the second sentence. Mr. Douglass responded that EWEB could receive as many as two to three media calls in a day if there was a pending issue. He thought a certain amount of the calls could be handled by staff. He offered to delete the second sentence. Mr. Wiley suggested that merely deleting the word 'all' would meet the needs of the policy and the Board.

Vice President Bishop recommended the following change to the third bullet point:

"In these instances, the individual Board member should follow the protocol listed in this policy as much as possible."

Mr. Douglass asked if the policy could be brought back as a Consent Calendar item for action after it was revised.

Commissioner Farmer expressed his preference for taking action on it as a Consent Calendar item.

Vice President Bishop opposed this. She proposed bringing it back as an agenda item with no discussion.

President Lanning polled the Board and the Commissioners, with the exception of Vice President Bishop, they indicated their wish to act on the draft External Communications Policy via the Consent Calendar.

ITEMS REMOVED FROM THE CONSENT CALENDAR

Vice President made the following corrections to the minutes of the Regular Board Meeting held on April 6:

• Page 2, paragraph 6: The ECCO Trust Building was incorrectly identified as the Heathman Trust Building.

• Page 2, last paragraph: The Fair and Clean Energy Coalition was incorrectly identified as the Fairing Clean Energy Coalition.

Vice President Bishop, seconded by Commissioner Menegat, moved to approve the minutes from April 6, 2004, as amended. The motion carried unanimously, 5:0.

President Lanning adjourned the meeting at 7:15 p.m.

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Assistant Secretary President