Vice President Bishop said she continued to receive someone else’s mail. She wondered who was receiving her mail and whether some mail was missing altogether. She asked that a little more attention be paid to details. She also found that some documents were not complete in her packet.

Commissioner Simpson noted that he had also received duplicate items.

President Farmer asked that the record note that more due diligence in the paperwork was needed.

Commissioner Simpson reported that he had attended a Carmen-Smith Community Outreach event at the Upper McKenzie Community Center at which Marty Douglass, Catrin Van Donkelaar, and Mike McCain provided a power point presentation on the various studies associated with the Carmen-Smith relicensing project. He said representatives from the U.S. Forest Service, Upper McKenzie River Guides, and members of the general public were in attendance. He noted that another meeting on the same topic had been held on March 30 in the EWEB Training Room, though he had not been able to attend. 

Commissioner Simpson further reported that he attended a McKenzie-Willamette/Triad Medical Center open house on March 29. He said there were maps on the wall and people there were engaged in a “lively conversation” with each other and the hospital staff and architects that were present. He noted that he had counted approximately 35 people in attendance while he was there. 

Commissioner Simpson stated that he had met with Krista Hince, Assistant Secretary, to discuss electronic PDF Board packets. He related that he had advocated for making the packets available for downloading from the EWEB Web site both for Board use and for public consumption. He underscored that there was no talk at this time of eliminating hard copies of the packets. He added that he had also discussed the possibility of having the Board packets delivered in three-ring binders. He expressed appreciation to staff for delivering the April 5 packet three-hole punched. He said he also demonstrated a Google search tool that he used to rapidly access information from archived Board Minutes and Agendas dating to 1997. 

Commissioner Simpson related that he had asked Ms. Smith to create a spreadsheet delineating all of the financial data associated with the potential headquarters sale and move.

Commissioner Simpson reported that he attended a signing ceremony on behalf of EWEB on April 4 for the Clean Diesel Project, sponsored by the Lane Regional Air Pollution Authority (LRAPA). He explained that it was a clean diesel project involving the School District 4J, City of Eugene, EWEB, Laidlaw, Lane Transit District (LTD), Oregon Department of Environmental Quality (DEQ), and the Oregon Department of Transportation (ODOT), Rexius, and some other partners. He supported the use of bio-diesel fuel, stating that by using this fuel EWEB was contributing to the health and welfare of the environment and of our community.

Continuing, Commissioner Simpson brought to the Board’s attention a memorandum regarding the City of Eugene’s sustainability plan. He said it was an invitation for a meeting to be held on April 19. He stated that Mayor Kitty Piercy was kicking off the sustainability plan through this brainstorming meeting and had indicated that the City wished to have an EWEB commissioner participate if possible. 

In conclusion, Commissioner Simpson explained that he had signed up for a Google alert, so that it was brought to his attention when articles that refer to EWEB appeared in the media. 

President Farmer reported that he, Mr. Berggren, Mr. Varner, and Mr. Origliosso had traveled to San Francisco, California, to make the Bond Presentation. He said EWEB staff managed to convince the analyst to recommend to their credit committee that EWEB’s rating be upgraded. He stated that EWEB had gone from a negative outlook to a stable outlook. He related that one thing he had conveyed to the rating agency was that the Board was very involved in the strategic oversight from a financial standpoint and was very knowledgeable about what EWEB was doing. He quipped that he hoped he was right. He said he compiled a quiz on the materials EWEB had presented and would bring it to the Board at the next meeting. 

CORRESPONDENCE

General Manger Randy Berggren reported the following:

• He reiterated Commissioner Simpson’s note regarding the invitation to the Mayor’s Sustainability meeting. He noted that Vice President Bishop had indicated an interest in being a participant in that. He said the meeting was April 19 and EWEB needed to let the organizing staff know who would be coming. He recommended that someone commit to the activity.

After a small amount of discussion, the Board determined that Vice President Bishop would represent the EWEB Commissioners and Commissioner Menegat would serve as an alternate.

Mr. Berggren continued his report on correspondence:

• Brochures were out for the American Public Power Association’s (APPA) National Conference in Anaheim, California. Thus far, Commissioner Simpson and President Farmer had indicated an interest in going.
• Staff felt more public input was needed and the process to pursue another statistically balanced public survey should be undertaken. Staff hoped to gain Board input on draft questions. It was hoped that results would be available before the May 17 discussion of whether to split operations and administration or not.
• Board packets included confidential backgrounders on current legal issues.
• Cathy Bloom included an update on the Public Employees Retirement System (PERS) ruling with some initial readings of its implications by EWEB Counsel Win Calkins.
• The acquisition of the property on Roosevelt Boulevard was completed on April 1, 2005.
• Vice President Bishop registered her intention to attend the three-day Northwest Energy Coalition (NEC) meeting in Boise, Idaho set to begin on April 30.

BOARD AGENDAS

Mr. Berggren provided an overview of the Eugene Water & Electric Board: Board Agenda Report; April 5, 2005. He noted there were no outstanding backgrounders at this time. He recounted that at the last board meeting the Board had gone through the list of outstanding future Board Agenda Items and decided to place them or take them off the list. He pointed out that the report reflected this. 

President Farmer stated that Commissioner Lanning would return to his service on the Board for the meeting scheduled for April 19. He noted that Mr. Berggren planned to brief Commissioner Lanning on Board activities that had transpired during his short leave of absence.

Vice President Bishop wished to acknowledge that the Board was creating a subcommittee to work on the survey questions.

Commissioner Simpson moved to appoint Vice President Bishop and President Farmer to serve on the Survey Development Subcommittee, the purpose of which was development of survey questions on whether to split the utility’s administrative arm from its operations. Commissioner Menegat provided the second. The motion passed unanimously, 4:0.

BOARD GOVERNANCE

• Board Policies
• Board Bylaws Review

Ms. Smith introduced the topic and asked EWEB Counsel Win Calkins to respond to Board questions.

President Farmer said when he read EWEB’s General Counsel’s memorandum from Win Calkins; he felt there was still much work to do. He had a sense that the memorandum was premature.

Commissioner Menegat had reviewed the memorandum and observed that it covered items that had been discussed. He perceived where the Board was going with the different issues that had been raised. He felt comfortable with the items set forth and explained with the exception of discussion of Board meetings. He was concerned with the language that indicated the Board “usually meets” at a time. He wanted more specificity. 

Mr. Calkins observed, in looking at the policies and Bylaws, there were nuances between State law, the EWEB charter and the Eugene Code. He recommended the Board retain language that indicated that meetings were “regular” or “special.” One area that raised questions, he noted, was the language that allowed a seat on the Board to be declared vacant should a Commissioner have three unexcused absences. He said because of the nuances between the Charter and the Eugene Code provisions, in order for that to work the Board would have to designate the meetings as one or the other. He explained that the City Council retained control over the terms of office. He recommended retaining the current language.

President Farmer declared that the Board had two meetings per month and therefore should call them regular board meetings. He was not opposed to retaining the rule whereby a Commissioner would lose his or her seat for three unexcused absences in a row.

Commissioner Simpson agreed. He said he could “live with” a regular meeting and a special meeting. He thought it did allow for definition of a minimum of meetings. He preferred to state it as it was the standard business practice to have the meeting on the first Tuesday of the month. He did not think it should be locked in the Bylaws to a regular day given that the meetings were sometimes moved to other dates so that they would not conflict with Election Day, for instance. 

Vice President Bishop said the Board met twice a month and the meetings were regular so they should be called regular. She observed that a “special” meeting was usually called “in a special way.” She declared that there was absolutely nothing special about the EWEB Special Meetings.

Commissioner Menegat concurred. He said the word “special” should mean just that and the Bylaws should have a regular meeting with a time and date set.

President Farmer asked if it was necessary to include in the Bylaws a definition of the time of meetings. He thought the Board would be better off with an operating procedure that said the Board met at 7:30 p.m. He felt the Board would be better served by language that said it would meet on the first and third Tuesday at a time to be established by the Board.

Mr. Berggren noted that there were Boards in the past that wished to take the second meeting in August off. 

Mr. Calkins said the Board could build flexibility into the language if the Board wished to include meeting frequency and duration in the Bylaws.

President Farmer suggested the language read that the Board meetings should be held on the first and third Tuesday unless the Board dictates otherwise.

In response to a question from Vice President Bishop, Mr. Calkins stated that either the Board President or the General Manager could call a meeting. He said the Board had the flexibility to put in the type of routine the Board wished to see.

Commissioner Menegat thought the Board, as elected officials, could get together in the event it was at odds with the General Manager and conduct a meeting provided it met legal noticing requirements.  He averred that the manager could not “hold [the Board] hostage” by refusing to convene a meeting when asked to. 

Mr. Calkins stated that there was flexibility in putting language in the bylaws. 

Vice President Bishop asked if there was a model in which a majority of the Board could convene a meeting. 

Commissioner Simpson wanted to avoid any hint that a meeting could be called without a quorum, given that it could not convene without a quorum by law.  He said technically several board members calling one another could be considered a meeting. 

President Farmer said there had to be a precedent whereby other legal boards had convened the meeting. He supported enabling the Board to call a meeting, if necessary. 

Commissioner Menegat reiterated that the meetings held on the first and third Tuesdays were already in place. He stated that the only time the Board would convene a meeting would be in the case of an emergency arising between Board meetings. President Farmer responded that one did not have “to go back too many general managers to see where [this might have been used].” 

Ms. Smith said the language had been a part of the bylaws since the beginning.

President Farmer observed that the memorandum from Calkins & Calkins utilized the word ‘study’ a lot. He felt the memorandum seemed to convey that the work on the bylaws was not near completion. Mr. Calkins replied that it was a “work in progress.” 

Ms. Smith clarified that staff sought to determine that Mr. Calkins was researching the right issues by checking in with the Board. 

Regarding item 4 from the memorandum, Ms. Smith explained that the language there regarding the choice of utilizing Robert’s Rules of Order over EWEB’s rules of order or rules of conduct when at an impasse had been a result of a Board discussion. 

Mr. Calkins stated that Robert’s Rules of Order were now over 700 pages long. He thought the Board could refer to it in the event of a procedural impasse.

Vice President Bishop thought it odd that there were EWEB rules of conduct, but they were not called out nor were they discussed. She felt there was a general assumption that most people who come on the board have some knowledge of Robert’s Rules of Order. She advocated for choosing either Robert’s Rules or EWEB’s rules of conduct, rather than having a more nebulous idea of rules of conduct. She was concerned that a parliamentarian would join the Board and undermine the more informal process.

President Farmer noted that the EWEB rules of order had been included in board packets several weeks earlier.

Mr. Calkins said it was fine to have a modified EWEB’s Rules of Order, but those rules had not been referenced or abided by. He felt the process should be left an informal one, but in the case of a procedural impasse Robert’s Rules should be consulted. He added that much of Robert’s Rules were designed for quick reference.

President Farmer said he was not uncomfortable with the current rules of order.

Vice President Bishop opined that it was “inappropriate” to have language in the bylaws that indicated the Board was operating under an informal process. She recommended that the Board spend some time reviewing EWEB’s rules of order.

Vice President Bishop thought the EWEB rules of conduct were “absolutely useless” because there was nothing in place for anything to be done when those rules were violated. She objected to referencing them in the Bylaws. Ms. Smith suggested pulling them out of the Bylaws and leaving the rules of conduct in the “policy piece” of governance.

Vice President Bishop did not understand what Section X of the memorandum was about.  She knew the quorum was three. She asked if there was an issue the Board needed to address. Mr. Calkins replied that the City Charter did not provide how many votes it took for EWEB to act nor did it define a quorum. However, a State statute had been interpreted for a number of years that had been considered to apply not only to State agencies, but to local public bodies.  He stated that the consistent advice of the Attorney General had been that a majority had to be the majority of the positions, which in the EWEB Board’s case, there had to be a majority of three votes to either pass or veto a vote; out of the five positions. So if there were only three Commissioners at a meeting, they all had to vote the same in order for a vote to pass.

Vice President Bishop thought this was “weird.” She asked if it could be changed. Mr. Calkins responded that the Attorney General’s interpretation of a law was considered by most in government to be the final word.

Commissioner Menegat felt it would undermine the fiscal integrity of the utility should the Board exercise its bonding authority by a vote of 2 to 1. 

Vice President Bishop likened disallowing a quorum’s ability to take action without a unanimous vote to being “hamstrung.” 

Vice President Bishop asked what would happen if four out of five board members suddenly resign. Mr. Calkins replied that there was a provision that said the Board had the authority to fill a vacancy within 90 days and if the 90 days expired the City Council could appoint another Commissioner.

Ms. Smith proposed continuing the work with Mr. Calkins to refine the language and then to bring it back before the Board at the next meeting. The Board was amenable to moving on with the agenda.

Commissioner Menegat indicated that he would forward any further comments he had to Ms. Smith.

Vice President Bishop said she would do so as well. She added that she felt some of what the Board was addressing under the heading of governance was not governance so much as it was a policy issue. She cited power risk management policies. She was uncertain of how to get back to the point at which there was clarity as to what the policies that affected the whole utility were. 

Ms. Smith pointed out that the policies were those that were already approved of. She said there was a stack of policies that needed to be prioritized and reviewed, but those policies would be brought before the Board at a later date. 

Mr. Berggren disagreed. He saw policy setting and role-definition as all part of the governance process for the organization. He underscored that the Board of Commissioners was part of the organization.

Vice President Bishop averred that staff was not making a fine enough distinction.

President Farmer remarked that it was “not rocket science.” He said governance was two things: what the body did and how the body did it. 

BUDGET AMENDMENT NO. 1 – MICROWAVE/UHF COMMUNICATION SYSTEM

Treasurer Jim Origliosso explained that the budget amendment was before the Board according to the Board’s wish to review such things. He said it was an amendment for a major capital project. He asked for the Board’s support for the supplemental budget, which sought to add the money budgeted for the project in 2004 to the 2005 capital budget.

In response to a question from Commissioner Simpson, Mr. Berggren explained that this action was a formality. 

President Farmer asked when the project was originally scoped and what the estimated cost was. Electric Engineering Manager Dean Ahlsten replied that the project was budgeted in 2004 to cost $1.2 million over the course of two years, with a 10 percent contingency added for the second year. He stated that the second phase of the project was in the capital plan and was anticipated to be expended in 2006. He added that though it was a continuation it was classified as a separate project. 

Vice President Bishop asked why it was phased. Mr. Ahlsten responded that the total build out was based on some grant applications the utility was submitting to the Homeland Security and was in partnership with the Lane County Sheriff’s Office (LCSO). He explained that the first phase would essentially complete the system through the lower McKenzie River area and Phase 2 would extend it to the Carmen-Smith facility.

Mr. Ahlsten noted that the transportation bill on the floor of Congress would likely change the scope of what was being built. He added that while the bill would change the direction of the project, it would not likely change the total cost.

Commissioner Simpson asked who the users were of the system. Mr. Ahlsten said ultimately it would be other public agencies such as the fire districts. 

In response to a question from Commissioner Simpson, Mr. Ahlsten stated that the full build out would create a 20 channel trunk system so that the City government, fire districts, and so on would have the ability to communicate on the system and the resources, such as equipment, would be shared. He added that an inter-governmental agreement (IGA), approved a month earlier, covered the microwave backbone of the system. He said that should EWEB change course and complete the system, the utility would have to amend the IGA so that costs of the system would continue to be shared.

Commissioner Simpson asked if the City of Eugene’s crews would be able to use the system.  Mr. Ahlsten replied that this was the ultimate goal.

Commissioner Menegat moved to approve Budget Amendment No. 1 to transfer $500,000 from the capital reserve to the Project 21386 budget for 2005. Commissioner Simpson provided the second. The motion passed unanimously, 4:0. 

GENERAL MANAGER’S GOALS – CARMEN-SMITH FUNDING STRATEGY OVERVIEW

Mr. Berggren said, per the Board’s instruction, he had tried to develop a strategic plan to establish some debt/equity funding target for the Carmen-Smith relicensing work. He commented that at this point there was no obvious uncommitted funding source for an equity contribution to the project other than an additional rate action. He observed there was also substantial uncertainty as to when the construction date of Carmen-Smith would be as well as the cost and benefits. Additionally, he noted there was substantial uncertainty about the financial risk associated with some of the other substantive issues the utility was currently addressing, such as the PERS issue. He felt he had been thrown into this “rat’s nest of uncertainty,” but he agreed that a strategy was needed. He proposed to find what the financial uncertainties were for ten years from this point. He briefly reviewed the memorandum to the Board entitled Carmen-Smith Financing Strategy Scope of Work.  Commissioner Menegat conveyed his appreciation for the document and its content.  He said it helped him to understand the utility’s financial strategies. He also appreciated the “deliverables.”  He foresaw them coming forward and being built upon as the utility moved through the current process and learned from it.

Vice President Bishop asked if the resources were available within the utility. Mr. Berggren responded that staff was building models and trying to decide which model would best serve the utility. In response to another question from Vice President Bishop, Mr. Berggren stated that some consultant work would be necessary. He noted that the utility was presently advertising for $30,000 to contract to hire consultants whose job it would be to determine a baseline on what it would cost to decommission the project. 

Commissioner Simpson also appreciated the work that went into the planning. He thought it fit well into Mr. Berggren’s goal work. He said the work was a good launching pad for the project.

President Farmer was glad to see the utility getting this start. He reiterated his preference for approaching it from an equity position rather than borrowing money. 

In response to a question from President Farmer, Mr. Origliosso said there were fixed costs associated with putting in the license application, but the Carmen-Smith project was an issue of critical mass. Mr. Berggren added that the costs were very site specific. 

President Farmer asked if decommissioning the project would require it to be torn out. Mr. Berggren thought that it would be a likely requirement. He noted that the Carmen-Smith site had great recreational value. He said staff members would be traveling to Cushman, Washington, to discuss the choice made there to decommission a power-generating dam. 

President Farmer encouraged the General Manager to plan for a worst-case scenario, but the fact that there were dams in Lane County that did not generate electricity and were used for recreation seemed to support that Carmen-Smith could be left as it is. He added that another option was to sell the facility.

President Farmer said he would like to see the utility set aside $15 million per year over five to ten years to address whatever action deemed necessary at the Carmen-Smith facility. 

Items Removed from Consent Calendar

Commissioner Simpson offered the following correction to the minutes from the Special Board Meeting held on February 1:

• Page 5, paragraph 5:  “Commissioner Simpson commented that his great-grandfather helped to build had built a cabin up the river in Rainbow …”

Commissioner Menegat offered the following correction to the minutes from the Special Board Meeting held on February 1:

• “Commissioners had been provided with the most recent litigation update, with the exception of the Ida Mae retiree lawsuit, which would be the subject of the Executive Session…”

Commissioner Simpson asked staff to contact the members of the public who had testified at the February 8 Special Board Meeting and whose testimony had not been picked up by the microphone in order to provide them with the opportunity to submit their testimony in writing.

Commissioner Simpson provided the following corrections for the minutes of the Public Hearing held on March 2:

• Page 5:  David Rodriguez’ last name was spelled incorrectly.
• Page 6:  Rosie Prior’s address should read 2671 East Wilshire Drive.
• Page 8:  Scott Bartlett referred to the Commissioners and not the singular as printed.  Jon Silvermoon’s first name was incorrectly spelled.

Commissioner Simpson provided the following corrections to the Work Session held on March 15:

• The time was incorrectly noted with five numbers.
• Page 1, fourth bullet point under strategic planning issues:  “Strategic Thinking Group is to be used for initiative development and review of short-term contingency plans and that are currently being developed…”

Commissioner Simpson offered the following corrections to the minutes of the Special Board Meeting held on March 15:

• Page 1, Agenda Check:  “There were not no objections to moving the item.”
• Page 6, paragraph 5:  “…staff had not received any direction on whether the to schedule the item for discussion.”
• Page 7, paragraph 1:  “Mr. Berggren reviewed the April 15 April 5, 2005, Board meeting agenda.”
• Page 10, paragraph 6:  “President Farmer declared that he had a conversation wit with the owner of the Good Company…”

Vice President Bishop moved to approve the minutes removed from the Consent Calendar as amended. Commissioner Menegat provided the second. The motion passed unanimously, 4:0.

President Farmer moved on to the other two items that had been removed from the Consent Calendar, a contract for business services and a contract with a publishing company for advertising.

Mr. Ahlsten explained that the contract with Barrett Business Services represented a line technician position and an equipment operator and $150,000 covered both positions for a year.  President Farmer realized that he had not really needed to pull the item.

Vice President Bishop asked for clarification. Mr. Berggren explained that the two employees were retirees who were not able to work directly for EWEB because it would place in jeopardy their PERS benefits. Vice President Bishop reiterated her qualms about using temporary services and potentially “circumventing the law.” Mr. Berggren offered to provide a memorandum from legal counsel on the issue.

President Farmer observed that this issue merited a larger discussion at a future meeting.

Vice President Bishop asked how using the temporary service agency fit in with hiring new people to assume these positions. Mr. Berggren replied that EWEB was seeking to fill those positions and was short-handed. This, he said, was why they had been forced to ask the retirees to come out of retirement.

Vice President Bishop suggested EWEB “beef up” its apprentice program. Mr. Berggren reassured her that staff was working to the best of their ability to fill in the gaps.

Vice President Bishop moved to approve the contract with Barrett Business Services, Item 2 in the Consent Calendar. Commissioner Simpson provided the second. The motion passed unanimously, 4:0.

President Farmer explained that he had pulled Consent Calendar Item 3 because he wished to declare a conflict of interest, due to his company doing business with Guard Publishing.

Commissioner Menegat moved to approve the contract with Guard Publishing Company, Item 3 in the Consent Calendar. Commissioner Simpson provided the second. The motion passed unanimously, 3:0; President Farmer abstaining.

President Farmer adjourned the meeting at 9:58 p.m.