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HomeMy WebLinkAboutElectric Board - Minutes - 03/20/1996Council Liaison: Alan Apt II Staff Liaison: Don Botteron Chairperson: Mark Fidrych Phone: 490-7240 (W) 223-7140 (H) Vice Chair: Jeff Ei hm Phone: 491-5784 223-9487 A regular meeting of the Fort Collins Electric Board was held on Wednesday, March 20, 1996, in the Light and Power Training Room, at 700 Wood Street, Ft. Collins. BOARD MEMBERS PRESENT: Jeff Eighmy, Mark Fidrych, Len Loomans, Barbara Rutstein, Richard Smart BOARD MEMBERS ABSENT: Bill Brayden and Jim Welch STAFF PRESENT: Ellen Alward, Don Botteron, AI Boushee, Delynn Coldiron, Eric Dahlgren, John DeHaes, Ron King, Bob Kost, Tom Rock, Rich Shannon, Dennis Sumner, Steve VanderMeer, and Kevin Westhuis OTHERS PRESENT: John Bleem, Paul Eckman BOARD LIAISONS: Council Liaison -- Alan Apt Staff Liaison -- Don Botteron 1. APPROVAL OF MINUTES: A Motion was made by Board Member Loomans to approve the Minutes. Board Member Smart seconded the Motion. The Motion passed unanimously and the Minutes from the February 21, 1996 meeting were approved. -1- 2. GOVERNANCE: Rich provided Board Members with an overview of the revised information that was provided to Board Members. Staff is currently reviewing the charters that have been received from the utilities that have been identified for research purposes. Staff will continue with this review process and, will draft a conceptual proposal that makes sense for Light and Power. This draft proposal will be given to the Board for review and endorsement. Once endorsed, this proposal will be forwarded to City Council and the Charter Review Committee. The work session with City Council is still scheduled for June 25. However, the June 17 meeting with the Charter Review Committee is being rescheduled for the first part of July (either July 1 or July 8). It was stressed that the Utility's request to change its governance structure to an independent board is a request for more governance, not less. Board Members were encouraged to reinforce this message whenever possible. Don provided Board Members with additional details on the items included in the revised Memorandum. There was some discussion on approval ofjoint ventures and whether or not the Utility's agreement with Platte River was covered under this. Paul Eckman, attorney from the City's legal staff, answered that although the Charter says that intergovernmental agreements, such as the agreement with Platte River, must be authorized by Council, this item is not considered a legislative act, and an amendment could be made to the City's Charter that would pass this authority on to the Electric Board. It was suggested that this issue needs to be clarified as part of the Charter revision process. According to most of the general managers from the utilities we are researching, PILOT's are one of the most contentious issues that their utilities face. They recommended that we clarify how the transfer will occur and how the amount will be calculated. Our current City Charter language places full responsibility on Council by Ordinance. Council sets the amount of the PILOT's and there are no restrictions. A number of the charters we have looked at give a specific methodology or a reference to a reasonable level of PILOT's. Most charters also include "not to exceed" language. Staff will continue to study this issue further. It was suggested that Council might be receptive to a recommendation from the Board to revise or add language to the City Charter that would clarify this issue and give Council some confirmation that the amount the Utility is paying for PILOT's is fair and in line with competing utilities in our region. There was some discussion on setting rates. Because rate setting is of wide spectrum impact -- it applies to everyone, and is of endless duration unless it is changed by later rates, it fits into the definition of legislative behavior. Legislative acts have to be executed by the governmental agencies that that are responsible to an electorate. Current Charter states that it is the responsibility of Council to set rates by ordinance. Although the charter language can be changed, there is still the issue that legislative acts have to be executed by elected bodies. It is possible that an appointed board, who is subject to the -2- control of an elected body, could be responsible for legislative type acts. Legal staff will continue to research this issue. A question was posed as to whether or not our research has found any utilities that are funded by mil levies. Typically all utilities operate on revenues from the sale of power, and the utilities that have been contacted so far are no different. The Utility currently has areas that are considered cost based, but could be considered as revenue generators, i.e., joint use contracts. It doesn't cost the Utility anything to have the phone company attach to one of our poles, but revenue is received for allowing them to do this. This revenue does help offset the original cost of equipment, but really flows back into general revenue and reduces the need for direct sales revenue. This might be an entrepreneurial area that fits quite well in a more business -like environment. It is anticipated that nontraditional revenue generation will become more common. There was also brief discussion on including other utilities under the authority of the board, whether or not the Charter should continue to require a vote of the electorate to dispose of Utility property, the concept of management audits, and whether or not the Charter should include terms and conditions that competing electric providers would be required to meet if retail wheeling materializes and they begin selling electricity in the City of Ft. Collins. Staff intends to have an outline of a conceptual proposal drafted by the next meeting. If there is agreement by the Board on the items that are included, this outline will be forwarded to Council and the Charter Review Committee for review. This outline will not include any charter language. A lot of work will have to be done by the City Attorney's office to come up with the appropriate charter language, and we don't want to ask them to start on this until there is agreement on a concept. Board Member Rutstein mentioned that any recommendation the Board forwards to the Charter Review Committee should be as complete, direct, and clear as possible. The more work the Electric Board can do to eliminate ambiguity and to develop the proposed concept, the better. Staff will also be conducting personal interviews with the Mayor, City and/or General Manager, and Board Chair of five or six of the utilities we are researching to gain additional information on their experiences, and to find out what works, what doesn't, etc. The interviews will be based on the questionnaire that was provided in Board packets. Board Members discussed the content of the questionnaire, and provided feedback to staff. Once the interviews have been completed, the information obtained will be summarized and forwarded to the Board. -3- 00M;7 IZ•1.7110 1. Telecommunications Update: Eric provided a brief update on what is happening with telecommunications. He reviewed several issues that are of concern to the Utility, including: The Telecommunications Act of 1996, and Colorado Senate Bills 10 and 187 are pending. At this point, we do not know how these will affect the Utility. Staff will continue with research on these issues, and will work with the City's legal staff to do any necessary lobbying, etc. Feelings within the Community on whether or not the Utility should be involved in the telecommunications business are split. City Council favors community access to technologies and encourages efforts that would expand the City's infrastructure, etc. However, the Telecommunications Board is not in full agreement with this approach. There is some feeling that the Utility and other City departments should not be involved in these activities since there are private providers for these types of services. Others feel it is desirable to minimize related construction, street cutting, etc., and feel that it would be beneficial to have the City provide the communications lines to serve the various users and service providers in the Community. Staff intends to continue to explore all options that might be available for the City and the Utility. IMM717MMI There are two possible pilot projects that staff is exploring. 1. Water/Wastewater Department. The Water/Wastewater Department has two facilities on the west side of town and are having trouble with the accuracy of the information being obtained over communication systems available from the local provider. These communication problems could be improved by utilizing fiberoptic technology. The Utility could get involved by adding the necessary conduit and laying the fiberoptic cable. 2. Poudre Valley Hospital is planning to build a new facility and has requested assistance from the Utility to install fiberoptic lines. The City's Water/Wastewater facility is noncontroversial and falls well within the City's authority. However, the Poudre Valley Hospital project could be controversial. There is some concern from competitors that we are encroaching on their business. Staff intends to continue to exploring these opportunities. lI A system design consultant has. been hired to do a feasibility study for the Utility to determine whether or not it makes sense for the Utility to get involved in the telecommunications business. He will be arriving on April 1. The Telecommunications Policy is scheduled to be discussed with Council on March 26. Staff will provide Board Members with updates on these issues on a regular basis. 2. 1997 Budget -- Financial Policies Ellen reviewed the proposed change that is being suggested to Light and Power's portion of the Financial and Management Policies which is to replace the current Mission Statement with the one that was developed as part of the Strategic Planning Process. Other than this, the current policies are working well and no other changes are being recommended. Board Member Loomans made a motion to replace the existing Mission Statement with the Mission Statement that was developed by the Strategic Planning Team. Board Member Rutstein seconded the motion. The motion passed unanimously. INFORMATION REQUESTS: None. OTHER BUSINESS: Colorado Clean Energy Tour Board Member Loomans mentioned that the Land and Water Fund of the Rockies and Clean Energy Alliance of Colorado are hosting a Colorado Clean Energy Tour. A meeting for local utility representatives, business leaders and elected officials is scheduled for April 10, from 4:00 - 5:30 p.m. at the Lincoln Center, Board Member Loomans has additional information for anyone who is interested. 2. Board Member Rutstein reported that she attended a Poudre Fire Authority board meeting. The Board is made up of people from the County, as well as City Council Members. Their budget is approved by City Council, as is their mil levy. PFA can appropriate unused funds up to a certain amount, and can own property. She would not recommend this particular composition for an independent electric board. 6. AGENDA: Governance -5- Adjournment: The meeting adjourned at 7:20 p.m. i Del Coldiron, Board Secretary u