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HomeMy WebLinkAbout2015-10-29 RMLD Board of Commissioners Minutes*OF Town of Reading Meeting Minutes Board - Committee - Commission - Council: RMLD Board of Commissioners Date: 10/29/2015 Time: 07:30 PM TOWN CLERK ft READING. MASS. 161b it —S A 4 461 Building: Reading Municipal Light Building Location: Winfred Spurr Audio Visual Room Address: 230 Ash Street Session: Open Session Purpose: Regular Meeting, general business. Version: Final Attendees: Members - Present: Commissioners: Thomas O'Rourke, Chairman David Talbot, Vice Chairman - Secretary Pro Tem Philip B. Pacino, Commissioner John Stempeck, Commissioner Dave Hennessy, Commissioner Members - Not Present: Others Present: Staff: Coleen O'Brien, General Manager - Absent Hamid Jaffari, Director of Engineering &Operations Jeanne Foti, Executive Assistant Bob Fournier, Accounting /Business Manager Jane Parenteau, Director Integrated Resources Citizens' Advisory Board: Dave Nelson, Vice Chair Guests: Karen Snow, Melanson Heath Zackary Fentross, Melanson Heath Minutes Respectfully Submitted By: Thomas O'Rourke Topics of Discussion: Start Time of Regular Session: 7:62 p.m. End Time of Regular Session: 9:30 p.m. Call Meeting to Order Chairman O'Rourke called the meeting to order and stated that the meeting was being videotaped; it is live in Reading only. Opening Remarks Chairman O'Rourke read the RMLD Board of Commissioners Code of Conduct. Introductions Chairman O'Rourke stated that Mr. Jaffari, Director of Engineenng &Operations will be representing the General Manager this evening because Ms. O'Brien is out of town. Chairman O'Rourke said that Dave Talbot will be the Secretary. Page I 1 RMLD Citizens' Advisory Board Chairman O'Rourke acknowledged Mr. Dave Nelson representing the CAB this evening. Report of the Committee Audit Committee — Commissioner Pacino Mr. Pacino stated that the Audit Committee met this evening prior to the Board Meeting and reviewed the Audit, both the Town of Reading Audit Committee and the RMLD Board Audit Committee met in joint session. The audit was reviewed and both committees recommend that the Audit be accepted by the RMLD Board of Commissioners. The Town of Reading Audit Committee was a vote of 4:0 and the RMLD Audit Committee was a vote of 2:0. At this point, Mr. Pacino turned it over to Ms. Karen Snow of Melanson Health to make a presentation. Presentation (Attachment 1) Presentation of Fiscal Year 2015 Audit Melanson Heath & PC — Karen Snow and Zackary Fentross Ms. Karen Snow introduced herself as the manager of the RMLD Audit. Ms. Snow explained that she will go through the Financial Statement very briefly. Ms. Snow began with the Independent Auditor's Reports this is where Melanson Health gives their opinion on the Financial Statements noting their opinion is an "unqualified opinion." Ms. Snow stated that, in their opinion the Financial Statements are fairly stated in accordance with generally accepted accounting principles. Ms. Snow noted she will skip over the Management's Discussion and Analysis which is a narrative overview of the Financial Statements for the year and proceed to the Financial Statements, the Statement of Net Position, As Ms. Snow continued, she pointed out a couple of changes this year because it is the first year of implementation for the "Governmental Accounting Standard for the Statement Number 68 ", which requires Reading Municipal Light Department (all municipalities) to recognize their portion of the Reading Contributory Retirement Systems Unfunded Pension Liability. Ms. Snow explained that Reading's portion of that under Net Pension Liability $4,524,000 represents RMLD's share of the Town's Retirement System's unfunded portion of the Pension Liability, which is recognized for the first time in Fiscal Year 2015 on the Financial Statements. Going forward that number will be on the Statements annually going forward. The second new Rem on the Statements is under the Asset section which is called "Preferred Outflow of Resources" and this is deferring recognition of what would normally be recorded as Pension Expense under GASB Statement Number 6B. This requires recognition of the Pension Expense based on when that Net Pension Liability is measured. Since the measurement data for that Pension Liability differs from the Financial Statement date it is December 31, 2014, but for December 31, 2015 then recognition must be deferred of that Pension Expense and rolled back to last year's recognizing Pension Expense for what you contributed to Retirement for Pension Fund last year. It is a very complicated calculation and it is something you will recognize that Pension Expense going forward next year. In Fiscal Year (FY) 2015, RMLD actually recognized Pension Expense of $833,000 which for the first time is differerd from what you would normally recognize R; you would normally recognize this contribution to the Pension Trust as your Pension Expense for the year. The measurement of the Net Pension Liability other calculations go into that Pension Expense. Ms. Snow stated that going forward there may be changes in your operating results for the Net Income for the year based on how the Net Pension Liability changes from one year to another to the next. The biggest factor is in that Net Pension Liability change other than all the complicated factors that go into an actuarial valuation to calculate that including mortality and how many retirees you have and how long are retired. This is a performance of the assets of the retirement system trust in Reading Municipal Light Department's Retirement Trust. Ms. Snow said that if there are large swings in market conditions, with interest rates going up or down then the net Pension Liability will respond and react accordingly. Ms. Snow pointed out that the WILD will have to recognize those changes going toward, this is different this year than in the past. Ms. Snow then explained the OPEB, the Other Posted Funded Benefits Liability, RMLD does not have an Unfunded Liability at this point because Reading Municipal Light Department contributes to an OPEB Trust Fund. Annually, the RMLD contributes what is required to be considered fully funded. This will change in two years in 2017. Right now, RMLD is required to fund that OPEB Liability for thirty years, but in two years the rules will be changed requiring RMLD to recognize the full OPEB Liability all at once. The RMLD will have another large liability that will be on this balance sheet and it will not be able to spread out over thirty years as in the past. Ms. Snow continued, it is a recognition issue on the statement of net position operating. There are two big changes that are happening one this year and one a couple years down the road. Having said that, Ms. Snow stated, RMLD is in good shape, the Net Pension Liability is $4.5 million, it would be higher, but it has been satisfied significant amount of assets in the Pension Trust which reduces that liability. Ms. Snow stated that there have been good decisions made to help fund that liability. The RMLD Is in better shape because it already has a Pension Trust in place. The same thing holds true with the OPEB Trust, if RMLD did not have those assets set aside, RMLD would not be in as good of shape. Ms. Snow explained the Income Statement, statement of net position, RMLD's Operating Income for the year is about $4.6 million. This is reflective of a healthy Operating Income, the bottom line change in net position after the Non Operating Expenses and Revenues are factored is $3.2 million, even with recognizing the GASB Statement 68 Pension Liability there is enough Operating Income, it was a solid year. The Operating Revenues are up about 5.4 %, the Operating Expenses were up about 1.3 %, the Operating Income was down a little. This is due to higher Operating Expenses due to being proactive about maintenance and program reliability. Purchase Power is the biggest operating expense that fluctuates based on the cost of power for what it casts to Purchase Power on the market, but overall $3.2 million of Net Income is a good solid year. Page 1 2 Presentation (Attachment 1) Presentation of Fiscal Year 2015 Audit Melanson Heath & PC — Karen Snow and Zackary Fentross Chairman O'Rourke stated that he wanted to acknowledge that Mr. Zackary Fentross is also here from Melanson Health. Ms. Snow introduced Mr. Fentross as her Supervisor on the RMLD Audit. Mr. Pacino stated that the Audit Committee discussed that there will be no management letter, thus there will be no deficiencies in terms of control. There are several questions in different areas where the auditors do look at the internal controls. The auditors have been satisfied within the areas in which they have been looking. Them was an in depth discussion on the Unfunded Pension Liability as to our ability to keep that going and try to fund that depending on the resources. Chairman O'Rourke added that funding the pension is a RMLD issue as well as a Town of Reading issue. Ms. Snow added that the Town of Reading unfunded balance is $29 million in which RMLD is twenty eight percent of that. This is scheduled to be fully funded by 2028. Chairman O'Rourke thanked Ms. Snow and her staff for their input and work for the Audit. Ms. Snow commented that RMLD makes their job easy for them because they are always ready for Melanson and Heath, more than willing to assist in a quick and timely fashion. Mr. Pacino made a motion seconded by Mr. Hennessy that the RMLD Board of Commissioners accept the Audit for the Fiscal Year ended June 30, 2015, as presented by Melanson Heath. Motion carried 5:0:0. Policy Committee Meeting — Commissioner Pacino RMLD Policy 11 Revision 2 Summer Employees (Attachment 2) Note: The Policy Committee voted to remove this policy at its meeting on October 20, 2015. Mr. Pacino stated that the Policy Committee met last week and worked on three policies and is presenting two this evening. Policy 11, Revision 2, Summer Employees was discussed because RMLD no longer has summer employees and there is no anticipation of having summer employees. Policy 11, Summer Employees was established back in the 1980'x. The Policy Committee voted to recommend that the RMLD Board of Commissioners be totally removed from the Policy 11, Summer Employees and be rescinded, at this point. Mr. Pacino stated that the other policy discussed was RMLD Policy 12, Revision 2, Board Documents Dissemination with the changes are included in the packet. The Policy Committee recommends that the RMLD Board of Commissioners accept the changes and approve as presented. Mr. Talbot asked what the former Summer Employee Program entailed. Mr. Pacino explained that the Summer Employee Program grew out of the 1980's. Originally, RMLD would hire college students to come in to put markers and reflectors on poles, etc. At that time, the Commissioners put this policy in the place so there would be no potential patronage. Mr. Talbot stated that the policy is about patronage, not about banning summer employees. Chairman O'Rourke stated that the real driver for the Policy Committee asking for this policy to be removed is it had not been accessed or utilized in fifteen years. Mr. Talbot asked if this means RMLD is not open to having college kids. Ms. Parenteau answered that RMLD does have Co -op Students that are within the budget this year that is Board approved. Ms. Parenteau stated that for succession planning is to get more Co-op students. Chairman O'Rourke staled that this is an Internship Program for College students. Mr. Talbot stated that he sees value in college students' work for the summer and there are many programs RMLD needs to promote. Chairman O'Rourke stated that to Ms. Parenteau's point, as with any company the utilization with internships is great for succession planning, for bringing in new talent, etc. Mr. Talbot said that by rescinding the policy he hopes that it will not diminish internships. Mr. Pacino stated that hiring summer students is an operational issue, not a Board issue. Mr. Pacino made a motion seconded by Mr. Stempeck that RMLD Policy 11, Revision 2 Summer Employees be rescinded. Motion carried 5:0:0. RMLD Policy 12 Revision 2 Board Documents Dissemination Mr. Pacino made a motion seconded by Mr. Stempeck to move that RMLD Policy 12, Revision 2, Board Documents Dissemination be adopted, as presented. Motion carried 5:0:0. General Manager Committee— Chairman O'Rourke Review of RMLD General Manager Chairman O'Rourke stated that to provide a brief history, as with all positions, Ms. Coleen O'Brien, RMLD General Manager, is entitled to a performance review and a salary merit consideration annually. Whatever we decide upon this evening is effective back to July, which is her review date. Chairman O'Rourke stated that the process involves a General Manager Review Committee, this year consisted of himself, Commissioners Stempeck and Pacino. They have a very detailed performance review criteria in it which outlined several areas for consideration mainly Safety, Reliability, Leadership also relations with the Community, the CAB and the RMLD Board. Page 13 General Manager Committee — Chairman O'Rourke Review of RMLD General Manager Continuing, Chairman O'Rourke added that part of the process for each of us, including the non committee members, was to come up with a score. This includes rating all of the various sub categories within each of those headings with a total score of 96.6 %, which represents the average ratings of all five Commissioners. This translates into the General Managers recommended merit increase. Chairman O'Rourke slated that from the Board's perspective, they have been very pleased with all this past years performance a number of successes and accomplishments that have been produced. There has been no audit findings. Ms. O'Brien has been responsible for reformatting the financials, which has been a huge task that allows for transparency that has been discussed at previous audit meeting; she also helped obtain a $250,000 LED Grant, recommended rebates to the customers and other green initiatives to the towns in our service area. RMLD has also had two significant studies, the Organizational Study and the Reliability Study, both not only approved, but implementation plans in place. Chairman O'Rourke added that a really significant development this year, which is part of the Organizational Study, is having formal Career Development Plans for each of the job descriptions and that is really key for retention, success and overall productivity at RMLD. Chairman O'Rourke noted that Ms. O'Brien launched eight comprehensive system maintenance programs; there has been no grievances or issues with respective to labor disputes. Chairman O'Rourke added that Ms. O'Brien has provide a real leadership role in terms of the compliance of regulatory side of this business, which is very important. The Board relationships are better now that we have with Ms. O'Brien and staff. Chairman O'Rourke stated that this leads up to the General Managers Committee's recommendation and as mentioned earlier its formula, of the 96.6 %, she is entitled to an increase that is made up of the CPI, which Mr. Fournier will calculate specifically somewhere in the 1.3% to 1.7% range, but will go back to the date of her review, plus 2% which translates into a 3% plus merit that is one piece. Contractually, based on the performance and the evaluation of the Board, Ms. O'Brien is also eligible for a consideration for a one time performance incentive. Ms. O'Brien has also outlined in detail over $1.5 million hard and soft cost savings for RMLD during this performance year. Therefore, the Board would also like to recommend a 3% one -time payment, which would go into her ICMA Retirement Account which is part of her review and salary consideration. Chairman O'Rourke asked for comments and input. Mr. Nelson, as a CAB member, commented that Ms. O'Brien and her team has done a great job moving RMLD forward. Mr. Nelson stated that he was looking at FY 2015 accomplishments and memorandum that Ms. O'Brien distributed. Mr. Nelson added that is a lot of work. Having been a CAB member for three years, has been a part of a lot of this has seen how Ms. O'Brien and her team operates, they have done an excellent job. Mr. Nelson said that he RMLD is going well and agrees with everything Chairman O'Rourke has stated. Mr. Stempeck staled that he would echo what Chairman O'Rourke and CAS member Dave Nelson both stated. Mr. Stempeck wanted to add that Ms. O'Brien has done a superb job to continually efforts to raise the level of professionalism of the entire organizational, that is not an easy task to do in any organization and he commends her. Mr. Hennessy stated that what he noticed although he is the newer Board member, Ms. O'Brien and the staff are willing to shine the lights on the problems that need to be fixed and addressed. They do not shy away from uncovering those things and tackling them with vigor. He also agrees with what everyone said. Chairman O'Rourke asked Mr. Jetted to share these comments of appreciation with Ms. O'Brien. Mr. Jellied Ms. O'Brien has asked to extend her appreciation and gratitude to the Board members for a good performance evaluation and the process, as well. Mr. Pacino said that he also agrees with everything that has been said and Ms. O'Brien is hitting the problem areas. Mr. Pacino stated that his advice to her is keep going there is more to be accomplished. Mr. Jetted commented that on behalf of Ms. O'Brien appreciates the support. Mr. Talbot said that long term we will see the benefits of the grid modernization are that will provide good technical geography of the grid. Mr. Talbot added that there will be more opportunities for savings and reduction in costs with RMLD having the ability to control the peak. This work is long needed and being done. Mr. Talbot added that community solar will begin in Wilmington which has been spoken about for years. Mr. Pacino made a motion seconded by Mr. Stempeck to move that effective July 1, 2015 that the RMLD Board of Commissioners raise the salary of the General Manager to include an increase in CPI plus two percent and an additional three percent to go into the ICMA Fund. Motion carried 5:0:0. Approval of Board Minutes June 12, 2014, November 6, 2014, January 29, 2015 Mr. Pacino made a motion seconded by Mr. Stempeck to approve the Regular Session meeting minutes of June 12, 2014, November 6, 2014 and January 29, 2015, as presented. Motion carried 4:0:1. Mr. Hennessy abstained. Page 14 Approval of Board Minutes March 25, 2015, May 14, 2015 Mr. Pacino made a motion seconded by Mr. Stempeck to move approve the Regular Session meeting minutes March 26, 2015 and May 14, 2015, as presented. Motion carried 5:0:0. General Manager's Report Mr. Jaffad reported on the RMLD Annual Report noting that this is the first year the RMLD Annual Report will be all electronic, it will be available on the RMLD website. For people who do not have electronic accessibility, there will be a few printed copies available in the lobby as well as a few copies at the Town of Reading Subsequent Town Meeting. Also, for the first time the Annual Report was performed completely in -house including the art work. The savings are approximately $9,700 representing $7,000 for the cost of producing the report and $2,700 for the avoided cost on paper production. Mr. Jaffad reported that the Town of Reading Subsequent Town Meeting is scheduled for Monday, November 9, 2015 at 7:30 p.m. Ms. O'Brien will be presenting the highlights of Fiscal Year 2015 with the theme being Peak Performance which will last approximately fifteen minutes. Ms. O'Brien has also met with two Town Managers and one of the Town Administrators to schedule the Selectmen updates. Ms. O'Brien has one more Town Administrator to meet with which is scheduled for early November. RMLD performs twice a year. Mr. Pacino suggested that relative to the Town Meeting presentation, it would be great to have the link to RMLD Annual Report available on overhead. Mr. Jaffari agreed it is a good idea. Power Supply Report — August and September 2015 — Ms. Parenteau (Attachment 3) Ms. Parenteau reported on the Power Supply Report for August and September 2015. Ms. Parenteau showed the energy purchases versus sales for the month of August 2015 looking back to 2013, 2014 and 2015 that reflect both the purchases and the sales. It is noteworthy to point out that there is a lag in sales due the billing cycles. August sales reflect half of July and half of August depending upon when the cycles fall. Sales fluctuate based on the weather. Ms. Parenteau stated that this past 2015, RMLD purchases were up approximately ten percent of what was purchases on the wholesale side 2014 versus 2015 it was a very good summer in terms of sales and purchases which was weather related. Ms. Parenteau then addressed the energy cost versus the Fuel Charge Adjustment noting that the RMLD has a Deferred Cash Reserve that is used to stabilize pricing in order to mitigate spikes to the customers. Ms. Parenteau said that as stated at the last meeting, the overall Fuel Charge has dropped when compared from one fiscal year to the other which is a pass through to the customers who receive those savings. The next graph looks at the month of August's peak demand, which was up from last year. Purchases went up ten percent, with the peak of 153.225 megawatts. RMLD's all -time peak occurred in 2006 which was 170 megawatts. The peak is down substantially when compared to the all -time peak which is related to the economy, weather and the customer base as well as efficiency measures. Looking at the data for September, it was a good month for sales, due to the first two weeks in September being considerably hot. There were more cooling degrees in 2015 - 164 days, than in 2014 —120 days. The weather is a driving factor for electricity sales, purchases and peak demand. The transmission costs are going up on average six to ten percent annually. The RMLD is part of the Independent System Operator New England's grid, all the transmission costs are socialized throughout the six New England states. Ms. Parenteau stated that the only thing RMLD can do to manage these costs is by managing its monthly peak demand. All of RMLD's Rebate Programs are structured and designed to incentivize peak reduction. Hopefully, that will help levelize the peak. Additionally, capacity charges will be increasing significantly. Ms. Parenteau stated that Ms. O'Brien wanted to inform the Board that she is scheduling meetings for the four town Board of Selectmen to speak about rates as well as the effect of the change in the capacity which is forecasted to increase significantly in 2017. The RMLD has unbundled rates to show the capacity and transmission on a stand alone line versus the energy which is a pass through to our customers, but there will be significant increases. Ms. Parenteau stated that part of the financial process is that they look at a six year plan, based on the current six year plan it looks like a seven to nine percent overall increase for our customers. The numbers will be fine -tuned when we begin our FY 2017 budget process early January or February 2017. Ms. Parenteau said that Ms. O'Brien plans to inform the Town Administrators/Managers so that they can input that information into their town budgets. Mr. Stempeck asked Ms. Parenteau when that data is presented is it possible to compare it with National Grid or Ever Source, if so, it will be would be very helpful. Ms. Parenteau agreed, yes. However, 4 is difficult for people to understand because when they are accustomed to having stable costs with no comparisons, it looks extremely high. However, when this is put into context with what other towns are paying that are not municipally owned there are significant savings. Chairman O'Rourke stated that he assumes the Board would get a preview first of the rate increase. Ms. Parenteau explained this information is usually ready by March 31. Staff then meets with the CAB in April, followed by Board and the rate is effective by July 1. There will be discussions. Page 15 Power Supply Report —August and September 2015— Ms. Parenteau (Attachment 3) Mr. Talbot asked what was the day of week was the peak 153? Ms. Parenteau believed it was a Tuesday in August. Mr. Talbot asked if a plan was activated that day to try knock that peak back, was there a communications plan. Ms. Parenteau explained that there is a Peak Demand Reduction Program, commercial customers that were signed up for that program were notified resulting in approximately a little less than one megawatt worth of reduction. The tricky part with this Peak Demand Reduction Program that it is not automated and requires people to do things. Historically, there has been reluctance because costs are currently low. Costs will be increasing significantly from the standpoint of capacity and transmission and those savings will be passed on to the customers. RMLD is fine tuning the program to educate our customers in order that they can we the actual savings which gets reduced directly to their bill. Mr. Talbot inquired if during the morning of the peak, was there an awareness that it might be the day for load reduction. Ms. Parenteau stated that there were several days during the month. Several events are forecasted because there is no way to know exactly the day /hour. During the July, August period there was probably six to ten days that we called for peak reduction. Mr. Talbot questioned whether RMLD was developing a mass communications plan out to all customers every day, not to just the large customers. Ms. Parenteau explained that the issue is RMLD wants to educate its customers. RMLD is trying to develop a campaign for customers to understand why they are conserving energy as well as the associated benefits. Ms. Parenteau reported that the RMLD Customer Service Group has done a fantastic job; there are over 16,000 customer e-mail addresses secured. The RMLD is actually in the process of filling a position who will be responsible for sending these a -mails out. Mr. Talbot asked why RMLD is not on social media to alert the various groups of people who are on Facebook pages or Twitter since this is the way everybody gets information now, it shows up on their Smartphone, it happens right away. RMLD does not communication on Facebook or Tweet? Mr. Jaffari replied, no RMLD is not currently on Facebook or Twitter. Mr. Talbot asked if there is a reason why RMLD is not on social media. Ms. Parenteau staled that RMLD has met with other municipalities who have used Facebook and Twitter. Shrewsbury is a good example, they are very active on Facebook and Twitter. Ms. Parenteau said that based on Ms. O'Brien's experience in Danvers, these modes of communication were available Monday through Friday it works well. However, on the weekend if you don't have the correct person assigned to that task and an event occurs, people's expectations are they will be looking to their Twitter accounts, the utility does not have the resources internally to handle this, 9 becomes problematic. Mr. Talbot stated that the peaks will always happen on business days. Ms. Parenteau agreed, yes the peak, but people use Twitter for outages, it is a whole communication plan, not just for peak reduction program. Mr. Talbot suggested using at least Twitter for the peak. Ms. Parenteau agreed to discuss it further with Ms. O'Brien. Mr. Jaffari stated that this is part of the roadmap for grid modernization that RMLD will have Interactive Voice Response which provides more capabilities to reach out to the customers. IVR is when customers can receive text or voice mail when they are subscribed and signed up. Mr. Jaffari stated that his own experience from Danvers when they tried Twitter was at the beginning there was interest up front then it dissipated to nothing. Mr. Jaffari stated that RMLD can look into it although he believes receiving a -mails is more productive. Chairman O'Rourke suggested that the staff bring this back to Ms. O'Brien to discuss the concems discussed about social media. Engineering and Operations Report — August and September 2015— Mr. Jaffari (Attachment 4) Mr. Jaffari presented the Engineering and Operations Report for August and September 2015. Mr. Jaffari reported on the Construction Projects — The Pole Line Upgrades on Lowell Street, Wilmington is 82% completed; Upgrade Lynnfeld Center Cook's Famr 75% completed; 4W5-4W6 Tie Reading is 5% completed; West Street Pole Line Upgrade state funded project 95% completed. Mr. Jaffari continued reporting on with Special Projects and Capital Purchases noting the LED Streetlight Conversion is going very well. RMLD has replaced and 672 of the 2,450 LED lights targeted for FY 2016, as of October 11, 2015. Routine Construction for the month of August, RMLD spent $116,575 and in September $141,727, year - to-date $368,276. Routine Maintenance, Mr. Jaffari reported that under Transformer Replacement Program, up -lo -date, approximately 13.31 %of Padmount Transformers and 10.54% of Overhead Transformers are replaced; for Pole Line Inspection program 640 poles were inspected in FY 2015 and FY 2016 which 213 poles tagged, 22 condemned, 123 poles have been replaced (67 out of the 123 transfers have been completed) with 90 poles remaining. There are 502 double poles throughout the system, Lynnfield 41, Reading 135, North Reading 127 and Wilmington 199. The Visual Inspection of the Overhead Lines, which is another Maintenance Program, inspected circuits are as follows: 5W8, 5W9, 5W5, 4W10, 5W4, 4W28, 4W5, 4W6, 3W8, 3W18, 4W13 these are the circuits that were patrolled and no problems were found. Mr. Jaffari continued with Routine Maintenance slating the Manhole Inspections is ongoing, however, the main roads inspection is pending. Page 1 6 Engineering and Operations Report — August and September 2015 — Mr. Jaffari (Attachment 4) The Porcelain Cutout Replacements includes 90% completed with 270 remaining to be replaced; Mr. Jaffari stated that the Tree Trimming is going very well, in August 288 spans were done, in September there were 320, year -to -date 925 spans are trimmed. The Substation Maintenance program includes infrared scanning, which for the months of August and September did not show any major trouble or problems in RMLD's substations Mr. Jaffari discussed the Reliability Report which exceeds the regional and local indices because of the stone activity on August 4 and August 5, 2015 in which there were approximately 3,000 customers out for an extended amount of time and that is very unusual. Mr. Jaffari reported that some of these customers were without power for close to twenty two hours that is what drove the numbers above the regional and national averages. The System Average Interruption Duration Index (SAIDI) and the Customer Average Interruption Duration Index (CAIDI) were also above the averages due to the storm. Mr. Stempeck asked if most of the outage causes for the stone were due to trees. Mr. Jaffari responded down trees brought down three circuits in Lynnfield causing outages in both Reading 8 Lynnfield. There was not much going on in Reading or Wilmington. As fares the System Average Interruption Frequency Index (SAIFI), it was below the regional and national averages. Most of the outages for the past five years were due to trees, breakdown of the equipment and wildlife. RMLD now has programs in place to make sure that these outage causes remain under control. The tree trimming that has been revamped by cutting back to eight feet from energized lines, installing more wildlife apparatus to cover both overhead exposed energized equipment. Mr. Talbot stated that he was very interested in the intelligence RMLD will be adding to the grid to the have the ability to communicate better with individual pieces of equipment. Will RMLD be able to see if the equipment is ready to fail prior to failing and asked if that is one of the goals? Mr. Jaffad answered yes, and explained that the first two smart switches have been already installed and will be on the SCADA Program soon. By using this technology, RMLD will be able to see if there is any trouble. Based on this technology, control authorities and dispatchers will receive a report and will be alarmed to a either a pager or Smart Phone. This technology allows you to pinpoint the troubled area faster and isolate the troubled area fairly quick. Mr. Jaffari noted, that there is another feature of the Smart Grid that is called Fault Detection Isolation and Recovery (FDIR), once the entire automation infrastructure is in place, if something fails the fault is automatically isolated. The switch automatically opens up before and after the fault and everything else dosed back to the open points within seconds. Right now, it takes hours to restore power to outaged areas. This technology once in place will decrease the number of truck rolls, which increases operational saving costs. Mr. Talbot stated that he had an opportunity to interview Harold DePriest, the person who runs the Chattanooga Electric Utility, which is one of the best Smart Grids in the nation. Mr. Talbot noted that Chattanooga Electrical Utility has gains that came from this Smart Grid that even Mr. DePriest did not anticipate such as eliminating $5 million in overtime expenses. Mr. Talbot said that Mr. DePriest can schedule the failing equipment in advance during the week rather than waiting for it to fail during off hours or performing the work on overtime. Mr. Jaffari stated they have close to two thousand of these type of switches, they use the same technology that we have installed. Mr. Talbot said that the payback on this is huge. Financial Update — Mr. Fournier Mr. Fournier reported that he had been waiting for the audit to be approved prior to completing his Financial Statements, they are completed. Mr. Fournier provided the results of the first quarter ending on September 30, 2015. The Net Income is $1.9 million, which is approximately $400,000 over budget or 25 0/6. The RMLD is off to a strong start. Comparing the first three months of this year versus last year's aduals, kilowatt hour sales are up about $7.5 million or about 3.9 %, base revenues are up $688,000 or 11.3% all good news. On the expense side, expenses are down about $650,000 or 11% based on the five divisions. Mr. Fournier stated that the cash position is still very strong. The new Fiscal Year is off to a solid start. The reports are completed and will get those reports out to the RMLD Board of Commissioners by next week. MGL Chapter 30B Bid (Attachment 5) IFB 2016 -03 - Remediation, Transportation, and Disposal of Hazardous Waste Mr. Jaffari explained that this bid is for transportation and disposal of hazardous waste material. The RMLD had three bidders with the lowest bidder being ENPRO for $150,000. One of the bidders was disqualified because of not meeting the requirements therefore were two qualified bidders and ENPRO was the lowest. That price is a good value for disposal and transportation of hazardous material. Mr. Pacino made a motion seconded by Mr. Stempeck that bid 2016 -03 for Remediation, Transportation, and Disposal of Hazardous Waste be awarded to ENPRO for a three year period ending November 30, 2018 for an estimated cost of $150,000 as the lowest qualified bidder on the recommendation of the General Manager. Motion carried 5:0:0. General Discussion Mr. Pacino attended the last CAB meeting in which there was a Lighting Program presentation made by Tirzah Shakespeare and Rahul Shah, from the Integrated Resource Department. Page 1 7 General Discussion Mr. Pacino thought it was a very good presentation and he recommended the same presentation be made to the RMLD Board. Ms. Parenteau explained that Ms. Shakespeare and Mr. Shah work with Tom 011ila on the commercial customer side with the Commercial Lighting Program and will follow -up on arranging the presentation to be made to the RMLD Board of Commissioners. Mr. Pacino noted that Ms. Gottwald attended the CAB meeting and updated them on what is going on with Public Relations. Chairman O'Rourke mentioned the Public Power Week Open House was held at RMLD in October was very successful, he had a chance to stop by. Chairman O'Rourke stated that it was well showcased by RMLD employees that covered aspects of the services RMLD provides to its customers. It was nice to meet the Linemen and the other RMLD employees. Mr. Talbot stated that at the last meeting, Chairman O'Rourke mentioned relative to RMLD's fiber, to seek a rough idea of what is possible for the RMLD fiber from a business perspective. There are a number of companies that will perform these analyses for not a large amount of money. Continuing, Mr. Talbot stated, at this point wanted to get a sense from the Board if this is something we should put on the agenda to discuss at the next meeting in terms of should the Board figure out if we want to ask for a company to be hired, to answer basic questions such as what is our asset, how could It be monetized, what might the market opportunities backhaul to call towers etc. What is the sense of the Board? Chairman O'Rourke stated that at one of the last meetings it was discussed that we were in favor of obtaining some data because none of the commission members had any expertise in fiber. If there is any information Mr. Talbot could put together for discussion that would be helpful. Mr. Stempeck agreed to an independent analysis. Mr. Jaffari stated that there is a committee being set up from NEPPA on fiber. Other communities are getting involved, as well. Mr. Talbot said that it would be good if that committee could move forward. Mr. Stempeck asked if Ms. O'Brien received any feedback from the poll she sent out on the fiber topic. Mr. Jaffan stated that Ms. O'Brien spoke with Reading and there was not much saving for them because they already have a deal with Verizon or Comcast. Mr. Jattan is unclear about the other towns. BOARD MATERIAL AVAILABLE BUT NOT DISCUSSED E -Mail responses to Account Payable /Payroll Questions Rate Comparisons, October 2015 RMLD Board Meetinas Thursday, December 10, 2015 Town of Reading — Subsequent Town Meeting Town of Reading — Subsequent Town Meeting — November 9, 2015 Policy Committee Meeting To Be Determined. CAB Meeting Wednesday, November 18, 2015, Dave Hennessy will attend. Executive Session Al 8:55 p.m. Mr. Pacino made a motion seconded by Mr. Stempeck that the Board go into Executive Session to approve the Executive Session meeting minutes of June 12, 2014 and January 29, 2015, discuss strategy with respect to collective bargaining, and return to Regular Session for the sole purpose of adjournment. Chairman O'Rourke called for a poll of the vote: Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye and Mr. Hennessy; Aye. Motion carried 5:0:0. Adjournment At 9:30 p.m. Mr. Pecino made a motion seconded by Mr. Stempeck to adjourn the Regular Session. Motion carried 5:0:0. A true copy of the RMLD Board of Commissioners minutes as approved by a majority of the Commission. Dave Talbot, Secretary Pro Tem RMLD Board of Commissioners Page 1 8 [30 TOWN OF READING, MASSACHUSETTS READING MUNICIPAL LIGHT DEPARTMENT Annual Financial Statements For the Year Ended June 30, Attachment 1 Reading Municipal Light Department TABLE OF CONTENTS PAGE INDEPENDENT AUDITORS' REPORT 1 MANAGEMENT'S DISCUSSION AND ANALYSIS 3 BASIC FINANCIAL STATEMENTS: Proprietary Fund: Statements of Net Position 6 Statements of Revenues, Expenses, and Ch ges in Net Position 7 Statement sh Flo s Q 8 _ucia Fu ds:D tem n of i Cia t P ition �� 9 to en of han es in Fiduciary Net Position 10 to Financial Statements 11 REQUIRED SUPPLEMENTARY INFORMATION Schedule of Funding Progress 34 Schedule of Proportionate Share of the Net Pension Liability 35 Schedule of Contributions 36 INDEPENDENT AUDITORS' REPORT To the Municipal Light Board Town of Reading Municipal Light Department Report on the Financial Statements We have audited the accompanying financial statements of the business -type activities and the aggregate remaining fund information of the Town of Readi Municipal Light Department ( "the Department ") (an enterprise fund ow of Reading, Massachusetts), as of and for the year ended 0, 2015 a the related notes to the financial statements, which ectivel i e th Department's basic financial statements,a sted in the a I�f Cont nts. Management's i'jesp sibility for or Responsibility t is sp&reible rte pr paration and fair presents - ts i acco ce it ounting principles generally f e ca; th cludes the design, implementation, levant to the preparation and fair presentation free from material misstatement, whether due to Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial state- ments are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assess- ments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by manage- ment, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the business -type activities and the aggregate remaining fund information of the Town of Reading Municipal Light Department as of June 30, 2015, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Report on Summarized Comparative Information We have previously audited the Department's fiscal year, ancial sta nts, and we expressed an unmodified audit opinion on t se audi al s atements in our report dated October 2, 2014. 1 in ion, the mmarized c mp rative information presented herein as of an forth fsca yea nde June 0, 2P14 is con- sistent, in all mat spects, with edit fin ncia ments f om hich it has been d d. D ccounti rinc'Ts generally accepted in the United States of America require anagement's Discussion and Analysis, Schedule of Funding Progress, Schedule of Proportionate Share of the Net Pension Liability, and Schedule of Contributions be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited proce- dures to the required supplementary information in accordance with auditing stand- ards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with evidence suffi- cient to express an opinion or provide any assurance. .2015 MANAGEMENT'S DISCUSSION AND ANALYSIS Within this section of the Town of Reading Municipal Light Department's ( "the Department") annual financial report, management provides a narrative discussion and analysis of the Department's financial activities for the year ended June 30, 2015. The Department's performance is discussed and analyzed within the context of the accompanying financial statements and disclosures following this section. A. OVERVIEW OF THE FINANCIAL STATEMENTS The basic financial statements include (1) the Proprietary Fund Statements of Net Position, (2) the Proprietary Fund Statements of Revenues, Expenses and Changes in Net Position, (3) the Proprietary Fund Statements of Cash Flows, (4) the Fiduciary Funds Statements of Fiduciary Net Position, (5) the Fiduciary Funds Statements of Changes in Fiduciary Net Position, and (6) Notes to Finan- cial Statements. The Proprietary Fund Statements of Net Position' gne o i icat our financial position at a specific point in ti e. At J ne 3 , i sh ws ur net worth of $101,445,083 which com ses 69,91 ,34 i ed in c Pita assets, $5,434,308 restricted precia ion fun anyExpnses�ancl 6 unre trlct d. T riet Fyrfd -$fate en oftftgven s Ch sin Net Position s m ariz r o erati g r ults an r uch, if any, of a profit as me f r the -(ear. di cusSedin,mor , our net profit for the T rloro ietabind SI—atements of Cash Flows provide information about cash reoe!Rts, cash payments, investing, and financing activities during the accounting peTiod. A review of our Proprietary Fund Statements of Cash Flows indicates that cash receipts from operating activities adequately covered our operating expenses in fiscal year 2015. The following is a summary of the Department's financial data for the current and prior fiscal years. Summary of Net Position 2015 2014 Current assets $ 23,184,226 $ 21,584,528 Noncurrent assets 93,572,180 90,733,116 Deferred outflows of resources 1,547,815 Total assets and deferred outflows of resources $ 118,304,221 $ 112,317,644 Current liabilities $ 9,330,904 $ 7,721,376 Noncurrent liabilities 7,528,234 2,722,934 Total liabilities 16,859,138 10,444,310 (continued) (continued) As Net position Net investment in capital assets 69,916,349 70,194,105 Restricted for depreciation fund 5,434,308 4,130,585 Unrestricted 26,094,426 27,548,644 Total net position 101,445,083 101,873,334 Total liabilities and net position $ 118,304,221 $ 112,317,644 Summary of Changes In Net Position Operating revenues Operating expenses Operating income Non-operating revenues (expenses) Change in net position Beginning net position, as restated Ending net position 21, not 2015 2014 $ 85,005,786 $ 84,364,480 (80,359,819) (79,294,372) 4,645,967 5,070,108 (1,404,691) (1,513,933 net for Pensions — An Amend - tary fund's comparative Electric sales (net of discounts) were $83,985,195 in fiscal year 2015, an increase of 5.4% from the prior year. In fiscal year 2015, kilowatt hours sold increased by 0.2% to 689,722,742, compared to 688,104,698 in fiscal year 2014. In fiscal year 2015, customers were charged $1,047,590 in purchase power fuel charge adjustments, compared to charges of $1,523,208 in fiscal year 2014. In fiscal year 2015, the Department restructured its rates and began billing customers purchase power capacity and transmission costs separately from the base rate. As a result of this restructuring, customer bills no longer include a pur- chase power adjustment. In fiscal year 2015, customers were credited purchase power capacity and transmission adjustments of $(26,999). Operating expenses totaled $80,359,819 in fiscal year 2015, an overall increase of 1.3% from fiscal year 2014. The largest portion of this total, $61,073,227, was for purchase power costs. Other operating expenses included $14,029,399 for general operating and maintenance costs, $1,395,728 for voluntary payments to Towns, and depreciation expense of $3,861,465. In fiscal year 2015, the depre- ciation rate was 3.0 %. In fiscal year 2015, the Department contributed $1,500,000 to the Reading Municipal Light Department Employees' Retirement Trust ( "Pension Trust") and the Pension Trust contributed $1,401,638 to the Town of Reading Contributory Retirement System on behalf of the Department's employees. In fiscal year 2015, the Department contributed $345,382 to the Other Post - Employment Benefits Trust ( "OPEB Trust"), which was equal to its actuarially determined liability at June 30, 2015. As a result, the Department had no unfunded OPEB liability at June 30, 2015. Additional information on the Department's OPEB contributions can be found in Note 16 on pages 21 -24 of this report. C. CAPITAL ASSET AND DEBT ADMINISTRATION Capital assets. Total investment in land at year end amounted to $1,265,842; there was no change from the prior year. Total investment in deprec" a ital assets at year -end amounted to $68,650,507(n et of accu depreci n), a decrease of $(277,756) from the prior year. This ecia le capital assets includes structures and improv�rgents, a hin s, and infrastructure assets. � current fisdal velar. the dill nal mfprma ' on pi I a ecs a0p -emkir­long -term liabilities can be fund in th otes to loan tements. REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the Town of Reading Municipal Light Department's finances for all those with an interest in the Department's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to: Accounting /Business Manager Town of Reading Municipal Light Department 230 Ash Street Reading, Massachusetts 01867 TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUSINESS -TYPE PROPRIETARY FUND STATEMENTS OF NET POSITION JUNE 30, 2015 AND 2014 220115 2014 ASSETS Current: Unrestricted cash and short -term investments $ 13,151,862 $ 11,533,212 Receivables, net of allowance for uncollectable 7,314,059 7,871,050 Prepaid expenses 1,137,898 772,766 Inventory 1,580,407 1,407,500 Total current assets 23,184,226 21,584,528 Noncurrent: Restricted cash and short-term investments 22,344,778 19,219 11 Restricted investments 1,284,061 2,9 Investment in associated companies 26F,221 994 4 Land 1265,842 Capital assets, net of accumulated depreciation 6 928,263 Total noncurrent assets 9 733,116 DEFERRED OUTF FRESO RCES - T TS A D D ER ED UTF W OF RESOU ES 1 112,317,644 LI BILI7 ES Cu rent abl 5,097,838 4,407,535 ed li ilitie 585,104 592,810 Ctrs rdeposita 846,361 749,900 uslomer advances for construction 889 ,774 400,656 Due to Pension Trust 1,500,000 1,374,538 Due to OPEB Trust 345,382 - Current portion of long -term liabilities: Accrued employee compensated absences 66,445 195,937 Total current liabilities 9,330,904 7,721,376 Noncurrent: Accrued employee compensated absences 3,004,043 2,722,934 Net pension liability 4,524,191 Total noncurrent liabilities 7,528,234 2,722,934 TOTAL LIABILITIES 16,859,138 10,444,310 NET POSITION Net investment in capital assets 69,916,349 70,194,105 Restricted for depreciation fund 5,434,308 4,130,585 Unrestricted 26,094,426 27,548,644 TOTAL NET POSITION $ 101,445,083 $ 101,873,334 The accompanying notes are an integral part of these financial statements. 6 TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUSINESS -TYPE PROPRIETARY FUND STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION FOR THE YEARS ENDED JUNE 30, 2015 AND 2014 The accompanying notes are an integral part of these financial statements. 7 2015 2014 Operating Revenues: Electric sales, net of discounts of $2,953,502 and $4,475,920 respectively $ 83,985,195 $ 79,689,061 Purchase power adjustments: Fuel charge adjustment 1,047,590 1,523,208 Capacity and transmission adjustment (26,999) 11 Total Operating Revenues 84 0 Operating Expenses: Purchase power 6 ,823,626 Operating 1 ,002,998 Maintenance 44,645,967 4 ,290,843 V yme is tot ns 8 ,397,270 Depreciation 5 3,779,635 otal pe ing Expe s 79,294,372 per Ling I co a ,,7 5,070,108 Nonoperat' Rev, ues(Expenses): I income 122,693 120,832 MMWEC surplus 212,689 391,726 Intergovernmental grants 62,500 - Contributions in aid of construction 64,474 24,117 Return on investment to Town of Reading (2,332,863) (2,301,221) Loss on disposal of capital assets (58,296) (114,960) Other 524,112 365,553 Total Nonoperating Revenues (Expenses), Net (1,404,691) (1,513,953) Change in Net Position 3,241,276 3,556,155 Net Position at Beginning of Year, as restated 98,203,807 98,317,179 Net Position at End of Year $ 101,445,083 $ 101,873,334 The accompanying notes are an integral part of these financial statements. 7 TOWN OF READING, MASSACHUSETTS $ 4,645,967 $ 5,070,108 MUNICIPAL LIGHT DEPARTMENT BUSINESS -TYPE PROPRIETARY FUND STATEMENTS OF CASH FLOWS 3,861,465 3,779,635 FOR THE YEARS ENDED JUNE 30, 2015 AND 2014 Accounts receivable 0 2014 Cash Flows From Ooentino Activities: (365,132) (81,321) Receipts from customers and users $ 84,638,647 $ 80,249,266 Payments to vendors and employees (76,424,486) (74,778,752) Customer purchase Power adjustments 1,020,591 4,675,419 Net Cash Provided By (Used For) Operating Activities 9,234,752 10,145,933 Cash Flows From NoncapNal Financing Activities: (519,874) - Return on investment to Town of Reading (2,332,863) (2,301,221) MMWEC surplus 212,689 91,726 Other 524,112 65,553 Net Cash Provided By (Used For) Noncapital Financing Activities /(I ,082) , 43,942) Acquisition and construction of capital assets 642,005) (3,894,282) Contributions in aid of construct' 553,592 19,619 Intergovernmental re 62500 - et Caslh -fim irked By Used or) apital nd late Fi ancin Acti ities (3,025,913) (3,874,663) Inv stme tinco a \% 122,693 120,832 (In ease) decre se in rest icte cash a rove ents (3,116,820) (2,466,799) Net C sh vid By Used or)I ing Activities (2,994,127) (2,345,967) Net Cha a in Unrestricted Cash and Short -Term Investments 1,618,650 2,381,361 shicled Cash and Short -Term Investments, Beginning of Year 11,533,212 9,151,851 Unrestricted Cash and Short-Tenn Investments, End of Year $ 13,151,862 $ 11,533,212 Reconciliation of Operating Income to Net Cash Operating income $ 4,645,967 $ 5,070,108 Adjustments to reconcile operating income to net cash provided by (used for) operating activities: Depreciation expense 3,861,465 3,779,635 (Increase) decrease in: Accounts receivable 556,991 510,327 Prepaid and other assets (365,132) (81,321) Inventory (172,907) 161,530 Accounts payable and accrued liabilities 834,214 (718,762) Due to pension trust 125,462 1,374,538 Due to other postemployment benefits trust 345,382 - Net pension liability (519,874) - Other (76,816) 49,878 Net Cash Provided By (Used For) Operating Activities $_.L234,752 $ 10,145,933 The accompanying notes are an integral part of these financial statements. 8 TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT FIDUCIARY FUNDS STATEMENTS OF FIDUCIARY NET POSITION JUNE 30, 2015 AND 2014 Pension Trust OPEB Trust 2015 2014 2015 2014 ASSETS Cash and short-tens investments $ 2,666,772 $ 2,632,367 $ 1,857,738 $ 1,846,042 Investments 1,284,061 1,292,906 - Due from proprietary fund 1,500,000 1,3 2 TOTAL ASSETS 545 5,2 ,81 2,203,1 0 1,846,042 NETP / \ Tote net n Id in st $ .450,833 $ ,2 ,81 $ 2,203,120 $ 1,846,042 The accompanying notes are an integral part of these financial statements. 41 TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT FIDUCIARY FUNDS STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION FOR THE YEARS ENDED JUNE 30, 2015 AND 2014 102,719 OPEB Trust 2015 2014 $ 345,382 $ 78 ,0t 95 696 438 350,531 357,078 350,531 Net Po Beginning of Year 5,299,811 5,197,092 1,846,042 1,495,511 Net Position, End of Year $ 5,450,833 $ 5,299,811 $ 2,203,120 $ 1,846,042 The accompanying notes are an integral part of these financial statements. 10 Pension Trust 2015 2014 Additions: Contributions from Reading Municipal Light Department $ 1,500,000 $ 1,374,538 Investment income and change in fair value 52,660 74,220 Total additions 1,552,660 1,448,7 _ Deductions: //\ Paid to Reading C niributo; 102,719 OPEB Trust 2015 2014 $ 345,382 $ 78 ,0t 95 696 438 350,531 357,078 350,531 Net Po Beginning of Year 5,299,811 5,197,092 1,846,042 1,495,511 Net Position, End of Year $ 5,450,833 $ 5,299,811 $ 2,203,120 $ 1,846,042 The accompanying notes are an integral part of these financial statements. 10 Town of Reading, Massachusetts Municipal Light Department Notes to Financial Statements Summary of Significant Accounting Policies The significant accounfing policies of the Town of Reading Municipal Light Department ( "the Department") (an enterprise fund of the Town of Reading, Massachusetts) are as follows: A. Business Activity - The Department purchases electricity for distribution to more than 25,000 customers within the towns of Reading, North Reading, Wilmington, and Lynnfield. B. Reaulation and Basis of Accounting - Under Massachusetts al aws, the Department's electric rates are set by the Mug pR fight Boar lectri rates, excluding the purchase power fuel ahergeand 'chai a power capacity and transmission cha canno be ged more tha once every three months. Rate s( edul s are sled Mass ichu efts Departure Utiliti s (RRPU Whi a the exerci s g neral supery sory ority over, he pa me r t, th Department rat s are not --girbiec to PU ppr Val. h part art's p licy is to pre re its financial Dslat m nts co rmity with general) a c ed accounting principles. Pro on tary un s cis' operating revenues and expenses from non - op rati g it ms. rating revenues and expenses generally result from vidi ervices and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the Department's proprietary fund are charges to customers for electric sales and services. Operating expenses for the Department's proprietary fund include the cost of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non - operating revenues and expenses. C. Concentrations - The Department operates within the electric utility industry. In 1998, the Commonwealth of Massachusetts enacted energy deregulation legislation that restructured the Commonwealth's electricity industry to foster competition and promote reduced electric rates. Energy deregulation created a separation between the supply and delivery por- tions of electricity service and enabled consumers to purchase their energy from a retail supplier of their choice. Municipal utilities are not currently subject to this legislation. D. Retirement Trust - The Reading Municipal Light Department Employees' Retirement Trust (the "Pension Trust ") was established by the Reading 11 Municipal Light Board on December 30, 1966, pursuant to Chapter 64 of the General Laws of the Commonwealth of Massachusetts. The Pension Trust constitutes the principal instrument of a plan estab- lished by the Municipal Light Board to fund the Department's annual required contribution to the Town of Reading Contributory Retirement System (the System), a cost sharing, multi- employer public employee retirement system. E. Other Post- Emolovment Benefits Trust - The Other Post - Employment Benefits Liability Trust Fund (the "OPEB Trust") was established by the Reading Municipal Light Board pursuant to Chapter 32B, Section 20 of the General Laws of the Commonwealth of Massachusetts. The OPEB Trust constitutes the principal instrument of a plan established by the Municipal Light Board to fund the Department's annual actu ' Ily determined OPEB contribution for future retirees. F. Revenues - Revenues are based on rate stablis t A rt ment and filed with the DPU. Rev from s les electrirded on the basis of bills r ndered f m mo thly ete adi g cycle basis a state et of dis un . Re ogn' s giamount �f sale to qustgmer whi h a eenbi ed t th end of triod. ?yCas nd Short-4 In estm - Fo tlke purposes of the Statements of Zentof De a cons rs unrestricted cash on deposit with the o b or short-term investments. For purposes of the Position, both the proprietary funds and fiduciary funds cted and restricted inve stments with original maturities of three months or less to be short-term investments. H. Investments - State and local statutes place certain limitations on the nature of deposits and investments available. Deposits in any financial institution may not exceed certain levels within the financial institution. Non - fiduciary fund investments can be made in securities issued or unconditionally guaranteed by the U.S. Government or agencies that have a maturity of one year or less from the date of purchase and repurchase agreements guaranteed by such securities with maturity dates of no more than 90 days from date of purchase. Investments for the Department and the Pension Trust consist of domestic and foreign fixed income bonds which the Department intends to hold to maturity. These investments are reported at fair market value in the propri- etary fund and fiduciary fund financial statements. I. Inventory - Inventory consists of parts and accessories purchased for use in the utility business for construction, operation, and maintenance pur- 12 poses and is stated at average cost. Meters and transformers are capi- talized when purchased. J. Capital Assets and Depreciation - Capital assets, which include property, plant, equipment, and utility plant infrastructure, are recorded at historical cost or estimated historical cost when purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of the donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Major outlays for capital assets and improvements are capitalized as they are acquired or constructed. Interest incurred during the construction phase of proprietary fund capital assets is included as part of the capitalized value of the constructed asset. When capital assets are retired, the cost "e retired asset, less accumulated depreciation, salvage vgob sh proceeds, is charged to the Department's unre Massachusetts General La ire util ty pl in ere- ciated at a minim m annua rate o 3 %. ch ge is artmef must o ' pprova from he PU. Cha ges' nuarates ay b ma fin ncia fac o rel tin to c sh flow nsion, ra er hanee ng f cto latin t esti ales of useful lives. K. Acc u C ensa d Abs noes mployee vacation leave is vested J nn al y bu m onl rried forward to the succeeding year with su ery sor ppro al and, if appropriate, within the terms of the applicable apart ent policy or union contract. Generally, sick leave may accumu- late according to union and Department contracts and policy, and is paid upon normal termination at the current rate of pay. The Department's policy is to recognize vacation costs at the time payments are made. The Department records accumulated, unused, vested sick pay as a liability. The amount recorded is the amount to be paid upon normal termination at the current rate of pay. L. Long -Term Obligations - The proprietary fund financial statements report long -term debt and other long -term obligations as liabilities in the State- ments of Net Position. M. Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures for contingent assets and liabilities at the date of the financial statements, and the reported amounts of the revenues and expenses during the fiscal year. Actual results could vary from estimates that were used. 13 N. Rate of Return - The Department's rates must be set such that earnings attributable to electric operations do not exceed eight percent of the net cost of plant. The Department's audited financial statements are prepared in accordance with auditing standards generally accepted in the United States of America. To determine the net income subject to the rate of return limitations, the Department performs the following calculation. Using the net income per the audited financial statements, the return on invest- ment to the Town of Reading is added back, the fuel charge adjustment is added or deducted, and miscellaneous debits /credits (i.e., gain/loss on disposal of fixed assets, etc.) are added or deducted, leaving an adjusted net income figure for rate of return purposes. Investment interest income and bond principal payments are then deducted from this figure to deter- mine the net income subject to the rate of return. The net income subject to the rate of return is then subtracted from the allowable eight percent rate of return, which is calculated by adding the book value of net plant and the investment in associated companies less the contributiTrma n- struction multiplied by eight percent. From this calculatci al Light Board will determine what cash tranYP a end of the fiscal year. 0. Corn arative Financial Info r ation The 's ements include prior- ear m roll a inf uc does f inc ude lent eta to slit to tion with �ge er ly a c�ed cc�nti ncip s gly, such informaton d be read i nju ction the s financial statements for a earree ded J n 30. 2014, m which the summarized information Total cash and investments as of June 30, 2015 are classified in the accompanying financial statements as follows: Proprietary Fund: Unresfided cash and short-tens investments $ 13,151,862 Restricted cash and short -term investments 22,344,776 Restricted investments 1,284,061 Fiduciary Funds: Cash and short-term investments - Pension Trust 2,666,772 Cash and short-term investments - OPEB Trust 1,857,738 Investments - Pension Trust 1,284,061 Total cash and investments $ 42,589,270 14 Total cash and investments at June 30, 2015 consist of the following: Cash on hand $ 3,000 Deposits with financial institutions 42,586,270 Total cash and investments $ 42,589,270 Disclosures Relating to Interest Rate Risk Interest rate risk is the risk that the fair value of an investment will be adversely affected by changes in market interest rates. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. The Department manages its exposure to interest rate risk by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to_prpvide the cash flow and liquidity needed for operations. As of June 30, 2015, the Department (includ' the Perisli at ai id OPEB Trust) held cash and short-tenrbta nu in p ed i vestm nts ith the Massachusetts Munl i al Det ( MD IC -insu ed savings accounts, �nd� day 12,q,�IC -i ce ific deposi I ause of their imm dia td tl End/ m turf , these fund lassified as ca a d sh�1 -t'e nve tmin th a com anying financial statements and ar n t conside to exposed to s t interest rate risk. eparrtment and Pension Trust held investments in income bonds with varying maturity dates as follows: Disclosures Relating to Credit Risk Generally, credit risk is the risk that the issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assign- ing of a rating by a nationally recognized statistical rating organization. As 15 Proprietary Fiduciary Fund Funds Restricted Pension Maturity Investments Trust Date Corporate bonds AT &T Inc $ 207,764 $ 207,764 12101122 General Electric Cap Corp 206,035 206,035 01109123 Wells Fargo & Co 208,048 208,048 0811523 Rabobank Nederland Bank 249,043 249,043 11/0922 Teva Pharmaceut Fin BV 207,707 207,707 12118/22 BNP Paribas 205,464 205,464 03/03/23 Total $ 1,284,061 $ 1,284,061 Disclosures Relating to Credit Risk Generally, credit risk is the risk that the issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assign- ing of a rating by a nationally recognized statistical rating organization. As 15 of June 30, 2015, the Department and Pension Trust held investments in domestic and foreign fixed income bonds with varying ratings as follows: Investment TVDe Corporate bonds: AT &T Inc General Electric Cap Corp Wells Fargo & Cc Rabobank Nederland Bank Teva Pharmaoeut Fin BV BNP Paribas Total Concentration of Credit Risk The Department follows the not limit the amount that can lated by Ma setts Gen Risk Proprietary Fiduciary Fund Funds Restricted Pension Moody's Investments Trust Rating $ 207,764 $ 207,764 BAA1 206,035 206,035 Al 208,048 208,048 A3 249,043 249,043 A3 207,707 207,707 A3 205,464 205,464 Al 0 of in F $ 1,284,061 $ 1,284,061 din s stment poll y, ich does in ny o ss er bey nd t at sfpu- t J e 3 the epa ment and lom slit and foreign f e 'come i of he bonds each individually a ' and System's total invest- . ederland Bank represents approx- Custodial Credit Risk for deposits is the risk that, in the event of the failure of a depository financial institution, the Department will not be able to recover its deposits or will not be able to recover collateral securities that are in the pos- session of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty, (e.g., broker - dealer) to a transaction, the Department will not be able to recover the value of its investments or collateral securities that are in the possession of another party. Massachusetts General Laws, Chapter 44, Section 55, limits deposits "in a bank or trust company or banking company to an amount not exceeding sixty per cent of the capital and surplus of such bank or trust company or banking company, unless satisfactory security is given to it by such bank or trust company or banking company for such excess." The Department follows the Massachusetts statute as written, as well as the Town of Reading's deposit policy for custodial credit risk. As of June 30, 2015, none of the Department's (including Pension Trust and OPEB Trust) cash and short-tens investments was exposed to custodial credit risk. 16 As of June 30, 2015, none of the Department or Pension Trust investments were exposed to custodial credit risk because the related securities are registered in the Department's name. 3. Restricted Cash and Investments The Department's proprietary fund restricted cash and investment balances represent the following reserves: Depreciation fund Construction fund Deferred fuel reserve Deferred energy conservation reserve Rate stabilization Reserve for uncollectible accounts Sick leave benefits Hazardous waste fpm TDT 6/30/15 Cash Investments 5,434,308 $ - 1,400,000 - 5,180,285 584,606 6,771,634 reserves: 6/30/14 Cash Investments $ 4,130,585 $ - 1,000,000 - 4,132,695 1,292,906 $ 19,219,111 $ 1,292,906 Depreciation ciation fund - The Department is normally required to reserve 3.0% of capital assets each year to Lund capital improvements. Construction fund — This represents additional funds set aside to fund capital expenditures. Deferred fuel reserve - The Department transfers the difference between the customers' monthly fuel charge adjustment and actual fuel costs into this account to be used in the event of a sudden increase in fuel costs. Deferred enerov conservation reserve - This account is used to reserve monies collected from a special energy charge added to customer bills. Customers who undertake measures to conserve and improve energy efficiency can apply for rebates that are paid from this account. Rate stabilization - This represents amounts set aside to help stabilize cost increases resulting from fluctuations in purchase power costs. Reserve for uncollectible accounts - This account was set up to offset a portion of the Department's bad debt reserve. Sick leave benefits - This account is used to offset the Department's actuarially determined compensated absence liability. 17 - Hazardous waste fund -This reserve was setup by the Board of Commissioners to cover the Department's insurance deductible in the event of a major hazardous materials incident. - Customer deposits - Customer deposits that are held in escrow. 4. Accounts Receivable Accounts receivable consists of the following at June 30, 2015: Customer Accounts: Billed $ 1,947,170 Less allowances: Uncollectible accounts (200,000) Sales discounts (86,174) Total billed 6 Unbilled, net 5166 Total customer Jacc 6 27, 46 Otn T21,689 D 19,333 ccounts 486,713 Total net receivables $ 7,314,059 S. Prepaid Expenses Prepaid expenses consist of the following: Insurance and other $ 292,268 Purchase power 294,455 NYPA prepayment fund 307,573 WC Fuel - Watson 243,602 Total $ 1,137,898 6. Inventory Inventory is comprised of supplies and materials at June 30, 2015, and is valued using the average cost method. 18 Investment in Associated Companies Under agreements with the New England Hydro- Transmission Electric Com- pany, Inc. (NEH) and the New England Hydro- Transmission Corporation (NHH), the Department has made the following advances to fund its equity requirements for the Hydro - Quebec Phase II interconnection. The Depart- ment is carrying its investment at cost, reduced by shares repurchased. The Department's equity position in the Project is less than one -half of one percent. Investment in associated companies consists of the following, at June 30, 2015 New England Hydro - Transmission (NEH & NHH) $ 26,994 8. Capital Assets The following is a summary of fiscal year 2015 activity in ca ' sets (i thousands): Be inning Ending B lanc In eases ecre a Balance Business -Type Activities - Capital asse g deprec ted: Structure and i emen s ings $ 4,18 1,78 $ 363 309 $ $ (371) 14,546 31,725 e and rni c re 2 2,970 (487) 85,222 Dnfras p i alas t being p eciat d 128,709 3,642 (858) 131,493 u ulate dep r: e provements (8,136) (389) - (8,525) ent and furnishings (19,490) (971) 371 (20,090) Infrastructure 3( 2.155) (2,502) 429 (34.229) Total accumulated depreciation 5( 9,781) (3.862) 800 6( 2,843) Total capital assets, being depreciated, net 68,928 (220) (58) 68,650 Capital assets, not being depreciated: Land 1,266 1,266 Total capital assets, not being depreciated 1,266 1,266 Capital assets, net $ 70,194 $ (220) $ (58) $ 69,916 9. Deferred Outflows of Resources Deferred outflows of resources represent the Department's consumption of net position that is applicable to future reporting periods. Deferred outflows of resources have a positive effect on net position, similar to assets. 19 The following is a summary of deferred outflow of resources balances as of June 30,2015: Proprietary Fund Net difference between projected and actual investment earnings on pension plan $ 47,815 Pension plan contributions subsequent to the measurement date 1,500,000 Total $ 1,547,815 10. Accounts Payable Accounts payable represent fiscal 2015 expenses that wer after J ne 30, 2015. 11. Accrued Liabilities Accrued li bilitips-spnsi oft e f II win at une 30, 2015: D A ed ale t 356,436 ccru d ale tax 192,345 the 36,323 Total $ 585,104 12. Customer Deposits This balance represents deposits received from customers that are held in escrow. 13. Customer Advances for Construction This balance represents deposits received from vendors in advance for work to be performed by the Department. The Department recognizes these deposits as revenue after the work has been completed. 14. Accrued Employee Compensated Absences Department employees are granted sick leave in varying amounts. Upon retire- ment, normal termination, or death, employees are compensated for unused sick leave (subject to certain limitations) at their then current rates of pay. 20 15. Restricted Net Position The proprietary fund financial statements report restricted net position when external constraints are placed on net position. Specifically, restricted net position represents depreciation fund reserves, which are restricted for future capital costs. 16. Post - Employment Health Care and Life Insurance Benefits Other Post - Employment Benefits The Department follows GASB Statement No. 45, Accounting and Financial Reporting by Employers for Post - Employment Benefits Other Than Pensions. Statement No. 45 requires governments to account for other post - employment benefits (OPEB), primarily healthcare, on an accrual basis rather than on a pay -as- you -go basis. The effect is the recognition of an actuarial v d contribution as an expense on the proprietary fund St of Rev es, Expenses, and Changes in Net Position whe ure r ti a ms their post - employment benefits, rather than n they use o the xten that an entity does not fund their ac ially r uired con ' , a po t -e ployment benefit liabili 'zed o thR pr riet fund ement of et Position o er tim /u\ I scn on ion ovidi he ension benefits described in Note 17, the en pro st- employment health and life insurance benefits ployees through the Town of Reading's participation in the chusetts Interlocal Insurance Association (MIIA) Health Benefits Trust. Benefits, benefit levels, employee contributions and employer con- tributions are governed by Chapter 32 of the Massachusetts General Laws. As of June 30, 2014, the actuarial valuation measurement date, approximately 87 retirees and 51 active employees meet the eligibility requirements. The plan does not issue a separate financial report. B. Benefits Provided The Department provides post - employment medical, prescription drug, and life insurance benefits to all eligible retirees and their surviving spouses. All active employees who refire from the Department and meet the appropriate criteria are eligible to receive these benefits. C. Fundina Policy As of the June 30, 2014, the actuarial valuation measurement date, retirees are required to contribute 29% of the cost of the medical and prescription drug plan, as determined by the MIIA Health Benefits Trust. Retirees also contribute 50% of the premium for a $5,000 life insurance benefit. The 21 Department contributes the remainder of the medical, prescription drug, and life insurance plan costs on a pay -as- you-go basis. D. Annual OPEB Costs and Net OPEB Obligation The Department's fiscal 2015 annual OPEB expense is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB State- ment No, 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost per year and amortize the unfunded actuarial liability over a remaining period of sixteen years. The following table shows the components of the Department's annual OPEB cost for the year ending June 30, 2015, the amount actually contributed to the plan, and the change in the Department's net OPEB obligation based on an actuarial valuation as of June 30, 2014. Annual Required Contribution (ARC) $ 54 Interest on net OPEB obligation 218 069 Annu P cost 7 ,525 P ben it pay e 413,143 DIn ea i net P B o ligation 5,382 D et OPEB igati n - be ' ing ant bu'onst P Trust 345,382 (1) a PEB obligation - end of year $ 11) See Pad E far atltlifional in/armetion The Department's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for fiscal year 2015 and the two preceding fiscal years were as follows: Annual Percentage of OPEB OPEB Net OPEB Fiscal Year Ended Cost Cost Contributed Obligation 2015 $ 758,525 100.00% $ 2014 $ 768,378 100.00% $ - 2013 $ 604,987 100.00% $ - 22 E. Funded Status and Funding Progress The funded status of the plan as of June 30, 2014, the most recent actuarial valuation measurement date was as follows: Actuarial accrued liability (AAL) $ 7,726,667 Actuarial value of plan assets 1,846,042 Unfunded actuarial accrued liability (UAAL) $ 5,880,625 Funded ratio (actuarial value of plan assets/AAL) 23.89% Covered payroll (active plan members) N/A UAAL as a percentage of covered payroll N/A In 2010, the Department's Municipal Light Board voted to accept the provi- sions of Chapter 32B §20 of Massachusetts General Lawrechnis an Other Post - Employment Benefits Liability Trust Fun a to set aside monies to fun d its OPEB liability. In e m oted to create an OPEB trust instrumen ' align ent a ong. In fiscal year 2015, the Depr nt ntrib ted 2 to th s tr t, which was a ual t act y de rmi d annu ontrib ion through June 3 015. The ssehat siti n of is trust are epo ed in the no„.rt on4c *uci ry F �S1t' ate en of iduciary Net sition. Act ar IV t'on f o olrig�pjar11n�ve estimates of the value of rep rt d a o is an 5 ptions about the probability of events far into the t re. xa nclude assumptions about future employment, mor- t ty, a healthcare cost trend. Amounts determined regarding the Eyed status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared to past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary infor- mation following the notes to the financial statements, presents multi-year trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability. F. Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the plan as understood by the Department and the plan members and include the types of benefits provided at the time of each actuarial valuation and the historical pattern of sharing of benefit costs between the Department and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long -term perspective of the calculations. 23 In the June 30, 2014 actuarial valuation, the Projected Unit Credit actuarial cost method was used. The Department's actuarial value of plan assets was $1,846,042. The actuarial assumptions included a 7.75% investment rate of return and an initial annual health care cost trend rate of 8.0% which decreases by 0.5% for six years to an ultimate level of 5.0% per year. The amortization costs for the initial UAAL is a level percentage of payroll amortization, with amortization payments increasing at 2.5% per year for a remaining period of 16 years. 17. Reading Contributory Retirement System The Department follows the provisions of GASB Statement No. 68, Accounting and Financial Reporting for Pensions — An Amendment of GASB Statement No. 27, with respect to the employees' retirement funds. A. Plan Description Substantially all employees of the Depart m m 1plapro Town of Reading Contributory Retirem t Syst m (t haring, multiple- employer public a oye retire ant s ible employees icipat in he ste . The pe ioes pensio nefits, de rred all anc s, a d d andnefits. )3is t r 32 Gtth�e M ssa u tt Ge er I La s estabthority e y as ell a con ribution a ant gas and benefits paid. The a Ref men o d d t e authority to amend benefit si ns. d itiona i for ation is disclosed in the System's annual ci I re 0rts, are publically available from the System's admin- iv es located at Reading Town Hall, 16 Lowell Street, Reading, sachusetts,01867. B. Benefits Provided The System provides for retirement allowance benefits up to a maximum of 80% of a member's highest three -year average annual rate of regular compensation. Benefit payments are based upon a member's age, length of creditable service, level of compensation and group classification. Members become vested after 10 years of creditable service. A refirement allowance may be received upon reaching age 65 or upon attaining 20 years of ser- vice. The plan also provides for early retirement at age 55 if the participant (1) has a record of 10 years of creditable service, (2) was on the Depart- ment payroll on January 1, 1978, (3) voluntarily left Department employment on or after that date, and (4) left accumulated annuity deductions in the fund. A retirement allowance consists of two parts: an annuity and a pension. A member's accumulated total deductions and a portion of the interest they generate constitute the annuity. The difference between the total retirement allowance and the annuity is the pension. The average retirement benefit is approximately 80 -85% pension and 15 -20% annuity. 24 Per Chapter 176 of the Acts of 2011, for members who retire on or after April 2, 2012, if in the 5 years of creditable service immediately preceding retirement, the difference in the annual rate of regular compensation between any 2 consecutive years exceeds 100 percent, the normal yearly amount of the retirement allowance shall be based on the average annual rate of regular compensation received by the member during the period of 5 consecutive years preceding retirement. Employees who resign from service and who are not eligible to receive a retirement allowance or are under the age of 55 are entitled to request a refund of their accumulated total deductions. In addition, depending upon the number of years of creditable service, such employees are entitled to receive zero, fifty, or one hundred percent of the regular interest which has accrued upon those deductions. However, effective July 1, 2010, members voluntarily withdrawing with less than 10 years of service get credited interest each year at a rate of 3% and do not fVrco st previously earned on contributions. C. Contributions Participants contribute a se perce tage f th s pensaton y. mplo ee ont'buti perc ein Cha ter 3�.0( the ass ch tts en ral aws. Th in 'wd al ntr It pe ce is to min d by their date of entry into th sys em. I addif n, all a ploy e d after January 1, 1979 con lb to�'@ dditi al 2% n all regular compensation over the rate of 30,QOQWer y e percentages are as follows: t3efore January 1, 1975 5% January 1, 1975 - December 31, 1983 7% January 1, 1984 - June 30, 1996 8% Beginning July 1, 1996 9% Employers are required to contribute at actuarially determined rates as accepted by the Public Employee Retirement Administration Commission (PERAC). The Department's contribution to the System for the year ended June 30, 2015 was $1,401,638, which was equal to its annual required contribution. D. Summary of Sianificant Accounting Policies For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pen- sion expense, information about the fiduciary net position of the System and additions to /deductions from System's fiduciary net position have been determined on the same basis as they are reported by System. For this purpose, benefit payments (including refunds of employee contdbu- 25 tions) are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value. E. Pension Liabilities Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions At June 30, 2015, the Department reported a liability of $4,524,191 for its proportionate share of the System's net pension liability. The net pension liability was measured as of December 31, 2014, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of July 1, 2013 rolled forward to December 31, 2014. The Department's proportion of the net pension liability was based on an actuarially determined projection of the Department's long -term share of contributions to the pension plan relative to the projected contributions of all participating employers. At December 31, 2014, the Department's proportion was 28.25 %. trust for the purpose of currentl holing s a equireci cont ibution to the Town of Reading Contri utory ebre ant (RC S). nnual contribution st at a ua Ily d termin be th net ormal cost fo ndin the epa me s lia ility for p nsion benefi for covered to ees, an bot the rin I I an in om of the trust is estricted for the x lusi e t of apartment a pl ye and their beneficiaries. Thi P nsi Trust r ort as i ry fund type in the Department's bas' nan ial late t not ' he first paragraph of this section, the Department's propor- lonate share of the RCRS net pension liability was determined by an actuarial valuation as of July 1, 2013 rolled forward to December 31, 2014. However, the actuarial valuation does not take into account the fiduciary net position of the Department's Pension Trust at December 31, 2014 (the measurement date). Accordingly, the following reconciliation is provided: 2015 Net pension liability, per actuarial valuation $ 8,464,663 Pension Trust Net Position (5,450,833) Pension Trust contributions subsequent to the net pension liability measurement date (reported as deferred outflows of resources in the proprietary fund Statements of Net Position) 1,500,000 Pension Trust investment income and fair value changes subsequent to the net pension liability measurement date 10,361 Net pension liability, as reported on the proprietary fund Statements of Net Position $ 4,524,191 ii For the year ended June 30, 2015, the Department recognized pension expense of $833,949. In addition, the Department reported deferred outflows of resources related to pensions from the following sources: Deferred outflows of resources related to pensions resulting fro butions subsequent to the measurement date will be r zed as reduction of the Departmenrs net pension li ' in year enQ€ June 30. 2016. r Amour will be Zulu Total $ 1,511,954 11,954 11,954 11.953 $ 1,547,815 Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of July 1, 2013, rolled forward to the measurement date of December 31, 2014 using the following actuarial assumptions, applied to all periods included in the measurement: Inflation 3.75% per year Salary increases Based on years of service, 7.00 % - 4.75% for Group 1 members and 8.00 % - 5.25% for Group 4 members Investment rate of return 7.75 %, net of pension plan investment expense, including inflation 27 Deferred Outflows of Resources Net difference between projected and actual earnings on pension plan investments $ 47,815 Contributions subsequent to the measurement date 1,500,000 Total $ 1,547,815 Deferred outflows of resources related to pensions resulting fro butions subsequent to the measurement date will be r zed as reduction of the Departmenrs net pension li ' in year enQ€ June 30. 2016. r Amour will be Zulu Total $ 1,511,954 11,954 11,954 11.953 $ 1,547,815 Actuarial assumptions: The total pension liability was determined by an actuarial valuation as of July 1, 2013, rolled forward to the measurement date of December 31, 2014 using the following actuarial assumptions, applied to all periods included in the measurement: Inflation 3.75% per year Salary increases Based on years of service, 7.00 % - 4.75% for Group 1 members and 8.00 % - 5.25% for Group 4 members Investment rate of return 7.75 %, net of pension plan investment expense, including inflation 27 Mortality rates were based on the RP -2000 Mortality Table projected to 2012 with Scale AA. For disabled lives, the mortality rates were based on the RP -2000 Mortality Table set forward five years. The long -tern expected rate of return on pension plan investments was determined using a building -block method in which best- estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long -term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the pension plan's target asset allocation as of December 31. 2014 are summarized in the following table: Long -term Target Asset Class A ocabo f"Rett rn Global equity 43. 6.230 Inc a 23.0 ° 5.050 P,riva(e eq ity 10. % 9.750 st e Q 10. % 6.50% D :Te is Res s . 0% 6.00% e fun s 10.00% 7.00% otal 100.00% Discount Rate: The discount rate used to measure the total pension liability was 7.75 %. The projection of cash flows used to determine the discount rate assumed that plan member contributions will be made at the current contribution rate and that contributions from participating employers will be made in accordance with Sections 22D and 22F of Chapter 32 of the Massachusetts General Laws. Based on those assumptions, the pension plan's fiduciary net position was projected to be available to make all pro- jected benefit payments of current plan members. Therefore, the long -term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the Department's proportionate share of the net pension liability to changes in the discount rate: The following table presents the Department's proportionate share of the net pension liability (asset) cal- culated using the current discount rate of 7.75 %, as well as what the Department's proportionate share of the net pension liability (asset) would N2 18. be if it were calculated using a discount rate that is 1 percentage -point lower (6.75 %) or 1 percentage -point higher (8.75 %) than the current rate: Current 1% Discount 1% Decrease Rate Increase Fiscal Year Ended (6.75 %) (7.75 %) (8.75 %) 06/30/15 $ 7,521,554 $ 4,524,191 $ (1,116,986) Pension plan fiduciary net position: Detailed information about the pension plan's fiduciary net position is available in the separately issued System financial report. Company / The Town of Reading, acting through its Lig epartm tll�s certain Projects of the Massach Munic pal olesale E ( MMWEC). WEC i a p ' cor orati n ii'ndj a p litic I su division of wealt of ass cse , cr ate a m a s to evelop a bulk power supply its a bers and er ilities. WE horized to construct, own, �1, urc a e o n rship t res in, a issue revenue bonds to finance, tric fa ilitie ( jec WEC has acquired ownership interests in tri fa ilitie cps ed by other entities and also owns and operates its ow lect acilities. MMWEC sells all of the capability (Project Capability) each of its Projects to its Members and other utilities (Project Participants) under Power Sales Agreements (PSAs). Among other things, the PSAs require each Project Participant to pay its pro rata share of MMWEC's costs related to the Project, which costs include debt service on the revenue bonds issued by MMWEC to finance the Project, plus 10% of MMWEC's debt ser- vice to be paid into a Reserve and Contingency Fund. In addition, should a Project Participant fail to make any payment when due, other Project Partici- pants of that Project may be required to increase (step -up) their payments and correspondingly their Participant's share of that Project's Project Capa- bility to an additional amount not to exceed 25% of their original Participant's share of that Project's Project Capability. Project Participants have cove- nanted to fix, revise, and collect rates at least sufficient to meet their obliga- tions under the PSAs. MMWEC has eight Projects. MMWEC originally financed all eight Projects through the issuance of a multiple series of revenue bonds under a General Bond Resolution adopted by MMWEC in 1976 (GBR). Security for these bonds included a pledge of the revenues derived by MMWEC from all its Project PSAs, without regard to Project or series of bonds. In 2001, through W, a refinancing of all its outstanding bonds, MMWEC amended and restated its GBR to eliminate this "joint - pledge" of revenues. In refinancing its debt, MMWEC issued a separate issue of bonds for each of the eight Projects, which are payable solely from, and secured solely by, the revenues derived from the Project to which such issue relates plus available funds pledged under the Amended and Restated GBR with respect to the bonds of such issue. The MMWEC revenues derived from each Project are used solely to provide for the payment of the bonds of any bond issue relating to such Project and to pay MMWEC's cost of owning and operating such Project and are not used to provide for the payment of the bonds of any bond issue relating to any other Project. MMWEC operates the Stony Brook Intermediate Project and the Stony Brook Peaking Project, both fossil - fueled power plants. MMWEC has a 22.7 MW interest in the W. F. Wyman Unit No. 4 plant, owned and operated by subsid- iaries of Florida Power & Light and a 4.8% ownership interest in the Mil.wone Unit 3 nuclear unit operated by Dominion Nuclear Connectic N 1), a subsidiary of Dominion Resources, Inc. DNCI has i s intentio a an application with the Nuclear Regulatory COT ssion n e tension of the Millstone Unit 3 operating li whicurr y will expir in 025. DNCI has not yet filed its a lication ith th NRC EC as 6% wn h' ter st i the eabrook Sta i uclear gener tin uniatp ch pre ent ubs n alp rtion of its plant investment d fin n ing progra On ova 1, indirect subsidiary of FPL Gr up I c , FP nerg abr ok, LL urchased an approximate 88% sh re i t e S br ok n plant from seven other owners. MMWEC is woe thr e, minority non - operating owners of Seabrook Station. ursuant to the PSAs, the MMWEC Seabrook and Millstone Project Partici- pants are liable for their proportionate share of the costs associated with decommissioning the plants, which is being funded through monthly Project billings. The Project Participants are also liable for their proportionate share of the uninsured costs of a nuclear incident that might be imposed under the Price- Anderson Act (Act). By its terms, the Act expired in August 2002. Congress is currently considering extending the Act. In November 1997, the Commonwealth of Massachusetts enacted legislation effective March 1, 1998 to restructure the electric utility industry. MMWEC and the municipal light departments, including the Massachusetts Project Participants, are not specifically subject to this legislation. However, it is management's belief that industry restructuring and customer choice promulgated by the legislation will have an effect on MMWEC and the Participants' operations. The Reading Municipal Light Department has entered into PSAs and Power Purchase Agreements (PPAs) with MMWEC. Under both the PSAs and PPAs, the Department is required to make certain payments to MMWEC 30 payable solely from Department revenues. Under the PSAs, each Participant is unconditionally obligated to make payments due to MMWEC whether or not the Project(s) is completed or operafing and notwithstanding the suspension or interruption of the output of the Project(s). MMWEC is involved in various legal actions. In the opinion of management, the outcome of such lifigation or claims will not have a material adverse effect on the financial position of the company. After the July 1, 2015 principal payment, total capital expenditures amounted to $1,682,341,000, of which $125,343,000 represents the amount associated with the Department's Project Capability. MMWEC's debt outstanding for the Projects from Power Supply System Revenue Bonds totals $167,110,000, of which $6,373,000 is associated with the Department's share of Project Capability. After the July 1, 2015 principal payment, MMWEC's total future debt service requirement on outstanding bonds issued for the Projects $121,353,000, of which $4,362,000 is anticipated to be billed Department in the future. The aggregate amount of the D ant's i Bqui pa menTt he PSAs and PPAs, exclusive of a Res rve a d C ing ncy ngs, to MMWEC 0, 2 15 an e� at d fo futu rs is low. DU Annual Costs D Fo ors de Ju $ 2,700,000 2017 1,472,000 2018 190,000 Total $ 4,362,000 In addition, under the PSAs, the Department is required to pay to MMWEC its share of the Operation and Maintenance (O& M) costs of the Projects in which it participates. The Department's total O& M costs including debt service under the PSAs were $12,475,000 and $14,021,000 for the years ended June 30, 2015 and 2014, respectively. 19. Renewable Energy Certificates In 2003, the Massachusetts Department of Energy and Environmental Affairs adopted the Massachusetts Renewable Energy Portfolio Standard (RPS), a regulation that requires Investor Owned Utilities (IOUs) to purchase mandated amounts of energy generated by renewable resources (Green Energy) as a percentage of their overall electricity sales. The Massachusetts RPS applies only to IOUs, so the Department is currently exempt from this mandate. 31 Energy suppliers meet their annual RPS obligations by acquiring a sufficient quantity of RPS - qualified renewable energy certificates (RECs) that are created and recorded at the New England Power Pool ( NEPOOL) Generation Information System (GIS). Suppliers can purchase RECs from electricity gen- erators or from other utilities that have acquired RECs. As part of its ongoing commitment to Green Energy, the Department has entered into Purchase Power Agreements (PPAS) with Swift River Hydro LLC and Concord Steam Corporation to purchase power generated from renewable energy resources. These PPAs include the Department taking title to RECs, which certify that the energy produced was the product of a renewable resource. Because the Department is exempt from the RPS provisions, it has the option of holding these RECs unfil they expire or selling them through the NEPOOL GIS. Information regarding the Departments fiscal year 2015 REC activity and balances is as follows: gD REC Sales During Fiscal 2015 Estimated Certificates Certificates Certificates Value MA Class I & II - 1,550 1,550 $ 74,400 CT Class 1 5,435 5,435 260,880 C rtif////c���cat 66985 $ 335,280 Am unt ie s 11 las 1 7,y32 4 $ f.5 $ 26 316 68, 8 IRIew 3 8 17,512 s 1 70 52.00 296,504 la II 371 25.00 9,275 lass 624 47.50 29,640 I New 120 47.50 5,700 CT Class 1 4,452 47.50 211,470 Total 14,023 $ 665,265 I'I (�) Sale proceeds netted against fiscal year 2015 purchased power fuel charge REC Holdinas at June 30, 2015 Banked Projected Total Estimated Certificates Certificates Certificates Value MA Class I & II - 1,550 1,550 $ 74,400 CT Class 1 5,435 5,435 260,880 Total 6,985 66985 $ 335,280 Because there is no formal accounting guidance under GAAP or IFRS for RECs and the Department does not have a formal policy for the future disp- osition of RECs, the estimated fair value of the Departments REC holdings at 32 20. June 30, 2015 are not recognized as an asset on the proprietary fund Statements of Net Position. Leases Related Party Transaction - Property Sub -Lease The Department is the lessor of facilities that are currently sub - leased to the Reading Town Employees Federal Credit Union. The original sub -lease agreement commenced in December 2000 and was extended by various amendments through November 30, 2015. Following is the future minimum rental income to be received by the Department under the terms of this lease for the year ending June 30: 2016 $ 4,084 Total $ 4,084 Operating Lease - Warehouse The Department is the lessee a wa ehOL Estate Trust. T ' ' leas a ee an De ember 98 and we ext nit y ni . Un r th ter s th mot yen Ii T28. Bon ext d th lease for an II win ' the tur mi e t fo th year di June 30: 2016 Total 21. Beoinnina Net Position Restatement Real d in May 31, 24 months until May 31, se to be paid by the $ 147,902 $ 147,902 In fiscal year 2015, the Department implemented GASB Statement No. 68, Accounting and Financial Reporting for Pensions — An Amendment of GASB Statement No. 27. As a result of this implementation, the beginning (July 1, 2014) net position of the Department's proprietary fund has been restated as follows: Business -Type Activities Proprietary Fund As previously reported GASB 68 Implementation As restated 33 $ 101,873,334 (3,669,527) $ 98,203,807 TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF FUNDING PROGRESS REQUIRED SUPPLEMENTARY INFORMATION June 30, 2015 (Unaudited) Actuarial Actuarial Value of Valuation Assets Date ll Other Post - Employment Benefits Actuarial Accrued Liability Unfunded (AAL) - AAL Entry Age (UAAL) & (b-a) . 06/30/14 $ 1,846,042 $ 7,726,667 06/30/13 $ 1,495,511 7,588,99 $ 06/30/11 $ 1,1 $ 8, 43,4 n$ 06/30/ $ - D $ 8, 85,3 8 D ependent Auditors' Report. 34 UAAL as a Percent- age of Funded Cover overed t/ Payroll b c b -a /c % /A N/A 7R N/A /A N/A 0.00% N/A TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY REQUIRED SUPPLEMENTARY INFORMATION JUNE 30, 2015 (Unaudited) Reading Contributory Retirement System: 2015 Proportion of the net pension liability (asset) 28 % Proportionate share of the net pensio liabil' 4, 24,191 Cover -emplo ee p�yrel{ 08,693 Pr o nat s are of the pe ion (as et) s a er enta o f its v red 76.57% >,fi ciary net position as a percentage of total pension liability 79.89% Schedules are intended to show information for 10 years. Additional years will be displayed as they become available See Independent Auditors' Report. 35 TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF CONTRIBUTIONS REQUIRED SUPPLEMENTARY INFORMATION JUNE 30, 2015 (Unaudited) Readina Contributory Retirement System: 2015 Contractually required contributions for the current fiscal year L01 Actual contributions for the current fist I year' relation to the contr re ired Q contribu ions Contribution efi iency � $ - $ 5,908,693 ins as a percentage of covered - payroll 23.72% Schedules are intended to show information for 10 years. Additional years will be displayed as they become available See Independent Auditors' Report. RMLD Policy No. 12 READING MUNICIPAL LIGHT BOARD DOCUMENTS DISSEMINATION REVISION No. 2 Commission Vote /Effective Date General Manager /Date Next Review Date APPLICABILITY: This policy governs the dissemination of Reading Municipal Light Department ( "RMLD ") Board documents prior to, during, and after Board meetings. For purposes of this policy, Board documents encompass written recommendations or proposals to the Board by the RMLD General Manager or designated staff, proposed budgets, other draft documents requiring or seeking the Board's approval, meeting agendas, meeting minutes, and other documents submitted to the Board for its consideration. Il. RESPONSIBILITIES: A. RMLD Board Responsible for periodic review of this policy and review of executive session minutes and materials. B. General Manager Responsible for assisting the Board regarding the implementation and consistent application of this policy, and the determination of whether a Board document may be withheld from disclosure to members of the public under applicable law. III. DISSEMINATION PRIOR TO BOARD MEETING: A. Purpose. This policy is necessary to ensure that documents submitted to the Board are not mistaken for Board - approved policy, procedures, or positions prior to consideration and adoption by the Board. B. General Policy. All documents submitted to the Board, whether such document expressly requests or requires action by the RMLD Board or is submitted in support of such request, shall not be distributed to anyone other than a legally elected Board member, the General Manager or other applicable RMLD managers, employees, consultants or attorneys prior to a properly established Board meeting, unless such documents constitute public records as defined by M.G.L. c. 4, § 7 (clause twenty - sixth). C. Deliberative Process Exemption. Documents exempt from disclosure under M.G.L. c. 4, § 7 (clause twenty- sixth)(d) — the "Deliberative Process Exemption" - shall not be distributed to anyone other the Board, RMLD staff or agents, until the Board takes action with respect to the policy matter under consideration or such deliberative process with respect to such matter otherwise has been concluded. Such documents include inter- agency and intra- agency memoranda and letters relating to policy positions being developed by the RMLD Board, such as draft policies, documents relating to pending or threatened litigation or contract negotiations, incomplete budgets or financial proposals, and other matters requiring Board approval. Reasonably completed factual studies or reports in which Board policy decisions may be based constitute public records and are subject to disclosure pursuant to a public records request. Attachment 2 III. DISSEMINATION PRIOR TO BOARD MEETING: D. Identification of Draft Documents. To avoid giving the mistaken impression that a proposed policy, position, or procedure or other document presented to the Board has been approved by the Board, all draft documents presented to the Board for review and consideration shall be marked "Draft" or with some other appropriate legend indicating that the document may not be in final form, even if such document constitutes a public record subject to disclosure prior to the Board meeting. E. Agendas. The RMLD meeting agenda may be freely distributed prior to a Board meeting to any member of the public who requests a copy. Prior to the RMLD Board Chair's approval of the agenda, the agenda shall be marked "draft." The agenda once approved by the RMLD Board Chair will be posted to the RMLD's website for public viewing. The agenda may be amended as may be required by the Open Meeting Law. Any agenda that is amended after it is posted to the RMLD website shall be marked as "amended." IV. DISTRIBUTION OR INSPECTION OF DOCUMENTS AT THE BOARD MEETING. A. Documents Considered in Open Session. Unless otherwise exempt under the open meeting law, all documents considered by the Board in open session may be freely distributed to any member of the public who attends the Board meeting. In general, materials or other exhibits used by RMLD in an open meeting must also be made available to the public within 10 days of a request. The Board, in its discretion, may make such materials available to the public at the Board meeting. B. Exemptions. There are two personnel - related exemptions to the open session records disclosure requirement: (1) materials (other than those that were created by the RMLD Board for the purpose of the evaluation) used in a performance evaluation of an individual bearing on his professional competence, and (2) materials (other than any resum8 submitted by an applicant, which is subject to disclosure) used in deliberations about employment or appointment of individuals, including applications and supporting materials. Documents created by members of the Board for the purpose of performing an evaluation are subject to disclosure. This requirement applies to both individual evaluations and evaluation compilations, provided the documents were created by members of the Board for the purpose of the evaluation. C. Confidential and Other Non - Public Documents. Documents and materials considered in executive session or other confidential or non - public documents submitted to the Board shall not be available for public inspection or dissemination at the Board meeting. V. DISSEMINATION OF EXECUTIVE SESSION MINUTES AND DOCUMENTS FOLLOWING BOARD MEETINGS. A. Release of Materials Submitted to the Board Following the Board Meeting. The disclosure of Board documents, including minutes of open sessions, shall be governed by applicable public records and open meeting laws. B. Executive Session Minutes and Materials. 1. Availability and Confidentiality Obligations. Executive session minutes of Board meetings and related documents are available to all members of the Board and designated RMLD staff. All Board members and RMLD employees shall be bound to maintain their confidentiality until such minutes and /or related materials are released for disclosure as provided in Section V.B.3. 2. Legal Requirements. Executive session minutes will be reviewed and released in accordance with the open meeting law, M.G.L. c. 30A, § 22 and the public records and open meeting exemptions in M.G.L. c. 184, § 47D and as provided herein. V. DISSEMINATION OF EXECUTIVE SESSION MINUTES AND DOCUMENTS FOLLOWING BOARD MEETINGS. B. Executive Session Minutes and Materials. 3. Quarterly Review Procedures. a. The Chair and the Secretary of the Board will review approved executive session minutes in their entirety and related materials that are still in confidential status on a minimum of a quarterly basis (no later each January 15, April 15, July 15, October 15) and in response to a public records request for such minutes to determine if continued non - disclosure is warranted under M.G.L. c. 30A, § 22. In conducting the review, the Chair and the Secretary shall consider whether: (1) the executive session was held in compliance with M.G.L. c. 30A, § 21; (2) publication of the minutes or materials would defeat the lawful purposes of the executive session; (3) the minutes or materials include information protected by the attomey- client privilege; (4) the information or materials are subject to one or more of the exemptions under the public records law, M.G.L. c. 4, § 7 (clause twenty- sixth) or M.G.L. c. 164, § 47D; (5) the RMLD Board has voted not to disclose such information (to the extent that the executive session was held to consider RMLD's competitively sensitive information which was entitled to confidentiality under M.G.L. c. 164, § 47D); and (6) the minutes or materials are entitled to confidentiality as personnel information as set forth in M.G.L. c. 30A, § 22(e). b. The Chair and the Secretary shall announce the findings of their quarterly review at the next Board meeting following the completion of such review. Such announcement shall be included in the minutes of that meeting. The Chair and the Secretary shall make a recommendation to the members of the Board to release for publication those minutes or portions of minutes and related materials in which continued confidential treatment is not warranted under M.G.L. c. 30A, § 22. The procedure and timeframe for conducting and voting on reviews in response to a request for executive session minutes are set forth in Section V.B.4. c. Executive session minutes, or portions thereof, will be released only by an affirmative majority vote of at least three (3) members of the Board. 4. Procedures upon Reauest for Executive Session Minutes or Materials. All requests for unreleased executive session minutes will be forwarded to the Chair of the Board immediately following receipt and shall be placed on the next available Board meeting agenda for resolution. If the minutes have not been previously subject to a quarterly review, the Chair and the Secretary shall review the minutes as provided in Section V.B.3 prior to the next Board meeting, if possible. The Chair and the Secretary shall present the findings on whether continued confidentiality is warranted to the Board and the Board shall take a vote on whether to release the minutes or portions thereof at its next regularly scheduled meeting following the request or within 30 days, whichever occurs first. Notwithstanding the foregoing, upon request by any person to inspect or copy the minutes of an executive session or any portion thereof, the Chair or his/her designee, on behalf of the Board, shall respond to the request within 10 days following receipt and shall release any such non - exempt minutes or portions thereof in which the Board previously voted to release. 0 N M N 7 N � Q r-I 0 ■ C) G1 N 3 N v to V u Q L O � � N a a a nA L Q L W O N Attachment 3 O O O O O O O O O O O O O O O O O O O O O O O O 0 CD O O O O O O O O Attachment 3 a U LL VI N LM H 0 I N ao to cu L N W CJ L O N 0 O O Ln a 0 Ln 0 m N 0 6 O O 0 O O V? N O ti ti O O N 0 N m 0 N a v 09 m V N LL N v 0 cJ G Ln N N M Lf1 N Ln C) O N H N O N ri O Y ti C c6 E C) fn a Y o ti CU Q o oN (6 U �L O Ui U)_ _ L!1 Ol O 0 Ln rl N H N O N v c A E a, d Q E Y y �+ v a CL a _ tA f0 u O Y N P O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O 111 O V1 O 111 O t11 O Lr l0 V) ul C C m m N N c-I c-I c-I N N N N ri N r-I r-I 0 N C c-I O N m O N N N O N N c-I O N H 0 V C 0 .N H H `i r CJ G OC f0 U .i 0 H 2 L �C G Q N O m N 00 00 N a-I l/} O O O a a c-1 c-I l/} 00 LO m c-i m Ql N m v m rn m W n r 0 O N a 0 O N m O N N c-I O N N c-1 O N 0 4+ 0 O U Op d C W u O 2 N Q J /i :i N N d O Q N d m N G 7, N 3 1 ry 0 0 M W a 0 d N 0 0 v 0 0 0 v°. aN O 0 N '1 8 0 0 n m 0 0 v E v oa v N Z.. 0 ■ ."1 0 ■ 0 ry To: Coleen O'Brien From (,/� Maureen McHugh, Jane Parenter� Dates. J�V� October 16, 2015 Subject Purchase Power Summary - August, 2015 Energy Services Division (ESD) has completed the Purchase Power Summary for the month of August, 2015. ENERGY The RMLD's total metered load for the month was 72,269,508 kWh, which is a 9.81% increase from the August, 2014 figures. Table 1 is a breakdown by source of the energy purchases. Table 1 'Pepperell, Woronow Indian Rhv Turner Falls,Collins, Pionw kfoslwy Mills, Summit Hydro Amount of Cost of %of Total Total $ $ as e Resource Energy Energy Energy Costs % (kWh) silowb) Millstone d3 3,655,672 $6.71 5.06% $24,530 0.75% Seabrook 5,881,958 $6.69 8.15% $39.327 1.20% Stonybrook Intennediate 8,868,164 $28.75 12.28% $254,948 7.80% Shell Energy 15,642,000 $71.12 21.66% $1,112.512 34.03% Ne #Era 11,516.000 $58.77 15.95% $678,836 20.70% NYPA 2,255,288 $4.92 3.12% $11,096 0.34% ISO Interchange (306,639) $0.00 -0.42% - $2,890 -0.09% NEMA congestion 0 $0.00 0.00% 382.871 -1.92% Coop Resales 16,575 $133.42 0.02% $2,211 0.07% BP Energy 12.159,600 $47.73 16.84% $580.378 17.75% Hydro Projects' 515,524 $103.10 0.71% $53,151 1.63% Braintree Watson Unit 589,086 $50.32 0.82% $29.643 0.91% Saddleback Wind 218,511 $79.53 0.30% $17,378 0.53% Exelon 11,144,400 $46.98 15.44% $523,519 16.01% Stonybrook Peaking 44,341 $221.49 0.08% $9,821 0.30% MonMNTotal 72,200,480 $45.28 100.00% $3,269,589 100.00% 'Pepperell, Woronow Indian Rhv Turner Falls,Collins, Pionw kfoslwy Mills, Summit Hydro Table 2 breaks down the ISO interchange between the DA IMP Settlement and the RT Net Energy for the month of August, 2015. Table 2 Amount Cost e/ of Total Resource of Energy of Energy Energy (kWh) ($ /Mwh) ISO DA LIMP 900,218 $21.23 1.24% Settlement RT Net Energy" - 1,206,857 - $15.49 -1.66% Settlement ISO Interchange (306,639) -$9.42 -0.42% (subtotal) ' Independent System Operator Day -Ahead Locational Marginal Price " Real Time Net Energy AUGUST 2015 ENERGY BY RESOURCE Stonybrook Peaking, 0.3% Braintree Watson Unit, 0.8% — Hydra Projects, 0.7% ISO Interchange, 0.4% NYPA, 3.1 %. 93,50% CAPACITY The RMLD hit a demand of 153,225 M, which occurred on August 17, at 5 pm. The RMLD's monthly UCAP requirement for August, 2015 was 222,880 Ms. Table 3 shows the sources of capacity that the RMLD utilized to meet its requirements. Table 3 Source Amount(kWs) Cost($IkW- month) Total Cost$ %of Total Cost Millstone #3 4,950 34.62 $171,369 9.94% Seabrook 7,910 39.34 $311,205 18.05% Stonybrook Peaking 24,981 2.05 $51,090 2.96% Stonybrook CC 42,925 7.78 $333,978 19.37% NYPA 4,019 4.19 $16,834 0.98% Hydro Quebec 0 0 $17,478 1.01% Neatens 60,000 5.90 $354,000 20.54% Braintree Watson Unit 10,520 29.18 $306,975 17.81% ISO -NE Supply Auction 65,573 2.45 $160,924 9.34% Hydro Projects 2,002 0.00 $0 0.00% Total 222,880 $7.73 $1,723,853 100.00% Table 4 shows the dollar amounts for energy and capacity per source. Table 4 Cost of %of Amt of Energy Power Resource Energy Capacity Total cost Total Cost (kWh) ($/kWh) Millstone #3 $24,530 $171,369 $195,899 3.92% 3,655,672 0.0536 Seabrook $39.327 $311,205 $350,532 7.02% 5,881,958 0.0596 Sonybrook Intermediate $254,948 $333,978 $588,926 11.79% 8,868,164 0.0664 Hydro Quebec $0 $17,478 $17,478 0.35% - 0.0000 Shell Energy $1,112,512 $0 $1,112,512 22.289/6 15,642,000 0.0711 NextEra $678.836 $354,000 $1,030,836 20.641/6 11,518,000 0.0895 e NYPA $11,096 $16.834 $27,930 0.56% 2,255,288 0.0124 ISO Interchange 42,690 $160,924 $158,034 3.16% 306,639 0.5154 Name Congestion - $62,871 $0 - $62.871 -1.26% - 0.0000 SP Energy $580,378 $0 $580.378 11.62% 12,159,600 0.0477 Hydro Projects $53,151 $0 $53,151 4.06% 515,524 0.1031 Braintree Walsun Unit $29,643 $306,975 $336,618 6.74% 589,086 0.5714 Saddleback Wind $17,378 $0 $17,378 0.35% 218,511 0.0795 Coop Resales $2.211 $0 $2,211 0.04% 16,575 0.1334 Exelon Energy $523,519 $0 $523,519 10.48% 11,144,400 0.0470 Stonybrook Peaking $9,821 $51,090 $60,911 1.22% 44,341 1.3737 Monthly Total $3,269,589 $1,723,853 $4,993,442 100.00% 72,813,758 0.0686 ` Renewable Resources 4.11% RENEWABLE ENERGY CERTIFICATES (RECs) Table 5 shows the amount of banked and projected RECs for the Swift River Hydro Projects through August 2015, as well as their estimated market value. The RMLD's total transmission costs for the month of August, 2015 were $1,309,072. This is increase of 10.85% from the July transmission cost of $1,180,976. In August, 2014 the transmission costs were $1,264,244. Table 6 Current Month Table 5 Last Year Peak Demand (kW) 153,225 RECs Summary 147,012 Energy (kWh) 72,813,758 Period. January 2015- August 2015 65,186,052 Banked Projected Total Est. $2,768,364 RECS RECs RECS Dollars Woronoco 836 1,514 2,350 $101,050 Pepperell 1,939 1,985 3,924 $168,732 Indian River 817 1,455 2,272 $97,696 Turners Falls 132 1,052 1,184 $0 Saddleback 1087 1,138 2,225 $95,675 Jericho 0 0 0 $0 Sub total 4,812 7,144 21,955 I RE5old 6 0 $0 Grand Total 4,811 7,144 11,955 $463,153 The RMLD's total transmission costs for the month of August, 2015 were $1,309,072. This is increase of 10.85% from the July transmission cost of $1,180,976. In August, 2014 the transmission costs were $1,264,244. Table 6 Current Month Last Month Last Year Peak Demand (kW) 153,225 156,283 147,012 Energy (kWh) 72,813,758 72,163,068 65,186,052 Energy ($) $3,269,589 $3,486,210 $2,768,364 Capacity ($) $1,723,853 $1,536,212 $1,414,711 Trdnsmisslon($) $1,309,072 $1,180,976 $1,264,244 Total $6,302,514 $6,203,397 $5,447,319 R k \ "■ k# «# §n �§ f(! ....., # -- -- -- .. . -�� |3. .. .. ! -- -- -- #■ ! .- § § ! !!!| .. .. 1 §!! |§ ! .. � |§ „ ;I ; ; ;�/ l� - -. -- . ®- I$( $2 )( �, ■ ' ......... { t . . ■!!!!!! ■ ■! \ ! §I §[ §[ �| .. �§ ....., -�� �| !!!| §!! |§ ! .. � |§ „ ;I ; ; ;�/ ' ......... j! t ■!!!!!! ■ ■! !!!!!!!!!| �| .. r ■,r „! „■ !!!!|! | |!| ! . !§|if | :gvv \|� :...... ; ;\ j�t • ;' ; ; ; ;.: ! ! ■ ■ ; ; ; ; ;�,!! To: Coleen O'Brien From r, \- Maureen McHugh, lane Parenteaul Date: October 22, 2015 111111 Subject: Purchase Power Summary - September, 2015 Energy Services Division (ESD) has completed the Purchase Power Summary for the month of September, 2015. 1:140:111111114 The RMLD's total metered load for the month was 62,521,903 kWh, which is a 6.04% increase from the September, 2014 figures. Table 1 is a breakdown by source of the energy purchases. Table 1 Amount of Cost of %of Total Total $ $ as a Resource Energy Energy Energy Costs (kWh) ($ /Mwfi) Millstone #3 3,531,210 $6.71 5.62% $23,694 0.72% Seabrook 5.225,265 $6.69 8.31% $34,937 1.06% Stonyorook Intermediate 3,723,083 $53.89 5.92% $200.653 6.08% Shall Energy 10,166,400 $69.84 16.17% $709,979 21.50% Ne #Era 8,314,000 $53.02 13.23% $440,792 13.35% NVPA 2,109.323 $4.92 3.36% $10,378 0.31% ISO Interchange 9,623,685 $68.00 15.31% $654,413 19.82% NEMA Congestion 0 $0.00 0.00% $291,038 8.81% Coop Resales 22,131 $149.36 0.04% $3.305 0.10% BP Energy 9,516,000 $47.73 15.14% $454,199 13.75% Hydro Projects' 346,814 $83.51 0.55% $28,963 0.88% Braintree Watson Unit 637,672 $60.25 1.01% $38,418 1.16% Saddleback Wind 628,046 $90.25 1.00% $58,682 1.72% Ezelon 8,986.400 $39.47 14.29% $354,689 10.74% Stonybrook Peaking 34,201 $0.00 0.05% $0 0.00% Monthly Total 62,864,230 $52.53 100.00% $3,302,140 100.00% *Pepperell, Womn000, Indian River, Turner Falls, Collins, Pioneer, Hosiery Mills, Summit Hydro Table 2 breaks down the ISO interchange between the DA LMP Settlement and the RT Net Energy for the month of September, 2015. Table 2 Saddlebacl 1.04 Braintree Wat Unk, 1.0% Hydro Projects, 0.6% NYPA, 3 .4`1 9% Amount Cost %of Total Resource of Energy of Energy Energy (kWh) ($ /Mwh) ISO DA ILMP ` 11,120,774 $56.33 17.78% Settlement RT Net Energy" - 1,497,089 $23.68 -2.39% Settlement ISO Interchange 9,623,685 $68.00 15.39% (subtotal) ' Independent System Operator Day -Mead Locatlonal Marginal Pdw " Real Time Net Energy SEPTEMBER 2015 ENERGY BY RESOURCE Saddlebacl 1.04 Braintree Wat Unk, 1.0% Hydro Projects, 0.6% NYPA, 3 .4`1 9% CAPACITY The RMLD hit a demand of 154,933 kW, which occurred on September 9, at 4 pm. The RMLD,s monthly UCAP requirement for September, 2015 was 222,873 Ms. Table 3 shows the sources of capacity that the RMLD utilized to meet its requirements. Table 3 %of Amt of Energy Source Amount(kWs) Cost($AM- month) Total Cost$ %of Total Cost Millstone #3 4,950 34.80 $172,261 12.78% Seabrook 7,910 39.34 $311,208 23.080/a Stonybrook Peaking 24,981 2.01 $50,166 3.72% Stonybrook CC 42,925 7.77 $333,608 24.75% NYPA 4,019 4.19 $16,834 1.25% Hydro Quebec 0 0 $19,152 1.42% Ne#era 60,000 5.90 $354,000 26.26% Braintree Watson Unit 10,520 -8.52 - $89,646 -6.65% ISO -NE Supply Auction 65,566 2.75 $180,514 13.39% Hydro Projects 2,002 0.00 $0 0.00% Total 222,873 $6.04 $1,348,097 100.00% Table 4 shows the dollar amounts for energy and capacity per source Table 4 Cost of %of Amt of Energy Power Resource Energy Capacity Total cost Total Cost (kWh) ($IkWh) Millstone #3 $23,694 $172,261 $195,956 4.22% 3,531,210 0.0555 Seabrook $34.937 $311,208 $346,144 7.45% 5,225265 0.0662 Stonybrook lntermedlate $200,653 $333,608 $534,261 11.49% 3,723,083 0.1435 Hydro Quebec $0 $19,152 $19,152 0.41% - 0.0000 Shell Energy $709,979 $0 $709,979 15.27% 10,166,400 0.0698 Ne,dEra $440.792 $354,000 $794,792 17.10% 8,314.000 0.0956 • NYPA $10,378 $18.834 $27,212 0.59% 2,109,323 0.0129 ISO Interchange $654,413 $180,514 $834,927 17.96% 9,623,655 0.0868 Nema Congestion $291.038 $0 $291,038 6.26% - 0.0000 SP Energy $454,199 $0 $454,199 9.77% 9,516,000 0.0477 • Hydro Projects $28,963 41,305 $27,658 0.59% 346,814 0.0798 Braintree Watson Unit $38.418 489,646 - $51,229 -1.10% 637.672 -0.0803 • Saddleback Wind $56.682 $0 $56,682 1.22% 628,046 0.0903 Coop Resales $3,305 $0 $3,305 0.07% 22,131 0.1494 Ez n Energy $354,689 $0 $354,689 7.63% 8,986.400 0.0395 Stonybrook Peaking $0 $50,166 $50,166 1.08% 34,201 1.4668 Monthly Total $3,302,140 $1,346,792 $4.648,932 100.00% 62,864,230 0.0740 Renewable Resources 4.91% RENEWABLE ENERGY CERTIFICATES (RECs) Table 5 shows the amount of banked and projected RECs for the Swift River Hydro Projects through September 2015, as well as their estimated market value. TRANSMISSION The RMLD's total transmission costs for the month of September, 2015 were $1,284,290. This is a decrease of 1.89% from the August transmission cost of $1,309,072. In September, 2014 the transmission costs were $1,149,000. Table 6 Current Month Table 5 fast Year Peak DemaM(kW) 154,933 RECS Summary 150,405 Energy (kWh) 62,550,094 Period - January 2015 - September 2015 58,966,269 Banked Projected Total Est. $2,358,566 RECS RECS RECS Dollars Woronow 836 1,514 2,350 $101,050 Pepperell 1,939 2,038 3,977 $171,011 IMw River 817 1,504 2,321 $99,803 Turners Falls 132 1,056 1,188 $0 Saddleback 1087 1,452 2,539 $109,177 lerkho 0 0 0 $0 Sub total 1, REG Sold 0 $0 Grand Total 4,811 7,564 12,375 $481,1141 TRANSMISSION The RMLD's total transmission costs for the month of September, 2015 were $1,284,290. This is a decrease of 1.89% from the August transmission cost of $1,309,072. In September, 2014 the transmission costs were $1,149,000. Table 6 Current Month Last Month fast Year Peak DemaM(kW) 154,933 153,225 150,405 Energy (kWh) 62,550,094 72,200,480 58,966,269 Energy ($) $3,302,140 $3,269,589 $2,358,566 Capac6y($) $1,346,792 $1,723,853 $1,419,977 Transmission($) $1,284,290 $1,309,072 $1,149,000 Total $5,933,222 ;6,302,514 $4,927,542 k / `# i ■ !K }• }, . | �■; 7((. - !.. . | ! „. .. _!! !� }§ .. . -- §2. - -\� -- § !!, ! - R¥ !WO` ■¥ #m §t� \\ \ \ || : \ :-22; ■KN ■!!, ■ ■, , § j !!!!!!!!!| ■ fk . | , \ |t III :II ^ \~ TIT .� . |! . .. \0 . A\) \i 9\ |; ) �l 11 Is A �• }• }, . | | ! ■�,., _!! !� }§ \\ \ \ || : \ :-22; ■KN ■!!, ■ ■, , § j !!!!!!!!!| , \ |t III :II IPill TIT |! .. . |; �l 11 Is A !! | |! | | |!| | � . ! ||K,■!, ■, |. " �|| : ;Ij ;j9I ! ! ■ ■!, ■!! ;!!! 012,09 W O IAWtl_I /I, VI • O Lot n4; C d C 0. O � G r U a o q N C1 D � y h C O .W. 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C � (D N E -00 o V a) v p 'E � O O U c � o Z V u O b° CL C O Q N N P } C O Q O M n E n N `o C_ a E w E" m N a' N V c a ^C W C c O a N Q N Ln N O N O O N V ° a a 0 s 4d �d S v v � � o o '^ • a U U o • o a � e 0 VJ g 2' IUI 0 ti II •ICI y rN Z rN yV C o ►•I Z O C• G% N V o ~ I�i � 0 .� SR POO �a.000saos.s.ae. °s�smrs= �aP� Ln N O N O O N V ° a a N pO[ ?[C i U O p U � o G o � a `a F di a a ti ^I v g S 8 8 s N pO[ ?[C i U O p U � o G o � a `a F di a a ti ^I v g S 8 8 N O N O N O N LL_ Q N C O Ga[ h G v E o G U o F z a ti ffi t c � o u i I a W, v 3 _T a a c u U R U m 0 O { .g V i d { .g V i (%• h i 0 H x READING MUNICIPAL LIGHT DEPARTMENT Engineering and Operations Monthly Report August 2015 CAPITAL IMPROVEMENTS Construction Projects: % complete Status Month YTD 102 Pole Line Upgrade - Lowell Street, Wilmington 82% $23,611 $37,964 104 Upgrade Old Lynnfield Center URDs (Cook's Farm) 75% $12,435 $42,884 105 4W5-4W6 Tie 5% $8,001 $8,001 106 URD Upgrades — AII Towns On -going $777 $777 107 StepdownAreaUpgrades — AII Towns On -going $1,390 $1,390 212 West Street— Force Account, Reading 95% $51,111 $95,351 New Customer Service Connections: 113 Service Installations — Residential: This item includes new or upgraded overhead and underground services. On -going $8,589 $23,041 Special Projects/Capital Purchases: 116 Transformers & Capacitors n/a $26,150 $26,150 117 Meter Purchases /500 Club Mesh Network Pilot 100% $2,387 $2,387 131 LED Street Light Conversion 13% $44,362 $59,632 October 22, 2015 1 Routine Construction Aug YTD Pole Setting/Transfers 35,079 56,483 Overhead /Underground 34,066 65,945 Projects Assigned as Required • Main Street (area upgrade), North Reading • McDonald Road Conversion, Wilmington • Tecomet, Ballardvale Street, Wilmington • Killiam School, Reading 11,347 32,389 Pole Damage /Knockdowns • Work was done to repair or replace two (2) poles 412 9,431 Station Group 0 0 HazmatfOil Spills 0 0 Porcelain Cutout Replacement Program 804 2,060 Lighting (Street Light Connections) 241 512 Storm Trouble 17,912 17,912 Underground Subdivisions (new construction) • Pebble Cove, Lynnfield • Rahnden Terrace, North Reading 3,703 7,704 Animal Guard Installation 0 484 Miscellaneous Capital Costs 13,012 33,629 TOTAL: $ 116 575 $ 226.558 October 22, 2015 MAINTENANCE Aged/Overloaded Transformer Replacement through August 2015 Padmount: Single- Phase: 13.31% replaced (of those over 20 years old) Three - Phase: 8.97.016 replaced (of those over 20 years old) Overhead: Single- Phase: 11.31% replaced (of those over 20 years old) Three - Phase: 3.89% replaced (of those over 20 years old) Pole Testing System -wide (600 -1,000 poles /year) (as of 10/20115) Year -one inspection complete: 645 poles tested ( -10 %) . 390 silver tag (PASSED) * 191* red tag (FAILED): 101 have been replaced . 22 double red tag (CONDEMNED): 22 have been replaced 67 of 123 transfers have been completed *42 red tag (failed) poles were revaluated and removed from the list. Double Poles (as of 1019/15) Total # of Double Poles: 502 Pending RMLD Transfer: 52 Lynnfield - 41 Reading - 135 North Reading —127 Wilmington —199 13.8kV/35kV Feeders — Quarterly Inspections As part of the feeder gathering project for the reliability project 7 /1 /15- present: 5W8, 5W9, 5W5, 4W10, 5W4, 4W28, 4W5, 4W6, 3W8, 3W18, 4W13 Manhole Inspections Pending. Porcelain Cutout Replacements (with Polymer) As of August 31, 2015, there are 273 remaining porcelain cutouts to be replaced. 90% complete. Tree Trimming 288 spans were completed in August. YTD thru August — 605 spans have been complete. Substations: Infrared Scanning (Monthly) Station 3 Scanning complete through August — no hot spots found Station 4 Scanning complete through August — no hot spots found Station 5 Scanning complete through August — no hot spots found Substation Maintenance Program . Inspection of all three stations by UPG complete. October 22, 2015 SYSTEM RELIABILITY Key industry standard metrics have been identified to enable the RMLD to measure and track system reliability. SAIDI (System Average Interruption Duration Index) is defined as the average interruption duration (in minutes) for customers served by the utility system during a specific time period. SAIDI = the sum of all customer interruption durations within the specified time frame + by the average number of customers served during that period. SAIDI 2010-2015 Minutes 100.00 90A0 85.75 2010 80.00 70.00 58.84 2011 60.00 62.35 X2012 50.00 40.00 2013 30.00 e>• 2014 20.00 2015 YTD 10.00 — Region Average 000 2010 - 2011 - 2012 - 2013 - 2014 -2015 National Average Average SAIDI CAIDI (Customer Average Interruption Duration Index) is defined as the average duration (in minutes) of an interruption experienced by customers during a speck time frame. CAIDI = the sum of all customer interruption durations during that time period + the number of customers that experienced one or more interruptions during that time period Minutes CAIDI 2010 -2015 300.00 259.97 250.00 200.00 150.00 100.00 50.00 0.00 2010- 2011 - 2012 - 2013 - 2014 -2015 Average CAIDI 11111111111112010 e 2011 e� 2012 X2013 105.77 83.00 X2014 ae>• 2015 YrD — Region Average National Average This metric reflects the average customer experience (minutes of duration) during an outage. October 22, 2015 4 SAM (System Average Interruption Frequency) is defined as the average number of instances a customer on the utility system will experience an interruption during a specific time period. 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 SAIFl = the total number of customer interruptions + average number of customers served during that period. SAIFl 2010 -2015 2010- 2011 - 2012 - 2013 - 2014 -2015 Avenge SAIFl 0.93 0.55 1M111 2010 eer♦2011 eae 2012 MEMO 2013 a 2014 can 2015 YrD — Region Average - -- National Average Note: Since SAIDI, SAIFl and CAD are sustained interruption indices; only outages lasting longer than one minute are included in the calculations. October 22, 2015 5 Outages Causes Calendar YTD (from eReliability website) Jan -Aug 2015 ,mkw Hu—Er- outage cause count vn.t rmxm ^.mtte Equ�I la4 October 22, 2015 v4wft 17 T- 37% Vehkk AccWent Total 100 READING MUNICIPAL LIGHT DEPARTMENT Engineering and Operations Monthly Report September 2015 CAPITAL IMPROVEMENTS Construction Projects: Complete status Month YM 102 Pole Line Upgrade - Lowell Street, Wilmington 82% $35,770 $73,734 104 Upgrade Old Lynnfield Center URDs (Cook's Farm) 75% $20,195 $63,078 105 4W5 -4W6 Tie 5% $612 $8,613 106 URD Upgrades —All Towns On -going $518 $1,295 107 StepdownAreaUpgrades — AII Towns On -going $772 $2,162 212 West Street— Force Account, Reading 95% $37,348 $132,699 New Customer Service Connections: 113 Service Installations — Residential: This item includes new or upgraded overhead and underground services. Ongoing $9,384 $32,424 Special Projects /Capital Purchases: 116 Transformers & Capacitors n/a $113,057 $139,207 131 LED Street Light Conversion 13% $51,868 $111,500 October 22, 2015 1 Routine Construction Sep YTD Pole Setting(rransfers 23,252 79,735 Overhead /Underground 23,417 89,362 Projects Assigned as Required • Tecomet, Ballardvale Street, Wilmington • Main Street (area upgrade), North Reading • Killiam School, Reading • Solar Project, Ballardvale, Wilmington • Artis Living, Main Street, Reading • Jacquith Road, Wilmington • Charles Street area upgrade), North Reading 39,943 72,332 Pole Damage /Knockdowns 01 9,431 Station Group 0 0 Hazmat/Oil Spills 0 0 Porcelain Cutout Replacement Program 1,204 3,265 Lighting (Street Light Connections) 2,083 2,595 Storm Trouble 414 18,326 Underground Subdivisions (new construction) • Pebble Cove, L nnfield 1,558 9,262 Animal Guard Installation 578 1,063 Miscellaneous Capital Costs 49,277 82,906 TOTAL: $ 141.727 $ 368.276 October 22, 2015 MAINTENANCE PROGRAMS Aged /Overloaded Transformer Replacement through September 2015 Padmount: Single- Phase: 14.29% replaced (of those over 20 years old) Three - Phase: 8.97% replaced (of those over 20 years old) Overhead: Single- Phase: 11.38% replaced (of those over 20 years old) Three - Phase: 4.44% replaced (of those over 20 years old) Pole Testing System -wide (600 -1,000 poleslyear) (as of 10120/2015) Year-one inspection complete: 645 poles tested ( -10%) . 390 silver tag (PASSED) . 191* red tag (FAILED): 101 have been replaced . 22 double red tag (CONDEMNED): 22 have been replaced 67 of 123 transfers have been completed *42 red tag (failed) poles were revaluated and removed from the list. Double Poles (as of 10/9115) Total # of Double Poles: 502 Pending RMLD Transfer: 52 Lynnfield - 41 Reading -135 North Reading -127 Wilmington -199 13.8kV /35kV Feeders - Quarterly Inspections As part of the feeder gathering project for the reliability project 7/1/15- present: 5W8, 5W9, 5W5, 4W10, 5W4, 4W28, 4W5, 4W6, 3W8, 3W18, 4W13 Manhole Inspections Pending. Porcelain Cutout Replacements (with Polymer) As of September 30, 2015, there are 270 remaining porcelain cutouts to be replaced. 90% complete. Tree Trimming 320 spans were completed in September. YTD thru September - 925 spans have been completed. Substations: Infrared Scanning (Monthly) Station 3 Scanning complete through September- no hot spots found Station 4 Scanning complete through September - no hot spots found Station 5 Scanning complete through September - no hot spots found Substation Maintenance Program . Inspection of all three stations by UPG complete. October 22, 2015 SYSTEM RELIABILITY Key industry standard metrics have been identified to enable the RMLD to measure and track system reliability. SAIDI (System Average Interruption Duration Index) is defined as the average interruption duration (in minutes) for customers served by the utility system during a specific time period. SAIDI = the sum of all customer interruption durations within the specified time frame + by the average number of customers served during that period. SAIDI 2010 -2015 Minutes 100.00 90.00 85.75 80.00 ONE 2010 70.00 59.61 � 2011 60,00 62.35 50.00 ONE!! 2012 40.00 � 2013 30.00 2014 20.00 10.00 � 2015 YrD 0.00 — Region Average 2010- 2011 - 2012 - 2013 -2014- 2015 National Average Average SAIDI CAIDI (Customer Average Interruption Duration Index) is defined as the average duration (in minutes) of an interruption experienced by customers during a specific time frame. CAIDI = the sum of all customer interruption durations during that time period + the number of customers that experienced one or more interruptions during that time pe rains 7nin-m15 Minutes 300.00 250.00 rr rr 150.00 100.00 50.00 0.00 2010 -2011- 2012 - 2013 - 2014 -2015 Avenge CAIDI 252.86 X2030 ear• 2011 a 2012 X2013 105-77 8100 � 2014 SUM 2015 YTD — Region Average National Average This metric reflects the average customer experience (minutes of duration) during an outage. October 22, 2015 4 SAM (System Average Interruption Frequency) is defined as the average number of instances a customer on the utility system will experience an interruption during a specific time period. 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 SAIFI = the total number of customer interruptions + average number of customers served during that period. SAIFI 2010 -2015 2010 -2011- 2012 -2013- 2014 -2015 Average SAM 0.83 X2010 11111111111112011 0.55 X2012 X2013 e� 2014 2015 YTD — Region Average - National Average Note: Since SAIDI, SAIFI and CAIDI are sustained interruption indices; only outages lasting longer than one minute are included in the calculations. October 22, 2015 5 Outages Causes Calendar YTD (from eReliability website) )an-Sept. 2015 dy ` vmae amomi �w to 17% Equgrcnl )6Y October 22, 2015 Outage Cause count T,K nx Whale Accident Total 115 RMLD COj REad g Muwvcipal Light Deparsmcnt BL [l p00. G[N 8RAi50N5 290 Ash Street P.O. Box 150 Reading, MA 01867 -0250 Tel: (781) 904-1340 Fax: (781) 942 -2409 Web: w ...dd.. October 16, 2015 Town of Reading Municipal Light Board Subject: Remediation, Transportation, and Disposal of Hazardous Waste On September 23, 2015 a bid invitation was placed as a legal notice in the Middlesex East section of the Daily Times Chronicle and in the Commonwealth of Massachusetts Goods and Services Bulletin on Monday, September 21, 2015 requesting proposals for Remediation, Transportation, and Disposal of Hazardous Waste for the Reading Municipal Light Department. An invitation to bid was emailed to the following: ENPRO Triumvirate Environmental TSI Transformers Service, Inc. US Ecology TCI of NY, LLC Transformer Decommissioning, Inc. Casella W.L. French Eastern Environmental Technologies Clean Venture, Inc. TM Environmental RC & D, Inc. Pennoni Bids were received from ENPRO, Triumvirate Environment and New England Disposal Technologies. The bid was publicly opened and read aloud at 11:00 a.m. October 16, 2015 in the Town of Reading Municipal Light Department's Board Room, 230 Ash Street, Reading, Massachusetts. The bid was reviewed, analyzed and evaluated by the General Manager and the staff. Move that bid 2016-03 for Remediation, Transportation, and Disposal of Hazardous Waste be awarded a contract to: ENPRO for a three year period ending November 30, 2018 for an estimated cast of $150,000 as the lowest qualified bidder on the recommendation of the General Manager. File: Bid /FY16/2016-03 Remediation, Transportation, and Disposal of Har doaa Waste Attachment 5 � R ading Municipal D partment RMLD aeueaLe eomea eoe neneannons —/ 230 Ash Simi, P.D. Box 150 Rcading, MA 01867 -0250 The award of this bid provides for Hazmat Remediation services as required. This will be done under the direction of the RMLD Licensed Site Professional. Colee O'Brien Nti He mid Jaffari Nick D'Alleva File: Bid /FY16/2016.03 Remediation, Trmssporfation, and Disposal of Hazmat Disposal Jeanne Foti From: Jeanne Foti Sent: Thursday, October 22, 2015 12:50 PM To: RMLD Board Members Group Subject: Account Payable and Payroll Questions Good afternoon. In an effort to save paper, the following timeframes had no Account Payable and Payroll questions. Account Payable Warrant — No Questions September 18, September 25, October 2, October 9 and October 16. Payroll — No Questions September 21, October 5 and October 19. This e-mail will be printed for the Board Packet for the RMLD Board meeting on October 29, 2015. Jeanne Foti Reading Municipal Light Department Executive Assistant 230 Ash Street Reading, MA 01867 781- 942 -6434 Phone 781- 942 -2409 Fax Please consider the environment before printing this e-mail. ! | . - •. !,, !.: HE ;!| ■. ,!! §! i ;! |!r �)§ | |) || f ;� § ;• ,_ „ ° :• §!| w! � ;) !=a .�! 4!- • HI /|� ||(| ! ! ova !!! §, e� ;j§ § || ; §, ;� 2 #• 4. . |!! �! ,,- . ; ■!( �!! . / R ; ©. ( ;;6: =_, ! 167 . . ;..� /j \)