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Board - Committee - Commission - Council:
RMLD Board of Commissioners
Date: 10-20-2016
Building: Reading Municipal Light Building
Address: 230 Ash Street
Purpose: General business.
Attendees: Members - Present:
RECEIVED'
TOWN CLERK
RE>^,OING, MASS:'
1011 AMS 21 P 23b1
Time: 7:30 PM
Location: Winfred Spurr Audio Visual Room
Session: Open Session
Version: Final
Thomas O'Rourke, Chairman, Philip B. Pacino, Vice Chair, John Stempeck,
Secretary Pro Tem, David Talbot -Remote Participation
Members - Not Present:
Dave Hennessy, Commissioner -Absent
Others Present:
Coleen O'Brien, Jeanne Foti
Hamid Jaffari, Jane Parenteau
Tracy Schultz,
Dennis Kelley, CAB Member
Frank Biron & Zack Fentross, Melanson Heath & PC
Minutes Respectfully Submitted By: Philip B. Pacino, RMLD Board Chairman
Topics of Discussion:
Call Meeting to Order
Chairman O'Rourke called the meeting to order and announced that the meeting is a live broadcast in the Town of
Reading. Due to technical limitations, the meeting is also being videotaped for distribution at community
television stations in North Reading, Wilmington and Lynnfield.
Opening Remarks
Chairman O'Rourke read the RMLD Board of Commissioners Code of Conduct and announced that Mr. Hennessy
would not be in attendance that evening. Since Mr. Talbot would be participating in the meeting remotely, via
conference call, all votes must be done by roll call per Massachusetts Open Meeting Law. Mr. Talbot confirmed via
speakerphone that he was on the line and able to hear what was being discussed at the meeting.
Introductions
Chairman O'Rourke then acknowledged the presence of CAB representative Dennis Kelley and asked Mr. Stempeck
to serve as Board Secretary, to which Mr. Stempeck agreed. Chairman O'Rourke suggested starting with the Audit
presentation, and invited Frank Biron and Zachary Fentross, from Melanson Heath & PC, to take the floor.
Presentation of Fiscal Year 2016 Audit (Attachment 1)
Melanson Heath & PC, Frank Biron Zackary Fentross
Frank Biron, President, Melanson Heath, introduced himself and Zachary Fentross, the supervisor who performed
the RMLD audit. Mr. Biron explained that he would be going over highlights from the June 30, 2016 financial
statements and directed the Commissioners' attention to the Independent Auditors' Report. Mr. Biron stated that
his firm was hired to provide an opinion on RMLD's financial statements. RMLD was given a clean opinion, which is
the best opinion that can be received from an independent outside audit; RMLD's financial statements were in
accordance with generally accepted accounting principles.
Page 1 1
Presentation of Fiscal Year 2016 Audit (Attachment 1)
Melanson Heath & PC, Frank Biron Zackary Fentross
Mr. Biron then referenced the Statement of Net Position, which summarizes the assets, liabilities, and the equity of
the Department as of June 30, 2016, RMLD's numbers, between 2015 and 2016, were consistent and strong. The
Department is in a very strong financial position and is consistent with past years. The unrestricted cash balance of
about $13 million in 2016, was the same as the previous year. Receivables totaled $8 million, which is not a large
amount considering overall revenues are $80 million. Approximately one month's worth of revenues is sitting in
receivables, most of this $8 million is unbilled. There are very few delinquent accounts, the Department has done a
good job collecting receivables.
Mr. Biron continued, stating that the number that changed the most from the previous year was net pension
liability, which doubled. This was due to the town's retirement investments performing worse than expected, a
downturn that was beyond RMLD's control. In 2016, the net pension liability was $8,833,549 compared to 2015
when it was about
$4.5 million -it almost doubled. This increase in liability was due to investment results of the town's retirement
system not meeting anticipated targets. The earnings goal was 7 % % earnings, while the actual earnings were only
%. RMLD's net pension liability represents the Department's proportionate share of the town's overall liability.
Mr. Biron continued, pointing out that the RMLD has no bonds payable, which puts the Department in a strong
financial position. Additionally, all the Department's capital assets, which are in excess of $72 million, have been
acquired through the rate process.
No liability is being reported for OPEB (Other Post -Employment Benefits) because the Department has been
setting aside money into a trust fund equal to what the actuaries suggested. However, there is going to be a
change in accounting standards in two years. In 2018, Government Accounting Standard Board (GASB) Statement
75 will replace GASB Statement 45, and will require that the entire actuarially calculated liability of OPEB (health
employment benefits for retired employees) be reported, just as the net pension liability is currently reported. If
there is no additional funding, the unfunded amount, that is not currently shown on RMLD's financial statements,
but will in two years, will appear as a $6 million liability.
Mr. Biron then referred to the Statement of Revenues, Expenses, and Changes in New Positon. The numbers were
consistent with the previous year, with revenues up despite the number of kilowatt hours sold going down about 2
percent. This was due to rate increases in response to the cost to purchase power increasing. All other revenues
and expenses were also consistent. The Department's net income (what revenues beat expenses by) was
$3,369,404. This was similar to the previous year. Since the state sets the income limit of municipal utilities to
eight percent of the value of fixed (capital) assets, $3 million is almost at the maximum of what the Department
can earn. There was only $300,000 left in possible earnings, giving the Department a strong bottom line.
Fiduciary funds are monies set aside for future pension costs and future OPEB costs. What RMLD put into the
pension trust was close to what was paid out to the town's retirement system, about $1.5 million. That leaves $5.6
million set aside in the RMLD trust fund. The OPEB trust took in $308,000 from operations, which is the amount
that actuaries recommended be set aside. That plus investment results of $14,000 equaled an increase of
$322,000, which means $2.5 million set aside for OPEB costs. However, the unfunded $6 million must be reported
in two years.
Mr. Biron concluded that RMLD's numbers are strong. Cash balance receivables are in good shape and the
Department has very little debt. The financial department did a good job closing its books in a timely manner -this
is the first municipal audit that Melanson Heath completed this year. The accounting records are in good shape
and the Department did a good job handling changes in the financial department.
Report of the Committee, Audit Committee -Vice Chair Pacino
Mr. Pacino reported that the Board of Commissioners' Audit Committee, which consists of himself and Mr.
Stempeck, plus four members of the Audit Committee of the Town of Reading (himself, a representative from the
Board of Selectmen, a representative from the Town's Finance Committee, and an at -large member), reached a
quorum and recommended that the Commission accept the Audit as presented. The vote of the Board was 2:0; the
vote of the Town Audit Committee was 4:0.
Page 1 2
Report of the Committee, Audit Committee -Vice Chair Pacino
Mr. Pacino made a motion, seconded by Mr. Stempeck, that the Board of Commissioners accept the Audit Report
from Melanson Heath, Fiscal Year ended June 30, 2016 as presented.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye.
Motion carried 4:0:0.
Public Comment
No public comment.
Report of the Chairman, Board Response to NEPPA
Chairman O'Rourke explained that there had been concern from one of the Commissioners regarding a climate
change denialist who spoke at the NEPPA conference this year. A communication has been received back from
NEPPA and Chairman O'Rourke will now send a response. Chairman O'Rourke asked Mr. Talbot if he had any
comments to add. Mr. Talbot reiterated that he was dismayed that NEPPA had hosted a speaker who proliferated
misinformation about a very important topic but is pleased that there will be a Board response to the letter from
NEPPA. Chairman O'Rourke reiterated that he would be writing a closure response.
RMLD Citizens' Advisory Board Meeting
Chairman O'Rourke stated that the absent Mr. Hennessy attended the CAB meeting on October 12, 2016.
Chairman O'Rourke then invited Mr. Kelley to provide updates from that meeting. Mr. Kelley stated that the CAB
was wondering how many of the Commissioners had enrolled in the solar program.
Chairman O'Rourke stated that he had spoken with Mr. Hennessy, who had reported that there was discussion at
the CAB meeting in regards to the Town of Reading not having a CAB representative. Chairman O'Rourke then
inquired if any of the Board members knew the process and the next step for getting that position filled.
Mr. Pacino explained that the Town posts the vacancy. Mr. Pacino then made an appeal to the residents of
Reading, asking that someone please volunteer. The idea of the CAB is to represent the ratepayers, help the Town
of Reading, and give the Board of Commissioners input. Currently, the electric customers of Reading aren't
represented.
Mr. Kelley voiced his concern that being short one person means that the CAB cannot get a quorum if one of the
current members cannot attend a meeting. Chairman O'Rourke stated that Mr. Hennessy has a few possible
recommendations and Ms. O'Brien said that she will soon be meeting with Reading's Town Manager and will
reiterate the need for a Reading volunteer on the Citizens' Advisory Board. Mr. Pacino then emphasized that there
is no special training required to be on the CAB -only general knowledge is needed to represent the ratepayers.
General Manager's Report (Attachment 2)
Ms. O'Brien reported that RMLD's Open House was held on Thursday, October 6 from 2 p.m. to 5 p.m., in
conjunction with Public Power Week. The event was well attended and was a great success. Ms. O'Brien stated
that she is always looking for feedback to make it better and that there were lots of educational tools available -
kids liked the linemen and bucket truck rides but there was also information about solar and electric vehicles.
Chairman O'Rourke remarked that he stopped by and that the event was very well-done: it was a great family day
for kids and grandkids and there was a pole install. Ms. O'Brien added that the event was both educational and
tactile.
Ms. O'Brien continued, announcing that the revised art contest for students is in full swing. In previous years,
RMLD ran a t -shirt design contest. This year is now an art contest: third graders from each town in the service
territory were given watercolor paper and pencils and educational materials. The theme is Shred the Peak. The
contest schedule will be the same as the t -shirt design contest of past years -winners will be announced the second
Thursday of January. This year a print will be made of the winning works of art and they will be displayed in
recycled frames in the RMLD building. There will also be a reception. The number of winners and the prizes for the
schools have been increased. The hope is to implement a second phase of the art contest with local high schools
and different types of mediums for more art. The intention is to keep the whole school system educated and
promote conservation.
Page 1 3
General Manager's Report (Attachment 2)
Chairman O'Rourke asked if there would still be a calendar. Ms. O'Brien replied that the historic calendar is in the
proofing process and will be coming out in November. Chairman O'Rourke asked if a calendar similar to the t -shirt
calendar of past years would be produced. Ms. O'Brien answered yes, RMLD would be issuing a calendar with the
winners' artwork on it, as had been previously done with the t -shirts.
Ms. O'Brien announced that the Town of Reading Holiday Tree Lighting will be held on November 27 from 2 p.m.
to 4:30 p.m. in Reading Center. Additionally, the towns need to check their strands of holiday lights-RMLD will
replace any that are no longer working.
Quarterly Update Organizational and Reliability Report
Mr. Jaffari reported that Organizational and Reliability studies were conducted in 2015 by Leidos and Booth and
Associates, respectively. The results of the Organizational Study were 17 areas that Leidos felt needed attention.
Recommendations were made. The Booth and Associates Reliability study identified 45 areas that demanded
addressing. These 45 were combined with the results of a study performed on the substations by Booth and
recommended by UPG, for a total of 71 recommendations. To date, 22 out of these 71 recommendations have
been completed -7 of those 22 have been completed since the last report. RMLD is on target and on track, with
many of the recommendations in progress and with repairs being made.
Chairman O'Rourke remarked that was a lot of progress. Mr. Jaffari concurred, stating that RMLD is getting a lot
done.
Mr. Jaffari then addressed the Organizational Study updates. The goal of the study was to compare RMLD's
business model to best business practices, which identified 17 areas that needed attention, as presented by Mr.
Jaffari, are:
1. Establish Planning Culture: New organization requires new strategic planning, which will be completed in 2017.
The last strategic plan was completed in 2008. The Six Year Plan is being presented to the board annually and
spending is being planned. The IRD group has a plan in progress. The system planning, which includes the GIS
technology roadmap and 20 -year planning study, is done.
2. Develop an Effective Sustainable Workforce: Workforce development requires Leidos support; job descriptions
are currently being worked on. This goes hand in hand with Career Development Plans, which are given to Leidos,
with the necessary adjustments to the descriptions being made. Succession planning is being implemented.
However, there are still vacancies that need to be filled.
3. Improve Organizational Effectiveness: This is tied to the union negotiations that are underway: job descriptions
and career development plans have been updated, and therefore must be presented to the union, which has
slowed down the process. IRD has been completed, Engineering and Business Finances are in progress. External
communications to customers, such as Tweeting and e -mailing, has been implemented, with more programs in
progress. Communications to employees have also increased.
4. Develop Leadership Capabilities: Leadership training is ongoing and is tied to Career Development Plans. Staff
meetings are occurring, with management communicating with employees on a weekly basis. The General
Manager is meeting with communities to bring Town Managers/Administrators up to date with RMLD's activities.
S. Establish Project Management Culture: Project management policies and procedures are being developed.
Employees will be undergoing project management training to ensure that time and resource management are on
target.
6. Ensure Competitively Priced Services: Integrated Resources is educating customers on time of use, demand side
management, solar programs, and energy resources. The IRD has been doing a phenomenal job, as evidenced by
the new Solar Choice rate.
7. Improve Financial Planning and Risk Management: The review and updating of operations, negotiations, fuel,
OPEB, and sick time buyback processes in progress. Accounting and financial business processes are being
formalized.
8. Strengthen Safety Culture: Safety policies are being continuously reviewed and developed. There are two safety
committees -operational and general. All employees have an opportunity to participate and make
recommendations to make the work environment safer.
9. Diversify Resources: This involves crafting a roadmap for distributed generation. A 10 Year Plan has been
developed for solar battery storage and gas generation. It is being reviewed and assessed based on financial
realities. Additionally, the cost effectiveness of end-use measures is being evaluated annually.
Page 1 4
General Manager's Report (Attachment 2)
Quarterly Update Organizational and Reliability Report
10. Establish a Culture of Compliance: This requires Leidos support; Leidos is developing a plan.
11. Improve Customer Service: A service survey plan and customer communication plan for 2017 are being
developed.
12. Plan for Future Technologies: A technology roadmap for the next 15 to 20 years has been completed. An IRD
roadmap has also been developed.
13. Focus on Asset Management: Asset management plan involves integrating GIS and Cogsdale. Developing asset
management tracking; cost benefit analysis will then be performed. A customer service manual has been
developed and is on the website. The manual outlines customer and utility responsibilities.
14. Leverage Geographic Information Systems: A robust GPS -based inventory of assets and infrastructure is being
conducted and will be completed in 2017. CDM and Davey's Resource Group (DRG) are collecting GIS data and
developing a GIS model. This model will be converted to another model that engineering will use and will be
updated, analyzed, reviewed, and adjusted as needed.
15. Formalize and Enhance Work Management: A plan is being developed to streamline the work order
management system: MIS, CIS, and GIS will all work together. Leidos is assisting in developing short and long term
IT plans to eliminate redundancies and ensure cost efficiency.
Chairman O'Rourke asked if this required a new business system.
Mr. Jaffari responded yes, this will require new software. There may be some integration difficulties.
16. Plan for Resiliency: A disaster recovery plan and emergency operation procedures have both been completed.
Chairman O'Rourke asked if there was a recovery site if the building was not accessible. Mr. Jaffari explained that
most data are backed up in the Cloud.
17. Enhance Facilities: The fleet study is completed.
Power Supply Report -August 2016 -Ms. Parenteau (Attachment 3)
Ms. Parenteau began by stating that she would be reporting on the August power supply. There is a preliminary
indication that the ISO peak occurred on August 12, 2016 at 4 p.m. Over the last three years, RMLD's load was an
extremely small portion of ISO's peak compared to the total load: about 0.6 percent. In 2014 ISO peaked on July 23
at 5 p.m., in 2015 ISO's peak occurred on July 29 at 6 p.m. 2016 is the only recent year that our peak coincided
with ISO. In previous years, RMLD peaked at different hours. The "Shave the Peak" campaign targets ISO's peak,
not necessarily RMLD's peak. This year was relatively in line: every year our use during ISO's peak is about 0.64 %.
Moving forward, RMLD's future target is a significant decrease in that percentage. This will serve as the benchmark
for progress.
Ms. Parenteau then directed attention to real time pricing during the peak month of 2014, 2015, and 2016. The
last two summers real time prices were relatively flat. This year the peak went up about five percent, resulting in
volatile pricing. The price was about $300 dollars a megawatt hour, as opposed to the current price, which is
around $20 a megawatt hour. How did that effect RMLD? RMLD's portfolio cost and average fuel cost were
examined. Our sales totaled almost 69 million kWh, which is considerably higher than previous years' peak
months. The average cost per kwh is down to a little over 4.3 cents. Due to portfolio management, our generators
gave more to the system than what was used, and RMLD received payment for that. This is the advantage of
having the portfolio. Savings is passed along to customers through the fuel charge, which the Commissioners all
agreed was great.
Solar Choice Rate
Chairman O'Rourke remarked that the Solar Choice Rate was CAB approved on October 12, 2016.
Ms. Parenteau stated that the solar project has been in the works for about a year. Certain customers are unable
to install solar panels, so RMLD wanted to do a community shared solar project in the service territory. A one
megawatt- 1,000 kilowatt project is now located on Ballardvale Street in Wilmington. 500 customers will receive
the cost and the benefit of the solar project. The cost of the energy is fixed for a 20 -year term. When customers
sign up they are fixing a portion of their fuel charge for the next 10 years. Currently, in the first year the cost of
solar is slightly higher than the cost of RMLD's fuel charge, resulting in a small $5 per month premium for the first
12 months. A $3 or $4 credit is being forecast beginning in month 13. The solar achieves benefit during peak
period, and that capacity and transmission benefit go directly to the Solar Choice customers. A $300 net benefit is
currently being forecast over the 10 -year period. The $60 cost of the first year will be made up after the third year,
resulting in net positive. The rate has almost reached its enrollment goal, with a waiting list being established and
another project then being planned.
Page 1 5
Solar Choice Rate
Mr. Pacino made a motion, seconded by Mr. Stempeck, that the RMLD Board of Commissioners approve the Solar
Choice Rate MDPU 269 to be effective on billings after December 1, 2016 on the recommendation of the General
Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
Engineering and Operations Report -August 2016 -Mr. Jaffari (Attachment 4)
Mr. Jaffari presented the Engineering and Operations Report for August, 2016. RMLD spent $54,385 on Capital
Improvement Projects, bringing the year to date total to $94,196. Expenditures on Routine Construction for the
month of August were $191,849, bringing the year to date total to $324,827. Routine Maintenance transformers
replaced 21.24 percent of pad mount transformers and about 15 percent of overhead. The second round of pole
inspections was completed, with 187 poles being replaced.
Chairman O'Rourke asked if that was just for 2016. Mr. Jaffari answered in the affirmative. 670 poles have been
inspected, with approximately 30 percent failing the test. There have also been some condemned poles, which are
immediately replaced. 110 of 187 pole transfers have been completed. To date, 614 manhole inspections have
been
completed. Porcelain cutout replacements are 91 percent complete, with 256 remaining. 110 tree spans were
trimmed in August, bringing the year-to-date up to 176 spans. The August substation infrared scan showed no hot
spots. As for double poles: there are about 16,000 poles in RMLD's system, with 50 percent owned by Verizon and
50 percent owned by RMLD. Reading's ownership is similarly split. North Reading's poles are owned by RMLD,
while Lynnfield and Wilmington's poles are owned by Verizon. NJUNS shows what poles have issues and what
actions need to be taken to complete pole transfers. Lynnfield had 5 pending transfers in August. North Reading
had 16 pending transfers, 1 pending set, and 45 poles awaiting a pull. Reading had 55 pending transfers and 39
pending pull poles. Wilmington had 42 poles waiting for transfer, 4 pending pull poles and 1 guy install. Mr. Jaffari
explained that the numbers go up and down. RMLD tries to keep up with the transfers; it is a dynamic process.
Mr. Jaffari then addressed August's reliability indices. SAIDI was slightly over the regional average but well under
the national average. RMLD is still playing catch up with long overdue maintenance. 25 percent of YTD outages
have been due to equipment, 34 percent from trees, and 29 percent wildlife.
Mr. Kelley, referencing outage causes, commented that equipment failure was responsible for a larger portion of
outages between 2011 to 2016, as compared to just 2016. Mr. Kelley then asked if this reduction was due to the
new maintenance programs. Mr. Jaffari answered yes, RMLD has approximately 1,800 aged transformers and the
system has not been maintained for over 20 years. Some of the 40/45 year transformers have been replaced.
There have been some hairy situations that RMLD has caught before problems arose. It is a good program and
there is a lot to do in the next 10 years.
RMLD Procurement Requests Requiring Board Approval (Attachment 5)
IFP 2017-15 Capacitor Bank
Mr. Jaffari explained that RMLD needs to install more capacitors to stabilize voltage and to reduce system losses.
Mr. Stempeck remarked that it was surprising that only one bid was received. Mr. Jaffari replied that one other bid
was received, but since it was sent via e-mail and not as a sealed proposal it was rejected.
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-15 for Capacitor Bank be awarded to
WESCO for $54,480.00 pursuant to Chapter 164 § 56D on the recommendation of the General Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
IFP 2017-20 750 MCM Cable
Mr. Jaffari stated that three companies bid to supply getaway cables for substation. Booth and Associates
recommended beefing up said cables.
Mr. Pacino announced that he would be abstaining from the vote, citing a potential conflict of interest.
Page 1 6
RMLD Procurement Requests Requiring Board Approval (Attachment 5)
IFP 2017-20 750 MCM Cable
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-20 for 750 MCM Cable be awarded to
Arthur Hurley Company, Inc. for $104,513.10 pursuant to Chapter 164 § 56D on the recommendation of the
General Manager.
Chairman O'Rourke called for a poll of the vote:
Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye. Mr. Pacino: Abstained.
Motion carried 3:0:1.
IFP 2017-22 Single Phase Step Voltage Regulator
Mr. Jaffari stated that this will enable better voltage management. The boosters will address some issues RMLD
has been having with marginal voltage -regulators are needed to better manage and maintain voltage. This is a
proactive installation.
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-22 for Single Phase Step Voltage
Regulator be awarded to Graybar Electric for $146,090.00 pursuant to Chapter 164 § 56D on the recommendation
of the General Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
IFP 2017-2415kV Single Phase Submersible Transformers
Mr. Jaffari explained that these are temporary transformers that will be used when pad mount or underground
equipment needs to be switched out. The repairs can sometimes take days and this will ensure that customers
have electric service during the replacement. Mr. Stempeck remarked that it must be an interesting process. Mr.
Jaffari agreed, saying that it was not unlike performing bypass surgery.
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-24 for Single Phase Submersible
Transformers be awarded to Central Moloney, Inc. for $19,794.00 pursuant to Chapter 164 § 56D on the
recommendation of the General Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
IFP 2017-25 Control Devices for Substation 3
Mr. Jaffari said that there have been deficiencies at station 3 because the wrong equipment was originally
installed; it is obsolete. This new equipment will give more capability, better management of the substation load
and increased SCADA control.
Chairman O'Rourke inquired if there was a reason the bid was awarded to two companies.
Mr. Jaffari answered that there are several items involved: some went to one bidder; some went to the other.
Chapter 164 allows RMLD to pick and choose.
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-25 for Control Devices for Substation 3
be awarded to WESCO for $62,866.00 and Graybar Electric for $64,401.28 for a total cost of $127,267.28 pursuant
to Chapter 164 § 56D on the recommendation of the General Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
IFS 2017-28 Material Handle with Trade -In
Mr. Jaffari explained that per Chapter 164 the award didn't have to go to the lowest bidder. 3 bidders replied; the
lowest took too long to respond and was thus not eligible; the long second lowest was from a bidder who uses
parts from different manufacturers and then assemble them together. This leads to the warranty becoming an
issue as none of the manufacturers of said parts want to take ownership for any problems if something goes
wrong. Therefore, the bid is being awarded to a company that makes and assembles its own parts so that there is
one warranty and if any problems arise they will come and fix the issue onsite.
Page 1 7
IFB 2017-28 Material Handle with Trade -In
Mr. Pacino made a motion seconded by Mr. Stempeck that proposal 2017-28 for one Material Handler with Trade -
In be awarded to James A. Kiley Company for $221,715.00 pursuant to M.G.L. c. 164 § 56D on the
recommendation of the General Manager.
Chairman O'Rourke called for a poll of the vote:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
General Discussion
There was none.
BOARD MATERIAL AVAILABLE BUT NOT DISCUSSED
E -Mail responses to Account Payable/Payroll Questions
Rate Comparisons, October 2016
Subsequent Town Meeting
Monday, November 14, 2016
RMLD Board Meetings
No RMLD Board Meeting in November
Thursday, December 15, 2016
RMLD Committee Meetings
Thursday, November 10, 2016 RMLD Board Policy Committee Meeting
CAB Meetings
Wednesday, November 16, 2016
Mr. Pacino volunteered to cover the upcoming CAB meeting.
General Manager Committee Meeting
Chairman O'Rourke asked to schedule online; Ms. Foti agreed, stating she would be in touch via e-mail. Mr. Pacino
asked about town presentation and annual meeting and said that would be a good place to ask for a CAB
volunteer.
Executive Session
At 8:45 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 September 29, 2016, to consider the purchase of real property
and 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:
Mr. Pacino, Aye; Chairman O'Rourke, Aye; Mr. Talbot, Aye; Mr. Stempeck, Aye.
Motion carried 4:0:0.
Adjournment
At 9:40 p.m. Mr. Pacino made a motion seconded by Mr. Stempeck that the RMLD Board of Commissioners move
to adjourn the Regular Session. Mr. Talbot was not present for the vote.
Motion carried 3:0:0.
A true copy of the RMLD Board of Commissioners minutes
as approved by a majority of the Commission.
John Stempeck, Secretary Pro Tem
RMLD Board of Commissioners
Page 1 8
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
REQUIRED SUPPLEMENTARY INFORMATION
7
8
9
10
11
Schedule of OPEB Funding Progress 34
Schedule of Proportionate Share of the Net Pension Liability 35
Schedule of Pension 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 activi-
ties and the aggregate remaining fund information of the Town of Reading Mu 'cipal
Light Department ("the Department") (an enterprise fund of the To iing,
Massachusetts), as of and for the year ended June 30, 201 J es to
the financial statements, which collectively comp ri sic finan-
cial statements as listed in the Table of-CaMents.
Management's R for
'P
r separation an�presenta-
unting principles generally
udes the design, implementation,
levant to the preparation and fair presentation
se from material misstatement, whether due to fraud
itors' Responsibility
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
auditors 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 opin-
ion 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 management, 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, 2016, 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 201 nts,
and we expressed an unmodified audit opinion on t tements
in our report dated October 29, 2015. In r opin ma ' parative
information presented herein as of a e ded J , 2015 is
consistent, in all mate ' cts, it tate om which
it has been deriv
n ' n McWaccepted in the United States of America require that
Ln �scussion and Analysis, Schedule of OPEB Funding Progress,
of Proportionate Share of the Net Pension Liability, and Schedule of Pen-
Rionontributionsions 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.
, 2016
2
MANAGEMENT'S DISCUSSION AND ANALYSIS
Within this section of the Town of Reading Municipal Light Department's ("the Depart-
ment") annual financial report, management provides a narrative discussion and
analysis of the Department's financial activities for the year ended June 30, 2016.
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, (�) the Fiduciary Funds Statements of
Changes in Fiduciary Net Position, and (6) Notes to Financial Statements.
The Proprietary Fund Statements
financial position at a specific point
worth of $104,814,487 which comp
$4,494,953 restricted for deprecia '
The P
of Net Position is desi our
in time. At Ju our net
rises $72,2 t in I assets,
and 17 1 unre
ue s and es in Net
d how much, ' , of a profit
e below, our net profit for the
e nd of Cash Flows provide information about cash
s ent , investing, and financing activities during the accounting
rev; of our Proprietary Fund Statements of Cash Flows indicates that
receipts from operating activities adequately covered our operating expenses
in fiscal year .
The following is a summary of the Department's financial data for the current and
prior fiscal years.
Summary of Net Position
Current assets
Noncurrent assets
Deferred outflows of resources
Total assets and deferred outflows
of resources
Current liabilities
Noncurrent liabilities
Deferred inflows of resources
Total liabilities and deferred inflows
of resources
3
2016
$ 23,903,277
95,390,705
6,338,218
$ 23,184,226
93,572,180
1,547,815
$ 125,632,200 $ 118,304,221
$ 8,244,530 $ 9,330,904
11,690,011 7,528,234
883,172 -
20, 817,713 16,859,138
(continued)
(continued)
Net position:
Net investment in capital assets 72,202,413 69,916,349
Restricted for depreciation fund 4,494,953 5,434,308
Unrestricted 28,117,121 26,094,426
Total net position 104,814,487 101,445,083
Total liabilities and net position $ 125,632,200 $ 118,304,221
Summary of Changes in Net Position
2016 2015
Operating revenues $ 88,735,983 $ 85,005,786
Operating expenses (84,146,744) (80,359,819)
Operating income 4,589,239 4,645,967
Non-operating revenues (expenses) (1,219,835) 14
Change in net position 3,369,4
Beginning net position 1
Ending net position $ 1 487 101,
B. F L
s nts scal year 2016, an increase
5.2 0 p r. cal y r 2016, kilowatt hours sold decreased
1. 8, red to 689,722,742 in fiscal year 2015. In fiscal
c rs received credits of $63,410 in purchase power fuel charge
nts, compared to charges of $1,047,590 in fiscal year 2015.
In fiscal year 2015, the Department restructured its rates and began billing cus-
tomers purchase power capacity and transmission costs separately from the
base rate. In fiscal year 2016, customers were charged purchase power capacity
and transmission adjustments of $445,488.
Operating expenses totaled $84,146,744 in fiscal year 2016, an overall increase
of 4.71 % from fiscal year 2015. The largest portion of this total, $63,700,338, was
for purchase power costs. Other operating expenses included $15,101,267 for
general operating and maintenance costs, $1,400,347 for voluntary payments to
Towns, and depreciation expense of $3,944,792. In fiscal year 2016, the depre-
ciation rate was 3.0%.
In fiscal year 2016, the Department contributed $1,500,000 to the Reading Municipal
Light Department Employees' Retirement Trust ("Pension Trust") and the Pension
Trust contributed $1,464,711 to the Town of Reading Contributory Retirement
System on behalf of the Department's employees.
4
In fiscal year 2016, the Department contributed $308,795 to the Other Post -
Employment Benefits Trust ("OPEB Trust"), which was equal to its actuarially
determined liability at June 30, 2016. As a result, the Department had no unfunded
OPEB liability at June 30, 2016. Additional information on the Department's OPEB
contributions can be found in Note 17 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 depreciable capital
assets at year-end amounted to $70,936,570 (net of accumulated depreciation),
an increase of $2,286,063 from the prior year. This investment in depreciable
capital assets includes structures and improvements, equipment and furnishings,
and infrastructure assets.
Debt and other long-term liabilities. At the 4
Department had no outstanding bonded debt.
Additional information on capital as and
found in the Notes to Financial S.
the
i be
Wm 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
5
TOWN OF READING, MASSACHUSETTS
MUNICIPAL LIGHT DEPARTMENT
BUSINESS -TYPE PROPRIETARY FUND
STATEMENTS OF NET POSITION
JUNE 30, 2016 AND 2015
2016
ASSETS
Current:
Unrestricted cash and short-term investments $ 13,123,605
Receivables, net of allowance for uncollectable 8,203,587
Prepaid expenses 985,756
Inventory 1,590,329
Total current assets 23,903,277
Noncurrent:
Restricted cash and short-term investments 21,815,636
Restricted investments 1,345,663
Investment in associated companies 26,994
1 -j 4 iQa QA')
$ 13,151,862
7,314,059
1,137,898
1,580,407
23,184,226
22,344,776
uue to urtei 1 rust
Current portion of long-term liabilities:
Accrued employee compensated absences
Total current liabilities
Noncurrent
Accrued employee compensated absences
Net pension liability
Total noncurrent liabilities
DEFERRED INFLOWS OF RESOURCES
TOTAL LIABILITIES AND DEFERRED INFLOWS
OF RESOURCES
NET POSITION
Net investment in capital assets
Restricted for depreciation fund
Unrestricted
TOTAL NET POSITION
401,347
8,244,530
2,856,462
8,833,549
11,690,011
883,172
20,817,713
72,202,413
4,494,953
28,117,121
$ 104,814,487
The accompanying notes are an integral part of these financial statements.
A
5,097,838
585,104
846,361
889,774
1,500,000
345,382
66,445
9,330,904
3,004,043
4,524,191
7,528,234
16,859,138
69,916,349
5,434, 308
26,094,426
$ 101,445,083
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, 2016 AND 2015
Operating Revenues:
Electric sales, net of discounts of $3,294,567
and $2,953,502 respectively
Purchase power adjustments:
Fuel charge adjustment
Capacity and transmission adjustment
Total Operating Revenues
Operatlng (Expenses:
Purchase power
Operating
Maintenance dd
MMWEC surplus
intergovemmental grants
Contributions in aid of construction
Return on investment to Town of Reading
Loss on disposal of capital assets
Other
Total Nonoperating Revenues (Expenses), Net
Change in Net Position
Net Position at Beginning of Year
Net Position at End of Year
2016
$ 88,353,905
(63,410)
445,488
88,735,983-
209,514
250,690
125,000
285,921
(2,370,445)
(85,561)
365.046
(1,219,835)
3,369,404
101,445,083
$ 104,814,487
The accompanying notes are an integral part of these financial statements.
7
2015
$ 83,985,195
1,047,590
,073,227
,606,195
X1,395,728
3,861,465
80,359,819
4,645,967
122,693
212,689
62,500
64,474
(2,332,863)
(58,296)
524.112
0,404,691)
3,241,276
98,203,807
$ 101,445,083
TOWN OF READING, MASSACHUSETTS
556,991
152,142
MUNICIPAL LIGHT DEPARTMENT
(9,922)
(172,907)
BUSINESS -TYPE PROPRIETARY FUND
-
438,515
STATEMENTS OF CASH FLOWS
(1,500,000)
125,462
FOR THE YEARS ENDED JUNE 30, 2016 AND
2015
4,309,358
(519,874)
2016
2015
Cash Fbws From OoemUna Activities:
Receipts from customers and users $
87,519,922
$ 84,638,647
Payments to vendors and employees
(81,064,473)
(76,424,486)
Customer purchase power adjustments
382,077
1,020,591
Net Cash Provided By (Used For) Operating Activities
6,837,526
9,234,752
Cash Flows From Noncaoital Financina Activities:
Return on investment to Town of Reading
(2,370,445)
(2,332,863)
MMWEC surplus
250,690
212,689
Other
365,047
524,112
Net Cash Provided By (Used For) Noncapital Financing Activities
(1,754,708
6,062)
Cash Flows From Cmbl and Roland Financing Activ&s:
Acquisition and construction of capital assets
)
(3,642,005)
Contributions in aid of construction
403,289
553,592
Intergovernmental revenues
25,000
62,500
Net Cash Provided By nd Re A
(5,788,127)
(3,025,913)
e
209,514
122,693
nd'
467,538
(3,118,820)
h P By or)
677,052
(2,994,127)
t Un Cas nd Short -Term Investments
(28,257)
1,618,650
and 'Short -Term Investments, Beginning of Year
Cash and Short -Term Investments, End of Year
Reconciliation of Oceratina Income to Net Cash:
Operating income
Adjustments to reconcile operating income to net cash
provided by (used for) operating activities:
Depreciation expense
(Increase) decrease in:
Accounts receivable
Prepaid and other assets
Inventory
Deferred outflows of resources
Accounts payable and accrued liabilities
Due to pension trust
Due to other postemployment benefits trust
Net pension liability
Deferred inflows of resources
Other
Net Cash Provided By (Used For) Operating Activities
The accompanying notes are an integral part of these financial statements.
E
13,151, 862 11, 533, 212
$ 13,123,605 $ 13,151, 862
$ 4,589,239 $ 4,645,967
3,944,792 3,861,465
(889,528)
556,991
152,142
(365,132)
(9,922)
(172,907)
(4,790,403)
-
438,515
834,214
(1,500,000)
125,462
(345,382)
345,382
4,309,358
(519,874)
883,172
-
55,543
(76,816)
$ 6,837,526
$ 9,234,752
TOWN OF READING, MASSACHUSETTS
MUNICIPAL LIGHT DEPARTMENT
FIDUCIARY FUNDS
STATEMENTS OF FIDUCIARY NET POSITION
JUNE 30, 2016 AND 2015
Pension Trust
ASSETS 2016015
Cash and short-term investments $ 4,264,442 $ 2,666,772
Investments 1,345,663 1,284,061
Due from proprietary fund _ 1
TOTAL ASSETS 5_sin.AN9199 sA
$
The accompanying notes are an integral part of these financial statements.
9
OPEB Trust
16 2015
$ 2,525,843 $ 1,857,738
5,382.00
-!.2!,525,j!2,203,12 0
$ 2,525,843 s $ 2,203,120
TOWN OF READING, MASSACHUSETTS
MUNICIPAL LIGHT DEPARTMENT
FIDUCIARY FUNDS
STATEMENTS OF CHANGES IN FIDUCIARY NET POSITION
FOR THE YEARS ENDED JUNE 30, 2016 AND 2015
The accompanying notes are an integral part of these financial statements.
10
Pension Trust
OPEB Trust
2016
2015
2016
2015
Additions:
Contributions from Reading
Municipal Light Department
$ 1,500,000
$ 1,500,000
$ 308,795
$ ,382
Investment income and
change in fair value
123,983
52,660
696
Total additions
1,623,983
1,552,
3
357,078
Deductions:
Paid to Reading C
ys
464
16
-
-
1
-
-
ase
1
151,022
322,723
357,078
Beginning of Year
5,450,833
5,299,811
2,203,120
1,846,042
Net Position, End of Year
$ 5,610,105
$ 5,450,833
$ 2,525,843
$ 2,203,120
The accompanying notes are an integral part of these financial statements.
10
1.
Town of Reading, Massachusetts Municipal Light Department
Notes to Financial Statements
Summary of Sianificant Accounting Policies
The significant accounting 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. Regulation and Basis of Accounting - Under M
Laws, the Department's electric rates are set
Electric rates, excluding the purchase po
power capacity and transm' charg
once every three months. &Atli&
Departme 'c Util ).
�
eral
ard.
purchase
rare than
W
h theachusetts
U ex s general
)epartmen s are not
y is to pre re its financial
accounting principles.
n operating revenues and expenses from non -
at 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 deregula-
tion legislation that restructured the Commonwealth's electricity industry to
foster competition and promote reduced electric rates. Energy deregula-
tion created a separation between the supply and delivery portions of elec-
tricity 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 established
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 -Employment 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 actuarially
determined OPEB contribution for future retirees.
F. Revenues - Revenues are based on rates es ent
and filed with the DPU. Revenues from rOe on
the basis of bills rendered nthly !a ings n a cycle
basis and ares ed net o ts. giv a amount
of sale whi . led of the eriod.
40frefnv�m1Illllllllll1l0r rposes of the Statements of
tricted cash on deposit with
h or rt -term investments. For purposes of
n on, both the proprietary funds and fiduciary.
e
er u restricted and restricted investments with original maturi-
monthsor 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-
poses and is stated at average cost. Meters and transformers are capi-
talized when purchased.
12
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 of the
retired asset, less accumulated depreciation, salvage value and any cash
proceeds, is charged to the Department's unrestricted net position.
Massachusetts General Laws require utility plant in serv' reci-
ated at a minimum annual rate of 3%. To chan ent
must obtain approval from the DPU. Ch tion rates
may be made for financial fatgMelatin s for xpansion,
rather than enaineerina� fa inn t f Qe
E vacation IOW is vested
ua ly the succeeding year with
an the terms of the applicable
con enerally, sick leave may accumu-
a 9 Department contracts and policy, and is paid
n to enation at the current rate of pay. The Department's policy
to re ognize vacation costs at the time payments are made. The Depart-
ment 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 esti-
mates that were used.
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
13
FA
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 contributions in
aid of construction multiplied by eight percent. From this calculation, the
Municipal Light Board will determine what cash transfers need to be made
at the end of the fiscal year.
Cash and Investments
Total cash and investments a 30,
panying finan ' nts
Cash and short -tern investments - Pension Trust
Cash and short-term investments - OPEB Trust
Investments - Pension Trust
Total cash and investments
accom-
$ 13,123,605
21,815,636
1,345,663
4,264,442
2,525,843
1,345,663
$ 4414201852
Total cash and investments at June 30, 2016 consist of the following:
Cash on hand
Deposits with financial institutions
Total cash and investments
14
$ 3,000
44,417,852
$ 441420,852
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 pro-
vide the cash flow and liquidity needed for operations.
As of June 30, 2016, the Department (including the Pension Trust and OPEB
Trust) held cash and short-term investments in pooled investments with the
Massachusetts Municipal Depository Trust (MMDT), FDIC -insured savings
accounts, and 90 -day FDIC -insured bank certificates of deposit. Because of
their immediate liquidity and/or short-term maturity, these funds are cl ified
as cash and short-term investments in the accompanying fin nts
and are not considered to be exposed to significap jp
As of June 30, 2016, the De andT st held tments in
domestic and forei n ed inco withcity d follows:
Fiduciary 1W
Funds
Pension Maturity
Trust Date
PI&T Ine
$ 221,559
$ 221,559
12/01/22
General Electric Cap Corp
220,472
220,472
01/09/23
Wells Fargo & Co
214,864
214,864
08/15/23
Rabobank Nederland Bank
257,210
257,210
11/09/22
Teva Pharmaceut Fin BV
218,036
218,036
12/18/22
BNP Paribas
213,522
213,522
03/03/23
Total
$ 1,345,663
$ 1,345,663
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 assigning of
a rating by a nationally recognized statistical rating organization. As of June 30,
2016, the Department and Pension Trust held investments in domestic and
foreign fixed income bonds with varying ratings as follows:
15
Concentration of Credit Risk
The Department follows the Town of Reading's
not limit the amount that can be invested in
lated by Massachusetts Gener . At J
Pension Trust inv nts w in d
bonds, as se e. F
mmsent 16 a
does
I at stipu-
, the nt and
foreid income
; and Syster@Pltal invest-
nd Bank represents approx-
Pa dial Ur -edit Risk for deposits is the risk that, in the event of the failure of
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, 2016, none of the Department's (including Pension Trust and
OPEB Trust) cash and short-term investments was exposed to custodial credit
risk.
16
Proprietary
Fiduciary
Fund
Funds
Restricted
Pension
Moody's
Investment Tyne
Investments
Trust
Rating
Corporate bonds:
AT&T Inc
$ 221,559
$ 221,559
BAA1
General Electric Cap Corp
220,472
220,472
Al
Wells Fargo & Co
214,864
214,864
A3
Rabobank Nederland Bank
257,210
257,210
A3
Teva Pharmaceut Fin BV
218,036
218,036
BAA1
BNP Paribas
213,522
213,522
Al
Total
$ 11345,663
$ 1,3451663
Concentration of Credit Risk
The Department follows the Town of Reading's
not limit the amount that can be invested in
lated by Massachusetts Gener . At J
Pension Trust inv nts w in d
bonds, as se e. F
mmsent 16 a
does
I at stipu-
, the nt and
foreid income
; and Syster@Pltal invest-
nd Bank represents approx-
Pa dial Ur -edit Risk for deposits is the risk that, in the event of the failure of
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, 2016, none of the Department's (including Pension Trust and
OPEB Trust) cash and short-term investments was exposed to custodial credit
risk.
16
As of June 30, 2016, none of the Department or Pension Trust investments
were exposed to custodial credit risk because the related securities are regis-
tered 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
6/30/16
Cash Investments
6/30/15
Cash tnvestments
all 0 -
,200,0
1,777, 1,284,061
150, -
846, -
$ 22,344,776 $ 112841061
$ 4,494,953 $ - $ 5,434,308 $
1,500,000 - 1,400,000
5,116,875 - 5,180,285
following reserves:
Depreciation fund - The Department is normally required to reserve
3.0% of capital assets each year to fund 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 energy 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
4.
- Hazardous waste fund -This reserve was set up by the Board of Com-
missioners to cover the Department's insurance deductible in the event
of a major hazardous materials incident.
- Customer deaosits - Customer deposits that are held in escrow.
Accounts Receivable
Accounts receivable consists of the following at June 30, 2016:
Customer Accounts:
Billed $ 2,085,964
Less allowances:
Uncollectible accounts (200,000)
Sales discounts (83,691)
A
Total billed
Unbilled, net
Total customer
5.
6.
Total net receivables
Prepaid Expenses
Prepaid expenses consist of the following:
Insurance and other
Purchase power
NYPA prepayment fund
WC Fuel - Watson
Total
Inventory
r,253
38,416
715,204
$ 8,2031587
$ 345,837
72,930
307,573
259.416
$ 985,756
�s
Inventory comprises supplies and materials at June 30, 2016, and is valued
using the average cost method.
18
7.
8.
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 require-
ments for the Hydro -Quebec Phase If interconnection. The Department is carry-
ing 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, 2016:
New England Hydro -Transmission (NEH 8 NHH) $ 26,994
Capital Assets
The following is a summary of fiscal year 2016 activity in
thousands): _.MM
l4uipment and furnishings
Infrastructure
Total accumulated depreciation
Total capital assets, being depreciated, net
Capital assets, not being depreciated:
Land
Total capital assets, not being depreciated
Capital assets, net
9. Deferred Outflows of Resources
ow' Ending
a Balance
1 $ 1,600 $ $ 16,146
3 915 (129) 32,511
8 3,801 970 88,053
131,493 6,316 (1,099) 136,710
(8,525) (424) - (8,949)
(20,090) (895) 129 (20,856)
(34,228) (2,625) 884 (35,969)
(62,843) 3,944 1,013 65,774
68,650 2,372 (86) 70,936
1,266 - - 1,266
1,266 - - 1,266
616 Q a2,372 $ a 72,202
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, 2016:
Proprietary
Fund
Pension related:
Net difference between projected and actual
investment earnings on pension plan $ 1,905,088
Pension plan changes in assumptions 2,933,130
Pension plan contributions subsequent to the
measurement date 1,500,000
Total $ 6,3381218
10. Accounts Payable
Accounts payable represent fiscal 2016 expenses that
2016. -19990
12. Customer Deposits
13.
14.
202,793
212,176
34,435
$ 449,404
30,
This balance represents deposits received from customers that are held in
escrow.
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.
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.
ME
15. Deferred inflows of Resources
Deferred inflows of resources are the acquisition of net assets by the
Department that are applicable to future reporting periods. Deferred inflows of
resources have a negative effect on net position, similar to liabilities.
The following is a summary of deferred inflow of resources balances as of
June 30, 2016:
Proprietary
Fund
Pension related:
Differences between expected and actual
experience $ 883,172
Total $ 883,172
Restricted Net Position
The proprietary fund financial
external constraints are plao
position re eciath
ion when
icted net
for future
11101% 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 actuarially required
contribution as an expense on the proprietary fund Statements of Revenues,
Expenses, and Changes in Net Position when a future retiree earns their
post -employment benefits, rather than when they use them. To the extent that
an entity does not fund their actuarially required contribution, a post -employment
benefit liability is recognized on the proprietary fund Statements of Net Position
over time.
A. Plan Description
In addition to providing the pension benefits described in Note 18, the
Department provides post -employment health and life insurance benefits
to retired employees through the Town of Reading's participation in the
Massachusetts Interlocal Insurance Association (MITA) Health Benefits
Trust. Benefits, benefit levels, employee contributions and employer contri-
21
butions are governed by Chapter 32 of the Massachusetts General Laws.
As of June 30, 2014, the actuarial valuation measurement date, approxi-
mately 87 retirees and 51 active employees meet the eligibility require-
ments. The plan does not issue a separate financial report.
B. Benerits 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 retire from the Department and meet the appro-
priate criteria are eligible to receive these benefits.
C. Fundina Policy
FBI
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. also
contribute 50% of the premium for a jjoq
The
Department contributes the remainder on drug,
and fife insurance plan costs on�pay-a
D I O xpense is caIllillMed based
red f mployer (ARC), an amount
i parameters of GASB State -
sen a level of funding that, if paid on an
iii n is, to cover the normal cost per year and amortize
un 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, 2016, the amount actually con-
tributed to the plan, and the change in the Department's net OPEB obliga-
tion based on an actuarial valuation as of June 30, 2014.
Annual Required Contribution (ARC)
$ 553,967
Interest on net OPEB obligation
228,972
Annual OPEB cost
782,939
Projected benefit payments
474144
Increase in net OPEB obligation
308,795
Net OPEB obligation - beginning of year
-
Contributions to OPEB Trust
(308,795)
Net OPEB obligation - end of year
$ -
(f) See Part E for additional inforrnatian
22
The Department's annual OPEB cost, the percentage of annual OPEB
cost contributed to the plan, and the net OPEB obligation for fiscal year
2016 and the two preceding fiscal years were as follows:
Annual Percentage of
OPEB OPEB Net OPEB
Fiscal Year Ended Cost Cost Contributed Obligation
2016
$ 782,939
100.00% $
2015
$ 758,525
100.00% $
2014
$ 768,378
100.00% $
2013
$ 604,987
100.00% $
E. Funded Status and Fundlnc Procress
The funded status of the plan as of June 30, 2014, the most
anal valuation measurement date was as follows: _.Now
Actuarial accrued liability (AAL)667
Actuarial value of plan as X042
Unfun a (U $ ,625
ou" � N/A
a cover payroll N/A
P.F20160,ffe- Department's Municipal Light Board voted to accept the provi-
sions of Chapter 32B §20 of Massachusetts General Laws and create an
Other Post -Employment Benerds Liability Trust Fund as a mechanism to
set aside monies to fund its OPEB liability. In 2013, the Commissioners voted
to create an OPEB trust instrument in alignment with the Town of Reading.
In fiscal year 2016, the Department contributed $308,795 to this trust, which
was equal to all of its actuarially determined annual contributions through
June 30, 2016. The assets and net position of this trust are reported in the
Department's Fiduciary Funds Statements of Fiduciary Net Position.
Actuarial valuations of an ongoing plan involve estimates of the value of
reported amounts and assumptions about the probability of events far into
the future. Examples include assumptions about future employment, mor-
tality, and the healthcare cost trend. Amounts determined regarding the
funded 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
23
trend information about whether the actuarial value of plan assets is increas-
ing 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.
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 7.7 ent
rate of return and an initial annual health care cos ich
decreases by 0.5% for six years to an u ' year. The
amortization costs for the i j�UAAAL percen of payroll
amortization, with amortiza� n at 2.5 year for a
remainin 6 ye
ivisions of GASB Statement No. 68, Accounting
Pensions — An Amendment of GASB Statement
to the employees' retirement funds.
A. Plan Description
Substantially all employees of the Department are members of the Town
of Reading Contributory Retirement System (the System), a cost sharing,
multiple -employer public employee retirement system (PERS). Eligible
employees must participate in the System. The pension plan provides
pension benefits, deferred allowances, and death and disability benefits.
Chapter 32 of the Massachusetts General Laws establishes the authority
of the System, as well as contribution percentages and benefits paid. The
System Retirement Board does not have the authority to amend benefit
provisions. Additional information is disclosed in the System's annual
financial reports, which are publically available from the System's admin-
istrative offices located at Reading Town Hall, 16 Lowell Street, Reading,
Massachusetts, 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
24
compensation. Benefit payments are based upon a member's age, length
of creditable service, level of compensation and group classification. Mem-
bers become vested after 10 years of creditable service. A retirement allow-
ance may be received upon reaching age 65 or upon attaining 20 years of
service. The plan also provides for early retirement at age 55 if the par-
ticipant (1) has a record of 10 years of creditable service, (2) was on
the Department payroll on January 1, 1978, (3) voluntarily left Department
employment on or after that date, and (4) left accumulated annuity deduc-
tions 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 1,A approximately 80-85% pension and 15-20% annuity.
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 p ding
retirement, the difference in the annual rate of regular corn even
any 2 consecutive years exceeds 100 percerE unt
of the retirement allowance shall be b al rate of
regular compensation race' the the of 5 con-
secutive years pt�eding .
•"+'"'and= are not WOW receive a
or 55 are entitled to request a
d mu n addition, depending upon
o itaable , such employees are entitled to
ndred percent of the regular interest which has
n tit se deductions. However, effective July 1, 2010, mem-
rs v untarily withdrawing with less than 10 years of service get credited
interest each year at a rate of 3% and do not forfeit any interest previously
earned on contributions.
Participants contribute a set percentage of their gross regular compensation
annually. Employee contribution percentages are specified in Chapter 32 of
the Massachusetts General Laws. The employee's individual contribution
percentage is determined by their date of entry into the system. In addi-
tion, all employees hired after January 1, 1979 contribute an additional 2%
on all gross regular compensation over the rate of $30,000 per year. The
percentages are as follows:
Before January 1, 1975 5%
January 1, 1975 - December 31, 1983 70,E
January 1, 1984 - June 30, 1996 8%
Beginning July 1, 1996 9%
25
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,
2016 was $1,464,711, which was equal to its annual required contribution.
D. Summary of Significant Accounting Policies
E.
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 contributions)
are recognized when due and payable in accordance with benefit terms.
Investments are reported at fair value.
At June 30 a De a of $8 9 for its
propo f th net n liability. t pension
a r 015, and thal pension
ula ility was determined by an
s rolled forward to December 31,
ePWopor6n of the net pension liability was based
n a ned projection of the Department's long-term share
coI ons to the pension plan relative to the projected contributions
f all participating employers. At December 31, 2015, the Department's pro-
portion was 28.25%.
Town of Reading Municipal Light Department Employees' Retirement Trust
j"Pension Trust': The Department has established an irrevocable trust for
the purpose of currently funding its annual required contribution to the
Town of Reading Contributory Retirement System (RCRS). Annual contri-
butions to the trust are actuarially determined to be the net normal cost for
funding the Department's liability for pension benefits for covered employ-
ees, and both the principal and income of the trust is restricted for the
exclusive benefit of Department employees and their beneficiaries. This
Pension Trust is reported as a fiduciary fund type in the Department's
basic financial statements.
As noted in the first paragraph of this section, the Department's propor-
tionate share of the RCRS net pension liability was determined by an
actuarial valuation as of January 1, 2015 rolled forward to December 31,
2015. However, the actuarial valuation does not take into account the
fiduciary net position of the Department's Pension Trust at December 31,
26
2015 (the measurement date). Accordingly, the following reconciliation is
provided:
Net pension liability, per actuarial valuation
Pension Trust Net Position
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)
Pension Trust investment income and fair value
changes subsequent to the net pension liability
measurement date
Net pension liability, as reported on the proprietary
fund Statements of Net Position
For the year ended June 30, 2016, the
I
11 vaounvnL naining5 on pension plan
Contributions subsequent to the measurement
date
Total
2016
$ 12,862,732
(5,610,105)
$
1,500,000
80,922
pension
Ted out
Deferred FWeferred
E)U"M of Inflows of
Resources Resources
$ - $ 883,172
2,933,130 -
1,905,088
1,500,000 -
$ 6,338,218 $i 88_ 3_172
Deferred outflows of resources related to pensions resulting from contri-
butions subsequent to the measurement date will be recognized as a reduc-
tion of the Department's net pension liability in the year ending June 30,
2017.
27
Amounts reported as deferred outflows of resources related to pensions
will be recognized in the Department's pension expense as follows:
Year ended June 30:
2017
$ 2,421,062
2018
921,062
2019
921,061
2020
909,108
2021
282,753
Total $ 5,455,046
Actuarial assumptions: The total pension liability was determined by an
actuarial 'valuation as of January 1, 2015, rolled forward to the measure-
ment date of December 31, 2015 using the following actuarial as ump-
tions, applied to all periods included in the measurement:
Inflation 3.75% per
Salary increases 6 5% for ral ployee % -
M Publ' ndi ars of
plan investrrit expense,
a pr�ment rates that reflect the RP -2014
V, fully generational mortality improvement using
fley4. ost retirment rates reflect the RP -2014 Table, projected
erational mortality improvement using Scale MP -2014. For
disabled lives, the RP -2014 Disabled Mortally Table was used.
The long-term 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 esti-
mates of arithmetic real rates of return for each major asset class included
in the pension plan's target asset allocation as of December 31, 2015 are
summarized in the following table:
28
Discount Rate: The discount rate used to measure
ity was 7.65%. The projection of cash fl
count rate assumed that plan mber
current contribution rate a ntrib
Miabil-
the dis-
at the
will be mad rda Cho 22Fowo
ter 32 of
the M ener s ose assumthe gen-
et r to be availmake all
Y mbers. Therefore, the long-
e f n investments was applied to all
ayments to determine the total pension liability.
To Gnomes in the discount rate: The following table presents the Depart-
ment's proportionate share of the net pension liability (asset) calculated
using the current discount rate of 7.65%, as well as what the Department's
proportionate share of the net pension liability (asset) would be if it were
calculated using a discount rate that is 1 percentage -point lower (6.65%)
or 1 percentage -point higher (8.65%) than the current rate:
1%
Decrease
Fiscal Year Ended (6.6596)
June 30, 2016 S 14,076,273
Current
Discount 1%
Rate Increase
(7.6596) (8.6596)
S 8,833,549 $ 4,367,178
Pension Plan fiduciary net Position: Detailed information about the pension
plan's fiduciary net position is available in the separately issued System
financial report.
29
Long-term
Target
Expected
Asset
Rates
Asset Class
Allocation
of Return
Global equity
40.00%
8.02%
Fixed income
13.00%
3.72%
Value -Added Fixed Income
10.00%
6.86%
Private equity
10.00°x6
9.50%
Real estate
10.00%
6.50%
Timber/Natural Resources
4.00%
7.07%
Hedge funds
9.00%
6.50%
Other
4.00%
6.18%
Total
100.00%
Discount Rate: The discount rate used to measure
ity was 7.65%. The projection of cash fl
count rate assumed that plan mber
current contribution rate a ntrib
Miabil-
the dis-
at the
will be mad rda Cho 22Fowo
ter 32 of
the M ener s ose assumthe gen-
et r to be availmake all
Y mbers. Therefore, the long-
e f n investments was applied to all
ayments to determine the total pension liability.
To Gnomes in the discount rate: The following table presents the Depart-
ment's proportionate share of the net pension liability (asset) calculated
using the current discount rate of 7.65%, as well as what the Department's
proportionate share of the net pension liability (asset) would be if it were
calculated using a discount rate that is 1 percentage -point lower (6.65%)
or 1 percentage -point higher (8.65%) than the current rate:
1%
Decrease
Fiscal Year Ended (6.6596)
June 30, 2016 S 14,076,273
Current
Discount 1%
Rate Increase
(7.6596) (8.6596)
S 8,833,549 $ 4,367,178
Pension Plan fiduciary net Position: Detailed information about the pension
plan's fiduciary net position is available in the separately issued System
financial report.
29
19. Participation in Massachusetts Municipal Wholesale Electric
Company
The Town of Reading, acting through its Light Department, is a Participant in
certain Projects of the Massachusetts Municipal Wholesale Electric Company
(MMWEC).
MMWEC is a public corporation and a political subdivision of the Common-
wealth of Massachusetts, created as a means to develop a bulk power supply
for its Members and other utilities. MMWEC is authorized to construct, own,
or purchase ownership interests in, and to issue revenue bonds to finance,
electric facilities (Projects). MMWEC has acquired ownership interests in
electric facilities operated by other entities and also owns and operates its
own electric facilities. MMWEC sells all of the capability (Project Capability)
of each of its Projects to its Members and other utilities (Project Participants)
under Power Sales Agreements (PSAs). Among other things, the PS uire
each Project Participant to pay its pro rata share of MM lated
to the Project, which costs include debt service o sued
by MMWEC to finance the Project, plus 10° ice to be
paid into a Reserve and Cony Fu ad i in, s a Project
ithatProje
nt fail to m e any khhen roject cipants of
ired it pay nd corre-
nt' s Project ility to an
I o e inal Participant's share of
apnts have covenanted to fix,
a t suffo meet their obligations under the
C f5as issued separate issues of revenue bonds for each of its eight
rojects, which are payable solely from, and secured solely by, the revenues
derived from the Project to which the bonds relate, plus available funds
pledged under MMWEC's Amended and Restated General Bond Resolution
(GBR) with respect to the bonds of that Project. 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 3.7% interest
in the W.F. Wyman Unit No.4 plant, which is operated and owned by its
majority owner, FPL Energy Wyman IV, LLC, a subsidiary of NextEra Energy
Resources LLC, and a 4.8% ownership interest in the Millstone Unit 3 nuclear
unit, operated by Dominion Nuclear Connecticut, Inc. (DNCI), the majority
owner and an indirect subsidiary of Dominion Resources, Inc. DNCI also
owns and operates the Millstone Unit 2 nuclear unit. The operating license for
the Millstone Unit 3 nuclear unit extends to November 25, 2045.
30
MMWEC A substantial portion of MMWEC's plant investment and financing
program is an 11.6% ownership interest in the Seabrook Station nuclear gen-
erating unit operated by NextEra Energy Seabrook, LLC (NextEra Seabrook)
the majority owner and an indirect subsidiary of NextEra Energy Resources
LLC. The operating license for Seabrook Station extends to March 15, 2030.
NextEra Seabrook has submitted an application to extend the Seabrook Station
operating license for an additional 20 years.
Pursuant 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 costs are being funded through monthly
Project billings. Also, the Project Participants are liable for their proportionate
share of the uninsured costs of a nuclear incident that might be imposed
under the Price-Anderson Act (Act). Originally enacted in 1957, the Act has
been renewed several times. In July 2005, as part of the Energy Policy Act of
2005, Congress extended the Act until the end of 2025.
The Reading Municipal Light Department has enter ower
Purchase Agreements (PPAs) with MMWEC nd PPAs,
the Department is required to rtai to M payable
solely from Department revenu er th Pa ' is uncon-
ditionally obliake due whe r not the
Pro'ect(s) r o d n standing the nsion or
to a of
M va a n the opinion of management,
th s r claims will not have a material adverse effect
o n pos a company.
the July 1, 2016 principal payment, total capital expenditures amounted
to $1,694,153,000, of which $126,048,000 represents the amount associated
with the Department's Project Capability. MMWEC's debt outstanding for the
Projects from Power Supply System Revenue Bonds totals $112,510,000, of
which $4,099,000 is associated with the Department's share of Project Capabil-
ity. After the July 1, 2016 principal payment, MMWEC's total future debt service
requirement on outstanding bonds issued for the Projects is $59,282,000, of
which $1,664,000 is anticipated to be billed to the Department in the future.
The aggregate amount of the Department's required payments under the
PSAs and PPAs, exclusive of the Reserve and Contingency Fund billings, to
MMWEC at June 30, 2016 and estimated for future years is shown below.
Annual Costs
For years ending June 30, 2017 $ 1,473,000
2018 191,000
Total $ 1,6641000
31
20.
In addition, under the PSAs, the Department is required to pay to MMWEC its
share of the Operation and Maintenance (0& M) costs of the Projects in which
it participates. The Department's total 0& M costs including debt service under
the PSAs were $11,894,000 and $12,475,000 for the years ended June 30,
2016 and 2015, respectively.
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.
Energy suppliers meet their annual RPS obligations by acquirin tient
quantity of RPS -qualified renewable energy certificates ated
and recorded at the New England Power P on Infor-
mation System (GIS). Suppliers purc from 'ty gen-
erators or from other utilities th acqui
As part oG rgy, the ent has
in ( with Swift R ydro LLC
rpo r generated from renewable
e e rtment taking title to RECs,
a produced was the product of a renewable
re se artment is exempt from the RPS provisions, it has
'on Iding these RECs until they expire or selling them through the
OOL GIS.
Information regarding the Department's fiscal year 2016 REC activity and bal-
ances is as follows:
REC Sales During
Fiscal 2016
Unit
Certificates
Price
Amount
CT Class 1
6,008
$
24.00
$ 144,192
MA Class 1
394
$
24.00
9,456
MA Class II
426
$
24.00
10,224
MA Class II
787
$
24.75
19,478
RI Class 1
189
$
44.00
8,316
MA Class 1
4,029
$
46.50
187,349
CT Class 1
6,807
$
46.50
316,526
Total
18,640
$ 695,541 (1)
(1) Sale proceeds netted against fiscal Year 2016 purchased power fust charge
32
21.
REC Holdings at June 0. 2016
Banked
Certfficates
MA Class I & II -
CT Class I -
RI Class I -
Total -
Projected Total Estimated
Certificates. C tes Value
7,214
7,214
$ 180,350
3,957
3,957
98,925
384
384
9,600
r
_ 111555
11,555
$ 288,875
A banked REC is a REC that has been processed by the NEPOOL GIS Coor-
dinator and is in the Department's GIS account. A projected REC is the
Department's estimate of what will be received based on invoices generated
by REC-producing projects that the Department has entitlements to.
Because there is no formal accounting guidance under GAAP or IFRS for
RECs and the Department does not have a formal policy for the fu isp-
osition of RECs, the estimated fair value of the Departm ings
at June 30, 2016 are not recognized as an a fund
Statements of Net Position.
pig
re to M Mat are currently sub -leased to
th di w Federal Credit Union. The original sub -lease
a n me n December 2000 and was extended by various
me rough November 30, 2016. Following is the future minimum
I income to be received by the Department under the terms of this lease
for the year ending June 30:
2017 $ 4,084
Total $ 4,084
Operatina Lease - Warehouse
The Department is the lessee of a warehouse facility owned by JCM Real
Estate Trust. The original lease agreement for this facility commenced in
December 1998 and was extended by various amendments through May 31,
2016. Under the terms of the most recent lease amendment, the Department
has exercised the option to extend the lease for an additional 24 months until
May 31, 2018. Following is the future minimum rental expense to be paid by
the Department for the year ending June 30:
2017
$ 161,348
2018
147,902
Total
$ 309,250
33
TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT
SCHEDULE OF OPEB FUNDING PROGRESS
Actuarial
Valuation
Date
REQUIRED SUPPLEMENTARY INFORMATION
Actuarial
Value of
Assets
u
June 30, 2016
(Unaudited)
Other Post -Employment Benefits
Actuarial
Accrued
Liability
(AAL) -
Entry Age
u
Auditors' Report.
Unfunded
AAL
(UAAL)
Ll.
34
Funded
UAAL as
a Percent-
age of
TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT
SCHEDULE OF PROPORTIONATE SHARE
OF THE NET PENSION LIABILITY
REQUIRED SUPPLEMENTARY INFORMATION
JUNE 30, 2016
(Unaudited)
Reading Contributory Retirement System
Proportionate Share of the Plan Fiduciary Net Position
Net Pension Liability as a Peroen s of the Total
Covered Payroll Peroenbm of Covered Pavror fusion Liability
$ 8,439,178 137.18%
$ 508,893 76.57%
Mfarmatlon above Is presented as of the most recent measurement date.
Sdrooidw we k*wxfed
See Independent Audito
72.17%
79.89%
35
Proportion
Proportionate
of the
Share of the
Fiscal
Net Pension
Net Pension
1L
LAY
LM&
June 30, 2016
28.25%
$8,833,549
June 30, 2015
28.25%
$4,524,191
Proportionate Share of the Plan Fiduciary Net Position
Net Pension Liability as a Peroen s of the Total
Covered Payroll Peroenbm of Covered Pavror fusion Liability
$ 8,439,178 137.18%
$ 508,893 76.57%
Mfarmatlon above Is presented as of the most recent measurement date.
Sdrooidw we k*wxfed
See Independent Audito
72.17%
79.89%
35
TOWN OF READING, MASSACHUSETTS, MUNICIPAL LIGHT DEPARTMENT
SCHEDULE OF PENSION CONTRIBUTIONS
REQUIRED SUPPLEMENTARY INFORMATION
JUNE 30, 2016
(Unaudited)
Independent Auditors' Report.
far 10 years. Adducin al years will be dspkW as they
36
Reading Contributory Retirement System
i
Contributions in
Relation to the
Contractually
Contractually Contribu;kAr
ons as
Fiscal
Required
Required Deficieage
of
YAC
i a i n
Contribution (Exces
Pa roll
June 30, 2016
$ 1,464,711
$ 1,464,711 $
%
June 30, 2015
$ 1,401,638
$ 1,401,
°
Independent Auditors' Report.
far 10 years. Adducin al years will be dspkW as they
36
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To: Coleen O'Brien
From: aureen McHugh, Jane Parentea
Date: October 12, 2016
Subject: Purchase Power Summary — August, 2016
Energy Services Division (ESD) has completed the Purchase Power Summary for the
month of August, 2016.
ENERGY
The RMLD's total metered load for the month was 73,696,262 kWh, which is a 1.97%
increase from the August, 2015 figures.
Table 1 is a breakdown by source of the energy purchases.
Table 1
Millstone #3
3,649,666 '
$6.76
4934A 9
$24,661
0.77%
Seabrook
5,882 459
$6.32;
794%,
$37,177
1.16%
Stonybrook Intermediate
6,961 625 t
$35.16
940%
$244,738
7.66%
Shell Energy
15,027,000
$65.32
20.28%`
$981,620
30.73%
NYPA
2,167 620
$4.92w
2.93%
$10,665
0.33%,
ISO Interchange
Y (421 216),
$0.00
-0.57%
-$138,670
-4.340A
NEMA Congestion
-
0
- _
$0.00" _
-- ---
000%
_ -----
$70,472
2.21%
Coop Resales
6,304
r
$145.36
.
0.01%'
$916
0.03%
BP Energy
_-_ _
12,527,200
$46_901
16.91%1
$587,526
18.39%
Hydra, Projects*
408,778
$81.36'
- .3 s
0.55%
$33,257
1.04°�
Braintree Watson Unit
552,004 '
$70.31;
_.:
0.75%,
$38,811
1.22%
Saddleback/Jericho Wind
1,509 069
$91.99
2.04%
$138,827
4.35%
One Burlington Solar
390,650
$70.00-
0.53% ;
$27,346
0.86%
Exelon
25,307,800
$43.78
3416%'
$1,108,057
34.690A
Stonybrook Peaking
123,109
$233.06
0.17%
$28,691
0.90%
Monthly Total
74,092,068 `
643.11'
100.00%
$3,194,092
100.00%.
'Prrpporell, Woronoco,Mdian River, rumor Falls,Collln; Pioneer,Hosiory Mills, Summit Hydro
Table 2 breaks down the ISO interchange between the DA LMP Settlement and the RT
Net Energy for the month of August, 2016.
Table 2
Amount Cost % of Total
Resource of Energy of Energy Energy
(kWh) WMwh)
ISO DA LMP ' 4,488,925 $27.33 6.06%
Settlement
RT Net Energy " (4,910,141) ($52.65): -6.63%
Settlement
ISO Interchange (421,216) ($32.93) -0.57%
(Subtotal)
' Independent System Operator Day -Ahead Locational Marginal Price
Real Time Net Energy
AUGUST 2016 ENERGY BY RESOURCE
■ Stonybrook
Peaking, 0.17%, ■ Jericho Wind, 0.75%
■ One Burlington
C�1— n CZ0.0 . hA:11---- un A nroi
N Exelon, 34.34%
■ Saddleback, i..--
0
.:• Hydra
0
1
• 8P Energy, 17.00%
8.77%
CAPACITY
The RMLD hit a demand of 163,134 kW, which occurred on August 12, at 4 pm. The
RMLD's monthly UCAP requirement for August, 2016 was 230,684 Ms.
Table 3 shows the sources of capacity that the RMLD utilized to meet its requirements.
Table 3
Source
Amount (kWs)
Cost ($/kWnionth)
Total Cost $
% of Total Cost.
fAllstone #3
4,950
33.34
$165,020
8.59%
Seabrook
7,909
36.45
$288,273
15.01%
Stonybrook Peaking_
24,981
1.98_
$49368--
2.57%
Stonybrook CC
-
42,925
- --
_
7.08 _
$304,076
15.83%
NYPA
0
_ _ 0.00
_ -$6.5m
$37,177
Hydro Q
0
0-
.._ .
$13,287
_-0.34%
0.690/0
Next-�_er?
60,000
6.15,
$369,000
19.21%
Braintree Watson Unit
ISO -NE Supply Auction
0
89,919
0.00
$243 624
12.68%,
$13,287
0.26%
5.50
$494,562
25.75%
Total
230,684
$8.30
$1,920,704
100.00%
Table 4 shows the dollar amounts for energy and capacity per source
Table 4
Cost of
% of
Amt of Energy
Power
Resource
Energy
Capacity
Total cost
Total Cost
(kWh)
($/kWh)
Millstone #3
$24,661
$165,020
$189,681
3.71%
3,649,666
0.0520
Seabrook
$37,177
$288,273
$325,449
6.36%'
5,882,459
0.0553
Stonybrook Intermediate
$244,738
$304,076
$548,814
10.73%
6,961,625
0.0788
Hydro Quebec
$0
$13,287
$13,287
0.26%
-
0.0000
Shell Energy
$981,620
$0
$981,620
19.190/0
15,027,000
0.0653
NextEra
$0
$369,000
$369,000
7.21%
-
0.0000
* NYPA
$10,665
46,506
$4,159
0.08%
2,167,620
0.0019
ISO Interchange
-$138,670-
--
$494,562
_ _
$355,891
6.96%
(421,216)
-0.8449
Nema Congestion
_.
$70,472
$0
$70,4721.38%
-
0.0000;
BP Energy
$587,526
$0`
$587,526
11.49%
12,527,200
0.0469
Hydro Projects
$33,257
$0'
$33,257
0.65%
408,778
0.0814
Braintree Watson Unit
$38,811
$_243,624
$282,435
5.52%
552,004
0.5117
* Saddleback/Jericho
$138,827
$0
$138,827
2.71%
1,509,069
0.0920
# one Burlington Solar
$27,346
$0
$27,346
0.53%
390,650
0.0700
Coop Resales
$916
$0
$916
0.02%
6,3040.1454
Exelon Energy
$1,108,057
$0
$1,108,057
21.66%
25,307,800 .
0.0438'
Stonybrook Peaking
$28,691
$49,368
$78,060
1.53%
123,109
0.6341
Monthly Total
$3,194,092
$1,920,704
$5,114,796
100.00%
74,092,068
0.0690
* Renewable Resources
6.04%
RENEWABLE ENERGY CERTIFICATES (RECO
Table 5 shows the amount of banked and projected RECs for the Swift River Hydro
Projects through August 2016, as well as their estimated market value.
TRANSMISSION
The RMLD's total transmission costs for the month of August, 2016 were $1,370,117
This is an increase of 12.74% from the July transmission cost of $1,215,292. In August,
2015 the transmission costs were $1,309,072.
Peak Demand (kW)
Energy (kWh)
Energy ($)
Capacity ($)
Transmission($)
Total
Current Month
163,134
74,092,068
$3,194,092
$1,915,137
$1,370,117
$6,479,345
Table 6
Last Month
Last Year
Table 5
153,225
73, 246, 501
72, 200, 480
RECs Sunm ry
$3,269,589
$1,506,547
$1,723,853
Period - January 2016 - June 2016
Banked
Projected Total
Est.
RECs
RECs RECs
Dollars
Woron000
0
7,555 7,555
$188,875
Pepperell
0
3,805 3,805
$95,125
Indian River
0
1,675 1,675
$41,875
Turners Falls
0
1,135 1,135
$0
Saddlebadr
0
5,152: 5,152
$128,800
Jerkho
0
3,979' 3,979
$99,475
Sub total
0
23,301 23,301
554,150
RECs sold
$0
0
$0
Grand Total
0
23,301 23,301
$554,150
TRANSMISSION
The RMLD's total transmission costs for the month of August, 2016 were $1,370,117
This is an increase of 12.74% from the July transmission cost of $1,215,292. In August,
2015 the transmission costs were $1,309,072.
Peak Demand (kW)
Energy (kWh)
Energy ($)
Capacity ($)
Transmission($)
Total
Current Month
163,134
74,092,068
$3,194,092
$1,915,137
$1,370,117
$6,479,345
Table 6
Last Month
Last Year
155,230
153,225
73, 246, 501
72, 200, 480
$3,217,314
$3,269,589
$1,506,547
$1,723,853
$1,215,292
$5,939,153
$1,309,072
$6,302,514
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Town of Reading, Massachusetts
Municipal Light Department
SOLAR CHOICE RATE
Available in:
Reading, Lynnfield Center, North Reading, and Wilmington
MDPU #269 supersedes
and cancels MDPU #196
Applicability:
The Solar Choice Program is RMLD's implementation of the Community Shared Solar model
which meets Mass DOER eligibility criteria to qualify as a Community Shared Solar Generation
Unit as defined under 225 CMR 14.02. The Solar Choice (SC) Rate is available to all customers
of good credit standing receiving service under any rate schedule of the Department, subject to
availability of solar array project capacity.
This rate will be an additional charge to the existing RMLD rate.
For the first twelve months of the Program, the SC Rate shall be $5.00/month.
After the first twelve months of the Program, the SC Rate will be the total SC Component
Charges/Credits calculated prior to each six month period based on budgeted expenses/savings
from the SC Project and will be trued up to actual expenses/savings, with any adjustment being
carried forward to the next six month period using the formulas defined below.
SC Energy Component Charge:
SC Energy Component, in $/kWh/Month = (SC Project PPA Rate) — (Fuel Charge Rate)
Monthly SC Project Solar Production per SC share = (The total monthly solar production,
in kWh, produced by the SC Project) / (Total number of SC shares for that SC Project)
SC Energy Component Charge, in $/Month = (SC Energy Component) x (Monthly SC
Project Solar Production per SC share)
Note: For any month where the Fuel Charge Rate is greater than or equal to the SC
Project PPA Rate, the SC Energy Component Charge will be a Credit for that month.
SC Capacity Component Credit:
For each six month period, the SC Capacity Component Credit will be calculated based
on the actual solar production output of the SC Project for that period and any Capacity
Payment savings earned as a result of the SC Project output will be paid out as credits
during the following six month period.
The SC Capacity Component Credit will be calculated as follows:
Rate Filed: October 28, 2016
Effective: On Billings on or After December 1, 2016
Filed By: Coleen M. O'Brien, General Manager
Town of Reading, Massachusetts
Municipal Light Department
MDPU #269 supersedes
and cancels MDPU #196
SC Capacity Component Credit per SC share, in $ _ (The total Capacity Payment or
other Program savings, in $, earned for that period as a result of the solar power produced
by the SC Project during the Capacity Peak Hour) / (Total number of SC shares for that
SC Project)
SC Transmission Component Credit:
For each six month period, the SC Transmission Component Credit will be calculated
based on the actual solar production output of the SC Project for the completed six month
period and any Transmission Payment savings earned for that period as a result of the SC
Project output will be paid out as credits during the following six month period.
The SC Transmission Component Credit will be calculated as follows:
SC Transmission Component Credit per SC share, in $ _ (The total Transmission
Payment savings, in $, earned for that period as a result of the solar power produced by
the SC Project during Transmission Peak Hours) / (Total number of SC shares for that SC
Project)
SC Rate:
The SC Rate will be the total SC Charge/Credit, calculated as shown below. This Charge
or Credit will be added to each participating customer's monthly bill.
SC Rate = (SC Energy Component Charge, in $) — (SC Capacity Component Credit, in $)
— (SC Transmission Component Credit, in $)
Note: For any specific month, this total bill adjustment may be positive (cost to the
customer) or negative (savings to the customer).
Term:
A customer electing to be billed under this rate must be of good credit standing and shall remain
on this rate for a minimum of ten years. After ten years on this rate a customer may elect to
remain on this rate or discontinue it. If the RMLD does not receive an SC Rate termination
request from the customer, it will be assumed that the customer elects to continue to be billed
under this rate.
A thirty -day notice is required from customers who will no longer be able to participate in the
SC Rate.
Since the number of participants/SC shares are limited for each SC Project, shares will be issued
on a "first come/first served" basis and/or through a "lottery" system at the discretion of the
Rate Filed: October 28, 2016
Effective: On Billings on or After December 1, 2016
Filed By: Coleen M. O'Brien, General Manager
Town of Reading, Massachusetts
Municipal Light Department
MDPU #269 supersedes
and cancels MDPU #196
RMLD. The RMLD will maintain a "waiting list" which will be used to replace any customers
who must leave the program and/or for new SC Projects as they become available.
Any customers joining an SC Project after the first twelve months of that SC Project will be
charged a one-time enrollment fee of $60.00 and then begin receiving the current monthly SC
Rate program billing adjustment.
This rate will be subject to termination in the event that the RMLD is unable to procure power
from the SC Project, or costs become prohibitive.
General Terms and Conditions:
Service hereunder is subject to the General Terms and Conditions which are incorporated herein
and are a part of this rate schedule.
Rate Filed: October 28, 2016
Effective: On Billings on or After December 1, 2016
Filed By: Coleen M. O'Brien, General Manager
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RMLD
October 17, 2016
Reding Municipal Light Department
RRLIAILI FOVRR FOR GINIRATIONf
230 Ash Street
P.O. Box 150
Reading, MA 01867-0230
Tel: (781) 944-1340
Fax: (781) 942-2409
Web: ww'wmnkLcom
Town of Reading Municipal Light Board
Subject: 1FP 2017-15 Capacitor Bank
Pursuant to M.G.L c. 164 ¢ 56D, on September 21, 2016, a bid invitation was placed as a legal notice in the
Middlesex East section of the Daily Times Chronicle and on the ECHE (Energy Council of the Northeast) website
requesting sealed proposals for Capacitor Bank.
An invitation for proposals was sent to the following seventeen companies:
E.L. Flowers & Associates Eaton Cooper Power System Business ECHE Members
Genergy Graybar Hasgo Power Sales
FID Industrial Services J.F. Gray & Associates MetroWest
Omicron Electronics Corp. USA Power Sales Group Power Tech dba UPSC
Robinson Sales Shamrock Power Siemens Industry Inc.
Weidman Electrical Technology, Inc. WESCO '
A sealed proposal was received from one company: WESCO.
The sealed proposals were publicly opened and read aloud at 11:00 am., October 6, 2016, in the Town of Reading
Municipal Light Department's Audio Visual Spurr Room, 230 Ash Street, Reading, Massachusetts.
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager.
Move that proposal 2017-15 for Capacitor Bank be awarded to WESCO for $34,480.00 pursuant to Chapter
164 § 56D on the recommendation of the General Manager.
The FYI Capital Budget amount for this item is $30,000.
Peter FGa
ig�,
Hamid J
Coleen O'Brien
Attachment 5
File: Bid/FY17/2017-15 Capadbor Bank
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October 17, 2016
Reading Municipal Light Department
RILIARLI POWER !O■ GENERATIONS
230 Ash Strom
P.O. Box 130
Reading, MA 01867-0230
Tel: (781) 944-1340
Fax: (781) 942-2409
Web: www.rmld.00m
Town of Reading Municipal Light Board
Subject: IFP 2017-20 750 MCM Cable
Pursuant to M.G.L c. 164 § 56D, on September 21, 2016, a bid invitation was placed as a legal notice in the
Middlesex East section of the Daily Times Chronicle and on the ECNE (Energy Council of the Northeast) website
requesting sealed proposals for 750 MCM Cable.
An invitation for proposals was sent to the following twenty companies:
A.A. MacPherson Co., Inc.
E.L. Flowers
General Cable
Marmon Utility
Power dt Tel. Enterprise
Stuart Irby
Yale Electrical Supply
Arthur Hurley Company
Eupen Cable
Graybar Electric Company
The Okonite Company
Power Sales Group
USA Power Cable
Yusen Associates
Champion Wire and Cable
First Line Associates
HaW Power
Pirelli Cables do Systems
Shamrock Power Sales Inc
WESCO
Sealed proposals were received from three companies: Arthur Hurley Company, The Okonite Company and WESCO.
The sealed proposals were publicly opened and read aloud at 11:00 a.m., October 6, 2016, in the Town of Reading
Municipal Light Department's Audio Visual Spurr Room, 230 Ash Street, Reading, Massachusetts.
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager. .
Move that proposal 2017-20 for. 750 MCM Cable be awarded to: Arthur Harley Company for
$104,513.10 pursuant to Chapter 164 § 56D on the recommendation of the General Manager.
The FYI Capital Budget amount for this item is S 170,000.
Peter 'ce
Hamid Jaffar
Coleen O'Brien
File: Bid/FY17/2017-20 750 MCM Cable
w�
RMLD 0
October 17, 2016
Reading Municipal Light Department
RILIAILI FOWIR POR GRNRIATIONf
230 Ash Shw
P.O. Box 130
Reading, MA 01867-02.50
Tel: (781) 944-1340
Fax: (781) 942-2409
Web: wwwmnkt.com
Town of Reading Municipal Light Board
Subject: LFP 2017-22 Single Phase Step Voltage Regulator
Pursuant to MAL c. 164 § 56D, on September 21, 2016, a bid invitation was placed as a legal notice in the
MkIdlesex East section of the Daily Times Chronicle and on the ECHE (Energy Council of the Northeast) website
requesting sealed proposals for Single Phase Step Voltage Regulator.
An invitation for proposals was sent to the following seventeen companies:
Eaton Cooper Power System Business EDI Graybar Electric
Hugo Pow IF Gray Jordan Transformer
Omicron Pacific Crest Transformers Power Sales Group
Power Tech-UPSC Robinson Sales Shamrock Power Sales Inc.
Smart Irby Transformer Exchange Ward Transformer Sales
WESCO Yale Electric Supply
Sealed proposals were received from two companies: Graybar Electric and Power Sales Group
The sealed proposals were publicly opened and read aloud at 11:00 a.m., October 6, 2016, in the Town of Reading
Municipal Light Department's Audio Visual Spun Room, 230 Ash Street, Reading, Massachusetts.
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager.
Move that proposal 2017-22 for Single Phase Step Voltage Regulator be awarded to: Graybar Electric for
$146,090.00 pursuant to Chapter 164 § 56D on the recommendation of the General Manager.
This was unbudgeted equipment, but was required for a voltage adjustment in Lynnfield and will be paid for from routine
construction.
Pew Price
'J
Coleen O'Brien
File Bid/FY17/2M7-22 Single Phase Step Voltage Regulator
R
RMLD
October 17, 2016
Reading Municipal Light D"rtmnt
IRLIARLR FOWAR FOR GRNRRATIONS
230 Ash Street
P.O. Box 150
Reading, MA 01867-0250
Tel: (781) 944-1340
Fax: (781) 942-2409
Web: wwwmnkLoom
Town of Reading Municipal Light Board
Subject: IFP 2017-24 Single Phase Submersible Transformer
Pursuant to MAL c. 164 § 56D, on September 21, 2016, a bid invitation was placed as a legal notice in the
Middlesex East section of the Daily Times Chronicle and on the ECNE (Energy Council of the Northeast) website
requesting sealed proposals for Single Phase Submersible Transformer.
An invitation for proposals was sent to the following eighteen companies:
Eaton Cooper Power System Business
Graybar Electric
Jordan Transformer
Power Tech-UPSC
Stuart Irby
Weidmann Electrical Technology, Inc.
EDI
Hasgo Power
Pacific Crest Transformers
RSI - Robinson Sales Inc.
Transformer Exchange
WESCO
First Line Associates
IF Gray
Power Sales Group (Howard Industries)
Shamrock Power Sales Inc.
Ward Transformer Sales
Yale Electric Supply
Sealed proposals were received from three companies: Central Moloney, WESCO and Howard Industries c/o Power
Sales Group.
The sealed proposals were publicly opened and read aloud at 11:00 am., October 6, 2016, in the Town of Reading
Municipal Light Department's Audio Visual Spurr Room, 230 Ash Street, Reading, Massachusetts.
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager.
Move that proposal 2017-24 for Single Phase Submersible Transformer be awarded to: Central Moloney,
Inc. for $19,994.00 pursuant to Chapter 164 § 56D on the recommendation of the General Manager.
The FYI Capital Budget amount for this item is $20,000.
Peter Price
Hamid Jaff r
/
Coleen O'Brien
File: Bid/FY17/2017-24 Single Phase Submersible Transformer
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RMLD
October 17, 2016
Reading Municipal Light Department
RRLIARLR POWER FOR GENERATIONS
230 Ash Street
P.O. Boz 130
Reading, MA 01867-0230
'lel: (781) 944-1340
Fax: (781)942-2409
Web: www.rmld.com
Town of Reading Municipal Light Board
Subject: IFP 2017-25 Control Devices for Substation 3
Pursuant to M.G.L c. 164 § 56D, on September 21, 2016, a bid invitation was placed as a legal notice in the
Middlesex East section of the Daily Times Chronicle and on the ECHE (Energy Council of the Northeast) website
requesting sealed proposals for Control Devices for Substation 3.
An invitation for proposals was sent to the following twenty companies:
AA. MacPherson Co.
Eaton Cooper Power System Business
Genergy
HD Industrial Srvs.
Omicron Electronics Corp. USA
Robinson Saks
Weitinwm Electrical Technology, Inc.
Circuit Breaker Sales NE
ElectriComm, Inc.
Graybar Electric
J.F. Gray & Associates
Power Sales Group
Shamrock Power
WESCO
E.L. Flowers & Associates
First Line Associates
Hasgo Power Sales
MetroWest
Power Tech dba UPSC
Siemens Industry, Inc.
Sealed proposals were received from two companies: Graybar Electric and WESCO.
The sealed proposals were publicly opened and read aloud at 11:00 am., October 6, 2016, in the Town of Reading
Municipal Light Department's Audio Visual Spurr Room, 230 Ash Street, Reading, Massachusetts.
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager.
Move that proposal 2017-25 for. Control Devices for Substation 3 be awarded to: WESCO for $62,866.00
and Graybar Electric for $64,401.28, for a total of $127,267.28, pursuant to Chapter 164 § 56D on the
recommendation of the General Manager.
The FYI Capital Budget amount for these items is $1 ()0,000.
Nick 'Alleva
vC�
Hamid lafficK
/ � "D
Coleen O'Brien
File: Bid/FY17/2017-25 Control Devices for Substation 3
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1`MLD R"d'ng Municipal Light Department
RELIABLE POWER FOR GENERATIONS
230 Ash Street, P.O. Boa 150
Reading, MA 01867-0250
October 14, 2016
Town of Reading Municipal Light Board
Subject: IFP 2017-28 Material Handler with Trade -In
Pursuant to M.G.L. c. 164 § 56D, on September 28, 2016 an invitation for proposal was placed as a legal notice in the
Middlesex East Section of the Daily Chronicle and on the ECNE (Energy
requesting sealed proposals for one Material Handler with Trade -In (200(6 �Material idler). Northeast) website
An invitation for proposal was sent to the following twenty-five companies:
Altec Industries Inc.
Coastal International Truck,
LLC
Dejana Truck Equipment
G & S Industrial, Inc.
Liberty International
Moore GMC Truck Inc.
Nutmeg International Trucks,
Inc.
Raymond Bucket Guys
Taylor k Lloyd, Inc.
Baker Equipment
ECNE Members
James A. Kiley Company
Mid -State International Trucks,
Inc.
Morse Manufacturing Inc.
Patriot International Trucks of
Boston, LLC
Stoneham Ford
Boston Freightliner, Inc.
DC Bates
Fredrickson Bros., Inc.
Liberty Chevrolet
Minuteman Trucks
NESCO
Place Motor, Inc.
Sunrise Equipment Company
Sealed proposals were received from three companies: Altec Industries Inc., Boston Freightliner Inc and James A.
Kiley Company.
The sealed proposals were publicly opened and read aloud at 11:00 a.m. on October 6,
2016 in Municipal Light Department's Audio Visual Spurr Room, 230 Ash Street, Reading, Massachusetts. Town of Reading
The proposals were reviewed, analyzed and evaluated by staff and recommended to the General Manager.
Move that proposal 2017-28 for one: Material Handler with Trade -In be awarded to:
James A. Kiley
Company for $221,715.00 pursuant to M.G.L. c. 164 § 56D on the recommendation of the General Manager.
The FY2017 Capital Budget amount for this item is $250,000.00.
Paul McGonagle
q. _�d_�A
Coleen O'Brien
File: Proposal/FY17/2017-28 Material Handier with Trade -In
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Tracy Schultz
Sent:
Thursday, October 13, 2016 8:11 AM
To:
RMLD Board Members Group
Cc:
Jeanne Foti
Subject:
Account Payable and Payroll Questions
Good morning,
The following timeframes had no Account Payable and Payroll questions.
Account Payable Warrant — No Questions
September 30 and October 7
Payroll — No Questions
October 3
This e-mail will be printed for the Board Packet for the RMLD Board meeting on October 20, 2016.
Thanksl
Tracy Schultz
Executive Assistant
Reading Municipal Light Department
230 Ash Street
Reading, MA 01867
Tel: (781) 942-6489
Ext: 489
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