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HomeMy WebLinkAbout2016-10-20 RMLD Board of Commissioners MinutesFq O ti Town of Reading b Meeting Minutes 639'INtOPpO� 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 v ch a d E E u° P O N q O v o EEj C K a O Z v c F E o c at CL E ]to N C N N W O N N _ y. 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A^ N d = N E 4W N rel LAi N d � � a O to N 3 N N N e-1 N O N C1 � e -I � O 00 N � M N e-1 � r-1 { Ln Ln ` O N m N T 75 Inz O f � �o � N N %D hG Ln Q d' M N i 's i' g g g g g g g g g g g A 4 A^ V) 4U m Ul vi 0 u (1) LL a� zs a� 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LM � is cC0 Ln Ul) �d'- It m Ln o 00 0 00 AA 7 Ln i Ln 1 m i `h i 01 00 O ^O O w O N Cfi M N 0 i O O O O O O O s C; tC;h tc;t�h t�h t� Vim} tC; 7 i E tt 6 E j 10) i 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LM � is cC0 Ln Ul) �d'- It m Ln o 00 0 00 AA 7 Ln i Ln 1 m i `h 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 i LiC, M Q O L L p 0 0 0 0 0 w ao C L 3I I V1 V? 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V1 of N Ln m --------------------- L. o o * o L n 0~0 rMn N O1 o a° m O '~ O N toLn n O O00 N ° O 00 y/) ta/1 V} tM/� �n Vf N O 0 0 Ln Ln r4 n n O D O a' m '4 O LD N O N L C5 6 SO } --------------------- O C W %DD a II m II m II C II m « .c 7 m L L C c C M C O w C w m L to c E w N L `n o c a 3 0 �N Mm mrd It v « ° w '^ -JI, m r m a al -�'O vl « wzoo c w u Y c o m L c o Z c Imo L ti C VI O. c c lei* cc w d w d E r w a \, 3 -' � v°i W W U ai m ° i fO m m N Y U a C 1 Y an wl =?I m a n n nI CL w m a u o o 'n p L l -1O_ v N c 7 a vwi 3 'n mm O m w Q a .02 7 >� ` c 3\ +�* p A 0 vl 7 -0 w IL 7 3 c -be CO m C y Y y . V c N° a L� m a EI E° N 'w o c, cc a E E a c o E` to m y 50 -u° 3' ~ L N Q Z c col L O t co O O O Q m x w u m v o` "' m w > w w d O m 4! > 7 �Nn > > m m m YVf�C Qi LLV aI a>>> 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 E 0 LIS 0 a. 4 E 0 «2 4 to • r 1 lJ �IMW43Mw+w�zv. Il�j�linu'iW.,ti,,.. r-.; aur-•. _. y.tH _�h p } t' •j � 4 � tt Fes+ 'Y t 1 �IMW43Mw+w�zv. Il�j�linu'iW.,ti,,.. r-.; aur-•. _. y.tH _�h p } j � tt Fes+ 'Y t 1 I } 1 j � I f j b i F T fi 'f+) � _4 W ] I I 1. 'i 'f`'Yi-t lar °Vu-'S'x-s �t'+a '✓<' 4 �IMW43Mw+w�zv. Il�j�linu'iW.,ti,,.. r-.; aur-•. _. y.tH _�h clE MCS 0� U 04 M 122 co o v -v o `7 '=? C L3z. 140 C4 V d *NowMOM D CL N 0 a O W N N O:° ` V U �, E CL .°off mC a mom o h E tv p ti Zv 0 v i 5� x 5: g. � py�ts�,k„� r W yy `'"t'tLU vir"t.`'A en ta 1 N N N N N N N N N 00 O c g SZ 8 g g W StbdQ�Stg�Rs8 g � � 0000000000 r1 N R1 V Ifl h f �r w N ' X x i N Q ;u f � Q R 8 9 Q 0 U r t cs E a .: • m a r i la Y � � 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 iu) V)ON V)C jai � S W � LD � `O y� C jig C s U 42 .. .ii r i3 pr O N O O .0 w r Cr m V � Y RMLD 0 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 t t 2 E t 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 M w ASS ii► r %►M N 1111111111111111111111tMA N OGaI f OOA OOr RFs '+er rr'+r Rj ga gs E] u III!f f U O O O O N f Mr fill i fimw NI►f p[j. 1p A 00 ro M MN • r N O N O N O'' III!f f U O O O O N f Mr fill i fimw NI►f p[j. 1p A 00 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 ffi z° $ 8 8 CD 8 8 8 r �O�pp ti► M N 8 p H $$ H W 0 M N N � r � r a N R M �8 r O N SS � v 3 1NNA INNA C4 q Jeanne Foti From: 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 �§ § ,m;■ jR ■x� B®�10 m ■ § § m § �W40� k/( )40 401 -4 X240 �iT %40 Pi �k2 74 ) §4 �4 40 4)to Bcn 40 §t ;o ma �� �k kp §@ )b ; o§z � § m r n2 Z §§� ) W 2§$� § 2 g§ § `§r � c z 44 41 -4§ §� IMC z �z r� , . j § kR k% 0) § t M o 4 ! m , ; § a§b �■ �7m ! / �)\ kp §k § n2 ac §§� ) W 2§$� § 2 g§ �