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HomeMy WebLinkAbout2021-06-03 RMLD Board of Commissioners Minuteso g '4610EIVED Town of Reading TOWN CLERK el Meeting Minutes READING, MA. F021 SEP 27 L(- PM 12: 31 Board - Committee - Commission - Council: RMID Board of Commissioners Date: 2021-06-03 Time: 7:30 PM Building: Location: Address: Session: Open Session Purpose: General Business Version: Final Attendees: Members - Present: Mr. Robert Coulter, Chair; Mr. Philip Pacino, Vice Chair; Mr. John Stempeck, Commissioner; Mr. David Talbot, Commissioner; Ms. Marlena Bita, Commissioner Members - Not Present: RMLD Staff: Ms. Coleen O'Brien, General Manager; Mr. Hamid Jaffari, Director of Engineering & Operations; Mr. Greg Phipps, Director of Integrated Resources;Ms. Wendy Markiewicz, Director of Business Finance; Mr. Brian Hatch, Director of Information Technology; Mr. John McDonagh, Assistant Director of Engineering and Operations; Mr. Tom 011ila, Integrated Resource Engineer; Ms. Kathleen Rybak, Operational Assistant to Engineering & Operations; Ms. Erica Morse, Executive Assistant; Mr. Vivek Soni, Vice Chair, CAB, Reading Others Present: Presenting: Mr. Andrew Gordon, Audit Supervisor, Melanson; Mr. Zack Fentross, Audit Manager, Melanson Public: Mr. John Rogers, 39 Tower Hill Road, North Reading Minutes Respectfully Submitted By: Philip Pacino, Secretary Pro Tem Topics of Discussion: Due to the pandemic and the March 12, 2020, Govemor's Executive Order Suspending the Certain Provisions of the Open Meeting Law, all participants attended remotely. 1. Call Meetino to Order - Vice Chair Pacino. Coverino Chair Covering Chair Pacino called the meeting to order at 7:30 PM and read RMLD's Code of Conduct. Covering Chair Pacino announced that this meeting of the Reading Municipal Light Department Board of Commissioners is being held remotely on Zoom and live on RCN and YouTube. Mr. Pacino was the Board Secretary at the meeting. Introductions Covering Chair Pacino welcomed everyone to the meeting of the RMLD Board of Commissioners and asked all attendees to identify themselves. 2. Public Comment - Vice Chair Pacino. Covering Chair Citizens' Advisory Board Meetino Mr. Soni reported that the Citizens' Advisory Board voted to recommend approval of the topics on the June Board of Commissioners agenda. Page 1 1 Public Comment Mr. Rogers attended the meeting on behalf of GRACE (Greater Reading Alliance for Clean Energy) and thanked Mr. Pacino for allowing the public to engage in the meeting. 3. Presentation of 2020 Financial Audit Findinas - Mr. Andrew Gordon, Audit Supervisor Melanson; Mr. Zack Fentross, Audit Manager, Melanson Materials; Board Packet; Annual Financial Statements; Financial Report Mr. Pacino reported that the RMLD Board of Commissioners Audit Subcommittee met with the Town of Reading Audit Committee; both Committees voted unanimously to recommend that the Board accept the Audit. Mr. Gordon presented the financial statements in a comparative basis for the first time in years. The lack of comparative statements in the past was because the department moved to a December 31 year end from a June 30 year end as well as the implementation of GASB (Governmental Amounting Standard Board) 74 and 75. The takeaway of the 2020 Audit findings was that the department had positive operating results; a well-funded OPEB Trust Fund; and there was no management letter. RMLD received a clean opinion; the best opinion you can receive from an Independent Audit; and there are no exceptions. This opinion is consistent with prior year with prior years. Mr. Gordon reported that the net of accumulated depreciation increased from CY19 by approximately $2.4m. This increase consists of $7.3m In additions to capital assets less $4.7m depreciation expense for the year. The net pension liability, which is the department's portion of total unfunded liability for the Reading Contributory Retirement System (measured as of December 31, 2019), decreased $2.5m from the prior year. The primary reason for the decrease is due to the Retirement System's investment results coming in greater than anticipated ($30.1m); of that, RMLD's benefit was about $2.9m. RMLD's proportionate share of total unfunded liability is about 28.35%. The Reading Retirement System is funded higher at 78.24% than the average seen in the Commonwealth (66%). The RMLD set aside $6.6m to fund future appropriations to the retirement system. These funds (Per GASB) cannot be used to reduce the net pension liability. (Page 8) Mr. Gordon stated that the net OPEB liability balance increased $7.2k from the prior year. Mr. Gordan reported on the required supplementary information for the department's other post- employment benefits, which includes health insurance and other health care benefits that the department provides for employees. Mr. Gordon Identified the total OPEB liability for 2020 ($11.6m) and the plan fiduciary net position ($4.5m); these figures demonstrate that the department has funded the total OPEB liability at 38.62%. According to Melanson, most towns or cities are between 1% and 10% funded (average); light departments in the Commonwealth are between 20% to 40% funded. RMLD is in good shape in terms of funding the total OPEB liability. (Page 44) Mr. Gordon noted there was a decrease of $2.5m in electric sales, net of discounts, in conjunction with a $3.7m decrease of purchase power. The decrease in both these items was primarily due to the decrease in cost of power from 2019-2020. The cost savings that RMLD saw as a result passed through to the customer, causing a decrease In both electric sale and purchase power operating expense. (Page 9) Mr. Pacino asked Mr. Gordon to address the conflict of timing on the pensions between timing with GASB. Mr. Gordon responded that the corresponding actuarial valuation that the department's actuary creates for Melanson to determine the OPEB liability is based as of June 30, 2018. Per GASB 75, the requirement is that the valuation must be within 30 months and one day from the financial statement date. However, per GASB 74, the actuarial valuation only must be within 24 months of the financial statement date. The valuation presented is not in accordance with GASB 74. Melanson spoke with the actuary and determined that this fact would not have a material impact on the financial opinion for RMLD, therefore, Melanson did not qualify their opinion for this year. The possibility of having separate valuations for the Page 1 2 town and RMLD was brought to the actuary's attention. Ms. Markiewicz stated in the past RMLD had a separate actuary study from the town and this was successful. Mr. Pacino made a motion, seconded by Mr. Stempeck, that Board of Commissioners accept the 2020 audit report from the Melanson fiscal year dated December 31, as presented on the recommendation of the town of Reading Audit Committee and the RMLD Board of Commissioners Audit Subcommittee. Motion Carried 5:0:0 Roll call vote: Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Chair Coulter, Aye; Ms. Bita, Aye. 4. Report on Citizens' Advisory Board Meetina on lune 3. 2021 -Chair Coulter Chair Coulter reported that the Citizen's Advisory Board voted unanimously to accept the Gravity contract, the new production environment, and approved attendance at the 2021 NEPPA Conference. S. General Manager's Report (Attachment 2) -Ms. O'Brien. General Manager Materials: NEPPA's 2021 Annual Conference. Presentation, PDF Document Ms. O'Brien reported on the following: RMLD Community Update Virtual Electric Vehicle Workshop This was held on April 27th attended by 75+ people. The roundtable was informative and provided excellent feedback. Some community tv stations will be broadcasting the event. RMLD plans to have another EV Workshop In September during the national drive week. The RMLD will likely have an additional heat pump round table before year. end The High School Art Contest Virtual Awards Ceremony This was held on May 12th. The RMLD thanked Messrs. Pacino and Stempeck for their attendance, as well as giving out the awards. The winner will be displayed on the front cover of the RMLD Annual Report, which will be out by the end of lune. YMCA's Healthy Kids Day The RMLD participated In Burbank YMCA's Healthy Kids Day on May 22nd presented electrical safety information to the children in attendance. The Virtual Electrification Presentation This will be taking place on June 7'^ at 2:30 PM in partnership with the Wilmington, Reading, and North Reading libraries. Wilmington Farmer's Market Will be taking place on June 27d'; the RMLD will be at the community table from 10:00 AM to 2:00 PM. The Annual Shred the Peak Press Release RMLD will be making a statement clarifying that the "Shred the Peak" is the overall program; the "Peak Demand Reduction pilot program" is for commercial and industrial customers; "Shred the Peak" is for residential. Northeast Public Power Association (NEPPA) Annual Conference This will be held on August 22n4 - 25"' at the Westin Portland Harborview, in Portland, Maine. Board Approval is required for General Manager travel. Discussion followed on the benefits of attending the conference. Ms. O'Brien advised those who wish to attend to make a hotel reservation as soon as possible. Mr. Stempeck made a motion, seconded by Ms. Bita, that the Board approve Ms. O'Brien's travel to, and attendance at, the NEPPA Annual Conference to take place August 22-25, 2021, at the Westin Portland Harborview in Portland, Maine. Page 1 3 Motion Carried 5:0:0. Roll call vote: Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Chair Coulter, Aye; Ms. Bita, Aye. Review the Board of Commissioners Meeting Agenda Format Ms. O'Brien stated that prior agenda formats were modified during the training sessions on Policy 30 to match the Town of Reading and modified again for this meeting. Ms. O'Brien sought confirmation on how the meetings will be structured going forward. Ms. O'Brien noted that she attended Zoom legislative meetings recently. As questions arose, the public would write comments/questions in the chat and at the end of each presentation the Chair would read the questions. Ms. O'Brien proposed that we hold questions for the end of each presentation. Mr. Pacino asked for Commissioner feedback and noted that other than allowing the public in, there is nothing that needs to be revised. Recommendation to Review General Manager's Goals Ms. O'Brien recommended that there be a separate meeting to discuss the General Manager's goals, as done last year, focusing specifically on the goals of the RMLD. Ms. O'Brien sent out her ideas for goals to the Board; economic and social justice; due diligence on power supply; and renewable non -carbon choice were the recommended goal additions. Discussion followed on the quarterly review schedule of the annual goals. Mr. Stempeck recommended that the Board and GM get back on a quarterly schedule; Mr. Pacino agreed the first check- in can be scheduled for the end of June, and the second at the end of September. Mr. Talbot commented that the Board can check in on the goals quarterly and annually, but the evaluation is also based on everything that happens in the year, not just the few goals. Chair Coulter asked; if the Board has suggestions, how Is that communicated with Open Meeting law? Mr. Pacino responded that to add "not for deliberation'; other commissioners should not respond. There have been issues with the BOS and Open Meeting taw emails, and the Board needs to be cognizant of that. 6. Review of Policy 19: Board of Commissioners - Ms. O'Brien. General Manager Materials: RMLD Policy 19: Board of Commissioners (Draft, Revision 15) Presentation, PDF Document Ms. O'Brien reported on the proposed modifications to Policy 19: Board of Commissioners. Ms. O'Brien noted that a few months ago, the RMLD made a modiflcatlon to Policy 19 for the OPEB Trust so the Town of Reading could work on submitting the Trust into PRIT for investments. To do this, the RMLD had to remove some of the OPEB language in Policy 19 that was conflicting with Policy 8. This new version reflects overall operations, committees, etc. It was noted that due to email formatting difficulties the commissioners were unable to see the redline changes on Policy 19. Discussion 2021 Policy 19 Changes Ms. O'Brien reported on the Polity 19 modification highlights: clarifying Open Meeting Law; clarifying remote and executive session; appointing a Board member to attend MEAM; switching to a calendar year and aligning the General Manager with that schedule; clarifying the outside services update; modifying public comment verbiage; modifying language to reflect a General Manager Annual Presentation for each of the towns; clarifying TFA and Power Supply under Policy 30; clarifying Board attendance at different conferences; The addition of various redlines cleaning up incomplete sentences and upgrading verbiage on ethics and dissemination of Information etc.; adding a separate attachment which outlines the current committees and resolution of the dissolved GM Committee; updating the GM goals and evaluation to take place in open session; adding the Audit Sub Committee. Ms. Bita asked a question to clarify Board Members contributing in any form to civic, charitable, and benevolent or other similar organizations (Section 7, Letter J). Mr. Pacino responded that the Commission cannot give ratepayers' money to charitable organizations. A Page 14 discussion followed regarding Board contributions to 501C3 charitable organizations verses individual contributions. Ms. O'Brien commented that she will add more clarification to the language on this section. Chair Coulter asked a question regarding the BID. If BID was deemed a charitable organization how would this conflict with a Board member who is a property holder inside of the BID area? Ms. O'Brien responded that by law RMLD Is not allowed to be a part of the BID. The RMLD by statute can not contribute to a 501C3. Chair Coulter noted that as property owner inside of the BID, he feels that this is not a good decision for the Board, as the Board should have a say on what happens In that space. Ms. O'Brien noted that the way the RMLD can contribute to those types of economic development is through the bottom-line. Ms. O'Brien cited the example of the Island at the End of Ash Street and noted that the PILOT to the town is the money that would be appropriated to create an economic development. Ms. O'Brien noted that the RMLD wants to support the concept of the BID goals, but the department's economic development support must be in certain types of programs. If the BID Is looking for electric vehicle charging stations to be In downtown as that would Improve economic development; the RMLD can help create programs as long as the money that RMLD Is contributing is directly related to RMLD business under the statutory laws. Chair Coulter noted that by not being a member of the BID, someone might be dictating or have plans for your property that you are not engaged with. Ms. O'Brien noted that economic development of the Ash Street Area is different than for BID. Mr. Talbot made a recommendation to add a sentence under goal setting, stating that the Board will look at all the duties and responsibilities that fall under the General Manager's responsibility, including the goals that result in the performance evaluation. Mr. Talbot further suggested implementing a written system where the Board sends in something that is part of the record. Mr. Talbot commented on the powers of the Board and the procedure around contracting, bids, and voting. When does something come to the Board and when does It not? Mr. Talbot noted that following this meeting he would send out any comments and proposed sentences to the Board for review. There was no vote taken on Policy 19: Board of Commissioners at this meeting. Integrated Resources Report - Mr Phioos Director of Intearated Resources Materials: Intergraded Resources Report - dated June 3, 2021 Presentation, PowerPoint. Mr. Phipps stated that the RMLD is presenting a third Hydro Power Supply opportunity; currently referred to as Plant #4 located in Eastern New York (Slide 3). Currently, hydro supply Is just under B% of RMLD's total portfolio. With the addition of this Hydro opportunity including the two previously approved Hydro projects, RMLD's hydro portfolio will be approximately 24% during the next several years. In subsequent BOC/CAB meetings, the RMLD will be presenting the growth forecasts for RMLD load. The department is targeting a portfolio mix with Hydro roughly around 20%; to manage supply risk and meet renewable/non-carbon compliance of the Climate Bill. Plant #4 is another Gravity project. Gravity. They manage 17 different hydro projects In the eastern part of the United States. This hydro plant was originally a mechanical facility and has been in place for nearly 200 years. The location Is being referred to as Plant #4 because Gravity asked the RMLD not to provide the name, however the department does know the location. Gravity has been operating this plant for quite some time, and their contract on the plant is expiring. Gravity is negotiating to purchase this asset and plans to continue to manage and operate it. This transition is another opportunity for RMLD to pick up the power supply contract. This supply opportunity Is of interest to RMLD for the following reasons: The project has a massively wide surface area across a large body of water. This means that it can be more consistent in terms of power generation. There are no known environmental issues, partly because of age and partly because these hydro plants go through extensive regulatory process at the federal, state, and local level. As a result, they are all extremely well documented. Plant #4 will be up for a FERC renewal or relicensing In a couple of years. The output is a nice size for RMLD (5% of the total load). It will have Massachusetts Class two Page 1 5 associated certificates. RMLD prefers to buy energy where the certificates are associated, as opposed to buying certificates on the open market. In terms of pricing, this contract Is just slightly below the department's average renewable portfolio prices, including the other two hydro projects. RMLD has existing contracts with Gravity. They are a known entity to RMLD; they are well established, well known, passionate about hydro, the environment and are very experienced in terms of doing hydro projects. This project fits RMLD's cost profile, load profile, and has a low risk associated with it. The contract for this opportunity is 24.5 years. If approved by the Board the RMLD hopes to complete the due diligence and execute a contract late this summer. This opportunity will likely be the last Hydro for a while, as there are not many more Hydro's until some contracts expire. Mr. Talbot asked is the location confidential now for business proprietary reason? Mr. Phipps responded that the location is in eastern part of New York State. The supply to RMLD will be picking up power in ISO New England. However, Gravity asked the department not to disclose the actual plant name at this point in time. Mr. Talbot asked why; Mr. Phipps responded that although Gravity has been operating the plant for quite some time, they are finishing the negotiation to acquire the plan. Mr. Stempeck made a motion, seconded by Mr. Talbot. that the Board of Commissioners vote to accept the General Manager's recommendation to execute a contract after proper due diligence, with Gravity Renewables for energy, including associated certificates, from a hydro facility in New York, known as Plant #4 on the recommendation of the Citizens' Advisory Board. Motion passed: 5:0:0. Roll call vote: Chair Coulter, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye, Mr. Talbot, Aye; Ms. Bita, Aye. Mr. Phipps provided an update on the Dahowa Hydro Project. The RMLD has completed the due diligence Including an independent third -party report on environmental and social due diligence. The report was a clean recommendation. This is of no surprise given the given the significant information available on this facility. Mr. Phipps reported that there are five MLPs that offer a Renewable Choice Program (Belmont, Wellesley, Shrewsbury, Mlddleborough, Taunton). Each program is unique to reflect the power portfolio, the rate base characterization, and the size of those individual MLPs. The RMLD's annual sales are 651,000 -megawatt hours per year, which makes RMLD the largest MA MLP; right below Taunton in the list on the chart. RMLD's portfolio is about 60% C&I, the balance being residential. Similarly, Taunton has a higher concentration of C&I in contrast to Belmont, Wellesley, and Middleton, who are primary residential; Shrewsbury is a mix. Each of these towns has some form of program; all are opt in, and all have an additional cost. For example, in the case of Wellesley's Voluntary Program, the $24 a month represents a full 100% renewable option. The idea behind the renewable choice for MLPs is to allow their ratepayers the opportunity to buy power that is 100% renewable as opposed to whatever threshold they're on. In relation to the Wellesley's WECARE program, Wellesley reported that the program is primarily for putting funds towards future town projects. Only 15% of the program funds are allocated to purchase REC's and another 15% has been allocated to a smalltown solar project. The Wellesley WeCare Program is not the renewable program that RMLD is considering, instead, it is project funding mechanism. It is opt -out and the cost is not significant, approximately a 4% increase. In contrast, the goal of the RMLD Renewable Choice Program is to offer an option for ratepayers that want to be either 100% renewable or non -carbon. It was proposed in previous meetings, that RMLD should offer both (renewable and non -carbon) because they are two different options. RMLD is working through the details; but both will likely be a one- year minimum commitment. Retiring MA Class 1 certificates would be different than non- carbon, as the non -carbon would have a mix of non -carbon certificates (EFECs up to MA Class n9e 16 Is). The RMLD aims to ensure that these two choices are clear to the customers, so they understand what they're buying into. Program design will enable the RMLD to administer it fairly and efficiently, on an ongoing basis. To accommodate the variability of certificate value, RMLD is proposing a fixed rate for one year and then adjust annually, as needed. Due to the fact RMLD is retiring 23% of certificates this year, the goal is offer programs to fund from 23% to 100%, the remaining 77%. In using a "retire more" model, funds that are collected from customers that want to be a part of the renewable or non -carbon choice, will be allocated toward retirement of a larger portion of the certificates that RMLD already has, certificates that the department would normally sell, Instead of retire. This would be a good fit for residential. In using the "buy more" model the department would buy more certificates and then retire them on the behalf of the RMLD's customers. RMLD would then provide the customer with a different kind of credential, so they can fulfill their sustainability requirements at the corporate level. Ms. Bite clarified that in the first model (Slide 6) the department would sell 23% and retire the balance? Mr. Phipps clarified in that left hand column, the department is going to retire 23% of total certificates and then sell the balance. Mr. Talbot asked; what's the magnitude of the revenue that comes in, in terms of the associated RECs? Mr. Phipps responded that It's recently been about $1,000,000 per year. Up until 2021, most of the certificates that were purchased, were sold. These were all associated with power purchases (associated certificates). The dollars from certificate sales were applied against purchased power costs. This netted out to be a neutral event, but roughly at a magnitude of $1,000,000 per year. Due to the fact RMLD Is not selling 23%, the amount of money not coming in could be around $800,000, highly dependent on certificate prices. 2021 Is the beginning of an upward path toward retiring more certificates; 3% more each year. Mr. Phipps reported on the key financial drivers at Reading Municipal Light Department. There are five major blocks in the cost structure at RMLD, one of those being the operating cost (Currently 30-33%); which includes the equipment, all of the distribution network, labor, and anything within the RMLD territory that RMLD will manage and operate. Overtime, this operating cost will go down as a percentage of total costs, partially because of the compound annual growth rate (CAGR) of the other cost blocks is higher. RMLD's goal for the cost of energy, transmission, and capacity blocks is to manage these to be as low as possible, for the benefit of the rate payers. By 2025 certificates will grow to 5% of the budget, and this will Increase to around 9% by 2029. This cost will grow over time (15% CAGR) because of the Climate Bill and RMLD's Policy 30 Rev 1, which requires RMLD to retire a higher percentage of certificates, each year. RMLD is managing the portfolio and looking for long-term contracts very aggressively. This is due to the limited number of non -carbon resources in RMLD's territory. Additionally, the regional load, due to the climate bill, will Increase (as will the departments) and there Is going to be increased competition for power supply sources. Certificate management is also going to become something that RMLD pays Increased attention to, and actively manages. Mr. Pacino asked a question regarding next steps. Mr. Phipps reported that RMLD is continuing to uncover new Power Supply; looking aggressively for wind and solar and working with ENE to secure a portion of the large-scale wind development offshore. In addition, RMLD Is moving forward in renewable choice and will need to hold a discussion on opt in verses out in. Ms. O'Brien stated that in the past five years the magnitude of certificates has Fluctuated. At the next meeting RMLD will put together the last five years and project out on a graph so there is a clear understanding of the numbers. Mr. Rogers made a comment commending the information provided by Mr. Phipps and suggested that RMLD and the Board may want to take this information and present to the nge 17 I public as an easy way to understand RECs as well as to provide an update on what RMLD is currently doing. Materials: RMLD Procurement Requests - IFB 2021 05 Station 3 Generator Replacement Award Letter Dated April 30, 2021 1IFB 2021 12 Tree Trimming Service Award Letter Dated May 28, 2021: (PDF Document, Board Packet). Mr. Jaffari reported the bid was sent to 24 companies, 7 respondents. RMLD has a generator at Station 3, which is used to supply power to the switchboard and switchgear during emergency conditions. Allocated in the CY2021 budget is $80,000 for this project. _Philips Electric was the only bid response that met all the requirements and did not take_any exceptions. Every other bid response either took exceptions or did not meet the requirements. Mr. Stempeck made a motion, seconded by Mr. Talbot, that bid 2021-12 for Station 3 Generator Replacement be awarded to: Phillips Electric, Inc., for $66,000.00, pursuant to M.G.L., c. 30 § 39M, as the lowest responsible and eligible bidder, on the recommendation of the General Manager. Motion Passed 5:0:0. Roll call vote: Chair Coulter, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Ms. Bits, Aye. The Tree Trimming contract was under a 6 -month extension and cannot be extended a second time per MGL. The bid was sent out to 11 companies, one respondent Mayor Tree Services. The remainder of the companies that received the bid did not respond. Mr. Jaffari reported why the bid response rate was so low. The larger tree trimming companies maintain the necessary certifications and training for performing the electrical utility line clearance and tree trimming; these companies are supporting large IOUs. In addition, they are in California, for the wildfire at a higher pay rate. Increased regulatory requirements, major storms, wildfire, and invasive pests drove up the demand for tree trimming services. The low response rate was a result of the shortage of skilled labor in the field, partly due to COVID-19. Mr. Jaffari stated that the prevailing wages rates, compared to the last contract, has doubled. As a result, the overall cost gone up by 124% due to a change in classification in the Labor Standard Act. These factors resulted in the contract price coming In higher than the anticipated budget, which calls for an examination of tree trimming in the CY22 and CY23 budgets. Ms. Bite asked a question regarding the bid process; The bid was out for less than 30 days, but maybe a longer period would have helped more bids come in. Can you repeat what you said about Califomia7 Mr. Jaffari responded that it seems the larger companies are sending their resources to west to assist with the California wildfires, where they are paid more for labor than In the East. Additionally, during COVID-19 a lot of companies lost their skilled workers, who went for other trades. Moreover, there are certifications Involved with this type of work, and these laborers must be certified with OSHA/EAHP and must have the proper training. A lot of smaller companies do not want to Invest that type of money. The department does not want to lower standards in the interest of safety because they need to work alongside RMLD staff during storms in an expedited and safe manner. Ms. Bits asked a follow up question; in other years, did you have one response? Mr. Jaffari responded that in previous years the department had more than one response for tree trimming bids. Mr. Talbot asked a question on the change in annual amount; what was the change in the annual amount from what it used to be to what it Is now under this new bid? Mr. Jaffarl Page 18 responded the major change is that tree trimming workers are now paid by prevailing wages as previously they were not. The amount of the contract remained the same from previous years to this year ($2.7m, 3 -year cycle) However, In the last three years the department budgeted for 7,702 spans, and due to the labor increase this year the department is budgeting for 3,525 spans. Mr. Talbot responded, the cost doubled, and you see no way around It? Mr. Jaffari responded yes, unfortunately. Mr. Talbot asked a follow up question, is there no way to bring contractors in house? Mr. Jaffari responded no, although RMLD can clear emergency lines (minor) there needs to be certain certifications in place for safety reasons and RMLD staff is not certified and equipped to do that type of work. Mr. Stempeck made a statement around the equipment that is involved; if this was brought in house there would be a significant Increase in capital RMLD would have to spend for both equipment and restrictions on where woodchips would be accepted. Mr. Stempeck noted that this motion needs to be move forward as the department's system reliability is a direct function of the trees getting cut. To put things into perspective, Chair Coulter noted his experience of how difficult it Is to get tree trimming service and you do have to pay. Mr. Stempeck made a motion, seconded by Chair Coulter that bid 2021-05 for Tree Trimming Services be awarded to: Mayer Tree Service, Inc., pursuant to M.G.L., c. 30 § 39M, as the lowest responsible and eligible bidder, on the recommendation of the General Manager. Motion passed 5:0:0. Roll call vote: Chair Coulter, Aye; Mr. Pedro, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Ms. Bite, Aye. 9, Policy 9 - Procurgmel3t Reauest Mr. Hatch Director of Information Technoloav Materials: RMLD New IT Production Environment with Disaster Recovery (DR) Backup Solution (dated June 3, 2021) Presentation, PDF, Board Packet Mr. Hatch reported on the background and importance of implementing the purposed RMLD New Production Environment with Disaster Recovery Project (Slide 2). Mr. Hatch reported that there is a need to upgrade the systems; the RMLD is getting close to compression levels that will not allow a nightly back up. The RMLD needs to secure a location outside of Massachusetts that will allow the department to have access to data at a moment's notice with an efficient turnaround time. This project would Include a new production system, repurposing RMLD's older equipment, and putting it In Disaster Recovery (DR). Mr. Hatch reported on the process of implementing the purposed RMLD New Production Environment with Disaster Recovery Project. RMLD will Identify an offsite coloration, or very large data center. The RMLD would rent space from this location and repurpose RMLD's current environment. Once complete, the nightly backup would be sent out to the new location. After identifying the location, the RMLD will purchase two backup systems: one placed locally and one in the active disaster recovery site. The systems would encrypt and protect any data; this will allow RMLD to have good quality backups for at least 30 days onsite, which provided RMLD with protection in case of failure. The RMLD will purchase new productions servers and storage to ensure the current data is protected and that the RMLD continues to be protected for the next four to five years. With this new production environment RMLD will have the ability to scale and grow; currently, the department does not have that capability. The current equipment is no longer sold, and as of next year will no longer be supported. The RMLD will utilize two different back-up systems: one locally and one in the disaster recovery facility. Every night the backup systems will replicate each other. The RMLD will have 30 days locally; this allows data to be saved and restored in the case of a virus, and further protects the RMLD from ransomware attacks. The new Production Environment with Disaster Recovery Project was not budgeted. The RMLD discussed this internally and spoke to several experts. Mr. Hatch noted that he has Page 19 architected this type of project several times in the past, and feels it is necessary for RMLD and to future proof the systems. RMLD would need some external services to work with the IT team to help get this implemented. Mr. Stempeck asked a question regarding companies who could outsource this for RMLD and the depreciation of the equipment. Mr. Hatch responded that the depreciation for laptops is generally three years, and this equipment would be about five. Mr. Stempeck asked a follow up question; did you do a comparison of going more to" outsourcing to the cloud" as opposed to RMLD purchasing the equipment and putting it in place? Mr. Hatch responded that RMLD did the due diligence on that, and has looked at several different vendors: AWS, Google, and Azure. Mr. Hatch responded that outsourcing these vendors was possible but the cost on average from an operating point of view would be around $300K a year. Around a year and a quarter, RMLD would match that with by purchasing it outright and then would have the remaining three and a half years "free of charge" using a basic ROI calculation. Mr. Stempeck asked if RMLD investigated Wasabi (Data Storage Company) founded by David Friend (Carbonite founder); Mr. Hatch responded that RMLD reviewed Gartner and Forrester and looked at the top ten people in that environment. Mr. Stempeck stated that Wasabi is mentioned by Gartner and is captured on their chart. Wasabi is about one half to one third of the cost of Amazon and they do not charge for acquisition of data or storage of the actual input and output of data, whether it's plugged compatible with Amazon. Mr. Stempeck noted that it may be interesting if RMLD can save a significant amount of money by doing something generic. Mr. Hatch stated that RMLD has investigated several alternatives to go into (Cloud vs. hybrid cloud) and concluded that the operation must be hybrid cloud. Chair Coulter asked a question on connectivity; is there going to be new data connections, TLS lines that are going to have to go to these vendors? Are you going to have a recurring monthly fee, on top of this cost or is it incorporated into the cost? Mr. Hatch responded that it is incorporated Into the cost, and the RMLD is working with Verizon to see If this can be incorporated into another purchase, which would be even cheaper. At this point, it would be a dedicated line direct connected to that DR location. Mr. Hatch noted the further away you are from your onsite location, the more cost associated. RMLD would look outside of New England, somewhere between 500 to 1,000 feet Inland. Mr. Stempeck made a motion, seconded by Chair Coulter that the Board of Commissioners authorize the General Manager to move forward with the RMLD New Production Environment with Disaster Recovery Project, as presented. Staff will solicit quotes from the State contract and award contracts for the project, not to exceed $420,000 in CY2021. This un -budgeted project will be paid from the Depreciation and Operating Funds. Motion passed 5:0:0. Roll call vote: Mr. Coulter, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Ms. Biba, Aye. 10. S hedulina - Chair Coulter Mr. Pacino noted that Monday night he, Messrs. Phipps, and Coulter attended the Board of Selectmen meeting and received an update on Green Communities. Mr. Pacino made a recommendation to review General Manager's Goals at the end of June 2021. The next regular session Board of Commissioners Meeting is scheduled for July 22, 2021. Mr. Pacino will be covering the July CAB Meeting. 11. Executive Session - Chair Coulter Mr. Stempeck made a motion, seconded by Chair Coulter, that the Board of Commissioners go into Executive Session pursuant to Massachusetts G.L. c.164 section 47D, exemption from public records and open meeting requirements in certain instances, to discuss competitively sensitive issues regarding options for power supply, and to consider the purchase, exchange, lease or value of real property, and return to regular session for the sole purpose of adjournment. Page 1 10 Motion passed 5:0:0. Roll call vote: Chair Coulter, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Ms. Bite, Aye. 12. Adioumment - Chair Coulter The Board of Commissioners returned to regular session for the sole purpose of adjourning and promptly adjourned at 10:00 PM Motion passed 5:0:0. Rall call vote: Chair Coulter, Aye; Mr. Pacino, Aye; Mr. Stempeck, Aye; Mr. Talbot, Aye; Ms. Bita, Aye. A true copy of the RMLD Board of Commissioners Minutes As approved by a majority of the Commission. 8 �aci�ro Philip6dB p l5ep24,202110:55ED7 Philip B. Pacino, Secretary Pro Tem RMLD Board of Commissioners Page 111