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HomeMy WebLinkAbout2009-09-30 RMLD Board of Commissioners MinutesReading Municipal Light Board of Commissioners Regular Session 230 Ash Street Start Time of Regular Session: 7:30 p.m. End Time of Regular Session: 10:30 p.m. Attendees: Commissioners: Mary Ellen O'Neill, Chairman Philip Pacino, Secretary Staff: Vinnie Cameron, General Manager Nicholas D'Alleva, Station Manager Robert Fournier, Accounting/Business Manager Jane Parenteau, Energy Services Manager Citizens' Advisory Board: Arthur Carakatsane, Chair Guest: Frank Biron, Melanson Heath & Company, PC Reading, MA 01867 September 30, 2009 Richard Hahn, Vice Chair Ellen Kearns, Commissioner TOVIN CLERK } 2000 OCT 29 P 12: 49 Beth Ellen Antonio, Human Resources Manager Jeanne Foti, Executive Assistant Paula O'Leary, Operational Assistant Kevin Sullivan, Engineering and Operations Manager Opening Remarks/Approval of Meeting Agenda Chairman ONeill polled the Board to see if there were any changes to the agenda as presented for this evening's meeting. There were no changes to the agenda. itroductions 'hairman ONeill introduced Citizens' Advisory Board, Chair, Arthur Carakatsane. Presentation of Fiscal Year 2009 Audit Operating and Capital Budget, Pension/Legal Services Committee - Ms. Kearns Ms. Kearns reported that the Operating and Capital Budget, Pension/Legal Services Committee met on September 9, 2009 during which Mr. Fournier provided a presentation on the recommended transfers for the RMLD. Ms. Kearns stated that Mr. Fournier recommended the transfer of $1 million from the Rate Stabilization Fund to the Operating Fund and the transfer of $1 million from the Operating Fund to the Construction Fund. Ms. Kearns said that the vote on both transfer motions was 2:0 at this meeting. Chairman O'Neill was also present at this meeting. Chairman O'Neill asked the reasons for the transfers. Mr. Fournier replied that the transfers are needed because the results of the fiscal year 2009 show that the RMLD earned 1% of its allowable 8% return that is within the DPU statute. The full transfer to make the 8% would have been $4 million; however, the RMLD did not find it necessary to transfer the full amount, the $1 million is adequate. Mr. Pacino entered the meeting at this point. Ms. Kearns made a motion seconded by Mr. Hahn that the RMLD Board of Commissioners approve the transfer of $1 million from the Rate Stabilization Fund to the Operating Fund on the recommendation of its Board's Committee. Motion carried 4:0:0. Ms. Kearns made a motion seconded by Mr. Hahn that the RMLD Board of Commissioners approve the transfer of $1 million from the Operating Fund to the Construction Fund on the recommendation of the Board's Committee. Motion carried 4:0:0. "Melanson Heath & Company, PC - Audit Review - Mr. Frank Biron -Attachment 1 hairman ONeill introduced Mr. Frank Biron from Melanson Heath & Company, PC who presented the fiscal year 2009 audit. Regular Session Meeting Minutes September 30, 2009 Melanson Heath Company, PC - Audit Review - Mr. Frank Biron- Attachment 1 Mr. Biron presented the June 30, 2009 Financial Statements in draft form, which will be finalized after the Board accepts the Financial Statement as final. Mr. Biron reported that the Independent Auditors Report reflects that RMLD's financial statements are in accordance with Generally Accepted Accounting Principles and there are no exceptions. Mr. Biron stated that in fiscal year 2010 there will be no bonds payable. Mr. Biron pointed out that the new accounting principle requirement is that actuaries need to perform an evaluation of Other Post Employment Benefits. OPEB represents what the Department will be paying for retirees for their health and life insurance benefits. GASB Statement 45 requires that the liability be actuarially calculated in which a thirty year funding schedule is determined. There is no requirement to fund this however; a funding schedule needs to be established. If you do not fund within what is suggested in the thirty year schedule it is recorded as a liability on the books. The $436,402 in fiscal year 2009 represents the first installment of the thirty year pay down schedule. The overall OPEB liability for the RMLD is estimated to be around $8 million. Mr. Biron stated that the net income for fiscal year 2009 is $416,687 compared to the prior fiscal year $1,633,265. Mr. Biron pointed out that this year the Department incurred the OPEB expense of $436,402 which is new. Mr. Biron commented that it was a favorable year and pointed out the Department is in a strong financial position. Mr. Biron pointed out that there is no Management Letter and there has not been one in a couple of years, which is unusual because ninety percent of the audits they perform receive such letters. Mr. Biron explained that the Management Letter points out areas of improvement recommendations such as improving internal controls and efficiencies. Mr. Biron stated that the RMLD accounting department handles the books and records of the Department competently. Ms. Kearns had four suggestions/questions: • Page 4, Financial Highlights, last sentence first paragraph provide the 2008 numbers for the purchase power adjustments going forward that might be a good idea. Mr. Biron agreed. • Page 4, Capital Assets, "This decrease is due to the capitalization of prior year construction in progress" could be a misleading statement. Mr. Biron replied that it is not a misleading statement. Mr. Biron explained there are two categories of the capital assets, which are depreciable and non depreciable assets. Last year, the RMLD had a large balance in the non depreciable, which was called Construction in Progress. The projects that were completed in 2009 were reclassified into the depreciable category. • Page 24, Item 19 Participation in the Massachusetts Municipal Wholesale Electric Company - the question was asked if this was in last year's report. Mr. Biron replied that it was in the report. • Page 25, Seven municipal light departments that are Participants under PSAs with MMWEC have submitted a demand for arbitration" - Ms. Kearns has a problem that it is a little disingenuous to say that seven municipal light departments when RMLD is one of the seven, parenthesis (RMLD). After discussion the Board agreed to change wording in this section as detailed in the motion that follows. Mr. Hahn made a motion seconded by Ms. Kearns to delete the sentence on the bottom of page 25, "In the opinion of MMWEC management, the outcome of such actions will not have a material adverse effect on the financial position of the company." Top of page 26, "MMWEC cannot predict the outcome of the arbitration demand, but in the opinion of MMWEC management, it will not have a material adverse effect on the financial position of MMWEC." Motion carried 4:0:0. Audit Committee - Mr. Pacino Mr. Pacino reported that Melanson Heath & Company, made the presentation of RMLD's audit results to the Town of Reading Audit Committee on September 13, 2009. The Town of Reading Audit Committee voted unanimously to accepted the Financial Statements and recommended that the RMLD accept the Financial Statement as a final product. Chairman O'Neill said that the RMLD Board Audit Committee has no recommendation this year and is not required. Mr. Pacino made a motion seconded by Mr. Hahn that the RMLD Board accept the Financial Statements as presented by Melanson Heath & Company for the fiscal year ended June 30, 2009. Motion carried 4:0:0. Regular Session Meeting Minutes 3 September 30, 2009 Chairman O'Neill thanked Mr. Fournier for his hard work on this. .::r. Fournier said that it is his staff and the employees at the RMLD that make this result happen. Mr. Cameron also thanked Mr. Fournier and staff for getting the information to Melanson Heath timely and efficiently. Approval of August 26, 2009 Board Minutes Mr. Pacino made a motion seconded by Mr. Hahn to approve the Regular Session meeting minutes of August 26, 2009 as corrected. Motion carried 4:0:0. Report of Board Committee Power Contracts, Rate Setting, Green Power Committee - Mr. Hahn Mr. Hahn reported that the Power Contracts, Rate Setting, Green Power Committee had a Regular and an Executive Session at their meeting. Mr. Hahn said that the Middleton project was discussed although it is in the development stage. Mr. Hahn stated that they also discussed other renewable projects with a potential solar installation on RMLD's system and the possibility of a renewable energy project in New Hampshire. Braintree Electric Light Department Unit Ribbon Cutting Ceremony - Mr. Pacino Mr. Pacino reported that he attended the ribbon cutting ceremony for the new Watson Power Plant in Braintree. General Manager's Report - Mr. Cameron Mr. Cameron said that he attended the NEPPA Conference September 20 to September 23 along with two Board members and three CAB members. Mr. Cameron said that the content of the sessions was very interesting and included issues relating to the global economy and renewable power projects. Mr. Cameron pointed out that the Reading Street Fair was very successful with more attendance than anticipated and that the ?.MLD had a conservation booth. Mr. Cameron said that the T-Shirts for Public Power week have been distributed to the grade schools in the service territory. Mr. Cameron reported that in late August as a result of the construction at the Gaw substation, the West Street transmission right of way soil that was excavated was tested and found to have PCB's present. Mr. Cameron said that the Massachusetts Department of Environmental Protection, the Environmental Protection Agency, Reading Town Manager, Peter Hechenbleikner, the Board and residents of Causeway Road have been notified of the PCB issue. Financial Report for July and August, 2009 - Mr. Fournier - Attachment 2 Mr. Fournier reported on the Financial Report for July and August 2009. Ms. Kearns asked Mr. Cameron about the effect of the base revenue decreasing by ten percent in a two month period on the operating expenditures in 2010. Mr. Cameron said that it is early in the year and that he does not feel there is anything that needs to be cut on the operating side. Mr. Cameron explained that on the capital side the Department has the money for its capital projects. Power Supply Report, August 2009 - Ms. Parenteau - Attachment 3 Ms. Parenteau reported on the Power Supply Report for August 2009. Mr. Hahn asked on Table 3, if the debt service payment $33.61 can that be spread out in order that there can be an even monthly rate. Ms. Parenteau replied that she needs to speak with Mr. Fournier about accruing that because the Braintree contract involves debt service payment two times a year and charging the one time payment to the RMLD three months prior of when it is due to them. That has to be smoothed out internally. .,hairman ONeill said that she would like reformatting of the chart of usage by town broken out to see their energy savings. Chairman ONeill suggested that the Energy Efficiency Report be presented on a quarterly basis. The Board was in agreement. Regular Session Meeting Minutes September 30, 2009 Engineering and Operations Update, July and August 2009 - Mr. Sullivan - Attachment 4 Gaw Update Mr. Sullivan introduced Nick D'Alleva the new Station Manager at the RMLD. Mr. D'Alleva reported that he has a degree in Electrical Engineering from Northeastern University. He has worked at Massachusetts Electric as a distribution engineer, substation supervisor, lead role supervisor covering the North Shore and also a lead coordinator for the crews. Mr. Sullivan reported on the Gaw project. Chairman O'Neill asked relative to the Gaw project if the Department's schedule was going to be impacted by the current issue. Mr. Sullivan replied that remains to be seen. The current issue will hold up the Gaw project approximately one week. Mr. Hahn asked when the three new transformers would be energized at Gaw. Mr. Sullivan replied the end of January. Mr. Sullivan reported on the Engineering and Operations Update, July and August 2009. Mr. Sullivan reported one milestone is that the GIS project is complete with the exception of training. Ms. Kearns asked for an explanation on the Project 1 4kV Retirement - Stepdown Areas Reading because the budgeted amount is $31,000 however, $56,000 has been spent. Mr. Sullivan replied that this job was more costly than estimated because it involved upgrading a few more streets than originally planned. Chairman O'Neill questioned on the Reliability Report what were the factors that caused outages in August. Mr. Sullivan replied that in August there were 111 calls, 665 customers affected by outages. Feeder outage, 1 broken cut out, 18 area outages: 7 transformer (some of those were heat related), 3 animals, 3 broken cutouts, 3 failed hardware and 2 tree conditions. Service outages were 3 total - 1 animal and 2 connectors. , Chairman O'Neill asked how is the Department is doing on transformer outages this past year. Mr. Sullivan replied that there were 8 total transformer outages. Chairman O'Neill asked is there a way of assessing increased load before they fail. Mr. Sullivan replied that when customers add two air conditioners on a hot day it adds to the load. M. G. L. c. 30B Bids IFB 2010-01 15KV Metalclad Switchgear Mr. Sullivan stated that ten total bids were sent to both new switchgear vendors and refurbished switchgear vendors. Three bids were received, two bids from refurbished vendors and one from a new switchgear manufacturer. Ms. Kearns asked for the lifespan of a refurbished breaker versus a new breaker. Mr. Sullivan explained that there are moving parts in a refurbished breaker whose integrity would diminish. Over time proper maintenance will abate this. Mr. Pacino made a motion seconded by Mr. Hahn that bid 2010-01 for 15KV Metalclad Switchgear be awarded to Diversified Electrical Services, Inc. for a total cost of $102,250.00 as the lowest qualified bidder on the recommendation of the General Manager. Motion carried 4:0:0. IFB 2009-31 Sale of Surplus 40MVA Substation Transformers Mr. Sullivan reported that ten bids were sent and one bid was received for two transformers being removed from Gaw. Mr. Pacino made a motion seconded by Mr. Hahn that bid 2009-31 for Sale of Surplus 40 MVA Substation Transformers be awarded to Transformer Exchange for a purchase price of $300,200.00 as the only qualified bidder on the recommendation of the General Manager. Motion carried 4:0:0. IFB 2010-43 Insurance Consulting Services Ms. O'Leary explained that the Department went out to bid for insurance consultants. Ms. O'Leary explained that this bid originally went out to ninety members of Massachusetts Society of Licensed Insurance Advisors. Regular Session Meeting Minutes September 30, 2009 B 2010-43 Insurance Consulting Services is. O'Leary said that there were no responses and it is believed the specifications were too limiting. On July 15, Request for Qualifications was sent to all five hundred thirty four Massachusetts Licensed Insurance Advisors. Under Chapter 175 Section 177A insurance consultants must be licensed by the Division of Insurance. The Department received three responses. Reference checks and interviews of the three responders were performed. Discussion followed. Mr. Pacino made a motion seconded by Mr. Hahn that IFB 2009-43 for INSURANCE CONSULTING SERVICES be awarded to Romarke Insurance Brokerage, LLC at a total contract cost of $25,000 as the best-priced responsible and responsive bidder on the recommendation of the General Manager. Motion carried 4:0:0. General Discussion Chairman O`Neill said that the she watched part of the last RMLD Board meeting and was distressed at the background sound such as the pages turned and other discussion. After discussion Mr. Cameron agreed to look into the situation. BOARD MATERIAL AVAILABLE BUT NOT DISCUSSED Rate Comparisons, August 2009 E-Mail responses to Account Payable/Payroll Questions Upcoming Meetings Wednesday, October 28, RMLD Board of Commissioners Monday, November 9, Subsequent Town Meeting November 18, 2009 CAB Rotation vember, Secretary Pacino Executive Session At 9:20 p.m. Mr. Pacino made a motion seconded by Mr. Hahn that the Board go into Executive Session to discuss strategy with respect to collective bargaining, litigation, Chapter 164 Section 47D, exemption from public records and open meeting requirements in certain instances, Middleton Peaking Plant, MMWEC Arbitration, and to return to Regular Session for the sole purpose of adjournment. Motion carried by a polling of the Board 4:0:0. Ms. Kearns, Aye; Chairman O'Neill, Aye; Mr. Hahn, Aye; and Mr. Pacino, Aye. Adjournment At 10:30 p.m. Mr. Pacino made a motion seconded by Mr. Hahn to adjourn the meeting. Motion carried 4:0:0. A true copy of the RMLD Board of Commissioners minutes as approved by a majority of the Commission. Philip B. Pacino, Secretary RMLD Board of Commissioners TOWN OF READING, MA READING MUNICIPAL LIGI Annual Financial For the Year Ended Ji N IN SETTS ARTMENT ATTACHMENT 1 TABLE OF CONTENTS Statements of urianges in.riauciary ivet /Assets Notes to Financial Statements PAGE 1 3 6 7 8 9 10 11 NDEPENDENT AUDITORS' REPORT Aff' .AUW To the Municipal Light Board Town of Reading Municipal Light Department Reading, Massachusetts We have audited the accompanying financia tement he business-type activities, and the aggregate remaining fund i nA _Pt' f the Town of Reading Municipal Light Department ("the Department") 'rprise fund of the Town of Reading), as of and for the year en d June 30, 2 hich collectively comprise the Department's basic financial s as listed table of contents. These financial statements are the respon ity epart Ifs management. Our responsibility is to express an opinio ,n the statements based on our audit. _ We conducted our a St`in ac"dance auditing standards generally accepted ,N in the United Stat, s r Ameri Those s >dards require that we plan and perform the audit to obtaY asona ut whether the financial statements are free of materia ' ' a ar en . 'it includes examining, on a test basis, evidence s a orting ounts and disclosures in the financial statements. An audit a i . asse the accounting principles used and significant esti- mat I ade by rn ageme -has well as evaluating the overall financial statement p station. We beye ou udit provides a reasonable basis for our opinion.' In ou ion the fin cial statements referred to above resent fair) in all mate- rial resp the fi ial position of the business-type activities, and the aggregate remaining a i ation of the Town of Reading Municipal Light Department as of June 30, 'n ;and the respective changes in financial position and cash flows, where applicab e thereof, for the year then ended in conformity with accounting principles generally accepted in the United States of America. The management's discussion and analysis, appearing on the following pages, and the supplementary information, appearing in the back of this report, are not a required part of the basic financial statements but are supplementary informa- tion required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and present- R.. ? ation of the required supplementary information. However, we did not audit the information and express no opinion on it. The financial statements include certain prior-year summarized comparative inform- ation. Such information does not include sufficient detail to constitute a presentation in conformity with generally accepted accounting principles. Accordingly, such info- rmation should be read in conjunction with the Department's financial statements for the year ended June 30. 2008, from which the summarized information was derived. A 2 MANAGEMENT'S DISCUSSION AND ANALYSIS . Within this section of the Town of Reading Municipal Light Department's ("the Dep- artment") annual financial report, management provides a narrative discussion and analysis of the financial activities for the year ended June 30, 2009. The Depart- ment's performance is discussed and analyzed within the context of the accomp- anying financial statements and disclosures following this section. Overview of the Financial Statements: The basic financial statements include (1) the statements k'g.sseets, (2) the state- ments of revenues, expenses and changes in net asset ments of cash flows, and (4) notes to financial statements. The Statements of Net Assets is designed to o,,,7i~cate our financia ~I ,it ion as of a specific point in time. At June 30, 2009, "ows our net worth of X8',039,716 which is comprised of $ 64,107,090 inve in capi assets, $ 4,403,130 rest- ricted for depreciation fund, and $ 19,529, nr icted. The Statements of Revenues, E enses and es in Net Assets summarize our operating results and revea: uch, if an %,,,a profit was earned for the year. As discussed in more del be 5&4r the year ended June 30, 2009 was $ 416,687. The Statements of cash payments d g tr the investing a .y itianci ments of Ca Fflows inc quately cover per prow information about the cash receipts and untin n eriod. It also provides information about cities ''the same period. A review of our State- at case `receipts from operating activities ade- Summary of Net Assets Current Asset. oncurrent As - s i L4 aI Ass Curr e ` ' : fl 1 ities Noncur'° rrt Liabilities Total Liabilities Net Assets: Invested in Capital Assets, Net of Related Debt Restricted for depreciation fund Unrestricted Total Net Assets Total Liabilities and Net Assets 3 2009 $ 18,039,433 80.758.906 $ 98,798,339 $ 7,530,820 3.227.803 10,758,623 64,107,090 4,403,130 19,529,496 88,039.716 $ 98.798.339 2008 $ 22,818,228 76.532.856 $ 99.351.084 $ 8,574,307 3.153.748 11,728,055 59,879,183 2,937,735 24,806.111 87,623,029 $ 99,351,084 Summary of Changes in Net Assets 2009 2008 Operating Revenues $ 94,167,985 $ 86,946,233 Operating Expenses (92,534,445) (84,562,643) Operating Income 1,633,540 2,383,590 Non-operating Revenues (Expenses) ( 1,216,853) 750,325) Change in Net Assets 416,687 1,633,265 Beginning Net Assets 87,623 989 9,764 Ending Net Assets $ 88 A-716 $ 8 029 9 Financial Highlights: Electric sales (net of discounts) were $ 91,111, 9, an increase of 5.6% from the prior year. Kilowatt hours sold decrease 3.0% to 696,060,848 in 2009, compared to 717,664,965 in 2008 09, ratepa ere charged $ 834,086 in fuel charge adjustments, compare $ (1,6 0) in 2008. In 2009, ratepayers were charged. purchase era so 2,222,886. Operating expenses wer 1534,4 X09, an overall increase of 9:4% from enses. I Other Light oper me expe s inclu loyees' 11,Pension019,Trust736 (the for "Trust"). general operating In addition, t rust contribute 9611 - "to the Town of Reading Contributory Retirement Sy on behalf of A Department's employees. CAPIT SSET A DEBT ADMINISTRATION Capital assVS,26'5,842, tal investment in land and construction in progress at year end amounted to a decrease of $ 1,836,600 from the prior year. This de- crease is due to the capitalization of prior year construction in progress. Total investment in depreciable capital assets at year end amounted to $ 63,391,248 (net of accumulated depreciation), an increase of $ 5,514,508 from the prior year. This investment in depreciable capital assets includes structures and improvements, equipment and furnishings, and infrastructure assets. and maintenanc ts, $ 1, ,979 for v tary payments to Towns, and deprec- 2008In . fisc . The largest t po he ~ ..rtment total, was 172,contributed343 $ was 360, for 000 to the purchase power Reading exp- l iation expense o 134, , the depreciation rate remained leve at 3.0%. 4 REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the Reading Municipal Light Department's finances for all those with an interest in the govern- ment'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 Departme 230 Ash Street Reading, Massachusetts 018 IV 5 TOWN OF READING MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENTS OF NET ASSETS JUNE 30, 2009 AND 2008 ASSETS Current: Unrestricted cash.and short-term investments Receivables, net of allowance for uncollectibies Prepaid expenses Inventory Total current assets Noncurrent: Restricted cash and short-term investments Restricted investments Investment in associated companies Land and construction in progress Capital assets, net of accumulated depreciation Other Total noncurrent assets TOTAL ASSETS LIABILITIES Current: Accounts payable Customer deposits Customer advances f tr E Accrued liabilities Current o2di ; a 1, I -term R''ties: Bonds le, net of cur . portion Accrued ee co ated absences Other post-e a enefits Total noncurr ilities TOTAL LIABILITIES NET ASSETS Invested in capital assets, net of related debt Restricted for depreciation fund Unrestricted TOTAL NET ASSETS See notes to financial statements 2009 $ 8,635,772 7,087,246 753 1,563t 1 1 1,433 563,437 4,400,0 d 12. mv,_ 80 F, 5,448,255 496,335 696,517 258,000 550,000 81,713 7,530,820 2,791,401 436,402 3,227,803 10,758,623 64,107,090 4,403,130 $ 88,039,716 6 2008 $ 11,859,292 9,143,636 152,718 1,662,582 2,818,228 a ,1,779 4,400,000 122,391 3,102,442 57,876,740 99,351,084 6,450,130 481,328 710,537 303,842 550,000 78,470 8,574,307 550,000 2,603,748 3,153,748 11, 728, 055 59,879,183 2,937,735 24,806,111 $ 87,623,029 TOWN OF READING MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS FOR THE YEARS ENDED JUNE 30, 2009 AND 2008 Operating Revenues: Electric sales, net of discounts of $ 3,771,727 and $ 3,637,105, respectively Customer refunds and fuel charge adjustments: Fuel charge adjustment Purchase power adjustment Total Operating Revenues Operating Expenses: Purchase power Operating Maintenance .Depreciation Voluntary payments to towns Total Operating Expenses„ Operating Income Nonoperating Revent Contributions in aid of Interest income Interest e MMWE, sr- and Other i Total o r`g~rating Re t Change in N r t' Net Assets at Beginning of Year Net Assets at End of Year of Reading s (Expenses), Net See notes to financial statements. 2009 $ 91,11 34,086 ,,.r~ 2,222,886 94,167, 72;343 ;788 92,534,445 1,633,540 177,680 398,369 (49,911) 107,879 (39,767) (2,112,725) 301,622 (1,216,853) 416,687 87,623,029 $ 88,039,716 2008 $ 86,243,927 X1,649,970) ~ 52,276 81,946,233 69,641,773 8,701,880 2,049,360 3,023,536 1,146, 094 84,562,643 2,383,590 151,992 595,433 (85,843) 383,202 (24,797) (2,073,332) 303,020 (750,325) 1,633,265 85,989,764 $ 87,623,029 7 TOWN OF READING MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JUNE 30, 2009 AND 2008 Cash Flows From Operating Activities: Receipts from customers and users Payments to vendors and employees Customer refund, purchase power, and fuel charge adjustments Net Cash Provided By (Used For) Operating Activities Cash Flows From Noncapital Financing Activities: Return on investment to Town of Reading MMWEC refund Other Net Cash Provided By (Used For) Noncapital Financing Activities Restricted cash - Calpine liability 2009 $ 93,182,4 (90,332 3.0 (2,122, 725) 107,879 301,622 P13;224) (6,852,061) (550,000) 49,911) 7,680 (7,274,292) 398,369 (551,658) (153,289) (3,233,520) 11,859,292 8,625,772 1,633,540 3,134,387 436,402 Accounts receivable 2,056,390 Prepaid and other assets (597,112) Inventory 99,512 Accounts payable (1,001,875) Accrued liabilities 145,054 Calpine liability - energy contract buy-out - Other liabilities 987 Net Cash Provided By (Used For) Operating Activities $ 5,907,285 See notes to financial statements. 2008 $ 83,764,632 (80,289,046) 702,306 .4,177, 892 (2,073,332) 383,202 303,020 (1,387,110) (6,576,513) (550,000) (85,843) 151,992 (7,060,364) 595,433 1,154,973 1,750,406 (2,519,176) 14,378,468 $ ,11,859,292 $ 2,383,590 3,023,536 (9,108,765) (2,479,966) 385,229 (80,754) 583,732 246,740 9,108,765 115,785 $ 4,177,892 8 Cash Flows From Capital and Related Financing Activities: Arm iicitinn Anri rnnctri infinn of canital assets TOWN OF READING MUNICIPAL LIGHT DEPARTMENT FIDUCIARY FUND - RETIREMENT TRUST STATEMENTS OF FIDUCIARY NET ASSETS JUNE 30, 2009 AND 2008 ASSETS Cash and short-term investments Investments Other TOTAL ASSETS NET ASSETS Net assets held in See notes to financial statements. 16,255 2008 kv, 712 4,800,000 3,643 6,940,355 $ 6,616,255 $ 6,940,355 9 TOWN OF READING MUNICIPAL LIGHT DEPARTMENT FIDUCIARY FUND - RETIREMENT TRUST STATEMENTS OF CHANGES IN FIDUCIARY NET ASSETS FOR THE YEARS ENDED JUNE 30, 2009 AND 2008 Additions: Contributions from Reading Municipal Light Department Interest and dividend income Total additions Deductions: Paid to Reading Contributory Retirement Sys Total deductions Net increase (decrease) in net assets Net Assets Available for Bene . egin pof Year Net Assets Available for - refits. End c~ ar See notes to financial statements. 360,000 212,085 .085 185 ""41(324,100) 6,940,355 $ 6,616,255 2008 270,473 270,473 1,055,758 1,055,758 (785,285) 7,725,640 m 10 Town of Reading Municipal Light Department Notes to Financial Statements 1. Summary of Significant Accounting Policies The significant accounting policies of the Town of Reading Municipal Light Department ("the Department") (an enterprise fund of the Town of Reading) are as follows: A. Business Activity - The Department purchases r' . ity which it distri- butes to consumers within the towns of Read'.: No eading, Wilmington, and Lynnfield. B. Regulation and Basis of Accounting - ;'er Massachusetts eral Laws, the Department's electric rat r'e set b he Municipal jht Board and may be changed not less tha , ce eve ree months. Rate sched- ules are filed with the Massachusett xsent of Public Utilities (DP.U). While the DPU exercises general supe ; dry authority over the Depart- ment, the Department's r .,.are not sub - o DPU approval. The Dep- artment's policy is to pre nclal sta nts in conformity with generally accepted accou g p p,Proprietary fun Ind nonoperatin~ e~rorr~ i from prov ,y airliyg ser, tion wi propriet opera 'even sales an r ;rvi; sal are stinguis W ~at'ng reve~ues and expenses from perati evenues and expenses generally result `s and p fiund's rr acing and delivering goods in connec- al o i ti Th i p ngo ng opera ons. e pr ncipal " Ise fund are charges to customers for Ope i t e xpenses for enterprise funds include the Ns rvices, administrative expenses and depreciation on evenues and expenses not meeting this definition operating revenues and expenses. Private-se ft, standards of accounting and financial reporting issued prior to De ber 1, 1989 generally are followed in the proprietary fund ncial i ements to the extent that those standards do not conflict with fn_ 'a.n ct guidance of the Governmental Accounting Standards Board. Go "ments also have the option of following subsequent private-sector guidance for their enterprise funds, subject to this same limitation. The Department has elected not to follow subsequent private-sector guidance. C. Concentrations - The Department operates within the electric utility industry which has undergone significant restructuring and deregulation. Legislation was enacted by the Commonwealth of Massachusetts in 1998 which changed the electric industry. The law introduced. competi- tion and provided consumers with choices while assuring continued reliable service. Municipal utilities are not currently subject to this legislation, 11 D. Retirement Trust - The Reading Municipal Light Department Employees' Pension Trust (the "Trust") was established on December 30, 1966, by the Town of Reading's Municipal Light Board pursuant to Chapter 164 of the General Laws of the Commonwealth of Massachusetts. The Trust constitutes the principal instrument of a plan established by the Municipal Light Board for the purpose of funding the Department's annual required contribution to the Town of Reading Contributory Retirement System (the System), a cost sharing, multi-employ is employee ep retirement system. E. Revenues - Revenues are based on rates est the Department and filed with the DPU. Revenues from sale elec are recorded on the basis of bills rendered from month ; eter readin en on a cycle basis and are stated net of disco Recognition is to the amount of sales to customers which 'unbilled at the end o " fiscal period. F. Cash and Short-term Investments - rposes of the Statement of Cash Flows, the Department considers restricted and unrestricted cash on deposit with th reasurer t s ash or short-term invest- ments. For purpose oft f Net ts, the proprietary funds consider investments with final of hree months or less to be short-term investments. G. Investment a d local tutes place certain limitations on the nature o 'osits a invest s available. Deposits in any financial institu may not d certa l 'levels within the financial institution. Non-fi f an be made in securities issued or un- condition anteed by t ' U.S. Government or agencies that have ity o ear or less from the date of purchase and repurchase agre s gu leed by such securities with maturity dates of no more than 90 fro R-e of purchase. Investment r the Department and the Trust consist of U.S. government onds tha e being held to maturity. Investments are carried at cost. H. I Wf' Inventory consists of parts and accessories purchased for usutility business for construction, operation and maintenance purposes and is stated at average cost. Meters and transformers are capitalized when purchased. 1. 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. 12 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 construc- tion 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 tot pepartment's unrestricted net assets account. k„ Massachusetts General Laws require utility pl ;,ce to be depre- ciated at an annual rate of 3%. To change t ate, t . partment must obtain approval from the DPU. Changesnnual depre n rates may be made for financial factors rely ' b cash flow. for p xpansion, rather than engineering factors rela o estim tes of useful 'I . J. Amortization - Costs related to the i = L`l nc, `onds have been capital- ized and are being amortized over th : `he bonds. K. Accrued Compensated Alfbmaes - Emplo vacation leave is vested annually but may only be parr yard to t succeeding year with supervisor approval and, I 1, propr _ ~n t e terms of the applicable Department policy or union ';ntr Ge ` rely, sick leave may accumu- late i rdin can and rfinent contracts and policy, and is paid upon nor rmi hon at th % rrent rate of pay. The Department's policy is~ recogniz acation Ok is at the time payments are made. The fitment r ccum 4'l44ted, unused, vested sick pay as a lia- bility. mo ; G r he amount to be paid at termination at the current ra p y. Lo in 015045ti;ons - The proprietary fund financial statements report long-ter i'' bt ari~i`ther long-term obligations as liabilities in the pro- prietary fu' P "~tatement of net assets. ,Use of Estifgffir;~tes - The preparation of financial statements in conformity ge „'ly accepted accounting principles requires management to m : ,;:~imates and assumptions that affect the reported amounts of ass ~~~'and Liabilities and disclosures for contingent assets and liabilities at the date of the financial statements, and the reported amounts of the revenues and expenses during the fiscal year. Actual results could vary from estimates that were used. 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 audited financial statements are prepared in accord- ance with auditing standards generally accepted in the United States of America. To determine the net income subject to the rate of return, the Department performs the following calculation. Using the net income per 13 the audited financials, the return on investment 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 determine 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 Xthicipal e investment in associated companies less the contributions iO struction mult- iplied by eight percent. From-this calculation, Light Board will determine what cash transfers need to be ar end. 2 Cash and Investments Cash and investments as of June 30 panying financial statements as folio, Statement of net assets: Unrestricted cash an Restricted cash and Restricted investment, Fiduciary fun Cash a Mir Inves is cash w Cash and Depos' Investm ha $31 .215.464 at June 30, 2009 consist of the following: I institutions Total caW and investments $ 3,000 23,812,464 7,400,000 $31 .215,464 ng to interest Rate Risk Interest"Tte risk is the risk that the fair value of an investment will be ad- versely 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. One of the ways that the Department manages its exposure to interest rate risk is 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 provide the cash flow and liquidity needed for operations. are clayfied in the accom- -term inve is $ 8,635,772 vesture 11,563,437 4,400,000 nts 3,616,255 3,000,000 14 As of June 30, 2009, the Department (including the Pension Trust) had the following investments: Restricted Pension Maturity Moody's Investments Trust Date Rating Government agency bonds Freddie Mac $ 2,000,000 - 01/15/13 AAA Freddie Mac 1,400,000 - .7/15/14 AAA Freddie Mac 500,000 - ' /15/15 AAA Federal Home Loan Bank 500,000 - 06/01/16 AAA Federal Home Loan Mtg. Corp. - 1,200, a 01/15/13 AAA Federal Home Loan Mtg. Corp. - 1 80~a /15/14 AAA Total $ 4.400.000 $,aMDO 000 9 Disclosures Relating to Credit Risk Generally, credit risk is the risk that th I "s.per c its obligation to the holder of the invest ing of a rating by a nationally recognized s ented below is the actual r of year en' (including the Pension Trust rWV,M t types: Investment T Government Total do s he Depa`N `not limit the ted by Mass n U.S. Tre, t ' prese the wsi Legal Amo Ratinq $ 7 400 N/A redit Risk li"'investment will not fulfill is measured by the assign- I rating organization. Pres- each of the Department's Rating as of Year End Not AAA Rated $ 7,400,000 $ - $ 7.400,000 $ - t foll`0u~" .,the Town of Reading's investment policy, which does .unt th' Fcan be invested in any one issuer beyond that stipu- ,,usetts General Laws. Investments in any one issuer (other dry securities, mutual funds, and external investment pools) n , ore than 5% of the Department's total investments (including ist investments) are as follows: N'' Reported Issuer Investment Type Amount Freddie Mac Government agency bonds $ 3,900,000 Freddie Home Loan Mtg. Corp. Government agency bonds 3,000,000 Federal Home Loan Bank Government agency bonds 500,000 Custodial Credit Risk Custodial Credit Risk for deposits is the risk that, in the event of the failure of a depository financial institution, the Department will not be able to recover 15 its deposits or will not be able to recover collateral securities that are in the possession 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 givtt~o` y such bank o r trust company or banking company for such exceDepartment follows the Massachusetts statute as written, as wel own of Reading's deposit policy for custodial credit risk. Investment Type Government agency bon Town of Re g the speci- sits could not termined investments luding ere held by the same ent to buy the artm Otep st of the following at June 30, 2009: Because the Department pools its cash vti fic custodial credit risk of the Department' at June 30, 2009. As of June 30, 2009 the Pension Trust) in the following in broker-dealer (counterparty) that was u securities: Ilectible accounts Sic v nefits Insura eserve Hazardous waste fund Customer deposits 4,403,130 1,000,000 1,739,394 2,337,224 28,988 1,373,114 35,252 150,000 496,335 Investments 2,900,000 1,500,000 Total $ 11,563.437 $ 4 400.000 Restricted investments are invested in government agency bonds, which will be held to maturity, and are reported at book value of $ 4,400,000, The fair market value of the investments at June 30, 2009 was $ 4,347,636. The Department maintains the following restricted cash accounts: 16 Depreciation fund - The Department is required to reserve 3.0% of capital assets each year to fund capital improvements. - Construction fund - This account reflects a balance set aside by the Board of Commissioners to fund capital asset purchases. - Deferred fuel reserve - The Department transfers the difference bet- ween the custo.mers' monthly fuel charge adjustment and actual fuel costs into this account to be used in the event of a s 0clen increase in fuel costs. - Rate stabilization - The Department transfer in excess of 8% of capital assets into this account to be us- s ;ze customer rates. - Reserve for uncollectib a portion of the Department's It 4 Sick leave benefits - This acco actuarially determined compen Insurance reserve - ou the Board of Commis `.n Hazardous waste fund is r Commissio -,.to cover 1 the eve: r haza u Cus i r dPon Custo 4. Accounts otss account was s to offset 'bt reser. I ..useq ='offset the Department's ;at ;ence liability. nt refle glance set aside by insura ;deductible reserve. e'rvrl: et up by the Board of partmen s insurance deductible in materials incident. deposits that are held in escrow, un ftvaXsists of the following at June 30, 2009: Customer Ac- ants: ` Billed Less allow es: , Unc I . ible accounts al - iscounts :r otal billed Unbilled, net Total customer accounts Other Accounts: Merchandise sales MMWEC Flush Liens and other Total other accounts Total net receivables $ 2,768,110 ( 200,000) 183,604) 2,384,506 4,172, 945 6,557,451 125,701 107,879 296,215 529,795 $ 7.087.246 17 5. Prepaid Expenses Prepaid expenses consist of the following: Insurances $ 266,383 Purchase power 154,886 PASNY prepayment fund 332,076 Total $ 753.345 6. Inventory Inventory is comprised of supplies and mater Is 4; 'June 09, and is valued using the average cost method. 7. Investment in Associated Com a c i,bs pany, Inc. (NEH) and the Ne England Hy than one-half of one percent. Investmen ' ssociat dompani onsists of the following, at June 30, 2009: 8. Under agreements with the New Englan ransmission Electric Com- (NHH), the Department ha followin ances requirements for the Hydro- ~ b II in ment is carrying its. investmen cost -'6 The Department's e uity positi: 'in Proje less Tota " ital Asses , ;p ' ~ is a summary of fiscal year 2009 activity in capital assets (in New En - ~ n Electric , riy, Inc. . ro-Transmission . Corporation $ 46,153 Ian 76,238 The thous Beginning Balance Capital assets, being depreciated: Structures and improvements Equipment and furnishings Infrastructure Total capital assets, being depreciated $ 13,393 22,620 68.465 104,478 - .ansmission Corporation to fund its equity to . nnection. The Depart- y shares repurchased. Ending Increases Decreases Balance $ 119 $ - $ 13,512 5,624 ( 388) 27,856 2,946 ( 738) 70.673 8,689 (1,126) 112,041 (continued) $ 122.391 18 (continued) Less accumulated depreciation for: Structures and improvements Equipment and furnishings Infrastructure Total accumulated depreciation Total capital assets, being depreciated, net Capital assets, not being depreciated: Land Construction in progress Total capital assets, not being depreciated Capital assets, net ( 6,132) ( 383) - ( 6,515) ( 16,012) ( 720) 358 ( 16,374) ( 24,457) (2,033) 728 ( 25,762) ( 46,601) (3,136) 1,086 ( 48,651) 57,877 5,553 a. ( 40) 63,390 1,266 (1,836) - (1,836) 1,266 :`.876) $ 64.656 Other assets This balance consists primarily of cos bonding, which are being am =:!d over th 10. Accounts Payable Accounts payabl , 2009. 11, ated with the Department's the bonds. 9 expenses that were paid after June 30, deposits received from customers that are held in 1 "I"'resents deposits received from vendors in advance for work to° ~ by the Department. The Department recognizes these deposits after the work has been completed. 13. Accrued Liabilities Accrued liabilities consist of the following at June 30, 2009: Accrued payroll $ 175,161 Accrued interest 13,186 Other 69.653 Total $ 258.000 19 14. Bonds Payable Bonds payable consist of the following at June 30, 2009: Bonds issued December 1, 1999, in the amount of $ 5,500,000. Principal is payable annually on September 1 commencing 2000 and continuing to September 1, 2009. Interest I - i_.__ 1___ A -.__I Total 563,337 563,337 :d m lpon used pay. The proprietary fund financial statements report restricted net assets when ext- ernal constraints are placed on net assets. Specifically, restricted net assets represent depreciation fund reserves, which are restricted for future capital asset purchases, 20 17. Post-Employment Health Care and Life Insurance Benefits Other Post-Employment Benefits During the year, the Department implemented GASB Statement 45, Account- ing and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions. Statement 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 regnition of an act- uarially required contribution as an expense on the Sta:ent of Revenues, Expenses, and Changes in Net Assets when a future. ;'ree earns their post- employment benefits, rather than when they use t, .w ' ;employment ben- efit. To the extent that an entity does not fund tactua ,required contri- bution, a post-employment benefit liability is ',,ognized on statement of Net Assets over time. A. Plan Description In addition to providing the pension b `ti e'scribed in Note 18, the Department provides post-employment ; h and life insurance benefits for retired employees th e Town o ding's Massachusetts Interlocal Insurance Ass i Healt unefits Trust. Benefits, benefit levels, employee cu ; ributio p dyer contributions are governed by Chapter 32 of teach sus General Laws. As of June 30, 2008, the i,al valua + ate, approximately 72 retirees and 64 active empi~. "'es t the elvility requirements. The plan does not issue a crate fin ial repo t as • B. Benefi ! Vide, s dIMIN artrf' =.,provides post-employment medical, prescription drug, an "ii. ura %benefits to all eligible retirees and their surviving spousmployees who retire from the Department and meet the eligibi criteria will be eligible to receive these benefits. E~ a,.hr !fl ffi ntribute 30% of the cost of the medical and prescription drug determined by the MIIA Health Benefits Trust. Retirees also contribute 50% of the premium for a $ 5,000 life insurance benefit. The Department contributes the remainder of the medical, prescription drug, and life insurance plan costs on a pay-as-you-go basis. D. Annual OPEB Costs and Net OPEB Obliqation The Department's fiscal 2009 annual OPEB expense is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on 21 an ongoing basis, is projected to cover the normal cost per year and amortize the unfunded actuarial liability over a period of twenty years. The following table shows the components of the Department's annual OPEB cost for the year ending June 30, 2009, the amount actually contributed to the plan, and the change in the Department's net OPEB obligation based on an actuarial valuation as of June 30, 2008. Annual Required Contribution (ARC) Interest on net OPEB obligation Adjustment to ARC Annual OPEB cost Contributions made Increase in net OPEB Net OPEB obligation -beginning of Net OPEB obligation - end of yea The Department's annual OPEB cost, tF cost contributed to the p : ad the net 890,140 890,140 $ 436,402 ige of annual OPEB igation were as follows: erc`ntage of rOPEB (`nc+ (`nn+rihi i+c'- 40 50.97% $ 436,402 - tion as of June 30, 2009 is recorded as iabilities" Fine item. to ,he plan as of June 30, 2008, the date of the most I valuation was as follows: rued liability (AAL) ue of plan assets Unfunded actuarial accrued liability (UAAL) Net OPEB Obligation 8,085,388 8,085,388 0% 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, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the 22 Funded ratio (actuarial value of plan assets/AAL) Covered payroll (active plan members) $ N/A UAAL as a percentage of covered payroll N/A 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 information following the notes to the financial statements, presents multi- year trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. F. Actuarial Methods and Assumptions Projections of benefits for financial reporting.pu plan as understood by the Department and the the types of benefits provided at the time of e historical pattern of sharing of benefit cos .etl plan members to that point. The actua meta include techniques that are designe reduce actuarial accrued liabilities and th tuarial v with the long-term perspective of th IcL are based on the ambers and include ih valu and the veen the aartment and ods and as 1-in Lions used short-term vo Ity in of assets, consistent In the June 30, 2008 actuarial valuation,''- Projected Unit Credit actuarial } cost method was used. G 1 larial valu ssets was not determined, as the Department has n nded i aiigation. The actuarial assumptions included a 7. inv to .of return and an initial annual health care cost tre trat_ o; 10. hich decreases to a 5.0% long-term rate , If health Uenefits after seven years. The amort- ization cos F r in `htial UA 'is a level percentage of payroll amortiz ation, w'. mortiza i' i payme l'W `)Iincreasing at 2.5% per year for a period of 20 Ts. 18. Pa n PIari The Departt foll zftg he provisions of GASB Statement No. 27, (as amended by 3Ta5B 75Accounting for Pensions for State and Local government loyees, with respect to the employees' retirement funds. n pter 32 of Massachusetts General Laws assigns the System the a jty to - = 'blish and amend benefit provisions of the plan, and the Stat ure has the authority to grant cost-of-living increases. The Syste Sues a publicly available financial report which can be obtained through the Town of Reading Contributory Retirement system at Town Hall, Reading, MA. A. Plan Description The Department contributes to the Town of Reading Contributory Ret- irement System (the System), a cost-sharing, multiple-employer, defined benefit pension plan administered by a Town Retirement Board. The System provides retirement, disability and death benefits to plan mem- bers and beneficiaries. Chapter 32 of the Massachusetts General Laws 23 assigns the System the authority to establish and amend benefit prov- isions of the plan, and grant cost-of-living.increases. B. Funding Policy Plan members are required to contribute to the System at rates ranging from 5% to 11 % of annual covered compensation. The Department is required to pay into the System its share of the remaining system wide actuarially determined contribution plus administration is which are apportioned among the employers based on active -red payroll. The contributions of plan members and the Depa nt are governed by Chapter 32 of the Massachusetts General Department's contributions -to the System for the years end June 009 and 2008 were $ 896,185 and $ 1,055,758, re ctively, whi ere equal to its annual required contributions far of these years. MMWEC is a pu oration political subdivision of the Common- wealth of Mas create a means to develop a bulk power supply for its Memb and of i utilities. MWEC is authorized to construct, own, or purch wnershi erests in, : d to issue revenue bonds to finance, electric fa i (Pr has acquired ownership interests in electric facili gated by of it entities and also owns and operates its o c fac MMWEC sells all of the capability (Project Capability) a, ac roj its Members and other utilities (Project Participants) nder Pow les ments'(PSAs). Among other things, the PSAs require each ''ect Participant to pay its pro rata share of MMWEC's costs lated to the eject, which costs include debt service on the revenue bonds ed by M C to finance the Project, plus 10% of MMWEC's debt ser- vi be into a Reserve and Contingency Fund. In addition, should a Proj ipant fail to make any payment when due, other Project Partici- pants o at Project may be required to increase (step-up) their payments and correspondingly their Participant's share of that Project's Project Capa- bility to an additional amount not to exceed 25% of their.original Participant's share of that Project's Project Capability. Project Participants have coven- anted to fix, revise, and collect rates at least sufficient to meet their obliga- tions under the PSAs. MMWEC has issued separate issues of revenue bonds for each of its eight Projects, which are payable solely from, and secured solely by, the reve- nues derived from the Project to which the bonds relate, plus available funds pledged under MMWEC's Amended and Restated General Bond Resolution 24 (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 ope . d and owned by its majority owner, FPL Energy Wyman IV, LLC, an ind' 'subsidiary of NextEra Energy Resources LLC (formerly FPL Ener. C), and a 4.8% ownership interest in the Millstone Unit 3 nuclear r; ted by Dominion Nuclear Connecticut, Inc. (DNCI), the majority o ran it direct subsidiary of Dominion Resources, Inc. DN Iso owns ant' -rates the Millstone Unit 2 nuclear unit. The operati `i. `ense for the Mil ' e Unit 3 nuclear unit extends to November 25, • A t A substantial portion of MMWEC's pla est ; is an 11.6% ownership interest in the unit operated by NextEra En y Seabrook, C (formerly FPL Energy Seab,• A the mad' I subsidiary of NextEra Energ x° e 3 _,LC (f( The operating license for Sea ook St; Seabrook has stated its intents o I est a Station operating t7`, beyon„ arch 2030. AT and financing program tation nuclear generating (NextEra Seabrook) ;,,owner and an indirect rly FPL Energy LLC). ds to March, 2030. NextEra :tension of the Seabrook Pursuant t , ff"?SAs, MMW eabrook and Millstone Project Partici- pants ar able for th rtion ~°share of the costs associated with decommis , g t . costs are being funded through monthly Project billings the Project Participants are liable for their proportionate s . , u n i ed costs of a nuclear incident that might be imposed rider th 'a e-An n Act (Act). Originally enacted in 1957, the Act has been renew several Ines. In July 2005, as part of the Energy Policy Act cf 2005, Con Mks extended the Act until the end of 2025. g Mun'~, it Light Department has entered into PSAs and Power Pur- ch gr $'`ents (PPAs) with'MMWEC. Under both the PSAs and PPAs, the ent is required to make certain payments to MMWEC payable solely f 'am Department revenues. Under the PSAs, each Participant is unconditionally obligated to make all payments due to MMWEC, whether or not the Project(s) is completed or operating, and notwithstanding the suspension or interruption of the output of the Project(s). MMWEC is involved in various legal actions. In the opinion of MMWEC management, the outcome of such actions will not have a material adverse effect on the financial position of the company. Seven municipal light departments that are Participants under PSAs with MMWEC have submitted a demand for arbitration of a dispute relating to 25 charges under the PSAs. MMWEC cannot predict the outcome of the arbitration demand, but in the opinion of MMWEC management, it will not have a material adverse effect on the financial position of MMWEC. For years end Annual Costs $ 31.695.000 r theNNK's, the Department is required to pay to MMWEC peration and Maintenance (O&M) costs of the Projects ates. The Department's total O&M costs including debt PSAs were $ 16,070,000 and $ 15,726,000 for the years 2009 and 2008, respectively. After the July 1, 2009 principal payment, total capital expenditures for MMWEC's Projects amounted to 1,553,974,000, of which $ 112,010,000 represents the amount associated with the Department's share of Project Capability of the Projects in which it participates, although such amount is not allocated to the Department. MMWEC's debt outstan for the Projects includes Power Supply System Revenue Bonds totalin 70,245,000, of which $ 30,338,000 is associated with the Departme hare of Project Capability of the Projects in which it participates, uch amount is not allocated to the Department. After the July 09 p al payment, MMWEC's total future debt service requirem on outstan onds issued for the Projects is $ 614,973,000, of whic ,695,000 is anti ed to be billed to the Department in the future. A The estimated aggregate amount of RN required payments under the PSAs and Contingency Fund billings, to MWEC future years is shown Belo The government is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; and natural disasters for which the government carries commercial insurance. There were no significant reductions in insurance coverage from the previous year and have been no material settlements in excess of coverage in any of the past four fiscal years. ipal light Department's elusive of the Reserve and , 2009 and estimated for 26 20. Risk Management 21. Leases Related Party Transaction - Property Sub-Lease 22 The Department is sub-leasing facilities to the Reading Massachusetts Town Employees Federal Credit Union. The original sub-lease agreement commenced in December 2000 and ended in November 2005. A new agree- ment, which extended the lease through November 30, 2008, was signed on December 1, 2005. An additional amendment, effective D,ember 1,2008, extends the lease through November 30, 2011. The fo. ing is the future minimum rental income for the years ending June 30,x. Other Income- Property Sub-Lease The Department is sub-leas Inc. The original sub-leasel ended in November 2008. extends the lease through N agreement, th 2010 is $ 8,00 i,ng Community Television ffi`" in March 2000 and SOODecember 1, 2008 Under the terms of the new r the year ending June 30, (chases power from the Power Authority of the State n Y). This power, which is generated at Niagara, is less Y ther purchased power. Federal regulations require al ~iomers get the benefit of this lower cost. The reduc- customer bills, compared to non-residential customers is 3NY credit. PriNfifi's 2009, the Department accounted for this credit as a pur- choperating expense. In fiscal year 2009, the Department began accounp"g g for this credit as a contra-revenue, similar to its accounting treat- ment of other customer discounts and refunds. 27 READING MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF FUNDING PROGRESS REQUIRED SUPPLEMENTARY INFORMATION June 30, 2009 (Unaudited) (Amounts Expressed in thousands) Other Post-Emnlovment Benefits Actuarial Valuation Date 06/30/08 Actuarial Accrued Liability (AAL) $ 8,085,388 Unfunde See Independent Auditors' Report. 28 Funded Ratio ~(a/t) 0.0% UAAL as a Percent- age of ered Covered II Payroll ELI b-a /c N/A N/A TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENT OF NET ASSETS 8/31/09 ASSETS CURRENT UNRESTRICTED CASH RESTRICTED CASH RESTRICTED INVESTMENTS RECEIVABLES, NET PREPAID EXPENSES INVENTORY TOTAL CURRENT ASSETS NONCURRENT INVESTMENT IN ASSOCIATED CO CAPITAL ASSETS, NET OTHER ASSETS TOTAL NONCURRENT ASSETS TOTAL ASSETS LIABILITIES PREVIOUS YEAR CURRENT YEAR (SCH A P.9) 9,165,141.63 7,873,821.30 (SCH A P.9) 10,993,612.62 12,736,991.43 (SCH A P.9) 4,400,000.00 4,400,000.00 (SCH B P,10) 10,364,911.62 8,326,389.75 (SCH B P.10) 1,657,059.92 1.,514,729.88 1,576,512.33 1,538,498.26 38,157,238.12 36,390,430.62_ (SCH C P.2) 122,391.17 122,391.17 (SCH C P.2) 60,958,933.56 64,609,984.25 (SCH C P.2) 18,923.90 15,744.34 61 100,248.63 64,748 , 119.76 99,257,486.75 101 138,550.38 CURRENT ACCOUNTS PAYABLE CUSTOMER DEPOSITS CUSTOMER ADVANCES FOR CONSTRUCTION ACCRUED LIABILITIES CURRENT PORTION OF BONDS PAYABLE TOTAL CURRENT LIABILITIES NONCURRENT BONDS PAYABLE, NET OF CURRENT PORTION ACCRUED EMPLOYEE COMPENSATED ABSENCES TOTAL NONCURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS INVESTED IN CAPITAL ASSETS, NET OF RELATED DEBT RESTRICTED FOR DEPRECIATION FUND (P.9) UNRESTRICTED TOTAL NET ASSETS (P.3) TOTAL LIABILITIES AND NET ASSETS 7,159,075.32 8,304,902.86 482,692.04 495,061.98 681,042.52 705,216.89 113,924.92 503,324.14 550,000.00 0.00 8,986,734.80 10, 008,505.87 0.00 0.00 2,682,217.58 2,873,114.33 2,682,217.58 2 873,114.33 11 668,952.38 12 aa1,bLU.LU 59,858,933.56 64,609,984.25 3,477,210.47 4,969,484.55 24,252,390.34 18,677,461.38 87 588,534.37 _ 86 256,930.18_ 99,257,486.75 101 138,550.38 (1) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT NONCURRENT ASSET SCHEDULE 8/31/09 SCHEDULE OF INVESTMENTS IN ASSOCIATED COMPANIES NEW ENGLAND HYDRO ELECTRIC NEW ENGLAND HYDRO TRANSMISSION TOTAL INVESTMENTS IN ASSOCIATED COMPANIES SCHEDULE OF CAPITAL ASSETS LAND STRUCTURES AND IMPROVEMENTS EQUIPMENT AND FURNISHINGS INFRASTRUCTURE TOTAL CAPITAL ASSETS, NET CONSTRUCTION WORK IN PROGRESS TOTAL UTILITY PLANT SCHEDULE OF OTHER ASSETS PURCHASED POWER WORKING CAPITAL UNAMORTIZED DEBT EXPENSE TOTAL OTHER ASSETS TOTAL NONCURRENT ASSETS PREVIOUS YEAR 46,153.24 76,237.93 SCHEDULE C CURRENT YEAR 46,153.24 76,237.93 122,391.17 1,265,842.23 7,288,907.18 6,627,783.69 43,939,800.46 59,122,333.56 1,836,600.00 60,956,933.56 14,523.70 4,400.20 18,923.90 61,100,248.63 122,391.17 1,265,842.23 6,997,417.80 11,612,025.79 44.734.698.43 0.00 64,609,984.25 14,523.70 1,220.64 15,744.34 64,748,119.76 (2) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS 8/31/09 OPERATING REVENUES: (SCH D P.11) BASE REVENUE FUEL REVENUE PURCHASED POWER CAPACITY FORFEITED DISCOUNTS ENERGY CONSERVATION REVENUE PASNY CREDIT TOTAL OPERATING REVENUES OPERATING EXPENSES: (SCE E P.12) PURCHASED POWER BASE PURCHASED POWER FUEL OPERATING MAINTENANCE DEPRECIATION VOLUNTARY PAYMENTS TO TOWNS TOTAL OPERATING EXPENSES OPERATING INCOME NONOPERATING REVENUES (EXPENSES) CONTRIBUTIONS IN AID OF CONST RETURN ON INVESTMENT.TO READING INTEREST INCOME INTEREST EXPENSE OTHER (MDSE AND AMORT) TOTAL NONOPERATING REV (EXP) CHANGE IN NET ASSETS NET ASSETS AT BEGINNING OF YEAR NET ASSETS AT END OF AUGUST MONTH MONTH LAST YEAR CURRENT YEAR LAST YEAR CURRENT YEAR TO DATE TO DATE YTD % CHANGE 3,651,160.76 3,711,893.97 7,263,710.63 7,132,571.09 -1.81% 6,496,702.10 4,269,717.20 12,710,688.26 8,017,794.29 -36.92% 134,084.27 122,895.74 387,510.29 329,710.92 -14.92% 83,108.65 75,272.80 140,318.36 129,284.88 -7.86% 0.00 50,545.40 0.00 99,904.60 100.00% 0.00 (35,903_.32) 0.00 (39,343.48) 100.00% 10,365,055.78 8,194,421.79 20,502,227.54 15,669,922.30 -23.57% 2,213,208.36 2,680,493.12 4,522,612.83 4,946,373.91 9.379, 5,684,278.64 4,051,360.93 13,466,245.34 8,122,599.25 -39.68% 650,572.43 610,053.12 1,253,934.42 1,075,517.24 -14.23% 258,636.31 152,250.56 367,531.44 220,714.35 -39.95% 261,200.00 280,105.78 522,400.00 560,211.56 7.24% 100,750.00 104,500.00 201,500.00 209,000.00 3.72% 9,168,645.74 7,878,763.51 20,334,224.03 15,134,416.31 -25.57% 1,196,410.04 315,658.28 168,003.51 535,505.99 218.75% 23,725.46 1,370.80 44,793.69 5,212.93 j -88.36, (176,061.00) (182,220.00) (352,121.00) (364,445.00) 3.501. 26,424.43 6,161.03 68,331.50 32,409.25 -52.579, (3,923.99) (1,276.73) (7,855.25) (4,802.41) -38.86% 2,116.00 4,112.89 44,353.23 13,333.30 -69.94% (127,719.10) (171,852.01) (202,497.83) (318,291.93) 57.18% 1,068,690.94 143,806.27 (34,494.32) 217,214.06 -729.71% 87,623,028.69 88,039,716.12 0.48; 87,588,534.37 88,256,930.18 0.76% (3) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUSINESS-TYPE PROPRIETARY FUND STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS 8/31/09 OPERATING REVENUES: (SCH F P.11B) BASE REVENUE FUEL REVENUE PURCHASED POWER CAPACITY FORFEITED DISCOUNTS ENERGY CONSERVATION REVENUE PASNY CREDIT TOTAL OPERATING REVENUES OPERATING EXPENSES: (SCH G P.12A) PURCHASED POWER BASE PURCHASED POWER FUEL OPERATING MAINTENANCE DEPRECIATION VOLUNTARY PAYMENTS TO TOWNS TOTAL OPERATING EXPENSES OPERATING INCOME NONOPERATING REVENUES (EXPENSES) CONTRIBUTIONS IN AID OF CONST RETURN ON INVESTMENT TO READING INTEREST INCOME INTEREST EXPENSE OTHER (MDSE AND AMORT) TOTAL NONOPERATING REV (EXP) ACTUAL BUDGET % YEAR TO DATE YEAR TO DATE VARIANCE* CHANGE 7,132,571.09 7,886,286.00 (753,714.91) -9.56% 8.,017,794.29 8,716,367.00 (698,572.71) -8.015, 329,710.92 600,000.00 (270,289.08) -45.05% 129,284.88 173,499.00 (44,214.12) -25.48% 99,904.60 117,658.00 (17,753.40) -15.09% (39,343.48) 0.00 (39,343.48) 100.00% 15,669,922.30 17,493,810.00 (1,823,887.70) -10.43% 4,946,373.91 4,885,095.00 61,278.91 1.25% 8,122,599.25 8,716,367.00 (593,767.75) -6.81% 1,075,517.24 1,415,472.00 (339,954.76) -24.02% 220,714.35 352,076.00 (131,361.65) -37.31% 560,211.56 565,000.00 (4,788.44) -0.85% 209,000.00 209,000.00 0.00 0.00% 15,134,416.31 16,143,010.00 (11008,593.69) -6.25% 535,505.99 1,350,800.00 (815,294.01) -60.36% 5,212.93 100,000.00 (94,787.07) -94.79% (364,445.00) (364,450.00) 5.00 0.00% 32,409.25 75,000.00 (42,590.75) -56.79% (4,802.41) (6,944.00) 2,141.59 -30.84% 13,333.30 19,750.00 (6,416.70) -32.49% (318,291.93) (176,644.00) (141,647.93) 80.19% CHANGE IN NET ASSETS 217,214.06 1,174,156.00 (956,941.94) -81.50% NET ASSETS AT BEGINNING OF YEAR 88,039,716.12 88,039,716.12 0.00 0.00% NET ASSETS AT END OF AUGUST 88,256,930.18 89,213,872.12 (956,941.94) -1.07% * ( ) = ACTUAL UNDER BUDGET (3A) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT RECONCILIATION OF CAPITAL FUNDS 8/31/09 SOURCE OF CAPITAL FUNDS: DEPRECIATION FUND BALANCE 7/1/09 4,403,129.56 CONSTRUCTION FUND BALANCE 7/1/09 1,000,000.00 INTEREST ON DEPRECIATION FUND FY 10 6,143.43 DEPRECIATION TRANSFER FY 10 560,211.56 FORCED ACCOUNTS REIMBURSEMENT 0.00 GAW SUBSTATION (FY 10) 105,320.49 TOTAL SOURCE OF CAPITAL FUNDS 6,074,805.04 USE OF CAPITAL FUNDS: PAID ADDITIONS TO PLANT THRU AUGUST PAID ADDITIONS TO GAW THRU AUGUST 407,785.38 105,320.49 GENERAL LEDGER CAPITAL FUNDS BALANCE 8/31/09 5,561,699.17 PAID ADDITIONS TO GAW FROM FY 09 3,136,764.00 PAID ADDITIONS TO GAW FROM FY 08 1,895,975.00 TOTAL 5,032,739.00 (4) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SALES OF KILOWATT HOURS 8/31/09 MONTH MONTH LAST YEAR CURRENT YEAR SALES OF ELECTRICITY: LAST YEAR CURRENT YEAR TO DATE TO DATE RESIDENTIAL SALES 26,849,965 25,461,644 52,201,857 46,933,996 COMM. AND INDUSTRIAL SALES 39,929,944 36,404,770 81,898,981 73,474,310 PRIVATE STREET LIGHTING 71,989 70,020 143,390 142,069 TOTAL PRIVATE CONSUMERS _ 66,851,898 61,936,434 134,244,228 120,550,375 MUNICIPAL SALES: STREET LIGHTING MUNICIPAL BUILDINGS TOTAL MUNICIPAL CONSUMERS SALES FOR RESALE SCHOOL TOTAL KILOWATT HOURS SOLD 241,491 237,183 482,982 474,366 1,652,271 827,525 3,480,234 1,658,717 1,893,762 1,064,708 3,963,216 2,133,083 375,832 348,515 727,004 620,719 0 877,368 0 1,867,579 69,121,492 64,227,025 138,934,448 125,171,756 YTD % CHANGE -10.09% -10.29% -0.92% -10.20% -1.78% -52.34% -46.18% -14.62% 100.00% -9.91% (5) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT KILOWATT HOURS SOLD BY TOWN 8/31/09 TOTAL READING LYNNFIELD NO.READING WILMINGTON MONTH YEAR TO DATE LAST YEAR TO DATE RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL TOTAL RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL TOTAL RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL TOTAL KILOWATT HOURS SOLD TO TOTAL MONTH RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL YEAR TO DATE LAST YEAR TO DATE TOTAL RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL TOTAL RESIDENTIAL COMM & IND PVT ST LIGHTS PUB ST LIGHTS MUNI BLDGS SALES/RESALE SCHOOL TOTAL 25,461,644 7,302,423 4,069,961 5,870,472 8,218,788 36,404,770 4,575,275 290,569 5,535,944 26,002,982 70,020 13,867 1,360 20,385 34,408 237,183 78,631 32,851 39,688 86,013 827,525 209,920 132,943 165,523 319,139 348,515 877,368 348,515 352,480 0 179,934 0 89,360 0 255,594 64,227,025 12,881,111 4,707,618 11,721,372 34,916,924 46,933,996 13,725,495 7,609,527 10,231,147 15,367,827 73,474,310 9,143,383 584,259 11,236,225 52,510,443 142,069 28,698 2,720 41,642 69,009 474,366 157,262 65,702 79,376 172,026 1,658,717 407,216 281,635 328,293 641,573 620,719 620,719 0 0 0 1,867,579 742,517 414,098 211,920 499,044 125,171,756 24,825,290 8,957,941 22,128r603 69,259,922 52,201,857 16,395,700 7,887,476 11,898,966 16,019,715 85,379,215 11,537,178 1,405,195 14,939,451 57,497,391 143,390 27,654 2,760 44,542 68,434 482,982 166,234 65,702 79,092 171,954 0 0 0 0 0 727,004 727,004 0 0 0 0 0 0 0 0 138,934,448 28,853,770 9,361,133 26,962,051 73,757,494 TOTAL READING LYNNFIELD NO.READING WILMINGTON 39.64% 11.37% 6.34% 9.14% 12.79% 56.68% 7.12% 0.45% 8.62% 40.49 % 0.11% 0.02% 0.00% 0.03% 0.06% 0.37% 0.12% 0.05% 0.06% 0.14% 1.29% 0.33% 0.21% 0.26% 0.49% 0.54% 0.54% 0.00% 0.00% 0.00% 1.37% 0.55% 0.285o 0.14% 0.40% 100.00% 20.06% 7.33% 18.25% 54.36% 37.50% 10.97% 6.08% 8.17% 12.28% 58.70% 7.30% 0.47% 8.98% 41.95% 0.11% 0.02% 0.00% 0.03% 0.06% 0.38% 0.13% 0.05% 0.06% 0.14% 1.33% 0.33% 0.22% 0.26% 0.51% 0.50% 0.50% 0 . 00 % 0.00% 0.00% 1.49% 0.59% 0.33% 0.17% 0.40% 100.00% 9.83% 16% 17.68 % 55.33 37.57% 11.80% 5.68% 8.56% 11.53% 61.46% 8.30% 1.01% 10.759'. 41.40% 0.10% 0.02% 0.00% 0.03% 0.05% 0.35% 0.12% 0.0591. 0.06% 0.12% 0.00% 0.00% 0.00% 0.00% 0.00% - 0.52% 0.52% 0.00% 0.00% 0.0W, ~ t 0.00% 0.00% 0.00% 0.00% 0.00% 100.00% 20.76% 6.74% 19.40% 53.10% (6) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT FORMULA INCOME 8/31/09 TOTAL OPERATING REVENUES (P.3) ADD: LESS: POLE RENTAL INTEREST INCOME ON CUSTOMER DEPOSITS OPERATING EXPENSES (P.3) BOND INTEREST EXPENSE CUSTOMER DEPOSIT INTEREST EXPENSE FORMULA INCOME (LOSS) f 15,669,922.30 0.00 620.07 (15,134,416.31) (2,222.00) (2,580.41) 531,323.65 (7) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT GENERAL STATISTICS 8/31/09 SALE OF KWH (P.5; KWH PURCHASED AVE BASE COST PER KWH AVE BASE SALE PER KWH AVE COST PER KWH AVE SALE PER KWH FUEL CHARGE REVENUE (P.3) LOAD FACTOR PEAK LOAD MONTH OF AUG 2008 69,121,492 65,662,980 0.033706 0.052822 0.120273 0.146812 6,496,702.10 67.38% 133,494 MONTH OF % CHANGE YEAR THRU AUG 2009 2008 2009 AUG 2008 AUG 2009 64,227,025 2.59% 138,934,448 125,171,756 72,835,439 -2.25% -3.42% 141,294,688 136,465,072 0.036802 22.23% 13.24% 0.032008 0.036246 0.057793 -1.22% 8.99% 0.052282 0.056982 0.092426 79.83% -24.78% 0.127314 0.095768 0.124272 54.09% -15.81% 0.143769 0.121037 4,269,717.20 132.47% -36.92% 12,710,688.26 8,017,794.29 64.06% 155,759 (8) 'r 60 env 60 inr j 60 Nnr 60 AM ~ cn -F n, 60 ddH 0 cn J 60 UM O l- ' y : 60 8dd j 60 Ndr j 90 Oda W ' f Mtn, 90 nON f 80100 80 ddS so end go inr > 80 Nnr 80 AVA 1 so ddd j y 90 UvN ~i < 1 s0 8dd a so Ndr C ; I LO Oda 4 I LO nON LO 100 LO ddS LO env LO -inr LO Nnr j r 3 LO AVN LO adv j i LO UM s LO Hdd Lo NHr j 90 Oda 90 AON i i 90100 i 90 ddS 90 rJnt/ r O ~J ~ LO q,~t N T- ti- T O O © O C7 O O ® C.~ ® O O O -9- 63- 6S 6a -E- 69- 63- 60- TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF CASH AND INVESTMENTS 8/31/09 SCHEDULE A UNRESTRICTED CASH CASH - OPERATING FUND CASH - PETTY CASH TOTAL UNRESTRICTED CASH RESTRICTED CASH CASH - DEPRECIATION FUND CASH - CONSTRUCTION FUND CASH - TOWN PAYMENT CASH - BOND PAYMENTS CASH - DEFERRED FUEL RESERVE CASH - RATE STABILIZATION FUND CASH - UNCOLLECTIBLE ACCTS RESERVE CASH - SICK LEAVE BENEFITS CASH - INSURANCE RESERVE CASH - HAZARD WASTE RESERVE CASH - CUSTOMER DEPOSITS TOTAL RESTRICTED CASH RESTRICTED INVESTMENTS RATE STABILIZATION SICK LEAVE BENEFITS TOTAL RESTRICTED INVESTMENTS TOTAL CASH BALANCE AUGUST 2008 * FED HOME LOAN MTG CORP FED HOME LOAN MG CORP FED HOME LOAN MTG CORP FED HOME LOAN MTG CORP AUGUST 2009 * FED HOME LOAN MTG CORP FED HOME LOAN MTG CORP FED HOME LOAN MTG CORP FED HOME LOAN MTG CORP FED NATIONAL MTG ASSN PREVIOUS YEAR CURRENT YEAR 9,162,141.63 7,870,821.30 3,000.00 3,000.00 9,165,141.63 7,873,821.30 3,477,210.47 1,616,007.92 553,600.00 96,800.00 149,773.62 3,195,472.85 28,988.15 1,207,815.85 35,251.72 150,000.00 482,692.04 4,969,484.55 592,214.62 573,450.00 562,000.00 1,595,245.81 2,355,777.55 28,988.15 1,379,517.05 35,251.72 150,000.00 495,061.98 10,993,612.62 12,736,991.43 2,900,000.00 2,900,000.00 1,500,000.00 1,500,000.00 4,400,000.00 4,400,000.00 24,558,754.25 25,010,812.73 2,900,000.00; DTD 12/26/03; INT 3.501.; MATURITY 12/15/09 500,000.00; DTD 12/26/03; INT 4.00%; MATURITY 12/15/13 500,000.00; DTD 08/26/04; INT 4.00%; MATURITY 08/16/14 500,000.00; DTD 03/10/04; INT 3.50%; MATURITY 03/10/14 1,400,000.00; DTD 05/08/08; INT 3.50%; MATURITY 11/15/13 1,500,000.00; DTD 01/23/09; INT 2.00%; MATURITY 01/15/13 500,000.00; DTD 01/23/09; INT 2.00%; MATURITY 01/15/13 500,000.00; DTD 01/25/08; INT 4.25%; MATURITY 01/15/15 500,000.00; DTD 11/13/07; INT 5.25%; MATURITY 11/13/17 (9) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF ACCOUNTS RECEIVABLE 8/31/09 SCHEDULE OF ACCOUNTS RECEIVABLE RESIDENTIAL AND COMMERCIAL ACCOUNTS RECEIVABLE - OTHER ACCOUNTS RECEIVABLE - LIENS ACCOUNTS RECEIVABLE - EMPLOYEE ADVANCES SALES DISCOUNT LIABILITY RESERVE FOR UNCOLLECTIBLE ACCOUNTS TOTAL ACCOUNTS RECEIVABLE BILLED UNBILLED ACCOUNTS RECEIVABLE TOTAL ACCOUNTS RECEIVABLE, NET SCHEDULE OF PREPAYMENTS PREPAID INSURANCE PREPAYMENT PURCHASED POWER PREPAYMENT PASNY TOTAL PREPAYMENT PREVIOUS YEAR 5,703,662.61 290,080.76 78,676.89 1,067.16 (250,321.39) (220,616.16) 5,602,549.87 4,762,361.75 10,364,911.62 SCHEDULE B CURRENT YEAR 4,263,388.63 227,623.91 111,215.75 1,067.16 (243,738.33) (206.111.95) 4,153,445.17 4,172,944.58 8,326,389.75 875,823.53 413,218.99 368,017.40 1,657,Q59.92 * ACCOUNTS RECEIVABLE AGING AUGUST 2009: RESIDENTIAL AND COMMERCIAL LESS: SALES DISCOUNT LIABILITY GENERAL LEDGER BALANCE 4,263,388.63 (243,738.33) 4,019,650.30 CURRENT 30 DAYS 60 DAYS 90 DAYS OVER 90 DAYS TOTAL 950,936.32 239,257.90 324,535.66 1,514,729.88 3,353,733.29 83.43% 426,083.11 10.60% 113,904.68 2.83% 45,799.87 1.14% 80,129.35 2.00% 4,019,650.30 100.00% c10) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF OPERATING REVENUE 8/31/09 SCHEDULE D MONTH MONTH LAST YEAR CURRENT YEAR YTD SALES OF ELECTRICITY: LAST YEAR CURRENT YEAR TO DATE TO DATE CHANGE RESIDENTIAL SALES 4,212,412.05 3,436,438.89 8,062,036.60 6,234,551.81 -22.67% COMM AND INDUSTRIAL SALES 5,561,795.55 4,227,942.75 11,157,907.73 8,289,161.97 -25.715. PRIVATE STREET LIGHTING 12,566.24 10,482.33 24,675.69 20,896.97 -15.3191. TOTAL PRIVATE CONSUMERS 9,786,773.84 7,674,863.97 19,244,620.02 14,544,610.75 -24.42% MUNICIPAL SALES: STREET LIGHTING 53,623.30 47,061.26 105,998.38 92,900.83 -12.36% MUNICIPAL BUILDINGS 244,853.57 103,234.83 504,725.36 201,454.33 -60.09% TOTAL MUNICIPAL CONSUMERS 298,476.87 150,296.09 610,723.74 294,355.16 -51.80% SALES FOR RESALE 62,612.15 44,937.37 119,055.13 78,646.37 -33.94% SCHOOL 0.00 111,513.74 0.00 232,753.10 100.00% SUB-TOTAL 10,147,862.86 7,981,611.17 19,974,398.89 15,150,365.38 -24.15% FORFEITED DISCOUNTS 83,108.65 75,272.80 140,318.36 129,284.88 -7.86% PURCHASED POWER CAPACITY 134,084.27 122,895.74 387,510.29 329,710.92 -14.92% ENERGY CONSERVATION - RESIDENTIAL 0.00 12,736.28 0.00 23,479.02 100.00% ENERGY CONSERVATION - COMMERCIAL 0.00 37,809.12 0.00 76,425.58 100.00% PASNY CREDIT 0.00 (35,903.32) 0.00 (39,343.48) 100.00% TOTAL REVENUE 10,365,055.78 8,194,421.79 20,502,227.54 15,669,922.30 -23.57% (11) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF OPERATING REVENUE BY TOWN 8/31/09 TOTAL READING LYNNFIELD NO.READING WILMINGTON MONTH RESIDENTIAL 3,436,438.89 989,566.62 546,507.73 791,984.96 1,108,379.58 INDUS/MUNI BLDG 4,331,177.58 578,037.37 52,255.89 673,190.15 3,027,694.17 PUB.ST.LIGHTS 47,061.26 16,288.52 5,836.75 7,809.46 17,126.53 PRV.ST.LIGHTS 10,482.33 2,035.22 204.09 3,195.90 5,047.12 CO-OP RESALE 44,937.37 44,937.37 0.00 0.00 0.00 SCHOOL 111,513.74 44,191.00 22,480.00 12,337.26 32,505.48 TOTAL 7,981,611.17 1,675,056.10 627,284.46 1,488,517.73 4,190,752.88 THIS YEAR TO DATE RESIDENTIAL 6,234,551.81 1,827,943.22 1,004,192.08 1,366,603.12 2,035,813.39 INDUS/MONI BLDG 8,490,616.31 1, 124, 177.29 105,018.53 1,320,813.11 5,940,607.37 PUB.ST.LIGHTS 92,900.83 32,172.02 11,504.29 15,414.49 33,810.03 PRV.ST.LIGHTS 20,896.96 4,133.61 401.33 6,411.78 9,950.25 CO-OP RESALE 78,646.37 78,646.37 0.00 0.00 0.00 SCHOOL 232,753.10 91,849.96 50,208.20 27,888.72 62,806.22 TOTAL 15,150,365.38 3,158,922.47 1,171,324.41 2,737,131.23 8,082,987.27 LAST YEAR TO DATE RESIDENTIAL 8,062,036.60 2,539,530.07 1,212,353.53 1,840,441.90 2,469,711.10 INDUS/MUNI BLDG 11,662,633.09 1,619,314.15 200,795.84 2,042,837.46 7,799,685.64 PUB.ST.LIGHTS 105,998.38 37,522.34 13,130.35 17,299.39 38,046.30 PRV.ST.LIGHTS 24,675.69 4,670.08 481.24 7,970.53 11,553.84 CO-OP RESALE 119,055.13 119,055.13 0.00 0.00 0.00 SCHOOL 0.00 TOTAL 19,974,398.89 4,320,091.77 1,426,760.96 3,908,549.28 1~0 318, 996.88 PERCENTAGE OF OPERATING INCOME TO TOTAL TOTAL READING LYNNFIELD NO.READING WILMINGTON MONTH RESIDENTIAL 43.06% 12.40% 6185% 9.92% 13.89% INDUS/MUMI BLDG 54.26% 7.24% 0.65% 8.43% 37.94% PUB.ST.LIGHTS 0.59% 0.20% 0.07% 0.10% 0.229. PRV.ST.LIGHTS 0.13% 0.03% 0.00% 0.04% 0.06% CO-OP RESALE 0.56% 0.56% 0.00% 0.00% 0.00% SCHOOL 1.40% 0.5591. 0.28% 0.15% 0.42% TOTAL 100.00% 20.98% 7.8598 18.64% 52.53% THIS YEAR TO DATE RESIDENTIAL 41.15% 12.079' 6.63% 9.029. 13.43% INDUS/MUNI BLDG 56.04% 7.425. 0.69% 8.72% 39.21% PUB.ST.LIGHTS 0.61% 0.21% 0.08% 0.10% 0.229. PRV.ST.LIGHTS 0.14% 0.03% 0.00% 0.04% 0.07% C0-0P RESALE 0.52% 0.52% 0.005. 0.00% 0.00% SCHOOL 1.54% 0.61% 0.33 % 0.18% 0.42% TOTAL 100.00% 20.86% 7.73% 18.06% 53.35% LAST YEAR TO DATE RESIDENTIAL 40.36% 12.71% 6.07% 9.21% 12.379. INDUS/MUNI BLDG 58.399.. 8.115. 1.01% 10.23% 39.04% - PUB.ST.LIGHTS 0.53% 0.19% 0.07% 0.09% 0.18% PRV.ST.LIGHTS 0.12% 0.02% 0.00% 0.04% 0.06% CO-OP RESALE 0.60% 0.60% 0.00% 0.00% 0.00% SCHOOL 0.00% 0.00% 0.00% 0.0091. 0.00% TOTAL 100.00% 21. 63%. 7. 15% 19.57% 51.6551. (11A) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUDGETED REVENUE VARIANCE REPORT 8/31/09 SCHEDULE F ACTUAL BUDGET % YEAR TO DATE YEAR TO DATE VARIANCE * CHANGE SALES OF ELECTRICITY: RESIDENTIAL 3,220,864.33 3,385,227.00 (164,362.67) -4.86% COMM AND INDUSTRIAL SALES PRIVATE STREET LIGHTING 3,696,925.63 4,225,180.00 (528,254.37) -12.50% MUNICIPAL BUILDINGS PUBLIC STREET LIGHTING 62,541.44 86,069.00 (23,527.56) -27.34% SALES FOR RESALE 38,729.55 48,058.00 (9,328.45) -19.41% SCHOOL 113,510.14 141,752.00 (28,241.86) -19.929. TOTAL BASE SALES 7,132,571.09 7,886,286.00 (753,714.91) -9.56% TOTAL FUEL SALES 8,017,794.29 8,716,367.00 (698,572.71) -8.01% TOTAL OPERATING REVENUE 15,150,365.38 16,602,653.00 (1,452,287.62) -8.75% FORFEITED DISCOUNTS 129,284.88 173,499.00 (44,214.12) -25.48% PURCHASED POWER CAPACITY 329,710.92 600,000.00 (270,289.08) -45.05% ENERGY CONSERVATION - RESIDENTIAL 23,479.02 35,297.00 (11,817.98) -33.48% ENERGY CONSERVATION - COMMERCIAL 76,425.58 82,361.00 (5,935.42) -7.21% PASNY CREDIT (39,343.48) 0.00 (39,343.48) 100.00% TOTAL OPERATING REVENUES 15,669,922.30 17,493,810.00 (1,823,887.70) -10.43% * ( ) = ACTUAL UNDER BUDGET ( lls) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT SCHEDULE OF OPERATING EXPENSES 8/31/09 SCHEDULE E MONTH MONTH LAST YEAR CURRENT YEAR YTD OPERATION EXPENSES: LAST YEAR CURRENT YEAR TO DATE TO DATE CHANGE PURCHASED POWER BASE EXPENSE 2,213,208.36 2,680,493.12 4,522,612.83 4,946,373.91 9.37% OPERATION SUPER AND ENGIN-TRANS 0.00 0.00 0.00 0.00 0.00% OPERATION SUP AND ENGINEERING EXP 34,518.72 32,454.89 68,463.05 48,987.56 -28.45% STATION SUP LABOR AND MISC 8,121.15 375.58 15,805.71 751.16 -95.25% LINE MISC LABOR AND EXPENSE 52,764.42 55,933.48 103,556.98 106,942.56 3.27% STATION LABOR AND EXPENSE 40,297.01 42,493.56 79,157.21 74,311.39 -6.12% STREET LIGHTING EXPENSE 3,886.35 2,415.96 6,709.90 5,014.67 -25.26% METER EXPENSE 32,545.45 29,784.99 58,231.99 50,301.61 -13.62% MISC DISTRIBUTION EXPENSE 25,615.64 26,322.31 49,730.54 47,388.69 -4.71% METER READING LABOR & EXPENSE 6,486.18 7,032.40 15,067.07 16,868.05 11.95% ACCT & COLL LABOR & EXPENSE 133,205.20 129,745.86 242,047.29 214,713.98 -11.29% UNCOLLECTIBLE ACCOUNTS 10,400.00 12,500.00 20,800.00 25,000.00 20.19% ENERGY AUDIT EXPENSE 37,603.44 38,883.43 67,832.61 65,737.81 -3.09% ADMIN & GEN SALARIES 61,401.02 66,146.25 113,672.02 115,079.53 1.24% OFFICE SUPPLIES & EXPENSE 28,555.53 21,749.66 34,334.51 25,058.50 -27.02% OUTSIDE SERVICES 24,627.57 9,480.95 24,627.57 9,480.95 0.00% PROPERTY INSURANCE 26,282.19 31,019.91 52,564.38 62,039.82 18.03% INJURIES AND DAMAGES 4,510.67 3,059.64 10,440.08 6,123.29 -41.35% EMPLOYEES PENSIONS & BENEFITS 89,259.25 57,787.22 237,156.25 121,291.42 -48.86% MISC GENERAL EXPENSE 16,245.93 11,863.15 26,044.92 21,196.14 -18.62% RENT EXPENSE 14,246.71 13,968.28 27,692.34 27,413.91 -1.01% ENERGY CONSERVATION 0.00 17,035.60 0.00 31,816.20 100.00% TOTAL OPERATION EXPENSES 650 572.43 610 053.12 1,253,934.42 1,075,517.24 -14.23% rENANCE EXPENSES: MAINT OF TRANSMISSION PLANT 227.08 227.08 454.16 454.16 0.00% MAINT OF STRUCT AND EQUIPMT 38,361.04 7,763.22 62,225.77 3,322.05 -94.66% MAINT OF LINES - OH 110,340.77 71,031.97 151,699.28 100,789.75 -33.56% MAINT OF LINES - UG 10,467.35 12,706.69 25,054.18 13,747.66 -45.13% MAINT OF LINE TRANSFORMERS 17,068.69 3,740.30 17,068.69 10,836.94 -36.51% MAINT OF ST IT SIG SYSTEM. 22.83 (2.1.-89) (23.15). (68.80) 197.19% MAINT OF GARAGE AND STOCKROOM 73,481.13 48,912.75 95,946.31 77,921.52 -18.79% MAINT OF METERS 0.00 0.00 0.00 531.31 100.00% MAINT OF GEN PLANT 8,667.42 7,890.44 15,106.20 13,179.76 -12.75% TOTAL MAINTENANCE EXPENSES 258,636.31 152,250.56 367,531.44 220,714.35 -39.95% DEPRECIATION EXPENSE 261,200.00 280,105.78 522,400.00 560-,211.56 7.24% PURCHASED POWER FUEL EXPENSE 5,684,278.64 4,051,360.93 13,466,245.34 8,122,599.25 -39.689. VOLUNTARY PAYMENTS TO TOWNS 100,750.00 104,500.00 201,500.00 209,000.00 3.72% TOTAL OPERATING EXPENSES 9,168,645.74 7,878,763.51 20,334,224.03 15,134,416.31 -25.57% (12) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUDGETED OPERATING EXPENSE VARIANCE REPORT 8/31/09 SCHEDULE G ACTUAL BUDGET OPERATION EXPENSES: YEAR TO DATE YEAR TO DATE VARIANCE CHANGE PURCHASED POWER BASE EXPENSE 4,946,373.91 4,885,095.00 61,278.91 1.25% OPERATION SUPER AND ENGIN-TRANS 0.00 0.00 0.00 0.00% OPERATION SUP AND ENGINEERING EXP 48,987.56 69,750.00 (20,762.44) -29.77% STATION SUP LABOR AND MISC 751.16 10,434.00 (9,682.84) -92.80% LINE MISC LABOR AND EXPENSE 106,942.56 88,458.00 18,484.56 20.90% STATION LABOR AND EXPENSE 74,311.39 66,545.00 7,766.39 11.67% STREET LIGHTING EXPENSE 5,014.67 12,630.00 (7,615.33) -60.30% METER EXPENSE 50,301.61 65,399.00 (15,097.39) -23.09% MISC DISTRIBUTION EXPENSE 47,388.69 53,254.00 (5,865.31) -11.01% METER READING LABOR & EXPENSE 16,868.05 10,351.00 6,517.05 62.96% ACCT & COLL LABOR & EXPENSE 214,713.98 225,228.00 (10,514.02) -4.67% UNCOLLECTIBLE ACCOUNTS 25,000.00 25,000.00 0.00 0.00% ENERGY AUDIT EXPENSE 65,737.81 183,790.00 (118,052.19) -64..23% ADMIN & GEN SALARIES 115,079.53 117,890.00 (2,810.47) -2.38% OFFICE SUPPLIES & EXPENSE 25,058.50 44,161.00 (19,102.50) -43.26% OUTSIDE SERVICES 9,480.95 66,922.00 (57,441.05) -85.83% PROPERTY INSURANCE 62,039.82 73,862.00 (11,822.18) -16.01% INJURIES AND DAMAGES 6,123.29 10,382.00 (4,258.71) -41.02% EMPLOYEES PENSIONS & BENEFITS 121;291.42 217,085.00 (95,793.58) -44.13% MISC GENERAL EXPENSE 21,196.14 38,997.00 (17,800.86) -45.65% RENT EXPENSE 27,413.91 35,334.00 (7,920.09) -22.419o ENERGY CONSERVATION 31,816.20 0.00 31,816.20 100.00% TOTAL OPERATION EXPENSES 1,075,517.24 1,415,472.00 (339,954.76) -24.02% MAINTENANCE EXPENSES: MAINT OF TRANSMISSION PLANT MAINT OF STRUCT AND EQUIPMENT MAINT OF LINES - OH MAINT OF LINES - UG MINT OF LINE TRANSFORMERS MAINT OF ST LT & SIG SYSTEM MAINT OF. GARAGE AND STOCKROOM MAINT OF METERS MAINT OF GEN PLANT TOTAL MAINTENANCE EXPENSES DEPRECIATION EXPENSE PURCHASED POWER FUEL EXPENSE VOLUNTARY PAYMENTS TO TOWNS TOTAL OPERATING EXPENSES * ( ) = ACTUAL UNDER BUDGET 454.16 500.00 (45.84) 3,322.05 22,655.00 (19,332.95) 100,789.75 163,790.00 (63,000.25) 13,747.66 .23,850.00 (10,102.34) 10,836.94 19,334.00 (8,497.06) (68.80) 1,563.00 (1,631.80) 77,921.52 100,260.00 (22,338.48) 531.31 774.00 (242.69) 13,179.76 19,350.00 (6,170.24) 220,714.35 352,076.00 (131,361.65) 560,211.56 8,122,599.25 209,000.00 565,000.00 8,716,367.00 209,000.00 -9.17% -85.34% -38.46% -42.36% -43.95% -104.40% -22.28% -31.36% -31.89% -37.31% (4,788.44) -0.85% (593,767.75) -6.81% 0.00 0.00% -6.25% 15,134,416.31 16,143,010.00 (1,006,593.69) % (12A) TOWN OF READING, MASSACHUSETTS MUNICIPAL LIGHT DEPARTMENT BUDGETED OPERATING EXPENSE VARIANCE REPORT 8/31/09 OPERATION EXPENSES: PURCHASED POWER BASE EXPENSE RESPONSIBLE SENIOR MANAGER JP REMAINING 2010 ACTUAL BUDGET ANNUAL BUDGET YEAR TO DATE BALANCE 26,794,251.00 4,946,373.91 21,847,677.09 REMAINING BUDGET % 81.54% OPERATION SUPER AND ENGIN-TRANS KS 0.00 0.00 0.00 0.00% OPERATION SUP AND ENGINEERING EXP KS 398,196.00 48,987.56 349,208.44 87.70% STATION SUP LABOR AND MISC KS 71,651.00 751.16 70,899.84 98.95% LINE MISC LABOR AND EXPENSE KS 576,553.00 106,942.56 469,610.44 81.45% STATION LABOR AND EXPENSE KS 423,826.00 74,311.39 349,514.61 82.47% STREET LIGHTING EXPENSE KS 79,519.00 5,014.67 74,504.33 93.69% METER EXPENSE DA 424,973.00 50,301.61 374,671.39 88.16% MISC DISTRIBUTION EXPENSE JD 345,498.00 47,388.69 298,109.31 86.28% METER READING LABOR & EXPENSE DA 66,772.00 16,868.05 49,903.95 74.749. ACCT & COLL LABOR & EXPENSE RF 1,462,217.00 214,713.98 1,247,503.02 85.32% UNCOLLECTIBLE ACCOUNTS RF 150,000.00 25,000.00 125,000.00 83.33% ENERGY AUDIT EXPENSE JP 1,105,759.00 65,737.81 1,040,021.19 94.05% ADMIN & GEN SALARIES VC 776,201.00 115,079.53 661,121.47 85.17% OFFICE SUPPLIES & EXPENSE VC 264,600.00 25,058.50 239,541.50 90.53% OUTSIDE SERVICES VC 398,500.00 9,480.95 389,019.05 97.62% PROPERTY INSURANCE JD 443,150.00 62,039.82 381,110.18 86.00% INJURIES AND DAMAGES JD 60,039.00 6,123.29 53,915.71 89.80% EMPLOYEES PENSIONS & BENEFITS JD 1,093,185.00 121,291.42 971,893.58 88.90% MISC GENERAL EXPENSE VC 223,038.00 21,196.14 201,841.86 90.505'. RENT EXPENSE JD 212,000.00 27,413.91 184,586.09 87.07% ENERGY CONSERVATION JP 0.00 31,816.20 (31,816.20) 0.00% TOTAL OPERATION EXPENSES 8,575,677.00 1,075,517.24 7,500,159.76 87.46% INTENANCE EXPENSES: MAINT OF TRANSMISSION PLANT KS 3,000.00 454.16 2,545.84 84.86% MAINT OF STRUCT AND EQUIP14T KS 158,859.00 3,322.05 155,536.95 97.91% MAINT OF LINES - OH KS 1,060,849.00 100,789.75 960,059.25 90.50% MAINT OF LINES - UG KS 144,228.00 13,747.66 130,480.34 90.47% MAINT OF LINE TRANSFORMERS KS 93,500.00 10,836.94 82,663.06 88.41% MAINT OF ST LT & SIG SYSTEM JD 9,888.00 (68.80) 9,956.80 100.70% MAINT OF GARAGE AND STOCKROOM JD 625,632.00 77,921.52 547,710.48 87.55% MAINT OF METERS DA 4,863.00 531.31 4,331.69 89.07% MAINT OF GEN PLANT RF 116,100.00 13,179.76 102,920.24 88.65% TOTAL MAINTENANCE EXPENSES 2,216,919.00 220,714.35 1,996,204.65 90.04% DEPRECIATION EXPENSE RF 3,390,000.00 560,211.56 2,829,788:44 83.47% PURCHASED POWER FUEL EXPENSE JP 42,458,883.00 8,122,599.25 34,336,283.75 80.87% VOLUNTARY PAYMENTS TO TOWNS RF 1,254,000.00 209,000.00 1,045,000.00 83.33% TOTAL OPERATING EXPENSES 84,689,730.00 15,134,416.31 69,555,313.69 82.13% (12 L') 12:18 PM 9/25/2009 RMLD ENGINEERING AND OPERATIONS BUDGET VARIANCE REPORT FOR PERIOD ENDING AUGUST 31, 2009 ACTUAL BUDGET ACT/BUD YTD YTD VARIANCE E&O MGR 55 JUL AUG TOTAL TOTAL % 01-55-5920-101 LABOR REG 12,834 14,016 .26,850 26,959 -0.41% 01-55-5920-102 LABOR OT 0 0 0 500 -100.00% 01-55-5921-000 OFFICE SUPPLIES 0 0 0 166 -100.00% 01-55-5930-103 EE EDUCATION 0 0 0 3,550 -100.00% 01-55-5930-106 VEHICLE (561) (314) (875) 888 -198.59% 01-55-5923-000 OUTSIDE SERVICES 0 1,031 1,031 1,666 -38.10% 01-55-5930-105 MISC GENERAL 0 0 0 200 -100.00% SUB-TOTAL 12,273 14,733 27,006 33,929 -20.41% ENGINEERING 65 01-65-5580-101 LABOR REG 13,356 30,128 43,484 46,579 -6.64% 01-65-5580-102 LABOR OT 3,502 2,441 5,943 7,950 -25.25% 01-65-5580-103 EE EDUCATION 0 0 0 13,500 -100.00% 01-65-5580-105 SUPPLIES 125 137 262 834 -68.56% 01-65-5580-106 VEHICLE (450) (252) (702) 888 -179.0696 01-65-5921-000 OFFICE SUPPLIES 9 205 213 166 28.54% 01-65-5923-000 OUTSIDE SERVICES 0 877 877 3,750 -76.62% SUB-TOTAL 16,541 33,536 50,078 73,667 -32.02% LINE 66 01-66-5568-109 MAINT OF TRANS EXP 227 227 454 500 -9.17% 01-66-5581-101 LABOR MISC 46,688 52,011 98,699 57,123 72.7891. 01-66-5581-109 GENERAL EXP 4,321 3,923 8,244 20,834 -60.43% 01-66-5581-103 EE EDUCATION 0 0 0 10,500 -100.00% 01-66-5585-109 STREET LIGHT EXP 630 907 1,537 3,334 -53.90% 01-66-5585-101 LABOR REG ST LIGHT 1,261 1,008 2,269 2,856 -20.54% 01-66-5585-102 LABOR OT ST LIGHT 444 129 573 2,000 -71.37% 01-66-5585-106 VEHICLE ST LIGHT 264 372 636 4,439 -85.689. 01-66-5593-000 MAINT OF LINES 1,288 (799) 489 8,000 -93.89% 01-66-5593-101 LABOR REG MAINT LINE (630) 28,783 28,152 44,353 -36.53% 01-66-5593-102 LABOR OT MAINT LINE 27,098 21,697 48,795 40,120 21.62% 01-66-5593-106 VEHICLE MAINT OR LINE (4,824) 2,615 (2,209) 30,186 -107.32% 01-78-5593-110 TREE TRIMMING 6,625 18,737 25,563 41,130 -37.85% 01-66-5594-109 MAINT UG LINE 1,602 12,307 13,909 19,294 -27.91% 01-66-5594-101 LABOR REG UG LINES 0 349 349 2,141 -83.70% 01-66-5594-102 LABOR OT UG LINE 0 199 199 834 -76.199. 01-66-5594-106 VEHICLE UG LINE (561) (148) (709) 1,582 -144.81% 01-66-5596-109 ST LT & SIG EXP 0 0 0 84 -100.00% 01-66-5596-101 LABOR REG ST LT/SG 0 0 0 951 -100.0098 01-66-5596-102 LABOR OT ST LT/SG 0 0 0 84 -100.00% 01-66-5596-106 VEHICLE ST LT/SG (47) (22) (69) 444 -115.50% 01-66-5921-000 OFFICE SUPPLIES 0 0 0 84 -100.00% SUB-TOTAL 84,587 142,293 226,880 290,874 -22.00% Page 1