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HomeMy WebLinkAbout2002-07-08 RMLD Board of Commissioners MinutesV Reading Municipal Light Board of Commissioners Regular Session 230 Ash Street Reading, MA 01867 July 8, 2002 rr) Start Time of Regular Session: 7:35 p.m. ~ C') > CD End Time of Regular Session: 10:10 P.M. c 3 Attendees: 3 C rnrn Commissioners: Messrs. Hughes, Pacino, Ames, Soli, and Herlihy 2>~ C3 RMLD Staff: Mr. Cameron, Acting General Manager, Messrs. Blomley and Fournier ii Mses. Antonio and Gottwald Guests: Messrs. Gehret and Bartlett, former Citizen's Advisory Board Members This meeting is being video taped for distribution to the community television stations in North Readi ng, Wilmington and Lynnfield. Tapes of this meeting can be purchased from RCTV. Chairman Hughes, Chairman of the Board, called the meeting to order at 7:35 p.m. RMLD Board of Commissioners Subcommittee Meetings Commissioner Hughes pointed out the Public Relations Subcommittee met prior to the RMLD Board of Commissioner's meeting at 7:00 p.m. in the Audio Visual/Spurr Room and the Pension/Audit Subcommittee met at 6:45 p.m. in the Residenti al and Commercial Conference Room. Meter Lamp Presentations Commissioner Hughes described the tradition of Meter Lamp presentations. Mr. Hughes stated these meter lamps are presented to those who have served within the RMLD on various boards, committees, etc. Mr. Hughes expressed his honor at this time to present meter lamps to two well deserving members, Hartnell Bartlett from North Reading and Joe Gehret from Lynnfield. Mr. Hughes thanked both members for the years of service they provided to the Citizen's Advisory Board (CAB). Mr. Pacino thanked Hartnell Bartlett for his many years of service as the Chairman of the CAB stating he was very instrumental and his dedication and input will be missed. Mr. Cameron acknowledged Joe Gehret for his efforts on behalf of the Town of Lynnfield, stating Mr. Gehert did a great job representing the Town during his tenure on the CAB. Report of the Chairman of the Board Motions from the Citizen's Advisory Board, correspondence dated June 12, 2002 Commissioner Hughes read the revised motion to approve Purchase Power Charges as recommended by the CAB: "Move that the CAB reconfirm their original motion to approve the Purchase Power Adjustment Charges as presented and recommended by the Acting General Manager." Mr. Cameron explained he made a presentation on April 30`x' suggesting the PPA Charge include, not only changes in our present expense structure, but also to refund money from the RSF of approximately $250,000 per month. Mr. Cameron further stated the CAB had recommended the PPA Charge go forward, however, the Commission came back with a different motion to bring back to the CAB. The motion was changed so the refunds from the Rate Stabilization be done in a one time refund in August, 2002, based on a ratio of the amount of money charged each customer between July, 2002 and August, 2001 in relation to the total amount of money charged. The CAB came back and stated they recommend the PPA charge as presented originally. At this point, Mr. Soli suggested reviewing the previous meeting minutes, as he believed there was an amended vote in the minutes that could clarify this issue. Mr. Cameron explained Mr. Soli had two motions at the April 30`h meeting, one was for a Cost of Service study be done on the rates exactly as the rates are structured now and the second motion was a one time refund be done in August, 2002. As Mr. Cameron continued to explain at that time, he was instructed to bring the motion back to the CAB so they could review it and come back with a recommendation. Regular Session Minutes July 8, 2002 Report of the Chairman of the Board Mr. Cameron wanted to make sure the motions were correct stating he discussed the motion with Commissioners Ames and Soli and brought the motions to the CAB. The CAB came back with the first two recommendations voted upon at their CAB meeting on June 4"'. Mr. Soli stated in the April 30`1' minutes, Mr. Pacino amended the motion and it was seconded to read "the PPA Charge with respect to the base power cost..." further stating the vote carried 5:0:0. Mr. Cameron reminded the Commission there was a second part of the PPA which is the rate stabilization part that did not get approved, one motion was split into two motions and one of them was that the Cost of Service study be done and the second one was a one time refund be done in August. Both motions were given to Mr. Cameron and he was instructed to go back to the CAB. Basically, the CAB is reconfirming the motion they made originally and they believe not only the PPA charge should have the base expense differential but also the RSF, as Mr. Cameron presented at the April 30th meeting. Mr. Pacino suggested the CAB should have been more specific, with an explanation because it is not clear what they approved. Lengthy discussion ensued. Commissioner Hughes suggested moving forward in the agenda to review the minutes for possible clarification on this issue then return to this agenda item. Minutes April 30, 2002 Mr. Ames noted an incorrect phrase at the beginning of minutes which states, "This meeting is being video taped, as a public record, for distribution...", it should read, "This meeting is being video taped for distribution...." deleting "as a public record." As Mr. Ames explained, the videotape is not a public record because the Commission does not approve it. Mr. Ames also noted a correction to the minutes of April 30, 2002 on page five, fourth paragraph, first sentence. He stated the sentence is incorrect as it reads, "Mr. Ames pointed out in 1992-1993...." stating it should read, "Mr. Ames noted for the Point LePreau contracts the base rate...." Mr. Pacino made a motion seconded by Mr. Ames to approve the minutes of April 30, 2002 with the two changes noted above. Motion carried 4:0:1, Mr. Soli abstained, as he was not in attendance at the April 30, 2002 meeting. May 13, 2002 Mr. Pacino made a motion seconded by Mr. Ames to approve the minutes of May 13, 2002 with the phrase "as a public record" deleted from the first sentence. Motion carried 5:0:0. May 28, 2002 Mr. Pacino made a motion seconded by Mr. Ames to approve the minutes of May 28, 2002 with the phrase "as a public record" deleted from the first sentence. Motion carried 5:0:0. June 4, 2002 Mr. Pacino made a motion seconded by Mr. Soli to approve the minutes of June 4, 2002 with the phrase "as a public record" deleted from the first sentence. Motion carried 4:0:1. Mr. Ames abstained, as he was not in attendance on June 4, 2002. June 12, 2002 Mr. Pacino made a motion seconded by Mr. Ames to approve the minutes of June 12, 2002 with the phrase "as a public record" deleted from the first sentence. Motion carried 5:0:0. Mr. Pacino informed the Board he plans to depend more on the Department to write the minutes and will re-write them only at a minimum. After reviewing the minutes, there was still no clear decision on the motion to approve the Purchase Power Charges. Regular Session Minutes July 8, 2002 Report of the Chairman of the Board Mr. Pacino suggested the Rate Subcommittee and the CAB meet jointly and bring recommendations back to the Commission at the next Board meeting on August 12, 2002. Mr. Cameron will check into the possibility of a joint meeting with the Rate Subcommittee and CAB. Motion to table the Cost of Service Study Mr. Hughes read the following three motions by the CAB: "Move that the second suggested motion under Item 4 on the agenda relative to a Cost of Service Study be tabled until the next scheduled CAB meeting." Motion to recommend reimbursement to the Town of Reading "Move to recommend to the RMLD Board the reimbursement to the Town of Reading for the cost of the Task Force Audit." Motion to approve Chairman of CAB to appoint member to serve on General Manager's Search Committee "Move that the Chairman of the CAB be authorized to appoint a member to serve on the General Manager's Search Committee. Mr. Pacino stated all these motions were previously approved by the RMLD Board of Commissioners. Mr. Hughes explained the General Manager Search Committee is meeting on Wednesday evening July 10 h at 6:00 p.m. at RMLD, 230 Ash Street, in the AN Spurr Board Room and has been posted. Mr. Hughes informed the Commission that in addition to himself, Mr. Pacino is on the Committee along with Beth-Ellen Antonio, RMLD Human Resource Manager, Beth Klepeis, Town Treasurer, Timothy McCarthy, Manager form Belmont Light Department, Bill Wallace, Manager Wakefield Light and Fred Numergut, former RMLD Board of Commissioner and an expert in the power industry, the CAB will be represented by Arthur Carakatsane. Mr. Ames stated he did not see a motion creating the General Manager Search Committee and suggested a motion be made and voted upon. Mr. Pacino made a motion and seconded by Mr. Ames that the Commission officially form a General Manager's Search Committee with members to be designated by the Chairman. Motion carried 5:0:0. Community Support through Reading Municipal Light Department Financial Donations Mr. Hughes reiterated that the Public Relations (PR) Subcommittee met earlier this evening and is comprised of himself and Commissioner Herlihy stating they met with the Community Relations Manager, Priscilla Gottwald. The subcommittee reviewed five applications from different communities within the service area who were soliciting financial assistance in accomplishing some of the projects within their community. Mr. Hughes explained there is a regular form the Town who is requesting this money completes and submits to the Community Relations Manager, further stating stated three or four years ago the Department allocated $7,500 to each of the four service communities for this purpose. Mr. Herlihy stated the PR Subcommittee met on several items. Mr. Herlihy also stated this is a controversial topic, he has concerns about the way the Public Relations money is spent and believes the Department is spending the wrong amount. Mr. Herlihy believes the Department should either spend nothing or spend enough to make a difference. Although the Department has a fine Public Relations staff, it is facing a lot of serious problems out there right now. One suggestion could be to look at what other agencies do in terms of public relations suggesting either this money buys us a great deal or it gets us nothing. Mr. Herlihy stated when done correctly it can really help promote the Department and considering the RMLD has been kicked around a little bit this money can help if it is put into the right places. Mr. Hughes asked if there is any further discussion on this issue. Mr. Ames observed prior to the events leading up to 85-121, RMLD had no Public Relations budget and part of what happened as a result of those circumstances, basically the loss of twenty percent of the customer base and the realization many people being served by RMLD had no idea what RMLD was about, they thought of it as any other utility. The recommendation strongly was . . made at the time to initiate a Public Relations campaign so at least the customers would know who the utility was, what it did and how well it did it and since then there has been public relations. Regular Session Minutes July 8, 2002 4 Community Support through Reading Municipal Light Department Financial Donations RMLD is also the only electric utility that has the majority of its service area outside of its own community therefore the RMLD is the only utility that has a need for a public relation campaign. In all the other municipal utilities the consumers are the owners and they are captive, they either like it or they do not. In the case of Wilmington, North Reading and Lynnfield Center, they have choices and RMLD would like to see those Towns continue to choose RMLD thereby creating the need for a Public Relations budget and expenditures. Mr. Pacino stated he is aware of at least two other municipal utilities with a public relations budget Holyoke and Braintree. Mr. Pacino stated the PR budgets do exist basically for the same reason Mr. Ames expressed. Mr. Pacino noted when the Commission went to Wilmington they saw the need for public relations. Mr. Herlihy offered to review this when we formulate our next budget. Mr. Cameron noted he would like to see this issue put to rest prior to the next budget time due to the payables. Discussion ensued. Ms. Gottwald informed the Commission of the three donations that were approved by the subcommittee: 1) Austin Prep Golf Tournament in the amount of $150 for a Tee stating employees would not be playing golf, this is a sign that goes up at the tee in recognition of RMLD. 2) Coolidge Middle School Olympiad was approved for $500. 3) A press box for the North Reading High School for $500. Mr. Ames pointed out the Department should always be referred to as the Reading Municipal Light Department, not Reading Municipal Light Company as is written in the Ipswich Park summer series brochure. Reimbursement for vandalism Commissioner Hughes' vehicle Mr. Hughes explained the damage to his vehicle that occurred during the last RMLD Board meeting on June 12, 2002 and stated the RMLD's insurance company stated the damage would not be covered. Mr. Ames stated he believes it is very important that unpaid Commissioners not be subject to financial cost or damage as a result of their participation whether it be damage to a car mirror, legal costs, etc. and it should be set as precedence. Mr. Herlihy made a motion seconded by Mr. Ames to approve RMLD reimburse Commissioner Hughes for the vandalism to his vehicle. Motion carried 4:0:1, Mr. Hughes abstained. Action Items Management Letter, Nelson, Adam & Dickson, P.C. As a result of the Task Force, the Subcommittee agreed to review the changes in the policies prior to their resubmission and the plan was to bring it back to the Board. Mr. Ames questioned if the Board wants the policies to go back to them or do they want to refer it to the Subcommittee? Mr. Pacino stated the intent was to bring it back to the Subcommittee. Mr. Ames noted Nelson, Adam and Dickson were not aware of any activities they were acting on what they saw. Mr. Ames further noted the Subcommittee asked the Accounting Department in the future to direct the auditors to extend their sampling of the audit into the travel education account and the events that led up the Inspector General's report will not happen again, or less likely to happen. In reviewing the RMLD Board of Commissioners Subcommittees, Mr. Cameron asked the Commission if there is a specific Policy Committee. Mr. Ames stated there was no Policy Committee. Mr. Cameron then asked whom would the policies go back to? Mr. Ames stated the policies would go back to the Task Force Subcommittee (himself and Mr. Herlihy). Regular Session Minutes July 8, 2002 Action Items Mr. Pacino made a motion seconded by Mr. Ames to approve the RMLD Board of Commissioners accept the 2001 Management Letter from Nelson, Adam & Dickson, P.C., along with the Department's responses based on the recommendation of the Audit Subcommittee. Motion carried 5:0:0. Pension Trust Mr. Ames explained this is the extrapolation year but any subsequent discrepancies will be caught at the next evaluation and there will be no long-standing problems. Mr. Soli asked if this was a one time per year. Mr. Pacino replied, "once a year." Discussion ensued a question and answer period. Mr. Pacino made a motion seconded by Mr. Ames to approve the RMLD Board of Commissioners contribute $181,165.00 into the RMLD Pension Trust for year 2002 based upon the calculation from the January 1, 2001, Pension Trust Actuarial Valuation by Stone Consulting, Inc., on the recommendation of the Pension Trust Subcommittee. Motion carried 5:0:0. Citizens' Advisory Board, Selectmen Liaison and Customer Comments As a personal point of privledge, Mr. Hughes stated he has a problem with the article that was in the local newspaper recently relative to the RMLD Oversight Task Force to remain in effect. As Mr. Hughes stated, RMLD Board of Commissioners has two members of the Board who sit on the Task Force and the town also has an Ad Hoc Committee that is studied the Department. Mr. Hughes questioned the need for the Task Force to continue. Mr. Ames stated the Commission has input on the Task Force, he is reluctant to see the Task Force terminated because it is the only way where the RMLD Board of Commissioners has any input so it seems appropriate to him to have it in place. Mr. Hughes asked what is the duration of the Task Force? Mr. Ames answered the Task Force plans to meet at least once more before the end of the year, perhaps after the Ad Hoc Committee is done. Relative to the Ad Hoc Committee, Mr. Pacino observed he has been getting stopped by a lot of people who are absolutely opposed to this Ad Hoc Committee stating the townspeople's opinion is that the Selectmen are going down the wrong path and the Selectmen should be concentrating on getting the sale of the dump complete not look at what the Light Department is doing. Mr. Pacino stated his is amazed because in the past not a very lot of people have communicated to him over the years, however he is now getting stopped by quite a lot of people. Mr. Pacino stated he does not mean for this to be a criticism to the Selectmen, he is just communicating what the public has communicated to him. Mr. Hughes added to Mr. Pacino's statement informing the Commission while he was on vacation, he ran into a few individuals from Reading he didn't even know at a coffee shop and these individuals asked him what the RMLD Board of Commissioners are doing in allowing an Ad Hoc Committee to oversee a finely run Department and agreed that while the Department did have a few kinks, the kinks have been addressed. Mr. Hughes' opinion is that the Town has no problem with the Task Force Committee but the Ad Hoc Committee is pushing the issue. Mr. Herlihy commented the Task Force is basically asleep for now and can come out of hibernation, if needed, however Mr. Herlihy believes it would not be in the best interest for RMLD to dismantle this body only to possibly have to reorganize it at a later date. Discussion ensued. Acting General Manager's Report Inspector General Request Letter, June 61 2002 Mr. Cameron updated the Commission on the events relative to the Inspector General (IG) Request letter received by the Department dated June 6, 2002. Mr. Cameron stated this was a request for information referring to contracting practices with consultants for energy related services, Mr. Cameron pointed out the IG's Office wanted all this information back within one week from receiving the letter. Regular Session Minutes July 8, 2002 Acting General Manager's Report Inspector General Request Letter, June 6, 2002 Mr. Cameron informed the Commission he sent a letter back to the IG requesting an extension until July 8, 2002 and indeed delivered the information to the IG's office this afternoon, July 8, 2002. Mr. Cameron stated there is still a lot of information relative to the North Reading Substation which is voluminous, consisting of thirty boxes full of information, so he invited the IG to come down and view the boxes themselves noting if they found any pertinent information the Department would be happy to make copies. Mr. Hughes replied if Mr. Cameron was at liberty to discuss anything he may have received from Rubin and Rudman concerning the previous IG Report. Mr. Cameron replied he received a letter just this today from the Secretary of State's office announcing that the Choate, Hall, Stewart Report is, as the RMLD previously stated, a protected document under the public records law. The Secretary of State's letter stated they agree with the Department, the report is a protected document with the exception of Section II that is not protected due to information relating to discrimination laws. Mr. Cameron stated he will give copies to the Commissioners. Discussion ensued. Mr. Hughes stated he is very impressed with the relationship the RMLD has established with the IG's Office during this re- establishment, communicating with them cooperatively and unchallenging. Mr. Hughes complimented the staff and the Department as a whole for the extended working hours put in again on weekends, etc. to accommodate the deadline of the IG's Office. ENE Financial Report, April, 2002 Mr. Cameron noted at the request of the Board he will include the monthly management reports from ENE in the Acting General Manger's report. Mr. Ames asked if Mr. Cameron was now sitting on the Board of ENE. Mr. Cameron replied, yes, he is sitting on the Board further stating ENE had a year-to-date loss $87,000 budget, their budget was $67,000 leaving them with a net loss of $20,000 over and above their budget - they have a total loss of $60,000 in April. Discussion ensued with a question and answer period RMLD Board of Commissioners meeting in outside towns Mr. Hughes announced the Acting General Manager, Mr. Cameron, discussed this issue in depth with the Town Manager, Mr. Hechenbleikner who in turn referred it to Town Counsel. Mr. Cameron distributed an e-mail he received from Mr. Hechenbleikner, the Town Manager, on June 13, 2002. As Mr. Cameron explained, Mr. Heckenbleikner received a letter from Joan Langston, the attorney for the Town and basically what Mr. Heckenbleikner suggests is the RMLD Board of Commissioners hold outreach meetings in the other three communities, however, not business meetings. According to Mr. Cameron this is a gray area and he reiterated the fact he is trying to keep the legal costs down and is not sure how much could be spent pursuing this issue. Mr. Pacino stated the intent of meeting in other communities is to get out to hear what the ratepayers have to say stating not to necessarily conduct a business meeting, but rather a presentation meeting since no voting or action can be taken. Mr. Herlihy once again mentioned his intent is not to drive up legal cost or researching costs, it is a suggestion to give the other communities an opportunity to voice some of their concerns and for the Commission to explain some of the real changes and positive implementations. Mr. Herlihy reiterated he has some real PR concerns about the RMLD since there have been stories in the newspaper, etc. Therefore, we should ensure they are getting the positive messages now. Mr. Pacino agreed with Mr. Herlihy's point it is important to create a positive image and suggested having an outside meeting in Wilmington in September without any taking any actions and returning to RMLD to finish regular business. Mr. Cameron stated he would like to address this issue with the CAB and have them investigate what their Towns would like to see in form of a meeting with the Board. Mr. Cameron will poll the CAB separately and return back to the Board on this issue. Mr. Pacino again stated he would like to see a target date of September to hold in one of the outside towns. Regular Session Minutes July 8, 2002 RMLD Financials - May 2002 Mr. Cameron stated on a monthly basis, Mr. Fournier, the Accounting Manager do a brief overview and any questions the Commission has will be answered but we will not go into a lot of depth. At that point, Mr. Fournier began a brief presentation highlighting some major points within the financials. An informative presentation continued as Mr. Fournier answered questions and accepted recommendations from the Commissioners. NEPPA Annual Conference Mr. Hughes reminded the Commission the deadline for the NEPPA Annual Conference registration is July 18, 2002. Mr. Cameron stated the only Commissioner we have not heard from is Commissioner Soli. Mr. Soli stated he would not be attending. Mr. Herlihy stated he would clarify his attendance by the end of this week. Board Discussion Updated list of Board of Commissioners Subcommittees Mr. Herlihy noted the RMLD Board of Commissioners does not have any type of environmental affairs/alternative energy type committee and he suggested one be put into place to show this is an important issue at Department to deal with all the green issues. Mr. Herlihy stated it could be a very broad committee, looking at the Department's environmental practices in general, looking at buying green where available. Mr. Herlihy stated he has gotten comments from people relative to environmental energy and believes the Department should examine possibilities. Mr. Cameron replied he has no problem with the idea of an environmental committee, however, he informed the Commission of a presentation RMLD had done last year at the request of Mr. Quincy Vale from Wilmington who is active in green power. Mr. Cameron stated the presentation was for green power activity in the Northeast and green power is not as prevalent in the Northeast as it is in other parts of the country. Given this information, Mr. Cameron suggested resurrecting this issue and stated a committee would probably be a good idea. Discussion ensued. Rate Comparisons June 2002 Mr. Cameron stated the Rate Comparisons are very similar to the presentation he gave to the Board last month. Mr. Cameron explained the PPA Charge is actually annualized rates. Mr. Cameron pointed out some detailed facts about the rate comparisons continuing with a brief question and answer period. General Manager's Contract Mr. Ames stated the GM Contract was discussed at the Task Force meeting where Messrs. Ames and Herlihy committed to adding this item to the next RMLD Board Meeting. Discussion ensued relative to the previous GM Contract and whether a contract benefits or hinders the Department. Mr. Hughes suggested deferring this issue to the GM Search Subcommittee. Examining possibility of rate class for schools Mr. Herlihy pointed out the schools are facing serious budget constraints right now and suggested as part of improving the Department's public relations and to give something back to the Town possibly setting up a special rate classification for the public schools and libraries. Mr. Herlihy stated he spoke with a building supervisor noting North Reading spent $160,000 on their schools' electric bills, the school system represent some of the Department's largest customers and if we could set up a rate classification saving the school 10% off that bill, the school would have an extra $16,000 to hire a much needed reading specialist, etc. The school system always need extra money and would find a way to spend that money, as they are having terrible override battles over school funding, the Department could do nothing better to benefit the Towns. Mr. Herlihy stated this is the kind of expense that business and commercial enterprises would be willing to accept. Mr. Pacino agreed this idea is very noble and at one point the Board considered giving the churches specialized rates, however, he stated if one group gets a discount, another group must pay extra. F.egular Session Minutes July 8, 2002 Examining possibility of rate class for schools Mr. Pacino pointed out the 85-121 discusses rate discrimination that was brought on by a business group. Mr. Pacino further pointed out a business in Wilmington may not want to support giving a discount to the North Reading schools. Mr. Herlihy agreed this is a hot political issue, however, on the flip side, businesses demand more from the educational system in terms of training better workers and offer better products so future businesses could benefit in the long run. Mr. Ames commented he would like to help, however, he strongly suggests getting a fully qualified cost of service in place so the Board could look at how the cost breakdowns for schools. Mr. Ames agreed the schools are probably being overcharged, they do not use air conditioning, they do not use a lot during the peak weather periods, they are very good customers for RMLD because they are using electricity when most other people are not using electricity. Mr. Pacino suggested discussing with the CAB because they will ultimately have to approve this issue. Mr. Cameron informed the Commission the RMLD cannot stray from,the rates that are in place right now and the schools do not use a lot of electricity in the summer and are able to take advantage of the lower winter rates. Mr. Soli agreed with Mr. Ames point of view stating the school systems are good customers because during the heat they are not using a lot of electricity and are consistent in the winter. Mr. Cameron stated he will examine the unit cost for the four towns and get back to the Commission. Next Meeting Date The next RMLD Board of Commissioners meeting is scheduled for Monday, August 12'h at 7:30 p.m. Motion to Adjourn At 10:10 p.m., Mr. Pacino made a motion seconded by Mr. Ames to adjourn the Regular Session. Motion carried by a show of hands 5:0:0. A true copy of the RMLD Board of Commissioners minutes as approved by a majority of the Commission. Mr. Philip B. Pacino Secretary, RMLD Board of Commissioners