HomeMy WebLinkAboutMINUTES Light and Power Committee 2003-01-09RECORD OF PROCEEDINGS
1Town of Estes Park,Larimer County,Colorado,January 9,2003
Minutes of a Regular meeting of the LIGHT &POWER COMMITTEE of the
Town of Estes Park,Larimer County,Colorado.Meeting held in the
Municipal Building in said Town of Estes Park on the gth day of January,
2003.
Committee:Chairman Jeffrey-Clark,Trustees Gillette and Newsom
Attending:Chairman Jeffrey-Clark and Trustee Gillette
Also Attending:Town Administrator Widmer,Assistant Town Administrator Repola,
Light and Power Director Matzke,Town Attorney White,Finance
Officer Brandjord,Town Clerk O’Connor
Absent:Trustee Newsom
Chairman Jeffrey-Clark called the meeting to order at 8:00 a.m.
TEN-YEAR FINANCIAL FORECAST —PRESENTATION.
The Committee reviewed a 10-Year Financial Forecast (long-term planning tool)as
prepared by Max Kiburz/Kiburz &Associates (Rate Consultant).In summary,Mr.
Kiburz stated that the forecast was based on the following assumptions:
•Growth in electric sales is forecast by growing the number of customers in each
rate class;average use/customer is assumed to remain constant.
•Rate increases recommended by the 2002 Electric Rate Study will be
implemented in 2003 and 2004.
•PRPA’s wholesale rate will increase by 4%beginning in 2004.
•Operation and maintenance expenses are expected to increase 2%/yr.
•Excluding large capital projects recommended by the Long Range Plan,capital
expenses are forecast based upon historical trends.
Graphs for financial detail,sales projections,revenues,operating expenses,PRPA
purchased power costs,capital improvements and interest income were presented.
In summary,the financial forecast indicates that a rate study update should be
performed during 2004 to facilitate a rate recommendation for early 2005.Staff is
recommending the following financial goals be adopted:
1.Balance revenue and expenses by year end 2005.
2.Fund capital expenditures from operating revenues through 2010.
3.Establish a target for fund balance (excluding inventory)of 25%of operating
revenues.This target should be achieved by year 2012.
Assistant Town Administrator Repola reported that Mr.Kiburz has provided a computer
program that will allow staff to perform theoretical exercises that will in turn assist staff
in updating the financial forecast model every year.Discussion followed on a rate
increase v.an added-on surcharge,and staffs assurance that any future rate increases
could be spread-out over a period of time in lieu of a substantial one-time increase.
The Committee requested staff comment on this item during the public hearing
scheduled January 14th The Committee recommends approval of the three
financial goals as specified above,and Light and Power staff,Mr.Kirbuz,etal
received kudos in responding to and working on this project.
RECORD OF PROCEEDINGS
Light and Power Committee —January 9,2003 -Page 2
OPERATION OF CABLE PUBLIC ACCESS CHANNEL 39—DISCUSSION.
Town Administrator Widmer provided background information on the franchise
agreement between Charter Communications and the Town.In summary,the
agreement provides that the cable operator must provide certain hours of community
programming.Traditionally,this service has been provided by Nick Mollé
Productions/Channel 8.The Town has been approached by Curt &Cathy
Gunther/Airbits,on the possibility of operating Ch.39 (a public access channel)as a
community television station.
Town Attorney White reviewed a 1993-94 lawsuit where a citizen sued Charter
Communications and the Town for public access.The suit was settled with Charter
agreeing to provide public access for 2-hrs./week,Monday-Friday on Channel 39.The
Town Board adopted Resolution 15-94 approving the Settlement Agreement and
conditions of operating Channel 39 for public access.In Attorney White’s opinion,the
Town would have an opportunity under the Agreement to proceed.
Ms.Gunther reported that Charter is in favor of their concept:“a 24-hr.,local,daily,
changing programming”,that could include daily news,and information/involvement
from the schools,senior citizens,etc.
Administrator Widmer suggested that it would be in everyone’s best interest to consider
an RFP process.The Committee recommends staff proceed in preparing an REP
to lease Channel 39 for community and public access.
Trustee Gillette departed the meeting at 8:40 a.m.
POLICY MANUAL AMENDMENT PERTAINING TO INTEREST RATE ON ELECTRIC
DEPOSITS -APPROVAL.
In accordance with the Utility Deposit Policy contained in the Light and Power
Department Policy Manual,the Town requires utility deposits for certain residential and
commercial customers.Said Policy references the interest rate established by the
Public Utilities Commission (PUC)as the interest rate to be paid by the Town on utility
deposits.PUC has traditionally set the interest rate to be paid on deposits based on the
average monthly rate in the secondary market for one-year U.S.Treasury Bills.
The Federal Reserve no longer reports on the secondary market for one-year Treasury
Bills and the PUC has not established a new standard,and are continuing to use the
2002 rate of 4.32%until a rulemaking process can be completed.
The current interest rate earned by the Town for short-term investments is 1.85%;the
current 2-yr.Treasury Bill rate is 1.7%.Based on customer deposits of approximately
$150,000,the recommended change will reduce interest paid on deposits in 2003 by
approximately $4,000.
Staff is recommending the Policy be amended to read as follows:
Electric Utility Deposit Policy,Paragraph (d):All cash deposits retained by the
Town will accrue interest at the rate set by the Town’s Finance Officer.The rate
will be adjusted as of January 1st of each year to reflect the current market rate
earned on Town investments.The 2-year Treasury Bill rate will be used as a
benchmark.Accrued interest will be disbursed when the deposit is refunded to
the customer.
Attorney White confirmed that the Town would not be placed in jeopardy as long as both
inside and outside customers are treated in the same manner.The Committee
recommends approval of the Policy Manual amendment as presented.
RECORD OF PROCEEDINGS
Light and Power Committee —January 9,2003 -Page 3
OWNERSHIP OF DISTRIBUTION FACILITIES —DISCUSSION.
The Committee reviewed a summary of the ownership of the following distribution
system facilities:
Substation Facilities.Under the Wholesale Power Contract with PRPA,the
Town is to furnish the substation site and improvements,including grading,
surfacing,access road,fencing,control building,and AC and DC service.
Both of the Town’s substations are located on BOR property under a Special
Use Permit.PRPA is to install,own,and maintain switching and protective
equipment of adequate design and sufficient capacity to deliver service to the
Town’s system at 115,000 volts.The Town is to install,own,and maintain
the necessary substation equipment to take delivery of this service.
•Distribution Facilities.The Town owns all distribution lines within its service
area.The service area is certified by the PUC,and distribution lines are
located in public rights-of-way or easements.
•Service Facilities.Ownership of service facilities is detailed in the Light and
Power Policy Manual.New customers pay all costs to extend the town’s
distribution system to the customer’s point of service.In general,the Town
installs,owns and maintains all transformers required to deliver service at the
standard secondary voltages.
Service facilities are owned and maintained by the Town up to the point of
service.There are situations (when a transformer is located on private
property and serves only a single customer)where ownership of the
transformer could be transferred to the property owner.This would reduce
the Town’s plant investment if implemented on a large scale.Customers
would also be exposed to potentially prohibitive repair or replacement costs
and may not necessarily eliminate the Town’s exposure to nuisance lawsuits.
Attorney White provided background information on the Colorado Governmental
Immunity Act as it relates to a current lawsuit where the Town was sued when a person
tripped on a manhole that was approximately 4”above the ground.The manhole is
located between two back porches (condominiums)outside the public way.Pursuant to
this lawsuit,Attorney White stressed that the Town should be cognizant of potential
similar situations when building new facilities.
BIG THOMPSON THREE-PHASE CONVERSION PROJECT -CHANGE ORDER
PRESENTATION FOR INFORMATIONAL PURPOSES.
The Department is in the process of closing-out the Big Thompson Three-Phase
Project.A punch list of work required to complete the project has been developed and
staff expects to have a cost estimate from Hamlin Electric within the week.Qwest is
requesting many items and they should be held responsible for funding same.
The original contract amount for this project (and Baldpate—Big Owl Three-Phase
Project)was $758,936.A previous change order request for the Baldpate-Big Owl
Project was approved in November,2002,thus the contract was amended to $779,321
for both projects.The 2002 Budget amount for both projects was $1,040,000.
Upon receiving an agreeable proposal from Hamlin,staff will proceed with completion of
the project.If a commitment from Qwest is obtained,the Department would hire Hamlin
and bill Qwest—all within limitations of the budget.
RECORD OF PROCEEDINGS
Light and Power Committee —January 9,2003 -Page 4
TRENCHING CONTRACT -APPROVAL.
Two small underground projects (Stanley Heights relocation of approximately 450’of
overhead single-phase primary underground and the Dry Gulch relocation of
approximately 570’of existing direct-bury primary line and conduit installation)were bid
with the following results:
TA Enterprises $9,238
Duell Excavating $77,680
Director Matzke explained the unusual circumstances of the Stanley Heights relocation
where a customer paid for underground service (perhaps in the 1960’s).The customer
believes that the Town constructed an overhead line across the property owner’s site to
serve a neighbor.
Discussion followed on precedence-setting policy,with the Committee recommending
the request for the Stanley Heights portion of this project be denied at this time,
proceeding with the Dry Gulch portion in the amount of $4,979.50.
REPORTS.
Platte River Power Authority.No report at this time.
Financial Report.The Committee reviewed the November Income Statement
and associated graphs.Discussion followed on the delay between financial
reporting and the Committee meeting schedule,with Finance Officer Brandjord
and Light and Power Director Matzke working on improving the financial
reporting method or moving the Committee meeting to accommodate the
financial report.
Project Updates.Personnel:two employees retired in December —Ron Hersh
and Ed Dragon.Todd Steichen has been named Interim Line Supt.and Rick
Emerson was named Interim Crew Chief.The Line Supt.position has been
advertised nationally,however,in-house employees may apply as well.A final
selection should be made by the end of March,and a former journeyman lineman
has been re-hired and he will begin work January 20th Administrator Widmet
noted that the line crew is moving forward with a positive attitude,and workspace
improvements are being made.
The decorative light replacements have been ordered,and a savings of
approximately $400/fixture has been established.The first installation scheduled
at Performance Park (15),and Chairman Jeffrey-Clark suggested a ribbon-
cutting event be scheduled honoring the Team’s efforts on this project.
The Electric Rate hearing is scheduled 1/14/03,and staff has received a limited
number of telephone calls.
Approximately 25-50 emergency beacon lights have been sold thus far.
There being no further business,Chairman Jeffrey-Clark adjourned the meeting at 9:34
a.m.
[APPROVED 7
I [I Vickie O’Connor,CMC,Town Clerk
14 ZOQ3j
I TOWN OF ESTES PARK
L BOARD OF TRUSTEES