MINUTES OF BOARD OF COMMISSIONERS' MEETING
LANSING BOARD OF WATER AND LIGHT
___________________________
The
Board of Commissioners met in regular session at 5:35 p.m. in the
Boardroom of the Administrative Offices, 1232 Haco Drive, Lansing,
Michigan. Chair Diane
Royal called the meeting to order.
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Present: |
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Absent: |
Commissioner Nancy W. Duncan. |
The Secretary declared a quorum present.
All said the Pledge of Allegiance.
APPROVAL OF MINUTES
Motion made by Commissioner O’Leary, seconded by Commissioner Creamer, to approve the minutes of regular session held May 22, 2001.
Carried unanimously.
Motion made by Commissioner O’Leary, seconded by Commissioner Creamer, to approve the minutes of executive session held May 22, 2001.
Carried unanimously.
PUBLIC COMMENTS
THE CHAIR ANNOUNCED THAT MEMBERS OF THE PUBLIC ARE WELCOME TO SPEAK TO THE BOARD ON ANY AGENDA SUBJECT OR ON ANY OTHER SUBJECT NOW, OR AT THE END OF THE MEETING.
Peter Berns, Chief Operating Officer of Convergency Center Corporation, updated the Board on his efforts over the past couple of months to put together a model to convert the Ottawa Power Station into a data hub for high-speed internet services. Mr. Berns reported that Convergency has invested time and money into development plans for the Ottawa Power Station. However, a slowdown in the economy and a downturn in the communications arena have caused his company to reassess the marketplace. His goal is to partner with local developers who are integrated with the Lansing marketplace to evaluate alternate uses for the space of the Ottawa Station instead of just “telecom hotel” space. An example would be to create disaster recovery space to maintain backup for large databases and networks that drive the governmental infrastructure. In response to questions raised by the Commissioners, Mr. Berns stated that he wants to start off his relationship with the BWL on the right foot, thus it is important to approach the marketplace at the right time. He noted that if the project reassessment determines that the square footage is right to service the marketplace, Convergency would then finalize the purchase price and execute the joint development agreement with the BWL. The revalidation period is anticipated to take three to four months.
The Committee of the Whole met on May 22, 2001 to receive updates on the following topics:
Chair Pro Tem Ronald Callen called the meeting to order at 7 p.m. Present were Commissioners Callen, Christian, Duncan, O’Leary and Royal. Absent were Commissioners Aquilina, Murray, and Creamer.
Cash Flow for Fiscal Years 2002-2007
Chief Financial Officer Dana Tousley reported on the FY 2002 – FY 2007 cash flow forecast for the Electric, Water and Steam Utilities. The forecast was based on current sales and capital expenditure forecasts, existing rate increases, the FY 2002 budget, 3.0% inflation, a 2% per year fuel escalation, and no additional borrowing. The FY 2002 outlook indicates that approved rate increases and available cash are sufficient and no additional bonding will be required during the upcoming fiscal year for each BWL utility. This excludes what may be required for NOx.
The Electric Utility maintains sufficient cash flow throughout the forecast period. Annual profitability meets the 4.0% return on assets (ROA) target until 2006 at which time it drops to between 2% and 3%. The average ROA for the period is 4.03%. The Water Utility will need additional funds throughout the remainder of the forecast period. The Steam Utility maintains sufficient cash throughout the forecast period. Strategies to address the financial position for the three utilities include:
Finalize NOx compliance plan
No additional rate increases to 2005
Residential price differential 10% below competition
Commercial/Industrial price differential 5% below competition
No debt, except NOx, lower expenses
Steam Utility
Complete Cost of Service Study using FY 2001 as base year
Anticipate rate study and recommendations for rate changes by Winter/Spring 2002
Rate proceeding Summer/Fall 2002
Work with General Motors regarding retirement of Plants 1 and 6
No debt, lower expenses
Water Utility
Change Water Rules and Regulations to lower BWL cost to expand in the townships
No debt, lower costs
Consider a Water Cost of Service Study using 2001 as the base year
Rate Study and Recommendations by Spring 2003
If necessary, rate proceeding Summer/Fall 2003, rates effective 1/1/2004
The Board will be updated regularly throughout the year concerning progress on this approach.
An item-by-item
comparison of the proposed Electric Rules and Regulations to the
current version was provided to the Commissioners in advance for
review prior to the meeting. Doug
Wood, Manager of System Integrity and Customer Projects, presented an
overview of recommended changes to the Electric Rules and Regulations.
Changes are being made to the Electric Rules to maintain
competitive rates, cover existing commitments and preserve the future
bonding capability for environmental and/or other needed requirements.
The proposed changes will
address specific modifications involving construction standards,
customer responsibilities and BWL fees and charges for distribution
and service extension. Following
discussion, the Committee of the Whole concurred with the proposed
changes to the Electric Rules and Regulations.
Staff will be
submitting proposed changes to the Steam and Water Rules and
Regulations for review and comment at the Committee of the Whole
meeting in June. The
Board will then be requested to approve the new Rules and Regulations
for the Electric, Steam and Water Utilities, including Fees and
Charges, at the regular meeting on June 26th for implementation on
July 1, 2001.
Preliminary
Business Plan and Share the Success Performance Objectives for FY
2002.
Kellie Willson, Director of Metrics and Audits, presented a preliminary framework for Share the Success Corporate Measures for fiscal year 2002. In the coming weeks, the corporate measures will be refined and process measures will be developed.
There being no further business, the meeting adjourned at 7:30 p.m.
Respectfully submitted,
Ronald C. Callen, Chair Pro Tem
Committee of the Whole
Moved by Commissioner Creamer, seconded by Commissioner O’Leary, that the Committee of the Whole Report be considered as read in full and approved.
Action: Carried unanimously.
Resolution # 2001-6-20
COMMITTEE OF THE WHOLE
REPORT
The Committee of the Whole met on June 26, 2001 to review the proposed update of the Steam and Water Rules and Regulations.
Chair Pro Tem Ronald Callen called the meeting to order at 5:00 p.m. Present were Commissioners Aquilina, Callen, Christian, Creamer, O’Leary and Royal. Absent were Commissioners Duncan and Murray.
Review of Steam and Water Rules and Regulations
Doug Wood, Manager of System Integrity and Customer Projects, reported that the current Rules and Regulations for Steam Service date back to 1988 and in some cases 1972. These Rules and Regulations have undergone a complete review and update to reflect current practices and policies, a change in system extension and service deposits, elimination of construction specifications, and an update in the fees and charges.
The most recent update made to the Rules and Regulations for Water Service date back to 1993. The proposed new Rules and Regulations for Water Service reflect current practices and policies, a change in the requirements for system extension, and an update in the fees and charges.
The Rules and Regulations for Electric Service were reviewed with the Committee of the Whole on May 22, 2001.
Future plans are to review the Rules and Regulations annually and subsequently bring changes to the Board for approval.
Following discussion, the Commissioners concurred with the proposed changes. A resolution authorizing the adoption of the updated Rules and Regulations for Electric, Steam and Water is included in the General Manager’s Recommendations for consideration at the regular meeting of June 26, 2001.
There being no further business, the meeting adjourned at 5:20 p.m.
Respectfully submitted,
Ronald C. Callen, Chair Pro Tem
Committee of the Whole
Moved by Commissioner Callen, seconded by Commissioner O’Leary, that the Committee of the Whole Report be approved.
Action: Carried unanimously.
Resolution # 2001-6-2
REPORT OF THE NOMINATING COMMITTEE
The Nominating Committee met on June 12, 2001, to review Commissioner survey responses for consideration of nominations for Board officers.
The Nominating Committee recommends the following slate of officer candidates for Fiscal Year 2001-02:
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Chair: |
Ronald C. Callen |
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Vice Chair: |
Diane R. Royal |
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Chair Pro Tem: |
Charles M. Creamer |
Respectfully submitted,
NOMINATING COMMITTEE
Ernest Christian, Chair
Nancy Duncan
Mark Murray
Moved by Commissioner Creamer, seconded by Commissioner Murray, that the Report of the Nominating Committee be adopted as submitted.
Action: Carried unanimously.
GENERAL MANAGER’S RECOMMENDATIONS
Background materials on items presented are on file in the
Office of the Corporate Secretary.
Resolution # 2001-6-3
AWARD PERFORMANCE AUDIT CONTRACT TO R.W. BECK
RESOLVED, that the Board of Water and Light (BWL) enter into a contract with R.W. Beck to conduct a performance audit at a not to exceed price of $123,500. The scope of work shall include only phases 1, 2, 3 and 5 as defined in specifications dated March 30, 2001. The phases are listed below:
Phase 1 – Review of Growth & Expansion
Phase 2 – Review of Cost Accounting Methods
Phase 3 – Review Customer Profitability
Phase 5 – Review of Rate & Fee Processes & Practices
Staff Commentary: In November 2000, the Commissioners received two reports. One from Kellie Willson reviewing major water system extensions and one from Bill Cook on System Growth and Expansion. On November 15, 2000, the General Manager assigned Bill Cook the responsibility of developing and overseeing the implementation of an action plan to address the issues and concerns outlined in the two reports. In January 2001, staff reviewed an action plan with the Board that included developing a request for proposals for a performance audit.
In March of 2001 as recommended in the January action plan, we sent a draft request for proposals to the General Manager and the Commissioners. The final request for proposals was sent to ten firms and five proposals were received. The Growth & Expansion Task Force under Bill Cook’s direction has evaluated the proposals and recommends R.W. Beck be retained to do this work.
The
performance audit will help assure BWL that all the important issues
related to growth and expansion have been identified and are being
addressed appropriately.
Moved by Commissioner Murray, seconded by Commissioner O’Leary, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-4
PAYMENT IN LIEU OF
TAXES
RESOLVED, that the Board of Water and Light enter into an Agreement with the City of Lansing for the next ten years commencing July 1, 2002 to make an annual payment in lieu of taxes. Agreement particulars are as follows:
Staff Commentary: By adding the gross billed total sales (retail and wholesale) for chilled water, electricity, steam and water, it will increase the amount by approximately $1 million per year. The additional payment for March-April- May of 2002 on wholesale sales is estimated to yield approximately $230,000 additional for the City in FY 2002.
Moved by Commissioner Murray, seconded by Commissioner Creamer, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-5
RAIL TRANSPORTATION
AGREEMENT WITH UNION PACIFIC RAILROAD
RESOLVED, That the Board of Water and Light (BWL) enter into a Rail Transportation Agreement (Agreement) with the Union Pacific Railroad (UPRR) for the transport of Powder River Basin (PRB) coal from the mine to interchange with the Canadian National Railroad in Chicago, IL. The Agreement shall be subject to approval as to form by BWL’s Legal Counsel. The Agreement particulars are as follows:
Staff Commentary: BWL also received bids from Burlington Northern Railroad and DTE Transportation Services. A summary of the proposals is attached. A two-year term was selected to coincide with the best rates received for the lease of private railcars.
Moved by Commissioner Creamer, seconded by Commissioner Christian, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-6
LEASE AGREEMENT WITH GENERAL ELECTRIC RAIL CAR SERVICES
CORP.
RESOLVED,
that the Board of Water and Light (BWL) enter into a lease Agreement
(Agreement) with General Electric Railcar Services Corporation (GERSC)
of Chicago, IL, a unit of General Electric Capital Corporation, for
the supply of rail cars. The
Agreement particulars are as follows:
1)
The term of this
Agreement shall be twenty-four (24) months (January 1, 2002 –
December 31, 2003).
2)
GERSC shall provide four
(4) train sets, totaling 470 aluminum fully automatic rapid discharge
coal hopper rail cars with the assurance that they will maintain the
integrity of the train sets at all times during the term of the lease.
3)
The lease rate shall be
$349.00 per car per month (full service – inclusive of all normal
maintenance expenses).
Staff
Commentary:
By entering into this lease
Agreement with GERSC, BWL will be able to guarantee a rail car supply
for the delivery of Power River Basis (PRB) coal from Wyoming at a
substantial savings. These
cars will be dedicated to supply Eckert and Moores Park stations.
Union Pacific Railroad (UPRR) has given BWL a transportation
rate reduction of $1.90 per ton for the use of non-UPRR owned rail
cars. The lease rate will
provide an estimated savings of $.041 per ton for the estimated
movement of 1.2 to 1.5 million tons of PRB coal per year.
This lease Agreement is projected to yield an annual
transportation savings between $400,000 and $615,000.
Moved by Commissioner Creamer, seconded by Commissioner Murray, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-7
BWL
PARTICIPATION IN MPPA GREEN POWER
WHEREAS, the Board of Water and Light of the City of Lansing, Michigan, has an obligation to make its best efforts to assure a reliable and cost effective supply of electricity to its customers; and
WHEREAS, national market studies and local experience has shown that certain retail customers are interested in utilizing renewable energy sources for at least a portion of their electric energy supply; and
WHEREAS, PA 141 of the Michigan Public Acts of 2000 states that the MPSC shall establish the Michigan renewable energy program, one facet of which shall be designed to promote the use of existing renewable energy sources and encourage the development of new facilities; and
WHEREAS, as is required by Section 40 of Act 448, of the Michigan Public Acts of 1976, Michigan Public Power Agency’s Power Pool Project authorized the preparation and distribution of a Windpower Study request-for-proposal; and during its September 20, 2000 Board meeting, approved Bay Energy Services, Incorporated to perform the “Wind Power Project analysis;” and
WHEREAS, the analysis was completed in December 2000 and analyzed factors such as economics, equipment, and wind availability at several sites; and
WHEREAS, this analysis was reviewed by and copies provided to MPPA Commissioners; and
WHEREAS, Michigan Public Power Agency at its April 11, 2001 Board meeting created the “Green (Renewable) Power Project,” which project shall solicit, analyze and recommend all types of green power, such as wind, biomass, hydro, landfill gas for the project participants consideration; and
WHEREAS, it is appropriate and prudent for the Board of Water and Light of the City of Lansing to participate in the renewable energy supply opportunities, such as the MPPA Green Power Project, as a part of its ongoing efforts of exploring options and meeting the electricity supply requirements of its customers.
NOW, THEREFORE, BE IT RESOLVED, That the Board of Water and Light of the City of Lansing will participate in the MPPA Green Power Project for the purposes of determining the economics and feasibility of obtaining energy from the MPPA Green Power Project, and to determine the amount of energy it should obtain in the MPPA Green Power Project. If the participation in the project is determined to be in the best interest of the ratepayers, the Board of Water and Light Commissioners of the City of Lansing would consider authorizing such participation and obligation under separate resolution.
Staff Commentary. The MPPA Power Pool Agreements do not permit any individual Pool member to “shop” for power on their own. MPPA has accommodated the BWL’s request for it’s initial phase of Green Power, but has indicated a more permanent MPPA solution is in order. In addition while the BWL did obtain several small Green Energy suppliers for a period of years, depending on BWL Green Power Program success, it is our best interests to investigate some other possible longer-term solutions as well. Finally, given that other MPPA members are also interested in investigating Green or Renewable resources, MPPA has decided to establish a Project Committee to address this issue. The scope of the Committee would be to study the feasibility of undertaking a Green Power Project in which the MPPA would develop Green Power Resources. In order to implement a Project at MPPA, the participating Project Member must submit a resolution of its governing body stating its desire to become a Project Member. Project costs are allocated among participating members and should be minimal (administrative and general type expenses), absent further BWL Board authorization for expanded participation under a separate resolution.
Moved by Commissioner Murray, seconded by Commissioner Creamer, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-8
SURPLUS PROPERTY – WEST END OF HACO DRIVE
RESOLVED,
that the following parcel located in the City of Lansing be declared
surplus and not required for Board of Water and Light operations.
FURTHER
RESOLVED, that the General Manager and Corporate Secretary be
authorized to enter into an agreement to transfer jurisdiction of this
parcel to the City of Lansing Public Service Department subject to the
requirements of State Law, the Lansing City Charter and Codified
Ordinances.
Parcel
Description:
A part of the former “Lansing Connecting Railroad” (L.C.R.R.), being land on the N.W. ¼ of Section 22, T.4 N., R.2 W., City of Lansing, Ingham County, Michigan, particularly described as follows: Beginning at the intersection of the east line of Pennsylvania Avenue (112.5 ft. wide) and the northeasterly sideline of the former L.C.R.R. (60 ft. wide), said P.O.B. being marked by a found concrete plat monument set in “Haco Subdivision”, L.24, P.42 of Ingham County Plats, and said P.O. B. being on the south line of Haco Drive (60 ft. wide) as platted in “Haco Subdivision”; thence S 00°35’40” W 12.38 ft. along the east line of S. Pennsylvania Avenue; thence S 75°09’20” E 142.37 ft. the beginning of a non-tangential curve; thence along the curve to the right with a radius of 580 ft., a long chord bearing S 63°39’34” E 242.93 ft., an arc distance of 244.74 to a found concrete plat monument set in “Haco Subdivision” and the end of the curve; thence northwesterly 392.31 ft. along the northwesterly sideline of the former L.C.R.R. (the south side of platted Haco Drive) to the point of beginning, containing 2874 sq. ft. or 0.066 acres of land, more or less.
Staff Commentary: This resolution shall constitute the Board’s written consent to transfer jurisdiction of the subject parcel to the Department of Public Service or to such other City department, division or agency as the Mayor deems appropriate; and the transfer shall be effective upon acceptance by the Mayor.
This
parcel is located at the west end of Haco Drive at the intersection of
Pennsylvania Avenue and is currently utilized by the Lansing Public
Service Department for the south entrance lane for Haco Drive.
This parcel is a surplus portion of the Lansing Connection
Railroad Property purchased by the Board of Water and Light in 1998
(Res. No. 97-11-4). The
past and current utilization of this parcel by the City of Lansing
Public Service Department was approved by the Board of Water and Light
without formal documentation. The
purpose of this resolution is to formally transfer jurisdiction and
liabilities for this parcel to the City of Lansing Public Service
Department.
Moved by Commissioner Creamer, seconded by Commissioner Callen, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-9
SURPLUS
PROPERTY – RIVERSIDE PROPERTY
RESOLVED, That the following parcel
located in the City of Lansing be declared surplus and not required
for Board of Water and Light operations.
FURTHER RESOLVED, That the General
Manager and Corporate Secretary be authorized to enter into an
agreement to transfer jurisdiction of this parcel to the City of
Lansing Public Service Department subject to the requirements of State
Law, the Lansing City Charter and Codified Ordinances.
Parcel Description:
Part of the N.W. ¼ of Section 23, T. 4 N., R. 2 W., City of
Lansing, Ingham County, Michigan, being particularly described as
follows: Beginning at the
N.W. Corner of Lot 74 of “Avis Subdivision of the west 20 rods of
outlot “C” Leslie Park” (L. 9, P. 30, Ingham County Plats);
thence southeasterly along the north line of Lot 74 and the extension
thereof 131.74 ft.; thence southerly parallel to and 1 foot westerly
of a chain link fence that runs along the east side of the off-ramp
from north bound Aurelius Road to Main Street, a distance of 743.16
ft. to a point 1 foot west of a deflection point in the chain link
fence; thence continuing southerly along a line 1 foot westerly of
said chain link fence 820.13 ft. to a point on the north line of Grand
Trunk Western Railroad land; thence westerly along said north railroad
line 90.84 ft. to the S.W. corner of Lot 39 of “Avis Subdivision”
(L.9, P. 30, Ingham County Plats); thence northerly along the east
line of Clemens Avenue 1600.04 ft. to the point of beginning,
containing 4.27 acres of land, more or less.
Staff Commentary: This resolution shall constitute the Board’s written consent to transfer jurisdiction of the subject parcel to the Department of Public Service or to such other City department, division or agency as the Mayor deems appropriate; and the transfer shall be effective upon acceptance by the Mayor.
This parcel is located on and along
the west side of the Board of Water and Light Riverside Property and
is currently utilized by the City of Lansing Public Service Department
for an extension of Aurelius Road and an off-ramp from Aurelius Road
to Main Street. The past
and current utilization of this parcel by the City of Lansing Public
Service Department was approved by the Board of Water and Light
without formal documentation. The
purpose of this resolution is to formally transfer jurisdiction and
liabilities for this parcel to the City of Lansing Public Service
Department.
Moved by Commissioner Callen, seconded by Commissioner Murray, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-10
Authorization to Enter into
a Use Agreement with City of Lansing
WHEREAS, certain real property
(known as 312 North Grand Avenue), more particularly described below,
is under the jurisdiction of the Board of Water and Light, and
WHEREAS, the City of Lansing by its
Public Service Department desires a right of way to use a portion of
such real property for the purpose of drainage structures, and
WHEREAS, pursuant to 5-203.7 of the
Lansing City Charter, the Board of Water and Light and other agencies
of the City are encouraged to cooperate on projects deemed to be
beneficial to the City, and
WHEREAS, the right-of-way area is
located on a portion of the north end of the North Grand Avenue
property and described as follows:
Right of Way Description:
The northerly 40 ft. of the south 00 ft. of Lot 9 of Block 66,
original plat of the town of Michigan, now City of Lansing, as
recorded in L. 2, PP. 36-38 of Ingham County Plats.
RESOLVED,
That the Board authorize the General Manager and Corporate Secretary
to enter into a Use Agreement with the City of Lansing to formalize
the City of Lansing Public Service Department’s current operation of
a drainage outlet facility in the right-of-way area.
Staff Commentary: This right of way has been requested by the City Engineer to formalize current operation of a drainage outlet facility in the right-of-way area. The drainage facilities were constructed in 1995 as part of the City of Lansing’s replacement of the Shiawassee Street Bridge over the Grand River. The past and current utilization of this parcel by the City of Lansing Public Service Department was approved by the Board of Water and Light without formal documentation.
Moved by Commissioner Creamer, seconded by Commissioner Murray, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-11
ADOPTION OF NEW STEAM SERVICE POLICY
RESOLVED, That the adoption of new Board of Water and Light policy 19-15, Steam Rules and Regulations shall state that:
The steam rules and regulations shall govern the steam services and shall be subject to review and modification by the Commissioners.
Staff Commentary: This new policy for steam rules and regulations is consistent with policy 19-05, Electric Rules and Regulations, which provides for Commissioner review and modification of services provided.
Commissioner review and modification of the Board of Water and Light rules and regulations for service provides a regulatory review and approval similar to that of other municipal utilities and the Michigan Public Service Commission.
Moved by Commissioner Creamer, seconded by Commissioner Callen, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-12
ADOPT RULES AND REGULATIONS FOR STEAM SERVICE
RESOLVED, That the adoption of the attached Board of Water and Light Rules and Regulations for Steam Service become effective July 1, 2001 subject to final legal review.
Staff Commentary: Rules and Regulations For Steam Service date back to 1988 and in some cases 1972. The Rules and Regulations For Steam Service have undergone a complete review and have been updated to reflect current practices and policies, a change in system extension and service deposits, elimination of construction specifications, and an update in the fees and charges.
Commissioner review and modification of the Board of Water and Light rules and regulations for service provides a regulatory review and approval similar to that of other municipal utilities and the Michigan Public Service Commission.
Moved by Commissioner O’Leary, seconded by Commissioner Christian, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-13
ADOPTION OF NEW WATER SERVICE POLICY
RESOLVED,
That Board of Water and Light Water Service Policy 19-13 is hereby
rescinded.
FURTHER
RESOLVED, That the adoption of new Board of Water and Light policy
19-13, Water Rules and Regulations shall state that:
The water rules and regulations shall govern the water services and shall be subject to review and modification by the Commissioners.
Staff Commentary: This new policy for water rules and regulations is consistent with policy 19-05, Electric Rules and Regulations, which provides for Board review and modification of services provided.
Commissioner review and modification of the Board of Water and Light rules and regulations for service provides a regulatory review and approval similar to that of other municipal utilities and the Michigan Public Service Commission.
Moved by Commissioner Christian, seconded by Commissioner Callen, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-14
ADOPTION OF WATER SERVICE RULES AND REGULATIONS
RESOLVED, That the adoption of the attached Board of Water and Light Rules and Regulations For Water Service become effective July 1, 2001 subject to final legal review.
Staff Commentary: Rules and Regulations For Water Service reflect current practices and policies, a change in the requirements for system extension, and an update in the fees and charges.
Board review and modification of the Board of Water and Light rules and regulations for service provides a regulatory review and approval similar to that of other municipal utilities and the Michigan Public Service Commission.
Moved by Commissioner Creamer, seconded by Commissioner Christian, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-15
ADOPTION OF ELECTRIC RULES AND REGULATIONS
WHEREAS, in accordance with Board policy 19-05, the electric rules and regulations shall be subject to review and modification by the Commissioners.
NOW THEREFORE BE IT RESOLVED, That the adoption of the Board of Water and Light Rules and Regulations For Electric Service as submitted to the Board on May 14, 2001 become effective July 1, 2001 subject to final legal review.
Staff Commentary: Rules and Regulations For Electric Service date back to 1993 and in many cases 1983. The Rules and Regulations for Electric Service have undergone a complete review and have been updated to reflect current practices and policies, a change in system extension deposits, inclusion of new fees and charges, and updates to other fees and charges.
Board review and modification of the Board of Water and Light rules and regulations for service provides a regulatory review and approval similar to that of other municipal utilities and the Michigan Public Service Commission.
Moved by Commissioner O’Leary, seconded by Commissioner Creamer, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-16
CAPITAL PROJECT APPROVAL – POLICY 15-02 LANGUAGE CORRECTION
RESOLVED, That Board of Water and Light policy 15-02, Capital Project Approval, be restated as follows:
Any project included in the capital budget, but expected to exceed the budgeted amount by the greater of 15% of the budgeted amount or $200,000 must be approved by the Commissioners. This applies to the aggregate for electric, water and steam expenditure forecasts in the Annual Capital Budget and to individual projects in the Planned Capital Budget. The General Manager shall report any anticipated changes in scope or cost overruns to the Commissioners as soon as possible. The General Manager shall establish and implement procedures overseeing Capital project costs consistent with this policy.
Staff Commentary: This correction of policy 15-02, Capital Project Approval, will make it consistent with policy 19-08, Line Extensions and Service Territory Expansions. At present, policy 15-02 requires Commissioner approval for the lesser of 15% or $200,000 and does not define how it should be applied. Policy 15-19 requires Commissioner approval for the greater of 15% or $200,000.
Moved by Commissioner Murray, seconded by Commissioner Christian, that the resolution be approved.
Action: Carried unanimously.
UNFINISHED BUSINESS
None.
NEW BUSINESS
None.
RESOLUTIONS
Resolution # 2001-6-17
Resolution Honoring Rosemarie
E. Aquilina
WHEREAS, It is with deep appreciation that we offer tribute to Rosemarie Aquilina as she brings to a close her term as Commissioner of the Board of Water and Light. She was appointed as a First Ward Commissioner of the Board of Water and Light on October 6, 1997, and
WHEREAS, She was elected Chair Pro Tem in 1998 and served on various committees such as the Personnel Committee 1997 and 2000, the Finance Committee in 1998 and 1999, and chaired the Nominating Committee in 2000, and
WHEREAS, As a Board Commissioner, Rosemarie Aquilina contributed leadership over the years in a variety of matters affecting this utility. Her insight and knowledge of the legislative arena greatly contributed in developing the Board of Water and Light’s fundamental electric restructuring principles in the protection of both the industry and the consumer. She never lost sight of the goal of assuring that electric, water and steam are reliable and delivered at the lowest price possible, and
WHEREAS, Rosemarie Aquilina’s passion for the law started early in her life, including pursuance of a law degree at Thomas M. Cooley Law School, from where she graduated. She is an attorney in private practice as well as a military attorney. She is known as a successful litigator due to her fearless pursuit of victory and her remarkable win record, and
WHEREAS, Rosemarie Aquilina has demonstrated high ideals of personal endeavor through her many civic involvements and service in the Michigan Army National Guard. She has the distinction of being the first and only female Judge Advocate General officer in the Michigan Army National Guard. In addition to that honor, she also holds the rank of Major. She has touched many lives through her career and community activism. Her professionalism, hard work, and sensitivity to the needs of the public have won for her the respect and admiration of all who have the good fortune of knowing her, and
RESOLVED, That the Board of Water and Light Commissioners congratulate and thank Rosemarie Aquilina for her service on this Board. In regular session this 26th day of June, 2001, we wish Rose and her family our best wishes for the future and happiness in their new home in Okemos.
Moved by Commissioner Creamer, seconded by Commissioner Christian, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-18
Resolution Honoring Mark
A. Murray
WHEREAS, It is with great appreciation that we offer tribute to Mark A. Murray for his dedicated service as a Third Ward Commissioner of the Lansing Board of Water and Light, and
WHEREAS, Mark Murray was appointed to the Board of Commissioners on February 15, 1999, and served on the Board with distinction. During his term, he served as a member of the Finance Committee from 1999 to present and was named chair of the committee in 2000. He also served on the Nominating Committee in 2000 and 2001, and
WHEREAS, Among his major accomplishments during his tenure on the Board was emphasizing the importance of setting organizational direction by focusing on the strategic goals of the utility and monitoring organizational performance to assure the utility is operating in an efficient manner in order to remain competitive, and
WHEREAS, Mark Murray’s public service career has taken many forms. His service to the people of the City of Lansing and the State of Michigan began right out of college, working for Governors William Milliken, James Blanchard and John Engler. Though he has spent most of his career in state government, Mark Murray spent a year as Vice President for Finance and Operations at Michigan State University in 1998. He was named State Treasurer by Governor Engler in 1999. Throughout his career, he has displayed intelligence and diligence in every endeavor. His skills to assess and solve problems and get along with people with a wide range of views uniquely qualified him for the post of special policy adviser to Governor Engler. He has been a tireless advocate and spokesperson in promoting the highest standards of excellence in school quality in the State. His ethics, integrity and honor are unquestioned and provide a model to all those who may follow in his footsteps of public service, and
WHEREAS, His professionalism and commitment to public service merit our highest praise. As he steps down from his post of State Treasurer to begin a new chapter in his brilliant career as President of Grand Valley State University effective July 1, 2001, we extend to him our sincere best wishes for continued success.
RESOLVED, That the Board of Commissioners congratulate and thank Mark Murray for his outstanding career. In regular session this 26th day of June, 2001, we wish Mark, his wife Elizabeth, and family the very best and well-deserved happiness and fulfillment.
Moved by Commissioner Callen, seconded by Commissioner Creamer, that the resolution be approved.
Action: Carried unanimously.
Resolution # 2001-6-19
Resolution Honoring
David O’Leary
WHEREAS, It is with respect and appreciation that the members of this Board join in offering highest tribute to David O’Leary as he completes his tenure as an At-Large Commissioner of the Board of Water and Light with over 11 years of service, and
WHEREAS, David O’Leary was appointed to the Board on May 21, 1990. He was elected Chair in 1996, Vice Chair in 1998, and he served on the Nominating Committee in 1998 and 1999, Personnel Committee from 1990-2000, Finance Committee in 2000-01, and ad hoc committees formed to study issues related to development and governmental relations, and
WHEREAS, Highlights of his years on the Board include major Board accomplishments in areas such as overturning the potential sale of the BWL to Utilicorp in 1992, relocating the Customer Service Center and Administration Building and realigning employee work locations to renovated facilities at 730 Hazel, 830 Hazel and 1232 Haco Drive (1998), water extensions to serve Alaiedon Township, Bath Township, City of DeWitt/DeWitt Township and East Lansing-Meridian Township (1999-2000), new compensation system for non-bargaining employees (2000), construction of a new central utilities complex to serve the General Motors Grand River Assembly Plant and construction of a chilled water system to serve downtown buildings (2000-2001), and
WHEREAS, He has also served on various local and national boards; such as past president of the Rotary Club, active service with Capitol National Bank, Capitol Bancorp, WKAR-TV Corp. Council, Catholic Social Services, and St. Lawrence Hospital Advisory Board, and
WHEREAS, His leadership skills guided him wisely throughout his career as President of O’Leary Paint Company. Through hard work, commitment to quality, and genuine love of his work, he has maintained the highest standards of excellence in all capacities, especially in overseeing growth and diversification in his family-owned business. These attributes have won him accolades such as the Hall of Fame Award from the National Art Materials Trade Association and the Businessperson of the Year from the Lansing Chamber of Commerce, and
WHEREAS, Many words come to mind to describe Dave and capture his essence -- an avid Notre Dame fan, a community leader, loyal, intelligent, hard working; and possessing a humorous nature. We will miss his quick wit and funny stories!
RESOLVED, That the highest tribute be accorded to David O’Leary as he brings to a close his tenure as a Commissioner. May this serve as a testimony of recognition of the high esteem in which he is held by the Board of Water and Light Commissioners and the customers of this utility. In regular session this 26th day of June, 2001, we wish Dave, his wife Janet, and family the very best and well-deserved happiness and fulfillment.
Moved by Commissioner Murray, seconded by Commissioner Creamer, that the resolution be approved.
Action: Carried unanimously.
GENERAL MANAGER'S REMARKS
NOx
Compliance Update.
General Manager Pandy distributed a report dated June 25, 2001
on the status of Nitrogen Oxides (NOx) emission compliance
that Manager of Environmental Services Nick Burwell prepared in
response to a letter received from Commissioner Callen.
The memo provides a history of the NOx regulations
and a guess at what the future regulations will be in light of the
recent court rulings on NOx compliance.
Compliance issues and alternatives are also outlined in Mr.
Burwell’s report. In
December, staff plans to report further on alternative compliance
strategies and recommend an action plan to comply with NOx
in the future. Mr. Pandy
noted that NOx compliance was omitted from the capital
forecast due to the magnitude of the cost, estimated to be on the
order of $20-$50 million.
GreenWise
Electric Program Kick-Off on June 28. General Manager Pandy reported that the BWL plans
to launch its “GreenWise Electric Power” program on June 28th.
GreenWise electric power is an environmentally friendly energy
program that allows customers to buy some or all of their electricity
from clean, renewable sources like wind, water and biomass.
Customers will be able to purchase blocks of 250 kilowatt-hours
per month at a cost of $7.50 per month (or roughly 3 cents per
kilowatt-hour premium). There are 2700 blocks available.
The Commissioners were invited to come to participate and speak
in support of the green power program.
Payment
in Lieu of Taxes to the City of Lansing. General Manager Pandy distributed a memo prepared
by General Accounting Manager David Cluley, dated June 18, 2001,
regarding the fiscal 2000-01 payment in lieu of taxes to the City of
Lansing. Selected
operating revenues were used through May 31, 2001 to calculate the
amount. The amount for
this fiscal year is $6,618,244, which is approximately 3% more than
last year, or approximately $189,000 more. The City of Lansing continues to benefit from the
BWL’s revenues on the 4% formula.
Under the new agreement, adopted by the Board today (Resolution #2001-6-4)
going forward beyond fiscal year 2002, the City will enjoy the
benefits of the BWL’s wholesale revenues, in addition to retail
sales), which increases the amount by approximately $1 million per
year. The current
agreement due to expire June 30, 2002, is based solely on retail
revenue.
Share
the Success Update:
General Manager Pandy reported that the Share the Success
program is coming to a close this fiscal year with a decent financial
year. Corporate measures
picked up 33 additional points for a total of 170 points for the
fiscal year. If the fiscal year ends that way on June 30,
employees would earn performance bonuses equal to 1.70% of annual pay. The process bonuses range from 2.12% up to 3.70%.
Mr. Pandy noted that the customer satisfaction survey numbers
are coming in very strong. The
results of the spring survey will be reported to the Board at a future
meeting.
BWL
Organizational Changes for FY 2002.
General Manager Pandy reported that Clyde Dugan and Jack Hill
will be taking on new responsibilities effective with the new fiscal
year. Jack Hill will
assume a new leadership role in the area of safety and environmental
compliance. Mr. Hill was commended for his excellent job with
special projects. Clyde
Dugan will assume a new leadership role in special projects.
Mr. Dugan was praised for his outstanding job in Marketing.
Both Jack Hill and Clyde Dugan will work as a team as will
their respective staffs to make that orderly transition in the new
fiscal year.
IBEW
Elects Officers.
General Manager Pandy reported on the results of the recent
IBEW election. He
congratulated Curt Gates who was re-elected Business Agent and Joe
Davis who was re-elected president.
Congratulations
to BWL Tapping Teams.
General Manger Pandy reported that both the men’s and the
women’s tapping teams won the state of Michigan tapping contest.
This is the first time the BWL has ever had a female tapping
team. Both teams
participated in the American Water Works Association national
competition. The men won
second place for the whole nation at 1:23.47 minutes and the women’s
team won third place for the whole nation at 2:27.59 minutes.
They won a tapping machine, valued at approximately $1,500,
which was returned to the BWL. Mr.
Pandy congratulated these employees for representing the BWL very
admirably against numerous utilities.
REMARKS BY COMMISSIONERS
Commissioner
Creamer congratulated the members of the Special Board Committee
formed to negotiate the new relationship with the City of Lansing on
the payment in lieu of taxes. The
committee was comprised of Commissioners O’Leary, Murray and Royal
and General Manager Pandy.
Commissioner
Callen reported that he had the pleasure of attending the American
Public Power Association (APPA) Annual Meeting.
He reported on some of the important insights gained at the
conference, such as the deregulation situation in California and
utility initiatives such as assisting Habitat for Humanity in building
energy efficient homes. Commissioner
Callen encouraged each Commissioner to avail themselves of the
opportunity to attend such a conference to see and hear of the
activity and earnestness with which municipal utilities, large and
small conduct their business. Commissioner
Callen distributed a written report he prepared on the Annual Meeting
of the APPA June 18-20, 2001.
EXCUSED ABSENCE
On motion by Commissioner Christian and seconded by Commissioner Murray, that the absence of Commissioner Duncan be excused.
Carried unanimously.
PUBLIC COMMENTS
THE CHAIR ANNOUNCED THAT MEMBERS OF THE PUBLIC ARE WELCOME TO SPEAK TO THE BOARD ON ANY BOARD OF WATER AND LIGHT SUBJECT.
None.
ADJOURNMENT
On motion by Commissioner Creamer, and seconded by Commissioner Murray, the meeting adjourned by unanimous consent at 6:30 p.m.
/s/ Mary E. Sova, Secretary
Filed with Lansing City Clerk
June 29, 2001