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HomeMy WebLinkAboutLight Comm 04/28/2025Mansfield Municipal Electric Department Minutes of Light Commissioners Meeting April 28, 2025 Present: Chairman Brendan Roche, Clerk Maureen Doherty, Commissioner Michael Trowbridge, General Manager Joe Sollecito, Business and Finance Manager Joe Pereira 1) Open Meeting - Call to Order & Pledge of Allegiance. The meeting was held at the Mansfield Town Hall Room 2AB and called to order at 6:02 PM followed by the Pledge of Allegiance. 2) Vote to enter into Executive Session for the following reasons and to return to open session a) Review and consideration to approve minutes of March 17, 2025 Executive Session where Exemptions 3 was declared b) Pursuant to M.G.L. Ch. 164, Section 47D and M.G.L. Ch. 30, Section 21, Exemption 3, to discuss strategy with respect to collective bargaining (IBEW Local 104 Professional and Financial Assistants units and AFSCM Local 1702) if an open meeting may have a detrimental effect on the bargaining position of the public body and the chair so declares. c) Review and consideration to approve for release previously approved but not released Executive Session minutes for the following meetings: i) October 26, 2015 where Exemptions 3 & 10 were declared ii) November 4, 2015 where Exemptions 3 & 10 were declared iii) January 02, 2019 where Exemptions 3 & 6 were declared (unredacted) iv) April 29, 2019 where Exemptions 3, 6 & 10 were declared (umedacted) v) May 15, 2019 where Exemptions 3 & 6 were declared (umedacted) vi) July 02, 2019 where Exemptions 3 & 6 were declared (umedacted) vii) April 26, 2021 where Exemption 10 was declared viii) June 21, 2021 where Exemption 10 was declared' ix) September 20, 2011 where Exemption 2 was declared x) October 18, 2021 where Exemption 2 was declared r "Un xi) November 15, 2021 where Exemption 2 was declared rn xii) January 24, 2022 where Exemptions 3 & 10 were declared xiii) February 28, 2022 where Exemptions 2, 3 & 10 were declared i!ilQj Z' xiv) March 21, 2022 where Exemptions 2, 3 & 10 were declared i 4a xv) April 25, 2022 where Exemption 10 was declared n o CO xvi) April 25, 2022 where Exemption 3 was declared rn xvii) May 16, 2022 where Exemption 3 was declared xviii) July 18, 2022 where Exemption 3 was declared xix) August 22, 2022 where Exemption 3 was declared xx) November 21, 2022 where Exemptions 2 & 3 were declared xxi) December 19, 2022 where Exemptions 2, 3 & 10 were declared xxii) February 13, 2023 where Exemptions 2 & 3 were declared xxiii) March 20, 2023 where Exemptions 2, 3 & 10 were declared xxiv) May 22, 2023 where Exemption 3 was declared xxv) July 17, 2023 where Exemption 2 was declared xxvi) September 18, 2023 where Exemption 10 was declared xxvii) November 20, 2023 were Exemption 3 was declared d) Vote to return to open session Motion (Doherty/Trowbridge) Roll Call Vote: Trowbridge -Yes, Doherty -Yes, Roche -Yes. Entered into Executive Session at 6:05 PM. Return to open session at 6:17pm. 3) Review and consideration to approve March 17, 2025 Board Minutes Motion to approve Board Minutes. (Doherty/Trowbridge) Passes 3/0. 4) General Manager's Report a) Consideration to approve Memorandum of Agreement (IBEW 104 Professional unit) The new contract calls for increases to the COLA and the health insurance stipend. It also includes adjustments to the gym and health club reimbursement. Motion to accept MOA with the IBEW 104 Professional Unit. (Doherty/Trowbridge) Passes 3/0. b) Review of Power Supply with Mayhew Seavey, PLM The total cost of power is forecast to decrease by $542,000, despite an almost 5% larger load. The average cost of power is expected to drop by .6 cents, with energy costs higher, but transmission and capacity costs decreasing for FY25. For FY 26 these decreases are not expected to continue. The total energy load is forecast to be 230 million kWh, with sales forecast at 221 million kWh. In modeling projected costs, outages at the nuclear facilities are taken into consideration, in addition to Branch St solar and hedge transactions. He also discussed that capacity prices dropped in June 2024 and will stay at that level through May 2026 and that transmission rates from ISO -NE increased 20% in January 2025 but are forecast to decrease slightly in January 2026. Manager Sollecito noted that about 70% of the budget is power supply and therefore outside the boundaries of Mansfield. c) Review and consideration to approve MMED's FY2026 Operating Budget Joe Pereira stated that MMED's revenue is up due to increased load. The 2026 budge projection shows that revenue will increase by $750,000, non -power expenses will increase by $607,000, and power expenses will decrease by $236,000. This will result in a total impact to net income of an increase of $325,000. Even though Mansfield is approximately 90% residential, for electric sales there is a fairly balanced split of one-third residential, one-third small and medium commercial, and one-third large commercial accounts. For expenses, purchased power constitutes 65% of the budget. Non -power expenses, such as salaries, constitute 20%, with labor costs increasing 6.1%. The rest is non -labor expenses such as tree trimming, police details and MMWEC activities. Generation sources have already passed the 2030 goal and approaching the 2050 goal. They are about 57% carbon free. Manager Sollecito noted that in the 2028 budget we have a contract with Nextera for non -carbon -based power for 40 years, which will put us past the 2040 goal. The PILOT payment is $780,000, which is about $105,000 more than the method used to calculate several years ago. Budget risks and assumptions include economic, political and environmental factors, as well as load shifts due to customer behavior. Chairman Roche noted that next year the commission should look at redoing the calculation for the PILOT. d) Review and consideration to approve MMED's FY2026 Capital Budget with 5-year Plan Manager Sollecito stated that engineer Hamid Jaffari did a great job putting together the capital budget. It includes carry over projects from 2025, new FY 2026 projects, general 'blanket' costs, and reimbursable projects. The largest carry over is a digger truck that was approved in 2025 but has yet to come in. The department is seeking approval for the capacitor and controls replacement project, the Clark Shores Condo Association underground conversion, as well as other projects. Three trucks are slated for replacement as well, with a bucket truck not expected to be received for two years. Commissioner Trowbridge asked what the cash position is. Joe Pereira responded that we are at $12.5 million operating cash, with overall at about $20 million. e) Review of Rate Recommendations with Mayhew Seavey, PLM and consideration to approve Mr. Seavey's recommendation is to maintain our current rate levels. Even though costs are down this year and there is the ability to lower rates. However, it is known that next year's costs will increase, so it does not make sense to make changes for one year. For better flow, the recommendation is to decrease the purchased power charge and increase the distribution charge. This would prevent over collecting on the purchased power charge, which is supposed to be a no income rate. The residential purchased power charge is under collecting and therefore being subsidized by commercial charges, which happens frequently. This is an opportunity to correct that issue without an impact on the customer. Mr. Seavey's charts show the levels at which each class is under or over collecting in both purchased power and distribution. He proposes to continue the gradual increase of the customer charge to keep up with what it actually costs to send a bill. The purchased power charge should be adjusted to give a small rate of return to build up rate stabilization funds. The distribution charges should be adjusted to achieve the same revenue level as present rates. Commissioner Trowbridge noted that we do not want to be losing money in any rate class. Manager Sollecito noted that in most utilities the commercial base almost always subsidizes the residential base to an extent. Mr. Seavey also clarified that with the margin of error on the rate structure the residential rates may actually end up even. He has presented a chart for each rate class showing the present rates and the proposed rates. With the proposed changes the net effects to the customers will be zero. Manager Sollecito noted that there is some uncertainty in the markets currently due to Hydro Quebec insisting they have not sold any energy across the border. The summer months may change that. We still have the second lowest rates in the state and want to take advantage of that. He made a recommendation to approve the power supply, operating budget, capital budget and rate recommendations. Motion to approve the FY 26 operating budget as presented. (Doherty/Trowbridge) Passes 310. Motion to approve the FY 26 capital budget as presented. (Doherty/Trowbridge) Passes 310. Motion to approve the FY 26 rate recommendations. (Doherty/Trowbridge) Passes 3/0. f) Review and consideration to approve H. Jaffari IFP Award Recommendation for 15 KV Capacitors & Controls Per Manager Sollecito, engineer Hamid Jaffari has recommended purchase of all capacitors and controls now because it is economically more feasible. The low bidder was WESCO. Motion to approve the award recommendation for 15kV Capacitors and Controls. (Doherty/Trowbridge) Passes 3/0. At this time the Commission skipped ahead to items S and 6 due to Clerk Doherty leaving early. Clerk Doherty departed at 7:10pm. g) Update on Inventory Control Manager Sollecito reminded the commission of the issues that existed with the inventory. He noted that many internal meetings have been held to get the system organized and the NDS inventory system has been updated. The purchasing clerk has announced his retirement, so they are working to get this year's inventory covered with other staff to get the audit done correctly. h) Update on office construction project The project is almost 90% done. There has been a lot of work in the kitchen and the bathrooms. Joe Pereira's office is done and the other front offices are done. He is expecting to be done by the second week of May. i) Update on Public Power negotiations (MEAM) with state This has been a struggle because it seems that the state wants to press down upon the MLP's. The negotiating committee has had discussions about a lawsuit needing to happen. However, it seems the state is finally starting to hear the argument from MEAM and the MLP's. There has already been a Massachusetts Supreme Court case to determine whether the state has power of the MLP's. It has been determined that it does not. The state has offered a waiver to the MLP's, because they want to discuss other cooperative efforts. MEAM has stated they cannot discuss other things until this is settled. The big issue is that there is a penalty involved if we do not comply by June 30. MEAM has continued to threaten the lawsuit to try to stop it. With the state trying to electrify, they don't seem to be listening to reason. With the costs two and a half times less in Mansfield, why add things that would increase the costs. Keep the low price as incentive to electrify. j) Review advocacy requirements (lobbying efforts) of Public Power A question arose for which MEAM sponsored a legal opinion. If an MLP put a call to action on their own letterhead to a congressperson, they could be qualified as a lobbyist, and therefore would have to register as such. It involves a fee of $200 and keeping track of finances. Manager Sollecito asked for the board's opinion on whether to do that. Commissioner Trowbridge noted that MMED needs to advocate for ourselves because no one else will. Manager Sollecito noted that MEAM, MMWEC and ENE are already registered lobbyists, but their letterhead would not have as much effect on our customers as our own would. 5) Citizens Questions & Comments - None 6) Commissioners Questions & Comments a) General Manager evaluation — Chairman Roche stated that General Manager Sollecito received overall good grades on his evaluation. He noted that the commissioners made a few recommendations of areas to work on. Manager Sollecito thanked them and stated that he would not be successful without the commission's support or that of his staff. Chairman Roche agreed that they are appreciative of the staff as well. 7) Any items not anticipated by the Chair 48 hours prior to this meeting a) As this was Commissioner Trowbridge's last meeting, Chairman Roche expressed his gratitude to Commissioner Trowbridge for his service. He also expressed thanks to Commissioner Bren, who is also ending her service. Manager Sollecito also expressed his thanks. 8) Adjourn 7:20pm Motion to Adjourn (Trow6ridge/Roche) passes 2-0 Respectfully submitted: Katherine Duggan 0�//6/Z� Signature of Clerk Date of Approval