HomeMy WebLinkAboutlc_05232012 Mansfield Municipal Electric Department REDEIVE�
Minutes of Light Commissioners Meeting TOW S°
May 23,2012 t a 1''
nu_ se 114 A Present: Chairman George Dentino, Vice Chairman Kevin Moran; Clerk Dcjbi;S
Commissioner Jess Aptowitz; Director Gary Babin; Town Manager Willi ,
Absent: Olivier Kozlowski came into meeting 7:10pm
Light Commissioners Meeting
The meeting was called to order at 7:00 PM. Chairman Dentino stated that this meeting was
being televised and taped by Mansfield Cable Access.
Motion: To approve April 17,2012 minutes (Annino/Aptowitz) 4:0 passes
Financial Statements for March 2012 -Director Babin stated that net operating income
year-to-date through March is $68,081while non-operating income is $11,525. This is net
of the $2.2 million rebate to customers in January and February 2012 that must be calculated
into net income.
He indicated the FY12 over-collection of Generation Charge revenues i s $602,414, which
is not taken into account when computing FY12 net income.
Director Babin said that MMED's operating cash position through March 2012 was
$7,564,520, which when adjusted taking into account Generation Charge over-collection is
$7,421,203. This compares with adjusted cash for February of$8,804,935 and adjusted cash
for January of$9,231,390.
Overall, there has been a$1.66 million reduction in operating cash due to the $2.2 million
rebate between January and March.
He stated that through March, that the Generation Charge payable stands at $143,317 and
that this over collection will be factored into calculation of the 3rd quarter 2012 Generation
Charge.
Energy sales for March 2012 are down 8.3% from March 2011. For the year, there is a
6.1% reduction in energy sales between FY11 and FY12.
Director Babin stated that MMED's depreciation fund balance stands at $6,849,356 and that
the money is now being drawn down to pay contractor and equipment costs associated
with the East Mansfield substation construction.
Commissioner Aptowitz wanted to emphasize that the reduction of income was due to a
recent customer rebate, not that MMED had lost money. He felt it is important to document
this so that the auditors don't see the dip in future years and not realize why. As a result he
requested that a footnote be added to the audit to this effect.
The Commissioners were also concerned over the impact of solar energy use on the MMED
bottom line. Mr. Ross stated that he and Mr. Babin have discussed this possibility as the use
of solar energy goes online at the landfill.
Chairman Dentino stated that he did not feel that solar use will greatly impact them as long
they keep an eye on the rate. He felt that MMED is in a good position with finances, work
force and upkeep on their infrastructure.
MMWEC Retail Rate Comparison -Director Babin indicated that MMWEC has supplied
information on the latest rate comparison data for all the electric utilities in Massachusetts. He
referred the Board to an analysis of that data along with the MMWEC data.
Director Babin said that the competitive position of MMED's rates for residential customers
was quite good with the rate classes measured being in the lower quarter to lower half of the
45 utilities compared based on an average of the prior 12 months. The commercial classes of
customers for the month of March 2012 only were not as good, however, and typically placed
in the upper third of those utilities measured.
Commissioner Moran asked about the rates offered to commercial customers through
National Grid. Mr. Babin briefly explained how MMED has fixed costs, such as debt and
O&M for generating plants in which it has an interest, that must be paid and which affect
rates. National Grid on the other hand does not have to carry those costs as they buy power
directly from the market, which is quite low now, and simply pass through the cost to their
customers. This is what allows National Grid to have lower rates in some cases than MMED.
Chairman Dentino had a few questions about the rate comparison data. He said he likes to
compare Mansfield to North Attleboro as they are a similar sized community with a municipal
light department. He stated that North Attleboro seems to be able to offer their customers
rebates and lower rates more than Mansfield does. He would like to see more research on
lowering our commercial rates.
East Mansfield Substation Update — Director Babin referred to a cost summary of the
project that was included in the board package and updated the Board on the current status of
the East Mansfield substation construction. The site has most of the equipment installed and
drainage work has also commenced. Landscaping of the abutters has started, offering the
neighbors a natural screen from the structures.
Commissioner Moran stated that he has been to the site a few time and has not received any
complaints about noise. Director Babin stated that they have not received a single complaint
from the neighborhood and had been in constant contact with the neighbors.
Commissioner Aptowitz referred to a summary of substation expenditures in the Board
package. Director Babin explained how the billing and holding of retainage has been done.
Commissioner Annino had a couple of questions about construction costs. Mr. Ross and Mr.
Babin have met with the general contractor,the Ryan Company, and discussed reimbursement
for extra costs due to delays from the transformer manufacturer. This was primarily due to
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delays in permitting in the different states that the transporter had to pass through, although
the units themselves were also shipped later than promised.
With regard to the East Mansfield Substation Bid Summary included in the Board package,
Chairman Dentino stated that the fact that the numbers were under budget indicated that the
budgets were artificially inflated. Mr. Babin stated that the staff did not inflate the numbers
and they were based on the best information available at the time the estimates were prepared.
He then reviewed the budget and bid award numbers and how the costs some costs are lower
due to the poor construction related economy.
New Business - Director Babin spoke about a joint training exercise that MMED had
participated in with the police and fire departments. The scenario practiced was if an MMED
employee should be severely injured on the job, how the department would proceed and
define the roles each would play. Mr. Babin thanked Deputy Chief Puleo and Line Foreman
Gary D'Ambra for all their planning in making the training successful. Commissioner
Aptowitz stated he had attended some of the training and it was impressive.
Old Business: Chairman Dentino gives his apologies for not being able to attend the
Memorial Day parade this year and hand out candy to the kids.
Motion: To adjourn the Light Commissioners meeting at 8:10pm.
(Kozlowski) 5:0 passes
Signature of Clerk Date of Approval
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