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HomeMy WebLinkAboutLIGHTCOMM MIN07132009 Mansfield Municipal Electric Department "_,I Minutes of Light Commissioners Meeting i i C~ July 13,2009 , ~ j: ~ 0 ,'," I I Present: Chairman Jess Aptowitz; Vice Chairman Kevin Moran; Clerk Ann Baldwin; Commissioner George Dentino; Director Gary Babin; Engineer Chris Cox; Line Foreman Gary D' Ambra and Financial Assistant Jacqueline Lee Light Commissioners Meeting The meeting was called to order at 7:00 PM followed by the Pledge of Allegiance. Chairman Aptowitz stated that there would be no Questions and Comments as there were no residents present in the audience. Chairman Aptowitz announced that on June 23, 2009 he and Attorney Leonard Kesten were in mediation with Kimberly Stoyle, Ms, Stoyle's attorney Lynn Leonard and Federal Court Judge Dein regarding the case involving Ms. Stoyle. The decision was made to settle Ms. Stoyle's lawsuit in the amount of $525,000, Chairman Aptowitz said that the Light Commissioners voted unanimously to accept the settlement and he believes it was a good decision for all. Attorney Kesten was present at the Light Commissioners meeting and thanked everyone involved for putting an end to this matter so that the Town can move forward. He reiterated what Chairman Aptowitz had said about this being the right decision. Attorney Kesten explained that $150,000 of the $525,000 settlement would be paid by the Town's insurance company and the remaining $375,000 would come out of Light Department funds. He noted that two years ago the Board wanted to put an end to the matter with a settlement of $900,000 but the settlement offer was rejected at that time. He believes that this settlement is in the Town's best interests. Clerk Baldwin noted that the current Board inherited this legal matter and she is pleased that they were able to settle it. She said that she voted in favor of the settlement so that the Town can move forward. Vice Chairman Moran stated that this was not a perfect ending but just a resolution which brings the matter to a close. Commissioner Dentino said that he did vote for the $525,000 figure but that he did it with reservations as there was no breakdown showing how the dollar amount was arrived at. He pointed out that if you use the $900,000 as a barometer then the $525,000 looks as if the Town made out well. He reiterated Clerk Baldwin's sentiment that this situation transpired during a previous Board's tenure. Motion: To approve the minutes of the June 8, 2009 Light Commissioners meeting (Moran/Dentino) Passes 3/0/1 (Baldwin abstained) h. .._'"~....,,~~_~.~_. , . Financial Statements for May 2009 - Director Babin reported that MMED's balance sheet is very strong and MMED is in a good financial position. Net operating income year-to-date through May was $2,700,912. MMED's balance sheet showed an operating cash balance of approximately $5 million. In regards to the Generation Charge, MMED owes the customers $176,000 through May. Director Babin also reported that energy sales are down 4% and the depreciation fund stands at $3.8 million. Director Babin said the Calpine fund shows a balance of $26,000 through May but as of today the money is gone. Commissioner Dentino noted that MMED has depleted the Calpine escrow account. He wondered how much MMED got out of Calpine and how much they paid Dominion. Director Babin indicated he would look at that issue. Commissioner Dentino questioned the Net Operating Income for FY 2009 YTD Actual of $2,700,912; FY 2009 YTD Budget of $1,538,328 and Prior Year Actual of $222,164. Director Babin explained that in FY08 MMED didn't book the under collection of the Generation Charge as an account receivable until the year end financial statements in June, which the auditors signed off on. Commissioner Dentino then questioned the Calpine Rate Stabilization Fund. Director Babin answered that as of December, MMED had not yet exhausted the fund and that all funds had now been expended. He pointed out that he has explained this before. Commissioner Dentino inquired as to why AlP decreased by $2,298,373. Director Babin said it represented the fact that 2 power bills had been processed in a single month so it was a timing issue. Commissioner Dentino asked what makes up the Administrative and General Expense of $657,611. Director Babin answered that the majority of the cost was legal fees. Commissioner Dentino wanted to know what occurred in Administrative-PayroIVBenefits. Director Babin indicated that Staff Accountant Thompson would have to follow up on that. Vice Chairman Moran asked if the dip in sales was in line with what MMED had forecasted. Director Babin answered that there had been a 4% reduction in sales and that MMED's forecast was a 1 % increase. He noted that this budget was put together in Fall 2007 and that this is what you are seeing industry wide. Chairman Aptowitz asked how collections were going. Director Babin responded that the collections efforts have increased for both residential and commercial accounts and those are in good shape. Chairman Aptowitz wanted to make sure that the Finance Committee is getting the same packet of information from MMED that the Board is receiving. Director Babin indicated that they are. Retail Rate Comparison of MMED Rates - Director Babin prepared a retail rate comparison for the month of June using 750 kWh, which is the usage for the average MMED residential customer. It showed a 26% decrease in that rate compared to June 2008. It also showed that 2 . Mansfield ranked in the top third for lowest rates in the month of June. Director Babin said MMED is in the top ten lowest rates for residential customers while commercial rates are middle of the pack. He believes MMED has worked hard for their customers. Chairman Aptowitz suggested that this rate comparison be posted on the MMED website. Vice Chairman Moran commented that this shows that MMED is more than competitive with surrounding communities. He noted that this is positive and that people should be made aware of it. Commissioner Dentino noted that in actuality the rates came down because MMED had to lower the Generation Charge due to the fact that they were previously overcharging their customers. Director Babin stated that MMED does not overcharge customers but rather, the cost for power is estimated then based on actual costs it is reconciled. It is submitted to the Board each quarter and the analysis shows the Board how the Generation Charge figure was arrived at. He asked that Commissioner Dentino not use the term overcharge as it is very misleading. He added that MMED also provides a mechanism for net income monies to be returned to the ratepayer by vote of the Board. Generation Charge for 3rd Quarter - Director Babin told the Board that the Generation Charge for the 3rd quarter will be reduced from 9.95 cents to 9.13 cents. Director Babin said that in 2008, the Canal Generating Unit charges were $2.3 million while in 2009 they are only $226,998, coming completely to an end as of July 3,2009. Commissioner Dentino wondered if there was any chance of getting any retroactive amounts. Director Babin indicated that would be addressed with the next agenda item. Vice Chairman Moran commented that with the unbundled rate the bill is clearer and easier for people to understand. Termination of Canal Generating Charges - Director Babin reiterated that as of July 3, 2009, MMED ratepayers will no longer be paying Canal Generating Station charges. He stated that MMED has paid $5,376,629 in charges for the out-of-merit operation of the Canal plant since January 1, 2006. He also stated that litigation was ongoing to try to recoup money from costs MMED had previously incurred. Commissioner Dentino inquired as to whether the Mirant plant was still being used. Director Babin answered that there were a lot of environmental issues associated with its continued operation. He said that it will probably be closed because it is no longer a source of income for Mirant. Commissioner Dentino asked if they were being paid to stand by. Director Babin said they would not be paid to stand by anymore because there's no longer a reliability issue for Cape Cod. East Mansfield Substation Update - Engineer Cox told the Board that an information request regarding the presence of rare species was sent to Natural Heritage and Endangered Species Program (NHESP). Their response was that there were three rare species that could possibly exist at the site of the proposed substation. The NHESP liaison also instructed MMED to continue filing and submitting plans to them for the MESA Project Review 3 , ---..."'- . Checklist, for which Mr. Cox submitted complete plans on June 25,2009. Engineer Cox said NHESP now has 60 days to respond. He suggested to the Board that an environmental consultant become involved at some point. Chairman Aptowitz inquired as to whether MMED would be ready to go to Fall Town Meeting to ask for bond issuance. Engineer Cox pointed out that MMED can only look 60 days out at this point as they don't know what the response from NHESP will be. Engineer Cox then reviewed the Cost Summary for the Proposed East Mansfield Substation as of June 30, 2009. In 2007, the total cost was $68,542 and in 2008, the total was $63,456. So far in 2009, the amount that has been spent is $97,692. Chairman Aptowitz asked for a ball park idea of staff time spent on the proposed substation in order to get a true cost of the project. Director Babin said that would be very difficult to do going back but that MMED would track it on a going forward basis. Vice Chairman Moran wondered ifMMED's plans would be accepted without the completed drainage plans or did the plans need to be complete. Engineer Cox said they were 95% complete which NHESP was fine with but that they did want to look at the 100% design plans before construction. Commissioner Dentino was concerned that MMED has to submit their Notice of Intent (NOl). Engineer Cox said they need to do additional soil borings first so they can get the storm water management report before submitting the NO!. Engineer Cox also explained that if you're filing for a permit on an existing right-of-way which is currently being mowed for maintenance then you don't have to file for an exemption, Commissioner Dentino said that's what he would like to see pursued. Commissioner Dentino then suggested hiring an environmental consultant. He commented that this project was already far behind schedule and that MMED couldn't afford further delays. Clerk Baldwin wondered if MMED would be ready for Fall Town Meeting as she said that the Board's sense at this time was that they would not be. Director Babin answered that she was probably right and that bonding authorization would not be requested at the Fall Town Meeting. Clerk Baldwin reiterated what Chairman Aptowitz had requested and that going forward the MMED staff keeps track of their time spent on the new substation. Director Babin indicated that they would. Mansfield Crossing Easement - Director Babin told the Board that there was an unusual circumstance regarding the Mansfield Crossing easement. The owners of the mall had modified the easement document without MMED's knowledge after MMED reviewed what it thought was the final version and then the owners recorded it at the Registry of Deeds. Director Babin said the mall owners had inserted some unacceptable language in the 4 document which needed to be removed. He said that Town Counsel had requested that the Board sign off on the new easement. Director Babin noted that this situation is exactly why MMED takes charge of the easement process and records the easements itself; to avoid situations where someone might again try to do what the Mall owners did. The Board, however, decided to defer the matter until the July 29 Selectmen's meeting. Ridgewood Landfill Gas Generating Project - Director Babin told the Board that MMWEC periodically looks at renewable projects. He explained that renewable resources are considered to be wind power, solar power, biomass and landfill gas. The State of Massachusetts is mandating a renewable portfolio standard of 4% of energy sales in 2009 which will increase by 1 % every year until 2020. Director Babin noted that these standards do not apply to municipals. In Johnston, Rhode Island at the Ridgewood Landfill Gas Project, they use the methane generated by the decomposition of trash and collect it to run a generator. There is a proposed expansion of this facility. MMWEC sent out the information regarding this project to its members just before the June Light Commissioners meeting which did not give Director Babin enough time to prepare and bring it to the June meeting. He told MMWEC he did not have enough time to get back to them by the June 29 deadline but that he would bring it to the Board at their July meeting. Director Babin said the Board would have to vote whether to enter into the project and that it is a legally binding contract with MMWEC. He explained that MMED would assume some of the costs of the project and that there were not a lot of front end costs. The commitment by MMWEC to the developer would not be required until the facility started to produce electricity. He reiterated that he had wanted to show the Board earlier but the original time frame just wasn't going to work. He added that he did not expect a vote this evening but was bringing it to the Board so they can see what types of projects are available. Vice Chairman Moran said he would like more information because of the Industrial Park customers and their search for green energy. He commented that MMWEC's project is less risky than other renewable energy sources. Commissioner Dentino wanted to know how much liability the Town would have and how much insurance would be required. He also wanted to know how much money up front was needed. He wondered how solid the company in Johnston is. Director Babin responded that there is no financial commitment up front and that the remainder of Commissioner Dentino's questions would be answered during the initial process. Old and New Business - Director Babin informed the Board that representatives from PLM, ENE and MMWEC would be attending the August 31 Light Commissioners meeting to submit proposals. He reminded the Board that the issue is whether MMED should opt out of its relationship with MMWEC this December. Commissioner Dentino requested that the Board members receive a line by line spreadsheet comparing proposals prior to the meeting. 5 ." Commissioner Dentino stated that there is no standing policy regarding ownership of secondary wires. He feels very strongly that the Board would be making a mistake if they accept responsibility for secondary conduit and duct banks. He suggested that the rest of the members think about it and he will bring it up again at a future meeting. Chairman Aptowitz asked if the bucket truck they had discussed at a previous meeting had been repaired. Line Foreman D'Ambra said it had not and that the truck for the FY10 budget had also not been ordered. Chairman Aptowitz stated that in regards to the MMED's engineer position and manager position, Commissioner Levine, who was not present at the meeting, left sealed envelopes containing her two votes. Chairman Aptowitz said that he had an issue with the envelopes and asked what the rest of the Board thought. He said that in a previous vote the Selectmen had taken on another issue, Commissioner Dentino had been allowed to leave a vote in a sealed envelope. Chairman Aptowitz explained that was different because the Board had met as a group and voted to allow Commissioner Dentino to do that. Chairman Aptowitz suggested that the Board discuss the issues of the engineer position and manager position this evening but hold the vote until all members were present at a meeting. Commissioner Dentino wondered how Commissioner Levine knew the engineer position and manager position would be brought up at this meeting. Director Babin responded that she must have known because the engineer issue had been deferred for the last three selectmen's meetings at which it was supposed to be discussed and that Chairman Aptowitz had slated discussion of the manager issue for this meeting. Chairman Aptowitz reminded the Board that he had asked at a previous Light Commissioners meeting for a job description of the engineer. Director Babin said he had brought it with him this evening and then distributed it to the Board members. In regards to the manager position of the Light Department, Chairman Aptowitz said that the Charter states that the Town Manager mayor may not be the Manager of the Light Department. Director Babin stated for the record that he had applied for the position of Light Department Manager. When asked, he added that if he were hired as the Manager there would no longer be a need to fill the Director's position. Clerk Baldwin pointed out that the search firm for the new Town Manager does ask the prospective candidates if they have an interest in also being the Light Plant Manager but that the Board had not discussed among themselves whether they wanted the new Town Manager to be the Light Plant manager. Chairman Aptowitz noted that MMED currently provides a stipend to the Town Manager when serving as Light Plant Manager and asked whether Director Babin would be looking for more money. Director Babin indicated yes, that he would want to discuss that. Vice Chairman Moran said that until they knew what was going on with the Town Manager position, he wouldn't feel comfortable making this decision. Commissioner Dentino agreed with Vice Chairman Moran. 6 Director Babin told the Board that in lieu of hiring a new Light Plant Manager, they needed to also appoint an Acting Light Plant Manager as part of their statutory obligation as Light Commissioners. He reminded the Board that the acting Town Manager Nick Riccio had made it very clear that he is not interested in serving as the Manager of the Light Department. Director Babin then stated that the Board was obligated to appoint someone to the position, acting or otherwise. Clerk Baldwin agreed that acting Town Manager Nick Riccio is in fact not interested in being Manager of the Light Department. She believes Director Babin is correct about the Board needing to appoint someone. Vice Chairman Moran said he would be okay with appointing someone for the interim but not permanently. Motion: To appoint Light Department Director Gary Babin interim, temporary Light Department Manager until the Board comes to a decision on the position of the Town Manager, for a period of up to three months (Baldwin/Moran) Passes 3/1 (Dentino against) Chairman Aptowitz asked Director Babin if he understood that this would be at his current rate of pay and would not include the stipend Town Manager D' Agostino had been receiving. Director Babin answered that he understood this and had no problem with it. Chairman Aptowitz then indicated he wanted to discuss the engineering position. Vice Chairman Moran said that he understood when the telephone vote was taken that the Board members were voting to advertise and hire for the position. He said that he supports filling the open position. Chairman Aptowitz then asked the Board how they wanted to proceed in regards to the votes in the envelopes which Commissioner Levine had left. Commissioner Dentino said he didn't care. Clerk Baldwin stated that she has two open meeting violation allegations against her and doesn't want a third. She reiterated that the Board had specifically voted to allow Commissioner Dentino to previously leave a vote in a sealed envelope. Vice Chairman Moran said that in theory, he believes if you're not present at a meeting then you don't get a vote. Chairman Aptowitz agreed with Vice Chairman Moran. Motion: To accept Commissioner Levine's votes for MMED's manager and engineer positions which she had submitted in sealed envelopes (Baldwin/Moran) Failed 2/2 (Dentino and Aptowitz against) Chairman Aptowitz then suggested that the matter be put on hold until the next Selectmen's meeting. Director Babin commented that he was frustrated with the continuing delay in dealing with the engineer position. Chairman Aptowitz stated that he can't control other people's schedules and that the situation with the envelopes was last minute and that he had a problem with it. 7 'II Chairman Aptowitz told the Board to e-mail Director Babin with any questions regarding tbe job description of the engineer that he had just distributed to them. Director Babin then said he would probably update the job description. Commissioner Dentino wondered how Director Babin could revise the engineer's job description. Director Babin responded that he was qualified to do so as the supervisor and he knows what their job is. He reiterated what a crucial position this is for MMED and that he wants the position filled. Commissioner Dentino then questioned how Director Babin could take it upon himself to revise a job description for a position in a bargaining unit. Director Babin said that job descriptions are at the discretion of management and that management writes job descriptions not unions. Commissioner Dentino reminded him that unions need to agree with the position descriptions. Director Babin did not agree with that. Motion: To adjourn the Light Commissioners meeting at 9:10 (Baldwin) Passes 4/0 Respectfully submitted: Jacqueline Lee 9/14/09 7td/0~ date of Appr val 8 ...