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HomeMy WebLinkAboutLIGHTCOMM MIN04052010 Mansfield Municipal Electric Department Minutes of Light Commissioners Meeting April 5, 2010 ') Present: Chairman Jess Aptowitz; Vice Chairman Kevin Moran; Clerk Ann Baldwin; Commissioner George Dentino; Director Gary Babin; Engineer Chris Cox; Staff Accountant Ken Thomson 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 then asked for a moment of silence for John Cooney, a resident of Mansfield who was being waked that evening. Motion: To approve the minutes of the March 1,2010 Light Commissioners meeting (BaldwinlMoran) Passes 4/0 Director's Report - Director Babin thanked Commissioner Baldwin, as well as Commissioner Levine, who was not in attendance, for their terms of service as Light Commissioners. Financial Report for February 2010 - Director Babin told the Board that net operating income year-to-date through February is $1,889,399 and that all major controllable operating expense accounts came in approximately $201,000 under budget. MMED's operating cash position through February 2010 was $5,108,442, not including an accounts receivable of $816,301 due to an undercollection of the generation charge. Year-to-date energy sales are down 5.3% because of cool summer weather. MMED's depreciation fund balance stands at $4,598,222. Director Babin said that soon the Board would be asked to discuss how the East Mansfield substation should be funded. Staff Accountant Thomson explained that MMED is $201,000 under budget for major controllable expenses which are the distribution expense, customer accounts expense and administration and general expense. This is mainly attributed to outside legal expenses which were $101,000 under budget and outside engineering which was $97,000 under budget. Staff Accountant Thomson stated that the customer accounts receivable balance is $40,000 lower than last year. He pointed out that it is lower because sales are down. Clerk Baldwin questioned the legal expenses being under budget. Director Babin explained that he thought that MMED would have been further along with the new substation at this point, which would involve legal costs. Vice Chairman Moran then questioned why the amount of AIR liens was up and wondered if it was because MMED did not have a standard practice of aggressively pursuing them a year ago. Director Babin answered that MMED has always been active with the lien process. - , I l (....r: 'V '. [- ""l Vice Chairman Moran noted that power sales are lagging. Based on how MMED's rates are constructed, he wondered how this would affect the rates. Director Babin said that if sales get too low, you have to determine whether you will make your net income target under current rates. He said that MMED is optimistic that sales will pick up but if they don't, the rates will have to be looked at for a possible adjustment. Commissioner Dentino questioned whether MMED provides the Municipal side with an energy forecast for their budget. Director Babin said they do not. They suggest to the schools or the library to assume similar usage to the past year and simply give them the projected Generation Charge rate. Director Babin said that part of the reason municipal sales are down is because of the number of streetlights turned off, which are included in the Municipal side's budget. Director Babin said that only half of the prior year's energy is being sold for streetlights because of budget constraints. Commissioner Dentino questioned the decrease in legal spending. Staff Accountant Thomson said that $134,000 was budgeted and $33,000 was actually spent. Commissioner Dentino suggested that the legal expense portion of the budget should be decreased. East Mansfield Substation - Director Babin said that MMED staff will be going to the Planning Board on April 7 for Site Plan review. He said that MMED will also be requesting a bond issue of up to $8 million at the Town Meeting. Director Babin told the Board that he met with the PinCom the previous week and has also been working with Treasurer Roxanne Donovan on a schedule for the borrowing. He then explained that if, for example, MMED borrows $4,000,000, it will cost the average customer $165 in out-of-pocket costs over the next 20 years, or a net present value of $106 today. Director Babin said that soon the Board will need to decide how much to borrow and how much of the depreciation fund to use. Director Babin told the Board that the current estimate for the project is between $8 million and $9 million. He said MMED is still working with National Grid on their transmission line construction issues. National Grid must receive Massachusetts DPU permission to construct the line. MMED hopes to have the new substation in service by the summer of2012. Commissioner Dentino questioned the bond as he thought it seemed high. Director Babin said he will be working with Treasurer Donovan on that. Engineer Cox then reviewed the site plan for the new substation for the Board. Chairman Aptowitz questioned MMED plantings on resident's property and wondered if the resident has to sign something because once it goes into the ground it becomes the property of the resident. He also wondered what the responsibility is if the resident decides to sell their home. Director Babin will look into that. Motion: To authorize the Town Meeting Warrant Article #4 for the $8 million bonding request. (Baldwin/Moran) Passes 4/0 2 Second Quarter 2010 Generation Charge - Director Babin told the Board that the 2nd quarter Generation Charge has been set at 11.47 cents, a 0.23 cent increase from the 1 st quarter. Commissioner Dentino questioned whether there is insurance in the instance there are problems with turbines, etc. at the generating units in which MMED has entitlements. Director Babin will inquire about that but he believes that there isn't. 2009 Massachusetts DPU Report - Director Babin stated that he had sent the DPU report to the Board members prior to the Board package to allow them sufficient time to review it before being asked to vote on it. The DPU report is a statistical summary of MMED's financial and physical assets and is based on calendar year 2009 information. He told the Board that the report needed to be approved by the Light Commission before submittal as they would be asked to sign it. Staff Accountant Thomson then reviewed portions of the report with the Board. Motion: To approve the Mansfield Municipal Light Plant's DPU report for submission to the Department of Public Utilities of Massachusetts for the year ended December 31, 2009 (Moran/Baldwin) Passes 4/0 2009 System Reliability Results-Director Babin gave a brief explanation of the reliability statistics SAIDI, SAIFI and CAIDI. He noted that MMED's criteria for measuring these indices include events that the DPU criteria does not include. He believes MMED's overall statistics are favorable and represent a reliable system. Engineer Cox reviewed Table 1- MMED Reliability Statistics Including All Events in the handout the Board received. He then reviewed the conclusions about MMED's 2009 reliability statistics. MMED has 7 reclosers which help to reduce the interruption time and the time it takes to restore a customer. It was noted that it only takes 1 significant outage to skew the outage statistics for the year. Also, about 40% of the outages in 2009 were due to squirrels. It was noted that MMED's aggressive capital program over the years has helped to increase reliability. Another conclusion is that the new substation will also have a positive impact on reliability. Old and New Business-Commissioner Baldwin thanked everyone as this was her last Light Commissioners meeting. Vice Chairman Moran asked about the response to the new electric bills. Director Babin answered that it was generally good but there is one problem which will require MMED staff to revisit the format of the bill. Although the remittance copy contains the information about the total amount due after discount, the portion of the bill that the customer keeps does not show the net amount due. This requires the customer to do the math so this will be changed. Vice Chairman Moran questioned how the flooding conditions the previous week had affected customers' service. He said his sump pump has been running since then. Director Babin said that MMED crews had to disconnect portions of the high voltage system at the Canoe River campground at the direction of the Fire Department. They also had to pull some meters at 3 homes because of water levels in the basement. He noted that luckily there were no heavy winds at that time, which usually cause the biggest problems for MMED. Vice Chairman Moran then thanked Commissioners Baldwin and Levine for all of their work and said it had been a pleasure serving with them. Commissioner Dentino agreed with Vice Chairman Moran's sentiment. He told Commissioner Baldwin it had been an enjoyable 3 years and said she would be missed. Commissioner Dentino questioned the working hours of the Light Department. Director Babin answered that the line crew works from 7:00 to 3:00 and that the office staff works 7.5 hours between the hours of7:00 and 5:00 on a flex time schedule. He stated that this schedule is contractual in nature. Commissioner Dentino commented that he doesn't think that having people on different schedules is administratively sound. Director Babin said that is how a flex time schedule works and it is in the collective bargaining unit contracts. Commissioner Dentino stated that he noticed on some time cards that employees who used to work 37.5 hours per week are now working closer to 40 hours per week and wondered if this was scheduled overtime. Director Babin said that there are instances when overtime may be necessary, such as when a billing schedule needs to be met or when board packets need to go out. He noted that anyone who earns comp time makes an effort to use it during that week so that they do not accrue too much. Commissioner Dentino asked how much comp time Director Babin has accrued. Director Babin believes about 160 hours but has no plans for using it. Commissioner Dentino questioned why he was accruing it if he didn't plan on using it. Director Babin said it was part of the agreement when he was hired that he was entitled to earn comp time so he does record it on his timesheet when he earns it. Chairman Aptowitz asked if an employee, who is supposed to work 37.5 hours and puts in for 40 hours on their timecard, receives their regular salary or do they earn 2.5 hours of comp time. Director Babin answered that the Professional Unit would receive comp time. Director Babin then explained that due to some ambiguity in the Financial Assistants' contract, he obtained a legal opinion from Attorney Mike Lehane to clarify the issue of comp time versus paying overtime. The opinion said that for overtime worked between 37.5 and 40 hours, the employee could choose whether they wanted the overtime payor comp time. For anything over 40 hours then the employee must take the pay. Commissioner Dentino said he was questioning why employees who used to work only 37.5 hours per week are now working more. He noted that this has become a weekly occurrence and is wondering the reason for this. He also said that he is a believer in overtime pay and not a believer of earning comp time. Clerk Baldwin asked whether Director Babin or Office Manager Laurie Anderson approves the Financial Assistant's time sheets. He said that he approves the overall payroll sheet and that the supervisors sign the timecards of the people who report directly to them and he signs the timecards of the supervisors. Clerk Baldwin questioned whether MMED had computer 4 software that enabled employees to clock in and out, much like a time card. Director Babin said they do not have that. Chairman Aptowitz asked if the office staff goes to their supervisor Laurie Anderson first to ask approval before working overtime or do they just do the work and put it on their time sheet. Director Babin said overtime is worked to complete necessary tasks on a timely basis with the supervisor's knowledge. The example he gave is that more employees will be staying until 8:00 PM on Wednesdays now that the moratorium on shutoffs is being lifted. Commissioner Dentino then questioned why that person would continue to start their work day at 7:00 AM or 7:30 AM knowing that you have to stay until 8:00 PM and overtime will kick in. He reiterated that if there is flex time, the person should adjust their start time accordingly so that there is no overtime involved, especially in this economy. Clerk Baldwin didn't believe they could make a motion to eliminate overtime but suggested a motion be made in regards to limiting overtime. Director Babin felt the Board should wait until Town Manager Ross was present as he is also the Manager of the Light Department and that Director Babin had summarized this issue for Manager Ross. Chairman Aptowitz agreed with Director Babin. Commissioner Dentino then questioned a side letter regarding comp time for the Financial Assistants as he did not believe the Financial Assistants contract entitled them to take comp time. Director Babin said it was an opinion letter from Attorney Lehane that was attached to a memo he had sent to Town Manager Ross. Director Babin then said that side letters are common for collective bargaining agreements where there is ambiguity in the contract language. Side letters resolve the issue and then the language is included the next time the contract is negotiated. Commissioner Dentino asked under whose authority Director Babin generated this side letter. Director Babin indicated that the authority had been delegated to him by Town Manager D' Agostino at the time. Director Babin reiterated that he believes Town Manager Ross needs to be present for this discussion and involved in this conversation. Commissioner Dentino said he would be more than happy to bring it up again. Commissioner Dentino then echoed Chairman Aptowitz's previous sentiments about the passing of John Cooney. He said he was fortunate enough to have met John Cooney who was always the first to make a very generous donation to any cause. Commissioner Dentino said he was a really nice guy and he will be sorely missed. Chairman Aptowitz wondered if MMED had gotten anywhere with the Board of Directors at MMWEC. Director Babin said the election occurs in May and he is nominated for a position on the Board. Chairman Aptowitz asked if it was possible to release the R.E. Brown audit. Director Babin said there is still a bit of work that is being done for that. Staff Accountant Thomson is actually doing the work and R.E. Brown will incorporate it into the audit. This addition to the audit is at the request of Jack Goldberg and the Audit Committee. 5 - Chairman Aptowitz set the next Light Commissioners meeting for Monday, May 17, 2010. He then wished Commissioners Baldwin and Levine all the best in their future endeavors. Director Babin announced that customers can no longer pay their electric bill on the Town web site due to a change MMED made with their billing company. He said there will be a message on the Town website alerting customers who want to pay their bill to go to the MMED web site instead. Commissioner Dentino asked if MMED had gone out to bid when they changed billing companies. Director Babin said it is considered a service so they did not bid it and that was fine with the auditors. Commissioner Dentino said that he did get feedback on the new bills, which was not positive. People have found it very confusing. He believes this is because there is too much information on the bill. Motion: To adjourn the Light Commissioners meeting at 8:55 (Baldwin) Respectfully SUbmitte..d: JaC~Lee.. 5/17/10 ~ SigftRtUre of Clerk 5"'- 2Lf - 20(0 Date of Approval 6 -