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HomeMy WebLinkAboutmin light commission 03/30/05 l- - ~ l' r -;r j!~ '~~ -~~ .,' . ".Ct IV"~" Mansfield Municipal Electric Department '~' FP!((,ci Minutes of Light Commissioners Mee~H.." .' .. , OFf'lCE March 30, 2005 '1 r I 3 A.u 8 f, . ~n: ~ 6 HAS~;'\ jr IEL Present: Chairman Roger Achille; Vice Chairman Louis P. Affi~~f.J3emie Dolan; Commissioner Steve MacCaffrie; Director Gary Babin; Engineer Ann tJangille; Line Foreman Gary D' Ambra; Financial Assistant Jacqueline Lee and Manager John D' Agostino Light Commissioners Meeting The meeting was called to order at 7 :30, followed by the Pledge of Allegiance. MMED Fiscal Year 2006 Capital Budget -Director Babin began by giving a brief overview of the Fiscal Year 2006 (July 2005-June 2006) Capital Budget. He stated that the Board was given copies of the capital budget in their Board package for the March 9, 2005 meeting for their review and that tonight they would be asked to vote on it. Director Babin explained this budget was for FY2006, the first time that MMED will have a fiscal year coincidental with the Town. On October 13, 2004, the Board voted to move MMED to the same fiscal year time frame (July - June) as the Town. r The total requested amount in the budget is $1,620,700 and this covers four major areas: (1) the rebuilding of the distribution circuits from Gilbert Street Substation (2) the continuation of the reconstruction of older areas where service problems arise (3) unanticipated and unforeseen proj ects (4) customer driven development work. Director Babin stated this budget was developed primarily by Engineer Langille and Foreman D' Arnbra. They project approximately 4,000 manhours will be needed to complete the capital plan, while approximately 3,000 manhours will be necessary to complete reimbursable customer projects which are anticipated. In the Cost Summary for Capital Improvement Projects detail sheets, projects are broken down in detail as either one-time projects, recurring projects, reimbursable customer projects or projects by plant account. Director Babin reported to the Board that there are two projects which need to be deferred from the FY05 Capital Budget to the FY06 Capital Budget and which have been included in the FY06 Capital Budget. The first project is for the upgrade of several small areas with new line construction. The primary reason for the deferral is that Verizon was requested to replace several poles by MMED, to accommodate the reconstruction work in 2004, but it is still not done. The areas where the projects will be done are the Verizon set area of town. Commissioner MacCaffrie said it was ludicrous that MMED is waiting on them to get the r project done, and pointed out that Verizon never gets things done in a timely manner. He suggested that MMED go after them legally, with letters, etc. He also suggested that . ~ r maybe it's time MMED should control all the poles and charge Verizon to have their wires on them. He cited the example when MMED employees sat in a truck at an accident scene for hours, waiting for Verizon to arrive. Commissioner MacCaffrie requested MMED find out when Verizon was requested to have their poles removed. Director Babin said he'd get him the information. The second project which will be deferred from FY05 to FY06 is the primary conduit installation on School St. from Old Elm St. to Plymouth St. Director Babin explained the staff has not had enough time to write specs, bid the project, award it and complete construction before June 30, 2005, which is when the FY05 budget period ends. The project will be completed during the 2005 construction season. In addition, Director Babin noted that there is an insufficient data base of information upon which to base the calculation of vehicle charges and that as a result, MMED staff is also requesting to remove the $31,410 of vehicle time allocated in the FY05 Capital Budget and expense those costs. ,,-... The deferral of these two projects will reduce the FY05 Capital Budget from $1,191,102 to $846,618. The staff will also request an increase in the FY05 Operating Budget from $12,205,448 to $12,228,946 to account for the labor that was included in the FY05 Capital Budget for the upgrade of several areas with new line construction, a project deferred to FY06, and that labor will now be expensed in the FY05 operating budget. Jim Lazzara from the FINCOMM was also in attendance and the Board asked for the FINCOMM's opinion of the FY06 MMED capital budget. Mr. Lazzara stated that the FINCOMM had met with Director Babin to review the budget and that they concurred with the methodology. He also said they were aware that this was early in the new budgeting process and that there would be changes in future budgets based on the lessons learned in these early budgets. Motion: To approve the decrease of the MMED 2005 Capital Budget from $1,191,102 to $846,618 due to the deferral of two projects to the FY 2006 Capital Budget and the expensing of vehicle time (MacCaffrie/Amoruso) Passes 4/0 Motion: To approve an increase in the MMED 2005 Operating Budget from $12,205,448 to $12,228,946 to reflect the reallocation of capital labor time to expense due to the deferral of the two projects (MacCaffrie/Amoruso) Passes 4/0 r- Clerk Dolan questioned the work to be done on the Route 106 reconstruction project involving the sidewalk and moving of the poles. He wondered why the facilities now on poles could not be put underground. Director Babin stated the rule of thumb is that the cost to go underground is approximately $1,000,000 per mile, and that this would involve not only the electric facilities, but all utilities, including telephone and cable, would have to go underground. Foreman D' Ambra explained there would be an enormous amount of r "I r work associated with reworking customer's electric services, as well as private property issues associated with the undergrounding work. Director Babin reiterated that FINCOMM was agreeable to the FY06 Capital Budget as presented by the MMED staff. He also pointed out that the FY06 MMED work plan will be affected in large part by the amount of reimbursable customer work MMED is required to undertake. One example is the Golden Triangle. Director Babin pointed out that depending on when the Golden Triangle project is approved, the developer will want to get going as soon as possible, and that MMED must comply with their schedule, within reason. Director Babin also stated that it's almost impossible to know what work will be approved for construction by the Planning Board during FY06 at this time. MMED currently has approximately 25 projects that the Planning Board shows at some stage of approval and depending on how those progress, this will dictate in large part how many reimbursable projects MMED must complete for developers in FY06. r Jim Lazzara and Jack Goldberg from the FINCOMM said they knew there were timing factors so they understood about the two project deferrals. They said they did question how MMED was handling depreciation on new assets, as previously the time frame of twenty years was being used for all assets. Director Babin explained that going forward MMED will be using what the useful life of the piece of equipment really is. The example he gave was that the estimated useful life of a truck would no longer be twenty years, but something more appropriate, like seven years. Mr. Lazzara and Mr. Goldberg said FINCOMM recommends that the Board approve the budget with the deferral of the two projects. Chairman Achille thanked FINCOMM for their hard work. Commissioner MacCaffrie wanted to know why the other Town departments couldn't have a budget formatted in the same way. He said he liked the concept of putting legitimacy to the manhours. Motion: To approve the MMED FY 2006 Capital Budget in the amount of $1,620,700 (Dolan/Amoruso) Passes 4/0 Questions and Comments George Dentino, 2 Gladiola Terrace, asked if the amount of the FY06 Capital Budget was $1,621,000. He also questioned MMED's load growth rate of 2.3% and if, in fact, it was two and a half times the state average? Director Babin corrected him by saying it was twice the average growth rate of New England. Director Babin added that it was also 30% higher than the growth rate of the combined MMWEC utilities. Both statistics were based on a load growth chart included in the FY06 Capital Budget. r- Mr. Dentino then questioned whether the amount of the Operating Budget was $12,928,000 and asked what last year's amount was. Chairman Achille inquired as to T" ... r whether Mr. Dentino had copies of the capital budget with these figures. Mr. Dentino said he did not. Chairman Achille suggested that now that the budget was approved by the Board, the information could be made available to Mr. Dentino. Mr. Dentino stated the Board approved the $12,000,000 for the operating budget and $1,621,000 for the capital budget and wondered how they were being financed. He asked where the revenues were coming from. Director Babin answered that the sources of funds were layed out in the Operating Budget. Mr. Dentino stated that when the operating budget was presented, he didn't remember the source of revenue being included. Director Babin stated that the projected total metered sales for FY05 (January through June 2005) contained in the operating budget was $13,679,187, net income was projected to be $822,253, and net increase to surplus after PILOT would be $582,253. Mr. Dentino asked how much came from the ratepayer. Director Babin answered $13,679,187 through the collection of rates. Chairman Achille then stated that a lot of hard work was put into this on the parts of Engineer Langille, Foreman D' Arnbra and the FINCOMM, and that the Board had every confidence in these numbers. He suggested that Mr. Dentino have a look at the documents and return to ask his questions. r Adjournment Motion: To adjourn the Light Commissioner's meeting at 8:00 Passes 4/0 Respectfully submitted: Jacqueline Lee 5/11/05 d~ r- r "I'