EWEB Board of Commissioners — June 7, 2022

0:01 seventh regular meeting of the eugene water electric board order the first agenda item is going to be the agenda check is there anybody that um is there anybody that has any changes or proposed changes to the agenda if not the next agenda items items from the board members of the general manager it was great to connect with people in the industry they're helping

0:46 with the work that we do so that we did attend the celebration of business that was also really it's a fantastic event i got to sit with one of the preferred citizens and it was just fantastic to be able to you know see what they're working on and where they're going and be there to encourage so i appreciate that opportunity and also had a number of meetings with elkhov elcog i'm also on the audit committee we just went through an rfp process to get a new auditor apparently the orders are in short supply so i don't know when we go through our process next

1:33 of selecting a new auditor but if that comes up here and then your turn then i've heard that that's a challenging prospect we only got one one contract or one applicant that's what i want to bring up which uh high school was the future for citizens sheldon i was just curious because a few years ago i was the future first citizen a few years ago like a long time ago this is a fun event i'll just say that it is

2:20 nothing for me thank you did we get uh commissioner mccray back online you get a call in or uh okay you're working on it okay i'll go back to him when we go but i want to keep going so we can uh item is a public input and we do have one individual that's signed up to speak before i open the public input i'll uh i'll read the uh public input actually i'll open the import you know let's say when your name is called please come in and state your name obviously your address or award speaker will be offered three minutes to present their testimony keep track of time by watching the timers in front of

3:05 the room or by by listening for an audio notification when three minutes is the last if you're busy competing by telephone remember to view your call press star six calling from the landline or simply use the unview button calling from cell phone testimony is heard each commissioner will have an opportunity to speak if they choose although by policy we do not want the agent back please note that the failure requirements are speaking it cannot be construed as support of or opposition to any speaker's testimony as presented by a speaker will not want to answer an e-what staff member will contact the speakers first speaker i have this evening is twilight jacobson followed by uh shepard just for the record and is there anybody on the phone

3:50 twilight all right thank you thank you president brown vice president counseling commissioners my name is twyla jacobson i live in ward 2. thank you john borowski if he's somewhere for your service i'm the co-chair of the cs service employees international union 503 climate justice committee and president of the state retiree local but i'm here tonight i'm speaking for myself i'm pleased to say that my electrical use was covered with a little bit of on the positive side with solar panels on my home for the past due gray and cloudy months which surprised me i was very supportive and i'm very supportive of the efforts that aid web is making towards green

4:35 options as stated in your website as an e-web customer you're already using clean renewable energy and investing in mckinsey watershed protection but together we can do more so i am here this evening to ask that he would do more energy is not green or renewable if it leads to the extinction of the iconic species here in the pacific northwest are examined tribal nations rely on salmon for food cultural practices in their very existence and nest purse leader has stated there are no nez perce if there are no fish north america's largest pacific watershed the columbia river basin hydropower dams have been controversial because of their disastrous impact on salmon and the other 137 species that are part of the salmon food chain

5:21 most of the columbia bases 250 plus dams have played roles in the salmon's decline but the four lower snake river dams are prime targets for removal because their economic value has diminished and their absence would inordinately benefit sam last fall the biden administration announced the long-running litigation where the nest purse tribe has sued the federal government which includes the state of oregon and a coalition of environmental and fishing groups as plaintiffs would be passed while the two sides seek long-term solutions senator murray and governor inslee of washington committed to develop and deliver a comprehensive solution to protect and recover snake river salmon and invest in the region's communities by july 31st

6:07 2022 this year and i think e-web can be a positive force for helping bpa the bonneville power authority modernize their system the dams and their energy can be replaced utilities everywhere are replacing aging generation with new renewables federal infrastructure funds can be used now to build new energy and it will also free up 144 miles of prime recreational site in idaho as well as help coastal fisheries whale watching and shore based businesses throughout our region last year the nest purse analysis by their department of fisheries resource management found 42 percent of wild snake river spring chinook populations and 19 percent of wild steelhead are

6:53 tipping toward the extinction we are at a crisis state with salmon recovery tribal chairman penny said of the nest purse i ask that you as e-web commissioners represent the public act as ambassadors for embracing a future that includes climate justice as well as the rights of future generations to a place that supports all life systems we do not want to be the ones who will go down in history as those who did not act not on our watch thank you thank you the next speaker is thomas shepard hey people it's me go chick otherwise known as uh tana shepard from b web um

7:38 eugene edge uh fort smith let me start again not really i'm just from eugene 4j's education partnership i'm a grant coordinator this is my fifth year in the role um and i went and i just want to thank you as always for continuing to support the funding of our dynamic and meaningful educational partnership um this year is a year three of unknowns and so just kind of weathering through that um you know being adapting to new ways of doing things and um you know basically what i've learned over the last couple years of where what teachers actually need right now from our program um i also just want to share i've been playing solo since october without an assistant that we've just hired an assistant in 4j so we should be a little

8:24 more balanced than just me doing everything because i'm not a financial person um so again this year i was compelled to serve my in my role differently i think this is kind of how things are going to start being but learning just by listening to the teachers and supporting them i've had a lot of teachers just reach out individually like what do you think of this can you help with that and so it's just been a lot more on the spot not the big project still too but more individual projects that are actually sparking a lot of ideas especially around water education so our program is a lifeline and a beacon of light for many of the teachers this year while direct student connections have been less than typical i'm managing to get into quite a few classrooms and um

9:09 actually online learning as well through zoom and teachers as i mentioned are reaching out to utilize all the offerings and and really just my expertise and so some highlights of ben's wonder wanders which is new but just taking kids and getting them outside and wandering around and noticing and wondering and talking about it um water is life mural so some art out there a lot of i've been helping with a lot of walking field trips because we haven't been able to have any volunteers so i've been like the tried and true let's get the kids outside um and then the wind energy has really taken off this year as well as our newly rebranded ev challenge so this week many of the teachers i have all seven out of the eight middle schools participating which is a record and so the challenges are site-based and

9:55 they're happening starting tomorrow and i'll be attending all of those events in the schools e-web will be out on thursday at kelley middle school to bring communications out and so hopefully there will be some great footage and shots from that and i'll make sure and share anything that i capture and um yeah so we're kind of just scaring up for the end of the year and thinking into fall and so really hoping to bring salmon tanks back into the classrooms but it has been requested that i continue the virtual aspect especially for online learners they've really gotten a lot out of that um i've had actually people across the state utilizing that so not just for daily people so anyway i just want to thank you again

10:40 and yeah and it's good work so thank you thank you anybody else signed up or on the line all right well then i will close in public input and call for comments from thank you for coming out and and expressing your views and and i i'm very curious to hear about um how teachers if they want the programs more if you're saying kind of a pushback it's just a change in how they are operating so at some point if you have some time i'd love to hear more about that and thank you to tyler for your information and expressing your views thanks

11:27 the comments from commissioners i'd like to thank both of you twyla i'm very very uh involved in both making sure we have an adequate energy supply and how we replace it with clean renewable energy but also protecting the salmon too so we just we all had an option of ice harbor but the logistics are brutal it's six hours each way and uh it was it was a tough deal to do but i'm keeping track of what happens with the state trip comes because i'm kind of torn between multiple things but i will say that you know the salmon are stressed not only by the dams but i mean just this year they closed with cyrus law and they've limited all the salmon fishing on the coastal streams because it's the ocean is causing a heck of a lot of this problem too so it's not just the dances but the dams are an integral

12:13 part but thank you very much for bringing that to our attention and donna thank you very much for coming again when all your programs were on the chopping block and when we had them all out of the budget it's the first time in my life i've ever seen the superintendent of every school district that we funded at that podium saying please don't do that and for you coming and telling us it's very rare to have somebody that we supplement this program you come and say tell us what we do so i really appreciate you coming and saying telling us what you're doing and keeping a surprise even if it's quarterly or whether semi-annually or whatever it really helps and it helps keep us informed and stressing the importance of what you do so thank you very much okay i just wanted to make note and this is this is for

12:58 twilight as some others i i do know that the city club of eugene and the end of july i believe is going to have a discussion a panel discussion around the snake river dams so we'll make sure we get that event posted on our calendar on our website i know i know all the speakers personally so it should be an interesting discussion um and then hannah one of the things that's come up with the board this isn't supposed to be a dialogue but there's only two of them and i break through that rule all the time so i'll break the rule you don't have i know that this board has brought up in the past funding for private schools and also home school one of the things that i'd like to have staff or for me get together with you on

13:44 is your virtual options and how we can make that available to others it sounds like you're already doing that but maybe there's some things that we can do to facilitate that totally and i guess just in light of what funny was asking too maybe there's a time that we can just kind of catch up and not in this format to just kind of be able to talk about it that'd be great i invite that right yeah look forward to that thank you okay we'll move on um the next agenda item is approval of the consent calendar consecutive calendar we get mcrae back here that's too working they're working thanks let me know when you're getting back up hey would anybody like to make a motion to calendar a no move across

14:38 passes unanimously but no note that commissioner mccray is has been in attendance but didn't vote on this but still those in attendance have been passed unanimously agenda item is a brutal consent calendar b motion to adopt the carlson seconded by schlossberg sessions next agenda item moving right along is the annual capital improvement plan frank and rod bank lawson price i'm sorry

15:49 so president brown commissioners good evening for the record frank lawson general manager with me this evening is rod price assistant general manager tyler nice electric division manager and wally mccullough the water engineering supervisor we have a few things to go through with you this evening um kind of dividing this up into two presentations and so what we're going to do is to run through a number of the different assumptions around capital planning we have a number of things to talk about this month and next month relative to the opportunities for investments that we see and so the first presentation i'll give you a little bit of background about what drove the plan um what drove the president plan that

16:34 we're executing we'll then have wally and tyler provide the board with an update on the project so where are we with what you all approved last summer and then ron and and myself will kind of recap and assess kind of where we are from a macro level and some of the trends that we're starting to see relative to capital investments this is if you're familiar with uh plan do check act uh parts of continuous improvement what we're really looking at over the next couple of months again this month we're going to kind of run through the here's here's what drove us here's where we are here's the projects we're executing

17:20 here's some of the trends that we're seeing and then next month we're going to propose some adjustments to our investment strategies as well as our long-term financial plans that will take us forward so we're we're presently executing the the 2022 through 2031 plan it seems odd that we're already into the 2030s and then july you will start to get your first divisions of the 2023 through 2032 long-term financial plan as well as investment plans for for our discussion really right now the the board is an integral part of what we do relative to the strategies that you develop we're really talking about the

18:05 the green area here the relationship between the guidance and the assumptions that that you instruct us on the policies the the strategy and then we have this this back and forth interaction between the investments we're making relative to capital plans a lot of those driven by things like master plans and ierps and other things and then those interact with our financial assumptions what's going on in the outside world and also eventually developing into a model that we project out for them at least the next decade with the finance team deborah hart and her team to really get into this is this is what this looks like for the utility for the

18:50 next decade we roll that back out to the right side of this this diagram which is then we start to look at what are the revenue requirements uh what is what's the cosa start to look like to where we eventually end up with customer rates and so several opportunities for the board to provide guidance including in the process that we're in last year some of the results when we sat down with the board was we wanted to make sure we were making the right investments and we were doing it in a way that would be acceptable to our customers from a financial perspective going forward where we landed was that the board instructed us that it was it was pretty fair to look going forward at benchmarking our rates

19:36 relative to inflation that was 2.1 to 2.9 percent uh as we know inflation is is um in a bit of a fluctuation at the moment um and so we're not anticipating um doing you know long-term rates consistent with that level of inflation but we also landed on an investment plan on the water utility north of 300 million and on the electric utility just north of 450 million and so those were investments that were planned out over the next decade and the result of that was within the board guidance so on the on the water side 2.73 the exception was the second water treatment plant which which put the

20:21 average rate increase at 4.8 and then on the electric it was 2.53 i won't talk about some of the refinements we're looking at rod run i'll talk about those a little bit later but we are starting to see impacts of things like supply chains these are things that we may use we manage them all the time and we'll talk about some of the adjustments that we want to make going forward relative to emerging trends and not issues you to read this um basically what we what we were trying to show here last year the financial plan was within board metrics it was within the policies there were some yellow areas here and there actually on the upper plan as well spotty in the outer years and those were where we were within uh 10

21:07 of the the target metric so we we hadn't we weren't in the red but we were able to find a way to facilitate the investments that we proposed for both water and electric and do that within the guidelines that the board had given us resulted in some rates rates that actually kept us in pretty good comparator position if you recall last fall was also the first year that we looked at a multi-year cosa so we've actually projected out doing some smoothing over a three-year period and uh we'll provide uh some some general updates to the to where that's going to take us in the long term financial plan starting next month but then we'll get in and verify

21:54 where these numbers are headed and you can see we're pretty still in pretty good shape relative to our comparators water even with the investment in a second treatment plant went from the second most affordable to the fourth most affordable relative to our comparators but even with a large investment with that um i will turn it over to wally and tyler to let you know where we are with some of these investment projects um some pretty exciting ones and tyler and i are going to be uh just giving you an update on capital we can start with kind of doing a kind of

22:39 quick recap of 2021 and look at what's going on in 2022 and then an overview of the next 10 years i'm going to start first with the water side of things and uh in good first looking at 2021 we had a great year last year in water our capital investments pretty much equaled our capital budget a tremendous amount of work done last year big projects where our riverfront transmission made from headquarters down over toward the knickerbocker bridge we completed the second phase of that that's going in the picture on the left as we're heading up kind of turn south go underneath the railroad tracks heading to

23:24 underneath the railroad bridge into a ufo toward franklin boulevard we completed the excavation at our east 40th reservoir which is the biggest project we have on our capital plan currently and several of you who have been into the site there last year so it's proceeding well uh ami we had everything we were hoping for last year a lot of capital expenditures on that as well as um a lot of material participants helped us start of this year main replacements we made all our goals and we've lost all some lots of smaller projects everything was clicking last year so it was good um you know moving into this year we are seeing some supply chain issues

24:10 affecting some of our projects ami is one that got hit pretty hard with the supply chain little modules go on top of meters to communicate out you know i think we can't get them dr but we're working on it but we are down you know we're down to about 90 to 100 a week compared to 250 to 300 a week you know in our peak last year so we're hoping that's going to come up and those supply chain issues along with some of our contractual timing and we have our reservoirs for half of our capital plan a 40 and it's a two-year contract and there's a couple swinging and contract timing swings are over with that

24:55 as far as equations so we're probably going to be around 80 or something but we're keeping an eye on that notable projects for 2022 would be again the reservoir project um the consent item was just approved had our water system control upgrades and we're really excited about and working toward for a long time on the water side a couple of projects up at hayden bridge this year's outer activated carbon improvement system to help get water quality to electrical work on our finished water pump station which all the water in the eugene goes through that one 24 7 operation so exciting project there and then some up river projects pump stations and again remains we're looking pretty good

25:40 this year on main replacements there was another main replacement on the consent item tonight and we'll see probably one or at least maybe two again later on this year going to the board for improvement i'm going to kind of go into the 10 years you know we have all our normal work which is kind of the small stuff um that kind of is fairly consistent every year it's all our compulsory work services work developer work our main replacements which is probably the largest part of our type 1 work pump stations upper level reservoir projects we have that and it really didn't change much from the past

26:25 plus we have our larger projects and i have some slides on each of these the base level reservoirs transmission and second source and really the um our proposed 10-year cip is really the same as last year what we're proposing this year both in terms of projects and amount dollar amount pretty much the same we're still following our master plan you know we're building our resilient spine we started 10 or 12 years ago with hayden bridge went through that i said this numerous times to the board went through that now we're moving into base level reservoirs and transmission so we're in in that a couple years now that's that's the plan going forward first five years the cip is a little bit higher than the second five just

27:11 i really do there's some second source money coming another year second source money coming into the plan and that lump in the oatmeal or whatever franklin likes to say um we are redoing um our master plan in 2025 and our cip is really based on our master plan and we redo that every 10 years i don't see a lot of changes in big projects and direction of those with the master plan of date but it could affect some of our smaller type 1 projects and where we're going in some of our south hills areas so but or we'll be seeing something on that by 23 24 there'll be some involvement for some communications on our master plan

27:57 getting into some of the project specifics um the biggest item in our 10-year cip is our second source on the lamb river um construction and the proposed cip is 25 to 28. i did shift some money out into 28 added another year on to that and took some money up front because we are a little bit behind where we'd like to be as far as approvals and getting that going areas that we're really working on there this year we're doing land use approvals we've got a report session with the city of springfield um that'll hopefully give us some direction on what properties and you know where we're going and what will it take to get there

28:42 permitting we're getting some consultants on board just to get in our back pockets we can kind of hit the ground running when when we get those approvals and you know what exactly we're going to be building and where and then we'll be doing some value engineering on some are particularly the intake this year just where we can save some money on that getting ready we know what we're doing take off next biggest item on our capital plan in the ten years i've distributed storage um we have six base level reservoirs we just planned in the ten years we got that includes the two at east 40th which is underway and moving to hawkins and college hill

29:31 i think we have a pretty good handle on this program you know and what we're really working on we want to make sure we do a good job at east 40th and be a good neighbor all these projects are in neighborhoods and it just takes a few bad stories to um sing things so we want to make sure we're successful and being a good neighbor consistency in communications we have a really solid communications team on this our east 40th project we're going to just keep that going um and then our cip kind of we had some gap years kind of closed up just to maintain the work so it just doesn't stop and start and a lot of us related just keeping continuity in the communications on that

30:17 the last time i was going to talk last time i want to talk about is you know pipes in the ground that's our main replacements and our transmission projects the remains you know we consider those those are the small pipes that hook up to everybody's house these are on the right most of them are eight inch diameter but generally anything under 24 we consider a main replacement um the 10-year plan has an increasing investment in major investments we're really looking to increase mileage of pipes in the ground kind of lowering some of our kpi's on that we're right on the threshold as far as breaks per mile so we're doubling the expenditures on that over the next 10 years and then as far as our large pipes these

31:02 are like our transmission beam we have eight of those in the ten year plan some of those are associated with reservoirs we're timing one for east 40th it's time with the city street rebuild the hilliard we have a big project uh third phase of our connector along the riverfront is being timed with the uh for 2024 and 2025 and the uh cip and that's time with the city rebuild at franklin a lot of coordination there you know on areas of kind of work and concern we have here really that this is where our supply and chain issues were like this those are our main replacements and there's a lot of creative material procurement i'll call it buying materials ahead of time buying lots of

31:48 pipe um when's on the line here somewhere we're shaking this head is how many times we ask them can we put more pipe here you move a vehicle put one pipe so working on that and then also labor resources it's a lot of divisions that take for maine replacement work covers everything from engineering obviously construction crews but warehouse fleet purchasing just as we can increase expenditures in that program making sure we have the resources to complete our plan there's some additional activity in the long-term plan be proposed in july i'm going to turn it over to tyler thank you

32:33 would you remind her i have potential in this picture a little action to the presentation okay i almost need a big mirror so we can see what's behind us always a surprise uh so tyler nice the electric division manager for the record i really appreciate the time tonight for electric similar to wall-e gonna look backward to where we came from look at this year and then look it to the future uh for 2021 i'd classified as a great year as well for electric uh we spent 85 percent of the investment we intended to on the infrastructure and you know amongst all the challenges all the groups had with supply chain and staffing and all the buzzwords you hear uh i think that was really really great job for the teams i didn't draw a

33:18 highlight in this bullet on 100 close to for electric only efforts what that is referring to is not that electric division staff only worked on that but things that that we're putting money into that are carrying power delivering power to customers or producing power of the plants uh those types of projects we've been performing really well on when we look back the last five years we're usually right around that 100 percent mark i like wally noted with the large strategic projects they might bump year to year and that's okay but uh some of this infrastructure work is really we're spending really accurately on it so part of that as well for the teams notable projects i'll really just hit the ones in the pictures through this but ask me about any of the other bullets uh the fema storm mitigation is the one on the right there with a couple line trucks that's down in

34:03 south eugene saratoga neighborhood that was actually from our 2016 storm we got approval for that finished it up last year and this project was or this picture was over a couple days when we had all the crews out in that neighborhood and they after all the underground was installed it was an overhead underground replacement and they were moving all the overhead opening up the skyline getting things out of people's backyards really cool to see everybody out there doing that and great for that system in the area so some of that funding getting getting put for future storms and mitigation so it's great uh moving into 2022 projects this year uh seems like we're almost the end of it but uh for this year's projects we're looking at a 70 spend really the two bullets there uh supply chain issues and

34:50 carmen smith delays the supply chain uh for electric focused on um electric materials mainly cable and transformers we're needing to uh they're in short supply and and lead times have jumped up but we are being as well we talked about uh kudos to purchasing in kudos to especially distribution engineering and operations uh you know we're looking at different design ways of uh that we're actually refurbishing some units to maintain some stock uh we're looking at alternate supply so really really proud of the teams they're the ones that are seeing the customers some of this has resulted in customer delays for some work uh as of late so they're the ones managing that so even with that we're still able to prioritize and move work along um notable projects the one on the left

35:36 is a is a picture of the ip transmission loop restoration that first one it was a spooky day on october 30th last year a day before halloween much spookier than halloween because we did have that loop go down uh something that does not happen on that loop very often it was a fault on a pilot wire which is a communication wire what we did is we found ourselves a big capital project in our lab again really proud of the teams substation relay a lot of the line departments and engineering as well we did get that back in place last a couple weeks ago picture on the left is another gift throughout that project that was a emergent breaker replacement in the middle based on testing when we were commissioning so

36:22 lots of good things in that project lots of hurdles to overcome the kind of thing i'd state about that one that delayed a lot of our other capital work uh into this year to assess that being being our number one customer and connection up river and verdict so next slide uh on the 10-year piece uh our normal work that's kind of our type one work renewal and replacement we call it a lot of ways services and compulsory projects that it's our obligation to serve also wrapped into that is kind of emergent replacements we need to restore um really what we're doing is turning up the dials increasing investment on some of that equipment i was talking about that we've been investing in cables uh you know transformers poles all that infrastructure that delivers delivers the power especially substations and

37:08 transmission as well picture on the lower left is an example of that that's our alvida current line uh we used to have a competition about who had the biggest crane in photos but this one's pretty big that was replacing insulators on the uh on the line for two reasons one age and one preparation for a large substation project coming up to ensure the reliability is there it was a really great piece of work to get out of the way line department uh the one on the right that picture is actually uh gotta thank you and the board wrapped in there we did do a pro approval last year for transformers if you may remember that you approved this was a failed transformer that happened last year at cal young and this is some of the doing something unheard of and showing people in this presentation but it's uh the teams that that work in the

37:53 substations and scope this out so this is like a team out scoping the workout for the replacement of that transformer we're doing that later this year we received those units earlier this year so excited to get that that back in place uh to reduce any system contingencies uh long-term strategic investments that's our type two if you remember uh really in the plan has woven in 14 substation rebuilds uh that's the number that's beyond or or beyond or at or very close to end of life as we've assessed with our data and and uh condition we're also focusing on resilient spine within there that's this list of substations i'll talk about a little later that can really connects our central hub of eugene to the up river and maintains our

38:38 our customer load and also like i said before the just the power carrying equipment transmission distribution some of the overhead transmission replacements but also we'll have in there a cable replacement plane that'll add about 15 000 feet of cable replacements a year electric ami is one to note we did have a classified severe supply chain issue with that just no meters so we have halted that this year uh so we can maintain stock for new connections replacements we're about 71 percent deployed right now and uh fingers crossed when we get those early next year we'll be back on track we're engaging with the contractor this year and be ready to take off uh in 2023 for completion in 2024. moving on to generation uh same same

39:24 grouping type one two and three type one similar to the electric side and water side ongoing replacements to maintain condition and age of the equipment at the various plants in the in the dam facilities also type 2 really one one piece and there's a turbine generator overhaul that unit's going to be due it's getting some work this year next on the on the kind of switchgear side of it but for the turbine generator keeping that resource reliable is going to be very important and then carmen smith improvements that's spread throughout the plan still first five years really is focused on finishing out a lot of that uh infrastructure work in the plants and renewal and then starting up the kind of fisheries recreation and then finishing out everything in the last half of the plan something that's been on the on the

40:09 budget for a long time and we are seeing lots of progress too that's what kudos to the generation folks also notable uh zero aware big big decision this year for the lieberg and options analysis what to do with that right now what we have is the 20 million dollar placeholder in there and really what that is for is to account for any internal measures we might have to take um that might evolve uh later this year we'll have a decision from the board with input from staff on that and we'll update the plan and the modeling and everything with updated costs later on the 10-year overall really we have the the same scope and goals it has increased in cost due to inflation and some of the estimates that have come in on the larger suites of work

40:54 type one really the goal is to establish a lot of uh asset replacement programs we haven't been able to fund kind of programmatic replacement of things of different equipment we're really going to be looking at these metrics and tuning those to maintain a reliability that's things like line miles number of number of transformers number of breakers replaced and then looking at age type 2 is really focused on enhancing resilience for the highest impact loads i'll talk a little about those later but but and also the the risk-based rebuilds looking at not just not just the age but also the risk of it to the community to the to the customer base um and then we have some emerging trends there and there's some of them we've been living for a while with some of them that um are coming so

41:41 safety is one as we talked about with lieber wildfires one that we'll be talking more about the next board session and in coming that we've woven investments into that that are communicating increasing telemetry and reducing risk of wildfire for uh customers in the web electrification is one that that we don't have woven in the plan as of yet but we're in close contact with the power planting folks we have really good capacity on the transmission and substation level but but as we move forward and get more data analytics understand the impacts of that as as policies and our data roll in we'll be looking more into the distribution system and injecting that in as we get more info and then one we don't want to forget about not the news as much anymore but subduction zone earthquake that one we have effectively put into

42:26 our processes for especially substations and generating facilities seismically rating um new installations and retrofitting some another so um and then type three as i said continuing on with the re-licensing work a little graphical representation a map of the system here and really what this box around it is is highlighting that that resilient spine as we call it it really connects a suite of our main hub to the system with bpa connects the step river connects us to the water plant and really you know as i talked about 14 over 38 substations and this is kind of the order of them that they would roll out in across the system um and we're focusing on the resilient spine first a little focus on that what

43:11 do we mean when we mean risk well risk equals probability times impact and so uh for us the probabilities driven by condition of equipment age of equipment outage history ops experience that kind of gives us an indication of how likely something is to fail impact is more you know not just customer count but that is an important one but also customer impact uh both the community and the system and then uh really the main risk in our plan and and that we're managing to is is what happens if one of these things pop before we get to substation or breaker or generating plant x in seven years and it's really these uh increasing some of our spare stock especially with supply chain making sure we have things on hand ordering early and timely we may have to go and do

43:57 you know interim uh repairs or upgrades you know like if you want to go rehab your kitchen you might have your faucet break before you're ready you might have to do a little tweak in there so we may find ourselves doing things like that and coming back later and really prioritizing that on risk and uh another unthinkable thing showing the water plant in my electric presentation but uh resilient spine that's one of the main pieces of the spine is uh we have international paper on that loop current substation that's the intersection of i-5 and 126. large substation off to the right there if you're going towards the mckenzie and you look at it every time and then hayden bridge and then up river of course we also have support shared services in the plan and really the things this year uh and in the next few years we're

44:43 focusing on headquarters sale preparation to me this year as you know is for sale right now lots of infrastructure work but also logistics that we're handling and then also expansion here at the rock bertelson property and uh really that's in the design and planning focus on resiliency flexibility and you'll know you have some correspondence on that but uh also see some construction happening there and then fleet we need equipment and trucks to do our work and those are as you see littered throughout to to make sure we get in to be able to achieve this work that really thankful for that and another exciting project that i'm going to pass to rod is uh that we're excited about is our ees project excuse me so good evening commissioners and everybody in virtual land um

45:30 this is a really exciting project for you with we can't hook a crane to it so i can't put a printing picture on this unfortunately but um this is foundational to to the future of how we do business in our work and it's really going to transform the entire utility and we've got a lot of people working on it there's a lot of enthusiasm and excitement about it we're in the rfp's rfp stage right now evaluating some some contenders for for some of the software and the product behind it everything's going really uh really well to schedule it does the capital plan for sure it's it's a multi-year project um but things are going really well on it i think you'll expect to see travis here in all set

46:20 probably the the system integrator so i got to get the tail end in the last project so we're going to pause right here for any comments questions and discussions first i'd like to say but we had this is information only we had 30 minutes scheduled we used 30 minutes for the presentation so we're going to keep going way ahead of schedule uh on on on that so if there's questions or comments uh because we have capital improvement planning and project update two and that asks for direction so yeah i was just going to point out that the way that this was split it was a little bit funky that'll be a lot shorter presentation so fine so anyhow anybody have any questions or comments before we uh technically we

47:05 have we're scheduled for a break but we're 30 minutes ahead so if you want to keep going we can so people have questions or comments on what we've seen so far on the the pipes and the transmissions transmission line i don't remember where kpi is for the how old the system is kind of average age of the system versus where we're at our average age we're actually a pretty young system on our distribution mains and we're right around 40 years similar vintage i don't have the aegis system metric but i do know on transmission we're behind right now but it is same similar build out of that

47:52 timing when all the substations were built the city was building okay um on the east 40th project can you remind me of the timing where we're supposed to be at and are there any supply chain issues um there's there's minor supply chain issues with some piping and things but it's long enough anytime it's not affecting the project we're going to be in operation by next july the current plan it will take about six months to wrap up the whole project so hopefully wrap up 95 of it by the end of 20. and my last question uh what is the laundry oh telemetry like getting data from

48:39 somewhere else back to your dispatch up i think that was i was talking about wildfire for example companies are looking into increasing their data gathering from weather stations or partnerships so that's that's one thing we're trying to do other questions or comments john b thank you um so just a question on this process going forward in other cips that i've dealt with with other agencies we would get a project by project list with funding identified funding to be identified these types of things that's something that we'll be looking for will it be broken down

49:24 you know this this transformer is scheduled for 2024 and it's cost us this much or is that not the type of detail that we'll be seeing so um commissioner barofsky there the different classes of projects that were mentioned a type 1 project you would not see a project by project breakdown a lot of that is a routine basis you know we have 22 000 distribution transformers in the system for example and we're not specifically identifying which one so type 1 project generally go off of metrics at i'll call it a bulk level

50:10 the type 2 projects you will see in the capital planning process the schedule and the cost estimates on on a project or program by by program or project by project basis you'll see that at the type 2 level and the type 3 level so it's a combination of both of those okay and then one other question when when you showed the map with the substations that we're going to get get read done because the large street substation on that because i've got i've got constituents that are complaining about the noise from that substation uh i talked to rod about it and i didn't walk around and just wondering if that

50:55 is i mean if it's the number one the one that says number 12 on it what time frame would the 12th substation get replaced that one is later in the plan but that one we are looking at uh we are doing a study on the sound analysis of that station right now okay yeah i just i saw i saw the number 12 there and i just i'm glad that you're looking at some other sorts of medication possibly before the actual replacement but it is on the list to be replaced is that right yes thank you um just a clarification from mr nice um new does does new equate to quieter or

51:40 are there other measures you know we've done sound walls we've done other things for mitigating noise and that is right in the middle of a neighborhood like a lot of them but just because it's not new on the list doesn't mean there's other types of mitigation that's true yeah there's other things we can do yeah thank you very much for the presentation sorry i joined a little late technical difficulties thank you to andrew for helping me get back in um i have a handful of questions here with the fema storm mitigation um i think it's a great investment wherever we can afford to do it especially if we can get

52:26 federal help i'm curious how we prioritize locations where we've moved overhead lines to underground for for when we when we apply for those fema grants we have to do a cost benefit analysis and then we have to supply data for that and we get help with that from fema so it's it's really uh determined on your benefit of such a project so it has to be a cost benefit to be able to launch and get those funds um [Music] sorry yeah i was based on past reliability in past events so we'll look at outage history both in on a normal day and also for larger storms and it has to be somewhere that's been hit multiple times and it's kind of a

53:11 trouble area so that's how that one rose to the top of the list great thank you and is it just one project that we did then we haven't done that in multiple parts of town over the last several years we have done we i think we did 16 total i think 13 of them were on this you know minor side and then we had three larger ones that were these overhead to underground okay we're still we're still doing the third one or launching the third we got approval for that late last year actually so you can see there's a lag in in the funding yeah okay great thank you uh the next question is how much uh does seismic performance drive our improvements um do we have a sense of where which

53:58 parts of our systems both electric and water are most sizable seismically vulnerable and did those parts get prioritized for replacement or replaced earlier than they would otherwise i think on the on the water side you know we're it's really our resilient spine we're focused on it's all of our you know the older systems are more um susceptible to seismic activities you know we used to not restrain our pipe the newer systems we do but um it's really the we go for the bag for the buck so we seasonably upgraded hayden bridge because it serves everybody now we're going to seismically upgrade our reservoirs and our

54:44 transmission because they they serve everybody and then you know at the same time we'll slowly focus in and we are targeting older pump stations and things like that so it's kind of scattered throughout the facilities but that's how we're handling it on the water side make sense for electric first thing we do is look at um critical loads and connections around our system and then we'll go to each one of those sites and do a gap analysis we call it where we look at okay is there what's the difference between it being seismically operated and where we're at now and then that kind of develops a scope and then what we've been doing is going through those stations that need those and putting those on the capital plan each year the ones we've been focusing on to start with typically uh

55:30 is is transformers we've been doing multiple transformer anchoring per year so that because those are that you're kind of paying for the buck is a good word your highest lead time highest cost most important piece of work once we're done with those we'll go back start doing control buildings and then there's other things you can do to protect from damage you're really just limiting the amount of work you have to do after the earthquake and so uh but it's mainly driven by criticality and then if it's seismic rate or not after we're done with all those then we'll start fanning out beyond that but we're still on the most critical loads first great thank you both that's super helpful all right and then the last question is about the 20 million set aside for liberg for mitigation and i'm trying to wrap my head around is that just a fund in case we have something come up between now

56:15 and and the time we make major investments in that facility or is that the budget that's kind of the starting place for those major investments in that facility is that question clear commissioner mccray that was just a number we stuck in last year to cover some incidental um issues that might might emerge in in just the short period of time that we were in the midst of assessing the assumptions around lieberg will change dramatically over the next month as we meet with the commissioners on the 16th and then we start to incorporate what some of those new placeholders will look like um

57:00 you know depending on the the direction that we're starting to receive it is it is uh i don't want to talk about sticker shock yet but 20 million is going to be buried in the noise yeah i know that's that's why i was asking um i was concerned if that was sorry the budget that we were setting aside for major improvements but it sounds like that's just a placeholder so that we have funds to work with um in the near term so thank you for the clarification that's all i have thank you brown thank you other questions i'm going to jump in with a few uh even so can you go back to the slide with the 14 substations please

57:45 so um are all the first five in springfield and the river uh yeah well uh not the current substation number one that we're working on here the rest are yeah eighty percent of them so yeah if uh if we had a shift from uh we said it somehow negotiated with lane electric or sub to take over that territory is that could they serve that area and offset our capital needs of having to redo all those substations no really the only one is uh and i don't think it would apply as walterville was that number four up there that's a brand new one isn't it uh it's some of some of the parts are brand new

58:31 but it would this one would be really be converted from uh when we get rid of some of that transmission line it would go into the distribution system some of the change but really it's it's hayden bridge ip and our thurston substation which are all critical loads and thurston connects to bpa in the larger system so yeah and i'm just wondering isn't for the one we just built right up by the library no no that's uh no that one's a little farther okay uh that's the screen this one is well at boulterville power plant and all of those are in lane electric or what how many of those are in subs district um well two three and five i guess would be and five are in sub and so we're putting new substations in surrounded by springfield utility board well the the intricacy i'd point out

59:17 though is the the number five three and two are not serving like you know customer class load in the thurston substation we do do a backup to the hospital uh partnered with but that's more of a transmission station one of our very few ones two is hayden bridge water plan and then three is the ip plant so all right thank you don't know like neighborhood customers and then the second one i saw one of your slides saying you're going to amend your ten-year plan from three percent annual inflation on construction cost of five did i see that correctly yeah we're going to talk about that in a minute thank you okay then because i i got a challenge with that so

1:00:03 especially the construction costs so all right well if that's it then i just need a kind of a direction from people we're scheduled to take a break at 6 55 it's 6 30. agenda item is scheduled frank said it's not going to be 30 minutes do you want to push through the next agenda item then take a break or you want to take a break now okay i'm not going to let the other john and matt vote because they get to take a break whenever we want they just click their camera and go uh what do you guys like to think break okay we're going to adjourn for 10 minutes

1:10:28 and it's not clear right [Music] thank you okay i'm going to reconvene the june 7th 2022 regular meeting the gene one electric board the next agenda item is number nine the capital investment planning and project update part two part two good evening commissioners again in virtual world uh i wanted to start this conversation with something i often tell employees and that is this is a really good time to work with uf and the reason i say that is because the investments we're making in this capital plan have huge impacts on our community

1:11:14 and future generations these are these are legacy projects you know you think about ees you think about our second source you think about carmen smith do you think about rebuilding all these substations these these are just really great opportunities for for us all to impact the future of the um community so um one of the things that i'm going to do here is is you got a lot of details from tyler and wally so i'm going to try and pull it up a little bit and do some summary kind of things to help you think about the plan a little bit what we're going to do next week one of the things a couple things frank talked about was you know we we expanded our land last year our 2022 capital plan

1:12:00 and then all the metrics and the guidelines and everything we talked about last year and i hope you picked up on the themes that tyler and molly really talked about which is the reason that the increase is really going towards those risk-based investments and so those investments are really in our resiliency project in replacing aging infrastructure and so that's what's going on with the capital plans that they're expanding i guess another thing that you may have picked up on a little bit is um molly alluded to it but we've been pretty successful at our

1:12:45 planning and budgeting and execution of our projects so i wanted to do is just take a minute and do a kind of a look back you know how have we done in the last five six years and so part of the the cip that gets presented in your tip is a five-year look at him right and so i went back to 2016 and looked at the look ahead number for the next five years and then water was about 77 million dollars and then electric it was about 206 million so the uh what we did is we totaled up the numbers and see how we did now water's an overachiever here so they spent a little bit more than they said but still we're doing pretty good

1:13:31 uh electric um 88 which is very good considering the amount of numbers and projects and the amount of money we're spending the biggest uh factor in that 88 is carmen smith and the re-licensing project and moving big rocks around employees and getting that basically getting the lines so it was more of a timing thing if you look at the type 1 in type 2 especially both in water they come in at 100 and so very very diligent and good planning and good work going on we also do every year based on the cip we do budget for next year so when we come to you in july we'll bring you next year's budget so i took a look

1:14:17 at the average every year for the past five years and again honors leading the back but but again the uh the carmen smith relies the same impacts that year to year budget so it's moving those big rocks but type 1 and type 2 again very very solid very consistent for the actual budgets probably a couple other things you picked up on was uh um some of the impacts to the capital plan so there's uh emerging risks you know when we make these projections what what are the risks what are the things that may we were just talking about inflation for one right so

1:15:02 there's a lot of inflation going on and so that reduces the buying power of this this plan these plans it could impact long term how we how much we get done if we keep our same goals that the money you have might be less to get those goals done what we're really looking at though and the plan we're going to bring you in july is we expect the impacts of the population to be around two years so what we're going to do is instead of using the normal three percent inflation rate now inflation this number contains construction labor all these kind of things buried within it and devil will probably go through that intricate detail next time but we're going to put a higher value in the

1:15:47 next two years for inflation see how that impacts the capital plans we talked about supply chains a lot i think there was a thing in the gm report that detailed out some of the things we are doing to address supply chain issues again that's expected to be an impact of two to three years um [Music] really the the impact in my mind is mostly material delays and these price spikes and so that's impacting our ability to get work done in the next couple years i think you've seen some of the material about how we're delaying some projects getting really creative about rescheduling and deciding what we're going to do a big shout out to to clinton purchasing uh their whole team for really being

1:16:33 creative working with the engineering and planning teams doing so for some interesting things and looking at products and getting products utilities so um some good things going on there to manage that i think one of the big uh concerns is uh and i think labeled as damn safety and so lieberg i think is a good example of that where you have some some pretty large assets there that that could cost a lot of money depending on how we move things around so these are long-term expenses that could be pretty large what we're doing right now though is we kind of talked about this a little bit we were

1:17:19 putting some dollar amounts in there so if we're directed to do something immediately we can do something immediately so it's in this case it's 20 million dollars for the board's going to have lots of opportunities moving ahead here to have discussions about what to do with berg and then the burke is going to have some opportunities to weigh in on that decision i'm sure as well so these are long-term impacts that we don't really understand and know yet so if you go back to our conversation last year we looked at the water department and the water budget we brought you to two valleys we brought you one with the the second source and one without the second source and so those constituted

1:18:05 without the second source we've had all the metric and rate targets if you add in the second source which is a choice and it's a big number and it'd be very similar to something that would happen here so we would have these as we learned these costs we'll bring them to you in these sort of big chunks with some of the impacts to all the other things that we're looking at so that's to come [Music] pmi we've talked a lot about i think the really kicker here with ami is not so much the cost or the impacts as much as it is to the strategic goals we have around data customer consumption impacts on our power planning and in some of these kind

1:18:51 of things products and things that we really want to do moving ahead um but we do expect uh hopefully as early as next june to get started for hybrid water soon right now but still still uh installing meters one of the things that that has happened and tyler alluded to this uh increasing compulsory work which is really just another way of saying we're dealing with failures right we've got old stuff a lot of things your 40s and 50s that stuff's getting to them alive i mean leaving the canals and some of these things right so you as those things fail they move from risk-based projects and programs they move into that compulsory just like that right so

1:19:36 you lose you lose your plan you lose your opportunity to make choices and so you have to stop and work on these things that's tyler alluded to that we've had about all uh delay in some of our risk-based work to do work on ip and some of the neurosubstances labor is also a challenge i think you heard that from both of them i would say though that you know it's probably that's a traditional thing labor and inflation is things we always sort of deal with especially in water though or excuse me electric a little bit of slow down in the next

1:20:21 couple years we're going to try and energize and beep up the fill all the technical positions we need to create standards and get plants together and that's probably more of a five-year challenge so just to again in summary you know it's uh this is an impactful time to work here with a lot of things that we're getting in on we expanded our plan last year to increase

1:21:07 resiliency in aging assets really we've done a lot of work to show that we can manage these budgets we have a lot of cooperation we do a lot of meetings we do a lot of work with finance and other departments to manage the budgets and i think that's going really well we feel like there's a lot of these issues almost every one of them investing in one way or another and then what we're going to do is work with finance to bring a plan that includes these these adjustments that i've talked about and of course

1:21:52 the board as part of our okay thank you very much sonia the first slide that you add up had the cost was kind of metric as percent of completion and so it seems like that's a little bit complicated is there any way to separate the two because you know cost and the amount spent could be a factor of inflation or not being able to control costs versus

1:22:38 what i think you're trying to measure is how much of the work did you plan to complete versus completed and i'm just curious if there's a way to separate those two out a little bit so we can really get a sense of how much we plan to complete here's how much was completed here's how much we planned to spend versus how much was actually spent i would just there's some way to couple those two that would be appreciated um and then you mentioned the inflation rate but you didn't actually say what inflation rate you were you're saying last year yeah so john's probably gonna ask this anyway so um the uh normally what we've done is used three percent as an average inflationary rates so what uh finance team is selected as five or five and a half

1:23:23 percent for the next two years you know i think if devs on she may have i'll let me weigh in a little bit okay on this on this too so um what we typically do is we talk to a number of economists around what does long-term inflation look like and that's where historically we've gotten numbers anywhere from 2.1 to 2.9 we historically used 3 as an overall number just just to account for the fact that today's dollars and dollars in the planning horizon that we're looking at will be different the value will be different and to your point that affects the scope and the rate of which you're doing projects um what we're hearing um from economists

1:24:08 now number one is it's volatile and so there's some discrepancies around how long is the inflationary pressure or the inflationary pressures going to last that's part of what we would want to get some feedback from the board on because there's a couple of ways to handle it we've made the assumption at least initially that it's something greater than three it could be five you know that in the next two or three years those are things that we're having discussions around uh to to account for the fact that there's this pressure the reason that we wouldn't take some segment and i think president brown is right if you look at certain products or certain segments you're going to see double-digit inflation in things like contracting and certain

1:24:53 components but we also have other dials that we that we work with and so when you start to apply inflationary factors that are larger do you then manage your your plan by saying well at five percent we can afford this or a ten percent we can do that and you start to actually shift and maneuver your projects around as part of your mitigation as well um if you went by an absolute gosh i could say the wrong thing um if you go and with a specific project schedule then you're going to be looking at more of a near term you know one year two year to two years at a time and it may be different than that five percent um or six percent or whatever

1:25:40 it sounds like that and the trade-off for the board is that the larger numbers you put in there potentially the larger impact you have on rates so there's a trade-off there um and we can make you know that's part of what we want to get feedback on the board from is you know is it fair for us to put a different number in the early years we've also looked at how we do our scheduling that's both the labor issue as well as a timing issue or so what you might see next month or some projects shifted around a little bit you know we thought this was in 23 maybe it's in 25 and so those are some of the pieces of feedback that we'd like to get but we we did start with a five percent

1:26:29 um i guess what what other guidance did you meet what are what other questions regarding are you looking is there something that you think we're missing in the process you know one of the things that um i i felt like last year was um the first time we'd really asked up front here's sort of the rate guidance that we would want we picked an inflationary guide post for example is there something else i mean we we do have some supply chain issues but i i will say that in over the course of a long-term plan these are things that we manage

1:27:14 these are you know labor resources always go up and down financial resources always go up and down i i feel like e-web's done a really good job of planning for the horizon and one thing raw did not mention which is an emerging thing as well is there is now different financial options the infrastructure investment and jobs act for example we we have a group that we've put together to look at different kinds of financing so not all of this has the potential to fall back directly on rates so those are the kinds of things that we're looking at but really part of the question is yeah inflation that's one question sounds like there's review that we could look at on that and another thing is are we missing

1:28:00 i anything see that we're missing anything from my perspective i do appreciate the look at the inflationary piece but balancing that with rates so we have to push projects to keep it in a reasonable that's it for me thanks the one thing i did hear commissioner carlson is that a little bit of further breakdown as to the the scope of work not just the rate of investment would be helpful and i think we can do that again the type one type two type three lin lend themselves towards different

1:28:45 types of feedback for the board um relative you know sort of mass metrics on the type one and then project specific on the type two and three we could forget yeah i'll have to check on that it was sometime in 2023 i believe thank you um so a couple of things um this all lends into going into our budget back and where we're going to go with that and and for me you know this is a 10-year

1:29:30 cip and long-term financial plan and so we're all worried right now about inflation you know a recession could come in the next two to three years that could drastically impact that so i think that the utility has positioned itself well to withstand inflation and one of the tools that i see that we have at our at our fingertips or our denver's fingertips is uh our reserve funds and our rate stabilization funds i think rate stabilization could easily offset one or two percent of uh inflation on any specific project so that's something that i see

1:30:18 last month when we were seeing those numbers being transferred and going quite high you know when you're talking 26 million dollars in in a reserve fund in electric and 10 plus million in water that always gave me pause but but using that as a hedge to take care of some of these short-term things i think it was a wise choice this next question i have is what percentage of these long-term big projects do you think will be bonded as opposed to paid upfront from rate payer or savings

1:31:03 so i think that um commissioner barofsky those are some of the questions that we will get into next month specifically when the finance team brings back the in essence the year by year cash flow for the next 10 years historically there's been more frequent borrowing on the water side than there is on the electric side and an example of that would be we would need to do some kind of financial mechanism for a secondary treatment plan as an example so that that's a detail that we'll present next month when we get into the specific next year view of the plan i will say one comment about your reserves observation

1:31:49 i do think that that's an accurate statement i would also say that most of the build up in reserves was for obligations that we have already made for example with carmen smith where this is now a re-licensing obligation to those in the in the settlement parties and part of the license obligations so um those what aren't necessarily just free funds to completely use for raid mitigation but um your observation is right when you're in a when you have financial head room and solid reserves it does give you some ability to dampen things like inflation so that that's correct

1:32:38 yeah and i was just going i mean if you think about on a small you guys are are thinking on grand scales well i i think on a small scale if i'm doing a remodel or if i'm doing something at my house i keep it you know there's a contingency amount because you when you open up wall you don't know if there's dry rot in there you have to have that contingency amount and i and i'm glad that that eweb has that and i see as a difference between a 3 rate of inflation and a 5 but hopefully that would fall into a contingency account so that's what i'm thinking and i think also one of the biggest uh noticeable changes between what you're what you actually received in last year's long-term financial plan versus

1:33:23 the one that you'll see on july 5th is that there will be a substantial financial requirement associated with the lieberg project um not something that we at a level where we would historically not just burden the ratepayers with that um it's it's going to be substantial enough that you'll learn more about that in two weeks next week sometime upcoming and so that will be a significant requirement put on the electric

1:34:08 any other questions or comments [Music] um i apologize to this question but we had um projected out what rates were going to be several years and we did that before the world kind of long all this at us right really before we knew how long the pandemic was going to last supply chain all that stuff and so um how much do you anticipate that when your doctor revives those rates based on what you've given us tonight i mean how how much are you already putting together like numbers for that or is that something that

1:34:54 yes we're putting together numbers for that that there there will be trade-offs that the board can evaluate in this process um and you know one of them one of them there will be there will be uh rate pressures that occur because of things that we have to do those are the compulsory work typically obligations like license obligations there's not as much flexibility in those there's some degree of flexibility in how you finance those or when you finance those there are there is going to be a trade-off and and those numbers will bounce around a little bit and that's what we'll be talking to the board about as those sort of shift and and move do we do we look at that over the next year or two how does that

1:35:40 impact our sort of next budget cycle versus the overall revenue requirement that you tend to see multi-year on the long-term financial plan you know i think i think the interesting thing and rod made the observation from a comparator perspective relative to leu utilities in our area and especially other utilities outside of our area we're very well positioned from a rate perspective that is much different than we were for example 10 years ago that gives us a lot of head room to maneuver even on the rate side and because of how the system involved in eugene both water and electric this board is has the opportunity i'll

1:36:25 i'll say it that way to really make some legacy type of decisions and rod used to use the term it's a really impactful time exciting time to work at eweb that's because a lot of these things are multi-generational and the board is participating that and it's a matter of how we want to deal make the trade-offs between sort of the near-term rates versus the long-term benefit and that's that's why you're here and that's sort of exciting to think about doesn't look very exciting you good mindy i have a kind of a question and a comment about it if i may to me the most important thing we had up there abroad was ami because of work all these pressures from

1:37:10 bleeberg and from wages and for everything that's going to go on and to make our owner customers able to afford this electrification ami is critical that we get it in because they can't have time to use state we can't you know to allow the give the people the tool to make the financial decisions to afford our product because i'm scared to death about what raids are going to do with all the things we have pushing on this that i mean we've got a lot of things that aren't financially feasible coming up you know leaders one we're going to spend all that money we're going to get no revenue so that's just my my perspective there as far as the three or five percent i don't think this the petroleum thing's going away in the transportation sector so i'm not an economist or anything but i i would think still think five

1:37:56 percent's light but uh we have reserves for a reason like john b two said and i think if we have to use them we have to use them so i'm okay with five percent for short term but i think we may have to make another adjustment so thank you um anything else from anybody else on this topic if not and we ended it with a couple minutes to go anything from staff do you have what you need from us you have to ask for direction and you get the direction you want good thank you very much all right the next thing agenda item board policy update gpu

1:38:47 good evening commissioners i haven't gotten anywhere i'm still sitting here the back my back's getting a little sore um appreciate the opportunity to talk to you about some policy updates here this actually if you look back to the beginning of the year went through our annual policy review there were really three policies that the board had identified that were opportunities in from your perspective for us to take a look at as well as develop a new one sd15 rolled over from last year we made an update to the climate change policy the other the other two were um sd3 which is a customer service policy that's on the agenda and then the one

1:39:32 that we were talking about tonight which was a gp7 which was some parliamentary procedures updates to take a look at and wanted to kind of walk through a few of our observations about the policy one of them is just in general this policy defines roles and responsibilities on the board it also provides guidance relative to board attendance for example and one of the questions that had come up especially over the last year was what qualifies for attendance seems like feedback just individually from the

1:40:17 board that in-person or virtual attendance especially those who are listening virtually on online right now might consider that they're in attendance tonight um virtual in-person would both qualify for attendance at regular board meetings and that would be what our our thought would be based on feedback from you some of the other questions come relative to a couple other definitions one is is a quorum for example it specifically calls out three board members in the context of the fact that this policy also talks about board replacements a quorum could consist of a majority of

1:41:02 members of the board so what that would mean in the case if you only had four board members that you would need more than two one of the things that robert's rules of order defines is that something doesn't pass or isn't affirmative at 50 it has to be more than 50 percent and so in these two items so for example a quorum uh could consist and let's let's say under a future condition that there were only three board members for some reason um if two actually got together that could be considered quorum which would be considered a quorum so um

1:41:48 the the little bit more broad language around a quorum consisting of a majority of board members seems to make some sense as well as board actions uh requiring an affirmative vote of a majority of the board so if you had four members again you would have to get three votes for a resolution or an action to pass in that case as opposed to mentioning three three commissioners specifically because we have we have five under normal conditions and then finally vacancies on the board this is something where a couple of sort of questions and feedback there is the opportunity if a board member should resign that the remaining members

1:42:34 have an opportunity and one of the questions that we had was how specific you wanted the policy to contain a process so or just basically saying that a majority of the board needed to approve the person who has been nominated who nominates i mean there's a number of questions here um the candidate um actually i'll look at dan just for a second the candidate of replacement has to come from the war which they're replacing except in the case of the at-large position and so um commissioners could nominate they could vote there's a how prescriptive do you want us to get

1:43:19 on potential revisions to that process or if you just want to say the replacements need to to be um approved by a majority of the board so that's that's kind of the question and then um within that policy were there any other comments or thoughts or questions relative to policy gp7 okay matt and then john me too thanks for bringing this back to us frank a couple of things yes i agree that uh virtual should be considered attending meetings from here on out i also um well and then to answer that or to provide my feedback on one of your other questions there

1:44:04 given the relatively short time frame to replace a commissioner if somebody leaves unexpectedly i don't think that's the time we want to also be hammering out the process for replacement so from my perspective well i don't really want to be prescriptive i'd like it to at least be for us to have some clear route for replacement that we all agree on now with perhaps some ability to amend that process if we decide to but i i just feel like it would be good for us to have a process that's clear i don't have a um i don't have a process in mind right now but i you know would welcome staff bringing back a couple proposals for what that process might look like i don't want to spend a whole bunch of time there but i do feel like we should

1:44:49 have something pretty clear in place and then in terms of the other policies that i think we should address um there is a statement in here about recordings of the meetings and i'm of the opinion that um we should from here on out provide not only audio recordings but video recordings that should be our practice and um and it seems like as long as we're doing that we ought to provide those in the archives as well not just the audio version but i would like us to state that it is our intent to do audio visual both and make those available to the public i just think it helps people understand our conversations and it allows more people to participate that's all i have thanks

1:45:38 john b thank you um my question would be um on the quorum and the board actions is that board members present at a meeting or is that board members so when we say a quorum be defined as a majority of the entirety board and then on board actions if there's only three people in a meeting get two people i mean there would be a quorum there would be a quorum but a majority would be two and with that i guess that's the question is it at the meeting or of the commissioners

1:46:25 the way that it was stated here commissioner borofsky was of the commissioners so in the case if you had four commissioners and you had three of them meet and only two voted affirmatively for a measure or an action that would not pass in the sense that it would not be a majority of the board passing that does that help yeah so if we had a if we had a board meeting and only three only three commissioners could make it they could still pass a resolution but it would have to be a unanimous vote of those three that's correct thank you

1:47:12 other questions or comments mindy um a question about the vacancy on the board and the process to use um i know the 4j school district has done this multiple times and it's still doing it and i'm just wondering if we can find out maybe with their that's a good one but otherwise i absolutely agree that we should be able to participate virtually and um i like the other language that you've suggested thank you we can reach out to 4j and see what their process is like i don't know if it's a good one or not um i've been involved in any of those they have a lot of practice

1:48:04 yeah on the nominations piece i would like it to not be the board members specifically self-nominating um i think that there's more of an application process you know with various questions information people apply and maybe we you know board members and others help and encourage people to apply but it's not necessarily a nomination and then we as a board vet those applications and choose from that maybe with some kind of interview process that would be my suggestion and maybe that's similar to what um the school board has done something like that but i i think if we are each tied to our own person then it's really hard for us to support maybe the best candidate that

1:48:50 that seems tricky to me the i do support the virtual attendance counting and then on the majority of the board vote i think it would be even if we had a down a member such i think it would still move us to be able to do business however you know we need to have a majority of the community supported so i like the language that you proposed i think that it still covers that because we would still need three people to be able to get it that would be a majority of the representation of the community

1:49:40 thanks thank you for the idea on the sort of application process and i think that's actually probably what i've heard 4d does they anybody interested in this filming this role over this process so i'm i'll chime in a little bit i like everything i like about the the boating and the attendance virtually and things such as that about appointing people i don't know if 90 days is going to be enough if you're going to seek applicants and and you're going to have an open period of 30 or 45 days and you're going to have a screening period and this board that's going to make that decision only meets once a month and i'm just taking the logistics that you may want to think that through but more importantly i really like what sonya said about having an application process because

1:50:25 right now if let's just say i quit and each one of you want to avoid somebody it's going to be somebody that you know or you know something and they're going to maybe like mine a debut and we're supposed to represent geographic areas and if you've lived here long enough you'll know that we have different political we have you know the values and the beliefs and everything else the different geographic portions of this community are diverse and to get that diversity to say words four and five are totally different than one and eight i mean totally different and who would represent that you were the one that was stepping out yeah that's right but yeah i think i think to be fair to the process and be fair the people that you're replacing would be would be allowed to at least allow the people to make the application from that

1:51:10 geographic area and then you vet them to see who one do you think that represents the the particular people because it's you're the voter per se because the voters don't get to say anymore and so you have to take that position and you have to be you know i think clear about the process so i really like yours how you do it commissioner brown i will say the 90-day requirement is a city charter it is a city charter requirement unless you're going to have to you're going to really move because think about that people are going to have to make a decision and then they're going to have to make the application you're going to review them and make sure and then the board's going to have to meet and if unless they have these special meetings it's going to be that quick i think that supports

1:51:55 commissioner mccray's thoughts that it'd be good to have a process to find given the clock is taking that 90 days is taking so i think what we'll do is we'll try to regroup and present something back to the board that provides some efficiency in that process but also demonstrate the the community push of that applicant as opposed to the commissioner okay i've got john b two and then matt you um you know reference was made to the city charter i think that that's where we could go and look you know when when a city councilor is

1:52:40 has this process they've got it written into the city code and i think that since we're chartered by the city of eugene following their template would be probably one of the best ways to go yeah and i was just gonna add that um i don't know how hard it is to change the city charter but uh if we did some if we did some sort of process that we thought was going to take longer than 90 days perhaps we asked for that to be 120 days for an e-web replacement maybe that's too much of a battle and not something we want to wade into but you know it's a lot like anything else

1:53:25 then it can be changed um sonia has a comment i was just going to note that i think 4j had like 20 plus applicants and they had to do it pretty quick turnaround i think the appeal of not having to run a full campaign is actually pretty high if people want to get into it because then once you're into it you're an incumbent so it's a lot easier once you have that foot in the door so i don't know that there's as big of a challenge there to recruit there is but if you're not running a full campaign it seems like you get a lot more people interested man i think in response to changing the city charter if i think i'm sorry i kind of snickered a little bit but uh i'd do that to change the silt thing in a heartbeat but i think it takes a both of the general people to change it and i think that's a

1:54:11 pretty expensive and time-consuming process people tried to do it before other questions or comments just hopefully it's hypothetical and you don't have to actually do this anytime soon okay well if we pass this and get it going then nobody will resign and we'll have that this will be this will all be a move point but if we don't i guarantee is whoever wins is going to just leave you with a mess so good are you saying we better get to it well yeah time kill deals you know you've heard that before i've heard that somewhere okay well thank you very much the next agenda item board policy up excuse me correspondents frank stay up there i have my correspondence over here

1:55:08 thank you president brown there were four items of correspondence this month's packet bernelson property update which was referenced earlier in the capital discussion um a comment on e-web education grants and private schools and what that what that didn't have in it was the potential idea of since we're the ones who are granting funds to 4j and springfield and others is to and you heard the comments to to tana shepard potentially require as part of that contract that they make certain content available to other school districts or homeschooling people and that's something that we'll have to evaluate i don't i don't know

1:55:53 what um other consequences that would have but that's that's an option here to look at expanding the reach of of the grants that we already provide and then there was the the update on the the collective bargaining agreement background information and the some proposed changes to el4 policy eo4 related to really bringing that standard on compensation benefits up to present practice related to compensation policies so those were the four items of correspondence and i think we probably have people that can answer questions about them if commissioners need any follow-up

1:56:42 two i'll jump a little jump the queue if i may um i thought bertelson if we're gonna put all that much money and then design into it i thought fertilizing was gonna also be used for the hydrogen facility it is it is that's correct is that coming is that on the south side or the north side or it will be on the north east corner on the corner of bertelson and roosevelt but that's incorporated into cost with all this engineering and design that we're doing now it's in the planning and the permitting process and then if there's actual construction costs that would be okay and then my second question is on the schools i mean we're doing the dei thing and at the equity thing if we've got 16 schools and all those schools are they're all rate payers and to me

1:57:27 everybody that is in retail school should be entitled to benefit from this multi-million dollar educational grants we give i don't personally i don't think it should be just limited to public schools but that's my own personal thing i think to make sure that everybody gets a shot at it i appreciate asking donna about that today but i'd just like to get my feedback on that i think there's some people in the community that are being a little shortchanged by not getting the benefit of that educational thing we're going to educate just the kids in 4j and bethel and springfield about environment and all these other things why not the others and so i mean it's if you think of why we're doing it because they're paying into the system and so that's just my comment so others have questions or comments

1:58:19 yeah i have a quick question about the bertelson property um it looks like we're planning a handful of buildings there mostly storage um and i'm just curious what the seismic standard is for those buildings if that's life safety or if they're built to a higher standard than that to that point of design yeah did you hear that commissioner mcrae we aren't really at that level of detail i i would suspect most of those buildings um they i don't know that they would even be within the standard since they're not housing people um but we would definitely want of course if we have material you know essential materials that we're storing we would want to make

1:59:05 sure that those are going to survive the particular conditions that we might be threatened by so that's kind of a non-answer because it hasn't been designed yet but i think we get your point that we need to make sure that those are constructed uh according to proper standards yeah and i guess i would just put forward again i know i brought this up in the past but i feel like um we should plan to build everything to be surviving a seismic event unless there's a reason not to i feel like our default should be that buildings are functional like they don't have to have power and water and everything but they have to be standing and usable after an earthquake not just that you can survive them and that would apply to any storage

1:59:51 that we're building as well even if these things aren't currently storing essential items you know 10 years down the road they might be or we might really need that storage because it's the only covered storage that we have after a seismic event i just encourage us to lean in and make the default um a high seismic standard and if the other commissioners are open i'd be interested in making a motion at a future meeting on that along those lines that's all i have thanks thanks i can't see is lina still in the room or has she gone home for the evening i'm here so

2:00:36 my question was pretty much answered and that this goes to the uh compensation and benefits and the fact that if you give compensation to one person everybody in the organization has to be compensated unless there's merit maintenance thanks um so what i'm hoping is one if the sunset on the exemption for that is in september so if we're trying to use uh incentivize bonuses to bring in people let's try and do that as much as we can before september and then the second thing is i hope that our adjacent in our in our government relations

2:01:25 advocacy is advocating to extend that i know that other industry groups have to give incentive bonuses that would go against the equal pay for the past free pandemic and i'm just wondering if there's any uh accident on our end to to try and get that extended i am not prepared to answer that this evening i'd have to check in to see if there's any um buzz about it at the legislature i can check in with jason and respond back

2:02:11 commissioner i know there was there was a pretty extensive response to some of your questions earlier about el4 in the q a correspondence i don't know if you had a chance to look at that as well yeah i did and [Music] you know you do most of the things to be able to to compensate people differently but there are there are going to be limitations to that as far as signing bonuses and retention type bonuses that may have an effect on the organization with this new law and so i just want to make sure that we are keeping tabs on it and also trying to influence the legislature to allow us to use bonuses and incentives to get the

2:02:57 employees that we need without having to raise the pay of every employee in the organization that's what i'm hoping for any other questions or comments regarding correspondence if not then i'm going to move the board wrap up and uh go ahead so on upcoming agendas we do have a meeting on the 16th relative to wildfire leeberg updates um but also we will be i will be working with president brown and vice president carlson on an added topic to the july agenda which

2:03:44 will be to review our responses to the city of eugene relative to questions they have sent us on electrification so i thought i would make specific note of that july will probably be a pretty healthy robust agenda we will not be doing board wrap up at 7 35 likely on july 5th so just a heads up on that and then a number of other activities planned throughout the summer so thank you president brown okay now i'll go to board and wrap up uh anything for the good of the order tell you [Music]

2:04:29 i've got two things um i know that we're going to go public on the emergency water system in mats region shortly i'm concerned about nobody knowing about it other than a few people i what public outreach have we done i mean no ads in the weekly or public notices or anything else because it's great to build these facilities but if people don't know they exist to know where they are and how they work i build them and so i'm hoping that we have a robust very good outreach to the public to say this is it if we're going to have an emergency stop by saturday you know tend to see how it works see where it is and everything else and i don't know if we're doing that but if we're not i would hope that we could do it and if we're doing it um

2:05:15 maybe it's just the the outreach is directed to that particular geographic area but i haven't heard anything about it other than what you've told us i'll check on a couple things the specific outreach for this event i'll find out about but i know on a regular basis whether it be through our some of our resiliency work and communications or publications associated with bill inserts and other stuff we have we're constantly publishing the maps of those emergency sites as well since there are multiple of those and so we'll we'll do a follow-up point yeah i just i can't to me i can't stress that too much to say that let's make sure that everybody has the opportunity to at least know about it because this thing

2:06:00 hits tomorrow um in 24 hours people say where's my water and just i'd rather be too much than not enough on that particular topic the other thing i have is is for the board it's halfway through my tenure here and i always the only way i think people in this position can get better is to get feedback and so i'm soliciting feedback not now because i'm embarrassed but uh seriously uh sometime if you guys want to shoot me an email and say i don't like your antics i don't like the way you run a meeting or you can do it better tell me how we can do this better if you think we can do it better because i'm not gonna i'm gonna be here five more times and i'm done and uh but just want to say that whoever takes this position indeed

2:06:50 with feedback and positive or negative that's okay i don't care but i just wanted to offer that to others so we can do that because if you want more dialogue in amongst us if you want a different format if you want better food just say it and we'll see what we can do all right is there anything else the other thing is the board does have a board retreat dinner coming up this summer so they could give you their feedback directly yeah but if i ask for it it's not as bad if they just concentrate things fair enough okay anything else for the good of the earth or john b or matt you guys good all right john b2 get better get weller all right we'll see with that i will adjourn the meeting