Meeting of Commissioners of
Public Utility District No. 1 of Clark County, Washington
May 15, 2018

A meeting of Commissioners of Public Utility District No. 1 of Clark County was held at the Electric Center, 1200 Fort Vancouver Way, Vancouver, Washington, on Tuesday, May 15 at the hour of 9:00 a.m.

Present: President Jim Malinowski, Vice President Nancy Barnes, Secretary Jane Van Dyke Commissioners, CEO/General Manager Wayne Nelson, Director of Operations Dan Krebs, Director of Finance Rick Dyer, Director of Energy Resources Dan Bedbury, Director of Communications Lena Wittler, Director of Engineering Cal Morris, Director of Water Doug Quinn, Director of Customer Service Lisa Fix, Manager of Energy Planning and Operations Tom Haymaker, Energy Resource Manager Terry Toland, Accounting Manager Melissa Ankeny, Environmental Resources Manager Jeff Wittler, Construction Services Manager Dana Allen, Transmission and Distribution Manager Ben Feliz, Water Operations Manager Oscar Maciel, Water Quality Manager Dan Charlson, Water Quality Specialist John Roth, Energy Services Project Manager Matt Babbitts, Heavy Equipment Operator Eric Fjeldos, Office Manager – Water Sarah Robinson, and Assistant to CEO/General Manager Margaret Anderson.

Press Representatives: None

Others Present: Judy Chipman, Don Steinke, Terry Oliver and Rick Syring, Gael Kantz-Department of Health, Elizabeth Hyde-Department of Health, Mike Means-Department of Health, Andy Anderson-Department of Health, Steve Andersen-EES, Todd Gatewood-GE Plant Manager, Ken Roach-GE Maintenance Manager, Steve Ellsworth-GE Shift Supervisor (Materials A)

At 9:00 a.m., President Malinowski called the meeting to order for the transaction of formal business noting a quorum was present and the agenda (Materials B) was approved as submitted.
Member of the public Don Steinke provided comment on Clark Public Utilities spending its surplus on more conservation (Materials C).

Consideration of the Minutes of May 1, 2018
There were no changes or corrections.

Consideration of Accounts Payable
The board, by a unanimous vote, approved the following payment amounts as listed on the Letter of Transmittal dated May 15, 2018, from the District Auditor:

Electric Revenue Fund – $4,954,299.87
Water Revenue Fund – $158,621.00
Generating System Fund – $610,560.95

For a total of $5,723,481.82

Presentation of Commitment to Excellence Award from Department of Health
Mike Means and Andy Anderson with the Department of Health presented Director of Water Doug Quinn with their Commitment to Excellence Award.

River Road Generating Plant Award
Energy Resource Manager Terry Toland presented General Electric staff with the Best of the Best Award that he received on their behalf at a conference earlier this month.

April and May Service Award Presentation
Director of Engineering Cal Morris introduced Dana Allen, Construction Services Manager. Dana was recognized for 25 years of service.

Director of Operations Dan Krebs introduced Eric Fjeldos, Heavy Equipment Operator. Eric was recognized for 20 years of service.

Director of Water Doug Quinn introduced Jeff Wittler, Environmental Resources Manager. Jeff was recognized for 20 years of service (Materials D).

Consideration of Resolutions of Intent to Establish LUD Nos. 1311, 1335, 1336, and 1337
Director of Engineering Cal Morris addressed the board regarding the Intent to Establish Local Utility District Nos. 1311, 1335, 1336, and 1337.

Resolution No. 7450 – LUD No. 1311 – Urban Point Subdivision
Resolution No. 7451 – LUD No. 1335 – Peacock Manor
Resolution No. 7452 – LUD No. 1336 – Velvet Acres PH 2
Resolution No. 7453 – LUD No. 1337 – Kelly Square Townhomes

After the presentation by Mr. Morris, Commissioner Malinowski opened for public comment. There being no comment, a motion was made by Commissioner Van Dyke, seconded by Commissioner Barnes, and unanimously carried that Resolution Nos. 7450 – 7453 be adopted and a public hearing was set for June 5, 2018 (Materials E).

Consideration of 2016 Final Renewable Target and 2018 Established Target
Steve Andersen with EES Consulting reviewed the memo dated May 10, 2018, outlining Clark Public Utilities’ 2018 annual reporting under Renewable Energy Target requirements of the Washington State Energy Independence Act (Materials F). Mr. Andersen reviewed the three compliance options; Clark Public Utilities will use the no load growth option for 2018.

Commissioner Barnes moved to approve the policies, data and methodology for Clark Public Utilities’ reporting compliance for 2018 under Renewable Energy Target requirements of the Washington State Energy Independence Act, RCW 19.285. Commissioner Van Dyke seconded the motion and it passed unanimously.

Mr. Andersen also reviewed the final compliance year 2016 renewable targets which is due to the Department of Commerce by June 1, 2018.

Consideration of Bonneville Power Administration and Bonneville Environmental Foundation Contract Extension
Energy Services Project Manager Matt Babbitts provided the board with a review of the Bonneville Power Administration (BPA) and Bonneville Environmental Foundation (BEF) contract history (Materials G). BPA is accepting public comments regarding the extension of the contract with BEF. Mr. Babbitts read the comments suggested by staff and requested the board’s approval. Commissioner Van Dyke moved to submit the comments as presented by staff to BPA. Commissioner Barnes seconded the motion and it passed unanimously.

March Financials
Director of Finance Rick Dyer addressed the board (Materials H). March had cooler and drier weather resulting in electric revenue above forecast. Mr. Dyer reported that both system sales and off system sales were above budget for the month. March residential sales were 105.1% of budget, commercial sales were 100.9% and industrial sales were 101.2% of budget. March ended with a net income of $4.7 million compared to a budgeted net income of $965,000. Year-to-date net income is $7.1 million ahead of budget.

Mr. Dyer provided an update on conservation spending. In 2017 spending was 87% of budget; however, energy savings was greater than projected. Several projects that were budgeted in 2017 will be completed in 2018. Electric System capital spending ended the year $827,000 below budget and the Generating System capital spending was $763,000 below budget. These unused budgeted dollars will be carried into 2018. Mr. Dyer also provided an update on conservation and capital spending year to date.

The Water System ended March with 217 new customers resulting in a growth rate of 2.48%. The net income for March was a loss of $43,000 compared to a budgeted net income loss of $303,000. Year to date, the Water System is showing an annual net income of $299,000 compared to a budgeted net income loss of $464,000.

March Wholesale Operations Report
Manager of Energy Planning and Operations Tom Haymaker addressed the board (Materials I). Mr. Haymaker updated the board on power supply, noting that Slice performed 7 aMW above prompt month and 56 aMW above budget forecasts. Temperatures cooler than normal contributed to load growth. Mr. Haymaker also provided a summary of the annual runoff forecast, the effect so far of the spill program that began in April and the Slice true up forecast.

Consideration of Use of 2017 Surplus
CEO/General Manager Wayne Nelson reviewed with the board the potential uses for the 2017 surplus (Materials J). Mr. Nelson provided details for surplus use for a customer refund, a rate reduction, an addition to the rate stabilization fund, debt reduction/restructure and low-income assistance. Following a thorough review, staff discussion and public comment, the following action was taken regarding the Electric System and the Water System 2017 surplus.

Commissioner Van Dyke moved that $3.5 million of the 2017 Water System surplus be used as follows. $1.5 million be used for continuation of the AMR Water Meter replacement program, $2 million be used to establish a Rate Stabilization Fund for the Water System and future Water System capital funding move to 20% rate funded and 80% debt funded. All interest earned in the Rate Stabilization Fund will remain in the fund. Commissioner Barnes seconded the motion and it passed unanimously.

Commissioner Van Dyke moved that $2 million of the 2017 Electric System Surplus be used for a low-income assistance program to be defined at a later date and to be administered by Clark Public Utilities. Commissioner Barnes seconded the motion and it passed unanimously.

Commissioner Barnes moved that future interest earned on the money in the rate stabilization fund remain in the fund. Commissioner Van Dyke seconded the motion and it passed unanimously.

Commissioner Barnes moved that $10 million of the 2017 Electric System Surplus be returned to the customers of Clark Public Utilities. Commissioner Van Dyke seconded the motion and it passed unanimously.

Commissioner Van Dyke moved that $10 million of the 2017 Electric System Surplus be deferred to 2019 capital spending allowing the utility to borrow less in the Fourth Quarter of 2018. Commissioner Barnes seconded the motion is passed unanimously.

Commissioner Van Dyke moved that $1 million of the 2017 Electric System Surplus be moved to the Rate Stabilization Fund in recognition of the interest earned previously that had not been placed in the Rate Stabilization Fund. Commissioner Barnes seconded the motion and it passed unanimously.

During the discussion, the board acknowledged the funds set aside for the Rate Stabilization Fund and to refund customers were to be used in future rate periods and would be recognized as regulatory revenue of the Electric and Water Systems. Further, the board amended the 2018 budget to increase rate funded capital by $5 million.

Commissioner Reports and Comments
There were no reports or comments

Staff Reports
There were no reports or comments

Other Business before the Board
There being no further business to come before the Board the was meeting adjourned at 12:30 p.m.