Lane Electric - A Touchstone Energy Cooperative

03-17-14

Minutes of the Board of Directors’ Meeting
Lane Electric Cooperative, Inc.
March 17, 2014

The regular monthly meeting of the Board of Directors of Lane Electric Cooperative Inc. was called to order by President Christopher B. Seubert at 11:00 AM on Monday, March 17, 2014, at the Cooperative’s office at 787 Bailey Hill Rd, Eugene, Oregon. Directors present were Jeri Nelson, Vice-President; Charles E. Bangle, Secretary; Patricia C. Dymock, Treasurer; and directors, Charles J. Leighter, Susan Knudsen Obermeyer and Jack Billings. Also present were Charles N. Fadeley, Cooperative’s attorney; Rick Crinklaw, General Manager; Dave D’Avanzo, Manager of Member Services; Debi Wilson, Manager of Office & Staff Services; Tony Toncray, Manager of Construction & Maintenance; Doug Stockdale, Manager of Engineering Services; and Brenda Everts, Executive Secretary, who acted as recording secretary.

Member Input
No members were present to observe the meeting.

Approval of the Agenda
President Seubert asked if there were additions or amendments to the agenda. Mr. Crinklaw asked to add selecting a voting delegate and alternate for the Ruralite Annual Meeting to the agenda. Hearing no objections, President Seubert declared the agenda approved as amended.

Approval of Minutes
President Seubert asked if there were any additions or corrections to the minutes for the February 24 regular board meeting. Hearing none, President Seubert then declared the minutes approved as presented.

Principle of Substation Grounding and Design

Mike Beanland, Triaxis Engineering gave a presentation of the principles of substation grounding and design explaining how a properly designed substation must comply with National Electric Safety Code requirements, utility construction standards, and incorporate elements that support safe work practices in order to keep the facility safe for employees and members of the public.
The presentation also demonstrated the need for replacing the gravel and repairing the ground network in the Fox Hollow Substation.

Reports – Director & Committee

• Committee:

General Manager Search & Selection Committee (GMSSC): Director Nelson

• Director:

Director Report –Director’s Seubert, Billings, Bangle, Knudsen-Obermeyer all discussed the NRECA Annual Meeting that was held in Nashville in March.

• ORECA Director:

President Seubert, ORECA director, reported on the opportunity to attend and be on a panel named “Making New Directors Effective Directors Fast”, Monday March 3 in Nashville at the NRECA Annual Meeting. He also reported on the upcoming CFC financial workshop to be held at the Doubletree in Portland on May 3 & 4.

• ORECA Government Affairs Committee (GAC):

Mr. Crinklaw reported on the Governor’s Renewable Portfolio Standard (RPS) Task Force that was created with the purpose of considering revisions in Oregon RPS. He reported that House Bill 4126 was approved by the House with a 60-0 vote and the Senate with a 29-0 vote. He also reported the impacts of BLM’s draft Risk Management Plan to Harney Electric Coop and Midstate Electric Co-op to protect the Sage Grouse.

Report – Manager’s

• Thank You Cards:

Cards and thank you letters were shared with the board.

• Veterans’ Work Experience Program

Mr. Crinklaw explained that U.S. Army veteran Ryan Doak’s tour ended with Lane Electric on February 28. He was immediately hired by Reynolds Electric as their first warehousemen due to the skills he acquired while helping in the Co-op’s warehouse while Randy Boyd healed from surgery. He extended Ryan’s thanks and appreciation for thanks to the board for the opportunity provided by the Co-op.

• NRECA Annual Meeting

Mr. Crinklaw mentioned the NRECA Annual Meeting was a good meeting overall and gave a brief report on the different perspective of the speakers.

• Biological Opinion (BiOp)/ Fish & Wildlife Status:

Mr. Crinklaw gave an update on the following items:

• The final revised Bi-Op
• Hydro Forecast
• Spill Experiment proposed to the Regional Council by the State of Oregon and Nez Pierce Indian Tribe
• CleanHydro Campaign

• Regional/Federal Power Issues:

Mr. Crinklaw reported on the following issues:

• The Columbia River Treaty
• BPA Management issues
• BPA Capital Investment Review
• BPA Rate Case
• BPA Cost Recovery Adjustment Charge (CRAC)

Attorney Chuck Fadeley arrived for the meeting at 12:00 p.m.

• PNGC Financial report:

Mr. Crinklaw reported on the current monthly and year-to-date financials for PNGC through January.

• PNGC Activities:

Mr. Crinklaw reported on the following issues:

• FERC Deregistration
• Zabyn Towners Resignation

• FEMA Assistance

Mr. Crinklaw reported that local utilities are seeking assistance for costs associated with the recent ice storm. Some utilities managers’ have expressed concern the costs could result in a rate increase for their customers. FEMA representatives met with all entities March 11to document the damages and costs. Part of the process requires Oregon’s governor to declare a state of emergency. Ted Case, ORECA Executive director, is requesting help with Governor Kitzhaber’s office trying to get help for Lane County residents.

• Net-Metering Installation:

Mr. Crinklaw reported there was two new net-metering installations, bringing the total net-metering participants to 56 residential and three commercial systems producing 233,000 kWh per year.

• Pre-Pay Program Update:

• Participants = 771
• Current Percentage = 6.4%
• Goal Percentage by Dec. 31, 2014 = 15%

• CoBank Refund

Mr. Crinklaw reported Lane Electric’s total patronage capital allocation from CoBank for the year 2013 was $11,204. The refund received was 75 percent of that total, or $8,403.

• Unit A Wage Increase

Mr. Crinklaw reported per the union contract, applicable to Unit A employees, wages will increase 1.5% effective April 1. The CPIW for the year 2013 was 1.44%, the contractual minimum is 1.5%.
He also reported this is the final year of that contract.

• Conferences & Meetings:

• The Creswell. Chamber of Commerce – Community Awards Banquet was held March 7 at the Emerald Valley Golf & Resort.

• The NRECA Directors’ Conference is scheduled to be held March 22-25 in St. Louis MO. Directors Nelson and Dymock are scheduled to attend.

• NRECA Legislative Mission will be held May 18-22 in Washington D.C. Mr. Crinklaw and President Seubert are scheduled to attend.

• NWPPA Annual Meeting will be held May 18- 22 in Billings Montana. Directors Billings and Dymock are scheduled to attend.

• PPC/NWPPA Reception:

Mr. Crinklaw reported the he will be the recipient of the “Alan Jones Award” and will be recognized at a reception hosted by PPC/NWPPAA on April 2 at the Sheraton Hotel/PDX.

• Travel & Meetings Itinerary:

Each director received a copy of Mr. Crinklaw’s travel and meeting itinerary for February and March.

Policy Review

Mr. D’Avanzo, Manager of Member Service reported on the policy subject to review, Policy 109 (Indemnification of Directors, Officers & Employees) and Policy301 (Service Policy). There were no suggested changes in Policy 109 and several proposed changes in Policy 301. Upon motion made and properly seconded it was approved to renew as presented Policy 109 (Indemnification of Directors, Officers & Employees) and renew as amended and presented Policy 301 (Service Policy). The motion was approved by unanimous vote.

Approve E-Series Rate Schedules

Upon motion made and properly seconded it was approved as presented, effective with bills rendered on and after May 1, 2014, the following rate schedules applicable to Lane Electric Cooperative/Emerald People’s Utility District customer transfers.

• Schedule GS-1E General Service Single-Phase
• Schedule GS-3E-1 General Service Three-Phase (<50 KW)
• Schedule L-AE Security Lights
• Schedule Sl-3E Street Lighting Service

Select Date for 2014 Annual Meeting

Mr. D’Avanzo reported on three possible dates for the 2014 Annual Meeting: August 25, September 22, and October 27. Upon Motion made and properly seconded it was approved to select Monday October 27 as the date for Lane Electric Cooperative’s Annual Meeting. The motion was approved by unanimous vote.

75th Anniversary Recognition Plan

Mr. D’Avanzo explained the preparations being made to celebrate and recognize Lane Electric’s 75th Anniversary on Saturday May 17 as well as the plan for the year following.

Cyber-Risk Insurance Renewal

Debi Wilson reported the current coverage with Hurtado & Associates will expire March 31. The available coverage and renewal rates were discussed. Upon motion made and properly seconded it was approved to renew the Cooperative’s cyber-risk insurance coverage with Hurtado & Associates for coverage through March 31, 2014. The motion was approved by unanimous vote.

Presentation & Acceptance of 2013 Audit Report

The Lane Electric Cooperative Audit Committee came to order at 2:15 p.m. on March 17, 2014 at the Cooperative’s headquarters. The Committee members, being all the directors of Lane Electric Cooperative, were present. Also present was Kenneth Kuhns of Kenneth Kuhns & Co., the Cooperative’s engaged auditor.

Mr. Kuhns said the audit went very well and resulted in a clean, unmodified opinion on the financial statements.

Mr. Kuhns went over significant highlights in the 2013 audit report, including:

• Margin totals.
• Ratio of equity to total assets was good.
• Capital credit retirements.
• Working capital position good.
• Long-term and short-term borrowing and debt.
• Investments.
• Deferred credits and debits.
• PNGC credit facility guarantee.
The Committee then went into executive session with the auditor. The Board then reconvened into regular session. Upon motion made and properly seconded it was moved to accept the 2013 audit report as prepared and presented by Kenneth Kuhns & Co. The motion was approved by unanimous vote.

Resolution 2-14 – Capital Credit Retirement Authorization

Debi Wilson reported per Policy 602 (Capital Credit Retirements) the board would need to consider retirement of the 2013 operating margins. If the retirement is authorized, the funds should be refunded to the members by April, 2014. Upon motion made and properly seconded it was moved to approve Resolution 2-14, a resolution authorizing the retirement of outstanding capital credits for calendar-year 2013. The motion was approved by unanimous vote.

Financial Report

Ms. Scoble, Controller, along with Debi Wilson reported on the financial condition of the Cooperative for the period ending February 2014.

Safety Program Report

Tony Toncray, Manager of Construction & Maintenance, reported the Office safety meeting was held February 20, and the topic was “Blood Borne Pathogens”. The Construction and Maintenance safety meeting was held February 27. The topic was “Hearing Safety”. He also reported on the status of the Employee Safety Program through the end of February and reported there have been 537 days without a time loss injury.

Directors Billings and Bangle also reported on the safety meetings.

Agenda Items for April 28

• Donations
• Appoint CRC Voting Delegate
• Review 2013 Tax Return (Form 990)
• Construction work plan activities report
• Smart Hub Presentation
• Accounting of Renewable Energy Credits
• Board Transition

Legal report and Executive Session

There being no further business to come before the board in open session, the directors along with Mr. Crinklaw and Mr. Fadeley, entered into executive session.

Adjournment

Meeting adjourned at approximately 4:15 p.m.