Lane Electric - A Touchstone Energy Cooperative

08-25-14

Minutes of the Board of Directors’ Meeting
Lane Electric Cooperative, Inc.
August 25, 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, August 25, 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
There were five members present to observe the meeting, J. Ingrid Kessler, Kathy Keable, Gary Jensen, Nathan Philips and Lynn Bowers.

Approval of the Agenda
President Seubert asked if there were additions or amendments to the agenda. Hearing none, President Seubert declared the agenda approved as presented.

Approval of Minutes
President Seubert asked if there were any additions or corrections to the minutes for the July 21 regular board meeting, or the special board minutes for July 30, 31 and August 8. Lynn Bowers asked for a correction in the July 21 board meeting minutes. Hearing no other corrections or comments, President Seubert then declared the minutes approved as amended.

Reports – Director & Committee

• Committee: General Manager Search Committee has selected Mr. Matt Michel to the General Manager Position and he will report to work October 1st.

• Director: None

• ORECA Director:

President Seubert reported that Jack Billings has submitted his application to run for a seat on the NISC Board.

• ORECA Government Affairs Committee (GAC):

Mr. Crinklaw reported on a scheduled meeting with Congressman DeFazio on August 27.
Those scheduled to attend the meeting are; ORECA’s Executive Director, Ted Case, Board President, Chris Seubert along with General Manager, Rick Crinklaw.

Report – Manager’s

• Thank You Cards:

Cards and thank you letters were shared with the board.

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

Mr. Crinklaw gave an update on the following items:

o Hydro Forecast
o Fish Populations
o Cormorant Predation
o 2015 Clean Hydro Campaign

• Regional/Federal Power Issues:

Mr. Crinklaw reported on the following issues:

o BPA Management
o The Columbia River Treaty
o BPA Rate Case
o Energy Northwest Bond Refinancing
o FCRPS Hydro Power Program

• PNGC Financial Management:

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

• PNGC Activities:

Mr. Crinklaw reported on the following issues:

o FERC Deregistration
o Coffin Butte Generation Project purchase
o End Use Survey
o NLSL Purchases

• FERC Security Standards

Mr. Crinklaw reported FERC has issued proposed physical security standards. September 8 is the deadline for comments.

• King Estate Solar Project – Update

Mr. Crinklaw gave an update on the solar generation at the King Estate Solar project.

• Net Metering Installation

o West 1st Street, Oakridge
• 3.5 kW PV System
• 12% capacity factor
• 3,675 kWh/yr

o Ridgetop Rd, Eugene
• 4.4 kW PV System
• 12% capacity factor
• 4,688 kWh/yr

o Program Participation
• 57 Residential
• 3 Commercial
• Total installed generation: 238 kW
• Total estimated generation: 254,790 kWh/yr

• Renewable Energy Credit Purchase

Following the board approval, PNGC purchased 25,000 Renewable Energy Credits (REC’s) at 75 cents per credit for the total purchase price of $18,750. With the purchase of the REC’s along with King Estate Solar project REC’s and the Wind Energy and Hydro REC’s purchased through Bonneville, Lane Electric is projected to satisfy Oregon Renewable Portfolio Standards through the year 2035.

• IRS Ruling – Retirement of Capital Credits

Mr. Crinklaw reported in March the IRS made a favorable ruling in regards to discounting Capital Credits. The content of the ruling:

o Authority is consistent with the Board of Director’s fiduciary duties.
o Discount rate is accordance with prevailing market rates.
o Discounting treats former and current members fairly.
o Does not adversely affect a Cooperative’s tax-exempt status.
o Does not adversely affect 85/15 test.

• NRECA Review of RS Plan

At the ORECA Mid-Year meeting, it was reported that all participants in the NRECA RS Plan would need to get a review/audit to be in compliance. Mr. Crinklaw reported that Kenneth Kuhns & Co. conducted the review. The Cooperative is in compliance and no further attention is necessary.

• Employee Demographics

Mr. Crinklaw compared the projected year 2015 employee demographics with the year 2004 and reported on the projected wave of retirements due in staff along with Unit B and the effect of the past successful succession planning in Unit A.

• CFC Financing

Mr. Crinklaw reported that Debi Wilson is working with CFC to review and discuss the Cooperatives’ debt portfolio with the hopes fixing interest rates on debt scheduled to be re-priced in the near future.

• CoBank Representative

Mr. Crinklaw reported that Leigh Taylor, Northwest Customer Representative, has left CoBank. She has accepted a position with FCC Services. Her new title is Director of Talent Assessment.

• Payment Type Statistics

o Pre-Pay Participants: 843
o Electronic Payments: 7,366
o MAP and Round-up: 48

• Conferences & Meetings:

o Robert’s Rules of Order – Lane Electric is scheduled to host the NWPPA class on August 26. Debi Wilson and Tony Toncray are scheduled to attend.
o PNGC Annual Meeting will be held in Portland on October 6-7.
o NRECA Region IX will be held in Omaha NE October 15-17

• Summer Social:

Mr. Crinklaw reminded everyone of the Summer Social hosted by the Crinklaw’s at their house following the board meeting.

Attorney Chuck Fadeley arrived for the meeting at 11:50 am.

Policy Review

Dave D’Avanzo, Manager of Member Service reported on the policies subject to review:

Policy 202 (Management & Protection & Personal Health Information): Upon motion made and properly seconded it was approved to adopt Policy 202 (Management & Protection & Personal Health Information) as amended and presented. The motion was approved by unanimous vote.

Policy 401 (Financial Management Authority): Upon motion made and properly seconded it was moved to approve Policy 401 (Financial Management Authority) as presented. The motion was approved by unanimous vote.

Donation Request

Northwest Youth Corps – Upon motion made and properly seconded it was approved to donate $400 to the Northwest Youth Corps. The motion was approved by unanimous vote.

United Way of Lane County – Upon motion made and properly seconded it was approved a dollar for dollar match to the United Way of Lane County. The motion was approved by unanimous vote.

Strategic Plan Review

Staff provided the quarterly review of the progress, goals, objectives and initiatives of the Cooperative’s strategic plan. Discussion followed.

Resolution 3-14 – PNGC Director Nomination

Mr. Crinklaw explained that the August 5 PNGC board of directors meeting was the last one he would serve as a director for Lane Electric. It is now necessary to nominate an individual to serve the remaining year of his three year term. Due to the operational nature of the duties and responsibilities of a PNGC director it was recommended to select Matt Michel to fill the remaining portion of the term. Upon motion made and properly seconded it was moved to adopt Resolution 3-14, a resolution nominating Matt Michel to serve on the Pacific Northwest Generating Cooperative’s board of directors; and approve the Certificate of Director Nomination declaring Matt Michel as Lane Electric Cooperative’s nominee as a director for the Pacific Northwest Generating Cooperative. The motion was approved by unanimous vote.

Upon motion made and properly seconded it was moved to appoint Jeri Nelson to serve as Lane Electric Cooperative’s membership representative at membership meetings of the Pacific Northwest Generating Cooperative; and that Matt Michel serve as the Cooperative’s alternate representative.

Select Recipient for “Member of the Year Award”

Upon motion made and properly seconded it was approved to select Mr. George Letchworth to be the recipient of the “Larry Erickson Member of the Year Award” and that the award be presented at one of the Cooperative’s upcoming District Meetings, or a another time and location more suitable to the recipient. The motion was approved by unanimous vote.

Consideration of Four 10-Hour Day Workweek

Mr. Crinklaw explained the background for consideration of four 10-hour day workweek. He presented information and analysis regarding the merits of 4-10’s for Unit B. He explained the decision regarding if, how or when to proceed in the future must have the new General Managers influence and recommendation.

Review Insurance Renewals

Debi Wilson gave an update on the renewal status of a variety of insurance coverage. She reported
The cooperative’s medical and dental insurance will expire on 12/31/14, and workers compensation insurance will expire on 09/30/14.

2015 Budget Considerations

Debi Wilson, Manager Office & Staff Services, along with Cynthia Scoble, Controller, provided a review of the budget preparation process. They reviewed and discussed general assumptions, anticipated and known influences, and how the budget could be affected by items in the strategic plan. It is expected to have the first draft, “Version 1”, available and distributed the third week in October.

Financial Report

Cynthia Scoble, along with Debi Wilson reported on the financial condition of the Cooperative for the period ending July 2014.

Safety Program Report

Tony Toncray, Manager of Construction & Maintenance, reported the Office safety meeting was held on August 21st and the topic was “Spill Response” and the Construction and Maintenance safety meeting will be held on August 28th. The topic will be “New Incident Fact Finding Report”. He also reported on the status of the Employee Safety Program through the end of July and reported there have been 697 days without a time loss injury.

• Agenda Items for September 22

o Donations
o Adoption of the 10-year Construction Work Plan
o Workers Compensation Insurance Renewal
o Dental Insurance Renewal
o Review CFC KRTA
o Appoint ACRE representative

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 4:30 p.m.