Lane Electric - A Touchstone Energy Cooperative

03-23-15

Minutes of the Board of Directors’ Meeting March 23, 2015

The Lane Electric Cooperative, Inc. (LEC) Board of Directors convened on March 23, 2015 at the LEC corporate office at 787 Bailey Hill Road in Eugene, Oregon.

Call to Order
President Christopher B. Seubert called to order the LEC Board regular monthly meeting around 10 AM with a quorum present. Directors present were: Secretary/Treasurer Jack Billings and directors Charles E. Bangle, Jeri Nelson, J. Ingrid Kessler, and Kathy Keable. Vice-President Susan Knudsen Obermeyer was not present.

Also present at different times in the meeting were: Charles N. Fadeley, LEC attorney (arrived around 10 AM); Matt Michel, General Manager; Tony Toncray, Manager of Construction & Maintenance; Debi Wilson, Manager of Office & Staff Services; Cynthia Scoble, Controller; Dave D’Avanzo, Manager of Member Services; Doug Stockdale, Manager of Engineering Services; Brenda Everts, Executive Secretary; Denisa Bradley, Junior Accountant; John Murray, Energy Services; Zechariah English, Energy Services; Roger Gray, Eugene Water and Electric Board (EWEB) General Manager; John Simpson, EWEB Commissioner.
General Manager Michel acted as recording secretary. Member Input
There were no members present.

Approval of Agenda
President Seubert asked if there were additions or amendments to the agenda. The director vacancy appointment process was added to the agenda. President Seubert declared the agenda approved as amended.

Approval of Minutes
President Seubert asked if there were additions or corrections to the February 17, 2015 board meeting minutes. The Board amended the minutes to clarify that Director Kessler attended one safety meeting, not more than one. President Seubert declared the minutes approved as amended.

Safety Program Report
Manager Tony Toncray reported on the February Office and outside Construction and Maintenance safety meetings, and the Employee Safety Program through February. He also reported on Lane Electric’s ergonomic training and recent loss-time accident. Discussion occurred.

Financial Report
Controller Cynthia Scoble along with Manager Debi Wilson reported on LEC’s financial condition for the period ending February 2015. Discussion occurred about warm weather effects on budget expectations.

Manager Wilson presented a staff recommendation to accept bids for casualty & liability insurance and cyber security insurance renewals. Discussion occurred. Upon motion made and seconded, the Board approved renewing property and casualty insurance coverage with Federated Rural Insurance Exchange and Hurtado & Associates for Cyber Risk coverage.
Reports
President Chris Seubert reported that Director Bangle had submitted a written resignation letter effective after adjournment of the May 26, 2015 meeting. Discussion occurred.

Annual Meeting Committee Report: Director Nelson reported on plans for the 2015 annual and district meetings. Discussion occurred. The Board gave guidance in support of a potential bylaw amendment to hold the annual meeting in the 2nd quarter (April, May, June) timeframe; district meetings to be scheduled the week of August 17th; conducting the 2015 Annual Meeting in late afternoon at the August 22nd “big tent” event; holding district meetings in late afternoon; and having the general manager research voting improvements.

Director Reports: President Seubert reported that on February 23, 2015 the board of directors met at the LEC headquarters to create a document that will be used for the General Manager evaluation. All directors were present and participated. Using an existing template and reviewing the expectations of the General Manager from the policies, the board created a document that reflects the values and expectations of the General Manager’s performance.

Director Nelson reported on changes to the director’s expense form and travel request form. Discussion occurred.

ORECA: Director Seubert asked for comments on the recent ORECA Legislative Event. Discussion occurred.

ORECA Government Affairs Committee (GAC): General Manager Michel reported on legislation concerning service disconnections, solar generation, and other relevant legislation.

General Manager: General Manager Michel shared thank-you notes received and reported on: The PNGC Board of Directors’ meeting, BPA matters, capital expenditures over ten thousand dollars, community and training events, and upcoming events.

Policy Review
General Manager Michel presented Policy 107 (General Manager Search & Selection) for review. Discussion occurred. Upon motion made and seconded, the Board adopted Policy 107 (General Manager Search & Selection) as amended.

General Manager Michel presented Policy 211 (Employee Holiday & Leave Privileges) for first review and recommended postponing formal review until legislative changes are finalized in late summer. Discussion occurred.

General Manager Michel presented Policy 605 (Multi-purpose Room Use) for review. Discussion occurred. Upon motion made and seconded, the Board adopted Policy 605 (Multi-purpose Room Use) as presented.

General Manager Michel presented Policy 310 (Energy Conservation Programs) for first review. Discussion occurred. Upon motion made and seconded, the Board adopted Policy 310 (Energy Conservation Programs) as amended.

EWEB’s Carbon Tax Perspective
Eugene Water and Electric Board (EWEB) General Manager Roger Gray and EWEB Commissioner John Simpson presented EWEB’s policy position on carbon pricing. Discussion occurred.
Appointments
President Seubert asked for nominations. Upon motion made and seconded, the Board appointed Jeri Nelson, with Kathy Keable as alternate, as Lane Electric’s NWPPA voting delegate for calendar year 2015. Upon motion made and seconded, the Board appointed General Manager Matt Michel as Lane Electric’s CRC voting delegate for calendar year 2015.

Member Appointments Committee
President Seubert asked for action on the Member Appointments Committee. Upon motion made and seconded, the Board authorized the Member Appointments Committee to make timely appointments for vacancies on the Nominating Committee and the Elections & Credentials Committee.

LEC Audit Committee Meeting
The Lane Electric Cooperative Audit Committee came to order at 1:35 p.m. on March 23, 2015 at the Cooperative’s headquarters. The Committee members, being all the directors of Lane Electric Cooperative, except for Director Knudsen-Obermeyer, 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 an unmodified (clean) opinion on the financial statements. The Governance Letter had no exceptions.

Mr. Kuhns went over significant highlights in the 2014 audit report, including:
1. Total assets and investments in associated organizations.
2. Ratio of equity to total assets was good (equity was 39.2%, up 0.5% from last year).
3. Long-term and short-term borrowing and debt.
4. Margins up substantially.
5. Deferred credits that reduced power costs over several years have been used up.
6. Capital credits retirements and the impact on equity of discounted retirements.
7. Additional internal controls and eligibility auditing standards required due to receipt of government (FEMA) funds.

The Committee then went into executive session with the auditor. The Board then reconvened into regular session. It was moved and seconded to accept the 2014 audit report as prepared and presented by Kenneth Kuhns & Co. The motion passed unanimously.

Agenda Items for April 27
President Seubert reviewed next month’s agenda items to include Director Billings’ lunchtime presentation on the Energy Facility Siting Council.

Executive Session
The directors along with Mr. Michel, Mr. Fadeley, and Mr. D’Avanzo entered into executive session. General Manager Michel presented on solar generation. President Seubert reported on the general manager evaluation process and the director appointment process.

Adjournment
Being no further business to come before the Board, President Seubert adjourned the meeting at approximately 3:20 p.m.