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Public Utilities 2017/05/24CITY OF ANAHEIM 1416 MOM The agenda having been posted on Thursday, May 18, 2017, the Regular Meeting of the Public Utilities Board (Board) was called to order by Chairperson J. Machiaverna. at 5:07 p.m. on Wednesday, May 24, 2017, in the I Ph Floor Large Conference Room, Anaheim West Tower, 201 S. Anaheim Blvd., Anaheim, Cafifor-tia. Board Members Present- Chairperson J. Machiavema, A. Abdulrahm,an, E. MedranoJ. Showalt V. Barold], R. Nelson, J. Seymour, V. Ramirez I ITIrtm-3 Staff Present- D. Lee, L. Quiambao, M. Moore, J. Lonneker, B. Beelner, A. Kott, G. Bowen, J. Lehman, P. Oviedo, A. Kanzler, M. Selfen, D. Albaugh, A. Nguyen, C. Pereyra, Y. Saldivar, A. Muniz Guest(s) Present: None. AGENDAITEM ACTION TAKEN I *10i 11-ljvftomfflffl� NMI" 041 1*, service and commitment to, ensuning that Anaheim utility customers receive high service reliability at competitive rates. 'Utility staff thanked him for his dedication andPresented him with a plaque and proclamation of recogon. Chairperson Machiavema thanked the current Board members and staft and welcomed the new Board members. Chairperson Machiaverna wished everyone well and departed from the meeting at 5:12 pm. 1. OATH OF OFFICE FOR NEW PUBLIC UTILITIES BOARD MEMBERS. P. Oviedo, Administrative Assistant, administered the oath to newly elected and reappointed members of the Board, I SIII I MEMO I MOM, F&I I a W1143-1=4 0F.191 12111 Lei Offe of" I H 131,17-cl A. Kott, Assistant City Attorney, opened the floor for By voice vote, the Board nominations for Chairperson. J. Seymour nominated E. Medrano, elected E. Medrano as 2017-37 ITEM NO. 01 who accepted the nomination, A. Abdulrahman moved to close Chairperson of the Public the nominations and R. Nelson seconded the motion. By voice Utilities Board. vote, the Public Utilities Board members unanimously voted to MOTION CARRIED: 7-0. close the nominations,. By voice vote, the Public Utilities Board ABSTAINED: 0. members elected E. MedTano as the Chairperson of the Public ABSENT: 0. Utilities Board. Boice vote, the Board A. Kott then opened the: floor for nominations for the Vice- elected j. Seymour as Vice - Chairperson. A. Abdulrahman norninated J. Seymour who Chairperson of the Public accepted the nomination. E. Medrano moved to close the Utilities Board. nominations and R. Nelson seconded the motion. By voice vote, MOTION CARRIED: 7-0. the Board members unanimously voted to close the nominations. ABSTAfNED: 0. By voice vote, the Board members elected J. Seymour to the A13SENT: 0. position of Vice-Chairpersori of the Public 'Utilities Board. 3. PUBLIC CO NTS.. There being no public comments, Chairperson E. No Public Comments. Medrano closed the public comments portion of the meeting, 4. RECEIVE AND FILE MINUTES OF THE PUBLIC A. Abdulrabman moved UTILITES BOARD MEETING OF APRIL 26, 201.7. approval to receive and file the Minutes of the Regular Public Utilities Board Meeting of April 26, 2017. J. Seymour seconded the motion, MOTION CARRIED: 7-0. ABSTAINED- 10. ABSENT: 0. D. Lee provided an overview of the Board, and provided reference to the City Charter Section 909 that describes the duties and responsibilities of the Board. He explained how the Public Utilities Department (Department) is organized and the organizational goals and objectives. J. Lehman, Chief Risk Officer, described how the Department engages in legislative activities to mitigate potential costs and risks, G. Bowen, Assistant General Manager — Power Supply, described how the regional power system works. J. Lonneker, Assistant General Manager — Electric Services, described how the local grid in the City of Anaheim (City) works. M. Moore, Assistant General Manager — Water Services:,, described how water is sourced and provided to the City. B. Beelner, Assistant General Manager — Finance and Administration, provided a financial overview, and referenced City Charter Section 1221 that describes what utility rates can recover, and he showed comparisons of the City's rates to other utilities serving Orange County. As part of the 2017-38 �1MIKIM 11131yo Und I MIT, M A. Kort opened the floor for nominations for three members, of' the Underground Conversion Subcommittee. J. Showalter self - nominated, V. Baroldi self -nominated, R.,'Nelso,n self -nominated, ,?,& �-Wulrahman self -nominated, J. Se igur-yw-ve-�- �QQ the nominations and V. Baroldi seconded the motion. By voice vote, the Board members unanimously voted to close the nominations. Because there were more than three candidates, the candidates were voted for in the order in which they were nominated, By show of hands the Board members elected J. Showalter, V. Baroldi, and A. Abdulrahman, to serve on the Underground Conversion Subcommittee. and one alternate to volunteer to serve on the Public Utilities Hearing Board. J. Seymour, A. Abdulrahman, and R. Nelson volunteered. J. Showalter volunteered as the alternate. Chairperson E. Medrano confirmed their appointment to the Public Utilities Hearing Board. Chairperson E, Medrano indicated he was seeking three volunteers to serve on the Ad Hoc Legislative Working Group. J. Seymour and V. Ramirez volunteered. Chairperson E. Medrano 4 i&v- aamAi�&kQ Ad Hoc Legislative Working Group. I a I I �Idor-1111 ho.0411 M -III 1:2 9 'kill OR! 01 M 11119] firl Do A. Nguyen, Utilities Budget Administrator, gave a presentation to the Board on the Fiscal Year 2018 (FYI 8) Proposed budget. For context, he provided a brief overview of the budget process:, compared t 017-18 Projected budget to the FY 2017-18 Amended budget, and highlighted some current year accomplishments, includ�ing the Department's engagement with schools, students, the community; customer service enhancements (or regulatory relief' initiatives); and planned projects to improve the Electric and Water Utility's reliability. 1 M R"I'l 161111 HAVAM Vat) K01 ON -1— 0-00- 0 C NO oil By show of hands, the Board elected J. Showalter, V. Baroldi, and A. AbIdulrahman to serve on the: Underground Conversion Subcommittee. MOTION CARRIED: 7-0. ABSTAINED. 0. NBSENT: 0. A. Abdulrahman moved approval of the recommendation on Fiscal Year 2017-2018 Proposed Budget. J. Seymoi MI ur seconded the motion. P6 ABSTAINED: 0. ABSENT: 0. due to a new substation that was budgeted last fiscal year. In addition, Electric Utility operating expenditures are decreasing completing debt service payments related to ownership of that plant. A. Nguyen indicated that the Electric Utility sales are expected to decrease because of the coal plant divestiture, as, ther+ w 'It be less power to sell on the wholesale market. I how total Water Utility expenditures will increase by almost 7% due to higher wholesale water costs as water wholesalers are investing in their infrastructure and drought resiliency projects. A. Nguyen remarked on how an already -approved rate change is expected to help increase water revenue by 5% to pay for those higher water supply costs. The Board asked if the FY 18 Projected budget was current, and B,. Beelner indicated that the: F:Y 18 Projected budget had not changed since the presentation that was given at the April 26, meetiw�, and the numbers need to be static in order for the budget Process to move forward. In addition, the Board commented on the budget format and expressed their interest in seeing a detailed breakdown pertaining to the Department's Power Supply and the Underground Conversion Program. A. Nguyen indicated that staff provides the Board with a high-level roll -up that is more accommodative for an executive or policy -body review. B. Be�elner acknowledg- r w Roard's comments, and mentioned that staff has utzed Di. Lee indicated that more infon-nation and presentations, will be given throughout the year, with sufficient context. 4 q 91 V MA1123 01 M J. Lonneker updated the Board on the progress of the steel _7,g3 --M OvWnrO - the 91 fteeway on Lincoln Avenue. This project will eliminate the overhead electric vn*res crossing above the 91 freeway and place them underground, thereby increasing the reliability of the electric system. The installation is part of the underground conversion project on Lincoln Avenue and Rio Vista and the bN ring should be complete in one month. J. Lonneker made the Board aware of an award given to the Department by the: American Public Power Association (APPA). The Reliable Public Power Provider Award was given to 235 N 1 of the approximately 2,000 public utilities across the nation who demonstrate a high proficiency level in four areas: Reliability, Safety, Workforce Development, and System Improvement. J. Lonneker indicated to the Board that the Department's electric system is amongst the top quartile for reliability of all utilities across the nation and continues to focus on infrastructure improvements and upgrades to maintain this level of reliability. ItIm" 2174111• M. Moore provided the Water Supply Dashboard to the Board which indicates that the imported water storage levels have improved significantly due to record precipitation. Locally, the groundwater level has slightly increased due to above average precipitation, M. Moore indicated that based on the improved local and imported water reservoir levels, the Department will be recommending to the Board at the June meeting, that the iTrigation:iii ndate be reduced for the City of Anaheim 141 JJ*j *J ed 6e Denag" residents on May 20, 2017., The residents were invited on-site; to learn about the two year construction project. Lastly, M. Moore indicated that the Orange County Water Summit will be held on June 16, 2017 in Anaheim and that the Nepartinent has seats available for the Board members who would like: to attend. rp',. Beelner informed the Board that the Department's Virtual Hold Technology system has been activated. This system gives customers the option to receive a call back from the Department's call center when their res,pective turn in the hold queue is up as opposed to waiting on hold, RX=- rsT=oT4TIrIJRMnTqTsfflJTG'offIin Vlf�* R3-raJMMTIMP =#a "IT, NMI IfIVIRT �.. below budget by 5i.9% ($19,8M) causing a year to date net budget variance of $27.2M. He then mentioned that year to date water revenue was 6.8% ($4.1 M) below budget due to continued conservation coupled with the signcant rainfall, however costs were 15.4% below budget ($8,7M) causing a positive net $4.6M budget variance. U "I G. Bowen provided the Board with an update on the Department's Water Poster Contest winners. He indicated to the Board that five of the 260 posters submitted would go on to the Metropolitan Water District's (MWD) 2018 calendar competition. ernail. with information about the Orange County Water Summit ev",t. G. Bowen also provided the Board with an update on MWD's Solar Cup Competition that was held at Lake Skinner on May 19 through May 21, 2017. G. Bowen explained that it is the nation's largest solar -powered boat competition and that more than 700 students from 43 high schools competed in the event. G. Bowen also indicated that Anaheim High School competed in the race and finished midway in the overall rankings. .11 1 1 too' QOW96140.111 Went ns•NIIIII 1 4 low, IWAWN IM *3 IN. 0" jorop MTN 11 LneLpEOTTIMM. f1sjr"I IT I ner-MUNY Canyon and Kraemer power plants were placed in routine maintenance mode to prepare them for operation during the summer. G. Bowen explained that the Renewable Portfolio -nergy output is beginning to decline as they head into the siruw.er.w-a.*As. j. Lehman provided the Board with an update on legislative zffairs, indicating that currently the Department is following over 150 bills that have the potential to impact operations. J. Lehman shared that key legislative deadlines were approaching that may vignificantly narrow the number of bills this year. J. Lehman made the Board aware of a bill that would potentially increase the Renewable Portfolio Standard (RPS) to 100% by 2045, which would increase Electric Utility costs, as well as a bill to eliminate the freely allocated Greenhouse Gas allowances that could also increase costs, depending upon how the program was structured. J. Lehman explained that the Department was working on addressing these issues to ensure customer impacts, including costs are considered. Furthermore, J. Lehman mentioned that the efforts to legislate long-term water conservation measures is underway, there are however several bills that would provide flexibility in how customers and utilities reviewing to possibly support. Lastly, J. Lehman asked the Board if the Legislative Working Group could meet in June to review the key bills in this legislative session. She indicated that she would send out a meeting notice, as well as the supporting documents for the meeting. KJIVAI M. — 1111,111-311 D. Lee informed the Board that a presentation on the Brown Act would be forthcoming,. He stated that he: provides, email updates to the Board on utility matters and if the Board has questions, they should direct their questions to him. He also indicated that an emergency form has been provided since Board members may be attending tours in the future. He requested that Board members return the emergency forms after they have: been filled 1171 V)n protos"17IIII Proposed and FYI 7 Adopted budget was informative. Sheis looking forward to working with the Department and mentioned she was impressed with the professionalism that was shown by staff. V. Baroildi confirmed the next meeting date of June 28, 2017. D, Lee stated that the meetings normally, occur on the fourth Wednesday of each month except in November and December. A. Abdulrahman welcomed the new Board members and I MIT =LML 77-7077 . aV, I L 'orw ard to being a part of the Board. E. Medrano welcomied the new Board members, He appreciated the Department's continued efforts, of putting cus�tomer's first. He encouraged the new Board members to participate in the different tours and events that the Department offers to educate them on utility matters,. wj� # "W1,75 I WiW1 R *44 11 W--1 114,75 131 A N laffew I Respect submitted, Wukku Lee rl'ublic Utilities General Manage A. Abdulrahman moved approval to adjourn the Regular Meeting at 7:33 p.m., to the Board's Regular Meeting date of June 28, 2017 at 5:00 p.m. J. Seymour seconded the motion. MOTION CARRIED: 7-0. ABSTAIINED: 0. ABSENT: 0. Indicates itern(s) that will be forwarded to City Council for action upon recommendation by the Board. Indicates item(s) that will be forwarded to City Clerk and City Council for informational purposes.