Public Utilities 2024/08/28CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
August 28, 2024
The agenda having been posted on Thursday, August 22, 2024, the Regular Meeting of the Public Utilities
Board (Board) was called to order by Chairperson John Seymour at 5:00 p.m. on Wednesday, August 28,
2024, in the Gordon Hoyt Conference Center, 2r'd floor, Anaheim West Tower, 201 S. Anaheim Blvd.,
Anaheim, California.
Board Members Present: Chairperson John Seymour, Vice -Chairperson A. Abdulrahman, M. Lee,
A. Pham, A. McMenamin, T. Ibrahim
Board Members Absent: T. Bilezikjian
City Staff Present:
Guest(s) Present:
D. Lee, P. Starr, B. Beelner,
M. Avelino -Walker, A. Lee,
S. He, J. Wei, B. Fruchter, C.
M. Hernandez, C. Hernandez
AGENDA ITEM
1. PUBLIC COMMENTS.
C. Parker, J. Lonneker, J. Lehman,
T. Chen, M. Seifen, A. Nguyen, E. Krause,
Pereyra, G. Galvan
2. APPROVE THE MINUTES OF THE REGULAR MEETING OF
JULY 24, 2024. *
3. RECOMMEND INTRODUCTION OF AN ORDINANCE
AMENDING CHAPTER 1.04.310 AND ADDING CHAPTER
1.04.312 OF THE ANAHEIM MUNICIPAL CODE
AUTHORIZING THE PUBLIC UTILITIES GENERAL
MANAGER TO CONTRACT OR PROCURE EQUIPMENT,
MATERIALS, SUPPLIES, AND SUPPORT SERVICES USED
FOR EMERGENCY REPAIRS, OPERATING, MAINTAINING,
AND CONSTRUCTING ELECTRIC AND WATER UTILITY
ACTION TAKEN
There being no electronic or
oral public comments,
Chairperson J. Seymour
closed the public comments
portion of the meeting.
M. Lee moved the Approval
of the Minutes of the Regular
Meeting of July 24, 2024.
A. McMenamin seconded the
motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1.
[T. Bilezikjian]
A. Abdulrahman moved the
Introduction and Adoption of
the Ordinance Amending
Chapter 1.04.310 and Adding
Chapter 1.04.312 of the
Anaheim Municipal Code
and Approval of the
Agreement with
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INFRASTRUCTURE, UP TO $3,000,000 PER PROCUREMENT ProcureAbility, Inc. A. Pham
AWARD; AND APPROVE AN AGREEMENT WITH
seconded the motion.
PROCUREABILITY, INC. FOR STRATEGIC SOURCING AND
MOTION CARRIED: 6-0.
PROCUREMENT SERVICES FOR A FIVE-YEAR TERM AND
ABSTAINED: 0.
TWO (2) OPTIONAL TWO-YEAR EXTENSIONS, IN AN
ABSENT. 1.
AVERAGE ANNUAL NOT -TO -EXCEED AMOUNT OF
[T. Bilezikjian]
$1,503,704, PLUS 15% FOR AS -NEEDED EXTRA SERVICES.
A. Nguyen, Utilities Financial Planning Manager, provided an overview
of the recommended actions, describing how the global supply chain
challenges have increased lead times, resulting in price volatility and
difficulty securing equipment purchases, and how APU is at a
disadvantage when competing with larger utilities for equipment in short
supply. A. Nguyen briefed the Board on three main strategies that
included consolidating equipment purchases with other municipal
utilities to increase buying power; sourcing equipment and materials
globally due to insufficient domestic production; and contracting with an
experienced procurement services firm with a global network of
suppliers.
Explaining how to implement these strategies, A. Nguyen proposed
limited, delegated purchasing authority so that purchases up to $3
million could be expedited and orders placed to secure equipment. This
requested authority is not unlike wholesale power purchases through the
spot market, where speed of decision -making is necessary to supply
power when needed.
A. Nguyen also described the process of engaging with a qualified
procurement services firm, indicating that after a two -stage solicitation
process, staff ranked ProcureAbility with the highest evaluation score,
reflecting the firm's experience with both investor -owned and publicly
owned utilities, and their ability to source globally and consolidate
purchases.
The Board inquired whether sole source purchases were included as part
of the Anaheim Public Utilities' (APU) proposed delegated purchasing
authority. A. Nguyen clarified that it was not and that any sole source
purchases would still require City Council approval. The Board asked
how staff formulated the transaction limit. D. Lee, Public Utilities
General Manager, explained that the transaction limit mirrored the
APU's design -bid authority and also represented an amount needed to
purchase a sufficient quantity of critical equipment.
4. APPROVE A LICENSE AND SERVICES AGREEMENT WITH
M. Lee moved the Approval,
INORIA INC., WHICH IS IN SUBSTANTIALLY FINAL FORM,
in substantial form, of the
THE FINAL FORM OF WHICH SHALL BE CONCLUSIVELY
License and Services
EVIDENCED BY THE EXECUTION AND DELIVERY
Agreement with Inoria Inc.
THEREOF, FOR A FIVE (5) YEAR AND FOUR (4) MONTH
and the Approval, in
TERM FOR CONTACT CENTER SOLUTION LICENSE
substantial form, of the
SUBSCRIPTIONS, TELEPHONE CARRIER, AND SUPPORT
Implementation Services
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SERVICES IN AMOUNTS NOT TO EXCEED AN ANNUAL
AVERAGE OF $260,000, AN ANNUAL CONTINGENCY OF 20%,
AN ANNUAL ALLOWANCE NOT TO EXCEED $75,000 FOR AS -
NEEDED PROFESSIONAL SERVICES, ALLOWING UNUSED
ANNUAL ALLOWANCE TO CARRY OVER TO THE
FOLLOWING YEAR; AND UP TO FIVE (5) ONE-YEAR
EXTENSIONS, AS LONG AS COSTS DO NOT EXCEED 5%
OVER THE PRIOR YEAR'S COSTS, AND APPROVE AN
IMPLEMENTATION SERVICES AGREEMENT WITH
CARAHSOFT CORPORATION TO UPGRADE THE
CUSTOMER SERVICE CONTACT CENTER SOLUTION AT NO
COST. *
J. Lehman, Assistant General Manager — Administration & Risk
Services, briefed the Board on the agreements for services needed to
upgrade and maintain the Customer Service telephone and contact center
management system, which includes Interactive Voice Response system
(IVR). The current system, provided by Genesys Cloud Services, Inc.,
was near its end of life and would soon no longer be supported. J.
Lehman explained the need for the system for communications with
customers.
The Board inquired if APU ran into any challenges working with a
company that is not located in the United States. J. Lehman shared that
staff confirmed that they are approved to work in California and meet all
of the licensing requirements. The Board asked if the software has
accessibility services. B. Fruchter, Enterprise Information Technology
Manager, said he will look into the services provided and get back to the
Board. The Board inquired what the systems specifically include. J.
Lehman shared that it includes the telephones, IVR, as well as tools that
allow for staff scheduling based on past call volumes, and other features.
5. APPROVE A SOFTWARE SERVICES AGREEMENT WITH
POWER MARKET CONSULTING, INC., WHICH IS IN
SUBSTANTIALLY FINAL FORM, THE FINAL FORM OF
WHICH SHALL BE CONCLUSIVELY EVIDENCED BY THE
EXECUTION AND DELIVERY THEREOF, FOR HIGH
VOLTAGE TRANSMISSION ANALYTICS SOFTWARE AND
RELATED SERVICES WITH AN INITIAL TERM OF FIVE (5)
YEARS AND FIVE (5) ONE-YEAR EXTENSION OPTIONS, FOR
A NOT -TO -EXCEED AMOUNT OF $26,000 FOR
IMPLEMENTATION SERVICES, AN AVERAGE ANNUAL
SUBSCRIPTION COST OF $135,000 PER YEAR FOR THE
INITIAL TERM, PLUS A 10% CONTINGENCY DURING THE
TERM, AND ALLOWING SUBSCRIPTION FEE AND
CONSULTANT RATE INCREASES OF UP TO 14.83% FOR THE
FIRST EXTENSION, AND 5% DURING ANY SUBSEQUENT
EXTENSION.
Agreement with Carahsoft
Corporation. T. Ibrahim
seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1.
[T. Bilezikjian]
Staff will review accessibility
features and inform the
Board.
A. Abdulrahman moved the
Approval, in substantial
form, of the Software
Services Agreement with
Power Market Consulting,
Inc. A. McMenamin
seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1.
[T. Bilezikjian]
2024 - 72
B. Beelner, Assistant General Manager — Finance and Energy
Resources, briefed the board on the Software Services Agreement with
Power Market Consulting, Inc. (PMCI), to provide High Voltage
Transmission Analytics Software and related services at an average
annual subscription cost of $135,000 per year.
APU staff issued a Request for Proposals (RFP) for transmission
analytics software and related consulting services for Congestion
Revenue Rights (CRRs) due to the highly specialized software, PMCI
was the only proposal received by APU.
B. Beelner explained that the software allows APU to select the optimal
transmission paths to offset transmission congestion costs, reducing
overall costs to supply power to Anaheim. The proposal was evaluated
and met the RFP requirements and APU is recommending an agreement
with PMCI for a five-year term with five one-year optional extensions.
The Board inquired how much the $135,000 software saves APU.
E. Krause, Integrated Resources Manager, responded that the software
allows APU to offset approximately $4 million in congestion cost
annually. E. Krause elaborated that without such software, it would be
difficult and time-consuming work utilizing spreadsheets and limited
data, resulting in much lower offsets.
6. APPROVE AN AGREEMENT WITH DOBLE ENGINEERING
COMPANY TO LEASE POWER FACTOR TEST SET
EQUIPMENT AND PERFORM DISSOLVED -GAS -ANALYSIS
LABORATORY TESTING SERVICES TOGETHER WITH A
SUBSCRIPTION FOR ASSOCIATED DATA MANAGEMENT
SOFTWARE, FOR AN INITIAL TERM OF FIVE (5) YEARS
WITH FIVE (5) ONE-YEAR OPTIONAL RENEWALS, AT AN
AVERAGE NOT -TO -EXCEED COST OF $60,588 PER YEAR
FOR THE INITIAL TERM AND AN AVERAGE NOT -TO -
EXCEED COST OF $71,412 PER OPTIONAL RENEWAL YEAR,
WITH A 15% CONTINGENCY FOR AS -NEEDED EXTRA
SERVICES. *
J. Lonneker, Assistant General Manager — Electric Services, informed
the Board of the need to conduct periodic maintenance testing on the
high voltage equipment insulation system to determine its rate of
deterioration. Industry standards for testing the insulation is called a
Power Factor Test (PF) and Dissolved Gas Analysis (DGA). These tests
indicate the level of moisture within the equipment and if elevated gas
levels exist which can breakdown the integrity of the insulating oil.
The agreement for testing services with Doble Engineering Company
(Agreement) includes leasing the testing equipment including annual
calibration and maintenance, coupled with software that contains an
extensive library of data and algorithms to identify trending anomalies
present in the insulation along with temperature variation and status of
A. Pham moved the Approval
of an Agreement with Doble
Engineering Company.
A. Abdulrahman seconded
the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1.
[T. Bilezikjian]
2024 - 73
cooling equipment. This data is accessed through a cloud -based portal
for APU substation crews to access and plan maintenance. J. Lonneker
explained that the terms and conditions of the Agreement for the first
five years includes a fixed cost component for initial set up, the cost of
the leased equipment and engineering support for calibration and
software analysis plus a lab testing component which includes a menu of
varying tests specific to the type of equipment and therefore established
a not -to -exceed annual cost of $60,588 for the initial term plus a 15%
contingency. J. Lonneker added that after the first five years, there is an
option to renew the contract annually up to an additional five years.
The Board asked how many pieces of equipment this includes. Staff
responded that there is one that is rotated between substations, which is
sufficient for the scope of services requested.
7. UPDATE ON ELECTRIC SYSTEM ITEMS.
J. Lonneker updated the Board on recurring outages on Country Club
Lane due to underground direct buried cable failures. There is an
ongoing replacement project, which is under construction. Due to
multiple outages, generators were put in place until the completion of
the cable replacement work in approximately two weeks.
J. Lonneker shared with the Board a video of substation maintenance
work performed by APU crews known as Hot Washing which prevents
electrical arcing due to dust buildup. J. Lonneker explained that water
from APU's Canyon Power Plant, which is purified from the Orange
County Water District's (OCWD) groundwater replenishment system, is
used for this purpose.
The Board inquired about an outage that occurred the prior week.
J. Lonneker explained that it was caused by Mylar balloons.
8. UPDATE ON WATER SYSTEM ITEMS.
C. Parker, Assistant General Manager — Water Services, stated that the
Orange County Groundwater Basin is in good shape and that OCWD is
currently preparing the recharge basins for the next storm season. The
State Water Project (SWP) is in good condition. There was a fire near
Lake Oroville, but no there was no damage to the lake facilities. The
Metropolitan Water District of Southern California's (MWD) share of
the SWP will have a 400-thousand-acre feet (TAF) carryover to next
year, which means this water can be put into SWP storage for future use.
There is not much change on the Colorado River Basin — the seven states
are still negotiating a deal to use less water. MWD will be putting about
300 TAF into their own storage this year, which means overall storage
may increase to 3.7-million-acre feet (MAF), which is a little less than
three years of water use for MWD. MWD also started to look at revising
their rate structure due to less demand. Member agencies, such as APU,
have been asked to participate in these discussions.
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C. Parker announced that he and J. Hester, Water Engineering Manager,
have been asked to present at a Per- and polyfluoroalkyl substances
(PFAS) American Water Works Association (AWWA) Conference in
Chicago in December. This presentation will provide other agencies
information before they start their groundwater treatment programs.
Lastly, C. Parker reported that Water Operations assisted Anaheim Fire
and Rescue (AFR) in fighting the fire that occurred near Ball Road and
State College Boulevard. AFR requested more water pressure, so Water
Operations turned on an MWD turnout to provide the necessary water
pressure to fight the fire. The Board asked if Water Operations has had
to turn on an MWD turnout before to fight a fire. C. Parker stated that he
was not aware of a prior incident.
9. UPDATE ON FINANCE AND ENERGY RESOURCES ITEMS.
B. Beelner discussed the monthly Finance Dashboard with the Board
through July 2024. B. Beelner mentioned that year to date electric
operating expenditures were 37.9% ($16.6 M) was 4.9% ($17.7M)
below budget primarily due to lower fuel and power supply costs.
B. Beelner informed the Board that natural gas prices have been
seasonally low for the summer causing APU to run the Canyon Power
Plant more than normal at lower cost. Additionally, wholesale power
costs have also been lower than normal for the summer allowing for
APU to purchase wholesale power at lower -than -expected costs.
The Board inquired on the status of the Canyon Unit 1 repairs.
B. Beelner responded that bids have been received from the RFP issued
and the winning bidder may be able to complete the work sooner than
anticipated, but there is no guarantee of that happening. The Board then
asked about the status of the Roadhouse Energy Storage Project and
B. Beelner responded that groundbreaking will occur in approximately a
month and is planned to be online by 2027 to replace the capacity lost
with APU's exit from Intermountain Power Project.
B. Beelner then discussed the recent bond financing with the Board and
stated that the electric bond re -financing reduced future interest costs by
approximately $18 million with the majority of those savings occurring
between the years of 2040-2045, D. Lee reminded the Board that APU
anticipated savings of approximately $7 million, so this re -financing
exceeded expectations.
10. UPDATE ON ADMINISTRATION AND RISK SERVICES ITEMS.
J. Lehman provided the Board with an update on the Internal
Compliance Plan. J. Lehman provided information on the settlement
with the South Coast Air Quality Management District (SCAQMD)
regarding four violations at the Canyon Power Plant in 2022 and 2023.
Three of the violations were related to minor incidents that occurred
during operations and maintenance, and the fourth was related to
running the power plant during a grid emergency in 2022 at the request
2024 - 75
of the Governor's office. J. Lehman shared that when the operational
violations were first reported that the plant operators were retrained, and
that there have not been any similar occurrences. The total settlement
amount was $4,836.
J. Lehman provided an update on the Administration and Risk Services
Dashboard and shared upcoming key dates in the remaining weeks of the
legislative session, and discussed the following active bills:
• AB 1820, AB 3012, SB 1210 — Housing Development Fee
Estimates: these bills are being watched by APU;
• AB 2561 — Local Public Employees: Vacant Positions: this bill is
being watched by APU; and
• AB 1834 — Energy Market Design Clean -Up: this bill is being
supported by APU.
J. Lehman then reviewed the safety metrics and shared that there had
been two minor injuries during the reporting period. APU continued to
meet its safety metrics, and training helps raise attention to safety
matters.
11. ITEMS BY SECRETARY.
D. Lee shared agenda items for next month:
• Public Hearing and Approval of Underground District
Formation;
• Ordinance regarding the removal of Overhead
Telecommunication Facilities on Underground Projects;
• FY 2024 Utilities Success Indicators; and,
• Water Quality Testing Agreement.
D. Lee shared the following updates:
• Board Members will receive an invitation from the City Clerk's
office for a Boards and Commissions appreciation dinner, which
is scheduled for October 15t';
• APU attended National Night Out that was hosted by the
Anaheim Police Department;
• APU added streetlights to existing utility poles and installed new
streetlights to replace aging ones; APU hosted a lighting
distribution event where Dusk to Dawn lights were distributed to
area residents;
• A community meeting was held at the request of residents at a
new development on Euclid and Lincoln; APU, Police, Code
Enforcement and Housing participated to talk about ways in
assisting with their concerns with lighting, homelessness, and
safety;
• The City hosted one of its Sister Cities — Mito, Japan where
Junior High students came to participate and stayed with a
number of residents in Anaheim and toured the electric control
room;
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• APU staff attended Back -to -School events to support local
students;
• Sustainability Education Center — grading activities have started
and the construction will take about a year; and,
• Boysen Park — as part of the groundwater treatment program,
Water Services staff collaborated with the Parks Division to
make improvements to the existing well site and screen the new
treatment vessels.
Lastly, D. Lee requested that the Board meeting be closed in memory of
Kathie Hornick, a 24-year APU employee who worked in the Electric
Services Division as a Senior Office Specialist.
12. ITEMS BY BOARD MEMBERS.
A. Pham thanked APU for participating in community events; there was
a huge turnout for the back -to -school event and appreciates APU's
support of students and residents.
M. Lee recognized J. Lonneker for reaching out to him with regards to a
power outage; he appreciated the communication.
A. Abdulrahman thanked J. Lonneker for her updating the community
and keeping the Board updated on power outages.
J. Seymour inquired who was responsible for the median landscaping on
Santa Ana Canyon Road; J. Lonneker responded that the Public Works
Department was responsible for the landscaping and APU provided
support by running electric service to irrigation controllers.
13. ADJOURN: (NEXT PUBLIC HEARINGS/REGULAR MEETING
ON SEPTEMBER 25, 2024, AT 5:00 P.M.)
Respectfully submitted,
1
Dukku Lee -
Public Utilities General Manager
A. Abdulrahman moved to
Adjourn the Regular Meeting
in the Gordon Hoyt
Conference Center at 6:18
p.m. to the Board's Public
Hearings/Regular Meeting
date of September 25, 2024,
at 5:00 p.m. T. Ibrahim
seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1.
[T. Bilezikjian]
* Indicates item(s) that will be forwarded to City Council for action upon recommendation by the Board.
** Indicates item(s) that will be forwarded to the City Clerk and City Council for informational purposes.
2024 - 77