Public Utilities 2021/12/15CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
December 15, 2021
The agenda having been posted on Friday, December 10, 2021, the Regular Meeting of the Public
Utilities Board (Board) was called to order by Chairperson J. Seymour at 5:00 p.m. on Wednesday,
December 15, 2021, in the Gordon Hoyt Conference Center, 2nd floor, Anaheim West Tower, 201 S.
Anaheim Blvd., Anaheim, California.
Board Members Present: Chairperson J. Seymour, Vice -Chairperson V. Baroldi, R. Bhalla, A.
Abdulrahman, R. Gaona, N. Campos Kurtz, M. Lee
Board Members Absent: None.
City Staff Present: D. Lee, P. Starr, A. Kott, B. Beelner, M. Avelino -Walker, C. Parker,
J. Sanks, M. Seifen, C. Pereyra, F. Barvarz
Guest(s) Present: None.
AGENDA ITEM ACTION TAKEN
1. PUBLIC COMMENTS.
2. APPROVAL OF THE MINUTES OF THE PUBLIC
UTILITIES BOARD REGULAR MEETING OF NOVEMBER
17, 2021. *
3. PROPOSED MODIFICATIONS TO THE ELECTRIC AND
WATER RATES, RULES AND REGULATIONS.
A. Nguyen, Utilities Financial Planning Manager, presented the
proposed modifications to Anaheim Public Utilities (APU) Electric
and Water Rates, Rules, and Regulations, starting with an overview
There being no electronic or
oral public comments,
Chairperson J. Seymour
closed the public comments
portion of the meeting.
V. Baroldi moved the
approval of the Minutes of
the Public Utilities Board
Regular Meeting of
November 17, 2021. R.
Bhalla seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
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of key utility rate goals and strategies, including maintaining
affordable rates, how APU operates as a not -for -profit and has no
profit margin built into its rates, and how APU strives for lean
staffing and consistent capital investments to minimize service
disruption and costly repairs.
A. Nguyen provided an overview of APU's water rate components,
explaining how the Water System Reliability Adjustment (WSRA)
helps fund critical water utility capital investments. He described
how maintaining an aggressive pipe replacement program supports
service reliability and reduces the risk of having "an avalanche of
pipes needing immediate replacement all at one time."
Discussing forecasted water utility costs, A. Nguyen mentioned that
approximately 60% of total costs are for water supply, pumping,
and treatment. Although restoring groundwater reduces the
magnitude of cost increases in the near term, costs still trend
upward over the ten year horizon because of higher projected water
costs from Orange County Water District (OCWD) and
Metropolitan Water District of Southern California (MWD). He
noted that APU, in evaluating groundwater treatment solutions to
address per- and polyfluoroalkyl substances (PFAS) prioritized
customer safety above all other factors, sought cost recovery with
an important reimbursement agreement with OCWD, and focused
on a long-term, drought -proof supply knowing the drought's long-
term impact on water supplies.
Describing the Water Utility's current financial position, five years
from now, and ten years from now if no future rate increases were
implemented, A. Nguyen mentioned how quickly an operating
deficit can balloon upward and impair the Water Utility's ability to
perform critical capital improvements. Summarizing the proposal to
adjust water rates, he indicated that a typical residential customer
utilizing 16 hcf (hundred cubic feet) would see a 6% increase in
their monthly bill if the proposed rate adjustments were
implemented. He showed various bill comparisons against
neighboring water agencies indicating how competitive APU water
rates remain. APU staff commented on how some other water
agencies have a much noticeably higher customer charge than
APU's Water Utility, and the Board inquired why that was the case.
Brian Beelner, Assistant General Manager — Finance and Energy
Resources, explained that APU structures its rates in that manner so
customers who use less water can still save money on their bill.
A. Nguyen also described the Green Power Option, a proposed
voluntary program allowing residential or commercial customers to
purchase more renewable energy — above APU's state -mandated
target — to achieve their sustainability goals. The Board requested
that when the program is introduced, information be provided to
prospective participants regarding the mix of actual energy
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delivered to their premises, since prospective projects outside of
Anaheim would increase renewables and be metered appropriately
but would not deliver the actual energy directly to a participating
customer. APU staff agreed to include such information when it
becomes available.
A. Nguyen also discussed changing the peak period on three time -
based, electric rate schedules from 1 p.m. — 5 p.m. to 4 p.m. — 9
p.m. to better align with current power market conditions, and
shifting the summer period from June through September to July
through October. He emphasized that these specific proposals do
not change per unit rates, and that these time -based rate schedules
are completely optional for customers. He mentioned that APU is
proposing a one-year transition period for commercial customers
who may need time adjusting to the new peak period.
Other rule proposals A. Nguyen described include converting
development rate schedules into permanent ones, extending the
enrollment duration for participants in the Solar Power Program,
updating language in APU's rules to incorporate remote service
connections and disconnections to meters, and allowing solar
customers the option to roll over their energy credit to the next year.
A. Nguyen spoke about APU's customer outreach effort which
typically includes in -person events, website updates and
information, and bill inserts. He also described the rate hearing
process and timeline for the Board's reference.
The Board inquired about APU's pipeline replacement program,
and Craig Parker, Water Engineering Manager, replied by
describing how APU is working towards a goal of replacing seven
miles of pipe annually to coincide with the expected life of water
pipes. The Board commented about the importance of the goal to
provide reliable service.
The Board inquired whether basic information on the groundwater
treatment project would be available during the rate hearing for
proper context. Dukku Lee, Public Utilities General Manager,
replied that this was a good suggestion and that a brief primer on
PFAS and Anaheim's groundwater treatment project could be
shared during the rate hearing.
4. APPROVAL OF DESIGN -BUILD MASTER AGREEMENTS
FOR ELECTRIC PROJECTS BETWEEN THE CITY OF
ANAHEIM (CITY) AND ASPLUNDH CONSTRUCTION, LLC,
EE ELECTRIC, INC., HAMPTON TEDDER ELECTRIC CO.,
HOT LINE CONSTRUCTION, INC., PARKIA, INC.,
SOUTHERN CONTRACTING COMPANY, TRI-TECHNIC,
INC.; AND SUCH OTHER PREQUALIFIED DESIGN -BUILD
ENTITIES FOR A FIVE-YEAR TERM WITH AN
R. Gaona moved the
approval of the Design -
Build Master Agreements
for Electric Projects between
the City of Anaheim (City)
and Asplundh Construction,
LLC, EE Electric, Inc.,
Hampton Tedder Electric
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EXTENSION OF UP TO 12 MONTHS, APPROVAL OF A
NOT -TO -EXCEED AWARD AMOUNT OF $3,000,000 PER
WORK ORDER PACKAGE, PLUS CHANGE ORDER
AUTHORIZATION IN AN AMOUNT NOT -TO -EXCEED 10%
OF THE WORK ORDER PACKAGE PRICE; AND
DETERMINE THE ELECTRIC PROJECTS TO BE
PERFORMED UNDER THE AGREEMENTS ARE
CATEGORICALLY EXEMPT UNDER THE CALIFORNIA
ENVIRONMENTAL QUALITY ACT, SECTIONS 15301,
15302,15303, AND/OR 15304 OF TITLE 14 OF THE
CALIFORNIA CODE OF REGULATIONS. *
F. Barvarz, Transmission & Distribution Manager, presented on the
Electric Design -Build Master Agreements. F. Barvarz described
some of the typical capital improvements projects to improve
reliability and capacity of the electric infrastructure and visibility of
the public roadways to serve Anaheim's residents and businesses.
He explained that the proposed Electric Design -Build Master
Agreements are modeled after previously approved Water Design -
Build Master Agreements for water projects by the City Council in
November 2020. Project awards are limited to $3 million each and
pre -qualification followed an open proposal process with evaluation
based on factors including relevant experience, past performance,
financial standing, safety record, and technical qualifications. Seven
contractors are recommended for approval.
The Board inquired why emergency response is included in this
recommendation, and staff responded that having a contract in place
with prequalified firms will help during regional emergencies when
other utilities are in similar need and competing for limited
hr-R16111OW-10
The Board asked how many total respondents there were to the
request for proposals and F. Barvarz explained there were a total of
eight proposals, and one firm was unable to meet the City's terms
and conditions.
5. UPDATE ON ELECTRIC SYSTEMS.
F. Barvarz presented on electric updates, and D. Lee provided
additional context by showing several photos and briefly describing
the wind -driven Thanksgiving Day outages. He explained that a full
presentation will be provided to the Board next month. A set of
before and after photos were shown of the parking lot lighting for
Anaheim Hills Golf Course, as staff worked to provide shielding
from the glare brought up by a customer during the district
formation of an undergrounding project. F. Barvarz also described
the improvements as part of direct buried cable replacements within
the Royal Ridge Homeowners Association, showing the before and
after photos that included restoration of landscaping.
Co., Hot Line Construction,
Inc., Parkia, Inc., Southern
Contracting Company, Tri-
Technic, Inc. and such other
prequalified Design -Build
Entities. A. Abdulrahman
seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
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6. UPDATE ON WATER SYSTEMS.
C. Parker discussed the 2022 MWD Water is Life Calendar, where
APU had two entries that were selected and included in the month
of January 2022. This is an annual poster contest conducted by
MWD, where local school districts have students submit entries.
C. Parker also discussed the Water Supply dashboard. C. Parker
mentioned that the Orange County Groundwater Basin is in good
shape, as well as storage within the MWD system. The State Water
Project (SWP) reservoirs are very low at this point with a 0%
allocation — only health and safety water will be available for
members who receive only SWP water. The Colorado River (CR)
system is strained as well, with Lake Mead declining. Although
water supplies are strained, Anaheim is positioned well for the
drought given the investments that are being made to the
groundwater basin. The rainfall is about average this year in OC,
Northern California, and the Colorado River Basin. MWD has taken
several actions to increase conservation as a whole and conservation
on the CR.
C. Parker also mentioned that the drilling of two new wells at the
Santa Cruz site (near the 5 Freeway and Orangewood Ave). There
will be some large equipment on site beginning this month. C.
Parker also mentioned that Walnut Canyon Reservoir (WCR) in
Anaheim Hills will be filling with water this month in order to take
advantage of lower cost MWD untreated water due to a rate
increase that will take place in January. WCR will decline slowly
after that when the water is used.
7. UPDATE ON FINANCE & ENERGY RESOURCES ITEMS.
B. Beelner presented the Power Supply dashboard and made the
Board aware that the coal supply constraints at the Intermountain
Power Project (IPP) are now projected to last through June, 2022.
B. Beelner mentioned that these constraints are largely due to
supply chain problems caused by transportation shortages. These
issues mean that Anaheim's share of capacity from IPP has dropped
to 71 MW from the normal 236 MW. B. Beelner indicated to the
Board that APU is currently working on a mitigation strategy in the
event that this issue continues into the summer when the capacity
will be needed to handle summer demands, and will include these
mitigation strategies in APU's annual Summer Readiness
presentation.
B. Beelner discussed the monthly Finance dashboard with the
Board indicating that the year to date Electric revenue through
November, 2021 was 2.0% above budget ($3.8M). Electric costs for
the fiscal year to date fell below budget by 3.6% ($5.6M) causing a
net positive budget variance of $3.OM. B. Beelner then mentioned
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that year to date Water revenue was 3.1 % ($1.4M) below budget.
However, Water operating costs fell below budget by 8.0% ($2.9M)
causing a net positive budget variance of $1.5M.
B. Beelner then invited the Board to participate in a tour of the
Magnolia Power Project (Magnolia) in March, 2022.
8. UPDATE ON ADMINISTRATION & RISK SERVICES
ITEMS.
J. Sanks, Environmental Services and Safety Manager, described
the completion of the third quarter Internal Compliance Plan (ICP)
report. He explained that the report summarized key efforts to
ensure that APU remains in compliance with various laws and
regulations. He pointed out that the California Office of Emergency
Services had approved an Emergency Action Plan for the Walnut
Canyon Reservoir dam site, and thanked Water Services for their
help completing the plan.
J. Sanks then described APU's actions related to the State's
COVID-19 customer arrearages program. He reminded the Board
that surveys were completed in September, which identified
approximately $8M in customer arrearages that meet the program
specifications. He described that the actual amount to be received
would be less, since some customers have been able to pay their
bills reducing the outstanding amount, and that the State's electric
program did not have enough funding to cover all balances, so
utilities would receive an allocation of their outstanding customer
balances. He noted that earlier this month, APU filed an application
for water customer arrearages, and expected to receive
approximately $1 M in funding to assist customers with past due
amounts that meet the program requirements. He said a similar
application would be filed for electric customer arrearages later this
month. The State allotted APU approximately $4.5M for electric
customer arrearages and APU expects to receive the funding by
early January 2022.
The Board asked that the Administration and Risk Services
dashboard graphics be revised so the graph columns match between
the sections summarizing the total amount of past due payments and
the number of accounts.
J. Sanks then described APU's quarterly safety performance. He
explained that with the exception of COVID-related illness, the
safety metrics are similar to last year, APU continues to provide on-
going training to create a safer workplace, and APU employees
continue to perform their jobs in a safe and responsible manner.
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9. ITEM(S) BY SECRETARY.
D. Lee, Public Utilities General Manager, shared with the Board the
items scheduled for the following Board meeting that will be
coordinated with the City Clerk's office on the meeting format.
Proposed agenda items include:
• Water and Electric Rate Public Hearings and Electric &
Water Rule Modifications
• Recognition of Sustainable School Award Winners
• Thanksgiving Windstorm Outage Presentation
D. Lee mentioned the LED Holiday Light Exchange and Toy
Donation were extremely successful with over two hundred
customers that participated in the event.
M. Avelino -Walker, General Services Manager, explained the
Workability Program that is designed for students with disabilities
to gain workplace experience. These students assisted by
assembling kits and passing them out to customers.
D. Lee mentioned the High School Mentoring Program with two
Anaheim schools, Loara and Katella High Schools, in which the
students had the opportunity to interact with APU mentors,
participate in mock interviews, and create presentations. Final
presentations were given by the students at the conclusion of the 4-
session program.
D. Lee shared the outcome of the event on Cerritos and 9t' that
resulted from the Thanksgiving windstorm. Approximately 90
customers that were impacted by the storm interacted with staff.
This gave APU the opportunity to discuss resource efficiency
programs and thank them for their patience during the outages
caused by the windstorm.
D. Lee also mentioned that APU attended two Senior Fraud
workshops. Melissa Seifen, Communications Supervisor, explained
that this was a great opportunity to share fraudulent experiences and
educate seniors. This is one way to continue to remind customers to
watch out for fraud activities.
Lastly, D. Lee requested that the Board close the meeting in
memory of John Van New Kirk, Part -Time Field Services
Representative. Mr. Van New Kirk was remembered for being kind,
helpful to customers, and a great representative for Anaheim.
10. ITEM(S) BY BOARD MEMBERS.
M. Lee shared that the Water Rates Presentation was exceptional. He
also inquired about APU offering new customers Welcome Kits.
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Staff confirmed that the kits are still being sent to new customers in
batches.
R. Gaona wished everyone Happy Holidays.
R. Bhalla thanked staff for their work throughout the year to keep
rates low and provide quality service.
A. Abdulrahman mentioned the trash pickup situation and wished
staff Happy Holidays.
Vice -Chairperson V. Baroldi indicated he hopes that the trash pickup
situation is negotiated soon.
Chairperson J. Seymour asked for a moment of silence in
remembrance of John Van New Kirk.
11. ADJOURNMENT: (REGULAR MEETING ON DECEMBER
15, 2021 AT 5:00 P.M.)
Respectfully suPnitted,
Dukku Lee
Public Utilities General Manager
R. Gaona moved to adjourn
the Regular Meeting in
Memory of John Van New
Kirk at 6:54 p.m., to the
Board's Regular Meeting
date of January 26, 2022 at
5:00 p.m. N. Campos Kurtz
seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
* 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 City Clerk and City Council for informational purposes.
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