Loading...
HomeMy WebLinkAboutAgenda Packet 03/11/2008 Utility Advisory Committee Public Works Conference Room Port Angeles, W A 98362 March 11, 2008 3:00 P.M. I. Call To Order II. Roll Call III. Approval Of Minutes For February 12, 2008 IV. Election Of Officers V. Late Items VI. Discussion Items A. Benefit Dump Day B. Compost Rate Ordinance C. Power Pole Replacement Contract Award D. Energy Conservation Program Annual Report E. Energy Champion Agreement F. Cost Of Service Study Agreement G. Standstill And Interim Relief Payment Agreement H. Interview Industrial -A-pplicant For UAC VII. Next Meeting Date: April 9, 2008 VIII. Adjournment N:\uac\final\031108 Utility Advisory Committee Public Works Conference Room Port Angeles, W A 98362 February 12, 2008 3:00 P.M. b~~ "'f,f:-,. .. I. Call To Order Chairman Reed called the meeting to order at 3:00 p.m. II. Roll Call Members Present: Chairman Reed, Mayor Rogers, Betsy Wharton, Orville Campbell, Dan Di Guilio Members Absent: None Staff Present: Mark Madsen, Bill Bloor, Glenn Cutler, Mike Puntenney, Steve' Sperr, Scott McLain, Terry Dahlquist, Kathryn Neal (3: 12), Jim Klarr (3:30), Cate Rinehart Others Present: None . '~ ,', '.' - ' III. Approval of Minutes: ~. / Chairman Reed asked ifthere were any corrections to the minutes of January 8,2008. ,1,',: Councilmember Rogers moved to approve the minutes. Orville Campbell seconded the motion, . ' . which carried unanimously with Councihnan Di Guilio abstaining. . i' . , .,: ' . I,. .',' IV. Late Items Western Electricity Coordinating CouncillNorth American ;"f, Electricity Reliability Corporation (WECCINERC) Update WP-07 Rate Case Update Design Phase 1 CSO Projects, Amendment No.3 To Agreement 06-01 V. Discussion Items: A. Interlocal Agreement With Clallam County PUD #1 Terry Dahlquist, Electrical Engineering Manager, advised that some overhead power lines need to be relocated due to construction ofthe Elwha Water Facilities on the Elwha River as part of the National Park Service Elwha Restoration Project. There was a brief discussion. Orville Campbell moved to recommend City Council authorize the City Manager to approve an interlocal agreement with the pun regarding facility ownership on the Elwha River. Councilmember Wharton seconded the motion, which carried unanimously. UTILITY ADVISORY COMMITTEE February 12,2008 B. Move April UAC Meeting Date Due to meeting conflicts the Tuesday, April 8th meeting date was changed to Wednesday, April 9th. C. Western Electricity Coordinating CouncillNorth American Electricity Reliability Corporation (WECC/NERC) Update Scott McLain, Deputy Director of Power Systems, explained that the Energy Policy Act of2005 mandated increased reliability and accountability for users and operators of the bulk power system. After being submitted for registration by BP A, the City submitted a formal "dispute of registration requirement" to NERC. The City had a hearing on January 8,2008 with WECC compliance staff and subsequently the City is being removed from the WECC and NERC registered entities lists. There was a brief discussion. Information only. No action taken. D. WP-07 Rate Case Update Scott McLain, Deputy Director of Power Systems, announced that BP A had recently released its initial proposal for reopening the 2007 Rate Case. In a related matter, BP A will offer interim agreements that would return some of the overcollected revenues. A discussion followed. Information only. No action taken. E. Design Phase 1 CSO Projects, Amendment No.3 To Agreement 06-01 Steve Sperr, City Engineer, noted that since the detail design had begun several unanticipated elements of work critical to the design effort had been identified which include use of existing Rayonier pipelines and environmental documentation. There was a brief discussion. Councilmember Rogers moved to recommend City Council authorize the Mayor to sign Amendment No.3 to the Agreement with Brown and Caldwell for the detailed design of Phase 1 CSO Projects, increasing the maximum compensation amount under the agreement by $102,700, from $1,745,000 to $1,847,700. Councilmember Wharton seconded the motion, which carried unanimously. F. Statewide PUD Mutual Aid Agreement Jim Klarr, Light Operations Manager, explained that Washington public utilities (municipal and PUDs) have traditionally worked closely on many matters including mutual assistance for storm response and recovery. The mutual aid plan and agreement allows the City to both provide and UTILITY ADVISORY COMMITTEE February 12,2008 receive support from the other signatory utilities in an efficient and timely manner in the event of a disaster. A discussion followed. Orville Campbell moved to recommend to City Council that the City of Port Angeles Electric Utility become a signatory to the Washington Public Utility District Mutual Aid Plan. Councilmember Rogers seconded the motion, which carried unanimously. VI. Next Meeting Date: March 11, 2008 VII. A djornment: The meeting was adjourned at 3:58 p.m. Chairman Reed Cate Rinehart, Admin Spec II N :\PWKS\LIGHT\CONS\CA TE\feb 12meet. wpd ....'(~":!:Ii!!>;.. ", ~1"f'. '~{1;. .' - >, ./$":>' "'iJ F: JOr 'R' 9T"');. N' 'Gr IE: ,IL" H; ,IS' , 'J " I V I I' .,,' " : . >~. ~- j I I 'J i! ~ ~/ i Y , " ",' I,d' '.,' ,",. . . t," - CITY OF WAS H I N G TON, U. S. A. Utility Advisory Committee Memo Date: March 11, 2008 To: Utility Advisory Committee From: Tom McCabe, Solid Waste Superintendent Subject: Benefit Dump Day Summary: The City of Port Angeles sponsors an annual Benefit Dump Day for all Clallam County residents. The scheduled date this year is Sunday, April 20th from 9:00 am to 3:00 pm. Staff recommends increasing the suggested minimum donation from $5.00 to $10.00 a vehicle. Recommendation: Information Only Background/Analysis: The Solid Waste Division sponsors an annual Benefit Dump Day for all Clallam County residents. At past events, a minimum $5 donation was collected from each vehicle by the Port Angeles Food Bank. Dumping is restricted to one load per household with vehicle sizes up to a 3/4-ton pick-up truck or a trailer measuring 5 ft x 8 ft and a maximum limit of four tires and four appliances per customer. Commercial haulers are not allowed. Large appliances, metals, and tires are collected for recycling. Promotion / Advertisine: Peninsula Daily News Sequim Gazette KONP Radio Staff for the Event Waste Connections (Transfer Station) City Staff (metal pile, scales, gate) Clallam County Staff (for oil and antifreeze) Food Bank Staff and Volunteers (gate) Police Patrol Volunteers (traffic control) The 2008 Benefit Dump Day will be Sunday, April 20. Mikki Saunders, Director of the Port Angeles Food Bank has asked the City to consider increasing the minimum suggested donation to $10.00 per vehicle. City staff supports her requests for the increase. The hours and load restrictions will be the same as previous years. The tipping fees and labor cost is built into the current tipping fees. SUMMARY STATISTICS FOR PAST EVENTS Event Totals Year Vehicle Solid Cash Food (lbs) Trips Waste Contribution Contribution Tons 2003 1,400 581 $3,259 5,840 2004 706 251 $1,960 2,440 2005 841 300 $1,998 Not available 2005 677 234 $3,664 Not collected 2007 713 223 $4,304 Not collected Demographic of Users and Fees Not Collected 2007 2007 Tip Fees Not Location Vehicles Tonnage Collected City of P.A. 286 83.98 $8,146.06 Sequim 20 6.49 $629.53 Forks 1 .74 $71.78 East County 248 82.76 $8,027.72 West $4,745.24 County 158 48.92 Totals 713 222.89 $21,620.33 Transfer S tation Total: 141.48 tons Recycling Total: 81.42 tons (tires / metal pile / oil / batteries) Refrigerator/Freezer Environmental Fees Waived: 84 units ($1,680) ~.r yO,R:)Ti'P1:/..N.'.: rG'" I.E,'Li' E~'S" i-J .' ....'.V ',)' J 'wi')' j I , I / , I . . , ' . WAS H I N G TON, U. S. A. Utility Advisory Committee Memo Date: March 11, 2008 To: Utility Advisory Committee From: Tom McCabe, Solid Waste Superintendent Subject: Revised Compost Sales Ordinance Summary: The current rate structure for compost sales is $20.00 per cubic yard for up to three yards and $17.00 per yard for four yards or more. City staff is proposing a more flexible rate structure to attract new sales by allowing greater discounts for schools, non-profits, government agencies, and customers purchasing large quantities. Recommendation: Forward a favorable recommendation to City Council to modify the existing ordinance to include the new rate structure outlined below. Background/Analysis: The City started selling Class A Compost in April 2007. The city has sold 857 cubic yards of compost to date. The compost facility is projected to make 4,000 to 6,000 cubic yards in 2008. Additionally, since the City began selling compost, it has received numerous inquiries from private businesses and non-profits to provide greater incentives for large quantity sales. In an effort to increase the amount of compost sold, staff is proposing a new rate structure. It is expected that the full cost of compost production will be recovered with the following rate structure. Categories Cubic Yards Cost Per Cubic Yard Percent of Discount Any Customer 1-3 $20 None Any Customer 4-49 $17 15% Schools 4-99 $15 25% Non- Profits 4-99 $15 25% Governments 4-99 $15 25% Any Customer 50-99 $15 25% Any Customer 100-299 $14 30% Any Customer 300+ $13 35% Attachment: Revised ordinance ORDINANCE NO. AN ORDINANCE of the City of Port Angeles, Washington, amending Chapter 13.57 of the Port Angeles Municipal Code to allow a more flexible rate structure. THE CITY COUNCIL OF THE CITY OF PORT ANGELES DO HEREBY ORDAIN as follows: Section 1. Ordinance 3300, in part, and Subpart F of Section 3.57.020 PAMC are hereby amended to read as follows: F. The sales price per purchase for Class A Compost at the transfer station shall be~ $20.00 pel cubic yard for up to J yards arId $17.00 pcr yard for Illorc than J yards, plus \Vashington Statc sales tax. After May J 1 of each ycar, Cate2:orv Anv Customer Anv Customer Anv Customer Anv Customer Anv Customer Schools, Non-profit or Government Agencies Quantity Cubic Yards 1 .. 3 4-49 50-99 100-299 300 or more Price Per Cubic Yard $20.00 $17.00 $15.00 $14.00 $13.00 4 or more $15.00 Washington State sales tax will be added to the prices listed above. tlhe Director shall have authority to establish a different sales price for Class A Compost in response to then existing operating conditions; provided that such price recovers the cost of providing the compost; the price provides a benefit to the City not otherwise obtained; the City Manager, Mayor and Council members of the Utility Advisory Committee are notified; and that the different price expires ninety (90) days after adoption by the Director, unless it is formally ratified by the City Council, in which event the price shall remain in effect to the end of the calendar year. -1- Section 2 - Corrections. The City Clerk and the codifiers of this ordinance are authorized to make necessary corrections to this ordinance including, but not limited to, the correction of the scrivener' s/clerical errors, references, ordinance numbering, section/subsection numbers and any references thereto. Section 3 - Severabilitv. If any provisions of this Ordinance, or its application to any person or circumstances, are held invalid, the remainder of the Ordinance, or application ofthe provisions of the Ordinance to other persons or circumstances, is not affected. Section 4 - Effective Date. This ordinance, being an exercise of a power specifically delegated to the City legislative body, is not subject to referendum. This ordinance shall take effect five days after its publication by summary. PASSED by the City Council of the City of Port Angeles at a regular meeting of said day of , 2008. Council held on the Gary Braun, Mayor ATTEST: Becky J. Upton, City Clerk APPROVED AS TO FORM: William E. Bloor, City Attorney PUBLISHED: .2007 By Summary G:\Legal_Backup\ORDINANCES&RESOLUTIONS\ORDINANCES.2008\07 - Compost Sales Rates.03-04-08. wpd March 5. 2008 -2- Date: To: From: Subject: no.~ iR;T" A IN' i'G' I,EriL: E:"SI.. 1~ ...~... .In: _I.'..!" !.. WAS H I N G TON, U. S. A. Utility Advisory Committee Memo March 11, 2008 Utility Advisory Committee Michael Puntenney, Deputy Director Public Works and Utilities Award Power Pole Replacement Contract, Project No. WF-65680 Summary: The Electric Utility has numerous deteriorated power poles that are in critical need of replacement. Bids were requested to replace multiple power poles and transfer the existing conductors at various locations within the City. Four bids were received and opened on February 26,2008. Michels Power Division of Michels Corporation, Tacoma, W A submitted the lowest responsible bid in the amount of $63,956.00, including tax. Recommendation: Forward a favorable recommendation to City Council to 1) transfer funds in the amount of $70,000 from the 401-7180-533-4150 account to the 401-7111-533- 4810 account, and 2) award and authorize the Mayor to sign a contract for the Power Pole Replacement Contract, Project No. WF-65680, with Michels Corporation, Tacoma, W A. Background/Analysis: The Electric Utility has numerous deteriorated power poles that are in critical need of replacement. With the City's higher amount of development over the past two years that necessitated the installation of transformers and other electrical infrastructure for sub- divisions, some planned maintenance work was required to be delayed. In order to catch up on some of this essential maintenance, the Electric Utility determined that contracting out the most urgently needed pole replacements was warranted. The contract will include replacing existing wood poles, crossarms, and other hardware and transferring the existing conductors at various locations on the City of Port Angeles (COP A) power distribution system. In order to maintain the integrity of the power system for the City, it is imperative that these deteriorated poles be replaced now. The materials for this work will be supplied to the contractor from the Electric Utility's inventory and paid from the materials-job cost account, 401-7180-533-3402. Bids were requested, and four bids were received and opened on February 26,2008. Michels Power Division of Michels Corporation, Tacoma, W A submitted the lowest responsible bid in the amount of $63,956.00, including tax. Including contingencies for any unforeseen conditions identified after construction commences, $70,000 is required. N:\UAC\Final\Pole replacement contract.doc Power Pole Replacement Contract UAC Memo March 11, 2008 Page 2 The original government estimate for this work was $45,000. However, all four ofthe bids received for this contract were within a competitive range between $64,000 to $75,250. City staff believes that this is the fair market price, particularly due to the difficulty of the terrain for the replacement of some of the poles. The bid results are summarized below: Contractor City Bid (Including Tax) Michels Corporation Tacoma, WA $63,956.00 Moza Constructin Tacoma, WA $75,249.11 Olympic Electric Port Angeles, W A $99,672.72 Potelco, Inc. Sumner, W A $70,806.88 Engineer's Estimate $45,000.00 The Finance Committee met on March 4, 2008 and forwarded a favorable recommendation to both the Utility Advisory Committee and City Council to: 1) transfer funds in the amount of $70,000 for pole inspection services: from: 401-7111-533-4150, Professional Services Account to: 401-7180-533-4810, Repair & Maintenance Account 2) award and authorize the Mayor to sign a contract for the Power Pole Replacement Contract, Project No. WF-65680, with Michels Corporation, Tacoma, WA. M 8t and 5th M 8t and Westview APPENDIX A POWER POLE REPLACEMENTS WF-65680 GENERAL WORK REQUIREMENTS The following list provides a general summary of work requirements expected to be performed by the contractor. Detailed work requirements are provided in the previous specifications and in the referenced construction standards and work sketches (staking sheets) that follow: WORK LOCATION SUMMARY OF WORK SKETCH # 9847 A A St & 7/8 Alley Replace (1) 40/3 Pole Modify framing on 2 adjacent poles 10249 4207 Fairmount Replace (1) 30/3 Pole 10286 10th & H Streets Replace (1) 30/3 Pole 10292 224 N. Washington Replace (1) 30/3 Pole with 40/3 Modify framing on 2 adjacent poles 10308 6/7 Alley East of Cherry St Replace (1) 40/3 & (1) 30/3 Pole 10318 1101 E. Front St. Install (1) New 30/3 Pole 10322 Chinook Motel Replace (1) 30/3 Pole 10331 1210 E. 2nd St. Replace (1) 40/3 Pole 10333 M St & 8/Westview Alley Replace (1) 40/3 Pole Modify framing on 1 adjacent pole 10348 4/5 Alley West of M St Replace (2) 40/3 Poles 10352 214 Whidby Ave. Replace (1) 40/3 Pole Date: To: From: Subject: Fl.' lOr iR,IT' ::N' v..N:. !G/ ',E.../L' E:iS' 'i \".,v'. . ,'. r,. : ~) ,m..U ' ! 'i .j , ~ I 1 -. ., ., WAS H I N G TON, U. S. A. Utility Advisory Committee Memo March 11, 2008 Utility Advisory Committee Larry Dunbar, Power Resources Manager Conservation Rate Credit Program Status Report Summary: We are at the halfway point in the Bonneville Power Administration's new Conservation Rate Credit program. Staff will present the achievements made to date, summarize the available rebates, and share the progress made since last June on various options to utilize available program funding. Recommendation: For information only, no action requested. Background/Analysis: The Bonneville Power Administration's Conservation Rate Credit (CRC) Program has been in operation since October 1, 2006 and offers electric utility customers rebates for energy efficient building improvements, appliances and lighting. The CRC concludes September 30,2009. Staffwill present the progress made on various options to utilize available funding that were discussed with the Utility Advisory Committee last June. Below is a summary of the program achievements from October 1,2006 through February 29, 2008. Please see the reverse side for a summary of currently available rebates. Improvements HVAC Window Water Heating Dishwasher Clothes Washer Refrigerator Showerheads Lighting Insulation Air Sealing Low Income WX Renewables New Construction Totals # Jobs/Units 2 8 60 1 114 20 2,158 57 6 21 12 1 6 2,466 N:\UAC\Final\Conservation program status report.doc Total Cost $43,874 47,384 11 ,772 453 170,561 28,485 13,928 57,206 13,959 10,728 9,573 10,947 2,975,000 $3,393,870 City Rebate KWh Savings $10,171 76,297 694 2,222 1,072 4,565 25 101 5,700 36,252 500 1,658 16,773 508,775 46,096 839,519 4,780 16,195 10,728 7,827 9,572 4,469 720 1,440 5,000 15,124 $111,831 1,514,444 CRC $10,171 667 1,124 25 8,920 500 26,140 68,099 4,860 2,408 9,572 720 6,260 $139,466 Conservation Rate Credit Program Status Report March 11, 2008 Page 2 Summary of Currently Available Rebates Available Single-Family Manufactured Multi-Family Small Improvements Homes Homes Homes 1 Commercial 2 $470 j N/A N/A N/A Heat pump $915 'I $280 :J N/A N/A Windows () $0.50/SF $0.50/SF $0.50/SF N/A Warranty Rebate N/A Electric water heater 7 10- year $25.00 20-year $50.00 Dishwasher I, IS, '} $25.00 $25.00 $25.00 N/A Clothes washer I, IS $50.00 $50.00 $50.00 $150.00 Refrigerator IS $25.00 $25.00 $25.00 Up to $200 $2.50 each $2.50 each $2.50 each $3.00 each Compact (>5 watt) (>5 watt) (>5 watt) (>5 to 45 watt) fluorescent lamps 8 $12.00 each (>45 watt) Lighting fixture 8 $2.50/socket $2.50/socket $2.50/socket $15.00 -$165.00 per fixture 10 Wall insulation Up to $0.60/SF N/A' Up to $0.60/SF Up to $0.25/SF Attic insulation Up to $0.70/SF Up to $0.49/SF Up to $0.80/SF Up to $0.45/SF Floor insulation Up to $0.75/SF Up to $0.75/SF Up to $0.75/SF Up to $0.45/SF Air-sealing l i $0.08/SF N/A N/A N/A Solar water heater 7 $500/31 SF $500/31 SF $500/31 SF $500/31 SF collector area collector area collector area collector area Photovoltaic $500/kW $500/kW $500/kW $500/kW $1,000 $500 $40 $0.50/SF floor New Construction NW ENERGY NW ENERGY approved area 12 STAR@ STAR@ thermal shell Energy Smart improvements Office Design l Low-nse multI-famIly homes only. 2 Must be an office or retail space 5,000 square feet (SF) or less. 3 Heat Pump Heating Season Performance Factor at least 8.5 without duct sealing. 4 Heat Pump Heating Season Performance Factor at least 8.5 with duct sealing. S Duct sealing alone. 6 National Fenestration Rating Council tested U-value not to exceed 0.30. 7 Existing unit must be an electric water heater. 8 Must be ENERGY STAR@ labeled. 9 New dishwasher must have a minimum energy factor of 0.76. 10 Must reduce existing lighting energy use by a minimum of30%, other restrictions apply. 11 Air-sealing rebate is based on actual tested leakage reduction. 12 Must be new office building 100,000 SF or less. n:Qr 'R: 'T!" A IN, :G'/ iE,iL: E: "S', '1=-/' . '.ft., ,) ..: · .J ': ~9 WAS H I N G TON, U. S. A. Utility Advisory Committee Memo Date: March 11, 2008 To: Utility Advisory Committee From: Larry Dunbar, Power Resources Manager Subject: Energy Champion Cooperative Agreement Summary: The Bonneville Power Administration offered the City a Cooperative Agreement to equally share the cost of an energy champion engineer with Nippon Paper Industries USA. A separate Participation Agreement is needed to deliver the benefits of the Cooperative Agreement from the City to Nippon. Recommendation: Forward a favorable recommendation to City Council to authorize the Public Works and Utilities Director to sign 1) Cooperative Agreement No. 36911 with the Bonneville Power Administration, and 2) a Participation Agreement with Nippon. Background/Analysis: Last year the Bonneville Power Administration (BPA), Industrial Efficiency Alliance (IEA) and City staff met with Nippon Paper Industries USA (Nippon) to discuss strategic energy management opportunities. As a result of that discussion one of the main suggestions was to consider an "energy champion engineer". The energy champion engineer (ECE) would promote continuous energy improvements, develop and implement an energy management program, and identify and prioritize energy conservation projects. The ECE would be an experienced engineer and be selected by Nippon with the assistance of the IEA. BP A is being responsive to Nippon's needs and has expressed willingness to equally share the first year's cost ofan ECE not to exceed $100,000. In addition to funding an ECE, additional BPA funding is available through September 30, 2009 for up to 70% of the cost of electrical energy conservation projects. BP A offered the City a Cooperative Agreement to support the ECE. A separate Participation Agreement between the City and Nippon is also needed. Due to the long lead-time needed to develop and implement industrial energy conservation projects and the conclusion ofBPA's current programs in 2009, all parties are striving to have the agreements accepted this month. The Bonneville Power Administration reimburses all City expenses under the proposed agreements. N:\UAC\Original\Energy champion engineer. doc Date: To: From: Subject: F' -Or-R' .IT' <'J1J.- - N' :G/-' 'E' it: E"SI _i_' i i J ;~ :; f!:: ,: ;.j .._.r; ,..... '.. .'..; ._..-:,"-.1 .'fl..; .';/ : r I I ....., .., - , WAS H I N G TON, U. S. A. Utility Advisory Committee Memo March 11, 2008 Utility Advisory Committee Larry Dunbar, Power Resources Manager Consultant Agreement for Utility Cost of Service Studies Summary: Every three years a consultant completes a study to assess and evaluate the cost of City utility services and rates. Studies are to be completed this year for the water, wastewater, solid waste collection, and solid waste transfer station utilities. Recommendation: Forward a favorable recommendation to Council to approve and authorize the Mayor to sign an agreement with FCS Group for imancial services in an amount not to exceed $67,112, which includes tasks 1- 3, 5 & 7 of the proposed scope of work. Background! Analysis: Every three years we have traditionally used a consultant to independently assess and evaluate the cost of City utility services, cash reserve needs, and rate structures. The water, wastewater, solid waste collection, and solid waste transfer station utilities are due to be studied this year and the electric utility next year. The results of this year's studies are anticipated to be available in August. As part ofthe consultant selection process, last fall staff advertised a formal request for proposals for utility rate studies. A total of fourteen consultant inquiries were received and three consultants submitted proposals including EES Consulting, FCS Group, and MuniFinancial. The City's prior utility financial consultant, HDR/EES chose not to submit a proposal because of an anticipated conflict of interest. Staff determined that FCS Group submitted the most responsive proposal and negotiated a scope of work and budget for the project. Table 1 outlines the key tasks in the proposed consultant agreement, with task amounts and what was budgeted in 2008 for each task. Funding sources are from the approved water, wastewater, solid waste collection, and solid waste transfer station utility budgets. The optional scope of work, which was defined after the 2008 budget was approved, is separately listed. Funding is available within the 2008 professional/contract services utility budgets to support the optional scope of work. The duration of the new agreement would be through January 31, 2010, which may encompass a similar study for the electric utility next year. Staff recommends that the UAC forwards a favorable recommendation to City Council to approve and authorize the Mayor to sign an agreement with FCS Group in an amount not to exceed $67,112, which includes tasks 1-3, and optional tasks 5 & 7 of the proposed scope of work. N:\UAC\Original\Cost of service study agreement doc Consultant Agreement for Utility Cost of Service Studies March 11, 2008 Page 2 Table 1- Summary of 2008 Scope and Budget Sub-Total FCS Group 2008 City . Task Fee Budget $15,664 $30,000 21,394 15,000 21,034 15,000 $58,092 $60,000 TASKS 1. Solid waste collection & transfer station utility COSA 2. Water utility COSA 3. Wastewater utility COSA RECOMMENDED OPTIONAL TASKS FCS Group Task Fee 2008 City Budget 5. Water & wastewater connection fee update 7. State tax review (water, wastewater, solid waste) 4,200 4,820 Total $67,112 $60,000 FCS Group OPTIONAL TASKS NOT RECOMMENDED Task Fee 2008 City Budget 4. Water & wastewater system development charge update 6. Review Title 13 - Public Utilities rate ordinance $10,265 4,820 Staff recommends tasks 1-3 and optional tasks 5 & 7 are included in the approved scope of work. '\ Date: To: From: Subject: Fi '0. R' iT' ''PJ.' , N' 'G/ fE'L' E; is.. ! I. . l I .. I JI ; I ,_ j' .: j . ."p ~f 1 l r; 1: (,,',', ~ 'I : i I .' - H' 'n ,~ WAS H I N G TON, U. S. A. Utility Advisory Committee Memo March 11, 2008 Utility Advisory Committee Scott McLain, Deputy Director for Power Systems Standstill and Interim Relief Payment Agreement Summary: Due to a successful court challenge on a Bonneville Power Administration (BP A) rate setting issue, the City will be due a substantial wholesale power cost rebate at the completion of a supplementary BP A rate proceeding. That rate proceeding should be concluded in September 2008. This Standstill and Interim Relief Payment Agreement will return a portion of the money prior to the final conclusion of the rate case. Recommendation: Forward a favorable recommendation to City Council to authorize the City Manager to sign the Standstill and Interim Relief Payment Agreement with the Bonneville Power Administration. Background/Analysis: In May of2007, the Ninth Circuit Court of Appeals ruled that the Bonneville Power Administration had illegally entered into an agreement with the Investor Owned Utilities (IOU's) setting the amount of their residential exchange benefits. The court remanded to Bonneville the process of correctly setting residential exchange benefits for the IOU's in a manner that followed the laws set forth under the Northwest Power Act (P.L. 96- 501). BPA has started this process with the opening a supplemental rate case scheduled to be completed in September of2008. After the court made its decision, BP A discontinued all residential exchange benefit payments to the IOU's. This agreement, along with a similar agreement with the IOU's, would reinstate payments to the IOU's at a reduced level, and provide payments to public utilities for amounts the public utilities had paid through previous wholesale rate charges. The final amount of the payment to the City will not be known until the completion of the Bonneville rate case. The payment amounts contained in the agreement are based on the initial proposal by BP A in the rate case. The initial payment amount (the amount the City would receive now), is about two thirds of the total based on BP A's initial proposal. N :\U AC\Final\Interim payment agreement doc Standstill and Interim Relief Payment Agreement UAC Memo March 11, 2008 Page 2 The possible downside to signing the agreement includes the possibility that the final outcome of the rate case will provide a rebate that is smaller than the amount that the City would receive by signing this agreement, and the City would have to return some money to BP A. Staff believes this has a small probability. Another possibility is that if many of the Public Utilities sign the agreement, it would send a message to BP A that would vindicate their approach and make it more challenging to get a final resolution of the rate case at a lower number. If the Council decides to sign the agreement, staff would attach a cover letter to the agreement outlining our stance that this is not an acceptance of the proposed terms of the rate case, but only taking advantage of the opportunity to get some of our customer's money back sooner. Staff recommends that the UAC send a favorable recommendation to City Council to authorize the City Manager to sign the Standstill and Interim Relief Payment Agreement with the Bonneville Power Administration.