Utility Service Board Minutes
LEBANON UTILITY SERVICE BOARD
Lebanon, Indiana
April 9, 2008 Utility Conference Center 4:00 P.M.
|
Board |
Staff |
Present: |
Allen Milburn, Chairman |
Michael Adams |
|
Gary Ladd , Vice Chairman |
Michelle Hahn |
|
Tom Temple, Secretary |
Michael Martin |
Dan Lamar , Member |
Sandra Morgan |
|
James Urban, Member |
Randy Parsons |
|
|
|
Phil Rawlins |
|
Bob Waples |
|
Guests: |
Attorney Kirtley Melissa Garrard |
Doug Zitzelsberger
|
Lori Young Mark Smith |
|
1. Chairman Milburn called the regular meeting of the Lebanon Utility Service Board to order at 4:00 P.M. and confirmation of appropriate notification was acknowledged.
2. Chairman Milburn requested comments on the draft of the minutes dated March 19, 2008; Vice Chairman Ladd made a motion to approve the March 19, 2008 minutes as amended; Secretary Temple seconded; motion was approved.
3. General Manager Martin presented the Recoupment Agreement with the First Baptist Church and thanked Melissa Garrard and Ray Kirtley for the extra efforts in completing the agreement. Ms. Garrard explained this agreement is for future development by the Church involving a water line extension that they will construct and is a way to be able to recoup some of those construction costs that they will be incurring. She explained that Lebanon Utilities will receive 15% of the connection costs paid by connectors to compensate for its administrative fees. Attorney Kirtley stated he was satisfied and feels the agreement is appropriate and approves as to form. Chairman Milburn had a couple of comments or minor changes in the agreement and also questioned why it is stated City of Lebanon rather than Lebanon Utilities throughout the agreement. Mr. Kirtley stated he wanted this to conform to the statute. Member Urban made a motion to approve the Recoupment Agreement with First Baptist Church as amended and authorized Chairman Milburn to sign; Member Lamar seconded; motion was approved.
4. General Manager Martin recommended that he and any members of the Utility Service Board be able to attend the APPA National Conference that will be held in New Orleans, Louisiana from June 21, 2008 through June 25, 2008. He stated that some of the preconference seminar sessions that will be presented would be good for the Board members to attend as they address directly some of the needs of Board members. Secretary Temple made a motion to approve the General Manager and any of the Board members to attend the 2008 APPA National Conference; Vice Chairman Ladd seconded; motion was approved.
5. Mike Adams presented a recommendation for approval of a change order in the amount of $24,302 for the sheltered aisle switchgear and control house. Mr. Adams explained that after reviewing the construction drawings of the control house they found that we could eliminate some equipment for a credit of ($25,137) but we also needed some additional equipment ($49,439) which makes up the difference of the $24,302. Mr. Adams stated that with these changes Myers Controlled house remains the lowest bidder. Vice Chairman Ladd asked who prepared the plans. Mr. Adams stated that they just made a list of specifics rather than drawings and the General Contractor makes the plans. Mr. Adams stated he had talked to a SCADA representative and verified that the transducers were not needed. Vice Chairman Ladd made a motion to approve the change order for $24,302 to Myers Control and to authorize the General Manager to sign; Secretary Temple seconded; motion was approved.
6. Mike Adams presented a recommendation to purchase (8) 69kV Potential Transformers for the North Substation modification project and the 6901 and 6902 IMPA delivery point relay schemes from Brownstown Electric in the amount of $69,514.00 as well as (6) Current Transformer add on kits for the breaker 6906 from Wesco in the amount of $11,915.00. Mr. Adams explained the communication equipment applications and the essential reasons for this equipment. Vice Chairman Ladd asked about whether this should be quoted as one project or apportioned. Mr. Adams explained it was done this way to keep cost down. Chairman Milburn stated that he thought with larger projects being quoted normally some savings could be achieved but asked as to which direction is best. Mr. Adams stated he was trying to be frugal and that Brownstown and Wesco are standard vendors that have been used for quite some time. Vice Chairman Ladd stated that he just wanted to ensure we are in compliance with the bidding procedures. Vice Chairman Ladd made a motion to approve the purchase from Brownstown Electric in the amount of $69,514.00 for the Potential Transformers and to approve the purchase from Wesco in the amount of $11,915.00 for the Current Transformer add on kits and to authorize the General Manager to sign; Secretary Temple seconded; motion was approved.
7. Mike Adams presented an update on the BREMC territorial purchase. He said that he is currently working with REMC to transition some remaining areas of the city now served by REMC to Lebanon Utilities service. Some of these areas are Riley Road, Anderson Lane, Elmwood, John Bart Road and the 4-H Fairgrounds. He explained a joint petition between the Lebanon Utilities and REMC will presented to the IURC for approval as they are the regulatory body that has jurisdiction over electric service areas. Public notice would be given as part of the process. He stated that area on the south side of State Road 39 now owned by Dennison properties is also under future consideration for territorial exchange between the REMC and Lebanon Utilities. Mr. Adams stated that some of the Business Park is still in the REMC territory due to previous agreements made in conjunction with joint ownership of the Enterprise substation. Chairman Milburn stated that the Utilities and REMC have always had good cooperation and make good decisions for a smooth transition. Mr. Waples commented on some other areas that might be considered for annexation. The Board thanked Mr. Adams for his update.
8. Sandra Morgan conducted a Power Point presentation of the year end financials for 2007. The Board thanked Sandra for her presentation.
9. Member Urban had a question in regards to claim #93804 and was wondering when this fiber optic was ordered and why did we receive it from a local vendor. Mr. Parsons explained we needed a section of fiber to provide service to Witham Hospital and it was at that time it was purchased. Another portion was for completion of the fiber optic loop for eventual use by the Utilities but that too was in conjunction with the Witham project and purchased at that time.
Member Urban also questioned why this was charged to the Electric Department and not the Telecommunications Division. General Manager Martin explained that we have budgeted and charged all fiber optic in the past to the electric system as it is primarily for that Department’s telecommunications needs e.g. relay and protection, SCADA, communications among devices in the substations. In addition, all revenues for fiber optic service sales to third parties are now assigned to the Electric Department. The Electric department owns the fiber and receives the revenues for it and uses it for its own needs. He said that any BPL or Wireless equipment have been charged to the Telecommunications Division as has been budgeted and charged in the past and the Telecommunications Division has received those revenues.
Member Lamar made a motion to approve the claims dated March 31, 2008 in the amount of $224,315.80 and also claims dated April 9, 2008 in the amount of $311,291.78; Vice Chairman Ladd seconded; motion was approved.
10. Under any other business General Manager Martin provided an update on the analysis with Umbaugh which he said should be forthcoming and is hopeful the analysis will be completed next week. Mr. Martin said that he is also working on a marginal cost analysis with IMPA and should get those results in the near future. He is hoping to conduct separate meetings with the board members to explain what the results of the analysis show and that the studies that are being conducted now are looking at the marginal cost and marginal revenues. Umbaugh & Associates will be in the office sometime the week of April 14th.
11. Member Urban stressed that he has driven around town and seen fiber optics on the ground and also just hanging off the pole in large loops and wanted to know why this was. Mr. Parsons stated that the Electric Department was going around and picking some of them up but have been delayed and he has asked Phil Rawlins to try and clean up some of the extra fiber. Mr. Rawlins explained briefly why there is 150’ of fiber loop at certain locations. He said that is done for splicing and being able to maneuver it to the vehicle for the splicing to be conducted. Mr. Urban stressed that he wanted this to be cleaned up as soon as possible since some of the fiber was taken from the Camp street area by vandals thinking it was copper. Mr. Parsons stated he needed to work with the line crew to make sure that this was completed.
12. Member Urban also commented that it was his understanding that new installations were not to be performed from the report that they had received from Umbaugh & Associates. General Manager Martin explained that the new installations that were completed were with the equipment that we have in inventory and the marginal cost was just for the labor and use of the van in installation and that was $65 and if you look at the marginal revenue of $180 for installation, a positive contribution margin was being made even if the $50 per month service fee were not considered which it is. Mr. Urban stated that he understood Umbaugh to say that number was in the $1185 range. Mr. Martin said that the Umbaugh figure was he thought an average figure by taking the total cost of all telecommunications and dividing by the number of customers. That number includes BPL and all other costs. The proper figure to use he said is the marginal cost as that is the actual cost to install a wireless customer.
13. Chairman Milburn asked about the Kise Estate metering issue; General Manager Martin stated that we have found that customer equipment malfunctions have caused the excessive water use and that it was not a problem with our meters. He said that we are now reviewing this information with Kise Estates.
14. Chairman Milburn asked if any other details were made available for the Cantebury Apartment meter issue. General Manager explained that there was a multiplier differential between what is on the meter versus what is in our billing system that is being examined. Chairman Milburn explained he would like to have both of these items addressed at the next board meeting.
15. Chairman Milburn stated the next meeting would be on April 23, 2008.
16. Hearing no other business before the Board a motion was made to adjourn the meeting by Secretary Temple; Vice Chairman Ladd seconded; motion was approved. The meeting was adjourned at 5:40 P.M.
APPROVED THIS _____ DAY OF _____, 2008
____________________________
CHAIRMAN OF THE BOARD
ATTEST:
______________________
CLERK OF THE BOARD
Bmins04-09-2008
