TENTATIVE REGULAR MEETING AGENDA

GLASGOW ELECTRIC PLANT BOARD

JUNE 25, 2019, 6:00 PM

1. CONDUCT ELECTION OF OFFICERS

2. APPROVAL OF AGENDA AND ANY ADDITIONS

3. CONSIDER REPLACEMENT OF ROBERT’S RULES

4. REVIEW AND APPROVE MINUTES OF MAY 28, 2019 MEETING

5. CONSIDER BI-ANNUAL WRITE-OFFS

6. CONSIDER PARK MOVIE SCREEN MATTER

7. CONSIDER QUITCLAIM DEED FOR EASEMENT

8. CONSIDER 2019 BUDGET ADJUSTMENT and 2020 BUDGET

9. SUPERINTENDENT’S REPORT

A. MAY METRICS AND FINANCIAL METRICS REVIEW

B. JULY FCA

C. CPD LEDGER

D. AG RULING ON GDT COMPLAINT - TRAINING

E. WINDSTREAM BANKRUPTCY

F. TVA DISCUSSION ON GREEN POWER PROGRAM ISSUE

G. LARGE OUTAGE REPORT

10. ADJOURN

MEMORANDUM

TO: Members of Glasgow Electric Plant Board

FROM: William J. Ray, PE

DATE: 6/21/2019

SUBJECT: Board Meeting Information

June Main Topics

Ø Reorganize Board and Elect New Officers

Ø Discuss Replacement of Robert’s Rules of Order as EPB Meeting Guide

Ø Bi-Annual Write Offs Report

Ø Park Movie Screen Question

Ø Consider Quitclaim Deed for Roger Payne

Ø Amend 2019 Budget and Approve 2020 Budget

Ø Reports

📷July 1 FCA

Ø The July 2019 TVA FCA will increase to 1.854 cents per kWh. This is the second monthly increase to the FCA in the last two months. TVA’s explanation is that an unusually hot May put unexpected pressure on sales and, in turn, fuel costs.

Ø On July 1, the energy component of our retail rates will adjust to reflect this anticipated increase to the wholesale cost of energy.

Action Items

Election of Board Officers

Ø The resignation of D.T. Froedge, with his ultimate status unknown, according to newspaper reports (there has been no formal notice from City of Glasgow provided to EPB), leaves us looking for stability through new officers. Board members should conduct a new election of officers at this meeting, to establish clear authority as to who will chair the upcoming meetings.

Approval of Agenda and any New Items Desired by Board

Ø As the meeting will open with the adoption of Robert’s Rules of Order still in place, this agenda approval item will need to follow the election of officers. The present proposed agenda is attached to this narrative, but, as always, any board member can ask for additional items to be added.

Robert’s Rules of Order or an Alternative Set of EPB Rules of Order

Ø As we’ve all seen, proper compliance with Robert’s Rules of Order, as adopted by the Board earlier this year, is quite difficult due to the volume of rules contained therein, and the general lack of expertise on the many facets to Robert’s Rules.

Ø Since Glasgow EPB has operated quite effectively for over 50 years using simple parliamentary procedures to govern its meetings, the Board may want to consider adopting a written version of basic parliamentary procedure, perhaps customized to meet the specific desires of the Board, such that a return to less burdensome meeting procedures can occur.

Ø A copy of a simple outline of basic parliamentary procedure is attached for the Board’s consideration. At the meeting this document can be discussed and desired alterations can be directed to the Superintendent, such that a final document can be approved at a later meeting, formally recording in the minutes what meeting rules are in place for Glasgow EPB.

Review and Approve Minutes of May 28, 2019 Meeting

Ø This is the customary review and consideration of formally adopting the proposed minutes for the last meeting.

Bi-Annual Write-offs

Ø Many years ago, Glasgow EPB adopted the policy of officially considering account balances which have not been paid, for official write-off on a bi-annual schedule. This is normally done in June and December.

Ø Though the board has adopted a matrix of procedures, deposit policies, and technology to mitigate bad debt, the battle is not won. We still struggle to keep the monthly cost caused by those who take our services, yet do not pay for them, below $10,000. This month’s list of half a year’s worth of those bad debts will echo that monthly goal.

Ø Bad debt is a significant part of our fixed costs, which our new rates attempt to recover through the customer charge. Since keeping the customer charge low is a constant goal of the EPB team, keeping bad debt low is directly related.

Ø We are certain that no EPB customer who pays their account fully, and on time each month, wants to be burdened with also paying a portion of the costs associated with these customers who do not pay, but each month a portion of their customer charge is earmarked for that purpose. That is a shame, but as a non-profit municipal corporation, Glasgow EPB has no other way to cover the cost of bad debt.

Ø At the meeting, in conjunction with the discussion of the list of accounts we propose to be written off, we will discuss EPB policies relative to protecting the majority of customers from being tasked with paying for an increasing level of bad debt from a minority of customers. Since these policies are sometimes criticized, it will be useful for the Board to consider any new directions it thinks best for the EPB team to administer relative to the pursuit of bad debt reduction.

EPB Participation in Installation of Movie Screen at Beaver Creek Park

Ø City of Glasgow Parks and Recreation is partnering with Kiwanis Club and YMCA, in providing free outdoor movies in the park. The first of these was scheduled for June 14. They are making plans for the event to become quite large and, if that happens, some provisions for a larger movie screen must be planned.

Ø We have been approached by the sponsors and asked if we might participate in the provision and installation of a couple of wood poles which might be used to support the planned screen. While no official plans have yet been developed, the cost of us providing two 35-foot wood poles and installing them might cost us $1500 to $2500.

Ø At the meeting I would like to discuss this with the Board so I can get directions on this proposed project.

Consideration of Quitclaim Deed Request from Roger Payne

Ø This matter has been discussed off and on for several years. Roger Payne developed the Garnett Grove Subdivision, just south of Glasgow on US 31E.

Ø Glasgow EPB acquired a 69kV transmission line and a 100-foot-wide easement containing the transmission line, in the 1970s. The transmission line and easement were in place when the subdivision was developed, and several of the lots are affected by the restrictions associated with the transmission line and the easement.

Ø A few years ago, when East Glasgow Primary was built, along with a new TVA 161kV transmission line tap to serve it, the old 69kV line became redundant. We maintained the skeleton of the line and the easement to preserve our right to build a fiber optic circuit along that route in case it was needed in the future.

Ø As our internet access has evolved over the years, we see no clear need to further maintain that route.

Ø Roger Payne would like us to relinquish the easement through the execution of a quitclaim deed (a copy of which is attached), which he had prepared.

Ø At the meeting I will recommend that you honor his request and allow me to execute same.

Budget Adjustment and 2020 Budget Approval

Ø Kentucky law requires that non-profits and municipal corporations, like Glasgow EPB, end each fiscal year with a balanced budget, and begin each fiscal year with a board-approved budget for the year.

Ø The Board will need to consider the staff recommendation to alter the FY 2019 budget to reflect actual revenues and expenditures for the fiscal year about to end.

Ø The Board will also need to consider and adopt a new budget for FY 2020. Since it is impossible to accurately predict revenue from the sale of electric power, these budgets are passed to meet the letter of the law, while knowing full well that they will need to be adjusted before the end of the fiscal year.

Reports

Ø MAY METRICS. Superintendent will do a brief review of the performance of the Glasgow EPB metrics for May.

Ø FINANCIAL REVIEW. Superintendent will go over the financial metrics that are provided to the board members each month via access to the secure website. Newer board members should benefit from this explanation of what they are seeing on the website.

Ø JULY FCA. The Superintendent will go over the upcoming change to the Fuel Cost Adjustment for July, as dictated by TVA.

Ø CPD LEDGER. Since we altered our Variable Rate, at the request of a committee of our customers, to limit our peak predictions to four days per month, we have financial exposure when we miss the correct actual peak hour. To compensate for that exposure, we added a small amount to the wholesale cost of a peak kW, to collect funds to pay for missed predictions. The Superintendent will report on the status of that fund thus far in the fiscal year.

Ø OPEN MEETING LAW TRAINING. The Kentucky Attorney General ruled on the appeal of Glasgow Daily Times, regarding their complaint against EPB which alleged violations of Kentucky Open Meetings Law. The ruling found EPB violated the law by failing to respond to the complaint in a timely matter, consistent with the law. The Board elected to attend the training recommended in the GDT complaint. Tentative dates/times for the training are being pursued. Right now, KLC says they can do the training during the week of July 15. At the meeting I will be asking you to confirm a date and time for this training.

Ø WINDSTREAM BANKRUPTCY. Windstream Holdings (parent company of Windstream Company in Glasgow) filed Chapter 11 bankruptcy early this year. There is a large outstanding debt which is owed to EPB (about $40,000 now and increasing each month). To protect our interests and work to secure payment, as well as a suitable new relationship with Windstream going forward, I have engaged Scott Bachert, with the firm Kerrick Bachert PSC, to represent us in this matter. There will be a report on the progress at the meeting.

Ø TVA GREEN POWER PROGRAM. As directed, I’ve reopened the subject of how the Green Power Program pays developers of distributed generation projects for the energy they produce, with TVA. We went over the problematic issue relative to the amount TVA pays the developers, and they recognize the problem. I have been told that they are working on a solution that might make everyone happy, and that the details of that solution might be available for us to discuss at the meeting.

Ø LARGE OUTAGES. Historically I have given the Board reports when we have a service interruption that impacts over 200 customers. These reports help you field questions about these events, should you be asked. Large outages, and our response to them, gives board members a useful perspective on the decisions they are asked to make about infrastructure investments. The event we had in June impacted a total of just over 1500 customers. I look forward to discussing this event at the meeting.

Conclusion

Please let me know if you have any questions before the meeting.