The Board meets on the first and third Monday of each month. Meetings begin at 1:00 p.m. and are held in the department conference room at 65 Lafayette Ave, Littleton. Board meetings are open to the public and time is allotted for public comments at each meeting.
The regularly scheduled Board of Commissioners (BOC) meeting began at 1:00 p.m. on Monday, December 19, 2016 in the Littleton Water and Light (LWL) conference room. Present were Commissioner Eddy Moore, Commissioner Perry Goodell, Commissioner Ralph Ross, Financial Director Cheryl Wilkins and Superintendent Thomas Considine.
The minutes of the December 5, 2016 regularly scheduled Commissioners meeting were reviewed. Commissioner Goodell made a motion to accept the minutes as presented, seconded by Commissioner Ross.
The vote was in favor of the motion 3-0-0.
FINANCIAL DIRECTORS REPORT:
1. Mrs. Wilkins reviewed the financial statements for the month ended October 2016 with the Commissioners. Several discrepancies as compared to budget were discussed and explained by Mrs. Wilkins.
2. LWL personnel accompanied by an auditor from Vachon Clukay conducted a random sampling of the physical inventory (stock items). Several items from each warehouse were selected and the item counts verified and reconciled by the auditor to the material inventory totals captured by the compute. The auditor is scheduled to return to LWL on January 17, 2017 to conduct the 2016 year-end review of the LWL financial and operating statements.
SUPERINTENDENT/ GENERAL MANAGERS REPORT:
1. The LWL Christmas Luncheon was held on December 14, 2016 with Commissioners Moore and Goodell attending. Food and desserts were provided by The Topic of the Town Restaurant and French Sisters Bakery.
2. A Bethlehem customer (discussed in detail in Nonpublic Session) that utilized an unauthorized water service connection since 2004 took no exception to the terms contained in the BOC letter and made restitution. This customer is now in good standing with the LWL going forward.
GENERAL/ OTHER BUSINESS:
The BOC reviewed and discussed the 2017 operative budget for the electric division. Superintendent Considine provided the BOC with a brief power point presentation that depicted the major change anticipate.
As a direct result of previous power supply procurement by LWL aimed at hedging market price (budget stability), and an overall drop in wholesale power prices due to natural gas supplies, expenses are projected to drop by about $7.00 a Mw in 2017. This reduced MW price translates to an expected savings of almost one million (1,000,000) dollars for 2017. Weather conditions and the actual LWL system load will be the major contributing factors used to determine the savings realized by LWL.
Off-setting a large portion of the expected savings in power supply is the start of the ISONE newly structured Forward Capacity (FC) market. New requirements of the FC will result in a dramatic increase in capacity expenses over previous years. This is in response to the planned/ schedule closing of older grid generation assets (generating plants). The goal of the FC plan is to encourage the construction of new more efficient generating facilities reducing the carbon footprint in the process. LWL entered into several long term capacity contracts with generation owners to hedge the expected cost increase that are associated with LWL estimated capacity requirement of about 18,000 kw-month. LWL capacity costs are projected to be about $1.1 million dollars an increase of 1.57% over 2016. This cost increase only represents expenses incurred beginning in June 2017 or about one-half (1/2) the year. For 2018 capacity expenses are expected to be twice that of 2016 as these expenses will represent a full twelve (12) months.
Mrs. Wilkins explained that health insurance costs will increase in January 2017 by 5.3% and that a 2.8% increase across the board in labor (Collective Bargaining Agreement) is expected. The workers compensation expenses associated with the electric division are reduced to reflect actual cost centers as the hazard factors are higher when personnel are working on a water repair. Other general increase in expenses in property liability and computer security and networking are also expect to have a slight effect on the 2017 budget.
Superintendent Considine stated that the 2017 revenue projections are flat as compared to 2016 and that the only new load growth at this time appears to be the new Harbor Freight store on Meadow Street. Based on managementís projection the electric division is expect to attain a 5.6% margin which is slightly lower than the targeted operating ratio of 0.936.
The proposed 2017 capital equipment and projects list is being finalized and will be ready for review prior to the next BOC meeting. With the exception of the new line truck approved in 2016 (expected delivery by March 2017) and a new utility truck with plow for the water division no other major expenditures are being proposed.
Commissioner Goodell stated that in his opinion the BOC should wait to review the proposed capital improvements before approving the proposed operating and maintenance budgets. Following some general discussion the BOC agreed with Commissioner Goodells recommendation and made no amendments to the proposed electric division 2017 budget.
Commissioner Ross made a motion to adjourn the meeting, seconded by
The vote was in favor of the motion 3-0-0.
Meeting adjourned at 2:05 p.m.
The regularly scheduled Commissionerís meeting is held twice monthly on the first and third Monday, at 1:00 p.m., in the Departmentís conference room.