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The Salem Electric Board of Directors met on February 24, 1998 at
7:00 p.m. All board members were present.
Conservation Report
Member Services Manager, Terry Kelly, reported that SE has found
a dimmable compact fluorescent bulb and may add them to the other bulbs offered
by the conservation department. Prior fluorescent bulbs required a special
dimmer that was quite expensive.
Kelly brought a recommendation to the board regarding SE's loan
program. In April 1993, the board implemented the loan program with a budget of
$150,000. In January 1994, the board increased the budget by $150,000 and
changed the variable interest rate to a fixed 5% rate. At the August 1996
board meeting, they added heat pumps to the loan program. This increased the
activity and loan amounts. In August 1997, the board approved an additional
$39,300 of unbudgeted BPA administrative funds to be included in the program.
Before adding heat pumps to the program, the loan account replenished itself by
loan payments. Increased loan amounts and loan activity has depleted the
available balance for new loans.
To avoid continued requests for additional funding from the
board, staff proposed that SE enter into an agreement with Commercial Bank to
adopt the current Salem Electric Loan Program. The following changes would be
made to the program guidelines:
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A $100 loan fee is required (half paid by SE, half by the
participant).
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The interest rate will be bought down by SE from 9.5%.
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A lien will be filed on each home.
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SE will guarantee each loan for the first 90 days.
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Maximum amount of loan will be increased from $5,000 to $7,500.
Salem Electric will keep the existing loans, totaling
approximately $335,000. A motion was made by Anderson, seconded by Culver
and carried unanimously to approve the staff recommendation.
Manager's Report
Manager, Bob Speckman, informed the board that SE will sponsor a
run as part of the Keizer Iris Festival. He said this fits nicely with plans to
be more visible in our service area.
Regarding the upcoming director election, Speckman said there
have been a total of eight petition packets picked up to date.
Purchase of BPA Substations
In 1996, BPA developed a rate structure that separated their
generation and transmission rates to comply with Federal Energy Regulatory
Commission (FERC) rulings. It was determined that any facilities at 34.5 kV or
below were not considered transmission and could not be included in the
transmission rate. BPA developed a delivery charge of $0.75 per peak kW per
month, to cover their costs for these facilities. For SE, this charge is
applied to all power received through Salem Substation, Salem Alumina
Substation and Brush College Substation. In 1997, this charge was
$457,000. BPA has offered to sell these three substations for a combined total
of $2,262,000. A private consulting firm was retained, with board approval, to
determine the feasibility of the substations and to assess their value. Motion
was made by Anderson and seconded by Wolf to accept the recommendation by staff
as presented and authorize staff to negotiate the purchase of the three
substations. Motion carried unanimously.
1998 Budget Adjustments
Motion was made by Anderson, seconded by Towslee, and carried
unanimously to approve budget adjustments to account for an extra $883,000 in
cash at year end. The surplus was due to increased revenue and power sales, and
unspent conservation budget funds.
Donation Request
A request for a donation of $1,500 was made by Mike Duggan,
Chairman of the Salem Concert Band. He said the members, all volunteers, each
pay $20 in membership dues to play in the band. They perform four times per
year at the Elsinore Theater. The donations would be used to aid in fund
raising to improve advertising and increase their audience.
Towslee and Wolf expressed concern about where the dollars would
be spent. Anderson suggested that this would be seed money used to help them
succeed. Motion was made by Anderson and seconded by Culver to contribute $500.
Motion carried with all members except Wolf voting in approval.
Other Business
Towslee reported that the General Manager Evaluation had been
completed and she would schedule a meeting with Speckman within the next few
days. Towslee also reported that the committee recommends that six-month
evaluations be discontinued and the general manager evaluation be done on an
annual basis, with the next evaluation taking place in January 1999. The
committee's motions carried unanimously.
--Bill Wolf, Secretary/Treasurer
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