VILLAGE OF MORRISVILLE WATER AND LIGHT DEPARTMENT

January 19, 2009

MONDAY 6:00 PM

Water and Light Office

The meeting duly noticed and warned was called to order at 6:00 PM.

PRESENT:

Trustees: Dana Wildes, Tim Sargent, Peter Bourne, and Ed DeBor

Staff: Craig Myotte, Jim Fontaine, Penny Jones

GUESTS: Ernie, Tracy and Blake Patnoe, Mary Ann Wilson (by telephone)

ABSENT: Trustee Thompson

1) PUBLIC MEETING:

Mr. Patnoe expressed concern with the lack of progress on resolving certain property issues with the Village Trustees. Mr. Patnoe reiterated his desires to the Trustees. The Trustees stated that they will follow-up on the appraisal that was offered in the December 30, 2008, letter from the Trustees. The Trustees reminded the Patnoes’ of constraints on the amount that can be paid by Vermont State Law. Chair Wildes stated the Village must approve property purchases based upon value. MWL staff will work to have the appraisal and negotiations with the Patnoes’ completed in time for the action at the Village Annual meeting. The time line requires the negotiations and agreements need to be completed by March 2. Craig stated he will be responsible for getting the appraisal done and negotiating with the Patnoes’ on behalf of the Trustees.

2) Discuss Electric Cash Flow Issues:

The Trustees had a lengthy discussion with staff regarding the current electric cash flow issue and the best way to resolve it. Chair Wildes asked Penny for a recommendation. Penny recommended that the Trustees utilize a portion of the Green River fund interest and dividends. At this time, the Green River Fund investment has a balance of approximately $1.6 million. A portion of these funds has already been earmarked for a facility purchase. The Trustees made it clear that they don’t want to utilize Green River Fund principal for covering operating expenses. Craig stated that he believes that the VELCO equity purchases and the planned electric facility purchase exceed the original $2.5 million principal amount. The Trustees asked Penny to check the level of 2007 and 2008 interest and dividends. The cursory review of the numbers shows a value in excess of $400,000. The Trustees asked Penny to update and distribute the Green River Fund summary through December 31, 2008.

On a motion by Trustee Bourne, seconded by Trustee Sargent and unanimously approved, the Board approved the expenditure of up to $400,000 of interest and dividend from the Green River Fund to reduce operational debt.

6) APPROVE 2009 ELECTRIC BUDGET:

Chair Wildes stated that he recommended that the agenda be modified to take up the 2009 Electric budget (Item 6) on the agenda. Approving the 2009 Electric budget tonight is critical and needs to take priority over the remaining items on the agenda.

The Trustees had a lengthy discussion with staff regarding the 2009 Electric budget. The proposed budget shows a loss of $148,000 on the income statement using the latest power supply budget from VPPSA. Staff had a number of discussions with VPPSA regarding the power supply budget. In addition staff offered other cost containment measures that can be considered. These included reduce outside services for tree trimming, reduce overtime, reduce vehicle idling and excess travel, eliminate training expense, reduce work week hours, increase the level of outside services performed for others, manage supplies, purchase programmable thermostats to reduce building heating in the evening, reduce workforce, miscellaneous reduction in small expenditures, and improvement in processes. The Trustee left it up to staff to determine which cost containment actions to pursue.

Chair Wildes stated that we need to file for a rate increase as soon as possible. Penny replied that we have asked VPPSA to file a rate case based upon 2008 final results after the audit is done. The case could be filed in mid-April 2009 and rates could go into effect around June 1.

On a motion by Trustee DeBor, seconded by Trustee Bourne and unanimously approved, the Board approved the 2009 Electric expense budget as provided by staff at the meeting.

On a motion by Trustee Bourne, seconded by Trustee DeBor and unanimously approved, the Board approved the 2009 Electric capital budget of $600,000 (covered by the remaining 2007 bond funds) as provided by staff at the meeting.

Chair Wildes asked the Trustees to revisit the approved water budget. He suggested that the Trustees amend the water budget approved at the previous meeting to make proceeding with the Maple Street project conditional on receiving acceptable economic stimulus funding.

On a motion by Trustee Bourne, seconded by Trustee Sargent and unanimously approved, the Board amended a water budget of $3,007,800 conditional on receiving acceptable economic stimulus funding for the Maple Street project.

5) APPROVE MINTUES OF MEETING HELD JANUARY 5, 2009:

The Trustees noted several edits required to the minutes. The Chairman tabled the minutes. Staff will revise the minutes to incorporate comments received and resubmit the minutes at the February 2, 2009, meeting for approval.

9) DISCUSS ANNUAL MEETING TIME LINE:

The Trustees conferenced with Mary Ann Wilson by telephone to discuss the annual meeting time line. There are a number of items that need to be completed including the Warning, Manager’s Report, Employee picture, Chairman’s Report, and Trustee picture. In addition, Mary Ann reminded the Trustees of the need for a person to dedicate the Annual Report to. There was a brief discussion on the location due to a conflict at the school. There was a brief discussion on modifying the line of credit article for the 2009 warning.

11) EXECUTIVE SESSION:

At 8:20 PM on a motion by Trustee Bourne, seconded by Trustee Sargent and unanimously approved, the Board went into Executive Session to discuss contracts.

At 8:25 PM on a motion by Trustee Bourne, seconded by Trustee Sargent and unanimously approved, the Board came out of Executive Session. No action was taken as a result of the Executive session.

12) ADJOURNMENT:

The Trustees tabled the remaining agenda items. At 8:25 PM, on a motion by Trustee Bourne, seconded by Trustee Sargent and unanimously approved, the Board adjourned the meeting.

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Tim Sargent, Clerk