VILLAGE OF MORRISVILLE WATER AND LIGHT DEPARTMENT

November 2, 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: Tim Sargent, Ed DeBor, Wally Reeve, Peter Bourne and Dana Wildes

Staff: Craig Myotte, Jim Fontaine, Penny Jones and Linda Osgood

1) PUBLIC MEETING:

No members of the public were in attendance.

2) CURRENT PRIORITY PROJECTS:

The Board reviewed the status of the current priority projects.

3) MANAGEMENT REPORT:

The 2400 volt circuit has been converted to 7200 volts up to Bridge Street. The VELCO 115 KV line is now connected and energized. Crews replaced arrestors in the Pratt-Read sub. Crews are done working for VEC for the year. Generation appears to be on budget for the month of October but we need to get the divers to Cady’s Falls to seal the head gates so debris can be removed from the turbines. The flashboards cannot be replaced until the units can run better to draw down the pond.

Paving and fencing is complete at the WWTF. The concrete in the yard has been poured but electrical and ventilation is still behind schedule. Keymont is not concerned and still feels they will meet their completion date. The existing unit is running very well.

There still remains approximately 15 water meters to install. We remove a couple from the to-do list only to find more customers that need meters. East National is currently checking non-reading meters and checking the first plumber’s work. The project is still under budget. Of our 1,100 existing water customers, only approximately 200 already had meters.

The reservoir project is going smoothly. All pipes have been installed on the upper side of the road and the road has been finished. All valves are in place. They will move to Brigham Meadows, ditch under Route 15A and the railroad, and shut down for the winter around 11/25. Although the road is finished, it will need to be regraded once 80 trucks of gravel go up and down it.

The new development off Cottage Street will be customers of the WWTF but not the Water Department. The Board questioned the feasibility of private wells versus connecting to the water system. Jim informed the Board that the project would probably require a hydrant, which would require an eight-inch main. The cost of the eight-inch made private wells more feasible for them.

Penny has been spending most of her time on the water meter project and financing issues. She did hand out the SQRP filing for the Board’s review. Our lawyer has confirmed that we can lien property in other towns for unpaid electric services. September financials are almost complete.

The Board reviewed a list of all active liens held by this Department. On a motion by Trustee Bourne, seconded by Trustee DeBor and unanimously approved, the Board voted to send all properties MW&L has a lien on, except for 10 Railroad Street in Morrisville, to tax sale to collect unpaid electric, water, and sewer bills.

Now that the 115 KV line went into service on 10/29, we will need to watch the power flows carefully. The first couple of days show we are still taking most of our power from CVPS. We expected the power to come from the 115 KV line (VELCO). Hardwick and Johnson have expressed an interest in wheeling services and joint line ownership/lease. We should see the new transmission costs for the 115 KV line in December and CVPS’s wheeling charges should drop correspondingly. Craig needs to update our transmission summary. The B-22 loss settlement is difficult to track and the 115 KV line changed all the formulas. We are using new calculations beginning November 1^st.

4) APPROVE MINUTES OF REGULAR MEETING HELD OCTOBER 19, 2009:

The Trustees had several comments on the minutes. There was a minor editing and language regarding Copley was not correct and needed to be reworded.

On a motion by Trustee DeBor, seconded by Trustee Reeve and approved by majority, the Board approved the minutes of the October 19, 2009, regular meeting as modified. Trustee Bourne abstained.

6) APPROVE AND EXECUTE RESERVOIR SRF LOAN DOCUMENTS:

The loan for the reservoir project was approved at -3% for 30 years which equates to a 77% discount on the project costs.

On a motion by Trustee Wildes, seconded by Trustee Bourne and unanimously approved, the Board approved the reservoir SRF loan document for $1.3 million at -3% for 30 years.

The Union Bank will open a line of credit at 2.2% for $625,000 for one year instead of arbitrage. We will pay the contractors from the line of credit, submit re-imbursement to the State, and pay down the loan when the funds are received.

On a motion by Trustee Reeve, seconded by Trustee Bourne and unanimously approved, the Board approved the Union Bank line of credit at 2.2% on $625,000 for one year.

7a) APPROVE BUILDING LOAN REFINANCING:

On a motion by Trustee Wildes, seconded by Trustee Reeve and unanimously approved, the Board approved the Union Bank mortgage to refinance the existing indebtedness on the office facility. Monthly payments will be $4100 instead of $4500.

11) EXECUTIVE SESSION:

At 7:00 PM, on a motion by Trustee Debor, seconded by Trustee Bourne and unanimously approved, the Board went into Executive Session to discuss contracts.

At 7:35 PM, on a motion by Trustee Wildes, seconded by Trustee Bourne and unanimously approved, the Board came out of Executive Session.

6) APPROVE/SIGN IBEW AGREEMENT:

On a motion by Trustee Reeve, seconded by Trustee Wildes and approved by a majority, the Board approved and signed the IBEW Agreement. Trustee DeBor voted against the motion.

8) DISCUSS HYDRO REPORT AND FUTURE POWER SUPPLY STRATEGIES:

Not much to update other than Craig has contacted the SPEED facilitator to see if the proposed upgrades would count towards our SPEED requirements. The Board reviewed power supply costs updated through September. We are above budget by approximately $92,000 or 2.8%. Metered load is down 1.4% from budget. The variance drops by $45,000 if you remove the VT Transco equity purchase. To prepare for the upcoming budgets, Craig would like to work in SPEED requirements, lost generation, and loss improvement. Trustee Bourne would like to see the opinion of the SPEED facilitator in writing and then go ahead with replacing the 600 kW unit at Cady’s Fall. Trustee Reeve wondered if we should tackle all of the projects at one plant at one time then move to the next plant or tackle the major projects at all three plants. Trustee Bourne would like to see the feasibility of having a plant operator again to coordinate the operations of the units to coincide with peak market prices during peak loads. Trustee DeBor wanted to clarify that the 600 kW unit at Cady’s Falls has not been non-operational for seven years, only the last year and a half. It certainly has not run anywhere near capacity for quite a long time but it was running.

9) RATE MITIGATION STRATEGIES:

Tabled until next meeting.

10) OTHER BUSINESS:

Craig has been meeting with the Land Trust to discuss the time schedule and other issues for them to purchase that property. Craig is holding off having them make a formal presentation to the Board until the Board decides if they want to publically advertise this parcel. The Land Trust is asking that we not actively advertise until the property is appraised. Craig hopes to have a “yellow book” value before year-end. Trustee Wildes is not in favor of signing anything that restricts us from advertising.

Craig needs to finalize the Patnoe property transaction now that the ROW issues are solved.

If the Board has any further thoughts or questions for the Energy Efficiency Utility, they are anxious to answer them. Trustee Wildes would rather see an auditor’s annual report on the EEU rather than the EEU’s annual report. He also questions why VPPSA is not an active participant with CVPS and GMP in acquiring EEU funds for municipalities.

Staff hopes to have a very rough draft of 2010 budgets by December 17^th meeting.

Craig asked the Board to review the schedule of Board meetings for 2010 and compare that with their annual agenda schedule.

12) ADJOURNMENT:

At 8:35 PM, on a motion by Trustee Bourne, seconded by Trustee Wildes and unanimously approved, the Board adjourned the meeting.

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Edward DeBor, Clerk