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HomeMy WebLinkAboutBradley Lake PMC Meeting-Thurs., March 31, 2005 6 If you are unable to attend the meeting in person, please use the following phone instructions: TELECONFERENCE INSTRUCTIONS Thursday, March 31, 2005 — 10:00 a.m. To join the meeting, please do the following: Dial 1-800-315-6338 Enter 813# Alaska Industrial Development and Export Auth AIDE Alaska Energy Authority BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING AGENDA Thursday, March 31, 2005 — 10:00 a.m. (Via electronic media at AIDEA/AEA — 813 W. Northern Lights Boulevard) (Corner of Arctic and Northern Lights Boulevard) i CALL TO ORDER Haagenson 2 ROLL CALL (for Committee members) 3. PUBLIC ROLL CALL (for all others present) 4. PUBLIC COMMENT 5. AGENDA COMMENTS 6. APPROVAL OF MEETING MINUTES November 18, 2004 is NEW BUSINESS A. Approve Utilities’ FY04 Deficit Repayment to the Project Cunningham B. Approve FY05 Budget Changes to Increase Expenses for the Property Valuation & R&C Fund Repayment Cunningham C. Approve June 2005 Transfer from the Revenue Fund to the R&C Fund Cunningham D. Approval of FY06 Budget Cunningham Es HEA O&M Contract Extension Term Stead/Copoulos as Turbine Runner Replacement — Risk Analysis, FUJI Contracts, & Replacement Recommendations Audit Approval Stead/Hickey/Copoulos 8. COMMITTEE REPORTS ./ COMMENTS A. Operators Report 1: Governor Project Status Stead 2 Budget Committee Report/Appraisal Audit Update Cunningham B. Next Meeting Date Haagenson 9. ADJOURNMENT 813 West Northern Lights Boulevard * Anchorage, Alaska 99503 QN7 /9AQ-2NNN ¢ FAX 9N7 / 749-2044 * Toll Free (Al ASKA ONI Y) 888 / 300-8534 © www aidea ars BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING MINUTES A 813 W. Northern Lights Boulevard & Anchorage, Alaska ab Thursday, November 18, 2004 — 9:00 a.m. \ ls CALL TO ORDER Chair Haagenson called the meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 9:00 a.m. on Thursday, November 18, 2004, from the Alaska Industrial Development and Export Authority's Board Room, Anchorage, Alaska, to conduct the business of the Committee per the agenda and public notice. 2 ROLL CALL Roll was called by Brenda Fuglestad. The following members were present: Steve Haagenson Golden Valley Electric Association Joe Griffith Chugach Electric Association Bradley Janorschke Homer Electric Association Wayne Carmony Matanuska Electric Association (teleconference) Jim Posey Anchorage Municipal Light & Power Dave Calvert City of Seward Art Copoulos Alaska Energy Authority 3. PUBLIC ROLL CALL Mike Cunningham, Chugach Electric Association (teleconference) Rick Baldwin, Homer Electric Association (teleconference) Ron Miller, AEA/AIDEA Brenda Applegate, AEA/AIDEA Karl Reiche, AEA/AIDEA Ron Saxton, AterWynne Rick Miller, Anchorage Municipal Light & Power John Cooley, Chugach Electric Association Doug Hall, Anchorage Municipal Light & Power Bob Price, Anchorage Municipal Light & Power Ed Ruebling, Anchorage Municipal Light & Power Brian Hickey, Chugach Electric Association Lee Thibert, Chugach Electric Association Bradley Lake PMC Meeting November 18, 2004 Page 2 of 8 &\ Don Zoerb, Matanuska Electric Association (teleconference) 9 ® 4. PUBLIC COMMENT Y There were no public comments. 5. AGENDA COMMENTS Mr. Griffith stated he understood there was an instruction to eliminate Item 7D — AEA Electrical Assets to Railbelt Utilities - Discussion. With the agreement of the group, Mr. Griffith suggested to leave Item D on the agenda. The new title of Item 7D will be Future of the Bradley Lake Project. Chair Haagenson also added an item - Status of the Insurance Study — noting that it will be a question for Mike Cunningham. 6. APPROVAL OF MEETING MINUTES — March 18, 2004 Mr. Griffith moved to approve the meeting minutes of March 18, 2004. Seconded by Mr. Calvert. A voice vote was taken, and the minutes were unanimously approved. 7A. AUDITENGAGEMENT LETTER Chair Haagenson Chair Haagenson wanted to inform the BPMC that the audit is in process now, and a letter was sent out to the auditor. 7B. 2004 Policy Year Renewal — Valuation Chair Haagenson Chair Haagenson made note of the letter received from ARECA Insurance Exchange thanking them for renewing the insurance for next year. 7C. LEGAL REVIEW OF BPMC CONTRACTS Chair Haagenson Chair Haagenson noted that the concept came up of who was performing legal review on contracts and the one discussed was the Bradley Lake Runner Modifications and Design. The questions are, who is the attorney for the BPMC that is doing the legal review, and are we doing our due diligence by not having someone legally review it for the BPMC? Mr. Saxton stated that the question in all of these contracts, is who is at risk, also stating that if the review needs to be done you need to follow the risk. MOTION: Mr. Carmony moved that if it’s the opinion of the body that these contracts need to be reviewed that the BPMC should hire an independent legal firm to conduct that review. Mr. Griffith seconded the motion for discussion purposes. November 18, 2004 Page 3 of 8 gs Mr. Carmony stated that he believes there is conflict of interest in having the BPMC legal work performed by AterWynne. Chair Haagenson reminded the BPMC that AterWynne has been counsel since day one, and there are actually letters on file where they have all accepted them to be counsel. Mr. Carmony added that AterWynne is the attorney for Golden Valley, and also because they are involved in hostile legal proceedings against MEA, he does not believe that they can properly represent the BPMC. Bradley Lake PMC Meeting us \ Mr. Griffith asked what were the hostile actions against MEA? Mr. Zoerb from MEA responded to that question on behalf of Mr. Carmony. He stated that AterWynne is presently representing several utilities in an action by the Regulatory Commission of Alaska that MEA views is hostile to its interests. In addition, AterWynne has in the past been counsel of record on behalf of Golden Valley in lawsuits filed against MEA. Therefore, MEA believes that constitutes a conflict of interest and would impair their ability to independently evaluate risk from MEA’s standpoint as a participant in the BPMC. Mr. Saxton noted that it’s been clear and he’s responded to MEA repeatedly on this, and his representation of this group is just that, representation of the group. It is not representation of any individual member of the group, and therefore, he advised the BPMC that this does not constitute representation of MEA individually or any other utility individually. Mr. Copoulos pointed out that AEA is not prepared to vote on the current motion until legal counsel arrived to the meeting. Mr. Janorschke added one more observation. Talking about assessing the risk to the participants and the BPMC, and in the event the attorney making that evaluation is not independent, we lack confidence that a disproportionate sharing of risk would be properly evaluated from our point of view. In other words, we're not confident that the evaluation of risk to the body would necessarily translate into an evaluation of the fairness of the apportionment of that risk to the participants in the body. Chair Haagenson asked Mr. Janorschke if he was implying that when AterWynne does a review for the group that they are going to favor Golden Valley in any way, shape, or form. Mr. Carmony also noted that this was not what he said. He believes their statement should stand on its own. MOTION: Mr. Griffith moved to table the motion until AIDEA counsel arrived to the meeting. Seconded by (inaudible). Mr. Griffith also pointed out that there is a point of order on it, and currently there is a motion on the table by Mr. Carmony. Mr. Griffith thinks the tabling supersedes Mr. Carmony’s motion. Bradley Lake PMC Meeting November 18, 2004 ea WA AS Page 4 of 8 \ Chair Haagenson stated that the motion on the table now is to table the discussion until Brian Bjorkquist shows up to the meeting. Motion tabled. 7E. STATUS OF THE INSURANCE STUDY Mike Cunningham Mr. Cunningham informed the group that the main open item was a proposal received from Stone and Webster to do an appraisal of the property, which was one of the recommendations that came out of the study. The study produced about 34 recommendations in total. Those were forwarded to the ARECA Insurance Exchange (AIE). Discussions with the State regarding waiver of subrogation issue are in place. The biggest issue is the appraisal of the property in order to bring the replacement values in line, and also there was an issue with the powerhouse value in case of a loss. Mr. Cunningham also noted that the cost of the valuation was $75,000 and that includes the powerhouse. As soon as we give them the okay, we have to do a budget amendment to cover it. Mr. Griffith stated he thinks there is a need to get the valuation, but whether that’s the right number or not, he didn’t know. He also asked if there was any feedback from AIE at all on where we are in the appraisal process. Mr. Cunningham responded that the State concurs with getting an appraisal, as does AIE. The consultant went out and solicited proposals and they received a response from Stone and Webster and there was also one other response but that was not for a total appraisal — that was just to do the valuation of the powerhouse, which was an outstanding item at the time. He also stated that based on their discussion of it, he thinks we’re getting more than a valuation — we’re going to get some software to do an annual update on it, things of that nature. There are some things that would benefit the project and certainly the valuation for insurance purposes in the future. Mr. Cunningham said he would get the committee’s recommendation back to the BPMC through the Chairman, and that there will also need to be a budget revision. 8A. RUNNER REPAIR Don Stead Mr. Stead informed the group that this is a combined report in which he and Brian Hickey will present together. They discussed the test rig that was used in Switzerland, the runner, the needle components, overview of the control problem, results they received in Switzerland, and the runner interactions they saw. They also reviewed some various failures and runner replacement. The slide presentation has been attached for review. Discussion ensued following the slide presentation. Mr. Stead noted that the quote we have gotten from FUJI for a new runner is $1.6 million, and in the routine discussions talking with VA Tech, they’ve said around $1 million. The O&D Committee never really said to go put forth a recommendation. They Bradley Lake PMC Meeting & \ November 18, 2004 \ Page 5 of 8 AW wanted us to start this background study and let you know where we're headed, but we haven't heard them yet say we’re going to buy a new set of runners. Mr. Copoulos said they will be meeting soon. Mr. Stead asked the O&D Committee if it takes a year and a half, are there short term things — they were talking about monitors, lower the head of the reservoir, those kinds of things. Mr. Stead also informed the group that the worst case scenario is a needle comes off the wall and you’re unable to control the unit. We'll shut the turbine stop valve and if the turbine stop valve doesn’t stop it, then shut the gate. Chair Haagenson asked the O&D Committee to look at some failure modes and probability — how much risk do we really have, and to coordinate with Mike Cunningham’s section in insurance, to make sure we've got adequate insurance. Mr. Copoulos added that we’re in the middle of a hydraulic transient analysis as a part of this project, because the needle speed is also being looked at as part of this project to address the whole spin issue. We’re in the middle of finalizing that analysis and that will give us some idea of what the windows are for the worst case scenarios. We've informed FERC that this is ongoing, and we've categorized it as a maintenance issue, which really isn’t of issue to them; they’re more interested in other things. We haven't really thought about it in terms of probabilities. Art Copoulos is going to find the FUJI contracts and share them with Brian Bjorkquist and Ron Saxton. MATTER OF RECORD: Mr. Griffith wanted to make it a matter of record that we sent those instructions out to the O&D Committee to take a look at it, and for the attorneys to look at the regulatory implications of it, now that we’ve heard the mechanical and hydraulic view. Chair Haagenson also added that the O&D Committee needs to make a recommendation on what to do with the existing runners and getting new runners, and look at the probability of failure in the interim. Mr. Stead provided the following update on the governor. There has been a Notice to Proceed issued for the jet divider, manufacturer, and installation. That has been added on to the project. They probably will invoice us quickly on the model test results, which is 30% of $1.2 million; so they will be invoicing us for that work since the model test report has been issued. Things are progressing, but we still expect to shutdown on time and get started on time for the governor replacement next year. Mr. Posey added that if we’re talking about replacing both within the next five years - we need to figure out a mechanism of how we're going to accomplish that. Mr. Saxton noted that you either have to let your rates bump up by a significant amount a year or need some other funding arrangement. Then we start talking about where are November 18, 2004 Page 6 of 8 Qs you also making Intertie repairs or whatever else is out there that’s a railbelt issue that you might want to somehow package together if you’re going to do some financing. Bradley Lake PMC Meeting & \\ at Chair Haagenson asked if that meant to start recovering in advance — by increasing our budget to put money into the R&R fund. Instead of just waiting to spend the money in a year, we've got a year and a half we could start pre-funding it and it makes it a six year event instead of a four or five year event. Mr. Stead responded that he thinks you have to look at the contract to see if you are allowed to bump up the R&R fund. If you are, then you should have a mechanism to do it, if you’re not, you don’t have a mechanism to do it, because all the funds at the end of the budget year have to be returned to participants. Mr. Griffith asked that the Finance Committee give the BPMC a recommendation on it. 7C. LEGAL REVIEW OF BPMC CONTRACTS Chair Haagenson Chair Haagenson went back on the Agenda to Item 7C, which is Legal Review of BPMC Contracts, stating that the discussion had to do with who should be doing the legal review for BPMC contracts. There is a motion on the table that if it’s the will of the body then you would recommend having independent counsel reviewing contracts as opposed to AterWynne, and we have a second on that motion. At that point we tabled the motion. Mr. Saxton clarified that it has always been the case, and remains the case, that he is actually the attorney for the utility members of the BPMC; Brian Bjorkquist is the attorney for the State. What they do as a practical matter, is because the vast majority of items are not adverse between the State and the utilities, is the utilities essentially loan me to the committee, so if it’s a FERC matter and Art needs help, | work with him on behalf of the committee, but that’s because the utilities have made me available to do that task, that’s true 99% of the time again, an issue where the utilities were adverse to the State, clearly Brian’s the State’s lawyer, I’m not, that’s just a clarification. Mr. Copoulos responded that in light of Mr. Saxton’s statement, AEA’s position is to abstain. MOTION: Mr. Griffith moved to take Item 7C off the table and put back in place Mr. Carmony’s original motion. Chair Haagenson stated that we have a motion to bring Item 7C back on the table. Motion and a second (inaudible). Mr. Carmony asked for a roll call vote. Chair Haagenson restated the motion: Retain independent counsel, not AterWynne, is the indication, independent counsel, to review BPMC contracts. So if you vote in favor of that motion, we need to select a new attorney for the review November 18, 2004 v2 ‘ Page 7 of 8 gs of contracts, if you vote against it, then it means the motion fails, it doesn’t mean anything. Ca % \ Bradley Lake PMC Meeting \\ § Roll Call Vote: City of Seward: No Matanuska Electric: Yes Chugach Electric: No Homer Electric No Golden Valley: No Municipal Light & Power: No Alaska Energy Authority: Abstain Motion fails. Mr. Saxton added that future contracts to put any risk on the BPMC utilities should be reviewed by himself or counsel on the BPMC’s behalf. MOTION: Mr. Griffith motioned that utility attorney review of contracts that affect the utilities collectively, or Bradley Lake counsel review contract review, that affects the utilities. Second (inaudible.) Mr. Saxton also added that the contracts entered into by contractors for the project, if those contracts impose any risk on the BPMC utilities, then the BPMC’s utilities counsel should review those contracts. Roll Call Vote: City of Seward: Yes Matanuska Electric: No Chugach Electric: Yes Homer Electric: Yes Golden Valley Electric: Yes Municipal Light & Power: Yes Alaska Energy Authority: Abstain Motion passes. 7D. Future of Bradley Lake Project Don Stead MOTION: Mr. Griffith motioned that the Bradley Lake Budget Committee be instructed to identify the costs and the scope of the effort on an activity to undertake the transfer of Bradley Lake. Project ownership to the utilities. Seconded by Mr. Janorschke. Chair Haagenson stated that there was a motion on the table, which indicates that the Bradley Lake Budget Committee identify the cost and scope of the effort to consider the transfer of Bradley Lake Project to the utilities by January 15, 2005. \ Bradley Lake PMC Meeting November 18, 2004 ~ vs Page 8 of 8 Qu Steve Haagenson asked for a show of hands and a voice vote. The majority of the group said aye, Mr. Carmony from MEA voted nay, and AEA abstained. 8B. Next Meeting Date The next meeting will be at the call of the Chair, and you can expect a recommendation back from the Finance Committee. 9. ADJOURNMENT The meeting was adjourned at 11:30 a.m. BY: Steve Haagenson, Chairman ATTEST: Alaska Energy Authority, Secretary Bradley Lake Governor and Turbine Runner Tailrace No Deflectors Test lab Tailrace With Deflectors In-Stream Brian seemed to always be sleeping Runner/Nozzle/Jet Divider ca Brian and Joseph adjusting the deflector position Or lying about Test rig from the top Model Runners and Eroded Bucket Model Deflectors What we found out + Significant improvement in the slope of the position vs. power curve. Amplitudes of the torque effects on the model shaft are reduced. An improvement of one percent in efficiency can be had if a VATech runner is used. + Cracks may not be caused by the oscillations Part 'STALDEN/ 60 County. ‘Swazeriand Constvecton 1960 2 rormonta goubie ‘kebines wih Wo jt naR2NWA Heat 1016.8 (my G+ 1030" mvs) Pon 91680 (Mw) 24288 (min) D,=25'604 fm 2,=07'860 [mm 8 = 600 (mm h = 2 Bwet 1 =16200 Dg) 6-202 CFM 14 cast G.Fecner (43%) TAUPE Damage: Ruplure o bucket No, 19 of rumer€ ater 64897 operaing hours on August 7.1887, Crack stated on back of bucket Consequential arhages:rures housing anc perforated Doug rot. Reasons: Materia oetect Stag inctusion 2x4 mm frye, 0.5 fn) Underneath te sure. Unfavorable sresses, Crack was not —— origin of crack ata slag inclusion : : i : : | z 3 ‘was nat tested, Total machine crash house — Covey Damage: Rupture of 3 buckats after 27x 10 ® stress cycles tone ‘causing @ total crash of te turbine due to imbalance. | | » Date of disaster: 31 Aug. 1978. weet Matwiat ——@- YTOCYNS 1 cat Reasons: Welding repairs due to sand ebrasion executed by the | | Femey = na customer in 1973, enhanced residual stress, corrosion | | Chage-Ne: na fatigue, too long inspection interval Inspect Ite stout 2 yeas Rupture of bucket Rupture of bucket Prot ‘GUATAPE/TS as. oy Bowe 1907 (Spar- Runner) Speccat Oat 2 honor out int wa {tine nth one ot (ie era re n2R2NA Fatigue rte sutace 60 - (59 sot actrees) Satis el re 1816 ‘Damages Rope of bck Wa 10, noe Ne . 1048 epuraton bor 5% 10" ares | 0.1412 fo ‘ion 3ehaen 01 Contour aonb bd {nmin nc soe meant bec {Enum soe oe Net = Buca Reasons: Du onadaguate srs reba haat e treumart ater rear wang wer he 2500 gt harénvs eft manawa te Nag {84} and high esl sreaes remand 6-35 Cr 13.4 cam landag we crating and rapier grown Fundicion de Aaa, € Residual righ aoe ‘Damage Rupr of buck Wa wr 978 operation haus (478. 108 stone Steines ie Reasons Woldng rape wiovt any pabening and wihod ss at had utr gor ap po tn mig (a of era Rupture of bucket VAAL REEFS 4761 Seah Aion 18 SOUTH FORK TOLT anaes maccaes ‘iapearidis In-service 1995 nn ‘with two ete Head 271M ninan Output 16 MW i Material CA6NM Serie Ihe Failed at a small wnt Inn} inclusion aren From a factory weld 0-10 bod repair = Bucks m4 100 ons ois suzer Coven gu. Th gy eserves sua oun 3 SRevemaning ut win tt how poe en: dace Tn oth =e Insane pened. Tape of book Nal ater S200 operon hows on 1 Febuary 1908, Lessons learned Post weld heat treat is the only way to ensure weld stresses are relieved Post weld heat treat of high hardness stainless steels are difficult to control Occlusions left in weld will still cause a problem even if the heat treat is performed well Any weld repair needs to be watched closely 4. Objective: ‘+ ‘Avoid resonances f forced bucket vibrations due tothe pulsating jet oad. + Reduce the amount of superimposed demic bucket sess, + Gerantes suficient dmamic strength, safety end iene of mut.jet Pelton runners. ‘+ Differenciate between diferent quay standords stool cast - MeroCast— HWELD—futy forged ‘+ Optimize the final balancing process in connection weh detuning 2. Basic procedure remarks The besice procedure is dtinedin the Accertance Standard for Pelion Runners T HH 405 06 002 as, follows: 41. Atrunners of 4,5. und 6 jet turbines the bucket natural frequencies ere tobe measured (basic ‘modes of bending endtersion) 2. if hematura frequency o the dominent bending mode coincides wth a harmenic ofthe jet pulse frequency experienced y eech runner the concemed bucket hes tobe detuned as long as the frequency is inside of the forbidden frequency zene. ‘The detuning is executed by grinding on the backside cf the bucket. ‘The process is tobe combined wth the nner baencing DETUNING OF PELTON RUNNERS based on the VATECH HYDRO Technical Guide Line T HH 405 06 005 Sept. 2004 Richard Angehrn VATECH HYDRO LTD. Zurich Pelton Bucket, Typical Stress Tace Ao, /2 |Ao, = superimposed \dynamic stress part due ito harmonic response \Ao,= dynamic stress part due to jets io, = centrifugal stress ©, = stress amplitude ot ©, = mean stress Bucket stress traces at a 6-jets Pelton turbine with rotating speed 500 min-1 a) before detuning Bucket natural frequency 700 Hz and exact resonance with the 14th. harmonic of excitation frequency b) after detuning Bucket natural frequency 702.5 Hz Measurement ofthe acceteration as hammerng response executed on acast steel nniner Genvere’ at ‘Be Begening ofthe GOies (former bucket design) relative amplitude a8 5 Vaqgemmnn 2 0 DRON (n=428.6 rpm, z,=5 jets) bucket excitation spectra 1.3 § 7 9111315 17 19 21 23 integers i ofhat 2 4 6 8 1214 16 1820 22 ofbasic frequency rererenny 100 200 300 400 500 600 700 800 900 frequency [Hz] f, = 160% {=i ve BAS a... Het 3. Evaluation of the Necessity for Detuning \VA TECH HYDRO has intemal reguiations in which cases of a bucket resonance a risk coud occur and detuning is stringent. The method presumes the knowledge of the natural frequencies. In normal cases an adequate FE- analysis is not avaiable and a frequency measuremert by hammering is necessary. If detuning is recommended or stringent it has to be proceeded by the intemal guide lines. In ether case @ measuring protocol is mandatory. Runner Billet Additional Lessons Learned * There is an inherent risk for cracking and rupture at monoblock cast Pelton runners which cannot be reduced to zero, even by consequent application of inspections within rather short periods. + Testing also of the back side of the bucket root is essential + Vibration monitoring of the units is highly recommended + The experience with MicroGuss over more than 12 years has shown that the risk of cracking is practically eliminated thanks to forging the critical transition zone from the disk to the buckets. + No root cracks have been observed in none of the more than 200 delivered MicroGuss runners. MicroGuss allows for a troublefree operation and needs minimum care at doing NDT. + By using MicroGuss the inspection periods can be extended by a factor of four. First cuttings Welded bucket Ready for Delivery Final machining Agenda Item: 7A Approve utilities’ FY04 deficit repayment to the project. |» 4 eanm 4 C : (3 ¥42,o Move: Second: AUDITED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE OPERATING AND REVENUE FUNDS JUNE 30, 2004 AND 2003 Parisena, Stromberg & Company — A Professional Corporation Audited Financial Statements and Other Financial Information BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE OPERATING AND REVENUE FUNDS Independent Auditor's Report Balance Sheets Statements of Revenues, Expenses and Changes in Surplus Statements of Cash Flows Notes to Financial Statements Independent Auditor's Report on Additional Information Statements of Expenses on 1 eo 10 11 A Professional Corporation Certified Public Accountants 3201 C Street, Suite 405 Anchorage, Alaska 99503 Tel. (907) 563-4547 FAX (907) 561-7683 Independent Auditor's Report Bradley Lake Project Management Committee Anchorage, Alaska We have audited the accompanying special-purpose balance sheets of the Bradley Lake Project Management Committee Operating and Revenue Funds (a project management committee) as of June 30, 2004 and 2003, and the related special-purpose statements of revenues, expenses and changes in surplus, and of cash flows for the years then ended. These financial statements are the responsibility of the Bradley Lake Project Management Committee. Our responsibility is to express an opinion on these financial statements based on our audits. , We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. The accompanying special-purpose financial statements were prepared for the purpose of complying with, and in conformity with the accounting requirements specified in Note A, and are not intended to be a presentation in conformity with generally accepted accounting principles. In our opinion, the special-purpose financial statements referred to above present fairly, in all material respects, the assets, liabilities and surplus of the Bradley Lake Project Management Committee Operating and Revenue Funds as of June 30, 2004 and 2003 and its revenue, expenses and changes in surplus and its cash flows for the years then ended, on the basis of accounting described in Note A. This report is intended solely for the information and use of the Bradley Lake Project Management Committee and is not intended to be and should not be used by anyone other than this specified party. (Groene More ban ~ Logan. Pe Parisena, Stromberg & Company, APC Anchorage, Alaska October 22, 2004 ( BRADLEY LAKE I xJOJECT MANAGEMENT COMMI” UE OPERATING AND REVENUE FUNDS BALANCE SHEETS June 30, 2004 and 2003 2004 ASSETS Current assets: Investments (Note B) $ 294,998 Accounts receivable - Utility contributions receivable (Note E) 73,492 Total assets $__ 368.490 LIABILITIES AND SURPLUS Current liabilities: Due to other funds $ 97 Accounts payable 368,393 Total liabilities 368,490 Surplus (Note E) - Total liabilities and surplus $ 368.490 See accompanying notes to the financial statements. 2 2003 $ 2,443,835 2,689 $2,446,524 $ 39,456 393.687 433,143 ———— eee 2,013,381 $2,446,524 | ) BRADLEY LAKE P JECT MANAGEMENT COMMIT E OPERATING AND REVENUE FUNDS STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN SURPLUS Years ended June 30, 2004 and 2003 2004 Variance Favorable 2003 Budget Actual (Unfavorable) Actual Revenues: Utility contributions, net of surplus refund $ 12,745,705 $12,819,194 $ 73,489 $ 14,409,219 Interest receipts 1,559,059 1,850,365 291,306 1,840,740 Other miscellaneous - - - 2,688 Total revenue 14,304,764 14,669,559 364,795 16,252,647 Expenses, fixed asset replacements, refunds and debt service: Operations and maintenance 3,922,345 4,287,073 (364,728) 2,801,124 Debt service 12,273,400 12,273,400 - 12,268,075 Fixed asset replacements 11,000 11,067 (67) 29,130 Interfund transfer 111,400 111,400 - - Total expenses, fixed asset replacements and debt service 16,318,145 16,682,940 (364,795) 15,098,329 Excess (deficiency) of revenues over expenses, fixed asset replacements, refunds and debt service (2,013,381) (2,013,381) - 1,154,318 Surplus, beginning of year 2,013,381 2,013,381 859,063 Surplus, end of year De I Mes |) pe Is $2,013,381 See accompanying notes to the financial statements. 3 BRADLEY LAKE rpROJECT MANAGEMENT COMM11 1 £E OPERATING AND REVENUE FUNDS STATEMENTS OF CASH FLOWS Years ended June 30, 2004 and 2003 Cash flows from operating activities: Excess (deficiency) of revenues over expenses, fixed asset replacements, refunds and debt service Adjustments to reconcile excess (deficiency) of revenues over expenses, fixed asset replacements, refunds and debt service to net cash provided by (used in) operating activities: Decrease (increase) in accounts receivable (Increase) in utility contributions receivable Increase (decrease) in accounts payable (Decrease) increase in amounts due to other funds Net cash provided by (used in) operating activities Available cash and cash equivalents, beginning of year Available cash and cash equivalents, end of year Supplemental disclosure of cash flows information: Interest paid See accompanying notes to the financial statements. 4 2004 $ (2,013,381) 2,689 (73,492) (25,294) (39,359) (2,148,837) 2,443,835 $294,998 $_ 6,903,400 2003 $ 1,154,318 (2,689) (74,642) 7,189 1,084,176 1,359,659 $_ 2,443,835 Passe ) BRADLEY LAKE Phu JECT MANAGEMENT COMMIT i 2.£ OPERATING AND REVENUE FUNDS NOTES TO FINANCIAL STATEMENTS June 30, 2004 and 2003 NOTE A: SIGNIFICANT ACCOUNTING POLICIES Description of Business: The Bradley Lake Project Management Committee (the Committee) was established pursuant to Section 13 of the Agreement for the Sale and Purchase of Electric Power (Power Sales Agreement) dated December 8, 1987. The purpose of the Committee is to arrange for the operation and maintenance of the Bradley Lake Hydroelectric Project (the Project), which became operational in September 1991, and the scheduling, production and dispatch of power. The members of the Committee include the Alaska Energy Authority (AEA) and the five purchasers under the Power Sales Agreement - Chugach Electric Association, Inc.; Golden Valley Electric Association, Inc.; the Municipality of Anchorage (Municipal Light & Power); the City of Seward (Seward Electric System); and the Alaska Electric Generation & Transmission Cooperative, Inc. (AEG&T). The Homer Electric Association, Inc. (HEA) and the Matanuska Electric Association, Inc. (MEA) are additional parties to the Power Sales Agreement but are included as power purchasers for purposes of representation while AEG&T has no direct vote as a consequence of the individual representation of HEA and MEA. Section 13 of the Power Sales Agreement delineates other Committee responsibilities, including: establishing procedures for each party's water allocation, budgeting for annual Project costs and calculating each party's required contribution to fund annual Project costs. Committee approval of operations and maintenance arrangements for the Project, sufficiency of the annual budgets and wholesale power rates and the undertaking of optional Project work requires a majority affirmative vote and the affirmative vote of AEA. The Power Sales Agreement extends until the later of: 1) 50 years after commencement of commercial operation or 2) the complete retirement of bonds outstanding under the AEA Power Revenue Bond Resolution along with the satisfaction of all other payment obligations under the Power Sales Agreement. Renewal options for additional terms exist. Establishment of Trust Funds: Article V, Section 502 of the Alaska Energy Authority's Power Revenue Bond Resolution established a Revenue Fund and an Operating Fund, including an Operating Reserve account, to be held by AEA. In actuality these funds, along with the Debt Service, Excess Investment Earnings (arbitrage), and various construction funds related to the Bradley Lake Hydroelectric Project are all held by the Corporate Trust Department of US Bank in Seattle, Washington. ( , BRADLEY LAKE PROJECT MANAGEMENT COMMI1 1 EE OPERATING AND REVENUE FUNDS NOTES TO FINANCIAL STATEMENTS (Continued) June 30, 2004 and 2003 NOTE A: SIGNIFICANT ACCOUNTING POLICIES (Continued) All deposits, including utility contributions and interest transferred from other funds, are made into the Revenue Fund, which transfers amounts approximately equal to one-twelfth of the annual operating and maintenance budget into the Operating Fund on a monthly basis. Additional transfers are made from the Revenue Fund to the Debt Service Fund in order to satisfy semiannual interest payments and annual principal payments on the Project's outstanding bonds payable. Interest earnings available for operations and maintenance are derived from the following funds: Debt Service Fund; Operating Reserve Fund; Operating Fund; Revenue Fund; Capital Reserve Fund; and the Renewal & Contingency Fund when the fund balance is greater than $5,000,000. Revenue and Expense Recognition: Utility contributions are recognized as revenue when due to be received under the terms of the Power Sales Agreement. Transfers from other funds are recognized when the transfer is made and interest earnings are recognized when received. Operating and maintenance expenses are recognized when incurred, while interest and principal transfers to Debt Service Fund are recognized when the transfer is made. Purchases of fixed asset replacements are expensed when purchased. Estimates: The preparation of the special-purpose financial statements of the Operating and Revenue Funds requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Income Taxes: The Bradley Lake Project Management Committee is exempt from income taxation under Section 501 (a) of the Internal Revenue Code. NOTE B: INVESTMENTS Substantially all of the balances in the following funds are invested in collateralized investment agreements through the trust department of US Bank. The specified interest rate for monies from the Operating and Revenue Funds invested in the agreements is 7.38% per annum. Balances at June 30, 2004 and 2003 are as follows: 2004 2003 Operating Fund $ 294,998 $ 684,300 Revenue Fund - 1,759,535 Total investments $ 294,998 $2,443,835 - m4 BRADLEY LAKE Pp JECT MANAGEMENT COMMI}1 . wE OPERATING AND REVENUE FUNDS NOTES TO FINANCIAL STATEMENTS (Continued) June 30, 2004 and 2003 NOTE B: INVESTMENTS (Continued) Investments are sold as needed to cover operating requisitions submitted to the trustee and are therefore considered to be short-term and available for sale. Investments are presented at aggregate cost, which approximates market value. For purposes of the cash flow statements, management considers the full amount of the investment balance to be cash available for operations. NOTE C: MAJOR CONTRACTS AND AGREEMENTS During May 1994, the Alaska Energy Authority entered into the Master Maintenance and Operating agreement with the Committee. The purpose of the agreement is to establish contract administration and budgeting procedures for maintenance and operation contracts of the Bradley Lake Hydroelectric Project and to provide for the lease or other use of facilities and equipment in a manner consistent with the requirements of the Power Sales Agreement. The term of the Master Agreement is indefinite, remaining in effect until termination of the Power Sales Agreement or until AEA no longer legally exists. This agreement authorizes AEA to enter into any contracts necessary to perform operating or maintenance-type services to the Project, subject to the approval of the Committee. On behalf of the Committee, the AEA entered into an agreement with Chugach Electric Association, Inc. (CEA) in August, 1996, for the provision of all services necessary to dispatch the Bradley Project's electric power output. The dispatch agreement runs concurrently with the wheeling and related services contract entered into by and among the parties to the Power Sales Agreement in December 1987 and remains in effect for the term of the wheeling agreement unless CEA ceases to be the output dispatcher. In August 1996, the Alaska Energy Authority entered into an agreement with CEA on behalf of the Committee for the provision of maintenance services for the Daves Creek and Soldotna SVC Substations. e@- BRADLEY LAKE PKOJECT MANAGEMENT COMMI1 1 hE OPERATING AND REVENUE FUNDS NOTES TO FINANCIAL STATEMENTS (Continued) June 30, 2004 and 2003 NOTE C: MAJOR CONTRACTS AND AGREEMENTS (Continued) An operation and maintenance agreement dated February 11, 1994, was executed between Homer Electric Association, Inc. and the Alaska Energy Authority. This agreement provides for the operation and maintenance of the Bradley Lake Hydroelectric Project by Homer Electric Association, Inc. The agreement is through June 30, 2004 and continues from year to year thereafter, except upon written notice to terminate by either party. Notice of termination must be given one year in advance of the termination date. HEA is to be reimbursed for costs associated with the operation, maintenance and repair of the Project as determined in advance through the submission of an annual budget based upon prudent estimates and anticipated operation and maintenance costs. In August, 1996, the agreement was amended to separate the maintenance of the transmission facilities from the hydroelectric project. The transmission agreement continues from year to year, except upon written notice to terminate by either party. Notice of termination must be given six months in advance of termination dates. In June, 1999 the agreement was again amended to require HEA to provide communication services in addition to the other services. NOTE D: RELATED PARTY TRANSACTIONS During the years ended June 30, 2004 and 2003, costs incurred under the various contracts with related parties described in Note C were as follows: 2004 2003 Homer Electric Association, Inc. — operation, maintenance and communications $ 1,759,890 $ 1,133,789 Chugach Electric Association, Inc. — substation service maintenance $ 57,090 $ 41,634 For the years ended June 30, 2004 and 2003, Chugach Electric Association, Inc. provided dispatch services to the Committee at the agreed upon amount which is zero. 5 7 BRADLEY LAKE P... JECT MANAGEMENT COMMIT E OPERATING AND REVENUE FUNDS NOTES TO FINANCIAL STATEMENTS (Continued) June 30, 2004 and 2003 NOTE E: SURPLUS REFUND AND UTILITY CONTRIBUTIONS RECEIVABLE The $2,013,381 surplus at June 30, 2003 was refunded to member utilities in fiscal year 2004 per the Power Sales Agreement and direction of the Bradley Lake Project Management Committee. The $73,492 utility contribution receivable at June 30, 2004 is the cash deficit for fiscal year 2004. The utilities will repay the shortfall in fiscal year 2005 pursuant to the Power Sales Agreement and direction of the Bradley Lake Project Management Committee. @. e ; S GY LBeusena, Stonberg & Company A Professional Corporation Certified Public Accountants 3201 C Street, Suite 405 Anchorage, Alaska 99503 Tel. (907) 563-4547 FAX (907) 561-7683 Independent Auditor’s Report on Additional Information Bradley Lake Project Management Committee Anchorage, Alaska Our report on our audits of the special-purpose financial statements of the Bradley Lake Project Management Committee Operating and Revenue Funds for the years ended June 30, 2004 and 2003 appears on the page preceding the balance sheets. Those audits were conducted for the purpose of forming an opinion on the special-purpose financial statements taken as a whole. The supplemental special-purpose Statements of Expenses are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audits of the special-purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the special- purpose financial statements taken as a whole. CPrcaena) Mromlg - Cpe, APE Parisena, Stromberg & Company, APC Anchorage, Alaska October 22, 2004 ~ BRADLEY LAKE ee MANAGEMENT COMMITTEE OPERATING AND REVENUE FUNDS STATEMENTS OF EXPENSES Years ended June 30, 2004 and 2003 2004 Variance Favorable 2003 Budget Actual (Unfavorable) Actual Expenses: Generation expense: Operation supervision and engineering $ 192,800 §$ 200,289 $ (7,489) $ 146,889 Hydraulic operation 39,900 3,900 36,000 4,705 Electric plant operation 63,800 198,742 (134,942) 171,736 Hydraulic power generation operation 346,646 329,312 17,334 320,086 FERC land use fees 108,000 100,220 7,780 34,628 Structure maintenance 35,300 10,453 24,847 32,442 Reservoir, dam, and waterway maintenance 268,000 300,253 (32,253) 19,142 Electric plant maintenance 368,400 383,748 (15,348) 283,275 Hydraulic plant maintenance 320,600 204,447 116,153 81,286 System control and load dispatching 264,730 315,346 (50,616) 241,372 Substation operation and maintenance 73,000 57,090 15,910 41,634 Overhead line maintenance 20,600 32,316 (11,716) 9,083 Total generation expense 2,101,776 2.136.116 (34.340) 1,386,278 Administrative, general and regulatory expense: Insurance 610,000 677,601 (67,601) 509,488 AEA administrative fee 200,000 200,000 - 200,000 PMC costs 74,500 89,237 (14,737) 46,228 Arbitrage expense 202,711 202,711 - 163,420 Regulatory commission: FERC administrative fees 150,000 44,424 105,576 114,214 FERC licensing 31,500 61,503 (30,003) 15,617 FERC study 64,130 90,909 (26,779) 44,857 Total administrative, general and regulatory expense 1,332,841 1,366,385 (33,544) 1,093,824 Total operations and maintenance expenses, before capital project reimbursement 3,434,617 3,502,501 (67,884) 2,480,102 Capital project reimbursement 487,728 784,572 (296,843) 321,022 Total operations and maintenance expenses 913922345. G4. 287,073 1S (364,728) 7) 12. 11 Agenda Item: 7B Approve FY05 budget changes to increase expenses for oe property valuation and increase for Renewal and Ponnnigney Fund. 4. Agenda Item: 7c Approve June 2005 transfer from the Revenue Fund to the R&C Fund in an amount equal to the lesser of amount budgeted or amount required to bring balance to $5,000,000.00. BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE F/Y 2005 Amended Budget Summary of expense changes from F/Y 2005 original - $75,000 increase for the Bradley Lake Project Appraisal. - $540,401 increase to replenish the “R&C” fund to the $5,000,000 level for runner replacement in subsequent fiscal years. - $15,000 increase for Operating Reserve transfer (required to be 20% of budgeted operating expense). - $3,275 decrease to Debt Service (to equal actual F/Y 2005 amount). - $27,782 increase for Arbitrage Transfer (to equal actual F/Y 2005 amount). Other points - Repays the F/Y 2004 deficit of $73,492. -. Proposes to collect an additional $697,850 over the final 2 months of the fiscal year (27% increase in May and June 2005). BRADLEY LAKE HYDROELECTRIC PROJECT Schedule A AMENDED ORIGINAL INC(DEC) FY03 FY2004_ FY2005 INC(DEC) FY2005 = FROM ACTUALS ACTUALS BUDGET FROM PY BUDGET ORIGINAL REVENUES, EXPENSES & CHANGES IN SURPLUS REVENUES | UTILITY CONTRIBUTIONS- 14,409,226 14,759,083 16,030,046 | 1,270,963 fia] 15,332,200 INTEREST INCOME 1,840,740 1,559,318 1,552,323 (6,995) im] 1,595,262 REPAY PRIOR YEAR DEFICIT 0 0 0 0 0 MISCELLANEOUS INCOME 2,680 0 0 0 0 16,252,646 16,318,401 17,582,369 | 1,263,968 [gy] 16,927,462 EXPENSES OPERATIONS 2,316,682 3,299,790 3,284,811] (14,979) 3,209,814 RENEWALS/REPLACEMENTS (R&C FUND REPAYMENT! 321,021 493,525 1,581,725] 1,088,200 1,041,324 REPLACE TRANSMISSION RELAYS 200,000} — 200,000 200,000 PURCHASE NEW VEHICLE 29,130 11,067 of} (11,067) 0 TRANSFER TO OPERATING RESERVE 0 111,400 15,000} (96,400) 4 0 DEBT SERVICE (net of Capital Reserve Reductions) 12,268,075 12,273,400 12,273,050 (350) fe] 12,276,325 ARBITRAGE TRANSFER 163,420 202,711 227,782 25,071 fi} 200,000 PRIOR YEARS SURPLUS (DEFICIT) 2,013,381 (73,492)] (2,086,873) (73,492) 15,098,329 18,405,275 17,508,877 | (896,398) ] 16,653,971 CURRENT YEAR SURPLUS (DEFICIT) 1,154,317 (2,086,874 BEGINNING SURPLUS (DEFICIT 859,064 2,013,381 ENDING SURPLUS (DEFICIT) BALANCE SHEET ASSETS REVENUE FUND OPERATING FUND RECEIVABLES LIABILITIES & SURPLUS LIABILITIES SURPLUS (DEFICIT) OTHER INFORMATION OPERATING RESERVE * MONTHLY CONTRIBUTIONS * Required to be 20% of budgeted operating expense 3/16/20058:30 AMH:\ALL\Imacmillan\BradleyLake\F YOSBRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xisSchedule A-Budget Summary 2,013,381 1,759,535 © 684,300 2,689 433,143 2,013,381 535,000 1,200,768 646,400 1,594,243 661,400 1,335,837 BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B = 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET SUMMARY (A) HEA Annual Operations & Maintenance 1,062,700 962,284 100,416 1,216,500 1,198,460 1,166,649 (B) CEA Dispatch and Substation/SVC Maintenance 68,000 41,634 26,366 73,000 57,090 70,000 (C) Other O&M and Maintenance Projects 446,736 382,361 64,375 812,276 880,566 766,162 (D) Insurance Costs 435,000 509,488 (74,488) 610,000 677,601 725,000 (E) Regulatory Costs 217,500 174,687 42,813 245,630 196,835 182,500 (H) Contingencies 0 0 0 0 0 100,000 2,229,936 2,070,455 159,481 2,957,406 3,010,553 3,010,311 (F) Administrative Costs 244,500 246,228 (1,728) 274,500 289,237 274,500 2,474,436 2,316,682 157,754 | 3,234 ;906 3,299,790 3,284,811 (G) Bond Refunding Costs 0 0 0 0 0 0 2,474,436 2,316,682 157,754 3,231,906 3,299,790 3,284,811 3/16/2005 8:30 AM Page 2 of 9 H:\ALL\Imacmillan\BradleyLake\FY 05BRADLEY\2005BradleyBdgt-0O3MAROSRepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FERC 535 - Operation Supervision & Engineering (A) HEA O&M Contract (C) HEA On-Site Civil Project Manager (C) HEA Digitize & Control Project Drawings FERC 537 - Hydraulic Expenses (A) HEA O&M Contract FERC 538 - Electric Expenses (A) HEA O&M Contract (A) SOA BOILIER INSPECTION (A) HEA O&M Contract (C) Replace Two Way Radios (C) DIS Voice/Data Circuits (inc. space & power) (C) DIS 2-way Radio Circuits & radio maint. (C) HEA Circuits and Radio - To Bernice Lake (C) CEA Circuits -Bernice Lake to Anchorage FERC 539 - Misc. Hydraulic Power Generation Expenses FERC 540 - Rents (C) Bradley Lake FERC land use fees (5% increase bu FERC 542 - Maintenance of Structures (A) HEA O&M Contract (C) Other (A) . HEA O&M Contract (C) Bradley Lake Dam Repair (C) Nuka Diversion (C) Middle Fork Diversion FERC 543 - Maintenance of Reservoirs, Dams & Waterways 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET 94,200 146,889 (52,689) 192,800 130,716 122,828 0 0 23,732 0 0 45,840 [ 94,200 146,889 (52,689) 192,800 200,289 122,828 19,600 4,705 14,895 39,900 3,900 35,730 19,600 4,705 14,895 39,900 3,900 35,730 | 354,100 171,736 182,364 63,800 197,032 99,365 0 0 1,710 0 354,100 171,736 182,364 63,800 198,742 99,365 148,100 201,340 (53,240) 210,900 210,566 234,321 0 0 10,000 10,000 0 10,000 10,000 0 0 7,000 0 7,000 7,000 0 0 90,000 90,000 0 90,000 90,000 90,000 28,746 28,746 0 28,746 28,746 28,746 283,846 320,086 (36,240)] 346,646 329,312 363,067 76,000 34,628 41,372 108,000 100,220 74,000 L 76,000 34,628 41,372 108,000 100,220 74,000 39,000 32,442 6,558 35,300 10,453 19,278 0 0 0 0 0 0 39,000 32,442 6,558 35,300 10,453 19,278 | 5,100 19,142 (14,042) 62,000 2,235 10,278 160,000 152,640 ) 125,134 0 0 20,000 0 15,000 3/16/2005 8:30 AM Page 3 of 9 H:\ALL\lmacmillan\BradleyLake\FYO5BRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B (C) Kachemak Creek Gauging Station (C) Other O&M FERC 544 - Maintenance of Electric Plant (A) HEA O&M Contract (A) HEA O&M Contract-Runner Repairs FERC 545 - Maintenance of Misc. Hydraulic Plant (A) HEA O&M Contract (C) Martin River Road Study-Amendment & Removal FERC 556 - System Control & Load Dispatching (A) HEA O&M Contract (C) NOAA Weather Service (C) SCS Snow Measurement (C) UAA Seismic monitoring and reporting (C) USGS Streamguaging (C) State of Alaska Permits FERC 562 - Station Expenses (B) CEA SVC/Substation Maintenance Contract (C) SVC Condition Assessment/Staff Training FERC 571 - Maintenance of Overhead Lines (A) HEA Overhead Line Maintenance (H) Contingencies FERC 920 - Administrative Expense (F) AEA Admin Fee AEA Administrative Costs Page 4 of 9 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL = VARIANCE BUDGET YTD ACTUAL BUDGET 0 0 26,000 0 26,000 20,244 5,100 19,142 (14,042) 268,000 300,253 51,278 284,000 283,275 725 368,400 342,669 276,741 0 0 41,080 0 284,000 283,275 725 366,400 383,749 276,741 92,000 81,286 10,714 210,600 153,066 282,169 0 0 0 110,000 51,382 30,000 92,000 81,286 10,714 320,600 204,447 312,169 6,000 12,384 (6,384) 12,200 74,428 23,315 7,040 0 7,040 7,040 0 0 29,450 30,673 (1,223) 41,990 38,278 30,000 56,500 56,500 0 56,500 56,500 56,500 142,000 141,690 310 147,000 146,040 205,916 0 125 (125) 0 100 0 240,990 241,372 (382) 264,730 315,346 315,731 68,000 41,634 26,366 73,000 57,090 70,000 0 0 200,000 68,000 41,634 26,366 73,000 57,090 270,000 62,624 62,624 100,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 a 200,000 | /16/2005 8:30 AM H:\ALL\Imacmillan\BradleyLake\FYOSBRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET PMC Costs (F) Bradley Lake Audit fees 8,500 6,540 1,960 8,500 7,898 8,500 (F) Bradley Lake PMC Legal 10,000 16,093 (6,093) 40,000 57,945 40,000 (F) Bradley Lake PMC JAA Activities 0 0 0 0 0 0 (F) Bradley Lake Arbitrage Report 6,000 6,000 0 6,000 5,800 6,000 (F) Bradley Lake Trustee fees 20,000 17,595 2,406 20,000 17,595 20,000 PMC Costs 44,500 46,228 (1,728) 74,500 89,237 74,500 Bond Refunding Costs Reimburseable costs Refunding Costs 0 0 0 0 0 0 TOTAL FERC 920 244,500 246,228 (1,728) 274,500 289,237 274,500 FERC 924 - Property Insurance (D) Insurance Premiums 405,000 456,729 (51,729) 555,000 547,895 590,000 (D) Homer Electric Insurance 30,000 52,759 (22,759) 30,000 57,972 60,000 (D) Risk Assessment 0 0 0 25,000 71,734 75,000 435,000 509,488 (74,488)} | 610,000 677,601 725,000 FERC 928 - Regulatory Commission Expenses (E) FERC administrative fees 106,000 114,214 (8,214) 150,000 44,424 126,000 (E) FERC Instrumentation Data Collection 26,812 (26,812) 57,687 (E) Seismic Survey Spillway 0 0 18,771 (E) Contractual Engineer - FERC license issues 31,500 15,617 15,883 31,500 3,816 31,500 (E) Spillway Seepage Water and Pressure Study 80,000 18,043 61,957 64,130 72,137 25,000 ; 217,500 174,687 42,813 245,630 196,835 182,500 TOTAL BRADLEY LAKE BUDGET 2,474,436 2,316,682 157,754 3,231,906 3,299,790 3,284,811 3/16/2005 8:30 AM Page 5 of 9 H:\ALL\lmacmillan\BradleyLake\F YOS5BRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE MONTHLY UTILITY CONTRIBUTION SCHEDULE C PERCENT FY2003 FY2004 FY2005 FY2005 POWER PURCHASER SHARE TOTAL TOTAL TOTAL INCREASE CHUGACH ELECTRIC 30.4% 4,380,398 4,509,110 4,873,142 364,032 MUNICIPALITY OF ANCHORAGE 25.9% 3,731,990 3,841,634 4,151,784 310,150 AEG&T 25.8% 3,717,578 3,826,802 4,135,752 308,950 GOLDEN VALLEY ELECTRIC 16.9% 2,435,162 2,506,706 2,709,072 202,366 CITY OF SEWARD 1.0% 144,098 148,322 160,296 11,974 100.0% _ 14,409,226 14,832,574 16,030,046 |__ 1,197,472 FY2003 FY2004 PERCENT MONTHLY MONTHLY POWER PURCHASER SHARE AVERAGE AVERAGE CHUGACH ELECTRIC 30.4% 365,033 375,759 MUNICIPALITY OF ANCHORAGE 25.9% 310,999 320,136 AEG&T 25.8% 309,798 318,900 GOLDEN VALLEY ELECTRIC 16.9% 202,930 208,892 CITY OF SEWARD 1.0% 12,008 12,360 FY2005 MONTHLY 406,094 345,982 344,646 225,756 13,358 FY2005 INCREASE 30,335 25,846 25,746 16,864 998 No. of Months 100.0% 1,200,768 1,236,047 COMPONENTS OF CHANGE IN CONTRIBUTION FY2004 ANNUAL CONTRIBUTION Revenue Changes (INCREASE) DECREASE IN BUDGETED INTEREST EARNINGS Expenditure Changes INCREASE (DECREASE) IN BUDGETED O&M COSTS INCREASE (DECREASE) IN PAYBACK TO R&C FUND INCREASE (DECREASE) TRANSMISSION RELAYS REPLACEMENTS INCREASE (DECREASE) VEHICLE PURCHASE INCREASE (DECREASE) IN DEBT SERVICE INCREASE (DECREASE) IN EXCESS EARNINGS TRANSFER INCREASE (DECREASE) IN OPERATING RESERVE TRANSFER Other IMMATERIAL ROUNDING DIFFERENCES NET INCREASE(DECREASE) FY2005 ANNUAL CONTRIBUTION , 1,335,836 Revised 14,832,574 6,995 (14,979) 1,088,200 200,000 (11,067) (350) 25,071 (96,400) 2 1,197,472 16,030,046 0 10 2 12 FYO5PAID FY0S5TOPAY TOTAL ORIGINAL REVISED deficit repay BUDGET BUDGET BUDGET 3,884,160 988,982 4,873,142 22,341.57 3,309,200 842,584 4,151,784 19,034.43 3,296,420 839,332 4,135,752 18,960.94 2,159,280 549,792 2,709,072 12,420.15 127,770 32,526 160,296 734.92 1,197,472 12,776,830 3,253,216 16,030,046 73,492.00 MONTHLY MONTHLY 388,416 494,491 330,920 421,292 329,642 419,666 215,928 274,896 AZ TTT 16,263 1,197,468 99,789 1,277,683 1,626,608 Original 14,759,089 (36,222) (22,092) 553,596 200,000 (11,000) 2,925 (2,711) (111,400) 16 573.112 15,332,201 3/16/20058:30 AM H:\ALL\Imacmillan\BradleyLake\F YOSBRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xlsSchedule C Utility Contrib BRADLEY LAKE R&C FUND DISBURSEMENTS AND REPAYMENTS SCHEDULE D ACTUAL ACTUAL ACTUAL TO REPAY at 06/30/03 668,000.32 20,789.79 196,689.93 77,583.24 Disburse 890,667.09 27,719.72 Description Repay (222,666.77) (6,929.93) 262,253.24 (65,563.31) 103,444.32 (25,861.08) Replace Runners UNDER REIMB [Ending Balance $_1,284,084.37 $ (321,021.09) $ 963,063.28] $ RECAP-GOVERNOR PROJECT REVISED-03/14/05 MONTH CONST FUND R&C FUND TOTAL ACTUAL FY03 0.00 103,444.22 103,444.22 FY04 0.00 132,182.58 132,182.58 ‘otal as of 30June2004 0.00 235,626.80 235,626.80 PROJECTED December-04 510,000.00 0.00 510,000.00 March-04 1,070,784.00 0.00 1,070,784.00 April-0S 119,216.00 119,216.00 June-05 0.00 680,000.00 680,000.00 FY05 Additions 1,700,000.00 680,000.00 2,380,000.00 July-05 0.00 560,000.00 560,000.00 August-0S 0.00 325,000.00 325,000.00 September-05 0.00 475,000.00 475,000.00 FY06 Additions 0.00 1,360,000.00 1,360,000.00 Total Cost of Project 1,700,000.00 2,275,626.80 3,975,626.80 0.00 ACTUAL Disburse 587,046.30 78.76 367.10 132,182.58 719,674.74 = ACTUAL ACTUAL ACTUAL TO REPAY at 06/30/04 $94,571.27 13,918.93 131,401.95 150,859.10 R&C Interest (291,047.00) Repay (369,428.35) (6,949.62) (65,655.09) (58,906.73) 7,414.39 7,414.39 $ (291,047.00) $ (493,525.39) $ 898,165.63 $_4,101,834.37 $_5,000,000.00 $ PROJECTED PROJECTED Disburse Repay (594,571.27) (13,918.93) (131,401.95) 683,559.79 (834,418.89) (7,414.39) 683,559.79 _$ (1,581,725.43 PROJECTED TO REPAY at 06/30/05 PROJECTED Disburse 1,360,000.00 95,888.00 $ PROJECTED PROJECTED TO REPAY Repay (1,360,000.00) (95,888.00) PROJECTED PROJECTED PROJECTED TO REPAY Repay at 06/30/07 (2,600,000.00) $_5,000,000.00 $_5,000,000.00 | 3/16/20058:30 AM H:\ALL\imacmillan\BradleyLake\FYOS5BRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xisSchedule D R&C Disb & Repay BRADLEY LAKE BUDGET ACTIVITY BY ACCOUNT SCHEDULE G Rev Fund O&M Fund Debt Fund Op Reserve R&C Cap Reserve Total 6/30/2003 Actual Balance 1,759,535 684,300 8,676,539 535,000 4,036,938 12,834,000 _ 28,526,312 a (0) 23% of Annual O&M Budget FY2004 Budget - Revenues 14,759,083 14,759,083 Interest 1,559,259 60 291,047 1,850,365 Transfers to O&M (3,351,579) 3,351,579 - - Transfers to Debt Service (12,273,400) 12,273,400 - Transfers to Revenue Fund 5,562 (5,562) - Payback of R&C Fund (242,368) (251,157) 493,524 - FY03 O&M Requisitions (61,965) (61,965) FY04 O&M Requisitions (3,299,790) - (3,299,790) Renewals/Replacements - (719,675) - (719,675) To Excess Earnings fund (202,711) (202,711) Snowmachines (11,067) (11,067) Refund of prior year surplus (2,013,381) (2,013,381) Debt Payments (20,949,939) (20,949,939) Increase Op Reserve (111,400) 111,400 : 6/30/2004 Actual Balance (0) 294,998 0 646,400 4,101,834 12,834,000 17,877,232 A 20.001% of Annual O&M Budget FY2005 Budget = Revenues 16,030,046 - 16,030,046 Interest 1,552,323 1,552,323 Transfer back interest - - Transfers to O&M (3,284,811) 3,284,811 - - Transfers to Debt Service (12,273,050) 12,273,050 - Payback of R&C Fund (1,581,725) 1,581,725 - 2004 O&M Requisitions (368,490) (368,490) 2005 O&M Requisitions (3,284,811) (3,284,811) 2005 Capital Requistions (200,000) 200,000 - - Renewals/Replacements (200,000) - (683,560) - (883,560) To Excess Earnings fund (227,782) (227,782) Payment of Prior Year Deficit 73,492 73,492 Debt Payments (12,273,050) (12,273,050) Increase Op Reserve (15,000) 15,000 - 6/30/2005 Projected Balance 0 (0) 0 661,400 5,000,000 12,834,000 18,495,401 Assumption: in For purpose of budget cash flows, July 01 debt service should be 20.00% of Annual O&M Budget is assumed to be disbursed on June 30 projected 20.14% 3/16/20058:30 AM H:\ALL\Imacmillan\BradleyLake\FYOSBRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule G-Cash balances PROJECTED INTEREST INCOME SCHEDULE! TOTAL Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 OTHER ADJ Beginning Balance 17,877,232.00 17,877,232.00 19,855,200.66 20,933,048.73 21,367,800.96 22,319,983.25 23,597,807.17 24,739,520.55 23,163,988.26 24,065,636.38 24,967,284.50 25,668,932.61 26,992,997.73 27,563,570.85 Receipts Utility Contributions 16,030,046.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,626,608.00 1,626,608.00 Interest Income Received 1,552,323.45 928,065.00 175.46 47.02 53.14 140.72 120.04 722,867.22 0.00 0.00 0.00 0.00 0.00 (99,145.15) ADJ INT TO Repay Prior Year Deficit 73,492.00 73,492.00 ACCRUED 17,655,861.45 2,205,748.00 1,277,858.46 1,277,730.02 1,277,736.14 1,277,823.72 1,277,803.04 2,000,550.22 1,277,683.00 1,277,683.00 1,277,683.00 1,700,100.00 1,626,608.00 (99,145.15) Disbursements Ending Cash in O&M Fund (368,490.00) 2.22 (200,010.39) (168,481.83) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 O & M Expenses (3,284,811.40) 0.00 0.00 (670,936.17) (325,553.85) 0.20 (136,089.66) (272,057.51) (376,034.88) (376,034.88) (376,034.88) (376,034.88) (376,034.88) R&C Fund Disbursement (683,559.79) (3,559.79) 0.00 (680,000.00) Debt Service Payment (12,273,050.00) (3,304,025.00) (8,969,025.00) ASSUME LOAN Capital Requisitions (200,000.00) (200,000.00) PD JUNE 30 Excess Earnings Transfer (227,781.56) (227,781.56) Other Adjustment-Equal Sch G 0.00 (17,037,692.75) (227,779.34) (200,010.39) (842,977.79) (325,553.85) 0.20 (136,089.66) _(3,576,082.51) (376,034.88) (376,034.88) (576,034.88) (376,034.88) _(1,056,034.88) _(8,969,025.00) Adjust to Actual 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Ending Balance 18,495,400.70 19,855,200.66 _20,933,048.73 — 21,367,800.96 22,319,983.25 23,597,807.17 24,739,520.55 23,163,988.26 24,065,636.38 _24,967,284.50 25,668,932.61 26,992,997.73 27,563,570.85 18,495,400.70 Interest Income Projection Estimated Accrued Interest 1,552,323.45 108,210.84 113,910.67 116,276.45 121,457.91 128,411.40 134,624.22 126,050.70 130,957.17 135,863.64 139,681.77 146,886.90 149,991.76 Adjust to Actual Received (24.28) 1,552,323.45 108,210.84 113,910.67 116,276.45 121,457.91 128,411.40 134,599.94 126,050.70 130,957.17 135,863.64 139,681.77 146,886.90 149,991.76 0.00 = Payment of Accrued Interest 722,867.22 Actual Balance per Statements 19,855,200.66 _20,933,048.73__21,367,800.96 22,319,983.25 23,597,807.17 24,739,520.55 23,163,988.26 18,495,400.44 Difference 0.00 0.00 0.00 0.00 0.00 0.00 0.00 (24,065,636.38) (24,967,284.50) (25,668,932.61) (26,992,997.73) (27,563,570.85) (0.26) Agenda Item: 7D Adu? Grp Approve FY06 budget. +A pwerdl puclgal ign oF 50, +. THA oy pe ote ae for As som fon gf The. pried " Move: —sbredh frre ae = fps ap AA pow foc Guhl At Jie poe AEA men ( “Ot [tin Farls BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE F/Y 2006 Proposed Budget Summary of expense changes from F/Y 2005 amended - $273,885 (8.3%) decrease in operating expenses primarily due to no recurring cost for SVC training and project valuation. - $549,163 increase in R&C fund repayment for increased fund expenditures in F/Y 06 (see Schedule D for detail). - $200,000 decrease for transmission relay replacements (project to be completed by end of F/Y 05). - $3,275 increase for debt service based on repayment schedule. - $2,782 decrease in arbitrage transfer. - $15,000 decrease for operating fund transfer (due to no operating budget increase). Other points - R&C fund expenditures (Schedule D) includes $400,000 for a pending change order on the governor project. - Other expenditures assume that SVC training, transmission relay replacements, and project valuations will be completed in F/Y 05. BRADLEY LAKE HYDROELECTRIC PROJECT Schedule A AMENDED FY03 FY04 FY2005 FY2006 INC(DEC) ACTUALS ACTUALS BUDGET BUDGET FROM PY REVENUES, EXPENSES & CHANGES IN SURPLUS REVENUES UTILITY CONTRIBUTIONS 14,409,226 14,759,083 16,030,046 16,125,172 95,126 INTEREST INCOME 1,840,740 1,850,365 1,552,323 1,517,966 (34,357) SALE OF VEHICLE 0 0 0 0 0 MISCELLANEOUS INCOME 2,680 0 0 0 0 16,252,646 16,609,448 17,582,369 17,643,138 60,769 | EXPENSES OPERATIONS 2,316,682 3,299,790 3,284,811 3,010,926 (273,886) RENEWALS/REPLACEMENTS (R&C FUND REPAYMENT: 321,021 784,571 1,581,725 2,130,888 549,163 REPLACE TRANSMISSION RELAYS 200,000 (200,000) PURCHASE NEW VEHICLE 29,130 11,067 0 0 TRANSFER TO OPERATING RESERVE 0 111,400 15,000 (15,000) DEBT SERVICE (net of Capital Reserve Reductions) 12,268,075 12,273,400 12,273,050 12,276,325 3,275 ARBITRAGE TRANSFER 163,420 202,711 227,782 225,000 (2,782) REFUND OF PRIOR YEARS SURPLUS 2,013,381 (73,492 0 73,492 15,098,329 18,696,321 17,508,876 17,643,139 134,262 CURRENT YEAR SURPLUS (DEFICIT) 1,154,317 (2,086,873) 73,493 BEGINNING SURPLUS 859,063 2,013,380 (73,492 ENDING SURPLUS (DEFICIT) 2,013,380 (73,492) 0 BALANCE SHEET ASSETS REVENUE FUND 1,759,535 (0) OPERATING FUND 684,300 294,998 RECEIVABLES 2,689 - 2,446,524 294,997 LIABILITIES & SURPLUS LIABILITIES 433,143 368,489 SURPLUS 2,013,381 (73,492) 2,446,524 294,997 OTHER INFORMATION OPERATING RESERVE * 535,000 646,400 661,400 661,400 MONTHLY CONTRIBUTIONS 1,200,768 1,594,243 1,374,959 1,343,764 * Required to be 20% of budgeted operating expense 3/16/20058:34 AMH:\ALL\Imacmillan\BradleyLake\F YO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule A-Budget Summary BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET SUMMARY (A) HEA Annual Operations & Maintenance 1,216,500 1,198,460 18,040 1,166,649 625,390 1,226,600 (B) CEA Dispatch and Substation/SVC Maintenance 73,000 57,090 15,910 70,000 67,975 105,200 (C) Other O&M and Maintenance Projects 812,276 880,567 (68,291) 766,162 258,162 522,416 (D) Insurance Costs 610,000 677,601 (67,601) 725,000 572,587 616,209 (E) Regulatory Costs 245,630 196,835 48,795 182,500 53,520 166,000 (H) Contingencies 0 0 0 100,000 0 100,000 2,957,406 3,010,553 (53,147) 3,010,311 1,577,634 2,736,426 (F) Administrative Costs 274,500 289,237 (14,737) 274,500 233,765 274,500 3,231,906 3,299,790 (67,884) 3,284,811 1,811,399 3,010,926 (G) Bond Refunding Costs 0 0 0 0 0 0 3,231,906 3,299,790 (67,884) 3,284,811 1,811 399 | L__ 3,010,926 3/16/2005 8:34 AM Page 2 of 9 H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET FERC 535 - Operation Supervision & Engineering (A) HEA O&M Contract 192,800 130,716 62,084 122,828 72,767 184,100 (C) HEA On-Site Civil Project Manager 23,732 (23,732) 0 (C) HEA Digitize & Control Project Drawings 45,840 (45,840) 0 192,800 200,289 (7,489) 122,828 72,767 L 184,100 FERC 537 - Hydraulic Expenses (A) HEA O&M Contract 39,900 3,900 36,000 35,730 3,950 58,300 39,900 3,900 36,000 35,730 3,950 58,300 FERC 538 - Electric Expenses : (A) HEA O&M Contract 63,800 197,032 (133,232) 99,365 97,891 94,200 (C) SOA BOILIER INSPECTION 0 1,710 (1,710) 0 0 0 63,800 198,742 (134,942) 99,365 97,891 94,200 FERC 539 - Misc. Hydraulic Power Generation Expenses (A) HEA O&M Contract 210,900 210,566 334 234,321 104,034 253,100 (C) Replace Two Way Radios 0 10,000 0 10,000 (C) DIS Voice/Data Circuits (inc. space & power) 10,000 0 10,000 0 0 0 (C) DIS 2-way Radio Circuits & radio maint. 7,000 0 7,000 0 0 0 (C) HEA Circuits and Radio - To Bernice Lake 90,000 90,000 0 90,000 45,000 90,000 (C) CEA Circuits -Bernice Lake to Anchorage 28,746 28,746 0 28,746 14,373 0 346,646 329,312 17,334 363,067 163,407 353,100 FERC 540 - Rents (C) Bradley Lake FERC land use fees (5% increase bu 108,000 100,220 7,780 74,000 66,115 74,000 108,000 100,220 7,780 74,000 66,115 74,000 FERC 542 - Maintenance of Structures (A) HEA O&M Contract 35,300 10,453 24,847 19,278 28,331 53,500 (C) Other 0 0 0 0 0 0 35,300 10,453 24,847 19,278 28,331 53,500 FERC 543 - Maintenance of Reservoirs, Dams & Waterways (A) HEA O&M Contract 62,000 2,235 59,765 10,278 0 15,400 (C) Bradley Lake Dam Repair 160,000 152,640 7,360 0 0 0 (C) Nuka Diversion 125,134 (125,134) 0 (C) Middle Fork Diversion 20,000 20,245 (245) 15,000 0 0 3/16/2005 8:34 AM Page 3 of 9 H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xIsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET (C) Kachemak Creek Gauging Station 26,000 0 26,000 26,000 0 26,000 (C) Other O&M 0 0 0 268,000 300,253 (32,253) 51,278 0 41,400 FERC 544 - Maintenance of Electric Plant (A) HEA O&M Contract 368,400 342,669 25,731 276,741 216,138 295,000 (A) HEA O&M Contract-Runner Repairs 0 41,080 (41,080) 0 0 0 368,400 383,748 (15,348) 276,741 216,138 295,000 FERC 545 - Maintenance of Misc. Hydraulic Plant (A) HEA O&M Contract 210,600 153,066 57,534 282,169 81,200 264,000 (C) Martin River Road Study-Amendment & Removal 110,000 51,382 58,618 30,000 15,923 30,000 320,600 204,447 116,153 312,169 97,123 294,000 FERC 556 - System Control & Load Dispatching (A) HEA O&M Contract 12,200 74,428 (62,228) 23,315 14,289 9,000 (C) NOAA Weather Service 7,040 0 7,040 0 0 0 (C) SCS Snow Measurement 41,990 38,278 3,712 30,000 (8,482) 30,000 (C) UAA Seismic monitoring and reporting 56,500 56,500 0 56,500 30,845 56,500 (C) USGS Streamguaging 147,000 146,040 960 205,916 57,727 205,916 (C) State of Alaska Permits 0 100 (100) 0 100 0 264,730 315,346 (50,616) 315,731 94,480 301,416 FERC 562 - Station Expenses (B) CEA SVC/Substation Maintenance Contract 73,000 57,090 15,910 70,000 67,975 105,200 (C) SVC Condition Assessment/Staff Training 0 200,000 36,561 0 73,000 57,090 15,910 270,000 104,536 105,200 FERC 571 - Maintenance of Overhead Lines (A) HEA Overhead Line Maintenance 20,600 32,316 (11,716) 62,624 6,788 0 20,600 32,316 (11,716) 62,624 6,788 0 (H) Contingencies 0 0 0 100,000 0 100,000 FERC 920 - Administrative Expense (F) AEA Admin Fee 200,000 200,000 0 200,000 200,000 200,000 AEA Administrative Costs 200,000 200,000 0 200,000 200,000 200,000 | 3/16/2005 8:34 AM Page 4 of 9 H:\ALL\lmacmillan\BradleyLake\F YO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET PMC Costs (F) Bradley Lake Audit fees 8,500 7,898 602 8,500 8,100 8,500 (F) Bradley Lake PMC Legal 40,000 57,945 (17,945) 40,000 2,845 40,000 (F) Bradley Lake Arbitrage Report 6,000 5,800 200 6,000 5,225 6,000 (F) Bradley Lake Trustee fees 20,000 17,595 2,406 20,000 17,595 20,000 (F) PMC Costs 74,500 89,237 (14,737) 74,500 33,765 74,500 Bond Refunding Costs Reimburseable costs Refunding Costs 0 0 0 0 0 0 TOTAL FERC 920 274,500 289,237 (14,737) 274,500 233,765 274,500 FERC Insurance Premiums 555,000 547,895 7,105 590,000 529,723 556,209 (D) Homer Electric Insurance 30,000 57,972 (27,972) 60,000 28,352 60,000 (D) Risk Assessment 25,000 71,734 (46,734) 75,000 14,512 0 (D) 610,000 677,601 (67,601) 725,000 572,587 616,209 FERC FERC administrative fees 150,000 44,424 105,576 126,000 0 126,000 (E) FERC Instrumentation Data Collection 57,687 (57,687) 0 (E) Seismic Survey Spillway 18,771 (18,771) 0 (E) Contractual Engineer - FERC license issues 31,500 3,816 27,684 31,500 45,974 40,000 (E) Spillway Seepage Water and Pressure Study 64,130 72,137 (8,007) 25,000 7,546 0 (E) 245,630 196,835 48,795 182,500 53,520 166,000 3,231,906 3,299,790 (67,884) 3,284,811 1,811,399 3,010,926 TOTAL BRADLEY LAKE BUDGET 3/16/2005 8:34 AM Page 5 of 9 H:\ALL\lmacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE MONTHLY UTILITY CONTRIBUTION SCHEDULE C POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC. CITY OF SEWARD POWER PURCHASER AMENDED ACTUAL BUDGET BUDGET PERCENT FY2004 FY2005 FY2006 FY2006 SHARE TOTAL TOTAL TOTAL DECREASE 30.4% 4,509,110 5,015,846 4,902,050 (113,796) 25.9% 3,841,634 4,273,370 4,176,420 (96,950) 25.8% 3,826,802 4,256,870 4,160,292 (96,578) 16.9% 2,506,706 2,788,418 2,725,152 (63,266) 1.0% 148,322 165,002 161,256 (3,746) 100.0% _ 14,832,574 16,499,506 16,125,170 374,336) AMENDED FY2004 FY2005 PERCENT MONTHLY MONTHLY FY2006 FY2006 SHARE AVERAGE AVERAGE MONTHLY | DECREASE CHUGACH ELECTRIC 30.4% 375,759 417,987 408,504 (9,483) MUNICIPALITY OF ANCHORAGE 25.9% 320,136 356,114 348,035 (8,079) AEG&T 25.8% 318,900 354,739 346,691 (8,048) GOLDEN VALLEY ELECTRIC 16.9% 208,892 232,368 227,096 (5,272) CITY OF SEWARD 1.0% 12,360 13,750 13,438 (312) 100.0% 1,236,047 1,374,958 31,194 COMPONENTS OF CHANGE IN CONTRIBUTION FY2005 ANNUAL CONTRIBUTION 16,030,046 Revenue Changes (INCREASE) DECREASE IN BUDGETED INTEREST EARNINGS 34,357 Expenditure Changes INCREASE (DECREASE) IN BUDGETED O&M COSTS (273,886) INCREASE (DECREASE) IN PAYBACK TO R&C FUND 549,163 INCREASE (DECREASE) TRANSMISSION RELAYS REPLACEMENTS (200,000) INCREASE (DECREASE) VEHICLE PURCHASE - INCREASE (DECREASE) IN DEBT SERVICE > 3,275 INCREASE (DECREASE) IN EXCESS EARNINGS TRANSFER (2,782) INCREASE (DECREASE) IN OPERATING RESERVE TRANSFER (15,000) Other IMMATERIAL ROUNDING DIFFERENCES = NET INCREASE(DECREASE) 95,127 FY2006 ANNUAL CONTRIBUTION 16,125,173 (1) 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule C Utility Contrib BRADLEY LAKE R&C FUND DISBURSEMENTS AND REPAYMENTS SCHEDULE D Description Replace cable from dam to power house ‘ACTUAL Disburse 890,667.09 27,719.72 262,253.24 103,444.32 Replace power system stabilizer Replace two RTUs R REIMB \ctsumy Balance ACTUAL Repay (222,666.77) (6,929.93) (65,563.31) (25,861.08) ACTUAL TO REPAY at 06/30/03 668,000.32 20,789.79 196,689.93 77,583.24 ACTUAL Disburse 587,046.30 78.76 367.10 132,182.58 ACTUAL R&C Interest (291,047.00) ACTUAL Repay (369,428.35) (6,949.62) (65,655.09) (58,906.73) ‘ACTUAL TO REPAY at 06/30/04 594,571.27 13,918.93 131,401.95, 150,859.10 7,414.39 PROJECTED Disburse PROJECTED Repay (594,571.27) (13,918.93) (131,401.95) (834,418.89) (7,414.39) PROJECTED TO REPAY at 06/30/05 PROJECTED Disburse 1,360,000.00 95,888.00 400,000.00 200,000.00 75,000.00 PROJECTED PROJECTED TO REPAY at 06/30/06 PROJECTED PROJECTED PROJECTED TOREPAY Disburse at 06/30/07 Repay Repay (1,360,000.00) (95,888.00) (400,000.00) (200,000.00) (75,000.00) 2,600,000.00 (2,600,000.00) PROJECTED Disburse PROJECTED PROJECTED TO REPAY Repay at 06/30/07 Balance in R&C Fund at June 30 RECAP-GOVERNOR PROJECT REVISED-03/15/05 MONTH CONST FUND ACTUAL FY03 0.00 Fyo4 0.00 ‘otal as of 30June2004 (0.00 PROJECTED December-04 510,000.00 March-04 1,070,784.00 April-oS 119,216.00 May-05 0.00 May-05, FY0S Additions July-05 0.00 July-05 0.00 September-05 0.00 Y06 Additions 0.00 Dost of Project 1,700,000.00 R&C FUND 103,444.22 132,182.58 235,626.80 0.00 0.00 0.00 0.00 560,000.00 325,000.00 1,360,000.00 2,275,626.80 41,284,084.37 _$ (321,021.09) $ 963,063.28 | $ TOTAL 103,444.22 132,182.58 235,626.80 510,000.00 1,070,784.00 119,216.00 0.00 ‘560,000.00 325,000.00 475,000.00 ({inicuded pending change order) 1,360,000.00 3,975,626.80 0.00 719,674.74] S_(291,047.00) $ (493,525.39) $898,165.63 $_4,101,834.37 $ 683,559.79 _$ S_(2,130,888.00) $ $ _2,600,000.00_$ _(2,600,000.00)_$ 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\F YO6BRADLE Y\2006BradleyBdgt-DRAFT.xlsSchedule D R&C Disb & Repay BRADLEY LAKE BUDGET ACTIVITY BY ACCOUNT SCHEDULE G Rev Fund O&M Fund Debt Fund Op Reserve R&C Cap Reserve Total 6/30/2004 Actual Balance (0) 294,998 : 646,400 4,101,835 12,834,000 17,877,232 a 20.001% of Annual O&M Budget FY2005 Budget-Revised - Revenues 16,030,046 - 16,030,046 Interest 1,552,323 1,552,323 Transfer back interest - - Transfers to O&M (3,284,811) 3,284,811 - = Transfers to Debt Service (12,273,050) 12,273,050 - Payback of R&C Fund (1,581,725) 1,581,725 - 2004 O&M Requisitions (368,490) (368,490) 2005 O&M Requisitions (3,284,811) (3,284,811) 2005 Capital Requistions (200,000) 200,000 - : Renewals/Replacements (200,000) - (683,560) - (883,560) To Excess Earnings fund (227,782) (227,782) Payment of Prior Year Deficit 73,492 73,492 Debt Payments (12,273,050) (12,273,050) Increase Op Reserve (15,000) 15,000 - 6/30/2005 Projected Balance 0 (0) - 661,400 5,000,000 12,834,000 18,495,400 A FY2006 Budget 7 Revenues 16,125,172 - 16,125,172 Interest 1,517,966 1,517,966 Transfer back interest - - Transfers to O&M (3,010,926) 3,010,926 - - Transfers to Debt Service (12,276,325) 12,276,325 a Payback of R&C Fund (2,130,888) 2,130,888 - 2005 O&M Requisitions - = 2006 O&M Requisitions (3,010,926) (3,010,926) 2006 Capital Requistions - - - ; Renewals/Replacements - - (2,130,888) - (2,130,888) To Excess Earnings fund (225,000) (225,000) Payment of Prior Year Deficit - T Debt Payments (12,276,325) (12,276,325) Increase Op Reserve : 7 = 6/30/2006 Projected Balance 0 (0) : 661,400 5,000,000 12,834,000 18,495,399 Assumption: should be 20.00% For purpose of budget cash flows, July 01 debt service projected 21.97% is assumed to be disbursed|/on June 30 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule G-Cash balances BRADLEY LAKE BUDGET PROJECTED INTEREST INCOME SCHEDULE | TOTAL Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 OTHER ADJ Beginning Balance 18,495,399.55 18,495,399.55 19,043,043.97 19,874,623.59 20,556,203.21 21,712,782.83 22,869,362.45 23,921,554.07 22,537,448.95 23,694,028.57 24,850,608.19 25,332,187.82 26,488,767.44 27,645,347.06 Receipts Utility Contributions 16,125,172.00 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 ADJ INTEREST Interest Income Received 1,517,966.47 932,273.80 697,477.76 0.00 0.00 0.00 0.00 0.00 (111,785.09) TO ACCRUAL BASIS Repay Prior Year Deficit 0.00 0.00 17,643,138.47 2,276,038.13 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 2,041,242.09 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 (111,785.09) Disbursements Prior year accrued expenses 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 O&M Expenses (3,010,925.55) (943,393.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (195,684.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) R&C Fund Disbursement (2,130,888.00) (560,000.00) (325,000.00) (475,000.00) 0.00 0.00 (95,888.00) (675,000.00) Debt Service Payment (12,276,325.00) (3,238,162.50) (9,038,162.50) ASSUME DEBT Capital Requisitions 0.00 SERVICE PD 06/30/05 Excess Eamings Transfer (225,000.00) (225,000.00) C** -- “djustment-Equal Sch G 0.00 (17,643,138.55) _(1,728,393.71) (512,184.71) (662,184.71) (187,184.71) (187,184.71) _~ (291,572.71) _(3,425,347.21) (187,184.71) (187,184.71) (862,184.71) (187,184.71) (187,184.71) _(9,038,162.50) Adjust to Actual 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Ending Balance 18,495,399.47 _19,043,043.97 _19,874,623.59 20,556,203.21 21,712,782.83 _ 22,869,362.45 _23,921,554.07 _—-22,537,448.95 _23,694,028.57 _24,850,608.19 25,332,187.82 _26,488,767.44 _27,645,347.06 _18,495,399.47 Interest Income Projection Estimated Accrued Interest 1,517,966.47 103,784.59 108,316.70 112,031.31 118,334.67 124,638.03 130,372.47 122,829.10 129,132.46 135,435.81 138,060.42 144,363.78 150,667.14 Adjust to Actual Received 1,517,966.47 103,784.59 108,316.70 _ 112,031.31 118,334.67 124,638.03 130,372.47 122,829.10 129,132.46 135,435.81 138,060.42 144,363.78 150,667.14 0.00 Payment of Accrued Interest 697,477.76 —S— Actual Balance per Statements — 18,495,399.90 Difference (19,043,043.97) (19,874,623.59) (20,556,203.21) (21,712,782.83) (22,869,362.45) (23,921,554.07) (22,537,448.95) (23,694,028.57) (24,850,608.19) (25,332,187.82) (26,488,767.44) (27,645,347.06) 0.43 3/16/20058:34 AM H:\ALL\imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xisSchedule I-Interest Inc BRADLEY LAKE MONTHLY UTILITY CONTRIBUTION SCHEDULE C POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC. CITY OF SEWARD POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC CITY OF SEWARD COMPONENTS OF CHANGE IN CONTRIBUTION FY2005 ANNUAL CONTRIBUTION Revenue Changes (INCREASE) DECREASE IN BUDGETED INTEREST EARNINGS Expenditure Changes INCREASE (DECREASE) IN BUDGETED O&M COSTS INCREASE (DECREASE) IN PAYBACK TO R&C FUND INCREASE (DECREASE) TRANSMISSION RELAYS REPLACEMENTS INCREASE (DECREASE) VEHICLE PURCHASE INCREASE (DECREASE) IN DEBT SERVICE INCREASE (DECREASE) IN EXCESS EARNINGS TRANSFER INCREASE (DECREASE) IN OPERATING RESERVE TRANSFER Other IMMATERIAL ROUNDING DIFFERENCES FY2006 ANNUAL CONTRIBUTION AMENDED ACTUAL BUDGET BUDGET PERCENT FY2004 FY2005 FY2006 FY2006 SHARE TOTAL TOTAL TOTAL INCREASE 30.4% 4,509,110 4,873,130 4,902,050 28,920 25.9% 3,841,634 4,151,786 4,176,420 24,634 25.8% 3,826,802 4,135,754 4,160,292 24,538 16.9% 2,506,706 2,709,074 2,725,152 16,078 1.0% 148,322 160,298 161,256 958 100.0% 14,832,574 16,030,042] 16,125,170 95,128 AMENDED FY2004 FY2005 PERCENT MONTHLY MONTHLY FY2006 FY2006 SHARE AVERAGE AVERAGE | MONTHLY | INCREASE 30.4% 375,759 406,094 408,504 2,410 25.9% 320,136 345,982 348,035 2,053 25.8% 318,900 344,646 346,691 2,045 16.9% 208,892 225,756 227,096 1,340 1.0% 12,360 13,358 13,438 80 100.0% 1,236,047 1,335,836 7,928 16,030,046 34,357 (273,886) 549,163 (200,000) 3,275 (2,782) (15,000) NET INCREASE(DECREASE) 95,127 16,125,173 (1) 3/31/20058:44 AM H:\ALL\Imacmillan\BradleyLake\F YO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule C Utility Contrib ITEM 7E Resolution to Extend the Operation and Maintenance Agreement With Homer Electric Association Whereas Homer Electric Association, Inc. has performed the Operation and Maintenance of the Bradley Lake Hydroelectric Project for the last ten years and Whereas Homer Electric Association, Inc. has performed these services with diligence, care and in a cost effective manner and Whereas Homer Electric Association, Inc. has developed the expertise required and Whereas Homer Electric Association, Inc. has coordinated their communication system with that of the Bradley Lake Hydroelectric Project; Now therefore be it resolved to request the Alaska Energy Authority to extend the current Operation and Maintenance Agreement with Homer Electric Association, Inc. for an additional five years. MOTION: bayer Corner SECOND: Cb Copter VE x og A att ) ~ Neu / Jee. Ms 4 toll : y WH BE eee ME { /\ | Ach Now teow | a ble A — fe ‘i ee A OPERATION & MAINTENANCE AGREEMENT FOR BRADLEY LAKE PROJECT AMENDMENT NUMBER ONE THIS AMENDMENT NUMBER ONE to the Operation and Maintenance Agreement for Bradiey Lake Project dated February 11, 1994, (hereinafter . O&M Agreement) is entered into by the HOMER ELECTRIC ASSOCIATION, INC. (HEA) (¢“Operator') and the ALASKA ENERGY AUTHORITY (“Authority”) on this 2TH day of August, 1996. The O&M Agreement is hereby amended as follows: : } For the purpose of maintenance and operation of the 115 kV electric transmission line facilities identified in Exhibit A, Section 2.12, the maintenance duties and obligations of the Operator, pursuant fo Sections 4 and 5 of the O&M Agreement, shall not include the operation and maintenance of the electric transmission line facilities. The. electric transmission line facilities shall be operated and maintained under a separate Transmission Line Facilities Operation and Maintenance Agreement. All other terms and conditions of the O&M Agreement shall remain in full force and effect and are unchanged by this Amendment. HOMER ELECTRIC ASSOCIATION, INC, ALASKA ENERGY AUTHORITY By Xe Wren eb WISI ca iM a ‘ BRADLEY LAKE PROJECT OPERATION & MAINTENANCE AGREEMENT AMENDMENT NUMBER ONE BRADLEY LAKE HYDROELECTRIC PROJECT AGREEMENTS Agreement Bradley Lake Communications Agreement Attachment Agreement for the Sale and Purchase of Electric Power (“Power Sales Agreement”) Exhibits A-E- Agreement for the Dispatch of Electric Power and for Related Services (“Bradley Lake Dispatch Agreement”) Agreement for the Dispatch of Electric Power and for | Related Services (“Bradley Lake Dispatch Agreement”) Bradley Project Management Committee Bylaws Operation & Maintenance Agreement for Bradiey Lake Project Exhibits A-C Exhibit D Amendment #1 Operation & Maintenance Agreement for Bradley Lake Project Master Maintenance and _ Operating Agreement Exhibit A (Ex. D O&M Agree) Date 9/29/92 12/8/97 2/19/92 8/20/96 12/1/93 2/11/94 5/24/94 8/26/96 5/24/94 Parties AEA, CEA, HEA AEA, AEG&T, CEA, GVEA, HEA, MEA, ML&P, SES AEA, CEA AEA, CEA BPMC AEA, HEA AEA, BPMC, HEA AEA, HEA AEA, BPMC Bradley Lake Project Agreements Page 2 Allocation and Scheduling 3/3/93 BPMC Procedures 7 Exhibit A -?- Exhibit B-D 3/3/93 Transmission Facilities 8/26/96 AEA, HEA Maintenance Agreement Exhibits A-B Agreement for the Wheeling 12/8/87 CEA, AEG&T, GVEA, of Electric Power and for ite HEA, MEA, ML&P, SES Related Services : Appendices A-E Amendment to Agreement for 3/7/89 HEA, AEGAT, CEA, Sale of Transmission Capability GVEA, ML&P Soldotna Static Var 8/20/96 AEA, CEA _ Compensator Facilities Maintenance Agreement Construction Services Draft AEA, HEA Agreement " Transmission Interconnect Not AEA, HEA Agreement Required Exhibit A OPERATION & MAINTENANCE AGREEMENT FOR BRADLEY LAKE PROJECT BETWEEN HOMER ELECTRIC ASSOCIATION, INC. AND ALASKA ENERGY AUTHORITY Section Section Section Section Section Section Section Section Section Section Section Section Section Section Section Designated Section Section Section Section Section 10 Ler 12 3 14 LS) 16 ty 18 19 20 TABLE OF CONTENTS DELI CLOMS ce cers cine te icine © oe sie cs ccc o eieie © © alien 2 TOG OF AGTWGEE ccwe wc cme see hE EBS 4 Qualitied UEtTity Status: <6 ccc. - see susie swine s 5 Operator's General, Dutdies < 6.4< 66 secs swe oss s 5 Operator's) Specific DUETES 2552 2 ee - ee se ew 6 Accounting and Records) o... 5 sic «© asiew @ slice @ ociis <3 8 Badgee. anv cee ees KORN ROR ESAT Ee eRe RE TEE 5 Extraordinary. 'COSES Coe e oleic Jide Scie soil © «i 10 Emergency Expenditures .............-.e eee eeee 10 = Disbursement (Of FUNKS) ~~ 2 cree. @ sei © sis sini © ale - Access to Operator's Facilities ............. 11 - Use of Project Living Quarters .............. abab SP PLN SUTATICE Ie aiteyiel one) trolle ol oliaso ei sislielor ol visiie’@o) esis la silere olen 12 = Dispute Resolution <15.. 5 sec © o ele @ « sine © aioe © Sate 16 - Notices, Time and Holidays Computation, REPrESENEACIVESD «a2, © sic @ oes «os sic © oeiee © iste » cele 16 = Remedies Cumulative) oc ose mes 6 omic © eins 9 Ame 16 - Availability of Information ................. 7 = VLETMiI NA ETON ere eerie! aieliele eifeiicticl ol sielicte os) ae = elielle <1 sile(6 alg) = FFOrce (MagjiGure s.r « aiste 0 s.site 3 © sisia sc! «) ere © © sistee © sileiio 17 = Third Party Beneficiaries 2 oi.% 6 sic 6 3 sum « sc s 18 Sectdion=2i=—- Assignment (of Contract =o. ceccseco-o oopies: ousiiore <nsifer eves elle 19 Section 22 = Racist S ltozonchtove.coctrovere! spensver cn cisilctenelofelioliars: efelioreneisierereloro a9 Sectiion=23=—=Muliti pli eeCops eiizerererelienorerereiioiotersaoietereren tein cee ere nel 19) Section 24 - Entire Agreement; Priority of Power Sales PATONG 6 ii ERS eet eee ee ee ee 19 OPERATION & MAINTENANCE AGREEMENT FOR BRADLEY LAKE PROJECT THIS AGREEMENT dated this Lt day of February, 1994, is entered into by the HOMER ELECTRIC ASSOCIATION, INC. (HEA) ("Operator") and the ALASKA ENERGY AUTHORITY ("Authority"). WITNESSETH WHEREAS, the Authority is a public corporation of the State of Alaska duly created, organized, and existing pursuant to AS 44.83, and authorized by law to sell electric power generated by the Bradley Lake Project ("Project"); WHEREAS, the Authority is authorized under AS 44.83.396 to enter into agreements for the operation and maintenance of power projects owned by the Authority with a "qualified utility"; WHEREAS, the Bradley Lake Project Management Committee ("BPMC") is authorized under its Bylaws adopted pursuant to the terms of the Bradley Lake Project Power Sales Agreement, to approve agreements for the operation and maintenance of Project facilities; WHEREAS, the Operator has been identified in the "Bradley Lake Hydroelectric Project Agreement for the Wheeling of Electric Power and Related Services" (Services Agreement) dated June 29, 1989 by the participating utilities as one of the two appropriate entities to operate and maintain the Project (the other being the Alaska Electric Generation and Transmission Cooperative, Inc.); 1 - OPERATION & MAINTENANCE AGREEMENT WHEREAS, the Operator is both a qualified utility within the meaning of AS 44.83.425(5) and is authorized to operate and maintain a power project acquired or constructed by the Authority; and WHEREAS, the Operator has agreed to operate and maintain the Project in accordance with the terms and conditions of this Agreement; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: Section 1 - Definitions For purposes of this Agreement, the following definitions apply: (a) (b) (c) (d) (e) "Act" or references to AS 44.83, mean Title 44, Chapter 83 of the Alaska Statutes (1989), as amended. "Agreement" means this Agreement. "Authority" means the Alaska Energy Authority as established by the Act, and any successor agency thereto and, unless the context otherwise requires, such officers and agents of the Authority that may be delegated responsibilities and duties under this Agreement. "BPMC" means the Bradley Lake Project Management Committee as established under the December 8, 1987 Power Sales Agreement and operating under the Bylaws adopted on October 19, 1988. "Contract Year" means, except for the first and last Contract Years, the twelve month period starting July 1 of a calendar year through and including June 30 of the next succeeding calendar year. The first Contract Year shall be the period commencing with the effective date of this Agreement and extending through and including the succeeding June 30. The last Contract Year shall be the period commencing after the 2- OPERATION & MAINTENANCE AGREEMENT last full (i.e., twelve - month) Contract Year and ending on the expiration of this Agreement. (f) "Dispatch" means to schedule daily and remotely monitor and control the voltage, frequency, and real and reactive power flow through the Project. (g) "Dispatch Agreement" means the Agreement for the Dispatch of Electric Power and for Related Services between Chugach Electric Association, Inc. and the Alaska Energy Authority dated February 19, 1992. (h) "Division of Risk Management" means an office which is part of the State Department of Administration and which is established pursuant to AS 44.21.020. (i) "FERC" means the Federal Energy Regulatory Commission, an agency of the United States Department of Energy, or its successor agency. (j) "Master Operating Agreement" means the Master Operating Agreement between the Authority and the BPMC to be executed by the BPMC and the Authority after approval by the BPMC. (k) "O&M" means operation and maintenance of the Project and includes the duties set forth in Section 4 of this Agreement. (1) "Operation and Maintenance Standards" means the Plant Operation and Maintenance Manual, and equipment installation, operation, and maintenance manuals. m "Operator" means Homer Electric Association, Inc. A) or its assignee. p 8 (n) "Party" or "Parties" means each or all the signatories to this Agreement. ° "Power" or "Electric Power" means electric energy or electric capacity, or both, gy pacity. except where the context requires a distinction, in which case electric energy is expressed in kilowatt hours, and electric capacity is expressed in kilowatts. 3 - OPERATION & MAINTENANCE AGREEMENT (p) (q) (r) (s) "Power Sales Agreement" means the Bradley Lake Power Sales Agreement, dated December 8, 1987, among the Authority; the Municipality of Anchorage (d.b.a. Municipal Light and Power (ML&P)); the City of Seward (d.b.a. Seward Electric System (SES)); the Chugach Electric Association, Inc. (Chugach); the Golden Valley Electric Association, Inc. (GVEA); the Alaska Electric Generation and Transmission Cooperative, Inc. (AEG&T), the Matanuska Electric Association, Inc. (MEA); and the Homer Electric Association, Inc. (HEA). "Project" means the Bradley Lake power generation facility and the associated transmission and substation facilities described in Exhibit A. "Project O&M Budget" means the budget for the operation and maintenance of the Project as adopted and amended pursuant to this Agreement. "Purchaser" shall have the meaning given to that term by the Power Sales Agreement. Section 2 - Term of Agreement (a) (b) This Agreement shall take effect upon execution by the authorized representatives of all Parties. The term of this Agreement shall be five (5) years from the date on which it takes effect and shall continue from year to year thereafter, except upon written notice to terminate. Notice of termination by the Operator shall be given one (1) year in advance, effective on July 1 of the next Contract Year. Notice of termination by the Authority shall be given one (1) year in advance, effective on July 1 of the next Contract Year; provided, however, if the Authority reasonably determines that termination is necessary to avoid substantial damage to the Project or endangerment to public health or safety, this Agreement may be terminated in accordance with subsection (c). 4- OPERATION & MAINTENANCE AGREEMENT (c) In the event the Authority reasonably determines that the Operator's performance of its obligations under this Agreement, without immediate remedial actions, could cause substantial damage to the Project or endanger public health or safety, the Authority shall promptly notify the Operator and shall identify the areas where performance must be remedied. The Operator shall submit to the Authority a plan for remedial action to correct its performance within twenty-four (24) hours of such notice. The Authority or its designee shall have the right to temporarily take over the duties of the Operator until a remedial action plan reasonably satisfactory to the Authority is agreed to by the Operator. If the Parties fail to agree to a remedial action plan within thirty (30) days of submission, the Authority may terminate this Agreement. Section 3 - Qualified Utility Status The Authority has determined that the Operator is a qualified utility within the meaning of AS 44.83.425(5) and has met all the requirements thereof. Section 4 - Operator's General Duties To the extent authorized by the Project O&M Budget or as otherwise funded in accordance with this Agreement and consistent with the provisions of Exhibit "D", the Operator shall: (a) (b) Operate and maintain the Project so as to make power available to the Purchasers in an amount equal to the amount the Purchasers may schedule from the Project, within the limitations imposed by available Project capability, available water, and the scheduling procedures adopted by the BPMC; Bring to the attention of the Authority Required Project Work (as defined in the Power Sales Agreement), and perform or cause to be performed such Required Project Work to the extent funds are made available for such purpose. 5- OPERATION & MAINTENANCE AGREEMENT The Operator shall not perform or cause to be performed Optional Project Work (as defined in the Power Sales Agreement) unless such Optional Project Work is approved and funded by the BPMC and assigned to the Operator by the Authority. Section 5 - Operator's Specific Duties To the extent authorized by the Project O&M Budget or as otherwise funded in accordance with this Agreement, the Operator shall: (a) (b) (c) (d) (e) Coordinate operation, maintenance, repair and other work schedules with the Purchasers in accordance with the Bradley Lake Allocation and Scheduling Procedures; Operate, maintain, and repair the Project in accordance with the Operation and Maintenance Standards. In addition the Operator shall use and update the Automated Maintenance Management System or such equivalent system as the Authority may direct. The Operation and Maintenance Standards shall be maintained at the Project site. Any revisions to the Operation and Maintenance Standards shall be effective within a period of time after notice having due regard to the nature of the revisions requested and necessary project budget revisions. Provide all material, labor, engineering and other technical support, subcontract management, and training to operate, maintain, and repair the Project, and all tools, equipment, spare parts, materials, and supplies needed to perform work under this Agreement in accordance with the Operation and Maintenance Standards and written directives by the Authority. Comply with all applicable federal, state, and local government laws, regulations and permits. Ifthe Operator elects to contest an order issued by a local government, state or federal agency (other than the Authority), the Operator shall promptly notify the Authority and the BPMC. Provide security and access in accordance with a mutually agreed plan; 6 - OPERATION & MAINTENANCE AGREEMENT (f) Read, maintain, and operate all Project metering devices, record such readings, and maintain or forward data, forms, relevant graphs, and/or magnetic tapes as required by the Authority; (g) | Make annual recommendations to the Authority and BPMC for: qd) operation, maintenance, repair, replacement, and modification of Project facilities; (2) _ installation of additional protective relaying, instrumentation, control systems, or other apparatus as necessary to maintain or improve the Project and interconnected system reliability, integrity, efficiency, and safety; (3) a five (5) year schedule of estimated equipment modifications, replacements, additions, and disposals; (h) Prepare monthly and year-end operating and financial statements, in a form acceptable to the Authority relating to the performance of this Agreement; (i) Provide qualified personnel with the ability to perform the duties assigned to the Operator under this Agreement; G) Prepare and conduct an annual training program that meets the minimum training standards established by the BPMC. The Authority may require the Operator to undertake additional training which the Authority deems necessary, however, funding for such additional training is the responsibility of the Authority; (k) Following a protective relay or alarm action, and upon observation or notification, interpret the cause, identify corrective measures, and take corrective action as the situation warrants. The Operator shall document any such actions within three (3) days of their accomplishment; (ly Take prudent measures to protect equipment, personnel, and the general public from hazards arising from equipment failure such as electrical faults, vandalism, and mechanical 7- OPERATION & MAINTENANCE AGREEMENT (m) (n) (p) (q) (r) (s) failure and repair and report damaged facilities to the Authority, to the BPMC on behalf of the Authority and any appropriate law enforcement authority, as soon as possible following each occurrence; Record the operating characteristics of the power plant equipment and machinery as required; Maintain the Project living quarters, including expenses for utility services, as a cost of operation and maintenance; Update, keep and make available to the Authority or any Purchaser the required Project documents, as-built drawings, and other records, including records to meet FERC license requirements and records required by any project related insurance agreements; Perform water and power operation studies as required to integrate power from the Project into the Purchasers’ systems with due regard for the capability limits of the Project, planned water reserves, and Purchasers' power needs; Arrange for and administer subcontracts or agency agreements related to the O&M of the Project; Conduct all technical, operation, and maintenance inspections of the Project in accordance with FERC and other permits or agency requirements, and submit inspection and other reports to the appropriate entities as directed by the Authority; Support the Project by coordinating related technical and operating activities with the Purchasers; and Perform such other additional duties related to the operation, maintenance and repair of the Project as may be included in the Project O&M Budget. 8- OPERATION & MAINTENANCE AGREEMENT Section 6 - Accounting and Records In keeping any books of account required by Section 5, the Operator shall, to the extent that different rules are not prescribed by this Agreement or federal and state laws, follow the system of accounts prescribed for public utilities and licensees by FERC. Upon reasonable notice, the Operator and its contractors or subcontractors shall allow the Authority, BPMC, or their authorized representatives to audit books of account for the Project O&M and the supporting documents of the Operator and its contractors or subcontractors related to the Project O&M for a period of three (3) years following the close of a Contract Year. The audit shall be performed in such a manner that will not unreasonably interfere with the Operator's duties under this Agreement. Section 7 - Budget (a) (b) (©) (d) After the effective date of this Agreement, and in accordance with schedules provided by the Authority, the Operator shall prepare and submit each year to the Authority and the BPMC a draft O&M budget for the Project for the following Contract Year. The draft O&M budget shall be based upon prudent estimates and anticipated O&M requirements and expenditures, and reflect appropriate accounting and budgetary principles for utilities. The draft budget shall be prepared in a format and schedule provided to the Authority by the BPMC. Not less than 30 days prior to the beginning of a Contract Year the BPMC or the Authority acting pursuant to Section 13 (c) of the Power Sales Agreement shall adopt a Project O&M Budget for the Contract Year. The Operator shall perform its duties in a manner consistent with the Project O&M Budget except as provided in Sections 8 and 9 below. Ifthe Operator makes a determination during any Contract Year that it cannot perform its obligations under this Agreement without an increase in the expenditures authorized under the Project O&M Budget, the Operator shall report such finding to the Authority and the BPMC and shall submit a revised budget for the Authority's and the BPMC's 9- OPERATION & MAINTENANCE AGREEMENT review and approval. In the event the revised budget is not adopted by the BPMC and the Authority, or the Authority, pursuant to Section 13(e) does not authorize and agree to fund such expenditures, and the Operator determines that it cannot perform its obligations under this Agreement, the Operator may terminate this Agreement upon 90 days notice to the Authority." Section 8 - Extraordinary Costs (a) (b) (c) Extraordinary costs are costs for operations, maintenance, repair or equipment replacement which were not anticipated to materialize in the Contract Year, and not provided for in the Project O&M Budget. If the Operator learns of an event or other contingency which involves an extraordinary cost, the Operator shall promptly notify the Authority and the BPMC of the circumstances and request authorization to make such expenditures. If required by the Authority, the Operator shall develop a scope, schedule, budget and proposed plan of work and deliver the same with a request to proceed as soon as practicable. The Authority shall respond in writing to the Operator's request as soon as practicable after the receipt of the plan. Upon approval by the BPMC and the Authority, or by the Authority alone, pursuant to Section 13(e) of the Power Sales Agreement, the Operator shall perform such work consistent with the plan. The Operator shall not incur any extraordinary costs without the written approval of the BPMC and the Authority, or by the Authority, pursuant to Section 13(e) of the Power Sales Agreement except as provided in Section 9 below. Section 9 - Emergency Expenditures (a) An emergency is an unforeseen combination of circumstances or the resulting state that requires immediate action to protect or preserve the Project, Project personnel, or public health and safety. 10 - OPERATION & MAINTENANCE AGREEMENT (b) The Operator shall take such actions as it reasonably believes are necessary in an emergency. If, in the reasonable judgment of the Operator, the emergency requires the Operator to incur costs prior to obtaining written approval from the Authority, the Operator shall notify the Authority and the BPMC of the emergency as promptly as practicable with due regard to the emergency. Section 10 - Disbursement of Funds (a) (b) (c) (d) The ordinary costs of performing under this Agreement shall be initially paid by the Operator. The Operator shall prepare an invoice identifying the actual costs incurred in a format mutually agreeable to the Authority and Operator. The invoice shall be furnished to the Authority by the fifteenth (15) of the month following the month in which the costs are incurred. All such invoices shall be subject to audit and approval by the Authority, such approval shall not be unreasonably be withheld. Subject to the availability of funds, the Authority shall reimburse the Operator for all costs under this Agreement. Any amounts owed by the Authority to the Operator shall be paid by the Authority within thirty (30) days of receipt of a bill from the Operator. Any amounts not paid within thirty (30) days shall accrue simple interest at the legal rate of interest at the time payment was due, and shall continue until paid by the Authority. Section 11 - Access to Operator's Facilities Authority and BPMC personnel or agents shall be granted reasonable access to the Project and the Project owned equipment and facilities on the Operator's premises upon reasonable notice and subject to security measures, for the purpose of inspection and testing. 11 - OPERATION & MAINTENANCE AGREEMENT Section 12 - Use of Project Living Quarters (a) Use of living quarters is established by the Bradley Work Rules. Modification of the Work Rules requires the approval of the Authority and the BPMC. (b) | The Operator shall schedule occupation of the Project living quarters in an efficient manner. The Operator shall include in such scheduling, quarters for visiting employees of the Operator, subcontractors, the Authority, and the BPMC as needed and available. (c) | On-site operations and maintenance personnel shall have priority in the use of permanent residences at the Project. Section 13 - Insurance (a) General. Q) (2) (3) Each Party shall be liable for the negligent, willful and grossly negligent acts of its officers, employees, agents and contractors with respect to the ownership, construction, operation, maintenance or repair of the Project. Its is recognized that the project insurance does not cover the willful and grossly negligent acts of a party. Each Party shall be solely liable for the willful and grossly negligent acts of its officers, employees, agents and contractors. During the term of this Agreement, the Operator shall use its best efforts to maintain insurance satisfactory to the Authority and the BPMC covering injury to persons or property suffered by any Party or a third party, as a result of errors, omissions, or operations which arise both out of and during the course of this contract by the Operator or by any of its contractors. Such "Operator insurance" may be obtained either by the Operator or be provided by the Authority or the BPMC under insurance policies covering the Project. Such Operator's insurance shall be the primary coverage for the exposures delineated in subsection (2) above with respect to the State of Alaska, its officers, agents, and employees, the BPMC, its officers, agents, and employees, and the Operator, its officers, agents, and employees, as named insureds. Any additional insurance or self-insurance separately maintained by the State, except insurance 12 - OPERATION & MAINTENANCE AGREEMENT (4) (5) (6) (7) (8) (9) (10) purchased on behalf of the BPMC, shall be in excess of the Operator's insurance and shall not contribute to it. The Operator will bear the cost of the required insurance, which cost shall be included in the Project O&M Budget as an operating cost. If the Operator elects to individually obtain the insurance required by subsection (2) above, it may be maintained as part of any other policy or policies of the Operator so long as the coverage of such policy or policies is substantially the same as if such coverage were maintained under a separate policy. The policy must be acceptable to the Division of Risk Management. Policies maintained under this Agreement must provide that any cancellation, non- renewal or material change be upon thirty (30) days written notice to all named insureds. Insurance Companies shown on the certificate of insurance must be acceptable to the Authority. The Authority shall not unreasonably withhold approval of such Insurance Company. The Operator shall, at least thirty (30) days prior to cancellation, non-renewal, or material change, provide the Authority with written evidence of insurance which replaces or reinstates the required insurance coverage. A copy of the insurance policies required by this Section will be furnished to the Authority prior to beginning work under this Agreement. Prior to February 1 of each year thereafter, evidence of insurance shall be provided by the Operator. The obligation to obtain and maintain insurance coverage pursuant to this Section shall be subject to the general availability of such coverage under reasonable terms and conditions. If one or more of the required insurance coverages is not available under reasonable terms and conditions, the Operator shall, under the guidance and direction of the BPMC and Division of Risk Management, use its best efforts to obtain substantively equivalent insurance coverage acceptable to the BPMC, the Authority, and the Division of Risk Management. If, after utilizing its best efforts, the Operator is unable to obtain the required insurance coverage under reasonable terms and conditions, as reasonably determined by the Operator, the Operator shall request a waiver of the relevant insurance requirement. The request shall outline steps taken by the Operator to obtain such insurance and shall disclose quotations received for coverage. To the 13 - OPERATION & MAINTENANCE AGREEMENT (b) (c) ql) (12) extent the waiver will not materially affect the safe and prudent operation of the Project, the Authority, after consulting with the Division of Risk Management, will not unreasonably withhold approval of the requested waiver. Failure to furnish satisfactory evidence of insurance or failure to maintain the policy without complying with this subsection shall result in a material breach of this Agreement. Any Party, before the expiration date of the existing policy, may reopen the insurance requirements on sixty (60) days notice. The Authority shall annually, prior to February 1st each year, furnish evidence of insurance to the Operators and the BPMC. Workers' Compensation Insurance. Q) (2) (3) The Operator shall maintain, for all employees of the Operator engaged in work under this Agreement, workers' compensation insurance as required by AS 23.30.045. The Operator is responsible for workers' compensation insurance for any of its subcontractors who directly or indirectly provide services under this Agreement. The insurer shall agree to waive all rights of subrogation against the State of Alaska, its officers agents, and employees for losses arising from operation of the Project. Workers' compensation insurance policy must include: @) statutory coverage for states in which employees are engaging in work; (ii) Employer's Liability Protection of not less than $500,000 per occurrence; (iii) | Broad Form All States Endorsement; and (iv) coverage as required by all State and Federal Acts where applicable. Comprehensive General Liability Insurance. (1) The Operator shall maintain comprehensive general liability insurance. The Authority, acting on behalf of the BPMC, has as of the effective date of this Agreement acquired general liability insurance which satisfies part of this 14- OPERATION & MAINTENANCE AGREEMENT (d) (¢) (2) requirement. The Operator shall secure any additional insurance as required to meet its obligations under this subsection to the extent the insurance so acquired by the Authority is not sufficient to meet the Operator's obligations. The BPMC and the Authority shall be included as additional insureds as respects insurance required in this Section and shall not by their inclusion be responsible to the insurance carrier for payment of premium therefor. These insurance policies must also contain a provision providing for cross liability or severability of interest. The comprehensive general liability insurance shall be subject to the following limits of liability: @ Bodily Injury and Property Damage Liability of a minimum $5,000,000 Combined Single Limits each occurrence and affording insurance for Premises Operations, Owners and Contractors’ Protective, Independent Contractors, Products/Completed Operations, Blanket Contractual Liability, Broad Form Property Damage, and personal Injury Liability; (ii) Automobile Liability Insurance covering all vehicles. Such insurance shall provide coverage of not less than $5,000,000 Combined Single Limit each occurrence for Bodily Injury and Property Damage Liability. Additional Liability Insurance. The Operator shall maintain the following additional insurance, where applicable, for aircraft and watercraft owned or contracted for by the Operator. (1) (2) Owned Aircraft and Non-Owned Aircraft with seating capacity of five seats or less, except commercial, scheduled flights, with limits of liability not less than: $5,000,000 for Bodily Injury per occurrence; $1,000,000 for Passenger Liability per seat; and $5,000,000 for Property Damage Liability per occurrence. Coverage must include Slung Cargo exposures. If an aircraft with more than five seat capacity is used, special coverage and limits must be obtained and must be approved by the Authority; and Owned Watercraft and Non-Owned Watercraft with limits of liability not less than $5,000,000 per single occurrence as provided in the "in Rem Endorsement" under "Maritime Coverage B." Subcontractor's insurance. 15 - OPERATION & MAINTENANCE AGREEMENT Any contract entered into with a subcontractor, other than a Purchaser, by the Operator to perform part of its obligations hereunder shall include the indemnity and insurance provisions attached as Exhibit C. The Operator may request a waiver of part or all of such provisions where such waiver will not materially affect the Project and the Operator determines the waiver is necessary to its performance of this Agreement. The Authority will not unreasonably withhold approval of such waiver. Section 14 - Dispute Resolution Pending resolution of a disputed matter, the Parties will continue performance of their respective obligations pursuant to this Agreement. If the Parties cannot reach timely mutual agreement on any matter in the administration of this Agreement, the Operator shall, to the extent necessary for its continued performance, make a determination of such matter without prejudice to the rights of the other Parties. Such determination shall not constitute a waiver of any other remedy belonging to either Party. Section 15 - Notices, Time and Holidays Computation, Designated Representatives (a) (b) Any notice required to be given to any Party by this Agreement shall be effective when it is received by such Party. In computing any period of time from such notice, the period shall commence at 12:01 p.m. on the date of receipt of such notice. Notice to Operator required by this Agreement shall be in writing directed to the General Manager of Homer Electric Association, Inc., 3977 Lake Street, Homer, Alaska 99603. Notice to the Authority required by this Agreement shall be in writing addressed to the Executive Director of the Alaska Energy Authority, 480 West Tudor, Anchorage, Alaska 99503. If the date for making any payment or performing any act is a day on which banking institutions are closed in the place where payment is to be made or a legal holiday, payment may be made or the act performed on the next succeeding day which is neither a legal holiday nor a day when banking institutions are closed. 16 - OPERATION & MAINTENANCE AGREEMENT (c) Each Party shall designate a representative to act for it in matters not requiring formal action by its governing bodies. Either Party may at any time change its designated representative by giving written notice to the other Party. Section 16 - Remedies Cumulative No remedy conferred upon or reserved to the Parties under this Agreement is intended to be exclusive of any other remedy or remedies existing at law or equity. Section 17 - Availability of Information The Parties shall make available to each other, for inspection and copying during business hours, all books, records, plans and other information relating to any calculation or determination to be made under this Agreement. Section 18 - Termination (a) Not less than 75 days prior to the date of any scheduled termination of this Agreement the parties shall meet for the purpose of discussing arrangements necessary for the orderly takeover of the duties of the Operator by the Authority. At or before the meeting the Operator shall submit to the Authority a takeover plan which sets forth the actions which in the opinion of the Operator are reasonably required to accomplish the takeover, and any budget amendments necessary to accomplish the plan. The Authority shall review and either approve or modify the plan and budget. The Operator shall perform in accordance with the approved plan, subject to any budgetary constraints. The Authority shall secure funding for and pay any extraordinary costs reasonably incurred by the Operator in performing its duties hereunder, including close-out and demobilization costs. 17 - OPERATION & MAINTENANCE AGREEMENT (b) Following termination of this Agreement for any cause, the Authority shall have the right and a reasonable amount of time, not to exceed six (6) months, to arrange disposition of Project-owned equipment on the Operator's premises. Section 19 - Force Majeure (a) No Party to the Agreement shall be liable to other Parties for, or be considered to be in breach of or default under this Agreement on account of, any delay in performance or any delay or failure to deliver, receive or accept delivery of energy due to any of the following events: (1) (2) Any cause or condition beyond such Party's reasonable control which such Party is unable to overcome by the exercise of reasonable diligence (including but not limited to: fire, flood, earthquake, volcanic activity, wind, drought and other acts of the elements; court order and act of civil, military or govern- mental authority; strike, lockout and other labor dispute excluding those disputes wrongfully caused by the Operator; riot, insurrection, sabotage and war; breakdown of or damage to facilities or equipment; electrical disturbance originating in or transmitted through such Party's electric system or any electric system with which such Party's system is interconnected; and, any act or omission of any person or entity other than such Party, or Party's contractors or suppliers of any tier or anyone acting on behalf of such Party); or Any action taken by such Party which is reasonably necessary or prudent to protect the operation, performance, integrity, reliability or stability of the Project or of such Party's electric system or any electric system with which such Party's electric system is interconnected, whether such actions occur automatically or manually. 18 - OPERATION & MAINTENANCE AGREEMENT (b) — Inthe event of any delay excused under this section, the time for performance thereby delayed shall be extended by a period of time reasonably necessary to compensate for such delay. No cost adjustment will be allowed, only time extensions as appropriate. Nothing contained in this paragraph shall require any Party to settle any strike, lockout or other labor dispute. Each party shall give the other Parties prompt written notice of any delay which the Party giving notice considers to be an excusable delay of its performance. Section 20 - Third Party Beneficiaries This Agreement gives no rights or benefits to anyone other than the parties, the Operator and the Authority, and the BPMC as a third party beneficiary. The BPMC is the only third party beneficiary. In any action by the BPMC for damages the Operator shall have the right to assert against the BPMC any defense which it could have asserted against the Authority. The raising of any such defense by the Operator shall not affect any right of a purchaser or the BPMC under the Master Operating Agreement or Power Sales Agreement. Section 21 - Assignment of Contract HEA assignment of its rights and responsibilities under this agreement shall be subject to the approval of the Authority and BPMC. HEA expects to request approval to assign its rights and responsibilities under this Agreement to AEG&T. Approval of such assignment request is subject to a finding by the Authority that AEG&T is a qualified operator. No such assignment shall operate to relieve HEA of its obligations under this Agreement. Section 22 - Exhibits The provisions of the following exhibits attached hereto are incorporated by reference herein: Exhibit A - Project Facility Description; Exhibit B - Project Specific Federal and State Agency Requirements; Exhibit C - Insurance and Indemnification; and 19 - OPERATION & MAINTENANCE AGREEMENT Exhibit D - Exhibit A of the Master Operating Agreement Section 23 - Multiple Copies This Agreement shall be executed in several counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument. Section 24 - Entire Agreement; Priority of Power Sales Agreement This Agreement in its entirety including the Exhibits and the Power Sales Agreement represent the entire Agreement of the Operator and the Authority. Nothing in this Agreement is intended to alter the rights and obligations of the Authority and the Purchaser(s) under the Power Sales Agreement. In the event the terms of this Agreement and the Power Sales Agreement are found to be in conflict, the terms of the Power Sales Agreement shall govern. In the event of a conflict between any provision in the body of this Agreement and any provision contained in an exhibit hereto, the former shall control. Any amendments to this Agreement shall be in writing. IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed the day and year first above written. HOMER ELECTRIC ASSOCIATION, INC. By Title Lega. Date L-l- SF (SEAL) : ATTEST: * Neng & ear Chrvenepoen 7-14-27 20 - OPERATION & MAINTENANCE AGREEMENT ALASKA ENERGY AUTHORITY Title_ Executive Director Date February 11, 1994 (SEAL) ATTEST: 21 - OPERATION & MAINTENANCE AGREEMENT EXHIBIT A PROJECT DESCRIPTION 1. PROJECT DESCRIPTION ed Ue General The Bradley Lake Hydroelectric Project is located on the Kenai Peninsula at the northeast end of Kachemak Bay about 27 miles from Homer. The project contributes to the electrical generating capacity of Alaska's Railbelt serving customers from the Kenai Peninsula to Fairbanks. Major elements of the project include a concrete faced, rockfill dam, to raise the level of Bradley Lake about 100 feet, an ungated spillway having discharge capacity of 23,800 cfs at pool elevation 1190.6, a diversion tunnel which also serves as a low level outlet, a submerged intake leading to the power tunnel which, including the vertical shaft, is 19,152 ft. long, a surface powerhouse located on the shore of Kachemak Bay and a tailrace channel into the bay. All elevations given in this report are referred to Bradley Lake Project Datum, at which zero is equal to 13.63 ft. above MLLW at Bear Cove. The two unit plant has a nominal generating capacity of 90 MW at 917 ft. net head. Each generating unit consists of a six jet, vertical shaft Pelton turbine driving a 63 MVA generator at 0.95 power factor. The penstock for a future third unit was also constructed as part of the initial project development. Usable storage in Bradley Lake at full pool (El 1180) is about 280,000 acre ft. The project is connected to the existing Kenai Peninsula transmission line, consisting of two parallel 115 KV lines. The lines run through the Fox River Delta to connect with Homer Electric Association's Fritz Creek to Soldotna Transmission line. A summary of pertinent project data is given on Table 1. History of Development The power generation potential of Bradley Lake was first studied by the U.S. Corps of Engineers and presented in a report dated March 1955. The project was authorized by Congress in 1962, but despite its feasibility federal funds were not available for its construction. The Alaska Energy Authority (then Alaska Power Authority) assumed responsibility for the project in 1982. Preliminary plans were developed and field investigations started in 1982. In April 1984, the Authority submitted an application for license to the Federal Energy Regulatory Commission (FERC). The license to construct the project was issued on December 31, 1985. A-1 The first major contract, "Site Preparation" was let in 1986 and was completed in 1987. This contract included on-site access roads, barge dock, airstrip, permanent facilities, construction camp and diversion tunnel. Following a one year hold on project construction, the General Civil Construction and Transmission Line Clearing Contracts were awarded in June 1988. The Powerhouse Construction Contract was awarded in December 1988 and the Transmission Line Construction Contract was awarded in June 1989. The General Civil Construction and the Powerhouse contracts were completed in August 1991. The Alaska Energy Authority issued a contract for supply of the turbines and generators in 1987, and issued a contract for supply of the SCADA control systems in July 1989. Smaller contracts were also issued for transmission line surveying, geotechnical surveys, and construction of the Middle Fork and Nuka Diversion structures. The diversion tunnel was closed in October 1990, however all inflow to the reservoir was released through the fish water bypass lines. Actual storage in the lake started in Spring 1991 when enough water was available to meet downstream minimum flow requirements. A contract for Site Rehabilitation was issued in June 1991. Both units were released to dispatch in August 1991, and the Project was declared in commercial operation September 1, 1991. Construction of the project was completed on November 21, 1991, with the completion of the Site Rehabilitation work. 2. DESIGN 2.1 Geology Except for the transmission line, all major elements of the project are founded on or in the bedrock. The geology of the site is composed of Upper Mesozoic Age metamorphic rocks of the McHugh Complex. Most probably this melange is composed of turbidites which have been slightly to moderately metamorphosed. Rock types encountered are graywacke, argillite, chert, dacite, metatuff, and greenstone. The graywacke, argillite and mixtures of these rocks are dominant. Chert occurs as nodules and lenses in the argillite and metatuff with some massive beds up to 15 ft thick. The diabase occurs as intrusive dikes generally 10 to 20 ft. in width with some dikes about 40 ft. thick. The metatuff is metamorphosed, volcanic pyroclastic debris. Frequently it is intermixed with the argilite but some layers up to 15 ft. thick were encountered. Over all it constitutes less than 5% of the rock mass. The greenstone is metamorphosed volcanics. It constitutes less than 3% of the rock mass. Except where severely weathered, the argillite is moderately hard to hard. The graywacke, chert, dacite and greenstone are hard to very hard. A-2 2.2 Foliation (cleavage) is poorly developed in the argillite and bedding, when identifiable, is poorly preserved. The graywacke is massive and displays neither bedding nor foliation. The chert, dacite and metatuffs are generally massive and show no foliation. Jointing is well developed. It is widely spaced in the graywacke and moderately to widely spaced in the argillite. Generally three or more sets are observed resulting in blocky structures. There are some open joints in the abutment of the dam and spillway, especially in the rock know between these structures. Hydrosplitting tests made along the tunnel alignment showed low in situ horizontal stresses ranging from 0.9 to 0.5 of overburden pressure at the depth tested. Open vertical joints striking about parallel to the tunnel (N60 W) were observed during tunnel construction at depths of rock cover of as much as 1200 ft. Geologic Hazards The Pacific Plat is subducting under the North American Plate south of the coast of Alaska. The Aleutian Arc trench marks the surface juncture of the two plates. This trench trends northeast-southwest and is located about 185 miles southeast of the site at its nearest approach. The Pacific Plate is moving north relative to the North American plate. The subduction zone dips northwest and the upper contact of the subduction plate, the Benioff zone, lies at a depth of about 30 miles beneath the surface at the site. The Benioff zone is the locus of great earthquakes. Major faults in the general site area are the Border Ranges fault which lies under Kachemak Bay and the Eagle River Fault which crosses Bradley Lake near its head. Both faults trend NE-SW (about N45 E) parallel to regional structure. Three smaller faults lie within the site area crossing the power tunnel between the intake and the powerhouse. These are the Bull Moose Fault, the Bradley River Fault, and the Bear Cub Fault. These trend approximately north-south. The Bull Moose and Bradley River are the larger of these faults. Where crossed by the power tunnel they consisted of a series of gouge-filled anastamosing shears, a few feet to possibly 20 ft. wide, separated by sound rock and extending over a width of 300 to 400 ft. Lineations and minor shears parallel these faults. Seismicity of the site was investigated by Woodward-Clyde Consultants, "Report on Bradley Lake Hydroelectric Project Design Earthquake Study," 1981. They recommended an MCE earthquake spectrum normalized to zero period horizontal acceleration of 0.75g with a duration of 25 seconds for design of critical, water retaining structures. Vertical acceleration was taken at 2/3 horizontal. This spectrum has been the basis of investigation and design of the dam, spillway and powerhouse. Dynamic analyses of the dam and spillway were made using Finite Element analyses. The time- A-3 2.3 history used an accelerogram whose spectrum envelopes the Woodward- Clyde spectrum. This was constructed by combining two appropriate shorter earthquake records. This hybrid earthquake has a duration of 28 seconds. The nearest active volcanoes are Mt. St. Augustine and Mt. Redoubt which are more than 100 miles from the site across Cook Inlet. Renewed activity poses no direct threat to the project other than possible development of a tsunami due to large mud flows or slides from Mt. St. Augustine and ash falls from both. The cost of Alaska has been subjected to tsunami generated by uplift due to offshore earthquakes. This hazard was investigated by Stone & Webster Engineering Corporation in a report presented to this Board (September 1987). This report indicated an annual probability (combined earthquake and volcanic activity) of about 0.007 for a wave height at the powerhouse reaching El 25 BLP Datum (El 38.63 MLLW datum). The powerhouse is designed to withstand water to this level without damage. The hazards of seiche in Bradley Lake due to earthquake and the possibility of a wave generated in the lake by a liquefaction generated slide in the Bradley Glacier delta were investigated. It was concluded waves from these sources would not damage the dam or spillway. The mountain sides surrounding Bradley Lake are bare rock which has been scoured by late Pleistocene and recent glaciation. Minor rockfalls may result from earthquake but slides which could cause overtopping are not a hazard. The Kachemak and Nuka glaciers are sufficiently far from the lake that ice falls or slides which might result from earthquake would not reach the lake. Main Dam The dam is a concrete faced, rockfill structure. Top of the embankment is El 1190. A parapet wall at the upstream face extends to El 1194. Normal full pool (crest of the spillway) is El 1180 and pool level under PMF is El 1190.6. The parapet wall is designed to provide wave protection during floods. The face slab is 12 inches thick, constant top to bottom. The toe plinth varies in width along its contact with the rock from 10.5 ft. to 13.3 ft. Minimum thickness varies from 3 ft. to 2.25 ft. depending on location and head. The face slab is underlain by a 12 ft. wide zone of crushed rock grading from fines (passing No. 200 mesh) to 3 inch size. The toe plinth is founded on rock for its full length. General rock level in the river bottom is about El 1065 giving a nominal dam height to the top of the embankment of 125 ft. However, a narrow channel was found along the right side of the river bottom. This was excavated to bedrock, at its A-4 2.4 lowest point at El 1032, over a length of 28 ft. centered on the toe plinth and backfilled with concrete. Thus the dam is actually 158 ft. high above the lowest point in the bedrock. The rock surface drops slightly south of the left abutment under the gate shaft bench. In this area the rock is covered by overburden and some rock fill. A concrete wall was constructed across this bench. This extends down to rock for its full length of about 175 ft. A single line grout curtain is located along it. The single line ground curtain extends the full length of the toe plinth and into the abutments. Maximum hole depth is 110 ft. In general the rock was tight and takes were small. However several open joints were found in the abutments. These were grouted to refusal and check holes drilled and grouted. Alternative types of dams considered in selecting a concrete face rock fill included a thick arch structure, a concrete gravity dam or a central core embankment dam. The concrete face rockfill was selected because of its excellent resistance to earthquake, relative cost, lack of suitable earth core material, and topographic constraints, especially space for the upstream cofferdam. Slopes upstream and downstream were established at 1.6H to 1V to restrict deformation under the MCE 90.75 g horizontal) to acceptable limits. Spillway The spillway is an ungated concrete gravity section with side slopes of 3H to 10V upstream and 8H to 10V downstream. Crest length is 175 ft. at elevation 1180.00. Overall length of the spillway is 275 ft. Spillway discharge at PMF would be 23,800 cfs at a lake level of El 1190.6. A drainage and grouting gallery extends the full length of the spillway at or just above rock level. Access to this gallery is from the left abutment. A single line grout curtain having a depth of 30 to 50 ft. below rock surface inclined 20 upstream and fanning into both abutments was constructed. Drain holes are 3 inches diameter, five feet on centers, and 30 ft. deep except at the right abutment where a fan of holes 50 ft. to 60 ft. long were drilled. All seepage from the spillway drainage system is collected and discharged over a vee notch weir to permit monitoring. Ice loading causes some tension in the upstream face at about El 1170. Accordingly reinforcing was placed in the upstream face. Dynamic analyses using the hybrid accelogram confirmed that stresses are within allowable and no lateral displacement of the spillway would occur under the MCE. A-5 2.5 The spillway was model tested at Colorado State University. The model extended from well upstream of the power tunnel intake to well downstream of the main dam. Water velocities along the toe of the main dam were measured and riprap along the downstream tow sized to prevent erosion in the event of spillway operations. Power Tunnel & Intake The power tunnel system consists of an upper tunnel 738 ft. long extending from the intake through the upper elbow, a vertical shaft 647 ft. deep and a lower elbow and lower tunnel with a total length of 17,767 ft. The lower tunnel is on a 1.67% grade. The intake channel is about 350 ft. long, and the bottom at the intake is at El 1030. Dual high-pressure gates are installed in the upper tunnel about 520 ft. downstream of the tunnel portal in a vertical drywell. The gates are hydraulically actuated. An accumulator bank rides on the hydraulic system. This is sized to permit closing each gate without recharging even in the event of complete loss of power. Provision is made for stoplogs at the intake portal. The same stoplogs can also be used at the intake portal of the diversion tunnel. A rock trap is provided just upstream of the intake portal. The downstream 435 ft. of the lower tunnel is designated the manifold section. This section contains three wye-branch penstocks which extend to the powerhouse. Two are in service and one is closed by a hemispherical head to be used for a future third unit. The downstream end of the manifold is closed with a hemispherical head which can be removed as necessary for access to the tunnel. The manifold-penstock section and downstream portion of the tunnel for 2725 ft. upstream of the manifold are steel liner encased in concrete. Inside diameter of this section is 11 ft. Four drain pipes are located outside of the steel liner in the concrete encasement. Drain holes extend from these drains into rock at intervals of 10 and 20 ft. Seepage from these drains is collected and passed through the powerhouse where it can be measured. The remainder of the lower tunnel is 13 ft. ID with a 12 inch thick concrete lining. The vertical shaft and upper tunnel are 11 ft. ID lined with concrete. The manifold-penstock section was pressure tested at 960 psi (1.9 times static head) for 1 hour before encasing it in concrete. There were no indications of distress, and distortions were very small and acceptable. In situ horizontal stresses in the rock are low. To protect against possible hydro-splitting of the rock by leakage from the tunnel, the steel lining was carried to Sta. 31+58 where rock cover was equal to 0.8 of the static head. The concrete lining was reinforced to Sta. 38+60. From Sta. 31+60 to Sta. A-6 2.6 27 2.8 35+60 the rock was high pressure grouted (500 psi) using squeeze grouting procedures. Selected areas of the remainder of the lower tunnel were also reinforced. High pressure grouting (250 psi) was done from Sta. 35+60 to Sta. 38+60 and at selected areas to Sta. 64+00 to ensure that open joints intersecting or close to the tunnel were filled with high strength grout. The tunnel was first filled to the then reservoir level, El 1076, in May 1991. A falling head test for a 12 hour duration was made in late May which showed an average leakage of only 58 gpm. Powerhouse The powerhouse has a concrete substructure with steel framed superstructure. It is founded entirely in rock, and the tailrace excavation is in rock for a modest distance away from the powerhouse. The powerhouse has been designed for safety against excessive structural stresses, sliding, overturning or flotation. Loading conditions include MCE, (0.75g) DBE (0.35g), high tides, storm high tide, tsunami, and various plant conditions such as in operation, servicing, and construction including appropriate factors of safety. Diversion Tunnel The diversion tunnel is approximately 407.5 ft. long and is located in the high rock spur between the spillway and the main dam. It has been converted to a low level outlet which is normally closed by a dual system of high pressure slide gates located in a deep dry well shaft. The tunnel is lined with concrete from the upstream portal to downstream of the gate shaft. Gate operation is by hydraulic actuators. There is a bank of accumulators which can open each gate completely in the event of loss of all power. The gates discharge through a steel penstock 10.5 ft. in diameter which extends past the downstream portal of the tunnel. Two 28 inch diameter steel pipes encased in concrete extend through the entire length of the tunnel. these discharge through a system of 7 motor operated valves of different sizes so arranged that fish water releases can be made from the reservoir as necessary to maintain a flow in the Lower Bradley River of 100 cfs at Riffle Reach. Diversions into Bradley Lake As a part of the development of the Project, the Middle Fork of the Bradley River, a portion of the outflow from the Nuka Glacier, and a small tributary of Battle Creek were diverted into the reservoir. 2.8.1. Middle Fork Diversion 2.8:2 2.8.3 The Middle Fork Diversion is located approximately one mile north of Bradley Lake in an adjacent drainage at elevation 2160 on the Middle Fork Tributary of the Bradley River. The Diversion consists of a small intake basis and two reaches of open channel approximately 760 feet and 483 feet long, separated by a stilling basin which is located in a natural bog area, all of which were established by excavation. The Diversion conveys water from the Middle Fork of the Bradley River to Marmot Creek, a tributary to Bradley Lake, and operates in all seasons. Nuka Diversion Glacial melt forms a pond called Nuka Pool at the terminus of the Nuka Glacier. Nuka Pool lies on the divide between two drainage's, discharging water both into the Upper Bradley River and into the Nuka River. Water discharged into the Upper Bradley River flows to Bradley Lake and that which is discharged to the Nuka River flows to the Kenai Fijords National Park. The purpose of the Nuka Diversion is to cause the glacial melt water flowing through the Nuka Pool to flow in the upper Bradley River, except of an initial increment of flow which must be provided to the Nuka River in accordance with the June 1986 Contract between the Alaska Energy Authority and the U.S. Department of Interior. In compliance with this Contract, the design must assure that when flows are available in the Nuka Pool, 5 cfs will be diverted to the Nuka River prior to any diversion of water to the Upper Bradley River. To accomplish this, flow from the Nuka Pool to the Upper Bradley River passes over a long, uniform weir constructed by modifying the naturally occurring rock weir at the pool outlet. At the Nuka River outlet of the pool, water is constrained to flow through a 12-inch steel pipe in a gabion dike. This pipe has been sized such that it will discharge 5 cfs when the Nuka Pool level is at the elevation of the Bradley-side weir crest and flow is about to commence to the Upper Bradley River. No flow is allowed to enter the Upper Bradley River from the Nuka Pool until 5 cfs enters the Nuka River. A second, identical pipe is also provided. This second pipe ensures flows if the first pipe becomes inoperative and needs to be repaired. It may also be used to augment flows. Upper Battle Creek Diversion The Upper Battle Creek Diversion is located at elevation 1342 approximately 0.7 miles south-southeast of Bradley Lake Dam and A-8 2.9 2.10 2.11 2.12 diverts a small tributary of Battle Creek into the reservoir adding 0.9 square miles of drainage area to the Project. Diversion is accomplished by emplacement of a small, talus dike across the tributary at the base of a waterfall. An intake basin 25'x25' by 3 feet deep was constructed near the bottom of the falls and flow is directed through three interconnected ponds. Approximately 300 feet of ditch was excavated between the ponds to reverse the direction of the flow into the reservoir. Permanent Facilities To accommodate for the needs of on-site personnel, the project is provided with two 32'x82' duplex living quarters, a 43'x50' office/transient worker residence building, a 50'x160' shop-warehouse and a fenced storage yard which also contains an unheated storage/incinerator building. Project Airstrip The project airstrip is incorporated into the permanent project road system between the barge dock and permanent facilities. The strip is 2400 ft. long and 75 ft. wide and is equipped with plane lights, a taxi and parking apron, weather building and warning lights. The airstrip is designed for VFR use only and is not open to the public. Barge Dock Water access to the project is from a dock facility consisting of five (5) 53 ft. diameter sheet pile cells placed out into the tidal flats of Kachemak Bay. A rockfill, gravel-surfaced causeway extending some 700 ft. from the shoreline connects the barge dock cells to the project access road at the bay shore. Use of this facility is available only during half tides and greater. A small, aluminum floating dock is attached to the sheet pile cells to provide mooring for skiffs belonging to the public. This small dock is removed each winter to prevent it from being damaged by ice. Transmission Line Two parallel and separate single circuit 115 kV transmission lines, each about 20 miles long, connect to the substation at the powerhouse and carry the power generated to the Fritz Creek-Soldotna 115 kV A-9 3. 2.13 2.14 Transmission Line owned by Homer Electric Association, Inc. The point of connection for these two lines is designated as the Bradley Junction. The Bradley Lake transmission line towers are guyed, X-configuration towers manufactured of Corten type steel. The conductor is 556 kcmil, 42/19 Aluminum/Steel "Special Dove." Roads About 10.8 miles of gravel surface access roads have been constructed and connect the powerhouse, permanent facilities, airstrip, dam site and other project areas. Instrumentation Settlement and deflection of the main dam are monitored by two rows of monuments set on the upstream face at approximately mid-height of the face and just below the parapet; and three monuments set in the rock fill along the upstream side of the El 1077 berm. Three monuments are set in the crest of the spillway. Instrument pedestals were established along these several lines of monuments. The instrument pedestals are referenced to four primary survey monuments set in rock. Seepage into the spillway drainage gallery is collected and discharged over a vee notch weir. Main dam leakage is estimated by deducting fishwater releases and spillway seepage from the flow recorded at the USGS gaging station just downstream of the dam. Four exploratory borings along the line of the tunnel have been converted to open standpipe piezometers to measure groundwater levels above the tunnel. A strong motion seismograph has been installed on rock at the dam. This is linked by telephone to the Geophysical Institute of the University of Alaska at Fairbanks. All monitoring of earthquake vibration is done by the Institute. Seepage flow from the drain system around the steel lining in the tunnel is monitored in the powerhouse. INITIAL FILLING OF RESERVOIR Filling of the reservoir started October 30, 1990, but was suspended shortly thereafter to meet the fisheries minimum flow requirements. As the hydrograph began to rise the following spring, filling was resumed. The initial rate of filling was slow but accelerated during the summer of 1991. Water level reached full pool during a severe storm in late September 1991. Spilling started on September 27 and continued for 8 days with about 0.5 ft. depth passing over the A-10 spillway. The winds during this storm were heavy. Waves splashed over the spillway and to some extend over the parapet wall of the dam. These caused no damage. Measured deflections and settlements of the main dam during filling were very small, maximum displacements being: crest settlement 0.02 ft. displacement 0.03 downstream upstream face settlement 0.04 displacement 0.02 downstream downstream bench settlement 0.07 displacement 0.01 The settlement and deflection of the crest are only about 0.03% of the dam height. There was no detectable seepage through the dam. . POWER HOUSE STARTUP The units were turned over for pre-operational testing in March 1991. Unit 2 was first rotated on May 15, 1991, and Unit 1 on May 18, 1991. The units were released to Chugach Electric Association in Anchorage, Alaska for dispatch on August 1, 1991, and the plant declared in Commercial Operation on September 1, 1991. A-11 5. PROJECT LANDS On the basis of the project boundary shown in Exhibit G, the acreage of the lands belonging to the Unite States and State of Alaska are tabulated below. Asterisks (*) denote transmission line ROW acreage only. Description T.3S., R.10W. Tract A* Total Per Tp T.3S., R.11W. Section 23 Section 25 Section 26 Tract B* Total Per TP T.4S., R.QW. Section 30* Section 31* Tract A* U.S. Surv. 2937 Total Per TP T.4S., R.10W. Section 35 Section 36 Section 36* Tract A* Total Per TP T.5S., R.BW. Section 19 Section 20 Section 29 Section 30 Section 31 Total Per TP T.5S., R.QW. Section 3 Section 6 Section 7 Section 8 Section 9 Section 10 BLM Area Acres 45.74 0.33 46.07 149.14 75.94 40.17 265.25 388.74 93.63 6.04 139.40 316.24 944.05 40.00 5.64 121.12 267.30 29.21 210.59 State Area Acres 263.62 263.62 26.15 42.48 20.78 129.34 218.75 182.13 182.13 A-12 Other Acres 12.73 12.73 14.36 14.36 Water Acres 2.79 2.79 4.00 4.00 100.71 166.96 170.10 Subtotal Acres 263.62 218.75 240.93 279.61 944.05 Description Section 11 Section 14 Section 15 Section 16 Section 17 Section 18 Section 22 Section 23 Section 24 Section 25 Section 26 Section 36 Total Per TP T.5S., R.10W. Section 1 Section 2 Section 3 Section 9 Section 10 Section 11 Section 12 Section 13 Section 14 ATS 1418 Total Per TP T.6S., R.BW. Section 6 Total Per TP Total Proj. Area Including Transmission Line Transmission Line Area Only BLM Area Acres 5.67 168.73 32.28 69.46 31.37 3.97 66.32 513.20 558.08 372.53 15.07 15.46 2,425.17 26.81 128.83 384.89 127.87 398.57 222.79 64.41 41.59 1.56 1,397.32 320.00 320.00 5,498.69 86.24 State Area Other Acres Acres 23.21 84.35 208.39 139.39 139.39 925.81 12.73 407.32 A-13 Water Subtotal Acres Acres 0.94 232.80 548.73 145.42 16.63 67.64 35.77 1,485.70 2,633.56 1,536.71 320.00 1,492.49 Dam: Spillway: Power Tunnel: Diversion Tunnel: Table A-1 Bradley Lake Hydroelectric Project Data Concrete-faced rockfill, 600 feet long, 125 feet high, 360,000 cubic yards rockfill, and 10,800 cubic yards concrete Ungated concrete ogee section, 175 feet long (11,000 cubic yards concrete) 13-foot nominal diameter, fully concrete lined, approximately 19,152 feet in length 21-foot horseshoe concrete lines/penstock tunnel, 407.5 feet long Penstock: Steel, 9-foot diameter with Annual Firm Energy: Average Annual Energy: Transmission Line: Barge Dock: Access Roads: 329 gigawatt hrs 376 gigawatt hrs 115 kilovolt, two Sheet pile cells granular fill 10.8 miles, gravel 6 1/2 foot diameter branches Middle Fork Diversion: 1517 foot diversion includes Powerhouse: Surface, steel upper and lower channels with superstructure, intake basin and stilling basin 160 feet long, 80 feet wide, 92 feet high Nuka Diversion: 2 diversion and control dikes, Turbines: 2 each Pelton, pilot channel and outlet weir vertical shaft, 90,170 horsepower max. Battle Creek 300 foot diversion channel Generators: 2 each Rated Diversion: with intake basin, talus output at max. diversion weir operating pool is 63 MVA. Airstrip: Gravel surface airstrip Governors: 2 each Woodward 2,400 ft. long by 75 feet wide incorporated into access road A-14 digital EXHIBIT "B" BRADLEY LAKE PROJECT SPECIFIC FEDERAL AND STATE AGENCY REQUIREMENTS Dept. of Environmental Conservation (DEC) Dept. of Environmental Conservation (DEC) Corps of Engineers (COE) Corps of Engineers (COE) Corps of Engineers (COE) Corps of Engineers (COE) Corps of Engineers (COE) Corps of Engineers (COE) Dept. of Fish & Game (DFG) Dept. of Fish & Game (DFG) Dept. of Fish & Game (DFG) Approval to Operate Class "C" Water System Permit date 11/4/88 Permit date 04/3/89 Waiver Approval 5/23/91 Certificate to Construct Class "C" Water System Land Use License DACW85-3-91-88 Land Use License DACW85-2-90-24 Dredge and Fill Permit #071-OYD-2-850502 Plus seven modifications Land Use License DACW85-3-86-55 Land Use License DACW85-3-86-73 Land Use License DACW85-3-86-101 Critical Habitat Area _ FG 88-II-0077 Special Area Permit FG 86-II-0824 Anadromous Fish Stream, Critical Habitat Area FG 86-II-0416 Plus Amendment IV Exhibit "B" Bradley Lake Project Specific Approval to operate permanent facilities -- Public water system and wastewater disposal system. Approval to operate permanent facilities -- Powerhouse Creek Source. Waiver Approval, Class "C" Water Well. Certificate to construct potable water system at Bradley Lake Powerhouse. Approval to Operate was requested 2/4/92 -- No response as of yet. COE land use license to construct and operate the upper Battle Creek Diversion Dam. Land use license for gauging station electrical distribution line. Section 10 - Perform work in or affecting US. navigable waters.Section 404 - Discharge dredged or fill material into U.S. waters. Extension of land use license to allow for material extraction. Extension of land use license for area used as access road and construction landfill. Land use license to conduct studies and design project. Road Construction Kachemak Bay Critical Habitat Area Airstrip Construction and Operation Transmission Line Construction Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. Dept. of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Fish & Game (DFG) of Natural Resources(DNR) of Natural Resources(DNR) of Natural Resources(DNR) of Natural Resources(DNR) of Natural Resources(DNR) of Natural Resources(DNR) Critical Habitat Area FG 86-II-0115 Critical Habitat Area FG 86-II-0114 Plus Amendment I Anadromous Fish Stream Critical Habitat Area FG 86-II-0113 Plus two amendments Critical Habitat Area FG 86-II-0112 Plus Amendment II Anadromous Fish Stream FG 86-11-0110 Plus Amendment II Critical Habitat Area FG 86-II-0108 Critical Habitat Area FG 86-II-0107 Plus Amendment I Anadromous Fish Stream FG 86-II-0106 Plus Amendment II Critical Habitat Area FG 85-11-0824 Plus one amendment Water Rights LAS 13370 Permanent Water Rights LAS 6998 Water Rights Application LAS 14316 Permanent Water Rights LAS 2837 Public and Charitable Lease ADL 225142 Permanent Water Rights LAS 2836 Exhibit "B" Bradley Lake Project Specific Powerhouse to Lower Camp Access Road Airstrip to Powerhouse AccessRoad Martin River material site access road, Battle Creek. Spoil Disposal/Waterfowl Nesting Area Martin River material site, Martin Barge dock and staging area. Powerhouse and switchyard construction and operation. Bradley River Dam, Bradley. Airstrip construction and operation. Water rights for Upper Battle Creek Diversion Project. Permit to use permanent facilities Well No. 4 for 5 additional years. Bradley Lake Waterfowl Nesting Area Appropriate water for waterfowl nesting area. Lease of State Lands near Fritz Creek for Moose Mitigation. Appropriate water from Middle Fork and Nuka Glacier Pool Dept. of Natural Resources(DNR) Dept. of Natural Resources(DNR) Dept. of Natural Resources(DNR) Dept. of Interior (DOI) Federal Energy Regulatory Commission (FERC) Federal Energy Regulatory Commission (FERC) Federal Energy Regulatory Commission (FERC) Federal Energy Regulatory Commission (FERC) Federal Energy Regulatory Commission (FERC) Federal Energy Regulatory Commission (FERC) Right-of-Way ADL 223192 Uplands Lease ADL 222656 Tidelands Lease Contract FERC License Amendment FERC License Amendment FERC License Amendment FERC License Amendment FERC License FERC License Amendment Exhibit "B" Bradley Lake Project Specific Final documents issued. Final documents issued. Final documents issued. Provisions for water from Nuka Glacier Pool. To construct and operate Upper Battle Creek Diversion Project. To adopt modified flow regime during reservoir filling. For relocation of permanent landing strip To adopt modified operational flow regime to be consistent with ADF&G flow regime. FERC order issuing license Order granting extension until January 1, 1992 to complete project construction EXHIBIT "C" INSURANCE Lc Contractor to purchase/maintain insurance for duration of agreement, plus one year following final payment. 2: Specified limits are minimum levels. If the policy contains higher limits, contracting agency is entitled to coverage of higher limits. 5 Certificate of insurance must be furnished to contracting agency. ¢ Must provide for 30-day prior notice to the contracting agency of cancellation, reduction in liability. e Failure to furnish constitutes material breach and grounds for termination. Types of Insurance Worker's Compensation: Contractor responsible for subcontractors. Coverage must include statutory coverage for states where employees are engaging in work and employer's liability protection not less than $100,000 per person, $100,000 per occurrence. Where applicable, coverage for all federal acts must also be included. Comprehensive of Commercial General Liability Insurance: Covers all operations of contractor providing insurance for bodily injury and property damage liability including coverage for: e Premises and Operations e Products and Completed Operations ¢ Broad Form Damage; and ¢ Personal Liability Comprehensive Policy: Minimum combined single limit of liability is $300,000 per occurrence, $300,000 aggregate for bodily injury, property damage and personal injury. Commercial Policy: Minimum limits of liability are $300,000 per occurrence (combined single limit) for bodily injury and property damage, $300,000 per occurrence for personal injury, $300,000 aggregate for products-completed operations, and $300,000 general aggregate. Comprehensive Automobile Liability Insurance: Covers all owned, hired, and non-owned vehicles with coverage limits not less than $100,000 per occurrence bodily injury and $50,000 property damage. Professional Liability Insurance: Covers all negligent errors, omissions which the contractor, subcontractor or their employees make in the performance of the agreement which results in financial loss to the contracting agency. Minimum Limits: Combined Single Limit Contract Amount Occurrence and Annual Aggregate Under $100,000 $100,000 $100,000 to $499,999 $250,000 $500,000 to $999,999 $500,000 $1,000,000 and up NEGOTIABLE Contracting agency reserves right to implement an Owner Controlled Insurance Program with option of obtaining Professional Liability Insurance, contractor isn't required to carry Professional Liability Insurance. EXHIBIT C Page 2 of 2 EXHIBIT "D" EXHIBIT A OF THE MASTER OPERATING AGREEMENT To be added after approval of the Master Operating Agreement by the BPMC and its execution by the BPMC and the Authority. Date From: To Subject: Chugach Electric Association Inc. Memorandum March 29, 2005 Brian Hickey, Director Transmission Technical Services Bradley Operations and Dispatch Subcommittee Risk Adjusted Estimate of Avoided Cost For the Bradley Lake Runner Replacement EPRI’s methodology for evaluating avoided costs is based on a survey of substation failure statistics at approximately 23 utilities nationwide. Failures were ranked as worst possible, most possible and most probable. This failure database is limited to substation equipment failures, and do to the “rotating equipment” aspect of Pelton turbines these data probably represent a conservative proxy to actual Pelton turbine failure data. Based on statistical analysis of the substation failure database the following weighted likely hood for each scenario was determined. e Likelihood of worst possible occurrence 0.1% e Likelihood of most possible occurrence 10.0% e Likelihood of most probable occurrence 89.9% The following are the potential failure modes for the project in the event that one of the runners throws a single or multiple buckets. So long as needle disintegration or complete multiple power nozzle failures do not occur damage is limited to the turbine pit and runners. In the event that turbine pit damage results in either a water hammer, which explodes the elbow at the top tunnel bend, or water column separation, which results in tunnel collapse, significant tunnel re-work, will need to be accomplished. In 1990, Stone and Webster calculated the tunnel replacement cost at $100M the PV at 3% is 1.8 B. This seems unrealistic so the 1990 replacement cost is doubled for this analysis. Probable Failure Case Rice “New Runner $1,500,000 Repair Nozzle $200,000 epair Chamber $300,000 _ Alternate fuel ource $800,000 30% $840,000 $3,640,000 Possible Failure & OS Case Failed Equipment ieee Reece Bi j ee $1,500,000 Repair Nozzle $100,000 epair Chamber $100,000 Alternate fuel ource $2,400,000 epair otor/Stator $1,400,000 30% $1,230,000 $6,730,000 Worst Possible Failure Case Failed Equipment Rue Repait Casi Bu ‘ailure ew Runner $1,500,000 : ; ew Tunnel $200,000,000 epair -Rotor/Stator $1,400,000 epair Nozzle $100,000 epair Chamber $500,000 Iternate fuel source $19,200,000 30% $66,810,000 $289,510,000 an ae Pose B Applying the weighted probabilities to the estimated repair costs for the various Bradley Lake facilities yields an avoided cost of runner replacement of: Avoided Cost Calculation Repair Cost YWeiuhted Probability Failure mode Uns: Ww $289,510,000 0.10% $289,510 $6,730,000 10.00% $673,000 $3,640,000 89.90% $3,272,360 $4,234,870 Date From: To Subject: ( “Tale, 1) Chugach Electric Association Inc. Memorandum March 29, 2005 Brian Hickey, Director Transmission Technical Services Bradley Operations and Dispatch Subcommittee Risk Adjusted Estimate of Avoided Cost For the Bradley Lake Runner Replacement EPRI’s methodology for evaluating avoided costs is based on a survey of substation failure statistics at approximately 23 utilities nationwide. Failures were ranked as worst possible, most possible and most probable. This failure database is limited to substation equipment failures, and do to the “rotating equipment” aspect of Pelton turbines these data probably represent a conservative proxy to actual Pelton turbine failure data. Based on statistical analysis of the substation failure database the following weighted likely hood for each scenario was determined. e Likelihood of worst possible occurrence 0.1% e Likelihood of most possible occurrence 10.0% e Likelihood of most probable occurrence 89.9% The following are the potential failure modes for the project in the event that one of the runners throws a single or multiple buckets. So long as needle disintegration or complete multiple power nozzle failures do not occur damage is limited to the turbine pit and runners. In the event that turbine pit damage results in either a water hammer, which explodes the elbow at the top tunnel bend, or water column separation, which results in tunnel collapse, significant tunnel re-work, will need to be accomplished. In 1990, Stone and Webster calculated the tunnel replacement cost at $100M the PV at 3% is 1.8 B. This seems unrealistic so the 1990 replacement cost is doubled for this analysis. Probable Failure Case Possible Failure Case Worst Possible Failure Case Repair oe rs $1,500,000 Repair Nozzle $200,000 Repair Chamber $300,000 Iternate fuel ource $800,000 30% $840,000 $3,640,000 Failed Equipment ee Buc’ ilure _ New Runner $1,500,000 Repair Nozzle $100,000 _ Repair Chamber $100,000 Iternate fuel ource $2,400,000 _ Repair _ Rotor/Stator $1,400,000 30% $1,230,000 $6,730,000 Riel teee Se)! New Runner $1,500,000 New Tunnel $200,000,000 Repair ~ Rotor/Stator $1,400,000 Repair Nozzle $100,000 Repair Chamber $500,000 lternate fuel ource $19,200,000 30% $66,810,000 $289,510,000 Applying the weighted probabilities to the estimated repair costs for the various Bradley Lake facilities yields an avoided cost of runner replacement of: Avoided Cost Calculation Repair Cost Weighted Probability Failure mode Ue lene $289,510,000 0.10% $289,510 $6,730,000 10.00% $673,000 $3,640,000 89.90% $3,272,360 $4,234,870 Alaska Industrial Development and Export At y Alaska Energy Authority BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING AGENDA Thursday, March 31, 2005 — 10:00 a.m. (Via electronic media at AIDEA/AEA — 813 W. Northern Lights Boulevard) (Corner of Arctic and Northern Lights Boulevard) Me CALL TO ORDER Haagenson 2. ROLL CALL (for Committee members) 3. PUBLIC ROLL CALL (for all others present) 4. PUBLIC COMMENT 5. AGENDA COMMENTS 6. APPROVAL OF MEETING MINUTES November 18, 2004 7. NEW BUSINESS A. Approve Utilities’ FY04 Deficit Repayment to the Project Cunningham B. Approve FY05 Budget Changes to Increase Expenses for the Property Valuation & R&C Fund Repayment Cunningham Cc. Approve June 2005 Transfer from the Revenue Fund to the R&C Fund Cunningham D. Approval of FY06 Budget Cunningham E. HEA O&M Contract Extension Term Stead/Copoulos rh Turbine Runner Replacement — Risk Analysis, FUJI Contracts, & Replacement Recommendations Audit Approval Stead/Hickey/Copoulos 8. COMMITTEE REPORTS / COMMENTS A. Operators Report it: Governor Project Status Stead 2. Budget Committee Report/Appraisal Audit Update Cunningham B. Next Meeting Date Haagenson 9. ADJOURNMENT 813 West Northern Lights Boulevard * Anchorage, Alaska 99503 907 / 269-3000 * FAX 907 / 269-3044 * Toll Free (ALASKA ONLY) 888 / 300-8534 * www.aidea.org BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE F/Y 2005 Amended Budget Summary of expense changes from F/Y 2005 original - $75,000 increase for the Bradley Lake Project Appraisal. - $540,401 increase to replenish the “R&C” fund to the $5,000,000 level for runner replacement in subsequent fiscal years. - $15,000 increase for Operating Reserve transfer (required to be 20% of budgeted operating expense). - $3,275 decrease to Debt Service (to equal actual F/Y 2005 amount). - $27,782 increase for Arbitrage Transfer (to equal actual F/Y 2005 amount). Other points - Repays the F/Y 2004 deficit of $73,492. - Proposes to collect an additional $697,850 over the final 2 months of the fiscal year (27% increase in May and June 2005). BRADLEY LAKE HYDROELECTRIC PROJECT Schedule A AMENDED > INC(DEC) FY03 FY2004 FY2005 INC(DEC) | FROM ACTUALS ACTUALS BUDGET FROM PY REVENUES, EXPENSES & CHANGES IN SURPLUS. REVENUES UTILITY CONTRIBUTIONS- 14,409,226 14,759,083 16,030,046 J 1,270,963 |} 15,332,200 INTEREST INCOME 1,840,740 1,559,318 1,552,323 (6,995) J 1,595,262 REPAY PRIOR YEAR DEFICIT 0 0 0 0 0 MISCELLANEOUS INCOME 2,680 0 oO 0 0 16,252,646 16,318,401 17,582,369 | 1,263,968 | | 16,927,462 EXPENSES e OPERATIONS 2,316,682 3,299,790 3,284,811 (14,979) J 3,209,814 RENEWALS/REPLACEMENTS (R&C FUND REPAYMENT: 321,021 493,525 1,581,725 | 1,088,200 © | 1,041,324 REPLACE TRANSMISSION RELAYS 200,000 200,000 200,000 PURCHASE NEW VEHICLE 29,130 11,067 0 (11,067) 0 TRANSFER TO OPERATING RESERVE 0 111,400 15,000 (96,400) 0 DEBT SERVICE (net of Capital Reserve Reductions) 12,268,075 12,273,400 12,273,050 (350) 12,276,325 ARBITRAGE TRANSFER 163,420 202,711 227,782 25,071 | | 200,000 PRIOR YEARS SURPLUS (DEFICIT) 2,013,381 (73,492) (2,086,873) ~ (73,492) 15,098,329 18,405,275 17,508,877 (896,398) "| 16,853,971 CURRENT YEAR SURPLUS (DEFICIT) 1,154,317 (2,086,874) BEGINNING SURPLUS (DEFICIT 859,064 2,013,381 ENDING SURPLUS (DEFICIT) 2,013,381_ (73,492)} BALANCE SHEET ASSETS REVENUE FUND 1,759,535 (0) OPERATING FUND 684,300 294,998 RECEIVABLES LIABII PL LIABILITIES 433,143 SURPLUS (DEFICIT) 2,013,381 2,446,524 OTHER INFORMATION OPERATING RESERVE * 535,000 646,400 MONTHLY CONTRIBUTIONS 1,200,768 1,594,243 1,335,837 * Required to be 20% of budgeted operating expense 3/16/20058:30 AMH:\ALL\Imacmillan\BradleyLake\F YOSBRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xisSchedule A-Budget Summary BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET SUMMARY (A) HEA Annual Operations & Maintenance 1,062,700 962,284 100,416 1,216,500 1,198,460 1,166,649 (B) CEA Dispatch and Substation/SVC Maintenance 68,000 41,634 26,366 73,000 57,090 70,000 (C) Other O&M and Maintenance Projects 446,736 382,361 64,375 812,276 880,566 766,162 (D) Insurance Costs 435,000 509,488 (74,488) 610,000 677,601 725,000 (E) Regulatory Costs 217,500 174,687 42,813 245,630 196,835 182,500 (H) Contingencies 0 0 0 0 0 100,000 2,229,936 2,070,455 159,481 2,957,406 3,010,553 3,010,311 (F) Administrative Costs 244,500 246,228 (1,728) 274,500 289,237 274,500 2,474,436 2,316,682 157,754 3,231,906 3,299,790 3,284,811 (G) Bond Refunding Costs 0 0 0 0 0 0 2,474,436 2,316,682 157,754 3,231,906 3,299,790 3,284,811 Page 2 of 9 3/16/2005 8:30 AM H:\ALL\Imacmillan\BradleyLake\FYOS5BRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FERC 535 - Operation Supervision & Engineering (A) HEA O&M Contract (C) HEA On-Site Civil Project Manager (C) HEA Digitize & Control Project Drawings FERC 537 - Hydraulic Expenses (A) HEA O&M Contract FERC 538 - Electric Expenses (A) HEA O&M Contract (A) SOA BOILIER INSPECTION FERC 539 - Misc. Hydraulic Power Generation Expenses (A) HEA O&M Contract (C) Replace Two Way Radios FERC 540 - Rents (A) HEA O&M Contract (C) Other (A) HEA O&M Contract (C) Bradley Lake Dam Repair (C) Nuka Diversion (C) Middle Fork Diversion Page 3 of 9 30-Jun-04 FY2003 FY2003 FY2004 FY2004 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL 94,200 146,889 (52,689) 192,800 130,716 0 0 23,732 0 0 45,840 94,200 146,889 (52,689)| 192,800 200,289 19,600 4,705 14,895 39,900 3,900 AMENDED FY2005 BUDGET 122,828 122,828 (C) DIS Voice/Data Circuits (inc. space & power) (C) DIS 2-way Radio Circuits & radio maint. (C) HEA Circuits and Radio - To Bernice Lake (C) CEA Circuits -Bernice Lake to Anchorage 19,600 4,705 14,895 39,900 3,900 354,100 171,736 182,364 63,800 197,032 0 0 1,710 354,100 171,736 182,364 63,800 198,742 148,100 201,340 (53,240) 210,900 210,566 0 10,000 0 10,000 10,000 7,000 0 7,000 7,000 0 90,000 90,000 0 90,000 90,000 28,746 28,746 0 28,746 28,746 320,086 (36,240) 346,646 329,312 (C) Bradley Lake FERC land use fees (5% increase bi FERC 542 - Maintenance of Structures FERC 543 - Maintenance of Reservoirs, Dams & Waterways 34,628 41,372 108,000 100,220 34,628 41,372 108,000 100,220 32,442 6,558 35,300 10,453 0 0 0 0 32,442 35,300 10,453 5,100 19,142 (14,042) 62,000 2,235 160,000 152,640 125,134 0 0 20,000 0 3/16/2005 8:30 AM H:\ALL\Imacmillan\BradleyLake\FYO5BRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B (C) Kachemak Creek Gauging Station (C) Other O&M FERC 544 - Maintenance of Electric Plant (A) HEA O&M Contract (A) HEA O&M Contract-Runner Repairs FERC 545 - Maintenance of Misc. Hydraulic Plant (A) HEA O&M Contract (C) Martin River Road Study-Amendment & Removal FERC 556 - System Control & Load Dispatching (A) HEA O&M Contract (C) NOAA Weather Service (C) SCS Snow Measurement (C) UAA Seismic monitoring and reporting (C) USGS Streamguaging (C) State of Alaska Permits FERC 562 - Station Expenses (B) CEA SVC/Substation Maintenance Contract (C) SVC Condition Assessment/Staff Training FERC 571 - Maintenance of Overhead Lines (A) HEA Overhead Line Maintenance (H) Contingencies FERC 920 - Administrative Expense (F) AEA Admin Fee AEA Administrative Costs 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET 0 0 26,000 0 26,000 20,244 5,100 19,142 (14,042)| 268,000 300,253 51,278 284,000 283,275 725 368,400 342,669 276,741 0 0 41,080 0 284,000 283,275 725 | 368,400 383,749 276,741 92,000 81,286 10,714 210,600 153,066 282,169 0 0 0 110,000 51,382 30,000 92,000 81,286 10,714 320,600 204,447 312,169 6,000 12,384 (6,384) 12,200 74,428 23,315 7,040 0 7,040 7,040 0 0 29,450 30,673 (1,223) 41,990 38,278 30,000 56,500 56,500 0 56,500 56,500 56,500 142,000 141,690 310 147,000 146,040 205,916 0 125 (125) 0 100 0 240,990 241,372 (382) 264,730 315,346 315,731 68,000 41,634 26,366 73,000 57,090 70,000 0 0 200,000 68,000 41,634 26,366 73,000 57,090 270,000 | 20,600 9,083 11,517 20,600 32,316 62,624 20,600 9,083 11,517 20,600 32,316 62,624 J |__ 0 0 0 0 0 100,000 | 200,000 200,000 0 200,000 200,000 200,000 200,000 200,000 0 200,000 200,000 200,000 3/16/2005 8:30 AM Page 4 of 9 H:\ALL\Imacmillan\BradleyLake\FYOSBRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B 30-Jun-04 AMENDED FY2003 FY2003 FY2004 FY2004 FY2005 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET PMC Costs (F) Bradley Lake Audit fees 8,500 6,540 1,960 8,500 7,898 8,500 (F) Bradley Lake PMC Legal 10,000 16,093 (6,093) 40,000 57,945 40,000 (F) Bradley Lake PMC JAA Activities 0 0 0 0 ) ) (F) Bradley Lake Arbitrage Report 6,000 6,000 0 6,000 5,800 6,000 (F) Bradley Lake Trustee fees 20,000 17,595 2,406 20,000 17,595 20,000 PMC Costs 44,500 46,228 (1,728) 74,500 89,237 74,500 Bond Refunding Costs Reimburseable costs Refunding Costs 0 0 0 0 0 0 TOTAL FERC 920 244,500 246,228 (1,728) 274,500 289,237 L 274,500 FERC 924 - Property Insurance (D) Insurance Premiums 405,000 456,729 (51,729) 555,000 547,895 590,000 (D) Homer Electric Insurance 30,000 52,759 (22,759) 30,000 57,972 60,000 (D) Risk Assessment 0 0 0 25,000 71,734 75,000 435,000 509,488 (74,488) 610,000 677,601 725,000 FERC 928 - Regulatory Commission Expenses (E) FERC administrative fees 106,000 114,214 (8,214) 150,000 44,424 126,000 (E) FERC Instrumentation Data Collection 26,812 (26,812) 57,687 (E) Seismic Survey Spillway 0 0 18,771 (E) Contractual Engineer - FERC license issues 31,500 15,617 15,883 31,500 3,816 31,500 (E) Spillway Seepage Water and Pressure Study 80,000 18,043 61,957 64,130 72,137 25,000 217,500 174,687 42,813 245,630 196,835 182,500 TOTAL BRADLEY LAKE BUDGET 2,474,436 2,316,682 157,754 3,231,906 3,299,790 3,284,811 3/16/2005 8:30 AM Page 5 of 9 H:\ALL\lmacmillan\BradleyLake\FYOSBRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xlsSchedule B-Budget Detail BRADLEY LAKE MONTHLY UTILITY CONTRIBUTION SCHEDULE C POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC CITY OF SEWARD POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC CITY OF SEWARD COMPONENTS OF CHANGE IN CONTRIBUTION FY2004 ANNUAL CONTRIBUTION Revenue Changes INCREASE) DECREASE IN BUDGETED INTEREST EARNINGS Expenditure Changes INCREASE (DECREASE) IN BUDGETED O&M COSTS INCREASE (DECREASE) IN PAYBACK TO R&C FUND INCREASE (DECREASE) TRANSMISSION RELAYS REPLACEMENTS INCREASE (DECREASE) VEHICLE PURCHASE INCREASE (DECREASE) IN DEBT SERVICE INCREASE (DECREASE) IN EXCESS EARNINGS TRANSFER INCREASE (DECREASE) IN OPERATING RESERVE TRANSFER Other IMMATERIAL ROUNDING DIFFERENCES FY2005 ANNUAL CONTRIBUTION PERCENT FY2003 FY2004 FY2005 FY2005 SHARE TOTAL TOTAL TOTAL INCREASE 30.4% 4,380,398 4,509,110 4,873,142 364,032 25.9% 3,731,990 3,841,634 4,151,784 310,150 25.8% 3,717,578 3,826,802 4,135,752 308,950 16.9% 2,435,162 2,506,706 2,709,072 202,366 1.0% 144,098 148,322 160,296 11,974 100.0% 14,409,226 14,832,574 16,030,046 1,197,472 FY2003 FY2004 PERCENT MONTHLY MONTHLY FY2005 FY2005 SHARE AVERAGE AVERAGE MONTHLY INCREASE 30.4% 365,033 375,759 406,094 30,335 25.9% 310,999 320,136 345,982 25,846 25.8% 309,798 318,900 344,646 25,746 16.9% 202,930 208,892 225,756 16,864 1.0% 12,008 12,360 13,358 998 100.0% 1,200,768 1,236,047 1,335,836 99,789 Revised 14,832,574 6,995 (14,979) 1,088,200 200,000 (11,067) (350) 25,071 (96,400) 2 NET INCREASE(DECREASE) 1,197,472 16,030,046 0 No. of Months 10 2 12 FYO5PAID FYOS5TOPAY TOTAL ORIGINAL REVISED deficit repay BUDGET BUDGET BUDGET 3,884,160 988,982 4,873,142 22,341.57 3,309,200 842,584 4,151,784 19,034.43 3,296,420 839,332 4,135,752 18,960.94 2,159,280 549,792 2,709,072 12,420.15 127,770 32,526 160,296 734.92 1,197,472 12,776,830 3,253,216 _ 16,030,046 73,492.00 MONTHLY MONTHLY 388,416 494,491 330,920 421,292 329,642 419,666 215,928 274,896 12,777 16,263 1,197,468 99,789 1,277,683 1,626,608 Original 14,759,089 (36,222) (22,092) 553,596 200,000 (11,000) 2,925 (2,711) (111,400) 16 573,112 15,332,201 3/16/20058:30 AM H:\ALL\imacmillan\BradleyLake\F YOSBRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule C Utility Contrib BRADLEY LAKE R&C FUND DISBURSEMENTS AND REPAYMENTS SCHEDULE D ACTUAL Disburse 890,667.09 27,719.72 262,253.24 103,444.32 Description Needle repairs Runner repairs ace Runners =R REIMB Ending Balance $ _1,284,084.37 ACTUAL ACTUAL TO REPAY at 06/30/03 668,000.32 20,789.79 196,689.93 77,583.24 Repay (222,666.77) (6,929.93) (65,563.31) (25,861.08) $ (321,021.09) $ 963,063.28 ACTUAL Disburse 587,046.30 78.76 367.10 132,182.58 $ 719,674.74 ACTUAL R&C Interest (291,047.00) $ (291,047.00) $ (493,525.39) $ ACTUAL Repay (369,428.35) (6,949.62) (65,655.09) (58,906.73) 7,414.39 Balance in R& C Fund June 30 RECAP-GOVERNOR PROJECT REVISED-03/14/05 MONTH CONST FUND ACTUAL FY03 0.00 FY04 0.00 ‘otal as of 30June2004 0.00 PROJECTED December-04 510,000.00 March-04 1,070,784.00 April-OS 119,216.00 June-05 0.00 FY05 Additions 1,700,000.00 July-05 0.00 August-05 0.00 September-05 0.00 FY06 Additions 0.00 Total Cost of Project 1,700,000.00 R&C FUND TOTAL 103,444.22 132,182.58 235,626.80 103,444.22 132,182.58 235,626.80 0.00 0.00 510,000.00 1,070,784.00 119,216.00 680,000.00 2,380,000.00 560,000.00 325,000.00 475,000.00 1,360,000.00 3,975,626.80 0.00 ACTUAL TO REPAY at 06/30/04 594,571.27 13,918.93 131,401.95 150,859.10 7,414.39 898,165.63 $_4,101,834.37 $ _5,000,000.00 $ PROJECTED PROJECTED Disburse Repay (594,571.27) (13,918.93) (131,401.95) 683,559.79 (834,418.89) (7,414.39) 683,559.79 $ (1,581,725.43) PROJECTED TO REPAY PROJECTED Disburse 1,360,000.00 95,888.00 PROJECTED PROJECTED TO REPAY Repay (1,360,000.00) (95,888.00) $ (0.00)] $_1,455,888.00 $ (1,455,888.00) $ $ _5,000,000.00 $ _5,000,000.00 PROJECTED PROJECTED PROJECTED TO REPAY Repay (2,600,000.00) 3/16/20058:30 AM H:\ALL\Imacmillan\BradleyLake\FY OSBRADLEY\2005BradleyBdgt-O3MARO5RepayR&C100%.xlsSchedule D R&C Disb & Repay BRADLEY LAKE BUDGET ACTIVITY BY ACCOUNT SCHEDULE G Rev Fund O&M Fund Debt Fund Op Reserve R&C Cap Reserve Total 6/30/2003 Actual Balance 1,759,535 684,300 8,676,539 535,000 4,036,938 12,834,000 28,526,312 A (0) 23% of Annual O&M Budget FY2004 Budget - Revenues 14,759,083 14,759,083 Interest 1,559,259 60 291,047 1,850,365 Transfers to O&M (3,351,579) 3,351,579 - - Transfers to Debt Service (12,273,400) 12,273,400 7 Transfers to Revenue Fund 5,562 (5,562) - Payback of R&C Fund (242,368) (251,157) 493,524 - FY03 O&M Requisitions (61,965) (61,965) FY04 O&M Reauisitions (3,299,790) - (3,299,790) Renewals/Replacements - (719,675) - (719,675) To Excess Earnings fund (202,711) (202,711) Snowmachines (11,067) (11,067) Refund of prior year surplus (2,013,381) (2,013,381) Debt Payments (20,949,939) (20,949,939) Increase Op Reserve (111 400) 111,400 - 6/30/2004 Actual Balance (0) 294,998 0 646,400 4,101,834 12,834,000 17,877,232 A 20.001% of Annual O&M Budget FY2005 Budget : Revenues 16,030,046 - 16,030,046 Interest 1,552,323 1,552,323 Transfer back interest - - Transfers to O&M (3,284,811) 3,284,811 - - Transfers to Debt Service (12,273,050) 12,273,050 - Payback of R&C Fund (1,581,725) 1,581,725 - 2004 O&M Requisitions (368,490) (368,490) 2005 O&M Reauisitions (3,284,811) (3,284,811) 2005 Capital Requistions (200,000) 200,000 - i. Renewals/Replacements (200,000) - (683,560) - (883,560) To Excess Earnings fund (227,782) (227,782) Payment of Prior Year Deficit 73,492 73,492 Debt Payments (12,273,050) (12,273,050) Increase Op Reserve (15,000) 15,000 : 6/30/2005 Projected Balance 0 0 0 661,400 5,000,000 12,834,000 18,495,401 Assumption: x For purpose of budget cash flows, July 01 debt service should be 20.00% of Annual O&M Budget is assumed to be disbursed on June 30 projected 20.14% 3/16/20058:30 AM H:\ALL\Imacmillan\BradleyLake\FYOSBRADLEY\2005BradleyBdgt-O3MAROSRepayR&C100%.xisSchedule G-Cash balances PROJECTED INTEREST INCOME SCHEDULE | TOTAL Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 OTHER ADJ Beginning Balance 17,877,232.00 17,877,232.00 19,855,200.66 20,933,048.73 21,367,800.96 22,319,983.25 23,597,807.17 24,739,520.55 23,163,988.26 24,065,636.38 24,967 ,284.50 25,668,932.61 26,992,997.73 27,563,570.85 Receipts Utility Contributions 16,030,046.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,277,683.00 1,626,608.00 1,626,608.00 Interest Income Received 1,552,323.45 928,065.00 175.46 47.02 53.14 140.72 120.04 722,867.22 0.00 0.00 0.00 0.00 0.00 (99,145.15) ADJ INT TO Repay Prior Year Deficit 73,492.00 73,492.00 ACCRUED 17,655,861.45 2,205, 748.00 1,277,858.46 1,277,730.02 1,277,736.14 1,277,823.72 1,277,803.04 2,000,550.22 1,277,683.00 1,277,683.00 1,277,683.00 1,700,100.00 1,626,608.00 (99,145.15) Disbursements Ending Cash in O&M Fund (368,490.00) 2.22 (200,010.39) (168,481.83) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 O &M Expenses (3,284,811.40) 0.00 0.00 (670,936.17) (325,553.85) 0.20 (136,089.66) (272,057.51) (376,034.88) (376,034.88) (376,034.88) (376,034.88) (376,034.88) R&C Fund Disbursement (683,559.79) (3,559.79) 0.00 (680,000.00) Debt Service Payment (12,273,050.00) (3,304,025.00) (8,969,025.00) ASSUME LOAN Capital Requisitions (200,000.00) (200,000.00) PD JUNE 30 Excess Earnings Transfer (227,781.56) (227,781.56) Adjustment-Equal Sch G 0.00 (17,037,692.75) (227,779.34) (200,010.39) (842,977.79) (325,553.85) 0.20 (136,089.66) (3,576,082.51) (376,034.88) (376,034.88) (576,034.88) (376,034.88) (1,056,034.88) _(8,969,025.00) Adjust to Actual 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Ending Balance 18,495,400.70 _19,855,200.66 _20,933,048.73 _21,367,800.96 22,319,983.25 23,597 ,807.17 24,739,520.55 23,163,988.26 24,065,636.38 24,967,284.50 25,668,932.61 26,992,997.73 27,563,570.85 _18,495,400.70 Interest Income Projection Estimated Accrued Interest 1,552,323.45 108,210.84 113,910.67 116,276.45 121,457.91 128,411.40 134,624.22 126,050.70 130,957.17 135,863.64 139,681.77 146,886.90 149,991.76 Adjust to Actual Received (24.28) 1,552,323.45 108,210.84 113,910.67 116,276.45 121,457.91 128,411.40 134,599.94 126,050.70 130,957.17 135,863.64 139,681.77 146,886.90 149,991.76 0.00 Payment of Accrued Interest 722,867.22 Actual Balance per Statements 19,855,200.66 _20,933,048.73 _21,367,800.96 22,319,983.25 23,597,807.17 24,739,520.55 23,163,988.26 18,495,400.44 Difference 0.00 0.00 0.00 0.00 0.00 0.00 0.00 (24,065,636.38) (24,967,284.50) (25,668,932.61) (26,992,997.73) (27,563,570.85) (0.26) BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE F/Y 2006 Proposed Budget Summary of expense changes from F/Y 2005 amended - $273,885 (8.3%) decrease in operating expenses primarily due to no recurring cost for SVC training and project valuation. - $549,163 increase in R&C fund repayment for increased fund expenditures in F/Y 06 (see Schedule D for detail). - $200,000 decrease for transmission relay replacements (project to be completed by end of F/Y 05). - $3,275 increase for debt service based on repayment schedule. - $2,782 decrease in arbitrage transfer. - $15,000 decrease for operating fund transfer (due to no operating budget increase). Other points - R&C fund expenditures (Schedule D) includes $400,000 for a pending change order on the governor project. - Other expenditures assume that SVC training, transmission relay replacements, and project valuations will be completed in F/Y 05. BRADLEY LAKE HYDROELECTRIC PROJECT Schedule A AMENDED FY03 FY04 FY2005 FY2006 INC(DEC) ACTUALS ACTUALS BUDGET BUDGET FROM PY REVENUES, EXPENSES & CHANGES IN SURPLUS REVENUES UTILITY CONTRIBUTIONS 14,409,226 14,759,083 16,030,046 16,125,172 95,126 INTEREST INCOME 1,840,740 1,850,365, 1,552,323 1,517,966] (34,357) SALE OF VEHICLE 0 0 0 0 0 MISCELLANEOUS INCOME 2,680 0 0 0 0 16,252,646 16,609,448 17,582,369 17,643,138 60,769 EXPENSES OPERATIONS 2,316,682 3,299,790 3,284,811 3,010,926 | (273,886) RENEWALS/REPLACEMENTS (R&C FUND REPAYMENT! 321,021 784,571 1,581,725 2,130,888 | 549,163 REPLACE TRANSMISSION RELAYS 200,000 (200,000) PURCHASE NEW VEHICLE 29,130 11,067 0 0 TRANSFER TO OPERATING RESERVE 0 111,400 15,000 (15,000) DEBT SERVICE (net of Capital Reserve Reductions) 12,268,075 12,273,400 12,273,050 12,276,325 3,275 ARBITRAGE TRANSFER 163,420 202,711 227,782 225,000 (2,782) REFUND OF PRIOR YEARS SURPLUS 2,013,381 (73,492) 0 73,492 15,098,329 18,696,321 17,508,876 17,643,139] 134,262 CURRENT YEAR SURPLUS (DEFICIT) 1,154,317 (2,086,873) 73,493 BEGINNING SURPLUS 859,063 2,013,380 (73,492 ENDING SURPLUS (DEFICIT) 2,013,380 (73,492) 0 BALANCE SHEET ASSETS REVENUE FUND 1,759,535 (0) 0 OPERATING FUND 684,300 294,998 a RECEIVABLES LIABILITIE: RPL LIABILITIES 433,143 368,489 0 SURPLUS 2,013,381 (73,492) a 2,446,524 294,997 a OTHER INFORMATION OPERATING RESERVE * 535,000 646,400 661,400 MONTHLY CONTRIBUTIONS 1,200,768 1,594,243 1,374,959 * Required to be 20% of budgeted operating expense 3/16/20058:34 AMH:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xIlsSchedule A-Budget Summary BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET SUMMARY (A) HEA Annual Operations & Maintenance 1,216,500 1,198,460 18,040 1,166,649 625,390 1,226,600 (B) CEA Dispatch and Substation/SVC Maintenance 73,000 57,090 15,910 70,000 67,975 105,200 (C) Other O&M and Maintenance Projects 812,276 880,567 (68,291) 766,162 258,162 522,416 (D) Insurance Costs 610,000 677,601 (67,601) 725,000 572,587 616,209 (E) Regulatory Costs 245,630 196,835 48,795 182,500 53,520 166,000 (H) Contingencies 0 0 0 100,000 0 100,000 2,957,406 3,010,553 (53,147) 3,010,311 1,577,634 2,736,426 (F) Administrative Costs 274,500 289,237 (14,737) 274,500 233,765 274,500 3,231,906 3,299,790 (67,884) 3,284,811 1,811,399 3,010,926 (G) Bond Refunding Costs 0 0 0 0 0 0 3,231,906 3,299,790 (67,884 3,284,811 1,811,399 3,010,926 3/16/2005 8:34 AM Page 2 of 9 H:\ALL\lmacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FYOS 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET FERC 535 - Operation Supervision & Engineering (A) HEA O&M Contract 192,800 130,716 62,084 122,828 184,100 (C) HEA On-Site Civil Project Manager 23,732 (23,732) (C) HEA Digitize & Control Project Drawings 45,840 (45,840) 192,800 200,289 (7,489 122,828 184,100 FERC 537 - Hydraulic Expenses (A) HEA O&M Contract 39,900 3,900 36,000 35,730 39,900 3,900 36,000 | 35,730 FERC 538 - Electric Expenses : (A) HEA O&M Contract 63,800 197,032 (133,232) 99,365 (C) SOA BOILIER INSPECTION 0 1,710 (1,710) 0 63,800 198,742 (134,942) 99,365 FERC 539 - Misc. Hydraulic Power Generation Expenses (A) HEA O&M Contract 210,900 210,566 334 234,321 253,100 (C) Replace Two Way Radios 0 10,000 10,000 (C) DIS Voice/Data Circuits (inc. space & power) 10,000 0 10,000 0 0 (C) DIS 2-way Radio Circuits & radio maint. 7,000 0 7,000 0 0 (C) HEA Circuits and Radio - To Bernice Lake 90,000 90,000 0 90,000 45,000 90,000 (C) CEA Circuits -Bernice Lake to Anchorage 28,746 28,746 0 28,746 14,373 0 346,646 329,312 17,334 363,067 163,407 353,100 FERC 540 - Rents (C) Bradley Lake FERC land use fees (5% increase bi 108,000 100,220 7,780 74,000 66,115 108,000 100,220 7,780 74,000 66,115 FERC 542 - Maintenance of Structures (A) HEA O&M Contract 35,300 10,453 24,847 19,278 28,331 (C) Other 0 0 0 0 0 35,300 10,453 24,847 19,278 FERC 543 - Maintenance of Reservoirs, Dams & Waterways (A) HEA O&M Contract 62,000 2,235 59,765 10,278 (C) Bradley Lake Dam Repair 160,000 152,640 7,360 0 (C) Nuka Diversion 125,134 (125,134) (C) Middle Fork Diversion 20,000 20,245 (245) 15,000 3/16/2005 8:34 AM Page 3 of 9 H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET (C) Kachemak Creek Gauging Station 26,000 0 26,000 26,000 26,000 (C) Other O&M 0 0 | 268,000 300,253 (32,253) 51,278 41,400 FERC 544 - Maintenance of Electric Plant (A) HEA O&M Contract 368,400 342,669 25,731 276,741 216,138 295,000 (A) HEA O&M Contract-Runner Repairs 0 41,080 (41,080) 0 0 0 368,400 383,748 (15,348)] | 276,741 216,138 295,000 FERC 545 - Maintenance of Misc. Hydraulic Plant (A) HEA O&M Contract 210,600 153,066 57,534 282,169 81,200 264,000 (C) Martin River Road Study-Amendment & Removal 110,000 51,382 58,618 30,000 15,923 30,000 |__ 320,600 204,447 116,153 312,169 97,123 294,000 FERC 556 - System Control & Load Dispatching (A) HEA O&M Contract 12,200 74,428 (62,228) 23,315 14,289 9,000 (C) NOAA Weather Service 7,040 0 7,040 0 0 0 (C) SCS Snow Measurement 41,990 38,278 3,712 30,000 (8,482) 30,000 (C) UAA Seismic monitoring and reporting 56,500 56,500 0 56,500 30,845 56,500 (C) USGS Streamguaging 147,000 146,040 960 205,916 57,727 205,916 (C) State of Alaska Permits 0 100 (100) 0 100 0 264,730 315,346 (50,616 315,731 94,480 301,416 FERC 562 - Station Expenses (B) CEA SVC/Substation Maintenance Contract 73,000 57,090 15,910 70,000 67,975 105,200 (C) SVC Condition Assessment/Staff Training 0 200,000 36,561 0 73,000 57,090 15,910 | 270,000 104,536 105,200 FERC 571 - Maintenance of Overhead Lines (A) HEA Overhead Line Maintenance 20,600 32,316 (11,716) 62,624 6,788 20,600 32,316 (11 716)| 62,624 (H) Contingencies 0 0 0 100,000 100,000 FERC 920 - Administrative Expense (F) AEA Admin Fee 200,000 200,000 0 200,000 200,000 200,000 AEA Administrative Costs 200,000 200,000 0 200,000 200,000 | | 200,000 | 3/16/2005 8:34 AM Page 4 of 9 H:\ALL\lmacmillan\BradleyLake\F YO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE OPERATIONS & MAINTENANCE SCHEDULE B FY05 28-Feb-05 FY2004 FY2004 AMENDED FY2005 FY2006 BUDGET ACTUAL VARIANCE BUDGET YTD ACTUAL BUDGET PMC Costs (F) Bradley Lake Audit fees 8,500 7,898 602 8,500 8,100 8,500 (F) Bradley Lake PMC Legal 40,000 57,945 (17,945) 40,000 2,845 40,000 (F) Bradley Lake Arbitrage Report 6,000 5,800 200 6,000 5,225 6,000 (F) Bradley Lake Trustee fees 20,000 17,595 2,406 20,000 17,595 20,000 (F) PMC Costs 74,500 89,237 (14,737) 74,500 33,765 74,500 Bond Refunding Costs Reimburseable costs Refunding Costs 0 0 0 0 0 0 TOTAL FERC 920 274,500 289,237 (14,737) 274,500 233,765 274,500 FERC Insurance Premiums 555,000 547,895 7,105 590,000 529,723 556,209 (D) Homer Electric Insurance 30,000 57,972 (27,972) 60,000 28,352 60,000 (D) Risk Assessment 25,000 71,734 (46,734) 75,000 14,512 0 (D) 610,000 677,601 (67,601) | 725,000 572,587 616,209 FERCFERC administrative fees 150,000 44,424 105,576 126,000 0 126,000 (E) FERC Instrumentation Data Collection 57,687 (57,687) 0 (E) Seismic Survey Spillway 18,771 (18,771) 0 (E) Contractual Engineer - FERC license issues 31,500 3,816 27,684 31,500 45,974 40,000 (E) Spillway Seepage Water and Pressure Study 64,130 72,137 (8,007) 25,000 7,546 0 (E) 245,630 196,835 48,795 182,500 53,520 166,000 3,231,906 3,299,790 (67,884 3,284,811 1,811,399 3,010,926 TOTAL BRADLEY LAKE BUDGET 3/16/2005 8:34 AM Page 5 of 9 H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule B-Budget Detail BRADLEY LAKE MONTHLY UTILITY CONTRIBUTION SCHEDULE C POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC CITY OF SEWARD POWER PURCHASER CHUGACH ELECTRIC MUNICIPALITY OF ANCHORAGE AEG&T GOLDEN VALLEY ELECTRIC CITY OF SEWARD COMPONENTS OF CHANGE IN CONTRIBUTION FY2005 ANNUAL CONTRIBUTION Revenue Changes AMENDED ACTUAL BUDGET BUDGET PERCENT FY2004 FY2005 FY2006 FY2006 SHARE TOTAL TOTAL TOTAL DECREASE 30.4% 4,509,110 5,015,846 4,902,050 (113,796) 25.9% 3,841,634 4,273,370 4,176,420 (96,950) 25.8% 3,826,802 4,256,870 4,160,292 (96,578) 16.9% 2,506,706 2,788,418 2,725,152 (63,266) 1.0% 148,322 165,002 161,256 (3,746) 100.0% 14,832,574 16,499,506 16,125,170 (374,336) AMENDED FY2004 FY2005 PERCENT MONTHLY MONTHLY FY2006 FY2006 SHARE AVERAGE AVERAGE MONTHLY | DECREASE 30.4% 375,759 417,987 408,504 (9,483) 25.9% 320,136 356,114 348,035 (8,079) 25.8% 318,900 354,739 346,691 (8,048) 16.9% 208,892 232,368 227,096 (5,272) 1.0% 12,360 13,750 13,438 (312) 100.0% 1,236,047 1,374,958 1,343,764 31,194 (INCREASE) DECREASE IN BUDGETED INTEREST EARNINGS Expenditure Changes INCREASE (DECREASE) IN BUDGETED O&M COSTS INCREASE (DECREASE) IN PAYBACK TO R&C FUND INCREASE (DECREASE) TRANSMISSION RELAYS REPLACEMENTS INCREASE (DECREASE) VEHICLE PURCHASE INCREASE (DECREASE) IN DEBT INCREASE (DECREASE) IN EXCESS EARNINGS TRANSFER SERVICE INCREASE (DECREASE) IN OPERATING RESERVE TRANSFER Other IMMATERIAL ROUNDING DIFFERENCES NET INCREASE(DECREASE) FY2006 ANNUAL CONTRIBUTION 16,030,046 34,357 (273,886) 549,163 (200,000) 3,275 (2,782) (15,000) 95,127 __16,125,173_ (1) 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\FY O6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule C Utility Contrib BRADLEY LAKE R&C FUND DISBURSEMENTS AND REPAYMENTS SCHEDULE D "ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL ACTUAL "ACTUAL PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED [PROJECTED PROJECTED PROJECTED TO REPAY TO REPAY TO REPAY TO REPAY TO REPAY TO REPAY Description Disburse Repay at 06/30/03, Disburse R&C Interest Repay at 06/30/04 Disburse Repay at 06/30/05 Repay at 06/30/06 Disburse Repay at 06/30/07 Disburse Repay at 06/30/07 Needle repairs 890,667.09 (222,666.77) 668,000.32] 587,046.30 (291,047.00) (369,428.35) 594,571.27 (694,571.27) Runner repairs 27,719.72 (6,929.93) 20,789.79 78.76 (6,949.62) 13,918.93 (13,918.93) 262,253.24 (65,563.31) 196,689.93 367.10 (65,655.09) 131,401.95 (131,401.95) 103,444.32 (25,861.08) 77,583.24] 132,182.58 (58,906.73) 150,859.10 683,559.79 (834,418.89) 1,360,000.00 _(1,360,000.00) [Replace Runners 95,888.00 (95,888.00) 2,600,000.00 (2,600,000.00) Replace cable from dam to power house 400,000.00 (400,000.00) ace power system stabilizer 200,000.00 (200,000.00) ace two RTUs 75,000.00 (75,000.00) ER REIMB - 7,414.39 7,414.39 (7,414.39) Ending Balance $_1,284,084.37_$ (321,021.09) $ 963,063.28] $_719,674.74 I $ (291,047.00) $ (493,525.39) $ 898,165.63 E 4: $_2,130,888.00_$ _(2,130,888.00) $ $_2,600,000.00_$_(2,600,000. Balance in R&C Fund at June 30 $_4,101,834.37 RECAP-GOVERNOR PROJECT REVISED-03/15/05 MONTH CONST FUND R&C FUND TOTAL ACTUAL FYO3 0.00 103,444.22 103,444.22 Fos 0.00 132,182.58 132,182.58 ‘otal as of 30June2004 0.00 235,626.80 235,626.60 PROJECTED December-04 510,000.00 0.00 510,000.00 March-04 1,070,784.00 0.00 1,070,784.00 April-05 119,216.00 0.00 119,216.00 May-05 0.00 0.00 0.00 May-05 0.00 680,000.00 680,000.00 FY0S Additions 1,700,000.00 680,000.00 __2,380,000.00 July-05 0.00 560,000.00 560,000.00 July-05 0.00 325,000.00 325,000.00 September-05 0.00 475,000.00 475,000.00 _(inlcuded pending change order) FY06 Additions 0.00 1,360,000.00 1,360,000.00 Total Cost of Project 1,700,000.00 __2,275,626.80__3,975,626.80 0.00 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\F YO6BBRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule D R&C Disb & Repay BRADLEY LAKE BUDGET ACTIVITY BY ACCOUNT SCHEDULE G Rev Fund O&M Eund Debt Fund Op Reserve R&C Cap Reserve Total 6/30/2004 Actual Balance (0) 294,998 : 646,400 4,101,835 12,834,000 17,877,232 A 20.001% of Annual O&M Budget FY2005 Budget-Revised - Revenues 16,030,046 - 16,030,046 Interest 1,552,323 1,552,323 Transfer back interest - Transfers to O&M (3,284,811) 3,284,811 - - Transfers to Debt Service (12,273,050) 12,273,050 : Payback of R&C Fund (1,581,725) 1,581,725 - 2004 O&M Reauisitions (368,490) (368,490) 2005 O&M Requisitions (3,284,811) (3,284,811) 2005 Capital Requistions (200,000) 200,000 - - Renewals/Replacements (200,000) - (683,560) - (883,560) To Excess Earnings fund (227,782) (227,782) Payment of Prior Year Deficit 73,492 73,492 Debt Payments (12,273,050) (12,273,050) Increase Op Reserve (15,000) 15,000 : 6/30/2005 Projected Balance 0 (0) - 661,400 5,000,000 12,834,000 18,495,400 a FY2006 Budget ~ Revenues 16,125,172 - 16,125,172 Interest 1,517,966 1,517,966 Transfer back interest - - Transfers to O&M (3,010,926) 3,010,926 - - Transfers to Debt Service (12,276,325) 12,276,325 = Payback of R&C Fund (2,130,888) 2,130,888 - 2005 O&M Reauisitions - - 2006 O&M Reaquisitions (3,010,926) (3,010,926) 2006 Capital Requistions - - - - Renewals/Replacements - - (2,130,888) - (2,130,888) To Excess Earnings fund (225,000) (225,000) Payment of Prior Year Deficit - - Debt Payments (12,276,325) (12,276,325) Increase Op Reserve - - - 6/30/2006 Projected Balance 0 (0) : 661,400 5,000,000 12,834,000 18,495,399 Assumption: should be 20.00% For purpose of budget cash flows, July 01 debt service projected 21.97% is assumed to be disbursed on June 30 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\FYO6BRADLEY\2006BradleyBdgt-DRAFT.xlsSchedule G-Cash balances BRADLEY LAKE BUDGET PROJECTED INTEREST INCOME SCHEDULE | TOTAL Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 OTHER ADJ Beginning Balance 18,495,399.55 18,495,399.55 19,043,043.97 19,874,623.59 20,556,203.21 21,712,782.83 22,869,362.45 23,921,554.07 22,537,448.95 23,694,028.57 24,850,608.19 25,332,187.82 26,488,767.44 27,645,347.06 Receipts Utility Contributions 16,125,172.00 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 ADJ INTEREST Interest Income Received 1,517,966.47 932,273.80 697,477.76 0.00 0.00 0.00 0.00 0.00 (111,785.09) TO ACCRUAL BASIS Repay Prior Year Deficit 0.00 0.00 17,643,138.47 2,276,038.13 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 2,041,242.09 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 1,343,764.33 (111,785.09) Disbursements Prior year accrued expenses 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 O&M Expenses (3,010,925.55) (943,393.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (195,684.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) (187,184.71) R&C Fund Disbursement (2,130,888.00) (560,000.00) (325,000.00) (475,000.00) 0.00 0.00 (95,888.00) (675,000.00) Debt Service Payment (12,276,325.00) (3,238,162.50) (9,038,162.50) ASSUME DEBT Capital Requisitions 0.00 SERVICE PD 06/30/05 Fvreecs Eamings Transfer (225,000.00) (225,000.00) Adjustment-Equal Sch G 0.00 (17,643,138.55) _(1,728,393.71) (512,184.71) (662,184.71) (187,184.71) (187,184.71) (291,572.71) _(3,425,347.21) (187,184.71) (187,184.71) (862,184.71) (187,184.71) (187,184.71) _ (9,038,162.50) Adjust to Actual 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Ending Balance 18,495,399.47 19,043,043.97 19,874,623.59 20,556,203.21 21,712,782.83 22,869,362.45 23,921,554.07 —_22,537,448.95 23,694,028.57 _ 24,850,608.19 25,332,187.82 26,488,767.44 27,645,347.06 — 18,495,399.47 Interest Income Projection Estimated Accrued Interest 1,517,966.47 103,784.59 108,316.70 112,031.31 118,334.67 124,638.03 130,372.47 122,829.10 129,132.46 135,435.81 138,060.42 144,363.78 150,667.14 Adjust to Actual Received 1,517,966.47 103,784.59 108,316.70 112,031.31 118,334.67 124,638.03 130,372.47 122,829.10 129,132.46 135,435.81 138,060.42 144,363.78 150,667.14 0.00 Payment of Accrued Interest 697,477.76 Actual Balance per Statements 18,495,399.90 Difference (19,043,043.97) (19,874,623.59) (20,556,203.21) (21,712,782.83) (22,869,362.45) (23,921,554.07) (22,537,448.95) (23,694,028.57) (24,850,608.19) (25,332,187.82) (26,488,767.44) (27,645,347.06) 0.43 3/16/20058:34 AM H:\ALL\Imacmillan\BradleyLake\F YO6BRADLEY\2006BradleyBdgt-DRAFT.xisSchedule I-Interest Inc ITEM 7E Resolution to Extend the Operation and Maintenance Agreement With Homer Electric Association Whereas Homer Electric Association, Inc. has performed the Operation and Maintenance of the Bradley Lake Hydroelectric Project for the last ten years and Whereas Homer Electric Association, Inc. has performed these services with diligence, care and in a cost effective manner and Whereas Homer Electric Association, Inc. has developed the expertise required and Whereas Homer Electric Association, Inc. has coordinated their communication system with that of the Bradley Lake Hydroelectric Project; Now therefore be it resolved to request the Alaska Energy Authority to extend the current Operation and Maintenance Agreement with Homer Electric Association, Inc. for an additional five years. MOTION: SECOND: PLEASE DELIVER TO THE FOLLOWING: Steve Haagenson Golden Valley Electric Association (907) 458-5951 Joe Griffith Chugach Electric Association (907) 562-6994 Bradley Janorschke Homer Electric Association (907) 235-3323 Wayne Carmony Matanuska Electric Association (907) 689-9368 Jim Posey Anchorage Municipal Light & Power (907) 263-5204 Dave Calvert City of Seward (907) 224-4085 Ron Saxton AterWynne (503) 226-0079 NOTE: Please add the following page to your BPMC packet for tomorrow’s meeting. Number of pages including cover sheet: 2 * * ¥ Transmis...n Result Report (MemoryTX) (Mar-vv- 2005 7:25AM) * * * 1) AIDEA/ZAEA 2) Date/Time: Mar-30. 2005 7:20AM File Page No. Mode Destination Pg (s) Result Not Sent 4976 Memory TX 919074585951 P. 2 OK 95626994 Ok 919072353323 OK 96899368 OK 92635204 OK 919072244085 OK 915032260079 OK Reason for error E-1) Hangs up or line fail - —.2) Busy E.3) No answer E.4) No facsimile connection PLEASE DELIVER TO THE FOLLOWING: | Steve Haagenson Golden Valley Electric Association (907) 458-5951 Joe Griffith Chugach Electric Association (907) 562-6994 Bradley Janorschke Homer Electric Association (907) 235-3323 Wayne Carmony Matanuska Electric Association (907) 689-9368 Jim Posey Anchorage Municipal Light & Power (907) 263-5204 Dave Calvert City of Seward (907) 224-4085 Ron Saxton AterWynne (603) 226-0079 Number of pages including cover sheet: 2 . Page 1 of 1 Shauna Howell From: Shauna Howell Sent: | Wednesday, March 30, 2005 7:04 AM To: ‘Art Copoulos'; 'Bradley Janorschke’; 'Brenda Applegate’; 'Brenda Fuglestad’; 'Brian Bjorkquist'’; ‘Dave Calvert’; 'Dianne Hillemeyer’; 'Don Stead’; 'Henri Dale’; ‘Jim Posey’; ‘Joe Griffith’; 'Karl Reiche', 'Linda MacMillan’; 'Mike Cunningham’; 'Rick Eckert’; 'Ron Saxton’; 'Steve Haagenson’; ‘Susan Redlin'; 'Wayne Carmony' Subject: BPMC Packet Addition Please print and add the following one-page document to your BPMC packet for tomorrow's meeting. Thank you. 3/30/2005 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING AGENDA Thursday, March 31, 2005 — 10:00 a.m. (Via electronic media at AIDEA/AEA — 813 W. Northern Lights Boulevard) (Corner of Arctic and Northern Lights Boulevard) CALL TO ORDER Haagenson ROLL CALL (for Committee members) PUBLIC ROLL CALL (for all others present) PUBLIC COMMENT AGENDA COMMENTS APPROVAL OF MEETING MINUTES November 18, 2004 NEW BUSINESS A. Approve Utilities’ FY04 Deficit Repayment to the Project B. Approve FY05 Budget Changes to Increase Expenses for the Property Valuation and Fully Repay the R&C Fund LE IWWTRAAL| OD Approval of FY06 Budget HEA O&M Contract Extension Term Stead/Copoulos Turbine Runner Replacement — Risk Analysis, / FUJI Contracts, & Replacement Recommendations Tey Stead/Hickey/Copoulos mmo 4 Orel: COMMITTEE REPORTS / COMMENTS A. Operators Report 1. SEES Statue / Stead B. Next Meeting Date Ss ode Haagenson ADJOURNMENT A aN : Y 5 her rapped AS Y . AlaskQundustrial Development and Export Autl AIDE AWA Ate: Alaska Energy Authority Od or ey; Wi FACSIMILE TRANSMITT. To: Ofeve Haccepsor GVEA FAX #: 15¢ -5%/ FROM: Shane Aoved/ DATE: 3-6 -05 Number of pages including cover page: COMMENTS: NOTICE: This facsimile may contain confidential information that is being transmitted to and is intended only for the use of the recipient named above. Reading, disclosure, discussion, dissemination, distribution, or copying of this information by anyone other than the named recipient or his or her employees or agents is strictly prohibited. If you have received this facsimile in error, please destroy it and notify us by telephone at (907) 269-3000. 813 West Northern Lights Boulevard * Anchorage, Alaska 99503 907 / 269-3000 * FAX 907 / 269-3044 * Toll Free (ALASKA ONLY) 888 / 300-8534 * www.aidea.org | ¢ 4 * * * Transmission Result Report (MemoryTX) ( Mar... 2005 9:28AM) * * * 1) AIDEAZAEA 2) Date/Time: Mar.16. 2005 9:28AM File Page No. Mode Destination Pg (s) Result Not Sent 4882 Memory TX 919074585951 Priel? OK ne ae delat hate Ie LPT TTT Id) eee) ele Cl deel lal it ete —E.1) Hangs up or line fail —.2) Busy —E.3) No answer E.4) No facsimile connection FACSIMILE TRANSMITTAL To: Shue Hoagens os GVEA FAX #: fof - 575/ FROM: Shaune Howell DATE: sl ne /eIs0S) Number of pages including cover page: of COMMENTS: Dot Apnch Be Spprevel. 813 West Northern Lights Boulevard = Anchorage, Alaska 99503 907 / 269-3000 + FAX 907 / 269-3044 * Toll Free (ALASKA ONLY) 888 / 300-8534 + wwicaidea.org Page 1 of 2 - a: Shauna Howell From: Art Copoulos Sent: Monday, March 14, 2005 3:32 PM To: Shauna Howell Subject: RE: BPMC meeting agenda _ Here’s 2 more items to add: _ Turbine Runner Replacement — Risk Analysis, FUJI Contracts, and Replacement Recommendation Governor Project Status _ Thanks, Art From: Shauna Howell Sent: Monday, March 14, 2005 3:14 PM To: Art Copoulos Subject: RE: BPMC meeting agenda Thanks. I'm hoping to fax the agenda up to Steve by Wednesday for approval. Thanks. From: Art Copoulos Sent: Monday, March 14, 2005 3:13 PM To: Shauna Howell Subject: FW: BPMC meeting agenda Shauna, Please add the following agenda item to the BPMC meeting agenda: E. “HEA O&M Contract extension term” Thanks — | am also working on adding another agenda item and will let you know ASAP. Art From: Stead, Donald (Don) [mailto:dstead@HomerElectric.com] Sent: Monday, March 14, 2005 2:56 PM To: Art Copoulos Cc: Shauna Howell; Janorschke, Brad Subject: RE: BPMC meeting agenda Please add an item to have the BPMC authorize AEA to extend the O&M contract for five years. From: Art Copoulos [mailto:acopoulos@aidea.org] Sent: Friday, March 11, 2005 9:32 AM. To: Brian_Hickey@chugachelectric.com; Stead, Donald (Don); DayRH@ci.anchorage.ak.us Subject: FW: BPMC meeting agenda 3/14/2005 Page 2 of 2 Gov committee, Do you want to update the BPMC on the Governor project and also talk about the risk analysis used to justify purchase of replacement turbine runners? The meeting will be sometime in March. We owe them at least the risk analysis discussion. Please let me know today as we are setting up agenda. Art From: Shauna Howell Sent: Friday, March 11, 2005 9:27 AM To: Art Copoulos Subject: While I'm trying to reach GVEA, | thoughtl'd send this up to you. It's a draft of theagenda items forthe meeting - can you think of anything else that should beadded? Approve Utilities’ FY04 Deficit Repayment to the Project Approve FY05 Budget Changes to Increase Expenses for the Property Valuation and Ful Repay the R&C Fund Budget Adjustment Approval of FY06 Budget GO WP Also, | have verbatim minutes typed up of the November meeting if you would like to read throug them in reference to your question about the runners. 3/14/2005 Page 1 of 2 Shauna Howell From: Art Copoulos Sent: Monday, March 14, 2005 3:13 PM To: Shauna Howell Subject: FW: BPMC meeting agenda Shauna, Please add the following agenda item to the BPMC meeting agenda: _E. “HEA O&M Contract extension term” Thanks — | am also working on adding another agenda item and will let you know ASAP. Art From: Stead, Donald (Don) [mailto:dstead@HomerElectric.com] Sent: Monday, March 14, 2005 2:56 PM To: Art Copoulos Cc: Shauna Howell; Janorschke, Brad Subject: RE: BPMC meeting agenda Please add an item to have the BPMC authorize AEA to extend the O&M contract for five years. -----Original Message----- From: Art Copoulos [mailto:acopoulos@aidea.org] Sent: Friday, March 11, 2005 9:32 AM To: Brian_Hickey@chugachelectric.com; Stead, Donald (Don); DayRH@ci.anchorage.ak.us Subject: FW: BPMC meeting agenda Gov committee, Do you want to update the BPMC on the Governor project and also talk about the risk analysis used to justify purchase of replacement turbine runners? The meeting will be sometime in March. We owe them at least the risk analysis discussion. Please let me know today as we are setting up agenda. Art From: Shauna Howell Sent: Friday, March 11, 2005 9:27 AM To: Art Copoulos Subject: While I'm trying to reach GVEA, | thoughtl'd send this up to you. It's a draft of theagenda items forthe meeting - can you think of anything else that should beadded? A. Approve Utilities’ FY04 Deficit Repayment to the Project 3/14/2005 Page 2 of 2 B. Approve FY05 Budget Changes to Increase Expenses for the Property Valuation and Ful Repay the R&C Fund C. Budget Adjustment D. Approval of FY06 Budget Also, | have verbatim minutes typed up of the November meeting if you would like to read throug them in reference to your question about the runners. 3/14/2005 Page 1 of 1 Shauna Howell From: Stead, Donald (Don) [dstead@HomerElectric.com] Sent: Monday, March 14, 2005 2:56 PM To: Art Copoulos Ce: Shauna Howell; Janorschke, Brad Subject: RE: BPMC meeting agenda Please add an item to have the BPMC authorize AEA to extend the O&M contract for five years. From: Art Copoulos [mailto:acopoulos@aidea.org] Sent: Friday, March 11, 2005 9:32 AM To: Brian_Hickey@chugachelectric.com; Stead, Donald (Don); DayRH@ci.anchorage.ak.us Subject: FW: BPMC meeting agenda Gov committee, Do you want to update the BPMC on the Governor project and also talk about the risk analysis used to justify purchase of replacement turbine runners? The meeting will be sometime in March. We owe them at least the risk analysis discussion. Please let me know today as we are setting up agenda. Art From: Shauna Howell Sent: Friday, March 11, 2005 9:27 AM To: Art Copoulos Subject: While I'm trying to reach GVEA, | thoughtl'd send this up to you. It's a draft of theagenda items forthe meeting - can you think of anything else that should beadded? Approve Utilities’ FY04 Deficit Repayment to the Project Approve FY05 Budget Changes to Increase Expenses for the Property Valuation and Ful Repay the R&C Fund Budget Adjustment Approval of FY06 Budget GO wp Also, | have verbatim minutes typed up of the November meeting if you would like to read throug them in reference to your question about the runners. 3/14/2005 Shauna Howell From: Linda MacMillan Sent: Thursday, February 10, 2005 9:18 AM To: Mike Cunningham; Art Copoulos Ce: Shauna Howell; Shellie M. Helton Subject: When is the next BPMC meeting? Mike and Art, Have either of you heard when the next BPMC meeting is scheduled? There needs to be one by the last week of March, _ 2005 and the following three financial items need to be on the agenda: 1. Approve Utilities’ FY04 deficit repayment to the project. 2. Approve FY05 budget changes to increase expenses for the property valuation and fully repay the R&C fund. 3. Approve the FY06 budget. Linda AEA Finance Message Page 1 of 1 Linda MacMillan From: Mike Cunningham [Mike_Cunningham@chugachelectric.com] Sent: | Wednesday, March 16, 2005 8:28 AM To: Linda MacMillan Subject: RE: Can | print budget proposals for Shauna Got them. Thanks for your hard work. I will be over about 9 on the 31st. Are you available to get me "straightened out on what to say? Mike Cunningham Senior Vice President, Chief Financial Officer Chugach Electric Association, inc. 907-762-4778 (office) 907-762-4514 (fax) 907-240-4778 (cell) mike_cunningham@chugachelectric.com From: Linda MacMillan [mailto:Imacmillan@aidea.org] Sent: Wednesday, March 16, 2005 8:21 AM To: Mike Cunningham Cc: Shauna Howell Subject: Can I print budget proposals for Shauna Mike, | attached once again my draft of the F/Y06 budget bullets in case you did not get them yesterday. Please let me know if | can go forward with giving the F/Y 05 amended and F/Y 06 draft budgets to Shauna, along with F/Y04 audit reports. | will also work with her to draft 4 motions: 1. Approve repayment of F/Y04 deficit 2. Approve F/Y 05 amended 3. Approve F/Y 06 proposed 4. Authorize AEA to make a transfer to the R&C fund from the Revenue fund for an amount equal to the lesser of F/Y 05 amended budget or amount to bring R&C fund up to $5,000,000. (In case actual spent is less than projected.) Linda AEA Finance <<BradleyFY06BdgtBullets.doc>> 3/16/2005 Page 1 of 2 Shauna Howell From: Linda MacMillan Sent: Monday, March 21, 2005 1:09 PM To: Shauna Howell Ce: Mike Cunningham Subject: RE: BPMC Agenda - round 2 Importance: High Shauna, | just remembered what the other item should be: Approve AEA to transfer to the Renewal and Contingency(R&C) Fund from the Revenue Fund, the lesser of the FY05 budgeted amount or amount required to required to restore the R&C Fund balance to $5,000,000 at the end of June, 2005. Agenda title could be shortened to: Approve June 2005 transfer from the Revenue Fund to the R&C Fund. Linda From: Shauna Howell Sent: Monday, March 21, 2005 1:03 PM To: Linda MacMillan Subject: RE: BPMC Agenda - round 2 That was the same question that Mike had, so I'm taking it off the agenda - | believe it is a duplicate of the previous item, just mis-named. Thanks! From: Linda MacMillan Sent: Monday, March 21, 2005 12:20 PM To: Shauna Howell Subject: RE: BPMC Agenda - round 2 | only have one question. What is item 7 C, "Budget Adjustment Recommendation? Otherwise it looks good to me. Thanks. Linda From: Shauna Howell Sent: Monday, March 21, 2005 9:04 AM To: Linda MacMillan Subject: BPMC Agenda - round 2 Good morning, | just spoke with Mike Cunningham and wanted to run this by you, too, prior to finalizing Please review and let me know if this looks complete. 3/21/2005 Page 2 of 2 NEW BUSINESS Approve Utilities’ FY04 Deficit Repayment to the Project Approve FY05 Budget Changes to Increase Expenses for the Property Valuation and Fully Repay the R&C Fund Budget Adjustment Recommendation Approval of FY06 Budget HEA O&M Contract Extension Term Stead/Copoulos Turbine Runner Replacement — Risk Analysis, FUJI Contracts, & Replacement Recommendations Audit Approval Stead/Hickey/Copoul 7™MOQ WP COMMITTEE REPORTS / COMMENTS A. Operators Report 1. Governor Project Status Stead 2; Budget Committee Report/Appraisal Audit Update Cunningham 3/21/2005 Ww J ht 7 2 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING AGENDA Thursday, March 31, 2005 — 10:00 a.m. (Via electronic media at AIDEA/AEA — 813 W. Northern Lights Boulevard) (Corner of Arctic and Northern Lights Boulevard) CALL TO ORDER ROLL CALL (for Committee members) PUBLIC ROLL CALL (for all others present) PUBLIC COMMENT AGENDA COMMENTS APPROVAL OF MEETING MINUTES November 18, 2004 NEW BUSINESS Approve Utilities’ FY04 Deficit Repayment to the Project Approve FY05 Budget Changes to Increase Expenses for the Property Valuation Approve June 2005 Transfer from the Revenue Fund to the R&C Fund Approval of FY06 Budget HEA O&M Contract Extension Term Turbine Runner Replacement — Risk Analysis, FUJI Contracts, & Replacement Recommendations Audit Approval amo O Bp COMMITTEE REPORTS / COMMENTS A. Operators Report ae Governor Project Status 2: Budget Committee Report/Appraisal Audit Update B. Next Meeting Date ADJOURNMENT Haagenson Cunningham Cunningham Cunningham Cunningham Stead/Copoulos Stead/Hickey/Copoulos Stead Cunningham Haagenson