Loading...
HomeMy WebLinkAboutBPMC Meeting - March 3, 1989 3a RECORD UOPY Alaska Power Authority "= %° TRO S-lhl ww MEMORANDUM TOs Bradley Lake Project Repos eene Committee Brest. |e FROM: Robert E. LeResche / Secretary, PMC DATE: February 1, 1989 SUBJECT: March 3, 1989 Meeting The next meeting of the Bradley Lake Project Management Committee (PMC) has been scheduled for March 3, 1989. Enclosed is a draft agenda for this meeting. Please provide Chairman Kelly with any additions to the enclosed agenda. Also enclosed for your review are the draft meeting minutes from the January 20, 1989 PMC meeting, which will be considered for approval at the next meeting. Enclosed for your record are the following documents: at) Executed minutes of the November 30, 1988 PMC meeting, 2) Bradley PMC Resolution 88-2, Providing for the payment of stability study costs, and 3) Bradley PMC Resolution 89-3, Requesting Rural Electrification Administration approval of all documents relating to the Bradley Lake Hydroelectric Project. Enclosures: as stated BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MARCH 3, 1989 AGENDA Chugach Electric Association, Inc. Training Room 3601 Minnesota Drive Anchorage, Alaska 1. CALL TO ORDER Kelly 10:00 a.m. 2. ROLL CALL 3. PUBLIC COMMENT 4, MODIFICATION OF AGENDA Kelly 5. APPROVAL OF MINUTES Kelly January 20, 1989 6. FINANCE COMMITTEE REPORT LeResche 7. TECHNICAL COORDINATING COMMITTEE REPORT Yerkes 8. REVIEW OF PROJECT STATUS Eberle 9. OLD BUSINESS Kelly Status Report on Rural Electrification Administration Approvals 10. NEW BUSINESS Kelly a. Define PMC Major Issues b. Develop PMC Objectives c. Develop PMC Timetable for Meeting Objectives d. Schedule Next Meeting i. Date ii. Location iii, Time 11. COMMUNICATIONS 12, ADJOURNMENT Kelly BPMC MEETING MINUTES (JANBRAI] __ P) PAGE 10F4 JANUARY 20, 1989 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE January 20, 1989 1. CALL TO ORDER Chairman Kelly called the Bradley Lake Project Management Committee to order at 1:50 p.m. in the Training Room of Chugach Electric Association to conduct the business of the Committee per the agenda and public notice. 2. ROLL CALL The roll call was taken and a quorum was established. In attendance were the following: Designated Representati Designated Alternate Representing Robert E. LeResche Brent N. Petrie Alaska Power Authority James F, Palin Myles C. Yerkes Matanuska Electric Association Dave Highers Tom Lovas Chugach Electric Association Kent Wick Homer Electric Association Michael Kelly Golden Valley Electric Association Thomas R. Stahr John Cooley Municipal Light and Power Representatives Absent Alternates Absent Representing E. Paul Diener Bob Peirson City of Seward Sam Mathews Homer Electric Association Robert Hansen Golden Valley Electric Association oO Representing Ron Saxton Golden Valley Electric Association Dave Hutchens Alaska Rural Electric Coop Assoc Carol Johnson Chugach Electric Association Marcey Rawitscher Alaska Power Authority Julie Becker Alaska Power Authority Dave Eberle Alaska Power Authority 3. PUBLIC COMMENT There being no public comment, Chairman Kelly proceeded to agenda item 4. 4. MODIFICATION OF AGENDA No modifications to the revised agenda were made. BPMC MEETING MINUTES (JANBRAI P) PAGE 2 OF 4 JANUARY 20, 1989 5. APPROVAL OF MINUTES Mr. Highers motioned, seconded by Mr. Cooley, that the minutes of the November 30, 1988 meeting be approved. The mo- tion passed without objection. 6. FINANCE COMMITTEE REPORT Mr. LeResche noted that interest rates are favorable, and are anticipated to remain favorable through the remainder of 1989. Ms. Rawitscher distributed copies of her January 17, 1989 memorandum to the PMC, subject, costs associated with Brad- ley Lake variable rate demand bonds. 7. TECHNICAL COORDINATING COMMITTEE REPORT Mr. Yerkes reported that the TCC will meet with Southern Company Services, Inc. (SEI) on January 23, 1989 regarding SEI’s assessment of reliability of the Bradley Junction to Fritz Creek transmission line. Mr. Stahr expressed the concern that the Bradley Lake Hydroelectric Project budget not be reduced until the cost of stability is determined. Mr. LeResche responded that approximately 3 weeks ago, the Power Authority reduced the budget estimate to $350,000,000, which included $328,000,000 as the estimated cost of construction and $80,000,000 of the $328,000,000 as contingency. Mr. LeResche noted that the revised estimate does not reduce the total funds available; however, Mr. Le- Resche hopes that the cost of the solution to the stability issue will fall within the revised estimate. Mr. LeResche said that the remainder of the $175,000,000 in appropriations is held in a trustee account and that these funds cannot be reap- propriated by the Legislature until such time as the project is declared complete. 8. REVIEW OF PROJECT STATUS Mr. Eberle said that the Powerhouse Construction Contract was awarded to H.C. Price Construction Company with a bid price of $31,700,000. H.C. Price Construction Company will be on site in March - April of 1989. The General Civil Con- struction Contract (i.e., power tunnel excavation) is slightly behind schedule. The Tunnel Boring Machine (TBM) is cur- rently being overhauled and will be shipped to the site in February of 1989. The TBM should be operational by mid March, 1989. 9. OLD BUSINESS Mr. Saxton said that a timeline needs to be established for the following three outstanding items regarding the Rural Electrification Administration approvals: 1) Letter Agreement All but ML&P have approved. Letter Agreement will go with the Homer Transmission Agreement to the ML&P City Council for approval. Subsequently, the Power Authority will approve and Messrs. Petrie and Saxton will submit the ex- ecuted Letter Agreement to REA. BPMC MEETING MINUTES (JANBRA 1) PAGE 3 OF 4 JANUARY 20, 1989 2) REA requests for additional information REA has completed their requests for additional information. HEA will be sending their final response by January 23, 1989. 3) Homer Transmission Agreement Attorneys for all parties have signed off on this agreement and the redraft is ready for signature. Mr. Saxton said that all substantive issues with regard to securing REA approvals have been completed. Mr. Wick distributed copies of "Counterpart ___ of 15, Bradley Lake Hydroelectric Project, Amendment to Agreement for Sale of Transmission Capability by and among The HEA and CEA, GVEA, ML&P, and AEG&T." Mr. Saxton said that the parties need to take this agreement to their respective boards/assemblies for authorization to sign. Board/Assembly Approvals Governing Body Action Dates GVEA January 23, 1989 (Done) AML&P February 14, 1989 CEA February 1, 1989 HEA January 10, 1989 (Done) AEG&T by February 14, 1989 (will call a special meeting, since next regular meeting is March, 1989). Twelve copies of the signatory page to the Amendment to Agreement for Sale of Transmission Capability were signed by Messrs. Wick and Kelly for HEA and GVEA, respectively. The signatory pages were then provided to Mr. Highers for sig- nature subsequent to CEA Board approval. Due to the governing body action dates, the consensus was for Mr. Highers to provide the signatory pages to Mr. Wick (i.e. AEG&T), who in turn would provide them to Mr. Stahr (i.e, AML&P). Mr. Saxton said that he and Mr. Baldwin will submit copies of the Amendment to Agreement for Sale of Transmission Capability to REA for review purposes. The executed amendment will be provided once all of the signatures have been obtained. REA has already been provided with unsigned copies of the Letter Agreement for review purposes. 10. OTHER BUSINESS The next meeting was scheduled to begin at 10:00 a.m. on March 3, 1989 in the Training Room of Chugach Electric As- sociation. 6. FINANCE COMMITTEE REPORT (Continued) Mr. LeResche explained the costs associated with Bradley Lake Variable Rate Demand Bonds, as outlined in Ms. Rawitscher’s January 17, 1989 memorandum. It was noted that costs of issuance totaling $3,476,379 were paid for the $267,500,000 Bradley Lake Variable Rate Demand Notes issuance. John Nuveen and First Boston were paid $1,800,000 for management fees, sales commissions and expenses. Their counsel (i.e., underwriter’s counsel) was paid $220,000. First Southwest (Financial Advisor) was paid $1.25 per bond or $351,000. $40,000 was paid as an origination fee to the trustee (i.e., Bank of New York). Letters of Credit Fee for the first year was $700,000 and paid to three Japanese banks. Wohlforth BPMC MEETING MINUTES (JANBRA P) PAGE 4 OF 4 JANUARY 20, 1989 & Flint was paid $222,000 for bond counsel services. Additional costs of issuance included Trustee Counsel, Bank Coun- sel, Bond Rating, and Printing. The net earnings on this issuance are approximately $7,000,000 (i.e., net interest earnings minus total costs of issuance). It was noted that the next Bradley Lake bond issuance will have separate fees. 9. OLD BUSINESS (Continued) Mr. Saxton read "A Resolution of the Bradley Project Management Committee Requesting REA Approval of all Docu- ments Relating to the Bradley Lake Hydroelectric Project." This resolution provided that fully executed copies of all docu- ments be delivered to REA no later than February 20, 1989. Mr. Wick motioned, seconded by Mr. Stahr, that the PMC adopt this resolution. The motion passed without objection adopting this as Resolution 89-3. 11. COMMUNICATIONS There were no further communications or business. 12. ADJOURNMENT The PMC adjourned at 2:40 p.m. CHAIRMAN ATTEST: SECRETARY APPROVED AT PMC MEETING HELD BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE November 30, 1988 1. CALL TO ORDER Robert E. LeResche called the Bradley Lake Project Management Committee to order at 10:40 a.m. in the Training Room of Chugach Electric Association, to conduct the business of the Committee per the agenda and public notice. 2. ROLL CALL The roll call was taken and a quorum established. In attendance were the following: Designated Representative =—=__ Designated Alternate _Representing Robert E. LeResche Brent N. Petrie Alaska Power Authority E. Paul Diener City of Seward James F. Palin Myles C. Yerkes Matanuska Electric Association Dave Highers Tom Lovas Chugach Electric Association Kent Wick Sam Mathews Homer Electric Association Michael Kelly Robert Hansen Golden Valley Electric Association John Cooley Municipal Light and Power Representatives Absent Sei Alternates Absent Representing Bob Peirson City of Seward Thomas R. Stahr Municipal Light and Power Representing Marcey Rawitscher Alaska Power Authority Julie Becker Alaska Power Authority Dave Eberle Alaska Power Authority Ron Saxton Golden Valley Electric Association, Inc. Marnie Isaacs Alaska Power Authority Ron Zellar Anchorage Times (present for part of session) 3. PUBLIC COMMENT There being no public comment, Mr. LeResche proceeded to agenda item 4. 4. MODIFICATION OF AGENDA Discussion of HEA Transmission Services Agreement was added as agenda item 7.d. PMC Meeting Minutes (BRADNOV) Page 2 of 6 November 30, 1988 Agenda item 8., Status Report on Rural Electric Association Approvals, was corrected to Status Report on Rural Electrification Administration Approvals and became agenda item 7.c.1. Election of Officers was added as agenda item 5.b. 5.a. APPROVAL OF MINUTES Mr. Highers motioned, seconded by Mr. Cooley, that the minutes of the October 21, 1988 PMC meeting be approved as corrected. The motion passed without objection. 5.b. ELECTION OF OFFICERS Mr. Highers nominated Mr. Kelly for the position of Chairman of the PMC. There were no further nominations and the election was unanimous. Mr. Saxton noted that the Bradley Project Management Committee Bylaws, which were adopted via Resolution 88-1 at the October 21, 1988 meeting provide that the Power Authority serve as the permanent Secretary of the Committee (reference Article 3 of the Bylaws). Mr. Palin nominated Mr. LeResche as the Secretary with Mr. Petrie to serve as the Alternate Secretary. The election passed unanimously. Mr. Palin nominated Mr. Highers to serve as Vice-Chairman of the Committee. The election passed unanimously. 6. FINANCE COMMITTEE REPORT a. Review of Report on Meetings with Rating Agencies and Bond Insurance Com- panies Mr. LeResche noted the two reports which had been distributed by Ms. Rawitscher to the Committee members (reference Bradley Lake Hydroelectric Project Project Finance Team Newsletter Volume 1 and Number 2 - November 23, 1988). It was determined that Ms. Rawitscher would check with Messrs. Shira and Emerman, Alaska Power Authority, to deter- mine what information has previously been provided by the utilities in order to minimize any duplication of effort in the submittals to R.W. Beck, Consulting Engineer. It was noted that Ms. Rawitscher would coordinate the information flow to R.W. Beck. Mr. LeResche said that the work effort with R..W. Beck was proceeding slowly, pending receipt of the REA approvals. Mr. Palin requested that a summary of fees paid to date to John Nuveen and Company, lead underwriter, associated with the Bradley Lake Project be provided by the Power Authority to the PMC participants. Information requested included the year, amount, purpose, and net interest associated with any bond issuances. It was determined that Ms. Rawitscher would provide a summary of this information. 6.b. Consideration of Finance Team Mr. LeResche recommended that the PMC appoint two members to serve on the Finance Team in the interest of efficien- cy. These members would provide continuing advice to the Power Authority on the finance issue. Mr. Highers asked what the responsibilities and authority of the Finance Team would be. Mr. LeResche responded that the Finance Team would: work with the underwriters, assist in the selection of the co-manager; work with the Consulting Engineer, R.W. Beck, and PMC Meeting Minutes (BRADNOV) Page 3 of 6 November 30, 1988 the rating agencies; decide on the bond timing, sizing and pricing; provide document review (i.e., of the official statements); and report back to the PMC. Mr. LeResche noted that he would not take action relative to the bond issuance without dis- cussing the matter with the PMC. Mr. Cooley motioned, seconded by Mr. Wick, that Messrs. Palin and Kelly be appointed to serve on the Finance Team. Mr. Palin amended his motion to add a third member, Mr. Highers; the amendment was seconded by Mr. Cooley. The amendment to the main motion and the main motion carried without objection appointing Messrs. Palin, Kelly and Highers to serve on the Finance Team. It was noted in the intent of the motion that the primary players (i.e., Messrs. Palin, Kelly and Highers) participate; however, in the event that any of them were unable to participate, that alternates be present. Mr. Palin asked what legal right the PMC has in the Bradley Lake bond issuance. Mr. Saxton responded that in theory the PMC has no legal right; however, the PMC does have practical power in that the bonds will not be sold without utility con- sent. Mr. Highers suggested that the PMC establish through charter or other form of formally adopted direction, the tasks, duties and responsibilities of the Finance Subcommittee. Mr. LeResche clarified that the Finance Team is a working group, which provides input into the decision making process relative to the bond issuance. This is distinct from the Finance Sub- committee of the PMC (a policy group), which provides recommendations to the PMC relative to issues which the PMC has directed to the Subcommittee. Mr. Kelly suggested that it be a standard procedure that future PMC meetings be held in the Training Room of Chugach Electric Association and that CEA arrange for lunch to be brought in to these meetings for the participants. It was noted that the Anchorage area members did not incur travel expenses associated with attendance at the meetings as did the majority of the other members. There was no objection expressed. 7. REVIEW OF PROJECT STATUS Discussion on Independent Review of Stability Issue Mr. Eberle noted that most members of the TCC met yesterday (i.e., November 29, 1988) with Mr. Harrison Clark of Power Technologies, Inc. (PTI) to review the Power Authority’s planned approach to review of the stability studies. Mr. Cooley noted that PTI was not actually providing an independent review of the stability studies (i.e., by SEI), but rather a review of the stability issue. Mr. Cooley noted that PTI was directed to identify alternative resolutions (i.e., other than intertie), and the design for the alternative resolution to the stability issue. Mr. Eberle advised that as a result of the meeting, PTI’s scope was expanded to address; 1) intertie option, 2) non-intertie option, and 3) "band- aid" solution. The report by PTI will show the impact of not having the Bradley Junction to Fritz Creek section of the transmission line. The draft report is scheduled for January 30, 1989. PTI will develop alternative solutions and compare and contrast these methods and iden- tify three optimum solutions. At that time, utility feedback will be solicited and a final report issued one week (i.e., February 7, 1989) thereafter, assuming the Power Authority proceeds with Phases II of PTI’s contract. PTI would optimize the sizing and equipment specifications by June of 1989. 7.b. Consideration of Resolution Regarding Capitalizing the Cost of Stability Studies It was noted that CEA had paid SEI for their work relative to the Bradley Lake stability study, which has been completed, and was seeking reimbursement from Bradley Lake Project funds. It was further noted that the cost of the SEI was original- ly estimated at $60,000; however, the cost billed to date has been $45,000. Mr. Saxton read the draft resolution prepared by CEA which provides that the cost of the SEI Stability Study be capital- ized as a part of the Bradley Lake Project cost. Mr. LeResche noted that the draft resolution as written, provides that the Power Authority would thus pay 50% of the cost of this study and suggested that the cost of the PTI study also be capital- PMC Meeting Minutes (BRADNOV) Page 4 of 6 November 30, 1988 ized. Mr. Yerkes suggested that it is appropriate for the cost of Phase I of the PTI study to be funded from the Railbelt Energy Fund, since Phase I addressed alternatives to an intertie and was undertaken by the Power Authority without utility involvement. Mr. Yerkes further suggested that to the extent that the additional PTI scope (i.e., Phases II and III)will op- timize the Bradley Lake Project, the cost of Phases II-III could be capitalized as a part of the Bradley Lake Project. Mr. Yerkes noted that the utility representatives (i.e., TCC) had been asked to participate in the November 29, 1988 meeting with PTI and the Power Authority. Mr. Palin motioned, seconded by Mr. Highers, that the PMC adopt the subject resolution approving capitalizing the cost of the SEI stability study at an amount Not to Exceed $60,000. The motion passed without objection, with Messrs. Le- Resche, Diener, Palin, Highers, Wick, Kelly, and Cooley voting yes, adopting this as BPMC Resolution 88-2. 7.c.1. Status Report on Rural Electrification Administration Approvals. Mr. Saxton referenced his November 18, 1988 memorandum to the BPMC regarding Status Report. Mr. Saxton noted that he had met with REA twice during the past month, including one meeting which Mr. Petrie also attended. Mr. Saxton noted that once the following issues are addressed, REA will require two months to approve the submittal and March 1, 1989 is the earliest date at which Mr. Saxton anticipates receiving REA approval. Mr. LeResche cautioned the Committee that the Alaska Legislature reconvenes in January of 1989 and the PSA is not yet enforceable. 1) The PSA and CEA Services Agreement remain acceptable to REA; however, the position of REA is that they will ap- prove the entire Bradley Lake package at one time, as opposed to approving individual documents/agreements. 2) The HEA Agreement was submitted to REA approximately one year ago; however, this agreement has been reworked. The status of theFritz Creek to Bradley Junction segment of the transmission needs to be determined; at that time the Agree- ment will need to go back before the requisite Boards of Directors for approval and then resubmitted to REA for approval. 3) REA sent letters to GVEA, HEA and CEA asking for additional information. The response by GVEA has been sub- mitted and the response by CEA will be mailed within the next few days. HEA has provided their response in draft form at the request of REA and they are awaiting any comments by REA. Mr. Saxton summarized the status of the required items as follows: Document/Utility Approval REA Informal Approval _—_ REA Formal Approval 1) PSA/Done Informally Approved None 2) CEA Services Agreement/Done Informally Approved None 3) Letter Agreement/All but Seward, CEA, ML&P None None 4) HEA Transmission as Amended/Not final None None 7.c.2.Discussion of Fritz Creek Transmission Line Mr. Mathews distributed copies of Mr. Wick’s November 28, 1988 memorandum to the Bradley Lake Participants, Sub- ject: Bradley Junction-Fritz Creek Transmission with an attached October 28, 1988 report from Commonwealth Associates, Inc. (CAI), Subject: Feasibiltiy of Bradley Junction-Fritz Creek 115 kV Line. Mr. Mathews noted that CAI had reviewed the data from existing studies and concluded that the savings to the purchasing utilities from the potential system losses if PMC Meeting Minutes (BRADNOV) Page S of 6 November 30, 1988 the Bradley Junction-Fritz Creek line is not constructed are high enough to pay for the cost of constructing the line. Mr. Mathews said that HEA is looking for comments from the PMC on this issue and HEA’s proposal as contained in Mr. Wick’s letter. It was noted that a decision is required prior to HEA letting the transmission line contract February, 1989. Mr. Mathews said that HEA does not feel that the absence of this segment will affect stability. Mr. Yerkes said that he dis- agreed completely and that this line segment affects system viability. It was noted that CAI in their cover letter to HEA states, "from the engineering perspective, we would recommend that HEA build the line anyway for the loss savings and improvement in system reliability." Mr. Mathews responded that HEA would defer building this segment at this time due to the cost. Mr. Yerkes suggested that the second transmission line out of the project, as well as other project features, should also be eliminated if this segment is not constructed. Mr. Kelly noted that the CAI report shows that with a 40 MW Bradley Lake Project (i.e., base loaded project) the $323,000 in annual savings to HEA from loss reduction exceeds the $308,000 annual fixed charges and O & M for the Bradley Junc- tion-Fritz Creek segment (reference pages 3 and 4 of CAI 10-28-88 report). Mr. Kelly also noted that according to the CAI report, the annual savings from loss reduction from the Bradley Lake Project operated in a peaking mode are $137,000 directly to HEA and that HEA will recover an additional 12% of $847,000 Bradley Owners Displacement benefits for an underrecovery by HEA of approximately $70,000 (or $308,000 debt service net $137,000 direct benefits to HEA net $101,640 HEA share of project benefits) per year during the first three years (i.e., until load growth south of Soldotna increases). With the understanding that the numbers are preliminary, Mr. Kelly asked Mr. Wick for his response to this philosophy. Mr. Wick responded that he had not had time to thoroughly review the report and was unprepared to respond at this time. Mr. Kelly suggested that Mr. Wick ask the HEA Board of Directors if the $70,000 additional cost per year 1-3 of the Brad- ley Lake Project is good reliability insurance. Mr. Wick said that he will develop a proposal or amendment to the HEA Transmission Sharing Agreement for the PMC to respond to by next week (i.e., December 5, 1988). Mr. Kelly said that an amendment is premature, since the refined num- bers will affect the response of the PMC. It was noted that this issue is on the critical path relative to securing REA ap- provals. Mr. Kelly asked that Mr. Wick notify him when he is ready to address this issue; at that time Mr. Kelly will call a meeting of the managers to address this issue. Both expressed the expectation that this occur within two weeks. 7.d. Discussion of HEA Transmission Services Agreement Mr. Saxton said that the agreement developed by Mr. Baldwin has previously been distributed; however, an amendment is required to explain whether there is a construction obligation on the part of HEA once item 7.c.2. (i.e., Fritz Creek trans- mission line) is resolved (reference draft Transmission Services Agreement distributed via Mr. Baldwin’s 10/17/88 memorandum and Mr. Baldwin’s 11/23/88 memorandum, subject: Amended Agreement). Mr. Kelly suggested that the par- ticipants consider that their respective Boards of Directors will need to address this issue at the end of December, 1988 or early January, 1989. Mr. Palin distributed copies of the October 31, 1988 memorandum from Mr. Yerkes to Messrs. Palin and Ritchey, Subject: Outstanding AEG&T/HEA Issues and Concerns. There was discussion as to whether these issues would be more ap- propriately addressed in an operating agreement. The consensus was for the TCC members to come to their next meeting prepared to deal with these items and report back to the PMC. It was noted that major changes to the HEA Transmission Services Agreement were not contemplated. 8. TECHNICAL COORDINATING COMMITTEE REPORT Mr. Eberle reported that the Configuration Control Board has not met since the last PMC meeting nor have there been any major change orders. Mr. Yerkes, as the TCC’s representative to the Configuration Control Board did visit the site several weeks ago. Mr. Eberle noted that the major excavation for the dam has been completed and that excavation for the manifold system will be complete by January of 1989. PMC Meeting Minutes (BRADNOV) Page 6 of 6 November 30, 1988 9. OTHER BUSINESS Schedule Next Meeting Mr. Kelly said that he would call the next meeting after he hears from Mr. Wick relative to the Bradley Junction-Fritz Creek Transmission segment. Mr. Kelly asked Mr. Wick to distribute to the PMC any information relative to this issue. Mr. Kelly anticipated that the next meeting would occur in December of 1988. 10. COMMUNICATIONS There were no further communications or business. 11. ADJOURNMENT The Committee adjourned at 1:45 p.m. SECRETARY APPROVED AT PMC MEETING HELD _ January 20, 1989 |. BRADLEY PMC RESOLUTION NO. 88-2 A RESOLUTION of the Bradley Project Management Committee (Bradley PMC) providing for payment of stability study costs. WHEREAS, The Bradley PMC authorized Phase I and Phase II of an interconnected system stability study (Stability Study) to be performed by Southern Electric International, Inc.; WHEREAS, $45,000 has been spent on the study to date; and WHEREAS, This is a Cost of Acquisition and Construction under Section 1(1) of the Power Sales Agreement and should be paid out of Project funds; NOW THEREFORE, BE IT RESOLVED, That the costs incurred to perform and complete the stability study, not to exceed $60,000, shall be a Cost of Acquisition and Construction, and one-half of such cost shall be a Recoverable Construction Cost as defined in Section l(ee) of the Power Sales Agreement. ADOPTED by the Bradley PMC at a regular meeting of said Committee held this 30thiay of _November , 1988, BRADLEY PROJECT MANAGEMENT COMMITTEE ow. PDA. FU MICHAEL P. KELLY Name _ Chairman ATTEST: BY: Name Robert E. LeResche Secretary RLSder617 1/9/89 RESOLUTION NO. 89-3 A RESOLUTION of the Bradley Project Management Committee requesting Rural Electrification Administration (REA) approval of all documents relating to the Bradley Lake Hydroelectric Project. WHEREAS, all parties to the Bradley Power Sales Agree- ment have approved the Power Sales Agreement and associated agreements; and WHEREAS, such documents have all been forwarded to REA in final form; and WHEREAS, fully executed copies of all documents will be delivered to REA no later than February 20, 1989; and WHEREAS, all cooperative utilities have provided to REA individual economic justifications of the prudency of their participation in the Project; NOW, THEREFORE, BE IT RESOLVED, that the Bradley Project Management Committee declares all agreements and individual prudency filings to be complete and requests that REA give its final approval of participation by each respective cooperative in the Bradley Power Sales Agreement and associated agreements. BRADLEY PROJECT MANAGEMENT COMMITTEE By: ~Ow, i Michael P. Kelly Chairman ATTEST: By: R LeResche Secretary