The URL can be used to link to this page

Home My WebLink AboutBPMC Meeting Dec 18 2012 2Bradley Lake Project Management Committee Meeting ALASKA ENERGY AUTHORITY Special Meeting - Teleconference Public Notice Bradley Lake Project Management Committee Notice is hereby given that the Bradley Lake Project Management Committee will hold a special meeting on Tuesday, December 18, 2012 at 2:30 p.m. via teleconference regarding the approval of the FY 2012 audit/refund. For additional information contact Brad Evans, Chairman. This meeting will be conducted by electronic media pursuant to AS 44.88.050(a) and AS 44.62.310 at the following location: Alaska Energy Authority Aspen Room, 813 West Northern Lights Boulevard, Anchorage, Alaska; Teleconference information: Dial 1-800-315-6338, enter code 3074#. The public is invited to attend. The State of Alaska (AEA) complies with Title Il of the Americans with Disabilities Act of 1990. Disabled persons requiring special modifications to participate should contact AEA staff at (907) 771-3074 to make arrangements. Attachments, History, Details Attachments Details None Department: Revision History Category: Created 12/7/2012 5:22:10 AM by tawebster Sub-Category: Modified 12/7/2012 2:22:10 PM by tawebster Location(s): Project/Regulation #: Publish Date: Archive Date: Events/Deadlines: Commerce, Community and Economic Development Public Notices Statewide 12/7/2012 12/19/2012 12/18/2012 5:30am BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING SPECIAL MEETING Alaska Energy Authority, Anchorage, Alaska December 18, 2012 A; CALL TO ORDER Chair Evans called the special meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 2:30 p.m. 2. COMMITTEE MEMBERS ROLL CALL Cory Borgeson Golden Valley Electric Association (GVEA) Bryan Carey Alaska Energy Authority (AEA) Harvey Ambrose Homer Electric Association (HEA) Brad Evans Chugach Electric Association (CEA) Joe Griffith Matanuska Electric Association (phone) (MEA) Richard Miller Anchorage Municipal Light & Power (phone) (AML&P) 3. STAFF/PUBLIC ROLL CALL Henri Dale (GVEA); Brian Hickey (CEA); Gary Dixon, Swalling & Associates; Kelli Veech, Teri Webster, and Sandie Hayes (AEA); Participating by phone: Burke Wick and Mike Cunningham, (CEA); Brian Bjorkquist,(Department of Law); Kirk Gibson (McDowell Rackner & Gibson PC) 4. PUBLIC COMMENT There were no public comments. 5. AGENDA COMMENTS/MOTION FOR APPROVAL The agenda was unanimously approved. 6. APPROVAL OF PRIOR MEETING MINUTES - September 26, 2012 The September 26, 2012 meeting minutes were unanimously approved as amended. T NEW BUSINESS 7A. Approve FY12 Audit Report and Refund FY12 Budget Surplus to Utilities Mr. Dixon gave an overview of the Swalling & Associates 2012 Audit report. He said KPMG audits AEA funds for the Bradley Lake Project and Swalling & Associates uses their financial statements and looks at a more detailed level. They look to make sure that the policies and procedures are BPMC Minutes 12/18/2012 Page 1 of 2 being applied consistently since that’s the premise for having comparative information. They did not propose any adjustments. Mr. Dixon explained how the refund to the utilities is broken down. The Renewal & Contingency Fund (R&C) is capped at $5M. Funds over that becomes the benchmark for refunds and in 2012 the fund it was over by $773,897.73. Chair Evans asked if the amount of $773,897.73 that is going to be allocated to the R&C fund includes the recovery of the $670,000 to the Battle Creek Project. Ms. Veech responded that the $670,000 is not included in this figure. Chair Evans asked if the reserve fund can be increased from $5M. Ms. Veech responded that it has been raised in the past for a particular project but must be approved by the trustee. Chair Evans inquired what the drivers were behind the surplus amount. Mr. Dixon stated that besides the surplus of $794,000 from the utility contributions and the surplus of $585,000 from operating and maintenance expenses, the rest was a composite. One example was the State renewable energy grant spent $22,000 vs. the $500,000 budgeted. Mr. Griffith moved that the Bradley Lake Project Management Committee (BPMC), accept the fiscal year 2012 Audit Report and approve a total refund of $1,568,635.67 to the utilities. This is broken down as $794,737.94 to Operating & Maintenance, and $773,897.73 to Renewal & Contingency Fund. Motion was seconded by Mr. Ambrose. ROLL CALL VOTE: The motion passed unanimously. 8. Adjournment The meeting adjourned at 3:35 p.m. BPMC Minutes 12/18/2012 Page 2 of 2 Public Comment: None Motion for approval of agenda Harvey 1* Second Joe Motion of minutes Harvey 1° second Henri Minutes change — Bryan Carey - One minor under seven a 2™ paragraph. Has USDGS s/b USGS September 26 min approved. New Business FY2012 Audit Action Item Motion Joe 1* Motion — Mike - Swalling & Assoc completed audit on time and everything went smoothly and | believe that they are here to cover the results of the audit with the committee so | will turn it over to them. Chair - Before you do that, is the 773 that is going to be allocated to renewable contingency fund — Does that recover what we previously moved to sweep some funds from here over to the Battle Creek project —is that a replacement of that? No that was an over accrual or over-reimbursement back to the RSP fund. Chair — Oh is that what is coming back out of it? Mike does that take into account the money we swept over to Bryan? Mike —| believe so. There was that much more in addition to what we moved over to Bryan. Kelli —It was 670 to Battle Creek and this is above that and the 670 is going to stay in there and as he spends the money this year that is the fiscal year 2013. So this is not anticipating that drain. Kelli—no - we are required to refund it at the end of the year. So you guys can’t do an encumbrance on those funds and say their gone? Kelli — no not according to the plan. Chair — I’m just checking — want to know how it works. Swalling - do you want me to Chair — yes you can speak to the audit or the refund ~ Swalling — yes we can touch a little more on the refund | suppose. It was broken out in the motion probably in two numbers because as Kelli mentioned the 773 will get returned to the operating fund from the RNC fund but for purposes of money back to the utilities it will would just aggregate into one total so it was more for presentation purposes and so that RNC amount gets capped at 5 mill so the funds over that becomes the benchmark for refunds so in this case it was over and that was the amount of the overage that is coming back. Chair — Can the BPMC raise that amount? Or is that written in an agreement in such a way that no one can raise that 5 mill if we wanted to build up a larger reserve fund? Kelli— We can however the bond resolution or | think you’ve done this in the past, where the agency has approved an amount higher for a specific project however there is something that has to be approved by the trustee because of the high interest rate (7.38) So | suspect you wouldn’t be able to say we want 10 mill earning 7.38%. Chair - Who is paying us the 7.38%? It’s the investments. So that would be the stipulation. You could say raise it up for this particular project but you would have to get their approval. Swalling — That’s probably the only thing that looks different on the financial statements so our auditor’s report is unqualified because we did not see anything that required adjustment so we had worked through the stuff that we just talked about with Kelli. The regular part of the refund that doesn’t involve the money coming back from RNC was the $794 that matches the amount in the motion. Otherwise if you were to walk through the budget to actual amounts | think in the prior year there was one budget amendment during the year. What you started with budget wise is what you ended up with If you go to the last page, page 12 the budgeting seems to be fairly closer to actual obviously the projects you do is what cause the variation so some years it is rather significant. There was only the $500,000 state grant that took effect this fiscal year there was only 22,000 that was charged through to this grant so | am assuming that later in the summer there would have been more money Otherwise the financial statements themselves read very similar to the past the only areas that are different are the areas we already talked about otherwise the tendency is to leave the wordings the dame since these are special purpose financial statements since you are the group that uses them . As far as the audit goes itself, there are a few obligatory items | can cover We look to make sure that the policies and procedures are being applied consistently since that’s the premise for having comparative information going forward. We did not propose any adjustment to the books. Each time we go in we look at each individual transaction. These transactions are different each time as they relate to operating expenses other things we confirm are the funds that are held in the investments and we go through other expenditures —that are running through these financial statements and we did not have any exceptions this time. We get representation signed by both Mike Cunningham and Kelli relative to their involvement and the belief that the numbers are correct. KPMG audits AEA and so funds for Bradley lake are covered in those financial statements so we are just auditing the arbitrating operating and revenue funds that are a subset so we are looking at more detail level than they would have been with their audit. , | think that’s mainly what | wanted to cover, | don’t know if there were questions anyone has at this point. Chair - Can you please cover the drivers for the surplus? If you go back to page 12 — because basically you wouldn’t get money back without having the areas of the budget where your expenditures were less than the actual. So they were kind of disbursed this time. Some years there’s been some particularly large items but in my mind there wasn’t so much of any one thing if you look at the largest one you'll see in the back would be in the hydraulic power generation operation line item that | don’t remember without — we’d have to go back through to what was budgeted — what wasn’t spent is what it really amounts to . So you get an accumulation of conservative budgeting probably. | don’t think there was one particular item Chair — Maybe |’m just missing it — | didn’t see where we got over to the $1 million. You got $500,000 from the operating expense side and then another .... Swalling — If you go to page 3 the $794 piece that we’ve been talking about is coming off of the $16 mill dollar contributions budget so that’s adjusting to get you back to your $794 - it sort of a self-zeroing thing so | probably should have taken you to that page first. So then the $585 becomes one component, the interest was different than budgeted and working backwards to the budgeting side of it there’s a variance there , then the state grant was budgeted at $500 and only $22 was spent. So you work your way down that schedule. Chair — anything from the members? Alright, since it’s a budget money item, we'll have to do a roll call on the vote. So indicate your approval by saying Aye after your name or association is called MEA — Yes ML&P — Yes GVEA — Yes (Cory) AEA — Yes HEA — Yes CEA — Yes Motion Passes Motion for adjournment 3:35 pm Bryan 2™. ATTENDANCE - BPMC REGULAR MEETING, Dec 18, 2012 @ 2:30 pm COMMITTEE MEMBERS /. Brad Evans, Chairman Brad Janorschke, Vice Chairman y v-. Bryan Carey, Secretary/Treasurer ¥ -~ Corey Borgeson 2°.4WO Y James Posey Y John Foutz ALTERNATE CEA _~ Burke Wick PNone HEA v Harvey Ambrose AEA Sara Fisher-Goad GVEA =HenriDale Gnas — MLP vu Richard Miller prove SEW Jeff Estes v/ EvanJoeGriffith gnors MEA Gary Kuhn — Mike Cunningham, CEA Jim Kingrey, HEA Gary Dixon, Owallinos Assoc, Brien Vacky, CEA AIDEA AEA —_—AIDEA and AEA Staff v-__ Webster, Teri _ Sandie Hayes ~~ Kelli Veech Weems, Shelby AIDEA AEA enone + AIDEA and AEA Staff — Kirk Gibson, McDowell Rackner & PAO 7 Gibson PC — Brian Bjorkquist, Dept of Law ehouz, Va AIDEA AEA AIDEA and AEA Staff BPMC TUESDAY, DEC 18, 2012 @ 2:30 P.M. **PLEASE WRITE LEGIBLY** GARI P/XOW SWALLING PAESCC | Bb. Var oe RLra Brun there a CHdenCit eth. Veocr HEA = ALASKA. = ENERGY AUTHORITY BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE SPECIAL MEETING (Teleconference) DRAFT AGENDA Tuesday, December 18, 2012 — 2:30 p.m. Alaska Energy Authority’s Aspen Room 813 West Northern Lights Boulevard, Anchorage, AK ie CALL TO ORDER 2: ROLL CALL (for Committee members) 3. PUBLIC ROLL CALL (for all others present) 4. PUBLIC COMMENT 5. AGENDA COMMENTS / MOTION FOR APPROVAL rt a \j cvey lst 6. APPROVAL OF PRIOR MEETING MINUTES — September 26, 2012 ee 2nd Harvey lst 7 NEW BUSINESS Wenry Zed A. Approve the FY 2012 audit / refund (Action Item) 8. ADJOURNMENT pon. Cary 2nd To participate by teleconference, dial 1-800-315-6338 and use code 3074#. 813 West Northern Lights Boulevard e Anchorage, Alaska 99503 www.aidea.org ¢ 907/771-3000 e FAX 907/771-3044 e Toll Free (Alaska Only) 888/300-8534 ¢ www.akenergyauthority.org