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HomeMy WebLinkAboutAEA Board Meeting Feb 24 2006Alaska Industrial Development and Export Authority Alaska Energy Authority 10. AGENDA Alaska Energy Authority Board of Directors February 24,2006 Anchorage and Juneau,Alaska Immediately Following AIDEA Board Meeting CALL TO ORDER BOARD OF DIRECTORS ROLL CALL PUBLIC ROLL CALL PUBLIC COMMENTS PRIOR MINUTES -December 5,2005 OLD BUSINESS NEW BUSINESS DIRECTOR COMMENTS A.Director's Status Report of AEA Programs and Projects B.Next meeting date BOARD COMMENTS 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 wok "AIDEN (=ADSSKAlaskaindustrialDevelopmentWrasExportAuthority ALASKA ENERGY AUTHORITY BOARD OF DIRECTORS MEETING February 24,2006 -1:15 p.m. Anchorage and Juneau,Alaska 1.CALL TO ORDER Chairman Barry called the meeting of the Alaska Energy Authority to order on February 24,2006, at 1:15 p.m.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Directors present in Anchorage:Mr.Mike Barry (Chairman/Public Member)and Mark Edwards (Designee for the Department of Commerce,Community and Economic Development). Director present in Juneau:Deputy Commissioner Tom Boutin (Designee for the Department of Revenue). Director present in Petersburg:Mr.John Winther (Public Member). 3.PUBLIC ROLL CALL Staff present in Anchorage:Ron Miller (Executive Director),James A.McMillan (Deputy Director- Credit &Business Development),Valorie Walker (Deputy Director -Finance),Karl Reiche (Project Development Manager),Mark Schimscheimer (Project Manager),Mike Harper (Deputy Director- Rural Energy),Brenda Fuglestad (Administrative Manager)and Jeff Williams (Administrative Assistant). Others attending in Anchorage:Brian Bjorkquist and Mike Mitchell (Department of Law). 4.PUBLIC COMMENTS There were no public comments. 5.PRIOR MINUTES The December 5,2005 minutes were approved as presented. 6.OLD BUSINESS There was no old business. 7.NEW BUSINESS There was no new business. 813 West Northern Lights Boulevard *Anchorage,Alaska 99503-2495www.aidea.org ©907/269-3000 *FAX 907/269-3044 ®Toll Free (Alaska Only)888/300-8534 *www.akenergyauthority.org 8A.DIRECTORS COMMENTS °Alaska Intertie Update MOTION:Mr.John Winther moved to go into executive session to discuss negotiation points with the IOC utilities related to the Alaska Intertie Agreement.Seconded by Deputy Commissioner Tom Boutin.There being no discussion,the question was called. A roll call vote was taken and the motion passed 4 yeas and 1 absent with Messrs.Barry, Boutin,Winther and Edwards voting yea (Commissioner Barton absent). EXECUTIVE SESSION -1:17 p.m. The Board reconvened its regular meeting at 2:05 p.m. Roll call was taken and a quorum was established.Chairman Barry advised that the Board had not taken any formal action on the matters discussed while in Executive Session. 8B.NEXT MEETING DATES Chairman Barry stated the next meeting date would be in conjunction with the next AIDEA Board Meeting. 9.BOARD COMMENTS There were no board comments. 10.ADJOURNMENT Chairman Barry adjourned the meeting at 2:06 p.m. (A__|Rowe Secretary Alaska Industrial Development and Export Authority ALASKA ENERGY AUTHORITY BOARD OF DIRECTORS December 5,2005,@ 3:00 p.m. Anchorage and Juneau,Alaska 1.CALL TO ORDER Chairman Barry called the meeting of the Alaska Energy Authority to order on December 5,2005, at 3:00 p.m.A quorum was established. 2.BOARD OF DIRECTORS ROLL CALL Directors present in Anchorage:Mr.Mike Barry (Chairman/Public Member),Commissioner Bill Noll (Department of Commerce,Community and Economic Development),and Mr.John Winther (Public Member). Directors present in Juneau:Deputy Commissioner Tom Boutin (Designee for Department of Revenue). 3.PUBLIC ROLL CALL Staff present in Anchorage:Ron Miller (Executive Director),Jim McMillan (Deputy Director-Credit &- Business Development),Valorie Walker (Deputy Director-Finance),Karl Reiche (Project Development Manager),Becky Gay (Project Manager),Brenda Applegate (Accountant),Mark Schimscheimer (Project Manager),Sara Fisher-Goad (Financial Analyst),Chris Rutz (Procurement Manager),Bernie Smith (Project Manager),Linda MacMillan (Accountant),(Brenda J.Fuglestad (Administrative Manager),and Jeff Williams (Administrative Assistant). Others attending in Anchorage:Mike Mitchell and Brian Bjorkquist (Department of Law),Tim Bradner and Margie Bauman (Alaska Economic Report),Bill White (Anchorage Daily News), Robert Sheldon (TATICC/ATM),Jan Sieberts (Washington Capital),David Germer and Jon Rubini (JL Properties,tnc.),Shirley Kelly (USDOC-EDA),Dane Hanson and John Duffy (Mat-Su Borough),Jim Walker (Matanuska Electric Association),Kathy Porterfield and Charlie Kozak (KPMG)and T.N.Obermeyer (Self). Others attending telephonically:Gary Roberts and Mike O'Leary (Callan Associates),Paul Bloom and Jeff Brown (Merrill Lynch),and Pat Clancy (Western Financial Group). 4.PUBLIC COMMENTS There were no public comments 5.PRIOR MINUTES The July 25,2005 AEA board minutes were approved as presented. 813 West Northern Lights Boulevard *Anchorage,Alaska 99503 ANT 1960 ANN @ FAY ANT 1960 AAA @ Tall Fenn (AL ACIZA CYNITVY 2RAQ 1 IAN QEIA arsaninasridan ava AEA Board Meeting December 5,2005 Meeting Minutes Page 2 6.OLD BUSINESS There was no old business. 7.NEW BUSINESS 7A.Financial Statements Ms.Porterfield,Managing Partner with KPMG LLP,summarized the audited financial statements and letter to the Board. She said that because the Energy Authority has significant funding from the Federal Government through the Denali Commission there are additional audit requirements and KPMG has issued reports that the Federal Government requires regarding your compliance with grants.KPMG intends to also issue unqualified opinions on the Authority's compliance with the provisions of its federal grants agreements.KPMG's unqualified opinion should be available next month. She said the purpose of the audit is for KPMG to gain reasonable assurance that the financial statements are free of material misstatement.KPMG conducted appropriate audit procedures and has concluded that the financial statements are fairly stated in all material respects in accordance with generally accepted accounting principles,resulting in an unqualified or a clean opinion.KPMG obtained reasonable assurance during the audit that the financial statements are free of material misstatement. Ms.Porterfield stated that the only change in terms of format of the financial statements was the implementation of new accounting standards with regard to investments.Ms.Porterfield also pointed out the information about the Bradley Lake trust accounts and the supplemental information provided She said the Authority has very good accounting records and it was not necessary to propose any significant audit adjustments.The Authority has an effective system of internal control in place. 7B.Alaska Intertie Update Mr.Miller stated that several issues regarding the Alaska Intertie were discussed at a previous board meeting:problems with the Agreement,projects that the IOC is focusing on,and the status of the pipeline project.He noted that a copy of the snow load monitoring procedureadoptedbytheIOConNovember16"is attached.The IOC had been discussing problems with the Intertie Operating Agreement along with possible amendments to that Agreement.AIDEA is in negotiations with ML&P regarding management and the Intertie Bypass Project.Henri Dale with Dryden &LaRue prepared summary studies on three structure foundations,which we should receive shortly. The IOC has discussed hiring consultants to study upgrade options with regard to the SPC issue.Mr.Smith stated they were still discussing the matter,but that issue is on the agenda for the January 19,2006 IOC meeting. Mr.Miller said that the participating general managers of the utilities requested AIDEA run financing scenarios for Intertie repair and replacement.AIDEA has complied with that request AEA Board Meeting December 5,2005 Meeting Minutes Page 3 but have not had a formal response from the general managers. Chairman Barry said that at a work session with the general managers it was agreed that there were several items on a checklist that had never been checked off and stated that one of the problems in getting those items resolved was not having a financing plan.They asked AIDEA to present a financing plan and we did. Mr.Bjorkquist stated that there has been some discussion on some of the financing points and that if the Board would like to get into the details that would be a topic appropriate for executive session.He said he could give an update on where things are in the negotiations and the Board could give staff direction as to what its pleasure would be.Mr.Bjorkquist also noted,regarding the Intertie Bypass Project,that there are ongoing negotiations on details for the contract and that this is another topic where staff could use some direction from the Board. Chairman Barry asked staff to prepare a report to the Board on those items that were identified in June as being delinquent and whether or not any of them have been addressed and,if not, list some suggestions as to how to get the utilities to address those issues.He stressed that what he meant by "address”was that these issues get resolved and not just talked about. In response to Board member questions,Mr.Bjorkquist addressed Mr.Winther's question and said that under the Agreement,there is no repair and replacement fund or other funded mechanism.The question is how to deal with the concern of funding necessary repairs and replacements and major maintenance as they arise.The details of this topic would also be appropriate for executive session. Chairman Barry stated he would prefer to have an executive session when there is more time available to discuss the issues,as this has been an ongoing issue for a number of years. Hearing no objection Chairman Barry moved on to Item 8A of the agenda. 8.DIRECTOR COMMENTS 8A.STATUS REPORT Mr.Miller stated that budget meetings have been held with the Office of Management and Budget for both agencies. In response to Board member questions,Mr.Miller replied that AEA expects to see a reduction in funds available for its energy programs from the Denali Commission,which is mainly because of the overall decline in funding for the Denali Commission and the increase in earmarks going to the Denali Commission for certain projects. 8B.NEXT MEETING DATES Chairman Barry stated that the next AEA meeting will follow the next AIDEA board meeting. 9.BOARD COMMENTS There were no board comments. AEA Board Meeting December 5,2005 Meeting Minutes Page 4 10.ADJOURNMENT Chairman Barry adjourned the meeting at 3:15 p.m. Ron Miller,Secretary November 16,2005 SNOW LOAD MONITORING PROCEDURE The Snow Load Monitoring System (SLMS)operates continuously for the purpose of advising the Southern Controller of weather conditions that may cause snow to load on the conductors of the Alaska Intertie.This condition creates the possibility that conductors will unload unevenly which may then lead to conductor unbalance that possiblymay then leadto conductor clearance problems.A Patrol Contractor will be retained as part of the Snow Load Monitoring Procedure. The computer system is supplemented by a Patrol Contractor who performs line patrols at the direction of the Southern Controller or after any snowfall of more that 2”over 24 hours measured at the Susitna High School or the Talkeetna Airport unless the Southern Controller determines that a patrol is impracticable.The Patrol Contractor will check and report to the Southern Controller and Alaska Energy Authority by e-mail daily. There is a definitive sequence of events that must occur in order to create clearanceproblemsalongtheAlaskaIntertie.As determined by analysis of previous line models, the weight on the insulator string must increase by an average minimum of 1407 lbs of snow (over the bare conductor weight)must first accumulate on the conductors in a number of spans to create the possibility for clearance problems which will trigger analarmontheSLMS.Then the snow must unload from a number of spans but not from all the spans.This creates a situation that may or may not cause a ground clearance problem. If the SLMS indicates the Intertie has one or more load cells in alarm the Southern Controller shall (1)advise all Intertie participants of the conditions,and (2)immediately initiate de-energizing the Intertie,consistent with prudent utility practices.Under normal circumstances,it is anticipated that the Intertie would be de-energized within 2 hours after a load cell alarm.The Intertie will remain de-energized until a patrol is completed and it is determined that there is no conductor clearance problem. GVEA Henri Dale pA ML&P DougHall _{ CEA John Cooley afou < AEG&T Frank Bettine ee a Zan O AEA Bemie Smith <Cenee