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Home My WebLink AboutBPMC Feb 2, 2018BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING REGULAR MEETING Alaska Energy Authority,Anchorage,Alaska February 2,2018 a\O Chair Janorschke called the regular meeting of the Bradley Lake Hydroelectric ProjectManagementCommitteetoorderat10:31 a.m. 1.CALL TO ORDER 2.ROLL CALL FOR COMMITTEE MEMBERS Brad Janorschke (Homer Electric Association [HEA]);Janet Reiser (Alaska Energy Authority [AEA]);Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association [MEA]);Mark Johnston (Anchorage Municipal Light &Power [ML&P]);Cory Borgeson (Golden Valley Electric Association [GVEA]);and John Foutz (City of Seward). 3.PUBLIC ROLL CALL Amy Adler,Brenda Applegate,Tom Erickson,Jocelyn Garner,David Lockard,Carmen Noble, Kirk Warren,Teri Webster,Brandi White (AEA);Josh Resnick,Burke Wick (CEA);Brian Bjorkquist (Department of Law);Leo Quiachon (phone)(GVEA);Bob Day,Larry Jorgensen (HEA);Kirk Gibson (McDowell Rackner Gibson,PC);Emily Hutchinson (phone),Tony Zellers (MEA);Molly Morrison,Jeff Warner (ML&P);Bernie Smith (Public);and Ladonna Lindley (Accu- Type Depositions). Chair Janorschke welcomed Ms.Reiser to the Bradley Lake Project Management Committee. 4,PUBLIC COMMENTS None. 5.AGENDA APPROVAL MOTION:Mr.Johnston made a motion to approve the agenda.Motion seconded by Mr. Thibert. Mr.Gibson requested to amend the agenda by adding an Executive Session to dicuss financial considerations with respect to Battle Creek. The amended agenda was unanimously approved to include the Executive Session to discuss financial considerations with respect to Battle Creek. 6.PRIOR MINUTES -Dec.1,2017;Dec.6,2017;Dec.13,2017 MOTION:Mr.Johnston made a motion to approve the minutes of December 1 and December 6,2017.The motion was seconded by Mr.Izzo. Chair Janorschke informed he will provide Ms.Webster with non-material changes,including the correct spelling of names. BPMC Minutes 2/2/18 Page 1 of 5 Motion passed unanimously. MOTION:Mr.Johnston made a motion to approve the minutes of December 13,2017. The motion was seconded by Mr.Izzo. Chair Janorschke informed he will provide Ms.Webster with correct spelling of names. MOTION:Mr.Thibert made a motion to modify the second paragraph on page two of two to reflect the intent and decision at the meeting,from,"Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put ina pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages,”to:"The non-participating utility, GVEA (16.9%),will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities original project capacity percentages.All original ML&P Battle Creek shares are allocated to HEA.These allocations were done by agreement.”Motion seconded by Mr.Johnston. Motion to amend the minutes passed unanimously. Mr.Izzo informed the reference to Chair Thibert in the minutes could be corrected to read Acting Chair Thibert. Motion to approve the amended minutes of December 13,2017 passed unanimously. 7.NEW BUSINESS A.Battle Creek Diversion Project Update Mr.Gibson recommended the resolution passed during the December 13,2017 meeting be modified to provide clarity for future consideration and to reflect the will of the Committee regarding the rights of shares that transfer.Chair Janorschke requested Mr.Gibson bring an amendment to the resolution before the Committee at the next meeting. Ms.Reiser informed the Battle Creek Diversion Project update is provided in the member packets. Chair Janorschke noted one item of previous discussion regarded the participants being fully engaged and augmenting AEA's project management.Chair Janorschke indicated HEA could provide a project manager onsite this year at cost and run it through the Battle Creek Project. Mr.Thibert,Mr.Borgeson,Mr.!zzo and Mr.Foutz expressed support for the proposal.Chair Janorschke advised HEA will proceed with the proposal of providing an onsite project manager. The intent is for the representative to report to the BPMC. Mr.Borgeson requested a copy of the Battle Creek Orion Marine contract be emailed to BPMC members. B.West Fork Upper Battle Creek FY18 Budget Ms.Garner reported members were provided the Bradley Lake Project budget and amendment, which includes costs for the Battle Creek Project that are outside of the financing.She informed the costs will be paid for by the Battle Creek participating utilities.Ms.Garner reviewed the budget amendment. BPMC Minutes 2/2/18 Page 2 of 5 MOTION:Mr.Thibert made a motion to approve the second amendment to the fiscal year2018BradleyLakeHydroelectricProjectbudget.This includes an increased budget of$968,642 for debt services payments and administrative costs of the West Fork Upper Battle Creek project to be paid for by the Battle Creek Participating Utilities.Mr. Johnston seconded the motion. Mr.Thibert requested an explanation of the increase in debt service for Battle Creek line item. Ms.Garner informed the $895,825 is the first interest payment due on July 1,2018.Mr.Thibert asked what the timeframe for the $43,000 Battle Creek administrative costs encompasses.Ms. Garner indicated that line item covers the six months from the start of finance on December 26, 2017 through June 30,2018.The FY19 budget will include the full annual cost. Mr.Borgeson requested explanation of how the CREBs (Clean Renewable Energy Bonds) refund will reduce the interest owed.Ms.Applegate gave a description of the process for receiving the CREBs subsidy credit.The filings will be completed by U.S.Bank and are due 45 days prior to the interest payment date.The CREBs subsidy credit is subject to sequestration. A roll call vote was taken,and the motion passed unanimously. Cc.Surplus Bradley Equipment Mr.Day reported on the State's current surplus equipment at Bradley.He requested members give direction as to the methodology of disposal of the surplus items.Mr.Day suggested following the surplus rules used internally by HEA,which includes selling smaller items on Craigslist and possibly conducting an auction for the larger items. Mr.Erickson noted disposal of any assets owned by AEA will have to be completed by AEA and could include an auction.Mr.Bjorkquist informed proceeds from the sale of surplus Bradley assets are rolled back into the Bradley budget. Ms.Reiser recommended Mr.Erickson review the current disposal procedures and promptly work with Mr.Day on a disposal plan.Mr.Thibert and Mr.Borgeson agreed with the recommendation for Mr.Day to work with Mr.Erickson on a disposal plan.The final disposal plan does not need to be brought in front of the Committee.Mr.!zzo suggested the planning begin without delay to capture barging opportunities. 8.REPORTS e O&D REPORT -ML&P Chair Janorschke expressed appreciation to Mr.Warner for the advanced written copy of the O&D Report.Mr.Warner informed the O&D Committee meets monthly.Recent meeting discussions have been focused on system issues,particularly the Bradley spin contribution. The ongoing discussions and determinations will encompass the findings of the lOC and the System Studies Subcommittee (SSS)regarding different resources within the system.Mr. Warner advised the data received from the SSS indicates Bradley Lake does not have governor response before minimum frequency is reached.Mr.Warner noted the utilities do not rely heavily on Bradley spin for the purposes of the two to five-second range.Bradley spin is relied on to respond in the 10-minute recovery period time. Mr.Warner reviewed the upgrades to the fish water automation.The next step is to provide the software to control the fish water release.A bid has been received from Emerson for $157,000. BPMC Minutes 2/2/18 Page 3 of 5 The O&D directed HEA to move forward with the work.Mr.Warner believes the project is worthwhile and anticipates the automation will reduce the current 30 percent over-release. Mr.Warner stated preliminary discussions regarding the project O&M cost study allocation have occurred and will be addresed again at the next meeting.Mr.Warner indicated the request from CEA for a day-ahead schedule has been very helpful and appreciated.Each participant has the ability to review the schedule and determine if opportunities exist to buy capacity from another participant.Mr.Warner reported a preliminary budget discussion will occur at the next meeting. e OPERATORS REPORT Mr.Day directed the members to the Operator's Report provided in the packet and noted it was prepared on January 19"in anticipation of the meeting that was cancelled.Mr.Day informed the uninterruptible power system (UPS)experienced a significant problem at the beginning of January.After three days of system repair,the UPS is back in full operation.Mr.Day stated the LED lights in the power house are performing very well.He noted the occupancy sensor function translates to less station service and the electricity savings over two years is expected to cover the expenditure.Mr.Day informed additional lighting will be included in next year's budget. Mr.Thibert asked if the operator is working with the O&D Committee regarding solutions to the issues with the governor.Mr.Day stated review with Emerson has occurred to ensure proper operation.Mr.Day believes the inherrent response delay from Bradley Lake is due to the physical characteristics and the paradoxical motion of the initial reduced pressure at the needle face until water acceleration occurs.Bradley Lake is considered comparable to a 27-megawatt gas turbine spin.The SSS committee is reviewing the validity of the comparison. 9.COMMITTEE ASIGNMENTS Chair Janorschke invited all interested parties to the Battle Creek Project kick-off on Thursday. He informed the Finance Committee will review the 2019 Draft Bradley Lake Budget on February 16,2018,which will come before the full BPMC at the next meeting. 10.MEMBERS COMMENTS Mr.Izzo expressed appreciation to AEA staff for their efforts on CREBs and the Battle Creek Project. Mr.Thibert expressed appreciation to Ms.Garner,Ms.Applegate,Mr.Warner,and Mr.Day for the preparation of their respective reports. Ms.Reiser expressed appreciation to members for their patience while she learns the details of the operation. Chair Janorschke expressed appreciation to Ms.Webster for her efforts. 11.|NEXT MEETING DATE The next meeting is a scheduled on Monday,March 5,2018. MOTION:Mr.Johnston made a motion to go into Executive Session to discuss confidential financial conditions with respect to Battle Creek.Mr.Foutz seconded the motion. BPMC Minutes 2/2/18 Page 4 of 5 Motion passed without objection. 11.5 EXECUTIVE SESSION:11:31 a.m. The Committee reconvened its regular meeting at 11:43 a.m. 12.ADJOURNMENT There being no further business for the committee,the meeting adjourned at 11:43 a.m. a Brad Janorschke,-Chiair mies IL Et1JaneyRefserAlaskaEnergyAuthority,Secretary BPMC Minutes 2/2/18 | Page 5 of 5 11. 12. BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING Friday,Feb 2,2018 10:30 A.M. Alaska Energy Authority,Board Room 813 W.Northern Lights Boulevard,Anchorage,Alaska To participate VIA TELECONFERENCE-1-888-585-9008 -Conference room code 708 329 368 AGENDA CALL TO ORDER ROLL CALL FOR COMMITTEE MEMBERS PUBLIC ROLL CALL PUBLIC COMMENTS AGENDA APPROVAL PRIOR MINUTES -Dec 1,2017;Dec 6,2017;Dec 13,2017 NEW BUSINESS A.Battle Creek Diversion Project Update B.West Fork Upper Battle Creek FY18 Budget AEA Back up detail for page 16 C.Surplus Bradley Equipment HEA REPORTS ¢O&D REPORT -ML&P e OPERATORS REPORT COMMITTEE ASSIGNMENTS MEMBERS COMMENTS NEXT MEETING DATE -Monday,March 5,2018 ADJOURNMENT BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING REGULAR MEETING Alaska Energy Authority,Anchorage,Alaska December 1,2017 1.CALL TO ORDER Chair Janorschke called the regular meeting of the Bradley Lake©Hydroelectric ProjectManagementCommitteetoorderat10:03 a.m.a 2.ROLL CALL FOR COMMITTEE MEMBERS Cory Borgeson (Golden Valley Electric Association [GVEA]);Bryan Carey (Alaska Energy Authority [AEA]);Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association [MEA]);Jeff Warner (Anchorage Municipal Light &Power [ML&P]);John Foutz (phone)(City of Seward);and Brad Janorschke (Homer Electric Association [HEA]). e 3.PUBLIC ROLL CALL Amy Adler,Brenda Applegate (phone),Tom Erickson (phone),Kirk Warren,Teri Webster,Brandi White (AEA);Crystal Enkvist (Alaska Power Association);Brian Hickey,Sherri Higher,Mark Johnson,Josh Resnick (CEA);Brian Bjorkquist (Department of Law);Leo Quiachon,Ron Woolf (phone)(GVEA);Bob Day,Alan Owens (phone),Larry Jorgensen (HEA);Cynthia Cartledge (Jermain,Dunnagan &Owens);Kirk Gibson (McDowell Rackner Gibson,PC);Matt Reisterer, David Pease,Tony Zellers (MEA);Molly Morrison (ML&P);Fred Eoff (phone)(PFM Group Consulting);TW Patch (Public);Bernie Smith (Public);Gary Dixon,Lee Wassilie (Swalling &Associates);and Sydney Hamilton (Accu-Type Depositions).4.PUBLIC COMMENTS ne oe aNone.oe ea ,a 5.AG EN DA APPROVAL.MOTION:Mr.Carey made a motion to add two items under 7D-Clarification Amendments and Proposal by GVEA to Resolution 2017-02;and add an Executive Session to discussdrafttermsheetsandnegotiatedstrategy.Motion seconded by Mr.Thibert.The amended agenda'was unanimously approved.6.APPROVAL OF PRIOR MINUTES MOTION:Mr.Izzo made a motion to approve the minutes of September 29,2017,and October 13,2017.Motion seconded by Mr.Thibert. Motion passed unanimously. 7.NEW BUSINESS DRAFT BPMC Minutes 12/1/17 Page |of 6 A.Approval of Annual Audited Financial Statements Chair Borgeson introduced Mr.Dixon of Swalling and Associates to review the June 30,2017, Financial Statements of the Operating Fund and the Revenue Fund.Mr.Dixon stated members were provided copies of the financial statements and noted they are posted to the AEA website. Mr.Dixon informed the statements'sole purpose is for the Committee to know and approve the refunds for the member utilities.The statements do not have to follow generally accepted accounting principles.The auditing is conducted under generally accepted auditing standards relevant to special-purpose financial statements.The statements were created in the same manner as prior years.No adjustments were made in the sequence of events and no difficulties were encountered with AEA staffin retrieving information.The statements include supplementaryinformation.The opinion is not modified.,Mr.Dixon gave a detailed analysis of each page of the oe 2017 Payable to Utilities O&M refund is $1,223,409.The 2017 Payable to Utilities R&C refund is $1,147,663.Both payables will be brought before the Committee for approval |inaresolution laterin the meeting.Mr.Borgeson inquired as to the reason for theiincrease in Due to Others from $15,048in 2016 to$622,007in 2017.Mr.Dixon believes the difference reflects a timing issue in June of when payables came in and were booked,but not yet reimbursed.Mr.Dixon stated he will take the listfromtheprioryearandcompareit,and report back to the Committee.Mr.Borgeson asked if the efforts for Battle Creek are included iin this audit.Mr.Dixon advised the original events went through the R&C Fund.The funding from the Participating utilities has beensegregatedandisnotincludedjinthisaudit.... Mr.Dixon expressed appreciation to Ms.Applegate,Ms.Garner,Ms.Adler,and staff for theirparticipationintheprocessandcontinueddiligenceforBPMC.Chair Janorschke expressedappreciationadditionallytoMr.Woolf and the Finance Committee for their work.MOTION:"Mr:Borgeson made a motion to accept the FY17 Audited Financial Statementsandapproveatotalrefundtotheutilitiesof$2,371,072,of which $1,223,409 from O&M and$1,147,663 from R&C funds.Mr.Izzo seconded the motion.Motion passed unanimously.B.Operator RFP update Mr.Carey informed MEA and ML&P will not be submitting an RFP for operator.Both utilities have submitted a representative for the working group to develop the scope criteria for evaluating proposals.Mr.Carey provided and reviewed the draft schedule for the procurement.The scope and criteria could be completed by the end of January.The due date could be April 1.The contractor might be known in May and could be ready to take over on January 1,2019.The HEA contract ends on December 31,2018. Cc.Soldotna SVC O&M Agreement update Chair Janorschke informed the SVC O&M Agreement expired the end of 2013,and CEA has continued to maintain the O&M.HEA will take over the service as of January 1,2018.The draft DRAFT BPMC Minutes 12/1/17 Page 2 of 6 agreements are being reviewed.The final agreement is anticipated to be distributed to the Committee about a week before the January BPMC meeting,at which time,it will be addressed. D.Battle Creek e Project Update Mr.Carey noted the bid opening was held on November 8th,and drew in six contractors.The low bid of $36.5 million came in from Orion Marine Contractors.The engineer's estimate came in at $38.1 million.The Notice of Intent to Award cannot be given until financing is in place.Mr.Carey relayed anecdotal information on Orion Marine Contractors,noting good performance on a currentprojectinJuneau.' Mr.Carey informed he has the list of subcontractors,but may not be able to release them at this time.State procurement officers have requested Orion Marine Contractors provide references. Mr.Erickson stated the evaluation process includes review of references,prior projects,financial information,equipment financing,insurance and bonding.Mr.Carey noted he can keep theBPMCapprisedoftheongoingvettingprocess.-So e Contract Housing ApprovalMr.Warner,as Chair of the O&D Committee,informed BPMC asked for the Committee to reviewpossiblehousingneedsfortheprojectsupportstaff.The option for support staff to stayin the crew's quarters at Bradley Lakeis suggested to be set at$65 a night per person.The contractorswillhavetheirowncamp.:. MOTION:Mr.Thibert made a mation to approve the useof the Bradley Project facilities bythesupportcontractors5atarateof$65 per person per night.The motion was seconded.Mr.Warner stated the usee of the crews's'quarters by project support staff poses no concern ofinterferencewiththeoperation.Use of the kitchen |is included iin the terms.Foodis not included.Motion passed unanimously.*_,ag*,|°Clarification Amendments and proposal to Resolution 2017-02 Mr.Gibson cited inconsistencies iin Resolutions 2017-02.He provided a red-line document to address the clarifications and capture the intent of the BPMC.The first proposed change is on page three,to delete "tentatively November 8,"and replace "November 30"with "December 6,"as the date upon which participation should be noticed.The next proposed change is to clarify the next to the last Be It Further Resolved,with respect to what amounts a non-participating purchaser would have to pay to becomea participating purchaser.The recommendation is to remove the word "including"and replace with "to include only,”and then list the particular items that a non-participating purchaser would have to pay. Mr.|zZo expressed concern regarding the phrase "to include only,"because it removes BPMC's ability to address potential unforeseen risks that are not specifically stated in the language. MOTION:Mr.Borgeson made a motion to adopt the changes in the first amendment to Resolution 2017-02 Battle Creek Diversion Project.Mr.Warner seconded the motion. DRAFT BPMC Minutes 12/1/17 Page 3 of 6 Mr.Gibson advised all unforeseen circumstances that were financed will be shared by newly participating purchasers upon buy-in. Mr.Borgeson stated the language provides significant clarity on what is included for future participants. MOTION:Mr.Izzo made a motion to amend the motion to adopt the changes in the first amendment to Resolution 2017-02 by removing the words,"include only,"and go back to the original wording of,"including."Mr.Thibert seconded the motion. Mr.Thibert commented he understood the original motion language was deliberate and intendedtospecificallyincludeonlytheitemslisted.aa Mr.Warner believes the specific language was chosen totary intent.Motion to amend the motion to adopt the changes iinn the first amendment to Resolution2017-02 by removing the words,"include only,"and go back to the original wording of,"including,”failed,with Mr.Izzo and Mr.Foutz voting in favor.: Motion to adopt the changesin the first amendment to Resolution 201 7-02 Battle CreekDiversionProjectpassedunanimously.eee ee Mr.Gibson informed GVEA proposed an 'amendment regarding the sale or transfer of BattleCreekDiversion(BCD)shares to and from participating and non-participating purchasers.The amendment wording was provided to members and insertedin two sections of the resolution.Thelanguageispermissiveandallowsnon-participating purchasers to sell or transfer their right toparticipate.As itis written,the non-participating purchaser has to give notice and buy-in tobecomeaparticipatingpurchaserbeforetheycannsellortransfertheirshares.MOTION:Mr.Borgeson made a motion to addthe proposed language to the first amendment to Resolution 2017-02 Battle Creek Diversion Project regarding the ability for anon-participating utility to sell their right to participate to a participating or non-participating purchaser.Mr.Warner.seconded the motion.Mr.Thibert expressed opposition to the motion because he does not believe the non-participating purchasers have the right to sell or transfer shares they do not own.The decision to participate or not participate has to be made by December 6thin order to continue with 100%financing.Mr.Thibert understands a non-participant can becomea participant at a later date and subsequentlyselltheirshares.° a MesMr.|zzo expressed wei to!the motion because he does not believe a non-participant can sell their value without having paid in. Mr.Warner agreed with Mr.Gibson that the amendment removes one step of the process of transfer or sale of shares and the ultimate result is the same with or without the amendment. Aroll call was taken,and the motion to add the proposed language to the first amendment to Resolution 2017-02 Battle Creek Diversion Project regarding the ability for a non- participating utility to sell their right to participate to a participating or non-participating purchaser failed,with Mr.Borgeson,Mr.Warner,and Mr.Foutz voting in favor. DRAFT BPMC Minutes 12/1/17 Page 4 of 6 e Battle Creek Financing Q&A Mr.Eoff gave a comprehensive overview presentation on the Battle Creek financing.After review of the loan proposals,National Rural Utilities Cooperative Finance Corporation (CFC)was selected for financing.The loan commitment on the term sheet is $47 million,bifurcated into three series to accommodate the success of garnering interest rate subsidy programs.Series A of $40 million is connected to an interest rate subsidy through the New Clean Renewable Energy Bonds (NCREB)program at 70%of the basis rate,subject to a 6%sequestration holdback. Mr.Eoff explained Series B is expected to be connected to an allocation from the State of Alaska for about $2.1 million under the Qualified Energy Conservation Fund program at 70%of the basis rate.The State Bond Commission will meet on Dec 4 to review our request.Series C of about $4.8 million is the balance of the total loan commitment at the CFC loan interest rate and will only be drawn for project costs.Thereis a reasonable chance the Battle Creek project may becompletedwithouthavingtodrawanyoftheSeriesCloan.NO Mr.Eoff reviewed the financials under each of the scenarios provided.Financing proceeds are anticipated to be applied to transaction expenses..Mr.Eoff noted he has been informed the utilities have elected to fund the capital reserve fund through a cash call.Mr.Eoff reported the tax bill Congressis currently trying to pass may create apotential sequestration impact on the interest rate subsidy program relating to the Pay-As-You-Go (PAYGO)statutory restriction from 2010.He explained an exception to the restriction could be passed with 60 votes in the Senate.Another potential impact to the interest rate subsidies could be triggered from the likely significant federal deficit associated with the tax bill.Mr.EoffcommentedthehopeandexpectationisCongresswilldetermineasolutiontothePAYGOrestriction.==.we a Mr.Borgeson inquired as to the cost of power if the interest rate subsidy was not available.Mr. Eoff indicated the average cost of power over 30 years under the optimal scenario with the full benefit of the interest rate subsidy is approximately $58 per megawatt hour.With no interest rate subsidy under the optimal scenario,the average cost of power is approximately $76.30 per megawatt hour.Under the full draw scenario over 30 years,the average cost per megawatt hour increases from $65.60 to $85.*MOTION:Mr.Carey made a motion to go 'into Executive Session to discuss confidential term sheets and negotiating strategy.Mr.Borgeson seconded the motion. Motion passed without objection. °Executive Session:11:53 am. The Committee reconvened its regular meeting at 12:26 pm. 8.COMMITTEE REPORTS 0&D Committee Mr.Warner reported the O&D Committee discussed the O&M cost analysis assignment and decided a better understanding of the current maintenance of the facility is needed for the DRAFT BPMC Minutes 12/1/17 Page 5 of 6 analysis.HEA is working to provide the information for discussion at the next O&D meeting.Mr. Warner will continue to provide updates. Finance Subcommittee Mr.Carey reported the RFP for the insurance review for Bradley and Intertie resulted in one proposal for approximately $12,000.The proposal was forwarded to Mr.Woolf to confirm the desire to award. 9.OPERATOR REPORT Mr.Day provided the Operator's Report to members.He reported Bradley operated at basically 100%availability this month and Unit Two was electively taken out of service for six hours.Mr. Day noted the LED lightsin the power house are performing effectively and providing savings dueprimarilytotheoccupancysensor.os Mr.Quiachon expressed appreciation to Mr.Day for hosting him during his recent visit to Bradley. He commented on theimpressive state,condition and operation of the plant.He believes thereisahighprobabilityofmeetingthe50-year license extension.: 10.COMMITTEE ASSIGNMENTS .;None.Se 11.MEMBERS COMMENTS Mr.Carey informed the new Executive Director will begin in January as the BPMC representative.He expressed appreciation for all the work on thefiinancing.Mr.Thibert expressed appreciation to AEA and Finance Committee for their diligent work.Mr.Borgeson and Chair Janorschke echoed the©appreciation for the work on financing,and for thecleanaudit.'9.NEXT MEETING DATE --Wednesday,DDecember 6,201710.ADJOURNMENT There being nofurther business for the committee,the meeting adjourned at 12:33 p.m. BY:Bradley Janorschke,Chair Attest: Bryan Carey Alaska Energy Authority,Secretary DRAFT BPMC Minutes 12/1/17 Page 6 of 6 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING REGULAR MEETING Alaska Energy Authority,Anchorage,Alaska December 6,2017 1.CALL TO ORDER Chair Janorschke called the regular meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 10:03 a.m.ks 2.ROLL CALL FOR COMMITTEE MEMBERS Cory Borgeson (Golden Valley Electric Association [GVE \));B jan|Carey (Alaska EnergyAuthority[AEA]);Lee Thibert (Chugach ElectricA sociation cea gemny IZZo (MatanuskaElectricAssociation[MEA]);Mark Johnston (pho Ir [ML&P]);John Foutz (City of Seward);and Brac[HEA)).' 3.PUBLIC ROLL CALL oo,Brenda Applegate,Teri Webster,(AEA):Brian.Hickey,She ti:Higher,Mark Johnson,JoshResnick,Burke Wick (CEA);Brian Bjorkquist (Department of Law);Bob Day,Alan Owens,EmilyHutchingson(phone),Larry Jorgensen (HEA);cvpa cernense ema roller MIEAY.Dov eR )EMongaKirkGibsonwe The amended agenda was.inanimously approved. 6.NEW BUSINESS Discussion of the Timing of the BPMC Allocation of Shares of Battle Creek MOTION:ML&P hereby moves that:1)The pre-allocation of 100%of the BCD Shares shall be made by the BPMC as of December 6,2017,in accordance with Resolution 2017- 02,as it has been amended;2)Final re-allocation of 100%of the BCD Shares by the BPMC shall be made on or before Noon,December 13,2017;and 3)In the interim period (between the pre-allocation and the final re-allocation of the BCD Shares),Participating BPMC Minutes 12/6/17 Page 1 of 6 Purchasers shall have the opportunity to express their interests in acquiring the right to BCD Shares held by Non-Participating Purchasers.Mr.Borgeson seconded the motion. Mr.Izzo requested the process of allocating shares include all BPMC members,and be clear and transparent. Mr.Borgeson informed Attachment 1 to the resolution includes the date of December 6,2017, for the allocation of shares.He requested additional information from Mr.Gibson regarding the impact of changing the date in this motion. This motion would provide otal oesecurity for ML&P.Mr.Johnston indicated the motionneedstoberesolvedforML&> Mr.Bjorkquist advised Resolution 2017-02 and Attachment 1,E4.,contains the provision describing how the participating purchasers will hold harmless the non-participating purchasers, including how the participating purchasers are going to pay all the costs.He believes this addresses the concern of protecting the non-participating utilities from project costs. to be inclined to support the bond financing resolution. Mr.Izzo stated he is not comfortable with the current motion and ML&P's willingness to kill the project over calculations of what he believes could be approximately $92,000 a year.He finds the motion very troublesome. BPMC Minutes 12/6/17 Page 2 of 6 Ms.Applegate understands AEA needs the BPMC to pass the financing resolution and to attain 100%project participation allocated by one or more utilities.AEA must have the allocation percentages to calculate the capital reserve requirements for the utilities in sufficient time to provide to the trustee before closing on December 27". Mr.Foutz expressed discomfort with the current motion and wants the project to go forward.He believes the discussions and decisions regarding the relationship between participants and non- participants have already occurred.Mr.Foutz feels this motion could create a bidding war with other utilities over interest in non-participant shares. 5 brought before the CommitteeMr.Thibert does not believe theexpresseddispleasurewiththismotionbecausetheissue and solved through the passage of a resolution a month ago A roll call was taken,and the motion passed abstaining as Chair. Battle Creek Diversion Project A.Review of Battle Cre e 24 Amendment to Res '2017-( e Amendment to Attachm MOTION:Mr.Borgeso ;motion to approve the 2"?Amendment to Resolution2017-02 and approve the 1%'Amendment to Attachment 1.Mr.Carey seconded the motion. Mr.Izzo requested clarification on which part of the amendment is a revisitation of what the Committee voted on last Friday.Mr.Gibson answered the motion provides the ability for non- participating purchasers to sell or transfer their rights to shares to a participating purchaser. The process to activate the shares requires giving notice and reimbursing the initial funding to the participating purchasers. Mr.Borgeson commented ML&P has been clear from the beginning of their non-participation. He hopes ML&P will vote in the affirmative for the financing. BPMC Minutes 12/6/17 Page 3 of 6 MOTION:Mr.Izzo made a motion to amend the 1**Amendment to Attachment 1,Section C3.,the second sentence to read,"The results of the study undertaken pursuant to this Paragraph C.3.will be approved in accordance with the voting requirements for Optional Project Work.”Mr.Thibert seconded the motion. Mr.Izzo expressed the concern the affirmative vote of 80%would give non-participating parties the ability to control the acceptance of the study.He is in favor of replacing the percentage to 51%. Mr.Thibert urged ML&P to vote in favor of the motion to amend: Mr.Warner asked if the original 80%numberis a BPMC réquirement.Mr.Gibson informed the80%is not a requirement.Mr.Warner believes the chat jet )51%places the non-participantsatthemercyoftheparticipants.: Mr.Borgeson expressed objection to the more Es Ms.Cartledge reviewed the change on page three and four to remove the words,"In the best interest of the Power Purchasers.”The change on page three is to read,"The capital reserve fund enhances the marketability of the bond.”The next change is to include the phrase,"2017- 02,as amended on December 6,2017.”The misspelling of Bradley will be corrected. Mr.Borgeson requested an update from Mr.Eoff regarding the tax bill in Congress and the CREBS subsidy.Mr.Eoff informed the risk of sequestration to the CREBS subsidy program is still present.There have been no new developments since the discussion last week.The information will not be clear until the legislation in Congress is passed. BPMC Minutes 12/6/17 Page 4 of 6 Mr.Borgeson expressed support for the changes to the resolution. Mr.Eoff reported an error in the 50-year calculation summary distributed to members,which resulted in an erroneous higher cost of power.The error will be corrected today. Ms.Cartledge gave an overview of the attachments to 2017-03 provided to members.The numbering of the attachments is for the purposes of AEA's supplemental resolutions. Mr.Borgeson encouraged AEA to continue efforts for provisions with CFC in the event of a reorganization or update to the purchasers of the project. Chair. B. None. C.Approval of Battle Creekok Financing, 8.MEMBERS COMMENTSae Mr.Thibert expressed appreciation to the Finance Committee and all involved for an outstanding job. Mr.|zzo echoed Mr.Thibert's comments and added appreciation to AEA staff. Mr.Foutz expressed appreciation for the efforts to move the project forward.He reiterated discomfort with what transpierd early in the meeting. Mr.Carey expressed gratitude for all the work and support received on the financing. BPMC Minutes 12/6/17 Page 5 of 6 Chair Janorschke echoed prior remarks of appreciation and included the diligence of the legal participants. 9.NEXT MEETING DATE The next meeting is a scheduled teleconference on December 13,2017. 10.ADJOURNMENT There being no further business for the committee,the meeting adjourned at 12:37 p.m. BY: Bradley Janorschke,Chair Attest: Bryan Carey Alaska Energy Authority,Secretary BPMC Minutes 12/6/17 Page 6 of 6 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING TELEPHONIC MEETING Alaska Energy Authority,Anchorage,Alaska December 13,2017 1.CALL TO ORDER BPMC Secretary Bryan Carey called this telephonic meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 12:10 p.m. 2,ROLL CALL FOR COMMITTEE MEMBERS -Bob Day (Homer Electric Association [HEA]);Bryan Carey (Alaska Energy Authority [AEA]); Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association[MEA]);John Foutz (City of Seward);and Jeff Warner (Anchorage Municipal Light &Power[ML&P]).ae .The Chair and Vice-Chair were not present.Mr."ey called for a motion to elect a chair totoday's meeting.Mr.Izzo made a motion for Mr.Thibert to be the Chair for the meeting.MotionwassecondedbyMr.Day.Vote was taken and it was unanimous approved. Chair Thibert took over the meeting and asked for a roll call of the public.3.PUBLIC ROLL CALL yBurkeWick,Brian Hickey,Josh Resnick,Sherri Highers and Mark Johnson (CEA);Bob Day, Emily Hutchinson and Larry Jorgensen (HEA);Kirk Gibson (McDowell Rackner Gibson,PC); Brian Bjorkquist (Attorney General's Office);Tony Zellers and Matt Reisterer (MEA);AmyAdler,Kirk Warren and Teri Webster,(AEA)..4,PUBLIC COMMENTS None 5.AGENDA APPROVAL ° MOTION:Mr.Day made a motion to approve the agenda.Motion seconded by Mr. Warner. Vice-Chair Cory Borgeson joined in the call at 12:16 p.m.He asked Mr.Thibert to continue being the chair for the rest of the meeting. 6.NEW BUSINESS 6A -Non Participating Utilities Selling Shares for Battle Creek BPMC Minutes 9/6/17 Page 1 of 2 GVEA and ML&P are not participating in the Battle Creek project.They had until today to sell their shares to another utility.Mr.Borgeson stated he did not receive any offers for GVEA shares.Mr.Warner stated ML&P received one offer to purchase the 25.9%capacity rights for the Battle Creek diversion project and ML&P has accepted the offer from HEA to purchase allofML&Ps shares. Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages. Chair Thibert requested AEA to send out the new Battle Creek«capacity percentages to the groupthisweek. 7.MEMBERS COMMENTS Mr.Izzo stated his disapproval of giving non-participating utilities an avenue to sell shares theydonothavesincetheyarenotparticipatingintheproject.Mr.Foutz agreed with Mr.Izzo's comments and stated he did not like how ML&PP changed therulesoncetheplanswerealreadyinPlace.OS . Mr.Borgeson apologized for not being present at the beginning of the meeting.He was delayedinapriormeeting.ca Ms All the committee members thanked Mr.Thibert for ling in as3s chair for the meeting today.Mr.Carey thanked Mr.Izzo for his participation attthe AEA board meeting on December 7°.Mr.Thibert thanked AEA for all the extra timethey have put in to get the financing complete fortheBattleCreekproject.,. 8."NEXT"MEETING DATE -January 19,20179.ADJOURNMENT _"eTherebeingnofuitherbusinessfor the committee,the meeting adjourned at 12:23 p.m. BY: Lee Thibert,Chair Attest: Bryan Carey Alaska Energy Authority,Secretary BPMC Minutes 9/6/17 Page 2 of 2 BPMC February 2,2018 Battle Creek Update Events: e Battle Creek financing closed December 26". e Interest was 4.24%prior to the tax subsidy.After subsidy the first two bonds will be approximately 1.3%. e Orion Marine Group received a Notice of Intent to Award December 28". e Orion has provided proof of bonds &insurance e AEA is working with the utilities on a FY18 budget that covers items that cannot be paid out of the financing. Schedule: e AEA will have a kick-off meeting with Orion Marine Group (West Fork Upper Battle Creek contractor)the afternoon of February 8.Utilities are invited to attend to meet Orion,discuss schedule,and project issues. e We Orion will want to mobilize &setup camp during Apmil. 1B Battle Creek Construction Budget Entry Page -AP &Other FY 2018 Budget Note:these are administrative costs and cannot be charged to the construction financing Dept |FERC i *AP Detail Description ie,Total Cost Ml AEA |332 -Reservoirs,dams,and waterways Bond Arbitrage Fee $2,000.00 AEA {332 -Reservoirs,dams,and waterways Trust &Account Fee $3,500.00 AEA {332 -Reservoirs,dams,and waterways Legal S$15,000.00 AEA |332 -Reservoirs,dams,and waterways Archive bid documents $500.00 AEA |332 -Reservoirs,dams,and waterways AEA Administrative Fee Ss 22,000.00 AEA AEA AEA AEA AEA AEA $43,000.00 BC-AEA AP Page 1 of 2 Battle Creek Construction Budget Entry Page -Indirect Labor FY 2018 Budget Estimated costs to determine the flat fee for AEA Administrative Support DameDActivityJobTitleSTRate*ST Hours Total Costept|FERC AEA |332 -Reservoirs,dams,and waterwAEA Admin Fee Sr.Accountant/Budget Analyst 79.33 60.00 |$4,759.65 AEA |332 -Reservoirs,dams,and waterwAEA Admin Fee AEA Compliance/Inventory &Grants 81.52 52.00 |$4,238.81 AEA {332 -Reservoirs,dams,and waterwAEA Admin Fee Accountant 62.69 35.00 |$2,194.04 AEA {332 -Reservoirs,dams,and waterwAEA Admin Fee Senior Contracting Officer 97.28 80.00 |$7,782.49 AEA {332 -Reservoirs,dams,and waterwAEA Admin Fee AEA Assistant Controller 90.38 20.00 |$1,807.66 AEA {332 -Reservoirs,dams,and waterwAEA Admin Fee AEA Controller 124.84 7.50 |$936.32 AEA S - AEA S - AEA $- Indirect Labor Estimate $21,718.96 Total AEA Administrative Fee (rounded)$22,000.00 *ST Rate includes a 4.2%increase for facility expenses (supplies,building,overhead) BC-AEA Admin Fee Calc Page 2 of 2 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT WEST FORK UPPER BATTLE CREEK 2018 DRAFT BUDGET AMENDMENT 2 Date :02/02/18 42 a. ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT 2018 Budget Contents Schedule Description Page# Overview of Budget Changes between FY18 Amended Budget 07/28/17 and FY 18 Draft Amended Budget 3 Schedule A Budget Summary 4 Schedule A-1 Capital Purchases not funded by R&C 5 Schedule B Operations &Maintenance Budget 6-12 Schedule C Monthly Utility Contributions 13 Schedule D R&C Fund Disbursements and Repayments 14 Schedule E Battle Creek Captial Purchases 15 Schedule F Battle Creek Administrative Costs 16 Schedule G Battle Creek Monthly Utility Contributions 17 Schedule H Battle Creek Capital Reserve Fund and Contribution True Up 18 ,1/25/20182:52 PMH:\Accounting\AEA FY 18 FS Shared Files\Bradley Lake\Budget\A -2018 BradleyBudgetAmendement-Draft-020218.xIsx 2 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Overview of Budget Changes between FY18 Amended Budget 07/28/17 and FY18 Draft Amended Budget FY18 Amended Budgeted 07/28/17 Utility Contributions -Battle Creek 0 From Schedule A REVENUES 1)Increase in Other Available Funds (499,985) (499,985) EXPENSES 2)Battle Creek Administrative Costs 43,000 3)Increase in Operating Reserve Fund Requirement 8,600 4)Increase in Debt Service-Battle Creek 895,825 5)Increase in Cost of Issuance 9th Series 21,217 968,642 Net change in utility contributions-Battle Creek 468,657 FY18 Draft Amended Budgeted Utility Contributions -Battle Creek 468,657 Notes: 1)Increase in Other Available Funds The Capital Reserve Fund was overfunded in December 2017.The overfunded portion of the Capital Reserve Fund will be transferred to the Revenue Fund and be deemed "other available funds"to be used to pay for the costs listed above 2),3),and 4)(See section 508.2 of the Power Revenue Bond Resolution). 2)Battle Creek Administrative Costs These costs represent costs associated with the administration of the Battle Creek project after the financing was closed. These costs include legal,accounting fees,recordkeeping,custody and similar costs. 3)Increase in Operating Reserve Fund Requirement Battle Creek Administrative Costs will be paid for out of the Battle Creek Operating Fund which has a Operating Reserve Fund requirement of 20% 4)Increase in Debt Service-Battle Creek Interest payments on loan A-9000 and A-9001 are due on July 1,2018.Those funds are required to be deposited in the Debt Service Fund 5 business days prior to payment date. Loan A-9000 =$868,909.59 |Loan A-90001 =$26,914.47 5)Increase in Cost of Issuance 9th Series The total cost of issuance for the new debt is $142,741.43.The portion that applies to the Series 9 loan (non CREBs and non QECB)is $21,216.55. Instead of drawing on the 3rd loan to pay the costs of issuance,the battle creek participating utilities will pay these costs directly through the Bradley Lake budget. 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xlsxOverview Page 3 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Budget Summary Schedule A changes made by Amend 2 highfighted FY2016 FY2017 FY2018 FY2018 FY2018 FY2018 INC(DEC)FRM ACTUALS Amended Original 07/28/17 Amended Amend 2 Draft Amended PY AMENDED REVENUES,EXPENSES &CHANGES IN SURPLUS Budget Budget Budget Change Budget BUDGET REVENUES UTILITY CONTRIBUTIONS (sch C)17,828,513 19,543,371 19,819,362 19,819,362 ty 19,819,362 0 UTILITY CONTRIBUTIONS-Battle Creek (sch G)0 800,000 0 400,000 ()400,000 Qo UTILITY CONTRIBUTIONS-Battle Creek (sch G)0 0 0 0 468,657 468,657 468,657 CAPITAL RESERVE CONTRIBUTION Battle Creek (sch H)0 0 0 0 2,796,378 2,796,378 2,796,378 OTHER AVAILABLE FUNDS Battle Creek 0 Ct]0 0 499,985 499,985 499,985 INTEREST INCOME 1,930,547 1,755,000 1,845,000 1,845,000 0 1,845,000 () 19,759,060 22,098,371 21,664,362 22,064,362 3,765,020 25,829,382 3,765,020 EXPENSES OPERATIONS (sch B)4,273,634 §,154,110 4,593,387 4,593,387 0 4,593,387 0 Battle Creek Administrative costs (sch F))0 0 ty 43,000 43,000 43,000 RENEWALS/REPLACEMENTS (R&C FUND REPAYMENTS)(sch D)2,692,710 3,262,783 2,793,307 2,793,307 0 2,793,307 0 NON R&C FUND CAPITAL PURCHASES (sch A-1)26,444 250,000 1,307,000 1,307,000 0 1,307,000 0 CAPITAL PURCHASES-Battle Creek (sch E)0 800,000 0 400,000 0 400,000 0 TRANSFER TO (FROM)OPERATING RESERVE (9.747)(85,531)(112,145)(112,145)0 (112,145)0 TRANSFER TO (FROM)OPERATING RESERVE-Battle Creek )0 0 0 8,600 8,600 8,600 DEBT SERVICE (net of Capital Reserve Reductions)12,494,600 12,426,200 12,778,100 12,778,100 0 12,778,100 0 DEBT SERMCE Battle Creek 0 0 0 0 895,825 895,825 895,825 IRS Subsidy 0 0 0 0 0 0 iy Cost of Issuance 9th Series 0 0 ty]0 21,217 21,217 21,217 CAPITAL RESERVE CONTRIBUTION Battle Creek (sch H)0 0 0 (]2,796,378 2,796,378 2,796,378 ARBITRAGE TRANSFER 281,419 290,809 304,713 304,713 0 304,713 0 ARBITRAGE TRANSFER-Battle Creek (']0 ['][})0 0 LJ 19,759,060 22,098,371 21,664,362 |22,064,362 |3,765,020 |25,829,382 |3,765,020 CURRENT YEAR SURPLUS (DEFICIT)0 0 0 0 0 0 BALANCE SHEET ASSETS REVENUE FUND 385,309 0 0 0 )0 OPERATING FUND 1,403,738 0 0 0 0 0 RECEIVABLE FROM R&C 1,055,961 0 0 0 0 0 PREPAID EXPENSES 85,194 0 0 0 0 0 2,930,202 0 Cy 0 o 0 LIABILITIES &SURPLUS LIABILITIES 809,828 ct]0 0 QO 0 PAYABLE TO UTILITIES O&M 1,064,413 0 0 )0 0 PAYABLE TO UTILITIES R&C 1,055,961 0 0 0 0 0 2,930,202 0 0 0 0 0 OTHER INFORMATION OPERATING RESERVE *1,116,353 1,030,822 918,677 918,677 (1)918,677 OPERATING RESERVE Battle Creek*1,116,353 0 0 )8,600 8,600 MONTHLY CONTRIBUTIONS (FY 18-acceh d over 6 hs)1,654,119 1,628,614 3,303,227 3,303,227 (]3,303,227 MONTHLY CONTRIBUTIONS Battle Creek 0 0 0 ()117,164 117,164 *Required to be 20%of budgeted operating expense 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch A Page 4 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Capital Purchases Not Funded by R&C Fund Schedule A-1 FY15 FY16 FY17 FY18 APPROVED Capital Project Description ACTUALS ACTUALS ACTUALS BUDGET {Comments Replace Fish Water Valve Actuators -26,444 -- DCS Security Interface for Data Access 141,703 -.- Lube Oil Purification System 47,723 .-- Replace 1998 Chevrolet Crew Cab Vehicle 32,306 --- Replace 1990 Ford Single Cab Vehicle 32,306 --- Start in FY 2017 most of billing will be in F¥2018 ($250,000 total -$25,000 FY17 andReplace/Automate Fish Water Valves &Actuators 89 225,000 $225,000 FY18) F Currently the heavy equipment is stored outside in the weather.The D Hittle report notedEquipmentstorageshed(unheated bus barn)..100,000 the deleterious effects of weather on the boom truck as well as the other equipment. Heavier truck for snow removal and general hauling to the dam as existing pick up trucks 5 are often too small for the loads.This replaces the curranty 1999 plow truck.ft should be1tonFlatbedwithPlow.65,000 noted that the Boom truck is near end of life and this truck will replace the hauling function of the boom truck. ... ..'These two bridges are decaying and if not repaired they wili fail.Failure would be a veryBattleCreekBridgeRepairRefurbishment(2)182,000 fexpensive proposition as the bridges would need to be completely removed. Used to erect equipment building and assist in general construction like the bridge removal. Mobil Crane 40 to 50 tons (used)---100,000 [This Crane is required for general Plant support as the Boom Truck is nearing end of life (See D Hittle report). Slated for replacement in 2020 in D Hittle report.Updated amount based on NC Machinery web site.This is a critical piece of plant equipment used extensively for snow removal and spe material handling the current loader is nearly 30 years old.It is difficult to get parts andReplaceMichiganLoader.350,000 materials for this equipment as Michigan is now owned by Volvo.We are seeing metal in the transmission oil and this indicates potential failure.We are currently changing oil often to extend the life of the loader. ,The Crews Quarters kitchen is in sore need of repair and refurbish.The current kitchen isUpgradeCrewsQuartersKitchen***90,000 Fo years old and is not adequate to meet any health standards. The existing ambulance is 29 years old.Though called an ambulance it is a vehicle .dedicated for transport of an injured individual with first aid supplies on board,backboard,Replace 1988 Suburban Ambulance 65,000 stokes litter,splints,bandages,AED,oxygen and other first responder supplies.[t is not possible to transport a person on a stretcher in a pickup truck in winter. 1/2 ton Pick up truck -.-35,000 Additional use truck for BLPP personnel The kitchens and bathrooms in the residences date from 1991 and are in poor to fair Upgrade Residence kitchens ---75,000 Icondition.They have seen 30 years of continuous use.This is to update aff four kitchens in the residences. Replace existing HID lighting with modern energy efficient light fixtures.Based on an .seb j lenergy cost at Bradley of $.09 per KWh these fixtures will have a positive payback in 2ReplaceHighBayLightinginPowerPlant20,000 years.These fixtures will also reduce maintenance costs due to lack of the need to replace [bulbs Total Non R&C Capital Purchases 254,039 26,444 89 1,307,000 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch A-1 Page 5 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Operations &Maintenance Budget Summary Budget by Participant Schedule B HEA 3,052,652 HEA 3,365,387 HEA 3,209,154 HEA 2,704,303 CEA 553,000 CEA 408,098 CEA 190,187 CEA 183,499 AEA 1,814,850 AEA 1,808,280 AEA 1,754,770 AEA 1,705,585 Fv15 FY16 FY17 Fv18 FY15 Fyi6 FY17 FY18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY Summary by cost type Labor &Benefits 1,986,848 1,713,440 273,408 2,143,223 1,738,336 404,887 2,005,079 744,386 1,260,693 1,889,814 (115,265) Travel 35,410 15,528 19,882 98,600 13,796 84,804 132,950 10,255 122,695 76,950 (56,000) Training 38,731 26,569 12,162 38,731 10,819 27,912 49,300 1,619 47,681 49,300 - Contractual 871,280 618,735 252,545 1,205,659 813,606 392,053 1,217,418 375,639 841,779 841,062 (376,356) Suppties &Materials 435,919 224,296 211,623 275,760 95,952 179,808 229,358 29,114 200,244 183,345 (46,013) Other Costs §93,797 225,712 368,085 451,846 375,357 76,489 381,744 114,062 270,682 387,818 6,074 Equipment &Machinery 30,130 23,711 6,419 33,130 6,051 27,079 11,500 850 10,650 7,000 (4,500) Maintenance Projects 60,000 27,414 32,586 13,000 3,457 9,543 ----- Administrative Costs 1,368,387 1,102,344 266,043 1,321,817 1,216,260 105,557 1,126,761 §11,053 615,708 1,158,098 31,337 5,420,502 3,977,749 1,442,753 5,581,766 4,273,634 1,308,131 5,154,110 1,783,977 3,370,134 4,593,387 (560,723) FERC 535 -Operation Supervision &Engineering Operations Sup/Eng Bradley Lake Operating Labor &Benefits 291,632 282,780 8,852 304,235 321,664 (17,429)299,649 130,170 169,479 265,587 (34,062) Travel 8,610 12,894 (4,284)9,500 9,281 219 10,450 8,496 1,954 10,450 - Training 7,904 4,116 3,788 7,904 2,080 §,824 9,300 -9,300 9,300 - Contractual 1,445 -1,445 1,445 -1,445 1,400 -1,400 1,000 (400) Supplies &Materials 6,203 344 5,859 6,203 346 5,857 4,100 -4,100 4,000 (100) Bradley Lake Operating Total 315,794 300,134 15,660 329,287 333,371 (4,084)324,899 138,666 186,233 290,337 (34,562) FERC 535 -Operation Supervision &Engineering Total 315,794 300,134 15,660 329,287 333,371 (4,084)324,899 138,666 186,233 290,337 JHEA (34,562) FERC $37 -Hydraulic Expenses Hydraulic Expenses Bradley Lake Operating Labor &Benefits 95,056 76,200 18,856 95,273 81,677 13,596 92,746 33,446 59,300 94,453 1,707 Contractual 19,504 8,000 11,504 17,180 -17,180 4,000 §,647 (1,647)2,000 (2,000) Supplies &Materials 2,608 :2,608 2,608 1,277 1,331 2,900 179 2,721 2,000 (900) Bradley Lake Operating Total 117,168 84,200 32,968 115,061 82,954 32,107 99,646 39,272 60,374 98,453 (1,193) FERC $37 -Hydraulic Expenses Total 117,168 84,200 32,968 115,061 82,954 32,107 99,646 39,272 60,374 98,453 [HEA {1,193) 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xisxSch B Page6of18 FY15 FY16 FY17 Fv18 FY15 FY16 FY17 Fy18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over}Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY FERC 538 -Electric Expenses Electric Expenses Bradley Lake Operating Labor &Benefits 224,000 234,351 (10,351)257,107 215,440 41,667 242,940 98,375 144,564 232,294 (10,646) Travel ::-:--7,000 1,759 §,241 7,000 : Training 30,827 18,383 12,444 30,827 8,739 22,088 25,000 1,619 23,381 25,000 - Contractual 21,342 14,055 7,287 3,342 1,400 1,942 2,000 1,400 600 2,000 . Supplies &Materials 6,232 2,184 4,048 12,232 6,241 5,991 8,500 4,214 4,286 9,732 1,232 Bradley Lake Operating Total 282,401 268,973 13,428 303,508 231,820 71,688 285,440 107,367 178,072 276,026 (9,414) FERC 538 -Electric Expenses Total 282,401 268,973 13,428 303,508 231,820 71,688 285,440 107,367 178,072 276,026 THEA (9,414) |FERC 539 -Misc.Hydraulic Power Generation Expenses Misc Hydro Power Exp Bradley Lake Operating Labor &Benefits 192,000 114,373 77,627 189,473 158,532 30,941 178,991 73,876 105,116 179,530 539 Training -4,070 (4,070)---18,000 -15,000 15,000 - Contractual 239,571 142,752 96,819 315,249 285,812 29,437 297,048 95,836 201,212 287,525 (9,523) Supplies &Materials 94,878 18,473 76,405 22,000 19,041 2,959 17,900 7,258 10,642 17,900 - Bradley Lake Operating Totat 526,449 279,668 246,781 526,722 463,385 63,337 508,939 176,970 331,969 499,955 [HEA (8,984) BRADLEY CIRCUITS/RADIO TO BERNICE LK Other Costs 30,000 28,740 1,260 30,000 31,059 (1,059)35,695 17,848 17,847 35,695 - BRADLEY CIRCUITS/RADIO TO BERNICE LK Total 30,000 28,740 1,260 30,000 31,059 (1,059)35,695 17,848 17,847 35,695 FHEA - BRADLEY CIRCUITS BERNICE LK TO ANCH Other Costs 30,000 31,485 (1,485)28,746 29,864 (1,118)29,773 14,770 15,003 29,773 - BRADLEY CIRCUITS BERNICE LK TO ANCH Total 30,000 31,485 (1,485)28,746 29,864 (4,118)29,773 14,770 18,003 29,773 [CEA - FERC 539 -Misc.Hydraulic Power Generation Expenses Total 586,449 339,893 246,556 585,468 524,308 61,160 574,407 209,588 364,820 565,423 (8,984) FERC 540 -Rents FERC Land Use Fee Bradley Lake Operating Other Costs 180,000 137,230 42,770 183,000 279,876 (96,876)312,176 78,044 234,132 318,000 5,824 Bradley Lake Operating Total 180,000 137,230 42,770 183,000 279,876 (96,876)312,176 78,044 234,132 318,000 §,824 FERC 540 -Rents Total 180,000 137,230 42,770 183,000 279,876 (96,876)312,176 78,044 234,132 318,000 JAEA 5,824 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xisxSch B Page7of18 FY15 FY16 FY17 Fyi8 FY15 FY16 FY17 FY18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY FERC 541 -Maintenance Supervision &Engineering Maint Supervision/Eng Bradley Lake Operating Labor &Benefits 214,230 197,018 17,212 222,118 239,299 (17,181)224,284 94,624 129,660 272,586 48,302 Bradley Lake Operating Total 214,230 197,018 17,212 222,118 239,299 (17,181)224,284 94,624 129,660 272,586 48,302 FERC S41 -Maintenance Supervision &Engineering Total 214,230 197,018 17,212 222,118 239,299 (17,181)224,284 94,624 129,660 272,586 JHEA 48,302 FERC 542 -Maintenance of Structures Maintenance of Structures Bradley Lake Operating Labor &Benefits 96,200 75,264 20,936 95,273 89,890 5,383 92,746 33,368 59,378 94,453 1,707 Contractual ------10,000 -10,000 10,000 - Supplies &Materials 64,273 10,009 54,264 61,273 23,398 37,875 §3,713 398 53,315 53,713 - Equipment &Machinery 8,500 10,769 (2,269)11,500 6,051 §,449 114,500 850 10,650 7,000 (4,500) Maintenance Projects 6,000 :6,000 4,000 1,827 2,173 :-:ba : Bradley Lake Operating Total 174,973 96,042 78,931 172,046 121,166 50,880 167,959 34,616 133,343 165,166 (2,793) FERC $42 -Maintenance of Structures Total 174,973 96,042 78,931 172,046 121,166 50,880 167,959 34,616 133,343 165,166 JHEA (2,793) [FERC 543 -Maintenance of Reservoirs,Dams &Waterways Maint Res,Dams,WWays Bradley Lake Operating Labor &Benefits 49,950 42,309 7,641 51,276 42,848 8,428 50,409 49,440 969 50,610 201 Contractual 28,769 630 28,139 5,200 9,080 (3,880)§,200 63,704 (58,504)6,500 1,300 Bradley Lake Operating Total 78,719 42,939 35,780 56,476 51,928 4,548 55,609 113,144 (57,535)57,110 1,501 BRADLEY NUKA REPAIR Contractual ------15,000 409 14,591 15,000 - Supplies &Materials -787 (787)-:----:bd Equipment &Machinery 21,630 12,942 8,688 21,630 -21,630 ---"- BRADLEY NUKA REPAIR Total 21,630 13,729 7,901 21,630 -21,630 15,000 409 14,591 15,000 - BRADLEY POWER TUNNEL MAINT (Dam) Contractual 56,000 43,131 12,869 20,000 3,673 16,327 15,000 311 14,689 15,000 - BRADLEY POWER TUNNEL MAINT (Dam)Total 56,000 43,131 12,869 20,000 3,673 16,327 15,000 311 14.689 15,000 - BRADLEY POWER TUNNEL DRAIN CLN/INSP (P/House) Maintenance Projects 9,000 -9,000 9,000 1,557 ------ BRADLEY POWER TUNNEL DRAIN CLN/INSP (P/House)Total 9,000 -9,000 9,000 1,557 -----bd FERC 543 -Maintenance of Reservoirs,Dams &Waterways Total 165,349 99,799 65,550 107,106 57,158 49,948 85,609 113,864 (28,255)87,110 [HEA 1,501 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch B Page8of18 Fv1s FY16 FY17 Fy18 FY1S FY16 FY17 FY18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY FERC 544 -Maintenance of Electric Plant Maintenance of Elec Plant Bradley Lake Operating Labor &Benefits 379,600 323,757 55,843 381,093 336,417 44,676 370,983 134,127 236,856 379,102 8,119 Travel 2,800 158 2,642 3,500 3,270 230 4,500 -4,500 4,500 - Contractual 61,849 33,765 28,084 91,443 69,651 21,792 79,000 10,607 68,393 70,000 (9,000) Supplies &Materials 27,245 20,650 6,595 27,245 10,142 17,103 27,245 5,867 21,378 20,000 (7,245) Maintenance Projects 25,000 25,000 --------- Bradley Lake Operating Total 496,494 403,330 93,164 503,281 419,480 83,801 481,728 150,601 331,127 473,602 (8,126) FERC $44 -Maintenance of Electric Plant Total 496,494 403,330 93,164 503,281 419,480 83,801 481,728 150,601 331,127 473,602 JHEA (8,126) FERC 545 -Maintenance of Misc.Hydraulic Plant Maint of Misc Hydr Plant Bradley Lake Operating Labor &Benefits 95,680 78,186 17,494 95,273 94,653 620 92,746 33,825 58,924 94,453 1,707 Contractual 3,900 170 3,730 3,900 -3,900 3,900 -3,900 3,900 - Supplies &Materials 71,281 40,220 31,061 43,000 28,044 14,956 43,000 6,626 36,374 35,000 (8,000) Bradley Lake Operating Total 170,861 118,576 §2,285 142,173 122,697 19,476 139,646 40,451 99,195 133,353 (6,293) BRADLEY FISH WATER DSGN/MIDDLE FORK SHACK IMPR Contractual 30,900 -30,900 24,900 -24,900 20,000 -20,000 -(20,000) BRADLEY FISH WATER DSGN/MIDDLE FORK SHACK IMPR Total 30,900 -30,900 24,900 -24,900 20,000 -20,000 -(20,000) FERC 545 -Maintenance of Misc.Hydraulic Plant Total 201,761 118,576 83,185 167,073 122,697 44,376 159,646 40,451 119,195 133,353 JHEA (26,293) FERC 556 -System Control &Load Dispatching System Cnt!&Load Disp Sradley Lake Operating Labor &Benefits 48,000 19,514 28,486 49,000 10,478 38,522 49,502 17,812 31,689 20,618 (28,884) Contractual §,000 -§,000 8,500 31 8,469 60,500 2,364 58,136 53,000 (7,500) Supplies &Materials 6,199 2,297 3,902 6,199 4,090 2,109 6,000 1,850 4,150 6,000 - Bradley Lake Operating Total §9,199 21,811 37,388 63,699 14,599 49,100 116,002 22,026 93,976 79,618 HEA (36,384) BRADLEY POWERHOUSE PC'S Contractual 30,500 3,201 27,299 50,000 37,261 12,739 ---"- BRADLEY POWERHOUSE PC'S Total 30,500 3,201 27,299 50,000 37,261 12,739 --:-HEA - BRADLEY DISPATCH REGULATIONS Maintenance Projects 20,000 -20,000 -------- BRADLEY DISPATCH REGULATIONS Total 20,000 -20,000 -------HEA - 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch B Page9of18 FY15 FY16 FY17 FY18 FY15 FY16 FY17 FY18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY Snow Measurement Bradley Lake Operating Contractual 11,000 10,000 1,000 10,000 10,000 -10,000 5,000 5,000 10,000 JAEA - Bradley Lake Operating Total 11,000 10,000 1,000 10,000 10,000 -10,000 5,000 5,000 10,000 - Seismic Service Bradley Lake Operating Contractual 60,000 64,477 (4,477)62,000 60,370 1,630 60,370 35,255 25,115 62,000 [AEA 1,630 Bradley Lake Operating Total 60,000 64,477 (4,477)62,000 60,370 1,630 60,370 35,255 25,115 62,000 1,630 Streamguaging Serv Bradley Lake Operating Contractual 295,000 296,409 (1,409)296,000 301,338 (5,338)310,000 78,582 231,418 213,137 JAEA (96,863) Bradley Lake Operating Total 295,000 296,409 (1,409)296,000 301,338 {5,338)310,000 78,582 231,418 213,137 (96,863) Permits Bradley Lake Operating Other Costs 100 350 (250)100 350 (250)100 100 -350 JAEA 250 Bradley Lake Operating Total 100 350 (250)100 350 (250)100 100 -350 250 FERC 556 -System Control &Load Dispatching Total 475,799 396,248 79,551 481,799 423,918 57,881 496,472 140,963 355,509 365,105 (131,367) FERC 562 -Station Expenses Station Expenses CEA SVC/Substation Maintenance Contract Labor &Benefits 300,500 269,688 30,812 251,852 147,344 104,508 130,414 45,324 85,090 123,726 (6,688)Travel 24,000 2,476 21,524 26,000 (31)26,031 6,000 -6,000 6,000 : Contractuat 6,500 2,145 4,355 6,500 1,244 5,256 4,000 3,447 554 4,000 - Supplies &Materials 157,000 129,332 27,668 95,000 2,118 92,882 16,000 2,722 13,278 16,000 - Other Costs -1,085 (1,085)-9,208 {9,208)4,000 300 3,700 4,000 - Maintenance Projects -2,414 (2,414)-73 (73)----- CEA SVC/Sub ion Mai e Contract Total 488,000 407,140 80,860 379,352 159,956 219,396 160,414 §1,792 108,621 153,726 (6,688) FERC 562 -Station Expenses Total 488,000 407,140 80,860 379,352 159,956 219,396 160,414 $1,792 108,621 153,726 [CEA (6,688) 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch B Page 10 of 18 FYi5 FY16 FY17 Fy1is FY1S FY16 FY17 FY18 Increase Amended (Over}Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY FERC 571 -Maintenance of Overhead Lines Maint of OH Lines Bradley Lake Operating Labor &Benefits :--146,320 94 146,226 179,671 -179,671 82,402 (97,269) Travel :--54,600 1,276 §3,324 95,000 -95,000 49,000 (46,000) Contractual ---90,000 33,746 §6,254 50,000 -50,000 86,000 36,000 Supplies &Materials ----1,255 (4,255)50,000 -50,000 19,000 (31,000) Other Costs 353,697 26,822 326,875 -------- Bradley Lake Operating Total 353,697 26,822 326,875 290,920 36,371 254,549 374,671 -374,671 236,402 (138,269) BRADLEY JUNCTION SWITCH REMOVAL Travel °-----5,000 -§,000 -(5,000) Contractual ------70,000 73,076 (3,076)-(70,000) Other Costs -:-210,000 25,000 185,000 ----- BRADLEY JUNCTION SWITCH REMOVAL Total ---210,000 25,000 185,000 75,000 73,076 1,924 -(75,000) MARKER BALL REPLACEMENT Labor &Benefits --4,929 -4,929 --:-- Travel ---5,000 -5,000 5,000 -5,000 -(5,000) Contractual ---200,000 -200,000 200,000 -200,000 -(200,000) MARKER BALL REPLACEMENT Total ---209,929 -209,929 205,000 -205,000 -(205,000) FERC 571 -Maintenance of Overhead Lines Total 353,697 26,822 326,875 710,849 61,371 649,478 654,671 73,076 581,595 236,402 [HEA (418,269) FERC 920 &930 -Administrative Expense AEA Bradley Fixed Admin Fees Bradley Lake Operating Administrative Costs 200,000 200,000 -200,000 200,000 -200,000 100,000 100,000 200,000 JAEA : Bradley Lake Operating Total 200,000 200,000 -200,000 200,000 -200,000 100,000 100,000 200,000 - Operating Committee Exp-Audit Bradley Lake Operating Administrative Costs 116,250 15,500 100,750 116,250 101,530 14,720 16,494 16,500 (6)16,800 JAEA 306 Bradley Lake Operating Total 116,250 15,500 100,750 116,250 101,530 14,720 16,494 16,500 (6)16,800 306 Operating Committee Exp-Legal Bradley Lake Operating Administrative Costs 25,000 22,110 2,890 25,000 77,719 (52,719)25,000 16,524 8.476 25,000 [AEA : Bradley Lake Operating Total 25,000 22,110 2,890 25,000 77,719 (52,719)25,000 16,524 8.476 25,000 - 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch B Page11of18 FY15 FY16 FY17 FY18 FY1S FY16 FY17 FY18 Increase Amended (Over)Under Amended (Over)Under Amended Actual @ (Over)Under Approved (Decrease) Budget Actual Budget to date Budget Actual Budget to date Budget 12/31/16 |Budget to date Budget from PY Operat Committee Exp-Arbitrage Bradley Lake Operating Administrative Costs 5,200 3,630 1,870 3,630 7,010 (3,380)3,630 :3,630 3,380 JAEA (250) Bradley Lake Operating Total 5,200 3,630 1,570 3,630 7,010 (3,380)3,630 -3,630 3,380 (250) Trust &Account Fees Bradley Lake Operating Administrative Costs 12,300 11,918 382 12,300 11,918 382 12,000 5,959 6,041 11,918 JAEA (82) Bradley Lake Operating Total 12,300 11,918 382 12,300 11,918 382 12.000 5,959 6,041 11,918 (82) Misc Admin Bradley Lake Operating Administrative Costs ----8,375 (8,375)---10,000 JAEA 10,000 Bradley Lake Operating Total ----8,375 (8,375)---10,000 10,000 FERC 920 &930 -Administrative Expense Total 358,750 253,158 105,592 357,180 406,552 (49,372)257,124 138,983 118,141 267,098 9,974 FERC 924 &925 -insurance Premiums Insurance Premiums Bradley Lake Operating Administrative Costs 510,000 510,799 (799)510,000 477,981 32,019 500,000 250,747 249,253 525,000 JAEA 25,000 Administrative Costs 64,637 §2,121 12,516 64,637 52,541 12,096 64,637 26,104 38,533 56,000 JHEA (8,637) Bradley Lake Operating Total 574,637 562,920 11,717 574,637 §30,522 44,115 564,637 276,852 287,785 581,000 16,363 Risk Management Bradley Lake Operating Administrative Costs 35,000 30,000 5,000 :------[CEA - Bradley Lake Operating Total 35,000 30,000 5,000 -::--::: [FERC 924 &925 -Insurance Premiums Total 609,637 592,920 16,717 574,637 530,522 44,115 564,637 276,852 287,785 581,000 16,363 FERC 928 -Regulatory Commission Expenses FERC Admin Fees Administrative Costs 250,000 150,519 99,481 210,000 182,885 27,115 180,000 -180,000 185,000 [AEA §,000 Bradley Lake Operating Total 250,000 150,519 99,481 210,000 182,885 27,115 180,000 -180,000 185,000 5.000 FERC Related Prof Services FERC Part 12 Inspection Administrative Costs ---55,000 35,663 19,337 25,000 1,362 23,638 - JAEA (25,000) Contractual Engineer-FERC license issues Administrative Costs 150,000 105,747 44,253 125,000 60,638 64,362 100,000 93,856 6,144 125,000 JAEA 25,000 Bradley Lake Operating Total 150,000 105,747 44,253 180,000 96,301 83,699 125,000 95,218 29,782 425.000 : FERC 928 -Regulatory C:ission Exp Total 400,000 256,266 143,734 390,000 279,186 110,814 305,000 95,218 209,782 310,000 5,000 Total Bradley Lake Budget 5,420,502 3,977,749 1,442,753 5,581,766 4,273,634 1,308,131 5,154,110 1,783,977 3,370,134 4,593,387 (560,723) 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xIsxSch B Page12of18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Monthly Utility Contributions Schedule C FY2015 FY2016 FY2017 FY2018 FY2017 to PERCENT Amended Amended Amended Original FY2018 POWER PURCHASER SHARE BUDGET BUDGET BUDGET BUDGET Change CHUGACH ELECTRIC 30.4%5,500,800 6,034,236 5,941,176 6,025,086 83,910 MUNICIPALITY OF ANCHORAGE 25.9%4,686,540 5,141,004 5,061,732 5,133,210 71,478 HOMER ELECTRIC 12.0%2,171,364 2,381,928 2,345,208 2,378,328 33,120 MATANUSKA ELECTRIC 13.8%2,497,068 2,739,216 2,696,988 2,735,076 38,088 GOLDEN VALLEY ELECTRIC 16.9%3,058,008 3,354,552 3,302,832 3,349,470 46,638 CITY OF SEWARD 1.0%180,948 198,492 195,432 198,192 2,760 Rounding (5)3 (3) 100.0%18,094,728 19,849,423 19,543,371 19,819,362 275,991 FY2018 PERCENT FY2015 FY2016 FY2017 July 1 through FY2018 POWER PURCHASER SHARE MONTHLY MONTHLY MONTHLY December 1 ONLY Change CHUGACH ELECTRIC 30.4%458,400 502,853 495,098 1,004,181 509,083 MUNICIPALITY OF ANCHORAGE 25.9%390,545 428,417 421,811 855,535 433,724 HOMER ELECTRIC 12.0%180,947 198,494 195,434 396,388 200,954 MATANUSKA ELECTRIC 13.8%208,089 228,268 224,749 455,846 231,097 GOLDEN VALLEY ELECTRIC 16.9%254,834 279,546 275,236 558,245 283,009 CITY OF SEWARD 1.0%15,079 16,541 16,286 33,032 16,746 100.0%1,507,894 1,654,119 1,628,614 3,303,227 1,674,613 **In FY18 contributions will be paid evenly over the first six months,beginning July 1,2017 and ending December 1,2017. No payments will be due from January 1,2018 through June 30,2018. (These accelerated payments are due to the cash flow needs of the R&C fund to pay for the SVC replacement project with total estimated cost of $8.7 million) 1/25/20182:52 PMA -2018 BradleyBudgetamendement-Draft-020218.xIsxSch C Page 13 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT R&C Fund Disbursements and Repayments 'Schedule D Actual Actual Actual Actual PROJECTED PROJECTED PROJECTED PROJECTEDaActed@ YO REPAY TO REPAY Vsti”TO REPAY TOREPAY Description Disburse at OG/30/18 Disburse at O6eie Disburse 0 O6OITT Disburse at 06/30/18 IR&C FUND PROJECTS 627,738.80 4,052,070.14 0.00 4,052,070.14 0.00 4,052,070.14 0.00 4,052.070.14 Replace RFLS 0.00 251,092.69 0.00 251,092.69 0.00 251,092.69 0.00 251,092.69 Replace Runners 0.00 1,946,732.79 0.00 1,946,732.79 0.00 1,946,732.79 0.00 1,946,732.79 Replace cable from dam to power house 0.00 2,321,922.94 0.00 2,321,922.94 0.00 2,321,922.94 0.00 2,321,922.94 Replace power system stabizer 9.00 619,205.10 0.00 619,205.10 0.00 619,205.10 0.00 619,205.10 Replace two RTUs 0.00 86,905.27 0.00 86,905.27 0.00 86,905.27 0.00 86,905.27 Culvert Repairs 0,00 875,966.79 0.00 675,966.79 0.00 675,966.79 0.00 875,966.79 Trans Towers Frost Jacking Repairs 0.00 887,596.62 0.00 $87,596.62 0.00 887,596.62 0.00 887,586.62 Replace Plant end SCADA Controle 0.00 1,344,683,05 0.00 1,344,683.05 0.00 1,344,683.05 0.00 1,344,683.05 Vibration Monitoring System 0.00 490.00 0.00 490.00 0.00 490.00 0.00 490.00 Battle Creek Feasibility 0.00 9.00 0.00 0.00 0.00 0.00 9.00 0.00 Fire Alarm System Replacement 0.00 0.00 0.00 0.00 0.00 0.00 350,000.00 350,000.00 Battle Creek Oversion 43,605.35 994,333.83 149,683.91 1,144,017.74 2,000.00 1,146,017.74 0.00 1,146,017.74 Replace Electro-Mechanical Relays 0.00 1,277.197.06 0.00 1,277 ,197.06 0.00 1,277,197.06 0.00 1,277 ,197.06[Fetrwater Screen Debris Removat 21,929.48 21,929.45.(290,306.98 312,236.43 0.00 312,236.43 0.00 312,236.43 jTurbine Nozze Repeir 96,423.49 96,423.49 |1,320,234.57 1,416,658.06 6,201.06 1,422,858.12 0.00 1,422,859.12ISVCreplacementDavesCreek|Soldotna 9.00 0.00]1,570,577.34 1,570,577.34 |5,773,822.66 7,344,400.00 f 1,360,400.00 8,704,800.00 'Spllway Raise 0.00 0.00 0.00 0.00 6.00 0.00 350.000,00 350,000.00 789 697.09 14,576.549.22 |3,330,802.80 17,907,352.02 9 §,782,023.72 _23.689.375.74]}2,060.400.00 25,749.74 Current Year R&C Repayment (1,146,123,00}(3,461;6)(3.262,788.00))(2,793,306,.63) [Adjust bel to $5 mill (won't be corrected until year end}0.00 0.00 0.00 0.00 Less Interest in Fund Applied to Repayment (244,582.41)(287,080.93 361,777 62)E06NetTransfertromRevenueFund(1,390,705.41)(3,748 672.09}}(3,824 565.62){2,936,306.63 [Cumulative Prior Years R&C Repayments (11,346,045,42)(12,716 539.31 (15,409,249.92)(17,920,812.74.JQue beck to Utities 20,211.51 1,055,961.48 1,113,202.79 143,000.00 R&C Cumulative interest (Retained)Applied As Part of Repayme 0.00 0.00 0.00 0.00 INet R&C Repayments (14,325.833.91)}11,660,577.83 14 296,047.12 (17,777 .612.74)}INET DUE TO R&C FUND 1,860.009.90 .§.768,763.00 §,035.856,37 R&C FUND CASH FLOW PROJECTION Beginning Investment Balance 3,015,716.76 5.623,509.49 1,931,991.64Ombursements-current year (766,797.23)(4,194,471,88){2,080,400.00) \Csbursements-prior year accrued (177,278.20;(2,065,650.48)}(1,587,551.84 R&C Repayment to utilities (179,788.03;(1,055,961.14 (1,113,202.79)INet other cash inflow outfiow)0.00 Current year interest earnings.361,777.62 Current year Partcipants Contributions to R&C 3.262,788.00EndingInvestmentBalance1,931,991.64 Accrued R&C Payable at year end-Due to Utities (4,113,202.79)](143,000.00)Accrued due from Revenue fund (debt service tranefer) R&C payable back to Revenue fund Accrued R&C vendor Payable at year end (2,065,650.48)(1,587,551.84 9,00 PROJECTED NET DUE +ENDING INVESTMENT BALANCE 5.000,000.00 5,000,000.00 5,000.000.00 [REPAYMENT AMOUNT [$756,665.11 X 25%all 4 years total repaid temaining to '$1,455,830.05 X 25%all 4 years th yr 363,957.51 at 6/30/18 pay at 7/118 FrY19 FY20 Fy21S$1,401,948.53 X 25%all 4 years 3rd yr 350,487.13 [ath yr 350,487.13 1,401,948.53 : 1$1,834,499.92 X 25%yr 1 |25%yr 2 |50%yr 32nd yr 458,624.98 [final yr 917,249.96 1,834,499.92 . $789,697.09 X 25%yr 1(75%yr 2 Tet yr 197,424.27 [final yr 592,272.82 789,697.09 - $$3,330,802.80 X 25%yr 1]32%yr 2 {25%yr 34 18%yr &st yr 832,700.70 [2nd yr 1,065,856.90 [3rd yr 832,700.70 2,731,258.30 (599,544.50)599,544.50 $5,782.023.72 x 25%afl 4 years 'Ist yr 1,445,505.93 [2nd yr 1,445,505.93 2.891,011.86 (2.891,091.86) 1,445,505.93 1,445.505.93 152,060,400 x 25%all 4 years ist yr 515,100.00 515,100.00 (1.545,300.00)515,100.00 515,100.00 515,100.00 1.370.493.90 2.592.710.54 2.511,352.83 2.793 306.63 (5.035 856.36)2,.560.150.43 _1,960,505.93 $15,100.00 *FY 17 projects reflect budgeted and actual numbers for different projects depending on which is higher (budgeted or actual),90 the R&C repayment amount reflects conservative amount 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xtsx Sch O Page 14 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Battle Creek Capital Construction Purchases Schedule E FY17 FY18 FY18 Original Amended Capital Construction Project Description Actuals Budget Budget 7/28/17 [Comments Battle Creek Diversion 798,072 -400,000 Total Construction 798,072 -400,000 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xlsxSch E Page 15 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Battle Creek Administrative Costs Budget Schedule F HEA - CEA - AEA 43,000 changes made by Amend 2 highlighted FY18 Draft Amended Budget Summary by cost type Administrative Costs 43,000 43,000 FERC 920 &930 -Administrative Expense Administrative Costs 22,000 [AEA AEA Battle Creek Fixed Admin Fees 22,000 Administrative Costs 500 JAEA Operating Committee Exp-Other 500 Administrative Costs 15,000 [AEA Operating Committee Exp-Legal 15,000 Administrative Costs 2,000 JAEA Operat Committee Exp-Arbitrage 2,000 Administrative Costs 3,500 JAEA Trust &Account Fees 3,500 FERC 920 &930 -Administrative Expense Total 43,000 Total Bradley Lake Budget 43,000 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xlsxSch F Page 16 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT changes made by Amend 2 highlighted Battle Creek Monthly Participating Purchaser Contributions Schedule G POWER PURCHASER Chugach Electric Association Municipal Light &Power Homer Electric Association Matanuska Electric Association Golden Valley Electric Association City of Seward Rounding POWER PURCHASER Chugach Electric Association Municipal Light &Power Homer Electric Association Matanuska Electric Association Golden Valley Electric Association City of Seward (See schedule H)FY2018 Original Corrected Contributions FY2018 FY2017 7/28/2017 Capital Capital Other Prior to Draft Percent Amended Amended Reserve Reserve Available Other Amended Share Budget *(1)Budget *(1)Contributions _Contributions J Funds Available Funds Budget 39.38%328,240 212,600 1,246,143 1,101,213 144,930 381,451 236,521 0.00%------- 41.44%129,600 83,920 1,443,286 1,158,819 284,467 401,405 116,938 17.88%148,960 96,480 565,796 499,992 65,804 173,193 107,389 0.00%182,400 :---.- 1.30%10,800 7,000 41,137 36,353 4,784 12,592 7,808 (1)1 100.00%800,000 400,000 3,296,363 2,796,378 499,985 968,640 468,657 FY2018 Percent FY2017 FY2018 March -June Share Monthly Monthly Monthly *(2) 39.38%----:-59,130 0.00%------- 41.44%------29,235 17.88%------26,847 0.00%------- 1.30%-----.1,952 100.0%:--.--117,164 *(1)The amounts for FY2017 and FY2018 07/28/17 Amended Budget are the actual budgeted amount paid by the participants directly to AEA,these payments were not required to be made to the Trustee. See schedule H for the true up of these payments to the final percentages agreed to above. The true up will be made with the utilities in FY18. *(2)The first payment for FY18 is due on March 1.The annual payments will be made in 4 equal payments. 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xlsxSch G Page 17 of 18 ALASKA ENERGY AUTHORITY BRADLEY LAKE HYDROELECTRIC PROJECT Battle Creek Capital Reserve Fund and Contribution True Up Power Purchaser Power Purchaser Power Purchaser Allocation Allocation (original)(corrected) Chugach Electric Association 39.38%39.38% Homer Electric Association 45.61%41.44% Matanuska Electric Association 17.88%17.88% City of Seward 1.30%1.30% Total Allocation 104.17%100.00% Capital Reserve Fund Tue Up |ORIGINAL i Chugach Electric Homer Electric Matanuska Electric Capital Reserve Fund Requirements Before Close Association Association Association City of Seward Total Variance Series A $3,069,334.00 1,208,703.73 1,399,923.24 §48,796.92 39,901.34 3,197,325.23 (127,991.23) Series B 95,073.00 37,439.75 43,362.80 16,999.05 1,235.95 99,037.54 (3,964.54) Series C -----.: Total Payment by Purchaser $3,164,407.00 1,246,143.48 1,443,286.03 565,795.97 41,137.29 3,296,362.77 (131,955.77)|}Over payment by HEA 4 Corrected.»| Chugach Electric Homer Electric Matanuska Electric Capital Reserve Fund Requirements After Close Association Association Association City of Seward Total Variance Series A $2,712,362.08 1,068,128.19 1,124,002.85 484,970.34 35,260.71 2,712,362.08 - Series B 84,015.42 33,085.27 34,815.99 15,021.96 1,092.20 84,015.42 - Series C -5 5 -.-- Total Payment by Purchaser $2,796,377.50 1,1014,213.46 1,158,818.84 499,992.30 36,352.91 2,796,377.50 - Due to (from)368,029.50 144,930.02 284,467.20 65,803.67 4,784.38 499,985.27 (131,955.77)Over payment by HEA $1,200,000 Contribution TrueUp [|-”ORIGINAL -ACTUAL CONTRIBUTIONS i Golden Valley Electric Chugach Electric Homer Electric Matanuska Electric Contributions Association Association Association Association City of Seward Total $800,000 |$182,400.00 328,240.00 129,600.00 148,960.00 10,800.00 800,000.00 $400,000 :212,600.00 83,920.00 96,480.00 7,000.00 400,000.00 Total Payment by Purchaser $182.400.00 540,840.00 213,520.00 245.440.00 17,800.00 1,200.000.00 k Torected <Contributions,D | Golden Valley Electric Chugach Electric Homer Electric Matanuska Electric Contributions Association Association Association Association City of Seward Total $800,000 |$:315,040.00 331,520.00 143,040.00 10,400.00 800,000.00 $400,000 {$-157,520.00 165,760.00 71,520.00 5,200.00 400,000.00 Total Payment by Purchaser $:472,560.00 497,280.00 214,560.00 45,600.00 1,200,000.00 $800,000 Due to (from)182,400.00 13,200.00 (201,920.00)5,920.00 400.00 : $400,000 Due to (from)-55,080.00 (81,840.00)24,960.00 1,800.00 - Total Due to (from)182,400.00 68,280.00 (283,760.00)30,880.00 2,200.00 - 1/25/20182:52 PMA -2018 BradleyBudgetAmendement-Draft-020218.xisxSch H Page 18 of 18 Bradley Lake Project Management Committee Meeting Friday,February 2,2018 Agenda Item:7B MOTION: Move: Second: Move that the Bradley Lake Project Management Committee approve the second amendment to the fiscal year 2018 Bradley Lake Hydroelectric Project budget.This includes an increased budget of $968,642 for debt services payments and administrative costs of the West Fork Upper Battle Creek project to be paid for by the Battle Creek Participating Utilities. Bradley O&D Report to the BPMC February 2,2018 1.Bradley spin contribution -Currently 27 MW's a.The O&D is reviewing reducing the total spin contribution for the Project.The current contribution was based on 25%of the largest base load generation resource in operation when Bradley Lake came on line (ML&P unit 7/6 @ 108 mw's).108 x 25%=27 mw's.The current largest base load unit(s)in the system are 60 mw's.Using the same methodology,the Project spin contribution would be reduced to 13.5 mw's. 2.Bradley response during system contingencies a.The O&D has reviewed several Railbelt generation trips dating back to October 2017. During each one ofthe events,Bradley Lake did not provide any governor response before the grid reached minimum frequency.However,Bradley did contribute to the recovery of the system within the Recovery Period. 3.Fish water automation a.Communication upgrades complete.Emerson provided an estimate of $157k for the software side of the project including programing.The Project currently over-releases water by about 30%to minimize violations.Automating fish water release is expected to significantly reduce over-release a.O&D directed HEA to move forward with Emerson to begin software design. 4.Project O&M cost allocation Study a.The O&D has had preliminary discussions.The item is on the next agenda. 5.Chugach providing day ahead aggregate schedule to the Participants a.Atthe request of the O&D,Chugach is providing all Participants a day ahead hourly allocation of energy,available capacity and any negotiated capacity transfers. 6.Preliminary budget review scheduled for the February 8th O&D Meeting Bradley Lake Operator Report BPMC Unit Statistics: January 19,2018 as of 01/16/2018 Generation Unit 1 (MWhrs)Unit 2 (MWhrs)Total (MWhrs) December 2017 22,106 19,352 41,458 Hydraulics Avg.Lake Level (ft.)Usage (ac ft.)Fish water (ac ft.) December 2017 1158.17 37,088 111.50**AVG Lake Level -1150.0'as of 01/16/2018 **Fish water had flows >800 CFS with no release at the dam in December Capital Projects: 1)Unit 2 high PD indication -The report from IRIS was inconclusive -no change at this time.The report recommends further monitoring. 2)Fish Water Control Automation -North Fork charging system has failed (common during the winter due to lack of sunshine).We are starting the automation part of the project and the O&D committee has recommended we work with Emerson. 3)Loader Purchase -Based on the recommendation of the O&D the award was made to CAT.We did receive a complaint from Craig Taylor (Doosan)but that complaint was summarily dealt with. 4)UPS Failure -The Uninterruptable Power System (UPS)has failed,cause unknown we suspect the transformer,we have a spare on site.We are working on getting a technician on site to repair the system. 5)Budget -being prepared. Operations,Maintenance,and Inspections: 1)Inflows -In spite of winter conditions inflows of 15,899 were recorded in December. 2)Operations-Operations at the Plant were normal with no anomalies or upsets. 3)Unit availability-Unit 1 100%,Unit 2 100% 4)Winter Prep -It has been a winter of rain,rain,rain with lots of icing conditions.Last week we couldn't even drive the trucks with chains. 5)LED lights in Powerhouse -Completed the installation of the LED lights in the upper powerhouse.Payback in about 2 years due to savings. 6)Monthly Safety Meeting -was held December 18. 7)Holidays and vacations -Due to the holidays and vacations this month it meant we operated with a reduced crew at times. Bradley Lake Operator Report Page 1 Bradley Lake Project Management Committee -Alaska Online Public Notices Page 1 of 1 "a STATUS:Active Bradley Lake Project Management Committee ALASKA ENERGY AUTHORITY (AEA) Bradley Lake Project Management Committee Notice is hereby given that the Bradley Lake Project Management Committee will hold a regular meeting on Friday,Feb 2,2018 at 10:30 a.m.For additional information contact Teri Webster at 907-771-3074. This meeting will be conducted by electronic media pursuant to AS 44.62.310 at the following location: Alaska Energy Authority Board Conference Room,813 West Northern Lights Boulevard,Anchorage,Alaska; A teleconference line has been set up for those unable to attend in person.Dial 1-888-585-9008,Enter Code 467-050-1 26#. 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 BPMC Agenda 2-2.pdf Department:Economic Development and Revision History Category:Public Notices Created 1/26/2018 12:01:36 PM by Sub-Category: tawebster Location(s):Statewide Modified 1/26/2018 4:25:43 PM by [Details]Project/Regulation #: tawebster Publish Date:1/26/2018 Archive Date:2/3/2018 Events/Deadlines: https://aws.state.ak.us/OnlinePublicNotices/Notices/View.aspx?id=188586 1/26/2018 Bradley Lake Project Management Committee -Alaska Online Public Notices Page 1 of 1 STATUS:Active Meo *Bradley Lake Project Management Committe ALASKA ENERGY AUTHORITY (AEA) Bradley Lake Project anNoticeisherebygiventhattheBradleyLakeProject Management Committee will hold a regular meeting on Friday,Feb 2,2018 a 00 a.m.For additional information contact Teri Webster at 907-771-3074. This meeting will be conducted by electronic media pursuant to AS 44.62.310 at the following location: Alaska Energy Authority Board Conference Room,813 West Northern Lights Boulevard,Anchorage,Alaska; A teleconference line has been set up for those unable to attend in person.Dial 1-888-585-9008,Enter Code 467-050-1 26#. The public is invited to attend.The State of Alaska (AEA)complies with Title Il of the Americans with DisabilitiesActof1990.Disabled persons requiring special modifications to participate should contact AEA staff at 907- 771-3074 to make arrangements. Attachments,History,Details Attachments Details BPMC Agenda 2-2.pdf .Commerce,Community andDepartment:Economic Development Revision History Category:Public Notices Created 1/26/2018 12:01:36 PM by tawebster Sub-Category: Location(s):Statewide Project/Regulation #: Publish Date:1/26/2018 Archive Date:2/3/2018 Events/Deadlines: https://aws.state.ak.us/OnlinePublicNotices/Notices/View.aspx?id=188586 1/26/2018 11. 12. BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE REGULAR MEETING{Ay Friday,Feb 2,2018 10:30 A.M. Alaska Energy Authority,Board Room 813 W.Northern Lights Boulevard,Anchorage,Alaska To participate VIA TELECONFERENCE-1-888-585-9008 -Conference room code 708 329 368 Emly Ue AGENDA Leo QVEW CALL TO ORDER ROLL CALL FOR COMMITTEE MEMBERS PUBLIC ROLL CALL PUBLIC COMMENTS AGENDA APPROVAL PRIOR MINUTES --Dec 1,2017;Dec 6,2017;Dec 12,2017 NEW BUSINESS A.Battle Creek Diversion Project Update B.West Fork Upper Battle Creek FY18 Budget AEA Back up detail for page 16 C.Surplus Bradley Equipment HEA REPORTS e O&D REPORT -ML&P e OPERATORS REPORT COMMITTEE ASSIGNMENTS pep pick-off TH teMEMBERSCOMMENTSZ-\lu Budgt 201%KBevier)Brbawuctree NEXT MEETING DATE -Monday,March 5,2018 cOY\ ADJOURNMENT Current minutes Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages. Suggested edit of minutes.to reflect intent and outcome. The non-participating utility,GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities original project capacity percentages.AIWIL&P Battle Creek shares are allocated to HE ortayneal Current minutes Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages. Suggested edit of minutes to reflect intent and outcome. The non-participating utility,GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities original project capacity percentages.AI|WAL&P Battle Creek shares are allocated to HE OF tavnsak BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING ATELEPHONICMEETINGKo Rad Alaska Energy Authority,Anchorage,Alaska \ December 13,2017 1.CALL TO ORDER BPMC Secretary Bryan Carey called this telephonic meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 12:10 p.m.an 2.ROLL CALL FOR COMMITTEE MEMBERS | Bob Day (Homer Electric Association [HEA]);Bryan Carey (Alaska Energy Authority [AEA]); Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association[MEA]);John Foutz (City of Seward);and J eff Warner (Anchorage Municipal Light &Power[ML&P}).Ce No The Chair and Vice-Chair were not present.Mr.Carey called for a motion to elect a chair totoday's meeting.Mr.Izzo made a motion for Mr.Thibert to be the Chair for the meeting.MotionwassecondedbyMr.Day.Vote was taken and it was unanimous approved. Chair Thibert took over the 'mecting and asked for :aToll call of the public.3.PUBLIC ROLL CALL.peKM%4 i.Se >Burke Wick,Brian Hickey,Josh Resnick,Sherri Highers and Mark Johnson (CEA);Bob Day,Emily Hutchinson and Larry Jorgensen (HEA);Kirk Gibson (McDowell Rackner Gibson,PC);Brian Bjorkquist (Attorney General's Office);Tony Zellers and Matt Reisterer (MEA);AmyAdler,.Kirk Warrenand Teri Webster,(AEA)._4.PUBLIC COMMENTS NS None \4 " 5,AGENDAAPPROVAL MOTION:Mr.Day mmade a motion to approve the agenda.Motion seconded by Mr. Warner. Vice-Chair Cory Borgeson joined in the call at 12:16 p.m.He asked Mr.Thibert to continue being the chair for the rest of the meeting. 6.NEW BUSINESS 6A -Non Participating Utilities Selling Shares for Battle Creek BPMC Minutes 12/13/17 Page 1 of2 GVEA and ML&P are not participating in the Battle Creek project.They had until today to sell their shares to another utility.Mr.Borgeson stated he did not receive any offers for GVEA shares.Mr.Warner stated ML&P received one offer to purchase the 25.9%capacity rights for the Battle Creek diversion project and ML&P has accepted the offer from 'Ve to purchase allofML&Ps shares.ohanr Non Pobiupaats whldy GVZA..Lee,MarknceML&P shires are allocated to HEA then the shares from the non-participatingtityeoGVEA(16.9%)will be put in a pool for the participating utilities and will be divided up pro rataaccordingtoeachBattleCreekparticipatingutilitiescapacitypercentages. i bnair Thibert requested AEA to send out the new Battle Creek capacity percentages to the groupthisweek. 7.MEMBERS COMMENTS " Mr.Izzo stated his disapproval of giving non--participating utilities ¢an avenue to sell shares theydonothavesincetheyarenotparticipatingintheproject.' Mr.Foutz agreed with Mr.Izzo's comments and stated he did not like how ML&P changed therulesoncetheplanswerealreadyinplace.aes Mr.Borgeson apologized for not beingPresent at the beginning of the meeting.He was delayedinapriormeeting.;m8 All the committee membersthanked Mr.Thibert for filling iin ass chair for the meeting today.Mr.Carey thanked Mr,1220 for hisparticipation at the AEA board meeting on December 7".Mr.Thibert thanked AEA for all the extra timethey have put in to get the financing complete fortheBattleCreekproject..78.NEXT MEETING DATE-January 19;2017 9.ADJOURNMENT There being no further business for the committee,the meeting adjourned at 12:23 p.m. _BY:Nounglee Thibert,Chair Attest: Bryan Carey Alaska Energy Authority,Secretary BPMC Minutes 12/13/17 Page 2 of2 - ce on |_ATTENDANCE -BPMC MEETING,Feb 7@10:30 amCOMMITTEEMEMBERSALTERNATE_;Y Cory Borgeson,Chair J._-YeveapphLeoQuiachon 4 : ;feetThibert,ViceChair J CEA BurkeWick 4aSoaJanorschkevo|HEA _Bob Day A : __|_”|BevanCatey-SecroteryfTreasurer+|AEA |"Kirk Warren Janet ReseronyIzzoAaa_MEA "3Tony Zellers _Z aMark«Johnston /MLP i,"Jeff Warner7-fsobn Foutz 7 i,SEW i /re Public Members COUNSEL CEA |-_Brian-Hickey (CEA}>Brien-Hi Kirk Gibson,McDowell Rackner&Gibson PC a"|Mark Johnson (CEA):|Brian Bjorkquist,Dept.of Lawva Sherri Higher(CEA) Paul Risse (CEA)__'AEA |uBrendaApplegate:-ve'Josh Resnick (CEA)Sf -Amy Adler aa HEA Rich Baldwin(HEA)Jocelyn Gardner _-|PE Alan Owens (HEA)4 Brandi WWhite 7 Tanaevs)Emily HtHutchinson(HEA)J Carmen Noble 4 a Oe Larry Jorgensen (HEA)Y Aeri Webster "MLP |_|AnnaHenderson (MLP)BO paid Lockad "|a |Molly Morrison (MLP)vare iy irk Warren 4 --- GVEA |Ron WWoolf(GVEA)ee ie "Janet Reiser oy oe _ fd Pete Sarauer (GVEA)_ae |Valerieteavitt =MEA |Jim Brooks (MEA)|Jessica Houston Oe : |_|David Pease (MEA)-Tom AeMattReisterer(MEA)Public |Bernie Smith Y 7:: So -|Crystal EEnkvist (APA):; |MelHutchinson (APA)/: |TW Patch :;:oo -"Fred Eoff (PFM)re ee ee -_ | "|CindyCartledge (JDO): : -Eric MMyers (American Transmission Co)a |:// :- Bradley Lake Project Management Committee Cc Friday,February 4/2018 @ 10:30 am **PLEASE WRITE LEGIBLY** NAME ORGANIZATION Jel paw LTE fpBowerbotsYAs6¢e Leom,"SE MIEHS 7LERWESSSyACu BlL dC Lanny)Worgeasen HEA Bols Day HEAre|UN ERENigMocvisenMCV /Quen N\@ PEKSeshResmeihCheach, Socelyn Garner \ Wile Warcten \oR "Brands Wide Scr "fom EticksLadonnaLOW,rcaae5MAXByros9tasnaaAGOBendoRepleaateOYLecaN Corman Nadie.\REA'Tor \we bse 2. Dawid Locka A |Berne Sud Pwblic. Correction foe ize Meebwy Minutes Current minutes Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages. Suggested edit of minutes to reflect intent and outcome. The non-participating utility,GVEA (16.9%)will be put in a pool for the participating utilities and will be - divided up pro rata according to each Battle Creek participating utilities original project capacity percentages.AIWAL&P Battle Creek shares are allocated to HEA,. of tevnsak 6 syoc Cesion -Financial Basie Creek BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE \lO-ZO \ ct f First Second First Second First Seconddy First SecondBPMC2/4/18 fhate]VO"|ot]fay]|pce NOAA .Roll Call Agenda Dee 'Bud getRollcallfromtoptobottomendingwithChair Yes No Yes No Yes No Yes No Yes No Matanuska Electric Association Tm y¥"4 Chugach Electric Association -" City of Seward -.a Golden Valley Electric Association " Municipal Light &Power -A Homer Electric Association "a Alaska Energy Authority a Z First Second First Second First Second First Second First Second Roll call from top to bottom ending with Chair Yes No Yes No Yes No Yes No Yes No Matanuska Electric Association Chugach Electric Association City of Seward Golden Valley Electric Association Municipal Light &Power Homer Electric Association Alaska Energy Authority Next Meeting:3/5/18 Th BCD Fedoluhon Omenknat By share LonsuageTHBOluckoF+4 wi,aut)Be.Ladgef Signe contrast-CaryWantsCePyGrinMarietpBPC we TC SVelicles -Dispane sak SOK whattedo ul noney,FEUD \cafpe 4D sell 20-30 Srtaga vbeus Cag bet)larger au -ASA wilk Nwe to.do uspasa since ThOY AL tateBFfetsWarnsdeta\v$Now to dispose.Procurement vs)de research t+Come back.oF ned Wg.(BE fr bage Timeline Crunch.TOM+AEA ©disposeOSNecessary.No need km cane back.BYO "Tony -Ya Staff NBO.TLS ach, Erec Sessom [(20 Tohn Mat BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING TELEPHONIC MEETING Alaska Energy Authority,Anchorage,Alaska December 13,2017 1.CALL TO ORDER BPMC Secretary Bryan Carey called this telephonic meeting of the Bradley Lake Hydroelectric Project Management Committee to order at 12:10 p.m. 2.ROLL CALL FOR COMMITTEE MEMBERS Bob Day (Homer Electric Association [HEA]);Bryan Carey (Alaska Energy Authority [AEA]); Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association [MEA]);John Foutz (City of Seward);and Jeff Warner (Anchorage Municipal Light &Power [ML&P]). The Chair and Vice-Chair were not present.Mr.Carey called for a motion to elect a chair to today's meeting.Mr.Izzo made a motion for Mr.Thibert to be the Chair for the meeting.Motion was seconded by Mr.Day.Vote was taken and it was unanimous approved. Chair Thibert took over the meeting and asked for a roll call of the public. 3.PUBLIC ROLL CALL 5.AGENDA APPROVAL MOTION:Mr.Day made a motion to approve the agenda.Motion seconded by Mr. Warner. Vice-Chair Cory Borgeson joined in the call at 12:16 p.m.He asked Mr.Thibert to continue being the chair for the rest of the meeting. 6.NEW BUSINESS 6A -Non Participating Utilities Selling Shares for Battle Creek GVEA and ML&P are not participating in the Battle Creek project.They had until today to sell their shares to another utility.Mr.Borgeson stated he did not receive any offers for GVEA shares.Mr.Warner stated ML&P received one offer to purchase the 25.9%capacity rights for BPMC Minutes 12/13/17 Page 1 of2 __™the Battle Creek diversion project and ML&P has accepted the offer from HEA to purchase all of ML&Ps shares. 4 Gace ML&P shares are allocated to HEA then the shares from the non-participating utility(2 GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rataaccordingtoeachBattleCreekparticipatingutilitiescapacitypercentages. nN ee hair Thibert requested AEA to send out the new Battle Creek capacity percentages to the groupvMhisweek. 7.MEMBERS COMMENTS Mr.Izzo stated his disapproval of giving non-participating utilities an avenue to sell shares they do not have since they are not participating in the project. Mr.Foutz agreed with Mr.Izzo's comments and stated he did not like how ML&P changed the rules once the plans were already in place. Mr.Borgeson apologized for not being present at the beginning of the meeting.He was delayed in a prior meeting. All the committee members thanked Mr.Thibert for filling in as chair for the meeting today. Mr.Carey thanked Mr.Izzo for his participation at the AEA board meeting on December 7". Mr.Thibert thanked AEA for all the extra time they have put in to get the financing complete for the Battle Creek project. 8.NEXT MEETING DATE --January 19,2017 9.ADJOURNMENT There being no further business for the committee,the meeting adjourned at 12:23 p.m. __BY:hxr$lee Thibert,Chair Attest: Bryan Carey Alaska Energy Authority,Secretary BPMC Minutes 12/13/17 Page 2 of2 aohag' BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING REGULAR MEETING Alaska Energy Authority,Anchorage,Alaska December 1,2017 1.CALL TO ORDER Chair Janorschke called the regular meeting of the Bradley Lake Hydroelectric ProjectManagementCommitteetoorderat10:03 a.m.On 2.ROLL CALL FOR COMMITTEE MEMBERS Cory Borgeson (Golden Valley Electric Association IGVEA));Bryan Carey (Alaska EnergyAuthority[AEA]);Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (Matanuska Electric Association [MEA]);Jeff Warner (Anchorage Municipal Light &Power [ML&P]);JohnFoutz(phone)(City of Seward);and Brad Janorschke (Homer ElectricAssociation [HEA]).". 3.PUBLIC ROLL CALL SQ OY ON . Amy Adler,Brenda Applegate (phone),Tom Erickson (phone),Kirk Warren,Teri Webster,Brandi White (AEA);Crystal Enkvist (Alaska PowerAssociation);Brian Hickey,Sherri Higher,MarkJohnson,Josh Resnick (CEA);Brian Bjorkquist (Department of Law);Leo Quiachon,Ron Woolf (phone)(GVEA);Bob Day,Alan Owens (phone),Larry Jorgensen (HEA);Cynthia Cartledge(Jermain,Dunnagan &Owens):Kirk Gibson (McDowell Rackner Gibson,PC);Matt Reisterer,David Pease,Tony Zellers (MEA);Molly Morrison (ML&P);Fred Eoff (phone)(PFM GroupConsulting);TW Patch (Public);Bernie Smith (Public);Gary Dixon,Lee Wassilie (Swalling &Associates);and SydneyHamilton (AccuType Depositions).4.PUBLIC COMMENTS.a,:None."mo KO Se -Pe5.AGENDA arpnGval SO_.\. ° MOTION:Mr.Carey made a motion to add two items under 7D-Clarification AmendmentsandProposalbyGVEAtoResolution2017-02;and add an Executive Session to discuss draft term sheets and negotiated strategy.Motion seconded by Mr.Thibert. The amended agenda was unanimously approved. 6.APPROVAL OF PRIOR MINUTES MOTION:Mr.Izzo made a motion to approve the minutes of September 29,2017,and October 13,2017.Motion seconded by Mr.Thibert. Motion passed unanimously. 7.NEW BUSINESS DRAFT BPMC Minutes 12/1/17 Page 1 of6 A.Approval of Annual Audited Financial Statements Chair Borgeson introduced Mr.Dixon of Swalling and Associates to review the June 30,2017, Financial Statements of the Operating Fund and the Revenue Fund.Mr.Dixon stated members were provided copies of the financial statements and noted they are posted to the AEA website. Mr.Dixon informed the statements'sole purpose is for the Committee to know and approve the refunds for the member utilities.The statements do not have to follow generally accepted accounting principles.The auditing is conducted under generally accepted auditing standards relevant to special-purpose financial statements.The statements were created in the same manner as prior years.No adjustments were made in the sequence of events and no difficulties were encountered with AEA staffin retrieving information.The statements include supplementaryinformation.The opinion is not modified.y Mr.Dixon gave a detailed analysis of each page of the report.The 2017 Payable to Utilities O&Mrefundis$1,223,409.The 2017 Payable to Utilities R&C refundis $1;147,663.Both payables willbebroughtbeforetheCommitteeforapproval|ina|resolution laterin the meeting.Mr.Borgeson inquired as to the reason for the |increase in Due to Others from $15,048in 2016 to$622,007in 2017.Mr.Dixon believes the difference reflects a timing issue in June of whenpayablescameinandwerebooked,but not yet reimbursed.Mr.Dixon stated he will take the listfromtheprioryearandcompareit,and report back to theCommittee.Mr.Borgeson asked if the efforts for Battle Creek'are included iin this audit.Mr.Dixon advised the original events went throughthe R&C Fund...The funding from theParticipating utilities has beensegregatedandisnotincluded|in this audit...'Ss Bo ae, Mr.Dixon expressed 'appreciation to Ms.Applegate,Ms.Gamer,'Ms.Adler,and staff for theirparticipationintheprocessandcontinueddiligenceforBPMC.Chair Janorschke expressedappreciationadditionallyto.Mr.Woolf and the Finance Committee for their work.MOTION:Mr.Borgeson made a motionto accept the FY17 Audited Financial Statementsandapproveatotalrefundtotheutilitiesof$2,371,072,of which $1,223,409 from O&M and$1,147,663 from R&C funds."Mr.Izzo'seconded the motion.Motion passedunanimously..B.Operator FRFP updateMr.Carey informed MEA and ML&P will not be submitting an RFP for operator.Both utilities have submitted a representative for the working group to develop the scope criteria for evaluating proposals.Mr.Carey provided and reviewed the draft schedule for the procurement.The scope and criteria could be completed by the end of January.The due date could be April 1.The contractor might be known in May and could be ready to take over on January 1,2019.The HEA contract ends on December 31,2018. C.Soldotna SVC O&M Agreement update Chair Janorschke informed the SVC O&M Agreement expired the end of 2013,and CEA has continued to maintain the O&M.HEA will take over the service as of January 1,2018.The draft DRAFT BPMC Minutes 12/1/17 Page 2 of 6 agreements are being reviewed.The final agreement is anticipated to be distributed to the Committee about a week before the January BPMC meeting,at which time,it will be addressed. D.Battle Creek e Project Update Mr.Carey noted the bid opening was held on November 8th,and drew in six contractors.The low bid of $36.5 million came in from Orion Marine Contractors.The engineer's estimate came in at $38.1 million.The Notice of Intent to Award cannot be given until financing is in place.Mr.Carey relayed anecdotal information on Orion Marine Contractors,noting good performance on a currentprojectinJuneau."4 Mr.Carey informed he has the list of subcontractors,but may not be able to release them at thistime.State procurement officers have requested Orion Marine Contractors provide references. Mr.Erickson stated the evaluation process includes review of references,prior projects,financial information,equipment financing,insurance and bonding.Mr.Carey noted he can keep theBPMCapprisedoftheongoingvettingprocess.- ' %. N.e Contract Housing ApprovalON SON,aa -;S %Mr.Warner,as Chair of the O&D Committee,informed BPMC asked for the Committee to reviewpossiblehousingneedsfortheprojectsupportstaff.The option for support staff to stayin thecrew's quarters at piceLakeis suggested to be set att $65 a night per person.The contractorswillhavetheirowncamp..:\.--ONMOTION:Mr.Thibert made a motion to approve the use of the Bradley Project facilities bythesupportcontractorsatarateof565perPersonpernight.The motion was seconded.Mr.Warner stated the use6 of the crews'quartersby project support staff poses no concern ofinterferencewiththeoperation.Use of the kitchen jis includedin the terms.Foodis not included.SeMotionpassedunanimously.°YON % %&.@ Clarification Ameindments and proposal to Resolution 2017-02SNxMr.Gibson cited inconsistencies in Resolutions 2017-02.He provided a red-line document toaddresstheclarificationsandcapturetheintentoftheBPMC.The first proposed changeis on page three,to delete "tentatively November 8,”and replace "November 30"with "December 6,”as the date upon which participation should be noticed.The next proposed change is to clarify the next to the last Be It Further Resolved,with respect to what amounts a non-participating purchaser would have to pay to becomea participating purchaser.The recommendation is to remove the word "including"and replace with "to include only,"and then list the particular items that a non-participating purchaser would have to pay. Mr.Izzo expressed concern regarding the phrase "to include only,”because it removes BPMC's ability to address potential unforeseen risks that are not specifically stated in the language. MOTION:Mr.Borgeson made a motion to adopt the changes in the first amendment to Resolution 2017-02 Battle Creek Diversion Project.Mr.Warner seconded the motion. DRAFT BPMC Minutes 12/1/17 Page 3 of6 Mr.Gibson advised all unforeseen circumstances that were financed will be shared by newly participating purchasers upon buy-in. Mr.Borgeson stated the language provides significant clarity on what is included for future participants. MOTION:Mr.!zzo made a motion to amend the motion to adopt the changes in the first amendment to Resolution 2017-02 by removing the words,"include only,"and go back to the original wording of,"including."Mr.Thibert seconded the motion. Mr.Thibert commented he understood the original motion language was deliberate and intendedtospecificallyincludeonlytheitemslisted.4 Mr.Warner believes the specific language was chosen to clarify intent. Motion to amend the motion to adopt the changes in the first amendment to Resolution2017-02 by removing the words,"include only,"and go back to the original wording of,"including,”failed,with Mr.Izzo and Mr.Foutz voting in favor. Motion to adopt the changesin the first amendment to Resolution 2017-02 Battle CreekDiversionProjectpassedunanimously.at Mr.Gibson informed GVEA proposed an amendment regarding the sale or transfer of BattleCreekDiversion(BCD)shares to and from participating and non-participating purchasers.Theamendmentwordingwasprovidedtomembersandinsertedintwosectionsoftheresolution.Thelanguageispermissiveandallowsnon-participating purchasers to sell or transfer their right to participate.As itis written,the non-participating purchaser has to give notice and buy-in tobecomeaparticipatingpurchaserbeforetheycansellortransfertheirshares.MOTION:Mr.Borgeson made a motion to add the proposed language to the firstamendmenttoResolution2017-02 Battle Creek Diversion Project regarding the ability for a non--participating utility to sell their right to participate to a participating or non-participating purchaser.Mr.Warner seconded the motion.Mr.Thibert expressed opposition to the motion because he does not believe the non-participatingpurchasershavetherighttosellortransfersharestheydonotown.The decision to participate or not participate has to be made by December 6thin order to continue with 100%financing.Mr.Thibert understands a non-n-participant can become a participant at a later date and subsequentlyselltheirshares.Se f 4 Mr.Izzo expressed opposition to the motion because he does not believe a non-participant can sell their value without having paid in. Mr.Warner agreed with Mr.Gibson that the amendment removes one step of the process of transfer or sale of shares and the ultimate result is the same with or without the amendment. A roll call was taken,and the motion to add the proposed language to the first anendment to Resolution 2017-02 Battle Creek Diversion Project regarding the ability for a non- participating utility to sell their right to participate to a participating or non-participating purchaser failed,with Mr.Borgeson,Mr.Warner,and Mr.Foutz voting in favor. DRAFT BPMC Minutes 12/1/17 Page 4 of6 e Battle Creek Financing Q&A Mr.Eoff gave a comprehensive overview presentation on the Battle Creek financing.After reviewoftheloanproposals,National Rural Utilities Cooperative Finance Corporation (CFC)was selected for financing.The loan commitment on the term sheet is $47 million,bifurcated into three series to accommodate the success of garnering interest rate subsidy programs.Series Aof$40 million is connected to an interest rate subsidy through the New Clean Renewable EnergyBonds(NCREB)program at 70%of the basis rate,subject to a 6%sequestration holdback. Mr.Eoff explained Series B is expected to be connected to an allocation from the State of Alaska for about $2.1 million under the Qualified Energy Conservation Fund program at 70%of the basis rate.The State Bond Commission will meet on Dec 4 to review our request.Series C of about $4.8 million is the balance of the total loan commitment at the CFC loan interest rate and will onlybedrawnforprojectcosts.Thereis a reasonable chance the Battle Creek project may becompletedwithouthavingtodrawanyoftheSeriescloan.aeMr.Eoff reviewed the financials under each of the :scenarios provided.Financing proceeds areanticipatedtobeappliedtotransactionexpenses.Mr.Eoff noted he has been informed theutilitieshaveelectedtofundthecapitalreservefundthroughacashcall.Mr.Eoff reported the tax bill Congressis currently trying to pass may create apotential sequestration impact on the interest rate subsidy program relating to the Pay-As-You-Go(PAYGO)statutory restriction from 2010...He explained an exception to the restriction could bepassedwith60votesintheSenate.Another potential impact to the interest rate subsidies could be triggered from the likely significant federal deficit associated with the tax bill.Mr.EoffcommentedthehopeandexpectationisCongresswilldetermine|a solution to the PAYGOrestriction.goo a \eo rnMr.Borgeson inquired as to the cost of power f the interest rate subsidy was not available.Mr.Eoff indicated the average cost of power over 30 years under the optimal scenario with the fullbenefitoftheinterestratesubsidyisapproximately$58 per megawatt hour.With no interest ratesubsidyundertheoptimalscenario,the average cost of power is approximately $76.30 permegawatthour.Under the full draw scenario over.30 years,the average cost per megawatt hourincreasesfrom$65.60 to $85.MOTION:Mr.Carey made a'motion togo 'into Executive Session to discuss confidential term sheets and negotiating Strategy.Mr.Borgeson seconded the motion.Motion passed without objection.e Executive Session:11:53 am. The Committee reconvened its regular meeting at 12:26 pm. 8.COMMITTEE REPORTS O0&D Committee Mr.Warner reported the O&D Committee discussed the O&M cost analysis assignment and decided a better understanding of the current maintenance of the facility is needed for the DRAFT BPMC Minutes 12/1/17 Page 5 of 6 analysis.HEA is working to provide the information for discussion at the next O&D meeting.Mr. Warner will continue to provide updates. Finance Subcommittee Mr.Carey reported the RFP for the insurance review for Bradley and Intertie resulted in one proposal for approximately $12,000.The proposal was forwarded to Mr.Woolf to confirm the desire to award. 9.OPERATOR REPORT Me:7foMr.Day provided the Operator's Report to members.He reported Bradley operated at basically100%availability this month and Unit Two was electivelytaken out of service for six hours.Mr.Day noted the LED lightsin the power house are performing effectively and providing savings dueprimarilytotheoccupancysensor.ey!: Mr.Quiachon expressed appreciation to Mr.Day for hosting him during his recent visit to Bradley. He commented on theimpressive state,condition and operation of the Plant.He believes there isahighprobabilityofmeetingthe50-year license extension.Se oy 10.COMMITTEE ASSIGNMENTS None. 11.MEMBERS COMMENTS Mr.Carey informed the new Executive Director will begin iin January as the BPMC representative.He expressed appreciation for all thework on.hefinancing.'Mr.Thibert expressed appreciation to AEA and Finance Committee for their diligent work.Mr.Borgeson andChair Janorschke echoed the appreciation for the work on financing,and for thecleanaudit.a 'gD 9.NEXTMEETING DATE -Wednesday,December 6,2017 BY:: JBradleyJanorschke,Chair 84"hg gea Attest: Bryan Carey Alaska Energy Authority,Secretary DRAFT BPMC Minutes 12/1/17 Page 6 of6 Current minutes Once ML&P shares are allocated to HEA then the shares from the non-participating utility GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities capacity percentages. Suggested edit of minutes to reflect intent and outcome. The non-participating utility,GVEA (16.9%)will be put in a pool for the participating utilities and will be divided up pro rata according to each Battle Creek participating utilities original project capacity percentages.AIWYL&P Battle Creek shares are allocated to HE ov tavncek REGULAR MEETING Alaska Energy Authority,Anchorage,Alaska December 6,2017 BRADLEY LAKE PROJECT MANAGEMENT COMMITTEE MEETING ya 1.CALL TO ORDER Chair Janorschke called the regular meeting of the Bradley Lake Hydroelectric ProjectManagementCommitteetoorderat10:03 a.m.a 2.ROLL CALL FOR COMMITTEE MEMBERS _ Cory Borgeson (Golden Valley Electric Association [GVEA]):Bryan Carey (Alaska Energy Authority [AEA]);Lee Thibert (Chugach Electric Association [CEA]);Tony Izzo (MatanuskaElectricAssociation[MEA]);Mark Johnston (phone)(Anchorage Municipal Light &Power[ML&P]);John Foutz (City of Seward);and Brad Janorschke (Homer Electric Association[HEA]).we Ma as,a SyNeBe&Sy % Me'*y <sO3.PUBLICROLLCALL =.a |Qe A Brenda Applegate,Teri Webster,(AEA);Brian Hickey,Sherri Higher,Mark Johnson,Josh Resnick,Burke Wick (CEA);Brian Bjorkquist (Department of Law);Bob Day,Alan Owens,EmilyHutchingson(phone),Larry Jorgensen (HEA);Cynthia Cartledge (Jermain,Dunnagan & Owens);Kirk Gibson (McDowell Rackner Gibson,PC);David Pease,Tony Zellers (MEA);MollyMorrison,Jeff Warner (ML&P);Fred Eoff (phone)(PFM Group Consulting);TW Patch (Public);Bernie Smith (Public);and Debra Mack (Accu-Type Depositions).4.PUBLIC COMMENTS - 5."AGENDA APPROVALMOTION:Mr.Foutz made :a motion to approve the agenda with the included amendmentofDiscussionoftheTimingoftheBPMCAllocationofSharesofBattleCreek,to come before Item 6A.Motion seconded by Mr.Thibert.The amended agenda vwasunanimously approved. 6.NEW BUSINESS Discussion of the Timing of the BPMC Allocation of Shares of Battle Creek MOTION:ML&P hereby moves that:1)The pre-allocation of 100%of the BCD Shares shall be made by the BPMC as of December 6,2017,in accordance with Resolution 2017- 02,as it has been amended;2)Final re-allocation of 100%of the BCD Shares by the BPMC shall be made on or before Noon,December 13,2017;and 3)In the interim period (between the pre-allocation and the final re-allocation of the BCD Shares),Participating BPMC Minutes 12/6/17 Page 1 of6 Purchasers shall have the opportunity to express their interests in acquiring the right to BCD Shares held by Non-Participating Purchasers.Mr.Borgeson seconded the motion. Mr.Izzo requested the process of allocating shares include all BPMC members,and be clear and transparent. Mr.Borgeson informed Attachment 1 to the resolution includes the date of December 6,2017, for the allocation of shares.He requested additional information from Mr.Gibson regarding the impact of changing the date in this motion. Mr.Gibson advised he understands the allocations must be completed before closing.The allocations attach certain financial responsibilities to the individual purchaser.Therefore,any allocation process needs to be completed in sufficient time so the participating purchasers could accommodate all the requirements of the closing.Mr,Gibson informed the BPMC has passedResolution2017-02,including amendments,which causes the decision to be made today,December 6,and affects which funding source can be used.He asked Ms.Cartledge to provideheropinion.4 me Ms.Cartledge explained CFC,the purchaser of the debt obligation,has provided term sheets that have to be assigned to the participating utilities,approved by the BPMC and the AEA,and returned to CFC.The stated date for the assignments is December 6",and no discussion hasoccurredwithCFCregardinganextension..,Certifications are required of the participatingutilitiesandlegalopinionsarerequiredonnbehalfoftheparticipatingutilities.Mr.Carey asked if Ms.Cartledge believes CFC would be agreeable if one or more of the utilitiesindicatetheywouldacceptthetermsheetandtakeupto100%of the project capacity-wise.Ms.Cartledge believes CFC would be agreeable to that scenario.Mr.Gibson explained a purchaser of the Bradley Lake Project iis5 responsible for annual costs. The financiers are looking to the Power Sales Agreement (PSA)for security.The BPMC,under Section 8..of the PSA,has stated this is optional project work and allocations will occur according to Resolution 2017-02 and Attachment 1.°However,if a participant in Battle Creekdoesnotpay,the financiers will look to the purchasers of the Bradley Lake Project to pay annual costs.This risk to all Bradley Lake purchasersis unavoidable,but is minimized byResolution2017-02.. Mr.Johnston explained ML&P'§issue is the risk Mr.Gibson explained and the potential forML&P to be liable for 25%of the $47 million cost of a projectin which ML&Pis not a participant. This motion would provide additional security for ML&P.Mr.Johnston indicated the motion needs to be resolved for ML&P to be inclined to support the bond financing resolution.Mr.Bjorkquist advised Resolution 2017-02 and Attachment 1,E4.,contains the provisiondescribinghowtheparticipatingpurchaserswillholdharmlessthenon-participating purchasers, including how the participating purchasers are going to pay all the costs.He believes this addresses the concern of protecting the non-participating utilities from project costs. Mr.Izzo stated he is not comfortable with the current motion and ML&P's willingness to kill the project over calculations of what he believes could be approximately $92,000 a year.He finds the motion very troublesome. BPMC Minutes 12/6/17 Page 2 of6 Ms.Applegate understands AEA needs the BPMC to pass the financing resolution and to attain 100%project participation allocated by one or more utilities.AEA must have the allocation percentages to calculate the capital reserve requirements for the utilities in sufficient time to provide to the trustee before closing on December 27". Mr.Foutz expressed discomfort with the current motion and wants the project to go forward.He believes the discussions and decisions regarding the relationship between participants and non- participants have already occurred.Mr.Foutz feels this motion could create a bidding war with other utilities over interest in non-participant shares. Mr.Thibert noted he will probably vote for the motion in order to move the project forward.He expressed displeasure with this motion because the issue was brought before the Committee and solved through the passage of a resolution a month ago.Mr.Thibert does not believe the outcome of this unnecessary action will be different from the previous process.Aroll call was taken,and the motion passed,with MEA voting against and HEAabstainingasChair..Battle Creek Diversion Project oa .NON N Sy ',.a y _ A.Review of Battle Creek Resolutions _ e 2"!Amendment to Res 2017-02 e Amendment to Attachment for 2017-02 Mr.Gibson reviewed the details of the 2 Amendment to Resolution 2017-02,which ostensibly allows a non-participating purchaser to sell or transfer its BCD shares to a participating purchaser after providing notice to the BPMC of its arrangement,and allows a non-participatingpurchasertochoosetoparticipateatalaterdateafteranequitablecontributionofthereasonableCostshavebeenPaid.me X ; \ Mr.Gibson reviewed the details of the First Amendment to Attachment 1 to Resolution 2017-02,including B4.,changing the date to December 6".B7.,allocating 100%of BCD shares;and B8.,allowing a non-participating purchaser the right to sell or transfer its BCD shares.TheparticipatingpurchaserthatreceivestheBCDsharesshallberesponsibleforallBPMC financialrequirementsandCallBacknoticeobligationsassociatedwiththeBCDshares.Mr.Gibson created a new definition called Resolution 2017-02,meaning this resolution and any amendments thereto.He believes this will make it easier for the reader. MOTION:Mr.Borgeson made a motion to approve the 2"Amendment to Resolution 2017-02 and approve the 1**Amendment to Attachment 1.Mr.Carey seconded the motion. Mr.Izzo requested clarification on which part of the amendment is a revisitation of what the Committee voted on last Friday.Mr.Gibson answered the motion provides the ability for non- participating purchasers to sell or transfer their rights to shares to a participating purchaser. The process to activate the shares requires giving notice and reimbursing the initial funding to the participating purchasers. Mr.Borgeson commented ML&P has been clear from the beginning of their non-participation. He hopes ML&P will vote in the affirmative for the financing. BPMC Minutes 12/6/17 Page 3 of 6 MOTION:Mr.!zzo made a motion to amend the 1%*Amendment to Attachment 1,Section C3.,the second sentence to read,"The results of the study undertaken pursuant to this Paragraph C.3.will be approved in accordance with the voting requirements for Optional Project Work.”Mr.Thibert seconded the motion. Mr.Izzo expressed the concern the affirmative vote of 80%would give non-participating parties the ability to control the acceptance of the study.Heis in favor of replacing the percentage to51%. Mr.Thibert urged ML&P to vote in favor of the motion to amend. < Mr.Warner asked if the original 80%numberis a BPMC requirement.Mr.Gibson informed the80%is not a requirement.Mr.Warner believes the change to 51%'Places the non-participantsatthemercyoftheparticipants._" Mr.Borgeson expressed objection to the motion.rafo A roll call was taken,and the motion to amend the 1*%*Amendment to Attachment 1, Section C3.,the second sentence to read,"The results of the study undertaken pursuanttothisParagraphC.3.will be approvedin accordance with the voting requirements forOptionalProjectWork.”passed,with GVEA and ML&P voting against.A roll call was taken,and the main motion to approvethe 24 Amendment to Resolution 2017-02 and approve the 1st Amendment to Attachment 1,as amendedin Section C.3.,passed,with GVEA voting agalnst and HEA abstaining as Chair:°Battle Creek Res 2017-03Attachmentto2017-03 o Res 2017-07 -$40M o Res 2017-08 -$1.2M ._ o-.Res 2017-09-$5.7M <>...o Loan Agreements "we MOTION:Mr.Foutz madea motion to approve the Battle Creek Resolution 2017-03, revision page numbered 867,Mr.Carey seconded the motion.Ms.Cartledge gave an overviewV of the minor changes to Resolution 2017-03,revision page numbered 867,provided today.On page two,three,and four the word "Committee,”will be maintained,and refers to the Bradley Lake Project Management Committee,and the words,"On behalf of the Power Purchasers and Authority”will be removed from all areas of the resolution. Ms.Cartledge reviewed the change on page three and four to remove the words,"In the best interest of the Power Purchasers.”The change on page three is to read,"The capital reserve fund enhances the marketability of the bond.”The next change is to include the phrase,"2017- 02,as amended on December 6,2017.”The misspelling of Bradley will be corrected. Mr.Borgeson requested an update from Mr.Eoff regarding the tax bill in Congress and the CREBS subsidy.Mr.Eoff informed the risk of sequestration to the CREBS subsidy program is still present.There have been no new developments since the discussion last week.The information will not be clear until the legislation in Congress is passed. BPMC Minutes 12/6/17 Page 4 of6 «x Mr.Borgeson expressed support for the changes to the resolution. Mr.Eoff reported an error in the 50-year calculation summary distributed to members,which resulted in an erroneous higher cost of power.The error will be corrected today. Ms.Cartledge gave an overview of the attachments to 2017-03 provided to members.The numbering of the attachments is for the purposes of AEA's supplemental resolutions. Mr.Borgeson encouraged AEA to continue efforts for provisions with CFC in the event of a reorganization or update to the purchasers of the project. A roll call was taken,and the motion to approve Battle Creek Resolution 2017-03, revision page numbered 867,passed,with GVEA voting against and HEA abstaining asChair.4 NOa<-NS * B.Executive Session to discuss Financing Terms.>. None.fos SO-:SS "C.Approval of Battle Creek Financing _Chair Janorschke requested utilities commit,for the record,and give notice to AEA of theirsharesoftheBattleCreekDiversionProject,plus any prorated and unallocated shares,to total 100%.CEA,MEA,HEA,and Seward provided verbal commitment of participation of respectivesharesandunallocatedsharestototal100%allocation of Battle Creek participation.ML&Pstatednon-participation.”GVEA declined to provide announcement,°.\hy &aAnyutilitywhodidnotverballycommitduringthismeetinghas until the end of today to providewrittennoticeofparticipationtoAEA's Ms.Applegate and Mr.Carey.Chair Janorschke requested Ms.'Higherprovide theBattle Creek Purchasers a timeline andexpectationsofthecertificationprocess.Mr..Gibson stated he will send,by the end of theweek,'each Battle Creek Purchaser a certification to be drawn up on utility letterhead,signed,and notarized..me a,7.COMMITTEE ASIGNMENTS None." Se 8.|MEMBERS COMMENTS Mr.Thibert expressed appreciation to the Finance Committee and all involved for an outstanding job. Mr.Izzo echoed Mr.Thibert's comments and added appreciation to AEA staff. Mr.Foutz expressed appreciation for the efforts to move the project forward.He reiterated discomfort with what transpierd early in the meeting. Mr.Carey expressed gratitude for all the work and support received on the financing. BPMC Minutes 12/6/17 Page 5 of 6 Chair Janorschke echoed prior remarks of appreciation and included the diligence of the legal participants. 9.NEXT MEETING DATE The next meeting is a scheduled teleconference on December 13,2017. 10.ADJOURNMENT There being no further business for the committee,the meeting adjourned at 12:37 p.m. BY:4 ;a Bradley Janorschke,Chair ' Attest: Bryan Carey Alaska Energy Authority,Secretary BPMC Minutes 12/6/17 Page 6 of 6 BPMC or IMC meeting availability \\aws\M5IMC Possible ML&P |GVEA CEA MEA AEA Board room dates (Kirk) 247 _"wren BNZOAL BPMC HEA ML&P CEA MEA Seward GVEA AEA rack Nee ae "Tony6Pes)Ow |oe [av-'2 e09 yl ed wnzo-[oe |aeieessstgeo(Cale |eer]21S)wee |oa oy"S12 hole "ik.Ave 2::4 "kh me,"mM las¥ es wi Zoe tt .Ok v