HomeMy WebLinkAboutREFAC Minutes 1-14-2010_Verbatim 1
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Jan 14, 2010, REFAC MEETING VERBATIM START
1) Call to order. Chair Beltrami called the meeting back to order at 12:12 pm, Jan 14, 2010.
2) Roll Call: on phone:
Rep. Bill Thomas, Jay Livey (Sen Hoffman’s Office), Jodi Mitchell (Inside Passage Electric
Cooperative), Linda Hay (Sen Stedman’s Office), Kaycie (rep. Thomas office), and Brad
Reeve
Present in Board Room: AEA: Steve H, May Clark, Shauna Howell, Peter Crimp, Devany
Plentovich, Doug Ott, Audrey Alstrom, Butch White, Mike Harper, James Strandberg, Jim
Jenson, David Lockard.
Chris Rose (REAP), Jim Posey, Vince Beltrami, Mike Mitchell Dept of Law, Mike Nave
Dept of Law, Denali Daniels (Denali Comm).
VB: yesterday Chris asked to get a printout of all the recommendations for each of the projects and
peter sent that out this morning in a pdf about 62 light reading pages. We’ve made copies of them here
and I hope everybody on line has copies.
PC: I know people haven’t had much time to absorb these, so if you’d like to go slowly through them,
pick some for us to have a look at and get the comfort level that the recommendations are based on
good judgment ,etc.
VB: For Jodi’s and Jim’s benefit this is just the field in your database that gives brief comments on each
of the projects, we didnt’ feel there was necessarily enough info to understand the projects just by
looking at the spreadsheets. This is a short narrative on AEA comments in each of the project
applications.
Chris: The other question I had, yesterday, peter, can you tell us what the rough percentage of studies
was relative to construction?
PC: Yes. We sent out an email. We broke all the projects down by 3 phases: 1)
reconnaissance/feasibility, 2) final design /permitting and 3) construction. That should be in front of you
now, we emailed pDfs to all the members. We also sent out a revised regional summary, another
scenario that looks at what the impacts of geographic spreading would be if one assumes $50 million of
allocation.
Chris: I think the email you sent out about the 3 phases may have come out after I left my office. Is there
a printout. (gave him one).
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PC: Reviewed DEVELOPMENT breakdown: In the top 25 million (in the green): 76% construction, 8%
final design/permitting and 16% remaining for reconnaissance and feasibility. A notable factor is that
about 4% of the recon/feas is geothermal exploration or drilling. That is in our mind feasibility because
it’s resource assessment, but it is a physical activity that doesn’t get stale with time. That’s for Mt. Spurr
and Pilgrim Hot Springs.
In yellow; 46% construction, 18% final design/permitting and 36% recon/feas. For folks on the phone,
those are the columns all the way to the right on the large spreadsheet. I see Brad, Jodi & Rep Thomas
are on line at the go to meeting site. That shows the totals of the 3 categories of project development.
Cumulatively the comb of green/yellow, 61% construction, 13% permitting/final design; 26% recon/feas.
You pick up another geothermal drilling program. Of this total $6.6 of that would be geothermal drilling,
which would translate to somewhere around 13% of the total would be geothermal on site exploration.
(Combined green and yellow).
Chris; My understanding would be you’re not going to likely fund final design and permitting unless
we’re moving toward construction so in my mind I would kinda fit the final design/permitting closer to
the construction type of project. If you add those up total over the $50 mill, it’s 74% and 26% and of
that 26%, 13% is geothermal?
PC: Correct.
Chris: Half basically of recon/feas.
PC: Correct. So that gives that breakdown. If you continue further down in the spreadsheet, to the
ORANGE area..the further down you go, the less construction there is. 8% construction, 42%
permitting/final design (this is the last category for the remaining $11-12 million); 51% recon/feas. At
that point if you wanted to add the permitting/final design and construction you’re about 50/50. We
pick up another geothermal exploration project in Tenakee area. IPEC has proposed Tenakee Hot springs
exploration program of $2.6 million. A substantial portion of the remaining $11-$12 million is again
geothermal exploration. In total the geothermal exploration is around $9.2 million. We’re looking at a
fair allocation towards geothermal.
VB: Any questions or comments about that? (none). Thanks for doing that Peter.
PC: We can also look at the regional spreading if you’d like or would you like to spend some more time
looking at the detailed write-ups, just to drill down more and have a look at our logic on partial funding,
or not recommending, etc.
VB: Since we’re still on these sheets. I think we should discuss more the regional spreading, particularly
for those who weren’t here yesterday, give them the background on what you did there on the green,
yellow and how it’s encompassed.
PC: OK.
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SH: This green and yellow has nothing to do with the green and yellow on other pages.
PC: it does, actually..let me find it.
Chris: while you’re looking for that, answer a math question for me. When we put together this protocol
that said we would allocate on a cost of power basis we have 9 or 10 regions there, and they have
different cost of power, what’s the math to get from that cost per kwh in each region to the allocation
number.
PC: add up all of the costs of power and that gives you a funny number that doesn’t really mean
anything, it’s the proportion of that cost of power in that region to that phony number.
Chris: As applied to $50 million, or as applied to $25 million?
PC: As applied to whatever the total was that we’re allocating, in this case it’s $50 million.
VB: Yesterday, you only included the green for the first $25 million, so this is the adjustment that takes
into consideration adding the other $25m?
PC: Exactly. And I made a checkerboard pattern here to try and make that a little clearer. That should be
showing on the screen for the folks who are on the “Go to Meeting.” The spreadsheet we’re looking at
now.
(13:58) Jan 14 REFAC
PC: Let me explain again because some folks were not here yesterday.
Last time around, Rd1 and 2 we set up a protocol which says that we would look at the avg cost of
power, and allocate pro-rated to that, allocate the amount of funding by the relative magnitude of the
cost of power number and that each region should at least get 50% of that number. That came up in Rd
1 when Bristol Bay had very little funding going to it. We first established that rule then.
In Rd 2 what we decided to do was say that you could add, go further down on the list to reach projects
to bring them up to try to meet that additional funding needed to reach 50% constraint, but only use the
projects the dollars that were recommended that actually had projects for dollars recommended for
them. That is we wouldn’t go in and add funding for projects that weren’t recommended.
Posey: You’d just up the amounts for some of the projects that were approved and go further down
that list.
PC: right, In Rd 2 we did a fair amount of that and that’s reflected in the ranking submitted and
approved by Legislature.
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The blue highlighted areas in the 6th col over under ‘additional funding needed to reach 50%,” those are
the areas that are short. In allocating Rd 3 green and yellow funds, top $50 M, we’re still short and
Bering Straits, Bristol Bay, Kodiak, (blue highlighted), Lower Yukon Kuskokwim and North slope. We still
have some problems in getting to our cost of power allocation. That looks at Rd 3 by itself. A stand
alone. The bottom table looks at Rds 1 thru 3, again for the $50 M that’s not reproduced here. Bristol
Bay is short and NS is short. As expected we did get some smoothing in the allocations just by bringing in
more proposals.
Posey: When it comes to the NS, is that a lack of projects coming forward? It appears to be. It’s a lack of
things you can do and maybe a lack of I’m not sure.
PC : In Rd 1 there were no submittals at all.
Butch: Is the lowering in Bristol Bay impacted because you’re not using Rd 3 funds to, but rather pulling
those Rd 1 funds forward to do that particular project? Does that impact that number?
PC: I’m sure any dollars that are not allocated to Bristol Bay.
Butch; You really are because you’re bringing those Rd1 dollars in aren’t you. You’re not counting them
on that calculation, but you’re really applying the money over there.
PC: In Rd 1 there was a $4M allocation to the Lake Elva Hydro Project. A big one. That was the project
that was brought into the allocation by this rule, but if you look at the spreadsheet, there were not that
many successful Bristol Bay proposals this time around.
Chris; yesterday we looked at the 3 NS proposals that were recommended for $132,000 each I think, the
Recon studies for wind and we thought that if we added those which is all the remaining recommended
projects in the NS region they are still not going to get to the allocation, but we would have done our
best in recommending all the recommended projects in that region?
PC: Correct.
VB: And not exceeding the $25M because we’re actually under it.
Chris: right.
PC: right. I didn’t include those in here because I didn’t want to mess it up.
Jay Livey: Can I ask the same question that was just asked about the NS, for Bristol Bay. Bristol Bay
shows up at $1.7 million short, were there any other recommended projects that could have been
brought forward for BB?
PC: Refer to Orange section,
Chris: Are you talking about this current round Jay?
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There’s only one not in the green or yellow, that’s Port Alsworth.
Jay: What around Rds 1 and 2, are there any recommended projects there.
PC: I think they might be funded already. Pilot Pt I believe is funded in the yellow, and would be
allocated if we went to the $50M. New Stuyahok, I believe is too. __________ river is the same as the
Port Alsworth, right Doug? Right. The only one not included is BB fish waste assessment, that was
feasibility saying fish oil and fish waste in Naknek area processors for energy.
VB: Pt. Alsworth is only $150,000 it wouldn’t make much of a dent.
PC: those are within striking distance easily. There were a number of projects in Rds 1 and 2 that were
not recommended for funding. We can go thru those but AEA felt we had pretty good justification for
not recommending them.
Chris; The fish waste project was or was not recommended?
PC: Was recommended in yellow of Rd 2.
VB: so that’s really the only one that’s kind of escaping this situation now. If we remain with the protocol
and only bring in Rd 3 projects and not go backward in time.
Jay Livey: If we look at Rds 1 thru 3, as a way of smoothing out the allocations, then some ways its
logical to use projects 1 thru 3 to bring up an allocation that needed to be raised as opposed to just
looking at Rd 3 allocations?
PC: Would that mean we would want to look at the fish waste project?
Jay: Just throwing that out for discussion. It seems inconsistent on the one hand to use Rds 1 thru 3 for
the cumulative percentage but then only use Rd 3 projects in order to balance that out.
Chris: I see the logic in that, I’m wondering how much that fish waste project was for and also if there
were any recommended projects that didn’t get funded in NS in Rd 2. If we did that for BB region, we’d
probably have to do it for the NS.
SH: they also made a choice not to take the Rd 2 apps over to Rd 3.
VB: they’d have to roll them up to Rd 3 if they wanted them to be considered.
PC: All of the NS projects were funded.
Posey: We did very well balance wise. The ratio to urban to rural is still maintained. I don’t think that’s a
bad way of spending the money taking into consideration the diverse pieces that we have in the state
when you start looking at population numbers and everything else. You can say some regions are over
represented, but that’s also where the high costs are. Roughly, I don’t think you get to smooth it out
any more than you have here without doing damage to some of the concepts we are trying to stick with.
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VB: In going forward, knowing that in future rounds people could come back and ..there was just a lack
of projects was the main reason that we didn’t get up to the number that would have justified the
averaging there. Going forward some of those projects can be resubmitted or get more. Going back
into Rd 1 and 2 proposals doesn’t seem like necessarily what we want to do.
VB: This isn’t the last round. The Commitment was for 5 years for $300M. We’re not anywhere near
that. Initially it was 5 yrs for $50 million a year and then we got the $100 in the first year so it
immediately made it look like $300.
Posey: The original commitment was $250+, a long way from where we started. I still maintain, given
what’s happening in the Lower 48, without any federal dollars being involved in the allocation process,
we’re doing better than most other states which funded this differentially and they’re still looking at
doing it on the backs of the folks who are paying high costs in other words you pay high costs per kw in
order to fund some of these programs, even in places as diverse as Germany and France.
(28:03) This is a step above other governmental jurisdictions as to how it’s being funded and the amount
that’s going out that doesn’t necessarily require a lot of local matching which we start off from the
beginning, saying if you don’t have boots you can’t pull yourself up by your bootstraps.
Chris; I guess this brings up the issue I raised yesterday about maybe developing a written set of
protocols so that we can start putting these together and it’s really clear to us as to the methodology
that we’re using so that if we are going to smooth things out, we’re going to do it cumulatively, this and
that, let’s just write that stuff down so it’s clear.
VB: Chris was talking about the narrative to legislators pretty much encompasses all that.
Posey: It will be hard for me and others to explain to the Legis what we did if the narrative isn’t there
and as to why, but it’s been a rational process and I think it’s worked fairly good. And for some of the
naysayers who didn’t exactly vote for it or vote for the first round to go forward ..there are no piglets in
this, they’ve been smoked out , eaten up.
VB: Any comments, questions, observations on the spreading?
Posey: Rep Thomas how do you feel about the process so far and the ballots that’s being shown
especially when you look at Rds 1 thru 3. I’m interested in your piece because you and I had to twist
some arms down there to make sure this was going forward.
Rep Thomas: I’m happy where we’re at. I guess people didn’t believe that was going to happen so they
didn’t put any projects forward. I’m happy with what we’re doing and continue to go forward. To get
the legislators to add projects including BB, NS get them to get the finance committee to address it, they
didn’t care, we need to get the people who live in those districts to let them know that these are
important to them. I had a hard time to get at least 3 to wake up and come along and sing with me. I
think we’ll do fine if they will listen. They have other agendas. This is already money in the pocket so it’s
not a big thing, but last year was kinda of ..we’re doing fine. We’ve come a long way.
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Chris: I wanted to add to what you were saying as to how much we should ask for as a Committee.
Obviously the governor has sent implicit instructions to AEA that it’s $25M, thru the number in the
budget but yet the Legis said $50M and we’ve got a spreadsheet that shows how we could do it both
ways, but I wanted to know from the Committee’s standpoint as to what message we should be sending
to the Legis. I personally would like to say there’s $50M for the projects and give them the whole list and
explain how we’ve broken it out so they can clearly take the first $25M if that’s all we get, but I think the
Committee should start out by asking for $50M.
Rep. Thomas: I agree. I always tell people if you come in for $25M, you can get $15M. This is the year we
have money and it’s an election year so people will be taking care of people. The higher the better. I
don’t think the Governor controls this board. We can recommend $50M in keeping in tune with the
legislation and go forward and say we want to match it.
VB: Any other members have idea or thoughts on that?
Rep. Thomas: If you want, I can make that motion.
VB: I’ll entertain any motion.
Rep. Thomas: I make the motion we submit up to $50M. Seconded by Chris Rose.
VB: So moved and seconded. Any further discussion?
Posey: Should it be an even fifth. If we’re not going to get to the 50 let’s just amend the motion to put
the number in there….
Rep. Thomas: Make it a 50 solid, that’s fine. I think it will come in between, but that’s fine. I can live with
that. Let’s request $50M in projects.
Jodi: I was just agreeing.
Chris: If we have this motion now, is that the only motion that we need to carry forward out of this
committee and if so is everyone comfortable with all the projects. What I think the motion is saying is
here’s the first $50M for the projects, we agree with AEA’s scores and ranking, here they are.
VB: That’s exactly what we’re saying.
Chris; Me too. There was this question earlier on the table about had people had enough time to look
through the list. I feel comfortable, I’ve had time to look through most of them. I’m fine. I just wanted to
bring that up for that reason.
Rep. Thomas: I have all confidence in AEA after working with them for a couple of years. That will be the
argument between Sen. Hoffman and myself, is that you have confidence in the people around you and
that’s what we have to keep saying .
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PC: Question, would you like us to adding the NS and BB projects in order to use our ranking, that may
cause us if we had those in I haven’t done the math, we’ll go over $50 a little bit. Should we knock back
on the lowest ranked project in the yellow in order to do that?
Chris; NO I think we just ask for all three, wind recon projects in NS, BB Port Alsworth. If it goes over
$50M that’s the number we submit. $50,323,000 whatever it is.
VB: You’re amending the motion to go up a little bit and …
Chris: Amending the motion to include those four projects , three from NS one from BB and submit the
number that that adds up to? 436 – Port Alsworth and 412 Pt. Lay. That’s it for NS.
VB: Any opposition from the maker of the original motion?
Thomas: None.
VB: That’s just two more projects then, one from each.
PC: It’s still a little over. We came really close.
Vote on motion: VB: Any other discussion on the motion, hearing none, all those in favor say aye.
Motion carries with no opposition.
Chris: I’d like to finalize business I brought up yesterday, that there will be a narrative written by AEA
that describes how the program has developed, what the rationale has been in figuring out how we’re
going to score the projects and do the geo spreading and that the question I have is who is going to be
transmitting that information. Is there going to be an official letter from you Steve (H), along with the
pie chart we looked at and the spreadsheet. How should we communicate that information is the
question.
PC: We’ve already agreed the narrative should be written and Butch W has already started working on
it.
SH: He has, there’s different levels of information we want to share, the pie chart is one snapshot of
some information. The picture method is very good. The spreadsheets works very well but may not get a
very good audience, so we need to find the best method to share that. We’ll be working on that. The
question I’d like to ask is, “Do you want to come down as advisory committee members and support the
effort?”
VB: Absolutely. I’ll be there next week.
SH: Last year we wrote a letter and gave them the list & mailed it down to them and just said there it is.
That’s all we did. We did not do any hearings at all on the list. There was nothing. We made up for it
going to LB&A a couple of times.
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Chris: I’m just saying it’s not a bad idea to be a bit proactive especially with certain people who may
have still concerns. I want to get consensus among the group on that’s ok and we’re all bringing the
same message.
PC: I can see this as a package but I would like to have a fair amount of time to get a good presentation
together for the existing projects which I think to have the technical progress on those projects pretty
well nailed down, pictures, numbers, that sort of thing. I’m not sure if that should come separately but it
would be the coordination of the 2 messages: this is what we’re proposing and this is what we’ve done.
Chris: I’m wondering if the Committee should be writing this narrative, or having a narrative going to the
legislators just so that everybody’s on board with it. Just a brief snapshot of what we’ve done, what our
process has been, here we’ve been working over the last so many months, we’ve his this many
meetings, the decisions we’ve come up with in collaboration with AEA, and their scoring system.
VB: That’s a good idea, essentially it’s signed off, we could all sign it, but I think it would be great if you
guys would draft it. Send it around to us to be reviewed and comment on. I’m sure you’ll want to see it
before it’s finalized.
Chris: Sure that’s just a bit different message than the technical message that I think is important that
Peter’s talking about. That doesn’t have to be done right now. But if we go down there next week the
people will immediately begin asking questions about this program and we want to have answers
immediately. They’re generic questions, like what’s the process, how’d you come up with that, etc. Not
specifically which projects and why which projects.
Sara: Butch already has a draft going. I just started looking at it making some notes on some things to
add to it. The narrative can be written to have Committee support, whether Steve signs it as Executive
Director, or not. Obviously from the conversation yesterday as you pointed out there’s a lot of people
who need to know more about the details of the program – we need to tell that story, it’s a good story
to tell and the fact that you guys are working as part of this is very helpful to be able to help carry the
message in supporting the process and methodology. You can almost send two message. If there’s
some kind of overview and a finance committee having a couple of you there to testify and support like
you did in LB&A and some other hearings is very helpful.
Rep. Thomas: Re the report, I talked to Dick ____ today and he told me before he flipped the switch to
turn his hydro on, they were paying 58 cents per kw and today they’re paying 30 cents per kw, before
pce and the people who are not on pce at 30 cents are celebrating, they’re saving 28 cents per kw . This
is a poster child we have sitting down here and we can always say look at what that does is to look at
the 28 cents in kw savings in pce that will help other communities. We’re saving pce funds also. Maybe
we can draft that in there.
Chris: To circle back on who’s going to sign this letter. I think maybe it makes sense to have both Steve
and Vince sign it or do people think it would be better to have two separate but nearly identical
messages?
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Posey; two messages not good, and a good technical report is really what we need to sell it in order to
keep it on track. The real battle will come towards the end of the session – is it between $25M or $50M.
Chris: Ok, so do people feel comfortable with Steve and Vince signing this letter?
Yes…. Steve has to sign it anyway.
SH; the next question to ask is are they going to have hearings on this, and if they have hearings, if the
finance committee, do you want to bring recipients down to testify about their projects? Like LB&A did.
That one time they asked questions about taxes and there was 5 people in the back, talking about five
projects, they brought them off the front and let them, that’s more of a political question on how much,
support – that’s the local support Bill (Thomas) was talking about earlier, bringing down the recipients to
testify on behalf of their projects. That’s something we have to coordinate if they’re going to do it.
Chris: Good idea, if we did that we don’t necessarily want to just cherry pick the best projects, like
Kodiak Electric, etc. we also want to have somebody there saying how important it is for someone to do
a reconnaissance study, have a little mixture of types of projects that got picked. A good idea and to get
ready to start figuring out who those people might be now so they’re waiting in the wings.
Posey; Did we get a number that compared us with AFHC as to how our spend is versus theirs.
SH: it’s in the handout made yesterday. We can talk about it.
(discussed it) “AHFC Report on Energy & Weatherization Programs”
That was an existing program, ours is brand new. Posey: Comparisons should be made. There will be
contractor problems about being paid.
SH: Yesterday we talked about the caps and went thru the list and named projects that were becoming
stale & not moving forward, most are going forward, except maybe one or two that weren’t going
forward of the capped programs. Even tho they’re not moving today, they still intend to go forward.
Posey: Does that include Anc Landfill, is that considered moving forward.
PC: We talked about landfill gas – our new biomass program manager, Devany Plentovich , is working
with Seldway? Services and the Muni and we’ll extend that grant understanding they had to go through
a longer period to allocate the funds.
Chris: We talked about that being part of the narrative, just a little bit about …
Posey: the reason I bring it up because we have to deal with the urban/rural split and some of the urban
guys are still not comfortable about all the money going to rural and this project will be brought up as
just one of the ones that has potential. We’re not the hold up. It’s the city’s process is.
VB: do we have anything else.
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PUBLIC COMMENTS:
Kim: Mr. Chairman, I had a question as a member of the public.
VB: OK, and you are?
(54:16)
Kim: I’m Kim Bromeny (sp?), and I’m interested to, I’m a volunteer in certain organizations around town
I have a question as to what you were just talking about. I have heard rumorsand they’re just rumors, I
heard that AEA is slow in allocating funds and actually getting the money were they need to be so
certain projects can’t get started. Will you be developing an official way of monitoring it, I want to start
by saying thanks for the work you’re doing there’s lots of projects . Do you have a way of monitoring
round s1 and round 2 where the administrative process is , are things moving or are these rumors of
micromanaging and money not going out…
VB: they are rumors. We’ve actually had discussion about that, I’ll let Steve take that.
SH; They may not be rumors. As you go forward, I’m on the record as saying zero failures. If you just
want to get the money out the door, we can get the money out the door fast, that’s not the problem,
but we’re trying to do it responsibly and we’re being held accountable for the results. If someone says
just give me the money we explain that it’s a grant reimbursement program, not just a grant program.
As you spend the money we reimburse it. The first part of the bottleneck we bumped into was the
grant writing itself. The milestones and understanding what milestone you have to hit. We’re pretty
much though that. The grant process is moving along fairly well. This is our second year in the program
and we now have a standard grants we start with. Last year we hit a few bumps. Once you get the
grant in it turns into monitoring to make sure we can get the stuff done. We’re making sure we’re
putting money into good projects. The other rumor I’ve heard is we’re being too aggressive on
reviewing receipts, as a public agency we have to look at every receipt that comes through, we’re being
fairly restrictive on where the money’s spent to make sure it’s there for the proper purpose. Are we
being a little bureaucratic? I think the answer is yes. That’s just the way the state set it up because if
you have any kind of issue, any legislator can reach out and grab one example and pull it up and go aha
look at this. They can smear the whole program. So we’re being a little conservative on our approach so
we don’t want to have the one example pop up, but to do that you also take a little bit more time. I’m
not going to say we’re liked greased lightening because I don’t think we are, but I don’t think you want
us to be either.
Sara: We have to pay invoices in 30 days and I can say my experience, I used to work in finance. Finance
typically pays any invoice whether it’s a grant invoice or any other invoice in probably two weeks at
receipt of it. Even if it’s a complicated invoice, the team works very well as far as getting them
reviewed. Grantees have the responsibility to make sure that reporting…they have to report on a
project. Typically it comes in when they submit an invoice. There is a process that goes on. If there’s a
delay where we’re not paying an invoice w/in 30 days, which is very rare. It’s probably with respect to
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missing some of the pieces of the paperwork on what’s the progress of the project, making sure a
milestone has been met and making sure there’s adequate documentation and support. Typically what
we do if we have a large invoice that has some questioned cost, we’ll pay up to the cost of the
questioned cost and at least get out most of the money right away, withholding the money and allowing
them to provide additional information. We won’t hold up the entire invoice on that. I think if there is
some concern about not getting paid on time, there’s also often times contractors…we’re not paying
contractors directly in this program, at least for the most part. We are paying the Grantee. The
Grantee is responsible for paying those contractors. There’s probably another side to the story with
respect to the process on perhaps why someone has felt like they haven’t gotten paid in time.
PC: to give you a more concrete example, when we set up milestones say for a construction project,
we’ll say, well before the construction funds can be released, you have to show us that you have the
permits that are done. The last thing we want to do is make a reimbursement for a million dollar wind
turbine when the project is going to go sideways because FAA or the Fish & Wildlife Service says no go.
We have to use our judgment to say well I think that permit’s going to be there. We have not gotten a
faxed copy of the permit, but on the other hand if they don’t get this on the barge by next Tuesday,
they’re missing a month of construction. We’re faced with those kinds of nitty gritty decisions that we
need to make. It’s a bit of a tradeoff and we have to use our judgment. As Steve said, we need to be
conservative sometimes, especially in this first year when we didn’t want to have failures, we needed to
err on the side of conservatism.
Kim: It’s a reimbursement program. So what happens when a small village doesn’t have their own funds
to pay for it..they have to go in the red.
PC: We have the ability to make advanced payments. Generally we’re setting our milestones and
milestones in a grant will say for example, grant signed, they can invoice us for $100,000 just to get
moving on the project. That’s one way to do an advancement. The other way is just on the fly..and Sara
can probably tell you a little more about that.
SH: Actually the dilemma we had was, actually a wind turbine person who said oh I need, he had not had
the permit in his hand and he said but I need the advance, I need to get this turbine delivered so we
looked at that and said we will advance you the money, it was restrictive, but you’d have to pay it back
to us if you don’t make the next milestone. Once you clear the next milestone, then we’re ok. Two or
three people that did that, one was Unalakleet, they said we’re good and the other one was actually in
Delta, I believe, and they both made the hurdle, the next milestone. It was an issue but we just didn’t
want to give them a $200K advance and then have nothing happen. When you get these $2-$4 million
grants, you can send a lot of money out the door just to buy the materials. We’re trying to make it
work but we’re trying to make sure we’re ok with the state process also and not just throw money out
the door and get pegged for it.
13
Posey: Good question for staff is to emphasize why it’s so important to have no failures is that before we
made the first presentation to the legislature on the first round of money, how many people showed up
here to do an audit.
AEA: this room was full, legislative auditors were here for a week.
Posey: Just to let you know why , there was a group that came in even before they were delivered, they
wanted to know about the process, there were so many people in these two rooms I couldn’t get in.
They were all from down there.
VB: The three of us are board members. There’s 4 other board members on the phone and we’re all
independently appointed by the governor and working with the Agency. A number of us have expressed
the same kind of concerns all along. All of us members would say they have been pretty satisfied with
AEA’s resolution of every issue that’s been brought up. We will all stand behind the process we’ve
developed over the last year.
Chris: I’ve fielded similar complaints from the public and just transmitted them to Steve and said what
about this and Steve has given the same answers he just gave us here, which is we’re following the
process. As board members we’re still trying to be transparent about what we’re hearing so we’re all
moving forward together.
SH: If you have any complaints like that, you have them call me. We’ll look at it and see if we’re being
unrealistic or unreasonable. We put together the advancing for winter, but that’s not anywhere in our
process we had to come up with that on the fly. That was a creative solution to a real problem. We’re
willing to work with them.
Chris: should we get another meeting date while we’re mostly together. We may not need that meeting
date, but it would be better to set it now. The possibility of having a meeting in Juneau was discussed.
Committee meeting or just get down and get message out. Bill T No committee meeting. Many will be
down there next week anyway.
Next meeting will be at the call of the Chair.
VB: Thanks for all the hard work. Denali appreciates the work that PC has done w/Denali Comm.
Bill T: will send the floor schedule to Peter and he will give it to Steve.
Meeting adjourned at 1:25 pm.
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