Board Members present: Sandra Bishop, Dorothy Anderson; Susie Smith, Peter Bartel, Patrick Lanning.

Others present: Randy Berggren, Dick Helgeson, Dick Varner, Jim Wiley, Dave Koski, Mel Damewood, Tom Buckhouse, JoAnn Andersen, Roseanna McArthur, Jim Maloney, Eric Hiaasen, Cathy Grey, Mat Northway, Scott Spettel, and Krista Hince of the EWEB staff; Kim Young, City of Eugene Minutes Recorder; and members of the public.

President Bishop called the work session of the Eugene Water & Electric Board (EWEB) to order.

1. 2001 Work Plan and Budget

General Manager Randy Berggren introduced the item, saying it was a continuation of the Board's budget discussion of September 20. He reminded the Board that staff had committed to a more detailed review of the budget. Tonight staff would provide a five-year overview of the water capital and electrical capital budgets. General Manager Randy Berggren said that staff would also discuss the water and steam utilities, with discussion of the remaining services scheduled for later work sessions.

Fiscal Services Supervisor Dick Varner overviewed the 2001-2005 Electric Utility Capital Plan, emphasizing significant expenditures over the planning period. Commissioners asked questions clarifying the information presented.

Water Engineering Manager Mel Damewood overviewed the Year 2001 Water Capital Budget.

Responding to a question from President Bishop, Mr. Damewood explained how the systems development charges (SDC) portion of a project was calculated. President Bishop said that staff should be clear about the formula it was using to be able to explain it to developers.

Commissioner Bartel asked if main replacements included a size increase. Mr. Damewood said that if there was a need and an opportunity for EWEB to increase the size of the main, it took advantage of that. The Fire Marshal determined the fire flow requirements. He clarified that the Fire Marshal was guided by the Fire Code. In in-fill situations, EWEB often found that there were insufficiently sized mains to support more recently adopted fire ratings. In response to a follow-up question from Commissioner Bartel, Mr. Damewood said that EWEB encountered insufficiently sized mains in the River Road/Santa Clara area and in areas formerly served by water districts. Dick Helgeson, Water & Steam Division Director, said that changes from lower to higher residential densities or commercial densities were other situations where EWEB encountered insufficiently sized mains.

Mr. Helgeson overviewed the Water Division budget. He showed the Board an organizational chart of the division, explaining that essentially staff levels were staying the same, although personnel costs were going up somewhat. He reviewed the division budget, noting that budgeting for water conservation was nearing the Board's target. Mr. Helgeson said that essentially, the budget was balanced, with a small increase in operations and maintenance projected over 2000 levels. He attributed that to an adjustment in labor rates caused by increases in pension and medical benefits

Responding to a question from Mr. Bartel, Mr. Helgeson described how staff measured progress in water conservation.

Mr. Helgeson briefly overviewed the steam capital budget. He suggested that the Commissioners consider contingencies for that facility in light of interest expressed through the downtown visioning and federal courthouse search processes.

Responding to a question from President Bishop regarding opportunities for co-generation, Mr. Helgeson said that there were economies of scale to consider, and staff would be looking more at that.

President Bishop thanked staff for the presentation.

The Board took a ten-minute break.

2. Tree Trimming Issues

The Board was joined by Jim Wiley, Electric Division Director, and Dave Koski, Electric Operations Manager, for the agenda item. Mr. Berggren noted an increase in tree trimming expenditures and said that given the serious nature of a citation EWEB recently received from the Public Utilities Commission (PUC), he thought it was important the Board hear more about the topic.

Mr. Wiley discussed EWEB's tree-trimming program, emphasizing the importance of tree trimming to uninterrupted power service delivery. He said that outages were caused frequently by downed trees, resulting in longer outages than those created by other sources.

Responding to a question from Commissioner Bartel, Mr. Wiley said that staff had not contrasted the cost of outages and the cost of the tree trimming program. Mr. Wiley said no. He did not think it would be difficult to produce that information. Commissioner Bartel noted his advocacy of undergrounding electric utility lines, which avoided altogether the problem of tree-trimming, and said that it would behoove EWEB to think about the total cost of the problem. Commissioner Bartel further noted City and community interest in undergrounding electric lines and pointed out that EWEB crews had even been threatened while trimming trees. He suggested EWEB consider why it did what it did. Mr. Wiley said that given technological advances, the life time of underground cable had increased and probably made more economic sense now than five or ten years previously.

President Bishop said she toured the Bonneville Power Administration (BPA) control center and had learned that trees were a major concern that the agency was very concerned about. The problem was compounded by the fact the agency could not control trees outside its own lands. BPA was beginning to send letters to landowners who allowed their trees to grow near or over BPA power lines and threatening to assess the cost of repairing downed lines to those landowners.

Mr. Wiley noted that overhead lines were not being installed now but still represented the majority of lines.

Mr. Wiley said that the agenda item was initiated by the PUC letter. He emphasized the PUC was not interested in levying fines but would do so if ignored. PUC's concerns were focused on public safety. Because of wet weather that spurred tree growth, EWEB had been losing ground in tree trimming and had hired another crew the previous year and proposed to contract with two more crews for a total of ten crews.

Mr. Wiley reviewed data from 1995 to 1999 regarding outage minutes caused by trees.

Responding to a question from Commissioner Bartel, Mr. Wiley explained that PUC staff physically inspected EWEB operations in Oregon communities. Enforcement action had stepped up because of deregulation and concerns that reinvestment in the system would be sacrificed to profits.

Vice President Anderson asked if staff had information on the number of fires caused by conflicts between trees and power wires in an average year. Mr. Wiley said that such incidents rarely occurred. He noted that the cost of containing fires in public State forests caused by power lines was the responsibility of the utility owning the involved line.

Commissioner Bartel asked about the impact from tree-trimming activities on other users of EWEB poles. Mr. Wiley said that the competition for space was at the communication level, farther down the pole. He noted that staff was currently discussing with the PUC whether EWEB could incorporate tree trimming costs into pole rental fees. Responding to a follow-up question from Vice President Anderson regarding tree trimming for communications companies, Mr. Wiley said that EWEB would trim trees to make sure the pole can be accessed.

Mr. Wiley said that the PUC wanted to see a comprehensive approach and staff was working to develop some public service messages related to lines and trees. The third-grade school energy program would be enhanced so that all participants would be exposed to the information. A forester would be hired to work with the trimming crews, work with the customers, and promote the Right Tree, Right Place Program.

Commissioner Lanning asked what education EWEB provided to customers about planting trees under power lines. Mr. Wiley said that there was educational information related to the placement of trees, and EWEB needed to be more aggressive with the local nurseries in promoting the Right Tree, Right Place Program, and in disseminating brochures. Mr. Berggren said that the forester would work with customers to replace trouble trees that were fast growers and caused frequent programs. Mr. Koski said that EWEB currently encourages the removal and replacement of trouble trees. Mr. Wiley thought it important to be proactive about planting the right trees now.

Commissioner Bartel hoped that EWEB's forester would be more knowledgeable than the City's, saying that the list of available street trees were often not suitable for location under power lines. He said that the forester should be able to tell people what trees do and do not work under power lines. He commended the tree trimming program as an important pro-active effort.

Vice President Anderson encouraged EWEB to coordinate its list of street trees with the list provided by the City of Eugene to residents. Commissioner Smith encouraged staff to share the list of trees with local nurseries.

Commissioner Lanning asked how much it cost to trim a tree. Mr. Wiley estimated that it cost approximately $100 to $150 per tree.

Commissioner Lanning suggested it easier to rescue improperly planted trees than to continue to trim them.

Responding to a question from President Bishop, Mr. Wiley indicated that the majority of tree trimming was done by crews under contract to EWEB.

The meeting adjourned at 7:35 p.m.

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Assistant Secretary President