[This transcript was generated automatically from audio using AI and hasn't been reviewed by a person -- it can contain mistakes, including plausible-sounding sentences that were never actually said. Treat it as a starting point, not a verbatim record.]

[0:37] Good morning, everyone. Welcome to the December board meeting here at Perdinal Selector Cooperatives. It's a great month as we have Christmas and New Year's and hopefully some time spent together with friends and family. So we're glad you could take a few minutes to be here with us. Ms. Garbo, will you please call the roll?
[0:56] Milton Reister.
[0:59] Emily Pataki, President, Mark Eckrad. Here. Travis Cox. Here. James Oakley. Here. Paul Graf. Here. Amy Acres. Present.
[1:09] We have all directors present, this meeting is officially called to order.
[1:13] We have had the agenda posted, and if there are no objections, we will adopt it as it
[1:18] has been posted.
[1:21] Under our consent items today, we have our regular meeting minutes from our Friday, November
[1:26] 20th Board Meeting here at PEC.
[1:27] Those have also been available for your approval, if there are no objections, we will approve
[1:32] those under consent.
[1:34] First up today, we have our cooperative reports starting off with our cooperative update
[1:39] from our CEO Ms. Julie Parsley looking lovely as ever helps
[1:48] the loveliness of course
[1:58] thank you
[1:59] directors this is great is our last board meeting of 2020 2020 can go away now and hopefully 2021
[2:09] will be much better and if I could make it I would but this has been an unusual and difficult year
[2:23] But I'm very happy to say that the cooperative and its employees have done an incredible
[2:27] job for our members, and we're very proud of them.
[2:32] Believe it or not, this is the ninth board meeting I've opened with this slide or something
[2:38] like it, because it's been that long since we've had COVID with us.
[2:42] My hope is that we can retire this slide sometime next year, hopefully the sooner the better.
[2:48] but we are still managing very well under these circumstances. We do still have some remote working employees and everybody's doing a great job.
[3:00] And I would like to say too that we have defied the trends, the COVID trends at the co-op. We have not had the same kind of outbreaks that have been in other places.
[3:09] And I'm very proud of everyone for that effort and really following the protocols, setting the right protocols.
[3:19] So we also supported our members during this time, it's important to say that even though
[3:24] we suspended our disconnects and late fees and returned out of posits, it's important
[3:29] to say that no one made us do that.
[3:31] We are not regulated by the Public Utility Commission and there was no order in the state of Texas
[3:36] requiring us to do that.
[3:37] That was a choice the board made and it was a great thing to do for our benefit of our members.
[3:42] And I just want to thank you all for that for taking those steps because it was a big
[3:48] help for a lot of people who were struggling.
[3:51] We also still collected our funds from our members, our employees, and our Central Texas
[3:55] communities.
[3:56] We're still returning those to our members that are in need.
[4:00] And those assistance programs have been very effective.
[4:04] And one of the things we're really proud of is the 4,000 masks that we collected for
[4:08] the masks from members' donations that we've been able to distribute.
[4:13] We also engaged our employees during this time.
[4:17] We started an on-the-spot recognition program,
[4:19] and I think I told you about a few months ago,
[4:20] but I don't know.
[4:21] I think that what an amazing employee you are
[4:23] is just makes me smile.
[4:24] It's just the WOT award.
[4:27] We hand out the on-the-spot awards,
[4:29] and when there is a little magnet,
[4:31] so if somebody can put it on their locker or on their desk,
[4:34] and then quarterly, we do a drawing for an award.
[4:38] And so if you get a WOT for that quarter,
[4:40] you get to enter your name,
[4:42] and you get an award. So it's been very successful. People seem to really like it and it's just been,
[4:48] it's a nice way to get to recognize on the spot above and beyond behavior, so it's been great.
[4:54] So we've done a lot of different things to engage our employees.
[4:56] Another thing that I really like that we've been able to do.
[5:00] So, what we do is designate them as essential workers. We've started putting that on the uniform of our electrically qualified employees that can't wear metal. And then we have badges, metal badges, like our little Texas with PEC on them. This is essential worker and our logo for non-electrally qualified employees. And I think that's a really good reminder to them and to our members what we do for them every day, and how we really do keep the power on them.
[5:30] and it's a very essential thing for the way you're able to do.
[5:34] Through this time we've actually grown stronger.
[5:37] I can't believe it, but even though 2020 was the way it is,
[5:41] we're going to have another record year.
[5:43] We are going to add almost 18, well, 17,600 meters by the end of the year
[5:48] is our estimate.
[5:50] I checked Smart Hub yesterday and we're at 347,500 meters.
[5:57] It's just been crazy.
[5:59] And just so you can see the growth since 2015, you can see that 2020 is again the fastest growing, fastest past year we've had.
[6:09] So even though we've had hurdles to overcome, they've been overcome because we have been doing the work every day.
[6:18] And all I can do is say we've got an incredible employee base that's able to do that.
[6:24] Also, we've been trying to build the next generation.
[6:26] This has been a focus for us for several years,
[6:28] but this year we were able to open our new training facility
[6:31] that we put together in conjunction
[6:33] with the Northwest Lyman's College in Marble Falls.
[6:36] And we've had our first apprentice program going through
[6:39] and it's been a tremendous success.
[6:41] We're very proud of this.
[6:43] We're also going to be doing different kinds of training there
[6:46] and we're going to start with that too.
[6:48] I think we're doing tagging and switching,
[6:50] we're doing some tagging and switching training there.
[6:53] We're looking at doing some different classes as well
[6:55] in addition to the apprentice training.
[6:57] So it's a great facility for us to be able to do hands-on
[7:00] training for people when they need that additional training.
[7:07] We've also been planning, you know,
[7:08] we really are committed to physical responsibility
[7:11] and this you were able to lower our rates
[7:13] and our costs to benefit our membership.
[7:17] We maintained our AA-FIT training,
[7:20] which is an exceptionally high bond rating.
[7:22] It allows us to get debt at lower rates
[7:25] than if it was a higher bond rating.
[7:28] And so it's a very beneficial thing
[7:29] to both the co-op and our membership
[7:31] in terms of the rates that they pay.
[7:33] We returned $6.1 million in capital credits.
[7:37] And we have, with our new CFO, Randy Krueger,
[7:41] he, we have reviewed and revised
[7:42] our substantive financial policies
[7:44] and we better aligned and improved our cash flow.
[7:47] We've also undertaken a debt restructuring and that's very, it's been very beneficial.
[7:54] This year, despite COVID, we were able to make a rate reduction that equals $6.5 million
[7:59] of annual savings to our members. That is something that I think we may be very unique in doing.
[8:05] There are other utilities and municipal own utilities and others that have announced
[8:11] great increases. So we're very proud that we were able to manage this, that we were able to get
[8:16] that for our members. Do that for our members. We've also engaged in some smart conservation efforts.
[8:22] We deployed our battery. It's the first ever for a Texas cooperative. It is operational now.
[8:28] And David can give you an update on that as well. But it's a great thing. And it's working just
[8:35] exactly as we had hoped. We're putting power into the ERCOT market when they dispatch us. So
[8:41] It's working out.
[8:42] We also secured 100 megawatts for the Creek 1-1 project.
[8:47] We've distributed a ton of seeds for wildflowers
[8:50] around the service territory.
[8:52] That's been a big hit with our members, schools, churches.
[8:57] We've been able to really reach out to people
[8:59] with those seeds, and they've been very excited about it.
[9:02] And our edible easement programs where we started trimming
[9:05] our rights of way and putting in vegetation
[9:08] that can be graced by the wildlife.
[9:10] and also utilized by the pollinators, so it saves us some money in terms of having to clean clear rights of way.
[9:19] We're also exceeding expectations, keeping our rates low, and increasing our services to members.
[9:27] We've really raised the borrow for reliability.
[9:30] This is something we're very proud of.
[9:32] We've finished all of our switch installations and our substations.
[9:35] We've upgraded our substations.
[9:37] We've pruned 317 miles of line.
[9:40] We have, uh, inspected nearly three times as many lines of miles of line in 2020 with our
[9:47] drone program then before.
[9:49] So we have done a great deal, our employees have done a great deal to ensure our reliability
[9:54] which is really paid off because we are at a historically low SATI.
[10:00] 39.6 minutes for training on the rolling annual average. So, congratulations to everyone for that. That's a lot to be proud of. And it is, again, a historical low.
[10:17] We've elevated our service as well. We're thinking like members, and we're working to get that trademarked, actually, because it has been such a successful campaign. So, we've also increased our services throughout this.
[10:31] We redesigned our bill so that our members could have more information, we've expanded
[10:35] our residential rate, our residential rate.
[10:39] Energy audits, we performed 81% of our energy audits this year after COVID struck, and
[10:45] member relations successfully adjusted to phone and virtual audits to keep our program popular
[10:51] in spite of the social distancing, so we're very proud of that.
[10:53] We also launched a commercial.pec.coop website, which is a site for targeting our new large
[11:01] power members that David and his group put together for us.
[11:06] And speaking of websites, we also put together a website for our new members, which we have
[11:12] many this year.
[11:14] We just keep coming in.
[11:17] And this puts all the things that they need at their fingertips in one site.
[11:22] We've also answered the call this year.
[11:26] Co-op-wide, we've had over 16,000 virtual training sessions by our employees that were
[11:31] taken in 2020, which is a lot to be proud of because there is a portion of that that
[11:36] aren't just required trainings that we want them to take.
[11:38] They are also professional trainings in order to help further people's careers, their goals,
[11:44] help them, managers communicate with their employees that are remote.
[11:50] We've done a lot of different things this year to try to help get those resources to our employees and they have taken advantage of it so we're very I'm very happy about that.
[11:59] We've also proactively worked with our members to create more than 13,000 payment arrangements, which is great for our members and the co up co up.
[12:09] Another thing that came into being because of requirements for social distancing was our empower you university.
[12:17] So, Les Mkoska did this along with communications and it supports our commitment to provide STEM
[12:24] opportunities for students in the schools.
[12:27] We have video series, we have lessons plans, we have worksheaks and activity books.
[12:31] And when we launched this on October 1st, in the first six weeks the program received more
[12:35] than 2,000 hits on our website.
[12:38] So, it seems to be very successful and provides teachers and homeschooling parents also with
[12:45] an ability to have some new lesson plans and some interesting safety and STEM tips.
[12:52] We've continued to build our communities throughout this.
[12:55] We've supported our youth with our $100,000 in scholarships that we were able to give.
[13:02] We also gave $50,000 to 11 nonprofits, which were fully funded by the power of change contributions.
[13:09] So we've been able to do that despite the fact that our youth tour was canceled because
[13:12] as a pandemic and some other things had to be virtual.
[13:15] We still managed to do that.
[13:18] And we've given back to our communities.
[13:19] The United Charities gave $265,000 to 236 nonprofits.
[13:25] These are some of the nonprofits that they gave to our employees,
[13:28] donated $17,000 to assist members in need.
[13:32] And they also gave a Christmas time, $4,300
[13:34] to help brighten the holidays for local children.
[13:37] Like we said last month, we usually do a toy drive
[13:40] that weren't able to do that.
[13:41] So, we did get this amount of contributions from our employees, which is extremely generous.
[13:48] And even though it was a challenging year, we had a lot to celebrate.
[13:52] We are, as I've talked about for the last three months, I'm proud I am about this.
[13:56] But it really is a very thrilling award to be able to be noted as a top workplace.
[14:01] In both San Antonio and Austin, it is the first time we've ever received this reward.
[14:06] And now everybody knows what we know that our employees are rock stars because that's really what that means.
[14:17] and they have to go to the top.
[14:21] We also received a new award this month.
[14:24] Our Community Relations Group received the Greater Austin Business Award for Community Relations.
[14:30] And the Chamber highlighted the cooperative's ongoing commitment to building stronger communities
[14:35] through our charitable, giving, volunteer, and youth programs.
[14:39] So we're very proud of them for this.
[14:41] That's very impressive, especially given the pandemic, that they were able to still make a difference
[14:46] in our communities and provide for our members in the ways that they have.
[14:49] It's very proud of Mike and his group, Diana, Sharon, and Flust.
[14:56] And the Caroline, how can I create Caroline?
[15:01] We also were named among the National Cooperative Banks Top 100 co-ops. We received the Texas CEO
[15:07] recognition, magazine recognition, and in our ACA spotlight, we received a silver award on
[15:15] the spotlight of excellence for our anatomy of a utility poll, which is that really cool
[15:20] drawing that DN did, DN roasted.
[15:25] And I've talked to you a lot about the kudos that our employees
[15:29] have received. These are all four-star employees. These are employees that have received four
[15:33] cutos over the last six months. We're very proud of them. Enrique, Michelle, John, and Alexandra.
[15:41] So I wanted to point them out because they really are four-star employees, which is great. Keep up
[15:45] the great work, everyone. We're very proud. Instead of looking forward to 2021, we're looking at
[15:51] doing different things in the legislative session. We're going to continue system upgrades for
[15:55] increased reliability. We have more employee recognition
[15:58] program and incentives on the way. And we're going to be
[16:01] evaluating our workplace and evaluating our spaces for remote
[16:06] working. That's going to be an important thing for this next
[16:08] year. And last but not least is with sadness that I announced
[16:15] that LaWanda Parnell, our CIO, is retiring. She has made innumerable
[16:20] contributions to PEC in the eight years she's been here. And
[16:25] I hope you would gel me in a round of applause for LaWanda.
[16:35] We're going to miss her.
[16:35] I'm not 100% sure she's going to miss us that much
[16:38] because she's going to be fishing a lot, I believe.
[16:44] So, Dr. Oakley.
[16:46] Yeah, I just wanted to be in a bit of a number of crunchier
[16:50] on the average monthly count growth of 1529.
[16:54] If you do the math based on a 20 day work month,
[16:57] I'd take out the weekends and that puts you
[17:01] We get 76 new meters a day and I remember it's about two or three years ago that number was 53 and so that's a 44% increase in new growth and so didn't you factor in the multiplier on residential meters on how many people live on that meter, if you will, I can't remember with the for some reason 2.7 rings in my head on the average number per residential meter.
[17:24] That's a lot of new family members.
[17:26] It is a lot of things.
[17:28] It's an incredible growth.
[17:31] I remember when that number was actually
[17:34] in the mid-40s back in the day.
[17:37] She's really growing.
[17:39] So it's just something to recognize.
[17:41] And managing that growth is something
[17:43] the job excelled in doing.
[17:47] It's been incredible.
[17:49] And our employees are that out in the field
[17:53] have just done an incredible job.
[17:55] I really have Director Graph.
[17:58] I'm not sure what I can say except wow what a year you know and I look at the executives executives call it all kind of have this element of pride about them and you ought to because I tell you what this doesn't happen without exceptional leadership.
[18:12] Thanks to you guys executives and also thanks to all the employees to make this happen this is this is a banner year for sure.
[18:21] Thank you.
[18:22] Thank you. Well, thank y'all very much. And thank you for your leadership. It couldn't happen without y'all.
[18:26] What a great year, especially in the midst of, like you said, what we, what everyone has been facing with the pandemic and you have really risen.
[18:34] Of what we expected. So that's a great, um, kudos to your leadership as well. And I'll just echo Hwanda. We're definitely going to miss you. I hope you come bring us some fish from time to time.
[18:44] Great to see you.
[18:48] We're probably going unlisted, so I guess we are going to be called.
[18:55] Thank
[18:58] you very much, Ms. Parsley, great update.
[19:01] Next up, moving along in our cooperative reports, we have our financial services monthly
[19:05] report from our CFO, Mr. Randy Krueger.
[19:21] Board and Board members and members,
[19:25] we'll dive into the numbers here.
[19:29] So for the month of October, our gross margins were about 22 million, which was roughly flat
[19:33] to budget. Net margins were a slight loss for the month and that's actually about a million
[19:38] eight under budget. On a year-to-date basis, gross margins are $242 million, which is about
[19:45] $2.9 million above budget and year-to-date net margins are about $35 million, which is about $1.3 million
[19:53] ahead of budget. With respect to the October performance, as you can see on the graph on the
[19:59] the right hand side.
[20:00] Temperatures were a little warmer than the seasonal average, and so volumes were up a bit. Marges came in about flat, though, because while volumes were up, we had some offsetting items, some of the COVID type items and some true ups to prior month estimates. The real story was at the expense line, we continue to have the variance on depreciation, which we're actually going to do today, a budget amendment.
[20:28] it finally Claudine and Dario cover that a little later.
[20:33] And then our vegetation maintenance, we have some invoices come in.
[20:38] It's this kind of a cyclical deal that caused for the particular month, the expenses to be
[20:42] a bit higher.
[20:44] Let me move forward a couple of slides here and I'll talk about where we're projecting to
[20:49] end up for the year.
[20:51] This graph is showing that the margins where they are cumulative lead for the year through
[20:56] October the 35 million number I
[20:58] referenced.
[20:59] The gray line is what what our
[21:02] budget will look like after all
[21:03] the amendments after we do the
[21:04] depreciation amendment today.
[21:06] We're currently projecting that
[21:07] blue line to come in somewhere
[21:09] between 36 and 39 million.
[21:11] So we should finish the year ahead
[21:13] of our amended budget.
[21:16] The primary drivers for that are
[21:18] margins have been been a bit
[21:20] higher because volumes have been
[21:23] up the we've also expenses have been a bit less overall than we expected mainly in the
[21:30] area of payroll and things like that. So overall from a financial performance we should
[21:36] finish the year just a little bit ahead of what we would have planned.
[21:43] We won't spend too much time on the account growth, we've already covered that but the number
[21:47] of new meters for October was 1900 capital improvements are going to come in a
[21:55] little bit below where we planned them but still a tremendous amount of work is
[21:59] being done on the capital side. With respect to COVID-19 the numbers
[22:05] aren't really materially changed from what I talked about last month we're still
[22:08] estimating the number to come in the total financial impact to be about 3.8
[22:13] million, with about a 1.3 million impact on margins.
[22:20] We provided, as Julie mentioned, about a little over 80,000
[22:23] in member assistance and collected around 85,000
[22:28] in donations, 86,000.
[22:31] Before I wrap it up, one of the things
[22:34] I wanted to highlight this month was give you an update
[22:38] on where we are with our capital restructuring.
[22:41] As you guys know, we've got a tremendous amount
[22:43] on a growth to fund over the next five years.
[22:46] So we've been on a campaign to figure out
[22:49] how we're gonna fund that, raise new sources of capital,
[22:52] and do it in a way that's cost effective.
[22:54] In December, we increased PEC's liquidity
[22:58] by closing $250 million in new short-term credit facilities.
[23:04] The borrowing rate on those facilities
[23:05] is an average of about 1.4%.
[23:08] Our legacy short-term facilities,
[23:11] the borrowing, the equivalent rate was about 2.4%, so almost a full percentage point cheaper
[23:18] than our former sources of funds. We also closed a $200 million private placement shelf,
[23:26] which will allow us access to long-term capital that we'll use to support our future growth.
[23:33] Under that shelf, we funded 75 million of 30-year debt at 2.18%, which is the cheapest,
[23:40] I think we've ever borrowed in history as far as I can tell and yeah, I don't know if we'll ever get that low
[23:45] right again, but it was a tremendous accomplishment. And so it really positions us well as we move
[23:52] into the future. We're still working so this marks the completion of some of the first step of our
[23:57] capital program. We still got some more work to do that will be finishing out during the first quarter.
[24:05] I'll just say also to cap off 2020 you coming here and some of the initiatives that you
[24:13] have pursued have made a big impact for us. I want to thank you for hitting the
[24:17] ground running right away. It's been a big benefit for us here at PEC. So thank you for
[24:22] that.
[24:23] Thank you. It's not just me. There's quite a few people that have been working with me,
[24:28] but thank you.
[24:29] Well, I just want to, you know, really appreciate the efforts in getting that secured lower rate and what not most of us don't like that, you know, that's not a fun thing, but in this case, it's a tool to help manage the growth that we're experiencing and that way we're not putting the expensive capital growth on the existing members were able to leverage that on future members that are coming in and it's just, it's something you have to do and it's just a tool and I appreciate the work that you put into it to secure
[25:00] Give them a cheaper tool. Thank you. Very good. Thank you. We'll see you next soon for that resolution. Okay. Okay, next up moving on our monthly reports. We have our operations report from our chief operations officer, Mr. Eddie Doe, tree. Good morning, President Pataki, members of the board. In your packet, you have a full operations report. It's a pretty standard routine report and CEO partially covered quite a bit of operational aspect.
[25:30] aspects of it, so I would just like to touch on a few things.
[25:34] One, we have no injuries to report in the month of November.
[25:37] However, we have had a lost time accident early in December that you'll see in the report next month.
[25:45] We had a training crew lifting training poles out, and a pole came unbalanced.
[25:52] Lifting one of our journey workers in the area came down and broke his leg.
[25:55] So, we have our safety team out there, they did a full investigation, corrective actions
[26:00] on job briefings and hoisting of polls, but y'all will see that in the next month, unfortunately.
[26:08] We had two minor vehicle accidents that continues to be a strong focus for us.
[26:16] Touching on the growth that Julie and Randy mentioned, we're closing in on 350,000 accounts
[26:24] We should hit that in the next two or three months.
[26:27] Just for a little reference on the growth,
[26:30] back when President Pataki joined the board,
[26:33] we had 220,000 members and 260,000 accounts.
[26:39] So almost 100,000 meter growth.
[26:43] When I started, we had 110,000, so it's going fast.
[26:49] I'm very proud of the Sadie.
[26:55] I'm very proud of the Sadie metrics
[26:57] that we're hitting right now, I think the teams are doing a great job.
[27:00] You do see a tick in, down in service levels, what we're doing right now,
[27:06] the calls that we're handling, they're long.
[27:08] We're spending a lot of time with our members trying to set up payment arrangements.
[27:13] We're also changing some of the rounding cues on our third party call center.
[27:17] We want to increase our member engaged.
[27:19] We want to interact more with our members.
[27:21] So we're starting to drive more calls to us versus the third party.
[27:24] So I expect that to stabilize as we catch up on collections early in the year, but it's
[27:31] nothing to be concerned about. Other than that, I'm going to provide a full year in review of
[27:37] operational aspects next month. All your engineering projects are on schedule. All our
[27:42] system maintenance projects are on schedule. So overall, we're looking to coast into the 2021.
[27:48] I might be the only time we hear coasting in a description of 2020, but we'll take it.
[27:56] Any comments, Mr. Doatrie?
[27:58] Director.
[27:58] One more.
[27:59] I'm wearing out my comment section, but I just wouldn't want to meet and go by without
[28:04] reporting in that on Tuesday night at about 1015 when I'm all tucked in watching the very
[28:08] important weather segment of the news.
[28:11] Power goes out.
[28:12] Flickr's a couple of times that goes out.
[28:13] I'm sitting there.
[28:14] and I wait for about three or five minutes or so
[28:17] and I texted Eddie and said,
[28:18] hey, power's out, by the way.
[28:21] And oh, let me check into it.
[28:23] So we went back and forth and figured out
[28:26] that a vehicle had struck a pole and snapped a pole.
[28:33] Didn't know exactly where it was.
[28:34] I said, okay, so I called the county's dispatch
[28:37] and found out where it was.
[28:38] It was just down the road.
[28:39] so I sued up and go down and it was just interesting and reassuring to work
[28:47] with Eddie through that and all the communication that goes back and forth and
[28:51] virtual came out from Oak Hill and they already had the crews you know all
[28:56] tooled up not sure exactly what they were going to get into but they're ready to go
[28:59] and tackle the issue and I think there was about a total of about 900 people out
[29:04] or so and you know within about two hours power is restored through backfeeding
[29:11] switches and whatnot and they prop the pole back up until they could replace it
[29:16] in the next morning and it was just it was really reassuring to watch how the
[29:21] system worked on getting the power up and running and being out there and
[29:26] luckily the person survived the crash but it was horrendous and but just it was
[29:33] nice watching the crews work and being there with Virgil he certainly set the stage for stability
[29:39] in the process so thanks to you. He's back there right there so. Oh there you are. Didn't see you.
[29:47] Well I appreciate that that's the crew responded as they needed to and unfortunately the person didn't
[29:56] I mean, it was it was a significant. Yeah.
[30:01] We have pictures. We actually have some video of hoisting the poll back up. Maybe I'll show that next month. But yeah, you did have a question about earlier about recovering expenses and damages on our system. We do file that with insurance companies. Virgil mentioned we're about 75% successful in recovering those funds. Part of the, part of the job. Well, I mean, every driver is supposed to have a liability insurance. And so that'd be a part of it.
[30:29] So, I wouldn't think it'd be a tech two, let's do it, you got 10 or 12 guys out there responding and cost of materials, you probably hit that limit pretty quick. But, yeah,
[30:43] well, it was a big, it was a big line.
[30:47] Well, I'll just echo, I mean, being in the more dense part of the territory and my family living right in the heart of probably the fastest has been the fastest growing part of the territory at times.
[31:00] We see a lot of what you guys do to improve the system so that people can keep enjoying good quality of power right by where my kids go to school.
[31:08] they had an underground upgrading process happening and just seeing the professionalism
[31:14] of the crews working the hair making sure they weren't disruptive as much as possible
[31:19] to the people that were living the hair making sure it went off of that hitch.
[31:22] You do a great job whether it's out in the rural part of our territory or in the more suburban part
[31:27] where we are. So great work all around. Thank you. I think that takes us to the end of our reports,
[31:36] It's monthly reports for this month.
[31:39] Next up, we have our member comments section.
[31:41] As we have stated in past months,
[31:43] without our members being able to be here,
[31:45] we hope that we can change that as we are able to
[31:48] when circumstances lend itself to that.
[31:51] In the meantime, we are offering for our members
[31:53] to send us their comments to us digitally.
[31:57] So we have been receiving those.
[31:59] I think we had three members send in comments this month.
[32:02] And of course, you can reach us at any time
[32:04] on our PEC board emails, which are posted on the website.
[32:07] I'll just list the members that did right into us,
[32:10] and I know that we did receive them.
[32:11] We all have copies of your comments up here.
[32:14] Mr. Hart and Wonderlick, I'm sorry, I'm going to mispronounce
[32:17] some of these names.
[32:18] Mr. Weiser and also Nat Ramesh.
[32:22] I'll send us some comments one in regards to new service fees,
[32:26] the others in regards to your remember relations,
[32:29] processes, and also power issues plans
[32:32] for what our future sources might be.
[32:35] So thank you for those comments,
[32:36] and if you have any other further comments,
[32:39] feel free to reach out to us at any time,
[32:41] and we hope to welcome you back in person,
[32:43] as soon as we can.
[32:48] Okay, that takes us to the action items for today's meeting.
[32:52] First up, we're gonna have Mr. Krueger come back up,
[32:54] or one of his representatives,
[32:57] to present Resolution 2020461,
[33:01] which is the depreciation change for the budget
[33:05] that he had mentioned.
[33:18] Good morning, President Pataki, board members and to the members.
[33:21] As Randy mentioned earlier in the monthly financial report, we are requesting a budget
[33:27] amendment of $6.9 million for our depreciation.
[33:31] This is due to the depreciation study done back in 2019.
[33:38] Excuse me.
[33:39] The expenditures of the cooperative funds and staff time are not impacted with this because
[33:45] as it is an on cash item.
[33:50] Any questions, comments?
[33:51] I'd entertain a motion.
[33:53] Motion in a second.
[33:56] Any other commentary?
[33:58] All is in favor?
[33:59] Aye.
[34:00] Any opposed?
[34:01] Any abstentions?
[34:03] That passes 7-0.
[34:04] Thank you very much.
[34:05] Thank you.
[34:07] Okay, next up we have Ms. Natalia Mack.
[34:09] She's got a few resolutions here.
[34:12] We'll start off with resolution 2020344,
[34:16] which is the approval to amend
[34:17] and our tariff and business rules in regards to inter-connected generation is MAC.
[34:22] Good morning, members of the board.
[34:24] My name is Natalia Mack, rakes manager.
[34:26] I am here to ask your approval for a resolution regarding our inter-connect generation process,
[34:33] fees and rates.
[34:35] And while these changes for the rates will not be effective until January 1st of 2022, the
[34:41] language will sit in our tariff, botched for everyone to be able to look up and understand.
[34:46] We're also working on tools to allow our members either to call us or do it themselves where they can figure out what the financial impact, if any, would be of this rate to them.
[34:59] So with that.
[35:00] I ask for your approval. Move approval. Second. Okay, we have a motion in a second. We were presented this last month. Hopefully you've had a chance to visit with the team if you had questions. So there being no further discussion. All is in favor. Aye. Any opposed? Any abstentions? That passes 7-0. And now we have, I'll just let you present the next two resolutions. Thank you. So the next resolution for your approval is regarding the unmetered devices rate.
[35:29] While there have been no changes to the language, I did add a slide here that would differentiate
[35:35] between the lighting and the non-lighting device rate schedules.
[35:40] This would be effective for your first, and I ask for your approval.
[35:46] Over-approval.
[35:48] Sorry.
[35:48] We've motioned in a second, and this was presented last month.
[35:52] Correct.
[35:53] I don't know.
[35:54] Other comments or questions?
[35:56] All is in favor.
[35:57] Hi.
[35:57] by any opposed, any abstentions, that passes 7-0.
[36:02] Final resolution for your approval is regarding the rate plan.
[36:05] I did present on the details of each change last month.
[36:09] There has been only one change.
[36:11] The power plant rate will be effective March 1st, 2021,
[36:16] instead of immediately upon board approval in order for us to prepare for the billing changes.
[36:22] this. Otherwise, there have been no changes, and at this point, I'd like to ask for your approval, and thank you.
[36:31] Okay, motion in a second with that change. Now it is the last month.
[36:35] Director, we would just need you to amend the resolution that's in the package.
[36:42] It's not the same.
[36:42] So if the motion could just be as amended for the effective date.
[36:47] So I'm going to change my motion to make the motion more clear that the
[36:55] rules are being
[36:58] amended as presented with the new change of effective date March 1, 2021.
[37:08] So maybe seconded.
[37:09] Still seconded.
[37:11] Okay.
[37:11] Still move.
[37:12] Move to the next second.
[37:14] Okay.
[37:15] Any other comments, questions?
[37:17] All of the favour?
[37:19] Aye.
[37:20] Any opposed?
[37:21] Any abstentions?
[37:21] that also passes 7-0. Thank you for your great work on all of this. I know it's been a lot of time
[37:26] spent with your team to make it just right. Appreciate it. Oh, yes, Dr. Good.
[37:32] I'm really, really happy to hear about that you're going to have information available to members
[37:37] because I have been reached out to members already that have started to hear about this and they are
[37:42] very interested in how it's going to affect them and I'm anxious to see how that is. I'm encouraged
[37:47] that y'all are already addressing that so that they can adapt and try to determine how
[37:51] it's going to directly affect them. So I'm really happy to hear that.
[37:56] Thank you for your time. Thank you so much. Next up, we have Mr. Richard Ariyano who's
[38:02] going to be presenting Resolution 2020444, which is the approval of Contract Agreement
[38:08] Extension for Security, Vulnerability, Assessment and Master Plan.
[38:12] Good morning board members. I am Richard Ariano, Vice President of Sport Services. And as
[38:16] As stated, I am here to ask for your approval of the contract agreement extension for security, vulnerability assessment, and master plan as stated at the prior meeting, we have a current contract for $416,000, $197,000 of that is going toward the assessment, which is now complete, and then a remainder of $220,000 would be applied to master plan development and implementation.
[38:41] We are coming before you for the extension because it is a three year period and we'd like to have their services available as needed over this time.
[38:50] Move approval.
[38:51] Second.
[38:52] We have a motion in a second.
[38:54] Any other questions or comments?
[38:55] It was presented last month.
[38:57] They're being none. All those in favor?
[38:59] Aye.
[39:00] Any opposed?
[39:02] Any abstentions that passes 7-0.
[39:03] Thank you very much.
[39:04] Thank you very much.
[39:06] Okay, next up, Mr. Merrill, be up to talk about Resolution 2020445, which is the approval
[39:13] of our 2021 Cooperative Election Timeline.
[39:16] Good morning, I'm Sylvia Romero, governance manager, and I'm here today to present a
[39:21] approval of the 2021 Annual Election Timeline.
[39:24] There have not been any changes.
[39:26] It was presented last month.
[39:28] Thank you.
[39:31] Okay, motion.
[39:32] We've got an active bunch down here on the motions.
[39:35] Okay.
[39:36] Quick.
[39:38] I can't believe it's already that time again, but it makes up on us over the years.
[39:41] If there are no comments or questions, all those in favor?
[39:44] Aye.
[39:45] Any opposed?
[39:46] Any abstentions?
[39:47] That passes 7-0.
[39:48] Thank you, Mr. Mero.
[39:50] Next up, item 12, resolution 2020-213, which is the approval of our 2021 election communications
[40:01] Good morning, board members, and those of you who are streaming this morning, Mike Vesca, Executive Vice President of Public Affairs. And I do ask that you approve 2020-213, which is our elections plan for communications plan for the year. We do not have any changes that we made since it was presented last time, so I ask for your approval.
[40:26] That was a great time.
[40:26] Your thoughts are visible.
[40:26] Super-proof.
[40:27] Very good.
[40:28] Okay.
[40:28] Motion in a second.
[40:31] Comments, questions?
[40:33] You're being none.
[40:33] All is in favor.
[40:34] Aye.
[40:35] Any opposed?
[40:36] Any abstentions?
[40:37] That passes 7-0.
[40:38] Just your team on the communal relation.
[40:40] Thank you, Moor.
[40:41] You've all been doing a great job.
[40:42] Thank you very much.
[40:42] Communication at this time is more important than ever.
[40:44] We can't see our members in person as much.
[40:46] Thank you.
[40:47] We appreciate that.
[40:48] Thank you.
[40:49] Okay.
[40:50] Now we have several draft resolutions to hear.
[40:52] First up, we have item 13, which is Resolution 2020, 338, approval of our contract extension
[41:01] for National Information Solutions Cooperative in ISC as we hear it.
[41:06] Welcome.
[41:07] Good morning, board members.
[41:08] I'm Amanda Moropolis, Director in Information Technology.
[41:11] Today, I'm bringing a draft resolution for your consideration regarding an extension of
[41:16] the current National Information Solutions Cooperative in ISC agreements.
[41:21] This request to renew and extend our NISC IVU software maintenance includes not only AMS,
[41:26] the automated mail services and merchant services, but support for all of the IVU components,
[41:33] like ABS, CCNB, smart hub, call capture, smart track, MDM, and app suite.
[41:39] The AMS portion includes mail and postage cost for bills and any correspondence that's handled
[41:44] by NISC.
[41:49] Just for reviews that we're not voting today, but do you have any questions?
[41:53] How long is the attention for?
[41:56] Five years.
[41:57] Five years.
[41:58] Yeah, let's cost of it.
[41:59] It's three and a half million per year for a total of 17.5 million total.
[42:05] Practically speaking, we don't really have any options.
[42:08] I don't think anybody else wants what you just want to do away with the ANC and we can't
[42:12] do that.
[42:13] Are they done a good job for us?
[42:18] Okay, so we'll see you back next month.
[42:19] Thank you very much.
[42:20] Thank you.
[42:21] Okay.
[42:23] Next up, item 14, which is our draft resolution 2020387, which is the approval and review
[42:31] of our employee compensation policy.
[42:34] Good morning, board directors.
[42:36] I'm Wes Ferns, Human Resources Vice President for PEC.
[42:39] And before you, is a draft revised policy titled the Employee Compensation Policy.
[42:45] In summary, the purpose of this policy is for the Board of Directors you to provide direction to the CEO and to PEC so that we can establish competitive pay structures and this helps us attract and retain the best talent to serve the membership.
[43:02] So the revisions are relatively minor and just in good keeping with the review periodically of our board policies.
[43:08] Yes,
[43:16] I believe we continue to be very competitive.
[43:20] Can you give us an example of one of the key revisions you might have?
[43:25] There are many of them are pretty minor. One was the previous policy made an exception to the CEO and to one other executive role.
[43:36] So there is now an exception to all vice presidents and above.
[43:39] of because that compensation is a different strategy.
[43:43] There's different responsibilities and different scopes.
[43:52] You feel that change is in keeping with what you see
[43:54] and peer entities like ours.
[43:57] Correct.
[43:57] And we do a pretty diligent job of looking
[44:00] at independent third party consultants
[44:03] that give us a lot of information
[44:04] of what the other utilities pay.
[44:08] You have another resolution next if you want to present that.
[44:11] Correct.
[44:12] Yeah, thank you.
[44:13] So, also before you as a draft revision of the holiday policy, which outlines our business
[44:18] operations and how we keep them open and closed for certain holidays that we observe.
[44:25] And it establishes a pay code for our employees, which again is another benefit that helps us
[44:30] attract and retain the very best talent to serve PEC.
[44:36] Good to graph.
[44:37] And what kind of changes did you make there?
[44:39] These are really minor, again, just basic housekeeping.
[44:44] It referenced member services.
[44:46] We call them member relations now.
[44:49] It's not five new holidays or something like that.
[44:51] We didn't introduce any new holidays.
[44:54] Those are welcome anytime.
[44:56] Yeah, right.
[44:57] We're open to it.
[44:58] Yes.
[44:59] We have a big.
[45:00] Council appreciation day. Here, here, is there a second for that? We're not voting today. So we have a very good holiday schedule, and it's, it's very competitive, I think.
[45:11] Speaking of adding holidays a few years back at the suggestion of director acres, we added Good Friday as a day. Has that been well received by employees? Absolutely. I was pleased in the first employer that offered that when I came here. So
[45:28] We still have two floating holidays that employees can also enjoy and pick at their convenience
[45:34] to take.
[45:36] Okay.
[45:36] Well, we'll look forward to voting on these next month then.
[45:39] Yes.
[45:39] Thank you.
[45:42] That's okay.
[45:43] Good.
[45:43] Very good.
[45:43] Next up on our draft resolutions.
[45:46] Mr. Doutrieve is back.
[45:47] We have draft resolution 2, 0, 2, 0, 4, 6, 7, which is the approval of our 2021 key performance
[45:54] indicators plan.
[45:56] Morning, President Pataki, members of the board.
[46:01] You received this package, presentation, and KPI document earlier in the week.
[46:09] I apologize for having it green-sheeted, but we're waiting on timeline information to
[46:13] be able to update this.
[46:16] Just a little background.
[46:18] I will be in front of the board over the next three months, talking about KPI's.
[46:22] Today we're going to talk about the plan for 2020.
[46:26] This is a draft resolution we will ask for your final approval in January, and then in February I'll be back to
[46:33] present the results of period to 2021, so all the data comes in.
[46:39] Just a little background, our KPI plan has very much aligned with the JD power syndicated survey that we follow.
[46:46] You can see the categories on the bottom right, power quality, 20% cost in price, 15% waiting.
[46:53] the next four billing and payment, corporate citizenship,
[46:57] communications and customer service, all 10.
[47:00] And of course, safety and compliance at 25,
[47:02] which is a strong indicator that that is the most important thing that we need to be focused on.
[47:09] So just getting into it, the structure of the program and
[47:14] the metrics that we have has not changed significantly, but
[47:17] we do have a few things we want to touch on.
[47:20] First of all, we currently, our state is at 40 minutes.
[47:24] Last year's goal was 63 for a silver up to,
[47:29] our down to 53 for platinum.
[47:31] We want to move that down and you may be wondering
[47:34] why we're not going all the way to 40.
[47:36] There's a few reasons.
[47:38] One, we've had very, very favorable weather this year.
[47:41] Also, we're implementing a new OSI
[47:44] outage management system in our control center
[47:47] early in this year.
[47:48] and anytime you implement new systems,
[47:51] there are stabilization periods that follow,
[47:54] and there's concerns that along with weather,
[47:58] this is probably a good target for us
[48:00] to try to hit for next year.
[48:04] Yes, sir.
[48:05] Do y'all take into and I love the city.
[48:07] I know we're very, very cognizant of that,
[48:08] but sometimes if we were to have some catastrophic weather,
[48:11] is there anything built into where it's beyond
[48:15] the employees control?
[48:17] I mean, you've got everybody on the ground,
[48:18] everybody's doing their thing and physically cannot, you know, that's not their fault.
[48:22] Yes, there are certain weather events both in duration and time and multiple days out that
[48:27] are excluded from the city. And the city is really the things that are calculated. It truly is
[48:34] response on routine outages and system failures, not catastrophic weather events.
[48:42] I believe it's an IEEE standard that we follow there and I think it also does not include
[48:49] include like one shot or shark outages too. I don't believe that's included.
[48:53] That correct. Yeah, all that is maintained and all that is calculated and maintained in
[48:57] the control center by Brian Staff and Tony and the control center director.
[49:02] Unless coming up 50 minutes for platinum. I don't have any problem with that. 50 minutes is
[49:08] world class. Absolutely.
[49:12] There's a challenge by making it too low. It starts to raise in safety
[49:17] concerns as well.
[49:21] Cost and price, we do have some changes suggested here. Instead of the total
[49:27] distribution spend per meter, we want to go to an operating expense as a percentage of budget.
[49:33] I think Randy is doing a great job and his budget team and I think this is a metric that we really
[49:38] want to try to focus on.
[49:41] The second one that we want to introduce is competitively sourced
[49:46] spend. So we did a lot of work with the procurement department over the last year and we have
[49:53] of now are competitively sourcing almost everything through the
[50:00] Precurement department. And I think this is a good metrics to focus there. Then, of course, the competitive rates. We would have the pretty much the same as last year. And then we would remove. Let me get to the next slide. So the overtime is a percentage of total hours. We want to remove this metric. There's some instances where overtime may make business sense.
[50:31] rather than utilizing contractors.
[50:34] Some of it can be unavoidable with outages
[50:36] and different things like that.
[50:38] And then the 4CP avoidance, this is a metric
[50:41] that is really can only be influenced by a small group.
[50:46] So we want this to be a metrics program
[50:49] that can be influenced by a large workforce,
[50:53] a lot of people.
[50:56] Moving on to billing and payments.
[50:58] These stay the same, but we want to adjust the metrics.
[51:01] We want to one reflect where we are today, and also set some growth marks for us going
[51:09] in the future.
[51:10] So, these are very, very healthy statistics here, and participation rates, and we want
[51:16] to continue to drive that.
[51:20] Corporate citizenship, the community outreach, we want to lower that to reflect really what
[51:26] we can do in this COVID environment, until we can really get to a point where we're out
[51:31] engaging our members, it's pretty limited on what we can do as well as the volunteer activities as well.
[51:41] What we want to do on this communications, there's an internal communications program that
[51:48] Mike Villesca and his team are putting together. We have a newsletter called Wired.
[51:53] What we really want to do is heavily promote this over the next year. We have a lot of folks
[51:58] through remote working.
[52:00] We're strained in how we can have in person
[52:04] and face-to-face meetings.
[52:05] So we wanna really drive this to the employees
[52:08] to increase our employee engagement.
[52:11] And so there's quite a bit of structure
[52:13] that Mike and his team put around this
[52:14] and tracking the readership and viewing
[52:17] of these communication pieces.
[52:23] Service level, we had a goal of 85%.
[52:27] that we actually want to lower this year.
[52:30] There's a few reasons for it.
[52:32] One, we're going to have a AMI deployment,
[52:36] meter deployment, which typically drives phone calls.
[52:39] We also are trying to rebalance some of the call flow
[52:44] from our third party call center and to our staff.
[52:47] And knowing that we're going to have quite a bit to do
[52:50] with collections in earlier part of next year,
[52:53] it's, I think the industry standard is 80%.
[52:56] we'd like to make that a target this year.
[53:02] And then finally on the safety and compliance,
[53:07] one thing that we'd like to introduce this year
[53:09] is a different calculation for how we track vehicle accidents.
[53:14] Instead of just having a number of vehicle accidents,
[53:17] we'd like to align this with more of an industry standard
[53:21] on how we calculate it and factor in total miles driven per accident.
[53:26] And the calculations there, you can see 3.5, 2.5, and 1.5 is consistent where we are today.
[53:35] It's just we want to factor in the mileage knowing that the utilization of these vehicles
[53:40] made different out of situations and different things like that.
[53:45] And then for the adder that we typically have last year, we had a 1% adder for achieving the
[53:53] say 80 of 50 minutes or less in a second period, a 1% adder for achieving a top 10 overall
[54:01] ranking in the JD power syndicated survey.
[54:04] What we want to do this year is focus solely on the JD power survey and have a 1% adder
[54:09] for both first period and second period if we get in the top 10 overall utilities in the
[54:16] midpoint scoring.
[54:19] So with that, that concludes this presentation.
[54:22] I'm happy to answer any questions we have.
[54:24] I gather any additional information.
[54:27] I would come back next month asking for final approval.
[54:31] And then in February, present the results of 2020 period two.
[54:35] And then hopefully we can be completely done
[54:37] with 2020 at that point.
[54:40] Retrograph, did you have a comment?
[54:42] I just have a comment.
[54:42] I mean, it looks like y'all had a lot of executive level wrangling to come up with all this and I just think it's a very well thought out plan.
[54:51] Thank you.
[54:52] And we're actually looking at some things right now to plan for 2022.
[55:00] Some of the metrics we want to start capturing, one with the metering system, one with the new control center software that we're putting in. So we're proactively thinking ahead on this step too. On the vehicle with the new matrix that you're proposing, how would we have done, if that was in place this year, where would, where would we have landed based on the accidents that we had versus the miles traveled about the same with this. This is just aligning the metric with more information.
[55:29] industry standards. And it's good. Brian maggots back here today. He and I and Wayne McKee have routine
[55:38] conversations about vehicles and utilization safety accidents and it's a continued focus for us.
[55:50] We definitely want to keep the focus on it. We don't want to be unfair but they're
[55:54] of all the great work that are lying crews to have something like that be something that they don't necessarily feel is comfortable with.
[56:02] We had to make sure we're giving them the right tools to be successful there and that's important very good.
[56:07] Okay, so you'll be back next month for final approval of this.
[56:11] Okay, very good. Thank you, Eddie.
[56:15] Okay, next up, we have item 17 resolution 2020464 which is the approval of our 2020 capital improvement plan budget.
[56:25] amendment for purchasing land for sub-stations.
[56:30] Good morning, board members. My name is Brian Getter, Chairman of Vice President of Engineering,
[56:34] and I'm bringing you address for us resolution 2020-464. And this is, if you recall, back in 2019,
[56:43] these three sub-stations were supposed to be completed. We thought they were going to be completed
[56:47] by the end of the year, so they didn't get into the 2020 budget because we thought they'd be done.
[56:52] However, because of legal issues around Esperanza with land and then delays in the Ridge Mar and Spanish sub-station because of
[57:04] Elseria was building those
[57:06] It moved into 2020 so the money was budgeted in 19 not in 20 so we need to do a budget-result amendment
[57:14] Because now we have to pay for Elseria in 2020 that and actually the 7 million we finally got the the
[57:22] invoices the last two invoices last night and it comes out the 6 million 25 thousand 731
[57:29] dollars and 75 cents. So when I do the final resolution, we're asked for approval. I'll fix that number.
[57:37] I'm as a questions director graph. 6 million covers all three stations. Yes, but it is over budget.
[57:45] It is over budget. And if you recall back at the time, it really is around land.
[57:50] in the condemnation. We don't condemn for a sub-station property. LCRA does. There's some other issues too that we should probably talk about in executive session if it's more detail.
[58:01] And it will be taken care of this year than it won't spill over into 2020.
[58:06] Right. But we don't want it. Well, yes.
[58:09] Is the timing of that going to work out? Okay, I'm sorry. It'll work out. Okay. It's actually what Randy wants.
[58:13] Okay, very good, so we'll see you back next month on the new substations, okay?
[58:22] Thank you.
[58:23] Okay, next up, Mr. Ariono is back for item 18, draft resolution 2040441, which is the approval of our fleet maintenance and repair contract.
[58:33] Good morning, again, board members.
[58:34] I am Richard Ariono, Vice President of Support Services and I'm bringing to you a draft resolution for the approval of a fleet maintenance.
[58:43] and repair contract. Currently, the incumbent on this service is Pinsky. We're asking for
[58:49] a five-year contract agreement with a value of $15 million.
[58:56] Presently, we're in the RFP process. We are still accepting respondents. The RFP will
[59:02] close the 22nd of this month. We anticipate having a selection made by the 8th of next month.
[59:08] We will come back to you in January with the final resolution with the vendor.
[59:18] Okay, that's our drivers.
[59:19] In relation to the last five years,
[59:24] people or you see a rise in the cost of repairs maintenance.
[59:28] We are anticipating an increase.
[59:30] The fleet is constantly increasing in size and it doesn't become cheaper to maintain it.
[59:39] That's really what drives the increase in size.
[59:42] We're not buying more vehicles per person.
[59:44] it's just we have to add more vehicles because we have more employees in the field serving more meters.
[59:51] I remember historically we've made some changes in how we
[59:54] run this program is the way we currently do it. Is it effective? Is it working out? Well
[1:00:00] We have had really good results with it. We could staff it internally. We simply have made the choice not to do so. We've used contracted services. I would say that going forward, it is something we could think about as an employee-based service because it doesn't go away. It's not something that goes up and down. It's simply going up and amount of work performed. But it present, this has been an approach that has worked.
[1:00:29] We are very comfortable extending it, but it would be a very different change of mindset to bring all of these employees in house.
[1:00:37] Good, directly.
[1:00:39] Conversely, another way to think about it is, of course, we're committed to making sure that vehicles, you have all the vehicles we need that are in great condition and whatnot.
[1:00:49] But on at least some of the vehicles might it not be worth a conversation to do some discovery on the cost to lease the vehicles that comes with maintenance and repairs.
[1:01:02] I know we have as part of this budget process gone to a leasing where it makes sense.
[1:01:09] We are not leasing all vehicles.
[1:01:11] Only those where we can really make sure that we don't.
[1:01:14] Um, our better said that we get more value out of a lease than ownership.
[1:01:19] But on those lease options, does that come with maintenance built in?
[1:01:22] Uh, I believe that we have to maintain the vehicles even in a leasing situation ourselves.
[1:01:27] That's what I was trying to do.
[1:01:27] This contract was the maintenance cost if you were to lease it.
[1:01:31] That's not the situation with the lease structures.
[1:01:33] I understand it.
[1:01:34] I'm looking over to Cody at this point and he's saying, no, but, uh, we have to maintain
[1:01:38] the vehicles that we will lease in coming years.
[1:01:42] and they would be performed through this contract.
[1:01:48] Big money, but it's important.
[1:01:51] I'm sorry.
[1:01:52] So it's big money, but it's important.
[1:01:53] We got to have money.
[1:01:54] It's an enormous amount of money, but it's one
[1:01:56] of those things that you simply can't avoid.
[1:01:59] You're going to pay one way or the other.
[1:02:08] Maintenance is everything.
[1:02:10] I mean, if you maintain something really well, it performs
[1:02:14] when you need it and conversely, if you don't,
[1:02:16] it doesn't perform when you need it.
[1:02:18] and sometimes it can be catastrophic and it's failure.
[1:02:21] So we have a real obligation to keep this fleet
[1:02:23] in tip top shape.
[1:02:25] And when you see our trucks out in our communities,
[1:02:28] they look great.
[1:02:30] They look great, which I have a personal thing to do.
[1:02:32] And that's as much a tribute to just the culture
[1:02:35] of the people who use them.
[1:02:38] Housekeeping is a real priority.
[1:02:40] And Ryan could talk a length about that,
[1:02:42] Wayne could talk about it.
[1:02:43] It's something we really emphasize through safety.
[1:02:46] Housekeeping is fundamental.
[1:02:49] Okay, so we'll see you back next month for that one.
[1:02:51] Yes, thank you.
[1:02:52] Okay.
[1:02:54] Next up, we have item 19, which is 20, it's not a resolution.
[1:03:00] Item 19, which is our cost of service study and fee review report with.
[1:03:05] I guess Dave is going to take us to this presentation.
[1:03:10] Board, my name is David Thompson on the vice president of markets.
[1:03:13] We have Jim Daniel and Nick Weaver on the phone to go through this.
[1:03:17] to T.A.D.S. also did parts of our other cost of service in our line extension.
[1:03:22] So the same folks will be presenting, and I will be clicking through the slides.
[1:03:26] So if you have any questions, I can help or if you want to ask them directly to the gentleman.
[1:03:33] Welcome, gentlemen, to PEC.
[1:03:36] Good morning, this is Jim Daniel and Nick Papers also on the board members.
[1:03:47] I've been involved in regulation for over 40 years, and as David said, been helping
[1:03:54] PEC on various projects.
[1:03:58] Nick also has been involved in several projects, and he was one of the witnesses on pertinalysis
[1:04:10] recent interim T-cost case that was approved.
[1:04:14] I don't think I'm going to go over every slide, but there are several that I'd like to refer to David.
[1:04:26] The second slide is just a little information about GDS.
[1:04:32] The only thing I was going to mention is that since that slide is prepared,
[1:04:37] we have fairly recently acquired another firm that's similar to us
[1:04:44] in Seattle, Washington. So we now have an office in Seattle and have about 190 employees.
[1:04:55] The slides, three and four kind of just
[1:05:00] We described what our assignment was in this project, mainly three things that we did. We compared
[1:05:09] your current fees with analysis that we did to determine what your current cost of providing
[1:05:17] those services is. We also did a survey of other utilities just to see if pernallis had
[1:05:28] it had any outliers as far as what they were charging, what if you were charging.
[1:05:34] And then we looked to determine whether we should add or delete any of your fees.
[1:05:42] As far as the methodology,
[1:05:47] it's fairly standard methodology that's used to determine service
[1:05:52] fees.
[1:05:53] The problem we usually run into is that the information that you need to calculate the fees is
[1:06:01] something that the utility typically doesn't track or book.
[1:06:08] For pernalous, we did have good data.
[1:06:12] That wasn't a real problem.
[1:06:15] That was a big help and hurdle that we didn't have to address
[1:06:21] that we usually find.
[1:06:25] And on the survey, we looked at approximately 20 other utilities, mostly co-ops.
[1:06:35] We looked at neighboring co-ops, and then some of the larger co-ops.
[1:06:43] And we also looked at a few municipal's and IOUs,
[1:06:48] but that's kind of what our assignment
[1:06:52] was the slide 5 is the results of the analysis.
[1:07:01] These are the recommended piece.
[1:07:08] Some of these increased, some of them decreased, which are identified on a couple of the following slides.
[1:07:17] I think the ones that I would want to point out are the fees that we're proposing to add.
[1:07:28] There are two of those. One is a lead design fee.
[1:07:34] And that is mainly when you have either a big project or a big development.
[1:07:40] And your initial design goes through a lot of changes.
[1:07:49] And currently, there's not a way to charge for the work
[1:07:52] you do to make those design changes.
[1:07:56] So this will allow you to charge for that service.
[1:08:01] There will also recommend to add a miscellaneous trip fee.
[1:08:07] This is a situation where a member may call for a service of some sort.
[1:08:15] So you have a truck roll to the member site.
[1:08:19] When you get there, you either can't access the property or the custom cut the member's not there or not ready.
[1:08:29] So it's kind of a wasted trip.
[1:08:30] But you didn't provide the service, but you incurred a cost.
[1:08:36] And this is going to allow you to charge for that trip.
[1:08:43] So slide five is the fees that we recommend that you approve.
[1:08:51] I'm not going to go through any of these in details.
[1:08:56] But if you have any questions on any of these,
[1:08:59] Nick and I'll be glad to answer this.
[1:09:07] That I'll turn it back to you, David.
[1:09:14] I'd want to, since Jim brought these up,
[1:09:17] the fees that are recommended to add
[1:09:19] and then the other changes are direct
[1:09:22] from just updating our costs to serve.
[1:09:25] And these two fees added align us
[1:09:27] with standard utility practice.
[1:09:31] There, these aren't really revenue-generating fees
[1:09:34] by any stretch.
[1:09:34] These are meant to recover our costs
[1:09:36] for unique situations that we find.
[1:09:38] And we will be bringing some language back to implement these recommendations in January.
[1:09:46] Director, I just like to, I try to remind myself and remind the members that these fees, as you said,
[1:09:53] it's not necessarily to generate income, but it's to make it fair for all members so that we're spreading this out.
[1:09:58] We don't have certain members that are...
[1:10:00] Costing other members' money. So we have to remind ourselves it's mainly to be fair to everybody is is why these are being readjusted if that's the way I'm understanding it correctly. Agreed. If these fees we recommended ad if we never charged those, it would be fine because we wouldn't have incurred the cost. Yes, that's a good point.
[1:10:20] Okay, so I think that's it for questions. Well, well presented and looking forward to the upcoming resolution. Or more on these. Thank you. Okay. Thank you, gentlemen.
[1:10:31] for your presentation. Thank you everybody. I have Matt Chris with you two. Merry Christmas.
[1:10:41] Okay, well that takes us to the conclusion of our action items for today or under the action
[1:10:47] items part of the agenda. We do have another resolution to consider in regards to our proposed
[1:10:53] future meetings. So that's been included in your packet for year 2021. I'll make one special note
[1:11:00] that we have on here at January 22nd Special Meeting here at Headquarters in regards to our strategic
[1:11:07] planning that has been on the books and hopefully everyone's still good with that date.
[1:11:13] So if you have no questions on the list of meetings here, I would entertain a motion for approval
[1:11:20] of these dates in
[1:11:28] a second. This one wasn't as quick, I guess. Okay.
[1:11:31] Okay.
[1:11:34] Yes, what up with that?
[1:11:35] We have just the strategic planning workshop
[1:11:37] on the 22nd.
[1:11:39] Yes.
[1:11:41] Okay, there are no other comments or questions all in favor.
[1:11:44] I, any opposed?
[1:11:46] Any abstentions?
[1:11:47] That passes 7-0,
[1:11:48] so that will be entered into the record
[1:11:50] for our future dates coming out for meetings.
[1:11:53] We also have as a matter of regular review here,
[1:11:59] as our board planning calendar,
[1:12:00] which includes our upcoming written agenda items,
[1:12:03] topically, so hopefully you've had a chance to review that.
[1:12:06] There are no questions we'll move past it,
[1:12:08] but that's always included as a point of information.
[1:12:12] That takes us to the conclusion of our open meeting here.
[1:12:16] Today we're going to be recessing into executive session.
[1:12:21] For anyone that is not going to be around in the afternoon to join us,
[1:12:24] it's a pleasure to see all of you online.
[1:12:26] Again, wishing this panel well.
[1:12:28] She moves off into the sunset of retirement, hopefully join you at some point in the
[1:12:34] future and otherwise Merry Christmas to everyone happy new years.
[1:12:40] So at this time we will recess into executive session, consistent with our board meetings
[1:12:44] policy and bylaws the PEC board will go into executive session for confidential communications
[1:12:49] with legal counsel to receive advice on litigation and where the board seeks legal advice, also
[1:12:54] to discuss contract and competitive matters as designated by the board, as well as real
[1:12:59] state matters, personnel matters and any utility systems, physical and cyber security measures
[1:13:04] that we are discussing. Any votes or actions on these matters will again be taken up during
[1:13:08] open session this afternoon. Thank you again and we will now recess.
[1:13:33] Good afternoon. Welcome
[1:13:34] back to the open session at our December board meeting for personnel selected cooperative.
[1:13:40] We are reconditing from the executive session. For today's meeting to consider some business
[1:13:44] items that we discussed in executive session to consider votes on those measures.
[1:13:50] First up, we have item 2-0 or resolution 2-0-2-0-4-4-9, which is the approval of authorization
[1:13:57] for the initiation of litigation.
[1:13:59] Move approval.
[1:14:00] Second.
[1:14:01] The motion is second.
[1:14:02] Any further conversation?
[1:14:04] Questions?
[1:14:04] All is in favor?
[1:14:05] Aye.
[1:14:06] Any opposed?
[1:14:08] Any abstentions?
[1:14:09] That passes 7-0.
[1:14:10] Next up, we have Resolution 2020452, which is the approval of our 2021 Texas legislative
[1:14:17] positions.
[1:14:19] Approval.
[1:14:19] Second.
[1:14:20] Potion in a second.
[1:14:22] Any further questions, conversations?
[1:14:24] They're great.
[1:14:25] None.
[1:14:25] All those in favor?
[1:14:26] Aye.
[1:14:27] Any opposed?
[1:14:28] Any abstentions?
[1:14:29] That passes 7-0.
[1:14:31] Next, we have Resolution 2020468, which is the approval of authorization for amendments and
[1:14:37] and extensions to co-bank loan facilities for the cooperative.
[1:14:41] Good approval.
[1:14:42] Talk again.
[1:14:42] Motion in a second.
[1:14:43] Any conversation questions?
[1:14:46] There being none.
[1:14:46] All those in favor?
[1:14:47] Aye.
[1:14:48] Aye.
[1:14:49] Any opposed?
[1:14:50] Any abstentions?
[1:14:51] That passes 7-0.
[1:14:53] Next up, Resolution 2020462, which is the approval of authorization for long-term debt financing.
[1:14:59] you
[1:15:00] Further cooperative. Move approval. Motion and second. Any further questions or conversation?
[1:15:06] There may none all those in favor? Aye. Aye. Any opposed? Any abstentions? That passes 70.
[1:15:13] Next up, resolution 2020453, which is the authorization to negotiate and execute agreements for
[1:15:19] construction of a control center. Any further approval? Second. Motion and second. Any further
[1:15:25] questions commentary there being none all those in favor aye any opposed any
[1:15:32] abstentions that passes 7-0 in our last resolution 2-0-2-0-4-9 which is the
[1:15:39] approval review and approval of 2020 CE goals and performance evaluation
[1:15:44] approval okay we have motion to second any further questions commentary just great
[1:15:52] job to our great CEO. Okay, all those in favor. Hi. Any opposed? Any abstentions? That passes
[1:15:59] 7-0. Well, that concludes our business items for today's meeting. Again, I want to wish
[1:16:05] all of our members and our staff wonderful Mary Christmas. Happy New Year, safe holiday season.
[1:16:10] I guess we're not going to be seeing much travel, but if you are traveling, please be safe out there.
[1:16:14] We look forward to seeing you all in 2021. Thank you very much. This meeting is adjourned.