Electric City Power, Incorporated

JOURNAL OF BOARD PROCEEDINGS

August 11, 2008

Electric City Power, Incorporated (ECP):
Regular meeting of the Board of Directors Great Falls Civic Center,
Gibson Room

CALL TO ORDER: 5:30 PM

ROLL CALL: present: Chairman George Golie, Vice-Chair Dawn Willey, Bill Ryan and Bob Pancich. Also present were the ECP Executive Director, and Assistant City Manager.

EXECUTIVE DIRECTOR REPORT

Executive Director Coleen Balzarini updated the Board on the following:

MEIC vs. City of Great Falls recent court filings. Staff has been gathering records for review. The complaint was filed primarily because the City’s position had been that a draft document was not a record. Ms. Balzarini gave a recap of the judgment which requires the City to provide requested documents to the public which are in the possession of the City. SME had asked the City to postpone putting documents out until they could be reviewed for proprietary and confidential information. MEIC filed an additional complaint requesting the judge to order the City to have all documents put out for review immediately. A stipulation agreement between MEIC, City, and SME has been reached as of today (August 11, 2008), in which the parties will set timeframes for the production of various records. The majority of the first documents provided were produced through City Commission action. Following the judge’s initial ruling MEIC sent an email to produce all draft documents, emails, and any other documents, etc. related to HGS, SME and water rights. Much of the information had been made available previously. Gathering the draft documents, emails, and working papers from the various City offices is taking up a lot of staff time.

Board member resignations. Ms. Balzarini recommended that applications be opened again and both resignations handled at the same time.

Mr. Ed McKnight data requests. Mr. McKnight has submitted requests for data. The request of June 10, 2008 was responded to July 11, 2008. An estimated cost of providing copies of the requested information was provided. Mr. McKnight has requested the information be provided in a format that is not currently used and would require approximately two weeks of dedicated staff time to provide. While the City has tried in the past to accommodate the public’s requests for information in different formats, a staff meeting will be held this week to discuss the impact of complying with special compilation requests.

Energy and Telecommunications Interim Committee (ETIC) Reports. Copies of draft reports from the ETIC on Public Power and CO2 were provided.

Public Service Commission July 22, 2008 Agenda. Ms. Balzarini reported that the PSC considered the City of Great Falls complaint. In a document received today (August 11, 2008), the PSC is allowing oral arguments to be made and has set out a timeframe for the various activities related to the complaint. This carries the consideration of the complaint into October 2008.

Highwood Generating Station Project status update. Ms. Balzarini reported that Commissioner Bronson, City Manager Doyon and herself attended the July SME meeting.

Mr. Pancich stated that he appreciated the ETIC information. He felt that what he read in the packet was better information than the public comment that has been heard.

Mr. Pancich asked if an extension for the air permit that expires in November can be requested. Ms. Balzarini stated that extensions have been given in the past but she doesn’t know what the requirements are at this time.

UNFINISHED BUSINESS

The financials as of June 30, 2008 were distributed. They are still not complete as the June 30, 2008 final energy expense is still outstanding. The Board has asked for quarterly statements. The financials will be provided monthly with quarterly summaries. There are no financials for July since not all the information for July has been received. Ms. Balzarini reported that a loss of $200,000 is estimated for the 2008 fiscal year. Ms. Balzarini gave an explanation of the water credits. The water credit portion of the energy payment to SME will expire December 31, 2008, which is in the current Fiscal Year 2009.

NEW BUSINESS

Accept Board Meeting Minutes from July 7, 2008. It was moved by Mr. Pancich, seconded by Vice-Chair Willey, and approved by roll vote, to accept the Board minutes from the July 7, 2008 meeting.

Mr. Ryan asked about the new members of the Board. Chairman Golie stated that applications are still being taken. Ms. Balzarini explained the posting process for Board vacancies.

COMMUNICATIONS

Stuart Lewin, 615 3rd Ave N, expressed concern about the resignations from the Board. He does not feel that they should be accepted. Mr. Lewin stated that people feel there is self-dealing and fraudulent practices happening and that the resignations should not be accepted until all legal matters are taken care of so all members of the board can share the responsibilities together. Mr. Ryan asked if this was legal advice. Mr. Lewin responded that he would not give legal advice to this board. Mr. Lewin inquired as to whether applications already on file would be required to be resubmitted. Ms Balzarini responded that if people have already submitted an application, they should not have to re-submit. Mr. Lewin expressed concern on the water credits and that they were not a good thing. Mr. Lewin commented about the review of the public documents. He considers it a fiasco that the City allowed SME to look over the documents, it just shows the kind of activity going on. He feels that any time there is public business happening it is public information. Mr. Lewin left the meeting immediately after speaking.

Ed McKnight, 906 3rd Ave N, commented that the water credits were a good thing because they were money we owe at 0% interest. Mr. McKnight stated the water credits applied to Block 1 energy only. Mr. McKnight stated that Block 2 and Block 3 energy contracts did not include water credit provision.

Ms. Balzarini responded that the water credits are for Block 1 energy. The settlement of energy imbalances is applied to the various Blocks on a pro rata basis. Block 1 unused energy is now being sold into the imbalance market at a higher rate than it is being purchased for.

Richard Liebert, 289 Boston Coulee Road, commented on conservation vs. consumption of energy. Mr. Liebert submitted an ad from the Great Falls Tribune recruiting wind technicians; an ad for the T. Boone Pickens energy plan; a spreadsheet that he had provided previously to Mr. Gregori for information; and an article Field Garbage-To-Energy Tested In Iraq. Mr. Liebert stated that citizens are being contacted directly by SME attorneys.

Neil Taylor, 3417 34th Ave S, submitted a spreadsheet that he had provided previously to Mr. Gregori for information.

Larry Rezentes, 2208 1st Ave N, stated that he appreciated the monthly financial reports. Those documents with the City budget show that a loss is expected this year. Mr. Rezentes commented that if HGS is not built, how is the water credit to be repaid. Could SME take the $1.4 million deposit to cover the debt?

Ron Gessaman, 1006 36th Ave NE, stated that according to ECP by-laws, in the event of a vacancy a new member is to be appointed within 30 days. Mr. Gessaman asked what action has been taken by the City from when the City put the discussion of level of participation in HGS on hold for 30 days. Mr. Gessaman submitted an article Rock Port, Missouri, First 100 Percent Wind-powered Community In U.S.

Ole Stimac, 57 County Lane, stated that energy equals economic growth. Mr. Stimac discussed projects that were not done because regions could not provide enough energy.

Ron Madsen, 122 Treasure State Dr, agreed that growth is important. Mr. Madsen stated that the predictions show growth is in alternative energy.

Kathy Gessaman, 1006 36th Ave NE, inquired as to when the contracts with the current customers are finished, what rates will the customers be charged. Ms. Balzarini explained that the current contracts with the customers have price increases, for the most part, on all customers annually.

BOARD MEMBER REPORTS

Vice-Chair Willey’s resignation was presented. She stated that she would stay on another month to accommodate the will of the Board. All members expressed their appreciation for her remaining.

Mr. Ryan requested that audio equipment be available for the next meeting. There was a discussion about moving the meeting into the Commission Chambers where audio equipment is available.

ADJOURN: Mr. Pancich moved, seconded by Mr. Ryan to adjourn the meeting. Chairman Golie adjourned the meeting at 6:50 PM. The next meeting is set for September 8, 2008, at 5:30 PM in the Gibson Room or the Commission Chambers if they are available in the Great Falls Civic Center.