October 13, 2011
The regular meeting of the Board of Directors of the Omaha Public Power District was held in the Board Room on the Atrium Level of Energy Plaza East on October 13, 2011, at 10:00 a.m.
Present were Directors M. J. Cavanaugh, N. P. Dodge, J. K. Green, A. L. McGuire, L. Scheve, J. R. Thompson, F. J. Ulrich, and D. D. Weber. Also present were W. G. Gates, President and S. M. Bruckner and T. Meyerson, General Counsel for the District. Mr. Green, Board Chair, presided, and Ms. Emerson, Corporate Secretary, recorded the minutes. Other members of Management present were D. J. Bannister, T. J. Burke, M. I. Doghman, E. E. Easterlin, J. T. Hansen, S. L. Hutcherson, T. A. Burton, G. A. Krieser, T. G. Tamke, J. J. Hanson, and M. R. Jones. Others present included J. Petr, M. Welsch, R. Miller, and several other customer owners.
The Corporate Secretary read the following:
“Notice of the time and place of this meeting was publicized by notifying the area news media; by publicizing the same in the Omaha World-Herald and Outlets; by displaying such notice on the Arcade Level of Energy Plaza since October 7, 2011; and by mailing such notice to each of the District’s Directors on that same date.
“A copy of the proposed agenda for this meeting has been maintained, on a current basis, and is readily available for public inspection in the office of the District’s Corporate Secretary.
“Additionally, a copy of the Open Meetings Law is available for inspection in the public meeting book located in this meeting room.”
It was moved and seconded that the Board reviewed the August 2011 Comprehensive Financial and Operating Report and that the minutes and the approved absences of Directors Cavanaugh and Ulrich for the last meeting be approved. The vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Abstain; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
Thereafter, the Corporate Secretary read the following:
“Persons wishing to address the Board on a particular item are asked to approach the microphone as that agenda item is discussed. Comments will be heard following Board discussion of the item and prior to a vote by the Board. Persons wishing to address the Board on all other matters will have an opportunity before the close of the meeting.”
The next order of business was the Board’s consideration to approve amendments to Resolution No. 1788.
The Corporate Secretary read a motion to dispense with the reading in full of Resolution No. 5882 as follows:
“BE IT RESOLVED THAT, because a copy of Resolution No. 5882 has been furnished to each Director in advance of this meeting, the reading in full of the Resolution in this meeting by the Secretary be dispensed with except for those portions of the Resolution which have been materially revised and the additions necessary to complete said Resolution.”
It was moved and seconded to dispense with the full reading of RESOLUTION NO. 5882. The vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Yes; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
Following the preceding vote, Board Chair Green called upon Mr. John Petr, a partner with Kutak Rock, the District’s Bond Counsel, for changes to Resolution No. 5882. Mr. Petr confirmed there have been no material changes to Resolution No. 5882 since its distribution to the Board.
Director Thompson indicated that management is recommending amendments to Resolution No. 1788 to allow the District to invest in the same government securities that were allowable prior to Standard & Poor’s Rating Services (S&P) recent downgrade of U.S. government securities. S&P’s rating action is negatively impacting the District’s investment earnings by limiting current investment opportunities in government agency securities.
Chairman Green called upon the Mr. Bruckner to provide the legal opinion. Mr. Bruckner indicated his firm has reviewed Resolution No. 5882 which amends provisions of the District’s Senior Lien Bond Indenture, and it is in proper form for approval by the Board of Directors. Following the discussion, the vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Yes; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
The following resolutions were then read, and upon motion duly seconded, were placed on roll call. The vote on each resolution is indicated following the description of that resolution.
RESOLUTION NO. 5883 authorizes award of a contract for site grading, drainage, and erosion control and miscellaneous improvements at the future Substation 1366. Committee Chair Cavanaugh indicated that the new substation will support continued growth and development in the southeast Sarpy County area. Two proposals were received. Both proposals are legally and technically responsive. The Engineer’s Estimate is $1,250,000. Following the discussion, the vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Yes; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
RESOLUTION NO. 5884 authorizes management to negotiate and award a contract for managed task and supplemental craft labor services at OPPD’s generating station. Committee Chair Cavanaugh indicated that the District intends to award a multi-year contract to supply supplemental workers for maintenance and equipment projects at OPPD generating stations. Many of the projects planned at the generating stations are large and complex requiring detailed planning and highly skilled and trained craft workers capable of working safely and efficiently in the plant environment. A limited number of contractors have the capability to provide qualified supervisors and other professionals for complex nuclear and fossil managed task projects. In order to effectively contract for the performance of these complex projects, it is important that OPPD has the ability to openly communicate with potential contractors in the bidding process. The total estimated value of this contract is $66,000,000 for the first three years. Director Ulrich inquired if there would be additional years involved with this contract and Vice President Hansen indicated the contract would include five 1-year extensions to begin after the initial three years, for a total of 8 years. Director McGuire asked if this is a different contract than the NPS Day Zimmerman contract, and Mr. Hansen said the contract will be essentially the same as with NPS Day Zimmerman, but an additional objective is to receive a better value from the vendor as well as incentives and damages for unacceptable work. Following the discussion, the vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Yes; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
RESOLUTION NO. 5885 authorizes management to enter into agreements with the Nebraska City Utilities for the construction, operation, and maintenance of the natural gas supply to the Nebraska City Station. Committee Chair Cavanaugh indicated that providing a natural gas fuel supply to the two units at Nebraska City Station has environmental benefits and can provide reduced fuel costs for startup, shut downs and operational stability for the boiler. OPPD has entered into discussions with Nebraska City Utilities (NCU) that will mutually benefit both entities. An agreement has been prepared for OPPD to participate with an addition to the NCU system. This will require NCU to serve natural gas transportation to OPPD, define operations and maintenance responsibility, and assign OPPD the responsibility for the construction process. NCU will secure all easements for the gas line. Ownership of the gas line will be transferred to NCU for long term operation and maintenance. OPPD will retain natural gas transportation rights. The project has been budgeted and is scheduled for completion in 2013. Vice President Hansen added the line is not large enough to provide natural gas for all plant operations, and will be used mainly for plant startup. He also said the District will realize a $2 to $4 million savings per year with the addition of the gas line. Director Ulrich added that other customers such as farmers will be able to use the line and will be a benefit to Otoe County.
Following the discussion, the vote was recorded as follows: Cavanaugh – Yes; Dodge – Yes; McGuire – Yes; Scheve – Yes; Thompson – Yes; Ulrich – Yes; Weber – Yes; and Green – Yes. The motion carried.
Copies of the foregoing resolutions are filed in the District’s Corporate Records file.
The next item of business was the opportunity for those in attendance to address the Board on any items of District concern.
Mr. Mark Welsch, of 5611 Howard Street, Omaha, NE, addressed the Board of Directors on the activities of the Nebraska Chapter of 350.org. Mr. Welsch’s handout to the Board is attached.
There being no further business, the meeting adjourned at 10:22 a.m.
J. T. Hansen D. S. Emerson
Assistant Secretary Corporate Secretary