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HomeMy WebLinkAbout10-10-2022547 Safety Moment Consent Agenda Receipt and Filing of Audit Report for FY 2022 ber 10, 2022 The Electric Plant Board of the City of Paducah, Kentucky d/b/a Padu r System ("PPS') held a regular Board Meeting on October 10, 2022, in the :rence Room at the offices of Paducah Power System. The meeting was called to order at 12:00 p.m. by Chairman Ed Hely who led. Members of the Electric Plant Board present in addition to Chairman were Hardy Roberts, Mark Workman, Sandra Wilson and Darryl Pea. PPS >yees present were Dave Carroll, Rick Windhorst, Andrea Underwood, Doug ley, Eileen Miller, Brian Thomasson, and Sarah Durbin. David Snow Bob Wrinkle and Abby Wrinkle (Northwestern Mutual), and Plant Board attorney, Kent Price (McMurry & Livingston), also attended the meeting. Chairman Hely opened the meeting by calling on Brian Thomasson who this month's Safety Moment on "The Importance of Asking Questions." Member Wilson then offered a motion, seconded by Member Roberts, to approve the Consent Agenda which consisted of (i) minutes of a regular meeting of the Electric Plant Board held on September 12, 2022; (ii) Amendment No. 2 to the Market -Based Interruptible Customer Service Agreement with Solminer Farm LLC; and (iii) a revised tariff for General Power Rate Schedule —Outside Lighting. Doug Handley and Eileen Miller then addressed questions from Chairman Hely concerning the anticipated effects of the proposed amendments to the Service Agreement with Sohniner Fames, LLC and the security arrangements for the account. The motion was then adopted unanimously with all members saying aye. Member Roberts then offered a motion, seconded by Member Wilson, that the Audit Report prepared by Williams, Williams & Lentz for fiscal year 2022 be received and filed as submitted. Doug Handley reported that the Audit Report presented a clean opinion on the Electric Plant Board's financial statements, noting that the auditor made no adjustments other than the calculation of pension liability which is customarily performed each year. Mr. Handley informed the Board that this was the seventh consecutive year that Williams, Williams & Lentz had performed the audit and that as a matter of prudent JAN 2 4 2023 CITY CLERK 548 etober 10, 2022 financial practice, a different firm would be selected to perform the audit for the ext three years. The City of Paducah has issued a Request for Proposals for firms o perform the PPS audit for the three-year term. Mr. Handley stated that he expected that Williams, Williams & Lentz would be selected by Kentucky Municipal Power Agency (KMPA) to perform its audit for the next three years. He also expects that at the end oftheir respective three-year contracts, PPS and KMPA will rotate the firm providing auditing services to each of them. The motion was adopted unanimously with all members saying aye. Member Workman then offered a motion, seconded by Member Wilson, that (i) the Electric Plant Board establish a 401(a) Retirement Plan for Tier 3 Establishment of a 401(a) Retirement Kentucky Retirement Systems members employed by Paducah Power System with Plan for Tier 3 Employees an annual 4.75% company contribution each January, beginning in January 2024, and a catch-up contribution of approximately $260,287 made in January 2023 calculated on actual payroll through calendar year 2022; and (ii) that the CEO and Director of Human Resources & Community Relations be authorized to sign any and all documents necessary to implement said 401(a) Retirement Plan. PPS CEO, Dave Carroll, then made a PowerPoint presentation explaining how the proposed 401(a) retirement plan grew out of the 2021 Strategic Plan emphasis on Workforce Development and was needed for PPS to attract and retain qualified workers, particularly linemen. Mr. Carroll described the other options that had been explored to achieve the workforce development purposes, such as withdrawing from the Kentucky Retirement Systems, and why such options were determined not to be viable. He then presented a description of the 401(a) retirement plan that is being proposed, how the retirement plan would work, and the financial commitments that PPS would have to make over time to implement and administer the plan. Mr. Carroll and Andrea Underwood, Director of Human Resources & Community Relations, then addressed a number of questions from Board Members concerning the proposal. Chairman Hely then introduced Bob Wrinkle and Abby Wrinkle of Northwestern Mutual which would serve as the Investment Advisor 549 Report on PPS e - Scrap Collection Day Power Cost Adjustment for Upcoming Quarter Carbon Capture & Sequestration Project October 10, 2022 for the 401(a) plan. After Bob Wrinkle made remarks describing the services that would be provided by the Investment Advisor, the motion was adopted unanimously with all members saying aye. Chairman Hely then called on Andrea Underwood who reported on the e - Scrap collection held on October 3, 2022 as part of the annual Public Power Week activities. Ms. Underwood noted that 40 pallets of a -Scrap were collected that day and that the participating members of the public express great appreciation for the service provided by PPS. Dave Carroll then reported on the Power Cost Adjustment (PCA) calculation for the upcoming quarter. He announced that the PCA is presently a credit on customer's bill of approximately $0.005/kwh and that the credit will double to over $0.01/kwh for the next quarter. Mr. Carroll stated that for a PPS customer with average power use the expanded PCA credit would amount to about a 6.4% decrease in his or her power bill (equivalent to about $10.36/month). He attributed the expanded PCA credit to the higher power sales revenues that the Prairie State Energy Campus plant has been realizing. Mr. Carroll expects the expanded credit to persist at least through the fiscal year 2023. W. Carroll then announced that the 45Q tax credits enacted as part of the Inflation Reduction Act appear to make viable a Carbon Capture & Sequestration (CCS) project at the Prairie State Energy Campus (PSEC). PSEC plans to issue a Request for Proposals for a third party which would build and operate a CCS facility that would capture the carbon dioxide emitted by one of the PSEC units and impound it underground. He noted that the costs of the CCS facility would be home by a third party with whom PSEC would contract. Accordingly, neither KAVA nor PPS would be required to invest capital in the project. If such a CCS facility becomes operational at PSEC, it would help PSEC comply with the recent Illinois legislation requiring a 45% reduction of carbon dioxide by 2035. 550 lOctober 10, 2022 Workman next offered a motion, seconded by Member Wilson, that the Adjournment meeting of the Electric Plant Board be adjourned. The motion was adopted with saying aye, whereupon the meeting was adjourned. ME t, .TTESTED BY: