Continuing to safely, efficiently and effectively execute projects
Arch Staffing and Consulting Change Order: $3.75M
November 2020
Powering our way of life.
Goal
Find the
Balance of
Capacity and
Capability
Project demand peaks
Overall project management
Specific project needs
Capability
Find the correct resource balance by
determining organizational capacity needs
while increasing EPMO capabilities.
Tools to
Achieve
Goal
Find the
Balance of
Capacity and
Capability
Organization resource loading
Contracted resources
Capacity
Leverage existing EPMO Team members
Standardized project management
framework (v1 EOY)
Contracted resources
Current
Contracted
Personnel
Named
Resources
Rachelle McGillivray
Power Engineers
ESRI/GIS Project
(until E0P)
David Poulin
TMG Consulting
CCS Project
Dec 2020
(until EoP)
Brent Gregory
Arch Staffing and
Consulting
Project Management
Framework and misc.
project support
Dec 2022 (+)
Cliff Woods
Arch Staffing and
Consulting
Ephrata and Moses
Lake Service Centers
Dec 2022
(until EoP)
Ben Floyd
White Bluffs
Consulting
Facilities Master Plan
Dec 2021
(until EoP)
Thomas Karcz
Arch Staffing and
Consulting
OCM Program
Dec 2022 (+)
Ann Shiveley
VOLT
OCM project support
May 2021 (+)
Contracted
Personnel
To Be Named
Resources
Name
Consulting
Firm
Project
Estimated
Duration
EPMO 1
TBD
Project Control Services
Dec 2022 (+)
EPMO PD 1
TBD
OSS/BSS (Fiber tech) project
TBD (EoP)
EPMO PD 2
TBD
ECBID project
TBD (EoP)
EPMO PD 3
TBD
Invenergy project
TBD (EoP)
EPMO PD 4
TBD
Project Development –
NLL/Interconnect
Dec 2022 (+)
EPMO ET
TBD
Remaining HCMS modules
Dec 2021
EPMO ET
TBD
ET program support
July 2021 (+)
EPMO PP 1
TBD
PM for specific project being
determined
TBD
EPMO PP 2
TBD
PM for specific project being
determined
TBD
EPMO PP 3
TBD
Project Coordinator for specific
project being determined
TBD
EPMO PP 4
TBD
Project Coordinator for specific
project being determined
TBD
EPMO PP 4
TBD
Project Coordinator for specific
project being determined
TBD
Additional contracted needs to be determined on a project-by-project basis.
Contracted
Personnel
Potential PP
Projects for
Contracted
Resources
WAN/PR Station Service
2020
CO2 Replacement
2021
Maintenance Equipment Storage at WMC
2021
Power Production Tag in/Tag out System
2021
PRP Control Room Renovations
2021
WAN Bridge Cranes
2021
WAN Fish Ladder
2022
PR Fish Ladder Rehabilitation
2022
PR Hatchery Siphon Intake Renovation
2022
PR Warehouse
In progress
PR Right Embankment Improvement Project
In progress
PR Turbine Generator Rehab Project
In progress
Contracted
Personnel
Approach to
Acquire
Current: $2,250,000
Proposed: $6,000,000
(Increase by $3,750,000)
Arch
Current NTE: $2,350,000
VOLT
$600,000 for EPMO
AvanTech
To be identified on a project by project basis
Other
Find the right resource with the desired
capabilities for the project
Safety Report
November 2020
11
DAT E
INJURY
DESCRIPTION
CAUSES
PREVENTION
10/1/2020
Abrasion/Contusion
While working in W10 Turbine pit removing upper wicket
gate canisters an employee mis-stepped and slipped on the
surface of a wicket gate link arm resulting in a large
contusion and abrasion on their right thigh.
Poor walking
working surface
Complete an ongoing project to
install grating to walk on.
10/8/2020
Insect Sting
An employee was stung by a Yellow Jacket while setting up
COVID-19 testing.
Environmental
???
10/23/2020
Strain/cold weather
Employee didn't notice injury until the next day. Right wrist
was tender and had a bump on top of forearm, probably
tendonitis caused by overexertion and cold weather.
Overexertion
Stretch and flex prior to
exertion.
Monthly and Year to Date
2020
Month
YTD
Total Incidents Reported
3
26
Recordable Case(s)
1
4
Restricted Duty Case(s)
0
3
Date
Vehicle
Driver’s Account:
Prevention
10/15/2020
#337
Vehicle 337 was traveling north to Wanapum dam on Highway 243 near the
RR bridge. Suddenly the driver side window exploded as they passed an
apple truck traveling the opposite direction. The crew did not observe any
objects strike the vehicle's driver side window. No employees were injured.
???
10/21/2020
#504
While backing #504 out of Bay #1 the struck #494 in the front bumper with
the trailer hitch. A 360 walk-around was conducted with the bay door closed
not knowing that truck #494 had parked outside the door. The Bay door was
opened from inside the vehicle and could not see #494 parked behind using
the side mirrors. Vehicle speed was about 1 mile per hour.
Situational Awareness
10/23/2020
PT55
During operation of PT55 (District boat) in the Hanford Reach PT55 came
into contact with another boat during a fish transfer. The incident occurred
while pulling away (under low power) and the rear corner of PT55 struck the
side of an angler's boat causing minor damage (small dent and damage to a
decal). No injuries occurred and PT55 was not damaged.
Close Calls
Date
Location
Description
10/1/2020
Wanapum
Dam (W4)
It was identified that an isolation valve for the Brake Air Supply had been left CLOSED after the
Clearance Tag had been removed. This gave a false indication at the Governor Cabinet that the
Brakes were APPLIED when in fact only the piping to the brake isolation valve had been energized.
The valve did not have an identification label.
10/26/2020
Wanapum
Dam (W4)
The control room received a Field Ground Relay Indication for W04. Upon investigation, it was
discovered that a large cold metal chisel had been left inside the generator following installation of
the fairing covers during assembly for the commissioning overspeed inspection. The chisel appears
to have been making contact on a field pole connection causing indications of a ground and could
have caused catastrophic damage to the W04 generator.
10/27/2020
Quincy Chute
During winter clearance preparations, a water gate was inadvertently left open, and a tag incorrectly
placed. The error was not noticed by the fist proposed clearance holder but found by the secondary
check of the second clearance holder. The gate was closed, and the clearance was corrected.
Date
Location
Description
10/2/2020
Blue Lake
PUD contractor was excavating on private property and hit a unlocated private power conduit. There was no power outage, and
the conduit was scuffed. A third party locate company was called to locate the property prior to excavation.
10/14/2020
Quincy Area
A PUD Contractor while excavating discovered what appeared to be some type of explosive device. The Authorities were
notified, and the area evacuated. Once the authorities were on site the Washington State Patrol Explosive Technicians were
called in to evaluate the situation. Three used/spent blasting caps were identified as possibly being left from a previous
excavation. No injuries were reported, and the site was evaluated for any other materials that may have been left. None were
found.
10/20/2020
George Area
A PUD contractor working at the intersection of Baseline and Road T located in in George experienced a close call when a
Semi-Truck traveling along Baseline began approaching the work zone. The flagger recognized the truck was not slowing down
and alerted the crew to get off the road. The truck lost it’s brakes and drove by the flaggers stop paddle and into the work zone
without slowing down. The truck was able to stop after going through both flaggers and the work zone and then pulled to the
side of the road.
10/21/2020
Ephrata Area
A PUD Contractor crew was trenching from the pole to a residences home in Ephrata with a mini excavator when they damaged
a secondary neutral line. The incident occurred approximately 3 ft off locate. The damage of the secondary neutral line was a
small portion of the coating being peeled back. PUD was notified, and fixed the damage.
Contractor Close Calls & Incidents
Date
Location
Description
10/22/2020
Mountain View
Substation
A PUD Contractor was digging along the side of a foundation and at a depth of approximately 18” and hit the 1” fiber
conduit breaking the fiber line inside and immediately ceased excavation. The fiber line had previously been exposed
and rerouted to facilitate foundation installation. The crew momentarily lost focus regarding current location of the
fiber duct. The fiber line had been previously located and marked by the District. The District was immediately notified
by the contractor and the damaged fiber was repaired expediently.
10/27/2020
HWY 283
A PUD Contractor was returning from work at Cave B to the Ephrata yard on Highway 283. As they approached Kriete
road the driver dozed off and temporarily left the roadway creating a cloud of dust. The pickup was pulling a trailer
with a spool of fiber behind them. The employee called the Supervisor immediately to report the incident. There were
no injuries or visible damage to the equipment.
Level O - Other – Close Call
Level 1 – Serious Close Call
Level 2 – First Aid Case(s)
Level 3 – Recordable Injury Case(s)
Level 4 –Restricted Duty Case(s)
Level 5 – Lost Work Day Case(s)
Level 6 – Fatality or Hospitalization
19
0
2
0
0
0
0
2020
11
Recordable
Cases TTL.
2019
67
7
11
0
8
5
7
20
Recordable
Cases TTL.
Level O - Other – Close Call
Level 1 – Serious Close Call
Level 2 – First Aid Case(s)
Level 3 – Recordable Injury Case(s)
Level 4 –Restricted Duty Case(s)
Level 5 – Lost Work Day Case(s)
Level 6 – Fatality or Hospitalization
74
12
4
4
3
4
0
Other SST members include:
Bryan Mickle, Chris Heimbigner, Craig Bressan, Darlene Brooks, Gavin Clark, Jeff Grizzel, Randi Hovland, Rich
Wallen, Ryan Roeder, Val Hernandez, and Wade Johns
contaminated with COVID-19.
2. Safety
notifies Security/DSOC and Public Affairs
hotline that a building must be shut down for
cleaning.
3. Security
will hang signs and disable access to the
building.
4. Public Affairs Communications
is contacted by
Safety @ (509) 754-5035 and requests notification of
building closure to District employees.
5. Safety
contacts Mike Harr or Lori Thorpe requesting
the building to be sanitized.
4. Contractor
sanitizes affected building and notifies
Mike Harr or Lori Thorpe when complete.
5. Internal Services
notifies Safety and Public Affairs
Communications that the building has been sanitized
and arranges for reopening and communication to
District employees.
Safety Action Item Critical Success Factors
Incident Reporting (Date of Entry into System vs Data of Distribution
Systemwide)
• Number of Close Calls in
October
= 11
• Number of Close Calls sent Next day after being entered into the system = 3
Number of Open Action Items over 60 days old
As of
September
2020
As of
October
2020
Year 2017 = 9
Year 2017 = 7 (-2)
Year 2018 = 11
Year 2018 = 11
Year 2019 = 28
Year 2019 = 26 (-2)
Year 2020 = 12
Year 2020 = 11 (-1)
Month Total =
60
Month Total =
55
Incident Reporting for October 2020
(Date of Incident vs. Date of Entry into System)
• Total Number of Injuries Which Date of
Incident and Date Entered into System
Match = 2
Mobile
• Total Number of Mobile Incidents = 3
• Total Number of Mobile Incidents that Date
of Incident and Date Entered into system
match = 1
Powering our way of life.
This Photoby Unknown Author is licensed under CC BY-ND
Grant PUD Health Screening Policy v.4
This revised policy establishes new symptom reporting guidelines and testing requirements for the
purpose of mitigating the spread of the COVID-19 virus among Grant PUD employees and
contractors.
Why is it Important?
• We care about the safety of our employees and strive to ensure we have the measures in place to
effectively minimize transmission of the disease.
• An effective symptom reporting, testing, and quarantine program helps us identify employees who
are positive early in the disease progression.
• Our COVID-19 safety program allows us to prevent more infections and slow the rate of
transmission within the PUD.
• Employee adherence to these requirements aligns with our core values and Grant PUD’s ability to
provide critical services to our customers.
This Photoby Unknown Author is licensed under CC BY-ND
HR-BC-POL-315 – GRANT PUD COVID-19 HEALTH SCREENING
Symptom reporting
Report any of the following symptoms of COVID-19 per new CDC guidelines:
•
Fever or chills
•
Cough that cannot be attributed to another health condition
•
Shortness of breath or difficulty breathing
(not attributed to another health condition)
•
Fatigue
•
Muscle or body aches
•
Headache
•
New loss of taste or smell
•
Sore throat
•
Congestion or runny nose
•
Nausea or vomiting
This Photoby Unknown Author is licensed under CC BY-ND
Health Screening Reporting Requirement
Any Grant PUD employee or contractor
covered under this policy must immediately notify their
supervisor or District Representative if they have:
1) tested positive for the COVID-19 virus, or
2) are experiencing COVID-related symptoms, or
3) have been in Close Contact
(
within 6 feet of an infected or
symptomatic person for a total of 15 minutes within a 24-hour
period)
with someone who has tested positive for
COVID-19 or who has COVID-related symptoms.
Supervisor or District Reps must contact the
IMT COVID
Reporting Group at 509-754-1805 or x4111.
Please
call the
HOTLINE
, not an individual Safety Coordinator!
Direction will then be provided for any necessary
subsequent actions.
This requirement applies to all Grant PUD employees
and contractors, including those working from home.
Self-Monitoring When Arriving at
Work & While at Work
•
Take your temperature and check your symptoms prior
to leaving for work.
•
If you do not have access to a thermometer at home,
you must take your temperature at the nearest Grant
PUD facility sign-in location. Those who commute more
than 1 hour from their work location must retake their
temperature when they arrive at a Grant PUD facility.
•
While at work, Grant PUD employees and contractors
must monitor themselves for any changes in their
physical condition that might suggest the onset of
COVID-19.
HR-BC-POL-315 – GRANT PUD COVID-19 HEALTH SCREENING
Mandatory Testing Requirement
Employee health and safety is a core value. Testing helps us keep us safe!
Employees who fit one of the following criteria will be required to provide proof of COVID-19 testing:
• Employees who are experiencing COVID-related symptoms
• Employees who have experienced a Close Contact
(within 6 feet for a total of 15 minutes or more within a
24-hour period)
with someone who has related symptoms or with a confirmed case of
COVID-19.
• Employees who have been asked or referred to get tested by their healthcare provider or their local
or state health department.
Other considerations:
•
Persons living in the same household as a Grant PUD employee and who are experiencing COVID-related symptoms but who have
not been tested are presumed to be COVID-19 positive.
•
Grant PUD cannot and WILL not require a non-employee to be tested for COVID-19.
•
Grant PUD’s authority to require testing for employees who are symptomatic or who have experienced a close contact is based on
guidance provided by the federal Equal Employment Opportunity Commission (EEOC).
Disciplinary Action – Employees
• Employees who fail to adhere to these requirements will be subject to disciplinary action. Any full-time
regular employee who meets one of the testing criteria above but fails to provide proof of testing will
receive a written warning and will be required to use Personal Leave for the balance of their
quarantine period not covered under the Families First Coronavirus Response Act.
• Any full-time regular employee who violates the mandatory testing provisions a second time will be
terminated.
• Any temporary employee who meets one of the testing criteria but fails to provide proof of testing will
be terminated.
Notes:
•
Discipline will be carried out in accordance with Grant PUD’s policies and procedures.
HR-BC-POL-315 – GRANT PUD COVID-19 HEALTH SCREENING
Use of Paid Leave
Grant PUD will authorize paid leave under the Families First Coronavirus Response Act Policy for employees
under specific circumstances. Paid leave will be authorized for an employee who:
Has tested positive for COVID-19;
•
Has experienced COVID-related Symptoms (see Symptoms list above), has undergone COVID-19 testing,
and has provided proof of testing; or
•
Has experienced a Close Contact with someone who has COVID-related symptoms or with a confirmed case
of COVID-19, has undergone testing and has provided proof of testing.
Disciplinary Action - Supervisors
Supervisors
- Supervisors who has/had
knowledge
of and fails to report
an employee who has experienced a close contact or who is showing
COVID-related symptoms will also be subject to disciplinary action.
Any supervisor who fails to report will receive a written warning and will be
placed on Leave Without Pay for 80 hours. Any supervisor who fails to
report a second time will be terminated.
Powering our way of life.
Powering our way of life.
Commission Meeting
11/24/2020
Proposed 3-Year
20% Slice Sale
Items for Discussion
Rich Flanigan, Sr. Manger of Wholesale Marketing and Supply, Grant PUD
•
Tie to Strategic Plan
•
Proposed Slice Details
•
Indicative RFP Process
•
Non-carbon Language
Counterparty
Size
2021
2022
2023
2024
Avangrid Slice
10%
Morgan Stanley WSS
33%
Proposed Shell Slice
20%
2025
YEAR
Slice Attributes tie to Strategic Plan
•
Consistent with Strategic Plan Objectives
•
Maintain a Strong Financial Position
•
Revenue certainty (eliminates water risk)
•
Strong premium for ancillary services
•
Favored by bond rating agencies
•
Provide Long Term Low Rates
•
Insulates Grant from hydro variability (operational risk)
•
Maximizes value of Grant Hydro capacity, flexibility, energy, and
•
10% 3-year slice of Priest Rapids Project Output
(PRPO) to Shell Energy North America
•
Starting date of 01/01/2021
•
Ending date of 12/31/2023
•
Current 53.31% PRPO Wholesale Service Slice with
Deal Structure
•
Very similar to the terms of the current contract
•
Shell is entitled to the following attributes
•
Energy
•
Capacity
•
Pondage
•
Ancillary services
•
Green attributes
(language included to protect under new carbon legislation)
•
Dynamic signal (allows for in-hour energy changes)
•
The indicative RFP process was broken down into three (3) phases;
•
1.Phase I – Initial interest and bidding for a 20%, 3-year slice of PRP
•
2.Phase II – Indicative bidding round from interested bidders from Phase I
•
3.Phase III – Bilateral negotiations with top bidder from Phase II
•
The indicative RFP process was structured as a 20% slice of PRP with a fixed
volume of energy being returned (“buy-back”) to the District
•
Fixed energy buy-back shaped to Grant’s load
•
Energy “buy-back” was used to isolate the premium for the additional
attributes from PRP (green attributes, ancillary services, regulation, etc.)
and help staff make an apples-to-apples comparison between each bid
Contract Overview
8
•
Contract work with Winning Bidder
•
Used the existing Avangrid 10%, 3-year contract as the initial template
•
Review from internal council for legal compliance
•
Large internal stakeholder reviews
•
Finance
•
Accounting
•
Dispatch
•
Control Systems Engineering
•
Financial Planning and Analysis
•
Compliance
•
Part of final bilateral negotiations included new
contract language for Non-carbon Energy
•
Language is structured to provide Grant protection from
any new legislative carbon fee or tax
•
Option for Grant to receive non-carbon energy if Grant is
1
FROM:
John Mertlich, Sr. Mgr Financial Planning & Analysis
Jeremy Nolan, Lead Financial Analyst
SUBJECT:
3
rdQuarter 2020 Financial Forecast Update
Purpose:
Provide Highlights of the Q3 Financial Forecast
Metrics:
The District has in place interim and long-term annual target milestones for five financial metrics
through 2025 (Exhibit C).
Over the 5-year forecast (thru 2025) the current metrics indicate (Exhibits A & B):
o
The following long-term targets are met through 2025 for:
Liquid Cash >$105 Million,
Debt to Net Plant < 60%, and
Debt Service Coverage > 1.80x
o
Return on Net Assets does not meet the interim or long-term targets thru 2025.
o
Retail Operating Ratio (ROR) meets the interim target in 2020, but does not meet the
interim or long-term targets from 2021 through 2025.
Comparisons between the 2020 Budget and Q3 2020 Forecast can be found in Exhibit D.
Debt to Net Plant Illustrative Example – Historic Cost vs Fair Market Value comparison found in
Exhibit H.
Notes of Interest:
Key forecast updates:
o
Interest rates updated for current market impact on Interest Income.
o
2020 Labor, O&M, and Capital updated for Q3 actual data and balance of year
projection. Forecast for 2021 and beyond is the same as 2021 Budget.
o
Cash Optimization was executed in Jan. 2020 and additional debt refunding in March
2020.
Load Forecast and Retail Revenue have been updated for Q3 actual data. Forecast for the
balance of 2020 and future years is the same as 2021 Budget.
o
Retail Revenue rate adjustment assumption is: 0.1% annually beginning 2021.
o
EUDL CRAC Revenue moved to begin after 2030 instead of 2021. The table below
shows the revenue that was in the 2020 Budget and 2020 Q1 forecast that was
removed for the Q2 Financial Forecast.
2
Scenarios:
All scenarios start with the Base assumptions
Five Scenarios were run for the 2020 Q3 Forecast:
o
Wholesale Price Increase (P85)
o
Wholesale Price Decrease (P15)
o
Low Load Growth at ½ Base
o
Low Load Growth at ½ Base and Wholesale Price Decrease (P15)
o
Low Water (P15)
Scenarios and Debt Service Coverage (Exhibit E)
o
Debt Service Coverage (DSC) is adversely affected in all scenarios through 2025 except
higher wholesale energy prices and some years with low load growth at ½ base.
o
Low Load growth scenario when combined with low wholesale energy prices and the
Low Water scenario create the two largest negative impact to DSC, indicating that
growing profitable loads and reducing Water risk are key controllable business drivers.
Scenarios and Debt to Net Plant (Exhibit F)
o
Debt to Net Plant is adversely affected in all scenarios through 2025, except higher
wholesale energy prices and low load growth at ½ base.
Scenarios and Return on Net Assets (Exhibit G)
o
Return on Net Assets is negatively affected by all scenarios through 2025, except higher
wholesale energy prices and low load growth at ½ base.
o
Return on Net Assets fails to meet the interim or long-term target though 2025.
Conclusions and Path Forward:
Growing profitable loads is a key controllable business success driver.
Lower wholesale prices combined with low load growth are a threat in the 2020-2025 period.
Recommendation:
4
6
8
10
M E M O R A N D U M
November 6, 2020
TO:
Kevin Nordt, General Manager/CEO
VIA:
Jeff Bishop, Chief Financial Officer
FROM:
Michael Facey, Senior Manager Accounting
SUBJECT:
Unaudited Financial Statements Third Quarter 2020
Financial Highlights:
All comparisons unless otherwise stated are year to date (January through
September) of 2020 versus 2019.
Statement of Revenues, Expenses and changes in net position:
o
Total operating revenues of $244.5M were $5.2M (2%) higher than the same period in
the prior year driven by a $9M (18%) increase in Wholesale revenues and a $2M (10%)
increase in Irrigation; partially offset by a $1.8M (8.4%) decrease in Sales to power
purchasers at cost, a $4.6M (3.4%) decrease in all other retail revenues. Overall retail
load was down 5.3% from budget, primarily due to Commercial, Industrial, Large
Industrial and Evolving Industry loads. Commercial experienced milder weather
conditions and some impacts from COVID-19 unemployment rates, which were 3%
higher than the prior year. Remaining load deviations were primarily due to some
individual large customers experiencing substantial reduced loads and others moving to
different rate schedules. Residential revenue decreased from the prior year by $1.4M
(4%) due to milder winter weather (average 26% degrees warmer than the prior winter).
The increase in irrigation is due to changes in weather from the prior year, noting a 78%
reduction in precipitation. The overall decrease in retail revenues drove the increase in
wholesale revenues because the District receives market prices when actual retail load
is lower than forecasted through the SENA & Morgan Stanley agreements.
o
Total operating expenses of $162M were $7.1M (4.6%) higher than the same period in
the prior year. The overall increase in operating expenses is largely due to the new CBA
Agreement, which increased wages an average of 5% in 2020. Depreciation expense
increased $2M or 3.6% largely attributed to a $77M or 3.6% increase in net utility plant.
Within operating expenses there are significant fluctuations within expense categories
as follows: Distribution expense ($6.5M or 49% increase), Generation expense ($1.5M or
6% increase), Administrative and general expense ($2.4M or 9% increase); partially
offset by License compliance expense ($2M or 17.5% decrease) and Transmission
expense ($2.8M or 61% decrease). These fluctuations are expected as part of the data
optimization project, which reallocated labor across the various FERC expense accounts
to improve reporting. The fluctuations do not have a significant impact to the overall
total operating expenses. We expect license and compliance expense to level out to
prior year amounts by year-end. The 2020 budget expected an increase in operating
expenses of approximately 3%. Use of Paid Administrative Leave and other delays
experienced by capital projects have caused $4M in labor expenses that were originally
expected to be capital. To date we have had $12.8M of labor costs charged to capital
projects; which is 23% less than the $16.8M budgeted through September.
the prior year. This decrease is largely due to the changes in operating revenues and
expenses described above, $3.1M of insurance proceeds related to the Central Ephrata
Substation claim, a $9.2M (73%) decrease in Contributions in aid of construction and the
impacts of the bond transactions that occurred in January, March, and September of
2020. The bond transactions have driven a $11.8M (26.5%) decrease in year to date
interest expense, but also had debt issuance costs of $2M to execute the transactions
and $3M in losses associated with the defeasance of $81.8M of outstanding bonds.
Statement of net position:
o
Total cash and investments of $446.7M were $96.4M (17.8%) less than the same period
in the prior year due to the planned use of funds for the defeasance of bonds and to
adjust to the new Electric System liquidity target of $105M. There was a corresponding
decrease in outstanding debt of $88.2M (6.8%).
o
Utility plant, net increased $74M or 3.5%.
o
Customer Deposits of $5.4M were $9.4M (63.7%) less than the same period in the prior
year due to two large refunds totaling $9.7M to an industrial and wholesale customer.
PUBLIC UTILITY DISTRICT NO. 2 OF GRANT COUNTY UNAUDITED
STATEMENT OF NET POSITION September 30, 2020 AND 2019 2020 2019 Difference CURRENT ASSETS Cash 1,547,058 4,959 2,828,868 Investments 76,037,008 97,849,954 (21,812,946) Restricted funds Cash 155,730 663,216 (1,794,254) Investments 82,592,778 128,379,118 (45,786,340) Customer accounts receivable, net 34,874,284 29,772,177 5,102,107 Materials and supplies 18,747,720 17,806,789 940,931 Other current assets 189,378 166,554 22,823 Total current assets 214,143,956 274,642,767 (60,498,811) NONCURRENT ASSETS Investments 10,641,710 3,078,831 7,562,879 Restricted funds Cash 205,617 1,894,808 (1,689,191) Investments 275,515,471 311,241,087 (35,725,615) Conservation loans 334,102 389,179 (55,077) Demand-side management 60,071 261,829 (201,758) Preliminary expenses 3,979,265 4,785,388 (806,123) Total other noncurrent assets 290,736,237 321,651,121 (30,914,885) Utility plant, net 2,192,111,005 2,114,960,971 77,150,034 Total noncurrent assets 2,482,847,241 2,436,612,092 46,235,150 DEFERRED OUTFLOWS
Net pension, change in proportion 6,409,454 5,753,562 655,892 Other Post Employment Benefits 2,290,950 2,290,950 Unamortized refunding loss 34,813,396 3,718,138 31,095,258 Total deferred outflows 43,513,800 9,471,700 34,042,100 TOTAL ASSETS AND DEFERRED OUTLFOWS OF RESOURCES 2,740,504,998 2,720,726,559 19,778,439
Accounts payable
Trade 15,133,108 10,174,119 4,958,988 Wages payable 11,813,110 7,503,880 4,309,229 Due to Power Purchasers 1,581,660 2,622,184 (1,040,524) Accrued taxes 6,162,564 5,680,081 482,483 Customer deposits 5,339,908 14,729,397 (9,389,489) Accrued bond interest 11,106,088 14,451,589 (3,345,501) Unearned revenue 9,173,155 210,181 8,962,974 Habitat liability 17,791,845 17,050,503 741,342 Other current liabilities 39,768 39,768 Current portion of licensing obligations 2,343,889 2,283,494 60,395 Current portion of long-term debt 29,295,000 30,580,000 (1,285,000) Total current liabilities 109,780,093 105,325,196 4,454,897 NONCURRENT LIABILITIES
Revenue bonds, less current portion 1,171,430,000 1,238,815,000 (67,385,000) Unamortized (discount) premium, net 13,813,141 33,373,781 (19,560,640) Licensing obligations, less current portion 70,704,367 46,307,467 24,396,900 Pension obligations 24,837,391 32,686,126 (7,848,735) Accrued other postemployment benefits 9,705,904 6,977,140 2,728,764 Long-term unearned revenue 8,507,207 2,076,906 6,430,301 Total noncurrent liabilities 1,298,998,009 1,360,236,420 (61,238,410) DEFERRED INFLOWS
Net pension, deferred inflow 14,701,254 13,692,570 1,008,685 Total deferred inflows 14,701,254 13,692,570 1,008,685 Total liabilities and deferred inflows of resources 1,423,479,357 1,479,254,186 (55,774,829) NET POSITION
Invested in capital assets, net of related debt 984,733,531 860,759,528 123,974,003 Restricted 285,951,546 321,101,100 (35,149,554) Unrestricted 46,340,564 59,611,745 (13,271,181) Total net position 1,317,025,641 1,241,472,373 75,553,268 TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET
PUBLIC UTILITY DISTRICT NO. 2 OF GRANT COUNTY UNAUDITED
STATEMENT OF REVENUES AND EXPENSES AND CHANGES IN NET POSITION For the Nine Months Ending September 30, 2020 and 2019
2020 2019 Difference OPERATING REVENUES
Sales to power purchasers at cost 19,344,375 21,126,807 (1,782,432) Retail energy sales
Residential 33,212,991 34,646,668 (1,433,677) Irrigation 22,638,448 20,588,307 2,050,140 Commercial and industrial 98,353,039 100,677,637 (2,324,598) Governmental and others 1,024,317 1,914,661 (890,344) Wholesale revenues, net 61,044,770 51,704,041 9,340,729 Fiber optic network sales 7,720,641 6,928,162 792,480 Other 1,177,956 1,684,963 (507,007) Total operating revenues 244,516,537 239,271,245 5,245,292 OPERATING EXPENSES
Generation 26,073,760 24,595,276 1,478,484 Transmission 1,782,419 4,611,757 (2,829,339) Distribution 20,060,510 13,505,225 6,555,284 Customer and information services 2,799,701 3,096,084 (296,383) Fiber optic network operations 1,809,693 1,895,328 (85,635) Administrative and general 29,552,605 27,087,949 2,464,656 License compliance and related agreements 9,586,727 11,621,773 (2,035,046) Depreciation and amortization 57,956,876 55,934,461 2,022,415 Taxes 12,834,759 13,030,354 (195,595) Total operating expenses 162,457,050 155,378,208 7,078,841 NET OPERATING INCOME 82,059,487 83,893,037 (1,833,549) OTHER REVENUES (EXPENSES)
Interest and other income 17,553,723 19,387,919 (1,834,196) Interest on revenue bonds and other, net of capitalized interest (32,745,275) (44,560,480) 11,815,205 Federal rebates on revenue bonds 7,903,261 7,913,646 (10,384) Amortization of debt discount/premium (4,181,218) 2,638,087 (6,819,305) Cost of debt issuance (1,995,613) (141,109) (1,854,503) Total other revenue (expenses) (13,465,121) (14,761,938) 1,296,817 CONTRIBUTIONS IN AID OF CONSTRUCTION 3,374,176 12,608,023 (9,233,846) CHANGE IN NET POSITION 71,968,542 81,739,121 (9,770,579) NET POSITION
Beginning of year 1,245,057,099 1,159,733,252 85,323,847 End of year 1,317,025,641 1,241,472,373 75,553,269
Powering our way of life.
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Cash & Investments
Key Cash Flow Dates:
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Q1 Debt financings- release of
cash for defeasance/escrow
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Jan 2
nd
2020 bi-annual debt
service payment: $59.2M
•
July 1
st
2020 bi-annual debt
service payment: $20.7M
(interest only payments)
•
•Upcoming Jan 2nd bi-annual
debt service payment: $51.7M
•
CREB sinking funds are held
and increased to meet the
required principal payments in
2027, 2032, 2040
Notes:
•
Staff is evaluating the Insurance
Reserve fund and is planning to
bring forward a resolution for
Commission review to update
Public Utility District No. 2 of Grant County
Quarterly Treasurer's Report
Historical Cash and Investments Summary | Liquidity and Restricted
Market Value per Financial Statements in thousands $000(1) Electric System R&C Fund liquidity target = $100M + interest earnings
(2) Electric System Revenue Fund minimul balance = $5M. Excess funds above liquidity target utilized for annual planning of equity financing of PRP capital (Junior Lien Bonds, see Note 4). (3) Other funds used in Days Cash On Hand metric include PRP Revenue, PRP Supplemental R&C, Service System, and Customer Deposit Fund
(4) Construction funds comprised of internally pledged funds for capital and issued bonds
(5) CREB sinking fund payments required by bond covenants to pay bullet maturities in years 2027 ($90M), 2032 ($42.4 M), and 2040 ($90M). Monthly deposits to sinking fund made, recalibrated every 6 months.
As of 09/30/2020
Cash & Investments 9/30/2018 12/31/2018 3/31/2019 6/30/2019 9/30/2019 12/31/2019 3/31/2020 6/30/2020 9/30/2020 Liquidity-ES R&C Fund (1) $ 122,318.8 $ 124,201.3 $ 126,043.9 $ 127,956.0 $ 129,622.4 $ 129,841.3 $ 106,096.3 $ 104,927.5 $ 106,039.8
Liquidity-ES Revenue Fund (2) (4) 126,127.2 133,651.3 152,637.6 46,539.4 58,689.4 72,734.1 40,693.8 47,061.4 58,362.8
Other DCOH Funds (3) 33,671.9 35,469.5 45,822.5 57,943.7 54,459.9 46,881.0 49,735.0 51,260.6 43,288.7
Liquidity and Other DCOH Funds $ 282,117.9 $ 293,322.1 $ 324,503.9 $ 232,439.1 $ 242,771.7 $ 249,456.4 $ 196,525.1 $ 203,249.5 $ 207,691.4
Restricted-Construction Funds (4) 51,896.7 27,422.9 11,607.7 107,080.3 90,957.5 74,368.7 54,421.5 42,973.0 31,495.0
Restricted-DS Reserve Funds 54,827.9 55,636.0 56,618.9 57,565.4 58,210.0 58,320.7 43,759.7 44,717.4 45,154.8 Restricted-DS P&I Funds 54,303.7 87,998.4 30,475.4 54,665.1 57,650.1 89,073.4 30,962.7 53,602.5 54,768.5 Restricted-DS CREBs Sinking Funds (5) 63,360.1 61,450.4 69,991.5 78,769.0 76,466.2 79,138.8 84,536.3 86,469.6 89,787.9 Restricted-Habitat Funds 16,563.1 16,224.4 18,242.2 17,588.3 17,056.5 15,888.5 18,063.4 17,906.7 17,797.8
All Restricted Funds $ 240,951.5 $ 248,732.1 $ 186,935.7 $ 315,667.9 $ 300,340.3 $ 316,790.1 $ 231,743.7 $ 245,669.1 $ 239,004.0
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environment has impacted the ability to transact in all sectors consistently and efficiently
• The state LGIP remains an effective liquidity management investment program
•Based on economics the District has methodically decreased the concentration to
invest in other sectors within the policy limits
•Diversification if evaluated based on allocation of the total portfolio
Security Type ($ in Millions)Book Value Yield AllocationPortfolio Policy Max Target Range In Compliance
Municipal Bonds $ 155.2 3.80 35.2% 50% 25-40% YES WA State LGIP $ 63.0 0.26 14.3% 100% Varies YES Agency $ 91.2 1.03 20.7% 50% 10-30% YES Corporate Bond $ 47.8 1.44 10.8% 25% 5-15% YES US Treasury $ 60.9 0.41 13.8% 100% 20-40% YES Supranational $ 19.7 0.86 4.5% 50% 10-30% YES Commerical Paper $ 2.0 0.37 0.5% 25% 5-15% YES Bank Holdings (Cash) $ 1.2 - 0.3% n/a < $3M avg YES
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Cash & Investments
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Interest earnings are driven by UST rates both directly as an investment and as a driver to
underlying transactable yields
•
The Fed Funds target currently is at 0.00-0.25%
•
The District’s policy follows state requirements and strategy is based upon the tenants of
•
1) legality, 2) safety, 3) liquidity, and 4) return
•
LGIP rates have declined but has remained a strong liquidity management program vs
other short-term options
Short term liquidity management
Q3 average LGIP yield
0.26%
State LGIP 10/31/20 Yield
0.18%
3 month T-bill 10/31/20 Yield
0.10%
Overnight repo rate quoted 10/31/20
0.06%
5
Aggregate Portfolio Q3 Book Yield 9/30/20
2.07%
Aggregate Portfolio Q3 Modified Duration
1.96 Years
2020 Budget= $8.8M Interest Income @ 2% assumed earnings rate
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January impacts earnings dollars (Elec R&C, Elec Rev, Bond Reserves)
•
Investment in muni’s return @ 3.8% yield, propping up overall aggregate yield amidst
falling rates
•
26% of portfolio matures > year 2022 (a large portion was executed when rates were
higher)
2019
Projected
2020
Investment Receipts
(Coupons/Accrued)
$ 10.3 $ 10.6
Realized G/L
(Premium/Discount
Amortization)
$ (2.2) $ (6.0)
Total Portfolio Return
$ 8.1 $ 4.6
Unrealized G/L (Market Fair
Value Adj)
$ 7.0 $ 7.3
FS Investment Income
$ 15.1 $ 11.9
shown in $ millions
$0 $5,000,000 $10,000,000 $15,000,000 2020 2021 2022 2023 2024 2025Projected Earnings
Forecasted Interest Earnings Cash Flows Forecasted Accrual Based Earnings
6
Debt Portfolio
•
Principal and interest
payments Jan 1 annually
•
2
nd
half interest payments
7/1 annually
•
Variable rate interest
payments monthly
•
1/12
th
of fixed rate annual
debt requirements “set
aside” in P&I funds monthly
•
Defeasance in 2020 reduced
outstanding debt liability
•
Internal PRP financing of
capital (JLB bonds) has
historically resulted in
reduction of bond financed
capital by utilizing equity
•
Most recent debt transaction
closed on 9/1 and resulted in
yields of 0.5% and 0.65%
(yield to call)
•
Weighted average
coupon rate
of
fixed debt: 4.4%
•
Effective cost of debt
for entire
portfolio (net of interest rebates
and sinking funds): 3.4%
•
Weighted average life
of portfolio
12.2 years
•
Reduction in par outstanding
amount of $4.6 million due Electric
Sept transaction priced as
premium bonds
•
Overall debt activity financial
statement impact $4.3 million lower
due to favorable financings better
than budget
Total Consolidated Outstanding External Debt
Total = $1,200,725 as of 9/30/2020
2020 Budget
2020
2021
2022
2023
2024
Principal Due and Accrued $ 43.7 $ 29.3 $ 31.5 $ 34.2 $ 33.4 $ 35.8
Interest Due and Accrued $ 43.3 $ 44.2 $ 45.2 $ 44.1 $ 43.0 $ 41.7
CREB Sinking Fund Deposits $ 8.7 $ 9.3 $ 10.0 $ 10.0 $ 10.0 $ 10.0
Federal Interest Rebates $ (10.5) $ (10.5) $ (10.5) $ (10.4) $ (10.4) $ (10.3)
Projected New Debt Service $ - $ 1.8 $ 2.6 $ 4.1 $ 6.0
*Subtotal Cash Impact
$
85.2
$
72.2
$
78.0
$
80.6
$
80.2
$
83.2
Amortization of Discount/Premium/Issuance Cost $ (2.2) $ 6.4 $ 2.4 $ 0.7 $ 1.5 $ 1.1
**Net Debt Activity
$
83.0
$
78.7
$
80.4
$
81.2
$
81.7
$
84.3
Variance to 2020 Budget $ (4.3)
Shown in $ millions
7
•
The Strategic Plan target for debt to net plant ≤ 60% and is a factor in determining future financing
•
Par balance of Iinternal PRP Junior Lien Bonds (JLB) to the Electric System = $400.7 million
•
Current finance plan indicates equity financing for 2021 and 2021 with external bond issuances to
fund capital
•
2021 resolution to extend JLB program from authorization level
and cash funding for capital
•PRP construction fund balance as of 11/1- $26
million
•12-month avg fund mo. spend ~ $5M
•Scheduled PRP JLB -Q1 2020 ~ $30M,
transfer funds from Elec Revenue fund
(subject to change time/amount based on
need/availability)
•Balance of construction spending to be
funded by bond proceeds
•Electric construction fund – revenue funded
•12-month avg fund mo. spend ~ $5.5M
New money bond funding July of 2021 ~
$50M estimated (subject to change)
•July 2021 variable rate debt 2019-P required
refunding transaction ~$50 M
•Timing of new bond proceeds to
coincide with refunding – estimated ~ $50
million new proceeds
• Monitoring refunding opportunities that could meet
District policy of >3% PV savings and >50% escrow
efficiency
Series Outstanding Par Amount Coupon Range Final Maturity 2014JLB $ 40,170,000 2.38% - 4.25% 1/1/2044 2015JLB $ 27,040,000 5.034% 1/1/2045 2015JLB B $ 7,625,000 5.213% 1/1/2045 2016JLB $ 29,380,000 2.85% - 4.92% 1/1/2046 2017A JLB $ 24,810,000 2.87% - 5.00% 1/1/2047 2017B JLB $ 83,560,000 2.90% - 4.93% 1/1/2048 2019JLB $ 108,480,000 1.83% - 3.352% 1/1/2049 2020JLB $ 79,585,000 1.694% - 3.41% 1/1/2050
Total Junior Lien Debt $ 400,650,000
Internal Financing-Junior Lien Bonds
Priest Rapids Project (PRP)
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Debt Management- Credit Ratings
•
During December 2019 and March 2020
the Utility received credit ratings from
Fitch, Moody’s, and S&P for the 2020
issuances
•
Electric System carries a slightly higher
rating than PRP for one rating
•
The Electric System was rated in August
by Fitch and S&P for the series R & S
transactions
9
Last Updated On: 2/20/2020Notes
•
Resolution 8712 delegates banking and investment responsibilities to the Treasurer and provides certain guidance. Section 7 details that the Treasurer’s report
will include: cash/investment activity/balances, authorized list of banking institutions/brokers, authorized treasury staff to perform banking and investing activities,
and a summary of petty cash funds.
•
The Advanced Travel Imprest account was reduced due to inactivity, this separate account is required by RCW 42.24.130
•
The CS Refund Imprest account custodian was updated, this account is scheduled to significant reduced activity due to a process improvement to integrate into
the standard AP function as a result of the CCS upgrade.
Continuing to safely, efficiently and effectively execute projects
Quarterly Commission Update – November 2020
Powering our way of life.
2020
Q3 Review
Structure and Personnel
Safety Update
Budget Update
Q3 Accomplishment Updates
Acronym List
•
EPMO Enterprise Project Management Office
•
ET
Enterprise Technology
•
PP
Power Production
Department
Purpose
Improve the probability of successful
project delivery to create greater
business value
Improve
Become the source for guidance,
documentation and metrics for the
practices involved in managing and
implementing projects within Grant
PUD.
Department
Goals
Cultivate a business driven EPMO that
enables consistent, reliable data and
outcomes
Standardized business driven project
management framework
Employ change management
principles to allow greater adoption,
utilization and proficiency
The success of the EPMO is derived
exclusively from achieving greater
business value to the utility
Senior Manager EPMO
Julie Pyper
Manager Power
Production
Aaron Kuntz
Administrative
Assistant
Project Managers
Outage Coordinator
Manager
Facilities &
Project Services
Dustin Bennett
Project
Coordinators
Construction
Inspectors
Lead Project
Manager - QA
Randy Weisheit
Manager IT
Projects
Chris Roseburg
Project Manager
Project
Coordinators
Senior Training
Coordinator
Manager Power
Delivery
Allen Chatriand
Project Managers
Project
Coordinators
Business Analyst
Krissy MacKenzie
Administrative
Assistant
Mindy Klingenberg
District
Personnel
• Selected as EPMO Manager – Power Delivery
• Previously Senior Project Manager in EPMO Power
Production
• Backfilling his project manger position
Allen Chatriand
• Promoted to Project Coordinator from Administrative
Assistant
• Provides schedule management and OCM support
Mindy Klingenberg
• Selected as EPMO Power Delivery Senior Project
Manager - manage Quincy Transmission Expansion
Project
• Previously Senior Project Manager in EPMO Power
Production – PR Turbine Generator project
• Backfilling his position
Travis Wiser
• Hired as Project Manager for Power Production
• External hire (Palisades)
Contracted
Personnel
Named
Resources
Rachelle McGillivray
Power Engineers
ESRI/GIS Project
(until E0P)
David Poulin
TMG Consulting
CCS Project
Dec 2020
(until EoP)
Brent Gregory
Arch Staffing and
Consulting
Project Management
Framework and misc.
project support
Dec 2022 (+)
Cliff Woods
Arch Staffing and
Consulting
Ephrata and Moses
Lake Service Centers
Dec 2022
(until EoP)
Ben Floyd
White Bluffs
Consulting
Facilities Master Plan
Dec 2021
(until EoP)
Thomas Karcz
Arch Staffing and
Consulting
OCM Program
Dec 2022 (+)
Ann Shiveley
VOLT
OCM project support
May 2021 (+)
Power
Production
To Be Named
Resources
Name
Consulting
Firm
Project
Estimated
Duration
EPMO 1
TBD
Project Control Services
Dec 2022 (+)
EPMO PD 1
TBD
OSS/BSS (Fiber tech) project
TBD (EoP)
EPMO PD 2
TBD
ECBID project
TBD (EoP)
EPMO PD 3
TBD
Invenergy project
TBD (EoP)
EPMO PD 4
TBD
Project Development –
NLL/Interconnect
Dec 2022 (+)
EPMO ET
TBD
Remaining HCMS modules
Dec 2021
EPMO ET
TBD
ET program support
July 2021 (+)
EPMO PP 1
TBD
PM for specific project being
determined
TBD
EPMO PP 2
TBD
PM for specific project being
determined
TBD
EPMO PP 3
TBD
Project Coordinator for specific
project being determined
TBD
EPMO PP 4
TBD
Project Coordinator for specific
project being determined
TBD
EPMO PP 4
TBD
Project Coordinator for specific
project being determined
TBD
Additional contracted needs to be determined on a project-by-project basis.
Contracted
Personnel
Potential PP
Projects for
Contracted
Resources
WAN/PR Station Service
2020
CO2 Replacement
2021
Maintenance Equipment Storage at WMC
2021
Power Production Tag in/Tag out System
2021
PRP Control Room Renovations
2021
WAN Bridge Cranes
2021
WAN Fish Ladder
2022
PR Fish Ladder Rehabilitation
2022
PR Hatchery Siphon Intake Renovation
2022
PR Warehouse
In progress
PR Right Embankment Improvement Project
In progress
PR Turbine Generator Rehab Project
In progress
Safety Update: Safety Meeting Attendance
100% 100%
97%
94%
100% 100% 100% 100% 100%
JAN-20 FEB-20 MAR-20 APR-20 MAY-20 JUN-20 JUL-20 AUG-20 SEP-20
