BOARD OF COMMISSIONERS'
REGULAR MEETING

January 26, 2010
1:30 p.m.
Harris Hall Main Floor
APPROVED 3/17/2010

Commissioner Bill Fleenor presided with Commissioner Bill Dwyer, Rob Handy, Pete Sorenson and Faye Stewart present. County Counsel Jeff Spartz, County Counsel Liane Richardson and Recording Secretary Melissa Zimmer were also present.

8. PUBLIC WORKS

a. DISCUSSION/“No Net Increase” Stormwater Policy Work Session. 

Dan Hurley, Public Works, gave a Power Point presentation on the no net increase for stormwater.

Bill Morgan, Public Works, indicated that he would be putting in money for some of the IGA’s. He said it was $25,000 for each city to meet the minimum requirement. He thought it was money well spent.

Dwyer asked where they were with stormwater SDC’s.

Marsha Miller, Public Works, recalled the Board had a work session on SDC’s in November and they were asked to hold off and come back to the Board.

Hurley recommended a utility fee tacked onto water usage. He thought that could be explored at the County level. 

Sorenson asked what happens if they want to get more aggressive today. He asked if they could have a plan in place for when the economy does turn around. He wanted to increase protection to the citizens and deal with the problem. He thought it will only get worse. 

Morgan commented that both cities have the same rate. He said it is difficult to talk about taxes and fees but internally within Public Works they need to get staff on this to start assembling the information on what a program would look like. He thought they needed to see how the city is funded and then come back in a couple of months with a work session.

Stewart said when they had the SDC conversation; they discussed SDC’s for roads that included stormwater and Parks SDC’s. He recalled the only action they took was to deal with the direction for Parks SDC’s. He said they have gone through the recession and they have doubled the price of the permits. He thought they just needed Board direction for implementation. He thought this should go before Finance and Audit to discuss the details to see if they recommend forwarding this to the Board at this time or wait an additional period of time. He said he didn’t want to see any water runoff on County properties outside of the city limits. He had concerns about the pollution and thought there should be some sort of a filtration system. 

Hurley indicated the city of Springfield adopted an amendment to their Stormwater Management Plan for flow and volume. His concern is that it is one thing to have a policy goal, but to have regulations to support that would be needed and currently the cities of Eugene and Springfield do not require infiltration.

Handy wanted to move forward with SDC's. He said they need to design a system that works and they don’t have that in Springfield. He thought there was a nexus with Waste Management. He wanted to review the Land Management work plan and funding. He asked what other communities were doing and how they are addressing the standards to come up with no net increases.

Fleenor asked if the County was out of compliance.

Hurley said they were out of compliance, but the state is not pushing enforcement as long as they have timelines. He thought it could be three years until they get their permit.

Fleenor asked if this should be acknowledged on the books.

Richardson said she will see if it hits a trigger and if they have to put in on to books. 

With regard to SDC’s Morgan recalled the SDC’s for stormwater were excluded when Celia Barry, Public Works, brought it to the board.

MOTION: to extend this item.

Handy MOVED, Dwyer SECONDED.

Sorenson supported extending this item.

Stewart said most construction in rural Lane County is governed by them. He said if they are concerned about storm water, the citizens could put in their own bioswales. He asked how much money they were going to generate if they take that approach. He said it is hard to fix the situation with no way to recover the money. He asked how they could justify a system that shifts the burden to someone else who is not going to pay for it.

Handy thought they have to revisit the assumptions that the cities are the logical providers of services and that the County has a responsibility along with the funding sources. He asked if Springfield was going to pull some proposals from the drafts.

Andy Clark, Assistant County Counsel, reported that Springfield needs to start moving on their projects within the city limits. He said if the County adopts the facilities plan amendment they propose next week, it would override the city’s ordinance. He said it was important to do all of them in and out of the city, but if they can’t do all of them, they need to move the ones within the city.

Stewart was in support of developing a code in Land Management that would address issues and encourage people to capture their rain water. He thought it would be beneficial and would address what they are discussing.

Dwyer wanted suggestions taken back about Springfield beefing up its code to give Lane County assurance that things work as a last resort before they go to the other language. He said right now nothing lays out what it should be.

Hurley indicated that he would bring it to the city of Springfield.

Fleenor indicated that this will come back in six months for a report.

Miller recalled earlier in the day there were discussions about SDC’s that came before the Board. She said those didn’t address stormwater because they don’t have a stormwater system. She asked if the Board wanted her to bring it through Finance and Audit. 

Dwyer thought she should bring it to Finance and Audit with a report and then the Board could take action.

9. MANAGEMENT SERVICES

a. REPORT/County Photovoltaic Feasibility Study.

Craig Volz, McKinstry, explained that Scenario A is a basic power purchasing agreement where the County would be the host, the solar system would be installed by a third party investor and the County would enter into a power purchasing agreement, to purchase the power at a below market rate for the term of the contract (25 years) and there would be a fixed escalation rate, starting at the below market rate. 

Dwyer commented that if they are generating revenues with resources that they wouldn’t need a third party.

Volz reported that the County is a tax-exempt public agency and there are incentives for solar that only a private company with a tax liability could capture. He said the power purchasing agreement is based on an investor who is able to capture them. He said with Scenario B, a public agency could use a power purchase with a buy out to allow the private investor to use tax credits that the County wouldn’t be eligible for and they could purchase a fully depreciated system at cents on the dollar. He commented that it was a good option to move toward ownership.

Volz stated that they evaluated 9 or 10 sites and 8 sites were feasible. He added that of those sites they are looking at 1 megawatt of installed power. He noted under the basic scenario the County would pay nothing for the installation. He said it would be fully financed and owned by a third party investor. He added that over the course of the 25 year term, (assuming the starting rate of half a cent below market and a three percent annual escalation rate) they would save $622,000 net percent over a 25 year period of time. He said in today’s dollars it would be about $365,000.

Volz thought the buyout option might be of interest except it takes capital to purchase a system. He said over time the purchase option won’t be until the end of the sixth year and the beginning of year seven. He said the savings would be small in the first years. He didn’t think it could generate enough capital to purchase the system. He reiterated for Scenario B, the County would be purchasing a system year seven for approximately 15 percent of the original system cost. He thought it would be around $6 per watt or less for an installed cost. He said it would generate more savings over a 25 year period ($1.2 million) and a higher net present value. He said they would have to come up with the capital. He added they could take power and participate in EWEB’s direct participation program to receive revenue at 12 cents per kilowatt hour. He said by having the buyout option they could pick and choose at which point in time, based on availability of capital. He added if the County decides never to exercise the buyout option, they would still be accruing benefits with reduced electricity rates and saving 600 metric tons of greenhouse gases.

Dwyer asked if it would cost more to maintain the roof than the electricity.

Volz responded that the County would be giving an easement for routine maintenance and service. He said the systems are monitored remotely so people don’t have to walk up to see if the system is working. He said because of the life and expense of the systems they don’t want to put a 25 year system on a roof that has five years left. He thought the priority should be a new roof and then pick a system that is minimally evasive with regard to penetrations to the roof.

Fleenor asked about an inverter system.

Volz recommended getting the extended 20 year warranty on the inverters. He added the County would pay a premium but it lasts in the long run, especially if the County were to consider the buy out option. He noted the County would be purchasing the system in year seven at 15 cents on the dollar and it extended an additional ten years of a warranty.

Sorenson asked which option they would recommend.

Volz indicated they reviewed the Department of Youth Services, Mental Health, the Adult Corrections Facility, Courthouse and Public Service Building, the Armoury and ground mounts at DYS. He found that all the sites were feasible and they would generate a return that an interested investor would be willing to accept. He believed all would be attractive to a third party investor. With regard to recommendations, (given the caveats about roofs,) he would see this as a “no brainer” for the basic power purchase agreement. He said it would depend upon individual owners or agencies on whether the buy out option is the best option for them.

Handy asked Mike McKenzie-Bahr, Economic Development, if he had a recommendation.

McKenzie-Bahr said they hired a group of consultants and are investigating multiple funding options for renewable energy. He wanted to look at Option B to see if they could create their own energy or sell energy.

Stewart asked if there would be any investors looking at Short Mountain.

Volz commented that they are confident there are credible investors who are interested in projects like these. He noted at the Oregon level, (because of potential rule changes to the business energy tax credit,) this could evaporate and they won’t begin to get clarity until after the special session. He commented that if things stay as they were, there will be an investor who will step up for this project. He added if there are changes, it could ruin the rate of return. 

With regard to a rate of return, Volz thought Option A was better than Option B because there is no investment. He thought there was a risk of doing nothing with the lost opportunity cost.

Sorenson asked for Spartz’ recommendation to move ahead with the projects.

Spartz requested from the Board that staff meet with the consultant first on Scenario B. He wanted to make a more rigorous cost analysis more comparable to Scenario A. He also wanted to do an analysis on Short Mountain and determine the viability of the project there and to do more than a cursory analysis of the Events Center.

McKenzie-Bahr stated that he met with three companies who are working with parking lots.

MOTION: to move that the Board request staff to meet with the consultant first on Scenario B; to do a more rigorous cost analysis to make it more comparable to Scenario A;. to do an analysis on Short Mountain and determine the viability of the project there and a more than cursory analysis of the Events Center.

Sorenson MOVED, Handy SECONDED.

Stewart wanted Spartz to work with McKenzie -Bahr and with Patti Hanson on Short Mountain. He indicated that they will need public input around the Serbu Center taking up parking they use for football games and for revenue for the Boy Scouts. He commented that if they move full steam ahead they will entail some issues that will not be pleasant to deal with. He added that at the Fairgrounds there are a lot of the items take place on the parking lot. He didn’t know how much of the parking could be used for a structure above it.

Spartz said this will not be a rush to adjustment. He indicated there were a number of steps they have to go through including public input and working with everyone involved to make sure what they proposed is feasible and wanted.

Sorenson withdrew his motion. Handy withdrew his second.

Fleenor wanted to see a ranking that was most optimal.

Spartz said he would look at the overall system and cost and what makes the best economic package for generating power. 

10. COUNTY COUNSEL

a. Announcements

Richardson announced that she has hired a new County Clerk, Cheryl Betschart. Richardson said her official starting date is February 8.

11. PERFORMANCE AUDITOR

a. Announcements

None.

12. COMMISSIONERS' ANNOUNCEMENTS

Sorenson announced that Alex Gardener and he are making a presentation to the Eugene Area Chamber of Commerce Local Government Committee this week. He said he will be addressing the financial aspects of Lane County government and Gardner will be addressing public safety issues and concerns. 

Handy said February 17 is the next town hall meeting on food security issues in Lane County. He said on Saturday he will join Stewart and Bill Morgan in Vida about the challenges with the Goodpasture Bridge.

Stewart said yesterday he took part in a county planning council, a subcommittee of SB 78, to discuss how counties that will lose SRS payments will deal with providing the services and what the County will look like.

13. EXECUTIVE SESSION as per ORS 192.660

Per ORS 192.660 (2)(h) for pending and potential litigation.

14. OTHER BUSINESS

None.

There being no further business, Commissioner Fleenor recessed the meeting into Executive Session at 4:05 p.m.

Melissa Zimmer
Recording Secretary