Huntsville Utilities Electric Board Meeting HU Board Room Wednesday, 11/20/2019 8:30 - 10:30 AM CT 1. Approve Drafted Minutes Approve drafted minutes of Regular Adjourned meeting of the Electric Utility Board held on October 23, 2019. 1.0 Electric Minutes October 23 2019 draft - Page 3 1.0 Electric Board Meeting Highlights - October 2019 - Page 7 2. Public Comments 3. Old Business a. TVA Partnership Proposal 3.a TVA Proposal - Nov 2019 - Page 8 b. HU Events Quarterly Video 4. New Business a. TVA VIP Agreement (Action Item) 4.a TVA COH Boeing VIP Agreement November 2019 Memo - Page 53 b. Electric Budget Update 4.b Electric Budget - Nov 2019 - Page 62 c. S&P Bond Rating 4.c S&P Rating Memo - Page 65 d. Proposed 2020 Board Meeting Schedule 4.d 2020-Bd-Cncl-Mtg-Dates-Draft - Page 72 e. Review O&M Transactions and Capital Spending Reports 4.e Oct 2019 Monthly O&M Purchases Greater Than $25,000 (Summary) - Page 73 4.e FY20 Electric Capital Monthly Progress Report - Page 75 4.e FY20 Electric Capital Multi Year Projects Monthly Progress Report - Page 78 5. Operating Reports a. Finance Presented By: Ted Phillips i. Discuss Financial Statements Financial Presentation 5.a.ii Elec Financial Presentation October 2019 - Page 79 Electric Financials 5.a.i Electric Financial Statements October 2019 - Page 92 ii. Cash & Investment Review 5.a.ii Cash and Investment Review Ocotober 2019 electric - Page 98 b. Operations Report Presented By: Mike Counts 5.b Electric Operations Report Oct 2019 BD Copy - Page 104 c. Engineering Report Presented By: Stacy Cantrell 5.c Engineering October Board Report - Page 113 d. Customer Care Report Presented By: John Olshefski 5.d Customer Care Report October 2019 - Page 131 e. Human Resources Report Presented By: Harry Hobbs 5.e Personnel Actions October 2019 - Page 138 5.e 2019 Recognition Discipline - Page 139 6. President's Report Presented By: Wes Kelley 6.0 Presidents Report Nov 2019 - Page 140 7. Comments & Questions from Board Members ________________________________________________________________________________ Master Page # 1 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 8. Legal 9. Adjourn ________________________________________________________________________________ Master Page # 2 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 PROCEEDINGS OF THE HUNTSVILLE ELECTRIC UTILITY BOARD at its Regular Adjourned Meeting Held October 23, 2019 Board Members present were Messrs. Ronnie Boles, George Moore and Thomas Winstead, constituting a quorum of the Board. Staff Members present were Messrs. Wes Kelley, President and CEO; Ted Phillips, CFO; John Olshefski, Vice President of Customer Care; Mike Counts, Vice President of Operations; Harry Hobbs, Vice President of Employee Engagement; Gary Whitley, Communications & Public Relations Manager; Ms. Stacy Cantrell, Vice President of Engineering; Ms. Melissa Marty, Director of Internal Audit; and Ms. Beverly Hughes, Executive Assistant. Mr. Boles called the meeting to order. Mr. Moore made a motion to approve the minutes, as drafted, of the Regular Adjourned Meeting of the Electric Board held on September 25, 2019. Mr. Winstead seconded the motion and it was passed. There was one visitor in attendance, Mr. Daniel Tait, with Energy Alabama. Mr. Tait addressed the Board and handed out an article he authored regarding the proposed TVA long term partnership agreement. As an advocate for renewable energy sources, Mr. Tait is concerned the agreement places a cap on local choice in generation and may actually decrease current flexibility. He also expressed concern with the 3.1% wholesale credit for LPCs that sign the new agreement. If all LPCs sign the new agreement, TVA would have 3.1% less revenue and this might cause rates to increase. Mr. Tait said he appreciates Huntsville Utilities cautious approach to this new agreement. Mr. Kelley discussed the Special Merit Policy. This policy is an experiment to recognize employees at the top of the pay grade for considerable actions taken. Currently there are 267 employees topped out. The FY2020 budget includes monies for this policy for potentially 100 employees. The Board discussed how generous our benefits are currently, however, the compensation system could be improved. If this Special Merit is started it will be hard to take it away. The Board and staff discussed the culture and compensation philosophy of field-based employees versus office-based employees, moving towards tying performance to pay, and how extra costs affect the bottom line. The Board did not take a vote on the Special Merit Policy. The Board suggested Mr. Kelley develop a more comprehensive compensation approach and ________________________________________________________________________________ Master Page # 3 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 PROCEEDINGS OF THE REGULAR ADJOURNED MEETING of the Huntsville Electric Utility Board Held October 23, 2019 Page 2 of 4 work towards keeping the company in good financial shape. Mr. Kelley will have this item removed from future agendas and inform the Gas & Water Board of the Electric Board’s decision. Mr. Kelley discussed the proposed Electric Financial Reserve Policy. The proposed policy is written for 45 days of minimum cash reserve; however, Mr. Kelley is proposing to change it to a 30-day policy. In looking at historical data, the electric system has reached 30 days of cash once according to SAP financial records. The City of Huntsville operates on a 30-day policy. In the five-year budget forecast, the 30-day cash reserves should be met in 3 to 4 years. The Board asked that as the cash reserve is being built that nonbudgeted items and additional cost items not be brought to the Board. Mr. Winstead made a motion to approve the Electric Financial Reserve Policy with a 30-day cash reserve. Mr. Moore seconded the motion and it passed. Mr. Kelley discussed the TVA Partnership Proposal and concerns of a 20-year evergreen contract. TVA has responded to the letter sent by Mr. Kelley stating Huntsville Utilities’ concerns. TVA’s letter states the 20-year evergreen provision is non-negotiable. Clarification is expected regarding the rate cap provision, and a pledge to improve the definition of “facilitation” as it relates to power supply flexibility solutions. Mr. Kelley and Mr. Heath discussed the breach of contract and remedies as stated in the agreement. This included the distributor paying TVA for estimated losses of revenue and load served. Mr. Kelley plans to conduct careful due diligence by meeting with other LPCs that have not signed the agreement, talking to other power supply companies, and looking at collaborative efforts to improve the agreement. As an education opportunity, EnerVision, a power supply consulting firm, has been contacted to better understand the power supply market and evaluate options. EnerVision is planning to be at the November Board meeting with a presentation. Mr. Olshefski briefly reviewed the Energy Services Year-End Report. This report shows that a lot of good work is being done to help our customers with energy efficiency. ________________________________________________________________________________ Master Page # 4 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 PROCEEDINGS OF THE REGULAR ADJOURNED MEETING of the Huntsville Electric Utility Board Held October 23, 2019 Page 3 of 4 Mr. Kelley discussed the Strategic Plan KPI Fourth Quarter Report. A year end meeting with staff is scheduled to review the KPI’s to adjust, add or replace the current KPI’s. Approximately 70 to 80% of the KPI’s are useful and the others will be discussed for revisions. Mr. Kelley appreciates the Board’s input and looks forward to continued support and guidance. Mr. Boles recommended using the percentage for the gross margin number. The quarterly Huntsville Utilities events video was postponed until next month at the request of the Board. Mr. Moore made a motion to approve purchase requisition no. 10308725 for Storm Recovery work from the September 10, 2019 storms. Mr. Winstead seconded the motion and it passed. Mr. Kelley discussed the O&M Transactions over $25,000 and Capital Spending Reports in the Board package. Mr. Boles asked for an explanation on the replacement cost of truck #466 shown on the capital budget report. Mr. Phillips and Mr. Counts will get that information and provide it to the Board next month. Mr. Phillips briefly discussed the financial reports and year to date revenues and expenses for the month of September, which had been distributed to the Board Members earlier. Mr. Phillips noted that the financials presented are draft and the final numbers will be provided with the external auditor’s report. In response to the question last month, Mr. Phillips provided an explanation of the decrease in net position. Mr. Counts reported that Mr. Cole Border, Electric Apprentice, has been invited to compete in the International Lineman’s Rodeo in Kansas as a result of earning first place at the Tennessee Valley Lineman’s Rodeo. Mr. Border competed against 321 apprentice linemen from large companies like Duke Energy, Edison Electric, and Pacific Gas and Electric. He placed in the top 100 in three events and 179 in one event. He represented Huntsville Utilities very well. Ms. Cantrell reported that the Google deadline to pass 95,000 households was met on Friday, October 18, 2019, with a turnover of 96,400 households passed. This was a company wide effort to pull together to ________________________________________________________________________________ Master Page # 5 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 PROCEEDINGS OF THE REGULAR ADJOURNED MEETING of the Huntsville Electric Utility Board Held October 23, 2019 Page 4 of 4 meet this deadline. Mr. Kelley and Ms. Cantrell are looking at the future of fiber and how to wrap up the current project. Mr. Olshefski reported that the American Public Gas Association is holding their Operations Conference in Huntsville next week. Dr. Hobbs commended two children of two Huntsville Utilities employees that won the Citizen of the Month, CAFY Award. He also reported that the new employee survey is planned to be launched in January. Mr. Kelley reported that in working with the City more closely he has had several meetings with Mayor Battle and quarterly meetings with leadership has been scheduled to discuss overlapping issues and hot topics. Mr. Winstead commended Mr. Olshefski, Dr. Hobbs and all the executive team on doing a good job. There being no further business, Mr. Boles adjourned the regular meeting. ___________________________________ Chair ____________________________________ Secretary ________________________________________________________________________________ Master Page # 6 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville Utilities Electric Board Meeting Highlights Electric Board Meeting – October 2019: The Electric Board met on Wednesday, October 23rd, with one guest: Daniel Tait with Energy Alabama. Electric Board Action Items  A motion passed approving the Electric Financial Reserve Policy  A motion passed approving a Non-Budgeted Purchase for September 10th Storm Recovery Electric Financials  Electric Sales Revenue for September was $48,316,769; down 1.4% from September 2018  Total kilowatts sold in September: 494,626,142; up 1.7% compared to September 2018  Purchased Energy in September increased 5.5% compared to September 2018 at $39,511,384 ________________________________________________________________________________ Master Page # 7 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM To: Electric Board From: Wes Kelley, President/CEO Date: November 12, 2019 Subject: TVA Long-Term Partnership Proposal On November 7, TVA held its first “Valley Partner Engagement” meeting. TVA invited the 132 utilities that signed its long-term partnership agreement. After the meeting, TVA released the presented material to all TVA customers. They also provided an updated redline version of the long-term partnership agreement. The meeting material described TVA’s planned ongoing engagement with its long-term partners. Ongoing engagement will include a two-day meeting in the winter and a half-day meeting in both the summer and fall of each year. At these meetings, TVA plans to discuss strategic items in advance of scheduled TVA Board meetings. At the meeting on November 7, TVA also reviewed its long-range financial plan, which calls for stabilizing TVA’s debt around $18-$20B (down from ~$27-$25B in recent years) and maintaining rates as low as feasible. TVA also discussed several known risks that could impact its long-range plans. The long-term partnership proposal allows a local utility to provide up to 5% of its load through local sources. TVA has now clarified that any local generation must be documented, metered, operated, and connected according to TVA standards. No single generation project can exceed 5MVA, and all projects must improve the Valley’s carbon position. Financially speaking, local generation will offset the wholesale purchase of electricity. There are no surprises in the updated redline agreement. The new version cleans up some legal language, and as communicated in Dan Pratt’s letter of October 21, the rate cap now includes all rate changes except those driven by fuel prices or those intended to be revenue-neutral in the aggregate. TVA has not provided any further definition regarding its prohibition on the “facilitation” of power consumption from a source other than TVA, though they have acknowledged that further definition is needed. ________________________________________________________________________________ Master Page # 8 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 TVA Long-Term Partnership Proposal November 12, 2019 Page 2 On November 20, the afternoon of our meeting, the group of 22 utilities who have not signed the TVA proposal will meet again in Nashville. At this meeting, we will discuss TVA’s updated contract language and receive a legal analysis. To further HU’s due diligence, Elaine Johns, President/CEO of Enervision, is attending our November meeting to present information on the power supply environment outside of TVA. Ms. Johns and her team have considerable experience in the wholesale energy market and are currently working with several utilities in the Valley conducting similar due diligence reviews. Among others, Envision’s clients include nearby Joe Wheeler Electric and Cullman Electric Cooperatives. Ms. Johns presentation is attached for your review. By the December meeting, I believe we will have a good understanding of the options before us. We will be fully informed on TVA’s agreement language, aware of the thoughts of other utilities that have not signed the long-term partnership proposal, aware of the decision timeline for MLGW and other utilities that may separate from TVA, knowledgeable of power supply rates outside the Valley, and cognizant of the complications related to transmission access. Let’s plan to discuss our next steps at the December 18 meeting. ________________________________________________________________________________ Master Page # 9 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Wholesale Power Price Study for November 20, 2019 Confidential ________________________________________________________________________________ Master Page # 10 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 1 Introduction to EnerVision Confidential ________________________________________________________________________________ Master Page # 11 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 2 Who am I? Who is EnerVision? Elaine H. Johns Founder and President/CEO One of the founders and current President/CEO of EnerVision, where she leads the company’s nationwide consulting and business development efforts • Over 35 years of consulting experience in areas ranging from strategic planning, power supply planning, utility rates, marketing, and economic analysis • Formerly 13-year employee of Oglethorpe Power (G&T in Georgia) • Georgia Tech President’s Advisory Board, College of Engineering Advisory Board, Council of Industrial and Systems Engineers, Institute of Industrial Engineers (Fellow) • • • • • • • EVI is a management and technical consulting firm in an electric utility industry Came out of the 1997 OPC Restructuring Employee owned since 1998 Over 35 states, more than 150 clients Staff in GA, NC, TN & TX Headquartered in Atlanta 3 ________________________________________________________________________________ Master Page # 12 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Markets We Serve  Electric Cooperatives (Primary) – – – – Distribution G&Ts Statewide Organizations Affiliated Organizations (NRECA, CFC, etc.)  Municipal Utilities  Renewable Resource Developers  Other Select Clients – Government Groups – Private Entities – Large Power Users Confidential ________________________________________________________________________________ Master Page # 13 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 4 Services / Business Lines Management Consulting Emerging Energy Solutions Power Supply Confidential ________________________________________________________________________________ Master Page # 14 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 5 EnerVision’s Power Supply Team  Avg 24.2 years among 9 senior staff  Strengths: – Power supply planning and analysis • Integrated Resource Plans – Wholesale power supply solicitations & evaluations – Contract negotiations and administration Confidential ________________________________________________________________________________ Master Page # 15 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 6 Wholesale Power Market Study – Today’s Agenda  Wholesale Power Overview  Study Approach  Study Methodology  Study Findings  TVA Background  TVA Transmission Access  Next Step Options Confidential ________________________________________________________________________________ Master Page # 16 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 7 Wholesale Power Overview  Wholesale power transactions take three general forms: 1. Full Requirements – supplier meets the 100% needs of purchasers in all hours 2. Partial Requirements – supplier meets only a specified portion of purchasers’ needs, typically wrapping around other resources to supplement existing supply 3. Structured Transaction – supplier provided an agreed quantity of capacity and energy in specified hours, such as a 7x24 block (same quantity delivered in every hour of the specified period)   Wholesale sellers, other than governmental entities and G&T cooperatives (RUS borrowers), fall under Federal Energy Regulatory Commission (FERC) jurisdiction Per FERC orders, wholesale capacity and energy are typically sold separately from transmission service, with many older, bundled transactions grandfathered Confidential ________________________________________________________________________________ Master Page # 17 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 8 Wholesale Power Overview  Types of Suppliers: 1. Investor-owned utilities (IOUs) typically sell using cost-based rates in their geographic territories 2. Independent marketers and marketing affiliates of IOUs have the flexibility to sell at market-based prices  Example 1 – Georgia: most wholesale power sold at market-based rates by suppliers easily able to underbid Georgia Power’s cost-based rate – Constellation (Exelon subsidiary) – Morgan Stanley Capital Group – Southern Power Company  Example 2 - North Carolina: Duke makes many wholesale sales, all at costbased rates, but other suppliers have been making inroads with market-based rates – Southern Power Company – NTE Energy – Morgan Stanley Capital Group Confidential ________________________________________________________________________________ Master Page # 18 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 9 Wholesale Power Overview  Outside of the Southeast, RTOs and ISOs coordinate the electric grid in their multi-state territory, including – – – –   Operation of the region’s electricity grid, Administration of the region’s wholesale electricity markets, Reliability planning for the regions bulk electric system, and Responsibility of the transmission network. RTOs/ISOs fall under FERC jurisdiction and operate their own markets independently of other each other. Independent markets under each RTO/ISO generally include Energy, Capacity, Financial Transmission Rights, and Ancillary Services markets. Of interest to TVA LPCs, PJM and MISO markets Confidential ________________________________________________________________________________ Master Page # 19 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 10 11 ________________________________________________________________________________ Master Page # 20 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Study Approach      Provide data indicative of transactions that utilities similar to Huntsville, and similarly situated, might be offered in the marketplace Report historical average pricing for full requirements sales made by utilities and reported in publicly-available FERC Form 1 Project future escalation of the provided utility prices Pricing offered by utility affiliates and other marketers What is not included: – Pricing out of demand and energy rates of reported utilities against specific customer usage characteristics – Actual costs to transmit power to TVA system (used estimate of $3/MWh) Confidential ________________________________________________________________________________ Master Page # 21 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 12 Study Methodology     Actual wholesale pricing sought from IOU sellers and marketers around Huntsville FERC Form 1 annual reports from utilities and FERC Quarterly Reports from marketers indicating requirements sales reviewed for relevant transactions Full requirements transactions selected from those in Form 1s reporting customers with RQ designation in order to present a more apples-to-apples comparison Prices used include an estimated cost of transmission of $3/MWh to better reflect the all-in cost Huntsville will see Confidential ________________________________________________________________________________ Master Page # 22 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 13 Study Methodology  Utilities reporting full requirements customers in their Form 1s and used in the study – Alabama Power – Appalachian Power – Duke Energy Carolinas – Duke Energy Progress – East Kentucky Power Coop – Florida Power & Light – Kentucky Utilities – M&A Electric Power Coop – South Carolina E&G / Dominion – Santee Cooper – Union Electric  Marketer transactions (full requirements) of which EVI has working knowledge/familiarity – – – – –  Southern Power Morgan Stanley Capital Group Constellation Duke Energy Carolinas NTE Energy RTO published market and auction rates by zone – PJM – MISO Confidential ________________________________________________________________________________ Master Page # 23 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 14 Study Findings Full Requirements Wholesale Power Cost per kWh Alabama Power Company Appalachian Power Duke Energy Carolinas Duke Energy Progress East Kentucky Power Coop Entergy Louisiana Florida Power & Light Kentucky Utilities M&A Electric Power Coop South Carolina E&G Santee Cooper Union Electric Co 2013 6.7¢ 6.6¢ 6.0¢ 6.9¢ 7.3¢ 2014 6.5¢ 7.0¢ 5.6¢ 7.0¢ 7.2¢ 6.8¢ 6.2¢ 5.7¢ 6.0¢ 6.7¢ 6.0¢ 7.5¢ 6.2¢ 5.5¢ 6.2¢ 6.9¢ 5.7¢ 2015 6.2¢ 6.6¢ 5.6¢ 6.7¢ 7.1¢ 5.4¢ 7.1¢ 6.3¢ 5.9¢ 5.7¢ 6.2¢ 5.6¢ 2016 6.2¢ 6.4¢ 5.7¢ 6.2¢ 6.8¢ 4.9¢ 6.5¢ 6.4¢ 6.0¢ 5.1¢ 5.9¢ 5.6¢ 2017 6.0¢ 6.9¢ 6.2¢ 6.5¢ 6.7¢ 5.7¢ 6.8¢ 6.6¢ 6.1¢ 5.2¢ 5.9¢ 5.3¢ 2018 5.9¢ 6.8¢ 5.6¢ 7.3¢ 6.7¢ 5.2¢ 6.8¢ 6.1¢ 5.9¢ 5.3¢ 5.9¢ 5.0¢ *Includes $3/MWh for transmission charges Confidential ________________________________________________________________________________ Master Page # 24 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 15 Confidential ________________________________________________________________________________ Master Page # 25 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 16 Confidential ________________________________________________________________________________ Master Page # 26 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 17 Study Findings Full Requirements Wholesale Power Cost per kWh Southern Power - 2018 / 2019 EMC 1 Municipal 1 EMC 2 EMC 3 EMC 4 EMC 5 EMC 6 EMC 7 EMC 8 '18 Q1 5.4¢ 3.9¢ 5.4¢ 6.7¢ 6.2¢ 5.4¢ 8.0¢ 4.2¢ 6.0¢ '18 Q2 4.7¢ 3.7¢ 5.1¢ 4.8¢ 3.2¢ 3.9¢ 4.8¢ 4.7¢ 4.8¢ '18 Q3 5.8¢ 3.7¢ 4.5¢ 5.9¢ 3.6¢ 4.6¢ 5.6¢ 5.7¢ 5.7¢ '18 Q4 4.4¢ 1.8¢ 5.9¢ 4.8¢ 3.8¢ 4.1¢ 3.8¢ 4.5¢ 4.4¢ '19 Q1 3.5¢ 3.4¢ 4.6¢ 3.7¢ 3.3¢ 3.3¢ 3.9¢ 3.9¢ 3.5¢ '19 Q2 4.7¢ 3.5¢ 4.6¢ 4.4¢ 3.6¢ 3.8¢ 4.6¢ 4.6¢ 4.7¢ *Includes $3/MWh for transmission charges Confidential ________________________________________________________________________________ Master Page # 27 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 18 Confidential ________________________________________________________________________________ Master Page # 28 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 19 Study Findings Full Requirements Wholesale Power Cost per kWh Morgan Stanley - 2018 / 2019 EMC 9 EMC 10 EMC 11 EMC 12 '18 Q1 4.5¢ 4.8¢ 4.0¢ 4.5¢ '18 Q2 4.5¢ 4.7¢ 4.0¢ 4.5¢ '18 Q3 4.5¢ 4.7¢ 4.0¢ 4.5¢ '18 Q4 4.5¢ 4.8¢ 4.0¢ 4.5¢ '19 Q1 4.5¢ 4.5¢ 3.7¢ 4.3¢ '19 Q2 4.5¢ 4.3¢ 3.7¢ 4.5¢ *Includes $3/MWh for transmission charges Confidential ________________________________________________________________________________ Master Page # 29 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 20 Confidential ________________________________________________________________________________ Master Page # 30 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 21 Study Findings Proposals for Similar Utilities Cost per kWh Range Marketer 1 Marketer 2 Marketer 3 Marketer 4 Low 7.3¢ 5.0¢ 4.3¢ 4.3¢ High 7.8¢ 5.4¢ 4.7¢ 6.7¢ Confidential ________________________________________________________________________________ Master Page # 31 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 22 *Range based on EnerVision’s experience with proposals for similar southeast utilities 23 ________________________________________________________________________________ Master Page # 32 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Study Findings MISO Wholesale Power Cost per kWh Zone 4 - SIPC Zone 5 - AMMO Zone 6 - BREC Zone 8 - EAI Zone 10 - SME 2013 4.9¢ 4.8¢ 4.5¢ 4.7¢ 4.3¢ 2014 5.8¢ 5.4¢ 5.3¢ 5.6¢ 5.4¢ 2015 4.1¢ 3.6¢ 3.6¢ 3.9¢ 3.9¢ 2016 4.4¢ 3.8¢ 3.9¢ 4.1¢ 4.2¢ 2017 4.5¢ 4.3¢ 4.3¢ 4.5¢ 4.7¢ 2018 4.6¢ 4.4¢ 4.6¢ 4.5¢ 5.0¢ 2017 5.3¢ 4.1¢ 3.7¢ 2018 6.2¢ 5.3¢ 4.7¢ PJM Wholesale Power Cost per kWh PJM Overall RTO Zone - AEP RTO Zone - EKPC 2013 5.4¢ 4.3¢ 3.9¢ 2014 7.2¢ 5.8¢ 5.7¢ 2015 5.7¢ 4.6¢ 4.3¢ 2016 5.0¢ 3.9¢ 3.6¢ *Includes $3/MWh for transmission charges 24 ________________________________________________________________________________ Master Page # 33 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Confidential ________________________________________________________________________________ Master Page # 34 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 25 26 ________________________________________________________________________________ Master Page # 35 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 The Utilities  The first step in projecting future power cost changes is looking at the year-to-year percentage changes reported by the utilities Historical Wholesale Power Cost Escalation Alabama Power Company Appalachian Power Duke Energy Carolinas Duke Energy Progress East Kentucky Power Coop Entergy Louisiana Florida Power & Light Kentucky Utilities M&A Electric Power Coop South Carolina E&G Santee Cooper Union Electric Co 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 -2.7% -4.8% 0.0% -2.3% -1.5% 7.4% -5.5% -3.4% 6.7% -1.4% -7.3% -0.6% 2.9% 7.8% -9.8% 1.4% -4.5% -7.8% 5.6% 11.5% -0.9% -1.7% -5.0% -0.3% -1.0% -10.2% 17.6% -9.3% 9.7% -5.7% -7.8% 3.7% 0.7% 1.4% 1.4% 1.2% 2.8% -6.9% -2.9% 6.4% 2.4% 2.6% -4.2% 3.3% -7.3% -10.1% 0.5% 1.9% 3.3% -9.9% -4.5% -0.6% -0.4% -4.5% -1.9% -0.3% -5.5% -4.9% Confidential ________________________________________________________________________________ Master Page # 36 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 27 The Utilities  None of the reported utilities indicated large-scale power supply purchases or capital additions, though all are focused on diversification and replacing power from plant retirements  Absent capital additions, escalation rates in wholesale power costs are driven primarily by fuel prices, which are generally projected to be flat for the next 3 to 5 years, then gradually increasing  Based on this information, EVI expects wholesale power costs for these utilities to be flat or have small increases, ~1% or so, in the near term Confidential ________________________________________________________________________________ Master Page # 37 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 28 The RTOs MISO Historical Wholesale Power Cost Escalation Zone 4 - SIPC Zone 5 - AMMO Zone 6 - BREC Zone 8 - EAI Zone 10 - SME 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 17.6% -30.0% 7.0% 4.2% 0.7% 13.5% -32.9% 3.5% 15.1% 1.2% 17.5% -30.6% 6.1% 11.6% 6.0% 18.8% -29.8% 5.8% 9.2% -0.9% 27.3% -29.1% 9.5% 10.6% 7.8% PJM Historical Wholesale Power Cost Escalation 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 PJM Overall 32.8% -20.6% -12.1% 6.5% 17.0% RTO Zone - AEP 37.4% -21.7% -14.5% 4.9% 28.1% RTO Zone - EKPC 45.5% -24.5% -16.4% 4.3% 25.7% 29 ________________________________________________________________________________ Master Page # 38 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 The RTOs  RTO/ISO rates tend to have wider swings due to nature of the markets’ structure; however, rates are consistently lower than TVA rates  Contractual arrangements could be structured to hedge against fuel price fluctuations  Administrative decisions about markets within each RTO, congestion, and auction results will impact the fluctuation  Absent major administrative changes, escalation rates in wholesale power costs are driven primarily by fuel price and transmission congestion, which are generally projected to be flat for the next 3 to 5 years, then gradually increasing  Based on this information, EVI expects wholesale power costs for these RTOs to fluctuate with short-term weather impacts, but overall be flat or have small increases in the near term Confidential ________________________________________________________________________________ Master Page # 39 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 30 Wholesale Power Market Implications  Wholesale pricing reported is based on transactions with existing customers in the service area of the selling IOU  IOUs often offer to sell at market-based prices to customers outside their services or have wholesale marketing affiliates which do so  With the opening of transmission systems by FERC over the last 20+ years (not applicable to TVA), cooperatives who are buying in the markets are receiving offers significantly below cost-based IOU prices Confidential ________________________________________________________________________________ Master Page # 40 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 31 TVA Background  Chartered under TVA Act of 1933, independence defined further in the Federal Power Act – Defines service territory “fence” provision – “Anti-cherrypicking” provision limits 3rd party access to TVA’s transmission system  Mostly exempt from FERC jurisdiction – Congressional oversight – Directors nominated by President with Senate confirmation – Board determines own wholesale rates and transmission tariffs  All-requirements wholesale contracts with 154 Local Power Companies – Including Huntsville, Joe Wheeler EMC, and Cullman EC – Termination provisions vary from 5- to 20-year notice requirement, primarily 5year and 10-year notice period Confidential ________________________________________________________________________________ Master Page # 41 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 32 Huntsville TVA Contract   All-Requirements Contract + 1980 Vintage, 1989 Term Amendment – Initial 20-year term, supplemented to 11-year term with – Automatic additional 1-year renewal term each anniversary. – Termination not earlier than 10 years notice  Rate Change Amendment – October 2018 – Instituted Demand charges, Grid access charges and TOU rates on LPC Confidential ________________________________________________________________________________ Master Page # 42 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 33 TVA Risk Factors  Each year as part of their SEC filing, TVA publishes and describes risks that could impact future projections and operations, including – New laws and environmental regulation – Administrative orders to divest or reduce debt faster – Changes in TVA Act provisions which currently limit competition and 3rd party access – Loss of authority over rates, assets, etc. – Increased local DER – Loss of customer base • “…impacting cash flows, results of operations, or financial condition, and could result in higher rates, especially because of the difficulty in replacing customers on account of the fence.” Confidential ________________________________________________________________________________ Master Page # 43 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 34 TVA Transmission Access  Federal Power Act – “Anti-cherry picking” provision  TVA Act – “Inside the fence”  FERC Order 888 and 890 – Reciprocity pro forma, required by public and non-public utilities Confidential ________________________________________________________________________________ Master Page # 44 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 35 TVA Transmission Access  Pro Forma Reciprocity language: – Transmission Customer receiving Transmission Service agrees to provide comparable Transmission Service that it is capable of providing to TVA on similar terms and conditions – This reciprocity requirement applies not only to the Transmission Customer, but also all parties to a transaction that involves the use of Transmission Service… – This reciprocity requirement also applies to any Eligible Customer that owns, controls or operates transmission facilities that uses an intermediary, such as a power marketer, to request Transmission Service  TVA’s Definition “Eligible Customer” – Definition does not include customers that fall under Anti-cherry picking provisions Confidential ________________________________________________________________________________ Master Page # 45 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 36 TVA Transmission Access - LPC Options  Shake the trees for TVA to interconnect to new LPC-constructed transmission lines and provide coordination services – Voltage support, backup power, etc.  Appeal to FERC for reciprocal TVA Transmission service – Can only be exerted by FERC jurisdictional transmission utility already providing transmission service to TVA – Cannot be asserted by a power supplier that does not have a FERCjurisdictional Open Access Transmission Tariff (OATT) and does not provide transmission service to TVA – If TVA refused, the transmission utility could revoke its transmission service to TVA (Options confirmed by FERC counsel) Confidential ________________________________________________________________________________ Master Page # 46 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 37 TVA Alabama LPCs 38 ________________________________________________________________________________ Master Page # 47 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Even though Huntsville borders Joe Wheeler EMC, there are no existing transmission lines directly between the two (see highlight). Confidential ________________________________________________________________________________ Master Page # 48 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 39  Lack of direct transmission between Huntsville and Joe Wheeler confirmed via the US Energy Information Administration  Huntsville would need to build new transmission lines or wheel power through TVA via surrounding utilities – Arab EC – Athens, AL Confidential ________________________________________________________________________________ Master Page # 49 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 40 Next Step Options 1. Sign Long Term Agreement – 20-year evergreen contract – Begin receiving TVA credit (but still subject to cost increases) 2. Stay in Current Contract - don’t sign, don’t notice of exit – Gives you 11+ years to work through transmission – Could obtain Huntsville-specific power supply proposals (RFP)* – Not a “preferred” TVA LPC and forgo credit 3. Stay in Current Contract - provide 10-year notice to exit – Gives you 10 years to work through transmission – Should obtain Huntsville-specific power supply proposals with other LPCs (RFP)* – Forgo credit and TVA may pull back on programs or services currently provided * See next slides: transmission Confidential ________________________________________________________________________________ Master Page # 50 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 41 Next Step – Bulk Transmission   Process could run in parallel to Wholesale Power RFP Research of all options on-going – TVA must provide interconnection and coordination services – LPC would need to provide notice prior to filing FERC case • Otherwise, no aggrieved party and no grounds for case – Choose FERC-jurisdiction transmission provider to leverage OATT reciprocity terms • Transmission provider would likely go to bat for LPC only after Wholesale Power agreement in place – Alabama Power is sole owner of their transmission lines in Alabama • First need to determine TVA Transmission access – or lack of access • Then, should be less complicated process than Ga of System Impact Studies, Facilities and Planning Studies to determine existing and new transmission facilities needed Confidential ________________________________________________________________________________ Master Page # 51 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 42 Summary  Wholesale Power Overview  Study Approach  Study Methodology  Study Findings  TVA Background  TVA Transmission Access  Next Step Options Confidential ________________________________________________________________________________ Master Page # 52 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 43 MEMORANDUM To: Electric Board From: Wes Kelley, President & CEO Date: November 12, 2019 Subject: TVA Valley Incentive Program Investment Credit Agreement – The Boeing Company The Valley Incentive Program (VIP) is an economic development incentive program offered by TVA through Huntsville Utilities. VIP offers financial incentives to qualifying power customers who contribute to the economic development of the Tennessee Valley region. Award amounts are based on a customer’s five-year projections and actual performance in capital investment, jobs added or retained, average wages paid, and annual load factor. The Boeing Company met the program qualifiers of a minimum projection of 250-kilowatt peak monthly demand, minimum projection of 25 employees or five-year growth of 25 million kWh, no plans to reduce workforce by 50 percent or more, and financial viability. I recommend approval of the TVA Valley Incentive Program Investment Credit Agreement between TVA, City of Huntsville, and The Boeing Company and submission to the Huntsville City Council. ________________________________________________________________________________ Master Page # 53 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM To: Electric Board From: Wes Kelley, President/CEO Date: November 12, 2019 Subject: Electric Budget Update Huntsville Utilities is a non-profit, governmental unit. As such, it does not pay taxes per se, but HU does pay the City of Huntsville a Payment-In-Lieu-of-Taxes (PILOT). This “tax-equivalent” payment is based mainly on the size of the Electric system’s fixed assets. In FY19, HU initially underpaid the City’s PILOT but corrected the underpayment when identified as part of a yearend review. The payment was low because it did not adequately consider the impact of the fiber project on HU’s fixed assets. With the fiber project is nearing completion, the fixed assets value is rising, and this has now been factored into future PILOT payments. The updated PILOT figures necessitate an increase in FY20’s budgeted expenses by $3.88M. Knowing HU’s Electric cash is low, the staff has worked diligently to find cuts to offset this increase. Thanks to their efforts, an estimated $4.95M will be removed from the FY20 capital budget. This will more than offset the $3.88M needed for the PILOT, accounts for $1.11M in capital work encumbered in FY19 that will be paid in FY20, and an additional $650k to address a recently discovered problem with a large power transformer. This results in an estimated bottom-line increase of $170k for FY20’s estimated year-end cash position. The Electric System ended FY19 with more cash than expected. The FY19 budget estimated ending cash at $60M; however, the actual year-end cash position was $65.1M. The FY2020 budget projected FY20’s year-end cash to be $59.4M, but that figure is now $59.5M. This is still lower than the ending cash in FY19, but cash is expected to rise some in FY21 and begin climbing significantly in FY22. In summary, these changes will increase the current fiscal year’s budget for PILOT payments and decrease capital spending, netting to a small projected increase in end-of-year cash. ________________________________________________________________________________ Master Page # 62 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Five Year Electric Cash Balances $140,000,000 $130,563,229 $120,000,000 $105,958,780 $100,000,000 $86,354,827 $80,000,000 $60,044,760 $65,120,914 $59,358,586 $59,528,314 $60,000,000 $63,564,599 $40,000,000 $20,000,000 $FY19 Budget FY19 Actual Ending Cash FY 2020 Original FY 2020 Adjusted 30 Days of Cash FY 2021 FY 2022 FY 2023 FY2024 30 Days of Cash Plus Deposits ________________________________________________________________________________ Master Page # 63 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Original Projection + + COH PILOT Deferred Projects Carryovers Adjusted Projection FY19 Ending Cash $ 65,120,914 $ 65,120,914 Sales Revenue Operating Expenses Debt Service Taxes Capital Bond Proceeds $ 558,625,699 $ 506,899,538 $ 6,595,100 $ 11,559,796 $ 46,829,027 $ 7,495,434 $ 558,625,699 $ 506,899,538 $ 6,595,100 $ 15,437,941 $ 42,781,153 $ 7,495,434 FY20 Ending Cash $ 59,358,586 Adjustment Details Underpayment of fiber/electric PILOT Moontown 46kV line Northern Bypass Relocation Chrysler facility transformer Deferred AMI meter purchase Fiber savings Extra land budget Replace Hsv Primary transformer Transportation Carrovers - net FY19 Unbudgeted Carryovers TOTAL 3,878,146 (4,952,712) $ 3,878,146 904,838 $ (4,952,712) $ 904,838 $ 59,528,314 3,878,146 (800,000) (1,600,000) (325,000) (683,000) (1,994,712) (200,000) 650,000 (205,678) 1,110,516 3,878,146 (4,952,712) 904,838 ________________________________________________________________________________ Master Page # 64 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM To: Wes Kelley, President/CEO Electric Board From: Ted Phillips, CFO Date: November 12, 2019 Subject: Standard and Poor’s Bond Rating Review Standard and Poor’s (S&P) conducted a review of our electric system’s debt and lowered its rating of the electric system’s revenue bonds from at AA to AA-, with a stable outlook. A copy of the report is attached to this memo. S&P has seven criteria upon which they build their ratings. In two of these areas, Market Position and Industry Risk, S&P rated us Extremely Strong. In three areas, Economic Fundaments, Operational Management Assessment, and Debt & Liabilities, S&P rated us Very Strong. In Coverage Metrics, S&P only rated us Strong. It appears that S&P was not particularly concerned with our debt coverage ratios, but they do have issue with our Fixed Cost Coverage (FCC). S&P feels that the FCC, which measures coverage of direct debt service and our share of TVA’s fixed costs in relation to our availability fees, is too low. The FCC has not only been an issue for us. All the major cities in the TVA’s region (Knoxville, Nashville, Memphis, and Chattanooga) have seen their debt rating lowered by S&P because they felt the FCC was too low. The rate increases already approved by the Huntsville City Council will help with our FCC. Nevertheless, even with these increases, S&P still wants to see higher availability fees. S&P also rated us only Adequate, in the area of Liquidity and Reserves. This is an area that we are focused on, and we should see improvement in the next few years, as less money spent on capital and more fiber revenues come in. I will be happy to answer any questions you may have about the rating at the board meeting next week. ________________________________________________________________________________ Master Page # 65 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville, Alabama; Retail Electric Primary Credit Analyst: Jeffrey M Panger, New York (1) 212-438-2076; jeff.panger@spglobal.com Secondary Contact: Scott W Sagen, New York (1) 212-438-0272; scott.sagen@spglobal.com Table Of Contents Rationale Outlook Enterprise Risk Financial Risk WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 1 ________________________________________________________________________________ Master Page # 66 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville, Alabama; Retail Electric Credit Profile Huntsville elec Long Term Rating AA-/Stable Downgraded AA-/Stable Downgraded Huntsville elec sys rev warrants Long Term Rating Rationale S&P Global Ratings lowered its rating on the city of Huntsville, Ala.'s electric revenue bonds to 'AA-' from 'AA'. The outlook is stable. The downgrade primarily reflects the application of our "U.S. Municipal Retail Electric And Gas Utilities: Methodology And Assumptions" criteria (published Sept. 27, 2018). Under the revised criteria, we believe that Huntsville's fixed cost coverage (FCC) and liquidity metrics no longer support the previous rating. The net revenue of the city's electric system secures the bonds. At fiscal year-end 2018, the utility had $79 million of long-term debt outstanding. The rating reflects our view that Huntsville has a very strong enterprise risk profile, and a strong financial risk profile. The enterprise risk profile reflects our view of Huntsville's: • Very strong service area economic fundamentals, reflecting a deep and diverse service area highlighted by more than 191,000 customers, with residential customers accounting for almost 50% of revenue and energy sales. Median household incomes that are slightly above the county average further support our view; • Very strong operational and management assessment (OMA), reflecting Huntsville's role as a distributor of Tennessee Valley Authority (TVA) power and energy, greatly reducing financial and operating risk to the system. We view the utility's financial planning as credit-supportive, highlighted by a regularly updated strategic plan and annually updated financial forecasts and capital plans. However, rate-setting practices are mixed. On the one hand, we believe that the automatic pass-through of TVA power costs to Huntsville customers is credit-supportive. On the other hand, the utility has had a mixed record on gaining approval for base-rate increases; • Extremely strong market position, due to average revenue per kilowatt-hour (kWh) that was just 84% of the state average in 2017. We anticipate that Huntsville will continue to maintain an extremely strong market position, as the utility adopted a modest rate increase for 2019, and projects small rate increases over the next several years; and • Extremely strong industry risk relative to other industries and sectors. The financial risk profile reflects our view of the utility's: • Strong coverage metrics. Although we note an improving trend, FCC has averaged just 1.22x over fiscal years 2016-2018. Projections suggest coverage levels in the 1.3x range, which could modestly improve to the 1.4x range if the utility opts to sign a new power supply contract with TVA, which is offering a discount to off-takers signing WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 2 ________________________________________________________________________________ Master Page # 67 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville, Alabama; Retail Electric longer contracts; • Adequate liquidity and reserves for a distribution utility. At fiscal year-end 2018, the utility had about $15.5 million in unrestricted cash and investments, measuring just 12 days of operating expenses, levels that we consider to be very weak. However, projections suggest modest improvement over the next five years, which informs our forward-looking view of Huntsville's liquidity. We understand that if Huntsville does extend its TVA contract, the utility plans to retain the discount, which could further bolster liquidity; and • Very strong debt and liabilities profile for a distribution utility, suggested by just $79 million in debt, representing 25% of total capitalization; and a modest capital plan, which we understand will be internally funded. We have applied a one-notch positive holistic adjustment to arrive at the final 'AA-' rating based on our view of peers, most notably other TVA distributors. Outlook The stable outlook reflects the limited operating risks that Huntsville faces as a distributor of TVA power. We premise the outlook on management's forecast of improved FCC in the 1.2x-1.3x range, and projection of improving liquidity toward the back end of the five-year forecast. Upside scenario Given our forward-looking view of FCC and liquidity, we do not expect to raise the rating over the next two years. Downside scenario Should FCC fail to approximate forecast levels, we would likely lower the rating. As well, should liquidity fail to, at a minimum, meet forecast levels, a downgrade would likely follow. Enterprise Risk Economic fundamentals: Very strong Our assessment of Huntsville's economic fundamentals reflects a deep and diverse service area. The utility provides electric service to about 191,000 customers in northern Alabama. Residential customers account for almost 50% of revenue and energy sales, and customer concentration is not a credit concern. We believe that the Huntsville economy, which is anchored by the military, aerospace, and high technology industries, has performed relatively well in recent years, with notable investment in automotive and aerospace. These sectors provide well-paying jobs that support county median household incomes that are 105% of the national average. Operational Management Assessment (OMA): Very strong Huntsville's OMA is highlighted by all-requirement energy purchases from TVA, under a rolling 10-year contract. We understand that TVA has offered a 3.1% discount on wholesale power prices to its off-takers as an inducement to extend contracts to a rolling 20 years, and that Huntsville is considering an extension, with a decision expected in the next few months. TVA has a diverse set of generating assets, with about one-quarter of energy needs coming from coal-fired units. In WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 3 ________________________________________________________________________________ Master Page # 68 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville, Alabama; Retail Electric response to existing and proposed environmental regulations, TVA has retired a number of its older, less-efficient units, replacing them with combined-cycle (natural gas) units, and the Watts Bar (nuclear) Unit 2. We factor in TVA's (and hence Huntsville's) exposure to carbon regulation (which we view as inevitable) in our current rating. However, we do not factor in the impact of such regulation, as it is currently unknowable, and will not be clear until reduction regimes are adopted and TVA formulates a compliance strategy. In our view, Huntsville's financial and capital planning are credit strengths. The utility annually updates both and regularly updates its strategic plan. The utility does not transfer money to the city's general fund (per TVA contract requirements), which we view as credit-positive. However, the utility does not have formal policies (beyond minimum covenanted requirements in its bond documents) related to coverage, which we view as a credit weakness, but we view as credit supportive formal policies related to liquidity and debt. We believe that the automatic pass-through of TVA power costs to Huntsville customers is credit-supportive. However, the utility's record of adopting base-rate increases has been uneven. In 2016, the board proposed two residential and small commercial rate adjustments that, taken together, would have increased the monthly bill of the average residential user by approximately 3.74%. However, the council declined to implement the board's proposed rate increase, but subsequently approved a 2.75% increase that went into effect in 2017. We believe that the adopted increase was insufficient to promote coverage of fixed costs and liquidity supportive of the current rating. However, we do note adoption of a 1.5% increase effective Jan. 1, 2019; a 1.3% increase effective Oct. 1, 2019; and adopted rate increases through 2022 (0.5% annually), which we believe will prospectively support the revised 'AA-' rating. Market position: Extremely strong According to the U.S. Department of Energy's Energy Information Administration, Huntsville's average revenue per kWh was 84% of the state average in 2017, the most recent year of available comparative information. Our assessment of the utility's competitive position is enhanced by the automatic pass-through of TVA power costs to ratepayers. We do not anticipate that the recent rate increases outlined above will change our assessment of Huntsville's comparative positioning. Huntsville, like the vast majority of public power utilities, has rate-setting autonomy, relying on its city council to adopt proposed rate increases. Industry risk: Extremely strong Consistent with "Methodology: Industry Risk", published Nov. 19, 2013, we consider industry risk for municipal retail electric and gas utilities covered under these criteria as very low, and therefore "extremely strong", as compared with other industries and sectors. Financial Risk Coverage metrics: Strong As the utility has a relatively small amount of debt outstanding, amortization costs are very manageable, and debt service coverage has been robust, at above 8x over the past three years. However, FCC has been considerably thinner, averaging just 1.22x over this timeframe, although we note an improving trend that produced 1.31x coverage in 2018. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 4 ________________________________________________________________________________ Master Page # 69 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville, Alabama; Retail Electric Fixed-cost coverage is S&P Global Ratings' internally adjusted coverage metric that imputes recurring, debt-like costs onto the utility's coverage metrics, such as demand charges, as well as treating net operating transfers out as if they were operating expenses. Beginning in April 2011, the TVA adjusted its rate structure to include a demand charge to cover most fixed costs, including debt service associated with generating plants. Accordingly, we calculate a fixed-cha coverage ratio for TVA's distribution utilities, which measures coverage of direct debt service and the utility's share of TVA's fixed costs. We use an annual demand charge of 27% of purchased-power costs for TVA's distribution utilities. The utility's financial projections suggest that adopted rate increases should continue to support FCC in the range of 1.3x, which could improve to 1.4x if the utility enters into the new TVA contract and retains the discount, as management has indicated it plans to do if it extends its contract with TVA. Liquidity and reserves: Adequate Our assessment of Huntsville's liquidity and reserves is informed by unrestricted cash and investments that we view as weak, and projections that suggest modest improvement, based on already adopted rate increases. At fiscal year-end 2018, Huntsville had just $15.5 million in unrestricted cash (excluding customer deposits), which measured just 12 days of operating expenses, a level we consider very weak, even for a distribution utility with limited operational risk. The utility's financial projections, which are based on already approved rate increases, suggest that management anticipates a near doubling of unrestricted cash in 2019, with liquidity in the 18-57 day range over the next five years--levels that would be, in our opinion, marginally better. We understand that if Huntsville enters into the new TVA contract, management expects to retain the 3.1% discount, which in addition to boosting coverage, should result in improved liquidity, projected in the 23-113 day range. Debt and liabilities: Very strong Our view of Huntsville's debt and liabilities profile is informed by low direct debt at $79 million outstanding, representing 25% of total capitalization, which we consider very strong for a distribution utility. Capital needs are manageable at $129 million over the next five years, which the utility expects to finance with internally generated funds, so we anticipate an improving trend in the near term, although not so significant as to change our assessment of the utility's debt and liabilities profile or our rating. The electric system has a net pension liability of about $30 million, and we view this "soft debt" as manageable within the context of operating expenses (almost $500 million) and its very strong debt profile. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 5 ________________________________________________________________________________ Master Page # 70 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Copyright © 2019 by Standard & Poor’s Financial Services LLC. All rights reserved. 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WWW.STANDARDANDPOORS.COM/RATINGSDIRECT OCTOBER 25, 2019 6 ________________________________________________________________________________ Master Page # 71 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM DATE: November 12, 2019 TO: Ronnie Boles Thomas Winstead George Moore FROM: Beverly Hughes SUBJECT: 2020 BOARD & COUNCIL MEETINGS - DRAFT Dorothy Huston Jim Batson Gripp Luther Following is the draft schedule for Board Meetings to be held during 2020. Also included are the Council Meeting Dates for items that will require City Council approval. Please let me know if you have any conflicts. The final schedule will be provided in December. 2020 Meetings Gas & Water Boards Time Electric Board Time City Council Tuesday January 28, 2020 8:30 a.m. Wednesday January 29, 2020 8:30 a.m. February 27, 2020 Tuesday February 18, 2020 8:30 a.m. Wednesday February 19, 2020 8:30 a.m. March 12, 2020 Tuesday March 24, 2020 8:30 a.m. Wednesday March 25, 2020 8:30 a.m. April 23, 2020 Tuesday April 21, 2020 8:30 a.m. Wednesday April 22, 2020 8:30 a.m. May 28, 2020 Tuesday May 26, 2020 8:30 a.m. Wednesday May 27, 2020 8:30 a.m. June 25, 2020 Tuesday June 23, 2020 8:30 a.m. Wednesday June 24, 2020 8:30 a.m. July 23, 2020 Tuesday July 28, 2020 8:30 a.m. Wednesday July 29. 2020 8:30 a.m. August 27, 2020 Tuesday August 25, 2020 8:30 a.m. Wednesday August 26, 2020 8:30 a.m. September 24, 2020 Tuesday September 22, 2020 8:30 a.m. Wednesday September 23, 2020 8:30 a.m. October 22, 2020 Tuesday October 27, 2020 8:30 a.m. Wednesday October 28, 2020 8:30 a.m. November 19, 2020 Tuesday November 17, 2020 8:30 a.m. Wednesday November 18, 2020 8:30 a.m. December 17, 2020 Tuesday December 15, 2020 8:30 a.m. Wednesday December 16, 2020 8:30 a.m. January 28, 2021 Possible Joint Board Meetings: Wednesday, May 13, 2020 @ 8:30 a.m. – CEO Performance Review Wednesday, August 12, 2020 @ 8:30 a.m. – FY2021 Budget Review cc: Warne Heath Bob Miller Revised 11/08/2019 ________________________________________________________________________________ Master Page # 72 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Monthly O&M Purchases Greater Than $25,000 For the period begining: Vendor Electric 10/1/19 and ending: 10/31/19 Fiber Water Gas Joint Total ALABAMA DEPARTMENT OF REVENUE 0000087001 $1,660,664.24 $0.00 $157,220.89 $64,002.26 $0.00 $1,881,887.39 CITY OF HUNTSVILLE 0000010268 $2,857,508.91 $1,620,545.37 $3,516,063.57 $100,635.93 $0.00 $8,094,753.78 CITY OF MADISON 0000012676 $243,769.17 $0.00 $0.00 $0.00 $0.00 $243,769.17 CITY OF NEW HOPE 0000012270 $0.00 $0.00 $98,511.18 $0.00 $0.00 $98,511.18 CITY OF NEW HOPE - SEWER 0000012483 $0.00 $0.00 $47,388.81 $0.00 $0.00 $47,388.81 MADISON CO BD OF COMMISSIONERS 0000010728 $1,000,940.98 $0.00 $1,272,153.94 $0.00 $0.00 $2,273,094.92 AMERICAN MIDSTREAM LLC 0000012127 $0.00 $0.00 $0.00 $69,576.18 $0.00 $69,576.18 BP ENERGY 0000010190 $0.00 $0.00 $0.00 $252,839.25 $0.00 $252,839.25 COLUMBIA GULF TRANSMISSION LLC 0000013029 $0.00 $0.00 $0.00 $87,163.17 $0.00 $87,163.17 PLAINS ALL AMERICAN PIPELINE LP 0000013755 $0.00 $0.00 $0.00 $66,000.00 $0.00 $66,000.00 SOUTHERN NATURAL 0000011079 $0.00 $0.00 $0.00 $334,898.45 $0.00 $334,898.45 TENNESSEE ENERGY ACQUISITION CO 0000011138 $0.00 $0.00 $0.00 $111,920.00 $0.00 $111,920.00 TENNESSEE GAS PIPELINES 0000011139 $0.00 $0.00 $0.00 $160,341.21 $0.00 $160,341.21 TENNESSEE VALLEY AUTHORITY 0000011141 $39,511,384.08 $0.00 $0.00 $0.00 $0.00 $39,511,384.08 ALABAMA PUBLIC SERVICE 0000010057 $0.00 $0.00 $0.00 $27,287.00 $0.00 $27,287.00 AMERICAN PUBLIC GAS ASSOCIATION 0000010092 $0.00 $0.00 $0.00 $67,178.02 $0.00 $67,178.02 BANK OF NEW YORK 0000010151 $0.00 $0.00 $1,001,874.63 $0.00 $0.00 $1,001,874.63 BANK OF NEW YORK MELLON 0000010152 $0.00 $0.00 $0.00 $243,045.43 $0.00 $243,045.43 CAPSTONE UTILITY SUPPLY INC 10232-1 $31,173.00 $0.00 $0.00 $0.00 $0.00 $31,173.00 FEDERAL INSURANCE COMPANY 0000013402 $72,540.00 $0.00 $0.00 $0.00 $0.00 $72,540.00 HEATH CONSULTANTS INC 10522-1 $0.00 $0.00 $0.00 $0.00 $377,952.75 $377,952.75 JAMES CARPETS OF HUNTSVILLE 0000012783 $51,169.00 $0.00 $0.00 $0.00 $0.00 $51,169.00 MADISON COUNTY AUTO PARTS INC 0000013382 $0.00 $0.00 $0.00 $25,558.56 $0.00 $25,558.56 Data Refresh: 11/11/19________________________________________________________________________________ 10:53:08AM Master Page # 73 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Page 1 of 2 Vendor Electric MIDSOUTH PAVING INC 0000012959 OMNETRIC CORP 13104-1 POSTMASTER Fiber Water Gas Joint Total $0.00 $0.00 $42,181.63 $99,347.63 $0.00 $141,529.26 $90,778.00 $0.00 $0.00 $0.00 $0.00 $90,778.00 0000010931 $0.00 $0.00 $0.00 $0.00 $78,000.00 $78,000.00 SUCCESSFACTORS INC 0000013195 $0.00 $0.00 $0.00 $0.00 $74,823.01 $74,823.01 THE TRAVELER'S INDEMNITY CO 0000013826 $151,834.71 $0.00 $43,007.95 $42,770.34 $0.00 $237,613.00 USIC HOLDINGS INC 13733-1 $0.00 $0.00 $0.00 $0.00 $34,146.00 $34,146.00 VERIZON WIRELESS LLC 0000011231 $0.00 $0.00 $0.00 $0.00 $29,605.13 $29,605.13 VOLT POWER LLC 0000013586 $31,028.92 $0.00 $0.00 $0.00 $0.00 $31,028.92 Summary for All Vendors Grand Total Data Refresh: 10/1/19 - 10/31/19 $45,702,791.01 $1,620,545.37 $6,178,402.60 $1,752,563.43 $594,526.89 11/11/19________________________________________________________________________________ 10:53:08AM Master Page # 74 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 $55,848,829.30 Page 2 of 2 Electric Capital Progress Report Fiscal Year 2020 Project Name/Description FY20 Budget Encumbered October FYTD incl. Encumbered % FY20 Budget 50 O&M MATERIALS Maintenance of system/pole change outs MST's, Closures, Strand, Fiber, Pole Hardware, Vaults, ETC… $ $ 50 O&M MATERIALS TOTAL 51 NEW CONSTRUCTION MATERIALS Internally Scheduled $ 3,550,000 $ 39,158.84 $ 27,879.51 Open side storage building; 150' X 80'; concrete floor General Development and Extensions AMI Modules - Purchase and Install by Contractor Moontown (46kV Line from Moontown to Chase) Capshaw - Complete Substation & Transmission Tap Underground 46kV to VBC (duct bank) Fiber New Development Tier Two - COH and Green Fields Fiber Network Build $ $ $ $ $ $ $ $ 200,000 4,730,000 8,651,597 1,750,000 1,625,000 1,500,000 460,000 9,994,712 $ $ $ $ $ $ $ $ 705,633.50 30,772.00 16,591.12 - $ $ $ $ $ $ $ $ 413,744.35 1,386,582.18 2,965.65 488,555.03 51 NEW CONSTRUCTION MATERIALS TOTAL 52 RENEW AND REPLACE MATERIALS Internally Scheduled $ 28,911,309 $ 752,996.62 Replacement of battery banks in five substations 1996 HVAC AC-1 FC-1J / Split / Nat.Gas 2.5 Tons (Chase J) 1996 HVAC AC-2 FC-2J / Split / Nat.Gas 4 Tons (Chase J) 1996 HVAC AC-3 FC-3J / Split / Nat.Gas 2.5 Tons (Chase J) 1996 HVAC AC-4 FC-4J / Split / Nat.Gas 5 Tons (Chase J) 1996 HVAC AC-5 FC-5J / Split / Nat.Gas 1.5 Tons (Chase J) Chrysler - Replace 1956 Transformer Replace 10 Obsolete Breakers Downtown Electric Switch Replacement Security Equipment Upgrade Fiber Road Relocations Security Equipment Upgrade Externally Scheduled Martin Road (Wall Triana to Old Jim Williams) Memorial Parkway Relocates (Mastin Lake) Northern Bypass Relocates Misc upgrades & COH/Roadway Relocations $ $ $ $ $ $ $ $ $ $ $ $ 50,000 10,000 16,000 10,000 20,000 9,000 325,000 300,000 400,000 30,000 90,000 30,000 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 450,000 1,200,000 1,800,000 225,000 $ $ $ $ 10,651.11 $ $ $ $ 238.50 11,278.80 $ $ $ $ 238.50 21,929.91 0.1% 0.0% 0.0% 9.7% $ 4,965,000 $ 10,651.11 $ 11,517.30 $ 22,168.41 0.4% 52 RENEW AND REPLACE MATERIALS TOTAL 3,500,000 $ 50,000 $ 39,158.84 $ $ - 26,462.17 $ 1,417.34 $ 65,621.01 1,417.34 1.9% 2.8% $ 67,038.35 1.9% $ $ $ $ $ $ $ $ 1,119,377.85 1,386,582.18 30,772.00 19,556.77 488,555.03 0.0% 23.7% 16.0% 0.0% 1.9% 0.0% 4.3% 4.9% $ 2,291,847.21 $ 3,044,843.83 10.5% $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ - - 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 70 LAND Land for Future Substations $ 70 LAND TOTAL $ 200,000 $ - $ - $ - 0.0% $ - $ - $ - 0.0% 9,500 $ 9,500 $ - $ $ - $ $ - 0.0% 0.0% - $ - $ - 0.0% 200,000 71 OFFICE EQUIPMENT 2006--- C1448SA-32 Commerical Ice machine (Chase - UG) 2007---C1448SA-32 Commerical Ice machine (Chase - OH) 71 OFFICE EQUIPMENT TOTAL $ $ $ 19,000 $ $ $ $ $ $ $ $ $ 30,000 7,500 8,000 11,682 25,169 25,169 15,000 15,000 $ $ $ $ $ $ $ $ 14,692.05 $ $ $ $ $ $ $ $ - $ $ $ $ $ $ $ $ 14,692.05 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 97.9% $ 137,520 $ 14,692.05 $ - $ 14,692.05 10.7% $ $ $ $ $ $ $ $ 159,000 286,398 20,000 6,000 171,868 233,753 244,000 130,000 $ $ $ $ $ $ $ $ 170,071.00 - $ $ $ $ $ $ $ $ - $ $ $ $ $ $ $ $ 170,071.00 - 107.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 72 TOOLS AND EQUIPMENT Megger EZ Thump Underground Cable Fault Locator Radiodetection RD 8100 Secondary fault locator Replace Infared Camera Replacement of 2 Radio Detection 8100 equipment Rotary 2 post lift/20,000lb capacity Rotary 2 post lift/20,000lb capacity EXFO FTB-1 OTDR, Central Office Test Equipment EXFO FTB-1 OTDR, Central Office Test Equipment 72 TOOLS AND EQUIPMENT TOTAL 73 TRANSPORTATION Replace cab/chassis #374 Replace truck #394 & aerial unit #394.8 Replace John Deere side-by-side Gator ATV #469.4 Enclosed trailer; 16'L x 8'W; dual axle Replace truck #313 & aerial unit #313.8 Replace truck #305 & aerial unit #305.8 Replace truck #384 & aerial unit #384.8 Replace truck #378 ________________________________________________________________________________ Master Page # 75 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Capital Progress Report Fiscal Year 2020 Project Name/Description Replace Sauber pole trailer #383.6 Replace wire puller #337.4 Replace truck #342 Replace truck #479 Replace cab/chassis #345 & aerial unit #345.8 Replace cab/chassis #304 & aerial unit #304.8 Replace cab/chassis #353 & aerial unit #353.8 Replace truck #480 Replace truck #309 & aerial unit #309.8 Replace chipper #397.9 Replace truck #396 & aerial unit #396.8 Replace truck #445 & aerial unit #445.8 Replace truck #451 Replace truck #105 Replace truck #302 Replace truck #207 Replace truck #435 Replace SUV #700 Replace Truck #754 Replace Truck #755 Replace mail van #400 Portable Air Compressor - Conduit Cable Installation Altec AP-45 Aerial Bucket Truck Skid Steer - New Construction Skid Steer 8X20 Trailer Direct Buried Plow - Installation of Fiber Cable Direct Buried Plow - 8X20 Trailer Vac Trailer $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 52,000 198,000 150,000 150,000 171,868 171,868 171,868 102,000 78,000 45,000 190,000 171,868 31,575 31,575 31,575 31,575 31,575 38,000 31,575 31,575 28,000 28,000 265,000 76,000 12,000 40,000 12,000 75,000 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 77,706.20 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ - $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ FYTD incl. Encumbered 77,706.20 73 TRANSPORTATION TOTAL 74 COMMUNICATION EQUIPMENT $ 3,698,516 $ 247,777.20 $ - $ 247,777.20 Replace leaking Electric RTU Cabinet Structures Schweitzer communications controllers Switches / Security / Encryption Fiber Optical Carrier Ethernet Network Equipment Power Monitoring Equipment $ $ $ $ $ 15,000 18,500 40,000 355,000 62,000 $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - 0.0% 0.0% 0.0% 0.0% 0.0% 74 COMMUNICATION EQUIPMENT TOTAL 75 COMPUTER EQUIPMENT $ 490,500 $ - $ - $ - 0.0% GIS software Microsoft - Add server and user licensing as needed Wireless Routers for Water Plants Network Monitoring TAPs for network visibility Juniper Core Switch replacements High Density Switches w/POE for network (phase 2) Purchase New Servers to expand Virtual Environment Purchase additional Disk Storage for Oracle ODA Purchase High Speed Storage / Backup Appliance RAM for IBM Virtual server Expand IBM Storage Purchase Large TVs for video/conferencing Security Software System (4th) Upgrade Lobby Registration Kiosk SAP Licenses for Growth and compliance Oracle Database License for SAP (Growth) Next Generation MyAccount Web Portal Implementation Security Software System (4th) $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 100,000 50,000 30,000 10,000 120,000 60,000 25,000 35,000 50,000 13,500 65,000 25,000 68,000 28,682 171,000 33,000 125,000 68,000 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 61,808.96 12,942.72 58,860.58 78,620.58 - $ 1,077,182 $ 212,232.84 75 COMPUTER EQUIPMENT TOTAL FY20 Budget Encumbered October $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ (106,639.39) - $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ (106,639.39) $ (44,830.43) 12,942.72 58,860.58 78,620.58 - 105,593.45 % FY20 Budget 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 103.6% 6.7% 0.0% 0.0% 0.0% 0.0% -37.4% 0.0% 0.0% 0.0% 0.0% 95.9% 90.6% 0.0% 115.6% 0.0% 0.0% 0.0% 0.0% 0.0% 9.8% ________________________________________________________________________________ Master Page # 76 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Capital Progress Report Fiscal Year 2020 Project Name/Description FY20 Budget Encumbered October FYTD incl. Encumbered % FY20 Budget 76 METERING EQUIPMENT AMI meters budgeted by Electric Meter Shop Legacy meters, instrument trasformers & misc met equip 76 METERING EQUIPMENT TOTAL $ $ $ 1,100,000 $ 380,000 $ 1,480,000 $ 231,237.00 $ 13,500.00 $ 244,737.00 $ 20,194.65 $ $ 20,194.65 $ 251,431.65 13,500.00 22.9% 3.6% 264,931.65 17.9% 77 TRANSFORMERS Distribution Transformers $ 77 TRANSFORMERS TOTAL UNBUDGETED & CARRYOVER ITEMS $ Madison Town Center (Complete Substation) (FY19 Budget) Raw Water Transformer - 1964 Transformer (FY18 Budget) Redstone - Complete 161/25kV Substation (FY18 Budget) Relocate Madison Substation (FY19 Budget) Big Cove Area Substation & Transformer (FY18 Budget) Survey Grade GPS Receiver Transportation Carryovers SCADA Hub Router replacements $ $ $ $ $ $ $ $ $ UNBUDGETED & CARRYOVER ITEMS TOTAL 2,300,000 $ 983,494.20 42.8% $ 663,476.60 $ 320,017.60 $ 983,494.20 42.8% - $ $ $ $ $ $ $ $ 103,287.00 401,124.08 49,233.37 247,645.44 17,185.60 1,931,977.55 3,411.32 $ $ $ $ $ $ $ $ 18,833.20 11,400.00 116,057.92 40,301.50 18,835.00 - $ $ $ $ $ $ $ $ 122,120.20 11,400.00 517,182.00 89,534.87 247,645.44 17,185.60 1,950,812.55 3,411.32 N/A N/A N/A N/A N/A N/A N/A N/A - $ 2,753,864.36 $ 205,427.62 $ 2,959,291.98 N/A $ $ 2,770,245 2,300,000 $ 46,829,027 663,476.60 $ 4,939,587 320,017.60 $ $ 7,709,831 16.5% ________________________________________________________________________________ Master Page # 77 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Multi-Year Progress Report Fiscal Year 2020 Total Project Budget Project Name/Description Proj to Date incl Encumb Encumbered % Total Budget 51 NEW CONSTRUCTION MATERIALS Internally Scheduled AMI Modules - Purchase and Install by Contractor Moontown (46kV Line from Moontown to Chase) Capshaw - Complete Substation & Transmission Tap Underground 46kV to VBC (duct bank) Fiber Network Build 9,738,413.34 348,118.80 94,691,463.27 58.6% 0.0% 16.1% 0.0% 91.5% 51 NEW CONSTRUCTION MATERIALS TOTAL 52 RENEW AND REPLACE MATERIALS Internally Scheduled $ 125,482,126 $ 30,772.00 $ 104,777,995.41 83.5% Chrysler - Replace 1956 Transformer Replace 10 Obsolete Breakers Downtown Electric Switch Replacement Externally Scheduled Martin Road (Wall Triana to Old Jim Williams) Memorial Parkway Relocates (Mastin Lake) Northern Bypass Relocates $ $ $ 325,000 300,000 400,000 $ $ $ - $ $ $ - 0.0% 0.0% 0.0% $ $ $ 450,000 1,200,000 1,800,000 $ $ $ - $ $ $ 238.50 - 0.1% 0.0% 0.0% 52 RENEW AND REPLACE MATERIALS TOTAL UNBUDGETED & CARRYOVER ITEMS $ 4,475,000 $ - $ 238.50 0.0% $ $ $ $ $ 910,406.08 120,571.17 1,813,892.68 1,928,433.04 2,147,687.22 82.8% 92.0% 120.9% 87.3% 93.0% 7,250,559 $ 801,289.89 $ 6,920,990.19 95.5% 111,699,224 81.4% Madison Town Center (Complete Substation) (FY19 Budget) Raw Water Transformer - 1964 Transformer (FY18 Budget) Redstone - Complete 161/25kV Substation (FY18 Budget) Relocate Madison Substation (FY19 Budget) Big Cove Area Substation & Transformer (FY18 Budget) UNBUDGETED & CARRYOVER ITEMS TOTAL $ $ $ $ $ $ $ $ $ $ $ 16,628,420 1,750,000 2,165,000 1,500,000 103,438,706 1,100,000 131,000 1,500,000 2,209,559 2,310,000 $ $ $ $ $ $ $ $ $ $ $ 137,207,685 $ 30,772.00 - 103,287.00 401,124.08 49,233.37 247,645.44 $ $ $ $ $ 832,062 $ ________________________________________________________________________________ Master Page # 78 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Financial Report October 2019 ________________________________________________________________________________ Master Page # 79 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Sales Revenues Budget to Actual Electric Sales Revenues Budget to Actual FY2020 $60,000,000 $50,000,000 $40,000,000 $30,000,000 Budget FY20 Actual FY20 $20,000,000 $10,000,000 $October November December January February March April May June July August September ________________________________________________________________________________ Master Page # 80 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Purchased Power Budget to Actual $45,000,000 Electric Purchased Power Budget to Actual FY 2020 $40,000,000 $35,000,000 $30,000,000 $25,000,000 Budget FY20 $20,000,000 Actual FY20 $15,000,000 $10,000,000 $5,000,000 $October November December January February March April May June July August September ________________________________________________________________________________ Master Page # 81 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Margin Budget to Actual Electric Margin Budget to Actual FY2020 $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 Budget FY20 Actual FY20 $6,000,000 $4,000,000 $2,000,000 $October November December January February March April May June July August September ________________________________________________________________________________ Master Page # 82 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Revenues YTD October 2019 Sales Revenues Residential Sales Budget Other Operating Revenue Actual Budget Actual $20,142,569 $20,317,945 Forfeited Discounts $211,279 $243,820 $3,593,553 $3,642,898 Aid-To-Construction $583,333 $531,208 $12,373,396 $12,492,146 Connection/Tap Fees $186,711 $199,634 Large Commercial Sales $2,901,184 $2,321,364 Collection/Reconnect Fees $146,407 $178,228 Small Industrial Sales $1,364,012 $1,449,323 Miscellaneous $154,436 $86,673 Large Industrial Sales $1,641,291 $1,537,415 Total $1,282,167 $1,239,563 $408,826 $414,175 $0 $0 $42,424,831 $42,175,266 Small Commercial Sales Medium Commercial Sales Lighting Sales Other Sales Total Non Operating Revenue Interest Income Warrant Proceeds Budget Actual Rental Income Warrant Proceeds $624,620 $2,876,000 Reimbursements Total $624,620 $2,876,000 Total Total Revenues Budget Actual $75,000 $32,911 $1,259,169 $1,178,055 $93,067 $94,761 $1,427,236 $1,305,727 Budget $45,758,853 Actual $47,596,556 ________________________________________________________________________________ Master Page # 83 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Actual Sales Revenue Breakdown/Budget To Actual Actual Sales Revenue Breakdown Estimated vs. Actual $45,000,000 3% $40,000,000 6% 2% $35,000,000 $30,000,000 $25,000,000 $20,000,000 89% $15,000,000 $10,000,000 $5,000,000 Sales Revenues Other Operating Rev. Non Operating Rev. Warrant Proceeds $0 Sales Revenues Budget Other Operating Rev. Non Operating Rev. Warrant Proceeds Actual ________________________________________________________________________________ Master Page # 84 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Expenses YTD October 2019 Employee Expenses Payroll-Straight Time Payroll-Overtime Health Insurance FICA Taxes - Employers Unemployment Workers Comp Employer Pension Expense Other Employee Benefits Total Budget $2,409,081 $250,400 $616,407 $203,443 $409 $14,181 $317,114 $206,447 $4,017,482 Actual $2,182,610 $286,547 $563,037 $194,097 $230 $2,206 $348,968 $162,040 $3,739,734 Services Outside Services Legal Services Public Information Total Travel and Training Education & Training Trade/Memberships Dues Employee Meals Business Travel Supplies and Materials Small Tools & Equipment Postage Materials: Non-Stock Office Supplies & Expenses Fuel Purchased Propane Board Expenses Total Budget $138,914 $73,014 $200,999 $80,174 $57,623 $80 $732 $551,535 Actual $141,566 $56,879 $218,159 $20,021 $44,799 $0 $0 $481,423 Total Equipment Maintenance Equipment Maintenance Software Hardware Main. Total Budget Actual $1,139,026 $11,396 $221,842 $1,372,264 Budget $264,005 ($301) $13,758 $277,462 Actual $113,432 $79,362 $14,348 $31,759 $238,902 Budget $44,962 $21,294 $6,038 $7,394 $79,687 Actual $4,639 $85,121 $89,759 ________________________________________________________________________________ Master Page # 85 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 $3,123 $151,237 $154,359 Electric Expenses YTD October 2019 Utilities Budget Actual Other Expenses Budget Actual Utilities $66,588 $43,940 Rentals $53,643 $45,175 Total $66,588 $43,940 Uncollectible Accounts $20,999 $22,271 $4,138 $72 $126 $67 $35,020 $72,916 $23,962 $36,114 $186,788 $127,715 Injuries & Damages Commodity Purchased Power Total Budget $31,498,115 $31,498,115 Actual Cash Overages & Shortage $31,346,468 $31,346,468 Insurance Interest Expense-Customer Deposits Total Tax Equivalents Budget Actual Tax Equivalents $963,316 $913,169 Total $963,316 $913,169 Debt Service Budget Actual Debt Service Expenses $316,258 $231,274 Total $316,258 $231,274 Total Expenses Excluding Capital Total Expenses Excluding Capital & Purchased Power Budget Actual $39,301,006 $37,395,232 Budget Actual $7,802,891 $6,048,764 ________________________________________________________________________________ Master Page # 86 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Expenses YTD October 2019 Capital Mat. - Operation & Main. Mat. - New Construction Mat. - Renew & Replace Land Office Furniture/Equipment Tools & Work Equipment Transportation Equipment Communication Equipment Computer Equipment Metering Equipment Transformers Warrant Principal Total $ $ $ $ $ $ $ $ $ $ $ $ $ Total Expenses/Capital $ Budget 295,833 2,321,776 432,679 16,667 9,500 62,020 1,838,491 38,386 284,955 123,333 191,667 233,333 5,848,639 $ $ $ $ $ $ $ $ $ $ $ $ $ Budget 45,076,729 $ Actual 61,774 2,437,289 18,773 18,835 (106,639) 20,195 320,018 2,770,245 Actual 40,165,477 ________________________________________________________________________________ Master Page # 87 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Actual Cost Breakdown & Budget to Actual Budget vs. Actual Without Purchase of Power Actual Cost Breakdown Without Purchase of Power $6,000,000 $5,000,000 31% 42% $4,000,000 $3,000,000 1% $2,000,000 10% 3% 6% $1,000,000 3% 1% $- 2% 1% Employee Expenses Services Equipment Maintenance Tax Equivalents Other Expenses Supplies and Materials Travel and Training Utilities Debt Service Capital Budget Actual ________________________________________________________________________________ Master Page # 88 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric YTD Variances Revenue Variances • Sales Revenues are equal to budget year to date. Expense Variances • Outside Services is below budget $900,000. Tree Trimming, Meter Reading, MIS, Payment Processing and Engineering were all lower than budget due to slow start on projects or lower expected costs. • Legal Services, Public Information, Education & Training, Business Travel are also below budget due to timing of various activities. ________________________________________________________________________________ Master Page # 89 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash Balances Yearly Cash Balances Without Deposits $45,417,573 $38,792,171 $35,628,394 $35,092,639 $34,347,654 $18,570,125 $15,548,555 $18,961,604 $17,670,224 $6,968,777 FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE FYE 10/31/2019 09/30/2009 09/30/2010 09/30/2011 09/30/2012 09/30/2013 09/30/2014 09/30/2015 09/30/2016 09/30/2017 09/30/2018 09/30/2019 $(9,703,860) $(17,948,463) ________________________________________________________________________________ Master Page # 90 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash Balances Monthly Cash Balances Without Deposits $20,968,328 $19,405,998 $17,891,826 $17,841,938 $16,516,459 $16,479,529 $16,509,252 $13,002,679 $18,961,604 $17,197,396 $17,670,224 $16,142,259 $13,849,379 10/31/2018 11/30/2018 12/31/2018 01/31/2019 02/28/2019 03/31/2019 04/30/2019 05/31/2019 06/30/2019 07/31/2019 08/31/2019 09/30/2019 10/31/2019 ________________________________________________________________________________ Master Page # 91 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 City of Huntsville Electric System Statements of Revenues, Expenses, and Changes in Net Position Current Month October 2019 Current Year Operating Revenue Residential Large commercial and industrial Small commercial Public street and highway lighting Total Operating Income Purchased Commodity KWH Charges Demand Charges Total Purchased Commodity $ Prior Year Year to Date Difference % $ 20,316,813 $ 17,800,248 3,642,898 414,175 42,174,134 $ 19,490,331 $ 826,481 17,264,813 535,435 3,511,208 131,690 402,840 11,336 40,669,192 $ 1,504,943 4.2% 3.1% 3.8% 2.8% 3.7% $ 20,131,934 11,214,534 31,346,468 $ 20,786,345 (654,411) 9,843,241 1,371,293 30,629,586 $ 716,882 Current Year $ Prior Year Difference % $ 20,316,813 $ 17,800,248 3,642,898 414,175 42,174,134 $ 19,490,331 $ 17,264,813 3,511,208 402,840 40,669,192 $ 826,481 535,435 131,690 11,336 1,504,943 4.2% 3.1% 3.8% 2.8% 3.7% -3.1% 13.9% 2.3% $ 20,131,934 11,214,534 31,346,468 $ 20,786,345 9,843,241 30,629,586 $ (654,411) 1,371,293 716,882 -3.1% 13.9% 2.3% Gross Profit Margin $ 10,827,666 $ 25.67% 10,039,605 $ 24.69% 788,061 7.8% $ 10,827,666 $ 25.67% 10,039,605 $ 24.69% 788,061 7.8% Other Operating Income $ 1,849,610 $ 1,565,318 $ 284,292 18.2% $ 1,849,610 $ 1,565,318 $ 284,292 18.2% Operating Expenses Transmission Distribution Customer accounting Administrative and general Payroll Taxes Depreciation Total Operating Expenses $ 53,267 1,493,914 560,971 1,819,708 164,345 2,021,588 6,113,793 $ 22,891 1,226,893 556,317 1,597,321 162,109 1,847,802 5,413,332 $ 30,376 267,021 4,655 222,387 2,236 173,786 700,461 132.7% 21.8% 0.8% 13.9% 1.4% 9.4% 12.9% $ 53,267 1,493,914 560,971 1,819,708 164,345 2,021,588 6,113,793 $ 22,891 1,226,893 556,317 1,597,321 162,109 1,847,802 5,413,332 $ 30,376 267,021 4,655 222,387 2,236 173,786 700,461 132.7% 21.8% 0.8% 13.9% 1.4% 9.4% 12.9% Operating Income $ 6,563,484 $ 6,191,592 $ 371,892 6.0% $ 6,563,484 $ 6,191,592 $ 371,892 6.0% $ $ (28,772) 387,705 2,242 (67,068) 294,107 $ 0.0% 14.4% -6.0% 0.0% 48.0% -20.9% $ $ (1,750) $ (32,911) 364,411 2,242 (99,266) 232,727 $ $ (1,750) $ (32,911) 364,411 2,242 (99,266) 232,727 $ $ (28,772) 387,705 2,242 (67,068) 294,107 $ $ 6,330,757 $ 5,897,485 433,273 7.3% $ 6,330,757 $ 5,897,485 433,273 7.3% $ 913,169 5,417,588 $ 921,814 4,975,671 $ (8,645) 441,917 -0.9% 8.9% $ 913,169 5,417,588 $ 921,814 4,975,671 $ (8,645) 441,917 -0.9% 8.9% Non-Operating (Revenues) Expenses Gain or Loss on Sale of Assets Interest income Interest expense Amortization of bond discount Amortization of bond premium Total Other Revenue (Expenses) Income Before Taxes Transfers Out - Tax Equivalent Increase (Decrease) in Net Position (1,750) (4,139) (23,294) (32,197) (61,380) ________________________________________________________________________________ Master Page # 92 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 (1,750) (4,139) (23,294) (32,197) (61,380) 0.0% 14.4% -6.0% 0.0% 48.0% -20.9% City of Huntsville Electric System Statements of Net Position October 2019 Assets and Deferred Outflows of Resources Current Assets Cash and Cash Equivalents Investments Board Designated Funds Cash and Cash Equivalents Investments Restricted Funds Customer Deposits Cash and Cash Equivalents Investments Accounts Receivable - Trade, Net of Allowance Inventories - Materials and Supplies Prepaid Expenses Accrued Interest, Rent and Other Receivables Total Current Assets Current Year $ $ Prior Year 441,345 $ 1,359,676 15,869,097 15,509,918 6,357,986 47,029,200 12,690,346 224,453 3,698,769 87,670,872 $ 6,997,614 46,362,518 11,462,248 65,179 3,970,209 89,826,096 25,026,875 15,013,634 37,951,908 500,000 25,881,666 64,333,574 444,872 Non-Current Assets Restricted Assets Customer Deposits Cash and Cash Equivalents Investments Warrant Funds Cash and Cash Equivalents Investments Cash, Cash Equivalents, and Investments $ 502,913 2,149,693 42,693,115 $ Other Assets Regulatory Asset - Revenue Warrant Expense $ 417,965 $ Utility Plant Plant in service Construction in progress Total Utility Plant Less: Accumulated depreciation Total Utility Plant Total Non-Current Assets Total Assets Deferred Outflows of Resources Deferred Amount on Debt Refunding Deferred Amount on Pension Employer Contributions Deferred Outflow OPEB Total Deferred Outflows of Resources Total Assets and Deferred Outflows of Resources $ $ $ $ 894,753 4,563,657 636,064,199 63,899,441 699,963,640 (336,764,009) 363,199,631 406,310,711 $ $ $ $ 583,599,791 62,309,636 645,909,427 (316,064,690) 329,844,736 394,623,182 $ 493,981,583 $ 484,449,277 $ $ 849,927 $ 5,638,292 140,867 6,629,086 $ 977,714 4,816,942 5,794,656 $ 500,610,670 $ 490,243,933 ________________________________________________________________________________ Master Page # 93 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 City of Huntsville Electric System Statements of Net Position October 2019 Liabilities and Deferred Inflows of Resources Current Liabilities Accounts Payable - Trade Accounts Payable - Other Utility Departments Compensated Absences Accrued Payroll Other Current Liabilities Total Current Liabilities payable from current assets $ 35,378,723 $ 2,365,718 3,254,445 990,869 3,056,122 45,045,877 $ 35,200,219 2,271,957 3,221,630 1,056,003 3,683,491 45,433,300 $ 6,357,986 2,800,000 1,610,458 10,768,444 $ 6,997,614 1,865,000 1,649,313 10,511,927 Non-Current Liabilities Net Pension Liability, Less Current Portion Net OPEB Liability, Less Current Portion Customer Deposits, Less Current Portion Revenue Warrants, Less Current Portion Unamortized Bond Premium Total Non-Current Liabilities $ 32,956,086 25,498,485 40,040,509 74,775,000 12,031,267 185,301,346 $ 31,570,249 28,890,677 37,951,908 77,575,000 13,301,077 189,288,910 Total Liabilities $ 241,115,667 $ 245,234,136 $ 1,267,221 $ 2,530,774 3,797,995 $ 1,108,556 1,108,556 Liabilities Payable From Restricted Assets Customer Deposits, Current Portion Revenue Warrants, Current Portion Interest Payable Total Liabilities Payable from Restricted Assets Deferred Inflows of Resources Deferred Pension Plan Earnings Difference Deferred Outflow OPEB Total Deferred Inflows of Resources $ $ Net Position Invested in Capital Assets, Net of Related Debt Restricted Unrestricted Total Net Position 272,400,871 49,051,101 (65,754,964) 255,697,007 236,876,932 71,331,188 (64,306,880) 243,901,241 Total Liabilities, Deferred Inflows and Net Position 500,610,670 490,243,933 ________________________________________________________________________________ Master Page # 94 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 City of Huntsville Electric System Financial Statements Statistical Data Comparisons October 2019 Current Month Year to Date Current Year Prior Year 206,995,196 196,071,542 34,010,210 3,117,708 440,194,656 339,758 440,534,414 199,140,119 202,901,761 32,581,000 3,073,108 437,695,988 305,318 438,001,306 3.9% -3.4% 4.4% 1.5% 0.6% 11.3% 0.6% 206,995,196 196,071,542 34,010,210 3,117,708 440,194,656 339,758 440,534,414 199,140,119 202,901,761 32,581,000 3,073,108 437,695,988 305,318 438,001,306 3.9% -3.4% 4.4% 1.5% 0.6% 11.3% 0.6% 1,086,418 408,775 954,997 403,537 13.8% 1.3% 1,086,418 408,775 954,997 403,537 13.8% 1.3% Kilowatt Hours Purchased 396,319,472 403,278,907 -1.7% 396,319,472 403,278,907 -1.7% Revenue for General Power >50kw, kw $ 5,099,049 $ Line losses & unaccounted for Percent of losses to purchases Revenue per kWh (cents) Cost per kWh purchased (cents) Margin on Sales Load Factor (44,214,942) (34,722,399) -11.16% -8.61% $ 0.0957 $ 0.0929 $ 0.0508 $ 0.0515 25.67% 24.69% 49.97% 57.85% (44,214,942) (34,722,399) -11.16% -8.61% $ 0.0957 $ 0.0929 $ 0.0508 $ 0.0515 25.67% 24.69% kWh Sold & Used Residential Large Commercial and Industrial Small Commercial Street and Athletic Lighting Total Kilowatt hrs for own use Total kWh sold & used Kilowatt Hours Purchased Purchased from TVA System KW Demand End Use KW Demand Customer Data Residential Large Commercial and Industrial Small Commercial Street Lighting Total Current Year 3.1% -1.4% Prior Year 5,099,049 168,616 2,896 19,060 665 191,237 3.1% -1.4% 165,411 2,942 18,615 654 187,622 ________________________________________________________________________________ Master Page # 95 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 BOARD RECAP Electric System Fiscal Year to Date October 2019 FYTD 2019 ACTUALS FYTD 2020 ACTUALS (19,491,945) (3,511,208) (11,700,224) (2,324,362) (1,716,860) (1,523,367) (402,840) (261,048) (407,746) (196,401) (28,772) (891,788) (146,043) (267,395) (6,295,326) (88,556) (20,317,945) (3,642,898) (12,492,146) (2,321,364) (1,449,323) (1,537,415) (414,175) (243,820) (531,208) (199,634) (32,911) (1,178,055) (178,228) (94,761) (2,876,000) (86,673) (20,142,569) (3,593,553) (12,373,396) (2,901,184) (1,364,012) (1,641,291) (408,826) (211,279) (583,333) (186,711) (75,000) (1,259,169) (146,407) (93,067) (624,620) (154,436) (175,376) (49,345) (118,749) 579,820 (85,311) 103,876 (5,349) (32,540) 52,125 (12,923) 42,089 81,114 (31,821) (1,695) (2,251,381) 67,763 0.87% 1.37% 0.96% -19.99% 6.25% -6.33% 1.31% 15.40% -8.94% 6.92% -56.12% -6.44% 21.73% 1.82% 360.44% 0.00% -43.88% Total Revenues (Credit) (49,253,881) (47,596,556) (45,758,853) (1,837,703) 4.02% Sales Revenues (Credit) (40,670,805) (42,175,266) (42,424,831) 249,565 -0.59% 30,629,586 31,346,468 31,498,115 (151,647) -0.48% (10,041,219) 24.69% (10,828,798) 25.68% (10,926,716) 25.76% 97,918 -0.90% 2,119,805 306,481 110,042 58,779 38,321 536 228,827 17,260 38,806 36,659 512,907 32,959 8,619 33,703 37,362 13,900 38,796 1,799 (74) 185,717 2,182,610 286,547 141,566 56,879 44,962 3,123 264,005 (301) 43,940 45,175 218,159 20,021 13,758 22,271 21,294 6,038 126 44,799 7,394 67 190,316 2,409,081 250,400 138,914 73,014 113,432 4,639 1,139,026 11,396 80 66,588 53,643 200,999 80,174 221,842 20,999 79,362 14,348 4,138 57,623 31,759 72 732 - (226,471) 36,147 2,651 (16,134) (68,470) (1,516) (875,021) (11,697) (80) (22,647) (8,469) 17,160 (60,153) (208,084) 1,272 (58,069) (8,311) (4,012) (12,824) (24,365) (5) (732) 190,316 * * * * * * * * * * * * * * * * * Residential Sales (80) Small Commercial Sales (81) Medium Commercial Sales (82) Sales Large Commercial (83) Sales Small Industrial (84) Sales Large Industrial (85) Hydrant/Lighting Sales (86) Forfeited Discounts (87) Aid-To-Construction (88) Connection/Tap/Fees (89) Interest Income (90) Rental Income (91) Collection/Reconnect Fees (92) Reimbursements (94) Warrant Proceeds (95) Other Sales (96) Miscellaneous Revenue (99) * Purchased Commodity (10) Gross Margin Gross Margin % * * * * * * * * * * * * * * * * * * * * * * * * Payroll - Straight Time (01) Payroll - Overtime (02) Small Tool&Equipment (03) Postage (04) Education & Training (05) Equipment Maintenance (06) Outside Services (07) Legal Fees (08) Purchased Propane (11) Other Utilities (12) Rentals (13) Materials: Non-Stock (14) Office Supply & Expense (15) Public Information (16) Uncollectible Accounts (17) Trade/Membership Dues (18) Employee Meals (19) Injuries & Damages (20) Fuel (22) Total Quality Management (23) Business Travel (24) Cash Overages & Shortages (29) Board Expenses (30) Health Insurance (31) - OPEB FYTD 2020 PLAN VARIANCE % -9.40% 14.44% 1.91% -22.10% -60.36% -32.68% -76.82% -102.64% -100.00% -34.01% -15.79% 8.54% -75.03% -93.80% 6.06% -73.17% -57.92% -96.95% -22.26% 0.00% -76.72% -6.88% -100.00% 0.00% Page 1 of 2 ________________________________________________________________________________ Master Page # 96 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 BOARD RECAP Electric System Fiscal Year to Date * * * * * * * * * * * * Health Insurance (31) - retiree Health Insurance (31) - active FICA Taxes - Employers (32) Unemployment Compensation (33) Workers Compensation Ins (34) Employers Pension Expense (35) Other Employee Benefits (36) Tax Equivalent (37) Debt Service Expense (38) Insurance (39) Customer Deposit Interest (40) Software/Hardware Maintenance (100) October 2019 FYTD 2019 ACTUALS FYTD 2020 ACTUALS FYTD 2020 PLAN VARIANCE % 365,801 190,156 1,465 7,148 335,035 191,740 921,814 267,687 18,065 55,192 83,278 372,721 194,097 230 2,206 348,968 162,040 913,169 231,274 23,962 36,114 151,237 616,407 203,443 409 14,181 317,114 206,447 963,316 316,258 35,020 72,916 85,121 (243,685) (9,345) (179) (11,975) 31,853 (44,407) (50,147) (84,984) (11,058) (36,802) 66,116 0.00% -39.53% -4.59% -43.83% -84.44% 10.04% -21.51% -5.21% -26.87% -31.58% -50.47% 77.67% Total Expenses (Debit) less Purchased Commodity 6,258,586 6,048,764 7,802,891 (1,754,127) -22.48% Total Expenses (Debit) with Purchased Commodity 36,888,172 37,395,232 39,301,006 (1,905,774) -4.85% Materials - Operation & Maintenance (50) Materials - New Construction (51) Materials - Renew & Replacement (52) Warrant Principal (63) Land (70) Office Furniture & Equipment (71) Tools & Work Equipment (72) Transportation Equipment (73) Communication Equipment (74) Computer Equipment (75) Metering Equipment (76) Transformers (77) 108,018 2,950,626 455,204 35,876 2,125 63,190 134,994 61,774 2,437,289 18,773 18,835 (106,639) 20,195 320,018 295,833 2,321,776 432,679 233,333 16,667 9,500 62,020 1,838,491 38,386 284,955 123,333 191,667 (234,059) 115,514 (413,906) (233,333) (16,667) (9,500) (62,020) (1,819,656) (38,386) (391,594) (103,139) 128,351 -79.12% 4.98% -95.66% -100.00% -100.00% -100.00% -100.00% -98.98% -100.00% -137.42% -83.63% 66.97% Total Capital Expenditures (Debit) 3,750,033 2,770,245 5,848,639 (3,078,395) -52.63% Modified Cash Flow - (gain)/loss (8,615,676) (7,431,080) Total Expenditures (Debit) less Purchased Commodity 10,008,618 8,819,009 (609,208) 13,651,530 (6,821,872) 1119.79% (4,832,522) -35.40% Page 2 of 2 ________________________________________________________________________________ Master Page # 97 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments Company Wide Cash & Investments Cash and Investments By Company HU Cash and Investments HU Cash and Investment by Company 17,303,217 19,200,038 20% Unrestricted Funds 42% Restricted Bonds Funds 143,863,418 Restricted OPEB Funds Electric Water Gas 38% ________________________________________________________________________________ Master Page # 98 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments Electric Cash and Investments 2,652,606 9,118,795 Unrestricted Funds Restricted Bonds Funds Restricted OPEB Funds 64,068,718 ________________________________________________________________________________ Master Page # 99 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments Electric Unrestricted Funds 2,036,403 1,680,499 3,419,825 Operating Fund Construction Fund 10,092,151 Insurance Fund Workers Comp Fund 46,839,840 Emergency Fund ________________________________________________________________________________ Master Page # 100 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments 2,098,472 2,342,865 Electric By Bank Account 1,818,270 1,012,982 PNC Operating Account BB&T Money Market 9,118,795 BB&T Investment Account 24,462,509 Bank of New York Trust Acct Regions Money Market 5,368,983 Iberia Money Marker 5,366,617 Synovus 1,232,422 Regions OPEB Investment Bryant Bank Money Market 2,507,534 Servis 1st 2,652,606 Candence 34,614,655 Compass Bank ________________________________________________________________________________ Master Page # 101 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments Electric Investments 5,365,271 Cash US Treasury Obligation 29,249,383 ________________________________________________________________________________ Master Page # 102 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Review of Cash & Investments Without Considering Deposits Considering Deposits Electric Unrestricted & Deposits Electric Unrestricted Funds 2,036,403 3,419,825 2,036,403 3,419,825 441,345 1,680,499 1,680,499 Operating Fund Operating Fund Construction Fund 10,092,151 Insurance Fund Customer Deposits 10,092,151 Construction Insurance Workers Comp Fund 46,839,840 Workers Comp Emergency Fund Emergency 46,398,495 ________________________________________________________________________________ Master Page # 103 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM TO: Electric Board FROM: Mike Counts PE, Vice President of Operations DATE: November 11, 2019 SUBJECT: Electric Operational Monthly Report – October 2019 Electric Operations Transmission crews completed the Blue Origin project. Crews worked on moving a section of overhead distribution line on Fords Chapel at Sparkman High School for a new crosswalk. We continue to assist the fiber project in the Triana hut area. Contract crews continued to assist us with performing line construction/maintenance/work order type work while our crews assist with fiber installation. These contract crews performed well. The last day working on our system was October 24th. Underground crews completed the manhole project on Huntsville Primary 264. Substation crews completed maintenance items at Northwest and Huntsville Primary Substations while these two substations were switched for TVA to make upgrades. The transformer for the Redstone Substation was moved and set in place. Crews made repairs at the following substations: West Huntsville, Garth, Andrew Jackson and Walnut. The make ready contractor for fiber installation has completed their work in the Jetport hut area. The last day working on our system was October 24th. Meter Shop personnel worked with the AMI team and the MIV to resolve issues & repair considerations. Assisted one customer with a generator interconnect issues. Two new solar installations were commissioned in October. System Operations performed voltage reduction three times last month to support our load reduction effort. There was no request from TVA to do voltage reduction in October. The peak was 1,086,418 kW on October 2nd at 5:00 P.M., and the temperature was 98 degrees. We estimated that the peak was reduced by approximately 36 MW and that equates to a savings of $367,666.19 on our power bill to TVA. We had 3,122 trouble calls, 96 breaker operations, and 14 breaker lockouts this month. Six were caused by equipment failures, 2 were caused by vehicle damage, 4 were caused by storms, 1 was caused by a tree, and 1 was for public safety. The tree trimming and R.O.W. 1115 trimmed trees, removed 59 trees, made 16 SWDA dumps and 8 loads were given to property owners. The Street Light section completed 0 work orders, installed 3 new street lights, worked 425 requests for repairs, repaired 124 fixtures, replaced 612 photocells and 612 bulbs, repaired 14 bad cables, and there were 175 repairs made this month to interstate lights. ________________________________________________________________________________ Master Page # 104 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Fiber Operations HU Fiber crews continued testing, installed bulkheads, replaced MSTs, and repaired splicing as necessary. Testing was performed in Jetport C-Route and Triana E-Route and F-Route. This included retesting after repair of identified deficiencies. Crews worked a total of 9 trouble tickets this month, 5 of which required overtime. Fiber Project: HU received a letter of acknowledgement this month for fulfilling the contractual obligation of 95,000 households passed. This was made possible by a tremendous push over the last 2 months by HU personnel from all across the organization pulling together to plan, organize, and perform part of the work in-house and to help direct contractors and consultants toward the areas of primary focus that would accomplish our goal. Thanks to their outstanding efforts, our organization was able to accomplish something that often seemed unattainable. The Fiber Department continues to support the fiber build with the coordination of all splicing and testing, inspector supervision, as-built management and route design. TGBNS continues monitoring and inspecting plant as it is being built by Bear. We provide corrective action reports for deficiencies found in the field and repairs must be completed before invoicing is approved. Unfortunately, Bear’s production has dropped significantly over the past few weeks since they learned that HU had met our contractual obligation. They have cut their crews in market by more than half and their production is down to nearly a quarter of where it was a month ago. They still have nine routes remaining to complete and turn over, a large amount of deficiencies in constructed plant to repair, and a lot of clean up and restoration to perform. Fiber Engineering personnel remained in the field with Fiber Operations and Bear crews for a large portion of this month assisting with testing, responding to customer complaints, and coordinating clean-up and repairs for customers’ properties. Mike Counts Mike Counts, PE Vice President, Operations ________________________________________________________________________________ Master Page # 105 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 ELECTRIC OPERATIONS STATISTICS OCTOBER 2019 NEW CONSTRUCTION OCTOBER SEPTEMBER 0 4,998 80 11,081 19,749 0 4,000 272 13,347 12,020 Breaker Operations 96 171 TEMPERATURE DEVIATION FROM NORM (°) COOLING DEGREE DAYS HEATING DEGREE DAYS 1.9 57 -9 6.9 199 -13 PRECIPITATION DEVIATION FROM NORM (") 2.15 -3.45 Transmission Three-Phase Overhead 12kV Single-Phase Overhead 12kV Three-Phase Underground 12kV Single-Phase Underground 12kV ENGINEERING ________________________________________________________________________________ Master Page # 106 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 OCTOBER SYSTEM LOAD PEAK 10/2 (1,086,418 kW) @5:00 P.M. @ 98° 1200000 0.8 0.7 1000000 0.6 800000 0.5 600000 0.4 0.3 400000 0.2 200000 0.1 0 0 Daily Peak Average Load Load Factor ________________________________________________________________________________ Master Page # 107 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 HUNTSVILLE UTILITIES SYSTEM PEAKS WITH 12 MONTH ROLLING AVERAGE 1400 1200 1000 MW 800 600 400 200 0 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Monthly Peaks Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 12 Month Rolling Average ________________________________________________________________________________ Master Page # 108 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 HUNTSVILLE UTILITIES FOUR YEAR MONTHLY AVERAGE PEAK MW 912 Oct Nov Dec Jan Feb Mar Apr May June July Aug Sep ________________________________________________________________________________ Master Page # 109 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 HUNTSVILLE UTILITIES SYSTEM PEAKS 1100 1086 1050 MW 1000 950 900 850 800 Oct Nov Dec Jan Feb FY19 Mar Apr May June July Aug 4 Year Monthly Average Peak ________________________________________________________________________________ Master Page # 110 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Sep Electric Trouble Calls Monthly Averages by Fiscal Year 1400 1200 1172 1073 1068 1000 995 994 891 873 844 800 796 768 738 600 400 200 127 0 Regular Time Overtime 2017 11/12/2019 2018 2019 Weekend/Holiday Overtime 2020 ________________________________________________________________________________ Master Page # 111 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Electric Department Monthly Trouble Calls FISCAL YEAR 2020 Number of Calls Received by Time Received % of Calls Received by Time Received Month/Year Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Monthly Avg. RT Total 1073 OT M-F 738 OT Wkend 1524 OT Hol 0 OT Total 2262 Total 3335 % OT Calls 68% 1073 738 1524 0 2262 3335 68% Month/Year Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Monthly Avg. Number of Calls Received by Time Received RT OT OT OT OT Total M-F Wkend Hol Total 660 760 253 0 1013 680 633 589 105 1327 833 747 1084 56 1887 549 766 505 24 1295 739 1432 521 57 2010 815 616 1210 0 1826 689 643 433 67 1143 805 832 495 31 1358 928 2044 1117 0 3161 94 748 1367 30 2145 840 1737 867 0 2604 1581 3111 683 59 3853 768 1172 760 36 1969 % M-F % WkEnd Calls Calls 22% 46% 22% Tap Ups % Hol Calls 0% 46% OT 68 Total 94 0% FISCAL YEAR 2019 Total 1673 2007 2720 1844 2749 2641 1832 2163 4089 2239 3444 5434 2736 % of Calls Received by Time Received % OT % M-F % WkEnd % Hol Calls Calls Calls Calls 61% 45% 15% 0% 66% 32% 29% 5% 69% 27% 40% 2% 70% 42% 27% 1% 73% 52% 19% 2% 69% 23% 46% 0% 62% 35% 24% 4% 63% 38% 23% 1% 77% 50% 27% 0% 96% 33% 61% 1% 76% 50% 25% 0% 71% 57% 13% 1% 72% 43% 28% 1% Tap Ups OT 68 69 63 83 99 76 95 103 88 98 99 90 Total 94 90 78 57 70 98 73 123 59 132 129 124 FISCAL YEAR 2018 Number of Calls Received by Time Received Month/Year Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Monthly Avg. RT Total 626 816 599 979 1317 416 2423 887 2052 949 969 788 1068 OT M-F 636 746 523 580 424 769 2314 780 1551 618 1686 1302 994 OT Wkend 958 1033 538 629 295 652 1873 894 344 421 351 977 747 OT Hol 0 130 5 890 0 26 0 51 0 47 0 12 97 OT Total 1594 1909 1066 2099 719 1447 4187 1725 1895 1086 2037 2291 1838 % of Calls Received by Time Received Total 2220 2725 1665 3078 2036 1863 6610 2612 3947 2035 3006 3079 2906 % OT Calls 72% 70% 64% 68% 35% 78% 63% 66% 48% 53% 68% 74% 63% % M-F % WkEnd Calls Calls 29% 43% 27% 38% 31% 32% 19% 20% 21% 14% 41% 35% 35% 28% 30% 34% 39% 9% 30% 21% 56% 12% 42% 32% 34% 26% % Hol Calls 0% 5% 0% 29% 0% 1% 0% 2% 0% 2% 0% 0% 3% Tap Ups OT 45 24 56 48 32 59 85 83 54 114 108 90 Total 85 74 92 75 57 92 166 114 143 88 81 66 FISCAL YEAR 2017 Number of Calls Received by Time Received Month/Year Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Monthly Avg. RT Total 619 1104 627 515 654 802 737 921 2052 1065 758 619 873 OT M-F 396 1568 582 636 438 1219 456 1261 1551 894 1297 396 891 OT Wkend 595 255 533 999 561 276 936 5540 334 712 239 595 965 OT Hol 0 76 19 80 0 0 16 62 62 55 0 0 31 OT Total 991 1899 1134 1715 999 1495 1408 6863 1947 1661 1536 991 1887 % of Calls Received by Time Received Total 1610 3003 1761 2230 1653 2297 2145 7784 3999 2726 2294 1610 2759 % OT Calls 62% 63% 64% 77% 60% 65% 66% 88% 49% 61% 67% 62% 65% % M-F % WkEnd Calls Calls 25% 37% 52% 8% 33% 30% 29% 45% 26% 34% 53% 12% 21% 44% 16% 71% 39% 8% 33% 26% 57% 10% 25% 37% 34% 30% % Hol Calls 0% 3% 1% 4% 0% 0% 1% 1% 2% 2% 0% 0% 1% Tap Ups OT 46 39 45 45 32 40 39 75 54 63 57 46 48.4 Total 81 73 95 102 68 74 69 146 143 100 93 81 94 ________________________________________________________________________________ Master Page # 112 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Engineering Monthly Report October 2019 GENERAL SUMMARY:  A total of $ 945,451.75 in ATC payments was posted this month $516,120.75 for Electric, $359,621.00 for Water, $516,120.75 for Gas)  There are 226 residential projects, 419 commercial projects, and 23 road projects in progress  5,775 locate tickets were completed (251/day).  113 new gas service line requests were received this month PERSONNEL UPDATE: Engineering Services: OT Report Engineering Services:  Engineering Services employees worked 88.5 overtime hours during the two pay periods ending in October (pay periods ending 10/04/2019 and 10/18/2019). Overtime breakdown:  11.5 hours assisting with Locates  77 hours working on Engineering Projects  0 hours of On-Call time Engineering Planning:  Engineering Planning employees worked 3 overtime hours during the two pay periods ending in October (pay periods ending 10/04/2019 and 10/18/2019). Overtime breakdown:  3 hours associated with the Greenbrier area gas and water improvements (inspection).  Engineering Planning has hired a temporary contract employee to work part time assisting with project workload. Mapping & Locates:  Locates employees worked 226 overtime hours during the two pay periods ending in September (pay periods ending 10/04/2019 and 10/18/2019). This is up from 99 hours last month (which was high due to underground fiber construction in Jet Port). Overtime breakdown:  226 hours working on Locate tickets and emergency requests  Average 32.286 overtime hours per Locator (7 Locators)  Average 8.071 overtime hours per locator per week  35 hours of On-Call time Meter Technology  No personnel update this month. CHAMBER OF COMMERCE PROJECTS:  Vintage Drive Building (City of Huntsville, Madison County)  The Chamber requested water information for a potential customer. Huntsville Utilities supplied existing site facility information and capacity information to the Chamber.  Endeavor Way Site (City of Huntsville, Limestone County)  The Chamber requested information for a potential water and gas customer. Huntsville Utilities supplied existing site facility information and capacity information to the Chamber. ________________________________________________________________________________ Master Page # 113 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 PROJECT HIGHLIGHTS:  Huntsville Gas Cast Iron Replacement Project  To date, 32,438’ of 2”PE, 6,951’ of 4”PE, 6,950 of 6”PE, and 442 service lines have been replaced. This amounts to about 32% of the 27.3 miles of cast iron pipe. The project has changed contractors once, and both contractors have had financial difficulties. The remainder of the work will be re-bid in the near future.  Blue Origin (Blue Engines)  HU crews completed the installation of the distribution and transmission lines.  The water meters have been installed by HU crews. Contractor installations pending. Main relocation needed due to proposed storm drainage. Relocation work has not started.  The temporary power design has been sent to Operations and is currently being installed.  Dunlap Contracting was low bid on the substation site work and is currently going through insurance paperwork.  Constellation Project Downtown  HU met with the COH and the developer to discuss utilities; utility designs are currently under review.  The developer is working through electric meter room design requirements with the meter shop. The developer is requesting internal electric meter rooms, currently not allowed by HU.  Crystal Creek Phase 1 @ Mountain Preserve (Enfinger Development near Wilson Cove/Cherry Tree)  Mr. Miller is working with Sam Givhan/Wilmer & Lee, the COH attorney, on the title work for these easements and these will likely be condemned.  HU is working with Jeff Enfinger, his engineer, and the COH to ensure they can assist in a path from the Wilson Cove development to this proposed development for water and gas that will not involve any County rights-of-way, whether prescriptive or not. The COH understands the HU position and is working with the sewer extension required to assist with the necessary easements. HU has supplied the offsite alignment to the COH for easement acquisition.  Enfinger has obtained easements from the property owner for the future phases of Wilson Cove and submitted those to HU for design and the COH for recording.  The offsite water main extension work order and estimate has been completed and discussions are taking place with Enfinger on this piece of the project.  The onsite work order has also been designed and estimated.  The electric design is complete.  Mid-City (Old Madison Square Mall Site, TopGolf site, future Amphitheater site, Dave & Busters)  MidCity Phase 2A water and electric drawings have been submitted to the COH to be included in their bid packages.  The new water tie to establish a loop feed across Research Park Boulevard is currently in design.  HU is working closely with the COH, multiple developers, engineers, and landscape architects on optimal locations for utilities and fixtures in this very densely, continuously changing, downtown like development. HU attended several meetings to discuss different portions of this development and the best way to help meet their needs.  The COH has requested a great deal of assistance from HU in an effort to help this project be successful and HU is doing everything possible to assist.   There are numerous work orders required for the multiple buildings being constructed including: REI, Dave & Busters, The Pavilion, Aloft Hotel, MidCity Apartments, Highpoint, Building 7 Retail, Pies & Pints, COH roadway infrastructure projects, private alleyway infrastructure projects by the developer, parking garages, parks, etc. Limestone County Water Service Area Transition  HU continues monitoring pressures in various areas since the transition with pressure recorders to ensure there are no unknown issues and to calibrate this new area of the water model ________________________________________________________________________________ Master Page # 114 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019  HU has been meeting with GE Aviation and a developer near Endeavor Way to discuss fire flow and pressure needs that they are currently requesting. HU has provided information to these customers and these issues have been resolved at this time.  The water sales agreements are currently being reviewed by LCWSA and HU and will likely be combined into one agreement with a common rate.  The water model is being completed and calibrated and will be used to help determine the best areas for system improvements going forward.  Vuteq Huntsville – MTMUS Offsite Supplier – Greenbrier Road & Greenbrier Parkway – Limestone County  HU met with the general contractor and engineers for this approx. 330,000 sq. ft. proposed building  This will be a new water and gas customer served from Greenbrier Road. We are currently waiting on digital CADD files and loads to prepare the needed ATC estimates and designs.  Water and gas service available at the site currently  Preliminary schedule is water & gas services needed by April 2020 Meter Technology/AMI Summary:  There were 6,906 electric meters deployed in the month of October. They were installed in the areas surrounding, Old Monrovia Rd, Harvest Rd, Ford Chapel, Jeff Rd, Douglass Rd, Mastin Lake, Pulaski Pike, Blue Spring Rd, and Grizzard Rd.  There are presently 64,515 total meters being billed from AMI readings (242 water, 5 gas, 64,268 electric). Approximately 230 non-billing, gas modules remain deployed to further test gas readings. We now have a total of 90 opt-out customers.  Full Gas deployments have been delayed until mid-fiscal year 2020 due to budgetary concerns. Landis and Gyr has notified us of a delay with their water solution. This will delay the water deployment. Fiber Project Update: Update on the Fiber Network Build Progress:  On 10/18/2019 Huntsville Utilities met our contractual obligation to meet 95,000 households passed (HHP) before October 27, 2019.  Huntsville Utilities will continue to build out within the City of Huntsville to reach 105,000 HHP sometime in the spring of 2020;  The most recent monthly invoice to Google was $502,253.47 (up from $471,860 last month); this will continue to increase to approximately $590,000 per month.  Overall at final build Google will be providing 55% ($7,080,000 annually) of the total annual revenue counted toward the fiber project, with the City of Huntsville at 20% (2,496,000 annually offset to PILOT) and contributions from our operating departments at 15% ($1,800,000 annually) from electric, 7% ($840,000 annually) from water, and 3% ($360,000 annually) from gas. Other fiber related activities:  Continue processing ALDOT permits as needed to support the fiber network build.  Negotiating colocation lease and various dark fiber leases SAFETY: No Required Safety meeting for this month. ENGINEERING DEPARTMENT SUMMARY: ELECTRIC CAPITAL BUDGET PROJECTS: Blue Origin  Substation and distribution  Breakers and regulators are in production.  46 kV line is completed.  Site clearing work was awarded. ________________________________________________________________________________ Master Page # 115 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Old 431 New Distribution Substation (Category 51-5)  Substation  New Hope Telephone has marked their cable. We will move it. We’ll work on a new R/W agreement with New Hope Telephone. Construction began July 8.  BESCO has begun construction. Transformers and control building have been set. Steel is going up.  Projected completion date: late summer 2019  Transformer – purchased. Stored at Big Cove Substation.  Distribution lines – FY19 (Category 51-6) – Phase 1 plans are complete. Waiting on conductor design information. Madison New Distribution Substation (Category 51-12)  Substation  Inspection and commissioning remain.  Transformer – on the pad and ready for service.  Distribution lines – FY19. Underground exit circuits – 90% complete.  Transmission line re-design complete. Encasement pipe has been bored across Kyser Blvd. and conduits have been placed in them. Should finish setting poles next week and start working on pulling the UG portion in as well. Redstone Gateway (Category 5182)   Substation  Drilled pier foundations for the 12 kV have been completed. 12 kV breaker foundations done. Ground grid work is underway.  Fence work has not started.  Projected completion date: fall 2019. Distribution lines – FY20 Line 9 Capshaw New Distribution Substation  Substation  Geotechnical report has been received. Site plan is due soon.  Projected completion date: late spring 2020.  Transformer – purchased. Stored at Chase.  Distribution lines Town Madison New Distribution Substation (Category 51-13,14)  Substation  Steel is up. Bus work completed. Trench installed. Control building delivered. Working on ground grid.  Projected completion date: December, 2019.  Transformer – purchased. Stored at Jetport Substation.  Transmission line – Design has been completed and has been submitted for approval.  Distribution lines – (Category 51-15) Wah Chang Substation Transformer (Category 52-15)  Transformer delivered. ________________________________________________________________________________ Master Page # 116 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 ROAD PROJECTS:  Martin Road (Wall Triana to Old Jim Williams) (Category 52-8)  Received set of plans. Under review to start layout and design.  Church St. Phase 1 (Category 52-9)  46 kV circuits are back normal.  Relocations are complete. Waiting on other attachers to relocate. Poles will be removed once the other attachers relocate.  Zierdt Rd (Category 52-10)  Relocations are complete. Waiting on other attachers to relocate. Poles will be removed once the other attachers relocate.  Martin Rd - Zierdt to Old Jim Williams (Category 52-8, carryover)  Having to relocate 1 pole that is too close to the new road.  Mastin Lake & Parkway Relocation (Category 52-13)  Meeting with Electric and Fiber Operations resulted in an alternate solution to some of the issues in getting 46 kV and 12 kV lines moved. Engineering is reviewing this new option. Will be completing design work in next couple of weeks. We have several corners to turn where there is little if any space for standard guy and anchor designs. Working on easements.  Loading drawings into Bentley & SAP has started.  Last update is 3rd calendar quarter for a utilities contract letting, with road contract not until 2022.  Working with property owners to secure easements needed for relocations.  Looking at a new easement possible around the old Gander Mountain Building. Did a rough draft for the owner to review.  Northern Bypass (Category 52-14)  Proposed relocation layouts are completed.  Requesting an updated schedule from ALDOT on their bid opening dates.  Last update on scheduling that it has changed with no definitive schedule yet.  COH is going to 100% fund project, with no ALDOT support. This changes a good many items including schedules, who is paying for outside engineering support, and what will be reimbursed. OTHER ACTIVITIES: Specifications/Materials:  Met with PPI on their overhead transformers.  Met with Howard on their pad-mounted transformers. Distribution:   Winchester Rd. Phase 2- no activity. Westclox Distribution – Currently working on work order to reconfigure feeders. Transmission:    46 kV model in ETAP is complete. Anyama has completed a study of our 46 kV system using peak loads. Winchester Road from Naugher Road to Michael Drive. Job is complete. Oakwood University relocation. Waiting on the school. Coming up with a plan to temporarily feed existing services so old line can be taken down. Substations: ________________________________________________________________________________ Master Page # 117 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019     Pole and switch installed at Engelhard Substation. Waiting for a planned outage to finish the work in the station. Need to do wiring for transformer and switcher status points at Thornton. No progress due to crew priorities. Raw Water Substation – new fence to be done in FY 20. Breaker 874 at the Huntsville Primary Substation has been replaced. Distributed Generation:  No activity this month. Fiber:  Worked on permits. Mapping:  No activity this month. RFI, EMF, PCB and Environmental:   Retrieved EMF data in the field and spoke with the customer at 105 Soybean. Retrieved EMF data in the field at 123 Ware. Power Quality:  No activity this month. Pole Attachment Process:  Working on standards. GAS ENGINEERING GAS CAPITAL BUDGET PROJECTS: Greenbrier Area Expansion: (Carryover) (Category 51-4) See separate report on Greenbrier Area Expansion Green Mountain Extension: (Category 51-5) $100,000  Description: Install approximately 2,500 lf of 6” PE gas main from Bailey Cove Road to Greentree Trail in a joint trench with water.  Status: Not started.  Plans: Proceed with Green Mountain water main and booster pump station.  Schedule: Coincide with water main installation. Water project focused on property acquisition. Martin Road Relocates (Old Jim Williams to Laracy): (Category 52-1 Carryover) $299,500  Description: City of Huntsville reimbursable road project to relocate approximately 6,000 lf of 8” PE to clear way for the widening of Martin Road by the City of Huntsville. Budget amount is $300K.  Status: Waiting for project authorization. COH has project scheduled for Summer 2019, ALDOT has project scheduled for FY 2023.  Plans: Continued coordination with ALDOT and City of Huntsville.  Schedule: Externally Scheduled: Coordinating with ALDOT and City of Huntsville on project authorization. Memorial Parkway Relocates (Mastin Lake Overpass): (Category 52-3 Carryover) $1,900,000  Description: Reimbursable road project to relocate existing gas mains to clear way for the construction of an interchange at Mastin Lake and Memorial Parkway by ALDOT. Relocation will be performed by HU contractor. Reimbursed by ALDOT at 100%, no betterment planned. Budget amount is $350K. Updated Cost Estimate is $1.9M. ________________________________________________________________________________ Master Page # 118 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019    Status:  Received ALDOT approval for design. Conducted design kick-off meeting on July 22, 2019. ALDOT is planning a clearing and grubbing project ahead of the roadway project. Utilities will be relocated immediately after the clearing and grubbing.  Had 60% design review with Barge and Welti Engineers. No changes to the gas plans were made.  SAHD #2 Reimbursement Agreement submitted to ALDOT October 4, 2019. Plans: Have Final Design meeting in November 14, 2019. Schedule: Externally Scheduled: Gas relocation dependent on ALDOT ROW acquisition. Clearing and grubbing project is scheduled to begin January/February 2020. Utility Authorization currently planned January 2020. Northern Bypass Relocates (Pulaski Pike to Memorial Parkway): (Category 52-4) $1,500,000  Description: Reimbursable road project to relocate approximately 15,000 lf of 14” welded steel to clear way for the construction of the Northern Bypass by ALDOT. Relocation will be performed by HU contractor. Reimbursed by ALDOT at 100%, no betterment planned. Budget amount is $1,950K. Updated Cost Estimate is $3.15M.  Status: Submitted Utility Consultant Agreement to ALDOT for concurrence. This project has been changed to a 100% City of Huntsville funded project. Discussions are ongoing between the City of Huntsville and ALDOT regarding utility reimbursement. Began researching potential areas that the gas main may have been installed in an easement. Any areas that the gas main was installed in an easement that require relocation should be reimbursable by the entity requesting relocation.  Plans: Continue to monitor the discussions between the City of Huntsville and ALDOT regarding utility reimbursement  Schedule: Externally Scheduled: Gas relocation dependent on ALDOT ROW acquisition. Bridge Crossing Inspection and Repair (Year 1) Category 52-05) $185,000  Description: Two-year project for inspection and repair of exposed gas main on 37 bridge crossings. Year 1 includes 18 crossings.  Status: Crossing are identified and prioritized for first year.  Plans: Still being developed.  Schedule: None at this time. Misc Relocations: Wayne Road Relocation: (Category 52-6) $200,000  Description: County road and intersection improvements frequently are not planned far enough in advance for proper budgeting.  Status: Wayne Road: Identified locations on potential conflicts and developed approach on resolution. Madison County open bids for road project on March 1, 2019. Madison County coordinating funding with COH.  Plans: Wayne Road: Relocations, if required, performed during road widening project.  Schedule: Wayne Road: Externally Scheduled: Dependent on Madison County bid and construction schedule. Misc Relocations: Cecil Ashburn Relocation: (Category 52-6)  Description: Relocate 4” Welded Steel and 6” PE Gas main related to Cecil Ashburn Road project.  Status: Conflicts found near intersection with Donegal and at the intersection with Old Big Cove Road. HU crews have adjusted valves near the intersection of Avalon and Cecil Ashburn. HU crews have relocated approximately 700 ft. of 6” and 300 ft. of 4” gas main along Old Big Cove Road to clear conflict on the east side of Old Big Cove near the intersection with Cecil Ashburn.  Plans: Address conflicts during construction with Gas Department crews.  Schedule: Externally Scheduled. ________________________________________________________________________________ Master Page # 119 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 OTHER GAS ENGINEERING PROJECTS: Zierdt Road Relocates (Madison Blvd to Martin Road) (Carryover): (FY2018, 52-2)  Description: Reimbursable ALDOT project to identify and resolve conflicts between existing gas mains and drainage structures required for the widening of Zierdt Road. Reimbursement agreement with City of Huntsville in amount of $118K.  Status:  Drainage conflict with 18” gas main at the intersection of Zierdt Road and Madison Blvd. has been resolved through redesign of drainage and rock shield installation.  Currently identified 3 conflicts with 8” PE mains along Zierdt Road.  HU Gas crews relocation of approximately 600 lf of 4” PE gas main in the NE corner of the intersection of Shelton Road and Madison Blvd has been completed with the old main abandoned.  Plans:  Remaining conflicts handled during construction by Gas Department crews.  Schedule: Conflict resolution will be in conjunction with the road project. Jeff Rd (Capshaw to Kelly Springs):  Description: Madison County ALDOT project to widen Jeff Road from 3,000 feet south of Capshaw Road to north of the Kelly Springs Road for a distance of approximately 4 miles. Relocation could impact existing 18-inch-high pressure main along Jeff Road. Cost is reimbursable.  Status: o Road widening project is at 30% design stage. o Per the surveyed gas main from Garver, approximately 7,000 linear feet of gas main will be in conflict with road project. There are 4 regulator stations and several test stations that would also need to be moved. o Generated cost estimate for Garver and Madison County. o Anticipated that roadway project is scheduled to begin in FY 2022  Plans: o Coordinate any relocations with Garver and Madison County as necessary. WATER ENGINEERING WATER CAPITAL BUDGET PROJECTS: Cecil Ashburn Transmission Main and Booster Pump Station (Carryover): (FY2018, 51-4) $750,000 Description: Construct 15,500 lf of 12” main and booster pump station in conjunction with City's project to widen Cecil Ashburn.  Status:  Water Main: Water main installation has begun. 15,693 feet of pipe and valves for new booster station have been installed.  Booster Station:  Construction began on July 8, 2019. To date, the site has been cleared and the building pad has been cut to subgrade elevation. The access road from Joey Road has been graded in and stone placed on it. Contractor has installed header pipes and is pressure testing them prior to starting building construction.  Contractor has poured equipment pads and foundation footers for the building.  Contractor has poured concrete slab for the building.  Plans:  Continue coordination on water main installation.  Contractor to start with masonry work on the building.  Schedule:  Water Main: Externally Scheduled. Dependent on City of Huntsville contractor water main installation plans.  Booster Station: Complete Booster Station by January 10, 2020. Bailey Cove Phase I (Ditto Marina to Hobbs) (Carryover): (BWO 2018-151-5) $1,000,000 ________________________________________________________________________________ Master Page # 120 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019     Description: Construct 7,500 lf of 24” main along Bailey Cove Road from Ditto Marina Parkway to Hobbs Road. Status:  Held Bid Opening on June 6, 2019. Issued Intent to Award to Garney Construction. Received legal approval of insurance documents and bonds.  Conducted preconstruction meeting on 9/24/19.  Contractor has mobilized to site and begun potholes for existing utilities. Plans: Begin laying water main week of November 4, 2019. Schedule: Contractor plans to start work on 10/14/19. Mid-City Area Improvements (Carryover) (BWO 151-2018-8) $800,000  Description: Installation of new 12-inch ductile iron water main from Research Park under Research Park Bvld SR255 to provide additional service to Mid-City. Installation will be performed by bore contractor and HU Water Crews. Joint project between Engineering Planning and Engineering Services.  Status: Entered into an Engineering Services Agreement with Volkert for survey, design under SR255, and obtain ALDOT permit.  Plans: Volkert complete design and ALDOT permit. Contractor will bore under SR255. HU Water Crews complete main installation.  Schedule: Has not been established. Greenbrier Area Expansion: (Category 51-4 Carryover) See separate report on Greenbrier Area Expansion Green Mountain Extension Phase 2A: (Category 51-8) $750,000  Description: Engineering and construction of new main, booster stations and tanks to serve the Green Tree Road area that is currently served by a double regulated area. Property acquisition required for tank and pump sites.    Status:  Overall: HU staff has reviewed properties identified by Constantine for required booster pump stations and tanks. Additional, met with two property owners about a future booster station site at the end of Green Tree Trail. Currently determining property requirements at location.  Tank at Pump Station 2: Completed property acquisition adjacent to existing Green Mountain Pump Station #2. Plans:  Overall: Continue to coordinate with Constantine prior to continuation with property acquisition.  Tank at Pump Station 2: Receive updated proposal from Constantine for Engineering Services for design and bid package for 150,000 ground storage tank. Schedule: Begin design after property acquisition. Pulaski Pike/NHIP (Replace Tie to County) (Category 51-9) $625,000  Description: Replace dedicated 16-inch ductile iron water main from Liberty Hill Tank to feed Madison County Pump Station at corner of Pulaski Pike and Monroe Road. This project will replace the section of main from Liberty Hill Tank to Routt Road which was used to feed Facebook in a higher pressure zone. Installation by HU Water Crews.  Status: Not started.  Plans:  Schedule: Bob Wade Booster (Category 51-10) $1,000,000  Description: New booster station to serve future needs in the North Huntsville Industrial Park. Future demand on Liberty Hill Tank is expected to exceed capacity to fill the tank.  Status: Identified property and started coordination with COH for acquisition. Coordinating with General Counsel on title search. ________________________________________________________________________________ Master Page # 121 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019   Plans: Acquire Engineering firm and begin design in 1st quarter FY20 Schedule: Not defined. South Parkway Raw Water Access Road (Category 51-11) $200,000  Description: New access road to South Parkway Plan Raw Water Intake on Tennessee River. Cost sharing with Ditto Marina.  Status: Plans are 90% complete.  Plans: Finalize plans and coordinate bidding through Ditto Marina\COH  Schedule: Currently coordinating with Ditto Marina Limestone County Improvements (Category 51-14) $1,000,000  Description: Water main improvements in the Limestone County Water service area being acquired by Huntsville Utilities.  Status: Hydraulic model update will be completed in November.  Plans: Use updated hydraulic model to begin identifying potential projects.  Schedule: Identify potential project by January 2020. Misc. Road Relocations & Street Pavement (Category 52-3) $200,000  Description: City and County road and intersection improvements frequently are not planned far enough in advance for proper budgeting. Wayne Road is current project  Status:  Wayne: Released drawings to HU Water Crews to conflict avoidance in three locations. Madison County open bids for Road Widening on March 1, 2019. Madison County coordinating funding with COH. Notified County that main cannot be taken out of service due to high flows during summer and that project will need to wait until the October time frame.  Plans:  Wayne: Continued coordination of relocation with Water and Madison County.  Schedule:  Wayne: Scheduled based on Water Department availability and Madison County Staking drainage. South Parkway Raw Water Station Rehab (Category 52-4) $1,500,000  Description: Rehabilitate raw water pump station serving South Parkway Water Treatment plant  Status: Conducted 60% design review meeting on raw water pump station on October 16, 2019.  Constantine provided revised site layout for raw water pump station. Site layout reviewed and determined additional space was preferred. HU continued coordinating additional property for raw water station.  Plans: Constantine  Schedule:  Complete raw water pump station design in 1st quarter FY20 and begin bidding in January 2020. South Parkway Main Plant Rehab (Engineering) (Category 52-5) $1,700,000  Description: Prepare construction plans, specifications, bid documents to upgrade aging raw water station, clarifiers, clear well, and appurtenances that were originally constructed in the 1960's and 1970's.  Status:  Engineer, Constantine, submitted final Preliminary Design Report (PDR) for South Parkway Plant on March 22, 2019.  Plans:  Treatment plant rehabilitation is budgeted in several phases across multiple fiscal years.  Schedule:  Finalize scope and begin design of treatment plant in 1st quarter FY20 based on project funding. Memorial Parkway (Mastin Lake to Winchester): (Category 52-6) $2,500,000 ________________________________________________________________________________ Master Page # 122 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019     Description: ALDOT reimbursable road project to relocate existing water main from along Memorial Parkway from south of Mastin Lake to Winchester Road to accommodate new bridge at Mastin Lake. Project was not included in the FY 19 budget, but was included in the FY 20 CIP Budget. Reimbursed by ALDOT. Updated Cost Estimate is $2.2M. Status: Received ALDOT approval for design. Conducted design kick-off meeting on July 22, 2019. ALDOT is planning a clearing and grubbing project ahead of the roadway project. Utilities will relocate immediately after the clearing and grubbing. Conducted 60% design review meeting September 23, 2019. Submitted SAHD #2 Reimbursable Agreement to ALDOT on October 4, 2019. Plans: Have Final Design meeting in November 14, 2019. Schedule: Externally Scheduled: Gas relocation dependent on ALDOT ROW acquisition. Clearing and grubbing project is scheduled to begin January/February 2020. Utility Authorization currently planned January 2020. Northern Bypass Relocates (Pulaski Pike to Memorial Parkway): (Category 52-7) $750,000  Description: ALDOT reimbursable road project to relocate existing water main from East of Pulaski Pike to US 231/431. Reimbursed by ALDOT. Budget amount is $2,250K. Updated Cost Estimate is $735K since hydraulic modeling indicated that the proposed 24” main along the project was not hydraulically advantageous.  Status: Submitted Utility Consultant Agreement to ALDOT for concurrence. This project has been changed to a 100% City of Huntsville funded project. Discussions are ongoing between the City of Huntsville and ALDOT regarding utility reimbursement.  Plans: Continue to monitor the discussions between the City of Huntsville and ALDOT regarding utility reimbursement.  Schedule: Externally Scheduled: Water relocation will be included in road widening project. WATER OTHER PROJECTS: Liberty Hills Booster Pump Station (Carryover): (BWO151-2018JanLH)  Description: New pump station in the North Huntsville Industrial Park to increase pressure and flow to the Facebook development.  Status:  Pump Station IFB 18-56: Punch list inspection completed on August 13, 2019. Contractor has completed punch list items. Final Acceptance inspection completed on October 8, 2019. Change Order 1 has been executed. Liquidated damages in the amount of $6,450 were assessed on the contract.  Pumps and Controls IFB 18-55: Pump testing conducted on July 25 and 26. Pumps operational. However, the control scheme is not working properly using the PLC or the VFD drives. Clarifying instructions provided to Eshelman/Patterson. HU, Garver, Eshelman and Schneider personnel conducted additional testing and configuration on-site on August 27 and 29-30. Currently, operating permanent Liberty Hills pump station on the two small pumps. After consulting with Garver, Eshelman, and Patterson personnel determined optimal approach for pump controls was to install true check valves and flow meter. HU is acquiring new check valves and flow meter for installation by HU Pump Station Maintenance personnel  Generator IFB 18-54: Generator and transfer switch transported to site, installed, and load tested. Final invoice has been paid.  Temporary Pump: Installed but not currently being used.  Plans:  Pump Station: Continue contract close-out. o Pumps and Controls: HU personnel install new check valves and flow meter. Afterwards, additional testing and potential program changes may be required.  Schedule:  Pump Station: Complete. o Pump and Controls: Complete check valve and flow meter installation in November. Meeting scheduled with Patterson on November 15, 2019 for discussion of pump controls. ________________________________________________________________________________ Master Page # 123 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Bailey Cove Phase II (Hobbs to Mountain Gap) – Engineering: (BWO 5019-151-8)  Description: Engineering for 7,000 lf of new 24” and 16” main along Bailey Cove Road from Hobbs Road to Green Mountain Road.  Status: Conducted 60% review meeting on August 23, 2019. Constantine is beginning vertical locates on existing gas and water mains, as well as some storm drain crossings.  Plans: Constantine prepare 90% drawing after vertical locates completed.  Schedule: Not established. Martin Road Relocates (Old Jim Williams to Zierdt) (Carryover): (BWO2018-252-4)  Description: Reimbursable road project to relocate approximately 7,000 lf of existing 18” main to clear way for the widening of Martin Rd. by City of Huntsville. Water main installation included in ALDOT roadway project and paid directly by ALDOT.  Status:  Contractor has installed 7,870 feet (97%) of main and completed all bores. Contractor has pressure tested 7,235 feet (89 %) of water main that has passed.  Contractor has connected the existing main into the section of new main already installed. Contractor has transferred all the customers to the new main from Zierdt Road to the connection of the old main and the new main.  Plans: Continued construction observation.  Schedule: Based on road construction. Zierdt Road Relocates (Martin to Madison Blvd) (Carryover): (BWO-2018-252-5)  Description: Reimbursable road project to adjust 6" and 8" laterals and service line reconnection to clear way for the widening of Zierdt Road by the City of Huntsville. Reimbursed by City of Huntsville. Agreement amount is $199K.  Status: Point of sale meter has been installed. Waiting for City of Madison to install backflow device.  Plans: Connect to Madison’s backflow preventer to clear way for new pavement.  Schedule: Externally Scheduled: Resolve any conflicts in coordination with road widening project. GREENBRIER AREA GAS AND WATER EXPANSION    Description: Expand gas service in the Greenbrier area to serve the Mazda-Toyota Manufacturing US (MTMUS) plant and associated vendors and commercial development. Additionally, provide water service to MTMUS plant complex. o Install 12-inch welded steel gas main inside the MT site and along Greenbrier Parkway and Old Highway 20. o 12-inch ductile iron water main will be installed on the plant site. 16-inch ductile iron water main is planned along Greenbrier Parkway. Status: o Phase 1 – On-site and Greenbrier Road.  Construction Contractor has installed and successfully pressured tested all 12” steel gas main. Additionally, contractor has installed, pressure tested, disinfected and placed in service all 12” ductile Iron water main.  Contractor has installed 5,700 feet or 80% for 8 inch PE Gas Main.  Received fully executed documents from Norfolk Southern for gas bore under railroad tracks on Greenbrier Road. Ordered and received casing pipe. Contractor has started bore. o Phase 2A (Greenbrier Parkway) and Phase 2B (Old Highway 20)  Phase 2A: Finalized design. Began procurement process.  Phase 2B: Received 90% plans and specifications. Received approval from Norfolk Southern for gas main crossing railroad tracks on Old Highway 20. Continued coordination with COH and property owners for required easements. Appraisals for easements have been completed o Phase 3: New Gate Station on Greenbrier Parkway  Coordinated with COH on using city owned property for new gate station. Received verbal agreement. Plans: ________________________________________________________________________________ Master Page # 124 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Phase 1: MTMUS Site and Greenbrier Road  Rast Construction complete bore under railroad tracks on Greenbrier Road. Rast Construction complete installation of PE gas main, pressure test gas main and place into service o Phases 2A (Greenbrier Parkway) and 2B (Old Highway 20):  Phase 2A: Continue procurement and begin award activities  Phase 2B: Continue acquisition of 2 permanent and 1 temporary construction easements. Continue coordinate with US Army Corps of Engineers on wetland permit. Conduct formal design review. o Phase 3: New Gate Station on Greenbrier Parkway  Selected engineering firm to design the gate station and started contracting process.  Formalize the site for the new gate station with COH. Schedule: o Phase 1:  Complete PE main on Greenbrier Road which will supply low pressure gas for minimal heating by November 2019. o Phase 2:  Phase 2A: Conduct pre-bid meeting on November 7. Open bids on November 21, 2019.  Phase 2B: Finalize drawings & specifications in November and begin bidding in December 2019. o Phase 3: Begin design after professional services contract is approved. o  RELOCATE WATER MAINS FOR RAILROAD EXPANSION FOR MAZDA-TOYOTA  Description: Norfolk Southern Railroad adding additional tracks to support the Mazda- Toyota Facility. The additional tracks will impact water mains installed in ROW on Old Highway 20, Greenbrier Road, and Greenbrier Parkway. Existing water mains will require re-installation in order to accommodate additional tracks.  Status:   o Greenbrier Parkway: All Work complete. Contractor working for Norfolk Southern has complete excavation for new track over the relocated water main. o Greenbrier Road: Received fully executed agreement from Norfolk Southern for water main bore under existing and proposed tracks. Executed Change Order 1 with Rast Construction which added water bore to contract. Order and received casing and piping materials for bore. o Old Highway 20: Executed agreement with S&ME for installation of 16” water main in 24” casing under Norfolk Southern railroad tracks. o MTMUS Spur Across Old Highway 20: Began coordination with MTMUS and COH on new rail spur serving MTMUS. Plans: o Greenbrier Parkway: Complete o Greenbrier Road: HU Water crews install isolation valve on Greenbrier Road. Rast complete water bore after gas bore is complete. HU Water crews connect to new main under railroad tracks. o Old Highway 20: Water relocation completed at same as gas bore under railroad tracks. o MTMUS Spur: Begin planning water main relocation for new tracks. HU will install 16” main in 24” casing under track of proposed spur. Schedule: o Greenbrier Road: November. HU crew install isolation valve in November. Rast Construction complete bore in o Old Highway 20: Scheduled with Phase 2B. o MTMUS Spur: Not scheduled. Need information from MTMUS and COH. ________________________________________________________________________________ Master Page # 125 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MAPPING DEPARTMENT SUMMARY We met internally and with vendors, reviewed qualifications, attended workshops, conferences and demonstrations to better understand the functional needs, practical wants associated with our GIS platform migration and Oms selection. We took an excellent cross section of employees from all affected departments to review the products and workflows presented at the ESRI Utility conference. We sent out GIS/OMS platform and usage survey to numerous other utilities, and solicited same, online and via phone calls. GIS: During this period 29 commercial plats and 15 subdivision plats were fitted and posted to our base, 7 final plats and 8 preliminary. Numerous maps and/or data were updated from these sources. Greenfield data continues to be captured and shared with all fiber concerns on various platforms. We delivered, per agreement, all the structures and street from the 2019 photography to the Tax Assessors office. We continue base map conversion. The LiDAR Grant acquisition with USGA, FEMS TVA and NOAA.is being scheduled for the first leaf off window we get this winter. We continue our search for a new GIS and OMS platform. Locates: We received 5,775 locate requests this month, 2,988 were received by HU and 2,787 were received by USIC. 739 requests were cleared by the Locations Clerk, 3,055 requests required location of electric facilities, 3,008 requests required location of gas facilities, and 2,876 requests required location of water facilities and 2.411 requests required fiber facilities to be located. With continued assistance and overview by our clerk, the Koterra application and the USIC locates continue to run smoothly. USIC is performing all locates associated with the LCWSA purchase. Facility Mapping: We have maintained, mapped and/or located all the necessary base, plat and address data for the LCWSA acquisition. Between new plats, our maps and SAP corrections we added or corrected 229 addresses. We continue to work to discover and resolve all duplicate and orphaned SAP address records. We continue to support Foresite, Google, TBG on a daily basis to research and validate potential fiber addresses for our fiber build. We continue to provide ALDOT permitting support for our fiber build. Switch map maintenance is supported as needed. Stacy Cantrell, Vice President of Engineering SC: em ________________________________________________________________________________ Master Page # 126 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Residential Lots Developed Cummulative FY Totals by Month 3,500 Fiscal Year Cummulative Totals 3,000 2,500 2,000 1,500 1,000 500 0 Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. FY15 175 274 298 416 424 499 505 563 758 913 955 1,095 FY16 124 148 165 314 351 501 625 828 945 983 1,064 1,342 FY17 211 235 252 401 438 588 712 915 1,032 1,070 1,151 1,429 FY18 176 205 322 754 846 1,003 1,227 1,309 1,384 1,731 2,111 2,180 FY19 133 303 383 439 754 948 1,160 1,425 1,919 2,317 2,794 3,066 FY20 264 FY20 Projection 264 ________________________________________________________________________________ Master Page # 127 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Gas Service Line Requests Cummulative FY Totals by Month Cummulative Service Line Requests 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. FY15 102 173 249 328 408 476 579 646 759 838 925 1,031 FY16 83 171 256 317 430 545 612 756 860 967 1,072 1,165 FY17 91 173 229 323 381 512 622 758 841 932 1,061 1,134 FY18 104 213 304 410 532 641 779 967 1,093 1,195 1,334 1,430 FY19 146 275 386 546 700 834 1,002 1,184 1,315 1,471 1,636 1,770 FY20 113 FY21 Projection 113 New & Existing Residential Gas Service Lines By Month By Year 2015-2019 200 180 160 140 120 100 80 60 40 20 0 Jan Mar May Jul 2015 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May 2016 Jul Sep Nov 2017 New House Jan Mar May July 2018 Sep Nov Jan Mar May July Sep Nov 2019 Existing House ________________________________________________________________________________ Master Page # 128 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 ATC Posted ($) FYTD Cummulative Electric ATC Posted by Month 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept FY16 $251,699 $477,392 $690,702 $959,508 $1,155,289 $1,683,396 $1,962,131 $2,457,644 $2,786,571 $2,992,809 $3,469,070 $4,171,277 FY17 $388,875 $708,728 $785,129 $1,296,588 $1,591,256 $2,246,584 $2,664,606 $3,112,852 $3,649,343 $3,954,273 $4,452,755 $5,040,792 FY18 $417,542 $648,925 $927,648 $1,617,731 $2,320,405 $3,028,968 $3,808,748 $4,483,865 $4,837,241 $5,723,613 $6,919,661 $7,258,470 FY19 $414,795 $1,128,882 $2,124,358 $2,290,983 $3,019,659 $3,519,734 $4,136,352 $4,924,070 $6,051,494 $6,883,121 $8,352,256 $9,067,052 FY20 $516,120.75 FY20 Projection $516,121 FYTD Cummulative Water ATC Posted by Month $6,000,000 ATC Posted ($) $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 FY16 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept $1,026,362 $1,310,350 $1,651,302 $1,809,332 $2,591,711 $2,907,581 $3,002,371 $3,125,665 $3,499,718 $4,080,190 $4,513,067 $4,876,405 FY17 $241,822 $605,177 $752,921 $788,851 FY18 $274,059 $344,819 $671,649 $825,651 FY19 $132,954 $415,156 $558,161 FY20 $359,621.0 $886,297 $1,433,394 $1,480,044 $1,664,882 $2,537,793 $2,825,256 $2,877,836 $3,282,756 $1,054,217 $1,522,975 $1,914,988 $2,243,830 $2,489,150 $3,034,175 $3,588,674 $4,307,005 $1,537,479 $2,003,260 $2,186,912 $2,783,551 $3,464,801 $3,531,841 $3,768,868 $4,408,892 $4,741,003 FY20 Projection $359,621 ATC Posted ($) FYTD Cummulative Gas ATC Posted by Month $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept FY16 $74,002 $109,432 $147,649 $182,218 $235,623 $298,993 $334,833 $468,452 $538,192 $580,082 $655,210 $703,596 FY17 $53,655 $93,801 $123,271 $308,515 $350,575 $406,565 $492,533 $560,958 $622,538 $671,511 $986,178 $1,028,968 FY18 $44,295 $91,555 $138,840 $186,670 $253,714 $302,654 $392,264 $464,364 $518,212 $580,043 FY19 $108,886 $186,861 $243,131 $329,906 $418,153 $482,258 $570,863 $668,289 FY20 $69,710.00 FY20 Projection $1,279,800 $1,333,416 $1,151,542 $1,210,027 $1,281,470 $1,348,870 $69,710 ________________________________________________________________________________ Master Page # 129 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Huntsville Utilities and USIC Tickets per Day 250 200 150 100 50 HU 10/31/2019 10/30/2019 10/29/2019 10/28/2019 10/27/2019 10/26/2019 10/25/2019 10/24/2019 10/23/2019 10/22/2019 10/21/2019 10/20/2019 10/19/2019 10/18/2019 10/17/2019 10/16/2019 10/15/2019 10/14/2019 10/13/2019 10/12/2019 10/11/2019 10/10/2019 10/09/2019 10/08/2019 10/07/2019 10/06/2019 10/05/2019 10/04/2019 10/03/2019 10/02/2019 10/01/2019 0 USIC 70000 60000 50000 40000 30000 20000 10000 0 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 ________________________________________________________________________________ Master Page # 130 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Customer Care Monthly Overview Customer Service October 2019 PERCENT OF CUSTOMERS APPLYING ONLINE VS. WALK-IN MAIN OFFICE LOBBY WALK-IN Payments Applications Customer Inquiries TOTAL CUSTOMERS 7,519 1,482 1,973 100% 10,974 70% 90% 80% 60% TOP 5 INQUIRIES (Walk-Ins) New Contracts IP Discussed/Keyed Move Contracts Payment Options/More Time Amount of Bill 50% 870 705 213 184 155 40% 30% 20% 10% 0% Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 COLLECTION ACTIVITY Write-offs Revenue Collected Net Uncollected Power Diversion Owed Power Diversion Collected DWO Collected TOTAL REVENUE COLLECTED Apr-19 Percent Walk-In CALL CENTER ACTIVITY Total Calls Received Calls Handled by IVR Calls Handled by Agent Abandoned Rate Service Level (calls answered <60 secs) Mar-19 30,444 943 29,501 1.35% 85.37% KIOSK PAYMENT ACTIVITY Cash 1475 FY 2020 $42,995 $17,995 $25,000 $6,623 $6,845 $37,426 $62,266 2666 1323 1327 2544 2515 Credit/ Debit 1285 1179 2876 2923 Check 1327 1281 1276 1198 1237 2974 2892 2727 3038 Jul-19 Aug-19 Sep-19 Oct-19 PAYMENT METHOD TRANSACTIONS 1240 1120 648 3274 3127 Jun-19 Percent Online New User 3068 May-19 3489 Drop Box 3,847 2% EFTs 20,874 11% Kiosk 6,563 4% Western Union 30,066 16% 2308 2134 2071 2221 2084 2217 2254 2299 2042 2057 2235 2312 2426 Bank Draft 75,815 41% ________________________________________________________________________________ Master Page # 131 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Walk-In 7,519 4% Drive-Thru 10,697 6% Mail 30,706 16% Customer Care Monthly Overview Customer Service October 2019 REVENUE COLLECTED WALK-IN CUSTOMERS 20,000 120,000 100,000 Revenue Customers 15,000 10,000 5,000 80,000 60,000 40,000 20,000 0 0 Installment Plan Discussed/Keyed 911 574 301 Applications Customer Inquiries General Inquiry 238 Bad Debt Payments CALL CENTER PERFORMANCE Power Diversion Damage Work Orders C ALL C ENTER S ERVICE Q UEUE 100.00% 90.00% 80.00% 70.00% 60.00% Service 22% FY 2020 50.00% Billing Inquiry 28% 40.00% 30.00% 20.00% 10.00% 0.00% Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Abandon Rate Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Payment Agreement 50% Service Level ________________________________________________________________________________ Master Page # 132 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Customer Care Monthly Overview Customer Relations October 2019 Billing Implausibles Electric Water Gas Total Average Implausibles by Reason Code 41,376 45,150 13,380 99,906 Implausibles by Commodity 110,000 23% 100,000 90,000 80,000 56% 9% 70,000 40,141 39,832 13,126 12,039 11,254 38,646 35,176 32,970 July August September 60,000 C&I APPLICATIONS Walk-In Fax Requests Phone Calls METER READING Scheduled Readings Actual Readings FIELD SERVICE Cuts Generated Disconnects Dead Meters Orders Completed Dead Meters Found 50,000 12% 40,000 392 182 2,255 341,114 337,223 16,928 715 13,380 30,000 20,000 10,000 41,376 0 Consumption Estimations Exceeded Previously Implausible Tolerance Limits Electric CSP Funds Utilized Per Program October 2019 Ultra-Sonic Testing 1,256 68 45,150 39,246 Power Quality Analysis Special Metering $5,860.50 $6,607.50 $26,331.00 $30,972.00 Infared Scan Energy Audit $5,507.50 Water Dead Meters By Service Type $4,767.50 Meter Test / Submtr / Profile Gas October 80 75 70 65 60 55 50 45 40 35 30 25 20 15 10 5 0 73 62 53 50 8 7 0 July 3 0 August Electric 6 0 0 September Water October Gas ________________________________________________________________________________ Master Page # 133 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Customer Care Monthly Overview Customer Relations Billing: Implausibles Month Electric October November December 2018 YTD Total January February March April May June July August September October 2019 YTD Total 30,467 31,079 35,847 290,722 28,181 33,319 37,526 34,898 40,315 36,956 38,646 35,176 32,970 41,376 359,363 Gas 10,518 14,044 13,080 114,527 10,736 12,051 12,808 12,853 13,217 13,106 13,126 12,039 11,254 13,380 124,570 Water Total 32,638 32,816 33,444 313,801 31,385 36,457 36,915 35,969 40,223 38,944 40,171 39,246 39,832 45,150 384,292 73,623 77,939 82,371 719,061 57,509 63,605 87,249 83,720 93,755 89,006 91,913 86,461 84,056 99,906 837,180 C&I Applications Month Estimations Previously Exceeded Implausible 9,425 9,641 8,853 112,831 8,330 7,367 9,151 9,360 10,094 8,773 9,133 8,755 9,474 8,533 88,970 3,843 3,673 3,501 42,405 3,476 3,340 3,836 3,642 3,516 3,361 3,483 3,258 3,195 3,369 34,476 1,213 1,186 850 12,514 464 1,585 2,993 2,922 3,508 4,045 3,867 2,724 2,810 4,290 29,208 Meter Reading Fax Walk-In Requests October November December 2018 YTD Total January February March April May June July August September October 2019 YTD Total Zero Consumption 372 378 261 4,409 630 431 376 356 381 445 386 382 332 392 4,111 417 257 142 3,910 205 111 121 185 177 174 165 171 190 182 1,681 Phone Calls 1,738 1,524 1,392 18,931 2,543 2,476 1,868 2,205 1,967 1,995 2,342 2,628 1,999 2,255 22,278 Month October November December 2018 Total January February March April May June July August September October 2019 Total Tolerance Limits Total New 19,528 21,976 24,345 227,971 15,367 14,415 22,092 19,922 22,440 21,257 18,538 17,067 16,258 20,398 187,754 Control Reads 34,009 36,476 37,549 395,721 27,637 26,326 38,068 35,846 39,558 37,436 35,021 31,804 31,737 36,590 340,023 3,563 3,398 3,816 41,380 3,331 2,818 2,609 2,574 3,140 3,738 3,837 2,774 2,580 3,700 31,101 Routes 620 579 600 7,207 623 600 579 601 616 584 618 610 583 6,043 11,457 Field Services Scheduled Readings 388,656 364,472 373,074 4,522,280 381,366 364,387 377,327 358,466 358,756 336,161 350,910 340,772 321,135 341,114 3,530,394 Actual Readings 384,535 359,213 367,365 4,475,009 374,664 355,485 352,007 353,513 353,928 331,315 345,924 336,368 317,151 337,223 3,457,578 Month October November December 2018 Total January February March April May June July August September October 2019 Total Cuts Generated Disconnects 17,463 16,829 18,005 189,469 21,019 14,617 12,612 14,455 17,200 17,200 15,837 13,728 14,772 16,928 158,368 927 648 567 9,289 1,085 865 867 772 667 667 481 548 584 715 7,251 ________________________________________________________________________________ Master Page # 134 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 Communications/Public Relations Department Monthly Report October 2019 PROJECTS/ACTIVITIES:                  Project Share Marketing Plan KPI Development Planning for 2019 HU’s Veterans Day Breakfast Logo Standard Manual – Ready for Review 80th Anniversary Logo – In Production Natural Gas ad in Hampton Cove publication for November – “Why chef’s prefer natural gas” Two November Bill inserts  Project Share Christmas promotion  Huntsville Water Trail Collected school supplies for Jemison HS (binders from HR) Completed teacher’s gifts for Education Days Working with Huntsville/Madison County Chamber PR Dept. for Project Share promotions Spotlight Business article for Hampton Cove magazine Veterans Day Ad for Redstone Rocket Researched Ad ideas for 2020 Dr. Martin Luther King, Jr., Unity Day program Created new HUES logo and updated flyer for release to HCS Coordinating Project Share details for Christmas Promotion Assisting Water Department with Business Council of Alabama’s Manufacturer of the Year Award entry Completed two-weeks of Education Days at Chase Operations Center VIDEO & PHOTO PRODUCTION                Natural Gas Video - David Pritchett & Rick Miller Electricity - Pumpkin Spice Video Wes Kelley and Jay Stowe speaking at AL/MS American Planning Association Conference 2019 Natural Gas Apprentice Dinner Slideshow 2019 Natural Gas Apprentice Graduation Photos Tribal App video for monitors Education Days Dispatch video used during Dispatch Presentation Photos of First Responder Award Photographs during all activities of the Customer Care Week events Photographs at the Company Picnic Tribal Photographs to kickoff the roll out company wide Photographs of the Lip Sync Contest Winners Photographs taken at Education Days activities Photograph Safety Department for their new badge roll out Photograph & Video footage for new Project Shares ads that will roll out in Nov ________________________________________________________________________________ Master Page # 135 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019      Photograph the APGA dinner at the Davidson Center Photograph vendors and speakers at APGA conference Photograph Schools Foundation meeting taking place at HU Photograph HU celebrating Halloween around the building and company wide Coordinated attending safety meetings to explain Tribal App and demonstrate how our employees can download it Employee Communications System (ECS) Produced 116 slides/videos for HUTV. In addition to the regular monthly features, other posts included: Information about the Breast Cancer Awareness Bake Sale, Cybersecurity Tips from IT, Job openings, Blood Drive Results, Organizational Announcements, Open Enrollment information, New generic TED Talks promotion, Our “Pumpkin Spice” commercial, Extended rebate offer on Nissan Leaf, Information about the DEA Drug Takeback event, Information about discount tickets to the Spongebob Musical, Flyer for Green Team’s native plant giveaway, Video promoting Tribal, Nationwide meeting schedule, Fall Back reminder, Dana and Patricia recognized by APPA, Announcement about being in “The Source”, Halloween Pictures Misc: Produced the highlight video for 3rd Quarter 2019 Began the rollout of Tribal to the entire company Attended APGA Operations Conference and Quarterly Meetings Artcile submitted to the APGA magazine “The Source” was published Produced “The Line” (Calendar/Newsletter) for November Arranged a blood drive for the Employee Appreciation Picnic. Goal was 15 units. HU employees donated 20. Social Media Synopsis: General: Continued our participation in the APGA’s Natural Gas Genius Campaign. Posts from Huntsville Utilities were featured in APPA’s Public Power Daily 1 time in October. Facebook: Strong numbers for the month. Triple digit gains in Likes and Followers. Audience reach of over 311,000 for the month. Twitter: Reached 16,000 Twitter Followers. YouTube: Closing in on 250 subscribers. LinkedIn: Added 50 new followers since last month. Instagram: blocked us from accessing our account for about three days. They claimed we violated their terms of use by sharing our account information with a service that helps increase likes and follows. However, we never did any such thing. Nextdoor: seems to be having a problem with their metrics provider. Website Synopsis: Continuing to work with Purchasing and IT on the website redesign. Added the “Community Powered” badge to the home page, linking back to the APPA’s “We Are Community Powered” page. Media Contacts: PR Staff made 55 contacts with local news and publishing media on topics varying in nature, including: scams; outage restoration; safety; fiber network progress; road closures for utility work, and service outages and restorations. ________________________________________________________________________________ Master Page # 136 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEETINGS/EVENTS ATTENDED: Southeast Energy Efficiency Alliance – Annual Conference (incl Panel Participation) APPA Customer Connections Conference Huntsville Chamber State Governmental Affairs Committee East Huntsville Community Line Clearance Planning Meeting LEADERSHIP Huntsville/Madison County – NASA Update with Jody Singer Huntsville Community Connections Network Huntsville Planning Commission Zoning Committee Meeting Huntsville Planning Commission Meeting Madison County Commission Huntsville City Council Meeting Alabama’s Bicentennial – HU Water Trail Project HU Overview with State Senator Tom Butler Councilman Bill Kling, District 4 Town Hall Meeting North Alabama African American Chamber of Commerce Monthly Meeting Councilwoman Frances Akridge LED Light Stroll, Jones Valley North Alabama Code Officials Monthly Meeting Southern Public Relations Federation Annual Conference North Alabama Public Relations Association BIG PR Event HMCBA Monthly Membership Meeting Leadership Huntsville Meeting w/Shannon Drake (re: Project Share) ENERGY SERVICES: New Homes: 103 HESP Inspections: 5 e-Score Post Inspections: 0 High Bill Complaint Inspections: 9 Customer Generation: 2 New e-Score Contractors: 12 ________________________________________________________________________________ Master Page # 137 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 October 2019 ELECTRIC DIVISION Name Job Title Willie Garner Crew Leader 10/5/19 Date Promotion Adam Herring Apprentice 10/5/19 Promotion - Apprentice Program Casey Selvage Apprentice 10/5/19 Promotion - Apprentice Program Christopher Swinford Journey Lineworker 10/19/19 Promotion Corey Coleman SCADA Tech I 10/5/19 Reclassification Luke Mullins Apprentice 10/5/19 Promotion - Apprentice Program Joshua Bradley Apprentice 10/5/19 Promotion - Apprentice Program Carlton Pack Apprentice 10/5/19 Promotion - Apprentice Program Gavin Calder Apprentice 10/5/19 Promotion - Apprentice Program Whitney Bommarito Clerk II 10/5/19 Step Increase - 6E - 6F William Gentle Fiber Tech I 10/5/19 Step Increase - 10A - 10B Melody Profiet System Operator I 10/5/19 Step Increase 7C - 7d Jonathan Fagan Utility Worker 10/5/19 Step Increase - 4C - 4D Explanation GAS DIVISION Name Job Title Date Explanation Jermaine Garner Apprentice 10/5/19 Step Increase Shannon Dawson Apprentice 10/5/19 Step Increase Mike Ferguson Apprentice 10/5/19 Step Increase Michael Miller Apprentice 10/5/19 Step Increase Bryan Stanley Apprentice 10/5/19 Step Increase Darrell Taylor Apprentice 10/5/19 Step Increase Christopher Watson Apprentice 10/5/19 Step Increase Kamran Saxena Apprentice 10/5/19 Step Increase Jared Solmon Apprentice 10/5/19 Step Increase Zachary Brown Apprentice 10/5/19 Step Increase John Holden Apprentice 10/5/19 Step Increase Keegan Davis Apprentice 10/5/19 Step Increase Andrew Broadway Apprentice 10/5/19 Step Increase - John Rogers Apprentice 10/5/19 Step Increase Wyatt McCoy Apprentice 10/19/19 Salary Analysis JOINT DIVISION Name Job Title Samuel Patterson Safety Officer 10/19/19 Date Martha Slaughter N/A 10/1/19 Promotion Retirement Explanation Dawn Smith Secretary 10/5/19 Promotion Brandi Holt Clerk I 10/5/19 Voluntary Demotion Josh Atchley Fleet Tech I 10/19/19 Reclassification Ronald Holder Facilities Locator 10/5/19 Step Increase 8D - 8E Jennifer Brooks CSRI 10/21/19 New Hire Teresa Patterson Secretary 10/21/19 New Hire Melanie McClure Purchasing Supervisor 10/5/19 Salary Analysis Dawn Steiner-Garner Safety and Security Manager 10/5/19 Salary Analysis Moya Kirby Buyer I 10/5/19 Salary Analysis - Grade Change ONLY WATER DIVISION Name Job Title Mark Schrimsher N/A Date Explanation 10/1/19 Retirement Grant Jones Apprentice 10/5/19 Step Increase Douglas Kelley Jr. Apprentice 10/5/19 Step Increase Dustin Maples Apprentice 10/5/19 Step Increase James Flynt Apprentice 10/5/19 Step Increase Charlse Gibbs Apprentice 10/5/19 Step Increase Phillip Ross Apprentice 10/5/19 Step Increase Benjamin Brannum Apprentice 10/5/19 Step Increase Branden Lawrence Apprentice 10/5/19 Step Increase Jonathan Knopps Apprentice 10/5/19 Step Increase Corey Jones Apprentice 10/5/19 Step Increase Adam Howard Apprentice 10/5/19 Step Increase Landon Taylor Apprentice 10/5/19 Step Increase Micah Troupe Apprentice 10/5/19 Step Increase ________________________________________________________________________________ Master Page # 138 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 2019 Human Resource Reporting Employee Badges of Recognition Jan. Feb March April May June July August September October November December Totals 4 1 1 17 3 1 6 1 6 1 8 4 1 35 8 4 62 28 6 77 44 72 Supervisor Recognition Amazing Great Work Leader Nice Person Team Player Team Work Thank You Welcome 2 3 2 3 1 8 5 6 2 8 4 1 1 2 10 5 5 1 16 6 2 14 11 29 7 2 1 4 1 11 4 5 10 3 6 2 6 12 37 33 61 8 10 42 21 26 1 1 2 2 2 3 4 1 8 3 4 1 1 5 2 2 2 5 5 6 1 1 3 2 7 4 4 1 1 1 2 4 Total 11 18 21 15 6 10 $25 Gift Card Recognition 0 2 5 1 0 Jan. Feb March April May Total 3 9 61 0 0 308 2 8 3 3 1 37 9 5 28 16 33 0 Co-Worker Recognition Amazing Great Work Leader Nice Person Team Player Team Work Thank You Welcome Disciplinary Actions Performance/Absenteeism Insubordination Safety (Preventable Vehicle Accident) Policy or Procedure 1 2 Total 3 1 1 3 8 4 1 3 1 4 3 1 2 13 18 12 12 0 0 1 1 39 June July August Sept. October 2 0 0 2 2 2 2 2 4 3 0 2 2 1 1 1 2 3 2 136 49 Nov. Dec. 3 2 1 3 4 0 8 10 0 0 22 Comments: ________________________________________________________________________________ Master Page # 139 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM To: Electric Board Gas/Waterworks Board From: Wes Kelley, President/CEO Date: November 12, 2019 Subject: November President’s Report Meeting with City Leadership As reported last month, HU and City leadership have established quarterly coordination meetings to facilitate our interactions as we collaboratively meet the needs of a growing community. The first meeting was held on October 31. The next meeting will be scheduled in mid-January. At this first meeting we discussed the following:  Fiber construction update  HU Electric bond rating downgrade  PILOT payment changes  Potential change in streetlight ownership  Potential joint-use of the former 911 facility FY20 Goals In addition to managing growing list of daily responsibilities, at the start to the fiscal year, HU management determines specific priorities for the upcoming year. To that end, departmental leaders recently met and updated the key performance indicators tied to the Strategic Plan. This information is being refined and will be presented at future board meetings. The Strategic Plan guides our work and is translated into specific goals plans disbursed throughout the organization. Below are my tactical goals for FY20.  Address HU/TVA contractual relationship  Update safety, customer service, and engineering policies  Develop improved capital budgeting approach  Review construction/development processes and cost management  Address potential changes in streetlight infrastructure  Determine the future of the fiber network  Consider updating employee compensation structure  Finalize due diligence for possible HU incorporation I’m also attaching a memorandum listing the goals for HU’s executive staff as we will work together to achieve our collective goals for FY20. ________________________________________________________________________________ Master Page # 140 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 MEMORANDUM To: HU Executive Team From: Wes Kelley, President/CEO Date: November 8, 2019 Subject: FY20 Executive Goal Plans The following is a list of important projects and initiatives underway or soon to begin. These items are included in individual goal plans, but to encourage good communication and interaction, I’m sharing this combined list for the Executive Team. Customer Care FY20 Goal Plan         Update departmental organizational structure Integrate AMI into standard practices Update HU website and mobile app Coordinate IGSA communications with Redstone Arsenal Manage commercial rate and service issues Expand the New Homes program to the City of Huntsville and validate the effectiveness of the eScore program Update and strengthen HU brand Market and solicit participation in Project Share and Round Up Employee Engagement FY20 Goal Plan        Direct the implementation of an updated employee survey Complete updates to personnel and safety-related policies, standards, and procedures Encourage internal communication through meetings and site visits Define a job matrix charting progression opportunity for HU job descriptions Identify gaps and weaknesses in employee training Develop Security Comm Center and implement security system conversion Ensure completion of needed facility preventative maintenance ________________________________________________________________________________ Master Page # 141 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 FY20 Executive Goal Plans November 8, 2019 Page 2 Engineering FY20 Goal Plan         Update Engineering-related policy, standards, and procedures Address incremental expansion of the fiber network Integrate AMI into HU standard practices Research and evaluate GIS platform improvements Strengthen GIS data collection and validation Advance pole attachment application and administrative processes Improve project and work-order based data analysis Develop informational material explaining development process and requirements Finance FY20 Goal Plan        Establish and administer OPEB investment program Encourage efforts that increase Electric cash balances Evaluate HU's rate competitiveness and affordability Work closely with Engineering to improve capital cost reporting Work closely with Engineering to update ATC and development fees Work with Operations to determine appropriate inventory levels Evaluate improved mechanisms for vehicle budgeting and purchases Information Technology FY20 Goal Plan         Assess SAP S4/HANA conversion benefits and challenges Update HU website and mobile app Work with Engineering to integrate AMI into standard change control processes Provide Internal Audit needed data analysis access Define data governance roles and responsibilities Implement improved help desk ticketing system Implement department reorganization to remove silos, strengthen communication, and increase accountability Review HU telecommunication expenses ________________________________________________________________________________ Master Page # 142 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019 FY20 Executive Goal Plans November 8, 2019 Page 3 Legal FY20 Goal Plan       Develop a consistent means of conducting risk analysis and handling litigation Direct incorporation review under PA 175 of 1951 Define consistent practice for reviewing and storing contracts Establish standards for document retention Support development of Google Fiber contract amendment Ensure legal compliance for pole attachment and small cell administration Operation FY20 Goal Plan        Conduct regular site visits with Operations crews and facilities Direct fiber network completion and establish ongoing operational practices Coordinate potential Redstone Arsenal IGSA engagement Facilitate OMS and Ops Center planning efforts Coordinate with Engineering to strengthen GIS data Ensure gas installations are completed in a timely manner Work with Engineering to incorporate Limestone County water assets into HU's water distribution system ________________________________________________________________________________ Master Page # 143 of 143 - Huntsville Utilities Electric Board Meeting 11/20/2019