Minutes

Minutes of the 811th Meeting

 

NEBRASKA POWER REVIEW BOARD

Minutes of the 811th Meeting

June 8, 2020

 

The 811th meeting of the Nebraska Power Review Board (“the Board” or “PRB”) was held via Webex in accordance with the health restrictions due to the COVID-19 pandemic, and pursuant to Executive Orders 20-03 and 20-24.  The roll was called at 9:02 a.m. and present were Chairman Reida, Vice Chairman Hutchison, Mr. Grennan, Ms. Hilyard, and Mr. Moen.  Executive Director Texel stated that the public notice for the meeting had been published in the Lincoln Journal Star newspaper on June 1, 2020.  All background materials for the agenda items to be acted on were provided to all Board members prior to the meeting.  A copy of the materials was available to the public on the Webex document list.  Instructions to join the meeting via Webex or by telephone only was provided in the public notice and on the meeting agenda available on the Board’s website.

 

The Board first considered the draft minutes from its May 11, 2020, meeting.  The staff did not have any recommended changes and no one had contacted the staff to request any.  Mr. Grennan moved to approve the minutes for the May 11, 2020 meeting.  Mr. Moen seconded the motion.  Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison – yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0.

 

The next agenda item was acceptance of the expense report for the month of May.  In May there was $23,625.83 in personal services, $17,955.78 in operating expenses, and $108 in travel expenses.  The total expenses for May were $41,689.61.  The lodging expense was from Ms. Hilyard’s hotel stay for the March meeting.  Executive Director Texel stated that the fiscal year is 92% complete at the end of May and 87% of the cash fund has been used.  Mr. Moen moved to accept the May expense report.  Mr. Grennan seconded the motion.  Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison – yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0.

 

The next item on the agenda was to consider SAA 310-20-A and SAA 57-20-A.  This is a joint application to amend retail service area agreements 310 and 57 filed by the Nebraska Public Power District, the Dawson Public Power District, and the City of Kearney.  The application was filed on May 20, 2020.  Both service area numbers are actually between NPPD and Dawson PPD.  SAA 310 is between NPPD and Dawson PPD and SAA 57 was formerly between Dawson PPD and Platte Valley PPD.  Platte Valley PPD became part of NPPD in 1970.  NPPD serves Kearney at retail and holds the service area rights to the City.  NPPD therefore operates as the municipal electric provider in Kearney for service area transfer purposes.  The City of Kearney is not an actual party to the service area agreement, but it is the PRB’s practice to allow a city to participate in a joint application to amend a service area that affects that city.  In 2019 Kearney annexed territory on the north edge of the City.  NPPD and Kearney would like to incorporate that territory into NPPD’s service area for Kearney.  The development is known as Arbor View First.  Exhibit A is a map that shows the location of the annexed territory.  Exhibit B is a metes and bounds description of the territory.  Exhibit C is a copy of the City’s Resolution No. 2019-94 accomplishing the annexation.  Exhibit D is a copy of the City’s resolution No. 2019-126 authorizing the City to join NPPD as a co-applicant on the PRB application to acquire the service area rights.  The annexation occurred on June 25, 2019, which falls within the one-year deadline.  The Board members asked if there was any financial contribution for customers or facilities in the area to be transferred.  Executive Director Texel stated that there was there was no documentation accompanying the application that shows any financial arrangements.  Alan Beiermann, NPPD, Land Management Manager for NPPD, told the Board that there are no current customers or facilities in the area to be transferred.  Vice Chairman Hutchison moved to approve SAA 310-20-A & SAA-57-A as described in the application.  Mr. Grennan seconded the motion.  Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison – yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0. 

 

The next item was to consider approval of an amendment to Board Office Policy 6.  Board Policy 6 covers approval of travel plans and expense reimbursements for Board members.  The issue relates to an informal finding in the State Auditor’s recent report regarding when a Board member should be eligible to have lodging and meals paid when a PRB meeting or other Board-related activity ends early enough for the member to return home at a decent hour.  At the May meeting the executive director had suggested that if a PRB meeting or other event ends by 2:00 p.m. the Board member would need to travel home, or they would not be eligible to be reimbursed for overnight stay expenses without documenting the reason why staying the night was necessary.  Reasons warranting an extra night’s stay even though a meeting ended early in the day might include inclement weather, illness, mechanical failure of the member’s automobile, or other similar scenarios.  The Board had asked the executive director to draft language that a board member would need to travel home if they would be expected to arrive home by a certain hour, determined by the local time at their residence.  Executive Director Texel drafted a new section VI to Board Policy 6 to address this issue.  During the Board’s discussion of this item it was brought up that in the section following the new language, there is a definition of when an expense is “incurred”.  Executive Director Texel told the Board the statute involved (Neb. Rev. Stat. section 81-1174) requires that reimbursement requests be submitted no later than 60 days after the final day on which expenses were incurred.  He had checked with State Accounting and each agency has the discretion to define the term “incurred” to mean when the underlying purchase or transaction takes place, or to mean when the travel status for the applicable travel event ends.  In the current Board Policy 6, “incurred” is defined to mean when the underlying transaction takes place (such as purchasing airline tickets or paying for the first night at a hotel, which is sometimes required).  Chairman Reida asked if it might be better to define the start time as when the travel event ends.  He prefers to keep all his receipts together and submit them all at once, instead of potentially having multiple reimbursement requests based on the same travel event.  Vice Chairman Hutchison agreed.  After discussion of the topic, all Board members agreed they preferred to have the submission deadline begin when the travel event ends.  The Board tabled agenda item 5 relating to Board Office Policy 6 until July’s meeting so both changes could be approved at the same time.  The executive director stated that he would make those changes and have a new draft for the July meeting.

 

The next item on the agenda was the executive director’s report.  The first item was the Southwest Power Pool (SPP) update.  Mr. Grennan gave an update on what is happening at the Regional State Committee (RSC).  Mr. Grennan talked about a HITT conference call on June 1.  RSC plans to vote on a white paper examining the Highway-Byway Cost Allocation Review Process at its meeting at the end of July.  The SPP Board of Directors will also vote on it.  The new plan is to allow exceptions to the normal highway-byway payment rules if a line operates as a highway, even though the voltage is under 300 kV.  The situation driving this is a few utilities’ customers are being required to pay for a great deal of transmission needed to move wind power out of their footprint.  The utility does not need the wind energy, though, so the local area receives little benefit from the transmission, but incurs high costs.  In another development, the SPP Board of Directors hired a consultant to create a long-term strategic plan.  SPP will send a survey to RSC members for input. The seams committee is meeting and moving forward.  There is a call scheduled for later today to discuss Seams issues with MISO.  Joe Lang, Director of Energy Regulatory Affairs with OPPD, commented on Mr. Grennan’s information and thanked him for all his work as the PRB’s representative and as RSC chairman.

 

The next item on the agenda was a briefing on the LSP Transmission Holdings, LLC v. Sieben, et al. Case No. 18-2559 decision.  This case was before the U.S. Court of Appeals for the 8th Circuit.  Executive Director Texel prepared a brief summarizing the decision.  He said if anyone would like a copy to let him know.  In the decision, the 8th Circuit upheld Minnesota’s right of first refusal statute.  He wanted to update the Board on this case due to the fact Nebraska, like Minnesota, has a right of first refusal statute.  Nebraska also is in the 8th Circuit, so this decision is binding precedent in Federal court.  In the case, LSP Transmission Holdings, LLC challenged the State of Minnesota’s right of first refusal (ROFR) statute.  The statute gives the incumbent utility in Minnesota the right to build a transmission line if it chooses to do so.  The 8th Circuit affirmed the Minnesota Federal district court’s decision dismissing LSP’s challenge.  LSP Transmission Holdings claimed the statue violated the U.S. Constitution’s dormant Commerce Clause.  The 8th Circuit found Minnesota’s ROFR draws a neutral distinction between existing electric transmission owners whose facilities will connect to a new line and all other entities, regardless of whether they are in-state or out-of-state entities.  The Court pointed out Minnesota’s incumbent transmission owners include entities from not just Minnesota, but also Iowa, North Dakota, South Dakota and Wisconsin.  The Court found the purpose of the ROFR was to maintain a regulatory system that has historically worked to provide Minnesota’s residents with adequate and reliable electric service at reasonable rates.  The Court also found the ROFR did not have a discriminatory effect.  Any entity, whether from Minnesota or out of state, faces the same hurdle under the ROFR.  If the incumbent chooses not to build the line, all other entities have an equal chance to construct the line.  The court also engaged in a test to determine whether a statute imposes an impermissible burden on commerce that is excessive in relation to the putative local benefits.  The test was created under U.S. Supreme court’s decision in Pike v. Bruce Church, Inc. in 1970.  The 8th Circuit concluded the record did not support a finding that even if all states were to enact a ROFR, competition in the market place would be eliminated, as incumbent transmission owners are not required to exercise their right of first refusal.

 

The next item on the agenda was to consider whether the Board would authorize reimbursing the Board’s attorney member and its general counsel the cost to attend a webinar sponsored by the Nebraska State Bar Association (NSBA) on June 11.  The webinar is titled “Best Practices in Administrative Hearings”.  The cost is $50 to attend for NSBA members and $65 for non-members.  The executive director has already paid his cost to attend.  If Chairman Reida wishes to attend, it would be $65.  The subject of the webinar will include hearing presentations, discovery, prehearing negotiations, other prehearing considerations, representation at the hearing, evidence submission, objections and post hearing concerns.  The material seems related to the PRB’s hearings.  Vice Chairman Hutchison move to approve reimbursement of the cost for both the Board’s attorney member and the executive director and general counsel to attend the webinar.  Mr. Moen seconded the motion.  Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison – yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0. 

 

The next item on the agenda was to consider whether the Board would give a pay raise to the executive director and general counsel similar to what will be received by other State employees.  Last Thursday the PRB received notice that all eligible rules-covered Nebraska State employees will receive a 2.3% pay raise effective July 1, 2020, if the employee has at least a “satisfactory” performance evaluation.  Ms. Hallgren, the Board’s business manager, is a rules-covered employee and will receive the 2.3% raise.  Ms. Birkett, the Board’s paralegal, is covered by the State Employee’s Bargaining unit.  All union employee will receive a 2% pay increase, and if they have a “satisfactory” or above performance evaluation they will receive an additional .3%.  Ms. Birkett will be receiving the full 2.3% raise on July 1.  The executive director’s pay is left to the discretion of the Board.  The Legislature appropriated funding for all three PRB employees to receive a 2.3% pay increase.  Chairman Reida recommended the executive director and general counsel receive a 2.3% pay increase effective July 1, 2020.  Ms. Hilyard seconded the motion. Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison – yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0. 

 

The executive director then updated the Board on a proposed application that the Omaha Public Power District plans to submit.  OPPD’s plan previously was to submit the application in time for the July meeting.  However, OPPD informed the executive director that the district now plans to submit the application in July and request a hearing date in conjunction with the Board’s August 10 public meeting.

 

The next meetings will be July 13, August 10, and September 14.  Executive Director Texel explained that the next meeting will be conducted in-person except for Ms. Hilyard, who will need to participate by video conference.  The Governor has stated that Executive Order 20-03, waiving parts of the Open Meetings Act, will not be extended again.  Ms. Hilyard will need be in public space where any member of the public can attend.  Ms. Hilyard plans to utilize the City of Scottsbluff’s City Council chambers room.  The Board will need to provide her with the materials for the public to view just like when we have our meetings in the first floor hearing room.

 

Chairman Reida asked if the Sheldon-Monolith facility was operational yet.  Executive Director Texel was not sure, but did not believe so.  He thought that it would be very interesting if the Board could tour the facility once it is operational.  The executive director will contact NPPD and see about making arrangements.

 

Vice Chairman Hutchison moved to adjourn the meeting.  Mr. Grennan seconded the motion.  Voting on the motion:  Chairman Reida – yes, Vice Chairman Hutchison –yes, Mr. Grennan – yes, Ms. Hilyard – yes, and Mr. Moen – yes.  The motion carried 5 – 0.  The meeting was adjourned at 10:56 a.m.

 

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Timothy J. Texel

Executive Director and General Counsel