Your PUD
News Release
PUD continues cost-cutting as financial outlook worsens
Chelan County PUD
News Release
3/16/2009
Senior managers outlined more cost-saving steps Monday, including a mandatory five days off without pay for most employees, as PUD financial forecasts show continuing declines in wholesale power sales revenues and other key measurements for 2009.
John Janney, chief financial and risk officer, said weather has added to the strain on the PUD’s 2009 budget, even as the District has already cut $26 million from spending for the year. A cold snap in January pushed demand up by 23 average megawatts, and low water flows this month and next will likely require the PUD to buy power to serve local load.
He noted that Bonneville Power Administration, which supplies power from federal dams to many Northwest utilities, sent a letter last week noting “the unusual combination of low water and low prices.”
PUD forecasts for 2009 wholesale power revenues have dropped from $51.4 million last fall to $29.7 million. The PUD is facing a utility services negative change in net assets (bottom line loss) of about $20 million.
Three programs to trim payroll costs were also discussed: the mandatory five-day furlough and two voluntary plans. Randy Stedman, Human Resources executive manager, said the programs came from employee suggestions.
“Every dollar saved here is a dollar we don’t have to look for through involuntary means,” Stedman said.
The PUD expects to save about $940,000 by requiring all full- and part-time employees, union and salaried, to take five days off without pay sometime before Dec. 20, 2009. Stedman said that includes all senior managers and General Manager Rich Riazzi. The days off can be scheduled one at a time.
Commissioners approved a new “Double Yes” program which allows full- and part-time employees, bargaining unit and non-bargaining unit, to propose that their job be eliminated by explaining how the work can be done without them. If senior managers agree, employees will receive a year’s pay when they leave the District.
Stedman emphasized applications are voluntary. There are no targets for how many jobs might be eliminated. Savings won’t be known until applications are reviewed and approved.
A third program allows full-time employees to propose working part-time.
Board delays putting new electric rates in place
Commissioners decided Monday to delay putting new electric rates into effect by up to 60 days. New rates for water and sewer customers approved last October will begin April 1 as planned.
The new rate structure is designed to encourage power and water conservation and more closely align rates among different types of customers. The cost per kilowatt hour (kWh) will be slightly lower for residential customers using moderate amounts of power, and rates will be higher for power use that tops 3,000 kWh a month.
General Manager Rich Riazzi said more time is needed to consider how a possible recommendation for an electric rate surcharge would affect customers under the new rate design. Consideration of an electric rates surcharge has been mentioned as a last resort as the PUD faces continuing financial pressures from low runoff forecasts, low wholesale power prices and lower interest income on investments.
Rocky Reach Dam license accepted; rehearing sought on some terms
There was applause Monday as PUD commissioners accepted the new 43-year federal license for Rocky Reach Dam received on Feb. 19. Commissioners also asked the Federal Energy Regulatory Commission to reconsider several terms including the length of the license.
The PUD asked for a 50-year license, a request supported by the agencies, tribes and communities involved in the relicensing effort. The other issues involve wildlife habitat and endangered plants and a request to lease or sell land just north of the project boundary to the city of Entiat.
In other business, commissioners:
- Heard that a bill to protect Chelan County PUD from liability related to potential whitewater boating accidents in the Chelan Gorge failed to pass the state Senate. There is a possibility it could still be added to other legislation, or it will be reintroduced at the start of the 2010 legislative session.
- Canceled the March 30 board meeting as it would be a fifth meeting in a month.
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General Manager Rich Riazzi will provide an update on the PUD’s financial condition at a community at a special board meeting at 5:30 tonight at the Confluence Technology Center, 285 Technology Way in Wenatchee.
The next regular commission meeting is at 11 a.m. on Monday, March 23, 2009, in the PUD boardroom at 327 N. Wenatchee Ave.
Most PUD commission meetings are recorded, and a link to the audio is available on the PUD’s home page at www.chelanpud.org.
Kimberlee Craig
Public Information Officer
509-661-4320, direct line
509-679-6858, cell
kimberlee.craig@chelanpud.org