Utility Commissioners get down to business
Just one week after being elected, the Block Island Utility District Board of Commissioners held its first meeting and got down to work. Out of a field of eight, the five candidates elected to the board were Barbara MacMullan, Jack Savoie, Bill Penn, Everett Shorey, and Mary Jane Balser.
The first step the Commissioners took was to elect officers. MacMullan expressed the wish that she would like to serve as chair, and was duly nominated and approved by all. Savoie was elected as Vice Chair, and Penn elected Treasurer.
When it came to the position of secretary, MacMullan asked: “Who wants to be secretary?” She said that since the Utility Board had no clerk, the secretary would be responsible for posting the meetings and agendas with the R.I. Secretary of State’s office, and preparing minutes. For the initial meeting, MacMullan said she had done the posting after studying how to do so and establishing an account with the Secretary of State’s system.
After some discussion, Shorey volunteered to take on the position and, after he was elected, promptly got out some paper to take notes, something he said he was not used to doing.
Given that the duties of secretary are complex, and since she had already learned how to post the meetings, MacMullan said she would continue to perform that task for the time being. Balser also volunteered to assist by posting meeting notices at the Block Island Grocery and passing on the notices to the Post Office.
Block Island Power Company President Jeffery Wright, who attended the meeting, said he would also post the meeting notices on BIPCo’s Facebook page.
While the Commissioners would like to hire a clerk, for now they cannot as they have no start-up money. This became a sticking point in initiating other actions as well. Members, although willing, deemed it inappropriate to donate, or lend money to the Utility District, even for the rental of a Post Office box. According to the Utility District’s enabling legislation, Commissioners are to receive no compensation, which extends to reimbursements for such things as travel and training.
Of great concern was the acquisition of the type of liability insurance called “D and O” insurance which covers directors and officers of a corporation for liability and “errors and omissions.”
While certain services, such as obtaining legal advice, might be obtained without an upfront payment, Shorey felt this would most certainly not be the case in obtaining insurance.
There are two financial institutions that have expressed interest in working with the new Utility District according to Wright, and they are willing to send out representatives to the island to discuss options with the Commissioners. One is CoBank, which provided BIPCo with a line of credit to finance its tank removal and replacement project. The other is the Cooperative Finance Corporation, which provides “electric cooperative borrowers with the financial tools they need to succeed in an increasingly complex industry,” according to literature it puts out, even though the B.I. Utility District is not a cooperative.
Balser said she thought there might be some grant money available as seed money, specifically with the USDA. She said the USDA has provided her business with grants in the past, and volunteered to make some phone calls.
“I would prefer to get a grant if it’s available,” said Penn.
“Five to 10 grand would be a big help,” said Shorey.
In order to proceed with IRS filings to obtain tax-exempt status at the federal level, the Commissioners will need some legal assistance. They cannot utilize the services of Kathy Merolla, as she has been working with the BIPCo Board and will continue to represent them in the matter of negotiating with the Utility District in the acquisition of the assets and liabilities of BIPCo.
Shorey expressed an interest in retaining Partridge, Snow and Hahn, the firm that provided advice to the BIPCo Transition Team, on which Shorey, MacMullan, Savoie, and Penn had all served. The Transition Team however was a town appointed board, and the town footed the bill for the services. To avoid any conflict, Shorey said a release letter would need to be issued by the town, and he would work with New Shoreham Finance Director Amy Land in obtaining one.
Crafting bylaws is another initial task for the Commissioners. They have obtained at least four sets of bylaws from other utilities that will be used as models. “They’re all pretty much the same,” said MacMullan.
Balser said: “It’s all in the legislation,” regarding what the bylaws should reflect. “It’s pretty much boilerplate — it’s rearranging the verbiage.”
“Can I offer my thoughts on bylaws?” asked Wright. “The most important thing is having a provision for modifying the bylaws.” Another provision he suggested was to include a mechanism for replacing someone if “they go off the reservation.”
A subcommittee consisting of Penn and MacMullan was established to draft bylaws based on the legislation and existing models.
The next meetings of the Board of Utility Commissioners will be on Friday, Nov. 17. The first meeting will have a single agenda item — the acquisition of BIPCo, which entails buying the two-thirds ownership of the town, and the one third ownership of Sara McGinnes. It will be in closed. A location has not been set. The second meeting, scheduled for 10:15 a.m. at Town Hall will be to hear from the representatives from CoBank.
A meeting with CFC representatives will follow at a later date.