Regular Board Meeting
June 30, 2022
Item 6: Consider Approval of
Agreement with Burke, Williams,
Sorensen, LLP for General
Counsel Services
6/30/22 2
Item 6: General Counsel Agreement
• Recommendation:
• Approve agreement with Burke, Williams & Sorensen, LLP to provide General Counsel for an annual not to exceed $120,000, beginning July 1, 2022 and authorize the Chief Executive Officer to execute all documents subject to General Counsel approval. 6/30/22 3
Item 6: General Counsel Agreement
• Recommendation:
• Approve agreement with Burke, Williams & Sorensen, LLP to provide General Counsel for an annual not to exceed $120,000, beginning July 1, 2022 and authorize the Chief Executive Officer to execute all documents subject to General Counsel approval. 6/30/22 4
Item 6: General Counsel Agreement
• Background:
• March 31, 2022 – CEA Board Directed RFQ for General Counsel Services
• April 18, 2022 – RFQ issued
• Posted to CEA Website
• Sent directly to nine firms
• April 21, 2022 – Ad Hoc Subcommitte Appointed
• Vice Chair Druker
• Board Member Acosta
• May 16, 2022 – Responses Due
• 4 Responses Received
6/30/22 5
Item 6: General Counsel Agreement
• Responses:
• Burke, Williams & Sorensen, LLP
• Duncan, Weinberg, Genzer & Pembroke
• Procopio
• Richards, Watson, Gershon
• Subcommittee reviewed responses, selected Burke,
Williams & Sorensen, Procopio & Richards, Watson, Gershon to interview
• Subcommittee selected Burke, Williams & Sorensen to meet with full Board – June 23, 2022 Closed Session
6/30/22 6
Item 6: General Counsel Agreement
• Burke, Williams & Sorensen, LLP
• Founded 1927
• Over 130 Attorneys on staff
• Specialties
• Public entity administration and municipal law
• land use environment law
• Public sector labor and Employment law
• Office in San Diego to support CEA
• Johanna Canlas, Lead Attorney
• Elizabeth Mitchell, Assistant Lead Attorney
• Gena Burns, Public Sector Labor and Employment Attorney 6/30/22 7
Questions/Discussion
6/30/22 8
Item 7: CEO & Regulatory Report
6/30/22 9
Item 7: CEO Report
• CEA Expansion
• Escondido & San Marcos – April 2023 Launch
• Timeline:
• Implementation Plan Amendment Certified by CPUC – RECEIVED! • April 2022 – Include energy usage in CEA Year Ahead Resource Adequacy(RA) Filing with CPUC – First Procurement Related Action - FILED • May 2022 – Energy Hedge Procurement Begins
• July 2022 – RA requirements received from CPUC – Procurement Obligations • August 2022 – CAC Input into marketing and outreach strategy • October 2022 – Contracts for RA finalized; submittal to CPUC • October 2022 – Marketing & Outreach Begins
• February 2023 – Required Noticing begins
• April 2023 – Service Enrollments
6/30/22 10
Item 8: CEO Report
• CEA Expansion
• Oceanside, Vista, San Clemente – 2024 service
• Timeline:
• April 2022 – Results to cities
• May 2022
• May 3 - Vista Council Workshop
• May 26 – CEA Board Update
• June 2022 - Cities consider resolution to join CEA and Ordinance establishing CCA • June 8 & 22 – Oceanside City Council Approved Resolution to Join CEA and Ordinance • June 28 – Vista City Council
• July 2022
• July 12 – San Clemente Community workshop
• July 19 – San Clemente City Council consider resolution to join CEA and Ordinance establishing CCA • July 28 - CEA approve cities joining; direct preparation of Implementation Plan Amendment • August 2022 – New Board Members Oath of Office
• October 2022 – Draft Implementation Plan Amendment to CEA Board for approval • December 2022 – File Implementation Plan Amendment with CPUC 6/30/22 11
Questions/Discussion
6/30/22 12
Item 8: Consider Resolution 2022-
003 Approving FY 2022/23
Budget
6/30/22 13
Item 8: Proposed FY 2022/23 Budget
• Recommendation:
• Adopt Resolution 202—003 approving FY 2022/23 Budget. 6/30/22 14
Item 8: Proposed FY 2022/23 Budget
• FY 22/23 Proposed Budget Assumptions
• Revenues based on current adopted rates
• Power supply costs based on actual executed contracts and May forward price curve
• Consulting Services based on approved contracts
• Priorities & Goals
• Financial Stability
• Regulatory Compliance
• Successful Expansion in Escondido and San Marcos
6/30/22 15
Item 8: Proposed FY 2022/23 Budget
• May 26, 2022
• Board reviewed Proposed FY 2022/23 & provided direction • Staff revised Proposed Budget based on Board direction 6/30/22 16
Initial Proposed FY
22/23 Budget
Updated Proposed
FY 22/23 Budget Variance
Projected Revenue $80,791,405 $80,791,405 $0
Projected Expenditures $78,383,015 $76,745,240 ($1,637,775) Net Results $2,408,390 $4,046,165 $1,637,775
Item 8: Proposed FY 2022/23 Budget
6/30/22 17
Initial Proposed
FY 22/23
Budget
Updated
Proposed FY
22/23 Budget
Notes
Power Supply $74,134,855 $73,000,000
Reduction based on FY 21/22
actuals compared to forward price
curves
Staffing/Consultants $985,280 $529,360
Reduction based on maintaining
Interim CFO and Interim Secretary
and partial year funding of
remaining new positions
Legal Services $390,000 $335,000
Reduction based on year-to-date
FY 21/22 Actuals
Professional Services $963,600 $981,600
Increase for funding of contract
Interim CFO
Audit Services $15,000 $10,000
Reduction based on year-to-date
FY 21/22 Actuals
Insurance $35,000 $30,000
Reduction based on year-to-date
FY 21/22 Actuals
Item 8: Proposed FY 2022/23 Budget
• Proposed New Positions
• Accounts Services/Program Manager
• Procurement Manager
• Regulatory Analyst
6/30/22 18
6/30/22 19
• Balance Budget
• Proposed Budget results in
5% Reserve Contribution
• Meets Reserve Policy
FY 22/23 Proposed
Budget - Summary
REVENUE
Energy Sales Revenue $ 80,786,405
Interest Income $ 5,000
Funds provided by Financing
TOTAL REVENUE $ 80,791,405
EXPENDITURES
Power Supply $ 73,000,000
Data Management/Call Center $ 1,151,180
Staffing/Consultants $ 529,360
Legal Services $ 335,000
Professional Services $ 981,600
Audit Services $ 10,000
Software & Licenses $ 15,100
Memberships & Dues $ 121,000
Printing $ 55,000
Postage $ 50,000
Advertising $ 15,000
Insurance $ 30,000
Bank Fees $ 2,000
Debt Service $ 450,000
TOTAL PROJECTED BUDGET $ 76,745,240
Net Results of Operations $ 4,046,165
Beginning Fund Balance 3,210,940
Ending Fund Balance $ 7,257,105
Item 8: Proposed FY 2022/23 Budget
Questions/Discussion
6/30/22 20
Item 9: Consider Authorization of
Execution of Agreement with Resi
Station, LLC for Resource
Adequacy
6/30/22 21
Item 9: Agreement with Resi Station,
LLC for Resource Adequacy
• Recommendation:
• Authorize Board Chair and Chief Executive Officer to Execute Agreement with Resi Station, LLC for Resource Adequacy for a Ten-Year period with deliveries beginning January 2023, for an amount not to exceed $2.0MM, in compliance with California Public Utilities Commission Mid-Term Reliability Procurement Mandate. 6/30/22 22
• Background:
• CPUC Decision 21-06-035
• Procurement of additional resources for replacement of Diablo Canyon and other requirements
• Project online by 8/1/2023, 6/1/2024 or 6/1/2025 with a preference for earlier date
• Available for minimum 10 years
• Non-fossil fueled
6/30/22 23
Item 9: Agreement with Resi Station,
LLC for Resource Adequacy
• December 2021 Solicitation
• Joint with Desert Community Energy and California Choice Energy Authority
• Responses representing 80 projects
• Short-list based on price, location, and CPUC compliance • Resi Station meets procurement requirements established by CPUC
6/30/22 24
Item 9: Agreement with Resi Station,
LLC for Resource Adequacy
Questions/Discussion
6/30/22 25
Item 10: Consider Authorization of
Execution of Agreement with San
Diego Gas & Electric for Renewable
Energy through Voluntary Allocation
Process
6/30/22 26
Item 10: Agreement with SDG&E for
Renewable Energy
• Recommendation:
• Authorize Board Chair and Chief Executive Officer to Execute Agreement with SDG&E for Renewable Energy through Voluntary Allocation Process and return to Board for Ratification of Agreement.
6/30/22 27
• Background:
• CPUC Decision 21-05-030
• Requires SDG&E to offer voluntary allocations of its renewable energy portfolio to CCAs
• Renewable deliveries to begin January 1, 2023
• Benefits to CEA
• SDG&E allocations are for projects currently online and generating power • Assist CEA to meet Renewable Energy requirements
• Allocations from resources included in Power Charge Indifference Adjustment portfolio – reduce contracts that contribute to PCIA Charge to customers
6/30/22 28
Item 10: Agreement with SDG&E for
Renewable Energy
6/30/22 29
Item 10: Agreement with SDG&E for
Renewable Energy
VOLUNTARY ALLOCATION ACTIVITIES DUE DATES
Meet and Confer(s) Ongoing as needed
LSE notifies SDG&E of its intent to take a
Voluntary Allocation No later than July 1, 2022
Contracting for Voluntary Allocation
commences July 1, 2022
LSE’s notify SDG&E of Voluntary
Allocation Election percentage July 15 – 22, 2022
Deadline for LSE’s to execute and return
Voluntary Allocation Agreement July 29, 2022
Timeline pursuant to CPUC decision
Questions/Discussion
6/30/22 30