MINUTES
Finance Committee of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, January 11, 2024, 11:00 a.m.
Meeting videos are available on CPA's YouTube Channel.
http://www.youtube.com/@CPApublicmeetings
Committee members participated in this meeting from the following locations:
Camarillo City Hall
Mayor’s Office
601 Carmen Drive
Camarillo, CA 93010
Clean Power Alliance
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Claremont City Hall
Conference Room
207 Harvard Avenue
Claremont, CA 91711
Carson City Hall
Executive Conference Room
701 East Carson Street
Carson, CA 90745
Rolling Hills Estates City Hall
Conference Room
4045 Palos Verdes Drive North
Rolling Hills Estates, CA 90274
Thousand Oaks City Hall
City Manager’s Office, Council Office #1
2100 Thousand Oaks Blvd.
Thousand Oaks, CA 91362
CALL TO ORDER & ROLL CALL
Committee Chair Santangelo called the meeting to order at 11:00 a.m. and Gladys Campos, Deputy Clerk of the Board, conducted roll call.
Roll Call
Camarillo
Susan
Santangelo Committee Chair Remote
Carson Reata Kulcsar Committee Member Remote
Claremont Corey Calaycay Committee Member Remote
Rolling Hills Estates Steve Zuckerman Committee Member Remote Santa Monica Pam O’Connor Committee Member Present
Thousand Oaks David Newman Committee Member Remote
All votes are unanimous unless otherwise stated.
GENERAL PUBLIC COMMENT
There was no public comment.
CONSENT AGENDA
1. Approve Minutes from the November 28, 2023, Finance Committee Meeting
2. Receive and File November and December 2023 Risk Management Team Report
3. Receive and File November 2023 CPA Investment Report
4. Receive and File October 2023 Financial Dashboard
Motion: Committee Member O’Connor, Santa Monica
Second: Committee Member Kulcsar, Carson
Vote: The consent agenda was approved by a roll call vote.
REGULAR AGENDA
5. Report from the Chief Financial Officer
David McNeil, Chief Financial Officer, reported a gain of $6 million in October 2023.
Financial results were below budget primarily due to a one-time charge related to renewable electricity acquired from Southern California Edison (SCE). Mr. McNeil noted that certificates of deposits (CDs) were purchased to take advantage of higher interest rates in November. Mr. McNeil noted that due to a backlog of past due residential accounts, SCE collection activities have been slower than expected. Mr. McNeil concluded with a summary of CPA’s banking relationships.
Committee Member Zuckerman asked questions regarding the purchase of renewable energy from SCE. In response, Mr. McNeil noted that CPA purchased renewable energy from SCE through long-term contracts via that Voluntary Allocation Market Offer Process (VAMO) at a price that fluctuates each year based on market prices. In response to Committee Member Kulcsar’s questions about investments, Mr. McNeil explained that CPA began investing in CDs in November 2023; LAIF is the only other current investment partner. Mr. Bardacke clarified that the CDs were purchased from River City Bank, with which CPA has a depository relationship.
6. A. Direct Staff to Negotiate a Two-Year Extension and Amendment of its Credit Agreement with JPMorgan and B. Recommend to the Board of Directors the Approval of an Extension and Amendment of its Credit Agreement with JPMorgan Kate Freeman, Strategic Finance Manager, provided a presentation on the item.
The current credit agreement is set to expire on March 31, 2024. Ms. Freeman reviewed the advantages of maintaining a credit facility and provided a comparison between the two banks that submitted proposals, JPMorgan Chase Bank (JPM) and Royal Bank of Canada (RBC). Staff recommends moving forward with JPMorgan’s proposed agreement, which offers more savings than the current agreement and compares favorably with lines of credit provided to other CCAs.
In response to Committee Member Kulcsar’s question about any new contract language terms, Ms. Freeman explained that new contract language relates to the fee reduction, the extension of the term, and debt service compliance covenant.
Committee Member Newman asked about any advantage to being rated by both credit rating agencies, S&P and Moody’s; Mr. McNeil clarified there was no advantage.
Motion: Committee Member Newman, Thousand Oaks
Second: Committee Member Zuckerman, Rolling Hills Estates Vote: Item 6 was approved by a roll call vote.
7. Recommend to the Board of Directors that Staff be Authorized to Invest CPA Funds in the California Asset Management Program
David McNeil, Chief Financial Officer, presented the CAMP Investment Proposal.
Mr. McNeil summarized CPA’s current investments. CPA is looking for opportunities to invest at higher rates due to reaching the 30% cap in CDs. Mr.
McNeil described CAMP’s investment pools as having low risk and high-quality financial securities, flexibility to move money, and better returns. There are two methods of investing in CAMP, either as a member of the JPA or as an investor; staff will consult with the Executive Committee to determine the manner in which CPA should invest in CAMP. However, staff requests that the committee recommend to the Board that CPA invest funds in CAMP.
The Committee supported the investment.
Motion: Committee Member Calaycay, Claremont
Second: Committee Member Zuckerman, Rolling Hills Estates Vote: Item 7 was approved by a roll call vote.
COMMITTEE MEMBER COMMENTS
None.
ADJOURN
Committee Chair Santangelo adjourned the meeting at 11:36 a.m.