MINUTES
Executive Committee of the
Clean Power Alliance of Southern California
Regular Meeting
Thursday, May 16, 2024
1:30 p.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:
Agoura Hills City Hall
Planning Conference Room
30001 Ladyface Court
Agoura Hills, CA 91301
Clean Power Alliance Office
Executive Conference Room
801 S. Grand Ave., Suite 400
Los Angeles, CA 90017
Beverly Hills City Hall
Council Office, 4th Floor
455 N. Rexford Drive
Beverly Hills, 90210
Camarillo City Hall
Office of the Mayor
601 Carmen Drive
Camarillo, CA 93010
Ventura County Government Center
Point Mugu Room, 4th Floor
Hall of Administration
800 South Victoria Avenue
Ventura, CA 93009
Sierra Madre City Hall
Council Chambers
232 W. Sierra Madre Blvd.
Sierra Madre, CA 91024
Los Angeles County Hall of Administration
Sybil Brand Conference Room, Room 372
500 West Temple Street
Los Angeles, CA 90012
Ojai City Hall
Conference Room
401 S Ventura St.
Ojai, CA 93023
Renaissance Esmeralda Hotel
44-400 Indian Wells Lane
Indian Wells, CA 92210
Hawthorne City Hall
Administrative Office
4455 W. 126th Street
Hawthorne, CA 90250
CALL TO ORDER & ROLL CALL
Chair Klein Lopez called the meeting to order at 1:30 p.m. and Gabriela Monzon, Clerk of the Board, conducted roll call.
Roll Call
Agoura Hills Deborah Klein Lopez Chair Remote
Beverly Hills Julian Gold Immediate Past Chair Remote
Camarillo Susan Santangelo Committee Member Remote
Carson Cedric Hicks Committee Member Remote
Hawthorne Alex Monteiro Committee Member Remote
Los Angeles County Lindsey Horvath Vice Chair Remote
Ojai Betsy Stix Committee Member Absent
Sierra Madre Robert Parkhurst Committee Member Absent
Ventura County Vianey Lopez Vice Chair Remote
All votes are unanimous unless otherwise stated.
GENERAL PUBLIC COMMENT
There was no public comment.
CLOSED SESSION
1. CONFERENCE WITH LEGAL COUNSEL – ANTICIPATED LITIGATION Significant exposure to litigation pursuant to paragraph (2) of subdivision (d) of Section 54956.9: 2
Nancy Whang, General Counsel, stated that no reportable action was taken.
CONSENT AGENDA
2. Approve Minutes from April 18, 2024, Executive Committee Meeting Motion: Committee Member Hicks, Carson
Second: Vice Chair Horvath, Los Angeles County
Vote: The consent agenda was approved by a roll call vote.
REGULAR AGENDA
3. Review Draft Agenda for the June 6, 2024, Board of Directors Meeting Ted Bardacke, Chief Executive Officer, provided a brief overview of Consent and Regular agenda items for Board approval at its next meeting.
4. Receive Presentation on FY 2024-25 Draft Budget
David McNeil, Chief Financial Officer, presented a summary of the proposed budget. Budgeted revenues are projected to be flat year-over-year. Budget cost of energy is up by 12% reflecting increased costs of Resource Adequacy and Renewable Energy. The budgeted increase in the net position of $133.3 million is 53% lower than the prior year but will still bring CPA’s reserve percentage to 40% by June 2025, which is the mid-point of the target range in the Reserve Policy. Mr.
McNeil presented details of net energy revenue that reflect the rate approach approved by the Board. The 21% increase in operating expenses reflects investments in customer programs, marketing and communications, staffing, and administrative expenses. Days liquidity on hand (DLOH) would increase to approximately 150 days consistent with the Reserve Policy target. Mr. McNeil summarized his presentation, stating that revenues are budgeted at $1.58 billion, costs of energy are budgeted at $1.39 billion, and operating costs are budgeted at $67.5 million. CPA’s financial metrics continue to compare favorably with peer CCAs.
Committee Member Gold asked for details about bad debt; staff responded that the actual bad debt over the last 12 months has been 1.9% of revenues and that was used for projections for next year’s budget. Residential customers compose a large portion of the bad debt resulting from SCE’s slow collection efforts and the economic impact of the pandemic. Responding to Committee Member Gold’s question about recourse for the collection of bad debt, Nancy Whang, General Counsel, added that more research is necessary to better understand CPA’s options relating to bad debt collection; the process and SCE’s designation as CPA’s collector is dictated by tariffs.
Vice Chair Horvath acknowledged CPA’s healthy cash flow; cautioned staff to monitor the correlation between revenues and increase in expenses; expressed support for funding towards marketing and customer programs. In response to Vice Chair Horvath’s question about the credit rating, Mr. McNeil noted that CPA is in good standing in the market and that entities are now approaching CPA wanting to do business because of its strong credit rating. Committee Member Hicks asked how pandemic relief funds affected CPA’s bad debt, and if it would help to lobby legislators to take action. Staff noted that CPA did receive funds twice for some of its customer past due balances, but there is still a significant amount of bad debt left; while there was some interest in another round of pandemic relief funding, the current state budget deficit put an end to that possibility. To Chair Klein Lopez’s question about the normal percentage of bad debt pre-pandemic, staff responded that it was about 0.5%, and noted that as electricity prices increase, there may be a greater number of delinquent accounts, but that pre-pandemic benchmark has been relatively accurate with other CCAs.
5. Oral Update from the CEO on CPA Operations
Mr. Bardacke focused on the agenda for the CPA Board Retreat scheduled for June 21, 2024. The retreat will include three sessions to educate Board members on community programs, discuss expansion priorities, and other operational topics.
The Committee suggested ice breakers, name recognition brainstorming, and expressed excitement about the community programs session.
COMMITTEE MEMBER COMMENTS
Chair Klein Lopez announced that Vice Chair Horvath will run the June 6, 2024, Board meeting.
ADJOURN
Chair Klein Lopez adjourned the meeting at 3:07 p.m.