Urban Growth & Increased Regulations 1990-1999

Access to inexpensive, clean water and electricity is not available to everyone in the United States, let alone in the Pacific Northwest. Fortunately, from its inception, McMinnville’s leaders thought about the future well-being of area residents, entrepreneurs and industry. Delivering local, clean water and electricity produced in an environmentally friendly manner, at low rates, McMinnville Water and Light set a high standard for its customers. In 1990, utility leaders knew that the approaching twenty-first century would bring an increased population, which meant an expanding infrastructure to accommodate the construction of new neighborhoods and growing business needs. With this in mind, they planned strategically 20 to 50 years in the future, scheduling systems maintenance and forecasting necessary upgrades and expansion needs commensurate with budgets.

“This utility has an incredible foundation and model upon which to continue growth and operations,” said Commissioner Tom Tankersley, who began service on the McMinnville Water and Light Commission in 1990, serving as chair since 1991. “The utility has passed on the inheritance of a vision by those serving it over the years. Staff and the Commission continue to expand that vision to the future.”

Scott Rosenbalm and the Challenges of Utility Maintenance in the 1980s

Scott Rosenbalm began work at McMinnville Water and Light as an apprentice lineman in March 1992. He didn’t know much about the utility at the time, but was soon impressed with the professionalism of staff and the activities it took to keep operations going.

“People take for granted that when you flip the power switch there will be light; when you turn the tap, water will come out of faucet!” commented Rosenbalm. “It takes a lot of work behind the scenes to make that happen.”[i]

The 1980s brought an overall national population increase of 9.8 percent, with Oregon showing only a 7.9 percent increase as compared to the 25.9 percent increase reflected in the 1980 Census. Urban populations nationally and in Oregon reflected a 12 percent increase, while the population in rural areas decreased. Overall, rural populations in the United States declined from 11.1 to 3.6 percent; and Oregon’s rural population fell even further to .7 percent. Historically, population movement from rural to urban centers reflects recessionary events, and in the case of the 1980s, this population shift came about, most likely, from a decline in the timber and agriculture industries. The 1990 Census ranked McMinnville the nineteenth most populated city in Oregon, with a count of 20,324 as compared to 16,051 in 1980. Housing units increased slowly with only 1,446 units built in ten years.[ii]

The 1990s: Growth, Regulatory Changes, and Utility Expansions

Unlike the previous decade of slow growth, the 1990s began with increased population, which brought about greater housing and business construction activity in McMinnville. In early May 1990, Water Superintendent Eric Abrams reported 300 pre-paid subdivision lots on the schedule for the 1990 construction season, launching a busy time for the utility. The opening year of the decade also brought a new trust agreement between BPA and McMinnville Water and Light, which allowed construction of a 230 kV Carlton-Cascade transmission line to serve CSRM’s power load. A short time later, the Commission approved a power contract with Air Liquide Corporation, which served as a supporting arm to CSRM’s need of gaseous oxygen, nitrogen and argon for its electric arc furnace.

In 1990, the McMinnville Water and Light Commission consisted of Mayor Ed Gormley and Commissioners Charles Moore, Sidney “Skip” Huwaldt, Thomas Gunness and Alan Hay. In 1991, O. C. Yocom joined the Commission, replacing Commissioner Charles Moore who departed on June 26 that year. John Harshman still served as the General Manager and Delores Land as Clerk of the Commission. The study of Sidalcea Nelsoniana (Nelson’s Checkermallow) continued in the watershed with experimental germination and other activities relating to the plant. In June 1992, the Commission learned of the plant’s listing as a threatened species.

McMinnville saw the beginning of a trend toward repurposing instead of tearing down old structures beginning in the 1990s. During spring 1991, Electric Superintendent Chuck Kadell and his crew temporarily removed power lines, enabling house moving crews to relocate the historic Michelbook house. Travelling from its former home on Michelbook Lane at the golf course of the same name, the house settled on College Avenue and the Linfield campus, where it began a new purpose as the Office of Admission. Previously, in July 1990, the Commission sold the old Water and Light Diesel Plant property, located at Fifth and Irvine streets, to Panther Creek Cellars for $100,000, giving the building a new purpose and role in the area’s wine making industry. Later, when reviewing its assets in October 1992, the Commission decided to sell two warehouse properties no longer used by the utility. Bobby Michael purchased the properties, located between NE Irvine and Hembree streets and NE 10th and 11th streets, in October 1992, to for $81,000. Today the properties are home to several local businesses.

McMinnville Water and Light began offering its consumers clean electrical energy through the generation and transmission of hydroelectric power in 1889. Since contracting with BPA in 1940, the Water and Light Commission has consistently demonstrated the utility’s energy conservation values through participating in and utilizing such programs as residential weatherization, Energy Smart Design and Super Good Cents. The long-term Super Good Cents (SGC) program began with a survey of utilities, conducted in 1990, that indicated an interest in its continuation. Beginning in April 1992, BPA and customers around the region participated in an intensive effort to develop a flexible and acceptable Long-Term SGC platform, which included Options Programs in Washington and Oregon, as well as an Appliance Efficiency Program. McMinnville Water and Light also joined other public power utilities and communities across the United States in celebrating the benefits of public power during Energy Awareness Month in October 1990, now an annual celebration that takes place nationwide during the second week of October. The week honors public power jurisdictions, customers, policy makers and employees who work together to provide the best possible electric service.

The decade of the nineties brought increased regulation to the power industry. In 1992, Congress passed and President George H. W. Bush enacted the Energy Policy Act (EPAct). The Federal Energy Regulatory Commission (FERC) implemented EPAct, which allowed utilities to compete for consumers inside and outside their service areas with the condition that they provided the same rates and conditions for both. FERC later issued Orders 888 and 889 to private and investor-owned utilities under its regulation. Order 888 required nondiscriminatory access to competitors by transmission-owning utilities. Order 889 required utilities to post availability information on the Internet about their transmission systems referred to as Open-Access Same-time Information Sharing (OASIS). Order 889 also required utilities to separate their transmission and generation operations so that they functioned separately and independent of each other. This requirement prompted utilities to combine transmission resources into regional independent system operators, also known as ISOs. Both orders affected publically owned utilities by requiring reciprocity with regard to nondiscriminatory access to transmission systems.

Another regulation affected the joint use of utility poles. For example, an inventory of utility poles owned by McMinnville Water and Light showed a count of 5,392 poles in July 1992. The utility also shared the use of poles belonging to other entities. Legislation resulted in modified FTC regulations, which required a change from per pole rates to per foot-of-pole-contact rates, which required revised joint use agreements between General Telephone (GTE), TCI Cable Television, PGE and McMinnville Water and Light. It is interesting to note that utility poles generally carry power lines on the upper portion with communication lines below them.[iii]

Conservation Efforts and Water Supply Management

Continuing its watershed conservation efforts, the Commission acquired 360 acres through a combined land purchase and exchange completed in early 1991. In October 1990, McMinnville Water and Light purchased a parcel of land that abutted property already owned by the utility. Next, it purchased property with timber from the Rose Estate at Marcola. After completing that purchase, the utility exchanged the land with Willamette Industries for acreage located 8.5 miles west of the McGuire Reservoir. Finally, the Commission exchanged that acreage for BLM land. The land exchange gave McMinnville Water and Light ownership of the entire McGuire Reservoir shoreline, with BLM retaining rights to harvest timber. The combined acquisitions greatly enhanced the watershed around McGuire Reservoir, allowing for the protection of the quality and quantity of water entering it. Shortly after the completion of the land acquisition, in March 1991, Operations Superintendent Jack Nicholls told the Commission about Congressional activity to designate portions of the Nestucca River watershed as wild and scenic areas. This activity also involved efforts by the State of Oregon to include Walker Creek in the designation, spurred on by Friends of Walker Creek.[iv]

In May, the Commission authorized a timber sale to high-bidder Taylor Lumber and Treating. The timber sale involved pre-commercial thinning in the watershed on approximately 37 acres at 740 Road, cutting an estimated 1.5 million board feet of timber and bringing a return to the utility of approximately $560,000. Timber sales throughout the 1990s brought continued revenue to the utility for use in capital improvement projects. Maintaining its watershed stewardship oversight, the Commission hired contractors, such as Keith Whitehead Reforestation, to plant trees in logged areas, including 50,000 Douglas fir seedlings planted in the Haskins Creek Watershed area during 1993.

In July 1992, McMinnville Water and Light received a severe and continuing drought alert from the Oregon Water Resources Department. The letter ordered cities of more than 10,000 people and some municipal water suppliers to submit a curtailment plan by August 31, 1992. This deadline prompted General Manager Harshman to explain to the Commission that he intended to request a 90-day extension because McMinnville continued to be “in good shape in terms of water supply”. It is worthy to note that during the previous month’s Commission meeting, staff discussed the receipt of low-flow showerheads for customers wishing to participate in a water conservation program. McMinnville Water and Light, cognizant of the need for continued water sourcing and supply of good, clean water for its customers, was always seeking ways to conserve the precious resource. In fact, during the same August Commission meeting, Commissioners learned that staff chose 60 households to participate in a water quality-monitoring program. Staff chose the households based on age and plumbing materials used in construction. The program was a requirement to meet new and enhanced government regulations on lead and copper levels in drinking water. Water Superintendent Abrams reported no known problems with the City’s drinking water. Earlier that spring, staff at the Scott Water Treatment Plant conducted the first trace study and gave the utility “high marks” for water quality.

The Commission set October 20, 1992 as the date for a public hearing about a water rate increase and the elimination of declining block rate steps. Staff noted that the declining block rate steps rewarded commercial consumers using large amounts of water and did nothing to encourage water conservation and wise use. Rates increased ten percent, with water services outside the City limits calculated with a multiplier of two.

Water Rate Schedule
Residential

• Costumer Service Charge $4.60 per month
• Rate per 100 cubic feet $0.397 / 100 cubic feet

General Service

• Customer Service Charge $4.60 per month
• First 5,000 cubic feet $0.397 / 100 cubic feet
• Over 5,000 cubic feet $0.2950/100 cubic feet

Units

• Costumer Service Charge $4.60 per unit
• Rate per 100 cubic feet $0.3970/100 cubic feet

Fire Lines – monthly per inch $1.85
Fire Hydrant $1.27
Flat Rate $6.50

The ‘Spring Break Quake’ of 1993

Regional water shortage concerns continued into 1993; however, the Commission approved a waiver on its 1987 moratorium for extensions of water service outside the City’s urban growth boundary to accommodate service for McMinnville’s new Wastewater Reclamation Facility in the interest of public health. In July, the Commission met with Richard Schmid, Chief Planner for Mid-Willamette Valley Council of Governments, Yamhill County Commissioner Dennis Goecks, and Polk County Commissioner Mike Propes. The group discussed a regional water resources study, which outlined future water needs, potential methods of meeting future water needs, and recommendations. They also talked about the need to develop an alliance of water purveyors to develop new sources, provide treatment and distribution of water according to a fair share cost allocation plan.[v]

The “Spring Break Quake” rattled McMinnville residents from their slumber in the early morning hours of March 25, 1993. Centered southeast of McMinnville in Scotts Mills and measuring 5.6 on the Richter scale, the rolling-motion-quake cracked the rotunda of the capitol building in Salem and damaged several McMinnville-area bridges. McMinnville’s Columbus Grade School was also a victim of the earthquake. Named for Christopher Columbus and originally located at 600 SW Baker Street, the redbrick structure built in 1930 sustained damage so severe, the school district had it demolished in 1994 and sought a site for a new facility. The old site remains a vacant lot today.[vi]

The construction boom continued that spring, with residential development centered in the north, southwest and west areas of McMinnville, including the Hillside Communities and a new subdivision near the City’s service reservoirs. In May of 1993, water and power crews constructed extensions for the new Columbus Grade School, now located on SW Fellows. Staff reported the connection of 94 new residential services that month compared to just 18 in 1992. Commercial growth also took place in the southeast side of town, including plans for the new Tanger Factory Outlet mall on Three Mile Lane. The Commission authorized the purchase of one 300 kVA and two 500 kVA 3-phase transformers to support the new mall and other future commercial growth. The new residences and commercial enterprises increased McMinnville’s energy use, and BPA issued a notice of an electrical rate increase of 14.8 percent, effective October 1, 1993.[vii]

Strategic Planning and Expansion Challenges

The Commission awarded Robert E. Meyer Consultants (Meyer) the contract for designing the fourth service reservoir at the Fox Ridge site in April 1993. Survey work for the new reservoir hit hard bedrock in July, creating a major obstacle for its construction on the chosen site. In August, the Commission approved a change order for continued surveying and engineering work by Meyer and the engineering design firm went back to the drawing board. They created a schematic layout of the existing three reservoirs on Fox Ridge Road plus site option layouts for the new service reservoir at an elevation between five and six hundred feet situated upon an adjoining piece of property. In October, reporting that this new property met the required elevation and soil conditions, Engineering Manager Art Robare, requested and received Commission approval for Meyer to proceed with the final service-reservoir-number-four design plan. At the same time, the Commission approved the purchase of the 2.44 acres of adjacent land to serve as the new reservoir site.

In early 1994, the Commission held a public hearing to consider the adoption of a Curtailment Plan for Electric Energy as required by the Oregon Public Utility Commission (PUC), which was set into motion with the notice received by McMinnville Water and Light in July 1992. The plan identified the process by which the utility would initiate and implement its portion of the Northwest regional load curtailment. Learning of the Curtailment Plan’s adoption by most other electric utilities in the state, and with the understanding about penalties for non-compliance with the PUC mandate, the Water and Light Commission voted to approve and adopt the proposed Curtailment Plan for Electric Energy.

The Commission began work on prioritizing capital improvement projects after reviewing a list of water projects and associated costs, including the need for expanded capacity at the treatment plant. Water projects alone totaled an estimated $35,250,000. The annual capital construction budget for 1994 stood at $800,000 for water and $600,000 for power. As if that wasn’t enough, a notice from BPA showed a ten percent increase in power rates scheduled for the fall of 1994. Ultimately, after reviewing the needed work for both power and water systems, and considering the BPA’s rate increase notice, the Commission had no choice but to pass the power rate hike on to consumers as well as a five percent increase in water rates. This came in what Engineering Manager Robare called a “banner growth year” in McMinnville. The increased population and six new residential neighborhoods in various stages of design, in 1994 alone, would have kept the utility busy. These projects coupled with new commercial developments on the southeast side of the City, including the development of a new museum (Evergreen Aviation and Space Museum), a new hospital (Willamette Valley Medical Center) and construction work on Tanger Outlet Mall promised to keep the utility’s power and water crews very busy for several years to come. The need for funding was clear, and the increased activity prompted McMinnville Water and Light’s staff, with Commission guidance, to revise its Subdivision Development Policy and Standards. The revisions addressed changes in regulations and code requirements, and updated definitions, including those defining residential adult care homes and electrical rates. The new specifications, amended guidelines and other criteria provided a user-friendly interface and served as a tool for contracting with external entities.

Throughout the 1990s, Bill Davidson, of Mason Bruce and Girard, presented reports of projected watershed timber sales and estimated revenue. These funds would assist with needed expansion of McMinnville Water and Light’s water infrastructure to support new residential neighborhoods and commercial development. During a meeting held on January 26, 1994, the Commission adopted its Long-Range Capital Improvement Plan and Water Capital Improvement Project. First priority projects identified included the construction of service-reservoir-four, replacing 6,000 feet of the 16-inch pipeline from the Scott Water Treatment Plant to the service reservoirs, and preparing an engineering plan for a Three-Mile Lane loop. During the discussion that day, General Manager Harshman mentioned that the new pipeline to the service reservoirs would take three to five years and cost approximately $17 million. Second priority projects included completing the Three Mile Lane loop, the Haskins Creek pipeline, utility upgrades on Hill Road, and the preparation of staff recommendations for engineering and construction to raise McGuire Dam, increasing its capacity.[viii]

Infrastructure Expansion and Operational Adaptations in the Mid-1990s

In the spring of 1994, Engineering Manager Robare reported that the new service reservoir project had expanded in scope from the original concept. At first, staff considered the construction of a seven-million-gallon reservoir south of reservoir number three, with two additional future reservoirs planned as replacements for reservoirs one and two. Reviewing McMinnville’s present and anticipated future growth, the design engineer, Meyer, concluded that construction of a 10.5-million-gallon reservoir would better fulfill the City’s water needs. The Commission considered and approved the new concept, reviewed the project bids on July 19, 1994 and awarded the $3,760,000 construction contract for the new reservoir to Skaar Construction Company. Skaar was also the successful bidder for improving reservoir number three’s seismic resistance at a cost of $17,500. By January 1995, construction work was moving along with forms in place and the last section of wall closed.

Operations Superintendent Nicholls continued his work on watershed issues in 1994, reporting to the Commission about various anticipated rules that affected its management. He also discussed a USFW proposal for a special emphasis area protecting the northern spotted owl, which included 95 percent of the utility’s watershed, and a proposal that declared all streams as navigable. Learning that soil moisture content in the forest was the lowest on record, the Commission authorized Water Superintendent Abrams to purchase a tanker truck for use primarily as an emergency response vehicle for protection in the watershed and secondarily for use in construction activities. Abrams located a 1976 Ford truck with a 3,600-gallon water tank, piping hoses and nozzles for $18,000. The summer of 1994 brought extreme hot weather and increased fire watch patrols in the watershed. The vigilance paid off when fire patrols, inspecting a site designated for camping, found a smoldering fire and put it out before it caused damage to the forest.

Earlier in the year, the Commission discussed and approved the creation of and membership in the Oregon Municipal Energy and Conservation Agency (OMECA). Composed of seven municipal utilities, including Ashland, Canby, Forest Grove, McMinnville Water and Light, Milton-Freewater, Monmouth, and Springfield, OMECA began as a way to achieve economies of scale and to secure funding for BPA conservation programs. BPA funded OMECA’s start-up activities through a multi-year grant with the understanding that OMECA would provide a constant source of funding for the Bonneville Power Administration energy conservation programs through September 1996. Thereafter, BPA expected utilities to fund conservation programs locally. During its August 16, 1994 meeting, the Commission appointed General Manager Harshman to serve as a board member of OMECA, and set September 21, 1994 for a public hearing about the organization, its purpose and funding requirements. The primary topic of the hearing was the issuance of bonds by OMECA to finance the required conservation programs and McMinnville Water and Light’s liability in that regard. Before this time, BPA borrowed funds from the National Treasury for the programs and the OMECA plan had municipal utilities borrowing the funds at a lower rate of interest. In the end, OMECA allowed its member utilities greater flexibility in operating their respective conservation programs. It also weened the utilities off the BPA operational aspects for the federally mandated conservation programs, placing the onus on the utilities. Finally, OMECA allowed its member utilities the opportunity to continue using it as the vehicle for subsequent conservation programs. Hearing no public objections to OMECA membership, purpose or funding, the Commission authorized staff to execute the Project Implementation Agreement with OMECA. On October 19, 1999, Conservation Manager David Christie presented a report to the Commission titled “McMinnville Water and Light Five Year Summary of Energy Efficiency Activities with OMECA“, providing highlights and commenting on the program’s successful conclusion. OMECA officially disbanded on September 30, 1999.

After the public hearing regarding OMECA, the Commission voted in favor of McMinnville Water and Light joining other municipal utilities, including the City of Ashland, Forest Grove Light and Power, Milton Freewater Light and Power and the City of Monmouth, to share the $35,700 cost of negotiating tiered rates and a new BPA power sales contract. Non-Generating Public Utilities consultant Larry Hittle negotiated the contract on behalf of the utility. In January 1995, General Manager Harshman recommended continued work with Hittle due to a wide range of issues and the potential for major cost shifts during 1995.[ix]

In early 1995, Engineering Manager Robare presented a proposal to the Commission, which addressed the need for a power system study to update the information gathered five years previously and to analyze a probable need for a new substation. Robare’s proposal included a short circuit and power flow study on McMinnville Water and Light’s three-phase distribution; a study to determine the effects of overloading and the subsequent loss of the Walnut City Substation on the entire distribution system; and a study to consider the effects of adding another substation to the system. As proposed, study results would include a system one-line diagram, phase and ground fault short circuit calculations, power flow calculations and a written report detailing the findings. The Commission approved and authorized Robare’s recommendation of the $23,855 proposal submitted by Electrical Systems Analysis. Two years later, BPA offered to sell the Walnut City Substation to McMinnville Water and Light and the Commission authorized General Manager Harshman to start purchasing negotiations, which resulted in a first offered sale price of $370,000 by BPA. In May 1997, General Manager Harshman reported a purchase price of $365,000 with a three-and-a-half-year payoff. Before completion of the proposed sale and transfer of Walnut City Substation’s real property title to McMinnville Water and Light, the sales contract directed BPA to pay for certain environmental investigations and any necessary cleanup in that regard. The contract further specified a payback period of three-and-a-half years via savings of low voltage delivery charges. Finally, during an estimated three to four-month period between the date of sale and title transfer, the sales contract stipulated that BPA would continue inspection and maintenance of the substation. The Commission voted unanimously to approve Resolution 1997-13, authorizing the execution of the sales contract and the operational agreement for the period between the sale and transfer of title, which Harshman estimated would take place prior to October 1, 1997.

Water Resource Challenges and Collaboration

Previously, during a meeting in October 1994, the Commission listened to a presentation on the North Yamhill Water Basin Plan and considered a contribution of $20,000 toward hiring a facilitator for the Yamhill County Water Basin Council and the involvement of McMinnville Water and Light in the planning process. Voting to approve of the contribution, the Commission also authorized Commissioner O. C. Yocom to serve as its advisor during development of the Yamhill County Water Basin Council and Plan. In late October 1994, Resource Development Director Jack Nicholls reported water diversion at 15 percent more compared to the same time of year in 1993, and Water Superintendent Abrams reported that water capacity stood at 53 percent and declining.

The Commission closed out 1994 by meeting jointly with the McMinnville City Council during which all members thoroughly discussed long-range goals, a computer network, joint City of McMinnville and Water and Light staff meetings, new sewer facilities and operations, timber and watershed resources, and governing efficiency by addressing future opportunities through mutual efforts. Councilors and Commissioners also discussed two issues that would have growing significance in the future. The first issue related to a fiber optic network and coordinated Geographic Information System (GIS) mapping efforts. The City’s Public Works Director, Don Schut, presented a water re-use proposal for CSRM, which also addressed the second issue: water resource conservation. While it sustained the moratorium on expanding service to consumers outside the urban growth boundary, the Commission continued to consider annexing residences from time to time for emergency reasons, such as contaminated wells. One such consideration began in late 1994 and involved a Yamhill County resident who had previously shared water resources with two other homeowners through a water association. When the owner of the land under which the well stood passed away and heirs took over the property they issued a notice to the other two homeowners that water would no longer be provided to them. One of the two other homeowners approached the Commission, which initially declined the homeowner’s request in 1994, asking them to try drilling a well and exhaust all other options. After drilling for water on their property and finding none, and after approaching the second property owner about sharing a well drilled on their property and being turned down, the third property owner ran out of options for water. This homeowner built and lived in their home for nearly 40 years before facing a future with no accessible water. So, when the homeowner returned after exhausting all possible options the Commission reconsidered and allowed an exception, especially when receiving proof of the association’s termination of the homeowner’s water supply. The homeowner had to agree to contract conditions on costs associated with extension of a service water line, sustained water pressure and treatment, and water rates outside the City limits. The on-going issue of failing water supplies was a recurring theme faced by the Commission that would continue in greater magnitude in the coming years.

Resource Management Challenges and Environmental Conservation Efforts

During its April 18, 1995 meeting, the Commission heard a report from General Manager Harshman about a FERC filing by Idaho Cooperatives, which sought to force the purchase of Grant County power. Harshman recommended the approval by the Water and Light Commission of a joint defense agreement with other Grant County power purchasers. After brief discussion, the Commissioners voted unanimously to protect McMinnville Water and Light’s Grant County participation and join the defense effort.

That spring, Harshman reminded the Water and Light Commissioners about the approaching Integrated Resource Planning public hearing, set for October 17 that year. Distributing an Integrated Resource Plan and General Power Management Services Request for Proposal (RFP) to the Commissioners, he requested their approval to advertise the RFP. As a requirement of the Federal Regulatory Policy Act, the purpose of the Integrated Resource Plan was to evaluate the power supply and demand side resources reasonably available to McMinnville Water and Light. Using the Integrated Resource Plan, a new consultant would assist McMinnville Water and Light staff in power management issues; help with acquisition and management of future resources; and conduct BPA Power Sales contract negotiations on behalf of the utility. Ultimately, the Commission authorized a contract with PRM for the Integrated Resource Plan and General Power Management Services.

Consultant Bill Davidson, of MBG, informed the Commission about “hooting” sessions in the watershed as part of monitoring activity for northern spotted owl habitat. Hooting sessions took place during the springs of 1993 through 1999. Initially in 1993, biologists discovered evidence of nesting, but subsequently nothing further until the sighting of a nesting pair in the spring of 1997. Meeting at the watershed site, Davidson and biologists from BLM and USFW established a core habitat area. The biologists took the opportunity to band the birds for tracking as part of BLM’s habitat conservation plan. Unfortunately, for the utility, the pair of owls and their imminent offspring presented a roadblock to a pending timber sale. The Commission hoped to salvage at least part of the sale by allowing logging on only the portion of land not affected by the nesting pair of endangered northern spotted owls; however, USFW considered most of the area northern spotted owl foraging habitat until after September 30 that year, effectively cancelling the transaction. After 1997, Hooting sessions conducted in watershed areas destined for logging did not detect nesting activity, and as of the summer of 1999, USFW declared the Haskins Creek northern spotted owl’s nesting site abandoned.

Infrastructure Improvements and Energy Conservation Initiatives

During its May 16, 1995 meeting, the Commission reviewed and compared bids received for a Water System Master Plan Study. After listening to Engineering Manager Robare summarize the components of the planned study, including capital improvement projects, growth and projected needs for water, fire flows, reliability issues and computer modelling software, the Commission awarded the Water System Master Plan Study to Murray Smith and Associates.

Heavy rains in early 1995 and through that spring caused several landslides in the watershed. MBG’s Bill Davidson reported one such occurrence at the location of 500 Road, and Water Superintendent Abrams reported that a landslide caused major damage to the Haskins Diversion Dam system. These weather-related events were harbingers of the near future. Poor weather that spring and into early summer also slowed subdivision construction work and delayed pre-stressing operations at the service reservoir site; however, construction was back on schedule in late June. Workers repaired the floor joists in service-reservoir- one during July and by the end of the summer, all four reservoirs had received new coats of green paint. With final calibrations on reservoir-number-four culminating in late October, the service reservoir project saw completion. All four reservoirs were online that fall just as the Commission placed advertisements for the Highway 99W Water Main Project and repairs got underway at the Haskins Diversion Dam.

Conservation Manager David Christie joined the McMinnville Water and Light Commission meeting on October 17, 1995 and presented a synopsis of the utility’s Energy Audit. As presented by Christie, the first phase of the Energy Smart Design Program examined energy use and climate control in the utility’s facility buildings. The Commission approved the installation of new lighting, which reduced annual power use by 124,000 kilowatt hours and saved the utility $4,400 in annual power costs. The initial investment of $23,000 for the lights, minus a rebate of $10,107, resulted in a net investment of $12,893, and the utility achieved a return on investment payback in less than three years. This activity by the Commission set an example to the community of energy conservation in action and the program advanced into business and residences in McMinnville.[x]

In April 1995, the Commission hired Robert E. Meyer Consultants (Meyer) again – this time as design engineer on the Highway 99W Water Main Project for the sum of $33,625. This project came about in response to the Oregon Department of Transportation’s planned restructuring of the highway on the south end of McMinnville between the Fellows Street intersection with the entry to Linfield and the junction of Highways 99W and 18. After completion of the project’s design phase, the Commission requested construction proposals for the project, and heard from Dale Merrell, of Meyer toward the end of 1995 about recommendations for awarding the contract. As part of a state project with the Oregon Department of Transportation, which was subject to reimbursement expenses for relocated utility facilities, the bid process required contractors to submit a prequalification statement as part of their proposals. A first review of the proposals disqualified two of the four bidders because they did not submit the required documents. After listening to Merrell’s recommendation and discussing the bids, the Commission approved the proposal from Kerr Construction for $718,793 as the lowest and best for the Water Main Project. The Commission also retained Meyer as contract administrator with resident observation services for the project.[xi]

Natural Disasters and Watershed Recovery

December 12, 1995 brought a blast of wind to the West Coast states of California, Oregon and Washington, with peak gusts nearly matching those of the 1962 Columbus Day Storm. Meteorologists classified the storm as catastrophic, with winds reaching 120 miles per hour in Oregon. While the storm of 1962 tracked the coastline, the 1995 storm started further offshore and travelled southwest to northeast building strength to a Category 2 hurricane (on a scale of 1 to 5, with 5 being the strongest). Although it started building steam further out to sea (600 miles off Oregon’s coastline), when it did reach land its brutal force blew trees into buildings and power lines, knocking out electricity for thousands across the region, including McMinnville. During the Commission’s December 19, 1995 meeting, Bill Davidson reported extensive wind damage on watershed lands, especially on its southern boundary, with timber loss in excess of one million board feet. He suggested that the Commission consider timber sales to salvage the blowdown.[xii]

Work began on the Highway 99W Water Main Project in January 1996. Other projects also started ramping up, including pursuit of Supervisory Control and Data Acquisition (SCADA) software for the electric system, raising McGuire Dam, and three additional major water projects; however, Mother Nature had different plans for the utility and area residents. [xiii]

A very familiar pattern of weather arrived in Oregon during the late autumn and winter months of 1995 and 1996. Heavy rainfall during November and December saturated the ground to the point where it could no longer absorb water. Then, an above-average snowfall arrived in January followed by very cold, below average temperatures. On February 6, the “pineapple express” brought warm, moist air to the region, thawing the deep freeze with rising temperatures, resulting in more heavy rain, rapidly melting snow and extreme flooding across the Willamette Valley. Roads washed out, homes floated away, and several people lost their lives. Over the next several days, the area saw 15 inches of rainfall. The South Yamhill River at McMinnville normally reached flood stage at 50 feet; however, on February 9, 1996 it crested at a record 59.33 feet before receding. During an emergency meeting held on February 12, 1996, the McMinnville Water and Light Commission listened to General Manager Harshman’s report on damages to the utility’s facilities and roads. Water Superintendent Abrams shared photographs that showed the seriousness of damage.

“A landslide came down from an embankment above the Link Impounding Dam bringing trees and mud with it,” Abrams later recalled. “Landslides also destroyed the Idlewild and Haskins diversion dams – and so many roads in the watershed that it was very difficult to get around and assess the damage.”

The flood caused closure of the access road to McGuire Dam due to severe damage; it also washed away many culverts, which contributed to impassable roads in the watershed. Due to the extreme situation, the Commission drew up an emergency contract with Kizer Excavating and the company acted quickly to mitigate the damage and commence repairs to the watershed facilities. The mud and debris in the water also affected the Scott Water Treatment Plant.

“Water flows from Haskins Creek to the Link Impounding Dam and Reservoir then through pipes into the treatment plant,” said Abrams. “Diane Holmes was in charge of the Water Treatment Plant but she was on vacation and out of the area when the storm hit, so I spent a lot of time supporting the operators at the Plant. The turbidity was extreme. Normally the water coming into the plant runs at about 200-300 units of turbidity; during the storm it ran at 1,000-2,000 units of turbidity.”

The Water Treatment Plant could not sustain the water turbidity at those levels, and exceeded the turbidity allowance for a short time.

“The pressure was on us, but we overcame the challenge by slowing down the plant production from the normal three-four million gallons per day to one million,” Abrams recalled. “By doing that we could make good clean water.”

The service reservoirs in town stored 20 million gallons of water and customers drew on the supply at the rate of two to three million gallons per day.

“We went through about three or four days of that activity, before things settled down to manageable levels and we started increasing water production again,” said Abrams.[xiv]

The Commission heard an update about the repair work in the watershed undertaken by Kizer Excavating during a late February dinner meeting. Other businesses stepped up to help in the aftermath of the flood and windstorm, including Laughlin Logging, which removed fallen trees above Link Reservoir and Impoundment Dam. Overall, the storm damage recovery set subdivision and water main work back about four weeks. During the same meeting, the Commission participated in a discussion with Yamhill County Commissioner Dennis Goecks about the on-going Yamhill River Council watershed study. Components of the plan included water quality and supply, fish and wildlife protection and stewardship of the water source.

Modernizing Operations: McMinnville Water and Light’s Technological Advancements

In March 1996, the Commission received the Water System Master Plan from Murray, Smith and Associates (MSA), which provided the utility with information and guidance necessary for the stewardship of the municipal water system within its service boundary including maintenance and operational references. Highlighting known system deficiencies and illustrating recommended improvements, the plan presented cost information for budgeting and capital development purposes, as well as communication tools for relaying information to the utility’s consumers. Expansion of the distribution grid, pressure zones, reservoirs and pump stations were among recommended improvements in the plan, which outlined annual activities through the year 2000 and included future improvements in five-year intervals from 2001 through 2025. The Commission adopted the Water System Master Plan by Resolution 1996-4. It also authorized the preparation of an RFP to conduct the second phase of the Master Plan, an Integrated Engineering Study, which included a water system sources overview as well as the examination of necessary improvements for McGuire Dam and the Scott Water Treatment Plant. The objectives of the study helped determine the need to develop alternate water sources and the criteria for doing so. It included a preliminary engineering design, an environmental impact statement, a watershed management plan and the permit applications necessary for raising the existing McGuire Dam. On September 17, 1996, the Commission awarded the $296,795 Integrated Engineering Study contract to MSA.

Examining the merits of an industrial computer system that would improve efficiency in monitoring voltage-transmission lines and distribution substations was the focus of a Commission meeting in May 1996. Listening to Malm Engineering’s presentation about Supervisory Control and Data Acquisition (SCADA) software and its benefits, Commissioners learned that SCADA’s user-friendly interface provided information about power usage and power outages among the utility’s six substations. Besides electric power (generation, transmission and distribution) and water (drinking, wastewater and sewage), other industries that use SCADA systems software include manufacturing, oil and gas, food and beverage production, building construction, and mass transit and traffic signaling systems on roadways, bridges and tunnels. Weighing the benefits of a SCADA system as a foundation for McMinnville Water and Light’s future, the Commission voted to award a $130,000 SCADA system contract to Malm Engineering.[xv]

Emergency Repairs and Ongoing Challenges

Repair work continued through the spring and summer of 1996 on flood areas damaged from the winter storm earlier in the year. Repairs to watershed roads also continued that summer with logging and paving companies picking up the work due to Kizer Excavation’s seasonal construction commitments. Costs exceeded $16,000 in road repairs alone. In September 1996, Water Superintendent Abrams reported the reappearance of a sinkhole at the Link Reservoir and Impounding Dam. A similar problem had happened ten years previously and it needed immediate attention before the autumn rains caused further issues. One issued led to another, keeping water crews working at a feverish pace.

“We needed to inspect the damage to the Link Impounding Dam, which required draining the reservoir; however, before we could address that task, we had to repair the diversion system to keep the water flowing to McMinnville,” recalled Abrams. “Once we rebuilt both diversion dams, we could once again divert the water flowing from Haskins and Idlewild creeks around Link Reservoir through the pipeline and to the Water Treatment Plant.”

The Commission approved an expenditure of $15,000 for repair work, which was independent from the repair work caused from the landslides that occurred in late 1995 and early 1996. Abrams reported the issue resolved in late September; however, he requested and received an additional $25,000 to expedite emergency construction measures for the landslide above Link Impoundment Dam before the rains came.[xvi]

Deloris Land Retires, Nolan Steps in: A Legacy of Service at McMinnville Water and Light

Commission Clerk Delores Land retired on October 31, 1996 after serving the Commission as Clerk for 17 years, and a total of 30 years’ service to McMinnville Water and Light. The Commission unanimously appointed Executive Secretary Mary Ann Nolan as interim Clerk beginning November 1, 1996. Nolan became an employee of McMinnville Water and Light in 1977 and had the benefit of working with Dee Land and the Commission’s second Clerk, Mary Koch. Nolan performed basic secretarial work, accounting and human resources related tasks for the first few years. She soon learned enough about the utility’s administrative responsibilities to become Assistance Office Manager, and often took shorthand notes during Commission meetings.

In the early years, the administrative staff performed most office tasks by hand, creating ledgers, purchase orders, contracts and correspondence with writing utensils and paper. Gradually, administrative staff began using office machines to perform their tasks.

“I used an IBM Selectric typewriter to prepare purchase orders and other information on forms with multiple sheets of carbon paper,” Nolan remembered. “Later, I worked with an Olivetti brand electronic typewriter, which had a 5-inch floppy disc drive attached.”

Using the Olivetti to assist Clerk Land type up the Commission meeting minutes from dictation, Nolan also created the final versions by editing the redlines with the machine.

“A few years later, Dee and I were the first of the administrative staff to receive and use word processing stations,” said Nolan. “They were National Cash Register machines, which had the ability to interface with a mainframe computer.”

When Robin Morecroft became General Manager in 1986, Nolan served as his executive secretary.

“At that point, office staff began sharing personal computers, but still used typewriters and word processors,” Nolan recalled. “Software also changed over the years from IBM’s Lotus 123 to Microsoft’s Excel for work involving spreadsheets; and from Word Perfect to Word.”

John Harshman became General Manager in 1988 and Nolan became his executive secretary. McMinnville Water and Light staff moved to its Marsh Lane facility soon after. After Clerk Land retired, Nolan took on a special project.

“I began reviewing the old, hand written minutes and the typed versions generated later,” she remembered. “I preserved the minutes and other archival materials in a special room known as “the vault”.

She organized the historic materials, which made them available for reference, and when people needed to locate something, they went to Nolan. Over the years, she became part of the utility’s institutional memory. Nolan was familiar with what happened behind the scenes, and often reminded staff about issues that needed follow up. She was conscientious and detail oriented, helped train staff; often served as a coach or mentor, and provided support where needed.

During its first meeting of 1997, the McMinnville Water and Light Commission elected Mary Ann Nolan as its fourth Commission Clerk, and she officially began those duties on January 21, 1997.[xvii]

Power Sales and Contract Negotiations

Throughout the latter half of the 1990s, the Commission examined its commitment to provide power to Cascade Steel Rolling Mills; the stability of the stock market and its effects on McMinnville Water and Light; and the changing nature of its relationship with BPA. Topics of discussion included possible diversification in power sources and the correlation between market fluctuations and the utility’s ability to establish compensatory rates. The later discussion led to an RFP advertisement for an electric rate study. During the Commission’s June 1996 meeting, it accepted the $29,180 proposal from Economic and Engineering Services and authorized General Manager Harshman to negotiate a rate study contract. Then, during a special meeting on June 25, 1996, the Commission considered the benefits of approving Amendment 7 to the BPA Power Sales Agreement, originally executed on August 19, 1982. It also considered risks associated with diversification and the practice of retail wheeling, which is the process of moving third party electricity from a point of generation across the distribution systems of a service provider like McMinnville Water and Light and selling it to a customer.[xviii]

Economically speaking, electricity is a commodity, and as such, it is available for purchase and sale in a system known as an electricity market. An electricity market system enables entities to purchase through bids, sell through offers, and conduct short-term trades in electrical energy. Trades lasting for longer periods result in contracts similar to the power purchase agreements between McMinnville Water and Light and BPA. Market operators or special entities generally conduct wholesale transactions in electricity due to the specialized knowledge and understanding of what it takes to maintain generation and load balance. An electricity market consists of two types of commodities: power and energy. “Power” is the net electrical transfer rate metered at a given time using a unit of measure known as megawatt(s) (MW) and equal to one million watts. “Energy” is electricity that flows through a metered point for a given time span and measured through megawatt hours (MWh). During the late 1990s, the electrical power market underwent a form of deregulation, which spawned the formation of entities known as independent system operators (ISOs) as well as regional transmission organizations (RTOs). These entities helped handle the incredible increase in transactions resulting from deregulation.

Continuing its deliberations for the Power Sales Agreement with BPA during a special meeting held on September 25, 1996, the Commission authorized General Manager Harshman to draft a “Network Integration Service Bridge Agreement” in lieu of an executed agreement, which the utility and BPA had yet to finalize. The Bridge Agreement allowed more time for both entities to finalize the details of the new contract. In this way, the utility would receive power transmissions from BPA starting on October 1, 1996 under the terms of the new agreement and until its execution, which finally took place in April 1997. During the same meeting, the Commission considered and approved McMinnville Water and Light’s membership in a newly formed trade organization known as the Oregon Public and Cooperative Utility Association, which later became the Oregon Utilities Resource Coordination Association (OURCA). Membership in the association enabled the utility to analyze, negotiate and contractually implement various electric power supply, sale, exchange, scheduling, resource transactions and other related opportunities determined through joint participation and effort.

In March 1998, General Manager Harshman approached the Commission about the culmination of ongoing negotiations between OURCA and BPA, resulting in a possible contract for McMinnville Water and Light and five other utilities. He stated that the proposed contract would be in addition to the utility’s firm resource exhibit and prior approvals for power diversification. Engineering Manager Robare assisted Harshman by presenting an overview of the utility’s power resources over time, as well as its annual load and its composition. Robare explained that there were actually two contracts for consideration, each spanning eight years, with the first pre-2001 (three years) and the second post 2001 (five years). BPA desired to extend agreements beyond the 2001 expiration of all Northwest contracts. With the understanding that accepting the contract could bring thousands of dollars in potential savings to the utility, the Commission authorized its lead counsel, Dave Haugeberg, to work with attorneys of the other OURCA utilities to finalize it. The Commission also authorized Mayor Gormley and Clerk Nolan to sign the contract, with the stipulation that savings equaled at least $600,000 over its three-year-life. Returning in March, Attorney Haugeberg reported that the first contract would exceed the $600,000 goal and that projected savings amounted to approximately $1.1 million, after which the Commission voted unanimously to ratify the BPA contract covering 1998-2001. During a meeting the following month, Harshman and Robare reported that OURCA had successfully negotiated the second power sales contract with BPA for the years 2001-2006, and the Commission approved it through Resolution 1998-2, authorizing the five-year contract.[xix]

Innovative Power Scheduling and Savings

On October 1, 1996, McMinnville Water and Light became an Actual Computed Requirements customer of the Bonneville Power Administration. This required McMinnville Water and Light to schedule its power needs with BPA. The commission reviewed the Power Management and Scheduled Services proposals of several other public and municipal utilities, including EWEB, PanEnergy and Power Resource Managers. Some of the other utilities offered fixed fees while others offered cost plus or index fee structures. All offered some form of incentive plan to share potential savings. In addition to meeting McMinnville Water and Light’s requirements to schedule power with BPA, the management of the municipal utility’s power needs presented an opportunity to reduce the amount spent on purchasing energy and the potential savings increases for each of the five years remaining under the BPA Power Sales Contract. Staff recommended and the Commission adopted the proposal for the purchase and sale of power received from EWEB for $50,000 annually plus 15 percent of savings. After executing a memorandum of understanding between McMinnville Water and Light and EWEB, the Commission passed Resolution 1997-2, authorizing and approving power scheduling and services, and an enabling agreement between the City of McMinnville and the City of Eugene through their respective municipal utilities in February 1997. The utility realized a net savings over the first six months of the agreement of approximately $325,000.

During the Commission’s November 1996 meeting, Engineering Manager Robare, reported the receipt of four enabling agreements. These agreements defined the process of doing business relative to power purchases or sales and set in place the mechanism for the transactions. With the agreements having gone through FERC review, the Commission approved the purchase and sale of electric energy between McMinnville Water and Light and the Montana Power Company, PacifiCorp and the Washington Water Power Company, authorizing Mayor Gormley and Clerk Nolan to execute the service agreements. Robare also reported that rising electricity market prices did not offer any opportunities for purchasing low cost power; however, the utility did return some power to the Washington Water Power Company at a profit. The Commission closed out 1996 by authorizing a $33,000 agreement with BPA to reconfigure the way the utility received pulse signaling, which was how the utility measured its bill with Bonneville.[xx]

Navigating Deregulation: A Strategic Approach to Power Purchases and Energy Assistance Programs

In the early months of 1997, General Manager Harshman, utility staff and the Commission spent time focusing on the utility’s power purchase methodology to address deregulation and the way different entities conducted power purchases. Harshman presented a resolution to buy power using a venue allowed by the market and stated that once passed, staff could bring forward a bid award for about five MW of power for an estimated five-year time frame. The resolution also stated that staff would obtain at least three competitive quotes if possible; however, the power market at that time provided short-lived opportunities, sometimes with as few as two hours and quotes good for only a few days. After considering its options, the Commission approved Resolution 1997-8, which exempted purchases and sales of power and transmission related services from the competitive bidding requirements under ORS Chapter 279

Several more enabling agreements arrived for consideration by the Commission in early 1997, which sparked a discussion about joining the Western Systems Power Pool (WSPP) as a mechanism for processing the enabling agreements. After approving the enabling agreements with Idaho Power and the Grant County PUD, the Commission reviewed the WSPP agreement and authorized Harshman to apply for membership and pay a one-time fee of $25,000. WSPP membership allowed the utility to carry out power transactions with all WSPP members without having to approve separate enabling agreements for the sale and purchase of electric energy with each entity.

In early May 1997, Engineering Manager Robare sent out-a letter to a group of power marketers indicating McMinnville Water and Light’s interest in purchasing a block of power for a five-year period beginning October 1, 1997 and ending September 30, 2002. He reviewed eight responses with the Commission during its May 20 meeting. Unfortunately, due to a brief, two-day spike in power prices, acceptance of any of the offers by the Commission would have locked the utility’s consumers into a five year contract of high cost energy. With that in mind, the Commissioners did not find any of the bids in the best interest of the utility or its customers, and voted to reject them all. Keeping a close eye on the volatile electricity market, Robare recommended a bid from Washington Water Power / Avista, on June 17, for the purchase of a block of power for a five-year period, at $16 per MW for the first year and $16.40 for years two through five. With time of the essence, the Commission voted unanimously to accept the bid, and authorized Mayor Gormley and Clerk Nolan to execute the contract, which also became a part of the utility’s firm resource exhibit with Bonneville. The next opportunity for purchasing a power block came in 1998, when the Commission approved and authorized a three-year (1998-2001) contract with Avista at $19.70 per MW. Prices continued to increase, as illustrated by a five-year purchase from Enron at $23.70 per MW in May 1999.[xxi]

Considering the effects of rising electricity costs, Key Accounts Manager Wes Thomas brought an idea to the Commission that became the Energy Assistance Program (EAP) in early 1998, and which helped low-income residents pay their electric bill. EAP allowed McMinnville Water and Light customers to donate funds via their utility bill payment. Approving the new program, the Commission chose St. Vincent de Paul as the external agency to manage and distribute the EAP funds. Brochures went out to inform customers about the new EAP in August and resulted in an immediate and positive response. This program later became Customers Helping Customers.[xxii]

Earlier, in November 1996, a surprise windstorm launched several months of winter weather in the Pacific Northwest, knocking out power and delivering six to eight inches of snow to watershed areas. Water Superintendent Abrams reported the draining of McGuire for routine inspection and examination by the Integrated Engineering Study team during a snowstorm that month. Phil Smith and David Leibbrandt of MSA discussed preliminary engineering and water source expansion beyond the need to raise McGuire Reservoir, including expanding the Scott Water Treatment Plant’s capacity. The consultants told the Commission that the utility’s investment over the years was too substantial to consider moving or adding another treatment site. Further, they discussed an option to improve the plant’s filtration system from 13 million gallons per day (MGD) to 20 MGD with the use of two more filters and contact basin expansion. The consultant firm took core samples from the existing filters and discovered worn out and degraded filter media. They also reported the difficulties operators experienced when treating even low turbidity waters.

Bearing in mind the seriousness of the situation, the consultants prepared recommendations for Water Treatment Plant improvements and presented them for consideration by the Commission during its December 1996 meeting. The plan described an emergency sole-source procurement process to upgrade the existing underdrain and media for the four Treatment Plant filters, which would bring them up to a design consistent with future expansion to 20 MGD capacity. It also outlined a schedule for conducting the tasks from mid-April to mid-June, completing the upgrade prior to the summer peak. The Commission voted to move forward with the emergency upgrade and authorized General Manager Harshman and Clerk Nolan to place advertisements requesting proposals for the necessary construction portion of the project. In the meantime, Engineering Manager Robare worked with MSA to obtain information regarding the cost of filtration materials and pursued a contract for Commission approval.

Water System Upgrades and Strategic Planning

Work on the Integrated Engineering Study (IES) continued in January and February of 1997, with the primary focus now shifting to McGuire Dam and MSA’s David Leibbrandt reporting that a center raise of the dam was the most cost effective, efficient and best approach. Leibbrandt, Robare and Water Superintendent Abrams recommended the purchase of filter replacement materials from the F. B. Leopold Company, Inc. (Leopold). Considering the recommendation, the Commission voted unanimously to approve a $278,200 contract with Leopold, which included shipment of the materials by truck so that they arrived in time for the yet-to-be-selected contractor to commence work by April 15, 1997. In mid-March, General Manager Harshman recommended the $196,500 proposal received from Boyington Construction, Inc., for filter installation at the Scott Water Treatment Plant and the Commission authorized a contract. In April and May, Robare and Abrams reported progress on the underdrains and shared photos with the Commission that showed the filter upgrade progress. With two filters operational, Abrams reported that the plant operators saw an increase in filter runs to 72-hours after the upgrades compared to 24 – 48-hours before.

Reporting on the status of the water system IES in June 1997, Leibbrandt informed the Commission about four separate but related matters. First, he brought the good news that Boyington Construction had substantially completed upgrading the filter media at the Water Treatment Plant, on time, within budget, and with no change orders. Second, he reported on MSA’s basic analytical work on the IES, reviewing its findings with McMinnville Water and Light staff. The outcome of the study, which was about 90 percent complete, brought forth two recommendations.

First, the firm recommended raising McGuire Dam by 30 feet and further engineering studies regarding future water-source development. Leibbrandt commented on the anticipation of detailed wetland delineations. The delineation process establishes the location and size of a noted wetland and provides details about what is and what is not contained within the site. Leibbrandt relayed the need to address the delineation fieldwork during the active growing season prior to the onset of hot, dry summer weather. He recommended accomplishing the wetlands delineation fieldwork immediately; waiting past June would delay the McGuire Dam raising project by a year. In addition, Leibbrandt mentioned a scheduled Insurance Services Office inspection, taking place in July, for which staff preparation was underway. The Insurance Services Office performs reviews of all public water and fire suppression systems on a 10-year cycle. As the City’s water system comprised 40 percent of the Insurance Services Office rating, it was very important. During the review, McMinnville Water and Light staff would present information about the incremental hydraulic ability of the utility’s water distribution system, including improvements currently underway such as rebuilding the diversion dam structures on Idlewild and Haskins creeks. The second recommendation presented by Leibbrandt involved capacity expansion of the Scott Water Treatment Plant. Presenting a tentative five-year schedule predicated on the raising of McGuire Dam, he reported various system recommendations totaling a cost of $35 million. Focusing on the most critical items, the Commission authorized an additional professional engineering service agreement for Insurance Services Office review assistance from MSA and the addition of the wetlands delineation fieldwork as a supplementary task under MSA’s existing engineering contract.[xxiii]

Subdivision Expansion and Water Main Upgrades: Enhancing McMinnville’s Infrastructure

Subdivision construction, infrastructure expansion and maintenance activities continued at a strong pace in McMinnville during the latter half of the 1990s. As part of its master plan for water system improvements, McMinnville Water and Light upgraded the water transmission main to 36-inch pipe, improving the distribution ability of water from the service reservoirs to town. The Commission also awarded multiple contracts for water line replacement and extensions, including those along Hill and Baker Creek roads, the Baker Creek and Michelbook Lane area, and the area between Adams Street and Michelbook Lane from Fourth to 19th streets. Water main replacement and improvement work also took place on Highway 99W, Linfield Avenue, Davis and Lever streets, and Lafayette Avenue. With the City of McMinnville planning to rebuild Lafayette Avenue, beginning at the Three Mile Lane Bridge through Highway 99W, Engineering Manager Robare and Water Superintendent Abrams suggested the opportunity to address older pipes and avoid ODOT’s right of way for the main transmission line. Requesting approval by the Commission to hire an engineering firm for the design work, they noted that proceeding with this work facilitated the master plan for water system improvements. They further noted the receipt of two bids for the proposed engineering services, and after reviewing and discussing those, the Commission accepted the $118,730 proposal of Bookman-Edmonston Engineering and authorized Water and Light staff to move forward with a contract. The water main improvement project was also a joint effort between crews of McMinnville Water and Light and the City of McMinnville, aligning coordination efforts, and offering cost-effective solutions to the needed water main replacements.

McMinnville Water and Light’s Commitment to Quality and Conservation

Greg Gardner assumed the role of electric superintendent upon Chuck Kadell’s retirement in 1992. During its July 16, 1996 meeting, the Commission heard a report from Gardner about the aged and undersized cables at Windishar Substation and the possibility that they would not meet peak load requirements. He discussed the necessity of removing overhead substation feeder getaways and associated excavation work to relocate and replace them with underground cables, which involved the removal of utility poles from the CSRM property. The Commission authorized the purchase of 40,000 feet of conduit and six concrete vaults. CSRM agreed to a permanent easement for the new underground lines. In October of 1997, Gardner requested a new transformer at Windishar Substation and the Commission authorized the purchase a 20/27/33 MVA power transformer double the size of the original, with a load-tap-change regulator and the capability to regulate voltage to the system for $401,057 from Pauwels. Tice Electric performed the necessary bus work in preparation for the new transformer.[xxiv]

Previously, Commissioner Tom Tankersley requested MBG’s Bill Davidson to provide research information regarding forestry practices in watersheds. Davidson appeared before the Commission during its November 1996 meeting, citing a summary from Forest Practices and Stream Flow in Western Oregon, an article that appeared in US Forest Service Technical Report No. 49. Davidson explained that when forest managers followed best practices in timber harvesting, soil properties in Western Oregon headwater basins will not affect run off events in extensive downstream flooding; however, other hydrological phenomena may overshadow the effects of clear-cut timber harvest and storm runoff, e.g., debris may clog culverts. Davidson added that 15 years’ previously, the Commission began following the recommended practice of a 50 year rotation of watershed timber areas slated for harvest, cutting only about two percent of the timber annually. The Water and Light Commission followed this practice consistently, never exceeding a 2 percent harvest, and in many years harvesting less than that amount. In fact, the total timber harvested in clear-cut fashion from McMinnville Water and Light’s watershed in 1996 stood at only 1.2 percent.

“The Commission always complied with Oregon’s Forestry Act (1971),” recalled Commission Chair Tankersley. “But even before that, the priority was to manage the watershed for water quality, with timber revenue a secondary consideration. As a result, the Commission took a conservative approach, harvesting from smaller clear cuts than the state allows.”

Davidson pointed out that erosion results in sedimentation entering water, which degrades water quality. McMinnville Water and Light continuously meets the water quality objectives outlined in Oregon Forest Practices when hiring logging companies and other firms that use best practices in forestry management. The utility has always exercised conservation measures, reducing sedimentation in the watershed by minimized site disturbances, laying out harvest units to avoid streams and unstable areas, and using yarding systems that match terrain and harvest methods. Building roads in the watershed, the utility utilizes grass seed to stabilize the soil. In conclusion, Davidson stated that the utility has and continues to follow best practices in conservation and forestry management of the watershed.

Sustaining Resources: McMinnville Water and Light’s Environmental Stewardship Journey

The Commission returned its focus to the IES on October 9, 1997, reviewing two agreements during the meeting. The first covered preliminary engineering and permitting work associated with raising McGuire Dam, and the not-to-exceed amount of $826,000. The second included full engineering services related to improvements and modifications to the Link Reservoir and Impoundment Dam and its two diversion dams, for no more than $309,500. MSA’s David Leibbrandt explained that the agreements pertained to time and material based on estimates of the work; however, while his firm could define some of that work extremely well, other portions depended on the costs and requirements of permitting. In these cases, as the project moved forward, staff would have to weigh regulatory requirements against the budget prior to proceeding with each task. Leibbrandt also cautioned that while there was not a requirement to conduct an Environmental Impact Statement some organizations decide to do so as a means to expedite their projects.

Leibbrandt previously elaborated on the IES, explaining what the estimated $1.1 million project entailed. Approximately 25 percent was associated with engineering efforts to support rebuilding the diversion system and some modifications on Link Dam. Another 25 percent allocation went toward the permitting effort, including environmental and land use permits. The first phase of geotechnical explorations, including aerial photography and surveying to provide the basic mapping, which confirmed costs and supported the permitting process, comprised the third 25 percent. The final 25 percent covered the preliminary design, which supported the permit. Leibbrandt stated that the entire program, if successful, would take until the summer of 2001. He further explained that the process was set up so there were no “lost costs” (for example, if a deviation occurred during the permitting process), and that the plan assumed an Environmental Impact Statement would not be required. The Commission accepted the IES with the understanding that it served as a Commission resource for future engineering and planning. Passing Resolution 1997-17, the Commission authorized and approved an agreement for professional engineering services with MSA for diversion system rehabilitation on Idlewild and Haskins creeks, and modification of the outlet and drain piping on Link Dam. The Commission also passed Resolution 1997-18, which authorized and approved an agreement with MSA for professional engineering services relative to improvements on McGuire Dam. Soon after, Water Superintendent Abrams requested and received Commission authorization to purchase 640 feet of new 30-inch pipe at $19,008 for diversion system repair work identified in the IES. The pipe replaced a particularly problematic submerged portion of the diversion system that had seen numerous repairs and continued to leak.[xxv]

Meanwhile, CH2M Hill continued reporting to the Commission on the status of the Sidalcea Nelsonia studies with a primary goal of securing Walker Flat as a future unencumbered water reservoir site and a secondary goal of closing the long-term studies of the plant in such a way as to secure the Walker Flat site. During their May 20, 1997 meeting, Commissioners voted unanimously to transition from monitoring the plant to helping with recovery efforts as they passed an expenditure approval for CH2M Hill to continue its work on the program for the next year.[xxvi]

A review of the proposed 1997-98 McMinnville Water and Light Budget showed a projected loss for the Water Department of approximately $14,000. Commissioners considered the possibility of a water rate increase; discussed the utility’s views about timber income; compared current water rates with neighboring communities, and examined long-range capital plans prior to unanimous approval of the annual budget; however, they relayed their concern about Water Department solvency and encouraged General Manager Harshman in his efforts to oversee a positive net 1997-1998 income. All considered, McMinnville’s water resource planning placed it in a better position when compared to other communities in the region. For example, on April 20, 1999, Mayor Steve Sampson, of Carlton, made an appearance at the monthly Water and Light Commission meeting to discuss his city’s water situation. Sampson displayed photos of a recent landslide, which muddied the water supply. Heavy rain following the landslide made filtration virtually impossible and shut down water production. Although the City of Carlton was making efforts to solve its water problems, Sampson sought water from the City of McMinnville in case of future emergencies. Water Superintendent Abrams explained the mechanics of using the old intertie, which had given the City of Carlton access to McMinnville’s water supply in the past. The Commission took no action at the time; however, it relayed a commitment to creating a future regional water source. The issues of a constant water source, regulatory obligations, persistent best practices in watershed conservation, delivery of water to the City, examining the needs of other communities in the region and the cost to do all of the above would be items of continued focus for the McMinnville Water and Light Commission into the next century.[xxvii]

As the new millennium approached, McMinnville’s residents, business enterprises and industries still benefitted from some of the lowest electricity rates in the United States. The combined sixty dams in the Columbia River System had generated 50 to 65 percent of the region’s hydroelectric power for more than 25 years. Besides their use for power generation, the dams tamed the river, providing flood control, irrigation options, navigation, and a water supply for residential, agricultural and industrial consumers. Wildlife lived nearby and fish inhabited the river, the latter using it as a super migration highway to and from the Pacific Ocean. The river basin told a geological and natural history, and held the ancient stories of the native people inhabiting the Columbia River region. In addition to all these things, the river also served as home to recreational activities like fishing and sailing. Coordinated operational efforts by agencies and organizations took into consideration the diverse interests of river users while also meeting a wide spectrum of regulations set in place to protect the river, its inhabitants and its cultural resources.

Still serving in its marketing role of selling power generated from the river, funding certain fish and wildlife programs became BPA’s obligation with the enactment of the 1980 Northwest Power Planning and Conservation Act. In 1995, after reviewing data collected under the Endangered Species Act (ESA) of 1973, the three Columbia River System agencies (USACE, the United States Bureau of Reclamation and BPA) undertook a multi-year study of environmental issues and operational matters relative to the System. The results of the study became the Columbia River System Operation Review, which led to renewed agreements across the region, including the Columbia River Treaty between the United States and Canada. The three agencies adopted new and updated operating strategies for the System focused on supporting the recovery of fish species living in the Columbia River Basin listed under the ESA, as well as non-listed species. This became the Coordinated Columbia River System.[xxviii]

Since signing its original 1940 contract with BPA, the McMinnville Water and Light Commission monitored and updated agreements with the agency for power through contract amendments. In late November 1997, Engineering Manager Robare presented information about the 1997 Agreement for Hourly Coordination of Projects on the Mid-Columbia River. Robare explained a bit of the history behind the Mid-Columbia projects and the coordination agreement in place since the early 1970s, whereby BPA conducted the coordination on behalf of McMinnville Water and Light. Robare stated that the Mid-Columbia projects consist of five dams, including the gigantic Grand Coulee. Due to its size, Grand Coulee’s holding or letting out water had a direct impact on all downstream users. In order to run the other projects’ power generation efficiently, and to benefit fish, navigation, flood control and other Columbia River uses, coordinated efforts were necessary. Robare also mentioned that the Mid-Columbia River Projects were rapidly becoming a trading hub for power exchanges throughout the western United States and that McMinnville Water and Light benefits from maintaining its presence. Following Robare’s presentation, the Commission unanimously passed Resolution 1997-20, approving the 1997 Agreement for the Hourly Coordination of Projects on the Mid-Columbia River.[xxix]

The OMECA contract and conservation funding ran out in October 1997 and Conservation Manager David Christie looked for ways to continue efforts in this regard beyond that time. In August 1997, he reported that the utility met the OMECA target savings of five average megawatts, and thus qualified for a bonus of $60,000. In October, the Commission adopted the Conservation Service Loan Program Administrative Rules, as presented by Christie and Commission Attorney Dave Haugeberg. The following January, General Manager Harshman reported the first application for a conservation service loan. McMinnville Water and Light staff worked diligently on amendments to the administrative rules with the plan to rebuild the conservation program, thoroughly establishing it prior to the implementation of legislation, which would mandate such a program. The Commission unanimously adopted the amended rules at its February 1998 meeting, and during the same meeting approved the first Conservation Loan Agreement for $2,740, with many more to follow over the next several months. The utility also moved forward with its self-funding conservation program in March, when the Commission approved the Appliance and Non-Appliance Rebate Incentive Program Administrative Rules. In May, it furthered the utility’s effort by approving the McMinnville Water and Light Residential and Commercial / Industrial Cash Incentive and Rebate Program (RCICRP) Administrative Rules and its implementation subject to available funds.[xxx]

Sowing the Seeds of Connectivity: McMinnville’s Fiber Optics

In November 1997, the Water and Light Commission met in a joint work session with the McMinnville City Council and School Board to address several events taking place simultaneously, which offered the three entities an opportunity to work together. McMinnville was renegotiating its franchise agreement with TCI Cablevision, and the School District had recently received voter approval to upgrade telecommunications and related infrastructure. The Water and Light Commission, City Council and School Board members all agreed to study the issues and set a date for recommended action by March 1, 1998. These discussions led to a new infrastructure opportunity that would expand McMinnville Water and Light’s public responsibilities into new territory. In early 1998, General Manager Harshman reported on the negotiations with the School District and the City concerning a possible fiber optics network ring around the City. He stated that the key issue needing resolution was how to manage the network. City ownership was not an issue; and an agreement was limited to the three entities (Water and Light, the City of McMinnville and School District 40). The School District would receive an allocation of 12 fibers for its use, with the understanding that they would not sell, lease, or license them. In February, Frank Nelson, representing the McMinnville Community Telecommunications Citizen’s Committee (MCTCC), appeared before the Commission to inquire about the possibility of fiber optic network use by the entire community – beyond the City and School District – including residences and businesses. By March, draft agreements with the City of McMinnville and School District 40, as well as a Memorandum of Understanding with the City of McMinnville were underway. Commission Attorney Haugeberg reported that the project required the installation of a cable backbone to meet the School District’s needs by September 1. He described the cable backbone as Phase One of the project, for which McMinnville Water and Light would spend between $200,000 and $300,000, and contribute the required pole space for the new system. Phase Two, while not yet defined, involved the types of issues discussed through the MCTCC, which required more planning and greater funding. On June 29, 1998, the McMinnville City Council approved the Fiber Optics Telecommunications Agreement between the City and McMinnville Water and Light. The agreement set a goal and understanding about establishing the system backbone, with the City paying half the cost. The agreement provided 12 strands of fiber dedicated to School District 40, a second group of 12 strands for use by the City, a third group of 12 strands dedicated to McMinnville Water and Light and the remaining 108 strands of “dark fiber” undedicated until the completion of a Phase Two study. With that understanding, the Commission unanimously approved the Fiber Optics Telecommunications Agreement between the City and its municipal utility.

The next step involved preparing and requesting bids for the project, which resulted in GTENW coming in as the lowest bidder at $950,755. The three contractual entities would split the cost, with the School District paying $517,767.75; the City contributing $216,987.25 and McMinnville Water and Light the remaining $216,000. It actually took four contracts to launch the project. The first was the Fiber Optic Telecommunications Agreement between the City and the utility, discussed above. It provided the foundation for entry into the project and delegated telecommunications system authority to the utility. This agreement also laid the foundation for Phase Two of the project and set future negotiations between the utility and the City for the year 2000. The direction for coordination and integration relevant to system maintenance for the Fiber Optics System came from Letter of Agreement Number One. The third document, known as the Intergovernmental “190” Agreement, presented the understanding agreed to by McMinnville Water and Light and School District 40. Finally, the contract with GTENW created the fourth document involved in the creation of McMinnville’s Fiber Optic System. The Commission could not sign a contract with GTENW until it formally executed the previous three agreements. On September 2, 1998, the Commission passed Resolution 1998-4, executing the Fiber Optic Telecommunications Agreement, Letter of Agreement Number One and the Intergovernmental “190” Agreement. The Commission also passed Resolution 1998-5, which authorized the contract with GTENW for the construction of the 144-strand fiber backbone around McMinnville.[xxxi]

Watershed and Dam Projects: Navigating Natural Challenges

Work began on the watershed’s diversion system during the winter of 1997-98 and continued into the spring. An ice storm in January 1998 brought heavy damage to the Haskins Creek area, resulting in needed road repair work. Water Superintendent Abrams reported that Link Reservoir had been draining at a rate of two-feet-per-day; however, with the storm and the following heavy rains, the water level rose nearly eight feet in 24 hours before receding again. Abrams also commented on the storm damage around the Water Treatment Plant, which operated on its generator for almost five days. Electric Superintendent Greg Gardner reported on ice-storm-related outages, stating that many employees other than the line crew helped by answering customer phones calls, clearing trees and other debris. In February, the Commission approved additional work on the part of Murray, Smith and Associates because of a direct request by the Oregon Water Resource Department. The work involved taking bore samples from Link Impounding Dam for analysis and evaluation to determine a possible further need for seismic evaluation. After listening to Water Superintendent Abrams explain the complicated timing of the Link Impounding Dam and diversion project and the need to progress quickly, the Commission authorized staff to undertake the bore sample process, waiving procurement obligations under Oregon law due to the tight timeline and emergency the request caused. By the spring of 1998, MSA had completed its engineering work on the diversion structures and Engineering Manager Robare requested and received permission to seek bids for the construction portion of the project. In late June, the Commission heard from Attorney Walt Gowell (standing in for Attorney Haugeberg) about two easements near McGuire Dam requested by the BLM. The efforts involved relocating a portion of road in deteriorated condition and wetlands mitigation inside the land requested for the new BLM roadway.

“We were required to mitigate and create three acres of wetland for every one destroyed,” noted Commission Chair Tom Tankersley. “The Army Corps of Engineers and Oregon Department of Lands used a calculation of wetlands occurring naturally around the reservoir and added the creation of more wetlands.”

In exchange for a cooperative agreement relating to relocation and easement efforts, McMinnville Water and Light gained the land rights needed to proceed with the McGuire Dam improvement project. The diversion project gained steam in early 1999 when the Commission reviewed incoming proposals with MSA’s David Leibbrandt. Considering all bids and listening to Leibbrandt’s recommendation, it authorized a $752,734 contract with low bidder Arlyn Davis Construction to conduct the diversion project work. Progress continued on the McGuire Dam project with the application and issuance of a conditional use permit from Yamhill County, and a meeting with the Oregon Department of Fish and Wildlife (ODFW) regarding fish passage issues at the dam. Engineering Manager Robare suggested the creation of resting pools, to serve as steps in an area of steep terrain and rapid flowing water known as the “chute” instead of the ODFW fish passage requirements, which were not practical for McGuire Dam.

“We took it a step further by designing a natural ladder so fish could spawn in areas where, previously, there was no spawning, ultimately improving habitat and wildlife,” Commissioner Tankersley recalled.

In March 1999, the Commission authorized General Manager Harshman to attend an ODFW meeting in Pendleton to present a request for waiver through a Memorandum of Understanding (MOU), which committed to the resting pools as the best solution for fish traveling the Nestucca River. Upon approval of the MOU by ODFW, the Commission approved Resolution 1999-7, authorizing the MOU waiver to Fish Passage during its April 20, 1999 meeting.[xxxii]

Water Rate Adjustments

After approving the utility’s 1998-1999 budget, the Commission reviewed staff work on capital improvements and water rates. In September 1998, the Commission heard about four water rate alternatives, which addressed the design and financial issues faced by the utility for providing water services. During a robust discussion on the issue, Chairman Tankersley reminded the Commission of a time when the utility sold water for less than what it cost to produce. Correcting the issue back then, Commissioners decided the practice was not good stewardship of water because it encouraged customers to use more of the precious liquid than what economics said they should use. Thereafter, the Commission presented rates equal to the cost of bringing water to the community, observed revenue forecasts and followed best practices in water industry standards. Discussing the history behind water rate increases, the Commission examined the four rate alternatives, settled on two as viable, and proceeded to schedule a public rate hearing to take place during its October 20, 1998 meeting. The proposed rates included a service charge increase from $5.10 to $5.61; consumption charge increase from $.438 to $.482 per cubic feet, and a discontinuance of the declining block rate for residential users. Thus, customers using more water saw a higher rate increase. These changes would cut the deficit in the Water Department’s operating income; however, they would not bring the department’s operations into a positive cash flow arena. In other words, operationally the increase helped with day-to-day activities but it did not help with needed capital improvements such as raising McGuire Dam. Hearing no objections during the hearing to raising water rates, Mayor Gormley closed the hearing and the Commission approved the increased rate structure through Resolution 1998-7.

In January 1999, the Commission considered a suggestion from General Manager Harshman for increasing the utility’s annual timber harvest from four to six million board feet, noting that the increase would be of a temporary nature to provide adequate financing of the McGuire Dam project. A discussion brought out the points of timber harvest conservation and water quality issues, but Commissioners saw the practicality of the proposed increase and directed MBG’s Bill Davidson to study the issue. A few months later, the Commission approved several amendments to MSA’s engineering contract at a cost of $786,000. It also heard updates from MSA’s David Leibbrandt on the McGuire Dam project, including fish passage mitigation at the “chute”, the BLM Road relocation, and threatened and endangered species issues. Tillamook County staff, Commissioners and residents presented safety issue concerns related to McGuire Dam a few months later.

“The failure of the Meadow Lake dam took place in late 1964 during the Christmas Flood,” former Mayor Ed Gormley later recalled. ”Tillamook County was very concerned about the possibility of another flood.”

The utility worked with the USACE and Tillamook County on three issues: a dam failure study, alert warning system and emergency action plan. With the Commission‘s authorization, General Manager Harshman outlined the issues and the utility’s plans to address them in a cover letter titled, “Agreement in Principle as to McMinnville Water and Light Proposed McGuire Reservoir Expansion, Dam Safety and Emergency Preparedness Measures”. He attached an MOU to the letter, which provided details of the three issues, and presented the documents to the Tillamook County Commission.

“We overcame and resolved their concerns by installing a siren, which will provide advance warning if the McGuire Dam and Reservoir should ever fail,” Gormley said. “The dam also has earthquake sensors that appeased many people. The utility listened to many people with valid concerns, who testified against the permits for McGuire Reservoir’s raising, and resolved every issue, sometimes exceeding expectations.”

Other potential delays to the McGuire Dam project cropped up in late 1999 relevant to wetlands mitigation. Overcoming this issue, the Commission authorized the $375,000 acquisition of a 160-acre farm on the Little Nestucca River for wetlands mitigation purposes.[xxxiii]

Nearing the end of the decade and the century, McMinnville’s watershed still provided its residents and businesses with great water. Due to conservation measures and proactive planning, and even with the rate increases, McMinnville water consumers paid half the rates of neighboring communities in 1998, as illustrated in the table below.[xxxiv]

During a public hearing held on October 19, 1999, the Commission considered two options for an additional rate increase. The first was a rate increase of approximately .53 cents per 1,000 cubic feet. The alternative was the introduction of a meter charge instead of the traditional customer charge, with rates depending on meter size. After a short discussion and the understanding that either alternative would cover the forecasted water operating budget, the Commission asked General Manager Harshman for his recommendation. Considering the trend toward the use of meters by other water districts in the region, Harshman recommended going with meters as the way of the future even though the change would involve rate schedule changes, including new definitions for accounts with multiple services, such as apartments. Hearing no objections by those in attendance at the public hearing, the Commission approved the change to water meters with the new rate schedule as illustrated in the table below.[xxxv]

Maintaining High Water Quality and Customer Confidence

Water Superintendent Abrams provided the Commission with copies of the new McMinnville Water and Light Consumer Confidence Report (CCR) during a meeting late in 1999. Staff distributed the CCR by mail to every household and business in McMinnville, as well as libraries and other public gathering places. With testing conducted by the Oregon Department of Environmental Quality and the Oregon Health Authority as required by the Federal Safe Water Drinking Act, the annual assessment identifies potentially contaminated sources used for drinking water.

Commenting on the Federal Safe Water Drinking Act regulations, Water Superintendent Abrams said, “Implementing the regulatory processes was an expensive challenge, but the overall results brought safer procedures for delivering clean water to the utility’s customers. The industry’s regulations kept changing, but those changes improved the overall quality of the product.”

Winning numerous awards for “Best Tasting Water”, McMinnville Water and Light’s water system gained the “Outstanding Provider” designation by the State of Oregon Drinking Water Program in late 1999. Published annually, the colorfully illustrated McMinnville Water and Light Water Quality Report contains a bit of history about the watershed, water quality information, quick facts about the water system, water quality test result data, a glossary of terms, water conservation tips, interesting information about the effects of contaminated water and what to do about water pressure, and user rate comparisons.[xxxvi]

Increasing Complexity in Power Procurement: Preparing for the Future

In 1998, BPA began working on a subscription system for future power allocation beginning that November. BPA provided power purchasers the opportunity to comment on the process in September and October. Commission Attorney Haugeberg networked with various industry contacts to learn more about the subscription process and, as a result, recommended that the Commission notify BPA of its interest for future power purchases. Looking 20 years ahead and with the express desire to continue receiving power through Bonneville, the Commission adopted Resolution 1998-6, which authorized General Manager Harshman to initiate discussions, negotiate a power sales contract for 2001 through 2006 and bring it back to the Commission for approval. Of note here, is the fact that the Commission and utility staff did an amazing job of negotiating and tracking all of the contracts with various power brokers, as the contract process became increasingly complicated. With this in mind, the reader should not confuse this resolution with the contract negotiated by OURCA, which also applied to the 2001 through 2006 period. During the Commission’s October 1998 meeting, Engineering Manager Robare explained BPA’s strategy of placing the business risk on its customers, and that other utilities felt uneasy with the new process, especially with rate pricing unknown until January or February 1999. Issues discussed during the meeting included whether or not the subscription system complied with the Northwest Regional Power Act and the perceived threat of the definition of preference for public utilities; concern over the inflexibility of power contract arrangements; and the lack of pooling.[xxxvii]

OURCA changed from a trade organization to an intergovernmental agency in the early summer of 1999. With approval by the Commission, McMinnville Water and Light joined other member utilities in the new Oregon Utility Resource Coordination Association Intergovernmental Agency (OURCAIA). General Manager Harshman explained that utilizing OURCAIA provided flexibility in economies of scale for power purchases and acquisitions. In addition to its other activities that summer, the Commission voted unanimously to authorize staff to enter into the hedging program process when purchasing indexed products from BPA. This process allowed the utility to adjust, reduce and mitigate the negative effects of possible market movements.[xxxviii]

Expanding the Fiber Optic Network: New Opportunities and Challenges

The Water and Light Commission met in joint session with the McMinnville City Council on May 25, 1999 and accomplished two things. First, the City Council approved the appointment of Linfield College President Dr. Vivian Bull to the McMinnville Water and Light Commission, replacing Commissioner Yocom who resigned after seven years of service as a McMinnville Water and Light Commissioner. Dr. Bull became the first woman to serve on the Commission. Although she began attending Commission meetings in June to become familiar with utility issues, her term of service did not begin until September, allowing Commissioner Yocom to finish his work on the McGuire Dam project.

The second item addressed during the joint meeting related to possible continued work on the City’s fiber optic network. As discussed previously, Phase One of the fiber optic network involved a partnership between School District 40, the City and the utility for installation of 23 miles of fiber, creating a 144-strand fiber backbone around the City. Under consideration was a City staff recommendation for a joint venture between the City and McMinnville Water and Light to conduct a Phase Two feasibility study, with the latter taking the lead role. The study would examine the potential of connecting every home in McMinnville with fiber or copper wire. City staff explained that the utility was the obvious choice to build and run the system as it owned the poles and could utilize it for meter reading purposes. Members of both bodies discussed the positive and negative aspects of Phase Two, including potential PUC oversight if the City and utility controlled information that flowed through the fiber. There was also potential for the City and utility to lease out the “dark” (unused) 108 strands of fiber, which would not require the PUC permitting process. Further discussion covered possible conflicts of interest for the City as fiber optic network operator (it would be both provider and regulator) and the fact that the utility could not use its enterprise funds for general purposes. City Councilors and Water and Light Commissioners also talked about the need for marketing research on leasing of dark fiber to outside businesses and / or the development of a retail fiber business. City Manager Kent Taylor noted the Phase Two issues involved technical, financial and political aspects, including the question of a municipality running a fiber optics-related business. City Attorney Clifton Ross drew a parallel between the fiber optic network and the creation of the municipal utility, which was not without controversy.

After a vigorous discussion, the joint meeting of Councilors and Commissioners resulted in a consensus to move forward with the feasibility study for Phase Two of the Fiber Optic Network. The RFP advertisement for a Telecommunications Market Entry Strategy study resulted in the receipt of 14 proposals by the deadline of July 16, 1999. After reviewing the proposals, General Manager Harshman and Lloyd Lowry from the City recommended the $69,199 proposal of Stanley Consultants for consideration by the Commission. Moving forward in the process by requesting an interview with the firm before making a final decision, the Commission eventually hired it to conduct the study. Reporting on behalf of Stanley Consultants during the Commission’s December 1999 meeting, Dan Mills stated his firm had nearly completed collecting information for the study and planned to deliver the written results by February 29, 2000. Mills spoke of four possible scenarios to run the fiber optic system, various market trends and what the Commission could expect to find in the final report.

“The Commission carefully examined the entire issue from creating the network backbone to the possibility of carrying fiber to each customer’s home and business,” Commission Chair Tom Tankersley later recalled. “It was going to be very expensive.”

During a meeting held in June 1999, Patrick Fuchs, president of OnlineMac, a local Internet Service Provider (ISP), expressed a desire to lease dark fiber from the utility, which would enable his company’s ability to bring Internet access to homes and businesses in McMinnville through broadband. Fuchs further stated that he wished to conduct a trial effort to evaluate the demand for broadband Internet access. The Commission considered the proposal and agreed to provide the opportunity for a temporary, pilot project on a trial basis, which would include the dark fiber lease and pole attachment agreements. In July, another local ISP, Valley Internet Company represented by Rommel Raj, conveyed an interest in leasing some of the dark fiber and pole attachments to provide service to its customers and the Commission suggested they consider a trial run similar to OnlineMac. Finally, in September 1999, Jeb Bladine of Pacific Wave Communications requested a short term, two block, pole attachment agreement for four or five poles. A similar request came in from OregonTel around the same time.[xxxix]

The Challenges of Power Negotiations and the Future of Expansion

In August 1999, General Manager Harshman proposed hiring power sales specialist Paul Koehler to conduct a scope of work over a term of 12 to 15 months and assist the utility with BPA contract negotiations, contractual relationships with industrial customers and bulk-power purchase decisions. He also proposed the same scope of work for consulting engineer Rex Brown, who had conducted 12 engineering projects over a five-year period for McMinnville Water and Light. Considering the need for expertise in power sales and electrical engineering, the Commission approved the scopes of work for both Brown and Koehler.

During its October 1999 meeting, General Manager Harshman informed the Commission about FERC disputes with two Grant County owned dams on the Columbia River: Priest Rapids and Wanapum Dam. Commission Attorney Haugeberg elucidated on the issue, advising the Commission about FERC’s ruling that the Purchasers’ Group, which included McMinnville Water and Light, was entitled to 30 percent of the output of the projects at market rates. The Washington, D. C. Circuit Court of Appeals affirmed this ruling. Haugeberg explained the history of the ongoing disagreement over what the terms and provisions of McMinnville Water and Light’s contracts with Grant County meant relevant to rights of the purchasers of Grant County power as the utility approached its next renewal. In addition, third parties that didn’t get any of the Grant County power in the 1950s brought a lawsuit to allege that they were entitled to part of the output of the inexpensive hydroelectric power from the two Grant County dams. McMinnville Water and Light’s Priest Rapids contract was for 50 years starting in 1955 and the Wanapum contract was for 50 years beginning in 1959. The renewal years of 2005 and 2009 were approaching and the Commission would hear more about these issues in the near future. The issue at hand during the December 15, 1999 meeting was a confidentiality agreement, which enabled the utility to participate in purchasers’ group discussions and negotiations at contract renewal time. Not participating would place the utility and its customers at a disadvantage with regard to future low cost power. The Commission authorized the execution of the confidentiality agreement with an eye to the future.

The City of McMinnville and its municipal utility saw tremendous expansion during the decade of the nineties and the future promised continued growth. Closing out the year, decade and century, the Commission considered the addition of a new substation on Baker Creek Road and authorized the collection of bids for a substation transformer to address the City’s present and future demand for electricity. It also continued its work on the McGuire Dam and diversion projects, considered regional water sources and related issues, and worked toward a resolution on Phase Two of the City’s fiber optics network.[xl] At Your Service Since 1889 (1889-1989) 125 Years of Reliable Power, Clean Water, & Excellent Customer Service (2000-2014)