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no longer in business but he did not think it was large relative to the volatility EWEB had seen in <br />its retail loads. Hynix was a significant load, even through its shutdown and retooling. He added <br />that the shutdown of Weyerhaeuser's number one paper machine cost EWEB some generation in <br />June 2001. <br /> <br />Mayor Torrey asked if BPA's agreements with the aluminum plants could be modified to put the <br />plants back on line. Mr. Berggren did not know. He said that there was a regional debate <br />occurring now, with all major customer classes of BPA, including investor-owned and public <br />utilities, in negotiations to determine the future relationship of the aluminum companies to the <br />BPA, and what obligation BPA had to serve them. He added that information he had seen <br />indicated that aluminum smelters in the northwest were antiquated, inefficient, and, in the long- <br />term, "dinosaurs." He did not anticipate that aluminum production would be a major part of the <br />northwest economy in the future. <br /> <br />Mayor Torrey asked Mr. Berggren what he thought would happen with electricity deregulation at <br />the State level. Mr. Berggren responded that the State was in the process of implementing its <br />deregulation bill, which took effect on April 1, 2002. He said that electricity deregulation in Oregon <br />was very different than that embarked on by California. EWEB had supported the State legislation <br />because of it was able to secure guaranteed payments for Iow-income customers, conservation, <br />and renewables. In addition, the bill did not affect publicly owned utilities, leaving local control in <br />Eugene with the board. <br /> <br />DeeAnn Hardt of the Finance Services Division provided an overview of the financial status of the <br />City's General Fund. She reviewed the impact of Ballot Measure 50 on Eugene's property tax <br />revenue, forecasted property tax collection rates, the impact of Hynix revenues on the General <br />Fund, and noted EWEB's wholesale and retail contribution in lieu of taxes (CILT) for electricity. <br />She noted the reduction in current forecasted ClLT dollars since last fall's forecast. Ms. Hardt <br />reviewed the uses to which ClLT wholesale moneys had been put, which included payment on a <br />court-ordered land use claim award and seeding a Facilities Reserve for downtown City space <br />needs. <br /> <br />Ms. Hardt also noted the impact of Qwest's decision to stop honoring its franchise agreements <br />with Oregon cities. <br /> <br />Ms. Hardt discussed the impact of inflation, wage adjustments, and health care and retirement <br />costs on the General Fund. <br /> <br />Ms. Hardt provided a base case forecast of General Fund revenues and expenditures through <br />fiscal year 2008, and also discussed the Eugene Budget Committee's adopted strategy to address <br />the projected shortfall. <br /> <br />Ms. Hardt noted a series of downside budget risks that could have a further detrimental effect on <br />the City's forecast. She invited questions. <br /> <br />Mr. Barrel asked what the City intended to do regarding Public Employee Retirement System <br />(PERS) pooling. Ms. Hardt said that the City had chosen to not pool yet. The City was focused <br />on becoming more fully funded on its own, which had some of the advantages of being in the <br />pool, and would consider in the future whether it wished to join the pool to stabilize rates. <br /> <br /> MINUTES--Eugene City Council February 25, 2002 Page 5 <br /> Work Session <br /> <br /> <br />