A REGULAR MEETING TRAVERSE CITY LIGHT AND POWER …

A REGULAR MEETING

Of The

TRAVERSE CITY LIGHT AND POWER BOARD

Will Be Held On

Tuesday, November 9, 2021

At

5:15 PM

In The

COMMISSION CHAMBERS

(2ND floor, Governmental Center)

400 Boardman Avenue

Traverse City Light and Power will provide necessary reasonable auxiliary aids and services, such as signers

for the hearing impaired and audio tapes of printed materials being considered at the meeting, to individuals

with disabilities at the meeting/hearing upon notice to Traverse City Light & Power. Individuals with

disabilities requiring auxiliary aids or services should contact the Light and Power Department by writing or

calling the following.

Jennifer St. Amour

Administrative Assistant

1131 Hastings Street

Traverse City, MI 49686

(231) 932-4543

Traverse City Light and Power

1131 Hastings Street

Traverse City, MI 49686

231-922-4940

Posting Date:

11/5/2021

3:00 P.M.

Page 1 of 109

Light & Power Board November 9, 2021

Regular Meeting

AGENDA

Page Pledge of Allegiance

1. Roll Call

2. Disclosure of Recusal

3. Consent Calendar

The purpose of the consent calendar is to expedite business by grouping non-

controversial items together to be dealt with by one Board motion without discussion.

Any member of the Board, staff or the public may ask that any item on the consent

calendar be removed therefrom and placed elsewhere on the agenda for full

discussion. Such requests will be automatically respected. If an item is not removed

from the consent calendar, the action noted in parentheses on the agenda is approved

by a single Board action adopting the consent calendar

a. Approval of Agenda

b. Consideration of approving minutes of the Regular Meeting of October 12,

2021 and minutes of the Special Meeting of October 26, 2021. (Approval

recommended) Regular Board - Oct 12 2021 - Minutes

Special Meeting - Oct 26 2021 - Minutes

4 - 11

c. Consideration of approving an amended Capitalization Policy. (Approval

recommended) (Myers-Beman) Capitalization Policy

12 - 19

d. Consideration of approving an amended Purchasing and Contracting Policy.

(Approval recommended) (Myers-Beman) Amended Purchasing and Contracting Policy

20 - 29

e. Consideration of approving an Interagency Agreement with the City of

Traverse City. (Approval recommended) (Myers-Beman) Interagency Agreement

30 - 39

f. Consideration of authorizing reimbursement to Wolverine Power Supply

Cooperative for Grand Traverse Substation #1 Transformer repair. (Approval

Recommended) (Chartrand) Grand Traverse Substation #1 Transformer Repair

40

g. Consideration of approving long lead time material purchases for Barlow to

Parsons Transmission Line Project. (Approval recommended) (Chartrand) Long Lead Time Material Purchase for Barlow to Parsons Transmission Line

Project

41

h. Consideration of accepting EGLE Grant for Electric Vehicle Charging Station

Network. (Approval recommended) (Hardy)

42 - 57

Page 2 of 109

EGLE Grant 4. Unfinished Business

a. Consideration of approving a Consultant Agreement for an Integrated Resource

Planning service with 1898 & Co. a part of Burns and McDonnell. (Myers-

Beman) Integrated Resource Plan

58 - 59

5. New Business

a. Consideration of approving the Kalkaska Combustion Turbine Operating

Agreement with MPPA. (Myers-Beman) Kalkaska Combustion Turbine Operating Agreement

60 - 90

b. Consideration of approving an additional three days off for staff appreciation

between Christmas and New Year's. (Schroeder/Myers-Beman) Staff Appreciation - Three Additional Paid Days Off

91 - 93

6. Reports and Communications

a. From Legal.

b. From Staff.

1. FTTP Update (Menhart/Myers-Beman)

FTTP Update

94 - 99

2. 2022 Six Year Capital Improvement Plan (Myers-Beman)

2022 Six Year Capital Improvement Plan

100 - 108

3. Update on MPPA Projects (Myers-Beman)

Update on MPPA Projects

109

c. From Board.

1. Executive Search Process Update (Heiberger)

7. Public Comment

a. General Public Comment

8. Adjournment

Page 3 of 109

Draft


Minutes of the Regular Board Meeting Held at 5:15 p.m., Commission Chambers, Governmental Center

Tuesday, October 12, 2021

Board Members Present: Elysha Davila, Ross Hammersley, Amy Shamroe, Tim Werner, Paul Heiberger, John Taylor

Board Members Absent: Maura Brennan

Ex Officio Member Present: Marty Colburn, City Manager

Others: Karla Myers-Beman, Scott Menhart, Kelli Schroeder, Tony Chartrand, Jacob Hardy, Jenn St. Amour, Karrie Zeits (Legal Counsel)

1. Roll Call


None.

3. Consent Calendara. Approval of Agenda b. Consideration of approving minutes of the Regular Meeting of September 14, 2021 and

minutes of the Special Meeting of September 28, 2021.

that the minutes of the September 14, 2021 Regular Meeting and the September 28, 2021 Special Meeting be approved.

c. Consideration of approving the amendment of defining customer in the On-Bill FinanceWork Plan.

that the Board authorize the addition of the definition of customer to the On-Bill FinancingWork Plan. Defined as a separately metered electric account in the name of the recordowner, who is the applicant and borrower, and which is used for residential electric energyto the On-Bill Financing Work Plan and forward to the City Commission for approval.

d. Consideration of approving an Interfund loan from the Electric to the Fiber Fund.

that the Light & Power Board authorizes the addition of Phase 1.1 principal and interestpayment ($181,680) due to the City Economic Development fund on November 1, 2021 tothe Interfund Loan between the Electric and Fiber Fund.

Amy Shamroe moved that as recommended, the Consent Calendar portion of the Agendabe approved. Elysha Davila seconded the motion.

Page 4 of 109

Draft

Yes: Elysha Davila, Ross Hammersley, Amy Shamroe, Tim Werner, Paul

Heiberger, and John Taylor Absent: Maura Brennan

Carried 6 to 0. 4. Unfinished Business a. Consideration of a written attorney-client communication on legal rights and responsibilities

regarding Campbell Coal Plant #3, which is exempt from disclosure by state statute. (Zeits/Myers-Beman) (Possible closed session -5 votes required) The following individuals addressed the Board: Karrie Zeits, Legal Counsel Amy Shamroe moved that the Board enter into closed session immediately following General Public Comment to discuss a written attorney-client communication on legal rights and responsibilities regarding Campbell Coal Plant #3, which is exempt from disclosure by state statute, as amended. John Taylor seconded the motion. Yes: Elysha Davila, Ross Hammersley, Amy Shamroe, Tim Werner, Paul

Heiberger, and John Taylor Absent: Maura Brennan

Carried 6 to 0. 5. New Business

None.

6. Reports and Communications

a. From Legal.

None. b. From Staff. 1. Presentation by Fujitsu on Phase 2 Cost Benefit Analysis

The following individuals addressed the Board: Scott Menhart, Chief Information Technology Officer Anthony Bednarczyk, Practice Leader, Fujitsu

2. FTTP Update The following individuals addressed the Board:

Page 5 of 109

Draft

Scott Menhart, Chief Information Technology Officer

3. OPEB Report The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller

4. MERS Report The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller

5. Presentation of the Budget Schedule The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller

6. June 30, 2021 Financial Statements The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller

c. From Board.

None. The Board entered into closed session at 6:01 p.m. The Board returned from closed session at 7:01 p.m.

7. Public Comment a. General Public Comment

None.

8. Adjournment

There being no objection, Chairperson Heiberger adjourned the meeting at 7:05 p.m.

Page 6 of 109

Draft

Karla Myers-Beman, Secretary LIGHT AND POWER BOARD

Page 7 of 109

Draft


Minutes of the Special Meeting Held at 5:15 p.m., Commission Chambers, Governmental Center

Tuesday, October 26, 2021

Board Members Present: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner, Paul Heiberger, John Taylor

Board Members Absent: Elysha Davila

Ex Officio Member: Marty Colburn, City Manager

Others: Daren Dixon, Karla Myers-Beman, Kelli Schroeder, Tony Chartrand, Jacob Hardy, Karrie Zeits (General Counsel)

1. Roll Call


Ross Hammersley recused himself from item 5 (b).

3. Consent Calendara. Approval of Agenda

Ross Hammersley moved that as recommended, the Consent Calendar portion of the Agenda be approved. John Taylor seconded the motion.

Yes: Ross Hammersley, John Taylor, Maura Brennan, Amy Shamroe, Tim Werner, and Paul Heiberger

Absent: Elysha Davila Carried 6 to 0.

4. Unfinished Businessa. ITEM MOVED FOLLOWING GENERAL PUBLIC COMMENT.

b. Consideration of approving the Executive Director Position Specification.

The following individuals addressed the Board:

Kelli Schroeder, Mgr. of Human Resources & CommunicationsMark Ciolek, Preng & Associates, Partner, Utilities & Power Practice LeaderGary Carlson, Preng & Associates, Engineering & Construction Practice Leader

Page 8 of 109

Draft

Ross Hammersley moved that the Board approves the Position Specification as proposed and amended. Amy Shamroe seconded the motion. Yes: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner, Paul

Heiberger, and John Taylor Absent: Elysha Davila

Carried 6 to 0. 5. New Business a. Consideration of declaring various items surplus.

The following individuals addressed the Board: Daren Dixon, Operations Manager Amy Shamroe moved that the Board authorizes declaring the operations equipment presented as surplus and the subsequent sale of these at auction. Ross Hammersley seconded the motion. Yes: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner, Paul


Carried 6 to 0. b. Consideration of approving an Ad Hoc Committee for the Community Investment Fund.

The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller Amy Shamroe moved that the TCL&P Board approve the creation of the Community Investment Fund Ad Hoc Committee for the purpose of reviewing and evaluating submissions and to determine if the requests should be moved forward to the Board for approval and that the following Board members be appointed to the Community Investment Fund Ad Hoc Committee: John Taylor, Tim Werner, and Amy Shamroe. Tim Werner seconded the motion. Yes: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner, Paul


Carried 6 to 0. 6. Reports and Communications

a. From Legal.

Page 9 of 109

Draft

None. b. From Staff. 1. Report on Utility Billing Issue

The following individuals addressed the Board: Karla Myers-Beman, Interim Executive Director/Controller

c. From Board. 1. Amy Shamroe spoke regarding an October 25th City Commission Meeting item

that passed acknowledging staff appreciation between the week of Christmas and New Year's granting employees additional time off.

7. Public Comment a. General Public Comment

None.

b. Consideration of a written attorney-client communication regarding MPSC Case No. U-21090. The following individuals addressed the Board: Karrie Zeits, General Counsel Amy Shamroe moved that the Board withdraw entering into closed session following General Public Comment to discuss a written attorney-client communication on legal rights and responsibilities regarding MPSC Case No. U-21090, which is exempt from disclosure by state statute, and to waive the attorney-client privilege. Ross Hammersley seconded the motion. Yes: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner,

Paul Heiberger, and John Taylor Absent: Elysha Davila

Carried 6 to 0. Amy Shamroe moved that the TCL&P Board direct staff to enter into MPSC Public Comment the TCL&P Resolution passed at the Regular Meeting of June 8, 2021. John Taylor seconded the motion. Yes: Maura Brennan, Ross Hammersley, Amy Shamroe, Tim Werner,

Paul Heiberger, and John Taylor Absent: Elysha Davila

Carried 6 to 0.

Page 10 of 109

Draft

8. Adjournment

There being no objection, Chairperson Heiberger adjourned the meeting at 6:10 p.m.

Karla Myers-Beman, Secretary LIGHT AND POWER BOARD

Page 11 of 109

To:

TCLP Board

From: Karla Myers Beman - Interim Executive Director/Controller Meeting: Regular Board - Nov 09 2021 Subject:

Capitalization Policy

Through the assistance of the Operation Manager, clarifications were made on the capital asset policy for clearer understanding of the items that are to be capitalized. The largest change to the policy is through additions made under subtitle called Capitalized Assets where items used for the different types of systems are listed out. There were some other few minor adjustments to the policy noted through track changes and included for your review. This item is appearing on the Consent Calendar as it is deemed a non-controversial item by staff. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board

or the public wishes to discuss this matter, other than clarifying questions, it should be placed on the “items

removed from the consent calendar” portion of the agenda for full discussion. If after the Board discussion you

agree with staff’s recommendation the following motion would be appropriate MOVED BY ______________________, SECONDED BY _____________________, THAT THE LIGHT & POWER BOARD APPROVES THE AMENDED CAPITAL ASSET POLICY.

Page 12 of 109

TRAVERSE CITY LIGHT AND POWER TRAVERSE CITY, MI CAPITAL ASSET POLICY Adopted: December 30, 2008 Revised: _________________

The purpose of establishing this policy is:

1. To safeguard the investments of Traverse City Light and Power. 2. To fix responsibility for the custody of equipment. 3. To provide a basis for formulating capital asset acquisition, maintenance and retirement

policies. 4. To provide data for financial reporting. 5. To demonstrate appropriate stewardship responsibility for public assets.

DEFINITIONS

1. Ancillary Costs: costs in addition to purchase or construction costs, related to placing a

capital asset into its intended state of operation. Normally, ancillary costs are included in the cost of the capital assets. Ancillary costs include the following:

a. Buildings and improvements: professional fees of architects, engineers, attorneys, appraisers, financial advisors and similar fees, damage claims, costs of permanently attached fixtures, insurance premiums during construction, interest expense, other related costs incurred during construction and other expenses necessary to place the asset into its intended state of operation.

b. Land: legal and title fees, surveying fees, appraisal and negotiation fees, damage payments, site preparation costs, costs related to demolition of unwanted structures and other expenses necessary to place the asset into its intended state of operation.

c. Machinery, equipment, and other: transportation charges, installation costs, maintenance/warranty contracts and any other normal and necessary expenses required to place the asset into its intended state of operation.

d. Infrastructure: landscaping and any other expenses to place the asset into its intended state of operation.

2. Buildings: walled and roofed structures plus improvements that are permanently attached. This capital asset is recorded at cost including ancillary costs. Land costs are excluded. Building improvements include items that are permanently attached to the structure. Items not included are furniture, movable equipment, carpeting, or other pieces of equipment that are not an integral part of the structure where the allocation of costs for the bulk assets over time are matched to the corresponding benefits generated by the bulk assets.

3. Building improvements: any expenditure that will increase the value of the building extends its useful life or caused a material change in the building’s efficiency or function will be capitalized subject to this policy’s threshold. Improvements shall include but not be limited to sprinkler systems, HVAC systems, electrical systems and etc.

4. Bulk purchases: Bulk purchases of capital assets with unit costs of less than $2,500 may be capitalized as a group.

5. Capital assets: includes any piece of land valued greater than $2,500 which Traverse City Light and Power holds title. Capital assets also include buildings, improvements

Page 13 of 109

other than buildings, construction in progress, easements, infrastructure, machinery and equipment with a value greater than $2,500 and a life expectancy greater than two years.

6. Capital lease: lease with contractual terms transferring to the Department substantially all benefits and risks inherent in ownership of the property. Capital leases are capital assets as long as one of the following criteria applies.

a. Ownership of the leased property is transferred to the Department as a capital lease. b. The lease contains a bargain purchase option. c. The lease term is equivalent to 75 percent or more of the estimated useful life of

the leased property. d. The present value of the minimum lease payments (at inception of the lease),

excluding executory costs (usually insurance, maintenance, and taxes, including any profit thereon) is 90 percent or more of the fair value of the leased property.

7. Construction in progress: capital assets reflecting the cost of construction work undertaken, but not completed that will result in a capitalized asset when completed.

8. Depreciation: systematic allocation of the cost of a depreciable capitalized asset (less salvage value) over its estimated useful life.

9. Donated capital asset: recorded at estimated fair value plus any ancillary costs. 10. Easement: a capital asset that reflects the purchased right to use land without ownership

of the land. This right is considered permanent and inexhaustible therefore nondepreciable. Easements are in perpetuity and transfer with the land if the land is sold.

11. Impairment: a significant, unexpected decline in the service utility of a capital asset. 12. Infrastructure: long lived capital assets that typically are stationary in nature and can be

preserved for a significantly greater number of years than most capital assets 13. Land: real property, excluding buildings, with the title held by the Department including

any ancillary costs, and right of ways. Land is a nondepreciable asset. 14. Land improvements: expenditures that do not produce permanent benefits including, but

not limited to landscaping, fences, parking lots, irrigation systems, general signage, and trails.

15. Machinery, equipment, and other: durable capital assets that are complete in and of themselves and are not permanently attached to a building or land. This asset category includes but is not limited to office equipment and other similar equipment.

16. Vehicles: includes all motorized assets including trailers. CAPITALIZED ASSETS

Any asset that has a cost greater than $2,500 and a life expectancy greater than two years are capitalized by the Department with the following exceptions:

1. Construction in progress is not capitalized until the project assets are is completeuseful. All

projects have to be approved by either thethe Executive Director, Controller, or Department EngineerOperations Manager, System Engineer, or Chief Information Officer that they are complete.

1. 2. Repairs and improvements to an existing capital asset that extend the useful life of the asset,

or improve its capacity or efficiency, or significantly reduce operating costs should be capitalized if the costs are more than $5,000 and extends the assets life expectancy by more than twenty-five percent.

a. Routine repairs and maintenance that help an asset maintain the original useful life are expensed regardless of cost.

Page 14 of 109

3. Any poles and transformers less than the threshold. 4. Distribution System

a. Poles b. Transformers c. Entire spans of overhead conductor d. Underground section of conductor from asset to asset or greater than 600 feet in length e. Entire service from asset to point of delivery f. Meters (capitalized when purchased) g. Padmount equipment (sectionalizing, switch cabinets) h. Conduit (capitalized when purchased) i. Capacitor banks j. Oil or gang operated switch k. Street and area light luminaire l. Vaults used for primary m. Transclosers (OH Transformer located in a transformer) - underground

5. Transmission System a. Poles b. Insulators c. Entire spans of overhead conductor d. Underground section of conductor[ST1] e. Switches f. Conduit g. Pothead

6. Substations a. Transformers b. Reclosers c. Capacitors d. Switches e. Circuit switchers and breakers f. Steel structures and bus work g. Control house and equipment

h. Animal guards during initial installation at substation and if doing a whole circuit. 7. Telecommunications

a. Routers b. Switches c. Battery back-up equipment d. Cabinets e. Cable greater than 600 feet in length f. Assets to point of delivery of service

3. 4.8. The Department may record any asset that is considered sensitive and attractive that Page 15 of 109

falls below the capital asset thresholds above. ASSET VALUATION

Capital assets must be recorded at actual cost. Normally the cost recorded is the purchase price or construction cost of the asset, but also includes any ancillary charges.

Donated or contributed assets should be recorded at their fair market value on the date donated.

ASSET IDENTIFICATION

Immediately upon receipt and acceptance, all inventoriable capital assets of the Department will be tagged, when practical, with a prenumbered Department property tag affixed in a readily identifiable location. Land and other assets that cannot be reasonably tagged are excluded from the tagging requirement; however, they are assigned a property number for tracking in the system.

DEPRECIATON AND AMORTIZATION

The Department depreciates all depreciable capital assets using the straight-line method. The straight-line method is (asset cost + removal cost of assets – salvage value)/assets useful life = annual depreciation. Salvage values will be determined on an asset-by-asset basis. The following ranges are available for asset useful life. These ranges are only guidelines:

Generation plant

Wind turbines 33-50 years Equipment 33 30-50 years

Transmission plant

Structures and improvements 45 years Station equipment 30-50 years Towers and fixtures 50 years Poles and fixtures 30-50 years Overhead conductors and devices 30-50 years Underground conduit 30-50 years Underground conductors and

Devices 30-50 years Roads and trails 60 years

Distribution plant

Structures and improvements 45 years Station equipment 30-50years Poles, towers and fixtures 30-50 years Overhead conductors and

Devices 30-50 years Underground conduit 30-50 years

Page 16 of 109

Underground conductors and Devices 30-50 years

Line transformers 30-50 years Services 30-50 years Meters 30-50 years Installations on customer

pPremises 30-50 years Street lighting and signal

sSystems 20-40 years General plant

Structures and improvements 30-50 years Office furniture and equipment 10 years Equipment 10–20 years

Telecommunications 10-30 years

The cost of assets similar in nature (overhead poles, wires, etc.) may be grouped and depreciated as one group.

On an annual basis the Department is to review the actual useful life of assets and compare it to the useful life assigned to ensure assets are being properly depreciated.

SETTING USEFUL LIFE FOR AN IMPROVEMENT

When entering a useful life for an improvement, the useful life of the original asset needs to be considered. The general rule is that the improvement is depreciated over the shorter of the improvement’s useful life or the original asset’s remaining useful life.

It may be necessary to increase the original asset’s useful life if it is anticipated that the improvement will extend the useful life of the original asset. If the original asset is at the maximum range and accordingly, cannot be changed, record the improvement at its anticipated useful life.

CAPITAL ASSET ADDITIONS

The Department’s Inventory Officer assigned employee is responsible for supervising the addition of assets to the inventory system upon receipt and acceptance. An asset should be reported to the Inventory Officer the assigned employee if items are acquired by regular purchases, lease purchases (see definition above), construction by utility personnel, construction by an outside contractor, resolution/condemnation, donation/contribution, addition to an existing asset, transfer from another department, trade or barter, and annexation. This includes assigning tagging responsibilities to specific individuals as well as developing and implementing Department procedures to ensure that the necessary information is entered into the Department’s capital asset inventory.

Page 17 of 109

CAPITAL ASSET DISPOSITIONS When a capital asset is replaced, transferred or otherwise disposed of, the original cost and accumulated depreciation are to be removed from the capital asset records. If the original cost of the asset is unknown, any reasonable method may be used to record the disposition. Reasonable methods can include not recording any cost or recording an estimated cost.

If there is a disposal to a grouped asset, an average cost should be calculated based on the number of assets recorded in the year divided by the total cost. The same shall be done for the accumulated depreciation. Any gain/loss should be recorded during the year of disposition.

Any asset not considered scrap should be approved for disposal by the Light & Power Board.

When suspected or known losses of inventoriable assets occur, the Department shall conduct a search for the missing property. The search should include transfers to other Departments, storage, scrapping, conversion to another asset, etc. If the missing property is not found:

1. Notify the Executive Director. 2. Have the employee deemed to be primarily responsible for the asset, as well as that

individual’s supervisor complete a signed statement to include a description of events surrounding the disappearance of the property, who was notified of the loss, and steps taken to locate the property.

3. Remove the lost or stolen property from the Department’s capital asset records. PHYSICAL INVENTORY

A physical inventory should be completed annually at least every five years for all assets that are inventoriable. Due to the stationary nature of certain assets (land, infrastructure, buildings, and improvements other than buildings) performing a physical inventory is not required.

The inventory should be well documented and reconciled to the capital asset records. Any changes requested from the inventory made to the capital asset records will require approval from the Executive Director. The changes should consist of:

1. Recording unrecorded capital assets noted during the physical inventory. 2. Conduct a search for missing assets, if they are not found, follow the lost disposition of

assets process described above. In order to ensure objective reporting of inventory items, employees having no direct responsibility (custody and receipt issue authority) should perform the physical inventory.

RESPONSIBILITY OF DEPARTMENT MANAGERS

It is the responsibility of the Department Manager to act as or designate a steward for each piece of property. The steward will become the focal point for questions regarding the availability, condition and usage of the asset, as well as the contact during the physical inventory process.

Someone shouldThe steward will be designated to record the receipt of the asset, to examine the asset to make sure that no damage was incurred during shipment and to make sure that the asset was received in working order.

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The steward is also responsible for arranging the necessary preventative maintenance and any needed repairs to keep the asset in working condition. It is necessary to have a responsible person available for questions that arise during a physical inventory or when someone wants to borrow the asset. The steward ensures that the asset is used for the purpose for which it was acquired and that there is no personal or unauthorized use. In addition, the steward should report any property damage or theft.

RECORDKEEPING REQUIREMENTS

The capital asset record system shalThe asset records shalll contain the following data elements with the system defined where the information is held in ():

1. In-service date: the date the agency takes title to or places the capital asset in service.(GIS and

Fixed Asset Ledger) 2. Asset class: the general category code that the asset will roll up to, such as land, poles,

building, improvements, etc. (GIS and Fixed Asset Ledger) 3. Cost: the total cost assigned to the capital asset. (Fixed Asset Ledger) 4. Amount: the number of assets being capitalized. (GIS and Fixed Asset Ledger) 5. Accumulated depreciation: the total depreciation expense incurred to date for the capital

asset. (Fixed Asset Ledger) 6. Depreciation expense: the total depreciation expense incurred fiscal year to date for the

capital asset. (Fixed Asset Ledger) 7. Disposal date: the date the agency officially relinquishes the capital asset. (GIS and Fixed

Asset Ledger) 8. Fund number: record the number of the fund utilizing/purchasing the capital asset. (Fixed Asset

Ledger) 9. Inventory property tag number: the serial number on the Department property tag affixed

to the capital asset. This is not required for land, buildings, and other capital assets that cannot be reasonably tagged; however, an identifying number will be needed. (GIS and Fixed Asset Ledger)

10. Location: an identification code to indicate where the capital asset is located. (GIS) 11. Useful life: the estimated number of years of use to be received from the capital asset.

This is not required for nondepreciable capital assets. (Fixed Asset Ledger) 12. Serial number: the sequential identification number assigned by the manufacturer. (GIS) 13. Description: a written explanation of what the capital asset is. (Fixed Asset Ledger) 14. Model year: for applicable equipment. This can be included in the description. (Fixed Asset

Ledger) 15. Parcel: a legal description of a specific real property. (Fixed Asset Ledger)

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To:

TCLP Board


Amended Purchasing and Contracting Policy

Included in the board packet is a tracked change version of the TCL&P Purchasing and Contracting Policy, which was last amended on October 13, 2009. This was tabled from the July 2021 meeting as General Counsel had further revisions. Staff amended the policy to recognize the impacts of inflationary costs over time on dollar thresholds when requiring sealed bids versus contracts, providing efficiencies in the purchasing policy along with other improvements. A summary of the changes are below:

1. To incorporate verbiage from the City Purchasing and Contracting Policy regarding process, endorsements, personal purchases, public orders, non-discrimination and cooperative procurement programs. 2. Allow for authorization by the Executive Director to delegate spending limits of the Administrative Team through an Executive Order. 3. Incorporate the ability to allow normal routine software purchases, which require a three year license (ex. Microsoft Office) to be authorized by the Executive Director. 4. Update the allowable service order amount versus using a contract from $25,000 to the threshold of 0.1% budgeted operating expenses. 5. Provide additional guidance on when service and purchase orders are required. 6. Added recommended language from the Green Team regarding Green Purchases.

It is staff's recommendation to approve the amended purchasing and contracting policy. This item is appearing on the Consent Calendar as it is deemed a non-controversial item by staff. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board



agree with staff’s recommendation the following motion would be appropriate MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD APPROVES AS PRESENTED THE AMENDED PURCHASING AND CONTRACTING POLICY.

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Page 1 of 9

Light and Power Department City of Traverse City, MI Adopted: June 10, 1986 Amended: October 13, 2009

PURCHASING AND CONTRACTING POLICY

RESOLUTION ADOPTING RESTATED AND REVISED PURCHASING AND CONTRACTING POLICY

WHEREAS, the Traverse City Light and Power Board has the power to adopt policies governing the conduct of the Traverse City Light and Power Department as it deems advisable pursuant to Traverse City Charter §179(p); and WHEREAS, the Board has the power to enter into all contracts and agreements in furtherance of its purposes pursuant to Traverse City Charter §179(c); and WHEREAS, pursuant to Traverse City Charter §178(a), the Executive Director shall have such authority as stated in the Charter and as delegated by the Board; and WHEREAS, the Traverse City Light and Power Department enters into numerous purchases and agreements for services or a combination of services and goods to be rendered by independent contractors, which agreements are generally of short duration and within the monetary spending limit of the Executive Director; and WHEREAS, it is deemed in the best interest of the utility and its customers to provide an efficient and expeditious method of contracting for purchases and services,

NOW, THEREFORE, BE IT RESOLVED that authority to enter into service contracts, service orders, and make purchases is delegated to the Executive Director, who may execute

such contracts, purchase orders, and service orders without approval of the Board or the signature of the Chairman subject to the following limitations:

1. The purchase order, service order, or contract must be in a total amount not

greater than the monetary spending limitation established by the Board for the Executive Director pursuant to Rule 13 of the Rules of the Traverse City Light and Power Board which is currently one-tenth of one percent (0.1%) of the current budget year total expenses.

2. The purchase order, service order, or contract must be expected to be performed

within one year of execution.

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Page 2 of 9

3. A summary of all service orders and contracts entered into by the Executive Director or his designee shall be submitted on a regular basis to the Traverse City Light and Power Board.

4. The forms for all purchase orders, service orders and all standardized contracts

entered into by the Executive Director or his designee on behalf of the Traverse City Light and Power Department shall be preapproved as to form by General Counsel. Other contracts must be approved as to form by General Counsel before being executed by the Executive Director.

BE IT FURTHER RESOLVED that the authority delegated to the Executive Director or his designee is further governed by the attached Traverse City Light and Power Purchasing and Contracting Policy which is hereby adopted and incorporated here by reference. BE IT FURTHER RESOLVED that all policies and procedures in conflict with this Resolution and Policy are hereby rescinded.

BE IT FURTHER RESOLVED that this policy shall be effective immediately.

I hereby certify that the above Resolution was adopted on October 13, 2009, at the regular TCL&P Board meeting held in the Commission Chambers, Governmental Center, 400 Boardman Avenue, Traverse City, Michigan.

Edward E. Rice

____________________________________ Edward E. Rice Secretary

Traverse City Light & Power Board

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PURCHASING AND CONTRACTING POLICY

A. GENERAL 1. Petty CashProcess. All petty cash purchases shall be approved by the Executive

Director or his designee. Purchasing and contracting for the Light and Power Department (TCL&P) shall be handled in a manner that promotes the best interests of TCL&P while providing a fair opportunity for businesses to participate in the purchasing and contracting process. Whenever feasible TCL&P shall purchase from and contract with responsible Traverse City vendors.

2. Transactions Under $1,000Endorsement. Department Heads or their designees are

authorized to purchase goods or services using TCL&P Purchase or Service Orders, for any transaction under $1,000 and which is expected to be performed fully within one year. No TCL&P employee shall endorse or in any way permit the employee’s name and position or grant permission for use of TCL&P’s name to be used and advertised to support a product or vendor.

3. Transactions of $1,000 or MorePersonal Purchases. Department Heads or their

designees recommending Purchase Orders, Service Orders or contracts that will cost $1,000 or over, but not more than 0.1% of budgeted operating expenses shall, prior to placing an order with a vendor, prepare and submit to the Executive Director a Purchase or Service Order for the goods or services. No TCL&P employee shall make a personal purchase under a TCL&P account. No TCL&P employee shall use TCL&P’s name or their position to obtain special consideration in a personal purchase.

4. Records Public. All specifications, bid documents (after the specified time for bid

opening), Purchase Orders and supporting documents are public records which shall be made available to the public upon request.

5. Non-Discrimination. All Service Orders, Purchase Orders, or contracts shall contain a

clause stating that the parties agree not to discriminate against any employee or applicant for employment with respect to hiring, tenure, terms, conditions or privileges of employment, or a matter directly or indirectly related to employment because of race, color, religion, national origin, sex, age, height, weight, marital status, physical or mental disability, family status, sexual orientation, or gender identity.

6. Default to City. Contracts, Service Orders and Purchase Orders may not be entered into

with an entity or person who is in default to the City or TCL&P. Charter Section 152.

B. PROCEDURE

1. Transactions Under 0.1% or less of Budgeted Operating Expenses. Subject to the terms of this policy, the Executive Director may spend up to 0.1% of budgeted operating expenses any may delegate such spending authority through an Executive Order to TCL&P employees without approval of the Board.

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2. Executive Director Approval. The Executive Director may enter into Purchase Orders, Service Orders and contracts that do not exceed 0.1% of budgeted operating expenses the delegated spending limits which that are expected to be performed within one year of execution except for software license agreements that do not exceed three years, and which have been approved as to form by General Counsel or are on a standardized TCL&P form prepared and preapproved by General Counsel as to form.

53. Transactions Over 0.1% of Budgeted Operating Expenses. The Executive Director,

Department Heads or their designees recommending Purchase Orders, Service Orders or contracts that will cost over the 0.1% of budgeted operating expenses or are to be performed past one year of execution or three years in the case of software license agreements regardless of their amount shall:

(a) Prepare a Purchase Order, Service Order or contract, and a Board agenda

communication with specifications describing the item and submit them to the Executive Director for handling through a Board meeting.the Sealed Bid Procedure described in this policy in the case of Purchase Orders, or contracts that will exceed 0.1% of budgeted operating expenses.

(b) Upon approval by the Board, the Purchase Order, Service Order or contract will

be issued subject to any terms or conditions as approved by the Board. (c) Group purchases and projects will not be subdivided in order to reduce the cost

below the 0.1% criterion.of budgeted operating expenses.

64. Competitive Purchasing Procedure for Transactions under 0.1% of Budgeted Operating Expenses. Department Heads and the Executive Director shall use competitive procedures such as, quotes, written proposals or sealed bids, for transactions which that might be advantageously made through competition suchso that TCL&P receives the best cost/value relationship on a timely basis. Sole source, Emergency, and or standardized items are excluded. The procedure to achieve competition will vary with circumstances of the transaction.

75. Receipt of Goods. Goods received shall be examined upon receipt to detect any damage

or defects and to determine if specifications have been met. If the item is satisfactory, a report shall be completed and returned to the Controller for payment. If the item is unsatisfactory, the Department Head shall affect steps necessary for correction or cancellation of the purchase, as agreed upon with the Executive Director, but in either case, no payment shall be approved until purchase is satisfactory.

86. Completion of Service; Payment. The Department Head shall determine if the service

has been satisfactorily completed and if specifications have been met. If the service is satisfactory, the Department Head shall indicate approval for payment and the Service Order number on the invoice returned for payment.

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97. Service Orders. Service Orders shall be utilized in the procurement of labor or services, rather than only goods, products or materials. If materials are provided in addition to services, a Service Order shall be used for both. The Executive Director shall determine if a service may be obtained through a Service Order or a more individualized contract. A Service Order may not be used for purchase of services of more than 0.1% budgeted operating expenses $25,000 or greater. In such cases, a contract as described herein shall be used. No service should be provided under a Service Order until all insurance requirements of the Service Order are met.

108. Purchase Orders. A Purchase Order should be issued for any purchase greater than

$2,500 or if requested by a vendor. 9. Sales Tax. TCL&P is exempt from local and state sales taxes or federal excise taxes.

The Controller’s office can provide the necessary exemption documents to any vendor upon request.

110. Invoices. Department Heads or their designees shall examine invoices to make sure they

do not conflict with the TCL&P Purchase, or Service Order or contract. 121. Blanket Purchase/Service Orders. Department Heads may issue a blanket Purchase or

Service Order. Blanket Orders shall be used when numerous small purchases or brief services from the same vendor are anticipated. Blanket Orders shall not be used to purchase items that could be more advantageously obtained through competitive bidding.

132. City Treasurer. For purposes of supplying services to TCL&P, the City Treasurer shall

be considered a Department Head. Purchases by the City Treasurer shall be governed by the “City Treasurer’s Purchases on Behalf of Light and Power Policy.”

13. Cooperative Procurement Programs. Documentation shall be retained describing the

cooperative procurement program and stat that such programs have met the requirements of competitive bidding.

14. Inventory. Items designated as inventory will be bid competitively through receiving

quotes on a weekly basis based on the inventory reordering system or when inventory items that a medium/long lead time items are required for a scheduled job/project/task. A weekly order will not be subdivided in order to reduce the cost below the 0.1% of budgeted operating expenses.

C. GREEN PURCHASING

1. Green Purchasing. Green Purchasing is the practice of procuring goods and services

that cause less harm to the environment, and the living beings that depend upon it for survival. Green Products are those manufactured with more environmentally-friendly materials or which are produced with minimal impact to the environment. TCL&P will strive to purchase materials that are:

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• Durable, as opposed to single use or disposable • Non-toxic or minimally toxic, preferably biodegradable • Highly energy-efficient • Recyclable or safely disposable • Made from raw materials obtained in an environmentally sound, sustainable

manner • Manufactured in an environmentally sound manger • The cause of minimal or no environmental damage during normal use or

maintenance • Shipped with minimal packaging (consistent with care of the product), preferably

made of recycled and/or recyclable materials

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BD. SEALED BID PROCEDURE

1. Sealed Bids. Except as provided herein, Ssealed bids are required in all transactions involving expenditures of more than $25,0000.1% of Budgeted Operating Expenses. “Sealed Bid” means a written response to a solicitation which requires public bid opening. Bidders shall strictly comply with submission criteria to protect the integrity of the sealed bid process. It is bidder’s responsibility to ensure compliance with submission requirements. Light and Power The Executive Director may disqualify a bid that does not conform to the submission requirements. Faxed or e-mailed bids are not acceptable.

2. Publication. The Controller shall publish an advertisement for bid in a local newspaper

for at least two days within a week of the request for proposal being issued. 3. Bid Opening. The time and place of the bid opening shall be stated in the request for

bids. Bid opening shall be public. Light and PowerTCL&P may request clarification of a bid from any vendor. No bids shall be accepted after the deadline indicated. Any or all bids may be rejected.

4. Bid Award. The Executive Director shall submit a recommendation to the Board for

approval. After approval by the Board, the Executive Director shall complete the Purchase Order or Contract.

5. Exceptions to Sealed Bids. Sealed bidding shall not be required when the Executive

Director determines that Light and PowerTCL&P will be best served by purchase from or jointly with another unit of government, when an eEmergency exists, or when TCL&P will be best served without obtaining bids, such as for employment or professional services. Sealed bidding may be waived in any transaction by the Board if it determines that it is in the best interest of the utility to do so.

6. Sole Bidders. In the event only one bid is received, the Department Head may

recommend award to the sole bid if the following conditions have been met:

(a) Due diligence has been performed in soliciting bids according to these policies and procedures, and

(b) The bid has been evaluated and determined to be reasonable based on history of

past purchases and evaluation of the market. 7. Disqualification. The bid documents shall include a form requiring certification by the

vendor that none of the following circumstances have occurred with respect to the vendor, an officer of the vendor, or an owner of a 25% or more share in the vendor’s business, within 3 years prior to the bid:

(a) conviction of a criminal offense incident to the application for or performance of

a contract;

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(b) conviction of embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property, or any other offense which currently, seriously and directly reflects on the vendor’s business integrity;

(c) conviction under state or federal antitrust statutes; (d) attempting to influence a public employee to breach ethical conduct standards; or (e) conviction of a criminal offense or other violation of other state, local, or federal

law, as determined by a court of competent jurisdiction or an administrative proceeding, which in the opinion of the City indicates that the bidder is unable to perform responsibility or which reflects a lack of integrity that could negatively impact of reflect upon TCL&P, including but not limited to, any of the following offenses or violations of:

i. The Natural Resources and Environmental Protection Act. ii. A persistent and knowing violation of the Michigan Consumer

Protection Act. iii. Willful or persistent violations of the Michigan Occupational Health

and Safety Act. iv. A violation of federal, local, or state civil rights, equal rights, or non-

discrimination laws, rules, or regulations. v. Repeated or flagrant violations of laws related to the payment of

wages and fringe benefits.

(f) The loss of a license or the right to do business or practice a profession, the loss or suspension of which indicates dishonesty, a lack of integrity, or a failure or refusal to perform in accordance with the ethical standards of the business or profession in question.

In the event that the vendor is unable to certify, the vendor may be disqualified. A disqualified vendor may appeal the disqualification to the Board by written letter to the Executive Director received by either of them within seven (7) calendar days after notice to the vendor of the disqualification. Upon the filing of such an appeal, the contracting and bidding process shall be stopped, or extended as the situation required, in order to hear the appeal.

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CE. EMERGENCIES 1. Emergency Defined. Emergency is defined as a threat to the public safety or welfare, or

where timely action is required to restore electric the services provided by TCL&P or avoid reduction of electric service(s) or an anticipated outage.

2. Executive Director Authority. The Executive Director is authorized to enter into such

Emergency contracts or, pPurchase oOrders and sService oOrders in excess of 0.1% of budgeted operating expenses without Board approval in the amount necessary to alleviate or avoid an eEmergency. The Executive Director may delegate in writing to a Department Head authority to authorize that Department Head to exercise his or herthe Executive Director’s eEmergency authority.

3. Reporting. When the Executive Director engages in an eEmergency transaction beyond

the monetary spending limit of the Executive Director, he shall report such activity as soon as possible to the Board members and place the matter on the agenda of the next regular or special TCL&P Board Meeting for the information of the Board.

Edward E. Rice _______________________________________________

_ Edward E. RiceKarla Myers-Beman Secretary

Traverse City Light & Power Board

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To:

TCLP Board


Interagency Agreement

Staff initially created an interagency agreement that was intended to cover all services between the City of Traverse City and Traverse City Light and Power. It was drafted for the purpose to make clear between the two entities all interdepartmental transactions/services and the associated related costs. After talking with the City Attorney and taking into consideration the amount of time it would take to review the whole agreement, it was agreed upon to initially review the services/attachments for Treasurer/Accounting Services the reviewto continueto intention is remaining ItSeparation. Billing Utility and the transactions/services, which include Garage, Human Resource, Dispatching, Automated Metering Infrastructure, and Miscellaneous Services and bring those forth for approval once completed. General Counsel has reviewed the draft agreement included in the packet along with the City attorney and staff. It is staff’s recommendation for the Board to approve interagency agreement as presented that includes the services of Accounting, Utility Billing, Finance Scope of Services and Utility Billing Separation. This item is appearing on the Consent Calendar as staff deems it to be non-controversial. Staff recommends that the Board approve the consent to assignment. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board or the public wishes to discuss this matter, other than

clarifying questions, it should be placed on the “Items Removed from the Consent Calendar” portion of the agenda

for full discussion. If after Board discussion you agree with staff’s recommendation the following motion would

be appropriate: MOVED BY ______________________, SECONDED BY ________________________, THAT THE LIGHT & POWER BOARD AUTHORIZES THE EXECUTION OF THE INTERAGENCY AGREEMENT.

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MEMORANDUM OF UNDERSTANDING REGARDING

SERVICES PROVIDED BETWEEN CITY OF TRAVERSE CITY AND TRAVERSE CITY LIGHT AND POWER

THIS Memorandum of Understanding (MOU) is made this ____ day of _____________,

2021, by and between the TRAVERSE CITY LIGHT AND POWER DEPARTMENT, a Michigan municipal electric utility, whose address is 1131 Hastings Street., Traverse City, Michigan, 49686, ("TCL&P"), and the CITY OF TRAVERSE CITY, a Michigan municipal corporation, of 400 Boardman Avenue, Traverse City, Michigan, 49684, (the "CITY");

WHEREAS, for some time the City Treasurer’s Department has supplied a variety of services to

TCL&P including utility billing services, and WHEREAS, due to the advancement of technology in certain areas as well as the addition of

services provided to the public such as fiber to the premise, the City and TCL&P have determined that certain utility billing services should continue to be provided by the City Treasurer’s Department and other should be completed by TCL&P, and

WHEREAS, City wishes to continue specific utility billing services provided for by TCL&P as

outlined in the Scope of Services as well does TCL&P wishes to continue specific services provided for by the City as outlined in the Scope of Services; and

WHEREAS, City wishes and has the ability to supply the requested services to TCL&P as well

does TCL&P wishes and has the ability to supply the requested Services to the City; and

WHEREAS, City wishes to reimburse TCL&P for the performance of services as outlined in the

Scope of Services and TCL&P wishes to reimburse the City for the performance of services as outlined in the Scope of Services, and

NOW THEREFORE, pursuant to the Urban Cooperation Act (MCL 124.501 et seq.), the parties mutually agree as follows:

1. Scope of Services. The City and TCL&P shall provide services for each other in accordance with and as set forth in Schedule A, Scope of Services, attached hereto and incorporated herein by reference.

2. Compensation and Method of Payment. TCL&P shall pay to the City and the City

agrees to accept as full compensation for Services under this MOU the total sum of services outlined in Schedule B. As well does City shall pay to TCL&P and TCL&P agrees to accept as full compensation for Services under this MOU the total sum of services outlined in Schedule B.

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3. Period of Performance. The services to be rendered under this MOU shall commence

upon execution hereof and shall continue indefinitely, unless terminated, in whole or in part, as set forth herein, if the expenditure of the funds for the services contemplated herein is approved by the City Commission and TCL&P Board in its operating budgets. The Payroll Allocation provided in Schedule B shall take effect once the billing separation contemplated by this agreement has been fully implemented.

4. Purchases. The City and TCL&P shall purchase the equipment and supplies

necessary to provide the Services outlined in Schedule A called for under the terms of this MOU.

5. Employees. The City and TCL&P each is the employer of the respective departments involved in performing the Services specified under each of the terms of this MOU and has all employer responsibilities. If TCL&P has any complaints or concerns regarding employees of the City, it shall address them to the City Manager, and if the City has any complaints or concerns regarding employees of TCL&P, it shall address them to the Executive Director. There is no transfer of employees between the parties authorized by this Agreement.

6. Independent Contractor. The relationship of the parties is that of an independent

contractor and in accordance therewith, the parties covenant and agree to conduct themselves consistent with such status and that neither they nor their employees, officers or agents will claim to be an officer, employee or agent of the other party or make any claim, demand or application to or for any rights or privileges applicable to any officer or employee of same, including but not limited to worker's compensation coverage, unemployment insurance benefits, social security coverage, or retirement membership or credit. The parties do not intend the services provided under this MOU to be a joint endeavor.

7. No Separate Entity. No separate entity is created by this Agreement.

8. Non-Discrimination. The parties agree not to discriminate against an employee or

applicant for employment with respect to hire, tenure, terms, conditions or privileges of employment or a matter directly or indirectly related to employment because of race, color, religion, national origin, age, sex, height, weight, marital status, physical or mental disability, family status, sexual orientation, gender identity, or genetic makeup. Breach of this covenant may be regarded as a material breach of this MOU.

9. Third Party Participation. This MOU confers no rights or remedies on any third party, other than the parties to this MOU and their respective successors and permitted assigns.

10. Other Services. This MOU does not include all the services provided between the two entities. There are other contracts, policies, and procedures on other mutually agreed upon services that shall remain separate until at the time management believes it is in the best interest to

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incorporate those agreements into this master interlocal government service agreement. Further, each party agrees to utilize resources that are deemed in the best interest of both the City and TCL&P for other services and will determine the due compensation on a case-by-case basis and adopt a written Scope of Services for the new services before services commence unless an emergency situation exists.

11. Amendments. The object of the scope of service schedules is to capture the majority of the services provided by City to TCL&P and vice versa. However, there will be times where this list will not be all inclusive and require the MOU to be modified, and such modifications shall be in writing and initialed by the City Manager and TCL&P’s Executive Director. Only significant deviations or change in monetary compensation shall warrant an amendment to be approved by the City Commission and TCL&P Board.

12. Assignment. The parties agree that there shall be no assignment of this MOU or any

part thereof unless mutually agreed to in writing by both parties. 13. Dispute Resolution. If any party has a dispute with another regarding the meaning,

operation, or enforcement of any provision of this MOU, the disputing parties agree to meet and confer to negotiate a resolution of the dispute. They further agree that if they are unable to resolve the dispute themselves, and before formally instituting any other dispute mechanism, they shall utilize the services of a mutually acceptable neutral mediator, who meets the qualifications of MCR 2.411, to bring them together in at least one mediation session.

14. Venue. All meetings, hearings and actions to resolve the dispute shall be in the

County of Grand Traverse, State of Michigan. 15. Interpretation. This MOU shall be governed by the laws of the State of Michigan,

both as to interpretation and performance. This MOU was drafted at the joint direction of the parties. The pronouns and relative words used herein are written in the neuter and singular. However, if more than one person or entity joins in this MOU on behalf of the parties, such words shall be interpreted to be in the plural, masculine or feminine as the sense requires.

16. State Funds. No funds of the State of Michigan are involved in this MOU. 17. Termination. Either party may in its sole discretion terminate this MOU in whole or

in part except as may be provided in the City Charter. The failure of either party to act in accordance with their respective responsibilities as outlined in this MOU shall relieve the other party of any and all of its responsibilities under this MOU. This MOU may be terminated only after notice and following the dispute resolution provisions contained herein. Termination shall be made by giving ninety (90) calendar days advance written notice to the other party. Such notification shall state the effective date of termination or cancellation and include any final performance instructions or requirements. Unless otherwise agreed by the parties, a partial termination shall be for all the

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services described in an Article of Schedule A. 18. Notice. Whenever it is provided in this MOU that a notice or other communication is

to be given or directed to either party, the same shall be given or directed to the respective party at its address as specified in this MOU or at such other address as either party may, from time to time, designate by written notice to the other.

19. Authority to Execute. The parties agree that the signatories appearing below have the authority and are duly authorized to execute this MOU on behalf of the party to the MOU. IN WITNESS WHEREOF, the parties hereto have executed this Memorandum of Understanding on the date and year first above written. TRAVERSE CITY LIGHT AND POWER DEPARTMENT By: ______________________________ Karla Myers-Beman Interim Executive Director CITY OF TRAVERSE CITY By: ______________________________ Marty Colburn City Manager

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SCHEDULE A

I. ACCOUNTING, UTILITY BILLING, AND FINANCE SCOPE OF SERVICES

The parties agree that the accounting, billing and financial services performed by the City on behalf of TCL&P shall consist of the following: 1. City Treasurer/Finance Director

a. Manage cash and investment portfolio and record transactions reflecting activity b. Provide guidance on an as needed basis for items such as bonding c. Process checks/journal entries relating to the City Fee d. Review accounts payable and payroll checks e. Process 1099 and W-2 reporting f. Manage the accounting system g. All duties listed within the City Charter and City Ordinances that are not

incorporated above

2. Financial Analyst/Compliance Officer a. Reconcile bank accounts that include TCL&P cash accounts b. Perform special projects as requested (additional flat allotment will be agreed

upon) c. Perform year end audit workpapers such as cash and investment schedule

3. Accountant

a. Process miscellaneous receivables invoices through BS&A account receivable system

b. Process payroll checks c. Process report to IRS and other agencies and disbursements d. Upload direct deposit data files to the bank e. Input journal entries f. Perform year end accruals for payroll

4. Accounts Payable Clerk

a. Input accounts payable and process checks b. Perform investigations on status of invoices and statements showing credit

balances c. Process payroll deduction checks

5. Collections Clerk

a. If needed, assist in handling delinquent miscellaneous accounts receivable through the established collection process which may include small claims process and sending them to third party collections and if applicable the lien process

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6. Customer Service Representatives

a. Forward any customer service phone calls regarding utility bills b. Process cash and check payments c. Perform a daily cash reconciliation to allocate funds to the appropriate fund

7. Other

a. Any change in processes, procedures, or documents used will be communicated to the designated contact at TCL&P before implementation to ensure compliance with TCL&P contracts, policies and executive administrative orders.

b. Appropriate access will be granted to TCL&P’s Controller and other designated employees to the human resources module, general ledger, accounts payable, and purchase orders software programs and systems.

II. UTILITY BILLING SEPARATION

The parties agreed it is in both City of Traverse City and Traverse City Light and Power benefit to remove the Electric billing services provided by the City, which includes the duties of billing, customer service, cash receipts and collections. The benefits of separating allow TCL&P to purchase a utility billing system, which provides for a system that can process a complicated tariff rate such as Time of Use while allowing the City to purchase a utility billing system that provides for efficiency through utilization of one software platform. It will allow the ratepayers to receive two separate, simpler, and lower cost bills and provide better customer service to its ratepayers with employees specializing in the services provided under each entity versus all services. The City and TCL&P agree to the following 1. TCL&P will invoice for Electric and Fiber Services and the City will invoice for Water

and Sewer Services with the potential of Stormwater in the future. Each entity will provide billing, customer service, cash receipts and collections for each of their services.

2. Each entity will staff their positions.

3. Each entity will provide a project timeline and in good faith for the benefit of their

ratepayers adhere to the proposed timelines below to provide the ratepayers a clean break from one bill for Electric, Water and Sewer to two separate bills of Electric and Fiber coming from TCL&P and Water and Sewer coming from the City.

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4. Each entity will agree to purchase, install, and operate a customer information platform in the best interest of their ratepayers with each entity hosting their own platform.

5. TCL&P will work with the City in regards to integrating the general journal summarizing the financial activity of the customer information platform on a daily basis into the City’s BSA General Ledger System.

6. The City and TCL&P will work together on a mutually agreed upon communication plan to the ratepayers as to the splitting of the utility billing services.

7. TCL&P will enter into a separate mail processing contract, develop new phone numbers for customer service, and obtain a separate drop box for payments.

8. TCL&P will work with the City in executing a contract for merchant services, obtaining a check scanner, access to the City’s banking website to allow TCL&P to process deposits and verify deposits made into the bank account. Additionally, TCL&P will work with the City in automating bank drafting and return of NSF Checks.

9. TCL&P and City agree to provide access to each other’s utility billing software platform to allow for each entity to receipt in deposits, solely cash and checks, made from ratepayers at each entity’s location. A public computer will be provided to allow for all credit card processing requests located at each entity’s location to be processed through the customer information system online portal. All billing questions will be forwarded to each respective entity.

10. The City will perform sales tax reporting on behalf of TCL&P for sales tax incurred through the billing of Electrical and Fiber services.

11. Each entity may request to place bill inserts or information on the bill of the other respective entity to be used as an additional customer platform.

SCHEDULE B

The payment for services rendered are based on the parties’ fiscal years starting July 1 and ending June 30.

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ACCOUNTING, UTILITY BILLING AND FINANCE SERVICES The payment amount for these services will be based on allocated wages and fringe through a combination of actual time spent and analysis of workload as follows: Customer Service Representatives – based on the previous fiscal years percentage of cash receipts processed for each fund and taking into consideration the removal of work due to the utility billing separation. Utility Collections Clerk - based on previous fiscal years average of past due accounts receivable and current collections efforts (accounts receivable less than 3 months old or less) along with incorporating the amount of hours for time spent on collecting delinquent personal taxes, parking tickets, nonoperating invoices within one payroll period by fund, and taking into consideration the removal of work due to the utility billing separation. Accounts Payable Specialist - based on the previous fiscal years percentage of invoices processed by fund. Accountant – based on previous fiscal years average of journal entries processed, payroll FTE’s, and accounts receivable invoices processed by fund. Financial Analyst/Internal Compliance Officer – based on a set amount of hours for bank reconciliations, sales tax reporting and audit workpapers in a payroll period by fund. City Treasurer/Finance Director – based on a set amount of hours for investing, managing cash accounts, review of disbursements and payroll, 1099 reporting, and W-2 reporting in a payroll period by fund. The percentage allocations should be reviewed and adjusted from time to time, but shall be reviewed at the minimum every five years. Any significant change in workload, processes or procedures shall automatically warrant a review of the payroll allocations. The payroll allocations shall be performed by the City’s Financial Analyst/Compliance Officer subject to review and agreement by the TCL&P Controller.

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The agreed upon payroll allocations are as follows:

Payroll Allocation Position General Fund

(101-253) Electric

(582) Parking

(585) Sewer (590)

Water (591)

Garage (661)

Customer Service Representative 1

22.50% 2.50% 0.00% 37.50% 37.50% 0.00%

Customer Service Representative 2

22.50% 2.50% 0.00% 37.50% 37.50% 0.00%

Customer Service Representative 3/Collections

22.50% 2.50% 0.00% 37.50% 37.50% 0.00%

Accounts Payable Specialist 50.00% 20.00% 0.00% 5.00% 5.00% 20.00% Accounting Clerk 52.50% 25.00% 0.00% 7.50% 10.00% 5.00% City Treasurer 50.00% 10.00% 0.00% 20.00% 20.00% 0.00% Financial Analyst/Compliance Officer

82.50% 5.00% 2.50% 5.00% 5.00% 0.00%

Deputy Treasurer 50.00% 5.00% 0.00% 18.75% 18.75% 7.50% Utility Billing Specialist 0.00% 0.00% 0.00% 50.00% 50.00% 0.00%

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To:

TCLP Board

From: CC:

Tony Chartrand - Systems Engineer Daren Dixon - Operations Manager

Meeting: Regular Board - Nov 09 2021 Subject:

Grand Traverse Substation #1 Transformer Repair

Wolverine Power Supply Cooperative ("Wolverine") found some concerning results upon performing oil testing on the Grand Traverse #1 transformer in September. They retested in October to ensure that the results were valid, and found that the oil had further degraded. After going out for bid Wolverine is proceeding with the transformer manufacturer to come examine the transformer and attempt to repair the unit at an estimated cost of $70,500 (TCL&P's share would be $35,250) plus overhead charges in accordance with the Joint Operation Maintenance Agreement with Wolverine. Unfortunately it is impossible to determine what the issue is without opening up the transformer. Upon inspection they may find that they are unable to repair the transformer in the field. In this case the transformer will have to be sent back to the factory for repair, and staff will return to the board with an estimated cost to do this for your approval. This transformer is critical for the continued reliability of our system, and thus it is important the unit is repaired and returned to service. This item is appearing on the Consent Calendar as it is deemed a non-controversial item by staff. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board or the public wishes to discuss this matter, other than clarifying questions, it should be placed on the “items


agree with staff’s recommendation the following motion would be appropriate MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD AUTHORIZES A PURCHASE ORDER TO BE ISSUED TO WOLVERINE POWER SUPPLY COOPERATIVE FOR 50% OF THE FINAL COST AND OVERHEAD CHARGES TO EXAMINE AND ATTEMPT TO REPAIR THE TRANSFORMER IN THE FIELD PER THE WOLVERINE POWER SUPPLY COOPERATIVE O&M AGREEMENT.

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To:

TCLP Board

From: CC:

Tony Chartrand - Systems Engineer Daren Dixon - Operations Manager


Long Lead Time Material Purchase for Barlow to Parsons Transmission Line Project

Traverse City Light & Power solicited bids for the long lead-time material for the Barlow to Parsons Transmission Line project in order to ensure the items would be delivered prior to the start of construction. Four bids were received with the following results: Vendor Price Notes Power Line Supply $766,821.80 Low bid.

Border States $251,911.15

Incomplete bid, all bid items were more expensive than winning bidder.

Irby $851,122.20

McWane Poles $110,223.90 Just poles, did not quote one pole size.

After review by staff, it is recommended TCL&P accept the low bid and issue a purchase order to Power Line Supply in the amount of $766,821.80. Individual item costs came in both higher and lower than budget, but overall were lower than budget. Please note that the aluminum and copper prices may fluctuate from what was quoted and thus the price may be slightly higher or lower for those items that use those metals. All material quoted is expected to be delivered by the planned start date of construction. This item is appearing on the Consent Calendar as it is deemed a non-controversial item by staff. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board



agree with staff’s recommendation the following motion would be appropriate MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD AUTHORIZES THE INTERIM EXECUTIVE DIRECTOR TO ISSUEA PURCHASE ORDER WITH POWER LINE SUPPLY FOR TRANSMISSION LINE MATERIAL IN THE AMOUNT OF $766,821.80, MORE OR LESS.

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To:

TCLP Board

From: Jacob Hardy - Energy Technician Meeting: Regular Board - Nov 09 2021 Subject:

EGLE Grant

As part of the EV Charging Station network project, Traverse City Light and Power applied for a grant through Michigan’s department of Environment, Great Lakes and Energy (EGLE). (The Board authorized staff to apply

for the grant at the February 9, 2021 board meeting.) On April 9, 2021, TCLP received award notification for equipment and material costs covering up to $173,763.03 of the estimated project cost of $358, 687.74 leaving a match amount of $184,924.71 . This grant will pay for costs associated with installation of all 3 (three) DC Fast Charging stations as well as 2 (two) dual port level 2 stations. Overall TCLP installed 12 (twelve) dual port level 2 charging stations (24 ports) and 3 (three) DC Fast Charging stations (3 port). The first charger was activated in May of 2021 with the last activation taking place on October 15, 2021. The grant agreement start date was amended in Appendix A to the date of the award notification, which is April 9, 2021 allowing for the applicable costs incurred to be reimbursed. (The grant agreement is standardized and all amendments are documented in Appendix A). General Counsel has reviewed the grant agreement. Staff plans on bringing an update on the Electric Vehicle Charging Station Network at the December board meeting. This item is appearing on the Consent Calendar as it is deemed a non-controversial item by staff. Approval of this item on the Consent Calendar means you agree with staff’s recommendation. If any member of the Board



agree with staff’s recommendation the following motion would be appropriate MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD AUTHORIZES THE INTERIM EXECUTIVE DIRECTOR TO ACCEPT THE GRANT AND EXECUTE THE GRANT AGREEMENT WITH EGLE IN THE AMOUNT UP TO $173,763.03 WITH A MATCH AMOUNT OF $184,924.71 FOR THE EV CHARGING NETWORK.

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1

CHARGE UP MICHIGAN PROGRAM VOLKSWAGEN STATE MITIGATION TRUST

2021 GRANT AGREEMENT BETWEEN THE

MICHIGAN DEPARTMENT OF ENVIRONMENT, GREAT LAKES, AND ENERGY AND TRAVERSE CITY LIGHT AND POWER

This Grant Agreement (“Agreement”) is made between the Michigan Department of Environment, Great Lakes, and Energy, (EGLE), Materials Management Division, (“State"), and Traverse City Light and Power ("Grantee"). The purpose of this Agreement is to provide funding from the Volkswagen State Mitigation Trust (VSMT) in exchange for the eligible mitigation actions outlined below and in conformance with Appendix D-2 of the Environmental Mitigation Trust Agreement for State Beneficiaries. A copy of the Environmental Mitigation Trust Agreement for State Beneficiaries can be found on the Fuel Transformation Program website at Michigan.gov/EGLEFTP. This Agreement is subject to the terms and conditions specified herein. Project Name: Charge Up Michigan Program Project #: 21-5V91-024 Amount of grant (VSMT) funding: $173,763.03 Amount of grantee match (subject to change if

VSMT funding is adjusted): $184,924.71 Project total: $358,687.74 Start Date (date executed by EGLE): End Date: March 31, 2022

GRANTEE CONTACT: STATE’S CONTACT: Jacob Hardy, Energy Technician Jessie Crawford, Program Coordinator Name/Title Name/Title

Traverse City Light and Power Materials Management Division Organization Division

1131 Hastings Street P.O. Box 30471 Address Address

Traverse City, Michigan 49686 Lansing, Michigan 48909-7741 Address Address

231-932-4563 517-231-1051 Telephone number Telephone number

[email protected] [email protected] E-mail address E-mail address

The individuals signing below certify by their signatures that they are authorized to sign this Agreement on behalf of their agencies and that the parties will fulfill the terms of this Agreement, including any attached appendices, as set forth herein. FOR THE GRANTEE:

Signature Karla Myers Beman, Interim Executive Director

Date

Name/Title FOR THE STATE:

Signature Elizabeth M. Browne, Director, Materials Management Division

Date

Name/Title

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https://www.michigan.gov/energy/0,4580,7-364--487842--,00.html

2

I. PROJECT SCOPE This Agreement and its appendices constitute the entire Agreement between the State and the Grantee and may be modified only by written agreement between the State and the Grantee. (A) The scope of this project is limited to the activities specified in Appendix A and such activities as are authorized by the State under this Agreement. Any change in project scope requires prior written approval in accordance with Section III, Changes, in this Agreement. (B) By acceptance of this Agreement, the Grantee commits to complete the project identified in Appendix A within the time period allowed for in this Agreement and in accordance with the terms and conditions of this Agreement. II. AGREEMENT PERIOD Upon signature by the State, the Agreement shall be effective from the Start Date until the End Date on page 1. The State shall have no responsibility to provide funding to the Grantee for project work performed except between the Start Date and the End Date specified on page 1. Expenditures made by the Grantee prior to the Start Date or after the End Date of this Agreement are not eligible for payment under this Agreement. III. CHANGES Any changes to this Agreement shall be requested by the Grantee or the State in writing and implemented only upon approval in writing by the State. The State reserves the right to deny requests for changes to the Agreement or to the appendices. No changes can be implemented without approval by the State. IV. GRANTEE DELIVERABLES AND REPORTING REQUIREMENTS The Grantee shall submit deliverables and follow reporting requirements specified by the state below and in Appendix A of this Agreement. (A) The Grantee must complete and submit semi-annual progress reports according to a form and format prescribed by the State. These reports shall be due according to the following: Reporting Period Due Date October 1 to March 31 April 15 April 1 to September 30 October 15

The Grantee shall submit to the State semiannual reports in a format approved by the State describing the progress implementing each Eligible Mitigation Action during the six-month period leading up to the reporting date (including a summary of all costs expended on the Eligible Mitigation Action through the reporting date). Such reports shall include a complete description of the status (including actual or projected termination date), development, implementation, and any modification of each approved Eligible Mitigation Action. These reports shall be signed by an official with the authority to submit the report for the Grantee and must contain an attestation that the information is true and correct, and that the submission is made under penalty of perjury. Any reports or deliverables provided to the State shall be submitted to the State’s contact. (B) The Grantee shall provide a final project report in a format prescribed by the State. Additionally, the Grantee shall submit the financial status report, including all supporting documentation for expenses, along with the final project report and any other outstanding products within 30 days from

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3

the End Date of the Agreement. (C) The Grantee must provide one copy of all products and deliverables in accordance with Appendix A. (D) All products shall acknowledge that the project was supported in whole or in part by the Charge Up Michigan Program, per the guidelines provided by the program. V. GRANTEE RESPONSIBILITIES (A) The Grantee agrees to abide by all applicable local, state, and federal laws, rules, ordinances, and regulations in the performance of this grant. (B) All local, state, and federal permits, if required, are the responsibility of the Grantee. Award of this grant is not a guarantee of permit approval by the State. (C) The Grantee shall be solely responsible to pay all applicable taxes and fees, if any, that arise from the Grantee’s receipt or execution of this grant. (D) The Grantee is responsible for the professional quality, technical accuracy, timely completion, and coordination of all designs, drawings, specifications, reports, and other services submitted to the State under this Agreement. The Grantee shall, without additional compensation, correct or revise any errors, omissions, or other deficiencies in drawings, designs, specifications, reports, or other services. (E) The State’s approval of drawings, designs, specifications, reports, and incidental work or materials furnished hereunder shall not in any way relieve the Grantee of responsibility for the technical adequacy of the work. The State’s review, approval, acceptance, or payment for any of the services shall not be construed as a waiver of any rights under this Agreement or of any cause of action arising out of the performance of this Agreement. (F) The Grantee acknowledges that it is a crime to knowingly and willingly file false information with the State for the purpose of obtaining this Agreement or any payment under the Agreement, and that any such filing may subject the Grantee, its agents, and/or employees to criminal and civil prosecution and/or termination of the grant. VII. ASSIGNABILITY The Grantee shall not assign this Agreement or assign or delegate any of its duties or obligations under this Agreement to any other party without the prior written consent of the State. The State does not assume responsibility regarding the contractual relationships between the Grantee and any subcontractor. VIII. SUBCONTRACTS The State reserves the right to deny the use of any consultant, contractor, associate, or other personnel to perform any portion of the project. The Grantee is solely responsible for all contractual activities performed under this Agreement. Further, the State will consider the Grantee to be the sole point of contact with regard to contractual matters, including payment of any and all charges resulting from the anticipated Grant. All subcontractors used by the Grantee in performing the project shall be subject to the provisions of this Agreement and shall be qualified to perform the duties required. The Grantee shall provide all sub-contractors or sub-grantees with a copy of this agreement.

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IX. NON-DISCRIMINATION The Grantee shall comply with the Elliott Larsen Civil Rights Act, 1976 PA 453, as amended, MCL 37.2101 et seq., the Persons with Disabilities Civil Rights Act, 1976 PA 220, as amended, MCL 37.1101 et seq., and all other federal, state, and local fair employment practices and equal opportunity laws and covenants that it shall not discriminate against any employee or applicant for employment, to be employed in the performance of this Agreement, with respect to his or her hire, tenure, terms, conditions, or privileges of employment, or any matter directly or indirectly related to employment, because of his or her race, religion, color, national origin, age, sex, height, weight, marital status, or physical or mental disability that is unrelated to the individual’s ability to perform the duties of a particular job or position. The Grantee agrees to include in every subcontract entered into for the performance of this Agreement this covenant not to discriminate in employment. A breach of this covenant is a material breach of this Agreement. X. UNFAIR LABOR PRACTICES The Grantee shall comply with the Employers Engaging in Unfair Labor Practices Act, 1980 PA 278, as amended, MCL 423.321 et seq. XI. LIABILITY (A) The Grantee, not the State, is responsible for all liabilities as a result of claims, judgments, or costs arising out of activities to be carried out by the Grantee under this Agreement, if the liability is caused by the Grantee, or any employee or agent of the Grantee acting within the scope of their employment or agency. (B) Nothing in this Agreement should be construed as a waiver of any governmental immunity by the Grantee, the State, its agencies, or their employees as provided by statute or court decisions. XII. CONFLICT OF INTEREST No government employee, or member of the legislative, judicial, or executive branches, or member of the Grantee’s Board of Directors, its employees, partner agencies, or their families shall benefit financially from any part of this Agreement. XIII. ANTI-LOBBYING Funds under this award cannot be used for lobbying, or intervention in state or federal regulatory or adjudicatory proceedings and cannot be used to sue the state or federal government or any other government entity. Likewise, a recipient may not use state or federal funds as matching funds for federal Supplemental Environmental Project Funds, or Supplemental Environmental Projects required under a consent order. XIV. DEBARMENT AND SUSPENSION By signing this Agreement, the Grantee certifies that it has checked the federal debarment/suspension list at www.SAM.gov to verify that its agents, and its subcontractors:

(1) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from covered transactions by any federal department or the state.

(2) Have not within a three-year period preceding this Agreement been convicted of or had a

civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (federal, state, or local) transaction or contract under a public transaction, as defined in 45 CFR 1185; violation of federal or state antitrust statutes or commission of embezzlement, theft, forgery,

Page 46 of 109

https://www.sam.gov/SAM/pages/public/searchRecords/search.jsf

5

bribery, falsification or destruction of records, making false statements, or receiving stolen property.

(3) Are not presently indicted or otherwise criminally or civilly charged by a government entity

(federal, state, or local) with commission of any of the offenses enumerated in subsection (2).

(4) Have not within a three-year period preceding this Agreement had one or more public transactions (federal, state, or local) terminated for cause or default.

(5) Will comply with all applicable requirements of all other state or federal laws, executive

orders, regulations, and policies governing this program. XV. AUDIT AND ACCESS TO RECORDS The State reserves the right to conduct a programmatic and financial audit of the project, and the State may withhold payment until the audit is satisfactorily completed. The Grantee will be required to maintain all pertinent records and evidence pertaining to this Agreement, including grant and any required matching funds, in accordance with generally accepted accounting principles and other procedures specified by the State. The State or any of its duly authorized representatives must have access, upon reasonable notice, to such books, records, documents, and other evidence for the purpose of inspection, audit, and copying. The Grantee will provide proper facilities for such access and inspection. All records must be maintained for a minimum of five years after the final payment has been authorized by the State. XVI. INSURANCE (A) The Grantee must maintain insurance or self-insurance that will protect it from claims that may arise from the Grantee’s actions under this Agreement. (B) The Grantee must comply with applicable workers’ compensation laws while engaging in activities authorized under this Agreement. XVII. OTHER SOURCES OF FUNDING The Grantee guarantees that any claims for reimbursement made to the State under this Agreement must not be financed by any source other than the VSMT under the terms of this Agreement. If funding is received through any other source, the Grantee agrees to delete from Grantee's billings, notify the State and immediately refund to Wilmington Trust, N.A., the total amount representing such duplication of funding. XVIII. COMPENSATION (A) A breakdown of costs allowed under this Agreement is identified in Appendix A. The State will pay the Grantee a total amount not to exceed the amount on page 1 of this Agreement, in accordance with Appendix A, and only for expenses incurred and paid. All other costs necessary to complete the project are the sole responsibility of the Grantee. (B) Expenses incurred by the Grantee prior to the Start Date or after the End Date of this Agreement are not allowed under the Agreement, (C) The State will approve payment requests after approval of reports and related documentation as required under this Agreement. (D) The State reserves the right to request additional information necessary to substantiate payment requests.

Page 47 of 109

6

(E) Payments under this Agreement will be processed by Electronic Funds Transfer (EFT) through Wilmington Trust, N.A. under the directive of the State. (F) The Grantee is committed to the match percentage of funds on page 1 of the Agreement, in accordance with Appendix A. XIX. CLOSEOUT (A) A determination of project completion, which may include a site inspection and an audit, shall be made by the State after the Grantee has met mandatory match obligations, satisfactorily completed the activities, provided actual value of any in-kind or leverage match, and provided products and deliverables described in Appendix A. (B) Upon issuance of final payment from the Wilmington Trust, N.A., the Grantee releases the State of all claims against the State arising under this Agreement. Unless otherwise provided in this Agreement or by State law, final payment under this Agreement shall not constitute a waiver of the State’s claims against the Grantee. (C) The Grantee shall immediately notify the State of any payments in excess of the costs allowed by this Agreement. The State reserves the right to require the Grantee to repay those costs to Michigan’s account with Wilmington Trust, N.A. XX. CANCELLATION This Agreement may be canceled by the State, upon 30 days written notice, due to Executive Order, budgetary reduction, other lack of funding, upon request by the Grantee, or upon mutual agreement by the State and Grantee. The State may honor requests for just and equitable compensation to the Grantee for all satisfactory and eligible work completed under this Agreement up until 30 days after written notice, upon which time all outstanding reports and documents are due to the State and the State will no longer be liable to pay the grantee for any further charges to the grant. XXI. TERMINATION (A) This Agreement may be terminated by the State as follows.

(1) Upon 30 days written notice to the Grantee:

a. If the Grantee fails to comply with the terms and conditions of the Agreement, or with the

requirements of the VSMT, or other applicable law or rules. b. If the Grantee knowingly and willingly presents false information to the State for the

purpose of obtaining this Agreement or any payment under this Agreement. c. If the State finds that the Grantee, or any of the Grantee’s agents or representatives,

offered or gave gratuities, favors, or gifts of monetary value to any official, employee, or agent of the State in an attempt to secure a subcontract or favorable treatment in awarding, amending, or making any determinations related to the performance of this Agreement.

d. If the Grantee or any subcontractor, manufacturer, or supplier of the Grantee appears in the register of persons engaging in unfair labor practices that is compiled by the Michigan Department of Licensing and Regulatory Affairs or its successor.

e. During the 30-day written notice period, the State shall withhold payment for any findings under subparagraphs a through d, above and the Grantee will immediately cease charging to the grant and stop earning match for the project (if applicable).

(2) Immediately and without further liability to the State if the Grantee, or any agent of the

Grantee, or any agent of any subcontract is:

Page 48 of 109

7

a. Convicted of a criminal offense incident to the application for or performance of a State,

public, or private contract or subcontract; b. Convicted of a criminal offense, including but not limited to any of the following:

embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property, or attempting to influence a public employee to breach the ethical conduct standards for State of Michigan employees;

c. Convicted under State or federal antitrust statutes; or d. Convicted of any other criminal offense that, in the sole discretion of the State, reflects

on the Grantee’s business integrity. e. Added to the federal or state Suspension and Debarment list.

(B) If a grant is terminated, the State reserves the right to require the Grantee to repay all or a portion of funds received under this Agreement to Michigan’s account with Wilmington Trust, N.A.

XXII. IRAN SANCTIONS ACT By signing this Agreement, the Grantee is certifying that it is not an Iran linked business, and that its contractors are not Iran linked businesses, as defined in MCL 129.312.

XXIII. DISCLOSURE OF INFORMATION All reports and other printed or electronic material prepared by or for the Grantee under the Agreement will not be distributed without the prior written consent of the State except for items disclosed in response to a Freedom of Information Act request, Court Order, or subpoena. The parties hereto understand and agree that it is the intent of the State to make all materials submitted as part of this project available to the public. XXIV. CONFLICT OF INTEREST Grantees will notify the State’s contact as identified on page 1 within 5 days of becoming aware of a conflict of interest. A conflict of interest is an actual or potential situation that undermines or may undermine, the impartiality of an individual or entity because their self-interest conflicts, or may conflict, with their duty and obligations in performing a grant. The term also includes situations that create, or may create, an unfair competitive advantage, or the appearance of such, for an applicant in competing for a grant. XXV. DRUG FREE WORKPLACE Grantee agrees to comply with all applicable federal, state, and local laws regarding smoke-free and drug-free work places and shall make a good faith effort to ensure that none of its employees or permitted subcontractors engaged in the work being performed hereunder purchase, transfer, use, or possess alcohol, illegal drugs, or abuse prescription drugs in any way during the performance of this Agreement. XXVI. VICTIM PROTECTION The Grantee certifies that the grantee, the grantee’s employees, subrecipients under this award, and subrecipients’ employees will not: a) engage in any form of trafficking in persons during the period of time that this award is in effect; b) procure a commercial sex act during the period of time that this award is in effect; or c) use forced labor in the performance of the award or sub awards under the award.

Page 49 of 109

PROJECT-SPECIFIC REQUIREMENTS – APPENDIX A MICHIGAN DEPARTMENT OF ENVIRONMENT, GREAT LAKES, AND ENERGY

CHARGE UP MICHIGAN


I. Project Summary EGLE and partners (electric utilities and applicant) will provide funding for three qualified Direct Current Fast Charger and two Dual Port Level 2 electric vehicle (EV) charging equipment, site preparation, equipment installation, networking fees and signage. EGLE will contribute equipment and material only. Site locations must follow guidance shown in "Electric Vehicle Charger Placement Optimization in Michigan: Phase I - Highways and Full Tourism." II. Contact Information Contact information of the party responsible for overseeing the EV site location and individual who will be reporting directly to the State about the project.

Name/Title: Jacob Hardy Organization: Traverse City Light and Power Street Address: 1131 Hastings St., City, State, Zip code: Traverse City, Michigan 49686 Phone: 231-932-4563 Email: [email protected]

III. Project Information Location(s) and Equipment. Site Address EV Equipment Total Estimated Cost per Site 111 E Grandview Pkwy, Traverse City, MI 49684 (Multi-locations in different downtown parking lots, see the attached map)

3× 75 kW – Tritium RTM75 and 2× L2 Chargers

$358,687.74

IV. Other Documentation

Attachments may include:

1. Supporting Documentation Any supporting documentation related to the project (quotes, project calculations, utility review documentation, other financial assistance etc.).

I. Effective Date

The effective start date of this agreement for reimbursement purposes, at the request of the Grantee as approved by the State, is the date of award approval, April 9, 2021, as allowable under section III. Changes in the Grant Agreement.

Page 50 of 109

mailto:[email protected]

February 10, 2021

Traverse City Light and Power will be the sole owner/operator of this EV charging station project. TCL&P

is the utility and thus there is no private partnership or funding.

TCL&P is looking to install 12 dual port level 2 charging stations as well as 3 DC fast charging stations

throughout Traverse City.

See attached map for exact locations

Page 51 of 109

Chargers 2 Level II TaxParcel: 51-794-022-00

2 Chargers Level II TaxParcel: 51-103-001-10

2 Chargers Level II 1 DCFC TaxParcel: 51-658-045-01

2 Chargers Level II TaxParcel: 51-794-100-01

2 Chargers Level II DCFC 2

TaxParcel: 51-658-003-00

Additional 2 Chargers Level II Chargers to go in at TADL TaxParcel: 51-111-069-20

Page 52 of 109

Grant Agreement – Appendix A

Marina Drive 2 – Level 2 Chargers (4 parking spots) 2 – DC Fast Charger (2 parking spots)

Lot C 2 – Level 2 Chargers (4 parking spots)

Page 53 of 109


Lot E 2 – Level 2 Chargers (4 parking spots)

Lot X 2 – Level 2 Chargers (4 parking spots) 1 – DC Fast Charger (1 parking spots)

Page 54 of 109


Lot N 2 – Level 2 Chargers (4 parking spots)

Traverse Area District Library ( Non - Metered) 2 – Level 2 Chargers (4 parking spots)

Page 55 of 109

Level II DCFC

QTY 2 - Level II QTY 1 - DC Fast Charger $5,329.18 Unit Cost $29,808.00

Equipment $20,774.56 $40,665.10 $1,754.10 O&M 5 years $8,639.10

Infrastructure Material $1,530.00 Networking Fee 5 Years $918.00

Infrastructure Labor $1,299.00 Cable Management $0.00

Installation $8,770.00 $2,207.00 $175.00 Shipping $650.00

SubTotal $40,522.84 $53,850.38 $300.00 Wrapping (Customization) $650.00

Location Total $10,387.28 TOTAL $40,665.10

QTY 2 - Level II QTY 1 - DC Fast Charger

Equipment $20,774.56 $40,665.10

Infrastructure Material $204,948.96

Infrastructure Labor $153,738.78

Installation $7,010.00 $2,027.00 $358,687.74SubTotal $35,321.07 $50,228.61

Location Total $20,774.56

$121,995.30

Infrastructure Material Only for DCFC Locations $30,993.17

QTY 2 - Level II QTY 1 - DC Fast Charger $173,763.03

Equipment $20,774.56 $40,665.10

Infrastructure Material

Infrastructure Labor

Installation $7,692.00 $2,195.00

SubTotal $35,266.26 $49,659.80

Location Total


Equipment $20,774.56 $0.00

Infrastructure Material $1,987.13 $0.00

Infrastructure Labor $1,400.44 $0.00

Installation $7,526.00 $0.00

SubTotal $31,688.12 $0.00

Location Total


Equipment $20,774.56 $0.00

Infrastructure Material $483.00 $0.00

Infrastructure Labor $513.19 $0.00


SubTotal $29,113.75 $0.00

Location Total


Equipment $20,774.56 $0.00

Infrastructure Material $1,517.25 $0.00

Infrastructure Labor $3,835.13 $0.00


SubTotal $33,036.94 $0.00

Location Total

Total Request for EGLE Grant

$29,113.75

$4,774.35

$33,036.94

Civic Center

Clinch Park

$9,801.75

Lot X - Hall St

$5,059.69

Lot C - Chamber

$94,373.21

$85,549.67

$12,154.80

Lot E - Post Office

Lot N - Washington Place

$84,926.05

$31,688.12

$10,013.33

$8,825.04

TOTAL LEVEL II CHARGER COST

TOTAL DC FAST CHARGER COST

TOTAL PROJECT COST

2 Level 2 Dual Port Chargers Equipment

3 DC Fast Charger Equipment

Page 56 of 109

Attachment 1

Grantee Name:Project Name:

Eligible Mitigation Action:Type:

Government/Non-Government Owned:Project Number (assigned by EGLE): `

HOURS or RATE orUNITS TOTAL

-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Contractual Services Subtotal: -$ -$ -$

-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Supplies & Materials Subtotal: -$ -$ -$

Three locations in Downtown Traverse City, MI 49684 - 3×75 kW Tritium RTM 3 51,246.26$ 152,988.47$ 750.31$ 153,738.78$ Multiple locations in Downtown Traverse City - 12×Level 2 Chargers 12 17,079.08$ 20,774.56$ 184,174.40$ 204,948.96$

-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Vehicle(s) & Equipment Subtotal 173,763.03$ 184,924.71$ 358,687.74$

Total All Costs 173,763.03$ 184,924.71$ 358,687.74$

IN-KIND / LEVERAGED FUNDS (Match that is not included in any category above): In Kind Cash Total-$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Total Other Match: -$ -$ -$

TOTAL PROJECT

DOLLAR VALUE PROJECTED:

TOTAL

VEHICLE(S) & EQUIPMENT QUANTITY COST% of

FUNDINGGRANT

AMOUNTMATCH

AMOUNT TOTAL

SUPPLIES & MATERIALS (itemize) QUANTITY COST% of

FUNDINGGRANT

AMOUNTMATCH

AMOUNT

CONTRACTUAL SERVICES% of

FUNDINGGRANT

AMOUNTMATCH

AMOUNT TOTAL

Charge Up Michigan - Utility EV Charger Program9 - Light Duty Zero Emission Vehicle Supply EquipmentLight Duty Zero Emission Vehicle Supply Equipment

21-5V91-024

Traverse City Light & Power

MICHIGAN DEPARTMENT OF ENVIRONMENT, GREAT LAKES, AND ENERGYMATERIALS MANAGEMENT DIVISION

CHARGE UP MICHIGANVOLKSWAGEN STATE MITIGATION TRUST

BUDGET FORM

Revised 2.5.21Page 57 of 109

To:

TCLP Board


Integrated Resource Plan

Staff issued a request for proposal (“RFP”) for Integrated Resource Plan (“IRP”) Services on September 21, 2021

with solicitation to five different firms and advertised in accordance with the Purchasing Policy in the Traverse City Record Eagle. Staff received only one proposal, that being from 1898 & Co, a division of Burns and McDonnell (“1898 & Co”)

for a fixed fee amount of $74,200 (does not include travel costs). This fixed fee amount is only for a base load forecast utilizing historical information. Any forecast that includes assumptions on new programs or changes to existing programs would be an additional scenario cost (electrification, energy waste reduction program, demand response) along with any sensitivity scenarios (change in load forecast or capital cost). These could cost an additional $6,000-$8,000 for each scenario or sensitivity, which brings the amount to $100,000-$125,000 which staff found out was the typical cost of an IRP. Additionally, beyond the mentioned scenarios or sensitivities, the request for proposal does not include the consultant providing recommendations on current energy policies, enhancements to the Energy Waste Reduction Program, creation of an electrification plan, guidance on a pilot energy storage project or review of time of use rates. These would be considered separate engagements similar to when staff issued a RFP for a Long Term Plan for the EWRP in 2014. After only receiving the singular bid, Staff reached out to two of the consultants that are well known throughout the industry for providing IRP services that were solicited and did not respond. One of the consultants mentioned they did not have the manpower to perform the services to the level of their standards. The other consultant, based on the RFP requirements and the limited budgeted amount provided (through an email request with the answer provided to all bidders), was instructed not to respond. Burns and McDonnell provided an option through their proposal to be within the budgeted amount disclosed while also providing options that allows the Board/Staff to choose what they wish to perform with the ability to consult with them to ensure the Board/Staff are performing scenarios/sensitivities that are beneficial in getting to the adopted scenario point. The adopted scenario will be the roadmap or plan for the Board/Staff to follow to achieve the Board’s goal of 100% renewable energy. It is anticipated Staff would bring back a change order to

the Board after the first initial stakeholder meeting providing the specific additional scenarios and sensitivities the consultant will perform as additional options. Burns and McDonnell has an extensive list of providing services to various electric utilities throughout the United States. In Michigan, they have served DTE Energy, ITC Holdings along with other municipal electric utilities including Holland Board of Public Works, Grand Haven Board of Light and Power and Marquette Board of Light and Power for the same power supply planning services. Staff followed up with two references provided in the proposal and both provided no concerns with their prior working relationship and deliverables from 1898 & Co.

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Based on the information provided in the proposal including the experiences of performing IRP Services, knowledgeable on new renewable generation technologies, providing holistic approach for the IRP services including generation, transmission and distribution, the access to various production cost modeling tools, successful regulatory filing and testimony support experience, and the proposed phase approach, staff recommends the Board authorize staff to enter into a consultant agreement with 1898 & Co part of Burns and McDonnell. If the Board agrees with the staff’s recommendation, the following motion is appropriate: MOVED BY _______________________, SECONDED BY ________________________, THAT THE BOARD AUTHORIZES THE INTERIM EXECUTIVE DIRECTOR TO ENTER INTO A CONSULTANT AGREEMENT WITH 1898 & CO PART OF BURNS AND MCDONNELL IN AN AMOUNT OF $74,200; SUBJECT TO APPROVAL AS TO SUBSTANCE BY THE INTERIM EXECUTIVE DIRECTOR AND AS TO FORM BY GENERAL COUNSEL.

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To:

TCLP Board


Kalkaska Combustion Turbine Operating Agreement

Over the past few months staff has been working with Michigan Public Power Agency (“MPPA”) on reviewing,

analyzing, and updating the Kalkaska Combustion Turbine Operations and Maintenance Agreement (“CT

Agreement”). The changes made to the agreement were more of clarification in nature of actual operations, responsibilities of each party and updating the reimbursement costs which includes increasing the reimbursement from 2.0 FTE’s

to 2.5 FTE’s. A track change version of the agreement is included for your review. The term of this revised CT Agreement is from January 1, 2022 through December 31, 2026. The CT Agreement has been scheduled to be approved by MPPA at their next board meeting November 9, 2021. General Counsel has reviewed the agreement. Staff recommends the Board authorize Kalkaska Combustion Turbine Operations and Maintenance Agreement with MPPA as it allows for full recoupment of costs along with providing clarity to required responsibilities by each entity. If the Board agrees with the staff’s recommendation, the following motion is appropriate: MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD AUTHORIZES THE CHAIRMAN AND SECRETARY TO ENTER INTO THE KALKASKA COMBUSTION TURBINE OPERATIONS AND MAINTENANCE AGREEMENT WITH MPPA; SUBJECT TO APPROVAL AS TO SUBSTANCE BY THE INTERIM EXECUTIVE DIRECTOR AND AS TO FORM BY GENERAL COUNSEL.

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OPERATION & MAINTENANCE SERVICES AGREEMENT

Between

Michigan Public Power Agency

And

Light and Power Department of the City of Traverse City

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OPERATION & MAINTENANCE SERVICES AGREEMENT Page 2 of 30

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Table of Contents

RECITALS ......................................................................................................................................4 ARTICLE 1. DEFINITIONS .......................................................................................................5 ARTICLE 2. SERVICES .............................................................................................................7 ARTICLE 3. TERM .....................................................................................................................9 ARTICLE 4. FEES AND PAYMENT.......................................................................................10 ARTICLE 5. INSURANCE .......................................................................................................11 ARTICLE 6. COMMUNICATION AND NOTICES ...............................................................12 ARTICLE 7. INDEMNIFICATION ..........................................................................................12 ARTICLE 8. LIMITATION OF LIABILITY ...........................................................................14 ARTICLE 9. MISCELLANEOUS PROVISIONS ....................................................................14 APPENDIX A. RESPONSIBILITY OF THE OPERATOR .....................................................19

1.1. OPERATOR RESPONSIBILITIES ................................................................................19 APPENDIX B. RESPONSIBILITY OF THE PARTIES – MAINTENANCE .........................21

2.1. OPERATOR RESPONSIBILITIES ................................................................................21 2.2. OWNER RESPONSIBILITIES ......................................................................................22

APPENDIX C. RESPONSIBILITY OF THE PARTIES – FUEL ............................................23 3.1. OPERATOR RESPONSIBILITIES ................................................................................23 3.2. OWNER RESPONSIBILITIES ......................................................................................23

APPENDIX D. RESPONSIBILITY OF THE PARTIES – ENVIRONMENTAL ...................24 4.1. OPERATOR RESPONSIBILITIES ................................................................................24 4.2. OWNER RESPONSIBILITIES ......................................................................................24

APPENDIX E. RESPONSIBILITY OF THE PARTIES – REIMBURSABLE COSTS ..........26 5.1. OPERATOR RESPONSIBILITIES ................................................................................26 5.2. OWNER RESPONSIBILITIES ......................................................................................26

APPENDIX F. COMMUNICATION AND NOTICES ............................................................28 ATTACHMENT A. PROJECT DESCRIPTION........................................................................29

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OPERATION AND MAINTENANCE SERVICES AGREEMENT BETWEEN

MICHIGAN PUBLIC POWER AGENCY AND LIGHT AND POWER DEPARTMENT OF THE CITY OF TRAVERSE CITY

This Agreement is made by and between Michigan Public Power Agency, a public body

politic and corporate of the State of Michigan organized pursuant to Public Act No.448 of 1976, as amended (“OWNER”), and Light and Power Department of the City of Traverse City (“OPERATOR”), a Michigan municipal electric utility and Member of MPPA on June 1, 2017January 1, 2022 (“Effective Date”). OWNER and OPERATOR are sometimes referred to herein as a (“Party”) and collectively as the (“Parties”).

RECITALS WHEREAS, OWNER owns a natural gas fired Combustion Turbine Electric Generation

Facility, including land and associated substation and structures, together known as the Combustion Turbine Unit No. 1 Project (“Project”), and

WHEREAS, OWNER has entered into Power Sales and Project Support Contracts with the Member Municipal Utilities of Charlevoix, Harbor Springs, Lowell, Petoskey and Light and Power Department of the City of Traverse City collectively known as the Combustion Turbine No. 1 Project participants (“Participants”) pursuant to which the Participants are entitled, in the aggregate, to 100% of the electric capacity and energy of the Project, and

WHEREAS, in order to reliably meet the energy and capacity commitments under those

contracts OWNER must properly monitor, maintain and operate the Project, and WHEREAS, OWNER conducted a competitive solicitation for the purpose of hiring an

operator to perform Operation & Maintenance Services (“Services”) to ensure the Project operates reliably, and

WHEREAS, the Services consist of the Labor, Operations, Maintenance and Materials

necessary to operate the Project in accordance with the tariff requirements of the wholesale electricity market, practices of the electric utility industry and the gas turbine manufacturer’s operating specifications, and

WHEREAS, the OPERATOR responded to the solicitation with a Services proposal that

through negotiation with OWNER is the subject of the terms and conditions contained this Agreement, and

WHEREAS, OWNER and OPERATOR have created this Agreement to describe the

accountability, responsibility and compensation for Services provided to the Project,

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NOW THEREFORE, in consideration of the mutual promises contained herein and other

good and sufficient consideration, the receipt and adequacy of which is hereby acknowledged, the OWNER and OPERATOR hereto agree as follows:

ARTICLE 1. DEFINITIONS

1.1. “Annual Budget” is the 12 Month Estimate of revenue and costs prepared by the OWNER for the upcoming calendar year.

1.2. “Annual Project Maintenance Plan” is the document that details the maintenance, outage, and overhaul schedules, staffing, known capital and expense budget items, and operating plans, and will provide the underlying assumptions used in developing the proposed budgets and anticipated availability of the Project for the period.

1.3. “Bankruptcy” means a situation in which (i) a party’s actions under applicable debtor relief laws demonstrate an inability to pay its debts as they mature or a need for protection from its creditors; (ii) a court of competent jurisdiction approves a petition filed against a party, which petition sought relief for the party’s creditors, and the action of the court remains in effect for an aggregated period of 60 days (whether or not consecutive); (iii) a party admits in writing its inability to pay its debts as they mature; (iv) a party gives notice to any person or entity of its current (or pending) insolvency or suspension of operations; or (v) a party makes an assignment for the benefit of creditors or takes other similar action for the protection or benefit of its creditors.

1.4. “Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized or required to close in United States.

1.5. “Contract Year” means: (i) for the first Contract Year, that period from the date of this Agreement in Article 3 to and including December 31 of such year; and (ii) for each Contract Year thereafter, the calendar year.

1.6. “EIA” means the United States Energy Information Administration. 1.7. “Environmental Regulatory Risk Policy” means the document containing the policies and

procedures for compliance with federal and state regulations pertaining to the Project. Examples include the Spill Prevention, Control, and Countermeasure (SPCC) plan and the Greenhouse Gas (GHG) emissions plan to meet the EPA Clean Air Act & its Amendments.

1.8. “EPA” means the United States Environmental Protection Agency. 1.9. “FERC” means the Federal Energy Regulatory Commission. 1.10. “FTE” means Full-Time Equivalent (full-time worker) and means an individual that

works 40 hours per week, Monday through Friday. 1.11. “Force Majeure Event” means an event, condition or circumstance beyond the reasonable

control of, and not due to the fault or negligence of, the party affected, and which could not have been avoided by due diligence and use of reasonable efforts, which prevents the performance by such affected party of its obligations hereunder; provided, that a “Force Majeure Event” shall not be deemed to have occurred or to be continuing unless the party

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claiming Force Majeure complies with the requirements of Article 9.3 (Force Majeure). Subject to the foregoing, “Force Majeure Event” shall include, as to either party, explosion and fire (in either case to the extent not attributable to the negligence of the affected party), flood, earthquake, storm or other natural calamity or act of God, strike or other labor dispute, war, insurrection or riot, actions or failures to act by governmental entities or officials, failure to obtain governmental permits or approvals (despite timely application therefor and due diligence) and changes in laws, rules, regulations, orders or ordinances affecting operation of the Project, which events were not pending on the date of this Agreement.

1.12. “Fuel Scheduler” is in general the entity that nominates fuel quantities with the natural gas pipeline and storage on the Project’s behalf.

1.13. “Generator Interconnection Agreement” is the Generator Interconnection and Operating Agreement between MPPA and Wolverine Power Supply Cooperative, Inc. entered into on 10/1/2002.

1.14. “Good Utility Practice” means (i) any of the practices, methods, and acts engaged in or approved by a significant portion of the electric utility industry in the country and geographic region where the Project is located during the relevant time period, or (ii) practices, methods and acts that, in the exercise of reasonable judgment on the facts known (or that reasonably should have been known) at the time a decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition.

1.15. “Kalkaska Project Procedures” is in general the document containing the policies and procedures covering Project operations, maintenance, emergency response, security, safety, and environmental compliance jointly maintained by OPERATOR and OWNER.

1.16. “Lender(s)” means (i) any entity that has made loans to OWNER, its successors or permitted assigns for the financing or refinancing of the Project (or any part thereof).

1.17. “Local Balancing Authority” means the responsible entity for integrating electric generation resources plans ahead of time, maintains load-interchange-generation balance with a defined Balancing Authority Area and supports interconnection frequency in real-time.

1.18. “Market Scheduler” is in general the entity that interfaces with the Midcontinent ISO (“MISO”) on the Project’s behalf to enter market offers and receive dispatch communications.

1.19. “MDEQ” means the State of Michigan Department of Environmental Quality. 1.20. “MDNRE” means the State of Michigan Department of Natural Resources. 1.21. “NERC” means the North American Electric Reliability Corporation. 1.22. “O&M Annual Services Fee Table” means the Table of annual operating Service Fee

estimates provided by OPERATOR to OWNER that represent total annual estimated Service Fee in their O&M Services proposal that represent not to exceed costs as set forth in Article 4.

1.23. “OEM” means Original Equipment Manufacturer or the entity that manufactured the natural gas turbines or Pratt & Whitney.

1.24. “OPERATOR” has the meaning set forth in the recitals.

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1.25. “Operating Manuals” means the operating data, design drawings, specifications, vendors' manuals, warranty requirements, procedures (including those for maintenance of the Project and environmental and safety compliance), and similar materials with respect to the Project.

1.26. “OWNER” has the meaning set forth in the recitals. 1.27. “Parameter Monitoring Plan / Startup Shutdown Malfunction Plan (PMP/SSMP)” means

the document that provides the operational and maintenance guidance for the Project during startup, shutdown, and malfunction events.

1.28. “Parametric Emissions Monitoring System (PEMS)” means the software program used for emissions monitoring.

1.29. “Project” means the Combustion Turbine Project No. 1 Facility Description in Attachment A, incorporated hereby reference, along with related assets, together with the piping, hardware, software, and the buildings at the site from the gas receipt point through the transmission system interconnection point, operating on real property in Kalkaska, Michigan.

1.30. “Project Agreements” means the agreements relating to the Project, Power Sales and Project Support contracts, any resolution or supplemental resolutions related to the bonds that financed the Project and all other agreements applicable to the Project, permits, and licenses required for the operation, maintenance and management of the Project, as identified in writing by OWNER.

1.31. “Reimbursable Costs” has the meaning set forth in Article 4.2 and listed in Appendix E. 1.32. “Renewable Operating Permit” means the document constituting the OWNER’s

authority to operate the Project in accordance with the general conditions, special conditions and attachments issued by the MDEQ.

1.33. “Services” means the Operation, Maintenance, and Management Services described within this Agreement provider by OPERATOR to OWNER.

1.34. “Services Fee” means the costs described in Article 4 incurred by OPERATOR and charged to OWNER for providing the Services each calendar month of the Agreement.

1.35. “Transmission Provider” has the meaning set forth in the Generator Interconnection Agreement.

1.36. “Wholesale Electric System Operator” means the Midcontinent ISO or (“MISO”) or its successors authorized by the Federal Energy Regulatory Commission to control and operate the regional electric transmission system.

ARTICLE 2. SERVICES

2.1. Scope. OPERATOR shall operate, maintain and manage the Project on behalf of OWNER and perform the specific duties as set forth in Appendices A through F of this Agreement, attached hereto and incorporated hereby reference, (“Services”) required by the standards defined in Article 2.2.

2.2. Standards for Performance. OPERATOR shall perform the Services required under this

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Agreement in a prudent, reasonable, and efficient manner and in accordance with the (i) Project Agreements, (ii) all applicable laws, (iii) Good Utility Practice, (iv) the requirements of any Wholesale Electric System Operator, and (v) all insurance policies specified in Article 5 of this Agreement. OPERATOR shall use all reasonable efforts to optimize the useful life of the Project and to minimize Reimbursable Costs and Project outages, derates or other unavailability.

2.3. OPERATOR's Personnel Standards. OPERATOR shall provide as reasonably necessary all labor and professional, supervisory and managerial personnel as are required to perform the Services as set forth in Appendices A through F of this Agreement. Such personnel shall be qualified to perform the duties to which they are assigned and shall meet any requirements for Project personnel under the Project Agreements. All individuals employed by OPERATOR to perform the Services shall be employees of OPERATOR, and their working hours, rates of compensation and all other matters relating to their employment shall be determined solely by OPERATOR (subject to OWNER's approval rights with respect to the Annual Budget). With respect to labor matters, hiring personnel, and employment policies, OPERATOR shall comply with all applicable laws. OPERATOR also shall act in a reasonable manner that is consistent with the intent and purpose of this Agreement and with OPERATOR’s acknowledgment (hereby given) that OPERATOR has no authority to enter into any contracts with respect to labor matters that purport to bind or otherwise obligate OWNER.

2.4. Compliance. OPERATOR shall comply with all laws applicable to the operation, maintenance and management of the Project and the performance of the Services. OPERATOR shall apply for and obtain, and OWNER shall assist OPERATOR in applying for and obtaining, all necessary permits, licenses and approvals (and renewals of the same) required to allow OPERATOR to do business or perform the Services under this Agreement. OPERATOR shall provide reasonably necessary assistance to OWNER, to secure permits, licenses, and approvals (and renewals of the same) that OWNER is required to obtain from or file with any governmental agency regarding the Project. OPERATOR also shall file such reports, notices, and other communications as may be required by any governmental agency regarding the Project.

2.5. Operating Records and Reports. OPERATOR shall maintain, at a location acceptable to OWNER, the Project operating logs, records, and reports that document the operation and maintenance of the Project, all in form and substance sufficient to meet OWNER's reporting and retention requirements under the Project Agreements. OPERATOR shall provide OWNER reasonably necessary assistance in connection with OWNER's compliance with reporting requirements under the Project Agreements, applicable laws or any other agreement to which OWNER is a party relating to the Project. Such assistance shall include providing reports, records, logs and other information that OWNER may reasonably request as to the Project or its operation.

2.6. No Liens or Encumbrances. OPERATOR shall maintain the Project free and clear of all liens and encumbrances resulting from any action of OPERATOR, except for such liens or encumbrances that result directly from nonpayment by OWNER of amounts due and owing to OPERATOR under this Agreement.

2.7. No Action. OPERATOR shall not take any action that would cause a default under any Project Agreement, except where such action is expressly permitted by this Agreement.

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2.8. Emergency Action. OPERATOR shall promptly notify OWNER and take all necessary action to attempt to prevent or mitigate any such threatened damage, injury or loss if an emergency endangering the safety or protection of persons, the Project, or property located near the Project. OPERATOR shall make reasonable efforts to minimize any cost associated with remedial action in case of such an emergency.

2.9. Action in Extraordinary Circumstances. In the event that: (a) the Project or major Project equipment suffers an unplanned outage (or OPERATOR reasonably believes that such an occurrence is imminent), and (b) OPERATOR has made reasonable, but unsuccessful efforts to notify and communicate with OWNER regarding such occurrence or imminent occurrence in accordance with the terms of this Agreement, then (c) OPERATOR shall:

(i) Take all necessary action to prevent or to mitigate such unplanned outage, (ii) Make reasonable efforts to minimize any cost associated with such remedial action, (iii) Continue to attempt to notify and communicate with OWNER regarding the occurrence and the remedial action

2.10. OWNER Obligations. The OWNER shall have such obligations as are stated herein and in Appendices B through E attached hereto and incorporated herein by reference.

ARTICLE 3. TERM

3.1. This Agreement shall commence on June January 1, 201722 and remain in effect until December 31, 2021 2026 unless terminated by either OWNER or OPERATOR after giving twelve [12] months prior written notice.. 3.1.1. No later than April 1, 2026 both the OWNER and OPERATOR shall meet to start

discussions about the potential renewal of this OPERATION & MAINTENANCE SERVICES AGREEMENT.

3.1.1.3.1.2. OWNER and OPERATOR may waive the Term or Termination provisions of this Agreement if they mutually determine that a new arrangement or strategy with respect to the Project operation, ownership or Services to the Project are in the best interest of OWNER and the Participants.

3.1.2.3.1.3. Upon termination, OPERATOR will cooperate with OWNER in transferring or removing any equipment or documentation necessary for the continued reliable operation of the Project.

3.2. The All previousSeptember 13, 2010, Operating and Maintenance Agreements between the parties is are superseded by this Agreement except to the extent of any reimbursement obligations of OWNER.

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ARTICLE 4. FEES AND PAYMENT ARTICLE 4.

4.1. Services Fee. As compensation to OPERATOR for performance of the Services hereunder, OWNER shall pay OPERATOR a Services Fee. OPERATOR will invoice OWNER for providing the Services each calendar month by calculating its cost of labor based on two and one half (2.50) FTEs provided in the proposal (unless a different amount number of FTEs is agreed upon by both the OWNER and OPERATOR, which is most likely to occur if more than two and one half FTEs are needed to properly operate and maintain the Project), [SD1]actual overtime incurred for the Pproject and the , benefits and administrative overhead, monthly cell phone charges and FR clothing cost for the two and one half FTEs. OPERATOR will provide along with supporting information sufficient to validate the charges.

4.1.1. The following O&M Annual Services Fee Table is provided by OPERATOR to OWNER represent OPERATOR’S best estimate of the total Service Fee costs for as part of OPERATOR’s O&M Services proposal and represent OPERATOR’s best estimate of the not to exceed costs for providing the Services during each Contract Year from 2017 January 1, 2022 through December 31, 20216. As set forth in 4.1, this Service Fee is subject to adjustment in the event that more than two and one half FTE’s are needed to properly operate and maintain the Project.

O&M Annual Services Fee Table:

Contract Year Amount

20172022 $250,000428,000 202318 $465,000445,500 201249 $440,000467,500 202520 $412,500492,800 202621 $425,000[SD2]511,600

4.2. Reimbursable Costs. In addition to the Services Fee paid to OPERATOR, OWNER shall

reimburse OPERATOR for approved out of pocket costs incurred by OPERATOR in performing the Services. Examples of such costs are set forth in Appendix E (collectively, the “Reimbursable Costs”). The Reimbursable Costs in Appendix E are presented as a best example of the types of charges or costs that could be incurred by OPERATOR in performing the Services but if a cost or charge is not stated in Appendix E and is incurred legitimately by OPERATOR subject to this Article 4 then OWNER shall reimburse OPERATOR for such cost or charge. OWNER’s obligation under this provision is subject to (i) OWNER's express approval of the costs as part of an Annual Budget, (ii) separately approving the costs in writing, or (iii) OPERATOR incurring costs in accordance with Article 2.8 or 2.9. Expenditures made by OPERATOR in excess of the Annual Budget that are required to comply with any Law applicable to the Services to the Project, shall be approved and reimbursed by OWNER. OWNER shall pay Reimbursable Costs along with the monthly payment of the Services Fee in accordance with the Billing & Payment

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provisions of Article 4.4. 4.3. Billing Period. Unless otherwise specifically agreed upon by the Parties, the calendar

month shall be the standard period for all invoices and payments under this Agreement. 4.4. Billing and Payment. Within twenty (20) days following the end of each calendar month,

OPERATOR shall submit to OWNER an Invoice for (a.) the Services Fee incurred during the previous month and (b.) the Reimbursable Costs incurred for such month.

4.4.1. Within thirty (30) days after receipt of any such invoice, OWNER shall pay OPERATOR the sum specified in such invoice, less (i) any amounts previously deposited with OPERATOR relating to such invoice, and (ii) any portion of such invoice amount that OWNER disputes in good faith or is permitted to offset under this Agreement.

4.5. Disputes and Adjustments to Invoices. A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice, rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due, with notice of the objection given to the other Party.

ARTICLE 5. INSURANCE

5.1. Coverage. 5.1.1. OWNER Coverage. OWNER shall maintain, or cause to be maintained, in

force, insurance with responsible insurers with policies payable to the OWNER and OPERATOR, as their interests shall appear, against risk of direct physical loss, damage or destruction, at least to the extent that similar insurance is mandated by law or usually carried by utilities constructing and operating similar Projects and other properties or rights associated therewith, including liability insurance and property insurance, all to the extent available at a reasonable cost and subject to reasonable deductible provisions, but in no case less than will satisfy all applicable regulatory requirements, including any applicable permit or license requirements, and conform to Good Utility Practice. Notwithstanding the foregoing, OWNER may, to the extent permitted by the Project Agreements, and, subject to the approval of the MPPA Board of Commissioners, self-insure or participate in a program of self-insurance or group insurance to the extent it receives a written opinion of a qualified insurance consultant that such self-insurance, after consideration of any existing or required reserve deposits, is reasonable in light of existing programs or comparable utilities constructing and operating similar pProjects. Owner will, upon request, furnish Operator with a certificate of insurance identifying the various coverages and insured limits in force at the time of the request. Owner agrees to use its best efforts to have Operator included as an additional insured on its policy documents.

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5.1.2. OPERATOR Coverage. OPERATOR shall maintain, or cause to be maintained, in force, insurance with responsible insurers with policies payable to the OWNER and OPERATOR, as their interests shall appear, vehicle insurance and workers compensation insurance, against risk of direct physical loss, damage or destruction, at least to the extent that similar insurance is mandated by law or usually carried by utilities constructing and operating similar pProjects and other properties or rights associated therewith, all to the extent available at a reasonable cost and subject to reasonable deductible provisions, but in no case less than will satisfy all applicable regulatory requirements, including any applicable permit or license requirements, and conform to Good Utility Practice. Operator will, upon request, furnish Owner with a certificate of insurance identifying the various coverages and insured limits in force at the time of the request. Operator agrees to use its best efforts to have Owner included as an additional insured on its policy documents.

5.1.3. Cost. All costs incurred by OPERATOR with respect to payment of any deductible relating to the insurance coverage set forth in this Article 5 shall be deemed Reimbursable Costs.

5.2. Certificates. On or before the date on which insurance must be provided, each party shall furnish certificates of insurance to the other party evidencing the insurance required pursuant to this Agreement. Each party shall cooperate with the other to ensure collection from insurers for any loss under any such policy.

5.3. Payment of Deductible Amounts. Notwithstanding which party hereto shall have purchased, or been responsible for the purchase of, any insurance in respect of the Project or otherwise referred to in this Agreement, OPERATOR shall promptly pay to OWNER any deductible amount related to any claim against or other cost to OWNER covered under any such insurance policy which arose due to the gross negligence of OPERATOR.

ARTICLE 6. COMMUNICATION AND NOTICES

6.1. Notices. All notices and other communications (collectively “Notices”) required or permitted under this Agreement shall be in writing and shall be given to each party at its address or fax number set forth below in Appendix F where appropriate.

6.2. Designated Representatives. Upon execution of this Agreement OWNER and

OPERATOR will designate personnel that will act as the primary point of contact for day to day operational and maintenance issues of the Project as identified in Appendix F. If these Designated Representatives change during the course of the Agreement OWNER and OPERATOR must deliver such Notice in writing.

ARTICLE 7. INDEMNIFICATION

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7.1. Indemnification. (a) Indemnification by OPERATOR. OPERATOR shall, to the extent permitted by law,

indemnify, defend and hold harmless OWNER, the members thereof, and their respective officers, directors, employees, agents, Affiliates and representatives (the “OWNER Indemnified Parties”), from and against any and all claims (in whatever form and to the fullest extent permitted by law) arising out of or in any way connected with, but only to the extent of, any gross negligence, fraud or willful misconduct of OPERATOR or anyone acting on OPERATOR's behalf or under its instructions, in connection with this Agreement and OPERATOR's obligations thereunder up to and to the extent of its insurance coverage for such claims. Any costs or expenses incurred by OPERATOR pursuant to its indemnity obligations under this Article 7.1(a), including the cost of deductibles with respect to the insurance maintained by OPERATOR or OWNER pursuant to Article 5 or losses in excess of such insurance coverage, shall not constitute a Reimbursable Cost under this Agreement. (b) Indemnification by OWNER. OWNER shall, to the extent permitted by law, indemnify, defend and hold harmless OPERATOR, its officers, directors, employees, agents, Affiliates and representatives (the “OPERATOR Indemnified Parties”) from and against any and all claims (in whatever form and to the fullest extent permitted by law) arising out of or in any way connected with, but only to the extent of, any gross negligence, fraud or willful misconduct of OWNER or anyone acting on OWNER's behalf or under its instructions (other than OPERATOR and its suppliers, subcontractors, venders, and their subcontractors and vendors and any employee or agent of the foregoing), in connection with this Agreement and OWNER's obligations thereunder.

7.2. Environmental Liability.

(a) OPERATOR Liability. OPERATOR shall not be responsible or be required to carry environmental pollution insurance for claims directly or indirectly related to hazardous materials present at the Project before the date of this Agreement, except to the extent OPERATOR acted with respect to such materials in a grossly negligent manner. OWNER shall, to the extent permitted by law, defend, indemnify and hold OPERATOR harmless against such claims, except to the extent such claims arise from OPERATOR's grossly negligent or intentional acts. (b) OWNER Liability. OWNER shall not be responsible for claims directly related to hazardous materials at the Project arising out of the grossly negligent or intentional acts of OPERATOR. This provision of the Agreement shall not be construed to require OPERATOR to take corrective action with respect to any hazardous materials at the Project before the date of this Agreement. (c) Governmental Actions. If action is required at the Project to comply with any applicable environmental laws during the term of this Agreement, OWNER (with OPERATOR's assistance) shall be responsible for the costs of compliance. Costs for compliance action shall only be incurred by OPERATOR as a Reimbursable Cost with OWNER's prior written consent, unless a governmental authority requires OPERATOR to incur such costs and expenses prior to obtaining such written consent in which case such cost shall be a Rreimbursable cCost..

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ARTICLE 8. LIMITATION OF LIABILITY

8.1. Limitations of Liability. (a) Consequential Damages. Notwithstanding any provision in this Agreement to the contrary, OPERATOR and OWNER each agree not to assert against the other any claim, demand or suit for consequential, incidental, indirect or special damages arising from any aspect of the performance or nonperformance of the other party or any third-party engaged by such other party under this Agreement, and each party hereto waives any such claim, demand or suit against the other in connection with this Agreement. (b) Damages Limited to Annual O&M Services Fee. The aggregate liability of OPERATOR (except for those claims that are subject to the provisions of Article 7.1(a) (Indemnification by OPERATOR) or covered by the insurance set forth in Article 5, and then only to the extent such claims are actually covered thereby, after giving effect to any deductibles, exclusions, limits, or self-insured retentions thereunder) with respect to claims of OWNER arising out of the performance or nonperformance of obligations under this Agreement shall in no event exceed, during any Contract Year, the Annual O&M Services Fee payable to OPERATOR during such Contract Year plus the amount necessary to satisfy OPERATOR's indemnification responsibilities under Article 7. (c) Personal Liability Limited. OPERATOR and OWNER each understand and agree that there shall be absolutely no personal liability on the part of any of the members, partners, officers, employees, directors, agents, authorized representatives or Affiliates of OWNER or OPERATOR for the payment of any amounts due hereunder, or performance of any obligations hereunder. (d) Survival. The parties further agree that the waivers and disclaimers of liability, indemnities, releases from liability, and limitations on liability expressed in this Agreement shall survive termination or expiration of this Agreement, and shall apply at all times (unless otherwise expressly indicated), regardless of fault, negligence, strict liability, or breach of warranty of the party indemnified, released or whose liabilities are limited, and shall extend to the members, partners, principals, officers, employees, controlling persons, executives, directors, agents, authorized representatives, and affiliates of such party. (e) Exclusivity. The provisions of this Agreement constitute OPERATOR's and OWNER's exclusive liability, respectively, to each other, and OPERATOR's and OWNER's exclusive remedy, respectively, with respect to the Services to be performed hereunder and OWNER hereby releases OPERATOR performing Services hereunder, and OPERATOR hereby releases OWNER performing its obligations hereunder, from any further liability.

ARTICLE 9. MISCELLANEOUS PROVISIONS

9.1. Assignment. Neither OWNER nor OPERATOR may assign its rights or obligations under this Agreement without the prior written consent of the other party hereto, except that this Agreement may be assigned by OWNER without such prior consent to any successor of

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OWNER, to a person or entity acquiring all or a majority share of the Project. 9.2. Access to Project.

(a) OWNER and its representatives shall have access at all times to the Project and any documents, materials and records and accounts relating to Project operations for purposes of inspection and review. Upon the request of OWNER, OPERATOR shall make available to such persons or entities identified by OWNER as an Agent or Representative of OWNER any operating data, operating logs, documents, materials or records. (b) During any such inspection or review of the Project, OWNER and OPERATOR shall cooperate with each other to have third parties conduct such inspection and review in a manner which causes minimal interference with OPERATOR's activities. OPERATOR agrees to cooperate in providing requested information and documentation for the support of any financial or legal transactions associated with the Project.

9.3. Force Majeure. If either OWNER or OPERATOR is rendered wholly or partially unable to perform its obligations under this Agreement (other than payment obligations) due to a Force Majeure Event, the party affected by such Force Majeure Event shall be excused from whatever performance is impaired by such Force Majeure Event, provided that the affected party promptly, upon learning of such Force Majeure Event and ascertaining that it will affect its performance hereunder, (i) promptly gives notice to the other party stating the nature of the Force Majeure Event, its anticipated duration, and any action being taken to avoid or minimize its effect and (ii) uses its reasonable commercial efforts to remedy its inability to perform. The suspension of performance shall be of no greater scope and no longer duration than that which is necessary. No obligations of either party which arose before the occurrence causing the suspension of performance and which could and should have been fully performed before such occurrence shall be excused as a result of such occurrence. The burden of proof shall be on the party asserting excuse from performance due to a Force Majeure Event.

9.4. Amendments. No amendments or modifications of this Agreement shall be valid unless evidenced in writing and signed by duly authorized representatives of both parties.

9.5. No Waiver. It is understood and agreed that any delay, waiver or omission by OWNER or OPERATOR with respect to enforcement of required performance by the other under this Agreement shall not be construed to be a waiver by OWNER or OPERATOR of any subsequent breach or default of the same or other required performance on the part of OWNER or OPERATOR.

9.6. Fines and Penalties. If during the term of this Agreement any governmental or regulatory authority or agency assesses any fines or penalties against OPERATOR or OWNER arising from OPERATOR's failure to operate and maintain the Project in accordance with applicable laws without OWNER's prior written consent, such fines and penalties shall, subject to the limitations set forth in Article 8, be the sole responsibility of OPERATOR and shall not be deemed a Reimbursable Cost.

9.7. Representations and Warranties. Each party represents and warrants to the other party that: (a) such party has the full power and authority to execute, deliver and perform this Agreement and to carry out the transactions contemplated hereby; (b) to the best of such party's knowledge, the execution, delivery and performance by such

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party of this Agreement, does not and will not materially conflict with any legal, contractual, or organizational requirement of such party; and

(c) there are no pending or threatened legal, administrative, or other proceedings that if adversely determined, could reasonably be expected to have a material adverse effect on such party's ability to perform its obligations under this Agreement.

9.8. Counterparts. The Parties may execute this Agreement in counterparts, which shall, in the aggregate, when signed by both parties constitute one Agreement. Thereafter, each counterpart shall be deemed an original Agreement as against any party who has signed it.

9.9. Dispute Resolution. The Parties will attempt in good faith to resolve any dispute or claim arising out of or in relation to this Agreement through negotiations between senior executives appointed by each of the Parties with authority to settle the relevant dispute. If the dispute cannot be settled amicably within thirty (30) Days after delivery of a Dispute Notice, either Party may seek legal and equitable remedies. Performance of this Agreement shall continue during any dispute or legal proceeding related to such dispute. No payment due or payable by the OWNER or Service by the OPERATOR shall be withheld on account of a pending dispute.

9.10. Governing Law. This Agreement is executed and intended to be performed under the laws of the State of Michigan

9.11. Partial Invalidity. If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the rest of this Agreement shall remain in full force and effect and in no way be affected, impaired or invalidated.

9.12. Captions. Titles or captions of Articles contained in this Agreement are inserted as a matter of convenience and for reference, and do not affect the scope or meaning of this Agreement or the intent of any provision hereof.

9.12.9.13. Third Party Beneficiaries. This agreement confers no rights or remedies on any third party, other than the parties to this Agreements and their respective successors and permitted assigns.

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IN WITNESS WHEREOF, OPERATOR and OWNER have caused this Agreement to be

executed by their duly authorized officers, as of the day and year first above written above (“Effective Date”). TRAVERSE CITY LIGHT AND POWER MICHIGAN PUBLIC POWER AGENCY

BY:______________________________ NAME: __________________________

TITLE:___________________________

_

BY:______________________________ NAME: __________________________

TITLE:___________________________ Approved as to Substance:

BY:______________________________

NAME: __________________________

TITLE:______________________________________

Approved as to form:

BY:______________________________ NAME: __________________________

TITLE:___________________________

BY:______________________________ NAME: __________________________

TITLE:____________________________

___________

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APPENDIX A. RESPONSIBILITY OF THE OPERATOR

1.1. OPERATOR RESPONSIBILITIES OPERATOR shall:

1.1.1. Assume care, custody and control and responsibility for the security of the Project and the day-to day operation and maintenance of the Project twenty four (24) hours a day, seven (7) days a week in accordance with the Project agreements, governmental approvals and rules, all insurance policies, the applicable contractor, manufacturer and vendor warranties and station manuals, and provide technical and administrative support as required for Project operation and maintenance for the purpose of maintaining the operating readiness of the Project. This does not include information technology items such as, but not limited to: computers, firewalls, routers, cybersecurity, virtual private networks, internet connectivity, etc. These items will be covered and maintained by OWNER.

1.1.2. Respond to dispatch orders from MISO via the Market Scheduler, OWNER, Local Balancing Authority, or Transmission Provider having authority to start, operate, and stop the Project

1.1.3. Ensure that a competent management team and skilled workforce staff is adequately trained via a continuing program of training, which is to be conducted at least annually and approved by the OWNER. The training is designed to orient new Project personnel, refresh/cross-train existing Project personnel, qualify/re-qualify Project personnel, and keep all Project personnel aware of the safety requirements and emergency procedures based on current and future Project operational scenarios

1.1.4. Provide the Market Scheduler and OWNER with all required information regarding the Project’s availability for market offers, operations status, and outage planning a minimum of one (1) hour prior to the MISO market deadline each day

1.1.5. Perform a review of start requirements, system status, and surveillance of all equipment routinely used to communicate with the Project a minimum of one (1) hour prior to the MISO market deadline each day

1.1.6. Operate the Project in accordance with the OEM requirements and recommendations, utilize Good Utility Practice, and comply with all laws and environmental regulations and agreements for the Project as outlined in the Project Agreements

1.1.7. Monitor and adjust the output of the Project to maintain the electricity output to meet the Project’s market offer parameters

1.1.8. Manage the Project outages (planned, unscheduled, forced) to minimize outage duration and impact on production to maximize profitability of meeting efficiency, output, and availability targets 1.1.8.1. Communicate initial and updated outage information to the Market Scheduler as

soon as practical 1.1.9. Monitor and adjust the reactive output of the Project to maintain transmission voltage levels

within the capability of the Project and requirements of the Generator Interconnection Agreement or Wholesale Electric System Operator

1.1.10. Respond to and correct generator dynamic instability in accordance with instructions from MISO via the Market Scheduler, Local Balancing Authority, or Transmission Provider having jurisdiction

1.1.11. Maintain Project security and be responsible for the overall Project cleanliness and preservation

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1.1.12. Conduct normal Project operations and maintenance activities 1.1.13. Respond to alarms from the Project, and provide such other on-site and remote observation

and control services at the Project as appropriate to ensure its safe and reliable operation 1.1.14. Investigate unusual or unique incidents, such as breaker failure, engine motoring, turbine

vibrations & etc. 1.1.15. Perform all administrative activities related to the Services of the Project including

management of subcontractors, coordination of procurements with OWNER, maintain and update all manuals and Project specifications and plans, etc.

1.1.16. Review and provide input regarding operability, maintainability, and environmental and safety issues pertaining to the Project

1.1.17. Assist OWNER in complying with all local, state, and federal regulations, including reliability standards imposed by NERC and Reliability First

1.1.18. Daily Logbook – Project personnel will collect data during shift 1.1.18.1. The times of these readings along with any other issues or concerns will be

recorded in the Project logbook 1.1.18.2. Data from the logbook will be analyzed so that remedial actions can be taken

immediately to correct off-standard performance 1.1.19. Promptly notify OWNER when OPERATOR identifies circumstances that in the

OPERATOR’S best judgement could result in future operational constraints such as deteriorating or poorly operating equipment or issues on the property or adjacent property that could interfere with the successful operation of the Project to avoid potential economic opportunity loss

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APPENDIX B. RESPONSIBILITY OF THE PARTIES – MAINTENANCE


2.1.1. Maintain the Project in a clean and workable condition 2.1.2. Perform regular Project maintenance and inspections in accordance with the Annual Project

Maintenance Plan and the Kalkaska Project Procedures 2.1.2.1. This will include all activities at the Project from the natural gas receipt point through

the Transmission Provider interconnection point 2.1.3. Trouble-shoot and correct Project problems, in conjunction with OWNER, equipment

vendors, and consultants as may be appropriate 2.1.4. Ensure that the Project has the proper inventory of parts and consumables to perform the

maintenance and repair services 2.1.5. Provide timely and appropriate on-site maintenance & repair services in order to ensure the

Project is available to dispatch into the wholesale electricity market in a reliable manner 2.1.6. Review OEM service bulletins and, in coordination with OWNER and implement as

appropriate 2.1.7. Develop and execute an Annual Project Maintenance Plan detailing scheduled maintenance

activities and operating plans which will be submitted to OWNER by September 15th of each year for the following fiscal year

2.1.7.1. Provide high level recommendations for significant scheduled maintenance activities, equipment replacement & repairs to be performed in the next five years as part of the Annual Project Maintenance Plan

2.1.8. Assure that the Project meets contract, regulatory, and environmental maintenance and recordkeeping requirements set forth in the Project Agreements entered into by OWNER

2.1.9. Implement policies and procedures in accordance with the Project Agreements to support safe, efficient operation of the Project

2.1.10. Perform all activities in accordance with the Project Agreements, including those relating to safety, security and fire prevention to ensure that the Project is operated and maintained in a safe and environmentally appropriate manner in accordance with all local, state, and federal laws and regulations

2.1.11. Directly carry out or manage third party contractors to undertake preventive, routine, predictive maintenance and repairs, periodic scheduled inspections, testing, major maintenance (outside of any OEM agreements that may be in place), repairs and overhauls

2.1.12. Purchase and maintain materials adequate to support continuous and successful operation of the Project in accordance with established procurement procedures with specific emphasis on critical spares and consumables

2.1.13. Maintain current revisions of all as-built drawings, specifications, vendor information, lists, clarifications and other materials provided for the Project, and shall design and implement procedures and protocols for the regular updating of such documentation

2.1.14. Retain and preserve all records, reports, documents and data, including all data retrievable from an electronic data storage source, created in connection with the operation and maintenance of the Project

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2.1.15. Coordinate all maintenance work with the Market Scheduler, Local Balancing Authority or Transmission Provider

2.1.16. Establish and review periodic maintenance plans in coordination with OWNER 2.1.17. Perform non-shutdown preventative and basic maintenance visual inspections of key

operating systems, instrumentation and controls, general housekeeping and the replacement of oil filters, air filter, and igniters

2.1.18. Perform periodic preventative and basic maintenance inspections to ensure the integrity of the equipment that are unable to be performed while the equipment is in operation

2.1.19. Coordinate inspections and maintenance to ensure the highest availability and reliability is achieved

2.1.20. Monthly Reports - Within seven (7) calendar days after the end of each calendar month, submit to OWNER a mutually developed monthly progress report in reasonable detail covering activities conducted during such calendar month with respect to operation and maintenance (including, if applicable, information regarding power generation, fuel consumption, starts, trips, availability factor, capacity factor, and gross heat rate and net heat rate), capital improvements, labor relations and other significant matters

2.1.21. Annual Reports - Within forty-five (45) calendar days after the end of each fiscal year, submit to OWNER a summary report (in such form and substance and with such back-up as OWNER may reasonably request) covering the performance of the units during the fiscal year, and the operation and maintenance activities planned or conducted during the previous fiscal year.

2.2. OWNER RESPONSIBILITIES

OWNER shall: 2.2.1. Review and approve the Annual Project Maintenance Plan

2.2.1.1. Such approval will become the basis for the approved Annual Budget, assuring that operational goals and operating plans are consistent with the Annual Project Operating Plan

2.2.2. Make periodic Project inspections quarterly or more frequently as necessary 2.2.3. Coordinate with OPERATOR to schedule and implement, as required, calibration/testing of

all gauges, meters and recording devices related to the consumption of fuels and water and to the sale of electricity. Examples include Generator Verification Test Capacity, natural gas flow meter calibration, and emission stack testing

2.2.4. Provide maintenance and support for information technology items such as, but not limited to: computers, firewalls, routers, cybersecurity, virtual private networks, internet connectivity, etc.

2.2.3.

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APPENDIX C. RESPONSIBILITY OF THE PARTIES – FUEL


3.1.1. On a daily basis Pprovide Fuel Scheduler and OWNER with all required information regarding the Project’s fuel consumption including an hourly natural gas burn estimate for the entire location via the burn sheet template or other agreed upon methodwithin one hour of the dispatch start time

3.1.2. Submit an revised hourly natural gas burn estimate for the entire location on a daily basis via the Burn burn Sheet sheet Template template as described in the Kalkaska Project Procedures or other agreed upon method if the dispatch instructions are changed

3.1.3. Provide the Project’s updated actual fuel consumption within one hour of the dispatch offline time via the burn sheet template or other agreed upon methodif the Market Scheduler communicates an updated dispatch during the run


OWNER shall: 3.2.1. Maintain natural gas transportation and supply contracts necessary to reliably supply the

Project with natural gas 3.2.2. Maintain contracts with a Fuel Scheduler or house those skill sets and tools at OWNER as

necessary to procure, receive, schedule, and/or nominate natural gas on behalf of the Project 3.2.2.3.2.3. Procure or authorize procurement of fuel necessary for daily operations.

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APPENDIX D. RESPONSIBILITY OF THE PARTIES – ENVIRONMENTAL


4.1.1. Ensure the PEMS is continuously available and operational in accordance with EPA requirements and as specified in the Kalkaska Project Procedures

4.1.2. Provide needed Project records and documentation, including periodic maintenance plans, to OWNER on a continuous basis, to ensure that

4.1.3.1. OWNER is kept fully informed of activities, maintenance and events 4.1.3.2. OWNER is able to maintain an off-site duplicate of the environmental records in

accordance with EPA requirements 4.1.3.3. OWNER is able to ensure Project is in compliance with the Environmental

Regulatory Risk Policy 4.1.3. Annually review the Project Renewable Operating Permit to ensure necessary maintenance

items are scheduled and verify records exist, are readily accessible at the Project, are adequately stored, and are maintained throughout the minimum retention period

4.1.4. Annually review the Environmental Regulatory Risk Policy and ensure necessary environmental compliance activities and verify records exist, are readily accessible at the Project, are adequately stored, and are maintained throughout the minimum retention period

4.1.5. Function as secondary liaison with the EPA, MDEQ, MDNRE and other regulatory agencies in coordination with OWNER as needed

4.1.6. Ensure the Project is in compliance with the Parameter Monitoring Plan / Startup Shutdown Malfunction Plan (PMP/SSMP)

4.1.7. Monitor the underground holding tank level and the scheduling of a waste handling company to remove tank contents when they reach 80% capacity

4.1.8. Maintain personnel as the named contact for the generator waste profile form on file with the waste handling company for emptying the underground holding tank

4.1.9. Maintain personnel as the named hazardous waste contact on file with the MDEQ 4.1.10. Prepare and submit all routine reports for the Project as requested relative to performance,

including environmental performance records, waste handling, maintenance and repair status, Project operating data, and any other information reasonably requested or required to be maintained by EIA, EPA, FERC, MDEQ, MDNRE, MISO, NERC, and OWNER


OWNER shall: 4.2.1. Apply for and maintain operating and environmental permits as required 4.2.2. File emissions and operating reports as required 4.2.3. Maintain the Environmental Regulatory Risk Policy 4.2.4. Function as primary liaison with the EPA, MDEQ, MDNRE and other regulatory agencies

as needed

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4.2.5. Ensure the generator waste profile form on file with the waste handling company is correct for the underground holding tank

4.2.6. Provide primary compliance with all local, state, and federal environmental regulations, including Reliability Standards imposed by NERC

4.2.7. Annually review the Project Renewable Operating Permit, 40 CFR Part 75, and Environmental Regulatory Risk Policy records

4.2.8. Designated Representatives may visit the Project periodically to ensure the environmental monthly reporting data gathered is accurate and support the Project personnel with any environmental issues that arise as requested or needed by OPERATOR

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APPENDIX E. RESPONSIBILITY OF THE PARTIES – REIMBURSABLE COSTS


5.1.1. Provide support, including payroll registers, work order reports, effective hourly labor rates, and receipts or invoices, for any requested reimbursements

5.1.2. Provide the vehicles and insurances used for Project Services activities under this Agreement 5.1.3. Charge OWNER for the portion of the actual vehicle monthly fee as charged to OPERATOR

by the City Government for the dedicated vehicle to be used for Project business and actual fuel consumption along with any other vehicle used for Project business at the State of Michigan equipment hourly rate published in MDOT Schedule C of Equipment Rates or by other calculations as established by mutual agreement, not to exceed the values in 5.2.1.2

5.1.4. Recommend to OWNER any parts, materials, components or third party services costing in excess of $15,000 that OPERATOR believes are needed for maintenance or operation of the Project

5.1.5. Review, approve, and submit the Project Services related invoices to OWNER no later than the 20th 15th of each month following the calendar month end

5.1.6. Work with the OWNER in creating the Annual Budget with mutual agreement on the recommended budget to the CT Committee and/or MPPA Board for approval on an annual basis


OWNER shall: 5.2.1. Reimburse OPERATOR for the Services provided pursuant to this Agreement as follows:

5.2.1.1. Reimburse OPERATOR monthly for material and other actual costs, including emergency expenses, associated with monitoring, maintaining and operating the Project including any ancillary services not covered under this Agreement such as work outside of the generator, including but not limited to substation maintenance, IT assistance, engineering assistance or any other work not typically included with daily operations and maintenance

5.2.1.2. Reimburse OPERATOR monthly for invoiced vehicle costs for transportation to and from the OPERATOR service center based on actual charges not to exceed the maximum amount that would be charged in the table below through December 31, 20212026

Annual Vehicle Costs Table:

Contract Year Amount 20172022 $13,50014,900 20182023 $23,30016,400 20192024 $23,75018,000 20202025 $24,25019,800 20212026 $24,750[MB3]21,800

5.2.1.3. Reimburse OPERATOR for monthly invoiced out-of-pocket costs associated with

the monitoring and dispatching of the Project, including communication line charges, equipment

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maintenance, procurement of components and coordination of necessary work with other parties performed by OPERATOR

(A) Reimbursable Cost items shall be paid to OPERATOR in accordance with the requirements of Articles 5 and 7. Reimbursable Costs may include but are not limited to:

1. Spare and replacement parts 2. All material, tools and equipment necessary to operate and maintain the Project 3. Chemicals 4. Lubricants (including proper disposal costs) 5. Specialized instrumentation, test, and calibration equipment 6. Rigging and handling equipment 7. Consumables and general supplies 8. Cleaning Supplies 9. Shop equipment installed in Project 10. Authorized leased equipment 11. Major equipment overhauls 12. Building repairs and maintenance (not caused by contractors under the Project Agreements) 13. Insurance costs in accordance with Article 5.1.3) 14. Costs related to training of plant personnel 15. Consultants' fees and expenses, if incorporated in the Annual Budget or otherwise approved in advance by OWNER. 16. Contract Services, if incorporated in the Annual Budget or otherwise approved in advance by OWNER

(B) The following will be Reimbursable Costs when specifically related to Project support:

1. Office supplies 2. Office equipment and furniture 3. Telephone and other communication service charges 4. Freight and express mail charges 5. Janitorial, cleaning, and grounds keeping services

5.2.1.4. Review OPERATOR’s recommendations, under normal circumstances, to OWNER on any parts, materials, components or third partythird-party services costing in excess of $15,000 that OPERATOR believes are needed for maintenance or operation of the Project and provide a written response concurring with or disallowing OPERATOR’s request 5.2.1.4.1. Reserve the right to disallow reimbursement for any materials or services purchased

by OPERATOR without obtaining OWNER’s prior written consent under normal circumstances in excess of $15,000 if contrary to OWNER’s direction

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APPENDIX F. COMMUNICATION[MB4] AND NOTICES Notices shall be sent to the following addresses:

To OWNER: Michigan Public Power Agency 809 Centennial Way Lansing, MI 48917-9277 ATTN: Amy L. DeLeeuw, Chief Financial Officer Tel: (517) 323-8919 x107 Fax: (517) 323-8373 E-Mail: [email protected] To OPERATOR:

Traverse City Light & Power 1131 Hastings Street Traverse City, MI 49686 ATTN: Pete SchimpkeTony Chartrand, System EngineerManager of Operations and Engineering Tel: (231) 932-45504562 Fax: (231) 922-4638 E-Mail: [email protected] [email protected]

Designated Representatives are: OWNER:

Michigan Public Power Agency 809 Centennial Way Lansing, MI 48917-9277 ATTN: Keith Parrott, Senior Engineer – Generation ServicesMatt Burk, Power Generation Services Lead Tel: (517) 323-8919 x116x135 Fax: (517) 323-8373 E-Mail: [email protected] [email protected] OPERATOR:

Traverse City Light & Power 1131 Hastings Street Traverse City, MI 49686 ATTN: Tony Chartrand, System EngineerPete Schimpke, Manager of Operations and Engineering Tel: (231) 932-45504562 Fax: (231) 922-4638 E-Mail: [email protected]@tclp.org

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ATTACHMENT A. PROJECT DESCRIPTION

1.0 The Project, consists of

1.1. A simple-cycle combustion turbine electric generating facility fueled with natural gas located at 1750 Prough Rd SW, Kalkaska, MI 49646

1.1.1. The Project generating unit has a nominal rating of 55 megawatts and is comprised of two Pratt & Whitney FT8-1 aero derivative natural-gas fired combustion turbines, which drive a single electrical generator

1.2. Natural gas pipeline and metering equipment to connect the generator to the natural gas Project, 1.2.1. The Project is served from the ANR Pipeline Company Prough Road interconnect and gas

meter 1.2.2. Natural gas is injected into the ANR Storage Company Deward location for use in the Project

throughout the year 1.2.3. Natural gas is withdrawn from the ANR Storage Company Deward location for use in the

Project when dispatched 1.2.4. Natural gas can be delivered and received at several points along the Great Lakes Gas

Transmission and ANR Pipeline Company from the ANR Joliet Hub (outside of Chicago) to the ANR Storage Company interconnect with Great Lakes at Deward through long-term Transportation Agreements of OWNER

1.3. A 69 kV interconnection and associated electrical protection and relaying equipment to the transmission system owned by Wolverine Power Cooperative Inc. necessary to settle the output of the Project to the MISO wholesale electricity market at the Commercial Pricing Node (“CpNode”) known as CONS.KALK, and

1.4. The Project also has a diesel engine for operating a fire pump, a natural gas-fired “line-heater” to preheat natural gas fuel before that fuel is supplied to the turbines, and a boiler-heater system for the engine enclosures

2.0 The Project is located in Kalkaska County, Michigan, approximately 1.6 miles southwest of the town

of Kalkaska 2.1. A parcel of land located in the northwest one-quarter (NW 1/4) of the southeast one-quarter (SE

1/4) of fractional Section 31, T.27N., R.07W., E. Kalkaska Township, Kalkaska County, Michigan, more fully described as follows:

2.1.1. PART OF THE NW 1/4 OF SE 1/4 FRL SEC 31 T27N-R7W DESC AS COM AT THE S 1/4 COR OF SD FRL SEC 31 TH S 89 DEG 54'33”E 1328.91 FT ALG THE S LI OF SD FRL SEC TO THE E 1/8 LI OF SD FRL SEC TH N 00 DEG 51' 15”E 1322.34 FT ALG THE E 1/8 LI OF SD FRL SEC TO THE S 1/8 LI OF SD FRL SEC TO A FOUND CONCRETE MONUMANT AND THE POB TH N 89 DEG 57'54”W 1207.39 FT ALG THE S 1/8 LI OF SD FRL SEC TH N 44 DEG 10' 35”E 95.52 FT TH 154.08 FT ALG THE ARC OF A 201.15 FT RADIUS CURVE TO THE LEFT THE CENTRAL ANGLE OF WHICH IS 43 DEG 53'14” AND THE CHORD OF WHICH BEARS N 22 DEG 13'58”E 150.34 FT TH N 00 DEG 17' 21”E 112.50 FT TH N 89 DEG 52'14”E 376.01 FT TH N 00 DEG 00'35”W 100.97 FT TH N 89 DEG 53'40”E 714.11 FT TO THE E 1/8 LI OF SD FRL SEC TH S 00 DEG 54'27”W 424.10 FT ALG THE E 1/8 LI OF SD FRL SEC TO THE POB CONT 9.87 ACRES SUBJ TO EASEMENTS AND RESTRICTIONS OF RECORD

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2.1.2. Tax Parcel Number 40-008-031-010-20 2.2. The Project was completed and placed in commercial operation in December 2002 2.3. OPERATOR has monitoring and remote start capability for the Project via a remote terminal

located at the OPERATOR system control center located in Traverse City, MI

3.0 OWNER has developed an offer strategy for the Project whereby the unit is operated as a peaking resource on behalf of the Participants 3.1. As a “peaking plant”, the Project operates mostly for short periods of “peak load” when demand

for electricity is high or is operated out of economic merit order when the Transmission Provider requires voltage or frequency support

3.2. Under this mode of operation, the Project is expected to operate 3.2.1. When power is at or near peak load conditions, 3.2.2. When an unexpected loss of a resource creates a need for capacity and energy for the

Participants and the Project can supply the needed energy at a lower cost than is available from purchases from third parties, or

3.2.3. When the wholesale electric market conditions are such that the output of the Project may be sold to third parties at a price which will provide a reasonable net revenue benefit to the Participants

3.3. Under this operating mode, the Project is expected to operate less than 1,000 hours per year, which will reduce costs to the Participants by stretching the time between major overhauls

3.4. OWNER operates the Project to provide energy & capacity and the associated economic benefit to the Participants who have long-term Power Sales and Project Support Contracts with the Project

3.4.1. The Project must operate in the Day-Ahead and Real-Time market as it is a Capacity Resource in the MISO

3.4.2. To operate the Project effectively, natural gas must be forecasted, purchased and scheduled to accommodate electric day operation

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To:

TCLP Board

From: Kelli Schroeder - Manager of Human Resources and Communications, Karla Myers- Beman - Interim Executive Director/Controller


Staff Appreciation - Three Additional Paid Days Off

As indicated during our last Board meeting, Commissioner Shamroe spoke regarding providing additional paid days off between Christmas and New Year’s Day, city wide, as appreciation for staff’s efforts throughout the

pandemic. The City Commission supported the additional paid time off at their October 25, 2021 meeting. Now this item is being brought to the TCL&P Board for approval and included with this memo is a Letter of Understanding (LOU) with the Utility Workers Union of America. The LOU details out the parameters surrounding the additional paid days off. These parameters would also apply to TCL&P’s non-union administrative employees. If after Board discussion you agree with providing additional paid days off between Christmas and New Year’s

Day and the parameters outlined in the LOU, the following motion would be appropriate: MOVED BY ______________, SECONDED BY ______________, THAT THE BOARD APPROVES THE ADDITIONAL THREE DAYS (24 HOURS) OFF BETWEEN CHRISTMAS AND NEW YEAR'S DAY FOR BOTH TCL&P ADMINISTRATIVE, CONFIDENTIAL, TECHNICAL EMPLOYEES AND AUTHORIZES THE BOARD CHAIRMAN TO SIGN THE LETTER OF UNDERSTANDING BETWEEN TCL&P AND THE UTILITY WORKERS UNION OF AMERICA LOCAL NO. 295.

Page 91 of 109

Letter of Understanding‘ between

‘Traverse City Light & Powerand

Utility Workers Union of America, AFL—CIOLocal No. 295

Staff Appreciation — three days (24 hours) Additional Paid Time OffWeek Between Christmas and New Year’s Day

WHEREAS, the undersigned are parties to a Collective Bargaining Agreement (CBA)expiring on June 30, 2024; and

WHEREAS, the City of Traverse City Commission, Light and Power Board andDowntown Development Authority would like to acknowledge the tough challenges the City,

TCL&P and DDA employees overcame in providing services during the pandemic; and

WHEREAS, in collaborationwith the City and DDA, the TCL&P Board would like to

provide an additional three days (24 hours) of paid time off between Christmas and New Year’s

Day;

NOW, THEREFORE, IT IS HEREBY AGREED UPON between the parties as

follows:

1. The staff appreciation paid time off will notexceed three days (24 hours).

2. The designatedstaff appreciationdays will be Tuesday, December 28, 2021 through

Thursday, December 30, 2021.3. The additionalpaid time off will be paid at straight time rate.

4. Employees scheduledon standby will work normal working hours (generally 07:30-16:00) during these three staff appreciationdays at regular pay. The three paid time off

days (24 hrs) will be provided to these employees for use at a later date but not to exceedJune 30, 2022. Days off must be used in increments of one full day (3 hrs) and willrequire advance request and approval by supervisor for the time off. Consecutive use of

all three paid days off is encouraged.5. The Electric System Operator designated on standby for these three days will work a

straight time shift from 07:00am—l5:00.6. Employees on standby will continue to receive 1 hour of standby pay for each of the three

days.7. Non-standby employees who are asked to work or are called in during the normal

working hours for these three days will be paid normal straight time pay. Employeesasked to work or who get called in during the normal working hours will be providedtime off to be used no later than June 30, 2022 in an amount of time equal to the timeworked during the normal scheduledwork day. Advance notice and approval by

supervisoris required. Employees who work an amount of time that results in 8 hours or

more of paid time off must use in increments of one full day (8 hrs), or as close to it, andwill require advance request and approval by supervisor for the time off. Consecutive use

of all three paid days off is encouraged.

Page 1of 2 Page 92 of 109

8. The three appreciation days will be calculated towards the MERS De?ned Bene?t,De?ned Contribution,MERS HCSP and the 457 Deferred Compensation calculations.

9. There will be no cash payouts for any unused appreciation days.10. The additional time off being offered between Christmas 2021 and New Year’s Day 2022

is one time only in nature.11. All other provisions of the CBA will remain unchanged and this Letter of Agreement will

be without precedent or prejudice to any future matters.

IT IS FURTHER AGREED THAT this Letter of Understandingwill become effectiveon the date it is fully executed by all of the parties below and it shall be unique to this case.Neither the Employer nor the Union waive any rights as to other future cases.

WHEREBY, the parties signifyagreement to the above by representative signaturesappearing hereon. ‘~

IN WITNESS WHEREOF, the parties hereto have, by their representatives dulyauthorized in the premises, executed this Letter of Understanding.

City of Traverse City Utility Workers of AmericaLight and Power Board AFL-CIO and its LOCAL NO. 295

BY BYPaul Heiberger, Board Chairperson James Gennett, National Rep.

Region IV

DATE DATE

BYRolfertHip‘),PresiLocal 295

DATE (Z. Ag, gé)g[

APPROVED AS TO SUBSTANCE:

BYKarla Myers-Beman, Interim Executive Director

DATE

Page 2 of 2 Page 93 of 109

To:

TCLP Board

From: Scott Menhart - Chief Information Technology Officer, Karla Myers-Beman - Interim Executive Director/Controller


FTTP Update

Included in the packet is an update on number of customers subscribed, projected annual revenue, comparison of budget to actual income statement and drop costs.

Page 94 of 109


Fiber to the Premise Project

November 9, 2021

Launch Date: October 1, 2020

November 9, 2021

Active

Customers

Provision

and

Scheduled

Customers

Deferred

Customers Total

CBA

Take Rate

Total

Customer

Percentage of

CBA Take

Rate Goal

Active and

Prospective

Projected

Annual

Revenue

CBA

Projected Annual

Revenue

Percentage

of CBA

Annual

Revenue Goal

Residential

200 MB 63 6 4 73 - 52,551.24$ -$

500 MB 92 9 3 104 - 87,347.52$ -$

1 GIG 43 6 3 52 402 56,153.76$ 435,799.00$

Subtotal Residential 198 21 10 229 402 56.97% 196,052.52$ 435,799.00$ 44.99%

Commercial

500 MB 41 2 1 44 - 52,794.72$ -$

1 GIG 20 2 1 23 378 41,397.24$ 662,256.00$

Subtotal Commercial 61 4 2 67 378 17.72% 94,191.96$ 662,256.00$ 14.22%

VOIP

Residential (number of lines) 19 - - 19 3,417.72$

Commercial (number of lines) 36 1 - 37 11,095.56$

Subtotal VOIP 55 1 - 56 219 25.57% 14,513.28$ 83,785.00$ 17.32%

Bundle Discounts

Residential 19 - - 19 (1,137.72)$

Commercial 32 - - 32 (1,916.16)$

Subtotal Bundle Discounts 51 - - 51 - (3,053.88)$ -$

Total 314 26 12 352 999 35.24% 301,703.88$ 1,181,840.00$ 25.53%

Notes

Active Customers - Customers who are receiving service.

Provision and Scheduled Customers - Customers equipment is provisioned and customers are scheduled to be installed.

Deferred Customers - Customers who have signed up for service, but have requested a delay in installation.

CBA stands for Cost Benefit Analysis

CUSTOMER TAKE RATE - Phase 1 REVENUE

Page 95 of 109



November 9, 2021

Launch Date: April 5, 2021

November 9, 2021

Active

Customers

Provision

and

Scheduled

Customers

Deferred

Customers Total Take Rate

Total

Customer

Percentage of

Projected Take

Rate Goal

Active and

Prospective

Projected

Annual

Revenue

Projected Annual

Revenue

Percentage

of

Annual

Revenue Goal

Residential

200 MB 83 6 - 89 - 64,069.32$ -$

500 MB 103 6 - 109 - 91,546.92$ -$

1 GIG 57 1 - 58 389 62,633.04$ 279,889.34$

Subtotal Residential 243 13 - 256 389 65.81% 218,249.28$ 279,889.34$ 77.98%

Commercial

500 MB 6 - - 6 - 7,199.28$ -$

1 GIG 2 - 1 3 20 5,399.64$ 23,517.65$

Subtotal Commercial 8 - 1 9 20 45.00% 12,598.92$ 23,517.65$ 53.57%

VOIP

Residential (number of lines) 19 3 - 22 - 3,957.36$

Commercial (number of lines) - - - - - -$

Subtotal VOIP 19 3 - 22 143 15.38% 3,957.36$ 25,740.00$ 15.37%

Bundle Discounts

Residential 19 - - 19 - (1,137.72)$

Commercial - - - - - -$


Total 270 16 1 287 552 51.99% 233,667.84$ 329,146.99$ 70.99%

Notes




CUSTOMER TAKE RATE - Phase 1.1 REVENUE

Page 96 of 109



November 9, 2021

November 9, 2021

Active

Customers

Provision

and

Scheduled

Customers

Deferred

Customers Total Take Rate

Total Customer

Percentage of

CBA/Projected

Take Rate Goal

Active and

Prospective

Projected

Annual

Revenue

Projected

Annual

Revenue

Percentage

of

Annual

Revenue Goal

Residential

200 MB 146 12 4 162 - 116,620.56$ -$

500 MB 195 15 3 213 - 178,894.44$ -$

1 GIG 100 7 3 110 791 118,786.80$ 715,688.34$

Subtotal Residential 441 34 10 485 791 61.31% 414,301.80$ 715,688.34$ 57.89%

Commercial

500 MB 47 2 1 50 - 59,994.00$ -$

1 GIG 22 2 2 26 398 46,796.88$ 685,773.65$

Subtotal Commercial 69 4 3 76 398 19.10% 106,790.88$ 685,773.65$ 15.57%

VOIP

Residential (number of lines) 38 3 - 41 7,375.08$

Commercial (number of lines) 36 1 - 37 11,095.56$

Subtotal VOIP 74 4 - 78 362 21.55% 18,470.64$ 109,525.00$ 16.86%

Bundle Discounts

Residential 38 - - 38 (2,275.44)$

Commercial 32 - - 32 (1,916.16)$


Total 584 42 13 639 1,551 41.20% 535,371.72$ 1,510,986.99$ 35.43%

Notes




CUSTOMER TAKE RATE - ALL PHASES REVENUE

Page 97 of 109



Fiscal Year End June 30, 2022 Budgeted Revenues and Expenses

November 9, 2021

FY 20/21

Recommended Fiscal Year to date Difference

OPERATING REVENUES

Lit Fiber System

Residential 519,300.00$ 147,294.65$ (372,005.35)$

Commercial 270,400.00$ 39,608.92$ (230,791.08)$

VoIP 19,000.00$ 6,867.70$ (12,132.30)$

Merchandising and Jobbing -$ 1,618.76$ 1,618.76$

Forfeited Discounts -$ 1,077.40$ 1,077.40$

Miscellaneous Revenues -$ 50,000.00$ 50,000.00$

Total Operating Revenues 808,700.00$ 246,467.43$ (562,232.57)$

OPERATING EXPENSE

Salaries and wages 77,300.00$ -$ 77,300.00$

Fringe benefits 49,200.00$ -$ 49,200.00$

Operating expenses -$ -$ -$

Communications -$ 545.35$ (545.35)$

Professional services - Lit Fiber 522,000.00$ 189,508.43$ 332,491.57$

Printing and publishing -$ -$ -$

City Fee 40,400.00$ 12,323.37$ 28,076.63$

Miscellaneous expense -$ 4,556.97$ (4,556.97)$

Total Operating Expenses 688,900.00$ 206,934.12$ 481,965.88$

Change in net position 119,800.00$ 39,533.31$ (80,266.69)$

Notes:

2. Revenues are invoiced through October 1, 2021 and expected or invoiced expenses through October 31, 2021.

1. Excerpt from the Fiber Fund Budget where activity was added to reflect the Lit Fiber operations. Revenues and costs

reflected only represent additional revenue and expense to the Fiber Fund.

Page 98 of 109



Summary of Drop Costs

November 9, 2021

Drop Cost

Contract Amount - Drop Costs - Materials and Devices 561,455.00$

Drop Costs -Installation Technician - (O&M invoices) 166,696.05$

Drop Costs - Materials and Devices 194,533.75$

Total Capital Expended - Drop Costs 361,229.80$

Balance left on Contract Amount - Drop Costs - Materials and Devices 366,921.25$

Note: Installation Technician are part of the Operation and Maintenance Contract and material

and devices are part of the drop costs reflect Phase 1 and Phase 1.1.

Page 99 of 109

To:

TCLP Board


2022 Six Year Capital Improvement Plan

Included in your packet is a first draft of the Six Year Capital Improvements Plan – 2022 (Plan) for Board discussion. The draft reflects what staff believes are the priorities of the utility in the coming years. Staff continued with the process developed in the prior year of identifying reliability projects and the manner of prioritization. In revisiting project identification and prioritization, staff followed the below process:

• Gather Data - System reliability and capacity, timing of City or other Utility projects • Analyze – Identify equipment experiencing highest amount of customer minutes out, potential for customer

minutes out, and potential capacity issues • Identify Root Causes – What are the causes of outages? • Identify Projects - Short and long-term fixes and potential customer outage minutes saved, rough project costs • Prioritize Projects - Consider cost per customer minute saved, impacts to critical and large customers, timing

with projects of others Included with this Plan is a preliminary cash flow analysis that will be updated as the audit is finalized, and staff progresses through the budget process. However, staff knows the importance of this document to be used as a tool for the Board to make decisions on approving the Plan. Even though this document is preliminary, staff feels it provides enough evidence to the Board there will be adequate funds to cover the proposed Electric Utility capital projects. There was a rate increase effective July 1, 2021 and a rate increase is planned for July 1, 2022. A consecutive rate increase is attributed to delaying a rate increase that was planned to occur July 1, 2020 during the COVID pandemic. Staff will incorporate all ideas and suggestions (supported by the majority) into the final Plan by the following board meeting for the Board’s consideration of approval. This will allow TCL&P’s capital projects to be incorporated into the

City’s overall capital plan for Planning and City Commission review and approval. Additionally, it will allow for a more focused review of the proposed budget by separating the review of these two vital guiding documents. Additionally, it is staff’s understanding the Planning Commission will only be reviewing those projects that significantly

improve or change the appearance and function of the current infrastructure or significant capital assets or new infrastructure of significant capital assets (ex. Parkway lighting). The remaining projects that do not fit this classification will be classified as “projects”. Staff is letting you know in case these documents are presented at meetings and not all of TCLP projects are included. Staff thought it would be best to continue to present all of the projects in one document for simplicity purposes. Staff will discuss the NEW proposed projects (purple color). There were two projects removed from the plan. The first was Security Cameras as it was deemed by staff that further analysis would have to be completed to determine if this is a viable project. The other was the Grandview Parkway project in the years 2025-26 and 2026-27 as it was determined not economical based on the investment.

Page 100 of 109

Additionally, staff wanted to let the Board know the Parkway Lighting Project will be primarily funded through allocated funds from the Downtown Development Authority. These funds have been recognized as Other Operating Revenues in fiscal year 2022/23 and 2023/24.

Page 101 of 109

ELECTRIC FUNDSum of Amount Column LabelsRow Labels 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 Grand Total

Transmission 1,500,000$ 1,045,000$ 2,545,000 Transmission Line Reconstruction 1,500,000$ 1,045,000$ 2,545,000

Cass Road Substation to Cass Road Junction 615,000$ 615,000 1.66 Miles rebuild 615,000$ 615,000

Cass Road Junction to Hall Street Substation 430,000$ 430,000 1.17 Miles rebuild 430,000$ 430,000

Barlow Street Substation to Parsons Road Substation 1,500,000$ 1,500,000 2.71 Miles rebuild 1,500,000$ 1,500,000

Substation 350,000$ 1,525,000$ 850,000$ 2,725,000 Substation Transformer Upgrades 1,525,000$ 1,525,000

Cass Road #1 Transformer 750,000$ 750,000 Parsons Road #1 Transformer 775,000$ 775,000

Substation Improvements 850,000$ 850,000 Distribution Substation Relay Replacement 250,000$ 250,000 Transmission Substation Relay Replacement 600,000$ 600,000

Grand Traverse Substation Upgrades (Carryover) 350,000$ 350,000 Distribution 1,825,000$ 2,420,000$ 4,098,000$ 4,245,000$ 2,735,000$ 2,735,000$ 18,058,000

Hartman Road Overhead Tie 400,000$ 600,000$ 1,000,000 Extensions and New Services 750,000$ 800,000$ 850,000$ 900,000$ 950,000$ 1,000,000$ 5,250,000 Distribution Circuit Reliability Projects 250,000$ 1,363,000$ 1,325,000$ 250,000$ 85,000$ 3,273,000

Grandview Parkway 250,000$ 250,000 Install new 750 MCM CU URG & Padmount Equipment along Grandview Pkway & Behind BldgsNorth of Front St - 2.0 Miles 250,000$ 250,000

HL-33 Circuit 85,000$ 85,000 69 KV Underbuild along Wadsworth St from 5th to 13th St - .78 Miles 85,000$ 85,000

PC-22 Circuit 613,000$ 613,000 OH in back lot area from Parsons Rd to Munson Ave - .48 miles 113,000$ 113,000 OH Munson Avenue from Davis Street to 3 Mile Road - 1.43 Mile 500,000$ 500,000

PC-23 Circuit 525,000$ 525,000 Mitchell Creek 125,000$ 125,000 OH Munson Avenue from 3 Mile Road to 4 Mile Road - 1.19 Mile 400,000$ 400,000

CD-31/SS-30 Circuits 200,000$ 200,000 Smart Grid Automatic Restoration 200,000$ 200,000

HL-33 Circuit 400,000$ 400,000 Locust Street 400,000$ 400,000

PC-22 Circuit 300,000$ 150,000$ 450,000 OH to UG behind Tom's Market East Bay 150,000$ 150,000 R.O.W. s/o Munson from Ave B to Ave E 300,000$ 300,000

SS-31 Circuit 250,000$ 250,000 Crestwood 250,000$ 250,000

PC-32 Circuit 250,000$ 250,000 Aspen Dr Conversion 250,000$ 250,000

CD-24 Circuit 250,000$ 250,000 Sectionalizing 250,000$ 250,000

Overhead Line Improvements 500,000$ 550,000$ 600,000$ 650,000$ 700,000$ 750,000$ 3,750,000 Underground Line Improvements 425,000$ 475,000$ 525,000$ 575,000$ 625,000$ 675,000$ 3,300,000

TRAVERSE CITY LIGHT & POWER CAPITAL IMPROVEMENTS PLAN 2022

FISCAL YEARS

10/29/2021

Page 102 of 109

ELECTRIC FUNDSum of Amount Column LabelsRow Labels 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 Grand Total

TRAVERSE CITY LIGHT & POWER CAPITAL IMPROVEMENTS PLAN 2022

FISCAL YEARS

Smart Grid - Capacitor Banks (NEW) 180,000$ 180,000$ 360,000 Meter Purchases (NEW) 150,000$ 165,000$ 180,000$ 195,000$ 210,000$ 225,000$ 1,125,000

Facilities and Other 875,000$ 50,000$ 50,000$ 50,000$ 50,000$ 50,000$ 1,125,000 Hastings Service Center Facility Improvements 50,000$ 50,000$ 50,000$ 50,000$ 50,000$ 50,000$ 300,000 SCADA System Upgrade 250,000$ 250,000 Network Servers (NEW) 75,000$ 75,000 Building D Rehabilitation (Carryover) 500,000$ 500,000

Joint TCL&P, City of Traverse City and DDA Projects 1,000,000$ 825,000$ 1,340,000$ 750,000$ 3,915,000 Alley between State and Front Street - Overhead to Underground Conversion 375,000$ 375,000$ 750,000$ 1,500,000 East Front Street Underground Lighting Circuit (Carryover) 105,000$ 105,000 Upgrade Front Street Underground Lighting Circuits and Receptacles 1,340,000$ 1,340,000 Parkway Lighting (NEW) 520,000$ 450,000$ 970,000

Grand Total 5,550,000$ 4,820,000$ 4,148,000$ 4,295,000$ 4,125,000$ 5,430,000$ 28,368,000

Sum of Amount Column LabelsRow Labels 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28 Grand Total

Fiber 4,050,000$ 4,050,000$ 4,300,000$ -$ -$ -$ 12,400,000$ Fiber to the Premise 4,050,000$ 4,050,000$ 4,300,000$ -$ -$ -$ 12,400,000$

Grand Total 4,050,000$ 4,050,000$ 4,300,000$ -$ -$ -$ 12,400,000$

NOTES:1) THIS WORKSHEET IS FOR ILLUSTRATION PURPOSES AND ONLY IS SUPPLEMENTAL TO THE PLAN.

3)STREET LIGHTING PROJECTS ARE SUBJECT TO FUNDING REQUIREMENTS PER THE DECORATIVE LIGHTING POLICY AND STREET LIGHTING OPERATIONS AND MAINTENANCE POLICY.

2)ACTUAL FISCAL YEAR THAT A PROJECT MAY BE UNDERTAKEN MAY DIFFER FROM THE FISCAL YEAR DEPICTED IN THIS SPREADSHEET. DOLLAR AMOUNTS ARE ESTIMATES FOR INFORMATION ONLY AND ARE NOT A PART OF THE OFFICIAL PLAN.

10/29/2021

Page 103 of 109

SIX YEAR CAPITAL IMPROVEMENTS PLAN – 2022

ELECTRIC FUND

TRANSMISSION:

Transmission Line Reconstruction Location: Existing transmission corridor from Barlow Street Substation to Parsons Road

Substation, Cass Road Substation to Cass Road Junction, and Cass Road Junction to Hall Street

Substation.

Character: Overhead transmission facilities to include new poles and wire and portion of the

transmission line from Barlow Street to Parsons Road will be converted to underground.

Extent: Reconductor/rebuilding of existing 69kV transmission lines with new lines, higher

poles, and undergrounding portion of the line to bring circuits to current day standards and in

compliance with FAA regulations.

Fiscal Year(s): 2022-23 and 2027-28

SUBSTATION:

Substation Transformer Upgrade

Location: Cass and Parsons Road Substations

Character: Installation of higher rated transformers as recommended by Engineers.

Extent: Upgrade existing substation transformers for system reliability due to load growth and

age of transformers.

Fiscal Year(s): 2023-24

Substation Improvements

Location: All substations maintained by Light and Power.

Character: Installation of more advanced relays to allow for faster identification and clearing

of faults.

Extent: Upgrade existing equipment within the substation for system reliability.


Grand Traverse Substation Upgrades (Carryover)

Location: Keystone Road

Character: Installation of a new control system, breakers, and switches along with land

improvements of removing an unused foundation and expanding the fence perimeter.

Extent: Upgrade existing equipment within the substation for system reliability due to load

growth and age of equipment.


Page 104 of 109


DISTRIBUTION:

Hartman Road Overhead Tie

Location: Southwest portion of the service area

Character: Overhead and underground construction, poles, wires and related materials.

Extent: Allow a second feed into the circuit to enhance reliability.

Fiscal Year(s): 2024-25 through 2025-26

Extensions and New Services

Location: Throughout the entire service area

Character: Construction/replacement of services involving the use of wire, poles, meters,

cabinets, and transformers.

Extent: This is an annual project in which wages, benefits, and equipment charges are

capitalized for upgrades to existing services or installation of new customer services.

Fiscal Year(s): 2022-23 through 2026-27 (Annual Program)

Distribution Circuit Rebuild

Location: Throughout the entire service area

Character: Replace deteriorated overhead/underground facilities with new wire, conduit,

poles, etc. to include conversion of overhead facilities to underground as appropriate.

Extent: New circuits and upgrade of existing circuits to improve reliability and serve

anticipated growth to include undergrounding facilities as appropriate.


Overhead Line Improvements

Location: Throughout the entire service area.

Character: Accumulation of small construction/replacement projects of overhead distribution

facilities involving the use of wire, poles, meters, cabinets and transformers.

Extent: Annual Program for approved projects


Underground Line Improvements


Character: Accumulation of small construction/replacement projects of underground

distribution facilities involving the use of wire, poles, meters, cabinets and transformers.

Extent: Annual Program for approved projects


Page 105 of 109


Smart Grid – Capacitor Banks (NEW)


Character: Replacement of capacitor bank and controls with updated devices to allow for

remote controls to better regulate voltage and VAR throughout the system.

Extent: Capacitor banks throughout the distribution system


Meters (NEW)


Character: Replacement of non working meters and installation of meters at new locations.

Extent: Annual Program


FACILITIES AND OTHER:

Hastings Service Center Facility Improvements

Location: 1131 Hastings Street

Character: Site improvements to existing facility.

Extent: Improvements needed determined on an annual basis.


SCADA System Replacement

Location: 1131 Hastings Street and Substations

Character: Installation of new SCADA equipment.

Extent: Upgrade the system to allow it to interconnect with other related systems such as AMI,

billing, GIS, OMS and other technologies.


Building D Rehabilitation (Carryover)


Character: Renovation of existing building and site

Extent: Initially begin with architectural drawings accumulating ideas for the building to

maximize the potential use of the building for the utility’s business operations.


Network Servers (NEW)


Character: New servers for data back up and an additional two or three data center servers

Extent: Installation of new servers


Page 106 of 109


JOINT TCL&P, CITY OF TRAVERSE CITY, and DDA PROJECTS:

Alley between State and Front Street – Overhead to Underground Conversion

Location: Alley between State and Front Street

Character: Conversion of overhead distribution facilities to underground.

Extent: Remove all overhead lines and transformers and install new underground lines and

transformers. The utility may need to purchase easements/real estate to set equipment or

purchase vaults to set in alley right of way.

Fiscal Year(s): 2022-23 through 2023-24 and 2026-27

East Front Streetscapes Lighting (Carryover)

Location: Boardman Avenue to Holiday Inn

Character: New street lighting installations in conjunction with planned streetscape.

Extent: To be determined in coordination with the City.


Upgrade Front Street Lighting Circuits and Receptacles

Location: Downtown north and south along Front Street

Character: Upgrade circuit to accommodate increased load.

Extent: New conduit, wire, and addition of event outlets.


Parkway Lighting (New)

Location: Grandview Parkway

Character: Upgrade circuit and install new lighting infrastructure.

Extent: New conduit, wire, and replacement of light poles


FIBER FUND Fiber to the Premises

Location: Entire service area

Character: Fiber cable, engineering, and installation to accommodate running fiber to

residents and businesses.

Extent: Deployment of a fiber optic network to the community.


Page 107 of 109

Traverse City Light & Power - Electric Fund - 2.5% Rate Increase in Fiscal Years 2021/22, 2022/23, and 2024/25

Cash Flow Forecast Estimate Estimate Estimate Estimate Estimate Estimate Estimate

Fiscal Year: 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28

Receipts

Charges for Services 31,420,000$ 31,676,800$ 32,151,952$ 33,438,030$ 33,939,601$ 34,448,695$ 34,965,425$

PCR Increase - 157,100 158,384 160,760 167,190 169,698 172,243

PCR Decrease - (1,000,000) - - - - -

Load Growth Increase - 314,200 316,768 321,520 334,380 339,396 344,487

Base Rate Increase - 785,500 - 803,799 - - -

Other Operating Revenues 3,354,500 3,831,590 4,308,222 3,794,386 3,870,274 3,947,679 4,026,633

Non Operating Revenues 248,600 253,572 258,643 263,816 269,093 274,474 279,964

Transfers in - - - - - - -

Interfund Loan Repayment - 450,000 400,000 350,000 350,000 350,000 350,000

Total Receipts 35,023,100 36,211,962 37,118,817 37,846,233 38,428,967 39,020,848 39,622,022

Payments

Generation Expense 21,167,750 20,494,605 20,904,497 21,322,587 21,749,039 22,184,020 22,627,700

Distribution Expense 4,365,400 4,350,708 4,437,722 4,526,477 4,617,006 4,709,346 4,803,533

Transmission Expense 407,000 415,140 423,443 431,912 440,550 449,361 458,348

Metering & Customer Accounting 681,415 695,043 708,944 723,123 737,586 752,337 767,384

Conservation & Public Service 812,200 777,444 792,993 808,853 825,030 841,530 858,361

Information Systems 440,350 449,157 458,140 467,303 476,649 486,182 495,906

Administrative & General 926,300 944,826 963,723 982,997 1,002,657 1,022,710 1,043,164

Insurance 85,000 86,700 88,434 90,203 92,007 93,847 95,724

City Fee 1,748,000 1,782,960 1,818,619 1,854,992 1,892,091 1,929,933 1,968,532

Pension Adjustment 1,193,810 1,198,390 1,249,958 1,330,957 1,361,376 (750,000) (750,000)

Retiree Health Care Adjustment 392,426 127,000 129,540 132,131 134,773 137,469 140,218

Previous Retiree Health Funds Accumulated - - - - - - -

Timing of receivables/payables - - - - - - -

Capital Investments 4,559,800 5,550,000 4,820,000 4,148,000 4,295,000 4,125,000 5,430,000

Financial Statement Entry to cover (-) cash - Fiber Fund 110,874 (110,874) - - - - -

Interfund Loan to Fiber Fund 286,977 - - - - - -

Total Payments 37,177,302 36,761,099 36,796,013 36,819,533 37,623,764 35,981,735 37,938,870

Cashflow Surplus/Deficit (-) (2,154,202) (549,137) 322,804 1,026,700 805,203 3,039,113 1,683,152

Opening Cash & Investments Balance 11,948,517 9,794,315 9,245,178 9,567,982 10,594,682 11,399,885 14,438,998

Closing Cash & Investments Balance 9,794,315 9,245,178 9,567,982 10,594,682 11,399,885 14,438,998 16,122,150

Reserved Cash & Investment Balance 8,465,000 8,464,000 8,570,000 8,671,000 8,774,000 8,877,000 8,995,000

Unreserved & Undesginated Cash & Investment Balance 1,329,315 781,178 997,982 1,923,682 2,625,885 5,561,998 7,127,150

Page 108 of 109

To:

TCLP Board


Update on MPPA Projects

Staff wanted to provide you an update on various projects through Michigan Public Power Agency. Belle River Coal Project On October 13, 2021 DTE announced that it is ceasing all coal use at the Belle River Coal plant in St. Clair, Michigan no later than December 2028. This is at least two years earlier than the facility previously scheduled decommissioning date of 2030. Campbell 3 Coal Project Testimony was received on October 28, 2021. MPPA is planning on scheduling a project committee meeting in late November to discuss the testimony provided in the MPSC IRP case. An update is planned to be provided to the Board at the December 2021 Board meeting. Assembly Solar I Purchase Power Commitment – Shiawassee County – Ranger – 9.8 MW MPPA was successful with a FERC Filing resulting in a settlement that will enable MPPA to receive Reactive Supply and Voltage Control (regulates voltage levels) revenue for the Assembly Solar I Project. The revenue reduces the overall power costs from the Assembly Solar I Project that directly benefits Traverse City Light and Power end-use customers. MPPA is pursuing the same outcome for Assembly Solar II Project. Savion Solar Power Purchase Commitment – Calhoun County – 13.2 MW An amendment to the MPPA PPA is going before the MPPA Board on November 10, 2021 to allow the commercial operation date for the Savion Power Purchase Agreement to be extended from December 31, 2022 to December 31, 2023. This request by Savion was due to two national issues that are creating global solar module shortages/supply chain issues for the entire solar industry; the June 2021 Withhold and Release Order issued by the US Customs and Border Protection at the direction of the White House and the August 2021 Circumvention Claim filed at the U.S. Department of Commerce.

Page 109 of 109

Documents

A REGULAR MEETING TRAVERSE CITY LIGHT AND POWER …