Loading...
HomeMy WebLinkAboutStaff Report 404-07City of Palo Alto City Manager’s Report 4 TO:HONORABLE CITY COUNCIL FROM: DATE: SUBJECT: CITY MANAGER DEPARTMENT: UTILITIES OCTOBER 29, 2007 CMR: 404:07 RECOMMENDATION FROM THE FINANCE COMMITTEE TO ADOPT A RESOLUTION TO AUTHORIZE THE CITY MANAGER TO PURCHASE ELECTRICITY CAPACITY PRODUCTS FROM MEMBERS OF THE NORTHERN CALIFORNIA POWER AGENCY IN AN AMOUNT NOT TO EXCEED $4 MILLION PER YEAR RECOlVIMENDATION The Finance Committee and staff recommend that Council adopt a Resolution to authorize the City Manager to purchase electricity capacity products from members of the Northern California Power Agency (NCPA) in an amount not to exceed $4 million per year. BACKGROUND In July 2002, the Council approved the Metered Subsystem (MSS) Ageement with the California Independent System Operator (CAISO), which would permit the City to receive electric transmission and related services (CMR: 298:02). The MSS Agreement with the CAISO requires the City and other NCPA member signatories to abide by applicable CAISO tariffs that may be updated and subsequently approved by the Federal Energy Regulatory Commission (FERC) from time to time. The CAISO is in the process of making changes to its tariff under the new Market Redesign and Technology Update (MRTU) tariff that awaits final approval by FERC and that is scheduled to take effect in April 2008. Under the ten:ns of the new MRTU tariff, the responsibility for maintaining sufficient local generation capacity to maintain transmission grid reliability is transferred from the CAISO to Load Serving Entities (LSEs) such as the City. When the MRTU tariff is implemented, the City will need to procure Local Resource Adequacy (LRA) capacity from generators located within CAISO-designated load pockets such as the San Francisco Bay Area or Stockton/Lodi areas. The adoption of the resolution will authorize the City Manager to procure LRA capacity products from NCPA members who have surplus LRA capacity in a timely manner and to meet the new tariff requirements. CMR:404:07 Page 1 of 2 FINANCE COMMITTEE REVIEW AND RECOMMENDATION The Finance Committee reviewed the staff recommendation on October 16, 2007 (CMR: 381:07, Attachrnent A). The Finance Committee unanimously approved a motion to a) support the City making sufficient capacity purchases to meet CAISO tariffs requirements, and b) to authorize the City Manager to purchase electricity capacity products from members of the NCPA in an amount not to exceed $4 million per year beginning in 2008. The motion expanded on staff’s original request to limit authorization to cover calendar year 2008 only. The expanded authority was recommended due to the need to make these capacity purchases on an ongoing basis. RESOURCE IMPACT Local capacity purchases could cost the City approximately $4 million per year starting in 2008. These cost estimates have already been included in the Electric Fund’s budgets for FY 07-08 and retail rate projections. If the cost of purchasing capacity frorn NCPA members exceeds $4 million per year, staff will return to Council to seek its approval to increase the authorized amotlnt. POLICY IMPLICATI ONS This recommendation is consistent with the Council-approved Utilities Strategic Plan to ensure a high level of system reliability in a cost-effective manner. ENVIRONMENTAL REVIEW These se~wices do not constitute a project Quality Act. for the purpose of the California Environmental ATTACHMENTS A: October 16, 2007 CMR to Finance Comrnittee (CMR: 381:07) B: Draft Council Resolution C: October !6, 2007 Finance Committee Meeting Minutes PREPARED BY:SHIVA SWAMINATHAN Senior Resource Planner DEPARTMENT APPROVALS: ~ yALERIE O. FONI~ ’,----’/Director, Utilities CITY MANAGER APPROVAL: CARL YEATS Director, Administrative Services EMI Y~A~d~I’--~ON ~,-- Assistant City Manager ~ CMR:404:07 Page 2 of 2 ATTACHMENT A City of Palo Alto City Manager’s Report TO:HONORABLE CITY COUNCIL ATTENTION: FINANCE COMMITTEE FROM: DATE: SUBJECT: CITY MANAGER OCTOBER 16, 2007 DEPARTMENT: UTILITIES CMR:381:07 ADOPTION OF RESOLUTION TO AUTHORIZE THE CITY MANAGER TO PURCHASE ELECTRICITY. CAPACITY PRODUCTS FROM MEMBERS OF THE NORTHERN CALIFORNIAPOWER AGENCY IN AN A3IOUNT NOT TO EXCEED $4 MILLION RECOMMENDATION Staff recommends that Council adopt a Resolution to authorize the City Manager to purchase electricity capacity products from members of the Northern California Power Agency (NCPA) in an amount not to exceed $4 million for the 2008 calendar year. BACKGROUND In July 2002, the Council approved the Metered Subsystem (MSS) Agreement with the California Independent System Operator (CAISO), which would permit the City to receive electric transmission and related services. The Council also authorized a number of ancillazy agreements with Pacific Gas and Electric Company (PG&E) mad NCPA to facilitate various transmission ~-id-related services (CMR: 298:02). The MSS Agreement with the CAISO requires the City and other NCPA member signatories to abide by applicable CAISO tariffs that may be updated and subsequently approved by the Federal Energy Regulatory Commission (FERC) from time to time. The CAISO has made considerable changes to its tariff under the new Market Redesign and Technology Update (MRTU) tariff that awaits final approval by FERC and that is scheduled to take effect in April 2008. Under the terms of the new MRTU tariff, the responsibility for maintaining sufficient local generation capacity to maintain transmission grid reliability is transferred from the CAISO to Load Serving Entities (LSEs) such as the City. When the MRTU tariff is implemented, the City will need to procure Local Resource Adequacy (LRA) capacity from generators located within CAISO-desiNaated load pockets such as the San Francisco Bay Area or Stocktot~Lodi areas or be allocated the backstop procurement costs incurred by the CAISO to make up a shortfall of capacity procured by LSEs. C1V[R:381:07 Page 1 of 3 DISCUSSION . In advance of implementation of the MRTU tariff, and although the mafl{et price associated with this new Ltb-’~ capacity product is uncertain, the CAISO has provided an initial allocation of LRA responsibility of roughly 80 megawatts (MW) for 2008 to the City. Of this total, approximately 10 MW to 15 MW could be satisfied through the City’s existing resources. Staff’s estimate for the cost of procuring LRA capacity up to the City’s CAISO-allocated responsibility is $4 million for calendar year 2008, and tMs amount was incorporated in the FY 07-08 and FY 08-09 budgets. Staff anticipates that the CAISO’s tariff related to LRA capacity allocation for 2008 will be approved by FERC in the coming months. On implementation of LRA tariff requirements, or to avoid anticipated CAISO backstop procurement costs, the City can pursue any or aI1 of tl~ee avermes to purchase and meet the requirements: a) purchase fi-om the City’s existing suppliers, with wMch the City has executed Electric Master Agreements (EMAs); b) purchase from NCPA pool members that have smplus LRA capacity; and c) purchase frorn all members of the NCPA Joint Powers Agreement (JPA) that have surplus LRA capacity. By approving the NCPA pooling agreement and contracts with EMA suppliers, the Council has provided staff the authority to transact with NCPA pool members and EMA suppliers. However, there is no conesponding Council-approved mechanism to transact with the fifteen other NCPA JPA members on a bilateral basis. The fifteen other NCPA JPA members are the cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Redding, Roseville, Santa Clara, Ukiah; and the San Francisco Bay Area Rapid Transit District, the Plurnas-Sierra Rural Electric Cooperative, the Port of Oakland, the Truckee Dormer Public Utility District, and the Turlock Irrigation District. To increase staff’s ability to competitively procure LRA capacity while managing costs in order to meet the City’s LRA capacity obligations under the MSS A~eement, staff recommends the following: Authorize the City Manager to transact in LRA capacity or related products from NCPA mernber-owned generation resources: a. The amount of the purchase will not exceed the mnount needed to meet the CAISO’s LRA capacity allocation to the City for calendm year 2008. b. The price will be determined by a cornpetitive selection process. c. The total purchase cost will not exceed $4 million. 2.The form of agreement will be jointly determined by NCPA members and City staff, and will be approved as to form by the City Attorney. The agreement will be substantially similar in form to the Draft Confirmation Agreement shown in Attaclmnent B. RESOURCE IMPACT LRA capacity purchases could cost the City approximately $4 million per year starting in 2008. These cost estimates have been included in the Electric Fund’s 2007-08 budget and retail rate projections. CMR:381:07 Page 2 of 3 POLICY IMPLICATIONS This recommendation is consistent with the Council-approved Utilities Strategic Plan to ensure a high level of system reliability in a cost-effective manner. ENVIRONMENTAL REVIEW These services do not constitute a project for the purpose of the California Environmental Quality Act. ATTACHMENTS A: Draft Resolution B: Draft Confirmation Agreement- Resource Adequacy Capacity PREPARED BY:DEBRA LLOYD, Resource Plarmer SHIVA SWAMINATHAN, Senior Resource Planner DEPARTMENT APPROVALS: VALERIE O. FONG Director o~ Utih~t’~es CITY MANAGER APPROVAL: EMILY ,t-IARRIS ON Assistant City Manager CMR:381:07 Page 3 of 3 NOT YET APPROVED ATTACHMENT A RESOLUTION NO RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO TO AUTHORIZE THE CITY MANAGER ON BEHALF OF THE CITY TO PURCHASE ELECTRICITY CAPACITY PRODUCTS FROM MEMBERS OF THE NORTHERN CALIFORNIA POWER AGENCY IN AN AMOUNT NOT TO EXCEED $4 MILLION WHEREAS, the Northern California Power Agency ("NCPA’) was formed in 1968 for the purpose of utilizing the joint action of participating public power entities to pursue common interests for the benefit of all such members; and WHEREAS, the NCPA Joint Powers Agreement ("JPA’) was :initially developed on July 19, 1968, and subsequently revised on April !, 1973; and WHEREAS, in addition to the City of Palo Alto (the "City"), the cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Redding, Rosevi!le, Santa Clara, Ukiah, and the San Francisco Bay Area Rapid Transit District, the Plumas-Sierra Rural Electric Cooperative, the Port of Oakland, the Truckee Donner Public Utility District, and the Turlock Irrigation District are signatory participants to the JPA; and WHEREAS, the City receives electric transmission services under the terms of the 2002 Metered Sub-System ("MSS") Agreement between NCPA and the California Independent Systems Operator ("CAISO’) ; and WHEREAS, the MSS Agreement requires the City and other NCPA members to abide by the applicable CAISO Tariff ("Tariff") that may be updated and subsequently approved by the Federal Energy Regulatory Commission ("FERC") from time to time; and WHEREAS, CA!SO has made considerable changes to its Tariff under the 2008 Market Design and Technology Update ("MRTU") Tariff, changes that include the obligation of the City to purchase Local Resource Adequacy ("LPJk") electricity capacity products; and WHEREAS, to abide by the MRTU Tariff, the City anticipates the need to purchase LRA electricity capacity products; and WHEREAS, to competitively procure LP~A electricity capacity products, the City has developed and adopted the contracting mechanism to transact with private sector suppliers, but it will need the contracting authority to transact with NCPA members; /! //NOW, THEREFORE, the Council of the City of Palo Alto does hereby resolve as follows: 070919 jb 0072931 NOT YET APPROVED SECTION i. The Council hereby authorizes the City Manager, or his desXgnee, the Director of Utilities, on behalf of the City, to negotiate one or more LRA electricity capacity product transactions with members of NCPA to meet the City’s 2008 electricity capacity obligations; these transactions shall meet the L~A obligation for calendar year 2008 and shall not exceed $4 million. SECTION 2. The Council finds that the adoption of this resolution does not constitute a project under the California Environmental Quality Act and the CEQA Guidelines and, therefore, no environment assessment is required. INTRODUCED AND PASSED: AYES: NOES: ABSENTIONS: ABSENT: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Mayor City Attorney City Manager Director of Utilities Director of Administrative Services 070919 jb 0072931 Attachment B: Draft Confirmation Agreement - Resource Adequacy Capacity Product for CAISO Resources This Confirmation Agreement (this "Confirmation"), executed as of (the "Confirmation Effective Date"), shall document the negotiated transaction (this "Transaction") between ("Seller") and ("Buyer"), each individually a "Party" and together the "Parties", in which Seller agrees to provide to Buyer the right to the resource adequacy capacity product described herein (the "Product"). This Transaction is governed by the Edison Electric Institute Master Power Purchase & Sale Agreement1, effective as of , along with any amendments and annexes thereto (the "Master Agreement"). Capitalized terms not otherwise defined in this Confirmation have the meanings specified in the Master Agreement. 1.Definitions 1.t."Applicable Laws" means any law, rule, regulation, order, decision, judgment, or other legal or regulatory determination by any Governmental Body having jurisdiction over one or both Parties or this Transaction, including without limitation, the Tariff. 1.2."Buyer" has the meaning specified in the introductory paragraph hereof. 1.3."CAISO" means the California Independent System Operator, or its successor. 1.4."CAISO Control Area" has the meaning Specified in the Tariff. 1.5."CAISO Controlled Grid" has the meaning specified in the Tariff. 1.6."Capacity Replacement Price" means (a) the price paid for any Replacement Capacity purchased by Buyer pursuant to Section 5.3 hereof, plus costs reasonably incurred by Buyer in purchasing such Replacement Capacity, or (b) absent a purchase of-any’ Replacement Capacity, the market price for such Designated RA Capacity not provided at the Delivery Point. The Buyer shall determine such market prices in a commercially reasonable manner. For purposes of Section 1.51 of the Master Agreement, "Capacity Replacement Price" shall be deemed to be the "Replacement Price." 1.7."Confirmation" has the meaning specified in the introductory paragraph hereof. 1.8."Contingent Firm RA Product" has the meaning specified in Section 3.3 hereof. 1.9. 1.10. "Contract Price" means, for any Monthly Delivery Period, the product of the RA Capacity Flat Price and the Price Shape for such period. "Contract Quantity" means the total Unit Contract Quantity for all Units. 1.! 1. "CPUC" means the California Public Utilities Commission. ~ This Confirmation could be adapted to lhe WSPP Agreement, but specific master agreement references are to the EEl. Page 1 of 15 1.12. 1.13. 1.14. 1.15. 1.16. ! .!9. 1.20. 1.21. "CPUC Decisions" means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, D.06-07-031 and subsequent decisions related to resource adequacy, as may be amended from time to time by the CPUC. "Delivery Period" has the meaning specified in Section 4.1 hereof. "Delivery Point" has the meaning specified in Section 4.2 hereof. "Designated RA Capacity" means, for each Unit, the amount of RA Capacity that Seller provides to Buyer pursuant to this Confirmation that is certified for inclusion in RAR Showings and if applicable LAR Showings, in each case as determined or approved by the CPUC (and/or, to the extent authorized by the CPUC, by the CAISO) pursuant to the CPUC Decisions, or by an LRA having jurisdiction. Designated RA Capacity shall include those attributes associated with the capacity identified in Sections 2 and 3 hereof. "Confirmation Effective Date" has the meaning specified in the introductory paragraph hereof. "Firm RA Product" has the meaning specified in the Section 3.2 hereof. "Governmental Body" means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. "LAR" means local area reliability, which is any program of localized resource adequacy requirements established for jurisdictional LSE’s by the CPUC pursuant to the CPUC Decisions, or by another LRA having jurisdiction over the LSE. LAR may also be known as local resource adequacy, local RA, or local capacity requirement in other regulatory proceedings or legislative actions. "LAR Attributes" means, with respect to a Unit, any and all resource adequacy attributes (or other Iocational attributes related to system reliability), as may be identified from time to time by the CPUC, CAISO, LRA, or other Governmental Body having jurisdiction, associated with the physical location or point of electrical interconnection of the Unit within the CAISO Control Area, that can be counted toward LAR, but exclusive of any RAR Attributes which are not associated with where in the CAISO Control Area the Unit is physically located or electrically interconnected. For clarity, it should be understood that the LAR Attributes associated with a Unit by virtue of its location or point of electrical interconnection may ch&nge as the CAISO, LRA, or other Governmental Body, defines new or re-defines existing LAR regions and such change will not result in a change in payments made pursuant to this transaction. "LAR Showings" means the LAR compliance showings (or similar or successor showings) an LSE is required to make to the CPUC (and, to the extent authorized by the CPUC, to the CAISO) pursuant to the CPUC Decisions, or to an LRA having jurisdiction over the LSE. Page 2 of 15 1.22."LRA" means a Local Regulatory Authority, as defined in the Tariff. For the City of Palo Alto it shall be the City Council. 1,23."LSE" means load-serving entity. LSEs may be an investor-owned utility, an electric service provider, a community aggregator or community choice aggregator, or a municipality serving load in the CAISO Control Area (excluding exports). 1.24."Maintenance Outage" has the meaning specified in the NERC/GADS Protocols. 1.25."Master Agreement" has the meaning specified in the introductory paragraph hereof. 1.26."Monthly Delivery Period" means each calendar month during the Delivery Period. 1.27."Monthly RA Capacity Payment" has the meaning specified in Section 4.4 hereof. 1.28."NERC/GADS Protocols" means the North American Electric Reliability Council (NERC) Generating Availability Data System (GADS) protocols, as may be updated from time to time. 1.29."Non-Excusable Event" means Seller’s (a) negligence, (b) failure to perform ils obligations under this Confirmation, including, without limitation, the failure to cause the owner, operator or SC of a Unit to comply with the operations and maintenance standards specified in Section 8.2.F, or (c) failure to comply, or cause the owner, operator or SC of the Units to comply, with the Tariff with respect to the Units providing RAR Attributes and LAR Attributes, as applicable. 1.30."Outage" means a Maintenance Outage, Planned Outage and Unplanned Outage, as defined by the NERC/GADS Protocols. 1.31."Planned Outage" has the meaning specified in the NERC/GADS Protocols. 1.32."Price Shape" means the Price Shape specified in the Monthly Capacity Price Shape Table in Section 4.4 hereof. 1.33."Product" has the meaning specified in the introductory paragraph hereof. 1.34."Prorated Percentage of Unit Factor" means the percentage of RA Capacity, as specified in Section 2 hereof, from the Unit that is dedicated to Buyer. 1.35."RA Availability" means, for each Unit, (a) the Unit’s Designated RA Capacity for a Monthly Delivery Period, divided by (b) the Unit Contract Quantity, provided that a Unit’s RA Availability shall not exceed 1.00. 1.36."RA Capacity" means the qualifying and deliverable capacity of the Unit for RAR and LAR purposes for the Delivery Period, as determined by the CAISO, or other Governmental Body authorized to make such determination under Applicable Laws. RA Capacity encompasses both the RAR Attributes and LAR Attributes of the capacity provided by a Unit. Page 3 of 15 1.37. 1.38. 1.39. 1.40. 1.43. 1.44. 1.45. 1.46. 1.47. 1.48. 1.51. "RA Capacity Flat Price" means the price specified in the Monthly Capacity Flat Price Table in Section 4.4 hereof. "RAR" means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, or by an LRA or other Governmental Body having jurisdiction. "RAR Attributes" means, with respect to a Unit, any and all resource adequacy attributes, as may be identified from time to time by the CPUC, LRA, or Governmental Body having jurisdiction, that can be counted toward PAR, exclusive of any LAR Attributes. "RAR Showings" means the RAR compliance showings (or similar or successor showings) an LSE is required to make to the CPUC (and/or, to the extent authorized by the CPUC, to the CAISO), pursuant to the CPUC Decisions, or to an LRA having jurisdiction. "Replacement Capacity" has the meaning specified in Section 5.3 hereof. "Replacement Unit" means a generating unit meeting the requirements specified in Section 5.2 hereof. "Resource Top Down Category" means the resource classification as described in CPUC Decision 05-10-042, and as may be amended from time to time by the CPUC. "RMR Agreement" has the meaning specified in Section 8.2.B hereof. "Scheduling Coordinator" or "SC" has the meaning defined in the Tariff. "Seller" has the meaning specified in the introductory paragraph hereof. "Supply Plan" means the supply plans, or similar or successor filings, that each Scheduling Coordinator representing RA Capacity submits to the CAISO, LRA, or other Governmental Body, pursuant to Applicable Laws, in order for that RA Capacity to count for its RAR Attributes or LAR Attributes. "Tariff" means the tariff and protocol provisions of the CAISO, as amended from time to time. "Transaction" has the meaning specified in the introductory paragraph hereof. "Unit" or "Units" shall mean the generation assets described in Section 2 hereof (including any Replacement Units), from which RA Capacity is provided by Seller to Buyer. "Unit Contract Quantity" means the quantity of RA Capacity for a Unit as of the Confirmation Effective Date, as specified in Section 4.3 hereof. Page 4 of 15 2. Unit Information~ Name: Location: CAISO Resource ID: Unit SCID: Unit CAJSO Net QuaJifying Capacity: Pro~:ated Percentage of Unit Factor: Resource Type: MW % Resource Top Down Category (1, 2, 3 or 4): Point of interconnection with the CAISO Controlled Grid ("Substation"): Current CAIS© Zone (NP15, ZP26, or SP15) in which Substation resides: ~ LAR Region (if any, as of Confirmation Effective Date): Deliverabilky restrictions, if any, as described in most recent CAISO deliverability assessment: Run Hour Restrictions: 3. Resource Adequacy Capac.it¥ Product During Delivery Period, Seller shall provide the Product to Buyer pursuant to the ~erms of this Confirmation. The Product shall (a) include both RAR Attributes and LAR Attributes, and (b) be a Firm RA Product or a Contingent Firm RA Product, as selected below. The Product does not confer to Buyer any right to the Contract Quantity from the Units, other than the right to include the Designated RA Capacity associated with the Contract Quantity in RAR Showings, LAR Showings if applicable, and any other capacity or resource adequacy markets or proceedings as specified in this Confirmation. Specifically, no energy or ancillary services associated with any Unit is required to be made available Io Buyer as part of this Transaction and Buyer shall not be responsible for compensating Seller for Seller’s commitments to the CAISO required by this Confirmation. Seller retains the right to sell any RA Capacity from a Unit in excess of that Unit’s Contract Quantity, and any RAR Attributes or LAR Attributes not otherwise sold under this Confirmation. 3.1. RAR and LAR Attributes Seller shall provide Buyer with the Designated RA Capacity and the RAR Attributes and LAR Attributes from each Unit, as measured in MWs. For each Monthly Delivery Period, a Unit’s Designated RA Capacity shall be equal to the product of (x) the Unit’s RA ~ To be repeated for each Unit if more than one. Page 5 of 15 Capacity, after reflecting adjustments for Outages, if any, as determined by the CPUC (and, to the extent authorized by the CPUC, by the CAISO), or by an LRA having iurisdiction, and (y) the Unit’s Prorated Percentage of Unit Factor, provided that the total amount of Designated RA Capacity from all Units shall not exceed the Contract Quantity. 3.2. [] Firm RA Product Seller shall provide Buyer with Designated RA Capacity from the Unils in the amount of the Contract Quantity. If the Units are not available to provide the full amount of the Contract Quantity for any reason other than Force Majeure, including without limitation any Outage or any adjustment of the RA Capacity of any Unit, Seller shall provide Buyer with Designated RA Capacity from one or more Replacement Units pursuant to Section 5.2 hereof. If Seller fails to provide Buyer with replacement Designated RA Capacity from Replacement Units pursuant to Section 5.2, Seller shall be liable for damages pursuant to Section 5.4 hereof, or Seller shall indemnify Buyer for penalties or fines pursuant to Section 5.5 hereof if Seller is not able to replace the Designated RA Capacity. 3.3. [] Contingent Firm RA Product Seller shall provide Buyer with Designated IRA Capacity from the Units in the amount of the Contract Quantity. If the Units are not available to provide the full amount of the Contract Quantity because of a Non-Excusable Event, Seller shall provide Buyer with Designated RA Capacity from one or more Replacement Units pursuant to Section 5.2 hereof. In such case, if Seller fails to provide Buyer with rep[&cement Designated RA Capacity from IReplacement Units pursuant to Section 5.2, Seller shaiJ be liable for damages pursuant to Section 5.4 hereof, or Seller shall indemnify Buyer for penalties or fines pursuant to Section 5.5 hereof. If the Units provide less than the full amount of the Contract Quantity for any reason other than a Non-Excusable Event, Seller is not obligated to provide Buyer with replacement Designated RA Capacityor to indemnify Buyer for penalties or fines pursuant to Section 5.5 hereof. 4. Delivery and Payment 4.1. Delivery Period The Delivery Period shall be: 4.2. Delivery Point The Delivery Point for each Unit shall be the CAISO Control Area and, if applicable, the LAR region in which the Unit is electrically inter:connected, 4.3. Unit Contract Quantity:3 The Contract Quantity of each Unit for each Monthly Delivery Period shall be: Unit Contract Quantity (MWs) 3 To be repeated for each Unit if more than one. Page 6 of 15 Month January February March April May June July August September October November December 2007 2008 2009 2010 If any portion of Ihe Unit Contract Quantity of any Unit providing a Contingent Firm RA Product is not available after the Confirmation Effective Date for reasons other than a Non- Excusable Event, the Unit Contract Quantity shall be adjusted to the product of the Unit’s (a) RA Capacity following adjustment, and (b) Prorated Percentage of Unit Factor, provided that the resulting Unit Contract Quantity shall not exceed the original Unit Contract Quantity on the Confirmation Effective Date. 4.4. Monthly RA Capacity Payment In accordance with theterms of Article Six of the Master Agreement, Buyer shall make a Monthly RA Capacity Payment to Seller for each Unit, in arrears, following each Monthly Delivery Period. Each Unit’s Monthly RA Capacity Payment shall be equal to the product of (a) the applicable Contract Price for that Monthly Delivery Period, (b) the Designated RA Capacity for the Monthly Delivery Period, and (c)1,000. The final product of this Monthly RA Capacity Payment calculation shall be rounded to the nearest penny (i.e. two decimal places). Each Monthly RA Capacity Payment may be subject to reduction in accordance with Section 4.5 hereof. MONTHLY CAPACITY FLAT PRICE TABLE Contract RA Capacity Flat Page 7 of 15 Year Price ($/kW-month) 2007 2008 2009 2010 The respective monthly Price Shape, set forth in the Monthly Capacity Price Shape Table below, shall apply throughout the entire Delivery Period. MONTHLY’ CAPACITY PRICE SHAPE TABLE Contract Price Shape Month (%) Jan Feb Mar Apt May Jun Jul Aug Sep Oct Nov Dec [ ............. 4.5. Reduction of Monthly RA Capacity Payment (Contingent Firm RA Product only) Page 8 of 15 For any Contingent Firm RA Product, the Monthly RA Capacity Payment for each Unit shall be reduced by its RA Availability Adjustment, which is calculated as follows: (a) When the Unit’s RA Availability for the Monthly Delivery Period is greater than or equal to 80 percent, the Unit’s RA Availability Adjustment shall be zero. (b) When the Unit’s RA Availability is greater than or equal to 50 percent, but less than 80 percent, the Unit’s RA Availability Adjustment shall be equal to: (.80 - RA Availability) * .50 * the applicable Contract Price for that Monthly Delivery Period Unit Contract Quantity * 1000. (c) When the Unit’s RA Availability is less than 50 percent, the Unit’s RA Availability Adjustment shall be equal to: (((.80 - .50) * .50) + ((.50 - RA Availability) * 1.00))* the applicable Contract Price for thai Monthly Delivery Period " Unit Contracl Quantity * 1000. The final product of this RA Availability Adjustment calculation shall be rounded to the nearest penny (i.e. two decimal places). The RA Availability Adjustment for each Unit shall be subtracted from the Monthly RA Capacity Payment determined in Section 4.4 to determine the amount due to the Seller for Designated RA Capacity provided hereunder from each Unit. In no case shall a Unit’s Monthly RA Capacity Payment be less than ze ro. 4.6. Allocation of Other Payments And Costs Seller may retain any revenues it may receive from the CAISO or any other third party with respect to any Unit for (a) start-up, shut-down and minimum toad costs, (b) capacity revenue for ancillary services, (c) energy sales, and (d) any future markets for black start or reactive power services. However, Buyer shall be entitled to receive and retain all revenues associated with the Designated RA Capacity of any Unit during the Delivery Period (including any capacity or availability revenues from RMR Agreements for any Unit, and Reliability Compensation Services Tariff capacity payments, but excluding payments described in clauses (a) and (b) above). All such revenues received by Seller, a Unit’s SC, owner, or operator shall promptly be paid to Buyer, and Seller shall indemnify Buyer for any such revenues that Buyer does not receive, and Seller shall promptly pay such revenues to Buyer if the Unit’s SC, owner, or operator fails to remit those revenues to Buyer. If a centralized capacity market develops within the CAISO region, Buyer will have exclusive rights to offer, bid or otherwise submit Designated RA Capacity provided to Buyer pursuant to this Confirmation for re-sale in such market, and retain and receive any and all related revenues. Page 9 of 15 5. Seller’s Failure to Deliver Contract Quantity 5.1. Notices and Filings If the Units will not be available to provide Designated RA Capacity in the full amount of the Contract Quantity for any RAR and/or LAR Showings for the Delivery Period, Seller shall, no later than the earlier of (a) twenty (20) Business Days from the loss of any Designated RA Capacity, or (b) fifteen (15) Business Days before the relevant deadline for such RAR or LAR Showing, notify Buyer of the Designated RA Capacity of each Unit which can be included in such Showings. Seller shall, on a timely basis, submit, or cause each Unit’s Scheduling Coordinator to submit, Supply Plans to identify and confirm the Designated RA Capacity of each Unit sold to Buyer. Seller shall cause the Unit’s Scheduling Coordinator to certify to Buyer, no later than the earlier of (a) twenty (20) Business Days from the Confirmation Effective Date, or (b) fifteen (15) Business Days before the relevant deadline for any applicable RAR or LAR Showing, that Buyer will be credited with the Designated RA Capacity for the Delivery Period in the Unit’s Scheduling Coordinator’s Supply Plan. Seller shall indemnify and hold harmless Buyer from any costs, monetary penalties or fines Buyer may incur in the event any Unit’s Scheduling Coordinator fails to timely submit Supply Plans that identify Buyer’s right to the Designated RA Capacity purchased hereunder. 5.2. RA Capacity from Replacement Units If Seller is required to provide Designated RA Capacity from one or more Replacement Units pursuant to Sections 3.2 or 3.3, Seller shall, at no cost to Buyer, provide Buyer with replacement RA Capacity from one or more Replacement Units, such that the total amount of Designated RA Capacity provided to Buyer from all Units and Replacement Units equals the Contract Quantity. The designation of any Replacement Unit by Seller shall be subject to Buyer’s prior written approval, which shall not be unreasonably withheld. For clarity, in the aggregate all Units and Replacement Units must provide to Buyer RAR Attributes and LAR Attributes equivalent to those that were provided by the original Units and that were sold under this Confirmation. Seller shall identify Replacement Units meeting the above requirements no later than the earlier of (x) twenty (20) Business Days from the loss of any Designated RA Capacity, or (y) fifteen (15) Business Days before the relevant deadline for Buyer’s RAR Showing and/or LAR Showing. ©nce Seller has identified in writing any Replacement Units that meet the requirements of this Section, any such Replacement Unit shall be automatically deemed to be a Unit for purposes of this Confirmation until Seller notifies Buyer, in writing, of the availability of the original Units. For purposes of this Confirmation, Seller shall be deemed to have failed to provide Buyer with Designated RA Capacity in the full amount of the Contact Quantity if the Units and Replacement Units providing such Designated RA Capacity do not in the aggregate provide to Buyer the RAR Attributes and LAR Attributes contracted for pursuant to this Confirmation. 5.3. Purchase of Replacement Capacity If Seller fails to provide any portion of Designated RA Capacity from Replacement Units as required by Section 5.2 hereof, Buyer may, but shall not be required to, replace any Page 10 of 15 Designated RA Capacity not provided by Seller with capacity (such replacement capacity being referred to as "Replacement Capacity") having equivalent IRAR and LAIR Attributes compared to the Designated IRA Capacity not provided by Seller. Buyer may enter into purchase transactions with one or more other parties to replace Designated IRA Capacity not provided by Seller. Additionally, Buyer many enter into one or more arrangements to repurchase its obligation to sell and deliver the Product to another party, and such arrangements shall be considered to be the procurement of IReplacement Capacity. Buyer shall act in a commercially reasonable manner in purchasing any IReplacement Capacity. 5.4. Damages for Failure to Deliver If Seller is required to provide Designated RA Capacity from one or more Replacement Units pursuant to Sections 3.2 or 3.3, and fails to do so pursuant to Section 5.2 hereof, then, for purposes of determining the damages due to Buyer under Section 4.1 of the Master Agreement, Seller shall pay to Buyer, in accordance with the terms of Section 4.1 of the Master Agreement relating to "Accelerated Payment of Damages," if applicable, an amount equal to the positive difference, if any, between (a) the sum of (i) the Capacity Replacement Price for each Replacement Capacity transaction entered into by Buyer times its applicable RA Capacity quantity, plus (ii) absent a purchase of Replacement Capacity, each Capacity Replacement Price times the Designated RA Capacity not provided by Seller (adjusted for any quantity purchased by Buyer in (i) above), and (b) the Designated RA Capacity not provided for each Monthly Delivery Period multiplied by the Contract Price for that month. 5.5. Indemnities For Failure to Deliver Designated RA Capacity Seller agrees to indemnify Buyer for any monetary penalties or fines assessed against Buyer by the CPUC or the CAISO, or an LRA having jurisdiction, resulting from: (a) Seller’s failure to provide Buyer with any portion of the Designated RA Capacity pursuant to Sections 3.2, 3.3, and 5.2 (including, without limitation, meeting the time requirements for designating any Replacement Units); (b) Seller’s failure to provide notice of the non- availability of any portion of the Designated RA Capacity as required under Section 5.1 hereof; or (c) any other failure by Seller to perform its obligations under this Confirmation. With respect to the foregoing, the Parties shall use commercially reasonable efforts to minimize such penalties and fines, provided that in no event shall Buyer be required to utilize or change its utilization of its owned or controlled assets or market positions to minimize these penalties and fines. Seller will have no obligation to Buyer under this Section 5.5 in respect of the portion of Contract Quantity for which Seller has paid damages pursuant to Section 5.4 hereof. 6. CAISO Offer Requirements: During the Delivery Period, except to the extent any Unit is on an Outage, or is affected by an event of Force Majeure that results in a partial or full Outage of that Unit, Seller shall either schedule or cause the Unit’s Scheduling Coordinator to schedule with, or make available to, the CAISO each Unit’s Designated RA Capacity in compliance with the Tariff, and shall perform all, or cause the Unit’s Scheduling Coordinator, owner, or operator, as applicable, to perform all, obligations under the Tariff that are associated with the sale of Designated RA Capacity hereunder. Buyer shall have no liability for the Page 11 of 15 failure of Seller or the failure of any Unit’s Scheduling Coordinator, owner or operator to comply with such Tariff provisions, including any penalties or fines imposed on Seller or the Unit’s Scheduling Coordinator, owner, or operator for such noncompliance. 7. Planned and Maintenance Outaqes For Contingent Firm Products, no later than January 15, April 15, July 15 and October 15 of each calendar year during the Delivery Period, and at least 60 days prior to the commencement of the Delivery Period, Seller shall submit, or cause the Unit’s Scheduling Coordinator to submit to Buyer each Unit’s schedule of proposed Planned or Maintenance Outages ("Outage Schedule") for the following twenty four (24) month period or to the end of the Delivery Period, whichever is shorter. Within twenty (20) Business Days after its receipt of an Outage Schedule, Buyer shall notify Seller in writing of any reasonable request for changes to the Outage Schedule, and Seller shall, consistent with Good Utility Practices, accommodate Buyer’s requests regarding the timing of any Planned or Maintenance Outages. Seller or the Unit’s Scheduling Coordinator shall notify Buyer within five (5) Business Days of any change to the Outage Schedule. A Planned Outage cannot exceed [X days to be negotiated] consecutive days in length (unless the Parties, prior to the first day of the Planned Outage, agree otherwise), and shall not be scheduled from each May 1 through September 30 during the Delivery Period. In the event that Seller has a previously Planned Outage that becomes coincident with a CAISO-declared system emergency, Seller shall make all reasonable efforts to reschedule such Planned Outage. Other Buyer and Seller Covenants Buyer and Seller shall, throughout the Delivery Period, take all commercially reasonable actions and execute any and all documents or instruments reasonably necessary to ensure Buyer’s right to the use of the Contract Quantity for the sole benefit of Buyer’s RAR and LAR if applicable. Such commercially reasonable actions shall include, without limitation: Cooperating with and providing, and in the case of Seller causing each Unit’s Scheduling Coordinator, owner or operator to cooperate with and provide, requested supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering RAR and/or LAR under Applicable Laws, to certify or qualify the Contract Quantity as RA Capacity and Designated RA Capacity. Such actions shall include, without limitation, providing information requested by the CPUC, or by an LRA having jurisdiction, to demonstrate for each month of the Delivery Period the ability to deliver the Contract Quantity from each Unit to the CAISO Controlled Grid for the minimum hours required to qualify as RA Capacity, and providing information requested by the CPUC, CAISO or other Governmental Body having jurisdiction to administer RAR or LAR to demonstrate that the Contract Quantity can be delivered to the CAISO Controlled Grid, pursuant to "deliverability" standards established by the CAISO, or other Governmental Body having jurisdiction to administer RAR and/or LAIR; and Page 12 of 15 8.2 ao Negotiating in good faith to make necessary amendments, if any, to this Confirmation to conform this Transaction to subsequent clarifications, revisions or decisions rendered by the CPUC, FERC, or other Governmental Body having jurisdiction to administer RAR or LAR, so as to maintain the benefits of the bargain struck by the Parties. Seller represents, warrants and covenants to Buyer that, throughout the Delivery Period: Ao Seller owns or has the exclusive right to the RA Capacity sold under this Confirmation from each Unit, and shall furnish Buyer, CAISO, CPUC or other jurisdictional LRA, or other Governmental Body with such evidence as may reasonably be requested to demonstrate such ownership or exclusive right; No portion of the Contract Quantity has been committed by Seller to any third party in order to satisfy RAR or LAR or analogous obligations in CAISO markets, other than pursuant to an RMR Agreement between the CAISO and either Seller or the Unit’s owner or operator; C.No portion of the Contract Quantity has been committed by Seller in order to satisfy RAR or LAR, or analogous obligations in any non-CAISO market; D.Each Unit is connected to the CAISO Controlled Grid, is within the CAISO Control Area, and is under the control of CAISO; In the event Seller has rights to the energy output of any Unit, and Seller or the Unit’s Scheduling Coordinator schedules energy from the Unit for export from the CAISO Control Area, or commits energy to another entity in a manner that could result in scheduling energy from the Unit for export from the CAISO Control Area, it shall do so only as allowed by, and in accordance with, Applicable Laws and such exports may, if allowed by the Tariff, be curtailed by the CAISO; The owner or operator of each Unit is obligated to maintain and operate each Unit using "Good Utility Practice," as defined in the Tariff, and, if applicable, General Order 167 as outlined by the CPUC in the Enforcement of Maintenance and Operation Standards for Electric Generating Facilities Adopted May 6, 2004, and is obligated to abide by all Applicable Laws in operating such Unit, provided that the owner or operator of any Unit is not required to undertake capital improvements, facility enhancements, or the construction of new facilities; G.The owner or operator of each Unit is obligated to comply with Applicable Laws, including the Tariff, relating to RA Capacity, RAR and LAR; H.If Seller is the owner of any Unit, the aggregation of all amounts of LAR Attributes and RAR Attributes that Seller has sold, assigned or transferred for any Unit does not exceed that Unit’s RA Capacity; 1.With respect to the RA Capacity provided under this Confirmation, Seller shall, and each Unit’s SC is obligated to, comply with Applicable Laws, including the Tariff, relating to RA Capacity, RAR and LAR; Page 13 of 15 J.Seller has notified the SC of each Unit that Seller has transferred the Designated RA Capacity to Buyer, and the SC is obligated to deliver the Supply Plans in accordance with the Tariff; and Seller has notified each Unit’s SC that Buyer is entitled to the revenues set forth in Section 4.6 of this Confirmation, and such SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues. 9. Confidentiality. Notwithstanding Section 10.11 of the Agreement, the Parties agree that Buyer may disclose the transfer of the Designated RA Capacity under this Transaction to any Governmental Body, the CPUC, the CAISO or any LRA having jurisdiction in order to support its LAR or RAR Showings, if applicable, and Seller may disclose the transfer of the Designated RA Capacity under this Transaction to the SC of each Unit in order for such SC to timely submit accurate Supply Plans; provided, that each disclosing Party shall, to the extent reasonable, use reasonable efforts to limit the ability of any such applicable Governmental Body, CAISO, LRA or SC to further disclose such information. 10. Assignment Buyer may sell, assign or transfer all or a portion of the Product without Seller’s consent, provided that the purchaser, assignee or transferee shall assume Buyer’s rights and obligations under this Confirmation. 11. Collateral Requirements 11.!. Seller Collateral Requirements Notwithstanding anything to the contrary contained in the Master Agreement, Seller shall provide to, and maintain with, Buyer a Full Floating Independent Amount as long as Seller or its Guarantor, if any, does not maintain Credit Ratings of at least BBB- from S&P and of at least Baa3 from Moody’s. The Full Floating Independent Amount shall be equal to $ [X% of the sum of the Monthly RA Capacity Payments for the current month and all remaining months of the Delivery Period, without the reductions specified in Section 4.5]. For the purposes of calculating the Collateral Requirement pursuant Paragraph 3 of the Collateral Annex4, such Full Floating Independent Amount for Seller shall be added to the Exposure Amount for Buyer and subtracted from the Exposure Amount for Seller. 11.2.Buyer Collateral Requirements Notwithstanding anything to the contrary contained in the Master Agreement, Buyer shall provide to, and maintain with, Seller a Full Floating Independent Amount as long as Buyer or its Guarantor, if any, does not maintain Credit Ratings of at least BBB- from 4 This Confirmation presumes the parties have executed a Collateral Annex to the EEl. If no such agreement exists, definitions used in the Collateral Annex need to be added to the EEl or otherwise provided within the Transaction. Page 14 of 15 S&P and of at least Baa3 from Moody’s. The Ful! Floating Independent Amount shall be equal to $ [X% of the sum of the Monthly RA Capacity Payments for the current month and all remaining months of the Delivery Period, without the reductions specified in Section 4.5]. For the purposes of calculating the Collateral Requirement pursuant Paragraph 3 of the Collateral Annex, such Full Floating Independent Amount for Buyer shall be added to the Exposure Amount for Seller and subtracted from the Exposure Amount for Buyer. 11.3.The Parties further agree that for the purposes of calculating the Collateral Requirement pursuant to Paragraph 3 of the Collateral Annex, the Current Mark-to-Market Value for this Transaction (as defined in Paragraph 1 of the EEl Collateral Annex) is deemed to be zero. If at any time prior to the expiration of the Delivery Period, a liquid market for an RA Capacity product develops wherein price quotes for such a product can be obtained from [X] independent, unaffiliated third parties, the Parties agree to amend the Confirmation to include a methodology for calculating the Current Mark-to-Market Value for this Transaction, consequently affecting each Party’s Exposure (as defined in Paragraph 1 of the EEl Collateral Annex). Notwithstanding anything to the contrary, the Parties shall determine the Settlement Amount for this Transaction in accordance with Section 5.2 of the Master Agreement. BUYER SELLER By:By: Name:Name: Title:Title: Date:Date: Page 15 of 15 NOT YET APPROVED ATTACHMENT B RESOLUTION NO RESOLUTION OF THE COU~’CIL OF THE CITY OF PALO ALTOTO AUTHO~ZE THE CITY MANAGER ON BEHALF OF THE CITYTO PURCHASE ELECTRICITY CAPACITY PRODUCTS FROM MEMBERSOF THE NORTHERN CALIFORNIA POWER AGENCY IN AN AMOUNT NOT TO EXCEED $4 MILLION PER YEAR WHEREAS, the Northern California Power Agency ("NCPA") was formed in 1968 for the purpose of utilizing the joint action of participating public power entities to pursue common interests for the benefit of all such members; and WHEREAS, the NCPA Joint Powers Agreement was initially developed on July 19, 1968, and subsequently revised on April 1, 1973; and WHEREAS, in addition to the City of Palo Alto (the "City"), the cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Redding, Roseville, Santa Clara, Ukiah, and the San Francisco Bay Area Rapid Transit District, the Plumas-Sierra Rural Electric Cooperative, the Port of Oakland, the Truckee Donner Public Utility District, and the Turlock Irrigation District are signatory participants to the JPA; and WHEREAS, the City receives electric transmission services under the terms of the 2002 Metered Sub-System ("MSS") Agreement between NCPA and the California Independent Systems Operator Corporation (’"CAISO"); and WHEREAS, the MSS Agreement requires the City and other NCPA members to abide by the applicable CAISO Tariff ("Tariff") that may be updated and subsequently approved by the Federal Energy Regulatory Commission ("FERC") from time to time; and WHEREAS, CAISO has made considerable changes to its Tariff under the 2008 Market Design and Technology Update ("MRTU") Tariff, changes that include the obligation of the City to purchase Local Resource Adequacy (°’LRA") electricity capacity products; and WHEREAS, to abide by the MRTU Tariff, the City anticipates the need to purchase LRA electricity capacity products; and WHEREAS, to competitively procure LRA electricity capacity products, the City has developed and adopted the contracting mechanism to transact with private sector suppliers, but it will need the contracting authority to transact with NCPA members; NOW, THEREFORE, the Council of the City of Palo Alto does hereby resolve, as follows: SECTION 1. The Council hereby authorizes the City Manager, or his designee, the Director of Utilities, on behalf of the City, to negotiate one or more LRA electricity capacity product transactions with members of NCPA to meet the City’s LRA electricity capacity obligations, beginning in calendar year 2008, and the cost shall not exceed $4 million per year. // 070919jb 0072931 NOT YET APPROVED SECTION 2. The Council finds that the adoption of this resolution does not constitute a project under the California Environmental Quality Act and the CEQA Guidelines and, therefore, no environment assessment is required. INTRODUCED AND PASSED: AYES: NOES: AB SENTIONS: ABSENT: ATTEST:-APPROVED: City Clerk APPROVED AS TO FORM: Mayor City Attorney City Manager Director of Utilities Director of Administrative Services 070919 jb 0072931 ATTACHMENT C Regular Meeting October 16, 2007 1.Oral Communications .....................................................................2 2.Discussion of Council’s Top 4 Priority "Sustainable Budget" (CIVlR:387:07) ...............................................................................2 3.Adoption of a Resolution to Authorize the City Manager to Purchase Electricity Capacity Products from Members of the Northern California Power Agency in an Amount Not to Exceed $4 Million (CMR:381:07) ....2 4.Report on the Status of Audit Recommendations ...............................2 5.City Auditor’s Fiscal Year 2007-08 Work Plan ....................................2 6.Auditor’s Office Quarterly Report as of September 30, 2007 ...............3 7.Discussion for Future Meeting Schedules and Agendas .......................3 AD_]OURNMENT ......................................................................................3 10/16/07 FIN: 1 Chairperson Morton called the meeting to order at 7:03 p.m. in the Council Conference Room, 250 Hamilton Avenue, Palo Alto, California. Present:Beecham, Klein, Norton (chair), Mossar Absent:None 1. Oral Communications None, 2. Discussion of Council’s Top 4 Priority "Sustainable Budget" (CMR:387:07) MOTION: Council Member Morton moved, seconded by Beecham, that the Finance Committee recommend to the City Council the Sustainable and Long Term Budget return as a Study Session in Early 2008. MOTION PASSED 4-0. 3. Adoption of a Resolution to Authorize the City Manager to Purchase Electricity Capacity Products from Members of the Northern California Power Agency in an Amount Not to Exceed $4 Million (CMR:381:07) MOTION: Council Member Mossar moved, seconded by Morton, that the Finance Committee recommends the City Council adopt a Resolution to authorize the City Manager to purchase electricity capacity products from members of the Northern California Power Agency (NCPA) to meet the CAISO tariff requirements in an amount not to exceed $4 million annually. MOTION PASSED 4-0. 4. Report on the Status of Audit Recommendations MOTION: Council Member Beecham moved, seconded by Mossar to continue audit report to the December 5, 2007 meeting and request the City Manager’s office to attend for explanation. MOTION PASSED 4-0. 5. City Auditor’s Fiscal Year 2007-08 Work Plan 10/16/07 FIN:2 MOTION: Council Member Mossar moved, seconded by Beecham, that the Finance Committee recommend to the City Council approval of the City Auditor’s Fiscal Year 2007-08 Work Plan. MOTION PASSED 4-0. 6. Auditor’s Office Quarterly Report as of September 30, 2007 MOTION: Council Member IVlossar moved, seconded by Morton, that the Finance Committee recommendrem to the City Council acceptance of the Auditor’s Office Quarterly Report as of September 30, 2007. MOTION PASSED 4-0. 7.Discussion for Future Meeting Schedules and Agendas December 5, 2007 December 11, 2007 AD_]OURNMENT: The meeting adjourned at 9:10 p.m. 10/16/07 FIN:3