2010-08-09-AC-min - Laserfiche WebLink

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August 9, 2010 Rob explained that the Town has an additional incentive to undertake this exchange program promptly. For some years now, NSTAR has undercounted the number of streetlights that are subject to charge. The number was reduced some years ago when the Town turned off a number of streetlights as a cost - saving measure, and when those streetlights were later turned back on, NSTAR failed to capture all of them in its billing system. The Town has made NSTAR aware of this issue, but until now NSTAR has not corrected its billing. NSTAR has told the Town that if it undertakes the bulb replacement project, it will defer billing for the full complement of streetlights until the project is complete. Presumably, if the Town decides not to do the replacement project at this time, NSTAR will immediately start to bill for the full complement going forward, although it is not expected to seek retroactive reimbursement. The annual cost of electricity for the full complement of streetlights at current rates is approximately $350,000, and the Town as a matter of prudence has budgeted this amount for FY2011. If a decision is made to go forward with this proposal, a major challenge will be the financing of the purchase and installation of the new bulbs and fixtures, particularly in the absence of a capital expenditure authorization approved by Town Meeting. The Town staff is currently exploring a "third party lease - purchase" arrangement, under which a third party financing company such as GE Capital would pay the up -front costs of the project and the Town would then make monthly lease payments out of the savings to its existing streetlight budget. Rob said that Town Counsel had advised that the Selectmen could approve such an arrangement without authorization by Town Meeting. One option would then be to seek Town Meeting approval at the next annual town meeting for a bond issuance whose proceeds would be used to buy out the lease, thus reducing the financing costs going forward. The committee was generally supportive of the project and its stated goal of lowering costs and increasing efficiency, but raised a number of questions and concerns that might be wise to address before deciding whether to go forward. Among those concerns were whether, regardless of the financing method and projected savings to be achieved, this might be considered a major capital expenditure that would require action in advance by Town Meeting; whether NSTAR might be willing to extend the deadline for completion of the project to allow the Town to pursue a more deliberative process; and whether it was wise to swap all streetlight bulbs at once as opposed to phasing them in so that they will not all reach their end of life at the same time. The decision whether to proceed with this project or not will likely be made by the Board of Selectmen at its next meeting in late August. Action by this committee is not required but Rob will pass on its views and concerns and try to get back with answers to the questions raised. Rob confirmed that a "test run" of the proposed replacement bulbs will be undertaken before any commitment is made to proceed with the project to make sure that the new bulbs will meet with community acceptance. 5. Miscellaneous. Minutes of the meetings held on February 8, February 17, June 7 and June 30, 2010 were approved. -2-