Efficient Utilities for Rural Alaska

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Efficient Utilities for Rural Alaska

EFFICIENT UTILITIES FOR RURAL ALASKA JANUARY 11, 2001

Attendees: Sheila Selkregg (USDA Rural Development), Frank Muncy (USDA Rural Development), Steve Colt (ISER), Scott Ruby (DCED-RUBA), Mary Killorin (ISER), Amy Wiita (ISER), Charlie Walls (Denali Commission), Mark Foster (consultant), Lamar Cotten (DCED/AIDEA), Jamie Kenworthy (Alaska Science & Technology Foundation), Virginia Washington (St. Michael), Tom Coolidge (IHS), Johnny Adams (North Slope Borough), Brian Hirsch (ISER), Bill Gordon (Utilities Services of Alaska), Antony Scott and Nan Thompson (Regulatory Commission of Alaska), Steve Weaver (Alaska Native Tribal Health Consortium); Dan Easton (DEC), Joe Sarcone (EPA) and Jill Smythe (USDA Rural Development).

. Steve Colt opened the meeting at 10:15 am. He said that at the last Steering Committee meeting, the group decided they needed to meet again to refine some items. Steve noted that there has not been a whole lot of ISER activity since the December meeting except for some serious soul searching by ISER on what to do with time and resources to be devoted to the remainder of the project. Today is an opportunity to talk about where ISER needs to go to finish the project. . Jamie Kenworthy said discussions should include lessons learned and where we go from here. . Steve Colt said that there was very little time available to spend on Charlie Walls’ comments at the December Steering Committee meeting. He asked Charlie to explain his thoughts. . Charlie Walls said he felt that there was a need to focus on the core purpose of the study, i.e. identifying means of moving village utility operations toward sustainability. Charlie said that village utilities needed to demonstrate sustainability in terms of management, maintenance and a track record. If a village utility does not meet those standards, then intervention and corrective action need to be taken. Villages should be offered a menu of options, but the status quo should not be one of them. Charlie said that the options had parallels with commercial loan standards. Options could include signing up with RUBA, a work-out option, joining a regional organization, or some other umbrella organization. The goal should be to move dysfunctional utility systems toward a more sustainable mode. Charlie said that he was essentially paraphrasing RUS criteria for electric borrowers. He added that money going into a community needed to have strings on it. . Sheila Selkregg said that we need to move on to the next step of drawing conclusions. She said she wants a midway executive summary. She added that if it takes more resources, she is willing to talk about it. Sheila said that Commonwealth North is interested in this study, adding that the broader community is showing a lot of interest in Scott Goldsmith’s work. . Jamie Kenworthy said that he would like to hear from people with utility operational backgrounds on the economic sustainability issue. . Steve Colt said he had come up with two possible broad approaches and asked for the Committee’s comments. / \ / \ / \ assume fixed assume capacity will / could capacity improve / \ / \ $ capital $ capital / \ $ for operations $ for operations \ $ for capacity building

1 . Steve Colt handed out a couple of pages of notes and thoughts that he had put together on where ISER is on the project. He said that he wanted an informal and off the record discussion of where the project is going. . Brian Hirsch said we are trying to determine an incentive structure to improve efficiency so that sustainability is achieved. . Bill Gordon said that any utility receiving state or federal dollars should be regulated by the Regulatory Commission of Alaska (RCA). He noted that the RCA has the statutory authority to do this. . Steve Weaver said that we want to profile what a successful utility is. New EPA rules will assure that operating costs will double and there will be no more simple treatment processes. The tidal wave of regulation is upon us and will totally change water and sanitation utility operations. . Sheila Selkregg said that we need to come up with more than one scenario. . Steve Colt referred to the project scope of work that requires ISER to pick winners among generic concepts. Steve said he wants to move away from that, recognizing that the spread of costs is not consistent among single versus more sophisticated village utilities systems. . Jamie Kenworthy said that incentives need to be examined, noting that optimization of incentives has not been discussed by the Steering Committee. . Bill Gordon said that investment in maintaining utility condition is the critical concern. . Sheila Selkregg said that the project scope of work deals with capacity, efficiency and sustainability issues. She noted that the term “efficiency” includes a recognition that this is a subjective concept based on in-place or community values. We are not just dealing with an economic model. . Jamie Kenworthy said that a village’s view of efficiency might be different from that of government agencies. What do we think about it? Which efficiency are we going to buy? . Sheila Selkregg said that when we are talking about utilities, running an economically sustainable utility is a priority. However, recognizing the value of utility jobs in rural Alaska, certain situations (e.g. North Slope situation) are also important. She said there is a need to be honest about integrating local values and finding a balance with efficiency. . Nan Thompson asked how do we measure efficiency when employment is part of the equation? She noted that RCA’s system is good at measuring numbers and finances, but that it does not looking at values other than fuel efficiency. . Steve Colt said that we are all looking for sustainability as a goal, noting that the present inflow of dollars is not sustainable in long term. Steve added that he sees the pursuit of efficiency as a way we can try to get to sustainability with fewer dollars. He said that the crux of the problem is that if something is identified that looks more cost efficient, what are the social and cultural and even economic (non-utility) trade-offs for taking that route? How much added cost is there? . Brian Hirsch said that in terms of studying something that is fixed, ISER will assume that the institutional structure within any given community is somewhat fixed, either regional or individual, or other. This study is not going to change that or necessarily even address it. It will be looking at the role of individual utilities in communities and determining how policies can support and address specific goals. Getting around the definition of efficiency, what is there within the community that is the perceived mission of the utility and what are the external policy goals in terms of tweaking the structure, e.g. reduced federal dollars into the community, etc. . Steve Colt disagreed with portions of Brian Hirsch’s statement. He emphasized that ISER will absolutely not be assuming that the institutional structure for utilities will not change. . Jamie Kenworthy said that we do not have a charter to worry about sustainable communities, except that we cannot have sustainable communities without sustainable utilities. . Sheila Selkregg said she agreed but thinks the two are interrelated. That is why she likes the two-branch approach proposed by Steve Colt. She said that the second branch could address the “healthy community” approach. There is a relationship between utility management and overall community management. She said that we do not want to produce a document that assumes that rural Alaska will always respond to economic stimuli. What incentives might be to improve community capacity?

2 . Joe Sarcone said that a number of relevant studies have been generated within the past year, including the Rural Governance Commission report. These studies contain observations that connect with sustainability. Joe added that leadership in governance relates to a community’s ability to manage anything, of which utilities are only one part. In terms of words like efficiency, sustainability, capacity, etc., Joe cited one idea designed to improve efficiency at the local level in terms of revenue collection. That was, why doesn’t AVEC do the collections so village people don’t have to deal with it? At the time, everyone thought it was a pretty good idea that could work. However, the difficulty was in finding villages that were interested and willing to participate. One year later, there were no buyers. Joe cited St. Michael as another type of example. ANHB partnered with St. Michael. People in this village said they had tribal and city councils, both with agendas that were already full. The community said that it needed money from ANHB to pay local city and tribal councils to get together to talk about the new water and sewer system for a year. ANHB did this, and the councils met and formed a utility board. Joe said that there are problems when someone outside the village (e.g. Village Safe Water, etc.) determines what capacity means for capital improvement projects in order to be considered for funding. He said that the capacity of villages fluctuates and always will. This is a given. By saying that AVEC will handle collections or villages need to meet certain criteria, there will always be degrees of inefficiency and failure. If the situation were turned around, agencies would work with a community at any point on the continuum. They should then ask what is it that you think would be most helpful to improve the operation, management of your utility and we will work with you and be patient and come up with something. In other words, the “arrows” should lead out rather than in. . Sheila Selkregg said that the Steering Committee has had a lot of discussion about different approaches that could be used. Now, we need to move through the information to: 1) come up with a practical process that talks about essential issues for efficient, sustainable rural utilities; 2) determine what are incentives and disincentives; and 3) what Joe Sarcone is talking about needs to be addressed somewhere. She said she was looking for agreement among Steering Committee members. . Jamie Kenworthy said he was interested in listening to people who operate and pay for utility systems. . Steve Colt said we need to try to crystallize the differences between concepts outlined by Joe Sarcone and Charlie Walls. He asked Joe if he knew of systems that would be detrimental to the efficiency of a community if utility functions were taken away because it was said they are best run by a regional entity. A caveat might be that in the long term, the community could have them back. Steve asked if by doing this, would you be hampering community empowerment plus local control and development mentioned by Joe Sarcone. . Nan Thompson asked if that wasn’t more of an option that is already available, i.e. a choice that a community should be allowed to make. . Sheila Selkregg said that the intent of this work is not focused on either Joe’s or Charlie’s concerns. The intent is grounded in true costs, efficiency and the cultural and social realities of rural Alaska. She asked the Steering Committee to look at the original RFP. We need to look at a structure that allows concepts to interact and is understandable, and to develop policy that recognizes these issues. . Joe Sarcone said that his experience is that every contact in rural areas with a village, from a phone call to written reports, has the opportunity to augment or diminish local leadership in government. Our task is to make sure that we come up with something that augments local government leadership because that is where sustainability lies. If we do not do this, we will have missed the mark. . Steve Weaver commented that the Steering Committee could spend the whole day making social judgements. We are talking about single village, single utility, consolidated utility, and regional utility systems. Steve drew a one-axis graph on the blackboard. Looking at villages from an economic analysis perspective, as the local capacity goes up, the ability to use any system increases. If the capacity is low, none of the systems will ever work unless someone else does it. Size, customer base, etc. set the point on the scale where the capacity of a particular community or utility is. On the subject of setting the bar on what can be

3 accomplished, Steve said that indicators should be used when agencies go into a community to set grant availability, set subsidy, priority for government assistance, etc. However, there has to be local buy-in to the process. When asked, Steve said there was no horizontal axis for his graph. In setting a point where a community is on the chart, the local community needs to review the criteria and set its own point on the scale. . Sheila Selkregg said that many studies have been done on big school/little school and big community/little community situations. There are a fixed number of people needed for particular jobs. These can be maintained at a smoother level in a larger community. In smaller communities, there is often no back-up. . Jamie Kenworthy asked about goals for sustainability at both the utility and community levels. He said there is a need to define the purpose of public funds. Otherwise, it will be difficult to ISER to measure success. . Sheila Selkregg went back to the RFP. She said that this group is intended to bring out information that politicians may not want to hear. We should not be reluctant to discuss things because of their political nature. She added that the issue of community capacity is not a political issue, it is a fact. . Joe Sarcone said that any place is a good place to start in a village, provided that is where the village wants to start. . Jamie Kenworthy said if you can’t define the goal, then you can’t test the experiment. He added that the Steering Committee was here to figure out the sustainability of a utility. . Bill Gordon said that sustainability of a utility does not center on social issues. It has more to do with ensuring that operating revenue exceeds operating expenses, etc. . Sheila Selkregg said that there is a need to include social issues as well, i.e. community capacity and sustainability. . Nan Thompson referred to a two-step process, i.e. successful management structures and what incentives can maximize those structures. She asked how do you account for things that are difficult to measure? . Steve Colt asked what are the rewards and punishments for different actions? . Nan Thompson asked if all communities aim to improve to a 4 (highest) level? Will incentives be created for villages to move up? . Steve Colt asked if managing the utility is one of the ways for moving from 1 to 4 or should this option be taken away for a time. . Sheila Selkregg said that USDA Rural Development expects improvement in communities. The agency does not support system failures. The systems are too expensive. . Jamie Kenworthy asked if this is a community development or a utilities program. . Steve Colt referred to the Canadian system of tying improvements to population, e.g. a hockey rink for 5,000 people. He said perhaps it would be possible to tie different utility system technologies to different levels of community capacity. Communities could either elect to work to achieve the required level of capacity or tie-in to another technological model. . Sheila Selkregg said that if communities do not have the capacity but want an improved utility system, it would provide some teeth to interaction. . Dan Easton said that Village Safe Water is headed toward the type of model posed by Steve Weaver. He said that ANTHC/DEC operate a $94 million incentive system. The way that funds are granted to communities is an exercise in clout, e.g. requirement for certified water and sewer operators and back-ups. He said it would help Village Safe Water if this study would tell him how to measure capacity and how to decide what the relationship is between capacity and types of systems, both in terms of management structure and technical elements. Specific statements are needed in order to know how to rank applications for Village Safe Water funding to invoke that structure. . Steve Weaver commented that ANTHC manages a construction, not a management, operation. However, he said he agreed with Dan Easton’s statements. . Scott Ruby referred back to the issue of sustainability. He said villages need to be told that certain criteria need to be met and the community itself needs to determine how it does that. In other words, villages, not government agencies, decide social implications. All we can do is to set a goal that needs to be met. If communities are lacking in certain areas, we can assist. Scott added that the funding mechanism is the biggest disincentive to sustainability

4 right now. Sustainability issues have never really been adequately explained to communities. Scott cited an example of the Tuluksak washeteria. This was built but has not been used because the community recognized it was not ready to operate and be responsible for it. Scott said that villages often do not understand what the different utility systems entail in terms of performance, e.g. water testing, operators, etc. . Steve Colt asked if a utility had to have debt service for long term viability. He said there was a need to define requirements for success. . Steve Weaver said he preferred the term “indicators” to “requirements”. . Jamie Kenworthy asked Dan Easton how money equates with need for water and sanitation systems. . Dan Easton said that anyone could apply for Village Safe Water funding. Village Safe Water tries to create an incentive system so that applicants meet the criteria for a good project or they go away because they agree they did not meet the criteria. . Jamie Kenworthy asked how do we construct goal of sustainability so that agencies and communities can have a conversation among equals. The more that is done to construct an incentive system, the better the villages will be able to sort themselves out and decide the path that they wish to pursue. . Sheila Selkregg said that it is USDA’s intent to recognize incentives to reward communities that are making changes to position themselves for success. The design is to augment leadership. . Jamie Kenworthy used a Home Depot analogy for utility system choices and said that communities often need more information before they can make good decisions. . Virginia Washington said that communities sometimes do not get the type of system they want because of the geography. In the case of St. Michael, the community wanted a gravity flow sewer system. However, this type of system was not feasible, so the village had to go to a vacuum sewer system. She noted that St. Michael first did a household survey to see if people would pay for a vacuum sewer system. . Joe Sarcone said that over $1 billion had been put into water and sewer infrastructure in rural Alaska. The effects of that investment go way beyond water and sewer systems. It affects road building, fuel storage, culture (substitution of traditional water sources) and other aspects of life. It is not just a question of construction management or putting pipes in the ground. It is necessary to also think about how systems impact the local economy and lifestyles. Joe said that villages also have to put up with the accounting system of the U.S. and noted that there will always be some system failures.

LUNCH (courtesy of Jamie Kenworthy)

. Sheila Selkregg said that the Steering Committee needed to focus on answering Steve Colt’s questions and needs about what to measure in the villages. She identified three core areas of the study – sustainability, capacity and efficiency and noted that it is recognized there are incentives that can change outcomes. Sheila said that she is Interested in incentives that lead toward capacity building and sustainability. She referred to Steve Weaver’s one-axis graph, which shows that local capacity occurs along a continuum. Depending on where one is on the continuum, there should be a series of best practices for any given village. The goal is the delivery of efficient utility services. Sheila said she recognized that one way to look at this might be to say that in some cases we do not have control or cannot impact capacity, but there are specific incentives that could result in a more efficient system. The other model would say that capacity is so important that we want an interactive relationship between capacity and efficiency at the same time. The goal then gets back to identifying incentives that result in increased capacity and efficiency so that we have a sustainable utility in the context of the utility, recognizing there is a direct relationship between community and utility sustainability. She stressed that this study needs to focus on utility sustainability. . Steve Colt said that there is a need to pin down what indicators of sustainability are. Also, there is a need to talk about the time dimension to be considered. Steve said that Village Safe Water currently has an annual capital budget of $94 million. If these funds were no

5 longer available after ten years, it could lead to radically different conclusions about what is and is not sustainable. . Steve Weaver said that the issue should be viewed in terms of today’s funding environment because that is real. ISER’s report should be able to help ANTHC write about conditions today rather than theorizing about what might or might not happen in 10 years. . Steve Colt referred to the issue raised by Charlie Walls of replacement of capital on a long- term basis as an indicator of sustainability. He said it is known that villages typically do not pay for the initial construction of a vacuum sewer system. What level(s) of outside assistance should be assumed in deciding whether or not a utility is sustainable? . Nan Thompson asked if ISER was assuming that things within the village would stay the same economically? . Jamie Kenworthy said that Scott Goldsmith had shown that village economies are not going to fundamentally change in the future. . Steve Colt asked if it would be reasonable to assume that current capital funding for water and sewer utilities ($94 million per year) and current levels of PCE funding continue forever. Beyond that, ISER can make assumptions but cannot make a forecast. . Sheila Selkregg said that as long as Senator Stevens is on the Senate Appropriations Committee, current funding levels will continue. . Jamie Kenworthy suggested a “Stevens forever” scenario, a moderate scenario (4 Dam Pool) and a worst case scenario. . Brian Hirsch said that if the final outcome of study is recommended incentives/policies, they would be somewhat generic and independent. He said that the actual amount of money is not all that important, unless it is zero when there would be no incentives. . Steve Colt said that sustainability in the larger picture needs to be considered to see if there are enough resources for villages to have piped systems that can be replaced on a regular basis. If we start having guidelines or incentives for a community’s ability to support a particular technology, it is clear that the amount of external resources that will flow in is probably the critical assumption. He added that it would be irresponsible for ISER to ignore capital costs. . Sheila Selkregg said that Senator Stevens helps appropriate capital funds for new systems. She asked isn’t the issue of sustainability a fixed issue? Sheila added that we still have to figure out a sustainable strategy. . Steve Colt said that there are two levels of sustainability. First, can we sustain utility systems going in right now? At the second level, can we put aside money or generate money to replace the capital investment? Do we want to go into the second realm? . Sheila Selkregg said that we do. . Steve Colt asked what is the design life of a vacuum piped sewer system. . Steve Weaver said “it depends.” There are systems that have lasted 6 months and systems that have lasted 35-40 years. Steve gave the example of the Noorvik system, which was built in 1972 and has been refurbished periodically ever since. . Steve Colt asked if it might not be right to look at the design life. . Charlie Walls said that a hydro project has a predictable life and a replacement fund is set up on that basis. He then referenced the Noorvik water/sewer system and said that a renewal and replacement fund was needed to renew the system every 8 years. Charlie said that the overhaul of diesel engines in a power plant is a predictable need that costs money. A renewal fund needs to be set up to overhaul the engines. He said that AVEC captures renewal funds through depreciation tied into the service life. By this means, it has been able to accumulate cash to cover extraordinary or renewal items as they come due. . Steve Colt asked what the Noorvik renewal and replacement tab comes to every 8 years. . Tom Coolidge said he did not know the exact figure, but he knows that it is cheaper than replacing pipe systems. . Steve Weaver and Scott Ruby both said that some external funding would be required. . Charlie Walls said that in the case of electric power, a utility can collect funds through rates to recapitalize the system. . Sheila Selkregg said that sustainability requires some renewal and replacement costs.

6 . Steve Weaver said that the normal practice for water/sewer systems is to assume heavy outside assistance. . Jill Smythe suggested Venetie could provide an example of optimal sustainability in a single community because it has largely parallel utility systems (school and village). . Steve Weaver said that 30-40 years was a typical “life” for water/sewer systems. . Steve Colt said that he would be conservative and use a 30-year life. . Charlie Walls said that a service life of 30 years is normal for power plants. An exception is hydro projects which are expected to last as long as 50 years. . Steve Colt asked what would be considered sufficient renewals or replacements for a 30-year design life for a water/sewer system. . Steve Weaver said that a 5-year cycle would be appropriate and a reasonable expectation for replacing moving parts in a water system. He added that pumps might need to be replaced more often. . Charlie Walls asked what that would cost every 5 years. . Steve Weaver said that if he was talking about 20 horsepower vacuum pumps, he would be talking about “bucks”. . Sheila Selkregg said that having this information available for a community would be a good idea. . Steve Colt asked what Village Safe Water would pay for versus what the village would pay for. . Charlie Walls said that the utility should have adequate money set aside for these expenses. . Steve Colt asked what is maintenance and what is capital? . Scott Ruby said that RUBA uses a 10-year cycle. If a system breaks down in less than ten years, it is the responsibility of the community. If more, it is a capital cost. . Steve Weaver said that historically, systems have been run through all the redundancies and then replaced as a capital project. . Joe Sarcone said even communities that have demonstrated the highest level of operations, management and maintenance capability run into trouble with items such as major pump replacement, even though they can keep up with day to day costs. He said that he was referring to communities with 95% revenue collection rates, etc. . Steve Colt said that ISER will use RUBA’s 10-year standard and a 30-year life cycle. . Bill Gordon said that if communities try to go beyond the design life of equipment and are dependent on government grants for assistance, they will not be able to get pumps or other equipment in time to save the systems and the systems will fail. Utilities need to withhold funds in their rates, so that they can make judgements on needed expenditures at the local level. . Steve Colt said he does not think that any rural utility in Alaska is generating that kind of revenue. Even AVEC is participating in PCE. . Bill Gordon said that rural utilities cannot be built without a subsidy anywhere in the country, especially in an Arctic environment. An ongoing subsidy should be incorporated into utility operating budgets. However, funds also need to be withheld for depreciation, etc. so that there are not ongoing needs for capital for system replacements. . Charlie Walls said that whether they know it or not, village utilities are already part of a regional system, run by AVEC, the State or the federal government. He noted that Remote Maintenance Workers who serve so-called stand-alone water and sewer utilities are paid for by the State. This umbrella system is already in place, but is not really recognized. Charlie added that Remote Maintenance Workers do not have the needed resources and the program can be characterized as more of a Band-Aid approach. Villages cannot afford these things without help. It needs to be more generally recognized that there is a responsibility for operations and maintenance. This is going on, but on a catch as can basis. Charlie referred to Greg Capito’s definition of success for the Remote Maintenance Worker program is that there have been no system failures in the past 4 years. Charlie said that he would argue that there is no such thing as a single village utility. All of them need to be supported in some manner or another.

7 . Joe Sarcone said that Sharman Haley’s conclusions were the same as those of Bill Gordon. He added that it is probably not possible for village systems to be operated independent of outside assistance. . Sheila Selkregg asked what is the most efficient way for subsidizing the systems and how are the subsidies best placed? . Jamie Kenworthy said that when ISER looks at incentives, it needs to be neutral as to whether the incentives are capital or operating. This was generally agreed to be correct. . Tom Coolidge said that the systems are already subsidized. Using capital funds to rebuild systems is a subsidy. When discussing options in a community, one cannot say that the true cost is “x “ versus “y” because the community does not pay those costs. . Jamie Kenworthy said that ISER should also be neutral on the revenue side. . Sheila Selkregg said that if ISER finds it is cheaper to spend capital funds on operations and maintenance, perhaps there are other ways of funding those projects with federal money. She added that this could require changes at the national level. . Frank Muncy said that on a scale of 1-10, some utility projects at the 1-3 level could be funded. However, the construction portion of projects in such communities should not be funded until the capacity is there. Instead, the funds should be used for setting up the utility and other capacity building issues. He added that he would hate to fund construction projects where there is no local capacity. . Steve Weaver said that there are statutory issues because operations and maintenance has not been funded through the Indian Health Service even though there is a mechanism to do so (Indian Health Amendments of 1992). There is a clear and consistent policy that says there are millions of dollars for construction and none for operations and maintenance. . Bill Gordon said that if operations and maintenance costs, including depreciation, are built into the rates, customer rates can be broken out into different classes, e.g. commercial and residential rates. The former will pay a larger share of the costs. If the rates are real, utility costs will be paid through real rate structures based on cost of service studies. Rates can be allocated where they belong and can help subsidize the households, e.g. $1,000 a year. This subsidy would be quantifiable and measurable because it is in the rates. If validated by RCA, each village should be able to avoid the cycle of emergency repairs and replacements and would be able to control their own destiny. . Nan Thompson said that Bill Gordon was basically describing PCE. She said that Universal Services was a possible alternate source of funds and referenced their use to help subsidize telephone systems. . Amy Wiita said that a source in Canada’s Northwest Territories had said that they figure out what the fixed rate is and base their levels of subsidy on what the people can bear, similar to what Bill Gordon was proposing. . Steve Weaver said that this was 87 cents on the dollar last time he heard. . Amy Wiita said that the subsidy costs have reached a point beyond Canada’s ability or willingness to pay and how to deal with the gap is currently an issue. . Brian Hirsch referred to the field visits to the 6 selected villages. He said that the types of information obtained from site visits are qualitatively rather than quantitatively, different. . Sheila Selkregg referred to the dots measuring capacity and said that village perspectives change how she thinks about things. She said that understanding how the decision-making process works in the different villages is important. She added that field visits offer a possibility to gain insights from the perspective of a community dealing with what it is like to interact with the existing format of delivery. . Jamie Kenworthy said that ISER should only visit villages to check clarity of the data. . Steve Weaver said that people in the RUBA and Remote Maintenance Worker programs know the communities and what works and what does not work. . Joe Sarcone said that if ISER relies on input from the RUBA and Remote Maintenance programs, it would lose the perspective of the community. Instead, it will get the perspective of the RUBA and Remote Maintenance Worker personnel. . Steve Colt said that ISER had originally budgeted for 2 visits to each village, but now is down to one visit to each. He said that field visits are used to try to fill in the picture. This includes identifying the utility facilities in place, trying to identify their cost (who paid for them), the role

8 the community played in deciding how the systems came to be there, what was their true cost to put in place, what is the true cost of running them, do the rates cover the costs, collection rates, and how the community views options available to it. . Sheila Selkregg said that identifying what works should also be included. . Joe Sarcone referred to the 33 case studies in the ANTHB report. . Scott Ruby said that individual communities will never have a complete picture of what the costs are. He suggested that ISER ask communities how they plan to replace a utility system if it breaks down. . Sheila Selkregg said that she plans to talk to Commonwealth North about an executive summary of this project to date, plus work sessions with key policy makers. She said that the Steering Committee should think about how this will be done. Sheila said that she will see the executive board of Commonwealth North on Tuesday, January 16. Commonwealth North is interested in this project, including Scott Goldsmith’s work. She said that we need a timetable for completion of the project, plus a midway executive summary. . Jamie Kenworthy suggested that ISER put together a final report in the form of a PowerPoint presentation, so that the Steering Committee can agree on the various concepts. . Sheila Selkregg said that this needs to be done fairly soon. . Steve Colt said that it was not a quality versus time thing. He said that Scott Goldsmith could close out his piece of the project and then we could take stock of where we are right now. . Jamie Kenworthy said that he cared more about the Legislature than Commonwealth North. . Sheila Selkregg said that she needed a date that this could be completed. . Steve Colt said February 1.

The next meeting of the Steering Committee will be February 8 and 10:30 AM. The location will be the same unless otherwise notified.

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