HomeMy WebLinkAboutFCMeetingMinutes_05.08.12
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TOWN OF NORTH ANDOVER
FINANCE COMMITTEE
Meeting Minutes
Meeting Date:
May 8, 2012
Meeting Location: Town Hall, 2nd Meeting called to order: 7:45PM
Conference Room
Alan LeBovidge AL, Chairman Ramsey Bahrawy- RB
X
Tom Dugan TD, Vice Chairman Robert Norbedo-RN
X X
Ben Osgood-BO Matthew Remis-MRem
X x
Dan Leary -DL
x
Peter Besen-PB Pat Sifferlen, PS, Admin
X X
Donald Elliot DE
X
Non FinCom Members in Attendance
OTHERS: - Chris Alen(CA), Ray Santilli (RS), Chris Hottell (CH), Stan Limpert (SL), Andrew
Maylor (AM), Steve Weisman (SW)
Note: All FINCOM votes are subject to change upon receipt of new information.
Note: Documents used in this meeting are listed in Document Table, herein.
II. Previous Minutes Approved
AGENDA ITEM: A. Steve Weisman ESCO Discussion
AL introduces Steve Weisman to talk about the ESCO and Ameresco Contract 2
SW work with Peregrine Energy Group. 33 yrs in Energy service He is advising North
Andover on ESCO Plan. Worked with MVPC and selected Ameresco.He is paid by
town to give independent consulting
AL how does Ameresco Make Money?
SW : they go in to towns and set up potential energy saving projects. Project terms
acceptable to town. This is a design/ build project. Projects create utility savings to
pay for modernization of items. The ESCO provides all of the services required to
design and implement projects from the initial energy audit through long term
monitoring and verification of the project savings. Ameresco performed an audit of
the municipal and school buildings. The cost would be offset by the anticipated energy
savings.
There is a 40% markup above base cost.20% on materials 9% overhead and 9% profit
margin this is consistent with industry.
TD. Who is going to maintain equipment?
SW Staff would be trained. Town would receive maintenance and warranties
Ameresco has a one year warranty once town certifies work is complete you take over
They do have a 30K annual charge for maintenance paid for by the annual savings.
Town is paying more from this than they would having to do it themselves over
multiple years but you are getting 4.2 million in projects done within a year.
AM Payback savings will pay for project. They guarantee energy savings if not they
will generate a check to the town. Their goal is to not give you a check.
TD We are going to finance 4.3 million to generate 369k in savings per year over 15yrs
Net cash flow surplus over debt service is this sufficient to pay financing.
PB Certain amount of equipment has no payback
AM some of these are at end of life or preventive maintenance we will need to change
some of these anyways within the next few years.
DE some of these are steam systems. They are very expensive to maintain would it be
more effective to replace.
SW Project is for 15 yrs, town has reduced the number of projects based on the
Facilities Master plan and cost is including any rebates from national grid. Projects
create utility savings to pay for modernization of items.
There is a total of 40% markup AL how do they measure savings?
AM There goal is to not give the town a check.
AM None of these projects are in both reports many of the projects in Ameresoreport
were taken out based on the Facilities Master Plan
SW Baseline usage is established at beginning of contract. Based on usage today on
existing systems.
DL What if there was a change of use?
SW does not change contract. 25K a year fee is built into contract. Town should notify
if there is a change of use. Every building will have their own baseline. Town can make
changes to building the requirement is to notify Ameresco to adjust savings
projections.
DL pitfall is paying debt service for 15 years 1/3 of total energy budget.
SW this is a very typical project.15 yrs this project has long and short paybacks
BO what towns are doing these types of projects?
SW Dedham Swampscott. More and more towns are doing this under law MGL 25A
itis fairly new and is allowing towns to do these infrastructures all at once within a
reasonable period of time
Page 4 of handout gives breakdown of financing.
Total Project Investment $4,276,031
Utility Rebates $(275,832)
Net Project cost $4,000,199
st
Guaranteed Cost Savings (1 yr) $378,588
Cash Flow over 13 yr term $208,217
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AGENDA ITEM: D. New Business
Discussion:
III. New Business
IV. Next Meetings
May 10, 2012
V. Adjournment-
Motion: DE Unanimous
Seconded: TD Time: 9:00
DOCUMENTS PROVIDED AT MEETING
TYPE FROM TO SUBJECT COMMENTS
ITEM #
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ITEM # ACTION ITEM INDIVID. COMPL. STATUS
DATE