MINUTES
OF THE MEETING
OF
THE
FINANCE COMMITTEE
October
22, 2010
______________________________________________________________________________
A
meeting of the Finance Committee was held via videoconference at the
The following
members of the Finance Committee were present:
Michael J. Townsend, Chairman
Trustee
Eugene Nicandri
Trustee
Jonathan F. Foster (participated via telephone conference)
Also in
attendance were:
Gil Quiniones Chief
Operating Officer
Terryl Brown Executive
Vice President and General Counsel
Elizabeth McCarthy Chief
Financial Officer
Donald Russak Senior
Vice President – Planning and Finance
Brian McElroy Treasurer
Karen Delince Corporate
Secretary
Timothy Sheehan Special
Counsel – General Counsel
Gerard Vincitore Director
– Financial Projects – Business Services
Lorna Johnson Assistant
Corporate Secretary
Sheila Baughman Senior
Secretary, Corporate Secretary’s Office
________________________________________________________________________
Chairman
Michael Townsend welcomed all Members to meeting and asked Ms. Elizabeth McCarthy,
Chief Financial Officer, to present the first item on the Agenda.
1. Issuance of the 2010 Bonds
Ms. McCarthy said that she wanted to
discuss staff’s proposal with regard to the series 2010 Revenue Bonds. Staff
intended to recommend the proposal to the Trustees for approval at their
November 26, 2010 meeting. She then
outlined the purposes of the 2010 Bonds as follows:
1.
Current refunding of certain bonds that
are callable in November 2010;
2.
Potential of advancing refunding of
certain of the Authority’s other revenue bonds; and
3. Potential
for issuing new money bonds related to the Lewiston Pumped generating plant Life
Extension and Modernization that was approved by the Trustees.
She stated that the Finance Committee’s
Charter requires the Committee to review staff’s proposals before such proposal
is recommended to the full Board of Trustees for approval. She also stated that, ultimately, the action
staff would take with regard to the size of the deal and bonds refunded would
depend on market conditions.
Ms. McCarthy then asked Mr. Brian McElroy,
Treasurer, to present staff’s proposal to the Committee.
In response to a question from Vice
Chairman Foster, Ms. McCarthy said that staff is working with various parties;
the deal should take place early December, or before.
On motion made and seconded, the Finance
Commence agreed to recommend that the Board of Trustees approve the issuance of
the 2010 bonds as outlined in the presentation to the Committee.
2. Purchase
of an Interest Rate Cap
Mr. Brian McElory presented staff’s proposal
to the Committee. He said that the
purpose of this recommendation is to protect the Authority’s liquidity risk in
the event that interest rates change, which, in turn, might affect its customer’s
ability to pay.
In response to a question from Chairman
Townsend, Mr. McElroy said that the Authority can enter into a 3-year cap at 4%
on $300 million notional amount for less item $400,000.
In response the further question from
Chairman Townsend, Mr. McElroy said that the proposal is not to exceed $400
million and is at a rate not to exceed 5.9%.
On motion made and seconded, the Finance
Committee agreed to recommend that the Board of Trustees approve the purchase
of an interest rate cap for a period not to exceed 5 years as outlined in the
presentation to the Committee.
3. Amendments
to Finance Charter
Ms. Karen Delince highlighted the
proposed amendments to the Finance Charter. She said that the Trustees had
requested that the Finance Committee Charter be amended to allow more trustees
to serve on the Committee. The existing Charter limits membership on the
Committee to three and the amendment would increase membership to “three to
five” Trustees. In response to a
question from Trustee Nicandri, Ms. Terryl Brown said that “independent”
signifies that the Trustees are not employees of the Authority. In response to further question from Trustee
Nicandri, Ms. Brown said that an employee could become a member of the Board of
Trustees; that a member of the Board of Trustee could become an employee and
that business relationships could also affect their independence.
Chairman Townsend pointed out that a Board
member being independent is a provision in the PAAA and also that at the
present time all of the Authority’s Trustees are independent.
4. Motion
to Conduct an Executive Session
Mr.
Chairman, I move that the Finance Committee conduct an Executive Session
pursuant to Section 105 of the Public Officers Law, in connection with
discussions relating to matters concerning employment. On motion made and
seconded, an executive session was held.
5. Motion
to Resume Meeting in Open Session
Mr.
Chairman, I move to resume the meeting in Open Session. On motion made and seconded, the meeting resumed in Open
Session.
6. Next Meeting
The next regular meeting of the Finance
Committee is to be determined.