AGENDA - Special Council - 20040622TOWN OF AURORA
SPECIAL COUNCIL
AGENDA
BOREALIS NIIORO ELECTRIC NOlDIN6S INC.
ANNUAL SUAREN9lDENS'MEETING
NO.0421
iNESBAr,IUNEY2,Y004
5:00 px
COUNCIL CHAMBERS
PUBLIC RELEASE
18/06/04
TOWN OF AURORA
SPECIAL COUNCIL
BOREALIS HYDRO ELECTRIC HOLDING INC.
ANNUAL SHAREHOLDER'S MEETING
AGENDA
NO. 04-21
Tuesday, June 22, 2004
I DECLARATIONS OF PECUNIARY INTEREST
11 APPROVAL OF AGENDA
RECOMMENDED:
THAT the content of the Agenda as circulated by the Corporate Services
Department be approved as presented.
III RECEIPT OF MINUTES
Borealis Hydro Electric Holding Inc., Annual Shareholder's Meeting
Minutes No. 03-21, Tuesday, July 15, 2003
RECOMMENDED:
THAT the Minutes of Meeting No. 03-21 be received for information.
IV DELEGATIONS
(pg. 1)
Mr. John Sanderson, President and CEO of Aurora Hydro (pg. 4)
Connections Limited to present Council with an overview of the
significant activities undertaken by Aurora Hydro in 2003 and
current initiatives for 2004.
Special Council Agenda No. 04-21 Page 2 of 3
Tuesday, June 22, 2004
V READING OF BYLAWS
RECOMMENDED:
THAT the following listed by-law be given 1st, 2nd and 3rd
readings, and enacted:
4553-04.0 BEING A BY-LAW to (pg. 40)
Confirm Actions by Council
Resulting From The
Special Council Meeting -
Tuesday, June 22, 2004.
VI 1N CAMERA
None
V11 ADJOURNMENT
Special Council Agenda No. 04-21 Page 3 of 3
Tuesday, June 22, 2004
AGENDA ITEMS
1. Consolidated Financial Statements, December 31, 2003 (pg. 14)
RECOMMENDED:
THAT the attached Consolidated Financial Statements,
December 31, 2003, as approved by the Board of Directors,
and the accompanying Management Discussion and Analysis
be received for information.
2. Memorandum from John Sanderson, President and CEO of (pg. 36)
Aurora Hydro Connections Limited
Re: Appointment of Auditors for Borealis Hydro Electric Holdings Inc.
RECOMMENDED:
THAT Grant Thornton LLP be re -appointed as the auditors of
the Borealis Hydro Electric Holdings Inc.
3. Memorandum from John Sanderson, President and CEO of (pg. 37)
Aurora Hydro Connections Limited
Re: Appointment of Directors for Borealis Hydro Electric
Holdings Inc.
RECOMMENDED:
THAT the Shareholder accept the nominations of Mr. Calvin
White and Mr. Dan Sooley to be re -appointed to the Board of
Directors for a 3-year term.
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
TOWN OFAURORA
SPECIAL COUNCIL
BOREALIS HYDRO ELECTRIC HOLDINGS INC.
ANNUAL SHAREHOLDER'S MEETING
MINUTES
NO. 03-21
Council Chambers
Aurora Town Hall
Tuesday, July 15, 2003
ATTENDANCE
MEMBERS ABSENT
TOWN STAFF
HYDRO BOARD OF DIRECTORS
HYDRO LEGAL COUNSEL
HYDRO STAFF
Mayor Jones in the Chair; Councillors Griffith,
Kean, MacEachern, Pedersen, Timpson,
Vrancic and Wallace
Councillor West was absent
Chief Administrative Officer, Administrative Co-
ordinator/Deputy Clerk and Treasurer
Gord Lytle, Jane Murray, John Sanderson, Dan
Sooley, and Calvin White
Mark Rodger, Borden Ladner Gervais
Allister Byrne, Grant Thornton LLP
Mike Bunn, Grant Thornton LLP
David Frye, Acting Chief Financial Officer
Cooky Ellis, Secretary
Mayor Jones called the meeting to order at 4:00 p.m.
DECLARATIONS OF PECUNIARY INTEREST
There were no declarations of pecuniary interest under the Municipal Conflict of
Interest Act.
1l APPROVAL OFAGENDA
Moved by Councillor Griffith Seconded by Councillor Timpson
THAT the content of the Agenda be approved as presented.
CARRIED
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Special Council Meeting No. 03-21 Page 2 of 3
Borealis Hydro Electric Holdings Inc. Annual Shareholder's Meeting
Tuesday, July 15, 2003
III ADOPTION OF MINUTES
Borealis Hydro Electric Holding Inc. Shareholder's Meeting Minutes No. 01-
03, Monday, February 3, 2003
Moved by Councillor Griffith Seconded by Councillor Timpson
THAT the Minutes of Meeting Number 01-03 be adopted as printed and
circulated.
CARRIED
1V DELEGATIONS
None,
V CONSIDERATION OF ITEMS REQUIRING SEPARATE DISCUSSION
Items 1, 2 and 4 were Identified for separate discussion.
VI ADOPTION OF ITEMS NOT REQUIRING SEPARATE DISCUSSION
Moved by Councillor Griffith Seconded by Councillor Pedersen
THAT the following recommendations respecting the matters listed as
"Items not Requiring Separate Discussion" be adopted as submitted to
Council and Staff be authorized to take all necessary action required to
give effect to same:
3. Borealis Hydro Electric Holding Inc. Shareholder's Meeting #02.03
Aurora Hydro Strategic Action Plan
THAT the Aurora Hydro Strategic Action Plan be received for information.
5. Appointment of Auditors Borealis Hydro Electric Holding Inc.
THAT Grant Thornton LLP be re -appointed as the auditors of the Borealis
Hydro Electric Holding Inc.
6. ADM03.012 — Borealis Holdings Incorporated: Revised Shareholder Declaration
Board of Directors Appointments
THAT the Mayor and Clerk be authorized to execute a Revised and
Restated Shareholder Declaration relating to Borealis Holdings
Incorporated directing that the person holding the position of Town
Treasurer/Director of Finance be a member of the Board of Directors.
THAT Jane Murray be appointed to the Board of Directors of Borealis
Holdings Incorporated for a 3-year term;
THAT Allan Evelyn the Treasurer and Director of Finance for the Town of
Aurora be appointed to the Board of Directors of Borealis Holdings
Incorporated.
CARRIED
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Special Council Meeting No. 03-21 Page 3 of 3
Borealis Hydro Electric Holdings Inc. Annual Shareholder's Meeting
Tuesday, July 15, 2003
VI IN CAMERA
Moved by Councillor Pedersen Seconded by Councillor Griffith
THAT Council proceed In Camera to address personnel matters subject to
solicitor/client privilege.
CARRIED
Council resolved into an in camera session to address personnel matters subject to
solicitor/client privilege at 4:05 p.m.
Council resumed in public session at 5:55 p.m.
VII ITEMS REQUIRING SEPARATE DISCUSSION
2.
4.
Borealis Hydro Electric Holding Inc. Shareholder's Meeting #02-03
Year in Review and Current Initiatives Update
Mr. John Sanderson gave an update including a review of events during the
deregulation of the hydro industry and the current initiatives of Aurora Hydro
Connections.
MovedbyCouncillor MacEachern Seconded by Councillor Pedersen
THAT the Year in Review and Current Initiatives Update be received for
information.
CARRIED
Borealis Hydro Electric Holding Inc. Shareholder's Meeting #02.03
Consolidated Financial Statements, December 31, 2002
Moved by Councillor Timpson Seconded by Councillor Griffith
THAT the Consolidated Financial Statements, December 31, 2002 be
received for information.
CARRIED
VIII OTHER BUSINESS, COUNCILLORS
Mayor Jones thanked Mr. Gord Lytle, retiring Member of the Board of Directors
for Aurora Hydro Connections, for his dedication and service to Aurora Hydro
and wished him all the best in the future,
Mayor Jones congratulated Allan Evelyn, Treasurer for the Town of Aurora, for
his appointment and Jane Murray on her re -appointment to the Board of
Directors of Borealis Holdings Incorporated.
Councillor Kean enquired if the past financial statements for Aurora Hydro were
available to the public. Mr. Sanderson advised Council that they were available.
IX ADJOURNMENT
Moved by Councillor Griffith
THAT the meeting be adjourned'at 6:20 p.m.
CARRIED
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
AURORA HYDRO CONNECTIONS LIMITED
MEMO
TO: Aurora Town Council
FROM: John L. Sanderson
President and CEO
DATE: June 18, 2004
SUBJECT. Year in Review and Current Initiatives Update
At the June 22, 2004 Borealis Hydro Electric Holdings Inc. Shareholders' Annual
General meeting, the attached presentation will be made. The presentation
provides information to Town Council with respect to significant activities
undertaken by Aurora Hydro in 2003 and to review current initiatives underway in
2004. The presentation will be made for information purposes.
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04
TO: Aurora Town Council
FROM: John L. Sanderson, President and CEO
DATE: June 18, 2004
AGENDA ITEM #
age
SUBJECT. Consolidated Financial Statements, December 31, 2003
Recommendation
THAT the attached Consolidated Financial Statements, December 31, 2003, as
approved by the Board of Directors, and the accompanying Management
Discussion and Analysis be received for information.
Highlights
• Interest paid to the Town on the Promissory Note at 7.25 % per annum of
$923K (K = 1,000).
• Net earnings amounted to $414K, after interest and taxes, representing a
3.0% return on shareholder's equity.
• Interest and net earnings represent a 5.1 % return on the total investment
by the Town.
• An investment of $2,626K was made in capital assets to serve the needs
of a growing community.
Background
The attached audited financial statements are the consolidated financial
statements of Borealis Hydro Electric Holdings Inc. (the "Corporation"), the
holding company of Aurora Hydro Connections Limited ("AHCL"). AHCL is the
operating company which owns the assets and operates the electrical
distribution business of the former Aurora Hydro Electric Commission. The
financial results of AHCL for the fiscal year ended December 31, 2003, are
included in these consolidated statements. Any reference to the Corporation
should be taken as also referring to AHCL.
Several factors have had a significant effect on the financial results in 2003:
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04 Page 2
• In 2003 saw a full year of the requirements of Bill 210 which was
introduced late in 2002, and capped the price of electricity at the fixed rate
of $0.043 per kWh for residential, low volume and designated customers
(Municipalities, Universities, Schools, Hospitals and other non-profit
organizations).
• A decrease in the actual quantity of electricity consumed in 2003
compared to 2002. This was due to both more extreme summer and
winter temperatures in 2002 compared to 2003. There was also a minor
effect from the August 2003 blackout and subsequent conservation
efforts.
• Continued growth in the number of customers.
The capping of wholesale market services charges by the IMO under bill 210
slowed the growth of the retail variance accounts component of the regulatory
assets and helped improve the cash position.
Bill 4 was introduced late in 2003. This raises the fixed rate for electricity to
$0.047 per kWh on the first 750 kWh per month and $0.055 per kWh for the
balance, starting April 1, 2004. As well it allows for a distribution rate increase as
of April 1, 2004 to allow partial recovery of regulatory assets over four years.
Under Bill 4, the next distribution rate increase for the third and final step to the
market based rate of return is scheduled to occur in 2005 but this increase will
have to be spent on demand side initiatives in the first year.
Below are our comments regarding significant changes in 2003 financial
amounts compared to 2002.
Consolidated Statements of Earnings and Retained Earnings (Page 2)
• Revenue decreased $3,408K (K = 1,000).
• Cost of power decreased $4,110K.
In 2003, the effects of Bill 210 resulted in lower overall revenues since
electricity revenue was recorded at the fixed rate of $0.043 for residential
and other low volume and designated customers. Average spot market
price of electricity was similar in both years, approximately $0.058 per
kWh.
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04 Page 3
Similarly the cost of power was much lower since the cost of the power
sold at the fixed rate of $0.043 per kWh was reduced to the same rate on
the purchase side by the IMO.
The drop in revenue and cost of power was further intensified by an actual
decrease in electrical usage in 2003 compared to 2002.
• Gross Margin increased $702K or 13.5%.
This is AHCL's actual revenue, representing what it is permitted to collect
for providing the services related to the distribution of electricity in its
service area. Amounts charged for electricity, wholesale market services
and transmission are a pass through at cost since market opening, May 1,
2002, as per the Electricity Act of 1998.
The last distribution rate change was May 1, 2002, coincidental with
Market Opening, and incorporated the second of three steps to the market
based rate of return.
The increase in Gross margin was attributable mainly to having the new
rates for 12 months in 2003 versus 8 months in 2002.
Growth in the number of customers also contributed to this increase.
• Operations and maintenance expense increased by $76K (9%).
Approximately $36K of this increase was due to wage increases and
increased costs from suppliers. The balance of $40K was due to higher
than expected unplanned repairs and maintenance.
• Administration expense increased $293K (23.2%).
Wages and cost increases from suppliers account for approximately
$83K. The remaining increase of $21 OK was due mainly to:
Staffing changes accounted for approximately $175K of the increase.
o Staff termination and associated costs.
o Director of Engineering and Operations position was created and filled
mid -year, in response to growth and increasing regulatory demands.
Building repairs and maintenance increased $31 K over 2002 due to both
higher planned maintenance and higher unplanned maintenance and
repairs.
—16—
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04 Page 4
Insurance costs increased $11 K or 30% over the prior year.
Billing and collection increased by $60K or 8.0%.
Wages and cost increases from suppliers accounted for approximately
$23K. The remaining increase of $37K was due mainly to:
o Additional temporary staff to deal with regulatory demands and
increased number of customers.
o There were 12 months of monthly meter reading and billing in 2003
compared to 8 months for residential accounts, resulting in increased
meter reading, postage and related costs. The change from 60 day to
a monthly billing cycle for all customers was introduced in May 2002.
Previously only commercial accounts were billed monthly.
Earnings before interest and income taxes increased by $252K or 21 %.
This is the net effect of the distribution revenue increase and costs
increases discussed above.
• Interest costs decreased $231 K
This was due to the fact there were 12 months of interest on the
Promissory Note in 2003 compared to 15 months of interest in 2002 which
included interest for October 1, 2001 to December 31, 2001.
Income taxes increased $5K
There was only a slight increase in capital taxes based in growth in the
Corporation's assets. The increase in income was sheltered from
Payments in Lieu of Income Taxes by tax losses carried forward from
2001.
Net earnings increased $478K.
This was the net result of the changes in revenue and expenses
discussed above.
Retained Earnings increased $414K or 30.8%
Increase was due to increase in net earnings discussed above.
—17—
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04 Page 5
This represented a 3% return on Shareholder's equity at the start of the
year.
Consolidated Balance Sheet (Page 3)
• Cash and cash equivalents increased $1,783K
A number of factors contributed to improved cash position
o Issues surrounding billing as a result of Bill 210 were resolved in 2003
allowing billing and collections to return to normal.
o Bill 210 capped wholesale market services charges from the IMO
slowing the growth of the retail variance accounts.
o Increases in customer deposits.
The level of cash and equivalents barely met banking covenant
requirements.
Working capital levels were below that allowed by the Ontario Energy
Board.
• Accounts Receivable decreased $3,549K
• Unbilled revenue increased $1,400K
Receivables were much higher in 2002 and unbilled lower due to the
accrual of the Bill 210 phase 2 refunds for the reduction to $0.043 per
kWh for residential, low volume and designated customers for May 1 to
November 30, 2002.
After adjusting for the Bill 210 refunds in 2002, the decrease in
receivables can be attributed to the lower price of electricity at the end of
2003 compared to 2002. Average price for December 2003 was $0.048
per kWh compared to $0.060 per kWh for December 2002.
After adjusting for the Bill 210 refunds in 2002, there is a decrease in
unbilled revenues which were unusually high at December 31, 2002 due
to delays in billing related to the billing software and Bill 210. At December
31, 2003 billing is up to date. Lower prices also contributed to the
decrease.
• Capital assets increased $1,002K or 4.9%
Net addition to capital assets consisted of $2,626K in additions (net of
capital contributions by customers for new development) less depreciation
of $1,624K.
010
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04
Regulatory assets increased $898K or 40.9% (Note 5, Page 9)
Regulatory assets are made up of:
Retail services variance
Market ready costs
Retail service.
between what
and transmissl
for these costs
o variances
AHCL paid
Dn services
$2,601 K 84.1 %
$ 491K 15.9%
accounts are made up of
for power, wholesale market
and what AHCL was able to
Page 6
the differences
services (WMS)
bill to customers
Under the Electricity Act of 1998, these costs are intended to be passed
through to customers.
Retail services variances grew rapidly in 2002 by $1,740K from May 1,
2002 to December 31, 2002, an average rate of approximately $218K per
month. The most significant variances were for power and wholesale
market charges. In the summer of 2002, imported power charges were
billed by the IMO under WMS causing a difference of $750K more
charged than AHCL was allowed to bill to customers.
Retail services variances grew in 2063 by $861 K, an average rate of $72K
per month. This slowing of the growth in the variance accounts is
attributable to a capping of wholesale market charges from the IMO under
Bill 210 effective from December 1, 2002.
Market ready costs are made up of the costs involved in revamping
systems to meet the new regulatory and billing requirements.
• Payables and accruals decreased $468K or 10.5%.
The decrease is attributable mainly to the lower cost of electricity payable
at December 31, 2003 compared to December 31, 2002.
Current portion due to developers increased $348K
Due to developers increased $283K
This reflects AHCL's share of the cost of developer installed distribution
assets using an economic evaluation that compares the net present value
of costs and revenues generated by the development in accordance with
the Distribution System Code.
Customer deposits increased $209K or 31 %
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Shareholder Meeting # 01-04 Page 7
Security deposits taken on new electrical accounts have contributed to the
improved cash position.
Unearned capital contributions increased $604K or 221 %.
This increase is due to the high level of development activity and the
number of projects in progress.
• Shareholder's equity increased $414K or 3%.
AHCL's rate of return has increased significantly over 2002 to 3% but is
still below the allowed 6.5% return (213`ds of the regulated market based
rate of return of 9.8%).
This is due in part to a decision by the former Aurora Hydro Electric
Commission to decrease rates due to excess working capital in the years
leading up to the new market regulations.
Consolidated Statement of Cash Flows (Page 4)
Cash Increased $1,783K
The net change in non -cash working capital of $1,824K was the main
factor in the improved cash position.
o The decrease in receivables accounted for most of this.
o Issues with. billing and refunds around the implementation of Bill 210 at
the end of 2002 had an adverse effect on receivables and cash. This
situation has returned to normal in 2003.
Customer deposits and unearned capital contributions combined
accounted for an increase in cash of $813K.
Contributions to cash were offset by a net addition to fixed assets of
$1,002 funded in part by $631K paid for by developers yet to be re-
imbursed.
Increases in regulatory assets of $898K continued to have a negative
affect on the cash position.
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-- SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Consolidated Financial Statements
December 31, 2003
Grant Thornton V
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__SP-ECIAL--COU-UCIL- JUNE 22 2004 5:00 PM
Contents
Auditors' Report
Consolidated Statements of Earnings and Retained Earnings
Consolidated Balance Sheet
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Grant Thornton
Paae
5-13
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Grant Thornton P
Grant Thornton LLP
Chartered Accountants
Management Consultants
Auditors' Report
To the Shareholder of
Borealis Hydro Electric Holdings Inc.
We have audited the consolidated balance sheet of Borealis Hydro Electric Holdings Inc. as at
December 31, 2003 and the consolidated statements of earnings and retained earnings and cash
flows for the year then ended. These consolidated financial statements are the responsibility of the
Corporation's management. Our responsibility is to express an opinion on these consolidated financial
statements based on our audit.
We conducted our audit in accordance with Canadian generally accepted auditing standards. Those
standards require that we plan and perform an audit to obtain reasonable assurance whether the
consolidated financial statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the consolidated financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
In our opinion, these consolidated financial statements present fairly, in all material respects, the
financial position of the Corporation as at December 31, 2003 and the results of its operations and
cash flows for year then ended in accordance with Canadian generally accepted accounting principles.
Markham, Canada
April 9, 2004
1s Allstate Parkway
Suite 200
Markham, Ontario
L3R 5B4
T (416) 366-0100
F (906)475-8906
E Markham@GrmtThornton.ca
W www.GrantThomton.ca
Canadian Member of Grant Thornton Intematlonal
Grant Thornton LLP
Chartered Accountants
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SPECIALCOUNCILJUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Consolidated Statements of Earnings and Retained Earnings
Year Ended December31 2003 2002
Revenue
Distribution and sale of power prior to Open Access
$
$ 11,090,117
Sale of power after Open Access
27,394,444
21,345,076
Distribution
5,899,605
4,266,958
33,294,049
36,702,151
Cost of power
Power purchased prior to Open Access
10,159,458
Power purchased after Open Access
27,394,444
21,345,076
27,394,444
31,504,534
Gross margin
5,899,605
5,197,617
Other revenue
336,870
357,202
Expenses
Operations and maintenance
872,707
797,195
Administration
1,556,648
1,263,865
Depreciation
1,545,571
1,544,585
Billing and collecting
813,970
753,887
4,788,896
4,359 532
Earnings before interest and income taxes
1,447,579
1,195,287
Interest on long term debt
923,360
1,154,200
Earnings (loss) before income taxes
524,219
(41,087)
Income taxes (Note 13)
110,000
105,000
Net earnings (loss)
$ 414,219
$ (63,913
Retained earnings, beginning of year
Net earnings (loss)
Retained earnings, end of year
$ 1,343,077 $ 1,406,990
414,219 (63,913
$ 1,757,296 $ 1,343,077
See accompanying notes to the consolidated financial statements.
Grant Thornton
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Consolidated Balance Sheet
December31 2003 2002
Assets
Current
Cash and cash equivalents
$ 2,177,519
$ 394,028
Receivables
2,913,893
6,463,354
Unbilled revenue
2,942,467
1,542,565
Inventory
501,230
688,719
Prepaids
196,650
152,147
8,731,759
9,240,813
Capital assets (Note 4)
21,427,373
20,425,603
Regulatory assets (Note 5)
3,092,460
2,194,486
Investment
9.240
9,720
$ 33,260,832
$ 31,870,522
Liabilities
Current
Payables and accruals
$ 3,992,026
$ 4,460,315
Current portion due to developers (Note 6)
348,000
,
4,340,026
4,460,315
Customer deposits
881,774
672,876
Unearned capital contributions
876,830
272,654
Due to developers (Note 6)
283,306
-
Long term debt (Note 7)
12,736,000
12,736,000
19,11I T 936 18,141, 845
Shareholder's Equity
Share capital (Note 8) 12,385,600 12,385,600
Retained earnings 1,757,296 1,343,077
14,142,896 13,728,677
$ 33,260,832 $ 31,870,522
Commitment and Contingent liabilities (Note 14 and 15)
See accompanying notes to the consolidated financial statements.
Grant Thornton;?
9
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Consolidated Statement of Cash Flows
Year Ended December 31
2003
2002
Cash derived from (applied to)
Operating
Net earnings (loss) $
414,219
$ (63,913)
Items not affecting cash:
Depreciation
1,624,366
1,544,585
Amortization of investment
480
480
2,039,065
1,481,152
Net change In non -cash working capital
balances (Note 9)
1,824,256
(1,535,343)
3,863,321
(54,191)
Financing
Increase (decrease) in unearned capital contributions
604,176
(362,238)
Increase in amount due to developers
631,306
-
Increase in long term debt
-
12,736,000
Increase in customer deposits
208,898
55,871
Decrease in share capital
W
(12,736.00
1,444,380 (306.367)
Investing
Net additions to capital assets (2,626,236) (803,191)
Net additions to regulatory assets (897,974) (2,142,855)
(3,524,210) (2,946,046)
Net increase (decrease) in cash and cash equivalents 1,783,491 (3,306,604)
Cash and cash equivalents, beginning of year 394,028 3,700,632
Cash and cash equivalents, end of year $ 2,177,519 $ 394,028
See accompanying notes to the consolidated financial statements.
Grant Thornton
4
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31.2003
Nature of operations
Borealis Hydro Electric Holdings Inc. (the Corporation) distributes electricity to the residents and
businesses in the Town of Aurora under license issued by the Ontario Energy Board (OEB).
The Corporation is wholly owned by the Town of Aurora. The Electricity Act, 1998 provides for a
competitive marketplace in the sale of electricity. Ontario's wholesale and retail electricity
markets became open to competition May 1, 2002 (Open Access). The Ontario Energy Board
Act, 1998 (Ontario) (OEBA) conferred on the Ontario Energy Board (OEB) increased powers
and responsibilities to regulate the electricity industry. These powers and responsibilities include
the power to approve or fix rates for the transmission and distribution of electricity, the power to
provide continued rate protection for rural and remote electricity consumers, and the
responsibility for ensuring that distribution companies fulfil obligations to connect and service
customers. The OEB may also prescribe license requirements and conditions to electricity
distributors, which may include among other things, specified accounting records, regulatory
accounting principles, separation of accounts for distinct businesses and filing and process
requirements for rate setting purposes.
2. Summary of significant accounting policies
Cash and cash equivalents
Cash and cash equivalents include cash on hand, bank balances, money market funds and
guaranteed investment certificates.
Inventory
Inventory consists of repair parts, supplies and materials for maintenance and future capital
expansion and are valued at the lower of cost (determined on a first -in, first out basis) and net
realizable value.
Rate -setting
The electricity distribution business is subject to rate regulation by the OEB. The OEB has the
general power to include or exclude costs, revenues, losses or gains in the rates of a specific
period, resulting in a change in the timing of accounting recognition from that which would have
applied in an unregulated company. This change in timing gives rise to the recognition'of
regulatory assets. These regulatory assets reflect the fact that revenue and expenses are
recognized in the financial statements in different periods consistent with their inclusion in rates,
as directed by the regulator, than would be the case for an enterprise that is unregulated.
Specific regulatory assets recognized at December 31, 2003 are disclosed in Note 5.
Grant Thornton IS 5
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
2. Summary of significant accounting policies (continued)
In a letter dated December 19, 2003, the Minister of Energy granted approval for distributors to
make application to the OEB with regard to rate recovery of certain distribution regulatory assets
whose Inclusion in rates was delayed by the Electricity Pricing, Conservation and Supply Act,
2002 (Electricity Pricing, Conservation and Supply Act). As a result of the Corporation's
distribution rate application dated January 23, 2004, these distribution regulatory assets are
expected to be recovered in distribution rates over four years, commencing April 1, 2004.
However, the amount to be recovered will be subject to a yet to be determined OEB review and
approval process, expected to occur later in 2004.
The Corporation continually assesses the likelihood of recovery of each of its regulatory assets
and believes that it is probable that its regulatory assets and liability will be factored Into the
setting of future rates. If future recovery through rates is no longer considered probable, the
appropriate carrying amount will be written off in the period that the assessment is made.
The following regulatory treatments have resulted in accounting treatments differing from
Canadian GAAP for enterprises operating in a non -regulated environment:
• Market ready costs have been deferred in accordance with the criteria set out in the
OEB Electricity Distribution Rate Handbook, the Accounting Procedures Handbook
and in subsequent OEB guidelines. In the absence of such regulation, these costs
would have been expensed when incurred under Canadian GAAP;
• The Corporation has deferred certain retail settlement variance amounts under the
provisions of Article 490 in the OEB Accounting Procedures Handbook;
Revenue recognition
Prior to Open Access, revenues attributable to the sale and delivery of electricity were based on
OEB approved bundled rates. Since Open Access, revenues are based on OEB approved
unbundled rates and are recognized as power is delivered to customers. The Corporation
estimates the monthly revenue for the period based on customer's usage because customer
meters are not generally read at the end of each month. Unbilled revenue is recognized for
customer usage not billed at December 31, 2003.
Depreciation
Capital assets are depreciated by the straight-line method over periods approximating their
estimated useful lives as follows:
Distribution system 17 - 37 years
Other capital assets 5 -15 years
When capital assets are sold or scrapped, the cost of the asset and the related accumulated
depreciation is removed from the accounts with the resulting net gain or loss being included in
operations for the year.
Grant Thornton
OHM
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
2... Summary of significant accounting policies (continued)
Contributions for capital construction
Capital contributions are required contributions received from outside sources used to finance
additions to capital assets. Earned contributions are treated as a "credit contra account'
included in the determination of capital assets. The amount is subsequently depreciated by a
charge to accumulated depreciation and a credit to depreciation expense, at an equivalent rate
to that used for the depreciation of the related capital asset.
Corporate income and capital taxes
Under the Electricity Act, 1998, the Corporation Is required to make payments in lieu of
corporate income taxes to the Ontario Electricity Financial Corporation. These payments are
calculated In accordance with the rules for computing income and taxable capital and other
relevant amounts contained in the Income Tax Act (Canada) and the Corporation Tax Act
(Ontario) as modified by the Electricity Act, 1998 and related regulations.
The Corporation provides for payments in lieu of corporate income taxes relating to its regulated
business using the taxes payable method as directed by the OEB. Under the taxes payable
method, no provisions are made for future income taxes as a result of temporary differences
between the tax basis of assets and liabilities and their carrying amounts for accounting
purposes. When unrecorded future income taxes become payable, it is expected that they will
be included in the rates approved by the OEB and recovered from the customers of the
company at that time. This regulation accounting treatment differs from Canadian generally
accepted accounting principles for enterprises operating in a non -regulated environment.
Pension plan
The Corporation provides a pension plan for its employees through the Ontario Municipal
Employees Retirement System ("OMERS"). OMERS is a multi -employer pension plan which
operates as the Ontario Municipal Employees Retirement Fund (the "Fund") and provides
pensions for employees of Ontario municipalities, local boards, public utilities and school boards.
The Fund is a contributory defined benefit pension plan financed by equal contributions from
participating employers and their employees and by the investment earnings of the Fund (Note
10).
Other post -employment benefit plans
Employee future benefits provided by the Corporation include life insurance benefits and
voluntary exit incentive program liability. These plans provide benefits to certain employees
when they are no longer providing active service. Employee future benefit expense Is
recognized in the period in which the employees render the services.
Grant Thornton E4 7
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
2. Summary of significant accounting policies (continued)
Employee future benefits are recorded on an accrual basis. The accrued benefit obligations and
current service cost are calculated using the projected benefits method pro rated on service and
based on assumptions that reflect management's best estimate. The current service cost for a
period is equal to the actuarial present value of benefits attributed to employees' services
rendered in the period. Past service costs from plan amendments are amortized on a straight-
line basis over the average remaining service period of employees active at the date of
amendment. Actuarial gains (losses) are amortized into expense on a straight-line basis over
the average remaining service period of active employees to full eligibility.
Capital assets retirement obligations
Canadian generally accepted accounting principles require the Corporation to determine the fair
value of the future expenditures required to settle legal obligations to remove capital assets on
retirement. If reasonably estimable, a liability is recognized equal to the present value of the
estimated future removal expenditures. An equivalent amount Is capitalized as an inherent cost
of the associated capital assets.
Some of the Corporation's assets may have asset retirement obligations. As the Corporation
expects to use the majority of its capital assets for an indefinite period, no removal date can be
determined and, consequently, a reasonable estimate of the fair value of any asset retirement
obligations has not been made at this time.
Use of estimates
In preparing the Corporation's consolidated financial statements, management is required to
make estimates and assumptions that affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities at the date of the Consolidated Financial
Statements and reported amounts of revenue and expenditures during the year. Due to the
inherent uncertainty in making estimates, actual results could differ from these estimates.
3. Related party transactions 2003 2002
The Corporation had the following transactions with the Town of Aurora, the shareholder of the
Corporation:
Interest paid $ 923,360 $ 1,154,200
Rent 97,120 96,396
Energy sales and services 675,159 812,647
Grant Thornton T,
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SPECIAL COUNCIL JUNE 22 2004 5.00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
4. Capital assets 2003 2002
Accumulated Net Net
Cost Depreciation Book Value Book Value
Distribution system
$ 40,493,408 $ 19,396,781 $ 21,096,627
$ 19,848,833
Other capital assets
2,725,314 2,394 568 330,746
576.670
$ 43,218,722 $ 21.791,349 $ 21,427,373
$ 20,425,503
5. Regulatory assets
2003
2002
As described in Note 2, the Corporation
has recorded the following regulatory assets:
Retail services variance
$ 2,600,786
$ 1,740,005
Market ready costs
491,674
454,481
$ 3,092,460 $ 2,194,486
6. Due to developers
For all agreements entered into on or after November 1, 2000, that require the construction of
new facilities to the distribution system or increased capacity of existing distribution system
facilities to connect new customers, the Distribution System Code requires the Corporation to
perform an economic evaluation to determine if the future revenue will pay for the capital cost
and on -going maintenance costs of the expansion project. If there Is a shortfall between the
present value of the projected costs and revenues then a capital contribution may be requested.
The amount shown as 'Due to Developers' represents the difference between the developers'
required capital contribution as determined by the economic evaluation and the cost of
distribution assets installed and paid for by the developers.
7. Long term debt
The unsecured promissory note is payable to the Town of Aurora in the amount of $12,736,000
effective November 1, 2000. The note bears interest at a simple annual rate equal to the rate of
interest that the Corporation is, from time to time, permitted by the OEB to recover in its rates
(currently 7.25% per annum). Interest is due and payable quarterly on the last day of March,
June, September and December.
Grant Thornton .4,
E
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
8. Share capital 2003 2002
Authorized:
The Corporation is authorized to issue an unlimited number of common shares.
Issued:
1,000 shares $ 12,385,000 $ 12,385,600
9. Supplemental cash flaw information 2003 2002
Net change in non -cash working capital balances
Receivables $ 3,549,461 $ (3,648,656)
Unbilled revenue (1,399,902) 431,692
Inventory 187,489 564,707
Prepaids (44,503) 35,299
Payables and accruals ' (468.289) 1,081,615
$ 1,824,256 $ (1,535,343)
Interest income $ 74,225 $
Interest paid $ 923,360 $ 923,360
10. Pension agreements
The Corporation makes contributions to the Ontario Municipal Employees Retirement Fund
(OMERS), which Is a multi -employer plan, on behalf of members of its staff. The plan is a
defined benefit plan, which specifies the amount of the retirement benefit to be received by the
employees based on the length of service and rates of pay.
Effective August 1, 1998 OMERS provided a temporary contribution holiday, with no employer or
employee pension contributions required until January 1, 2003.
Commencing January 1, 2003, contributions were made at rates ranging from 2.1%to 2.93%
depending on the proposed retirement age and the level of earnings. As a result $28,560 (2002
- $Nil) was contributed to OMERS for current service. Effective January 1, 2004 full
contributions rates are proposed to resume, ranging from 6% to 9.8% depending on the
proposed retirement age and the level of earnings.
Grant Thornton 2
10
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
11. Other post -employment benefit plans
The Corporation pays certain benefits on behalf of its retired employees.
The Corporation's defined benefit plan for the year ended December 31 is as follows:
2003 2002
Accrued benefit obligation, beginning of year $ 123,906 $ 121,265
Benefits paid (6,535) (6,481)
Expense for the year 10,034 9,122
Accrued benefit obligation, end of year $ 127,405 $ 123,906
The significant actuarial assumptions adopted in measuring the accrued benefit obligation are
as follows:
Discount rate
The accrued benefit obligation for the year ended December 31, 2003 was determined using an
annual discount rate of 6.0%. This corresponds to the assumed Consumer Price Index ("CPI")
rate plus an assumed real rate of return of 2.5%.
Salary and wage levels
Future general salary and wage levels were assumed to increase at 2% per annum.
General inflation rates
Future general inflation rates, as measured by changes in the CPI, were assumed at 3.5% in
2001 and thereafter.
12. Public liability insurance
The Corporation is a member of the Municipal Electric Association Reciprocal Insurance
Exchange (MEARIE), which was created on January 1, 1987, A reciprocal insurance exchange
may be defined as a group of persons formed for the purpose of exchanging reciprocal
contracts of indemnity or inter -insurance with each other through the same attorney. MEARIE
has provided general liability insurance to the Corporation of $20,000,000 per occurrence.
Grant Thornton,,,
11
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
13. Income taxes
The Corporation is required to compute and remit to the Ontario Electricity Financial Corporation
owned by the Province of Ontario payments in lieu of income taxes (PILS). PILS are computed
in accordance with rules for computing income, capital and other taxes provided for in the
Income Tax Act (Canada) and the Corporation Tax Act (Ontario) as modified by The Electricity
Act, 1998 and related regulations.
Income before provision for PILS
Federal and Ontario statutory income tax rates
Provision for PILS at statutory rate
Depreciation in excess of capital cost allowance
Deduction of Ontario capital tax
Permanent differences:
Ontario capital tax
Large corporation tax
Loss carry forward
Provision for PILS.
2003
2002
$ 524,219
$ 42,087
36.6%
38.6%
191,864
41,335
103,380
58,132
(39,280)
(25,090)
70,000
65,000
40,000
40,000
(255,964)
(74.377)
$ 110,000 $ 105,000
Future income taxes relating to the regulated businesses have not been recorded in the
accounts as they are expected to be recovered through future revenues.
14. Commitment
Purchasers of electricity in Ontario, through the IMO, are required to provide security to mitigate
the risk of their default based on their expected activity in the market. The IMO could draw on
these guarantees if the Corporation fails to make a payment required by default notice issued by
the IMO. The maximum potential payment is the face value of the bank letters of credit. As at
December 31, 2003, the Corporation provided prudential support using bank letters of credit of $
2,591,187.
15. Contingent liabilities
A class action claiming $500 million in restitution payments plus interest was served on Toronto
Hydro Electric Commission on November 18, 1998. The action was initiated against Toronto
Hydro as the representative of the Defendant Class consisting of all municipal electrical utilities
in Ontario that have charged late payment charges on overdue utility bills at any time after April
1. 1981.
Grant Thornton &
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
Notes to the Consolidated Financial Statements
December 31, 2003
15. Contingent liabilities (continued)
The claim is that the late payment penalties resulting In the municipal electrical utilities receiving
Interest at effective interest rates in excess of 60% per year, which is illegal under section
347(1)(b) of the Criminal Code.
The Electricity Distributors Association is undertaking the defence of this class action. At this
time it is not passible to quantify the effect, if any, on the financial statements of the Corporation,
and as such no accrual of any potential liability has been recognized.
The Corporation is defending a wrongful dismissal claim. The likely outcome of this matter
remains uncertain at this time.
16. Comparative figures
Certain of the 2002 comparative figures have been reclassified to conform to the financial
statement presentation adopted for the current year.
Grant Thornton
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
BOREALIS HYDRO ELECTRIC HOLDINGS Inc. AGENDA ITEM #
Shareholder Meeting # 01-04
TO: Aurora Town Council
FROM: John L. Sanderson P.Eng.
President and CEO
DATE: June 18, 2004
SUBJECT. Appointment of Auditors
Recommendation
THAT Grant Thornton LLP be re -appointed as the auditors of the Borealis Hydro
Electric Holdings Inc.
Comments
Grant Thornton LLP are the auditors for Borealis Hydro Electric Holdings Inc.
This is the second year they have worked for us and we have found no cause not
to renew their contract for the 2004 fiscal year. Therefore, it is the
recommendation of the Board of Borealis Hydro Electric Holdings Inc. that Grant
Thornton LLP be reappointed as our auditors.
—36—
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
BOREALIS HYDRO ELECTRIC HOLDINGS Inc. AGENDA=ITEM # 3
Shareholder Meeting # 01-04
TO: Aurora Town Council
FROM: John L. Sanderson P.Eng.
President and CEO
DATE: June 18, 2004
SUBJECT. Appointment of Directors
Recommendation
THAT the Shareholder accept the nominations of Mr. Calvin White and Mr. Dan
Sooley to be reappointed to the Board of Directors for a 3-year term.
Comments
Attached is the Board Nominating Committee's recommendation for information.
—37—
SPECIAL COUNCIL JUNE 22 2004 5:00 PM
Borealis Hydro Electric Holdings Inc.
REPORT OF THE NOMINATING COMMITTEE
June 4"', 2004
To: Board of Directors
From: The Nominating Committee
Tim Jones, Jane Murray, John Sanderson
Re: Board Member Terms of Office
Recommendation
THAT Cal White and Dan Sooley, having served two (2) years on the initial term of the
Borealis Hydro Electric Holdings Inc. Board of Directors be re -appointed to their first full term,
three (3) years.
Comments
As outlined in the Shareholder Declaration,
7 Public Meetings and Annual Resolution
Within 6 months after the end of each fiscal year of the Corporation:
7.1 Annual and Special Reports to Meetings of Council — the Board shall report to an in
camera meeting, of Council, as permitted bylaw, and the Chair or the President and
CEO shall attend such meeting and provide such information concerning the
Corporation and Subsidiaries as is appropriate pursuant to the Shareholder Declaration.
7.2 Annual Resolutions: -
a) The Shareholder shall, at an in camera meeting of Council, as permitted by law,
consider candidates for the Board as proposed by the Nominating Committee and the
appointment of the auditors of the Corporation and receive the audited financial
statements of the Corporation for the last completed fiscal year, and
b) The Shareholder, in a Council meeting open to the public, by resolution shall appoint
the necessary members of the Board and appoint the auditors for the Corporation
and complete such other business as would normally be completed at an annual
meeting of Shareholders under the OBCA provided that, where such other business
requires the consideration of sensitive or confidential information, the Council may
proceed in camera, as permitted by law and in the discretion of Council, and provide
direction which shall be communicated in writing to the Corporations Board and
signed by the Shareholder Representative as provided for by Subsection 6.1 hereof.
The 2004 Annual General Meeting has been scheduled for Tuesday, June 22"d, 2004 at 6:00pm.
For the information of Council, and as taken from the Shareholders Declaration:
4.8 Role of the Nominating Committee — After the initial Board is appointed, the Shareholder
shall consider candidates nominated by the nominating committee of the Board (the
"Nominating Committee'), but shall not be obliged to select such candidates. it is
expected that the Nominating Committee will develop a process to identify and evaluate
potential Board candidates in order to recommend a slate of qualified candidates to the
Im
SPECIAL COUNCIL JUTE 22 2004 5:00 PM
Shareholder. The directors of the subsidiaries shall be chosen by the Board from the list
or proposed candidates identified by the Nominating Committee.
4.6. The term for each member of the Board shall be as follows:
it) The Town Councillor or Mayor shall serve as a member of the Board as long as such
person remains in office during the municipal term of each Council up to three years.
Re-election of a Town Councillor or the Mayor will not automatically result in re-
appointment to the Board.
b) The first five (5) Private Directors of the initial Board shall be appointed by the
Shareholder as follows: two (2) Private Directors for a one (1) year term, two (2)
Private Director for a 2 (2) year term, and one (1) Private Director far a three (3) year
term. Following the appointment of the initial Board, the Shareholder shall appoint
Directors to the Board to fill vacancies as required. With the exception of the Initial
Board of Directors, all Directors of the Corporation appointed to fill vacancies of the
Board shall serve 3 year terms.
c) Any member of the Board may serve up to two (2) consecutive terms, excluding the initial
term, as determined by the Shareholder. There is no limit on the total number of terms of
any member of the Board as determined by the Shareholder beyond the two (2)
consecutive term limitation described herein.
As members of Council will recall, at the 2003 Annual General Meeting, the Board had 2
positions up for consideration after 1 year of service with the initial Board. Jane Murray, who
had served the Board for a one (1) year term was reappointed for a 3 year term as not to lose the
experience gained in her first year of service to the Board. The Town Treasurer was appointed to
the second position, the incumbent declaring that it was not their wish to continue.
The Board, for the 2004 AGM, finds itself in a position of considering two (2) positions whose
I" term has expired after two years of service with the initial Board. Cal White and Dan Seeley
are the two (2) Directors whose initial terms are expiring. Both members have expressed a desire
to serve a second term at the pleasure of the Shareholder and qualify under the conditions as set
by the Shareholders declaration.
The Board is currently comprised of the Mayor as the Shareholders Representative, the President
and CEO of Aurora Hydro and five private members, three of whom are in the "initial term" of
the Board, George Steeves, Chairman, Dan Seeley, Cal White, and two of whom are considered
in their first full term Jane Murray (reappointed for a 3 year term after her initial 1 year term) and
the Town Treasurer, (appointed to replace Gerd Lydle who served in the initial term but decided
not to continue). The Board is also supported by the Director of Operations and Chief Financial
Officer of Aurora Hydro.
With consideration to the short history of this initial Board, with no member having served more
than 2 years, and with consideration to the current review underway to examine the merits of a
merger with Newmarket, the Nominating Committee respectfully recommends that, as allowed
for in the Shareholders Declaration, Cal White and Dan Seeley be reappointed as to take
advantage of the learning and Board experience they have gained in their two year initial term
appointment to the current challenges facing Aurora Hydro, which include the implementation of
the company business plan and the merger review currently underway. As it is, the Board will be
acquiring the benefit of a new member through the Town Treasurer's position
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SPECIAL COUNCIL JUNE 22 2004 5:00 PM
THE CORPORATION OF THE TOWN OF AURORA
By-law Number 4553-04.0
BEING A BY-LAW to
Confirm Actions by
Council Resulting From
The Special Council
Meeting of June 22, 2004.
THE COUNCIL OF THE CORPORATION OF THE TOWN OF AURORA
HEREBY ENACTS AS FOLLOWS:
THAT the action of the Council at its special meeting held on June 22, 2004 in
respect to each motion, resolution and other action passed and taken by the
Council at the said meeting is, except where prior approval of the Ontario
Municipal Board is required, hereby adopted ratified and confirmed.
2. THAT the Mayor and the proper officers of the Town are hereby authorized and
directed to do all things necessary to give effect to the said action or to obtain
approvals where required and to execute all documents as may be necessary in
that behalf and the Clerk is hereby authorized and directed to affix the corporate
seal to all such documents.
READ A FIRST AND SECOND TIME THIS 22"d DAY OF JUNE, 2004.
READ A THIRD TIME AND FINALLY PASSED THIS 22n° DAY OF JUNE, 2004.
JONES, MAYOR B. PANIZZA, TOWN CLERK
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