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June 16, 2009

Mr. Myron Lawson, President


Alexandria City Council
P.O. Box 71
Alexandria, Louisiana 71309

RE: Litigation Report / CLECO


Analysis of Proposed Alexandria PSA vs. St Martinville PSA

Dear Mr. Lawson,

Find enclosed the report you requested concerning the St. Martinville
power supply agreement. This document is being released publicly despite it being
generated in the context of the present litigation. To promote transparency and in
the spirit of open debate and disclosure it is now a public record. This course will
allow the public to view the allegations made by Mr. Lacour for what they are, and
to make its own judgment.

We will no longer continue to waste taxpayer resources on Mr. Lacour's


claims. He appears to have mixed motives since he is seeking a contract with the
City. Furthermore, he has not been correct about any of his analytical assertions.

Sincerely,

CEJjr/eg

cc: Jacques M. Roy, Mayor


David Crutchfield, Finance Director
All City Councilmen Charles E. Johnson, Jr.
City Attorney
Post Office Box 71
Alexandria, Louisiana 71309-0071
Jacques M. Roy Tel (318)449-5016' fax (318)449-5019
Mayor e-rnail charles.johnson@cityofalex.com
INTER-OFFICE RESPONSE TO COUNCIL PRESIDENT’S REQUEST FOR
REPORT CONCERNING CLECO LITIGATION ARGUMENTS RAISED BY
PATRICK LACOUR

June 16, 2009

Points prepared by

Utility Director
City Attorney’s Office

Patrick Lacour is an Alexandria citizen and ratepayer. He is a former Cleco internal


auditor and has approached the City of Alexandria Administration on multiple occasions
seeking a professional services agreement to provide energy management services. His
latest presentation to staff occurred at the behest of Myron Lawson, who requested a
meeting on Lacour’s behalf with the mayor and staff.

Mr. Lacour has offered information at council meetings on several occasions with which
there is considerable disagreement on issues of fact, legal interpretation/contract
construction, and basic power supply industry standard practices.

Staff will continue to rebutt any false or misleading allegations and acknowledge those
points that require continued vetting; however, because of the posture of the litigation,
Mr. Lacour (with some degree of esoteric knowledge) can distract the Council and
mislead the public regarding issues to which staff cannot respond fully because to do so
would compromise the City’s strategic negotiating position at this critical point in the
ongoing litigation.

We have communicated this to the mayor. The Mayor informed Mr. Lawson as recently
as the latest Executive Session.

Some initial points to consider:

1. It is true that five of Mr. Lacour’s nine years as a ratepayer (2000-2005) coincide
with the time period the City of Alexandria contends Cleco overcharged and
received excessive payments for electricity. The lawsuit references these
allegations in globo, with no input from Mr. Lacour. It is conceivable Mr. Lacour
overpaid; but so did every other City ratepayer. This is the very reason the
Randolph administration filed suit against Cleco. This point is obvious and adds
nothing to the debate which is not currently addressed.

2. According to the Louisiana Public Service Commission reported averages during


both the Randolph and Roy administrations, there is an incongruency with Mr.
Lacour’s claims. The reported numbers do not support Mr. Lacour’s 10-20%
alleged overage. However, for purposes of the lawsuit allegations and for the sake
of argument, we can assume overages within those claimed ranges. (When the City
is compared to its regional competitors, including Cleco, it is notable that for the
years 2000-2008, the LPSC reports the City’s average residential electric bill was
1.8% lower than Cleco, and 1.0% and 5.1% higher than Entergy GSU and Entergy
LPL respectively.) (Ref: Exhibit A - attached.)

Giving those assertions credit, it must be stated again this was the precise reason for
the lawsuit filed against Cleco which has gone on during the Roy Administration.
That being the case, the City is litigating the issue currently with Cleco, and has
never taken the position, in any manner, that the current arrangement in place is
being performed as the City contends it should be—that is the reason for the suit.
The City does claim it has exceeded previous performance parameters for the last
two years in favor of the City ratepayer. This discussion of continued performance
is not new, and was not raised by Lacour. Indeed, Cynthia Jardon of the Town Talk
has raised this issue innumerable times.

Mr. Lacour is not privy to the work and action of this administration, which remains
under seal and is subject to attorney-client privilege for good reason: he does not
know of the assessment work in determining cost-benefit analysis alternatives to
entering into a new power supply agreement with Cleco. The City continues to
engage in these determinations, particularly in this market, which is the reason the
Mayor has not executed any agreement with Cleco. The Mayor’s policy early on
was to independently vet through C.U.R.E. and two other independent professional
analysts any basic framework agreed to in principle. This policy is being followed,
and was not the product of any information from Lacour. It is incomplete.

Although Lacour has attempted to gain special access to City determinations,


assuring officials on numerous occasions of his capability and position as a former
employee knowing Cleco practices, he has never been on the litigation team.
Members of that team do not find his information new, beneficial, or an expansion
of the general options for the City. Each suggestion made by Lacour has been or is
being vetted—and was in a process of such action regardless of Lacour’s claims.

3. It cannot be seriously disputed that the Roy administration is more active than the
previous administrations in all aspects of the City’s energy purchases. The level of
professional and check-and-balance vetting is not belied by Lacour’s misguided
claims. They are supported by the fact that the Roy administration, as promised,
assembled a team of outside experts including: R. W. Beck (hired under the
previous administration), John Adragna (hired at this administration’s specific
request), GDS & Associates, and the Louisiana Municipal Gas Authority, and
continues to address each and every claim, even if frivolous. No contract will be
recommended by the Roy Administration until the Mayor and Chief Operating
Officer are satisfied with each element and provision being supported by a
qualified, independent professional opinion.

4. The March 26, 2009 meeting was called on behalf of Mr. Lacour by Mr. Myron
Lawson for the express purpose of Mr. Lacour and his proposed partners soliciting
a consultancy with the City. The Administration, after considering the
qualifications of Mr. Lacour’s entire team, all of whom were ex-Cleco employees
with only two (not including Lacour) having substantial power marketing or trading
experience, elected not to pursue Mr. Lacour’s offer as stated. Although Mr.
Lacour continues to rail against a non-competitive RFP for this process to provide
for power supply services, Mr. Lacour expected to receive his own contract with the
City without a competitive selection process or real vetting of his qualifications.
Nonetheless, the administration offered to send Mr. Lacour to Orlando to directly
engage R.W. Beck and determine if Lacour could be of any value. Mr. Lacour
presented his contract comparison and challenged the room to debate him. The
officials and experts elected to review the contract in a more temperate setting.
After doing so for less than half an hour and extensively since that time, it was
determined that Lacour’s legal analysis was wholly flawed. Mr. Lacour, at that
meeting, and through contact with professional engineers and accountants within
this City has sent word he expected the contract, would be willing to add persons to
the team if it would get him the contract, and would deride the current
Administration if he did not get the agreement.

5. When Mr. Lacour’s claims at that March meeting—similar to his claims now and in
the past—were vetted by industry professionals, including previous discussion with
some of Lacour’s own proposed team, the claims turned out to be woefully
deficient in basic legal application, materially misrepresentative of industry
standard terminology and application, and just wrong in some cases. Moreover,
Mr. Lacour constantly takes credit for basic assumptions and does not recognize the
difference between the actions leading to the best practice for the City (in which we
are all engaged) and the procedure to get there. That procedure includes litigation,
and that process takes considerable time.

6. Mr. Lacour is an ex-Cleco employee who was primarily responsible for internal
auditing, not power supply agreements or power marketing and trading.

7. Pursuing a traditional RFP process—discussed at great length during the December


hearings—was and remains impractical. Obviously, if the City pursued or is
pursuing another provider, the delicacy of these discussions and determinations,
until conclusion of the litigation, would not be discussed in a manner benefiting
Cleco, and therefore places the Administration staff at a decided disadvantage when
responding to Lacour’s unsupported allegations.

8. During the December 30, 2008 PSA Public Hearing, Mr. Lacour first asserted his
claim that Abbeville’s fixed price contract of $0.05/kwh was a better “deal” than
the proposed Alexandria PSA. Information presented during the hearing showed
that, on the very day of the hearing, the people of Abbeville paid $0.050/kwh when
the people of Alexandria were paying as little as $0.02941/kwh. For all of 2009,
Cleco’s cost of power delivered to the City has been well below Abbeville’s fixed
rate. (Ref: Exhibit B – attached)
9. Mr. Lacour sees fit to renew this false, misleading argument. In reviewing
Alexandria’s May invoice from Cleco, one can see Alexandria ratepayers were
charged, on average, $0.0439/kwh by Cleco while the ratepayers in Abbeville again
paid $0.05/kwh. (Ref: Exhibit C – attached)

10. In fact, the Abbeville contract, originally a seven year contract, has been noticed for
early termination by Cleco. Abbeville will now be forced to again negotiate for a
market based pricing PSA like most other municipal systems, not fixed rate. (Ref:
Phone call with Mayor Piazza, 6/9/09) and Exhibit K – attached)

11. Mr. Lacour has also alleged he gave the following advice to the administration
during the March 26, 2009 meeting: “… One significant item that I recommended
was starting up D. G. Hunter (at an assumed heat rate of 12,000 BTW/KWh per Mr.
Marcotte), which the administration did roughly a month later.” Through this
statement Mr. Lacour seems to erroneously claim credit for the Administration’s
decision to dispatch D. G. Hunter for economic reasons. What Mr. Lacour fails to
realize is that staff had been aggressively reviewing the economics of D. G. Hunter
since December 2008. The decision to possibly operate D. G. Hunter was put in
place long before Mr. Lacour’s March 26, 2009 meeting. There were numerous
meetings with the Mayor, city attorney, and finance director on this issue.

12. The St. Martinville and Alexandria PSAs together contain in excess of 114 pages.
Mr. Lacour’s entire argument is based on four (4) of those 114 pages. What Lacour
is not telling the citizens and ratepayers of Alexandria:

a. St. Martinville’s load is 15 MW; Alexandria’s load is 180 MW.

b. St. Martinville’s contract is a full requirements contract; Alexandria’s is a


net requirements contract. However, Cleco has an obligation to supply full
requirements to the City in the event the City’s LEPA or SWPA
entitlements are unavailable. Considering Cleco’s obligation to supply full
requirements (stand-by service) as a deliverable of the demand charge, the
City’s effective demand charge is $6.59/kW versus St. Martinville’s
$7.96/kW (before considering the value of the City’s generating credit of
$2.48/kw). The City’s staff and outside experts have reviewed and vetted
the attached analysis and find it sound. An independent expert has also
reviewed same and found the City’s effective rate may be slightly higher
than that stated herein. In either case the City’s effective demand charge
after generating credits is markedly lower than St. Martinville’s contracted
demand charge. (Ref: Exhibit L – attached)

c. The St. Martinville contract is a “levelized” contract. St. Martinville is


deferring current costs, currently $517,669.44, to be paid in the later years
of the contract. The City of Alexandria has no similar obligation. Mr.
Lacour is comparing, at best, apples to oranges. (Ref: Exhibits D and E –
attached)
d. The St. Martinville contract took effect in October 2007 and will expire
October 2012. The Alexandria contract has yet to take effect. Mr. Lacour
is comparing a contract negotiated two (2) years ago to a contract under
negotiation. Market conditions are completely different now.

e. Most importantly, the Alexandria PSA has an initial term of thirteen (13)
years with the option for extension in five (5) year increments. It is quite
common and acceptable to contract for a slightly higher price than
prevailing market for price guarantees in long term arrangements.
However, with the City’s version of compelled system average, not market
based, the City would gain both a long term agreement and one below
market. Because of contractual language, the City can compel this through
the basic legal doctrine of specific performance, enforceable by the Courts,
and receive damages for any breach. St. Martinville is shown a comparable
rate to the City, but is only guaranteed market power plus defers costs to be
paid later. So, while it looks comparable, it is not. If Cleco determines that
the market requires a change, it has that right under its proposal to St.
Martinville. This is not the case for Alexandria, but the City should not be
in the business of negotiating a better deal for St. Martinville by using its
very expensive services and professionals. Mr. Lacour’s actions are now a
cost to the City. The City has expended hours of energy on disproving
nonsensical legal issues.

f. The St. Martinville PSA contains a release of claims almost solely in favor
of Cleco. The Alexandria contract closed that Cleco standard for 13 years.
(Ref: Exhibit F – attached)

g. St. Martinville has no performance guarantee from Cleco; the City does.
(Ref: Exhibit G – attached)

h. St. Martinville has no challenge (audit) rights; the City has extensive
challenge rights. (Ref: Exhibit H – attached)

i. St. Martinville is subject to binding arbitration; the City is not. (Ref:


Exhibit I – attached)

j. Alexandria has the right to contest and/or reject future cost increases by
Cleco; St. Martinville does not. (Ref: Exhibit J – attached)
Respectfully submitted,

Michael P. Marcotte Date


Acting Director of Utilities
Exhibit A

Avg. Cost Per 1,000kwh How Does Alexandria Compare


Year Alex Cleco E-GSU E-LPL Cleco E-GSU E-LPL
2000 79.13 77.82 78.42 80.20 1.7% 0.9% -1.3%
2001 83.77 85.35 90.93 81.33 -1.9% -7.9% 3.0%
2002 73.67 75.35 75.12 72.65 -2.2% -1.9% 1.4%
2003 80.35 83.80 86.17 84.94 -4.1% -6.8% -5.4%
2004 84.01 86.17 88.52 86.90 -2.5% -5.1% -3.3%
2005 104.53 102.33 101.35 96.77 2.1% 3.1% 8.0%
2006 114.27 112.62 107.98 92.74 1.5% 5.8% 23.2%
2007 113.21 118.40 101.47 99.55 -4.4% 11.6% 13.7%
2008 118.04 124.33 112.37 114.84 -5.1% 5.0% 2.8%
Avg 94.55 96.24 93.59 89.99 -1.8% 1.0% 5.1%
Exhibit B

Alexandria Next Day Worksheet


Forecast for
12/30/2008 Tuesday Estimated Special Price: 1 $ 66.00

Hour Schedules / Generation Market Purchases (Without Transmission Charges) Total Estimated Estimated 12/30/2008
Ending RPS2 Hunter HYDRO Supp-Hydro MW's PRICE MW's PRICE MW's PRICE Per Hour Forecast Special Ending
1 54 8 $ 42.37 4 $ 29.41 66 69 3 1
2 54 8 $ 42.37 4 $ 29.41 66 67 1 2
3 54 8 $ 42.37 4 $ 29.41 66 68 2 3
4 54 8 $ 42.37 4 $ 29.41 66 67 1 4
5 54 8 $ 42.37 4 $ 29.41 66 71 5 5
6 54 8 $ 42.37 4 $ 29.41 66 76 10 6
7 54 3 8 $ 42.37 10 $ 37.50 75 83 8 7
8 54 7 9 $ 42.37 10 $ 37.50 80 88 8 8
9 54 7 9 $ 42.37 10 $ 37.50 80 91 11 9
10 54 5 9 $ 42.37 10 $ 37.50 78 88 10 10
11 54 9 $ 42.37 10 $ 37.50 73 89 16 11
12 54 9 $ 42.37 10 $ 37.50 73 84 11 12
13 54 9 $ 42.37 10 $ 37.50 73 82 9 13
14 54 9 $ 42.37 10 $ 37.50 73 78 5 14
15 54 9 $ 42.37 10 $ 37.50 73 76 3 15
16 54 9 $ 42.37 10 $ 37.50 73 76 3 16
17 54 9 $ 42.37 10 $ 37.50 73 75 2 17
18 54 5 9 $ 42.37 10 $ 37.50 78 82 4 18
19 54 7 9 $ 42.37 10 $ 37.50 80 85 5 19
20 54 7 9 $ 42.37 10 $ 37.50 80 83 3 20
21 54 5 9 $ 42.37 10 $ 37.50 78 81 3 21
22 54 9 $ 42.37 10 $ 37.50 73 76 3 22
23 54 9 $ 42.37 5 $ 29.41 68 72 4 23
24 54 9 $ 42.37 5 $ 29.41 68 68 0 24
25 0 0 0 0
1874
TOTAL 1,296 46 - 209 194 - - 1,745
Exhibit C

INVOICE NUMBER
ALEX-0509
PLEASE SHOW THIS NUMBER

WHEN REMITTING

2030 Donahue Ferry Rd INVOICE DATE


Pineville, LA 71360 9-Jun-09

DUE DATE
20TH OF INVOICING
MONTH
CITY OF ALEXANDRIA
DIRECTOR OF UTILITIES
P. O. BOX 71
ALEXANDRIA, LA 71309-0071
Attn: Julie Fax 449-5080 julie.campbell@cityofalex.com

May-09
ENERGY BILLING

21,824 MWH SPECIAL 36.23 $/MWH $790,596.96


TRANSMISSION (Sch. 7, 8, & 1) $111,400.29
MANAGEMENT FEE $53,444.00
Total before credits $955,441.25

LESS:
254 MWH Energy Buyback -$31.24 $/MWH -$7,936.20 -$7,936.20

MW Generated 0 Less credit for $1 capacity $0.00


less MW sold 0 Less credit for buyback of power $0.00
MW for Capacity Credit of $1 0

Total Energy Billing $947,505.05

Alexandria Hydro Transmission - May $16,492.28

Entergy Transmission - May $34,535.44

*Sales of 0 MW off of Alexandria Generation

Operating Reserves Service Schedule OR


7,000 KW x $2.80/KW $19,600.00

Regulation Service Schedule RS


Monthly Charge (Including Sch. 2 Volt/Var Ancl.Serv.) $5,200.00

Total Service Schedules $24,800.00

TOTAL BILLING $1,023,332.77

If possible, please notify us at least1day in advance by E-Mail of the date the payment will be made: mike.sawrie@cleco.com
Cleco Cleco
JPMorgan Chase Bank, NA JPMorgan Chase Bank, NA
ABA# 021000021 ABA# 071000013
Acct# 5737400 Acct# 5737400
Reference: Note your company name Reference: Note your company name
Captial One Repetitive Code #HWN30351
C:\Documents and Settings\mmarcotte\Local Settings\Temporary Internet Files\OLK7C\05-2009 ALEX Invoice INVOICE 6/10/2009 1:11
PM Cost Per kwh: $0.0439
05/04/2009 22:14 3373942244 PAGE 15
Exhibit D

EXHIBIT A

St. Martinville Monthly Charges

The Monthly Bill shall be calculated as follows:

A. Customer Charge of$400.00;

B. Plus Demand Charge of$4.41 per kW of Demand for each month between January, 2008 and
December, 2009, and $7.96 per kW of Demand for all other months, where Demand is calculated
as follows:

For normal loads, the Demand shall be the highest amount determined in accordance with any of
the following provisions:

(I) The highest 15 minute peak kW load, adjusted to the nearest whole kilowatt,
measured during the current month.
(2) 100% of the highest demand similarly established during the preceding eleven
months, excluding the months of January, February, March, April, May, October,
November and December.
(3) 50% of the Contract Power specified in the Agreement for Electric Service.

C Plus Energy Charges of$0.00155 per kWh x TDE;

D, Plus all Transmission Charges;

E. Plus the Original Fuel Charge or the Alternate Fuel Charge, as provided below.

The Original Fuel Charge will be the sum 0[(1) the Projected Fuel Charge ("PFC") and (2) Specific
Purchases. The Original Fuel Charge will be used unless the Alternate Fuel Charge applies.

PPC equals the Projected Fuel Charge Rate ("PfeR") x Cleco System Energy ("CSE") for all
hours during the prior Billing Month,

The PFCR is $0.04789 per kilowatt hour for all hours during the months of January 2008 through
December 2009, and is $0.03705 per kilowatt hour for all hours during the months of January
2010 through December 2012.

CSE equals the total number of kilowatt hours, in each hour, by which Total Delivered Energy
("TOE") exceeds Specific Purchased Delivered Energy ("SPDE"),

TDE equals the total number of kilowatt hours in each hour delivered to the Point of Delivery in
accordance with Article V.

SPDE equals the total number of kilowatt hours, if any, purchased by CLECO and delivered to
the Point of Delivery in each hour.

Specific Purchases equals the total amount, in dollars, of all purchases made by CLECO that are
allocated to ST. MARTINVILLE 10r the month prior to the Billing Month,

33
In addition, for all months during which the Fuel Charge is calculated using the Original Fuel Charge
formula, a Fuel Charge Differential ("FCD") shall be calculated each month as follows:

FCD equals (FCAW - PFCR) x CSE, for all hours during the Billing Month, divided by the (0 tal

number of months remaining in the Initial Term; where

FCA W equals the Fuel Cost Adjustment as calculated in accordance with the "Wholesale Fuel
Adjustment Clause", attached as Exhibit B.

The amount of the FeD calculated each month shall be added to, or subtracted from, as appropriate, the
total Monthly Bill for all remaining months of the Tenn.

CLECO shall calculate each month the Cumulative Fuel Charge Differential ("crCD") as follows:

CFCD equals the sum of all unpaid FCD charges for all months remaining in the Initial Tenn.

Each Monthly Bill shall reflect the CFCD.

If the CFCD reaches $500,000.00, then beginning with the next month, the Original Fuel Charge shall be
replaced with the Alternate Fuel Charge, unless ST. MARTINVILLE provides CLECO with a Letter of
Credit in the amount of $2,000,000.00.

The Alternate Fuel Charge will be the sum of (1) (the larger ofFCA W or PFCR) x CSE, for all
hours during the prior Billing Month; and (2) Specific Purchases.

During any month in which the Alternate Fuel Charge formula is utilized, the FCD Charge for each month
during which a peD was calculated will be added to Or subtracted from, as appropriate, the total Monthly
Bill for all remaining months of the Term.

If the CFCD reaches $500,000.00 and ST. MARTINVILLE elects to calculate the Fuel Charge in
accordance with the Alternate Fuel Charge formula, the Alternate Fuel Charge formula will be used until
the CFCD is reduced to $250,000.00.

Beginning with the first Billing Month following the month in which the CFCD is reduced to
$250,000.00, the Original Fuel Charge formula will be used.

34

S£ 39\;;1d
Exhibit E

Cleco Power, LtC


PO Box 69000
Alexandria, LA 71306-9000

City of St. Martinville FOR PERIOD:


P.O. Box 379 FROM: Apr 1, 2009
New Iberia LA 70560-0000 TO: Mav 1 2009

0000379756001 Bill Date: OS/lB/2009

MCTE~
NU~lIlCR I ~eADlNG I MULTI-
PlIER I KlLOWAnS
(I<!N\
MCTER
NUt~BER
I
J
~lNG
PRESENT I PREVIOUSI DIFFERENCE
II~-I KIlDWATlHOURS
(KWt1)
()"~lAND' ENERGY:
075109649 I 9,176 1 000 I 9 176 075109649 I 139763 I 135686 I 4 077 I 1,000 I 4077 000

!RKVAH:
075109649 15.0911 n487 1 1,604 I 1,000 1 1,604,000 I
C"ctomer Charge s "100,00

DCIrnIJId BILLING:
BlUing Demand Aug-2oo8 14,784 !WI AT "1."11 PE;R !WI D
$ 65,197.44 $ 65,197.44

ENERGY IIIlLING:
TOlal Delivere(l Energy 4,077,000_ KWH AT 1. 0.00155 PEP. !WIH ~ $ 6J19.35 $ 6,319.35

fUEL 8IL.I.ING:
Less I'UrCnaseo Energy
FUel Cost Adj
3,628,000
449,000
!WIH
!WIH
AT
AT
s
$
0.02aa7
0.04564
PER KWH
PER KwH
- $
$
t04,72?50
20,492.36 $ 125,21'l.86

OEFER.R.ED FUEL PAYMENT: $ 11,765,21

TRANSMISSION CHARGE: $ 18,625.31

CLECO TRAN$t4ISSIOH CHARGI::


Network s 11.606.15
DISp. 8< Control And. ill 817.92
Volt/Var And, Service $ 367.16
Reg, & Freq, Response $ 321.72
Energy Imbalance s
Spinning Res€!rVes $ 459.85
Suppleme;,e,,1 Reserves s 459.85 $ 14,032.65

SUBTOTAL $ 241,55"1.82

Lllle Item:
Cumulative FUel Charge Differential (CfCD) $ 517,669.1"1

TOTAL $ 241,554.82

LE 39\Jd
Exhibit F (Taken from St. Martinville PSA)

lockout, work stoppage or any industrial disturbance or dispute in which it may be involved, or

to seek review of or take an appeal from any administrative or Judicial action.

8.20 Tennination and Release of ExisTing Power SupPl~ements

ST. MARTINVILLE and CLECO agree that the "Contract for the Sale of Energy and Use of

Substation Facilities Agreement Between Central Louisiana Electric Company Inc. and The

City Of St. Martinville, Louisiana" dated March 4, 1993 is hereby terminated as of the Effective

Date of this Agreement without further notice, and that any notice of termination requirements

therein are hereby waived. ST. MARTINVILLE and CLECO further agree that, other than any

payment obligations by ST. MARTINVILLE to CLECO for performance rendered to the date of

termination, each Party hereby releases, acquits and forever discharges the other Party, its

successors and assigns and any employees, officers, directors, members or shareholders of

same, mayor, council, and municipal employees from any and all claims, demands, damages,

liabilities or causes of action of any kind whatsoever, known or unknown. whether in contract Or

in tort, at common law, statutory or otherwise, including attorney's fees and costs, which each

Party might have or assert in the future, arising out of Or in any way relating [0 the "Power

Supply Agreement Between Central Louisiana Electric Company Inc. and The City Of SL

Martinville, Louisiana" dated March 4, 1993.

8.21 Representations and Warranties

On the date of entering into this Agreement, each Party represents and warrants to the other
Party that:

(i) it is duly organized, validly existing and 10 good standing under the laws of the
jurisdiction of its formation:

(ii) it has all regulatory authorizations necessary for it to legally perform its obligations
under this Agreement;

(iii) the execution, delivery and performance of this Agreement is within its powers, has been
duly authorized by all necessary action and does not violate any of the terms and

26

8(; 39\Jd pp(;(;p5U££


Exhibit G (Taken from Alexandria PSA)

8.1 Events of Default

An “Event of Default” shall mean with respect to a Party (the “Defaulting Party”): (i) the failure

by the Defaulting Party to make, when due, any payment required under this Agreement, provided that

such failure is not cured within five (5) Business Days after written notice of such failure is given to the

Defaulting Party; (ii) CLECO becomes Bankrupt and ceases to sell the Full Requirements to

ALEXANDRIA as required under this Agreement; (iii) CLECO’s intentional, bad faith refusal to sell the

Full Requirements to ALEXANDRIA, provided that such refusal is not cured within five (5) Business

Days after written notice of such default is given by ALEXANDRIA to CLECO; (iv) ALEXANDRIA’s

intentional, bad faith refusal to purchase the Full Requirements from CLECO, provided that such refusal

is not cured within five (5) Business Days after written notice of such default is given by CLECO to

ALEXANDRIA; (v) ALEXANDRIA’s intentional, bad faith breach of its assignment of the energy and

capacity of Hunter to CLECO, provided that such refusal is not cured within five (5) Business Days after

written notice of such default is given by CLECO to ALEXANDRIA; or (vi) ALEXANDRIA’s failure to

provide the ALEXANDRIA Letter of Credit, other than due to CLECO’s failure to pay for the

ALEXANDRIA Letter of Credit, as such is required under Section 10.2. If the Net Dependable

Generating Capacity of Hunter drops below 125,000 kW, but ALEXANDRIA remains current in paying

the monthly invoices calculated in accordance with Exhibit A to this Agreement, then such drop in

capacity shall not, standing alone, constitute an Event of Default under this Section 8.1. In the event of

any other breach or default under this Agreement that does not constitute an Event of Default under this

Section 8.1, the remedies available to the non-defaulting or non-breaching party shall include specific

performance or damages but shall not include the early termination or dissolution of this Agreement.
Exhibit H

9.13 ALEXANDRIA’s Right to Challenge

Nothing in this Agreement, including the exhibits and schedules attached hereto, shall

constitute or be construed as a waiver or limitation of the rights of ALEXANDRIA, under law, at

equity, or under the terms of this contract, to challenge the legality, the justness and

reasonableness, or consistency with and permissibility under this contract, of (i) any cost sought

to be passed through or included in the charges produced by the terms of this Agreement, (ii) any

cost, fuel, energy, load, transmission or other data or calculations or analyses employed in the

determination of the charges under this Agreement, or (iii) the monthly charges produced under

this Agreement. ALEXANDRIA shall have the right to challenge all inputs to, calculations, and

resulting levels of, the Monthly Demand Charge, the Monthly Fuel Charge, and the Wholesale Fuel Cost

Adjustment determined pursuant to Exhibits A and A-1 to this Agreement, and any other charge or

calcuation affecting charges under this Agreement, provided that (i) ALEXANDRIA shall not have the

right to challenge a change to the Demand Charge to which it specifically agreed pursuant to Section

9.12.b (but provided that this provision does not prejudice ALEXANDRIA’s challenge rights with respect

to the calculation and level of the Monthly Demand Charge or other monthly charges), and (ii) this

Section does not modify the one-year challenge period for a Proposed Adjustment under Section 9.12.b.

Nothing in this section is intended to modify or limit Section 6.2 of this Agreement,

provided that ALEXANDRIA’s ability to exercise the legal and equitable rights to challenge set

forth in this Section 9.13 and to obtain any remedy available at law or in equity shall not in any

way be limited by the twelve (12) month challenge period for invoices set forth in Section 6.2

and, provided further, that any such challenge under this Section 9.13 by ALEXANDRIA shall

be initiated no later than sixty (60) months after the month in which the disputed cost, calculation

or charge was reflected in an invoice issued by CLECO under this Agreement. For the avoidance

of doubt, and consistent with the first sentence of Section 9.12 of this Agreement, the $400.00
Monthly Customer Charge, the $4.50 per kW and $10.50 per kW Demand Charge, and the

$0.002 per kWh Monthly Energy Charge specified in Exhibit A to this Agreement shall not be

subject to challenge by ALEXANDRIA.

9.14 ALEXANDRIA’s Right to Information

In order to review the charges produced under this Agreement, ALEXANDRIA shall have access

to all docments and information in CLECO’s possession reasonably necessary for ALEXANDRIA to

evaluate any proposed changes or changes in charges pursuant to Section 9.12, Exhibits A, and A-1 to this

Agreement, and any other calculation affecting charges or payments under this Agreement, including, but

not limited to, the information provided by CLECO pursuant to Section 9.12, and the information that

CLECO is obligated to provide each month pursuant to Section 9.33 and Schedule 9.33. If

ALEXANDRIA requests information and data in addition to the foregoing information and data, CLECO

shall respond to such request within ten (10) Business Days. CLECO shall be entitled to reasonable

compensation for the actual cost of compiling and providing any additional information requested by

ALEXANDRIA, provided that a dispute as to what constitutes the actual costs shall not delay the

provision of the requested information within the required ten (10) business days to ALEXANDRIA.

To the extent that either party maintains that information to be provided under this Agreement is

confidential, the Parties agree to abide by the terms of the Confidentiality Agreement attached hereto as

Schedule 9.14.

In the event that the LPSC permits assets to be included in CLECO’s rate base pursuant to a rider,

and ALEXANDRIA has agreed that such assets are to be included in the Demand Charge, CLECO shall

provide ALEXANDRIA, on a monthly basis, the data and calculations that produce the amounts to be

flowed through the rider and the data and calculations that produce the change in the Monthly Demand

Charge. CLECO shall also provide any additional information reasonably requested by ALEXANDRIA

within ten (10) Business Days after receipt of such request. CLECO will be entitled to be compensated

for its actual costs of responding to such request for additional information by ALEXANDRIA.
Any data or information required to be provided to ALEXANDRIA under this Section shall be

sent to an outside counsel who is designated by ALEXANDRIA and subject to the Confidentiality

Agreement attached hereto as Schedule 9.14.

9.15 Challenge Procedures

In the event that ALEXANDRIA invokes its right to challege a charge under this Agreement, the

Parties shall abide by the following procedures:

a) In order to initiate a challege under this Agreement, ALEXANDRIA shall provide

CLECO with written notice that it is protesting the Monthly Demand Charge, Monthly

Fuel Charge, or other charges produced by this Agreement’s rates (“Challenge Notice”).

ALEXANDRIA’s Challenge Notice shall provide the month(s) of charges subject to

challenge, the basis for its challenge to the Monthly Demand Charge, Monthly Fuel

Charge, or other charges and state, if feasible, the proposed adjustment to the charges.

b) Upon reciept of ALEXANDRIA’s Challenge Notice, all payments made by

ALEXANDRIA for Monthly Demand Charges, Monthly Fuel Charges, or other charges

shall be paid to CLECO subject to refund plus interest (calculated according to the

Interest Rate specified herein) upon completion of a successful challenge. For purposes

of this section, a successful challenge shall include any order of the FERC or any agency

or court in which such challenge may be brought under this Agreement, or any settlement

of such challenge, the effect of which is to change the Proposed Adjustment and reduce

the charges to ALEXANDRIA.

c) CLECO shall have thirty (30) days to provide a written response to ALEXANDRIA’s

Challenge Notice either (i) agreeing to modify the charges under challenge as requested

in the Challenge Notice; or (ii) providing the basis for CLECO’s belief that the charges

are accurate. A failure by CLECO to respond to a Challenge Notice within the thirty
(30) day period will be deemed agreement by CLECO with the Challenge Notice and the

requested change in charges.

d) In the event that CLECO disputes ALEXANDRIA’s challenge, the Parties shall have

thirty (30) days from ALEXANDRIA’s receipt of CLECO’s response disputing the

challenge to resolve the dispute.

e) In the event the Parties do not resolve the dispute within thirty (30) days, ALEXANDRIA

shall retain all legal rights it has to seek redress of the matter before FERC or the United

States District Court for the Western District of Louisiana.


Exhibit I

conditions in its governing documents, any contracts to which it is a party Or any law,
rule, regulation, order Or the like applicable to it;

(iv) this Agreement constitutes its legally valid and binding obligation enforceable against it
in accordance with its terms, subject to any equitable defenses:

(v) it is not involved as a debtor in voluntary or involuntary bankruptcy proceedings under


the United States Code, and there are nO proceedings pending or being contemplated by
it or, to its knowledge, threatened against it which would result in it being or becoming a
debtor in voluntary or involuntary bankruptcy proceedings under the United States Code;

(vi) there is no pending or, to its knowledge, threatened legal proceeding against it or any of
its affiliates that could materially adversely affect its ability to perform its obligations
under this Agreement;

(vii) no Event of Default with respect to it has occurred and is continuing, and no such event
or circumstance would occur as a result of its entering into or performing its obligations
under this Agreement;

(viii) it is acting for its own account, has made its own independent decision to enter into this
Agreement and as to whether this Agreement is appropriate or proper for it based upon
its own judgment, is not relying upon the advice or recommendations of the other Party
in so doing, and is capable of assessing the merits of and understanding, and understands
and accepts, the terms, conditions and risks of this Agreement;

(ix) it has entered into this Agreement in connection with the conduct of its business, and it
has the capacity Or ability to make Or take delivery of all capacity, energy and services
referred to herein to which it is a Parry.

8.22 Title and Risk of Loss.

Title to and risk of loss related to the Product shall transfer from CLECO to ST.

MARTINVILLE III the Point of Delivery. CLECO warrants that it will deliver to ST.

MARTINVILLE the 'Product free and clear of all liens, security interests, claims and

encumbrances or any interest therein or thereto by any person arising prior to the Point of

Delivery.

8.23 Dispute ResolutioQ,

Conference: If any dispute arises under this Agreement, which cannot be resolved by the

Parties, either Party may send to the other Party a notice of dispute and request a conference for

27

b(; 3911d
vvUv5EL££ 11:£(; 500(;/£0/90
resolution of that dispute. Within three Business Days after delivery of such notice. each Party

shall nominate a representative to meet in alternating locations in St. Martinville. La. and

Pineville, La., or at any other mutually agreed locution, to resolve the dispute. The conference

shall be convened within ten days after exchange of those nominations unless the Parties

mutually agree to another date. If the Parties are unable to resolve the dispute at the conference

provided for in this section, either Party may pursue the remedies provided in the next

paragraph.

Arbitration: Any controversy or claim arising out of Or relating to this Agreement or the breach

hereof which cannot be resolved amicably shall be settled by arbitration. This agreement to

arbitrate shall he specifically enforceable under prevailing arbitration law. The award of the

arbitrator(s) shall be final, and a judgment may be entered upon it by any court having

jurisdiction.

A Party desiring to invoke this arbitration provision shall serve written notice upon the other of

its intention to do so. Matters that have an economic value of less than $1,000,000 shall be

presented before a single arbitrator. Matters that have an economic value of $ 1,000,000 or more

shall be presented before a panel of three arbitrators. Within fifteen days of the date of such

notice. each Parry shall serve upon the other {he name of one individual to serve as a party

arbitrator. If either Party fails to select all arbitrator and notify the other Party of the selection

within such fifteen-day period. the other Party may request the American Arbitration

Association to select the arbitrator on behalf of the Party that failed to identify an arbitrator. For

matters greater than $ 1,000,000, the two arbitrators selected by the Parties shall select a third

arbitrator within fifteen days after their selection; if the two arbitrators cannot agree upon a

third arbitrator, the American Arbitration Association shall select (he third arbitrator. For

28

BE 39\;jd
matters of $1 ,000,000 Or less, after each Party designates an arbitrator, the Parties shall attempt

to select a single arbitrator from the two designated arbitrators. If the Parties do not reach

agreement regarding the selection of a single arbitrator within fifteen days of the date on which

the second arbitrator was designated, the Parties shall ask the American Arbitration Association

to select an arbitrator from the two arbitrators designated by the Parties. The arbitration shall be

conducted in accordance with the Commercial Arbitration Rules of the American Arbitration

Association then prevailing, and shall be conducted in alternating locations of St. Martinville,

La. and Pineville, T .a., unless the Parties agree otherwise. Discovery shall be permitted in

accordance with the procedures set forth in the Federal Rules of Civil Procedure, but to a degree

limited by the arbitrators as they deem appropriate to render the proceedings economical,

efficient, expeditious and fair. Interest at the rate provided for in this Agreement shall be added

to the monetary award for sums found to have been due under this Agreement. Except as

otherwise directed by the arbitrator(s), each Party shall bear its OWncost of the arbitration.

8.24 Audit

Each Party shall keep such records as may be necessary to afford the other a clear history of all

deliveries of Product hereunder. Each Party has the right, at its sole expense and during normal

working hours, to examine the records of the other Party to the extent reasonably necessary to

verify the accuracy of any statement, charges Or computation made pursuant to this Agreement.

If requested. a Party shall provide to the other Party statements evidencing the quantity

delivered at the Point of Delivery. If any such examination reveals any inaccuracy in any

statement, the necessary adjustments in such statement and the payments thereof will be made

promptly and shall bear interest calculated at the Interest Rate from the date the overpayment or

underpayment was made until paid; provided, however, that no adjustment for any statement or

payment will be made unless objection to the accuracy thereof was made prior to the lapse of

29

IE 39\jd PPC;C;P5ELEE
Exhibit J

9.12 Changes in Rates, Charges, Terms, and Conditions

All rates, terms and conditions as specified in this Agreement shall remain in effect in accordance

with their terms and shall not be subject to change through application by either Party to FERC pursuant

to the provisions of Section 205 or 206 of the Federal Power Act. Absent the agreement of all Parties, the

standard of review for changes to any Section, Exhibit, Schedule or attachment in this Agreement

proposed by a non-party, or FERC acting sua sponte, shall be the most stringent standard permitted by

law. The standard of review for any dispute regarding application, interpretation, or operation of this

Agreement adjudicated before FERC shall be the just and reasonable standard.

a. Changes to the Demand Charge

The Parties recognize and acknowledge that the rates set forth in this Agreement are

based upon assets included in CLECO’s retail rates, as allowed by the LPSC. If the conditions

of this section 9.12 are met, changes in the assets allowed by the LPSC in CLECO’s retail base

rates or riders (excluding the inclusion of the costs of construction for Rodemacher Unit 3 and

purchased power and interruptible capacity costs that are included in the Demand Charge as set

forth in Exhibit A of this Agreement) may result in a change in the Demand Charge set forth in

Exhibit A.

In the event that CLECO seeks a change in the Demand Charge, CLECO shall, as a

condition to the effectiveness of the proposed change, provide to ALEXANDRIA: (i) evidence,

in the form of an LPSC order or other evidence satisfactory to ALEXANDRIA, that specific

assets of CLECO have been permitted to be and are included in CLECO’s retail rates; (ii) a

written statement identifying (A) the proposed change in the Demand Charge and providing a

detailed explanation of, and the specific calculations that produced, the proposed change in the

Demand Charge and (B) the estimated change in the Monthly Fuel Charge, including a separate

identification of the estimated change in the Wholesale Fuel Cost, calculated pursuant to Exhibit

A-1, produced by the inclusion of the asset(s) proposed by CLECO to be included as part of the

Demand Charge for each month that the change would be in effect, and providing a detailed
explanation, including all assumptions, of, and the specific calculations that produced, the

estimated change in the Monthly Fuel Charge and Wholesale Fuel Cost; and (iii) the effective

date of said changes and the period of time such changes would be in effect. CLECO shall be

required to identify the additional assets included in its retail rate base (and resulting changes in

retail base rates or riders as described above) and provide to ALEXANDRIA a copy of

supporting data for the changes in its retail base rates or riders and the proposed changes to the

Demand Charge and the Monthly Fuel Charge and Wholesale Fuel Cost Adjustment. Such

supporting data shall include an estimate for the remaining Primary Term of this Agreement (or,

in the event the Primary Term has expired, for the remaining then-current Succeeding Term) of

the new Demand Charge and resulting change in the calculation of the Monthly Fuel Charge

with and without the additional assets.

The notice of such proposed rate changes and supporting materials and data provided for

in this Section shall be provided by CLECO to ALEXANDRIA at least one hundred eighty

(180) days prior to the date on which the new Demand Charge is scheduled to take effect

(“Notice of Demand Charge Change”). CLECO shall provide additional supporting data

reasonably requested by ALEXANDRIA to assist ALEXANDRIA in evaluating the new

Demand Charge and Monthly Fuel Charge pursuant to this Section.

In the event that (i) the cost of transmission assets are allowed in CLECO’s retail rate

base by the LPSC, and (ii) the cost of such assets will be recovered under CLECO’s OATT or

any successor thereto for the transmission service required for CLECO service to

ALEXANDRIA under this Agreement, CLECO shall not seek recovery of, and shall not

recover, any costs related to such transmission asset from ALEXANDRIA pursuant to this

Section 9.12.

b. Alexandria’s Option to Forgo Changes in Demand Charge and Monthly Energy


Charge
Upon receipt of a Notice of Demand Charge Change, ALEXANDRIA shall have the

option, within one hundred and twenty (120) days from the receipt of such notice, to: (i) accept

the change in the Demand Charge as proposed by CLECO and any resulting change in the

calculation of the Monthly Fuel Charge, or (ii) forgo the proposed change in Demand Charge

and likewise forgo any resulting change in the calculation of the Monthly Fuel Charge that is

associated with the additional asset(s) that resulted in the proposed change in the Demand

Charge. ALEXANDRIA’s acceptance or rejection of the change in the Demand Charge shall be

made in writing. If the City does not timely provide such written notice of its election, then the

new Demand Charge set forth in the Notice of Demand Charge Change from CLECO to

ALEXANDRIA shall become effective on the date set forth in such notice without any further

action of either Party.

Upon written notice by ALEXANDRIA forgoing the proposed change in Demand

Charge and Monthly Fuel Charge, the Parties shall undertake to agree, with such agreement not

to be unreasonably withheld, on an appropriate adjustment to exclude the estimated effect of the

additional asset(s) in CLECO’s retail base rates or riders from the Monthly Fuel Charge. Such

adjustment may be based on an agreed-upon simplified methodology or a fixed change in the

Monthly Fuel Charge that would approximate the change in the Monthly Fuel Charge had the

additional asset(s) not been included in CLECO’s retail base rates or riders. If the Parties have

not agreed on an appropriate adjustment at least thirty (30) days prior to the effective date of a

change in the Demand Charge, CLECO shall provide to ALEXANDRIA, in good faith, an

amendment providing its proposed adjustment to the Monthly Fuel Charge to exclude the

estimated effect of the additional asset(s), including supporting data used to compute the

proposed adjustment (“Proposed Adjustment”). The Proposed Adjustment shall go into effect on

the effective date set forth in the Notice of Demand Charge Change provided by CLECO,

subject to refund plus interest (calculated according to the Interest Rate specified herein) upon

completion of a successful challenge. For purposes of this section, a successful challenge shall
include any order of the FERC or any agency or court in which such challenge may be brought

under this Agreement, or any settlement of such challenge, the effect of which is to change the

Proposed Adjustment and reduce the charges to ALEXANDRIA. ALEXANDRIA shall retain

all legal rights to challenge the Proposed Adjustment before FERC or the United States District

Court for the Western District of Louisiana, which rights shall be exercised no later than one

year from the effective date of the Proposed Adjustment.

c. Other Changes to Monthly Fuel Charge and Wholesale Fuel Cost

The Monthly Fuel Charge and Wholesale Fuel Cost components are products of the

operation of the formulas set forth in Exhibit A and Exhibit A-1. In addition to any changes

associated with the changes to the Demand Charge set forth in Section 9.12 a. and b., above, the

Monthly Fuel Charge and Wholesale Fuel Cost will continue to be separately calculated each

month.
Exhibit K

City of Abbeville
Regular Meeting
January 20, 2009

The Mayor and Council of the City of Abbeville met in regular session on January 20, 2009 at
5:30 P.M., at the regular meeting place, the Council Meeting Room located at 101 North State
Street, with the Honorable Mark Piazza, Mayor presiding.

Members Present: Council Members Francis Plaisance, Mayor Pro-Tem, Carbett


Duhon, Wayne Landry, Joe Hardy and Francis Touchet, Jr.

Members Absent: None

Also Present: Elvin Michaud, Jr., Fire Chief


Rick Coleman, Police Chief
Ike Funderburk, City Attorney
Clay Menard, Public Works Director
Richard Primeaux, Engineer
Jeremiah Bolden, City Marshal
Ricky LaFleur, Attorney
Bart Bellaire, City Prosecutor
Kelly Mire, Chairman of Abbeville Parks and Recreation Board
Mr. Jules Hebert, Link Hebert and Luke Looney, Boy Scout
Pack #326

Mayor Piazza asked the members of the Boy Scout Pack #326 to lead the assembly in Pledge
of Allegiance. Mayor Piazza asked Councilman Wayne Landry to lead the assembly in prayer.

-01 introduced by Mr. Carbett Duhon and seconded by Mr. Francis Plaisance to ratify bills
paid in the month of December 2008. The motion carried unanimously.

-02 introduced by Mr. Wayne Landry and seconded by Mr. Francis Touchet, Jr. to approve
the provisional appointment of Kerry Thomas as a Maintenance Worker 1 in the Street
Department pending successful completion of all post-hire procedures. The motion carried
unanimously.

-03 introduced by Mr. Francis Plaisance and seconded by Mr. Francis Touchet, Jr. to approve
the suspension of all employee salary adjustments in the Municipal, Fire and Police
Departments for a period of six months, effective immediately. The motion carried
unanimously.

Councilman Francis Plaisance began a discussion on overtime. There should be a cap on the
overtime paid and the rest would be paid in compensatory time. Councilman Touchet stated
if there is a department that is causing problem we should look at it. Councilman Plaisance
added we could research the overtime as a whole a set a reasonable cap. Mayor Piazza
stated he agreed with Councilman Plaisance and recommended a cap of 24 hours per person
per payroll with the amount of overtime over 24 hours to be paid in compensatory time. One
department had employees making between 50 and 70 hours of overtime per payroll. This is
excessive and abusive. This cap would be over and above any holiday and grant pay and an
exception would be made for emergency situations.

-04 introduced by Mr. Francis Plaisance and seconded by Mr. Francis Touchet, Jr. to cap
overtime to 24 hours per person per payroll and the balance to be paid by compensatory time.
This would be above any holiday and grant paid overtime with an exception for emergency
situations which are to be addressed directly with the Mayor. The motion carried
unanimously.

-05 introduced by Mr. Francis Plaisance and seconded by Mr. Wayne Landry to authorize the
Mayor to hire Mr. Don Strobel, a labor law consultant on staff with LMA, to make sure we
are properly addressing the minimum wage issue and all other payroll issues. The motion
carried unanimously.

1
Mayor Piazza asked Marshal Bolden about his intentions to hire a deputy. Marshal Bolden
would like someone post-certified and willing to attend the police academy. Mayor Piazza
asked Marshal Bolden to consult with the Council once suitable applicants are found.

Mrs. Charlene Beckett gave an update on the activities of Keep Abbeville Beautiful. In
December a letter was sent out with the utility bills proclaiming January as abandoned
vehicle month. The group met with the Mayor and the Vermilion Parish Police Jury to
discuss recycling. A planning meeting with be held Monday at 12:00 PM at City Hall.

Mrs. Charlene Beckett gave an update on Main Street. The cookbook is available for sale.
412 cookbooks have been sold so far. The Christmas Stroll was held in December. The turn
out was not as high as those in the past due to the very cold weather, however it was still very
successful. The Christmas ornament this year highlighted City Hall. Volunteers have
cleaned up the Guarino Blacksmith Shop Museum and panels depicting the Guarino family
and blacksmith shop history will be mounted soon. A budget sheet was also discussed by Mrs.
Beckett describing the various Main to Main projects held and the grant proceeds received
for those events.

Mr. Kelly Mire provided an update on the Abbeville Parks and Recreation Board and the
topics at their recent meeting. Several issues were addressed as follows:
1. Requested an ordinance be adopted that bans smoking in all ball fields in all City
Parks.
2. Park Rules were presented and discussed. Signs will be ordered to place in the parks
that display these rules.
3. Fees for field usage for Abbeville High, Vermilion Catholic, and Harvest Time were
presented.
4. Theriot Field is in full swing. It is looking very good.
5. Discussed the signs that are put up inside the fields. Mr. Mire stated that the
proceeds made from the sale on the signs should be divided as ½ to go back into the
program and ½ back to the Abbeville Parks and Recreation Board for maintenance of
that field. Mayor Piazza added he had suggested that the money be placed back into
the field where the sign is sold. In the past those fees have been placed back into
other programs and other fields so that money is sometimes short to repair that field.
6. Requested the pavilion at McKinley Scott Park be raised so they may have a summer
basketball league in that pavilion.
7. Discussed walking trail at Gertie Huntsberry Park. Requested permission to get with
Richard Primeaux to scale back project in order to get work started. Richard has
started a topographic project for drainage for this and a scaled down project has
been already been drawn.

-06 introduced by Mr. Francis Touchet, Jr. and seconded by Mr. Francis Plaisance to
authorize the City Attorney to draft an ordinance to ban smoking in all ball fields in all City
Parks. The motion carried unanimously.

-07 introduced by Mr. Francis Touchet, Jr. and seconded by Mr. Wayne Landry to approve
the final draft of park rules and to add no profanity to those rules providing this is not already
included in a City ordinance. The motion carried unanimously.

-08 introduced by Mr. Francis Touchet, Jr. and seconded by Mr. Francis Plaisance to accept
recommendation of fees for Abbeville High, Vermilion Catholic and Harvest Time. The
motion carried unanimously.

-09 introduced by Mr. Francis Plaisance and seconded by Mr. Carbett Duhon to ratify the
action of the Abbeville Parks and Recreation Board so as ½ of the proceeds from the sale of
signs inside the fields be put back into the program and ½ be put into the Abbeville Parks and
Recreation Board for maintenance of the field where the sign was sold. The motion carried
unanimously.

-10 introduced by Mr. Francis Plaisance and seconded by Mr. Joe Hardy to deviate from the
agenda to discuss the contract with A. A. Comeaux Youth, Inc. The motion carried
unanimously.

Councilman Plaisance asked if all requirements and provisions of the contract have been met.
Mayor Piazza was not sure if the workers compensation issue had been verified.
2
-11 introduced by Mr. Francis Plaisance and seconded by Mr. Carbett Duhon to authorize the
Mayor and the City Attorney to find out if all requirements and provisions have been met to
comply with the contract by A. A. Comeaux Youth, Inc. and if they have not been met to
authorize the Mayor to call a special meeting of the City Council to proceed with eviction of
A. A. Comeaux Youth, Inc. The motion carried unanimously.

Plaisance/Landry
Resolution R09-01

A resolution requesting the citizens of Abbeville, Louisiana sign the T. Boone Pickens’ Energy
Independence Plan Pledge and encouraging everyone to support the plan.

The motion carried unanimously.

Councilman Plaisance began a discussion on the purchasing policy. We have a policy in


place and should instruct all department heads to support it. Mr. Funderburk stated he
reviewed the ordinance we currently have on our books regarding purchasing. Since we no
longer have a purchasing and property department and the purchase orders are being issued
by the Accounting Specialist we would need to revise that part of ordinance. This will not
change the intent of the ordinance but will identify the proper employee that has that duty
This would be prepared and discussed at the next committee meeting on February 3, 2009.
Mayor Piazza also asked that the Police Chief be added as someone who can approve
purchases. Councilman Plaisance added that by following the ordinance we will prevent
unnecessary spending or unknown spending. Mayor Piazza stated the Street Department has
been notified that they may not purchase anything over $100.00 without prior approval.
Councilman Plaisance reiterated that all invoices from concrete contractors be properly
documented to show clarity of work. We need a proper invoice with details. Councilman
Plaisance added we do not want another bill for $800.00 to lay 22 bricks. Mr. Menard also
stated he follows up to check work to be sure the job is completely finished according to the
City’s specifications prior to them being paid. They cannot get paid until the job and cleanup
are complete.

-12 introduced by Mr. Joe Hardy and seconded by Mr. Carbett Duhon to ratify and approve
payments to concrete contractors over the $3,000.00 monthly cap as they have done a lot of
work that was lagging behind for several months. The motion carried unanimously.

-13 introduced by Mr. Francis Plaisance and seconded by Mr. Carbett Duhon to appoint Ted
Luquette and Gayla Falcon to the Abbeville Film and Visitors Commission. The motion
carried unanimously.

Mr. Ike Funderburk discussed The G Spot liquor permit. Late this afternoon, Mr. Funderburk
had received a document from Ms. Jillian Bessard. The document stated Mr. Gregory
Bessard had donated 50% of his legal interest (which is 50%) in the club but later in the
agreement it states Ms. Bessard owns 100% of the club and that the agreement would be
renegotiated bi-yearly. If this is a community property agreement, Ms. Bessard would own
this interest forever; it would not be open to be renegotiation. We could overlook the first
problem as it is understood that Ms. Bessard would own 100% of the club but the second item
is a problem. We cannot grant a permanent liquor permit with this document. Mr.
Funderburk advised Ms. Bessard to consult with an attorney to draft the proper document.

Bids were received and opened for a 2009 model cab and chassis 4x2 to be compatible with
bucket utility body and a new hydraulic articulating aerial device. One bid was received for
the cab and chassis from Frenzel Motors in the amount of $63,564.37 with a 60 day delivery.
One bid was received for the hydraulic articulating aerial device from Altec in the amount of
$108,663.00 with a 270-300 day delivery.

-14 introduced by Mr. Carbett Duhon and seconded by Mr. Wayne Landry to approve and
accept the bids as presented above pending a verification of all specifications. The motion
carried unanimously.

Mr. Clay Menard began a discussion on work order procedures. A work order report is
prepared and delivered every Monday to the Mayor and Council Members. The report is
detailed by district explaining all outstanding work orders for that week. The Electrical and
3
Utility Maintenance Department put in written work orders to the Street Department as
needed so there is a paper trail. Councilman Plaisance complimented Clay Menard, the
Department Heads and the Mayor on the work they are doing to complete these work orders.
Mayor Piazza added that 60% to 70% of lagging work has been completed. There are
problems with washouts especially in District B. These are not small projects. They are huge
jobs that may take us weeks to fix. We need to have the Police Juror in those respective
districts participate in the repairs of these washouts. The total burden would not always be
on the City and the Police Jury needs to live up to their part of the bargain too. Councilman
Hardy stated Council Members should contact their police jurors.

- 15 introduced by Mr. Francis Plaisance and seconded by Mr. Carbett Duhon to enter into
executive session to discuss pending litigation. The motion carried unanimously.

-16 introduced by Mr. Carbett Duhon and seconded by Mr. Francis Plaisance to reconvene the
regular session from executive session. The motion carried unanimously.

Mr. Ricky LaFleur presented a report of the executive session. The litigation involving the
Fredericks and Brian Bourque was discussed. The primary party has filed for bankruptcy so
that debt would be uncollectible and with regards to the secondary party, Mr. LaFleur stated
he is not optimistic that the City would be successful in pursuing this avenue for collection.
Being that the City is pro-business, Mr. LaFleur recommends dispensing with the litigation.

-17 introduced by Mr. Joe Hardy and seconded by Mr. Wayne Landry to contact the opposing
counsel to dispense with the litigation. The motion carried unanimously.

Richard Primeaux, engineer


- we were able to get a contact name for the person with AT&T here so we should be
able to finally get someone here to have the line moved on Guegnon Street.

-17 introduced by Mr. Joe Hardy and seconded by Mr. Wayne Landry to deviate from the
agenda to authorize advertisement for bids for the Mount Carmel Pump Station. The motion
carried unanimously.

-18 introduced by Mr. Joe Hardy and seconded by Mr. Francis Plaisance to authorize
advertisement for bids for the Mount Carmel Pump Station. The motion carried unanimously.

Ike Funderburk, Attorney


- thanked everyone for their prayers and concerns after his surgery, it is good to be
back.

Mayor Piazza requested a motion to deviate from the agenda to discuss the City Prosecutors
responsibilities. No one moved to make the requested motion.

Mayor Mark Piazza


- read aloud a letter received from CLECO. It was a termination of power supply
agreement between the City and CLECO. Effective December 31, 2010, CLECO is
terminating their contract with the City to provide power. We will need to start
negotiating a contract well in advance of this deadline.

Clay Menard, Public Works Director


- discussed the work being done at Theriot Field. The field will be very nice.

Fire Chief Elvin Michaud, Jr.


- Fire Substation #2 was retested and it was negative for mold. The shower is leaking
at Sub #2 so that will be changed out too. Substation 1 and 3 ducts were cleaned
today and the Main will be cleaned tomorrow.

Councilman Wayne Landry


- thanked Richard Primeaux and Clay Menard for their work to contact AT&T.

4
There being no further business to discuss, Mayor Piazza declared this meeting adjourned.

ATTEST: APPROVE:

Kathleen S. Faulk Mark Piazza


Secretary-Treasurer Mayor

5
Exhibit L (Prepared by Cleco Power staff)

St. Martinville (STM)/ Alexandria (AEX) Contract Comparison

Contract Provisions STM AEX


Term 5 years 13 years

Peak Load 15 MW 180 MW


Supplemental to 55 MW
LEPA and 11 MW SWPA
Service Obligation Entire load
supply, with stand-by
capacity for entire load
Demand Charge $7.96/kw $10.40/kw

Renewable Mandate Costs Pass-through Option to self supply

Rollover of Transmission Rights No Yes

Credit for Ancillary Services No Yes

Credit for Generation No Yes (Hunter)

Reason for Demand Charge difference:

The unit rate for the demand charge is higher under the AEX contract due to Cleco's requirement to
serve the most expensive, load-following part of the demand curve. With STM, Cleco serves the entire
demand curve, including the less costly baseload portion. Although Cleco serves only AEX's
supplemental load which cannot be supplied from LEPA and SWPA, it still must have capacity standing
by in the event AEX's baseload generation fails. This stand-by service is included in AEX's $10.40/kw
demand charge which is levied only on the supplemental load.

In other words, AEX pays a higher unit rate charged against a relatively smaller portion of its total
demand. If AEX were to receive the STM rate but not get a credit for the LEPA Capacity and the
SWPA Capacity, then AEX would pay a greater total demand charge than under the proposed contract
(114,000 kw* X 10.40= $1,185,600 vs. 180,000 X 7.96= $1,432,800). AEX and STM pay different unit
rates for the demand charge because they have different service needs. AEX has low-cost baseload
generation; STM has none.

*114,000 = 180,000 – (55,000 + 11,000)