MEETING MINUTES
Forestry, Fire, and State Lands Conference Room
April 6, 2007
8:30 a.m. – 12 p.m.

Attendance

Board Members:

• Geoffrey Bedell
• David Simon
• Stephen Church
• Jack Hamilton
• Kenneth Puchlick
• Mark Bunnell
• Alisa Schofield – Excused
• Ex Offico: Tom Faddis

Staff:

• Richard Allis
• Kimm Harty
• John Kingsley
• Jo Lynn Campbell
• Grant Willis
• Phil Powlick

Chair Bedell called the meeting to order and welcomed everyone.

APPROVAL OF MINUTES
Chair Bedell asked for motion of the last meetings minutes. David Simon suggested removing the word conflict from the subheading ‘UGS Services’. Stephen Church motioned to approve the minutes with the noted change. David Simon made a second. All were in favor.

DIRECTOR’S REPORT
Financial Position

The UGS finances are healthy.

On the expenditure side, the UGS is tracking slightly under budget, with 59% of budget expenditure at the 8 month (67%) point of the year. The year-end adjustments in personnel costs for partial pay periods at the start and end of the year mean the true under-expenditure is likely to be about half the apparent difference at the moment. The main cause of under-expenditure is pass-through funding which is only 37% spent. Sub-contracts will catch up to budget at the year-end when deliverables are due.

On the revenue side of the budget, the two components that can vary through the year are billable contract work, and Mineral Lease revenue. Contracts amount to $1.95 million or 27% of total annual revenue, and were 47% billed at mid-point of the year. UGS expects to be close to full contract revenue by the end of the financial year. Mineral Lease revenue was projected to be at 75% of last year’s revenue when the budget was compiled at the beginning of this FY. Based on projected revenue and expenditure patterns our year-end Mineral Lease carry-forward will be several hundred thousand dollars above the originally budgeted $300k. Our carry-forward at the start of the FY was $727k.

Contracts and Grants
Contracts and grants have remained stable. The trend for the UGS is complicated with the addition of the SEP two years ago when the Energy office was split up. This added to the UGS budget a relatively large share of federal funding, much of which is pass-through expenditure. In the announcement of the FY07 STATEMAP allocations, UGS was ranked as the best and won the greatest funding allocation of $246k. In DOE, both the Fossil Energy program and the Geothermal program are threatened with closure, with increases in funding going to clean coal technologies, alternative fuel research (biomass conversion) and carbon dioxide sequestration.

Personnel
Things have been stable other than with GIS positions. We are addressing the problem on several fronts. Some programs are hiring geologists with a GIS background. In the future we will have on board only 2-3 specialist GIS staff to support the geologists. We have made an offer to a geologist for the GIO program and are waiting to see if the offer is accepted.

Legislative Update
HB 134 creates the Land Exchange Distribution Account that distributes the state’s share of mineral revenues from School and Institutional Trust Lands Administration (SITLA) to the counties from which the revenue is generated and to various entities, including the UGS. The bill designates how the state’s share of mineral revenues “exchange lands funds” from SITLA land are to be used and eliminates the contributions to the Mineral Lease Account. This bill also reallocates for two years (FY 2008 and 2009), 7.5% of SITLA exchange lands funds to the UGS to be used to drill deep monitoring wells in the West Desert as part of the Snake Valley ground-water project.

The UGS will receive a one-time allocation of $1.4 million to help fund the West Desert well-drilling project. The legislature approved the Governor’s request for a 3.5% COLA for state employees. The governor also requested a 2.5% increment for “hot spot” compensations issues, and the legislature ended up finding this at the 1.5% level. The criteria for disbursing the 1.5% “hot spot” salary support are still being worked on with DNR Executive.

Utah Core Research Center Upgrade
Last year the Board considered ideas for enhancing the services offered by the Utah Core Research Center (UCRC). One issue was the inadequate space to hold workshops for industry and researchers. The UGS met with DNR Executive to discuss options for adding space. The UGS may be able to add more space to the west (Redwood Road) side of the building. In addition, on the backside of the building, a 10’ x 20’ area may be built for additional core processing. The next stage is to involve DFCM for drawing up a plan.

Board Field Trip
Director Allis mentioned the September field trip will be in the Snake Valley/Deep Creek mountains area.

DISCUSSION ITEMS
Mapping Program Update – Grant Willis
Grant gave an overview of the history of the mapping program and projects, new and ongoing in the STATEMAP program.

UGS Planning Document
This is a five-year planning document. Director Allis gave an overview of the sections within the document. There was discussion about the section on Issues and Goals of the Geologic Hazards program, specifically whether the UGS is conducting geologic hazard reviews of subdivisions that goes beyond the scope of its mission. David Simon made a motion to add this discussion to the June board meeting agenda. Kenneth Puchlik made a second. All were in favor. The motion carried unanimously.

New Role for Board – Oversight of School Energy Efficiency Revolving Fund
Philip Powlick, SEP manager, explained the role of SEP and the responsibilities charged through SB233 regarding renewable energy tax credits. UGS is charged with certifying eligibility for tax credit applications and its board has rulemaking authority for the credits. There will be minor changes to the previous rules that applied to these credits, and the Board will be asked to approve them at its August meeting. In addition, HB 233 sets up a revolving fund of $20 million for energy efficiency improvements in schools and administered by the UGS SEP. A set of rules will be drafted by SEP to guide the process of loan application and selection. The UGS Board will need to approve these rules at its August meeting. In addition, the Board will be the final approval stage for these loans. A special loan committee will be set up by SEP to process the loan applications and make recommendations to the Board. It was recommended that one board member be on the rule-making committee to assure the whole Board that the loan selection process was carried out according to the established rules. Stephen Church nominated Jack Hamilton to represent the board on the rule-making committee. Mark Bunnell made a second. The motion carried unanimously.

ACTION
Due to the new role of the board, it was recommended that the June meeting date be changed. It was mentioned due to the creation of new rules an extra meeting may be needed. The board decided to meet on the regular June board meeting date. August 17 was agreed upon for the extra meeting for approval of the new rules.

There was suggestion to change the date of the board field trip because of conflicts for two board members. The Board agreed on September 14-15 as the new date for the board field trip.

ADJORNMENT
Chair Bedell asked for a motion to adjourn. Mark Bunnell motioned to adjourn the April 6, 2007 meeting. Stephen Church made a second. All were in favor. The meeting was adjourned at 12 p.m.