Tom O'Farrell

The committee reviewed the 2025 financial audit results presented by Baker Tilly US, LLP, which resulted in unmodified opinions for CMEEC and Transco financial statements, alongside one significant deficiency noted in internal controls. Discussions included GASB Statement 84, the restatement of fiduciary activities, and the future detailed explanation of movement for specific funds. The committee moved to recommend acceptance of the 2025 audited financial statements to the Board of Directors. Additionally, the committee received an educational presentation on the project allocation process for expenses, revenues, and avoided costs, agreeing to focus the internal audit on complex, multi-cost center allocations. Finally, it was confirmed that there were no exceptions to the Travel, Events, and Retreats Policy or related party transactions.

The meeting included a presentation on projected load forecasts over the next decade and the impact on grid reliability, as well as a discussion regarding reactive power and load power factors in relation to the transmission system. The Audit Committee presented results of the 2025 financial audit, noting unmodified opinions and internal control recommendations, which were subsequently accepted by the Board. The Governance Committee reported on its charter revisions, which were approved, and discussed future compensation policy goals. Additionally, the Board reviewed monthly performance metrics, energy market analysis, and project portfolio summaries, including performance updates for microgeneration, energy storage, and fuel cell projects. Member representatives provided updates on municipal utility rate adjustments and equipment procurement.

The committee discussed and recommended the adoption of the amended Ad Hoc CEO Performance and Compensation Committee Charter, focusing on revisions to the member onboarding process. Additionally, the committee held an executive session to discuss CEO performance survey results and reviewed the next steps in the annual CEO review process, including the scheduling of future meetings to address compensation adjustments and performance goals.

The Joint Board meeting commenced with the approval of the minutes from the December 18, 2025 meeting. Key agenda items included an overview of the 2026 Connecticut State Legislative Session by outside counsel, and a summary of CMEEC's January 2026 operational metrics, which showed Member Power Cost 53% above budget due to market volatility and higher ancillary services charges. The January Energy Market Update detailed extreme volatility in LMPs and ancillary services charges being 488% above budget. The Project Portfolio Summary addressed performance for several projects, including MicroGen, Transmission Project #1, Hydro Quebec, Energy Storage, and the Subase Fuel Cell project. Committee reports were presented, resulting in the approval of amended Charters for the Audit Committee, Budget & Finance Committee, and Risk Management Committee. The Board also authorized CMEEC staff to pursue third-party customers for the CAARS service offering under FERC Order 881. Discussions also covered the continuation of Ad Hoc Charter Review Committee efforts, the re-establishment of the Ad Hoc CEO Compensation Committee for the 2025 performance review, and a discussion regarding the 2025 Board Self-Assessment results.

The committee held a meeting to select a 2026 Governance Committee Chair and review the results of the 2025 Governance Committee Self-Assessment. Discussions were held regarding goals for 2026, including establishing compensation policies for board members and surveying the board on training topics. Additionally, the committee reviewed the new committee member onboarding process and discussed proposed revisions to the Governance Committee Charter, ultimately recommending the adoption of the amended charter to the Board of Directors.