INFORMATION AND RECORDS MANAGEMENT ORIENTATION ON THE RECORD! INFORMATION AND RECORDS MANAGEMENT ORIENTATION Tom Varljen Legal Department 4/30/2009

PROGRAM CONTEXT Expanding Regulatory Agency Record Retention Compliance Requirements Transition From Paper to Electronic Media E-Discovery – A New Dimension in Litigation Fines and Penalties for Under-Retention and Over-Retention Enterprise Business Continuity Data Security and Portability Issues

FERC RECORDS RETENTION REQUIREMENTS FOR UTILITIES Mandatory Minimum Retention Periods for Covered Records Must Protect Records: Fire, Flood, Etc. Must Designate Supervisory Official for Records Must Index to Facilitate Retrieval and Audit Option for Utility to Select Preferred Storage Media Must Suspend Record Destruction Subject to Legal Holds

UNINTENDED CONSEQUENCES UNDER-RETENTION Fines & Penalties Court Sanctions Poor Defense Position OVER-RETENTION Conflicting Documents Memory Fades With Time “Smoking Gun” Opportunity Increases Burden of Production Cost of Storage/Floor Space

RECORDS MANAGEMENT PROGRAM OBJECTIVES Regulatory and Legal Compliance Preservation and Backup of Vital Records Enhanced Business Operations Confidential Information Protection Support Litigation Response or Governmental Agency Audits Communicate Responsible Record Creation Practices

INFORMATION AND RECORDS MANAGEMENT PROGRAM

RECORDS AND NON-RECORDS Off-Site Backup for Business Continuity Retention Mandated by Regulation or legal/commercial/ Operational Value Everything Else

“OFFICIAL BUSINESS” RECORD The single original or copy of a paper or electronic record for which: Retention is Mandated by Statute or Government Regulations (FERC, IRS, DOT, OSHA, WUTC, etc.) The Record has Legal or Evidentiary Value The Record is Required for Commercial or Operational Purposes (policies, procedures, business continuity, training, creation of official reports and filings, etc.) The Record has Institutional or Historical value

OFFICIAL BUSINESS RECORDS MUST BE: Identified Assigned to a Coordinator/Custodian Given a Retention Duration Kept in a Secure Repository Indexed: What/Who/Where/When

LIFE CYCLE OF BUSINESS RECORDS Creation/Receipt/Identification Final Disposition Destroy by Shredding (or Keep “Forever”) Active Files -High Value and Use -Office Repositories -Limited Access Semi-Active/Inactive Archive -Remainder of Retention Period -Secure Off-site Facility -Business Continuity Retrieval

RECORDS RETENTION REQUIREMENTS FOR UTILITY PLANT RETAIN FOR THE LIFE OF THE PLANT PLUS SIX YEARS: Engineering Records of Proposed or As-Constructed Utility Facilities Contracts Related to Services Performed in Connection With Construction of Utility Plant Associated Financial Records

VITAL RECORD A Record Required to Resume or Continue Operations During or After an Emergency or Disaster Must be Backed up at a Secure Off-Site Location Exception to the Rule that Records Not Exist in Duplicate Versions

NON-RECORD MATERIALS Duplicate or Convenience Copies of Records – Dispose of after its business need ends Working Papers and Preliminary Drafts or Red-Lines – Dispose of after the final version is submitted. Copies of Materials Published or Issued by Others and Publically Available (Codes, Standards, Regulations, etc.) – Dispose of if On-line or Store Electronically for Reference Paper Copies of Records Stored on Electronic Media – Destroy ASAP or Don’t Make a Paper Copy in the First Place

DISCOVERABLE RECORDS Official Business Records Non-Record Materials Anything You Generate Related to Your Job at Avista (paper, electronic and photo media): Diaries, Calendars, Sticky Notes, Emails, Voicemails, Recorded Calls, Instant Messages, Text Messages, Word Documents, etc.

RECORDS AND INFORMATION PRESERVATION (“RIP”) NOTICE Issued by the Legal Department Related to Current or Anticipated Litigation, Audit or Governmental Investigation Suspends Destruction or Purging of Affected Records and Non-Records Destruction Cannot Commence until Records are Released by Legal Department

SPOLIATION IS AGAINST THE LAW AND COMPANY POLICY Spoliation is the Intentional and Unlawful Destruction, Alteration or Concealment of Evidence or Materials (Includes Records and Non-Records): Subject to an RIP Notice or Subpoena In Anticipation of and Related to an Audit, Investigation or Litigation

INFORMATION AND RECORDS ACCESS CONTROL Attorney-Client Privilege Attorney Work Product Critical Energy Infrastructure Information Legal Hold (Subject to RIP Notice) Avista Proprietary or Confidential Customer Private Information Employee Private Information Other Party Proprietary Information

GOOD RECORDS MANAGEMENT PRACTICES Retain Records/Non-Records According to the Corporate Retention Policy Don’t Keep Record Copies in Personal Files Use the On-Site Group Record Repositories or Off-Site Archives or Go Electronic Don’t Retain Docs after their Useful Life or Mandated Retention Period has Expired Shred Docs that Contain Sensitive Information Have an Annual Clean-up Day for Your Personal Files

GOOD RECORDS CREATION PRACTICES Conform with Avista’s Code of Conduct and Ethics Stick to the Facts Do Not Speculate or Make Admissions Do Not Provide Personal Opinions Unless Qualified Do Not Present Rumor or Hearsay Do not Falsify Records Be Accurate and Professional

PROGRAM ORGANIZATION AND RESPONSIBILITIES Executive Sponsor – Marian Durkin Supply Chain Dept – Kathy Nitteberg – Implement RM Procedures and the Record Center IS/IT – Apply Retention Guidelines to Electronic Records Legal – Maintain the Policy, Provide Guidance Directors/Department Managers – Assign Functional Records Management Responsibilities For Their Org’s Records

RECORDS MANAGEMENT IMPLEMENTATION AT AVISTA WILL CONTINUE TO BE DECENTRALIZED Directors/Department Managers Have Been Asked to Assign Functional Records Management Responsibilities Within their Organization

WORKING LEVEL RECORDS MANAGEMENT EXPECTATIONS Record/Non-Record Decision Process Retention Period Decision Process “Official Repository” Specified for Records Custodial Responsibility Assigned Record Index Maintained to Support Retrieval and Audit Timely Disposition of Non-Record Baggage

APPROVED REPOSITORIES FOR OFFICIAL BUSINESS RECORDS Department/Function Central Files –Locked if Necessary Off-site Secure Archive for Paper Records Off-site Electronic Records Backup/Archive Password-Protected Servers Government/Regulatory/Public Electronic Records Center (We don’t have to keep copies if these are available for access)

DEPARTMENT/FUNCTION RECORDS COORDINATOR “Go-To” Person in the Group for Records Management Questions Establish Group Procedures for Managing Official Records Generated by the Group See That a FERC-Compliant Index of the Group’s Official Records is maintained Represent the Group on the Company’s IRM Council

GOOD RECORD KEEPING IS GOOD BUSINESS!!!

ACCESSING INFORMATION AND RECORDS MANAGEMENT PROGRAM DOCUMENTS VIA AVANET Go to the AVANET home page. On the right side panel click in the box labeled Code of Conduct, Ethics and Compliance. This link takes you to the Compliance Issues page. Click on the last item listed, namely the Information and Records Management Program link. This takes you to a page containing the links for the Policy, Guidelines Manual and the Records Retention and Destruction Schedules.