CONTRA COSTA WATER DISTRICT

BOARD OF DIRECTORS

REGULAR MEETING

November 14, 2007

 

MINUTES

 

 

CALL TO ORDER 

 

President Campbell called to order a regular meeting of the Board of Directors of the Contra Costa Water District at 6:30 p.m., at 1331 Concord Avenue, Concord, the regular meeting place of the Board.

 

ROLL CALL

 

            Directors Present:                      Joseph L. Campbell, President

                                                            Elizabeth R. Anello, Vice President

                                                            John A. Burgh

                                                            Bette Boatmun

                                                            Karl L. Wandry

            General Manager:                       Walter J. Bishop

            Legal Counsel:                           Robert B. Maddow

            District Secretary:                      Sharon L. Burris

 

PLEDGE OF ALLEGIANCE

 

Director of Operations and Maintenance Michael Holley led the Pledge of Allegiance. 

 

ADOPTION OF AGENDA

 

Mr. Bishop advised that there were no changes to the agenda. 

 

PUBLIC COMMENT

 

President Campbell asked if there were any public comments.  There were no public comments.

 

CONSENT

 

1.         Approve Directors’ Services/Business and Travel Expenses

            a.   Future Services – November

            b.   Compensation – October

 

2.         Approve the minutes of October 17, 2007. 

           

3.         Approve the warrant register dated November 15, 2007.

 

4.         Authorize revision of FY08 budget revenue estimate for interest income from $6.8 million to $11.0 million to align with current market conditions and investment performance.

 

5.         Authorize execution of agreement with Union Bank of California for Government Accounting Standards Board (GASB) Statement 45 trustee and investment management services for a three-year period with the option to renew for two additional years based on a fee of 0.83% applied to the market value of the assets under management. 

 

6.         Authorize the purchase of a total of 13 replacement and new vehicles from the vendors listed on the bid and cost summary at the indicted units and prices for a total combined purchase not-to-exceed amount of $280,853, including sales tax.

 

President Campbell commented on Agenda Item No. 1.b. Compensation – October.   He noted that the District was a member of the Special Districts Association and participates in the association activities.  He opined that director participation should be in matters that pertain to the policy, direction, and areas of interest to the District. 

 

MOTION:  Boatmun/Wandry to approve the consent calendar.  The motion carried by a unanimous voice vote. 

 

ACTION

 

7.         Accept the FY07 audited financial statements.

 

Mr. Bishop reported that the District had received the highest possible rating from the auditors, Maze and Associates.  The audit results and draft financial statements were reviewed by the Finance Committee on October 26.   At Mr. Bishop’s request, Director of Finance Brice Bledsoe introduced auditor Tim Krisch, from Maze and Associates.  Mr. Bledsoe noted that Mr. Krisch was available to answer questions from the Board.  There were no questions from the Board.

 

President Campbell welcomed Mr. Krisch to the Board meeting. 

 

Director Boatmun commented that she was pleased that there were no exceptions to the report.  Director Burgh commended staff on the clean audit and the checks and balances in place at the District. 

 

President Campbell asked if anyone from the public would like to speak to the item.  There were no comments.    

 

MOTION:  Wandry/Anello to accept the FY07 audited financial statements.  The motion carried by a unanimous voice vote. 

8.         Authorization for Emergency Transmission Main Repair – South Pleasant Hill Main Replacement

            a.   Authorize an increase of $75,000 for the construction contract with JMB Construction Inc. for the South Pleasant Hill Main Replacement Project for a revised total authorization not to exceed $1,385,609;

            b.   Authorize a $100,000 budget transfer from the FY08 Operating Contingency budget to the FY08 Construction Department Services budget; and

            c.   Authorize the General Manager to enter into a competitively bid paving repairs contract for a total authorization not to exceed $100,000. 

 

Mr. Bishop reported that the District had experienced a water main break on a 30-inch water pipeline adjacent to a District contractor’s work area on Contra Costa Boulevard in the City of Pleasant Hill (City).  The water from the main break had damaged the contractor’s work area and the pavement along a portion of Contra Costa Boulevard.  He advised that based on the severity of the damages, additional funding was needed. 

 

Mr. Bishop advised that District staff had responded in a very responsible manner, the site had been restored, and a 30-inch valve had been placed in the area of the break.  He reported that the pipeline was repaired and back in service, and all impacted customers were back to normal water service.  Immediate repairs to the contractor’s work area and interim pavement repairs would need to be completed.  He noted that the City would be requesting permanent repairs to the road and that the District would need to be prepared to act quickly.   

 

Responding to a question from Director Boatmun concerning when the waterline was installed, Mr. Bishop replied that it was installed during 1974.

 

Vice President Anello commended staff on keeping the Directors informed on progress during the main break. 

 

Director Burgh stated that he had received two comments on the main break and both comments dealt with traffic issues.  He commented positively on the way this very serious event was handled.  He was pleased to see that District staff responded quickly and effectively.  He also commended public information on keeping him updated on the progress. 

 

President Campbell commented on the efficiency with which this main break was handled.  He commended District staff on their responsiveness and the noted that the lack of negative comments was an indication that the District had gained the public’s confidence. 

 

MOTION:  Boatmun/Anello to a) authorize an increase of $75,000 for the construction contract with JMB Construction Inc. for the South Pleasant Hill Main Replacement Project for a revised total authorization not to exceed $1,385,609; b) authorize a $100,000 budget transfer from the FY08 Operating Contingency budget to the FY08 Construction Department Services budget; and

c) authorize the General Manager to enter into a competitively bid paving repairs contract for a total authorization not to exceed $100,000.  The motion carried by a unanimous voice vote.  

DISCUSSION AND INFORMATION

 

9.         Review and concur with the assumptions for the 2008 rate analysis including the option of a phase in over two years of the 95% Facility Reserve Charge calculated value. 

 

Mr. Bishop advised that the item was before the Board for review and concurrence.  A public hearing would be held on January 16, 2008 and pending the outcome, the Board could also consider adoption of water rates, fees and charges at that meeting.  He reported that there was a policy issue being considered in the 2008 rate analysis for the Facility Reserve Charges (FRCs) subsidy.  He advised that staff had met with the representatives from the development community, cities, and other public agencies concerning a proposed increase for the FRCs. 

 

Mr. Bledsoe presented the 2008 rate analysis assumptions for the Board’s review.  He advised that the 2008 rate analysis was presented to the Finance Committee on October 26, 2007.  He identified the significant changes from the 2008-2017 Capital Improvement Program (CIP).  The first change was a policy issue change concerning the FRC subsidy.  He identified the second change as a higher beginning reserve balance, which increased the revenue target for interest earnings to 5%.  The Series O debt service refunding completed in July 2007 was the third change.  This refunding generated approximately $2.7 million of debt service savings which will occur in FY08 and FY09.    

 

Mr. Bledsoe reviewed the District’s current FRC methodology, which was established at 90% of calculated value.  He also reviewed background information concerning the Treated Water Master Plan and the Future Water Supply Study and how they impact the FRC fees.  He reminded the Board that at the September 5, 2007 Board meeting that they had directed staff to develop two alternatives to reduce or eliminate the FRC subsidy.  He identified the first alternative as to move to 95% of the calculated value phased in over a two-year period.  The second alternative was 100% of the calculated value phased in over a three-year period.  He reviewed the fiscal impact for treated and untreated water alternatives.  He noted that staff was recommending Alternative No. 1, which was 95% of the calculated value phased in over a two-year period. 

 

President Campbell asked if the Finance Committee concurred with the recommendation.  Mr. Bishop responded, yes.  He also advised that the preference of the stakeholder group was Alternative No. 1. 

 

Mr. Bledsoe advised that other key assumptions for the 2008 rate analysis include high beginning reserve balances totaling $6.4 million. Capital spending was consistent with the CIP and reflected FY08 capital project re-budgets.  He reviewed the schedule and noted that the public hearing on proposed adjustments would be held on January 16, 2008.  Pending Board adoption of the proposed adjustments, the changes would become effective February 1, 2008.  The FRC adjustments required a 60-day notification period and would become effective April 1, 2008. 

 

President Campbell asked if anyone in there were any public comments concerning the item.  There were no comments. 

 

It was the consensus of the Board that they concurred with the assumptions for the 2008 rate analysis including the option of a phase in over two years of the 95% Facility Reserve Charge calculated value. 

 

REPORTS FOR DISCUSSION

 

10.        Committee Report(s)

            a.   Public Information and Conservation Committee Post-Meeting Report (10/16/07)

            b.   Finance Committee Post-Meeting Report (10/26/07)

 

Director Burgh commented that he would like the Board to consider additional funding for the R.V. Brownlee program, which would enable more students to participate in the program.  He would like contingencies built into the District’s support for the program.  This would allow the number of voyages to remain the same regardless of contributions from partner agencies.

 

President Campbell asked if Director Burgh was asking if this be an item for consideration when the Board reviewed the budget again.  Director Burgh responded, yes. 

 

Director Wandry asked how many trips were being reduced.  Mr. Bishop advised that the District was setting records and more trips were being provided than there were three years ago. 

 

11.        Schedule Future Meeting Dates and Times

 

Mr. Bishop reminded the Board that the Employee Holiday Luncheon would be held on December 12, at Concord Centre.  He also advised that a Holiday reception would be held after the Board meeting on December 19. 

 

REPORTS

 

12.        General Manager

 

Mr. Bishop gave a brief update on the legislative special session in Sacramento concerning water bills.  He advised that Assistant General Manager of Planning/Delta Projects Greg Gartrell would be articulating the District’s position at the Bay Delta Conservation Plan meeting being held on November 16, in Sacramento. 

 

13.        Legal Counsel

 

Mr. Maddow did not have a report. 

 

14.        Board Members

 

Director Boatmun reported that she attended the Sanitation and Water Agency meeting on November 8, at the Antioch Water Treatment Plant.  She also commented positively on District employees enrolled in water treatment classes being taught by Solano County Community College professors.  She noted that the classes were being held at Central Contra Costa Sanitary District.  Mr. Bishop advised that the District was one of the financial sponsors of the program. 

 

Vice President Anello advised that she would be attending the Watershed Symposium on November 15 in Walnut Creek.   

 

Director Wandry advised that he also was considering attending the Watershed Symposium.

 

Director Burgh commented on Boardmember travel and expense reimbursement policies. 

 

President Campbell did not have a report. 

 

CLOSED SESSION

 

15.        Conference with Labor Negotiator as allowed under Government Code 54957.6;

            Agency Negotiator:  Walter J. Bishop; Employee Organizations:  Local 21 and Local 39; Issue:  Instruct Negotiator

 

 

At 7:10 p.m., President Campbell announced that the Board would move into closed session.  There was one matter before the Board concerning labor negotiations.  The additional attendees would include Director of Operations and Maintenance Michael Holley and Assistant General Manager of Administration Kurt Ladensack. 

           

 RECONVENE FROM CLOSED SESSION

 

16.        Report on closed session.

 

At 7:42 p.m., President Campbell reconvened the meeting and announced that the Board did not take any action on the matter before it. 

 

ADJOURNMENT

 

At 7:43 p.m., President Campbell adjourned the meeting to the next regular meeting of the Board of Directors scheduled for December 5, 2007, commenting at 6:30 p.m.

 

 

 

 

                                                                                                                                                        

                                                                                                Joseph L. Campbell, President

ATTEST:

 

                                               

Sharon L. Burris

District Secretary