March 1, 2010
VALLEY CENTER WATER DISTRICT
Regular Board Meeting
Monday, March 1, 2010
Time: 2:00 P.M.
Place: Board Room
29300 Valley Center Road
Valley Center, CA 92082
The Valley Center Municipal Water District Board of Directors’ meeting was called to order by President Broomell at 2:00 P.M.
ROLL CALL
Board members present were: Directors Broomell, Polito, Aleshire, Stone and Haskell. Staff members present were: General Manager Arant, General Counsel Cowett, District Engineer Grabbe, Manager of Accounting Pugh, Meter Services Supervisor LoPresti, Board Secretary Stetson, Manager of IT Pilve, Project Managers Carrillo and Kilwein and Accounting Specialists Masley and Serrato. Spectators present were: Ms. Jacqueline Howells, Howells Government Relations, and Mr. Dave Ross, Valley Roadrunner Newspaper.
AUDIENCE COMMENTS/QUESTIONS
Jacqueline Howells of Howells Government Relations was introduced to the Board. Ms. Howells has been contracted to analyze and research potential District programs and provide preliminary advocacy services regarding potential Federal legislative and funding opportunities the District might pursue.
CONSENT CALENDAR
1. Upon motion by Aleshire, seconded by Stone and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held February 16, 2010
• Concept approval of the Ivy Dell Estates waterline extension (TPM 20425) consisting of approximately 790 feet of 8-inch water main, one 6-inch fire hydrant and other appurtenances
• Resolution No. 2010-09 affirming no change in the District’s authorized debt limits on the expenditure of District funds for capital improvement projects of $2,061,084 per project and $3,091,635 for the acquisition and installation of water reservoirs per Ordinance No. 171, effective as of January 1, 2010
• Resolution Nos. 2010-10, 2010-11 and 2010-12 concurring in the nominations of Joan C. Finnegan (Municipal Water District of Orange County) to the Office of President of ACWA/JPIA; Paul E. Dorey (Vista Irrigation District), and Wayne D. Nygaard (Palm Ranch Irrigation District) to the ACWA/JPIA Executive Committee
• Audit demand check numbers 124945 through 125063
ACTION AGENDA
2. Award of Contract for the Meadows Highline Project:
Project Manager Carrillo reported that bids were received and opened on February 17th for the Meadows Highline Project. This project consists of 160 LF of concrete encased 8-inch wastewater pipeline to replace 8-inch PVC line that is exposed on a rock slope. This portion of the existing line will be removed and replaced with the wastewater flow bypassed through a separate pipeline during the process. The new concrete encased wastewater line will be covered with rocks that will camouflage the pipe on the slopes.
HTA Engineering & Construction, Inc. submitted the lowest bid at $133,000. Staff noted that HTA Engineering & Construction had recently completed a project to the satisfaction of the District and adoption of Resolution No. 2010-08 for the award of contract to HTA Engineering & Construction and declaring the intent to reimburse the District from the proceeds of tax-exempt financing in the future was recommended. Due to the favorable bid received (52% under the Engineer’s estimate) for the construction of the project, a budget savings of $166,000 was estimated which will be reallocated upon completion.
Upon motion by Polito, seconded by Stone and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2010-08
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT AWARDING
THE CONTRACT FOR THE MEADOWS HIGHLINE PROJECT
AND DECLARING INTENT TO REIMBURSE CAPITAL
EXPENDITURES FROM PROCEEDS OF INDEBTEDNESS
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
3. Update on the Welk Water Reclamation Facility Feasibility Study:
District Engineer Grabbe provided an update on the preliminary studies for the Welk Water Reclamation Facility proposed project. As proposed, the water reclamation facility at the Welk development would skim water off the wastewater trunk main that traverses the golf course for treatment and application on the golf course to offset the potable water demands. The proposed improvements are a diversion structure, 125,000 gpd water reclamation facility, recycled water distribution system and golf course retrofit.
Benefits of the proposed Welk water reclamation project are the local water supply source offset for 275 EDUs, and wastewater capacity for 625 EDUs. Estimated costs are $4.3 million for the capital improvements and an annual operation & maintenance cost of $200,000. Potential funding sources for the capital costs were reviewed, as follows:
Water demand offset charge only – 275 EDUs at $15,650/EDU
Wastewater capacity fee only – 625 EDUs at $6,880/EDU (combined water and wastewater would be 900 EDUs at $4,800/EDU
MWD’s Local Resources Program – Up to $250/ac. ft. per year
SDCWA Local Water Supply Development Program - $200/ac. ft. per year
State Revolving Fund (SRF) loan – Has a 16.7% matching funds requirement
Federal funding - 75% matching funds component
Funding of the project for a specific development could be through the formation of an assessment district. The project’s construction costs exceed the District’s spending limitation of $2,061,084 per project. Therefore, a District-wide vote approving expenditure of the funds would be necessary to pursue the project as a District local water supply capital improvement project. Operations and Maintenance funding sources include the sale of recycled water and a wastewater service charge.
District Engineer Grabbe reviewed that no action by the Board on the proposed Welk Water Reclamation Facility Feasibility Study is needed at this time and recommended pursuing funding source approvals including considering obtaining voter authorization per the District’s Ordinance No. 171, the spending limitation ordinance, as well as evaluate other local water supply projects.
Jacqueline Howells of Howells Government Relations addressed the Board concerning potential Federal funding sources for projects. Ms. Howell stated that she has reviewed potential District projects with staff and that several projects may be eligible for Title 16 Water Reclamation Project funding administered by the U.S. Bureau of Reclamation. She explained that it can be advantageous to combine the proposed reclamation projects in an application package as that would qualify for the 25% federal match and it would streamline the appropriation request of Congress. Ms. Howell noted that application for Title 16 funds is a competitive process and the advocacy services of Howells Government Relations will improve the District’s prospects of successfully obtaining federal funding. The process to seek Title 16 federal funding is to get legislation adopted authorizing the project and then applying for an appropriation. Ms. Howell will present to the Board an analysis of potential District projects and federal funding sources that could be pursued at the Board meeting of April 5, 2010.
4. Resolution Supporting the “Safe, Clean and Reliable Drinking Water Supply Act of 2010”:
As part of the State’s water policy legislation recently adopted, the “Safe, Clean and Reliable Drinking Water Supply Act of 2010” will be on the November ballot. If approved by the voters, this bond will provide $11.4 billion for:
▪ Drought Relief - $455 million
▪ Water Supply Reliability - $1.4 billion
▪ Delta Sustainability - $2.25 billion
▪ Groundwater Cleanup and Protection - $1 billion
▪ Storage and Statewide Water System Improvements - $3.0 billion
▪ Water Recycling and Conservation - $1.25 billion
▪ Conservation and Watershed Protection - $1.79 billion
General Manager Arant stated that the $856 million for water supply reliability will benefit San Diego County as well as the allocated share of $6.38 billion in other regional and state-wide funding categories provided for in the bond. Funds specified for water supply reliability projects in San Diego County may offset a portion of the $550 million San Vicente Reservoir Carry-over Storage Dam Raise Project that will be beneficial to member agencies of the San Diego County Water Authority. In recognition of the current economic conditions and the State’s budget deficit, a survey of voters will be conducted to gauge the voters’ position on this bond and to determine if it would be more advantageous to defer placing the bond on the ballot.
Upon motion by Aleshire, seconded by Polito and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2010-13
A RESOLUTION OF THE BOARD OF DIRECTORS
OF VALLEY CENTER MUNICIPAL WATER DISTRICT
IN SUPPORT OF THE SAFE, CLEAN AND
RELIABLE DRINKING WATER SUPPLY ACT OF 2010
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
5. Resolution to Set the Hearing Date and Schedule of Assessments for a Public Hearing to Consider the Levy of the District-Wide Water Availability Charge for Fiscal Year 2010-11:
Resolution No. 2010-07 was presented for the Board’s consideration to set June 7, 2010, at 2:00 p.m. as the date and time for the public hearing to consider levying the proposed Fiscal Year 2010-11 District-wide water availability charge. The proposed $10.00/acre, $10.00/parcel minimum water availability charge, which has been levied since 1995-96, is expected to be used for:
Revenue Debt Service $103,886
Ongoing Capital Requirements 487,114
Total Water Availability Charge $591,000
A Notice of the Public Hearing on the proposed District-wide water availability charge will be published in the newspaper and property owners who changed ownership since the levy of the availability charge for 2009-10 will receive written notification.
Manager of Accounting Pugh noted that a public hearing will also be conducted at the June 7th Board meeting on the assessment of the Woods Valley Sewer Service Charge which is collected on the tax roll. A Notice of this public hearing will be published in the newspaper.
Upon motion by Polito, seconded by Haskell and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2010-07
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT SETTING
FORTH A SCHEDULE OF WATER AVAILABILITY CHARGES
PROPOSED TO BE ESTABLISHED FOR ALL PROPERTY
WITHIN THE DISTRICT FOR 2010-11, FIXING THE TIME
AND PLACE OF HEARING AND GIVING NOTICE OF HEARING
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
GENERAL MANAGER’S AGENDA
6. Review of Miscellaneous Informational Items:
• The San Diego County Water Authority is working to amend the Quantification Settlement Agreement (QSA) following the judge’s ruling to invalidate the QSA based on the State’s obligation for an unlimited and unconstrained monetary commitment for the restoration of the Salton Sea which violates the State’s Constitution.
Bids for the San Vicente Reservoir Dam Raise will be opened soon. The bid packages are expected to be favorable that will result in significant cost savings.
• Evaluation of the San Diego County Water Authority’s Special Agricultural Water Rate (SAWR) is continuing. The discount rate may be revised to exclude the supply portion (currently $50/ac. ft. of the total SAWR discount of $111/ac. ft.), but have the storage segment retained. General Manager Arant stated he is advocating the SAWR discount be maintained as-is for two additional years. After two years, the storage component cost will increase commensurate with increasing expenses associated with the San Vicente Reservoir Dam Raise project.
• A membership application was received to join CalDesal, a new advocacy group dedicated to advancing the use of desalination. A public agency’s annual membership in this organization is currently $5,000. Because there are distinct issues to be addressed with each proposed desalination plant, the benefit of a state-wide desalination organization for the District was questioned. Staff will confer with Peter MacLaggan of Poseidon Resources regarding the merits of the District’s membership in the CalDesal organization.
GENERAL COUNSEL’S AGENDA
7. Litigation Against J.M. Manufacturing Company Regarding Inferior Pipe:
General Counsel Cowett reported that notification was received of the litigation against J.M. Manufacturing Company in which the District was named as a potential plaintiff. This litigation is the result of a whistleblower contending that this company manufactured plastic pipe (between 1996 and 2005) that was an inferior product. A Notice of Intent to Intervene was filed by Best, Best & Krieger on behalf of all the clients and a decision whether to pursue this litigation must be made by June. General Counsel Cowett stated he will coordinate data with staff regarding the plastic pipe product installed in the District’s system to determine the District’s position.
BOARD OF DIRECTORS’ AGENDA
8. ACWA/JPIA Refund:
Director Aleshire reported that there is an error in the figures reported by the ACWA/JPIA concerning the District’s workers’ compensation claims. ACWA/JPIA had reported the average workers’ compensation claim from 2000-2004 was valued at $4,514, and the average cost of a claim increased to $14,787 in the last five policy years. Director Aleshire reported that these figures are not correct and that the ACWA/JPIA data will be corrected to reflect the following workers’ compensation claims data (over a 3-year period) for the District:
Total claims paid - $48,165
Premiums paid - $427,013
Claims – 40
Average payment per claim - $1,204
Director Aleshire stated that the District is doing an outstanding job in its education and safety classes which is reflected in the low claims ratio. He noted that other ACWA/JPIA member agencies have average payments per claim of $6,252 (agencies larger than the District) and $6,564 (agencies smaller than the District).
ADJOURNMENT
9. Upon motion by Aleshire, seconded by Haskell and unanimously carried, the meeting was adjourned at 3:37 p.m.
ATTEST: ATTEST:
____________________________ _______________________________ President Secretary