November 17, 2008
VALLEY CENTER MUNICIPAL WATER DISTRICT
Regular Board Meeting
Monday, November 17, 2008
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, Director of Operations Hoyle, Director of Finance Jeffrey, Board Secretary Stetson, Project Manager Kilwein and IT Specialist Learue. Spectators present were Mr. John Christopher and Mr. David Ross.
CONSENT CALENDAR
1. Upon motion by Stone, seconded by Haskell and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held November 3, 2008
• Audit demand check numbers 120425 through 120592
• Treasurer’s Report and Financial Statements for the period ended September 30, 2008
• Report on the assessed values of the District’s service area for Fiscal Year 2008-09 compared to Fiscal Year 2007-08
• Annual report of properties approved for deferral of water availability charges per Administrative Code Section 165.2(f)
ACTION AGENDA
2. Public Hearing to Amend the Interim Agricultural Water Program’s Supply Reduction Implementation Plan:
The public hearing to consider amending the Interim Agricultural Water Program’s (IAWP) Supply Reduction Implementation Plan was opened at 2:03 p.m. Director of Finance Jeffrey explained that in November of 2007, the District’s IAWP Supply Reduction Implementation Plan was adopted which includes a penalty from Metropolitan Water District of Southern California for usage over a participant’s monthly allocation. The penalty currently is $818.00 per acre foot. Metropolitan’s penalty under the IAWP will increase to $925.00 per acre foot effective January 1, 2009. Ordinance No. 2008-10 presented for the Board’s consideration would amend the District’s IAWP Supply Reduction Implementation Plan to provide for the increase in the penalty for water usage over the monthly allocation to $925.00 per acre foot effective January 1, 2009, and that the increases in the penalty imposed by Metropolitan, through January 1, 2014, be passed through to the customers.
A notice of the public hearing had been published in the Roadrunner Newspaper. No written comments were received and there were no comments on this matter from the audience. The public hearing was closed at 2:05 p.m.
Upon motion by Aleshire, seconded by Stone and unanimously carried, the following ordinance, entitled:
ORDINANCE NO. 2008-10
ORDINANCE OF THE BOARD OF DIRECTORS OF
THE VALLEY CENTER MUNICIPAL WATER DISTRICT
AMENDING THE INTERIM AGRICULTURAL WATER
PROGRAM SUPPLY REDUCTION IMPLEMENTATION
PLAN, JANUARY 2009
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
3. Update on the South Village Wastewater Service Area Project:
District Engineer Grabbe provided an update on the South Village Wastewater Service Area Project stating that information was mailed on November 7th to all property owners in the service area. The information provided in the mailer included each parcel’s estimated costs and assessments and set a deadline of December 5, 2008, for the execution by the interested property owners of the Wastewater Service Agreement to reserve capacity in the wastewater project. The Wastewater Service Agreement will secure commitments (financial commitment) for the design phase from property owners participating in the wastewater expansion project. An informational meeting for interested property owners will be held the evening of November 19th in the District’s Board Room.
District Engineer Grabbe reviewed that property owners’ interest in pursuing an expansion to the Woods Valley Ranch Water Reclamation Facility had been solicited. Capacity reservations for 190 equivalent dwelling units (EDUs) of capacity were collected with the initial $2,500 per EDU deposit payments. These deposits were used to fund completion of the project’s Master Plan, Environmental Impact Report and Preliminary Design Report. The Wastewater Service Agreements from participating property owners will provide the security commitments for the District to obtain interim funding for the project’s design phase. A completed project design and construction bids are required to form an assessment district that will provide the permanent financing for the wastewater expansion project. The level of participation in the wastewater expansion project will determine if the project is pursued.
Upon completion of the Preliminary Design Report, project costs were estimated for the components of the project: collection system, wastewater treatment plant expansion, seasonal storage facilities, engineering design services, project and construction management services, easement/land acquisition, assessment district formation, etc. Costs associated with the treatment and disposal were allocated on an EDU basis and costs associated with the collection system were allocated on a reach and capacity basis. Due to the wide service area, the cost per EDU ranges from approximately $21,700 to $105,000 per EDU. A reduction in the cost per EDU would be achieved if the number of participating parcels in the wastewater service area is increased as currently many pipelines will be constructed past parcels that are not included in the expansion project. As such, reservation deposits of $2,500 per EDU for additional wastewater capacity are again being accepted. Also, property owners may reserve additional EDUs that exceed their current zoning allocation if the requested EDUs do not exceed the zoning allocation of the proposed General Plan Update and EDUs over the existing zoning allowance must be cash financed and cannot be financed through the proposed assessment district. In addition, the total expansion project’s EDUs may not exceed the total EDUs per the current zoning.
Wastewater capacity to serve the District’s corporate facility site is 35 EDUs at $37,670/EDU or $1,320,000. This cost plus a cost of $364,000 for 16 EDUs, which is the balance of the second module, is a total obligation from the District of $1,684,000. District Engineer Grabbe explained that if the assessment district successfully forms for the wastewater expansion project, two modules at the plant are being proposed; one for Bell/Alti expansion and one for the property owners that elected to participate. Each module will have 210 EDUs of capacity and with 194 EDUs of property owners’ requested capacity, the remaining 16 EDUs would be funded by the District and available for purchase in the pool for future wastewater capacity requirements.
Bell Enterprises and Alti Corporation, developers that will be funding expansion of the Woods Valley Ranch Wastewater Facility for their planned land improvements, were unable to attend the meeting, but requested that their concerns be addressed. District Engineer Grabbe stated that Bell Enterprises and Alti Corporation (Bell/Alti) are concerned about the minimum sizing requirements of the facility improvements and District staff costs. Bell/Alti’s development requirements for wastewater capacity are 147 EDUs or approximately 40,000 GPD. The module requirement for Bell/Alti is 80,000 GPD capacity to provide system redundancy that will facilitate operational requirements as an inland discharger and maintain compliance with the wastewater discharge permit. In the future, there could be a reimbursement of costs for the facility improvements that benefit a future expansion. District staff expenses, which include consultant fees, are estimated at $1,136,944 through the construction phase. This estimated cost is in line for a project with a total cost of $14.3 million considering the consultants’ costs and the expenses associated with inspection.
A schedule of the proposed Woods Valley Ranch Water Reclamation Facility expansion project was reviewed. Project design is estimated from January 2009 to June, with bid and awarding the project (including formation of an assessment district) estimated to be from July to December 2009. Bond sales could occur by March 2009 and construction completed by December 2010.
4. Resolution Adopting Retirement Health Savings Plan:
Director of Finance Jeffrey reviewed that per the Memorandum of Understanding with employees, an employee hired on or after July 1, 2008, shall not be included in the current defined benefit post retirement medical program, but included in a new defined contribution plan. Said plan shall provide for tax exempt contributions and tax exempt use of funds for eligible medical related expenses. The source of pre-tax funding will come from:
Employees’ 1% payroll deduction
District match of 1% of payroll deduction
Accumulated cash value of sick leave at separation
In evaluating a defined contribution plan to fund new employees’ medical insurance upon retirement, the goal was to have a third party administer it with the participants directing their own investments to best meet their goals. ICMA Retirement Corporation (ICMA-RC) has an Employer VantageCare Retirement Health Savings Plan that meets our requirements. ICMA-RC charges two fees for the Plan; a fee of 0.40% of asset values, plus $30 per year when a participant becomes eligible to withdraw funds. Staff recommended that to partially offset these fees, the District’s contribution be increased from 1% of payroll to 1.15% of payroll plus $30.00 per year per employee during employment.
Director Aleshire stated that the District is not obligated by the MOU with employees to pay the management fees associated with the proposed defined contribution plan to fund medical insurance for employees upon retirement. Staff noted that if staff were to manage and administer the plan, costs would be incurred. When the previous retirement plan for employees was administered by staff, approximately $10,000 per year had been incurred.
Upon motion by Aleshire, seconded by Haskell and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2008-38
ADOPTION OF THE VANTAGECARE
RETIREMENT HEALTH SAVINGS (RHS) PLAN
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
5. Approval of Third Agreement Between the District and San Pasqual Band of Indians Regarding Water Supply:
At present, the District supplies emergency water service to a portion of the San Pasqual Band of Indians reservation that is not within the District’s service area through an agreement to supply the emergency water which expired December 31, 2007. In June of 2008, San Pasqual was notified that a modification of the agreement was desired that would include a termination clause in the event that municipal and industrial reductions from Metropolitan Water District of Southern California were imposed due to a shortage of water supplies and there is no longer surplus water.
A letter received from Mr. Jeff Kightlinger, General Manager of the Metropolitan Water District, stated that Metropolitan would continue to provide water to San Pasqual through September 9, 2009, when it is anticipated that the San Luis Rey Indian Water Rights Settlement Act will be complete. Upon settlement of the Indian Settlement the tribes will have their own water that is being wheeled to them through wheeling agreements with Metropolitan Water District and the San Diego County Water Authority. At present, however, there is no wheeling arrangement with the District. A condition of approval of the Third Agreement to provide water supply to the San Pasqual Band of Indians is that the deliveries will be reduced by the same amount that Metropolitan reduces deliveries to its member agencies. The Third Agreement establishes that the price of water delivered by the District to the San Pasqual Band of Indians through a meter to serve lands outside of the District’s service area shall be at the current domestic potable water charge plus an additional $43.35 per acre foot as an out of District service charge plus an amount equal to Metropolitan Water District’s Tier 2 water rate. General Counsel Cowett stated that when the wheeling agreement is negotiated between the District and the San Pasqual Band of Indians that will deliver the water to the tribe per the San Luis Rey Indian Water Rights Settlement Act, he will pursue securing some of the water rights in consideration of the wheeling arrangements.
Upon motion by Polito, seconded by Aleshire and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2008-39
RESOLUTION OF THE BOARD OF DIRECTORS OF
THE VALLEY CENTER MUNICIPAL WATER DISTRICT
APPROVING THE THIRD AGREEMENT BETWEEN
THE DISTRICT AND SAN PASQUAL BAND OF
INDIANS REGARDING WATER SUPPLY
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:
• Informational meetings will be held at the District’s office to assist customers with the opt-out option of the Interim Agricultural Water Program. These meetings are scheduled for November 17th (6:00 p.m.), November 18th (5:00 p.m.), and November 24th (10:00 a.m., 2:00 p.m. and 5:00 p.m.).
• Progress in establishing exchange partners to facilitate the distribution of desalted seawater from the Carlsbad Desal. Plant is continuing.
• The solar project at Lake Turner is nearly complete. The project is expected to be finished by the first or second week in December.
BOARD OF DIRECTORS’ AGENDA
7. California JPIA Risk Management Conference:
Director Aleshire reported he had attended the JPIA Risk Management Conference recently in Palm Springs. One speaker was very motivational with her presentation on “Being at the Top of Your Game” pertaining to service to customers. The most wide spread customer service problem is indifference. To achieve customer service goals requires continuous coaching. A positive customer service experience is a result of the person receiving service that is reliable, responsive, a solution provided and it exceeded expectations. Generational diversity in the work force (Traditionalists, Baby Boomers, Generation X and Generation Y) and their characteristics were reviewed.
CLOSED SESSION
8. A Closed Session was called by President Broomell at 3:55 p.m. pursuant to:
· Government Code §54956.9(b), Conference with Legal Counsel, Anticipated Litigation
Number of potential cases: 1
RECONVENE
9. The Regular meeting was reconvened at 4:10 p.m. There was no reportable action.
ADJOURNMENT
10. Upon motion by Aleshire, seconded by Haskell and unanimously carried, the meeting was adjourned at 4:11 p.m.
ATTEST: ATTEST:
____________________________ _______________________________
President Secretary
November 17