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HomeMy WebLinkAboutBOARD MINUTES 11-17-94 207 MINUTES OF THE REGULAR BOARD MEETING OF THE DISTRICT BOARD OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT HELD ON NOVEMBER 17, 1 994 The District Board of the Central Contra Costa Sanitary District convened in a regular session at its regular place of meeting, 5019 Imhoff Place, Martinez, County of Contra Costa, State of California, at 3:00 p.m. on November 17, 1994. In the absence of President Rainey, President Pro Tem Dalton called the meeting to order and requested that the Secretary call roll. 1. ROLL CALL PRESENT: Members: Menesini, Hockett, Dalton ABSENT: Members: Rainey President Rainey had indicated previously that she would be unable to attend this meeting and had requested that she be excused. a. ADOPT RESOLUTION APPOINTING PARKE L. BONEYSTEELE TO THE CENTRAL CONTRA COSTA SANITARY DISTRICT BOARD OF DIRECTORS ADMINISTER OATH OF OFFICE b. Mr. Roger J. Dolan, General Manager-Chief Engineer, stated that because of a legal technicality, the Board will be unable to appoint Mr. Parke L. Boneysteele to the Central Contra Costa Sanitary District Board of Directors at this meeting. State statute requires a notice of vacancy be posted at least 15 days before the appointment is made. There was insufficient time to complete the required posting. Mr. Boneysteele will take his place on the Board of Directors at the December 15, 1994 Board Meeting. 2. PUBLIC COMMENTS None 3. AWARDS AND COMMENDATIONS CONGRATULATE MEMBER WILLIAM C. DALTON UPON 15 YEARS OF SERVICE AS A DISTRICT BOARD MEMBER a. Mr. Dolan, General Manager-Chief Engineer, stated that Member Dalton was unable to attend the recent Service Awards luncheon at which those people who have served the District for ten, fifteen, twenty, twenty-five, and thirty years were recognized. William C. Dalton has served on the Board of Directors for 15 years, following over 22 years as a District employee. As a Member of the Board of Directors, Member Dalton's knowledge and experience have provided both historical perspective and technical expertise. Mr. Dolan was joined by the Board and staff in acknowledging and congratulating Member Dalton for his contribution to the District. President Pro Tem Dalton thanked those present for their good wishes. 4. CONSENT CALENDAR It was moved by Member Menesini and seconded by Member Hockett, that the Consent Calendar, consisting of Items a. and b., be approved as recommended, resolutions adopted as appropriate, and recordings duly authorized. a. Resolution No. 94-099 accepting work and Offers of Dedication from Elmer E. Batts, et ux, Job No. 5022, Parcel 2, was adopted and recording was authorized. Motion approved on the following vote: 11 17 94 208 AYES: Members: Menesini, Hockett, Dalton NOES: Members: None ABSENT: Members: Rainey b. The Agreement relating to Real Property with Ronald L. Cetraro, Job 3362, was approved, the President of the Board of Directors and the Secretary of the District were authorized to execute and record said agreement, and Resolution No. 94-100 was adopted to that effect. Motion approved on the following vote: AYES: Members: Menesini, Hockett, Dalton NOES: Members: None ABSENT: Members: Rainey 5. HEARINGS a. CONSIDER APPEAL OF MR. MALCOLM KIRBY OF STAFF DECISION DENYING HIS REQUEST FOR WAIVER OF FEES FOR HIS RESIDENCE AT 44 SOUTHWOOD DRIVE. ORINDA At 3: 12 p.m., President Pro Tem Dalton opened the hearing to consider the appeal of Mr. Malcolm Kirby of the staff decision denying his request for waiver of fees for his residence at 44 Southwood Drive, Orinda. Mr. Malcolm Kirby addressed the Board, stating that his house is the only house on Southwood Drive between Davis Street and Tara Road. The house was built in 1940 about nine years before the sewer was constructed. When the sewer was constructed it was built too shallow for a gravity connection to the house. Mr. Kirby stated that when he recently learned that his house was not connected to the line, he requested and received a refund of Sewer Service Charges paid since 1978 when he purchased the house. Since that time it has been necessary to abandon the septic tank and connect to the sewer. Mr. Kirby stated that installation of a lift pump was required and there was a substantial expense involved in this process. In addition, the lift system is noisy and subject to failure during a power outage. Mr. Kirby stated that the fees he was charged are significantly higher than they would have been if the house had been connected when the sewer was originally constructed. Since he was paying Sewer Service Charges from the time he purchased the house, Mr. Kirby was not aware that he was not connected to the sewer and so did not correct the problem earlier. Mr. Kirby stated that he has been hurt financially and requested that the Board consider waiving the fees paid at the time of connection to the sewer. Mr. Dolan, General Manager-Chief Engineer, introduced Infrastructure Division Manager Jay S. McCoy, who reviewed the chronology of events as described by Mr. Kirby. Mr. McCoy stated that after reviewing the events, he concluded that the District did not receive the proper notification from the former owner of Mr. Kirby's property, resulting in the erroneous Sewer Service Charge billing. As stated by Mr. Kirby, the fees paid for which no service was received were refunded in accordance with State statute. Mr. McCoy stated that after review, he could find no basis for refund of fees associated with connection to the sewer. Mr. McCoy stated that in 1949 when this sewer was installed, Local Improvement Districts (LIDs) were formed to provide sewer service to local residents. To save money for the residents, sewers were installed at a nominal depth of five feet. At that time, Mr. Kirby's lot was twice as big, one sewer was installed at the top of the lot, and another sewer was installed at the bottom of the lot where the fall was approximately 10 feet and gravity service could be achieved. In 1985, the large lot was split into two smaller lots. The way the house is situated on the second lot virtually precludes a gravity sewer to Mr. Kirby's house. Originally, the sewer was installed to provide gravity flow to Mr. Kirby's house and could have if the lot had not been split and a new house built. Mr. McCoy stated that in reviewing Mr. Kirby's request for waiver of fees, he found no justification for a waiver and would recommend that the request be denied. 11 17 94 209 Discussion followed with regard to the value added by virtue of availability of a sewer connection, the costs associated with connection, and the fact that when Mr. Kirby split the lot he was under the impression that his house was connected to the sewer system. Following discussion, it was moved by Member Menesini and seconded by Member Hockett, that the inspection charge in the amount of $231.00 associated with the connection of Mr. Kirby's residence to the sewer system, be waived and returned to Mr. Kirby, but that the remainder of. the fees collected at the time of connection be retained by the District as equitable payment for the services provided. There being no objection, the motion was approved with Member Rainey being absent. 6. CALL FOR REQUESTS TO CONSIDER ITEMS OUT OF ORDER Mr. Dolan, General Manager-Chief Engineer, requested that the Board depart from the order of the agenda, and that Items 12b., 12a., and 7a. be taken out of order to accommodate interested persons in the audience. There being no objection, President Pro Tem Dalton proceeded to Item 12b. 12. BUDGET AND FINANCE b. ADOPT RESOLUTIONS APPOINTING BOND COUNSEL; APPROVING. AUTHORIZING. AND DIRECTING THE EXECUTION OF DOCUMENTS; AND AUTHORIZING THE DELIVERY OF AND APPROVING THE PRELIMINARY OFFICIAL STATEMENT FOR 1994 REVENUE INSTALLMENT CERTIFICATES (WASTEWATER FACILITIES IMPROVEMENT PROGRAM) Mr. Dolan, General Manager-Chief Engineer, stated that Board approval is requested to appoint Bond Counsel and authorize the borrowing of funds through long-term Revenue Installment Certificates. In addition, the issue of the term of the bond must be finally determined by the Board. Mr. Dolan introduced Mr. Michael D. Castelli, partner in the firm of Jones Hall Hill & White. Mr. Castelli stated that two resolutions are presented for Board consideration: the first appointing Bond Counsel; and the second authorizing execution of documents, and delivery of and approval of the Preliminary Official Statement for the 1994 Revenue Installment Certificates in an amount not to exceed $25 million. Mr. Castelli described the requirement for a firm to serve as Bond Counsel for this transaction. The firm of Jones Hall Hill & White is recommended by staff for appointment as Bond Counsel as a result of a Request for Proposals (RFP) process. Based on the thorough review of this issue by the Board Budget and Finance Committee, it would be appropriate at this time to consider appointment of Bond Counsel. It was moved by Member Hockett and seconded by Member Menesini, that Resolution No. 94-101 be adopted, appointing the firm of Jones Hall Hill & White as Bond Counsel. Motion approved on the following roll call vote: AYES: Members: Hockett, Menesini, Dalton NOES: Members: None ABSENT: Members: Rainey Mr. Castelli stated that the second resolution before the Board approves the financing. The resolution approves up to $25 million in Installment Certificates, approves the sale of those Certificates in a public sale, and approves the notice to call for bids. The securities will be sold to the person giving the lowest cost to the District at a public sale now scheduled for December 6, 1994. The resolution also approves the offering document which describes the Certificates and the District to the investing public. The resolution adopts two financing documents and describes the structure of the installment sale. The remainder of the resolution approves any other ministerial items required to effectuate purposes of the sale. Mr. Castelli stated that the one item outstanding is the term of the Certificates. Mr. Castelli introduced Mr. Thomas Lockard, partner in the firm of Stone and Youngberg, the District's Financial Advisor for the long-term Certificates. Mr. Lockard stated that as 11 17 94 210 part of this approval process, the Board is approving certain parameters including the term of the Certificates. Mr. Lockard described the pros and cons of the various terms, recommending that the term of 20 years be selected based on the following: Twenty years is assumed in the D.istrict's Capital Improvement Plan; 1 ) 2) Rating agencies consider a 20-year term as compared to a 30-year term, a strength; and 3) Insurance costs would be less for a 20-year term than a 30-year term. Following discussion, it was moved by Member Menesini and seconded by Member Hockett, that a term of 20 years be approved for the 1994 Revenue Installment Certificates (Wastewater Facilities Improvement Project). Motion approved on the following roll call vote: AYES: Members: Menesini, Hockett, Dalton NOES: Members: None ABSENT: Members: Rainey It was moved by Member Menesini and seconded by Member Hockett, that Resolution No. 94-102 be adopted, approving, authorizing, and directing execution of certain installment sale financing documents in connection with a proposed issue of 1 994 Revenue Installment Certificates (Wastewater Facilities Improvement Project) in an amount not to exceed $25 million; approving the forms of a notice of sale, a notice of intention to sell, the preparation of an Official Statement for such Installment Certificates, and other matters related thereto. Motion approved on the following roll call vote: AYES: Members: Menesini, Hockett, Dalton NOES: Members: None ABSENT: Members: Rainey At this time, President Pro Tem Dalton proceeded to Item 12a. a. 12. BUDGET AND FINANCE ESTABLISH THE "CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY." A NONPROFIT CORPORATION. AND CONDUCT AN ORGANIZATIONAL MEETING OF THE AUTHORITY President Pro Tem Dalton adjourned the meeting of the Central Contra Costa Sanitary District Board of Directors at the hour of 4:06 p.m. At 4:06 p.m., President Menesini convened the organizational meeting of the Central Contra Costa Sanitary District Facilities Financing Authority. President Menesini requested that the Secretary call roll. PRESENT: Directors: Dalton, Hockett, Menesini ABSENT: Directors: Rainey With respect to adoption of Bylaws, Mr. Dolan, General Manager-Chief Engineer, stated that constructive comments were received and will be incorporated into the Bylaws. The Bylaws are amendable by the Board of the Financing Authority if necessary in the future. It was moved by Director Dalton and seconded by Director Hockett, that Resolution No. 94-1 be adopted, adopting the Bylaws of the Central Contra Costa Sanitary District Facilities Financing Authority. Motion approved on the following vote: 11 17 94 211 AYES: Directors: Dalton, Hockett, Menesini NOES: Directors: None ABSENT: Directors: Rainey It was moved by Director Hockett and seconded by Director Dalton, that Resolution No. 94-2, designating the time and place for regular meeting, and that Resolution No. 94-3, approving and authorizing execution and filing of exemption application to the State Franchise Tax Board, be adopted. Motion approved on the following vote: AYES: Directors: Hockett, Dalton, Menesini NOES: Directors: None ABSENT: Directors: Rainey It was moved by Director Hockett and seconded by Director Dalton, that Resolution No. 94-4, approving and authorizing execution and filing of various Federal forms, be adopted. Motion approved on the following vote: AYES: Directors: Hockett, Dalton, Menesini NOES: Directors: None ABSENT: Directors: Rainey It was moved by Director Dalton and seconded by Director Hockett, that Resolution No. 94-5 be adopted, approving installment sale of Wastewater Improvements to the Central Contra Costa Sanitary District, authorizing execution of related installment sale agreement, assignment agreement and trust agreement, appointing counsel, and approving delivery and sale of not-to-exceed $25,000,000 principal amount of 1994 Revenue Installment Certificates and related matters. Motion approved on the following vote: AYES: Directors: Dalton, Hockett, Menesini NOES: Directors: None ABSENT: Directors: Rainey There being no further business to come before the Board, President Menesini adjourned the meeting of the Central Contra Costa Sanitary District Facilities Financing Authority at the hour of 4: 1 0 p.m. President Pro Tem Dalton reconvened the regular meeting of the Central Contra Costa Sanitary District Board of Directors at the hour of 4: 1 0 p.m. with all parties present as previously designated. At this time, President Pro Tem Dalton reverted to the order of the agenda. 7. SOLID WASTE a. RECEIVE ANALYSIS OF REFUSE COLLECTION RATE APPLICATION SUBMITTED BY ORINDA MORAGA DISPOSE-ALL AT A BOARD WORKSHOP Mr. Dolan, General Manager-Chief Engineer, stated that at the last Board Meeting a rate was approved for the Valley Waste Management franchise area which included a 20 percent rate reduction. At that time there was a substantial amount of negotiation that went into the rate reduction. As a matter of routine business, the Orinda Moraga Dispose- All (OMD) rate is coming before the Board. A 14-month extension is proposed through the end of the franchise, February 29, 1996, unless some exceptional event occurs which would require further consideration. Mr. Dolan introduced Mr. Robert Hilton, of Hilton Farnkopf & Hobson, who thanked District staff and OMD staff for their assistance in this rate analysis. Mr. Hilton stated that the key issues with respect to the 1995 OMD rate review include: 11 17 94 212 . Revenue surplus; . Landfill disposal rates; . Acme Landfill closure lawsuit; . O.L.S. lawsuit; . Revenue and expense balancing account; . Post-franchise activities; and . Service modification factors. Mr. Hilton stated that the current projected revenues are slightly greater than last year's forecast by $9,000 resulting from offsetting variances within each rate revenue category and substantially higher than forecasted recycling revenues. Mr. Hilton stated that landfill disposal rates are declining. OMD was disposing of solid waste at Acme transfer station at $75.97 per ton. The company has now signed a nine- year disposal agreement with West Contra Costa Sanitary Landfill, Inc. (WCCSL) effective October 1, 1994. The disposal rate for the period October 1, 1994 through March 31, 1995 is $72/ton. The disposal rate then drops to $31.50/ton for the period April 1, 1995 through February 29, 1996. The reason for the high price initially is that there is indemnification in favor of OMD, the District, the cities, the county, and the ratepayers by WCCSL and Potrero Hills Landfilll with respect to receipt of acceptable solid waste originating in the franchise area which is delivered to WCCSL or PHL respectively. In spite of the initial higher rate, disposal at WCCSL is less than the Browning Ferris Industries/Keller Canyon Landfill proposal of $51.24/ton and is approximately the same as the Waste Management/Altamont Landfill proposal of $32.79/ton. With respect to the Acme Landfill closure lawsuit filed in 1991 to close the hazardous waste section of the landfill, Mr. Hilton stated that the Contra Costa County program to assess expenses was not implemented. The case has been set for trial in September 1 995. Legal expenses related to the lawsuit in the amount of $112,000 for 1995 were included in the rate application. Mr. Hilton stated that the O.L.S. lawsuit was brought to the attention of the District on October 31, 1994. OMD and its stockholders were sued for non-performance under an October 3, 1990 agreement with O.L.S. OMD estimates legal expenses of $50,000 to $100,000 related to that lawsuit. The District's legal counsel has determined that the O.L.S. case is unrelated to OMD's franchise obligations with the District. No expenses for this matter were included in the rate application or recommended for rate adjustment. Mr. Hilton stated that the revenue and expense balancing account was implemented in 1991. The difference between actual and forecasted income is carried forward, providing a disincentive to over-estimate expenses or under-estimate revenues. It is projected that $327,000 will be due to the ratepayers from the balancing account for the 1995 rate- setting process. Mr. Hilton stated that because post-franchise activities are not addressed in the franchise agreement, these expenses are not included in the recommended rates. OMD has requested $126,200 reimbursement for post-franchise activities. Mr. Hilton stated that possible criteria for reasonableness of these expenses include continuing to service to the ratepayers and closing out activities which have substantially benefited ratepayers. Mr. Hilton stated that expenses in the amount of $ 7,000 to demolish and cleanup the Moraga yard and expenses in the amount of $33,000 to maintain administrative offices for three months could be considered to meet this criteria for reimbursement. Member Menesini requested additional information from OMD supporting their request for reimbursement of post-franchise activities in the amount of $126,200. With regard to the service modification factors, Mr. Hilton stated that profit for 1994 was calculated based on the Customer Equivalent Units methodology. The Board must determine the quality of service modification factor and the cost of service modification factor considering the quality of the service and the reasonableness of rates. 1117 94 213 Discussion followed with regard to criteria for evaluation of the service modification factors. In closing, Mr. Hilton provided an overview of the 1 995 OMD rate review. The company had requested a 1.9 percent rate increase but that request was submitted prior to negotiation of the disposal contract with WCCSL. Mr. Hilton presented the following recommendations: . That landfill disposal rates be approved at $72.00/ton for the period January 1, 1995 through March 31, 1995, and $31.50/ton for the period April 1, 1995 through February 29, 1996; . That the effect of the significant increase in officer/owner compensation in 1993 be eliminated; . That the Teamster labor union contract increase of 5 percent for 1994 be approved, and that allowance be made for increase in union wages; and . That two alternative rate adjustments be considered: 1 ) That rates be decreased 19.66 percent, excluding expenses related to post-franchise activities; or 2) That rates be decreased 19.05 percent, allowing $40,000 in post- franchise expenses. Mr. Hilton reviewed the allowable profit computation and presented the current rates and rates resulting from the calculations based on a 19.66 percent rate reduction. Mr. Doug Lomow, owner of OMD, addressed the Board relative to the matter at hand. With regard to the O.L.S. lawsuit, Mr. Lomow stated that this lawsuit results from the company's efforts to secure long-term disposal capacity as an alternative to the Acme $70/ton rate. With respect to post-franchise activities, Mr. Lomow stated that OMD has been in business for 55 or 56 years, and there will be costs associated with post-franchise activities after that period of time. With respect to spreading the disposal rate over 14 months, Mr. Lomow stated that a shortfall in operating cash will result in January, February and March of 1995. For that reason, Mr. Lomow requested that the Board consider financing that shortfall. In closing, Mr. Lomow noted that for the third year in a row, OMD has come in under budget on controllable line items. Mr. Lomow thanked the Board for their consideration. Member Menesini requested that Mr. Lomow provide additional information at the time of the public hearing, justifying the request for costs associated with post-franchise activities. Mr. Dolan stated that staff will try to secure additional information relating to costs for post-franchise activities. In addition, District Counsel will provide information on the issue of legal fees on the O.L.S. lawsuit. 8. PERSONNEL a. ADOPT AN ORDINANCE AMENDING DISTRICT CODE CHAPTER 4.28.010- 4.28.030. SEXUAL HARASSMENT Mr. Dolan, General Manager-Chief Engineer, introduced Human Resources Manager Cathryn Freitas, who reported that the District has conducted annual sexual harassment training for a number of years. As part of this year's training, the sexual harassment policy was reviewed, input was solici;ted from all employees, suggestions were made by a consultant who specializes in this area, the suggestions were reviewed by the District's labor counsel, and finally training was conducted with all District employees. The final draft of the policy was reviewed by the District's Management Team and is now offered to the Board as the final compilation of the input received to date. Discussion followed concerning the complaint and investigation process, the suggestion that written reports of sexual harassment incidents be encouraged, and that a complaint procedure be formalized and included in the document. 11 17 94 214 Following discussion, it was moved by Member Menesini that the ordinance amending District Code Chapter 4.28.010-4.28.030, Sexual Harassment, be adopted and that the Sexual Harassment Policy be adopted as modified to incorporate a complaint procedure. The motion died for lack of a second. Member Hockett requested that the matter be brought back to the Board for final consideration after the proposed changes have been made. Following further discussion, it was moved by Member Menesini and seconded by Member Hockett, that Ordinance No. 193 be adopted, amending District Code Chapter 4.28.010- 4.28.030, Sexual Harassment; and that the Sexual Harassment Policy be amended to incorporate a complaint procedure and other suggestions proposed by the Board and brought back to the Board for final review and acceptance. Motion approved on the following roll call vote: AYES: Members: Menesini, Hockett, Dalton NOES: Members: None ABSENT: Members: Rainey 9. CORRESPONDENCE a. NOTE RECEIPT OF LETTER DATED NOVEMBER 4. 1994. FROM MR. ALBERT BIANCHI. OF BIANCHI. ENGEL KEEGIN & TALKINGTON. REGARDING GARBAGE AND REFUSE COLLECTION FRANCHISING: CONSIDER DRAFT RESPONSE Receipt of the letter dated November 4, 1994, from Mr. Albert Bianchi, of Bianchi, Engel, Keegin & Talkington, regarding garbage and refuse collection franchising, was noted and the draft response was approved. 10. APPROVAL OF MINUTES a. MINUTES OF OCTOBER 20. 1994 b. MINUTES OF NOVEMBER 2. 1994 c. MINUTES OF NOVEMBER 3. 1994 It was moved by Member Hockett and seconded by Member Menesini, that the minutes of October 30, 1994, November 2, 1994, and November 3, 1994, be approved as presented. There being no objection, the motion was approved with Member Rainey being absent. 11. APPROVAL OF EXPENDITURES a. EXPENDITURE LIST DATED NOVEMBER 17. 1 994 Member Menesini, Chair of the Budget and Finance Committee, stated that he and Member Dalton reviewed the expenditures and found them to be satisfactory. Because of the recent level of activity, Member Menesini requested that staff provide a update on the Co-Generation Project. It was moved by Member Menesini and seconded by Member Hockett, that the Expenditure List dated November 17, 1994, including Running Expense Check Nos. 85553-85885, Sewer Construction Check Nos. 85700-85740 and 14936-14964, and Payroll Check Nos. 36584-36871, be approved as recommended. There being no objection, the motion was approved with Member Rainey being absent. 12. BUDGET AND FINANCE a. ESTABLISH THE "CENTRAL CONTRA COSTA SANITARY DISTRICT FACILITIES FINANCING AUTHORITY." A NONPROFIT CORPORATION. AND CONDUCT AN ORGANIZATIONAL MEETING OF THE AUTHORITY This item was taken out of order earlier in the agenda. 11 17 94 b. 215 ADOPT RESOLUTIONS APPOINTING BOND COUNSEL: APPROVING. AUTHORIZING. AND DIRECTING THE EXECUTION OF DOCUMENTS: AND AUTHORIZING THE DELIVERY OF AND APPROVING THE PRELIMINARY OFFICIAL STATEMENT FOR 1994 REVENUE INSTALLMENT CERTIFICATES (WASTEWATER FACILITIES IMPROVEMENT PROJECT) This item was taken out of order earlier in the agenda. c. RECEIVE OCTOBER 1994 FINANCIAL STATEMENTS Ms. Deborah Ratcliff, Controller, reported the results of operations and maintenance (O&M) for the month of October 1994, noting that expenditures were $190,000 less than budget, representing an 8.5 percent favorable variance. Year-to-date expenditures were $893,000 less than budget, representing a 9.7 percent favorable variance. O&M revenues of $1.5 million were 23 percent favorable to budget. Ms. Ratcliff reported that the District's temporary investments were held in Treasury bills and Treasury notes and the District's Local Agency Investment Fund (LAIF) account with interest rates ranging from 3.7 percent to 5.59 percent. The latest interest rate as of May 1994 was 5.1 percent. The average yield of the LAIF account was 4.96 percent. Mr. Jay S. McCoy, Infrastructure Division Manager, stated that for more than a year the District has been involved in two major projects, the Pleasant Hill Interceptor Project and the Headworks Facilities Improvement Project. Ranger Pipeline is the contractor for the Pleasant Hill Interceptor Project. The contract price is $14.7 million. The work is 95 percent completed, with an estimated project completion date of January 1995. The contractor for the Headworks Facilities Improvement Project is Humphries Construction. The contract price is $18.9 million. The work is 96 percent completed, with an estimated project completion date of January 1995. The Board commended staff for their diligent efforts which resulted in the positive budget situation. President Pro Tem Dalton declared that the October 1994 Financial Statements were duly received. None a. 13. EMERGENCY SITUATIONS REQUIRING BOARD ACTION 14. REPORTS GENERAL MANAGER-CHIEF ENGINEER 1 ) Mr. Dolan, General Manager-Chief Engineer, stated that about a year ago the Board adopted a revised set of Facilities Capacity Fees based on a modified rate-setting approach. The new approach included a buy-in component for existing assets. Two related issues were resolved at that time: 1) The time of payment of Facilities Capacity Fees; and 2) The Board requested assurance that newly increased fees would recover actual cost of service for customers to be served by the San Ramon Valley Interceptor. Mr. Dolan introduced Mr. Jarred Miyamoto-Mills, Principal Engineer, who provided an update on the Zone 3 (San Ramon Valley area) Fees, stating that Zone 3 is defined as areas tributary to the San Ramon Valley Interceptor where development was not "planned" when the interceptor project was approved in 1986. Mr. Miyamoto-Mills reviewed the Future Facilities Component, the Existing Capital Assets Component, and the Operations and Maintenance Expense Component of the cost of services. Mr. Miyamoto-Mills noted that when development is added to the District service area, because of economies of scale, the District is able to reap some benefit by keeping the Sewer Service Charge down. This analysis would apply to any area in the District where development occurs. Member Menesini stated that he still has concern with regard to the value of the service to the customers and the possibility that the actual value of the assets may not be reflected accurately in the numbers presented. Mr. Miyamoto-Mills stated that the numbers are low in the area of the facilities that were constructed with State and Federal grant funds. The terms of the 11 17 94 216 grants mandated the way in which the public was to be charged for the facilities constructed. In conclusion, Mr. Miyamoto-Mills stated that the current Capital Improvement Fee approach is appropriate for Zone 3 developments that may occur in the future and no change is recommended at this time. President Pro Tem Dalton thanked Mr. Miyamoto-Mills for his report. 2) Mr. Dolan, General Manager-Chief Engineer, invited the Board to attend the District's holiday party which will be held on December 10, 1994 at the Crockett Community Center. b. COUNSEL FOR THE DISTRICT 1 ) In the absence of Mr. Kenton L. Aim, Counsel for the District, Mr. Mark Cornelius, Associate Counsel for the District, reported that legal staff is working with representatives of Valley Waste Management and Orinda- Moraga Dispose-All with regard to legal fees relating to the Acme litigation matter. It is anticipated that this matter will be presented for Board consideration at the Board Meeting of December 15, 1994. c. SECRETARY OF THE DISTRICT None d. BOARD MEMBERS None 15. ANNOUNCEMENTS None 16. ADJOURNMENT There being no further business to come before the Board, President Pro Tem Dalton adjourned the meeting at the hour of 6:35 p.m. President of the Board of Direct Central Contra Costa Sanitary' trict, County of Contra Costa, State of California COUNTERSIGNED: Se re ar.' of the Central ont I C .. Sanitary District, County of Contra Costa, State of California 11 17 94