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HomeMy WebLinkAboutBOARD MINUTES 11-04-04 82 MINUTES OF THE REGULAR BOARD MEETING OF THE DISTRICT BOARD OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT HELD ON NOVEMBER 4, 2004 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 2:00 p.m. on November 4, 2004. President Lucey called the meeting to order and requested that the Secretary call roll. 1. ROLL CALL PRESENT: Members: Menesini, Boneysteele, Nejedly, Hockett, Lucey ABSENT: Members: None a. PLEDGE OF ALLEGIANCE TO THE FLAG Board and staff joined in the Pledge of Allegiance to the Flag. 2. PUBLIC COMMENTS None 3. AWARDS AND COMMENDATIONS a. ADOPT RESOLUTIONS RECOGNIZING SERVICE AWARD RECIPIENTS WESLEY ADAMS. PARKE BONEYSTEELE, KEITH BRAUCH. ROBERT BROWN. SEVERINA CAMORONGAN. ANN CHIAPPELONE. SPENCER CHUN, AARON CORTEZ. RANDY COVEY, DOUGLAS DREWES. WILLIAM ECHOLS. ANN FARRELL, CATHRYN FREITAS. WARREN GAINES. KEITH GORE. SYLVIA GRAY. KIM GREER. TERESE HAMMETT. SUE HASSEL WANDER. ROBERT HINKSON. KAREN HUFF. CLINTON JACKSON. PATRICIA KAST. DORIS KEIFER. CHRISTOPHER KEITH, JAMES KELLY. JAMES KNEIS. PAUL LOUIS. BONNIE LOWE. ALEXAN DR MESTETSKY. TWILA MULLENIX. TRI NGUYEN, ERNESTO RODRIGUEZ, TIMOTHY ROONEY. MICHAEL THORNTON. DWIGHT WILLIAMS. GARTH WILLIAMS. AND JACQUELINE ZAYAC Mr. Charles W. Batts, General Manager, stated that each year the District recognizes employees for every five years of service. This year the District is celebrating the accomplishments of 37 employees and Director Boneysteele, who is celebrating his 35th anniversary with the District. All Board Members have received invitations to the Service Awards luncheon to be held at Vic Stewart's on Friday, November 19 at 11 :30 a.m. This event is the highlight of the year to recognize District employees for their dedication and service to the District. Mr. Batts stated that he hopes Board Members will be able to attend. It was moved by President Lucey and seconded by Member Hockett, that Resolution Nos. 2004-077 throuQh 2004-090 be adopted, recognizing Service Award recipients Wesley Adams, Parke Boneysteele, Keith Brauch, Robert Brown, Severina Camorongan, Ann Chiappelone, Spencer Chun, Aaron Cortez, Randy Covey, Douglas. Drewes, William Echols, Ann Farrell, Cathryn Freitas, Warren Gaines, Keith Gore, Sylvia Gray, Kim Greer, Terese Hammett, Sue Hasselwander, Robert Hinkson, Karen Huff, Clinton Jackson, Patricia Kast, Doris Keifer, Christopher Keith, James Kelly, James Kneis, Paul Louis, Bonnie Lowe, Alexandr Mestetsky, Twila Mullenix, Tri Nguyen, Ernesto Rodriguez, Timothy Rooney, Michael Thornton, Dwight Williams, Garth Williams, and Jacqueline Zayac. Motion unanimously approved on the following vote: 11 -4-04 I I I .-----------------------. ._._---_._--_._---_._-~. . I I I 83 AYES: Members: Lucey, Hockett, Menesini, Boneysteele, Nejedly NOES: Members: None ABSENT: Members: None 4. CONSENT CALENDAR Member Menesini requested that Items 4.b. and 4.c. be removed from the Consent Calendar for discussion. It was moved by Member Menesini and seconded by President Lucey, that the Consent Calendar, consisting of Item a. and excluding Items b. and c., be approved as recommended. a. Medical leave of absence without pay was authorized for Derhyl Houck, Maintenance Technician III, Mechanical, though January 7,2005. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Menesini, Lucey, Boneysteele, Nejedly, Hockett None None Following discussion of the process that will be used for recruitment of the Staff Engineer positions, and the Government regulations and process relating to application for and use of Federal Emergency Management Agency (FEMA) funds, it was moved by Member Menesini and seconded by Member Nejedly, that Consent Calendar Items b. and c., be approved as recommended and resolutions adopted as appropriate. b. Authorization was given for exception to the standard selection process and staff was authorized to underfill existing openings in the Engineering and Operations Departments with Staff Engineers through an on-campus interview process that allows the District to compete with private industry in attracting the best entry level engineering candidates. Motion unanimously approved on the following vote: AYES: Members: Menesini, Nejedly, Boneysteele, Hockett, Lucey NOES: Members: None ABSENT: Members: None c. Resolution No. 2004-091 was adopted, approving the Federal Emergency Management Agency (FEMA) Multi-Hazard Plan for the Central Contra Costa Sanitary District and authorizing submission of the plan. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Menesini, Nejedly, Boneysteele, Hockett, Lucey None None 5. CALL FOR REQUESTS TO CONSIDER ITEMS OUT OF ORDER None 11-4-04 --.-----.---.------.------ 84 6. REPORTS a. GENERAL MANAGER 1) 2) b. c. Mr. Batts, General Manager, announced that on July 7, 2004, the District was notified of a sewer overflow at 1042 Brown Avenue in Lafayette. The overflow caused property damage to the business at that location. District staff cleaned the property and began the usual investigation. That investigation determined that the cause of the overflow was material from a paving contractor for the City of Lafayette that was paving the street in front of the building. The claim was received on October 26. Staff is working with the City of Lafayette on resolution of this matter. Mr. Batts, General Manager, reported that the City of Pleasant Hill has requested that the District defer the paving and reconstruction of Patterson Boulevard until June 2005 to accommodate construction work by the Contra Costa Water District along Patterson Boulevard next spring. The District has a joint powers agreement with the City of Pleasant Hill and had agreed to pay half of the paving cost. An amendment to the joint powers agreement is being negotiated whereby the District will meet its obligation by paying the City of Pleasant Hill $166,800, the amount the District would have spent on paving. The City of Pleasant Hill will then coordinate the paving work after completion of the Contra Costa Water District construction work. A position paper authorizing this change will be presented for the Board's consideration at the November 18 Board Meeting. President Lucey questioned whether Contra Costa Water District should pay a portion of the paving costs, since it would seem that the agreement is going from two parties to three parties. Director of Engineering Ann Farrell stated that staff is looking into this matter and will report back to the Board at the next Board Meeting. 3) Mr. Batts, General Manager, stated that the Board received an invitation to the America Recycling event on November 15, 2004 at 1 :00 p.m. at the Walnut Creek Recycling Center. COUNSEL FOR THE DISTRICT 1) Mr. Kenton L. Aim, Counsel for the District, announced that he will be attending the Association of Metropolitan Sewerage Agencies (AMSA) Clean Water Act Conference in San Diego from November 10 through 12, 2004. SECRETARY OF THE DISTRICT 1) Ms. Joyce E. Murphy, Secretary of the District, distributed and reviewed the Draft 2005 Board Calendar. Following discussion, it was the consensus of the Board that because of conflicts with California Association of Sanitation Agencies (CASA) meetings, the following changes would be made to regular District Board Meeting dates: in January 2005 Board Meetings will be held on January 13 and 27; and in August 2005 only one Board Meeting will be held on August 11, 2005. Ms. Murphy, Secretary of the District, stated that her employment contract with the District will expire next June. As required by that contract, the Board must be notified in November that the term of the contract will be extended automatically for one year unless either party proposes a change. Ms. Murphy announced to the Board that she is planning to retire next spring. 2) 11-4-04 I I I I I I 85 Ms. Murphy stated that it has been a pleasure to work for the Board of Directors and the District for more than 21 years. Ms. Murphy stated that she has enjoyed the challenges and opportunities that have been presented during those 21 years, and that she is proud of the work that the District Board and staff have done together and the things that have been accomplished. Ms. Murphy thanked the District Board and staff for their support through the years, stating that the District is a remarkable place to work and the technical expertise and professionalism of the District Board and staff have made it a pleasure to be part of the District team. Ms. Murphy stated that if there is anything that she can do to assist with the transition, she will be more than happy to do that. In addition, there are capable people on the District team that are ready and willing to step up. Ms. Murphy stated that she awaits the Board's pleasure. President Lucey and the Board of Directors stated that they appreciate the work Ms. Murphy has done, and that they will miss her and wish her well in her retirement. At this time, President Lucey departed from the order of the agenda to consider Item 11., Closed Session. 11. CLOSED SESSION a. PERSONNEL MA TIERS The closed session was held to discuss personnel matters pursuant to Government Code Section 54957. The title of the position to be discussed is Secretary of the District. At 2:19 p.m., President Lucey declared the closed session to discuss personnel matters pursuant to Government Code Section 54957. At 2:36 p.m., President Lucey concluded the closed session and reconvened the meeting into open session. 12. REPORT OF DISCUSSIONS IN CLOSED SESSION No decisions were made or votes taken in closed session that require reporting at this time. At this time, President Lucey reverted to the order of the agenda. 6. REPORTS d. BOARD MEMBERS 1 ) Member Hockett reported on the October 18, 2004 meeting of the Sanitation and Water Agencies of Contra Costa County at which the Green Business Program was the primary topic of discussion. 2) Member Boneysteele, Chair of the Budget and Finance Committee, reported that he and Member Menesini reviewed the expenditures and found them to be satisfactory. In addition, the Committee reviewed the District's investment policy and the 2003-2004 Draft Comprehensive Annual Financial Report that will be presented to the Board at the November 18, 2004 Board Meeting. It was moved by Member Boneysteele and seconded by Member Menesini, that the Expenditure List dated November 4, 2004, including Self Insurance Check Nos. 102163-102164, Running Expense Check Nos. 152623-152804, and Sewer Construction Check Nos. 27143-27175, be approved as recommended. There being no objection, the motion was unanimously approved. 11-4-04 86 3) Member Menesini announced that District Counsel Kenton L. Aim will discuss the Clean Water Act at the November 15, 2004 Environmental Alliance Discussion Series. All those who are interested are invited to attend. 4) President Lucey reported that he attended the recent Contra Costa County Employees Retirement Association (CCCERA) meeting. President Lucey indicated that he will be attending CCCERA meetings in the future and will report back to the Board on items of interest. 7. APPROVAL OF MINUTES I a. MINUTES OF OCTOBER 7, 2004 It was moved by Member Hockett and seconded by Member Menesini, that the minutes of October 7,2004, be approved as presented. There being no objection, the motion was unanimously approved. 8. BUDGET AND FINANCE RECEIVE SEPTEMBER 2004 FINANCIAL STATEMENTS a. Ms. Deborah Ratcliff, Controller, presented the results of operations and maintenance (O&M) for the month of September 2004, noting that expenditures were $209,000 less than budget, representing a 5.8 percent favorable variance. Year-to-date O&M expenditures were $1.2 million less than budget, representing an 11 percent favorable variance. Year-to-date O&M revenues of $670,000 were $71,000 greater than budget. Ms. Ratcliff reported that year-to-date Sewer Construction Fund revenues were $5,112,000 and expenditures were $4,205,000. Ms. Ratcliff reported that the District's temporary investments were held in commercial paper, bankers' acceptances, U.S. Treasury bills, and the District's Local Agency Investment Fund (LAIF) account. The average yield of the District's LAIF account through August was 1.67 percent. I President Lucey declared that the September 2004 Financial Statements were duly received. b. RECEIVE PRESENTATION AND DISCUSS DEVELOPMENT OF DRAFT 2005- -------..; 2006 CAPITAL IMPROVEMENT BUDGET AND 2005 CAPITAL IMPROVEMENT ~ PLAN Mr. Batts, General Manager, stated that the focus of today's Board Meeting will be on the development of the 2005-2006 draft Capital Improvement Budget and Plan. Each year at this time staff outlines the spending targets for the next year's Capital Improvement Budget and Plan. These targets are then used to develop financial planning scenarios for discussion in the January Financial Planning Workshop where rates for the following year are considered. These spending targets also form the basis for the detailed Capital Improvement Plan and Budget that are presented to the Board in April. Mr. Batts stated that the workshop today will also highlight several technical issues in which the Board has expressed interest. In today's presentation, Director of Engineering Ann Farrell will discuss the routing of wet weather flow through the plant and basins, and the findings and impact of the Collection System TV Inspection Program in Orinda. These are two examples of programs that will be driving spending in the next Capital Improvement Budget. After adjournment today, staff will be available to answer any questions Board Members may have on specific projects. Mr. Batts introduced Ms. Ann E. Farrell, Director of Engineering, who stated that this is the kickoff to 2005-2006 budget cycle. The intent of this item is to review the purpose and need for the Capital Program, to assess the current level of revenue and expense, and to review new data on priorities and needs. This discussion will set the direction for I 11-4-04 I I I 87 the January Board Financial Planning and Policy Workshop and recommend Capital Program expenditure levels for consideration at that workshop. The discussion today will also develop direction for the Capital Improvement Budget (CIB) and Ten-Year Capital Improvement Plan (CIP) that will be finalized in April prior to final adoption by the Board in June. Ms. Farrell stated that even after the CIB is adopted, the Board has a continued approval role for consultant agreements over $50,000, for award of construction contracts over $15,000, for project overruns in excess of 15 percent of the project, and for construction change orders over $50,000. Ms. Farrell stated that several years ago, a plan was adopted where an estimate was made of a reasonable investment in the District's assets. The baseline estimate of the Capital Program assumed a 1 OO-year life before replacement. The estimated replacement value of the treatment plant was $600,000,000 and the estimated replacement value of the collection system was $1,500,000,000 for a total estimated replacement value of $2,100,000,000 in January 2000 dollars. That would result in an annual investment of approximately 1 percent per year or $21,000,000 also in January 2000 dollars. That number does not address changing regulations, capacity increases, or District facilities such as the Headquarters Office Building, Collection System Operations facilities, or Plant Operations office building. Using that baseline number of $21 million and assigning a 3 percent per year inflation factor brings the baseline to $24.3 million in 2005-2006. As a comparison, the Engineering News Record (ENR) inflation rate has been 4 percent per year on average for the last five years. The ENR tracks the construction inflation rate for the San Francisco Bay Area. Ms. Farrell reviewed recent Capital Program activity, from 1999-2000 through 2003- 2004, noting that with the exception of 2000-2001 actual expenditures have been less than budgeted expenditures. This difference was intentional. Because of the threat of loss of ad valorem tax revenue, needed projects were intentionally deferred and over that four-year period the Capital Program was intentionally underspent by approximately $15 million, bringing the Sewer Construction Fund balance at June 30, 2004 to $55 million. This may be considered above the funds required for cash flow, but it is money from needed projects that were intentionally deferred. Ms. Farrell stated that the Capital revenue currently comes from a number of sources, including the Sewer Service Charge, ad valorem tax, capacity fees, and the City of Concord contract. The primary discretionary source of revenue for the Capital Program is the capital component of the Sewer Service Charge and currently accounts for $11.8 million or 50 percent of the Capital revenue. Increases to the Sewer Service Charge Capital Component over the past four years have brought the Capital revenue in line with expenditures assuming receipt of all ad valorem tax. The current Sewer Construction Fund balance provides a buffer for the uncertainty of ad valorem tax revenue. Ms. Farrell stated that Accounting has cautioned that a portion of the Sewer Service Charge currently designated for Capital may have to be reallocated to Operations and Maintenance (O&M) to cover increasing retirement and benefit costs and thus, Capital Program Revenue is still a concern. Currently, the budget for the current year, 2004-2005 CIB, assumed receipt of 50 percent of the ad valorem tax revenue or total Capital revenue of $22.7 million. Recently information has been received from the California Association of Sanitation Agencies (CASA) that it is likely that all the ad valorem tax revenue except 10 percent will be taken. This will result in a negative variance of $5 million as compared to the budgeted negative variance of $4 million. The Sewer Construction Fund balance will then be reduced to approximately $50 million at the beginning of fiscal year 2005-2006. If that occurs, fiscal year 2004-2005 Capital revenue will be about $21.6 million. For the fiscal year 2005-2006 CIB, staff recommends that the baseline of $24.3 million plus an additional $3 million for special projects be budgeted. Under that expenditure scenario. and assuming only $2.5 million in ad valorem tax is received, there would be deficit spending of about $9 million in 2005-2006, bringing the estimated Sewer Construction Fund balance down to $41 million at the end of fiscal year 2005-2006. 11-4-04 88 In response to questions from President Lucey, Ms. Farrell stated that the increase in the Fund balance was from needed projects that have been deferred. It is prudent to proceed with these projects at this time when both funds and staff are available. Ms. Farrell further stated that it is proposed that an additional $3 million per year be spent for the next three years to do some of these necessary projects that have been deferred or that have been recently identified, and that reserves could be spent down to approximately $30 million, the minimum funds required to meet cash flow needs over this three-year period. Ms. Farrell reviewed the expenditures by program, indicating that in 2005-2006 it is recommended that $6 million be budgeted for the Treatment Plant Program, $15.8 million be budgeted for the Collection System Program, $2.2 million be budgeted for the General Improvements Program, and $300,000 be budgeted for the Recycled Water Program for a baseline of $24.3 million. In addition, an extra $3 million would be distributed among the four programs for necessary projects related to the building and facility improvements, the ultraviolet disinfection capacity increase project, the Alhambra Valley sewer, and unbudgeted regulatory- and capacity-driven projects resulting from the wet weather and solids handling planning studies. Ms. Farrell stated that projects of special interest that will be discussed today include the Collection System TV Inspection results in Orinda, and the Plant Operations Division Wet Weather Facility Improvements. By January or February there should be enough information for a status update on the Collection System Operations Division (CSOD) Facilities Plan. That update could be combined with the CSOD update Member Hockett requested and a tour of the facility. Information from the Solids Handling Facilities Plan should be available for a status update in the April 2005 timeframe. There are approximately 8,000,000 total feet of sewer in the District, and about 1,000,000 feet (under 12 inches) have been televised to date as part of the Collection System TV Inspection Program. Orinda was the initial focus of the program because Orinda has about 10 percent of the sewer pipe but 23 percent of the sewer overflows are in Orinda. Ms. Farrell used a graphic to describe the pipe condition scoring system used as part of the TV I nspection Program and reviewed the pipe evaluation flow chart used in prioritizing the work identified. Staff will be available to answer detailed questions on the evaluation methodology after the meeting today, if any Board Members are interested. Ms. Farrell stated that in addition to identifying capital projects, the TV Inspection Program has assisted staff in fine-tuning maintenance activities. The Collection System TV Inspection Program has identified over 200 collection system repairs and construction projects, identified 15 increased frequency cleanings, and discovered two stoppages and three overflows. Correction of these identified deficiencies will reduce overflows. Prior to the Collection System TV Inspection Program, $6.8 million in sewer renovation was planned for Orinda. Now, with the results of the program, $15 million is planned for Orinda over the next five years. Ten percent of all sewers in Orinda (300 different pipe segments) require renovation. Discussion followed with regard to having the General Manager contact the City of Orinda City Council to make a presentation about the amount of money and work that is planned for Orinda. President Lucey and Member Menesini stated that they would accompany staff when that presentation is made. With regard to wet weather issues, Ms. Farrell stated that the capacity limitation of the treatment plant and outfall results in periodic discharge to ponds and increased risk of discharging to the creek. Wet weather flow capacity through ponds and discharge capacity to the creek are limited. An extreme wet weather event will exceed the combined discharge capacity of the outfall and to the creeks. Ms. Farrell reviewed the wet weather flow routing diagram, stating that currently approximately 180 mgd can be passed through the influent pumps and primary treatment, the secondary treatment capacity is approximately 135 mgd and the outfall capacity is 135 mgd, but the ultraviolet (UV) disinfection capacity is limited to 90 mgd. This bottleneck creates a problem. When partially treated influent or sewage goes into the ponds there is 11 -4-04 I I I I I I 89 potential for odors. Once the basins are full, there is a limited amount of flow that can go to the creeks. Additionally, rights to discharge from the basins need to be secured. Ms. Farrell stated that increasing UV disinfection capacity to 135 mgd provides significant value to the District and decreases the risk of flow going into the storage ponds and the creek. Ms. Farrell reviewed model-generated charts showing the effect of treatment/outfall capacity on the frequency of storage use. While it is not possible to predict the future, with each year that goes by the flow increases and the risk of going to the storage ponds and the creek goes up due to increasing flows. Staff recommends that the UV disinfection and hydraulic capacity be increased from 90 mgd to 135 mgd at an estimated cost of $3.5 million. This is a good investment as it allows the District to make full use of the other treatment facilities that are already sized for 135 mgd. It also would minimize flows going to basin storage, reducing odor potential and minimizing the potential for overflows to creeks. Staff will be coming back to the Board to request authorization for a wet weather flow . monitoring contract to look at improvements needed for the wet weather channels on the plant site to increase capacity and ensure that flows can get out of the plant. The estimated cost of an in-plant bypass channel is $1.5 million. Finally, an off site discharge alternative (Pacheco Creek versus Basin B bypass structure to Walnut Creek) will be selected to provide adequate capacity to discharge to the creek. The estimated cost of the Pacheco Creek bypass channel or Basin B bypass could be as much as $2 million. Ms. Farrell stated that we are here today to set a target spending level for the Capital Program that will be carried into the January Financial Planning and Policy Workshop. In summary, it is recommended: . That the baseline investment of $21 million per year (January 2000 dollars) be continued for the next ten years; . That the fiscal year 2005-2006 baseline expenditure is $24.3 million at 3 percent per year inflation; . That for the next three years, an additional $3 million be invested in needed projects, not part of normal replacement and renovation, for a total 2005-2006 Capital Program spending target of $27.4 million; . That the current Sewer Construction Fund balance provides buffer for ad valorem tax uncertainty for the next three years; and . That these Capital Improvement Budget recommendations be included for consideration at the January Financial Planning and Policy Workshop. Ms. Farrell stated that staff will be available following the meeting to answer any technical questions Board Members may have. Discussion followed with regard to the additional investment of $3 million per year for three years, the mechanics of discharging to the creek and the holding capacity of the ponds, the amount of flow that can be routed through the plant, securing authority to discharge to the creek, the fact that the District's National Pollutant Discharge Elimination System (NPDES) permit says that the District may need to discharge into the creek but it is not a permitted discharge, the type and longevity of pipe materials by location, and the geographic necessity of having backyard and easement sewers in the Orinda area. There being no further questions or comments, President Lucey thanked Ms. Farrell and staff for the informative presentation and the written material that was provided in advance. 9. EMERGENCY SITUATIONS REQUIRING BOARD ACTION: None 11-4-04 90 10. ANNOUNCEMENTS/SUGGESTIONS FOR FUTURE AGENDA ITEMS President Lucey requested a brief update on the status of Brown overflow claim in Walnut Creek and the Lower Orinda Pumping Station easement acquisition. In response to a question from Member Nejedly, Mr. Batts stated that the latest indication is that the Regional Water Quality Control Board (RWQCB) will consider the San Ramon Pumping Station overflow at their meeting in January 2005, but the RWaCB may not have a quorum at that meeting. Staff will keep the Board informed. Member Boneysteele requested that President Lucey report to the Board on what he is learning by attendance at the Contra Costa County Employees Retirement Association Board meetings. President Lucey stated that he will be happy to do so. Member Boneysteele requested a report at a future meeting on Proposition 59 relating to Access to Government Information. 11. CLOSED SESSION a. PERSONNEL MA TIERS This item was taken out of order earlier in the agenda. 12. REPORTS OF DISCUSSIONS IN CLOSED SESSION This item was taken out of order earlier in the agenda. 13. ADJOURNMENT There being no further business to come before the Board, President Lucey adjourned the meeting at the hour of 3:38 p.m. President of the Board of Direc rs, Central Contra Costa Sanitary ¡strict, County of Contra Costa, State of California COUNTERSIGNED: 11 -4-04 I I I