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HomeMy WebLinkAboutBOARD MINUTES 06-07-01 146 MINUTES OF THE REGULAR BOARD MEETING OF THE DISTRICT BOARD OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT HELD ON JUNE 7,2001 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 June 7, 2001. President Hockett called the meeting to order and requested that the Secretary call roll. 1. ROLL CALL PRESENT: Members: Nejedly, Menesini, Lucey, Boneysteele, Hockett ABSENT: Members: None a. INTRODUCTIONS . PETE TRAPP. PLANT OPERATOR I . TIFTON GANTT. MAINTENANCE SUPERVISOR . MICHAEL THORNTON. BUILDINGS AND GROUNDS SUPERVISOR Mr. Pete Trapp, Plant Operator I, was introduced and congratulated on his completion of the Plant Operator Trainee Program. Mr. Michael Thornton, Buildings and Grounds Supervisor, was commended on his recent promotion. Mr. Tifton Gantt will be recognized at the June 21, 2001 Board Meeting. 2. PUBLIC COMMENTS None 3. AWARDS AND COMMENDATIONS a. ACKNOWLEDGE PAUL LOUIS FOR RECEIVING THE CALIFORNIA WATER ENVIRONMENT ASSOCIATION (CWEA) SELECT SOCIETY OF SANITARY SLUDGE SHOVELERS AWARD Mr. Charles W. Batts, General Manager, stated that Mr. Paul Louis, Maintenance Supervisor in the Collection System Operations (CSO) Department, has recently been awarded the California Water Environment Association (CWEA) Select Society of Sanitary Sludge Shovelers Award for over five years of significant contributions. Mr. Louis has chaired the Bay Section Collection System Committee and he now serves as the State Chair. Mr. Louis has also been very active in the technical certification program working on the examination, leading classes, and reviewing a formal Study Guide. Only about 200 people in the State of California have received this prestigious award, and the District is proud to recognize Mr. Louis for this achievement. President Hockett and the Board of Directors congratulated Mr. Louis on this noteworthy accomplishment. 4. CONSENT CALENDAR Mr. Batts, General Manager, requested that Item g. be removed from the Consent Calendar. It was moved by Member Lucey and seconded by Member Boneysteele, that the Consent Calendar, consisting of Items. a. through h. excluding Item g. which was removed from O~6 '" ~. .8 ..,! , \\} >~; If'. ~ " "'; '." , /JI' >r 147 the Consent Calendar for discussion, be approved as recommended, resolutions adopted as appropriate, and recordings duly authorized. Resolution No. 2001-069 accepting work and Offers of Easement Dedication at no cost to the District from Shapell Industries of Northern California, on the map of Subdivision 8027, Job 5214, Parcel 1, Glen Bridge, San Ramon area, was adopted and recording was authorized. a. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None Resolution No. 2001-070 accepting work and Offers of Easement Dedication at no cost to the District from Shapell Industries of Northern California, on the map of Subdivision 8135, Job 5302, Parcel 1, Glen Bridge, San Ramon area, was adopted and recording was authorized. b. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None Resolution No. 2001-071 accepting work and Offers of Easement Dedication at no cost to the District from Shapell Industries of Northern California, on the map of Subdivision 8132, Job 5317, Parcel, Crest Bridge, San Ramon area, was adopted and recording was authorized. c. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None Resolution No. 2001-072 accepting work and Offers of Easement Ded ication at no cost to the District from Shapell Industries of Northern California, on the map of Subdivision 8256, Job 5397, Parcel 1, Glen Bridge, San Ramon area, was adopted and recording was authorized. d. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None Resolution No. 2001-073 accepting work and Offers of Easement Dedication at no cost to the District from Braddock and Logan II, on the map of Subdivision 8309, Job 5446, Parcel 3, Walnut Creek area, was adopted and recording was authorized. e. -,r':'. 0,- 148 Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None Resolution No. 2001-074 accepting work and Offers of Easement Dedication at no cost to the District from Braddock and Logan II, Job 5446, Parcel 4, Walnut Creek area, was adopted and recording was authorized. f. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey I Boneysteele, Nejedly, Menesini, Hockett None None June 21, 2001 at 2:00 p.m. was established as the date and time for a public hearing regarding a proposed ordinance to amend District Code Chapter 2.24, Compliance with the California Environmental Quality Act. h. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Boneysteele, Nejedly, Menesini, Hockett None None With regard to Consent Calendar Item g., Mr. Batts stated that an amendment to the position paper has been prepared since it was distributed to the Board. The Rufe property has been removed from District Annexation 156. An amended position has been presented to the Board. It was moved by Member Menesini and seconded by Member Nejedly, that Consent Calendar g. be approved as recommended, and that Resolution No. 2001-075 initiating proceedings to formally annex ten separate areas under the title of District Annexation 156 be adopted. Motion unanimously approved on the following vote: AYES: MEMBERS: NOES: Members: ABSENT: Members: Menesini, Nejedly, Lucey, Boneysteele, Hockett None None 5. HEARINGS CONDUCT PUBLIC HEARINGS TO RECEIVE PUBLIC COMMENTS ON THE 2001- 2002 OPERATIONS AND MAINTENANCE BUDGET AND THE SELF INSURANCE FUND BUDGET AND FOR THE ESTABLISHMENT OF THE 2001-2002. 2002-2003. AND 2003-2004 SEWER SERVICE CHARGE RA rES. AND ON PLACING CURRENT AND DELINQUENT SEWER SERVICE CHARGES ON THE COUNTY TAX ROLL FOR COLLECTION a. President Hockett stated that three separate hearings will be conducted. The purpose of the hearings is to obtain public comment regarding approval of the 2001-2002 Operations and Maintenance (O&M) Budget and Self Insurance Fund Budget and establishment of the ,- ~ ~.:. b.' \..,iJ 't 149 2001-2002, 2002-2003, and 2003-2004 Sewer Service Charge rates; collection of the 2001-2002 Sewer Service Charges on the County tax roll; and collection of delinquent 1997-1999 Sewer Service Charges on the County tax roll. Mr. Batts, General Manager, stated that staff would like to present to the public the highlights of the 2001-2002 O&M Budget and the projections for fiscal years 2002-2003 and 2003-2004. This budget is the culmination of considerable planning, months of effort, and hundreds of hours of staff time. The budget reflects the priorities of the District as discussed with the Board in the January 2001 workshop and at recent Board Meetings. Cost effective operations including a long-term energy conservation program, good customer service, and protecting public assets. This budget represents a 12 percent increase over last year's budget, and up to a 12 percent increase each of the following two years. The Board will decide the actual rate increase through the normal public hearing process. The requested rate increases are based on the existing energy costs, maintaining older facilities and equipment, and the Capital Improvement Program already adopted by the Board. Mr. Batts introduced Ms. Deborah Ratcliff, Controller, who reviewed the 2001-2002 Self Insurance Fund Budget, stating that revenues are budgeted at $492,000 and expenses are budgeted at $892,000, resulting in a decease in reserves of $400,000. At June 30, 2002, the Self Insurance Fund balance is budgeted to be $4,378,437. Ms. Ratcliff stated that the budgets before the Board were calculated based on a proposed Sewer Service Charge increase of $24 per year for up to three years. In the first year, $19 is proposed to be allocated to the O&M Budget and $5 to the Sewer Construction Fund to partially offset the $16 that was transferred to O&M last year. In years two and three, $6 is proposed to be allocated to O&M and the remainder to the Sewer Construction Fund. Ms. Ratcliff reviewed the 2001-2002 proposed, the 2002- 2003 projected, and the 2003-2004 projected O&M Budgets showing that total expenses are projected to increase from $40 million to $44 million and total revenues are projected to increase from $41 million to $44 million. The fund balance by the end of the year will increase minimally from about $4.4 million to $4.7 million. Ms. Ratcliff stated that these are projections. Next year when staff comes back to the Board, these numbers will likely be different when they are updated by current information. Ms. Ann Farrell, Director of Engineering, stated that the Board has already approved the Capital Improvement Budget (CIB). It is being discussed again today because a portion of the funding for the CIB comes from the Sewer Service Charges. Ms. Farrell stated that the focus of her presentation will be on the next three years. Ms. Farrell reviewed the planned Capital Improvement Program expenditures, without the San Ramon projects that the District agreed to escalate as part of the settlement agreement with the City of San Ramon and the developers. The expenditures have been inflated by 3 percent per year, and total $26 million in 2001-2002, $23 million in 2002-2003, and $23 million in 2003- 2004. Because of the recent settlement agreement to escalate the San Ramon projects, an addendum is being prepared and will be brought to the Board for approval. Ms. Farrell reviewed the planned Capital Improvement Program expenditures including the San Ramon projects. The impact on spending will be an increase to approximately $27 million in 2001-2002; an even larger increase to approximately $35 million in 2002-2003; but in the following year, the District will realize the benefit of moving the San Ramon Projects forward and so there will be a reduction in estimated capital spending to approximately $23 million in 2003-2004. The cost of the Dougherty Tunnel and Trunk Sewer Project of $17 million will be funded by the developers, so that has not been included in the bottom line. Ms. Farrell stated that some projects can be deferred, but many have already started or are committed to coordinate with other cities capital programs. Ms. Farrell stated that this is the worst case scenario and staff will be looking at this more closely before bringing an addendum to the Board for consideration. Ms. Farrell reviewed the sources of revenue for the planned Capital Improvement Program included the San Ramon projects and excluding the Dougherty Tunnel and Trunk Sewer Project. The District must rely on Sewer Service Charges to fund an increasing percentage of the Capital Improvement Program since other sources of revenue are not discretionary. A shortfall of $5 million is projected in 2002-2003 and a shortfall of $3 million is projected in 2003- 2004 to fund the San Ramon projects. Staff will be working on financing options. The 6 (: -oc~ ., .. ,< 150 developers have agreed to fund some of those costs for moving the San Ramon projects forward. Mr. Batts provided an overview of the budget and Sewer Service Charge rate setting process which began in August. A notice of the proposed Sewer Service Charge increase of up to $24 per year for up to three years was mailed to 96,655 property owners. In addition the District's Pipeline newsletter featuring information on the proposed Sewer Service Charge increase was mailed to approximately 100,000 customers. The District received a total of 86 responses. Of those 86 responses received, 43 were written responses received either by U.S. mail or electronic mail, and 43 were telephone responses. Of the 86 responses received, 5 supported the proposed increase, 54 opposed the proposed increase, and 27 had questions or left no message. Mr. Batts stated that at this Board Meeting, a public hearing will be held to set the Sewer Service Charge rates. In the coming fiscal years, 2002-2003 and 2003-2004, there will also be a public hearing process. If the Board approves the proposed increase of up to $ 24 per year for up to three years, it will limit the amounts the rates can be raised in those two years and the process will be simplified. Mr. Batts stated that staff has proposed a "soft landing" approach to getting to the break even point matching funds available to funds required. Reserves have steadily been reduced from $ 80 million to the current $40 million level. Because the bulk of the District's income comes at two times during the year, there is a large portion of the year when funds must be available to cover expenses, either by borrowing funds or having funds in reserves to cover those expenses. The energy crisis, the long-term commitment to maintenance of District facilities and equipment, and moving forward the San Ramon projects have created a shortfall that will be with the District for the next few years. The District is trying now to get back on track with the soft landing and stabilize rates so large increases will not be needed in the future. Mr. Batts reviewed the projections Sewer Service Charge, O&M, and Capital projections used in determining the proposed rates for the next three years. If the proposed $24 per year increase is approved for the next three years, funds available will meet funds required criteria for all future years, and the acceleration of the San Ramon projects will require the District to obtain funding from agreements with developers, or obtain bond financing for these projects. If any additional capital work is necessary and capital expenditures go up significantly in year two, funds required will drop well below what is needed and some sort of financing will be required. Mr. Batts provided a Sewer Service Charge comparison of 19 neighboring agencies, ranging from a high of $481 to a low of $113. If the proposed $24 Sewer Service Charge increase were approved, the District's Sewer Service Charge would be $224 and there would be five agencies with lower Sewer Service Charge rates than the District. At the last Board meeting there was extensive discussion about what other agencies are doing to meet the energy crisis and regulatory issues, and the impacts on their Sewer Service Charges. Many of these agencies are facing the same kinds of crisis as the District. As a side note, Mr. Batts stated that a comment letter from Waterkeeper relative to the District's National Pollutant Discharge Elimination System (NPDES) permit renewal, stated that the District's rates are so low compared to other agencies so it would not be a hardship for the District to raise them. Mr. Batts stated that he knows this Board is very concerned about rate increases. The District has had stable rates with no rate increases for six years until last year. Now, staff must recommend that the Board increase rates. It is recommended that the Board authorize a Sewer Service Charge increase of $24 for the 2001-2002 fiscal year; that a Sewer Service Charge increase of up to a maximum of $24 for the fiscal years 2002-2003 and 2003-2004 be approved; and that collection of the Sewer Services on the County tax roll be authorized. At 2:32 p.m., President Hockett opened the public hearing to receive public comments on the 2001-2002 O&M Budget and Self Insurance Fund Budget, and for the establishment of the 2001-2002, 2002-2003, and 2003-2004 Sewer Service Charge rates. Mr. Jerrold Froland, of Martinez, addressed the Board opposing the proposed Sewer Service Charge increase. Mr. Froland stated that the costly environmental system should be revised because it is hurting the country. 06 07 01 151 Mr. Charles Stanis, of Pleasant Hill, addressed the Board, stating that 86 responses to the mailed notice is pitiful. Mr. Stanis questioned why the public hearings are not held in the evening so that more people can attend. Mr. Stanis asked for information concerning funding of the District's recycled water program and how reserve funds are generated. The energy crisis and rate increases are severely impacting seniors on a fixed income. Mr. Stanis requested that the Board consider a subsidy program for seniors since they no longer have children at home and use less water. Mr. John Wolfe, Executive Vice President of the Contra Costa Taxpayers Association, addressed the Board, stating that he does not come to many of these public hearings because generally he thinks that the District is doing a good job. Mr. Wolfe stated that while he does not have any objection to the coming year's O&M Budget and its singular $ 24 proposed increase to take care of energy costs, he does have a problem with the increases proposed for the coming years. Mr. Wolfe stated that he recognizes that the District has spent down the reserves and now needs to raise rates but he does not think the rates increases in years two and three are justified. Mr. Wolfe stated that the District's planning is good but the proposed increases in years two and three are too drastic. Mr. Wolfe suggested that the District borrow rather than increasing rates to create the soft landing recommended. It was noted that the following written correspondence was received and considered by the Board: 2) 3) 4) 5) 6) 1 ) Electronic mail received April 11, 2001 from Mr. Scott Jacobs, 510 Kilburn Court, Clyde, supporting the proposed increase. Electronic mail received April 13, 2001 from Ms. Catherine Mayes, 408 Brandywine Lane, Pleasant Hill, supporting the proposed increase. Letter received April 20, 2001 from Mr. James A. Scanlon, 7306 Barla Place, Carlsbad (owner of 2021 Raphael Court, Walnut Creek), supporting the proposed increase. Postcard received April 12, 2001 from Capt. Bruce Handler, 2 Orchard Court, Orinda, opposing the proposed increase. Letter received April 12, 2001 from Mr. John A. Duncan, 870 Bellons Court, Walnut Creek, opposing the proposed increase. Letter received April 12, 2001 from Mr. and Mrs. Dave Rasmussen, 1580 Siskiyou Drive, Walnut Creek, opposing the proposed increase. 7) Letter received April 12, 2001 from Mr. Peter R. Curtiss, 105 Pleasant Valley Drive, Walnut Creek, opposing the proposed increase. 8) Letter received April 16, 2001 from Mr. Curt J. Cooper, 2460 White Oak Place, Danville, opposing the proposed increase. 9) Letter received May 1, 2001 from Mr. Steve L. Buich, 3738 Meadow Lane, Lafayette, opposing the proposed increase. 10) Letter received May 11, 2001 from Mr. Albert P. Simas, 467 Dalewood Drive, Orinda, opposing the proposed increase. 11 ) Letter received May 25, 2001 from Mr. Barry Redfearne, 1990 Lazy Meadow Lane, Prescott, Arizona, opposing the proposed increase. 12) Letter received May 29, 2001 from Mr. and Mrs. Constantino Spinale, 625 Avalon Avenue, San Francisco, opposing the proposed increase. 13) Electronic mail received April 10, 2001 from Ms. Gail Schwartz, Executive Director, Temple Isaiah, Lafayette, opposing the proposed increase. 06 01 07 152 06 07 14) 15) 16) 17) 18) 19) 20) 21 ) 22) 23) 24) 25) 26) 27) 28) 29) 30) 31 ) 32) 33) 34) Electronic mail received April 10 and 23, 2001 from Michael, Annette, and Brian Shing, Walnut Creek, CA, opposing the proposed increase. Electronic mail received April 11, 2001 from Ms. Tina Bartolo Simpson, opposing the proposed increase. Electronic mail received April 11 and 16, 2001 from Mr. Dean Gettemey, 393 Ridgeview Drive, Pleasant Hill, opposing the proposed increase. Electronic mail received April 11, 2001 from Ms. Denise Navarra, opposing the proposed increase. Electronic mail received April 11, 2001 from Ms. E. Katherine Hall, Walnut Creek, opposing the proposed increase. Electronic mail received April 11, 2001 from Ms. Jill Rubin, opposing the proposed increase. Electronic mail received April 12, 2001 from Mr. John Sallay, opposing the proposed increase. Electronic mail received April 12, 2001 from Mr. George H. Allen, opposing the proposed increase. Electronic mail received April 13, 2001 from Mr. James J. Rogan, opposing the proposed increase. Electronic mail received April 13, 2001 from Mr. and Mrs. Joseph R. Scardino, San Ramon, opposing the proposed increase. Electronic mail received April 13, 2001 from Komperda, 110 Bahama Court, San Ramon, opposing the proposed increase. Electronic mail received April 13, 2001 from Dr. June Gidman, opposing the proposed increase. Electronic mail received April 14, 2001 from M. J. Sandretto, 1201 Alta Vista Drive, # 106, Walnut Creek, opposing the proposed increase. Electronic mail received April 14, 2001 from Mr. and Mrs. Jim Wickens, opposing the proposed increase. Electronic mail received April 15, 2001 from RUKO6, opposing the proposed Increase. Electronic mail received April 15, 2001 from Feitze Papa, 922 Meander Drive, Walnut Creek, opposing the proposed increase. Electronic mail received April 16, 2001 from sabbre, opposing the proposed increase. Electronic mail received April 16, 2001 from Ms. Carol Saltzman, opposing the proposed increase. Electronic mail received April 16, 2001 from Ms. Lois Tsang, 3412 Lanai Drive, San Ramon, opposing the proposed increase. Electronic mail received April 18, 2001 from Mr. and Mrs. Karl Haug, 3068 Bowling Green Drive, Walnut Creek, opposing the proposed increase. Electronic mail received April 18, 2001 from Mr. Steve Swihart, opposing the proposed increase. 01 35) 36) 37) 38) 39) 40) 41 ) 42) 43) 153 Electronic mail received April 22, 2001 from L. G. Elster, 635 Skyline Drive, Martinez, opposing the proposed increase. Electronic mail received April 25, 2001 from Mr. Langley Choy, opposing the proposed increase. Electronic mail received May 2, 2001 from Ms. Sue Gibbons, opposing the proposed increase. Electronic mail received May 10, 2001 from Mr. Ed Bronsen, opposing the proposed increase. Electronic mail received May 31, 2001 from Mr. Jim Roesler, San Ramon, opposing the proposed increase. Facsimile received June 7, 2001 from Ms. Monica E. Venables, 766 Condor Drive, Martinez, opposing the proposed increase. Electronic mail received April 11, 2001 from Ms. Jacqueline Gelder, questioning the time of the public hearing. Electronic mail received April 11, 2001 from Ms. Cyndi Miller, Syufy Enterprises, 150 Pelican Way, San Rafael, CA, requesting information on the proposed increase for non-residential customers. Electronic mail received June 6, 2001 from Mr. Robert L. Mills, 36 Crest View Drive, Orinda, expressing concern that existing ratepayers not subsidize growth and development. There being no further comments, President Hockett closed the public hearing at the hour of 2:48 p.m. Member Nejedly stated that he is taxpayer and he understands the concerns expressed by the speakers. Member Nejedly stated that he was the advocate that specially asked that language be included in the draft ordinance to make sure that the need for the increase in years two and three is reviewed and that the rates be reduced if there are adequate revenues. Approximately 100,000 notes were mailed. Member Nejedly thanked the three people for coming and speaking today. Member Menesini stated that people cannot shop for flushing. The District is required by law to provide public safety with its facilities. Each legal requirement and regulation puts additional costs on the service provided by the District, requiring investment in laboratory work, building pipelines, treatment plant facilities, and many other things. That is not to say that the regulations are not needed because they do provide for public safety. It is what it costs that is passed on to the ratepayers. The District is not a profit making agency. The worst possible position to be in for a Board Member is to have to raise rates. The Board was very glad to go to the ratepayers for a number of years and not raise rates. Perhaps we waited too long and that is why it is necessary to raise rates now. Member Menesini thanked those who spoke for their input, and stated that the main concern of the District and the Board is for the ratepayers and public health, for running a business that is credible and not spending unwisely. Member Lucey stated that he agrees with what has been said by other Board Members about the quality of the District and the value the public gets for its money. Member Lucey stated that he believes a rate hearing should be held every year and that the District should cut into its reserves. Member Lucey stated that he does not like the idea of a three-year rate increase, stating that the ratepayers deserve this sort of analysis every year. Member Boneysteele agreed, stating that what we are doing here is because of notification requirements including expenses in postage and time involved each time a budget is approved. Member Boneysteele stated that the staff position is consistent with 06 07 01 154 what Member Nejedly has asked for that the Board consider the proposed $24 increase separately each year to simplify procedures which staff believes is in the public interest. The District is trying to come up with a balance that meets the requirements of the times and that is operated as efficiently as we can. The District wants to consider each increase as a separate package and if we do adopt this budget this time it is not a self- fulfilling prophesy. These reserves have been accumulated through the years and some is from people just buying into the District and being collected now. I think staff has done a good job in biting the bullet and making three year projections. Staff has done an excellent job. President Hockett stated that the reason for this Board is to do the public's business. It is very difficult for the public to see the big picture in the large scheme of things. This District is incredible in many ways. We are acknowledged for its treatment plant process and protection of the environment and our employees are acknowledged as well. We provide maintenance for 1500 miles of pipes. The District's charge is to maintenance public health and safety and to serve the public for approximately 500,000 citizens and a variety of businesses. It can be a challenge. President Hockett stated that she finds it necessary to increase rates. One of the reasons the District is considering a three-year rate increase is to save money in the future. The District wants to protect public safety and meet the needs of the public and it takes an increase in revenue to do that. President Hockett stated that she is sensitive to the public's concern about rates and taxes. The notice and ordinance will allow a zero increase in years two and three if that is what is needed. There being no further comments, it was moved by Member Menesini and seconded by Member Nejedly, that the 2001-2002 O&M Budget and Self Insurance Fund Budget be approved as recommended; that a $24 increase be approved, setting the 2001-2002 Sewer Service Charge at $224/ that an increase in the Sewer Service Charge rate of up to $24 each year for 2002-2003 and 2003-2004 be established; and that Ordinance No. 21.8 and the findings included therein, be adopted establishing the Sewer Service Charge rate schedules for Fiscal Year 2001-2002, 2002-2003, and 2003-2004. Member Nejedly stated that this rate increase is only for one year and the issue will be brought back to the Board in the second and third years and the increase could be less than $24 in years two and three. Mr. Kenton L. Aim, Counsel for the District stated that the motion for adoption of the draft ordinance sets the rates for the next three years at $224, $248, and $272 respectively; but the ordinance also states that the Board will consider rates in 2002-2003 and 2003-2004 and determine if that increase enacted today is required and if not, an adjustment will be made. Mr. Batts stated that the normal legal notice procedures would be followed in future years including posting and newspaper publication of the notice of public hearing but no individual mailed notices would be sent other than perhaps the District Pipeline newsletter. The above motion approved on the following roll call vote: AYES: Members: Menesini, Nejedly, Boneysteele, Hockett NOES: Members: Lucey ABSENT: Members: None At 3:28 p.m., President Hockett opened the public hearing to receive public comments on collection of the 2001-2002 Sewer Service Charges on the County tax roll. There being no comments, the public hearing was closed. It was noted that using the County tax roll for collection the Sewer Service Charge is more economical than the alternative of direct billing by the District. 06 07 01 155 It was moved by Member Lucey and seconded by Member Menesini, that Resolution No. 2001-076 be adopted, authorizing collection of the 2001-2002 Sewer Service Charges on the County tax roll. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Lucey, Menesini, Nejedly, Boneysteele, Hockett None None At 3:30 p.m., President Hockett opened the public hearing to consider public comment regarding collection of delinquent Sewer Service Charges on the County tax roll. Receipt of a letter dated June 1, 2001 from Diversified Investment and Management Corp. indicated that they do not believe the charges to be valid and asking that the public hearing be put over. There being no further comments, the public hearing was closed. Ms. Deborah Ratcliff, Controller, stated that delinquent Sewer Service Charges happen rarely. Ms. Ratcliff reviewed the delinquent Sewer Service Charge account for Diversified Investments for fiscal years 1996-1997, 1997-1998, and 1998-1999, and the District sewer billing timeline beginning with the first letter request fee payment on March 25, 1999 through the present. No response was received to any of the communications until the June 1, 2001 letter noted above. Ms. Ratcliff stated that in such instances, the District typically puts the delinquent Sewer Service Charges on the County tax roll for collection and ask that a 10 percent penalty be assessed. Ms. Ratcliff recommended that the Board move forward with the recommended action to place the delinquent Sewer Service Charges on the County tax roll for collection. If the property owner pays the delinquent charges, the action to place the delinquent charges on the County tax roll would be stopped. Following discussion of termination of service for non-payment, it was moved by Member Menesini and seconded by Member Nejedly, that Resolution No. 2001-077 be adopted, overruling protests and adopting the report of delinquent Sewer Service Charges pursuant to Section 5473 of the Health and Safety Code, for collection of delinquent Sewer Service of Diversified Investments Charges on the County tax roll. Motion unanimously approved on the following vote: AYES: Members: NOES: Members: ABSENT: Members: Menesini, Nejedly, Lucey, Boneysteele, Hockett None None 6. CALL FOR REQUESTS TO CONSIDER ITEMS OUT OF ORDER Mr. Batts, General Manager, requested that Item 1 O.a., Correspondence, be taken out of order to accommodate interested persons in the audience. There being no objection, President Hockett proceeded to Item 1 O.a., Correspondence. 10. CORRESPONDENCE a. NOTE RECEIPT OF MEMORANDUM DATED MAY 24.2001 FROM DAVID ROLLEY. PRESIDENT OF CENTRAL CONTRA COSTA SANITARY DISTRICT EMPLOYEES' ASSOCIATION. CONCERNING PLANT OPERATORS' PAY Mr. David Rolley, President of Central Contra Costa Sanitary District Employees' Association, addressed the Board relative to Plant Operators' pay. Mr. Rolley stated that he has been a District employee for 20 years. Mr. Rolley stated that we are all here because we share a common affinity for the District. It is a special place because of all 06 07 01 156 the talents and contributions of the various employees that matter and make a difference. The Plant Operators are no exception. They feel the same affinity towards the District; however, they have not felt as rewarded as the rest of the employees. Twenty years ago the District plant was very different. Many additions have been made and the Plant Operators have learned and developed themselves to run this technologically advanced facility. The District's Plant Operators can go anywhere else and operate a plant without training. Other must have extensive training if they come here. The Plant Operators have made it known they want to be recognized. They have tried to do that in negotiations. They were told that the District did not like to do anything for one group in negotiations. They were told the Managers would work with the Plant Operators but nothing happened. Now the Plant Operators are told the District does not want to do anything outside negotiations. Mr. Rolley asked that the Board get the Plant Operators out of this Catch 22. Mr. Rolley asked that a committee of two Board Members meet with the Union and the Managers to learn about this issue and the value of the Plant Operators to this District and other districts. Mr. Rolley distributed a handout comparing the salaries of Plant Operator Ill's at the City of San Francisco, East Bay Municipal Utility District, the City of San Jose, and the District. Mr. Rolley stated that the Plant Operators at the District are not like the Plant Operators at other districts. They are a cut above and they need to be recognized for that. On a daily basis the Plant Operators must make decisions, judgments, and adjustments to operate the plant. It is time they are recognized for it. Member Nejedly stated that he appreciated the presentation but he thinks the timing is poor. These issues should be addressed in Memorandum of Understanding (MOU) negotiations. Salary surveys were done as part of that process. If the employees were not satisfied with those salary surveys, it should have been brought to the Board's attention at that time. If the District enters into negotiations now, the District might as well have continuous negotiations. Mr. Rolley agreed that this should not be done here. Mr. Rolley stated that he tried to address this issue in negotiations and tried to work with management outside negotiations but that did not work. There being no further discussion, President Hockett thanked Mr. Rolley for his comments. BREAK At 3:48 p.m., President Hockett declared a recess, reconvening at the hour of 4:03 p.m. with all parties present as previously designated. At this time, President Hockett reverted to the order of the agenda a. 06 07 7. REPORTS GENERAL MANAGER 1) Mr. Batts, General Manager, introduced Mr. Jim Belcher, Senior Engineer, who stated that this is a dynamic time. The California Public Utilities Commission is requiring all agencies to file for exemption status from rolling blackouts. The District did apply 23 exemption requests, by June 1, 2001, one for each pumping station and the treatment plant to preserve the District's options. Staff will be coming back to the Board at a subsequent Board Meeting with an analysis for the Board's consideration. Both the electric market and the natural gas market have collapsed. The District's cogeneration facility has been able to carry the plant and the Headquarters Office Building for most of the days due to decreases in usage from conservation efforts. Additional natural gas basis for the winter months has been purchased at a cost of $3.35 per decatherm. The District still has half its natural gas requirement to purchase so we are protected against the upside risk. The District has modified its leachate treatment agreement with Acme to allow them to take the condensate to its leachate treatment plant rather than having to flare it. Cogeneration is currently burning a natural gas/landfill gas blend. Mr. Belcher stated energy conservation efforts 01 157 continue. The District will be participating in a PG&E energy benchmarking audit. Interim Director of Administration Jerry Davis put the District in touch with Mr. Larry Asura who had submitted a photovoltaic proposal to the City of Vallejo. The arrangement seems more attractive than previous photovoltaic proposals the District has evaluated and the District is looking into it. Member Lucey stated that he would appreciate having the Board receive the staff recommendation as to whether the District should apply for exemption status from rolling blackouts for the treatment plant and pumping stations. This is a Board policy decision. Member Lucey stated that even if the District could get an exemption, the Board must decide if that is the appropriate thing to do. 2) Mr. Batts, General Manager, introduced Mr. James M. Kelly, Director of Plant Operations, who provided an update on the District's National Pollutant Discharge Elimination System (NPDES) permit renewal. Mr. Kelly stated that on June 4, 2001, Waterkeeper comments were received. On June 7, 2001, there was a Regional Water Quality Control Board (RWQCB) meeting to discuss the District's Tentative Order and remaining issues, and the District hopes to get the final revised Tentative Order on June 7, 2001. On June 20, 2001, the RWQCB public hearing conduct public hearings to consider five Tentative Orders, including the District's. Recent modifications to the District's Tentative Order include indication that the RWQCB has accepted the District's infeasibility requests, incorporated interim limits into the Tentative Order, and incorporated many of the District's comments and corrections into the Tentative Order. Remaining issues include the cyanide site-specific objective, chronic toxicity, dioxin mass limit, ambient monitoring, and interim limits. The order of Tentative Order presentations at the June 20, 2001 RWOCB public hearing is Chevron, Central Contra Costa Sanitary District, San Mateo, Sewage Agency of South Marin, and East Bay Municipal Utility District. Mr. Kelly stated that the only comments that came in this time on the District's tentative order were the Waterkeeper comments. The comments were mostly policy-based issues, concerns with the use of interim limits and corresponding compliance schedules, and the comment concerning the District's rates being low, so additional treatment to meet final limits is feasible, so the compliance schedule is too long. Mr. Kelly stated that it appears the Waterkeeper comments has set them up to appeal the District's permit. The District's comments have been set up to appeal the permit as well. That is a policy decision that the Board may be asked to consider in the future. Mr. Kelly stated that because of the extended period for renewal of the District's NPDES permit has involved significant amounts of time by District staff, District Counsel Kent Aim, and Larry Walker and Associates. The District is reaching the end of the Larry Walker and Associates authorization. It may be necessary for staff to come back to the Board at the next Board Meeting with a request for extension of that contract through completion of the NPDES permit renewal process. 3) Mr. Batts, General Manager, stated that as part of the settlement of the Dougherty Tunnel and Trunk Sewer Project dispute with the City of San Ramon, the City hosted a public meeting with residents of the Estero Drive/Mangos Drive neighborhood on the evening of May 30, 2001. The two-hour meeting was held at the City Hall. Approximately 40 residents attended. District staff described the proposed construction, its sequence and methods, the schedule, and construction impact mitigation based on the settlement framework negotiated with the City. The main issue raised by the residents was the daily work schedule. The City wanted the construction of the trunk sewer portion of the project to be completed by the end of the year. this requires that the contract work sevens days per week from 9:00 a.m. to 6:00 p.m. for open cut work and from 8:00 a.m. 06 07 01 158 06 07 to 8:00 p.m. for microtunneling. The residents want the work to be done five days per week for open cut work and six days per week for microtunneling. They also want the daily work hours shortened to 8:00 a.m. to 5:00 p.m. District staff explained that this revised work schedule may extend the trunk sewer construction. The residents appeared to understand this, expressing a desire or a one day break from construction activity. Other items raised by residents were: . . Pre- and post-monitoring of noise and odor (air quality) levels. coordination with Cal High School for student use of the pedestrian bridge next to the San Ramon (Larwin) Pumping Station. An open house at the San Ramon Pumping Station. Evaluation of multiple construction headings to speed up construction. Providing phone numbers fro emergency and routine contacts to residents. Notifying residents who will have their utilities relocated as part of the construction. Coordinating with other service providers during construction (mail, garbage, etc.). Conducting preconstruction assessments of homes and installing vibration monitors near the microtunneling operations. Ensuring that the contractor maintain cleanliness around the construction areas and that workers do not sit on front yards of the residents. . . . . . . . The District is reviewing these requests and incorporating items into the project contract documents. Many of the requests are mitigation that the District does on all its projects. Mr. Batts stated that the District has not yet received the encroachment permit from the City of San Ramon but hopes to have it soon. 4) Mr. Batts, General Manager, announced that the picnic welcoming summer students will be held on June 29, 2001, at Hidden Valley Park in Martinez. Board Members are invited to attend. The City of Martinez has graciously waived any user fee for the park. 5) Mr. Batts, General Manager, reported that Mr. Mike Vogan, City of Concord Public Works Director, is here today and will be attending District Board meetings when rate or financial issues are on the agenda to provide for better coordination with the District. Director of Engineering Ann Farrell and Controller Debbie Ratcliff continue to meet with the City of Concord to address their issues relating to the wastewater treatment contract. In these meetings it was tentatively agreed that the District would change Concord's billing to an annual bill in arrears for O&M costs with interest charged on the money owed. This has the advantage of giving Concord a one-time credit of approximately $1.5 million against the amount of their current prepayment. This change will be made as an amendment to the current contract. The goal is to have the contract amended so the billing credit is available to Concord by the beginning of the 2002-2003 fiscal year. This will allow Concord to begin its capital program for sewer rehabilitation in July 2002. Staff continues to discuss the remaining issues regarding flow percentage contributions to capital costs. Concord has not yet submitted its formal proposal on the flow percentage issue for District comments. It is expected during the month of July 2001. 6) Mr. Batts, General Manager, announced that there was a major overflow on Saturday, June 6, 2001 in the Blackhawk community in Danville. Mr. Batts described clean up and inspection efforts. It is estimated that no more than 18,000 gallons of sewage overflowed. An inspection of the manholes after the flow cleared revealed a root blockage which had entered through the barrel of a manhole. The line was last cleaned in January 1999 and was not 01 7) 159 scheduled to be cleaned again for ten years. The manhole and adjoining line segment have been put on an annual schedule for reinspection. Mr. Batts, General Manager, updated the Board on the status of the recruitment for the Director of Administration position. b. COUNSEL FOR THE DISTRICT 2) 1 ) Mr. Kenton L. Aim, Counsel for the District, announced that an item has come to the attention of the district subsequent to the deadline for posting the agenda and which requires immediate action. That item concerns the dispute between Acme and NEO and the District relative to how much and to whom payments for landfill gas should be made. An offer was received from Acme after the deadline for posting the agenda. The offer is open only until June 15, 2001 which is before the next regularly scheduled Board Meeting. Mr. Aim stated that Section 54954.2(b)(2) of the Brown Act provides that an item can be added to the agenda by two-thirds vote of the Board, or unanimous vote if less than two-thirds of the Board Members are present, if the item came to the attention of the District subsequent to the deadline for posting the agenda and immediate action is required. It was moved by Member Lucey and seconded by Member Boneysteele, that in accordance with Government Code Section 54954.2(b)(2), the Board of Directors of the Central Contra Costa Sanitary District determines that the issue of the settlement offer concerning payment for landfill gas and the need to take immediate action came to the attention of the District subsequent to the agenda being posted, and that the item be added to the agenda for consideration by the Board in closed session. There being no objection, the motion was unanimously approved. Mr. Aim, Counsel for the District, stated that in accordance with the provisions of the Brown Act, it is appropriate to announce completed actions previously discussed in closed session. Mr. Aim introduced Safety and Risk Manager David Clovis, who announced that based on the authority provided by the Board in closed session, settlement has been reached with regard to the property damage claim for the overflow at 4032 Alhambra Way, Apartments 1 and 2 in Martinez which occurred in March 2001. The total amount of the final settlement for cleanup, restoration, and loss of use for the two families was $43,500. c. SECRETARY OF THE DISTRICT None d. BOARD MEMBERS 2) 1) Member Lucey distributed and reviewed the minutes of the May 24, 2001 meeting of the Sanitation and Water Agencies of Contra Costa County at which Camp Arroyo, a sustainable development, was discussed. Member Nejedly distributed and reviewed the minutes of the May 31, 2001 Household Hazardous Waste Committee meting. Because of the continuing high level of participation and following a customer survey, Member Nejedly stated that the Household Hazardous Waste Committee recommends that the Household Hazardous Waste Collection Facility days and hours of operations be changed to 9:00 a.m. to 4:00 p.m. Tuesday through Saturday. If the Board has no objection, the transition to the new schedule will take place as soon as possible. In addition, Member Nejedly reported that the Household Hazardous Waste Committee endorsed the staff require to add one Senior Household Hazardous Waste Technician position, again because of the continuing high level of participation at the facility. This request would come directly to the full Board for consideration without going 06 07 01 160 first to the Personnel Committee if that is acceptable to the Board. The Board voiced no objection. 3) President Hockett and Member Lucey indicated that they would be unable to attend the July 19, 2001 Board Meeting. Discussion followed with regard to canceling the July 19, 2001 Board Meeting. Following discussion, it was the consensus of the Board that no changes be made to the Board Meeting schedule. 4) Member Menesini announced that he was asked to judge student projects at Northgate High School. Member Menesini stated that he was extremely impressed with the caliber of the student projects. 8. ADMINISTRATIVE a. AUTHORIZE THE GENERAL MANAGER TO EXECUTE PARTICIPATION AGREEMENTS FOR CALIFORNIA SANITATION RISK MANAGEMENT AUTHORITY WORKERS' COMPENSATION AND POOLED LIABILITY PROGRAMS Mr. Batts, General Manager, stated that at the last Board Meeting staff was authorized to obtain a Consent to Self Insure Workers' Compensation liabilities. That certificate has been received from the State of California. The California Sanitation Risk Management Authority (CSRMA) programs have been in place since the mid-1980's and have been very successful to date. The program will provide the District with long-term stability in its cost of insurance and an opportunity to enjoy future savings based on our liability experience. There is an issue with the use of designated counsel in the liability program. That issue will be worked out between District Counsel and the Safety and Risk Manager. Discussion followed with regard to the costs of the program and the use of CSRMA attorneys rather than the District's own attorneys. Following discussion, it was moved by Member Menesini and seconded by Member Nejedly, that the General Manager be authorized to execute participation agreements for the California Sanitation Risk Management Authority Workers' Compensation and Pooled Liability Programs. The motion was approved with Member Lucey voting no. 9. TREATMENT PLANT a. This item was removed from the agenda prior to posting. 10. CORRESPONDENCE a. NOTE RECEIPT OF MEMORANDUM DATED MAY 24.2001 FROM DAVID ROLLEY. PRESIDENT OF CENTRAL CONTRA COSTA SANITARY DISTRICT EMPLOYEES' ASSOCIATION. CONCERNING PLANT OPERATORS' PAY This item was taken out of order earlier in the agenda. b. NOTE RECEIPT OF CALIFORNIA SPECIAL DISTRICTS ASSOCIATION. BOARD OF DIRECTORS - CALL FOR NOMINATIONS. SEAT B. FOR TERM EXPIRING IN 2004 Receipt of the California Special Districts Association, Board of Directors, Call for Nominations, Seat B, for Term Expiring in 2004, was noted. Following discussion, it was moved by Member Menesini and seconded by President Hockett, that the Central Contra Costa Sanitary District support Ms. Sherry Sterrett for reelection to Region 3. There being no objection, the motion was unanimously approved. 11. APPROVAL OF EXPENDITURES a. EXPENDITURE LIST DATED JUNE 7. 2001 06 07 01 161 Member Lucey, Chair of the Budget and Finance Committee, stated that he and Member Nejedly reviewed the expenditures. It was moved by Member Lucey and seconded by Member Nejedly, that the Expenditure list dated June 7, 2001, including Self Insurance Check Nos. 101746-101750, Running Expense Check Nos. 132162-132413, and Sewer Construction Check Nos. 23336- 23380, be approved as recommended. There being no objection, the motion was unanimously approved. 12. BUDGET AND FINANCE a. RECEIVE APRIL 2001 FINANCIAL STATEMENTS Ms. Deborah Ratcliff, Controller, reviewed the results of operations and maintenance for the month of April 2001, noting that expenditures were $49,000 greater than budget, representing a 1.7 percent unfavorable variance. Year-to-date expenditures were $195,000 less than budget, representing a 0.7 percent favorable variance. Year-to-date revenues of $33,496,000 were $415,000 greater than budget, representing a 1.3 percent favorable variance. 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 5.6 percent to 6.8 percent. The latest interest rate as of April 2001 was 3.98 percent. The average yield of the District's LAIF account through March 2001 was 5.97 percent. President Hockett declared that the April 2001 Financial Statements were duly received. 13. EMERGENCY SITUATIONS REQUIRING BOARD ACTION There were no emergency situations other than the urgency closed session item which was added to the agenda. 14. ANNOUNCEMENTS/SUGGESTIONS FOR FUTURE AGENDA ITEMS None 15. CLOSED SESSION a. SIGNIFICANT EXPOSURE TO LITIGATION Pursuant to Government code Section 54956.9(b), a point has been reached where in the opinion of the Board of Directors of the Central Contra Costa Sanitary District, on the advice of its Counsel, based on existing facts and circumstances, there is a significant exposure to litigation against the District. One potential matter is to be discussed. At 5:23 p.m., President Hockett declared the closed session to discuss potential litigation pursuant to Government Code Section 54956.9(b) as noted above. At 5:38 p.m., President Hockett concluded the closed session and reconvened the meeting into open session. 16. REPORT OF DISCUSSIONS IN CLOSED SESSION No decisions were made or votes taken in closed session which require reporting at this time. 17. ADJOURNMENT There being no further business to come before the Board, President Hockett adjourned the meeting at the hour of 5:39 p.m. 06 07 01 06 162 ~~ L/Ci~ Preside~f ~r the Board of Directors, Central Contra Costa Sanitary District, County of Contra Costa, State of California COUNTERSIGNED: Se ar of the Central 0 Sa . ary District, County of Costa, State of California 07 01