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HomeMy WebLinkAbout04.a.2) Approve minutes of regular meeting held April 18, 2013MINUTES OF THE REGULAR MEETING �Q. Z OF THE DISTRICT BOARD OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT HELD ON APRIL 18, 2013 The Board of Directors of the Central Contra Costa Sanitary District convened in a regular meeting in the Board Room, 5019 Imhoff Place, Martinez, County of Contra Costa, State of California, at 2:22 p.m. on Thursday, April 18, 2013. President Nejedly called the meeting to order and requested that the Secretary call roll. 1. ROLL CALL PRESENT: Members: Causey, McGill, Pilecki, Williams, Nejedly ABSENT: Members: None a. PLEDGE OF ALLEGIANCE TO THE FLAG None. The Board and staff joined in the Pledge of Allegiance. 2. PUBLIC COMMENTS 3. CONSENT CALENDAR a. Approve expenditures dated April 18, 2013. Reviewed by Budget and Finance Committee. b. Accept the financial status and budget of the Self- Insurance Fund and approve allocation for Fiscal Year 2013 -14 Operations and Maintenance (O &M) Budget. Reviewed by Budget and Finance Committee. It was moved by Member McGill and seconded by Member Williams to adopt the Consent Calendar as recommended. Motion passed by unanimous vote of the Board. 4. CALL FOR REQUESTS TO CONSIDER ITEMS OUT OF ORDER None. CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 5. PUBLIC HEARINGS CONDUCT PUBLIC HEARINGS ON THE FOLLOWING MATTERS: 1) Consider adopting Uncodified Ordinance No. 276 to replace the "Schedule of Environmental and Development - Related Rates and Charges" adopted pursuant to Ordinance No. 271 in accordance with District Code Chapter 6.30 Provisional General Manager Curt Swanson said that permit, inspection, and other fees, are adjusted annually by ordinance to account for changes in costs. Engineering Assistant III Earlene Millier outlined the timeline for updating the Schedule of Environmental and Development - Related Rates and Charges, including outreach efforts to notify interested parties of the proposed rate changes which, if approved, will become effective July 1, 2013. No letters, email messages or phone calls were received, nor did any customers attend the April 16, 2013 informational meeting for customers. Ms. Millier said the proposed annual adjustments account for changes in salaries, benefits and overhead. A total of 56 fees would increase from 4.7 percent to 11.4 percent. The anticipated revenue from the proposed fee increases would be roughly $100,000 to $150,000 in the coming fiscal year (using the 196 percent administrative overhead rate). Ms. Millier said the staff recommendation was to adopt proposed uncodified Ordinance No. 276 as presented in the agenda packet. In response to a question from Member Causey, Ms. Millier said the decrease in revenue from reducing the administrative overhead rate from 220 percent to 196 percent for these fees is anticipated to be approximately $86,000, based on total revenue of roughly $1 million. Member Causey said that while he had no problem with the proposed fee increases, he was philosophically opposed to using a higher overhead rate for customers than developers. The public hearing was opened and closed without comment. President Nejedly noted that since he has served on the Board, rarely has the District received comments from the community and developers with regard to these annual rate and fee changes. It was moved by Member Williams and seconded by Member McGill to adopt uncodified Ordinance No. 276 to replace the "Schedule of Environmental and Development - Related Rates and Charges" adopted by Ordinance No. 271 in accordance with District Code Chapter 6.30. Motion passed by the following vote of the Board: AYES: Members: McGill, Pilecki, Williams, Nejedly NOES: Members: Causey ABSENT: Members: None 2 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 2) Consider adopting Uncodified Ordinance No. 277 to replace the "Schedule of Capacity Fees, Rates and Charges" adopted pursuant to Ordinance No. 272 in accordance with District Code Chapter 6.12 Senior Engineer Thomas Brightbill explained that capacity fees are one -time "buy -in" fees charged at the time of connection, the proceeds of which are used for capital facility needs. They are adjusted annually via ordinance to avoid larger increases that would be likely for multi -year adjustments. He explained that capacity fees equal the value of assets divided by the number of Residential Equivalent Units (RUEs). The recommended capacity fee increases for Fiscal Year 2013 -14 are 2.3 percent for gravity zones and 1.3 percent for pumped zones. He presented a comparison chart of capacity fees with other local wastewater agencies which placed the District's rates in the mid - range. Mr. Brightbill said the staff recommendation was to adopt proposed uncodified Ordinance No. 277 as presented in the agenda packet. Member Pilecki asked how the value of District assets is calculated. Mr. Brightbill responded that the $1.7 billion asset value used to calculate capacity fees was achieved using one of the methodologies prescribed by the Water Environment Federation (WEF) guidelines. That method involves taking asset purchase prices and then deflating them in accordance with depreciation schedules and inflating them based on the Engineer News Record Construction Cost Index (ENR CCI). The resulting value, while not a true book value, basically represents the value of the asset. Member Pilecki pointed out that true replacement value would yield a much higher figure, closer to $3 billion, which, if used, would result in higher fees. The public hearing was opened and closed without comment. Member Pilecki suggested that other methodologies for calculating the value of assets be analyzed for the future, in part because it could minimize increases in the sewer service charge by increasing the capital component charged to those benefitting from any particular connection, as opposed to passing on that cost to all ratepayers via sewer service charge. President Nejedly said that while he had no problem studying alternative calculation methodologies, he was satisfied with the present method because it maintains more affordable rates for those wishing to connect to the District's sewer system. Member McGill agreed, adding that the current methodology is viewed by developers as fair and equitable, and staff should not devote a great deal of time to analyzing other methodologies. It was moved by Member McGill and seconded by Member Causey to adopt uncodified Ordinance No. 277 to replace the "Schedule of Capacity Fees, Rates and Charges" adopted by Ordinance No. 272 in accordance with District Code Chapter 6.12. Motion passed by unanimous vote of the Board. 3 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 b. CONDUCT PUBLIC HEARING TO CONSIDER WHETHER TO EXTEND THE CONNECTION FEE DEFERRAL PROGRAM CURRENTLY SET TO EXPIRE ON JUNE 30, 2013 Environmental Services Division Manager Danea Gemmell explained that the Connection Fee Deferral Program was implemented in 2009 at the request of the homebuilding community during difficult economic times. Since that time, the program was extended with fees added to cover administrative and interest costs and to limit its application to subdivisions only. Without further Board action, the program will expire June 30, 2013. Ms. Gemmell reviewed program usage. There are currently outstanding $695,640 in deferred fees to one homebuilder, Shapell Homes, which amount is expected to be fully paid by September of this year. She said that the recommendation of staff was to extend the Connection Fee Deferral Program for two more years, through June 30, 2015. The public hearing was opened and closed without comment. In response to a question from Member Williams, Ms. Gemmell said the Program costs roughly $5,000 per year to administer. President Nejedly said he favored extending the program for another two years because the economy is only beginning to recover and the District really has nothing to lose. It was moved by Member McGill and seconded by President Nejedly to adopt Resolution 2013 -009 extending the existing Connection Fee Deferral Program for two more years through June 30, 2015, and continuing the participation fees, finding that special circumstances require suspension from the application of District Code Section 6.08.040 and Subsection 6.12.030D. Motion passed by the following vote of the Board: AYES: Members: McGill, Pilecki, Williams, Nejedly NOES: Members: Causey ABSENT: Members: None 111 1,_ :I . a. AWARD A CONSTRUCTION CONTRACT IN THE AMOUNT OF $107,175 TO CONSOLIDATED NETWORKS CORPORATION, THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER FOR THE HEADQUARTERS OFFICE BUILDING (HOB) IMPROVEMENTS - NETWORK UPGRADES, DISTRICT PROJECT 8234 Provisional General Manager Curt Swanson explained that this project will upgrade existing network cables from CAT 5 to CAT 6 and the fiber optic backbone cables in HOB from 1 gigabyte to 10 gigabytes. The project will be constructed while HOB is vacated for the Seismic Improvements. This scope of this project was originally 0 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 included in the Seismic Improvements project; however, very high bid prices submitted for this portion of work led staff to rebid the work as a separate project. Member Williams said doing this project during the HOB seismic retrofit makes sense. In terms of the District's other needs in the Information Technology (IT) realm, he said he was looking forward to seeing the District's IT Master Plan. Mr. Swanson said work is expected to commence on the new IT Master Plan in the next couple of months. It was moved by Member Williams and seconded by Member Pilecki to award a construction contract in the amount of $107,175 to Consolidated Networks Corporation, the lowest responsive and responsible bidder for the Headquarters Office Building (HOB) Improvements — Network Upgrades, District Project 8234; find that the project is exempt from California Environmental Quality Act (CEQA); and authorize the General Manager to execute the contract documents subject to submittal requirements. Motion passed by unanimous vote of the Board. 7. REPORTS a. GENERAL MANAGER 1) Update on County Quarry clean fill operation on Kiewit propert y Provisional General Manager Curt Swanson stated that County Quarry began the grading operation on the Kiewit property in early March to close out the clean fill site. Environmental Services Division Manager Danea Gemmell provided a brief update on County Quarry's progress stating that, due to recent wind and rainy weather, project completion was expected next week with County approval to follow in May. 2) Update on permit counter connection fee recovery plan and implementation of new procedures to prevent past issues from recurring Provisional General Manager Curt Swanson report that Outstanding Fee Reports run by District staff and an audit report submitted by Bartle Wells Association in March 2012 identified up to $21.4 million in "entered, but uncollected fees" in the District's SunGard enterprise software. By October 2012, staff had completed a detailed review of each of the items and concluded that most of the fees from the report were either erroneous or active work in progress. Staff identified 44 properties with fees totaling $348,900 and has billed property owners for those fees. To date, a little over $156,000 has been collected. The agenda packet included a report on the collection progress and the procedural changes that have been implemented at the permit counter to prevent these types of issues from recurring. Member Williams asked why the District does not collect fees at the time of application, as do most other agencies, rather than at the later "roof and 5 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 ready" stage. He noted that this would alleviate having to implement the permit counter procedural changes and associated interagency coordination. Member McGill said the Board has long held the view that collecting fees at the time properties are connected is the best approach for the District's client base due to high up -front costs associated with new construction. 3) Announcements The following written announcements were included with the agenda packet: a) Public bidding for Suspended Pipe Support Evaluation and Repair, District Project 5955 b) Public bidding for Sewer TV Inspection — Phase 2B, District Project 5948 c) Update on the District's annexation program d) Update on planned natural gas utility outage on April 13 -14, 2013. The following announcement was made at the meeting by Provisional General Manager Curt Swanson: e) Proposition 218 Notices to be mailed starting April 22, 2013 Mr. Swanson said mailing of the Proposition 218 Notices to District ratepayers will begin April 22, 2013 and will be completed by May 3. Also, on Monday, April 22, staff will post the notice on the District's website along with the instructions for filing a protest or submitting comments. b. COUNSEL FOR THE DISTRICT No reports. C. SECRETARY OF THE DISTRICT No reports. d. BOARD MEMBERS 1) Board Member reports on recent meetings for which they received the stipend: and meetings or conferences for which the District paid their expenses; future meetings or conferences for which they will receive the stipend or for which the District will pay their expenses CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 Member Causey Member Causey said he planned to attend the May 2, 2013 Mayors Conference to be hosted by the City of Orinda. Member McGill Member McGill reported on the April 4, 2013 Mayors Conference hosted by the City of Brentwood featuring speaker Steven Weir. He also reported on the April 8, 2013 Contra Costa Council Luncheon which focused on the Contra Costa Poll featuring speaker Alex Evans regarding efforts by local oil refineries to encourage conversation on public policy issues. Member McGill and President Nejedly reported on the April 8, 2013 Enterprise Committee meeting and summarized the Action Summary. The Board received the report without comment. Member McGill reported on the April 15, 2013 Contra Costa Special Districts Association (CCSDA) Chapter Meeting. Member McGill and President Nejedly reported on the April 16, 2013 Budget and Finance Committee meeting and summarized the Action Summary. The Board received the report without comment. 2) Announcements Member McGill provided a written report covering Announcements and other meetings. 8. REAL PROPERTY a. CLARIFY BOARD POSITION REGARDING KIEWIT PROPERTY AND COCO SAN SUSTAINABLE FARM PROPOSAL Provisional General Manager Curt Swanson stated that at the Enterprise Committee meeting held April 8, 2013, President Nejedly asked staff to bring the CoCo San Sustainable Farm Proposal to the Board to determine where the Board Members stand on this matter and how to proceed from this point forward. Environmental Services Division Manager Danea Gemmell gave a brief presentation on the information gathered to date from Environmental Science Associates (ESA), the consulting firm hired by the District to provide clarification on permissible land use options on the Kiewit site. Because of the proximity of the Kiewit property to Buchanan Fields Airport, Ms. Gemmell reviewed maps indicating the airport safety zones and other airport zones (those for noise contours, airspace protection surfaces, and runway protection) within which the Kiewit property falls, each with their own restrictions on 7 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 use of the property. Ms. Gemmell also presented a composite map that divided the Kiewit parcel into sections, designed as Areas 1 through 5, indicating land use options for each area based on the various airport zone restrictions. A large portion of the parcel could be utilized for agricultural purposes, as long as the crops grown do not attract wildlife that could be detrimental to airplanes. The southwest corner of the property, comprised of approximately two level acres, would be suitable for light industrial purposes and could accommodate up to 300 people at any given time. Ms. Gemmell said staff was seeking direction from the Board in terms of how to proceed insofar as future use of the Kiewit property. She recapped the options outlined in the agenda packet, including directing staff to (1) submit the revised CoCo San Sustainable Farm proposal to the Federal Aviation Association (FAA) for determination as to whether it would be permissible; (2) develop an agricultural Request for Proposal (RFP) for the entire site and request that the Farm proponents submit a formal proposal as part of that process; (3) develop a mixed -use RFP for both agricultural and light industrial uses; (4) prepare a draft Master Plan for District properties for Board consideration and development; (5) keep the property vacant for future plant expansion projects or for use in conjunction with a possible Flood Control project or Highway 4/680 interchange construction project anticipated in the next few years; or (6) move in some other direction. In response to a question from Member Williams, Ms. Gemmell said staff time spent on this matter since tracking began (January 24, 2013) has been approximately 140 hours (excluding the most recent pay period, for which time cards had not been processed), which amounts to less than $10,000. An estimated $12,000 to $15,000 will be paid to ESA for its studies with regard to land use options (not necessarily specific to the farm), and seed mix evaluations. Member Williams noted that the District has numerous real property assets and the proper approach for determining how best to utilize those assets would be for the Board to develop a policy on land use. The policy should specifically indicate whether seeking revenues from each property is advisable. At that point, a measured approach to solicit RFPs should be implemented. He said that approach has been circumvented by the farm proponents, some of whom have exerted political pressure on the Board to implement a proposal without all the essential criteria in place. He expressed concern about potential liability to the District if the project were to go forward, and believed much of the managing responsibility ultimately will fall to the District. Member Williams said the farm proposal is a very good concept; the County and other public agencies also think it is a great idea. However, none of those agencies have stepped up to to contribute toward the ESA studies or offered to take the lead on the project. He said the farm project is too far afield from the District's mission and he wished to halt any further work at this time. If the other Board Members did not agree, he said he would be in favor of developing a policy on land use followed by an RFP process to evaluate all potential uses for the Kiewit property. President Nejedly explained that in the past the Board generally has tried to utilize District buffer land and other excess property to generate revenue for the District. The proximity of the Kiewit property to the Highway 4/680 interchange makes it ideally suited as a staging area for a future interchange construction project which 0 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 could generate revenues that would benefit the District's ratepayers, as well as taxpayers in general. Ms. Gemmell noted that the interchange project is expected to involve five phases and last a number of years. Member McGill first commented with regard to Member Williams' remark that the proposed farm project was been approached from the wrong direction. He clarified that a generic proposal for the farm project was crafted by Dr. Carolyn Phinney after a member of District staff suggested the Kiewit site as a possible way to utilize the District's recycled water. Dr. Phinney was then asked to provide more detail on her proposal, which has evolved over the past 15 -18 months with relatively mixed direction from the Board as to how to proceed. He said his interpretation of the Board direction at the February 21, 2013 meeting was to get clarity from airport and land use officials as to exactly what could and could not be done on the property. He said he agreed with President Nejedly that utilizing the property as a highway staging area would be worth looking at, although he questioned whether the entire parcel would be needed for such an activity. In fact, he said it was quite possible that the farm and staging projects would be compatible uses. He suggested that the revised farm proposal be submitted to the Airport Land Use Commission (ALUC) and /or the FAA to determine whether the farm project would be a permissible use of the property. Member Pilecki said if the direction to staff is to get clarification from the FAA and ALUC, it should do so for any possible use envisioned by staff for that site, whether it be farm use, light industrial use, etc. That way it will be clear as to what activities are permissible on the site. With regard to the highway interchange project, he said it is at least four or five years away from commencement of the first phase, but the project is expected to last about ten years. President Nejedly said he was comfortable with the County's request that the District, as property owner, be the party that approaches the FAA and ALUC for clarification on uses for the property. However, he noted that the farm proposal keeps changing, which is confusing and makes it difficult to obtain a definitive response from the airport agencies. Moreover, he said he continues to be concerned about the amount of staff time devoted to this matter. Ms. Gemmell stated that the farm proposal has continued to evolve as Carolyn Phinney has received information about land use restrictions on the property. She suggested that, in the interest of saving time, staff could affix a cover letter to the most recent farm proposal and send it, along with a description of other concepts that ESA has put together, to the airport officials for a determination of which uses would be permissible. Based on the response from airport officials, staff can work with the Board to evaluate all options in support of long -term District goals. President Nejedly said he had no objection to that approach as long as any farm proposal submitted is final. Member Williams said staff would be put in a very difficult position if Ms. Gemmell's suggestion is taken. The Board has taken no vote on whether to allow staff to devote additional time to obtaining clarity on use of the property, putting the onus on CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 staff, who is trying to do the right thing. It also would divert from the District's mission to treat wastewater as cost effectively as possible. He said the highway interchange project has a tangible benefit for the District as well as a clear nexus with the District's core mission, making it an idea worth pursuing. Member McGill said he preferred to obtain clarity from the FAA on whether or not the farm project could be done on the site, which would not exclude pursuit of the interchange idea. He said he believed both potential uses fit the District's mission. District Counsel Kent Alm asked the Board to clarify the direction being given to staff. In response to a question from Member Pilecki, Mr. Swanson said at this point the FAA was looking for a detailed project description from the District rather than an application. At President Nejedly's suggestion, it was the consensus of the Board to direct staff to submit to the appropriate airport representatives the most recent CoCo Sustainable Farm detailed project description from Dr. Phinney, as well as information developed by staff concerning other potential concepts for use of the Kiewit property, in an attempt to define what activities would be allowable on the property. Member Williams clarified that the Board's direction limited staff time devoted to this matter solely to the preparation and mailing of a cover letter. Member Causey commented that he would like to work toward developing a buffer property master plan in the future. b. CONSIDER AUTHORIZING THE GENERAL MANAGER TO ENTER INTO A TWO - YEAR LEASE RENEWAL WITH COUNTY QUARRY PRODUCTS LLC FOR THE CONCRETE AND ASPHALT RECYCLING OPERATION AT 5501 IMHOFF DRIVE (APN 159 - 140 -052) None. None. Provisional General Manager Curt Swanson stated that, based on direction given to negotiators during the Closed Session of the Special Board meeting held immediately prior to this meeting, Item 8.b. was postponed to a future meeting. 9. EMERGENCY SITUATIONS REQUIRING BOARD ACTION 10. SUGGESTIONS FOR FUTURE AGENDA ITEMS 10 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of April 18, 2013 11. ADJOURNMENT There being no further business to come before the Board, President Nejedly adjourned the meeting at 3:30 p.m. James A. Nejedly President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California COUNTERSIGNED: Elaine R. Boehme, CMC Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California 11