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HomeMy WebLinkAboutBOARD MINUTES 04-18-19 -A I CENTRAL SAN -1 -E CENTRAL CONTRA COSTA SANITARY DISTRICT 5019 IMHOFF PLACE, MARTINEZ, CA 9,4553-A392_ MINUTES* BOARD OF DIRECTORS: DAVID R.WILLIAMS REGULAR BOARD MEETING President MICHAEL R AICGILL Board Room President Pro Tem Thursday, April 18, 2019 PAUL CAUSEY 1:30 p.m. JAMESA NEJEDLY TAD J PILECKI Open Session — Board Room (Video recorded) ROLL CALL A regular meeting of the Board of Directors was called to order by President Williams at 1:30 p.m. Secretary of the District Katie Young called roll. PRESENT.- Members: Causey, McGill, Nejedly, Pilecki, Williams ABSENT.- Members: None PLEDGE OF ALLEGIANCE The Board, staff and audience joined in the Pledge of Allegiance. INTRODUCTIONS 1. New employee: • Shaun Mockel, Maintenance Technician II, in the Operations Department, Plant Maintenance Division, effective March 18, 2019 [Continued from April 4, 2019] BOARD ACTION: Welcomed Mr. Mockel. PUBLIC COMMENT PERIOD No comments. REQUESTS TO CONSIDER MATTERS OUT OF ORDER None. These summary minutes are supplemented by a corresponding video recording available on the District's website at centralsan.org. Book 67— Page 61 CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 62 CONSENT CALENDAR 2. Approve the following: a. April 4, 2019 Board meeting minutes 3. Adopt Resolution No. 2019-026 (1) authorizing the Board of Directors to execute an Amendment to a Grant of Easement related to Job 6597; and (2) authorizing staff to record the documents with the Contra Costa County Recorder Member Causey requested a minor correction to an acronym in the April 4 Board meeting minutes. BOARD ACTION: Motion was made by Member Causey and seconded by Member McGill to adopt the Consent Calendar as recommended with the minor correction to the April 4 Board meeting minutes. Motion passed by unanimous vote. PUBLIC HEARINGS 4. Conduct a public hearing to receive comment and consider adopting Uncodified Ordinance No. 304 establishing a schedule of sewer service charge (SSC) rates in accordance with District Code Chapter 6.24.030, increasing the annual SSC for residential and non-residential customers for the next four fiscal years consistent with the table below: FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23 Effective Date July 1, 2019 July 1, 2020 July 1, 2021 July 1, 2022 Average increase 5.25% 5.25% 4.75% 4.75% (all rate categories) Single Family Residence $598 $629 $660 $690 Multi-family Residences $566 $596 $625 $654 Non-residential As shown in the Proposition 218 Notice mailed to property owners (Residential rates shown in dollars per residential unit) General Manager Roger S. Bailey announced the item and provided an introductory overview presentation of Central San's commitments, investments and accomplishments. His remarks were followed by a brief presentation from Communications and Intergovernmental Relations Manager Emily Barnett who reviewed the community outreach that has been conducted by the District with respect to the proposed SSC rate increases. Planning and Development Services Division Manager Danea Gemmell concluded the presentation by reviewing the rate assumptions used to develop Central San's revenue requirements for the next four fiscal years. CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 63 Member Pilecki asked if the ad valorem tax was included in the rate comparison charts. Ms. Gemmell responded that the tax was not included as many agencies do not add to their number to keep the number balanced. Mr. Bailey added that the tax collected, in most cities, gets directed to a general fund and not an enterprise fund. Member Causey pointed out that the future outlay for rate increases has been reduced considerably from previous years. Member Pilecki asked what the cost savings would be if the District were to receive the State Revolving Fund (SRF) loan for the Solids Handling Project. Ms. Gemmell stated that there would be a significant savings on interest rates and the District could potentially save $20 million dollars as part of the program. Ms. Young was asked if any additional protests had been received since the last official count at noon. She said no additional protests were received. Ms. Gemmell then announced that a total of 18 legally valid Proposition 218 protests had been received with regard to the proposed Sewer Service Charge four-year rate increases. Member McGill inquired about a customer assistance program for senior citizens on fixed incomes and hardship discounts. District Counsel Kent Alm stated that such programs are not currently available under Proposition 218 regulations, but a discount can be provided if it is funded by other non-fee revenues such as an ad valorem tax. Proposition 218 establishes that a District cannot charge a person more than the cost of service to benefit others. Member Causey suggested the Finance Committee investigate options to provide a discount for customers. Member Pilecki agreed. Member Williams asked for clarification on the options for rate check-ins. Ms. Gemmell reminded the Board that, should the Board adopt a four-year rate increase, two proposed options include holding a public hearing before the third-year rate increase (Alternative 1), or holding a public hearing every year(Alternative 2) to review rates. It was noted that, should the Board adopt the proposed rates, the public hearing(s) would allow for future rates to be lower than those set forth in the Proposition 218 notice. However, if the Board were to decide that rates higher than those set forth in the Proposition 218 notice were needed, another Proposition 218 notice would need to be distributed. Director of Finance and Administration Philip Leiber provided the Board with reasons to adopt four-year rate increases, including providing business customers with financial planning stability by knowing the amount of future increase rates, and the ability of Central San to respond to remaining uncertainty through various means including timing and amount of debt issuances. Member Pilecki inquired about the cost to produce a Proposition 218 notice. Ms. Barnett stated roughly$68,000, which is largely comprised of first-class postage. She said this amount does not include staff time to prepare the notice. CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 64 Member Causey asked what the cost to produce the customer survey was. Ms. Barnett stated that with three years of trending data, the approximate cost is $30,000. Member Nejedly reminded the Board that those costs do not include staff time; therefore, to send a Proposition 218 notice would most likely cost over $100,000. President Williams opened the public hearing. He stated that three speaker cards were received. Jim Cervantes, resident of Lafayette, stated that he is a participant in Central San's Citizens Academy and has developed a great appreciation for the District in the past weeks. He stated that he appreciates the work the District has completed and believes the proposed rate increases are reasonable. Harrold Helm, resident in Pleasant Hill, complimented the well-designed and informative Proposition 218 notice. He stated that he was in full support of the proposed rate increases. He also inquired how effective the improvements to the collection system have been in reducing infiltration over the time period. The Board and staff participated in an informative discussion on infiltration. Robbie Shergill, Danville resident, stated that the proposed rate increases make sense considering the need for significant capital improvements. He asked if rates will decline once the capital improvements are completed. Mr. Bailey responded that costs and revenue requirements are reviewed every year and for the next 20 years the capital improvement program under the master plan indicates substantial capital investments. Member Causey also noted that concept of intergenerational equity and bond funding go hand in hand because the new capital assets being put in place have a long lifespan. Issuing bonds to pay for those improvements spreads the costs out over a longer period of time among those who will benefit from them. President Williams thanked the public for attending and participating in the hearing. He closed the public hearing. The Board Members began their deliberation. Member McGill complimented staff for keeping the operations and maintenance budget flat and for taking a reasonable and rational approach to the proposed rate increases. He also stated that the issues of customers with fixed incomes having to respond to ever-increasing costs need to be addressed. Motion was made by Member McGill and seconded by Member Causey to find that there was not a majority protest; and to adopt Uncodified Ordinance No. 304 establishing a schedule of SSC rates, in accordance with District Code Chapter 6.24.030, increasing the annual SSC for residential and non-residential customers for the next four fiscal years as specified in the table above. CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 65 Member Pilecki said the District should explore options to subsidize rates for those on fixed incomes. He stated that he and President Williams believe there should be a tear-off card option for Proposition 218 notices and supports making protests as easy as possible for customers. He also noted that the Board has participated in multiple Board and Committee meetings along with Financial Workshops to review the proposed rate increases and that a tremendous amount of time and effort has been spent to develop the rates. Member Pilecki expressed concern about adopting four-year rate increases verses two-year increases given rising construction costs and unfinished condition assessments. Member McGill asked to clarify his motion to approve the four-year SSC rate increases for residential and non-residential customers to include annual public hearings to review the rates each year. Member Causey stated that the District could produce a Proposition 218 notice should a higher rate increase be needed in the future. President Williams stated he was in support of a tear-off option for the Proposition 218 notice but would support the rate increases and that the District always tries to complete projects as cost effectively as possible. BOARD ACTION: Motion was made and clarified by Member McGill and seconded by Member Causey to find that there was not a majority protest; and to adopt Uncodified Ordinance No. 304 establishing a schedule of SSC rates, in accordance with District Code Chapter 6.24.030, increasing the annual SSC for residential and non-residential customers for the next four fiscal years as specified in the table above, including holding annual public hearings (Alternative 2) to review each succeeding year's rates. The motion passed by following roll call vote of the Board: AYES: Members: Causey, McGill, Pilecki, Nejedly, Williams NOES: Members: None ABSTAIN: Members: None 5. Conduct a public hearing to receive comment and consider adopting Uncodified Ordinance No. 305 establishing a "Schedule of Recycled Water Charges" in accordance with District Code Chapter 6.38 increasing the recycled water charge for recycled water customers by 3 percent per year for the next four fiscal years (FY) 2019-20 through FY 2022-23 Ms. Gemmell reviewed the presentation included with the agenda material. President Williams opened the public hearing. There being no public comments, the public hearing was closed. CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 66 Member Pilecki stated that in the future there should be a discussion on increasing rates for recycled water in order to have full cost recovery going forward. Member McGill agreed. President Williams stated that recycled water is being subsidized and that the current rates do not cover the costs of treatment. He would like to see a higher rate increase to reflect the costs. He would also like to entertain having a discussion or workshop to look at the District's long-term goals with recycled water and capturing costs for recycled water treatment. Member McGill supported President Williams concerns of having research conducted to look at the cost of delivering recycled water now and in the future for full cost recovery. BOARD ACTION: Motion was made by Member McGill and seconded by Member Pilecki to find that there was not a majority protest; and to adopt Uncodified Ordinance No. 305 establishing a Schedule of Recycled Water Charges, in accordance with District Code Chapter 6.38, increasing the Recycled Water Charge for Class I (former potable water users) and Class II (former canal/well users) user groups by 3 percent per year for the next four fiscal years and for staff to investigate the full cost of supplying recycled water for future Board discussion. Motion passed by following roll call vote of the Board: AYES: Members: Causey, McGill, Pilecki, Williams NOES: Members: Nejedly ABSTAIN: Members: None Member Nejedly stated he was in support of the 3 percent increase, however, his reason for voting no was that he does not agree with complicating matters associated with researching full recovery costs and whether the District should continue to provide recycled water. He further clarified that this or future Boards may issue a Proposition 218 notice should further rate increases be necessary. LEGISLATIVE MATTERS 6. Receive update on pending legislative matters and provide direction on priority legislation BOARD ACTION: Received the update. REPORTS AND ANNOUNCEMENTS 7. General Manager—Announcements a. Announcements —April 18, 2019 1) Project Bidding for Emergency Sludge Loading Facility Improvements, District Project 7348A CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 67 2) Central San Citizens Academy Final Session on April 30, 2019 3) General Manager Authorized Contracts, Agreements, Etc. - First Quarter 2019 4) Update on Personnel Actions— First Quarter 2019 No further announcements were made during the meeting. BOARD ACTION: Received the announcements. 8. Counsel for the District None. 9. Secretary of the District Ms. Young announced the following upcoming Committee meeting: Finance—Tuesday, April 23 at 2:00 p.m. Ms. Young advised the Board that the Central San Citizens Academy Graduation on April 30 will be noticed as a special meeting because a majority of the Board Members is expected to be present for the question- and-answer session that is a part of the final session. 10. Board Members — Committee Minutes a. March 28, 2019 — Engineering & Operations Committee — Chair Nejedly and Member Pilecki BOARD ACTION: Received the Committee minutes. 11. Board Members - Reports and Announcements Board Member reports on recent meetings or conferences for which they received the stipend or for which the District paid their expenses. a. Member Causey • April 15, 2019 —Attended East Bay Municipal Utilities District briefing Member McGill • April 1, 2019 - Board Liaison meeting with Walnut Creek Mayor and City Manager • April 10, 2019 - Presentation by invitation to Roundhill Garden Club in Alamo regarding recycled water and CoCo San Sustainable Farm (Cancelled) CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 68 • April 15, 2019 - California Special Districts Association - Contra Costa Chapter (CCSDA) Meeting in Walnut Creek • April 15, 2019 - Board Liaison presentation to Pleasant Hill City Council • April 16, 2019 - Board Liaison presentation to Walnut Creek City Council Member McGill also provided a written report covering his announcements and other meetings. Member Neiedly— No report. Member Pilecki — No report. President Williams — No report. BOARD ACTION: Received the reports and announcements. 12. Board Members - Requests for Stipend/Reimbursement or Conference Attendance Authorization to receive a stipend for meeting attendance or expense reimbursement not specifically addressed in the current Board Compensation Resolution, or authorization for conference attendance not previously approved by the Board. No requests. EMERGENCY SITUATIONS None. REQUESTS FOR FUTURE AGENDA ITEMS Member Causey requested a future agenda item regarding the District providing customer assistance to help fixed income seniors and/or hardship cases with paying the annual Sewer Service Charge in the future. Members Pilecki and McGill supported the recommendation. Member Nejedly stated that he was not willing to entertain the subject given that current law prohibits. President Williams concurred. ADJOURNMENT The meeting was adjourned at 3:26 p.m. David R. Williams President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California CENTRAL CONTRA COSTA SANITARY DISTRICT April 18, 2019 Board Meeting Minutes—Book 67-Page 69 COUNTERSIGNED: La-�'K � Katie Young Secretary of the istrict Centrai Contra Costa Sanitary District County of Contra Costa, State of California