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Home My WebLink AboutBOARD MINUTES 01-12-23 (Special)LCENTRALSAN MINUTES* SPECIAL BOARD MEETING Virtual Meeting Thursday, January 12, 2023 12:00 p.m. Open Session (Video recorded) NOTICE BOARD OF DIRECTORS: BARBARA D. HOCKETT President MARIAHN. LAURITZEN President Pro Tent MICHAEL R. MCGILL TAD J. PILECKI DAVID R. WILLIAMS This meeting was held virtually pursuant to findings made by the Board of Directors on December 15, 2022 under Assembly Bill (AB) 361 related to the ongoing COVID-19 pandemic. The agenda provided options in which members of the public could participate. ROLL CALL A regular meeting of the Board of Directors was called to order by President Hockett at 12:00 p.m. Secretary of the District Katie Young called roll: PRESENT.- Members: Lauritzen, Pilecki, Williams, Hockett ABSENT.- Members: McGill PLEDGE OF ALLEGIANCE The Board, staff and audience joined in the Pledge of Allegiance. PUBLIC COMMENT PERIOD No comments. FINANCIAL PLANNING WORKSHOP Financial Planning Workshop in which the following will be presented and discussed: These summary minutes are supplemented by a corresponding video recording available on the District's website at centralsan.org. Book 71 — Page 1 CENTRAL CONTRA COSTA SANITARY DISTRICT January 12, 2023 Special Board Meeting Minutes — Book 71-Page 2 • Anticipated Fiscal Years 2023-24 and 2024-25 Capital Improvement Budget and corresponding updated Ten -Year Capital Improvement Plan; • Cost of Service update, including proposed addition of an Accessory Dwelling Unit (ADU) Sewer Service Charge customer category; • Updated Operations and Maintenance budget assumptions for FY 2023-24 and FY 2024-25; and • Sewer Service Charge and Recycled Water rate impact scenarios and proposed implementation schedules General Manager Roger S. Bailey reviewed the objectives and provided a brief overview of the Board's workshop included in the agenda materials. Director of Finance and Administration Phil Leiber and Planning and Development Services Division Manager Danea Gemmell reviewed the presentation included in the agenda materials and responded to several questions from the Board Members. Topics included Current Financial Condition Review (including debt overview), a financial plan update with a look at the Capital Improvement Plan (CIP) Outlook, Capital Improvement Budget (CIB) analysis along with inflation, interest rate update, economic update including the potential for recession, and mitigation efforts applied before arriving at rate proposal. Discussion topics included the status of State Revolving Fund (SRF) loan funding, and the likelihood this funding source will be available for Central San's future projects. Mr. Leiber reviewed the proposed rate term and provided the Board with a two-year and four-year option. He advised that staffs recommendation and preference is two - years given more uncertainty in the project cost and timing outlook among other factors. In response to a question posed by President Hockett, Ms. Gemmell provided the Board with a brief history on the accessory dwelling unit (ADU) rate, presently charged at the multi -family rate, and which would be reduced to about one-half the single-family rate prospectively. Mr. Bailey provided the Board with the summary of key points and requested feedback on the following information from the Board. 1. With regard to addition of the Sewer Service Charge (SSC) ADU residential customer category as a result of the updated Cost of Service study results, direct staff to 1) maintain the status quo; 2) consider staffs recommended updates, or 3) provide some other direction to staff. 2. Establish whether the proposed rate schedule will be for two years (staff recommendation), or four years. CENTRAL CONTRA COSTA SANITARY DISTRICT January 12, 2023 Special Board Meeting Minutes — Book 71-Page 3 3. For purposes of preparing Proposition 218 notices, select preferred rate scenario for: Sewer Service Charge; and Recycled Water Charge. 4. Consider proposed rate cycle timetable, including holding public hearing on rate increases on April 20, 2023, and provide direction to staff as to how to proceed. 5. Provide direction on Rate Stabilization Funding options. Member Williams advised that he is supportive of staffs approach and the two-year rate increase. Member Pilecki agreed with the two-year proposal and proposed having a 3% rate increase of recycled water in the first year and 4 % in the second year to generally match the SSC adjustment figures. Member Lauritzen expressed her preference for a four-year term but recognized the uncertainty regarding the timing of capital improvement projects, so she would defer to staff and go with the recommended two-year term. President Hockett agreed with staffs recommendation for the two-year rate plan as it will provide flexibility and the use of the latest information after the two years. She expressed concerns regarding Member Pilecki's suggestion of raising recycled water rates as customers are using the water and she does not want a negative impact on that consumption. Ms. Gemmell requested feedback on the proposed Proposition 218 notices. She advised that at the next Board Meeting a vote will be taken to approve the notice, so any suggestions were appreciated. Member Pilecki inquired about the outreach done to non-residential customers. Communications and Governmental Relations Manager Emily Barnett provided the Board with a quick summary of the outreach, including the First -Class mailing of the notices and the "soft" notice in Central San's Pipeline which is considering a noticing of customers. This information is also included on all seven channels of the District's social media platforms and the customer service information line. There was a lengthy discussion regarding the ability of customers to protest the proposed adjustments in response to the Proposition 218 notice, including the option of a tear off card to make it easier to respond. Members Pilecki and Williams both were interested in this option. Staff noted the cost and timing implications this would have in this rate cycle. An agreement was reached to review this option again in two years. Mr. Leiber reviewed the rate stabilization funding topic included in the appendix section of the presentation materials. The presentation contained several ways of CENTRAL CONTRA COSTA SANITARY DISTRICT January 12, 2023 Special Board Meeting Minutes — Book 71-Page 4 looking at the adequacy of the funding level, with a summary slide that concluded the current funding level of $7.5 million was in the fair/good range that did not warrant specific concern at this time, but that additional funding could be of value as it may become available. He responded to questions from the Board Members. It was concluded that the funding would be revisited at the end of the fiscal year. BOARD ACTION: Received the information, held discussion and provided feedback to staff. OTHER BOARD ACTION ITEMS 2. Consider renewal of findings pursuant to the Brown Act provisions provided under Assembly Bill 361 to continue the use of teleconference/hybrid participation for Board and Board Committee meetings for a 30-day period effective January 13, 2023 BOARD ACTION: Motion was made by Member Williams and seconded by Member Pilecki to reestablish findings of a state emergency and local health recommendations to continue virtual/hybrid meetings pursuant to Brown Act provisions provided under AB 361 for a 30-day period effective January 13, 2023. Motion passed by unanimous roll call vote of those Board Members present. (4-0-1, McGill absent). ANNOUNCEMENTS 3. General Manaaer —Announcements a. Announcements - January 12, 2023 In addition to the announcement provided with the agenda materials, Mr. Bailey thanked staff for doing a fantastic job during the recent rainstorm. BOARD ACTION: Received the announcements. ADJOURNMENT The meeting was adjourned at 2:39 p.m. baV'6ra. fhdct�t Barbara D. Hockett President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California CENTRAL CONTRA COSTA SANITARY DISTRICT January 12, 2023 Special Board Meeting Minutes — Book 71-Page 5 COUNTERSIGNED: 6 it, Uo Katie Young Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California