HomeMy WebLinkAbout01-21-26 F&A Committee Packet1
OTAY WATER DISTRICT
FINANCE AND ADMINISTRATION COMMITTEE MEETING and SPECIAL MEETING OF THE BOARD OF DIRECTORS
2554 SWEETWATER SPRINGS BOULEVARD SPRING VALLEY, CALIFORNIA BOARDROOM
WEDNESDAY JANUARY 21, 2026 12:00 P.M.
This is a District Committee meeting. This meeting is being posted as a special meeting
in order to comply with the Brown Act (Government Code Section §54954.2) in the event that a quorum of the Board is present. Items will be deliberated, however, no formal board actions will be taken at this meeting. The committee makes recommendations to the full board for its consideration and formal action.
AGENDA
1.ROLL CALL
2.PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TOSPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD’S
JURISDICTION INCLUDING AN ITEM ON TODAY’S AGENDA
DISCUSSION ITEMS
3.AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AMENDMENT TOTHE CONSULTING SERVICES AGREEMENT WITH BURKE, WILLIAMS, &SORENSEN, LLP INCREASING THE NOT-TO-EXCEED AMOUNT BY $50,000,FOR A REVISED TOTAL NOT-TO-EXCEED AMOUNT OF $125,000 (SUZIELAWSON) [5 MINUTES]
4.ADOPT RESOLUTION #4466 AUTHORIZING THE ESTABLISHMENT OF A NEWINVESTMENT ACCOUNT AT NEIGHBORHOOD NATIONAL BANK FOR THEPURPOSE OF PARTICIPATING IN THE CERTIFICATE OF DEPOSIT ACCOUNTREGISTRY SERVICE (CDARS) DEPOSIT INVESTMENT PROGRAM (JON
RAVAGLIOLI) [5 MINUTES]
5.ADJOURNMENT
BOARD MEMBERS ATTENDING:
Jose Lopez, Chair
Delfina Gonzalez
2
All items appearing on this agenda, whether or not expressly listed for action, may be de-liberated and may be subject to action by the Board.
The agenda, and any attachments containing written information, are available at the Dis-trict’s website at www.otaywater.gov. Written changes to any items to be considered at the open meeting, or to any attachments, will be posted on the District’s website. Copies of the agenda and attachments are also available by contacting the District Secretary at (619) 670-2253.
If you have any disability which would require accommodations to enable you to participate in this meeting, please call the District Secretary at 670-2253 at least 24 hours prior to the
meeting.
Certification of Posting I certify that I posted a copy of the foregoing agenda near the regular meeting place of the Board of Directors of Otay Water District, said time being at least 24 hours in advance of the meeting of the Board of Directors (Government Code Section §54954.2).
/s/ Jenny Diaz, District Secretary
STAFF REPORT
TYPE MEETING: Regular Board MEETING DATE: February 4, 2026
PROJECT: Various DIV. NO. ALL
SUBMITTED BY: Suzie Lawson
Human Resources Manager
APPROVED BY: Kevin Koeppen, Chief, Administrative Services
Jose Martinez, General Manager
SUBJECT: AUTHORIZE AN AMENDMENT TO THE CONSULTING SERVICES AGREEMENT
BETWEEN THE OTAY WATER DISTRICT AND BURKE, WILLIAMS & SORENSEN,
LLP AND APPROVE THE TOTAL AMENDED CONTRACT AMOUNT
GENERAL MANAGER’S RECOMMENDATION:
That the Board of Directors (Board) authorize the General Manager to
execute an amendment to the consulting services agreement (Agreement)
by and between the Otay Water District (District) and Burke, Williams
& Sorensen, LLP (Consultant) increasing the not-to-exceed amount by
$50,000, for a revised total not-to-exceed amount of $125,000.
COMMITTEE ACTION:
See “Attachment A.”
PURPOSE:
To obtain Board authorization for the General Manager to execute an
amendment increasing the not-to-exceed amount for the consulting
services agreement by and between the District and the Consultant.
ANALYSIS:
The District has been utilizing the Consultant for ongoing labor matters
since November 2023. The Consultant initially performed legal services
and consultation relating to labor relations, including reviewing the
Memorandum of Understanding (MOU) between the District and the Otay
Water District Employees’ Association (Association) and serving as
Chief Negotiator during 2024 labor negotiations.
AGENDA ITEM 3
Subsequent to the conclusion of the 2024 labor negotiations, it was
determined that additional legal consultation was necessary to assist
in the evaluation of the impact new laws have on the MOU, as well as
District policies and procedures. To maintain consistency and
efficiency in the evaluation of these impacts to the District, the
District entered into an agreement with the Consultant dated July 1,
2025, through June 30, 2026, not-to-exceed $75,000 for services related
to Fiscal Year 2026 ongoing labor and employment matters. The current
not-to-exceed amount of $75,000 was within the General Manager’s
authority. The actual cost of Consultant’s services provided under the
current agreement through November 2025 totaled $51,813. Based on
average actual monthly costs and increases in the quantity and
complexity of sensitive matters being reviewed by the Consultant, staff
requests an increase of $50,000, increasing the not-to-exceed amount
from $75,000 to $125,000. The increase staff is requesting in this
report is due to the impact of changes to laws being more numerous and
complex than anticipated. This increase is necessary to secure legal
consultation for sensitive labor and employment matters through the end
of the current fiscal year.
Based on the aforementioned, staff is requesting that the Board
authorize the General Manager to execute an amendment to the current
agreement in the amount of $50,000 and authorize the revised total not-
to-exceed amount of $125,000.
FISCAL IMPACT: Joe Beachem, Chief Financial Officer
With approval, this amendment will increase the current not-to-exceed
amount by $50,000, revising the total from $75,000 to $125,000. Staff
prepared the Fiscal Year 2026 budget, which included $75,000 for the
related services. Finance has determined that funds are available to
fund the requested increase in the agreement.
LEGAL IMPACT:
None.
ATTACHMENTS:
Attachment A – Committee Action Report
ATTACHMENT A
SUBJECT/PROJECT:
AUTHORIZE AN AMENDMENT TO THE CONSULTING SERVICES AGREEMENT
BETWEEN THE OTAY WATER DISTRICT AND BURKE, WILLIAMS &
SORENSEN, LLP AND APPROVE THE TOTAL AMENDED CONTRACT AMOUNT
COMMITTEE ACTION:
The Finance & Administration Committee reviewed this item at a meeting
held on January 21, 2026. The Committee supports presentation to the
full Board.
NOTE:
The “Committee Action” is written in anticipation of the Committee moving
the item forward for Board approval. This report will be sent to the
Board as a committee approved item or modified to reflect any discussion
or changes as directed by the committee prior to presentation to the
full Board.
STAFF REPORT
TYPE MEETING: Regular Board MEETING DATE: February 4, 2026
SUBMITTED BY: Jon Ravaglioli
Finance Manager
PROJECT: N/A DIV. NO. ALL
APPROVED BY: Joseph R. Beachem, Chief Financial Officer
Jose Martinez, General Manager
SUBJECT: Adopt Resolution No. 4466 Authorizing the Establishment of a
New Investment Account at Neighborhood National Bank
General Manager’s Recommendation
That the Board adopt Resolution No. 4466 authorizing the
establishment of a new investment account at Neighborhood National
Bank for the purpose of participating in the Certificate of Deposit
Account Registry Service (CDARS) deposit investment program.
Committee Action
See Attachment A.
Purpose
To request that the Board review the rationale for opening a new
District bank account and approve the establishment of that account,
pursuant to Section 3 of the District Code of Ordinances, through
adoption of Resolution No. 4466.
Analysis
Neighborhood National Bank
Neighborhood National Bank (NNB) is a local financial institution
designated as a Community Development Financial Institution (CDFI),
reflecting NNB’s commitment to investing in underserved communities.
CDFI banks are different from other financial institutions in their
community development focus and are required to direct at least 60%
of their financing activities toward directly benefiting low- and
moderate-income populations or underserved communities.
AGENDA ITEM 4
Many local agencies currently maintain accounts with NNB, including
Sweetwater Authority and the City of Chula Vista. These agencies
invest in the CDARS program at NNB, earning a return on their
investments while supporting the bank’s efforts within the local
community.
CDARS Programs & Participation
The Certificate of Deposit Account Registry Service (CDARS) is a
program that allows large sums of money to be invested in
certificates of deposit (CDs) while ensuring that funds remain
protected by Federal Deposit Insurance Corporation (FDIC) insurance
coverage. CDARS works by distributing deposits across a network of
banks so that each participating bank holds deposits below the FDIC
insured limit (currently $250,000).
Under the District’s Investment Policy No. 27, Section 8.04, the
purchase of CDs, including those acquired through a CDARS program, is
permitted for up to 15% of the District’s investment portfolio, with
a maximum maturity of five years. All investments are made with the
objective of providing maximum security with the best return, while
meeting the daily cash flow demands of the District.
The District previously held an account at Neighborhood National Bank
to participate in the CDARS program from 2009 to 2012, during which a
12-month investment was rolled over multiple times.
CDARS Returns on Investments
The table below shows quoted pricing from Neighborhood National Bank
and U.S. Treasury yields for comparable terms, as of the same date.
Treasury yields serve as a primary benchmark for CD rates and provide
a reasonable basis for comparing returns. Given the quoted rates,
terms, and amount available for investment, any difference in returns
are expected to be immaterial to the District.
Term CD Rate Treasury Yield
12-month 3.56% 3.53%
24-month 3.51% 3.53%
Administrative Cost of Participating in CDARS
Although the administrative burden associated with CDARS is less than
purchasing and managing individual CDs, there are still costs to
participate in the CDARS program. Initial administrative steps
include opening the account, completing authorization documents,
designating account signers, approving and transferring funds, and
directing investments.
Ongoing responsibilities for staff would include monitoring,
reconciling, and reporting on funds. While these costs are more than
the typical investments by the District, the added cost is not
anticipated to be significant. Ongoing administrative costs will also
be mitigated by limiting the number of transactions.
Board Approval
Pursuant to Section 3.03 of the District Code of Ordinances, the
Board has the authority to establish a new bank account. Staff
recommend that the Board approve the opening of a District bank
account at Neighborhood National Bank.
Fiscal Impact Joe Beachem, Chief Financial Officer
None.
Strategic Goal
The District ensures its continued financial health through long-term
financial planning, formalized financial policies, enhanced budget
controls, fair pricing, debt planning, and improved financial
reporting.
Legal Impact
None.
Attachments: Attachment A – Committee Action
Attachment B – Resolution No. 4466
ATTACHMENT A
SUBJECT/PROJECT:
Adopt Resolution No. 4466 Authorizing the Establishment of
a New Investment Account at Neighborhood National Bank
COMMITTEE ACTION:
RESOLUTION NO. 4466
A RESOLUTION OF THE BOARD OF DIRECTORS OF
THE OTAY WATER DISTRICT
AUTHORIZING THE GENERAL MANAGER TO OPEN AN
ADDITIONAL BANK ACCOUNT
WHEREAS, pursuant to California Water Code Section 60240,
the Otay Water District Board of Directors may authorize the
General Manager to establish an additional alternative
depository.
WHEREAS, Title 5, Division 2, Part 1, Chapter 4, Article 2
of the Government Code authorizes Otay Water District to
deposit, invest, and withdraw funds from a new bank account.
WHEREAS, the Otay Water District aims to open a new bank
account at Neighborhood National Bank.
WHEREAS, Neighborhood National Bank is a local financial
institution designated as a Community Development Financial
institution.
WHEREAS, the role of the new bank account at Neighborhood
National Bank is to participate in the Certificate of Deposit
Account Registry Service deposit investment program.
WHEREAS, the Certificate of Deposit Account Registry
Service purpose of participating in the program at Neighborhood
National Bank permits large sums of money to be invested in
certificate deposits while ensuring the funds are protected by
the Federal Deposit Insurance coverage.
Attachment B
NOW, THEREFORE, BE IT RESOLVED, DETERMINED, AND ORDERED by
the Board of Directors of the Otay Water District that the above
stated recitals are incorporated herein by reference;
BE IT RESOLVED that this resolution shall be in full force
and effect immediately after its passage and approval.
PASSED, APPROVED and ADOPTED by the Board of Directors of the
Otay Water District at a board meeting held this 4th day of
February 2026, by the following vote:
Ayes:
Noes:
Abstain:
Absent:
________________________
President
ATTEST:
____________________________
District Secretary