HomeMy WebLinkAbout06-07-17 Board Minutes 1
MINUTES OF THE
BOARD OF DIRECTORS MEETING OF THE
OTAY WATER DISTRICT
June 7, 2017
1. The meeting was called to order by President Robak at 3:34 p.m.
2. ROLL CALL
Directors Present: Croucher, Gastelum, Robak, Smith and Thompson
Staff Present: General Manager Mark Watton, General Counsel Daniel
Shinoff, Asst. General Manager German Alvarez, Chief of
Engineering Rod Posada, Chief Financial Officer Joe
Beachem, Chief of Administration Adolfo Segura, Chief of
Operations Pedro Porras, Asst. Chief of Operations Jose
Martinez, District Secretary Susan Cruz and others per
attached list.
3. PLEDGE OF ALLEGIANCE
4. APPROVAL OF AGENDA
A motion was made by Director Croucher, and seconded by Director Thompson
and carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve the agenda.
5. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC
TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE
BOARD'S JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA
Mr. Fayaz Nawabi indicated that he is with the Trustee Advisory Council for the
San Diego Community College District. He stated that the committee that will
handle the recall of Director Gastelum is anticipated to be chartered by the end of
the week. He indicated that the chair of the Committee will be Reverend Jason
Prater and stated that he was looking forward to recalling Director Gastelum in
the next couple months.
6. PRESENTATION ON THE SAN DIEGO COUNTY WATER AUTHORITY vs.
METROPOLITAN WATER DISTRICT LAWSUIT
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Ms. Meena Westford, Special Projects Manager for the Metropolitan Water
District (MWD), presented on achievements that San Diego County Water
Authority (CWA) and her agency have accomplished together and updates on
some of the most important water challenges that our agencies are facing. She
reviewed MWD’s background as a regional water wholesaler with 26 member
agencies and governed by 38 board members. MWD provides services to six (6)
counties covering 5200 square miles. She reviewed their water supply and
storage strategy and presented MWD’s viewpoint on information concerning the
lawsuit between CWA and MWD (see attached presentation). There were
questions from the members of the board and Ms. Westford responded to the
inquiries.
Director Thompson indicated that he did not agree with many of the things that
Ms. Westford indicated was misinformation concerning CWA’s lawsuit with MWD.
He stated that he felt there are significant issues with our whole system of
governance with MWD in general. He indicated the fact there is litigation
between the two agencies is an example of that. He stated he hoped Ms.
Westford’s statement that MWD wanted the agencies to work together will
become a reality as opposed to the current situation where we have to fight out
issues. He thanked her for coming to the District’s meeting as he agrees that we
need to keep the dialogue between the agencies open.
Ms. Maureen Stapleton, General Manager of the CWA, reviewed CWA’s
background and its strategy to diversify supplies to increase water supply
reliability to assure that the County of San Diego would be able to sustain water
deliveries even through drought. She stated by 2016, following the drought in
1991, CWA was able to diversify its supplies to where less than half of its water
supply was coming from MWD (41% in 2016 versus 95% in 1991). She stated
that it is expected that the County of San Diego will diversify its supplies further
and by 2035 only 13% of its water supplies will come from MWD.
She also reviewed the historical rainfall in California and indicated that 2017 was
a record rainfall year which allowed Governor Brown to rescind his January 2014
“Drought State of Emergency” and eliminated the mandatory conservation for all
counties except for four. She noted that during the mandated conservation, the
County of San Diego was able to disregard the conservation requirement due to
the County’s diversification of its water supplies. Ms Stapleton then reviewed the
issues in their lawsuit with MWD (see attached presentation). She noted that
MWD has overcharged San Diego County for water deliveries (please reference
slide 26 of the presentation noting the overcharges to all 24 CWA member
agencies) and the impact to the Otay Water District’s ratepayers alone is an
overcharge of $18.9 million from 2011 to 2014 and $38.1 million from 2011 to
2018. She stated these monies are coming out of the Otay Water District’s
ratepayers’ pocket and subsidizing MWD’s water sales to their other 25 member
agencies.
Ms. Stapleton also reviewed MWD’s financial practices and its impacts to
Southern California ratepayers and their continued practice of overcharging their
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member agencies. She stated that MWD is a critical water agency for California
and our region needs a financially sound organization for the long run. She
stated that CWA wishes to engage public officials and opinion leaders to ask
questions about MWD’s practices:
Why are they draining their reserves?
Why are they borrowing nearly one billion dollars unexpectedly and
unplanned?
Why have they not done a long range financing plan?
Why are they buying property without doing appraisals?
CWA is putting these issues in the spotlight so that solutions can be found. CWA
wishes to resolve its dispute with MWD and wants a sustainable MWD. They are
requesting that Otay Water District support its efforts as it means billions of
dollars to California ratepayers.
Director Croucher suggested that the District consider adopting a resolution
showing its support of CWA’s lawsuit. The Board had comments and asked
questions. Ms. Stapleton responded to the inquiries.
The board recessed at 5:20 p.m. and reconvened 5:31 p.m.
CONSENT CALENDAR
7. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST
IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A
PARTICULAR ITEM:
A motion was made by Director Smith, seconded by Director Thompson and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve the following consent calendar items:
a) AWARD TWO (2) PROFESSIONAL AS-NEEDED CORROSION
ENGINEERING SERVICES CONTRACTS WITH RFYEAGER
ENGINEERING, LLC AND CORRPRO COMPANIES, INC., AN AGEGION
COMPANY, EACH IN AN AMOUNT NOT-TO-EXCEED $577,276 FOR
FISCAL YEARS 2018 AND 2019 [ENDING JUNE 30, 2019]
b) AWARD TWO (2) PROFESSIONAL AS-NEEDED HYDRAULIC
MODELING SERVICES CONTRACTS WITH WATER SYSTEMS
CONSULTING, INC. AND HAZEN AND SAWYER, EACH IN AN
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AMOUNT NOT-TO-EXCEED $175,000 FOR FISCAL YEARS 2018 AND
2019 [ENDING JUNE 30, 2019]
c) ADOPT RESOLUTION NO. 4334 TO CONTINUE WATER AND SEWER
AVAILABILITY CHARGES FOR THE DISTRICT’S CUSTOMERS FOR
FISCAL YEAR 2017-2018 TO BE COLLECTED THROUGH PROPERTY
TAX BILLS
d) ADOPT RESOLUTION NO. 4335 TO ESTABLISH THE TAX RATE FOR
IMPROVEMENT DISTRICT NO. 27 AT $0.004 FOR FISCAL YEAR 2017-
2018
e) APPROVE THE ADDENDUM TO THE FINAL ENVIRONMENTAL
IMPACT REPORT FOR THE OTAY MESA CONVEYANCE AND
DISINFECTION SYSTEM PROJECT
ACTION ITEMS
8. FINANCE AND ADMINISTRATION
a) APPROVE A SECOND AMENDMENT TO THE JOINT POWERS
AGENCY WATER CONSERVATION GARDEN OPERATION
AGREEMENT TO EXTEND THE EXPIRATION DATE AND THE
FUNDING AGREEMENT IN THE AMOUNT OF $96,450 FOR AN
ADDITIONAL 12 MONTHS FROM JUNE 30, 2017 TO JUNE 30, 2018
Communications Officer Tenille Otero indicated that staff is requesting that the
Board approve the second amendment to the Joint Powers Agency Water
Conservation Garden Operation Agreement. Please reference the Committee
Action notes attached to staff’s report (Attachment A) for the details of Ms.
Otero’s report.
The board members made comments supporting the Water Conservation
Garden (WCG). Director Gastelum indicated he was not aware of the existence
of the WCG. He stated, as a condo owner, he does not receive a water bill from
the Otay Water District directly and, thus, does not receive the District’s customer
newsletter. He suggested that the District publish information about the WCG in
all the different developments Homeowners Association newsletters as it would
be a good way to publicize the WCG and their events to both single residential
and multi-residential homeowners.
A motion was made by Director Croucher, seconded by Director Gastelum and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
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to approve staffs’ recommendation.
b) APPROVE THE WATER SYSTEM FEES FROM JULY 1, 2016
THROUGH JUNE 30, 2017 AND AMEND THE DISTRICT’S
PURCHASING MANUAL SECTION 7.2.8.a TO ADD “REGULATORY
FEES” TO STREAMLINE THE DISTRICT’S PROCUREMENT OF
GOODS AND SERVICES
Chief of Water Operations Pedro Porras indicated that staff is requesting that the
board authorize payment of the water system fee to the State Water Resources
Control Board which currently exceeds the General Manager’s authorization level
and amend the District’s Purchasing Manual to add “Regulatory Fees” in Section
7.2.8, Board Authorized Purchases Exceeding the General Manager’s Authority.
Please reference the Committee Action notes attached to staff’s report
(Attachment A) for the details of Mr. Porras’ report.
There was discussion by the board of the State Water Resources Control
Board’s rational for increasing their water system fee by 510%. Following the
discussion a motion was made by Director Thompson, seconded by Director
Croucher and carried with the following vote:
Ayes: Directors Croucher, Robak, Smith and Thompson
Noes: Director Gastelum
Abstain: None
Absent: None
to approve staff’s recommendation and to delegate to the Board President the
forwarding of a letter to the State Water Resources Control Board making them
aware of the District’s concerns with regard to their 510% water system fee
increase.
c) ADOPT ORDINANCE NO. 563 AMENDING SECTION 9, ANNEXATIONS
AND DETACHMENTS; SECTION 28 CONNECTION FEES AND
CHARGES FOR POTABLE OR RECYCLED WATER SERVICE;
SECTION 53, CONDITIONS FOR SEWER SERVICE; AND APPENDIX A
OF THE CODE OF ORDINANCES TO ADJUST THE DISTRICT’S
WATER CAPACITY FEE, NEW WATER SUPPLY FEE, AND
ANNEXATION FEE; CREATE A SEWER CAPACITY FEE AND MODIFY
THE SEWER ANNEXATION FEE, WITH ALL CHANGES TO BE
EFFECTIVE JUNE 7, 2017
Finance Manager Kevin Koeppen requested that the Board adopt Ordinance No.
563 amending Section 9.04.B and 9.04.C.4, Annexations and Detachments;
Sections 28.01.A and 28.01.B, Connection Fees and charges for Potable or
Recycled Water Service; Section 53.03.A.1, conditions for Sewer Service; and
Appendix A of the Code of Ordinances which will update five (5) water fee
charges as noted in staffs’ report. Mr. Tom Gould, HDR Engineering, Inc. was in
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attendance of the meeting to present on the findings of the District’s Rate Study.
Please reference the Committee Action notes attached to staff’s report
(Attachment A) for the details of Mssrs. Koeppen and Gould’s reports.
The board asked questions and staff and Mr. Gould responded to the board’s
inquiries.
Mr. Curt Smith of the HomeFed Corporation indicated that his organization owns
quite a bit of real estate in Otay Ranch and they currently have several
developments that will provide for approximately 13,000 dwelling units plus other
land uses. It is expected that these units will be built over the next 20 years. He
stated that HomeFed Corporation is in support of the meter fee reduction and
that he was in attendance of today’s meeting to discuss the larger homes in their
developments. He indicated that the fixture count in these homes are a little
beyond the Otay Water District’s threshold for a ¾” meter and, thus, require a 1”
meter. Mr. Smith asked if the District could work with his organization and other
developers (the industry) on ways to handle these increments without having to
move to a 1” meter as the cost difference between a ¾” and 1” meter is so great.
General Manager Watton explained that the capacity fee is different than the
calculation of the meter size based on fixture count. He stated that staff would
work and discuss this issue with HomeFed Corporation.
A motion was made by Director Croucher, seconded by Director Smith and
carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None
Abstain: None
Absent: None
to approve staffs’ recommendation.
9. BOARD
a) ADOPT RESOLUTION NO. 4337 OF THE BOARD OF DIRECTORS OF
THE OTAY WATER DISTRICT SUPPORTING EFFORTS TO KEEP THE
TIJUANA RIVER NATIONAL ESTUARINE RESEARCH RESERVE OPEN
In response to an inquiry from Director Smith, Director Thompson clarified that
the funding referenced in the resolution is funding from the Federal government.
The resolution is supporting the continuing of Federal funding for the Tijuana
River National Estuarine Research Reserve.
A motion was made by Director Smith, seconded by Director Thompson and
carried with the following vote:
Ayes: Directors Croucher, Robak, Smith and Thompson
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Noes: Director Gastelum
Abstain: None
Absent: None
to adopt Resolution No. 4337 supporting efforts to keep the Tijuana River
National Estuarine Research Reserve open.
b) DISCUSSION OF 2017 BOARD MEETING CALENDAR
There were no changes to the board meeting calendar.
INFORMATIONAL ITEMS
10. THIS ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL
PURPOSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING
AGENDA ITEM.
a) THIRD QUARTER UPDATE ON THE FISCAL YEAR 2017 CAPITAL
IMPROVEMENT PROGRAM
Engineering Manager Dan Martin provided an update on the District’s third
quarter of FY 2017 Capital Improvement Program. He indicated that the FY
2017 budget is divided into 90 projects totaling $11.8 million. The overall
expenditures through the third quarter is $7.3 million which is approximately 62%
of the FY 2017 budget. Please reference the Committee Action notes attached
to staff’s report (Attachment A) for the details of Mr. Martin’s report.
The board asked questions and staff responded to the board’s inquiries.
REPORTS
11. GENERAL MANAGER’S REPORT
General Manager’s Report
General Manager Watton presented information from his report which included
an update on Cal-Card rebate, SDRMA credit incentive program, 2017 Top Tech
Executive Awards, State Route 94 Campo Road at Melody Road project, school
lead testing program, conservation and water purchases. The board had
comments and questions concerning a few items in the General Manager’s
report and staff responded to the inquiries and comments.
CWA Report
Director Smith reported that CWA is moving water around in their aqueducts in
the north to combat bad water quality. He also noted that CWA’s reservoirs are
filled so they can provide emergency storage for up to six (6) months. He
indicated in an effort to maximize storage, as the State has a large issue with
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storage capacity, CWA has discussed with MWD the possibility of moving water
from northern California to southern California to store the water in all the various
agencies’ reservoirs. MWD declined the offer as they felt it was too hard. He
indicated that it is possible that the State could get involved. He lastly shared
that CWA is presenting its proposed budget for FY 2018 and they indicated that
they will be absorbing some of their cost increases to keep their rate increase to
3.7% for the upcoming fiscal year and is expected the rate increase will be from
3% to 5% in the following fiscal year.
Director Croucher added that CWA will continue with the outreach to Sacramento
and Washington DC in an effort to push this shared storage idea forward in a
positive direction and that he will be traveling to Washington, DC with CWA
representatives. They will be meeting with the Bureau of Reclamation and the
Army Corp of Engineers to review the plans for water storage for both Los
Angeles and San Diego Counties. He also commented on MWD’s budget and
their rebate program. He lastly shared that he, along with other officers of CWA,
attended the ACWA conference in May and CWA won the Clair A. Hill Water
Agency Award of Excellence for their Desalination Project. Along with this
award, a $5000 scholarship with be awarded to a qualified undergraduate
student in San Diego that can be applied to his/her tuition and fees for the
upcoming academic year.
12. DIRECTORS' REPORTS/REQUESTS
Director Smith reported that he attended the District’s regular board meeting,
Engineering Operations and Water Resources Committee meeting, Budget
Workshop/Special Board meeting, Ad Hoc City of San Diego Matters Committee
and the Desalination Project Committee meeting in May. He stated the
Desalination Project Committee reviewed an analysis of the project’s viability
based on different assumptions that were input into a spreadsheet. The
assumptions could be changed in the spreadsheet to see how they impact the
projects feasibility. He noted that a contract still needs to be negotiated, but the
spreadsheet allows the District to determine the range that would make the
project viable.
Director Gastelum indicated that he attended the ACWA Conference in May and
the Joint Powers Insurance Authority (JPIA) made a presentation that seemed to
provide a “win win” situation for the agency, employees and its ratepayers. He
stated that he would like to have the JPIA contact the District to share the
information.
13. PRESIDENT’S REPORT
President Robak reported on meetings he attended during the month of May
2017 (his report is attached). He shared that he met with the lease owners of the
Salt Creek Golf Course and the District’s committee will be meeting to discuss
the status of negotiations with the lease owners. He also shared that General
Manager Watton and he met with San Diego County Supervisor Dianne Jacob
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regarding potential opportunities to share efforts on sewer services and the
County indicated that they had no interest at this time.
14. CLOSED SESSION
The board recessed to closed session at 7:23 p.m. to discuss the following
matters:
a) CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION
[GOVERNMENT CODE §54956.9]
OTAY WATER DISTRICT v. CITY OF SAN DIEGO; CASE NO. 37-2017-
00019348-CU-WM-CTL
The board reconvened at 7:46 p.m. and General Counsel Shinoff reported that
the board met in closed session and took no reportable actions.
15. ADJOURNMENT
With no further business to come before the Board, President Robak adjourned
the meeting at 7:46 p.m.
___________________________________
President
ATTEST:
District Secretary
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President’s Report
Mark Robak
June 7, 2017
Board Meeting
# Date Meeting Purpose
1 2-May Water Conservation Garden Ad Hoc Governence Committee
2 3-May OWD Regular Board Meeting Monthly board meeting
3 4-May Metro JPA Meeting Monthly commission meeting
4 4-5 May P3 Water Summit Discussion of Private Public Partnerships
5 12-May Meeting with Salt Creek Golf
Course ownership Discuss ownership concerns
6 15-May Committee Agenda Briefing
Met with General Manager Watton to
review items that will be presented at the
May committee meetings.
7 17-May Finance, Administration and
Communications Committee
Reviewed items that will be presented at
the June board meeting.
8 18-May
12th Annual Kiwanis Safety
Officer Appreciation Scholarship
Dinner
Represent District at the Event
9 22-May Water Conservation Garden Ad Hoc Governence Committee
10 23-May Desalination Project Committee Reviewed items that will be presented at
the June board meeting.
11 25-May San Diego County Taxpayers
Association Golden Watchdog & Fleece Annual Dinner
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12 24-May OWD Special Board
Meeting/Budget Workshop Discussed proposed budget for FY 2018
13 26-May Interview on KUSI TV Discuss Desalination Project/Presidential
Permit
14 30-May Interview with La Prensa reporter Discuss Desalination Project/Presidential
Permit
15 31-May Interview with Newsweek
reporter
Discuss Desalination Project/Presidential
Permit
16 31-May Interview with Union Tribune
Reporter Discuss City of San Diego lawsuit