HomeMy WebLinkAbout11-06-19 Board Minutes 1
MINUTES OF THE BOARD OF DIRECTORS MEETINGS OF THE OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY November 6, 2019
1. The meeting was called to order by President Thompson at 3:32 p.m.
2. ROLL CALL Directors Present: Croucher, Gastelum, Robak, Smith and Thompson
Staff Present: General Manager Mark Watton, Attorney Jeanne Blumenfeld,
Chief of Engineering Rod Posada, Chief Financial Officer Joe Beachem, Chief of Administration Adolfo Segura, Chief of Operations Pedro Porras, Asst. Chief of Engineering Dan
Martin, Asst. Chief of Finance Kevin Koeppen, District
Secretary Susan Cruz and others per attached list. 3. PLEDGE OF ALLEGIANCE 4. OBSERVE A MOMENT OF SILENCE IN HONOR OF THE LATE UNITED STATES
HOUSE OF REPRESENTATIVE ELIJAH CUMMINGS
A moment of silence was held in honor of the late United State House of Representative Elijah Cummings.
5. APPROVAL OF AGENDA A motion was made by Director Smith, and seconded by Director Croucher and carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None Abstain: None Absent: None
to approve the agenda. 6. APPROVE THE MINUTES OF THE REGULAR BOARD MEETING OF JULY 3, 2019
A motion was made by Director Croucher, and seconded by Director Gastelum and
carried with the following vote:
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Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None Absent: None
to approve the minutes of the regular board meeting of July 3, 2019.
7. 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 No one wished to be heard.
CONSENT CALENDAR
8. 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 Croucher, and 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 the following consent calendar items:
a) AWARD TWO (2) PROFESSIONAL SERVICE CONTRACTS FOR AS-NEEDED ENVIRONMENTAL SERVICES WITH HELIX ENVIRONMENTAL PLANNING, INC. AND ICF JONES & STOKES, INC., EACH IN THE AMOUNT NOT-EXCEED $500,000; THE TOTAL AMOUNT OF THE TWO
(2) CONTRACTS WILL NOT EXCEED $500,000 DURING FISCAL YEARS
2020-2022 (ENDING JUNE 30, 2022) b) AWARD A CONSTRUCTION CONTRACT WITH PIPERIN CORPORATION
FOR THE 1200 PRESSURE ZONE IMPROVEMENTS – PHASE I PROJECT
IN AN ANOMUNT NOT-TO-EXCEED $151,990 c) AWARD TWO (2) PROFESSIONAL SERVICE CONTRACTS FOR AS-NEEDED HYDRAULIC MODELING SERVICES WITH WOOD RODGERS AND WATER SYSTEMS CONSULTING, INC., EACH IN AN AMOUNT NOT-
TO-EXCEED $175,000 FOR FISCAL YEARS 2020 AND 2021; THE TOTAL
AMOUNT OF THE TASKS UNDER THE TWO CONTRACTS WILL NOT EXCEED $175,000
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d) APPROVE CHANGE ORDER NO. 1 TO REDUCE THE CONSTRUCTION CONTRACT WITH ADVANCED INDUSTRIAL SERVICES, INC. IN THE AMOUNT OF $261,330.20 FOR THE 803-2 RESERVOIR
INTERIOR/EXTERIOR COATINGS AND UPGRADES PROJECT e) REJECT ALL BIDS FOR THE CONSTRUCTION OF THE 850-1
RESERVOIR (P2543) AND RECYCLED WATER STORAGE TANK (R2120)
INTERIOR/EXTERIOR COATINGS AND UPGRADES PROJECT f) APPROVE CHANGE ORDER NO. 4 TO THE EXISTING CONSTRUCTION CONTRACT WITH PACIFIC HYDROTECH CORPORATION IN THE AMOUNT OF $49,157.89 FOR THE 870-2 PUMP STATION
REPLACEMENT PROJECT
g) APPROVE AN INCREASE TO THE BUDGET OF CIP P2574 (VISTA VEREDA WATERLINE REPLACEMENT PROJECT) IN AN AMOUNT NOT-
TO-EXCEED $145,000 (FROM $1,640,000 TO $1,785,000); AND,
APPROVE CHANGE ORDER NO. 2 TO THE EXISTING CONSTRUCTION CONTRACT WITH CASS CONSTRUCTION, INC. dba CASS ARRIETA IN AN AMOUNT NOT-TO-EXCEED $115,213.59 FOR THE VISTA VEREDA AND HIDDEN MESA ROAD WATER LINE REPLACEMENT PROJECT
h) APPROVE THE 2019 FIVE-YEAR UPDATE OF THE DISTRICT’S SEWER
SYSTEM MANAGEMENT PLAN i) APPROVE THE PURCHASE OF FIVE (5) FLEET VEHICLES THROUGH
VARIOUS SOUTHERN CALIFORNIA CAR DEALERSHIPS IN THE
AMOUNT OF $223,353.94 j) APPROVE THE ISSUANCE OF A PURCHASE ORDER TO VOLVO CONSTRUCTION EQUIPMENT IN AN AMOUNT NOT-TO-EXCEED $145,155 FOR THE PURCHASE OF ONE (1) PORTABLE EMERGENCY
GENERATOR
k) APPROVE A TWO-YEAR AGREEMENT, PLUS THREE (3) ONE-YEAR OPTIONS, WITH PAYMENTUS TO PROVIDE PHONE PAYMENT
SERVICES IN AN AMOUNT NOT-TO EXCEED $250,000 ($50,000
ANNUALLY) l) ADOPT RESOLUTION NO. 4372 ESTABLISHING POLICY 54, DISCONTINUATION OF WATER SERVICE FOR DELINQUENT ACCOUNTS; AND, ADOPT ORDINANCE NO. 576 TO AMEND SECTION
34, ISSUANCE AND PAYMENT OF WATER BILLS AND APPENDIX A OF
THE DISTRICT’S CODE OF ORDINANCES EFFECTIVE JANUARY 1, 2020
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ACTION ITEMS 9. FINANCE AND ADMINISTRATION
a) APPROVE THE AUDITED FINANCIAL STATEMENTS, INCLUDING THE INDEPENDENT AUDITORS’ UNQUALIFIED OPINION, FOR THE FISCAL YEAR ENDED JUNE 30, 2019 (DYCHITAN)
Senior Accountant Marissa Dychitan requested that the Board approve the Auditied Financial Statements, including the Independent Auditors’ unqualified opinion, for the fiscal year ended June 30, 2019. Please reference the Committee Action notes (Attachment A) attached to the staff report for the details of Ms. Dichitan’s and Mr. Joshua Calhoun’s, Teaman Ramirez and and Smith, reports. Staff responded to
questions and comments from the board.
A motion was made by Director Robak, and 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 staff’s recommendation.
b) ADOPT RESOLUTION NO. 4373 APPROVING THE EXECUTION OF CERTAIN DOCUMENTS AND AUTHORIZING CERTAIN ACTS IN
CONNECTION WITH THE ISSUANCE BY THE OTAY WATER DISTRICT
FINANCING AUTHORITY OF ITS 2019 WASTEWATER REVENUE BONDS IN AN AMOUNT NOT-TO-EXCEED $3,500,000 (FAKHOURI) Finance Manager Eid Fakhouri requested that the Board adopt Resolution No. 4373 authorizing the General Manager and Chief Financial Officer to approve the
execution of certain documents and authorizing certain acts in connection with the
issuance by the Otay Water District Financing Authority of its 2019 Wastewater Revenue Bonds, in an amount not-to-exceed $3,500,000. Please reference the Committee Action notes (Attachment A) attached to the staff report for the details of
Mr. Fakhouri’s and the District’s Municipal Advisor’s, Ms. Suzanne Harrell of Harrelll
& Company Advisors, reports. Also in attendance of the meeting were representatives from Hilltop Securities (Ms. Robin Thomas) who serves as the Underwriter of the bonds and Hawkins Delafield & Wood, LLP (Mr. Sean Tierney) who serves as the Bond and Disclosure Counsel. Staff and Ms. Harrelll responded to questions and comments from the board.
A motion was made by Director Croucher, and seconded by Director Robak and carried with the following vote:
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Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None
Absent: None to approve staff’s recommendation.
10. RECESS OTAY WATER DISTRICT BOARD MEETING AND CONVENE OTAY WATER DISTRICT FINANCING AUTHORITY BOARD MEETING President Thompson recessed the Otay Water District board meeting at 4:03 p.m. and convened the Otay Water District Financing Authority board meeting.
11. ADOPT RESOLUTION NO. 2019-01 APPROVING THE EXECUTION OF CERTAIN
DOCUMENTS AND AUTHORIZING CERTAIN ACTS IN CONNECTION WITH THE ISSUANCE OF 2019 WASTEWATER REVENUE BONDS IN AN AMOUNT NOT-TO-EXCEED $3,500,000 (FAKHOURI)
Finance Manager Fakhouri indicated that this item is a continuation of the previous agenda item. Staff is requesting that the board adopt Resolution No. 2019-01 authorizing the Authority’s Executive Director and the Authority’s Treasurer/Auditor to approve the execution of certain documents and authorizing certain acts in connection with he issuance of 2019 wastewater revenue bonds in an amount not-
to-exceed $3,500,000.
A motion was made by Director Robak, and seconded by Director Gastelum and carried with the following vote:
Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None Absent: None
to approve staff’s recommendation.
12. ADJOURN OTAY WATER DISTRICT FINANCING AUTHORITY BOARD MEETING AND RECONVENE OTAY WATER DISTRICT BOARD MEETING
President Thompson adjourned the Otay Water District Financing Authority board meeting at 4:04 p.m. and reconvened the Otay Water District board meeting. ACTION ITEMS
13. ENGINEERING AND WATER OPERATIONS
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a) APPROVE THE SEPTEMBER 24, 2019 PURCHASE AGREEMENT FOR $508,000 FOR THE CAMPO ROAD AND HILLSIDE DRIVE PROPERTY IN JAMUL
Engineering Manager Bob Kennedy indicated that staff is requesting that the Board approve the September 24, 2019 Purchase Agreement for $508,000 for the Campo Road and Hillside Drive property in Jamul and authorize the General Manager to
enter into escrow to complete the sale of the property. Please reference the
Committee Action notes (Attachment A) attached to the staff report for the details of Mr. Kennedy’s report. There was discussion concerning where the funds from the property sale would be placed. Staff indicated that the original purpose for the property was for a general
yard and stated the funds will be placed in the general fund for various potable and
sewer accounts. The board also suggested possibly placing the funds in a rate stabilization fund or to fund the CalPERS liability.
A motion was made by President Thompson, and seconded by Director Croucher
and carried with the following vote: Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None
Absent: None
to approve staff’s recommendation.
b) REPORT ON FORMING A WORKING GROUP BETWEEN OTAY WATER
DISTRICT AND SWEETWATER AUTHORITY TO EXPLORE THE POTENTIAL AND FEASIBILITY OF USING RECYCLED WATER TO AUGMENT EXISTING LOCAL SUPPLIES AVAILABLE TO OUR MUTUAL CUSTOMERS
Engineering Manager Kennedy indicated that Sweetwater Authority has invited the
District to form a working group to jointly explore the potential and feasibility of using recycled water to augment existing local water supplies available to the customer for both agencies. Please reference the Committee Action notes (Attachment A)
attached to the staff report for the details of Mr. Kennedy’s report.
The board was supportive of forming the working group through the appointment of two board members to a joint task force with Sweetwater Authority. A motion was made by Director Smith, and seconded by Director Croucher and
carried with the following vote:
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Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson Noes: None Abstain: None
Absent: None to appoint Directors Robak and Smith to the joint task force between Otay Water
District and Sweetwater Authority.
President Thompson requested that the task force members provide a report to the board on the work accomplished by the task force in approximately six months. 14. BOARD
a) APPROVE AN AGREEMENT WITH THE LAW FIRM OF ARTIANO SHINOFF ABED BLUMENFELD CARELLI SLEETH & WADE, A PROFESSIONAL CORPORATION, FOR A TERM OF TWO (2) YEARS
THROUGH DECEMBER 31, 2021, TO PROVIDE GENERAL COUNSEL
SERVICES TO THE DISTRICT A motion was made by Director Croucher, and 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 staff’s recommendation. b) DISCUSSION OF 2019 BOARD MEETING CALENDAR District Secretary Susan Cruz indicated that the January 2020 board meeting falls
on January 1 which is a District holiday. She asked if the board would consider
moving the meeting to the following Wednesday, January 8, 2020, at 3:30 p.m. A motion was made by Director Croucher, and 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 move the January 2020 meeting to Wednesday, January 8, 2020, at 3:30 p.m.
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Director Croucher indicated that he will be out-of-town on January 8, 2020 and would be unable to attend the meeting. INFORMATIONAL ITEMS
15. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL PURPOSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING AGENDA
ITEM.
a) REPORT ON THE LATEST ACTUARIAL VALUATION, AS OF JUNE 30, 2019, PERFORMED ON THE NET COST OF THE ENHANCEMENT OF THE RETIREE HEALTHCARE BENEFITS; AND, THE ACTUARIAL EVALUATION DETERMINING THE NET COST OR SAVINGS OF THE
OTHER POST EMPLOYMENT BENEFIT PLAN ENHANCEMENT VERSUS
THE INCREASED EMPLOYEE CONTRIBUTION TO THE CALIFORNIA PUBLIC EMPLOYEE RETIREMENT SYSTEM
Finance Manager Fakhouri provided a report on the latest actuarial valuation
performed as of June 30, 2019 and its findings on the net cost or savings of the Other Post Employment Benefit (OPEB) Plan enhancement against the increased employee contributions to PERS. Mr. Fakhouri introduced the District’s consultant, Mr. Luis Murrillo of Nyhart, who prepared the actuarial report. Please reference the Committee Action notes (Attachment A) attached to the staff report for the details of
Mssrs. Fakhouri and Murillo’s reports.
Director Croucher stepped off the dais at 4:41 p.m. and returned at 4:43 p.m.
It was discussed that through an agreement with the Employees’ Association, the
employees agreed to increase their percentage contribution to CalPERS and this increased payment would be applied to the OPEB Trust Fund. The Trust fund is now fully funded. The annual employee contributions will continue to be made to the OPEB Fund equal to the ADC and the District will reimburse itself for the direct cash payments and implied subsidy for the fiscal year. This approach will ensure
the fund remains 100% funded while withdrawing adequate funds to cover the
annual direct cash payments. The plan was then to use the reimbursed payments to fund the CalPERS liability, which is currently 88% funded.
REPORTS
16. GENERAL MANAGER’S REPORT General Manager Watton presented information from his report which included an update on the Fallbrook PUD and Rainbow MWD detachment from CWA, the
holiday employee event, lobby security enhancements, status of the AMR change
outs, and water conservation, sales and purchases. Staff responded to comments from the board.
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17. SAN DIEGO COUNTY WATER AUTHORITY UPDATE Director Smith reported that CWA is getting Local Resource Projects (LRP)
approved. The LRP for the City of Oceanside and the City of San Diego’s Pure Water Programs were approved by CWA and MWD’s boards to receive funding through the program. He stated this is a milestone as there was a time when LRP
projects were not receiving approval from MWD. He also shared that CWA
approved the Cyclical Storage Agreement which would allow excess water from the Bay Delta to be stored in all California storage reservoirs, which then allows San Diego to take excess water into its storage reservoirs. He lastly shared that CWA approved a position that requires the entities that pollute groundwater will pay for the clean-up of the pollutants. This is also a milestone, as it was formerly the
responsibility of water agencies to pay for such clean-ups.
Director Croucher additionally shared that CWA’s Ad Hoc Fiscal Sustainability Committee is continuing to meet. He stated CWA is meeting with legislators with
regard to opportunities related to the San Vicente Reservoir. He stated the MWD
board will be holding a special board meeting to discuss the rate litigation settlement with CWA in closed session. CWA representatives will not be able to participate in this meeting, but they are continuing to work on the issue. He also shared that CWA is continuing to work on the Fallbrook PUD and Rainbow MWD deannexation issue and it was determined that San Diego LAFCO will handle the
matter. The process will start with a service review, which will include a financial
analysis. He lastly shared that CWA is working on their agricultural rate and are discussing possibly making the agriculture rate discount permanent instead of temporary.
18. DIRECTORS' REPORTS/REQUESTS Director Robak shared from the last LAFCO Special Districts Advisory Committee that the City of Carlsbad Public Works Department filed a request with LAFCO to allow the City to serve a portion of the La Costa Golf Course, as it is within the City
of Carlsbad. Leucadia WD, however, has served the golf course since 1960 and
the problem with the request is that the City cannot provide the service at a lower cost than Leucadia WD. LAFCO, however, has formed a committee to review the request.
Director Gastelum reported that he attended the Spring Valley Fiesta where Otay WD hosted a booth. He stated that it was well attended and it was good to get out with the community. He also stated that he was very pleased to see AB 1588, Drinking Water and Wastewater Operator Certification Program for Veterans, was approved by the legislature.
Director Smith added with regard to AB1588 that he commended staff for the work they did and that it was valuable legislation for the District and the water industry.
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He also shared that he, along with other District members, attended the Otay Mesa Chamber of Commerce event where the Otay WD received an award for Service Provider of the Year. He also shared that he attended, along with Director Gastelum, the State Water Project and Bay-Delta Inspection Tour form October 18
to 19. Director Croucher reported that CWA’s recruitment for a new general manager is
progressing and four (4) candidates are scheduled to be interviewed on November
14, 2020. 19. PRESIDENT’S REPORT President Thompson’s report is attached. He shared with regard to the Water
Conservation Garden (WCG) that he has been elected to serve for the upcoming
year as president to the WCG Joint Powers Authority board. 20. CLOSED SESSION
The board recessed to closed session at 5:33 p.m. to discuss the following matter: a) PUBLIC EMPLOYMENT [GOVERNMENT CODE §54957] TITLE: GENERAL MANAGER b) LIABILITY CLAIMS [GOVERNMENT CODE §54956.95] CLAIMANT: FRANCISCO MONTES DE OCA AGENCY CLAIMED AGAINST: OTAY WATER DISTRICT
c) CONFERENCE WITH LEGAL COUNSEL – POTENTIAL LITIGATION [GOVERNMENT CODE §54956.9] 1 CASE
d) CONFERENCE WITH LEGAL COUNSEL – PENDING LITIGATION
[GOVERNMENT CODE §54956.9] OTAY WATER DISTRICT v. CITY OF SAN DIEGO; CASE NO. 37-2017-
00019348-CU-WM-CTL
21. REPORT ON ANY ACTIONS TAKEN IN CLOSED SESSION. THE BOARD MAY ALSO TAKE ACTION ON ANY ITEMS POSTED IN CLOSED SESSION The board reconvened from closed session at 6:37 p.m. and General Counsel
Jeanne Blumenfeld reported that the board accepted the retirement of General
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Manager Watton on a motion by Director Smith, seconded by Director Thompson and the motion carried with the following vote: Ayes: Directors Croucher, Gastelum, Robak, Smith and Thompson
Noes: None Abstain: None Absent: None
General Counsel Blumenfeld indicated that no other actions were taken by the board in closed session. OTAY WATER DISTRICT FINANCING AUTHORITY
22. NO MATTERS TO DISCUSS
There were no items scheduled for discussion for the Otay Water District Financing Authority board.
23. ADJOURNMENT With no further business to come before the Board, President Thompson adjourned the meeting at 6:39 p.m.
___________________________________
President
ATTEST:
District Secretary
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President’s Report
Mitch Thompson
November 6, 2019
Board Meeting
# Date Meeting Purpose
1 1-Oct SCEDC Board Meeting Represented the District at their Monthly
Meeting
2 2-Oct OWD Regular Board Meeting Monthly Board Meeting
3 8-Oct OWD Special Board Meeting Toured District facilities
4 14-Oct Presidents & GMs Meeting
Regional agencies (Helix WD, Padre Dam
MW, Sweetwater Authority, Lakeside WD
& Otay WD) meeting to discuss items of
mutual interest
5 15-Oct Council of Water Utilities Received a presentation from the State
Water Contractors GM, Jennifer Pierre
6 16-Oct Attended the AB1588 New
Conference
News conference regarding AB1588 being
signed into law
7 17-Oct OWD Employee Apreciation
Luncheon
Appreciation event for the employees of
the District.
8 18-Oct Committee Agenda Briefing
Met w/ General Manager Watton to
review items that will be presented at the
October committee meetings
9 22-Oct Mexican American Business
Professionals Association Represented the District at the meeting
10 23-Oct Finance and Administration
Committee
Reviewed items that will be presented at
the November board meeting
11 30-Oct Water Conservation Garden JPA
Board Meeting Discussed WCG business
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12 30-Oct Otay Chamber 32nd Annual Awards
Dinner Represented the District at the event