VALLEY CENTER MUNICIPAL WATER DISTRICT
Regular Board Meeting
Monday, November 20, 2006
Time: 2:00 P.M.
Place: Board Room
29300 Valley Center Road
Valley Center, CA 92082
The Valley Center Municipal Water District Board of Directors’ meeting was called to order by President Broomell at 2:00 P.M.
ROLL CALL
Board members present were: Directors Broomell, Polito, Aleshire, Stone and Haskell. Staff members present were: General Manager Arant, General Counsel Cowett, Director of Finance Jeffrey, District Engineer Grabbe, Director of Operations Hoyle, Board Secretary Stetson, Project Manager Carrillo, Accounting Manager Pugh, and IT Specialist Learue. Spectators present were: Messrs. Muir, McGinness and Ross.
CONSENT CALENDAR
1. Upon motion by Stone, seconded by Polito and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held November 6, 2006
• Audit demand check numbers 110958 through111134
• Approval of Purchase Order No. 16703 to Electrical Sales, Inc. in the amount of $79,417.16 for the purchase of pump starter replacements for Oathill 1-6 and Betsworth 9-14 as had been approved in the FY 2006-08 budget
ACTION AGENDA
2. Contract Amendment No. 3 with TMV Systems Engineering, Inc. for SCADA Project Construction Management and System Integration Services:
District Engineer Grabbe requested Board authorization of Amendment No. 3 to the contract with TMV Systems Engineering, Inc. for additional work on the SCADA Project Construction Management and System Integration Services for Phases 1 and 2, Design Services for Phases 3 and 4 and minor additional work for other related projects. The requested amendment to the contract would add the following tasks:
● Modifications to Phase 1 & 2 design and electrical record drawings
● Add construction management and system integration for Phases 1 & 2
● Add design for Phases 3 & 4 including electrical record drawings
● Additional work items for various related projects (Sherwood Ridge Pump Station, Couser Pump Station, Moosa Aeration Project, Lake Turner Gauging Station and System Maintenance)
The current contract with TMV Systems Engineering, Inc. for the SCADA Project is for $1,101,492. Approval of the above tasks would increase the authorized contract by a not to exceed amount of $404,398 or the current contract amount to $1,505,890.
District Engineer Grabbe clarified that no additional funding is being requested as funds were allocated in the District’s budget for TMV Systems Engineering services for the next phases of the SCADA Project, and other projects requiring SCADA integration and electrical design services.
Upon motion by Aleshire, seconded by Polito and unanimously carried, the following resolution, approving Amendment No. 3 to the contract with TMV Systems Engineering, Inc. for $404,398, entitled:
RESOLUTION NO. 2006-48
RESOLUTION OF THE BOARD OF DIRECTORS
OF VALLEY CENTER MUNICIPAL WATER
DISTRICT FOR AMENDMENT NO. 3 TO THE
TMV SYSTEMS ENGINEERING CONTRACT FOR
SYSTEM INTEGRATION OF THE SCADA PROJECT
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
3. Award of Contract and Budget Amendment for the Couser Way Pipeline Relocation Project:
Bids were opened on November 7, 2006, for the Couser Way Pipeline Relocation Project in which the lowest bid received was from NEWest Construction Co. at $177,626.00. District Engineer Grabbe reviewed that the engineer’s estimate for this project had been $150,000 and the current project budget is $250,000 for the design and construction. Board adoption of Resolution No. 2006-45 to award the contract to NEWest Construction Co. and amend the 2006-07 budget to appropriate an additional $30,000 for this project was recommended. Also, adoption of Resolution No. 2006-46 to declare the intent to reimburse expenditures for this project from proceeds of indebtedness was recommended.
Upon motion by Aleshire, seconded by Polito and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2006-45
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
AWARDING CONTRACT FOR THE COUSER WAY
PIPELINE RELOCATION PROJECT AND AMEND-
ING THE FISCAL YEAR 2006-07 BUDGET BY
APPROPRIATING AN ADDITIONAL $30,000
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
Upon motion by Aleshire, seconded by Polito and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2006-46
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
MAKING A DECLARATION OF OFFICIAL INTENT
TO REIMBURSE EXPENDITURES FROM
PROCEEDS OF INDEBTEDNESS
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
4. Resolution Approving Award of Purchase Order for Booster Pumps at the Via Cantamar Reservoir:
Resolution No. 2006-47 to approve Purchase Order No. 16671 in the amount of $47,410 to Barrett Engineered Pumps for acquisition of a water pressure booster
pump unit for the Via Cantamar Project was presented for the Board’s adoption. The resolution also makes a declaration of official intent to reimburse expenditures for this project from proceeds of future indebtedness.
Project Manager Carrillo reviewed that three quotes for a skid mounted pump unit complete with five single phase booster pumps, pump controls, suction and discharge headers and valves were received. The lowest quote submitted was from Barrett Engineered Pumps at $47,410. District forces will be installing the equipment and commissioning the pump station. The total project budget is $354,400. The water booster pump unit for the Via Cantamar Reservoir will enhance the water pressure for properties served by the reservoir.
Upon motion by Polito, seconded by Aleshire and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2006-47
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
AWARDING PURCHASE ORDER 16671 FOR
THE VIA CANTAMAR PUMP STATION PROJECT
AND MAKING A DECLARATION OF OFFICIAL
INTENT TO REIMBURSE EXPENDITURES FROM
PROCEEDS OF INDEBTEDNESS
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
5. Review of the Notices and Preparations to Conduct a Public Hearing on the Proposed Water and Wastewater Rate Increases for 2007:
General Manager Arant reviewed that with the adoption of the Fiscal Years 2006-07 and 2007-08 budget, rate adjustments had been discussed that would take effect in early 2007 to offset increases in wholesale water costs, power costs and general inflationary impacts. Direction from the Board regarding including consideration for increased pre-funding of the Retirees Health Benefit Plan in the pending rate action will be requested.
Director of Finance Jeffrey explained the process to implement the proposed rate increase to be in compliance with the court ruling (Big Horn Case) which held that
water and sewer rates are subject to the notification and referendum provisions of Proposition 218. He noted that the District will be required to provide a proposed rate increase notification to all landowners and water/sewer customers within the District’s service area, and hold a public hearing on the proposed rates. Said notices must be mailed at least 45 days in advance of the hearing date and the adopted rates can become effective no sooner than 30 days from date of adoption. At the December 4, 2006, Board meeting, the Notice to be mailed to all landowners and customers of the District will be presented for the Board’s approval. Approximately 31,000 notices will be mailed to comply with the provisions of Proposition 218 as it will be mailed to all District customers, including time share condominium owners, landowners and tenants. The cost for said mailing is estimated at $20,000, and the notices are expected to be mailed by December 8th with the public hearing to consider the revised water and wastewater rates to be conducted at an adjourned regular meeting on January 29, 2007. The new rates would become effective with the March 1, 2007, bills.
General Manager Arant reported that subsequent to the adoption of the current budget, an actuarial report indicated that there is a need to increase funding of the District’s Retirees Health Benefit Program to avoid a long-term unfunded liability. It was recommended that pre-funding of the Program begin in FY 2007-08 and identified a range of funding levels from 11.5% to 15.7% of payroll. The Board was asked to consider including this increase in funding of future retirees medical costs in the proposed rate increase for 2007. Staff noted that an actuarial review is undertaken biennially of the District’s Retirees Health Benefit Program.
Options for increasing rates to offset the Retirees Health Benefit Program’s costs at the low end of 11.5% of payroll, mid-range of 13.5% of payroll, and the high end of 15.7% of payroll, as well as over a one, two or three-year period were evaluated. An increase in the water rates of 11.5% of payroll over a three-year period would require a $0.008 per HCF unit increase or 7.29% increase to the local costs component. An increase of 15.7% of payroll over a three-year period would necessitate a $0.012 per HCF unit increase or a 9% increase in the local cost water rate component. In the event that the rate increases for pre-funding of the Retirees Health Benefit Plan are adopted, the District’s ranking in the Authority’s survey of water rates for similar agencies would change to the 3rd lowest rates (from 2nd) for M&I customers and maintain its position of having the 2nd lowest agricultural rate.
The Board elected a water rate increase of $0.013 per HCF or $5.445 per acre foot (9.24% increase in the local cost), and an increase in the wastewater charge of $0.480/EDU/month for a two-year period for the pre-funding of the District’s Retirees Health Benefit Program to be included in the proposed water and wastewater rate increases for 2007 that will be noticed for the Public Hearing on the proposed rate increases. Said Notice will be presented for the Board’s review at the December 4th regular meeting.
6. Ordinance Setting Forth Directives for Board Actions:
Ordinance No. 2006-12 was presented for adoption which amends Section 30.11 of the District’s Administrative Code to set forth voting procedures for Board action. General Counsel Cowett reported that under the Municipal Water District Law of 1911, the Board can act only by ordinance, resolution or motion. The decision to act by ordinance, resolution or motion is, in some cases, driven by the statutes, and in other cases, driven by District procedures. Actions of the Board that per statute and the Water Code must be taken by ordinance or resolution are set forth in the revised Section 30.11, Voting.
Upon motion by Aleshire, seconded by Haskell and unanimously carried, the following ordinance, entitled:
ORDINANCE NO. 2006-12
ORDINANCE OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
AMENDING THE ADMINISTRATIVE CODE, SECTION 30.11,
VOTING, TO SET FORTH VOTING PROCEDURES FOR
ACTIONS OF THE BOARD OF DIRECTORS
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
GENERAL MANAGER’S AGENDA
7. Status Report on the Municipal Service Review for the Bonsall and Pala Hydrologic Subareas:
General Manager Arant reported that LAFCO has reported that it will not take action on the Municipal Service Review that has been underway for the Bonsall and Pala Hydrologic Subareas until completion of environmental documents by the San Luis Rey M.W.D., which is not expected until September 2007. A meeting of the Ad Hoc Subcommittee members was held in which the District’s policy perspectives on the potential consolidation of lands in and adjacent to the San Luis Rey M.W.D. was reviewed. There was agreement expressed on the core issues such as separate
water rates, but there were differing opinions on the groundwater rights issue. The District’s concept is that the landowners would have rights to the groundwater for agricultural purposes, but would relinquish those rights upon development of the land and the District would then utilize the groundwater for other beneficial uses such as watering for parks, along roadsides and other common areas. The San Luis Rey M.W.D. subcommittee members expressed that it is their opinion that the property owners would retain the groundwater rights and sell it or put it to beneficial use. It was noted that it is anticipated that Metropolitan Water District and the San Diego County Water Authority will stipulate, as a condition of annexation, that the groundwater would continue to be put to beneficial use upon imported water use in the area.
8. Aqueduct Shutdown and Water Use Prohibitions from November 26 to December 7, 2006:
Customers have received notification of the prohibition of outside watering during the aqueduct shutdown starting November 26th through to December 7, 2006 via a mailed package, phone calls, door hangers, automated phone calls, message boards and phone calls to the top water users. Metropolitan Water District’s expansion project at its Lake Skinner Water Treatment Plant has necessitated the shutdown of the treated water aqueducts serving our region. Weather conditions will be monitored by Metropolitan, and, if necessary, the duration of the shutdown could be lessened, but then a subsequent shutdown of the aqueducts would be needed to complete the improvement project at the Skinner Treatment Plant. The expansion project at the Lake Skinner Water Treatment Plant will expand the plant’s capacity by 110 MGD and is expected to be on-line by the summer of 2007.
BOARD OF DIRECTORS’ AGENDA
9. Report on the ACWA Board of Directors’ Meeting:
Director Aleshire reported he had attended the ACWA Board of Directors’ meeting on November 16 and 17 in which a report was given by the ACWA Task Force working on developing a “Real” Water Bond for 2008. Their recommendations included expenditures that were not acceptable, and priorities were then established for inclusion in ACWA’s draft of a 2008 Water Bond. These priorities include funding for: surface storage construction, Delta conveyance construction, groundwater storage construction and water management measures. Glen Peterson, ACWA Vice President, was appointed as Chair of the Task Force to redraft ACWA’s proposed Water Bond. These efforts will parallel the efforts of Senator Cogdill and Assembly Member Villines to draft legislation for water improvement projects. If legislation is not passed, ACWA will be prepared to pursue the initiative process for its Water Bond.
ADJOURNMENT
10. Upon motion by Haskell, seconded by Stone and unanimously carried, the meeting was adjourned at 4:06 p.m.
ATTEST: ATTEST:
______________________________ _______________________________
President Secretary