VALLEY CENTER MUNICIPAL WATER DISTRICT

VALLEY CENTER MUNICIPAL WATER DISTRICT

Regular Board Meeting

Monday, May 7, 2007

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, Stone and Haskell. Director Aleshire was absent. Staff members present were: General Manager Arant, General Counsel Cowett, Manager of Accounting Pugh, District Engineer Grabbe, Director of Operations Hoyle, Board Secretary Stetson, Project Manager Williams, Accounting Specialist Masley and Administrative Assistant Dersch. Spectators present were: Mr. Dino Urdanivia and Mr. Dave Ross.

CONSENT CALENDAR

1. Upon motion by Stone, seconded by Haskell and unanimously carried, the following consent calendar items were approved:

• Minutes of the Board meeting held April 16, 2007

• Audit demand check numbers 112969 through 113330

• Treasurer’s Report and Financial Statements for the period ended March 31, 2007

ACTION AGENDA

2. Appeal of the Denial of Mr. Urdanivia’s Request for Deferral of Water Availability Charge:

Mr. Dino Herrera Urdanivia applied for a deferral of the District’s water availability charge for his property (APN 189-052-06-00) as per the District’s deferral/exemption policy. Mr. Urdanivia’s deferral request was denied due to the fact that Mr. Urdanivia is not in good financial standing with the District. General Manager Arant explained that Mr. Urdanivia had previously resided at APN 188-290-57, and his unpaid water bill with the District from 2002 amounting to $1,162.95 was discharged by the federal court when he filed for bankruptcy. Mr. Urdanivia requested an appeal of the denial with the Board of Directors.

Mr. Urdanivia of 31515 Valley Center Road addressed the Board stating that he feels the decision by General Manager Arant to deny his request for a waiver of the District’s water availability charge is personal as the denial is based on “not being in good financial standing”. He stated that he does not, at this time, owe any money to the District, and had used his right to file bankruptcy due to financial problems which discharged the former debt. Mr. Urdanivia voiced that his uncollected debt is not related to his request for a waiver of the District’s water availability charge on a different parcel. Mr. Urdanivia stated that his property (APN 189-052-06-00) has water service through a well and, therefore, he is paying for a service he does not receive. Mr. Urdanivia requested that the Board repeal the denial of his request for waiver of the District’s water availability charge on APN 189-052-06-00.

It was pointed that a water line in Valley Center Road traverses across the northern part of Mr. Urdanivia’s property which is a benefit to his property. General Manager Arant explained that the granting of a deferral of the District’s water availability charge is a discretionary action on the part of the District. It was determined from an evaluation of the application for a deferral that it was not prudent to grant Mr. Urdanivia the financial benefits associated with a deferral of the water availability charge as he had not previously met financial obligations to the District.

Director Stone added that the District-wide water availability charge is earmarked for capital improvement projects, which include maintaining and upgrading pipelines to maintain reliable water service, which is of benefit to Mr. Urdanivia.

President Broomell stated that Mr. Urdanivia’s former debt for water service, which is uncollectible due to it being discharged by the bankruptcy court, is then subsidized by the other ratepayers in the District. He stated that he concurs with General Manager Arant’s denial of Mr. Urdanivia’s request for deferral of the District’s water availability charge.

Upon motion by Stone, seconded by Haskell and unanimously carried, the Board affirmed the denial of Mr. Urdanivia’s request for a deferral of the District’s water availability charges for APN 189-052-06-00.

3. Review of Capital Improvement Projects Scheduled for Completion in Fiscal Year 2006-2007:

Project Manager Williams provided an update on capital improvement projects that are projected to be completed in FY 2006-07, which are summarized below:

• Meadows Reservoir #2 – A 2 MG reservoir constructed to augment storage in the western portion of the District. Construction began in January 2005, and was in service in December 2005 with acceptance in August 2006. The project’s total cost was $1,408,242.

• Merry Ferry/East Miller PRV Station Upgrades – Installed 6-inch pressure reducing valves with 2-inch bypass valves and constructed above ground, replacing the below ground facilities. The notice of completion for these projects was filed in April 2007. The total cost of the upgrades was $286,870

• Lake Wohlford/Kumeyaay Way Pipeline Relocation – Pipeline relocated in response to a County of San Diego Storm Drain Improvement project and the line was upsized. The project was completed early in FY 2006-07 at a total cost of $88,151.

• Valley Center Road/Lake Wohlford Road Water Main Relocation – Project consisted of water main relocation, relocation of meters, air vacs and a fire hydrant. Total cost was $141,973.

• Couser Way Pipeline Replacement Project – Project consisted of abandonment of an 8” water main and installation of approximately 450 feet of 8” pipe and 150 feet of above ground pipe in the vicinity of a creek crossing. Currently, the project is 80% complete and expected to be finished by the end of May 2007. Thus far, $135,554 has been spent and there is a remaining balance in the project’s budget of $44,446.

• Couser Pump Station – Horizontal pumps (three 100 HP) were replaced with more efficient vertical turbine pumps (three 125 HP pumps). Minor piping remains to be completed along with above ground site work. The project is expected to be completed in June 2007. To date, $954,562 has been spent with a remaining balance in the project’s budget of $132,438.

• Via Cantamar Pump Station – Installed to improve the pressure for the Via Cantamar Reservoir area as well as to pump water to Country Club Reservoir. Five 10 HP pumps were installed and projected to be completed in May 2007. Funds spent to date are $194,859.

• Valley Center Road Pipeline Replacement Project – Pipeline replacement project extends in Valley Center Road from the intersection with Ridge Ranch Road to the intersection with Cole Grade Road. To date, of the 17,709 linear feet of pipeline to be replaced, 998 linear feet of 8” pipeline and 3,866 linear feet of 12” pipeline have been installed along with 22 meter services. $1,410,783 has been paid to date for this project of the revised contract total of $4,090,574.

3. Board Approval of the Sewer System Management Plan’s Development Plan and Schedule and Goals and Organization:

District Engineer Grabbe explained that the State Water Resources Control Board adopted a General Waste Discharge Requirement (GWDR) for all publicly owned wastewater collection systems in the state with more than one mile of collection main. The GWDR requires affected collection agencies develop a Sewer System

Management Plan (SSMP) and to create and implement a Sanitary Sewer Overflow Prevention Plan and a Sanitary Sewer Overflow Response Plan, as well as spill reporting procedures and on-line reporting of any sanitary sewer overflows starting in January 2007.

The implementation schedule and plan for development of the SSMP were reviewed, as follows:

1. SSMP development plan and schedule – 2/1/08

2. Goals and organization structure – 5/1/08

3. Overflow emergency response program – 11/ 1/09

4. Legal authority – 11/1/09

5. Operation and maintenance program – 11/1/09

6. Grease control program – 11/1/09

7. Design and performance standards – 5/1/10

8. System evaluation and capacity assurance plan – 5/1/10

9. Final SSMP, incorporating all SSMP elements – 5/1/10

The goal is to complete the development plan for the SSMP by December 2007. Upon approval of the Plan, schedule, goals and organization structure, staff will develop an SSMP web page that can be viewed on the District’s website.

Goals of the SSMP will be developed to manage, operate and maintain all parts of the District’s wastewater collection system. The SSMP will outline, describe and provide methods and policies to:

• Properly manage, operate and maintain all portions of the agency’s wastewater collection system,

• Provide adequate capacity to convey peak wastewater flows,

• Minimize the frequency of Sanitary Sewer Overflows

• Mitigate the impacts that are associated with any Sanitary Sewer Overflow that may occur, and

• Meet all applicable regulatory notification and reporting requirements.

The SSMP Organization Structure as proposed is as shown on the attached Exhibit “A”.

Upon motion by Polito, seconded by Haskell and unanimously carried, the Board approved the Sewer System Management Plan’s (SSMP) Development Plan and Schedule and the Goals and Organization Structure as presented.

4. Water Supply Update and Approval of Agricultural Water Supply Advisory:

The Metropolitan Water District’s Water Surplus and Drought Management Plan report as of April 15^th was reviewed. The report reflects the dry conditions of the watersheds of the Colorado River and the State Water Project. Metropolitan entered 2007 with approximately 2.5 MAF of supplies. These supplies include surface storage, groundwater storage and water transfer agreements that will be utilized to meet deficits in supply and demand under an extremely dry scenario. Should the dry conditions continue into the winter of 2007-08, it is anticipated that a mandatory supply reduction will be implemented for customers participating in Metropolitan’s Interim Agricultural Water Program (IAWP). Also, due to the court order pertaining to the Department of Water Resources obtaining a permit to operate the pumps on the State Water Project, more restrictions for importing water out of the Delta are expected.

The letter advising the District’s agricultural customers (participants in the IAWP) of the potential of a supply cutback and a review of the IAWP and its interruptible status, including the parameters to withdraw from the Program, was approved, which is attached hereto as Exhibit “B”.

GENERAL MANAGER’S AGENDA

5. Review of Miscellaneous Informational Items:

General Manager Arant reported that the San Diego County Water Authority updated its 2005 Urban Water Management Plan to reflect that the desalination program is a local program. Language was included that the Authority would support the Carlsbad-Poseidon desal. project rather than stating a general support of desalination. A resolution and letter of support of the Carlsbad desal. program approved by the Authority’s Board will be pursued to be forwarded to the California Coastal Commission. The updated Plan includes supporting funding for facilities needed by member agencies to accept and distribute desalted seawater. A group at the Authority is working toward changing policy to allow for wheeling or transfer of desalted water.

There is new activity regarding the proposed solar energy project at the District’s Lake Turner and Betsworth Pumping Station. A new investor with WorldWater & Power is pursuing completion of the solar power purchase program with the District at the 8.5¢ per Kwh price. The District’s position is to receive 100% of the renewable energy credits from this solar project.

ADJOURNMENT

6. Upon motion by Polito, seconded by Stone and unanimously carried, the meeting was adjourned at 3:50 p.m.

ATTEST: ATTEST:

______________________________ _______________________________

President Secretary