January 20, 2009
VALLEY CENTER WATER DISTRICT
Regular Board Meeting
Monday, January 20, 2009
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, District Engineer Grabbe, Director of Operations Hoyle, Director of Finance Jeffrey, Board Secretary Stetson, Project Managers Kilwein and Carrillo, and Manager of IT Pilve. Spectators present were: Mr. and Mrs. Olson, Ms. O’Rourke, Susan and Wayne Hilbig, Mr. S. Bernsen, Mr. I. Bernsen, Mr. and Mrs. Ohlson, Mr. and Mrs. Flynn, Mr. and Mrs. Stephens, Messrs. Walker, Makey, Saalberg, Wynn, Ramirez, Suarez, McCarley, Johnson, Coseo, Buerfeind, Battray, Farmer, Beatty and Mses. Bozulich and Odland.
ELECTION OF OFFICERS
1. Upon motion by Aleshire, seconded by Stone and unanimously carried, Gary A. Broomell was reelected President of the Board of Directors.
Upon motion by Stone, seconded by Aleshire and unanimously carried, Robert A. Polito was reelected Vice President of the Board of Directors.
CONSENT CALENDAR
2. Upon motion by Stone, seconded by Polito and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held December 15, 2008
• Audit demand check numbers 120888 through 121220 and wire disbursements 08-095 through 08-137
• Treasurer’s Report and Financial Statements for the period ended November 30, 2008
• Board of Directors’ request for reimbursement of expenses and report of expenses
• Quarterly report of employees’ expense reimbursements for the quarter ended December 31, 2008
• District’s population as of January 1, 2009
ACTION AGENDA
3. South Village Wastewater Expansion Project:
District Engineer Grabbe reported that Wastewater Service Agreements were executed with property owners for a commitment of participation in the South Village Wastewater Expansion project for 83 EDUs of capacity. The Bell/Alti developments will require wastewater capacity of 147 EDUs. The expansion project was being pursued (Phase 2) in which Bell/Alti would privately finance their share and an assessment district would finance the other participating property owners’ project costs. However, due to the low level of participation by property owners, the formation of an assessment district and the sale of bonds were not recommended at this time.
A design concept for an expansion of the Woods Valley Ranch Water Reclamation Facility (WVRWRF) for wastewater service to Bell/Alti and other interested property owners to be completed as a private expansion project was reviewed. An AeroMod treatment system was selected for its low maintenance requirements, operational flexibility and expandability. The AeroMod design consists of common wall treatment modules that can be added in incremental components with each module having two treatment trains. The master plan for the expansion of the WVRWRF recommended a two module design to maximize the overall site capacity at 1,600 EDUs plus the original 300 EDUs in the existing Membrane Bioreactor (MBR) facility.
Due to the relatively low participant level in the proposed wastewater expansion project, a small module was considered; however, its size should maximize the overall site capacity for the number of modules to ultimately be constructed. A minimum module design capacity of 60,000 gpd (2 trains at 30,000 gpd each) would be required. Staff recommended that the design of one 125,000 gpd module be pursued by Bell/Alti and increased property owner participation in the South Village wastewater service area will continue to be solicited during the design phase. At the time of construction, if there are not sufficient participants to fund the full module, Bell/Alti could construct one train (one half of the module).
A capacity pool would be maintained to market excess, unassigned capacity to property owners within the South Village service area. The capacity pool would be managed by the District and capacity sold on a first in/first out basis. Upon completion of the Phase 2 improvements, 20 additional EDUs will be generated from the Phase 1 MBR facility and 33 EDUs in the proposed Phase 2 facility.
Standby charges, which fund the maintenance and replacement of facilities required to provide wastewater service, were proposed to be assessed during the construction phase for those EDUs assigned to a specific property. The standby charge would be 50% of the monthly service charge during construction and 100% after final acceptance of the facilities. The charge would be based on the monthly service charge established for the Woods Valley Ranch Water Reclamation Facility.
There will be a reimbursement agreement with Newland Communities to establish reimbursement for the excess capacity they funded with the construction of the Phase 1 improvements. These Phase 1 improvements were sized to benefit future phases. Staff proposed that associated reimbursements to Newland Communities shall be paid prior to issuance of an agency clearance letter and prior to the District’s acceptance of the Phase 2 expansion improvements.
District Engineer Grabbe reviewed that for the proposed Phase 2 wastewater expansion project, a Water Reclamation Facilities Agreement and Recycled Water Use Agreement will be executed. The agreements will outline the terms and conditions for the design, construction and acceptance of the Phase 2 expansion improvements to the Woods Valley Ranch Water Reclamation Facility, for the recycled water and the reimbursement of excess capacity that the expansion project will generate.
Mr. Wayne Hilbig of Butterfield Trails and Alti Corporation addressed the Board and presented an alternative proposal for the Phase 2 WVRWRF Expansion Project. Mr. Hilbig proposed construction of wastewater improvements of 240 EDU capacity which will provide for the community’s development plans and, with a reduced price, allow for more interested property owners to participate with the formation of an assessment district. Mr. Don Bunts, engineering consultant, explained that the existing MBR plant has redundancy built into its design and within the trains of the proposed modules. Additional flow capacity may be realized, as currently the design is based on 250 gallons per EDU and current flows at Woods Valley are approximately 180 gallons/EDU. Seasonal storage for the project has been proposed to be located on property off Charlan Road. Cost estimates for the alternative 240 EDU expansion project were projected at $37,900/EDU by the proponents, Bell/Alti, which does not include assessment district costs.
Staff noted that the proposal presented by Bell/Alti to proceed with the formation of an assessment district that will provide the financing for the 83 EDU capacity for interested property owners could be an expensive endeavor. The possibility of including the Bell/Alti properties’ (147 EDUs) wastewater improvements in the assessment district was discussed. The District is limited in its expenditures as it must abide by its spending limitation ordinance.
Mr. Steve Flynn recognized the value of maximizing the potential use of the wastewater treatment site in designing the wastewater expansion project, but stated that the ultimate build-out of the southern node’s service area will not be as projected with the proposed GP 2020. He stated that the Phase 2 improvements as proposed at 240 EDUs and future expansions will meet the demands as permitted by the County.
Audience members expressed their support of the wastewater expansion project, as summarized below:
• Mike McCarley – Maintains and installs septic tank systems which he noted are temporary solutions and over time can have a frequent rate of failure. A permanent solution is connection to a wastewater facility or the property owners may be required to install a mound system or an advanced treatment system for their property in the future.
• Irv Bernsen – A wastewater system would contribute toward mitigating the use of imported water with its recycled system and development would benefit the community with more jobs.
• Luna Odland – Proceed with the expansion of the wastewater plant to allow property owners to utilize their properties.
• Barbara Olson - The environment for selling of bonds (assessment district) will be improving and noted that recently the City of San Diego had a successful bond sale. Also, due to the state’s water supply conditions, a reduction in water supplies to our region may be eminent and permits for water service could get more challenging. She encouraged evaluation of the proposal to pursue an assessment district for property owners’ participation in the wastewater expansion project.
• Approximately 40 audience members rose to indicate support of the wastewater expansion project and the pursuit of assessment district financing in response to Mrs. Olson’s request for an indication of support from those present.
• Frank Mackey – He’d like to see the expansion project move forward and is committed to participation with a total of 33 EDUs.
Staff was directed to evaluate the Bell/Alti proposal presented for a Phase 2 wastewater expansion project at the Woods Valley Ranch Water Reclamation Facility and consider its impact upon the potential capacity yield of the treatment site.
4. Review of Interim Agricultural Water Program and Special Agricultural Water Rate Reduction Implementation Plans:
General Manager Arant reported that the District’s participants in the Interim Agricultural Water Program (IAWP) for 2008 collectively met their required 30% water use reduction levels based on their 2006-07 usage.
With an effective date of January 1, 2009, IAWP participants were given the opportunity to: 1) continue as a participant in the IAWP which also includes participation in the San Diego County Water Authority’s Special Agricultural Water Rate (SAWR) program, 2) opt-out of the IAWP, but stay in the SAWR, or 3) opt-out of both the IAWP and SAWR and become a full-price customer. As of January 1, 2009, 1,058 accounts elected to remain in the IAWP/SAWR program with 468 accounts electing the SAWR only option, and 209 accounts opting out of the IAWP to become full-price customers.
Accounts that elected to remain in the IAWP for 2009 have been provided their monthly allocations that are the same as in 2008 requiring a 30% reduction from usage in the base year of 2006-07. Any adjustments to a monthly allocation to another month have been retained for the account unless requested otherwise.
A document titled “IAWP & SAWR Reduction Implementation Plans” was prepared in compliance with Metropolitan Water District’s and the San Diego County Water Authority’s requirement. The implementation plan for the IAWP customers is similar to that adopted by the Board for 2008 with the reduction plans and overuse penalties set forth for the IAWP/SAWR and the SAWR only customers. SAWR customers will be subject to the full reduction in water usage as may be called for by Metropolitan Water District based on 2006-07 usage. Water use reductions for full-price customers will be mitigated by local supplies, the all American canal lining project, IID transfer, and storage projects with the reduction based on a 3-year rolling average of Fiscal Years 2004-05, 2005-06 and 2006-07. A mandatory reduction is expected to be called for in April by Metropolitan Water District with its implementation to be July 2009.
5. Resolutions to Maintain Tax Deferrals for Employee Contributions to Cal-PERS:
In order to maintain the tax deferrals for employee contributions to Cal-PERS, resolutions to confirm that the employee payroll deductions are treated as “picked-up” by the District are required. The resolutions document for tax purposes what is in place and maintain the tax deferrals for employee contributions. No cost is incurred by the District to implement the provisions of the resolutions.
Resolution No. 2009-02 documents that the District pays all costs for the Cal-PERS retirement plan except the 6.487% of payroll approved by the employees. Resolution No. 2009-03 contains the legal language necessary to retain the employees’ payroll deduction as tax deferred. Resolution No. 2009-04 confirms that employees’ contributions by payroll deductions for additional service credits are tax deferred.
Upon motion by Polito, seconded by Stone and unanimously carried, the following resolutions, entitled:
RESOLUTION NO. 2009-02
RESOLUTION FOR EMPLOYER PAID MEMBER
CONTRIBUTIONS FOR CALPERS
RESOLUTION NO. 2009-03
EMPLOYER PICKUP RESOLUTION FOR CALPERS
RESOLUTION NO. 2009-04
EMPLOYER PICKUP RESOLUTION PRE-TAX
PAYROLL DEDUCTION PLAN FOR SERVICE
CREDIT PURCHASES (CONTRIBUTION CODE 14)
were adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
GENERAL MANAGER’S AGENDA
6. Review of Miscellaneous Informational Items:
• At the December 18th San Diego County Water Authority Board meeting, participation in the Metropolitan Water District’s Southern California’s 2009 Drought Bank Pilot Program was authorized for up to 5,000 acre feet of dry-year transfer supplies. The District’s proposed project, the Welk Skimming Plant, was approved for a $125,000 grant under the Authority’s Local Investigations and Studies Assistance Program. The transitional Special Agricultural Water Rate (SAWR) for calendar year 2009 was adopted and procedures adopted for administration of the SAWR program.
• A notification of the potential for mandatory water cutbacks in 2009 will be sent to residential and commercial customers in their February 2009 bills. The insert summarizes the current water conditions and that restrictions on water deliveries are likely in our region. Practical water conservation measures are provided as well as resources for data on incentive programs, and low-water use plants.
• The Lake Turner Solar System is on-line providing solar power for the District’s Betsworth Pump Station. The solar carport for solar energy at the District’s corporate facility is expected to be constructed in April-May 2009.
• SDG&E has submitted an application to the PUC to allow for assessment of a tariff for portable generation relating to its proposal to shut off electrical power during extreme weather conditions. A letter of comment to the PUC in opposition to this proposed assessment and the proposed program to turn off electricity during hazardous fire conditions will be forwarded by the District. Litigation against this program will be pursued, if necessary.
• The District will be working with the Valley Center Fire Protection District to test and perform maintenance on fire hydrants throughout the District’s service area at a fee of $25-$30 per hydrant. The hydrants will be serviced on a 3 or 4 year cycle and, with an ISO rating process underway, the maintenance program is expected to reduce homeowners’ insurance costs.
BOARD OF DIRECTORS’ AGENDA
7. ACWA-JPIA Low Loss Ratio Awards:
Director Aleshire reported that the District has received the ACWA-JPIA Special Recognition Awards for achieving a low ratio of paid claims and case reserves to deposit premiums for its Liability, Property and Workers’ Compensation Insurance Programs. This recognition is for the period April 2004 through March 2007. Staff was commended for its educational classes that have contributed toward a safe working environment.
CLOSED SESSION
8. A Closed Session was called by President Broomell at 4:20 p.m. pursuant to:
• Government Code §54956.9(c) – Conference with Legal Counsel,
Anticipated Litigation
Number of potential cases: 1
RECONVENE
9. The Regular Board meeting was reconvened at 4:40 p.m. No action was reported.
ADJOURNMENT
10. Upon motion by Aleshire, seconded by Polito and unanimously carried, the meeting was adjourned at 4:41 p.m.
ATTEST: ATTEST:
____________________________ _______________________________
President Secretary