CALL TO ORDER: The Board of Directors’ meeting of the Mid-Peninsula Water District was called to order by President Zucca at 6:30 p.m.
A. ROLL CALL:
PRESENT: Directors Altscher, Feldman, Linvill, Vella and Zucca
ALSO PRESENT: General Manager Regan, General Counsel Cassman, Secretary Remeleh, Engineer Boscacci and District Treasurer Jeff Ira
STAFF PRESENT: Superintendent Michael Anderson, Rick Bisio, Brent Chester and Jon Tscharner
MEMBERS OF PUBLIC: Joubin Pakpour and Noella Markovich
PRESIDENT: President Zucca presiding.
Whereupon the following proceedings were duly had:
B. PLEDGE OF ALLEGIANCE:
General Counsel Cassman led in the Pledge of Allegiance
C. APPROVAL OF MINUTES:
The minutes of the Regular Board meeting of January 24, 2008 were approved as corrected on a motion by Vice President Feldman and seconded by Director Altscher; Director Vella abstained from the vote due to his absence. The minutes for the Special meeting on January 9, 2008, were unanimously approved on a motion by Director Vella and seconded by Vice President Feldman.
D. PUBLIC COMMENTS:
See Item E
E. PUBLIC HEARING:
President Zucca opened the Public Hearing on the proposed change in water unit rates. He requested a summary from staff. General Manager Regan stated that in July of 2007 the San Francisco Public Utilities Commission (SFPUC) increased rates to its wholesale customers, including the District, by 6.7% to cover its 4.5 billion dollars CIP Project. He stated that wholesale rate increases by the SFPUC are projected to continue for the next 8 to 10 years. He stated that in July the Board decided to defer any increase in District rates and revisit the issue in December. Manager Regan stated during the December meeting the Board, the District Treasurer and Staff offered an overall view of the District’s financial needs, including operations and the Capital Improvement Projects. At that time it was determined that an overall revenue increase of 5.9% would be needed to keep the District financially on track for this fiscal year. Noella Markovich from Holly Road addressed the Board on the proposed rate increase. She asked when was the last rate increase, what was the percentage of increase and the relationship between the District and the other 20 agencies in San Mateo County. She also requested information on how to receive a print out of this information. Attorney Cassman asked if there was any other testimony for the proposed rate increase. There was none. On motion by Director Vella and second by Director Altscher, the public hearing was closed. Manager Regan stated that the last rate increase by the District was July of 2006. It was explained that the last increase was in conjunction with an over all restructure of the tiered rates of the District. President Zucca explained that in July of 2006 the SFPUC raised rates to its wholesale customer by approximately 20%. The District in turn adjusted its rates accordingly. President Zucca explained the District receives all its water from the SFPUC and that the overall cost to the District for water purchased is approximately 50% of the budget. He reiterated the SFPUC has a 4.5 billion dollar Capital Improvement Program it is implementing over the next 10 years to improve the reliability of the system. This cost will be shared by the 28 agencies SFPUC serves. He stated that the SFPUC will continue to increase water rates to these agencies to pay for the cost of the repairs to its system. Vice President Feldman stated the District over the years has run on a very conservative basis. He stated we are one of the very few Districts that run on a pay as you go basis. He stated that other than the mortgage on the Dairy Lane facility, the District has no debt and all improvements are funded on a current basis. It was brought up that part of the increase in the past was for a new water tank. Manager Regan stated this was true and that tank is complete. He also explained that the District is currently building another tank at its Exbourne site and the plans are to build a sister tank along with a pump station and a transmission main to serve that site. President Zucca also explained the District has conservation incentive pricing. This means that the average user uses 15 units of water. The District is proposing to only increase the rate by one cent per unit for the average users. He also explained that the bulk of the rate increase is for consumption for above average usage and the rational behind that is that we live in a water scarce state and this approach creates a financial incentive to conserve water. President Zucca also said the purpose of the 2006 rate increase was to build funds in the District’s reserve account in the event of an outage due to a natural disaster that would leave the District without water revenue for up to 90 days or in the case of major damage to our infrastructure the District would have emergency funds for repairs. President Zucca pointed out that the District has absorbed the cost of the July 2007 wholesale rate increase for over 6 months. President Zucca also explained that with the completion of the Exbourne project over the next few years the large capital improvement projects will be done. At that point, the District’s rates will reflect the fact that the major projects will be completed. He explained that the SFPUC will be continuing to raise rates to its wholesale customers to cover its system repairs and the District will revisit this every year keeping in mind that we are a pay as you go District that requires revenues in reserves in case of emergencies and the District can then adjust rates accordingly. Director Vella stated that part of the question was how the District compared to other water agencies in San Mateo. He explained this information would be available through the internet or staff could provide this it. He also explained that all water agencies have an allocation of water from the SFPUC and MWPD has never exceeded this allocation with the cooperation we have between the District and our customers and a very aggressive conservation outreach. Director Altscher explained that 50% of the District costs is the purchase of water from the SFPUC, which is something that is out of the control of the District, but what the District can control is the other 50%. He explained that the General Manager runs a very tight ship and jobs are done in house by our talented hard working employees to save costs and the District strives to work safely and efficiently to keep insurance costs down. Director Linvill wanted to reassure the public this was not an easy decision and there was a lot of discussion over it. The Board does not take this lightly and it was a considered and thoughtful decision. The Board thanked the public for attending. It was read into record that 16 letters of opposition to the rate increase were received and the Board has reviewed them. On motion by Director Vella and seconded by Director Altscher, Ordinance No 105 was unanimously approved by a roll call vote.
F. WATER CONSERVATION:
Secretary Remeleh is still waiting to hear back from WaterWise regarding the conservation kits for schools. She also reported spring billing stuffers will be going out to remind customers to continue to conserve. The stuffers let customers of the District know we are offering a CD which includes examples of drought resistant plants and landscaping. President Zucca stated that the conservation kits were a success in his daughter’s class and several students are doing science fair projects on water related topics. Secretary Remeleh mentioned that the Belmont Parks and Recreation Department is planning a “Gardening Fair” and she will provide more information as it becomes available.
G. AUDITORS REPORT ON FINANCIAL STATEMENT FOR FISCAL YEAR 2006-2007:
Director Linvill stated that the report was very thorough and easy to read. She also shared a financial spreadsheet analysis of the assets and liabilities of the District she had prepared.
The Financial statement for Fiscal year 2006-2007 was unanimously approved on a motion by Director Altscher and seconded by Vice President Feldman.
N. FINANCIAL REPORT:
This item was moved up on the agenda to follow Item “G”. The Directors discussed possibly comparing a few of the key financials with other Districts to see how we compare to other water agencies. Treasurer Ira will work on the re-formatting of the current Financial Report. The Financial Report was unanimously approved on a motion by Director Vella and seconded by Director Linvill.
H. HUMAN RESOURCE CONSULTANT:
Due to time restraints the HR Consultant was unable to appear before the Board. General Manager Regan stated they will be attending the next Board meeting to make a presentation and answer any questions. General Manager Regan stated he has had several meetings with this group and feels confident they will be able to provide the personnel expertise and support that the District and employees need for the long term. This item will be continued to the next regular meeting.
I. DISTRICT’S INSURANCE POLICY:
The subcommittee of Vice President Feldman and Director Linvill gave an update on the status of the District Liability Insurance Policy. Director Linvill spoke with an insurance group she knew of regarding the District’s current policy and they found our coverage to be overall in good shape. Director Linvill also stated she would be contacting the District’s insurance broker to get more information. This item will be continued to the next regular Board meeting.
J. 2008 DISTRICT GOALS:
This item was moved to follow Item “P” on the agenda.
K. BAWSCA REPORT:
Director Vella was unable to attend the meeting but stated that Rosalie O’Mahony was elected Chair again and Patrick Kolstad was elected as Vice Chair. According to the General Manager of BAWSCA, there will not be a mid year adjustment to the budget. Director Altscher expressed his concerns with the appointment of the new SFPUC General Manager. He hopes that it will not affect the progress of San Francisco’s CIP Projects.
L. DIRECTORS’ REPORTS:
Director Altscher shared his thoughts and comments about the forum that was held on February 1, 2008 in which President Zucca and all MPWD employees attended. Director Altscher received positive feedback from the employees and hopes that it will be a continuous effort. President Zucca was also pleased to have the opportunity to speak with all the employees. He thought it was a very productive and informative meeting.
M. MANAGER’S REPORT:
Manager Regan reported the mainline on Plateau Drive has been completed. The tie in on Notre Dame will commence next month. He reported we have received the Hannibal control valves and hopefully the project will be completed soon. The F Street project has also been completed. Secretary Remeleh reported on the HIA meeting she attended with Superintendent Anderson in the absence of President Zucca and Manager Regan. An overview of the District projects, conservation and school programs were given to the attendees. On a motion by Director Vella and seconded by Director Altscher, the Manager’s Report was unanimously approved.
N. FINANCIAL REPORT:
This item was move to follow Item G. on the agenda.
O. FUTURE NEW BUSINESS ITEMS-SUGGESTIONS BY BOARD:
General Counsel will report back on incidental repairs caused by main breaks.
P. COMMUNICATIONS:
None.
The Board Recessed at 7:55 p.m. and reconvened at 8:12 p.m.
J. 2008 DISTRICT GOALS:
General Manager Regan gave an overview of the District’s 2008 Goals. The goals consist of the following: Grants, Succession Plan, Recruitment Plan, Employee Development Plan, Emergency Plan and the Capital Improvement Program. Manager Regan stated that staff has attended a grant workshop and it was found, as we have also learned in the past, that the grants available to a District like ours are hard to come by. MPWD is in good financial shape, our infrastructure is well maintained and tanks and pump stations have been built or are already planned to be built. Manager Regan also stated he felt that an outside grant writer may be a direction the Board might consider. The Directors stated that staff should continue to look for opportunities and when attending grant meetings or conferences which include people talking about grants, staff should present the problems we face in obtaining grants and find out what we can do to obtain grants from the experts offering them. It was also suggested staff contact other agencies and find out how they deal with grants. Manager Regan asked for comments on the Succession Plan. The Directors stated there should be a procedure for establishing a pool of potential candidates. It was suggested by the Board the Succession Plan should assist anyone who looks to apply for the General Manager position when he decides to retire. The plan should not only look to groom the employees of the District but to make it very transparent to anyone in the District or the public at large what is required to be the General Manager of MPWD. This plan should be a tool that anyone can pick up at any time and see what the requirements are to run the water district in the position of the General Manager. It will be helpful for employees, future Board members and the public to have a plan in place that lays out the steps, requirements, training, education and responsibilities of this position. Staff will continue to make changes to this plan and present it to the Board at a future meeting. Manager Regan gave an overview of the Recruitment plan and stated that staff has been implementing this plan with the vacant office position. The Board is highly anticipating the outcome of the process. This plan will be reviewed on a quarterly basis. Manager Regan gave an overview of the cross training and the timeline of the Employee Development Plan. President Zucca stated the General Manager has showed him the matrix on the cross training of the employees that clearly shows what employees have been trained in and what they still need to be trained to do. It includes education, hands on training and outside training. The Board felt it would be a good idea to do this for all positions within the District so employees could have a clear career path. Staff will make updates to this plan and present it to the Board at a future meeting. This item will also be presented to the Board on a quarterly basis. Manager Regan gave an overview on the Capital Improvement Project Plan. He explained as stated in the tactical plan this item is driven by the master plan and will be updated on a quarterly basis. The General Manager gave an overview of the Emergency Response Preparedness Drill Plan. Several questions were asked by the Directors on the development, process and implementation of this plan which were answered by the General Manager and Staff. This item will be reported on to the Board on a quarterly basis. The MPWD 2008 District Goals will be placed on the agenda for an update at the next regular Board meeting.
Q. CLOSED SESSION:
At the direction of President Zucca, the Board recessed at 9:05 p.m. and convened to closed session with respect to the following specified items on the agenda:
1. CONFERENCE WITH DISTRICT LABOR NEGOTIATORS
Closed session pursuant to Government Code 54957.6
District Negotiator: Board President
Unrepresented Employee: Belmont County Water District Employee Association
2. PUBLIC EMPLOYEE PERFORMANCE EVALUATION
Closed session pursuant to Government Code 54957
Title: General Manager
3. CONFERENCE WITH DISTRICT LABOR NEGOTIATORS
Closed session pursuant to Government Code 54957.6
District Negotiator: Board President
Unrepresented Employee: General Manager
The Board came out of closed session at 10:44 p.m. and the General Counsel reported that no action had been taken.
R. ADJOURNMENT:
President Zucca adjourned the meeting at 10:45 p.m. The next regular meeting of the MPWDBoard is scheduled for Thursday, March 27, 2008 at 6:30 p.m. in the District’s administrative offices at 3 Dairy Lane, Belmont CA 94002.
