minutes

Regular Meeting

Governing Board of Sweetwater Authority

June 28, 2006

The Governing Board of Sweetwater Authority held a regular meeting on Wednesday, June 28, 2006, at the Sweetwater Authority Administrative Office, 505 Garrett Avenue, Chula Vista, California. Vice Chair Beauchamp called the meeting to order at 3:31 p.m.

• ROLL CALL

Directors Present: Alkire, Beauchamp, Doud, and Welsh.

Directors Absent: Morrison, Pocklington, and Salas.

Others Present: General Manager/Treasurer Bostad, Operations Manager Rogers, Legal Counsel Cowett, Treasurer Delegatee Farrow, and Board Secretary Schoonderwoerd. Staff members Rick Alexander, Janet Gonzalez, Mark Molsberry, George Silva, Jim Smyth, Don Thomson and Tom Woodrum. Members of the public: Pat Donnelly and Ric Williams, The Pointe and Gosnell Builders; and Randy Hill, CH2M Hill

Vice Chair Beauchamp called for the record to show that Chair Pocklington and Director Morrison were absent due to previous commitments.

• PLEDGE OF ALLEGIANCE TO THE FLAG
Director Beauchamp conducted the pledge of allegiance to the flag.

• OPPORTUNITY FOR PUBLIC COMMENT (Government Code Section (54954.3)
There were no members of the public present for comment.

• CHAIR’S PRESENTATION
There was none.

ACTION CALENDAR ITEMS

1. ITEMS TO BE ADDED, WITHDRAWN, OR REORDERED IN THE AGENDA

There were none.

2. APPROVAL OF MINUTES

Director Welsh made a motion, seconded by Director Doud, that the Governing Board approve the minutes of the June 14, 2006 meeting. The motion carried.

3. APPROVAL OF DEMANDS AND WARRANTS

Director Doud made a motion, seconded by Director Alkire, that the Governing Board approve Warrants 105686 through 105887 including all voided checks. The motion carried.

4. FINANCE AND PERSONNEL COMMITTEE (Meeting of June 21, 2006)

A. CLOSED SESSION
In accordance with Government Code Section 54957.6, the Committee met in closed session to conference with the General Manager regarding labor negotiations. There was no reportable action.

B. Director Alkire made a motion, seconded by Director Welsh, that the Governing Board approve the proposed hourly rate increases for legal services from Best Best & Krieger LLP to become effective July 1, 2006, as follows: $203 for Partner; $182 for Senior Associate; $150 for Junior Associate; and $114 for Paralegal. These rates will be subject to a CPI adjustment each July 1st, based on the All Urban Consumers’ Index. The motion carried.

NOTE: Director Salas entered the meeting at 3:36 p.m.

C. Director Alkire made a motion, seconded by Director Doud, that the Governing Board approve the 2006 membership renewal in the Urban Water Institute and the payment of dues in the amount of $1,500. The motion carried.

D. Continued review of fiscal year 2006-07 budget. The Committee continued its review of the budget and submitted it to the Board Budget Workshop on June 23, 2006 for consideration. This was an information item and no action was required by the Governing Board.

5. OPERATIONS COMMITTEE (Meeting of June 21, 2006)

A. Director of Environmental and Governmental Services Alexander gave a brief presentation on the proposed Memorandum of Agreement (MOA) with The Pointe and Gosnell Builders (The Pointe) relating to its development east of Sweetwater Reservoir. Initial discussions resulted in a conceptual draft MOA that identifies several items of joint interest. The first item is mitigation to wetlands. The Pointe is responsible to mitigate impacts for 4.3 acres for wetlands. Sweetwater Authority may provide acreage for mitigation in turn for compensation that could offset costs to operate and maintain Sweetwater Authority’s share of the Joint Water Agency NCCP. Director Welsh had concerns about partnering with mitigation for a commercial project. Mr. Alexander said the purpose of the discussion is to determine if it serves Sweetwater Authority’s interest to enter into such a partnership and to accept that mitigation. The Pointe is also suggesting that they could underwrite the setup of a mitigation bank on Sweetwater Authority property, which we could then use to take on mitigation for other outside parties.

A second part of the proposed MOA is the purchase of approximately 4.0 acres of Authority land by The Pointe for the Jamacha Boulevard realignment. A third part of the proposal is fire emergency access for emergency responders to Pointe properties through one of the Authority’s gates. Another proposed activity is to obtain and transfer some soils to assist in sand mining pond rehabilitation in the eastern part of the Sweetwater Reservoir property and to facilitate The Pointe’s golf course construction, if additional soil is available. This would come from the reservoir bottom and have the potential benefit of increasing or restoring capacity within the reservoir. General Manager Bostad said that we are looking at the availability of appropriate silt and sand at the east end of the reservoir to place in the sand ponds on our property for revegetation. There are potential benefits to both parties. Mr. Alexander said that another consideration in the MOA is the facilitation and acceleration of the construction of approximately 7,000 feet of boundary fence between The Pointe and Sweetwater property. Other cooperative actions include dealing with erosion entering our property from the Centex Homes development and working with the County on recreational trail planning. Mr. Alexander displayed maps to further illustrate the proposed activities.

Director Doud made a motion, seconded by Director Alkire, that the Governing Board authorize staff to continue negotiations with The Pointe and Gosnell Builders to determine if entering into a Memorandum of Agreement should be proposed at a future date. The motion carried.

B. Director Doud made a motion, seconded by Director Welsh, that the Governing Board award a contract in the amount of $121,000 to Spiess Construction Co., Inc., 1110 E. Clark Avenue, Suite 210, Santa Maria, CA 93457 to complete the Claire Vista “A” Tank Improvements. The motion carried.

C. Director Doud made a motion, seconded by Director Welsh, that the Governing Board approve the request for the remote service at 1124 Elm Avenue, Chula Vista, with the understanding that the owner will be responsible for all fees and deposits. The motion carried.

6. NEW BUSINESS

Legal Counsel Cowett reported that this resolution was brought for adoption because some water agencies in the state were rejecting water capacity to new developments that contained low or moderate income housing some time ago. In an attempt to solve the problem, the legislature adopted SB 1087, which imposed on all agencies the obligation to make it a priority to serve those types of projects. Basically, it is an issue that involves agencies with limited capacity. Director Doud noted that the words “sewer service” should be stricken from Sweetwater Authority’s resolution.

Upon a motion made by Director Doud, seconded by Director Salas, subject to removal of the reference to Sweetwater Authority as a sewer service provider, the following resolution:

RESOLUTION 06-05

RESOLUTION OF THE GOVERNING BOARD OF SWEETWATER AUTHORITY
ADOPTING A SERVICES PRIORITY POLICY FOR LOWER INCOME DEVELOPMENTS
IN ACCORDANCE WITH SB 1087

was passed and adopted by the following vote to wit:

Ayes: Directors Alkire, Beauchamp, Doud, Salas, and Welsh
Noes: None
Absent: Morrison and Pocklington
Abstain: None

7. REPORT OF THE SOUTH BAY IRRIGATION DISTRICT REPRESENTATIVE AND THE CITY OF NATIONAL CITY REPRESENTATIVE TO THE SAN DIEGO COUNTY WATER AUTHORITY

Directors Pocklington and Morrison were not present, and no report was given.

8. APPROVAL OF DIRECTORS’ ATTENDANCE AT MEETINGS AND FUTURE AGENDA ITEMS

A. Sweetwater Authority Leader Tour – Richard A. Reynolds Desalination Facility – Friday, July 14, 2006, 11:30 a.m. to 3:30 p.m. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

B. Water Agencies Association of San Diego County Quarterly Dinner - Program: Jeffrey Kightlinger, General Manager, MWD, “Solutions for Future Water Supply Needs” – Thursday, July 20, 2006, 6:00 p.m. to 9:00 p.m. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

C. Water Education Foundation Water Policy & Law Briefing – Hyatt Regency Orange County, Garden Grove, CA – July 20-21, 2006. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

D. San Diego County Water Authority Legislative Roundtable with Assembly Republican Leader George Plescia – Discussion on water-related issues and legislation affecting the state and the San Diego region – Friday, July 21, 2006, 7:30 a.m. to 9:00 a.m. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

E. ACWA Region 10 meeting - Briefing from ACWA leaders on key issues facing ACWA and discussion on the Caves initiative (Proposition 84). Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

9. REPORTS BY DIRECTORS ON EVENTS ATTENDED

Director Beauchamp reported on his attendance at the Urban Water Institute conference on May 1 through June 2. He was glad he had the chance to sit with Paul Davy from Vallecitos and share common water and biology interests. He also attended the AWWA Annual Conference on June 12-15. He said it was the largest conference he has attended in the three and one-half years he has been on the Board. He was particularly interested in programs on zero liquid discharge, desal, and pharmaceuticals in the water. He said the subject matter was very technical. He also thanked General Manager Bostad for the great presentation at the Council of Water Utilities meeting on June 20th.

Director Welsh reported on attending the Perdue Plant EIR open house on June 20th. She said Rick Alexander and Communications staff did an outstanding job of putting the display up and that the visual proved helpful. Mr. Alexander said that about two dozen people were in attendance. Director Welsh also said that she found the program at the Council of Water Utilities meeting that same day to be very interesting.

Director Doud reported on attending the WESTCAS Annual Conference on June 14-16. He said that elections were held for state directors, and all incumbents were reelected, including Sweetwater’s endorsement, Bob Martin. Opening remarks were given by Lt. Colonel Gregory Thomas, USMC, Facility Maintenance Officer, Camp Pendleton, and his topics were the facility and infrastructure problems he faces at Camp Pendleton. Chris Frahm spoke on how California finances water development. He reported on numerous desal bills awaiting action in Washington, D.C. and gave an overview of the Bureau of Reclamation’s 2007 water recycling, reclamation and reuse programs. He also reported on the June 20th Perdue Plant EIR open house, and said that the use of the scissor jack work stand was an excellent visual demonstration which showed how high the building was going to be.

10. BUDGET REPORT – INTERIM DIRECTOR OF FINANCE FARROW
Report as of May 31, 2006

Interim Finance Director Farrow reported that Water Sales were $872,124 under budget. Other Income is $23,563 under budget. Next year’s budget will reflect the one-time payments received in the Capital budget. Interest Income is $321,451 over budget, and she anticipates that fiscal year 2005-06 will end at $1.5 to $1.6 million. Operating Expenses are over budget by $350,973, partly due to two main leaks in South Chula Vista, paving maintenance, and fuel costs that impact chemical purchases. At the 11th period we are approximately 50 percent spent on Capital Projects and, as discussed in the budget workshop, many of these projects will be carried forward into the next fiscal year.

Director Salas inquired about the Water Sales shortfall and the effect on the proposed rate adjustment recommended in the budget workshop. Ms. Farrow said we would have a better answer after calculating June sales. Director Salas expressed concern about postponing a rate increase to January 2007 as opposed to September 2006. Ms. Farrow said preliminary reports will be brought to the Board before the final budget in August.

11. MANAGEMENT REPORT

A. Report of Operations Manager Rogers: Operations Manager Rogers reported that the current warm weather will make a difference in consumption, and those results will be seen in July and August. He reported that the deep storm drain issue on Main Street is on the City of Chula Vista Council agenda on July 18 with the recommendation to set aside approximately $350,000 to support those mains. He also showed a slide of the Sweetwater River watershed topographic model that will become part of the Chula Vista Nature Interpretive Center exhibit.

B. Report of General Manager Bostad: General Manager Bostad noted that one of the issues to be discussed at the ACWA Region 10 meeting on July 6th is focused on the controversial Caves initiative (Proposition 84), which needs more policy and background provided. CWA will be discussing this at its Board meeting in July also. He noted that Sue Varty from Olivenhain will be providing a presentation to South Bay Irrigation District in July on this initiative. This will be an opportunity to gather information from the various sources so the Board will be able to consider it later in July.

12. DIRECTORS’ COMMENTS

Director Doud commented on the drilling of monitoring wells at 1324 Third Avenue over the past couple of weeks and why it was being done. General Manager Bostad said that generally this is under the control of the Regional Board or the County Department of Environmental Health and is associated generally with a leaking underground storage tank.

Director Beauchamp asked if the Board could adopt a resolution for Andy Horne to thank him and recognize his role as a liaison to the CWA and his understanding of the issues in the Imperial Valley. General Manager Bostad said he would ask staff to prepare something to bring to the Board.

13. CLOSED SESSION

There was no need for one.

14. ADJOURNMENT

With no further business before the Board, Vice Chair Beauchamp adjourned the meeting at 4:47 p.m., to the hour of 6:00 p.m. on July 12, 2006.