minutes

Regular Meeting

Governing Board of Sweetwater Authority

August 9, 2006

The Governing Board of Sweetwater Authority held a regular meeting on Wednesday, August 9, 2006, at the Sweetwater Authority Administrative Office, 505 Garrett Avenue, Chula Vista, California. Chair Pocklington called the meeting to order at 6:01 p.m.

• ROLL CALL

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

Directors Absent: Morrison and Salas.

Others Present: General Manager/Treasurer Bostad, Operations Manager Rogers, Legal Counsel Cowett, Treasurer Delegatee Farrow, and Board Secretary Schoonderwoerd. Staff members: Jim Smyth, Don Thomson, Bill Olson, Rick Alexander, Tom Woodrum, George Silva, and Troy Murphree.

• 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
Chair Pocklington asked for volunteers from the Board to move their staffing time slots for the Lemon Festival in order to have more evenly spread participation.

ACTION CALENDAR ITEMS

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 ITEMS TO BE ADDED, WITHDRAWN, OR REORDERED IN THE AGENDA

The agenda was reordered to accommodate the Public Hearing at the time certain hour of 6:30 p.m.

2. APPROVAL OF MINUTES

Director Beauchamp made a motion, seconded by Director Doud, that the Governing Board approve the minutes of the July 26, 2006 meeting. The motion carried with Director Welsh abstaining due to her absence from that meeting.

3. APPROVAL OF DEMANDS AND WARRANTS

Director Doud made a motion, seconded by Director Alkire, that the Governing Board approve Warrants 106252 through 106458 including all voided checks. The motion carried.

NOTE: Director Morrison entered the meeting at 6:04 p.m.

4. OPERATIONS COMMITTEE (Meeting of August 2, 2006)

A. Environmental Coordinator Murphree gave a short background on the requirements necessary to comply with the California Environmental Quality Act (CEQA) for adopting, approving and reviewing all projects. Best Best and Krieger prepares the Authority’s annual local guideline update pursuant to changes in legislation and litigation throughout the year. The 2006 local guidelines were submitted for the Board’s consideration for adoption.

Upon a motion made by Director Doud, seconded by Director Alkire, the following resolution:

RESOLUTION 06-11

RESOLUTION OF THE GOVERNING BOARD OF SWEETWATER AUTHORITY
AMENDING AND ADOPTING LOCAL GUIDELINES FOR IMPLEMENTING THE CALIFORNIA ENVIRONMENTAL QUALITY ACT
(PUB. RESOURCES CODE §§ 21000 ET SEQ.)

was passed and adopted by the following vote to wit:

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

B. Director Doud made a motion, seconded by Director Welsh, that the Governing Board approve National City School District’s request to extend its agreement through December 31, 2010, and to increase the monthly rent payment to $400. The motion carried.

C. Solar power pilot program. General Manager Bostad said that the Committee’s dialogue was very valuable in bringing out new ideas to look for potential funding and to possibly incorporate in future projects. Staff will continue to look at other options for green types of projects and programs including solar. This was an information item and no action was required by the Governing Board.

D. Director Doud made a motion, seconded by Director Welsh, that the Governing Board approve the County of San Diego’s request to quitclaim the parcel containing the overflow pond, with the understanding that the County will be responsible for the appropriate documentation processing, and that the quitclaim deed will include a condition to revert the property back to the Authority, at no cost, should the County abandon this facility. The motion carried.

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

A. Water Education Foundation 2006 Northern California Tour – September 13-15, 2006, Sacramento, CA. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

B. California Special Districts Association 2006 Annual Conference – September 25-28, 2006, Resort at Squaw Creek, North Lake Tahoe, CA. Directors wishing to attend this pre-approved event will contact the Secretary. No action was required by the Governing Board.

6. REPORTS BY DIRECTORS ON EVENTS ATTENDED

Director Welsh reported on her attendance at the NWRA Western Water Seminar on July 26-28th. She met a woman who has been hired to make the Bureau of Reclamation more responsive to the public. There was a good deal of discussion on the Bureau and congressional issues and laws related to water quality and the way water is distributed. Director Welsh said the hope was expressed at the conference that Robert Johnson would get the appointment as the new Commissioner. The use of recycling in the agricultural community; problems in exporting fruit to Japan grown with recycled water; and water rights related to recycled water in Texas compared to California’s water rights were among the points of discussion.

At the time certain hour of 6:30, the Public Hearing to consider an increase in the Authority’s Capacity Fee was opened by Chair Pocklington. This item will be reported as Item 7 in the minutes.

Directors Doud and Pocklington reported on the Chula Vista Interagency Water Task Force meeting on July 31st. Sweetwater Authority’s presentation provided background on its Proposition 50 programs; interest was expressed regarding development of a brine line and a feasibility analysis for a brackish groundwater plant on the Otay River; additional funding was received to move forward on expansion on the Reynolds Plant on the Sweetwater River; and membrane bioreactors were discussed. Director Doud reported that changes to the Cooperative Agreement included the addition of a Vice Chair position, the addition of drought management to program functions and duties, and changes to the meeting dates.

Directors Welsh and Alkire reported on attending the Water Education Foundation Sierra Watershed Tour on August 3-4. Interesting discussions were held on pollution and contamination dating back to the Gold Rush era, the Bay Delta Accord, and the development activities in Lake Tahoe. Director Welsh met a tour participant from Kyoto, Japan who traveled to the U.S. solely for this tour, and she encouraged him to take the Southern California tour. Director Alkire said this tour was another outstanding Water Education Foundation tour, and he estimated that there were about 50 tour participants. Of particular interest was the raising of Folsom Dam, the financial issues involving high bids, working underwater, and challenges with various options for releasing water from the dam. He added that to build in Lake Tahoe, water rights must be bought from the owner and transferred to the water authority for hook-in.

Director Doud reported on attending the First Friday Breakfast on August 4th. The program by Allen Huffman, “Beyond Traffic – a New Transportation Vision for San Diego Region – Move San Diego’s Fast Plan,” was controversial. His presentation about tunnel transportation in Brazil was interesting. He sat next to the Planning Director for MWD who said these programs are already being researched.

Chair Pocklington reported that many of the directors attended the National City Automobile Heritage Day on August 6th. The customers that visited the booth were thankful for Sweetwater’s participation, as well as some City of San Diego customers. Director Welsh agreed and said the water buffalo was appreciated, as well as being able to use the Authority’s map on water sources. They received many questions about the safety of the drinking water due to the recent boil water order for the City of San Diego main break. She added that people were asking how Sweetwater Authority protects its water, and that a short flyer relating to that would be helpful for future events. Director Alkire said he received questions about the fishing program at Sweetwater Reservoir. Handouts were available for Loveland’s program, but nothing for Sweetwater. He suggested that a handout about Sweetwater Reservoir’s program would be helpful in the future.

7. PUBLIC HEARING (Government Code Section 54954.3)

At 6:30 p.m. Chair Pocklington opened the Public Hearing to give the opportunity for members of the public to address the Board regarding the adoption of an increase in the Authority’s Capacity Fee to pay for facilities that are required for the provision of water service to applicants for new meters within the Sweetwater Authority service area.

Director of Engineering Smyth gave a brief recapped PowerPoint presentation summarizing the Capacity Fee and its history, as previously presented to the Board at the July 26th meeting. Mr. Smyth said that all legal requirements relating to increasing the Capacity Fee have been met. In addition to the required published Public Hearing notices, outreaches were conducted to the redevelopment groups in National City and Chula Vista in order to facilitate their interaction with development in their respective cities, and Legal Counsel has contacted the Building Industry Association. Mr. Smyth reiterated that the Capacity Fee (Storage Assessment Fee) of $300 per residential unit has not been increased since 1978. MWH Americas, Inc. conducted a study and made recommendations on two methodologies – buy in and incremental. The buy-in methodology results in a charge of $2,300 per Equivalent Dwelling Unit (EDU) while the incremental fee calculation results in a charge of $890 per EDU. The average capacity fee charged by CWA member agencies is $3,370 per EDU. It is noted that in addition to the member agency capacity fees, CWA charges a regional capacity fee of $4,313.

Staff recommended the use of the buy-in fee only at this time ($2,300 fee based on 327 gallons per day per EDU) and not apply the buy-in portion. For implementation, single-family dwellings and nonresidential, business, and others at 100 percent of the base EDU, will pay the minimum of $2,300; apartments, multi-family dwellings, and condominiums will be at 58 percent; and mobile homes will be 40 percent. The Authority’s Rates and Rules will be modified to incorporate the new Capacity Fee, and the Fee is subject to staff review on an annual basis. The Fee will be paid at the time of setting the meter, and a process of appeal will be allowed for developers with disputes over the calculations. Modification of the Fee using the incremental methodology may be considered in the future.

With no members of the public in attendance to provide comments, Chair Pocklington closed the Public Hearing at 6:41 p.m.

In response to Director Morrison’s question about how the 100 percent of base EDU was reached for the business and industrial category, Mr. Smyth said that historical water use in the system for each type of business by meter size was extracted to find an average. Director Morrison expressed concern about the impacts to National City, but he said that the redevelopment agencies reported that Sweetwater Authority staff had met with them. They realized this would have an impact but felt this was a fair impact. He thanked staff for explaining the situation to them. Director Doud commented that this was a good time to make this change.

8. ADOPTION OF RESOLUTION 06-10

Upon a motion made by Director Doud, seconded by Director Alkire, the following resolution:

RESOLUTION 06-10

RESOLUTION OF THE GOVERNING BOARD OF SWEETWATER AUTHORITY
INCREASING ITS WATER CAPACITY FEE

was passed and adopted by the following vote to wit:

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

9. FINANCE AND PERSONNEL COMMITTEE (Meeting of August 7, 2006)
The Committee voted unanimously to add Item E, Discussion of Potential Acquisition of Real Property.

A. CLOSED SESSION
In accordance with Government Code Section 54947.6, 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 Doud, that the Governing Board approve an increase in the deferred compensation company match from $1,000 to $1,500 per year for at-will status employees, and that the General Manager be authorized to amend and sign the contract agreements for the five at-will employees. The motion carried.

C. Director Alkire made a motion, seconded my Director Welsh, that the Governing Board award a sole-source contract in the amount of $68,731 to Southland Technology Inc. for the procurement of the Storage Area Network system. The motion carried.

D. History of Reserves (1979-present). Director Welsh complimented Director of Finance Farrow on the comprehensive reserve history report, as it had always been a confusing issue for her. In response to Director Doud’s questions regarding the status of the Administration and Operations Center Reserve, General Manager Bostad stated that this will be addressed in the 2006-07 final budget. The majority of the reserves were created through the annual budget process to meet and address the issues at that time and other reserves are required by law generally related to bonding requirements. All actions on the current reserves as approved by the Board at the previous workshop will be approved with the final budget at the next Board meeting. This was an information item and no action was required by the Governing Board.

E. Director Alkire made a motion, seconded by Director Welsh, that the Governing Board authorize an appraisal of the Eddy property to obtain the fair market value for potential acquisition. General Manager Bostad stated that the intention is to appraise the value of this property on the river stem that flows into Loveland Reservoir and assess its value to the Authority before taking further action. The motion carried.

10. MANAGEMENT REPORT

A. Report of Operations Manager Rogers: Mr. Rogers commended the efforts of Director of Engineering Smyth and his staff on the Capacity Fee study and changes. He believes we have come up with an understandable package that fits well in comparison to the Capacity Fees of other agencies in the San Diego region.

B. Report of General Manager Bostad: Mr. Bostad added his acknowledgement of the work of Mr. Smyth and his staff to reach a Capacity Fee methodology that is straight forward, understandable, fair, and will be much easier to implement with limited controversy. He also drew the Board’s attention to the summary of Sweetwater Authority’s Portfolio and Investment Report as of August 4, 2006. He added that the National City Chamber of Commerce had asked him to join its Board of Directors and lead the search committee for a new Executive Director.

11. DIRECTORS’ COMMENTS

Director Beauchamp attended the Water Conservation Garden Authority meeting earlier today. He reported on the proceedings and advised staff that a Sweetwater Authority logo banner should be prepared. He added that the Garden’s location within our watershed indicated the value to the Authority’s participation in this effort. Director Beauchamp added that he was appointed as a Director of the San Diego Electric Railway Association.

Director Doud read a woman’s comment to her husband as she arrived with an auto with a smashed front end. “And the policeman was so nice about it. He asked if I’d like for Sweetwater to remove all the fire hydrants.”

12. CLOSED SESSION
There was none.

13. ADJOURNMENT

With no further business before the Board, Chair Pocklington adjourned the meeting at 7:22 p.m., to the hour of 3:30 p.m. on August 23, 2006.