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Home My WebLink About2017-09-12 - Board of Directors Meeting Minutes (B) 2017-178 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS REGULAR MEETING Tuesday, September 12, 2017, 6:30 p.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The meeting was called to order at 6:38 p.m. 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL DIRECTORS PRESENT STAFF PRESENT J. Wayne Miller, President Marc Marcantonio, General Manager Al Nederhood, Vice President Brett Barbre, Assistant General Manager Andrew J. Hall, Director Steve Conklin, Engineering Manager Phil Hawkins, Director John DeCriscio, Operations Manager Brooke Jones, Director Gina Knight, HR/Risk and Safety Manager Delia Lugo, Finance Manager Art Vega, Information Technology Manager Danielle Logsdon, Associate Engineer Kelly McCann, Senior Accountant Marcus Millen, Records Management Specialist ALSO PRESENT Andrew Gagen, Partner, Kidman Law LLP Tom Lindsey, Councilmember, City of Yorba Linda Robert Porr, Senior Vice President, Fieldman Rolapp & Associates 4. ADDITIONS/DELETIONS TO THE AGENDA None. General Manager Marc Marcantonio noted that additional materials related to Item Nos. 9.1., 9.2. and 9.3. had been distributed to the Board and made available to the public. Minutes of the YLWD Board of Directors Regular Meeting Held September 12, 2017 at 6:30 p.m. 1 2017-179 5. INTRODUCTIONS AND PRESENTATIONS 5.1. Elected Official Liaison Reports Councilmember Tom Lindsey commented on correspondence from a member of the public submitted to the District and copied to City officials related to the City's vacation of a landscape maintenance easement on the homeowner's property. President Miller asked General Counsel Andrew Gagen to provide a report out of Closed Session from the special Board meeting held prior to this meeting. General Counsel Gagen stated that no action had been taken during Closed Session that was required to be reported under the Brown Act. 6. PUBLIC COMMENTS None. 7. CONSENT CALENDAR Director Hawkins made a motion, seconded by Director Hall, to approve the Consent Calendar. Motion carried 5-0. 7.1. Minutes of the Board of Directors Regular Meeting Held June 27, 2017 Recommendation: That the Board of Directors approve the minutes as presented. 7.2. Minutes of the Board of Directors Regular Meeting Held July 11, 2017 Recommendation: That the Board of Directors approve the minutes as presented. 7.3. Payments of Bills, Refunds, and Wire Transfer Recommendation: That the Board of Directors ratify and authorize disbursements in the amount of$652,947.64. 7.4. Terms and Conditions for Water Service with Terra Culinary, Inc. Recommendation: That the Board of Directors approve the Terms and Conditions for Water Service with Terra Culinary, Inc., Job No. 201730. Minutes of the YLWD Board of Directors Regular Meeting Held September 12, 2017 at 6:30 p.m. 2 2017-180 7.5. Claim for Damages Filed by Nicholas Estanislau Recommendation: That the Board of Directors reject the claim filed by Nicholas Estanislau and refer it to ACWA/JPIA for further handling. 8. ACTION CALENDAR 8.1. Engineering Services for Asset Management Plan (AMP) Update Staff explained that proposals were solicited from five firms for consulting services to update the District's AMP, three of which responded. Following examination of the proposals and fees, the District's Review Team recommended award to Carollo Engineers. Discussion followed regarding staff's ability to update the AMP in-house following completion, metrics used for ranking the proposals, and the timeline for completion of the project. Jeff Decker (resident) commented on information made available to the responding firms prior to submission of their proposals. Staff clarified that the same information was provided to all prospective firms. Director Hall made a motion, carried by Director Hawkins, to authorize execution of a Professional Services Agreement with Carollo in the amount of $131,875 for consulting services for the 2018 Asset Management Plan, Job No. 2017-15. Motion carried 5-0. 9. DISCUSSION ITEMS 9.1. Reserves Policy Ranges/Goals (Miller) Staff reviewed the District's restricted and unrestricted reserve accounts, associated calculations, and suggested minimum, maximum and target levels. Discussion touched on the purpose of each reserve, revisions to the proposed levels, factors considered by credit rating agencies, potential issuance of a customer refund, minimum days of cash on hand, and reclassifying the Employee Liability Reserve as restricted. Staff was instructed to revise the financial reserves policy for Board consideration at a future meeting to reflect the minimum, maximum and target levels as presented and reclassify the Employee Liability Reserve as restricted. Minutes of the YLWD Board of Directors Regular Meeting Held September 12,2017 at 6:30 p.m. 3 2017-181 9.2. Management of District's Unfunded Accrued Liabilities (Jones) Staff reviewed the District's unfunded accrued liabilities and suggested pay down strategies. Discussion touched on establishing a policy for funding the District's Other Post-Employment Benefits (OPEB) Liability and participating in a program offered by the Public Agency Retirement Services (PARS) to prefund the District's Public Employees' Retirement System (PERS) Liability. Staff was instructed to prepare a 5 and 10 year pay down schedule for the OPEB Liability and a 5, 10, and 15 year pay down schedule for the PERS Liability for Board consideration at a future meeting. 9.3. Disposition of Annual Net Income and Potential Customer Refund (Jones) Staff explained that Fitch Ratings had agreed to analyze the potential impact on the District's bond rating should the Board determine to issue a customer refund. Staff reviewed a checklist prepared with the assistance of the District's financial advisors based off Fitch's rating criteria for above- standard performance. Staff recommended the Board consider utilizing the remaining portion of YLWD's net position for FY17 to pay down the District's OPEB Liability rather than issuing a customer refund. Discussion touched on whether the potential refund would be one time or considered on an annual basis, recent and anticipated commodity rate increases from OCWD and MWDOC, financial impact of potential legislation related to climate change, and possibly expanding the District's sewer cleaning activities. Discussion continued regarding the options presented to the Board and recommendations made by the Ad Hoc Citizens Advisory Committee (AHCAC) as related to the issuance of a customer refund. Jeff Decker (resident) commented on the District's historical annual net income, previous water rate increase, and the AHCAC's recommendations in regards to a customer refund. Discussion followed regarding the method for calculating and issuing a potential customer refund and requiring reaffirmation from Fitch of the District's AA rating prior to issuance of same. Jeff Decker (resident) commented on the District's previous and current business model. Staff was directed to present the options discussed for the disposition of the remaining portion of the District's net position for FY17 for Board consideration at a future meeting. Minutes of the YLWD Board of Directors Regular Meeting Held September 12,2017 at 6:30 p.m. 4 2017-182 9.4. Budget to Actual Reports for the Month Ending July 31, 2017 Staff provided a brief overview of the statements and the amortization of certain pre-paid expenses. 10. REPORTS, INFORMATION ITEMS, AND COMMENTS 10.1. Directors' Reports None. 10.2. General Manager's Report Mr. Marcantonio asked each of the managers (or their designee) to report on activities within their respective departments. He noted that a legislative update would be distributed via e-mail and reminded the Board of an upcoming event. 10.3. General Counsel's Report None. 10.4. Future Agenda Items and Staff Tasks None. 11. COMMITTEE REPORTS 11.1. Interagency Committee with MWDOC and OCWD (Miller/Nederhood) ■ Next meeting is scheduled September 28, 2017 at 4:00 p.m. 11.2. Joint Agency Committee with City of Yorba Linda (Miller/Hawkins) ■ Next meeting is scheduled September 18, 2017 at 4:00 p.m. at YL City Hall. 11.3. Joint Agency Committee with City of Placentia (Miller/Nederhood) ■ Next meeting yet to be scheduled. Minutes of the YLWD Board of Directors Regular Meeting Held September 12,2017 at 6:30 p.m. 5 2017-183 12. INTERGOVERNMENTAL MEETINGS The Directors reported on their attendance at the following meetings. 12.1 SWRCB Briefing — August 23, 2017 (Jones/Miller/Nederhood) 12.2 OCSD Board —August 23, 2017 (Hawkins) 12.3. ACWA Region 8 Water Reliability Program —August 24, 2017 (Nederhood)* 12.4. MWDOC Water Policy Forum —August 30, 2017 (Jones/Hawkins/Miller/Nederhood) 12.5. WACO — September 1, 2017 (Miller) 12.6. ISDOC Executive Committee — September 5, 2017 (Nederhood)* 12.7. MWDOC Board — September 6, 2017 (Nederhood)* 12.8. OCSD Operations Committee — September 6, 2017 (Hawkins) 12.9. OCWD Board — September 6, 2017 (Jones) *No Directors attended these meetings. 13. BOARD OF DIRECTORS ACTIVITY CALENDAR 13.1. Meetings from September 13 — October 31, 2017 The Board reviewed the activity calendar and made no changes. 14. CONFERENCES, SEMINARS, AND SPECIAL EVENTS 14.1. ACWA Region 5 Tour— September 17-18, 2017 ACWA Regions 9 and 10 Tour— October 6, 2017 OCWD Groundwater Adventure Tour — October 26, 2017 YL State of the City Address — November 2, 2017 ACWA/JPIA Fall Conference — November 28, 2017 ACWA Fall Conference — November 28 — December 1, 2017 CRWUA Annual Conference — December 13-15, 2017 Minutes of the YLWD Board of Directors Regular Meeting Held September 12, 2017 at 630 p.m. 6 2017-184 Director Hall made a motion, seconded by Director Hawkins, to approve Director attendance at these events if desired. Vice President Nederhood requested the following meeting be added: LAFCO Municipal Service Review Stakeholder Meeting — October 19, 2017 Director Hall made a motion to approve Director attendance at these events, including newly added meeting. Director Hawkins seconded the motion which carried 5-0. 15. ADJOURNMENT 15.1. The meeting was adjourned at 9:49 p.m. Marc Marcantonio Board Secretary Minutes of the YLWD Board of Directors Regular Meeting Held September 12,2017 at 6:30 p.m. 7