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Home My WebLink About2008-07-16 Min - Board , .. REGULAR MEETING July 16, 2008 In accordance with District Code Section 2.08.010, the TDPUD minutes are action only minutes. All Board meetings are recorded on audio tapes which are preserved perpetually and made available for listening to any interested party upon their request. The regular meeting of the Board of Directors of the Truckee Donner Public Utility District was called to order at 6:00 in the TDPUD Board room by Vice President Thomason. ROLL CALL: Directors Joe Aguera, Ron Hemig, and Bill Thomason were present. Directors Patricia Sutton and Tim Taylor were absent. EMPLOYEES PRESENT: Mary Chapman, Nancy Waters, Kathy Neus, Steve Hollabaugh, Steve Poncelet, Neil Kaufman, Bob Mescher, Rosana Matlock, Steve Murphy, Michael Holley and Barbara Cahill CONSULTANTS PRESENT: Steve Gross OTHERS PRESENT: Juanita Schneider and Helen Davis CHANGES IN THE AGENDA There were no changes to the agenda. PUBLIC INPUT There was no public input. DIRECTOR UPDATE There were no Director updates. PUBLIC HEARING The public hearing was delayed until the scheduled time of 6:15 PM. CONSENT CALENDAR AUTHORIZATION TO RENEW INSURANCE BROKERAGE CONTRACT WITH MARSH RISK & INSURANCE SERVICES This item concerns renewing the District's insur- ance brokerage contract with Marsh Risk and Insurance Services for the 2008-2009 insurance year. 2008-09 WORKER'S COMPENSATION INSURANCE RENEWAL This item concerns renewal of the State Compensation Insurance Fund policy for 2008-2009. Director Aguera moved, and Director Hemig seconded, that the Board approve the con- sent calendar. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors aye, by voice vote. SO MOVED 1 Minutes: July 16, 2008 ACTION ITEMS CONSIDERATION OF REAFFIRMING THE OFFICE OF TREASURER, DEFINING THE TREASURER'S DUTIES, CREATING THE OFFICE OF ASSISTANT TREASURER AND APPOINTING INDIVIDUALS TO THE OFFICES This item concerns the reaffirming of the office of the Treasurer, defining the Treasurer's duties, creating the office of Assistant Treasurer and appointing individuals to the offices. Director Hemig moved, and Director Aguera seconded, that the Board adopt the resolu- tions reaffirming the office of District Treasurer, defining the Treasurer's duties and creat- ing the office of Assistant Treasurer to act in the absence of the Treasurer; and appointing individuals to the offices of Treasurer and Assistant Treasurer. ROLL CALL: Directors Sut- ton and Taylor, absent; All other Directors aye, by voice vote. SO MOVED CONSIDERATION OF CREATING THE OFFICE OF ACCOUNTANT, DEFINING THE DUTIES OF THE OFFICE AND THE APPOINTING AN INDIVIDUAL TO THE OFFICE This item concerns the creation of the office of Accountant per the Public Utilities Code and the appointment of an individual to that Office. Director Hemig moved, and Director Aguera seconded, that the Board adopt the resolu- tions creating the office of Accountant and defining the duties of the office; and appointing an individual to the office of Accountant. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors aye, by voice vote. SO MOVED TELECOMMUNICATIONS GROUND LEASE WITH THE CALIFORNIA HIGHWAY PA- TROL. Telecommunications Ground Lease with the California Highway Patrol Director Hemig moved, and Director Aguera seconded, that the Board authorize the Gen- eral Manager to sign the one-year lease extension with the State of California, Department of General Services Real Estate Services Division covering premises located at Ski Tow Hill (Ponderosa Palisades Tank Site). ROLL CALL: Directors Sutton and Taylor, absent; All other Directors aye, by voice vote. SO MOVED PUBLIC HEARING CEQA INITIAL STUDY FOR STOCKHOLM PUMP STATION REPLACEMENT Vice President Thomason opened the public hearing. There was no public comment. The hearing was closed. AUTHORIZING NEW CONSERVATION DEPARTMENT CUSTOMER SERVICE REPRE- SENTATIVE This item concerns a staffing position in the Conservation Department. Director Hemig moved, and Director Aguera seconded, that the Board approve the job de- scription for a Conservation Department Customer Service Representative; and approve - the new position of Conservation Department Customer Service Representative at the sal- ary range #8. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors aye, by voice vote. SO MOVED 2 Minutes: July 16, 2008 WORKSHOPS ADDITIONAL INFORMATION REGARDING METERING OF RESIDENTIAL WATER SERVICES This item is a presentation and discussion of residential metering. BACKGROUND/HISTORY Neil Kaufman and Bob Mescher gave a presentation: • Workshops held on April 16, June 18 and July 2 • Additional Information Requested at July 2 Workshop o Are there any savings from decreased water consumption and well production? o How will incurring additional debt affect the District's debt coverage ratios? • New information o Industry studies typically cite reduction in water consumption of 10% - 20% with implementation of metering o It is assumed that a 10% reduction can be achieved through metering and other water conservation programs • Assumptions: number of customers will increase 1% annually and electric costs in- crease at 3.5% due to inflation • Four cases considered as to impact on conservation o Base Case: no impact from metering or conservation o Delayed Implementation: 4% reduction in water production by 2010 with 6% by 2022, 8% by 2023 and 10% by 2024 o Gradual Implementation: 4% reduction in water production by 2010, increasing by 0.4% annually with 10% reduction by 2025 o Expedited Implementation: 4% reduction in water production by 2010, increasing by 2% annually with 10% reduction by 2013 Case Total Savings over 17-Year Period Base Case $0 0 gallons Delayed Implementation $2.2 million 2.2 billion gals Gradual Implementation $3.0 million 3.0 billion gals Expedited Implementation 1$3.8 million 4.0 billion gals • Debt Coverage Ratios o FY 2008 budget debt service is $1,963,096 o This amount is 21% of Water General Fund revenue o Expedited Implementation calls for $9.6 million, 15-year loan with annual debt service of about $941,000 o At 5.46% interest, the debt service payment is $6.33 per customer per month o If surcharge is $5.88, as proposed, debt service coverage will be impacted by about 0.7% o Sensitivity Analysis of Monthly Surcharge (Expedited): $ 7 for 10.5 years = $6 million, 10 year loan ■ $ 8 for 8.5 years = $5 million, 10 year loan ■ $ 9 for 7.5 years = $4 million, 10 year loan ■ $10 for 7.0 years = $3 million, 10 year loan • $11 for 6.0 years = $3 million, 5 year loan 3 Minutes: July 16, 2008 ■ $12 for 5.5 years = $1 million, 5 year loan ■ $13 for 5.0 years = no long-term debt • Next steps o Board direction regarding implementation timing o Water Department action plan for approval at Special Board Meeting on July 23 o Public outreach plan Public input: • Who pays for the meters- or does the surcharge to the customers cover the meters? • There would only be the surcharge increase to customers- not the additional cost of a meter. • What about a metered rate structure? • Why try to expedite to 2013? • Want reassurance that the surcharge takes care of everything. • Not all for conservation, not for expedited and not in a rush to be charged $13- could swallow $5.88 • 1 do not want to be charged $13- that would push my monthly water bill close to $100- be more prudent and lower the surcharge • OK with the $5.88 surcharge, 15 year loan with project complete by 2013- expedited Board Discussion: • Good example showing expedited, surcharge in relation to length of loan • Wanted delayed so can pay as we go- even in the gradual case, the customer sur- charge was around $5 • Any plan will use a surcharge- it is up to the Board what to charge the ratepayer • Would like to see system go in place as expedited- want done by 2013 • Let's get this done- expedite- does not make sense to do in 15 years • Do quicker to fulfill conservation- new system can give customers additional infor- mation so they can conserve • There is an impact on the community when some people are metered and some are not • Impact on staff as dual billing systems • Cannot find reason to move quickly • Electric and water savings are possible- with savings of water used, may not have to drill another well • Bond is ok if the benefit is long term • Match customer payment with the benefit they receive • Not in favor of a $10 million note- want a "pay as you go" • Understand the concern with expedited implementation • Draw down the loan with a higher surcharge • Hard to hit the new General Manager with a big debt • If stretch out implementation, technology may get better in the future • More conservation on the expedited plan- want all on the system- don't stretch out to 2023 • "Pay as you go": by reducing the surcharge $1.00, one year is added on to completion • A $13 surcharge is too high for customers all at once- $5.50 to $60 would be better 4 Minutes: July 16, 2008 It is not equal between different scenarios- $6 would be enough for a customer increase. • Bond does not bother me. The Board advised staff to draft a Water Metering ;Implementation plan to include Phase 1 (Pilot Program), Phase 2(AB2572 compliance by 2010) and expedited implementation plan (AB2572 compliance by 2025) to come before the Board for review at the July 23, 2008 special meeting. Public will continue to have an opportunity for input. REVIEW OF PROPOSED AMENDMENTS TO TITLE 5 CUSTOMER RELATIONS OF THE DISTRICT CODE This item concerns the proposed amendments to Title 5 Cus- tomer Relations of the District Code Mary Chapman gave highlights of the major changes to Title 5, Customer Relations: • Clarified deposit requirements • Changed deposit retention period back to 2 years • Increased minimum construction related deposits • Clarified language for re-establishing and maintaining credit • Added payment options previously approved by the Board • Clarified when charges would begin, continue or stop for un-metered water accounts • Modified the late payment notice and dispute resolution procedure to comply with current California Public Utilities Code • Deleted sections where the District would finance construction and energy efficiency projects • Removed reference to Public Information Committee • Added section regarding Public Information and Conservation Manager • Removed details of Conservation Rebate Program; • Revised the customer complaint procedure • Increase payback amount to customers that can be routinely handled by department heads Public input: • Agree with the updating- easier to read the new revised document and refer back to the red-lined version for the changes. Board discussion • Would like another workshop in two weeks • Director Taylor needs the opportunity to discuss • Want to discuss further and vote on August 6 • Makes for a usable policy • Is there a reason for the back and forth on the deposit times (12 to 24 months)? 5 Minutes: July 16, 2008 SEMI-ANNUAL REVIEW OF THE DISTRICT'S FINANCIAL PERFORMANCE THROUGH JUNE, 2008 This items concerns providing the Board of Directors with a review of the financial activity and performance of the District's operations through June, 2008. Bob Mescher presented the charts in connection with the semi-annual financial review: • Electric Operating Revenue- includes residential, commercial, interdepartmental o YTD actual $10,256,101 0 12 Mo. Budget $22,770,643 0 45% of budget • Water Operating Revenue- includes residential, commercial, interdepartmental o YTD actual $4,358,116 0 12 Mo. Budget $9,736,422 0 44.8% of budget • Electric Operating Expenditures o YTD Actual $8,932,865 0 12 Mo. Budget $18,101,271 0 49.3% of budget • Water Operating Expenditures o YTD Actual $2,819,555 0 12 Mo. Budget $6,314,406 0 44.7% of budget • Capital Expenditures o YTD Actual $2,049,174 0 12 Mo. Budget $10,781,011 0 19% of budget The Board suggested that staff return with options to bring the budget back in alignment. ROUTINE BUSINESS TREASURER'S REPORT: JUNE, 2008 Approval of the treasurer's report: Director Hemig moved, and Director Aguera sec- onded, that the Board approve the month ended June 30, 2008. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors, aye. SO MOVED. Approval of disbursements: Director Hemig moved, and Director Aguera seconded, that the Board approve the June 2008 disbursements report. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors, aye. SO MOVED. CONSIDERATION OF MINUTES FOR CONSIDERATION OF MINUTES FOR: JUNE 18 AND J U LY 29 2008 Director Thomason moved, and Director Hemig seconded, that the Board approve the min- utes of June 18 and July 2, 2008 as amended. ROLL CALL: Directors Sutton and Taylor, absent; All other Directors, aye. SO MOVED. 6 Minutes: July 16, 2008 CLOSED SESSION CONFERENCE WITH REAL PROPERTY NEGOTIATOR PURSUANT TO SECTION 54956.8 OF THE GOVERNMENT CODE. PROPERTY: 14629 GLENSHIRE DRIVE APN 49-011-29 AND 14630 GLENSHIRE DRIVE, 49-011-31; DISTRICT NEGOTIATOR: GEN- ERAL MANAGER; NEGOTIATING PARTIES: KAPPY MANN," COLDWELL BANKER REAL ESTATE; UNDER NEGOTIATION: PRICE AND TERMS. CONFERENCE WITH REAL PROPERTY NEGOTIATOR PURSUANT TO SECTION 54956.8 OF THE GOVERNMENT CODE. PROPERTY: SIERRA PACIFIC POWER COM- PANY, CALIFORNIA PROPERTY; DISTRICT NEGOTIATOR: GENERAL MANAGER; NEGOTIATING PARTIES: SIERRA PACIFIC POWER COMPANY; UNDER NEGOTIA- TION: PRICE AND TERMS. RETURN TO OPEN SESSION The reportable action for the item concerning the Glenshire Property is as follows: "By unanimous roll call vote of the Directors present, the Board approved an agreement to sell the Glenshire Property, 14629 and 14630 Glenshire Drive, Nevada County APN's 49-011- 29 and 49-011031, respectively, to the Tahoe Forest Church with a 60 day contingency period." There was no reportable action for the item concerning the Sierra Pacific Power Company property. ADJOURNMENT There being no further business before the Board, the meeting was adjourned at 7:57 PM. to n1�J TRUCKgE [ f j,lsl�BLIC UTILITY DISTRICT 411liam Thomason, Vice-President Prepared b Cvt�W(y r y � Barbara Cahiy., Deputy District Clerk 7 Minutes: July 16, 2008