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HomeMy WebLinkAbout1970-09-15 Min - Board 'F TRUCKE&DONNER PUBLIC UTILITY DISTRICT t P. 0. BOX 308 TRUCKEE, CALIFORNIA 95734 t. Tolophom 5874M A G F N D A 5 . FOR BOARD OF DIRECTORS SEPTEMBER 15, 1970 - 7:30 P.M. 1. Roll Call 2. Approval of minutes of September 1, 1970 3. Bills paid and bills for Board's approval 4. Pension Plan S. Leo Todd, County Counsel ) Paul Chamberlain, District Counsel ) 1962 'Beavers Contract Ward. Mole, Attorney for Mr. Beavers Ponderosa Palisades 6. Bid opening - tangy: 7. Manager s Report SEPTEMBER 15, 19 70 GUESTS PRESENT: Messrs. Nace Firpo, C. S. Be-avers, S. Beavers, R. Sutton, N. Dolley, R. Vail, J. Malcomb, G. Pifer, P. Chamberlain, L. Todd, W. Moul, R. Anderson, Mr. and Mrs. Gordon Reddall, Mr. and Mrs. Jack Marquette. 1 EMPLOYEES PRESENT: G. Cattan, T. Paulus, B. Grow, C. Bliss. DOYLE: The regular meeting of the Board of Directors of the Truckee Donner Public Utility District will come to order. The secretary will note that all Directors are present. The minutes of September 1, 1970 will stand approved as written unless there be any errors or corrections. Then it is so ordered. BILLS AND BILLS FOR BOARDS' APPROVAL DOYLE: There is a question about the two Teichert Aggregate bills. Director Loehr is inquiring as to what they are. PAULUS: They are for the breaks in Armstrong Subdivision. Actually there are several of them. We paid them to take advantage of the discount. LOEHR: I thought they were for Smitty's contract. PAULUS: No. i LOEHR: You solved my question. PAULUS: The overtime got a little carried away. We had some storms, and we had some poles de 1 ive re d out to the job site. Naturally the guy came in at 4:00 and wanted to unload the poles. We thought it was best to stay and unload the poles rather than come back in the morning. We had two out- ages at Donner Lake, one this side of town and one at Summit Road. CATTAN: The overtime also includes Friday of last-week. We did the railroad ,•.-; crossing and I asked them to stay over. There was only one pole left to do ` so that's why the overtime is more. LOEHR: I make a motion the bills and bills for Board's approval be paid as listed. ROSE: I'll second that. DOYLE: It has been regularly moved and seconded that bills and bills for Board's approval be paid. Any further question? All in favor, signify by the usual sign. (All ayes.) PENSION PLAN PAULUS: I'd like to introduce Paul Kramer, the field representative of the National Rural Electrical Cooperative Association out of Spokane. He handles about 8 states and 130 co-ops. He is going to give us a brief rundown on a pension plan. KRAMER: This is going to be really rather brief. I don't intend to go into any detail unless you want to ask any detailed questions. I am a represen- tative of the NRECA. I don't work for any insurance company; I am a salaried employee. I have been talking to Tom for some time about the NRECA plans to rural-oriented electric companies. We cooperate with the utility districts. We deal with all types of companies and also with the National Telephone Association and many small telephone companies. The thing that we propose here is a pension plan similar to the ones that are being used throughout the whole Northwest and for that matter through- out the whole United States. Some of the statistics that might be of interest to you; for example, of the REA associate facilities here in California, 4 of 5 have RECA plans. In Idaho, 7 of 11. In Montana, 24 of 25. All participate in the NRECA: Nevada 2 out of 2; Oregon, 14 of is., and Washington 10 out of 18. So there is a total really of all but 14 of the REA facilities who are participating with the NRECA. Of those 14, 13 do have other retirement plans. Twenty-one do not have a retire- ment plan at all. The type of plan we suggested here is a plan that September 15, 1970 Page 161 SEPTEMBER 15, 1970 CONTINUED KRAMER: would call for an original contribution that can be varied. (CONY'D) Generally we are talking about 7.5 0 of the basic salaries of the people who are eligible. The eligibility requirements of course depend upon you people. Generally, we think in terms of three years' service as constituting eligibility. The plan actually does more than provide a retirement income. During the member's working years the plan provides a certain amount of security through life insurance and through benefits that pay through the retirement plan. One of the major features of the plan is that benefits are calculated not on present day salary or averaged out or things such as that, but rather are calculated on the high 5 years of earning i that a man has during his last 10 years of service. So, using this i as a calculation point, we try to keep up with this inflationary thing as we can. One of the things that I think is important -- you will probably ask some question and we do this -- it is certainly because everybody else does it, there is no reason why you shouldn't -but I think you have to have other reasons than that perhaps -- I think that certainly you are going to be able to attract and keep good help with a good retirement program or a good benefit program. You are going to be able to attract people perhaps from other rural f cooperatives, just as they may from time to time attract your people. This actual promotion system within small electrics is bene- ficial to everyone concerned. It is possible to transfer a pension plan from one to the other so the employee doesn't lose anything in the process. You can attract an employee in the same manner, one who is presently participating in a retirement plan can be attracted to Truckee with the idea that he can continue with his pension plan. Believe it or not, generally the cost of a pension plan will be paid for out of reduction in turnover, a more efficient staff. So when j we are talking about cost, we need to look what the total return is. Then too there Is always that problem of what do you do with a guy after he's had 30 years of service, it's time to retire and there is no retirement plan. So this helps solve perhaps all of these problems. One of the other items that I just wanted to briefly cover - the retirement plan that we are talking about here is a contribution of -- approximately 7.7 o that we will need to do a specific proposal. If you plan to do that, I have the necessary data for submittal at a later meeting. One other thing that I would suggest is every elec- tric utility participating in the retirement plan participates also in the long term disability plan. This is a plan whereby you may guarantee your employees 70 0 of their basic income from that date of disability, with 13 weeks of waiting period, until they reach 65. In other words an income 13 weeks after di s ab i 1 i ty so long as they remain disabled, until they reach age 65. This does another thing in that it also pays the cost of the pension plan during the time the man's disabled. This is a two-fold type program, very low in cost, $35/year for employees. We are talking about 70 o guarantee on your salary. I have a booklet for all of you covering the basic retirement plans available to give you some idea what the NRECA offers. In addition to the retirement plans, we have supplemental service pensions, the mutual fund type thing, preferred compensation program, major medical insurance, welfare and disability, which I mentioned. We have group life insurance, direct life insurance, 24 hour accident insurance, j and high limit travel insurance. All of those programs are available through the NRECA. Does anyone have a question? ROSE: Some of the plans., do the employees pay for everything? KRAMER: Yes, your employee would pay an additional 3 o in addition to the 7.7 0 bringing the total cost to 10.7 0. i LOEHR. • 10/7% of his total wages? ' KRAMER: Of his basic wages, yes. It doesn't have to be that high. I'm only talking about one plan that is available. ROSE: That seems rather high. KRAMER: As a matter of fact, that is one of the low rates. The lowest paid plan that we have today is 10.5 0. It's possible to go lower. There is no reason you can't under a supplemental type plan. Under the basic retirement plan the minimum is 10.5 o for both the employee and as the employer. It is a pretty standard rate. Page 162 September 15, 1970 SEPTEMBER 15, 19 70 T CONTINUED LOEHR: Do I understand that you have 10.S% for all the employees and the employer? KRAMER: No, sir. The employer will participate at least 7.S% of the basic wages of those people who are eligible. , It wouldn't be your total payroll. It would generally be somewhere in the vicinity of 70%. We are talking about 7. 7% the employer would pay plus 3% from the employee from his wages, bring the total to 10.S%. DOYLE: As a prerequisite to a participant to your plan, does this mean that we join in NRECA? KRAMER: Yes, sir. DOYLE: What does that entail? KRAMER: First it entails your willingness to join and a membership fee which we will have available for you when we submit our proposal. These things are required. The benefits that you derive will be varied. Pretty much the benefits that you are going to get out of the NRECA are those that you seek. You can make yourself available to them. We have found in { every case a savings you are going to get by participation in the retire- ment plan alone will be more than pay for the cost of your memberships. We are as you know non-profit. DOYLE: Then you will prepare this information and submit it to the Board? KRAMER: Yes, with your approval. What we would like to do is -- I have the available data -- I'd like to submit it based on certain assumptions, mainly the assumption that 7.5% is satisfactory and 3. If a waiting period of 3 is alright, we will work with that in the preliminary proposal. I will put the whole thing together for you. Tom and I have discussed this to some degree. If you need help again, I will be glad to come back. DOYLE: Was Tom acceptable to the 7.5%? KRAMER: Tom thought that was most satisfactory. There is one thing that I might call to your attention. Any participation in the NRECA plan has to be done prior to the first of the year. You can't start in the middle of the year. The only time you can start participation is January 1. So we're going to have to go to work on this rather rapidly. Then you can make your decision. You do have another meeting left? DOYLE: Yes. PAULUS: Let me make one comment. You asked if I was acceptable to 7.S%. I thought the 7.S when it more than doubles the employee's portion is out of line frankly; but it seems to be par for the course. KRAMER: I could read out to you the participation of the other co-ops if you have any interest in that. Just running down this one page -- 7.7, 7.5, 7.0, 7.5, etc. They are all pretty much in line. Some of them may have had a supplementary plan where in Montana for example, the total contri- bution is 14%. They raised the employees to 5 and the employer to 9.5. LOEHR: How many employees do we have now with tenure sufficient to be eligible? PAULUS: 3. Perhpas S or 6. LOEHR: Who underwrites you? KRAMER: Actually the administrator is the NRECA. The bulk of the money is investment funds, the Bankers Trust Company of New York. The only under- writing that's done by an insurance company is for the permanent life insurance, which represents 11% of the total cost. DOYLE: Are there any questions then regarding the District Pension Plan? You will submit your proposal then and we will consider i t. KRAMER: I should have it in three weeks. Thank you. DOYLE: Thank you, sir. September 15, 1970 Page 163 SEPTEMBER 15, 19 70 - CONTINUED 1962 CONTRACT BETWEEN P.U.D. AND C. S. BEAVERS (PONDEROSA PALISADES) : LOEHR: Before we proceed with this, I would like to clear up a matter and I would like to address my question to Mr. Chamberlain. It seems that there is a feeling that I might have a conflict of interest. My posi- tion is that I have nothing to do with Ponderosa Palisades. I am how- ever astockholder in Martis Valley Estates. Mr. Beavers is also a stockholder in Martis Valley. If you feel I do have a conflict, I would like to bow out. CHAMBERLAIN: I can't check the code sections out now. I see that this 1962 con- tract does not have any direct bearing on the Martis Valley opera- I C tion at all. So I think under the code sections, that I recall you f do not have a direct conflict that would have anything to do with this 1962 contract. I think this is a matter of precaution, and an f overabundance of that that because of the tie-in in a different opera- tion with Mr. Beavers., that you have cleared your position and you have indicated and it is now a matter of record -- I think that at your own discretion that you consider not voting on nor participate in other Beaver's matters that concern the Board, and nobody can criticize you for that at all. LOEHR: About this contract? CHAMBERLAIN: Yes. LOEHR: It is included in that statement? i CHAMBERLAIN:: I would think that just because of the tie in in another matter in which Mr. Beavers is involved, that legally I think the conflict of interest sections would show that, were you not a member of the con- tract committee involved here, but involved in another. . .as I say, it is a matter for your own discretion. Legally and technically, you are probably not in conflict, but it is a matter of policy and an overabundance of precaution to give consideration to not parti- cipating or affecting the deliberation, should a vote come up on the Beavers matter. LOEHR: Thank you. I shall comply. I DOYLE: Mr. Moul, you can be seated. Butch, do you want to sit at the table or stay where you are? BEAVERS: I think I can operate from over here. LOEHR: Is it necessary for me to leave the room? DOYLE: No. As everybody knows, there has been much discussion regarding this 1962 contr act.. The Board felt that if we submitted the entire } matter to legal counsel which includes our own attorney for the District and County Counsel, we would be able to come up with some kind of an answer. Paul, I guess you can go from there. You, I assume, have had ample time to review the contract. CHAMBERLAIN: I have gone back over the contract, again as I have in the past. One thing that does bother me is that each time I go over this matter, more letters show up I haven't known about before, and therefore this j is rather a changing picture. I assume that at this point I do have and have had a chance to review all of the documents in the District's records by way of correspondence, copies of letters from engineers: for the District, from the District to engineers and Mr. Beavers, etc. I have also gone back over and read the agreement entered into back in 1962. As I understand the problem, the question of what the agreement meant - you have the working in there "adequate water supply" and "facilities which the District would install to provide an adequate supply at a given point subject to its existing and other rules and regulations". You certainly have a gap of some 5 years, as I recall, from the time Mr. Beavers entered into the 1962 contract till I find a letter in February of 1967 from the District to the engineer for the developer Mr. Beavers, which said that the District f' Pa e 164 September 15, 1970 g I SEPTEMBER 15, 1970 - Continued CHAMBERLAIN: would not supply water until an adequate agreement was entered into (CONT'D) regarding the off site facilities and storage. What in essence we are trying to do is go back by taking subsequent correspondence to determine what may have been the intent at the time the agreement was entered into in 1962 when it said 'adequate supply". Whether it meant water at a j given point or whether it meant water at a certain pressure and volume sufficient to serve the entire 200 acres as I understand is the area described in the agreement, or whether they were talking about an initial phase, etc. This has been a difficult bunch of documents to analyze. I think that, No. 1, the agreement in and of itself is a valid agreement. I wouldn't sit here and say it is not without ambiguity and that the determination of what was meant or intended by the parties of what is an "adequate supply". During my 8 years with the District that have elapsed since then as to the reason what the parties intended, as I have indicated before, my opinion was that adequacy of supply is not a black and white answer, and I can't give you a yes or no answer, that no you don't have to do anything, or that you have to do everything. Leo may have some other comments on this thing. My opinion is one that I am trying to temper somewhat within the attorney's duties to his client as to sort of weigh the odds as to which way to go on a matter of this kind, whether you tell your client to ignore the thing or you may well be telling your client that they are buying a lawsuit. It is my opinion that an attorney does a disservice to his client if he tells him just to ignore the thing knowing that a lawsuit may well ensue. We should know something about what the odds are going to be in that litigation. In my own mind, having read the thing, I don't know that I can give you those odds. I see letters that I think tip the scales in favor of the District. I see some other things that tip the scales in favor of the developer. 'Then as I say, this history of the District doing something, Beavers doing something, letters going out saying don't do any more until we have an agreement and yet the matter never actually being resolved. So, I don't know that I can advise the Board specifically at this point regarding the course that you should pursue. One thing that should be considered again depending upon the desires of the- Board and comment from Leo Todd, Mr. Moul, that I think this should be resolved by some sort of a compromise and avoid a lawsuit if you can. Again, you can lose a law- suit, and you know it's going to be expensive for all parties involved. I can't give you.the odds I think you ought to have at this point to tell you how you don't have to do anything more under this agreement. It's not just that open and shut. STONE: Mr. Chamberlain, you stated that in your opinion you thought this was a valid agreement. How would this statement stand up under litigation? CHAMBERLAIN: I think Leo can comment. I think the agreement itself is a valid contract. Any defense that the District would have that you could say that the whole contract is meaningless and ignore it. There are too many things been done under the agreement that gives the impression certainly that the parties thought there was a meeting of the minds, and that they have been following along with it. Saying it's valid doesn't - I don't intend to say my answer is not without some ambiguity. When you get involved in a dispute or what this word "adequacy of supply" means in that particular paragraph in the contract under the circumstances that we are debating referring to 1962. I don't know whether I've answered your question. As I stated, it is a valid contract. I find no defense, or no reason to say that it is invalid and you can just ignore it or that Mr. Beavers can ignore it for that matter. TODD: Mr. Chairman and members of the Board, I think basically I would agree l with what Mr. Chamberlain stated. ' I think the danger here as to my posi- tion is that I'm coming in cold although I reviewed the contract and correspondence, at least as much as I have in my file. The way I view the problem -- you start out with a valid contract and I assume at this point there is a meeting of the minds. Then as you progress through the corres- pondence obviously this meeting of the minds leaves something to be desired. Apparently there is an attempt to modify, and it looks at one point that there actually may have been an agreement through the correspondence to accept some modification. Then you go farther and then obviously there is SEPTEMBER 15, 1970 Page 165 September 15, 19 70 - Continued TODD: not a meeting of the minds. The correspondence certainly muddies (CONT'D) the situation. I'm with Mr. Chamberlain, I think it would be very difficult for any attorney to give you a cut and dried answer. I feel that it is in the District's best interests to try and work out some kind of a mutual compromise, both for the benefit of the District and for the developer. MOUL: Well, any time someone mentions compromise, it is always well for the opposing party to listen to a proposal. There appears to be no sense in pursuing, as the gentlemen have stated here, vexacious litigation to prove a point if there is a middle ground that we can come to that I personally feel that one thing that has been overlooked here with respect to the intent of the contract. There is no mention of the minutes of 1962. Do those minutes exist? DOYLE: I assume they do. We have minutes for every meeting. MOUL: Well, to my knowledge of the conversations that have been had with the principles who are involved in the formation of that contract, the manager at the time, the Chairman of the Board, at that time,, with Mr. Beavers, there seems to be general agreement amongst those people as to just what was the meaning of that contract. It was discussed at the Board meeting as to what was going to be done by j the respective parties, and it was fully within the contemplation from the information that I have available to me that the District did intend to construct a 1,000,000 gallon tank on the 100,000 square foot parcel that was to be obtained from Mr. Beavers. And that that tank was to supply water to the town of Truckee as well as taking care of the other problems created up the hill. Mr. Beaver's property through the construction of that water tank would be adequately supplied with water in sufficient quantity and pressure so as to be able to develop his entire 200 acres. That there would be no problem other for him to run the in tract facilities, and that was his respon- sibility. But it was the responsibility of the District - they were ..-, acquiring that property for a specific purpose - to construct faci- lities. Now the contract again is vague and ambiguous with respect to "facilities", but there seems to be litt-le doubt but that the District was intending to construct the storage tank at the site they specified. That it must be a minimum elevation of 6,000' . Can you j give me any other logical basis upon which the District would ever want a site at a specific location unless it was for the purpose of constructing a water storage tank. Certainly the electrical power did not enter into the elevation. So that here in the contract itself we have evidence of what was intended by the District and the representations made at that time, and fuly relied upon by Mr. Beavers in giving what is admittedly, I'm sure you people would agree, the most valuable parcel within his entire 200 acre subdivision. Now we have given freely of assets to make this thing go. I think we have been willing to cooperate all the way down the line. Mr. Beavers advanced a significant amount of money to oversize a line in Unit 1. He put in a 10" and 8" facility where a 6" would be very adequate. This has cost him $13,000+. Under a representation from the District that he would be reimbursed for that money. Well, he didn't happen to get that in writing so I don't know how far we can pursue that. We i have the records that he did pay that money out of his own pocket; it was a contribution to the Assessment District that created the other improvements. It was not assessed against the property because it was to be reimbursed. At the same time I might add, that the District supplied materials and did the work of laying the 3" high pressure line in the same location leading up to the 100,000 square foot parcel that was dedicated by Mr. Be avers. Here again, the object is for the District who supplied the booster pump. DOYLE: This obligation that he took upon himself, is this an oral contract that he made between a representative of the District regarding this l $13,000 trust fund? MOUL: This is as we see it, yes. The District in complying with this con- struction stated they did not have funds available at that time, so that it would not hold up his project, he agreed to putting it in with the understanding that he would be reimbursed by the District. I Page 166 September 15, 1970 s SEPTEMBER 15, 19 70 - CONTINUED MOUL: This is perhaps the collateral issue that doesn't really belong in here (CONT'd) other than we claim that this type of action definitely puts the earmarks on what was intended by the parties in 1962. And those people who still remain are available to testify as all indicate that it was the intention of the District to construct a tank on the parcel to be acquired. It was to be a million gallon tank; it was to supply backup fire protection { P rimarilly for the town of Truckee, but at the same time it was also to solve the problem of how do you get pressure into that 200 acres. r— DOYLE: This million gallon tank we are talking about, do you happen to know why j this wasn't written into the contract at the time, if it was discussed in 196 2? i MOUL: No, I cannot tell you why it wasn't written into the contract because Mr. Beavers or myself or any other person representing Mr. Beavers had any hand in actually drawing the agreement. It was drawn I believe by Mr. Chamberlain. CHAMBERLAIN: I wasn't the attorney for the District at the time. MOUL: Whoever the attorney for the District, I'm sorry -- I seem to recall at our meeting in Auburn that it was indicated that you had. . .I must have misunderstood that or my memory is failing me after two years, but at any rate the agreement was drawn by the the then attorney for the District at the District's direction. The agreement certainly does protect the District in establishing time limits for performance and specifies perfor- mance to be made by Mr. Beavers, that in every instance for performance by the District we have an ambiguity. Now, it is a general preface of law that any contract is going to be construed most strongly against the person who draws it. This is the District's contract. DOYLE: There is a question in my mind regarding. . .Historically, has the District ever erected water tanks of this nature? Hasn't the developer always put up the tanks? t.. � a MOUL: Mr. Doyle, if I might answer that, the District actually went so far as to buy a tank, transported it, put it on that piece of property but never erected it. DOYLE: Put it on what piece of property? MOUL: On 100,000 square feet of property he gave to the District. DOYLE: That tank has been near our well facility for years. It has never been moved. MOUL: Well, Mr. Longo, I am sure, indicated to me at one of our meetings that it was the intention to install the tank that I referred to. I'm sorry that I have it in the wrong location, but he did state it was the District's intention to install that tank. DOYLE: What's the size of that tank? MOUL: It was not a new tank; it was a used tank. DOYLE: It was a surplus tank that they bought. MOUL: So, primarilly what we wish now is that we have another unit out here --- that we're trying to develop. We have a program going on that would delay in the processing of that development. It's getting rather encumbering ! and it's going to start costing us some money. The thing that interferes is the refusal of representatives of the District to approve the plan that was approved two years ago. DOYLE: Apparently, as I see it, the whole plat hinges on the water. Is this true? MOUL: Well, there certainly is a problem where as long as the District represen- tatives insist that Mr. Beavers is required to provide storage and pressure facilities to take care of the Ponderosa Palisades development. I might add by the way that well over half of the 200 acres has now passed into September 15, 1970 Page 167 SEPTEMBER 15, 19 70 - CONTINUED MOUL: the hands of third parties. Mr. Beavers has no interest whatsoever. (CONT'D) We are talking now about 47 lots. These 47 lots are being held up - maybe I'm using the wrong word, but maybe I'm using the right word - being held up to provide a facility which is obviously intended to serve all 200 acres. As far as what is needed to take care of the total Ponderosa Palisades for your service unit area 3, I believe is referred to, if that is croterminius with the Ponderosa Palisades, which I have no way of knowing whether it is or not, but if that is the case, I see no way that you can hold up Ponderosa Palisades West Subdivision in order to try to solve the problem in Units 1, 2 and 3. Those are different owners. Those owners if anybody have any respon- sibilities to participate along with Mr. Beavers. Now Mr. Beavers { isn't the only owner in Ponderosa Palisades West. He just happens to be the only face that is consistently here because he is local. I But we are talking about other ownerships. I see no way that you can force this one developer, this one ownership, and we have at least 47 lots, to stand good for everybody else that is involved. II � The problem doesn't center in these 47 lots. That s what we want right now, we want that subdivision approved so that we can carry on a business. DOYLE: We understand. Do you have any letters or communications regarding i this one million gallon tank between you and the District? MOUL: I have nothing in my possession or documents at this time. All I have is communi cat ions, correspondence, not correspondence, but j us t verbal contact with the prople that were involved personally with the transaction, and those people indicate that yes, that was the agree- ment. They coincide exactly with what Mr. Beavers told me two years that it was the intent ago. Mr. Longo tells us the same thing, yes, of the District to construct a tank which was to provide service to the 200 acres. DOYLE: Mr. Chamberlain, do we have any correspondence in our files regarding the District constructing a million gallon tank on this parcel? CHAMBERLAIN: Not from what I can see from what has been supplied me. DOYLE: George, have you come across anything? CATTAN: I have searched. There is nothing, just the contract. MOORE: Did anybody research the minutes? i CATTAN: Yes, I researched the minutes. MOUL: Do you have the minutes going back to 1962? CATTAN: Yes, there is nothing escept the contract. We haven't found anything regarding that tank at all. MOUL: Well, I do feel safe in making the statement that those parties that are available to comanunicate with will reaffirm my statements here tonight. It was within their recollection that it was contemplated that such a facility would be built by the District. i MOORE: Certainly, if it was, it should be in the minutes. CATTAN: We have a letter here, No. 6, February 28, 1967 addressed to Raymond Vail, your engineers, which said: "The improvement plans for water distribution restoration for Ponderosa Palisades, Units 4 and 3 are approved by this District". The last paragraph says: District will not supply water until agreement is reached between the District and developer for cost participation in off site supply and storage development' . MOUL: There is no question that by 1966 the District realized that they had something of a problem in financing their obligation. As of that time, we have done nothing but recalcitate on the District's part approving any of our plans, allowing us to carry on a business, for providing adequate pressure in the system within Ponderosa Palisades. Since 1966, it has been a struggle. Page 168 September 15, 1970 SEPTEMBER 15, 1970 - CONTINUED CATTAN: I don't know why that 3" pipe was installed. It's not going to be used. It was approved by the previous manager, but it has no'value from an engineering point. MOUL: I certainly do not intend to question the motivations of the District to install this pipe, other than it was extended up to the westerly line of Unit No. 1 which is fairly obviously intended to supply some water up above Unit No. 1. They intended to do it through a line that they constructed. It was somebody else's responsibility. Why did the District construct the line? Why did they construct the booster pump if it was somebody else's responsibility? M-- CATTAN: The booster pump has nothing to do with the 3" line. But the word "facilities" has been defined by our water consultants and I have to accept their definition, because I am not a water engineer. MOUL: May I refer that to Mr. Chamberlain for clarification. CHAMBERLAIN: You read through this correspondence as to what facilities are. Apparently an engineer says in his opinion it includes a booster pump, and a storage tank, and Mr. Moul doesn't agree with that opinion. "Facilities" to some may mean something to someone else. TODD: Mr. Chairman, excuse my ignorance. Coming in cold, there are alot of things I don't understand here. Was there an approved set of plans for the in tract water system at the time this contract was entered into? CATTAN: No. I don't think s o. The final plans were drawn later. MOUL: Mr. Beavers indicates to me that yes, there was a p 1 an. CATTAN: We can look at the dates of the plans. TODD: Well, I would certainly think that the plans that were drawn and approved would help to clarify the intent of the parties, at .least provide some answers. DOYLE: What you are saying then that you think that if there was an intent to construct this water facility, it would be referred to in the plan? TODD: Well, either drafted on the plan or it would show if water was certainly ' going to be supplied from some facility. STONE: (Comment from Mr. Stone that land hadn't even been surveyed.) CATTAN: The tentative map was approved June 11, 1962 by the Nevada County Planning Commission. Usually the tentative plans do not show the water system. Isn't that so, Mr. Vail? VAIL: That is correct. CATTAN: The County of Nevada P 1 annin g Commission in letter No. 2, paragraph B, "the subdivider should install or agree to install an adequate and safe water supply in conformance with the general requirements of the water specifications of the Truckee Public Utility District including adequate public utility easements". Even then the Commission in June 12, 1962 did include these conditions. MOUL: Well, that is a standard procedure, has been for years and always will be. I'm sure that they are going to revert for the approval of the water �--- supplier as a condition to their approval of the subdivision map. I wouldn't have it any other way. The contract stipulates that water and electricity CATTAN: p y will be served and will be brought to the exterior boundary of the property. We do have adequate water now and for the future. We have plenty of water, but we don't have the storage. BEAVERS: I have heard that the District Engineer's interpreting of this contract, and this is my Question. Mr. Brien Walters if he knew of the contract, and he said he was not aware of the contract at all. (Reference to call to Dan Co(* who also told Mr. Beavers that he was not aware of any contract.) September 15, 1970 Page 169 SEPTEMBER 15, 19 70 - CONTINUED per,: There certainly can be no question but that the water tank and the M booster pump certainly fall within the definition of a facility. In general, I am referring to one that will be perfectly appropriate for a person to refer to as a facility. But if you say a "facility" does not specifically mean a booster pump or a storage tank. It has many meanings. We have to determine what the person meant when he used that word. I think we can look at the plans for Unit 1 as the thing that was to be installed by the developer. And he did install it. It was approved and accepted by the District. Being maintained by the District. So that I think on his face (?) the requirement set forth in that letter has been met. I would classify that letter as being irrelevant to our problem here. DOYLE: Certainly it is difficult to sit here and try to determine what the intent was in 1962 without those Board members being present. Where E we meet in the twain, I haven't the faintest idea. MOUL: Mr. Doyle, if I might venture a suggestion. I would suggest that the. District do approve the plan we have submitted for Ponderosa z Palisades West and give us a proposal of compromise. Let us review it, and if necessary, we will make a counter proposal. We will try to resolve our problems in this area. If we find an area where we can, within the business operation that we have, cooperate with you in some way. But I can assure you right now that these 47 lots cannot finance an entire improvement for the Ponderosa Palisades development. So, if we are able to work out something, we are willing to partici- pate, but our participation will be on an appropriate basis. We'll work something out. I'm not saying we can. I say we are perfectly willing to sit down and talk about it. But we cannot afford to have this water plan held up. DOYLE: I agree with you there. CATTAN: What about the electric in the contract? Where the subdivider has to build the electric lines? Because the intent of the contract at the. . . --, MOUL: Mr. Cattan, are you straining rather hard to try to find that this i contract is justified? CATTAN: No. 4 I MOUL: You seem to be straining. You seem to have some motivation that I can't fanthom. The attorneys can't find it. CATTAN: On the electric, the developer is supposed to build the lines. Because we do have a letter here. . . MOUL: Shall we recess while I read the electric. I've been concerned with the water. You are talking about the 1962 agreement? Specifically what area? CATTAN: Page 2, paragraph 2. We will extend our facilities to the exterior boundary of the land described. MOUL: Well, Mr. Cattan, all I can say is the District would be obligated to place sufficient electrical current at that point it entered the subdivision to the furthest reaches of the development with suffi- cient voltage so as to be able to supply an adequate supply to each parcel therein. There again, I do not feel this has any bearing on the water. i CATTAN: We are talking about Ponderosa Palisades West. Water and electric. MOUL: Is there any controversy with respect to the electric? BEAVERS: No, not that I can see. This is under an REA grant that all the subdivisions in the entire area are served under this REA contract. We each individually sign an agreement to guarantee a certain amount of money per month Lentil that line is supposed to be paid for. I don't understand. Is there an exception for us? Are we out of the REA grant? Maybe Mr. Cattan can answer that one. If there is I would like to know about it. ' Page 170 September 15, 1970 i i SEPTEMBER 15, 19 70 - CONTINUED CATTAN: Mr. Longo wrote this letter in 1967. If he had the intention of erecting a million gallon tank, he wouldn't be asking you for storage. MOUL: By 1967, which is after 1966 of course, the position of the District had changed. The ability to finance the million gallon tank. . .In 1967 I believe was when Mr. Walters was retained as the engineer of the District, and the whole concept of how the water would be supplied in this water district was changed. I discussed with Mr. Walters the proposed million gallon tank and he had heard of it, he had considered it, but he could see no logical reason to pump all that water all the way up that hill and then drain it back down again with pressure reducers on the way. Within his engineering plan, he felt that it was not satisfactory. He has subsequently I believe given you an alternate plan that does not contemplate the.use of a very large District storage tank located on that site. But in 1962 it was the intent of those operating this water dis- trict that they would have one water tank and it would be located on that 100,000 square foot parcel that they obtained from Mr. Beavers. Then it was the intent at that time which fixed the obligations and rights of the parties under this agreement, not what happened in 1967. You cannot unilaterally go back and change that agreement. STONE: Mr. Moul, I think this explains somewhat Mr. Chamberlain's advice that from 1962 to 1967 there was a lapse of time here between contract nego- tiations and correspondence. It appears to me that this thing j us t layed dormant. MOUL: No, there was action going on at that time. Ponderosa Palisades Unit 1 was constructed, and the District did put in a booster pump. The Dis- trict did put in a high pressure line in the same trench that was used to construct the other water facilities by Mr. Beavers. And Mr. Beavers did enlarge his facilities at the request of the District. We did have a verbal agreement to reimburse. All of this was going on. I am not able to find any correspondence, but there are physical actions on the ground that indicate the District's acknowledgement of the obligation to provide pressure into that system, and it's the intent to put a ..., large water transmission facility up to the top of that hill. STONE: Mr. Moul, and if I may, Mr. Chairman, I'd like to challenge one state- ment here. Mr. Moul said that this tank was to go on top of the hill connecting adjoining property. Reading the contract, I see that Parts of Sections 14 or 15 - I wish to make the statement that at that time Section 14 was National Forest land and does not. . .It does state that _ 100,000 square foot area, but it doesn't specifically lay out the loca- tion. It sets up a system of arbitration after the site was selected. So it looks to me that the location itself wasn't defined let alone how many gallon tank. I think that somewhere's in 960 acres here there should be defined some 100,000 square foot of area. MOUL: Well, of course in the preamble to the contract itself, it refers to land owned by Mr. Beavers in Section 15 and lands proposed for acquisi- tion in Section 14. STONE: I'd like to discuss that too. MOUL: Of course the land at that time had not been surveyed. The exact loca- tions of the various portions of the territory owned by Mr. Beavers was not then known. All of this had to be deferred to a later date when more engineering information would become available, and that is the site selected by the District. It so happened that it happened to be the best piece of land in the entire tract, on top of the hill, the ideal �-- place to put a storage tank. DOYLE.• Before you get on to your next question, Nelson, I'd like to direct a question for former Director Firpo. Do you recall any discussion or correspondence regarding the District installing a million gallon tank in this subdivision? FIRPO: 200,000. DOYLE: But was there some agreement or some meeting of the minds? FIRPO: I don't remember an agreement, but on the discussion of a tank, it was 200.9000. September 15, 1970 Page 171 SEPTEMBER 1S, 1970 - CONTINUED STONE: The question has arisen: Who wrote this monstrosity? Mr. Chamber- lain denied writing it, Mr. Moul has said the District's attorney wrote it. I see here in the first paragraph where it says that Mr. Beavers is in the process of acquiring from the Forest Service adjoining lands in Section 14. This statement here is sort of a problem to contract out lands that could not have been included in a contract. Do you suppose we can research this thing further and determine somehow who the author of this contract was? TODD: Doesn't anyone know who the attorney was in 196 2? DOYLE: Butch, do you happen to know who drew the contract? BEAVERS: I don't know, but I might correct Nelson, by stating that I acquired land from the District in Section 14. The U.S. Forest Service land f in Section 14 is not the only ownership in Section 14. I acquired the land from the District. It was specified there that this tank site is at a certain altitude, and therefore it narrowed it down to the very top of the only hill we have. It was intended to be on that hill because there is no place we would have the elevation, unless we were talking about Forest Service land. E i I STONE: I'm not talking about that question. I'm talking about"and is in the process of acquiring through U.S. Forest Service certain lands in Section 14". BEAVERS: That's right, and I was unable to acquire that but did acquire another piece of land in I was in the process of trying to make j a trade. Other independent operators made the trade. MOUL: Quite frankly, and Mr. Chamberlain will agree with me on this, that this is immaterial to the problem. CHAMBERLAIN: It really doesn't. As I can see the contract is ambiguous but it was a valid contract and it was approved by the Directors. DOYLE. George, did you have any comment?. CATTAN: I have a letter here dated November 1963, No. 4, addressed to the i Division of Real Estate. "Please be advised that this District will serve water and power to subject subdivision. Service is subject to final acceptance of installation facilities by the developer in accordance with the general requirements of the District". That word "facilities" - "service is subject to installation and final facilities by the developer". Facilities has been defined by our previous consulting engineer and by our present consultant as booster pumps, storage, etc. It doesn't mean the pipe line. MOUL: Well, I would certainly have to contest that the word "facilities" necessarilly includes a booster pump. It certainly is not exclusive ofthose facilities, that is true. By the way I might add that you have written letters to the Division of Real Estate that you will supply adequate water and/or fire protection in Units 1, 2 and 3, and I would rather imagine that you assume the obligation to do so by so stating to them in your letters that you will supply adequate water in that system that has been built within that subdivision. Once again, I do not think the use of the word "facilities" in that agreement has an definite meaning without looking behind it to the intent that was in the mind of the individual who wrote it. At that ._.., time there was an approved plan for the construction of certain facilities within Unit No. 1. Those certain facilities did not include a booster pump. They did include an oversized that we prev- iously talked about, but at the same time when that construction was underway, the District came in with their own forces and with their own materials and installed a 3" high pressure line. And a booster pump which was installed by the District. This had nothing at all to do with the contract for improvement in the subdivision. Page 172 September 1S, 1970 SEPTEMBER 15, 1970 - CONTINUED CATTAN: We explained that to you before. BEAVERS: I don't believe you explained anything to me, Mr. Cattan, excepting those things you wish to harrass me with. CATTAN: At the meeting here. We read a letter to you that was delivered to us by REA. DOYLE: What is your specific question regarding the electric? CATTAN: Future extensions in the subdivision. I have a letter here June 1964 that Raymond Vail and Associates say "Enclosed are two sets of proposed electric distribution systems and water system plans. Please return one set to this office with your approval with your recommended changes on the drawing". In 1964 Raymond Vail submitted to us power lines which they want to construct. Plans. And I approved them. Later these lines were built by the District. STONE: Why did that happen? This contract definitely says that we were to build power lines only to the quarter quarter of Section 14 and 15. CATTAN: That's what I'd like to know. I don't have an answer. STONE: Was there money involved? CATTAN: Of course. DOYLE: You are talking about Section what? Unit 1. CATTAN: Yes, about the whole subdivision. And they were built by the District. ROSE: At this point here. This would show the intent of the developer. CATTAN: They understood the intent of the contract then. You could see from the letter. Of which I had dealing with. We weren't dealing with water then. DOYLE: Is this true, Mr. Beavers, that the District built all the electrical facilities? BEAVERS: No, it was paid for. . .Yes, of course, like you do in every subdivision under an REA contract loan. Aren't you doing this now? Do you know in the beginning the REA officials came up to our subdivision. We were instrumental of getting them into the District. They explained to me that they have a policy where they install the power facilities and where we sign the contract to pay a certain amount of money each month. 60 months isn't it? This we have been doing every time we asked for power. We have signed an agreement guaranteeing payment. But this is an REA function. This came out of the grant as I understand it. I have asked other subdividers if this is the way they do it, and this is the way it is being done. I don't know what the problem is. I have been asked to do this. We have been asked to sign an agreement with REA that we will guarantee certain monies. CATTAN: You didn't sign i t. It wasn't the deve 1 ope r. BEAVERS: Every one of the owners. The developer didn't ask for power, the indi- vidual homeowner does. s CATTAN: Tom, would you get that REA letter? MOUL: The agreement for the specific revenues, what we will find that the 1 developer in this case is causing the electrical facilities to be expanded. He's expending money and is obligating himself. Now whether he lets the contract. . .actually as far as construction of the water line is concerned, this developer has not signed the contracts. The county engineer has been signing the- contract and assessing the cost thereof back on the lands. I see that this in no way as being any reflection on a failure to perform by Mr. Beavers. We are raising all kinds of curtains here and naming around in circles, to dig up anything we can, anything at all, that might look in some way that Mr. Beavers is a bad guy. I question your motivation. September 15, 1970 Page 173 SEPTEMBER 15, 1970 - CONTINUED DOYLE: Well, I don't want to go into this part of sitting here and arguing, harassing and talking about this same thing weve been talking about over the years. This District isn't intentionally trying to give Mr. Beavers a bad time. This is certainly not the intention. Now, it's been said over and over again and I'm tired of hearing it. MOUL: Mr. Doyle, let me clarify that. I think there are certain represen- tatives of the District that at times have taken certain actions that certainly have all the appearance of being an effort to inter- fere with Mr. Beaver's business. I'm sorry to have to say that. a DOYLE: Your client is certainly entitled to his opinion, but likewise I am too. I don't happen to feel this. way. However, I would like to I settle one matter before we get into something else. The electric and the water are certainly contiguous, but we are talking about the water first, and I think it's imperative that we resolve one issue before we get into the other. Don't you feel this way? CATTAN: I was just trying to show the intent of the contract and that they understood the contract when they signed it. They did write to us and say to approve the electric lines. i DOYLE: This is exactly why we've invited legal counsel so we can determine or attempt to determine what the intent is, but so far after an hour we haven't been able to do that. MOUL: Mr. Doyle, the best suggestion that I have heard here is that we do try to meet some middle ground. We don't want to litigate this thing for the fun of it, and I'm sure you don't either. If there is an area of compromise that is reasonable and can be worked out, certainly we're willing to try. We will consider it, we will cooperate to the extent that is practical. We are not going to close our minds to it. We are willing to negotiate. Now as to whether we are going to negotiate on what your recommendation is or what your idea is automati- cally -- this wouldn't be a negotiation. We're just not going to stand still and wait for a demand and respond, but we are certainly r--� willing to sit down and talk about it and see if we can work out i some common round that would allow you to o ahead ingood con- science and allow us to carry on a reasonable asonable business. Now in - order to do this, it is necessary that Ponderosa Palisades West plan be approved. If that isn't approved, we aren't able to carry on a business. But we will meet with you, we will discuss it, then we i will try. We will do it in good faith. i i DOYLE: Certainly we will do likewise. MOUL: Fine, then we will need the assurance that we wi 11 have an approval for filing for the in tract facilities so we can go ahead with the development of that unit, and then I suggest that the other matters we have brought up, the other people that are involved in this and the electrical, can then be considered as we have researched, investi- gated and familiarized ourself with the background material on this. I'm sure that you people will want to make your contact with the people who were involved in the making of this contract. You will want to clarify for yourself. I wasn't here. I'm speaking largely from what i I have heard other people refer to. I'm using key words that I've heard other people say. I wasn't there so I'm not a witness. I'm just telling you what we believe to be the truth because of what these people tell us. Mr. Beavers was there. Now he's either lying or else there's someone to support him.We know he isn't lying so we have no fear at all of delving deeper into this thing. a DOYLE: Likewise, I'm sure the Board doesn't have any fear either. i MOUL: So, fine. This is the thing to do. Let's delve deeper into the background - the people who were involved - what they say is the agreement background round and intent of the District, what did the Dis- trict intend to do, what did it tell Mr. Beavers it was going to do? It was told by those people who were operating the District at that time, many of them are still available. But right now we have a problem with 4 7 lots. We don t want it used as a hammer. DOYLE: Paul, do you have a comment? k i Page 174 September 15, 1970 SEPTEMBER 15, 1970 - CONTINUED CHAMBERLAIN: I concur with Mr. Moul's comments on the thing. As you can see, the more you get into the thing, this thing is like trying to unscramble eggs. I don't know whether you've had an opportunity with your engineer to review this Ponderosa Palisades West. As to the question of approval on it. . . . MOUL: We have a letter of acceptance on it with the exception of additional boosters and storage facility. CHAMBERLAIN: The Board can approve that plan according to the engineer's making the approval somewhat conditional on these additional facilities and upon whose responsibility it is going to be, then Mr. Moul and myself , Mr. Todd and whoever else who wants to seek what background information we can and try and come up with some sort-of a compromise or recommendation to make to the Board. TODD: For the mere approval of these p 1 ans, I assume you are going to need a letter from the District that they will supply water, so you are going to be blocked at that point even though the plans have been approved. BEAVERS: If the plans are approved, it would normally mean that they would supply water under this contract. Then the State of California would be satisfied. CHAMBERLAIN: Is this Placer or Nevada County? BEAVERS: Placer. CHAMBERLAIN: This raises an interesting point. According to my record that portion of Ponderosa Palisades that was approved should have been. . . , .procedure drawn up by the Board. r BEAVERS: That's true, but is is covered by the contract. By the annexation into the District as a service area. MOUL: Is this not the usual procedure when it is outside the District boundaries? CHAMBERLAIN: There should have been alot more things in the contract to serve the customers. Individually, we might have contracted on a whole different rate scale., not normally subject to any District taxes, elections, etc. MOUL: Both units and Ponderosa Palisades West are within the territory fully r described in the 1962 contract. What we are really talking about here is a problem of the entire Ponderosa Palisades development. I'm not talking about a problem with respect to Ponderosa Palisades West. There r is not an adequate supply of water in the entire Ponderosa Palisades development. Unit 1 is in need of storage facilities, Unit 2, Unit 3, proposed Unit 4 -- all of these are in need of a storage facility and additional boosters. It is not only Ponderosa Palisades West. CATTAN: I have a letter here August 17 regarding Ponderosa Palisades West from our consultant Mr. Cook saying he recommends denial of Ponderosa Pali- sades West Assessment District until such time as a booster station will be located on Lot 21 of Ponderosa Palisades is complete and provi= sions are made and construction assured for the zone 3 storage reservoir located on the 100,000 square foot parcel provided, Now I have to abide with the recommendations of our consulting engineer unless I am ordered by the Board otherwise. I am not trying to harass Mr. Beavers. I get my instructions from the Board. If the Board instructs me to do the power lines, I'll do them tomorrow. But I won't do them until I Pons get the Board's recommendation because I know the contract and the intent of the contract, and I have been through all these documents. } I find as Manager I cannot do something to which is contrary to the intent of the contract. What was done previously is no concern of mine. VAIL: You weren't here in 1962? CATTAN: No. VAIL: We have had instructions from Mr. Longo to provide a 100,000 square foot area. This area.. .As I have said before, we have plats that indi- cate the area. I'm still looking through some of our old files that I'm sure I have or made at the time. I'm sure that I also had notes about the discussions I had regarding the tank. I have some other notes about meetings here referring to a resolution approving or accepting the tank September 15, 1970 Page 175 SEPTEMBER 15, 19 70 - CONT INUED VAIL: site back in December 1966. So these are reasons I feel indicate the (COW D) intent.. . . . temporary situations. . . .Agreement -is clear that the Dis- trict would supply water to the temporary tank. . . .oversize line in- stalled to put in tank and this line would be extended up to the top of the hill to supply water to the tank. I have 20 or 30 files I've been going through so far, each one of them turns up something new. C TODD: Mr. Chairman, can I ask a question here? Putting some of these pieces m I correct that in Unit 1, 2 and 3 are com together in my mind, a - pleted? The internal water system is in and has been accepted by the District and is being operated by the District. Now, is there MONNOOk adequate water for the users within Units l, 2 and 3? i DOYLE: I believe, correct me i f I am wrong, George, isn't there adequate supply at the boundary line, but there is insufficient pressure? CATTAN: Insufficient pressure and storage. If you want to pump the water, you have got to put it somewhere. DOYLE: The source of storage, then of course would correct the pressure problem? • that's obvious but aren't out in to close the door TODD: I think that Y trying after the horse got away. You owx these facilities. Let's assume that the subdivider left and forgot about this new unit, aren't you obligated by law to supply these people? You accepted the facilities. DOYLE: Absolutely. TODD: They're yours. The subdivider can go home. It would certainly seem to me that it's your problem. Now sure I can appreciate the fact that now we're going to hold this new unit to correct things that happened in the other units. But I wonder how this would look before a Superior Court Judge; how would you explain it. It would be very difficult to rationalize on. DOYLE: That's just exactly why we asked you and these other people to be a here tonight. 1 F TODD: There-may be alot of things here I don't know. The first impression I get listening to the conversations. . . t CATTAN: Unit 3 has been approved on a condition. l TODD: Were Units 1 and 2 approved that way? CATTAN: No. Unit 3 and 4. BEAVERS: Mr. Chairman, I want to apologize for my giving you the impression ., that I felt the Board was dealing harshly with me. I never said that. It is those who operate on their own without the knowledge of the Board. This letter read dated August 17, I called and asked for I an interpretation. In other words, these things are contingent upon line, and I have never heard the Board give me an interpreta- tion. Mr. Cattan continues to write me these letters demanding these things, that it is the contract. . . . .contrary to the contract. These are the things that I feel give us a certain problem. One person, but the Board has never given me any trouble. DOYLE: Isn't it foremost that we get this intent thing straightened out? How are we going to establish what the intent was? -- i CHAMBERLAIN: Go back and try and talk with some of these former Board members and see what their recollection is.- Go back and check the minutes and see if you can find out about the pressure line being installed. Maybe a little time will help fill in some of these gaps as I have i as I read through just the correspondence. DOYLE: I feel we should pull all the stops and find out where the District stands. These people are living up there now without adequate water pressure. That's what it amounts to, and they certainly deserve to have adequate water pressure. Without mentioning anything about i the fire protection. Page 176 September 15, 1970 f i i SEPTEMBER 15, 1970 - CONTINUED STONE: Mr. Chairman, may I make a statement? I fail to see how anyone cannot reason as to the intent of this contract. On Page 2, paragraph 2 the District agreed to furnish water and electric service. Provide service points either at a quarter section corner to the Tahoe National Forest and Utility District Improvement land. Or for some unknown reason to extend the service point area to a point 1600' westerly of this common quarter corner." I am assuming that at October 1, 1963, this request was not done. I see no reason why the District should, have to extend the power at the cost of the people beyond that point. I see no reason why any extension beyond this common point of water and power service should be at the expense of the District. I think this should be a developer development subject to the ordinances and the rules I and regulations of this utility district. MOUL: Mr. Stone, if I may clarify one thing. And I believe this to be correct. I do not believe that the District has expended District money to extend the electrical facilities in these subdivisions. MOORE: I'd like to clear up one point that Mr. Beavers made when he said the money spent is an REA grant. That is no grant. This is a loan and is paid for. Any time we spend that money it's to our expense. MOUL: But you are paid back through revenues. MOORE: It is still a loan. I don't think that Mr. Beavers ought to use that phrase. MOUL: Certainly the residual obligations are paid back and it does go back to the properties, because of their agreement to pay certain fees for a fixed term of time. CHAMBERLAIN: This is a letter dated May 15, 1969 from Mr. Hal Leary, REA, to Francis Longo, a copy of which is attached and is part of these minutes. DOYLE: I still feel we have to get this matter of intent settled before we can proceed any further. ROSE: It certainly wouldn't make sense to me to approve lots in an area where we seem to be not supplying water at the present time, whatever the reason happens to be, until we determine if we are going to do so. MOUL: Gentlemen, I must contend that there is no possible way that you can bind these 47 lots to provide an adequate water supply for the entire 200 acres. You are limiting the ab i 1 i ty to develop this area. You are doing that. You are damaging Mr. Beavers and interfering with his business operation. ROSE: It looks to me as it would only be increasing our problem. MOUL: There is going to have to be in the relatively near future some construc- tion done in that area. It's a question as to who is going to pay for it. ROSE: I think we have to all agree with that as a matter of fact. STONE: Why shouldn't Mr. Beavers pay for that as any other subdivider? Provide the storage -- that's the way our by-laws read. MOUL: It isn't the way your contract reads. STONE: The hell it doesn't. MOUL: Mr. Stone, that is perhaps your interpretation of it. It certainly isn't my interpretation of it. It is not Mr. Chamberlain's interpretation. It is not Mr. Todd's interpretation of it. In the final analysis I suppose if we are getting right down to the agreement itself, we are going to have to go to a court of law to decide exactly what that contract says. Because there is an ambiguity. It may have a meaning that you are going to accept. It does not have that same meaning that I am going to accept, because there is a different interpretation that can be applied to the various words that have been used. It is a loose contract. There is no other way of defining that contract. It is loose and ambiguous. STONE: For that reason, I would think that we would welcome litigation. September 15, 1970 Page 177 SEPTEMBER 15, 19 70 - CONTINUED MOUL: That is your Board's decision. MOORE: I'd like to do a little research on the minutes and talk to former Board members and be a little more surer in my mind as to what transpired. It's something that certainly wouldn't take long to do. But as you say, we are going to have to get together and figure something out. MOUL: Let us assume the District is not responsible. Then who is respon- sible? All of the lands within that 200 acres is responsible, other- wise the Board is going to have to take some other action to create _...1 some other method of financing that encompasses all of the territory that will be met by the construction of these facilities. It will j touch all of the owners of the lands that is touched I cannot see that you have any power to levy a tax on Mr. Beavers for the benefit of somebody else's land. So that if it turns out the District is not responsible, then it isn't Ponderosa Palisades West that is responsible. You already have the problem; it must be cured within a reasonable amount of time. I just propose that you don't interfere with the business operations that's going on there. Don't incur any additional delays. Let us pursue the solution to the problem. You can't do it by just holding things up. Of course, that won't cure your problems in 1, 2 and 3. You're still going to have those problems, and they are still going to have to be handled. MOORE: Why add more to it? MOUL: Because I don't think you really have any more time to de 1 ay. Some- thing is going to have to be done. Somebody is going to have to spend some money. It's either the owners of those lots who are going to expend some money or the District is going to have to expend some money. We have the status quo right now. Something is going to have to be done with Units 1, 2 and 3. You are not providing adequate water in the area. You're collecting $75 a year for fire hydrants that don't work. Now, you have a responsibility there. You're selling fire water that you don't have. What happens when the first 7" house burns? I shudder to think about it. I certainly wouldn't want to be your insurer. I'm sure that I wouldn't be immediately thereafter. So you have a problem as well as we have a problem. Just by adding another 47 lots to this is not going to compound your problem. And it isn't going to make it go away either. ROSE: Seems to me by adding 2, 3 and 4 to Unit 1 was adding to the problem. MOUL: The tank needs to be constructed right now. STONE: That would decrease the available fire flow. It would be depriving other people of the fire flow they have now. PIFER: Mr. Chairman, may I add something to this discussion. I am an assis- tant to Leo Todd. I have had a number of property owners inquire of me on this subject. You've arrived at the area in which I felt there was two parties, Mr. Beavers and this District, that are in jeopardy. This contract was drawn up in which under ordinary circumstances a District of this nature might enjoy some immunity with respect to a suit by the property owners, if you have a confrontation if 47 houses are destroyed. But it was a contract that extended beyond the respon- sibility the District has brought out tonight. The contract to provide water services above and beyond the area in which you would normally have a responsibility. That is a result of the contract between Mr. Beavers and the District, had it contemplated what we attorneys know as beneficiaries. Those beneficiaries are all of these property owners. They are now standing in risk of losing their homes, and you're both sitting here squabbling over whether you might be sued, both of you jointly, by all 47 property owners'. if you have a good fire. MARQUETTE: I'm not interested in a compromise. We have property in this area, and I think Mr. Todd hit the nail on the head. Who owns all these lines in Units 1 and 2 - the District? If so, this developer has to run those lines, to improve those lines. We have a right to have water to build up there, and we are being deprived of this right. Now, Mr. Stone says he thinks it's very plain what this thing (contract) says. Well, I'm going to give you a layman's viewpoint on it. On Page 178 September 15, 1970 i SEPTEMBER 15, 1970 - CONTINUED MARQUETTE: Page 1 it says "the District desires to acquire a portion of land from (CONT'D) said developer for installation and maintenance of utility words for benefit of said District. Now, on Page 2, and as you know this is well defined by fire marshalls, the adequacy of water is sufficient domestic water plus enough water to fight fire They've raised it up to 750 GPM at 20 lbs. pressure for 4 hours. I just got a letter from him on that insurance district. Also "the District has sole and exclusive right to supply us this water until 1988". We can't drill a well; we can't do a thing up there. We've got our hands tied. I'm not fighting the devel- oper's fight. I'm fighting my fight. I'm going to lose a GI loan at 4 1/4 o because of this Board nothing has been done about supplying water out there. I'm upset about it. And this exclusive right runs until 19 88. Back over here on Page 3 here again it says the District wants 100,000 square feet of land for construction and maintenance and install- ation of utility works and facilities and appurtenances thereto. Right down here it says the developer will also provide a road to this 100,000 square feet, for the purpose of ingress and egress and the installation and the maintenance in, on and over, upon the same property. As a lay- man. I figure at the time I read this and when I got this letter, that the District was going to put a water tower up.- I know this is the opinion of alot of people in the area. I would suggest you drive over there and see. I would suggest you get the minutes out and see. Because I feel I've got a case and my attorneys feel I've got a case. I'm sure that some of the attorneys here tonight feel this. But to sit here and talk about compromise and see this thing delaying on out disturbs the hell out of me. DOYLE: It does me too. MARQUETTE: I think it's time to. . .Well, if the thing explodes, I'll tell you this. You're going to have a dog gone hell of a big lawsuit because you know and I know that if the biggest percent of this District does not have proper fire coverage, that you are charging the people through the fire department's tax roll for those fire hydrants and those hydrants are suppossed to have sufficient fire protection for residential and also down in Commercial Row. But we don't have that. DOYLE: That's true, Jack, and I certainly hope that it's the lack of results or the ability of this Board because this condition exists. You know what the situation has been in Truckee historically. MARQUETTE: I know it goes back beyond this Board. But I am also finding out now we've done alot of digging as you know and I find. that this thing appears to be developing into a personality clash. I don't think that Mr. Reddall or the Barringers or Sheldon Beavers who are sitting here and myself should be the result or get caught in the middle of it. And I think you're going to find out that there's a fight going on the Board isn't involved in. REDDALL: Gordon Reddall, owner of Lot 122 in Ponderosa Palisades Subdivision. If I might have an opportunity to comment. On September 1, I presented a letter to this Board and I asked for a reply within 30 days. My advice from my attorney, I am told that I have the basis for a class action against the District in that they did not supply adequate water . . . . . . . should run with the land which is the basis of this document. I would like to address my remarks first to Mr. Moul. My attorney suggests that we not become a party to any action between the District and the developer. That we should take our actions as a third party beneficiary. He says that in no way should we at any time make ourselves responsible in any way or a party to. an agreement where we would be levied for an additional assessment. We have individual assessments. So that if there are other improvements to be put in and you reach a compromise with the developer, j that these cannot be prorated out among all lot owners. Jack Marquette should not have to pay a share nor should I-.. Utilities are in, we are specifically excluded, by the covenants which run with our died and as specified in this contract. I said these words in my letter to you, and I will not read it verbatim because Mr. Stone read the first para- graph and Paragraph 2. There is a second part to that and in Paragraph 3 that "said District shall provide an adequate supply of water". In Paragraph 3 it says that "in consideration of the foregoing, said devel- oper hereby demands on said District the sole and exclusive right, privilege and franchise to supply, transport, in, over and upon and within the said land of developer any and all public water facilities . . . .". What this means is that we have relinquished our right to develop September 15, 1970 Page 179 SEPTEMBER 151, 1970 - CONTINUED REDDALL: water on those properties. As Jack pointed out, we are prohibited (CONT'D) from developing a well, we are prohibited from installing our own water line. We are at your mercy really. We have granted the right through the developer to you and this right continues until October 19 88. My attorney advises me that I must wait a 30 day period which I specified in my letter, and based upon your answer to that letter, I will have a basis for further action. I do advise you not to attain any compromise that would make us a party to further assessment. We will not agree to such a compromise. We will take independent action.. I sympathize with Mr. Beavers. Their problem has no bearing on me or my property. We have a basis for a class action and we intend to carry it forth. Thank you. STONE: Mr. Reddall, are you contemplating that you might dig your own well? r REDDALL: I've contemplated even hauling it up there in a tank. STONE: (Comment not audible on tape.) REDDALL: If that is the recommendation of the Board, I will abide by it. The District is not supplying a proper water supply. DOYLE: Certainly, this is not the intent of the District. I believe you realize that as well as anybody else. Paul, after all these comments and discussions, have you changed your opinion any? j CHAMBERLAIN: No, I've gone along with Mr. Moul's comment. I don't know how long it would take to develop this background information. It doesn't seem to me that there shouldn't be a great deal of time consumed because there isn't a whole lot of information. There are contacts I think that should be made and information that I think should be j made available to the Board. I appreciate your dilemma. If we approve Ponderosa Palisades West with the condition that these additional facilities and attorneys recommendations to be installed, I don't know that you've done any particular service to the developer with that kind of a condition on it. If you approve more plans, you're going to have the same condition there. �--� DOYLE: Well, certainly, you can see that these people have a problem. The District has a problem and it's our obligation I believe to extend Ithe service to that which they are paying for. CHAMBERLAIN:: I have some thought and without having the benefit of an engineer's comment, I'd like to talk again as to the for Units 1, 2 and 3. That's where the inadequacy is at the present time. i CATTAN: 3 and 4 will be solved when the new tank is going up. (Discussion regarding maps on table not- clear because several people talking at once.) i CHAMBERLAIN: How soon will that facility be met? CATTAN: As far as I could tell, they mentioned that the foundation will be within. . . . .before the snows. And the tank will be next April. CHAMBERLAIN: It seems to me that without having the advantage of your engineer ►, here you have the thing tied down with this new tank that will part- ially solve the problems in Units 1, 2 and 3. MOUL: Mr. Cattan, is that for area No. 2 tank that you are talking about? I CATTAN: This tank is going on elevation 6,100' . I REDDALL: Mr. Chairman, the elevation of my lot is 6,200' . MOUL: I believe that's the system that will take care of Sierra Meadows. Now who's going to pay for that? DOYLE: That's just what I was asking. Sierra Meadows is paying for that. Will this particular tank that's going on the Herzog property, is that going to benefit Units 12 2 and 3? Is this going to give them ! adequate fire protection and water? (Answer from Mr. Vail not audible on tape. Several discussions at once.) Page 180 September 15, 1970 SEPTEMBER 15, 1970 - CONTINUED CATTAN: You've got water here. You could pup it from down below to here. MOUL: It eases the problem; it doesn't solve it. CHAMBERLAIN: The reason I raised the question, it seems to me without the benefit of engineering. . .this in turn as I see it determines a commitment on whether or not you can make a commitment on Ponderosa Palisades West if you see a solution in the irrmlediate future for Units 1, 2 and 3. It's either on the books or has been approved that the facility plus engineering on top .,, of the hill is going to cost X dollars. It appears Mr. Beavers has to have an answer as to whether or not we can serve Ponderosa Palisades West until you have the storage. One engineer says yes, one impartially, and I don't know what Dan says. BEAVERS: Would this map be of any value to you? In this area you have something like 1,000 acres. The plan for Ponderosa Palisades was designed with an oversize line. This tank site right here that we've deeded to the Dis- trict actually gravity pulls this whole area. Before we get to Ponderosa Palisades West, we have 80 acres, 170 acres, 320 acres. . .600 lots sold without any storage whatsoever. As my engineer Mr. Vail says, putting a tank there is not going to solve our problems at all. It may solve General American's problems. Or someone down in here. There is only one place to solve our area's problems and that is by that tank site right here. The reason we designed this heavy duty line with regulators is that it is supposed to go across the river and hook in with the main town. This is what they discussed. MOUL: We are going to have to plan Ponderosa Palisades West approved subject to all our lawful obligations under or in your Resolution 7006 that go beyond the District's responsibility in the 1962 agreement. DOYLE: Is that acceptable? MOUL: Whatever they may be. DOYLE: Mr. Cattan has written to Jim Malcomb regarding this same thing. (Letter read by Chairman Doyle.) Now, is that sufficient to go ahead and grant them approval? MOUL: I have modified that somewhat. Lawful obligation of the developer under 7006 above and beyond the District's obligation in the 1962 agreement. It leaves it all hanging up in the air, but it certainly does acknowledge that if you're not responsible for something under that resolution, if the resolution is enforceable. . . . ROSE: Well, I think something similar to this is what we went along with 3 and 4 on. It looks to me as if 3 and 4 got us in deeper into our complica- tions with this agreement. I still think if we don't have the water there to supply it, I sure can't see somebody start selling lots and maybe someone next week start building a house. MOUL: Well, Mr. Rose, I think that the problem has progressed to the point that something must be done. And quickly. ROSE: I think so too. MOUL: If something isn't done quickly from what I hear here this evening, you're going to be sued by some property owners. It isn't a case where sufficient and adequate supply of water can be deferred for some length of time. Something is going to have to be done quickly. Not so with Unit 3. It wasn't done and should have been done. At the time when we secured the approval, we assumed the District would pursue the matter. DOYLE: Something should have been done in 1962. MOUL: There is no longer any time to delay. It's going to have to be done now. You've got third parties involved in this who will not let it lie. All I'm saying is we should be allowed to carry on our business in the area subject to what our responsibilities are. . If we're responsible under Resolution 7006, we're responsible. We'll accept that condition. That is, we are responsible there if you are not responsible under the agree- ment of 1962. September 15, 1970 Page 181 SEPTEMBER 15, 19 70 - CONTINUED ROSE: But you're going to be selling lots in the meantime before you find out if you're responsible or not before we do anything about it. MOUL: I don't dontemplate that we are going to have the subdivision ready for lots for sale before we solve the problem. We can't let it lay. You can't let it lay. The property owners aren't going to. REDDALL: The best things are often heard in outside halls and on the back stairs. There was an offer made at the outset concerning a compro- mise. Nobody likes to use the word "compromise". But I think of the word "compromise" as an accommodation of different views. How- ever, I think Mr. Beavers and his attorney did seem to be receptive to some sort of an offer. The proposal I just heard out in the hall j and I won't identify the speaker, was that perhaps the developer i would be willing to pick up his prorata share for the 47 lots he now wishes to develop and that that just might be enough to enable the District to pick up the other costs necessary to put in the tank on top of the hill. This is an accommodation of different views, and you should discuss a solution wherein the District would be willing to prorate the costs. f MOUL: When you speak of Ponderosa Palisades West, we are not prepared to enter into such an agreement tonight. I'm not sure this is at all what I had in mind. I made the statement and certainly this would have to be done with investigation, consultation and view just what we can do. Actually that sounds to me as far as Ponderosa Palisades West is concerned, that we are assuming the entire obligation and the District has none. That isn't a compromise - it's just our paying the bill. DOYLE: Well, there have been numerous comments and suggestions, and I don't j think we're any closer to the solution. STONE: I have one comment that might clarify one part of this. What the orig- inal intent might be. The hilltop sight was first contemplated when I got into. . . .coming from across National Forest lane. (Next part of comment not audible on tape.) At the time this thing was written, I am quite sure there was no contemplation. . . .Now to continue, I have a question for our attorney. I am quite interested in these allega- tions that we are going to be sued. . . .as to fire responsibility. I've been a fire officer for almost 40 years. This is the first lawyer I've heard that the District was liable for fire protection. I would like to pursue this further and see if the P.U.D. is obligated to furnish i a fire flow. In my business as a forest officer, I can't see what would be done. . . .underwriters. f CHAMBERLAIN: Without a chance to research it, as I would report back to you, it is my understanding that if you are malting a reasonable effort to supply ' the water or meet the needs -- you may not measure up to the standards that the fire marshall may set, but may not be all that the people like, take reasonable means to do the best you can with finances and i time permitted to perform your duties. There are comments here tonight f that you immediately undertake a program to remedy the whole problem or you may be liable for someone's house burning down. Without researching it, I think that's going a little stronger than the law impose as an obligation on a utility. To specifically answer your question I cannot sit here and say that if you do not. . . . .you are liable. I feel you are not in that position. I'll research it and report back to you. i MARQUETTE: Mr. Chamberlain, may I add that I did research this thing. The "` general rules that you mention do not include this contract. Your obligation to serve water is stipulated in that contract. That is not the PUD's responsibility in its ordinary terms. i DOYLE: The problem of adequate supply and source of pressure in this area has got to be solved and this obligation rests upon this Board. We can go on arguing and bickering for the next 10 years and get nowhere. We certainly have an obligation to the property owners regardless of who they are. Page 182 September 15, 1970 I SEPTEMBER 1 S, 1970 - CONTINUED CATTAN: Mr. Moul, as I stated before, the putting up of this tank by Sierra Meadows is more than half the work because we are getting closer to the other tank. We have been pushing this very, very hard to get that tank. Finally,we got it. Because you can never pump from here right to the top. You have to pump to this 2SO,000 gallon tank by Sierra Meadows. DOYLE: Let's only have one conversation going on at one time. (comments between Mr. Cattan and Mr. Vail re maps not audib 1 e on tape.) �..., BEAVERS: 60' from the end of the line that we installed in Unit No. 1. CATTAN: Yes, but you have some pipes going up. (further discussion - noise of maps being shuffled on tape.) • Is this going to be supplied by independent pipe? CATTAN: No. (Many conversations at once at this point.) DOYLE: Probably the cost of putting a tank on that higher elevation would be? CATTAN: 40 or SO thousand. Actually by having the other tank we have 2,000' . ROSE: That's for the tank. The lines, pumping would have to be added to the cost of the tank. CATTAN: I wrote a letter to Raymond Vail, and I said that Ponderosa Palisades West will be approved in accordance to Resolution 7006. Then in the last paragraph I said, perhaps a meeting between you, Mr. Beavers and myself could resolve the problem. Let me know what time is convenient. That letter was written August 6, 19 70. I never had a reply. I was going to solve the problem before bringing in the attorneys, but. . . BEAVERS: This was after I appeared before the Board and asked them for their �--, interpretation of the District's stand. I would rather put my matters before the Board than rely on some independent conversation out in the field. DOYLE: This is exactly why we are here tonight. CATTAN: If we did something, it would be done through the approval of the Board. I never do anything, I never promise anything. Everything comes through the Board. Sometimes it facilitates things to do preparatory work for the Board. DOYLE: Apparently there have been things said that have not been documented. This other tank will be completed in the spring? CATTAN: If the weather is good, they might finish it this fall. LOEHR: Is that a metal tank? CATTAN: Yes. LOEHR: Is the figure you gave us also for a metal tank? CATTAN: Yes. Mr. Vail says it is $40,000 for the tank. STONE: That's still alot of money for a guy paying a minimum of $6/month. There has to be a tank up there someplace, There's a tank up there right now. CATTAN: Yes'. but, you are referring to the first one. The pipes, so you can take from that one to the other one, but it should be done as soon as possible after the other one is finished, and when that is finished. . . . . DOYLE: Does it have to wait for the other one to be finished? CATTAN: No. September 1S, 1970 Page 183 SEPTEMBER 1S, 19 70 - CONTINUED DOYLE: Can they be done simultaneously? CATTAN: Yes. DOYLE: I'm wondering Paul that perhaps we should pursue this angle of approval and solve the legalities afterwards? CHAMBERLAIN: There is certainly no harm to be done, before making any commitments to expend $25,000 or $30,000 to know who is going to pay for it. As far as getting some engineering detail on this, what you are talking about otherwise is time spent between the District and Engineer. . . CATTAN: We are talking about $SO,000 including boosters, lines, etc. The tank will cost in the vicinity of $30,000. CHAMBERLAIN: I would like to see some engineering data first. It would behoove j the Board to investigate some means by which it could finance this. Investigate the engineering and financing problems at the same time. DOYLE: I still think we should proceed along the lines of resolving the problem as soon as possible and worry about who's going to pay for it later. We have a responsibility to the property owner and this is where our first interests should lie. Do you concur? CHAMBERLAIN: Going back to Mr. Moul's suggesting of approving Ponderosa Palisades West, I assume there is an engineering fact to provide adequate supply to Ponderosa West. You have the problem in 1, 2 and 3 in talking about this second tank, if you approve it on the condition that subject to the effect that Resolution 7006 is going to affect this obligation. . .the door is open. . .whose responsibility is whose. .. you're going to end up in a compromise somewhere in between. i LOEHR: How do we go back and pick up the escaped assessments? I have refer- ence now to all the lots in Sierra Meadows and elsewhere and even in Ponderosa Palisades, you can't go back and pick up. . . CHAMBERLAIN: I would think all the possibility is. . .what you'de have to do is decide this engineering question first to how much direct benefit this facility would be to Sierra Meadows, how much to Ponderosa ` ` Palisades, how much would it benefit District-wise to fire protec- tion, etc. . . . .should comply. . . .we are talking about the total amount expended over the reason of is it conceivable to set a differential xP up in your water service rates because of the additional cost expended j additionally and not required as such, or perhaps you will have to go back and establish a connection charge to those properties that have not now been connected to the line but would come along and connect as a means of reimbursing the District for a service provided to a specific area along with District wide benefit. You could recover some expenditure in this fashion. You won't recover it all, because facilities of that nature have district-wide benefit. The District should pay for it. LOEHR: This doesn't have anything to do with anybody, so I don't think the conflict of interests would enter here. I don't see yet how you can go back and pick up the escaped assessments. There are a number of them. CHAMBERLAIN: Assessments to me are one thing, I wonder. . . . LOEHR: Not assessments as far as taxation, but connection fees. We can't { very well charge the developer who has sold out and gotten out. How- ever, the people to be benefited are in this particular area. You can't go back on your developer; you have to back on the people. i CHAMBERLAIN: I would have to determine as to whether or not you could adopt an ordinance that would justify a reason as to why you have a different fservice charge for water in Area A and another in Area B. The thing f may be challenged. It has been done, and you do have a redecoration (?) . I would stay away from a legal assessment district to go back and pay for something at the county's expense. I Page 184 September 15, 1970 SEPTEMBER 151, 1970 - CONTINUED LOEHR: That is one of the things that is complicating this. You can see that. Even though we catch the new people and charge them and they immediately say well, you didn't charge some of us as you did me. MOUL: Mr. Chamberlain, if I might add, I'm sure you'll find that there are numerous, various methods by which you can make charges against properties which are legally enforceable. Very often you will find that they are politically untenable. So if you're asking how do we go back politically and solve these problems, perhaps Mr. Chamberlain would like to take it on, but ordinarilly this is not the function of counsel. �- DOYLE: Again, the proposal has been made that, by Mr. Moul, that perhaps some- thing be started along this line to get the ball rolling with further research to determine where the responsibility lies. Again, I add that we do have this responsibility and something has got to be done. There is no question about it. STONE: I move that engineer Dan Cook be authorized to proceed with a feasibility study. DOYLE: With regards to what? STONE: With regards to the installation on the high site tank to. . . . . .for the next 10 years. CATTAN: Did I understand you that in Ponderosa West you are accepting our policy 7006? MOUL: Not exactly. There is a motion on the floor. DOYLE: Director Stone has moved that the consulting water engineer be authorized to proceed with a feasibility study - a feasibility cost study - to determine the cost of a second tank on the upper site. MOORE: I think this is understood. CATTAN: Yes, but we need a motion to authorize this expenditure. MOORE: This is for the size of the tank? CATTAN: Yes. ROSE: Will this study be in conjunction with the lower tank? DOYLE: I would think so. STONE: This appears to be the only way to get it up there. VAIL: Your engineer Mr. Cook already has this study as to the size of the tank. DOYLE: He should be able to provide us this information in a short period of time. ROLL CALL: Rose, aye; Loehr, abstain, Stone, aye; Moore, aye; Doyle, aye. DOYLE: Motion carried. So ordered. CATTAN: If the developer will accept our Resolution 7006 and Ponderosa Palisades West approval will be no problem. MOUL: Mr. Catt an, let me correct you. We are not in so many words assuming that we have a responsibility under Resolution 7006. We are willing to take the approval of the plan subject to whatever our lawful obligations are under that resolution, if the District is not responsible for those same obligations under its 1962. agreement. If the 1962 agreement is binding upon the District, then we have no obligation to construct faci- lities under 7006. The District has the responsibility. Then whatever the force and effect of 7006 is must apply to us. We will accept that condition, but also conditioned that if the District has a responsibility, we don't. We don't want to say that yes, we are going to do whatever it says in that resolution regardless of what the District's prior obliga- tions are. Our obligations are in controversy admittedly. September 15, 1970 Page 185 SEPTEMBER 15, 19 70 - CONT INUED SHELDON Is it inconceivable to solve the problems of the property owners in BEAVERS: an interim measure with one of three. . .The District not only inves- tigate the top tank site as proposed, but to go ahead and build it subject to Mr. Moul's proposal, the subject of this contract. This way this District that is supposed to serve us all with water can accomplish its purpose subject to Mr. Moul's proposal. DOYLE: I think this is the proper course to follow. As far as the legalities are concerned and whose responsibility lies where. . .if it's necessary to be tested in a court of law, I guess that's the way it will have to be. But I do think that we should make some step to proceed with furnishing these people with adequate water without any further delay. Then we'll test the legality of it afterward, if that's necessary. CATTAN: I would like to say that if the Resolution 7006 is accepted, then you have 45 lots, and 50 lots for water source - that's 2,250.00. Storage has been fixed at 500/gal/lot. That's $2,250. And the booster pump. . .you don't have to pay. . . . Ponderosa Palisades West will not be charged for the 600' . We charge in proportion to the remaining how many units you will have in the future. . .it will be a i very small sun. That can go on for the next. . . . . MOUL: We would be responsible for this $4500 plus a prorated share of the booster pump? The District is not obligated and we do not agree on. . . CATTAN: It makes a total of $5000. We will not wait for the rest. I will recommend to the Board that we go on with this line and the tank straight away. I have just made the proposal, and it is up to the Board to accept it. This will solve the problem once and for all. MOUL: Mr. Chairman, if I might add, this conclusion necessarilly implies the District has no obligations whatsoever to Ponderosa Palisades West by the 1962 agreement. This is Ponderosa Palisades West assuming 100 0 of the obligation and throwing away whatever rights might exist under that agreement the way he described it. DOYLE: I certainly think, and Paul will bear me out, this original agreement must enter into it. ; CHAMBERLAIN: I would think so, at this point. If the District is responsible, then Ponderosa isn't. You have to weigh $4,500 against $45 or $50 thousand. CATTAN: We are talking about 50,000 and we only get 5,000. The District has to bear this in mind. The District has to bear this responsibility and provide the financing. DOYLE: You have heard the proposal. MOUL: I think the best thing is to proceed with the thought that something has to be done, and the liabilities should lie where they are, and they are controlled by your ordinances and by this agreement. We are perfectly willing to accept approval of the plan of Ponderosa Pali- sades West so that we can proceed with the development. It's going to be perhaps a year before the construction is completed, but we must proceed now. We need that approval as a step in the process of completing this project. If we don't get it, it's more than a year it's delayed. Delay is money. So we are willing to accept it condi- tioned upon whatever the legal obligations are. DOYLE: I see no reason why we can't proceed on that basis. CATTAN: That means we go on with this before you get your subdivision ready. It is to benefit the existing subdivisions. i DOYLE: What he's asking for is approval of this additional parcel based upon what we've discussed based upon the original agreement. Is there any reason why you can't give the go-ahead? Why can't they have the go- ahead on this additional parcel, this 47 lots of Ponderosa Palisades West based upon the strength of Resolution 7006 in relation to the original agreement? Which apparently is going to have to be researched with them and tested if necessary. Is there no reason why we can't give them this condition? Page 186 September 15, 1970 I SEPTEMBER 15, 1970 - CONTINUED CATTAN: I want to have an understanding because what I can see going through the old correspondence a unit has always been approved and with a restriction on it that they have to supply this and that, an it is never done. We signed the agreement, and we don't want this to continue. DOYLE: This is precisely what we are trying to avoid. CATTAN: We should come to a full understanding and put a stop to this. DOYLE: Won't this take care of it, Paul? CATTAN: Abide with Resolution 7006 and we start from here. i CHAMBERLAIN: As Mr. Moul indicated, they are not ready to go that far at this point. They will not accept the approval of Ponderosa West on the basis of their responsibility of 7006. Their proposal is that you approve Ponderosa West subject to the effect of Resolution 7006 and the agreement of 1962. MOUL: I think it might be phrased that Resolution 7006 minus the agreement. CATTAN: I'm not an attorney, but why do we need the 1962 agreement? 1 CHAMBERLAIN: Because they are relying on it as such. i MOUL: I contend that it creates duties within the District. In those duties the District discharges our duties under 7006. If that is the case, the District is responsible under the 1962 agreement; we are not responsible under 7006. Gentlemen, am I correct? I say that if the District is responsible we ultimately agree either amongst ourselves or in a court of law as to what the obligations are, that will decide what the obli- gations are under 7006. DOYLE: If we proceeded in this direction and gave you that right to proceed based upon these comment s, would this get you going? MOUL: Yes., it would. DOYLE: Is there any reason why we can't do it this way? CATTAN: I would like to see Resolution 7006 adopted for Ponderosa Palisades and the 1962 agreement to be voided. CHAMBERLAIN:: They won't accept that. DOYLE: You can't do it. The 1962 agreement is talking about the entire area. CATTAN: Policy 7006 will be adopted for the rest. LOEHR: It can't be. DOYLE: You still don't understand, do you? Why can't we give them the approval to go ahead based upon these.conditions? Then if we have to test it in a court of law, let's test it. CHAMBERLAIN:: If they're willing to go along on that basis, I don't think you're exposing yourself any more risk than you have right now. Approving it on those conditions. DOYLE: If it is determined that the District is liable for the whole thing, we're not going to be any worse off than we are right now talking about it. We're not getting the job done. CHAMBERLAIN: I would think that before you spend any substantial amounts of money one or all of us had better come up with some answers as to who is responsible. I rather see this solved before any major amount of money is spent. DOYLE: We're going to have to do something, there's no Question about that. MOORE: If you do, you're going to have to raise the rates. Do you need this approval tonight? MOUL: We would certainly appreciate it. It's going to be a long time before you meet again. Page 187 September 15, 1970 SEPTEMBER is,, 1970 - CONTINUED CATTAN: We did approve it subject to Resolution 7006. MOUL: What we are saying is that we will assume our legal obligations that actually accrue to the developer - we will assume them. Now, if we have no obligations, we will do nothing. If we do have the obliga- tion we will pay. If we compromise someplace in between, then we have resolved the problem. CATTAN: If they do not accept 7006, we are right back where we started. DOYLE: That's true but with the stipulation that they are willing to go along with apparently some sort of test of this agreement or compro- mise or conclusion. This is going to have to be worked out between legal counsel. CATTAN: That has been done for the last S years. Going .through the corres- pondence, they have been approved, but subject to an agreement which has never. . . . ROSE: Most of these have been a letter written by Longo or something like that. DOYLE: You have heard legal counsel state to the District that this would be acceptable, and counsel in behalf of Mr. Beavers states that this is acceptable to him, so what's your pleasure? STONE: I don't want to do anything. DOYLE: Do we know how much money the tank's going to cost? CATTAN: We should consult Dan Cook. ROSE: I think we should decide definitely that we're going to put that tank up there or if it's going to be up there before approving any more lots in the area. If we can decide tonight that that tank is going to be put up there assuming that's possible, I see no reason not to go ahead with the 47 lots. DOYLE: • It's just a matter of logic - we know it's got to be up there. ROSE: It needs to be a decision of the Board that going they're oin to do this. Before I would vote on the other things. I MALCOMB: I wish to make one comment with regard to the engineering. I am not familiar with what area is covered by zone 2 and 3. I don't know the high and low elevations are, but I think you could ask your consulting engineer to investigate the feasibility of possibly constructing one tank at the top and having your booster pump on Lot 21, sufficiently sized to pump the water up to that point, and it may be . . . . . .zones 2 and 3 but maybe a pressure reducing station may have to be installed y P g Y 2/3rds down the line. Maybe your expenditures would be less and this would provide a stop a solution and then 10 ears from now, the r r � r � Y second tank can be installed and lesser electricity expended so you j would have to pump the water way up to the hilltop an extra 1001 . That might he advantageous at this time. DOYLE: We had that same question asked several months ago. ROSE: We've discussed that at two different meetings already. DOYLE: I don't see why we can't admit the fact that the thing is needed. We've authorized the consulting engineer to proceed with a study to determine the cost. Is there no reason why we can't give these people the assurance that there'll be another tank there or as soon as we can get one there and allow them to proceed based upon the discussion here tonight. CATTAN: We are at the same situation as we were b e f ore. MOORE: That's true, George. Now, something's going to have. . . . CATTAN: We should settle this matter once and for all. i Page 188 September 15, 1970 SEPTEMBER 15, 19 70 - CONTINUED DOYLE: That's just exactly what we are trying to do. CATTAN: This has got to be solved quickly so that we can get the design, etc. MOORE: The possibility of their not putting up a storage tank in time was discussed before, that we would put it up and collect from them. DOYLE: I would like somebody to move that this tank will be conceded with in all due haste and that the legalities of the contract and resolutions be tested and discussed between legal counsel. MOORE: I think that should be after we get a report from Dan Cook, which should be in the near future. CHAMBERLAIN: They would like Ponderosa West approved subject to the effect of Resolu- tion 7006 tempered by the agreement of 1962, whichever prevails, or a compromise, that's how it's going to be paid for. If you go on record as approving that motion. . . . . .the tank study, the approval they are=- requesting I assume is with the realization that it developed that if the developer is responsible for this thing, we. . . . .I think the developer is fully aware of that. STONE: In my motion, I did not contemplate the approval of servicing of Ponderosa West. MOORE: Personally, I'd rather wait until our next meeting or a special meeting to approve these plans. ROSE: I'd be agreeable to a special meeting. DOYLE: Why do we have to have a special meeting to determine if we need a tank up there when we know we need it? I don't care if it costs 10 million dollars, we still know we need it. REDDALL: I would like to address the chair and Mr. Moul. Irrespective of Ponderosa Palisades West, we need that water now. Jack Marquette is going to lose a 4 1/4 o mortgage because of this and he's going to have to build on that lot at a 9 0 or 10 o mortgage. He intends to sue the District for a long term contract for the difference in the interest. I intend to sue the District if I don't get a satisfactory answer within 30 days of a speci- fied period. We need the water now. I put in a driveway, I've dug the foundation; I can proceed no further. The construction costs between this fall and next year are probably going to be increased, and I intend to sue for the difference in costs. I think every moment of delay is going to result in greater liability on the part of the PUD. MOORE: This has no bearing on the plan that is up for approval. REDDALL: The plan is hinging on what happens with the tank; we need the water at my lot right now. MOORE: We started proceedings on that with a motion prior to this, that is to contact Mr. Cook immediately and get his suggested sizes, etc. That has no bearing on Ponderosa Palisades West. MOUL: If I may tie this together, it appears that the reluctance of the Board here to act is based upon your determination as to whether you do need and are going to build a tank. Whether someone is going to build a tank. Whether there should be a tank up there, whether we should approve Pon= derosa Palisades West. And yet we are also talking, as Mr. Doyle has I—, said, the tank is needed right now. The tank cannot be avoided if you avoid Ponderosa Palisades West. MOORE: I'll agree with this, that we need a tank immediately. I would like to wait to have a special meeting to approve these plans for Ponderosa Palisades West. We could research minutes, etc. and I'd like to be a little more better informed before I. . . . . MOUL: Well, I made the offer that if the 1962 agreement is not binding on the District, we are liable under 7006, or whatever the lawful obligations may be. September 15, 1970 Page .189 SEPTEMBER 15, 19 70 - CONTINUED DOYLE: That's why I can't see anything further delaying this. MAUL: We agreed right now that the 1962 agreement was not binding on the District; we are responsible in accordance with Resolution 7006. I'm saying that if this is the case . . . . . MOORE: I realize this. MOUL: I think it's shameful that you people are going to cause us the j additional expense that a month's delay will cost us. f t MOORE: We have a meeting in 2 weeks. j MOUL: Even 2 weeks is detrimental for us. Every day is significant with what we are doing. We have commitments to be done; we are in contact with financing people who are on the move all the time. We have to go ahead with this project just as soon as possible. You people are once again standing in the position where you can f cost us an awful lot of money. If you are costing- us money by breaching your agreement, I'm going to have to recorrmlend to my client that we pursue collecting it from you. You are damaging us. STONE: . . . . .$40,000 or $50,000 worth of public money for a private subdivi- sion for power supply. CATTAN: Mr. Moul, I don't think that 2 or 3 weeks is going to make that much difference. The correspondence on Ponderosa Palisades West says September 14, 1966. BEAVERS: If we go two weeks, we may miss our entire season. CATTAN: 1966. This has been dragging for 4 years. Two weeks will not make that much difference. MOUL. Are you inferring that the entire procrastinations in this matter are the entire responsibility of Mr. Beavers? CATTAN: No, I'm not saying Be avers. 1 MOUL: You re s aying he's the one who's suppos ed to pay the b i 11. i CATTAN: No, this matter of Ponderosa Palisades West has been going on since 1966. MOUL: Yes, but then you're saying that we should delay this matter and let Mr. Beavers pay whatever bill incurs because of this delay. MOORE: When did we get the letter for the approval of the plans? i j CATTAN: August 6, 19 70. DOYLE: You've heard legal counsel state that there is nothing wrong with proceeding with the approval based upon whatever opinion is generated. . . MOORE: I realize this. I'm not trying to work a hardship. I might change my mind. This was my personal pleasure. STONE: If we approve Ponderosa Palisades West, does this obligate us to serve 47 lots right now? MOUL: I think you would incur generally somewhat of the same obligation you have in Units 1, 2 and 3 except for the fact that you would also have this conditioned by the collection of whatever fees you are legally entitled to. It is different from the others to that extent i that yes, you are presently under obligation I believe to provide adequate water in 1, 2 and 3 and by approving the plans.., you are assuming obligations in 4 and Ponderosa Palisades West. MOORE: How soon would you require water to Ponderosa Palisades West? f I MOUL: For the improvements to that district. If I Page 190 September 15, 1970 I SEPTEMBER 1 S, 1970 - CONTINUED MOORE: I move we approve the plans for Ponderosa Palisades West contingent upon Resolution 7006 and the original agreement. ROSE: I'll second that. ROLL CALL: Rose, aye; Loehr, abstain; Stone, aye; Moore, aye; Doyle, aye. DOYLE: I hope everybody understands now that the Board is acting in good faith, that if it is ne oessary for the Board to pay for the cost of this other tank, that's what the Board will do. I think it is up to legal counsel to work this out between the two of you as far as legalities are concerned and advise the Board at a future time. MOUL: Do you want to make some investigations? If you will contact me, we will get together on them. DOYLE: I think this is the only logical way to do it at this point because obviously there is a difference of the mind. MOUL: Thank you for your time. (Mr. Moul left the meeting with Mr. Beavers.) REDDALL: Thank you, gentlemen. I would like to compliment you on the manner in which you have approached this very difficult problem. DOYLE: As I have stated before, we do realize there is a problem there. It should have been resolved in 1962 not in 19 70. REDDALL: I think you are all to be commended for the very deliberate method in which you have explored this to arrive at a proper solution. DOYLE: I am sure we will. Mr. Todd, what do you think at this point? TODD: I think the motions made and passed haven't put you in jeopardy in any respect. Quite frankly, as I stated before, you have accepted the other units into your system. Let's assume that Mr. Beavers walked away and didn't do any other developing, you obviously are going to have to serve �...., these people. I hope with Mr. Chamberlain I can help him determine the intent. DOYLE: I think that's the first thing that needs to be determined. I'm sure that the intent of the Board at that time was good. I don't see how it could be any other way. As times change different ideas enter into it. TODD: I find that this problem is not unique to this Board. You have to go back to the history of Nevada County to all your water districts, planning commissions, boards of supervisors, nobody knew anything about the prob- lems that were going to come. We've all been educated as time went by. MOORE: I feel then that they would have the same opinions then as we have now- that we don't have the proper policies. But the way the contract was phrased it is not clear and doesn't give protection. LOEHR: There was a slight difference at that time, Bob. They were very very anxious to have people come in and develop land. MOORE: They were still considering developers with storage. BID OPENING: SURPLUS TANK Mr. Doyle explained that this unassembled tank was bought for the District by Mr. Longo at a price of $1,000. Only one bid was submitted as follows: William Ross, San Francisco $2 9100.00 l The proper notices have been posted and published in the paper. A motion was made by Mr. Loehr and seconded by Mr. Stone that the $2,100 bid from Mr. William Ross be accepted. ROLL CALL: Rose, aye; Loehr, aye; Stone, aye; Moore, aye; Doyle, aye. Motion carried. So ordered. September 15, 1970 Page 191 SEPTEMBER 15,. 19 70 - CONTINUED MANAGER'S 'REPORT An aerial photo of the Martis Valley Dam line was shown. The road has been graded by Perini and the District has the approval of the Joerger easement. The District will start on the Trout Creek crossing, which has been held up by the County. No further business to come before this Board, a motion was made by Mr. Rose and seconded by Mr. Loehr that we adjourn. All ayes. Meeting adjourned at 11:19. PAUL A. YLE,-PRESIDENT OF THE BOARD i CAROLYN BLI , RECORDING SECRETARY j i i i i 4 i i i I Page 192 September 15, 1970 TRUCKEE DONNER PUBLIC UTILITY DISTRICT GENERAL FUND Bank balance 9/2/70 $219 356.68 Deposits 25,758.67 Approved billings $13,111.21 Sierra Sun (adv.) 21. 75 Alpine Smith (Keiser Ave.) 49143.15 E. B. Sinclair (refund) 7.14 T. McMaster (labor) 25.92 I Teichert Aggregates 108.26 Calif. Assoc. of Employees (ins) 365.10 (17,782.53) SEPTEMBER 1 PAYROLL: O.T. GROSS NET Cattan 700.00 591.50 Burdick 94.45 60S.73 513.23 Silva 60.78 599.78 540.78 Paulus 550.00 459.S0 Grow 94.89 515.48 420.59 Reynolds 56.40 470.00 375.24 Archer 32.00 417.12 386.48 Straub 13.22 379.32 289.42 Bliss 215.00 202.53 Howell 246.40 197.31 Pine 246.40 192. 71 (4,169.29) 351.74 4.4945.23 Bank Balance 9/15/70 25,163.S3 BILLS FOR BOARD'S APPROVAL KTRT (adv) 45.00 Dearman Backhoe (hauling sand) 44.00 A. Carlisle (office exp) 98.30 Siri Office Equip (office exp) 9.69 Truckee Hdwe & Rent (misc) 8.87 Sierra Pacific (power bill) 18,547.24 Delta Lines (freight) 16.17 Sun Printing (envelopes & forms) 217.88 Specialty Oxygen Service (welding) 9.19 Osburn's Garage (line truck & Chev.) 301.18 Truckee Donner Disposal (garbage) 6.00 Truckee Tahoe Lbr. Co. (metal-Prosser booster) 205.55 Ken's Tire Service (meter reader PU) 58.28 Standard Oil Co (pump oil) 18.59 Teichert Aggregates 104.91 Walters, Ball, -Hibdon & Shaw (balance due) 11579.59 (21,270.44) Balance after payment of above billings $3,893.09 I September 15, 1970 Page 19 3