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HomeMy WebLinkAbout1975-06-24 Min - Board ,]IjNE 24, 1975 The Special Meeting of the Board of Directors of the Truckee-Donner Public Utility District was called to order by the Chairman at 7:45 p.m. ROLL CALL: Waters, present; Sutton, present; Wilson, present; Anderson, absent; Craig, present. EMPLOYEES PRESENT: Hobensack and Kinzie OTHERS PRESENT: Joseph Q. Joynt, Attorney RATE STUDY PROPOSAL The Board received copies of a rate study proposal from Arthur Young & Company. Director Sutton moved that the meeting adjourn and she requested an executive session to discuss a matter which would involve District personnel . Director Sutton later stated that she was willing to discuss the subject in open session. Mrs. Sutton stated she believed some improprieties were involved in the Manager' s informal request to R. W. Beck by June 3, prior to Board authorization of the rate study porposals on June 12. She indicated the Board discussed with Arthur Young & Company on several occasions in the past the need for the rate study and that it would be done by them. Mr. Hobensack responded that he did not intentially give anyone any information, but he did discuss with R. W. Beck and Arthur Young that he was going to propose to the Board that a rate study be conducted in the near future. When the Board authorized the rate study, Mr. Hobensack called R. W. Beck and Arthur Young. R. W. Beck indi- cated they would have the proposal ready when needed; however, there was no one available at Arthur Young's office to prepare a rate study on the day Mr. Hobensack contacted them. Director Sutton felt it was unethical for anyone other than the Board to decide another proposal would be asked for. Mr. Hobensack remarked that he did not ask for a proposal until the Board indicated they wanted proposals. Mrs. Own"% Sutton felt the Board had previously indicated to Arthur Young and Company that they would do the rate study when it was to be done. Discussion ensued regarding the rate study. Mr. Craig indicated he was displeased with Arthur Young in the way they handled the billing on the audit overrun. Director Sutton stated that she and Mr. Craig were aware of this overrun from a meeting they had with Arthur Young on May 5. Mr. Craig did not think it would be a 100/ overrun. During that meeting, Arthur Young discussed the overrun with Mr. Craig and Mrs. Sutton and it was billed at their suggestion. Director Sutton stated that on April 21 during a Special Meeting with Arthur Young an indication by some Board members was made that they wanted the additional research done in connection with the audit to clear matters up. Mr. Craig did not think it would be of that magnitude. Director Sutton thought the amount quoted during that meeting May 5 was between $4,000 and $5,000 for the Dart contracts alone. She did not recall other figures. Directors Craig and Wilson indicated they were interested in receiving a rate study proposal from R. W. Beck in addition to Arthur Young's, and that it was not an improper act by the Manager. Mrs. Sutton thought the error made was in the fact that an alert was made by the Manager to R. W. Beck and a commitment made to them. She said she feared the relationship between the District and the accounting firm had been destroyed. Director Sutton thought the Board should establish what its concerns are regarding their rates other than how munch money is needed to balance the accounts. Director --• Craig thought this would come out In the preliminary study that would be conducted and was proposed by both R. W. Beck and Arthur Young. Mr. Craig indicated that the manager was dissatisfied with Arthur Young. Director Sutton felt the Board is the only one that has to be pleased with a consultant. She stated the Manager has to get along with the consultant. Mr. Hobensack stated he did not think he was doing anything improper by alerting R. W. Beck to the fact that a rate study was forthcoming, and that he would make every attempt to avoid another situation that has resulted from this. Page One - June 24, 1975 TRUCKEE-DONNER PUBLIC UTILITY DISTRICT POST OFFICE BOX 309 TRUCKEE, CALIFORNIA 95734 TELEPHONE 587-3896 �JUNE 2 0 , 19 75 THERE WILL BE A SPECIAL MEETING OF THE BOARD OF DIRECTORS OF THE TRUCKEE-DONNER PUBLIC UTILITY DISTRICT ON TUESDAY, JUNE 249 1975, AT 7: 30 P.M. IN THE CONFERENCE ROOM OF THE DISTRICT. AGENDA: PROPOSAL(S) FOR RATE STUDY TRUCKEE-DONNER PUBLIC UTILITY DISTRICT BY: AUL HOBENSACK, MANAGER PH:mhk yq J Rate Study . . . continued Director Sutton stated the problem with consultants submitting proposals is that the Board does not take the time to define the scope of the work they want done. This results in receiving proposals that are not what the Board wants. She felt this is what happened with the R. W. Beck and Accounting studies. This puts both the District and the consultant at a disadvantage. The Board discussed various ways to implement a rate increase such as taxes; bonds; loans; rate variances; increased rates, connection fees, and minimums, etc. The alternative ways to increase revenue would be established in the preliminary phase of the rate study. Mr. Joynt recommended that the award of the rate study should specify an amount as maximum expenditure; and a clause that states if there is any indication that the cost will exceed the maximum amount, they have to get authorization from the Board. There was additional discussion regarding the audit overrun. Regarding Bidding Requirements, Mr. Joynt stated the Rate study would not be subject to the requirement of obtaining competitive bids. Fosten Wilson asked if the Board would be required to obtain bids for a billing machine when the Board makes the decision to purchase one. Mr. Joynt did not think this bid law was applicable but would advise the Board of any changes in his opinion. * * * * * * * * * * * * * * There being nothing further to be discussed on the Rate Study Proposals, it was moved by Director Wilson and seconded by Director Waters that the meeting adjourn. All aye; so moved. The Special Meeting of the Board of Directors was adjourned by the Chairman at 8:45 p.m. TRUCKEE-DONNER PUBLIC UTILITY DISTRICT BY. JOHN CRAIG, CHAIRMAN r r MERR LYN KINZI. RECORDING S RETARY r f�1