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HomeMy WebLinkAbout16 Annexation of Parcels Donner Lake Agenda Item # 16 Workshop To: Board of Directors From: Peter Holzmeister Date: March 31, 2006 Subject: Annexation of parfels in Placer County at Donner Lake Why this matter is before the Board: This matter involves annexation of parcels on the south side of Donner Lake in Placer County. Annexation of parcels requires Board approval. History: Several parcels of land on the south side of Donner Lake in the vicinity of South Shore Drive are in Placer County and receive electric and water service from TDPUD, but are not officially part of our District. We have served electricity in that area since the 1960s when we acquired the power lines and customer base from Sierra Pacific Power Company. At that time the District did not annex the Placer County parcels involved in the transfer from SPPCo to the District. More recently TDPUD has begun to serve water to that same Placer County area. New information: We have encountered a problem. The Placer County parcels are subject to the assessment associated with acquisition and reconstruction of the Donner Lake water system. Under normal circumstances the assessments are included as a line item on the County property tax bill. Placer County tax collector has told us that it is not possible to collect the assessment because the parcels are not included in the official Truckee Donner PUD territory. Without being officially include in our territory there is no Placer County tax code to use to place the assessment line item on the tax bill. If Placer Count does not collect the assessment we must make other arrangements to bill the assessment at additional cost. Therefore, I wish the Board to consider annexing the parcels. Sauers Engineering has helped us process annexations in the past. Keith Knibb is familiar with the District and has performed a wide variety of engineering services for us over a period oaf several years. I asked Keith to provide a proposal to help us submit an annexation application to Placer County. A copy of that proposal is attached. Keith will be able to attend the meeting on April 5 and can describe the entire LAFCo process. Recommendation: This is a workshop item so not formal action is required. This is a chance for us to informally discuss the entire annexation matter before making a decision. Sauers Engineering, Inc. Civil & Environmental Engineers g March 13, 2006 Mr. Peter Holzmeister, General Manager Truckee Donner Public Utility District P.O. Box 309 Truckee, CA 96160-0309 SUBJECT: LAFCO ANNEXATION APPLICATION FOR DONNER LAKE SERVICE AREA IN PLACER COUNTY -PROPOSAL FOR PROFESSIONAL SERVICES Dear Peter: This letter is our proposal to provide professional services related to the preparation of an Annexation Application for the portion of the Donner Lake service area located in Placer County. The area proposed for annexation was included in the District's Donner Lake Assessment District No. 1. Although the District has long been serving electricity to this area, Placer County is requiring the District annex the area into the District's service territory before Placer County will put the water system assessments on the property tax rolls. Nevada County LAFCo is the principle LAFCo for the District, but because the area to be annexed is in Placer County, the annexation will be processed through Placer County LAFCo. Scope of Services We will prepare the LAFCo Annexation Application including attachments. We will complete the application form and provide the required attachments including map of the service territory, legal description, resolution of application, statement of justification, public notice list, property tax exchange information, general District information and background, and CEQA compliance documentation. We expect to work with the District in obtaining background information for determination of the proposed annexation boundaries and for generating the property ownership and public notice lists. This proposal assumes that the adopted.CEQA environmental review for the acquisition and rehabilitation of the Donner Lake water system will be sufficient for the annexation application. We will provide a draft copy of the Annexation Application including map and attachments for review by the District and LAFCo. Based on any comments received, we will make necessary revisions and provide the application in its final form to the District. i 's `s 440 Lower Grass Valley Road, Suite A, Nevada City,CA 95959 (530) 265-8021 Fax (530)265-6834 Schedule of Services We anticipate needing approximately eight weeks following the District's authorization to proceed to prepare the annexation application. This schedule assumes that the necessary information to be provided by the District will be available in a timely manner. Engineer's Fee We propose to provide the above described services for a fixed fee of$8,000. Our fee does not include application processing fees which may be charged by LAFCo. Thank you for the opportunity to provide this proposal for professional services for the annexation of the Donner Lake service area. If you have any questions, please give me a call. Your, July, -mot r,, { ✓r V: Keith Knibb PJ001/008 �l Resurgens Specialty Underwriting,Inc, -- 945 East Paces Ferry Road,Suite 1800 Atlanta,GA Telephone! (404)237 23 16a ax1 t 04)231.3755 lipt Date: March 15, 2006 Recipient: Mary Chapman Company: Truckee Donner Public Utility District Fax No.: (530)587-5056 Sender,- Lila Samuel for Peter Christel Telephone; (404)260-3901 Fax No.; (404)260-3928 Internet: Dc ristel rsui.com Sub ect John Broussai v. Truckee Donner Public Utility District You should receive 8 page(s)including this cover sheet. CWBQ9gnyA TYNOTE { The information contained in this facsimile message is legally privileged and confrdential information intended only for the use of the individual or entity named above, if the reader of the message is not the intended recipient,You are hereby notified that any dissemination distribution or c $ If you have received this telecopy in error, please immediatelyrollY of this telecopy is strictly prohibited. 'message to us at the address above via the United,Stag by telephone and return the original is a discrepancy in the number off Service- Thank { Pages received w if the reception is illegible. you Please nasty ma if there vs/ iotLovo ia:vi rnx 002J008 (� r RSUI Group, Inc. Phone (404)231-2366 v .( 945 East paces Ferry Road Suite 1800 Fax (404)231-3755 Atlanta, GA 30326-1 1 25 March 15, 2006 Via Fa 'mile 30-587- 05 and Car ' ed Mail Return Receipt R, Rested Mary Chapman Administrative Services Manager Truckee Donner Public Utility District P.0 Box 309 11570 Donner Pass Road Truckee, CA 96160 Re: Insured Truckee Donner Public Utility District(the"Insured") Claimant John Broussal Policy Nos. R2HP610732 (5/i/02-5/l/03) NHP618463 (511105-511/06) Limits of Liability S5,000 000 Issuing Companies Royal Indemnity Company(R2HP610732) RSUI Indemnity Company{NHP618463) SUI File os. 1250054354 d 7030 08 46 Dear Ms. Chapman: This letter is being directed to you as the authorized representative of the Insured for insurance coverage P111Poses. To the extent you are not acting in such capacity, we request that you forward this letter to the "roPriate representative of the Insured for his or her information and advise us accordingly. As you may know, Allegbany Insurance Holdings LLC acquired Royal Specialty Underwriting, Inc. ("RSUI") effective July 1, 2003. As part of that transaction, RSUI and Royal & SunAlliance have entered into a Claims Servicing Agreement for run-off services, pursuant to which RSUI has agreed to serve as a third-party administrator for the run-off business relating to this acquisition. 'The RSUI claims staff members have continued to handle matters as they did prior to the transaction. Royal Specialty Underwriting, Inc. has since changed its name to "RSUI Group, Inc.- On behalf of Royal & SunAlliance, Royal Indemnity Company (collectively) "Royal') and RSUI Indemnity Company("RSUI'), this letter will serve to formally acknowledge rec from your office dated January 27, 2006, together with copies of among other things, a summons and eipt of correspondence ,complaint in connection with an action captioned John rouse 11 on behatt similarly o situated v. Truckee onner Pub 'c Utili District- an Does 1- 0, Venuedhmimsl n the all Court of the State of Catiformmia Nevada County, and pending under Case No. T05/1947C. This letter will further serve to acknowledge receipt of subsequent correspondence from your office and from the s s RSUI Indemnity Company Landmark American Insurance Company A member of Allegheny Insurance Holdings LLC v» �J,4vvo 10.V I rnA i6,. 003/008 Mary Chapman Page 2 of 7 Law Office of Porter Simon, forwarding copies of additional documents and correspondence in connection with the matter. As set forth in greater detail below, after carefully reviewing this matter in conjunction with the terms and conditions of the above-referenced policies, coverage for the matter. we regret to inform you that they do not provide THE POLICIE This matter concerns directors and officers liability insurance policy numbers R2HP610732 and NHP6I8463, which were issued by Royal and RSUI, respectively. The Royal policy was issued for the Policy Period from May 1, 2002 to May 1, 2003 and provided for a $5,000,000 aggregate limit of liability per Policy Period and a $25,000 retention (the "Royal Policy,,). The RSUI policy was issued for the Policy Period from May 1, 2005 to May 1, 2006 and provides for $5,000,000 aggregate limit of liability per Policy Period (the "RSUI Policy"). The RSUI policy is subject to a$25,000 retention with respect to Insuring Agreements B and C thereunder and a $35,000 retention with respect to employment Practices claims. l3 QWB� OUND This matter concerns an action captioned Jo n B usSal on behalf of hiro is si ated v Truckee Donner public Utility D�stnct an Does i-S"—wand all o hers s ilariv erior Court of the State of California,Nevada County, and pending under Case TOS 947C. The acd in the ction is in the form of a putative class action and is one in which the plaintiff, John Broussal, seeks to: 1) halt the Insured unfair practices of illegally discriminating against properties formerly served by the Donner Lake Water Company(the '!DLWC' who had not connected to their water system before June 6, 2005 by charging diem without justification a water facilities fee not imposed on other properties in that subdivision prior to that time;2)stop the Insured from imposing water connection facility fees who seek to connect after June 6, 2005, or to show cause why such fees may be properly imposed; 3)on p ro p ert i es in the DLWC determine that no capacity charge may be imposed by the Insured on former DLWC customers or, alternatively, that an accounting be ordered; 4) determine that the water facility fee is a special tax adopted without complying with applicable law; and 5) require that the Insured credit assessments imposed on DLWC properties for the building of water facilities serving those properties against any water capacity charge legally imposed by the Insured The pleading filed in connection with the action was received by the Insured's general counsel on January 24, 2006 and by the Insured on January 26, 2006. The current action was preceded by a claim that Mr. Broussal made against the Insured by Ietter dated June 11, 2002 from S. Chandler Visher, Esq., the attorney representing lawsuit. Enclosed with Mr. Visher's letter was a draft complaint in connection with Mr. Broussal in the instant threatened class action. The letter and the draft complaint enclosed therewith demanded essentially the same relief as that sought by the current action and made many of the same allegations, although with respect to an earlier ordinance, s i� l . V3/ IJ/ZVVb I6:Vi t71A 4gQ04/008 Mary Chapman Page 3 of 7 AVERAGE As noted above, neither the Royal Policy nor the RSUI Policy affords the Insured coverage for this matter. In that regard, we direct your attention in the first instance to Section I. of the RSUI Policy (the Insuring Agreements), which provides as follows: ..,the Insurer agrees: SECTION 1. -INSURING AGREEMENTS A C. With the Insured Organization that if a Claim for a Wrongful Act is first made against the Insured Organization during the Policy Period and reported in accordance with SECTION V. — CONDITIONS, C. Notice of Claim or Circumstance of this policy, the Insurer will pay on behalf of the Insured Organization all Loss the Insured Organization is legally obligated to pay. The terms "Claim" and "Wrongful Act", referenced above, are defined at Section III. of the Policy (Defrnitions)' as follows: SECTION III. DEFINITIONS w B. Claim, either in the singular or the plural,means; I. A written demand for monetary or non-monetary relief;Z Z. A civil, criminal, administrative, regulatory or arbitration proceeding for monetary relief which is commenced by: a. Service of a complaint or similar pleading; b. Return of an indictment(in the case of a criminal proceeding); or e. Receipt of a notice of charges; 3. An administrative or regulatory investigation when conducted by the Equal Employment Opportunity Commission ("EEOC,) or similar state, local or foreign agency, which is commenced by the filing of a notice of charges, As modified by endorsement z z 7 he Royal Policy also defines Claim,in pertinent part,to include demands for monetary or non-monetary relief The 2002 letter, with accompanying draft complaint, reflects a number of demands for return of money, as well as demands for non- monetary relief and was a Claim at the latest,when received by the Insured. i �ti2� { oa/ is/zone IbA l rax 10005/008 Mary Chapman Page 4 of 7 service of a complaint or similar document of which notice has been given to the Insured. The DEFINITION of Claim shall include an Employment Practices Claim; provided, the DEFINITION of Claim shall not include any labor or grievance proceeding which is pursuant to a collective bargaining agreement. O• Wrongfol Act means, 1 With respect to the Insured Organization, any Employment Practices Wrongful Act or any actual or alleged act, error, omission, misstatement, misleading statement, neglect or breach of duty by or on behalf of the Insured Organization. Subdivision C. (Notice of Claim or Circumstance) of Section V. (Conditions) of the Policy, also referenced above,provides in pertinent part as follows: SECTION V. -CONDITIONS m C. Notice of Claim or Circumstance 1. If, during the Policy Period or Discovery Period (if applicable) any Claim is first made, it shall be a condition precedent to the Insurer's obligation to pay, that the Insured give written notice of such Claim to the Insurer(via certified mail at the address shown on the Declarations Page) as soon as practicable after such Claim is first made, but in no event shall such notice be given later than thirty (30) days after either the expiration date or any earlier cancellation date of this policy. As noted above, coverage under the RSUI Policy is triggered y among other things, Wrongful Acts that are .first made against the Insured and reported to RSUI during the applicable Policy Period,but not later than 30 days after the end of the Policy Period. defined under the RSUI Policy. The June 11, 2002 letter of S. Chandler Vi The action brought by Mr. Broussal constitutes a "Claim" for a "Wrongful Act", as those terns are sher, Esq, also constitutes a Uv11u14VVD iu.vc rnn IA 0081008 Mary Chapman Page S of 7 "Claim" for a "Wrongful Act" under the Policy. The fact that the action and the June I i, 2002 letter both constitute "Claims" for "Wrongful Acts" is significant because Section V. of the Policy (Conditions) provides in pertinent part at subdivision 8.3. thereof (Limit of Liability; Retention; Payment of Loss) that "[aIll Claims based on, arising out of, directly or indirectly resulting from in consequence of, or in any way involving the same or related facts, circumstances, situations, transactions or events, or the same or related series of facts, circumstances,situations, transactions or events, shall be deemed to be a single Claim for all purposes under this policy, shall be subject to the Retention stated in Item 4. of the Declarations page, and shall be deemed first made when the earliest of such Claims is first made,regardless of whether such date is before or during the Policy Period." The Claim made by the current action arises out of directly or indirectly results from, is in consequence of and involves the same or related facts, circumstances, situations, transactions or events, or the same or related series of facts, circumstances, situations, transactions or events, as those involved in the Cl made in the June 1), 2002 letter. Among other things, the aim two Claims involve the same affected users 'rod properties and many, if not all, of the same questions of law, including whether the water capacity charges imposed: 1) fund only costs necessary for providing water to new customers w , or whether they were established in amounts to also fund improvements necessary for existing users; and 2) are special (he ordinance that resulted i axes requiring a vote of property owners or persons affected to be effectivee bringing of the cu . In addition, it appears that that was adapted address tthe sh rtcominggs of ordman ordinance action thatresulted least in th the bringing measure Claim. grog of the earlier Steven Gross, Esq., counsel for the Insured, has argued that the Claim made by the June 11, 2002 letter involved a different ordinance than that involved in the current action and that the earlier Claim was resolved so that, but for the adoption of the subsequent ordinance, Mr. Broussal would not have any ('latms against the Insured, i.e., his claims did not arise until the subsequent ordinance was adopted. What Mr. Gross fails to appreciate, however, is that the two Claims need not be identical in order for them to be deemed a single Claim. The second Claim needs only to arise out of, directly or indirectly rosult from, be in consequence of or involve the same or related facts, ci transactions or events, or the same or related series of facts, ci rcumstances, situations, rcumstances, situations, transactions or events, as those involved in the earlier Claim. There can be no question that the two Claims made by Mr. Broussal are sufficiently interrelated so as to fall within the scope of the above-quoted language. In view of the foregoing, the Claim made by the current action and the Claim made by the June 11, 2002 letter are deemed to be a single Claim first made when the earliest of therm was made, i.e., on or about Ame 11, 2002, which was well prior to the inception of the RSUI Policy. Accordingly, the RSL1I Policy is not triggered and affords the Insured no coverage for the matter. Nor is the matter covered under the Royal Policy, which reflects similar language to that quoted above,3 because the Claim, while first made during the effective dates of coverage of the Royal Period, was The notice provisions of the i P Royal Policy state in perdarrt part that "If during the Policy period any Claim is firs[made, In a condition precedent to indemnity,certified the Insured Organization must give written notice to Royal s cial Un Inc.on behalf of the Insurer by certified mail and Y'd Pe tY derwriting, Claim as so Properly addressed to the address shown on the Declarations page,of such ' cancellation date f this policy."(See subdivision t(G}(i)first of Section 4.de and in o event tTI6NS�fthe the expiration date or any earlier r Royal y}. "/ Ii /cvvo io.vt ren 2007/008 Mary Chapman Page 6 of 7 reported well after that policy's expiration. The absence of notice to the Insurer in 2002 precludes coverage in 2006 for the same or an interrelated Claim, as interrelated is defined for purposes of this determination. ONCLUSION For the aforementioned reasons, neither the Royal Policy nor the RSUI Policy affords the Insured coverage for this matter. Accordingly, Royal and RSUI will not indemnify the Insured for any defense expenses,judgment, settlement or award rendered in connection with the matter. In light of this denial of coverage, we recommend that you place any and all other insurers that may provide coverage for this matter on notice hereof. We respectfully reserve all rights and defenses available under the Policy and at law to deny coverage on additional and alternative grounds as other terms, conditions, statements, representations or warranties in connection with the Policy and the application for the Policy are found to apply O coverage position with respect to this matter is based upon presently brown facts_ We reserve . ur the right to supplement our coverage position based upon any facts not presently in our possession. We encourage you to contact us with any questions or concerns you may have with respect to the Positions expressed in this letter. you should be aware that you are entitled to have our handling of this matter reviewed by the California Department of Insurance to the extent you disagree with any or all of the positions expressed herein. Any such request should be directed as follows: California Department of Insurance Claims Service Bureau— 1 lw Floor 300 South Spring Street Los Angeles, CA 90013 Telephone: (800) 927-4357 or(213) 897-8921 V cry truly yours, �A n Poster M. Christel Cuef Claim Specialist D&O and Professional Liability Claims (404)260-3901 (tel.) (404)260-3928 (fax) pchristei@rsui.com cc; Steven C. Gross, Esq. (Via Facsimile No. 530-587-1316) Law Office of Porter Simon 40200 Truckee Airport Road,Suite I Truckee, CA 96161 U3l tW(MC lb:V? hAX 16 008/008 Mary Chapman Page 7 of 7 Keith W. Grand Marsh Risk&Insurance Services Three Embarcadero Center San Francisco, CA 94111 W. Greg Franc Cramp E&S 160 Spear Street 16"Floor San Francisco, CA 94105