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SOUTH TAHOE PUBLIC UTILITY DISTRICT
Richard Solbrig, General Manager Paul Sciuto, Assistant General Manager
Eric W. Schafer, President BOARD MEMBERS James R. Jones, Vice President
Chris Cefalu, Director Randy Vogelgesang, Director Kelly Sheehan, Director
REGULAR MEETING OF THE BOARD OF DIRECTORS
SOUTH TAHOE PUBLIC UTILITY DISTRICT
FEBRUARY 7, 2013
MI N UTES
The Board of Directors of the South Tahoe Public Utility District met in a regular session,
February 7, 2013, 2:00 p.m., at the District Office, located at 1275 Meadow Crest Drive,
South Lake Tahoe, California.
BOARD OF DIRECTORS: ROLL CALL
President Schafer; Directors Cefalu, Jones, Vogelgesang, Sheehan
STAFF:
Solbrig, Sharp, Sciuto, Hughes, C. Stanley, Hussmann, Ryan,
Swain, Bledsoe, Curtis, Thiel, Cullen, Cocking, Attorney Herrema
GUESTS:
Tom Davis/Mayor Pro-Tem and Lisa Watson/City of South Lake Tahoe;
Chris Westlake and Shellan Rodriguez/TPC -SLT PacificAssociates
Moved Cefalu /Second Vogel_ec� san_q / Passed Unanimously CONSENT CALENDAR
to approve the Consent Calendar as submitted:
a. Billing of Water Service Charges- Enacted Ordinance 545-13
Amending Section 6.1 .2 of the Administrative Code regarding
the billing of water service charges;
b. 2012 Water Tank Recoating Project-Authorized Amendment A
to Task Order No. 7 to Bay Area Coating Consultants (BACC) for
additional coating inspection services, in the amount not to
exceed $15,200;
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE-2
c. 2012 Water Tank Recoating Project-Approved Change Order CONSENT CALENDAR
No. 3 to Crosno Construction, Inc., in the amount of $14,120.62; (continued)
d. Wireless Network at Plant-Authorized staff to request quotations
for new Cisco or equivalent wireless network solution;
e. Wildwood Waterline Replacement Project and Bal Bijou
Waterline Project- (1) Approved Project Closeout Agreement
and Release of Claims for Thomas Haen Company, Inc., and
(2) Authorized staff to file a Notice of Completion with the
EI Dorado County Clerk.
ITEMS FOR BOARD ACTION
The Aspens at South Lake Tahoe is a proposed 48-unit low- THE ASPENS AT SOUTH LAKE
income housing project, and is proposed to be funded with
a variety of funding sources including a traditional loan, state
tax credits, state home loans, and District deferred water
capacity charges.
Developer representative, Shellan Rodriguez, came before the
Board to request the Fee Deferral Agreement the Board commit-
ted to approve in July, 2012, be formally approved now. The agree-
ment incorporates terms as discussed during previous Board
meetings, including being first in line to receive a $10,000 annual
primary payment from residual receipts.
The estimated District Capacity Charges associated with this
project are $580,000 for sewer and $550,000 for water. The
completed project is estimated to generate approximately
$25,000 annually in water and sewer service charges. The
Developer would pay all sewer capacity charges upfront and
water capacity charges would be deferred under the following
terms:
1 . Repayment terms -55 years @3%.
2. Loan payments made from residual receipts (gross revenue
less operating expenses).
3. Annual payment of $10,000 first in line to receive residual receipts.
4. Annual pro-rata share of any other residual receipts available.
The benefits include receipt of sewer capacity charges and the
ongoing water and sewer service charges, and the addition of
new low income housing is good for the community.
Rodriguez explained every funding source has its own set of
requirements, and she requested on behalf of the State, that the
loan be made with no residual receipts payments requirement
(Items 3. and 4. would be deleted), and that the water capacity
charges be waived entirely. The Board expressed their desire
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE-3
to maintain commitments made to date, and was not in favor THE ASPENS AT SOUTH LAKE
of eliminating the $10,000 residual receipts payment, or waiving (continued)
the entire water capacity service charge as it would not be
prudent for the District's existing ratepayers to do so. She will
look into the possibility of moving the $10,000 residual receipts
payment to another fund designated for hard cost utilities
(operating expenses). If it can be done, the agreement will be
amended accordingly.
A lengthy discussion was held about project payback and risks if
it were to fail.
President Schafer reported a letter was received from former
City Manager, David Jenkins, in favor of the project.
Moved Vogel_ec� san_q /Second Cefalu / Jones Voted No /
Passed to: (1) Authorize District staff to develop final language
to incorporate the change concerning moving payment above
the line; and (2) Authorize Board President to execute the fee
deferral agreement with SLT Pacific Associates, a California
Limited Partnership.
Director Jones voted no since he objected to subsidizing this
project at risk to District ratepayers, and because of the pre-
cedent it could set.
The District allows new water service connections pursuant to ALLOCATION OF
applicable rules and regulations, which provide that all water RESPONSIBILITY FOR
metering devices are the property of the District, and may be MAINTENANCE OF WATER
installed by a property owner or their contractor. The District is METERS
allocated the responsibility for the maintenance, repair and re-
placement of water meters, risers, boxes smaller than two inches,
and the meter and meter pit is supplied to the customer by the
District. When a customer requires a meter of two inches or great-
er in size, the customer supplies the meter, through its purchase
from a District-approved supplier. The District does not test or
inspect meters that it does not supply prior to their installation.
Due to staff having to repair improperly installed meters less than
two inches, a code amendment was recommended to designate
responsibility to the customer for costs of repairs on small meters.
Additionally, the pit and meter is given to the property owner once
their plans are stamped. This sometimes allows the District property
(meter and meter pit) to remain with the customer for a significant
amount of time. Staff recommended restricting installation of the
meter and meter pit to District staff.
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE-4
It was the consensus of the Board to direct staff to prepare a ALLOCATION OF
modification to the Ordinance for the Board's approval that RESPONSIBILITY FOR
standardizes all meter installations and to assume responsibility MAINTENANCE OF WATER
for connections and meters less than two inches in size. METERS
(continued)
No Board action.
Staff recommend the Ordinance currently in place be modified ORDINANCE NO. 544-13:
to remove the description of what a vacant property is. It cur- WATER SERVICE CHARGES
rently states that to be considered a vacant property it must FOR VACANT PROPERTIES
no structures on the parcel, or have any active building permits
in place. Staff reported if an owner of a vacant lot submits plans
for a new structure, water service charges will resume upon the
District's approval of the plans. The owner will not be required to
pay a connection fee if the lot remained connected to the
District's main during the period that it was considered to be a
vacant lot. Staff annually inspects vacant lot properties to confirm
that the parcel still meets the criteria of the vacant lot ordinance.
Moved Cefalu /Second Jones / Passed Unanimously to enact
Ordinance No. 544-13, amending Section 3.1 .55 of the Adminis-
trative Code regarding the suspension of water service charges
for vacant properties and superseding Ordinance No. 524-10 in
its entirety.
The current Ordinance provides that the District will be paid ORDINANCE NO. 546-13:
a fee of $50 for issuing a permit to connect and inspect a SEWER CONNECTION
sewer lateral. It also provides that a fee of $50 be collected PERMIT AND INSPECTION
for issuing a permit to install and inspect a wye saddle. Staff FEES
recommended consolidating the two fees into a single fee,
which covers permits for both lateral connection and wye
saddle installation and the associated inspections, and is intend-
ed to recover the total costs associated with all such inspections,
and which will streamline the permitting and inspection process
for both the customer and the District. Based on an analysis of
the time associated with inspections for each, staff recommended
that the fee be set at $150 as an accurate reflection of the
District's actual time and costs.
Moved Vogel_ec� san_q /Second Jones / Passed Unanimously to
enact Ordinance No. 546-13 amending Sections 4.5.2, 4.5.9,
and 4.5.10 of the Administrative Code regarding fees for issuing
a permit to connect and inspect a sewer lateral and issuing a
permit to install and inspect a wye saddle.
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE-5
The Board has postponed scheduled increases to the water SCHEDULED CAPACITY
and sewer capacity charges five time for five separate six- CHARGE INCREASES AND
month terms. Capacity charges were scheduled to increase TWO-YEAR MONITORING
effective January 1, 2013. The increase to water would be the PERIOD FOR COMMERCIAL
fifth and final increase developed in the 2006 Water Capacity CONNECTIONS
Charge Study. The increase to sewer would be the fourth of
six step increases developed in the 2008 Sewer Capacity
Charge Study. Capacity charge revenue is restricted for
infrastructure related projects/debts. When the charge levels
are kept artificially low, the current ratepayers are subsidizing
the difference with the District completes capital projects.
In regards to the two-year monitoring period currently required
for commercial applications to use to estimate usage for the
average day during the peak month of the year- that policy
has been in place for at least 15 years and it should have been
amended in 2006 when the Water Capacity Charge Study was
complete. Staff recommended the section describing the special
policy for commercial calculations be eliminated from the
Administrative Code, and commercial connections be calculated
the same as residential capacity charges are- based on proper
meter size. This change will provide the customer the certainty of
a consistent charge per connection size rather than receiving a
capacity charge bill in the future to cover usage in excess of the
original estimates. It was the consensus of the Board to direct staff
to develop an amendment to eliminate the special policy for
commercial calculations.
The Board discussed the proposed capacity charge increases
and it was the consensus of a majority of the Board that the
capacity charges that are already being charged are significant,
and that raising them in the current economic conditions could
deter building, and therefore should not be raised.
No Board action.
Moved Sheehan /Second Cefalu/ Passed Unanimously to PAYMENT OF CLAIMS
approve payment in the amount of $1,821,251 .62.
Water and Wastewater Operations Committee: The committee STANDING COMMITTEE
met February 4. Minutes of the meeting are available upon REPORTS
request. The main topics of discussion included the odor
complaint at Fallen Leaf Lake, and pricing options for Lukins
to consider for water service to TJ Maxx.
Director Jones reported the District's new Headworks project BOARD MEMBER REPORT
was featured in the industry publication "Water & Wastes Digest."
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE-6
Director Jones reported he will serve on a governance advisory EL DORADO COUNTY
committee to develop standards for directors of the Mountain WATER AGENCY REPORT
Counties Water Resources Association, and also to review their
incorporation documents.
Director Schafer reported he will send a report soon that will BOARD MEMBER REPORT
cover the CASA (California Association of Sanitation Agencies)
conference and associated costs. He urged the Board to submit
their travel and training requests for the 2013/14 budget process.
He also urged Board members to take an interest in attending
conferences and training as a way to stay current with water
and sewer issues, especially since the District is in a somewhat
isolated community.
Richard Solbria reported: Outreach presentations will be made GENERAL MANAGER
to the EI Dorado County Board of Supervisors and the TRPA REPORTS
Governing Board; two responses to the RFP for the Retirement
Health Savings Plan consultant were received and will be
reviewed; and on February 12 the Lake Tahoe Unified School
District will consider moving their boundary areas and election
process to comply with the California Voters Right Act.
Assistant General Manaqer/ En__iq neer: Paul Sciuto reported one STAFF REPORTS
of the District's contract ranches, Bentley Agrowdynamics, was
sold to the Dressler family.
Leqal Counsel: Brad Herrema reported the petition to change
water rights at Diamond Valley Ranch was approved.
Manaqer of Customer Service: Tim Bledsoe reported on the
status of the delinquent accounts: collections are underway
and payment plans are being developed. A part-time person
will be hired soon to continue the efforts.
District Information Officer: Dennis Cocking reported on the
status of the District's Helping Hands program.
3:50 P.�vi. -4:00 P.�vi. MEETING BREAK AND
ADJOURNMENT TO
CLOSED SESSION
5:30 P.�vi. RECONVENED TO OPEN
SESSION
REGULAR BOARD MEETING MINUTES- FEBRUARY 7,2013 PAGE- 7
ACTION / REPORT ON ITEM DISCUSSED DURING CLOSED SESSION
a. Pursuant to Government Code Section 54956.9(b)/Conference with Legal Counsel re:
existing litigation re: EI Dorado County Superior Court Case SC20120227 GRCLT
Condominium vs. South Lake Tahoe Public Utility District (filed 10/22/12)
No reportable Board action.
b. Pursuant to Section 54956.9(a) of the California Government code, Closed Session was
held for conference with legal counsel regarding existing litigation: False Claims Act
Case: United States, the States of California, Delaware, Florida, Nevada, and Tennessee
and the Commonwealths of Massachusetts and Virginia ex rel. John Hendrix v. J-M
Manufacturing Company, Inc. and Formosa Plastics Corporation, U.S.A., Civil Action No.
ED CVO6-0055-GW, United States District Court for the Central District of California.
No reportable Board action.
c. Pursuant to Section 54956.9(a) of the California Government Code, Closed Session was
held for conference with legal counsel regarding existing litigation: Los Angeles County
Superior Court, Case No. BC459943, State of Nevada, et al. v. J-M Manufacturing, et al.
No reportable Board action.
d. Pursuant to Government Code Section 54957/Public Employee Evaluation
Unrepresented Employee Position: General Manager
No reportable Board action.
5:30 P.�vi. ADJOURNMENT
Eric W. Schafer, Board President
South Tahoe Public Utility District
ATTEST:
Kathy Sharp, Clerk of the Board
South Tahoe Public Utility District