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09-06-18=er 1956 WAS SOUTH TAHOE PUBLIC UTILITY DISTRICT Richard Solbrig, General Manager Shannon Cotulla, Assistant General Manager Randy Vogelgesang, President BOARD MEMBERS Kelly Sheehan, Vice President Chris Cefalu, Director James R. Jones, Director Duane Wallace, Director REGULAR MEETING OF THE BOARD OF DIRECTORS SOUTH TAHOE PUBLIC UTILITY DISTRICT September 6, 2018 MINUTES The South Tahoe Public Utility District Board of Directors met in a regular session, 2:07 p.m., at the District Office, located at 1275 Meadow Crest Drive, South Lake Tahoe, California. ROLL CALL: Board of Directors: President Vogelgesang, Directors Cefalu, Jones, Sheehan, Wallace Staff: Paul Hughes, Richard Solbrig, Shannon Cotulla, Gary Kvistad, Melonie Guttry, Chris Stanley, Jeremy Rutherdale, Bren Hoyle, Marla Sharp, Shelly Thomsen, Jessica Henderson, Heidi Baugh, Star Glaze, Linda Brown, Brent Goligoski, Cliff Bartlett, Julie Ryan, Steve Caswell, Debbie Henderson, Tim Bledsoe, John Thiel Guests: Jude Wood, Boys & Girls Club/Progress for Tahoe; Paula Peterson, South Tahoe Now; Heidi Hill Drum, Tahoe Prosperity Center; Eric Schafer, John Adamski, Paul Schultz, Lou Pierini, Deb Howard, President of the South Tahoe Association of Realtors COMMENTS FROM THE AUDIENCE: John Adamski, requested the Board consider designating Vacation Home Rental properties as commercial lodging residences. They are issued business licenses and pay transient occupancy taxes. He suggested this change could be considered when the new rate study is conducted. Paul Hughes responded that the rate consultant can be included in this discussion, but that there is no difference in rate structure for residential versus commercial water, but the rate base does change based on the size of the line/meter. CORRECTIONS TO THE AGENDA OR CONSENT CALENDAR: None CONSENT CALENDAR - Moved Wallace Second Sheehan/Vogelgesang Yes Cefalu Yes Jones Yes Sheehan Yes Wallace Yes to approve the Consent Calendar as presented. REGULAR BOARD MEETING MINUTES - September 6, 2018 PAGE - 2 a. CAPITAL OUTLAY ACCOUNTS ROLLOVER (Shannon Cotulla, Assistant General Manager and Debbie Henderson, Accounting Manager) Authorized staff to direct rollover funds budgeted in 2017/2018 Fiscal Year to the 2018/2019 Fiscal Year. b. MAINTENANCE CONNECTION PROFESSIONAL. SERVICES (Brent Goligoski, Asset Management Analyst and Chris Skelly, Information Technology Manager) Approved Professional Services Agreement to integrate the Tyler New World ERP Software with Maintenance Connection for $34,800. C. LEGAL COUNSEL FOR PUBLIC CONTRACTS (John Thiel, Engineering Department Manager) Approved Task Order No. 8 to Best, Best & Krieger LLP, Attorneys at Law, to provide as -needed legal services relating to Public Contracts in an amount not to exceed $20,000. d. CLOSED CIRCUIT TELEVISION CODING PROESSIONAL SERVICES (Brent Goligoski, Asset Management Analyst) Approved proposal from Sewer Knowledge, LLC, for professional services in an amount not to exceed $30,000 for condition assessment scoring of gravity sewer mains. e. REGULAR BOARD MEETING MINUTES: August 2 2018 and -August 16 2018 (Melonie Guttry, Executive Services Manager/Clerk of the Board) Approved August 2, 2018, and August 16, 2018, Minutes ITEMS FOR BOARD ACTION a. Transfer of Sewer Capacity for Affordable Housing Projects (Paul Hughes, Chief Financial Officer and Tim Bledsoe, Customer Service Manager) — Paul Hughes presented information regarding the draft Ordinance including several positive comments received to date. To be sure to incorporate as many of the comments as possible, this Ordinance will be considered for approval by the Board at the September 20, 2018, Board Meeting. Director Cefalu reported the ad-hoc committee met this afternoon and recommend incorporating the suggestions received. Director Wallace thanked the committee and staff for their help regarding this community issue, hoping other local agencies will follow the District's lead. Jude Wood Director of The Boys & Girls Club, thanked the Board for the Ordinance, stating there are a high number of homeless families in our community and enabling affordable housing through this Ordinance is an important and positive step forward. Heidi Hill Drum, Chief Executive Officer for the Tahoe Prosperity Center, thanked the Board for their leadership on this project. Only 21 % of local residents can afford the median price of a home in our community and the goal is to transform Tahoe for all who want to live, work and play in this community. She further expressed her appreciation for allowing the comments from various individuals and organizations. Doug Williams, President of the South Lake Tahoe Lodging Association, congratulated the Board on taking the first step on this positive change. REGULAR BOARD MEETING MINUTES -September 6, 2018 PAGE - 3 Deb Howard, President of the South Tahoe Association of Realtors, shared the local realtors' deep gratitude for moving this project forward. Director Wallace acknowledged Tim Bledsoe for his efforts on behalf of the District. b. 2018 Marlette Waterline Replacement Project (Julie Ryan, Principal Engineer) - Julie Ryan provided details regarding the Reimbursement Agreement with the City of South Lake Tahoe to provide storm drain improvements. Moved Cefalu Second Sheehan Vo e! esan Yes Cefalu Yes Jones Yes Sheehan Yes Wallace Yes to authorize staff to enter into a Reimbursement Agreement with the City of South Lake Tahoe to provide storm drain improvements. c. 2019 CASE Wheel Loader Purchase (Cliff Bartlett, Vehicle/Heavy Maintenance Mechanic Supervisor) - Cliff Bartlett provided details regarding the equipment proposal and the standardization renewal of sole brands. Linda Brown provided information regarding the recent changes in purchasing programs. Moved Sheehan Second Cefalu Vo el esan Yes Cefalu Yes Jones Yes Sheehan Yes/Walla e Yes to 1) Approve a five year standardization renewal of sole brands of CAT and CASE for the District's medium and heavy equipment; and, 2) Approve the purchase of one 2018 CASE Wheel Loader, Model 721, with a detachable snow plow blade through Sourcewell procurement services Bid #032515 -CNH to CASE Equipment in the amount of $212,670 plus tax. d. Temporary Winter Waste Water Treatment Plant Generator Rental (Stephen Caswell, Senior Engineer) - This item was removed from the Agenda and will be brought forward at a later date. e. Approve Payment of Claims (Debbie Henderson, Accounting Manager) Moved Sheeran Cefalu Second Vo el esan Yes Cefalu Yes Jones Yes Sheehan Yes Wallace Yes to approve Payment of Claims in the amount of $3,910,990.66 STANDING AND AD-HOC COMMITTEE REPORTS: Richard Solbrig reported he has been attending the Workforce Housing Committee Meetings. President Vogeigglang reported the next Ad -Hoc City Council Meeting is Thursday, September 20, 2018, 9:30 a.m. at the City Offices. BOARD MEMBER REPORTS: Director Jones reported the Alpine County dedication was nicely organized and well attended. A representative from Diane Feinstein's Office was in attendance and is interested in doing cogeneration projects, which fits nicely with the Alpine County project. EL DORADO COUNTY WATER AGENCY PURVEYOR REPORT: The next meeting is scheduled for Wednesday, September 12, 2018. GENERAL MANAGER REPORT: Richard Solbria reported on several items: REGULAR BOARD MEETING MINUTES - September 6, 2018 PAGE - 4 The District, Lukins Brothers and Tahoe Keys staff, met with Lahontan staff to discuss the parallel activities that need to take place regarding the PCE contamination. The group is requesting Lahontan's help to get state funding for cleanup efforts so that the contamination does not continue to grow. There will be a meeting on September 13, 2018, at 8:30 a.m. located at Lahontan. There is a follow-up meeting with Lahontan staff scheduled on September 19. Shannon Cotulla added he recently met with Congressman McClintock's Office, who is willing to send a representative for this meeting and Bigelow's Office will do the same. Staff is spending time searching for responsive records for the voluminous asbestos public records request. STAFFJATTORNEY REPORTS: Tim 'Bledsoe reported the total amount turned over to the EI Dorado County Tax Collector was $369,000. He proposed reviewing different types of billing processes in order to keep customers from getting behind on their utility bill. Jeremy Rutherdale provided photos regarding the Fountain Shop roof repairs and detailed the progress. ADJOURNMENT TO CLOSED SESSION: 3:32 p.m. RECONVENED TO OPEN SESSION: 3:52p.m. ACTION REPORT ON ITEMS DISCUSSED DURING CLOSED SESSION a. Pursuant to Section 54956.9(a) of the California Government Code, Closed Session may be 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 b. Pursuant to Section 54956.9(a) of the California Government Code, Closed Session may be 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 CV06-0055-GW, United States District Court for the Central District of California. No reportable Board action ITEMS FOR BOARD ACTION a. Resolution No. 3093-18 Establishing a Reserve Fund for Repair or Replacement of PVC Pipe Manufactured by J -M Manufacturing Company, Inc. (Richard Solbrig, General Manager) Moved Sheehan Second Cefalu Vo el esan Yes Cefaiu Yes Jones Yes Sheehan Yes Wallace Yes to approve Resolution No. 3093-18, establishing a reserve fund for the repair or replacement of PVC pipe manufactured by J -M Manufacturing Company, Inc. REGULAR BOARD MEETING MINUTES - September 6, 2018 PAGE - 5 President Vogelgesang reported regarding existing litigation in EI Dorado County Superior Court Case SC20180063, Preston Development vs. Pick 6 Tahoe, LLC et al. Three of the five Board Members must recuse themselves as they have a conflict. President Vogelgesang reported he has a conflict as he was the structural engineer and his clients are the owners of the building Mike McKeen and John Cefalu. Director Cefalu reported he has a conflict as his father is the partner with Mike McKeen in the building and rents to Pick 6. Director Sheehan reported she has a conflict as her son-in-law is Dan'I Preston, owner of Preston Development, who constructed the building for Mike McKeen and John Cefalu and also did the tenant improvements and her husband did work on the project. Attorney Kyistad reported that it is proper for President Vogelgesang, Director Cefalu and Director Sheehan to recuse themselves from participating in discussions on this litigation. This means those three Board Members are disqualified for the purposes of a quorum, but this situation creates a dilemma. The Government Code rule of necessity indicates that if a quorum is needed in order to take action on behalf of the Board, which isn't the result of someone being absent, and in this case three of Board Members have recused themselves, there is a procedure to allow one disqualified Board Member back into the discussion. This is done by a random process, and in this case, each Board Member will randomly draw a ticket. The Board Member who draws the odd ticket, will participate in discussions for this litigation. The random draw was conducted and President Vogelgesang drew the odd ticket. Directors Cefalu and Sheehan recused themselves and President Vogelgesang remained for Closed Session. ADJOURNMENT TO CLOSED SESSION: 4:00 pm RECONVENED TO OPEN SESSION: 4:07 p.m. CLOSED SESSION a. Pursuant to Section 54956.9(a) of the California Government code, Closed Session may be held for conference with legal counsel regarding existing litigation: EI Dorado County Superior Court Case SC20180063, Preston Development vs. Pick 6 Tahoe, LLC et al. The Board authorized Brownstein, Hyatt Farber, Schreck to represent the District in EI Dorado County Superior Court Case SC20180063. ADJOURNMENT: 4:08 p.m. AMelo*ieMtt�ry, Clerk of th oard South Tahoe Public Utility District 'bandy Vogelgesang, Board President South Tahoe Public Utility District