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97-0701_CVWD_Minutes_Regular Meeting001 MINUTES OF REGULAR MEETING OF THE BOARD OF DIRECTORS CAPISTRANO VALLEY WATER DISTRICT July 1, 1997 The Regular Meeting was called to order by Chairman Jones at 6:30 PM in the City Hall Council Chamber. R LL ALL Directors Present: Collene Campbell, Director John Greiner, Director Wyatt Hart, Director Gil Jones, Chairman David Swerdlin, Vice Chairman Staff Present: Ray Auerbach, General Manager Robert Clark, District Engineer Georg'Ann Scott, Clerk of the Board James R. Widner, Administrative Services Manager John Shaw, Woodruff, Spradlin and Smart ORAL C MMUNI ATI N None. ITEM5 RECEIVED TOO LATE TO BE PLACED ON AGENDA None. CONSENT CALENDAR Director Swerdlin offered the motion to approve the items on the Consent Calendar, and Director Greiner seconded the motion accepting staff recommendations. Motion carried unanimously. Director Swerdlin questioned a warrant for a submersible pump. General Manager Auerbach stated that the pump was rented for the Mission Street well where the District plans to install a new pump with an enclosure. Plans are currently under review with the various City commissions. In the interim, staff is renting a pump on a monthly basis. Although the rental cost is rather expensive, the differential between pumping groundwater and purchasing imported water makes this a better investment. 002 Capistrano Valley Water District Minutes of the Regular Meeting July 1, 1997 1. Minutes of the. Regular Meeting of June 17. 1297 The Minutes of the Regular Meeting of June 17, 1997 were approved as presented. 2. List of Warrants The List of Warrants No. 8978 through 9047 inclusive for the total amount of $470,743.02 was received and filed. 3. Monthly Financial Report for May The Monthly Financial Report for May 1997 was received and filed. 4. Approval of Extension of Agreement for Annual Audit Services with Diehl Evans and Cgmpany Motion was unanimously carried to approve the extension of the Annual Audit Services Agreement with Diehl, Evans and Company for one year with a fee of $11,200. BIDS. CONTRACTS AND AGREEMENTS 5. Nglice of Completion - #2 Strawberry Lane Slope Erosion Repair Vice Chairman Swerdlin made a motion, and Director Hart seconded, to authorize the Clerk of the Board to file a Notice of Completion for the #2 Strawberry Lane Slope Erosion Repair project with the County of Orange. Motion received unanimous approval. 6. AQQroval of Proposed r i n n Mpintenan e Agreement betw n the Cavistrpno Valley Water District and thei f San Juan Capistrano As stated by Mr. Auerbach, this item is the companion item on tonight's Council agenda. This agreement between the District and the City allows the City to take over the operation of the District and transfer all District employees over to the City. Copies of the revised O&M Agreement was distributed to the Board at the beginning of tonight's meeting and has a few changes in the insurance 2 003 Capistrano Valley Water District Minutes of the Regular Meeting July 1, 1997 requirements and indemnity sections. District Counsel Shaw acknowledged the last-minute changes related to the insurance package was due to a letter from the Joint Insurance Pool relative to the exacting and particular provisions of their master agreement with the City. The revised language reflects exactly what the insurance authority is offering in the way of insurance protections. Also, the Water District has an insurance policy in place that will not expire for another month giving the City more time to make sure that all loose ends are tied together with regard to overlapping coverage. Mr. Auerbach added that an item was provided to the Board for consideration last week from the Water Advisory Commission who met to review the 0&M Agreement after the agenda was prepared. At their meeting of June 24, the Advisory Commission recommended that the Agreement be approved, but with additional language added to Section 4. This is some basic language that was included in the original LAFCO application relating to the creation of a Water Enterprise Fund and future transfers between City funds. Mr. Auerbach recognized Mr. Dave Fergurson and Mr. John Chestek of the Water Advisory Commission, and Chairman Jones asked if they would elaborate on their item. Mr. Ferguson stated that at the June 24 meeting, the Advisory Commission unanimously agreed that they would like to see language in the agreement which parallels the language that was in the LAFCO agreement and provided for the establishment of a Water Enterprise Fund. Mr. Shaw interjected that the City has looked at this very closely, and his recommendation is not to include this language for several reasons. One would be that we're not consolidating, this is totally different as it's an operations and maintenance agreement/independent contractor relationship. He recommended that the Board/Council simply retain its discretion going into the merger and added 3 004 Capistrano Valley Water District Minutes of the Regular Meeting July 1, 1997 that the City Manager could comment further either now or at the Council meeting. Chairman Jones briefly discussed this with City Manager Scarborough yesterday and added that with all good intentions, the Board/Council will protect the enterprise fund, but it would be unfair to encumber future councils with this particular part of it. Under the circumstances, it would be better to not include this language in the agreement because of how it could affect future councils' and their decisions. Director Swerdlin recommended that staff bring this particular Item back in 60 days under the authority of the City for a list of pros and cons and a much deeper analysis than the Board has received to date. He added he was not quite willing to drop the issue, but he understood the concerns raised by the Board/Council, and it would behoove them to bring this particular issue back and he asked this be included in his motion. Chairman Jones stated, with all due respect, not to include that in the motion. The Board/Council could bring it back in 60 days or 90 days and review it again, but he thought the Board/Council should ratify this agreement as it is, and offered to make Director Swerdlin's request as a matter of record. Mr. Ferguson appreciated legal counsel's position that the architecture has changed somewhat from the original plan of consolidation, but he didn't think the intent of the language is any different than what was proposed under that architecture as a guarantee that the water enterprise fund would be held separate He stated that it was particularly important for all the rate payers in the District and may be more relevant for the rate payers living in the Dana Point service area. He asked the Board to reconsider it. Chairman Jones stated he thought it could be N 00= Capistrano Valley Water District Minutes of the Regular Meeting July 1, 1997 handled separately and that the Board/Council needed time to review and develop the appropriate solution. Director Swerdlin wanted to ensure that since the City would be handling it and he wanted to make sure that they state this properly and use the proper vehicle to the City Council. Mr. Shaw added that the best vehicle would be to hold a joint meeting of the Board/Council in 60 or 90 days. Director Hart asked for clarification as to what is being ratified, and Mr. Shaw stated it is the existing language in the draft/revised Operations and Maintenance Agreement, and in particular the language at issue being Section 4 - Reimbursement to City. The Water Advisory Commission wanted to change some of the language in Section 4 per the memo they submitted to the Board/Council. Our recommendation is to leave it as is and, per Director Swerdlin's suggestion, call for a joint meeting in 60 to 90 days with ratification as written in the draft. Chairman Jones asked if there were any other questions or comments. Director Swerdlin offered a motion to adopt the Operations and Maintenance Agreement between the Capistrano Valley Water District and the City of San Juan Capistrano. Director Greiner seconded the motion which unanimously passed. Chairman Jones wished to clarify that he understands the Water Advisory Commission's position concerning the Water Enterprise Fund. He attended a recent Commission meeting and discussed these very concerns, and he guaranteed that the Board/Council had no intentions of fooling with the fund However, the concerns expressed by legal counsel are important and the Board/Council will follow up within sixty or ninety days. 5 006 Capistrano Valley Water District Minutes of the Regular Meeting July 1, 1997 PRESENTATION 7. Presentation of Plague Commending Ray Auerbach With over 31 years of public service, Ray Auerbach will retire from the Capistrano Valley Water District on July 7, 1997. In the last 11 years under Ray's leadership, a dramatic change has taken place at the District. His expertise and meticulous care of the technical details have been invaluable not only with the District, but the San Juan Basin Authority. On behalf of the Board of Directors, Chairman Jones presented a commemoration plaque to Ray Auerbach with their sincere appreciation. ADJOURNMENT With a motion from Director Campbell and seconded by Director Greiner, Chairman Jones adjourned the meeting at 6:45 PM. Respectfully submitted, _4eorg'A#n Scott, Board Clerk Capistrano Valley Water District PAENG\AGNDIBRDNEIN.DOC M NOTICE OF CANCELLATION OF MEETING OF THE BOARD OF DIRECTORS OF THE CAPISTRANO VALLEY WATER DISTRICT NOTICE IS HEREBY GIVEN, that due to lack of items for consideration, the Capistrano Valley Water District's regularly scheduled meeting of July 15 , 1997, will not be held. The next regularly scheduled meeting will be held on Tuesday, Atlgtlst 5 ,1997, at 5:30 p.m., in the City Council Chamber, 32400 Paseo Adelanto, San Juan Capistrano. DATED: July 15, 1997 Cheryl Joh on, &ity Clerk STATE OF CALIFORNIA ) COUNTY OF ORANGE ) SS AFFIDAVIT OF POSTING CITY OF SAN JUAN CAPISTRANO ) I, CHERYL JOHNSON, City Clerk of the City of San Juan Capistrano do hereby declare that the above Notice was posted at or near the door of the City Council Chamber on July 15, 1997. I declare under penalty of perjury that the foregoing is true and correct. Cheryl Johnso , City Jerk San Juan Capistrano, California 1 007