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HomeMy WebLinkAboutMinutes - EVWD Board of Directors - 01/21/2015 Approved February 11, 2015 EAST VALLEY WATER DISTRICT January 21, 2015 SPECIAL BOARD MEETING MINUTES The Chairman of the Board called the meeting to order at 5:30 p.m. and led the flag salute. PRESENT: Directors: Carrillo, Coats, Coleman, Morales, Shelton ABSENT: Directors: None STAFF: John Mura, General Manager/CEO; Brian Tompkins, Chief Financial Officer; Tom Holliman, Engineering and Operations Manager; Justine Hendricksen, District Clerk; Eileen Bateman, Senior Administrative Assistant LEGAL COUNSEL: Jean Cihigoyenetche GUEST(s): Members of the public PUBLIC COMMENTS Chairman Morales declared the public participation section of the meeting open at 5:31 p.m. There being no written or verbal comments, the public participation section was closed. BUDGET BASED RATE REVIEW AND UPDATE Chairman Morales requested that questions and comments be held until the end of the presentation. The General Manager/CEO stated that this information has undergone a thorough review process for the past seven months by members of the District and community members who are involved in the Rate Study Committee; that he encourages comments and looks forward to hearing them. He informed everyone that this will be a very long and detailed presentation and will include breaks throughout the evening. He proceeded with the presentation which included: District services at a glance, strategic planning and implementation, 2014 drought update, 2010 conservation requirements, State response to the current drought, providing reliable water service, rate study information, and the District's capital improvement program. Legal Counsel provided an overview of the requirements and voting process for Proposition 218. Minutes: 01/21/15 etb Mr. Habib Isaac from Raftelis Financial Consultants, Inc. reviewed the financial plan development; he discussed the current water financials, current projected revenue requirements, reserves and capital improvements, and the District's current financial position. Mr. Isaac provided financial plan scenarios including a pay as you go option and acquiring debt option. He reviewed the water rate structure and evolution, the necessary items to be considered when reviewing rates, comparing water rate structures and provided a list of agencies that are evaluating budget based rates in California. The Board took a break at 6:15 pm. The Board returned to open session at 6:26 pm. Mr. Habib Isaac from Raftelis Financial Consultants, Inc. continued with the presentation and provided an overview of the rate design structure, including the components of the current rate structure, proposed fixed and variable adjustments and costs associated with the rates. He also discussed the proposed budget-based tiers and the water allotment for indoor and outdoor use. The General Manager/CEO provided information regarding the District's indoor and outdoor conservation rebate program; he stated that the District is looking to provide more comprehensive efficiency rebate programs and get actively involved with customers and assist in achieving the Tier 2 rates for customers. He also reviewed the next steps for the proposed budget-based rates which include the following: community workshops, authorization of a public hearing, notices sent to all property owners, shadow bills sent to customers, proposed rates in effect. He encouraged everyone to be a part of the process and expressed his appreciation for all who took the time to be at this meeting. The General Manager/CEO addressed anticipated questions regarding the Districts' efforts to control District costs. Chairman Morales opened the meeting for comments and questions. There were questions from the public regarding fire service meters, effects on customers' bills with conservation efforts in place, future rate changes and different rates for residential and commercial customers. The General Manager and Chairman addressed and answered the public's questions and invited all to attend future board meetings and be engaged in the development of the proposed budget-based rates. The Chairman expressed his gratitude for all in attendance and comments; he stated that this public hearing process is for the benefit of all and have embraced the strategic planning of the District in keeping best management practices and staying incompliance of mandated laws. Director Carrillo thanked Mr. Isaac for the presentation; that it provided excellent information regarding the costs associated with the delivery and infrastructure of water; and that he values the focus of the presentation. He inquired about the background information of determining the tiered rates, state mandates and changes to customers dynamics in landscape structure. 2 Minutes: 01/21/15 etb Director Shelton stated that she was impressed by the effort that was completed by the Board and staff; that she hopes the public will continue to attend meetings and looks forward to the improvements. She stated that she is proud to be a member of East Valley Water District's Board of Directors. Director Coleman thanked Mr. Isaac for the presentation. He stated that with the new proposed rate structure, some customers will see an increase and others will see a decrease based on the amount of water that is being used. He inquired if the allotment of water for each household is per month or is there a roll-over provision of the unused amount and if landlords are informed of the efficiency of their rental properties. Vice Chairman Coats stated that all of the Board members are rate payers and that no one wants to pay more for their water, however, in order to keep water available, the District needs to plan ahead for all that needs to be done and that he is happy to be a part of this Board. Chairman Morales reviewed the feedback received from the ratepayers and inquired about the "roll-out" of electronic meters. He commented on the District's credit rating position and compliance of State mandates which include the benefits of receiving low interest loans to cover the costs of projects; that the pay as you go scenario makes sense in order to have the advantage of paying with cash, re-routes water usage in the event of disaster. He stated that although the proposed tiered rates sound complicated, it is customized to each individuals usage, the concept of the tiers are as follows: Tier 1 uses 100% of local ground water; Tier 2 imports other sources of purchased water to offset the use of the ground water; and Tier 3 charges are to be reinvested to help customers who want to conserve and help lower their bill. He thanked everyone for taking the time to be at this meeting. GENERAL MANAGER/CEO REPORTS The General Manager/CEO stated that this was a team effort and thanked all that are involved with this project over the past seven months including Raftelis Financial Consultants, Mr. Tompkins and Finance staff, Ms. Kelly Malloy and Public Affairs Department, Customer Service Department, and the Administration Department. LEGAL COUNSEL REPORT No report at this time. BOARD OF DIRECTORS COMMENTS Director Carrillo thanked the rate study committee and all involved for their efforts in reviewing the background of this proposed tiered rate structure. Director Coleman stated that he was glad that this information was reviewed and was grateful for the opportunity to hear public comments. He thanked all for coming to the meeting. 3 Minutes: 01/21/15 etb Director Shelton expressed her gratitude to all that were present at this meeting and to the presenters for the information provided. She appreciated all the work that went into this presentation and encourages everyone to continue to be involved in the Board meetings. Vice Chairman Coats thanked the public for attending the meeting and stated that the District needs and values the input from the public. He stated that tiered rates are not new to utility billing and are necessary to keep up with the needs of our customers. Chairman Morales expressed his appreciation to everyone who attended the meeting and acknowledged that Susan Longville was in the audience and thanked the San Bernardino Valley Municipal Water District for voting on future projects for the District. ADJOURN The meeting adjourned at 8:31 pm. ryes Morales, Jr., Chairman John J. Mura, S cretary 4 Minutes: 01/21/15 etb