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HomeMy WebLinkAboutAgenda Packet - EVWD Board of Directors - 06/28/20051 East Valley Water District 3654 HIGHLAND AVE., SUITE #12, HIGHLAND, CA REGULAR BOARD MEETING June 28, 2005 2:00 P.M. AGENDA ------------------------------------------------------------------------- "In order to comply with legal requirements for posting of agenda, only those items filed with the District Secretary by 10:00 a.m. on Wednesday prior to the following Tuesday meeting not requiring departmental investigation, will be considered by the Board of Directors". CALL TO ORDER PLEDGE OF ALLEGIANCE 1. Approval of Agenda 2. Public Comments CONSENT CALENDAR 3. Approval of Board Meeting Minutes for June 14, 2005. 4. -Resolution 2005.12 — A Resolution of the Board of Directors of the East Valley Water District Accepting Dedication of Water Distribution System within Tract 16607 in the City of Highland 5. Resolution 2005.13 — A Resolution of the Board of Directors of the East Valley Water District Accepting Dedication of Sewers within Tract 16607 in the City of Highland 6. Resolution 2005.14 — A Resolution of the Board of Directors of the East Valley Water District Authorizing General Manager to Record Certificates of Lien for Unpaid Charges Approval of Development Agreement between East Valley Water District and Marquez Investments to subdivide and develop certain real property which will consist of two (2) dwelling units located at the west end of 20a' Street, west of Orange Street, in the City of Highland. The District to provide domestic sewer service to the property, which is within the Boundaries of the District Approval of Liens for Delinquent Water and Sewer Accounts. 9. Accounts Payable Disbursements: Accounts Payable Checks 202071 through 202244 were distributed June 9, 2005 through June 22, 2005 in the amount of $609,695.37. Payroll Checks for period ended June 10, 2005 and May 31, 2005 and included checks and direct deposits, in the amount of $126,180.86 and $6,670.40. Total Disbursements for the period were $742,546.63. OLD BUSINESS =, 10. Radon Rule/Perchlorate Rule Update (General Manager) 11. Headquarters Project Review and Update (General Manager) 12. Discussion and Possible action regarding LAFCO 2919 — Service Review and Sphere of Influence Update for the San Bernardino Valley Water Conservation District 13. Discussion and Possible action regarding the District's Workers' Compensation Renewal Package 14. Review and Accept Financial Statements for Period Ended May 31, 2005 15. Discussion and Possible action regarding consulting contract for the District's Insurance Renewal Management Project with Croydon Risk Consultants REPORTS 16. General Manager's Report 17. Oral Comments from Board of Directors CLOSED SESSION 18. CONFERENCE WITH REAL PROPERTY NEGOTIATOR [Government Code Section 54956.8] Property: Parry with whom District will negotiate: Party who will be negotiating on behalf of the District: Under Negotiation: 19. CONFERENCE WITH REAL PROPERTY NEGOTIATOR [Government Code Section 54956.8] Property: Party with whom District will negotiate: Party who will be negotiating on behalf of the District: Under Negotiation: 2 27 +/- Acres of Vacant Land, South of Highland Ave, West of Central Ave San Bernardino County, California APN: 1191-251-01,03,04 State of California Robert Martin/Jim Cimino Price and Terms of Payment 4.3 Acres of Vacant Land Located North of 5s' Street, East of the 30 Freeway Highland, CA APN: 1201-341-07 Mission Development Robert Martin/Jim Cimino Price and Terms of Payment SUBJECT TO APPROVAL EAST VALLEY WATER DISTRICT JUNE 149 2005 REGULAR BOARD MEETING MINUTES The meeting was called to order at 2:00 p.m. by President Wilson. Paul Dolter led the flag salute. PRESENT: Directors Lightfoot, Goodin, Sturgeon, Wilson ABSENT: Director Negrete STAFF: Robert Martin, General Manager; Paul Dolter, District Engineer; Brian Tompkins, Chief Financial Officer; Justine Hendricksen, Administrative Assistant LEGAL COUNSEL: Steve Kennedy GUEST(s): Jo McAndrews, Charles Roberts (Highland'Community News), Jim Cimino (Cimino Realty) APPROVAL OF AGENDA M/S/C (Sturgeon -Lightfoot) that the June 14, 2005 Agenda be approved as submitted. PUBLIC PARTICIPATION President Wilson declared the public participation section of the meeting open at 2:01 p.m. There being no written or verbal comments, the public participation section was closed. APPROVAL OF BOARD MEETING MINUTES FOR MAY 24, 2005 M/S/C (Sturgeon -Lightfoot) that the May 24, 2005 Board Meeting Minutes be approved as submitted. Minutes: 06/14/05 APPROVAL OF SPECIAL BOARD MEETING MINUTES (BUDGET WORKSHOP) FOR MAY 31, 2005 M/S/C (Sturgeon -Lightfoot) that the May 31, 2005 Special Board Meeting Minutes (Budget Workshop) be approved as submitted. APPROVAL OF LIENS FOR DELINQUENT WATER AND SEWER ACCOUNTS The General Manager stated that the charges identified by Account Number(s) 0730011- 00, 0910771-02, 1053286-00, 1220392-07 had been paid and should be removed from the lien list. M/S/C (Sturgeon -Lightfoot) that the liens for delinquent water and sewer accounts be approved for processing with the exceptions as noted by the General Manager. DISBURSEMENTS M/S/C (Sturgeon -Lightfoot) that General Fund Disbursements #201807 through #202070 distributed during the period of May 19, 2005 through June 8, 2005 in the amount of $1,327,274.59 and Payroll Fund Disbursements for the period ended May 27, 2005 in the amount of $118,971.06 totaling $1,446,245.65 be approved. DISCUSSION AND POSSIBLE ACTION REGARDING BID EVALUATION AND AWARD FOR THE STERLING AVENUE PIPELINE BORE AND JACK 1 PROJECT The General Manager updated the Board on the Sterling Avenue Pipeline Project; that CDM had prepared an evaluation on the bids submitted; that CDM recommends the project be awarded to Ayala Boring Inc., that the General Manager concurs with CDM's recommendations. M/S/C (Sturgeon -Goodin) that the Sterling Avenue Pipeline Bore and Jack Project be awarded to Ayala Boring Inc., in the amount of $508,550.00. RADON RULEIPERCHLORATE RULE UPDATE The General Manager stated there was nothing new to report on the Radon Rule or Perchlorate Rule. Information only. DISTRICT HEADQUARTERS REVIEW AND SITE UPDATE The General Manager updated the Board on the District's Headquarters Project; that the District is dealing with a few Civil Engineering Design Issues; that plans should be submitted soon. Information only. 2 Minutes: 06/14/05 DISCUSSION AND POSSIBLE ACTION REGARDING A PROPOSAL FROM T - MOBILE TO LEASE SPACE FOR A PCS WIRELESS TELE -COMMUNICATION FACILITY (CELL SITE) LOCATED IN THE PARKING LOT ACROSS THE STREET FROM THE FIELD OPERATIONS LOCATED AT 1155 DEL ROSA AVENUE, was presented to the Board. The General Manager updated the Board on the proposal from T -Mobile. Director Lightfoot requested information on what area of the property T -Mobile is interested in leasing, and suggested the District continue negotiations with T -Mobile. Director Sturgeon suggested we continue negotiations and inquire if T -Mobile would be interested in purchasing the property rather than leasing the property. Director Goodin would like more information regarding the proposal from T -Mobile, and is open to continuing negotiations with T -Mobile. The General Manager will follow up on the proposal from T -Mobile. No action taken. DISCUSSION AND POSSIBLE ACTION REGARDING THE DISTRICT'S PARTICIPATION IN THE CITY OF HIGHLAND'S "INDEPENDENCE DAY PARADE" ON JULY 49 2005 The Board discussed the District's participation in the City of Highland's "Independence Day Parade" on July 4, 2005. No action taken. DISCUSSION AND POSSIBLE ACTION REGARDING LAFCO 2919 — SERVICE REVIEW AND SPHERE OF INFLUENCE UPDATE FOR THE SAN BERNARDINO VALLEY WATER CONSERVATION DISTRICT The General Manager updated the Board on the LAFCO 2919 — Service review and sphere of Influence update for the San Bernardino Valley Water Conservation District; that there are five options the District should consider; that LAFCO has requested comments from various water agencies regarding the service review and sphere of influence update; that LAFCO will hold a hearing in August regarding the issue; that the District should consult with other water agencies ; that he will update the Board and report any new information at the next regularly scheduled Board Meeting. Minutes: 06/14/05 DISCUS AND POSSIBLE ACTON REGARDING RETENTION OF CALIFO STRATEGIES FOR CONSULTING PURPOSES was presented to the Board. M/ /C (Goodin -Lightfoot) that the Board of Directors' authorize the General Manager t retain and enter into a six (6) month commitment with California Strategies for the p ose of acquiring surplus land. The commitment is not to exceed $60,000.00. for approved. ' FEES AND EXPENSES FOR MAY 2005 were presented to the Board (Goodin -Lightfoot) that the Directors' Fees and Expenses for May 2005 be I AND POSSIBLE ACTION REGARDING EAST VALLEY WATER 2005-2006 BUDGET The Gener Manager reviewed the revised 2005-2006 Budget with the Board. Director G odin requested an additional Board Meeting to review the 2005-2006 Budget. A follow- meeting was scheduled for June 21, 2005 at 9:00 a.m. regarding the 2005- 2006 Budg t. No action t iken REVIEW AND ACCEPT FINANCIAL STATEMENTS FOR PERIOD ENDED APRIL 30 2005 2005 be (Sturgeon -Lightfoot) that Financial Statements for period ended April 30, MANAGER'S REPORT The Genera. Manager reported on the District's operations to date; he noted that AB 1234 could becoz ie law very soon; he updated the Board on the progress made at the Ad -Hoc Insurance C ommittee meeting; that an Independent Insurance consultant would review the District's c =ent coverage; that the District's Engineer Mr. Paul Dolter is retiring September , 2005. Information only. ORAL COMMENTS FROM BOARD OF DIRECTORS Director Lightfoot commented on Yucaipa Valley Water District's billing format change. 4 Minutes: 06/14/05 Director Goodin commented on an emergency meeting called by WRI regarding Jeff Davis' resignation as Director of the Water Resources Institute. Information only. There being no further verbal or written comments from the Directors, this section of the meeting was closed. CORRESPONDENCE FROM THE COUNTY OF SAN BERNARDINO REAL ESTATE SERVICES DEPARTMENT REGARDING THEIR WITHDRAWAL OF INTEREST OF SURPLUS LAND, APN: 1201-341-07 CORRESPONDENCE FROM THE CITY OF HIGHLAND REGARDING THEIR WITHDRAWAL OF INTEREST OF SURPLUS LAND, APN: 1201-341-07 ASSOCIATION OF THE SAN BERNARDINO COUNTY SPECIAL DISTRICT MEMBERSHIP MEETING HOSTED BY WEST VALLEY WATER DISTRICT, EL RANCHO VERDE COUNTRY CLUB, RIALTO, JUNE 20, 2005 HIGHLAND SENIOR CENTER'S ANNUAL VOLUNTEER RECOGNITION BREAKFAST, 2055 ELKS DR, HIGHLAND, JUNE 24, 2005 CLOSED SESSION The Board entered into Closed Session at 3:18 p.m. as provided for in the California Open Meeting Law, Government Code Section 54945.9(a), to discuss those items listed on the Agenda. ADJOURN TO REGULAR SESSION President Wilson declared that the meeting adjourn to regular session. ANNOUNCEMENT OF CLOSED SESSION ACTIONS The Board returned to session at 3:57 p.m. The items listed on the Agenda were discussed in closed session with the following actions being taken: With respect to item(s) #23,24,25,27 no action was taken. With respect to item #26, the Board by a unanimous vote, (Director Negrete absent) authorized the General Manager, Legal Counsel and Jim Cimino to respond to the offer made on the subject property. VI 1 1: The meeting was adjourned at 3:58 p.m. until the next regularly scheduled Board Meeting on June 28, 2005. Minutes: 06/14/05 Robert E. Martin, Secretary George E. "Skip" Wilson, President Minutes: 06/14/05 EXHIBIT "A" RESOLUTION 2005.12 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST VALLEY WATER DISTRICT ACCEPTING DEDICATION OF WATER DISTRIBUTION SYSTEM TRACT 16607 BE IT HEREBY RESOLVED by the Board of Directors of the East Valley Water District, as follows: WHEREAS, the water line system and appurtenant structures constructed in accordance with specifications of the East Valley Water District at Tract 16607 for public use in the City of Highland, have been dedicated to East Valley Water District by Highland Meadows Partners, LLC. NOW THEREFORE, BE IT HEREBY RESOLVED, that the Dedication of Water Distribution System dated May 10, 2005 and executed by Stan Stringfellow on May 10, 2005 be accepted and all rights, title and interest in and to said water system be vested in the East Valley Water District, and that the Secretary of this District be, and is hereby authorized and directed to record this Resolution with said Dedication of Water Distribution system attached hereto, in the office of the County.Recorder of the County of San Bernardino, State of California. *********************** The foregoing resolution was duly adopted at a meeting of the Board of Directors of the East Valley Water District, upon motion duly made, seconded and carried on June 28, 2005. AYES: Directors NOES: ABSENT: Attest: W2360 6/20/05 EAST VALLEY WATER DISTRICT George E. Wilson, Board President Robert E. Martin Board Secretary RECORDING REQUESTED BY: East Valley Water District WHEN RECORDED MAIL TO: Fast Valley Water District Post Office Box 3427 San Bernardino, California 92413 FEE EXEMPT PURSUANT TO GOVERNMENT CODE SECTION 6103 Board of Directors East Valley Water District San Bernardino, California 92413 IRREVOCABLE OFFER OF DEDICATION OF WATER SYSTEM DATE: May 10, 2005 We hereby declare that the water system and appurtenant structures to be constructed in The City of Highland. Tract 16607, Lots 1 thru 38. inclusive. County of San Bernardino in accordance with all the requirements of the East Valley Water District are intended for public use and that upon their acceptance by said District, all rights, title and interest of the undersigned in and to said water system shall thereupon vest in the District. The within dedication shall be binding upon heirs, successors, assignees, executors, or administrators of the undersigned. SEE EXHIBIT "K. The undersigned further declares and hereby certifies that there are no liens or debts of any nature presently due or outstanding against or upon said water system and appurtenant structures for labor or materials or for any other cause, and that the undersigned will hold East Valley Water District free and harmless from any and all such claims of liens asserted upon said water system and appurtenant structures should they be claimed or arise provided such claims or liens arose from acts which occurred on or before the date listed above. (Corporate Seal) HIGHLAND MEADOWS PARTNERS, LLC STATE OF CALIFORNIA ) COUNTY OF Leis A-v)geles ) On {D 20 _2:T, before me, the undersigned, a Notary Public in and for the said County and State, personally appeared s5i4-rL SS ei personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the same in his/her/their authorized capacity (!as), and that by his/her/their signature (s) on the instrument the person (s), or the entity upon behalf of which the person (s) acted, executed the instrument. WITNESS my hand and official seal Signature YJUJ tom-' (Seal) , MALISSA J. MEEKS Commission # 1380276 /§ d80. Notary Public -California (Rev: 2/6/02) Drawer No. 3 dos Angeles County MyComm. ExpiresOct 15.2]C6 EXHIBIT "A" RESOLUTION 2005.13 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST VALLEY WATER DISTRICT ACCEPTING DEDICATION OF SEWERS TRACT 16607 BE IT HEREBY RESOLVED by the Board of Directors of the East Valley Water District, as follows: WHEREAS, the sanitary sewers and appurtenant structures constructed in accordance with specifications of the East Valley Water District at Tract 16607 for public use in the City of Highland, have been dedicated to East Valley Water District by Highland Meadows Partners, LLC. NOW THEREFORE, BE IT HEREBY RESOLVED, that the Dedication of Sewers dated May 10, 2005 and executed by Stan Stringfellow on May 10, 2005 be accepted and all rights, title and interest in and to said sewers be vested in the East Valley Water District, and that the Secretary of this District be, and is hereby authorized and directed to record this Resolution with said Dedication of Sewers attached hereto, in the office of the County Recorder of the County of San Bernardino, State of California. *********************** The foregoing resolution was duly adopted at a meeting of the Board of Directors of the East Valley Water District, upon motion duly made, seconded and carried on June 28, 2005. AYES: Directors NOES: ABSENT: Attest: 52306 6/20/05 EAST VALLEY WATER DISTRICT George E. Wilson, Board President Robert E. Martin Board Secretary RECORDING REQUESTED BY: East Valley Water District WHEN RECORDED MAIL TO: East Valley Water District Post Office Box 3427 San Bernardino, California 92413 FEE EXEMPT PURSUANT TO GOVERNMENT CODE SECTION 6103 Board of Directors East Valley Water District San Bernardino, California 92413 IRREVOCABLE OFFER OF DEDICATION OF SEWERAGE SYSTEM DATE: May 10, 2005 We hereby declare that the sewerage system and appurtenant structures to be constructed in The City of Hiohland. Tract 16607, Lots 1 thru 38. inclusive. County of San Bernardino, in accordance with all the requirements of the East Valley Water District are intended for public use and that upon their acceptance by said District, all rights, title and interest of the undersigned in and to said sewer system shall thereupon vest in the District. The within dedication shall be binding upon heirs, successors, assignees, executors, or administrators of the undersigned. SEE EXHIBIT W. The undersigned further declares and hereby certifies that there are no liens or debts of any nature presently due or outstanding against or upon said sewerage system and appurtenant structures for labor or materials or for any other cause, and that the undersigned will hold East Valley Water District free and harmless from any and all such claims of liens asserted upon said sewerage system and appurtenant structures should they be claimed or arise provided such claims or liens arose from acts which occurred on or before the date listed above. (Corporate Seal) HIGHLAND MEADOWS PARTNERS, LLC STATE OF CALIFORNIA ) COUNTY OF Los Anne es ) On/f 1(C(Tl,a 20 (]S, before me, the undersigned, a Notary Public in and for the said County and State, personally appeared S+ah .54-mngArjin&, V personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the same in his/her/their authorized capacity (ies), and that by his/her/their signature (s) on the instrument the person (s), or the entity upon behalf of which the person (s) acted, executed the instrument. WITNESS my hand "and "official seal. Signature ?_e y�(,(,(,Uq�,�t. %xa-b'Y (Seal) ® commission J. MEEKS I Commission ft 1380276 z Notary Public • Callfomla � Los Angeles County if (Rev: 216102) Drawer No. 3 My Comm. E)ptresOct 15.2006 RESOLUTION NO. 2005.14 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE EAST VALLEY WATER DISTRICT AUTHORIZING GENERAL MANAGER TO RECORD CERTIFICATES OF LIEN FOR UNPAID CHARGES WHEREAS, the East Valley Water District ("the District") is a county water district organized and operating pursuant to the County Water District Law, Water Code Section 30000 et seq. ("the Act"). WHEREAS, pursuant to Water Code Section 31701.7, the District is authorized to lien property upon which delinquent charges exist for water and other services that have been rendered thereon by the District as follows: "In case any charges for water or other services, or either, remain unpaid the amount of the unpaid charges may in the discretion of the district be secured at any time by filing for record in the office of the county recorder of any county, a certificate specifying the amount of such charges and the name and address of the person liable therefor. From the time of recordation of the certificate, the amount required to be paid together with interest and penalty constitutes a lien upon all real property in the county pwned by the person or afterwards, and before the lien expires, acquired by him. The lien has the force, priority, and effect of a judgment lien and shall continue for 10 years from the date of the filing of the certificate unless sooner released or otherwise discharged. The lien may, within 10 years from the filing of the certificate or within 10 years from the date of the last extension of the lien in the manner herein provided, be extended by filing for record a new certificate in the office of the county recorder of any county and from the time of such filing the lien shall be extended to the real property in such county for 10 years unless sooner released or otherwise discharged." WHEREAS, pursuant to Water Code Section 31701(e), the District's Board of Directors ("the Board") is authorized to finnish to the board of supervisors and to the auditor of each county, on or before August 1 of each year, a written statement of those delinquent and unpaid charges for water and other services, or either, requested in writing by the owner of the property that remain delinquent and unpaid determined by the Board to be included therein ("Statement"). WHEREAS, pursuant to Water Code Section 31701.5, the amount of any charges for water and other services, or either, included in the Statement shall be added to and become a part of the annual taxes next levied upon the property subject to said charges and shall constitute a lien on that property as of the same time and in the same manner as does the tax lien securing such annual taxes. RESOLUTION NO. 2005.14 Page Two WHEREAS, pursuant to Water Code Section 31701.6, the District is required to notify the holder of title to land whenever delinquent and unpaid charges for water and/or other services which could become a lien on such property pursuant to Water Code Section 31701.5 remain delinquent and unpaid for 60 days. WHEREAS, pursuant to the authority contained in the Act, the Board adopted Ordinance Nos. 358 and 359 on April 9, 2001, which established the rules and regulations for water and sewer service, respectively, by the District. WHEREAS, the Board wishes to clarify the manner in which Ordinance Nos. 358 and 359 shall be implemented by the District to accomplish the collection remedies authorized by the above provisions of the Act. NOW, THEREFORE, BE IT RESOLVED by the Board as follows: Section 1. The District's General Manager and/or the General Manager's designee is hereby authorized to perform any and all acts authorized by Water Code Section 31701.7, including the filing for record in the office of the county recorder of any county such certificates of lien specifying and/or extending the amount of any unpaid charges for water and/or other services and the name and address of the person liable therefor. Section 2. The District's General Manager and/or the General Manager's designee is hereby instructed to perform the following: a. Preparation of an annual written Statement of those charges for water and/or other services requested in writing by the owners of property for which such services were rendered by the District that remain delinquent and unpaid for 60 days or more on July 1 of each year, which Statement shall be presented to the Board for adoption and subsequent submittal to the board of supervisors and to the auditor of each county on or before August 1 of each year pursuant to Water Code Section 31701(e), for inclusion in the annual taxes next levied on the properties subject thereto in accordance with Water Code Section 31701.5; and b. Any and all acts authorized and/or required by Water Code Section 31701.6, including providing notice to the holder of title to land whenever delinquent and unpaid charges for water and/or other services which could become a lien on such property pursuant to Section 2.a. above remain delinquent and unpaid for 60 days. Section 3. This Resolution shall take effect immediately upon its adoption and shall be applied such that the District is hereby authorized to perform any and all acts necessary to ensure operational compliance therewith. This Resolution shall be reviewed and revised as needed by the Board. RESOLUTION NO. 2005.14 Page Tbree ADOPTED this day of 2005. AYES: NOES: ABSTAIN: ABSENT: George E. Wilson, President ATTEST: Robert E. Martin, Secretary MAIN TAX PROCEDURE Part 7 § 31700. District defined § 31701 In this chapter "district' means a county water district formed under the provisions of the County Water District Act or this division. (Added by Stats.1949, c. 274, p. 525, § 1. Amended by Stats.1961, c. 674, p. 1913, § 5, eff. June 3, 1961.) Historical Note The 1961 amendment substituted "county Derivation: Stats.1913, c. 592, p. 1049, water district formed under the provisions § 25a, added by Stats.1935, c. 749, p. 2115, of the County Water District Act or this § 6, division" for "district all of which is con- tained in one county". Cross References District defined generally as to this division, see § 30013. Territory included in district, see § 30200. § 31701. Board statement If a district has no revenue or if the revenues of the district are, or in the judgment of the board of directors are likely to be, inadequate to pay the interest on or principal of any bonded debt as it becomes due, or any other expenses or claims against the district, ja if there are delinquent and unpaid charges, as defined in subdivision (e), outstanding, the board of directors shall, annually; on or before August 1st, furnish to the board of supervisors and to the auditor of each county, respectively, in writing: (a) An estimate of the minimum amount of money required to be raised by taxes in the county for the payment of its proportion of the amount required to pay the principal of or interest on any bonded debt of the district or of an improvement district therein as it becomes due. (b) A description of the improvement district benefited by the purposes of the bonded debt as stated in the resolution declaring the necessity to incur the bonded indebtedness, or, if the whole district was benefited by incurring it, a statement of that fact. (c) An estimate of the minimum amount of money required to be raised by taxes in the county for the payment of its proportion of the amount required to meet all the charges, claims, expenditures and expenses, other than a bonded debt, of each improvement district created in the county pursuant to this division, together with a description of each such improvement district as determined by resolution of the board. (d) An estimate of the minimum amount of money required to be raised by taxes in the county for the payment of its proportion of the amount required by the district for other expenses and claims against it. (e) A statement of those delinquent and unpaid charges for water and other services, or either, requested in writing by the owner of the 217 § 31701 COUNTY WATER DISTRICTS Div. 12 property that remain delinquent and unpaid for 60 days or more on July 1st determined by the board to be included therein. (f) The estimate of the minimum amount of money required to be raised by taxes in the county under subdivisions (c) and (d) shall not exceed the amounts permitted by any maximum property tax rate limitation in the Revenue and Taxation Code, provided however, that if no tax was levied by the district for either the 1971-1972 or the 1972-1973 fiscal year and the district incurred expenses in such years which expenses were paid from revenues other than taxes, then the maximum levy shall not exceed fifty cents ($0.50) per one hundred dollars ($100) of assessed valuation per year. (Added by Stats.1949, e. 274, p. 525, § 1. Amended by Stats.1949, c. 283, p. 558, § 1; Stats.1955, c. 1182, p. 2192, § 1; Stats.1961, c. 674, p. 1913, § 6, eff. June 8, 1961; Stats.1970, c. 17, p. 29, § 14; Stats.1971, c. 1211, p. 2330, § 1; Stats.1973, c. 241, p. 633, § 2; Stats.1974, c. 830, p. 1791, § 1.5.) Code Commission Notes Section 29040 of the Government Code requires the estimate to be furnished on or before July 10 in each year. That is a general provision. The above provision, being different and being also more specific, would appear to control. Historical Note The 1949 amendment added ifthe begin- ning of the section the words "If a district has no revenue or". The 1965 amendment inserted subdivision (c) and relettered former subdivision (c) to be subdivision (d). The 1961 amendment in the introductory paragraph inserted "or any part thereof' following "in which the district" and "of each county" following "to the auditor" (see 1970 amendment note); in subd. (a) inserted "to be raised by taxes in the county" follow- ing "of money required" and "its proportion of the amount required to pay" following "for the payment of"; in subd. (c) inserted "be raised by taxes in the county for the payment of its proportion of the amount required to" following "money required to" and "in the county" following "improve- ment district created", and in subd (d) in- serted "to be raised by taxes in the county for the payment of its proportion of the amount required" following "of money re- gaired". The 1970 amendment in the introductory paragraph substituted "annually, on or be- fore August 1st" for "at least 15 days before the fust day of the month in which the board of supervisors of the county in which the district or any part thereof is situated is required by law to levy the amount of taxes required for county pur poses". The 1971 amendment in the introductory paragraph inserted "or if there are delin- quent and unpaid charges, as defined in subdivision (e), outstanding"; and added subd. (e). The 1973 amendment in subd. (e) substi- tuted "those" for "any" following "A state- ment of', and inserted "determined by the board to be included therein" at the end The 1974 amendment added subd. (f). Derivation: Stata.1913, c. 592, p. 1062, § 21; Stats -1915, a 27, p. 29, § 3; Stats. 1928, a 152, P. 315, § 3; Stats.1925, c. 457, p. 989, § % Stats.1931, a 72, p. 82, § 3. Cross References Date of levy, see Government Code § 29100. Levy in excess of constitutional limitation, see Revenue and Taxation Code § 2237.2. 218 MAIN TAX PROCEDURE Part 7 Payment of bonds from revenues, see § $1007. Rates and charges by district, see § 81007. Library References. Waters and Water Courses e-1831/2. CJS. Waters § 243. Notes of Decisions 1. In general Act May 11, 1923, amending Act June 10, 1913, §§ 15, 21, 22, as amended by Stats. 1915, p. 26, Stats.1917, p. 225, and Stats. 1919, p. 816, by requiring that the lands benefited by creation of a proposed bonded indebtedness of a water district be stated in the board of director's resolution, and that only such lands be included in the voting precincts designated in the board's notice of § 31701.5 the election, etc., was not retroactive, so as to invalidate the further issuance and sale of bonds theretofore authorized, voted for, and directed to be issued and sold in con- formity with the statutes existing at the time of the resolution authorizing and the election approving them, nor did it alter the method of levying or collecting of taxes for payment of the principal and interest there- on. Montecito County Water Dist v. Doul- ton (1924) 224 P. 747, 193 C. 398. § 31701.5. Delinquent and unpaid charges for water and other services; inclusion in property taxes; lien; collec- tion costs The amount of any charges for water and other services or either included in the statement of delinquent and unpaid charges pursuant to subdivision (e) of Section 31701 shall be added to and become a part of the annual taxes next levied upon the property upon which the water for which the charges are unpaid was used and upon the property subject to the charges for any other district services and shall constitute a lien on that property as of the same time and in the same manner as does the tax lien securing such annual taxes. All laws applicable to the levy, collection and enforcement of municipal ad valorem taxes shall be applicable'to such charges, except that if any real property to which such lien would attach has been transferred or conveyed to a bona fide purchaser for value, or if a lien of a bona fide encumbrancer for value has been created and attaches thereon, prior to the date on which the first installment of such taxes would become delinquent, then the lien which would otherwise be imposed by this section shall not attach to such real property and the delinquent and unpaid charges relating to such property shall be transferred to the unsecured roll for collection. The county shall deduct from the charges collected an amount sufficient to compensate the county for costs incurred in collecting such delinquent and unpaid charges. The amount of such compensation shall be fixed by agreement between the board of supervisors and the district's board of directors. (Added by Stats.1971, c. 1211, p. 2331, § 2. Amended by Stats.1973, c. 861, p. 1571, § 14.) 219 § 31701.5 COUNTY WATER DISTRICTS Div. 12 Historical Note The 1973 amendment inserted the second sentence. Library References Waters and Water Courses 0-1881& 203, U.S. Waters §§ 243, 284 et seq. § 31701.6. Notice of delinquent and unpaid charges to holder of title to land E i , A district shall notify the holder of title to land whenever delinquent and unpaid charges for water and other services or either which could become alien on such property pursuant to Section 31701.5 remain delinquent and unpaid for 60 days. (Added by Stats.1971, c. 1211, p. 2331, § 2.5.) Library References Waters and Water Comes 4+1831/2, 208(15). C.T.S. Waters'§§ 243, 802. § 31701.7. Unpaid charges for iwater or other services; certi£- cate; recordation; lien; effect; extension In case any charges for water or other services, or either, remain unpaid the amount of the unpaid charges may in the discretion of the district be secured at any time by filing for record in the office of the county recorder of any county, a certificate specifying the amount of such charges and the name and address of the person liable therefor. From the time of recordation of the certificate, the amount required to be paid together with interest and penalty constitutes a lien upon all real property in the county owned by the person or afterwards, and before the lien expires, acquired by him. The lien has the force, priority, and effect of a judgment lien and shall continue for 10 years from the date of the filing of the certificate unless sooner released or otherwise dis- charged. The lien may, within 10 years from the filing of the certificate or within 10 years from the date of the last extension of the lien in the manner herein provided, be extended by filing for record a new certifi- cate in the office of the county recorder of any county and from the time of such filing the lien shall be extended to the real property in such county for 10 years unless sooner released or otherwise discharged. (Added by Stats.1979, c. 335, p. 1195, § 1.) § 31702. Levy and collection of tax After the board of directors has furnished the estimates as required in Section 31701, the board of supervisors of each county, annually, at the time and in the manner of levying other county taxes, shall: 220 DEVELOPMENT AGREEMENT THIS AGREEMENT is made this CP, day of `Atb , by and between EAST VALLEY WATER DISTRICT, a public agency ereinafter "the DISTRICT"), and MARQUEZ INVESTMENTS, a California Corporation (hereinafter "the DEVELOPER"). RECITALS A. The DISTRICT is a County Water District organized and operating pursuant to California Water Code Section 30000 et seq. B. The DEVELOPER proposes to subdivide and develop certain real property within the boundaries of the DISTRICT which is located at the west end of 20`h Street, west of Orange Street, in the City of Highland, County of San Bernardino, State of California, and is generally identified as Tract No. 10085 Lot 1 and 18 (hereinafter "the PROPERTY"). A copy of the Location Map for the PROPERTY is attached hereto as Exhibit "A" and is incorporated herein by this reference. C. The development of the PROPERTY will consist of 2 dwelling units, and the DEVELOPER desires that the DISTRICT provide domestic sewer service to the PROPERTY. The DEVELOPER intends to design and construct the facilities necessary for sewer service to be furnished to the PROPERTY. D. The DISTRICT supplies domestic sewer service within the area to be served and is the public agency empowered by law to provide such services to the PROPERTY. E. The purpose of this AGREEMENT is to provide the terms and conditions under which the DEVELOPER will design and construct the facilities necessary for the DISTRICT to supply sewer service to the PROPERTY (hereinafter "the PROJECT"). COVENANTS NOW THEREFORE, in consideration of the preceding Recitals and the mutual Covenants contained herein, the parties hereto agree as follows: Section 1. DESIGN OF FACILITIES. The DEVELOPER agrees to design the sewer facilities for the PROPERTY in the following manner and according to the Rules and Regulations of the DISTRICT: a. The DEVELOPER agrees to design the sewer facilities for the PROPERTY in accordance with the DISTRICT'S Standards for Design and Processing of Sewer Plans. The designs shall be submitted to the DISTRICT in a complete form which shall provide sufficient information for review and approval by the DISTRICT in the exercise of its sole discretion. b. The DISTRICT may request certain changes in the plans, which DEVELOPER agrees to incorporate into the plans and specifications for the PROPERTY. C. The DEVELOPER shall submit all plans, drawings, specifications, and contract documents, for all work to be performed pursuant to this AGREEMENT, to the DISTRICT for review and approval, if adceptable to the DISTRICT. The DISTRICT agrees to review all such documents in a timely manner and, upon inclusion of all changes thereto requested by the DISTRICT in a manner satisfactory to the DISTRICT, the DISTRICT will provide the DEVELOPER with authorization to proceed. The DEVELOPER shall not proceed with the construction of the PROJECT and any other sewer facilities for use on the PROPERTY until the DISTRICT so authorizes. Section 2. CONSTRUCTION OF FACILITIES. The DEVELOPER agrees to construct the PROJECT and all other sewer facilities necessary for the PROPERTY in the following manner subject to the DISTRICT'S approval: a. The DEVELOPER shall obtain all necessary permits from the City of Highland and all other public or private agencies required for the construction thereof. The PROJECT and the facilities appurtenant thereto shall be constructed at a location determined by the DISTRICT, and shall be relocated by the I DISTRICT at the DEVELOPER'S sole expense if such relocation is deemed necessary by the DISTRICT in its sole discretion. The DEVELOPER hereby grants the DISTRICT full access to the PROPERTY and all other locations where the work contemplated herein is to be performed. b. All facilities constructed pursuant to this AGREEMENT shall be in accordance with accepted standards and practices in the industry and in compliance with all local, state, and federal laws, rules, and regulations. The DEVELOPER shall be responsible for providing all labor, materials, and equipment necessary to perform the work for the PROJECT, and such work shall be performed in a timely and workmanlike manner by a party or entity acceptable to the DISTRICT. All such facilities shall conform to the DISTRICT'S Standard Specifications for the Furnishing of Materials and the Construction of Sewer Pipelines. All costs and liabilities in connection with the design and construction of the PROJECT shall be bome solely by the DEVELOPER. C. The DISTRICT shall inspect and approve all work to be performed under this AGREEMENT. However, any approval by the DISTRICT of such work, or of the designs, specifications, reports, and/or materials furnished hereunder, is understood to be conceptual approval only and will not operate to relieve the DEVELOPER or its contractors, consultants, or subcontractors of responsibility for complying with all laws, codes, industry standards, and liability for damages caused by negligent acts, errors, omissions, noncompliance with industry standards, or their own willful misconduct. Further, neither the DISTRICT'S review, approval, or acceptance of any of the work or services performed in connection with this AGREEMENT shall be construed as a waiver of any rights hereunder or of any defense or cause of action which the DISTRICT may have arising out of the performance of this AGREEMENT or any previous or subsequent agreements. The DEVELOPER shall cause the facilities constructed 3 under this AGREEMENT to be inspected as required by any and all other public or private agencies. Section 3. DEVELOPER'S COSTS. In addition to all other obligations imposed upon the DEVELOPER under this AGREEMENT, the DEVELOPER shall be responsible for the payment of all of the following: a. The DEVELOPER shall pay to the DISTRICT all, or any portion, of the applicable connection fees for the PROPERTY at the time of application for sewer service therefor. The DISTRICT will provide sewer service only to those specific lots within the PROPERTY for which payment in full has been made to the DISTRICT. b. The DEVELOPER shall be solely responsible for the payment of all costs, fees, and expenses associated with the construction, inspection, operation, maintenance, repair, and r6location of the PROJECT, including all costs, fees, and expenses incurred for the environmental analysis, engineering, and design of the PROJECT. C. The DEVELOPER shall comply with all rules, regulations, resolutions, and ordinances of the DISTRICT that are currently in place or may hereafter be adopted, and shall pay when due any and all fees, deposits, charges, rates, fines, penalties, taxes, and/or assessments that may be levied by the DISTRICT. d. The DEVELOPER hereby consents, and waives any objection, to the exercise of any and all collection remedies that are available to the DISTRICT under the law upon the PROPERTY and/or the person and/or property of DEVELOPER and its shareholders and partners. Section 4. SECURITY. a. The DEVELOPER shall provide performance, completion, and/or payment bonds for the PROJECT in the minimum amount of not less than 100 percent of the estimated construction costs containing covenants which are acceptable to the DISTRICT and the (cityor county) . b. The DEVELOPER shall provide a maintenance bond for the PROJECT in the amount of 100 percent of the construction cost, which shall contain covenants which are satisfactory to the DISTRICT. Such bond shall remain in force for at least twelve (12) months from the date of acceptance by the DISTRICT of the dedication of said facilities. C. The DEVELOPER shall also procure and maintain during the performance of this AGREEMENT such policies of insurance, bonds from an acceptable surety, cash deposits, escrow accounts, letters of credit, and other forms of security, in amounts and upon terms deemed sufficient by the DISTRICT in its sole discretion to protect the DISTRICT from any and all exposure to loss and/or liability. Section 5. DEDICATION OF FACILITIES. a. The DEVELOPER shall, upon completion of the construction of all facilities to be installed hereunder to the satisfaction of the DISTRICT, dedicate said facilities to the DISTRICT by a deed of dedication or such other instrument as the DISTRICT may prescribe, and the DISTRICT agrees to accept the dedication thereof by formal action of its Board of Directors. Thereafter, such dedicated facilities shall become and be operated and maintained by the DISTRICT as part of the DISTRICT'S sewer system. The DISTRICT shall not accept dedication of said sewer facilities until all connection fees have been paid unless otherwise allowed under Section 3.a. herein. Section 6. SERVICE RESTRICTIONS. Any obligation on the part of the DISTRICT to provide sewer service to the PROPERTY pursuant to the terms of this AGREEMENT shall be excused in the event that the performance thereof is interrupted for any of the following reasons: riots, wars, sabotage, civil 1 disturbances, insurrection, explosion, court order, natural disasters such as floods, earthquakes, landslides and fires, and other labor disturbances and other catastrophic events which are beyond the reasonable control the DISTRICT. Notwithstanding any other provision to the contrary, the DISTRICT may suspect or refuse sewer service to the PROPERTY if the DEVELOPER is in breach, default, or violation of this AGREEMENT or any rule, regulation, resolution, and/or ordinance of the DISTRICT that is currently in place or may hereafter be adopted, or if such service would adversely affect the health, safety, or welfare of the DISTRICT'S customers, or for any other reason deemed paramount by the DISTRICT in its sole discretion. Section 7. LIABILITY FOR DAMAGES. The DISTRICT shall not be held liable or responsible for any debts or claims that may arise from the operation of this AGREEMENT, or for any damage claims for injury to persons, including the DEVELOPER and/or its officers, directors, shareholders, guests, invitees, trespassers, agents, contractors, 'consultants, and employees, or for property damage, from any cause arising out of or in any way related to the PROPERTY, the PROTECT, and/or the DEVELOPER'S obligations hereunder. Section 8. RELEASE. The DEVELOPER hereby expressly waives and releases the DISTRICT and its agents, officers, directors, and employees from any and all liability for the claims, actions, and/or losses set forth in Section 9 above and for any costs and expenses incurred in connection therewith. The DEVELOPER, notwithstanding the provisions of California Civil Code § 1542, which provides as follows: "A g eneral r elease d oes n of a xtend t o c laims which the creditor did not know or suspect to exist in his or her favor at the time of the executed release which if known by him or her must have materially affected his or her settlement with the debtor." expressly waives and relinquishes all rights and benefits afforded to the DEVELOPER thereunder and under any and all similar laws of any state or territory of the United States with i respect to the claims, actions, and/or losses referenced above. This AGREEMENT shall act as a release of any claims that may arise from the aforementioned whether such claims are currently known or unknown. The DEVELOPER understands and acknowledges the significance and consequences such specific waiver of Civil Code § 1542 and hereby assumes full responsibility for any injuries, damages, losses, or liability that may result from the claims identified above. This AGREEMENT shall also act as a release of any claims, actions, and/or losses set forth in Section 9 above, that may arise in the future whether such claims are currently foreseen or unforeseen. Section 9. HOLD HARMLESS. Excepting the sole or active negligence or willful misconduct of the DISTRICT, the DEVELOPER shall indemnify and hold the DISTRICT and its officers, directors, agents, and employees harmless from and against all claims and liabilities of any kind arising out of, in connection with, or resulting from, any and all acts or omissions on the part of the DEVELOPER and/or its officers, directors, shareholders, partners, assignees, guests, invitees, trespassers, agents, contractors, consultants,'and employees in connection with the PROPERTY, the PROJECT, and the performance of their obligations under this AGREEMENT, including design defects, even if occurring after the completion of the PROJECT, and defend the DISTRICT and its officers, directors, agents, and employees from any suits or actions at law or in equity for damages, and pay all court costs and counsel fees in connection therewith. In addition, the DEVELOPER agrees to defend, indemnify, and hold the DISTRICT harmless from and against all claims, losses, liabilities, damages, demands, actions, judgments, causes of action, assessments, penalties, costs, expenses (including, without limitation, the reasonable fees and disbursements of legal counsel, expert witnesses, and accountants), and all foreseeable and unforeseeable consequential damages which might arise or be asserted against the DISTRICT and/or the DEVELOPER with regard to the PROPERTY and/or the PROJECT which are alleged and/or determined to be tortious, and/or in violation of present and future federal, state, and local laws (whether under common law, statute, rule, regulation, or otherwise), including, but not limited to, the California Environmental Quality Act, Public Resources Code Section 21000 et seq., and the Guidelines adopted thereunder, California Code of Regulations Section 15000 et seq., all as the same may be amended from time to time. Section 10. NOTICES. Any notice, tender, or delivery to be given hereunder by either party to the other shall be effected by personal delivery in writing or by registered or certified mail, postage prepaid, return receipt requested, and shall be deemed communicated as of mailing or in the case of personal delivery, as of actual receipt. Mailed notices shall be addressed as set forth below, but each party may change its address bywrittennotice in accordance withthis section. If to the DISTRICT: East Valley Water District P.O. Box 3427 1155 Del Rosa Avenue San Bernardino, CA 92413 Attn: General Manager If to the DEVELOPER: Attn: Section 11. DISPUTES. Any dispute or controversy arising out of, under, or in connection with, or in relation to this AGREEMENT, and any amendments thereto, or the breach thereof, which is not resolved informally by prior mutual agreement of the parties hereto, shall be submitted to arbitration in accordance with the California Arbitration Act, Sections 1280 through 1294.2 of the Code of Civil Procedure. The cost of such arbitration shall be paid by the parties equally; however, the prevailing party in the arbitration shall be entitled to reimbursement of its attorneys fees and other costs incurred in connection therewith. Section 12. ATTORNEYS FEES. If a dispute arises which cannot be resolved by arbitration, regarding the breach or enforcement of the provisions of this AGREEMENT, the prevailing party therein shall be entitled to recover all attorneys fees and other costs actually incurred in connection with reaching a resolution of the dispute whether or not an action, claim, 8 or lawsuit is filed. In any action brought, the entitlement to recover attorneys fees and costs will be considered an element of costs and not of damages. Section 13. INUREMENT. This AGREEMENT and all provisions hereof shall be jointly and severally binding upon, and inure to the benefit of, the parties hereto, their respective heirs, successors, legal representatives, and assigns, and each of the shareholders and partners of the DEVELOPER in their individual, separate, and/or other capacities. Section 14. ASSIGNMENT. This AGREEMENT may not be assigned to any individual or entity without the written consent of the parties hereto. Section 15. INTEGRATION AND AMENDMENT. This AGREEMENT constitutes the entire understanding of the parties hereto with respect to the subject matter hereof and supersedes any and all prior agreements, whether oral or written, between the parties in connection therewith. This AGREEMENT may not be amended unless in writing and signed by the parties hereto. Section 16. CAPTIONS. The captions of sections and subsections of this AGREEMENT are for reference only and are not to be construed in any way as a part of this AGREEMENT. Section 17. INTERPRETATION AND ENFORCEMENT. This AGREEMENT shall not be construed against the party preparing it, but shall be construed as if both parties jointly prepared this AGREEMENT and any uncertainty or ambiguity contained herein shall not be interpreted against any one party. Failure by either party to enforce any provision of this AGREEMENT, or any waiver thereof by such party, shall not constitute a waiver of said party s right to enforce subsequent violations of the same or any other terms or conditions herein. This AGREEMENT shall be enforced and governed by and under the laws of the State of California, and venue for any action brought to interpret and/or enforce any provision of this AGREEMENT shall be in a state or federal court located in the State of California that would generally have in rem jurisdiction over the PROPERTY. O Section 18. SEVERABUM. If any portion of this AGREEMENT is declared by a court of competent jurisdiction to be illegal, invalid, or unenforceable, the remaining provisions of this AGREEMENT shall continue in full force and effect. Section 19. TIME OF THE ESSENCE. Time is of the essence in this AGREEMENT, and the parties hereto agree to proceed in good faith, with due diligence, to complete all covenants and c onditions s et forth h erein a nd t o p erform such further acts as is reasonably necessary to effectuate the purpose of this AGREEMENT. Section 20. AUTHORITY. Each individual executing this AGREEMENT on behalf of a party hereto represents and warrants that he or she is fully and duly authorized and empowered to so execute on behalf of such party, and that this AGREEMENT is binding in the manner set forth in Section 15 hereof. 10 IN WITNESS WHEREOF, the parties hereto have caused this AGREEMENT to be executed by their respective officers as of the date first above written. Um President, Board of Directors ATTEST: Secretary DISTRICT East Valley Water District DEVELOPER: By: [name] [title] rl ATTEST: Notary Public 11 I ao 0 F STREET 20 TH STREET !tl EXHIBIT' "AI' CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California County of GA (� 1l 1 lei f12 r e \ 1 as. c �/� On 6 Q itDab Ids- before me, rn T personally appeared NELLY SANCHEZ Comm.01464710 N NOV cww0xu N Mr Comm. EVIin 10 101 -a 'Jong Dog, Wo PwW'9 m-P�rsonaliy known to me ❑ proved to me on the basis of satisfactory evidence to be the person.(ay whose nameWQVare subscribed to the within instrument and acknowledged to me tha0afthey-executed the some ini� s eOUGirthorized capacity(ies), and that by his edipeir signature(s)ron the instrument the persoq(e); or the entity upon behalf of which the persogW- acted, executed the instrument. WITNESS my hand and�official seal. OPTIONAL Though the inthnnedon below is not required by law, It may prove valuable to persons retying on the document and could prevent fraudulent removal and reattachment of INS form to another document. Description of Attached Document Title or Type of Document:>✓�� Document Date:Number of Pages: Signer(s) Other Than Named Above: Capacity(les) Claimed by Signer Signer's Name: ❑ Individual ❑ Corporate Officer —Title(s):_ O Partner —0Umited 0General ❑ Attomey-in-Fact ❑ Trustee ❑ Guardian or C ator • Other: Is RIGffr Ut.18PRRn -: OFSIGNER 0 1999 Naaor N91ary Asaoca0 •9350 00 Sora Avg., P0. Bon M2 • C at mrh. CA 913132402 • vmvv.naaonanWwyot9 Pma. No.5907 RgaNar. Call To6Plae 1-906876.9927 CERTIFICATE OF LIEN JUNE 28, 2005 TOTAL $ 797.67 * STILL OWNS PROPERTY + MULTIPLE UNITS Page 1 of 1 ACCOUNT OWNERS PROPERTY AMOUNT NUMBER NAME ADDRESS OWED 1. 0530031-01 $46.27 2. 0530191-02* $113.69 3. 0630029-04 $93.89 4. 0920167-06* $29.07 5. 1120291-01* $153.54 6. 1130241-02* $138.37 7. 1210593-18* $48.59 8. 1550663-01 $22.34 9. 1620082-00* $65.20 10. 1640052-03* $86.71 TOTAL $ 797.67 * STILL OWNS PROPERTY + MULTIPLE UNITS Page 1 of 1 TVD East Valley Water District Board Memorandum From: Brian W. Tompkins / ChiefFiancial Officer Subject: Disbursements. C// Recommendation: Approve the attached list of accounts payable checks and payroll issued during the period June 9, 2005 through June 22, 2005. Background: Date: June 28, 2005 Accounts payable checks are shown on the attached listing and include numbers 202071 fo 202244 for a total of $609,695.37. The source of funds for this amount is as follows: Arroyo Verde Funds Construction Fund —Loan Unrestricted Funds $609,695.37 Payroll disbursed was for the period ended June 10, 2005 and included checks and direct deposits, Totaling $126,180.86. Directors payroll disbursed was for the period ended May 31, 2005 included checks and direct deposits totaling $6,670.40. Total disbursements $742,546.63. 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Q Q w J ul V v ZO Q G Q Z Q W W O Q LL_ U 0 O J J Q y Qy O y a > CL 2Lu Z Q C~i U U U m U' C7 D d W O LL aj U m W LU m an NJ No�J� oQp�J� MJ oJ�� > mm rO g x ,,pa ,,,pa p.I z z z c c (T' (T� CT' 7D7 Q W � g g QoQZQQ Q�� - > m cm um cm co co co m tum m C= � � � � µ Qb' � � >>I >>>! l>W>1 1>W>l N N N N N N N N N N N N N N N N N N N ud UH U U U U U U U U U U U U U U U U U U U N N m m A N O O N N M v N N m A r A oz N 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O Z N N N N N N N N N N N N N N N N N N N k� k6 2/$ M ! k k k ) Ci k)(§§ k k o R ; e ; 2 ; § $ ` § 22 - - k LLLU» CDk � 2 cn 01Dw1 2 CL / k k \ « K \ k U ( § k 2 ( U. k k § 2 2 § § § ( § § § § ( � / LOCAL AGENCY FORMATION COMMISSION COUNTY OF SAN BERNARDINO 175 West Fifth Street, Second Floor San Bernardino, CA 92415-0490 • (909) 387-5866 • Fax (909) 387-5871 E -mall: lafco@lafco.sbcounty.gov www.sbclafco.org s DATE: MARCH 7, 2005 FROM: KATHLEEN ROLLINGS-McDONALD, Executive Officer TO: LOCAL AGENCY FORMATION COMMISSION SUBJECT: AGENDA ITEM #6 — LAFCO 2919 — Service Review and Sphere of Influence Update for the San Bernardino Valley Water Conservation District INITIATED BY: Local Agency Formation Commission for San Bernardino County RECOMMENDATION: Staffs recommendation is that the Commission continue consideration of LAFCO 2919 to the May 18, 2005 hearing with the direction to staff to review questions with San Bernardino Valley Water Conservation District staff to provide additional information on: 1 District expenditures for the past two fiscal years and the current fiscal year related to costs associated with the Water Rights Application, expenditures for Board of Directors, spreading of water, etc. District revenues generated for the past two fiscal years and the current fiscal year related to receipts from mining interests and groundwater spreading charge. 3: The statutory provisions related to potential consolidation of districts formed under different principal acts including, but not limited to, the transfer of groundwater charges, succession to mining leases between the District and mining interests. LAFCO 2919 - Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 4. If consolidation is not considered, would. the appropriate sphere of influence designation for this District be the limits of the Bunker Hill Basin rather than merely a portion of its eastern area. However, if the Commission feels that adequate information has been provided by the District for the affirmation of its existing sphere of influence and that the questions surrounding the distinction of the Bunker Hill Basin are answered, it may take the following actions to close this consideration: 1. Determine that the affirmation of the District's existing sphere of influence through LAFCO 2919 is statutorily exempt from environmental review and direct the Clerk to file a Notice of Exemption within five days; 2. Make the findings related to a service review required by Government Code Section 56430 and determine that the sphere of influence for the San Bernardino Valley Water Conservation District should be affirmed in its present configuration; and, 3. Defer adoption of the resolution making these determinations to the consent calendar for the April 20, 2005 Commission hearing. ' BACKGROUND INFORMATION: This proposal was initiated by the Local Agency Formation Commission on January 15, 2003, in response to State mandates requiring service reviews and sphere of influence updates for all cities and special districts on a rotating five-year schedule. This is the final agency to be discussed within the East Valley agency reviews. Included in this report are the following attachments: #1 -- maps which identify the boundaries and sphere of influence for San Bernardino Valley Water Conservation District (hereafter SBVWCD) along with overlay maps showing the relationship of the District to the Cities and Water Districts within its jurisdiction. #2 -- outline of the purposes and structure of a Water Conservation District. #3 -- staff report for LAFCO 2751, consideration of an annexation to the San Bernardino Valley Water Conservation District. 2 LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 #4 -- District Summary Profile Sheet and the response provided by the District to the LAFCO survey of the factors required by Government Code Section 56430 for a service review. WATER CONSERVATION DISTRICTS: Attachment #2 to this report includes a general outline of a Water Conservation District and the services it can perform under its principal act, prepared by LAFCO staff. As noted, Water Conservation District Law has been in existence since 1931 as a means to address locally the conservation of water and water rights within an area which is defined as the "watershed providing the water supply to its inhabitants". The services that can be offered by a Water Conservation District include: 1. Appropriate, acquire and conserve water and water rights for any useful purpose; 2. Make surveys and investigations of the water supply and resources of the district; S. Acquire and construct dams, reservoirs, canals, conduits, spreading basins and sinking basins in order to conserve, store, spread and sink water; 4. Provide for the construction, operation, and maintenance of such works, facilities and operations within or outside the district's boundaries to protect the land or property in the district from damage by flood or overflow; 5. Drill, construct, install and operate wells, pumps, pipelines, conduits, valves, etc. and may pump water from these facilities for sale, delivery, distribution or other disposition; 6. Sell, deliver, distribute or otherwise dispose of any water that may be stored or appropriated, owned or controlled by the district; 7. Acquire, construct, maintain, and operate recreational facilities in connection with any dams, reservoirs or other works owned or controlled by the District. As this outline notes, the functions and purposes of these types of districts are limited to the preservation of the water supply within a given area. In San Bernardino County there are two water conservation districts, both serving within 3 LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 the Valley portion of the County (their service areas are outlined on the vicinity maps within Attachment #1). In each case they are located and serve within managed water basins — Chino Basin Water Conservation District serving the west - end area of the Valley associated with the Inland Empire Utilities Agency service area, and the SBVWCD serving the east -end of the Valley associated with the San Bernardino Valley Municipal Water District service area. Due to the regional nature of these agencies and their minimal annexation activity, they have had little official contact with LAFCO during the past 40 years. In 1993, the Commission reviewed and approved an annexation proposal involving the SBVWCD expanding its boundaries by approximately 2,929 acres (LAFCO 2751). LAFCO 2751 was highly controversial due to the District's recent imposition of a groundwater charge and ultimately resulted in a modification to the boundaries to exclude the area of the District's sphere of influence within the Santa Ana River comprising 1,980 acres. This exclusion was based upon agreements reached between the District and the major water producers within the area which included the City of Riverside, the Western Municipal Water District of Riverside County, the Aqua Mansa Water Company, Meeks and Daley Water Company and the Riverside Highland Water. Company. This 1,980 acre area remains the District's sphere of influence area outside its boundaries. •A copy of the LAFCO staff -report related to this proposal is included as Attachment #3. SERVICE REVIEW. The SBVWCD was formed in 1931, immediately following the implementation of Water Conservation District law as a means "to proteet against excessive export of the local surface water by downstream agencies". The District operates recharge facilities in two areas — the Santa Ana River and Mill Creek. The SBVWCD is an independent special district formed under the provisions of Water Conservation District law (Water Code Sections 74000 through 76501). r In reference to the factors and findings required for a service review, the District provided a response in 2003 for Commission consideration along with numerous appendices, a copy of which is available for review in the LAFCO office. The report prepared by the SBVWCD is comprehensive in its review of the factors required by Government Code Section 56430. During the interim period, staff has met with the District on two occasions to discuss the service review/sphere update and to request updated materials due to the time delay in processing. The District has provided additional materials to assist staff in its review. The survey response contained in the District's response will not be reiterated in this report and is included as an attachment to this report along with some of the appendix documents (Attachment #4). H LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 Appendix materials included as a part of Attachment #4 are: 1. The District's Draft "Program for Effective Recharge Coordination" or PERC dated June 2004, which defines the methods it will use in performing its functions, and a spreadsheet listing of the water spread for conservation purposes in Mill Creek and the Santa Ana river; 2. A copy of the letter received from the District in regard to the Seven Oaks Dam Borrow Site Restoration Project; 3. The Proposed Land Management and Habitat Conservation Plan for the Upper Santa Ana River Wash; and, 4. A spreadsheet outlining the amount of water spread historically in the Santa Ana River and Mill Creek by the District. The District's materials include the identification of its mission statement as follows: "The mission of the San Bernardino Valley Water Conservation District is to ensure recharge of the Bunker Hill Groundwater Basin in an environmentally and economically responsible way, using local native surface water to the maximum extent practicable. We strive. to improve the supply and quality of groundwater, balancing such demands with those of land, mineral and biological rerkources." A summary of the major points of consideration within the response provided by SBVWCD and those areas which have prompted additional staff questions are outlined as follows: r 1. Infrastructure Needs and Deficiencies: The District materials have indicated that most of the District's canals and percolation basins were constructed in the 1930's and remain in good condition at the present time. Their purpose has been to divert water from the Santa Ana River and Mill Creek for spreading and percolation within District facilities for recharge of the Bunker Hill Basin for better than 90 years. The materials indicated that the District plans to reconstruct its percolation basin in the "Borrow Site" for the Seven Oaks Dam which has been non -operational during that facility's construction period. The total acreage owned by the District for percolation purposes includes 5 LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 approximately 185 acres in the Santa Ana River area and 65.5 acres in Mill Creek. The materials identify that the highest level of recharge during the District's history was 52,172 acre feet in the Santa Ana River in 1978 and 19,800 acre feet in 19Mi 93 in ll Creek. The District's ability to perform its function is directly related to the amount of surface water within the Santa Ana River and Mill Creek tributary available for spreading. The District anticipates that, under the auspices of the Upper Santa Ana River Wash Land Management and Habitat Conservation Plan, additional percolation basins and ancillary facilities could be constructed for a total of 45 acres for percolation within the Santa Ana River, depending upon determinations of that study. The District has indicated that it is one of many entities that have been working together to manage the groundwater in the Bunker Hill Basin (FERC, page 15). The District has indicated that due to the number of agencies involved in the Bunker Hill Basin and the number of uses of the water of the Santa Ana River, a coordinated, inter -agency approach is required. According to the District's Audit Report for 2003-04, one of its unanticipated, one-time expenses relates to its Water Rights application before the State Water Resources Control Board. This application is one of a series related to changes to the Santa Ana River since the construction of the Seven Oaks Dam. The Water Conservation District, the San Bernardino Valley and Western Municipal Water Districts, and the Orange County Water District all have or had applications on file with the State Water Resources Control Board for permits to divert water from the Santa Ana River. 2. Financial Constraints and Opportunities: The District is currently in sound financial condition with limited debt and significant reserves. The 2004 Audit Report (included as part of Attachment #5) for the District identified a shortfall between revenues received and actual expenditures of $686,497 for the period. The report identifies that this situation was predicated upon a number of one-time expenses for the District, including costs associated with its Water Rights Application identified as $361,585 and a $414,000 purchase of State Project water which were partially offset by additional revenues. The District anticipates a full reimbursement of the 2 LAFCO 2919 - Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 costs for State Project water over time through payments of the water purveyors in the area. This report also identifies that the budgets for ensuing years will recognize the need to bring costs into balance against the revenues received in each fiscal year. The Audit Report identifies that the District has pooled investments of $8,257,618 with the State of California State Treasurer's Local Agency Investment Fund. However, $5,000,000 of this amount is deferred revenue received as an advance from mining interest for pre -paid mining royalties. The notes within the Audit Report indicated that this amount may be required to be repaid, however, "the District does not expect such conditions to arise and through its participation in the Wash Plan is helping to ensure this is the case". Pursuant to the District's PERC, it maintains a policy of "pay as you go" which requires that facilities maintenance, enhancement or new construction are identified during the District's annual budget process and funding of activities through current resources or reserves identified. Questions of staff related to the financial information presented to the Commission by the District include the following: a. For 2003-2004 the audited actual expenditures for the District were $2,359,693. Subtracting the one-time expenses identified in the report of $686,497 leaves operating expenditures of $1,673,196 to administer and spread a total of 6,025 acre feet of water within both the Santa Ana River and Mill Creek areas in pursuit of the District's legislative charge. However, the revenues associated with Groundwater Replenishment are listed as $501,300 and include the groundwater assessments, but do not include the Mining Income from lands the District owns for future use as water conservation areas. b. The annual costs identified in the 2003-04 budgets and.the 2004-05 budgets for Director expenses are $55,000, which is approximately $7,857 per director for the year. Meeting costs in 2003-04 were estimated at $32,000. However, in 2004-05 the budget accounts were renumbered and retitled so that LAFCO staff, at the present time, can only assume that the meeting expenses would be a compilation of Account # 6063 Meeting support expense ($2,500), a portion of Conference/Seminar Registrations Account #6081 ($18,000), a portion of lodging expense Account #6078 ($22,900), and meals Account #6075 ($7,900). 7 LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 C. No mention is made of an Appropriation limit for this District. 3. Cost Avoidance Opportunities and Shared Facilities Opportunities: Much of the District's activities outlined in its survey response have historically been projects with other agencies. The report identifies the following joint efforts by the District: a. Upper Santa Ana River Wash Land Management and Habitat Conservation Plan — This is a joint effort with the Cities of Highland and Redlands, the County, SBVWCD, and the U.S. Bureau of Land Management as landowners and/or agencies with responsibility within the area (information included as a part of Attachment #4). One outcome anticipated through this effort has been the designation of areas for future mining activities to be consolidated as well as defining future locations for water conservation activities. This is of special importance to the District as lands it owns are leased for sand and gravel extraction and the leases and royalties for these activities represents approximately 50% of the District's revenues as well as their identified need for restoration and/or expansion of percolation basins in the easterly portion of this project. One concern of staff regarding this effort is the lack of designation of the on-going maintenance and operation entity for the Habitat lands. b. Santa Ana River -Mill Creek Cooperative Water Project (the Exchange) — This is an agreement between ten public and private water agencies to allow for transfer of water among the agencies. SBVWCD has been assigned the responsibility to monitor the transfers, account for the waters exchanged, and report these matters to the other members. c. High Groundwater Mitigation Project — The District is participating in a program which will address the issues of the high groundwater within the reaches of the Bunker Hill Basin with the water producers and retailers in the area. d. Drought Mitigation Project — District purchased State Water Project waters at a discounted cost to spread within the District's boundaries to alleviate low groundwater levels brought on by the drought. The costs of this water will be charged back to the entities using the water and the District's investment refunded. 0 1 AFCO 2919 — Service Review/ Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 4. Government Structure Options: The District was originally established in 1931 by election and the assets of its predecessor, the Water Conservation Association in the Santa Ana River, were transferred for use and operation by the District. In 1935, it acquired the assets of the East Lugonia Mutual Water Company to provide for water spreading and percolation within Mill Creek, a tributary to the Santa Ana River. Today, the District's boundaries include approximately 50,000 acres (78+ square miles) including territory within portions of the Cities of San Bernardino, Colton, Loma Linda, Highland, Redlands and Yucaipa, along with the unincorporated community of Mentone and various unincorporated areas. This area is served by a number of water retailers including the East Valley Water District, Yucaipa Valley Water District, and the Cities of San Bernardino, Loma Linda, Redlands, and Colton. Also overlying the boundaries of the District, as outlined on maps within Attachment #1, are two other agencies authorized to provide water conservation services — the San Bernardino Valley Municipal Water District and the San Bernardino -County Flood Control District: a: The San Bernardino Valley Municipal Water District operates under Municipal Water District Law (Water Code Section 71000 through 73000) and is authorized the power to: "Acquire, control, distribute, store, spread, sink, treat, purify, reclaim, recapture, and salvage any water, including sewage and storm waters, for the beneficial use or uses of the District, its inhabitants or the owners of rights to water in the district..." as well as "...Acquire waterworks or a waterworks system, waters, water rights, lands, rights, and privileges; construct, -maintain, and operate conduits, pipelines, reservoirs, works, machinery, and other property useful or necessary to store, convey, supply or otherwise make use of water for a waterworks plant or system for the benefit of the district..." In addition, this agency along with its Riverside counterpart, is the Water Master for the 1969 judgment determining the amount of water allowed for withdrawal to maintain the waterflow received by Orange County. The flows of the Santa Ana River are directly affected by the Bunker Hill Basin and the San Bernardino Valley Municipal Water District overlays the majority of this basin. E LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 b. The San Bernardino County Flood Control District operates under provision of the Water Code Appendix 43-1 and was formed in 1939. It is authorized under Section 43-2(6) the powers of "water conservation; water rights; litigation', outlined in part as follows: "To store water in surface or underground reservoirs within or outside of the district for the common benefit of the district; to conserve and reclaim water for present and future use within the district..." This entity as well overlays the whole of the Bunker Hills Basin, while its flood zones divide the area of the District. SBVWCD has indicated its opinion that a future consolidation of the District would require an election of the people, as well as its opinion that its customers, the Cities, retail water providers and entities extracting water from the basin, would not support such a consolidation. Staffs response to these positions is that the provisions of AB 2067 (Harmon), effective January 1, 2005 and not initiated at the time the responsewas prepared, allows for the consolidation of districts not formed under the same principal act. In such a circumstance, the election requirements would depend upon levels- of protest. This is a new circumstance since the survey response has been drafted by the District. In addition, the question of consolidation has not been. addressed specifically to these customer entities and a part of the staffs recommendation is intended to remedy that question through a continuance. In addition, staff would indicate that if the SBVWCD is charged with the responsibility to recharge and assist in the maintenance of the Bunker Hill Basin, then absent a consolidation, its sphere of influence should encompass the whole of that Basin, not just the eastern end. The electorate charged with selecting the governing body should represent the whole of the Basin rather than the limited territory at its eastern extreme. This question has not been addressed by LAFCO staff with the SBVWCD, the other agencies overlaying the area with ability to provide this service, or with the customer entities of the water retailers, cities, and water producers within the area. In regard to that circumstance, staff is recommending that the Commission continue this matter to the May 18th hearing, with the direction to staff to seek the response from these agencies regarding: (a) their position on a possible consolidation with either the County Flood Control District or San Bernardino Valley Municipal Water District, and (b) what would their position be to the expansion of the District's sphere of influence to include the area identified by engineers as the `Bunker Hill Basin'. ce LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 5. Local Accountability and Governance: The District is governed by a seven (7) member Board elected from within Divisions. The District conducts its business at regularly scheduled monthly meetings of the Board of Directors at its administrative facilities open to the public. In addition, the District conducts monthly meetings of its three standing committees, Resources, Administration, and Outreach, composed of three members of the Board of Directors. Since the District does not provide a service, per se, to a specific customer, it has limited feedback or participation with its electorate. However, the materials provided indicate that the District does have feedback with the water purveyors or those extracting water from within its boundaries regarding its operations through its mandatory annual Engineering Assessment required for imposition of its groundwater charge, currently set at $6.05 per acre foot for non-agricultural water and $1.65 per acre foot for agricultural water, and through its participation on various committees and task forces. The seven members of the Board of Directors are elected to four-year fixed terms and must be a registered voter within the boundaries of their respective divisions. While there is a requirement for an election in odd - numbered years, the following provides an outline of the elections actually conducted by the District during the last twenty years: Division #1 (Redlands) 1983 and 1999 Division #5 (Menton) 1989 Division #6 (North San Bernardino) 1993, 1997, 2001 No election has been held for Divisions 2, 3, 4, and 7 in the past twenty years according to the records of the Registrar of Voters. These divisions would . have been appointed in -lieu of election with application papers filen by a single candidate. 6. When Special Districts were seated on the San Bernardino LAFCO in 1976, a listing of services and functions was prepared, as required by law, acknowledging the services actively provided by the special districts at that time. This document is identified in the Commission's Policy and Procedure Manual, Section V — Special Districts as "Exhibit A — Listing of Special Districts Functions and Services". According to this document, the SBVWCD is currently authorized the active function and service as follows: 11 I.AFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 Latent powers are those powers authorized to a special district through its principal act, but which are not being actively provided. According to the SBVWCD's principal act, the Water Conservation District Law (Water Code Sections 74000 to 76501), the latent powers of the District on the basis of the definition above would be: FUNCTION SERVICE Surveys of Water Supply and Resources Make surveys and investigations of the water supply and resources of the Water Conservation District Flood or Overflow Control Provide for the construction, operation, and maintenance of such works, facilities and operations within or outside the District's boundaries to protect the land Surveys of Water Supply and Resources or property in the District from damage by flood or overflow Water May sell, deliver, distribute or otherwise dispose of any water.that may be stored or appropriated, owned or controlled by 'the District Park and Recreation Acquire, construct, maintain and operate recreational facilities in connection with any dams, reservoirs, or other works owned or controlled by the District It is unclear what was intended by the definition of the function and service as "water conservation" as the definition in Water Conservation Law provides specific language in this regard. It will be staffs recommendation that the Commission update this designation to more clearly outline the function and service authorized the District. Staff would suggest, based upon the materials provided, that the District's function and services be updated as follows: FUNCTION SERVICE Water Conservation Appropriation, acquisition, and conservation of water and water rights for any useful purpose. Acquisition and construction of dams, reservoirs, canals, conduits, spreading basins and sinking basins in order to conserve, store, spread and sink water Surveys of Water Supply and Resources Make surveys and investigations of the water supply and resources of the Water Conservation District 12 LAFCO 2919 - Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 In summary, the District has indicated that it performs a much-needed service, working in conjunction with the water retailers and wholesaler within the area to assure a safe and sufficient water supply. It is noted that at the time the report was prepared, none of the adjacent or overlaying agencies had identified any concerns with the existing sphere of influence for the SBVWCD; however, their notice of this consideration has been limited. To date, no concern has been expressed from the water producers associated with the District's sphere of influence who indicated their opposition to the District's annexation twelve years ago; however, they too have had limited information regarding this consideration. SPHERE OF INFLUENCE UPDATE: Pursuant to the requirements of Government Code Section 56425, every sphere of influence review is required to consider four factors of consideration. Due to the regional nature of this District and the limitations of the District's boundary and sphere within the defined Bunker Hill Basin, a response to these factors is difficult to provide. However, a summary response follows based upon the existing area of the District and its sphere of influence: 1. ' The present and planned land uses in the area, including agricultural and open -space lands: The present and planned land uses in the area comprising the area of the SBVWCD represent varying levels and intensities of urban development within unincorporated County areas as well as portions of the Cities of Colton, San Bernardino, Highland, Loma Linda;. Redlands, and Yucaipa. The SBVWCD comprises approximately 50,000 acres (78+ square miles) within San Bernardino County. 2. The present and probable need for public facilities and services in the area: The present and probable need for the services provided by the District to sustain the Bunker Hill Basin will continue and expand as the population of this portion of the Valley grows. However, the relationship of this entity's boundaries to the Bunker Hill Basin it is charged with providing water conservation and recharge efforts is of concern to LAFCO staff. The entire area of this basin is experiencing drought conditions, water contamination, and growth of the use of the groundwater supply. Water conservation is a need within the entirety of the basin, not just the eastern portion as defined by the boundaries of the SBVWCD. 13 IAFCO 2919 - Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 3. The present capacity of public facilities and adequacy of public services that the agency to be expanded provides or is authorized to provide: Within its current boundaries, the District provides its services of water conservation through recharge of surface water and/or State Project water during drought conditions in performance of its legislatively prescribed powers and responsibilities. 4. The existence of any social or economic communities of interest in the area. Due to the regional nature of this agency, it is difficult to address this issue. However, as noted in the materials and the mission statement of the District, its efforts are to maintain an adequate water level in the Bunker Hill Basin. The Bunker Hill Basin is much larger than the boundaries and/or sphere of influence of the District and could be considered a single community of interest. If the District's recharge efforts support this Basin, then staff would question the definition of the sphere — either it should be expanded to include the whole of this Basing or the possibility of consolidation with a district with responsibility for this larger area should be considered. CONCLUSION: At this time; the primary staff recommendation is that the Commission continues this consideration to the May 18, 2005 hearing and direct staff to compile responses to the questions regarding the District's expenditures, revenues, agency positions on consolidations and agency positions on the possibility of expanding the District's sphere of influence to include the whole of the Bunker Hill Basin. As outlined in the staff report, this is based on a number of questions that the materials have raised but staff has not has sufficient to time to address. However, if the Commission believes that sufficient information has been provided by the District, it can take the actions to approve the service review/sphere of influence update for the District affirming its existing sphere of influence designation and direct staff to return at the April 20, 2005 hearing with the resolution of approval for adoption on the consent calendar. Attachments: 1. Maps of the District's boundaries, its Regional Location, and its Relationship to Cities, San Bernardino Valley Municipal Water District, and County Water Districts 2. Outline of a Water Conservation District Prepared by LAFCO Staff LAFCO 2919 — Service Review/Sphere Update San Bernardino Valley Water Conservation District March 7, 2005 3. Staff Report for LAFCO 2751, dated December 3, 1993 4. Survey Response Provided by the District Including the Appendix Materials Identified in the Staff Report 5. District Budget for 2004-2005, Budget for 2003-04 and Audit Report for 2003- 2004 6. Response from Tom Dodson, Tom Dodson and Associates, LAFCO Environmental Consultant, Identifying Determination for Maintaining Existing Sphere of Influence Boundaries 15 h�A-.00 CONSERVAr/Ory O/SPIP i O414ftE Is OUR M1S`'�Ot, June 20, 2005 SAN BERNARDINO VALLEY WATER CONSERVATION DISTRICT 1630 West Redlands Boulevard, Suite A Redlands, CA 923738032 (909) 7932503 Fax (909) 793-0188 Mr. Robert E. Martin, General Manager East Valley Water District 3654 E. Highland Avenue, Suite 18 Highland, California 92346-2607 Dear Mr. Martin: Established 1932 P.O. Bar 1839 Redlands, CA 92373-0581 Email: info@sbvwcd.dst.ca.us www.sbvwcd.dst.ca.us In 2003, the San Bernardino Valley Water Conservation District (Conservation District) submitted its Municipal Service Review (MSR) to the Local Agency Formation Commission (LAFCO) for review. At the March 16, 2005 Commission hearing, the Conservation District's MSR and sphere of influence update was heard. At this hearing, the Commission directed LAFCO staff to return with additional information related to a number of questions. As part of gathering information, Ms. Kathleen Rollings-McDonald attended the Upper Santa Ana Water Resources Association meeting on June 9, 2005 to present the Conservation District's MSR and encouraged each agency to provide comments, in written form, to the Commission by August 1, 2005, on the following question(s); should the Conservation District consider consolidation with the San Bernardino County Flood Control District or San Bernardino Valley Municipal Water, District, or expansion of the Conservation District's sphere of influence to encompass the entirety of the Bunker Hill Basin? The Conservation District has prepared a written response and position on the above questions and provided additional information and clarification as requested. The attached document includes the Conservation Districfs Resolution No. 409 and responses to questions from the LAFCO staff. The responses were addressed on a question -by -question basis (hardcopy attached). Additionally, there are seven appendices, which provide additional information for particular items (CD attached). It should be noted that both of these items, the Resolution and the responses, were adopted by a roll call vote of the Board of Directors of the Conservation District at a special Board meeting on June 15, 2005. A new Commission hearing has been scheduled for August 17, 2005. If you need additional information or clarification, please contact me at (909) 793-2503. Sincerely, dl�6� Lawrence M.Libeu General Manager Enclosures BOARD Richard W. Corneille Arnold L Wright Cheryl A. Tubbs GENERAL Lawrence M. Libeu OF Clate Henry Day Glenda Douglas Melody Henriques -McDonald MANAGER DIRECTORS Manuel Aranda,)r. SAN BERNARDINO VALLEY WATER CONSERVATION DISTRICT MUNICIPAL SERVICE REVIEW Request For Additional Information LAFCO June 17, 2005 ER OVERVATION VR NAME IS OUR Miss Prepared By: San Bernardino Valley Water Conservation District 1630 W. Redlands, Blvd., Suite A Redlands, CA 92373 Phone: 909.793.2503 Fax: 909.793.0188 www.sbvwcd.dst.ca.us June 17,2005 SAN BER,NARDINO VALLEY WATER CONSERVATION DISTRICT 1630 West Redlands Boulevard, Suite A Redlands, CA 92373.8032 (909) 793.2503 Fax: (909) 793-0188 Ms. Kathleen Rollings-McDonald Local Agency Formation Commission 175 West Fifth Street, Second Floor San Bernardino, CA 92415-0490 Dear Ms. Rollings-McDonald: 1932 P.O. Box 1839 Redlands, CA 92373-0581 Email: info@sbvwcd.dst.ca.us www.sbvwoJ.dSLCa.US We are writing in response to your request for additional information and clarification as a result of questions from the Local Agency Formation Commission (LAFCO) Commissioners and your staff, of several items in the Conservation District's Municipal Service Review. We appreciate the opportunity to better inform the Commission prior to their August 17, 2005 meeting. The attached documents include the Conservation District's Resolution No. 409 and responses to questions from the LAFCO staff report. The responses were addressed on a question -by -question basis. Additionally, there are seven appendices, which provide additional information for particular items. It should be noted that both of these items, the Resolution and the responses, were adopted by a roll call vote of the Board of Directors of the Water Conservation District at a special Board meeting held Wednesday, June 15, 2005. It is our hope that this new information will assist the Commission in their decision-making process. If you require further information or clarification, please contact me at (909) 793-2503. Sincerely, dawren . Lib General Manager ENCL - 3 Complete Sets (All hard copies - no CDs) -10 Partial Sets (Hard copy responses - Appendices on CD ) BOARD Richard W. Corneille Arnold L Wright Cheryl A. Tubbs GENERAL lawrence M. 1-ibeu OF Clare Henry Day Glenda Douglas Melody Hcnriques-McDonald MANAGER DIRECTORS Manuel Aranda. Ir. ' wa.wu..�a Table of Contents Response to Question la Response to Question Response to Question lc Response to Question Response to Question le Response to question 11 Response to Question 2 Response to Question 3 Response to Question 4 Response to Question 5 Response to Question 6 Response to Question 7 Appendix A - SBVWCD Audit Re Appendix B - Last Three Fiscal Y Appendix C - Board of Directors l Appendix D - Materials for Estab] Charge Appendix E - Owners of Water Pi Roster of the USAIA Appendix F - Adopted Resolution Appendix G - Water Facts SBV Water Conservation District i , June 30, 2003 Income and Expenditures y Manual ig Upcoming Year's Groundwater cinE Facilities and 409 Response to LAFCO ..1 2 3 .5 .7 .9 10 11 14 15 17 19 y„Y[YP... An, A la. Provide a copy of the District's requested during application p: date. Attached, as Appendix A, is a copy of the San (Conservation District) 2003 Audit Report. References Appendix A — SBV WCD Audit Audit report — the document was ing but has not been received to Valley Water Conservation District June 30, 2003 SBV Water Conservation District 1 Response to LAFCO �+I`V wwry+nYl� ~IYIYI II OYI Y\�� lb. An explanation of the District's expenditures for the current and past two fiscal years related to water spreading activities, including, but not limited to, purchase of state project water and the agreed upon repayment schedule. The Conservation District has historically diverted water from the Santa Ana River and Mill Creek for groundwater recharge. Expenses related to these recharge activities generally include capital expenses, field operations, vehicle operations, general administration, benefits, salaries, utilities, insurance, and professional services. Water purchases, such as indicated below, are an irregular cost. During the most recent drought, the Conservation District partnered with several other local water agencies to purchase for recharge State Water Project (SWP) water from San Bernardino Valley Municipal Water District. This collaborative effort to maintain groundwater levels in the basin cost the Conservation District $305,823 in Fiscal Year 02/03 and $151,647 in Fiscal Year 03/04. This water was purchased from the Conservation District's cash reserves, and no repayment is anticipated. In Fiscal Year 03/04 the Conservation District purchased from San Bernardino Valley Municipal Water District $414,400 worth of SWP water to be used for groundwater recharge in the Bunker Hill basin. As agencies call on this water they reimburse the Conservation District for the cost of its purchase. Of the total amount purchased, $111,533 has been called for and recharged to date. For more detailed information on the revenues and expenditures for the current and past two fiscal years, see Appendix B. References Appendix B - FY 2002/2003 Income and Expenditures FY 2003/2004 Income and Expenditures FY 2004/2005 Income and Expenditures SBV Water Conservation District 2 Response to LAFCO +�yw wnnvdlev� lc. An outline of existing District policies related to expenditures for the Board of Directors, including, but not limited to, payment for attendance at meetings, conferences, travel costs, etc. Please provide an outline of the District's expenditures for the current and past two fiscal years related to payments to the Board of Directors. The Conservation District has a written policy governing payment to, and reimbursement of expenses incurred by, its Board of Directors (Board). The Policy Manual, attached as Appendix C, describes the policies set by the Board of Directors of the Conservation District for the conduct of the business of the Board. This Policy Manual sets out administrative policies governing the conduct of the Board's affairs, and the manner in which Conservation District business is to be conducted by members of the Board of Directors. It is the policy of the Conservation District to encourage Directors to participate in professional organizations; local, state, and national training and educational seminars; and meetings of other local organizations where such attendance would have applicability to the functions of the Conservation District. The Conservation District benefits from such activities both by keeping abreast of the latest developments and issues in the field of water conservation and groundwater management, and by the expanded professional communications that occur at such events. These benefits must be balanced, however, by budgetary limitations and an effort to avoid unnecessary duplication of representation of the Conservation District. Directors receive compensation for each meeting attended up to the maximumallowable under the California Water Code (10 per month). The amount of compensation is established by a resolution of the Board; except however, as permitted by the California Water Code, the Board may elect to receive an automatic 5% increase annually without further action by the Board. The current meeting compensation amount is $162. Expenses eligible for reimbursement are limited to (1) registration or tuition costs, or other charges for participation in the event; (2) transportation to and from the event, including airfare, car rental, or mileage for use of Director's own automobile, and other miscellaneous transportation costs (shuttle, taxi, etc.); (3) lodging at the single -room rate; and (4) reasonable costs of meals. To receive compensation for attendance at approved meetings, a Director submits a request for reimbursement to the General Manager not later than thirty (30) days after the meeting, or by the next regular Board meeting. The following table indicates reimbursements of fees and expenses made to the Directors during the current and past two fiscal years. References Appendix C - Board of Directors Policy Manual SBV Water Conservation District 3 Response to LAFCO .a„n<oun\yney� Oy a �y y�WYOYt M\pa DIRECTOR'S COMPENSATION BY FISCAL YEAR Total Operating FY 02/03 FY 03/04 FY 04/05* Director's Fees $55,237.00 $55,953.40 $50,236.00 Mileage $1,101.86 $1,230.62 $1,110.72 Air Fare $4,018.42 $5,439.40 $5,360.20 Lodging $9,065.69 $8,011.43 $10,742.74 Meals $3,083.95 $4,264.60 $3,660.23 Conf/Sem Reg $6,140.17 $6,210.00 $9,645.00 Other Travel $1,467.37 $3,543.09 $1,886.56 TOTAL $80,114.46 $84,652.54 $82,641.45 Total Operating Expenditures $1,512,880.35 $1,983,978.11 $1,352,629.31 % Director Compensation to Operating Expenditures 5.30% 4.27% 6.11% y through May 31, 2005 SBV Water Conservation District 4 Response to LAFCO Id. An explanation of the District's revenues for the current and past two fiscal years related to the groundwater assessment charge. Included in the materials please provide a description of the restricted use of these revenues, if any, how the expenditures are separated by the District from its other activities, and the process by which the charge is established each year. Please provide copies of the materials for establishing the upcoming year's charges. The Conservation District assesses a groundwater replenishment charge on every acre-foot of water pumped from within the Conservation District's boundaries. By statute, a different rate is applied depending on the use to which the water is applied: agricultural versus non-agricultural use. Water Code Section 75594 requires that non-agricultural rates must be not less than three times, and not more than five times, the agricultural rate. The rates enacted, and revenue collected for this and the past two fiscal years, is shown in the table below. Fiscal Year Ag Rate Non -Ag Rate Revenue 04/05 $1.65 $6.05 $493,906 03/04 $1.50 $5.50 $603,632 02/03 $1.50 $5.50 $414,448 For its own internal purposes, and for use when setting the Groundwater Replenishment charge, the Conservation District separates its expenses and revenues into categories: General Fund and Groundwater Replenishment. All activities that are related to, or support, groundwater recharge activities are assessed to the Groundwater Replenishment account. All other expenses and revenues are put under the General Fund account. The revenues associated with the Groundwater Replenishment account are not restricted, but are used for the groundwater recharge activities. Over the last three years the Groundwater Replenishment expenses have exceeded the revenues. For more detailed information on the revenues and expenditures for the last three years, see Appendix B. Adoption of the Groundwater Replenishment charge is governed by the Water Code, which requires the charge be adopted in the month of April following a public meeting and public hearing. Each year the Conservation District prepares and submits to the Board Secretary, at the regular March Board meeting, an Engineering Investigation Report providing the status of the Bunker Hill Groundwater Basin and predicting changes to the basin. At this meeting Conservation District staff recommends continuing or changing the Groundwater Replenishment charge based on existing and anticipated revenues and expenses. The Board of Directors authorizes staff to prepare a joint notice of a public meeting and public hearing and intent to adopt a Groundwater Replenishment charge. This joint notice is published in a newspaper of general circulation 45 days prior to the public hearing to adopt the charge, appearing once a week for 3 consecutive weeks. In addition, the public notice and Engineering Investigation SBV Water Conservation District 5 Response to LAFCO S 4; �O"+ra�c s auc �ac`O Report are posted on the Conservation District's website, and a letter advising of the joint notice information is sent to all groundwater producers within the Conservation District's boundaries. The Board of Directors holds a public meeting at their regular scheduled meeting in April, and conducts a public hearing at the end of April. Conservation District staff presents the Engineering Investigation Report, presents the Groundwater Replenishment Program, and receives comments at a public meeting of the Upper Santa Ana Water Resources Association. Appendix D provides copies of the materials used in establishing charges for the next fiscal year. References Appendix B - FY 2002/2003 Income and Expenditures FY 2003/2004 Income and Expenditures FY 2004/2005 Income and Expenditures Appendix D - Executive Summary of the Engineering Investigation, 2004-2005 Staff Report, March 2, 2005, Accepting Engineering Investigation Report Notice of Public Hearing Sample Letters to Producers (2) Staff Report, April 6, 2005, Public Meeting Relatcd to Adoption of Groundwater Charge Staff Report, Public Hearing to Receive Comments and Testimony Regarding Proposed Groundwater Charge for Fiscal Year 2005-2006 Staff Report, April 27, 2005, Adoption of Resolution No. 407 Establishing a Groundwater Charge on the Production of Groundwater Within District Boundaries and Making Certain Findings Relative Thereto for Fiscal Year 2005-2006 Resolution No. 407 Notice of Exemption SBV Water Conservation District 6 Response to LAFCO ++�,„wmlwnYY IYI M.YI II OYI le. An explanation of the District's revenues for the current and past two fiscal years related to the revenues from mining leases or other mining - related income. Included in the materials please provide a description of any restrictions on the use of these revenues, how expenditures are separated by the District from its other activities, the lease rate policy for current and future mining leases on District lands including any annual inflationary factor, etc. The Conservation District has lease agreements with three mine operators, Cemex, Robertson's Ready Mix (Robertson's), and Redlands Aggregate. The revenue received under these leases is unrestricted. Mining -related expenditures, and expenditures of mining -related revenues, are not separated by the Conservation District from its other activities. The terms of each lease are negotiated at the time of the lease. Other than these lease -specific terms, the Conservation District has no specific lease rate policy for current and future mining leases. Typical lease terms do, however, have some provision for adjusting the revenue based on fair market value of the material mined. Specific aspects of each lease are summarized in the following paragraphs, and revenues for the current and past two fiscal years included in the table below. Cemex Rate Structure The Cemex lease provides for royalty payments on each ton of material mined from the site. The current royalty rate is $0.35/ton. Beginning June 1, 2006 this rate rises to $0.45/ton. On June 1, 2016 the royalty rate becomes the Fair Market Value Royalty Rate, provided that this rate will be at least $0.35/ton. This lease also provides additional payments, in the form of Minimum Rental (currently $14,000 per year), and for processing of materials mined outside of the lease area ($0.05/ton). Cemex has the option to extend the lease in five-year increments, in its current form, to June 1, 2046. Redlands Aggregate Rate Structure The Redlands Aggregate lease requires that 5% of the sale price of each ton of material sold is paid in royalty to the Conservation District. The leaseholder is required to pay a minimum of $36,000 per year in royalty payments regardless of the actual amount of material sold. This lease may be extended in five-year increments, with its current terms, out to December 20, 2019, and extended with renegotiated terms out to December 20, 2044. Robertson's Ready Mix Rate Structure Robertson's has prepaid $5 million in anticipation of mining the first 12 million tons from the Lease Area. Thereafter, Robertson's will pay to the Conservation District the Fair Market Value SBV Water Conservation District 7 Response to LAFCO +p,awmauy„V*Q% J� ��adau Wa W� Royalty Rate for each ton excavated, provided that the rate will begin at a minimum of $0.50 per ton and a maximum of $0.55 per ton. This rate shall be revised every five years to be consistent with changes in the consumer price index. The lease term begins on a date determined by permits to be issued under the Wash Plan, which date is expected to occur some time in 2006. From that date, the lease term extends ten years, with Robertson's having the option to extend the lease in five-year increments, in its current form, for another twenty years. REVENUES RECEIVED FROM MINING, BY FISCAL YEAR SOURCE FY 04/05 FY 03/04 FY 02/03 Cemex $754,747.55 $863,748.72 $702,637.33 Redlands Aggregate $30,000.00 $33,000.00 $54,000.00 obertson's $0.00 $0.00 $0.00 TOTAL $784,747.55 $896,748.72 $756,637.33 SBV Water Conservation District 8 Response to LAFCO % 1f. An explanation of the $5,000,000 pre -payment of mining leases, including, but not limited to, an identification of the source of the revenue, the terms of the payment, the adjustment for lease increases upon actual lease signing, etc. The Conservation District received in October 1992 from Robertson's Ready Mix a $5,000,000 pre -payment of royalties for the first twelve million (12,000,000) tons of material to be excavated under the lease. Permits from other state and local agencies for mining the lease area have not been obtained by Robertson's. The Upper Santa Ana River Wash Land Management and Habitat Conservation Plan (Wash Plan) is a multi -agency planning effort seeking to harmonize competing land uses in the Santa Ana River wash. As part of this plan, the existing lease area will be exchanged for other property in the wash, and permits will be sought for mining on the exchanged property. The Lease provides that if Robertson's is unable to secure mining permits for the lease area within a defined period, the Conservation District shall refund the pre -paid royalty, without interest. Because of this potential refund obligation, the Conservation District has voluntarily restricted use of the principal funds until such obligation is removed. SBV Water Conservation District 9 Response to LAFCO +ppwnap,br�t 2. A listing of the water producers within the District's boundaries so that a meeting notice can be provided to discuss the issues of a possible sphere of influence expansion or consolidation proposal. As discussed in our meeting of May 11, 2005, this meeting can be accommodated through discussion at the Upper Santa Ana River Association meeting, held on the second Thursday of the month, if the major producers for agricultural and non-agricultural water within the District can attend. A meeting of the Upper Santa Ana Water Resources Association (USAWRA) was held on June 9, 2005. At Ms. Rollings-McDonald's request, she was placed on the agenda to discuss the Conservation District's Municipal Service Review (MSR). Attached in Appendix E is a list of names and addresses of owners of water producing facilities within the Conservation District boundaries. These owners receive a reporting form every six months for the purpose of quantifying the water produced from their respective facilities and payment of their groundwater charge. Also attached is the USAWRA membership list. References Appendix E - Owners of Water Producing Facilities Within Conservation District Boundaries Member Roster of the Upper Santa Ana Water Resources Association SBV Water Conservation District 10 Response to LAFCO d �c+ab d eo. 3. The official position of the District regarding a potential consolidation with either San Bernardino Valley Municipal Water District or San Bernardino County Flood Control District, or the expansion of the District's sphere of influence to encompass the entirety of the Bunker Hill Basin. The Conservation District does not favor consolidation with the San Bernardino County Flood Control District. While the San Bernardino County Flood Control District may have statutory authority to conduct certain water conservation activities, just as Water Code Section 74524 gives the Conservation District power to conduct flood control activities, practical inconsistencies between the fulfillment of water conservation and flood control objectives have led to these functions being best performed by different entities. Effective flood control requires the movement of the greatest quantities of water out of the watershed in the least amount of time, leaving facilities available to handle any subsequent storm events. Water conservation requires the detention of the maximum amount of flows practicable, and their retention in facilities long enough to allow for percolation into the groundwater basin. Consolidation of these two functions in a single agency would, the Conservation District believes, inevitably lead to a compromise in the effectiveness of either or both of these competing interests. Both are of critical importance, and neither should suffer in priority. The Conservation District does not favor consolidation with the San Bernardino Valley Municipal Water District. The Conservation District was formed in 1932, to conserve water for the Bunker Hill Basin. The San Bernardino Valley Municipal Water District was formed in 1954, primarily to serve as the agent for importation of State Project Water into the San Bernardino Valley. Again, while the agencies have certain overlapping powers under their organic statutes, the Conservation District believes those it serves will best be served by an agency whose commitment to groundwater maintenance and enhancement in the Bunker Hill Basin is its paramount mission, for the following reasons: (a) The Conservation District has significantly more experience with groundwater recharge within its boundaries. It has conducted its water spreading operations for over 70 years, during times of drought and flood. It has compiled both data and field experience with its facilities, and their response to changing river conditions, in order to maximize effective recharge of the native water resources for the groundwater basin. No other agency, including San Bernardino Valley Municipal Water District, has this history or extent of experience. (b) The Conservation District has no potentially conflicting interests or responsibilities which might result in the priority of application of high quality native water flows being shifted to other uses, including potential export outside of the San Bernardino Valley. The history of water management in the San Bernardino Basin reflects the priority water users have accorded to the Conservation District's role as an advocate for the basin generally, as reflected in its role on the Big Bear Watermaster and as the Project Manager under the Santa Ana River -Mill Creek Cooperative Water Project. The Conservation District believes its established SBV Water Conservation District 11 Response to LAFCO role in this regard, free of potentially parochial concerns on water usage or exchange, or commitments to parties outside the basin, does and will continue to best serve the interests of the Bunker Hill Basin and its users. (c) The Conservation District fulfills its mission with low-cost, environmentally unobtrusive infrastructure, consisting primarily of unlined canals, berms, and dikes made of natural material, and open spreading basins. Consolidation of these facilities with the more intensive infrastructure needed for San Bernardino Valley Municipal Water District to fulfill its responsibility of importing and exporting water, and other duties, may result in expanded capital expenditures and their attendant environmental impacts in environmentally sensitive areas. (d) The Conservation District has an established and accepted financing mechanism to assist its water conservation efforts, in its groundwater charge. This charge is specifically authorized by Water Code section 75500 of the Water Code, and has been implemented by the Conservation District, without challenge, since the mid- 1990s. San Bernardino Valley Municipal Water District's organic statute contains no parallel revenue source, and consolidation may present a threat to this important source for funding groundwater recharge activities in the Bunker Hill Basin. The Conservation District does not favor expansion of its sphere of influence to encompass the entire Bunker Hill Basin. The Conservation District is aware its boundaries do not'reach the entirety of the Bunker Hill Basin, and understands the logic of having a single set of guiding management policies for all portions of the basin. Nevertheless, the Conservation District believes the best manner of establishing those policies is through the multi -agency collaborative efforts already well underway by basin stakeholders, rather than designating a single agency to dictate policy. The Upper Santa Ana Water Resources Association has formed a Basin Management Committee for this purpose, in which the Conservation District is an active participant. Numerous agencies are involved in the recharge and use of Bunker Hill Basin waters, many of which are outside the Conservation District's boundaries. These Basin users have entered into an Integrated Management Program Demonstration Project Agreement to test various parameters of cooperative basin management, and negotiations accompanying the water rights applications pending before the State Water Resources Control Board have led to constructive progress on proposals for groundwater recharge parameters and basin management criteria. The Conservation District believes these efforts offer the best and quickest path to long- term effective basin management, and will not be aided, indeed may be hindered, by LAFCO expanding the Conservation District's sphere of influence to include the full basin. In addition, the Conservation District has no facilities in the portions of the basin now outside its boundaries. Expansion of the Conservation District's Sphere of Influence would be duplicative of other agencies' facilities and services. Attached as Appendix F is a copy of the adopted Resolution No. 409, communicating the Conservation District's opposition to consolidation with San Bernardino County Flood Control District or San Bernardino Valley Municipal Water District, and opposing expansion of the Conservation District's sphere of influence to include the entirety of the Bunker Hill basin. SBV Water Conservation District 12 Response to LAFCO .'www�wuno,�y�P1;, JtMnun n ouu References Appendix F - Adopted Resolution No. 409 SBV Water Conservation District 13 Response to LAFCO +,V cYnullYonyl � rel �YIYI II WIY� 4. A copy of the Regional Water Management Plan or Integrated Groundwater Management Plan adopted by the District and/or the Watermaster for the basin. Presently, neither such document exists. The Conservation District currently operates its facilities under the "Operational Management Manual," dated March 1994. As part of the Water Rights application on the Santa Ana River, the Conservation District has prepared a draft "Program for Effective Recharge Coordination" (FERC) to better assist the Conservation District in its operations. The PERC provides guidelines and procedures for the determination of annual water recharge/operational practices conducted by the Conservation District, to ensure it continues to operate in an economic, efficient, and environmentally sound manner. The Conservation District has also joined in an effort to prepare an Integrated Regional Water Management Plan (IRWMP). A Regional Water Management Group (RWMG), comprised of the San Bernardino Valley Municipal Water District, Conservation District, City of San Bernardino, City of Redlands, City of Riverside, East Valley Water District, West Valley Water District, Yucaipa Valley Water District, and the Water Resources Institute at California State University San Bernardino, is developing this IRWMP. This group will facilitate meetings and coordinate preparation of the draft and final IRWMP. Members of the RWMG represent their respective agencies and provide status reports to their agency boards. The draft IRWMP will be presented to the governing boards of each agency for adoption, which adoption is scheduled for December of 2006. SBV Water Conservation District 14 Response to LAFCO �„awuu.a„ee .r S 4, �e"enueua+��� 5. An outline of the District's Water Rights application, including the costs for litigation, the status of the application at the present time, and the relationship to the San Bernardino Valley Municipal Water District/Western Municipal Water District application. June 1, 2001, the Conservation District submitted an Application to appropriate water by permit from the Santa Ana River and Mill Creek, and petitioned the State Water Resources Control Board (SWRCB) for an order revising the fully appropriated stream declaration for the Santa Ana River. The purpose of the Application is to protect the integrity of the Conservation District's historical practice of diverting surface waters in the Santa Ana River and its tributary, Mill Creek, which practices date back to approximately 1911. The Conservation District sees this as primarily a defensive measure, ensuring its historical rights and practices are not overlooked during the SWRCB's permitting of other uses of the Santa Ana River. The total amount of water proposed for diversion in this Application is 65,864 acre-feet. The Conservation District has spent approximately $1.02 million on the preparation and submittal of the Application, and on the preparation of supporting environmental documents. Below is a breakdown of the services provided by fiscal year. SERVICES PROVIDE IN SUPPORT OF THE CONSERVATION DISTRICT'S WATER RIGHTS APPLICATION Fiscal Year Legal Engineering Environmental Totfil 00/01 $19,084.58 $25,302.69 $0.00 $44,387.27 01/02 $31,293.82 $3,073.05 $0.00 $34,366.87 02/03 $54,599.08 $121,636.80 $144,011.13 $320,247.01 03/04 $86,285.17 $191,665.45 $169,919.69 $447,870.31 04/05 $113,517.03 $40,559.37 $18,837.08 $172,913.48 Total $304,779.68 $382,237.36 $332,767.90 $1,019,784.94 On July 2, 2002, the State Water Resources Control Board amended the fully appropriated stream declaration allowing and directing the Division of Water Rights to proceed with processing the Conservation District's and other specified applications. On May 20, 2003, the SWRCB noticed the pending applications. On June 27, 2003, the Conservation District released a Notice of Preparation of a Draft Environmental Impact Report (EIR) for the Conservation District's Santa Ana River and Mill Creek Water Rights Application and Groundwater Management Plan. On June 29, 2004 the Conservation District distributed the Draft EIR for public review and comment. The comment period closed on August 12, 2004. The Conservation District is in the process of meeting with commenting parties, and is seeking resolution of their concerns. The San Bernardino Valley Municipal Water District and Western Municipal Water District of Riverside County (Muni/Westem) have jointly filed two Applications to the SWRCB to appropriate water from the Santa Ana River. Their combined applications seek the right to divert SBV Water Conservation District 15 Response to LAFCO +',N .......Troy%s f+ y$ �nyny nouar� up to 200,000 acre-feet per year. Muni/Western has prepared a Draft EIR to evaluate the environmental impacts associated with the proposed diversion of water from the Santa Ana River. Their Draft EIR has been released for review and the comment period has been closed. The Conservation District's operations are devoted to maintaining and enhancing groundwater supplies in the Bunker Hill Groundwater Basin, over which its jurisdictional boundaries lie. The Conservation District provides no retail services, and has no commitments for water deliveries, whether within or without the watershed of origin of the flows it diverts. The Conservation District makes water available for producers and other purveyors, which include the municipalities of Redlands, Highland, Loma Linda, San Bernardino, Riverside, and Grand Terrace as well as agricultural and other users. Currently, the Conservation District and Muni/Westem are in negotiations to reach settlement regarding the water rights applications prior to the conduct of hearings by the State Water Resources Control Board. SBV Water Conservation District 16 Response to LAFCO f+o w w...Mft,A ! i X04. i. ow 6. An outline of the outreach efforts conducted by the District over the past three years to provide information to the registered voters and landowners within District boundaries regarding the authorities of the District and its programs. Over the last three years the Conservation District has focused its outreach in four areas: public; educational institutions; service and business communities; and the San Bernardino Basin Area stakeholders. As part of the Conservation District's efforts to reach out to the public, a new web site was launched in 2001. The web site provides information about the Conservation District, its mission and history, its Board of Directors, and the Conservation District boundaries. Also included is a list of current projects, meeting agendas and minutes, and noticing of other public documents. This website (www.sbvwcd.org) is updated regularly. The Conservation District has expanded its outreach to educational institutions over the last two years by engaging in school visits and offering tours of local water facilities to classrooms. The Conservation District staff spends time in the classroom discussing the hydrological cycle (water cycle), demonstrating how groundwater works by using a physical model, describing how groundwater level information is gathered using monitoring wells, and providing tours of the Conservation District recharge facilities. The Conservation District also sponsors and exhibits at the CSUSB Environmental Expo and participates in the CSUSB Water Resources Institute. The Conservation District is a member of the Loma Linda, Redlands, Highland, and San Bernardino Area Chambers of Commerce. In addition, staff and directors are local members of national service organizations. Staff prepares and presents at several monthly meetings describing the history and mission of the Conservation District, its recharge operations, and its groundwater -level monitoring program. The Conservation District also exhibits at the various chambers' Business and Community Fairs, at which staff is able to meet with the public and local businesses and answer any water -related questions. Attached in Appendix G are copies of the Conservation District fact sheets used at some of these events. San Bernardino Basin Area stakeholders are reached through the Conservation District's involvement in the local water community. For example, the Conservation District is a member of the Upper Santa Ana Water Resources Association (USAWRA), composed of member agencies located in the Upper Santa Ana watershed that share a common goal of managing the surface water and groundwater resources of the region. Through the Basin Management Committee of this organization the Conservation District is involved in the formation of an Integrated Water Resources Management Plan for the San Bernardino Basin Area. The Conservation District is also involved with several other multi -agency groups and projects: the Conservation District is the project manager for the Santa Ana River — Mill Creek Cooperative Water Project (Exchange Plan), an agreement amongst several water agencies for shared water exchanges and use of facilities; the Pilot Dewatering Project is a collaborative effort seeking to address potential high groundwater issues in the San Bernardino area; the FERC re- SBV Water Conservation District 17 Response to LAFCO YpamnurnoY°y? r �YIYI II WII Y6� licensing project examined streamflow issues related to Edison's hydroelectric facilities on Santa Ana River and Mill Creek; the TIN/IDS Task Force examined groundwater quality in the San Bernardino Basin Area; the Conservation District provided technical services to the various groundwater producers to fulfill their obligations under the Drinking Water Source Assessment Program; and the Conservation District is lead agency and project manager for the Upper Santa Ana River Land Management and Habitat Conservation Plan, seeking to balance resources in the Santa Ana River wash area. References Appendix G - Water Facts — San Bernardino Valley Water Conservation District SBV Water Conservation District 18 Response to LAFCO +uvwmwR„��� d� b �Y.YY Y OYR Y� 7. In response to your presentation at the March 16th hearing that the District would request activation of your flood control and park and recreation powers, please provide a description of the function and service anticipated to be provided if flood control and/or park and recreation services were to be activated, the financing mechanism to be used to provide the services, and any infrastructure or facility cost anticipated in order to actively provide the services. The Conservation District indicated at the March 16`h hearing that it does provide some flood control benefit by diverting storm flows from the Santa Ana River and Mill Creek to off -stream percolation basins. However, this flood control benefit is incidental to the Conservation District's normal operations, and not a focus of those operations. The Conservation District does currently engage in recreational activities, and expects this to continue in the future. Examples of existing activities include hosting a model airplane runway maintained by a local radio -controlled airplane club, and hosting the City of Highland's annual Trails Day. Future recreation activities are proposed in conjunction with the City of Highland and the City of Redlands as part of the Upper Santa Ana River Wash Land Management and Habitat Conservation Plan, and include trails and potential active recreation in post -reclamation mining quarries. Trails are maintained as part of the Conservation District's existing transportation network — unimproved access and maintenance roads. Future active recreation in post -reclamation mining quarries has been proposed by the cities, but is too premature to analyze funding sources at this time. SBV Water Conservation District 19 Response to LAFCD INTEROFFICE MEMORANDUM TO: ROBERT MARTIN, GENERAL MANAGER FROM: BRIAN TOMPKINS, CFO SUBJECT: SCT PREMIUM DATE: 6/22/2005 CC. As requested by Director Goodin, I contacted ACWA to inquire about the group discount on State Fund policies available to ACWA members. The ACWA web site shows that the discount is 6%, and this was confirmed by the ACWA representative I spoke with. The ACWA representative gave me a State Fund contact number, which I called. That person then directed me to have our broker contact State Fund to work up a quote. Keith Olmo at Sander Kessler was able to work up the attached quote for me in just a few minutes as they have several client who are insured by State Fund. As you can see, the State Fund premium would be about •$11,000 more than Crum & Forster. Keith explained that Crum & Forster is being very aggressive with their rates in order to keep good clients, such as East Valley, while State Fund is locked into the rates that are set for them This allowed Crum & Forster to be more competitive. I will be at a conference Monday through Wednesday. Hopefully I will have a third quote for the directors to consider and they will be comfortable with the choices they have this year. Board of Directors Mr. Brian W. Tompkins, CFO saaates,inc. insurance 2850 Ocean Park Boulevard e Suite 200 a Santa Monica e CA 90405 Telephone Number: (310) 309-2200 a FAX Number: (310) 309-2628 License No. 0313318 June 22, 2005 TABLE OF CONTENTS SANDER A. KESSLER SERVICE TEAM RESPONSIBILITIES 4 COVERAGE SUMMARY 5 EXPERIENCE MODIFICATION HISTORY 6 GUARANTEED COST PLAN 7 SCHEDULE OF SERVICES 11 MARKETING SUMMARY 12 CLIENT AUTHORIZATION TO BIND COVERAGE 13 The proposal is presented for coverages to be effective July 1, 2005, and is valid until July 1, 2005. Date Typed: June 22, 2005/wi 2 June 22, 2005 WORKERS' COMPENSATION MANAGEMENT TEAM EAST VALLEY WATER DISTRICT SANDER A. KESSLER & ASSOCIATES, INC. Kimaili DavisI I Keith Olmo I I Cindy Gutierrez Claims Specialist Vice President Senior Account Manager Laura Cervantes Account Manager INSURANCE COMPANY Loss ControlI I Representative Claims Management 3 June 22, 2005 SANDER A. KESSLER SERVICE TEAM RESPONSIBILITIES KESSLER Keith Olmo Sales Executive (310)309-2240 kolmo@sanderkessier.com Cindy Gutierrez Senior Account Manager (310) 309-2271 cgutierrez@sanderkessler.com Laura Cervantes Account Manager (310) 309-2248 Icervantes@sanderkessler.com Kimaili Davis Workers' Compensation Claims Specialist (310) 309-2214 kdavis@sanderkessler.com RESPONSIBILITIES • Liaisons between East Valley Water District and Insurance Company • Account Servicing • Conduit to Kessler Resources • Researcher/Problem Solver • Claims Status Information on current policy terms • Certificates • Billings • Loss Review • Reserve Analysis • Claims Administration • Claims Guidance & Support 4 June 22, 2005 Type of Policy: Policy Term: Territory. Limits: Endorsements: Named Insured. ;:. WORKERS' COMPENSATION:.` COVERAGE SUMMARY Workers' Compensation and Employers' Liability in the State of California July 1, 2005 to July 1, 2006 California, and Other States, except North Dakota, Ohio, Washington, West Virginia and Wyoming Workers' Compensation Statutory Employers' Liability Bodily Injury by Accident Bodily Injury by Disease Bodily Injury by Disease Included Officers: - Donald Goodin - George Wilson - Glenn Lightfoot - Kip Sturgeon - Edward S. Negrete 1) East Valley Water District Covered Locations: 1) 1155 Del Rosa Avenue San Bernardino, CA 92413 2) 4588 E. Highland Avenue San Bernardino, CA 92413 $1,000,000 Each Accident $1,000,000 Policy Limit $1,000,000 Each Employee 3) 3654 Highland Avenue, Suite #18 Highland, CA 92346 Important Sexual harassment Exclusions: Discrimination Wrongful Termination Punitive damages United States Longshoremen & Harbor Workers 5 June 22, 2005 EXPERIENCE MODIFICATION HISTORY 6/7/2004 - 3:08:17 PM Coovriaht n 2004 ComoBne. LLC Linda Pearson - KESSLER & ASSOCIATES EAST VALLEY WATER DISTRICT 05/21/04 C 2004 087 05/02/03 C 2003 103 1155 DEL ROSA AVE, SAN BERNARDINO, 92413 County: San Bernardino 04/12/02 C 2002 109 1155 DEL ROSA AVE, SAN BERNARDINO, CA 92410 County: San Bernardino 07/01/01 E 2001 087 Phone:()- Bureau #:0215823 Last Update: 05/21/04 07/01/01 E 2001 089 Add To MlodwatchT1° 07/01/00 E 2000 089 7520 I WATERWORKS 10.64 S 9"' 07/01/99 E 1999 096 8742 I OUTSIDE SALESPERSONS 1.50 U 1.1n07/01/99 E 1999 096 8810 I CLERICAL OFFICE EMPLOYEES 1.29 U 1.0. 9402 I STREET/SEWER CLEANING 7.76 C 6.6P/01/98 E 1998 116 06/05/98 C 1998 116 07/01/97 E 1997 096 EAST SAN BERNARDINO COUNTY WATER DISTRICT 03/28/97 C 1997 096 EAST VALLEY WATER DISTRICT (A CORP) 07/01/96 E 1996 120 EAST VALLEY WATER DISTRICT (DBA) 03/29/96 C 1996 120 NORTH FORK WATER COMPANY (DBA) - 07/01/95 E 1995 108 - - - - 05/12/95 C 1995 127 142 106/05/98 C 1994 092 130 F4 120 116 08/02/96 C 1994 092 118 '?'�;+ 10 ^+^"` 109 103 05/20/94 C 1994 093 106 4- 91 04/02/93 C 1993 073 � �gea. a , ;^.,y •.� ��, _ 67 �, � 87 04/17/92 C 1992 067 62 bo', 67 � a l 'A'`;1 - °:; •`r�; ;" � .t ,e ^.,, *(` ''x � �'•, ; 03/27/92 C 1992 066 70(" 03/29/91 C 1991 091 58 z . i 04/13/90 C 1990 137 48 05/19/89 C 1989 176 34 a d *_ 1 y a p. 05/06/88 C 1988 144 22 ° �-- -' 04/03/87 C 1987 107 "•° '"( �'"+ 10 05/16/86 C 1986 096 90 81 92 93, 94 95 98 97 98 99 2000 2001 2092 2003 2004 08/29/85 C 1985 101 09/28/84 C 1984 099 05/06/83 C 1983 112 03/04/82 C 1982 108 05/16/81 C 1981 116 03/04/80 C 1980 124 01/31/79 C 1979 157 01/31/78 C 1978 138 01/31/77 C 1977 150 01/01/76 C 1976 114 6 June 22, 2005 N RP P P P P RP RP RP RP GUARANTEED COST PLAN CRUM & FORSTER/U.S. FIRE INSURANCE COMPANY A.M. Best Rating: A- XII 2004 Base Rates 2004 Net Rates Code Class 2005 Payroll 2005 Manual Rates 2005 Net Rates $14.48 $12.07 7520 Water Districts $2,259,090 $ 11.38 $7.21 $ 9.76 $ 8.15 9402 Street Cleaning $ 114,121 $ 8.02 $5.09 $ 1.53 $ 1.30 8810 Clerical $ 749,680 $ 1.04 $0.91 $ 1.75 $ 1.49 8742 1 Salespersons - Outside $ 139,256 $ 1.54 $1.00 MANUAL PREMIUM $ 278,878 2005 EXPERIENCE MOD 70% <$ 83,663> SCHEDULE MODIFICATION -6% <$ 11,713> STANDARD PREMIUM $ 183,502 PREMIUM DISCOUNT -4.1% <$ 7,524> EXPENSE CONSTANT $ 250 TERRORISM 3% $ 979 TOTAL ESTIMATED ANNUAL PREMIUM $177,207 User Fund Assessment .4809% $ 852 Fraud Assessment .0005% $ 89 CIGA 2% $ 3,544 Uninsured Employers Benefit Trust Fund .0691% $ 122 Subsequent Injuries Benefit Trust Fund .0259% $ 46 TOTAL COST L.1 PAYMENT TERMS: 25% Deposit of $44,304 plus State Taxes & Fees of $4,653 totaling $48,957. Subject to Nine (9) Monthly Installments of $14,767. Please make check payable to Sander A. Kessler & Associates All cancellations are subject to short rate. 7 June 22, 2005 GUARANTEED COST PLAN AIG/Commece & Industry Insurance Company A.M. Best Rating: A+ XV 2004 Base Rates 2004 Net Rates Code Class 2005 Payroll 2005 Manual Rates 2005 Net Rates $14.48 $12.07 7520 Water Districts $2,259,090 $ 13.37 $8.58 $ 9.76 $ 8.15 9402 Street Cleaning $ 114,121 $ 9.41 $6.04 $ 1.53 $ 1.30 8810 Clerical $ 749,680 $ 1.65 $1.06 $ 1.75 $ 1.491 8742 1 Salespersons - Outside $ 139,256 $ 1.81 $ 4,208 MANUAL PREMIUM $ 327,670 2005 EXPERIENCE MOD 70% <$ 98,301> STANDARD PREMIUM $ 229.369 PREMIUM DISCOUNT -12.62% <$ 28,946> EXPENSE CONSTANT $ 160 TERRORISM 3% $ 9,830 TOTAL ESTIMATED ANNUAL PREMIUM .$210,413 User Fund Assessment .4809% $ 1,012 Fraud Assessment .0005% $ 105 CIGA 2% $ 4,208 Uninsured Employers Benefit Trust Fund .0691% $ 145 Subsequent Injuries Benefit Trust Fund .0259% $ 54 TOTAL COST LIL15,937 PAYMENT TERMS: Premium due and payable in full at inception. Please make check payable to Sander A. Kessler & Associates All cancellations are subject to short rate. June 22, 2005 132 (a) and Serious & Willful Misconduct Legal Expense Reimbursement Insurance California Employees Only Optional Coverage Limits per insured event and in aggregate: $100,000 Deductible per claim $ 1,000 Coinsurance: 100/0 Term One Year Premium $ 1,772 Policy Fee: $ 100 California State Surplus Fees: $ 57 (3.225%) Conditions: 1) Subject to review and approval of signed application, dated no greater than 45 days prior to the effective date 2) Excludes coverage for claims arising from any operations outside of California 3) Premium due and payable at inception 9 June 22, 2005 Compensation Disclosure Except in Cases where Sander A. Kessler & Associates has a specific fee agreement to receive compensation from its client, Sander A. Kessler & Associates customarily receives compensation from insurers for its professional services in the form of commissions, which consist of a percentage of the premium collected by the insurers. Sander A. Kessler & Associates may also receive additional compensation, under agreements with one or more insurers in the form of commission overrides or based on some combination of volume, profitability or other factors. Such agreements may be in effect with one or more of the insurers with whom your insurance is placed. At your request, Sander A. Kessler & Associates will be pleased to supply further details of any such fee, override or other compensation that relates to your account. 10 June 22, 2005 W) 0 0 N CV N N C MARKETING SUMMARY We presented your account to other carriers with the following results: Insurance Carrier Results State Compensation Insurance Fund Indication - $193,769 12 June 22, 2005 TO: Sander A. Kessler & Associates, Inc. RE: East Valley Water District Workers' Compensation After careful review of your proposal dated June 22, 2005, we have decided to accept your proposal as presented. M After careful review of your proposal dated June 22, 2005, we have decided to accept your proposal with the following changes: Please have a binder(s) issued and your invoice prepared for the agreed upon coverages at your earliest convenience. Client Signature Date 13 June 22, 2005 aaae■ � §| ( �\ -IL �!$E7 lcc as m§ ,j 888 ae § aaae■ � §| ( �!$E7 as m§ ,j 888 ae ! ®#R ` . |Ul ,aa■a ( (■&■ § � k k k 0LL -- A aa8 k BK§ CM g ■5§§ k !a` § � -- w tt§7 � �--- co a 7 U. @ ( as m§ ,j ,§ ae ## n ` . # ,aa■a ( (■&■ ke � k k k R■ 2§§§k x \ §�!% East Valley Water District Balance Sheet - Unaudited May 315 2005 ASSETS UTILITY PLANT- at cost Utility plant in service - water department $84,878,661 Utility plant in service - sewer department 22,276,277 Cash and Investments 107,154,939 Less: Accumulated depreciation (32,160,926) 74,994,012 Construction in progress 6,741,042 Land held for resale 1,864,686 83,599,741 RESTRICTED ASSETS: Water department - bond funds - cash in bank 6,475 Certificate of Participation reserved funds - cash in bank 10,980,037 Reserved funds - designations - cash in bank 2,186,450 t-]Bf7fsI el OTHER ASSETS AND DEFERRED COSTS (Net of Amortization): Bond discount and incidental bond expenses 17,998 Deferred financing charges 331,603 349,601 TOTAL ASSETS $106,160,172 13,172,962 CURRENTASSETS: Cash and Investments 19,823,619 Less: Restricted Cash and Investments 13,172,962 6,650,657 Accounts receivable (net of allowance) 1,064,729 Other receivables (net of allowance) 99,818 Inventory 934,281 Prepaid expenses 288,384 t-]Bf7fsI el OTHER ASSETS AND DEFERRED COSTS (Net of Amortization): Bond discount and incidental bond expenses 17,998 Deferred financing charges 331,603 349,601 TOTAL ASSETS $106,160,172 East Valley Water District Balance Sheet - Unaudited May 31, 2005 LIABILITIES AND EQUITY LONG-TERMDEBT. Certificates of Participation due after one year $10,938,177 Installment payment obligation 9,843,226 Less: Deferred amount on refunding of COPS (567,968) 20,213,435 CURRENT LIABILITIES: Accounts Payable 1,535,375 Accrued payroll and benefits 446,389 Customer service deposits 1,313,416 Deferred Rental Income 2,500 Accrued interest payable 6,475 Deposits - refundable 370,550 Certificates of Participation due within one year 1,726,266 5,400,971 TOTAL LIABILITIES 25,614,406 EOUm: Contributed capital: Invested in utility plant 29,028,411 Other contributed capital 3,695,064 Retained earnings: Reserved for water bond funds 6,475 Reserved for emergencies 2,170,000 Reserved for unemployment insurance 16,450 Unreserved 41,519,146 Net Income for current year 4,110,220 TOTAL EQUITY 80,545,766 TOTAL LIABILITIES AND EQUITY $106,160,172 8 co L6 v 7 O mNN SO�VV OtOt�� 000p0p00�mm �0�VV O � p� O'Q OO fO �mOtp 0(70m 00Oj (p� {{I�r+pn�� fh� .n-Nl+1N Nm�Wmmm O W O P7 C �Nr} 88 ppppb� NpNp (t(tip�pJ ��ppyyyp NN m T �m NI�OOmt_m r[YN�NNOfOn � T muni �m SN`�N�m�i''�onUni v �. r� rS NN fp�pmm T tON mf70 tOO. 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O Q �ma'.E WSJ E m Em Eo'`' W pNU��IL �i D OLL O O d¢ W(7 W W-� C ¢ Fb- 0 CR a a g��Q;ni5��bimao Vsj' 00 NoNgC� g a$ co m irioyi�+'�u�"cjcaEo$j��, a (ANN < c��ii i�33 ��SS ZAii tragi N p o0 0 0000 ON OOm f0 O N�[f0000 qp _ P N $ r ({�7 �{oP W O Oi tD pmW�NPO {ppb C N 83� N Om0 m W�NMN WNO W Of Or r N M r 7 CIA 8S�p} �{ 8 ^^ pW 8 " M •.•"_ Y�(1](��n Rm N OON N O ��NCY.n- aWO�OIO O n (�N� O W4W O0WD W COY CIN WN�NNNm O�l 'Cr N O CYN W m0 f� Q �^ '.- N v V Lo COv`p�i iOn g 809iS W W W N d �o�nNa O1 OOCO�CvN �Y,tl v W $8 88 p § HU M C t ;m $ r.'. 9 $ W.T-h NNN a � V >=cg c W N W W V ozv� N tW0 mm n W InNO W 1or� d _ 0 W W N 00 W'OIVNO�N N r (W� G V � LL Q r a c c v a ro m,2 Em > � m H c y W pc m �O 011 " m CN �W =� X OE 11. G U 0 d Cr 0 m W6 LZU W Z Emm 16 16 ccU m a cF�`m 9. c� �O B F 00 E,2 o o a a t m C m m a m m 3m m U'm E. Z W Q ccmiw �W _Eiaao rn acn12 e t �y U g m cc Nr�N 002 � rnm•o a0mm� LL x O W?LD�o Ny r'c �UUm U _ ¢ �EZcc�cmLL 0 m V fC Cmcc Coo yW.-� m v�=Em$ m�a.ry N m Z T �cOU' �,¢¢ rng� F Acmm E L°m�.9C E yW o F Z �i- x'N_ ��33ar¢a'aim>o W> a W 002 W 0 Z O U k CROYDON RISK CONSULTANTS 198 North Arrowhead Avenue, San Berardino, CA 92408 U.S.A. Telephone 909.884.8294 Facsimile 909.381.7610 croydonnsk®earthlink.rrct June 15, 2005 Robert E. Martin, P.E. General Manager EAST VALLEY WATER DISTRICT 3654 East Highland Avenue, Suite 18 Highland, CA 92346 Re: Insurance Renewal Management Project Dear Bob: I enjoyed meeting with you, Skip Wilson and Brian Tompkins in your offices on June 14, 2005. Thank you for taking the time to explain the current status of your major property and liability "package policy" and your concerns related to policy renewal on October 1,2005. We also discussed renewal of EV WD Workers' Compensation coverage on July 1, 2005, through Sander Kessler Insurance. We discussed the fact that Caldwell & Moreland Insurance Services has been your agent for about 20 years, and that it seems prudent in the face of escalating premiums and turmoil within the commercial insurance marketplace, to review the current policy and to more closely manage the renewal process. Your purpose in considering use of an outside consultant is to add scope to the renewal process and to reinforce due diligence aspects of your position as business managers. Sander Kessler has been broker for your Workers' Compensation policy for about 3 years. In that regard, I have prepared the following consulting services proposal for consideration by you and your Board of Directors. East Valley Water District East Valley Water District (EV WD) currently serves more than 66,000 residents within its 26 square mile service area, through some 275 miles of water mains. Water is acquired from the Santa Ana River, Bunker Hill Groundwater Basin and the City of San Bernardino. When needed, water is also acquired from the State Water Project and through San Bernardino Valley Municipal Water District. EV WD is responsible for providing an abundant, reliable supply of clean and healthful water to its customers. It also is responsible to its Board of Directors for providing sound and prudent management of facilities and assets and to protecting its operations and assets through commercial insurance policies, as approved by the Board. About Croydon Risk Consultants Croydon Risk Consultants (CRC) is an independent risk management consultancy. CRC is not affiliated with insurance companies, reinsurers, brokers, agents, intermediaries or others that may benefit from or participate in sales transactions. CRC clients are insurance buyers, insurers, reinsurers and, occasionally, insurance agents and brokers, but the service provided is consistently without contingent interest in future outcomes. CRC charges for services on an hourly fee basis or on a flat fee for a defined project. I am the sole proprietor and only consultant with CRC. More about CRC is attached as Exhibit A. CRC has successfully completed over 100 insurance renewal management projects over the past 29 years, many of the projects have involved the process to be described in the following proposal. By "successful" I refer to the outcomes of the project fulfilling project goals from a timing, qualitative and quantitative viewpoint. My Understanding of the Current Situation I understand that, generally, the property and liability "Package Policy" purchased through Caldwell & Moreland Insurance Services, has provided good coverage, policyholder services and reasonable costs over the past 20 years, or so. I also understand EV WD has experienced relatively few large losses over time, as well. What was Caldwell & Moreland is now Arroyo Caldwell & Moreland — an affiliation of insurance agencies, the ramifications of which are not fully apparent at this point in time. Workers' Compensation coverage now carries an Experience Modification of 79%, which means EVWD premiums are about 21% lower that is "typical" for other similar operations. Such a low modification, which can be above 100% as well, indicates a long- term, effective loss control and cost management program by EV WD and its insurers. Insurance premium levels have increased over the past several years, and there is serious disruption in the insurance marketplace due to inquiries by New York Attorney General Elliott Spitzer into broker compensation practices. Also there is a generally increasing requirement for more management involvement in essential transactions, EV WD management seeks the services of an independent consultant to assist in managing the renewal of the "Package Policy" due to expire October 1, 2005 through Arroyo Caldwell & Moreland, and the Workers' Compensation policy that renews on July 1, 2005, through Sander Kessler Insurance. Insurance Renewal Management Services Proposal The insurance renewal management project is best conducted in several, inter -related segments, each of which builds on the results of the preceding step, as follows: Meet with EV WD managers to discuss the general nature of EV WD operations and risk exposures. a. Review past premium and loss history and plans for future business development. An Information Request related to this work step is attached as Exhibit B. b. Discuss policyholder service goals of EV WD, either as provided by the insurance agent or facilitated by the agent and provided by insurers or outside vendors. 2. Send a letter from EV WD to each agent, announcing the project and requesting cooperation with CRC. A suggested letter is attached as Exhibit C 3. Review subject policies for policy construction — declarations, insuring agreements, conditions and exclusions, as may be tailored to EV WD risk exposures and operations. a. Note the policy review is strictly an overview, with an eye to strengthening coverage provisions, conditions and the general use of EV WD resources to book risk through deductibles and self-funded . retentions. b. The review process is not intended as a word -by -word analysis of the policy, with recommendations to amend policy wording and to alter coverage application. c. Major issues will be identified for action by EV WD, but a detailed analysis is not part of this project. 4. Prepare a letter -report to EV WD management with specific recommendations about policy provisions to be addressed as part of renewal processing (Workers' Compensation) or renewal proposals ("Package Policy"). a. Review each report segment with EV WD managers and Board as required. b. After review, major recommendations will need to be adopted by EVWD and communicated to each broker, in the form of insurance renewal instructions. 5. Meet with each broker to discuss renewal issues and to gauge expected market response to matters requiring coverage extension, increased risk retention by EV WD proposals by other than current carriers. 6. Meet with each broker to review proposals. a. Study and assess each proposal. b. Recommend the "best" proposals) to EVWD Board. c. Implement Board decisions, secure Binders, require renewal policies within 60 days following inception, review each renewal policy for conformance with renewal instructions, confirm compliance or variance. Scope and Limitations, Reliances and Representations As an independent consultant, CRC intends to provide experience -based advice to EVWD management, which will be incorporated into its overall decision process and insurance management approach. CRC advice is based on expertise in the insurance field, and experience drawn from many years "in the business", but the advice should be viewed by EVWD as a part of its decision process and not an offering of decisions for EVWD. CRC, as an advisor, is not party to conclusions or decisions by EVWD. This proposal and any work product resulting from acceptance are intended solely for the confidential use of EVWD. Any other distribution or use is not allowed without the express written authorization of CRC. This proposal and any work product resulting from acceptance are based on information provided by EVWD, its agents, brokers and carriers, without independent audit, confirmation or corroboration. Information is reviewed for reasonableness and context integrity. CRC promises best efforts in the conduct of this project, but offers no assurance that EVWD will realize financial or operational benefit from CRC work. There are many. , independent variable aspects inherent to insurance transactions, • most of which cannot be predicted or controlled. The future cannot be forecast and the behavior of the many persons party to EVWD insurance buying transactions, too, cannot be predicted. Confidentiality CRC agrees to hold as business confidential all information received as a result of and through the conduct of this project, including the existence of its relationship with EVWD, except as authorized by EVWD and to the extent such information enters the public domain and as may be required by law. Timing, Fees and Acceptance I propose to begin the insurance renewal management project as soon as practicable after approval by the EVWD Board. I strongly recommend approval before July 1, 2005 to enable CRC participation in review of Workers' Compensation insurance renewal proposals. CRC charges consulting fees at $300 hourly, plus direct out-of-pocket authorized expenses for travel and supplementary services (copying, express mailing, etc.). Fees are charged 1/3 in advance, with monthly fee charges as the project advances, and with total 4 fees to be "trued up" as the project segment is completed. Invoices are payable upon receipt. An additional fee of 1% monthly applies to invoices unpaid for over 30 days. 1. Workers' Compensation Project Segment a. With renewal of Workers' Compensation insurance on July 1, 2005, I propose to assist EVWD in evaluation of the renewal proposal and to review the policy once it is issued, for a fee estimated to be $6,000 (about 20 hours at $300 hourly), payable $2,000 in advance and $4,000 once a Workers' Compensation Renewal recommendation letter is issued. b. Deliverables include a written assessment of renewal proposals (policy terms and conditions, carrier security, services and costs), and specific recommendations for strengthening the program. 2. "Package Policy" Renewal Project Segment a. The "Package Policy" renews on October 1, 2005. I propose to assist EV WD in managing the renewal process for an estimated fee of $12,000 (about 40 total hours at $300 hourly), payable $4,000 in advance, with monthly payments leading to a final fee accounting after review of renewal proposals. . b. Deliverables include written recommendations, with reasons, for consideration by brokers and carriers in structuring renewal proposals, written analysis of each renewal proposal and recommendation of the proposal "best" suited to EVWD needs and goals. To accept this proposal, please arrange for a signature by an authorized EVWD manager, Officer or Board member, indicating acceptance, and send a copy to me along with a check for $6,000, payable to Croydon Risk Consultants. For reference, my federal employer identification number is 33-0891417. Thank you for the opportunity to work with you on this important project. �ncerely, Paul W. Pinckney, CP U Principal EV WD hereby accepts this proposal, signed I its (title) an authorized signer, dated 2005. Exhibit A - CROYDON RISK CONSULTANTS PAUL W. PINCKNEY, CPCU, Principal Paul Pinckney is the proprietor of Croydon Risk Consultants (CRC), an independent risk management consultancy, which he launched on February 1, 2000. He is the sole consultant with the firm. CRC is located in San Bernardino, California, and has client relationships throughout the world. Mr. Pinckney retired at the end of 1999, after 15 years as a Principal and Shareholder of Towers Perrin. He and his Partners sold Towers Perrin the Los Angeles -based consulting firm Mund, McLauirn & Co. in 1985. He joined MMC in 1976. For 12 years prior to entering the risk management consulting field, Mr. Pinckney held Marketing and Underwriting management positions with a leading U.S.-based property and casualty insurer. He earned a Bachelor of Arts degree in Economics from La Verne University in 1964, and received the CPCU designation in 1971. He taught CPCU courses for 3 years immediately thereafter. Mr. Pinckney has developed consulting practice specializations in: ➢ Alternative risk transfer and financing, including captive insurance, Risk Retention Groups and insurance -based profit-making programs, ➢ Insurance company operations, including development of alternative risk transfer programs, program business and development of strategic relationships, ➢ Risk management planning, organizational effectiveness studies and analysis of the role and responsibilities of risk managers, ➢ Broker selection, broker performance review, insurance program design and renewal strategies and broker/carrier services planning and review. ➢ Advice to lenders and insurance regulators in assessing captive insurance applications and business plans and in developing strategies for captive domiciles. CRC charges fees on an hourly rate basis or as a stipulated amount by project, plus project -related expenses. CRC provides value-added, experience -based collaborative relationships with clients, and is often asked to continue to provide advice and counsel following project completion and initial implementation. CRC may be reached at 198 North Arrowhead Avenue, San Bernardino, CA 92408 USA. Telephone 909.884.8294, facsimile 909.381.7610 or e-mail croydonrisk@earthlink.net. Copyright © Croydon Risk Consultants Exhibit B — CROYDON RISK CONSULTANTS EVWD INSURANCEW RENEWAL MANAGEMENT PROJECT Information Request — June 29, 2005 To facilitate review of current Workers' Compensation and "Package Policy" terms and conditions, and to prepare for renewal of these policies, please organize copies of the following information for review by CRC: Workers' Compensation Current in -force policy, along with any endorsements.* 2. Premium and loss history — past 5 years. Most recent Experience Modification worksheet. 4. Copy of the most recent renewal application provided to your broker. Risk control and loss cost control manual and procedures. 6. Outline of the services plan provided by Sander Kessler Insurance and by your carrier. 7. Summary by EVWD managers of service needs and goals related to "best practices" in providing cost control, claims management and overall policyholder services to EVWD. "Package Policy" Copy of the notice sent to EVWD by Arroyo Caldwell & Moreland explaining the affiliation of the two agencies and the benefits the arrangement will bring to EVWD. 2. Copy of the current policy, along with any endorsements.* Copy of the most recent renewal information worksheets used to guide 2004- 2005 policy renewals. 4. Current listing of insurance risk exposures — locations and values of properties, description and value of vehicles, payroll, gallon volume, payrolls by classification. 5. Premium and loss history — past 5 years 6. Most recent loss control report from your carrier and/or broker. Risk Control and Loss Cost Management manual and procedures. May be called "Risk Management manual'. 8. Summary of the Policyholder Services Plan prepared by your broker and/or carrier. 9. Summary of EV WD services goals and expectations related to its property and liability insurance program, including risk management, loss control, claim cost management and overall policyholder services to EV WD. * Policy review may be done in EVWD offices if agreeable to EV WD managers. 2 Exhibit C - EV WD Letterhead June 29, 2005 1) Sander Kessler Insurance 2) Arroyo Caldwell & Moreland Insurance Re: 1) Workers' Compensation Policy Review 2) "Package Policy" Renewal Review Dear xxxxxxx This is to advise that EVWD has engaged an independent risk management consultant to review our 1)Workers' Compensation 2) property and liability insurance program. Paul W. Pinckney, CPCU, Principal With Croydon Risk Consultants (CRC) will contact you soon to arrange a meeting in our offices to discuss the history, current situation and future of the program, including impending renewal proposals. A copy of Paul's CV is attached for reference. Please extend Paul every courtesy, your full cooperation and open access to information he may seek and documentation he may wish to review and/or copy. Our Board of Directors considers the 1)Workers' Compensation program Z) "Package Policy" to be an essential aspect of EV WD operations: We are hopeful the review by CRC will provide insight into the application of this program to our business. Thank you for your cooperation on this matter. Sincerely, Robert E. Martin, P.E. General Manager