VALLEY CENTER MUNICIPAL WATER DISTRICT
Regular Board Meeting
Monday, August 7, 2006
Time: 2:00 P.M.
Place: Board Room
29300 Valley Center Road
Valley Center, CA 92082
The Valley Center Municipal Water District Board of Directors’ meeting was called to order by President Broomell at 2:00 P.M.
ROLL CALL
Board members present were: Directors Broomell, Polito, Aleshire, Stone and Haskell. Staff members present were: General Manager Arant, General Counsel Cowett, Director of Finance Jeffrey, Director of Operations Hoyle, District Engineer Grabbe, Board Secretary Stetson, IT Specialist Rivard, and Administrative Assistant Johnson. Spectator present was Ms. Pam Means.
APPROVAL OF AGENDA
Upon motion by Aleshire, seconded by Stone and unanimously carried, the Board approved modifying the agenda to consider item 8, Resolution of Intention to Approve Amendment to Contract Between CalPERS and VCMWD, under the Closed Session.
CONSENT CALENDAR
1. Upon motion by Polito, seconded by Haskell and unanimously carried, the following consent calendar items were approved:
• Minutes of the Board meeting held July 17, 2006
• Audit demand check numbers 109462 through 109806
• Treasurer’s Report and Financial Statement for the period ended June 30, 2006
• Purchase Order No. 16588 to Hawthorne Machinery Co. in the amount of $83,250 for the purchase of a Caterpillar 430E backhoe loader
• Purchase Order No. 16595 to Aqua Metric in the amount of $57,203.79 for the purchase of automated meter reading equipment
ACTION AGENDA
2. Supervisory Control and Data Acquisition (SCADA) Project – Modification of Sole Source Manufacturer for Radio and Approval of Purchase Order for Radio Equipment:
District Engineer Grabbe reviewed that sole sourcing of specific equipment for the SCADA project had been approved on May 1st by Resolution No. 2006-20. Wave Wireless had been selected as the sole source manufacturer of radio equipment for the SCADA system as it was considered to have the most cost effective product. District Engineer Grabbe reported that Cisco Systems has recently introduced upgraded radio equipment and enhanced features that warrant modifying the District’s selection for sole source manufacturer of the radio equipment for the wireless network. Cisco Systems’ newly introduced radio equipment meets the District’s design requirements with substantially fewer radios which reduces the overall cost of their equipment. Enhanced features of the Cisco Systems’ product expand the capabilities of the SCADA network, enabling it to provide desirable services that would be more costly with the Wave Wireless equipment. The additional functionality of the Cisco Systems’ equipment results in reduced costs for the management of the wireless system providing one secure network expanded to field, enhanced security central management and set-up, and radio frequency ID tracking.
The Cisco Systems solution costs approximately $1,100 more per radio and requires $10,000 more for network components, software and licenses than the Wave Wireless product, adding approximately $90,000 to the project’s cost. However, the cost to duplicate the potential functionality of the Cisco radios with the Wave Wireless system would be considerably more. Also, because the enhanced features benefit other District functions beyond the SCADA System project, the increased cost will be allocated to other cost centers, specifically the Information Technology department budget.
Cisco Systems and Wave Wireless offer government pricing of 30% off the list price. An additional 10% discount was offered by Cisco Systems for orders placed and delivered prior to July 31, 2006. This additional discount provided a savings of $15,693 for the radios needed for the Phase 1 and 2 facilities. Because Phase 1 and 2 improvements are scheduled to be released for bid in the next few months, staff felt it was prudent to secure the additional savings and issued a purchase order on July 25th in the amount of $94,852.85 with the concurrence of the Board President for the purchase of 22 radios, wireless network, controller components and licenses for the SCADA project.
Staff recommended adoption of Resolution No. 2006-38 to modify the SCADA project’s sole source equipment list to designate Cisco Systems, Inc. as the radio supplier for the project and adoption of Resolution No. 2006-39 approving the purchase order in the amount of $94,852.85 for the discounted radio equipment from Cisco Systems for the SCADA project.
Discussion ensued regarding procedures for purchases deemed in the best interest of the District’s operations when action by the full Board is not feasible and expeditious action is required. Currently, policy provides that the General Manager may approve purchases less than $35,000. In an emergency, the General Manager can expend funds on behalf of the District up to a $500,000 limit. The Board directed staff to develop a policy for the Board’s consideration addressing approval of expenditures by the General Manager in a non-emergency situation but necessitating immediate action.
Upon motion by Aleshire, seconded by Haskell and unanimously carried, the following resolutions, entitled:
RESOLUTION NO. 2006-38
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
MODIFYING THE SOLE SOURCE MANUFACTURER
OF RADIOS FOR THE SCADA PROJECT
RESOLUTION NO. 2006-39
RESOLUTION OF THE BOARD OF DIRECTORS OF
VALLEY CENTER MUNICIPAL WATER DISTRICT
APPROVING PURCHASE ORDER NO. 16592 FOR
DISCOUNTED RADIO EQUIPMENT NEEDED
FOR THE SCADA PROJECT
were adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
3. General Manager’s Participation in the Valley Center Rotary Club:
General Manager Arant stated that he has been invited to become a member and participate in the Valley Center Rotary Club. Their weekly meetings are on Monday at noon, lasting approximately 1-1/2 hours. Approval of the General Manager’s membership in the Valley Center Rotary Club will annually cost between $500 and $750.
Upon motion by Aleshire, seconded by Stone and unanimously carried, the General Manager’s participation in the Valley Center Rotary Club was approved.
GENERAL MANAGER’S AGENDA
4. Review of Miscellaneous Informational Items:
• Regional Seawater Desalination Project at Encina – At the San Diego County Water Authority’s July 27th Board meeting, it was unanimously voted to not certify the final environmental impact report (EIR) for the regional seawater desalination facility at the Encina Power Station in Carlsbad. The Board’s decision was predicated upon an announcement by the Encina Power Station’s owner, NRG Energy Inc., that they plan to replace the existing power station with a plant that would no longer use seawater for cooling, but be an air cooled plant. Utilizing Encina’s seawater intake and discharge system was the method evaluated in the EIR for the proposed Authority’s desal. project. Also, NRG Energy is proposing a new energy generation facility at the same location that had been selected for the regional seawater desalination plant. Due to these developments at the power station, the Authority Board concluded that conditions had changed such that the existing EIR for the regional seawater desalination facility at the Encina Power Station should not be certified. The Board reaffirmed its commitment to seawater desalination as an important water supply for the county and it will work closely with its member agencies on other local water supply projects.
The San Diego County Water Authority Board also terminated its negotiations with Poseidon Resources, which has a lease to construct and operate a desalination project at the Encina Power Station and reaffirmed its commitment with the City of Carlsbad that addresses a local member agency-led desalination project in Carlsbad.
General Manager Arant stated that he will pursue having Peter MacLaggan of Poseidon Resources at the next Board meeting to provide an update on Poseidon’s efforts to construct a desalination plant at the site of the Encina Power Station in Carlsbad noting that the District entered into a long-term agreement with Poseidon Resources to purchase up to 7,500 acre feet annually of desalted seawater from the proposed facility.
• South Node Sewer Project – Staff continues to work on the District’s draft Master Plan for Wastewater Services. The county’s proposed general land use plan, GP 2020, has not yet been completed. The County’s EIR for its GP 2020
Plan will address traffic and growth impacts. It is felt that it would be advantageous for the District to defer completion of the sewer master plan and related EIR to allow the county to proceed with its GP 2020 process and become the lead agency in dealing with traffic and growth impact issues within its EIR. This action could delay the South Node Sewer project by approximately 3 to 6 months.
• Municipal Service Review – A working group meeting for the Municipal Service Review for the Bonsall and Pala Hydrologic Subareas (San Luis Rey M.W.D. latent powers application) will be held at the District’s office on September 12th.
• Orchard Run Project – D.R. Horton, the proposed developer of the Orchard Run project, has withdrawn from the project. Mr. Belanich, the property owner, is marketing the property for development. At this time, to coincide with the County’s Valley Center Road improvement project, bids will be solicited for the construction of two 6-inch lines (forced main sewer and reclaimed water lines) from Mirar de Valle across Valley Center Road for a future connection to the Woods Valley Wastewater Treatment Plant. Financial contributions for this project will be obtained from Mr. Belanich and Bell properties as well as participation by the District.
GENERAL COUNSEL’S AGENDA
5. Court Decision on the Applicability of Proposition 218 Pertaining to Procedures to Revise Water and Sewer Rates:
General Counsel Cowett stated that the California Supreme Court has issued its decision regarding the Bighorn-Desert View Water Agency case pertaining to the applicability of Proposition 218 for the process to increase water and sewer rates. The court ruled that both water and sewer commodity charges are property based fees within the meaning of Proposition 218. Therefore, any proposed revisions to the District’s water and sewer rates will require that a public hearing be held and the public hearing be noticed to customers and property owners within the District’s service area. Proposition 218 provides for a majority protest during the public hearing. General Counsel Cowett stated he will be working with District staff to establish procedures.
BOARD OF DIRECTORS’ AGENDA
6. Report on ACWA/JPIA Meetings:
Director Aleshire reported that he had attended the ACWA/JPIA Executive Committee and Finance Committee meetings on July 24th. A new auditor was selected. Director Aleshire noted that the JPIA’s policy is that the Executive Committee’s appointed Auditor Controller selects the auditor which is a policy he feels should be revised. JPIA’s liability losses have significantly decreased from occurrences of 1.12 per $1 million of payroll in the 1980s to the current occurrences of .84 per $1 million of payroll with commensurate reductions in cost of claims. This reduction in liability claims can be attributed to the JPIA’s training programs. Liability insurance coverage for JPIA’s members has been increased to up to $50 million of coverage.
At the ACWA Board meeting, the majority approved supporting Proposition 84, “The Safe Drinking Water, Water Quality and Supply, Flood Control, River and Coastal Protection Bond Act of 2006”.
CLOSED SESSION
7. A Closed Session was called by President Broomell at 3:16 p.m. pursuant to Government Code '54957.6 – Conference with Labor Negotiator to consider the employees’ request to enhance the California Public Employees’ Retirement System (CalPERS) contract from 2% at 55 to 2.5% at 55.
Director of Finance Jeffrey reviewed that procedures for such enhancement are consideration of adoption by the Board of a Resolution of Intention to approve said amendment to the contract with Cal-PERS. Upon adoption of the Resolution of Intention, an employee election will be conducted that requires a simple majority vote for approval. Director of Finance Jeffrey reported that Cal-PERS has determined that the contract amendment increases the present value of benefits $1,271,106 and the accrued liability $514,683. The cost for the enhanced contract to be paid by employees is 3.034% of payroll.
RECONVENE
8. The regular Board meeting was reconvened at 5:45 p.m., and the following action was reported:
Upon motion by Aleshire, seconded by Polito and unanimously carried, the following resolution, entitled:
RESOLUTION NO. 2006-40
RESOLUTION OF INTENTION TO APPROVE AN
AMENDMENT TO CONTRACT BETWEEN THE
BOARD OF ADMINISTRATION
CALIFORNIA
PUBLIC
EMPLOYEES’ RETIREMENT SYSTEM AND THE
BOARD OF
DIRECTORS
VALLEY
CENTER
MUNICIPAL
WATER DISTRICT
was adopted by the following vote, to wit:
AYES: Directors Broomell, Polito, Aleshire, Stone and Haskell
NOES: None
ABSENT: None
ADJOURNMENT
9. Upon motion by Stone seconded by Haskell and unanimously carried, the meeting was adjourned at
5:47 p.m.
ATTEST: ATTEST:
____________________________ _______________________________
President Secretary