Minutes - Board - 2011-04-27�-M
COSTA MESA SANITARY DISTRICT
MINUTES OF BOARD OF DIRECTORS SPECIAL MEETING
APRIL 27, 2011
Directors Present: Robert Ooten, James Ferryman, Mike Scheafer,
Jim Fitzpatrick, Art Perry .
Staff Present: Scott Carroll, General Manager
Sherry Kallab, Administrative Manager
Robin B. Hamers, District Engineer
Teresa Gonzalez, Accountant
AJ Cully, Program Assistant
iThe Board of Directors of the Costa Mesa Sanitary District met on Wednesday,
April 27, 2011 at 5:30 p.m., in the Board Conference Room at the Costa Mesa Sanitary
District, 628 W. 19th. Street, Costa Mesa, California to consider the 2011 -12 CMSD
Budget.
President Ooten opened the meeting at 5:30 p.m.
Mr. Carroll expressed his appreciation to District Staff for their diligence in preparing the
draft Budget.
Mr. Carroll gave a power point presentation on the proposed budget for 2011 -2012.
Discussion was held on revenues, expenditures, capital improvements, succession
planning, asset management, strategic plan, rates and pension reform.
Total revenues equal $14,811.750. Solid Waste revenues equal an annual charge of
$5,155,000 (96.72 %), a container charge of $100,000 (1.87 %); investments $45.000
(0.84 %) and contributions of $30,000 (0.57 %). Liquid Waste revenues equal an annual
charge of $5,114,000 (99.18 %); investments $10,000.(0.19%), permits $5,000 (0.09 %)
and inspection fees of $28,000 (0.54 %).
Mr. Carroll recommended discontinuance of the used tire program due to lack of
participation and the expense of Staff time involved.
•
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Minutes of Special Meeting Held April 27, 2011
• Mr. Carroll also recommended discontinuance of the summer large item collection
program with the call -in program expanded to 2 large item collections per residence per
year. The Board directed Staff to ensure adequate notification to residents as the
annual large item collection program is a very popular program in the City.
Total expenditures equal $10,486,088 including $8,394,740 for maintenance and
operations; $1,401,740 for payroll; $346,000 for capital outlay; $249,108 for
engineering and $94,500 for programs.
Discussion on the status of the CMSD video was held. The project was halted due to
concerns regarding changes in personnel. Mr. Carroll will look into its status.
Another expenditure involves televising of the CMSD meetings minutes; and a new
vehicle for the District is in the budget.
Mr. Carroll reported on a proposal to increase the size of the Board conference room
and knocking out the wall between the conference room and a staff office to make it
possible to have a dais for the Board, General Manager and District Clerk; and
expansion to the front office lobby for employee security concerns. Discussion was
held on the expansion with differing views on the necessity for such expenditures. The
Board directed Staff to schedule a study session to further discuss this item.
• Mr. Carroll presented Capital Improvement Projects recommended for Fiscal Year
2011 -12 totaling $2,547,250.
Expenditures for Solid Waste maintenance and operations equal $4,597,600. Liquid
Waste expenditures for maintenance and operations equal $822,220'.
Administration Professional Services include IT services, records management, pump
station study, branding, personnel services and wastewater engineer's report for a total
of $127,780. Administration contracts equal $196,100. Engineering expenditures
equal $249,108. Program expenditures equal $94,500.
Succession Planning include reassigned responsibilities due to recent staffing changes
and the retirement of the Administrative Manager in December 2011. Mr. Carroll
reported on proposed changes to existing staff; proposed changes to existing vacant
positions and proposed changes to the Administrative Manager job description. These
changes would decrease payroll costs by 12.08 %.
Mr. Carroll presented a proposed organizational chart. President Ooten requested the
contract positions be noted as such.
Mr. Carroll spoke about pension reform and noted CaIPERS is currently conducting a
cost analysis of the CMSD revised pension plan with findings expected in May or June
• 2011..
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Minutes of Special Meeting Held April 27, 2011
• Mr. Carroll presented the budgeted amounts for Strategic Plan Goals.
Mr. Carroll presented 10 -year expense projections for trash rates. Director Fitzpatrick
challenged the Board on their reasoning for not going out to bid on the trash contract.
Director Fitzpatrick questioned how he could persuade the other four Directors to go out
to bid on the trash contract. Directors Ferryman and Perry stated they see no reason to
go out to bid on the contract; and elaborated that CR &R is performing well and the
citizens of Costa Mesa are satisfied with the trash service. President Ooten stated a
comparison on rates with other cities is not comparable as the other cities do. not
include administrative fees in their rates Ms. Gonzalez stated the CMSD administrative
fee is 14 %. Mr. Carroll informed the Board he will conduct an analysis of the District's
administrative The and review CR &R's contract to determine if the District can go out to
bid after four years when the term of the contract expires. Director Fitzpatrick
requested Staff to conduct a study on going out to bid on the trash contract. Director
Scheafer stated the majority of the Board does not support going out to bid and that the
Board of Directors approved a 10 -year contract which the District should honor.
Director Fitzpatrick stated he has not received adequate response. Director Ferryman
stated the Board has responded and does not want to go out to bid.
• Discussion was then held on CMSD employee. CPI increases. Mr. Carroll stated there
is an automatic CPI that was put into place when employees left their City jobs to work
directly for the CMSD. Another contributing factor is the employees do not have union
representation. Mr. Carroll stated he is not proposing a complete elimination of CPI,
but rather it should be approved by the Board annually instead of being automatically
included in the budget. The Directors requested input from Staff.
Ms..Cully stated she is proud to be a member of the organization and the. CMSD is not
in the financial position of the City of Costa Mesa or other agencies. Ms. Cully stated
the Staff is the District's most. important commodity and the cost for a CPI increase for
CMSD employees is approximately $21,000.
Further, if the Board is considering such luxuries as enlarging the building, they should
certainly not deny the CPI adjustment for its dedicated employees. Director Ferryman
stated his problem with an employee getting a merit raise and ,a CPI increase totaling
7 %. Mr. Harriers stated Staff works hard for the District and would appreciate a pat on
the back in the form of a CPI increase and the power of the agency is the production of
the employees. Mr. Carroll pointed out that all employees will not receive a merit
increase as they are at the top of their pay scale. It was pointed out the CPI increase is
in the CMSD contractual agreement. President Ooten stated the CPI increase will
remain in the contract as committed to by the Board when the employees moved from
the City of Costa Mesa. The amount of the CPI increase for the year 2012 is 2.3 %.
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Minutes of Special Meeting Held April 27, 2011
• Discussion was held on pension reform. Mr. Carroll stated -there are 30 bills in
Sacramento on pension reform. Staff proposes any new employees pay their share of
CalPERS which is 7% of their annual salary. Currently, CMSD picks up the employees'
share of CaIPERS.
•
In conclusion, Mr. Carroll summarized Fiscal Year 2011 -12 Budget is a spending plan
that reduces salaries and benefits; funds strategic goals; creates an asset management
fund; funds an aggressive capital • improvement program; implements succession
planning with NO rate increases.
ADJOURNMENT
President Ooten adjourned the meeting at 7:30 p.m.
Approved by:
Secretary
President
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