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COSTA MESA SANITARY DISTRICT
MINUTES OF BOARD OF DIRECTORS REGULAR MEETING
SEPTEMBER 21, 2017
Members present
Arlene Schafer, Art Perry, James Ferryman, Mike Scheafer
Members absent
Bob Ooten
Staff present
Scott Carroll (General Manager), Noelani Middenway (District Clerk), Alan Burns
(District Counsel), Wendy Davis (Finance Manager), Marc Davis (District Treasurer),
Robin Hamers (District Engineer), Nabila Guzman (Management Analyst I), Gina
Terraneo (Management Analyst I)
Others present
Jim Mosher (resident), Luke Money (Daily Pilot), Dean Ruffridge (CR&R)
Meeting called to order at 5:32 P.M.
A. OPENING ITEMS
Procedural: 1. Call to Order
President Scheafer called the meeting to order at 5:32 P.M.
Procedural: 2. Pledge of Allegiance
President Scheafer led the pledge of allegiance.
Procedural: 3. Invocation
Vice President Ferryman led the invocation.
Procedural: 4. Roll Call
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MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING
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District Clerk, Noelani Middenway, conducted roll call and President Scheafer,
Vice President Ferryman, Secretary Schafer, and Director Perry were present.
Ms. Middenway noted that Assistant Secretary Ooten was absent and excused
from the meeting.
Procedural: 5. Ceremonial Matters and Presentations
None at this time.
Procedural: 6. Announcement of Late Communications
None at this time.
Procedural: 7. Public Comments
President Scheafer opened public comments.
Jim Mosher, a resident, commented that the Board of Directors previously
directed staff to include an item about the Citizens Advisory Committee in today's
meeting agenda and noted that the item is not included in the agenda.
General Manager, Scott Carroll, explained that staff is awaiting information from
the City of Costa Mesa to complete the staff report for the Citizens Advisory
Committee. He noted that the report will likely be included in the October 10
Study Session agenda.
Seeing no one else wishing to speak, President Scheafer closed public
corn ments.
B. CONSENT CALENDAR
Action (Consent): 1. Approve Consent Calendar
Recommendation: That the Board of Directors approve the Consent Calendar as
presented.
Action (Consent): 2. Approve Board of Directors Study Session Meeting Minutes of
August 8, 2017
Recommendation: That the Board of Directors approve the Study Session Minutes of
August 8, 2017 as presented.
Action (Consent): 3. Approve Board of Directors Regular Board Meeting Minutes of
August 24, 2017
Recommendation: That the Board of Directors approve the regular board meeting
minutes of August 24, 2017 as presented.
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Action (Consent): 4. Approve the Directors' Compensation and Reimbursement of
Expenses
Recommendation: That the Board of Directors approve the compensation and
reimbursement of expenses as presented.
Action (Consent): 5. Approve Payroll Transparency Disclosure for August 2017
Recommendation: That the Board of Directors approve and file the report.
Action (Consent): 6. Accept the occupancy count as presented as 22,518 and direct
staff to prepare a warrant to CR&R Environmental Services for $220,572.82 for
August 2017 collection
Recommendation: That the Board of Directors accepts the occupancy count as
presented using 22,518 as the correct number of active units and directs staff to
prepare a warrant to CR&R Environmental Services for August 2017 collection based
on this occupancy report so long as the contractor fulfills the obligations of the
agreement in the amount of $220,572.82 to be ratified in the September 2017 warrant
list.
Action (Consent): 7. Receive and file CCTV (Closed Circuit TV) Program Report
Recommendation: That the Board of Directors receive and file the report.
Action (Consent): 9. Receive and File Annual Report of Expenses- Fiscal Year
2016-17
Recommendation: That the Board of Directors receive and file the Annual Report of
Expenses for the Fiscal Year 2016-17.
Action (Consent): 10. Adopt Warrant Resolution No. CMSD 2018-03 Approving
District Warrant Registers in the amount of$485,582.37
Recommendation: That the Board of Directors adopt Warrant Resolution No. CMSD
2018-03 approving District warrants for the month of August 2017 in the amount of
$485,582.37.
Action (Consent): 11. Approve the preparation of a warrant to CR Transfer in the
amount of $221,343.57 for August 2017 recycling and disposal services in the
September 2017 warrant register
Recommendation: That the Board of Directors approves the preparation of a warrant to
CR Transfer in the amount of $221,343.57 for August 2017 recycling and disposal
services to be ratified in the September 2017 warrant register.
Action (Consent): 12. Approve Investment Report for the Month of August 2017
Recommendation: That the Board of Directors approve the Investment Report for the
month of August 2017.
President Scheafer noted that a request was made to pull Item #8 from the
Consent Calendar for discussion.
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Motion: That the Board of Directors pull item #8 for discussion and approve the
remainder of the Consent Calendar as presented.
Motion by Jim Ferryman, second by Arlene Schafer.
Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent
Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer
Action: 8. Receive and File Fiscal Year 2016-2017 Annual Compliance Report for
Requirements of Government Code Section 66013 (d) for Capacity Charges.
Recommendation: That the Board of Directors receive and file this report.
Jim Mosher, a resident, made comments regarding the City of Newport Beach's
handling of sewer capacity charges and questioned why a negative interest of
$3,715 appears on the attached Annual Compliance Report for Capacity
Charges.
Finance Manager, Wendy Davis, noted that the negative interest is the result of
an accounting mechanism to capture the fair market value and net interest of the
District's investments at a given time. She explained that the fair market value of
the District's investments has decreased since last year, but the decrease is
never realized because the District holds investments until their maturity.
Motion: That the Board of Directors receive and file this report.
Motion by Art Perry, second by Jim Ferryman.
Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent
Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer
There was no further discussion and the Board of Directors approved the
Consent Calendar as presented.
C. PUBLIC HEARINGS
None at this time.
D. GENERAL MANAGER'S REPORTS
Action: 1. Consider contributing $500 to Costa Mesa High School Football
Boosters for Stadium Banner
Recommendation: That the Board of Directors:
1. Establish the purpose CMSD is trying to serve as a contributor to the Costa Mesa
High School Football Boosters; and
2. Describe how the expenditure will advance CMSD's purpose; and
3. Consider contributing $500 to continue hanging an Organics Recycling Program
banner at Mustangs Field.
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Management Analyst I, Gina Terraneo, presented the Contribution Application
request for a monetary contribution of $500 to hang a promotional banner in
Costa Mesa High School's Mustangs Field.
President Scheafer indicated agreement with the staff recommendation to
continue hanging a banner in Mustangs Field, rather than changing the banner
location.
Director Perry commented that the banners at Mustangs Field seem to be
spaced out on the stadium fence, unlike the banners at Estancia High School,
making them more visible.
President Scheafer noted that the banner promotes the Organics Recycling
Program and gives residents the District's contact information.
Vice President Ferryman requested clarification regarding the pricing and
quantity of the banners.
Director Perry noted that residents will also see the banner during track events.
Discussion followed regarding the position of last year's stadium banner.
Motion: To contribute $500 to continue hanging a banner at Mustangs Field for
the purpose of promoting the Organics Recycling Program and increasing the
District's solid waste diversion rate.
Motion by Art Perry, second by Arlene Schafer.
Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent
Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer
The Board of Directors directed staff to continue hanging a banner at Mustangs
Field for the purpose of promoting the Organics Recycling Program and
increasing the District's solid waste diversion rate.
There were no further questions or discussion.
Action: 2. CR&R Contract Negotiations - Update
Recommendation: That the Board of Directors provide direction to staff.
General Manager, Scott Carroll, presented report details regarding the District's
contract negotiations with CR&R. He noted that CR&R has agreed to the
following points: a fixed term limit of ten years with two five-year extension
options to replace the evergreen clause of the contract, a District-wide door-to-
door household hazardous waste (HHW) collection service, an annual free mulch
giveaway event, an annual reimbursement of $35,000 (along with Consumer
Price Index increases) for various solid waste programs, a public outreach
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program to help the District achieve 75% diversion, roll-out assistance to seniors
and disabled residents without requested proof of age or disability, and a total of
two possible requests for Consumer Price Index increases by CR&R per year
that must be approved by the Board of Directors prior to implementation. Mr.
Carroll added that CR&R did not agree to the following points: use of the
Newport Beach Transfer Station, access to CR&R's GPS system on District
computers, and lowering the Organics Recycling rate in relation to the Second
Amendment of the contract. He noted that the City of Stanton negotiated an
Organics Recycling Program with CR&R at no cost to residents and cited the
District's contract with CR&R which states that, "if CONTRACTOR [CR&R]
negotiates a lower rate with any Orange County agency, then that rate shall
become the rate of the DISTRICT." Mr. Carroll shared that CR&R declined the
District's suggested compromise of lowering the District's Organics Recycling
rate to $55.50 per ton for three years. Lastly, he presented the following options
for the Board of Directors: to do nothing and continue with the existing contract,
direct staff to send CR&R a cancellation notice to be effective September 20,
2023 and prepare a Request for Proposal for qualified solid waste companies in
2021, direct District Counsel to review the Second Amendment of the contract to
determine if a breach of contract occurred, direct staff to continue negotiating
with CR&R, or accept the deal points agreed upon and direct staff to bring back a
new contract for approval.
Director Perry requested clarification regarding the annual free mulch giveaway
event and.the current door-to-door HHW program.
Secretary Schafer asked if staff presented any other proposed compromises
besides the lower Organics Recycling rate of$55.50 per ton for three years.
Mr. Carroll responded that there were no other proposals made.
Vice President Ferryman commented that he would like to see CR&R cooperate
with what is stated in the contract.
President Scheafer indicated agreement with Vice President Ferryman.
Dean Ruffridge of CR&R commented that CR&R did not negotiate a lower rate
with the City of Stanton and indicated that he does not believe there is a breach
of contract.
Vice President Ferryman suggested that this item be discussed in further detail at
a future study session.
President Scheafer indicated agreement.
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Mr. Carroll suggested that the District hire a consultant to look into Stanton's rate
structure.
Discussion followed regarding the cost of hiring a consultant.
Mr. Ruffridge suggested that the Board of Directors direct District Counsel, Alan
Burns, to review the Second Amendment of the contract to determine if a breach
of contract occurred.
The Board of Directors directed District Counsel, Alan Burns, to review the
Second Amendment of the contract to determine if a breach of contract occurred
and for staff to bring this item back to the October 10 Study Session for further
discussion.
There were no further questions or discussion.
E. ENGINEER'S REPORTS
Action, Receive and File: 1. Receive and File Capital Improvement Projects Status
Report
Recommendation: That the Board of Directors receive and file this report.
District Engineer, Robin Hamers, presented report details and noted that two
projects were finalized last month. He added that the plans for the Yard
expansion are in plan check with the City of Costa Mesa.
Vice President Ferryman noted that there was an inquiry about the proposed
landscaping for the Yard expansion during the Liaison Committee Meeting.
Mr. Carroll noted that there are currently several city trees on the property.
There were no other questions or discussion and the report was received.
F. TREASURER'S REPORTS
None at this time.
G. ATTORNEY'S REPORTS
None at this time.
H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is
required to be given by a Director for any meeting for which expense reimbursement of
any kind is provided. Note: For meetings for which the per diem compensation is
sought, the Operations Code provides that such compensation is authorized for each
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MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING
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day's service rendered as a Director at the request of the Board (not to exceed six days
in one month), and certain meetings are specified as being eligible as set forth in District
Operations Code § 3.01.030. For meetings not so listed, the Board must approve the
service for it to be eligible for the per day compensation.
Discussion: 1. Orange County Sanitation District (OCSD) - (Vice President
Ferryman)
Vice President Ferryman noted that there will be an OCSD meeting next week.
Discussion: 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director
Perry)
Director Perry noted that there will be a SARFPA meeting next week.
Discussion: 3. Independent Special Districts of Orange County (ISDOC)
(President Scheafer)
President Scheafer shared that he attended the Executive Committee Meeting
earlier this month. He indicated uncertainty of the direction of ISDOC under its
current leadership.
Discussion: 4. California Special Districts Association (CSDA) - (Secretary Schafer)
Secretary Schafer shared that CSDA is preparing for their upcoming conference
and that she is running for Vice President of CSDA.
Discussion: 5. Special District Risk Management Authority (SDRMA) - (President
Scheafer)
President Scheafer noted that there is no SDRMA meeting this month.
Discussion: 6. Other Meetings Qualifying for Reimbursement under CMSD
Ordinance No. 55, Operations Code Section 3.01.030
Director Perry shared that he, Secretary Schafer, and Assistant Secretary
Ooten attended the Water Advisory Committee of Orange County (WACO)
meeting. He noted that there was discussion of Orange County's water supply,
SB 623, and water storage plans.
President Scheafer commented that the September 15 Liaison Committee was
productive.
Discussion followed regarding the City of Costa Mesa's Arlington Drive Bioswale.
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MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING
HELD SEPTEMBER 21,2017
I. OLD BUSINESS
None at this time.
J. NEW BUSINESS
None at this time.
K. ORAL COMMUNICATIONS AND DIRECTOR COMMENTS
President Scheafer thanked staff.
Director Perry noted that there was discussion of the public restroom project
during the Liaison Committee Meeting. He suggested that an item be placed on a
future study session agenda about the potential pilot program.
General Manager, Scott Carroll, shared that he suggested a mobile restroom
option to the City of Costa Mesa's Homeless Task Force. He noted that staff is
coordinating a meeting with representatives from each agency within the Liaison
Committee to discuss cost and logistics.
Secretary Schafer commented that more information is needed before the District
commits to participating in a public restroom pilot program.
L. ADJOURN TO CLOSED SESSION
No closed session.
M. RECONVENE TO OPEN SESSION
No closed session.
N. CLOSING ITEMS
Procedural: 1. Adjourn
President Scheafer adjourned the meeting at 6:31 P.M.
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Arlene SchaferMic'ael Scheafer
Secretary , President