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Minutes - CAC - 2024-03-13COSTA MESA SANITARY DISTRICT MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING MARCH 13, 2024 CAC Members present Jeff Arbour, Daniel Baume, Rosemarie Chora, Dickie Fernandez, Dean Fisher, Sue Lester, Michael Tou CAC Members absent Cindy Brenneman, Francesca Normington, Annette Watson Board Members present Art Perry, Michael Scheafer Staff present Scott Carroll (General Manager), Noelani Middenway (District Clerk & Public Information Officer), Gina Terraneo (Management Analyst II), Marissa Pereyda (Management Analyst II) Others present Jeremy Tamargo, NBS Government Finance Group Jim Mosher, District resident Meeting called to order at 6:00 P.M. A. OPENING ITEMS Procedural: 1. Call to Order Citizens Advisory Committee (CAC) Chair Lester called the meeting to order at 6:00 p.m. COSTA MESA SANITARY DISTRICT PAGE 2 MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING HELD MARCH 13, 2024 Procedural: 2. Roll Call District Clerk and Public Information Officer, Noelani Middenway, conducted roll call. She noted that CAC Members Arbour, Baume, Chora, Fernandez, Fisher, Lester, and Tou were present, while CAC Members Brenneman, Normington, and Watson were not present. Procedural: 3. Public Comments - Speakers will be limited to three minutes. The three minutes per speaker time allotted may be extended for good cause by a majority vote of the committee. CAC Chair Lester opened public comments. Hearing none, she closed public comments. B. ITEMS Action: 1. Approve the Citizens Advisory Committee Meeting Minutes of January 10, 2024 Recommendation: That the Citizens Advisory Committee approves the meeting minutes as presented. CAC Chair Lester introduced the item. Motion: To approve the meeting minutes as presented. Motion by Michael Tou, seconded by Dean Fisher. Final Resolution: Motion carries 7-0-0-3 Ayes: Jeff Arbour, Daniel Baume, Rosemarie Chora, Dean Fisher, Dickie Fernandez, Sue Lester, Michael Tou No: None Abstain: None Not Present: Cindy Brenneman, Francesca Normington, Annette Watson There was no further discussion. Action: 2. Draft Solid Waste Rate Study Recommendation: That the Citizens Advisory Committee provides feedback. COSTA MESA SANITARY DISTRICT PAGE 3 MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING HELD MARCH 13, 2024 Marissa Pereyda, Management Analyst II, introduced the item and Jeremy Tamargo of NBS Government Finance Group (NBS). Mr. Tamargo presented an overview of the preliminary draft solid waste rate study. He discussed the survey's methodology, financial plan, cost -of - service analysis, and design of rates. He noted that rates must be proportional to the cost of service to comply with Proposition 218. He displayed a comparison between the current and proposed rates and a comparison between the District's recommended rates and current rates of similar agencies in Orange County. He provided details regarding the rate study's timeline. Discussion followed regarding solid waste reserve levels and capital expenses. General Manager, Scott Carroll, clarified that CR&R is responsible for all solid waste capital expenses. CAC Vice Chair Tou inquired about solid waste rate increases for nearby cities like Tustin and Irvine. Mr. Carroll stated that nearby cities may subsidize their residential solid waste rates with the revenue collected from their commercial solid waste rates. Discussion followed regarding operations and maintenance (O & M) costs and CR&R's Consumer Price Index (CPI) rate adjustment. CAC Member Chora inquired about customer classes and equitable rates. Discussion followed regarding variable rates. Mr. Tamargo noted that tiered and flat rate structures are utilized by other agencies for solid waste services. COSTA MESA SANITARY DISTRICT PAGE 4 MINUTES OF THE CITIZENS ADviSORY COMMITTEE MEETING HELD MARCH 13, 2024 Mr. Carroll stated that he is not aware of any agencies within Orange County that utilize a tiered rate structure for solid waste services. CAC Member Chora and Chair Lester expressed support for a variable rate structure for District customers. CAC Member Chora expressed concern about minimum and maximum reserve amounts. CAC Member Fisher inquired about the financial plan and the recommended reserve targets. Mr. Tamargo explained the purpose of the proposed reserve levels. He noted that the current reserve levels will not be sufficient for the next 10 to 20 years. Discussion followed regarding previous rate increases. CAC Member Chora stated that, according to the proposed rate structure, the current District customers are subsidizing rates for future District customers. Mr. Carroll stated that District staff will reassess the proposed rate increases to reduce the proposed reserve levels. Mr. Tamargo stated that the proposed 5% annual adjustment is the maximum adjustment amount. He noted that the Board has the discretion to lower that adjustment amount. Discussion followed regarding rate adjustments and inflation. CAC Member Tou inquired about Proposition 218 protests. Mr. Carroll stated that the District would need to receive 50.1% of protests to successfully challenge the proposed rates. District resident, Jim Mosher, inquired about rate ceiling amounts. COSTA MESA SANITARY DISTRICT PAGE 5 MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING HELD MARCH 13, 2024 Mr. Tamargo clarified that, for each fiscal year, the maximum rate ceiling is set on the rate notice. He stated that the Board has the discretion to pause rate adjustments within the proposed 5-year period and adopt the maximum rate amount in the last year of the period. CAC Member Fernandez inquired about the projected deficit for the Solid Waste Fund. Mr. Tamargo stated that, according to the projections, the fund will have a deficit of $267,000 by 2034. There was no further discussion. Action: 3. Mitigating Odors at Elden and President Pump Stations Recommendation: That the Citizens Advisory Committee provides feedback and suggestions to staff. Mr. Carroll presented report details. CAC Chair Lester inquired about the cost of the charcoal cannisters. Mr. Carroll stated that the cannisters cost $5,000 per year. Discussion followed regarding alternative options to the cannisters and odors at the President Pump Station. President Scheafer shared that a pump station is located on his property. He discussed odors originating from the Santa Ana riverbed. CAC Vice Chair Tou inquired about the life expectancy of the exhaust fan at the Elden Pump Station. There was no further discussion. Action: 4. Permanent Generator at Harbor Pump Station COSTA MESA SANITARY DISTRICT PAGE 6 MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING HELD MARCH 13, 2024 Recommendation: That the Citizens Advisory Committee provides feedback and suggestions to staff. Mr. Carroll presented report details. Discussion followed regarding natural gas generators and battery -powered generators. CAC Vice Chair Tou discussed space issues affecting the location of the proposed generator. There was no further discussion. Action, Receive and File: S. FY 2023-24 Work Plan Update Recommendation: That the Citizens Advisory Committee receives and files this report. Mr. Carroll presented report details. There was no discussion, and the report was received. C. CLOSING ITEMS Procedural: 1. Committee Member Comments CAC Chair Lester thanked District staff for following up with the dollar amount of CR&R's CPI increase and for providing an event list for volunteering. She inquired about CAC applications for the 2024-2026 term. Mr. Carroll stated that there will be seven vacancies on the CAC after tonight's meeting. He noted that there are no term limits for CAC members. He added that the Board will be reviewing the CAC applications at the March Board meeting and issuing appointments. Ms. Middenway shared that CAC Member Normington officially resigned from her position. CAC Chair Lester thanked the 2022-2024 CAC members for their service. COSTA MESA SANITARY DISTRICT PAGE 7 MINUTES OF THE CITIZENS ADVISORY COMMITTEE MEETING HELD MARCH 13, 2024 CAC Vice Chair Tou congratulated the District on receiving so many applicants. He inquired about the Compost and Shredding Event. Ms. Middenway stated that the District is working on securing a location and date. There was no further discussion. Procedural: 2. Board/Staff Comments None. Procedural: 3. Adjournment CAC Chair Lester adjourned the meeting at 7:16 p.m. and stated that the next CAC meeting is scheduled for May 8, 2024. Sue Lester Citizens Advisory Committee Chair