Minutes - Board - 2024-04-09COSTA MESA SANITARY DISTRICT
MINUTES OF BOARD OF DIRECTORS STUDY SESSION
APRIL 912024
Members present
Arlene Schafer, Art Perry, Bob Ooten, Brett Eckles, Mike Scheafer
Members absent
None
Staff present
Scott Carroll (General Manager), Noelani Middenway (District Clerk/Public
Information Officer), Gina Terraneo (Management Analyst II), Lieu Tran (Senior
Accountant), Alan Burns (District Counsel), Marissa Pereyda (Management Analyst
II), Amanda Doan (Accounting Clerk), Jesus Flores (Facilities Maintenance Worker)
Others present
Jeremy Tamargo, NBS Government Finance Group
Jim Mosher, District resident
Julie Barreda, CR&R
Karen Millard, Claimant
Michael Tou, Citizens Advisory Committee Vice Chair
Mike Carey, CR&R
Meeting called to order at 8:00 A.M.
A. OPENING ITEMS
Procedural: 1. Roll Call - (If absences occur, consider whether to deem those
absences excused based on facts presented for the absence - such determination
shall be the permission required by law.)
President Scheafer called the meeting to order at 8:00 A.M.
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District Clerk and Public Information Officer, Noelani Middenway, noted
that President Scheafer, Vice President Schafer, Secretary Perry, Vice
Secretary Ooten, and Director Eckles were present.
B. PUBLIC COMMENTS
Procedural: 1. Public Comments
President Scheafer opened public comments.
District resident, Jim Mosher, commented that, although the District's
Operations Code contains a statute of limitations for refunds, California's
Discovery Rule states that the statute of limitations only starts when the
crime has been discovered. He discussed transparency issues affecting
Orange County property tax bills. He suggested including more information
on property tax bills and service rates in the District newsletter. He noted
that the District does not have a policy regarding undercharges.
Hearing no additional comments, President Scheafer closed public
comments.
C. ITEMS OF STUDY
1. Closed Session: Conference with Legal Counsel -Anticipated Litigation
Significant exposure to litigation pursuant to Paragraph (2) of subdivision (d)
and Paragraph (4) of subdivision (e) of Section 54956.9 (1 case)
President Scheafer adjourned to closed session at 8:03 a.m.
2. Open Session: Many any announcements required by law
President Scheafer reconvened from closed session at 8:22 a.m. He reported
that the Board has authorized the General Manager to reopen negotiations
with the claimant. He stated that the Board will decide how to proceed after
the two parties have completed their negotiations.
There was no further discussion.
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Action: 3. Motion to Reconsider/Renew Consideration of Karen Millard's Claim
President Scheafer stated that the Board will not reconsider Ms. Millard's
claim until negotiations are complete. He noted that this issue will be
resolved at the April Board meeting.
There was no further discussion.
Presentation: 4. Introduction of new CMSD Employees: a. Amanda Doan,
Accounting Clerk b. Robert Morris, Engineering Technician c. Jesus Flores,
Facilities Maintenance Worker
Senior Accountant, Lieu Tran, introduced the District's new Accounting
Clerk, Amanda Doan, and discussed her background.
General Manager, Scott Carroll, introduced the District's new Facilities
Maintenance Worker, Jesus Flores, and discussed his background. He noted
that the District's new Engineering Technician, Robert Morris, is on vacation.
There was no further discussion.
Receive and File: S. Receive and File Code Enforcement Office Report —
February & March 2024
Recommendation: That the Board of Directors receive and file this report.
Code Enforcement Officer, David Griffin, presented the Code Enforcement
Officer reports for the months of February and March. He shared the
locations of scavenging encounters and reported 177 cases of trash carts in
public view for March 2024. He stated that there were no cases of graffiti.
President Scheafer discussed scavenging activity in the alleyway behind his
work office.
Vice Secretary Ooten asked where scavengers are redeeming their
recyclables.
Mr. Griffin stated that most scavengers do not share that information. He
suggested that they use a facility located outside of Costa Mesa.
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CR&R representative, Mike Carey, shared that there was a recycling center
on Fairview Road and MacArthur Boulevard, but it has closed. He noted that
stores that sell beverages are obligated to accept recyclables if there are no
recycling centers within a half -mile radius of that beverage retailer. He
stated that these stores redeem recyclables for cash.
There was no further discussion, and the report was received.
Discussion, Presentation: 6. Three -Cart Curbside Collection Program Rollout
Plan Presented by CR&R
Recommendation: That the Board of Directors receive and file this report.
Mr. Carroll introduced the item and Julie Barreda, Regional Vice President
of CR&R.
Ms. Barreda stated that cart deliveries and exchanges will begin on
November 7, 2024. She noted that the program rollout will take about 12
weeks and includes a two -week delay for the Christmas Tree Collection
Program in early January 2025. She explained that every customer will
receive one Recycling Cart and one Mixed Waste Cart will be removed unless
that customer chooses to keep that cart for an additional cost. She clarified
that every customer can have up to two Organics Recycling Carts.
Discussion followed regarding the program rollout dates.
Mr. Carroll stated that CR&R will be ordering additional carts after they
complete their cart survey.
Mr. Barreda shared that it takes eight weeks to receive new carts and
another two weeks to assemble them.
Director Eckles inquired about the cart delivery and exchange process.
Ms. Barreda stated that, if a customer forgets to place their carts out for the
rollout process, then CR&R will exchange them on their next collection day.
She shared that CR&R performs a cart audit every two years to ensure that
customers are paying for the correct number of carts.
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Vice President Schafer inquired about CR&R's customer service.
Ms. Barreda stated that CR&R will be conducting extensive training with its
customer service representatives regarding the District's rollout plan.
President Scheafer commented on the two -week delay for the Christmas
Tree Collection Program. He suggested starting the rollout process in early
October to avoid any delays.
Ms. Barreda discussed CR&R's cart size survey.
Discussion followed regarding cart colors.
President Scheafer suggested having cart surveys available at the District's
town hall meetings.
Discussion followed regarding customers who were previously exempt from
the Organics Recycling Program.
Ms. Barreda continued her presentation regarding the cart transition
process.
President Scheafer asked how many calls CR&R expects to receive regarding
the rollout.
Ms. Barreda stated that CR&R did not receive too many calls after completing
the City of Laguna Niguel's cart rollout. She noted that there will be
information on CR&R and the District's website. She added that customers
are already responding positively to the District's social media outreach.
Discussion followed regarding customer phone number data.
Ms. Barreda discussed the logistics of cart deliveries including loading and
offloading CR&R's delivery trucks. She stated that customers will be asked to
leave their carts curbside until 6 p.m. on their collection day. She shared that
the Mixed Waste Carts will be relabeled with a landfill sticker a week after
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the rollout. She discussed the District's town hall meeting schedule and
presentation.
Discussion followed regarding the location of the town hall meetings.
Ms. Barreda noted that customers will have multiple opportunities to discuss
the rollout plan with the District and CR&R. She shared an example of a
three -cart system infographic.
Director Eckles requested data from the City of Newport Beach's three -cart
rollout.
Discussion followed regarding the rollout start date and how the rollout will
impact multifamily properties.
Mr. Carroll requested direction from the Board on the rollout start date.
President Scheafer requested to add that discussion as an agenda item to the
April Board meeting.
Mr. Mosher complimented CR&R's cart exchange process for his
neighborhood in Newport Beach. He noted that the City of Newport Beach
only provided mail communication and did not host any town hall meetings.
He added that there was a period of logistical issues with trash collection,
but that the issues were fixed within a month. He stated that there were
discrepancies between the disposal directions that were embossed on the
cart lids and the directions that were provided after the rollout. He
commented that the District's recycling outreach is also confusing especially
regarding mixed -material items and textiles. He recommended providing
information on the most common waste sorting mistakes.
Vice Secretary Ooten discussed the City of Upland's waste sorting
information.
Ms. Barreda discussed CR&R's waste characterization studies. She noted that
CR&R no longer embosses disposal information on their cart lids.
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President Scheafer recommended providing photos of common waste items
that are incorrectly sorted at the upcoming town hall meetings. He also
suggested mailing a "do" and "don't" postcard regarding waste sorting
methods after the rollout.
There was no further discussion, and the report was received.
Discussion: 7. Draft Solid Waste Rate Study
Recommendation: That the Board of Directors provide direction to staff.
Management Analyst II, Marissa Pereyda, introduced the item and reviewed
the initial draft solid waste study from NBS Government Finance Group
(NBS). She stated that the study's occupancy rate was revised to include the
cost of the new Recycling Cart and Senate Bill (SB) 1383 compliance. She
noted that these revisions have increased the District's proposed
expenditures and rates.
Jeremy Tamargo of NBS provided a brief overview of the study's
methodology and showed a comparison of the originally proposed rates and
the revised rates. He stated that CR&R's projections for the occupancy fee
increased by 55% for Fiscal Year 2024-2025 due to the transition from the
two -cart system to the three -cart system. He discussed the study's five-year
and ten-year rate projections and cost -of -service analysis. He provided
information regarding a two-year rate structure compared to a five-year
rate structure.
Discussion followed regarding the study's revised occupancy rate.
Director Eckles inquired about the regional monthly rate comparisons.
Mr. Carroll noted that CR&R's capital expenses for the three -cart system
increased the proposed rates.
Ms. Pereyda stated that each year within the proposed 5-year rate structure
includes a 5% Consumer Price Index (CPI) adjustment.
Discussion followed regarding the District's occupancy rate compared to
other local agencies.
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Secretary Perry exited the meeting at 9:43 a.m.
Director Eckles requested a comparison of the District's net -to -hauler rate to
the average within Orange County.
Discussion followed regarding a two-year rate structure.
President Scheafer inquired about rate increases affecting other
jurisdictions.
Ms. Barreda shared that a few other jurisdictions have implemented rate
increases to account for SB 1383. She noted that she will provide the District
with the net -to -hauler rates for their other clients.
President Scheafer commented on the study's proposed reserve targets.
Vice Secretary Ooten stated that District policy requires a 30% reserve level
for its Solid Waste Fund. He noted that the study includes a 35% reserve
level.
Ms. Pereyda noted that the study recommends a 35% reserve level.
Mr. Tamargo stated that the proposed five-year structure is based on a 30%
reserve level. He noted that a 35% reserve target is recommended to soften
the impacts of unexpected changes.
Vice Secretary Ooten inquired about potential unexpected changes.
Mr. Tamargo stated that SB 1383 can be considered an unexpected change.
President Scheafer clarified that he supports a 30% reserve level.
Director Eckles suggested removing the recommended 35% reserve target
from the study.
Ms. Pereyda stated that this item will be presented at the April Board
meeting for adoption.
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Director Eckles requested more information regarding the study's revisions
prior to its adoption.
President Scheafer suggested having a special Board meeting prior to the
April Board meeting.
Director Eckles requested to review a two-year or four-year rate structure.
Discussion followed regarding net -to -hauler rates.
Director Eckles requested to compare the District's proposed rates to the City
of Newport Beach's customer rates.
There was no further discussion.
D. CLOSING ITEMS
Procedural: 1.Oral Communications and Director Comments
None.
Procedural: 2. Adjournment
President Scheafer adjourned the meeting at 10:04 A.M.
Art Perry Mike Scheafer
Secretary President