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Minutes - Board - 2025-12-151 COSTA MESA SANITARY DISTRICT Io yJ t f \RppRAI�.� COSTA MESA SANITARY DISTRICT MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING December 15, 2025 Members present: Michael Scheafer, President Robert Ooten, Vice President Arth u r Perry, Secretary Nicole Wiltshire, Director Shayanne Wright, Director Members not present: None Staff present: Scott Carroll, General Manager Noelani Middenway, DistrictClerk/P1O Gina Terraneo, Senior Management Analyst Marissa Pereyda, Solid Waste Manager Kaitlin Tran, Finance Manager Dyana Wick, Administrative Services Manager Alan Bums, District Counsel Marc Davis, District Treasurer Others present: Joe Jenkins, EEC Environmental Paul Kaymark, Nigro & Nigro Adam Probolsky, Probolsky Research Sue Lester, CAC Chair/District customer Michael Tou, CAC Vice Chair/District customer Cindy Brenneman, CAC Member/District customer Julie Barreda, CR&R Mike Carey, CR&R Craig Preston, District customer A. OPENING ITEMS 2 1. Call to Order President Scheafer called the meeting to order at 4:30 p.m. 2. Pledge of Allegiance President Scheafer led the Pledge of Allegiance. 3. Invocation Vice President Ooten led the Invocation. 4. Roll Call District Clerk and Public Information Officer, Noelani Middenway, conducted roll call and noted that all Board Members were present. 5. Announcement of Late Communications None. 6. Ceremonial Matters and Presentations None. B. PUBLIC COMMENTS President Scheafer opened public comments. Hearing no one, he closed public comments. C. CONSENT CALENDAR There was no discussion. Moved By Vice President Robert Ooten Seconded By Secretary Arth u r Perry Motion: That the Board of Directors approve the Consent Calendar as presented. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary Arthur Perry, Director Nicole Wiltshire, and Director Shayanne Wright Carried (5 to 0) 1. Approve the Board of Directors Study Session Minutes of November 10, 2025 2. Approve the Board of Directors Regular Meeting Minutes of November 24, 2025 3. Adopt Warrant Resolution No. CMSD 2026-06 Approving District Warrant Registers K, 4. Consider Approval of the Board of Directors Compensation and Reimbursement of Expenses 5. Approve Payroll Transparency Disclosure for November 2025 6. Approve the Preparation of a Warrant to CR Transfer for $175,694.82 and to CR&R, Inc. for $6,242.17 in the December 2025 Warrant Register for November 2025 Recycling and Disposal Services 7. Receive and File November 2025 Tonnage and Diversion Report 8. Approve the Occupancy Count of 23,268 and Direct Staff to Prepare a Warrant to CR&R Environmental Services for $409,051.44 in the December 2025 Warrant Register for November 2025 Solid Waste Collection Services 9. Approve Investment Report for September 2025 10. Approve Investment Report for October 2025 11. Receive and File November 2025 Contracts Signed by the General Manager D. PUBLIC HEARINGS None. E. GENERAL MANAGER'S REPORTS 1. Receive and file the Annual Comprehensive Financial Report (ACFR), and the Auditors' Required Communication for the year ended June 30, 2025 Recommendation: That the Board of Directors receive and file: 1. The Annual Comprehensive Financial Report for Year Ended June 30, 2025. 2. The Auditors' Required Communication for the Year Ended June 30, 2025. Finance Manager, Kaitlin Tran, shared the report's financial highlights, including that the auditing firm issued an unmodified opinion and thatthe District's net position and operating revenue increased from the prior year. Paul Kaymark of Nigro & Nigro, PC presented the report details. He shared his firm's scope of work, discussed the audit results, and highlighted the District's changes in revenues and expenses and its investment earnings. 2. Receive and File Results of the 2025 Communitywide Customer Opinion Survey Recommendation: That the Board of Directors receive and file the results of the 2025 Communitywide Customer Opinion Survey conducted by Probolsky Research. 0 Adam Probolsky of Probolsky Research presented the 2025 Communitywide Customer Opinion Survey results. He provided an overview of the survey design and methodology and highlighted results, including topics like satisfaction with services, opinion on current rates and rate structures, recycling habits and education, and preferred communication methods. Lastly, he discussed the demographics of the respondents. President Scheafer asked how the approval ratings compare to other special districts. Mr. Probolsky commented that the District's approval ratings are relatively high. Director Wright inquired about staff's process for addressing the survey results. General Manager, Scott Carroll, shared that staff requests policy direction from the Board, reviews the results, and implements targeted outreach. Director Wright requested a summary of Mr. Probolsky's recommendations. Discussion followed regarding the difference between the Solid Waste Rate Study and this survey. Director Wright shared her background in customer research and commented that surveys are not always the best method for obtaining customer feedback. She critiqued spending funds on a general awareness survey without a plan for its use, as well as the survey's omission of multi -unit renters. She indicated support for conducting the survey once every 3 years or looking into a different method of customer research. President Scheafer commented that he is encouraged by the survey's results, particularly the data about recycling. Discussion followed regarding multi -unit renters and how survey respondent data is obtained. President Scheafer commented that he would support including multi -unit renters in the next su rvey. Director Wiltshire commented that multi -unit owners should also be included. Discussion followed regarding gaps between reported satisfaction and usage. Julie Barreda of CR&R commented that organics cart usage has improved. Vice President Ooten recommended making a list of recommendations based on the report's results. He suggested various outreach measures. Director Wiltshire recommended implementing paid social media campaigns around food waste education and the recycling process. She indicated agreement regarding including multi -unit customers in future surveys. Discussion followed regarding results related to CR&R's service. President Scheafer opened public comment. Sue Lester, CAC Chair and District customer, commented that the demographics of respondents seemed to skew older. She also commented that she does not agree with including non -solid waste customers in the survey respondent group. Mr. Probolsky commented that the survey respondents are an accurate reflection of the District's customer demographics. 3. Consider Accepting 2025 Internal Audit of CMSD's Sewer System Management Plan Performed by EEC Environmental Recommendation: That the Board of Directors: 1. Accept the 2025 internal audit findings of CMSD's Sewer System Management Plan performed by EEC Environmental; and 2. Direct staff to prepare an action plan with timeline for completion regarding EEC's recommended SSMP enhancements. Mr. Carroll explained the purpose of the Sewer System Management Plan (SSMP) audit. Joe Jenkins of EEC Environmental, presented the SSMP audit requirements and process, its findings, preventative maintenance efforts, FOG control efforts, nonconformances, and recommended program enhancements. Discussion followed regarding spill training opportunities. President Scheafer adjourned the meeting to a recess at 6:17p.m. Moved By Vice President Robert Ooten Seconded By Secretary Arth u r Perry Motion: To: 1. Accept the 2025 internal auditfindings of CMSD's Sewer System Management Plan performed by EEC Environmental; and 2. Direct staff to prepare an action plan with timeline for completion regarding EEC's recommended SSMP enhancements. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary Arthur Perry, Director Nicole Wiltshire, and Director Shayanne Wright R Carried (5 to 0) 4. Receive and File the Popular Annual Financial Report (PAFR) for the Year Ended June 30, 2025. Recommendation: That the Board of Directors receive and file the PopularAnnual Financial Report for the year ended June 30, 2025. President Scheafer reconvened the meeting at 6:26 p.m. Mr. Carroll introduced the item and noted that the PAFR is a transparent report that not many other agencies create. Ms. Tran noted that the PAFR is a smaller, easily understandable financial report than the ACFR. Director Wright thanked staff for producing this report. 5. Consider Appointing One (1) Citizens Advisory Committee Member to Fill 2026-2027 Vacancy Recommendation: That the Board of Directors consider appointing one (1) applicant to serve the remainder of the vacant Citizens Advisory Committee term ending March 2027. Ms. Middenway presented the nine applications forthe Board's review. President Scheafer suggested continuing the item to a future Study Session. The Board indicated agreement. Director Wright commented that she would like an opportunity for the Board to converse with the applicants. She noted that the City has a process that allows each Council Member to propose an appointment and she suggested switching to this appointment model. Lastly, she noted that some applications were not submitted in time to be included in the agenda. Ms. Middenway noted thatthree applicants submitted applications afterthe agenda was posted. The Board directed staff to continue this item to the January Study Session and include only these nine applications. President Scheafer opened public comment. rA Craig Preston, customer and applicant, introduced himself and expressed his support for public service. He shared his background and interest in environmental issues. Ms. Lester encouraged the Board to fill the position tonight. She noted thatthe Citizens Advisory Committee's (CAC) next meeting is in January and discussed voting division representation on the CAC. She suggested adding a field to the application that asks applicants to read the CAC Handbook. The Board asked staff to invite all applicants to attend the next Study Session. 6. Consider Approval of the 2026 Meeting Calendar Recommendation: That the Board of Directors approve the proposed 2026 meeting calendar as presented in Exhibit A. Ms. Middenway presented the proposed 2026 meeting calendar. Discussion followed regarding the December Board Meeting date. The Board directed staff to move the December Board Meeting up by one week to Monday, December 14. Moved By Secretary Arth u r Perry Seconded By Director Nicole Wiltshire Motion: To approve the proposed 2026 meeting calendar as presented in Exhibit A. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary Arthur Perry, Director Nicole Wiltshire, and Director Shayanne Wright Carried (5 to 0) 7. Continue Discussion to Consider Adopting Proposed Pay -As -You -Throw Program for Solid Waste Collections Recommendation: That the Board of Directors provide direction to staff on the following: 1. Require consultant to include tiered rates, along with a flat rate, in their solid waste rate study. 2. Direct staff to continue researching this program, including feedback from a focus group. 3. Bring back additional information at a future Board of Directors meeting. Mr. Carroll provided an overview of the proposed Pay -As -You -Throw (PAYT) program and noted that he is seeking direction from the Board. He provided additional information, including the CAC's discussion minutes and information about other special districts with PAYT programs. 001 President Scheafer commented that he thought this topic would not be discussed again until next year. Secretary Perry indicated support for holding off on discussing the PAYT program. Mr. Carroll noted that staff received proposals for the Solid Waste Rate Study and commented that now is the Board's opportunity to include tiered rates in the study if they are interested in knowing the cost. Director Wright discussed the potential benefits of obtaining the cost of tiered rates, but noted that the information would not remain relevant if the Board does not implement the program in the nearfuture. Secretary Perry commented that he does not support moving the District's assessments off of the property tax roll because it is an easy way to collect funds. Director Wright indicated agreement. Vice President Ooten noted that the majority of community survey respondents did not support moving to a PAYT program. Moved By Director Shayanne Wright Seconded By Secretary Arth u r Perry Motion: To not pursue the Pay -As -You -Throw program. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary Arthur Perry, Director Nicole Wiltshire, and Director Shayan ne Wright Carried (5 to 0) F. ENGINEER'S REPORTS 1. Receive and File the District Engineer's Monthly Report and Capital Improvement Projects Status Recommendation: That the Board of Directors receive and file the Capital Improvement Status Report. There was no discussion and the report was received. G. TREASURER'S REPORTS 1. Approve Investment Report for November 2025 E Recommendation: That the Board of Directors approve the Investment Report for the month of November 2025. District Treasurer, Marc Davis, presented the November Investment Report. He highlighted market news, inflation news, and current investment portfolio performance. Moved By Secretary Arth u r Perry Seconded By Director Sh ayan n e Wright Motion: To approve the Investment Report for the month of November 2025. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary Arthur Perry, Director Nicole Wiltshire, and Director Shayanne Wright Carried (5 to 0) H. ATTORNEY'S REPORTS 1. Consider Adopting Ordinance No. 141 Increasing the Contracting Authority for the General Manager and Making Numbering Changes to the Code Recommendation: That the Board of Directors adopt Ordinance No. 141 Increasing the Contracting Authority for the General Manager and Making Numbering Changes to the Code. District Counsel, Alan Burns, presented Ordinance No. 141 and explained that it will raise the Gen eral Man ager's auth ority to issu e a contract for gen eral pu rch ases u p to $25,000 without using special bidding procedures. Director Wright commented regarding neutralizing the use of gender in the ordinance language. Moved By Secretary Arth u r Perry Seconded By Director Nicole Wiltshire Motion: To adopt Ordinance No. 141 Increasing the Contracting Authority for the General Manager and Making Numbering Changes to the Code. Ayes: (5): President Michael Scheafer, Vice President Robert Ooten, Secretary ArthurPerry, Director Nicole Wiltshire, and Director Shayanne Wright Carried (5 to 0) I. LOCAL MEETINGS 1. Orange County Sanitation District (OCSD) - (Vice President Ooten) Vice President Ooten shared that meeting was business as usual. irl 2. Santa Ana River Flood Protection Agency (SARFPA) - (Secretary Perry) Nothing to report. 3. Independent Special Districts of Orange County (ISDOC) - (President Scheafer) Nothing to report. 4. California Special Districts Association (CSDA) - (President Scheafer) President Scheafer commented that CSDA is looking for speakers for the annual conference. 5. Special District Risk Management Authority (SDRMA) - (President Scheafer) Nothing to report. 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 Vice President Ooten shared highlights from the Water Advisory Committee of Orange County (WACO). J. OLD BUSINESS None. K. NEW BUSINESS None. L. CLOSING ITEMS 1. Oral Communications and Director Comments President Scheafer thanked staff and wished everyone happy holidays. 2. Adjournment President Scheafer adjourned the meeting at 7:11 p.m. 1�c Arthur Perry, Secretary it r Michael Scheafer, 4resident