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Agenda Packets - Board - 2002-02-06Phone (714) 754 -5043 Fax (714) 432 -1436 WebAddresT s� wwwci.costa- niesa.ca.us Mailing Address P. O. Box 1200 Costa Mesa, CA 92628 -1200 C 0 1& 4121 0 & n - a_ ooata Mesa 6a'nimars Dionrict SPECIAL MEETING FOR THE PURPOSE OF A STRATEGIC PLANNING STUDY SESSION FEBRUARY 6, 2002 The Board of Directors of the Costa Mesa Sanitary District will meet on Wednesday, February 6, 2002 at 12:00 p M. in Conference Room 5A of the Costa Mesa Civic Center, 77 Fair Drive, Costa Mesa, California. I. Review and Open Discussion of the following documents: A. Action Items from Strategic Planning Sessions February 1 -3, 2001 B. Planning Workshop Notes from February 2 -3, 2001 C. Letter from Martin Rauch dated June 6, 2001 II. Additional Discussion Street Address 6""'4 a4 77FairDrive A. Selection of District Officers at Election Years Yr: Costa Mesa, CA 92626 -6520 B. Board Education — Benefit of Attendance at Seminars and Conferences C. Future LAFCO Actions -TOLAS $` ((Z FAotA - -)AFco D. Level and Cost of Service Provided by District Board of Directors Arlene Schafer E. Other Greg Woodside ArtPerry III. Determine Staff Members to attend Saturday February 16,2002 James Ferryman Workshop Dan Worthington IV. Public Comments Dated: January 29, 2002 Rec Printed on Recycled Paper joan/Revak Clerk of the District COSTA MESA SANITARY DISTRICT ACTION ITEMS FROM STRATEGIC PLANNING SESSIONS ISSUE 1) Finances thl 1.1 ,4 1.2 February 1 -3, 2001 Trash Collection Program Issue: Is interest income from reserve needed to fund cost of service to prevent a rate increase? What effect will trash container purchase have? Why did trash lose money last year? Action: Direct Treasurer to estimate costs and expenses and identify if trash pays own way. Who: Treasurer r When: By March 8, 2001, Board of Directors Meeting. Property Taxes Issue: Why isn't District receiving more property tax? Action: Treasurer to report and provide explanation. Who: Treasurer /Manager (Staff to call Bob Oman). When: By April 12, 2001, Board of Directors Meeting. CMSD Action Items Strategic Planning Sessions Page 2 1.3 Understanding Reserves Issue: Understanding reserves. Action: Treasurer to explain basis for size of reserves, explain reserves more completely, and determine an appropriate level (GASB -34, politics, etc.). Who: Treasurer /Manager. When: Trash by March, Sewer by May /June. 1.4 Electrical Costs Who: When ISSUE Possible increase in electrical costs. Identify current electrical costs and estimate potential increase. Perform public outreach if needed. Treasurer /Manager. May /June. 2) Capital Improvements 2.1 Understanding Sewer Capital Improvement Projects 10�OVE& Issue: Complete sewer master plan update. Action: a) Complete master plan update by end of calendar year 2001. Who: Manager/ District Engineer. When: By end of 2001. Issue: VWAction Who: When ISSUE Possible increase in electrical costs. Identify current electrical costs and estimate potential increase. Perform public outreach if needed. Treasurer /Manager. May /June. 2) Capital Improvements 2.1 Understanding Sewer Capital Improvement Projects 10�OVE& Issue: Complete sewer master plan update. Action: a) Complete master plan update by end of calendar year 2001. Who: Manager/ District Engineer. When: By end of 2001. s' CMSD Action Items Strategic Planning Sessions Page 3 Action: b) Review and evaluate format of current project financial reports and project status reports. Who: Board of Directors. When: May 2001. Action: c) Consider monthly study session and business meeting (regular meeting) Who: Board of Directors. When: March 2001. 2.2 Office Facility Issue: Cramped quarters, no room for growth. Inefficient (0010, working space for management staff; additional resources needed. 2.3 TA Action: Consider Corporation Yard and other alternatives (space at end of hall; lease, buy). Who: Form Sub - Committee. When: Approve at February 8, 2001, Board of Directors Meeting. Discharge (Sewer Spills) Issue: CMOM requires rigorous inspection, planning and maintenance, satisfying all components now but need continued effort. Action: No initiative needed. Continue; potential for additional televising, GIS. Cy EEAs' £ 6P=44N'Cd ?) { i CMSD Action Items Strategic Planning Sessions Page 4 2.4 Fully Automated Trash Collection Issue: Philosophical; can't collect loose trash. Can phase in from semi- automated; need to negotiate with hauler. Action: Decide to buy /lease cans. Continue study of fully automated program. (See 1.1 and 1.3 on trash costs) Who: Treasurer /Board of Directors When: Study Session — February 15, 2001. / 2.5 Mitigate Anticipated Future Cost Increases Issue: Reminder to seek to cut costs first rather than raise rates. Inform public of "big picture ". /2.6 Costs of CIP Issue: If current level of sewer activity maintained, current rates are sufficient. Trash rates need review. (See 2.4, 1.1, 1.3) 0im) Action: Consider series of modest sewer rate increases rather than future jump. Prepare financial master plan for trash (see 2.4, 1.1, 1.3) now. Sewer financial master plan will be contained in Sewer Master Plan Update. Who: Treasurer. When: May /June 2001, in time for next budget. E CMSD Action Items Strategic Planning Sessions 3) Board and Policies /3.1 Board Meetings Page.5 Issue: Busy, long agendas, sometimes too brief on weighty issues. Action: Consider: a) Incorporating schedule of study sessions for weighty issues requiring discussion. , b) Focus Board meeting as business meeting to accomplish ministerial duties. c) Layout annual schedule. d) Effort by everyone to streamline individual reports. When: Immediately and ongoing. �3.2 Variable Rates Issue: Sewers: Existing program has variable rates but flow Focus Board meeting as business meeting to accomplish meters costly and three water districts to deal with if try to tie to water usage. Trash: Want to implement standardized containers first to establish service levels. Action: Establish goal of adopting more proportionality in the sewer charges and continue studying variable trash rates. j/3.3 Commercial Trash Issue: Numerous commercial haulers under City program; possibly high collection costs, extra traffic due to multiple haulers, more pollution, more wear and tear on streets, missing large franchise fee, etc. Action: Create Fact Sheet CMSD Action Items Strategic Planning Sessions Page 6 Who: Staff to learn more about operations of haulers; how and where they recycle, etc. Board to take advantage of opportunity to explain franchise program to City Council. When: Ongoing action. /3.4 Strategic Plan and Mission Statement Issue: Desire for more thorough planning including mission, vision, values, etc. Action: Report progress regularly of actions outlined in this 010 document. When: Begin Strategic Plan in one year. 4) Public Information /4.1 Increase Public Outreach a 4.2 Inform customers about District, including potential cost pressures to District rates and increases in related services (OCSD). Issue: Is staffing level sufficient to continue creating newsletters, writing press releases, articles, etc.? Action: Consider outsourcing. Who: Staff will prepare a memo w /options and issues. When: April 2001. 5) Staff /Resources 5.1 Is staffing level sufficient? Issue: Review job descriptions, workload, potential new positions. Session with res ect to space see 2.2 Action: Study p p ( ) CMSD Action Items Page 7 Strategic Planning Sessions Consider level of staff necessary to accomplish goals and recommendations. Who: Staff to prepare for Study Session. When: April 2001 meeting — Discuss issues and set Study Session. "re iuvt � Ok Ve--w-o& i- 4full P, hUOJ q cm.6` d e Cat 7 n rauch communication consultants LLC COSTA MESA SANITARY DISTRICT BOARD OF DIRECTORS PLANNING WORKSHOP February 2 -3, 2001 1. THE PUBLIC TRUST • PUBLIC Responsibility Authority Do whatever is necessary Take whatever is necessary Communicat Tell us what you're doing; and why Public Board Staff • C] -2- ® 2. RATING THE DISTRICT (Today) Rating Issue 7 -8 Public Relations -- Do More 8 Services to public -- Need to let people know 5 Collecting Solid Waste -- Need new refuse cans 9 Recycling -- Excellent 7.5 Finance -- Better, changing 8 Staff -- Great job but need job descriptions 7 Capital improvements 8 Operating Reserve -- Need to communicate 8 Finances -- Rates pay operations, well invested 10 Staff 5 Outreach -- haphazard / Press not understand district 9 Infrastructure -- Great problem 10 User friendly 9 Environmental Protection (recycling /leaks controlled) 8 Staff -- Better job descriptions What is optimum staff size? 9 Finance -- Good shape. Concern: trash financial solvency, trash rates 7 Outreach -- Moving right. Need to execute, need identify ourself 9 Recycling -- Could do more e -wgitc 9 AB939 -- Go beyond 50 %? 6 City relations -- Tolerance -- Not really healthy, could do more 7 Facility HQ Space -- Inadequate, need permanent solution 8 Relations other agencies -- Could do more, need more active Board 9 Trash service: good 8 Rates -- Middle, strive to be better 9 Infrastructure 6 Trash costs -- Concern, need to raise rates 6 City relationship: concern 8 Newsletter/ Press: OK • 7 Finance Knowledge -- Need more 9+ Manager -3- 8 Agencies -- lots of action • 9+ Board & Staff 9 Hauler 7+ Transfer 9 Infrastructure 7 Enforcement codes 7 Trash can 6 Sinking fund -- Is there enough? 10 Programs 2 Speed decisions by Board 8 Staff workload -- Overloaded. Need more staff? 3 Office Facility -- Lacking space 4 Board education -- Understanding of role. Need more. 5 Strategic planning 5 Outreach -- Need redouble, more regular newsletters 10 Finance -- All bases covered 6 Meeting length -- Need more efficient meetings, shorter, too tired for tough topics 9 Special programs 10 Board decision making 6 Outreach -- Need more 2 Office 9 Sewer facilities / service 8 Trash -- Good hauler 8 Rates 9 Phone response 10 Board awareness 9 Staff 8 Public awareness 9 Special recycling 10 Board involvement with related government 9 Staff response to Board 10 Education of Board is • n 3. WHAT'S COMING DOWN THE ROAD (Tomorrow) -- 100 year sewer age in 2050 -- Need to increase recycling percent -- Need for proportional billing (sewer) (trash), volume /strength -- Need for Assistant Engineer and overall staff increase -- Biosolids related cost increases -- Future regs and consumer concern = 0 leaks, CMOM -- Need work space /more staff - Methods trash recycling new methods. Stay flexible (10 -15 years) -- Aging population re: carrying trash to street.. . -- Board workload -- Need to move - - -> have own employees -- Educate council, legislators, etc. -- Fully automated collection -- Non -pt. source pollution -- Full secondary? New outfall? Landfill costs? = higher costs -- Air quality regulations on hauler -- AB2838 - - -> new LAFCO powers -- Consolidation -- Energy costs -- Demand on reserves - protect reserves -- Control finances -5- 9 4. EXPECTATIONS (Results From Workshop) -- Strategic Plan - Mission Defines Goals, Measure Success -- Understanding of Direction -- hear everyone's perception and how to achieve -- Break down and examine sewer and trash and confirm quality of each -- Clearer vision of directions and goals -- More awareness of future responsibilities and needs -- Short range and long range goals for 4 or more years i -- Where are we and where are we going? 0 C] in • 5. PRIORITY ISSUES (Agenda For Coming Years) 1) Develop Mission Statement and Strategic Plan ,% 2) Get Fix on Trash Costs -- Ensure Pays Own Way, Proportional Rates ,13) Increase Public Awareness, Tell Story, Prepare for Potential Increases ,14) Move Toward Zero Discharge and Leaks 5) Understand Capital Improvements, Sewer 2050 6) Identify Staff and Resources to Accomplish Goals, Job Description /Workload ,% 7) Fully Automatic Trash Collection ® .f 8) Ensure Reserves Adequate • -,[9) Relocate ? New Facility ? ,110) Investigate Property Tax Issue ,[ 1 1) Identify Increased Costs Early to Mitigate ,[ 12) Number /Length of Meetings ,% 13) Commercial /Multi -Unit Trash ,[ 14) Better Understanding of Finances ,[ 15) Stay Ahead of Electrical Power Crisis IVA Priority Issues, By Category ,J1) Finances Trash costs - Capital improvement costs Reserves ,% - Property taxes ,i - Understand resources -\[ - Electrical power costs 3) Board & Policies ,f - Length Board meetings Variable rates Commercial trash - Strategic Plan - Mission Statement ,/5) Staff /Resources - Job Description - Workload - Consider Treasurer 2) Capital Improvements Facility Zero Discharge Automatic trash collection Mitigate costs Costs of CIP ,[4) Public Info Tell our story Potential increases Inform about whole system OCSD costs, etc. �l • E 0 6. THE DISTRICT'S AGENDA What are we going to do about it?! In 7. ACTION PLAN 1. Define the issue 2. What are we going to do? 3. Who is responsible? - Staff - Consultants :0. 0j 4. When will it be done? 5. How will we do it? - People - Resources < - $ - Time -10- Y • • • f f . L� �5 June 6, 2001 • Robin B Hamers Manager/District Engineer P.O. Box 1200 Costa Mesa, Ca 92628 -1200 Dear Robin: This letter provides the subjective comments you requested on how your District compares to other special districts, particularly sanitary districts. Our comments are based on our observations from the interviews and workshop held on February .1, 2 and 3, 2001, as well as the notes, newsletter and video that you sent. The comments are arranged in the same order they were listed in your letter. Public Outreach In terms of outreach effort, the District certainly appears to be above average when compared to other sanitary districts. We understand the agency publishes a regular newsletter, has prepared other written materials, the video, and many types of flyers and handouts. We suggest a number of comments that may make your outreach effort more effective. Outreach Plan. First, we suggest assuring that the existing outreach plan identifies the pr blems the District is trying to solve, or the goals it is trying to achieve, and is -r coordinated to achieve those goals. For instance, if the District were interested in taking responsibility for commercial garbage service, it would be helpful (unless you are doing this already) to have specific outreach actions aimed at helping achieve that goal. A typical outreach plan would include at least the following three elements: • Step 1 Identify key audiences and develop messages for each group. For instance, residential sewer ratepayers are one obvious audience; it may be desirable (if you have not already done so) to develop materials that appeal directly to other significant audiences, such as commercial trash customers or the City Council. • Step 2. Develop message points. The District already conveys certain key messages. Some picked up from the workshop include: its quality service, its separate identity from the • City, its efficiency, and its low cost. For example, your recent article on residential solid - waste containers helps customers accept the new cans by explaining their value to them and the community. In the future, you may want to demonstrate the efficiencies of a single trash collection service rather than today's multiple services, or ultimately, separation from the city. The point is to continue to focus on message points. • Step 3. Develop an outreach action plan out of the above considerations — including selection of the outreach methods to be used (talks, printed materials, meetings, citizen groups, etc.). Define who does what and when in the plan, and assure adequate resources are available, whether inside the District or hired from outside. The priorities established in the recent planning workshop can help provide direction to the Outreach Plan. Logo. The current logo when printed large is distinctive and the color is attractive. However, when printed smaller, the detail is not readily apparent and it may not be readily recognizable. as the Costa Mesa Sanitary District logo. The District may want to consider developing a logo with less detail. Simple and striking logo designs are easier to see and recall by the public. This step can go a long way toward reinforcing the District's identity. Newsletter. The content of the most recent newsletter sample that you sent is interesting, entertaining and useful. We suggest organizing articles into themes: the benefit of using a theme approach is that it provides the framework on which to "hang" each article. By placing related stories together, under a major headline, it is easier to reinforce message points and help the reader identify the importance of what is being written about. For instance, your Spring 2001 newsletter includes stories on how to dispose of sofas, grass, syringes and grease. A thematic arrangement could bring these same stories together onto a single page with a master headline such as "How to Recycle Unusual Items." Other stories could be tied together similarly. The newsletter style, graphics and story length would otherwise remain the same. Descriptive Title and Paragraph Heads. We would also suggest use of descriptive story titles. A good example of this is the title from your spring newsletter, What Else Can I Do? Reduce, Reuse, Recycle. Such a title can be understood at a glance without even reading the story. Similarly, your C: ,-\I% Documents Winuord`,workshops CostaMesaLet6.4.O1.doc 6'72001 11:26 A11 2 M r recent title The Rollout, could become Nei, Bins Save Alonev acrd Improve Semite. Experience ® tells us that while some customers may not read their newsletters completely, many will glance at or skim them. The current use of brief stories helps readers to skim. More systematic use of descriptive illustrations and story titles would help readers even further. Media and Press Coverage. We are not aware whether the District receives generally positive or negative news coverage. Do you have a basic media relations program to obtain regular positive press coverage? This is easier said than done, but does cultivate press understanding, which can be useful when there is a crisis or major story unfolding. Video. The video is professionally and thoughtfully done and contains a good mix of information. The principal challenge now is to distribute it as widely as possible. We are sure you are working on this aspect. Letters to major community organizations would secure some invitations for the video and /or a speaker. Community Presentation. Another effective way to communicate with active leaders in the community is by making public presentations to established groups such as chambers of commerce, boards of realtors, service clubs, homeowners' associations, and similar organizations. ® Do you do that now? 0 If not, we recommend that the District consider a brief general presentation besides the video in modular form, with content similar to the video. It would have a module containing general information on the District along with other modules on key topics, and a full script that would make it easy for speakers such as Board members to prepare for presentations. Special programs It appears that the District maintains a significant number of special programs. Some that we have noted include: phone book recycling, holiday card recycling, Christmas tree program, sharps programs, and grease control. This is an impressive list. These programs provide many practical benefits and it is clear that the District has already recognized that customers appreciate these types of programs. Special programs serve as excellent opportunities to communicate with customers and stress a positive message about the District, the environment, economy of operation, cost savings, etc. C:�.Nfv Documents'' Winword\ Wor kshops'•CostaMesaLet6.4.01.doc 617/2001 11:26 AM J Overall Level of Service Is The overall level of service appears to be excellent. This assessment is based on the numerous • forward- thinking special programs mentioned above, the good condition of the sewer collection system, attentiveness to maintenance details, and the active outreach program. The District's service standard is set at a high level. Relationship With City One area of concern, in our opinion, is the relationship with the City. The unusual intertwining with the City has resulted in a number of problems outlined in the recent workshop. • Substandard Office Space. The offices are small, and the District is not free to change the situation without the concurrence of the City. Y Diminished Public Recognition. Citizens may not realize that they are visiting an independent agency. We believe the District should take noticeable steps to provide evidence of the District's independent identity. ® Finance: Inadequate finance support. We recommend Costa Mesa Sanitary District consider retaining its own financial officer. The current financial officer may not be in a position to provide completely unbiased counsel, given his larger responsibilities for the city and natural allegiance to the city. This can hinder the District's ability to make independent and timely decisions for the sole benefit of its customers. In summary, the District appears to be well and economically run, well maintained and well managed. You are doing an excellent overall job. Please regard the comments in this memo as subjective, but hopefully useful. Please call if there is anything else we can do to help, or if you have any questions. Regards, arttn auch Rauch Communication Consultants LLC Sent by fax and parcel post. • C': \I% Documents Min word, Workshops Costa \lesaLet6.4.01.doc 6. 7.2001 11:26 ANI 4 December 21, 2001 Phone (714) 754 -5043 Mr. Robert Rauch Rauch Communication Consultants LLC Fax 1086 Diamond Crest (714) 432 -1436 Santa Barbara, CA 93110 Web Address Dear Bob: ivivwc i.costa- inesa.ca.ais As requested in your November 16, 2001 email, enclosed are the following: M rA esa ELY( A %5^ r O Strategic Planning Workshop December 21, 2001 Phone (714) 754 -5043 Mr. Robert Rauch Rauch Communication Consultants LLC Fax 1086 Diamond Crest (714) 432 -1436 Santa Barbara, CA 93110 Web Address Dear Bob: ivivwc i.costa- inesa.ca.ais As requested in your November 16, 2001 email, enclosed are the following: As you will note from the draft agenda, staff is preparing for the February 15 16 Workshop and plans to hold the Saturday, February 16, 2002 session at the Neighborhood Community Center, a short distance from our City Hall location. Board of Directors Arleneschafer Please let me know if you require any additional information and any items Greg Woodside that will be needed for the actual workshop. Art Perry James Ferryman Sincerely Dan Worthington oan Revak Clerk of the District Enclosures Printed on Recycled Paper 1.. Draft Study Session Agenda in preparation for February 15 -16 Strategic Planning Workshop 2. Rauch Communications Workshop Notes from February 2 -3, 2001 Mailing Address Strategic Planning Workshop P. 0. Box 1200 3. Letter from Martin Rauch dated June 6, 2001 Costa Mesa, CA 4. Spring 2001 Newsletter 92628 -1200 5. Fall 2001 Newsletter 6. Advertisements in local paper 7. City of Costa Mesa Recreation Review Publication w /CMSD advertisement 8. Major Emergency Response Plan for 21st Street Pumping Station 9. Master Plan Update Letter from District Manager /Engineer Street 10. Notes and Action Items from February 1 -3, 2001 Strategic Planning 77 Fair- Drive Fair Drive Workshop Costa Mesa, CA 11. CMSD Video and CD, Working For You 92626 -652020 ' 12. CMSD Budget 2001 -2002 As you will note from the draft agenda, staff is preparing for the February 15 16 Workshop and plans to hold the Saturday, February 16, 2002 session at the Neighborhood Community Center, a short distance from our City Hall location. Board of Directors Arleneschafer Please let me know if you require any additional information and any items Greg Woodside that will be needed for the actual workshop. Art Perry James Ferryman Sincerely Dan Worthington oan Revak Clerk of the District Enclosures Printed on Recycled Paper L VAN A RIJRNS [OHN R. HARPER' OF OOLINIRL IML ?AXp(jGCMffgy- 'A P%aFF LV"L LOMRAWM TO: District Manager FROM.- District Counsel LAW OMCES of HARPER & BURNS LLP A LAOR:O LL4ZMrrY DARTC W V INCLLMMG A PRINIMR]NAL CORF 4S3 S. GLASSELL STREET ORAW F, CATJFTIRNIA 971ikf (114)711 TM FAX (714) 744 -3350 DA'1E: December 21, 2001 RE: Selection and 'term of President and Secretary L i D RFVFAP".. / RAN IIFRNAMNO, (909) 674069 The Sanitary District Act of 1923 only provides that at its "first meeting" after the initial organizational meeting after the election establishing the district, the Board shall choose one of its • members as president, and shalt appoint a secretary who may be a member of the Hoard (Attached) Thereafter, all contracts and other documents must be signed by the president and countersigned by the secretary. • Therefore, there is considerable discretion in when the Board takes such action and there is no right to any term of years as president or secretary. Some sanitary districts (as well as cities) actually utilize a rotation system to allow all members a chance to be president for one year. Please advise if you would like further information on this subject aL Alan k Burns District Counsel Cc: Staff TOQ� Xdd T£:£0 T007. /TZ /ZT Pt. 1 OFFICERS § 6489 § 6486. Selection of president and secretary At its first meeting, or as soon thereafter an may be practicable, the board shall choose one of its members as president, and shall ap- point a secretary who may be a member of the board. (Stats.1939, c. 60, P. 644, 16486. Amended by Stats.1945, a 1337, p. 2507. 15.) Hletorloal Not* The amendment of IM added the pro- oarieatlM: 8tsta -WZL C- 171, p. JOL If vision that the secretary may be a mem- 10. ber of the board. Notes of D*olslons 1. to general. The fact that the persona duly elected dared elected, is no ground for question - as the officers of a sanitary district mat, ins In a coUst*ral proceeding their offidal %us ifi*d, and organised before the votes acts done after each canvass. Woodward were canvassed by the board of emmrvi- v. WYnitvele unitary Dist, (INS) 84 P. norm, and before they were ofHdany do- 239,90 C. 55C § 6487. sigaatam on insbwunts All contracts, deeds, warrants, releases, receipts, and -documeab shall be signed in the name of the district by its president, and countersigned by its secretary. (Stats.1939, c- 60, P. 644, 9 6487.) DerivatJ*n: Stats.19M, e. 171, P. 888, S 10. Cron Referenees • Qmtracts defined, see 014 Code § 1549. § 6488. Meetings The board shall hold such meetings, either in the day or in the evening, as may be convenient. In case of the absence or Inability of the president or secretary to act, the board shall choose a president pro tern., or secretary pro tem., or both as the case may be. (Stats.1939, c. 60, p. 644, 1 6488.) Derivatloo: Stata.19M c. 171, p. 389, ! 10. § 6489. Compensatt=; trizvediag espenses Each of the members of the board may .receive not more than forty dollars ($40) for each day of his actual attendance of the meet- ings of the board, such compensation to be established by order of the board and entered upon its minutes. No member of the sanitary board shall, however, receive more than one hundred twenty dollars ($120) In any calendar month. The secretary of the sanitary board 301 t• j RE��IV�i) LAW OFFICES OF JAN HAER & BURNS LLP 8 2 RP 002 A LIMITED LIABILITY PARTNERSHIP MCLUDINGA PROFESSIONAL CORPORATION COSTA MESA SAMiARp DISTRICT 453 S. GLASSELL STREET ALAN R. BURNS ORANGE, CALIFORNIA 92866 RRTRSMF :SAN RFRN'ARD Nn JOHN, R. HARPER* (909) 674.0698 (714) 771 -7728 OFCOUNSEL FAX (714) 744 -3350 X01 A CURTL\+ MICHAEL M0\TG0MERY* •A PROFESSIONAL CORPORATION TO: Board of Directors Costa Mesa Sanitary District FROM: District Counsel DATE: January 16, 2002 RE: Tentative Opinion Issued in Home C'rardens Sanitai) District v City of Corona I am pleased to report that the Court of Appeal has issued a favorable tentative decision in Home Crardens Sanitary District v City of Corona, a case that I handled for the Home Gardens Sanitary District. While it is.still a "tentative "..ruling,. the Court has issued fin_ dings that the parties should not request oral argument (indicating the Court is not likely to change its mind). Most importantly, it holds that a city may generally not interfere with a sanitary district's exercise of its power. The case is a big win for sanitary districts. Unfortunately it is designated as not being "published ", which means it would then become precedent. It might be useful to urge the Court to publish this case and the CSDA or CASA might consider sending a communication to the Court indicating that the decision would provide a useful precedent. a,i, Alan R. Burns City Attorney Cc: District Manager District Staff N NOT TO BE PUBLISHED COURT OF APPEAL, FOURTH DISTRICT DIVISION TWO STATE OF CALIFORNIA HOME GARDENS SANITARY DISTRICT, E029777 Plaintiff and Appellant, u (Super. Ct.No. 347746) TENTATIVE OPINION CITY OF CORONA et al., Defendants and Appellants. APPEALS from the Superior Court of Riverside County. Sharon J. Waters, Judge. Affirmed as modified. Harper & Burns and Alan R. Burns for Plaintiff and Appellant. Best Best & Krieger, Victor L. Wolf and Kevin T. Collins for Defendants and Respondents A sanitary district exercises its statutory authority to construct sewers within its boundaries and to require all property owners to connect to those sewers when they need sewer service. - A city then annexes part of the land within the sanitary district and imposes restrictions on the ability of property owners within the annexed portion of the 1 district to connect to the district's sewers. Does the district have the right to prevent the city from enforcing those restrictions ?. If so, does the district also have the exclusive right to provide sewer services within the common area? The trial court enjoined the city from preventing property owners from connecting to the district's sewers but declared that both agencies had the right to provide sewer service to the area. Both sides appeal. We conclude that the trial court correctly enjoined the city but erred by failing to recognize that the district has exclusive jurisdiction to provide sewer service within its boundaries, including to territory that is also within the city. Accordingly, we modify the judgment to declare that the district has exclusive jurisdiction. FACTUAL AND PROCEDURAL BACKGROUND The Home Gardens Sanitary District ( "District ") is a sanitary district organized and existing pursuant to the Sanitary District Act of 1923. (Health & Saf. Code, § 6400, et seq.) {CT 1, 92, 260) As such, it has the statutory authority to construct and operate sewage collection and treatment facilities. {CT 1, 92, 2601 (Id. at § 6512, subd. (a).) It has provided sewer service to the area in the vicinity of the intersection of Magnolia Avenue and East Sixth Street ( "the Area ") since 1963. {CT 2, 92, 2601 In 1986, the City initiated, and the county's Local Agency Formation Commission ( "LAFCO ") approved, an annexation of unincorporated territory that includes the Area. {CT 2, 92, 106 -107, 260) As a result, the Area is within the territorial jurisdiction of both the District and the City. {CT 2, 92-931 2 Like sanitary districts, cities also have the statutory authority to provide sewer service. {CT 2601 (Gov. Code, § 38900.) During the annexation proceedings before LAFCO, it was noted that the overlapping boundaries of the two agencies would create the potential for the duplication of sewer services. {CT 1101 Although the commission's staff recommended that the City and the District "work together within the next few years to arrive at the best solution for delivering sewer service within the City under a single purveyor" {CT 112, 260}, the commission did not order the two agencies to do so. {CT 106 -107, 260 ) The City and the District did not agree to a single purveyor of sewer services for the Area. Instead, in 1999 the City adopted a policy that property in the Area could connect to the District's sewers only if (1) the property "fronted" on a street with a District sewer line, (2) there was no City sewer line in that street, and (3) the District had entered into an interagency agreement with the City. All other property would be required to connect to the City's sewage collection system, even if some other side of that property adjoined a street with a District sewer. {CT 261, 281 The District sued the City of Corona and its city council (collectively, "City seeking declaratory and injunctive relief and a writ of mandate. {CT 1 -281 After a trial in which the parties submitted evidence solely in the form of written declarations and a request for judicial notice {CT 233}, the trial court found: "The City's unilateral attempt to determine which properties may be serviced by District in the overlapping area was not a valid exercise of the City's police power but was instead an arbitrary, capricious and invalid attempt to usurp District's authority and power to provide sewer service within its territorial boundaries." {CT 2611 Accordingly, the trial court entered a judgment (1) authorizing the issuance of a peremptory writ of mandate that directs the City to set aside its sewer - connection policy as to the Area, (2) permanently enjoining the City from interfering with the District's power to provide sewer service within the District, and (3) declaring that both the District and the City have the right to provide sewer service within the Area. {CT 2561 The'District appeals, challenging only the third portion of the judgment. {CT 262) The City cross - appeals from the judgment, challenging the first and second portions. {CT 2731 ISSUES ON APPEAL Although the parties frame the issues somewhat differently, we understand the principal issues to be three in number: (1) Is the action untimely? (2) Does the City have the right to interfere with the District's exercise of its statutory powers? (3) Does the District have the exclusive right to provide sewer service within the Area? ANALYSIS A. BECAUSE LAFCO MADE NO DECISION REGARDING SEWER SERVICE, THE DISTRICT'S ACTION IS NOT AN UNTIMELY CHALLENGE TO A LAFCO DECISION. The City contends that LAFCO decided that both the City and the District had concurrent jurisdiction to provide sewer service in the Area {RB /AOB 6 -9}, that the in District was challenging that decision, and that the statute of limitations bars any challenge to that decision at this late date. tRB /AOB 6 -10} That argument can succeed only if its factual premise —i.e., that LAFCO decided something about how sewer service would be provided in the Area after the annexation —is true. But as the trial court correctly observed tCT 260 1,LAFCO made no such decision. The City's representation tRB /AOB 10 to the contrary is simply false. Purporting to quote from LAFCO's decision, the City represents that, in the same paragraph that LAFCO "'[r]esolved and determined "' to approve the annexation, LAFCO also found that the "`City and District should resolve this overlap for the long -term benefit of the affected property owners. "' tRB /AOB 10 But an examination of LAFCO's written decision reveals that the latter language is not part of that paragraph or of any other paragraph in that document. ICT 106 -107) Instead, it is language contained in an earlier staff report to the commission, describing staff's recommendations.' tCT 1101 Nothing in the record suggests that LAFCO adopted that recommendation. Nor does any part of LAFCO's short resolution address the issue of sewer service. (CT 106- 1071 Instead, LAFCO ducked the issue by leaving it to the City and the District to resolve. I We remind the City's counsel that such misrepresentations not only violate the rules of ethics (Bus. & Prof. Code, § 6068, subd. (d) [an attorney must never seek to mislead a court by a false statement of fact]; Rules Prof: Conduct, rule 5- 200(B) [same]), they also undermine the credibility of counsel's other assertions, whether of law or fact. 5 LAFCO having made no decisions regarding sewer service, the District's action cannot reasonably be construed as a challenge to a LAFCO decision or otherwise subject to the statute of limitations governing such challenges. Accordingly, the action is timely. B. THE TRIAL COURT DID NOT ERR BY ENJOINING THE CITY FROM INTERFERING WITH THE DISTRICT'S EXERCISE OF THE POWERS CONFERRED UPON THE DISTRICT BY STATE LAW. The fundamental issue is whether the City may use its general police power to override the District's authority to provide sewer service. As the trial court correctly concluded, it may not. The identical issue was raised on substantially similar facts in Rodeo Sanitary Dist. v. Board of Supervisors (1999) 71 Cal.App.4th 1443 ( "Rodeo "). There, two sanitary districts had served unincorporated areas within Contra Costa County for over 50 years by providing solid waste collection and disposal services. (Id. at p. 1445.) In 1991, the county adopted an ordinance requiring anyone performing those services to contract exclusively with the county. (Id. at pp. 1445 - 1446.) The districts sued but the county successfully moved for summary judgment. (Id. at p. 1446.) The court of appeal reversed. (Rodeo, supra, 71 Ca1.App.4th at p. 1455.) As the court explained (id. at p. 1447), our Constitution provides that "[a] county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations," but only to the extent that they are "not in conflict with general law." (Cal. Const., art. XI, § 7.) It is this constitutionally conferred power that is commonly known G as the local government's "police power." (California Rifle & Pistol Assn. v. City of West Hollylvood (1998) 66 Cal.AppAth 1302, 1310.) The scope of the police power of a county or city, although very broad, is nevertheless subordinate to'state law. (Candid Enterprises, Inc. v. Grossmont Union High School Dist. (1985) 39 Cal.3d 878, 885; Birkenfeld v. City of Berkeley (1976) 17 Cal.3d 129, 140.) Accordingly, local regulations that conflict with the general law are void. (IT Corp. v. Solano County Bd, of Supervisors (1991) 1 CalAth 81, 90.) Sanitary districts are created pursuant to state law (Health & Saf. Code, § 6400, et seq.) and are statutorily authorized to collect and dispose of solid waste (id. at § 6518.5). In doing so, "they exercise a portion of the police power of the state within their district boundaries," which is superior to the police powers exercised by cities or counties to the extent that they conflict. (Rodeo, supra, 71 Cal.AppAth at p. 1447.) "Where, as here, a general law of the state grants certain powers to sanitary districts within their boundaries, the county or city may not exercise its police power to override those district powers, because such action would be in conflict with the general laws of the state." (Ibid.) The county's attempt to do so was therefore void. (Id. at pp. 1449- 1450.) The same reasoning applies here. Like the districts in Rodeo, the .District here is a creature of state law and is exercising the authority conferred by state law to collect and treat sewage. (Health & Saf. Code, § 6512, subd. (a).) Any attempt by the City to exercise its police powers in a way that limits the District's statutory authority conflicts with state law and is void. 11 By imposing the various conditions on the District's right to collect sewage within the Area, the City's policy conflicts with Health and Safety Code section 6512, subdivision (a). Accordingly, the policy is void. The trial court did not err by directing the City to vacate its policy and to enjoin the City from interfering with the District's exercise of its statutory authority. In resisting this conclusion, the City makes four arguments. None have merit. First, the City seeks to distinguish Rodeo by arguing that the rule in that case applies only when a city attempts to interfere with a sanitary district's existing sewage- collection operations, and that here "the District is not currently providing sewer service to properties in the overlapping area ...." {RB /AOB 131 That argument fails because its factual. premise is directly contrary to the trial court's express factual finding that "[t]he District has provided sewer service to the overlapping area since 1963." {CT 2601 Not only is that fmding supported by substantial evidence {CT 21, but the City expressly admitted in its answer "that part of the District's sewer trunkline serves the area around where Magnolia Avenue and East Sixth Street come together {CT 92}," i.e., the Area {CT 12). Accordingly, the purported factual distinction does not exist. The City also contends that it is not interfering with the District's authority because the City is not seeking to force any existing connections to the District's sewers to be disconnected. Instead, the City's policy affects only those parcels of property that are not yet connected to any sewer. {RB /AOB 131 This argument also fails, because interference with .previously established sewer service is not the only way in which the City can create a conflict. The uncontradicted evidence here is that the District exercised its statutory authority to provide sewer services by constructing trunk lines in the streets within its boundaries (Health & Saf. Code, § 6518) and by requiring all property within its boundaries to connect to those sewers when they require sewage disposal services (id. at § 6520). {CT 21 The City's policy conflicts with the District's exercise of that authority in the future by attempting to limit the District's ability to connect to parcels of property within the Area that have not previously required sewer services. Relying on City of Fresno v. Pinedole County Water Dist. (1986) 184 Cal.App.3d 840, the City next argues that Rodeo is distinguishable because the area served by the districts in that case was unincorporated, while here the Area was annexed by the City prior to the issuance of the City's policy. {RB /AOB 14 -16) It is mistaken. The result was different in City of Fresno, not because the area in question was within the borders of an incorporated city, but because that city was a chartered city. (City of Fresno at pp. 842, 844 -845.) As Rodeo recognizes, that distinction is critical. (Rodeo, supra, 71 Cal.App.4th at p. 1449.) A city charter may "provide that the city governed thereunder may make and enforce all ordinances and regulations in respect to municipal affairs ...." (Cal. Const., art. XI, § 5, subd. (a).) With respect to its municipal affairs, a chartered city that has adopted a charter with such a "home rule" provision is thereby exempt from the "conflict with general laws" restriction of section 7, article XI, of the state Constitution. (Sherivin- Williams Co. v. City of Los Angeles (1993) 4 CalAth 893, 897, fn. l.) As a result, we "ordinances enacted in a charter city relating to matters which are purely municipal affairs prevail over state laws covering the same subject." (Committee of Seven Thousand v. Superior Court (1988) 45 Cal.3d 491, 505.) General -law cities; by contrast, have no such power to override state law. Because the City is a general -law city,2 the "home- rule" exception has no application here. Finally, the City contends: that, under its police powers, a city may collect and treat sewage; that a city's decision to exercise a police power in a particular way must be sustained if the decision is not arbitrary; and that the City's decision to provide sewer services in the Area is not arbitrary. {RB /AOB 16 -251 That line of reasoning misses the point. While it is true that "[a]n ordinance enacted pursuant to a municipality's police powers may be nullified if palpably unreasonable, arbitrary, or capricious" (Water Resource Technologies v. Department of Public Health (1994) 23 Cal.AppAth 299, 310), that is not the only reason that an attempt to exercise the police power might be invalid. As discussed above, and as the City concedes {RB /AOB 171, a city may exercise its police powers only to the extent that it does not conflict with state law. Therefore, even if the local legislation is otherwise valid, it is preempted and rendered void if it conflicts with state law. (Sher►vin- Williams Co. v. City of Los Angeles, supra, 4 CalAth at p. 897.) 2 Cities within California are classified as either chartered cities or general -law cities. (Gov. Code, §§ 34100 - 34102; G. L. Mezzetta, Inc. v. City ofAmerican Canyon (2000) 78 Ca1.App.4th 1087, 1092.) The City was initially incorporated under the general laws of the state (Deering's Ann. Uncod. Measures (1973 ed.) 1907 -4, p. 21), and it has not asked us to take judicial notice that it ever changed its status by subsequently adopting a charter (see Gov. Code, § 34461). 10 As explained above, the City's policy conflicts with state law by limiting the District's exercise of its statutory powers. Therefore, even assuming that the City's policy were entirely reasonable, it would still be invalid. In summary, because the City's policy conflicts with state law, the policy is void, and the trial court properly directed the City to vacate its policy and enjoined the City from interfering with the District's exercise of its statutory authority. C. THE DISTRICT HAS THE EXCLUSIVE RIGHT TO PROVIDE SEWER SERVICE WITHIN ITS BORDERS. Although the trial court correctly determined that the City could not interfere with the District's exercise of its statutory authority, it nevertheless declared "that the Home Gardens Sanitary District and the City of Corona each have the right to provide sewer service" to the Area. {CT 2561 In its statement of decision, the trial court explained this portion of its judgment by opining that "[t]he statutory and case law submitted by the parties provided no basis to determine that either party has rights superior to the other." {CT 2611 In this, the trial court erred. As explained above, our Constitution provides that state law is superior to local legislation. (Cal. Const., art. XI, § 7.) The District is exercising the power of the state, which prevails over the City's police powers to the extent that they conflict. State law authorizes the District, not only to construct its sewers in any public street (Health & Saf. Code, § 6518), but also to "compel all residents and property owners in the district to connect their houses and habitations and structures requiring sewerage ... disposal service with the sewers ... in [the] streets" (id. at § 6520). Here, the District has constructed those sewers and has adopted that requirement. {CT 2) Its decision that it will be the sole provider of sewer service within its boundaries has the force of state law. Although the City has, under its police power, the authority to provide sewer service to its residents in the absence of any competing authority, it must yield when, as here, the District, as the extension of the state, has decided to exercise exclusive jurisdiction within that portion of the City that is within the District. DISPOSITION The judgment is modified by deleting the third paragraph and by replacing it with the following: "The Home Gardens Sanitary District has the right to prevent the City of Corona from providing sewer service to property within the territorial boundaries of the district to the extent that they overlap with those of the city." As modified, the judgment is affirmed. The District shall recover its costs on appeal. NOT TO BE PUBLISHED. 12 r� u 0 COSTA MESA SANITARY DISTRICT Greg Woodside Vice President Jim Ferryman Director AGENDA Arlene Schafer President T Art Perry Secretary Dan Worthington Director Public Comments. Any member of the public may address the Board. Speakers on agenda items should identify themselves to the Clerk before the meeting so that their input can be provided at the time the item is considered. Speakers on non - agenda items will be heard under Public Comments. Pursuant to State law, the Board may not discuss or take action on non - agenda items except under special circumstances. Speakers must limit their remarks to three minutes or as decided upon by the Presiding Officer. The Presiding Officer reserves the right to declare any speaker out of order. In compliance with ADA, contact Joan Revak, (714) 754- 5087, 48 hours prior to meeting if assistance is needed (28 CFR 35.102.35.104 ADA Title II). Regular Meeting - February 14, 2002 BOARD OF DIRECTORS MEET 2ND THURSDAY OF EACH MONTH - 77 Fair Drive RECOMMENDED ACTION CALL TO ORDER — 6:00 p.m. — Conference Room 5A II. PLEDGE OF ALLEGIANCE — Director Perry III. INVOCATION — Director Woodside IV. ROLL CALL V. CONSENT CALENDAR - All matters listed under the Consent Calendar are considered to be routine and will be enacted in one motion in the form listed below. There will be no separate discussion on these items prior to the time the Board votes on the motion, unless members of the Board, staff, or the public request specific items to be removed from the Consent Calendar for discussion, in which event the item will be removed from the Consent Calendar and considered in its normal sequence on the agenda. Reports Minute Approval • 1. Recycling Committee Meeting — January 8, 2002 2. Investment Oversight Committee Meeting — January 10, 2002 3. Regular Meeting — January 10, 2002 COSTA MESA SANITARY DISTRICT D AFT AGENDA ��Q ill - Manager's Reports If February 14, 2002 Page 2 RECOMMENDED • ACTION 4. Refunds No Refunds 5. Occupancy Report and payment to Costa Mesa Disposal - February 2002 ` Approve 1-M r " � e w F Engineer's Reports 6. Project Status Report Receive and File Treasurer's Reports 7. Financial Report as of January 31, 2002 Accept Report 8. Report of Monies on Deposit as of January 31, 2002 Receive and File 9. Warrant Register for February 2002 in the amount of $ Approve Payment -------------------------------------- - - - - -- -END OF CONSENT CALENDAR --------------------------------------------- VI. WRITTEN COMMUNICATIONS • VII. PUBLIC COMMENTS VIII. MANAGER'S REPORTS A. Anti - Scavenging and Screening of Trash Containers Enforcement Reports Consider B. CMSD Strategic Plan 1. Review of First Year Action Items a) Item 4.1 - Public Outreach Program (1) Circle of Service Award for Nate Reade Consider 2. Development of Strategic Plan a) February 6, 2002 Study Session - hoot,,) Accept Report b) February 15, 2002 Interviews and February 16, 2002 Workshop Consider C. Recycling Reports 1. Waste Diversion Report - December 2001 Receive and File• 2. Waste Diversion Report - January 2002 Receive and File s. s COSTA MESA SANITARY DISTRICT Ri, Fe bruary 14, 2002 AGENDA F Page 3 ® RECOMMENDED ACTION D. Contract Payment to CR Transfer for recycling Approve Subject to services and disposal for January 2002 Verification of Diversion Report by Staff E. Recycling Committee — February 12, 2002 — 9:30 a.m. Director Worthington and President Schafer 1 Standardized Container Program `rAf omn Ste` 601 "Accept Report r �.P,�fTA 2. Telephone Book ecy -dcl g Program Accept Report 3. Christmas Tree Recycling —Final Report Accept Report 4. Greeting Card Recycling' &OmvAl `�" '�'' Accept Report IX. ENGINEER'S REPORTS t� A. Emergency Work Ratify Actions By Manager B. Santa Ana Regional Water Quality Control Board Waste Update Discharge Requirements (I fA C. Project No. 155 — Master Plan Update Progress Report D. Project No. 168 — Tustin Avenue Pumping Station Remodel 1. Proposal to Begin Design Phase Approve Proposal E. 2051 -2053 Newport Boulevard 1. New CMSD Easement Accept Easement 2. Resolution Vacating Existing Easement Adopt Resolution F. Project No. 1112100 -162 — Pilot Program — Use of Enzymes for Grease Consider Regional and Odor Control dish CG r QL�, %/dl'"�lC Study X. TREASURER'S REPORTS XI. ATTORNEY'S REPORTS A. Resolution No. 2002 -654 — Ordering that Publication of Ordinance No. 39 Adopt Resolution Amending the District's Operations Code and Establishing a Local ® Claims Procedure has Occurred B. Mrarangell v. City of-�QCos�tto)I�Mesa and Costa Mesa Sanitary District 1' �r a}� Pr��Gre � (�vfi1�dMU'" Je1.Wv '�1 (�(1i� tecommend C. Home Gardens Sanita District v. Cit of orona (f (� , Letter Sanitary Y To Court from CMSD and CSDA s COSTA MESA SANITARY DISTRICT 4R-7 1F7 February 14, 2002 AGENDA-�-°- - Page 4 RECOMMENDED ACTION XII. LOCAL MEETINGS A. Orange County Sanitation District -04 fa li 'esT "5 �es 11�? 1. Regular Meeting - January 23, 2002 Accept Report 2. Monthly Board Letter Update Consider B. Santa Ana River Flood Protection Agency �r 1. Meeting - January 24, 2002 Accept Report C. Independent Special Districts of Orange County (ISDOC) 1. Quarterly Meeting - Wednesday, January 30, 2002 Accept Report D. Local Agency, Formation Commission (LAFCO) 4S Consider 1. Costa Mesa and Newport Beach Annexations Consider E. Water Advisory Committee of Orange County (WACO) /if Consider F. Orange County Council of Governments (OCCOG) �f Consider • G Chamber of Commerce Legislation Committee 4S Consider H. Orange County Leadership Symposium - Lake Arrowhead January 12 -13, 2002 (President Schafer and Director Ferryman) I. CSDA 1. CSDA Seminar "Practicalities 2002 - Governing Together" — January 24 -25, 2002 - Palm Springs (Art Perry) J. CMSD /City of Costa Mesa /Mesa Consolidated Water District Liaison Committee 1. Meeting - January 23, 2002 (President Schafer, Director Worthington & Manager /District Engineer Rob Hamers) a. Westside Redevelopment Action Committee XIII. OLD BUSINESS XIV. NEW BUSINESS A. SDA Government Affairs Day - Sacramento - March 11, 2002 \..._ A Chamber of Commerce Membership Investment for 4/1/02 to 4/1/03 Accept Report. Consider Accept Report Accept Report Consider Consider Attendals Authorize Payment COSTA MESA SANITARY DISTRICT D RF t A, AGENDA �-� °��`- • XV. ORAL COMMUNICATIONS XVI. ADJOURNMENT • • February 14, 2002 Page 5 RECOMMENDED ACTION