Minutes - Board - 2014-01-23COSTA MESA SANITARY DISTRICT
MINUTES OF BOARD OF DIRECTORS REGULAR MEETING
JANUARY 23, 2014
CALL TO ORDER The Board of Directors of the Costa Mesa
Sanitary District met in regular session on
January 23, 2014 at 5:30P.M. at 1845 Park
Avenue, Costa Mesa.
PLEDGE OF President Ferryman led the Pledge of
ALLEGIANCE Allegiance.
INVOCATION
Vice President Scheafer led the Invocation.
ROLL CALL DIRECTORS PRESENT: James Ferryman, Robert Ooten, Art Perry,
Arlene Schafer. Mike Scheafer
DIRECTORS ABSENT: None
STAFF PRESENT: Scott Carroll, General Manager; Colin Burns,
Deputy District Counsel; Robin Hamers,
District Engineer; Noelani Middenway,
District Clerk; Marc Davis, District Treasurer;
Wendy Davis, Interim Finance Manager
OTHERS PRESENT: Nltln Patel, White Nelson Diehl Evans, LLP,
Dean Ruffridge, CR &R; Mike Silva, CR &R
CEREMONIAL MATTERS AND PRESENTATIONS - None
ANNOUNCEMENT OF LATE COMMUNICATIONS - General Manager Carroll Indicated that Mr.
Jim Mosher had submitted written public comments and they were provided to the
Board for review.
PUBLIC COMMENTS - President Ferryman invited members of the public to address the
Board.
COSTA MESA SANITARY DISTRICT
MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING
HELD JANUARY 23, 2014
Seeing no one, President Ferryman closed public comments.
CONSENT CALENDAR
1. Board of Directors Special Meeting
Minutes of December 9. 2013
2. Board of Directors Study Session
Meeting Minutes of December 10,
2013
PAGE 2
The Board of Directors Special Meeting
Minutes of December 9, 2013, was
approved as presented.
The Board of Directors Study Session
Meeting Minutes of December 10, 2013,
was approved as presented.
3. Board of Directors Regular Meeting This item was pulled for discussion.
Minutes of December 19, 2013
4. Occupancy report and payment to
Costa Mesa Disposal
5. Contract Payment to CR Transfer
for Recycling and Disposal Services
6. Adoption of a Warrant Resolution
No. CMSD 2014 -7 Approving
District Warrant Registers
7. Directors' Compensation and
Reimbursement of Expenses
8. Fiscal Year 2011 -12 Annual
Compliance Report for
Requirements of Government Code
Section 66013 for Capacity
Charges
9. Fiscal Year 2012 -13 Annual
Compliance Report for
Requirements of Government Code
The Board of Directors approved the
occupancy report and payment to Costa
Mesa Disposal for the month of December
2013.
The Board of Directors approved payment
to CR Transfer for recycling and disposal
services for the month of December 2013.
The Board of Directors approved adoption
of Warrant Resolution No. CMSD 2014 -7
Approving District Warrant Registers for
the month of December 2013 in the
amount of $1,030,150.26.
The Board of Directors approved Directors'
compensation and reimbursement of
expenses for the month of December
2013.
The Board of Directors received and filed
the Fiscal Year 2011 -12 Annual
Compliance Report for Requirements of
Government Code Section 66013 for
Capacity Charges as presented.
The Board of Directors received and filed
the Fiscal Year 2012 -13 Annual
Compliance Report for Requirements of
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Section 66013 for Capacity Government Code Section 66013 for
Charges Capacity Charges as presented.
10.Annual Report of Expenses — Fiscal The Board of Directors accepted the
Year 2012 -13 Annual Report of Expenses for Fiscal Year
2012 -13 as presented.
END OF CONSENT CALENDAR
Vice President Scheafer moved for approval of the Consent Calendar with the exception
of Item 3 that was pulled for discussion. Director Schafer seconded the motion.
MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes:
Ferryman, Scheafer, Perry, Ooten, Schafer
Noes:
None
Absent:
None
Abstain:
None
Regarding Item No. 3, Director Ooten noted a typographical error and clarified that there
are 20 pump stations, not 27 pump stations as the minutes indicated.
Director Ooten moved to approve Item No. 3. Director Schafer seconded the motion.
MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes:
Ferryman, Scheafer, Perry, Ooten, Schafer
Noes:
None
Absent:
None
Abstain:
None
PUBLIC HEARINGS - None
GENERAL MANAGER'S REPORTS
11. Financial Statements for Fiscal Year Ended June 30, 2013
Recommendation: That the Board of Directors receive and file the
Comprehensive Annual Financial Report, auditors' report in accordance with
Government Auditing Standards, and the auditors' required communication for
the fiscal year ended June 30, 2013.
General Manager Carroll introduced the item and deferred to Mr. Marc Davis, District
Treasurer, to provide report details.
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Mr. Davis noted that the audited financial statements, the auditors' report in accordance
with Government Auditing Standards, and the auditors' required communication for the
fiscal year ended June 30, 2013 has been presented to the Board and introduced Mr.
Nitin Patel of White Nelson Diehl Evans, LLP who provided details of the audit results of
the year.
Mr. Patel presented the audit results and reviewed the sections of the audit opinion. Mr.
Patel noted that there were no difficulties in performing the audit, the adjustments made
to the material were not material in the financial reporting process, and there were no
disagreements with management.
There were no questions or comments and the report was received.
12. Environmental Review — Organics Recycling Program
Recommendation: That the Board of Directors concurs with finding that the
activity is not a "project," but if it is, that it is entitled to an exemption pursuant
to CEQA GuidelinesSection 15038.
General Manager Carroll introduced the item and deferred to Mr. Robin Hamers, District
Engineer, to report the environmental review findings.
District Engineer Hamers reported on the findings of the environmental review of the
proposed collection and transportation of the organics and noted that the findings is an
analysis of the potential changes to the District's program and is not an opinion for or
against the organics recycling program. Mr. Hamers noted that there is no change in the
tonnage being collected by the District; however, the existing waste collection is being
redistributed in order for organics to be processed at CR &R's plant in Perris, CA. It was
noted that one additional truck would be added to CR &R's fleet of hauler vehicles and
would add an additional 415 miles driven within the District's service area. Mr. Hamers
discussed the creation of renewable natural gas (RNG) as the byproduct of the organics
recycling process and noted that RNG will be utilized by the CR &R fleet; highlighted that
10,000 tons per year would be diverted from the landfill and recycled at the Perris plant,
which would move the District closer to reaching its goal of reaching a 75% diversion
rate.
Director Ooten noted that the 10,000 tons of waste being diverted to the Perris facility
will reduce the amount of methane produced in the landfill, thus creating a positive
impact on the environment.
Vice President Scheafer requested clarification of the timeline for filing the CEQA
exemption and asked if denial of the CEQA exemption would impact the organics
recycling program from moving forward.
District Engineer Hamers noted that staffs recommendation is that the Board find under
CEQA that the organics recycling program is not a project under CEQA due to the
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minimal changes to the environment that would occur with the additional truck and
additional mileage. Mr. Hamers indicated that if the filing for CEQA exemption is denied,
that it would not impact the Board's decision in finding that the organics recycling
program is not a project.
Mr. Colin Burns, Deputy District Counsel, noted that he agreed with the analysis that
District Engineer Hamers had provided to the Board.
President Ferryman invited members of the public to address the Board regarding this
item.
Mr. Jim Mosher provided public comment and noted a discrepancy in the stated
additional mileage to be incurred.
Vice President Scheafer moved to approve staff's recommendation. Director Perry
seconded the motion.
Mr. Phil Morello, Costa Mesa rental property owner and resident, spoke in opposition of
the impacts that the organics recycling program will have on the streets.
Ms. Gail Carson Hedrick, Costa Mesa resident, spoke in favor of the organics recycling
program.
Ms. Beth Refakes, Costa Mesa resident, spoke in favor of holding additional Town Hall
meetings and expressed concern regarding the organics recycling program.
President Ferryman invited Mr. Dean Ruffridge, CR &R, to respond to public comment.
Mr. Ruffridge addressed the concern of the increased number of carts, explained the
breakdown of the additional miles incurred, and commented on the concerns of odors
and attracting animals and transients.
District Engineer Hamers responded to President Ferryman's question and clarified that
the District services properties with more than four units on a case by case basis and is
reviewed by the District, the City, and CR &R.
General Manager Carroll noted that 18% of the 21,000 residences that the District
services are multi - family units of four units and that the District services a small number
of more than four units.
Director Perry expressed support of holding additional Town Hall meetings.
General Manager Carroll confirmed that a minimum of three additional Town Hall
meetings would be held regarding the organics recycling program.
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MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes:
Ferryman, Scheafer, Perry, Ooten, Schafer
Noes:
None
Absent:
None
Abstain:
None
13. CR &R Environmental Services 2nd Amendment to Exclusive Franchise
Agreement — Recommendations from Performance Audit and Organics
Recycling Program
Recommendation: That the Board of Directors considers one of the following:
1. Approves the 2nd Amendment to the exclusive franchise agreement with
CR &R Environmental Services; or
2. Direct staff to organize additional Town Hall meetings and report back to
the Board on February 27, 2014.
General Manager Carroll noted that a detailed report of the performance audit results
had been provided to the Board; discussed the organics recycling program and
addressed concerns regarding odors from the organics; discussed the $500,000 annual
cost increase and options to fund the increase in cost; noted that the rate for the
anaerobic digestive (AD) facility is the lowest rate offered by CR &R and it is guaranteed
that if another agency were to receive a lower rate that the District would receive the
same low rate; noted that residents can opt out of the program on a case by case basis.
Mr. Carroll indicated that he had received emails from members of the public both in
support and opposition of the organics recycling program and had provided said emails
to the Board for review.
General Manager Carroll responded to President Ferryman's question and noted that it
is projected that the State will repeal the use of green waste as alternative daily cover
and the District is being proactive in finding an alternative to recycle green waste while
securing the most favorable rate.
President Ferryman invited members of the public to address the Board.
Mr. Morello expressed concern regarding the program and the additional carts.
Ms. Bonnie Winslow, Costa Mesa resident, spoke in favor of recycling and of holding
additional Town Hall meetings; expressed concern regarding the public's health and the
tightness of the organics cart lids.
Ms. Flo Martin, Costa Mesa resident, expressed support of the organics recycling
program.
Mr. Ron Amburgey, Costa Mesa resident, inquired if the Board had considered creating
sites throughout the City for residents to dispose of green waste and expressed support
of not entering into a permanent contract.
Seeing no one further, President Ferryman closed public comments.
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Vice President Scheafer expressed support of the organics recycling program and of
obtaining the lowest favorable rate. Vice President Scheafer expressed support of
holding additional Town Hall meetings before the Board taking action.
Director Schafer concurred with Vice President Scheafer.
Director Ooten suggested that staff review and respond to the publics questions from all
of the workshops and to provide a handout on the frequently asked questions as a
handout at the workshops; discussed the financial impact of the District waiting to
approve the program; expressed support of not delaying the decision for more than a
month; and supported extra time for the District to educate the public on the program.
Director Perry agreed with Director Ooten and felt it important to educate the public.
General Manager Carroll noted that Vice President Scheafer would not be in attendance
of the February 27 Board meeting and provided options of rescheduling the date of the
February meeting or to hold additional workshops and place this item on the March
agenda.
President Ferryman expressed interest in changing the February board meeting date.
Discussion followed.
Deputy District Counsel Burns confirmed that the Board could change the date of the
February meeting.
General Manager Carroll suggested changing the meeting day to Tuesday, February
25.
The Board agreed to change the meeting date to February 25, 2014.
Vice President Scheafer moved to direct staff to organize additional Town Hall meetings
as necessary and to change the Thursday, February 27 Board meeting date to
Tuesday, February 25. Director Schafer seconded the motion.
Discussion followed.
MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes:
Ferryman, Scheafer, Perry, Ooten, Schafer
Noes:
None
Absent:
None
Abstain:
None
14. Sponsorships: Costa Mesa Community Run & 7 t Annual Gala of the Estancia &
TeWinkle Schools Foundation
Recommendation: That the Board of Directors considers:
1. Sponsoring the Costa Mesa Community Run at the $1,000 level.
2. Placing half page ad space in the Gala's Program at $100.
General Manager Carroll presented the item and noted that the Board had indicated at
its study session of January 14 that it felt that sponsorship of the Costa Mesa
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Community Run and the 7`" annual Gala of the Estancia and TeWinkle Schools
Foundation met the District's purpose by promoting the District's solid waste and sewer
program. General Manager Carroll noted that nearly eighty percent of 1,000 Community
Run participants are Costa Mesa residents; noted that there are up to 200 attendees of
the Gala and recommended placing a half page ad in the Gala's program advertising
the District's programs.
Vice President Scheafer expressed interest in promoting the District's 70th anniversary
in the ad.
Director Perry moved to approve staff's recommendation. Vice President Scheafer
seconded the motion.
Director Ooten requested that staff provide, at the Board's February study session, a
prioritized list of programs to be promoted.
General Manager Carroll noted that he will provide a presentation at the Chamber
Breakfast highlighting all of the District's programs.
MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes:
Ferryman, Scheafer, Perry, Ooten, Schafer
Noes:
None
Absent:
None
Abstain:
None
ENGINEER'S REPORTS
15. Project Status Report
Recommendation: That the Board of Directors receive and file the report.
In response to Director Perry's question, District Engineer Hamers confirmed that the
project status reports before the Board had not changed since the item was presented
at the January 14 study session meeting.
There were no additional questions or comments and the report was received.
16. Project #199 — Proposed OCSD Transfer of Fairview Trunk to CMSD — Status
Report
Recommendation: That the Board of Directors considers:
1. Respectively declining the transfer of OCSD Fairview Trunk at this time, but
leave open the possibility that CMSD would likely accept transfer of the trunk
should OCSD rehabilitate the trunk to CMSD standards.
2. Notify the Home Ranch property owners of the resolution of the matter and
explain the various sewer connection possibilities.
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3. Direct staff to provide future updates to the Board of Directors regarding
events affecting the Fairview Trunk.
District Engineer Hamers noted that this item was discussed at the January 14 study
session; indicated that the staff report is in agreement with all that was discussed; and
offered to respond to questions from the Board.
In response to Director Perry's question, District Engineer Hamers noted that the
proposed letter to OCSD declining the transfer of the Fairview Trunk had been included
in the agenda report.
Director Ooten moved to approve items 1, 2 and 3 of staff's recommendation. Director
Schafer seconded the motion.
MOTION CARRIED BY THE FOLLOWING VOTE:
Ayes: Ferryman, Scheafer, Perry, Ooten, Schafer
Noes: None
Absent: None
Abstain: None
TREASURER'S REPORTS
17. Investment Report for the Month of December 2013
Recommendation: That the Board of Directors approves the Investment Report
for the month of December 2013.
Mr. Marc Davis, District Treasurer, provided a report on the District's quarterly
investments.
There were no questions or comments and the report was received
ATTORNEY'S REPORTS - None
Vice President Scheafer requested clarification regarding the Brown Act's requirement
of identifying each Board Members vote for the record.
General Manager Carroll noted that District Counsel had provided a memo regarding
the new requirement and that the District is in compliance.
LOCAL MEETINGS
A. Orange County Sanitation District (OCSD) — (President Ferryman)
Recommendation: That the Board of Directors accepts oral report.
President Ferryman reported on his attendance of the meeting and
discussed the hiring of a consultant to conduct negotiations with the union,
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and reported on the settlement of litigations.
B. Santa Ana River Flood Protection Agency (SARFPA) — (Secretary Perry)
Recommendation: That the Board of Directors accepts oral report.
Director Perry reported on his attendance of the SARFPA meeting with
President Ferryman, noted that the main line of the SARI line is scheduled
for completion by June of 2014 and that the main street projects are
scheduled for completion in 2016. Director Perry noted that the SARFPA
Board approved representatives to go to Washington D.C. to request
additional funds for the SARI line.
C. Independent Special Districts of Orange County ( ISDOC) — (Vice President
Scheafer)
Recommendation: That the Board of Directors accepts oral report.
Vice President Scheafer reported on his attendance of the ISDOC Executive
Committee, discussed CSDA grants and LAFCO vacancies, and noted that
the ISDOC quarterly meeting would be held on January 30.
D. California Special Districts Association (CSDA) - (Vice President Scheafer)
Recommendation: That the Board of Directors accepts oral report.
Vice President Scheafer reported on his attendance of the CSDA
Membership and Education Committees in Sacramento.
E. California Association of Sanitation Agencies (CASA)
Recommendation: That the Board of Directors accepts oral report.
Director Ooten reported on his attendance of the CASA conference with
Director Perry, discussed the presentation on inflow and infiltration, and
reported on a presentation from OCSD on their internship program.
Director Perry suggested inviting other City officials to the organics recycling
program workshops.
F. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No.
55, Operations Code Section 3.01.030
Recommendation: That the Board of Directors accepts oral report.
Director Schafer reported on her attendance of the District's 70th Anniversary
Committee meeting, study session, the City /Districts Liaison meeting, Town Hall
meeting, and Board meeting.
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Vice President Scheafer noted that he attended his first meeting as a Board
member of the Special District's Risk Management Authority (SDRMA) and
indicated that the District receives credits for completed safety courses.
OLD BUSINESS — None
NEW BUSINESS — None
ORAL COMMUNICATIONS AND DIRECTOR COMMENTS
Vice President Scheafer expressed appreciation of staff's sentiments for the loss of his
father in law.
Director Perry announced that Estancia High School is hosting a game versus Mesa
High on February 5 and will recognize former athletes.
President Ferryman thanked staff for a job well done on coordinating the offsite Board
meeting.
ADJOURNMENT
There being no further business to come before the Board, President Ferryman
adjourned the meeting at 7:20 p.m.
Art Perry
Secretary
J es Ferryman
esident