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Minutes - Board - 2018-07-26 - RevisedCOSTA MESA SANITARY DISTRICT REVISED MINUTES OF BOARD OF DIRECTORS REGULAR MEETING JULY 26, 2018 Members present Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer Members absent None Staff present Noelani Middenway (District Clerk), Steve Hodges (Finance Manager), Alan Burns (District Counsel), Marc Davis (District Treasurer), Robin Hamers (District Engineer), Gina Terraneo (Management Analyst II) Others present Deborah Diep (Cal State Fullerton Center for Demographic Research), Jim Mosher (resident), Sue Lester (Citizens Advisory Committee Member), Luke Money (Daily Pilot) Meeting called to order at 5:29 P.M. A. OPENING ITEMS Procedural: 1. Call to Order - President Scheafer President Scheafer called the meeting to order at 5:29 P.M. Procedural: 2. Pledge of Allegiance - President Scheafer President Scheafer led the Pledge of Allegiance. Procedural: 3. Invocation - Vice President Ferryman Vice President Ferryman led the invocation. Procedural: 4. 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.) COSTA MESA SANITARY DISTRICT PAGE 2 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 District Clerk, Noelani Middenway, conducted roll call and all Board Members were present. Procedural: 5. Announcement of Late Communications - Unless directed otherwise by the Board of Directors, all actions shall be based on/memorialized by the latest document submitted as a late communication. District Counsel, Alan Burns, noted that a resolution and ordinance were submitted to the Board of Directors for consideration during the public hearing. He noted that copies were provided for the Board of Directors and for the public. Director Perry asked if the resolution should contain a number. Mr. Burns replied that the District Clerk will provide a resolution number. Procedural: 6. Ceremonial Matters and Presentations None at this time. B. Public Comments - This time has been set aside for persons in the audience to make comments on items within the subject matter jurisdiction of the Costa Mesa Sanitary District that are not listed on this agenda. Members of the public will have the opportunity to address the Board of Directors about all other items on this agenda at the time those items are considered. Under the provisions of the Brown Act, the Board of Directors is prohibited from taking action on oral requests but may refer the matter to staff or to a subsequent meeting. The Board of Directors will respond after public comment has been received. Please state your name. Each speaker will be limited to four (4) continuous minutes. Procedural: 1. Public Comments President Scheafer opened public comments. Seeing no one wishing to speak, he closed public comments. C. CONSENT CALENDAR - All matters listed on the consent calendar are considered to be routine and may be acted upon by one motion after public comment has been received. Only Board of Directors may pull an item for discussion. Reading of resolutions is waived and they will be adopted and numbered. Now is the time for those in the audience who wish to speak to items listed on the consent calendar. Each speaker will be limited to four (4) continuous minutes of comment on the consent calendar as a whole. Action (Consent): 1. Approve Consent Calendar Recommendation: That the Board of Directors approve the Consent Calendar as presented. COSTA MESA SANITARY DISTRICT PAGE 3 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 262 2018 Action (Consent): 2. Approve the Board of Directors Special Meeting Minutes of June 6, 2018 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent): 3. Approve the Board of Directors Study Session Minutes of June 12,2018 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent): 4. Approve the Board of Directors Regular Meeting Minutes of June 28, 2018 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent): 5. Approve the Directors' Compensation and Reimbursement of Expenses Recommendation: That the Board of Directors approve the compensation and reimbursement of expenses as presented. Action (Consent): 6. Accept the occupancy count as presented as 22,602 and direct staff to prepare a warrant to CR&R Environmental Services for $221,395.63 for June 2018 collection Recommendation: That the Board of Directors accept the occupancy count as presented using 22,602 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for June 2018 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $221,395.63 to be ratified in the July 2018 warrant list. Action (Consent): 7. Approve the preparation of a warrant to CR Transfer in the amount of $215,681.74 for June 2018 recycling and disposal services in the July 2018 warrant register Recommendation: That the Board of Directors approves the preparation of a warrant to CR Transfer in the amount of $215,681.74 for June 2018 recycling and disposal services to be ratified in the July 2018 warrant register. Action (Consent): 8. Adopt Warrant Resolution No. CMSD 2019-1 Approving District Warrant Registers Recommendation: That the Board of Directors adopt Warrant Resolution No. CMSD 2019-1 approving District warrants for the month of June 2018 in the amount of $758,699.62. Action (Consent): 9. Approve Payroll Transparency Disclosure for June 2018 Recommendation: That the Board of Directors approve and file the report. Action (Consent): 10. Receive and File Closed Circuit Television (CCTV) Sewer Lateral Assistance Program Report COSTA MESA SANITARY DISTRICT PAGE 4 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 Recommendation: That the Board of Directors receive and file the report. Action (Consent): 11. Citizens Advisory Committee (CAC) 2018 Work Plan, Goals and Objectives Recommendation: That the Board of Directors approve the 2018 work plan, goals and objectives recommended by the Citizens Advisory Committee. Motion: That the Board of Directors approve the Consent Calendar as presented. Motion by Art Perry, second by Arlene Schafer. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no discussion or comments. D. PUBLIC HEARINGS Procedural: 1. Open Public Hearing President Scheafer opened the public hearing. Presentation: 2. Receive a Presentation from Demographer, Deborah Diep, Director of Center for Demographic Research, on the Voting Rights Act and the District's Existing Conditions, Receive Input Regarding Potential Transition to By -District Elections, and Release of Public Participation Kit Mr. Burns provided a presentation about the federal and state Voting Rights Acts. He noted that the California Voting Rights Act made it easier to successfully challenge a government entity by showing that racially polarized voting occurs. He added that the at -large voting method is presumed to be unlawful in California and that racially polarized voting can be proven by showing that a protected group would vote differently than the majority. Mr. Burns commented that allegations of racially polarized voting are difficult and expensive to fight. He noted that the District was challenged by attorney, Kevin Shenkman. Mr. Burns then noted that the Board of Directors adopted a Resolution of Intent in order to further study the issue and consider changing from an at -large to by -district voting method. He noted that the Board of Directors are being asked to consider approving a final division map, an ordinance, and a resolution to change the District's electoral system from at -large to by -district. Mr. Burns added that if the Board of Directors approves the recommended action, Mr. Shenkman's attorney's fees will be capped at $32,000. President Scheafer commented that the City of Costa Mesa asked the public to vote on the matter when they transitioned to by -district voting. He noted that residents have asked him why the District is not having the public vote on the matter. COSTA MESA SANITARY DISTRICT PAGE 5 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 Mr. Burns replied that special districts are specifically authorized not to have to go to a public vote on this matter. He noted that the District does not need to go to a public vote, because they passed a Resolution of Intent and went through the safe harbor process. Demographer, Deborah Diep, Director of Center for Demographic Research, provided an overview of the districting process thus far. She noted that since receiving the letter alleging racially polarized voting from Mr. Shenkman, the District has entered the safe harbor process and the Board of Directors has collected comments from the public about the matter. She described the past public hearings and noted that today is the final public hearing, where the Board of Directors is being asked to adopt an ordinance and select a final division map. Ms. Diep noted that the Citizens Advisory Committee (CAC) recommended maintaining the existing staggered election sequencing, where 2 divisions would be up for election in 2020 and 3 divisions would be up for election in 2022. She noted that 6 division plans (maps) were submitted to the District for consideration and she explained that there is a 10% maximum population spread threshold in order for a plan to be considered viable. Ms. Diep added that Plans D and E exceeded the 10% threshold; however, Plan E was near the threshold and it was revised to make it viable. She then provided an overview of all division plans and shared each of their population spreads: Plan A (8.34%), Plan B (5.00%), Plan C (3.28%), Plan D (33.11 %), Plan E (12.58%), Plan F (4.12%), and Plan E Revision 1 (3.55%). Ms. Diep reviewed and provided examples of the redistricting criteria, which include a population spread of under 10% and considerations of topography, geography, cohesiveness, and communities of interest. She shared the CAC's recommendation to sequence the elections with the existing staggered terms of the Board of Directors, where the odd numbered divisions would be up for election in 2020 and the even numbered divisions would be up for election in 2022, and to select Plan B. She noted that the Board of Directors is being asked to consider the adoption of an ordinance that corresponds with their selected division map and election sequencing at tonight's meeting. She noted that division map and sequencing would not be implemented until the November 2020 election. Ms. Diep noted that the districting information will be provided to the Orange County Registrar of Voters and that it is a "best practice" to reanalyze the division boundaries after each decennial census. She noted that the next decennial census data will be made available in April of 2021. Ms. Diep welcomed questions and comments. Procedural: 3. Receive Public Comments President Scheafer asked that Ms. Diep explain how population spreads are determined. Ms. Diep provided examples of absolute value to demonstrate population spread. President Scheafer asked if citizenship or ethnicity is factored into the decennial census population data. COSTA MESA SANITARY DISTRICT PAGE 6 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 Ms. Diep noted that the decennial census data does not take into account citizenship and ethnicity. President Scheafer expressed concern that the District will have to analyze the division boundaries again when the next decennial census data is released in 2021. He commented that different areas within the District's service area will see different rates of population growth over time, making it difficult to anticipate changes in population. Additionally, he commented that the Board of Directors will need to be cognizant of the fact that there will be growth in certain divisions that may impact their population spread. Ms. Diep commented that if the Board of Directors anticipates that a particular division will see population growth, it may make sense to select a plan in which that division has a lower population spread in order to account for potential growth. She reiterated that the District is not required to reanalyze the division boundaries after each decennial census; however, it is a best practice. President Scheafer commented that the Board of Directors should attempt to anticipate potential growth, because it will cost the ratepayers more money if the District ends up having to change the division maps again after the next decennial census. Assistant Secretary Ooten commented that he reviewed the City of Costa Mesa's voting districts and noticed a high degree of variation in the number of registered voters between a few of the districts. He asked if the Board of Directors will find out how many registered voters are in each division after they select a division map. Ms. Diep explained that the Citizen Voting Age Population (CVAP) by Race and Ethnicity is provided as a five-year average from 2012-2016. She noted that the number of registered voters is a different data set that can be provided by the Orange County Registrar of Voters if a division map is provided to them. District Engineer, Robin Hamers, commented that the District's service area saw an increase in the development of new housing, which may be slowing now that the developments have been built. President Scheafer noted that the decennial census data is from 2010 and it may not have captured the increase in development. He opened public comments. Jim Mosher, a resident, commented that he is not entirely convinced that switching to by -district elections is correct. He commented that the language within the proposed resolution appears ambivalent toward the idea of switching to a by -district election system in order to further the California Voting Rights Act, since it states that the Board of Directors are not of the opinion that there is a problem with the voting. He suggested that this language be removed, because it COSTA MESA SANITARY DISTRICT PAGE 7 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY26, 2018 may cause the District to be challenged further. Mr. Mosher commented that a section of the ordinance seems like it includes boiler plate language that could be simplified to avoid redundancy. He noted that an Exhibit A was mentioned but not included with the ordinance. Lastly, he commented that he is uncomfortable with the section that gives the District Clerk the authority to make technical adjustments to the map and noted that there are some grammatical errors in the ordinance. Sue Lester, Citizens Advisory Committee Member and resident, noted that she is not here to officially represent the CAC. She commented that she hopes that the Board of Directors approve the CAC's recommendation of Plan B, because this is the plan that they unanimously recommended based on the time that they took to review all of the proposed plans. She indicated concern about the consideration of new developments and noted that the CAC was not given this information to factor into their recommendation. Ms. Lester commented that she does not think that the Board of Directors should attempt to foresee population growth due to new developments. She commented that she is disappointed that the Board of Directors have not yet commented on the recommendation of the CAC (Plan B) and shared any indication of which plan they are in favor of. She noted that the Board of Directors were not allowed to comment on the proposed plans during the public hearings held during CAC meetings, but she noted that the Board of Directors could have provided comments during the public hearings that were joint Board of Directors and CAC meetings. Ms. Lester noted that she is speaking for herself (and not on behalf of the CAC) and commented that it would be frustrating and disheartening if the Board of Directors selected an entirely different plan without having given the CAC input or provided comments during the plan assessment process. She asked that the Board of Directors take this into consideration going forward and commented that she trusts that the Board of Directors will do what is best for the District as a whole. President Scheafer closed public comments. In response to Mr. Mosher's comments, Mr. Burns noted that the resolution makes a finding that the Board of Directors does not believe that voter dilution is occurring under the at -large election system. President Scheafer commented that the districting process has been frustrating because of the limited timeframe that the District was given to address the issue. He expressed gratitude to the CAC and to Ms. Diep for the work they have done and the information they have provided. He commented that the process should have taken 6 months or more and that it was unfair to have only had 90 days to study the issue. He noted that he did not want the District to make the same mistake that the City of Costa Mesa made. He commented that all of the submitted plans are workable, except for Plan D (due to its high population spread), but noted that he is primarily concerned with the population spread of the plans. He commented that he would like to keep the population spread as low as possible in order to account for future population growth and noted that Plan B COSTA MESA SANITARY DISTRICT PAGE 8 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 does not have the lowest population spread. He noted that Plan C has the lowest population spread, but commented that he sees potential problems with Division 5. He indicated support for Plan E Revision 1, because it has a low population spread and it would accommodate future population growth. Director Perry commented that the Board of Directors are not going to do what the City of Costa Mesa did. He commented that he attended the City's workshops and felt that the City Council did not consider the public's input. He noted that the CAC submitted all of the proposed plans and that the Board of Directors did not have any say in the design of the plans. He indicated that he is not in support of the CAC's recommendation, because it seems to split up neighborhoods. He added that he is happy with the assistance that the CAC has provided. Assistant Secretary Ooten noted that he utilized the Plan Discussion Worksheet to rank the proposed plans and found that Plans B, C, and E Revision 1 were his top ranked plans. Secretary Schafer noted that she attended all of the public hearings and commented that it was good to have so many maps to choose from. She indicated that she does not support Plan B, because she does not want to see the neighborhoods broken up. She commented that Plan E Revision 1 seemed more balanced and she thinks that the public would be happier with it. Vice President Ferryman commented that the districting timeline was ridiculous and shared that analyzing the population and demographic information was intimidating for a novice. He noted that the Board of Directors were not permitted to provide input during most of the public hearings. Director Perry indicated support for Plans C and E Revision 1. There were no further comments or discussion. Procedural: 4. Close Public Hearing President Scheafer closed the public hearing. Action: 5. An Ordinance/Resolution of the Board of Directors of the Costa Mesa Sanitary District to Change the District's Electoral System from At -Large to By - District with Respect to Electing Directors, Establishing Boundaries and Scheduling Elections within the District Recommendation: That the Board of Directors consider approving a final map and sequencing for By -District Elections. Mr. Burns noted that the Board of Directors is being asked to adopt the resolution first, which will give them authority to adopt the ordinance. He added that the Board of Directors will then adopt a map (plan). COSTA MESA SANITARY DISTRICT PAGE 9 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY26, 2018 Ms. Diep noted that the division numbers will be determined with District staff once the final plan is selected. She noted that the plan will become Exhibit A in the ordinance. Mr. Burns noted that the Board of Directors will adopt the division boundaries tonight, but that the numbering of the divisions may be changed by District staff. Ms. Diep reiterated that the Board of Directors is being asked to consider approving sequencing the elections with the existing staggered terms of the Board of Directors, where the odd numbered divisions will be up for election in 2020 and the even numbered divisions will be up for election in 2022. Motion: To approve a resolution authorizing the Board of Directors to declare a change in the method of electing directors in the furtherance of the purposes of the California Voting Rights Act of 2001 and to approve a division map without a vote of the people. Motion by Arlene Schafer, second by Art Perry. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer Motion: To approve Plan E Revision 1 and to approve sequencing the elections with the existing staggered terms of the Board of Directors, where theadd-even numbered divisions will be up for election in 2020 and the -c numbered divisions will be up for election in 2022. Motion by Mike Scheafer, second by Arlene Schafer. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no further discussion. E. GENERAL MANAGER'S REPORTS Action: 1. Consider Contribution Program Application for Newport -Mesa Schools Foundation's State of the Schools Breakfast Recommendation: That the Board of Directors: 1. Establish the purpose CMSD is trying to serve as a contributor to the Newport -Mesa Schools Foundation; and 2. Describe how the expenditures will advance CMSD's purpose; and 3. Consider contributing $1,000 for the State of the Schools Breakfast. Management Analyst Il, Gina Terraneo, provided details regarding the Contribution Program Application request for monetary support for the Newport - Mesa Schools Foundation's State of the Schools Breakfast. She provided the event details, the available sponsorship levels, and the level of support that the District provided in 2017. She noted that in order for the Board of Directors to approve the sponsorship, they must describe how the expenditures will advance COSTA MESA SANITARY DISTRICT PAGE 10 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 the District's purpose and establish the purpose that the District is trying to serve as a contributor. Director Perry commented that he likes the inclusion of VIP parking in the recommended sponsorship level, since parking was difficult during previous years of the event. He asked how much the District contributed in 2017. Ms. Terraneo responded that the District contributed $1,000 in 2017 and noted that the District's logo was displayed in various locations during the event. Director Perry noted that he would like to attend the event if the Board of Directors approves this contribution. President Scheafer commented that this is an opportunity to further promote the Alkaline Battery Recycling Program within the school district. Discussion followed regarding including Corona Del Mar High School and other Newport -Mesa Unified School District (NMUSD) schools in the Alkaline Battery Recycling Program. Motion: To contribute $1,000 to the Newport -Mesa Schools Foundation's State of the Schools Breakfast for the purpose of increasing District visibility and promoting the Alkaline Battery Recycling Program. Motion by Art Perry, second by Bob Ooten. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no further discussion. Action: 2. Consider Contribution Program Application for Estancia & TeWinkle Schools Foundation 2018 Annual Gala Recommendation: That the Board of Directors: 1. Establish the purpose CMSD is trying to serve as a sponsor to the Estancia & TeWinkle Schools Foundation 2018 Annual "Light Up The Night" Gala; and 2. Describe how the expenditure will advance CMSD's purpose; and 3. Consider being a Bronze Sponsor and contribute $500 to the Estancia & TeWinkle Schools Foundation for the 2018 "Light Up the Night" Gala. Ms. Terraneo provided details regarding the Contribution Program Application request for monetary support for the Estancia TeWinkle Foundation's 2018 Annual Gala. She provided the event details, the available sponsorship levels, the level of support that the District provided in 2017, and an overview of the Foundation's purpose. She noted that in order for the Board of Directors to approve the sponsorship, they must describe how the expenditure will advance the District's purpose and establish the purpose that the District is trying to serve as a contributor. COSTA MESA SANITARY DISTRICT PAGE 11 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY26, 2018 Secretary Schafer indicated support for providing the sponsorship and commented that the sponsorship was successful last year. Motion: To approve a Bronze Sponsor and contribute $500 to the Estancia & TeWinkle Schools Foundation for the 2018 "Light Up the Night" Gala in order to increase District visibility and promote the Alkaline Battery Recycling Program. Motion by Arlene Schafer, second by Bob Ooten. Final Resolution: Motion Carries 4-0-1 Aye: Arlene Schafer, Bob Ooten, Jim Ferryman, Mike Scheafer Abstain: Art Perry There was no further discussion. Action: 3. Receive and File 2015-20 Strategic Plan Quarterly Update - 4th Quarter Recommendation: That the Board of Directors receive and files this report. Finance Manager, Steve Hodges, presented report details and welcomed questions. Director Perry asked how the District is progressing towards its 75% landfill diversion goal. Mr. Hodges noted that this topic will be discussed further during the next item, but he noted that the tonnage of organic material collected has decreased due to a lack of rain. He noted that the District's landfill diversion percentage remains the same. Director Perry asked if the current diversion rate includes Orange Coast College Recycling Center's (OCCRC) data. Ms. Terraneo confirmed that the District's diversion rate includes OCCRC's data. Discussion followed regarding future planning to address the diversion rate. There was no further discussion and the Board of Directors received the report. Action: 4. Receive and File Prelim 4th Quarter Budget Review for FY2017-18 Recommendation: That the Board of Directors receive and file this report. Mr. Hodges presented report details. He noted that the budget numbers are not final yet, but added that the auditors will provide a full report of the final numbers in October. He noted that the District is approximately $275,000 under budget in the Solid Waste Fund and reiterated that organics tonnages are down 12% in the last quarter. Additionally, Mr. Hodges noted that the District is about $800,000 under budget in the Wastewater Fund and provided updates regarding outstanding capital projects. COSTA MESA SANITARY DISTRICT PAGE 12 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 Secretary Schafer asked when the solar project will be completed. Mr. Hodges responded that he is unsure, but noted that the project should begin shortly. President Scheafer asked that District staff obtain an update on the solar project timeline. Assistant Secretary Ooten requested the projected deficit in the Solid Waste Fund. Mr. Hodges noted that staff made a conservative estimate of approximately $600,000-$700,000. He noted that the District will be conducting a Solid Waste Rate Study soon. Secretary Schafer asked how much the District has in reserves. Mr. Hodges responded that the reserves are healthy and noted that an update will be given after the Fiscal Year 2017-2018 numbers are finalized. Secretary Schafer commented that the reserves were essential to the purchase of the District's new headquarters. Mr. Hodges noted that the District still does not have any debt. Assistant Secretary Ooten noted that the Board of Directors need to discuss the solid waste rates further. Discussion followed regarding the upcoming Solid Waste Rate Study. There was no further discussion and the Board of Directors received the report. Action: 5. Consider Approving Modifications to the CCTV Program including enhanced Public Outreach Recommendation: That the Board of Directors considers adopting the recommended changes to the program. 1. Change the name of the program to "Sewer Inspection Rebate Program", or SIRP, to better grab the attention and understanding of our residents. 2. Modify the program to provide reimbursement directly to the homeowner vs. the contractor 3. Modify the program to offer rebates up to $250 for a CCTV or up to $500 to install a two-way clean -out (not eligible for both) 4. Create online application form to ease process and help monitor available funds 5. Enhance social media presence by establishing "Nextdoor" account to directly target specific neighborhoods 6. Increase advertising in newsletter by including details in every issue until conclusion of the program COSTA MESA SANITARY DISTRICT PAGE 13 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 7. Advertise program via banner on the side of CR&R trucks 8. Include mailer inside Mesa Water monthly billings to market program(cheaper than doing individual mailings ourselves) Mr. Hodges provided an overview of District staffs recommendations for expanding outreach and making changes to the CCTV Program. He noted that the program will include offering residents a $500 rebate for the installation of a two-way clean -out. Director Perry asked when the program will be made available to residents. Mr. Hodges noted that the program will be available after the Board of Directors approves of the recommended changes. Director Perry suggested that the program information be distributed at the Lions Club Fish Fry event. President Scheafer indicated support for the two-way clean -out rebate and commented that he thinks it will resonate with people. He asked if staff reached out to CR&R regarding advertising the program on their trash trucks. Mr. Hodges noted that CR&R's trash trucks can be used and noted other methods of advertising the program, such as printing advertisements on Mesa Water District's bill inserts. President Scheafer indicated support for advertising through bill inserts and CR&R truck signs. Motion: To adopt the following recommended changes to the program: 1. Change the name of the program to "Sewer Inspection Rebate Program", or SIRP, to better grab the attention and understanding of our residents. 2. Modify the program to provide reimbursement directly to the homeowner vs. the contractor 3. Modify the program to offer rebates up to $250 for a CCTV or up to $500 to install a two-way clean -out (not eligible for both) 4. Create online application form to ease process and help monitor available funds 5. Enhance social media presence by establishing "Nextdoor" account to directly target specific neighborhoods 6. Increase advertising in newsletter by including details in every issue until conclusion of the program 7. Advertise program via banner on the side of CR&R trucks 8. Include mailer inside Mesa Water monthly billings to market program(cheaper than doing individual mailings ourselves) Motion by Art Perry, second by Bob Ooten. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer COSTA MESA SANITARY DISTRICT PAGE 14 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY26, 2018 There was no further discussion. Action: 6. Update Plan Check and Inspection Fees Recommendation: Approve Resolution No. 2018-909 adopting revised and establishing new user fees for plan check, inspection, permit and annexation services. Mr. Hodges provided an overview of the updated plan check and inspection fees. He noted that a fee was added for grease interceptors. Director Perry asked what the grease interceptor fee is for. Mr. Hodges noted that the fee covers the cost of the grease interceptor inspection. District Engineer, Robin Harriers, commented that the additional grease interceptor fee is appropriate. Motion: To approve Resolution No. 2018-909 adopting revised and establishing new user fees for plan check, inspection, permit and annexation services. Motion by Bob Ooten, second by Arlene Schafer. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no further discussion. F. ENGINEER'S REPORTS Receive and File: 1. Receive and File Monthly Capital Improvement Projects Status Report Recommendation: That the Board of Directors receive and file the report. Mr. Harriers presented the report. He noted that the Corporate Yard Expansion project is complete and that the President Pump Station Reconstruction Project is out to bid as of yesterday. Additionally, he noted that Phase 11 of the Grade 5 Project and the Canyon Pump Station Projects will be going out to bid soon. Director Perry asked what Phase 11 of the Grade 5 Project will include. Mr. Harriers explained that Phase 11 of the Grade 5 Project will include repairing 5 deteriorated manhole bottoms and 1 line. He added that this is the last phase of Grade 5 repairs under the current approved funding. Discussion followed regarding remaining Grade 5 Projects. There was no further discussion and the report was received. COSTA MESA SANITARY DISTRICT PAGE 15 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY26, 2018 Action: 2. #325 Corporate Yard Expansion - Accept Improvements, File Notice of Completion, Exonerate Bonds Recommendation: The Board of Directors approves the following action: 1. Accept improvements as completed and file a Notice of Completion. 2. Authorize payment of 5% retention 35 days after Notice of Completion is recorded. 3. Exonerate Labor and Material Bond 35 days after Notice of Completion is recorded and exonerate Faithful Performance Bond one year after Notice of Completion is recorded. Mr. Harriers noted that the recommended actions are the normal procedures for finalizing a project. He added that the lettering on the perimeter wall has been completed. President Scheafer complimented the lettering. Motion: To approve the following actions: 1. Accept improvements as completed and file a Notice of Completion. 2. Authorize payment of 5% retention 35 days after Notice of Completion is recorded. 3. Exonerate Labor and Material Bond 35 days after Notice of Completion is recorded and exonerate Faithful Performance Bond one year after Notice of Completion is recorded. Motion by Art Perry, second by Jim Ferryman. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer Discussion followed regarding the project's progress. There was no further discussion. G. TREASURER'S REPORTS Action: 1. Investment Report for the Month of June 2018 Recommendation: That the Board of Directors approve the Investment Report for the month of June 2018. District Treasurer, Marc Davis, presented the Investment Report. He noted that as of June 30, 2018 the portfolio was earning 1.676% and had a duration of about 1.75 years. Discussion followed regarding concern over trade and tariffs. Motion: To approve the Investment Report for the month of June 2018. Motion by Bob Ooten, second by Art Perry. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer COSTA MESA SANITARY DISTRICT PAGE 16 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 There was no further discussion. Action: 2. Resolution 2018-910 Approving the Statement of Investment Policy and Delegating the Investment Function to the Treasurer for Fiscal Year 2018-19 Recommendation: That the Board of Directors adopt Resolution 2018-910 approving the Statement of Investment Policy and delegating the investment function to the Treasurer for Fiscal Year 2018-19. Mr. Davis noted that the investment function is the responsibility of the Board of Directors, but that the Board of Directors can delegate the function for a period of a year through the adoption of a resolution. He noted that the proposed resolution delegates the function to the District Treasurer and it does not contain any substantive changes from the prior resolution. Motion: To adopt Resolution 2018-910 approving the Statement of Investment Policy and delegating the investment function to the Treasurer for Fiscal Year 2018-19. Motion by Art Perry, second by Arlene Schafer. Final Resolution: Motion Carries 5-0 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no discussion. H. ATTORNEYS REPORTS Mr. Burns provided information about a case involving President Trump's use of social media. He also provided information regarding updates to the mass mailing restrictions for elected officials. President Scheafer thanked Mr. Burns for his work regarding the settlement agreement with Mesa Water District. He noted that Mr. Burns' counsel was integral to the District's success in this matter. I. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day's service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. 1. Orange County Sanitation District (OCSD) - (Vice President Ferryman) Vice President Ferryman noted that the OCSD meeting was short and shared that OCSD has a 99% safety rating. He shared that he will be hosting a COSTA MESA SANITARY DISTRICT PAGE 17 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 retirement party for Bob Ghirelli and noted that he got elected as the OCSD representative for SARFPA. 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director Perry) Director Perry noted that there was no SARFPA meeting. 3. Independent Special Districts of Orange County (ISDOC) - (President Scheafer) President Scheafer noted that he will sit down with District staff to go over the approved ISDOC dues. He also shared that they received a final report from Local Agency Formation Commission (LAFCO) Director, John Withers. Lastly, he added that he received compliments from those who attended General Manager, Scott Carroll's presentation at CSDA's General Manager Leadership Summit in Lake Tahoe. Secretary Schafer noted that ISDOC is having nominations for the Executive Committee. 4. California Special Districts Association (CSDA) - (Secretary Schafer) Secretary Schafer discussed CSDA elections and noted that a workshop will be hosted in Costa Mesa on September 5, 2018. She shared that she attended a Chamber of Commerce meeting at the Orange County Fairgrounds and noted that CSDA's Annual Conference is coming up. President Scheafer noted that the Board of Directors were not invited to Costa Mesa Day at the Orange County Fair this year. 5. Special District Risk Management Authority (SDRMA) - (President Scheafer) President Scheafer noted that there was no SDRMA meeting; however, SDRMA is working on narrowing down the list of candidates for their new CEO. 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 Director Perry shared that he attended the past few Costa Mesa City Council Meetings. He noted that the Costa Mesa Historical Society is selling historical photos for $50 each and suggested purchasing any historical photos pertaining to the Costa Mesa Sanitary District. Lastly, he shared that a resident attempted to report a hazardous leak in the storm drains to the City of Costa Mesa and no one responded. He noted that he suggested that this resident call the District if this happens again. Director Perry asked if this is something that the District's wastewater crew could assist residents with in these types of situations. COSTA MESA SANITARY DISTRICT PAGE 18 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JULY 26, 2018 Discussion followed regarding other agencies that should be notified in this situation and how the District could respond. J. OLD BUSINESS None at this time. K. NEW BUSINESS None at this time. L. ORAL COMMUNICATIONS AND DIRECTOR COMMENTS Discussion: 1. Oral Communications and Director Comments President Scheafer commented that the District's new process of logging all trash issues into GovOutreach seems to be working. He noted that he has not been contacted with any trash related issues lately. M. ADJOURN TO CLOSED SESSION None at this time. N. RECONVENE TO OPEN SESSION None at this time. O. CLOSING ITEMS Procedural: 1. Adjourn President Scheafer adjourned the meeting at 7:21 P.M. Arlene Schafer Michael Sche Secretary ' President