Loading...
Minutes - Board - 2020-04-27COSTA MESA SANITARY DISTRICT MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING APRIL 27, 2020 Note: This meeting was conducted utilizing teleconferencing pursuant to Government code Section 54952.2 and the Govemor's Executive Orders in effect waiving some of the requirements of that Section. Members present Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer Members absent None Staff present Scott Carroll (General Manager), Noelani Middenway (District Clerk & Public Information Officer), Alan Burns (District Counsel), Marc Davis (District Treasurer), Michael Benesh (Interim District Engineer), Kaitlin Tran (Finance Manager), Dyana Bojarski (Administrative Services Manager), Gina Terraneo (Management Analyst II) Others present Yefim Tsalyuk (Robin B. Hamers & Associates) Meeting called to order at 4:30 P.M. A. OPENING ITEMS Procedural: 1. Call to Order — President Ferryman President Ferryman called the meeting to order at 4:30 P.M. Procedural: 2. Pledge of Allegiance — President Ferryman President Ferryman led the Pledge of Allegiance. Procedural: 3. Invocation - Vice President Ooten Vice President Ooten led the Invocation. COSTA MESA SANITARY DISTRICT PAGE 2 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 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.) District Clerk and Public Information Officer, Noelani Middenway, conducted roll call and noted that President Ferryman, Vice President Ooten, Secretary Schafer, Director Scheafer, and Director Perry were present at this time. 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. General Manager, Scott Carroll, stated that the District received late communications from District resident, Jim Mosher. He noted that District staff responded to Mr. Mosher's questions. He added that Mr. Mosher's communications are available to the Board and the public for review. There was no further discussion. Procedural: 6. Ceremonial Matters and Presentations None at this time. B. Public Comments Procedural: 1. Public Comments President Ferryman opened public comments. Ms. Middenway stated that she will read Mr. Mosher's comments for each agenda item. Director Scheafer inquired about Mr. Mosher's comment regarding the District's timeframe for posting meeting agendas. He asked if the District is following the Brown Act's regulations for posting agendas. Ms. Middenway confirmed that the District is posting in accordance with the Brown Act's requirements. She noted that the District posted the current meeting's agenda 72 hours in advance of the meeting date and time. Seeing no one wishing to speak, President Ferryman closed public comments. C. CONSENT CALENDAR Action (Consent): 1. Approve Consent Calendar COSTA MESA SANITARY DISTRICT PAGE 3 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Recommendation: That the Board of Directors approve the Consent Calendar as presented. Action (Consent), Minutes: 2. Approve the Board of Directors Study Session Minutes of March 10, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent), Minutes: 4. Approve the Board of Directors Regular Meeting Minutes of March 23, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action, Action (Consent): 5. Adopt Warrant Resolution No. CMSD 2020-10 Approving District Warrant Registers Recommendation: That the Board of Directors adopt Warrant Resolution No. CMSD 2020-10 approving District warrants for the month of March in the amount of $1,8077755.26. Action (Consent): 6. 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): 7. Payroll Transparency Disclosure for March 2020 Recommendation: That the Board of Directors approve and file the report. Action (Consent): 8. Accept the occupancy count as presented as 22,939 and direct staff to prepare a warrant to CR&R Environmental Services for $237,728.33 for March 2020 collection Recommendation: That the Board of Directors accept the occupancy count as presented using 22,939 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for March 2020 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $237,728.33 to be ratified in the April 2020 warrant list. Action (Consent): 9. Approve the preparation of a warrant to CR Transfer in the amount of $220,412.12 for March 2020 recycling and disposal services to be ratified in the April 2020 warrant register. Recommendation: That the Board of Directors approves the preparation of a warrant to CR Transfer in the amount of $220,412.12 for March 2020 recycling and disposal services to be ratified in the April 2020 warrant register. Mr. Carroll stated that District staff requested to pull Item C3 from the Consent Calendar for discussion. COSTA MESA SANITARY DISTRICT PAGE 4 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Motion: To approve the Consent Calendar, except for Item C3. 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 Action (Consent), Minutes: 3. Approve the Board of Directors Special Meeting Minutes of March 19, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Mr. Carroll stated that a correction to the Board of Directors' Special Meeting Minutes of March 19, 2020 has been made on page 6. He shared that District staff indicated that the meeting adjourned at 9:34 a.m., which is incorrect. Ms. Middenway stated that the Board of Directors' Special Meeting adjourned at 10:10 a.m. Motion: To approve Item C3 with the corrected time of adjournment. 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 Mr. Carroll commented that District staff forgot to add the staff report regarding contracts and purchase orders signed by the General Manager for the month of March 2020 to the Consent Calendar. He noted that May's Regular Board Meeting agenda will include the March 2020 and April 2020 list of contracts and purchase orders signed by the General Manager. There was no further discussion. D. PUBLIC HEARINGS None at this time. E. GENERAL MANAGER'S REPORTS Action: 1. Consider Approving Cal OES Form 130 — Resolution Designating CMSD's Authorized Agents for Requesting Disaster Assistance Recommendation: That the Board of Directors approve Cal OES Form 130 — a universal resolution designating the District's authorized agents as the General Manager and Finance Manger when applying for disaster assistance for up to three (3) years following the date of approval. Management Analyst II, Gina Terraneo, provided report details. She stated that Cal OES Form 130 allows the District to designate the General Manager and COSTA MESA SANITARY DISTRICT PAGE 5 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Finance Manager with the authority to request Federal and State disaster assistance reimbursement on behalf of the District. She noted that the District is preparing for the recovery process of the COVID-19 pandemic by tracking all costs related to the pandemic and submitting all necessary documentation to obtain reimbursement. She added that many of the required forms require an authorized agent. She stated that Cal OES Form 130 designates the District's General Manager and Finance Manager as authorized agents. She noted that if the resolution is approved, then it will remain in effect for the COVID-19 pandemic and all future disasters within the next three years. Director Perry asked if the District has submitted any requests for reimbursement. Ms. Terraneo stated that the District's Finance Department has been preparing all forms necessary for reimbursement. Director Scheafer asked why the District did not already have this form on file with Cal OES and if the District must file this document for every emergency. Ms. Terraneo stated that the District has not required reimbursement for emergency costs in the last three years. She confirmed that this resolution will be in effect for the next three years once it is approved. Motion: To approve Cal OES Form 130 — a universal resolution designating the District's authorized agents as the General Manager and Finance Manger when applying for disaster assistance for up to three (3) years following the date of approval. Motion by Bob Ooten, second by Mike Scheafer. 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 Appointing Two Board Members to Serve on Engineering Services Ad Hoc Committee Recommendation: That the Board of Directors consider approving two Board Members to serve on the Engineering Services Ad Hoc Committee. Mr. Carroll provided report details. He noted that this item was requested by Vice President Ooten and Secretary Schafer to be placed on the agenda for the Board's consideration. He stated that in January 2020, the Board appointed Michael Benesh of Robin Hamers & Associates as the Interim District Engineer. He added that the Board decided to continue engineering services with Robin B. Hamers & Associates for six months. He noted that Vice President Ooten and Secretary Schafer recommended establishing an ad hoc committee to explore all options for the District's engineering services. COSTA MESA SANITARY DISTRICT PAGE 6 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Director Perry nominated Vice President Ooten to serve on the Engineering Services Ad Hoc Committee. Director Scheafer and Secretary Schafer expressed agreement in nominating Vice President Ooten to the committee. Director Perry nominated President Ferryman due to his experience with the Orange County Sanitation District (OCSD). Secretary Schafer expressed agreement with Director Perry's nomination of President Ferryman. She inquired if President Ferryman is available to serve on the committee. President Ferryman confirmed that he is available to serve on the Engineering Services Ad Hoc Committee. Motion: To appoint President Ferryman and Vice President Ooten to serve on the Engineering Services Ad Hoc Committee. 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 further discussion. Action: 3. Consider Approving an Employee Lending Agreement with Orange County Sanitation District and Approving Daniel Lee as the Alternate District Engineer Recommendation: That the Board of Directors approve the following: 1. Employee Lending Agreement with Orange County Sanitation District (OCSD); and 2. OCSD Employee, Daniel Lee, as the District's Alternate District Engineer Mr. Carroll provided report details. He stated that the District has had an Employee Lending Agreement with OCSD for the past six years. He noted that since 2014, Rudy Davila of OCSD served as the Alternate District Engineer. He shared that Rudy Davila has been promoted within OCSD and is no longer available to serve as the Alternate District Engineer. He stated that OCSD has recommended Daniel Lee to assume Mr. Davila's position. He added that Mr. Lee is a licensed professional engineer. He stated that for the District to appoint Mr. Lee as their Alternate District Engineer, the Board needs to adopt a new resolution. He noted that the Employee Lending Agreement has been amended for an additional year. He mentioned that Mr. Lee's hourly pay rate is less than Mr. Davila's rate. He stated that District staff recommends approving the Employee Lending Agreement with OCSD and Resolution No. 2020- 928, which appoints Daniel Lee as the Alternate District Engineer. COSTA MESA SANITARY DISTRICT PAGE 7 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Secretary Schafer expressed her support for the District's partnership with OCSD. Ms. Middenway read aloud Mr. Mosher's written public comments related to Section 3.01.045 of the District's Operations Code. Director Perry asked if District Counsel, Alan Burns, reviewed Mr. Mosher's comments. Mr. Carroll stated that he provided a response to Mr. Mosher. He noted that Section 3.01.045 of the Operations Code was adopted before the District's Employee Lending Agreement with OCSD. He shared that the ordinance was adopted when Bruce Mattern was appointed as the Alternate District Engineer. He noted that the Board approved the ordinance with the intention of having the Alternate District Engineer approve the District Engineer's proposals. He mentioned that the ordinance is not completely relevant to District operations and can be revised to reflect the Employee Lending Agreement. Mr. Burns stated that he believed the procedure was changed because Mr. Carroll believed he had the ability to review engineering proposals. Mr. Carroll stated that he has reviewed engineering proposals for cost purposes. He noted that he compares the costs for design, inspection, and construction. Vice President Ooten suggested that the Policy Review Ad Hoc Committee reviews the ordinance. Mr. Carroll and President Ferryman expressed agreement with Vice President Ooten's suggestion. Director Perry inquired if the Board should hold off on approving the Employee Lending Agreement and Resolution No. 2020-928. Mr. Carroll recommended that the Board proceeds with approval because the current Employee Lending Agreement with OCSD is set to expire next month. Mr. Burns expressed agreement with Mr. Carroll's recommendation. He stated that the District should maintain an active Employee Lending Agreement in case a conflict arises with their current Interim District Engineer. He noted that if the Board requests additional advice on the reasonableness of the agreement, then OCSD and CMSD can amend the agreement. Motion: To approve an Employee Lending Agreement with Orange County Sanitation District and approve Resolution No. 2020-928 to appoint Daniel Lee as the Alternate District Engineer. COSTA MESA SANITARY DISTRICT PAGE 8 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Motion by Arlene Schafer, 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: 4. Consider appointing one member to the Citizens Advisory Committee to fill the vacant one-year term ending in March 2021 and appoint six members to serve a two-year term ending in March 2022. Recommendation: That the Board of Directors appoint one member to the Citizens Advisory Committee to fill on vacancy for the term ending in March 2021 and appoint six members to serve a two-year term ending in March 2022. Ms. Middenway provided report details. She stated that the Board shall consider selecting one of the eight applicants that applied to serve on the District's Citizens Advisory Committee (CAC) to fulfill a one-year term and six other applicants to serve a two-year term that will end in March 2022. She noted that the Board asked District staff to contact two applicants, Daniel Baume and Phil Marsh, to submit information regarding their interest in serving on the CAC. She shared that the applicants' responses have been added to their applications. She asked the Board for their recommendations as to which applicant shall serve the one-year term vacancy. Director Scheafer nominated Leith Speights to fulfill the one-year term vacancy. He recommended Mike Carey, Birger Fernandez, Elodie Katz, Phil Marsh, Andrew Nielson and Seth Greiner fulfill the two-year term vacancies. Motion: To appoint Leith Speights to the Citizens Advisory Committee to fill a one-year term ending in March 2021 and to appoint Mike Carey, Birger Fernandez, Elodie Katz, Phil Marsh, Andrew Nielson, and Seth Greiner to serve a two-year term ending in March 2022. Motion by Mike Scheafer, second by Bob Ooten. Final Resolution: Motion Carries 3-2 Aye: Bob Ooten, Jim Ferryman, Mike Scheafer No: Arlene Schafer, Art Perry Director Perry stated his support for applicant Daniel Baume. He shared that Mr. Baume has an extensive background and is a Costa Mesa resident. He recommended that the Board discusses appointing Mr. Baume to the CAC. President Ferryman stated that he was under the impression that Mr. Baume was included in Director Scheafer's motion. Director Perry, President Ferryman, and Secretary Schafer expressed their support for appointing Daniel Baume to the CAC. COSTA MESA SANITARY DISTRICT PAGE 9 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Mr. Burns inquired if the Board would like to make a motion to reconsider their appointments. Motion: To reconsider appointing one member to the Citizens Advisory Committee to fill one vacancy for the term ending in March 2021 and appoint six members to serve a two-year term ending in March 2022. 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 Director Perry stated that he proposes a motion to nominate Daniel Baume, Mike Carey, Birger Fernandez, Seth Greiner, Phil Marsh, and Andrew Nielson to fulfill the two-year term vacancies. He stated that he would nominate Elodie Katz to fulfill the one-year term vacancy. Director Scheafer inquired who Director Perry did not nominate to the CAC. Director Perry noted that he did not nominate Leith Speights. Director Scheafer asked Mr. Burns about the regulations regarding the recent motions. Mr. Burns stated that the motion to reconsider the appointed nominees has passed and that the Board must recast their vote for appointments. Secretary Schafer commented that all the applicants are good people. She stated that in reviewing each application it is important to consider their experience, availability, and attendance. Director Scheafer stated that the District should not have had to contact the applicants who did not sufficiently complete their application. He noted that he had wished that Mr. Baume filled out a complete application before submitting. He mentioned that because applicant, Phil Marsh, is a returning CAC member, he understands why he did not completely fill out his application. President Ferryman expressed agreement with Director Scheafer's statement. Motion: To appoint Elodie Katz to the Citizens Advisory Committee to fill a one-year term ending in March 2021 and to appoint Daniel Baume, Mike Carey, Birger Fernandez, Seth Greiner, Phil Marsh, and Andrew Nielson to serve a two-year term ending in March 2022. 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 COSTA MESA SANITARY DISTRICT PAGE 10 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 There was no further discussion. Action, Receive and File: 5. Receive and File the Third Quarter Budget Review of FY2019-20. Recommendation: That the Board of Directors receive and file this report. Finance Manager, Kaitlin Tran, provided report details. She stated that as of March 31 St, a total of 64.3% of the Solid Waste Fund has been expended. She noted that District staff anticipates a budgetary savings of $129,300 at the end of the 2019- 2020 fiscal year. She stated that the Personnel budget will have a savings of $62,000. She shared that due to the COVID-19 pandemic, the recruitment process for the Accounting Clerk position has been placed on hold until further notice. She noted that the savings comes from the Salaries and Benefits accounts due to the vacancy of the Accounting Clerk position, staff on leave without pay, and Board salaries. She stated that the Fiscal Services account includes the Auditor and Treasurer budget. She shared that during the absence of the District's Accountant, the District Treasurer assisted the Finance Department with the fiscal year 2018- 2019 audit and the Comprehensive Annual Financial Report (CAFR). She stated that District staff projects that this account will be over budget by $3,000 on June 30th. She noted that the savings from the Salaries and Benefits account will offset the overage. She shared that the Spring Citizens Environmental Protection Academy and the annual Compost Giveaway Event were cancelled due to the COVID-19 pandemic. She added that District staff anticipates a savings of $4,000 from the Public Information/Education/Community Promotion account. She stated that due to the Stay -At -Home order issued by Governor Newsom on March 19th the District purchased software licenses to allow District employees to telework. She noted that the District pays a monthly subscription fee to Zoom to provide video teleconferences. She shared that personal protective equipment and cleaning products were also purchased due to COVID-19. She noted that District staff projects that the Emergency Operations Center (EOC) account will be over budget by $500. She stated that the District is eligible for Federal Emergency Management Agency (FEMA) reimbursement for any costs associated with the COVID-19 pandemic. She shared that District staff is currently tracking all COVID- 19 expenditures and will request FEMA reimbursement. She noted that District staff projects a savings of $10,800 in the Professional Development and Training account. She added that due to the COVID-19 pandemic, several conferences and training sessions have been cancelled. She noted that the Telephone account is projected to be over budget by $1,500 at fiscal year-end. She stated that the District implemented a site replication service with Spectrum Communications in August 2019. She shared that this replication service allows the District Headquarters' servers to be duplicated at the District Yard. She added that the monthly service fee was not included in the Telephone account's budget. She stated that the District installed solar panels at District Headquarters, which reduced the cost of electricity. She noted that District staff anticipates a savings of COSTA MESA SANITARY DISTRICT PAGE 11 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 $900 from the Utilities account. She shared that the amount of organics disposal has increased by 182.78 tons, which is 2.6% higher than 2019's disposal level. She noted that although tonnages have been increasing in the third quarter of the fiscal year, organics disposal is not as high as it was expected overall. She shared that District staff estimates that there will be an increase in tonnages in the fourth quarter, but the account will be within its budget amount by fiscal year-end. She stated that the COVID-19 pandemic affected the District Programs account, and District staff anticipates a savings of $54,000. She noted that the Capital Outlay amended budget is expected to be fully expended. She shared that the District replaced the audio-visual system in the Boardroom in January 2020. She added that computer software and hardware updates and two rooftop air conditioning units at District Headquarters are in progress. She discussed the District's Wastewater fund and stated that a total of 64.5% of the fund's operating budget has been expended as of March 31 St. She noted that overall, District staff anticipates a budgetary savings of $347,700 at fiscal year-end. She added that the Wastewater fund has three vacant positions, which are Accounting Clerk and two Wastewater Maintenance Workers. She stated that the Wastewater Personnel budget will have an estimated savings of $222,000. She mentioned that these savings are from the Salaries and Benefits account, the three staff vacancies, staff leave without pay, and Board salaries. She stated that based on the monthly average, the Engineering Services account is estimated to be under budget by $20,000 by fiscal year-end. She added that the Plan Checking and Inspection account will have an estimated savings of $40,000 due to the recent decrease in new development in Costa Mesa. She noted that COVID-19 has affected the City of Costa Mesa's rate of new development. She commented that the District has been receiving less plans compared to last year and that the anticipated savings of $40,00 will offset the reduced revenue of the Permit Department. She stated that District staff projects that the Fiscal Services account in the Wastewater fund to be over budget by $6,700. She noted that the savings from the Salaries and Benefits account will offset the overage. She added that the Sewer Inspection Rebate Program (SIRP) has a budget of $30,000 and that as of March 31 st, only $8,700 has been reimbursed. She stated that District staff projects the fiscal year- end and total reimbursement to be 50% under budget. She noted that the EOC/Equipment Supplies account of the Wastewater fund is projected to be over budget by $5,400. She added that the Wastewater staff is tracking all COVID-19 purchases and will request for reimbursement from FEMA. She stated that the Professional Development/Training account of the Wastewater Fund has a projected savings of $43,400. She noted that the Wastewater's Telephone account is projected to be over budget by $8,800 at the fiscal year-end due to the site replication service with Spectrum Communications. She added that District staff anticipates a savings of $7,800 from the Wastewater's Utilities account due to the District's installation of solar panels. She stated that the Wastewater's Capital Outlay account is expected to have a savings of $19,000 at fiscal year-end. She noted that the new Vactor truck, the Wastewater Superintendent's truck, and the new utility truck have all been purchased and received. She discussed revenue COSTA MESA SANITARY DISTRICT PAGE 12 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 analysis. She stated that the Solid Waste Annual Charges Revenue account has a budget of $5,166,600. She noted that in August 2019, the total amount placed on the County assessment after corrections were made was less than the amount budgeted. She stated that as of March 31 st, the District has received 64% of its revenue. She added that the District is on target compared to March 31, 2019 with 64% of revenue received. She noted that District staff projects that COVID-19 will not have a major impact on the District's annual charges collected for the current fiscal year. She stated that the Wastewater's Annual Charges Revenue account has a budget of $5,610,000. She noted that in August 2019, the total amount placed on the County assessment after corrections were made was approximately $400 more than the amount budgeted. She stated that as of April 27th, the District has received 96% of the annual charges revenue for the Solid Waste and Wastewater fund from the County of Orange. She discussed property taxes and noted that the District budgeted $320,000 for property tax revenue for the current fiscal year. She shared that the District has received 70% of the property tax revenue as of March 31 st. She noted that in the beginning of the 2019-2020 fiscal year, the property tax revenue was recorded to the General Fund rather than the Solid Waste Fund. She added that during the budget process, the Board approved $270,000 to be transferred to the Solid Waste Fund to help stabilize rates and $50,000 to the Wastewater Fund to contribute to the City of Costa Mesa for portable restrooms at the bridge shelter. She noted that District staff has transferred $143,857 to the Solid Waste Fund and $25,000 to the Wastewater Fund for the first half of the fiscal year. She added that District staff will transfer the remaining balance at the end of the fiscal year. She stated that District staff predicts that the COVID-19 pandemic will not have a major impact on the District's property tax collection. She noted that the Additional Container Charges revenue has a budget account of $110,000. She added that CR&R Environmental Services charges customers directly for the additional container costs and is entitled to 20% of the money collected. She stated that the first and second quarters of the fiscal year have generated $54,281 and that CR&R has received 20% of that amount. She added that the District will be receiving the third quarter's revenue by the end of the current month. She stated that investment earnings are initially recorded in the Solid Waste Fund and allocated to other funds quarterly. She noted that as of March 31 St, the Solid Waste Fund received $51,394 and the Wastewater Fund received $109,650. She stated that the District has received $35,878 from CR&R for education programs. She noted that the CR&R agreed to contribute an additional $19,000 toward the Communication Support and Strategy contract cost, which was not a budgeted item. She shared that the District is expecting to receive the contribution at the end of current fiscal year. She stated that residents of newly developed properties pay a prorated fee for services during the year until they are placed on the County assessment. She noted that the revenue account in the Solid Waste Fund has a budget of $104,000 while the Wastewater fund has a budget of $40,000. She stated that earlier this year, the Board approved two refunds for two property owners who were overcharged for many years for solid waste and wastewater services. She shared that the District has refunded $8,825 from the COSTA MESA SANITARY DISTRICT PAGE 13 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Solid Waste Fund and approximately $6,000 from the Wastewater Fund. She noted that as of March 31 St, the balances are approximately $93,000 in the Solid Waste Fund and approximately $16,000 in the Wastewater Fund. She stated that District staff anticipates that the COVID-19 pandemic will have an impact on the Charges for Services account in both funds for the fourth quarter. She noted that the Sewer Permits revenue account has a budget of $55,000 and that as of March 31st, the District has received $38,420. She shared that the District has been receiving a steady revenue compared to last year's third quarter revenue; however, District staff projects that the District will not receive as much as expected in the fourth quarter due to the COVID-19 pandemic. She stated that the Inspection Fees revenue account has a budget of $125,000 and that as of March 31 St, the District has received approximately $93,000. She noted that the District has been receiving a steady revenue compared to last year's third quarter; however, District staff projects that the District will not receive as much as expected in the fourth quarter. She commented that the savings in the Plan Checking and Inspection expenditure account is a result of the District not receiving plans, collecting fees, issuing inspections, and requiring engineering reviews. She highlighted that the decrease in plans has offset the Inspection Fees revenue account. She noted that the Non -Operating revenue account for the Solid Waste Fund includes grants and other reimbursements. She stated that as of March 31 St, the District has $135,000 in this account. She added that the Wastewater's Non -Operating revenue account has received approximately $104,000. She concluded her report by stating that she is available to answer questions by the Board. Director Perry commented that the District's SIRP distributed less money than it has in the past. He recommended reviewing the program for improvement. He noted that the District may have to prepare for a decrease in income if residents do not pay their property taxes. Vice President Ooten inquired about the District's recourse if residents do not pay their property taxes. Mr. Burns stated that it would be reflected on the assessment roll and it would remain as a charge against the property. He commented that the District will eventually receive their collection unless a property owner's mortgage was completely over -mortgaged and the property had no equity. He added that the District would receive their payment once a bank or the County forecloses on such property. Ms. Tran mentioned that she has been attending webinar trainings which project that property tax will not be affected as much as sales tax from the COVID-19 pandemic. Secretary Schafer and President Ferryman complimented Ms. Tran's report and analysis. COSTA MESA SANITARY DISTRICT PAGE 14 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 The report was received and filed. There was no further discussion. Action, Receive and File: 6. Receive and File the 2020 First Quarter (Jan -Mar) Performance Measurement Final Report. Recommendation: That the Board of Directors receive and file this report. Mr. Carroll provided report details. He stated that this item is a standard quarterly report on the District's Performance Measurement Program, which was implemented in 2018. He noted that the program is a tool to gage performance and to identify areas to enhance and improve. He mentioned that the program has two new measurements, which are the percent of purchase transactions processed through e-commerce (such as PayPal and credit card payments) and the goal of having formal bids awarded by the Board within sixty days. He added that the measurement of achieving 75% diversion from the landfills has been temporarily discontinued. He stated that the Board approved the suspension of recycling reports until the District receives more reliable data. He added that the District has been meeting with CR&R to ensure that the data on recyclables and diversion is accurate. He noted that some measurements will have zero data due to the COVID-19 pandemic, especially measurements for special events. Ms. Middenway read aloud Mr. Mosher's written public comments regarding the report's analysis of community event goals. The report was received and filed. There was no further discussion. Action, Receive and File: 7. Receive and File 2015-2020 Strategic Plan Quarterly Update — FY 2019-20 3rd Quarter. Recommendation: That the Board of Directors receive and file this report. Mr. Carroll provided report details. He stated that District staff is in the process of developing a new 5-year plan for FY 2020-2025. He noted that the District will present the new plan to the Board and the public for comments, suggestions, and edits at a Special Meeting scheduled for Wednesday, May 6, 2020 at 9:30 a.m. Secretary Schafer asked if the Special Meeting will take place via Zoom. Mr. Carroll confirmed that the meeting will be through Zoom. Vice President Ooten inquired about the time of the Special Meeting. COSTA MESA SANITARY DISTRICT PAGE 15 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 President Ferryman clarified that the meeting will take place at 9:30 a.m. There was no further discussion. F. ENGINEER'S REPORTS Action, Receive and File: 1. Receive and File the Monthly Capital Improvements Project Status Report Recommendation: That the Board of Directors receive and file the report. Director Perry stated that he reviewed the report and that he finds it to be accurate. He inquired if Interim District Engineer, Michael Benesh, is in the meeting and if he has any comments for the Board. Mr. Benesh stated that he is present and does not have any comments for the Board. There was no further discussion and the report was received. Action: 2. #324 Brick Manhole Rehabilitation — Accept Improvements as completed, File Notice of Completion, Exonerate Labor and Material Bond 35 Days after Notice of Completion and Exonerate Faithful Performance Bonds Recommendation: That the Board of Directors approves the following actions: 1. Accept improvements as completed and file a Notice of Completion; 2. Exonerate Labor and Material Bond 35 days after Notice of Completion is recorded; and 3. Exonerate Faithful Performance Bond one year after Notice of Completion is recorded. Mr. Benesh provided report details. He stated that the construction of the Capital Improvement Project #324 Brick Manhole Rehabilitation was completed on March 25, 2020; thus, it is appropriate for the District to accept the improvements and file a Notice of Completion. He noted that the project included lining ten existing brick manholes to ensure protection against sulfite corrosion and, to increase the seismic resistance of the brick manholes for another fifty years. Director Perry inquired if he or one of his staff members inspect the final improvements. Mr. Benesh confirmed that his staff inspects the final project. Motion: To accept improvements as completed, file Notice of Completion, 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. COSTA MESA SANITARY DISTRICT PAGE 16 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 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. Action, Receive and File: 3. Receive and File the Mendoza Pump Station Inflow Report Recommendation: That the Board of Directors receive and file the report. Mr. Benesh provided report details. He stated that in October 2019, a smoke test was performed on a portion of the sewer area tributary to the Mendoza Pump Station to identify defects that allowed rainwater to enter the sewer system and as an attempt to identify stormwater inflows. He noted that ADS Environmental Services (ADS) was contracted in December 2019 to install a flow monitor in a manhole near Arlington Drive, north of the Orange County Fairgrounds property. He added that the incoming inflows from the 8-inch sewer main south of the manhole were monitored during the period from December 14, 2019 to March 24, 2020. He stated that the properties connected to the sewer are the Fairgrounds to the south and a lateral to the east along Arlington Drive that runs into the dog park. He noted that during the timeframe when it was monitored, there were four significant rain events and that coinciding with each of these events was a very sizable increase in the sewer flow. He added that District Wastewater maintenance staff performed a dye test on a few drain inlets located on the Fairgrounds property and identified two that were connected to the sewer system. He shared that these two inlets have been filled with concrete. He stated that in reviewing the logs provided by ADS during the month of February, which was the only dry month during the timeframe, the average flow through the meter was 6,800 gallons per day. He noted that the amount of flow measured after each rain event was substantial and it is listed in the report's data table. He mentioned that on December 23, 2019, there was 1.41 inches of rainfall and 120,344 gallons flowed through the manhole. He added that this was 113,544 gallons higher than the average flow. He noted that this peak flow was 0.65 millions of gallons per day (MGD). He stated that on December 25, 2019 there was 1.92 inches of rainfall and 138,232 gallons flowed through the manhole. He highlighted that this was 131,432 higher than the average flow and that the peak flow was 0.54 MGD. He stated that on March 9, 2020 there 0.48 inches of rainfall and 27,187 gallons flowed through the manhole. He noted that this was 20,387 higher than the average flow and that the peak flow was 0.16 MGD. He added that on March 12 and March 13, 2020 there was 1.37 inches of rainfall and 128,903 gallons flowed through the manhole. He noted that this was 122,103 higher than the average amount and that the peak flow was 0.78 MGD. He mentioned that in the ADS report, the peak capacity of the monitored sewer pipe was about 0.65 MGD. He stated that the velocity and flow measured in the pipe indicated it was flowing full and under pressure during the March 12, 2020 rain event. He added that this condition can easily lead to the line COSTA MESA SANITARY DISTRICT PAGE 17 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27,2020 clogging and causing a sewer spill. He highlighted that the ADS report noted that the tributary area necessary to generate this much runoff from these storms would need a minimum of three acres of pavement. He noted that the two storm drain grates connected to the sewer system were in paved areas and may have been the source of a portion of the measured inflow. He stated that the estimates of the areas were about 1.5 acres at most. He added that smoke testing on the Fairgrounds property could locate any additional sources of stormwater inflow into the sewer system. He recommended that the Board receive and file this report and discuss smoke testing on the Fairgrounds property. Director Perry inquired about a solution to the problem. Mr. Burns commented that it is interesting to find that the 0.75 MGD is the entire sewer flow of the Home Gardens Sanitary District, which is a small community of 10,000 people. He expressed concern about the sewer flow being produced by this property. Vice President Ooten shared that he has discussed the matter with OCSD due to their concern for illegal storm drain connections to sanitary systems. He stated that the Fairgrounds property is a small portion of an old army base. He noted that one of the dye -tested storm drains is connected to a sanitary sewer. He recommended receiving an update at the May Board Meeting and that the District smoke tests the area. He noted that OCSD has agreed to potentially help the District locate illegal connections. He discussed the flow measured during the recent rainstorms and noted that the amount of rainfall was minimal compared to previous rainstorms. He stated that he is surprised that the District has yet to have a sanitary sewer overflow (SSO). He recommends that the District treats this issue with the utmost urgency to give ample time for disconnections. He inquired if the connections had been filled with concrete. Mr. Benesh confirmed that the two identified inlets have been filled with concrete. Vice President Ooten recommended performing another inspection and dye test. He stated that he presumes there to be fifteen to twenty illegal connections to generate the amount of flow recorded. He noted that it will be extremely difficult to identify all connections. He recommended that the Interim District Engineer update the Board at their next Study Session meeting so that they can generate a plan to resolve the issues as quickly as possible. Secretary Schafer asked Vice President Ooten if he suggested including this as an agenda item for the May Study Session and inquired about the date of the meeting. Vice President Ooten confirmed that he is requesting the item to be placed on the agenda for the May Study Session. COSTA MESA SANITARY DISTRICT PAGE 18 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Ms. Middenway confirmed that the next Study Session is scheduled for Tuesday, May 12, 2020. Director Perry expressed agreement with Vice President Ooten's statement regarding the amount of illegal connections on the property. Mr. Burns recommended that the Board discusses how to identify and determine the locations of the illegal connections and the volume of flow being produced at the next Study Session. He noted that the District should research how to request a warrant for determining illegal connections. He added that if the connections cannot be diverted to a storm drain, then the District should consider issuing surcharges or increased sewer fees to accommodate the high volume of flow being collected. Vice President Ooten asked Mr. Carroll for his recommendation on who should develop a plan to identify the illegal connections. Mr. Carroll stated that the first step is to smoke test the entire property. President Ferryman expressed agreement in adding the item to the May Study Session for further discussion. Mr. Carroll stated that he will provide a proposal for smoke testing at the May Study Session. Director Scheafer discussed the matter of the City of Costa Mesa housing people at the Fairview Developmental Center and the potential sewer issues that may arise. He recommended that the District prepares for a substantial amount of sewage generated from the Fairview Developmental Center. He added that the District should research the City's plan to develop more housing north of the 405 freeway near the SOCO District. He stated that the City's Planning Commission has been discussing the project. He added that the District needs to be aware of the City's plan and ensure that they have the waste and sewer capability to serve the new development. Mr. Burns inquired if Director Scheafer is referring to the Trinity Property. Director Scheafer clarified that it is not the Trinity Property. He stated that it is located near the SOCO District on Hyland Avenue and Sunflower Avenue. He noted that the project includes a seven -story parking structure and a building complex with 1,200 units. Secretary Schafer stated that she and Vice President Ooten discussed the Fairview Developmental Center with Mr. Carroll at their Monthly General Manager's meeting. COSTA MESA SANITARY DISTRICT PAGE 19 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Ms. Middenway read aloud Mr. Mosher's comments regarding ADS Environment Service's report and the associated staff report. Mr. Burns recommended that the Board address Mr. Mosher's comments at the May Study Session. Secretary Schafer suggested that the District notifies Mr. Mosher of their decision. Mr. Carroll stated that the District has responded to Mr. Mosher and that the Board was given a copy of the District's response. The Board confirmed their decision to discuss District staffs analysis of the Mendoza Pump Station Flow report and Mr. Mosher's comments at the May Study Session. There was no further discussion and the report was received G. TREASURER'S REPORTS Action: 1. Approve the Investment Report for the Month of March 2020 Recommendation: That the Board of Directors approve the Investment Report for the month of March 2020. District Treasurer, Marc Davis, provided report details. He stated that as of March 31 St, the District's portfolio was earning 1.552% on a duration of 616 days, which equals about 1.7 years. He mentioned that at the closing of the current financial markets, the Dow Jones Industrial Average was up 358 points for a total of 24,134 points. He commented that it has been a rough financial quarter. He noted that the Dow Jones opened at the beginning of the year at 28,868 points and reached a high of 29,551 points on February 12, 2020. He added that on March 23, 2020, the Dow Jones dropped to 18,592 points, which was a 37% decrease. He stated that from the 2020 market opening, the Dow Jones is currently down 16%. He discussed the graph on page 10 of the Treasurer's Report. He noted that in February 2020, investment rates dramatically decreased and plummeted down to almost zero. He shared that the 5-year Treasury was earning 1.67% at the beginning of the year, and that today, the 5-year Treasury is earning 0.41 %, which is a 75% decrease in value. He discussed the market's volatility in relation to the District's portfolio. He stated that most of the investments are in fixed income securities and securities tied to the Federal government and Federal agencies. He added that there has been an influx in calls and noted that during March 2020 there were seven investments that were recalled. He shared that the District's portfolio has one security deposit that matured in March 2020 which contributed to a weighted average of 1.8%. He stated that the weighted average dropped to 1.3% due to reinvestments. He added that due to the dramatic drop in rates, the portfolio was shifted away from government agencies and into negotiable certificates of COSTA MESA SANITARY DISTRICT PAGE 20 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 deposit that are within the Federal Deposit Insurance Corporation's (FDIC) insurance limit. He shared that in the foreseeable future, the portfolio's investments that have call features will continue to be called and replaced. He noted that March's activity was the biggest amount of activity that he has ever witnessed while investing the District's funds. Director Perry and President Ferryman expressed support for Mr. Davis' analysis. Motion: To approve the Investment Report for the month of March 2020. Motion by Arlene Schafer, 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. H. ATTORNEY'S REPORTS Mr. Burns stated that he provided information to the Board about a recent case regarding franchise fees. He noted that he does not have a report to present to the Board tonight. There was no discussion. 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 Ooten) Vice President Ooten stated that he did not attend the OCSD meeting and that there was no OCSD Operations Committee meeting for this month. 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director Perry) Director Perry stated that the SARFPA meeting was cancelled. 3. Independent Special Districts of Orange County (ISDOC) - (Secretary Schafer) Secretary Schafer stated that ISDOC discussed the Local Agency Formation Commission's (LAFCO) recent activity and the ISDOC budget process. COSTA MESA SANITARY DISTRICT PAGE 21 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 4. California Special Districts Association (CSDA) - (Secretary Schafer) Secretary Schafer shared that the Legislative Committee for CSDA met on March 9, 2020. She noted that they reviewed a large amount of legislation and added that the State legislators will return on May 10, 2020. She stated that she attended the Finance Committee's meeting for CSDA. She shared that she and Joe McKenzie of CSDA reviewed 13 applications for CSDA's Board of Directors' Seat B. She added that they selected Don Bartz who is a General Manager and involved with CSDA. 5. Special District Risk Management Authority (SDRMA) - (Director Scheafer) Director Scheafer stated that there is nothing to report for SDRMA. He noted that their Board meeting is scheduled for next week. 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 President Ferryman shared that he attended the National Water Research Institute's meeting. He stated that the Institute's General Manager is developing a work plan to present their budget. He added that they discussed the issue of the Institute's employees not receiving a pay raise in the last four years. He shared that he attended the Orange County Council of Governments' (OCCOG) meeting and that they appointed Trevor O'Neil as President and Wendy Bucknum as Vice President. He stated that OCCOG rescheduled the General Assembly for October 9, 2020 at Disneyland and that OCCOG is working on preparing their final budget. He noted that OCCOG discussed separating from the Southern California Association of Governments (SCAG). Secretary Schafer shared that she attended Assemblywoman Cottie Petrie -Norris' Facebook meeting. She added that Congressman's Harley Rouda attended the meeting. She stated that they discussed the Taxpayer's Association's legislation. She shared that she attended the Costa Mesa Chamber of Commerce's Government Affairs meeting. She noted that they discussed recent legislation and election activity. Director Perry stated that he attended Assemblywoman Petrie -Norris' and Congressman Rouda's video conference meeting and noted that Costa Mesa will be receiving $668,000 in funding from the Federal government. He added that the representatives reported that COVID-19 cases will increase in mid -May. He shared that he attended the District's Policy Review Ad Hoc Committee meeting and that the Committee completed their review of all District policies. He stated that he attended a Costa Mesa City Council meeting in which they discussed the Lighthouse Church, which serves 26 homeless individuals. He noted that the COSTA MESA SANITARY DISTRICT PAGE 22 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 organization has placed 28 homeless individuals in hotels. He added that the City of Costa Mesa will be receiving ten RV trailers to house the homeless. Secretary Schafer asked Director Perry if the District's Policy Review Ad Hoc Committee will be presenting their policy changes to the Board. Director Perry noted that it will most likely be presented at a future Study Session. He inquired if Administrative Services Manager, Dyana Bojarski, is updating the policies with the Committee's revisions. Ms. Bojarski confirmed that she and District staff are working on including the revisions and that it will be presented to the Board for approval. Mr. Carroll confirmed that District staff will present the final documents at the June Study Session for discussion and at the June Regular Board Meeting for approval. Mr. Burns requested to receive the final versions of the policies to review the District ordinances before it is submitted for Board approval. Vice President Ooten inquired if the Costa Mesa City Council has made progress on the second homeless shelter. Director Perry stated that the City Council is waiting to review the shelter's construction plans. He noted that they requested $3 million from the County of Orange to help fund the homeless shelter. There was no further discussion. 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 Secretary Schafer inquired about attending CSDA workshops in August 2020. Mr. Carroll stated that he is waiting to receive more information. He noted that CSDA officially cancelled the General Manager's Summit that was scheduled for June 2020 in Lake Tahoe. COSTA MESA SANITARY DISTRICT PAGE23 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD APRIL 27, 2020 Secretary Schafer inquired about attending CSDA's Legislative Days. Mr. Carroll stated that the event will be held via video conferencing and that he is waiting to receive more information. There was no further discussion. M. ADJOURN TO CLOSED SESSION No closed session. N. RECONVENE TO OPEN SESSION AND REPORT OF ACTION TAKEN No closed session. O. CLOSING ITEMS Procedural: 1. Adjourn President Ferryman adjourned the meeting at 6:07 P.M. J#4es Ferryman Pkdsident