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Minutes - Board - 2020-06-22COSTA MESA SANITARY DISTRICT MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING JUNE 22, 2020 Note: This meeting was conducted utilizing teleconferencing pursuant to Government code Section 54952.2 and the Governor'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 None Meeting called to order at 4:30 P.M. A. OPENING ITEMS Procedural: 1. Call to Order — Vice President Ooten Vice President Ooten observed a minute of silence in memory of President Ferryman's late son, Ryan Ferryman. He called the meeting to order at 4:30 P.M. Procedural: 2. Pledge of Allegiance — Vice President Ooten Vice President Ooten led the Pledge of Allegiance. Procedural: 3. Invocation — Director Scheafer Director Scheafer led the Invocation. COSTA MESA SANITARY DISTRICT PAGE 2 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 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. Ms. Middenway stated that the District received late communications from District resident, Jim Mosher. She added that Mr. Mosher's comments were disseminated to the Board for review. She noted that District staff will address Mr. Mosher's comments during the meeting. Director Scheafer inquired about Mr. Mosher's comment regarding long-distance phone calls. Ms. Middenway stated that Mr. Mosher is referring to the phone number listed on the meeting's agenda. She noted that the public may call the phone number to join the Regular Board meeting via Zoom. She added that the District does not have a local phone number available to call. She stated that the phone number is provided by Zoom which is a San Jose, CA based phone number. Director Scheafer noted that Zoom's headquarters is in San Jose, CA. There was no further discussion. Procedural: 6. Ceremonial Matters and Presentations None at this time. B. Public Comments Procedural: 1. Public Comments Vice President Ooten opened public comments. Seeing no one wishing to speak, Vice President Ooten closed public comments. C. CONSENT CALENDAR COSTA MESA SANITARY DISTRICT PAGE 3 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Action (Consent): 1. Approve Consent Calendar Recommendation: That the Board of Directors approve the Consent Calendar as presented. Action (Consent), Minutes: 2. Approve the Board of Directors Special Meeting Minutes of May 6, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent), Minutes: 3. Approve the Board of Directors Study Session Minutes of May 12, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent): 4. Approve the Board of Directors Regular Meeting Minutes of May 26, 2020 Recommendation: That the Board of Directors approve the meeting minutes as presented. Action (Consent): 5. Adopt 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. Adopt Warrant Resolution No. CMSD 2020-12 Approving District Warrant Registers Recommendation: That the Board of Directors adopt Warrant Resolution No. CMSD 2020-12 approving District warrants for the Month of May in the amount of $683,874.37. Action (Consent): 7. Approve Payroll Transparency Disclosure for May 2020 Recommendation: That the Board of Directors approve and file this report. Action (Consent), Minutes: 8. Accept the occupancy count as presented as 22,967 and direct staff to prepare a warrant to CR&R Environmental Services for $238,018.50 for May 2020 collection Recommendation: That the Board of Directors accepts the occupancy count as presented using 22,967 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for May 2020 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $238,018.50 to be ratified in the June 2020 warrant list. Action (Consent): 9. Approve the preparation of a warrant to CR Transfer in the amount of $260,011.35 for May 2020 recycling and disposal services in the June 2020 warrant register. COSTA MESA SANITARY DISTRICT PAGE 4 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 ............__ Recommendation: That the Board of Directors approves the preparation of a warrant to CR Transfer in the amount of $260,011.35 for May 2020 recycling and disposal services to be ratified in the June 2020 warrant register. Action (Consent): 10. Contracts Signed by the General Manager Recommendation: That the Board of Directors receive and file this report. Action (Consent): 11. Approve the Investment Report for the Month of May 2020 Recommendation: That the Board of Directors approve the Investment Report for the month of May 2020. Motion: To approve the Consent Calendar as presented. 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 There was no further discussion. D. PUBLIC HEARINGS None at this time. E. GENERAL MANAGER'S REPORTS Action: 1. Consider Voting for One Candidate to the California Special Districts Association Board of Directors — Seat C — Southern Network for the 2021-2023 Term Recommendation: That the Board of Directors vote for one candidate for the California Special Districts Association Board of Directors — Term 2021-2023; Seat C — Southern Network Vice President Ooten stated that the Board nominates Secretary Schafer to serve as Seat C for the Southern Network of the California Special Districts Association (CSDA) for the 2021-2023 term. Motion: To vote for Secretary Arlene Schafer for the California Special District Association Board of Directors — Term 2021-2023; Seat C — Southern Network. 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 Approving Engineering Services Ad Hoc Committee Recommendations Recommendation: That the Board of Directors considers approving the following: COSTA MESA SANITARY DISTRICT PAGE 5 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 1. Engineering Services Ad Hoc Committee recommendations to implement a hybrid approach for engineering services that includes hiring a professional engineer as District Engineer and continue utilizing RBH for engineering services; and 2. Approve District Engineer job description and salary range; and 3. Direct staff to begin the recruitment for District Engineer by hiring an executive recruitment firm that specializes in public employee recruitments Vice President Ooten opened the item for discussion. Secretary Schafer requested a copy of the staff report. She inquired about the duties assigned to the District Engineer position. Director Perry stated that the information is posted on BoardDocs for review. General Manager, Scott Carroll, confirmed that the responsibilities of the District Engineer are listed in the staff report. Director Scheafer requested a synopsis of the staff report from Mr. Carroll. Mr. Carroll stated that District staff presented the Engineering Services Ad Hoc Committee's proposed hybrid approach for the District's Engineering Department to the Board at the Study Session on June 09, 2020. He noted that the hybrid approach involves the District hiring an in-house professional engineer while retaining Robin B. Harriers & Associates (RBH) for capital improvement projects. He discussed the staff report, which details the job description and salary range of the District Engineer position. He added that District staff recommends hiring a recruitment firm to help find a qualified applicant. He noted that a recruitment firm is estimated to cost between $25,000 and $30,000. Director Scheafer inquired about the recruitment process and the firms the District has researched to hire. Mr. Carroll stated that District staff has drafted a request for proposal to hire a recruitment firm. He noted that District staff will contact the recruitment firms listed in the staff report once the request for proposal is posted. He shared that the process involves interviewing the recruitment firms to determine the best value. He noted that the recruitment firm will focus on locating applicants with wastewater experience in Orange County. He added that the recruitment firm may expand their search to cover Southern California, the entire state of California, and possibly the nation to find the most qualified applicant. Ms. Middenway read aloud Mr. Mosherris comments regarding the Engineering Services Ad Hoc Committee's recommendations. COSTA MESA SANITARY DISTRICT PAGE 6 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Director Perry, Director Scheafer, and Secretary Schafer expressed support for the recommendations of the Engineering Services Ad Hoc Committee as presented. Motion: To implement a hybrid approach for engineering services that includes hiring a professional engineer as the District Engineer and continuing utilizing RBH for engineering services, approve the proposed District Engineer job description and salary range, and direct staff to begin the recruitment for the District Engineer by hiring an executive recruitment firm that specializes in public employee recruitment. 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. Action: 3. Consider Approving the Citizens Advisory Committee (CAC) Goals & Objectives for 2020-21 Recommendation: That the Board of Directors approve the list of goals and objectives to be discussed by the CAC in FY 2020-21. Secretary Schafer commented on the timeline for CAC discussion topics in the staff report. She recommended revising the discussion topics for the month of May. She stated that the CAC should not review the budget since it is a primary responsibility of the Board. Mr. Carroll stated that since the CAC is comprised of the District's constituents, it is their opportunity to review and offer suggestions for the District's budget. He confirmed that the Board has the sole ability to approve and adopt the District's budget. He noted that the Board does not have to approve of the CAC's suggestions. He commented that this process contributes to the District's values of open government and transparency. Secretary Schafer stated that the CAC members may attend the Regular Board meetings as members of public to offer their suggestions. Director Perry inquired about the District's budget approval process. Mr. Carroll stated that the Board approves of the District's budget in June of each year. Director Perry expressed support for the recommended CAC goals and objectives for 2020-21 as presented. COSTA MESA SANITARY DISTRICT PAGE 7 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Vice President Ooten expressed concern about the CAC 's ability to fully comprehend the District's budget process. Director Perry commented that District staff will have to provide the CAC with a comprehensive presentation on the District's budget. Vice President Ooten commented on the CAC discussion topics for the month of January. He inquired about the Policy Review Ad Hoc Committee's timeline for reviewing District policies. Director Perry shared that it is an on -going process to fully understand District policies. He noted that the Policy Review Ad Hoc Committee was meeting once a month. Vice President Ooten recommended creating an ad hoc committee to review the policies of the Orange County Sanitation District (OCSD) rather than having the CAC do this. He suggested briefing the CAC on District policies. Mr. Carroll stated that District staff does not intend to review every policy of OSCD with the CAC. He suggested that the discussion topic be revised to focus on the financial polices of OCSD and how they compare to the District's. He confirmed that the CAC will be reviewing the District's budget after the Board has discussed the preliminary proposal of the budget. Director Perry expressed support for Vice President Ooten's recommendation and suggested revising the OCSD discussion topic for January. Vice President Ooten stated that the suggested CAC goals and objectives will require agenda reports presented by District staff. Director Perry inquired if the General Manager can revise the CAC goals and objectives for 2020-21 after it is approved. Mr. Carroll stated that the Board can offer a motion which grants the General Manager the authority to make amendments or adjustments to the CAC goals and objectives for 2020-21. Director Scheafer expressed support for District staff's timeline of discussion topics for the CAC. Motion: To approve the list of goals and objectives to be discussed by the Citizens Advisory Committee (CAC) in FY 2020-21, and to give the General Manager the authority to make adjustments to the list as needed. Motion by Art Perry, second by Mike Scheafer. Final Resolution: Motion Carries 5-0 COSTA MESA SANITARY DISTRICT PAGE 8 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Aye: Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer There was no further discussion. Action: 4. Consider Adopting the FY 2020-25 Strategic Plan Recommendation: That the Board of Directors considers adopting the FY 2020-25 Strategic Plan. Mr. Carroll presented report details. He stated that the 2020-25 Strategic Plan was a collaborative approach by District staff, the Board, the CAC, and the public. He noted that it is more ambitious than previous strategic plans. Director Perry stated that the electronic version of the 2020-25 Strategic Plan had too many pages. He recommended ordering hard copies for the Board. Mr. Carroll stated that District staff will order hard copies. Director Scheafer requested a hard copy as well. Motion: To adopt the FY 2020-25 Strategic Plan. 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. 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. There was no discussion, and the report was received. G. TREASURER'S REPORTS Action: 1. Consider Adopting Resolution 2020-929 Approving the Statement of Investment Policy and Delegating the Investment Function to the Treasurer for Fiscal Year 2020-21. Recommendation: That the Board of Directors adopt Resolution 2020-929 approving the Statement of Investment Policy and delegating the investment function to the Treasurer for fiscal year 2020-21. Vice President Ooten opened the item for discussion. COSTA MESA SANITARY DISTRICT PAGE 9 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Director Scheafer requested an oral report from District Treasurer, Marc Davis. Mr. Davis presented report details. He stated that Resolution 2020-929 is a statement regarding the District's Investment Policy and a delegation of the District's investment function to the District Treasurer for one year. He noted that the California Government Code indicates that the investment function is a responsibility of the Board, which has the authority to delegate that function to a treasurer for a period of one year. He highlighted a few changes in the Investment Policy for FY 2020-21. He noted that the agenda item contains a redline and clean version of the Investment Policy. He discussed Section 11 Banks and Securities Dealers regarding broker dealers. He stated that the language is outdated and no longer necessary. He discussed a few changes to investment guidelines and strategy, which are on page 6 of the redline version. He reviewed certificates of deposit and revised the limit of 30% to unlimited. He shared that the District currently invests 25% of its portfolio in negotiable certificates of deposit and recommends increasing the amount to 30%, which is the limit set by the California Government Code. District Counsel, Alan Burns, inquired if negotiable certificates of deposit can be sold to others. Mr. Davis confirmed that negotiable certificates of deposit can be sold. Motion: To adopt Resolution 2020-929 approving the Statement of Investment Policy and delegating the investment function to the Treasurer for FY 2020-21. 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 Discussion, Receive and File: 1. Oral Report of Executive Compensation (General Manager) (Government Code §54953(c)(3)) Mr. Burns stated that, due to a series of reforms that resulted from the City of Bell, the District must provide the Board with an oral report to approve a contract for compensation. He noted that the General Manager's contract does not request an increase in compensation. He added that the proposed agreement will extend Mr. Carroll's General Manager contract for one year. He shared that Mr. Carroll did not request an increase in compensation due to the current circumstances. Action: 2. Approve Third Amendment to the General Manager's 2017 Employment Agreement COSTA MESA SANITARY DISTRICT PAGE 10 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Recommendation: That the Board of Directors approve the third amendment to the General Manager's 2017 Employment Agreement. Motion: To approve the third amendment to the General Manager's 2017 Employment Agreement. 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 Director Perry stated that Mr. Carroll should consider accepting a substantial increase in compensation next year. Mr. Burns stated that he has additional reports not on the agenda to present. He discussed the wastewater Vactor truck that required additional repairs after its purchase, for which the District sued the manufacturing company for compensation. He shared that the District accepted their proposal for compensation of $25,000 from the president of the manufacturing company. He noted that the District will prepare a settlement agreement. He discussed the recent Supreme Court ruling that determines that the 1964 Civil Rights Act Title VII, which bans sexual and other types of discrimination, includes gay, transgender, and other types of protected classes. He noted that the ruling upholds the integrity of the Supreme Court. He discussed a recent California court case in which public agencies could not charge to redact documents under the Public Records Act. He reviewed another recent court case which ruled that police cannot execute a special districts' warrant for health and safety matters to collect evidence on other penal code crimes, such as drug dealing and weapons violations. He discussed a court case regarding Penal Code 69, which states that it is a crime to threaten a police officer. Lastly, he covered two other cases regarding the Voting Rights Act in Chula Vista and Santa Monica. There was no further 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) - (President Ferryman and Vice President Ooten) Vice President Ooten stated that OCSD's meeting is next week. COSTA MESA SANITARY DISTRICT PAGE 11 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director Perry) Director Perry shared that the next SARFPA meeting is Thursday, June 25, 2020. He stated that at last month's meeting, the Board President and Vice President were elected. 3. Independent Special Districts of Orange County (ISDOC) - (Secretary Schafer) Secretary Schafer stated that ISDOC discussed the agenda for the general meeting. Director Scheafer shared that Doug Davert of the Orange County Council of Governments (OCCOG) inquired about special districts getting more involved with the Regional Housing Needs Assessment. 4. California Special Districts Association (CSDA) - (Secretary Schafer) Secretary Schafer shared that she attended a Legislative Committee meeting on June 1, 2020. She shared that she attended a Fiscal Committee meeting on May 7, 2020. She stated that she attended a Professional Development Committee meeting in which they discussed the location of their Annual Conference. She shared that the conference will take place from August 30th — September 2nd in Monterey, California. She shared that the General Managers Summit is scheduled to take place in Lake Tahoe in 2021. She noted that the Clerk Conference will take place in Anaheim on August 30th — September 2nd 5. Special District Risk Management Authority (SDRMA) - (Director Scheafer) Director Scheafer stated that SDRMAIs Board meeting is this week. 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 President Ferryman stated that he attended the National Water Research Institute Board meeting. He shared the results of their recent election for Chair and Vice Chair. Vice President Ooten stated that he attended the Water Advisory Committee of Orange County (WACO) meeting in which they had a guest speaker who discussed the tunnel project in Northern California. Director Scheafer stated that he attended the WACO meeting as well and expressed his support for the guest speaker's presentation. COSTA MESA SANITARY DISTRICT PAGE 12 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Director Perry stated that he attended the WACO meeting as well and shared that two-thirds of the Eastern Sierra's snow goes to Southern California. He noted that WACO predicts a 72% chance of a 6.7 magnitude earthquake in the next 25 years and that the sea level will rise substantially by the year 2100. Vice President Ooten commented that WACO reported a potential 10 foot rise in sea level by the end of the century. Secretary Schafer shared that the next WACO meeting is July 10, 2020. Director Perry stated that he attended the Costa Mesa City Council meeting. He shared that the City made a proclamation for the founder of Vans. He noted that the City Council reviewed their towing services contract, fiscal year budget, appropriation limits, and parkway maintenance and new sidewalk construction. Vice President Ooten inquired about a City of Costa Mesa Study Session meeting to discuss sole sourcing their solid waste services. Mr. Carroll stated that the City of Costa Mesa had a meeting with their waste haulers regarding multi -family services, and the District is trying to gather more information. 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 requested a Special Study Session Meeting to discuss the District's budget with the District Treasurer, Finance Department, and General Manager. Vice President Ooten inquired about the budget schedule. Mr. Carroll noted that District staff is preparing an item regarding an analysis of the District's financial strength for the July Study Session. COSTA MESA SANITARY DISTRICT PAGE 13 MINUTES OF THE BOARD OF DIRECTORS REGULAR MEETING HELD JUNE 22, 2020 Secretary Schafer stated that she would prefer a Special Meeting to discuss the budget. Mr. Carroll requested more clarification. He noted that the District's budget is already adopted. He inquired if Secretary Schafer would like to discuss the District's reserves and financial policies for emergencies. He noted that District staff is currently working on gathering that information. Secretary Schafer confirmed Mr. Carroll's discussion items. Director Perry and President Ferryman expressed support for a Special Meeting to discuss the budget. Mr. Carroll stated that Ms. Middenway will schedule a Special Meeting date that works for the Board. Director Scheafer requested a report regarding CR&R's truck fleet at the next Study Session. He requested assistance with his iPad and its charging functions. Director Perry thanked District staff for the flowers they sent after his recent surgery. 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 Vice President Ooten adjourned the meeting at 5:34 P.M. in honor of Ryan Ferryman. Secretary 4 t' e;::-� Ja s Ferryman Pre ident