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Minutes - Board - 2023-04-11COSTA MESA SANITARY DISTRICT MINUTES OF BOARD OF DIRECTORS STUDY SESSION APRIL 11, 2023 Members present Art Perry, Arlene Schafer, Bob Ooten, Brett Eckles, Mike Scheafer Members absent None Staff present Scott Carroll (General Manager), Noelani Middenway (District Clerk and Public Information Officer), Gina Terraneo (Management Analyst II), Kaitlin Tran (Finance Manager), Dyana Bojarski (Administrative Services Manager), Mark Esquer (District Engineer), Steve Cano (Wastewater Maintenance Superintendent), Lieu Tran (Accountant), David Griffin (Interim Code Enforcement Officer), Tanisha Tingling (Administrative Assistant II), Sean Phan (Associate Accountant) Others present None Meeting called to order at 8:00 A.M. A. OPENING ITEMS Procedural: 1. 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.) President Scheafer called the meeting to order at 8:00 A.M. District Clerk & Public Information Officer, Noelani Middenway, noted that President Scheafer, Vice President Schafer, Secretary Perry, Vice Secretary Ooten, and Director Eckles were present. COSTA MESA SANITARY DISTRICT PAGE 2 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 B. PUBLIC COMMENTS Procedural: 1. Public Comments President Scheafer opened public comments. Hearing none, he closed public comments. C. ITEMS OF STUDY Presentation: 1. Introduction to Sean Phan, Associate Accountant - Oral Report Recommendation: That the Board of Directors receives and files this oral report. Finance Manager, Kaitlin Tran, introduced the District's new Associate Accountant, Sean Phan, and shared his previous work experience. Action, Receive and File: 2. Receive and File March 2023 Code Enforcement Officer Report Recommendation: That the Board of Directors receives and files this report. Interim Code Enforcement Officer, David Griffin, presented report details. Discussion followed regarding trash issues on Royal Palm Drive. President Scheafer inquired about Senate Bill (SB) 1383 enforcement measures. General Manager, Scott Carroll, stated that SB 1383 violations will be included in the monthly Code Enforcement Report once the District begins enforcing SB 1383. Discussion followed regarding cardboard disposal issues and trash cart in public view violations. There was no further discussion, and the report was received. Action, Discussion: 3. Preliminary Biennial Budget Review for Fiscal Years 2023-24 and 2024-25 COSTA MESA SANITARY DISTRICT PAGE 3 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 Recommendation: That the Board of Directors provide feedback to staff regarding the proposed preliminary Biennial Budget for the Fiscal Years 2023-24 and 2024- 25. Mr. Carroll introduced the item. He stated that the preliminary biennial budget for fiscal years 2023-24 and 2024-25 is balanced. Ms. Tran presented the budget summaries for fiscal years 2023-24 and 2024-25. She discussed the estimated revenue amounts for fiscal year 2023- 24. President Scheafer inquired about new construction properties and accessory dwelling units (ADUs). Ms. Tran stated that the District's wastewater rate study over -projected the number of new construction properties, which has been reflected in the revenue estimates. She also noted that the estimated revenue amounts for sewer permits and inspection fees are lower than the fiscal year 2018-2019 revenue amounts. She shared the fiscal year 2023-24 salaries and benefits for administrative and wastewater staff, which includes a 6% cost -of -living adjustment (COLA). She provided a justification for the request for a part- time Accounting Clerk for the Finance Department and full-time Administrative Assistant for the Engineering Department. Discussion followed regarding COLA percentages and employer/employee retirement expenses. Ms. Tran stated that the District covers the employee and employer contributions for two employees' California Public Employees' Retirement System (Ca1PERS) benefits. Discussion followed regarding retirement payments and extended benefits. Mr. Carroll stated that the District pays Ca1PERS for retired employees but does not offer lifetime benefits. Director Eckles requested more information regarding unfunded pension liabilities. COSTA MESA SANITARY DISTRICT PAGE 4 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 Ms. Tran presented fiscal year 2024-2025 salaries and benefits, which includes a 5% COLA. She shared fiscal years 2023-24 and 2024-25 operations and maintenance budgets. She noted that the major expenditures include CR&R's solid waste services. She presented the accounts with the most significant expenditure increases. President Scheafer inquired about state and federal grants and financial assistance for District projects. Mr. Carroll shared that the County of Orange has not offered any financial assistance for the District's Elden Forcemain Redundancy Project. Ms. Tran presented the Finance Department's budget requests. Mr. Carroll presented the Solid Waste Department's budget requests. He discussed CR&R's rates, 5% COLA request, and tonnage amounts. He provided an update regarding the department's reorganization and hiring process. Discussion followed regarding SB 1383 trash cart enforcement and CR&R's COLA requests. Ms. Middenway provided an overview of the District Clerk, Public Information, and Information Technology budget requests and discussed election costs. Administrative Services Manager, Dyana Bojarski, provided an overview of the Human Resources and Risk Management budget requests. She discussed the purpose of a Classification and Compensation Study. She shared details regarding cafeteria plan increases and liability insurance. Discussion followed regarding the cost of a Classification and Compensation Study. Director Eckles suggested conducting the study internally rather than hiring a consultant. Ms. Bojarski stated that the District does not have the necessary resources, knowledge, and staffing to properly conduct the study internally. COSTA MESA SANITARY DISTRICT PAGE 5 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 Mr. Carroll stated that the Classification and Compensation Study will ensure that the District is competitive in regards to compensation and benefits. Ms. Bojarski shared details of how the study is performed. Discussion followed regarding the bidding process and timeline for the Classification and Compensation Study. Vice President Ooten discussed Orange County Sanitation District's (OCSD) compensation. Discussion followed regarding liability insurance, the District's experience modification (EMOD) rate, and workers' compensation costs. District Engineer, Mark Esquer, provided an overview of the Engineering Department's budget requests and justification for a new Administrative Assistant. He discussed Capital Improvement Projects (CIPs) for fiscal years 2023-24 and 2024-25. Director Eckles inquired about the budgeted amount for the Administrative Assistant position. Ms. Tran stated that the figure is based on the salary range for the District's current Administrative Assistant with assumed COLA percentages and benefits included. Discussion followed regarding the budget transfers for the Elden Forcemain Redundancy Project. Vice Secretary Ooten inquired about the Brick Manhole Rehabilitation project. Mr. Esquer stated that the Wastewater staff periodically inspects and documents District manholes for rehabilitation. He discussed the budget amounts for repairing manholes. COSTA MESA SANITARY DISTRICT PAGE 6 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 President Scheafer adjourned the meeting at 9:40 a.m. and reconvened the meeting at 9:45 a.m. Wastewater Maintenance Superintendent, Steve Cano, provided an overview of the Wastewater Department's budget requests. Discussion followed regarding the Wastewater Department's emergency generators. Ms. Tran provided an overview of the Asset Replacement and Facilities Revolving Funds. Director Eckles asked if a Shredding and Compost Event has been included in the preliminary budget proposal. Ms. Tran confirmed that the event is included in the budget and can be found in Attachment A of the staff report. Director Eckles thanked District staff for presenting a balanced budget. He commented that this is the first true balanced budget in several budget cycles. Mr. Carroll noted that in the past, the District was overfunded in the Solid Waste Fund and as a result, reduced its solid waste rates. President Scheafer thanked District staff for their efforts and stated that the Board will review all budget requests. Vice Secretary Ooten asked if the proposed budget is balanced due to the current wastewater rate increases. Mr. Carroll confirmed that the rate increases helped produce a balanced budget. Vice President Schafer expressed recognition for the District's 2023 spring newsletter edition. Vice Secretary Ooten shared that most pharmacies now accept expired or unused medications. COSTA MESA SANITARY DISTRICT PAGE 7 MINUTES OF THE BOARD OF DIRECTORS STUDY SESSION HELD APRIL 11, 2023 Mr. Carroll summarized the Board's requests for more information regarding long-term retirement costs, Classification and Compensation studies, EMOD and workers' compensation rates, and funding for demolishing a building at the District Yard. There was no further discussion. D. CLOSING ITEMS Procedural: 1. Oral Communications and Director Comments None. Procedural: 2. Adjournment President Scheafer adjourned the meeting at 10:11 A.M. Art Perry Secretary Mike Scheafef President