A regular meeting of the Board of Supervisors of the Coral Springs Improvement District was held on Monday, January 25, 2010 at 3:02 p.m. at the District Office, 10300 NW 11th Manor, Coral Springs, Florida. 


            Present and constituting a quorum were:


            Robert Fennell                                                President

            Sharon Zich                                                     Vice President

            Glenn Hanks                                                   Secretary


            Also present were:


            Kenneth Cassel                                               District Manager

            Dennis Lyles                                                   District Counsel

            Dan Daly                                                         Director of Operations

            Kay Woodward                                              District Accountant

            Jan Zilmer                                                       Human Resources

            Randy Frederick                                             Drainage Supervisor

            Ed Stover                                                        Water Department

            David Macintosh                                            Wastewater Department

            Gerrit Bulman                                                 CH2M Hill

            Cory Johnson                                                  CH2M Hill


FIRST ORDER OF BUSINESS                             Roll Call

            Mr. Cassel called the meeting to order and called the roll. 


SECOND ORDER OF BUSINESS                        Approval of the Minutes of the December 21, 2009 Meeting

            Mr. Fennell stated each Board member received a copy of the minutes of the December 21, 2009 meeting and requested any corrections, additions or deletions.

            Mr. Hanks stated on page ten, the third paragraph states, “Mr. Hanks stated it is a lot of money you have to spend for improvements on a water scenario.”  I think that is a “what if” scenario.

            Mr. Fennell stated on page three Mr. Brown stated, “We are on schedule to meet the April 3, 2010 deadline.”  I think he meant for the wall construction.  I think the actual deadline to finish is still a year and a half away.  Other than that there was quite a wide range in discussions.

            Mr. Cassel stated in regards to that statement he might have been referring to Plant F as well.  I will go back and listen to the minutes carefully because Plant F is scheduled to come on the end of March or the first part of April. 

            Mr. Fennell stated okay.  Maybe that was what he was talking about.

            Mr. Cassel stated he might have been referring to Plant F being online.  I will go back and have her double check the records. 

            Mr. Fennell asked are there any other corrections?

            Ms. Zich responded no. 


On MOTION by Ms. Zich seconded by Mr. Hanks with all in favor the minutes of the December 21, 2009 meeting were approved as amended.


THIRD ORDER OF BUSINESS                            Supervisors’ Requests and Audience Comments

            Mr. Hanks asked was it just last month that we got our draft infiltration report?

            Mr. Fennell responded we got part of it.

            Mr. Hanks asked when will we get the remainder of that infiltration report?

            Mr. Cassel responded I went over it this past week with Mr. Schwarz and there were some issues we are still looking at.  We are still doing some additional field observations and supplying it to Mr. Schwarz so we make sure the data we are using starts at the same point 

            Mr. Hanks stated one of the other issues was we were also looking at some different periods between when the water was actually measured.

            Mr. Cassel stated we are reconciling those issues as well as the standards as to what to project a potential return on wastewater would be; is it 60 gallons, is it 80 gallons, based upon the standards that are agreed upon from the different regulatory agencies.  We are also looking at pump curves, pump pressures, from internal.  We are supplying this information to complete the analysis. 

            Mr. Hanks asked with regard to Plant #3 and the catwalk where we were going through the emergency repairs; when is Plant #3 scheduled to be retired?  Is it going to be retired when the nanoplant comes online?

            Mr. Cassel responded sometime after that.  We have not come up with the actual timeframe for dismantling that.  That would be the last plant to go.  The two smaller plants would probably be abandoned first. 

            Mr. Hanks asked even though they are newer?

            Mr. Johnson responded in our design report provisionally we assumed that Plant #2 would stay operational because it is the newest or the one in the best shape. 

            Mr. Hanks stated so you do anticipate taking down something assuming it can be reached at a later date once it actually comes online to take a look at repair costs versus operational costs. 

            Mr. Fennell asked will we look at the I&I later on?

            Mr. Cassel responded at the next meeting.

            Mr. Fennell asked has anyone gotten samples of pipes?

            Mr. Cassel responded we actually looked at the definition of “crumbling pipe”.  In talking to staff it does not actually crumble.  It is vitreous clay pipe.  It shatters and cracks if you are not careful handling it.  It does not crumble like a burned piece of paper would in your hand per se.  It is more of a fracturing of the pipe.

            Ms. Zich asked in how many places did this occur?

            Mr. Cassel responded the crew has run into this in two or three different places during repairs.

            Mr. Daly stated a lot of it has to do with the fact the bedding underneath it is not stable so naturally when you get some pressure on top it will crack.  I do not think it is the material at all.

            Ms. Zich stated that is a relief. 

            Mr. Fennell stated I guess we will get more from this later.  It is still a good topic.  Will we find out next time?

            Mr. Cassel responded we should have the final report by the next meeting.

            Mr. Fennell asked will it include pictures of some pipes inside?

            Mr. Cassel responded I will find out if we will have any pictures of actual pipes.

            Ms. Zich asked will someone keep track of what dates they find this is happening so we know how often we are really talking about?

            Mr. Cassel responded we will go back to our records and look.

            Ms. Zich stated that sounds important; whether it is a really big problem we need to take care of soon or whether it is a wait and see problem. 

            Mr. Daly stated no matter what, we are going to evaluate the numbers.  Mr. Cassel has exhaustingly analyzed it nine ways to Sunday, kudos to him, to see if what we are reading here really is what it says.  He is still looking at that.  We are talking about it.  We are getting Doppler measurements as far as flows and pressure.  There is one lift station area in particular and I think they just moved to another one so maybe two within that area will be six that were giving us some issues.

            Mr. Fennell stated okay so you are going to do flow checks, you are going to do more in depth work, look more at the pipes to try to find the cause of the problem.

            Mr. Daly stated there will be some real time data.  It will not be during our wet season.  That is the only bad part of about it.


FOURTH ORDER OF BUSINESS                        Consideration of Interlocal Agreement with Broward County to conduct Feasibility Analysis and Design Study Related to the Development of Alternative Water Supplies

            Mr. Cassel stated the Board will remember we applied for a grant for matching funds for reuse study and alternate water supplies and usages.  We have not done any work on the project yet.  This is the county responding to the fact they will cost share grant up to the amount of $41,500 for the project.  It is not saying we have to spend the whole $41,500, but we have up to that.  We have to look at the actual scope that we originally anticipated in this and make sure we are on track with it before we institute any of that work being done.  This is to accept the grant from the county so that we can.  If we do not respond by February 12, 2010 the grant goes away and any reuse study we would have to do for any of our permits, we would have the full burden of the cost.

            Mr. Fennell asked so what do we need to do?

            Mr. Cassel responded approve entering into the interlocal agreement with the county. 

            Mr. Hanks asked would this still require us to have expenditures in the amount of $40,000?

            Mr. Cassel responded not necessarily.  We can spend up to $41,500.  If we decide to scale back our scope of work, we can. 

            Mr. Hanks asked what are the requirements?  Are we under any obligation by permits or by regulation to update the reuse feasibility study?

            Mr. Cassel responded our wastewater permit application requires a reuse component.  We did the reuse component initially in 2005 and it was submitted.  What we have done for now is put a letter on top of that with our permit application stating nothing has really changed.  There are no clients out there for the reuse.  Our position right now is not to move ahead with anything.  It is coming back to me through the engineering firm that DEP will probably require some kind of an update of the reuse permit as part of the application process.  I am trying to see if we can make sure that whatever we do with this information covers two birds with one stone to make sure we are covered without having to spend money on an update on one thing and do something else after that.

            Mr. Fennell asked who is doing the actual study?

            Mr. Cassel responded initially it was authorized to CH2M Hill.

            Mr. Hanks asked by us going forward with this interlocal agreement and the reuse study, is this going to trigger us to go forward with any capital expenditures?

            Mr. Cassel responded that is my biggest concern.  I do not want to get incrementalized into a position where it requires the District to go further than we absolutely have to.  This is why we are going to look at the scope of that work authorization to make sure we do not get incrementalized by a regulatory agency by doing something we may be able to attack by a different direction. 

            Mr. Fennell stated I just want to make sure there is a return on investment.  If we put money into this, what is the return on it?  It would have to be economically feasible.

            Mr. Hanks asked Mr. Johnson, did you get a chance to look at any of the things we discussed as far as potential changes to this?  Mr. Johnson caught up with me on Friday at the Water Resources Task Force and picked my brain about a few different things.  One of the items we discussed was onsite use, treated water or freshwater for the solutions and products into the wastewater treatment plant.  I just do not know if this is something we have the ability to do; if this falls under the feasibility study that we can pursue.  There may be something where we can eliminate some of our finished water treatment that we have to pump into our wastewater.  We may be able to spin it off of wastewater instead. 

            Mr. Johnson stated we are going to be meeting with management and staff to take a closer look at whether or not this makes sense.  Right now you use a significant amount of water out of your water treatment plant over here for carrier water and wash down water.  The thinking is you can potentially install some type of a reuse package system where you could use the water from your wastewater treatment plant rather than using the water plant water, thereby freeing up that capacity in the water plant and reducing the load on your deep injection.  You would essentially be using treated wastewater for wash down and chemical carrier water over in the wastewater plant.

            Mr. Fennell asked is that a significant part of the system?

            Mr. Johnson responded we looked at some flow data from Mr. Bulman’s project when he was doing the well project over here.  We were looking at flow coming into the wastewater plant and flow going down the deep injection well.  It was in the order of 200,000 to 300,000 gallons a day used from this plant over here for wash down and chlorine carrier water.  It is a significant amount of water.  That could be or would be one of the things we would look at as part of this. 

            Mr. Hanks stated but then we have an example of something that could be somewhat of a return on our own money.  On one side you are treating the wastewater to a higher standard, but on the other side you do not have to treat the other water to drinking water standards. 

            Mr. Johnson stated you would have some type of a filtration system and you would chlonnate the water whereas over here you have lime softening and sludge handling.  The cost difference between a reuse system on an O&M basis is going to be significantly lower than the O&M cost for your water plant over here.   We have to meet with Mr. Cassel and staff to look at how much this makes sense.

            Mr. Hanks asked if we approve this interlocal agreement, what is it we are immediately on the hook for?

            Mr. Lyles responded you are on the hook for a not to exceed fee of $41,500 as the matching 50/50 share of the funding the county has agreed it will not exceed for this consulting work.  I want to point out to you, as you have already been told by Mr. Cassel, that if the costs go higher the county does not pay anything further.  TI is 100% the District’s responsibility.  Obviously if the costs are lower, the county’s number goes down.  We do not have the right to terminate this agreement once you authorize, enter into it and it starts.  The county can terminate it for convenience, but we cannot.  They want us to finish this study and come up with a product as described in the scope of services.  We do not have the ability to say this does not make sense and we are going to stop.  It would have to be based on a breach by the county that they do not cure within a 10 day period.  There is a bit of a commitment over and above what the county is committing to us.

            Mr. Hanks stated so once we go ahead and do this we have made the commitment to move forward with the study period.

            Mr. Lyles stated even if the cost exceeds the projected $83,000.

            Mr. Hanks stated under the project description it lists something about NSID.  Where was that?

            Mr. Lyles responded on page 17.

            Mr. Johnson stated as part of the grant application we originally discussed the idea of regionalization because it scored additional points with Broward County.  Part of this was what kind of agreements there could be with other communities; whether it be the City of Coral Springs, NSID or Tamarac.  That was part of it on a feasibility or planning level.

            Mr. Hanks asked can we piggyback in the issue of the plant incubus study or is that going to be something the county will look at and say no that was not part of your grant application; no we cannot go on and match this grant?

            Mr. Johnson responded in researching the report and the regulations my understanding is as long as we fill the requirements of the scope that could easily be a part of the study or the recommendations for at least a part of the discussion.  If it does not make sense to do a regional facility and a local facility, then obviously the feasibility of one versus the feasibility of another is the District’s right to choose. 

            Mr. Hanks asked counsel, are there any other concerns about modifying, amending or expanding the scope to include this component?

            Mr. Lyles responded no sir.  Given the nature of this type of agreement and the county’s use of this form, to modify any of it including the language of the scope would be problematic at this point unless we want to start over.  I think the way it is, as long as we are comfortable with the financial commitment that is being made, I think the document itself is fine.

            Mr. Hanks asked do you think it allows enough flexibility?

            Mr. Lyles responded I believe so.

            Ms. Zich asked is this really a necessity?

            Mr. Fennell responded as part of our renewals we agreed to go through this and see whether or not this is feasible.  It was part of our water bond issue to look at feasibility.  Now we are getting the county to put in half of what we needed to just go look at it.  This is a good deal for us.  So yes, we probably would have had to do this anyway sooner or later.

            Mr. Hanks asked if the county’s matching grant opportunity would not have arisen, would you see us as having to proceed with a similar scope feasibility study?

            Mr. Cassel responded we would have to do at least an upgrade as part of our wastewater treatment plant permit renewal that is in place now.  I am trying to figure out if we can utilize part of this report to meet the requirements of that as well.

            Mr. Johnson stated the requirements of the feasibility study and these requirements align pretty well.  In doing this study it does actually cover the feasibility study for the wastewater treatment plant.

            Mr. Hanks asked when were we required to have the study for the wastewater treatment plant application?

            Mr. Cassel responded technically the application went in with the 2005 study with a cover letter to see if that would be acceptable.

            Mr. Hanks stated it is now 2010.

            Mr. Cassel stated we used the 2005 study with an updated memorandum.

            Mr. Hanks asked is that in process?

            Mr. Cassel responded that is already in process with DEP.

            Mr. Hanks asked have we heard any comments yet?

            Mr. Cassel responded no.  The feedback is they will probably want at least an update or at least some kind of revised study.  The question now in discussions with the engineers is how we tie it together to make sure we do not have to do two studies.

            Mr. Hanks stated within the next month or two we can get a letter from DEP saying we need a reuse feasibility study as far as our application for the wastewater.

            Mr. Cassel stated that we need to update our 2005 study to current conditions; according to Chapter 403.  There are a couple of sections that require as part of the permit application for any new, renewal or modifications. 

            Mr. Hanks asked how would we pay for this?

            Ms. Zich responded that is what I was thinking of.  I was just talking to Ms. Woodward about an hour ago.  I usually go over financials with her.  When you look at the financial statements and you look at how much engineering is already over budget.  We did not plan for any of this so we are going to be what; $135,000 over this year already?

            Ms. Woodward responded right now in water and sewer operations the engineering is scheduled to be over budget $122,000.

            Ms. Zich stated and then we are going to add this amount to it.  It is going to be $165,000 over.

            Mr. Cassel asked is this included Ms. Woodward?

            Ms. Woodward responded this is included; Work Authorization #56.

            Ms. Zich stated this is why I brought this up.  I just went over it with her an hour ago.  This is a lot. 

            Mr. Johnson stated as part of the bond report there are a number of projects.  There is obviously the phase one projects, which include the nanofiltration plant, Plant F and the other thing, if I remember correctly, a reuse study design was part of that initial bond. 

            Ms. Zich asked was that in there?

            Mr. Johnson responded I believe it was a bond requirement.

            Mr. Daly stated phase two if the District decided to go that direction.

            Ms. Woodward if not, it stays as part of the operational budget.  Right now I have to make the assumption it starts out as an operating budget item until something changes in the future. 

            Mr. Fennell stated we said we would look at feasibility.  We did not say we were going to do it because it has to be feasible, but we said we would study that. 

            Mr. Hanks asked what is the risk if we do not, as far as pursuing future grants with Broward County, if we back out of it at this point?

            Mr. Fennell responded I think it is a good deal. 

            Ms. Zich stated yes, but I just wanted to bring it to everyone’s attention.

            Mr. Hanks asked Ms. Woodward, can you make this work?

            Mr. Fennell responded the $40,000 is not the problem.  The problem is spending several more millions on something.

            Ms. Woodward stated you have several problems.  The initial item is the missed schedule that went in the Board’s package.  We summarized the work authorizations and this is what Ms. Zich is referring to.  The reuse feasibility study, the five year permitting and the injection well pump station mechanical evaluation.  Those three work authorizations threw us over budget in operating funds for water and sewer.  If a feasibility study is done and it is ultimately determined that you should go forward, and going forward means using funds from the bonds, then what we have spent in this particular work authorization can be crossed over and paid for out of bonds.  If you decide in the future that we have done the feasibility study, we are not going forward with it, then it has to be absorbed by operations.  Right now it is showing as operations just so you know the status of where we are today.

            Mr. Hanks asked which are the three work authorizations you mentioned?

            Ms. Woodward responded Work Authorizations #55, #56 and #57. 

            Mr. Hanks asked #55 and #56 I can understand being somewhat of an unusual thing we could not have budgeted for, but FDEP permit renewals; why was not that in our budget?

            Ms. Woodward responded it was actually a fluke in the timing of personnel changes here.  I have been here for two years.  I was not aware of it so I did not know to put it in the budget.  Mr. Cassel was new to the procedures as well.  He was not here back when the original five year permit was done.  For some reason during the process of drawing up our budget for the year, no one else brought it to the forefront and we basically did not know to look for it.  So yes; that is an ‘oops’ on the part of the preparation of the budget. 

            Ms. Zich stated okay.

            Mr. Fennell asked is there a motion?


On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the Interlocal Agreement with Broward County to conduct feasibility analysis and design study related to the development of alternative water supplies was approved.


            Mr. Fennell stated I think it is a good thing to find out how we can best use the bonds.  We do not want to radically go out and spend a lot of money to do that, but if there is actually some good rational way that we can do that or cease things going forward, then we should look at it.

            Ms. Zich asked does every district do this or something like this?

            Mr. Hanks responded no.  There are very few systems in the county that are looking or have existing reuse programs.  Pompano Beach has a reuse where they irrigate some of the golf courses, Broward County has some purple pipe, Coconut Creek is putting in some purple pipe.

            Ms. Zich stated it seems like this would be such a big thing that Broward County would just do it themselves.  They are helping us pay for this, but it just seems like it would make sense for them to do it.

            Mr. Hanks stated there are not too many sewer treatment systems that are up other than Broward County.  You have Hollywood, Broward County, Fort Lauderdale and Sunrise.  You have very few.

            Mr. Fennell stated but this is all a part of us trying to support a greater overall plan of water usage throughout the counties.  I think that benefits us all.  We do need a rational approach; not only for us, but everybody.


FIFTH ORDER OF BUSINESS                             Consideration of Proposal from Hillers Electrical Engineering, Inc. for Plant F Programming Services

            Mr. Fennell asked what is going on here?

            Mr. Cassel responded this is a direct proposal from Hillers Electrical Engineering, Inc to the District instead of through CH2M Hill for the programming services connected to Plant F.  I think it also ties into the monitoring well.  I will let Mr. Johnson speak to it further.

            Mr. Johnson stated as part of the construction project there is a portion of programming that needs to happen in order to control pumps turning on and off.  Hillers Electrical Engineering, Inc has a lot of background knowledge of the facility here.  They have been doing work here for years and we felt it is important for them to stay engaged on this project too.  We are recommending Hillers Electrical Engineering come in and do programming as part of it.  They will do the programming which is going to tie it into the computer system in the wastewater operations.  This is needed to tie the new project into the existing facility from a monitoring program control system.

            Mr. Fennell asked what does staff say about this?

            Mr. Macintosh responded I have not seen this proposal.

            Mr. Johnson stated the people at Hillers Electrical Engineering, Inc will program it in part of the specification.  As to whether or not it will turn the pumps on or off, or the control pumps on or off automatically, I am assuming there are automatic controls to your pumps for lead and lag pumps.

            Mr. Macintosh stated no.

            Mr. Johnson stated I cannot speak to what is happening on the previous plants, but on this one here they will be programming to control the system.

            Mr. Fennell asked where are the controls actually at?  It just sounds like software here.

            Mr. Cassel responded the controls, I believe, are being installed as part of the project per se.  This is the programming portion of making those controls work.  We took the programming out of the contract with whatever general contractor because we did not want a third party programming contractor coming in who is not familiar with all the programming that is currently going on within the District; how things are tied together, how they interact, making sure the programming is rational and fits with what we are used to working with. 

            Mr. Fennell stated I would like to get our staff directly involved; the guys who are going to have to operate from day to day. 

            Mr. Johnson stated up until this point I believe that Hillers Electrical Engineering, Inc has pretty much engaged with Mr. Aversa.

            Mr. Macintosh stated Mr. Aversa was before me on that.  I took over from him.  I have been involved with Hillers Electrical Engineering, Inc.  I am just not aware of the particulars of this.

            Mr. Fennell stated he has come in and done some work for us before.

            Mr. Macintosh stated I took over for Mr. Aversa.

            Mr. Cassel stated Mr. Macintosh has been instrumental in monitoring; working with not only the injection well, but he has been monitoring Plant F and the construction to make sure it complies with how he will have to operate it down the road. 

            Mr. Fennell stated my only suggestion here is that Mr. Macintosh be part of this programming.  It has always been a wise thing to have the person who is actually operating the thing be part of the programming and operations of what you are actually going to put in.

            Mr. Macintosh stated I believe what Mr. Cassel is saying is the normal instrumentation of what you have done.  It is now being done under a different contract.  From what I understood from Mr. Johnson was that you would be setting it up differently from the rest. 

            Mr. Cassel stated we should tie it all together, tie it into our system. 

            Mr. Hanks asked are we in agreement this needs to be done?

            Mr. Cassel responded yes. 

            Mr. Hanks asked is it budgeted someplace?

            Ms. Woodward responded it was never budgeted.  It will be part of your capital project bonds.

            Mr. Hanks asked Mr. Johnson and Mr. Macintosh, do you feel the $23,000 being requested by Hillers Electrical Engineering, Inc. is a fair and reasonable price for the service?

            Mr. Johnson responded absolutely.  We did an internal assessment and felt that was a very reasonable price. 

            Mr. Hanks asked counsel, do we have any issues with CC&A, bidding or anything like that with regards to this threshold and the services provided?

            Mr. Lyles responded no.  This is not a CC&A event.

            Mr. Hanks stated so we are good to go.

            Mr. Lyles stated we are good to go.


On MOTION by Mr. Hanks seconded by Mr. Fennell with all in favor the proposal from Hillers Electrical Engineering, Inc for Plant F programming services in the amount of $23,000 was accepted. 


SIXTH ORDER OF BUSINESS                             Staff Reports

            A.        Manager

            Mr. Fennell asked do we have a few additional items?

            Mr. Cassel responded yes I have a couple of additional items under the manager’s report.  The first item is purely informational.  It is a report from the Fish and Wildlife Research Institute regarding widespread fish kills in Florida due to the cold weather.  It explains something which has been going on with fish and they are looking at it.  According to Mr. Daly we have had crews out.  We had some extensive fish kills.  We have been picking up fish.

            Ms. Zich asked our fish that we put in the canals?

            Mr. Frederick responded no the carp are the only ones which have not died; most of them are exotics, the tilapia, peacock bass and the iguanas. 

            Mr. Fennell asked how many iguanas did you find?

            Mr. Frederick responded a lot of them.  They get up on the trees overhanging the canals and then fall out.

            Mr. Hanks asked how many surprises did you have?

            Mr. Frederick responded we had a big surprise the other day.  Last week we cleaned the canal across from the iguana park.  We had some big fish in there.  I was surprised.  They were bigger than our carp.  There were all types of fish that I have not seen before.  They are not native to this water.

            Ms. Zich asked do you think someone just dumped them in there?

            Mr. Frederick responded yes.  They get dumped out of fish tanks and then grow.  I was surprised.  I was shocked.

            Mr. Fennell asked how cool did the water get?

            Mr. Frederick responded we had a whole week of temperatures in the 30s and 40s. 

            Ms. Zich stated my pool was down to 52 degrees.  It has never been that cold.

            Mr. Fennell stated so they think it is temperature related.  Or is it oxygen related?

            Mr. Frederick responded no.  I do not think it is oxygen related.  Like I said, we are not pulling any of our grass carp out.  Grass carp can handle cold temperatures.  Up north my aunt had carp like fish.  She said they used to freeze solid and ice.  Then when the ice would melt they would swim away. 

            Mr. Daly stated Mr. Frederick even had some crew out on Saturday. 

            Mr. Fennell stated so I guess this memorandum was put out by Florida Fish and Wildlife.

            Mr. Frederick stated this is just so you know that it is not just our water, but it is throughout the whole state.

            Mr. Fennell stated you might want to put a copy of this on our website.

            Mr. Daly stated I have a link on the first page of the website.  This way it encompasses all four districts. 

            Mr. Fennell stated okay.  What is the next item?

            Mr. Cassel responded the next item is Resolution 2010-4.  It is regarding the Polaris Ranger item we had around here that we purchased in 2005.  The cost of repair is more than half of the cost of a new one so we are asking the Board to declare it as surplus equipment so we can get rid of it.  It is just sitting out here.  The reverse in gone on it and the internal battery charging scenario within its intern to the engine is also shot.  We replaced it with the utilization of one of our small pickup trucks for the staff to go around the yard to make their measurements and meter readings.  It is no longer needed as a piece of equipment. 


On MOTION by Mr. Hanks seconded by Mr. Fennell with all in favor Resolution 2010-4, declaring surplus equipment, was adopted.


            Mr. Fennell asked is this usual for us?

            Ms. Zich asked and this is a 2005?

            Ms. Woodward asked what is the limit on that, Mr. Cassel?  If it is under $4,000, can you just declare it surplus or how does that work?

            Mr. Cassel responded we had Ms. Demarco go back and look at the threshold.  I do not remember the actual threshold, but she went back, looked at the threshold and decided the threshold did require the Board to adopt a resolution on this one.  Some of the other items we eliminated last year were underneath the threshold.  We had some old computers and other equipment which were underneath the threshold that we could declare surplus, advertise and get rid of.

            Mr. Fennell asked do we have depreciation rates on items?

            Ms. Woodward responded we keep depreciation for financial statement purposes.

            Mr. Fennell stated in for profit corporations we are constantly talking about depreciation, how many assets you actually have on your books and that kind of stuff.  Computers are gone in three years.

            Mr. Daly stated technology has gone so far that it can be brand new in a box, but it will not be worth anything because the technology is so old.

            Ms. Woodward stated your situation now with computers is that they are so inexpensive that they do not even meet the threshold for being depreciated.

            Ms. Zich stated it is an expense right off the bat.

            Ms. Woodward stated you still need to keep track of it for insurance purposes, but you do not have to worry about depreciation. 

            Mr. Cassel stated the third item is the email I received yesterday from the Task Force Association of Florida Special Districts regarding a potential request that if we decided, as well as the FASD, to send a letter to the EPA administrator requesting an extension in the 60 day response time to the proposed numeric nutrient level regulations, we should do so.  I prepared a letter from the District based upon the letter sent by the Florida Pulp and Paper Association Environmentalist Affairs group with the same position, which is the position that FASD and other entities opposed to the potential levels that EPA is proposing in their rulemaking.  I am putting forth the letter for your consideration to either have Mr. Fennell sign as President or me as your District manager to send off to the EPA administrator.

            Mr. Fennell asked are we just asking for more time?

            Mr. Cassel responded that is correct.  The main issue is they are putting out a 60 day comment period.  Those of us in Florida cannot get the data or analysis to look at unless we go to Washington DC.  We cannot review if the analysis is proper or if it accounts for the right issues so we can formulate a proper response.  The letter asks that it be either sent to interested parties via a DVD, CD ROM or put on an FTP site where we can download it with our consultants.  FASD does have several consultants working on this for them.  As a member we are working with FASD regarding this. 

            Mr. Fennell stated the EPA is proposing a statewide nutrient criterion.  What does this mean to us?

            Mr. Cassel responded my understanding from FASD is that the proposed 1.6 part per million total nitrogen and the 42 parts per billion of total phosphorous are significantly lower than the existing.  The ability to get down to that would cause serious issues on all of the districts which were originally designed, maintained and utilized for stormwater conveyance; not rivers, lakes and aquatic utilizations.  The FASD is concerned would put an onerous burden upon the residents and rate payers of those special districts. 

            Mr. Fennell asked is there a rationale behind this?

            Mr. Cassel responded when they propose rules they give a 60 day comment period for those who will be impacted by the rules.  In this particular instance those who are impacted cannot get the data to look at it and see where the data came from, what the baseline was on it and do their own analysis to come back with comments. 

            Mr. Hanks asked like why are total phosphorous contents less than a half of the natural streams a couple of counties to the north?

            Mr. Cassel responded exactly; those kinds of issues.

            Mr. Hanks asked counsel; do you have any concerns with this?

            Mr. Lyles responded there really is not a legal issue here.  It is technical in nature.  We are requesting that time be given to comment after receipt of the relevant data supporting it.  I do not think there are any legal issues that we might be running afoul of.  It is a judgment call on the part of the Board. 

            Mr. Fennell asked what are the typical values we have in our canals these days?

            Mr. Cassel asked Mr. Frederick; do you remember what your total nitrogen phosphates are?  I know they are higher than what is being proposed.

            Mr. Fennell stated these are almost like values they are trying to put out in the middle of the Everglades. 

            Mr. Hanks stated if you look at the last page of the Everglades protection area, the total phosphorous is .01 milligrams per litter.  That is approximately 10 parts per billion.  You would have to cut it down to 25% of what we have.

            Mr. Fennell stated I need to understand and we need to put forward what we think we can live with. 

            Mr. Cassel stated that is what FASD is doing through its consultants. 

            Mr. Fennell asked do we have a number for ourselves?

            Mr. Cassel responded I do not have that number off the top of my head.

            Mr. Hanks stated right now you are just requesting extra time as well as the information.

            Mr. Cassel stated that is correct.  We are requesting that the comment time be extended so that FASD and those who are impacted can look at the data and make a proper comment back to them. 

            Mr. Fennell asked are we making these measurements all of the time?

            Mr. Cassel responded we do sampling every time we pump. 

            Mr. Frederick stated we sample it quarterly.  Because NSID has the ability to pump out to the Everglades, they have to sample every time they pump.

            Mr. Fennell stated I would appreciate seeing this given that we are doing this every quarter.

            Mr. Cassel stated I can forward it to you.

            Mr. Fennell stated forward them to all the Board members so we can see what it looks like.

            Mr. Hanks stated I do not see any harm in going ahead with sending this letter out.

            Mr. Fennell stated as far as asking for a delay, but I think we need to put forth our own policy here.  One thing is obvious.  They are treating the Everglades the same as the residential areas or farm areas for that manner. 

            Mr. Hanks stated South Florida canals outside the Everglades protection area.  Do you need a motion from us?  Do you need direction from us?

            Mr. Cassel responded no.  I just need to know if the Board prefers to send the letter with Mr. Fennell’s signature or my signature.

            Mr. Daly stated the last sentence says, “Please feel free to contact me at the numbers listed,” which is our number.  This would mean Mr. Fennell might receive a call here.

            Mr. Fennell stated let us send a letter out.  I’ll sign it.

            Mr. Cassel stated I have a letter prepared for your signature or my signature.  The letter is the same. 

            Mr. Fennell stated I know all three Board members are part of the FASD.  Are you?

            Mr. Cassel responded I believe Severn Trent is also as a whole.

            Mr. Fennell asked what about you, Mr. Daly?

            Mr. Daly responded no I am not.

            Mr. Fennell stated you should become one.  You guys need to get active in that for a couple of different reasons.  There are many different memorandums which come towards me all the time for a variety of different reasons.  Our interests are at stake and we might actually pick up some business as well.  You should be really heavy into that.  When you go to these meetings you find out they actually have these booths trying to sell services to special districts.  Sometimes the districts have their own booths as well.  Is anyone else sending a letter out?

            Mr. Cassel responded yes.  The Florida Pulp and Paper Association Environmentalist Affairs group, FASD and they have asked a list of the FASD Task Force to do so to speak as a united voice.


·         Monthly Water & Sewer Charts

            Mr. Cassel stated the next items are the monthly water and sewer charts. 

            Mr. Hanks stated we are still all over the place.

            Ms. Zich stated it is confusing to look at.  The two at the end say November of 2008 and December of 2008.

            Mr. Hanks stated those are probably typos.

            Ms. Zich stated it is just confusing to look at.

            Mr. Daly stated those have got to be typos.

            Ms. Zich asked do they mean 2008 or 2009.

            Mr. Cassel responded they mean 2009.

            Ms. Zich stated okay.

            Mr. Fennell stated distribution, billed and loss. 

            Mr. Hanks stated we are still losing over 10% of our water.  Is that accurate?

            Mr. Fennell responded this is distribution.

            Ms. Zich asked what happened in November?  It is so high.

            Mr. Daly responded that had to be a skewed number. 

            Mr. Fennell stated what you are taking is how much water went out versus how much we paid for it and what the difference is.  Is that correct?

            Mr. Cassel responded that is correct.

            Ms. Zich stated the loss is the thing to look at. 

            Mr. Daly stated we are going on versus what we billed. 

            Mr. Hanks asked where are these measurements taken?  Is the stuff that Mr. Johnson is talking about where water goes back to the plant for operation?  Is that were you are getting the loss percentage?

            Mr. Johnson responded no. 

            The record will reflect the recording picked up several people talking at the same time.      

            Mr. Hanks stated I do not think we can look at it on a month by month basis because you are going to have differences where your meters and where your bills are.

            Mr. Fennell stated it is looking like a 10% overall number.  That is a lot.  I can understand where we have wastewater intrusion, but this is water going out.

            Mr. Cassel stated against water billed. 

            Mr. Fennell asked what would be normal?

            Mr. Cassel asked what is the accuracy rating of the meters?

            Mr. Fennell responded I thought it was supposed to be 1%.

            Mr. Daly stated I think it is 2%.

            Mr. Cassel stated so you would end up with a 2% variation here.

            Mr. Daly stated Mr. Cassel, the Field Supervisor and I were discussing this.  One of the interesting things is when you have a large meter you get a large amount of water which passes through it for it to actually read accurately.  Small trickle water will probably not be caught.  It probably would not register.  We have so many shopping centers with master meters that are empty as well as restaurants.  This may have something to do with it.  It may be something we need to look into.

            Ms. Zich asked what do you mean they are empty?

            Mr. Daly responded for example Linens ‘n Things at the corner.  They are gone.

            Ms. Zich stated I thought you meant the meters were empty.  I understand. 

            Mr. Hanks asked do we have standby chargers on our meters?        

            Mr. Daly responded we do not.  We have base chargers.

            Mr. Hanks asked is that based on the size of the meter?

            Mr. Daly responded it is based on ERCs associated with the facility.  What happens is you get a place like Roadhouse Grill and let us say they had ten ERCs; ten ERCs would get ten base charges of water and ten base charges of sewer.  Now it is a church.

            Ms. Zich asked now Linens ‘n Things as it sits there; do we have collect any money every month or nothing?

            Mr. Daly responded base charges, but we are going to bill water pumped versus what we billed gallon wise.

            Mr. Hanks stated let us take Roadhouse Grill.  I am assuming you have a two inch meter out there.

            Mr. Daly stated probably. 

            Mr. Hanks stated in a church during the course of a week a three quarter inch meter would be fine.  That would pick it up normally whereas the bypass slippage on a two inch meter you will miss it.  Is there any mechanism that we can go ahead and suggest for them to size down that meter?

            Mr. Daly responded it was paid for by somebody up front.

            Mr. Hanks stated but if there is leakage going around the meter not detected than that is another issue.

            Mr. Daly stated the other issue would be that we would get one commercial base charge, which is maybe $20 for water and $20 for sewer as opposed to something with a higher reading.  It depends on the ERC.  In this case it would depend on the meter size.

            Mr. Hanks stated I am also wondering if we have a bypass meter that when you deal with a little flow it goes through the bypass and it gets picked up.

            Mr. Daly stated we have irrigation meters out there that we are not allowed to touch the timer.  It is a hands on type of a thing, but there is no house valve or anything to turn off.  I told the crew to change those meters.  It turns out that they had 562,000 gallons last month.  It was about 150,000 the month before because we changed a little bit of the billing period.  We knew they were using water, but the meter was broken.  When we go out there to see if they have the thing up or if it is on, it becomes more than tedious.  It is quite a job because you need to have someone out there at 6:00 a.m. or 4:00 a.m. seeing if the water comes on.

            Mr. Hanks stated the other thing is you can go through your list of uses.  You know Red Lobster is using water.  It is a reasonable amount they are using. 

            Mr. Daly stated we suspect they are using water outside.

            Mr. Cassel stated irrigation only.

            Mr. Daly stated only irrigation right now because you know what is going on in the inside.  I get reports that say extremely high or extremely low.  We check it out and it might happen to be a toilet or something like that.  It is the outside part that we were missing the boat on.  We decided to look at that and opposed to just changing meters willy-nilly we are paying attention to some of the establishments that have a vested interest in how they look.  

            Mr. Fennell asked do we have any kind of a cap on meters that can look at flow?

            Mr. Daly responded yes. 

            Mr. Hanks asked is that the Doppler meter?

            Mr. Daly responded yes, which is probably what we should do now.  We actually just purchased it.  We were renting it.  We found out it would be less expensive to purchase it and we will have many years worth of use out of it.

            Mr. Hanks asked are we tracking the age of the meters and deciding which ones to bomb out?

            Mr. Cassel responded yes.  We are on a ten year meter replacement program.

            Mr. Daly stated in the past couple years have budgeted $75,000 each year for large meters.  This year we are starting on the smaller meters, the house meters; however, we went into a little side cut where we found out we had some lift stations that did not have backflows on them.  We paid attention to that.  It is where a lot of the money went to and a lot of the time.  We are getting back on track.

            Mr. Hanks stated safety comes over profit.

            Mr. Daly stated I agree.

            Mr. Fennell stated Mr. Johnson mentioned earlier about using water from our own plant to do some things on the other side.  Do you meter that in any way?

            Mr. Macintosh responded no.

            Mr. Cassel stated you meter what goes off the site.  What Mr. Macintosh and they are using is not off of that number.

            Mr. Macintosh stated the water in this whole compound is not metered. 

            Mr. Stover stated you are metered on the way into the wastewater plant and you are metered going into your injection well. 

            Mr. Fennell stated once again there is another opportunity for cost savings. 

            Mr. Daly stated we are working on the irrigation ones right now.  We are going to go through that and see what we can find out.  We are going to see if we can find some people who do not have a problem watering like crazy, but will have a problem when they have to pay for it.  We now have the Doppler and we will see what happens. 

            Mr. Johnson stated just a word of caution.  The Doppler works on wastewater flows.  You would need an ultrasonic meter to monitor water overflow.

            Mr. Cassel stated you do have the other meter calibration that you can stick your adaptor on to check the meter against your calibrated meter.  We have ways to check to see if the meter that is in the ground is registering properly.

            Mr. Fennell stated it sounds like you obviously need to do this.  We are talking 12%.  I would suspect 1% to 2% is normal.

            Mr. Cassel 5% is the industry standard.  We need to eliminate the fact of whether we have meters we are not billing for and if we have meters where consumption is occurring, but there is not enough volume to trigger the meter accurately.  Once we eliminate those and take them out of the calculation we will see what really is our loss in our distribution system. 

            Mr. Fennell asked once water leaves the plant do we have any other large meters out there for one of the major pipelines or any other way of judging the flow down the lines?

            Mr. Daly responded distribution wise; probably not. 

            Ms. Zich asked is there any way that someone can fool with their meters so they can use a lot of water and it would not show?

            Mr. Daly responded there used to be an old trick way back when.

            Ms. Zich stated I know people do it with electricity and their television.

            Mr. Daly stated our registers do not pop off with just any kind of screwdriver. 

            Mr. Stover stated that would be minimal anyway.  An other issue is the fire department.  They do a lot of flushing and training.  They use quite a bit of water that is not metered.

            Mr. Daly stated there is really no way to find out when they do it because it is always after the fact.  They do not have that kind of communication with us right now. 

            Mr. Hanks asked do you ever see them flushing hydrants?

            Mr. Daly responded I personally do not.

            Ms. Zich stated I do not either. 

            Mr. Stover stated every once and a while we get a call from the police department telling us the fire department is out flushing hydrants.

            Mr. Hanks stated I do not think that would account for 12% day in and day out.  Is our distribution number accurate?

            Mr. Stover responded yes.

            Mr. Daly asked is it calibrated quarterly?

            Mr. Stover responded it is calibrated quarterly. 

            Mr. Hanks asked what is the bill rate per 1,000?

            Mr. Daly responded it is like $3.15.  We have three increases and we are going to have three more.

            Ms. Zich asked what do you mean?

            Mr. Daly responded it was in our bond report.  It said even if we did not do phase two we would probably have to come through with a 3%, 4% and 5% increase.

            Ms. Zich stated I remember the first increases, but I do not remember that we were going to do any more after that.

            Mr. Daly stated I was reading through it the other day and it says even if we do not do phase two, we will have to do these three incremental increases.  We have been miserly and we have paid attention to every dime so we may not have to.  We might have $6 Million sitting there that did not go for this project, which could pay the bonds down.  There are different ways of looking at it.  Mr. Cassel is on board with seeing what we really need to do and analyzing this as opposed to going by a document that is 40 years old.  There were so many assumptions made when that was written and many things have changed. 

            Mr. Fennell stated it sounds like this needs a lot of attention.  Thank you for doing this.  This is another case of seeing if we have to keep both plants alive because we need additional back up.  If you can actually find another 7% to 10% of water, that can go a long way towards back ups, capacity and reserves. 

            Mr. Cassel stated or at least we can make sure we get paid for it. 

            Mr. Hanks stated if we find where those losses are and bring it down from 12% to 5%, we are looking at bringing in perhaps $375,000 a year in lost revenue.

            Mr. Cassel stated this is why we are trying to narrow it down to see where those losses are internally as to where we are coming up with the numbers.  What is real. 

            Mr. Hanks asked would it also be another $3 on sewer rates?

            Mr. Daly responded yes it would. 


·         Utility Billing Work Orders

            This item is for informational purposes.


            B.        Attorney

            There being no report, the next item followed.


            C.        Engineer

·         Project Status Report

            Mr. Johnson stated it is my understanding you wanted to have an update on what is going on with the infiltration construction.

            Ms. Zich stated we would love it.

            Mr. Bulman stated I can give you a few minutes.  I can honestly say everything is good right now with the deep well.  Construction is good.

            Ms. Zich asked is it finished?

            Mr. Bulman responded it is not finished.  The monitoring well has to be plugged and abandoned.  Right now we are collecting data from both monitoring wells.  All of that is going to DEP so they can look at it because they want to carefully consider removing any data point.  Plugging and abandoning the monitoring well, which we are authorized to do under the current permit, is still something they need to give us final authorization on based on the construction of the monitoring well #3. 

            Mr. Fennell asked we put another monitoring well in, right?

            Mr. Bulman responded yes.

            Mr. Cassel stated we are plugging and abandoning monitoring well #2 because we installed monitoring well #3.

            Mr. Hanks asked was monitoring well #2 leaking?

            Mr. Cassel responded monitoring well #2 was a dual zone.  One of the zones went bad.  Initially they were going to put a monitoring well in that was only a single zone monitoring well, but during the process of evaluation we realized there was an interconnection between the other two zones and monitoring well #2.  This made it a non useful monitoring well.  This is when we changed monitoring  well #3 to a two zone monitoring well.  We just installed it.  Both zones are working.  Both zones have met all of the criteria.  They have flown through all of the test qualifications and criteria standards.  Until DEP is satisfied that the monitoring results off of the new monitoring well are good, accurate and stable they will not give us permission to abandon and plug the old monitoring well.  That is the stage we are in right now.  Everything else is tied in.  All of the telemetry is tied in.  Everything is going back to where it is supposed to be going.  We are down to the final aspects of DEP saying they agree with the data we are sending them and that we can go ahead with plugging and abandoning the monitoring well as well as the little wells we had to dig when we were doing the initial drilling of the well. 

            Mr. Bulman stated it is a formality at this point. 

            Mr. Fennell asked did we ever have another back up injection well out there?  We said we could not put enough stuff down there.  The well was fine, but somehow something got lost in the pipes.

            Mr. Bulman responded that is the evaluation we are doing now.  What they did last month is replace the flow meters on injection well #1, which is the older one.  The back up.  Now with reliable flow meters, that component of the work is done and we can evaluate the rest of the system to start solving where the problem was. 

            Mr. Fennell stated so we still do not know yet.

            Mr. Bulman stated we still do not know.  It is still in process.

            Mr. Cassel stated we are gathering the data and telemetry so we can make an appropriate assessment of the issues. 

            Mr. Bulman stated we will have to do a hydraulic model with the pump curves, the system, the lines and everything to determine exactly what is going on and why we cannot get water down the well.

            Mr. Fennell asked did it ever work?

            Mr. Bulman responded it was not tested at rates high enough to determine whether or not it could take that amount of water.  For years it was believed that you tested it at this rate and everything was fine, but during the course of the MIT in May we said we had to bring it up to a higher capacity to get rid of that water when the primary well is offline.  Operation said it could not happen.  It could not go any higher.  The question is; why?

            Mr. Fennell asked or why should it?

            Mr. Bulman responded it is rated at a higher capacity and it needs to have a higher capacity for redundancy.

            Mr. Fennell stated now you are at a point to where you can actually look at the flows and you can see what is flowing.  In the end you are going to have to try to inject down that to see.

            Mr. Bulman stated that is the process of what we are gathering right now. 

            Mr. Fennell stated okay now the nanofiltration construction status update.

            Mr. Johnson stated I hoped to discuss this with you last month when Mr. Brown was here.  I had flown back from Colorado and got in about 15 or 20 minutes late and missed him.  Then I had to fly back out at the end of the meeting so I was not able to present some of this information. 

            Ms. Zich asked is this updated as of now?

            Mr. Johnson responded yes.  I am going to talk about the current status and where we are. 

            Ms. Zich stated it actually looks like a lot is going on out there.

            Mr. Johnson stated I am going to walk through some of our schedule issues, the status and contract.

            Mr. Cassel stated they were actually pumping some concrete and making some headway.

            Mr. Johnson stated they are actually starting to move right now.  One of the issues we had during this project is we have been having a tough time administratively with the contractor.  That goes from getting schedules, submittals, timely progress payments and what have you.  When Mr. Brown comes in here, you ask if there is anything you can do to help and they say to pay them; he is kind of his own worst enemy.  We have been working on this project and it took a while to get from the contractor a baseline schedule. 

            What we use a baseline schedule for is to judge project progress throughout the duration.  There was a significant amount of back and forth with the contractor so we could try to establish their baseline schedule early on in the project.  The preliminary schedule should be ten days after the notice to proceed.  The notice to proceed was April 3, 2009.  So fast forwarding it was approved October 15, 2009.  The detailed progress schedule, which then becomes the baseline that everything is judged against, should be within 60 days of the notice to proceed so you can get an early count for how your project should look or what you need to judge yourself against on the project.  Fast forward to November 6, 2009; that is when we finally got the approved baseline schedule. 

            There have been a lot of problems along the way with trying to gage the contractor’s progress on this project simply because there has been all of this back and forth.  That bleeds over into the progress payments.  On a construction project there are a number of things we need to have in order to be able to gage progress and then pay them accordingly.  One of those things is the schedule, but there are other things which factor into that including progress documentation, project progress narratives and things like that.  There has been iteration for the duration of this project in trying to incrementally get forward to where we have all of this documentation that we need for our progress payments.  Mr. Cassel has been there and it is pretty interesting.  We have been saying that in order to get paid they need to have this documentation.  If you do not do the documentation and the administrative things, we are not going to pay you.  They would just sit on it and it would drag out. 

            Mr. Fennell asked why would they do that?  Obviously you are holding their money.

            Ms. Zich responded that is what I have seen out here.  It just does not look like anything is happening.  I know there is a lot of underground work, but you are talking April of last year. 

            Ms. Woodward stated the documentation that gets turned into us, up until the last month, has been inaccurate, late, not fully supported and returned to them because it cannot be processed.  The payment problems do not exist here.  They exist with Intrastate Construction and Lazlo in the scenario.

            Mr. Johnson stated it is push, pull and drag to try and get what we need.

            Ms. Zich stated I thought we used these people because they have done so much work for us in the past.  I would have thought that by now they would have gotten the idea that in order to get paid you need to have everything.  Have your ducks in a row and you will get paid. 

            Mr. Cassel stated from my perspective coming in and not having dealt with them, except at the tail end of the last project; when I came on board in April they were supposed to have been done four to five months later with the last project.  It was a year later before we finally got the documentation from them to close out the $6.9 Million project. 

            Ms. Woodward stated that was after requesting the closeout documentation every month for six months. 

            Ms. Zich stated this is why I am concerned.  As I keep getting these vibes, I do not get vibes like everything is going like clockwork; like it needs to go.  I have been in construction for a long time too.  If you do not have this done, this done and that done, you do not get paid.  I am not seeing it get done fast enough out there. 

            Mr. Johnson stated I think there is a yin and a yang this.  I cannot speak for the contractor, but maybe it is looked at as the administrative side of things is not as important as getting the job done.  In our opinion…

            Ms. Zich stated both are important.

            Mr. Johnson stated that is correct.  Here we kind of have a yin and a yang where they are saying they cannot get this done completely because they are not getting paid fast enough.  We are not going to pay them until they give us what we need with the payment applications and all the processes. 

            Ms. Zich stated I am disappointed because I thought the reason we were using these people is because they had been on our projects before and they knew what we expected. 

            Mr. Cassel stated I am not sure that the level to which we are holding them accountable on this project was the same level to which they were being held accountable on other projects.

            Ms. Zich stated someone should have thought about this before we gave them the contract.                     

            Mr. Hanks stated it is also subject to bidding requirements.

            Mr. Cassel stated you have your bidding requirements.  They have performed.  They got the projects done.  There was really nothing to say to not award them the contract.

            Mr. Hanks stated welcome to bidding requirements.

            Mr. Cassel stated yes.  They have begrudgingly improved with the last two payments; nine and ten have been coming in the door accurately.

            Ms. Zich stated I wish I was getting a nice feeling about this.

            Mr. Johnson stated you and me both.

            Ms. Zich stated I am glad Mr. Johnson is saying that because I have not been happy with the way things are going and I was afraid that it was just me being an accounting person; wanting the ducks in a row.  I am not as happy as I wanted to be about this project.

            Mr. Fennell stated there should be somebody on their side who is interested in cash flow.

            Mr. Johnson stated I do not want to get into this public thing and bash the contractor, offering up a subjective analysis of what is going on here.  The reality of the situation is that as the owners representative we have a limited ability to dictate their schedule, their means and their methods.  We hold them to meet the requirements of the specifications.  We cannot direct them.  We can advise them.  Once we direct them, CSID or CH2M Hill are on the hook at that point because we are overstepping our boundaries.  We cannot tell them how to do this.  Our status as of November 15, 2009 is the contractor is behind 25 days on substantial completion and five days on final completion.  If you look at five days on final completion, it is really not that far over.  Again, we cannot tell them how to put their schedule together.  We can only comment on their schedule.  We are in the process of reviewing December and January.  The scheduler that was working on this had to take a leave.  I am finding a replacement scheduler right now, which I should have tomorrow to start reviewing December and January’s schedules.  We will have comments back to them.

            Mr. Hanks asked when you say the District and CH2M Hill is on the hook if we start directing them, are you referring to acceleration?

            Mr. Johnson responded what I mean is, “you should sequence this instead of that” because the minute we tell them how to sequence something that they should be able to do this in this time, then all of a sudden we are responsible for their schedule.  We cannot do that.  Once we see there is a problem with the schedule and they are behind schedule, there are mechanisms in the contract for them to have to men load, re-baseline and figure out ways to get it done in time.  There are mechanisms and once December and January have been vetted I am pretty sure that is the course we will be taking.

            Mr. Hanks asked when are we looking to have things completed out there?  What was the contract completion date?

            Mr. Johnson responded the contract completion date for Plant F is April 3, 2010.  From our estimates it looks like they will be done on Plant F in time.

            Mr. Hanks asked okay and on the nanoplant are we looking at some time in 2011?

            Mr. Johnson responded we have a January 24, 2011 final completion date.  We have a November 24, 2010 substantial completion. 

            Mr. Hanks stated so almost exactly a year from today they should be done.

            Mr. Johnson stated what is happening on the November 1 schedule is they are compressing the time between substantial and final completion.  We gave them 60 days between substantial completion when the plant should be up and running, you should be producing water, and final completion.  As it stands right now I cannot say they are behind schedule other than to say they are slightly behind.

            Ms. Zich stated I just want you to be aware and keep it going.

            Mr. Johnson stated believe me, time is money.  If it were us at CH2M Hill, it would be a different story.

            Mr. Hanks stated you can remind them what the contract schedule is and what the contract completion date is, but you cannot tell them you need to do this.

            Mr. Fennell asked do you have someone onsite?

            Mr. Johnson responded yes.  He documents everyday.  My man on the field has done a terrific job of documenting, making sure the specifications are followed and the contractor is meeting the requirements of the specifications.  Things are getting built correctly.

            Ms. Zich stated that is good.

            Mr. Johnson stated if anything, I would say we are really on top of that.  That is the most important thing; to make sure this is done correctly.

            Mr. Fennell stated my only comment is that this is January 25, 2010.  The last time you really had a schedule understanding was two months ago.  If someone is out there checking the work, there should be a schedule in front of you where it is just a matter of you checking it off. 

            Mr. Johnson stated when pay applications are submitted to the District for processing that is when we see the progress schedule.  If we are on a normal payment schedule, they submit on the 15th of the month the progress documentation, the schedule and the payment application. 

            Ms. Zich asked did we get it for January?

            Mr. Johnson responded yes.  We got that schedule.  The problem we are facing is the December payment application came in the first week of January.

            Mr. Fennell asked are you using accounting to keep track of the schedule?

            Mr. Johnson responded that is when the contractor submits the schedule.

            Mr. Fennell stated but you should be looking.

            Mr. Cassel stated they are looking at the schedule on a daily basis from what has been provided.  What happens is when he puts in his schedule for the payout against what was done, they need to go back and look at it, compare it against what the base schedule was, how much flow time, are they on schedule, how many days behind their schedule on each item they are.  They have to do that analysis on a monthly basis as well as looking at it daily.  They cannot say, “you need to do this, you need to do that”.  All they can say is it said there was concrete to be poured and no concrete was poured.  They make their daily reports and then go back and say you are so many days behind.  What are you going to do to fix it?

            Mr. Fennell stated there is a real schedule and there is a payment schedule.  The real schedule is the key.

            Mr. Johnson stated the schedule is considered a submittal.  That points to one of our other issues.  We have a number of submittals we require to review what they are proposing.  Let us say they are proposing to install a certain piece of equipment that we specified in our specifications.  We receive it.  Our engineers look at it and say it is good or no it is not and this is what you need to do to correct it.  This is another example of administrative issues.  We have been having trouble getting submittals out of them for the duration of this project.  I think we are on top of it now, but with the schedule being another submittal; dragging it out of these guys, aside from us going into their trailer and doing it for them, our people are limited on how to enforce them to do this.

            Mr. Fennell asked where is your guy at?  Is he in a trailer?

            Mr. Johnson responded yes.

            Mr. Fennell asked but they are not in the same trailer?

            Mr. Johnson responded no, not the same trailer. 

            Mr. Fennell stated I have done joint projects with other companies such as Seiko and HP.  You actually get to a point where you have your people working in the same place at the same time and doing the same thing. 

            Mr. Johnson stated there are two trailers there.  There is the engineer’s trailer where he has all of our as built drawings, our submittals, our CMs, our inspectors or what have you.  They have their trailer where all the contractor’s magic happens.  Just a quick look ahead; we received the contractor look ahead before our construction progress meeting, which we are having on Wednesday.  The list of items for the look ahead; you are in piping, installation of underground electrical, place and finish standby generator slab, it looked like they had actually done that when I came through the gates today so we are seeing an uptake in activity, but it has taken some effort to get to this point.  The wastewater treatment plant we have taken a look at.  We feel pretty comfortable that they are going to be able to finish it on time.  A lot of this is internal to the wastewater treatment plant so we feel this is going to be something they can meet.  The problem is the nanofiltration plant.  Again, until we have something more to say that they are not going to meet the schedule we have to take their cues.  This is at the top of our priority list right now; getting the December and January schedules.

            Mr. Fennell asked are there any questions?

            Ms. Zich responded it sounds as good as it can be. 







SEVENTH ORDER OF BUSINESS                      Approval of December Financials and Check Registers

·         Summary of Cash Transactions

·         Projected Cash Flows

·         Engineering Projects

            Mr. Fennell stated we still have a little money with the SBA.

            Ms. Woodward stated yes.

            Mr. Fennell asked is it about $75,000?

            Ms. Woodward responded yes.  We basically wait each month or sometimes every six weeks, whenever they transfer funds out of the toxic asset fund into Fund A and then we transfer it into our operating funds.  The last estimate that I have seen is they expect it can take as much as five or six years for the rest of the funds to free up. 

            Mr. Fennell stated it is amazing to me that its not a major issue in the press. 

            Ms. Zich stated on the assessment collections; that is incredible.  We collected almost all of our money for the general fund.  People are paying their property taxes.  I was talking to Ms. Woodward about it.  Interest rates are so low now that if you have the funds, you are not going to get any more money in the bank.  You might as well pay your property taxes.  I think a lot of people feel that way. 

            Mr. Hanks asked do a lot of people pay through the escrow account on their mortgage?

            Ms. Woodward responded but that was also true last year.  Apparently something has leveled off out there.  Something has changed.  We are basically about $200,000 ahead of where we were last year on collections.

            Ms. Zich stated things are looking good there. 

            Mr. Fennell asked what happened?  Did the county decide to really tighten down and get the money or something?

            Ms. Woodward responded I do not think they do anything different.  They send out the notices and people pay however people are paying.

            Ms. Zich stated it is not just people.  It is businesses too. 

            Mr. Cassel stated business and banks.

            Ms. Zich stated when you think business and banks, you are not getting any money if it is sitting there.  You get a percentage off for every month you pay your taxes early. 

            Mr. Fennell stated I was looking at our operating flows; total expenditures and revenues.

            Ms. Woodward asked on what fund?

            Mr. Fennell responded water and sewer fund.  The total expenditures prorated was going to be $2.5 Million.  We are only at $1.4 Million.  The next line down for excess revenues is prorated to be negative.  Is that just an error?  Are we making any money or not?

            Ms. Woodward responded you are fine on that.  The issue is when you come down to the excess revenue line one of the items which normally goes into that also includes some of the computations on your reserves.  Also, there will be a major discrepancy when you go back to the debt service on principal and interest payments.  What happens there is because we are still on the construction phase on our project we are capitalizing interest expense.  So while we budget that we will spend it as an expense it actually gets reclassified up into the balance sheet. 

            Mr. Fennell stated as a negative expense, which is positive. 

            Ms. Zich stated it is difficult to understand.

            Mr. Fennell stated it is the expenses which are negative.  Are we in good shape?

            Ms. Woodward responded we are good.  One of the things Mr. Daly and I spoke briefly about is that this will probably be a good year, when we go through our budget process for next fiscal year, to attempt to do a true up on the budget for the current fiscal year and do a budget amendment mid year.  Simply because we have certain changes within the engineering portion of this.  Hopefully by the time we get to March we will have some indication of whether or not the feasibility is going to result in items becoming capital in nature versus operating expenditures.  Also, one of the items you might have noticed as you went through the financials is that while our general liability insurance has been capped and is doing very well in total, the portion we have allocated to the general fund versus the water and sewer fund has been flipped slightly so that we will be under budget on the general fund and over budget on the water and sewer fund.  When we renewed the insurance this year we did a physical inventory of all the assets being insured and we recomputed the appropriate percentage of the premium, which should have been charged between the two.  We found that in the past years we were too heavily skewing it towards the general fund.  This will allow us to true it up so that it will more accurately reflect what is going on in your financials.

            Mr. Fennell asked I do not know if you can do this or not, but when I look at the excess revenue can I have another line in there that puts it in without the capital costs?  I just want to look at the operation and see if these guys are doing the right thing as far as running the plant efficiently. 

            Ms. Zich responded you can look at just the field operations and see that.  That is what I do.  I look at them individually and then it is not as confusing. 

            Mr. Fennell stated I am just suggesting a line called total operations and you can add in the additional capital.  I know from your standpoint all money is money, but for me I see it as how can I judge how these guys are doing.

            Ms. Woodward stated let me check and see what I can do with that.  Part of this happens to be the nature of government budgeting.  Where you are really flowing over on this is the fact that you have $907,000 which is showing as a prorated budget amount as an expenditure for debt service.  If you take that $907,000 out and add it back to the negative $500,000, you are really in the black by $400,000.  That is really what you are looking at.

            Mr. Fennell stated I see debt service like paying bondholders and paying maybe the owner, or something like that, above and beyond what the operations are doing.

            Ms. Woodward stated except in the case of the water and sewer fund where your debt service is in fact part of your operations.  It is not the same debt service as in the general fund and general obligations.  That is why it is presented this way. 


On MOTION by Ms. Zich seconded by Mr. Fennell with all in favor the financials and check registers for December were approved.


EIGHTH ORDER OF BUSINESS                         Adjournment

            There being no further business,


On MOTION by Mr. Hanks seconded by Mr. Fennell with all in favor the meeting was adjourned. 






  Glen Hanks                                                                  Robert D. Fennell                              

  Secretary                                                                       President