SLVWD Board Meeting Summary
November 16, 2023
Mark Dolson
Highlights:
Proposition 218 Outreach
Change Orders for Alta Via Drive Main Replacement Project
Alta Via Drive Main Replacement Project – Monan Way Solider Pile Wall
Recent Interactions with Big Basin Water Company (BBWC)
Lompico Canyon Emergency Evacuation Route Project
Next Board meeting is at 6:30 PM on December 7th
Preliminaries
All five Directors were present; Director Ackemann participated remotely.
There were no actions to report from the Closed Session prior to the meeting.
There were no additions or deletions to the agenda, but the order of items was revised to accommodate Director Ackemann who had to leave midway through the meeting.
There were three public comments on items not on this evening’s meeting agenda. Jim Mosher (Felton), Mark Dolson (Ben Lomond), and Larry Ford (Felton) spoke on behalf of the local citizens’ group Friends of San Lorenzo Valley Water to advocate for increasing the monthly discount (currently $15) provided by the District’s Ratepayer Assistance Program (RAP) to an amount in the range of $20-25 (with provisions for further increases). The speakers presented two arguments for increasing the discount. First, they noted that the State of California has recognized reliable access to safe, affordable water as a fundamental human right (even though the State has yet to allocate significant funding to ensure affordability). This places the onus on the District to ensure affordability despite increasing costs, and the current discount is arguably insufficient. Second, the Board has worked very hard to minimize the impact of the new rate structure on low- and middle-income households, and the RAP is a currently underutilized tool that can be employed in partial pursuit of this objective. The fact that the RAP is currently undersubscribed (the allocated $25,000 could accommodate almost twice as many ratepayers, and significantly more than this are believed to be eligible) suggests that it is under-publicized and/or too small to matter. The Friends suggested three different possible revisions including a discount equal to 50% of the base rate (as is the case for East Bay MUD) or an increase in the discount equal to the increase in the base rate. The new discounts would be $24 and $23, respectively, and would increase each year. A significant increase in the number of customers signing up for the RAP would signal to the District that this is a meaningful response worth explicitly budgeting for.
New Business
Proposition 218 Outreach
Acting District Manager Carly Blanchard introduced this agenda item. She reported that the Administration Committee met on November 3rd with the District’s PR firm, Miller Maxfield, and approved a mailer to be sent November 27th to inform the public of the upcoming Board vote on the new rate structure scheduled for the December 7th Board Meeting. She said that a social media post was under preparation, and a detailed FAQ was being put together.
Director Ackemann, Chair of the Administration Committee, added that the committee had concluded that the time available prior to the December 7th meeting would be better spent publicizing that meeting than rushing to hold an intervening special rate-structure-specific meeting. She also mentioned that there will be additional public outreach after December 7th.
Director Fultz argued that the District should be planning to do more to engage transparently with the community. He said he had noticed in 2013 and 2017 that people tend to come to the hearing with questions about how to vote. He felt that an additional meeting was called for between the December 7th Board vote and the Proposition 218-mandated public hearing in February. He urged the District to go beyond the legally required minimum outreach to allow for a more interactive public workshop designed to encourage questions with accompanying discussion. He also objected to the planned mailer where, he said, the sales pitch would highlight the need for infrastructure investment, but the reality would be that most of the money would likely go to increased operating expenses.
Director Mahood agreed about the need for a targeted workshop. She said she found it very uncomfortable to have people showing up for the Fire Surcharge meeting with honest questions that were difficult to accommodate. She said people only really pay attention when they get the notice of the rate increase in the mail, and the District needed to address this with a workshop/community meeting in the following 45-day period that was fundamentally different from a Board meeting.
The ensuing discussion was partly aimed at clearing up some lingering confusion about the current plan. Carly said Miller Maxfield was ready to support a workshop with whatever materials are needed. Director Ackemann said more than one mailer would be sent out, one before December 7th and one after. She said the Administration Committee would look at dates for a workshop in January, and she suggested that this workshop would be different from a Board meeting and would be led by Staff.
Director Fultz repeated his objection to a “sales job.” He said ballot measures are usually accompanied by both a pro and a con argument, and he wanted to know what opportunity there would be for his dissenting view to be expressed. Director Ackemann said Board members have lots of opportunities to offer their views, including at Board Meetings. The point of a public workshop is to hear from the public, not the Board. President Smolley suggested that Board members might be able to participate in a workshop on the same terms as members of the public. Director Ackemann said the Administration Committee would discuss this.
There were two public comments. Jim Mosher (Felton) said he was pleased to hear about plans for a workshop. He urged the District to address two particular deficiencies in the current messaging about the proposed new rate structure: (1) the minimal impact on the school district, and (2) the substantial increase in the cost of heavy summer use (as opposed to winter use). Director Fultz supported this latter recommendation.
Mark Dolson, a public member of the Administration Committee, sought clarification on two rate-increase-related topics that were left unresolved at the November Administration Committee meeting: (1) what was the plan for the public presentation at the December 7th Board Meeting? (2) what was the plan for enabling further Administration Committee review and input on future public-facing presentations? (The Administration Committee did not see any useful role for Raftelis in either of these.) Interim Finance Manager Heather Ippolito said she would be presenting along with Raftelis on December 7th.
Director Ackemann moved to accept the Staff report on Proposition 218 outreach plans with corrected dates and with a commitment to return to the Board with a plan for a public outreach workshop to be held between December 29th and February 15th. Director Mahood seconded this. Director Fultz said he appreciated the good intention, but he would need more specificity in order to support this.
The motion passed 4-1 with Director Fultz opposed.
Change Orders for Alta Via Drive Main Replacement Project
District Engineer Garrett Roffe introduced this agenda item. Staff was seeking and recommending Board approval of three change orders submitted by Anderson Pacific for work performed in the Alta Via neighborhood (including Alta Via Drive, Monan Way, and Prospect Avenue) to replace above-ground water mains destroyed in the August 2020 CZU Fire. The project replaces a current temporary solution and also greatly increases the number of fire hydrants in the neighborhood. Anderson Pacific has been performing well with minimal delays and no issues from local rate payers. They are requesting additional payment for: (1) increases in the cost of ductile iron pipe ($65,717.89 approved by the previous District Engineer), (2) redirecting a water main in response to a failing culvert ($7,405.52), and (3) dealing with an unforeseen conflict involving an existing water main ($20,619.28). The total request was for $93,742.69, 90% of which will be reimbursed by FEMA.
The Board members all appreciated the clarity of the memo in the Board packet and the fact that Garrett was now tasked with cleaning up issues that predated his arrival. Director Hill observed that the culvert was technically the County’s responsibility, but nobody saw much benefit to trying to involve the County.
Director Mahood noted that the increase in cost was well above the $30,000 authorization limit of the District Manager, and Garrett agreed that this should have come back to the Board for approval. Director Fultz added that future contracts should clarify limits on material cost escalations.
Director Mahood asked how the District had failed to correctly identify the location of the existing 1.5” pipe. President Smolley said that many pipes this small are plastic and wouldn’t be detected by a magnetometer.
Director Fultz asked if there had been any noise issues with Anderson Pacific. Garrett said neighbors were perturbed with construction staging near former director Rick Moran's house. Director Fultz said he was more concerned with the free ride on paving that the District was giving the County. President Smolley said he didn’t think the District could go back to the County after the fact, but he planned to address this in an upcoming Engineering and Environmental Committee meeting.
President Smolley moved to direct the Acting General Manager to amend the contract with Anderson Pacific to include the three requested change orders. The motion was seconded, and there was no public comment.
The motion passed 5-0.
Alta Via Drive Main Replacement Project – Monan Way Solider Pile Wall
District Engineer Garrett Roffe introduced this agenda item. Staff was seeking and recommending Board approval of up to $198,900 to Anderson Pacific for construction of a soldier pile retaining wall along Monan Way. The approved project included asphalt paving after the completion of the underground work, but this was complicated by an existing road failure. Staff contacted Haro, Kasunich and Associates for a proposal to perform a geotechnical investigation and design of a steel beam soldier pile retaining wall at the compromised road location. The plans for the proposed retaining wall costing up to $198,000 were provided to Anderson Pacific.
The Board struggled to understand both why the District should pay for this and what other options had yet to be considered. This area burned in the CZU Fire. Prior to that, there was above-ground HDPE pipe, and there is now new above-ground HDPE pipe as well as even more recently installed buried pipe that is connected to the houses. Monan Way is a private road which is in very poor condition. The problem is that there was a road failure during the storms this past January in a location that the geotechnical engineer said had clearly failed before, and the District can’t pave beyond the failure unless it builds the wall. There are seven water meters beyond this point, but some homes are no longer standing.
President Smolley said the Engineering and Environmental Committee had requested competitive bids, but these had not been sought. Director Mahood said she was having a hard time seeing why this was the District’s responsibility. She said she would like to see some alternative solutions.
Director Fultz agreed but said he didn’t think the homeowners could handle this on their own. So long as this wasn’t considered a gift of public funds (which it apparently was not), he thought the District should step in just this once. Director Fultz moved to proceed with construction, and Director Hill eventually seconded this.
Garrett and Carly argued that the project could not proceed without the wall. They said the contractor wouldn’t pave, and they worried that the District would be blamed for any future failure.
There was one public comment. Eric Martin of Boulder Creek said it sounded to him like the District was talking about making capital improvements to private property.
The motion failed 3-2 with Directors Ackemann and Fultz voting in favor.
Unfinished Business
Recent Interactions with Big Basin Water Company (BBWC)
President Smolley introduced this agenda item. He said the information in the Santa Cruz Sentinel article of November 5th describing a November 2nd Big Basin meeting came as a surprise to him. He said he knew that the District had a pipeline connection with BBWC, but he didn’t know the District was providing water via this connection. He talked with former District Manager Rick Rogers and with Acting General Manager Carly Blanchard to understand what the District was doing with BBWC, and he summarized what he learned in a memo included in the agenda packet. The District is sending water and being compensated by the BBWC Receiver at SLVWD’s standard residential rate of $12.66 per unit (i.e., per 748 gallons). SLVWD Staff are providing support for operation of the intertie and have been doing emergency repairs on the BBW system on an ad hoc basis. This work is being billed to the Receiver, but President Smolley pointed out that the District has not been compensated by the owners of BBWC for work done in the past. The Receiver wants to engage SLVWD for repairs of the system, and wants the District to be able to increase its pumping capacity (presumably so that BBWC can shut down its well for rehab sometime in 2024). President Smolley asked the Board whether it wanted a contract agreement.
Director Mahood said she wanted to make sure that the District covered its costs, including overhead. She said there should be a contract for emergency repairs and for water delivery, and she was concerned about what the District would bill BBWC after the rate increase. Lastly, she said this agreement should be consistent with what SLVWD would do in selling water to Scotts Valley. She spoke with Dave McNair (General Manager of Scotts Valley Water District), and he said SVWD has paid the $12.66 rate in the past. He noted that SVWD and the City of Santa Cruz Water District were in discussion with Raftelis re: an appropriate rate for water delivered via their new intertie. Director Mahood asked whether SLVWD would charge the industrial rate in the new rate schedule, or whether the District needed to develop a cost for bulk water delivery through interties, something Raftelis could help the District to determine.
Director Hill said he had two concerns. First, BBWC appears not to be fiscally solvent. They are awaiting PUC approval of a rate increase, but they are currently losing money. Consequently, the District would need very strict terms on payment to protect itself. Second, the pending pipeline connecting Scotts Valley to the City of Santa Cruz will give Scotts Valley a second option, and the District will need to consider this.
Director Fultz seemed to object to President Smolley’s action. He said it was really unclear to him where the line was between what Staff should be doing and what the Board should be doing. He asked if he could have made this contact himself, and President Smolley said he could not.
Director Fultz said he had also seen mention of the BBWC Receiver being interested in having SLVWD acquire BBWC. He was very concerned that such statements could escalate expectations improperly. He said SLVWD was trying to be a good neighbor, but neither the State nor the County had been willing to put money on the line in the past, and the District would never recover its past costs. He felt it was appropriate for conversations to be conducted entirely by Staff and for the Board to interject itself only with formal Board approval. President Smolley said he had reached out in his role as Board President, but Director Fultz asked for this to be clarified in the Board Policy Manual.
President Smolley moved to direct Interim General Manager Brian Frus (whose first day at SLVWD is November 20th) to meet with the Budget and Finance Committee to discuss a compensation agreement with BBWC. Director Hill seconded.
Eric Martin of Boulder Creek asked who BBWC calls when their system needs to be repaired. He also asked if SLVWD would be compensated on an hourly basis for work that it does on BBWC’s system.
Director Fultz strongly recommended postponing this issue to provide Interim General Manager Brian Frus an opportunity to deal with other things first. He said this was not close to a top priority for him at this time.
Director Hill said he thought it was incumbent on BBWC to come to SLVWD with some kind of proposal. President Smolley said the court-appointed Receiver has already asked Staff to do work, and Staff had asked for a cost estimate. He wanted the rest of the Board to be aware of this. If the Board was okay with this, then he said he had no issue.
The motion passed 3-1 with Director Fultz opposed and Director Ackemann no longer present.
New Business
Lompico Canyon Emergency Evacuation Route Project
District Engineer Garrett Roffe introduced this agenda item. He said the District was waiting for the agreement to return with added language banning the use of glyphosate on District property.
President Smolley said this came in front of the Engineering and Environmental Committee, and the committee recommended that the glyphosate issue be covered.
Director Fultz asked if the amended agreement could be brought before the Board on December 7th. Garrett said the County wanted the agreement executed immediately.
President Smolley directed that this agenda item be brought back to the Board at its December 7th meeting.
Consent Agenda
These items are deemed adopted if nobody pulls any of them for further discussion. Board meeting minutes for October 5th, 16th, and 19th were accepted.
District Reports
Environmental
Director Mahood noted that no bids were received for the RFP for the feasibility study of transporting Loch Lomond water to the Kirby treatment plant. She asked why and what would happen next. Carly said she would reach out to firms the District has worked with in the past to understand why they didn’t respond. She said the RFP was sent to 30 different firms. The District will go back out to bid when it has more understanding.
Director Fultz requested an update on environmental grants. Carly said the District submitted applications for two separate USDA grants for $500,000 each (with a 25% required match over a four-year period). She said fuel-reduction opportunities were slowing, but this could be seasonal.
Engineering
Director Fultz requested an update on the Fall Creek Fish Ladder. Garrett said the District got out of the creek but a little after the October 15th deadline. He said there was still some concrete work pending on the landing and some other work as well. He anticipated that most of this would complete by the end of 2023, but a required motor control probably wouldn’t be received until January, so final plantings and fencing might take place in March.
Director Fultz also sought a status update on the Felton Heights Tank. Garrett said a contract had been executed with the surveyor. When the District receives a document from him, it will proceed with geotechnical investigation and easement. The District may not have permission to get a heavy drill on the property.
President Smolley had a question about Highway 9 Caltrans emergency work. Garrett said this was an oversight on his part. He said the District has a survey, but it doesn’t go all the way because the initial layout didn’t include one of the sites. He said Caltrans is currently occupied with a culvert repair, but they are interested after that, and Staff is working as fast as they can to enable this.
There was one public comment. Alina Layng of Boulder Creek said she had only seen pictures of the new Fall Creek Fish Ladder, but it looked to her like it ended up with a beveled edge rather than the 4” radius that she had advocated for lamprey passage. Carly said the beveled design had been approved by the state fisheries agency as meeting requirements for lamprey passage.
The meeting adjourned at 8:30 PM.