SLVWD Board Meeting Summary
September 5, 2024
Mark Dolson
Highlights:
Big Basin
Bracken Brae and Forest Springs
Board Meeting Schedule
Next Board meeting will be at 6:30 PM on September 19, 2024
Preliminaries
All five Directors were present. There were two public comments prior to the Closed Session.
Jim Mosher of Felton thanked the Board for the work that it does. He said he was speaking on behalf of 21 ratepayers who signed a letter that he previously sent to Board Members. Rather than reading the letter (which urged the Board to promptly install a new Interim General Manager and to greatly expand public access to relevant background information), he said he wanted to explain what led the letter to be written. He said Board meetings in recent months have frequently been confrontational and disturbing in tone. With regard to the General Manager position, he said valley residents have generally not felt competent to insert themselves into personnel decisions, but they did recently learn that Rick Rogers could be available to return. Then, when it was discovered that Brian Frus was gone and there would be no General Manager for the foreseeable future, these residents felt compelled to speak up. The letter itself defers to the Board as to whether Rick is the best choice for Interim General Manager, but it urges that this position be filled as immediately as possible. Also, communication from the District and the Board has been so minimal that the public is being left in the dark during a time when an emergency could arise at any moment. The letter signers therefore hope the Board will schedule an Open Session agenda item as soon as possible.
Director Fultz offered a brief clarification: he said Brian Frus’s departure was a resignation.
A speaker from Boulder Creek said she appreciated District Engineer Garrett Roffe's recent support in helping the Bracken Brae project to move forward. She was also grateful to the entire Board and looking forward to the day when Bracken Brae can have a stable water supply.
At the start of the Open Session, President Hill reported that in the just-concluded Closed Session, the Board accepted the resignation of former Interim General Manager Brian Frus and was now actively seeking a new Interim General Manager.
There were four public comments on non-agendized items. Debra Loewen of Lompico Canyon said she wanted to share something from a local Fire Safety group. She reported that a grant program has become available to low-income CZU Fire survivors. Two-person households below $72,000 annual income are eligible.
Robert Watkins, a Big Basin customer, said the Board has a copy of a survey of Big Basin customers with a 90% response rate. They are seeking a municipal solution in place of their current failing system, and they encourage and appreciate any consideration to connect their system with SVLWD.
Rick Moran of Ben Lomond said he joined the Environmental Committee eight years ago and was proud that the Fall Creek Fish Ladder project is now finishing up. He talked about the many people who have contributed to this effort.
Ann Thrift of Boulder Creek said she was a Big Basin water customer who was pleased that SLVWD is now considering consolidation, as the company has been a mess for over four years now.
Unfinished Business
None.
New Business
Valley Gardens Offsite Sandhills Mitigation
District Engineer Garrett Roffe advised that Staff wished to remove this item from the agenda. There was no further discussion.
Big Basin Consolidation Reimbursement Agreement
President Hill introduced this agenda item. He said the Board was being asked to provide comment on an agreement, drafted by Legal Counsel Barbara Brenner, between SLVWD and the Big Basin Water Company Receiver. President Hill said this was not the agreement the Board had requested or expected. He said the District had at various times sold water and provided repair crews to Big Basin Water, but there was no formal contract, and Big Basin is now under receivership. The Board simply wanted an agreement between SLVWD and the Receiver to establish a standard price list and billing procedures.
Director Smolley said he did not recognize his request (from a year ago) in the current document. He said he just wanted something to cover rates and reimbursement, whereas this document made it seem that the District was getting ready to conduct a full evaluation of the Big Basin system.
Barbara said Big Basin had received a grant from the County to evaluate its system, and it was seeking SLVWD Staff input in that assessment. Hence, Staff time devoted to this support will be reimbursed. Director Smolley asked why the document stated that “the District has agreed to support Big Basin relevant to the Project” when the Board had never agreed to provide this support (in part because the District completely lacks the resources to do so). Barbara said the Receiver had requested this language.
Director Largay asked what defined “the Project” in question. The document simply says, “the Project consists of four (4) major tasks, which include providing emergency operation of the Big Basin system and evaluating the Big Basin system to identify the necessary upgrades for potential consolidation with the District’s system.” An attachment lists these as: (1) Project Administration, (2) Water System Emergency Base-Level Operational Requirements, (3) Water Supply and Conveyance System Resilience Development, and (4) Water System Consolidation Support. Director Largay observed that these are not tasks for SLVWD.
Director Fultz said the document gives Big Basin priority access to SLVWD Staff. Director Smolley also asked why this was only coming to the Board now when Big Basin’s deadline for completing their tasks was in just four months. Barbara said the document had been delayed for a few months. Director Smolley said the District couldn’t commit Staff to work on activities that it doesn’t have the bodies for. He said he would much prefer to have a General Manager and Environmental Manager involved.
Director Fultz had very similar concerns. He said the Board unquestionably very much wants to consolidate with Bracken Brae, Forest Springs, and Big Basin. The issue has always been money. The current SLVWD community cannot be responsible for paying for this. He said the draft agreement struck him as way too loose with regard to Service Level Agreements. As a written, it gives Big Basin immediate access to SLVWD, allowing for no pushback. This would be a serious issue even if SLVWD were fully staffed. Director Fultz also expressed concern about the scope of the agreement. He asked what “emergency operation” referred to. Providing water is one thing, but providing Staff is quite another. He said the District needed much better language around exactly what it was signing up for. Also, he said, if Staff were responding at 2:00 AM, the District’s costs would be way above what is listed in the exhibit. Lastly, he expressed grave concern about payment and invoicing terms, given that Big Basin has zero creditworthiness. He said there should be a deposit for SLVWD to draw from to ensure that it is not left holding the bag. He recommended that the agreement be sent to a committee (either Engineering or an Ad Hoc committee).
Director Layng agreed that it would be desirable to have a document that was responsive to the far more limited original Board request. She also wondered if LAFCO could play a role.
Director Largay said he thought it was terrific that the State and County have secured grant funds to help Big Basin through this difficult situation. He also thought it was appropriate to engage in an agreement, as he thought SLVWD would likely have some role in the four listed tasks. However, he said he shared the concerns that had been voiced, and he thought it would be problematic for SLVWD’s cash flow if this was dependent on a reimbursement chain involving Big Basin, the County, and the State.
Bruce Holloway of Boulder Creek called attention to deficiencies in the information provided in the Board packet. He also suggested that Big Basin is not entitled to obtain SLVWD water at standard rates.
Christopher Bradford of Boulder Creek spoke on behalf of Big Basin customers. He said he agreed that a consolidation would pose risks to SLVWD, but he still hoped that it could provide long-term value. As a private company, Big Basin can’t receive government funds, but these might someday become available to a system consolidated with SLVWD.
Director Fultz thanked Christopher for bringing these topics to the table. He said he was extremely hesitant to count on the State without a written commitment. His personal solution would be to have California contribute 50% of the needed funding, have Congress contribute 40%, and have the community contribute 10%.
Director Smolley added that the draft agreement was motivated by an $850,000 grant to Big Basin, but the total cost of consolidation has been estimated to be on the order of $25 million or more, with a detailed engineering evaluation still pending. He asked where this money was going to come from. With SLVWD’s current staffing issues, it can’t even begin to negotiate with the State or other entities. He said the District had already been working for three years to consolidate with two much smaller and closer water mutuals. His conclusion was that SLVWD can’t make the kind of commitment implied by the draft agreement.
Barbara argued that these concerns were off topic.
Nicole Launder Berridge of Bracken Brae said two agreements were needed. A first agreement about operational needs makes sense, but Big Basin can’t get federal funding without SLVWD as the lead agency. This requires a second agreement.
President Hill said he was referring the agreement back to Legal Counsel.
Bracken Brae and Forest Springs Status Report
District Engineer Garrett Roffe introduced this agenda item. He reminded the Board that, in order to make progress with the currently available funding, it agreed at its July 17th meeting to move forward with a reduced scope of work (which became known as the Phase 1 project) on the required infrastructure development for the Bracken Brae and Forest Springs consolidation. Staff met with Department of Water Resources (DWR) management on August 29th to discuss a one-year extension and the use of the current grant funds for the reduced scope of work. Staff explained to DWR management that planned improvements would benefit both mutuals. DWR management agreed, but it nevertheless requested modifications. DWR indicated that these modifications would be sufficient for it to approve the revised plan.
Garrett said SLVWD is currently connected to Bracken Brae and Forest Springs via an above-grade jumper (a pipe running underneath a bridge) that connects to their 4" PVC pipe. DWR wants a permanent 12” connection buried under the road. Garrett estimated that an additional $150,000 will be needed for this. He said Staff recommends that Consolidation Agreements between SLVWD and Bracken Brae and between SLVWD and Forest Springs be executed as soon as possible, and that the DWR-modified project be pursued with Bracken Brae and SLVWD relying upon a single contractor.
In response to questioning from Director Fultz about how the District could afford the expanded Phase 1 scope, Garrett said he thought the project might still be within budget because the previous $3.9 million estimate allowed for significant overruns. He said the District could still cancel if all the bids come in too high. However, he also suggested that the Consolidation Agreements should include a plan to seek additional funds and a stipulation that the mutuals will otherwise be responsible for expenses. He said the $959,000 earmark for Phase 2 would probably pay for one of the two required tanks, but wouldn’t cover the other tank, the pump, or the connections (estimated to cost about $2.5 million in total).
Director Smolley said it was pointless to discuss this further until the District had numbers form contractors. Director Fultz asked Garrett to return with bid information, diagrams, and numbers. He pointed out that he had been very concerned about DWR’s response to the Phase 1 proposal for a number of months. He agreed about getting Consolidation Agreements in place.
Director Layng expressed concern about people who are running out of water. She asked about the current status of congressional conversations. Garrett said Environmental Planner Carly Blanchard had been working on this prior to her resignation. He said he was working with the remaining Environmental Planning staff member to review the required documentation so that the earmarked money could actually be obtained for the tank. He said they had an application for additional funding from the State’s revolving fund, and the mutuals might be able to obtain some kind of debt financing or perhaps a special assessment. In response to a follow-up question from Director Layng about status of the pump house plan, he said the contractor would work with the manufacturer to provide a design that meets the technical specifications.
Director Largay said this was super exciting as it meant the systems are really close to connecting. However, he still wanted to see further details, and he asked when the Board’s approval would be required. Garrett said the Board will have discretion to execute the contract or cancel the bids when these are received. He also said former District Manager Rick Rogers had been working on Consolidation Agreements, so drafts were already available. Director Largay said he remained concerned about the timeline.
Director Fultz said the District had previously done consolidations contingent upon funding from the community. But he said pressure needed to be applied not to the District but to the relevant politicians.
There were three public comments. Nicole Launder Berridge of Bracken Brae said there was a letter from Bracken Brae thanking the Board and the District. She thought revised Consolidation Agreements could be completed in the next four or five days. Much will depend, though, on the actual bids that are received. She said Bracken Brae was currently seeking more funding.
Bruce Holloway of Boulder Creek asked if the additional work would include the 10" main in Bracken Brae. Garrett said it would only go part way, but they wanted to incorporate Bracken Brae FEMA funding into the Phase 1 project.
Eric Martin of Boulder Creek asked a brief question about the pump house and then yielded his remaining time to Nicole. She said Bracken Brae was building its pipe downward with FEMA money. If the Board allows this, they will consolidate the full system under Phase 1, minus one home. She said the Consolidation Agreement was incredibly important. She needed the ability to work with someone on the Board because Legal Counsel doesn't fully understand Board's desires. She said this couldn’t wait for another Board meeting.
Director Smolley said he would like Garrett to bring the two Consolidation Agreements back to the Engineering Committee with whatever revisions he was proposing. Director Fultz said he supported the idea of a unified project with a single contractor.
Following a brief discussion, President Hill designated Director Smolley to work directly with Garrett and Bracken Brae. All five Board members endorsed this. Director Largay added that he had been approached by Sierra Ryan who said the County very much wants to support this process. He said LAFCO also has significant technical resources and would be happy to lend support.
Board of Directors Meetings
President Hill introduced this agenda item by saying the District currently had a lot on its plate and no Interim GM. He said it had been proposed that the Board return to meeting twice a month (on the first and third Thursdays) for the foreseeable future.
All five Directors agreed that this was a good idea, but the agenda item indicated only that this matter would be discussed and not that the Board would take any action. Also, this technically involved a change to the Board Policy Manual. The Board therefore first had to unanimously approve a motion by Director Fultz to change the agenda based on a Board finding that it was facing an emergency relating to deadlines from FEMA and DWR. The Board then unanimously approved a separate motion by Director Fultz to transition to regularly scheduled Board meetings on the first and third Thursday beginning September 19th.
Director Largay expressed concern about the possibility that a Board member might have preexisting commitments that could prevent them from attending an unanticipated meeting, but the Board informally agreed to defer this concern.
Consent Agenda
There were four items on the Consent Agenda:
a. Annual Disclosure- Employee Reimbursements
b. Monthly Finance Report
c. Alta Via Change Orders
d. Board Minutes from August 23 and August 27, 2024
Director Layng noted a recurring typo in the Board Minutes (d), but Director Smolley begged her not to pull this item for further discussion, and she ultimately agreed. All items on the Consent Agenda were then unanimously approved with no further comment.
Written Communications
Debra Loewen of Lompico called attention to a letter she had written to the Board in which she compared recent revenue from fixed charges to that from volumetric charges.
The meeting was adjourned at 8:20 PM.