MINUTES
OF MEETING
CORAL
SPRINGS
IMPROVEMENT
DISTRICT
The regular meeting of the
Board of Supervisors of the Coral Springs Improvement District was held
Present and constituting a quorum
were:
Bob Fennell President
Sharon Zich Vice President
Glen Hanks Secretary
Also present were:
Dan Daly Interim Manager
Ed Goscicki Co-Manager –
Dennis Lyles Attorney
John McKune Engineer
Jane Early CH2M-Hill
David Green CH2M-Hill
Randy Fredericks Field
Supervisor
Doug Hyche District Staff
Mona Slaughter
FIRST ORDER OF BUSINESS Roll
Call
Mr.
Goscicki called the meeting to order and called the roll.
SECOND
ORDER OF BUSINESS Organizational
Matters
A. Oath
of Office for Newly Elected Supervisors
Ms.
Slaughter being a Notary Public of the State of
Mr.
Fennell stated I know Ms. Zich is interested in resigning. I was hoping some candidates wanted to take
your place but unfortunately this has not occurred. We will look for someone. However, it will help us if you stay until a
replacement is found.
Mr.
Daly stated we can place a notice on the website saying this District is
actively seeking candidates.
Mr.
Fennell stated this Board has a lot to be proud of from the standpoint for the
last six months; we have gone through numerous things with the District. What the Board should be proud of the most is
the hurricane cleanup. I think we have
done a good job. The reason why no one
is here is because this is a strong Board and is respected by the community. Thank you all.
B. Election
of Officers
Mr.
Fennell asked can we change the officer structure at any time?
Mr.
Lyles responded typically the officers are elected after the landowner’s
election.
Mr.
Fennell stated at this time, I am probably better off serving as President.
Mr.
Hanks stated you are better suited for the political aspects.
Mr.
Lyles stated if there were to come a time when Mr. Fennell wished to no longer
serve as President, he can resign from his seat, have a vacant seat and the
remaining Board can discuss filling of vacancy by a member of the Board. Meaning the Board members can elect another
President for the rest of the term.
There is probably an easier way to do this, if Mr. Fennell decides to no
longer serve as President. However, the
Act contemplates having the election immediately after the landowner’s meeting.
Mr. Hanks nominated Mr. Fennell as
President and Ms. Zich seconded the nomination.
There being no further nominations, with all in favor Mr. Fennell was
elected President.
Mr.
Fennell stated the next office we should consider is Secretary as they are
required to sign documents. The Vice
President has the easiest job. Since Ms.
Zich plans to move on, I recommend Mr. Hanks serve as Secretary.
Ms. Zich nominated Mr. Hanks as Secretary
and Mr. Hanks seconded the nomination.
There being no further nominations, with all in favor Mr. Hanks was
elected Secretary.
Mr. Fennell nominated Ms. Zich as Vice
President and Mr. Hanks seconded the nomination. There being no further nominations, with all
in favor Ms. Zich was elected Vice President.
THIRD ORDER OF BUSINESS Approval of the Minutes
of the
Mr. Fennell stated each Board member
received a copy of the minutes of the
Ms. Zich stated on page one, Mr.
Daly is listed as working for Severn Trent Services. Is this correct?
Mr. Daly responded no. I work for CSID.
Mr. Hanks stated on the bottom of
page six, the “
On MOTION by Mr. Hanks seconded by Ms. Zich
with all in favor the minutes of the
Mr. Fennell stated each Board member
received a copy of the minutes of the
There not being any,
On MOTION by Mr. Hanks seconded by Mr. Fennell
with all in favor the minutes of the
FOURTH ORDER OF
BUSINESS Presentation
by CH2M-Hill of the Final Conditions and Assessment Report for Pump Stations 1
& 2
Ms. Early stated at the last
meeting, we distributed the final report.
Since that time, we met with District staff, Mr. McKune and Mr.
Fredericks and went through the itemized list.
We removed the items we do not want to do at this time. This is just a discussion item as far as if
there is money available to move forward with some of these improvements and
repairs to the pump stations. The items
in blue are the ones FPI is providing the labor for. Because they are so late, they agreed to
provide the labor for us. Do you know
what the labor cost savings are?
Mr. McKune responded they have not
given us a breakdown.
Ms. Early stated we just have to
divide the parts. There are 17 per
station. We decided to remove the
mustard colored items after the meeting with District staff. The items in yellow are high priority with the
pump stations needing to be repaired, improved and replaced.
Mr. Hanks asked is the fencing
replacement for the exterior of the trash rack?
Ms. Early responded yes.
Mr. Fennell asked how often do we
need to replace the LP gas tank?
Mr. Hanks responded we should speak
to FPI about extending its life.
$100,000 can go for in terms of extending its life.
Ms. Early stated we decided not to
do it.
Mr. Fennell stated six or seven
years ago, we replaced the pump. I
thought we replaced the LP gas tank at the same time.
Ms. Early stated I could not find
any history.
Mr. Hyche stated I do not recall us
doing so.
Mr. Fennell stated Mr. Roger Moore had
an issue with was who was going to do the replacement. There was a great deal of discussion about
the contractor supplying the gas owning the tank. What determination do you make when you
replace it?
Ms. Early responded one of the
issues was the amount of storage for fuel and how many days we can operate the
pumps without fuel. Currently we can
operate for two to three days but we were trying to increase it to six days, if
we were hit by a hurricane. However,
after we saw the cost, we changed our minds.
Mr. Fennell stated this is an
entirely different question. At the
plant we have enough fuel to last us a week, maybe more. If you are saying we only have enough fuel
for the pumps for two to three days, this is a big issue.
Mr. Hanks stated keep in mind; you
have this emergency flap gate, which Mr. Hyche says needs to be repaired.
Mr. Daly asked what is the capacity?
Ms. Early responded I do not know
how much water it can hold.
Mr. Fennell stated good question.
Ms. Early stated it is not going to
be as much as you pump.
Mr. Fennell stated the way our
models work; we are counting on the rain lasting over two to three days. On the third day, we run out of gas.
Mr. Hanks stated we need to contact
a gas company to see about getting a line to supply the gas.
Mr. Hyche stated the problem with
running a line is we do not have an easement.
Mr. Hanks stated the easement is not
going to be the issue but how we are going to get the gas in there. The question is one of liability and whether
the fuel trucks can get through.
Mr. Fennell asked was there a
rationale for three days?
Ms. Early responded originally we had
this item on the task list but after the last meeting and looking at the
budget, we decided this was a big ticket item.
I do not think they are leaking.
They are operating.
Mr. Hyche stated if you want, we can
test them.
Mr. Fennell stated I think this
should be done immediately. The real
issue is to get an LP truck back there and down the canal in order to get gas
in there. This has to occur on the
second day after a hurricane.
Mr. Hanks stated you have a few days
leeway. How many hours will it run
continually?
Mr. Hyche responded a few days.
Mr. Hanks asked when was the last
time you had those pumps on continual run for two days?
Ms. Early responded never.
Mr. Hanks asked is this with three
or four pumps running continually?
Mr. Hyche responded you are not
allowed to run four pumps continually.
Mr. Fennell stated if you receive a
warning, they will be pumping at least the day before. Make sure we can get a truck in there. After the rain comes, depending on how bad it
is, you will be pumping like crazy.
Mr. Hanks stated every storm within
the last three to four years; we have not received more than six inches. If you run it for two days, by the third day
you are tapering out.
Mr. Fennell stated the lower the
intensity of the hurricane, the more rain you are going to get because it does
not move on. Some have been known to
back up, come back and hit us again.
Mr. Hanks stated keep in mind, all
we are looking at is a 1% chance.
Mr. Fennell stated we saw we could
not get supplies in here for several days and we did not even get hit hard.
Mr. Hanks asked did they come in
with propane?
Mr. Hyche responded propane was not
a problem. Diesel was a problem because
Port Everglades was shut down.
Mr. Fennell stated we need enough fuel
to get us past two or three days and up until a week.
Mr. Hanks stated we do not have
enough money in the budget.
Mr. Fennell stated this is a
different budget.
Mr. Goscicki stated we placed
$580,000 plus some contingency for this project into your upcoming fiscal
year’s budget.
Ms. Zich stated this is a revised
budget because the backup is not correct.
Someone sent me this budget. If
you look at the old budget, the numbers are right.
Mr. Daly stated I apologize.
Mr. Hanks asked are these projects
allocated in the 2007/2008 budget?
Ms. Early responded not all. We took the LP tank out. The bright yellow and blue items are what we
totaled.
Mr. Hanks stated $261,009.75 is in
the proposed budget. The items not
highlighted are what we removed, including the LP gas tank replacement.
Mr. Fennell asked is this an
operating budget as opposed to a capital budget?
Mr. Goscicki responded both. This is the General Fund Budget, including
both your operating and capital expenses.
We tried to wrap all of the financing onto one page to show what dollars
you have left at the end of the day.
This is what Mr. Daly and I were working with on last Friday. We wanted to come up with a better
presentation. The bottom line of what
the Board needs to know and the reason why we placed this pump station
discussion before the budget discussion was because it has a budgetary
impact. We currently allocated $580,000
for this project for next fiscal year.
We recommend you not increase your assessments and keep them level at
$150.71 per unit. At the end of next
year, you will be down to a $217,000 uncommitted fund balance. You are going from a fund balance of $1
million at the beginning of this year, down to $217,000 in uncommitted fund
reserves. You still have another
$264,000 in reserves to cover your first quarter operating expenses. You are spending reserves that have been
here.
Mr. Hanks stated you do not have any
cash on hand for any hurricane cleanup.
Mr. Goscicki stated you are left
with $217,000.
Mr. Hanks stated at the last
meeting, we discussed what you thought was a reasonable reserve. As you recall, we were talking about $1
million.
Mr. Goscicki stated we were talking
in this order of magnitude.
Mr. Hanks asked has anything changed
with regards to discussions with this amount being a target?
Mr. Goscicki responded no. This is a good goal to get to but not
something you expect to have tomorrow.
You have $217,000 and are carrying this cash reserve to bridge your revenue
stream. This revenue comes in as a lump
sum a couple of months into your fiscal year and will be there after the first
couple of months to deal with emergency situations. You are not broke as you have some operating
capital.
Mr. Hanks stated this is fine if we
do not get hit with a hurricane early in the season. We are still five months from getting money
from the Tax Collector. As much as we
are talking about being proactive with the pump stations, we need to be
proactive with our finances and have the funds on hand and available so we can
respond.
Mr. Goscicki stated this is why we
presented the budget in this fashion. We
wanted to keep your assessments at the same level; with you getting a nominal
investment of $200,000 in reserves. You will
be funding this amount every year. The
way we structured this budget, if you get the same operating expense, you can
put in another $200,000 and carry it over.
Mr. Fennell asked how many reserves
do we currently have?
Mr. Goscicki responded at the
beginning of this fiscal year, we are showing $1.2 million. We are estimating at the end of this fiscal
year, you will have $400,000. In the
last two years, you have been dealing with hurricane issues.
Mr. Fennell stated I am looking at
some items as a capital improvement. We
should be paying for it. I do not think
we want to spend down reserves. If we
are going to expend this money, we should be charging for it. What do you think, Ms. Zich?
Ms. Zich responded yes.
Mr. Goscicki stated I will pull out
a calculator before we get to this budget item and figure out some recommended
increases for you.
Mr. Fennell stated we are saying, “If
we are going to be spending $500,000, we should obtain another $10,000 in
revenue”, which ends up being another $40 to $50 per unit.
Mr. Goscicki stated I ended up with
$11,600. The question is whether you
need the money all at once or build it up over seven years.
Mr. Fennell stated the problem is
with the maturation of the plant. We
have done a good job of keeping the pumps going but frankly the physical parts
like the buildings are 30 years old and are dilapidated.
Ms. Early stated ASE put out a
report about the Katrina pump stations, which said their doors were not
hurricane proof. This is why we are
recommending hurricane proof doors. There
is a door but it is not hurricane proof.
Mr. Hanks stated if the doors go,
you lose the integrity of the roof and you get water inside of the building,
causing your motors to break down and losing your pump capacity.
Mr. Goscicki stated we budgeted $600,000
for emergency repairs.
Ms. Early stated the only item not
budgeted for is the LP gas tank.
Mr. Goscicki stated if you increase
your assessments, we have to send a first class notice to every resident
saying, “We are increasing your assessment”, just as the state came in and said
“We are dropping your property tax”.
This is one of the reasons we tried to give you a balanced budget with
no increase in assessments this year.
One of your neighboring districts, Pine Tree WCD is in a tighter
situation than you are. Pine Tree WCD spent
down their reserves due to hurricane remediation and tree removal
replanting. They are taking out a Line
of Credit with SunTrust. It will cost
them a few dollars to maintain but they did not want to have a significant assessment
increase. However, they need to have an
assessment increase just to stay even.
You have a reserve. If we need to
get into an additional reserve, rather than creating cash, we can enter into a
Line of Credit to give us more security.
Mr. Hanks stated we tried a short
term funding for the Enterprise Fund. Is
the Enterprise Fund any different than the General Fund?
Mr. Goscicki responded this is like
a short term loan. In this case, we set
up a Line of Credit and not borrow any money.
If we borrow $5 million, we want to have the ability to access this
money but you would not access it unless you have a hurricane. It is essentially an insurance policy. You are taking it from a bank and will be
paying fees.
Mr. Hanks asked what fees are we
talking about to maintain the relationship with the bank?
Mr. Goscicki responded if I recall,
Pine Tree WCD paid $10,000 to $15,000 to set up the program and for maintenance
costs.
Mr. Fennell stated we can set the
assessment to any amount. What is the
current amount per unit?
Mr. Goscicki responded $150.
Mr. Fennell asked at the next
meeting when we pass this budget, can we set the assessment?
Mr. Goscicki responded the Board can
certainly increase the assessment. If
the Board wants to approve a budget with a requested increase in assessment, we
are required to send a notice to every property owner notifying them of this
increase in assessment and the date when the public hearing is held.
Mr. Lyles stated we used the
property tax roll for our assessments.
Chapter 197 of the Florida Statutes applies to the adoption of a budget
and setting of assessments. One of the
provisions has been construed by the appellate courts to mean if you adopt an
assessment for the first time or increase an existing assessment by any amount,
you are required to notify every landowner/taxpayer within your jurisdictional
limits by first class mail. The letter
will state the amount of the increase, the reason and the date, time and place
of the public hearing. We can have the
budget hearing with just a notice in the newspaper. This is what will occur at the July
meeting. However, if you increase the
assessment, we will have to follow the appellate court decision requiring
individual mailed notices by first class mail.
This is what staff has suggested.
Mr. Fennell stated by doing this we
are saying we spent more money than we budgeted for.
Mr. Goscicki stated you spent more
money this year and last year with hurricane mitigation. Your reserves were used for all the hurricane
mitigation work. Even though you
received significant reimbursement, you spent a great deal of money.
Mr. Hanks asked when are we going to
be back up to the target reserve?
Mr. Goscicki responded at this rate,
it will take three to five years to reach $1 million.
Mr. Fennell stated we had a reserve
of $1 million last year, which helped us.
Some districts did not have enough money in their reserves to do their
mitigation work. Their big concern was
money.
Mr. Goscicki stated some districts
took out a loan for $5 million for the hurricane mitigation work. You are correct; they did not have funds on
hand but were able to get some funds fairly quickly.
Mr. Fennell stated I would not want
to see us spend down our reserves. If we
need more money, we will have to send out notices to the taxpayers saying we
are going to do this. We can also take
out a bank loan.
Mr. Hanks asked can we increase
their assessment after 12 months to pay off $5 million?
Mr. Goscicki responded yes.
Mr. Hanks stated for years, we have
been under the assumption we have not had to worry about cleaning costs. The truth is we are going to have to increase
assessments either before a hurricane hits to be proactive or pay additional
fees to borrow money from a bank and incur assessments after a storm.
Mr. Fennell stated I applaud the
City of
Mr. Hanks asked how much harm will we
do the District if we had to wait a month or two?
Mr. Goscicki responded the option we
are looking at is for you to take out a Line of Credit so you have the funds if
needed next year.
Mr. Fennell stated we have $1
million in reserves. Correct?
Mr. Goscicki responded you started
the year with $1 million but by the end of the year, it will be around
$300,000.
Mr. Fennell stated we need to
balance the budget for the items we need to have. Therefore, we need to increase assessments in
order to do so. We either pay now or
later. I wonder whether we should do
long term financing. Many of these items
are maintenance related.
Ms. Zich stated we had $1 million at
the end of last year and have $400,000 now.
This means we spent $600,000 on extra items due to the hurricane.
Mr. Fennell stated we spent $430,000
for hurricane cleanup.
Mr. Goscicki stated by raising
assessments, you will raise $400,000, which is significant. This goes right into the reserves. Do you need to move on this quickly? You did not build your initial $1 million
overnight. You are currently in a solid
financial position. You are not deficit
spending. You spent your reserves on
appropriate capital reserves items; not for funding operations. Other districts were funding their operations
out of reserves for two years. I do not recommend
doing this. You are funding your current
operations out of your revenue and putting money towards reserves with your
current revenue. I recommend against
doing a 20% increase in assessments at this time in this climate. I want you to think long and hard about
whether or not you want to do this.
Mr. Hanks stated we are talking
about it taking three to five years to bring us back to having $1 million in
reserves at our current assessment.
Mr. Goscicki stated correct.
Mr. Hanks asked if we were to
increase our debt assessments by $10, would we be looking at it taking two to
four years to build up our assessments to $1 million?
Mr. Goscicki responded $10 per unit
will bring $100,000 per year in revenue.
Mr. Fennell stated the fact is, we
have not received any increase in revenue since the last time we raised
assessments. This is a per unit
assessment.
Mr. Goscicki stated correct.
Mr. Fennell stated we kept our rates
where they should be and do not have excess funds.
Mr. Hanks stated this year we can
increase the assessment per unit by $40 and next year decrease it.
Ms. Zich stated I am concerned about
raising assessments.
Mr. Daly asked is there a concern
because you are also raising the water and sewer rates?
Mr. Fennell responded yes.
Ms. Zich stated the residents have
to see we have not raised the rates in 15 years.
Mr. Goscicki stated some of the
arguments you will get from residents is why they are paying for you to amass
$1 million to pay for contingencies they will never get the benefit of.
Mr. Hanks stated you could live here
the rest of your life and never receive any benefit.
Ms. Zich stated everyone here received
the benefit of the $600,000 we used.
Mr. Fennell stated I think we should
put out a notice of increase in assessment and find out what the residents have
to say. Maybe they will come to the
public hearing and say, “No Way!” or maybe they will say “Yes”. When is the public hearing?
Mr. Lyles responded July 16th. In order to put all of this into play, you
have to approve by resolution, the proposed budget with these changes by
resolution. Staff has to prepare a 20
day written notice to the property owners.
Mr. Hanks stated in the minutes,
there was some reference to CDDs versus Special Districts and the noticing
requirements. I recall the minutes
saying we needed 30 days.
Mr. Lyles stated we are looking at
20 days. You are confusing this with a
CDD who has to provide the budget to the county 60 days before the public
hearing. They do not approve it or
disapprove it. It is informational but
there has to be a 60 day gap between approving the proposed budget and setting
the public hearing for adoption of the final budget. In our case, since we are not a Chapter 190
CDD, we have a much shorter time period.
We have to publish the advertisement in the newspaper twice, two weeks
before the public hearing. If you
increase assessments today, by virtue of this amendment to the proposed budget,
there will be a 20 day mailing period in order to meet on July 16th.
Mr. Fennell stated I want to modify
the budget to a point where the funds are coming from the reserve but from
straightforward surplus and increase assessments. The funding is not for the normal operations
but we want to pay for the capital improvements listed on the task list
provided by the engineer. We already had
staff go through this and they pared it down to something more than we wanted. The question is how to pay for the capital
improvements.
Mr. Hanks asked when was the last
time the assessment was changed?
Mr. Fennell responded we changed it
right after the hurricane hit.
Mr. Hanks asked is this the second
increase?
Mr. Fennell responded yes. Once we paid off our bond issues, we lowered
the amount we were charging the residents.
We had cash reserves until Wilma came along. We can put out a bonds issue, but for a
couple of million dollars, this is probably not worth doing. I propose we fund our capital improvement
through an assessment.
Ms. Zich stated I hate to do
this. This is why I am sitting on the
edge of whether or not to do this. We
just increased the water rates.
Mr. Hanks asked did our Fire
Assessment increase?
Mr. Daly responded it was proposed
to increase.
Mr. Hanks stated we are talking
about our assessment increasing from $150 to $190 per unit.
Mr. Fennell stated for the entire
year, which is only an increase of $4 per month or $1 per week.
Mr. Goscicki stated when we get to
the budget discussion; we will add a specific dollar amount to the budget and
set the public hearing.
Mr. Fennell stated staff did a great
job looking at pump stations 1 and 2 and figuring out what we need to do in
order to keep them running. It has
always been the option of the Board to make sure they work well and there are
no problems. We know from our flood
studies, we cannot let them break down.
There is no wiggle room, especially in the eastern part of the District.
Mr. Hanks stated considering some of
those costs we were contemplating.
Mr. Hanks asked is there room on the
site for an additional propane tank?
Instead of doing a total replacement, we can take one out of
service. We have to consider the
excavation cost versus the installation cost.
We will not have any disposal fees.
How much does an additional one cost?
Mr. Hyche responded around
$1,200. I can check on the cost for a
pressure tank. You are required to
replace the fuel system every five years.
Mr. Hanks asked for the above
ground?
Mr. Hyche responded for the below
ground ones.
Mr. Fennell stated we will know more
by the time this comes back to us. Mr.
Hanks has a good idea of adding another tank of the same size next to it. We are looking for a proposal at the next
meeting for the additional tank along with some other ideas.
SIXTH ORDER OF
BUSINESS Staff
Reports
A. Manager
Mr.
Fennell asked what is the status of our bond issue?
Mr.
Goscicki responded we are moving along.
An item we were not able to get onto the agenda was the engagement of
Bond Counsel. We also have a work
authorization for the engineers to complete the Bond Feasibility Study. We are still looking at both short-term and
long-term bond issues. Bond Counsel
along with your Underwriter and Engineer are working diligently with your
current bondholders to restructure our current bond resolutions, allowing for
this new debt structure. I received
emails this week from Prager, Sealy indicating this process is moving along
fairly well. They had some meetings with
the current bondholders and insurance agency.
We need to have the Board approve a Bond Counsel Agreement, which I
received the day after your agenda packages went out. You will see this item at the next meeting as
I need time to review it.
Mr.
Fennell stated we received an amended agenda.
Mr.
Goscicki stated it was probably mailed out to you as a separate item.
Mr.
Lyles stated the concern was you needed time to look at it. However, if you received it as a supplement
to the agenda package, you may act on it now.
It is up to the Board.
Mr.
Fennell asked is time of the essence?
Mr.
Goscicki responded absolutely. They are
working and want to formalize the relationship.
You already authorized and selected Ruden, McClosky as your Bond
Counsel. As we worked through the
initial states, they kept track of their time.
However, they got to the point where they wanted you to formalize their
agreement at a lump sum price. We
reviewed the agreement and feel comfortable with it. It is not an insignificant sum of money; however,
this is a relatively complicated bond issue by having to do an original Bond
Anticipation Note, follow-up bond, dealing with your existing bond resolutions
and existing covenants. The other issue
we need to take up today is authorizing the engineer to complete the
Feasibility Report, which they are currently working on in good faith.
Mr.
Fennell asked what does the attorney think?
Mr.
Lyles responded I reviewed the letter and discussed it with Mr. Goscicki. It is a significant fee but as he explained,
it is a significant undertaking. There
are at least two components; the BAN and pre-bond issue structure. The reason for the two components is in
virtually every bond deal; Bond Counsel receives the larger fee of any
professional involved. Disclosure
Counsel is sometimes called Underwriter’s Counsel. The Underwriter is Prager, Sealy and they
typically have a law firm, prepare the Offering Memorandum, advising the
Underwriter and playing the role. What
is proposed here is having Bond Counsel serve as Disclosure Counsel. They will prepare the documents, file with
the regulatory agencies and provide the continuing obligation to disclose
material changes in the financial structure.
They combined this into one law firm with two components to the
fee. As explained in the letter, their
fee does not get paid unless they have the bond closing. If you change your mind and decide not to go
forward, they will want to be reimbursed for the labor they put forth. They also issue tax opinions to the security
and investors market to get these bonds sold at the lowest possible rate they
can. They are tax exempt. This is a complex undertaking in the broad
scope. I worked with this firm and this
attorney on a number of occasions, including your refunding a couple of years
ago. We know we will get top notch
performance from them.
Mr.
Hanks stated the fee we are paying is $150,000.
Is this fee ordinary?
Mr.
Goscicki responded it is on the high side, based on the complexity of the
current situation as we are going out for new water and sewer bonds. If it was for the existing debt in place,
this would be a significantly lower fee and simpler process.
Mr.
Hanks stated we are looking at a fairly time consuming process.
Mr.
Goscicki stated correct.
Mr.
Lyles stated this fee is in line with several financings done in NSID over the
past 24 months for a similarly complex issue.
In some cases, it involved infrastructure and not a Water Plant.
On MOTION by Mr. Hanks seconded by Ms.
Zich with all in favor the engagement letter with Ruden, McClosky to serve as
Bond Counsel was approved.
FIFTH ORDER OF BUSINESS Current Status and
History of Open Work Authorizations
Mr.
Fennell asked which ones do we need to approve?
Mr.
Goscicki stated this item is not for approval purposes but informational. The Board asked for this item to be placed on
the agenda on a monthly basis. Your engineers
are doing an unbelievable amount of work and this is a nice way for you to see
where they are on each activity and the amount of money spent to date. This is a good tool for your staff and
managers to review with the engineers what they are doing.
Mr.
Hanks asked does this reflect the $156,000 recently voted on for CH2M-Hill?
Mr.
Goscicki responded yes.
Mr.
Fennell asked what about the work authorization you asked me to sign last week
for $32,000?
Ms.
Early responded this was a new work authorization.
SIXTH ORDER OF
BUSINESS Staff
Reports
A. Manager
i. Distribution
of Proposed Budget for Fiscal Year 2008 and Consideration of Resolution 2007-6
Approving the Budget and Setting the Public Hearing
Mr.
Goscicki stated the budget was distributed to the Board. It reflects an assessment of $150 per
unit. The Board has been considering
whether or not to increase this assessment to generate additional revenue in
order to help re-build your reserve funds.
What we need from the Board at this time is a motion approving the
budget for purposes of setting the public hearing. If the Board approves an assessment greater
than $150, we will need to send out individual notices to the affected property
owners. We are planning to hold the
public hearing at your next meeting, based upon action you take today.
Ms.
Zich stated at the last meeting, we said we are going to set aside $75,000 for Vegetative Management. I do not see where this was added. We talked about adding this item under
repairs and maintenance.
Mr.
Goscicki stated you are correct. It will
need to be added.
Ms.
Zich stated add it under repairs and maintenance.
Mr.
Fennell asked what is wrong with making a separate line item?
Ms.
Zich responded the accountant said there were only certain accounts you can
use.
Mr.
Goscicki stated we get into chart of account issues and the charts we can use
for budgeting. However, we can certainly
show this in the backup.
Ms.
Zich stated list it separately like the other items under Repairs and Maintenance on page 12.
Mr.
Goscicki stated the way the budget is developed; we look to see how the numbers
balance out with the dollars available.
We go through a process to try to find something workable.
On MOTION by Mr. Hanks seconded by Ms.
Zich with all in favor the proposed budget was amended to reflect $75,000 will
be added under Repairs and Maintenance for Vegetative Management.
Mr.
Hanks stated I am interested in seeing how we are going to handle this. Just because we have it in the budget does
not mean we have to spend it.
Mr.
Fennell stated the other item we wanted to amend in this proposed budget is not
using the carry forward surplus and increasing the assessment levy so we can
pay for our improvements.
Mr.
Goscicki stated you currently have $600,000 in your budget for next year, which
can be allocated for the pump station 1 and 2 improvements. This money is on hand, which we can use if we
get hit by a hurricane next week.
Mr.
Fennell asked what number do we want to increase the assessment to?
Mr.
Goscicki responded I am looking for an assessment level this Board is willing or
“desire” to move to. We are talking
about building a reserve. The question
is what assessment level you are comfortable moving to. We will re-work the budget using this number. This is the number we need to know in order
to send out the public notice in the next 10 days. The current assessment is $150.71. Every $10 is going to generate $110,000 of
additional revenue for the Board.
Mr.
Hanks asked do we currently have a projected fund balance of $430,000?
Mr.
Goscicki responded this is what we project to have at the end of this
year. With your current assessment,
assuming you went forward with an improvement program, you will have an
uncommitted fund balance at the end of next fiscal year of $217,500, which is
the last line under Field Operations for Reserves for R&R and Emergency.
Mr.
Fennell stated I propose we increase the budget by $37.00 per unit to $187.70.
Mr.
Goscicki stated this should put your revenue at $600,000 by the end of next
fiscal year.
Mr.
Fennell stated this balances us out to where we do not spend any carry forward
surplus.
Mr.
Goscicki stated you are only spending half of the carry forward surplus. You are starting out with $430,000 and ending
the fiscal year with $217,000.
Mr.
Fennell stated we could take anything out of reserves and try to balance it out
and not have an excess. What are our exact
reserves?
Mr.
Goscicki responded I cannot tell you as we do not know.
Mr.
Hanks stated keep in mind; we have capital projects out there, which we agreed
should be done. They have not been
approved and we have those funds available.
Mr.
Fennell asked do we?
Mr.
Goscicki responded yes. We budgeted
$580,000 for these pump station improvements.
Mr.
Fennell asked do we have any projects for next fiscal year?
Mr.
Goscicki responded no.
Mr.
Fennell stated we received a task list from the engineers for longer term
projects such as an interconnect and digging canal connections.
Mr.
Hanks stated you are not looking at anything being handled by the
assessments. You are also not talking
about something under $1 million. It is
going to cost $10 million or more.
Therefore, you want to think long and hard about whether we are going
forward with these assessments.
Mr.
Goscicki stated Mr. Daly pulled up your assessment history over the last three
years. In 2004-2005, the assessments
were $82. In 2005-2006, the assessments
were $91.38 and in 2006-2007, we increased them to $150.
Mr.
Fennell stated because of the hurricane.
Mr.
Hanks asked where has this money been going and why were we not paid back in
the reserves?