CFPUA 1 8 2014
CAPE FEAR PUBLIC UTILITY AUTHORITY
JANUARY 8, 2014
REGULAR MEETING
Authority Members Present:
Pat Kusek, Vice-Chair
Jim Brumit, Secretary
Mike Brown, Treasurer
Cindee Wolf
Bill Norris
Larry Sneeden
Charlie Rivenbark, Councilman
Woody White, Commissioner
Tom Wolfe, Commissioner
Authority Member Absent:
Jim Quinn, Chair
Staff Present:
Jim Flechtner, Executive Director
Mike Richardson, Interim Chief Operating Officer/Water Resources Manager
Cheryl Spivey, Chief Financial Officer
John Payne, Internal Auditor
Karen Durso, Assistant to the Executive Director
Beth Eckert, Environmental Services Director
Mike McGill, Chief Communications Officer
Frank Styers, Engineering Director
Tom Morgan, Human Resources Director
Ken Vogt, Wastewater Treatment Superintendent
Loria Potter, Interim Customer Services Director
Jim Craig, Utility Services Superintendent
Julia Vosnock, Procurement Manager
Kent Harrell, Engineering Manager
Craig Wilson, Senior Project Manager
Donna S. Pope, Clerk to the Board
Attorney Present:
Linda A. Miles, the Miles Firm, PLLC
Guests Present:
Tony Boahn, McKim & Creed
Tyler Newman, Business Alliance for a Sound Economy
Media representatives
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The Cape Fear Public Utility Authority held its regular monthly meeting on Wednesday, January
8, 2014, in the Lucie Harrell Conference Room, 230 Government Center Drive, Wilmington,
North Carolina.
Call to Order, Determination of a Quorum, and Opening Comments:
Ms. Kusek called the meeting to order, welcomed all attendees, and declared a quorum present.
Adoption of the Agenda:
unanimously.
Ms. Durso
Approval of Minutes:
Mr. Brumit moved to approve the Minutes of the December 10, 2013, Special Meeting, and the
Minutes of the December 11, 2013, Regular Meeting. Mr. White seconded the motion, and both
sets of Minutes were approved unanimously.
Presentations:
2013 Water Environment Federation Arthur Sidney Bidell Award, Ken Vogt, Wastewater
Treatment Superintendent, Recipient. Mr. Richardson presented the award to Mr. Vogt. The
Bidell Award was established in 1948, and recipients are selected based on leadership, service,
and participation. Mr. Vogt is a Professional Engineer in three states, holds several operating
licenses, and has served as Wastewater Superintendent since 1997. He has served in many
leadership roles in the North Carolina Water Environmental Association.
Service Recognition for Councilman Neil Anderson. Ms. Kusek read a Resolution thanking Mr.
Anderson for his service as an Authority member since February 2012 and his work as a member
of the Human Resources Committee during its search for an Executive Director. Mr. Anderson
thanked the Board and staff and stated that he left the Authority with a high level of trust and
confidence in the organization.
Public Comments:
There were no public comments.
Consent Agenda:
The Board reviewed the Consent Agenda, as follows:
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1. Revisions to Appendix C., Section 1(c) of the Authority Ordinance regarding developer
cost sharing.
2. Lease with New Cingular Wireless PCS, LLC (AT&T) for nine antennae to be placed at
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the 17 Street water tower. The lease has a 15-year term, with monthly revenues of
$2,500 and an annual three percent increase beginning in the second year.
3. Interlocal Agreement with the City of Wilmington and the Authority for the sharing of
fiberoptic material. The Interlocal Agreement has no budget impact.
4. Authorization to advertise and sell items on GovDeals, with donation to local non-profits
if unsold. Revenues will go into the General Operating Fund.
5. Contract amendment with Cavanaugh & Associates, P.A., for construction
administration and observation for the Comprehensive Meter Replacement Program, at a
budget impact of $111,650.
6. Contract with Vanguard Utility Services, Inc., for Phase 1, Comprehensive Meter
Replacement Program, at a budget impact of $2,032,658.10.
7. Change order with State Utility Contractors, Inc., for additional construction activities
on the Nano-to-Market waterline project, at a budget impact of $140,058.58.
8. Contract Amendment with Black & Veatch International for preliminary engineering,
detailed design, permitting, and bidding for the Sweeney Water Treatment Plant finished
water reservoirs rehabilitation project, at a budget impact of $357,300.
9. Change order with East Coast Contracting for additional construction activities on the
Kerr Avenue Greater Loop, Contract Number 1, at a budget impact of $89,056.98.
Mr. Brown moved to approve the Consent Agenda. Mr. Norris seconded the motion, and the
Consent Agenda in its entirety was approved unanimously. Ms. Vosnock and Messrs. Craig and
Ellison left the meeting after the Consent Agenda approval.
New Business, Administrative Reports:
Ms. Miles had no report for open session and requested a brief closed session
at the end of the meeting to discuss a potential claim.
Mr. Flechtner directed the Board to the Environmental and Safety
Reports in the Agenda. There were no questions.
New Business, Committee Reports:
Executive Committee. The Committee met on January 2 and approved the Agenda for the
Board meeting.
Long Range Planning Committee. The committee met on December 19 and reviewed several
items, including the cost-sharing Ordinance revision that was approved as Item 1 of the Consent
Agenda. Staff distributed revisions to Section 1.13 of the General Provisions of the Authority
Ordinance for Board review. Mr. Styers explained the purpose of the revisions, which would
allow owners of structures greater than 500 feet from an Authority line to remain on a private
well or septic system as long as the private system functioned properly and no additional
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plumbing or subdivision of the property occurred. Mr. Styers explained that staff recommended
the 500-foot exemption because of the costs of running a long line and/or a private pump station.
Ms. Wolf moved to approve the recommended Revision to Section 1.13 of the General
Provisions of the Ordinance. Mr. Brown seconded the motion, and it passed unanimously.
Mr. Styers reported that the Long Range Planning Committee revised the FY2015 Capital
Improvement Plan, with a budget of $10,836,000. The plan includes growth and non-growth
projects. The full Board will attend a CIP workshop at 9:00 a.m. on Wednesday, January 29,
2014, in the Authority offices.
Finance Committee. The Committee did not hold a January meeting. Staff distributed the
December financial reports to the Board, and Ms. Spivey was available to answer questions. The
Finance Committee had two items for Board consideration.
Ms. Potter presented Uncollectible Accounts to be written off in the amount of $281,884.91.
Ms. Potter and Ms. Spivey answered questions regarding delinquencies and the debt set off
program of the N.C. Department of Revenue. Ms. Miles answered questions regarding the time
frame for collections. Board members requested that Ms. Miles research the possibility of
requiring a personal guarantee on new business accounts for limited liability companies.
Mr. White moved to approve the Uncollectible Account Writeoff in the amount of $281,884.91.
Mr. Brown seconded the motion.
Mr. Sneeden asked Finance staff for comparison data on delinquencies within the industry.
Ms. Kusek called for a vote, and the motion passed unanimously.
Ms. Spivey reported that water consumption trends continue to reflect decreased usage. Early in
the fiscal year, staff reduced departmental expenses by four percent and moved the money into
reserves. Staff recommended a formal budget reduction ordinance in the amount of $1.2 million,
recognizing a $900,000 reduction in water revenues and a $300,000 reduction in wastewater
revenues, to be offset by the Budget Reserve reduction of $1,200,000.
Board members discussed the national trend of decreased water consumption and the increased
rainfall that occurred in service area during the past summer. Mr. Sneeden stated
that, while there was no drought in the past year, rainfall was still below average. He suggested
that it might be false optimism to forecast rates based on irrigation increases. Mr. Spivey
reported that staff had been analyzing usage data for calendar year 2013, and the data indicated
little peaking of usage during the spring and summer growing season.
Mr. Norris moved to adopt the Budget Amendment reducing the Authority operating budget in
the amount of $1,200,000, showing a reduction of water revenues of $900,000 and reduction of
wastewater revenues of $300,000, to be offset by a reduction in the Budget Reserve of
$1,200,000. Mr. Sneeden seconded the motion, and it passed unanimously.
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Old Business:
There was no old business.
Questions and Answers and Closing Comments:
Mr. White commended staff for assisting a local restaurant owner with inspections and permits
after regular business hours on a Friday before Christmas so that the restaurant could open for
business and serve customers on a weekend.
Closed Session:
Mr. Rivenbark moved to enter closed session to discuss a potential legal claim. Mr. Brown
seconded the motion, and it passed unanimously. The Authority entered closed session at 9:45
a.m., with Ms. Miles, Ms. Pope, and Messrs. Flechtner and McGill present. The Board received
a report from Ms. Miles.
Return to Open Session and Adjournment:
Mr. Rivenbark moved to return to open session. Mr. Brown seconded the motion, and it passed
unanimously. The Authority returned to open session at 9:50 a.m.
Mr. Brumit reported on a School of Government finance course that he had planned to attend on
February 11 and 12. He will not be able to attend and encouraged another Board member to
consider doing so.
Mr. Rivenbark moved to adjourn. Mr. Brumit seconded the motion, and it passed unanimously.
The Authority adjourned at 9:51 a.m.
The Authority will conduct a Capital Improvements Plan workshop in the Authority offices on
Wednesday, January 29, 2014, commencing at 9:00 a.m. The next Regular Meeting of the
Authority will be Wednesday, February 12, 2014. The Regular Meeting will be held in the
Harrell Conference Room, New Hanover County Administration Building, 230 Government
Center Drive, and will begin at 9:00 a.m.
Respectfully submitted,
Donna S. Pope
Clerk to the Board
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