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HomeMy WebLinkAboutCFPUA 7 9 2014 Regular Meeting CAPE FEAR PUBLIC UTILITY AUTHORITY AUTHORITY BOARD MINUTES JULY 9, 2014 Lucie Harrell Conference Room Regular Meeting 9:00 AM 230 GOVERNMENT CENTER DRIVE WILMINGTON, NC 28403 I. CALL TO ORDER II. DETERMINATION OF A QUORUM Mr. Quinn called the meeting to order and declared a quorum pres attendance. Attendee Name Organization Title Status Arrived Jim Quinn Cape Fear Public Utility Vice-Chair Present Authority Patricia Kusek Cape Fear Public Utility Chair Present Authority James Brumit Cape Fear Public Utility Secretary Present Authority Mike Brown Cape Fear Public Utility Treasurer Present Authority Cindee Wolf Cape Fear Public Utility Present Authority William Norris Cape Fear Public Utility Present Authority Larry Sneeden Cape Fear Public Utility Present Authority Kevin O'Grady Cape Fear Public Utility Present Authority Charlie Rivenbark Cape Fear Public Utility Present Authority Woody White Cape Fear Public Utility Present Authority Thomas Wolfe Cape Fear Public Utility Present Authority Jim Flechtner Cape Fear Public Utility Executive Director Present Authority Linda Miles Cape Fear Public Utility Attorney Present Authority Karen Durso Cape Fear Public Utility Assistant to the Executive Present Authority Director Donna Pope Cape Fear Public Utility Clerk/Executive Secretary to the Present Authority Board John Payne Cape Fear Public Utility Internal Auditor Present Authority Frank Styers Cape Fear Public Utility Chief Operations Officer Present Authority Cape Fear Public Utility Authority Page 1 Minutes Authority Board July 9, 2014 Cheryl Spivey Cape Fear Public Utility Chief Financial Officer Present Authority Carel Cape Fear Public Utility Director of Engineering Present Vandermeyden Authority Tom Morgan Cape Fear Public Utility HR Director Present Authority Mike Richardson Cape Fear Public Utility Water Resources Manager Present Authority Mike McGill Cape Fear Public Utility Chief Communications Officer Present Authority Kristine Irick Cape Fear Public Utility Customer Service Director Present Authority Julia Vosnock Cape Fear Public Utility Procurpment Manager Present Authority Pam Ellis Cape Fear Public Utility Env & Services Superintendent Present Authority Kent Harrell Cape Fear Public Utility Engineering Manager Present Authority Shane Ford Cape Fear Public Utility Present Authority Heidi Cox Public Water Supply Present Nathan Sanders Present Jim Iannucci New Hanover County Present Cameron Moore Business Alliance for a Sound Present Economy Jonathan Spiers Port City Daily Present Tyler Newman Business Alliance for a Sound Present Economy Ted Cole Davenport & Company Present Mitch Brigulio Davenport & Company Present Ryal Tayloe Ward & Smith Present III. ADOPTION OF AGENDA Mr. Rivenbark moved to adopt the day's Agenda. Ms. Kusek second Agenda was unanimously adopted. IV. BOARD NOMINATIONS / VOTE Mr. Quinn reported as Chair of the Nominations Committee. Messr Rivenbark are the other two Committee members, representing County and City. the following slate of Officers for FY2015: Pat Kusek, Chair Jim Quinn, Vice-Chair Jim Brumit, Secretary Mike Brown, Treasurer Mr. Norris moved to elect the Officers as recommended by the Nominating Committee. Mr. Rivenbark seconded the motion, and it passed unanimously. Cape Fear Public Utility Authority Page 2 Minutes Authority Board July 9, 2014 The Board and staff thanked Mr. Quinn for his service as Chairma Chairwoman. V. APPROVAL OF MINUTES Mr. Brumit moved to approve the minutes of the June 11, 2014, Regular seconded the motion, and it passed unanimously. 1. Authority Board - Regular Meeting - Jun 11, 2014 9:00 AM RESULT: ACCEPTED [UNANIMOUS] MOVER: James Brumit, Secretary SECONDER: Thomas Wolfe AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe VI. PRESENTATION 1. GPS Audit Presentation by John Payne, Internal Auditor Mr. Payne presented an overview of the audit of data from the GP installed in 138 Authority vehicles in December 2013. The Authority policy was prepared with staff input and was approved on March 28. Mr. data from January through March against data from March through GPS units capture speed every minute, and there are different levels taken based upon speed and frequency of occurrence. From Januar there were 3,515 notations of speed that was five miles or more speed limit. After March, there 162 incidents, and only two incide weeks. Idling of engines has also decreased. The Authority wi 123,625 vehicular miles annually. Vehicles are replaced at 120,ge savings roughly equal one vehicle replacement. The estimated ga $30,723 annually. Mr. Payne suggested comparing data from Janua 2014 to July through December 2014 for further analysis. Mr. Flechtner reported that awareness of safe driving habits promotes efficiency as well as safety. Board members were pleased with the report. VII. PUBLIC COMMENTS Cameron Moore, CEO of the Business Alliance for a Sound Economy Association, spoke regarding the proposed ordinance revisions addressing capacity allocation. He stated that the revision was a great tool and he appreciated Committee's willingness to develop such tools. Mr. Moore expr development community that there was a gap for mid-sized developments where there are between 56 and 112 homes in a development cycle. He encouraged address the ordinance to accommodate different sizes of projects Cape Fear Public Utility Authority Page 3 Minutes Authority Board July 9, 2014 Valura Ellison expressed concern regarding the billing at her property on Rogersville Road. Her home was connected and began service in October 2013, with her f compared to approximately $18 a month for property she owns near experienced difficulties with staff locating the meter on her property and installing a meter. She had received a mandatory connection letter with the and thanked an Engineering staff member for helping her get the stated that she had contacted the N.C. Utilities Commission and the Atto suggested a senior citizen's discount. Ms. Kusek asked Ms. Ell review her account. Daniel DeVane spoke regarding several properties his family owns that he manages. He stated that one uninhabitable property is the subject of a City code en concerned about being billed the base rate for an uninhabitable with landlord-tenant billing, stating that tenants may not pay their bills and that the landlord should not be responsible. He expressed concerns with City stor reported that staff would meet with Mr. DeVane and review the ac VIII. JUNE 11, 2014 SPEAKER UPDATE Mr. Flechtner provided an update on the public speaker from June resolved Mr. Cashman's problem. Staff analysis of billing indi approximately 40 percent if the base rate were eliminated. Mr. Brown suggested that staff research the possibility of utili Mr. Rivenbark commented that there was a common thread in public- tenant concerns and base rates for empty properties. He supported Mr. Brown's suggestion to research what other utilities did regarding such properties but would not be eliminated as it paid for debt service. Mr. Flechtner responded that staff would research the concept anem to the Finance Committee. IX. CONSENT AGENDA Mr. O'Grady requested that Item 2 be removed from the Consent Ag Brown moved to approve the Consent Agenda Items 1 and 3 through seconded the motion, and it passed unanimously. 1. Strategic Plan RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe 2. Deposit Ordinance Cape Fear Public Utility Authority Page 4 Minutes Authority Board July 9, 2014 Mr. O'Grady stated that he had no objection to the deposit ordinance revision but asked staff how it would be brought to the public's attention. Ms. Ir on the deposit billing has been completed. Staff has crafted a before the deposits are billed. Each affected account will be reviewed prior to t being mailed, and the letters will be mailed 30 days in advance notification and billing will occur between August and October o has briefed media representatives on the ordinance and policy revisions and press release. Mr. O'Grady moved to approve the deposit ordinance revision. Ms motion, and it passed unanimously. RESULT: APPROVED [UNANIMOUS] MOVER: Kevin O'Grady SECONDER: Cindee Wolf AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe 3. Two New Replacement Generators RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Rivenbark, White, Wolfe 4. Authorization for the Executive Director to Execute a $201,310.2 East Coast Contracting, Inc. for the Kerr Avenue Greater Loop Co RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe 5. McCumbers Ditch Sewer Rehabilitation Amendment 1 to Interlocal A of Wilmington RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe 6. Authorization for the Executive Director to Execute a $179,100 Dntract with Criser Troutman Tanner Consulting Engineers for Miscellaneous Pu Cape Fear Public Utility Authority Page 5 Minutes Authority Board July 9, 2014 RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Rivrk, White, Wolfe 7. Authorization for the Executive Director to Execute a $324,192.8 with Atlantic Construction & Development for Dawson St. Intercep RESULT: APPROVED [UNANIMOUS] MOVER: Mike Brown, Treasurer SECONDER: Charlie Rivenbark AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Riv Wolfe X. NEW BUSINESS A. Administrative Report i. Attorney Report Ms. Miles had no report for open session and requested a closed the meeting to discuss the Tommy Davis, Pointe South, and CB Windswe ii. Executive Director Report Mr. Flechtner referred the Board to the Environmental and Safety packet. 1. Environmental Report 2. Safety Performance Report Mr. Brumit asked for clarification regarding the accidents liste report. Mr. Morgan reported that three vehicular accidents were drivers who struck Authority vehicles, the personal injury was t of the affected vehicles, and there was one safe light violation. iii. Operations Report 1. Market Street SSO Update by Frank Styers, Chief Operations Offic Mr. Styers reported on the June 27 sanitary sewer overflow in th Market Street. An eight-inch diameter pvc force main in the Country Haven area developed a crack. The SSO was discovered at 6:30 p.m., and sta to the new Country Haven force main and repaired the damaged lin repair was completed at 2:30 a.m. on the 28th. Repairs were complicated due to a fiberoptic communications line located very close to the force careful excavation. Mr. Styers reported that staff was knowled Cape Fear Public Utility Authority Page 6 Minutes Authority Board July 9, 2014 and very professional in addressing the line break. Mr. Styers d clarification questions from Board members regarding the locatio the possible causes, and the benefits of redundancies in the sys Mr. Styers reported on operations during Hurricane Arthur on Jul treatment plants switched to generator power early on the 3rd. Two lightning strikes affected Authority equipment, and staff responded quickl Mr. Styers praised Operations staff for their preparedness and r Authority holds regular training exercises and updates its emergency planning. 2. Water Quality Report and Update Mr. Richardson presented the 2013 Water Quality Report. The re on the Authority website, with hard copies available throughout The report combines data for all four water systems, the Sweeney surface water plant, the Nano-filtration groundwater plant, and the Monterey Heights and Flemington groundwater systems. There was one violation for a s organic compound during 2013. There were no questions from Board members regarding the Water Quality Report. iv. Communications Report Mr. McGill distributed bill inserts for the coming year. The in elements and complement last year's brochures. The inserts reinf and direct customers to the Authority website for additional informa-monthly bill will contain a unique message. The cost for the printed in Mr. McGill reported that he is reviewing the website with Ms. Irff. Staff will analyze the website traffic and recommend design changes to user-friendly. He praised I.T. staff for their work on the website s Mr. McGill continues to develop consistent messaging for custome contacts, including rate information and comparison data to other u on projects and successes, and public information meetings in co capital projects. A Heritage Park mandatory connection meeting week of July 14. The Authority received good press coverage on t donation to the CFPUA Assists program and on its efforts to keep of the sewer system. The Board Community Relations Committee will meet soon to discusssaging initiatives. Ms. Kusek called a recess at 10:05 a.m. The Board reconvened at continued with Committee reports. Cape Fear Public Utility Authority Page 7 Minutes Authority Board July 9, 2014 B. Committee Report i. Executive Committee Mr. Quinn reported that the Committee met on July 2 and that Coms were impressed by the results of Mr. Payne's GPS audit. 1. Executive Committee ii. Long Range Planning Committee Mr. Sneeden and Mr. Vandermeyden reported that the Committee met and County representatives attended the meeting provided updates of their comprehensive planning processes. The final plans are on track Mr. Sneeden reported that the Long Range Planning Committee woul incorporate the City and County plans into Authority long range The Committee reviewed and recommended the Authority's revised S which was approved on the Consent Agenda. The Committee receiv regarding digester gas and agreed with staff's recommendation to request for proposals for digester gas usage. The Committee reviewed and discussed staff's recommendations for Capacity Allocation Ordinance and endorsed a request for a devel Scotts Hill Village, contingent upon the Ordinance revision's apval. 1. Long Range Planning Committee - Regular - Jun 26, 2014 3:00 PM RESULT: NO ACTION REQUIRED 2. Revisions to the Capacity Allocation Ordinance Mr. Vandermeyden reported that the City and County had provided comments to the proposed Ordinance revisions and answered clarification questions from Board members. Mr. Brown expressed concerns wit Ordinance but stated that he did not wish to delay the agreement Village. Mr. Wolfe moved to approve the Capacity Allocation revisions to the Authority Ordinance, with the understanding that staff will continue to re the ordinance. Mr. Brown seconded the motion, and it passed una Cape Fear Public Utility Authority Page 8 Minutes Authority Board July 9, 2014 RESULT: APPROVED [UNANIMOUS] MOVER: Thomas Wolfe SECONDER: Mike Brown, Treasurer AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Rivenbark, White, Wolfe 3. Authorization for the Executive Director to Enter into an Agreem Developers of Scotts Hill Village Mr. Wolfe moved to authorize the agreement with the developers of Scotts Hill Village. Ms. Wolf seconded the motion, and it passed unanimousl RESULT: APPROVED [UNANIMOUS] MOVER: Thomas Wolfe SECONDER: Cindee Wolf AYES: Quinn, Kusek, Brumit, Brown, Wolf, Norris, Sneeden, O'Grady, Rivenbark, White, Wolfe iii. Finance Committee Mr. Brown and Ms. Spivey reported that the Committee met on July recommended several items that were approved on the Consent Agen Ms. Spivey reported that the Authority will sell new bonds and a-funding of bonds the City issued in 2005. Ms. Spivey and the Authority's financial that the two bond types be sold at the same time. One sale wou members of the bond team. Another item discussed by the Finance Committee was whether to issue bonds through a negotiated sale with an underwriter or as a competitive sale. Mr. Cole of Davenport & Company, the Authority's financial advis address the Board to explain the types of sales and the advantags of each. 1. Finance Committee - Regular Meeting - Jul 2, 2014 9:00 AM RESULT: NO ACTION REQUIRED 2. Bond Counsel Selection Ms. Spivey reported that she and Messrs. Flechtner and Brumit in three law firms to represent the Authority as bond counsel for the FY2015 Bond sale. All three were extremely qualified, and it was the interv decisions to remain with the Parker, Poe law firm. The firm has Authority in all of its bond sales since 2008, and its attorneyseat deal of institutional knowledge regarding the Authority. The item wa purposes, as the contract was within Mr. Flechtner's signature a Cape Fear Public Utility Authority Page 9 Minutes Authority Board July 9, 2014 White suggested that staff ask the firm to match the price of th proposal, which was $5,000 less. 3. Bond Sale Planning Update Mr. Cole thanked the Board for requesting a presentation from Da Company. The Authority has a "new money" need of $23 million i having the opportunity to refinance the 2005 Water and Sewer Revenue Bonds from the City. Davenport recommends combining the two sales. - funding bonds will be structured with a matched maturity and lev savings and will have both tax-exempt and taxable component, based on IRS determinations. The new money bonds will be tax exempt and structured wi 25-year level debt service amortization. Mr. Cole explained the distinctions between a negotiated bond sa competitive sale. In a negotiated offering, an underwriter and ting team will be selected by the Authority at the beginning of the p underwriting team will work with the Authority, Davenport, and t Government Commission to market the bonds to investors. Pricing will occur over several days with pre-pricing discussions, pricing discovery with investors, and a pricing period and call where the team will pro pricing to the Authority for consideration. The negotiated sale risk for the Authority. In a competitive bond offering, the Authority and its advisors would prepare Bond offering documents, and the Local Government Commission wou them to the highest bidder on a set date. The competitive sale interest rates, resulting in less debt service paid by the Authority over the life of the bonds. The Authority could begin the process with a compe change to a negotiated sale at a future date if desirable. Cha negotiated sale to a competitive sale would present challenges. Eighty percent of bonds are sold through negotiated sales in the and negotiated sales are the method traditionally used in North - general bonds such as the Authority's revenue bonds. Some compe have been done in North Carolina, notably by public universities reported that the Authority's strong bond rating and established support the issuance of bonds using either method. Due to the c the sale combining new money and refunding, Davenport recommended a negotiated sale for the FY2015 Bonds. Mr. Cole reported that th sale would offer more flexibility for the combined sale. Mr. Cole answered clarification questions from the Board regardied and competitive bond sales and explained how each type of sale c structured to the Authority's best advantage, allowing the Autho much control as possible during the process. Cape Fear Public Utility Authority Page 10 Minutes Authority Board July 9, 2014 Mr. Rivenbark moved to offer the FY2015 Revenue Bonds through a negotiated sale. Mr. O'Grady seconded the motion. After a brief discussion, Mr. Quinn offered a substitute motion competitive sale for the FY2015 Revenue Bonds. Mr. Brown second motion. Mr. O'Grady spoke in favor of the negotiated sale and suggested that the Authority wait to consider a competitive sale when it would be i money bonds only. Ms. Kusek asked for a vote on the substitute motion. Messrs. Qu Wolfe, White, and Brumit voted in favor of the substitute motion authorizing a competitive bond sale. Ms. Kusek, Ms. Wolfe, and Messrs. Rivenb O'Grady, and Norris were opposed. The substitute motion failed, Ms. Kusek called for a vote on the original motion authorizing aegotiated bond sale. Ms. Kusek, Ms. Wolfe, and Messrs. Rivenbark, Sneeden, O' Quinn, Brown, and Wolfe voted in favor of the motion. Mr. Brumi Motion carried, ten to one. Ms. Spivey thanked the Board and reported that the selection of the bond team would continue. Staff is preparing a request for proposals from and Ms. Spivey invited Board members to participate in the selec underwriter. 4. July 2014 Monthly Finance Report Ms. Spivey referred the Board to the June financial reports in the Agenda packet. There were no questions regarding the financial data. XI. OLD BUSINESS There was no old business. XII. AUTHORITY Q&A / CLOSING COMMENTS There were no further questions or comments from Authority members. XIII. CLOSED SESSION Mr. Brown moved to enter into Closed Session to discuss the Tomm CB Windswept lawsuits against the Authority. Mr. Rivenbark seco passed unanimously. The Authority entered closed session at 11:35 a.m., received a report from Ms. Miles and Mr. Tayloe, and provided direction to legal c By consensus, the Authority returned to open session at 12:19 p. Cape Fear Public Utility Authority Page 11 Minutes Authority Board July 9, 2014 XIV. ADJOURNMENT Mr. Rivenbark moved to adjourn. Mr. Wolfe seconded the motion, and it passed unanimously. The meeting adjourned at 12:20 p.m. The next regular meeting of the Cape Fear Public Utility Authori 13, 2014. The meeting will be held in the Lucie Harrell Confere Administration building, 230 Government Center Drive, Wilmington commence at 9:00 a.m. Respectfully submitted, Donna S. Pope Clerk to the Board Cape Fear Public Utility Authority Page 12