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HomeMy WebLinkAbout2019-04-10 Regular Meeting Minutes CAPE FEAR PUBLIC UTILITY AUTHORITY AUTHORITY BOARD MINUTES APRIL 10, 2019 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 Attendee Name Organization Title Status Arrived William Norris Cape Fear Public Utility Chair Present Authority Wesley Corder Cape Fear Public Utility Vice-Chair Present Authority Jennifer Adams Cape Fear Public Utility Secretary Present Authority Mike Brown Cape Fear Public Utility Treasurer Present Authority Jessica Cannon Cape Fear Public Utility Present Authority Larry Sneeden Cape Fear Public Utility Present Authority Deans Hackney Cape Fear Public Utility Present Authority Patricia Kusek Cape Fear Public Utility Present Authority Charlie Rivenbark Cape Fear Public Utility Present Authority Kevin O'Grady Cape Fear Public Utility Present Authority Rob Zapple Cape Fear Public Utility Present Authority Jim Flechtner Cape Fear Public Utility Executive Director Present Authority Frank Styers Cape Fear Public Utility Chief Operations Officer Present Authority John McLean Cape Fear Public Utility Chief Financial Officer Present Authority Denise Matroni Cape Fear Public Utility HR Director Present Authority Lindsey Hallock Cape Fear Public Utility Director of Public and Present Authority Environmental Policy Kristine Irick Cape Fear Public Utility Customer Service Director Present Authority Beth Eckert Cape Fear Public Utility Director of EMD Present Authority Cape Fear Public Utility Authority Page 1 MinutesAuthority BoardApril 10, 2019 Carel Cape Fear Public Utility Director of Engineering Present Vandermeyden Authority Vaughn Hagerty Cape Fear Public Utility Public Information Officer Present Authority Dave Cowell City of Wilmington Present Heidi Cox State of North Carolina Present Beth Markosino Present III. ADOPTION OF AGENDA Ms. Kusek moved to adopt the day's agenda. Mr. Zapple seconded the motion, and it passed unanimously. IV. APPROVAL OF MINUTES 1. Authority Board - Regular Meeting - Mar 13, 2019 9:00 AM RESULT: ACCEPTED \[UNANIMOUS\] MOVER: Larry Sneeden SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple V. PUBLIC HEARING 1. Adoption of System Development Charges for FY 2019-2020 Mr. McLean presented the recommended system development charges for FY2020. The water SDC is $1,880, which is $50 greater than the current SDC. The sewer SDC is $1,930, which is $130 greater than the current SDC. Mr. McLean reviewed the methodology and the historical data used for the SDC calculation. CFPUA follows the statutorily-required method for setting SDCs, which includes publication on the website for at least 45 days and a public hearing. Mr. McLean reported that the equivalent residential unit numbers are trending higher than forecast for this year, and the SDC could be set at $1,840 or water and $1,890 for sewer if using current figures. Mr. Zapple requested that staff keep an eye on the figures for calculating SDCs. Mr. Norris opened the public hearing. There were no speakers, and Mr. Rivenbark moved to close the hearing. Mr. O'Grady seconded the motion, and it passed unanimously. Mr. Rivenbark complimented staff on the presentation, stating that the City and County had struggled in the past with their investments into infrastructure. O'Grady asked for clarification on the use of grant funding in the depreciation calculation used for SDCs. Cape Fear Public Utility Authority Page 2 MinutesAuthority BoardApril 10, 2019 Ms. Kusek moved to adopt the FY2020 system development charges, as recommended by staff. Ms. Adams seconded the motion. Ms. Kusek, Ms. Adams, Dr. Cannon, and Messrs. Norris, Corder, Brown, Sneeden, Zapple, Rivenbark, and Hackney voted in favor of the motion. Mr. O'Grady was opposed. Motion carried, ten to one. RESULT: REVIEWED VI. PUBLIC COMMENTS - 4 MINUTE LIMIT PER SPEAKER Ms. Markesino spoke regarding meters and residential water sampling. VII. PRESENTATION 1. Resolution for the Sweeney Water Treatment Plant Upgrades Mr. Flechtner introduced the presentation. For the past two years, emerging contaminants in the Cape Fear River and CFPUA's raw surface water have become a concern for the utility and a public issue. Staff has partnered with UNC-Wilmington and East Carolina University to research PFAS compounds. CFPUA has engaged the community in the discussion, and legal action has been filed against Chemours and DuPont. M.r Flechtner commended staff for their work. The interim project to provide PFAS filtration is almost complete. The desorption issues have been solved, and PFAs levels have gone down. The design of the long-term GAC filtration system should be complete by the end of June. Mr. Flechtner reviewed the Consent Order between the State of North Carolina (DEQ) and Chemours. The order addresses groundwater and air emissions near the Chemours site. It does not address surface water. The 70 ppt standard in the order could trigger drinking water measures for downstream users. The order includes a provision for an assessment of river sediment but does not address any remedial actions for PFAS in sediment. Mr. Flechtner reviewed the compounds listed in Attachment C of the Consent Order. It does not include all of the PFAS identified by UNC-W researchers downstream of the Chemours site. The Consent Order does not address relative or cumulative toxicity of PFAS compounds. Mr. Vandermeyden explained the interim GAC filter project. The filters in use have shallow carbon fields and are designed for particulate matter, dioxane, and disinfection by-product removal. They have been replaced in rotation so that some of the filters can be used for a level of PFAS removal. Use of the shallow filters is not a long-term solution for PFAS removal. There is a national trend wherein states have tightened regulations on PFAS levels. Connecticut, New Hampshire, New Jersey, Pennsylvania, and Vermont have standards for very low levels of PFAS. New York, Minnesota, and California are revising their Cape Fear Public Utility Authority Page 3 MinutesAuthority BoardApril 10, 2019 standards. Most of the states have addressed four or five compounds. CFPUA is faced with up to 20 compounds in its raw water. Mr. Flecthner reflected that 20-30 years ago, local leaders and staff updated the Sweeney plant with the most-advanced technology available at the time, in order to provide the community with the best water possible. CFPUA is faced with the same choice to deliver the best water it can for future generations. Should the Board approve the day's Resolution to proceed with the Sweeney long-term upgrades, the project will be bid in June. A notice to proceed should be received in November, and Bonds sold in January of 2020. The plant should be operational by early 2022. Mr. Norris presented the Resolution for the Sweeney Water Treatment Plant Upgrades. Mr. Sneeden stated that he was confident that staff and the Board had done their due diligence regarding PFAS and that authorizing the project is the proper action for CFPUA to undertake. He moved to adopt the Resolution for the Sweeney upgrades. Mr. O'Grady seconded the motion. Mr. Zapple asked if the GAC filters would have a positive impact on pharmaceuticals in the water. Mr. Flechtner reported that there are secondary benefits of the filters, including the reduction of pharmaceuticals. Mr. Norris called the question, and the Resolution was unanimously adopted. RESULT: ADOPTED \[UNANIMOUS\] MOVER: Larry Sneeden SECONDER: Kevin O'Grady AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple VIII. SPEAKER UPDATE FROM THE MARCH 13 BOARD MEETING Mr. Flechtner reported that staff is providing information to the speaker from the March meeting. Mr. Zapple requested clarification that the SDC calculation be updated to show the current number of equivalent residential units (ERUs). Mr. Norris stated that a new calculation was not part of the vote on the SDCs. Mr. Zapple moved to reopen the discussion on SDCs to include the current number of ERUs. Mr. O'Grady seconded the motion. Mr. McLean reported that the calculation had been published on CFPUA's website since February 1. Since that time, the ERUs had increased. The Board discussed choosing a cut-off date for the ERUs to be used in the SDC calculation. Ms. Miles reported that the SDC calculation, publication of the proposed SDC, and the public hearing followed statutory requirements, and the recommended SDC was what was used in the publication and hearing notice. Following discussion, Messrs. Zapple and O'Grady agreed to withdraw their motion. IX. CONSENT AGENDA Cape Fear Public Utility Authority Page 4 MinutesAuthority BoardApril 10, 2019 1.Strategic Plan RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 2. Purchase Authorization for Emergency Generator RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 3. $750,000 Emergency Construction Contract Change Order RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 4. Audit Services Contract RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 5. Easement Release - Airlie at Wrightsville Sound, LLC - Airlie Road RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 6. Easement Release - New Hanover County Alcoholic Beverage Control Board Cape Fear Public Utility Authority Page 5 MinutesAuthority BoardApril 10, 2019 RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 7. Authorization for the Executive Director to Execute a $43,350 Contract Amendment with McKim & Creed, Inc. for Force Main 14 Bidding and Construction Assistance with the City's River Road Culvert Replacement Project RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 8. Easement Release - GL & SM Partnership - Bennett Village Apartments RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 9. Authorization for the Executive Director to Execute a $173,670 Contract Amendment with Cape Fear Engineering for the Monterey Heights Interconnection - Phase II. RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 10. Easement Release - Wheel Estates II - 108 Station Road RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 11. Easement Release - Arboretum Village, LLC - 294 Military Cutoff Road Cape Fear Public Utility Authority Page 6 MinutesAuthority BoardApril 10, 2019 RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Deans Hackney, CFPUA Board Member AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 12. Land Exchange with Airlie at Wrightsville Sound, LLC RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 13. Customer Information System Project Change Order RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Patricia Kusek AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple X. NEW BUSINESS A. Administrative Reports i. Attorney's Report ii. Executive Director's Report 1. Quarterly CIP Status Report RESULT: REVIEWED 2. Key Indicators Report RESULT: REVIEWED 3. Environmental Report RESULT: REVIEWED 4. Safety Report Cape Fear Public Utility Authority Page 7 MinutesAuthority BoardApril 10, 2019 RESULT: REVIEWED 5. Town of Wrightsville Beach Interlocal Agreement Mr. Flecthner presented an interlocal agreement between CFPUA and the Town of Wrightsville Beach for bulk water sales. Since 2011, CFPUA has had an emergency connection to the Town's water supple. The Town would like to purchase water for the summer season under CFPUA's short-term water rate. The agreement is for a term of three years and contemplates consolidation of the Town's water system into CFPUA. It releases CFPUA from liability for any emerging compounds found in the water being purchased under the agreement but is silent on contamination from the Aquifer Storage and Recovery site. Mr. O'Grady moved to enter closed session to discuss a claim. Ms. Kusek seconded the motion, and it passed unanimously. The Board entered closed session at 10:02 AM, with Ms. Miles, Messrs. Flechtner and Vandermeyden, and Ms. Pope present. The Board received a report from legal counsel and discussed a potential claim. Mr. Rivenbark moved to return to open session. Mr. O'Grady seconded the motion, and it passed unanimously. Ms. Kusek moved to approve the Interlocal Agreement between the Town of Wrightsville Beach and CFPUA regarding a short-term mutual aid bulk water supply to the Town. Ms. Adams seconded the motion. Ms. Adams, Ms. Kusek, Dr. Cannon, and Messrs. Norris, Brown, Corder, Hackney, Sneeden, Rivenbark, and Zapple voted in favor of the motion. Mr. O'Grady was opposed. The motion passed, ten to one. RESULT: REVIEWED B. Committee Reports i. Executive Committee 1. Executive Committee Meeting Minutes RESULT: REVIEWED 2. CFPUA Special Meeting RESULT: REVIEWED ii. Long Range Planning Committee 1. Long Range Planning Committee - Regular - Mar 28, 2019 3:00 PM Cape Fear Public Utility Authority Page 8 MinutesAuthority BoardApril 10, 2019 RESULT: NO ACTION REQUIRED iii. Finance Committee 1. Finance Committee - Regular Meeting - Apr 3, 2019 9:00 AM RESULT: NO ACTION REQUIRED 2. Monthly Financials Report Mr. McLean presented the March financial data. With 75 percent of the years, expenditures are higher than revenues. This reflects CFPUA's deliberate plan to spend down its fund balance. There is approximately $99 million in unrestricted cash. Both the number of users (ERUs) and consumption are above budgeted numbers. RESULT: REVIEWED 3. FY20 Proposed Budget Review Mr. McLean presented a preliminary overview of the recommended FY2020 budget. The recommended budget is $85.5 million, a 4.6 percent increase over FY2019. The budget reflects a slight decrease in debt service and a 6.9 percent increase in employee compensation and benefits, reflecting a mandatory increase in the employer contribution to the local government retirement system, a market increase of 1.5 percent, and a merit pool of 2.5 percent. The budget includes $18 million in pay-go capital spending. No rate increases are necessary to support the budget. Mr. McLean reviewed departmental increases and answered questions from Board members regarding the budget. He explained principles used in developing the budget and the financial data supporting revenue assumptions. Mr. McLean presented the budget calendar. The FY2020 Capital Improvements Budget will go to the Board for approval in May. The budget hearing and adoption of budget are scheduled for the June 12 CFPUA meeting. RESULT: REVIEWED 4. Customer Service Report Ms. Irick presented the March Customer Service report. The department maintained a 100 percent service level, with over 8,000 telephone calls received, in addition to outgoing customer calls and emails. The average hold time for a telephone call was 11 seconds. Cape Fear Public Utility Authority Page 9 MinutesAuthority BoardApril 10, 2019 RESULT: REVIEWED 5. Budget Ordinance Appropriating FEMA Public Assistance Grant Funds and Other Reserves Mr. McLean presented the item. The Ordinance recognizes funds from FEMA reimbursement for Hurricane Florence. It sets aside $1.3 million in funding for filter media replacement and $492,930 in contingency funds. Mr. Brown moved to recommend approval. Mr. Zapple seconded the motion, and it passed unanimously. RESULT: APPROVED \[UNANIMOUS\] MOVER: Mike Brown, Treasurer SECONDER: Rob Zapple AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple 6. Authorization for the Executive Director to Execute a $1,595,620 Construction Contract with Herring-Rivenbark, Inc. for the Monterey Heights Interconnection - Phase II project. Mr. Vandermeyden presented the item. The interconnection will increase capacity in the southern service area. Following clarification questions, Mr. Rivenbark moved to recommend approval. Mr. Brown seconded the motion, and it passed unanimously. RESULT: APPROVED \[UNANIMOUS\] MOVER: Charlie Rivenbark, CFPUA Board Member SECONDER: Mike Brown, Treasurer AYES: Norris, Corder, Adams, Brown, Cannon, Sneeden, Hackney, Kusek, Rivenbark, O'Grady, Zapple iv. Human Resources Committee 1. Human Resources Committee Meeting Minutes RESULT: REVIEWED XI. OLD BUSINESS There was no old business. XII. AUTHORITY Q&A / CLOSING COMMENTS Mr. Sneeden reported that Lower Cape Fear Water & Sewer Authority plans to realign its raw water line crossing of Highway 421 away from the highway bridge to an underground line. He further reported that LCFWASA is developing a capital improvements plan and thanked CFPUA for leading the way in capital improvements. Cape Fear Public Utility Authority Page 10 MinutesAuthority BoardApril 10, 2019 Mr. Norris thanked the Board for its deliberation and support of the Sweeney enhancements. XIII. CLOSED SESSION The closed session occurred during the Executive Director's report and is incorporated herein by reference. XIV. ADJOURNMENT There was no further business to come before the Board, and Mr. Rivenbark moved to adjourn. Ms. Kusek seconded the motion, and it passed unanimously. The Board adjourned at 11:00 AM. The next regular Authority meeting will be Wednesday, May 8, 2019. The meeting will begin at 9:00 AM and will be held in the Lucie Harrell Conference Room, New Hanover County Administration Building, 230 Government Center Drive, Wilmington, North Carolina. Respectfully submitted, Donna S. Pope Clerk to the Board Cape Fear Public Utility Authority Page 11