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HomeMy WebLinkAbout2023-02-08 MinutesCAPE FEAR PUBLIC UTILITY AUTHORITY AUTHORITY BOARD MINUTES FEBRUARY 8, 2023 Lucie Harrell Conference Room Regular Meeting 9:00 AM 230 GOVERNMENT CENTER DRIVE WILMINGTON, NC 28403 I. CALL TO ORDER Ms. Adams called the meeting to order with a quorum present. Mr. Norris moved to excuse Mr. Hackney. Mr. Rivenbark seconded the motion, and it passed unanimously. II. DETERMINATION OF A QUORUM Attendee Name Organization Title Status Arrived Jennifer Adams Cape Fear Public Utility Chair Present Authority Wesley Corder Cape Fear Public Utility Vice -Chair Present Authority Jessica Cannon Cape Fear Public Utility Secretary Present Authority William Norris Cape Fear Public Utility Treasurer Present Authority Deans Hackney Cape Fear Public Utility Board Member Excused Authority Hollis Briggs Cape Fear Public Utility Board Member Present Authority Larry Sneeden Cape Fear Public Utility Board Member Present Authority Jonathan Barfield Cape Fear Public Utility Commissioner Present Authority Charlie Rivenbark Cape Fear Public Utility Councilman Present Authority Luke Waddell Cape Fear Public Utility Councilman Present Authority Rob Zapple Cape Fear Public Utility Commissioner Present Authority Kenneth Waldroup Cape Fear Public Utility Executive Director Present Authority Linda Miles Miles Firm, PLLC CFPUA Consulting Attorney Present Nicolette Fulton Cape Fear Public Utility Deputy Attorney Present Authority Cal.,)e Fear Public Utility Authority Page I Minutes Authority Board February 8, 2023 Frank Styers Cape Fear Public Utility Deputy Executive Director Present Authority Carel Cape Fear Public Utility Deputy Executive Director Present Vandermeyden Authority Beth Eckert Cape Fear Public Utility Director of EMD Present Authority Lori McKoy Cape Fear Public Utility Human Resources Director Present Authority Vaughn Hagerty Cape Fear Public Utility Public Information Officer Present Authority Cord Ellison Cape Fear Public Utility Chief Information Officer Present Authority Cammie Bellamy Cape Fear Public Utility Assistant PIO Present Authority Julia Faircloth Cape Fear Public Utility Deputy Chief Financial Officer Present Authority Judy Lawton Cape Fear Public Utility Executive Assistant Present Authority Jim Iannucci New Hanover County Present Jeff Adkins HDR Present Donna S. Pope Cape Fear Public Utility Clerk/Executive Secretary to the Present Authority Board III. ADOPTION OF AGENDA Mr. Rivenbark moved to adopt the day's Agenda. Mr. Norris seconded the motion, and it passed unanimously. IV. APPROVAL OF MINUTES 1. Authority Board -Regular Meeting -Jan 11, 2023, 9:00 AM RESULT: ACCEPTED [UNANIMOUS] MOVER: Jessica Cannon, Secretary SECONDER: William Norris, Treasurer AYES: Adams, Corder, Cannon, Norris, Briggs, Sneeden, Barfield, Rivenbark, Waddell, Zapple EXCUSED: Hackney V. PUBLIC COMMENTS - 4 MINUTE LIMIT PER SPEAKER There were no public speakers. VI. CONSOLIDATION UPDATE PRESENTATION Mr. Adkins presented the report, which will also be given to the Wrightsville Beach Board of Aldermen. He thanked Messrs. Sneeden and Hackney for their dedication to the joint Caj.')e Fear Public Utility Authority Page 2 Minutes Authority Board February 8, 2023 consolidation working group that includes Aldermen representatives and Town staff as well as CFPUA Board members and staff. The consolidation study and the supporting rate study were funded by a State grant. Mr. Adkins then reviewed the goals of the consolidation study and the process used by the working group, HDR, Highfill, and Raftelis, the group conducting the rate and economic impact study. Should CFPUA and the Town decide to move forward with consolidation, the goal is for the final interlocal agreement to be fair and reasonable for both entities and their customers. It would also provide a dependable, economically feasible, long term water source for the Town. The consultants and working group have five areas to analyze, as follows: 1. Project initiation and data review of the Town's system; 2. Infrastructure needs to support a successful consolidation; 3. Operational and organizational structure, including employee transfers from the Town to CFPUA; 4. Developing a financial pro -forma model; and 5. Developing and drafting an ILA supporting consolidation. An important part of the study is to define capital improvements needed to the Town's water and sewer system and any capital improvements that might be needed for CFPUA to assume operations of the Town's system. This includes meter compatibility as well as larger infrastructure needs. The infrastructure analysis is continuing and expected to take an additional six weeks. The financial component of the study is ongoing. It includes consideration of a cost recovery period to pay for Town infrastructure needs and the potential of a rate differential or surcharge to pay for infrastructure needs that CFPUA may be addressing in the consolidated system. The financial study is also expected to continue for six weeks. Should the Boards choose to move forward with consolidation, the State would need to transfer permits from the Town to CFPUA. Wilmington City Council and the New Hanover County Commissioners must approve any agreement, as CFPUA's founding entities. There would be a transition period of at least six months to ensure a smooth transfer of real property, easements, and to address operational needs. Proactive communication with customers, particularly Town customers, will be of vital importance. Caj.')e Fear Public Utility Authority Page Minutes Authority Board February 8, 2023 Mr. Adkins and staff answered questions from Authority members regarding infrastructure needs, the Town's rate structure, and the potential of Wrightsville Beach representation on the Authority Board. VII. CONSENT AGENDA 1. $1,534,000 Contract Amendment # 1 with McKim and Creed for the Northern New Hanover County Water and Sewer Main Project RESULT: APPROVED [UNANIMOUS] MOVER: William Norris, Treasurer SECONDER: Jonathan Barfield, Commissioner AYES: Adams, Corder, Cannon, Norris, Briggs, Sneeden, Barfield, Rivenbark, Waddell, Zapple EXCUSED: Hackney 2. Audit Services Contract RESULT: APPROVED [UNANIMOUS] MOVER: William Norris, Treasurer SECONDER: Jonathan Barfield, Commissioner AYES: Adams, Corder, Cannon, Norris, Briggs, Sneeden, Barfield, Rivenbark, Waddell, Zapple EXCUSED: Hackney 3. Resolutions Accepting Grant Funding Offers for the Wrightsville Beach Consolidation Study RESULT: APPROVED [UNANIMOUS] MOVER: William Norris, Treasurer SECONDER: Jonathan Barfield, Commissioner AYES: Adams, Corder, Cannon, Norris, Briggs, Sneeden, Barfield, Rivenbark, Waddell, Zapple EXCUSED: Hackney VIII. NEW BUSINESS A. Administrative Reports i. Attorney's Report Ms. Miles had no report for open session but requested a closed session to discuss CFPUA v. Chemours and DuPont. ii. Executive Director's Report Caj.')e Fear Public Utility Authority Page 4 Minutes Authority Board February 8, 2023 1. Key Indicators Report Mr. Zapple observed that development services inspections have increased, indicating growth in building. Mr. Vandermeyden answered questions regarding rainfall and bacterial levels at the Southside wastewater treatment plant. tESULT: REVIEWED 2. Safety Report ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .............. tESULT: REVIEWED 3. Environmental Report tESULT: REVIEWED 4. Strategic Plan Update ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .............. tESULT: REVIEWED B. Committee Reports i. Executive Committee 1. Executive Committee - Regular- Feb 1. 2023. 10:00 AM ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .............. tESULT: NO ACTION REQUIRED 2. CFPUA Legislative Priorities The Board reviewed its legislative priorities for the coming year. Mr. Zapple moved to add requests for Federal level funding for infrastructure matters. Mr. Sneeden seconded the motion, and it passed unanimously. Mr. Norris moved to adopt the 2023 Legislative Priorities, as amended. Mr. Rivenbark seconded the motion, and it passed unanimously. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .............. tESULT: REVIEWED ii. Long Range Planning Committee Caj.')e Fear Public Utility Authority Page Minutes Authority Board February 8, 2023 The Committee did not have a quorum at its January meeting. The informal discussion was recorded and will be shared with the full Board. iii. Finance Committee 1. Finance Committee -Regular Meeting- Feb 1, 2023, 9:00 AM .. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .................. RESULT: NO ACTION REQUIRED 2. Monthly Financials Mr. McLean presented the financial report. December 31, 2022, completed half of the fiscal year. The change in fund balance was negative $5.9 million, with a $50.3 million unassigned fund balance. With 50 percent of the year complete, expenditures were at 48.9 percent of budget. Through January 31, with 58.33 percent of the fiscal year complete, revenues were at 61.43 percent of budget. Mr. McLean reported that he will present a first look at the FY2024 budget to the Board at the April meeting. While inflation is coming down, the CPI is 6.5 percent and energy and chemical costs have gone up approximately 62 percent over last year. Mr. McLean reported that Raftelis, CFPUA's rate consultant, is reviewing the SDC calculation and rate model. He presented rate projections should CFPUA move to a rate -smoothing methodology. Rate smoothing would lessen large increases for big projects that require the issuance of bonds, such as the Southside project. Mr. McLean reported that a change to the rate structure could also consider affordability and tiers but would probably not be presented to the Board for consideration until FY2025. Board members discussed the rate -smoothing methodology. Mr. McLean answered questions regarding water treatment costs related to PFAS removal. RESULT: REVIEWED 3. Growth Policy Update Mr. Norris referred Board members to the growth policy update in the agenda packet. .. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .................. RESULT: REVIEWED Next: 3/8/2023 9:00 AM iv. Sustainability Committee Caj.')e Fear Public Utility Authority Page Minutes Authority Board February 8, 2023 The Committee did not meet in January. C. Consolidation Study Update 1. Consolidation Study Update Mr. Sneeden presented the monthly consolidation update and answered questions from Authority members. RESULT: REVIEWED Next: 3/8/2023 9:00 AM IX. OLD BUSINESS X. AUTHORITY Q & A/CLOSING COMMENTS Ms. Adams reported that Judy Lawton and Makeba Robinson are starting the School of Government Clerks' School this month. Ms. Robinson competed for and received a partial scholarship from the Local Government Employees' Credit Union to cover the costs of enrollment. Board members commended Ms. Robinson's initiative. XI. CLOSED SESSION Mr. Rivenbark moved to enter closed session to discuss CFPUA v. Chemours and DuPont. Mr. Briggs seconded the motion, and it passed unanimously. The Board entered closed session at 10:15 AM. The Board received a report from Ms. Miles and Mr. Waldroup. Mr. Rivenbark moved to return to open session. Mr. Briggs seconded the motion, and it passed unanimously. The Board returned to open session at 10:30 AM. In open session, the Board discussed requests from citizens within the County who are interested in receiving CFPUA services. Some requests are for sewer service, and many are for water service following private well testing by Chemours. Mr. Waldroup reported that staff is working with property owners who are adjacent to water lines and can connect. CFPUA staff has requested that New Hanover County update its 2007 water and sewer prioritization list. CFPUA can the use the list in assessing water and sewer needs and developing plans to address those needs. Mr. Waldroup reported that the Rock Hill community should be high priority, as it was the fourth community in 2007. Marquis Hills and Heritage Park were the two highest priority in 2007. Marquis Hills now has sewer, and Heritage Park has water and sewer. For any expansion into an existing community, funding is the biggest issue. Mr. Sneeden reminded the Board that CFPUA cannot require connection to a water line once it is built. The Caj.')e Fear Public Utility Authority Page 7 Minutes Authority Board February 8, 2023 Board discussed the existing growth policy. The Board discussed whether CFPUA or the County should employ a person dedicated to analyzing and prioritizing community expansion. Board members discussed the possibility of funding partnerships. Mr. Barfield reported that he, Mr. Zapple, and Commissioner Bill Rivenbark supported the County's partnering with CFPUA and communities to develop funding resources for expansion. Ms. Adams will attend a meeting in the Rock Hill community on February 23. Mr. Briggs stated that he would attend the meeting. Mr. Zapple suggested that County DHHS staff be invited to attend. XII. ADJOURNMENT There was no further business to come before the Board, and Mr. Waddell moved to adjourn. Mr. Briggs seconded the motion, and it passed unanimously. The meeting adjourned at 11:05 AM. The next regular Authority meeting will be Wednesday, March 8, 2023. The Board will meet at 9:00 AM 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 Caj.')e Fear Public Utility Authority Page