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HomeMy WebLinkAbout2024-04-10 MinutesCAPE FEAR PUBLIC UTILITY AUTHORITY AUTHORITY BOARD MINUTES APRIL 10, 2024 Room 139 Regular Meeting 9:00 AM 230 GOVERNMENT CENTER DRIVE WILMINGTON, NC 28403 I. CALL TO ORDER Ms. Adams called the meeting to order at 9:00 AM with all members present. II. DETERMINATION OF A QUORUM Attendee Name Organization Title Status Arrived Jennifer Adams Cape Fear Public Utility Chair Present Authority Deans Hackney Cape Fear Public Utility Vice Chair Present Authority Jessica Cannon Cape Fear Public Utility Secretary Present Authority Wesley Corder Cape Fear Public Utility Treasurer Present Authority William Norris Cape Fear Public Utility Board Member Present Authority Hollis Briggs Cape Fear Public Utility Board Member Present Authority William Smith 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 John McLean Cape Fear Public Utility Deputy Executive Director - Chief Present Authority Financial Office Nicolette Fulton Cape Fear Public Utility Interim Attorney Present Authority Beth Eckert Cape Fear Public Utility Deputy Executive Dir. - Enviro Mgt Present Authority & Sustainabilit Caj.')e Fear Public Utility Authority Page I Minutes Authority Board April 10, 2024 Carel Cape Fear Public Utility Deputy Executive Director - Engin. Present Vandermeyden Authority & Treatment Kristine Irick Cape Fear Public Utility Customer Service Director Present Authority Lori McKoy Cape Fear Public Utility Human Resources Director Present Authority Shannon Clayboss Cape Fear Public Utility Worforce Development Manager Present Authority Cord Ellison Cape Fear Public Utility Chief Information Officer Present Authority Cammie Bellamy Cape Fear Public Utility Public Information Officer Present Authority Maggie Butler Cape Fear Public Utlility Compliance - EMD Present Authority Julia Faircloth Cape Fear Public Utility Deputy Chief Financial Officer Present Authority Gary McSmith Cape Fear Public Utility Assistant Engineering Director Present Authority Ben Guerrieri Cape Fear Public Utility Procurement / Budget Manager Present Authority Deborah Leonard Cape Fear Public Utility HR Department Present Authority Judy Lawton Cape Fear Public Utility Executive Assistant & Deputy Clerk Present Authority Makeba Robinson Cape Fear Public Utility Compliance Coordinator Present Authority Tyler Newman Business Alliance for a Sound President & CEO Present Economy Tim Holleman Lower Cape Fear Water & Executive Director Present Sewer Authority 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 -Mar 13, 2024 9:00 AM Cal.,)e Fear Public Utility Authority Page 2 Minutes Authority Board April 10, 2024 RESULT: ACCEPTED [UNANIMOUS] MOVER: Jessica Cannon, Secretary SECONDER: William Smith, Board Member AYES: Adams, Hackney, Cannon, Corder, Norris, Briggs, Smith, Barfield, Rivenbark, Waddell, Zapple V. PUBLIC COMMENTS - 4 MINUTE LIMIT PER SPEAKER VI. CONSENT AGENDA A. No Items VII. NEW BUSINESS A. Administrative Reports i. Attorney's Report Ms. Fulton had no report for open session. ii. Executive Director's Report Mr. McLean reported that Mr. Regan, the Administrator of the Environmental Protection Agency, is making an announcement this morning regarding MCLs for PFAS. Mr. Regan will be speaking from the Public Works Commission in Fayetteville. Ms. Eckert summarized what Mr. Regan is expected to announce. Mr. McLean reminded Board members of the April 25 workshop with Innolect. 1. Key Indicators ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ............... RESULT: REVIEWED 2. Safety Report RESULT: REVIEWED 3. Environmental Report ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ............... RESULT: REVIEWED 4. Strategic Plan Update Caj.')e Fear Public Utility Authority Page Minutes Authority Board April 10, 2024 RESULT: REVIEWED B. Committee Reports i. Executive Committee 1. Executive Committee - Regular- Apr 3, 2024 10:00 AM RESULT: NO ACTION REQUIRED ii. Long Range Planning Committee 1. Long Range Planning Committee -Regular -Mar 28, 2024 3:00 PM RESULT: NO ACTION REQUIRED 2. Large Meter Testing Program and Meter Vault Upgrades RESULT: NO ACTION REQUIRED 3. Cross Connection and Backflow Update Ms. Eckert presented the item, and she and Ms. Butler answered questions from Board members. The City adopted a backflow ordinance in 1961, and CFPUA has enforced backflow prevention throughout the system since assuming operations in 2008. Backflow prevention is needed to keep contaminants from entering the public water supply. Irrigations systems and swimming pools are examples of where a homeowner would need backflow prevention. There are over 16,000 active backflow assemblies on customer properties in CFPUA's current service area. Approximately 87 percent of those customers are in compliance, obtaining annual inspections of the backflow prevention assemblies and providing the results to CFPUA. Between 4-5,000 customers may have backflow assemblies that require site visits by staff to determine compliance. Ms. Eckert explained the compliance process and reported that much of the work is now automated through UMAX software. CFPUA has the authority to issue civil penalties and to disconnect a customer's water. Responsibility lies with the customer, but staff will work with them to ensure compliance. While CFPUA staff does not make individual recommendations for test companies certified testers are listed on the website, and some of them specialize in backflow only. Staff frequently removes civil penalties from accounts once the customer provides documentation of passing inspection. To date, CFPUA has Caj.')e Fear Public Utility Authority Page 4 Minutes Authority Board April 10, 2024 not disconnected a customer due to non-compliance, but it is an option that could be exercised in the future. Board members discussed the backflow testing process and fees charged by testing companies. They directed Ms. Fulton to research if public utilities can exercise any control over fees. The Board briefly discussed the possibility of staff conducting backflow inspections and concluded it would be impractical. RESULT: REVIEWED iii. Finance Committee 1. Finance Committee - Regular- Apr 3, 2024 9:00 AM RESULT: NO ACTION REQUIRED 2. Resolution Authorizing State Loan or Grant Funding for Lead Gooseneck and Galvanized Water Service Replacement RESULT: APPROVED [UNANIMOUS] MOVER: Rob Zapple, Commissioner SECONDER: Luke Waddell, Councilman AYES: Adams, Hackney, Cannon, Corder, Norris, Briggs, Smith, Barfield, Rivenbark, Waddell, Zapple 3. Authorize the Executive Director to Amend all Active Cost Recovery Fees and add the new fees to the Rate and Fee Schedule. Mr. McLean explained the reasoning for the fee revisions. Staff needed to change the per bedroom gallon allowance for new development after the General Assembly revised the capacity allocation formula. The revisions will apply to contracts where developers are being reimbursed and where CFPUA will be reimbursed by future connections. RESULT: APPROVED [UNANIMOUS] MOVER: Jonathan Barfield, Commissioner SECONDER: William Smith, Board Member AYES: Adams, Hackney, Cannon, Corder, Norris, Briggs, Smith, Barfield, Rivenbark, Waddell, Zapple 4. Bond Reimbursement Resolution - Multiple Projects Caj.')e Fear Public Utility Authority Page Minutes Authority Board April 10, 2024 RESULT: APPROVED [UNANIMOUS] MOVER: Jonathan Barfield, Commissioner SECONDER: Luke Waddell, Councilman AYES: Adams, Hackney, Cannon, Corder, Norris, Briggs, Smith, Barfield, Rivenbark, Waddell, Zapple 5. Monthly Financials Mr. McLean reviewed changes to the regular monthly reports, which were revised to address Board requests for information and to better reflect monthly and annual statistics. The unassigned fund balance is $41.2 million. Overall usage is under budget for the fiscal year, with household use a little behind and irrigation a little ahead. Lower customer usage can allow CFPUA to stretch out capacity upgrades to infrastructure. Mr. McLean explained the debt and investment graphs in the report and answered clarification questions. RESULT: REVIEWED 6. Preliminary FY 25 Budget Mr. McLean presented an overview of the recommended budget for the fiscal year beginning July 1, 2024. Operating expenses have increased in connection to PFAS treatment. The budgeted System Development Charges have decreased because of legislative changes. A positive change is CFPUA's approval of $70 million in Clean Water State Revolving Fund loans for Southside. Debt service on those loans is not required until the project is complete. The net increase over last year's projected budget is $2,1 million, or 6.4 percent. The Human Resources Committee reviewed and endorsed staff's recommendation for a market or cost of living adjustment of 3 percent and a 3 percent merit pool. Two new positions are included in the budget, a laboratory supervisor and a utility locator. Capital improvements have risen from the $267.3 million projected last year to $326.7 million. Major drivers include construction inflation, the water and sewer infrastructure projects in partnership with the County to expand the service area into the northern portion of New Hanover County, grant -funded water mains to PFAS-contaminated wells, and large meter and valve replacements. Caj.')e Fear Public Utility Authority Page Minutes Authority Board April 10, 2024 Debt service for Southside is expected to plateau in 2030 instead of 2028, as projected last year. This can impact rate -smoothing increases that are needed to fund the project. Mr. McLean presented three options for rate smoothing, as follows: 1. Continue with four years as projected last year, with 8 percent increases; 2. (a) Rate smoothing over six years, with 4.6 percent for four and 6.5 percent for the last two; (b) Rate smoothing over six years with 4.6 percent for five and 8.5 percent in the sixth year; or 3. Even rate smoothing of 5.1 percent for six years. Board members discussed the options and how variables over the next few years could impact rates. Mr. McLean reported that the third option would present the least financial risk but that the second option has merit. A Board budget workshop is scheduled for April 16. The budget hearing will be held at the May 8 Authority meeting. The Board may adopt the FY25 budget on that date,but staff has reserved the morning of May 23 for a special meeting should the Board require more time for consideration. .. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .................. RESULT: NO ACTION REQUIRED Next: 4/16/20241:30 PM iv. Sustainability Committee The Sustainability Committee did not meet in March. v. Human Resources Committee 1. Human Resources Committee -Regular -Apr 3, 2024 11:00 AM .. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .................. RESULT: NO ACTION REQUIRED 2. Employee Compensation Recommendation FY2025 Mr. Briggs reported that the Committee reviewed the proposed pay recommendations for inclusion in the FY25 budget. .. ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... ......... .................. RESULT: REVIEWED Next: 4/16/20241:30 PM 3. Human Resources Policy Updates Caj.')e Fear Public Utility Authority Page 7 Minutes Authority Board April 10, 2024 Mr. Briggs presented the items reviewed and recommended by the Committee. The shift differential revision is needed to comply with the new payroll and HR software. Dr. Cannon voted to approve the revision. Mr. Barfield seconded the motion, and it passed unanimously. The recruitment policy revisions are needed for legal compliance and to ensure balanced and fair interviews and recruiting decisions. Mr. Norris moved to approve the revision. Mr. Smith seconded the motion, and it passed unanimously. RESULT: APPROVED [UNANIMOUS] MOVER: Jessica Cannon, Secretary SECONDER: Jonathan Barfield, Commissioner AYES: Adams, Hackney, Cannon, Corder, Norris, Briggs, Smith, Barfield, Rivenbark, Waddell, Zapple VIII.OLD BUSINESS There was no old business. IX. AUTHORITY Q & A/CLOSING COMMENTS Mr. Zapple asked what types of programs employees are using for tuition assistance. Ms. McKoy reported that most are within their fields of work. Some employees seek skills and education that will qualify them for internal promotions. X. CLOSED SESSION Mr. Rivenbark moved to enter closed session to discuss CFPUA v. Chemours and DuPont and a personnel item. Mr. Norris seconded the motion, and it passed unanimously. The Board entered closed session at 11:05 AM. The Board received reports from Ms. Fulton and Ms. McKoy. They provided direction to Ms. McKoy. XI. ADJOURNMENT Mr. Barfield moved to return to open session, and Mr. Norris seconded the motion. It passed unanimously, and the Board returned to open session at 10:24 AM. Mr. Rivenbark moved to adjourn. Mr. Norris seconded the motion, and it passed unanimously. The meeting adjourned at 10:25 AM. The next meeting of the Authority will be a Board budget workshop on April 16. The Board will meet at 1:30 PM is Rooms 138 and 139, New Hanover County Administration Building, 230 Government Center Drive. The next regular Authority meeting will be Wednesday, May 8. The Board will meet at 9:00 AM in the same location as the workshop. Caj.')e Fear Public Utility Authority Page Minutes Authority Board April 10, 2024 Respectfully submitted, Donna S. Pope Clerk to the Board Caj.')e Fear Public Utility Authority Page