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HomeMy WebLinkAbout2025-12-10 MinutesCAPE FEAR PUBLIC UTILITY AUTHORITY AUTHORITY BOARD MINUTES DECEMBER 10, 2025 Room 139 Regular Meeting 9:00 AM 230 GOVERNMENT CENTER DRIVE WILMINGTON, NC 28403 I. CALL TO ORDER Mr. Corder called the meeting to order at 9:00 AM with all members present. II. DETERMINATION OF A QUORUM A quorum of the Board was at the meeting. Those present were: Board Members: Wes Corder, Chair Deans Hackney, Vice -Chair Jessica Cannon, Secretary Bill Smith, Treasurer Jennifer Adams Leslie Hudson Hank Miller Chakema Clinton -Quintana, Councilmember David Bill Joyner, Councilmember Dane Scalise, Commissioner Rob Zapple, Commissioner Staff: Kenneth Waldroup, Executive Director Nicolette Fulton, Authority Attorney Beth Eckert, Deputy Executive Director Kevin Morris, Deputy Executive Director John McLean, Deputy Executive Director and Chief Financial Officer Lori Tayson, Human Resources Director Cord Ellison, IT Director Vaughn Hagerty, Chief Communications Officer Cammie Bellamy, Public Information Officer Robert Daughtry, Assistant Operations Director Craig Wilson, Assistant Operations Director Elizabeth Severt, Strategy & Performance Manager Ethan Walters, Strategy & Performance Analyst Sherry Brooks, HR Business Partner Sara Eskew, Deputy Clerk Makeba Robinson, Deputy Clerk Donna S. Pope, Clerk to the Board Guests: LeAnn Bagasala, Mauldin & Jenkins, PLLC Lisa Wurtzbacher, New Hanover County Jessica Loeper, New Hanover County III. ADOPTION OF AGENDA Mr. Corder presented the agenda, with one walk-in item from staff, an emergency change order. Ms. Adams moved to adopt the agenda, as amended. Mr. Smith seconded the motion, and it passed unanimously. IV. AUTHORITY MEMBER OATH Ms. Pope administered the Authority member oath to Ms. Clinton -Quintana and Mr. Joyner, and the Board welcomed them. V. RESOLUTION FOR MR. WADDELL Mr. Corder read the Resolution honoring Mr. Waddell for his service as an Authority member. Mr. Scalise moved to adopt the Resolution. Mr. Smith seconded the motion, and it passed unanimously. VI. 2025 ANNUAL COMPREHENSIVE FINANCIAL REPORT A. 2025 Annual Comprehensive Financial Report Ms. Bagasala presented the Audit and Annual Comprehensive Financial Report for the fiscal year ending June 30, 2025. CFPUA received a clean audit with no significant deficiencies or material weaknesses. She reported that CFPUA management had adopted new compliance standards early, which had helped the audit process run smoothly. There were no issues with cyber-security. Ms. Bagtasala answered clarification questions from Board members. The report will be placed on the CFPUA website for public access. VII. APPROVAL OF MINUTES A. Approval of Minutes - Regular Meeting - 11/12/25 Dr. Cannon presented the minutes for approval. Mr. Zapple noted a grammatical error and moved to approve the minutes with its being corrected. Ms. Adams seconded the motion, and it passed unanimously. VIII. PUBLIC COMMENTS - 4 MINUTE LIMIT PER SPEAKER There were no speakers. IX. CONSENT AGENDA Board members requested that several items be pulled from the Consent Agenda for clarification, as follows: Dr. Cannon - Item F; Mr. Zapple - Items C and H; and Mrs. Clinton -Quintana - Item A. Mr. Scallise moved to approve the remaining Consent Agenda items, B, D, E, G, I, J, K, and L. Mr. Smith seconded the motion, and it passed unanimously. A. Semi -Annual Human Resources Policy Review Dr. Cannon asked for an explanation of the changes to interview panel makeup in the Human Resources policies. Mr. Waldroup reported that staff had been concerned regarding potential state legislation and federal regulatory changes regarding information that could be considered part of a diversity, equity, inclusion initiative by local governments. As a result, staff recommended removing the demographic requirements for interview panels. Board members discussed impacts of legislation and legal decisions. Mr. Miller suggested taking that portion of the policies back to the HR Committee. Following further discussion, Dr. Cannon moved to adopt the policies, with the exception of Policy 23.98, Recruitment & Selection, Section 4.7.5, referring that portion of the policy back to the HR Committee for further review. Ms. Adams seconded the motion, and it passed unanimously. B. 2026 CFPUA Meeting Schedule C. $2,391,028.00 Construction Contract Award to A.C. Schultes of Carolina, Inc. for the FY 2026 Find -It -Fix -It Water and Sewer Repairs Project Following clarification between the find -it, fix -it contract and emergency repair contract,Ms. Adams moved to approve the item. Mr. Zapple seconded the motion, and it passed unanimously. D. $874,800.00 Construction Contract Award to State Utility Contractors for Emergency Services $643,416.60 Chemical Supply Contract Award to Southern States Chemical for Aluminum Sulfate bulk chemical supply to Sweeney WTP. $1,962,772.50 Design Build Services Agreement with T.A. Loving Company for the Drinking Water Main Extensions in New Hanover County Project Dr. Cannon asked for a brief review of the funding for the benefit of the new Board members. Mr. Waldroup provided an overview of projects and funding sources for New Hanover County residents with drinking water wells contaminated by PFAS. If property owners connect during the project, the cost of their connections and system development charges will be covered by grant funding. Both North Carolina and EPA grants are available for the projects. The state has a public outreach initiative to gauge citizens' interest in connecting to public water. Mr. Waldroup praised Messrs. McSmith and Morris for managing the projects and obtaining funding and thanked Engineering and Communications staff for their work in developing public forums and community outreach. Board members supported the projects and community service. Following discussion, Mr. Smith moved to approve the item. Mr. Zapple seconded the motion, and it passed unanimously. G. $198,000.00 Amendment No. 5 to the Engineering Contract with Carollo for the Northern Regional Pump Station and Force Main Phase B Project H. $432,224.00 Design Build Services Agreement with Garney Construction Company for the Twin 48" Raw Water Rehabilitation Project Mr. Zapple asked for clarification regarding the age of the raw water lines that provide water to the Sweeney plant. Mr. Waldroup reported that the original line from the City's (now CFPUA) King's Bluff intake was built in the 1940s. The Lower Cape Fear Water & Sewer Authority line was built in the 1990s. There are some parts of CFPUA's infrastructure that are 100 years old or older. Mr. Zapple moved to recommend approval. Mrs. Clinton -Quintana seconded the motion, and it passed unanimously. I. Resolution Approving Conveyance of Bench -top Analyzer to University of Memphis J. Sole Source purchase of Clarifloc Dry Polymers from Polydyne, Inc. K. Sole Source Purchase of Mec Floc Coagulant Aid Polymer from Mechanical and Environmental Control, Inc. L. Accept and Approve Calendar Year 2026 Technical Standards Updates X. NEW BUSINESS A. Administrative Reports 1. Attorney's Report Ms. Fulton thanked Mr. Zapple for attending the most recent Interbasin Transfer public comment meeting. She reported that local governments in our area have adopted a regional stance against the transfer unless it returns water to the Cape Fear River basin. She and Mr. Waldroup provided an overview of the issue for the new Board members. Ms. Fulton reported that documents related to the Motion for Summary Judgment in CFPUA's case against Chemours will not be sealed. Ms. Fulton will be canvassing Board members for available dates for a Board retreat following the holidays and for discussion topics of interest to them. Ms. Hudson requested information regarding collection and disconnection procedures and an understanding of what payment assistance may be available. Dr. Cannon requested an overview of billing structure, customer types, and the distinction between fixed and volumetric charges. Mr. Waldroup suggested that the Board might wish to invite the local state legislative delegation to a breakfast prior to the Board retreat discussion. Mr. Zapple recommended two separate meetings, as topics to be discussed with the Legislators would be different than those for the regular retreat. Ms. Fulton reported that she would keep the two meetings separate. Ms. Fulton requested a brief closed session discussion at the end of the Board meeting. 2. Executive Director's Report Mr. Waldroup presented the monthly staff reports and received direction from Board members. Key Indicators The report was in the agenda packet for review. Messrs. Morris and Wilson answered questions regarding capacity and flows to the Northside plant. Mr. Wilson answered questions regarding regeneration of the granular activated charcoal media at Sweeney. Safety Report The report was in the agenda packet for review. iii. Environmental Report The report was in the agenda packet for review. iv. Strategic Plan Update The report was in the agenda packet for review. Mr. Zapple asked if staff had identified funding for the final three miles of raw water main from CFPUA's vault on 421 to the Sweeney plant. Mr. Waldroup reported that he is working with Congressman Rouzer to apply for funding through the Army Corps of Engineers. He anticipates that being accomplished within a five-year window. V. Economic Development Projects Update The report was in the agenda packet for review. vi. Walk -In Item State Utility Emergency Construction Change Order Mr. Daughtry presented the item, and he and Mr. Waldroup answered questions from Board members. In November, staff determined that two sanitary sewer manholes were structurally compromised and put the Pine Hollow outfall on a bypass pumping system. The walk-in agenda item was to provide additional funding to the emergency services contract with State Utility Contractors to cover the project costs and extend the current contract by 90 days to allow time for the repairs and site restoration. Following clarification questions, Mr. Zapple moved to approve the contract amendment. Mr. Hackney seconded the motion, and it passed unanimously. B. Committee Reports Executive Committee Executive Committee Minutes 12/3/25 The minutes were in the agenda packet for review. 2. Long Range Planning Committee Long Range Planning Minutes 12/3/25 The minutes were in the agenda packet for review. ii. Wastewater Flow Update and Leveraging Flow Diversion The report was in the agenda packet for review. iii. Update on 54-Inch Diameter Raw Water Main Project The report was in the agenda packet for review. 3. Finance Committee Finance Committee Minutes 12/3/25 The minutes were in the packet for review. ii. Monthly Financials Mr. McLean reviewed the October -November monthly financial data. Restricted funds are $53.8 million, committed funds $22.8 million, assigned funds $33 million, and unassigned $44.3 million. The unassigned fund balance is essential to manage risks and for emergency expenses, and staff aims to keep it robust but lean. Having an appropriately -sized unassigned fund balance is reviewed favorably by rating agencies. CFPUA's annual unassigned target amount is $50 million. In the next few months, Mr. McLean will be bringing data supporting a recommendation to the Board to increase the unassigned fund balance to $65 million. Mr. McLean reviewed revenues and expenditures compared to budget. Both retail revenues and system development charges are slightly under budget. Expenditures are at 36.4 percent of budget for the fiscal year. iii. $11,780,555.00 Construction Contract Award to Carolina Civilworks Inc. for the River Road Booster Pump Station and Waterline Interconnect Mr. Smith presented the item. Mr. Zapple moved to recommend approval. Mr. Hackney seconded the motion, and it passed unanimously. iv. $880,000.00 Amendment No. 3 to the Contract for Engineering Services with CDM Smith for the River Road Booster PS and Waterline Interconnect The item was a companion to Item iii immediately preceding it. Mr. Scalise moved to approve the amendment. Mr. Zapple seconded the motion, and it passed unanimously. 4. Sustainability Committee Dr. Cannon reported that the Committee did not meet in November. 5. Human Resources Committee HR Committee Minutes 11/12/25 Mr. Miller reported that the Committee met on November 12. The minutes were in the packet for review. State Health Plan Rates 2026 Ms. Tayson reported that a majority of CFPUA employees receive health insurance through the North Carolina State Health Plan, with the plan running on a calendar year basis. The plan provides good coverage and value compared to regional peer agencies that are self -insured. Premiums increased for 2026, and there is state legislation that will create additional employer costs beginning July 1, 2026. The HR Committee previously directed staff to identify monies to mitigate premium increases for employees. Staff determined that it would be feasible to provide a stipend to employees who receive health insurance through the plan. The stipend would cover staff premium increases for the six-month period from January 1 to June 30 and would be provided to employees in January. The cost is $143,000, and taxes would be deducted from each employee stipend. Mr. McLean reported that it would add approximately 30 percent to the stipend to gross up to cover taxes. The Committee had recommended the stipend for Board approval. Ms. Tayson, Ms. Fulton, and Mr. Waldroup answered questions from Board members regarding CFPUA's participation in the State Health Plan. Following discussion, the Board directed staff to increase the stipend to assist employees with their tax burden. Mr. Scalise moved to approve the stipend with the amendment to increase the amount to account for taxes. Mrs. Clinton -Quintana seconded the motion, and it passed unanimously. Mr. Miller thanked staff for their work. XI. OLD BUSINESS There was no old business. XII. AUTHORITY Q & A / CLOSING COMMENTS There were no additional questions or comments. XIII. CLOSED SESSION Ms. Fulton reported that the items she needed to discuss in closed session could be tabled until the January meeting. XIV. ADJOURNMENT There was no further business to come before the Board, and Mr. Miller moved to adjourn. Mr. Smith seconded the motion, and it passed unanimously. The meeting adjourned at 11:00 AM. The next regular CFPUA meeting will be Wednesday, January 14, 2025. The Board will meet in Rooms 138 and 139, New Hanover County Administration Building, 230 Government Center Drive, Wilmington, North Carolina. Respectfully submitted, Donna S. Pope, Clerk to the Board