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HomeMy WebLinkAbout1985-04-24COUNTY SANITATION DISTRICTS OF ORANGE COUNTY, CALIFORNIA P. 0. BOX 81°27, FOUNTAIN VALLEY, CALIFORNIA 92728-8127 10844 ELLIS AVENUE CEUCLID OFF-RAMP. SAN DIEGO FREEWAYJ April 18, 1985 NOTICE OF ADJOURNED REGULAR MEETING DISTRICT NO. 1 WEDNESDAYJ APRIL 24J 1985 -4:00 P.M. 10844 ELLIS AVENUE FOUNTAIN VALLEYJ CALIFORNIA TELEPHCN ES: AREA CODE 714 s4c-291 a 962-2411 Pursuant to adjournment of the regular meeting of April 10, 1985, the Board of Directors of County Sanitation District No. 1 will meet in an adjourned meeting at the above hour and date. C:•J .... ~~ S retary -\.. .'i II BOARDS OF DIRECTORS County Sanitation Districts of Orange County, California DISTRICT No. 1 ADJOURNED REGULAR MEETING WEDNESDAY, APRIL 24, 1985 -4t00 P.M·. (1) Roll call · Pest Office Box 8127 10844. Ellis Avenue Fountain Valley, Calif., 9270E Telephones: Area Code 714 540-2910 962-2411 AGENDA (2) Consideration of motion to receive and file minute excerpts, if any (3) Long-range financial Programs: (a) Staff report o~ long-range financial program projections and status of . program implementation (b) Discussion (c) Consideration of direction to staff re long-range financial program implementation (4) Enforcement ·action for non-compliance with the District's industrial waste permit requirements .by Griffin Electronics (a) Report of General Counsel and staff (b) Consideration of motion approving stipulated enforcement agreement with Griffin Electronics pertaining to Industrial waste Permit No. 1-200 (5) Other business and communications, if any (6) Consideration of motion to adjourn Iii • 1 ... ... II MANAGER'S AGENDA REPORT County Sanitation Districts oF Orange County, California DISTRICT NO. _1_ Post Office Box 8127 10844 Ellis Avenue Fountain Volley, Calif., 92708 Teleprcnes: Area Code 714 540-2910 962-2411 MANAGER'S REPORT TO DISTRICT NO. 1 DIRECTORS MEETING DATE: APRIL 24, 1985 -4:00 P.M. No. 3: Update on the status of implementation of supplemental user fees in District No. 1 for fiscal 1985 -86 . User Fee Billing System: Last October the Board approved the following fee schedule to fund the District's financial needs: Single/Family Mu 1 ti-Family Commercial Effective Fee Type Residential Residential Ind/Govmntl Date One -time Connection $500/Dwe 11 i ng $500/Dwelling $100/1,000 1/01/85 Fee Unit Unit Square Feet Annual User Fee $60.00 $36.00 $42.95/1,000 7/01/85 Square Feet This long-range financial program was adopted after considerable study to avoid a projected $17.8 million shortfall in revenues required to finance the Districts operating expenses which are escalating due to rising costs of new advanced treatment, as well as construction of master-planned facilities improvements. The one time connection fee is collected for the Distr i ct by the cities when building permits are issued and the cities retain 5% for their services. The annual user fee is scheduled to be collected on the property tax bill commencing with the 1985-86 fiscal year. This is the most cost effective method and is the same one being used by District No. 5 and District No. 6 for collection of their supplemental user fees. Staff has been working with the County Assessor's office to initiate the computer programming modifications and data base development work necessary to enable the Assessor and the County Auditor-Controller to place the District's annual user fee on the 1985-86 property tax roll. Various programming modifications need to be made to develop a user data base, send out notices to all property owners, and prepare a computer billing tape and/or audit trail. Establishment of the data base for the large numbers of commercial and industrial facilities in District No. 1 has presented difficulties to the As sessor as each _ of the individual property records for these user groups require detailed evaluation and manual research and e xtraction of data for coding into the new District No. 1 base file. -1- ::._, -· April 24, 1985 At the present time the Assessor's systems analysis and programming staff, assisted by the County's EDP facilities management firm, is still working on the modifications required by the District to achieve full implementation of the adopted user fee program. The Assessor's staff now estimates that the modifications will be completed, tested and operational by mid-June. However, this detailed data base development work schedule, which as proven to be extremely time-consuming and burdensome, given the Assessor's limited resources, may not allow time for the District's staff to confirm the user fee rates set forth in Ordinance No. 106 for 1985-86. The Assessor's staff is aware of the District's tight time schedule for implementation of the fees and is making every effort to complete the project as soon as possible. If the programming modifications are unable to be completed soon, there may be insufficient time available to generate mailing labels, send notices to all property owners within the District as required by California Health and Safety Code Section 5473.1, and hold public meetings in time to implement the user fee in 1985-86. In light of the foregoing developments, staff has been exploring alternative methods for establishing an equitable user fee and generating bills for fiscal year 1985-86. The Directors may be aware that District No. 5, which established a supplemental user fee in 1981, bases their rate on the size of a property's water meter. District No. l's established rate is based on square footage, similar to the method used in District No. 6. District No. 5 and District No. 6 also collects their annual user fees on the property tax bill. We have been meeting with the City of Santa Ana staff regarding meter size data in the City's water system, and it appears possible to develop a data base approach, similar to the one we now use for District No. 5 1 s annual user fee billing. to generate a billing for District No. 1. Staff is continuing to study this alternative approach with the City, the Mesa Consolidated Water District (which serve s several water customers in the southeast section of District No. 1), and our District No. 5 EDP consultant and will present additional detail regarding this potential alternative to the Directors at the meeting. Financial Projections: Projections included in the 1984-85 budge ~ indicated that the District No. 1 Operating Fund would experience a de t~cit of more than $1.3 million in the 1985-86 fiscal year due to increases in operations and maintenance costs in both the local collection system and in District No. l's share of the O&M costs of the joint treatment and disposal facilities. In the 1986-87 fiscal year, the District's capital funds were also expected to end the year with a deficit of more than $3.7 million due to both increases in the District's share of capital projects for the joint facilities and more than $3.3 million in transfers from the capital funds to the District's operating fund authorized by the Board to avoid a deficit in this fund in the 1983-84 and 1984-85 fiscal years. The projected 5-year deficit was $17.8 million. -2- ... April 24, 1985 However, since the 1984-85 budget was adopted and the above long-range financial program approved, the District's financial position has improved somewhat. This is a result of delays in construction of extensive facilities improvements at the Joint Treatment and Disposal Works pending major policy decisions including the Boards' declared intent to form new District No. 14 to serve the Irvine area. Enclosed is an updated set of five-year financial projections reflecting these changes and the anticipated fiscal status of the District at the end of fiscal year 1984-85, as well as in future years through 1988-89. These projections assume the Boards proposed implementation of a change to a 100% flow-based method of allocating ownership of equity in the Joint Treatment Works (vs. the existing weighted average of assessed valuation and flow). Based on these revised estimates, the District is not now expected to have a cash shortfall in 1985-86, and the anticipated 5-year shortfall has been reduced from $17.8 million to $16.5 million (see Schedule A-1). If, however, District No. 14 is not formed, the 5-year shortfall would be $21.9 million and there would be a deficit in 1985-86 if the District paid for its increased Joint Works equity purchase requirement (resulting from the above mentioned change in the Joint Works equity allocation formula from assessed valuation and flow to flow only) in 1985-86 (see Schedule A-2). The District would, however, have the option of spreading this payment over five years under the terms of the Joint Ownership, Operation and Construction Agreement, which would eliminate the 1985-86 deficit (see Schedule A-3). Staff will discuss these updated financial projections and their relationship to implementation of the supplemental user fees in 1985-86 in greater detail at the meeting. No . 4: Enforcement Action on Industrial Waste Permitee--Griffin Electronics. Griffin Electronics located at 2115 South Hathaway, Santa Ana, currently operates under Industrial Waste Discharge Permit No. 1-200. Sample and Evaluation Programs conducted at Griffin have indicated non-compliance with the copper discharge limitation. Because of Griffin's inability to comply with the copper discharge limitation, the District required Griffin to enter into an Enforcement Compliance Schedule Agreement last year. Results of wastewater sampling conducted on four separate occasions since the expiration of the agreement indicate continued violation of the copper discharge limitation. -3- Apri 1 24, 1985 The staff has instituted enforcement proceedings and a staff level Permit Revocation Hearing was held on March 19, 1984 at which time Griffin was notified that permit revocation was being considered because of continued violation of copper discharge limitation and because fees and charges in the amount of $5,431.46 were past due and unpaid. The matter is now before the Board for consideration of the following alternative enforcement actions: 1. Revocation of Industrial Waste Discharge Permit The Board may consider permit revocation of Griffin's Industrial Waste Permit No. 1-200. Permit revocation would disallow any process wastewater discharge from the facilities until such time as the District's staff approves an installed pretreatment system which meets all of the discharge limitations and issues a new permit. 2. Stipulated Agreement As an alternative, the Board may consider entering into a stipulated enforcement agreement with Griffin setting forth stringent conditions, including, but not limited to the following: a) Payment to the District of all fees and charges that remain past due. b) Agreement by Griffin to all terms and conditions of a stipulated agreement which has been approved by the District's General Counsel. Conditions of the Agreement include posting of a $10,000 cash bond, hauling away of sludge every 10 (ten) days, liability for up to $6,000 per day in civil penalties for further discharge violations, the physical disconnection of Griffin's sewer connection if found in non-compliance, and a schedule for installation of additional pollution control facilities by May 6, 1985. It is the recommendation of staff that the Board enter into a stipulated enforcement agreement. Griffin has paid all past due fees and charges and has .consented to all other terms and conditions contained in the agreement as approved by General Counsel. This agreement is consistent with others previously approved by the Board in similar enforcement actions. -4- April 24, 1985 M·eter Size 5/8" + 3/4" 1" + lJ.:i" 2" 3" 4" 6" DISTRICT NO. 1 ESTIMATED 1985-86 SUPPLEMENTAL USER FEE REVENUES BASED UPON WATER METER SIZE Estimated Number of Meters 35,092 5,209 1,171 244 122 21 Proposed Rate $ 26.40 52.50 105.00 210.00 420 .00 840.00 ESTIMATED 1985-86 USER FEE REVENUES Estimated Revenue Raised $ 926,429 273,472 1 2 2,955 5 1,240 51,240 17,640 $1,442,976 i1EETING DATE April 24, 198 4 TIME 4 :00 p .m . DI STR I CTS 1 -----~-~---~~~-~~~~~~~~--~------·~----- DISTRICT 1 (CRAl~K),,,, ~, l , HANSON ,,,,,,~/ __ (L UX EMBO URGtR J ,GR I SET •• ,,,, __ (GREINKE ),,,,,, HOESTE REY,,, ___ _ (WI EDER),,,,,,, STANTON ,,,, • ...QL __ DISTR ICT L: lNOKBY ),,,,,,, ,CATLIN ,,,,,, (OVEii:riO~ T ),,,,, ROTH .,,,,,,·== (NEWTON),,,,,,, BUCK ,,,,,,,, (NELSON ),,,,,, .COOPER ,,,,,.-- (Lu XEMBOURGER ), GR I SET ,,,,,.-- (MAHONEY),,,,, ,HOLMB ERG,,,.-- ( S I L Z EL ) , , , , , , , KAW AN AM I , , , , -- (SCOTT) l ,,,,,,, NEAL ,,,,,,,,___:_ (CULVERJ ,, ••••• PERRY ••••• I. (tiE YER) •••• I ••• SMITH ••••••• -- lWI EDER)' l ',,,, STANTON .,,,.-- ( bEVERAGE) ••••• w I SNER I •••• ·== DI STRICT ) (OVERHO~T),,,,, ROTH .,,,,,,, (COOPER '' ••••• NELSON ••• ' I·== (THOMAS ••••••• BAILEY •• I I •• (RISNER) ••• I ••• BROWNELL •••• -- ( NORtjY),,,,,,,, CATLIN ,,,,,.-- ( PERRY ) , l , , , , , , C UL VER , , , , , , == lJA RRELLJ ,,,,, .GRIFFIN ,,,,, ( L lJX EM i30URGER), GR I S ET., , , , , -- lMAhONp), I ••• I HO LMEsERG •• I.-- (SCOTT) •• I I •••• NEAL . I I . I I I. -- (FINLAYSON) ... ' OL SON ,' I. I •• -- ( KANEL)' •• I I ••• PARTIN I • I I I .-- (SE I DEL). I ••• I. PO L IS • I •• I.-- ( s I RI AN!) •••••• SAP! EN •• I I I.-- <w 1 EDER) ••••••• STANTON ••••• -- (LANDER) •• ' •• I .SYLV I A ••••• ·== DI STRICT ) <cox ) ••••••••.• HART., •••••• (cox)., t ', ••••• MAURER ••••• ·== (WI EDERJ .,. I ••• STANTON •••• ·-- DI STRICT 6 ( GAL~ACHERL I I . WAHNER ••••• ·--( c 0 x ) • • l I • • I • • • PL UM M ER • • • • I (WIEDERJ •• I I. I .STAN TON . I I I·== DI STRICT 7 (B EYER) l ' I I I. I I SM! TH ••• I I I·-- (M I LLERJ t ······S IL LS •••• ,,, (K ENNEDYJ ••• I I .EDGAR . I. I I •• -- (L UX~M B O U RG E RL GR I S ET. I I ••• -- (COX). I ••• I. I •• MAUR ER. I I ••• -- (WI EDER) •• I. I •• STANTON ••• I.-- (GREEN).' I'. I. I WAHNER . I'''·== DISTRICT 11 (MANDI CL I •• I •• BAIL EY. I ••• I (WI EDER) I I. I I. I STAN TON •• '.·== (F I NL EY),,,, I I .THOMAS . I' I I·-- DISTRICT 13 ! BEYER) l' I' •• ' I SM I TH. ' •••• ·-- WISN ER J , '''.'.BEVERAG E •• ' I NEL SO N). l ' I .' I COO PE R •• ' I I·== OVERH OL TJ ,,,, ,RO TH,,,,,,,, __ (WI EDE R).' I I •• I S TA NTON. I I I, __ 4/24/85 J 0 INT BOARDS (THOMAS/MAND!(},, BAILEY ,,,, •• (WISNER ) •• ,,,,,, .BE VERAGE •••• -- (RISNER ), , , , , , , , , BROWNE LL , , , . -- (NEWTON ),,,,,,,,, BUCK .,,,,,,.-- ~NORB Y \.,,,,,,, .CATLIN ., •• ,·== \NELSON J ,,,,,,,, .COOPER .,, ••• (PERRY),,,,,,,,,, CULVER .,,.,.-- (K ENNEDY),,,,,,,, EDGAR .,,,,,.-- (JARR ELL), , , , l , , , GR I FF IN, , , , , -- (LUXEMBOURGER J ,,, GR I SET.,,.,, -- (CRANK ),,,,,,,,,, HANSON .,.,,.-- (COX) I I If I •• I I I I I HART . I I I •• I.-- (MAHONEY).,,,,,, ,HO LMBERG ,,,.-- (S I LZ EL),,,,,,,,, KAWANAM I ,,,.-- (COX), l ',,,,,,,, .MAURER .,,,,·== ( SC 0 TT J , , , , , , , , , , NE AL , , , , , , , , (COOPER), •• ,,,,,, NELSON .,,,-,.-- (F I NLAYSON),,,,, .OLSON ,,,,,,.-- (KAN EL), ,, , , , , , , ,PARTIN ,,,,,.-- (CULVER),,,,,,,,, PERR Y.,,,,,.-- (COX) •• l ' I ••••••• PLUMMER •••• ·== (SEIDELJ ,,,,,,,,,POLIS ,,,,,,, (OVERHOLT),,,,,, .ROTH ,,,,,,,.-- (KENNEDY),,,,,,,, SAL TARELL J , .-- ( S I R I AN I ) , , , , , , , , SAP I EN , , , , , , -- (MILLER),,,,,,,,, SILLS ,,,,,,.-- (BEYER) l,,,,,,,, .SMITH ,,,,,,.-- (W!ED ERJ,,,,,,,, .STANTON.,,,.-- (LANDER),,,,,,,, ,SYLVIA .,,,,.-- (F INL EY),,,,,,,, l THOMAS,,,,,.-- (GRE EN/ GA LLACHER JWAHNER ,,,,,, -- (BE VERAGE),,,,,, .WISNER .,,,,·== STAFF : OTHERS : 3YLVESTER ,, .~ CLARKE,,,,,, ~A~ES .,,,,,, v"" ANDERSON,,, .--v:7 BUTLER,,,,, .~ BROWN ••• I . I. v BAKER •• I.' •. -- KYLE.,,,,,,, YOUNG .,,,,,, VON LANGEN =:i2'.:: WINSOR . I I I I'---,.<- STREED . I I I I I v CLAWSON •• I I .-- WOODRUFF I ••• ATKINS. I I I I I HOHENER I I I I I HOWARD . I' I I I HUN T I I I I •• I I KEITH ...... , KNO PF •• I •• I. LE BLANC .... LINDSTROM , , , LY NCH ,,,,,,, MARTINSON ,,, PEARC E. I I . I I DISTRICT 1 ADJOURNED MEET I NG NOTES -4/24/85 , 4:00 P.M . #3 -Staff report and discussion re long-range financial program projects The General Manager reported that the purpose of this meeting is to provide the -rd with a status report on implementation of the long-range financial program . The budget process makes five year projections which identify any potential financial problems that may need to be addressed. Several years ago these projections indicated that around this time District 1 would start having a cash shortfall. The real reason for it is Proposition 13. These Districts have historically been financed by ad valorem taxes. District 1 had one bond issue in 1951 but the bulk of the financing for capi tal and operating costs has been through the ad valorem tax. When Prop 13 passed, we had to rely on connection fees and con struction grant monies to cover capital costs. When Congress adopted the Water Pollution Control Act in 1972 , they said they were going to pay a big share of the cost of upgrading treatment. At that time the eoard started putting away capital reserves to meet those requirements. Then in 1977 Congress changed the Act to allow ocean dischargers to apply for a waiver of full secondary treatment. The Orange County Sanitation Districts were the first large agency to receive this waiver. It took seven years to process our request. This has a l lowed the District to live off some of the reserves for a few years. District 1 started discussing alternative means to address this deficit and last October implemented a connection fee and user fee program. Since that time quite a bit has happened that has had a major impact on District l's financial program. One change is the proposed formation of District No. 14 which would contain about.>2,ooo acres. The good news in terms of financial impact on District 1 is that they will receive their share of the buy-in from District 14 which is about $4 million. Also, the construction of several j oint treatment works projects have been delayed. Pending a decision re District 14, because it has an affect on certain facilities that we are going to build, the whole construction plan has slipped a little so District 1 hasn 't had to spend their money as soon as they thought. Because of these events and based on the assumption District 14 will be formed, District 1 will not now have a deficit situation in 1985-86. The bad news is that as a part of this change and proposed District No. 14, the Joint Boards elected to change their historical formula of calculating each District's share of the Joint Works. In the past this has been based on A.V . and sewage flow. Because of the impact of Prop 13, that formula is no longer valid . Flows are higher proportionately than the A.V. As part of the District 14 proposal , costs will now be based on flows, which will increase District l's cost participation in the Joint Works. Another item of bad news is that wh en t h e Board adopt ed the program in October, staff was authorized to work with the County Assessor to collect the data base in order to collect fees on the tax bills. Two other Districts have similar programs--District 5 for four years and District 6 for two years. District 6 is on the same basis as District 1. Its baseline is the square footage of buildings for commercial and industrial property. The County Assessor has been required to put forth an extensive effort to update the roll and, as a result, the District's project has been set aside and we don 't anticipate being able to complete the information we need until mid-June and that may be too late to hold the necessary hearings and put this on the tax bill. As a result of this, we have been looking at some alternatives and will seek some direction as to how the Board would like to have staff proceed. \ . The General Manager added that the connection fees are currently in effect but the annual user fee is scheduled to go into effect on July 1st . One possibility is to delay the fee for another year, or reduce the fee, or direct the staff to proceed and t r y to get the user fee in based on the Assessor's ability to get the information, or direct the staff to pursue other alternatives to submit to the Board, or some combination those alternatives. He stated that it would probably be staff's recommendation that the Board meet again in the next 2-3 weeks and, hopefully, by then staff will have some of the questions answered that now remain unanswered. Mr. Sylvester then recognized Bill Butler who updated the Directors on cash flow projections and discussions with the County Assessor. He also reviewed an alternative user system. Bill then highlighted the financial position of the Districts. He referred to the best-case scenario which was the schedule if District 14 is formed within the next fiscal year. In 1985-86 the District will be in good sound condition i f District 14 is formed. They could delay user fee for another year. Referred to schedule without formation of District 14 and indicated that if the Board went to a strictly flow-based allocation of capital costs, District 1 will need to purchase approximately $6 million in capacity from the other Districts. If Distr ict 1 were asked to pay all of this in 1985-86, it would create a deficit of $4 million. This is the worst-case scenario. He then referred to the schedule where District 1 would purchase capacity from other Districts and spread the purchase over four years. Would not have a lot of money in the fund balance but could get by. Director Griset asked if the District 14 is formed, what portion of the District 1 boundary changes? It was explained that District 14 will not change District l's boundaries at all. It would only purchase capacity from them. Griset then asked about t he schedule for formation of District 14. The General Manager advised that the Board approved an agreement in March with IRWD to proceed with formation of District 14. It will technically be called a Reorganization according to LAFC proceedings. The EIR is in a d r aft stage now and anticipate it will be presented to the Board at the regular May 8th meeting to be received and filed and set for public hearing. The public hearing and the end of the comment period will be in June. The EIR is tentatively scheduled to be finalized in July. The agreement between each of the Districts and IRWD spells out all of the conditions, capacity and costs, etc. of the formation. The Von Karman Trunk Sewer will connect District 14 to the system. The Directors further discussed the policy decision of the Board changing the formula to flow only. The connection fee is allocated on the basis of dwelling units and is based on square footage for commercial and industrial properties. The user fee is based on a fixed amount and on use of the system on an average basis. Mr. Sylvester added that it is the Boards' policy to continue to fund their operating costs on their share of the 1% of the property tax. Our historical share is about 3%. This new fee would show as a separate item on the tax bill. Director Hanson asked what the chances were of getting this fee on the 1985-86 bills? Bill Butler said he didn't really feel that the Assessor was going to make it on a timely basis. The Santa Ana area is much more heavily industrial than the Costa Mesa area (Dist. 6) 2,500 industries in District 6 and 7-10,000 in District 1. The problem that that creates is that the Assessor does not have the commercial/industrial files automated so they can create the data base we need. So there is a significant manpower effort on the part o f the Assessor. He added that we have experienced some problems in getting access to the records we need and they won't let the Districts' staff help them or use their files. He said he didn't feel comfortable that the necessary schedule could be met. -2- ; He then reported that what we have done in District 5 the last two years was to develop a fee based on water meter size. In District 5 the City and Water District boundaries are virtually the same. They provide us acquisition to their water billing files and we develop a rate based upon water meter size. AAi.-'- Staff has contacted the City of Santa Ana and the~rtonsolidated Water fv \ ~ District (?) which provide service to all of District 1 . The staff discussed adopting the same plan for District 1 as Distr i ct 5--establishing a charge based on water meter size effective July 1 s t . A blue schedule was distributed indicating preliminary estimates of revenue if District 1 were to adopt this kind of approach. The District cou ld generate $1.4 million based on same fees as District 5 originally adopted. Mr. Sylvester commented that the fees indicated in the yellow Manager's Report were set at a time when they were looking at a much larger deficit than they are looking at now. The commercial square footage is really unknown. The assessor has to manua l ly go through and update his files . Griset asked if $1 .4 million is what the Distric t needed to raise? The General Manager replied no, that the table shows a system based on water meter size using the same rate as District 5 and what it would raise. There is no correlation between the $1.4 million and what District l's needs now. He then reiterated the financial benefit to the Di strict if District 14 is formed. Hanson questioned the amount of the fee versus what District 6 will be collecting. Mr. Sylvester explained that the Boards set the fee depending upon each individual District's financial situation . The problem with each system is to collect these fees on the tax b i ll. They will not be on the water bill. He advised that they don't have to hold a public hearing to fix the fee but to collect it on the water bill. Have to mail a notice to every property owner. The constituents may think the hearing is to set the fee but it is to collect the fee on the tax bill. The General Ma n ager then recommended that the staff be authorized to proceed and get some more information on this alternative and if it can be imple mented in the 1985-86 fiscal year. Staff would update Directors on this at the May 8th Joint Board Meeting. Would probably suggest that the Board adjourn to another meeting where the staff could give a more complete report. Director Hoesterey summarized the District's financial situation and possible alternatives. He reite rated that the ye llow sheet has fees al ready approved by the Board b u t there is a problem with the Assessor . The blue sheet is based on a different method based on water meter size. Whether or not they need the money is still another q uestion depending u pon the possibility of District 14 being incorporated into the Districts. Asked how long District 14 had to buy-in? He was told the anticipated formation date for District 14 would probably be October and they would make the i r initial payment of $4 million to District 1 within 15 days of formation. Their second payment is due within five months so all of the money would be received in 1986-86. Hoesterey asked what the probability was of this going as planned? JWS replied that that was a political question but that the Joint Boards had declared their intent to form this District. There has been some concern expressed by residents of Fountain Valley and the F.V. City Council. Those concerns will be addressed in the EIR process in the next few months. The public hearing will be on June 12th. Hoesterey added that they really wouldn't have the answer re whether or not they needed the money until sometime in July then. WHB commented that any year beyond 1985-86 shows a deficit and the blue alternative allows them to phase into the fees that are going to be required. Griset questioned the data base information on the meter size alternative. Bill advised that we would create the tape ourselves with this alternative and take -3- ,\ it to the County Assessor and then turn it in to the County Auditor no later than August 9th. Director Hoesterey then MOVED that the staff be directed to go ahead and look into the mechanics of setting this up and come back to the Board with a proposed rate schedule. Motion SECONDED by Griset. Mr. Sylvester added that under this method they wouldn't have to deal with all 42,000 parcels. The 35,000 single family dwellings would be eliminated and would only have to deal with 6-7,000. Bill Butler added that this alternative program would require the services of an outside consultant to create the data base and the consultant has estimated a total fee not to exceed $15,000. Hoesterey AMENDED HIS MOTION to include authorization to engage the consultant for an amount not to exceed $15,000. The maker of the second agreed. VOICE VOTE on motion. MOTION CARRIED. #4 -Report of General Counsel and staff re Griffin Electronics The General Manager reported that Griffin Electronics, located on South Hathaway in Santa Ana, has had a problem in complying with the copper limitation. We have instituted staff level enforcement action. Following completion of that work, we have sampled them and they appear to continue to be in violation. The next level of enforcement is to bring it to this Board. Our attorneys and industrial waste people have been meeting with the firm to resolve this problem. The Board has two alternative--to proceed to hold a hearing to revoke their permit which would prevent them from discharging any waste into the system, or we can force them to enter into a stipulated agreement with the District that provides some stringent conditions that they must comply with which includes posting a bond and installating equipment, e tc. The General Counsel has drafted an agreement similar to what we have had in the past. They have posted the first $5,000 of the bond and were to bring in the other $5,000 the following day. Tom Woodruff added that District 1 has had some of these in the past in lieu of revocation. The terms are very strict and the agreement is designed so the District does not suffer any additional financial loss. This agreement has a detailed schedule of events, some of which have already been met. One of the key provisions is in the event of a violation in the future, we have the right, without holding a hearing, to simply revoke their permit. They also have to pay all of the outstanding invoices and put up a $10,000 deposit. The second $5,000 should be in tomorrow morning. Griset then MOVED the staff's recommendation to approve a stipulated enforcement agreement with Griffin Electronics. Motion SECONDED and CARRIED. #5 -Other Business re V.A.L Circuits The General Counsel reported that the District had previously had a similar situation with V.A.L. Circuits. They have an agreement with scheduled compliance dates. Th e Industrial Waste Department has worked with their designers and requested certain changes to modify their system. This resulted in some time delays in construction work and they were not able to meet the dates in their agreement. The Industrial Waste Department recommends a uthorizing an extens ion of about 60 days. The final date for completion of the project has not cha nged at all. He said we feel it is appropriate to keep the string taunt so want to approve an amendment to their agreement to amend those dates. The last compliance date of August 12th has not been adjusted. Mr. Woodruff stated that i f this is acceptable to the Board, he asked they consider approving Amendment No. 1 to the stipu lated Agreement with V.A.L . Circuits, Inc. It was so MOVED, SECONDED and CARRIED. -4- ---- COUNTY SANITATION DISTRICT NO. 1 OF ORANGE COUNTY, CALIFORNIA MINUTES OF ADJOURNED REGULAR METING April 24, 1985 -4:00 P.M. 10844 Ellis Avenue Fountain Valley, California Pursuant to the adjournment of the regular meeting of April 10, 1985, the Board of Directors of County Sanitation District No. 1 of Orange County, California met in an adjourned regular meeting at the above hour and date in the Districts' Administrative Offices. The Chairman called the meeting to order at 4:20 p.m. The roll was called and the Secretary reported a quorum present. DIREcrORS PRESENT: DIRECTORS ABSENT: STAFF MEMBERS PRESENT: OTHERS: Robert Hanson, Dan Griset, Ronald B. Hoesterey Roger Stanton J. Wayne Sylvester, General Manager, Rita J. Brown, Secretary, Thomas M. Dawes, Blake Anderson, William H. Butler, Gary Streed, Richard von Langen Thomas L. Woodruff, General Counsel * * * * * * * * * * * * * Receive and file minute excerpt re Board Appointments Moved, seconded and duly carried: That the minute excerpt from the City of Tustin re election of mayor, appointment of an Alternate Director, and seating new members of the Board, be and is hereby, received and ordered filed, as follows (*Mayor): Active Director Ronald B. Hoesterey Staff report on long-range financial program projections and status of program implementation Alternate Director Frank Greinke* The General Manager presented an overview of the District's fiscal position, and described the major changes that have occurred since the Directors adopted the District's long-range financial plan in October, 1984. He noted that several major things have occurred that will improve the District's short term financial condition: -delays in construction of major capital improvements at the Joint works treatment facilities pending the Joint Boards decision to form proposed District No. 14 to provide sewer service to the Irvine Ranch Water District service area -the potential financial benefit to District No. 1 as a result of allocation of funds to the District from IRWD's purchase of capacity in the Joint Works facilities relative to formation of ·proposed District No. 14. -1- ___ ___,....,,._ _____ __.,..__,,_-.--~~7" .. ,.--:""" . ..,..._ ..,........"":":v-:".,,..........'"":':"':'""-:-0:-...,_.....,.....~.,.,...........,.......,.~~--=,..,--~-..!...------~---· --------------------------..... . .. 4/24/85 He pointed out that long-term fiscal requirements would be increased because of the Joint Boards decision to shift calculation of each District's percentage of equity in the Joint Works from a three-year weighted average of assessed valuation and flow to a 100% flow-based equity ownership approach. Mr. Sylvester also indicated that since the Board authorized .implementation of supplemental user fees commencing in 1985-86, the staff had been working closely with the County Assessor to develop a data base of all customers in District No. l and to modify existing computer programs developed by the Assessor to enable the proposed user fee to be placed on the 1985-86 County of Orange property tax bill. The Assessor's staff has been working diligently in support of the-District's user fee implementation program, however, other conunitments as well as the Assessor's limited staff resources have delayed completion of both the programming modifications and development of the user data base, specifically due to the large numbers of commercial and industrial facilities that need to be identified in District No. l. The General Manager pointed out that due to these unavoidable delays the staff had started to evaluate an alternative method for developing a data base of users in District No. 1, and had participated in preliminary discussions with the City of Santa Ana to determine whether or not the District could establish a supplemental user fee program based upon water meter size data available via the city's computer-based utility billing system. This method has been employed successfully elsewhere by the Districts. Following a review of the alternatives available for implementation of the long-range financial plans the Director of Finance then presented various cash flow projections outlining the impact of the various changes that have occurred since the Board adopted the financial program and presented revenue projections of the alternative implementation plans to the Directors. The Directors then entered into an extended discussion regarding the relative merits of the available methods for developing a customer data base and implementing a supplemental user fee to put the District on a fiscally sound basis over the long term. Authorizing staff to procure services for supplemental user fee data base development and EDP support Moved, seconded and duly carried: That the staff be, and is hereby, authorized to procede with development of an alternative user charge program utilizing water purveyor information for the basis and data basei and, FURTHER MOVED: That staff be authorized to procure necessary services for data base management providing for programming and data processing to provide data base information, mailing labels and parcel charge tapes relative to planning and implementation of supplemental user fees to be collected on the property tax bill for an amount not to exceed $15,000.00. Staff report re enforcement action The General Manager reported that for non-compliance against Griffin Electronics, an electroplating Griff in Electronics firm located in Santa Ana, has experienced difficulties in achieving and maintaining compliance with the limitations on copper discharge set forth in the District's industrial waste ordinance. Mr. Sylvester stated that the staff bad initiated enforcement action and outlined the alternative enforcement actions ~ -2- ·'-~ .• 4/24/85 ,tlJI. available to the Board to force compliance by Griff in. The General Counsel reported th~t he had prepared a stipulated agreement specifically defining conditions for installation of pretreatment equipment to effectively control the discharge, posting of a $10,000 bond to ensure compliance, and establishing a detailed compliance schedule as one alternative used by the Board in the past in similar enforcement actions. He stated that Griffin Electronics had signed the stipulated agreement and had posted the bond. The firm desires to avoid permit revocation and has already begun to carry out various provisions of the agreement. He also pointed out that in the event the permittee violates the agreement, the Board could simply revoke the company's permit and call the $10,000 bond, which would protect the District from any additional financial loss. Approving stipulated agreement with Griff in Electronics Moved, seconded and duly carried: That the stipulated enforcement agreement with Griffin Electronics pertaining to Industrial waste Permit No. 1-200, dated April 24, 1985, be, and is hereby, approved, as recommended by the staff and General Counsel. Approving Amendment No. 1 to the stipulated aqreement with v.A.L. Circuits, Inc. The General Counsel advised the Directors that the District had previously entered into a stipulated enforcement agreement with V.A.L. Circuits, Inc. which included specific compliance dates. Based upon the Industrial Waste Division's recent review of the company's status relative to compliance with the schedule, the staff had requested certain modifications to the pretreatment system that would delay the installation. It is, therefore, necessary to request a modification of certain dates in the schedule and the Industrial Waste Division and the General Counsel recommended that the Board approve proposed Amendment No. 1 to the District's existing agreement with V.A.L. Circuits, Inc. to revise the compliance dates. While certain scheduled dates would be extended sixty days, the General Counsel indicated that the final compliance date of August 12, 1985, set forth in the original agreement would not change. It was then moved, seconded and duly carried: That Amendment No. 1, dated April 24, 1985, to the Stipulated Enforcement Agreement with V.A.L. Circuits, Inc. pertaining to Industrial Waste Permit No. 1-350, be, and is hereby, approved. Adjournment Moved, seconded and duly carried: That this meeting of the Board of Directors of County Sanitation District No. 1 be adjourned. The Chairman then declared the meeting so adjourned at 5:25 p.m., April 24, 1985. '-. ..... C),·~~ Secretary, '"'BOd of Directors Co~.-Sanitation District No. 1 of Orange County, California -3- -··--------