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HomeMy WebLinkAbout2015-01-20 Regular Meeting MinutesREGULAR MINUTES Trophy Club Municipal Utility District No . 1 January 20 , 2015 Regular Meeting Minutes TROPHY CLUB MUNICIPAL UTILITY DISTRICT NO. 1 BOARD OF DIRECTORS January 20,2015 at 6:30P.M. 100 Municipal Drive, Trophy Club, Texas 76262 The Trophy Club Municipal Utility District No. 1 Board of Directors, of Denton and Tarrant Counties, met in a Regular Session on January 20, 2015 at 6:30 P.M., in the Boardroom of the Administration Building, 100 Municipal Drive, Trophy Club, Texas 76262 . The meeting was held within the boundaries of the District, and was open to the public . STATE OF TEXAS § COUNTIES OF DENTON AND TARRANT § DISTRICT BOARD MEMBERS PRESENT Jim Moss Jim Hase Kevin Carr Jim Thomas Neil Twomey STAFF PRESENT: President Vice President Secretary/Treasurer Director Director Jennifer McKnight General Manager Laurie Slaght District Secretary Renae Gonzales Terri Sisk Karl Schlielig Mike McMahon Danny Thomas Pam Liston Bob West Finance Manager Administration Manager Wastewater Superintendent Water Superintendent Fire Chief General Legal Counsel Legal Counsel CAll TO ORDER AND ANNOUNCE A QUORUM President Moss announced the date of January 20, 2015, called the meeting to order and announced a quorum present at 6:30p.m. CITIZEN PRESENTATIONS Bill Rose 2191nverness Drive CONSENT AGENDA 1. Consider and take appropriate action to approve the Consent Agenda. a. December 2014 check register b. November 13, 2014 Joint Meeting Minutes c. December 4, 2014 Special Meeting Minutes d. December 16, 2014 Regular Meeting Minutes e. Quarterly Investment Report: 1st Quarter FY 2015 1 of 9 Trophy Club Municipal Utility District No. 1 January 20 , 2015 Regular Meeting Minutes Motion made by Director Carr seconded by Director Twomey to approve the consent agenda as presented. Motion carried unanimously REGULAR SESSION 2. Consider and take appropriate action to approve the Fiscal Year 2014 Annual Financial Audit performed by LaFollett & Company, PLLC. Motion made by Director Twomey and seconded by Director Hase to accept the Fiscal Year 2014 Annual Financial Audit as presented by LaFollet & Company, PLLC. Motion carried unanimously 3 . Consider and take appropriate action regarding all matters incident and related to the issuance and sale of Trophy Club Municipal Utility District No . 1 Water and Sewer System Revenue Bonds, Series 2015, in the amount of $9,230,000, including the adoption of Order No. 2015-0120 authorizing the issuance of such bonds . Motion made by Director Twomey and seconded by Director Thomas to adopt Order No. 2015 -0120 authorizing the issuance of Trophy Club Municipal Utility District No. 1, Water and Sewer System Revenue Bonds, Series 2015, approving and authorizing the execution of a Paying Agent/Registrar Agreement and approving and authorizing the distribution of an Official Statement in relation to such bonds. Motion carried unanimously President Moss called the Board into a recess at 7:25p.m. President Moss reconvened the meeting at 7:43p.m. 4 . Consider and take appropriate action on matters related to Water System Improvements including: a.Presentation on Status of Fort Worth Transmission System Projects underway. b. Request proposal from the Wallace Group to perform planning study for Highway 170/114 c. Transmission Line Upgrade and Ground Storage Tank Construction . General Manager gave a presentation of upcoming Water System Improvements and has recommended to the Board that a proposal for an engineering study is solicited from the Wallace Group and brought back to the Board . Motion made by Director Carr and seconded by Director Twomey to obtain a proposal from the Wallace Group to perform planning study for Highway 170/114. Motion carried unanimously 2 of 9 Trophy Club Municipal Utility District No. 1 January 20 , 2015 Regular Meeting Minutes 5. Consider and take appropriate action to approve bid and award contract to Rey-Mar Construction in the amount of $26,774 to construct overflow drainage improvements at elevated storage tank on TW King, to authorize General Manager to execute necessary documents, and to approve funding from reserve funds. Motion made by Director Carr and seconded by Director Twomey to approve bid and award contract to Rey-Mar Construction in the amount of $26,774 to construct overflow drainage improvements at elevated storage tank on TW King, to authorize General Manager to execute necessary documents, and to approve funding from reserve funds. Motion carried unanimously 6. Consider and take appropriate action regarding the December 2014 financials. a. Combined Financials b. Variance Report Motion made by Director Carr and seconded by Director Twomey to approve the December 2014 Combined Financials and Variance Report. Motion carried unanimously 7. Consider and take appropriate action to adopt Order No. 2015-0120A establishing penalties related to District Property. Motion made by Director Thomas and seconded by Director Twomey to adopt Order No. 2015-0120A establishing penalties related to District Property. Motion carried unanimously 8 . Consider and take appropriate action to adopt Rate Order No. 2015-01208, amending Section 1.05 Temporary Water Service -Construction Meters. Motion made by Director Twomey and seconded by Director Hase to adopt Rate Order No. 2015- 01208, amending Section 1.05 Temporary Water Service-Construction Meters. Motion carried unanimously 9 . Consider and take appropriate action regarding customer service online bill payment options including : a. Approve Pace online bill payment interface for online credit card payments . b. Approve Vanco Services forE -box service . c. Approve budget appropriation of $2500 for setup fees and transactions fees in FY 2015 . d. Provide staff direction regarding proposals for new billing/accounting software. Motion made by Director Carr and seconded by Director Twomey to direct the General Manager to utilize the Pace online bill payment interface for online credit card payments, approve Vanco Services for E-box service, and approve budget appropriation of $3000 for setup fees and transactions fees in FY 2015. 3 of 9 Trophy Club Municipal Utility District No . 1 January 20 , 2015 Regular Meeting Minutes Motion is amended by the first and second to include sending information to customers that not all banks participate. Motion as Amended carried unanimously 10. Consider and take appropriate action to develop District water and wastewater infrastructure development standards for residential and commercial developments within the District boundaries and/or for service extension outside District boundaries . Motion made by Director Twomey and seconded by Director Carr to direct the General Manager to develop District water and wastewater infrastructure development standards for residential and commercial developments within the District boundaries and/or for service extension outside District boundaries. Motion carried unanimously 11. Consider and take appropriate action regarding meter change out program to upgrade customer meters to smart meters . Motion made by Director Twomey and seconded by Director Carr to direct the General Manager to come back to the board with a staff recommendation for what software we should use for meter reading and what additions should be included in the budget. Motion carried unanimously 12. Consider and take appropriate action to provide staff direction on annual water and sewer rate review. Director Thomas read a statement and requested that his statement be reflected into the minutes. (see attached) Motion made by Director Carr and seconded by Director Twomey to bring the Stowe Group back to review the rates for water and sewer. Motion carried unanimously 13 . Consider and take appropriate action to set a date for the Spring Waterfest and 40 year Anniversary Celebration . (March 21 , 2015) Motion made by Director Twomey and seconded by Director Carr to set the date of Spring Waterfest for March 21, 2015. Motion carried unanimously REPORTS & UPDATES 14. Presentation of Stage 2 Water Restrictions 4 of9 Trophy Club Municipal Utility District No . 1 January 20 , 2015 Regular Meeting Minutes General Manager McKnight gave the Board a presentat ion of the upcoming Stage 2 Water Restrictions and answered related questions. 15. Director Update: a.AWBD Mid Winter Conference b .Founders Day Celebration Director Thomas and Director Twomey updated the Board regarding the AWBD Mid-Winter Conference and the Founders Day Celebration. 16. General Manager Monthly Report for December 2014 a. Water System Operation b. Wastewater System Operation c. Website Analytics d. Information Technology Migration Status e. Finance Update • Utility Bi lling Reports • PID Connections • Perm it Collected • Fund Balance Report • Cash Need Report General Manager McKnight presented her monthly report and answered questions related thereto. 17. Fire Department Report for December 2014 Chief Thomas presented his monthly report and answered questions related thereto. The Board convened into closed session at 10:31 p.m. CLOSED SESSION The Board conducted a Closed Session pursuant to Texas Government Code , annotated , Chapter 551, Subchapter D for the following: 18. Pursuant to section 551.071, the District will consult with its attorney on a matter in which the duty of the attorney to the Governmental Body under the Disciplinary Rules of Professional Conduct of the State Bar of Texas clearly conflicts with the Open Meetings Act or to seek advice of counsel on legal matters involving pending or contemplated litigation or settlement offers: a. Agreement regarding Relocation of Utility Infrastructure Improvements {One Kirkwood Property) with BRE Solana , LLC. b. Agreement regarding Relocation of Utility Infrastructure Improvements {Solana) with Maguire Partners-Solana Land, L.P . c. Temporary Restraining Order, Temporary Injunction, and Permanent Injunction proceedings pending in the 48th District Court of Tarrant County, Texas. 5 of9 Trophy Club Municipal Utility District No . 1 January 20 , 2015 Regular Meeting Minutes d. Pending litigation in Cause No. 14-03540-158 in the District Court of Denton County relating to access to the 3.996 acres of land purchased by the District from BDMR Development, LLC, in January of 2013. e. Terms of potential lease with the Town of Trophy Club for use of District annex building located at 100 Municipal Drive. f . Conveyance of water and wastewater infrastructure requirement of service. The Board reconvened into Regular Session at 11:30 p.m. REGULAR SESSION 19 . Consider and take appropriate action regarding Closed Session items . Motion made by Director Carr and seconded by Director Twomey regarding agenda item 18(a) to approve the agreement between Trophy Club Municipal Utility District No. 1 and BRE Solana, LLC. for relocation of the sewer line around parking garage subject to confirmation of 7.01 item 3. Motion carried unanimously Motion made by Director Twomey and seconded by Director Carr regarding agenda item 18(b) to approve the agreement regarding the relocation of the 12 inch water line subject to review and approval by all of the Districts' legal counsel, designated engineer and General Manager. Motion carried unanimously Motion made by Director Carr and seconded by Director Thomas regarding agenda item 18(e) to appoint the Board members selected at tonight's Joint Meeting (Carr and Twomey) to serve on the lease agreement committee to work with the selected Town Council representatives and utilize District legal counsel to work on an agreement for lease of the Annex Building. Motion carried unanimously Motion made by Director Carr and seconded by Director Thomas regarding agenda item 18(f) to direct President Moss to prepare a letter to the Town of Trophy Club Town Manager regarding the terms of ownership and conveyance of water and wastewater infrastructure to the District, obtain Board signatures, and send to the Town. Motion carried unanimously 20 . Items for future agendas: •Consider variance request from the Town of Trophy Club Parks Department •Stowe & Co. review of current rates 21. Set next regular meeting date for February 17, 2015 . ADJOURN 6 of9 President Moss adjourned the Meeting at 11:35 p.m . Kevin R. Carr, Secretary 7 of 9 Trophy Club Municipal Uti li ty District No . 1 January 20 , 2015 Regular Meeting Minutes Director Jim Thomas Trophy Club Municipal Utility District No. 1 January 20 , 2015 Regular Meeting Minutes Comments for Jan/20/2014 MUD Meeting Concerning Sewer Rates For the past month I have tried to determine for myself if Winter Averaging made sense for our residents, especially with the emphasis Bill Rose has placed on it in our meetings and on quite a few of his Facebook postings on the Trophy Club Voice. In all honestly, I was personally offended as Bill ratcheted up his language on his postings, as well as tonight, claiming that we, as a Board, were, and I quote, "ripping off" unquote, our customers by not using Winter Averaging in calculating their monthly sewer bills. My findings have shown that the approach we have taken with the Stowe Group is sound and that Winter Averaging would actually be a detriment to our lower volume users, especially our many, many residents that are retired, travel a lot, and use less water than most. The over-riding issue is expense, which Bill has totally ignored. What expense we must cover via sewer revenues received monthly. The Stowe Group, one of the most recognized consulting firms in Texas that help municipalities, MUDs and Water Districts formulate appropriate water and sewer rates, studied our situation, especially with the upcoming planned cost of our new sewer plant, and presented our Board with options for generating the revenues that will be required. After our Board met with them several times, over quite a few months, and after numerous discussions on the various options, plus the research I have just completed, I remain personally comfortable with the current water and sewer rates we have adopted; and now feel Winter Averaging would only be a detriment, not an advantage, to our residents. Here are facts we cannot ignore. First off, Winter Averaging is only one of many different approaches that may be used to generate appropriate revenues; and one could, without considering anything else, make the statement that it more fairly allocates sewer rate costs. But the bottom-line does not change, you must raise enough revenues to cover your cost, or you must reduce your cost to be in line with the revenues you can generate. While Winter Averaging definitely would reduce the monthly cap on sewer charges our residents have to pay, in order to generate the required revenues to meet our expenses, we would have to dramatically raise either the cost per 1000 gallons for sewer, or the base charge we have in place today for sewer. Both of these penalize our low-volume users-particularly our large number of retired home owners. A simple example. If a home were to only use 4000 gallons of water during the winter months thereby setting their winter average sewer cap at this amount for the entire year, using our present rate structure they would only pay $295 for the year for sewer ($2.50/1000 gallons times 4, plus the base fee of $14.58, times 12 months). But, the average water user in Trophy Club is now in excess of 19,000 gallons a month, of which we cap their sewer cost at 18,000 gallons. Therefore, this means the average home pays $715 annually for sewer ($2.50/1000 gallons times 18, plus the base fee of $14.58, times 12 months). So, if our sewer expenses require the $715 in revenue, then the only way to generate such is to raise everyone's sewer rates significantly over the $2.50 per 1000 gallons we currently charge, or raise the base figure significantly over the $14.58 we charge, or raise both to some degree . As an example, subtract the two and you get $420 that must be recovered somewhere in the overall equation-if you are to raise the necessary money to pay your bills. Divide this by 12 and add it to the base fee and you get $49.58, versus $14.58- that every home owner would have to pay every month even if they were out of town and did not use a single drop of water. Not at all fair to our seniors and our low volume users of water. 8 of 9 Trophy Club Municipal Utility District No . 1 January 20, 2015 Regular Meeting Minutes Now I realize I'm dealing with averages; but I also know that our efforts were greatly aimed at not penalizing our small volume residential users, so the term "rip off" is just greatly offensive to me personally. Over the past several months, Bill Rose has referenced quite a few Municipalities that use Winter Averaging, but only 2 water districts. For what it's worth, in the State of Texas today, according to AWBD, less than 5% of all MUD and Water Districts use Winter Averaging when calculating their sewer rates. In a recent publication by the Texas Rural Water Association, after surveying 248 water districts, 88.64% of them do not use Winter Averaging. Ofthe 40 North Texas municipalities I studied last year to compare their water and sewer costto TCMUD1's, 26 use winter averaging. Of those 26, 16 have higher base rates for sewer than we do, and 19 have higher rates per 1000 gallons of usage. Over the past few months, Mr. Rose has named off a number of municipalities around the United States that use winter averaging. Due to this but because of time constraints, I only looked into his very first list, which he presented in our August 19, 2014 MUD monthly meeting. Of the 7 municipalities, Phoenix, Portland, Oklahoma City, Denver, Lake Havasu, St Helens and Gladstone, I looked on-line at all seven, then called 6of them today just to verify what I found. I only reached 6 today by phone for I held on the phone for Oklahoma City for well over 10 minutes then finally gave up and hung up. Therefore I could not verify their accurate base rate for sewer, but their cost per 1000 gallons I did locate online. Of the 6, 4 have base rates higher than we do and 2 are slightly less. Of interest, all 7 have higher rates per 1000 gallons than does TCMUDl. Today, a person named John in Lake Havasu's utility billing department actually commented to me when I explained our rate structure, and I quote: "You guys are really cheap". Now here's my point: Every entity dealing with water and sewer have their own set of expenses they must pay for. There are a number of ways to determine how to generate the needed revenues to pay for these expenses. Winter Averaging is just one of many methods, but based on my research, is not appropriate for use at this time by TCMUD1. My suggestion to Jennifer is that we stay with the Stowe Group's initial recommendation, which we have already adopted, and that she and her staff recommend to our Board any adjustments that need to be made, for the next several years, as our requirements change. Lastly, we all need to be very thankful that every call into our facility gets answered by a real person that then directs the call appropriately. This was not my experience today with several of the 7 cities I tried to contact. At Denver, three times when I responded to the option given to speak with a representative, I was automatically hung up. The 4th time, I tried 0, instead of what I was asked to do on the audio response, and got through. And yes, I did politely tell them about the problem in their audio response system; and was just reminded once again of our MUD's overall commitment to excellent customer service. And Jennifer, I thank you and your staff for that. 9 of 9