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HomeMy WebLinkAbout2006-02-21 WUCFD MINUTESWATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY) CITY OF APACHE JUNCTION,ARIZONA REGULAR MEETING FEBRUARY 21,2006 The regular meeting of the District Board of the Water Utilities Community Facilities District (Apache Junction Water Company),City of Apache Junction,Arizona,was held on February 21,2006,at the Apache Junction City Council Chambers pursuant to the notice required by law. CALL TO ORDER Chairperson Coleman called the meeting to order at 6:00 p.m. ROLL CALL Board Members Present:Chairperson Douglas Coleman Vice Chairperson R.E.Eck,Jr. Mr.Rick Dietz Mr.John Insalaco Mr.Joseph Severs Mr.Kris Sippel Mr.Dave Waldron Staff Present:George Hoffman,District Manager Kathleen Connelly,District Clerk Brian Hall,District Operations Manager Kay Bigelow,District Counsel John White,District Finance Manager Others Present:Assistant City Manager Bryant Powell APPROVAL OF MINUTES OF JANUARY 17,2006 ) )Mr.Dietz MOVED THAT THE MINUTES OF JANUARY 17,2006,BE APPROVED. Mr.Waldron SECONDED THE MOTION. VOTE:Unanimous. Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 1 of 8 The motion carried. CONSIDERATION OF INTERGOVERNMENTAL AGREEMENT WITH THE CITY OF MESA FOR TREATMENT AND DELIVERY OF THE DISTRICT'S ALLOTMENT OF CENTRAL ARIZONA PROJECT (CAP) WATER )District Counsel Kay Bigelow briefed the board on the item.She stated the agreement allows the district to connect to a distribution line of water that has been treated through their plant but it would be the district's Central Arizona Project water allocation. It determines the length of the term,which is ten years,and they must give the district a two-year termination notice.The latter was added to hopefully show the Department of Water Resources that we are using a renewable resource. Additionally,a pricing structure was determined.They will be charging a certain amount once the water starts being delivered.It basically covers their debt service types of costs on the plant plus a per unit charge,with a unit normally being 1,000 gallons.It is the same amount of money they thought they were going to spend.If no water is taken during any month,the district will still be charged the base amount.They also charge Arizona Water the same way. Vice Chairperson Eck asked if this is for the wheeling agreement or if this is for treatment and the wheeling. District Operations Manager Brian Hall spoke from the audience but was unintelligible due to his distance to the microphone. Vice Chairperson Eck commented this covers the wheeling and the actual treatment of the tie in. Chairperson Coleman closed the discussion with no further comments and called for &motion. Mr.Waldron MOVED THAT THE INTERGOVERNMENTAL AGREEMENT BETWEEN THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION,ARIZONA),AND THE CITY OF MESA FOR TREATMENT AND DELIVERY OF THE DISTRICT'S ALLOTMENT OF CENTRAL ARIZONA PROJECT (CAP)WATER BE APPROVED. Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 2 of 8 Mr.Dietz SECONDED THE MOTION. VOTE:Unanimous. The motion carried. RESOLUTION NO.2006-003,RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION,ARIZONA) AUTHORIZING THE AMENDMENT OF THE INDENTURE FOR THE SERIES 1997A BONDS; RESOLUTION NO.2006-004,RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CTIY OF APACHE JUNCTION,ARIZONA)REVOKING RESOLUTION NO.2004-005 AND SUBSTITUTING INSTANT RESOLUTION:AUTHORIZING THE PROJECTS AND THE REFINANCING OF THE 2001 WATER INFRASTRUCTURE FINANCE AUTHORITY ("WIFA")LOAN:AND FURTHER AUTHORIZING DISTRICT OFFICERS TO ENTER INTO A LOAN REPAYMENT AGREEMENT WITH THE WATER INFRASTRUCTURE FINANCE AUTHORITY FOR THE DEBT OF $3,002,461.00 ALL IN ACCORD WITH .. THE PROVISIONS AND POWERS SET FORTH IN ARIZONA REVISED STATUTES TITLES 48 AND 49 REGARDING SPECIAL TAXING DISTRICTS AND THE WATER INFRASTRUCTURE FINANCE AUTHORITY) )District Counsel Kay Bigelow briefed the board on the item.She stated Resolution No.2006-003 and Resolution No.2006-004 work together to get the Water Infrastructure Finance Authority (WIFA)loan.WIFA requires that i t have the ability to have the same access that the bond company has to the district's revenue if something goes wrong with the loan.They require parity with the bond.The indenture agreement had to be altered,which is what occurs in Resolution No.2006-003. It recognizes the WIFA loan and recognizes that it would have equal footing on getting to the revenues of the water district if it came down to a situation where there was not enough money to pay everybody.In Resolution No.2006- 004,the loan document is being approved.The loan agreement refinances Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 3 of 8 $2,000,000 from a previous WIFA loan and 800,000 plus in new money to pay for the arsenic treatment system.It also has provisions to give parity. Mr.Dietz asked if WIFA required the first resolution in order to get the monies in the second resolution. District Counsel Kay Bigelow stated that is correct.There is an outstanding WIFA loan at this point,but through a series of no one looking into it,it did not have parity.They are making the district refinance that as well as get the money for the arsenic treatment system.It is the WIFA loan that is requiring the changes in the indenture agreement as well as agreeing to the WIFA loan documents. Vice Chairperson Eck asked if she foresees any problems as far as the new money:whether it will cause a rate increase or if the development fee will help with i t insofar as the connection fee District Operations Manager Brian Hall stated for the short term construction of this they do not see a rate increase coming from this.As they look at the feasibility study,they are considering stepping that up into a rate study because i t looks like they may feel a pinch down the road,not from repayment of this loan,but from the additional operational and maintenance costs. Vice Chairperson Eck asked how they are going to do,on that with this. District Operations Manage Brian Hall stated they are.dOing just fine for the short term.The feasibility study identified that they needed to look at their -rates in general.Their consumption rate has been high'and other cities are catching up with us.The. board Was enthused that the rates had not been raised since the district's , inception,but they also need to look at the fixed cost of operating the system.They would be okay paying the capital back,but they need to look at long term for the future. ,District Finance Manager John White stated.the district has close to $5,000,000 in its regular bond indebtedness.. The WIFA loan that already exists is about $2:2 million:an additional $800,000 on top of that,percentage -wise,is not that much.But they -will Water Utilities Community Facilities District Meeting Minutes of February 21,2006 . Page 4 of 8 need to look at the overall picture in the not too distant future because of all the upcoming capital needs that will be necessary. Vice Chairperson Eck commented arsenic will hit everY end user eventually,and he is curious as to when. Chairperson Coleman closed the discussion with no further comments and called for a motion. Mr.Dietz MOVED THAT RESOLUTION NO. 2006-003,A RESOLUTION OF THE BOARD OF DIRECTORS OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION,ARIZONA)AUTHORIZING THE AMENDMENT OF THE INDENTURE FOR THE SERIES 1997A BONDS,BE APPROVED. Mr.Severs SECONDED THE MOTION. VOTE:Unanimous. The motion carried. Mr.Waldron MOVED.THAT.RESOLUTION NO.2006-004,A RESOLUTION OF THE. BOARD OF DIRECTORS OF THE:WATER UTILITIES COMMUNTIY FACILITIES DISTRICT (CITY OF. APACHE JUNCTION,ARIZONA)REVOKING RESOLUTION NO.2004-005 AND SUBSTITUTING INSTANT RESOLUTION :AUTHORIZING THE INCURRENCEOF DEBT IN -AN AMOUNT -NOT TO EXCEED $3,002,461.00TOR WATER -RELATED PROJECTS AND THE. REFINANCNG OF THE 2001 WATER INFRASTRUCTURE FINANCE AUTHORITY ("WIFA")LOAN;AND FURTHER AUTHORIZING: DISTRICT OFFICERS TO ENTER INTO A LOAN REPAYMENT AGREEMENT WITH THE WATER INFRASTRUCTURE FINANCE AUTHORITY FOR THE DEBT OF $3,002,461.00_ALL-IN ACCORD WITH THE PROVISIONS AND .POWERS SET FORTH IN ARIZONA REVISED STATUTES TITLES 48 AND 49 REGARDING SPECIAL TAXING DISTRICTS AND THE WATER INFRASTRUCTURE FINANCE AUTHORITY,BE APPROVED. Mr.DietzSECONDED MOTION. VOTE:Unanimous-. The motion carried. DISTRICT OPERATIONS MANAGER REPORT Water Utilities Community Facilities District Meeting Minutes of February 21,2006. Page 5 of 8 District Operations Manager Brian Hall stated the arsenic treatment on Well No.6 is well under way.They had some equipment failures in the last couple of months and the contractor has ordered additional parts and changed out some parts.He has been told by the Arizona Department of Environmental Quality that the district is doing alright.The district has until the end of the quarter to meet the new arsenic standard and pull a sample that is reportable. As long as the district is making water better than what i t used to make,they are not requiring the district to meet the standard during this tuning period. The last time he checked they were in the upper 20's,which is better,but they are not there yet.The president of Filtronics is coming tomorrow afternoon to tour the process to see what needs to be tweaked.There was some difficulty with the break in period of the filter media and other things which prevented them from jumping right into the five parts water.They are confident it will happen and the contract with the general contractor that states it will happen.They still have some time to work it through.A crew has reconnected pipes to Well No.5.The pump is in the hole and the motor is on top of the wellhead,the manifold is in and they are doing the underground piping.That should be finished tomorrow.They will also work on conduits for motor leads and begin waiting for Arizona Department of Environmental Quality approval on source water.They have not had the final lab results on arsenic on that well.They are assuming,since i t is 65'from the old well hole,that the water quality will be similar to the old well.The water quantity was on target with what they expected.The current pump setting will get the 750 gallons per minute that they were getting in the old hole;if they set the pump 100'deeper they could get 900 gallons per minute.There is additional capacity in that well even though the static level of the water is substantially lower than it was ln 1972.when the well was initially drilled. They hope the well will be up and running by the end of the week:they will chlorinate,disinfect the well and pull bacterial samples.As soon as they have approval,the well will be back on line.They are hoping the approval will come next week.If Well No.5 comes back on line next week,they can cease to use the temporary treatment facility at the end of the month of February,which will save that expense in March.It has worked well and he will come back to them with a final report on how it did,what it cost and the possibilities for the future.The Well No.8 construction is the project that is the farthest out.He does not anticipate the completion of the well until the end of March.They are having trouble getting power scheduled from Salt River Project.However,i t is a fairly small quantity of water compared to the other water resources.They were completing the block wall around i t Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 6 of 8 today and the building has been roughed in.They are working on the wiring and the pump controls.The pump is in the hole and is pumped and wired. DISTRICT MANAGER REPORT District Manager George Hoffman thanked the men in the field and District Operations Manager Brian Hall as they have been working 20 hour coverage to get some of the facilities up to speed.He asked that others say thanks to the district personnel if they see them so that they know that someone knows what they have been going through to keep the water coming out of the faucet. DISTRICT TREASURER REPORT District Finance Manager John White stated he is paying the checks that the District Operations Manager is requesting for all the heavy contracts. DISTRICT COUNSEL REPORT District Counsel Kay Bigelow stated they will be discussing the acquisition of Arizona State Land trust property for the Ironwood Drive project in the executive session.She commented a couple of months ago one of the contractors had not paid National Water Works,one of their suppliers.They sued the district,and the district has settled that for the amount that the district was retaining to pay the contractor.The district is not out any extra money or anything else.The request for dismissal went in through the plaintiff's attorney last week and she is expecting a final dismissal soon. MOTION FOR EXECUTIVE SESSION )Chairperson Coleman called for a motion. Mr.Dietz MOVED THAT AN EXECUTIVE SESSION BE HELD AT 6:20 P.M.ON TUESDAY,FEBRUARY 21,2006,IN THE CITY COUNCIL CONFERENCE ROOM FOR THE PURPOSE OF CONSULTATION FOR LEGAL ADVICE WITH THE DISTRICT'S ATTORNEY IN ACCORDANCE WITH A.R.S.§ 38-431.03(A)(3),(4)AND (7)AS FURTHER OUTLINED ON THIS AGENDA,BE APPROVED. Mr.Waldron SECONDED THE MOTION. VOTE:Unanimous. Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 7 of 8 The motion carried. ADJOURNMENT meeting at 6:20 p.m. )Chairperson Coleman adjourned the ACCEPTED THIS 21ST DAY OF MARCH ,2006,BY THE CHAIRPERSON AND DISTRICT BOARD OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY),CITY OF APACHE JUNCTION,ARIZONA. SIGNED AND ATTESTED TO THIS 21ST DAY OF MARCH ,2006. ATTEST: Kathleen Connelly District Clerk AF "2 -1 4 Douglas Coleman Chairperson WATER UTILITIES COMMUNITY FACILITIES DISTRICT MINUTES CERTIFICATION I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the regular meeting of the Water Utilities Community Facilities District of the City of Apache Junction.Arizona,held on the 21st day of February,2006.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 23rd day of February,2006. Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of February 21,2006 Page 8 of 8