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HomeMy WebLinkAbout2009-03-03 WUCFD MINUTESWATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY) CITY OF APACHE JUNCTION, ARIZONA REGULAR MEETING MARCH 3, 2009 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 March 3, 2009, at the Apache Junction City Council Chambers pursuant to the notice required by law. CALL TO ORDER Chairperson Insalaco called the meeting to order at 6:00 p.m. ROLL CALL Board Members Present:Chairperson John Insalaco Mrs. Robin Barker Mr. Douglas Coleman Mr. Rick Dietz Mr. Jeff Serdy Mr. Chip Wilson Staff Present: Others Present: (Vice Chairperson R.E. Eck was absent.) George Hoffman, District Manager Kathleen Connelly, District Clerk Frank Blanco, Water District Director David Fern, Utility Director Giao Pham, District Engineer Kay Bigelow, District Counsel John White, District Finance Manager Donna Meinerts, District Finance Dir. Bryant Powell, Assistant City Manager Hazel Randall, District Admin. Asst. Liz Riley, Human Resources Director APPROVAL OF MINUTES OF FEBRUARY 3, 2009 ) Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 1 of 10 )Chairperson Insalaco called for a motion. Mr. Dietz MOVED THAT THE MINUTES OF FEBRUARY 3, 2009, BE APPROVED. Mrs. Barker SECONDED THE MOTION. VOTE:Unanimous. The motion carried. AWARD OF BID FOR CONSTRUCTION OF MESA INTERCONNECT WATER TRANSMISSION MAIN AND BOOSTER PUMP STATION PROJECT Blanco briefed the board on the item. District Director Frank Mrs. Barker asked what the difference is between the estimated $3 million and the bid of $2.2 million.She wanted to know if they left something out or if it is good economic conditions for this now. District Director Frank Blanco stated they are getting good prices on steel construction projects. District Engineer Giao Pham stated it is basically the economy and some of the prices have gone down due to the fluctuation in fuel prices.They are seeing a more favorable pricing to construction projects as a result. quality is still the same. stated it is. $600,000 difference is awesome. Mrs. Barker asked if the District Engineer Giao Pham Mr. Dietz commented a Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 2 of 10 District Manager George Hoffman asked Giao and Frank to address the issue of change orders. They have been reading about some companies low bidding and then change ordering themselves back to profitability. District Engineer Gaio Pham stated when they have the lower bids, they meet with staff and look at the references from the general contractors and other cities.They follow up on the references to determine the number of complaints in order to deem the bid unresponsive.It takes a lot of time to pay attention to what has been done in the past, such as the recommendation from the City of Phoenix, Chandler or other municipalities they have worked with in the past.For the most part, there were no complaints with B & F. The district will also be looking at inspector services as a water line is different from a roadway project.There are more requirements from Arizona Department of Environmental Quality for pressurizing the line.They need someone that has that type of construction management.They will bring that to the board in the next couple of weeks. Assistant City Manager Bryant Powell asked if the 10% for change orders will be enough. District Engineer Giao Pham stated it should be. Chairperson Insalaco closed the discussion and called for a motion. District Counsel Kay Bigelow read off a new motion that had not been included in the packet. The contingency is for unforeseen things, not just for change orders.Staff will make sure that they did not know that when they made the bid, otherwise it is not a valid change order. Mrs. Barker MOVED THAT THE AWARD OF BID FOR THE CONSTRUCTION OF MESA INTERCONNECT WATER TRANSMISSION MAIN AND BOOSTER PUMP STATION BE AWARDED TO B & F CONTRACTING, INCORPORATED IN THE AMOUNT OF $2,203,726.50 BE APPROVED, SUBJECT TO FINAL APPROVAL BY LEGAL COUNSEL AND THAT THE BOARD CHAIR OR VICE CHAIR BE AUTHORIZED TO SIGN THIS Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 3 of 10 AGREEMENT AND ALLOW FOR A 10% CONTINGENCY IN THE AMOUNT OF $220,372.65 AT THE DISCRETION OF THE DISTRICT DIRECTOR. Mr. Dietz SECONDED THE MOTION. VOTE:Unanimous. The motion carried. PGS & J PROFESSIONAL SERVICES AGREEMENT FOR PROPOSED WATER TREATMENT PLANT SITE ALTERNATIVES ) )District Director Frank Blanco briefed the board on the item. Mr. Dietz asked if it would go to the water district from Pinal County. District Director Frank Blanco stated that is correct. Mr. Dietz commented that regardless of which one was selected, if they selected their number one choice and it was more expensive to do, then Pinal County would pay the difference of whatever it would have been. District Counsel Kay Bigelow stated it will put the district at a net zero cost. Chairperson Insalaco closed the discussion and called for a motion. Mr. Coleman MOVED THAT THE PBS & J PROFESSIONAL SERVICES AGREEMENT FOR PROPOSED WATER TREATMENT PLANT SITE ALTERNATIVES BE APPROVED SUBJECT TO FINAL APPROVAL BY LEGAL COUNSEL AND THAT THE BOARD CHAIR OR VICE CHAIR BE AUTHORIZED TO SIGN THIS AGREEMENT. Mrs. Barker SECONDED THE MOTION. VOTE:Unanimous. Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 4 of 10 The motion carried. PROPOSED LEGISLATION FOR NEW FEE FROM CENTRAL ARIZONA GROUNDWATER REPLENISHMENT DISTRICT (CAGRD) TO ESTABLISH REVENUE FOR BONDING )District Counsel Kay Bigelow briefed the board on the item. Mr. Dietz asked what the percentage is if they want to go from $250 million to $500 million in bonds.He asked how they could determine how much Apache Junction Water owes them. District Counsel Kay Bigelow stated there is a set amount per acre foot that the district will pay.Everybody in the Phoenix AMA will pay that same amount.They pay a certain amount based on acre foot if you are a designated provider. Mr. Dietz asked what that amount is. District Counsel Kay Bigelow stated it is $5.38 per acre foot in the member service area. Mr. Dietz commented Lost Dutchman Heights is looking at 14,000 acre feet. District Counsel Kay Bigelow stated that is based on a certain amount.It depends on the amount as to how much they are looking to finance.That number is not good for any amount.The amount that they can finance is based on it being at least a third of the annual membership dues.It would depend on the number of membership areas, how much they have given a check for, and how much they have to complete; the number is not discreet.It is not a certain number. Mr. Dietz commented that they do not have a ballpark number. Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 5 of 10 District Counsel Kay Bigelow stated she should figure that out and send them an email. Mr. Dietz commented it would be good to have that. District Counsel Kay Bigelow stated it is much lower than the acre foot of water that the district is paying for and the amount of charge that the Central Arizona Groundwater Replenishment District charges the district when it services the district.Right now the fee is zero and it will go an amount that the district will pay whether it is having replenishment done or not. Mr. Dietz commented it is going to get a lot more costly to provide water. District Counsel Kay Bigelow stated it is something they will have to figure out in their rate or they will have to tell the developer that they will have to provide the money for that. Mr. Dietz stated they have to have that set of figures, especially with things starting to go south of the city.They need to know how to proceed. Mrs. Barker asked if this will be an annual membership or a lifetime membership, and if it is annual, will it accumulate that the district has paid "x" amount of dollars and when they do use the water out of what has been replenished, will they take it out of what has already been paid. District Counsel Kay Bigelow stated once it is paid it is gone.It goes out and buys renewable resources that they can use to replenish. Mrs. Barker commented it does not credit the account in any way, shape or form. District Counsel Kay Bigelow stated it does not.It is an annual fee and they will be able to figure out how much they have to go out and secure renewable Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 6 of 10 resources, such as buying excess Central Arizona Project water from somebody, buying effluence from somebody to do recharge, or do a recharge or replenishment site and use what an irrigation district is not using of their Central Arizona Project water. Those are the things that they want money for.They want to know whether the district is paying them for water they are replenishing or not, that they can go out and finance it. Mr. Dietz commented that the district does get credit for what replenishment the district has secured for itself up to this point. District Counsel Kay Bigelow stated they pay the Central Arizona Groundwater Replenishment District to replenish 96% of the groundwater that the district uses.Other than what they get the effluent sewer district credit for, they use more than 4% groundwater.They therefore pay Central Arizona Groundwater Replenishment District at the end of the year a replenishment fee that is for the Central Arizona Project water that they use at a certain rate, one hundred dollars something per acre foot, and an administrative charge for them to do that for the district.The district director gets the bill for that.The recharge credits mean that they did not replenish as much water for the district. Mr. Dietz commented they have so many recharge credits at this time and have been building them up for some time.They should get credit for that instead of paying for replenishment. District Counsel Kay Bigelow stated as long as they use the recharge credits and cash them in, they will get credit for them.If they do not use them and continue to build them up for another day, then they do not get credit for them until they use them. Mr. Dietz commented he just wanted to make sure that when they use them they would get credit for Them.Otherwise, they have been purchasing the recharge credits for no reason. District Counsel Kay Bigelow stated they are absolutely valuable and a wise investment.They Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 7 of 10 have hopefully been purchasing them at a lower price than what you will pay the replenishment district.That saves the district money when they cash them in. Mr. Wilson asked if they could pass on the fee to developers before they actually do the construction. District Counsel Kay Bigelow stated it is all a matter of negotiation.Oftentimes, when they look at paying for growth, they need to pay for growth even if they do not have a customer to pass it on to.In the development agreement with them, they need to come up with a way that if they want the certainty of having water there when they get there, that they will pay the per acre foot charge to hold that or commit that water from the Central Arizona Groundwater Replenishment District.It is all a matter of negotiations and it is perfectly legal to do that.If they want the developer to pay it, it can be an issue in negotiations. Mr. Coleman asked if it is a geographical area that they cover or is it just people that sign up with them as members. District Counsel Kay Bigelow stated there are two ways to be a member of the district.For the district, we are a member service area.The district has signed on with them to be a member.The district, which is formed as a governmental entity and does not have any real citizens in it, is responsible to the Central Arizona Groundwater Replenishment District and receives the benefits from the Central Arizona Groundwater Replenishment District. Arizona Water is not a designated provider.They are part of the membership through the land becoming encumbered with an agreement with the Central Arizona Groundwater Replenishment District who will provide the replenishment obligations.They get billed for it on their tax bill.It is a line item on their tax bill through the county treasurer.The district customers do not see it as a line item; they just see what their rate is. District Director Frank Blanco stated when they talk about district boundaries, they are Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 8 of 10 talking about the three counties that the Central Arizona Groundwater Replenishment District serves. Mr. Coleman commented that would be Maricopa, Pinal and Pima. District Director Frank Blanco stated that is correct. Chairperson Insalaco closed the discussion with no more comments and moved on to the next item. DISTRICT MANAGER REPORT None. DISTRICT DIRECTOR REPORT None. DISTRICT TREASURER REPORT None. DISTRICT LEGAL COUNSEL REPORT None. ADJOURNMENT adjourned the meeting at 6:25 p.m. ) Chairperson Insalaco ACCEPTED THIS 17TH DAY OF MARCH , 2009, 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 2009. 1711:1 DAY OF Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 9 of 10 MARCI-L John S. Insalaco Chairperson ATTEST: Kathleen Connelly District Clerk 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 3rd day of March, 2009.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 10th day of March, 2009. Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of March 3, 2009 Page 10 of 10