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HomeMy WebLinkAbout2010-11-16 WUCFD MINUTESWATER UTILITIES COMMUNITY FACILITIES DISTRICT (APACHE JUNCTION WATER COMPANY) CITY OF APACHE JUNCTION, ARIZONA REGULAR MEETING NOVEMBER 16, 2010 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 November 16, 2010, 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 Insalaco Vice Chairperson Dietz Mrs. Robin Barker Mr. Douglas Coleman Mr. R.E. Eck Mr. Jeff Serdy Mr. Chip Wilson Staff Present:George Hoffman, District Manager Kathleen Connelly, District Clerk Frank Blanco, District Director John White, District Finance Manager Kay Bigelow, District Legal Counsel Giao Pham, District Engineer David Fern, Utility Director Donna Meinerts, District Finance Dir. Others Present:Bryant Powell, Assistant City Manager Hazel Randall, Administrative Assistant APPROVAL OF MINUTES OF OCTOBER 19, 2010 Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 1 of 14 )Vice Chairperson Dietz MOVED THAT THE MINUTES OF OCTOBER 19, 2010, BE APPROVED. Mr. Eck SECONDED THE MOTION. VOTE:Unanimous. The motion carried. PROPOSED AGREEMENT WITH CENTRAL ARIZONA COLLEGE FOR ITS PARTICIPATION IN COST OF WATER LINE REPLACEMENT District Manager Frank Blanco briefed the board on the item.He stated the location is Broadway Road between Idaho and Winchester.The project is replacing an existing 6" ACP line with a 12" ductile iron pipeline.It is of mutual benefit to both the district and the college.The cost participation is 50% for each.It will give additional volume on the line on Broadway, with the intent to abandon the 6" already in place and build a new 12" ductile iron pipeline.In the future they will connect the 12" line to an existing line going north and south on Winchester which will be replaced with an 8" line.The 5 year capital improvement plan included upgrading the 6" line surrounding Central Arizona College.City, water district and college staff met together to identify the requirements.It is a fast track project.They have 90% of the plans plus the agreement before them.The college's obligations are to develop engineering plans due by January 1, 2011 and to construct a 12" water line by December 1, 2011.It will more likely be sooner than that.The district obligations are to pay 50% of the engineering and construction costs, not to exceed $90,000.Instead of hiring an engineer and getting bids for construction of the pipeline, they piggybacked on the college's existing project.It saves time and money and provides an opportunity to partner with Central Arizona College. Vice Chairperson Dietz commented they upgraded to a 12" line all the way down Broadway but stopped it at Idaho. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 2 of 14 District Director Frank Blanco stated that is correct. Vice Chairperson Dietz commented they will just be tying into it and taking it to Winchester. District Director Frank Blanco stated that is correct. Mr. Eck commented going up to an 8" is the minimum they need for fire hydrant protection. District Director Frank Blanco stated that is correct.It is related to fire flows.It is substandard as it exists today. Chairperson Insalaco closed the discussion and called for a motion. Mr. Coleman MOVED THAT THE PROPOSED AGREEMENT WITH CENTRAL ARIZONA COLLEGE FOR ITS PARTICIPATION IN COST OF WATER LINE REPLACEMENT BE APPROVED AND THAT THE BOARD CHAIR OR VICE CHAIR BE AUTHORIZED TO SIGN THIS AGREEMENT SUBJECT TO FINAL APPROVAL AS TO FORM BY DISTRICT LEGAL COUNSEL. Mrs. Barker SECONDED THE MOTION. VOTE:Unanimous The motion carried. PURCHASE OF. ONE FORD F250, ONE FORD RANGER AND.ONE FORD ESCAPE HYBRID FROM STATE CONTRACT NO. P7B/SCC07008-2 )District Director Frank Blanco briefed the board on the item.He stated they would be replacing two older vehicles.Public Works helped them out with Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 3 of 14 the procurement process, going directly to the state contract. They were not successful with bids on the open market. Mr. Eck asked if the older vehicles would be saved and auctioned off. District Director Frank Blanco stated that is the intention. Vice Chairperson Dietz asked if they got a bid from the local Ford dealership. Utility Director David Fern stated they typically go through the state contract when they award vehicles. Vice Chairperson Dietz commented they just went through this at the city.He was wondering with this bid how close they came or if they even bid on the vehicles. Utility Director David Fern commented with the economy the way it is right now, they tried to go out for low bids to see if they could give the local vendors a better opportunity to bid our vehicles.They found out that the pricing on the state contract is so good that the competition is not really that great.They tried it a couple of times just to make sure but it turned out the local vendors could not compete with the great pricing on the state contract. Vice Chairperson Dietz asked if we got a bid from a local vendor. Utility Director David Fern stated in order for the local vendors to be asked for a bid they have to be on the state contracts.The local vendors were not available to quote because they were not on the state contract. Vice Chairperson Dietz asked if they received something after they went through this the last time about where we looked at the whole benefit.There was a way it could be done. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 4 of 14 District Clerk Kathleen Connelly stated they talked about it. Mr. Eck commented they received something about it but it did not reduce it dramatically. Utility Director David Fern stated the city attorney did look into some type of local bid preference.What he found out is that there are Arizona statutes that make it difficult to do that and not violate the state statutes. Vice Chairperson Dietz stated they were so close last time; they were just within $1,500 or so.With the tax the city would have received with it being purchased in the city, it actually brought that bid in lower than the Five Star lowest bid last time. Utility Director David Fern stated they were not the low bidder last time, but if they had done a local preference they would have been. Mrs. Barker asked if the hybrid is the beginning of a green fleet. Utility Director David Fern stated it hopefully is.It is a good start.It is a 4 cylinder hybrid so the gas mileage will be really good. Mr. Eck commented they should go with the philosophy that they should always go local first if possible, and if they cannot, something like this state contract that is better is where they would have to go.It should be our goal that if they can get a local bid they should try to, and it is up to them if they can have the lowest bid.They made the effort of trying to go local. District Manager George Hoffman stated that is a good common sense approach.The challenge is that it is a bunch of staff time to bid the thing. The local bidding is not free.We are running lean staff. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 5 of 14 Mr. Eck commented he does not understand if they are just asking for a bid. District Manager George Hoffman stated they need to talk about what is in the bid specifications. Utility Director David Fern stated they checked the resource time that it takes to put the solicitation together.You have to put the bid documents together to make it a fair and competitive bid, plus the time it takes to present and prepare for council.The ballpark number that they estimated that it takes to prepare a solicitation is about $2,000 per solicitation.Unless we get a solicitation that is $2,000 less than the state contract, it is a lost opportunity/cost resource issue. District Manager George Hoffman commented if they could get their counterpart to get their city attorney to do a best value, he believes that is the concept.He asked the district clerk to confirm that. District Clerk Kathleen Connelly stated that is what she found in the Tucson code. Vice Chairperson Dietz commented he thought they had gotten a memo on the best value deal. District Manager George Hoffman commented if they could emulate that model, there are a lot of benefits to buying locally.Staff wants to buy locally. The problem is they also try to be frugal.Twice they have gone out and expended taxpayer dollars over here trying to save in the purchase price over here and did not achieve that. Vice Chairperson Dietz asked what the difference is from here to where the last time we purchased five vehicles.It was just a month or two ago.With that one it went out to bid and he believed they used the state contract for that one, also. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 6 of 14 Chairperson Insalaco stated it went out to bid but it was all state contract. Utility Director David Fern stated they went out to public bid for the vehicles for the police department with the Crown Victorias. Vice Chairperson Dietz commented there were five vehicles for the police department and public works. Utility Director David Fern stated that is correct.The pricing actually, when they went through the state contract this time, they got for $5,000 less than the state contract value because of some of the work by our fleet group to try to reduce the engine size. Mr. Eck commented he is only getting at is that the public perception is we do try to buy locally.They will all be getting asked why they did not buy locally.He does.People will want to know why they did not buy these vehicles locally and they will have to tell them that they got them cheaper someplace else. Utility Director David Fern commented that question could be answered by saying they need the city attorney to develop some type of local bid preference. Mr. Eck commented they have to come up .with the low bid.When they can go out local., they should. know.And they do know.They had to have known the last time they bid and they did not bid quite low enough.It should be our philosophy that if we can use local and they meet the criteria, but if they are looking at what we are posting they are going to do that. Utility Director David Fern stated another option is to get them to competitively go after getting under the state contract. Mrs. Barker stated it seems like that would be .the most cost effective, too. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 7 of 14 Mr. Eck asked if they can legally tell the local dealers that it might work if they are on the state contract. District Legal Counsel Kay Bigelow stated they cannot have an institutionalized local bidder preference.There is case law on that.They can consider the amount of taxes they are getting off that as part of taking if off the price.She believes David was saying the car dealerships were not giving something that was even close to just taking the sales tax off and then adding the cost of the staff time and value, that it was not competitive. Vice Chairperson Dietz commented the last time they went out for the five vehicles, if they would have considered the overall value, he thinks they were coming out a few thousand dollars cheaper if they would have gone local. District Legal Counsel Kay Bigelow stated it is always lowest responsible bidder.The word responsible has qualitative things that are embedded in that. The question is -what is qualitative, such .as having these guys go down the block versus going to the other side of Phoenix has some quality to it.How much is unsure-.They do not want to be ridiculous about it, but they could probably support that. Mr. Eck commented he thinks they are doing what they are supposed to be doing.He would just like the information for when someone catches him and says something then he has the information.He thinks they are fine and he believes he got them off track. Vice Chairperson Dietz commented shop local. Mr. Eck agreed and commented end of story. Chairperson Insalaco closed the discussion with no further comments and called for a motion. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page :8 of 114 Mr. Eck MOVED THAT THE PURCHASE OF ONE FORD F250, ONE FORD RANGER AND ONE FORD ESCAPE HYBRID FROM STATE CONTRACT NO. P7B/SCC070008-2 FOR A TOTAL AMOUNT NOT TO EXCEED $74,779.71 INCLUDING TAX TO REPLACE THREE EXISTING VEHICLES BE APPROVED. Mrs. Barker SECONDED THE MOTION. VOTE:Unanimous. The motion carried. RESOLUTION NO. 2010-009, AUTHORIZING THE BOARD TO APPLY TO THE WATER INFRASTRUCTURE FINANCE AUTHORITY OF ARIZONA FOR TECHNICAL ASSISTANCE GRANT FUNDING )District Legal Counsel Kay Bigelow briefed the board on the item.She stated they are required to have a formal resolution to apply for a technical assistance grant with the Water Infrastructure Finance Authority. Mrs. Barker asked what the technical assistance grant is for. District Director Frank Blanco stated the grant is for a Supervisory Control and Data Acquisition system.It is in the five year plan.The intent is to get technical assistance to design and plan the project.It is a $53,000 project with $21,000 covered by the water district and $31,800 covered by the Water Infrastructure Finance Authority.It is a matching grant.Much of the money from the water district is staff time for research and the gathering of information for the consultants. Chairperson Insalaco closed the discussion with no further comments and called for a motion. Mrs. Barker MOVED THAT RESOLUTION NO. 2010-009, A RESOLUTION OF THE BOARD OF DIRECTORS Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 9 of 14 OF THE WATER UTILITIES COMMUNITY FACILITIES DISTRICT (CITY OF APACHE JUNCTION, ARIZONA) AUTHORIZING THE BOARD OF DIRECTORS TO APPLY TO THE WATER INFRASTRUCTURE FINANCE AUTHORITY (WIFA) FOR TECHNICAL ASSISTANCE GRANT FUNDING BE APPROVED. Vice Chairperson Dietz SECONDED THE MOTION. VOTE:Unanimous. The motion carried. DISTRICT MANAGER REPORT None. DISTRICT DIRECTOR REPORT District Director Frank Blanco stated he was on the phone with the General Services Administration regarding the federal land that is along Houston Road for the future water treatment plant. It has gone back to the Bureau of Reclamation.The value of the property is over $60,000 so they are deliberating on whether they can do a directly negotiated sale at this point or go back out and auction the parcel.He will hear back from them next week.The process has taken over 2 years thus far.He is keeping in contact with them, letting them know the district is still interested in that parcel. Vice Chairperson Dietz asked if this is the one Pinal County is supposed to be taking care of. District Director Frank Blanco stated that is correct. Vice Chairperson Dietz commented the district is doing all the leg work on it. District Legal Counsel Kay Bigelow stated the district is the applicant because it was done before the agreement was put in place.The district was afraid if the entities were switched it would not have control over it or that it would be delayed.The district therefore kept in control of it. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 10 of 14 Vice Chairperson Dietz asked what the problem is with the $60,000 price tag. District Director Frank Blanco stated according to federal regulations, if the value exceeds $60,000, which it does, than the Bureau of Reclamation could require that the parcel be auctioned.We would have a similar situation that the Pinal County people went through and they would have to be the high bidder for acquiring the parcel.The bad thing is that it takes more time.In terms of taking additional time, they currently meet the demands for that facility so it is not hurting the district directly today.We have the capacity through the interconnect at Baseline. Vice Chairperson Dietz stated he understood but it irritates him to no end that we have to do all this and spend our staff time when Pinal County should be all over it.It should have been done by now and here we are still talking about it. Chairperson Insalaco stated it irritates them all. District Director Frank Blanco stated the next thing is the sludge removal bid.The excess water from Well #6 is not drying out in time and we have lots of decant water that is virtually clean water that must be hauled off.It is very expensive. They are going out for bid and they will have a consultant reprogram the process for dewatering in order to recover more of the clean water instead of having to haul it off.Sludge disposal avoids violations of the Clean Water Act; there would be very high fines if we got into a situation where it ran over into a wash.They need the sludge disposal contract and they need to reprogram the facility. Mr. Eck asked if it could be put into the waste. District Director Frank Blanco stated they cannot because it contains a byproduct of the arsenic removal process.It contains ferric chloride. Mr. Eck commented it is then deemed sludge water. District Director Frank Blanco stated that is correct. Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 11 of 14 Vice Chairperson Dietz asked if they could get recharge credit for this. District Director Frank Blanco stated some of the water that is hauled off can go to the wastewater treatment facility.The sewer district will treat that water and actually do some recharge, and then sell the water district the credit.It is very costly and inefficient for us to do that. Mrs. Barker commented we approve them to haul it and then have to buy it back. District Director Frank Blanco stated that is correct. Mrs. Barker asked if an open water area like this can create a mosquito problem. District Director Frank Blanco stated it does not.They have. not seen that problem.They try not to accumulate the water for that long a period, but the quail look healthy out there.They will be asking for approval to award a contract for sludge removal in theE future.He commented on various news articles regarding water scarcity in the Southwest.He commented on a Nevada water resource employee suggesting tapping groundwater using a 720 mile:pipeline under cattle=ranches and diverting Mississippi River water to Las Vegas.According to Central Arizona Project, the drought continues*ere.-2000 to 2010:have been the driest years on record.LakePowell is 63% full, Lake Mead is 39% and the -total storage on the Colorado River Basin is 55%.Last year atthis time it was 57%.This affects our municipal and industrial water and our future lease water.The Colorado River 2011 forecast is normal water supply, with over 90% probability of,normal water supply in 2012.If there is -a shortage it will first occur in 2013, with less than a 35% probability of a shortage in the next 5 years, for 15-25 years: there will be no shortage to Central Arizona Project municipal and ,industrial water and Indian priority water.When shortages do -occur, the last ones cut mould be the municipal, industrial' and Indian water., Chairperson Insalaco commented a year -ago -or so a member of the Army -Corps of Engineers wasthinking about putting a canal Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 12 of 14 alongside 1-40 with floodgates at the Mississippi River.It seems farfetched, but it makes a lot of sense.Instead of flooding everyone down south, open the gate and let the water come west.You would think with all the money getting spent that someone would get smart and do something like this. Mr. Eck stated it is similar to the Central Arizona Project.It moves water all across Arizona. District Director Frank Blanco stated it took a lot of money. Mr. Eck commented it took some effort out of professional minds. Chairperson Insalaco commented when he heard what he was saying, he remembered that he had heard about it a couple of years ago. District Director Frank Blanco commented they have said if there is no shortage of money there is no shortage of water.The water master plan is a large document available at the chairperson's desk if they wish to go through it.It includes infOrmation on water quality, demands, resources, water infrastructure for producing and distributing water, costs, and capital improvement plans.There is an executive summary if they do not want to'read..the whole thing-.There are recommendations at the end.They will use it for the next 10 years.The 5 year capital improvement plan is derived from the master plan with the last 5 years derived:from -iecommendations in the 'document and other new recommendations :that come along. The final recommendations were to approve the 5 -year capital improvement plan, to not approve a blank check for projects in the plan but to come back to the board on an individual basis, additional Central Arizona ,Project water, ,work -towards an 80% Central Arizona Project water usage and 20% groundwater use, Portalis providing an energy plant, non -revenue -water study, feasibility study ofIviesa water treatment plant, water quality modeling study, and a new water treatment plant. DISTRICT TREASURER REPORT None. DISTRICT LEGAL COUNSEL REPORT Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 13 of 14 None. ADJOURNMENT ) Chairperson Insalaco adjourned the meeting at 6:30 p.m. ACCEPTED THIS 7TH DAY OF DECEMBER , 2010, 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 7TH DAY OF DECEMBER 2010. 0.4koLia_a_eo- hn 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 16th day of November, 2010.I further certify that the meeting was duly called and held and that a quorum was present. Dated this 19th day of November, 2010. Kathleen Connelly District Clerk Water Utilities Community Facilities District Meeting Minutes of November 16, 2010 Page 14 of 14