MINUTES OF MEETING
††††††††††† The regular meeting of the Board of
Supervisors of the Coral Springs Improvement District was held
††††††††††† Present and constituting a quorum were:
††††††††††† Robert D. Fennell†††††††††††††††††††††††††††††††† President
††††††††††† Karl Miller††††††††††††††††††††††††††††††††††††††††††††† Vice President
††††††††††† Bill Eissler††††††††††††††††††††††††††††††††††††††††††††† Secretary
††††††††††† Also present were:
††††††††††† Rhonda K. Archer†††††††††††††††††††††††††††††††† Finance Director
††††††††††† Donna Holiday††††††††††††††††††††††††††††††††††††† Recording Secretary
††††††††††† Hal Anderson†††††††††††††††††††††††††††††††††††††††† Attorney
††††††††††† Roger Moore†††††††††††††††††††††††††††††††††††††††††† Engineer
††††††††††† Mr. Fennell called the meeting to order and Ms. Archer called the roll.
ORDER OF BUSINESS†††††††† Approval of the
Minutes of the
††††††††††† Mr. Fennell stated that each Board
member had received a copy of the minutes of the
††††††††††† There not being any,
THIRD ORDER OF BUSINESS††††††††††† Public Hearing to Consider the Adoption of the Water & Sewer Budget for Fiscal Year 2003
††††††††††† Ms. Archer stated everyone received a copy of the budget with the latest changes.† Page one of the summary budget shows projected revenues for the next fiscal year and also shows the adopted budget for this year and projected actual at year end.† We are quickly approaching build-out of our system.† We have a small amount of vacant parcels left in this District and as such we are going to start seeing a big reduction in our meter fees and connection fees which are one time charges to new connections to the system.† At the same time you will see that being at build-out we are at stabilization and our build-out revenues are going to be shown against our build-out expenditures and we will come to a point in time where we will have enough operators on board so that the revenues are supporting the expenditures and we are not going to have to have rate increases and even though Mr. Moyer has indicated that we may be able to reduce rates, we are spending a lot of money on renewal and replacement and I struggled a little bit when I put this budget together for personnel that I felt that we should hire such as operators and field personnel that we were not able to hire this year because of the upcoming costs so that we make our debt coverage required by our bonds.† We struggled keeping this budget as tight as we could without increasing rates and that is what is before you today, a budget that covers our expenditures for the next fiscal year with conservative revenues that we expect to receive and without increasing rates.
††††††††††† The debt service portion reflects the bonds as they are today before we do any refinancing.† Ms. Kiser called and will be here shortly for a presentation on the bond resolution later in the meeting so that we can move forward with the refunding of the bonds.† The interest rates are still very good and there will be a nice savings each year in this line item once we do the refinancing.† This budget does not reflect that refinancing today, this reflects the bonds as they stand right now and still we will meet our debt coverage requirements.†
††††††††††† We show a reduction in the
administrative portion of the budget and that is reflective of our historical
costs that we have been experiencing.†
Even though some of the personnel costs have gone up, we have done a
restructuring of the contract with Severn Trent for two of the employees
provided through Severn Trent versus employees on our payroll.† We decided to move two employees back onto
the CSID shared with North Springs payroll and that is our H.R. Director and
our Utility Billing Manager because the bulk of their time is spent in
††††††††††† We have also reduced legal fees based on the actual that we expect to incur this year and engineering fees.† Any legal and engineering costs involved in the bond refinancing will be paid out of the bond issue and not out of our operating expenses.†
††††††††††† There was a slight drop in the audit fees.† Accounting, finance and management contract has gone done significantly but that is made up for in personnel costs.†
††††††††††† We are experiencing a big increase in health insurance and general liability insurance.† Health insurance went up about 38% last year and they predict the same again this year.† We started looking at another company and we are going to make a change and make a change in some of the employee deductibles and things like that.† They are getting hurt because they carry dependent coverage as a payroll deduction and because those prices are going up so high, higher than their salaries are going up, it is a big out of pocket expense for them for dependent coverage.† We are trying to increase the deductibles to keep that dependent coverage reasonable and affordable for the employees.† This budget represents the worst-case scenario and we hope to bring it down lower than what is shown if we can successfully change to a new company.† The problem is when you change to a new company, you have good rates for a couple of years and then they go up again.†
††††††††††† The rest of the budget hasn't changed too much on the administrative side.† We project total expenditures of $592,942 against last year's $686,548 for administrative costs.†
††††††††††† Plant operations have gone up, most of that is related to personnel and the number of operators that we need to run the plant facilities that we have.† The maintenance costs have gone up a little bit because once the expansion is completed we need to provide preventative maintenance.† The other contractual includes additional costs related to the maintenance, sludge hauling projections, and chemical feed system.† Also provided in this budget that you haven't seen in the past are the security operations for the plant site.† That was the major jump in this budget.† I don't think we have seen the end of that.†
††††††††††† Mr. Miller stated we talked years ago about the income that we were getting because Mr. Moyer does work for other Districts out of this facility.† Is that in this budget?
††††††††††† Ms. Archer responded a couple of years ago we made a change and instead of the money coming into the District and Mr. Moyer paying all the bills out of that money for other Districts, we came up with a lease agreement.† We actually lease this office space from C.S.I.D. and that revenue is in this budget.† The District receives $40,000 a year for this office building.† Also under the contract cost, the accounting and finance and management any shared employees we give you a credit against those costs so you are only paying the net of that, you are not paying the gross management fee.†
††††††††††† Ms. Archer stated in this budget we are closing down the lab.† That is something we did about 60 days ago.† The reason is we only had one lab operator and she said the requirements for keeping the lab certified took up 40 hours a week, every week.† She did not have enough time to actually run the tests that we needed her to run because she was so busy doing all the tests she had to run to keep the lab certified.† She needed us to hire help for her.† Once we started looking into the pros and cons and the costs, it was more cost effective to contract with an outside lab that has a large staff to keep their lab certified.† If we only have one person and if she spends all of her time keeping us certified, she isn't doing any of our tests.† We started farming out some of the tests that we didn't have the equipment for and then she decided to leave and instead of replacing her, we closed the lab.† It made more sense that way.†
††††††††††† Mr. Eissler asked didn't we just build a new lab?
††††††††††† Ms. Archer stated that is the lab they need for their hourly tests that they do all day on the water.† That is not a certified lab, it is a regular water and sewer plant type lab.†
††††††††††† Mr. Fennell stated there must be lab expenses that we have to pay.
††††††††††† Mr. Archer stated under plant operations, water quality testing is $75,514 and it went up just a little bit over the prior year which was $70,415.† That should cover our water quality testing for the year.† We were already sending some out and doing a few inside.†
††††††††††† Mr. Fennell stated for $75,513 we will be able to do the job that was $140,000 before?
††††††††††† Ms. Archer responded that is the budget they gave me.
††††††††††† The difference between the plant and field operations, plant is everything within the fence and field is outside; the distribution system, the sewage collection system, the lift stations, all the things outside the plant site.† The men installing the water meters, inspections on new construction, anything outside the plant site is considered the field.†
††††††††††† Mr. Fennell stated I thought we were going to continue with the re-lining program.
††††††††††† Ms. Archer responded the last time we talked about it, we decided to take some time to evaluate the benefits we are receiving from the program to see if over a period of time reflected a reduction in the infiltration.† Because of the money we are spending on the plant site and other areas, I donít see that we have the funds this year unless we take it out of retained earnings.
††††††††††† Mr. Fennell stated we spent a million and a half dollars on that and what was the return?
††††††††††† Ms. Archer stated we budgeted it but we didnít spend it.† We decided at the beginning of this fiscal year that we were going to wait for a year and evaluate the results.†
††††††††††† Mr. Fennell stated we did replace a lot.
††††††††††† Ms. Archer stated that was in the prior year.† We can ask Mr. Moore to give us an update on the comparison on the year prior to doing that and the last couple of years.
††††††††††† Mr. Moore stated that will come from the records we are keeping now.† That is why we suggested not to do any more this year.† We just completed a yearís record.
††††††††††† Ms. Archer stated this year has been typical as to the amount of rainfall.† In prior years we had a drought that skewed the numbers.† I also asked Mr. McKune to update the construction schedule and our future requirements.†
††††††††††† Page 5 is the total operation and maintenance expenditures projected at $5.9 million against last yearís $6.5 million.† Total expenditures in all departments is $8.4 million against last yearís $9 million.† Our proposed change from the prior year is a deduct of about 7%.† The surplus projected is $264,903 that gives us 111% coverage.† Our bond requirement is 110% coverage.† Out of the $264,903, $200,000 will be deposited into our renewal and replacement fund that is a requirement under our trust indenture that we fund that at $200,000 a year up to $1 million and we have eaten into that so much lately, it is down to about $300,000.† We still have our retained earnings.†
††††††††††† I look at our rates as what we need to be able to fund our renewal and replacement each year and keep things operating.† The rates are right where they should be.† The preventive maintenance programs we are putting together will help with the cost of repairs in the future.
††††††††††† Mr. Fennell opened the public hearing and there being no comments from the public, the public hearing was closed.
FOURTH ORDER OF BUSINESS††††††† Acceptance of the Audit for Fiscal Year 2001
††††††††††† Ms. Archer stated the audit is for fiscal year ended September 30, 2001.† On page 3 of the Independent Auditorís Report it states, the information in this report has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and in their opinion is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole.† They agree with the numbers that we provided them and as stated in this report.† On page 23 is the compliance and internal control letter.† Under compliance they state that the results of their tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards.† If they noted any immaterial matters of non compliance they would report that in the management letter that is a part of this audit report.† Under internal control, they noted no matters involving internal control over financial reporting and its operation that they consider to be material weaknesses.† The management letter is on page 25. There were prior year findings and recommendations.† The prior year findings were that cash balance in the checking account was over $1 million and does not earn any interest and they suggested that we invest that money and we said w would determine a reasonable balance to keep in the account and invest the rest.† Their management comment for this year was that we invested the money and we put a sweep on the checking account so that we would be investing all the money.† We would sweep it out every night and invest that money and it would sweep back in every day based on the checks that we would write.† The auditor said that is not compliant with the investment policy that we adopted because the sweep account is invested in repos and repos are not as good a security as the other investments that they have listed.† We had to get rid of the sweep account because of the repo situation.† Basically they recommend that we add that to our investment policy or not invest in that type of account.† We are investing in items included in our investment policy that is basically the State Board of Administration which still gives us same day liquidity.†
††††††††††† Mr. Miller stated on the issue of paying expenses for other Districts and getting reimbursed, Severn Trent has taken over billing, are they charging us to do that?
††††††††††† Ms. Archer stated we used to run all of it through C.S.I.D. and there was always a delay in getting paid.† Now, all of that runs through Severn Trent and it never goes through C.S.I.D.ís books and Severn Trent carries the receivable on their books.† The lease agreement covers use of this building by other Districts and you are not out of pocket anymore for any expenses such as photo copies and postage and things like that, that you used to front and then get paid back from these Districts.† You used to carry the receivable on your books but now Severn Trent has that liability.† The fax machine and copy machines are no longer in your name and you donít have to bill for that.† They have all been transferred to Severn Trent.† You are not bearing the burden of that expense.†
††††††††††† Mr. Fennell asked is it the same for the computer?
††††††††††† Ms. Archer responded you donít own the computer.† You still have first right of refusal.†
††††††††††† Mr. Miller asked the income from the other Districts that we used to get, does it now go to Severn Trent?
††††††††††† Ms. Archer responded the income you received, covered the exact costs.† They are not making a profit.† They are passing through the costs the same as you did, but you donít carry that liability anymore.†
††††††††††† Mr. Fennell stated the bigger issue is how independent is the District and how difficult would it be if we changed management groups.† The management group changed on us.† The office equipment and computer are not ours anymore and our ability to perform is at issue.
††††††††††† Ms. Archer stated you still have your own equipment except for your computer.† Your billing department only uses a fax machine for their needs.† You have your own fax machine and North Springs has their fax machine.† You still have a lot of your own equipment except for the computer.† When we had to buy a whole new system and be Y2K compliant, Mr. Moyer bought the computer so that all the Districts could use it and benefit from the new software and it was less of a burden on you because it was very expensive.†
††††††††††† Mr. Fennell stated we look at equipment and management.† We should also look at management transitions.†
††††††††††† Ms. Archer stated originally when they bought us out, your H.R. person and your utility billing person were on their payroll but they both expressed to me concerns in the last year that they think Severn Trent was trying to figure out a way to do H.R. out of Houston and utility billing out of Sarasota and they wanted to go back on the District payroll because they want to stay in Coral Springs and do the job they have been doing all along.† Part of this budget puts them on your payroll so that Severn Trent canít steal them away from you and send them to Houston or Sarasota or lay them off completely and have control of the utility billing.† I did that because it was best for C.S.I.D. and North Springs.† They are the ones who keep the whole show going.† Utility billing is our main source of revenue.† We donít want to lose those employees.†
FIFTH ORDER OF BUSINESS††††††††††† Consideration of a Request for a Vacation of a Right of Way Lot 19, Block GG, Ramblewood
††††††††††† This item pulled from the agenda
SIXTH ORDER OF BUSINESS††††††††††† Discussion of Water Management Permit Renewal Policy
††††††††††† Ms. Archer stated you will recall that about a year ago the County was trying to get a special act to requires these Districts to adopt a five year water management permit renewal program.† At this time we issue permits and we donít have a renewal of those permits every five years.† They recently wrote asking us what we did with that and we told them the Board decided to have the engineers put together a list of the magnitude of the permits.† We included in your agenda package a list of permits that go back to 1982 so that you could see the magnitude of the program.† About a year ago we gave you a prototype program to look at that was provided to us by another water control district in the county that they already adopted for their renewals.† They require a renewal of a permit every five years that requires them to send their engineer out to do an inspection of the system that we permitted against the plans and specifications versus what was actually constructed versus what is in the ground and working today, to certify back to the District that everything is in working order and as permitted and hasnít been changed.† That is something that will be at each permit holders expense.† One of the issues we talked about is that most of the permits were pulled by a developer who sold the property to someone else and how do we track down the current holder of the permit.† That is a big task.† These permits go back several years and identifying the current permit holder is going to be a job.
††††††††††† Mr. Fennell asked do we have a choice in this?
††††††††††† Ms. Archer stated the County is trying to mandate that these Districts through the State adopt this program.† Last year the Governor vetoed the bill and they are planning to take it back to the State again this year unless they get some level of comfort that all the Districts in the County that havenít adopted this plan, will.† It is up to you.† You can wait until the State passes a bill or you can have us continue to work to put together a plan, addressing the different issues such as the permits that have changed hands and names over the years.† You can authorize us to start issuing water management permits as of today requiring a renewal, a permit that expires after five years and the procedure to do that.† It would require the permittee to contact us if they transfer the permit to another entity and that sort of thing until we are able to go back to all the older permits and get that permit going.
††††††††††† Mr. Miller stated the essence of this is to make sure they are still in compliance with the recommendations the engineers made initially.†
††††††††††† Ms. Archer stated the difference between our District and some of the older Districts is that we always had a plan.† When these Districts were created there was a master plan of the interconnected drainage system before construction of homes began.† A lot of the districts in Broward County were created after the fact when development had already occurred and to build a drainage system around existing buildings is a lot harder to do because you end up with enclaves that have no drainage.† Our system has always worked and we send divers out to inspect the culverts to make sure they are not blocked with debris and the system works.†
††††††††††† Mr. Miller asked who has the burden of demonstrating compliance with the permit?
††††††††††† Ms. Archer responded we are putting the burden on the permit holder to have his engineer do the inspection and provide us with a certificate that says that everything is as permitted.† I provided you with a list of all the permits issued from 1982.† We will go through the list and cross off the permits that are not for water management.† I can have a list prepared that lists the water management permits only.† All the structures that we permitted are on private property and we donít have a right to go on their property and examine these structures which is why we want to put the burden onto the permittee and their engineers to certify back to us.
††††††††††† Mr. Fennell stated you can provide the list to the engineers and have them go through it and determine which ones should be checked.†
††††††††††† Ms. Archer stated we can have the engineers prioritize the list.† There are probably some things on the list that do not need to be reviewed.
SEVENTH ORDER OF BUSINESS††††† Consideration of Construction Financing Agreement with Stillato Properties, Inc. for Water Main Along N. W. 94th Avenue
††††††††††† Ms. Archer stated this is an agreement we brought to you a couple of months ago and we deferred it because the Developer requesting the agreement had not yet acquired all the property.† We have an area off of 94th Avenue where the water line hasnít been completed and needs to be extended for a few houses and another section where the sewer line needs to be connected.† The water line needs to be looped and the sewer line needs to be completed and they will then construct homes.† In the past we used to enter into the Developer Funding Agreements and reimburse them out of connection fees that we collect and they stood in line behind all the other connection fee financings and subdivision line financings.† We are now at a point where we have paid all of those off and we still collect connection fees from these properties and there is a stretch where we want them to continue to put in the water and the sewer line to complete the system, as part of the project they are starting.† We are agreeing in this agreement to reimburse them for the cost of completing our section of that system while they are doing their section of the system.† It is an agreement that allows us to pay for it upfront rather than have them do it and reimburse them for it down the road when the funds become available because the funds are already available.† We will pay our share upon completion and inspection.† They will dedicate their portion of the system to the District.†
††††††††††† Ms. Archer stated Ms. Kiser is with us today to ask you to approve some documents related to the refinancing.
††††††††††† Mr. Anderson stated I spoke with Mr. Lyles this morning and the documents are all in order and within the scope of the prior authorization.†
††††††††††† Mr. Fennell stated I see where there are certain reports that have to be generated at certain times of the year.
††††††††††† Ms. Archer responded we do that anyway.† You will recall that at the last meeting you hired the underwriter and bond counsel.†† I have been through all the documents and I talked with Mr. Lyles before the meeting and he agrees we are ready to go.
††††††††††† Ms. Kiser stated when I met with you last month we discussed the market environment and what that means in terms of savings.† We are still within those parameters.† I believe the present value basis was about $570,000 representing over 6 1/2% of the amount of principal we would be refunding.† The savings are still there.† Ruden McClosky prepared a summary that I can walk you through that summarizes the bond resolution which gives your staff and consultants the authority to issue the bonds and authorizes the President to award the bonds to the underwriter provided the terms of the bonds are within certain established parameters.† It does not require the President to award the bonds, it simply gives him the authority to do so without having to come back to a formal meeting.†
††††††††††† The first section of the bond resolution sets forth the authority of the District to adopt this resolution which includes the Districtís prior General Obligation Water and Sewer Revenue Bond Resolution, the 1972 Referendum approval and other applicable law.†
††††††††††† Section 2 sets forth various findings including that a negotiated sale to Prager, McCarthy & Sealy as underwriter is in the best interest of the District.† This section also incorporates the provisions of the Districtís prior General Obligation Water and Sewer Bond Resolution.†
††††††††††† Section 3 authorizes the refunding of all of the Districtís outstanding General Obligation Water and Sewer Revenue Bond Series 1978 and a portion of the Districtís outstanding General Obligation Water and Sewer Revenue Refunding Bonds Series 1992 consisting of the 2014 term bond.† You will remember from the last meeting that a portion of the 1992 bonds are not callable so we could not refund that portion.† It authorizes the issuance of the 2002 Bonds in the principal amount not to exceed $11 million which will be secured on parity with the unrefunded bonds which is the 2010 maturity of the 1992 Bonds that is non callable and it authorizes the bonds to be held in book entry system only with the Depository Trust Company which is how all the bond issue registrations of the District and other similar districts are held.†
††††††††††† Section 4 confirms that the net revenues of the Districtís water and sewer system are pledged to payment of the 2002 Bonds as well as the full faith credit and taxing power of the District to the extent that revenues are insufficient for that purpose, the same situation as the outstanding bonds.† There is nothing different.†
††††††††††† Section 5 appoints Wachovia Bank as Trustee, Paying Agent and Registrar for the 2002 Bonds.† This section authorizes the President of the Board or his designee to enter into agreements with Wachovia Bank that may be necessary to evidence its obligation to act as Trustee, Paying Agent and Registrar, all very standard documentation.†
††††††††††† Section 6 approves an Escrow Deposit Agreement, substantially in the form attached as an exhibit with changes as may be approved by the President or his designee in consultation with Bond Counsel and authorizes the execution of the agreement on behalf of the District.† Wachovia Bank is appointed as Escrow Agent.† The Escrow Agent provides for securities consisting of direct obligations of the United States of America to be held in escrow by the Escrow Agent for the period of time from bond closing to December 1, 2002, the date on which the current refunding will occur.† That is as soon as we can call the bonds.† The Escrow Agreement when executed and delivered will provide for the irrevocable redemption of the bonds to be refunded on December 1, together with a redemption premium of 102 for the 1992 Bonds.† This section also authorizes the District Manager to select the verification agent.† The verification agent merely verifies the sufficiency of this escrow that will be used to refund the bonds on December 1.
††††††††††† Section 7 provides that the bonds will not be subject to optional redemption prior to maturity.† This is because of the short maturity.† Call provisions are typically 10 years and the final maturity on these bonds is 2014 and there is no benefit having the bonds subject to optional redemption.† In fact we will save 5 Ė 10 basis points by not doing that.†
††††††††††† Mr. Fennell asked what interest rate do you anticipate getting?
††††††††††† Ms. Kiser responded the last set of numbers that I ran had an average coupon of 3.90%.†
††††††††††† Section 8 provides for the President and Secretary to execute and deliver the bonds.
††††††††††† Section 9 provides for the District to deliver a certificate at bond closing which indicates the manner in which the proceeds of the bonds will be applied which would be to refund the bonds and pay for cost of issuance and that sort of thing.
††††††††††† Section 10 authorizes the negotiated sale of the bonds to Prager, McCarthy & Sealy and approves the contract of purchase between the District and underwriter substantially in the form attached to the resolution which change is approved by the President or his designee in consultation with the District Manager and Bond Counsel.† This section also authorizes the President or his designee to execute and deliver the contract of purchase subject to certain parameters listed in Section 10 of the Resolution.†
††††††††††† We will set the parameters that say we will achieve net present value savings, that we will not extend the final maturity and the par amount will not exceed $11 million.† If we come back to you with only a 2% savings, you, as President can say no, that us not enough.† At the present time it is 6% savings.† The general range for local government has always been 2% to 4% savings and in a lower interest rate environment they will tend to accept a lower present value savings because the likelihood of getting those low interest rates in the future is low but we are above what I have seen at the higher thresholds in terms of savings.
††††††††††† Mr. Fennell asked when do you think the sale will occur?
††††††††††† Ms. Kiser responded that is the process involved.† The first thing we have to do is submit a package to an insurance company and considering the reserve account surety is with MBIA we will submit a package to MBIA.† They will bid a premium for the insurance policy and once we receive that feedback from them, then we can finish the offering document because we have to include the information on MBIA in the offering document, then we will mail it.† I am hopeful that I can get a package out this week to MBIA.† I expect it will take two weeks to get back to us which puts us in the second week of October, maybe we can mail something then and with an insured transaction sometimes we are able to price with an offering document only being out a week or two so by the end of October we will be in a position to price the transaction and quickly close the deal.
††††††††††† Ms. Archer stated we are already working on those things.†
††††††††††† Ms. Kiser stated we have a skeleton package ready to go.†
††††††††††† Section 11 approves the preliminary offering statement substantially in the form attached to this resolution.† That is the document we will use to market the bonds.† This section also authorizes the President to deem the preliminary official statement final, that the P.O.S. ultimately used by the underwriter is complete in all material respects except for pricing details of the bonds, interest rates and maturities.† This section also authorizes preparation of a final offering statement that will reflect the final pricing details of the bonds.† What is before you now is a first draft and we will work with Mr. McKune to get the system information updated then we will have the President deem that offering document final except for the pricing terms and after we price, we will prepare a final offering document which will be mailed to investors.†
††††††††††† Section 12 approves a Continuing Disclosure Agreement in substantially the form attached to this resolution with changes that can be approved by the President or his designee in consultation with bond counsel.† This document is intended to comply with relatively recent SEC requirements that the issuer of bonds provide specified, national repositories with updates of certain information in the final official statement to facilitate trading of the bonds in the secondary market as well as provide notice of certain specified material events.† This section also states that it is not an event of default with respect to the bonds in the event the District failed to comply with the Continuing Disclosure Agreement, although the Trustee and bondholders may seek specific performance of the Districtís obligation.† This is standard.
††††††††††† Ms. Archer stated these are things that we already do on our other bond issues that we have outstanding.† We are required to keep the investors updated on how the District is doing and they are interested that we make our bond coverage requirements each year when we are budgeting and our actual results.† We provide them with copies of the audited financials so that they know we are continuing to operate the system as we committed that we would.†
††††††††††† Ms. Kiser stated Section 13 authorizes the District Manager to obtain municipal bond insurance for the bond and authorizes the President or his designee to enter into an agreement with the bond insurer to set forth any requirements the bond insurer may have with respect to the bonds.† It also provides that the bond insurer may consent to matters requiring bondholders consent in lieu of bondholders other than certain specified matters.†
††††††††††† Section 14 confirms the debt service reserve requirement for the bonds and that both cash and a reserve account insurance policy are currently on deposit in a reserve account.† It also authorizes the District to deposit its legally available funds, a debt service reserve account insurance policy or a combination of both in the reserve account to satisfy the requirement for the bonds in the unrefunded bonds.†
††††††††††† This section also permits the District to deposit a new debt service reserve account insurance policy to the reserve account in substitution for the cash currently on deposit in the reserve account.
††††††††††† Mr. Fennell asked is there any difference in the reserve?
††††††††††† Ms. Archer responded they will go down.† We are going to insure all the reserves.
††††††††††† Ms. Kiser stated we talked about that.† Right now you have $1.6 million in a surety and $450,000 in cash and we are trying to determine whether or not it made sense.†
††††††††††† Ms. Archer stated we compare the premium for the insurance policy versus our loss of earnings on that cash.† Right now we are only earning 1.9% on our money and if the premium is not more than that, we will weigh the benefits of cash funding versus insuring it.
††††††††††† Mr. Fennell asked what kind of account is it in?†
††††††††††† Ms. Archer responded it is in a trust account with the Trustee.†
††††††††††† Ms. Kiser stated Section 15 contains covenants to ensure the interest on the bonds remains exempt from federal income tax.
††††††††††† Section 16 provides miscellaneous authority to officers and representatives of the Board.
††††††††††† Section 17 indicates the Districtís prior General Obligation Water and Sewer Bonds remain in effect.
††††††††††† Section 18 provides for severability of invalid provisions.
††††††††††† Section 19 provides that the resolution will be effective upon its adoption.
††††††††††† Ms. Archer stated basically this is what you need from the Board to keep things rolling.†
††††††††††† Ms. Kiser stated we will update Ms. Archer so that at your next meeting she can update you.
††††††††††† Ms. Archer stated probably on the next agenda and maybe the one after that, we will have a line item that says status of financing.
††††††††††† Mr. Fennell asked do you need specific action today?
††††††††††† Ms. Kiser responded I need you to approve this Resolution and I have another document that I need to have signed which is a letter of representation with DTC, the Districtís request that their bonds be registered with DTC.†
††††††††††† Ms. Archer stated just approval of the bond resolution and the form of the attachments.
††††††††††† Ms. Kiser stated every attachment to the resolution is in the form of.†
EIGHTH ORDER OF BUSINESS†††††††† Staff Reports
††††††††† A.††† Attorney
There not being any, the next item followed.
††††††††† B.††† Engineer
†††††††††††††††† 1.†††† Monthly Water & Sewer Charts
†††††††††††††††† 2.†††† Update on Construction
††††††††††† Mr. Moore stated hopefully in the next few weeks we will start the new wells in the park.†
††††††††††† There not being any, the next item followed.
††††††††††† There not being any, the next item followed.
NINTH ORDER OF BUSINESS††††††††††† Supervisor's Requests and Audience Comments
Mr. Miller asked what is the status of getting the list of scheduled maintenance?
Ms. Holiday stated Mr. McKune was supposed to give that report as well as the long range plan but he couldnít be here today.
Ms. Archer asked did he mention at the last meeting that we purchased the maintenance software and we hired Mr. Mooreís daughter to come in during the summer to input the equipment information into the system so that we could start building a program where it prints out quarterly we will have to maintain this and monthly this is something we have to do and weekly this is something we have to do and schedules the maintenance of all the equipment.† It schedules the maintenance of all the equipment.†
Mr. Moore stated she has a lot of data in now and is working with the employees to get familiar with the software so that we can print out weekly and monthly maintenance schedules.
Ms. Archer stated she not only input the information but is training our people how to use it.
Mr. Miller asked is there a way it can print out a list of everything over $25,000?
Mr. Moore responded at this time we donít have all of the costs input, we basically have the maintenance information and some of the replacement costs.†
Mr. Fennell stated we need that information, even if it is old costs, something is better than nothing.
Mr. Moore stated we are updating our insurance information now and I am putting replacement costs on an insurance form.† Iím not sure that I can have that by your next meeting but I will put that information into the maintenance software.
Mr. Miller stated that is what we want to have.†
Mr. Moore stated we have had several meetings on the long range plan and I think you will see the big ticket items on that list.
Mr. Miller stated that is the most relevant type information because when those items come up we will have to make plans to take care of it.
TENTH ORDER OF BUSINESS†††††††††† Approval of Invoices and Requisition
††††††††††† Req. 117 payable to CSID $850.00 reimburse from Water and Sewer Renewal and Replacement
††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††† ††††††††††† ††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††
William Eissler††††††††††††††††††††††††††††††††††††††††††††††††††††††† Robert D. Fennell