A meeting of the Board of Supervisors of the Coral Springs Improvement District was held on Monday, August 18, 2008 at 3:05 p.m. at the District Office, 10300 NW 11th Manor, Coral Springs, Florida.


            Present and constituting a quorum were:


            Robert Fennell                                                  President

            Sharon Zich                                                      Vice President

            Glenn Hanks                                                     Secretary


            Also present were:


            Kenneth Cassel                                                District Manager

            Dennis Lyles                                                     District Counsel

            Jane Early                                                         District Engineer

            Brenda Schurz                                                  Severn Trent Services

            Sean Skehan                                                    CH2M Hill

            Jim Aversa                                                       CSID  

            Dan Daly                                                          CSID

            Doug Hyche                                                     CSID

            Randy Fredericks                                             CSID

            Kay Woodward                                               CSID

            Jan Zilmer                                                         CSID


FIRST ORDER OF BUSINESS                               Roll Call

            Mr. Cassel called the meeting to order and called the roll.


SECOND ORDER OF BUSINESS                          Approval of the Minutes of the July 21, 2008 Meeting

            Mr. Fennell stated last time there were two different versions.

            Mr. Hanks stated yes.  I saw you guys had a discussion on it.

            Mr. Fennell stated I felt it lacked the flavor we normally have.  Are there any comments or corrections?

            Mr. Hanks responded I have a comment relating to the bid pre-qualification.  In this economic environment, does it make sense to have a requirement to post a bond for completion?

            Ms. Early responded they will be required to post a bond. 

            Mr. Hanks stated okay.  I was not sure.  I know if my clients have to work for the DOT or different utilities, they have to post a bond. 

            Mr. Skehan stated the performance bond is to pick up where the contractor leaves off.  If the contractor is no longer on the project, removed from the project or the work is not satisfactory, that is the intent of the bond. 

            Mr. Hanks asked what about when it comes time for turnover of the project to the District and there is a one year warranty?  Is there a warranty bond required as well?  Because we have already paid the contractors at that point for the work performed.  How are we protected for that money?

            Mr. Skehan responded they generally pay an amount which is left behind in an account tied to what is withheld from each pay request to be able to do this.  You will have 10% at the beginning of the project.  It will go down to 5% and ultimately it will go to 1% or less, depending on the level of how comfortable you are.

            Mr. Hanks asked what is that term called? 

            Mr. Skehan responded retainage.

            Mr. Hanks stated this is different than retainer.

            Mr. Skehan stated it could be defined as an insurance policy against the contractor.

            Mr. Fennell stated we can discuss this under item three.  Are there any corrections to the minutes?

            Ms. Zich stated I am fine with the minutes.


On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the minutes of the July 21, 2008 meeting were approved.


THIRD ORDER OF BUSINESS                             Supervisors’ Requests and Audience Comments

            Mr. Hanks stated I just think it is something we can keep in mind, especially for the nanoplant.  It is getting into a newer area where we do not have the expertise yet on how to keep it up and running.  It is certainly a situation where we could consider a warranty bond.

            Mr. Fennell stated would the time to put that in be…

            Mr. Skehan stated in the specifications when it goes to bid.

            Mr. Fennell asked are there any other items for the third order of business?

            There not being any, the next item followed.




FOURTH ORDER OF BUSINESS                          Discussion of Proposed Water and Sewer Budget for Fiscal Year 2009

            Mr. Fennell asked when will we be adopting this?

            Mr. Cassel responded at the September meeting.

            Ms. Zich stated I have a question on repairs and maintenance.  I question why it went up so much.  There is $200,000 for mechanical integrity test of injection well. 

            Mr. Fennell stated that is actually a guesstimate.  Mr. Skehan, can you speak to that?

            Mr. Skehan responded I can.  The last time mechanical integrity testing was done for both the wells it was probably in the range of $50,000 to $60,000 per well.  This was to have the contractor come out, set up the rig and do all the testing required.  It is three to five days worth of testing.  Over the last five years the contractors who were doing this work, one contractor in particular, have become much more expensive.  There are a couple of other contractors who are doing this, but they are not as well equipped and will take a longer period of time to do testing.  The cost of the one contractor in particular has gone up $75,000 to $80,000 per well to do the testing.  Our fee for this is around $25,000 to $30,000.  The total from our engineering fees and the contractor’s fee gets you to $200,000.  This is a requirement every five years for the DEP permit for injection wells.  Every five years you have to do a video survey.  You have to do a pressure test on the well itself.  We have to make sure it has mechanical integrity and there are no holes or leaks, which could possibly affect drinking water sources.  You have to go in with a radioactive tracer test.  Contractors have to run all of their tools in.  They bring in rigs.

            Ms. Zich stated I am not familiar enough about it.

            Mr. Fennell stated he is right.  It is more expensive and guess what?  We actually put it in the budget this time.  It usually hits us. 

            Ms. Zich stated because it is so much I was thinking it might be for construction.  There was no back up for it at the time so I really did not know what it was.  I am just looking at a $200,000 increase and thinking it must have something to do with what we are building. 

            Mr. Fennell stated well this is the right place to discuss this and it is a good thing to actually put it in the budget.  We should not be surprised by it.

            Mr. Skehan stated we are supposed to have a plan to DEP 180 days before the testing is to take place.  The requirement for the testing to take place is next May or June.  We need to have the plan for testing to DEP by December.  We will be preparing a work authorization to get on the next agenda so we will have ample time to get this to the Board’s attention and to work on it after we are given the authorization to do so. 

            Mr. Hanks asked when is the testing required?

            Mr. Skehan responded in May or June of 2009 and then five years after that.

            Mr. Hanks stated this is something we should consider putting, after this year, $40,000 into a sinking fund for this as opposed to having a figure like this every five years.   

            Mr. Fennell stated my experience with many of these wells has been you never know what you are going to get.  It will be difficult to forecast the cost.  They always go down to look and they always find something wrong. 

            Mr. Skehan stated the last MIT went pretty well.

            Mr. Fennell stated think about it.  We are building a whole new well.  We have a whole other $1 Million we are spending to do the monitoring well.  This fits into a general discussion we have not had yet.  It is costing us a whole bunch of money to sink this stuff down.  Is there a cheaper alternative somewhere in the future?  Maybe not.  I still think the right thing to do is treat the water better and somehow replace it back into the Everglades.  I am not sure we are going to get away with sinking stuff down the wells and they are cutting off the stuff from the sea. 

            Mr. Cassel stated the county is into the large push for reuse, which brings its own set of potential issues and problems.  It is something all of us need to continue to fight.  Reuse is going forward, but it is a solution which is going to be costly for people and I do not think anybody is taking it into consideration.

            Mr. Daly stated at one time our consumptive permit was being held hostage to us building a reuse plant here.  Now the county does it.  They are going to have 100 times more than we will.

            Mr. Skehan stated we are not completely out of that realm.  We are still on the table for consideration.  The water use permit has not been completed yet and we are still in the process of doing the modeling. 

            Mr. Hanks stated we are talking about putting $1 Million into a monitoring well.  Are we going to be in a situation where we go ahead and improve the wells to the point where they are accepting all of our discharge and then get cut off so we are not able to use them? 

            Mr. Skehan responded I do not see it being the case.  Before any regulating agency, primarily DEP, will be able to do this there will be some other technology in place to be able to either treat adequately and to allow disposal in a manner which is going to be perceived as safe.  We talked about reuse in the past.  Mr. Cassel and I were talking about it this morning.  What are people going to do about the pharmaceuticals which are out there right now?  Are they going to allow that reuse to take place in the vicinity of well fields?  That would not make sense in a lot of respects.  Going to deep injection wells, are we going to use water from 3,000 feet which is essentially ocean water?  It is truly a pollution source?  Is it the best way to dispose of it?  Will there be better ways in the future?  I am sure there will be in the future as technology becomes more advanced in that area. 

            Mr. Hanks stated I have a couple of concerns or questions on this budget.  We were down on our combined revenues this year; 10% down for water and 5% down on sewer.  Are the numbers for next year reflecting the reduced consumption?

            Mr. Fennell responded I have the same question.  Water revenue is based on what consumption, current?

            Mr. Daly responded current for nine months and the following three months is when the third and final rate increase kicks in. 

            Mr. Fennell stated you are using the current water amount we generate as the basis for next year.

            Mr. Daly stated as of July 1, 2008 we went into the second phase of the increase in water waste. 

            Mr. Hanks stated the amount of water going out of the plant for the immediately proceeding 12 month period is what was hit with the new raise to come up with the projected revenue for next year.

            Mr. Daly stated that is correct.

            Mr. Hanks stated so perceivably, the only reason this would decrease is if there were a further decrease in consumption by residents.

            Mr. Daly stated that is correct. 

            Mr. Fennell asked why did consumption decrease?

            Mr. Daly responded South Florida Water Management District put in restrictions.

            Mr. Fennell stated we do not really do that much watering of lawns.

            Mr. Cassel stated yes you do. 

            Mr. Daly stated there are tons of irrigation meters out there.  I believe at one time they even backed off a little bit on the pressure.  There was also a shock value when the price increase happened and there were water restrictions.  People reset their clocks incorrectly and they got hit with a big bill.  They went ahead, got rid of it and set their  timers correctly.  As they saw the grass start to die it was a little more powerful for them.  They had the big bill, but they knew it.  Over the course of the South Florida Water Management District water restriction, the first three to four months were really slow and then people started getting used to it or started breaking the law. 

            Mr. Fennell asked how about personal consumption?  Did that drop at all?  Can you tell?

            Mr. Daly responded you can tell to an extent.  We have a rate quote for irrigation only, but if Mr. Smith irrigates his landscaping off of the house meter, it goes in the mix.  You really cannot tell categorically.  The average person uses about 3,000 gallons per person per month. 

            Mr. Hanks stated you should probably take a look at which houses are immediately adjacent to canals and see where their consumption was for the past four months because they will be pulling out from the canal. 

            Ms. Zich asked how many people have wells?  Our house was built with a well.  All the houses in my area were built with wells.  We use well water all of the time.

            Mr. Hanks responded not all of them have wells.

            Ms. Zich stated well I know the builders did not put them in the newer homes.

            Mr. Fennell stated I had to put in my own well.  My next door neighbor just had to redrill the well. 

            Mr. Hanks asked do you know how much it cost to redrill a well?

            Ms. Zich responded we just had ours done a couple of years ago, but I do not know.

            Mr. Hanks asked are we talking $5,000 or $10,000?

            Ms. Zich responded no.

            Mr. Skehan stated probably $750.

            Ms. Zich stated I am thinking less than $1,000 to redrill it. 

            Mr. Fennell asked is there any pattern for the people who actually use our water for irrigation?

            Mr. Daly responded it is tough to say.  I would not know off the top of my head. 

            Mr. Fennell stated if there was actually a large group near here, then we could actually entertain the idea of water reuse.  I suspect it is 1 out of 50 people at best, scattered throughout the area.  We should look at this if we can. 

            Mr. Hanks stated you should get from Mr. Daly a picture of where the irrigation meters are.  Is this something you have?

            Mr. Daly responded I can tell you where irrigation is, who has one and who does not.

            Mr. Fennell stated I think it is worth looking at just in case.  One, maybe there is an opportunity there or two, maybe there is not an opportunity there and we need to prove there is not one. 

            Mr. Daly stated it will be really easy because of all our routes.  Shadowood is one route and Maplewood is one route.  I can go in and say, “give me every meter.”  It does separate between irrigation and regular domestic.  We can say, “okay, there are 300 homes of which 50 have irrigation meters.”  It does not say who has a well and it does not say who lives in a canal. 

            Mr. Hanks stated whether you are drilling a well or a canal, your only expense is your electrical expense.

            Mr. Daly stated exactly, but if we are looking at reuse, you want to know.  No way are we going to talk to “Mr. Brown”.  He is getting his water out of the canal or a well.  He would not be included in the mix.  We can get some data together. 

            Mr. Fennell stated we probably should just because we need to be prepared in knowing whether or not we are sure it is a good deal or not.

            Mr. Hanks stated maybe we should figure out by regulation where we are more likely to send the water. 

            Mr. Fennell stated obviously the closer the better. 

            Mr. Hanks asked was the city ever under any type of restrictions?

            Mr. Cassel responded they were.  When the South Florida Water Management District came out with watering restrictions the city and NSID were all under the same restrictions on watering.

            Mr. Hanks stated I think we also need to get a laymen’s summary as to what the statutes are and the regulations are as far as where we can use the water.

            Mr. Skehan stated it is likely the South Florida Water Management District will require a reuse feasibility study.  It is not exactly laymen’s, but it gets into an analysis as to what are likely commercial enterprises, locally, that you can feasibly do this financially.

            Mr. Hanks stated years ago I worked on a project for FPL.  Because they had food service out on the site, there were certain restrictions as to where we could put the reuse and where we had to make use of other irrigation systems.  I know there are different criteria.  I do not know what the restrictions are in terms of residential.  Basically, whether it is an actual health hazard or it is perceived as a health hazard. 

            Mr. Skehan stated that would be tied into a reuse feasibility study.  More often than not, on the financial component of it, how expensive is it to treat it, how expensive is it to pipe it, do you have customers for this reuse?  Then you will get into the regular component of it.  What level you need the reuse water at.  Does it need to be advanced?  You know, high level disinfections so you will go through some filters and heavily chlorinate it.  That is your typical irrigation type of reuse.  If you want to get into something which is going to be more rigorous funding, if it is going to be put into cooling towers and the reuse water will be going up into the air, it can be carried in a very defined vapor and that is not allowed in a commercial district.  There are other restrictions. 

            Mr. Cassel stated I think the key is to find out where the potential location is and see the amount of customers.  This also gives the engineering firm the ability to push back if they are pushing us for reuse to say, “Look, I only have X number of customers.  The cost effectiveness of serving this number of customers is not attainable for any kind of payback for reuse.” 

            Mr. Daly stated the fact of looking at what it costs to treat the water; the chemicals for next year and the transportation to get the chemicals here.  If we are going to retreat water for reuse, I would just say to forget about putting a well in the ground.  I cannot guarantee as a District that the water I am sending you today is going to be less than $1.00 a gallon next year or the year after.  All of a sudden it becomes a cost of what our price is for this commodity and is it worth it.  A big study needs to be done on this.

            Mr. Fennell stated some organization might try to find a punishment incentive for us to do this.  That is the problem.  Nevertheless, let us first look.  It will be nice if there actually is a good use for the water.  We would like to see that.  I suspect there is not, but we will have a look.  I was looking for A and B on the expenditure of the debt service.  I see the 2002 Series are going to pay off just $65,000, but we are going to pay $281,470 in interest on it.

            Ms. Woodward stated that is correct.  I confirmed this with US Bank.  They confirmed it is the right amount.  We have different layers being paid off at different times.  I put together a chart, which I can make available to you, where I actually put all three of the bond series side by side.  The intention when these bonds were issued is that we have level debt service payments.  What you will see when you put them side by side is between the reduction in Series 2002, it allows you to pay off the 1992 Bond; 2009 and 2010 will be the last two years we pay on the 1992 Series.  When one set is paid off the differential is then moved over to the 2002 Bond.  It increases the amount you are paying in 2011 through 2014 so its a level debt service for all of your series put together, but it is awkwardly structured.

            Mr. Hanks asked are we paying the interest rate first?

            Ms. Woodward responded we are paying off what we are required to pay off.  We are scheduled to pay off the 1992 Series in 2010.  The balance of Series 2002 is scheduled for final payment in the fiscal year ending in 2014.  That coincides with when you issued the 2007 Bonds.  If you recall from the closing documents, there was the indication that your first principal payment was not going to be made until 2015.  You will see because your prior series will all be paid off by then, those funds will be available to put towards the 2007 debt service as well as the increases in the rates on utilities.  In combination it helps you level off your cash flow to help you deal with your debt service. 

            Ms. Zich stated that is very interesting.  I did not realize it.

            Mr. Fennell stated I thought it might be a typo.  I would have expected to pay off $281,470 in debt and $65,000 in interest.  Is the divide in the water we are using for next year the same as this year or the previous year?  It was not so much the cost of the water, it was the divide.

            Mr. Cassel responded the projections are based on this past year with the water restrictions and the consumption that is there. 

            Mr. Fennell stated okay.  You are projecting what we will see next year is if I have been looking at adopted versus actual, I will not see such a large variation like I do now. 

            Mr. Daly stated actually, we made up a lot.  At one time we were looking at about $1.2 Million in revenue for water and sewer that we were going to be down.  That was the first two to three months when the fiscal year started.  Now you are at approximately $600,000.

            Mr. Hanks asked are we still in compliance with the bond requirements in terms of coverage?

            Ms. Woodward responded yes.  If we can ultra conservatively budget the revenues and we can still meet our debt service coverage, we have comfort that if better things happen, restrictions are lifted and there is more revenue coming in, we will be in the best of terms.  We budget revenue to make certain you are not going to be marginally close to having a problem on your debt service. 

            Ms. Zich stated I have another question on repairs and maintenance.  What is Valve Indent & Insert Program in the amount of $25,000?

            Mr. Hanks responded there are a number of places where valves are not known, they have been covered over or whatever, which leads to potential problems down the road should there ever be a break having to take down a large number of customers.  My guess is this is a program by which we are allocating a certain amount of money to go in there and put in new valves. 

            Mr. Cassel stated identifying lost valves is very critical.  You usually have some kind of a valve identification program.  The insert would be to go back in and be able to put a tube down the valve stem so you can turn it off when you need to.

            Mr. Hanks stated or if there are situations where there are no valves, there are techniques available so you can put in a line stop.

            Mr. Cassel stated do a hot tap with a valve and make it so you can shut off a fewer number of people during an issue. 

            Mr. Daly stated there are a lot of variables in this.  If you have the money there and you do not use it, such as the culvert cleaning where we had $150,000 in the budget for it and never touched a penny of it last year, the fact is had we decided it needed to be done the money was there and spoken for.  You will see a lot of that throughout this budget.  It is not padded.  It is cautious with regard to the fact you do not have to borrow from Peter to pay Paul at the end of the year.

            Mr. Hanks asked are we taking any action on this?

            Mr. Daly responded there will be a few more changes made to the budget, only because you will be voting on one thing today with regard to worker’s compensation.  We have gotten a much better number than originally expected.

            Mr. Fennell stated overall it looks as if we will be in good shape next year.  You are projecting a surplus of approximately $900,000.  Even after we take out some required reserves for renewal and replacement, there is probably about $600,000.  You have a $400,000 surplus this year, despite the conditions we are in.  Somebody has done an excellent job of maintaining costs to fit the budget.  I have to say great job because in a trying year where our main product is down, you have been able to cut back expenses.  That is great because it allows us to still serve our customers and not have to do anything drastic. 

            Ms. Zich stated that is really good because our customers would not like a surcharge. 

            Mr. Fennell asked did someone take time to look at electricity since it is a $1 Million a year expense?

            Mr. Daly responded Mr. Hyche did contact a gentleman.  It is actually not feasible to have a company come out.  It is going to cost us over $10,000 to do an efficient analysis.  We are doing other things.  Mr. Cassel, do you want to comment on the energy audit we talked about with Mr. Hyche and why we probably are not going to go in that direction?

            Mr. Cassel responded yes.  It is due to a couple of things; one is the cost of it and two is what we already have in place.  For the type of pumps, motors, etcetera that we are running, we are as efficient as we are going to get.  You might be able to save in one or two areas.  The cost to get there far exceeds any savings.  FPL is going to reevaluate some of the transformer boxes and will look at how we are set up. 

            Mr. Daly stated one thing Mr. Hyche is doing is having our electrician take out some of the lights and put them on photoelectric motion detectors because you really do not need this place lit up like a Christmas tree at night.  That is going to be taken care of.  We already have our air conditioners on timers.  We are doing some little things.

            Mr. Hanks stated so you are taking the approach there are known things we can do.

            Mr. Daly stated that is correct.  As far as the big motors and things, we have nothing to look forward to with our old plant as far as electricity goes. 

            Mr. Hanks asked how many motors will the new plant have?

            Mr. Skehan responded there will be a lot of motors out there.

            Mr. Hanks asked do you know how many?

            Mr. Skehan responded there is one large pump per train for the membrane feed pumps.  That is where the largest usage will be.  There are other smaller motors, which range from 2 to 3 horsepower pumps all the way up to 200 horsepower pumps.  There is a wide range in what the size of the pumps and motors will be. 

            Mr. Fennell asked so what is FPL going to do for us?

            Mr. Daly responded I will have to talk to Mr. Hyche about the specifics of it.  He has a list.

            Mr. Fennell stated maybe there is somebody from Severn Trent who can come in as part of our normal services and check.

            Mr. Cassel stated I will check on that.

            Mr. Fennell stated I noticed we spend $200,000 disposing of  waste products.  Is this worth bidding out?

            Mr. Cassel responded Mr. Hyche keeps an eye on that.  I believe he has done it recently.  I will double check with him and get back to you on it. 

            Mr. Daly stated this year we will also bid the uniforms contract.  It is coming to the end of its term and we already know we will probably get a better price.  Mr. Hyche is on his way over.  He should be here soon.

            Mr. Fennell asked are there any other comments or questions on this budget?

            Mr. Hanks responded no.  Do we need to set a date or make a motion?

            Mr. Lyles responded it has already been set by resolution at the previous meeting.


FIFTH ORDER OF BUSINESS                               Consideration of Arbitrage Rebate Engagement Letter(s) with Deloitte Tax, LLP

A.                 $21,915,000 General Obligation Water and Sewer Revenue Refunding Bonds, Series 1992

B.                 $9,120,000 General Obligation Water and Sewer Refunding Bonds, Series 2002

C.                 $43,255,000 Subordinate Water and Sewer Bonds, Series 2007

            Mr. Fennell stated I read through these and I still do not know exactly what we are getting for $1,500 a piece. 

            Mr. Hanks asked after we spend all of this money are we going to get something out of it?

            Mr. Lyles responded this is to avoid paying a penalty.  This is required.  You are not allowed to make money on the float for tax exempt bond issues you have partaken of under the tax code.  You are required to do arbitrage rebate calculations so you in essence file a form of tax return with the government indicating you did not make excess money on interest calculations while you were holding the money before you spent it.  It is a lot more complicated than this.  I am not a tax expert, but you are required to do this to ensure you are within the federal rules on arbitrage, which is earning money on tax exempt interest you have.  If you issued the bonds at 7% and you are earning 9%, you have a 2% profit you are making there is no tax paid on.  That is a simplistic example.  Ms. Woodward may be better off explaining this.

            Ms. Woodward stated that is a perfect example.  The computation is done annually, but in truth there is only one time when there will be a true up and a check is or is not written.  This is when you pay off the bond.  If you issue a 25 year bond, you are going to make 25 annual computations.  When you get to the final computation it is an accumulative computation from the date you issued the bond.  When the final computation is made in 25 years and you paid off the bond, if there is a true liability, the District will have to write out a check to Uncle Sam. 

            Mr. Hanks asked because the aggregate of this is an excess of $4,000, is this a service which has to go for bid?

            Mr. Lyles responded no.

            Mr. Hanks asked are there any concerns in the subject of the agreement?

            Mr. Lyles responded yes.  We probably could have looked at it sooner, but it actually was not the subject of a document that was circulated.  It was just in your agenda package.  I do have some heartburn as your counsel over the paragraphs on their responsibility to you if they commit an act of negligence which ends up costing you money.  They have capped their damages in that event at essentially refunding the fees which were paid.  You might get $1,500 for a $50,000 loss you incur.  They also require the District indemnify them if there are any claims arising out of their performance of this unless they act in bad faith or there is intentional misconduct, which is a very high standard that will be impossible to prove.  We need to work on the damages and indemnification provisions of this agreement.  I do not know what the timing is on this or if you have to approve it now.

            Mr. Woodward stated it is not a crisis.  The only one which could actually be computed now is the 1992 Series because it was issued in June.  We are in a position to give them the 12 months worth of statements from US Bank and they can start the computation, but they can start it another month from now. 

            Mr. Lyles stated I would like to get them to work with us on all of the disclaimers they have on liabilities and the indemnification.  That would be considered kind of an informational report and maybe we can bring it back for final vote at the next meeting.

            Mr. Hanks asked what are the benefits to having an outside firm do these calculations versus doing them in-house?  Do we have the capabilities to do it in-house?

            Ms. Woodward responded I would feel more comfortable if someone else was doing this computation, but by the same token they want to make certain if there were claims brought up, they will not be held responsible.

            Mr. Hanks stated if we are paying $4,500 at our own risk and they are not budging on it, do it in-house.  If you feel reasonably confident on this, we might as well do it in-house. 

            Mr. Lyles stated we can look at that as well.  As a fall back.



On MOTION by Mr. Fennell seconded by Mr. Hanks with all in favor the arbitrage rebate engagement letters with Deloitte Tax, LLP were tabled until the next meeting pending further review from counsel.


FOURTH ORDER OF BUSINESS                          Discussion of Proposed Water and Sewer Budget for Fiscal Year 2009 (Continued)

            Mr. Daly stated Mr. Hyche has joined us and will be happy to answer any questions you might have.

            Ms. Zich stated the $25,000 for Valve Indent & Insert Program, I do not know anything about this.

            Mr. Hanks stated tell us about it.

            Mr. Hyche stated you caught me by surprise.  Let me take a look at it.

            Ms. Zich stated it is on page 19 near the bottom. 

            Mr. Hyche stated that is your valve replacement program.

            Mr. Cassel stated for identification of valve replacements.

            Mr. Hyche stated yes. 

            Mr. Cassel stated Mr. Hanks, you are right on the money.

            Mr. Hyche stated street valves get paved over quite a bit. 

            Mr. Fennell asked is there any other question?

            Mr. Hanks responded sludge hauling.

            Mr. Hyche asked sludge hauling under H&H Sludge or DRD Enterprises?

            Mr. Hanks responded if we are going out and bidding these things.

            Mr. Hyche stated I doubt you would get another bidder for your sledge hauling.  H&H Sludge is going to be the one that does the land application, which is what we use with our solids from the wastewater.  I doubt you can get another bidder on that.  I guess it is possible to go out to bid for it.  DRD Enterprises, the last time we went out to bid for that, they were the lowest bidder. 

            Mr. Hanks stated this will be once the nanoplant comes along.

            Mr. Hyche stated once the membrane plant comes in.  That is correct.


SIXTH ORDER OF BUSINESS                              Consideration of Work Authorizations

            A.        WA No. 47 – Dumpster Pad Design

            This item was pulled from the agenda.


B.                 Amendment to WA No. 42 – Pump Station #1 and #2 for a Net Increase of $3,600

            Mr. Fennell asked why are we paying $3,600?

            Ms. Early responded it is basically due to the city.  For example, we went back again for the permit.  The door manufacturer went out of business so we had to get it from another company, which their doors are better.  The city wanted us to revise the drawings.  We had to revise the drawings.  The contractor took a bad hit again and there was a three week waiting period.  There were so many other things.  We are trying to work with South Florida Water Management District to move the fence out of where the canal bank is caving in.  That was a couple week process.  They came back to us and told us if they let us do it, it will be a 90 day permit.  We said, “forget it.”

            Mr. Hanks asked why does the city care if it is under one contractor or two?

            Ms. Early responded I have no idea.  That was an argument I had with the city. 

            Mr. Hanks stated you could go back to the city and tell them it does not matter. 

            Ms. Early stated I told them the District bid one contract for all of this work.  They wanted separate plans.  I convinced them into making two separate books because they wanted the District to have two separate contracts.  I told them it was too late.  It was already done.  I made two books and highlighted the different costs. 

            Mr. Hanks stated as far as the plans.  I am surprised you have them all on the same set of plans.  They are different distinct locations and structures.

            Mr. Fennell stated so this $3,600 is going to CH2M Hill.

            Mr. Early stated we had separate sheets for each pump station.  Everything else was separate.  There were four or five sheets we had to change.

            Mr. Hanks stated I understand the problems you have with the city.  I have been through those as well, but some of these approaches come out to $3,600.  Inspection services comes out to $25,000.  You are a creative engineering firm.  There are two distinct locations for permits.  They put them on the same set of plans and try to permit them together. 

            Ms. Early stated we did not do the permitting.  The permitting is being done by the general contractor.  We did not have to pull the permits for the design.  We had to pull permits for the roofing.  I had to send it out to West Palm Beach and have it signed off by the appropriate people.  We never had to do this before.  There were some different things implemented. 


On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor Amendment to WA No. 42 for pump stations #1 and #2 for a net increase of $3,600 was denied.


SEVENTH ORDER OF BUSINESS                        Staff Reports

            A.        Manager

                        i.          Consideration of Meeting Schedule for Fiscal Year 2009

            Mr. Cassel stated in your package are the dates which fall on the appropriate Mondays for the next fiscal year. 

            Mr. Fennell asked I assume you looked at February, right?

            Mr. Cassel responded yes. 

            Ms. Zich stated I looked at the holidays and they covered them.


On MOTION by Ms. Zich seconded by Mr. Fennell with all in favor the meeting schedule for fiscal year 2009 was approved.


ii.                  Consideration of Commercial Workers’ Compensation and Pollution Liability Insurance

            Mr. Cassel stated staff went out and secured bids for next year’s workers’ compensation.  PGIT came in with the best premium.  As you can see the Florida League of Cities would have been $81,468.  FHM was $85,615 and PGIT is coming in at $69,580 for workers’ compensation.

            Mr. Fennell stated I assume it is the same coverage we already have.

            Mr. Cassel stated yes.

            Mr. Hanks asked are there any concerns with these insurers and how they get their resources?

            Mr. Daly responded we have PGIT for our general liability coverage as well.  You had asked the question a few months back when we were going through the SBA issue.  In no way, shape or form are they included in or do business like what had happened with SBA. 

            Mr. Hanks stated is that through the agent?

            Mr. Daly responded that is correct.

            Mr. Hanks asked does that agent represent the other two companies?

            Mr. Daly responded yes.

            Mr. Hanks stated so he had other dogs in the race.

            Mr. Cassel stated that is correct.

            Mr. Daly stated we had the Florida League of Cities here for years.  Two years ago the District was spending $100,000 for workers’ compensation insurance.  Now we have a proposal for $69,580.  A lot of it has to do with the fact management has kept workers’ compensation related incidents down to almost zero.  We probably had two this year and they were very minor. 

            Mr. Hanks asked did Severn Trent come out recently and do a safety analysis?

            Mr. Cassel responded yes. 

            Mr. Hanks asked do the insurance companies recognize that?

            Mr. Daly responded they do to a degree.  We also invited PGIT to come out unannounced.  Because we have them as our carrier for workers’ compensation we invited them out.  We deal with the company for general liability as well.  They did a safety audit.  They went to the lift stations.  They went in the tanks.  They went all over.  Today we saw the last of the report.  We are so far ahead of most other people out there with regard to OCIA requirements that will be mandated in two years for everyone.  There are just a few things like a defibrillator.  We might want to put in a few more eye wash stations, but for the most part we are right where we need to be.  Mr. Cassel is more than aware, because we meet weekly, that management is on top of safety equipment.  We are making sure there are safety checks done, spot checks and we have conferences with the crews.  We are really big on this kind of stuff.  PGIT did this for us free of charge.  If we would do it on our own it would have cost more than $1,000.  We recommend using PGIT because of the price and because of the company they are.  They mean what they say and they say what they mean.  They back us up with all sorts of training material.  It is great.  These are things we did not get from our former workers’ compensation carrier. 

            Mr. Fennell asked do you have this budgeted?

            Mr. Daly responded yes we do. 


On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the proposal for workers’ compensation insurance coverage through PGIT in the amount of $69,580 was approved.


            Mr. Cassel stated the second item under that is pollution liability insurance with Illinois Union Insurance Company.

            Mr. Hanks asked is this a new creation by insurance companies?  I have never heard of this.

            Mr. Cassel responded no.  We had it in the past. 

            Mr. Daly stated last year we paid $7,014.

            Mr. Hanks stated and we are at $5,000 this year.

            Mr. Cassel stated $5,000 and we are going to add the terrorism rider premium of $250 on it.

            Mr. Fennell asked what does that mean?

            Mr. Cassel responded if someone were to come over, do something to the plant as an act of terrorism and creates a pollution issue, it helps to cover it.

            Mr. Fennell asked how much will the coverage be?

            Mr. Cassel responded it is $5,000 without it and $5,250 with it.

            Mr. Fennell asked if something were to go wrong, how much money would they pay out?

            Mr. Cassel responded $1 Million per occurance.


On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the pollution liability insurance coverage through Illinois Union Insurance Company with the terrorism rider premium in the total amount of $5,250 was approved.


                        iii.        Monthly Water and Sewer Charts

            Mr. Hyche stated I put in the lift station hour runs and how it corresponds with the effluent flow to the wastewater treatment plant. 

            Mr. Fennell asked what is the conclusion?

            Mr. Hyche responded I’m going to see what type of infiltration we are actually seeing. 

            Mr. Fennell stated we had talked about whether or not we want to automate some of the lift stations as far as the levels go and being able to understand when they get close to overflowing.  The worst case scenario I see is when we have a hurricane and we are running around to all the lift stations.  Do we know enough to know which ones to go to?

            Mr. Hyche responded yes.

            Mr. Cassel stated in your annual emergency response reports you have to identify all the critical lift stations within the system.  They already have it drilled down as to which lift stations are critical and what their pump times are in an emergency response for the terrorism book Homeland Security requires.  He already has it drilled down as to which ones are most critical.  He knows exactly in the whole flow and scheme, which stations and how he can pump them at a sequence to keep them down and flowing to the plant.

            Mr. Hanks asked is our fuel situation taken care of?

            Mr. Hyche responded everything is taken care of and we are ready to go.

            Mr. Hanks stated you got propane out to the pump stations.

            Mr. Hyche stated prior to hurricane season I had a company come out and clean out our gasoline tanks so we do not have any problems with algae or moisture.  We clean up the fuel left in there prior to the next hurricane season and we will top them off again.

            Mr. Fennell asked is that needed?

            Mr. Hyche responded yes.


iv.                Utility Billing Work Orders

            Mr. Hanks asked are these normal seasonal variations within the misreads?

            Mr. Daly responded I do not know.  It is only two more than last month.

            Mr. Fennell stated I want to congratulate everyone in this room who has been watching expenses. 

            Mr. Daly stated there are a lot of little things Mr. Fredericks and his men are looking at to see if they can do it as oppose to getting an outside contractor.  These are very capable individuals. 


EIGHTH ORDER OF BUSINESS                           Approval of Financials and Check Registers

A.                 Projected Cash Flows

B.                 Summary of Cash Transactions

            Ms. Zich stated I just have one comment on the assessment collections.  If you look at the current gross, there was $125,216.24 collected in July.  How come so much was collected in July?  Is it because there are so many people not paying their taxes?

            Mr. Hanks responded I completely missed that.

            Ms. Zich stated it was just so high.  It is reflecting $125,216.24 in July.  Normally we collect it all the way up in November and December.  It is nice we are collecting $125,216.24 in July, but it was due last November. 

            Ms. Woodward stated it is probably due to tax certificates for people who were not able to pay their bills on time.   


On MOTION by Ms. Zich seconded by Mr. Fennell with all in favor the financials and check registers were approved.


SEVENTH ORDER OF BUSINESS                        Staff Reports (Continued)

            B.        Attorney

            Mr. Lyles stated I have nothing more to report.


C.                 Engineer

i.                    Project Status Update

ii.                  Project Status Report

iii.                Drawdown Schedule

            Mr. Hanks stated I have one thing I would like to bring up with regard to the Broward County Surface Water Coordination Committee.  They are asking there be a technical representative from the District as well.  I just wanted to bring this up and get input as to who can be the technical representative. 

            Mr. Cassel stated I would say initially Mr. Hyche and we will utilize CH2M Hill as back up.

            Mr. Hanks stated okay. 

            Mr. Daly stated Mr. Hyche attended a meeting with some of his employees with regard to our own plant.  He said every Board member should go to the meeting to find out some of the things about what we just purchased and what we are about to put in.  Next time there is a meeting, we will be happy to invite you to come.  We have money in the budget for it.  It is education for the Board members.  It is something he was adamant about.  He feels you really need to see what this is going to do for us.

            Mr. Fennell asked what is happening with the pilot testing?

            Mr. Cassel responded it is in the engineer’s report under Section 7C.

            Mr. Skehan stated the equipment is expected for delivery soon and then it has to be set up to proceed with it onsite.  It is part of what will be taking place next month.

            Mr. Hanks stated you have the landscape berms in.

            Ms. Early stated I called the city several times.  We are still going back and forth on whether they can give me a letter on just the berm. 

            Mr. Skehan stated they are now asking questions about when the rest of the site plan is going to be implemented.  It was previously explained to them what we were trying to accomplish was to satisfy the city’s complaint.  They were adamant about it being resolved.

            Mr. Hanks stated we have to be careful with what the city has associated with the site plan.  We need to get going on it.  There is a timeline for expiration on site plans.  We are barely going to be putting a shovel in the ground for some of this stuff and the site plan will be past its expiration.

            Mr. Skehan stated the site plan is in the process of being revised right now to capture all of the new structures which are going to be built.  Part of the frustration is we have these conversations with the city and they seem to forget them. 

            Mr. Hanks stated follow up.  Send emails to them so at least it has been out there and circulated. 

            Mr. Skehan stated we have done that.  Their expectations of what is tied to how things get done and what is reasonable are often times significantly different to what you would see in other locations.  We are still trying to get this component resolved.

            Ms. Early stated they indicated they saw the berm and it is not that they are unhappy with it.  They just want to check off everything else.  They are not willing to give me something in writing.  Mr. Powers asked when the rest of it was going to be finished.  He is acting like he anticipates a lot more landscape going in. 

            Mr. Skehan stated part of the discussions related to additional landscaping which was going to take place primarily on the east side of the facility.  The discussion we had before, which made sense, was that it would be part of the new building.  There was no misunderstanding about it at the time.  At this point it sounds like we have to go back in and remind whoever it was of those discussions. 

            Ms. Early stated I called them back and left a message saying there was a meeting on such date and what was discussed with whom.  The priority was to get this permit first and I wanted to make sure the city is happy with phase one, which is the berm. 

            Mr. Hanks asked are we going to go through the breakdown with the city to get things moving?

            Mr. Skehan responded we just heard of this recently for the first time.  We are in the preliminary stages of getting everything together.  We will talk to them early next week. 









NINTH ORDER OF BUSINESS                             Adjournment

            There being no further business,


On MOTION by Ms. Zich seconded by Mr. Fennell with all in favor the meeting was adjourned.







 Glen Hanks                                                                    Robert D. Fennell                                

 Secretary                                                                         President