MINUTES OF MEETING

CORAL SPRINGS IMPROVEMENT DISTRICT

A regular meeting of the Board of Supervisors of the Coral Springs Improvement District was held on Monday, April 19, 2010 at 3:05 p.m. at the District Office, 10300 NW 11^th 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

Dan Daly Director of Operations

Kay Woodward District Accountant

Jan Zilmer Human Resources

Randy Frederick Drainage Supervisor

Ed Stover Water Department

David Macintosh Wastewater Department

Cory Johnson CH2M Hill

Gerrit Bulman CH2M Hill

Carl Easton CH2M Hill

Chris Sunberg CH2M Hill

Stephen Bloom Severn Trent Services

FIRST ORDER OF BUSINESS Roll Call

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

SECOND ORDER OF BUSINESS Tour of Onsite Construction

Mr. Fennell stated one of the things we have wanted to do is to take an official tour of all the construction we have going on. Although it is raining on and off here today, we are a trepid group who is willing to take it on. What do we do?

Mr. Lyles responded you are going to be in session during the inspection trip to comply with the Sunshine Law. This is why the meeting was opened first. The manager is going to take minutes of the observations and discussions. I do not expect you will be voting on anything while you are being informed of what you are looking at, but there will be minutes taken and any member of the public who wants to join the tour and listen to what the Board is hearing is welcome to do so. With that; you are not recessing, you are merely leaving this particular location and walking through other portions of the District’s property prior to coming back and resuming your normal agenda.

Mr. Cassel stated I will turn the recorder off at this time and take notes of the tour to present to the recording secretary.

The record will reflect the recording was turned off during the onsite tour. The following is a summary of what was transpired.

The Board was accompanied by Mr. Cassel, Mr. Daly, Ms. Woodward, Mr. Johnson, Mr. Easton and Mr. Sunberg to the construction area of Tank F and the nanofiltration building. On the way to the construction area the Board had the opportunity to see the tractor trailer truck, which staff is recommending be replaced. The Board commented on the poor condition of the truck.

Mr. Johnson explained the current status of Plant F as well as some of the concerns with the contractor’s construction techniques. Mr. Sunberg thoroughly explained the welding issues that are trying to be addressed with the contractor. The Board then went inside Plant F and saw the diffusers as well as the central missing equipment. The Board asked questions with regard to analysis of welding issues and possibly having third party evaluations.

The Board then moved to the east end of the site, which overlooks the nanofiltration building. Due to the weather conditions there was no construction activity at this time. The layout of the building was explained. The Board had several questions for the different CH2M Hill representatives regarding the different portions of the project that were under construction.

Lime Softening Plant #3, which will be undergoing rehabilitation in early June, was also shown to the Board as a point of interest. The Board then walked back to the meeting room where the tape recorder was turned back on for the meeting to continue.

Mr. Cassel stated we are back in from our tour of the site.

THIRD ORDER OF BUSINESS Approval of the Minutes of the March 15, 2010 Meeting

Mr. Fennell stated each Board member received a copy of the minutes of the March 15, 2010 meeting and requested any corrections, additions or deletions.

Mr. Daly stated on page 14 it states, “this lake”.

Mr. Fennell asked what should it read?

Mr. Daly responded “the slaker”.

Mr. Fennell asked are there any other corrections?

Ms. Zich responded I just wanted to say Mr. Bloom was also present at the last meeting.

Mr. Cassel stated we will correct that. It was my oversight. I forgot to put him on the list.

On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the minutes of the March 15, 2010 meeting were approved as amended.

FOURTH ORDER OF BUSINESS Supervisors’ Requests and Audience Comments

Mr. Daly stated I have one quick comment. Mr. Stover and Mr. Johnson took our entire water plant crew on a tour last week. Where did you go?

Mr. Stover responded to the Florida Keys Aquifer.

Mr. Daly stated they actually got to see it first hand and ask questions.

Mr. Hanks asked what was the eco-interest down there about the Florida Aquifer?

Mr. Johnson responded we just designed and provided SDC for a six engine ERL.

Mr. Hanks asked SDC meaning?

Mr. Johnson responded services during construction.

Mr. Hanks stated okay.

Mr. Johnson stated it is similar in that it is a membrane plant. There are four trains instead of three. There are a lot of similarities between that and this. It was good for them to be able to see it.

Mr. Fennell asked is it operating?

Mr. Johnson responded it is.

Mr. Fennell asked so do we have some contacts down there to call if we need to?

Mr. Daly responded sure.

Ms. Zich stated I did not see Mr. Blooms name, but he was going to give us some more information about the method of putting our money into financial institutions.

Mr. Cassel stated we can do that under the financial section.

Ms. Zich stated okay.

Mr. Fennell asked anything else?

Mr. Hanks responded I have a request for whoever puts together these charts. Is that Mr. Frederick?

Mr. Cassel responded no.

Mr. Hanks asked can you throw in a running 12 month average on these things? When we start seeing the variations from 18% loss down to zero for some months, I think we took a longer look on it, if you can throw a running average for the preceding 12 months it will be a better way to take a look at it.

FIFTH ORDER OF BUSINESS Staff Reports

A. Manager

· Consideration of Truck Bid

Mr. Cassel stated as we walked by you saw our excuse of a tractor we use to move the sledge trailer around. We went round and round to figure out a way to replace it. Most of the prices we were getting locally were in the $10,000 to $14,000 range. We looked on Craig’s List and found one in Cape Coral for $6,800. It is in good shape. We advertised as required for individuals to submit proposals for selling us a vehicle which met a certain description within parameters. We had one individual who submitted and it turned out to be the individual we originally contacted in Fort Myers. His proposal was to sell the 1996 dual axle, single cabin, international tractor trailer truck; it has approximately 560,000 on it with a clear title, in the amount of $6,800. That is the proposal we have. We have some pictures as part of the package. It came in late.

Ms. Zich asked has anyone gone over to look at it?

Mr. Cassel responded yes. We sent one of our people over to look at it before we ever went down this road to make sure it would be something that would be viable for our usage.

Mr. Daly stated some of the trucks we looked at had 1.5 Million miles.

Ms. Zich stated it looks a lot nicer than the one sitting out there.

Mr. Daly stated the one out there is actually a danger and they should not use it. It does not stop properly.

Mr. Cassel stated we have had some issues with it.

Mr. Daly stated it is dangerous so the sooner we can do this the better.

Mr. Cassel stated as I understand it they have to pull a certain wire to do certain things; either to get it started or to get it stopped out there. We looked at it and said it was unsafe to have it around. We need to change it. The key was to find out the best way to change it at the least expense to the District.

Mr. Fennell stated that is pretty cheap, actually.

Mr. Cassel stated yes.

Ms. Zich stated and we are not going to be using it on the road. It is just to drive within the facility.

Mr. Daly stated only inside, not outside.

Mr. Cassel stated when we walked by it was parked at the filter press. It fills up and then they take it over to behind Tank F where we were. There is a pavilion where it is parked under cover. Then we have an outside contractor who comes in and picks up the loaded trailers there, takes them out, then dumps them and then brings the trailer back.

Mr. Fennell asked as far as the budget, where does it come out of?

Mr. Daly responded because it is so inexpensive it would not be worth going under renewal and replacement.

Mr. Hanks asked how long do you think this thing might last?

Mr. Cassel responded at least 10 to 15 years.

Mr. Hanks stated counsel it looks like we passed the…

Mr. Lyles stated believe it or not I was involved in this every step of the way. I am fine with it.

On MOTION by Mr. Hanks seconded by Ms. Zich with all in favor the bid to replace the tractor utilized to move the sludge trailers onsite at a cost of $6,800 was approved.

· Monthly Water & Sewer Charts

Mr. Cassel stated Mr. Hanks made mention to this already. Do you have any other questions?

Mr. Fennell asked did you ever figure out whether the pumps versus hours were correct for the actual amount of water pumped?

Mr. Cassel responded we are still working on some analysis and feeding Mr. Hanks some data on it.

Mr. Hanks stated I met with Mr. Cassel and Mr. Crowell out in the field. I got a better understanding of how the data is being collected. We still do not have a full amount of data.

Mr. Cassel stated we do have some rain data.

Mr. Hanks stated when we were out there; was it lift station one or two we looked at?

Mr. Daly asked was it four?

Mr. Cassel responded I think it was four.

Mr. Daly stated I believe it was four.

Mr. Hanks stated the pumps were running fairly frequently and the manhole was not in a surcharge condition. It had been dry for about a week. There are some issues out there with the system.

Mr. Fennell stated here is my complaint about the I&I report. It is a wonderful report which talked about all of the ways we could have problems, but there was nothing that actually told me what the problem was. I could get a junior CE from the University of Florida to write that paper. He could go through his text book and write a paper like that. It would be well done, but unless there is actual real data which says something about what the problem actually is, I do not think we got our money’s worth. I expected some actual conclusive results about what the problem is.

Ms. Early stated I do not think we did 100% of the scope because of the lack of data.

Mr. Fennell stated we have been going on and on about this for a year maybe.

Mr. Cassel stated it has been six months.

Mr. Fennell stated even so, I would expect less fluff and more insight.

Mr. Hanks stated somebody light up a fire under Mr. Crowell so that the data is distributed to them and us so we have something we can be working on to try to narrow down the problem.

Mr. Daly stated that is not a problem. We will see him tomorrow. Is the data which goes to CH2M Hill via Mr. Crowell an expansion of the already existing work authorization which has been closed out?

Ms. Early responded no. He has not billed 100% because we did not complete 100% of the scope.

Mr. Fennell stated I expect to see some conclusive engineering results. I used to teach problem solving in engineering so I know what to look for.

· Utility Billing Work Orders

Mr. Cassel asked are there any questions on these?

Mr. Fennell responded no.

Mr. Cassel stated in this section I put before you, because it was not an agenda item, the Six Sigma Analysis that I started to get some feedback from the Board to go forward on the total nitrogen. This is data from 2005 to I believe 2009 on one site. The total nitrogen along with the curves; the mean of the data, the standard deviations and the curves. After discussion with Mr. Fennell I will be converting this data of the five years into a conglomerate data to see what it looks like as a whole for that particular site over a five year period. Then I will do the other sites similarly.

Mr. Fennell stated once we do that I would like to compare it to any other data out there. You must have some from other groups or other districts. There must be some kind of data. I would like to see how it compares.

Mr. Cassel stated there is some from the Florida Association of Special Districts. I will put an email out to them as well.

Mr. Hanks asked what were the limits imposed by DEP?

Mr. Cassel responded they were down in the .4 or .5 range for total nitrogen or lower.

Mr. Fennell stated this just shows us the first year the mean was 1.02. The six sigma value was 6.1.

Mr. Hanks asked what does that mean?

Mr. Fennell responded that means that the six sigma is the current quality standard if you were going to have a very high quality or something. You would be out six standard deviations from your mean. If you were trying to include something like that in a quality, you would want to be at least that far out. That means if you are going to have a specification and you want to make sure all of the parts could in fact work in your design, you design to a six sigma standard and you make sure that the six sigma, either when you design the water or you actually put your specification at 6.1. That is just for the first year.

I think it was interesting. That mean was 1. In the 2006 data the mean was at .94 and the six sigma is now at 7.3. The 2007 data had a mean of 1.995, which doubled the mean. That is unbelievable. When I was talking about how high the six sigma values were that anticipated you could in fact have this kind of variance. Here the six sigma standard is 8.25. If you go to 2008 the mean drops back to .94, the six sigma is around 6.45. The 2009 data had a mean of .6125, but the six sigma was at 5.5.

What you do is you put all of this data together and see where they really come out. Frankly, the specification you should be looking at is the six sigma specification. I am not even sure you have enough data here to have enough sampling. This is the way you actually talk about specifications and meeting specifications. You can see right away if someone just came in and took a mean, for instance we took the .5 specification, I do not know. You did not go down low in that. Well you can anticipate that. The standard deviation was .84. The probability of making the specification is 30%. There are obviously some issues here as far as specifications. Let us put together a specification with six sigma and with the mean through all those years. I still question the data as far as there being enough data statistically.

Mr. Hanks asked what is the standard? Is it based on daily or quarterly?

Mr. Cassel responded I believe they are proposing a 12 month average or a number which cannot be exceeded in a particular quarter. There are some different things they are proposing. One of the biggest questions which arose is that the waters in the state, the rivers, canals and etcetera, flow from the north to the south. The south part has a tighter standard, meaning lower allowable limits, than the north and central part. They are allowed to contribute, but we end up having to treat and bite the bullet on the issues because a lot of it does flow south and come into our areas.

The other issues which come into play are fertilizer from homes and the special districts perspective is we have no control of the sale or control of what fertilizers people use on their lawns or anything else, but yet it ends up in a waterway that we are now responsible for. There are a number of issues with this, coupled with the fact that our systems were designed for flood control not nitrogen and mogul. As one engineer put it, in order to do one of them they would have to take a an area east of I-95, about a half a mile wide and six miles long, to have enough retention area to do one district’s removal or lowering of the nitrogen to allow it to come out of the water. Space, how to do it and technical expertise are difficult. In our situation it does not become an issue until it leaves us; it goes into the canals, it goes into the drainage and it goes out to a tide. That only occurs when we are under a heavy rain situation and how do you treat, if you have all four pumps going, 200,000 gallons a minute.

Mr. Fennell stated I think those are two additional issues. One is how to even fix it if you knew what it was. The other question beyond that is; why is it harmful? I am not sure that someone just throwing out a specification will necessarily…at this point now what we know is we do not even know of any particular issues here with nitrogen levels. Have there been actual studies done on what the maximum levels are which can be tolerated?

Mr. Cassel responded my understanding from the EPA, DEP and the environmentalists is the issue becomes where we flow into C-14 and into the Hillsborough inlet where it goes to the tide, the potential damage of the bended communities along the coast, etcetera, and the degradation of that.

Mr. Fennell asked someone has tied that to nitrogen content?

Mr. Cassel responded yes; nitrogen and phosphates.

Mr. Daly asked what is their suggestion for remedy? Filter it? There have to be a couple of remedies out there.

Mr. Cassel responded from the information I have seen the EPA has not come up with a remedy per se or specified a remedy. It is; here are our criteria. This is also part of the lawsuit EPA was enjoined in, in the State of Florida. DEP, because we were a descriptive stormwater quality issue on secondary, they wanted a numeric value.

Mr. Fennell stated I like that and I think we are getting a good description of where we are at.

B. Attorney

Mr. Lyles stated I have a couple of things. You asked last month that I investigate the District’s ability to buy a portion of its own outstanding bonds. I talked to bond counsel, Ms. Ganz, about this matter. She, in turn, needed to go to their tax partner to get ramifications of it. The bottom line is unfortunately Federal Tax Law would prohibit such a transaction. Once the District, which is the issuer, obtains title to what are now the bonds out in the investment world it affects a merger back into the District so they are deemed at that point retired. They are cancelled. There is no more interest to be paid. When the bonds come back to the District they are no longer issued. There is no longer an amortization schedule or an interest component so we would hold the bonds, but there would be no interest in the transaction that was hypothetically discussed.

Mr. Fennell stated okay.

Mr. Lyles stated if you think about it for a second it makes sense that the Federal Government would not let people issue bonds, then own the bonds and pay itself interest it raises from its own taxpayers.

Mr. Fennell stated I actually see it all of the time in the Federal Government when one agency owns the bonds of another.

Mr. Lyles stated I do not have an actual example to give you, but I did get an opinion from bond counsel and from their tax counsel.

Mr. Fennell stated which is essentially to retire them.

Mr. Lyles stated they would retire the bonds.

Mr. Fennell stated so if we did that, so what.

Mr. Lyles stated when you asked me the question I said you could redeem the bonds and buy the debt down. You always have that power. The issue was whether we could pay the interest to ourselves and that is what we cannot do. We can certainly go through a process called early redemption in which case we buy back the debt and we wipe it out because we do not need that debt outstanding. I think in some instances what we are talking about is we have issued the debt and we do not need it yet, but we are going to for a capital project and we happen to have at this moment in time a bit of operating revenue that we do not have committed to an operating expenditure. The time is going to come through this construction process where the capital costs require the construction account to fund it. It might or it might not work. It is always possible, and it does occur, where special districts, cities or counties issue too many bonds, the bids come in and the project gets done for less. So do you leave the bond outstanding for 20 or 30 years? No. You buy it back. You pay it down to what you actually need to spend on the project.

Mr. Fennell asked do we have non recallable bonds or non recallable to a certain date?

Mr. Lyles responded there is an annual.

Mr. Fennell stated there is a way we can actually force the bond back.

Mr. Lyles stated yes.

Mr. Fennell stated the second way would be to go into the open bond market and buy them. So we could do that.

Mr. Lyles stated yes.

Mr. Fennell stated why would one do that. We are paying 5% or 6% interest on these things.

Ms. Woodward stated my issue on this is I believe what we have been looking at is the item which has been considered to be unrestrictive net assets and the assumption is that large number is uncommitted for future needs. The truth is that number, which is approximately $8.7 Million right now, 80% of that is already committed for future use.

Mr. Fennell stated I was hoping we could bring them back in and then have them go out again when we need it to. It would be nice to be able to issue bonds every week like the Federal Government if we needed to, but we obviously do that about every ten years and then in a lump sum.

Mr. Lyles stated or in our case 30 years.

Mr. Fennell stated so we cannot just bring them back and resell them, but we could bring them back if I really thought I had money I was never going to use.

Mr. Lyles stated that is called early redemption.

Mr. Fennell stated we found another option.

Mr. Lyles stated the down side is if you determine that you do need some additional capital, there is a cost associated with reissuing the bonds and you do not know where rates are going to be when you decide to do that. They are low right now, but they may not stay that way.

Mr. Fennell stated for some reason, I do not know why, utility costs still pay very well. The premium may be $102 or $103 for a bond or something, but they are paying very well as compared to the Federal Bonds. The only reason I can think of for that is because no one really trusts the local utilities. If you do not know them, I can understand that. I happen to know this one so I know we are in good shape. Thank you for answering that question. I am not sure what to do with it yet, but there is an option we did not know about.

Mr. Lyles stated it is something to continue to look at and then run the numbers. The other thing that came up at last months meeting which I followed up on is to track and report back on any bills of interest or concern that are making their way through the process in Tallahassee. We talked about the one with the referendum requirement for dissolving; not only did we decide it is no harm to us, the Florida Association of Special Districts is actually supporting that bill. It has not passed. It is still going through the system. They are actually supporting this bill. They think it is a good bill for special districts.

Another one I think is making its way through the committee process is Senate Bill 376. It pertains to public notices and advertisements by local government agencies such as this one. If passed, it will allow us to use a publicly accessible website run by the District to meet requirements of law for publishing notices and advertisements; bidding, meeting notices, public hearings and other things. It will be optional, not mandatory, but it will reduce the expense and complexity of putting everything in the newspaper that comes along.

Mr. Fennell stated it sounds like we should start doing that.

Mr. Lyles stated it has not passed.

Mr. Fennell stated yes, it has not passed. It is not a bad thing to do, but I do not know there are actually many people coming into our website.

Mr. Hanks stated you would be surprised at who would take a look at it.

Mr. Fennell stated if it passed, you are right. Someone could use the right software program and would probably do a computer search all of the time.

Mr. Daly stated well even on Google Search you could put down bids in Coral Springs or Broward County and it would come up.

Mr. Hanks stated Ms. Early, your company looks all the time or you have people full-time looking for work, looking at the City of Lighthouse Point, etcetera, to see what comes up.

Ms. Zich stated that sounds like a good idea.

Mr. Fennell stated I do not see any harm in that one at all. It is a good thing.

Mr. Lyles stated I think it is a good thing. It gives us an efficient and inexpensive tool because we are probably at the very bottom of the barrel in terms of state and local agencies in this whole state with cumbersome, burdensome and expensive notice requirements for things we do. It would relieve us a bit of that burden. The last thing I want to tell the Board about is something called House Joint Resolution 493, which is a bill that would amend the state constitution. If passed at a referendum in the fall, it would require any special district or government body that has the power, not that it does, but it has the power in its authorizing document, its charter, or in our case our special act, to impose a millage rate or levy ad valorem taxes. We do have that power. We have never done so, but we do have that power. If this constitutional amendment passes, it would require that members of this Board be elected in a popular election by the electors and not by a vote of the landowners.

Mr. Fennell stated wow.

Ms. Zich stated that would be a big one.

Mr. Lyles stated it has a phase in schedule. Obviously people cannot just change the way they do things over night, but right now it is only scheduled to be January 1, 2013, which is not that far away. First of all it has to pass the legislature. Strangely enough the Florida Association of Special Districts is merely monitoring this bill. It is not opposed to it. It is monitoring it so it is not actively opposed to it. It is one of those things which would probably be difficult to go to Tallahassee and oppose; popular elections in an election year. It has to pass the legislature and then it has to be on a referendum on the ballot in November. The voters have to pass it, but I think you can expect they will. The schedule of phasing then begins.

I believe in our case, if for instance the Board decided that going through the expense and trouble of doing this on a mandated basis as opposed to voluntarily doing it, which this Board has been on record for a number of years as supporting, it would be as easy as amending our special act to take out the ad valorem taxation power. It is a power you have never used in the history of this District. You would still levy assessments the way you do and you can issue bonds. If you did not have the power to actually levy a property tax, you would not be subject to the constitutional amendment. So this is something we have to discuss further before we actually get to the point of actually doing something.

Mr. Fennell asked what about the general fund where we do tax everybody?

Mr. Lyles responded you do not.

Mr. Cassel stated it is not a tax, it is an assessment.

Mr. Lyles stated it is not millage. This is what I am saying. Since you do not and have not ever done it, it seems silly to have us brought within the sweep of this enactment because of a power that is technically in our special act, but one you have never chosen to exercise.

Mr. Fennell stated since we are a built out District this is really not an issue for us. The only reason we really have not done that is because it was going to cost us a lot of money to. We actively tried to get bills passed and they got vetoed by the Governor. I can see where this can be a real issue for developers because essentially developers control the districts because they own the land, but they usually put their land up as collateral to the district.

Mr. Lyles stated it would have a sweeping and dramatic affect on the 550 plus Chapter 190 CDDs in the State of Florida. A lot of those are already run by popular elected boards. They have a transition statutorily imposed on them, but for the first six years it is a landowner election. That would no longer be permitted under this constitutional amendment. It would be an unconstitutional statute because they also technically have the authority, under certain circumstances, to levy a property tax. I have never heard of a Chapter 190 CDD doing that, but because they have that power they would fall under this enactment.

Mr. Fennell stated any land developer would be adamantly opposed to this.

Mr. Lyles stated well their situation is somewhat weakened right now. They are not developing right now in the whole State of Florida with a couple of really minor exceptions. It may be seen as an opportunity to change something, but the fact of the matter is how do you really get a district set up and under way without the ability. They may carve out some kind of an exception by the time they get the whole thing implemented.

Mr. Fennell stated it is a gigantic change for the way Florida develops.

Mr. Lyles stated they can amend Chapter 190, which is the 800 pound gorilla when it comes to new developments because nobody goes through the trouble to set up a discreet special custom district like this one is anymore. This would be a Chapter 190 CDD if somebody were to do it today. The authorizing legislation for a CDD could provide that during the transition from raw land to popularly elected boards, that six year period, the board would have no power to levy taxes. They could only levy assessments. There are ways they can get around it, but it is a big idea and a big change. It is not one I think would be easy to stand up and oppose. Again, the Florida Association of Special Districts does not oppose it. They are monitoring it. Even they are the group that, by far, represents the largest number of districts with landowner votes and landowner elections. Their core constituents are that type of district and they are not opposing this bill.

Mr. Fennell stated I do not know how Florida would actually react. Counties and cities would have to actually step up and do real development or not do it and then it does not get done. That would stop development. Does the person who wrote this really understand the implications? Maybe he does.

Mr. Lyles responded the representative who has filed this bill is Representative Domino and I do not know that name. I cannot give you any information about the sponsor.

Mr. Fennell stated thank you very much.

C. Engineer

· Revised Work Authorization for Reuse Feasibility Study

Mr. Cassel stated we had initially authorized Work Authorization 56 several months ago when we were doing the matching funds for grants. We continued to look into that work authorization and decided the scope of that work authorization exceeded where we needed to go. It could possibly put us into an area where we did not want to go as far as reuse. It could box us into a corner. I went back to CH2M Hill and with Ms. Early and Mr. Morales we reworked the scope. What you have before you is a revision which decreases the work authorization from what I believe was originally $83,000 down to $53,000. We cut out a lot of the design. It had to do with the preliminary design of a reuse facility here for .8 MGD.

Ms. Early stated yes, onsite.

Mr. Cassel stated through discussions at this point in time based upon our process of water reuse permits and other permits, we believe it is probably not a good thing to put us in that box to potentially commit ourselves to building a reuse plant here with potentially no customers or usage for it. This is where we stripped it out. This revised work authorization will also be part of this feasibility study that ends up getting submitted with our permit renewal for the wastewater treatment plant. We have to update it for that as well. It will take care of two items.

Mr. Fennell asked does this talk about reusing the canal water?

Mr. Cassel responded no. This is strictly wastewater effluent reuse.

Mr. Fennell stated that is a small part considering the amount of water that we actually pump out of the canals, including the C-14, and dump in the oceans. If we really want to conserve water, would we not figure out how to use the canal water?

Mr. Cassel responded as I understand it the canal water is considered the surficial aquifer, which you are only permitted to pull a certain amount out of already. Anything that would come out of the canals would also be out of the upper aquifer, which you would be prohibited from using anyway.

Mr. Fennell stated but every year we have more water fall on us than we can actually use. We dump a bunch of it out in the C-14 canal and it goes out. Would the smarter thing be to figure out how to use that C-14 water instead of dumping it in the ocean?

Mr. Hanks responded yes, but we are talking about government here.

Mr. Cassel stated you are also talking about peak cycles. If I remember correctly Mr. Bulman, they a project in Dade County where they were doing two things, probably 15 years ago; one was they were pumping to the Everglades and then back pumping. They had issues with that for phosphorous and then there was another issue where they were going to do deep well injection into a dome and then pull it back for storage and recovery.

Mr. Hanks stated there are environmental issues associated with that.

Mr. Fennell asked is the canal water cleaner than our wastewater?

Mr. Bulman responded yes.

Mr. Fennell stated I remember at one time billions of gallons of water went out to the tide and at most we are talking about 100 Million gallons a year here. It does not make sense that we are not figuring out ways to use perfectly good water and trying to figure out ways to use bad water.

Mr. Bulman stated even when we were doing our groundwater modeling the Hillsborough Canal, C-14 and the L-36 are all considered an impact to a regional water body. That is part of your impact for the overall environment; even though the canal was discharging billions of gallons a day to tide.

Mr. Johnson stated from a treatment standpoint, treatment water is going to depend on what your end use is. If you are looking at an end use of that being potable drinking water, the treatment requirements for that are significantly higher than what they are for lime softening and rain treatment. So pulling it out of the ground and treating it that way is going to be a lot easier. The other issue is you have a lot of stuff in that canal, if you were using it for potable water, which include runoff of fertilizers, pesticides and other constituents you would not want to be bringing into a potable scenario. If you are talking from a non potable reuse standpoint, treating the wastewater here is going to be easier than treating the canal water.

Mr. Fennell stated I hear you, but as far as I can see almost every person who lives on a canal is doing reuse.

Mr. Johnson stated sure, if you have a reuse distribution system.

Mr. Fennell stated I believe they are just pumping it from the canal and putting it in their lawns. It is working. What is your recommendation? Why do we have to do this thing?

Mr. Cassel responded my recommendation is that it takes out approximately $30,000 out of the work authorization and reduces the work authorization from $83,000 to $53,000.

Mr. Fennell asked did we have a previous authorization that we previously authorized?

Mr. Cassel responded yes.

Mr. Fennell asked are we authorizing to spend less?

Mr. Cassel responded yes.

Ms. Zich stated $30,000 less.

Mr. Cassel stated and it is still part of the grant system 50/50 with the county for this. My understanding is we were to be approved last week with the county board on that grant. I have not heard that we have not been approved so my assumption is we have. We will need to go back and notify them that instead of needing the higher amount we will need less money.

Mr. Hanks asked is the scope we are representing here compatible with the grant application scope we presented?

Mr. Cassel responded yes. The one modification is the preliminary design for the onsite reuse facility.

Mr. Hanks stated okay and this is why we have item 11.13. Is that in here? There is reference here that any amendment or modification to the executed Interlocal Agreement shall be in writing.

Mr. Cassel responded that is right.

Mr. Hanks asked is that being covered within this work order?

Mr. Cassel responded yes. We are going to go back to it.

Mr. Fennell asked is there a motion?

On MOTION by Mr. Hanks seconded by Mr. Fennell with all in favor the Work Authorization 56A, amendment to development of reuse feasibility study, was approved.

· Project Status Report

Mr. Fennell I asked for this to be a little easier to read. To be honest I am still having difficulties understanding it; even though there is a lot of detail. I still cannot see the forest through the branches. Do you have an executive summary schedule?

Mr. Cassel responded this is the full detail. Mr. Johnson, can we get it rolled up into a milestone report?

Mr. Fennell responded yes. I had a hard time understanding it. It is kind of like looking up a forest and counting the leaves. I want to make sure the forest is still there. It is okay to have this, but I would like to have something that tells me…

Ms. Zich stated the bottom line.

Mr. Fennell stated yes. Are we one week behind, two weeks behind or three weeks behind?

Mr. Hanks asked what do we need to take away from this wonderful back up material we have? I apologize, but my patience is not sufficient to dive through all of this and digest it.

Mr. Johnson responded that schedule is the contractor’s schedule. What you probably need to take away from it is that CH2M Hill has a difficult time believing that schedule is correct and they have an on time finish.

Mr. Cassel asked which line item would show that on time finish?

Mr. Johnson responded whatever the last thing on the schedule is. I think they are showing a January 2011 finish. Our biggest concern we are looking at is that there are a lot of concurrent tasks which will be happening going forward; mainly when we get to August, September and October where you would have a lot of people working in a confined space around each other. The walls are going up in the membrane building. You have a lot of people working on different components of the same system; electric, IC, HDAC, Building Services and what have you.

Mr. Hanks asked are you saying you have some concerns that the electrician is going to be trying to water the pumps while the plumber is trying to hook them up?

Mr. Johnson responded yes.

Mr. Fennell stated it is good to know somebody has these schedules. Are you saying these came from the contractor?

Mr. Johnson responded yes, Intrastate.

Mr. Fennell asked did they look at them?

Mr. Johnson responded I cannot speak for Intrastate.

Mr. Fennell stated okay. We need a summary of this so we can understand it. I still do not know if I came away understanding. How many weeks are we behind now?

Mr. Hanks responded it does not matter how many weeks we are behind now. It only matters how many weeks we are behind at the end.

Mr. Johnson stated the substantial completion on Wastewater Plant F was April 3, 2010. That was when it was supposed to be. We are now at a substantial completion date of plus ten calendar days.

Mr. Cassel stated as of today.

Ms. Zich stated and we know there are a lot of issues out there.

Mr. Fennell stated during our tour a lot of issues came up regarding several different items. I guess, from our manager here, we need to have you report back to us next time because I did not walk out of there with great feelings. I saw two or three issues I think are substantial. One was a question of the welding. There was a question of the thickness of the material. Unfortunately when I ask our own engineering group what they think is a sound design, they tell me it is not their job to know whether or not it is a sound design. They just write the specifications for what it should be. So I do not really have an answer that says this is a sound design.

Mr. Cassel stated as I stated before, this is one of the reasons why we are having a meeting after this meeting to go through those issues to make sure the District is receiving or will receive what it contracted for through this whole process.

Mr. Fennell stated in walking out of there with concerns, I do not know how severe this problem is.

Ms. Zich stated I did not feel very confident out there either; especially knowing it was supposed to be done on April 3, 2010.

Mr. Johnson stated substantial completion means you have beneficial use of the…

Ms. Zich asked beneficial use?

Mr. Johnson responded substantial completion should mean they have water flowing through that treatment system, it is treating the water correctly and all there is left to do are going to be punch list items.

Ms. Zich asked when will we be able to use it?

Mr. Johnson responded I cannot give you an answer on that.

Mr. Fennell asked how much money do we still have to pay on this?

Mr. Johnson responded we have retainage on it and we also discussed the next steps if we need to hold money back because of uncovering defective work.

Ms. Zich stated I am disappointed with the welding. I would think anyone who knew what they were doing would know that is not acceptable.

Mr. Johnson stated it is one of those things where the contractor is supposed to provide the welding and the QAPC procedures. The codes specifically call for testing, which as we are finding out with the testing we keep requesting it in writing and they have not come forth with testing results. We will discuss this after the meeting today.

Mr. Fennell asked is there anything else?

Ms. Early responded yes. I believe Mr. Bulman wanted to give an update on the wells.

Ms. Zich asked are we totally done?

Mr. Bulman responded no. There lies one issue. The schedule has been slipping. The quality has not been compromised. Their original completion date was October. That was delayed to November 25, 2010 as a result of the dropped tubing which occurred last summer. We are now in the middle of April and if you can look outside when you walk out there, they have the sod down. They are doing site restoration and punch list items. As of this morning the contractor anticipates being completely done the first week of May; including the installation of our submersible pump for the monitoring well. That places them about six months out on the revised estimate. In terms of the product you are getting it is excellent. All of the work which has been done has been specified and observed by us. DEP has so far been clear in accepting everything which has been done. There were a couple of issues on the plug and abandonment of the monitoring well. They were done in accordance with the permit. So it is done now. There were some delays by DEP which probably amount to a month and a half of review time on their part. It still does not get you back to the six months. Other issues were the linearity of the way the work progresses as opposed to doing things in parallel.

Mr. Fennell asked did anyone find out what the flow restrictions were?

Mr. Bulman responded as a part of the current project we have to do an operations and maintenance with a higher injection system. What we have done in the past couple of weeks has been pretty interesting and difficult at the same time; going through District archive records, trying to find out exactly where the piping is. In fact we had help from some staff members who were going up there and using some piping locators so we could truly monitor that system.

Mr. Hanks stated we have a bunch of surveyors who are pre-qualified. Have we been making use of them to help map this out so we know in the future or is that something that you do not think is needed?

Mr. Bulman responded I do not think we used a surveyor; just a District staff member.

Mr. Hanks stated what I am saying is so we can have an accurate record of where things are.

Mr. Bulman stated what we are going to produce from this, because we are not licensed surveyors and we did not locate them, we just measured off existing survey locations, what we provide will have to be labeled schematic. I think it is a good idea for the District to have something done by a licensed surveyor.

Mr. Cassel stated at the same time we will at least have it on written documents what pipe is there or within a couple of feet of where it should be versus what we have now.

Mr. Hanks stated we want to know where it is within a couple of feet and not whether it is on this side or that side of the tank.

Mr. Cassel stated right. I think that is the point we are going to be at when we are finished. I am not sure whether we need a surveyor to survey it in, go with depths and everything else. As we do projects we might do a section of pipes, but at least we know where the pipes are or how many pipes are potentially in that location.

SIXTH ORDER OF BUSINESS Approval of March Financials and Check Registers

· Summary of Cash Transactions

· Projected Cash Flows

Mr. Bloom stated at our last meeting we started talking about the emergency CDs we had. We had five of them we started out with. Out of the five only one is still invested. The other four are either in money market accounts in the same bank or the money has been returned to Wachovia. The first decision we needed was whether the Board wanted us to reinvest all five of those emergency CDs regardless of those poor rates.

Mr. Fennell asked what was the second option you had?

Mr. Bloom responded the second option was related more to some of the other excess money. For some of the additional money we had talked about CDARS, which had some better rates at the time. That has changed since the last meeting. That is the bad news. The rate has gone down. We have contacted Bank United, which has a local branch here, and they are willing to offer a money market account for 1.35%. This is better than what we were seeing in the CDARS. This would allow you to withdraw money, I believe it is six withdrawals a month, and gives you the same protection you have with Wachovia. That is the best rate option I can provide you with right now. CDARS are still available, but unfortunately the rates are still going in the wrong direction.

Ms. Zich asked what rate do we get for the money market account with Wachovia?

Mr. Bloom responded you are getting less that .5% right now. You would be able to move some of that money into a money market account with the same access as you have with Wachovia, the same protection and will give you the same interest you are going to get with a CD, and with a CD you have it tied up for 12 months.

Mr. Cassel stated I think you also need to point out the issue which has been occurring as we have been moving dollars to different banks.

Mr. Bloom stated yes. Every bank has their asset level they want to have when it comes to these deposits. What we are seeing is some of the banks are saying they do not want any more deposits. This is why we are constantly reaching out to different banks. As you can see with Wachovia, SunTrust and Bank of America, the larger banks, their rates are close to zero now because they are not interested. Some of the smaller community banks have the better rates because they are looking at some of the deposits and that is their incentive to get in some more deposits. With some of these smaller banks, when they have reached their saturation point, they kind of cut you off at that point too.

Mr. Fennell asked what do you recommend Ms. Woodward?

Ms. Woodward responded I would like to know if Bank United has a minimum requirement for a minimal deposit.

Mr. Bloom stated they request you open up a checking account. It is a free checking account. You put in a small amount like $1,000. We are still working with Bank United to maybe get some longer term CDs that are breakable. If we can get a stronger relationship with them, it might be something we can work on. This is something I wanted to present and see if it would maybe clarify things a bit.

Ms. Woodward stated in the water and sewer fund, in these undesignated funds which have been committed for future use, some of these future uses are spread over the next four years with the increase in principal that is coming up on our bonds. We are talking about $4 Million we cannot spend any other way that we could potentially put in there with no trouble and earn just 1.35%.

Mr. Bloom stated if there is something you do not believe you will be spending for two years or three years, we can look into longer term CDs. Most districts do not because their cash flow is much tighter, but I can see if I can bring back some longer term CDs for some of that.

Ms. Zich stated these rates were so low there is no point in tying up the money if you can get it for 1.35%.

Mr. Bloom stated exactly, but if you can get something for two and three years, my suggestion is you put some of it into this money market account. You can always pull it out if you wanted to do something else.

Ms. Zich stated it is liquid, which is great and we can earn more interest.

Mr. Bloom stated it is not as liquid as a checking account.

Ms. Zich stated but we are not going to use it as a checking account. Ms. Woodward would be taking it out, maybe, once a month, if that much.

Mr. Fennell stated so let us make a motion to do it.

On MOTION by Ms. Zich seconded by Mr. Hanks with all in favor the Board authorized Mr. Bloom to check into Bank United and if the District can obtain 1.35% to move some funds to be determined by Ms. Woodward into a money market account with Bank United.

Mr. Bloom asked with regard to the five emergency CDs, do you want me to invest them into the five local banks?

Mr. Fennell responded talk with Ms. Woodward. If this money is going to go into the money market account, then at that point if we have a certain amount of money you say is two years out or four years out, then at that point we look for CD rates, but they are going to have to be in the 2.5% or 3% in order to be worthwhile of doing.

Ms. Zich stated but he said they dropped and they were less than that last month.

Mr. Fennell stated even so there are at least two year T-Bills that probably have at least 2%.

Mr. Bloom stated I am seeing that a one year T-Bill right now is .3% or .4%.

Mr. Fennell stated that is one year.

Mr. Bloom stated two year is better.

Mr. Fennell stated there is a three year too.

Mr. Bloom stated there is a three treasury note. We can look into that.

Mr. Fennell stated we can buy T-Bills if it is two or three years out.

Ms. Woodward stated part of the concern on that is our discussion right now is centering on interest rate. The purpose of putting this money aside was not for the interest rate. It was for the safety of working capital should there be a leveling of this campus during a storm. We would want to be in a position to basically locally go out and secure cash to run this District for a two month period for both the general fund as well as the water and sewer fund if something catastrophic happened. The initial concern on those five CDs, which were $1.25 Million total, was strictly for operating cash. We were willing to at least entertain a slightly lower interest rate in order to have a safe and secure piggy bank we could access immediately should the need arise.

Mr. Bloom stated if we have the money market account, which can be counted as one of the CDs. Then First Southern still has a good rate, which would be two. Really what you are deciding on is whether you want the other three to still be CDs for the emergency or do you want to pull them back and put them into a money market.

Mr. Fennell asked what is the rate?

Ms. Zich responded the rates were terrible.

Mr. Bloom stated one of the banks was .18%, but again, it was not about the rate. It was about having somebody within a driving distance where you could pull that CD out and have it available in the case of an emergency.

Mr. Hanks asked what were the amounts we were talking about Mr. Bloom?

Mr. Bloom responded right now we are talking about $750,000 from three CDs.

Mr. Hanks stated so a portion of these things were not being covered by FDIC anyways.

Mr. Bloom stated they were being covered by the Florida Collateral Pool. That is what happens. Anything over $250,000 gets fully covered by the Florida Collateral Pool.

Mr. Hanks asked are we taking a risk by putting it into a local money market as opposed to having it from the other bank?

Mr. Bloom responded you are not changing the risk; however, if something were to happen to Bank ‘X’ you could go over to Bank ‘Z’ and that bank should have no problems.

Mr. Fennell asked so what is the question to us?

Mr. Bloom asked do you want to still have those three CDs, up to five, so five separate banks that you would have cash available locally?

Mr. Fennell asked what do you recommend?

Ms. Woodward responded I recommend we do it, but we also have one other thing we could consider on this, which is the likelihood of us actually needing this is pretty slim. As a result of this I do not have any problem in setting this up in a two or three year CD if you can get a more beneficial rate because on the off chance that you ever needed it we would be willing to give up and forego some of the interest we would have earned in order to have access to those funds.

Mr. Hanks stated and honestly if you have a catastrophic failure like a hurricane which wipes out this plant, you are going to be seeing a Federal disaster area and there will be other opportunities for loans or whatever to help get us back on our feet.

Mr. Fennell stated it seems like the input is come back next time. Look at two or three different options; whether they be CDs, T-Bills or whatever it is and give us a comparison.

Mr. Cassel asked do you want to drag it out for another month or do you want to put forth parameters and say if it is within this set of parameters, let us get it in there.

Ms. Zich stated let us set parameters. You guys know now what we want.

Mr. Fennell asked so what are you thinking?

Mr. Cassel responded direction from the Board to get the money invested into the different banks within the parameters discussed.

On MOTION by Ms. Zich seconded by Mr. Hanks with all in favor the Board authorized District staff to invest funds within the parameters discussed.

Mr. Fennell stated we are basically trusting you, Ms. Woodward and Mr. Cassel to make the best decision.

Mr. Cassel stated we will report back with where they are.

Mr. Fennell stated I think the economy is in better shape than it was six months or a year ago. We are not out of it yet. There are still 10 Million people out of work; however, I think the banks are sound now and I do not think they are going to let them fail. A year and a half ago that was not true. Banks were failing, but I think we are in much better shape now. Okay, check registers. Does anybody want go through this?

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

SEVENTH ORDER OF BUSINESS Adjournment

There being no further business,

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

Glen Hanks Robert D. Fennell

Secretary President