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, November
13, 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
Jane
Early CH2M
Hill
Sean
Skehan CH2M
Hill
Brenda
Schurz Severn
Trent Services
Dan
Daly Director
of Operations
Jim
Aversa Chief
Operator, Wastewater Plant
Doug
Hyche Utilities
Director
Randy
Frederick Drainage
Supervisor
Kay
Woodward District
Accountant
Jan
Zilmer Human
Resources Manager
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 October 20, 2008 Meeting
Mr. Fennell stated each Board member
received a copy of the minutes of the October 20, 2008 meeting and requested
any corrections, additions or deletions.
Mr. Fennell stated the only thing I
have is a correction on page 27. It is
not $3.2 Million. It is $3.2
Billion.
Mr. Hanks stated in the same
paragraph, I am not sure what we mean by “the lining of trees.” Do you have any idea?
Mr. Fennell responded yes. It is supposed to be lining of the pipes.
Mr. Hanks stated I would like to
change the order of two words on page two.
The sentence stating, “Mr. Hanks stated you will get a couple of
gallons, test them side by side and see how it goes.” It is a question, “will you “and not “you
will”.
On MOTION by Mr. Hanks stated by
Mr. Fennell with all in favor the minutes of the October 20, 2008 meeting were
approved as amended.
THIRD ORDER OF BUSINESS Consideration of
Resolution 2009-1, Amending the General Fund Budget for Fiscal Year 2007-2008
Mr. Fennell asked is this last
year’s budget?
Mr. Daly responded yes.
Mr. Cassel stated at the end of
every budget year you do a balancing amendment.
You put in the line items and throughout the year you may have to do
some adjustments from one line item to another line item. It does not impact the bottom line of your
budget, but it is a budget amendment to do the adjustments.
Ms. Woodward stated you will notice
we chose seven or eight specific line items in the fiscal year 2008
budget. We did not go line by line for
every last little item. We decided to go
through and on the specific expenses where you were able to reduce through
negotiations or watching our expenses throughout the year where we had
literally saved real dollars in the budget, we decided to take those items,
take the excess and show it as a reduction of those expense lines and transfer
them into reserves. One of the things
over the past few years after the various hurricanes we had was the concern the
District wanted to build up reserves for emergencies and for hurricanes.
Last year we had initially indicated
we were going to fund an extra $301,000 into a designated reserve we wanted to
have available. This would have brought
our balance on December of 2008 up to approximately $875,000. In addition to this, the $426,000 we are
moving out of the other line items will allow us to bring it up to $1.3 Million. It will allow us to bring to you, within the
next couple of months, the program plan for what we believe will be the overall
way we need to address any emergencies as well as future expenditures.
On MOTION by Mr. Hanks seconded
by Ms. Zich with all in favor Resolution 2009-1, amending the general fund
budget for fiscal year 2008, was adopted.
Mr. Hanks stated thank you for
putting those into the reserve. I feel
much better knowing we recently completed a hurricane season and now have $1 Million
in the bank for future issues.
FOURTH ORDER OF BUSINESS Staff Reports
A. Manager
i. Annual and Monthly
Water and Sewer Charts
Mr. Cassel stated you
will notice the water supply reports, water loss projections and water billed.
Mr. Hanks stated Mr. Hyche, clue me
in on the September hardness.
Mr. Hyche stated go by the left
column. It is not the right
numbers. That was raw water which did
not get put in. Your hardness on that
was basically 80 mg/l.
Mr. Hanks asked is the maximum
permitted 100 mg/l?
Mr. Hyche responded yes.
Mr. Hanks asked what is the raw
water ph? Do you know approximately?
Mr. Hyche responded 7.2, 7.1, 6.9
mg/l.
ii. Utility Billing Work Orders
Mr. Hanks asked Mr. Daly, are you
happy with the number of mis-reads we have been encountering?
Mr. Daly responded I would like them
to be zero. We really have to look at
the fact there are 9,500 bills out there.
It is not too bad of a job. To be
honest with you, one of the guys figured a place was empty for three months and
it was going to be the same reading. It
turns out it was not the same reading. We
had that this week. You know, they get a
little sloppy and you take them to the side and talk to them. For the most part, it is not that bad.
Mr. Hanks stated I see they came
down from where they were in 2006.
Mr. Daly stated overall, it has not
changed much when you look at the questions requiring re-reading; if you look
all the way across the Board.
Mr. Hanks stated in the last four
years you have been staying between 40 and 60.
Mr. Daly stated if you look over
last year, August of 2007 went up. What
went in? New rates.
Ms. Zich stated the new rates went
in this year too. Nobody questioned us
this year.
Mr. Daly stated maybe it is because
everything else in the household went up too this past year.
B.
Attorney
Mr.
Lyles stated it has been a quiet month.
I have nothing new to report.
C. Engineer – Monthly Project Status Report
and Charts
Mr. Skehan stated as of yesterday
the contractor informed us all the testing on the construction is scheduled to
be completed December 1, 2008. It will
be substantially complete at this point.
This is the current construction project, which is ongoing right now.
Mr. Hanks asked is it the wastewater
plant?
Mr. Skehan responded the wastewater
plant. This work is very close to being
complete. They are working on punch list
items. We are going to get a formal
punch list as we get closer to the end. We
discussed all of this yesterday. The
contractor is being cooperative and helpful along the way. This is Intrastate Construction
Corporation. The bidding of the water
plant work is underway.
Mr. Fennell asked are we out to bid?
Mr. Skehan responded we are out to
bid. A prequalification list was
completed. We started out with a list of
approximately 20 contractors who called and expressed interest. There were contractors from all over the
map. The list got whittled down to ten
who requested the package. We finalized
the list of qualified contractors to six of the ten who requested the packages. One of the ten was a roadway contractor, a
very large contractor, but from the Midwest.
He did not really know what it was.
They were not qualified so they had no RO projects. Another local contractor was an asbestos mitigation
firm that was interested in bidding the work.
We said their qualifications do not have anything related to water plant
work and RO work. This is the range in
differences we saw in contractors through the whole process of whittling down
the number of contractors; ultimately down from 20 to 6. It worked out very well.
We have six contractors we feel are
qualified. All of them have worked in
water plants before. They have RO
experience. They are all local; from
Southeast Florida for the most part. We
are proceeding with the bid. The bid is
scheduled to be received on December 9, 2008.
The Board meeting is December 15, 2008.
Our goal is to have a recommendation to the Board and to Mr. Cassel
before that weekend. There was a
significant ground swell of requests to have the bid extended from four weeks,
which was going to be placing it two days before Thanksgiving, and they needed
an extra week or two. We are giving them
two extra weeks to be able to bid out the project, make sure they have adequate time to compile
all of the numbers they have and at the same time not have any reason to say
they did not have enough time to bid.
We have the bid package put together
for the new monitor well and the testing which will be required for it. DEP has that package. We are waiting for one final response from
them. This package will probably be out
to bid the beginning of December. I
think you can anticipate for the December Board meeting that we will try to
have a services during construction authorization
for your consideration. We will be able
to keep moving with the project. The
goal on the construction plant work for both water and wastewater works is to
have this underway by mid January to the first part of February for the notice to proceed.
Everything we have seen with other
projects which have been bid, this is from our construction people, is there is
a great interest in the market as the 20 contractors we saw. The price of materials has come down. The price of fuel has come down. The price of labor just for contractors to
maintain their workload to keep their people busy. I think we are going to see good bids.
Mr. Fennell asked when did we do the
bond issue?
Mr. Skehan responded September a
year ago.
Mr. Fennell stated okay, so
essentially we have had the money around for a year. At that point we were looking at the price of
cement and other things from a year and a half ago.
Mr. Skehan stated those prices have
certainly adjusted. PVC, any kind of
piping, stainless steel, reinforcing rods, concrete block, copper for
electrical components; all of those things wrap up into panels, wiring and
motors. It is a good time to be bidding
a project.
Mr. Hanks stated that is all good
with the bidding. Where do we stand with
the city?
Mr. Skehan responded we were advised
today that they completed the review.
They are returning it to us on Monday.
They have a couple of questions on ADA issues, disabled access. This is what we were told today. It is fairly insignificant. We already have the permit from DEP for the
wastewater work. We already have the
permit from Broward County for the wastewater work and we also have the health
department checked off for permits.
Mr. Hanks stated that should be
fun. You say that is it. You brought something through with that ADA
comment from the City of Coral Springs. You
are going to have fun.
Ms. Zich stated I agree. You cannot say things are going well until
you have them in hand.
Mr. Skehan stated we will cross that
bridge on Monday.
Mr. Hanks stated at the last meeting
I requested you provide Mr. Cassel with a listing or schedule of what
transpired as far as the other plant.
Mr. Skehan stated we have not
completed it as of yet. Mr. Cassel and I
spoke about it and we will definitely have it wrapped up for you.
Mr. Hanks asked do we need to have a
meeting with the Assistant City Manager so we are all on the same page as to
what their expectations are as far as permitting?
Mr. Skehan responded we will wait
until Monday to see exactly how extensive these are. They were, thus far, pretty cooperative. They were forthcoming with what things were
and how things were. It has been about
three weeks since they had the package so it is a fairly good turnaround. It was an extensive package they had to look
over.
Mr. Fennell asked we do not have to
spend the money if we do not need to, do we?
Suppose the bids come in at $33 Million and we actually went out for $34
Million, we just have to build what we are supposed to build. Is that right? As far as the bonds go.
Mr. Cassel responded that is
correct.
Mr. Daly stated by the way, to put a
feather in Mr. Skehan’s hat, he came to the rescue of the city through me and a
couple of other people last week. They
were screaming because they had something which had to be in. Mr. Skehan was the one who had the answers
for them.
Mr. Skehan stated it related to some
of the modeling work. We were able to
establish a relationship with Mr. Michaud over at public works. He called.
I missed his initial call. He
called Mr. Daly and Mr. Daly got a hold of me.
Working with their other engineer, Mr. Eckler, he had questions for us
that we wanted to work out. They tied
into both CSID and ultimately NSID.
There was information we had.
Mr. Daly stated you came to the
rescue for them. They had a time
constraint.
Mr. Skehan stated it related to
their water use permit and tied to per cavity use, the population expectations
and their capacity demands.
Mr. Hanks stated every couple of
years The Board of Community Affairs, or someone at the state level, require
cities to provide them with an evaluation and appraisal report, which is based
on their comprehensive plan. When they
do these updates they have to contact the water service providers.
Mr. Skehan stated the questions were
straight forward and we were able to answer them straight forward. Our modeling work tied into this also, which is
for CSID, the City of Coral Springs and NSID.
It is proceeding along fairly well.
We expect to have it wrapped up by the end of December, but not
earlier. We will have some clear idea of
what the requirements will be from the South Florida Water Management District
and how all three of the different utilities will have to either bow down to the
South Florida Water Management District and/or what the requirements will be at
the time.
Mr. Fennell stated we have not had
that meeting yet.
Mr. Skehan stated no we have
not.
Mr. Fennell stated we keep holding
that off. Do we have to get this
together?
Mr. Skehan responded that is the
best thing to do.
Mr. Hanks asked when you say “bow
down” with regard to the South Florida Water Management District, what do you
mean?
Mr. Skehan responded wait to see,
number one, what they will be looking for as a result from the modeling and
base a response on it. So often they
have taken an awful lot of, “you have to do this, you have to do that,” and
everything is with the Floridian Aquifer.
You cannot have anymore surficial aquifer. There seems to have been, over the past month
or so, some retreat from their advocacy of requiring utilities to go to the
Floridian Aquifer. There is a greater
emphasis being placed on the credits, one-to-one credits potentially, with
reuse which helps to elevate the viability of being able to reuse where in the
past you may not have gotten the one-to-one reuse ratio. If you get one gallon of water reuse, you
will get one gallon of credit from the surficial aquifer. That is very positive. In the past it might be a half of a gallon or
a quarter of a gallon. There was really
no clear form with what they were doing.
When they start talking about one-to-one ratio, it is much more
beneficial for any utility out there which is looking for surficial aquifer
and/or are required by DEP to implement some level of reuse.
Mr. Fennell asked how does the City
of Coral Springs do this when they do not even process their own water? What are they going to reuse?
Mr. Skehan responded that is where
the South Florida Water Management District has tried to promote some
regularization in this particular area.
We will see how the well field withdrawals unify, looking at the holistic
approach instead of separate; how it really looks with the South Florida Water
Management District. They will put something
on a map over this region and see what the effects really are.
Mr. Fennell stated it sounds
good. Is there anything else?
Mr. Skehan responded there will be
some things coming to you in the next Board meeting. We will have a bid, I believe, at that time
which will be ready for you to take a look at.
Mr. Fennell asked do you have an
actual model we can look at when we go through and talk about where we are
going to spend our money?
Mr. Skehan responded
absolutely. What do you want to see models
on?
Mr. Hyche responded individual
components.
Mr. Fennell stated make it simple
for us.
Mr. Hanks stated we are not talking
$35 Million to $40 Million for a model.
Mr. Skehan stated the project, we
are hoping, is more in the lines of $22 Million to $24 Million. Just for clarification. There is other project work going on which is
taken from the total also. The current
construction work, which is part of the bond work, is approximately $7
Million.
Mr. Hanks asked have we reached an
agreement with the city with regard to the berm and the sign off?
Mr. Cassel responded there is no
hold up on the sign off on any COs or anything with the current projects we are
using. The balance of what landscaping
on the perimeter for the entire site will have to be accomplished with the next
project. There is no hold up on getting
the COs. What is our CO date for the
chemical building?
Mr. Skehan responded we have the knock
box in and the wiring all done for it. The
inspection is next week so the CO will be by the end of the month.
Mr. Cassel stated good.
Mr. Hanks stated the stormwater
management permit you brought before us last month was turned over to Mr.
Eckler. Where does it stand?
Mr. Cassel responded they requested
additional information. There was a
breakdown in the flow of information back to Mr. Eckler. We have it for him. We should have a response by the end of next
week.
Mr. Hanks asked did anyone pick up
in the paper that FEMA is requesting a reimbursement from either Delray or Boynton
Beach?
Mr. Daly responded Delray
Beach. They are requesting $500,000.
Mr. Hanks asked are we in good
shape? Do we have any concerns?
Mr. Cassel responded I will have to
look back and check.
Mr. Hyche stated not that I am aware
of. I have not gotten any feedback or
any emails.
Mr. Hanks stated there was an audit
performed based on the cubic yards coming into their processing center as
opposed to cubic yards actually leaving the center. The disposal was based on basically fluffed
up cubic yards.
Mr. Skehan stated they are talking
about going back to the contractor for reimbursement, but the likelihood of
that is slim to none.
Mr. Hanks stated I see the Mobil on
Atlantic Boulevard and Coral Springs Drive is back open for business. Did they go ahead and put in the required
exfiltration trench?
Mr. Hyche responded I guess. We never got the plans.
Mr. Daly stated we got them
today. Ms. Phillips talked to the young
lady today. She told us to send out the
information and they will get a check out to us for the permit. They are open. The city did nothing, but they will have it
certified with us.
Mr. Hanks stated so the city is not
upholding their end of the bargain, which is they should not be allowed to
reopen without a stormwater certification.
Mr. Daly stated it is probably the
first time they heard of it. They would
have had to check.
Mr. Hanks stated this is one of the
things I would like to put on a list of things to discuss with either the
building official or assistant city manager.
Mr. Daly stated Mr. Frederick, Mr.
Cassel and I were speaking about this. Because
it is a French Drain System, if we are going to ask that everyone certify and
have it looked at, it will probably double the list we currently have that was
put together by CH2M Hill because they do not actually empty into our canal
system. They empty into the ground,
which eventually ends up there.
Mr. Hanks stated exactly and it is
important we address all systems. We
have the responsibility delegated by South Florida Water Management District to
be a reviewing agency for all projects under 40 acres.
Ms. Early stated whether it
discharges or not.
Mr. Hanks stated we as a government
body are responsible for ensuring, for example, the water quality is provided;
that the adequate flood attenuation or onsite retention for your larger storms
is met. In individual projects, even if
they do not discharge directly into a canal, if those systems are not
maintained they will clog up. The
pollution remediation which is afforded by different mechanisms will sit
there. The end result will be localized
flooding and water quality issues.
Mr. Daly stated which eventually
ends up in someone else’s drain.
Mr. Hanks stated the other point,
especially in a gas station, if you eliminate the catch basin so with the
slightest bit of rain it fills up, it overflows it. Where does it go? Right into the city’s street system, which
goes right into our canals.
Mr. Daly asked so did we have any
questions on this? We were wondering if
we had any legal grey areas on this.
Mr. Cassel responded if we are the
review agency, we need to work with the city to make sure we have this in their
process.
Mr. Daly stated we will go back and
review all of the drainage areas which we did not submit a letter for. Right now we have put out 90 letters and 46
responded with money, which means they are well along the way; actually with
permits. So they are in process and we
are making some headway on it. We will
probably double what we are going to do and it is not a problem.
Mr. Hanks stated and that will be
one other item I would have a discussion about with the city, which is to find
a way because we do not really have any hammer, shall we say, to enforce these
regulations. We will be looking to the
city to help us enforce the water quality requirements, which affect everyone
in the city.
On the investment side of things, I
heard about Broward County tax certificates.
Is this something we can make an investment in or is it not on the
approved list?
Ms. Woodward responded I would not
suggest it. How it works is when March
passes and a person has not paid their real estate tax bill for the year, it
goes into delinquency. They will put the
tax certificate up for sale. Broward
County does not care who they collect those taxes from. Typically, investors will come in and pay the
certificates for a particular group of properties or a single property. They pay whatever those taxes are. The taxes related to us get remitted to
us. If the homeowner wishes to take care
of it so they do not lose their property, they will pay back to the county the
taxes which have already been paid by a third party with interest. It is a way for investors to make a higher
interest rate than they would normally make.
By the same token if you do not know what you are paying taxes on, you
can have a property which has heavy pollution and needs to be cleaned up. No one is going to pay it back and you are
stuck out of pocket for money for a long time.
Mr. Lyles stated there are a lot of
complications. Complication number one
is you may recall from time to time we have approved an investment plan and we
use the most conservative state approved investment vehicles. Even those have proven not to be as secure as
we thought. In order to make the kind of
investment with the operating funds we are discussing, we would have to prepare
and submit an amended plan to the State of Florida so they can approve and
qualify it for this District to undertake.
The whole question of whether we are really allowed to be in that
business under our special act powers would arise at this point. While in the past, as Ms. Woodward says, this
type of investment has been a way to make money when the homeowner comes in,
corrects it and pays interest, currently it is more a matter of getting title
to property you want to do something with.
That is outside the scope of our authority.
FIFTH ORDER OF BUSINESS Approval of October
Check Registers
Ms. Woodward stated due to the fact
this month was shorter because we are having our meeting earlier the financials
were not ready by the time the agenda book went to press. They will be with next month’s financials.
Mr. Fennell stated I did see
something from US Bank.
Ms. Woodward stated I told them the
Board needed information in order to have an in depth discussion of plans they
want to make financially. Those are the
questions I sent to him and those are his responses. He is addressing how the bond funds have been
invested. It has nothing to do with our
operating cash sitting in Wachovia or any of our money market funds we have set
up over the past year. This is strictly
how the bond funds were taken care of. At
the last meeting Mr. Fennell asked for a general idea as to what the investment
involves and how it typically works.
This letter is a response to that.
Mr. Fennell asked so our $40 Million
is at US Bank, is this correct?
Ms. Woodward responded yes.
Ms. Zich stated that part is in good
shape. It is Wachovia and the money
market we are concerned about.
Mr. Hanks asked what is this on the
First American Funds?
Ms. Woodward responded this happens
to be the investment US Bank uses for your bond fund. According to what Mr. Schuhle says in the
letter, it is my understanding that it is initially scheduled to end at the end
of December.
Mr. Hanks stated there was a school
in Wisconsin or Minnesota which was really messed up with unusual
investments. Are you concerned that,
with the way these are invested, in six months or a year from now the funds
will not be available?
Ms. Woodward responded my caveat is that
I am not 100% familiar with exactly how the fund works. I am comfortable it is tied to the US
Treasury Temporary Guarantee Program and that we are basically with one of the
strongest banks. My area of expertise is
not on the investment side. I will have
to read up and catch up to understand how it works. My real concern is on the operation side
where we have funds in money market accounts with Wachovia. Because of the way the market is right now,
of course with what is happening with various financial institutions, the
concern has been as you recall from the last meeting where Severn Trent
included a letter on the overview of how Qualified
Public Depositories work, one of our concerns is if Wachovia or, if we were
with another bank, another bank fails and we have CDs locked up with them, how
long before we can unlock the fund and have it available for operations. A good idea for us to address this concern is
to sit down with pencil and paper and say, these are the monies we are going to
need over a 45 day period and a 90 day period and we need to know that we can
get our hands on it and protect it while other things are being processed.
Mr. Hanks asked would this be
accomplished by spreading our accounts between different institutions?
Ms. Woodward responded you can, but
one of the odd things about the new FDIC insurance is they bumped up the
limitations and they go back to the old limitations a year from now. I would like to make the assumption we will
stay with the lower limit and get it lined up in about five or six banks so I
know I can operate for two months. You
can probably select a handful of banks where you are comfortable that if you
put it in an FDIC insured vehicle, you are covered. The issue is not that it is safe. The issue is it is safe, but when will I have
access to it. The fact I can protect $4
Million is great, but if I need $1 Million of it over the next three months and
I cannot touch any of it without filling out paperwork and waiting four months
to get it, it becomes an issue. I think
we need to get a game plan on this and we really need to put it in force. The truth is you are not going to select the
perfect plan. The point is you need to
plan and get started on it. We will fine
tune it as we go.
Mr. Fennell stated we probably need
two cash flow analyses. One for the
project; what will be the projected funds we will need to disburse according to
the construction schedule? Then we need
to have cash flow for our operating side, which is what we are talking about
now.
Mr. Hanks stated keep in mind we
will still be acquiring revenues in through our rates. That is still coming in periodically. The other issue I see, where we have a big in
source at one point and time being November, December and January, is our
general fund.
Mr. Fennell stated but the outflow
is different. Generally what we are
looking for here is more like a conservative projection for operating. Even though we are in the utility business,
our in flows go up and down based on nothing more than watering of lawns. During a recession we can end up with many
people not paying. We had so much money
already in there and we already know what the project expenses are. How much money do we have? Home much will we need in the next 30 days,
60 days or 90 days? Maybe we can buy a
T-Bill for a year or two years.
Ms. Woodward stated the projects are
already covered by the bonds. You have
approximately $33 Million which is already on deposit in the construction
account with US Bank. That is basically
what is going to be paying for the new plant we will be starting shortly.
Ms. Zich stated we are not concerned
about that one.
Ms. Woodward stated no.
Mr. Fennell stated but we still need
a cash flow analysis for it.
Ms. Zich stated but that bank we are
good with. It is the operation side we
are wondering if we should diversify and where to move the money. Mr. Cassel, do you have any suggestions? Do you have people working on this at Severn
Trent?
Mr. Cassel responded we are looking
at this in a number of districts; which banks do you believe are the
safest? That is, in some respects,
anybody’s guess. Typically, you give a
selection of three to five banks that appear to be the most solid and then let
the District choose which ones are their choices.
Ms. Woodward stated the issue now is
not how much interest you will earn or not earn. The question is whether the principal will be
there.
Ms. Zich asked speaking of that, did
we get any place with SBA over the past month?
Ms. Woodward responded we got
$2,600.
Ms. Zich stated talking about
putting money some place and not being able to get to it. Look at this.
We are under $200,000, right?
Ms. Woodward responded yes. I think we are at approximately $150,000.
Ms. Zich stated this is like pulling
teeth and this is the state we were sure about where we were putting our
money. This is why it is so scary.
Mr. Hanks stated I think we should
split the operating fund between three different banks and roll with the
dice. For the amount of money we are
considering, government guarantees are not going to be there. Who knows which one is going to go where and
who knows which bank is going to merge with which bank.
Ms. Zich asked how do we know what
banks are the good banks to be putting it in?
I heard an awful lot of stuff about Wachovia’s bad mortgages.
Mr. Daly responded you are going to
hear things about everybody else.
Mr. Fennell stated what you do with
the money you can put out there is you go out and buy T-Bills. At that point you are just believing in the
United States. After that, the only
thing you can do is buy gold.
Mr. Daly stated if we are trying to
attack our cash flow for a three month period of time, we are using about
$880,000 a month. My understanding is FDIC
is guaranteeing up to $250,000. If we
open three accounts in three different banks, we will be triple covered. We still have $750,000 to $800,000 coming in
our water and sewer operating fund. We
can pretty much leave it alone and see what happened out there.
Mr. Fennell stated we really do not
project using any of the money we have set aside with the upcoming funds. We can do a cycle analysis. We project our income. I believe $5 Million to $6 Million is the
amount from one account to the other.
Ms. Woodward stated yes. We have $4.2 Million in water and sewer and
the balance is in the general fund. The
balance in the general fund represents what we were just talking about. We want to make sure we protect it because we
worked hard to get it there.
Mr. Hanks stated if you take a look
at the reserve fund, it can take many different forms. If we spread it among different institutions
and recognize there is a risk out there, we are being prudent and reducing the
risk. We cannot eliminate it.
Mr. Fennell stated if we were really
going to be super concerned, I do not think anyone can pick the right
banks. The right thing to do is figure
out how much cash you really need to have flow.
We will put that amount into these accounts. After that we will buy three months, six
months or one year of T-Bills. There is
no good reason why we should not do that.
I cannot think of anything safer.
I guess we could buy yearly T-Bills.
Ms. Zich asked how are the delinquencies? How bad are the delinquencies? If someone owes us $200 in back water bills,
do we ever collect that $200?
Mr. Daly responded we usually
collect it. I say this with pride. We are pretty ruthless because Mr. Smith and
Mr. Jones are paying their bills regularly and never default. We are doing it for them.
Ms. Zich asked how bad are the
delinquencies right now?
Mr. Daly responded we put out 900
door hangers between two districts because we mesh our employees. Last Wednesday we turned off 185 people
between the two districts.
Mr. Hanks asked in one day?
Mr. Daly responded in one day for
the month. This is double what the norm
was a year ago. Our highest shutoff days
usually had 40 in CSID and 45 in NSID. There
are probably 60% more renters in this mix than there used to be. It is tough out there. We probably spend 30% to 40% more of our time
on a weekly basis looking after the delinquencies. It has become a full-time job and we are
still doing it with the same staff. It
is a matter of priority number one.
Ms. Zich stated I just wanted to see
if we lost the money.
Mr. Daly stated no. Mr. Lyles, Mr. Cassel and I had a
conversation recently about this. There
is a trigger mechanism of sorts that says when a place is sold they have to
contact the District to see what is owed.
We go after the title company or we ask the new owner to do so. They have title insurance. This should have been taken care of. When it is a rental situation and the renter
leaves, we say it is part of the property and you are using the property as a
business. They still owe us the money
before we turn it back on.
Ms. Zich stated okay. I wanted to make sure you have that. With this many people it is a lot of money.
Mr. Daly stated the whole idea we
were able to go with credit card payments is a lifesaver. The fact we are close to the public has been
a life saver too because we would probably need three extra employees just to
talk to the line of people at the counter.
Everything is done over the phone or the internet. It is really easy and the good part is if
they owe a $200 bill, they can call “Uncle Bob” in New York with a different
last name and we will still take their payment on our website because they will
notify us in two days if it is fraudulent.
We take pride in the fact we painstakingly pay attention to every
account out there.
I recently received a listing of the
house foreclosures in our District as well as NSID. We are going line by line to see how many of
them are rented. If it is in
foreclosure, the renter is going to eventually leave because he is paying the
rent to the owner who is just pocketing the money. It has seriously become a full-time job, but
we do it with a smile on our face. We
just put out another 40 of them for CSID yesterday and another 60 for NSID, this
is just for renters who are behind, for shutoff next Wednesday. We expect to put out another 800 to 900 door
hangers. We do this the last week of
every month and we shut off the first Wednesday of every month.
With our economy the way it is going
it is not going to get any better. Mr.
Cassel and I were speaking this afternoon about arrangements with some old
property owners, not renters, if they need to have it. It is the holiday season and these are
supposedly long time customers. The fact
is they cannot really go anywhere else.
You have to look at it one by one.
Unfortunately, it could become you get the nod and you do not. We do not like to enter into this, but there
are circumstances sometimes when we have to look at it that way.
Mr. Fennell stated I think the input
from us is we would like to see a cash flow analysis next month. The general idea is to look at the cash flow
for funds, how we can diversify the money we need within the next six months
among various banks and after that we should look at what we need to do to buy
T-Bills. We are perfectly authorized to
buy them. We will not make much on them
because everybody is buying them. Other
than that, the answer we got back from the bank is basically to trust
them. With regards to bankruptcy it is
beyond my scope and I would defer to counsel.
Mr. Lyles stated Mr. Schuhle is the National
Head of the Public Finance and Trust Operation for US Bank. I think you should take it with a grain of
salt. You have probably the most
knowledgeable guy they have on this subject, but he is also not going to allow
himself to get pinned down anymore than he has to. He is in a very responsible position. He devotes his time and effort to public finance
issues like our bonds.
Ms. Zich stated the SBA has taught
me a lot.
Mr. Fennell stated the guy who is
the head of that is going to be running for president. He and two others were actually in charge of
the Board. I cannot believe they have
not looked at the state retirement. The
same people run the same thing.
Ms. Zich stated everyone assumed
because it was the state it was going to be there.
Mr. Fennell stated it was not
professionally run.
Ms. Zich stated I am going to say
one more word about finance. I am going
to congratulate Ms. Woodward. Did you
know the field audits for this year that just ended September 30, 2008 are
done? Do you know how incredible that
is? When I first came on the Board it
was in June and you gave me the audit for the September before in August. I was horrified. Ms. Woodward has the field audits done
already. This means our auditors have
already been in here and are out preparing our final audit. It is incredible and she deserves a lot of
praise for it.
Mr. Fennell stated Ms. Woodward,
thank you very much and thank you for recognizing that.
Mr. Daly stated thank you for taking
that off my kudos list.
Mr. Fennell stated item five is the
approval of the check registers.
On MOTION by Ms. Zich seconded by
Mr. Hanks with all in favor the October check registers were approved.
SIXTH ORDER OF BUSINESS Administration of
Bond Funds
This
item was discussed under the fifth order of business.
SEVENTH ORDER OF BUSINESS Supervisors’ Requests and
Audience Comments
Mr. Daly stated I have
Mr. Lyles and Mr. Cassel looking at a contract for CSID to provide billing
services for another district on the west coast.
Mr. Fennell stated that is
great. We need to encourage that. We are going to be in a strong position going
forward to take on more services and we should.
We have infrastructure to do it and to make our cost more viable we need
to be taking on more things. I am going
to encourage you all to actively go out and spread our services.
Mr. Hanks asked Mr. Frederick, did
you have any progress with the culvert on Riverside?
Mr. Frederick responded we are going
to bid for that. We are doing some work
on the trash racks. We will also include
having those two pipes inspected on that contract. We are having a pre-bid meeting on November
19, 2008 and then the bid opening will be December 3, 2008.
Mr. Hanks asked where do we stand
with the gentleman who was here a couple of months ago with the trees?
Mr. Frederick responded they are still
there.
Ms. Zich stated we gave him 90
days.
Mr. Frederick stated he has one more
month. We are watching him.
Mr. Fennell asked any more comments?
Mr. Daly responded the newsletter
was supposed to have been presented to you today. Unfortunately, there was an illness and death
in the family of someone who was helping with it. I expect that you should have something
emailed to you next week, or at least, maybe, put at your door. It will most likely be a final version. If there is anything major on it, you can
give me a quick holler or send me an email.
We want to present it to the printer no later than Thursday of next week
for mailing around December 1, 2008.
EIGHTH
ORDER OF BUSINESS Adjournment
There being no further business,
On MOTION by Mr. Fennell seconded
by Ms. Zich with all in favor the meeting was adjourned.
Glen Hanks
Robert
D. Fennell
Secretary President