SSLGC 08-20-2009MINUTES OF THE
SCHERTZ-SEGUIN LOCAL GOVERNMENT CORPORATION
THE STATE OF TEXAS §
COUNTY OF GUADALUPE §
SCHERTZ-SEGUIN LOCAL §
GOVERNMENT CORPORATION §
On this the 20th day of August, 2009, the Schertz-Seguin Local Government Corporation
(SSLGC) convened at 1:35 p.m. in the City of Seguin Council Chambers located at 210 E.
Gonzales, Seguin, Texas. The following members being present and in attendance:
Sydney Bauer
Patricia Ramirez
Robin Dwyer
Jim Wolverton
Andrew Koenig
Betty Ann Matthies
Hal Baldwin
constituting a majority of the persons appointed to the Board and a quorum for the transaction of
business, and notice of such meeting having been duly given in accordance with the provisions
of Texas law. Also in attendance were:
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Alan Cockerell
Don Taylor
Doug Faseler
Johnny Bierschwale
Susan Caddell
Emery Gallagher
Georgia Hanks
Shawn Shimek
Sam Willoughby
Patrick Lindner
Bill Klemt
John Winkler
Crockett Camp
Jack Fickessen
President
Vice-President
Secretary
Treasurer
Director
Ex-Officio
Ex-Officio
General Manager
City Manager of Schertz
City Manager of Seguin
Assistant City Manager of Schertz
Finance Director of Seguin
Seguin Water Utility Manager
Administrative Assistant
Water System Superintendent
Schertz Public Works Director
Legal COU11se1 (Davidson & Troilo)
Hydrologist Consultant
COriSUltant (Walker Partners)
Consultant/Project Manager
Legislative Consultant
The first order of business was the calling of the meeting to order.
President Sydney Bauer called the meeting to order at 1:35 p.m.
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The second order of business was public comment.
President Bauer introduced SSLGC's newest board member Andrew Koenig. Mr. Koenig was
appointed to the board by the City of Seguin and approved by its city council on July 21, 2009.
President Bauer also welcomed Emery Gallagher who replaced John Schraub as Seguin water
utility manager.
The third order of business was Proclamation reco~nizin~ Seguin Water Utility Manager
John Schraub's Retirement - Sydney Bauer, President.
President Bauer presented Mr. Schraub with a proclamation recognizing his service with SSLGC
since its inception. On behalf of the board of directors he thanked Mr. Schraub and read the
proclamation which affirmed him a perpetual friend of SSLGC and its water project. President
Bauer deemed the agenda item non-debatable and declared the motion, second and approval
sustained. Mr. Schraub thanked board members and staff and said he appreciated their support
over the years. He felt honored to be a part of the project between the cities of Schertz and
Seguin to supplement water supplies for their citizens.
The fourth order of business was approval of the minutes for the board meeting held on
July 16, 2009.
Treasurer Jim Wolverton made a motion to approve the minutes of the July 16, 2009
meeting as written. Secretary Robin Dwyer seconded the motion. Upon a vote being
called, the motion carried by unanimous decision.
The fifth order of business was presentation of the General Manager's Report -Alan
Cockerell, General Manager.
General Manager Alan Cockerell's written report was included in the board agenda packets. He
highlighted the following items in his report:
• Water Production
Water pumpage for the month of July was 95.5% of SSLGC's monthly allowable as
mandated by the Gonzales County Underground Water Conservation District
(GCUWCD). The Corporation is allowed to pump up to 125% of its monthly allowable
during the course of a month, but not go over 100% for the year.
Region L
Mr. Cockerell attended the Region L quarterly meeting on August 6, 2009. The proposed
amendment to the 2006 Regional Water Plan was adopted. It will be submitted to the
Texas Water Development Board for approval. Work has begun on the 2011 Plan. The
next meeting will be held in November 2009 with possible meetings in December and
January 2010. A brief discussion was held on Region L projects and concepts for the
2011 Plan.
Two work groups have been formed: one for Gonzales County groundwater projects
which will meet September 15, 2009; and one for Guadalupe Basin water needs which
will meet August 28, 2009. Mr. Cockerell has been invited to participate in the Gonzales
County groundwater project work group and plans to attend both work groups.
• GCUWCD
Mr. Cockerell attended GCUWCD's monthly meeting which was held August 11, 2009.
Business was conducted according to the posted agenda. Canyon Regional Water
Association's (CRWA) public hearing to renew production permits was delayed until the
September 2009 meeting. The September agenda will also include a public hearing to set
tax rates.
• Groundwater Management Area 13 (GMA-13)
Mr. Cockerell attended a GMA-13 meeting on August 13, 2009. He reported that GMA
will probably not set desired future conditions until September 2010 which is the
deadline the state passed. Mr. Cockerell plans to attend the next GMA-13 meeting which
is scheduled for September 18, 2009.
• Guadalupe County Groundwater Conservation District (GCGCD)
Mr. Cockerell attended the GCGCD meeting held August 13, 2009. Normal business
was conducted. He gave a brief summary of a report on the status of the CRWA project
and called attention to an email from the executive director of the Texas Alliance of
Groundwater Districts which was included in the board agenda packets.
• Operations Report
Mr. Cockerell reported that well #5 is out of service. The oil tubing was leaking. Parts
have been ordered and the pump should be placed back in service the end of August. The
Corporation's other seven wells have kept up with water supply demand. Mr. Cockerell
plans to research and possibly purchase coated oil tubing. If purchased, the tubing will
be kept in stock at the plant in case of emergencies.
• Other Issues
Discussion was held regarding the Corporation's last drain valve leak. Mr. Cockerell
reported that the drain valve's steel bolts had eroded because they were not stainless
steel. Almost all of the Corporation's drain valves have stainless steel bolts. The few
that do not can be changed out in the fall or winter.
The sixth order of business was ArmstronE, Vaughan & Associates, P.C., Audit
En~a~ement Authorization -Alan Cockerell, General Manager, & Susan Caddell, Director
of Finance.
Mr. Cockerell asked for board approval to authorize him to sign the audit engagement letter for
FY 2009-2010 between SSLGC and Armstrong, Vaughan & Associates.
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Secretary Dwyer made a motion to approve the authorization for General Manager
Cockerell to sign the audit engagement letter with Armstrong, Vaughan & Associates for
FY 2009-2010. Vice-President Ramirez seconded the motion. Upon a vote being called, the
motion carried by unanimous decision.
The seventh order of business was Repair of Booster Pump #4 by Smith Pump Company,
Incorporated -Alan Cockerell, General Manager.
Mr. Cockerell presented an estimate from Smith Pump Company in the amount of $26,636.30 to
repair booster pump station pump #4. He stated that that ananti-vortex strainer would be
included with the repairs. He explained that funds to pay for the repairs are available in the
operations and maintenance budget, but because the amount was significant he asked for Board
approval to complete the repairs. He asked for more than the estimated $26,636.30 due to
possible installation charges.
Treasurer Wolverton made a motion to approve repair of booster pump #4 to include an
anti-vortex strainer by Smith Pump Company in an amount not to exceed $28,000.00.
Secretary Dwyer seconded the motion. Upon a vote being called, the motion carried by
unanimous decision.
President Bauer recognized Texas State Representative Edmund Kuempel as he arrived at the
board meeting.
The eighth order of business was Public Funds Investment Act Training for General
Manager/Investment Officer Alan Cockerell in accordance with SSLGC Investment Policy
-Alan Cockerell, General Manager.
According to SSLGC investment policy, the investment officer of the Corporation is required to
attend approved Public Funds Investment Act training every two years. Mr. Cockerell asked for
board approval to attend the required training with a class sponsored by the University of North
Texas on August 24-25, 2009.
Secretary Dwyer made a motion to approve Public Funds Investment Act training
sponsored by the University of North Texas for SSLGC Investment Officer/General
Manager Alan Cockerell in accordance with SSLGC investment policy. Vice-President
Ramirez seconded the motion. Upon a vote being called, the motion carried by unanimous
decision.
The ninth order of business was Presentation of Treasurer's Report -Susan Caddell,
Finance Director & Alan Cockerell, General Manager.
A copy of the Treasurer's report was included in the board agenda packets. The report was
prepared by Director of Finance Susan Caddell and reviewed by General Manager Alan
Cockerell. Mr. Cockerell recommended approval of the following report:
a. Financial Statements for nine months ending June 30, 2009.
• Revenues, Expenses and Changes in Net Assets -Combined Statements
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^ $939,589 (net income)
Includes water sales billed for the first debt service payment made February 1, 2009,
as well as the expenditure for the first debt service payment.
• Revenues, Expenses and Changes in Net Assets -Operating Fund
^ $132,931 (net income)
The largest expenditure for this fund is water leases which is 38% of total
expenditures.
• Revenues, Expenses and Changes in Net Assets -Construction Fund
^ -$1,348,127 (net loss)
• Revenues, Expenses and Changes in Net Assets -Interest & Sinking Fund
^ $1,398,300
Includes I & S rates paid by participating entities for the first three quarters and first
bond payment of the year in the amount of $2,107,623. The rates paid by the City of
Selma are for off-peak water sales. The next bond payment was made August 1,
2009, in the amount of $1,284,742.
• Revenues, Expenses and Changes in Net Assets -Repair & Replacement Fund
^ $341,125
• Revenues, Expenses and Change in Net Assets -Future Development Fund
^ $220,079
• Revenues, Expenses and Change in Net Assets -Impact Fund
^ $195,281
• Revenues, Expenses and Change in Net Assets -Operating Fund (comparative
statement)
^ -$173,098 (net loss)
The largest increase in expenditures is $286,816 in water leases.
• Working Capital Trend Chart
^ $821,422 (working capital)
Treasurer Wolverton made a motion to approve SSLGC's financial statements for the
quarter ending June 30, 2009. Vice-President Ramirez seconded the motion. Upon a vote
being called, the motion carried by unanimous decision.
b. Investment Report for the quarter ending June 30, 2008.
Ms. Caddell presented the Investment Report for April 1, 2009, through June 30, 2009. Interest
earnings for the quarter ending June 30, 2009, were $8,484.
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Secretary Dwyer made a motion to approve SSLGC's investment report for the quarter
ending June 30, 2009. Vice-President Ramirez seconded the motion. Upon a vote being
called, the motion carried by unanimous decision.
c. Reimbursement to the City of Seguin in accordance with the Management Services
Agreement for the quarter ending June 30, 2009.
Ms. Caddell presented the expenditure information for the quarter April 1, 2009, through June
30, 2009. The total amount of reimbursement from SSLGC requested by the City of Seguin for
the third quarter of 2009 is $792,070.
Treasurer Wolverton made a motion to authorize reimbursement from SSLGC to the City
of Seguin in the amount of $792,070 for the quarter ending June 30, 2009, in accordance
with the Management Services Agreement. Secretary Dwyer seconded the motion. Upon a
vote being called, the motion carried by unanimous decision.
The tenth order of business was Pumping Test of #1 Moorman Ranch -Bill HIemt,
Hydrologist & John Winkler, Walker Partners.
General Counsel for the Corporation Patrick Lindner advised board members of their right to
address the agenda item in executive session if Mr. Klemt or they felt the information to be
presented would affect the Corporation's ability to purchase real estate for future expansion.
Board members and Mr. Klemt elected to proceed with the report during open session.
Mr. Klemt referred to his report dated July 28, 2009, which was included in the board agenda
packets. The report provided results of a pumping test on July 23, 2009, of the #1 Moorman
Ranch which is located on the Frates Seeligson Ranch near Pandora, Texas, in Wilson County.
The well is a recompleted oil well. In 2004 holes were shot in the casing so that Carrizo water
could be produced. During the drawdown portion of the test, results clearly showed the well to
be impaired as the aquifer parameters of the test were representative of an impaired well. For
example, the specific capacity of the well based on drawdown data is about 1.05 gpm/ft of water
level drawdown and it should be 20 or 30 gpm/ft. Field measurements of water chemistry taken
during the drawdown test indicated a pH of approximately 8.5 and total dissolved solids (TDS)
of about 600 mg/L as compared to the Corporation's Nixon well field pH of about 5.5 and TDS
of 150, respectively. Mr. Klemt concluded that the water does meet Texas drinking water
standards although it is a little high in aluminum and chloride as noted in Lower Colorado River
Authority laboratory analyses. Although the performance of the aquifer could not be evaluated
because of the impaired well, the test showed that the water would mix with the Corporation's
Nixon well field water very well.
General Manager Cockerell called attention to a technical memorandum regarding the Wilson
County water supply from John Winkler of Walker Partners. The report demonstrates that
blending of the water from Wilson County with either or both the Corporation's water supplies
from Guadalupe or Gonzales County would be beneficial in regard to chemical costs, treatment
costs and well pump construction.
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The eleventh order of business was CRWA /Springs Hill WSC /SSLGC Interlocal
Agreement -Alan Cockerell, General Manager.
Mr. Cockerell reported that a draft agreement between SSLGC, CRWA and Springs Hill WSC to
manage their requirements for water resources in Guadalupe County was included in the board
agenda packets. Although board action was not necessary, he wanted to inform board members
of the project's status.
The twelfth order of business was Legislative Update -Jack Fickessen, Consultant.
Mr. Fickessen gave a brief report of a few concerns pertaining to Chapter 36 of the Water Code
that Texas Alliance of Groundwater Districts Director Greg Ellis formerly with the Edwards
Aquifer believes should be addressed in the next legislative session. These issues include: a
water corporation's public debt and its ability to profit or not profit from the debt distribution;
whether or not a water district has to renew a permit on an annual basis; and consistent fee
generation such as transportation costs charged by districts. On the Corporation's behalf, Mr.
Fickessen plans to provide necessary assistance to bring these issues to the attention of the
responsible legislative committees.
The thirteenth order of business was Guadalupe County Expansion Proiect -Alan
Cockerell, General Manager.
Mr. Cockerell reported that the immediate goal of SSLGC and its engineers is to complete the
construction plans for the project and submit them to the Texas Commission on Environmental
Quality for approval. This process should be completed by November or December of 2009.
The fourteenth order of business was Gonzales County Expansion Proiect -Alan
Cockerell, General Manager.
President Bauer deferred agenda item fourteen to Executive Session.
President Bauer closed General Session at 2:29 p. m.
The fifteenth order of business was Executive Session called under Chanter 551
Government Code, Subsection 551.071, to seek the advice of its attorney on legal matters
relating to the Board of Director's rights and liabilities under certain contracts, Section
551.072, to deliberate the purchase of and/or sale of certain real estate and Section 551.074,
for deliberations regarding a specific officer or employee.
President Bauer opened Executive Session at 2: 38 p. m.
Executive Session was held from 2: 38 p. m. to 3: 46 p. m.
The sixteenth order of business was to consider and take action as a result of Agenda Item
Fifteen.
President Bauer reopened General Session at 3: 46 p. m.
No action was taken as a result of Executive Session
The seventeenth order of business was Consideration and/or Action on questions and
possible items to be placed on the next agenda.
No additional discussion was held.
The next regular board meeting was scheduled September 17, 2009, at 1:30 p.m. in Schertz,
Texas.
The eighteenth order of business was adjournment.
President Bauer declared the meeting adjourned at 3:47 p.m.
MINUTES APPROVED THIS ~ ~ DAY OF J ~~~VYI.~~_ , 2009.
Robin Dv~
Secretary
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