Loading...
03-20-2014MINUTES 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 March, 2014 the Schertz /Seguin Local Government Corporation (SSLGC) convened at 1:30 PM in the City of Schertz Council Chambers located at 1400 Schertz Parkway, Building #4, Schertz, Texas. The following directors being present and in attendance: Ken Greenwald President Robin Dwyer Vice- President Larry Dublin Secretary Kerry Koehler Treasurer T. "Jake" Jacobs Assistant Secretary Mayor Keil Ex- Officio David Scagliola Ex- Officio 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: John Bierschwale Executive Director (City of Schertz) Susan Caddell Director of Finance (City of Seguin) Sam Willoughby Public Works Director (City of Schertz) Emery Gallagher Water Utility Manager (City of Seguin) Nancy Vaughan Auditor (Armstrong, Vaughan & Associates) Patrick Lindner General Counsel (Davidson, Troilo, Ream & Garza) Steven Siebert San Antonio Water System (sAws) John Winkler Consultant (wafer Partners) Billy Phenix Legislative Consultant Bill Klemt Consultant /Hydrologist Alan Cockerell General Manager (ssLGc) Shawn Shimek Water Superintendent (SSLGC) Regina Franke Administrative Assistant (SSLGC) The first order of business was to Call the Meeting to Order. President Ken Greenwald called the meeting to order at 1:33 PM The second order of business was Public Comment. There were no public comments. The third order of business was Approval of the Minutes for the Board Meeting held on February 20.2014, Secretary Dublin made a motion to approve the February 20, 2014 minutes as read. Treasurer Koehler seconded the motion. Upon a vote being called, the motion carried by unanimous decision. I.of6 The fourth order of business was Presentation of the General Manager's Report — Alan Cockerell, General Manager. General Manager Cockerell's written report was included in the board agenda packets. He added the following items to his written report: A Water Production Seasonal pumping and monthly water sales charts were included in the board agenda packets. Water production for the month of February was 62.8% of Gonzales County Underground Water Conservation District's (GCUWCD) monthly allowable. ➢ GCUWCD Montblk Meeting The monthly meeting was held March 11, 2014. Mr. Cockerell attended. A copy of the meeting agenda was included in the board packet. He advised that normal business was conducted. A letter requesting the renewal of all well permits and an exception to the district rules was delivered to GCUWCD on March 14, 2014. Mr. Cockerell noted that a copy of the letter was included in the board packet. ➢ GCGCD Month& Meeting There was no meeting in March 2014; the next meeting was scheduled for April 10, 2014. TCEQ Public Hearing The hearing was held March 6, 2014 in Seguin. A copy of the public notice was included in the board packet. The hearing was well attended by landowners, public official and concerned public. Mr. Cockerell advised that SSLGC did provide a verbal statement referencing the written comment which had been submitted. Region L /GMA -13 GMA -13: The meeting was scheduled for March 13, 2014 in Pleasanton; Mr. Cockerell attended. He noted that draft DFC's are being developed to be presented to each groundwater district. The next GMA -13 meeting was scheduled for May 15, 2014. 9 CVLGC The CVLGC meeting was held on February 27, 2014 in Cibolo. The meeting agenda was included in the board packet. The next meeting was scheduled for March 27, 2014 in Converse. The fifth order of business was Presentation of F'Y2012 -2013 Audit Report — Nancv r Vaughan, Armstrong, Vaughan and Associates. Copies of the SSLGC FY2012 -2013 Audit Report were provided in the board packets. Ms. Vaughan with Armstrong, Vaughan & Associates, P.C., presented an overview of the report. Highlights of the FY2012 -2013 report are as follows: 2 ofd Ms. Vaughan began by stating that there were no significant deficiencies in the internal controls. She noted that there were some suggested adjustments and all were agreed to. Ms. Vaughan also advised that SSLGC was in compliance regarding the Public Funds Investments Act (PFIA). She said that FY2012 figures had been restated to conform to two new accounting pronouncements. Ms. Vaughan called attention to Page 8 of the Audit Report (Statement of Net Position). She listed Total Current Assets to be $6,426,218, which were approximately $1,000,000 more than FY2012. The Total Restricted Assets were $23,684,301 which was primarily representative of bond funds that had not been spent as of September 30, 2013. The balance for Net Propery, Plant & Equoment was noted to be $78,465,951. Total Assets were $108,941,476. She noted that listed below Total Assets was Deferred Outflow of Resources (one of new accounting pronouncements). That represents cumulative charges on the refunding bond issues which are amortized over the life of the new bond in the amount of $1,935,207. That is no longer listed as a reduction of liability, as it was in previous year's audits. She moved to Page 9 and noted that there was $108,949,749 in Total Liabilities compared to $104,043,417 in FY2012. Ms. Vaughan stated that there was a negative ($4,723,901) in Net Investment in Capital Assets. That number represents the total capital assets less the liabilities that were issued to fund those (infrastructure less the debt). The reason it was negative was because the depreciation charges on the capital assets were accelerating faster that the principal pay down of the debt; she expected that would reverse at some point. Ms. Vaughan stated that under The Restricted Net Position there were several items set aside by outside sources, either bond covenants or the impact fee resolution. Those are required to be spent on specific items. The Unrestricted Net Position of $2,081,905 increased from FY2012 by approximately $1,000,000. The Total Net Position was $1,926,934. Ms. Vaughan advised that another change that was made in the accounting standards was bond issue costs. Previously, when there were costs associated with issuing a bond, those costs were capitalized and amortized over the life of the bond. Under the new accounting standard that would have appeared as an asset, it was not an asset. This was an expense that should be charged at the time the bonds were issued. Due to the new accounting standard those were removed from the Balance Sheet and that required a prior period adjustment to the Net Position. That can be seen on Page 10. The Total Operating Revenues were $10,292,854, roughly equal to the year before at $10,536,266. The Total Operations & Maintenance of $2,225,818 which was down from $2,634,245 FY2012 and was approximately $500,000 less than what was budgeted. The Other Operating Expenses consisted of the Amortization of Lease Acquisition Costs $85,399, which were almost fully amortized, Annual Lease Payments —Water Rights $2,473,882 and Depreciation $1,506,043 . The Operating Income (Loss) was $4,001,712 compared to $4,281,956 in FY2012. Ms. Vaughan moved to Page 11 for some other Non - operating Revenues (Expenses). She advised that a portion of those were the Reimbursement Paid to Participating Governments. Ms. Vaughan stated that when those were contributed by the participating governments, that was where the amounts were reflected as a revenue, therefore they were now presented there as an expense. The total Change in Net Position was a negative ($819,682). Ms. Vaughan called attention to the above mentioned Prior Period Adjustment necessary regarding the new accounting standard in the amount of ($1,450,035) shown for FY2012. 3 of 6 Vice - President Dwyer made a motion to accept the FY2012 -2013 Audit Report as presented by Ms. Nancy Vaughan of Armstrong, Vaughan & Associates, P.C. Treasurer Koehler seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The sixth order of business was Approve to Award Contract — Seguin Connection — Terminus # 3 — Alan Cockerell, Generaf Manger & John Winkler, Walker Partners. ➢ Resolution # SSLGC R14 -02 Mr. Cockerell stated that bids were received for the connection at the City of Seguin Water Plant. The bid tab was included in the board packet. Mr. Cockerell noted that Mr. Winiker had written a letter recommending JS Haren Company with a base bid of $534,400 and an add alternate bid of $75 per vertical foot. Mr. Cockerell also advised that there would be SCADA improvements necessary to be performed by HEI in regards to this same connection in the amount of $25,710. Secretary Dublin voiced his concerns regarding the difference between the bids. Mr. Winkler advised that the projects that JS Haren was in the process of appeared to be going well, and he had not received any negative feedback about the company. Secretary Dublin made a motion to approve Resolution # SSLGC R14 -02 to award the contract for the Seguin Connection — Terminus # 3 to JS Haren Company, approve the use of the 2010 Bond Funds for the contract and authorize the General Manager to sign said contract. Vice - President Koehler seconded the motion. Upon a vote being called, the motion carried by unanimous decision. ➢ Resolution # SSLGC R14 -03 Assistant Secretary Jacobs made a motion to approve Resolution # SSLGC R14 -03 to award contract to HEI for SCADA Improvements related to the Seguin Connection -- Terminus # 3, approve the use of the 2010 Bond Funds for the contract and authorize the General Manger to sign said contract. Secretary Dublin seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The seventh order of business was SSLGC Capital Projects — Alan. Cockerell, General Manager & John Winkler, Walker Partners Included in the board packet was Table 5 -1 Description and Cost Summary Capado Improvements. After board discussion the tentative suggested priority of the list was as follows: 1. SE Schertz Quadrant Improvements 2. Cathodic Protection System 3. Rehabilitate Existing Ground Steel Storage Tanks 4. Guadalupe Well Field & Parallel Pipelines Table 5 -2 Description and Cost Summary Operational Improvements was also included in the board packet and included 2 projects, one of which (SSLGC Administrative Building) had been modified and is near completion. WTP Offices remained the only project listed on Table 5 -2 and was not included in the current Pepper- Lawson contract. Mr. Cockerell advised he would work with Mrs. Caddell to determine the balances in the Repair & Replacement Fund, 2010 Bond Fund and Impact Fee Fund. This would help to decide how each of the projects would be financed. This item will be placed on the next agenda for further discussion and possible action. 4 of 6 The eighth order of business was SAWS Expansion Project Update — John Winkler, Walker Partners & Alan Cockerell, General Manager. Mr. Winkler advised that Pepper - Lawson management stated that they expected their completion date would be May 14, 2014. Mr. Winkler noted that he anticipated a later date, closer to the end of May 2014, as he believed that Pepper - Lawson had more items to complete that were more time consuming than they had considered. He stated that, barring any additional obstacles, they could be done by the end of May 2014. Mr. Winkler also advised that he would be communicating with SAWS regarding the potential for liquidated damages. The ninth order of business was SSLGC Construction Update /Seguin Connection — John Winkler, Walker Partners & Alan Cockerell. Mr. Cockerell stated that the remodel of the Old Fire House / SSLGC Administrative Building was progressing as scheduled. He noted that there were some issues involving the size of the restroom stalls, but Staff had worked with the contractor to resolve each of them. The tenth order of business was Legislative Update — Billy Phenix, Legislative Consultant & Alan Cockerell, Executive Director. Counselor Lindner recommended Executive Session. President Greenwald deferred item ten to Executive Session. The eleventh order of business was Status Update BPS Ground Storage Tank /Preload and Action in Response to Same — Patrick Lindner, General Counsel & John Winkler, Walker Partners & Alan Cockerell, General Manager. Executive Session Recommended President Greenwald deferred item eleven to Executive Session. The twelfth order of business was Wholesale Water Contract() — Patrick Lindner, General Counsel. Executive Session Recommended President Greenwald deferred item twelve to Executive Session. The thirteenth order of business was Gonzales County & Guadalupe County Carrizo and Wilcox Water Leases — Alan Cockerell, General Manager. Executive Session Recommended President Greenwald deferred item thirteen to Executive Session. The fourteenth order of business was Executive Session called _ under Chapter 551 Government Code, Section 551.071, to seek the advice of its attorney on legal matters, and Section 551.072, for deliberations regarding real estate. President Greenwald closed General Session at 2:38 PM Executh)e Session was held f om 2:47 PM to 3:41 PM The fifteenth order of business was to Consider and Take Action as Result of Agenda Item Number fifteen. President Greenwald reopened General Session at 3:42 PM 5 o f 6 Agenda Item # 10: No action requested /No action taken Agenda Item # 11: No action requested /No action taken Agenda Item # 12: No action requested /No action taken Agenda Item # 13: No action requested /No action taken The sixteenth order of business was Consideration and /or Action on Questions and Possible Items to be placed on the Next Agenda. ❖ The next board meeting was scheduled for April 17, 2014 in the City of Seguin at 1:30 PM The seventeenth order of business was Adjournment. President Greenwald declared the meeting adjourned at 3:43 PM MINUTES APPROVED THIS 17TH DAY OF APRIL, 2014. s� OR Larry Dublin, Secretary T. "Jake" Jacobs • , Assistant Secretary 6of6