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SSLGC 10-16-2008r~ MINUTES OF THE SCHERTZ-SEGUIN LOCAL GOVERNMENT CORPORATION THE STATE OF TEXAS § COUNTY OF GUADALUPE § SCHERTZ-SEGUIN LOCAL § GOVERNMENT CORPORATION § On this the 16th day of October, 2008, the Schertz-Seguin Local Government Corporation (SSLGC) convened at 1:39 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 Ken Greenwald Robin Dwyer Jim Wolverton Patricia Ramirez Betty Ann Matthies Hal Baldwin President Vice-President Secretary Treasurer Director Ex-Officio 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: Alan Cockerell General Manager Don Taylor Doug Faseler Johnny Bierschwale -Susan C-addell John Schraub John Bailey Georgia Hanks City Manager of Schertz City Manager of Seguin Assistant City Manager of Schertz Finance Director of Seguin Water Utilities Manager of Seguin Water Superintendent Administrative Assistant Patrick Lindner Legal Counsel (Davidson & Troilo> Bill Klemt Hydrologist Consultant John Winkler Consultant ~,arr~ Crockett Camp Consultant/Project Manager The first order of business was the calling of the meeting to order. President Sydney Bauer called the meeting to order at 1:36 p.m. The second order of business was public comment. No one addressed the Board during public comment. The third order of business was approval of the minutes for the board meeting held on September 18, 2008. President Sydney Bauer referred to page three of the minutes, Agenda Item 6, the Management Services Agreement between SSLGC and the City of Schertz and SSLGC and the City of Seguin, and asked if Counsel Patrick Lindner had reviewed and endorsed both documents as expressed in the contingency for approval at the September 18, 2008, board meeting. General Manager Alan Cockerell stated that Counsel Lindner had reviewed and approved both documents. Secretary Robin Dwyer made a motion to approve the minutes of the September 18, 2008, meeting as written. Treasurer Jim Wolverton seconded the motion. Upon a vote being called the motion carried by unanimous decision. The fourth order of business was presentation of the General Manager's Report -Alan Cockerell, General Manager. Mr. Cockerell's written report was included in the board agenda packets. He added the following items to his written report: • Gonzales County Underground Water Conservation District (GCUWCD) -General Manager Cockerell handed out an agenda for the GCUWCD meeting held October 14, 2008. Normal business was conducted at the meeting. The District approved the re- permitting of two wells in Gonzales County. One well was located in the City of Nixon. • Groundwater Management Area-13 (GMA-13) - A draft agenda of the meeting held October 15, 2008, was included in the board agenda packets. Hydrologist Consultant Bill Klemt and General Manager Cockerell attended the meeting. Items on the agenda included: o A presentation was made by the San Antonio Water Systems (SAWS) on a recommendation for its Desired Future Conditions (DFCs). SAWS recommended a 200 ft. drawdown in the Carrizo and 400 ft. drawdown in the Wilcox. SAWS' Wilcox brackish water project will drawdown the aquifer in the well field by approximately 400 ft. No action was taken. o Possible action on DFCs was included in the agenda. No action was taken. A table which showed average drawdowns in each district was included in the board agenda packets. Each Underground District submitted low, medium and high pumping scenarios. Two additional GAM runs will be conducted. One run will include numbers for all projects in the Region L plan and the other run will include more realistic numbers, e.g., the Corporation's project. GMA-13 will not meet the deadline of November 1, 2008, set by Region L to establish DFCs. Another meeting will be scheduled when the additional GAM runs are completed. o Proposed rules for the GCUWCD were included in the board agenda packets. The rules should be approved at the next meeting. Most of the changes are to formulate rules in accordance with Chapter 36 of the Water Code. Mr. Cockerell stated that he had reviewed the rules and had found no substantial changes. He offered to present comments or concerns of board members to the GCUWCD before the next meeting if necessary. o A draft Management Plan for the GCUWCD was included in the board agenda packets. A Public Hearing is scheduled October 29, 2008. The Corporation's 20,000 acre-ft are included in the plan. a Booster Pump Station -Pump #4 remains out of service due to a pump failure. Major repairs are necessary. The cause has not been determined. A replacement pump has been ordered and ananti-vortex basket will be added to the pump to address noise issues. The pump is two years old and out of warranty. The fifth order of business was Resolution SSLGC R08-10 to review and approve SSLGC's Investment Policy in order to conform to the Public Funds Investment Act, Texas Government Code, Chapter 2256 -Susan Caddell, Finance Director & Alan Cockerell, General Manager. The Public Funds Investment Act and SSLGC's Investment Policy require the Investment Policy to be reviewed and approved annually by the Board of Directors. Resolution SSLGC R08-10 and the Corporation's Investment Policy were included in the board agenda packets. Finance Director Susan Caddell stated that SAMCO Capital Markets had reviewed the policy at the request of staff. After staff conferred with SAMCO Capital Markets representatives, they recommended several modifications to the policy as follows: Page 6 -Investments in one pool limited to no more than 75% under Diversification and Maturity Limitations. Page 6 -Money market mutual funds which are insured by the federal government added to the list under Diversification and Maturity Limitations. Page 7 -Money market mutual funds added to the list under Qualified Institutions. Page 10 -Surety bonds were deleted from the Allowable Collateral section. Page 10 -Letters of credit issued by the Federal Home Loan Bank were deleted from the Allowable Collateral section. Staff recommended approval of the proposed Investment Policy with the suggested changes listed above. Treasurer Wolverton made a motion to accept the. changes and approve SSLGC's Investment Policy, Resolution SSLGC R08-10, as required by the Public Funds Investment Act. Secretary Dwyer seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The sixth order of business was Resolution SSLGC R08-11 to review and approve SSLGC's Brokers/Dealers list -Susan Caddell, Finance Director and Alan Cockerell, General Manager. SSLGC's Investment Policy requires its Brokers/Dealers list to be reviewed and approved annually by the Board of Directors. Resolution SSLGC R08-11 and the Corporation's Brokers/Dealers list were included in the board agenda packets. Ms. Caddell stated that Dick Ebert from UBS Financial Services and Bob Ross from Funds Management had been added to the list. She added that each broker/dealer is required to read SSLGC's Investment Policy, complete a questionnaire and sign a certification page previous to any .purchase of investments by the Corporation. Staff recommended approval of the Brokers/Dealers list. President Bauer made a motion to approve SSLGC's Brokers/Dealers list, Resolution SSLGC R08-11, with the noted additions as required by the Corporation's Investment Policy. Vice-President Greenwald seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The seventh order of business was Resolution SSLGC R08-12 to set a Public Hearing on proposed modifications to Water Impact Fees -Alan Cockerell, General Manager. The Impact Fee Advisory Committee met October 14, 2008, to consider a proposal to modify the base meter size and associated living unit equivalent (LUE) used to determine the Corporation's impact fees. Tables demonstrating the present and proposed base meter size and associated LUE were included in the board agenda packets. Committee members based their recommendation on the following data: • Presently, more commercial and residential growth occurs in the City of Schertz than the City of Seguin. • If adopted, the Corporation's schedule would mirror the City of Schertz instead of the City of Seguin as it does now. • The base meter size would change from 3/4 inch to 5/8 inch. • The Corporation's revenues would increase due to the change of the base meter size and related LUE. • The impact fee of $1,262 would not change. • Commercial customers rather than residential customers would most be affected. A letter of recommendation from the Impact Fee Advisory Committee to modify the Corporation's base meter size and associated LUE used to determine impact fees was presented to the Board of Directors. Mr. Cockerell asked for approval to schedule a Public Hearing at the Corporation's next board meeting November 20, 2008, on proposed modifications to the Corporation's water impact fees, Resolution SSLGC R08-12. After hearing public comment, action will be taken to approve the recommended change. Treasurer Wolverton made a motion to approve Resolution SSLGC R08-12 to set a Public Hearing on proposed modifications to the Corporation's base meter size and, associated LUE. President Bauer seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The eighth order of business was the Gonzales County Water Treatment Plant Improvement Proiect - Alan Cockerell, General Manager and Tom Caponi, Burt/+Partners. General Manager Cockerell stated that the project is complete and all systems are operational. A final statement is expected soon from RDP for the lime slurry system. The ninth order of business was the Gonzales County Water Treatment Plant Filter Rehabilitation Proiect -Alan Cockerell, General Manager and John Winkler, Lockwood, Andrews & Newnam, Inc. (LAN). This project is the second phase of the filter rehabilitation project. Two filters were rehabilitated during the winter of 2007. Four filters will be rehabilitated this winter. A bid tabulation of five bids and a letter from John Winkler which summarized the process were included in the board agenda packets. Mr. Winkler stated that he had researched each company and respective bid specifications and recommended the contract be awarded to Associated Construction Partners, LTD. Staff agreed and asked for approval to award the contract to Associated Construction Partners, LTD, in the amount of $434,112.00. Secretary Dwyer made a motion to award the contract to Associated Construction Partners, LTD, in the amount of $434,112.00 for the rehabilitation of four filters at the Corporation's Gonzales County Water Treatment Plant. Vice-President Greenwald seconded the motion. Upon a vote being called, the motion carried by unanimous decision. The tenth order of business was water level measurements for Gonzales County -Bill HIemt, Hydrologist Consultant. Mr. Klemt's written reports for Gonzales County and Guadalupe County were included in the board agenda packets. He summarized the Gonzales County report as follows: Carrizo water levels were measured in water-level observation wells which are located in the vicinity of SSLGC's well field on September 22 and September 23, 2008, by Mr. Klemt, General Manager Cockerell and GCUWCD General Manager Greg Sengelmann. Mr. Klemt referred to several Tables and Figures in his report. Table I demonstrates the records of wells measured. Table II exhibits the Carrizo Aquifer water level measurements and water-level drawdowns for the periods: Aug-Sept/02 through June/08 and August-Sept/02 to Sept/08. Table III shows Queen City Aquifer water-level measurements. Presently, Queen City water levels do not appear to be affected by Carrizo pumping. Figures 1, 2 and 3 show locations of observation wells, altitude of Carrizo water levels and Aug-Sept/02 to Sept/08 water-level drawdowns, respectively. Four wells in the vicinity of the well field for the six year period show an average decline of 31 ft. which is approximately 5 ft. per year. Mr. Klemt believes the Carrizo Aquifer is performing as good, or better, than models predicted. Mr. Klemt added that measurements of regional water level decline date back to the late 1950s and early 1960s. Data from six wells, two in Guadalupe County and four in Gonzales County are documented. It shows an average rate of decline of the four wells of approximately .60 ft. per year prior to the start-up of SSLGC's well field. The eleventh order of business was Guadalupe County Expansion Proiect -Alan Cockerell, General Manager. President Bauer deferred agenda item eleven to Executive Session. The twelfth order of business was Gonzales County Expansion Proiect -Alan Cockerell, General Manager. President Bauer deferred agenda item twelve to Executive Session. s The thirteenth order of business was Off-Peak Water Contracts- Alan Cockerell, General Manager. President Bauer deferred agenda item thirteen to Executive Session. President Bauer closed General Session at 2: 27 p. m. The fourteenth order of business was Executive Session called under Chapter 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. Executive Session was held from 2:42 p.m. to 3:40 p.m. The fifteenth order of business was to consider and take action as a result of Agenda Item Fourteen. President Bauer reopened General Session at 3:41 p. m. As a result of Executive Session: Agenda Item 11-Guadalupe County Expansion Project Counsel Patrick Lindner requested a motion to approve a water lease and signing bonus of $50 per allowable acre-ft. with the Ackermanns. Treasurer Wolverton made a motion to approve authorization for the general manager to sign a water lease with the Ackermanns which includes a signing bonus of $50 per allowable acre-ft. Secretary Dwyer seconded the motion. Upon a vote being called, the motion passed by unanimous decision. Counsel Lindner requested a motion to authorize the general manager to sign a water lease and an earnest money contract with Sedley Martin and to request a check for a signing bonus of $70 per allowable acre-ft. Secretary Dwyer made a motion to approve authorization for the general manager to sign a water lease and an earnest money contract with Sedley Martin; pay a signing bonus of $70 per allowable acre-ft, and sign an earnest money contract in the amount of $40,000 for the purchase of easements and wells. Treasurer Wolverton seconded the motion. Upon a vote being called, the motion passed by unanimous decision. Agenda Item 12 -Gonzales County Expansion Project Counsel Lindner recommended that the board approve in principal the draft Mitigation Agreement between SSLGC and GCUWCD. It would be effective or signed upon issuance of final production and export permits to the Corporation. Treasurer Wolverton make a motion to approve in principal the draft Mitigation Agreement between SSLGC and GCUWCD to be effective or signed upon issuance of final production and export permits to the Corporation. Vice-President Greenwald seconded the motion. Upon a vote being called, the motion passed by unanimous decision. Counsel Lindner requested a motion to approve authorization for the general manager to enter into a contract with Economists.com to provide expert review and testimony on the Corporation's behalf regarding SAWS' contested case for well permits in Gonzales County and for the general manager to set the limit of costs not to exceed the amount he deems appropriate. Secretary Dwyer made a motion to approve authorization for the general manager to enter into a contract with Economists.com to provide expert review and testimony on the Corporation's behalf regarding SAWS' contested case for well permits in Gonzales County and for the general manager to set the limit of costs not to exceed the amount he deems appropriate. Treasurer Wolverton seconded the motion. Upon a vote being called, the motion passed by unanimous decision. The sixteenth order of business was additional Board of Directors discussion and/or comments. No additional discussion was held. The next regular board meeting was scheduled November 20, 2008, in Schertz, Texas. A Public Hearing on proposed modifications to SSLGC's impact fees will be held. The seventeenth order of business was adjournment. President Bauer declared the meeting adjourned at 3:45 p.m. MINUTES APPROVED THIS ~~~ UVV~ .~~ Robin Dwyer Secretary DAY OF I V ~~, , 2008.