MINUTES

DEPARTMENT OF WATER & POWER
BOARD OF COMMISSIONERS
MINUTES FOR A REGULAR MEETING
FEBRUARY 22, 2005

A meeting of the Board of Commissioners of the Department of Water & Power, City of Big Bear Lake, was called to order at 8:08 a.m. by Treasurer Conley, at the DWP Board Room, 41972 Garstin Drive, Big Bear Lake, California.

FLAG SALUTE: Led by Board Member Speyers

BOARD MEMBERS PRESENT:

Susan Conley, Treasurer
Bill Speyers, Board Member
Barbara Willey, Board Member

BOARD MEMBERS EXCUSED:

Rick Herrick, Chairman
Eddie Etter, Vice Chairman

OTHERS PRESENT:

Jerome D. Gruber, General Manager
Scott Heule, Assistant General Manager
Diane Muir, Office Manager
Steve Wilson, Water Superintendent
Bill La Haye, Water Conservation Specialist
Robyn Bratton, Secretary to the Board
Darrell Mulvihill, Mayor
Bill Jahn, City Council Member
Bob Colven, CSD Board President
Steve Schindler, BBARWA General Manager
Ron Seymour, Big Bear News
Danielle Seckler, Bear Valley News
Three Members of the Public

ITEM NO. 2 - PUBLIC FORUM

Treasurer Conley opened the meeting to the public at 8:10 a.m.. No one from the public wished to speak. Treasurer Conley closed the public forum at 8:10 a.m.

ITEM NO. 3 - CONSENT CALENDAR

3.1 Minutes of a Regular meeting dated January 25, 2005
3.2 Finance/Variance Reports & Authenticate Check Registers
3.3 Monthly Management Staff Reports
3.4 General Manager's Report
3.5 Revised FY 2005/06 Budget Schedule
3.6 Vehicle Allowance Increase for the DWP Water Superintendent, Steve Wilson
3.7 Cherokee & Magnolia Wells CEQA Proposals

Board Member Willey requested that Item No. 3.4 be removed from the Consent Calendar.

Motion made by Board Member Willey, seconded by Board Member Speyers, and carried 3-0 to approve the Consent Calendar.

ITEM NO. 4 - ITEMS REMOVED FROM THE CONSENT CALENDAR

3.4 Board Member Willey asked that a clarification be made regarding the fluoride blending/sharing with the CSD and how it relates to the BBARWA Recharge Project. She then asked if and when the well could be used for drinking water.

GM Gruber stated that it would be used for blending. Conceptually, the well would be used for the blending portion of the Recharge Project. He had some concerns and would like to see the fluoride facility be utilized to meet the blending ratio to be used with the Recharge Project.

Board Member Speyers asked if the final costs are too high then would the blending change in priority. GM Gruber stated that it would change and there would be other options but he couldn't speak for BBARWA.

Board Member Speyers stated that there was a conflict with the March 10 field trip; a County Supervisors meeting was being held that same day. Bob Colven stated he would talk to Gary Keller, the CSD's Water Superintendent, to see if they could reschedule the field trip for another day.

To further clarify Board Member Willey's question, Bob Colven stated that after BBARWA's Recharge Project blending requirement is finished, they would then explore the drinking water possibilities.

Board Member Willey stated she understood the well would produce 1,000 gpm, per Rod Watkins' presentation at the last Board meeting.

ITEM NO. 5 - HILTON GARDEN INN REVISED CONDITIONS OF SERVICE

AGM Heule reviewed the revised conditions of approval for the Hilton Garden Inn with the Board and there was general discussion.

Board Member Speyers asked if there was a well that had already been drilled on the property and produced 100 gpm. AGM Heule stated a test well had been drilled west of Metcalf Creek and north of Big Bear Blvd. and produced approximately 60 gpm on the adjacent property and not on the proposed Hilton Inn property. The owner has given the DWP authorization to drill a test hole on his property in the future.

Board Member Speyers asked how far the test hole was from the project site and could the DWP go back to that site in the future. AGM stated the test well was approximately 350 feet to the west and staff would like to stay to the far north on the Hilton property because the bedrock deepens the closer you get to the lake.

Motion made by Board Member Speyers, seconded by Board Member Willey, and carried 3-0 to approve the revised conditions of water service for the Hilton Garden Inn as specified in the staff report.

ITEM NO. 6 - MARYLAND/KNICKERBOCKER BOOSTER STATION

AGM Heule discussed the history of the subject project and reported on the bids. The developer has requested that the DWP not accept the lowest bid at this time and staff recommends that no decision be made by the Board at this meeting.

Treasurer Conley asked if the developer is financially responsible for the costs of the booster station, why is the DWP involved? AGM Heule responded that the DWP has the responsibility to maintain and manage this construction project so the work can be supervised to ensure everything is done properly and meets design standards. The developer would reimburse the DWP.

Treasurer Conley stated that the Board would not take any action on this item as requested by staff.

ITEM NO. 7 - MCALISTER WELL EQUIPPING

AGM Heule discussed the bids on the McAlister Well equipping. He stated he was quite surprised at the high bid results. Apparently the price of concrete and steel has gone up substantially.

AGM Heule requested that the Board award the project to the lowest bidder, Value Engineering, in the amount of $309, 520.

Treasurer Conley asked if staff had concerns over the variation in the amounts of the bids. How can a contractor perform for one price and not another. AGM responded that the bidding process is an "art". In some cases it depends upon labor costs.

GM Gruber stated that sometimes a contractor will leave money on the table, and bid low, just to get the bid in the hopes they will be hired again for another project.

Board Member Speyers asked if there was a penalty clause. AGM Heule stated yes, if the project is not completed in 120 days.

Treasurer Conley asked if the time frame was dependent upon the weather. AGM stated yes.

Motion made by Board Member Willey, seconded by Board Member Speyers, and carried 3-0 to award the contract to the lowest responsible bidder, Value Engineering, in the amount of $309,520, and that the project budget be increased by 10 percent over the bid amount.

ITEM NO. 8 - AUTHORIZE POSITION OF PRINCIPAL ADMINISTRATIVE ANALYST & ASSOCIATED FUNDING

GM Gruber reviewed the history of the Water Conservation Specialist position and stated that this position was originally only a one-year contract. When a contract employee is kept on past the contract time, some problems occur and benefits come into play, etc. Because of this, the DWP cannot continue to employ a contract person.

Treasurer Conley asked why the DWP couldn't keep Bill La Haye on full-time and has he been working on other non-water conservation-related projects. GM Gruber responded that Bill has been primarily working on water conservation projects. GM Gruber met with Human Resources and Bill's contract was to be reevaluated after one year. If it continues much more than one year, it could be problematic with regard to salary and back benefits, etc., and legal issues could arise.

Board Member Speyers asked if Bill has any background education that qualifies Bill for Principal Analyst. GM Gruber stated yes.

Motion made by Board Member Willey, seconded by Board Member Speyers, and carried 3-0 to Adopt Resolution No. DWP 2005-XX, authorizing the funding of the Principal Administrative Analyst position, and authorize the finance director to transfer $31,000 from A/C 520-5291-3991 (Conservation) to A/C #520-5283 (Salaries and Benefits).

Treasurer Conley adjourned the meeting for a break at 9:15 a.m.

Treasurer Conley reconvened the meeting at 9:27 a.m.

ITEM NO. 9 - REGULATORY ADVISOR FUNDING FY 2004/05

GM Gruber reviewed the background with the Board and turned it over to AGM Heule.

AGM Heule discussed the DWP projects that need outside funding and how the DWP could go about obtaining these funds with the aid of an outside agency, The Ferguson Group (TFG), a bipartisan government relations consulting firm.

Board Member Speyers stated he was happy with the background references of TFG, but questioned the educational background. He felt it was important to do an extensive background check.

Board Member Willey made a statement for Chairman Herrick, who was not present at the meeting. Chairman Herrick had concerns about taking money from the budget to hire an outside agency. Now that Jerry Lewis has the DWP as a constituent, Chairman Herrick felt that Congressman Lewis' support would be substantial now that he is Chairman of the Appropriations Committee. Chairman Herrick feels that the DWP staff and Board Members could assist with researching the available funds/and or grants available in Washington.

Board Member Willey stated that she is very much in favor of using TFG. She has had to deal with situations such as this in her previous job and feels it would be money well spent. She stated that it's who you know in Washington and how the system works that will help us to get to the proper people and get the funding we need. She also stated the money is there in Washington in the form of grants, low interest loans, and through appropriations; however, you need experts in water issues to assist in acquiring the available monies.

Treasurer Conley asked if TFG would be truly working in the DWP's best interests, and will a DWP representative need to go to Washington to represent the water system. AGM Heule stated TFG would be working for the DWP and that someone from the DWP should go to Washington once just to put a face to our community, and from that point on let TFG represent the DWP. Any more visits to Washington by a DWP representative would be a waste of both Congressman Lewis' and the DWP staff's time.

Treasurer Conley asked if the agreement was approved, would the deadline be met. AGM stated yes.

Treasurer Conley asked Steve Schindler if BBARWA was working with a similar agency, and if so, for how long, what have the results been, and why didn't they go with TFG. Steve responded that they have been working with the Furman Group for approximately one year. The Furman Group was referred to BBARWA by another consultant of theirs. To date, there have been no results, but hopefully soon.

Treasurer Conley asked Steve if he felt that BBARWA was being fully represented. Steve stated yes.

Motion made by Board Member Willey, seconded by Board Member Speyers, and carried 3-0 to approve a contract with The Ferguson Group (TFG) at $5,000 per month ($60,000 for 12 months), plus $3,000 expenses over the contract life to pursue appropriations funding for two DWP projects in Federal FY 2006. Contract funding to be $20,000 plus a portion of expenses out of the Fund Balance and $40,000 plus a portion of expenses from the DWP FY 2005/06 Budget.

Board Member Willey suggested that a representative from TFG come and meet with the Public Relations Committee consisting of Chairman Herrick and Board Member Willey.

Treasurer Conley requested that Board Member Willey be involved due to her extensive background with this process.

ITEM NO. 10 - LANDSCAPE RESOLUTION NO. DWP 2004-08 REVISION

Treasurer Conley, one of the Landscape Committee members, reviewed the changes to the Landscape Resolution, based on input from the City Council and landscapers. She was happy with the final results of the resolution. As a result of the final meeting with the landscapers, staff agreed with and accepted approximately 90 percent of the changes suggested by the landscapers.

Motion made by Board Member Speyers, seconded by Board Member Willey, and carried 3-0 to approve Resolution No. DWP 2005-XX revising General Landscape Resolution No. DWP 2004-08.

ITEM NO. 11 - CHANGES IN CONSERVATION RESOLUTION NO. DWP 2004-05 (A PORTION OF WCR5(B))

Bill La Haye reviewed his report with the Board and staff and there was general discussion regarding placing the responsibility of retrofitting a residence upon the change of service. In the case of a renter, the owner will be responsible.

Motion made by Board Member Speyers, seconded by Board Member Willey, and carried 3-0 to approve Resolution No. DWP 2005-XX with changes to Conservation Resolution No. DWP 2004-05 (a portion of WCR5(B).

ITEM NO. 12 - CITY REPORTS (none)

ITEM NO. 13 - BOARD MEMBER REPORTS

Treasurer Conley stated that in a recent Sun article, Lake Arrowhead is 8" from capacity, and the water agency has changed their conservation policy.

Treasurer Conley adjourned the meeting for a break at 10:20 a.m.

Treasurer Conley reconvened the meeting at 10:30 a.m.

ITEM NO. 14 - CLOSED SESSION

1. CONFERENCE WITH REAL PROPERTY NEGOTIATOR
   Pursuant to Section 54956.8 of Government Code

   (a) Property:APN #304-126-04 (West)
   Negotiating Parties: General Manager & Assistant General Manager

   (b) Property: APN #306-096-18 (39121 Robin Rd. - Loftis/Christianson)
   Negotiating Parties: General Manager & Assistant General Manager

2. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION SIGNIFICANT EXPOSURE TO LITIGATION
   Pursuant to Subdivision (b) of Section 54956.9 of Government Code
   Number of Cases (1) Objections to improvements required for APN #309-221-06
   
   
3. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION SIGNIFICANT EXPOSURE TO LITIGATION
   Pursuant to Subdivision (b) of Section 54956.9 of Government Code
   Number of Cases (1) Threat of litigation in letter dated 12/21/04, from attorney for Tract #12217.
   
   
4. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION POSSIBLE INITIATION OF LITIGATION
   Pursuant to Subdivision (c) of Section 54956.9 of Government Code
   Number of Cases (1)

ITEM NO. 15 - OPEN SESSION

Into Open Session at 11:22 a.m. - No reportable action taken.

ITEM NO. 16 - ADJOURN

There being no further action to come before the Board, Treasurer Conley adjourned the meeting at ll:25 a.m.

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Robyn Bratton, Secretary to the Board

Approved at meeting dated: 3/22/05

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