The Board of Directors of the Snake River Water District (SRWD), Summit County, Colorado, met at the district offices at 0050 Oro Grande Road and via online Zoom conference on November 12, 2024, for their regular quarterly meeting. The meeting was called to order by Scott Price at 4:00 p.m.
ROLL CALL
The following members of the Board of Directors were present at the meeting, constituting a quorum: William Bergman - President; Steve Martin - Secretary; Randy May - Treasurer; Bill Bowerman - Vice President; Steve Bushkuhl – Assistant Secretary; and Scott Thisted – Assistant Secretary. Also present: Scott Price – District Administrator; Ron Mentch – Superintendent of Operations; Dan Teodoru – Legal Counsel for the District; Donna Svenson – Financial Manager; Alec Bry – Lead Engineer.
CONSENT AGENDA
Mr. Price reviewed the information in the packet regarding the minutes and transaction reports. There were no questions or comments. Mr. Bushkuhl made a motion to approve the Consent Agenda. Mr. May seconded. The motion passed unanimously.
PUBLIC HEARING TO REVIEW AND ADOPT THE 2025 BUDGET FOR THE SNAKE RIVER WATER DISTRICT
The public hearing was opened. Discussion was held regarding the proposed budget for 2025. No public comments were received. The hearing was closed. Mr. Martin made a motion to adopt the 2025 budget and the accompanying resolutions. Mr. May seconded. The motion passed unanimously.
APPROVE RESOLUTION FOR WATER FEE INCREASE
A resolution for a 12% water fee increase was presented that achieves the Board’s previous decisions to fund the Master Plan. Mr. Bowerman made a motion to approve the resolution. Mr. May seconded. The motion passed unanimously.
CAPITAL PROJECTS UPDATE
Mr. May provided an update on the District's capital projects, highlighting the successful completion of the Loveland Pass Village project. He met with Stan Miller to review the final billing of the project, which resulted in a change order that lowered the contract amount in the District’s favor by $239,477. Mr. May was complimentary of Ron Mentch, Stan Miller, and all project participants. There were minimal disruptions to traffic and water service. Board members commended Mr. May for outstanding project management.
Mr. May discussed the upcoming Base 2 Storage Tank project. During the public comment period, all submitted comments were positive. The primary USFS representative is hopeful to get the final decision for approval to SRWD by the end of year to allow construction in the summer of 2025 for the road and water mains. The design of the tank next year will be based on soil testing which will be facilitated by the new road. Construction of the tank is expected in 2026 if the USFS approvals are received. Proposals have been received regarding engineering aspects of the projects, and those will be evaluated in the coming months.
Mr. Price stated that SRWD is blessed to have Mr. May oversee these projects because his performance and attention to detail as the District’s owner’s representative is extraordinary. Mr. Bergman expressed his appreciation for the progress and hard work by Mr. May on all the capital improvements.
ADMINISTRATOR’S DISCUSSION ITEMS
Mr. Price discussed the completion of the GIS project, and he thanked Mr. Bry for the excellent work by AE2S. Mr. Mentch expressed the benefit of the new system to his team and the project exceeded his expectations.
Mr. Price explained the emphasis being put on utilities by the federal government (CISA) to begin a focus on Cybersecurity. Emails are being regularly sent from various agencies, and webinars are being hosted that are trying to educate water districts on the risks posed by hostile entities (e.g. foreign hackers) that want to cripple the U.S. infrastructure. Mr. Martin asked Mr. Teodoru if the District would have liability if the systems were hacked. Mr. Teodoru stated that ransomware is the biggest concern because other entities have been blackmailed to pay millions of dollars to regain control of their systems. Mr. Price stated that he had provided Mr. Teodoru with a proposed task order for evaluating vulnerabilities and creating a Cybersecurity Plan.
Mr. Price addressed the PFAS detection in the District’s wells, and he stressed that the CDPHE communications indicate that there is no immediate public health risk. He and Mr. Bry discussed the water sampling and testing being conducted by the School of Mines. Mr. Price explained that the District will be reimbursed for much of the work from $179,000 grants from the state.
Mr. Price presented a summary of the water rights lawsuit for HUP water rights. The summary judgment motion has not been ruled on by the judge. It is anticipated that the lawsuit will go to trial because the state attorney general’s office was totally unwilling to cooperate at the mediation meeting in Denver.
Mr. Price reviewed the history of the District’s desire for Administrators to have a succession plan and how Mr. Hill had sold his business to transition to Quality Water Management Inc. Mr. Price stated that Mr. Teodoru’s proposed new contract is intended to facilitate an institutionalized approach to replacing key employees because that would ensure stability for the District. Mr. Price deferred further discussion of the new agreement to a later agenda item.
APPROVE RESOLUTION FOR NEW ACCOUNT BILLING
Mr. Price presented a resolution to change the billing process for new accounts, stating that billing will now commence upon payment of tap fees and the issuance of water permits. This adjustment aims to ensure that new customers begin contributing to the District's revenue as soon as they initiate water service. Without this change, customers received free water for months or years during the construction process. Mr. Bushkuhl made a motion to approve the resolution. Mr. Bergman seconded. The motion passed unanimously.
SUPERINTENDENT’S DISCUSSION ITEMS - WATER PRODUCTION AND UNACCOUNTED WATER
Mr. Mentch reviewed his memo to the Board regarding unaccounted water levels. He assured the Board that his team is investigating the root cause of the higher-than-expected levels. Mr. Price commended Mr. Mentch for the attention to frequent distribution system assessments (technology survey) and his team’s proactive approach to reducing leaks.
REVIEW AND ACCEPTANCE OF THIRD QUARTER FINANCIALS
Mr. Price reviewed the third quarter financials. He emphasized that Net Operating Income is above budget. He mentioned the District currently has $39 million in the bank, $26 million of which needs to be spent on capital expenditures per the Master Plan. Expenses were generally on track to come in under budget, but Water Rights Legal Fees are significantly above budget because of the lawsuit. Mr. Bergman made a motion to accept the financials as presented. Mr. Bushkuhl seconded. The motion passed unanimously.
APPROVAL OF CONTRACT ADDENDA FOR WATER WORKS WEST AND QUALITY WATER MANAGEMENT
Mr. Price discussed the addendums for cost of living adjustments for Water Works West and Quality Water Management. These are the same format as used in previous years and need to be considered now although Mr. Teodoru’s new contracts may replace the addenda. Mr. Bowerman motioned to approve the contract addenda. Mr. May seconded. The motion passed unanimously.
DISCUSSION OF CONTRACTUAL MATTERS WITH LEGAL COUNSEL – ATTORNEY ITEMS
Mr. Teodoru discussed updated contracts for both Water Works West and Quality Water Management. His primary purpose for new contracts was to provide long-term benefit to the District by reducing the risk of short notice turnover of the most important vendors and partners. The Board has expressed a desire to retain Mr. Mentch and Mr. Price, as well as having a better mechanism for succession planning. Mr. Teodoru explained that one of the main updates is moving from annual renewal to renewal every five years. Another important aspect of the new contracts is to facilitate the approval of out-of-scope projects in task orders.
A discussion of the details in the new contracts ensued. Some Board members expressed dissatisfaction with errors in the documents, as well as the reason for not having the contracts drafted months earlier as promised. Mr. Teodoru acknowledged the issues and promised that he would send out a finalized version of the contracts immediately so that the board could approve for adoption via electronic media.
DISCUSS LONG-TERM INVESTMENT OPTIONS - POLICY
Mr. Thisted proposed an amendment to the investment policy to allow for longer-term investments in U.S. Treasury obligations, extending the limit from five years to ten years. This type of investment would lock in higher rates as the Federal Reserve begins a reduction in interest rates. Mr. May stated that the District would need to analyze the capital plan for timing of expenditures and the balance of unneeded reserves to determine the amount to invest in a ten year instrument.
Mr. Thisted motioned to amend the investment policy to allow ten year investments. Mr. Bowerman seconded. The motion passed unanimously.
BOARD MEMBER COMMENTS
Board members shared comments regarding a great meeting and expressed appreciation for the team's efforts.
ADJOURNMENT
Mr. Bergman made a motion to adjourn. It was seconded by Mr. Bushkuhl. The motion passed unanimously. Mr. Price adjourned the meeting at 5:05 p.m.
Respectfully Submitted,
Scott Price
Recording Secretary
Approved by the Board of Directors
Scott Thisted
Assistant Secretary