The Board of Directors of the Snake River Water District (SRWD), Summit County, Colorado, met via on line Zoom conference on February 14, 2023, for their regular quarterly meeting. The meeting was called to order by President Helmer at 4:00 p.m.
Roll Call
The following members of the Board of Directors were present, constituting a quorum: Dave Helmer - President; William Bergman - Vice President; Char Bloom - Secretary; Randy May - Treasurer; Rick Swisher - Director. Also present: Scott Price - District Administrator; Ron Mentch - Superintendent of Operations; Dan Teodoru - Legal Counsel for the District; Tom Oberheide - Water Engineer; Donna Svenson - Financial Manager; Alec Bry - Lead Engineer; Bill Bowerman - Constituent and Board Candidate.
Consent Agenda
President Helmer asked if anyone had questions or comments regarding the November minutes, the transaction reports, or the two resolutions on the agenda. None were forthcoming. Director May made a motion to approve all items on the Consent Agenda. Secretary Bloom seconded. The motion passed unanimously.
May 2023 Board Member Elections and Term Limits
Mr. Price summarized the current state of the Board. Mr. Helmer and Ms. Bloom will be term-limited and cannot run for re-election. Mr. Teodoru stated that the Board can appoint whoever is a qualified elector to an empty Board seat during the May meeting.
Mr. Bowerman is interested in running during the upcoming election and has submitted a self-nomination. Mr. May and Mr. Swisher will need to self-nominate this year.
A brief discussion ensued about current officers and if they wished to continue in those roles. Everyone agreed to continue with the same officers.
Capital Projects Update
Director May asked the members to review his summary of projects in the packet. He stated that the Pump Facility has the primary equipment installed yesterday. The controls and electrical power are scheduled to be installed. The supply chain for industrial equipment has not gotten any better. Two valves needed took about one year to be delivered. A meeting with the US Forest Service is scheduled for Friday. The goal is to get approval for building a new tank and apply for a SRF loan to pay for the tank project.
Mr. May discussed the Schoolmarm Water Line, and that it was originally in the pre-qualification process for the SRF that Mr. Price submitted last summer. Some of the requirements of the SRF from the Bipartisan Infrastructure Law will negatively impact the timeline for the selection of a general contractor and ordering pipes. By extending the project, construction will not be possible in 2023 as expected. Mr. May explained that the Schoolmarm project would not be applying for SRF funding because the high risk is driving urgency of getting the transmission line replaced this summer. Other Board members agreed that was a good decision to remove Schoolmarm from the SRF application.
Mr. May reminded the Board about the $3 million loan which still has substantial funds remaining, and the District will use the funds to pay for the Schoolmarm project. Mr. Bergman asked if the funds are specific to any projects. Mr. May stated that they can be used for any of the capital projects.
A general discussion was conducted among Board members about the Master Plan, how many projects are remaining, when the Base 2 Tank will be constructed, and how much money is available for the projects. Mr. May stated that he intends to focus on SRF funding for the tank because it is the largest project, and there is more time available for the entire process to satisfy the special requirements of procurement.
Mr. Bergman commended Mr. May and Mr. Price for outstanding management of the District's money and making good decisions regarding priorities. Mr. Helmer wrapped up the discussion.
Water Rights Summary for 2022
Mr. Price asked Mr. Oberheide to summarize his update to the Board. Mr. Oberheide highlighted that the District has about I 00 acre feet of unused augmentation supplies for water used out of priority in Aug Plans 1, 2, and 3. Total volume is about 140 acre feet, and we only used 36 acre feet for depletions out of priority in 2022. Mr. Bergman and Mr. Helmer stated concerns that the District could lose water rights. Mr. Oberheide said that his conversations with water attorneys indicated that there is no mechanism for the state to take away rights that are acquired to set aside for future growth. If we tried to sell the water rights, then the rights would lose value because of unused status. SRWD wants to keep all of its water rights, so he does not expect a loss of rights or value.
Mr. Oberheide summarized the complaint against the state. There are 20 acre feet of water rights that could be affected by a state decision, which has an estimated value of $800,000. There is no substantial progress made in the water court yet. Mr. Price commended Mr. Oberheide for his work with Glenn Porzak in preparation for this complaint. Mr. Oberheide stated that the Colorado River District supports our position for the 20 acre feet and that the state is wrong. Mr. Teodoru agreed.
Tap Fee Increase Discussion
Mr. Price asked the Board to consider his memo in the packet. He stated that Board minutes for the last 15 years contained numerous references to intention to raise rates and fees, but only once since the 1990s has the Board voted to raise tap fees or water user fees. He asked that the Board only discuss the topic, but a vote for increase is not on the table at this time. He stated that inflation rate is approximately 8%, and the $8,500 tap fee that was put in place in 2019 would be over $10,000 if adjusted for inflation. He recognized that there are several steps involved in any increase, for example public meetings and notifications. He expressed his desire to keep the fees in line with inflation, but that he does not expect the Board to take immediate action. It would probably be 2024 before any type of increase would be implemented, even if the Board is supportive now. In order to maintain the District's ability to pay for the needed system improvements as defined in the Master Plan, tap fees should keep up with inflation.
Mr. May discussed capital expenses that will be necessary in addition to the Master Plan. As Treasurer, he would support increasing tap fees in the near future to cover extraordinary increases in the costs of construction. He does not believe there is any urgency yet, but it will take many months or possibly years to enact an increase.
A discussion ensued about the various known developments going forward in the District. It was stated that no one wants to negatively impact those developments. Mr. Bry stated that the District has about 20% remaining for Keystone buildout. Mr. May stated that properties in the Mountain House area can be redeveloped. Mr. Teodoru reminded everyone that the rate of inflation is remarkable, and it affects everything needed to build and operate. We should have periodic discussions and consider staying ahead of the costs.
Mr. Bergman asked Mr. Bry to share his thoughts. Mr. Bry stated that it is definitely a valid topic to consider. Maybe next year would be appropriate for an increase. Mr. Helmer stated that he is inclined to move slowly. Mr. Bergman agreed. Mr. Price wrapped up the discussion and promised to put it on the next agenda for consideration.
Approve Wintergreen Agreements
Mr. Price asked the Board to approve the standard Water Main Extension Agreement and Water Service Improvement Agreement for Wintergreen Ridge. Mr. Teodoru summarized the legal discussions and complications relative to Gorman having a ground lease from Vail Resorts. He stated that there are no concerns with this process, but the bond will not be held by Summit County. Mr. Bergman expressed his trust that if Mr. Teodoru approved it, then the Board should approve it now. Mr. Bergman made a motion to approve the agreements. Secretary Bloom seconded. The motion passed unanimously.
Administrator's Discussion Items
Mr. Price reviewed his memo to the Board covering two topics: An IT assessment and funding the Master Plan's capital projects.
A firm was chosen to assess information technology used by the District and make a roadmap for the future. That firm, Eplexity, confirmed that the current cybersecurity implementation is adequate. They recommended staying with Aclara. The billing system needs to be replaced. The SCA DA system was positively affirmed. The budget for software and hardware was underspent for Computer Software and Hardware by approximately $60,000.
He expressed his recommendation to get a billing system that will offer a customer-facing online portal. He proposed that his team research and compare available solutions for a billing system. Mr. Helmer stated that we need to find a good solution. Mr. Mentch said that he believes Mr. Price will be skilled to manage that process because he is a software engineer. Mr. May asked Mr. Price to clarify his proposal. Mr. Price said that the consultants worked on all of the software assessment, but they did not try to find a billing solution. He and his team will find the best solution at a price the District can afford. Mr. Helmer asked how many hours would be needed, and Mr. Prices stated that he is offering a fixed bid proposal for $5,000 to select the best solution,
regardless of how long it takes. There will be no additional charge for managing the implementation.
Mr. Bergman asked if Mr. Price's proposal for funding the Master Plan is the same as last year. Mr. Price stated that there are IO less hours per month this year. Mr. Bergman stated that he was very pleased with the work performed thus far and supports the continuation of this arrangement to get funding to pay for capital projects. Mr. Helmer agreed.
Mr. Bergman made a motion to approve both of Mr. Price's proposals for the billing software solution and for the additional time for funding the Master Plan. Secretary Bloom seconded. The motion passed unanimously.
Superintendent's Discussion Items, Water Production and Unaccounted Water
Mr. Mentch reviewed his memo to the Board. He stated that he cleaned up the graphs. He has scheduled leak detection in May. He mentioned that PFAS testing will start in April, and the EPA will send sampling bottles for Base 2 and Base 3. This is currently an unregulated substance. Mr. Bry stated that the EPA is in the works for making PF AS a regulated contaminant. Mr. Mentch stated that there are 29 contaminants covered, including lithium. He asked if anyone had questions. There were none. Mr. Price commended Mr. Mentch for doing an excellent job running the water operations. Mr. Bergman agreed.
Review and Acceptance of Fourth Quarter Financials
Mr. Price reviewed the current assets and budgeted expenses. He pointed out that the Treasurer has made good decisions and increased the investment income by over 100%. Most districts are struggling to fund operations, but SRWD is performing very well and 2022 was an outstanding year. He asked if anyone had questions regarding accounts, values, or money in the bank. None were forthcoming. He stated that the auditors are visiting next week.
Mr. Helmer made a motion to accept the fourth quarter financials. It was seconded by Ms. Bloom. The motion passed unanimously.
Board Member Comments
Mr. Bergman recommended that the Board have a formal dinner in early summer and in the autumn. Mr. Helmer and Mr. May agreed. Mr. Bergman made a motion to have two dinners in 2023. Secretary Bloom seconded. The motion passed unanimously.
Adjournment
Secretary Bloom made a motion to adjourn. It was seconded by Mr. Bergman. The motion passed unanimously. President Helmer adjourned the meeting at 5:28 p.m.
Respectfully Submitted,
Scott Price
Recording Secretary
Approved by the Board of Directors
Char Bloom
Secretary