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 May 9, 2023, 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, constituting a quorum: William Bergman; Char Bloom; Randy May; Bill Bowerman. 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.
2023 Board Election
Mr. Price summarized the election results, including that the election was cancelled. Bill Bowerman and Randy May had completed and signed the oath of office which was filed with the clerk. Mr. Bergman made a motion to appoint Char Bloom to the Board. Mr. May seconded, and the motion passed unanimously.
Mr. Price stated that the Board must elect officers, and each member expressed their willingness to fulfill an officer role. Ms. Bloom made a motion to elect William Bergman as President, Bi II Bowerman as Vice-President, Randy May as Treasurer, and she would be Secretary. Mr. May seconded, and the motion passed unanimously.
Consent Agenda
Mr. Price reviewed the information in the packet regarding the February Board minutes and the three Transaction Derail Reports. President Bergman asked if anyone had questions or comments regarding the minutes. None were forthcoming. Secretary Bloom made a motion to approve all items on the Consent Agenda. Vice-President Bowerman seconded. The motion passed unanimously.
Acceptance of the 2022 Audit
Mr. Price asked Ms. Puca to present the audit report summary to the Board. Ms. Puca stated that the audit went smoothly, and they were issuing a clean opinion. She described the new GASB 87 rule regarding leases that adds an item to the Balance Sheet which shows the present value for the receivables based on the number of years remaining on the lease. The new loan with Holman Capital was put on the books with the escrow account at Fresno First Bank. The escrow account is not a Colorado bank that conforms to the POPA, but she stated that the District is not at risk for $1.6m. Mr. Teodoru stated that the money is like a home equity line of credit. If the bank went under, then the District would not be held liable for the unspent escrow funds. Ms. Puca stated that the auditors wanted to be conservative and mention it. She then asked if anyone had any questions regarding the audit report. No one had any questions or comments.
Mr. May made a motion to accept the 2022 audit as provided. Secretary Bloom seconded. The motion passed unanimously.
Mr. Price thanked the auditors for their work. Ms. Puca stated that the final report would be sent soon.
Updated 2022 Financial Statements After Audit
Mr. Price directed the Board to the new version of2022's Balance Sheet and P&L that contained revised data after posting the adjusting journal entries provided by the auditors. The updated statements would reflect the lease receivable, the loan, and the escrow account.
Secretary Bloom made a motion to accept the 2022 financials. Mr. Bowerman seconded. The motion passed unanimously.
Capital Projects Update
Mr. May provided a summary of the current projects and asked if anyone had questions. Mr. Bergman asked where the site of the new storage tank is specifically. Mr. May answered that the primary site under consideration is above and east of the Tenderfoot housing, and our connection to the site would go through Vail Resorts property. VR has agreed to provide an easement. The Forest Service has indicated that their opinion would be that site would qualify for an environmental exclusion. But we have become aware of some wetlands that were not previously considered. We have consultants evaluating those wetlands for enabling AE2S to determine a way to install a pipeline without disturbing more than 1/10 111 of an acre of wetlands.
The mobilization for the Schoolmarm pipeline is scheduled for July 15. The contract with Hyder Construction has been finalized. Mr. May asked if there were any additional questions, and none were presented.
Administrator's Discussion Items
Mr. Price described his team's process for evaluating new billing and customer portal solutions. He discussed how the research was conducted and the vendor's software and company scored. The unanimous choice was CUSl's Utility Management System. Mr. Bowerman asked if that was a cloud solution, and Mr. Price confirmed that it is. The functionality and the costs were discussed. The only limitation from what was expected is that the daily meter data will not be stored in CUSI. So, a customer will be able to login to see their usage for the previous billing period, but it will not be possible to see if an abnormally high meter read occurred in the past few days which could indicate a leak. Mr. Bergman commended Ms. Svenson for an excellent summary of the vendor selection criteria and scoring.
Mr. Price asked the Board to approve this decision and provide authorization to sign the contract after Mr. Teodoru approves it. Mr. Bergman made a motion to approve the decision and move forward with the implementation. Mr. Bowerman seconded. The motion passed unanimously.
Mr. Price explained that the Aclara cloud solution will be implemented this summer. It will contain new leak detection reporting that should be helpful in improving the District's chances of addressing a problem with a service line or perhaps a stuck toilet in a condo building. Mr. Price will be discussing the configuration for such reports with Aclara during the software conversion. Mr. Teodoru stated that he had already negotiated the agreement with Aclara, and that it is ready for the Board to approve. Ms. Bloom made a motion to direct Mr. Price to sign the contract and schedule the conversion to the new version of Aclara. Mr. Bowerman seconded. The motion passed unanimously.
Mr. Price directed the Board to his report in the packet, and he emphasized that SRF funding will have additional requirements that will probably extend the capital project process. He referred to the new storage tank project, and Mr. May agreed. Mr. May stated that there is no guarantee that the state will approve our loan, and there is no guarantee that an excavating company in Summit County will have female excavators or meet the percentage of minority employee requirements placed on SRF by the federal lawmakers. Mr. Price assured the Board that he will work diligently with the state project manager to avoid any problems with the RFP process. He stated that it may demand that we work with Denver contractors in order to meet the fed requirements. He agreed with Mr. May that there are no guarantees. Although it is expected that the SRWD loan would have a 49% forgiveness, the Bipartisan Infrastructure Law could allow the state to forgive other loans in excess of 49%, while not forgiving any of ours. Some of the training has stated that small districts can be "disadvantaged" simply because they are smalI/rural.
Mr. Price specified the list of projects expected to be in the loan application to be the new tank, Rasor Drive pipeline loop, the pipeline replacement near Base 3 water plant, and the pipeline replacement at Mountain House area. He confirmed that the engineering phase of the SRF process is beginning for the Rasor Drive and Storage Tank projects and the District has recently requested proposals from AE2S for the design of each pipeline replacement project. He stated that Mr. May, Mr. Mentch, Mr. Bry, and others are meeting periodically to coordinate progress on each of these projects. The loan application will not be considered by the state until the necessary engineering documentation is ready and certain approvals from the US Forest Service have been completed.
Mr. Price stated that he would like to continue the discussion regarding a tap fee increase. Mr. Bergman stated that he did not want to apply an increase to the projects beginning this summer. Mr. Bowerman asked for clarification as to which large projects would be paying tap fees this summer. Mr. Price explained that Wintergreen had already paid. He also said that Alcove would be starting in the next few weeks, and the Brightwood Lofts are expected to pay their fees this summer. There were no other large projects that could be identified. Ms. Bloom asked when the increase would take place. Mr. Price suggested an increase become effective January I, 2024. Mr. May stated that the District would conduct public meetings and publish notifications months in advance which would allow for constituents to voice any feedback. Mr. Price assured the Board that he would pursue the same activities of outreach that were conducted during the water user fee increase.
The amount of the increase was discussed. Mr. Price reflected on the inflation that has occurred since the last tap fee increase, and the need to put a fee in place that would not need to be changed each year. So, he recommended $12,000. It will have been five years since the last increase, and the $12,000 is a reasonable fee that will account for inflation over the next five years before the next anticipated increase. A discussion ensued regarding Mr. Price's logic with the reality of increases in the cost of other utilities, capital projects, real estate, and water regulation compliance. Everyone agreed that the logic is sound, and no one wanted to reconsider more tap fee increases each year, so factoring in the next five years of inflation was beneficial to the District. It was also noted that the proposed increase would be the same percentage of increase as was approved five years ago.
Ms. Bloom made a motion to increase the tap fee to $12,000 beginning on January I, 2024. Mr. Bowerman seconded. The motion passed unanimously.
Superintendent's Discussion Items, Water Production and Unaccounted Water
Mr. Mentch reviewed his memo to the Board. He believes the most important area to discuss is unaccounted for water that can indicate leaks and it is about 17% this quarter. There is one known active leak in Loveland Pass Village. A customer's service line leak is scheduled for repair today at the owner's expense. The outside specialists for leak detection are surveying this week.
Water sampling for PFAS and lithium was conducted and submitted to the EPA contractor. We expect results in the next two months.
Mr. Mentch's team will be working on annual seasonal maintenance this summer. An additional five hydrants will be replaced this summer. He asked if there were any questions. None were forthcoming. Mr. Price explained to the Board that Mr. Mentch's team will have considerably more work upcoming because of the Schoolmarm tank being out of service this summer. Mr. May stated that Mr. Mentch has already been working overtime to get the new pump station and the Base 2 facility upgraded to prevent pressure spikes. The Board commended Mr. Mentch for doing an outstanding job. Mr. Mentch stated that his team is dialing in the new VFDs and pumps. Mr. Bowerman asked some questions about testing the new equipment, and he thanked Mr. Mentch for getting everything properly implemented.
Review and Acceptance of First Quarter Financials
Mr. Price reviewed the current assets and actual expenses versus budget. He reminded the Board that maintenance expenses normally occur during the next few months, so currently those are significantly below budget. He praised Mr. May for making good decisions on capital expenses and investments. There are no longer any CDs in the portfolio, and using ColoTrust exclusively for savings has resulted in a higher rate of return than the previous strategy. The financial situation at SRWD is very positive. Some discussion ensued about expected tap fees in 2023. ML Price asked if anyone had questions regarding any aspect of the District's financials. None were forthcoming.
Mr. Bowerman made a motion to accept the first quarter financials. It was seconded by Ms. Bloom. The motion passed unanimously.
Board Member Comments
Mr. May commented that at least one more Board member would be beneficial. He asked if anyone knows of a neighbor or friend in the District that could be a good fit. Mr. Teodoru stated that if anyone finds an interested and qualified person, we can have a special meeting to appoint that person to the Board. He said that we currently have a quorum, but another member would be good. Mr. Price reminded the Board that a candidate must be registered to vote in the state of Colorado.
Ms. Svenson reminded the Board that the dinner will be on June 18th. She will be emailing confirmation, and it is expected that Mr. Helmer will be attending.
Adjournment
Secretary Bloom made a motion to adjourn. It was seconded by Mr. Bowerman. The motion passed unanimously. Mr. Price adjourned the meeting at 5:00 p.m.
Respectfully Submitted,
Scott Price
Recording Secretary
Approved by the Board of Directors
Char Bloom
Secretary