Tuesday, September 1, 1998

MINUTES OF A REGULAR MEETING
of the
BOARD OF DIRECTORS OF THE MONTECITO WATER DISTRICT
held at the
DISTRICT BOARD ROOM
583 SAN YSIDRO ROAD, MONTECITO, CALIFORNIA
at 3:00 p.m. on TUESDAY, SEPTEMBER 1, 1998

The meeting was called to order by President Puddicombe at 3:00 p.m.
Those in attendance were:

Present:	Directors Abel, Campbell, Puddicombe, Wilson
Absent:	Director Jones
Also Present:	C. Charles Evans, General Manager/Secretary Evalyn Kerman, Business Manager/Assistant Secretary Chip Wullbrandt, District Counsel Tom Mosby, Engineering Manager Cathy Muneio, Secretary Henry Robinson, District Customer

There were several suggested corrections to the minutes. A motion was made by Director Campbell, seconded by Director Wilson and unanimously carried to approve the amended minutes of August 18, 1998.

Director Abel reported on the appeal of Henry Robinson for repayment of plumbing bills totaling $352.50. She said that the Appeals Committee had visited the site and met with Mr. Robinson. Mr. Robinson claimed that his meter had been replaced by the District several times and that a District employee had suggested he call a plumber to replace the pressure regulator. The plumber replaced the pressure regulator and repaired his vacuum release valve, but the meter broke once again. He said that a District employee had told him that if his meter kept breaking he would be charged for staff time to replace the meter as well as the cost of the meter. After further discussion the Board determined that it was difficult to determine what the cause was for the meters breaking. However, the District had researched the cause for the meters breaking and it was not on the District’s side. A motion was made by Director Campbell, seconded by Director Wilson and unanimously carried to approve a credit to Mr. Robinson’s water account for one-half the amount of the plumbing bill or $176.25. Director Abel pointed out to Mr. Robinson that the customer is responsible for any event that happens on the customer’s side of the meter, and that it should be handled at the discretion of the property owner.

The Report on the distribution system and fireflow upgrade and capital programs projects and water availability charge and bond funds was reviewed. The General Manager reported that five pipelines would be going to bid in the very near future. The Business Manager said that the balance of the 1998A Bonds reflected the payoff of the Santa Barbara Bank and Trust loan.

A motion was made by Director Campbell, seconded by Director Wilson and unanimously carried to ratify the August 27, 1998 transfer of $300,000 from the SBBT account to the District’s LAIF account.

Director Wilson said that the Montecito Association had not met yet so there was nothing new to report.

The Business Manager reviewed the history of the Capital Cost Recovery Fee and how this fee was determined. She said that this fee enables current customers as well as future customers to pay for the capital projects that are completed within the District. She explained that the Board adopted a formula for an automatic percentage increase to begin this fiscal year for the next five years. Director Campbell requested that the Board consider making this increase become effective the date of the hearing if the Board agrees to increase it. The General Manager said that he was not asking for approval at this time but wanted to set the date for a public hearing. A motion was made by Director Campbell, seconded by Director Puddicombe and unanimously carried to: 1) consider the Finance Committee and staff report on the Capital Cost Recovery and Connection Fees, 2) conduct a Public Hearing at 3 p.m. at the regular Board meeting on September 15, 1998, and 3) following consideration of public comments from the Public Hearing, adopt a resolution establishing the District Capital Cost Recovery Fee and Connection Fee schedule.

The General Manager requested that the U.S. Forest Service payment request regarding the 1997-98 Challenge Cost Share Agreement and the request by the U.S. Forest Service for renewal of the Challenge Cost Share Agreement be continued until the next meeting. Director Wilson moved to continue this item to the next meeting. It was seconded by Director Campbell. The motion carried unanimously.

A motion was made by Director Wilson, seconded by Director Campbell and unanimously carried to ratify approving the Amendment to the SBWPA Joint Powers Agreement to elect officers biannually.

The Board reviewed the letters to Assemblyman Firestone and Senator O’Connell thanking them for their support of Assembly Bill 2383. Director Campbell said that Assemblyman Firestone had decided not to run in the November election and made a motion to send a letter of appreciation for his service to the District. The motion was seconded by Director Wilson. The motion carried unanimously.

The General Manager reported on the CCWA continuing disclosure workshop held on August 20, 1998. This workshop was held since several agencies were having trouble preparing information that was needed to be submitted to CCWA.

Director Wilson reported, at the Special Districts Association meeting of August 24, 1998, the Democrats running for the Assembly gave a talk. Director Wilson requested that President Puddicombe consider placing Director Campbell as the District representative to the Special Districts Association. President Puddicombe said that he would consider this request at a later date.

Director Abel reviewed with the Board the ACWA Board meeting of July 31, 1998 and the ACWA Region 5 Planning Meeting of August 27, 1998. She distributed and discussed with the Board several items that were the topics of discussions at these meetings.

Director Puddicombe said the Board packet included a written report from the CCWA Board meeting of August 27, 1998.

Director Puddicombe said that there was nothing to report since the Operations Committee had not yet met.

There were several items for approval that were discussed at the Finance Committee meeting.

A motion was made by Director Wilson, seconded by Director Campbell and unanimously carried to approve a District repayment schedule for the CCWA 1996 Revenue Bonds on a gradient basis.

Director Campbell said that the Finance Committee had reviewed the legal expenses and that they were not nearly as high as in the past. Director Abel asked the Board to consider not reviewing legal expenses separately since they were much lower than in previous years. Director Wilson said that he would like to see what previous legal costs were compared to now. Director Abel suggested that the Finance Committee review the necessity of this report.

The Board reviewed the letter from CCWA to First Trust California regarding the 1996/97 Annual Report on Continuing Disclosure. It was noted that several districts had failed to meet their coverage ratios.

Director Campbell reviewed with the Board the draft 1997-98 District Continuing Disclosure Report for CCWA. He noted that water deliveries were 20% lower than projected in December. He suggested that a footnote be added that this was the largest amount of rainfall ever recorded in Santa Barbara. Director Wilson asked why the increases in service charges were not based on equivalency. It was noted that they had started out that way but, with percentage increases, did not remain equivalent.

The General Manger said that the CCWA 1997-98 fourth quarter Investment Report was for information.

The Board reviewed the letter from Standard & Poor’s assigning the Montecito Water District a AAA rating with AMBAC.

Director Abel reported on the preparation of the next newsletter which will be the last newsletter of the year. She said it will include an environmental story and studies being conducted on the Santa Ynez River. There will also be a conservation article.

Note: The agenda for this meeting was posted at the front counter and on the front wall at the Montecito Water District on August 28, 1998.