Adjourned MEETING Minutes

BOARD OF DIRECTORS

MONTECITO WATER DISTRICT

583 San Ysidro Road, Montecito, CAlifornia

Tuesday, February 16 to Friday, February 19, 2010

9:00 a.M.

1. CALL TO ORDER, ROLL CALL, DETERMINATION OF QUORUM

President Morgan called the adjourned meeting to order at 9:00 a.m.

Directors Present:

Directors Jan E. Abel, Samuel Frye, W. Douglas Morgan, Richard Shaikewitz, and Larry Wilson

Directors Absent:

None

Staff Present:

Tom Mosby, General Manager

Toni Bailey, Business Manager

Lois Werner, Recording Secretary

Guest Present

Doug Brown, Bond Counsel

2. PUBLIC FORUM

There were no members of the public present who wished to speak on items not on the agenda.

3. CONSENT CALENDAR

This item was completed on February 16 and is noted in the minutes for that date.

4. Closed Session Items – Time Certain 2:15 p.m.

These items were completed on February 16 and are noted in the minutes for that date.

5. Cachuma MATTERS

A. COMB

1. meetings of December 2009 and January 2010

There was no report on the subject meetings.

2. 2008/09 UNEXPENDED BUDGET FUNDS

This item was completed at the meeting of February 16 and is noted in the minutes for that date.

3. SECOND PIPELINE PROJECT STATUS UPDATE

Mr. Mosby introduced this item and answered Directors’ questions.

B. CCRB

1. meeting of January 2010

No report.

2. Preliminary FY 2010/11 Budget

No report.

3. FORMAL NOTICE BY CARPINTERIA VALLEY WATER DISTRICT OF THEIR WITHDRAWL FROM CCRB FOR fy 2010/11

This item was completed at the meeting of February 16 and is noted in the minutes for that date.

6. LEGAL MATTERS

A. Recent and Pending Legal Matters REview – Oral Report

Mr. Wullbrandt was not present. Mr. Mosby distributed a letter received by the District from Price Postel & Parma concerning an increase in fees for legal service for 2010. It was the consensus of the Board to accept the increase in legal fees.

7. District Business Report

A) PROPOSED LONG TERM FIXED PAYMENT OBLIGATION REFUNDING

Mr. Mosby introduced this section and answered Directors’ questions.

1) proposed 1998A COP AND OTHER FIXED OBLIGations refunding scenarios

The Board discussed with staff and Bond Counsel the three proposed scenarios for refunding MWD fixed payment obligations, including the 1998A certificates of participation (COP’s). Following discussion, it was moved by Director Shaikewitz and seconded by Director Wilson and carried unanimously to select alternative 2A which provides for the refinancing of the District’s 1998A COP’s with a $1 million pay-down and principal payments beginning in 2023 and ending in 2030.

2) proposed 1998A certificates of participation refunding legal documents

Mr. Brown discussed with the Board the legal documents associated with refunding the 1998A COP’s. It was moved by Director Frye, seconded by Director Wilson and carried unanimously to approve as to form the legal documents associated with the refunding of the 1998A COP’s, with final documents subject to review by the President of the Board and the General Manager, for release to the rating agencies and potential buyers.

3) RESOLUTION 2066 – AUTHORIZING THE BOARD TO APPROVE THE EXECUTION AND DELIVERY OF REFUNDING REVENUE CERTIFICATES OF PARTICIPATION AND OTHER CERTAIN REFUNDING DOCUMENTS.

Mr. Mosby distributed, and the Board reviewed, a revised Resolution No. 2066 with figures inserted to reflect the selection of scenario 2A as noted above. Following discussion, it was moved by Director Frye, seconded by Director Wilson, and carried by the following roll-call vote to adopt Resolution No. 2066 as revised and amended.

AYES: Directors Abel, Frye, Morgan, Shaikewitz, and Wilson

NOES: None

ABSENT: None

ABSTAIN: None

4) bond counsel, bond Trustee and the financial adviser engagement letters and agreements

Mr. Mosby distributed a revised letter of agreement for Bond Counsel. Following discussion, it was moved by Director Shaikewitz, seconded by Director Frye, and carried unanimously to authorize the General Manager to execute agreements in relation to the 1998A COP refunding with:

Bond Counsel — Doug Brown; Stradling, Yocca, Carlson & Rauth

Financial Advisor — Fieldman Rolapp & Associates

Bond Trustee — Bank of New York Mellon

(Director Wilson left the meeting at this point.)

B) JPIA Insurance Refund

Ms Bailey introduced this item and answered Directors’ questions.

C) Electronic Billing Enrollement Form

Ms Bailey introduced this item and answered Directors’ questions. Following discussion it was the consensus of the Board to implement the electronic billing program and direct staff to work with the Public Information Committee to publicize this service.

D) District Business Banking

Ms Bailey introduced this item and she and Mr. Mosby answered Directors’ questions. Following discussion it was the consensus of the Board that staff should research business banking services with Wells Fargo Bank and bring a recommendation to the Board at the March 16, 2010 meeting.

E) Employee Fidelity Bond

Ms Bailey introduced this item and answered Directors’ questions. Following discussion, it was the consensus of the Board that staff should not pursue this matter any further.

F) December 2009 Revenue and Expense Report

Ms Bailey presented this report and answered Directors’ questions.

G) Water Sales Report for January 2010

Ms Bailey presented this report and answered Directors’ questions.

H) Quarterly Investment Report

Ms Bailey presented this report and answered Directors’ questions.

8. district Operations Report

A. Time Certain – 4:00 pm: PROPOSED MWD / CVWD SERVICE BOUNDARY REORGANIZATION

This item was completed at the meeting of February 16 and is noted in the minutes for that date.

B. Unaccounted Water and Action Status REport

Mr. Mosby reported on the status of this ongoing project.

C. Ortega Reservoir Cover Project – Final REport on Reservoir Property Landscaping Improvements

Mr. Mosby introduced this item and answered Directors’ questions. Following discussion it was moved by Director Frye, seconded by Director Shaikewitz, and unanimously carried that the General Manager formally notify COMB and the Carpinteria Valley Water District that a final inspection of the landscaping improvements surrounding Ortega Reservoir was completed on January 11, 2010 and that all plantings and landscaping improvements have been inspected and approved at the end of the landscape contractors’ two-year maintenance period.

D. Water Works Operation Report

Mr. Mosby distributed the Water Works Operation Report which was not available at the time the agenda packets were distributed, due to the absence of the necessary data from COMB.

9. GENERAL MANAGER’S REPORT

Monthly Operations Report (Oral)

(1) Distribution Department

(2) Treatment Department

(3) miscellaneous

Mr. Mosby reported on District activities not covered elsewhere in the agenda. He noted that the north valve at Juncal Dam will need to be rehabbed in September (the south valve was done a year ago).

10. DIRECTOR, COMMITTEE AND STAFF MEETING REPORTS

A. SANTA BARBARA COUNTY SPECIAL DISTRICTS ASSOCIATION MEETING OF January 25, 2010

Director Wilson left the meeting early and was not present to report on the subject meeting.

B. OPERATIONS COMMITTEE

Directors Frye and Shaikewitz reported that the activities of the Operations Committee had been covered elsewhere in the agenda.

C. FINANCE COMMITTEE

Director Morgan reported that the activities of the Finance Committee had been covered elsewhere in the agenda.

D. PUBLIC INFORMATION COMMITTEE

Director Morgan reported that the Public Information Committee met to interview a representative from Olympus Press. District will be giving Olympus Press an assignment to see how well they do.

11. AGENDA ITEM REQUESTS

There were no requests from Directors for items other than regular agenda items for the next regular Board meeting scheduled for March 16, 2010.

12. ADJOURNMENT

There being no further business to come before the Board, the meeting was adjourned at 11:07 a.m.

Approved:

_____________________________

W. Douglas Morgan, President

Attest:

__________________________________

Tom Mosby, Secretary