REGULAR MEETING Minutes

BOARD OF DIRECTORS

MONTECITO WATER DISTRICT

583 SAN YSIDRO ROAD, MONTECITO, CALIFORNIA

TUESDAY, June 15, 2004

2:00 p.M.

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

President Drewry called the meeting to order at 2:00 p.m.

Directors Present:

President W.W. Drewry

Directors Jan E. Abel, Robert W. Puddicombe, Robert M. Edmonston, and Larry Wilson

Directors Absent:

None

Staff Present:

Bob Roebuck, General Manager

Tom Mosby, Engineering Manager

Evalyn Kerman, Business Manager

Dave Johnson, Ortega Project Manager

Chip Wullbrandt, District Counsel, Price, Postel & Parma

Mark Manion, District Appeals Counsel, Price, Postel & Parma

Lois Werner, Recording Secretary

Guests Present:

Robert Wignot, COMB General Manager

Richard Monk, Lingate Mutual Water Company

Andree Harmez, Lingate Lane (Lingate MWC)

Leo Robidoux, Lingate Lane (Lingate MWC)

Perry H. Fergusen, E. Valley Rd. (Lingate MWC)

Paula Ferguson, E. Valley Rd. (Lingate MWC)

Martha Scheck, Stone Meadow Ln.

Richard Love, Montecito Association

2. PUBLIC FORUM

There were no members of the public present to speak on subjects not on the agenda.

3. CONSENT CALENDAR

Following Board discussion, it was moved by Director Puddicombe, seconded by Director Wilson, and unanimously carried to approve the consent calendar as presented.

4. Time Certain Items

A. 2:00 p.m. — Appeal of Water Charges— Mr. Ellis Taylor, ACCOUNT NO. 0901510

Mr. Roebuck introduced this item and reviewed the staff recommendations. Director Abel reported on the Appeals Committee meeting held on June 1, 2004 to hear Mr. Taylor’s appeal. Following Board discussion, it was moved by Director Wilson, seconded by Director Edmonston, and unanimously carried, to find, on the basis of the evidence presented, that Mr. Taylor is responsible for all water that passed through his MWD meter and deny his appeal for adjustment to his February water bill of $347.71.

B. 2:15 P.M. — Appeal of Charges for Water Used by Lingate Mutual Water Company, Account NO. 0807490

Prior to the introduction of this item, President Drewry recommended, on behalf of the Appeals Committee, that the Board not consider the meter removal portion of the recommendations until such time as the Appeals Committee can meet again to consider Mr. Monk’s response. Mr. Roebuck introduced this item and reviewed the staff recommendations. Director Abel reported on the Appeals Committee meeting held on May 21, 2004. President Drewry introduced Mr. Monk, representing Lingate Mutual Water Company, who presented arguments for retaining Lingate’s standby meter.

Following Board discussion, it was moved by Director Wilson, seconded by Director Abel, and unanimously passed to find, on the information presented, that Lingate Mutual Water Company is responsible for any water that passes through the MWD meter and that the assessment of a late charge on Lingate’s account was fair and equitable, and to deny the appeal for forgiveness of Lingate’s $6,807.93 September 2003 water bill, together with the $543.29 late charge. The Board referred the issue of the removal of Lingate’s standby meter back to the Appeals Committee.

C. 4:00 P.m. — COMB Draft 2004/05 Budget; Robert Wignot, COMB General Manager

President Drewry introduced Mr. Wignot, who discussed with the Board the COMB Draft 2004/05 Budget as presented in their agenda packets, and answered Director’s questions.

5. district Operations Report

A. Ortega Water Quality Project, Report by David H. Johnson (Oral)

Mr. Johnson distributed a memo on the public meeting on the Notice of Preparation (NOP) of the EIR and a progress report on the environmental project so far. Penfield and Smith is revising the design of the cover, in anticipation of the day when the EIR will be complete and the project may proceed. There is discussion on whether supplemental storage will be necessary at the site. If it is necessary, it will cost approximately $200,000 and will take up the majority of the space at the site which has been reserved as a staging area for the construction. For basic water service, the supplemental storage will not be required, but some alternate means of providing fire service should be explored. Mr. Mosby has had conversations with the Carpinteria-Summerland Fire Protection District and the water available through the intertie of existing District lines may be adequate.

Costs have been obtained from Conservatek in the matter of possible finishes which can be put on the aluminum roof.

Mr. Johnson reported that the public meeting held June 8 on the Notice of Preparation went well. Mr. Johnson distributed the minutes of that meeting to the Directors. The comment period for the NOP will expire at the end of June, and the administrative draft of the EIR should be ready for distribution to District staff in early July.

Mr. Johnson answered Directors’ questions.

B. Ortega Reservoir PROJECT COMMUNICATIONS Services Proposals from Rauch Communication Consultants

Mr. Roebuck presented this item and answered Directors’ questions. Following Board discussion, it was moved by Director Puddicombe, seconded by Director Edmonston, and carried by a vote of four to one to approve Rauch Communication Consultants’ proposals dated May 19 and June 4, 2004 for $12,500 and $4,500, respectively.

C. Ortega Reservoir Project Extra Services Proposal from Padre and Associates For County Permits

Mr. Roebuck introduced this item. Following Board discussion, it was moved by Director Edmonston, seconded by Director Puddicombe, and unanimously carried, to approve the proposal from Padre and Associates, dated June 10, 2004, for $16,000 for environmental services associated with the County permitting process for the Ortega Reservoir Project.

D. Groundwater Well Program Status Report

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

E. Status Report on Construction / Maintenance Projects

1. North Jameson Lane Bikeway

2. Ivydene Water Main Extension

3. Ennisbrook Well #3 Abandonment

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

6. Business and Finance

A. Potential Electrical Energy Cost Savings

Mr. Roebuck introduced this item, which is estimated to save up to $38,000 per year, and answered Directors’ questions.

B. Ratification of Association of Water AGencies of Santa Barbara County Budget

Mr. Roebuck introduced this item. Following Board discussion, it was moved by Director Puddicombe, seconded by Director Abel, and unanimously carried to ratify the Association of Water Agencies of Santa Barbara County 2004/05 Budget as presented, and approve the amendment to the joint Powers Agreement with respect to the agency’s treasurer.

C. Proposed 2004/05 District Budget

Mr. Roebuck presented the 2004/05 Budget and answered Directors’ questions. Following Board discussion, it was moved by Director Wilson, seconded by Director Edmonston, and unanimously carried to approve the 2004/05 Budget as presented.

D. Engagement of District Auditor

Mr. Roebuck presented this item. Following Board discussion, it was moved by Director Abel, seconded by Director Wilson, and unanimously carried to approve the engagement of MacFarlane, Faletti and Company to perform the annual District Audit.

7. ORDINANCES and Resolutions

It was moved by Director Abel, seconded by Director Puddicombe, and unanimously carried to approve Resolutions Nos. 1970 through 1983 on one vote.

A. Resolution No. 1979 — Employee Classification and Salary Schedule