Tuesday, January 20, 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, JANUARY 20, 1998

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

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

Director Campbell made a motion to approve the minutes of January 6, 1998. It was seconded by Director Abel. The motion carried unanimously.

The Board reviewed the water sales report for December 1997. The General Manager said that the District was under budget for the month of December but on target for the year.

The General Manager reviewed with the Board the water works operation report. President Puddicombe asked the General Manager if the reason for the large discrepancy in last month’s water works report had been determined. The General Manager said that it had not but that District staff was still researching this.

A motion was made by Director Campbell, seconded by Director Jones and unanimously carried to ratify the January 14, 1998 transfer of $500,000 from the District’s LAIF/General Capital Repair & Replacement/Operations fund account to the District’s Montecito Bank & Trust operational account.

A motion was made by Director Abel, seconded by Director Jones and unanimously carried to approve the bills for payment for December 1997.

The General Manager said that he had attended the last Montecito Association meeting and that the Montecito Association had asked if the District would place an insert regarding the announcement of the Montecito Association’s 50th anniversary with the bills. Director Abel made a motion to allow the Montecito Association’s 50th anniversary announcement to be placed with the District’s bills and that the Public Information Committee review this insert prior to that time. It was seconded by Director Campbell. The motion carried unanimously.

There was a discussion among the Board members on whether or not any Director should serve on both the Finance and Operations committees at the same time since these are considered key committees. After discussion Director Campbell moved to approve the committee and regional Board assignments with a review of these assignments in six months. It was seconded by Director Abel. The motion carried unanimously.

POSTPONE CONSIDERING PLACE, DATE AND
TIME OF BOARD MEETINGS AND DISCUSSION OF LONG RANGE PLAN
AND SCHEDULING OF PUBLIC HEARING

Director Campbell made a motion to 1) postpone considering the place, date and time of the regular Board meetings and 2) to postpone the discussion of the Long Range Plan and the scheduling of a public hearing regarding rates and fees to February 3, 1998, when the whole Board can be present. The motion was seconded by Director Jones. The motion carried unanimously. The General Manager said that Director Abel will be out of town for the Feb. 17th Board meeting and that in order to have the whole Board present for the public hearing, it was proposed that a special meeting would be held on February 24th.

Director Abel asked that the information for the public hearing be placed in the February 3rd Board packet so that Board members would be able to review it, and that a recommendation from the Finance Committee be made at that time. Director Campbell made a motion to adjust the Directors’ compensation for a cost of living increase of 3%. The motion was seconded by Director Jones. The motion carried unanimously.

Director Campbell made a motion to terminate the Water Exchange Agreement with the Carpinteria Valley Water District and for Carpinteria Valley Water District to reimburse the District for this water in the amount of $8,700. It was seconded by Director Puddicombe. The motion carried unanimously.

DISTRICT DIVERSIONS AT FOX AND ALDER CREEKS AND INADVERTENT RELEASE OF SEDIMENT TO ALDER CREEK

The Board reviewed the letters from the Forest Service to the District and the District’s response to these letters regarding the diversions at Alder and Fox Creeks, and the inadvertent release of sediment to Alder Creek. The General Manager said that he would be writing a response to the January 9th letter from the Forest Service. Director Abel asked that Counsel review this letter prior to sending it. The Engineering Manager said that the Forest Service has been very cooperative with the District, and he will be inspecting the cleanup of the sediment with them. The Forest Service was concerned that this does not occur again in the future and it has been proposed that pre-construction meetings with all parties should be held onsite prior to the start of work. Director Campbell asked that incorrect statements regarding endangered species made by the Forest Service in its letter dated January 9th be corrected in the District’s response letter. Staff will prepare a letter and Counsel will be asked to review it. In addition, the USFS will be asked to meet with the District soon to give its quarterly report relative to our joint contract.

The General Manager reported that the Fox Creek diversion was turned on at 11:45 a.m. on January 12, 1998. The initial diversion rate was .12 CFS. Monitoring on Fox Creek will continue while the diversion continues.

The Business Manager explained that the District currently receives reports from the DMV on employees and directors. ACWA/JPIA would like the District to go one step further and develop a Driver Disciplinary Procedure Policy. ACWA/JPIA has recommended that directors be included. Director Jones expressed some concern over the responsibilities of the directors and requested that this be clarified. It was the consensus of the Board to postpone this item and ask staff and Counsel to clarify this policy.

There was no interest expressed by the Board for nomination to the ACWA/JPIA 1998 Executive Committee. Director Abel announced that Counsel Wullbrandt had been nominated to the ACWA State Legislative Committee and the Federal Affairs Committee.

The General Manager said that the only change in the Agreement for the Santa Barbara Bank and Trust Construction Loan was the change in the maturity of the loan from 2001 to 2002. Director Campbell made a motion to approve the change in the terms of the Agreement for the Santa Barbara Bank and Trust construction loan. It was seconded by Director Jones. The motion carried unanimously.

The Board discussed the recommended change in the accounting method for the State Water Project loan from the equity method to the cost basis method. The Business Manager said that the City of Santa Barbara and CCWA had already switched to this accounting method. After discussion this item was continued until the next meeting after the Finance Committee has reviewed this.

The Business Manager explained that 40% of the Water Conservation questionnaires that were sent to District customers have been returned. She explained that these questionnaires were to evaluate the effectiveness of the District’s water conservation programs. A finding was that most single family residences have at least one low flow toilet.

A motion was made by Director Campbell, seconded by Director Jones and unanimously carried to approve the 1996/97 USBR Annual Update Report.

A motion was made by Director Campbell, seconded by President Puddicombe and unanimously carried to not respond to the USBR regarding the DWR Urban Water Management Plan Evaluation.

Director Abel gave the COMB report. She said that Phase II of the Cachuma seismic safety work is due to begin in May. The dam gates will be painted after the modifications for the seismic work are completed. She also said that the Board had discussed the construction of a new office building which is expected to cost between $450,000-500,000. The Board indicated they would like to be presented with more information before they could approve contributing to this proposed construction.

Director Abel stated that CCRB had not yet met so there was nothing to report at this time. She noted that the Board packet contained a report on the status of the studies and pending legal issues.

Director Campbell stated that the LAFCO meeting of January 8, 1998 had been canceled.

President Puddicombe said there was nothing to report under the Operations Committee.

Director Campbell reported that the Finance Committee had reviewed the tenant policy. The Finance Committee had also reviewed the cash flow which showed a projected gain of $605,000 for the year.

Director Abel said there was nothing new to report for the Public Information Committee.

President Puddicombe said that the Water Marketing Committee had met and had discussed the sale of surplus water and that District finances should be planned as if the water were not going to be sold. The Committee also discussed the proposed CCWA turnback pool water policy and noted that this will be voted on Thursday at the CCWA.

Director Campbell asked that a report on the Special Districts Association Meeting of January 26, 1998 and the LAFCO Meeting of February 17, 1998 be placed on the next agenda.

The Board went into closed session at 5:10 p.m. When the Board returned to open session at 5:20 p.m. it was reported that no action had been taken.

Note: The agenda for this meeting was posted at the front counter and outside front wall at the Montecito Water District on January 16, 1998.