August 2009

Board Meeting Date:  August 31, 2009 ~ 4:00 p.m.

PERSONS PRESENT: Gary Winchester, Buzz Ahrens, Gene Cornelison, Eric Wilmarth, Nancy Martin, Steven Woodruff, Chris Wilbanks, Tom Heard, Janice Henderson, David Kubala, Bill Graham, Tom Roach, Wesley Banks, Rick Dobbs, Ryan Sarks, Dan Carson, Mike Venters, Jeff Hooper, Clint Blackwell, Dwayne Fowler, Randy Mitchell, Dwight Turner, Mike Morrissey, Ron Banks, Beth Williams, Gene Hobgood, Craig Ferguson, Curtis Hamrick, and Mike Gravely.

Gary Winchester, Chairman, called the meeting to order.

1. AN INVOCATION WAS GIVEN BY GENE CORNELISON, FOLLOWED BY THE PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA.
2. TOM HEARD REFERENCED CORRESPONDENCE RECEIVED FROM AUTHORITY CUSTOMER BENNIE DARNELL. Mr. Darnell stated that on 7/11/09, a Cherokee County water main burst on Hickory Flat Highway. Mr. Darnell noted that a Cherokee County police officer was sent to the sight per a 911 call. Mr. Darnell noted that the water ran for several hours, which caused his commercial building (Donley’s Music) to flood. Mr. Darnell noted that, as a result, a major wall of the building has collapsed and damage has been incurred that will be costly to repair. Mr. Darnell noted that his insurance company has stated that the Authority should be responsible for the damage incurred. Mr. Darnell noted that even if his insurance company pays for the damage, Mr. Darnell will still have to pay a hefty deductible.

   Mr. Darnell is requesting that the Board consider compensating him for the damage incurred.

   Tom Roach noted that the Authority is awaiting a response from Mr. Darnell’s insurance company, based upon denial by the Authority’s insurance company.

3. TOM HEARD REFERENCED CORRESPONDENCE RECEIVED FROM AUTHORITY CUSTOMER ROGER HALLFORD. In this correspondence, Mr. Hallford stated that he purchased a new home in Hampton Station in November 2008. Mr. Hallford stated that the builders are having problems with the manner in which sod was laid. The builders reached an agreement with the sod installation sub-contractors to provide a remedy on five of the lawns. Their remedy provided for them to furnish at their expense two water hoses, two sprinklers, and three months of lawn maintenance involving certain corrective measures, including weed treatments and nitrogen applications. In addition, the lawn was to be watered thoroughly by the homeowner every other day.

   Mr. Hallford noted that the additional lawn watering caused an increase in his waste consumption. Mr. Hallford noted that he proceeded to pay his June utility bill of $307.10, which consisted of charges of $140.20 for water, $163.40 for sewer, and $3.50 for street lights. Mr. Hallford requested that his sewer charge be decreased to $40.00.

   MOTION BY ERIC WILMARTH AND SECOND BY NANCY MARTIN TO DENY THIS REQUEST. All members voted for the motion.

4. TOM HEARD REFERENCED CORRESPONDENCE RECEIVED FROM AUTHORITY CUSTOMER W.P. WEBB, JR. In this correspondence, Mr. Webb stated that he is a new resident of Cherokee County. He recently received an above-average water bill. Thinking that he might have a major leak in the system, Mr. Webb found upon investigation that his sprinkler system was improperly programmed. Mr. Webb had changed the existing settings for a different start and run time on his sprinkler system. This caused both programs to run, which created the large amount of water usage. Mr. Webb requested a reduction of his water and sewerage fees. Mr. Webb noted that his sprinkler system is now properly programmed.

   MOTION BY ERIC WILMARTH AND SECOND BY GENE CORNELISON TO DENY THIS REQUEST. All members voted for the motion.

5. TOM HEARD NOTED THAT THE FOLLOWING COMMENT WAS RECEIVED FROM AUTHORITY CUSTOMER KAREN WRIGHT: “Today I opened my water bill to discover it is almost $100.00 more than my average bill. After looking carefully, I realized we did use extra water this month with watering, pool, etc. However, the cost of the water and sewer was almost one hundred dollars more than the extra we used. This is outrageous! I can understand a small increase, but our sewer went up $53.00 alone! I know that the taxpayer gets the fallout from the lack of money in the city budget, but citizens around the county, state, and country are struggling to pay what they currently have…this increase just made paying you even more difficult. Your customers don’t have the luxury of putting our bill increases onto someone else when we lost money because of the economy. Why should the CCWSA? I can cut back on water, but that won’t change the unbelievable increase in sewer charges. I’m not sure if I have any choice in my water service, but I will have to start looking.”
6. TOM HEARD REFERENCED CORRESPONDENCE RECEIVED FROM AUTHORITY CUSTOMER JEFFREY COWLEY. In this correspondence, Mr. Cowley requested reimbursement of the $150.00 after-hours service charge assessed to his account.

   MOTION BY NANCY MARTIN AND SECOND BY CHRIS WILBANKS TO DENY THIS REQUEST. All members voted for the motion.

7. DAN CARSON PRESENTED A REQUEST FOR 2009-2010 GENERAL SERVICES FUNDING AND SELECTION FOR THE PERIOD 10/31/09-10/31/10. Mr. Carson recommended funding allocation for the following:

   PBS&J $400,000.00

   Brown & Caldwell $ 50,000.00

   Infratec $ 50,000.00

   MOTION BY ERIC WILMARTH AND SECOND BY GENE CORNELISON TO APPROVE 2009-2010 GENERAL SERVICES FUNDING AND SELECTION FOR THE PERIOD 10/31/09-10/31/10 AS OUTLINED ABOVE. All members voted for the motion.

8. DAN CARSON PRESENTED CONTRACT CHANGE ORDER NUMBER FIVE (FINAL) FOR THE FITZGERALD CREEK WPCP EXPANSION TO 6.0 MGD. Mr. Carson noted the contractor for this project is 3-D Enterprises Contracting Corporation, and reported a total change order of -$853,111.26. Mr. Carson reported a previous contract price of $51,965,336.00 and a revised contract price of $51,112,224.74.

   MOTION BY CHRIS WILBANKS AND SECOND BY GENE CORNELISON TO APPROVE CONTRACT CHANGE ORDER NUMBER FIVE (FINAL) FOR THE FITZGERALD CREEK WPCP EXPANSION TO 6.0 MGD IN THE AMOUNT OF -$853,111.26. All members voted for the motion.

9. MOTION BY GENE CORNELISON AND SECOND BY ERIC WILMARTH TO APPROVE THE 7/27/09 BOARD MEETING MINUTES AS PRESENTED. All members voted for the motion.
10. JANICE HENDERSON PRESENTED THE FINANCE REPORT. Mrs. Henderson reported that total operating revenues are approximately $2,006,220.00 under budget for the period ending 6/30/09. Mrs. Henderson also reported total operating expenses are approximately $1,871,134.00 under budget for the same period. Mrs. Henderson stated that income from operations is approximately $135,086.00 under budget, and reported a year to date net income of $1,775,978.00 as of 6/30/09.
11. JANICE HENDERSON REPORTED THAT THE PROPOSED 2010 BUDGET INCLUDES A LINE ITEM FOR OTHER POST EMPLOYMENT BENEFITS (OPEB).

    Ryan Sarks stated that, in an effort to comply with the Governmental Accounting Standards Board (GASB), statement 45, the Cherokee County Water & Sewerage Authority has completed a third party actuarial valuation of Other Post Employment Benefits (OPEB) and has chosen to participate in an irrevocable trust fund offered through the Georgia Municipal Employee Benefits System (GMEBS). This trust fund will be instituted in a similar fashion as the current GMEBS retirement trust fund and will ensure that the funds are available for the CCWSA’s portion of retiree healthcare premiums well into the future. In addition, by valuating the future liabilities of the OPEBs, the report determines the implicit subsidies from an active employee base towards a group of retirees receiving Other Post Employment Benefits and enables the employer to deposit said subsidies and future premiums into the above referenced irrevocable trust fund. Monies deposited into the irrevocable trust fund will earn interest into the future and potentially reduce projected contributions the CCWSA would otherwise be obligated to fund.

    With the old pay-as-you-go setup, actual OPEB costs were not realized until employees retired, which created enormous liabilities as the retiree base expanded. These liabilities then had to be recorded on the financials. This irrevocable trust fund will be funded in lieu of the traditional pay-as-you-go setup.

    MOTION BY NANCY MARTIN AND SECOND BY ERIC WILMARTH TO APPROVE THE ESTABLISHMENT OF A TRUST FUND FOR OPEB FOR EMPLOYEE RETIREE HEALTH INSURANCE. All members voted for the motion.

12. JANICE HENDERSON PRESENTED THE PROPOSED BUDGET FOR FISCAL YEAR 2010. Revenues, expenses, bond coverage, and net income projections were discussed.

    MOTION BY GENE CORNELISON AND SECOND BY NANCY MARTIN TO APPROVE THE PROPOSED 2010 BUDGET AS PRESENTED. All members voted for the motion.

13. INSURANCE COMMITTEE MEMBER NANCY MARTIN REPORTED CONCERNING THE RESULTS OF THE PROPOSALS FOR THE AUTHORITY’S PROPERTY/CASUALTY AND WORKERS COMPENSATION INSURANCE. Mrs. Martin noted that this coverage renews 9/1/09.

    MOTION BY NANCY MARTIN AND SECOND BY ERIC WILMARTH TO AWARD THE PROPOSAL FOR THE AUTHORITY’S WORKERS COMPENSATION INSURANCE COVERAGE TO BUILDERS INSURANCE THROUGH THE CURRENT CARRIER, HAMRICK INSURANCE AGENCY, IN THE AMOUNT OF $102,006.00, BASED UPON THE LOW BID RECEIVED. All members voted for the motion.

    MOTION BY NANCY MARTIN AND SECOND BY CHRIS WILBANKS TO AWARD THE PROPOSAL FOR THE AUTHORITY’S PROPERTY/CASUALTY INSURANCE COVERAGE TO ONE BEACON INSURANCE THROUGH THE MCCART GROUP, IN THE AMOUNT OF $280,555.00, WHICH INCLUDES AN ENDORSEMENT FOR TERRORISM IN THE AMOUNT OF $2,449.00, BASED UPON THE LOW BID RECEIVED. All members voted for the motion.

    MOTION BY NANCY MARTIN AND SECOND BY CHRIS WILBANKS TO REQUEST COVERAGE THROUGH ONE BEACON FOR SEXUAL ABUSE AND MOLESTATION, AT AN ADDITIONAL COST OF $5,625.00. THEREFORE, THE GRAND TOTAL OF THE PREMIUM THROUGH ONE BEACON IS $286,180.00. All members voted for the motion.

    Nancy Martin noted that, with approval of the proposal of One Beacon, the Authority will realize savings of slightly less than $120,000.00 from the current carrier.

    Tom Heard extended appreciation to the Insurance Committee and to Al Sherling of Insurance Review & Management for their assistance with this issue.

14. CLINT BLACKWELL PRESENTED THE WATER TREATMENT OPERATIONS REPORT. Mr. Blackwell reported an average daily treatment of 16.86 MGD for the month of August at the Etowah River Water Treatment Facility. Mr. Blackwell also reported that the Hollis Q. Lathem Reservoir is full at 1189 feet.
15. MIKE VENTERS PRESENTED THE WASTEWATER TREATMENT OPERATIONS REPORT. Mr. Venters reported an average daily treatment of 1.991 MGD at the Rose Creek facility, and an average daily treatment of 3.570 MGD at the Fitzgerald Creek facility.
16. BILL GRAHAM PRESENTED THE CONSTRUCTION REPORT. MR. GRAHAM REQUESTED APPROVAL FOR DESIGN AND BIDDING OF THE BRAMBLE OAK SUBDIVISION WATER MAIN REPLACEMENT PROJECT. Mr. Graham noted that this project consists of replacing approximately 10,300 lineal feet of existing 6” PVC water main with 8” DIP water main and changing over services to 163 residential houses. Mr. Graham reported a preconstruction engineering estimate of $42,000.00 for this project.

    MOTION BY STEVEN WOODRUFF AND SECOND BY NANCY MARTIN TO APPROVE THE DESIGN AND BIDDING OF THE BRAMBLE OAK SUBDIVISION WATER MAIN REPLACEMENT PROJECT. All members voted for the motion.

17. TOM HEARD PRESENTED THE GENERAL MANAGER’S REPORT. MR. HEARD REPORTED THAT MAYOR JIM STILL OF THE CITY OF MOUNTAIN PARK IS REQUESTING A MEETING WITH MR. HEARD AND THE AUTHORITY’S BOARD OF DIRECTORS REGARDING THE LACK OF FIRE HYDRANTS ALONG THE STREET OF CARDINAL COVE IN THE CITY OF MOUNTAIN PARK. Mr. Heard noted that this project, pending Board approval, could be added to the Authority’s Future Projects Listing.

    Bill Graham noted an estimated cost of $85,000.00 for the water main upgrade (with hydrants) on Cardinal Cove, which consists of the following:

    $60,000.00 1000 Lineal Feet of 8” Ductile Iron Pipe (at $60.00 per foot)

    $25,000.00 Design, Bid, and Inspection

    Bill Graham recommended that the Authority consider upgrading the water main on both Mountain Park Road and Cardinal Cove (with hydrants), at an estimated cost of $175,000.00, which would consist of the following:

    $150,000.00 2500 Lineal Feet of 8” Ductile Iron Pipe (at $60.00 per foot)

    $25,000.00 Design, Bid, and Inspection

    Bill Graham noted that in both scenarios listed above, the existing 2 ½” pvc line would be replaced with 8” ductile iron pipe. Mr. Graham noted that estimated costs for this project are based upon costs of the existing Stockwood project.

    MOTION BY ERIC WILMARTH AND SECOND BY NANCY MARTIN TO APPROVE THE DESIGN AND BIDDING OF THE MOUNTAIN PARK ROAD AND CARDINAL COVE WATER MAIN REPLACEMENT PROJECT. All members voted for the motion.

18. TOM HEARD PRESENTED A REQUEST FROM DONNIE HENRIQUES, MAYOR OF THE CITY OF WOODSTOCK, CONCERNING WOODSTOCK COMMUNITY CHURCH. In the correspondence received from Mayor Henriques, Mayor Henriques stated that the Woodstock City Council had voted to allow Woodstock Community Church to tie on to CCWSA’s water and sewer lines, even though they fall within the City of Woodstock’s service delivery area. It appears that the nearest location in which to tap onto the City’s sewer line is approximately 2400 feet away, and would create a financial hardship on the Church. For sake of convenience, the Council is also allowing them to tie on to the Authority’s water line so they will receive one monthly bill for water and sewer service.

    Mayor Henriques noted that the City understands this approval technically amends the City’s service delivery agreement with the Authority.

    MOTION BY ERIC WILMARTH AND SECOND BY GENE CORNELISON TO AMEND THE AUTHORITY’S SERVICE DELIVERY AGREEMENT WITH THE CITY OF WOODSTOCK TO INCLUDE TAX MAP 15N11, PARCELS 48, 48A, and 49. All members voted for the motion.

19. MOTION BY ERIC WILMARTH AND SECOND BY BUZZ AHRENS TO ADJOURN. All members voted for the motion.

The meeting adjourned at 5:20 P.M.