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Good afternoon. 00:02:05
Welcome to the Port Wanami Water Agency regular meeting. I am calling this meeting to order. The time is now. 00:02:07
4:00 PM. 00:02:13
Madam Clerk, may we have a roll call, please? 00:02:15
Member Bouchard. 00:02:18
Member Perez here. Ex Officio Member Jacobson. 00:02:20
Period. 00:02:23
Vice Chair Dibley. 00:02:24
Ohh, he's absent for the record and chair Hernandez here. 00:02:26
Thank you. 00:02:31
I can't have this. John is here Ohh sorry. 00:02:32
Member McQueen Legion Member McQueen Lejean here. 00:02:39
OK. 00:02:44
Radon. 00:02:45
Great. Thank you. 00:02:46
I have to say something about this room. It just looks fabulous. I really, really like it. Thank you whoever was behind putting 00:02:47
this up and the kids who did the. 00:02:51
The decor and the art, that's wonderful. 00:02:56
OK. At this time, we'll take public comment. Any general public comments not pertaining to items on the agenda? 00:02:59
Zoom Participants Can you use the Raise Hand feature if you would like to make any comments. 00:03:07
And any comments made will. 00:03:12
Require that you provide them within 3 minutes. 00:03:15
So, Madam Clerk, do we have any public comments for this? 00:03:18
Meeting we have one public comment for Mr. Donald Villafana. 00:03:22
Hello, Don. 00:03:27
Good afternoon board. I think most of you know me. My name is Don Villafana. 00:03:32
And first, I'd like to say that from what I've seen and heard. 00:03:37
I think Dennis Martinez has been doing a great job as your water manager. 00:03:42
Second, I think we're all very, very grateful that we had a a wet year. 00:03:47
And that our reservoirs are filling up. 00:03:52
But one wet year. 00:03:55
Does not recharge our groundwater basins. 00:03:57
And in the next decade, PHWA will be faced. 00:04:00
With the declining allocation. 00:04:04
Of groundwater. 00:04:06
Right now. 00:04:07
PHWA operating the plant. 00:04:09
Loses approximately 350 acre feet a year to brine discharge. 00:04:12
And at between 700 and $750 an acre foot. 00:04:18
That comes out to. 00:04:23
Over $260,000 a year. 00:04:25
But more importantly. 00:04:28
That's 350 acre feet of lost water. 00:04:30
In addition. 00:04:35
This last year, the 600,000 gallon water tank. 00:04:36
Was inspected with divers. 00:04:40
And a report done and given to the state. 00:04:42
The state gave PHWA. 00:04:45
A three-year time limit to drain that tank. 00:04:47
And rehabilitate the interior. 00:04:51
But before that's done, consideration should be given. 00:04:54
To building a bypass at the plant. 00:04:57
So when that tank is down. 00:04:59
United water can be used. 00:05:02
Instead of going on the high dollar. 00:05:04
Cayugas. 00:05:07
Right now. 00:05:08
If that tank, to bypass that tank you have to open a valve. 00:05:09
Near Pleasant Valley. 00:05:13
In Ventura Rd. 00:05:15
And if you do that, you can run on United Water. 00:05:16
But you cannot monitor the chlorine residuals. 00:05:20
And that becomes a problem down the line. 00:05:23
So. 00:05:26
I believe next month. 00:05:27
MKN. 00:05:29
We'll be touching on these and probably other items for your consideration. 00:05:30
So I appreciate the opportunity to speak this afternoon. 00:05:35
And it's Mark Twain so eloquently put it. 00:05:39
You know, whiskey is for drinking and water is for fighting. 00:05:42
So thank you for your time this afternoon. Thank you. Thank you, Mr. Villafana. 00:05:46
Are there any other public comments? 00:05:51
That concludes public comment. OK, thank you. 00:05:53
We'll now move to agenda approval. May I have a motion and a second to approve the agenda? 00:05:56
Move to approve. 00:06:02
2nd. 00:06:04
Thank you. 00:06:05
Madam Clerk, we please take a vote. All in favour. 00:06:07
Aye, all opposed. Hearing none. Motion carries unanimously. 00:06:10
Thank you. 00:06:15
We are. 00:06:16
You have no presentations. 00:06:17
So we'll move on to the consent agenda. 00:06:19
Let's see, we've got the Minutes register of disbursements and. 00:06:24
PHW A Monthly operational. 00:06:27
Sports. 00:06:30
Move to approve the consent calendar. All items 1-2 and three unless the water general manager prepared to give oral report on 00:06:33
the. 00:06:38
Operation. OK, I'll move to approve all three. 00:06:44
2nd. 00:06:48
OK. 00:06:51
Motion the 2nd May we have a roll call vote please. 00:06:53
All in favour. 00:06:56
Aye, all opposed. 00:06:57
Hearing none motion carries unanimously, OK. 00:06:59
We brings us now to public hearings. There are no public hearings, so we'll move on to pensions under business items item 4, 00:07:02
Pension. 00:07:07
Other post employment benefit costs. 00:07:11
Yes, hi, good evening. Yes, I have a presentation to go over the information. So good evening Chair and board members. Today what 00:07:16
I want to do is go through these presentation for the PHWA. 00:07:23
Outstanding liability related to pension and other post employment benefits. 00:07:31
And just. 00:07:38
To provide a little bit of background, the Governmental Accounting Standards Board sets the rules for both pension and OPEC. 00:07:39
The Gatsby 68 is for pensions, basically dictating governments. 00:07:49
How pensions need to be reflected on the books. 00:07:54
For both governmental and enterprise funds and as well as Standard 75 Gatsby 65. 00:07:57
That relates to other benefits such as medical, vision, dental. 00:08:04
And what happens each fiscal year, we get the actual aerial reports for both of these components. 00:08:10
They're done separately. The pension is done, but CalPERS and then we have a outside actuarial that does the OPEC. 00:08:17
And then the auditors go through that and they take a look at what the city has paid. 00:08:24
For instance, with pensions, we pay on a monthly basis with payroll and then we also do. 00:08:29
An annual payment which the city has an option to either pay. 00:08:33
Monthly or annually for the unfunded liability, and so the auditors do their calculation and they determine and adjust the pension 00:08:37
liability on an annual basis. 00:08:41
Umm. 00:08:47
And. 00:08:48
What happened for the Enterprise Fund? So this is not just specific to the water plant fund. 00:08:50
The city had not recorded any pension. 00:08:55
Liability. 00:08:58
And or associated cost? 00:08:59
To the Enterprise Fund, so in fiscal year 2020. 00:09:02
Which was the year that we also had new auditors. The auditors that had been with the city, had been with the city for quite some 00:09:06
time. 00:09:09
The auditors adjust. They made an adjustment. 00:09:13
To restate the pension. 00:09:16
Liability and the pension cost for all of the enterprise funds. 00:09:19
And so that year the other funds, we reflected the cost on the books and reflected the liability. 00:09:23
For Fund 443, which is the water plant fund, we didn't do it because we wanted to bring it to the board, so we've been. 00:09:31
Discussing this item and has hasn't been. 00:09:37
Closed yet? 00:09:41
And when you look at 443 right now, the water plant fund has a negative. 00:09:42
Fund, balance the deficit, basically because. 00:09:47
They need an injection of cash. 00:09:50
To cure this negative fund balance. 00:09:53
And. 00:09:56
And the total amount that needs to be funded. 00:09:57
Umm. 00:10:00
From PHWA, is that number up there 932,417? 00:10:01
And so I wanted to show the balance sheet. 00:10:09
As of 2019. So the balance sheet is basically your statement as of a specific point in time. 00:10:12
And you can see that it doesn't include down in the liability section. So the the top of it is the assets, the cash. 00:10:17
That the fund has. 00:10:24
As of that date as of June 30th, 2019. And then down at the bottom there's liabilities. At the bottom you see where it says 00:10:26
there's no pay, there's no pension liability. 00:10:31
That year. 00:10:37
And. 00:10:38
And then fast the the second, the second attachment is the 2020 where the auditors booked the liability. 00:10:40
And. 00:10:47
The associated deferrals, so basically what they do, they take a look at the liability and also the assets of the. 00:10:48
Of the pension and that's why there's entries to both. 00:10:56
Assets and liabilities, but the bulk of the number is the liability, the the net pension liability, the $1.3 million that they 00:10:59
book. 00:11:03
Umm. 00:11:08
And at that point in time. 00:11:08
Actually I attached the liability because if you look at the bottom, the fund. 00:11:11
And you can see it from this the. 00:11:15
The fund is in a negative position and it still is as a. 00:11:18
June 30th as of now and as of June 30th. 00:11:23
2022 and that's because of that liability. 00:11:26
Umm. 00:11:31
And So what I did is I took a look at how that liability would be allocated based on. 00:11:32
The water usage for that fiscal year since that's the year that it was booked? 00:11:38
And City of Port Wanami would. 00:11:43
Be obligated for 53.95% or $503,000 and 903 O 9. 00:11:47
And then you can see the all the different customers and the percentage and again that's using the water usage as of. 00:11:54
That fiscal year when the liability was booked. 00:12:01
The recommendation is to have this liability paid. 00:12:08
Over a three-year period and equal installments or. 00:12:13
Three or less. 00:12:17
And to start getting. 00:12:19
Funding that Fund 443. 00:12:20
With the funds and get that negative fund balance. 00:12:23
20. 00:12:26
And then how this would work? It would not impact the monthly bills. 00:12:29
We would do it. When we do that through up, we do it through up every year. 00:12:34
And build the customers either the overage or under. 00:12:37
Based on the total consumption for the year. So then we could do that. 00:12:41
The adjustment. 00:12:46
At that time. 00:12:47
Was judicially in around October. 00:12:48
Because we close the books in June. 00:12:51
September, October is when we have the actual numbers to do that through. 00:12:54
Any questions? I know this is a big number and it's been on the books and it was discovered. 00:12:59
Really. Two years ago and? 00:13:06
But it is a big number. 00:13:10
I'm sorry, what was the last thing you just said? It was this, well, it was booked in two years ago in 2020 and it's a large 00:13:11
number because it was not, yeah, it was not booked in the past. 00:13:16
Thank you, Miss Sarah, are there any questions for staff? 00:13:22
Ohh, yes. 00:13:31
Member Bashar. 00:13:32
I want to thank staff of again for taking the time to to meet with us independent of this explain it. 00:13:34
And as I said during that meeting, I always hate being the person to bring forward a problem without a solution. It's it's a 00:13:41
challenging issue. This one is from. 00:13:45
The beach districts perspective and and we want to make sure that the city is made whole. 00:13:51
So I just want to make a couple of statements that I hope that. 00:13:56
I understand the city's moving forward with a new time recordation system where you'll be able to more adequately keep track of. 00:14:00
Time spent at the water treatment plant operations and then we make sure when we're looking at. 00:14:10
The fully burdened cost of the full time equivalents that are booked out to the plant. 00:14:15
That whether or not that fully burdened rate. 00:14:22
Include some portion of the pension benefit. 00:14:25
To to ensure whether it does or it doesn't, but that we're clear on those things. My concern going forward as I said. 00:14:29
It is to correct the issue. 00:14:36
The. 00:14:39
The the difficulty from the beach districts perspective. 00:14:40
Is and it's not not an issue that staff can correct today, and I recognize that and I want to say this in the most respectful way 00:14:44
because it's not anything anybody here did. 00:14:48
27 years have gone by of the accumulation. 00:14:54
A pension liabilities on the cities side. 00:14:57
That. 00:15:01
Weren't booked out OPAB. Some of these requirements are new government reporting requirements that that that's the result of the 00:15:02
audit finding. 00:15:06
No fault of anybody here and I'm respectful of that. 00:15:10
However. 00:15:13
Without going through some forensic auditing process, there's no way for us to correct what I'm about to say. 00:15:15
The city existed long before this agency existed. 00:15:22
There are pension liabilities associated with city staff. 00:15:25
That are included in this number in some way, shape or form that were here before the agency. 00:15:29
They may be retired, they may be still on the books. It should correct itself as it goes forward, but I want us to be keenly aware 00:15:36
that the vote that's being asked today is for the Beach District. 00:15:41
To somehow be burdened. 00:15:46
With some of that stuff, and it may be it may be more, it may be less. I don't know what the answer to that question is without us 00:15:49
going through a forensic auditing process to figure it out, so. 00:15:53
I just want to make those statements and and would appreciate. 00:15:58
The support of the city as we move into this new phase of us. 00:16:02
Keeping that in mind and and bringing that forward to us so that we can feel confident in the future that we're we're trying to 00:16:07
that's the only solution that I can really come up with is that we make sure when we're booking the full time equivalents. 00:16:13
That we know whether the fully burdened rate carries any of this and if it doesn't. 00:16:19
Umm. 00:16:24
Then. 00:16:25
We we have the ability to look at that in the accounting and so. 00:16:26
I just want to make those statements with all due respect to the the city staff and to the members of the City Council here. 00:16:30
But I I would be remiss if I didn't make the statements on behalf of the the constituents I represented the beach district. 00:16:36
Thank you, Mr. Bouchard. Are there any other questions for staff? 00:16:44
Miss Lucero, could you bring up the slide that shows the? 00:16:50
The method of payment. 00:16:54
By each of the agencies of the allocation, yes. 00:16:57
So my question is for the city, the 53. 00:17:01
.95%. 00:17:05
Almost half $1,000,000. 00:17:06
Where would that money come from? 00:17:08
Did you say we're gonna true up? Do you think that would be for the cities portion that would be general fund. 00:17:11
OK. 00:17:17
You don't think that will be coming out of the reserves in any way or it would be a direct question? 00:17:21
The water, the Water fund. 00:17:26
The The Water Fund will be paying for that. The waterfront, OK. 00:17:30
Any other questions? 00:17:36
Yes. 00:17:38
The. 00:17:46
Activation. 00:17:53
Hmm. 00:18:50
Absolutely. 00:18:53
So with that said, how do you? 00:18:56
Does this board want to? 00:18:59
What do we want to request of staff in terms of follow up? 00:19:03
Would there be a report of some sort that? 00:19:09
We might expect down the road when you're ready to. 00:19:11
When you've done that analysis and or. 00:19:15
That forensic accounting, if yeah, if we're gonna do the three-year period that is being recommended then we can do. 00:19:17
We can do the math and and do the allocation of how much it's going to be per year. 00:19:26
And put something in writing. So we would want to have something in writing. 00:19:30
Umm. 00:19:34
With the term it would be a three-year term. 00:19:36
We, we were hoping to get this approved this fiscal year so that. 00:19:41
Everything going forward in the next fiscal year is is straight. We're happy to meet with Navy others. 00:19:45
You know, go through whatever detail folks want to have. We did meet with Mr. Bouchard. 00:19:50
Because he had some specific questions, I think that was useful and. 00:19:55
Was helpful and and he identified that and and. 00:19:58
Pretty clearly that we're happy to meet with others and go through the same process. I would like to sit down and have you go 00:20:02
through the numbers with me. So this is a very complicated something I don't look at every day, so. 00:20:07
Yes, absolutely. OK. 00:20:13
Director Cushman I just wanted to clarify, I I don't think the intent of my statement wasn't too task staff with a forensic audit 00:20:16
of knowing that 27 years and and trying to unravel what it would take to answer the question and the way that I would feel most 00:20:22
comfortable, I don't think that effort would be. 00:20:28
Money well spent on on behalf of us. 00:20:34
So. 00:20:37
Well, while I came here tonight thinking, gosh, I gotta vote my conscience and and can I I'm gonna, I'm gonna make a U-turn and 00:20:40
I'm gonna go ahead and support the staff recommendation tonight. 00:20:46
To move forward with maybe only the commitment that. 00:20:52
We receive a revised report of what the fully burdened staff rates are when the new time system and whatnot comes back, so that. 00:20:56
Members of other agencies can fully understand what that is. 00:21:05
So I'll I'll support staff recommendation with the request that city staff. 00:21:10
Look at what their new time allocation system and bring back that report of the fully burdened rate for employees and what's 00:21:15
included and not. 00:21:18
Thank you, Director. I think that's what I was intending not to go back, but to move forward with that information. 00:21:22
One, OK. 00:21:29
Yes. 00:21:30
So. 00:21:32
The information that you provided is from 2020. 00:21:33
So do not expect it to see any. 00:21:36
Thing like this for 2122? 00:21:41
So actually the number, the 932,000 is as of last year's audit because. 00:21:44
And every year they do the others, there's an adjustment, but the the number is not going to change significantly. So once it's 00:21:50
set, the liability set. 00:21:54
It it changes and it can change either way. 00:21:59
I'm in 2021 because their returns were so high. 00:22:03
It was actually a credit, so this is actually the number that needs to be. 00:22:06
Funded to fix that balance and then going forward it will be part of the financials. 00:22:10
Of PHW because there won't be a significant number. Great. Thank you. So I I just see 2020 on this sheet, but on this it does say 00:22:16
2022. So that's correct, 2022. Yeah. OK, great. Thank you. 00:22:21
I I think one way to to explain that is if you go back to your 2020 balance sheet. 00:22:28
That was up. 00:22:36
It was like 1.3 yeah, it shows a $1.14 million I think it is. 00:22:37
No money has been put into this as as as was stated. 00:22:43
And then in 2022 that number reduced and that's based strictly on the discount rate that Purrs applies to. 00:22:48
What your unfunded portion is, So if it does better or worse, this number will fluctuate on an annual basis. 00:22:54
But. 00:23:00
Yeah. 00:23:02
Yeah. So it's a combination of the the purse and then also the number of employees that are working. 00:23:02
At the plant because how staff distributes the liabilities based on payroll. 00:23:09
And so the people, employees changed dollars, changed the the dollar amounts going to change. 00:23:13
When you talk about race, you talk about how. 00:23:19
Staffs hourly rate and also staff allocations. 00:23:24
So people that move or position change positions so that payrolls never. 00:23:28
It it, it's always moving depending on. 00:23:33
Who's working at the plant? 00:23:36
Yeah. 00:23:38
OK. 00:23:41
If there are no more questions, I think we have a motion and did we get a second? 00:23:42
I'll second. Thank you. 00:23:47
All in favour. 00:23:52
Aye, all opposed. 00:23:53
Hearing none motion passes unanimously. 00:23:55
Thank you. 00:23:58
I look forward to sitting down and meeting with you also on this. 00:23:59
All right, let's move on to item 5, Strategic Planning Workshop. This will be one of two workshops. 00:24:03
I'm reading this correctly, staff, if you'd like to present the report. 00:24:09
Come on up. 00:24:13
Good afternoon. 00:24:32
In February, you guys approved through the strategic planning workshop. 00:24:35
So today we have perfectly two workshop. 00:24:40
Historical. 00:24:46
Trying to figure something out. 00:24:50
After years. 00:24:53
Mr. Ryan. 00:24:58
All right. Thank you. Members of the City Council and Board of Channel Islands, I appreciate the opportunity to be here. A little 00:25:05
bit of background on myself just to establish why I'm here today. 00:25:10
So I've been working in Ventura County for the last almost two decades. A lot of that has actually been in this sub region, so 00:25:16
served as a district Engineer for Channel Islands speech since 2015. 00:25:22
And then I've been doing the, I did the facilities master plan, a number of projects at that, your water treatment plant, the HW, 00:25:29
a water treatment plant and then a lot of planning documents just throughout the county so. 00:25:34
Understanding of the intricacies of all of the connected infrastructure, which you'll see here is. 00:25:39
There's quite a bit of. 00:25:45
So. 00:25:46
OK, so why are we here today? 00:25:50
This workshop is split up into two different sections. The 1st is going to be really focused on the background. I think it's 00:25:53
important given maybe the variable backgrounds amongst everyone here. 00:25:57
Some may not be as familiar, so we really want to build a common foundation to work from. 00:26:02
And ultimately, what's gonna come out of these two workshops? 00:26:06
Is essentially a work plan. What do we do next? And so hopefully we can come out of this building some consensus. 00:26:09
And have a concept or framework for which we can move forward together. 00:26:15
And so the way I'd like to proceed with this is I've got about 30 slides. I'll move through them at a fairly high level. 00:26:19
Stop me at anytime if you'd like me to dive deeper. You have questions. Chris is also here from MK, so we're gonna be capturing 00:26:24
any questions. 00:26:27
And we'll figure out how to get that information back to you, whether it's the next workshop. 00:26:31
Or in a separate follow. 00:26:34
OK, so first section is going to be establishing a baseline? 00:26:39
So. 00:26:42
How did all these water agencies operate prior to PHWA? 00:26:43
So what you can see here in the purple is all the member agencies of PHWA. 00:26:47
And what's in the sub bullets is basically a summary of what was happening in those agencies. So each of City of Port, Wanami, 00:26:51
Channel Islands, the Navy bases, all had their own local supply. 00:26:55
So that would be in the form of wells or connection to the United Water OH pipeline? 00:27:00
And what each of the agencies we're seeing independently was water quality issues, whether it be from seawater intrusion. 00:27:05
Iron and manganese, all types of water quality. 00:27:10
There was also the issue of seawater intrusion, which was impacting the reliability of that water source. 00:27:14
And what these agencies were doing is independently doing analysis, looking at. 00:27:19
Water treatment. Different water supply options. 00:27:23
And so it became clear that. 00:27:26
All the agencies independently were really facing the same challenges. 00:27:28
Which led to HWA. 00:27:32
So HWA was founded on some basic principles. 00:27:35
Basically that we wanted to create a higher water quality for this sub region. 00:27:37
There was a concern about the long term reliability due to seawater intrusion. 00:27:42
And also the opportunity to work together to have a cost effective solution. So obviously there's some economy of scale of having 00:27:46
a centralized treatment plant as opposed to everyone independently doing so. 00:27:51
So this is a simplified version of all the agencies involved in what it takes to get water to your member agencies. 00:27:59
So at the top, those logos are for United Water Conservation District. That's the and then of caucus, of course is spelled out 00:28:05
there. 00:28:07
So you have United coming in to the plant and that's where we go through the filters, that's the ROI and nanofiltration. 00:28:11
Cayugas comes in to provide water if, OH Pipeline United water is not available. It comes in during peaking. 00:28:17
Kaijus is a high quality imported water. 00:28:24
And United is your groundwater. It's lower quality. 00:28:27
And so the idea is you run that water through your plant and you create a higher quality water that's blended with a unfiltered 00:28:31
side stream and you deliver it to your member agencies. 00:28:35
Want to point out City of Oxnard, Their logo is on there. So how are they related to all this? Two different areas. The 1st is the 00:28:40
property itself that's owned by the city of Oxnard. It's a long term land lease the PWA has with Oxnard. 00:28:46
As well as the Oxnard conduits, the Oxnard conduit is the pipeline. 00:28:52
That's owned by the city of Oxnard that supplies the Cayugas Water Two Year Plan. 00:28:55
And so we've got two different ways that the city of Oxnard evolved. 00:28:59
You'll see the Cayugas logo shows up twice. You see them on the backside as well. 00:29:02
So the brine that comes out of the plant actually ties into their salinity management pipeline. 00:29:06
And so you've got a lot of different parties involved in in what what it takes to deliver water through your system. 00:29:10
So here's a summary of agreements that were developed so that. 00:29:20
PHWA could operate. 00:29:25
Not gonna go through each of these. What I'll point out is that. 00:29:26
Number one, there's a lot of agreements. 00:29:30
And so making modifications would take a lot of unwinding. 00:29:32
And then also that these. 00:29:36
You can see the correlation on when they terminate. It's all tied to the OH pipeline that's, I'm sorry, the OH agreement with 00:29:38
United, that's 2036. 00:29:42
So while you've been operating. 00:29:47
PHW for some time. You still have 13 years left on the existing agreement. 00:29:50
Agreements. 00:29:57
I'll walk through a couple of those agreements and just some. 00:30:00
Helpful highlights from those agreements. So you've got the JPA agreement. 00:30:05
There is an operational audit that's required to be performed every five years. The last one was performed in 2015. I'll dive a 00:30:08
little deeper on that in a future slide. 00:30:12
You also have capital costs. So capital costs, OEM costs, basically the operating costs and how that's appropriated to the 00:30:17
different agencies is all defined in those agreements. 00:30:22
Which I'll I'll show in another slide here. 00:30:27
You've got the water sales agreement, so each of the agencies has a water sales agreement. 00:30:29
It should be pointed out that some of those agreements actually highlight minimum and maximum flows. 00:30:33
So there was an intended operation of the plant in those agreements. 00:30:38
How well that's followed today. 00:30:42
Maybe has modified a bit? 00:30:45
And here in the last one is your connection to the selenium management pipeline. I do want to point out that there's a value to 00:30:47
this. It's a little difficult to quantify, but I can tell you most brackish water facilities don't discharge their brine for free. 00:30:51
You do. 00:30:55
So that's really an asset that was negotiated. 00:31:00
As part of Cayugas bringing their salinity management pipeline through the City of Port Mini. So there's a value there that that 00:31:02
should be recognized. 00:31:06
Another interesting item, the Imported water service agreement. That's with Cayugas. 00:31:12
Cayugas, when this project was developed, actually put some money in on the capital side, which offset some of the costs from the 00:31:16
member agencies. 00:31:20
And as part of that agreement, they actually have access or the ability to use excess capacity in the plant. 00:31:23
Now, while they don't do that. 00:31:28
I think it's an interesting opportunity to look as we look forward, are there ways that we can continue to partner with colleagues 00:31:30
to offset costs and create more economy of scale? 00:31:34
So it's just an interesting piece that's already was really built into the original concept. 00:31:38
The OH pipeline. This is another item. 00:31:43
You have a take or pay for that for that water supply agreement for the H pipeline. 00:31:46
And this is maybe something that isn't paid attention to very much, but it's certainly an incentive to use all your united water 00:31:50
as you as you pay, even though you don't use it. 00:31:54
And then finally, the third party agreement. 00:32:00
On here. 00:32:01
As you well know, that agreement has some language related to the transfer of of credits. 00:32:03
And so this is just pointing out that there's still some unresolved issues in some of these older agreements that. 00:32:08
That need to be updated. 00:32:13
So I mentioned the cost allocations. You can see on this table you've got the member agencies. 00:32:17
You've got capital fixed. 00:32:21
Fixed O&M in variable and what I wanted to point out here is. 00:32:24
These numbers were established as part of the original JPA. 00:32:27
And what I'd highlight is on the variable costs. So the variable costs reflect more with how water is actually being used today. 00:32:31
Whereas the fixed. 00:32:37
United and fixed O&M, those are numbers that were established based on. 00:32:38
The original. 00:32:43
Capacity what each agency thought they were gonna need. 00:32:45
And so I would just point out that those don't. 00:32:48
Align perfectly, but they're actually fairly consistent with each other. 00:32:50
So what is the infrastructure look at? 00:32:56
You've got the water treatment plant. It's a laser. 00:32:58
You guys are looking at different screens. 00:33:01
Water treatment plant that's right in the center with the blue star that's that's the plant. 00:33:04
You can see the pipelines, those are the different colored lines running out of there delivering the water from the water 00:33:08
treatment plant to the member agencies. 00:33:11
What I wanted to point on this slide is is 2 things. 00:33:14
1st is that because? 00:33:17
Of where the turnouts are for the member agencies, the ownership of those pipelines actually varies. 00:33:19
With you can see on the right with that yellow line. 00:33:25
Maybe base point Magoo is the only one essentially taking water off that. 00:33:28
Except for those two small turnouts from. 00:33:32
Those crawlers but. 00:33:35
It's mostly owned by them. 00:33:36
And so that needs to be taken into account when looking at. 00:33:37
Or should be taken into account when looking at and maintenance of those pipelines. 00:33:40
It's not exactly clear in the agreements. 00:33:44
That we've seen that, that's. 00:33:46
That's spelled out that way. So that would be an item that could be looked at. 00:33:48
And then as far as the Magoo lateral? 00:33:52
The ownership of that from the, from the documents we saw, it appeared that that used to be part of the OH pipeline at some point. 00:33:54
Was transferred when it became a sole EPHWA facility. 00:34:00
The language that. 00:34:04
Spells that out was not clear in the agreements that we had and so that would be another item that. 00:34:05
Given the age of that pipeline, should be. 00:34:10
Further looked at. 00:34:13
That's Jared. 00:34:15
I could see you had a question. 00:34:19
That pipeline, I believe is leased. 00:34:21
I think it's still under United ownership as part of the OH system and I think it's somewhere tied to the other agreements in this 00:34:23
that pipelines under under lease obligation and I think it's zero charge. 00:34:29
Much like our CMDD is. 00:34:36
United Water. 00:34:38
Lease that they reserved for us. 00:34:40
Which one are you talking about? It's the Purple Pipeline. Yeah, Purple Annual. 00:34:42
Yeah. 00:34:47
Excuse me, the yellow one from yellow. 00:34:49
And what do you mean by charged that it's? 00:34:51
It's the orange the OH system prior to the PHWA facility used to deliver water out to these facilities directly and when PHW was 00:34:55
built. 00:35:00
There was existing infrastructure. 00:35:05
And so some of these pipelines in order to have to build a whole bunch of other stuff. 00:35:08
Were leased or given over to make the project successful. 00:35:13
By united as part of. 00:35:17
So. 00:35:20
Don't believe that the HW actually owns those facilities. I believe they're so, but I don't know about operation and maintenance 00:35:21
and so that would be an item to look at just given the age of that pipeline. 00:35:26
So that would be and you'll notice as we go through this presentation identifying a few items that could require or should be 00:35:32
looked at further or needs to be resolved. 00:35:36
And then I summarized these at the end. Great. 00:35:41
As these will feed into what could be the work plan. 00:35:43
So this is water. Use that those stacked color. 00:35:49
Bars are water use divided or. 00:35:54
The different colors represent the different ages. You could probably see it better on your screen. 00:35:57
Wanted to point out a couple of items. This goes back to 1718 that fiscal year. 00:36:01
Is first is that it's it's fairly stable. So when you look at the water demand. 00:36:05
Over the last few years, we haven't seen a lot of increase or decrease one way or the other. 00:36:10
And the other item I would point out is that if you go back, I just referenced 2015 urban water management, but you could go back 00:36:15
to 2010 and even further. 00:36:19
The projections of what the anticipated water demand was going to be. 00:36:23
Historically when you start stacking these up. 00:36:27
They haven't met it. 00:36:29
So we've just seen. 00:36:30
Water conservation continued to increase. 00:36:32
The. 00:36:35
Development not occur but we haven't seen. 00:36:36
What I would characterize the projections at is, is very conservative. 00:36:39
And I say that because when we look at the water supply projections and we do the modeling. 00:36:43
We should take that into account. 00:36:48
That. 00:36:50
These. 00:36:50
These projections which create. 00:36:52
Overages on our allocations. 00:36:54
May not be entirely accurate. 00:36:57
So. 00:36:59
And then the same goes for Channel Islands, the the projections have never. 00:37:01
Really met the. 00:37:05
The actuals. 00:37:06
So this goes back to 2009. This is fixed and variable costs for PHWA. 00:37:09
And you've got the lighter purples the fix, the darker purples the variable. 00:37:16
And wanted to point out a couple of items on this. 00:37:21
So the first is that the last few years, if you just go back to 2018-2019, you see this steady increase. 00:37:23
And. 00:37:31
Now there's. 00:37:31
There's more to explore there. There's certainly some reasons that you could account for some of that increase. 00:37:33
But certainly that's been a lot of increase the last few years. You also see a lot of variability in the fixed costs. 00:37:38
And so that that creates some questions. 00:37:44
And then the final two are. 00:37:47
Or I referred to earlier on the United is that you have this take or pay impacts that as we started to look through the budgeting. 00:37:49
This is an item that. 00:37:55
When we've worked with other districts before, it's certainly an area to focus in on because it's kind of you kind of hit, get hit 00:37:57
twice. 00:37:59
So if you don't use all your groundwater. 00:38:03
You pay a penalty. 00:38:06
But you're also replacing that water with potentially imported water. 00:38:08
And so you really want to maximize, you really want to maximize how much groundwater that number should be 0. 00:38:11
And a lot of agencies are tracking that on a monthly basis, looking at their demands and how they're running their facilities to 00:38:17
try to get that as close to 0 as possible. 00:38:20
Did did you guys look at how the and and I know you guys staff answered this question for me a little bit ago or a few meetings 00:38:29
back regarding? 00:38:34
How United was? 00:38:38
Addressing the allocation issue under the OH agreement, water year versus calendar year and and how they would look at that. 00:38:41
These numbers under the take or pay, are they impacted based on the new allocation regime at the GMA? I guess just a furtherance 00:38:49
question maybe that we look at to. 00:38:54
Yeah, in the context of what you're talking about, because if you've got a higher take or pay number than what? 00:39:00
The sub allocation of PHWA is from the GMA. 00:39:06
I don't know which one Trump's which, yeah. 00:39:10
Alright. 00:39:13
We're going to go to that. We'll look at that. 00:39:13
The last one is the spreadsheets. 00:39:15
We use the word optimize. They could really be cleaned up. 00:39:18
Made a little bit more transparent. 00:39:22
That was something that we found going through there. It was a little difficult the the formatting sort of changed year to year 00:39:24
and. 00:39:26
And so I think that would be another area I would add to the work plan really to clean that up. 00:39:29
Water quality. We put this slide together. 00:39:37
To sort of set the table. 00:39:40
On this question about. 00:39:42
Blending and and water quality and. 00:39:44
So to kind of explain this graph, you've got, First off, the data came from the Consumer Confidence Reports. That's a. 00:39:47
State requirement for. 00:39:53
Water quality that you serve to your customers. And so we pulled that information together and we looked at. 00:39:55
A few different constituents. 00:40:01
Related to water quality, so we look at total dissolved solids. 00:40:02
Specific conductance. 00:40:05
Total hardness and fluoride. 00:40:07
So fluoride is the blue line. That's what we see there. 00:40:08
And then the. 00:40:11
The bar charts are the the other three. 00:40:12
And So what I would point out is that you've got caucus, that's your imported water that's on the far right. You see though, it's 00:40:15
having the lowest bars. 00:40:18
Is really the highest water quality? 00:40:21
And there's HWA right next to it. 00:40:23
So you really do deliver high quality water? 00:40:25
What you have on the other end is Ventura and and I will. 00:40:29
I'll caveat this and say Ventura has various water sources. 00:40:32
So I don't mean to. 00:40:35
Disparage. 00:40:37
Don't mean to disparage them. 00:40:38
One of the and the way that these reports work is they list the quality of all their water sources. The East End as I remember is 00:40:40
is got some water quality issues and that's what that water quality represents. So you have very high TDs. 00:40:45
You have very hard water. 00:40:52
And so that's sort of. 00:40:54
That end of the spectrum, you can see United, which is your groundwater. 00:40:56
That's not too far off that. 00:41:00
And you can see Oxnard right in between PHWA and and. 00:41:01
And United. And that makes sense because it's basically a 5050 blend of the two. 00:41:05
And so that's where you can see we took that created a 5050 blend. You can see it's very similar to what OX starts delivering. 00:41:09
So HW has a higher water quality close to imported water. 00:41:15
OK, starts further down and Ventura is even further than that. 00:41:19
So just to kind of put into context where your water quality might land if you start blending. 00:41:21
At a 7525 you can see that between United and Oxnard. 00:41:26
Your TDP starts getting pretty close to that secondary limit of 1000, which. 00:41:30
You can do. 00:41:35
It's just the water quality starts getting fairly degraded. 00:41:36
What is TDs again? Total Dissolved Solid. 00:41:39
You want it low. 00:41:45
Can I ask what what year was this data taken from? Is this an average over time or so? It depends on the agency. Somewhere. Better 00:41:46
reporting online than others, so somewhere, and I won't say which ones were. 00:41:52
There was some 2022 data. 00:41:58
I think we even had 2021, so we grabbed whatever was most recent off the website. So it was not an average, it was the most recent 00:42:01
year. 00:42:05
OK. And can can I ask and Dennis, if you got to get back to me? 00:42:09
I know one of the foundational principles as you laid out originally was that the PHWA operation would. 00:42:13
The treatment plant would look to target that quality of CWD water deliveries or State Water Project water and that's generally 00:42:20
around 330 parts per million TDs, right? 00:42:26
And we're what we're seeing here is. 00:42:32
Not necessarily hitting that target. 00:42:34
I don't know. That's why I was asking what year this was from, if there was, if it was one of those years when the plant was down. 00:42:36
If there was some reason, just just for reference. 00:42:42
Right, I think possibly the TDs number possibly could have climbed due to the bypass. 00:42:45
So I don't know when those numbers you're referencing. 00:42:52
Originally the numbers are trying to hit. 00:42:55
I don't know if they took into account the bypass flow that comes through. 00:42:58
United Water. 00:43:01
Which is constantly flowing and mixing with our treated water. 00:43:02
That's coming out of the trains. 00:43:05
Would it, would it be fair? I I mean excite. I think where you're going here is we need to have this conversation about what is. 00:43:11
The water quality that we all want to continue to deliver to our constituents and it changes kind of that strategy. 00:43:18
Is it? Is it fair for me to ask the question is this really representative of baseline water quality? 00:43:27
That PWA has been putting out over the last year and I asked that question because have we heard a whole lot of complaints about 00:43:33
it if it's out? 00:43:36
450, not 330. 00:43:40
And I guess maybe I. 00:43:42
I'll leave that question there and I think you guys will know where to go with it if we need to look at that a little closer. 00:43:44
I would say. 00:43:50
Certainly more we can follow up on the consumer confidence reports are not. 00:43:52
As an average of the annual water quality discharge to customers, they literally take the water sources and I'm sure staff can 00:43:56
expand on that there. It's a pretty basic document. 00:44:00
And so it might just be an average of those. 00:44:05
Based on the water uses. 00:44:07
But I'd say it's it's a fair representation. 00:44:09
But you bring up a point that sort of came through this exercise is that. 00:44:12
While the water quality objective was stated as part of the formation of the JPA, there isn't a policy in place that says we will 00:44:16
serve this. 00:44:19
Or we will serve that and I. 00:44:23
Believe that should be something that. 00:44:25
Should be established. 00:44:27
Just to create clarity of objective and operation for the staff but also. 00:44:28
To have a policy in place that. 00:44:33
As. 00:44:35
Elected's change over time that this is put in place and this. 00:44:36
That comment is fairly. 00:44:39
Common throughout a lot of the findings we've come across so far is just creating processes that outlive. 00:44:41
Either staff or elected officials, because those will change over time and the mission starts to get lost. 00:44:49
As new staff come in. 00:44:56
And we end up. 00:44:58
Here we are today, going through. 00:44:59
What the objectives and background of PHW are? 00:45:00
I think this is a good step forward though. 00:45:04
This slide highlights major capital investments. 00:45:07
So not too many recent but really wanted to include this slide to point out that. 00:45:10
There was a a major capital outlay and there is still value to those assets. 00:45:16
Some of them obviously need to be rehabilitated and some are reaching the end of their useful life. 00:45:21
But there is a value to that and to that should be considered if there was. 00:45:26
And if there was a scenario to walk away from that, this should really be considered. 00:45:32
OK, I wanna go through a few previous planning efforts, put a summary of the ones I'm gonna highlight here. I'll go through this. 00:45:38
Pretty quickly. 00:45:43
The operational audit and then some of the strategic plan that actually occurred several years ago. 00:45:44
All right. The 2015 operational, this is a good document. We reviewed it. 00:45:50
There's some good findings. I would say that there could be a lot more looking at how the plant is actually operating. Is it 00:45:54
efficient? 00:45:57
The major flaws to this were. 00:46:01
One, we're not doing it every five years. 00:46:03
The second would be there's no accountability, so once that document gets completed. 00:46:06
I'm not sure how many people on the board here were here back in 2015, but that information should be relayed back to the member 00:46:10
agencies. 00:46:14
And there should be a work plan in place for those items that. 00:46:17
The board and elected officials collectively agree need to be addressed. 00:46:20
And I I believe that's a failure and that goes to. 00:46:24
Sort of what we spoke about before about having those processes in place. So this was another one I would put in that category. 00:46:26
It's a it's a good document. 00:46:29
Alright, I want to talk about some strategic planning that happened a few years ago. So Channel Islands Jared will remember this 00:46:34
in 2017. 00:46:38
Did a fairly high level effort looking at water supply options. Really looking at. 00:46:42
What's out there as far as opportunities both with PHWA and outside of PHWA and when the board at that time? 00:46:47
Did conducted the survey that was done. 00:46:53
The top three. 00:46:56
Really priorities for that board are are listed there in bold and I'll point out the water quality because you'll see that aligns 00:46:57
with. 00:47:01
With city Port Winema similar effort. 00:47:05
And so there was really an interest in maintaining a higher water, water quality there was some acceptance of. 00:47:07
Of maybe taking on some risk but really wanted to be a leader in getting. 00:47:13
Getting some work done in securing that water supply. 00:47:16
So that following year in 2018, City of Port Mini conducted a similar effort. 00:47:20
And looked at their council at the time and came up with these top three items. 00:47:25
And there you see water quality in the top three. 00:47:30
So there was agreement between. 00:47:32
The, you know kind of two major partners of PHWA that. 00:47:34
Water quality was important. 00:47:38
There was some similar interests and reliability and costs, but that water quality was important and there was there was an 00:47:40
agreement that. 00:47:43
Let's let's make PHWA. 00:47:46
Work. They wanted to. They wanted to make HW work. 00:47:48
Which really led to, in 2019, the facilities master plan. 00:47:51
Because if we're going to make, if we're gonna make pH away work, what's that gonna cost? What's? 00:47:55
What needs to be done? And so this master plan looked at a condition assessment. It looked at building a water supply model and. 00:48:00
What it What is our? 00:48:07
Are we gonna have enough water to run and then developing a CIP? 00:48:09
Here's the IP. So this was done back in 2019. You got 48 projects $2.4 million. 00:48:14
These projects were not. 00:48:19
Intended to. 00:48:21
Create a hundred year life. These were really focused on what do we need to keep this plant. 00:48:23
Adequately running. So no gold plating, just. 00:48:28
Minimum items to to really keep it running. 00:48:31
So since 2019, of those 48 projects, when we looked at the CIP completed projects, we counted 8 for a total of $72,000 so far 00:48:34
below what the anticipated or what the goal really laid out was. 00:48:41
One item I would note is. 00:48:48
Looking back at the 2019 Master plan, there was no SCADA upgrades on there. That was because that project at the time was 00:48:50
underway. 00:48:53
And so that was back in 2019 and that that project still being. 00:48:57
Completed now. 00:49:01
So there's been some challenges on the implementation side. 00:49:02
But these projects, they were spent a lot of time. 00:49:06
This was done in collaboration with staff. This was sort of an agreed to provide work plan. We we heard actually Don in public 00:49:10
comment talk about the tank project. 00:49:14
Take assessment was year one, take rehab was take was year two. So that was all budgeted. It was planned. 00:49:17
We just on the execution didn't get there. 00:49:23
And I want to highlight a couple of the projects on there because these. 00:49:26
There was project down there that actually reduce cost. 00:49:29
We talked about I I brought up the. 00:49:33
Fluoride levels. 00:49:35
You you know, the fluoride system could potentially be removed. 00:49:37
You have natural occurring fluoride. 00:49:40
So that could be evaluated. There's a cost savings there. 00:49:42
United Direct connection, we heard. 00:49:45
From Don that projects on here. 00:49:47
That could potentially reduce pumping costs. Third stage RO. 00:49:49
That'd be a great project for grant opportunities. 00:49:53
There's actually already a preliminary design done for that. It was done back in that might have been 2019 or so as well. 00:49:56
Low flow pumping. This would help us to use all our united water. 00:50:03
Right now, when you get to certain low level demands, you actually have to use imported water if you had. 00:50:07
A lower flow pump, you wouldn't have to. 00:50:13
Reduces your need to use imported water and make sure you maximize your groundwater. 00:50:16
Hydraulic analysis. This was looking at your discharge pressures. There's some opportunities for energy costs, so I point all that 00:50:21
out and that these costs were. 00:50:24
Investments that could actually reduce your operating costs and help you to better utilize your groundwater. 00:50:29
Ohh, did you have comments, excuse me, on the seismic analysis? Did you mention that yet? 00:50:34
Ohh sorry. 00:50:40
The last slide, yeah, so that I didn't, I just brushed over that because. 00:50:41
We've heard about it earlier from from Don. So this project was on there. OK, I think it's, it's, it sounds like the seismic 00:50:45
analysis was completed that was probably one of the eight projects that that were conducted. 00:50:50
And the recommendations were made. I think there's some. 00:50:55
We've talked about it with staff a little bit. There's some interesting concepts, Con. 00:50:58
Steps on how that tank could maybe be repurposed. 00:51:02
That we've brought up with staff and we could explore more, but it's a project that. 00:51:05
Was planned for. 00:51:11
And was considered. 00:51:13
But it should be done. 00:51:15
Within how the master plan laid out because. 00:51:18
These projects all have impacts on each other. 00:51:21
And if you're just picking off the projects you want, there was a reason these projects were laid out in the order that they were. 00:51:23
We wanted to evaluate the bag filter before we replace the oral membrane so that you don't put new oral membranes are. 00:51:28
Or oral membranes in and then damage your membranes. 00:51:34
So everything was done in a sequential order on purpose and same with the size of it. 00:51:36
Thank you. 00:51:42
Water supply planning. So a spreadsheet model was developed to look at water supply water supply planning. 00:51:44
And really, what it pulled in is your demands. 00:51:49
Current and anticipated. 00:51:53
That looked at water supply. 00:51:54
How much groundwater do you have? How much imported water it put cost to each of those it took into account? Different tiers? 00:51:56
And we looked at different scenarios, so we looked at a baseline. 00:52:02
We looked at whether water increases. What happens, Water demand decreases. What happens. 00:52:05
And then we looked at a baseline where we made a capital investment. 00:52:09
Such as third stage RO. 00:52:12
So this. 00:52:16
Spreadsheet which is probably easier to see on your screen. I'm gonna just explain this. This is basically. 00:52:17
The dashboard for the water supply model. 00:52:22
And so up top you have all these ability, you have all these essentially toggles where you can adjust. 00:52:25
Different assumptions. So you have what is your water quality goal. 00:52:30
Because obviously if you make your water quality go higher. 00:52:33
Your costs go down. 00:52:36
When your brain goes down. 00:52:37
You've got a recovery rate. Recovery rate is how much water are we sending to the brine? 00:52:39
So there's investments that could be made to improve that and then you have a final dollar amount, that dollar amount there on the 00:52:43
top right, 105 million, that's basically. 00:52:47
What all the water supply costs are for the planning period which is 20 years? 00:52:51
And then these different tables. Here graphs show the makeup of how the water is used. 00:52:56
The one I would highlight is right there in the middle which. 00:53:01
Is the. 00:53:05
Groundwater demand allocation. 00:53:06
So. 00:53:08
We heard how demand goes up, water allocation goes down and you start to. 00:53:09
Because I hit a deficit here in these future years. 00:53:14
And so what's great about this model is you make these adjustments and you see what happens with your water supply portfolio. So 00:53:18
I'll point out the 105 million on here. This is the baseline. 00:53:22
Now this was all done in 2019. 00:53:26
So these were based on those assumptions then? 00:53:28
So then we looked at what happens if demand goes up. 00:53:31
By 10%, you can see now we're at 125 million, so we went up about 20%. 00:53:34
And now we're We're hitting a deficit. 00:53:40
Earlier in our planning cycle. 00:53:42
Now if we go down, you see the costs, We go down 10%. Now our costs are down to. 00:53:46
I believe it's 95 million. 00:53:51
And we push our deficit out into a future year. 00:53:53
So it goes out about another five years. 00:53:56
So demand obviously has an impact. 00:53:58
On our cost and our allocation. 00:54:00
This one I think is. 00:54:03
What's really interesting? So on this, we look at the baseline, but we make, we make an adjustment. We add in $1,000,000 up front. 00:54:05
And we bump up our recovery from 80 to 85%. 00:54:12
And the costs, even though we spent that extra capital up front, it's actually basically the same as our baseline. 00:54:16
And we push out our deficit five years. 00:54:22
So this water supply planning tool was intended to. 00:54:25
Give the board the confidence that we can make these investments and actually have a more reliable source of water. 00:54:29
At roughly the same cost over the planning period. 00:54:35
So what comes next? 00:54:40
As part of our next workshop, we're going to be updating this water supply tool. 00:54:42
With the current number, so we have new cost of water. 00:54:47
We now have a better. 00:54:50
Understanding of what the allocation is. 00:54:52
And we're going to look at some new scenarios. So we'll look at a scenario where. 00:54:55
Let's modify the water quality a little bit. What happens if we? 00:54:59
Get a little closer to a 5050. 00:55:02
We'll look at plant optimization. 00:55:04
That's helping with that low flow pumping. 00:55:06
That's the 85% recovery. 00:55:09
And then let's look at. 00:55:12
A stable demand. 00:55:13
With our current demand numbers. 00:55:15
What happens if we don't get the? 00:55:16
Future demands that were outlined in the Urban Water Management Plan. 00:55:19
So this will give us some more information. 00:55:22
Coming back to inform us I'm almost done. 00:55:25
Sorry, it's a lot of information. 00:55:28
All right. 00:55:31
So as we went through. 00:55:32
This presentation. 00:55:34
We started to highlight items that. 00:55:36
Should really be included as part of a kind of a next steps after you know what what happens after the strategic plan well. 00:55:38
We've identified these critical areas that need to be. 00:55:43
Basically resolved. 00:55:47
And we can optimize or improve the operation of PWA. And so we started to put these into buckets. 00:55:48
So you've got a legal institutional. 00:55:53
So first item you know doing the conducting your five year operational audit and creating the process around that. 00:55:55
Starting monthly Operation reports. 00:56:01
That make it easier to do those. 00:56:03
Five year assessments. You'll have all the data and each. 00:56:05
Board meeting you start to get. 00:56:08
More cost information about how the facilities actually operating, how are we performing to the metrics we've established. 00:56:10
Actually establishing metrics. 00:56:15
What is our expectation as far as delivering on our CIP? What is our expectation on water quality? 00:56:17
Did we meet our objective? 00:56:22
Did we deliver on these IP's? 00:56:24
The land lease, The third party agreement. These are items that need to get resolved. 00:56:26
They've been sort of languishing for a while. 00:56:29
So putting a focused effort to getting those done. 00:56:32
And the financial bucket, let's look at projects that can reduce our cost of water. Let's maximize our let's make sure we're not. 00:56:35
Using that take or pay that we're actually using all our groundwater. Let's look at grant opportunities. There are a lot of grant 00:56:41
opportunities right now. 00:56:45
We just I I know Jared you got you did pretty well with Pleasant Valley and getting some grants. 00:56:49
There's a lot of earmarks going on right now. 00:56:53
So that could be an opportunity. 00:56:56
And then creating some forms and procedures. 00:56:57
What really needs to come out of this process? 00:56:59
Is that there's been sort of fits and starts with. 00:57:02
OK, let's do this. And then you have chart turnover. Let's do this. Then you have turnover. 00:57:05
You really need to create a work plan that lays out these objectives, to create the the policies and procedures so that when this 00:57:09
board is gone, this council is gone, this staff is gone. 00:57:13
That this can continue over sustained period because nothing really happens over one or two years. 00:57:19
You're gonna really need several years to work through agreements. 00:57:24
To get these projects done and so you need a framework. 00:57:27
That can allow that to be successful over that sustained period of time. 00:57:30
And then the finally was the asset management. 00:57:33
Actually getting a CIP, staying with the CIP and following that CIP. 00:57:36
Having the funding in place so that the member agencies knows what money is coming and that those are funded. 00:57:40
Executing projects and then creating an inventory, we saw you know the good pipeline, some of these assets. 00:57:45
How well they're being tracked? How well is the asset management on those? 00:57:50
Are these going to be, you know, are they funded for when they reach their useful life? Are there things we can do now to extend 00:57:54
them further? 00:57:57
So having a better understanding. 00:58:01
Of of some of the the pipeline infrastructure we've got a good handle of the water treatment plant. 00:58:02
Through the master plan. 00:58:07
Expanding that to the pipelines. 00:58:08
So this is the start of that. 00:58:11
Framework. 00:58:13
It'll get, it'll get further established and then in the next workshop, but this is sort of a starting point. 00:58:15
And So what is that second workshop? This is the last slide. 00:58:21
Is we'll come back. 00:58:24
We'll take any feedback we hear today. 00:58:25
We'll come back with the updated water supply modeling. So we'll walk you through what we're seeing if we kind of adjust these 00:58:28
different metrics. 00:58:31
We're gonna look at some opportunities that have been brought up about a blending station. There's other regional opportunities. 00:58:35
What are those out there? What are? 00:58:38
Opportunities to get involved that could. 00:58:41
Reduce your costs. 00:58:44
Or create more reliability. 00:58:45
And then finally wrapping it up with finding and recommendation and really laying out. 00:58:47
That work plan kind of the next steps. 00:58:50
So that. 00:58:52
This process doesn't end with. 00:58:53
The second workshop. 00:58:56
But actually could move forward. So hopefully being able to lay that out to the board so you have something that you can. 00:58:57
Actually push forward. 00:59:02
That is my last slide. Very good. 00:59:06
It's a lot of information, a lot of information, a lot of work to be done, but you know, planning for the future so important and 00:59:08
it's it's like succession planning we have to. 00:59:13
Plan for when we're not here? Yeah, staff not here, so. 00:59:17
Yeah. 00:59:21
Fully support that. 00:59:22
Are there any questions? 00:59:23
Comments. 00:59:27
Yes, I think you guys did a a Yeomans job of of pulling together what what, what the board or what you guys what needs to be 00:59:30
evaluated for us to have a comprehensive. 00:59:36
Umm. 00:59:42
Plan and I see one of your questions is bringing back water supply modeling. 00:59:44
And I appreciate the models that were included in here. 00:59:50
Umm. 00:59:54
From my perspective, I think, I think our objectives are different than the financial piece that that that to me is so. 00:59:55
Such an unknown for us, but it is. 01:00:02
The commitment to the facility there is the commitment to making the improvements there. 01:00:05
Even the ramp down and the credit and where where you're running out of groundwater. 01:00:12
Those things are so up in the air and why do I say that as you've got some really expensive projects being planned for the region 01:00:17
today that? 01:00:21
Are gonna affect the cost of that groundwater going to affect the cost of the, OH, water that's delivered to us. 01:00:25
Um, may affect our. 01:00:31
May affect. 01:00:33
How we use? 01:00:34
Groundwater, right. One of those things that's been sitting out there people talking about is. 01:00:36
The rest of the region paying for. 01:00:41
People that have access to state water supplies to use a replenishment, B to encourage them to use it when it's available. 01:00:44
So. 01:00:53
I think the fundamental question for us is are we committed for the next 13 years to the plant operating at what? 01:00:54
Level what? What water quality objectives do we want to ask staff to? 01:01:01
Bring back a nose. 01:01:08
At least that's where I'm kind of sitting right now trying to absorb everything that's here today in in front of us is. 01:01:11
How the interplay of those things? How do we provide some meaningful direction in this process? 01:01:19
And and those are a couple of the key questions that I would have or or? 01:01:25
But I think that we need the answer for you all to to kind of move ahead. 01:01:29
Alright, I have an A question regarding the Oxnard pipeline. 01:01:43
Umm. 01:01:49
In light of the agreements that need. 01:01:50
To be reviewed and updated is Will that be one of them? 01:01:52
The OX. 01:01:56
The Oxnard, Yes, that's the three. 01:01:57
Party agreement and that includes the. 01:01:59
Transfer of allocation that. 01:02:02
Sort of. As groundwater use has changed, is sort of obsolete, so that's something that will need to be. 01:02:05
Resolved. 01:02:13
And that would that would be an item on the work plan. 01:02:14
So this is your summary here that you finished with. 01:02:19
The three buckets, the legal, institutional, financial and asset management, yeah, and sort of where this is going at the next 01:02:23
workshop, we'll go through those. 01:02:27
Other opportunities, the regional partnerships that are out there. 01:02:32
And that those buckets would expand. 01:02:36
But ultimately developing. 01:02:39
The next step that would potentially come out is you have what is, you know, bullets on a in these buckets, but basically turning 01:02:42
that into an actual work plan because. 01:02:47
I think where you've had challenges in the past. 01:02:53
Is those bullets? Some of those are legal, some of those are staff. 01:02:55
Some of those are. 01:03:00
All the agencies and HW way working together. Some of those are consultants, some of those are contractors. So there's a lot of 01:03:02
different pieces and I. 01:03:06
What? You what? 01:03:10
Would be helpful to ensure that it actually all gets done. 01:03:11
Is you. 01:03:15
Create a work plan that uses this as the starting point. 01:03:15
And then lays out a schedule. 01:03:19
People responsible reporting schedule meaning. 01:03:21
What's the frequency that maybe this group of people that represent all these different elements that need to get this done, get 01:03:24
together and start to execute on that plan and report back to this? 01:03:29
This group. 01:03:34
On what the progress is. 01:03:35
And so that you can be involved through the through the whole process but. 01:03:37
Without that framework. 01:03:41
Trying to get it all done. 01:03:43
It's. 01:03:45
I can't see another way. 01:03:46
It was a long answer to your question. Yeah, do it without without a framework. 01:03:50
Umm. 01:03:54
OK. 01:03:55
Any other comments or questions for Mr. Gallagher? Yes. 01:03:56
Thank you for the presentation. The one question that I have is regarding the JPA's. 01:04:01
You mentioned earlier that. 01:04:07
There was a requirement for a five year audit. Hmm and that that had that was done last in 2015, right. So that's eight years ago. 01:04:11
So is there any issue with that the audit not being done? 01:04:20
Well, it's it's in the agreement. If the member agencies don't want to do it, that's your purview, but. 01:04:25
I I believe that the operational audit is a good way. 01:04:31
To keep. 01:04:34
The organization accountable and that. 01:04:36
The process is good and it should be updated. 01:04:39
I would recommend just. 01:04:42
Modifying it a bit so that it looks more at. 01:04:45
The actual operation, so taking some of the data, are we hitting our water quality? Are we efficiently operating the plant? 01:04:48
The recommendations in there related to. 01:04:53
How it was operated? There was some asset management pieces. It was a good, it had good findings. It was, it could just be. 01:04:56
The scope could be more clearly defined so that each five years we can start to see how are we improving. 01:05:02
But also how it's reported back to this group. 01:05:08
It needs to be more transparent. This is the findings. 01:05:11
This is how we're going to address it. This is the timeline. We're going to address it so that the funding is there. There's a 01:05:14
commitment to get it done assuming that there's agreement that it should be. 01:05:18
But that would be one piece and while it's not in the JPA. 01:05:22
Monthly reporting with more standard. 01:05:28
Data that gets to. 01:05:31
The operation, in both its costs and efficiency, I think could be another standard and process that could be established. 01:05:34
And you could do those at the same time. The operational audit could help to develop that. 01:05:41
And then that tool then becomes something that's used by by staff going forward. 01:05:44
And if I could just add real quick, just to be very clear, the annual financial audits have been completed. 01:05:49
So this is the operational and this is how we're actually operating the plant and then if I also could add. 01:05:54
You notice we put the operations report on consent this month. It's because we had noticed that it was getting. 01:06:00
Pretty drab and and. 01:06:05
Wasn't giving you with the information we think is required. So that is as Mr. Martinez has come on board as he's been taking a 01:06:07
fresh look at all these things. 01:06:11
And he's very interested in making sure that those are useful, that they are delivered monthly and again he picked up and and you 01:06:15
know right away. So hey, we we haven't done this operation a lot. We need to get back on that. All of that has been waiting a 01:06:19
little bit. 01:06:23
And kind of this effort. 01:06:27
To kind of reboot and get all these things started. 01:06:29
Excellent. Thank you. 01:06:32
I like the plan. 01:06:34
Yes, I feel like maybe we're. 01:06:35
They've come to us and and ask for some direction on some of the alternatives that are here and maybe we should should provide 01:06:40
that and and so maybe I'll take a stab at. 01:06:44
Where I feel we're at so they feel comfortable moving forward because I hate to have to go through this next effort and come back 01:06:49
and then we start throwing it all out and saying. 01:06:54
OK, so I I think as I said earlier, maybe way too long winded. 01:06:59
Is it the rest of the boards? 01:07:04
Pleasure that we asked him to continue this evaluation with maintaining the existing water quality objectives and the water 01:07:09
quality that we delivered. 01:07:13
Historically. 01:07:18
Can we have a discussion at our? 01:07:23
Next meeting or on the water quality so that we have a better understanding of what the objectives were. 01:07:25
And how they were being achieved, because I don't know that I've I fully grasped that. 01:07:33
I I heard you said a 300. 01:07:39
Parts per. 01:07:42
4,000,000 or per. 01:07:43
So. So maybe it needs to be better explained to me or maybe the other board members. 01:07:45
Would like that also. 01:07:50
I don't want to steal the show. I think these folks can answer what what that is. So and and maybe you want to take a stab at that 01:07:52
to maybe is it worth our time to do that now so you guys lead by I leave it up to you. 01:07:58
O our I'll take a shot at this, so. 01:08:05
The way that we were gonna look at the water supply modeling is we were going to use a baseline which is your current water 01:08:08
quality and then we were going to create a scenario that. 01:08:12
Slightly modified that. 01:08:17
Maybe. 01:08:19
A more cost effective blend. 01:08:21
And report that back. 01:08:23
And the intent of that would be to just show you what the cost? 01:08:25
Impacts are. 01:08:29
Ultimately, what comes out of that? 01:08:30
What would be in the work plan? 01:08:33
Our recommendation would be to. 01:08:35
Having the work plan to establish. 01:08:37
A water policy for what the water quality objective is. 01:08:39
And it could be as simple as just. 01:08:43
Here's a range. 01:08:45
I don't know that we would answer. I don't know that we need to answer that right now. 01:08:46
Will show you what how that impacts your costs. 01:08:49
So just so you have that information. 01:08:52
But that could be a future that could be part of this work plan as there will likely be other policies that come forward related 01:08:55
to practices and procedures that. 01:08:58
That could be in kind of. 01:09:02
Included in that it doesn't need to be. We don't need to answer that. 01:09:05
We can show it both ways. 01:09:08
Let me ask it differently. Is there a critical thing that you would like some direction from the board now or was this really 01:09:09
precious to receive and hear it? So when we started this process, we didn't know what the answer was gonna be. 01:09:14
And we started to go through the data and I think what became clear to me was that. 01:09:20
There are opportunities to create to to make HW a more cost effective. There are opportunities to streamline how it's operated. 01:09:25
And I think you have the right staff to do it. 01:09:32
It's just gonna be a matter of. 01:09:35
Creating a plan. 01:09:37
That then just has the commitment of of. 01:09:39
The board. 01:09:42
To actually implement. 01:09:43
And so. 01:09:44
The direction I would want back is. 01:09:45
As we started to develop this, we started to see that there are all these variable, there's these various things that needs to be 01:09:48
done. 01:09:51
What we realized pretty quickly is that it's not it's not like we can come back and do one report and solve everything. These are 01:09:54
some of these tasks are just working with staff. It's making sure that they get executed. 01:09:59
Like I said, there's a they're all different stakeholders and So what I would look for feedback on is. 01:10:04
We're going to build on what we started with the buckets and kind of starting to outline these tasks. 01:10:10
And what? 01:10:14
I would like to come back with if that approach is acceptable or you see the merit in it is, I'd like to come back. 01:10:15
With finishing out those tasks. 01:10:21
We're gonna build more of those work plan tasks and then start to draw out sort of a timeline. 01:10:23
And what that structure looks like, how would you actually execute? 01:10:29
This work plan and what's in it. 01:10:33
And that. 01:10:35
Is a perfect way to end the workshop as it. 01:10:37
Then gets the discussion going on, What do we actually want to do? Do we want to do this? Do we want to move forward? 01:10:40
And so if you're comfortable with. 01:10:44
The approach we've taken so far. 01:10:47
I would just look for that feedback so that we continue down that path. 01:10:48
So this is an informational. 01:10:54
Item only. There's no action needed, no vote required. 01:10:56
So. 01:11:01
Go forth and we'll see you in June. It was a June or July. June. OK. June, yes, June. You better get working. Alright. Thank you 01:11:02
so much for your time. And Andrew, I know this is a lot of information. Thank you, Mr. Gallagher. 01:11:07
Right. 01:11:15
I'm glad we're finally doing this, Yeah. 01:11:17
OK, so the next item is agency members reports, comments and requests for future agenda items. 01:11:20
Do we dare? 01:11:27
3. 01:11:29
OK, I have one. 01:11:31
It's actually something Director Debbie and I had spoke about quite a while back. Again, we're talking about how how this agency 01:11:35
is getting a little long in the tooth. 01:11:39
And we haven't addressed a few things since we've been long in the tooth. 01:11:44
I'd like to place on the agenda for us in the future if the other board members would support it. 01:11:49
Are considering the board's stipend at an increase in that we've been receiving. It was set at $50 back in 1994. 01:11:53
And. 01:12:03
Some of us take time off of our day jobs, spend time studying this material in advance. 01:12:04
And for me, like I said when the Beach District evaluated this, it's not about. 01:12:10
For me. 01:12:14
What's the incentive for anybody to sit up and do public service if it's costing them money to show up here? I'm not saying we're 01:12:15
nobody's paying their bills doing this, but it hasn't been addressed in 27 years and I I think it's a worthwhile. 01:12:22
At least conversation for us to have is important, OK? 01:12:29
It's hardly noticeable. It's like $50.00, right? If it's helpful, we could survey some local agencies and come back with some 01:12:34
comparables and things if that would be. 01:12:38
I I'd appreciate if the rest of the board supports it. If I'm the only one who wants to hear about it, I'll do nothing with it. So 01:12:43
I'll second that. Thank you. 01:12:46
As everybody in favour. 01:12:49
Aye, OK. 01:12:51
Anything else? 01:12:53
Alright. Anybody else have anything? OK. 01:12:55
So we're going to go ahead and adjourn the meeting at the time is 511. Our next meeting is scheduled for Tuesday. 01:12:59
June 20th, 2023 at 4:00 PM The meeting is now adjourned. Thank you, staff. Good job. 01:13:05
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Good afternoon. 00:02:05
Welcome to the Port Wanami Water Agency regular meeting. I am calling this meeting to order. The time is now. 00:02:07
4:00 PM. 00:02:13
Madam Clerk, may we have a roll call, please? 00:02:15
Member Bouchard. 00:02:18
Member Perez here. Ex Officio Member Jacobson. 00:02:20
Period. 00:02:23
Vice Chair Dibley. 00:02:24
Ohh, he's absent for the record and chair Hernandez here. 00:02:26
Thank you. 00:02:31
I can't have this. John is here Ohh sorry. 00:02:32
Member McQueen Legion Member McQueen Lejean here. 00:02:39
OK. 00:02:44
Radon. 00:02:45
Great. Thank you. 00:02:46
I have to say something about this room. It just looks fabulous. I really, really like it. Thank you whoever was behind putting 00:02:47
this up and the kids who did the. 00:02:51
The decor and the art, that's wonderful. 00:02:56
OK. At this time, we'll take public comment. Any general public comments not pertaining to items on the agenda? 00:02:59
Zoom Participants Can you use the Raise Hand feature if you would like to make any comments. 00:03:07
And any comments made will. 00:03:12
Require that you provide them within 3 minutes. 00:03:15
So, Madam Clerk, do we have any public comments for this? 00:03:18
Meeting we have one public comment for Mr. Donald Villafana. 00:03:22
Hello, Don. 00:03:27
Good afternoon board. I think most of you know me. My name is Don Villafana. 00:03:32
And first, I'd like to say that from what I've seen and heard. 00:03:37
I think Dennis Martinez has been doing a great job as your water manager. 00:03:42
Second, I think we're all very, very grateful that we had a a wet year. 00:03:47
And that our reservoirs are filling up. 00:03:52
But one wet year. 00:03:55
Does not recharge our groundwater basins. 00:03:57
And in the next decade, PHWA will be faced. 00:04:00
With the declining allocation. 00:04:04
Of groundwater. 00:04:06
Right now. 00:04:07
PHWA operating the plant. 00:04:09
Loses approximately 350 acre feet a year to brine discharge. 00:04:12
And at between 700 and $750 an acre foot. 00:04:18
That comes out to. 00:04:23
Over $260,000 a year. 00:04:25
But more importantly. 00:04:28
That's 350 acre feet of lost water. 00:04:30
In addition. 00:04:35
This last year, the 600,000 gallon water tank. 00:04:36
Was inspected with divers. 00:04:40
And a report done and given to the state. 00:04:42
The state gave PHWA. 00:04:45
A three-year time limit to drain that tank. 00:04:47
And rehabilitate the interior. 00:04:51
But before that's done, consideration should be given. 00:04:54
To building a bypass at the plant. 00:04:57
So when that tank is down. 00:04:59
United water can be used. 00:05:02
Instead of going on the high dollar. 00:05:04
Cayugas. 00:05:07
Right now. 00:05:08
If that tank, to bypass that tank you have to open a valve. 00:05:09
Near Pleasant Valley. 00:05:13
In Ventura Rd. 00:05:15
And if you do that, you can run on United Water. 00:05:16
But you cannot monitor the chlorine residuals. 00:05:20
And that becomes a problem down the line. 00:05:23
So. 00:05:26
I believe next month. 00:05:27
MKN. 00:05:29
We'll be touching on these and probably other items for your consideration. 00:05:30
So I appreciate the opportunity to speak this afternoon. 00:05:35
And it's Mark Twain so eloquently put it. 00:05:39
You know, whiskey is for drinking and water is for fighting. 00:05:42
So thank you for your time this afternoon. Thank you. Thank you, Mr. Villafana. 00:05:46
Are there any other public comments? 00:05:51
That concludes public comment. OK, thank you. 00:05:53
We'll now move to agenda approval. May I have a motion and a second to approve the agenda? 00:05:56
Move to approve. 00:06:02
2nd. 00:06:04
Thank you. 00:06:05
Madam Clerk, we please take a vote. All in favour. 00:06:07
Aye, all opposed. Hearing none. Motion carries unanimously. 00:06:10
Thank you. 00:06:15
We are. 00:06:16
You have no presentations. 00:06:17
So we'll move on to the consent agenda. 00:06:19
Let's see, we've got the Minutes register of disbursements and. 00:06:24
PHW A Monthly operational. 00:06:27
Sports. 00:06:30
Move to approve the consent calendar. All items 1-2 and three unless the water general manager prepared to give oral report on 00:06:33
the. 00:06:38
Operation. OK, I'll move to approve all three. 00:06:44
2nd. 00:06:48
OK. 00:06:51
Motion the 2nd May we have a roll call vote please. 00:06:53
All in favour. 00:06:56
Aye, all opposed. 00:06:57
Hearing none motion carries unanimously, OK. 00:06:59
We brings us now to public hearings. There are no public hearings, so we'll move on to pensions under business items item 4, 00:07:02
Pension. 00:07:07
Other post employment benefit costs. 00:07:11
Yes, hi, good evening. Yes, I have a presentation to go over the information. So good evening Chair and board members. Today what 00:07:16
I want to do is go through these presentation for the PHWA. 00:07:23
Outstanding liability related to pension and other post employment benefits. 00:07:31
And just. 00:07:38
To provide a little bit of background, the Governmental Accounting Standards Board sets the rules for both pension and OPEC. 00:07:39
The Gatsby 68 is for pensions, basically dictating governments. 00:07:49
How pensions need to be reflected on the books. 00:07:54
For both governmental and enterprise funds and as well as Standard 75 Gatsby 65. 00:07:57
That relates to other benefits such as medical, vision, dental. 00:08:04
And what happens each fiscal year, we get the actual aerial reports for both of these components. 00:08:10
They're done separately. The pension is done, but CalPERS and then we have a outside actuarial that does the OPEC. 00:08:17
And then the auditors go through that and they take a look at what the city has paid. 00:08:24
For instance, with pensions, we pay on a monthly basis with payroll and then we also do. 00:08:29
An annual payment which the city has an option to either pay. 00:08:33
Monthly or annually for the unfunded liability, and so the auditors do their calculation and they determine and adjust the pension 00:08:37
liability on an annual basis. 00:08:41
Umm. 00:08:47
And. 00:08:48
What happened for the Enterprise Fund? So this is not just specific to the water plant fund. 00:08:50
The city had not recorded any pension. 00:08:55
Liability. 00:08:58
And or associated cost? 00:08:59
To the Enterprise Fund, so in fiscal year 2020. 00:09:02
Which was the year that we also had new auditors. The auditors that had been with the city, had been with the city for quite some 00:09:06
time. 00:09:09
The auditors adjust. They made an adjustment. 00:09:13
To restate the pension. 00:09:16
Liability and the pension cost for all of the enterprise funds. 00:09:19
And so that year the other funds, we reflected the cost on the books and reflected the liability. 00:09:23
For Fund 443, which is the water plant fund, we didn't do it because we wanted to bring it to the board, so we've been. 00:09:31
Discussing this item and has hasn't been. 00:09:37
Closed yet? 00:09:41
And when you look at 443 right now, the water plant fund has a negative. 00:09:42
Fund, balance the deficit, basically because. 00:09:47
They need an injection of cash. 00:09:50
To cure this negative fund balance. 00:09:53
And. 00:09:56
And the total amount that needs to be funded. 00:09:57
Umm. 00:10:00
From PHWA, is that number up there 932,417? 00:10:01
And so I wanted to show the balance sheet. 00:10:09
As of 2019. So the balance sheet is basically your statement as of a specific point in time. 00:10:12
And you can see that it doesn't include down in the liability section. So the the top of it is the assets, the cash. 00:10:17
That the fund has. 00:10:24
As of that date as of June 30th, 2019. And then down at the bottom there's liabilities. At the bottom you see where it says 00:10:26
there's no pay, there's no pension liability. 00:10:31
That year. 00:10:37
And. 00:10:38
And then fast the the second, the second attachment is the 2020 where the auditors booked the liability. 00:10:40
And. 00:10:47
The associated deferrals, so basically what they do, they take a look at the liability and also the assets of the. 00:10:48
Of the pension and that's why there's entries to both. 00:10:56
Assets and liabilities, but the bulk of the number is the liability, the the net pension liability, the $1.3 million that they 00:10:59
book. 00:11:03
Umm. 00:11:08
And at that point in time. 00:11:08
Actually I attached the liability because if you look at the bottom, the fund. 00:11:11
And you can see it from this the. 00:11:15
The fund is in a negative position and it still is as a. 00:11:18
June 30th as of now and as of June 30th. 00:11:23
2022 and that's because of that liability. 00:11:26
Umm. 00:11:31
And So what I did is I took a look at how that liability would be allocated based on. 00:11:32
The water usage for that fiscal year since that's the year that it was booked? 00:11:38
And City of Port Wanami would. 00:11:43
Be obligated for 53.95% or $503,000 and 903 O 9. 00:11:47
And then you can see the all the different customers and the percentage and again that's using the water usage as of. 00:11:54
That fiscal year when the liability was booked. 00:12:01
The recommendation is to have this liability paid. 00:12:08
Over a three-year period and equal installments or. 00:12:13
Three or less. 00:12:17
And to start getting. 00:12:19
Funding that Fund 443. 00:12:20
With the funds and get that negative fund balance. 00:12:23
20. 00:12:26
And then how this would work? It would not impact the monthly bills. 00:12:29
We would do it. When we do that through up, we do it through up every year. 00:12:34
And build the customers either the overage or under. 00:12:37
Based on the total consumption for the year. So then we could do that. 00:12:41
The adjustment. 00:12:46
At that time. 00:12:47
Was judicially in around October. 00:12:48
Because we close the books in June. 00:12:51
September, October is when we have the actual numbers to do that through. 00:12:54
Any questions? I know this is a big number and it's been on the books and it was discovered. 00:12:59
Really. Two years ago and? 00:13:06
But it is a big number. 00:13:10
I'm sorry, what was the last thing you just said? It was this, well, it was booked in two years ago in 2020 and it's a large 00:13:11
number because it was not, yeah, it was not booked in the past. 00:13:16
Thank you, Miss Sarah, are there any questions for staff? 00:13:22
Ohh, yes. 00:13:31
Member Bashar. 00:13:32
I want to thank staff of again for taking the time to to meet with us independent of this explain it. 00:13:34
And as I said during that meeting, I always hate being the person to bring forward a problem without a solution. It's it's a 00:13:41
challenging issue. This one is from. 00:13:45
The beach districts perspective and and we want to make sure that the city is made whole. 00:13:51
So I just want to make a couple of statements that I hope that. 00:13:56
I understand the city's moving forward with a new time recordation system where you'll be able to more adequately keep track of. 00:14:00
Time spent at the water treatment plant operations and then we make sure when we're looking at. 00:14:10
The fully burdened cost of the full time equivalents that are booked out to the plant. 00:14:15
That whether or not that fully burdened rate. 00:14:22
Include some portion of the pension benefit. 00:14:25
To to ensure whether it does or it doesn't, but that we're clear on those things. My concern going forward as I said. 00:14:29
It is to correct the issue. 00:14:36
The. 00:14:39
The the difficulty from the beach districts perspective. 00:14:40
Is and it's not not an issue that staff can correct today, and I recognize that and I want to say this in the most respectful way 00:14:44
because it's not anything anybody here did. 00:14:48
27 years have gone by of the accumulation. 00:14:54
A pension liabilities on the cities side. 00:14:57
That. 00:15:01
Weren't booked out OPAB. Some of these requirements are new government reporting requirements that that that's the result of the 00:15:02
audit finding. 00:15:06
No fault of anybody here and I'm respectful of that. 00:15:10
However. 00:15:13
Without going through some forensic auditing process, there's no way for us to correct what I'm about to say. 00:15:15
The city existed long before this agency existed. 00:15:22
There are pension liabilities associated with city staff. 00:15:25
That are included in this number in some way, shape or form that were here before the agency. 00:15:29
They may be retired, they may be still on the books. It should correct itself as it goes forward, but I want us to be keenly aware 00:15:36
that the vote that's being asked today is for the Beach District. 00:15:41
To somehow be burdened. 00:15:46
With some of that stuff, and it may be it may be more, it may be less. I don't know what the answer to that question is without us 00:15:49
going through a forensic auditing process to figure it out, so. 00:15:53
I just want to make those statements and and would appreciate. 00:15:58
The support of the city as we move into this new phase of us. 00:16:02
Keeping that in mind and and bringing that forward to us so that we can feel confident in the future that we're we're trying to 00:16:07
that's the only solution that I can really come up with is that we make sure when we're booking the full time equivalents. 00:16:13
That we know whether the fully burdened rate carries any of this and if it doesn't. 00:16:19
Umm. 00:16:24
Then. 00:16:25
We we have the ability to look at that in the accounting and so. 00:16:26
I just want to make those statements with all due respect to the the city staff and to the members of the City Council here. 00:16:30
But I I would be remiss if I didn't make the statements on behalf of the the constituents I represented the beach district. 00:16:36
Thank you, Mr. Bouchard. Are there any other questions for staff? 00:16:44
Miss Lucero, could you bring up the slide that shows the? 00:16:50
The method of payment. 00:16:54
By each of the agencies of the allocation, yes. 00:16:57
So my question is for the city, the 53. 00:17:01
.95%. 00:17:05
Almost half $1,000,000. 00:17:06
Where would that money come from? 00:17:08
Did you say we're gonna true up? Do you think that would be for the cities portion that would be general fund. 00:17:11
OK. 00:17:17
You don't think that will be coming out of the reserves in any way or it would be a direct question? 00:17:21
The water, the Water fund. 00:17:26
The The Water Fund will be paying for that. The waterfront, OK. 00:17:30
Any other questions? 00:17:36
Yes. 00:17:38
The. 00:17:46
Activation. 00:17:53
Hmm. 00:18:50
Absolutely. 00:18:53
So with that said, how do you? 00:18:56
Does this board want to? 00:18:59
What do we want to request of staff in terms of follow up? 00:19:03
Would there be a report of some sort that? 00:19:09
We might expect down the road when you're ready to. 00:19:11
When you've done that analysis and or. 00:19:15
That forensic accounting, if yeah, if we're gonna do the three-year period that is being recommended then we can do. 00:19:17
We can do the math and and do the allocation of how much it's going to be per year. 00:19:26
And put something in writing. So we would want to have something in writing. 00:19:30
Umm. 00:19:34
With the term it would be a three-year term. 00:19:36
We, we were hoping to get this approved this fiscal year so that. 00:19:41
Everything going forward in the next fiscal year is is straight. We're happy to meet with Navy others. 00:19:45
You know, go through whatever detail folks want to have. We did meet with Mr. Bouchard. 00:19:50
Because he had some specific questions, I think that was useful and. 00:19:55
Was helpful and and he identified that and and. 00:19:58
Pretty clearly that we're happy to meet with others and go through the same process. I would like to sit down and have you go 00:20:02
through the numbers with me. So this is a very complicated something I don't look at every day, so. 00:20:07
Yes, absolutely. OK. 00:20:13
Director Cushman I just wanted to clarify, I I don't think the intent of my statement wasn't too task staff with a forensic audit 00:20:16
of knowing that 27 years and and trying to unravel what it would take to answer the question and the way that I would feel most 00:20:22
comfortable, I don't think that effort would be. 00:20:28
Money well spent on on behalf of us. 00:20:34
So. 00:20:37
Well, while I came here tonight thinking, gosh, I gotta vote my conscience and and can I I'm gonna, I'm gonna make a U-turn and 00:20:40
I'm gonna go ahead and support the staff recommendation tonight. 00:20:46
To move forward with maybe only the commitment that. 00:20:52
We receive a revised report of what the fully burdened staff rates are when the new time system and whatnot comes back, so that. 00:20:56
Members of other agencies can fully understand what that is. 00:21:05
So I'll I'll support staff recommendation with the request that city staff. 00:21:10
Look at what their new time allocation system and bring back that report of the fully burdened rate for employees and what's 00:21:15
included and not. 00:21:18
Thank you, Director. I think that's what I was intending not to go back, but to move forward with that information. 00:21:22
One, OK. 00:21:29
Yes. 00:21:30
So. 00:21:32
The information that you provided is from 2020. 00:21:33
So do not expect it to see any. 00:21:36
Thing like this for 2122? 00:21:41
So actually the number, the 932,000 is as of last year's audit because. 00:21:44
And every year they do the others, there's an adjustment, but the the number is not going to change significantly. So once it's 00:21:50
set, the liability set. 00:21:54
It it changes and it can change either way. 00:21:59
I'm in 2021 because their returns were so high. 00:22:03
It was actually a credit, so this is actually the number that needs to be. 00:22:06
Funded to fix that balance and then going forward it will be part of the financials. 00:22:10
Of PHW because there won't be a significant number. Great. Thank you. So I I just see 2020 on this sheet, but on this it does say 00:22:16
2022. So that's correct, 2022. Yeah. OK, great. Thank you. 00:22:21
I I think one way to to explain that is if you go back to your 2020 balance sheet. 00:22:28
That was up. 00:22:36
It was like 1.3 yeah, it shows a $1.14 million I think it is. 00:22:37
No money has been put into this as as as was stated. 00:22:43
And then in 2022 that number reduced and that's based strictly on the discount rate that Purrs applies to. 00:22:48
What your unfunded portion is, So if it does better or worse, this number will fluctuate on an annual basis. 00:22:54
But. 00:23:00
Yeah. 00:23:02
Yeah. So it's a combination of the the purse and then also the number of employees that are working. 00:23:02
At the plant because how staff distributes the liabilities based on payroll. 00:23:09
And so the people, employees changed dollars, changed the the dollar amounts going to change. 00:23:13
When you talk about race, you talk about how. 00:23:19
Staffs hourly rate and also staff allocations. 00:23:24
So people that move or position change positions so that payrolls never. 00:23:28
It it, it's always moving depending on. 00:23:33
Who's working at the plant? 00:23:36
Yeah. 00:23:38
OK. 00:23:41
If there are no more questions, I think we have a motion and did we get a second? 00:23:42
I'll second. Thank you. 00:23:47
All in favour. 00:23:52
Aye, all opposed. 00:23:53
Hearing none motion passes unanimously. 00:23:55
Thank you. 00:23:58
I look forward to sitting down and meeting with you also on this. 00:23:59
All right, let's move on to item 5, Strategic Planning Workshop. This will be one of two workshops. 00:24:03
I'm reading this correctly, staff, if you'd like to present the report. 00:24:09
Come on up. 00:24:13
Good afternoon. 00:24:32
In February, you guys approved through the strategic planning workshop. 00:24:35
So today we have perfectly two workshop. 00:24:40
Historical. 00:24:46
Trying to figure something out. 00:24:50
After years. 00:24:53
Mr. Ryan. 00:24:58
All right. Thank you. Members of the City Council and Board of Channel Islands, I appreciate the opportunity to be here. A little 00:25:05
bit of background on myself just to establish why I'm here today. 00:25:10
So I've been working in Ventura County for the last almost two decades. A lot of that has actually been in this sub region, so 00:25:16
served as a district Engineer for Channel Islands speech since 2015. 00:25:22
And then I've been doing the, I did the facilities master plan, a number of projects at that, your water treatment plant, the HW, 00:25:29
a water treatment plant and then a lot of planning documents just throughout the county so. 00:25:34
Understanding of the intricacies of all of the connected infrastructure, which you'll see here is. 00:25:39
There's quite a bit of. 00:25:45
So. 00:25:46
OK, so why are we here today? 00:25:50
This workshop is split up into two different sections. The 1st is going to be really focused on the background. I think it's 00:25:53
important given maybe the variable backgrounds amongst everyone here. 00:25:57
Some may not be as familiar, so we really want to build a common foundation to work from. 00:26:02
And ultimately, what's gonna come out of these two workshops? 00:26:06
Is essentially a work plan. What do we do next? And so hopefully we can come out of this building some consensus. 00:26:09
And have a concept or framework for which we can move forward together. 00:26:15
And so the way I'd like to proceed with this is I've got about 30 slides. I'll move through them at a fairly high level. 00:26:19
Stop me at anytime if you'd like me to dive deeper. You have questions. Chris is also here from MK, so we're gonna be capturing 00:26:24
any questions. 00:26:27
And we'll figure out how to get that information back to you, whether it's the next workshop. 00:26:31
Or in a separate follow. 00:26:34
OK, so first section is going to be establishing a baseline? 00:26:39
So. 00:26:42
How did all these water agencies operate prior to PHWA? 00:26:43
So what you can see here in the purple is all the member agencies of PHWA. 00:26:47
And what's in the sub bullets is basically a summary of what was happening in those agencies. So each of City of Port, Wanami, 00:26:51
Channel Islands, the Navy bases, all had their own local supply. 00:26:55
So that would be in the form of wells or connection to the United Water OH pipeline? 00:27:00
And what each of the agencies we're seeing independently was water quality issues, whether it be from seawater intrusion. 00:27:05
Iron and manganese, all types of water quality. 00:27:10
There was also the issue of seawater intrusion, which was impacting the reliability of that water source. 00:27:14
And what these agencies were doing is independently doing analysis, looking at. 00:27:19
Water treatment. Different water supply options. 00:27:23
And so it became clear that. 00:27:26
All the agencies independently were really facing the same challenges. 00:27:28
Which led to HWA. 00:27:32
So HWA was founded on some basic principles. 00:27:35
Basically that we wanted to create a higher water quality for this sub region. 00:27:37
There was a concern about the long term reliability due to seawater intrusion. 00:27:42
And also the opportunity to work together to have a cost effective solution. So obviously there's some economy of scale of having 00:27:46
a centralized treatment plant as opposed to everyone independently doing so. 00:27:51
So this is a simplified version of all the agencies involved in what it takes to get water to your member agencies. 00:27:59
So at the top, those logos are for United Water Conservation District. That's the and then of caucus, of course is spelled out 00:28:05
there. 00:28:07
So you have United coming in to the plant and that's where we go through the filters, that's the ROI and nanofiltration. 00:28:11
Cayugas comes in to provide water if, OH Pipeline United water is not available. It comes in during peaking. 00:28:17
Kaijus is a high quality imported water. 00:28:24
And United is your groundwater. It's lower quality. 00:28:27
And so the idea is you run that water through your plant and you create a higher quality water that's blended with a unfiltered 00:28:31
side stream and you deliver it to your member agencies. 00:28:35
Want to point out City of Oxnard, Their logo is on there. So how are they related to all this? Two different areas. The 1st is the 00:28:40
property itself that's owned by the city of Oxnard. It's a long term land lease the PWA has with Oxnard. 00:28:46
As well as the Oxnard conduits, the Oxnard conduit is the pipeline. 00:28:52
That's owned by the city of Oxnard that supplies the Cayugas Water Two Year Plan. 00:28:55
And so we've got two different ways that the city of Oxnard evolved. 00:28:59
You'll see the Cayugas logo shows up twice. You see them on the backside as well. 00:29:02
So the brine that comes out of the plant actually ties into their salinity management pipeline. 00:29:06
And so you've got a lot of different parties involved in in what what it takes to deliver water through your system. 00:29:10
So here's a summary of agreements that were developed so that. 00:29:20
PHWA could operate. 00:29:25
Not gonna go through each of these. What I'll point out is that. 00:29:26
Number one, there's a lot of agreements. 00:29:30
And so making modifications would take a lot of unwinding. 00:29:32
And then also that these. 00:29:36
You can see the correlation on when they terminate. It's all tied to the OH pipeline that's, I'm sorry, the OH agreement with 00:29:38
United, that's 2036. 00:29:42
So while you've been operating. 00:29:47
PHW for some time. You still have 13 years left on the existing agreement. 00:29:50
Agreements. 00:29:57
I'll walk through a couple of those agreements and just some. 00:30:00
Helpful highlights from those agreements. So you've got the JPA agreement. 00:30:05
There is an operational audit that's required to be performed every five years. The last one was performed in 2015. I'll dive a 00:30:08
little deeper on that in a future slide. 00:30:12
You also have capital costs. So capital costs, OEM costs, basically the operating costs and how that's appropriated to the 00:30:17
different agencies is all defined in those agreements. 00:30:22
Which I'll I'll show in another slide here. 00:30:27
You've got the water sales agreement, so each of the agencies has a water sales agreement. 00:30:29
It should be pointed out that some of those agreements actually highlight minimum and maximum flows. 00:30:33
So there was an intended operation of the plant in those agreements. 00:30:38
How well that's followed today. 00:30:42
Maybe has modified a bit? 00:30:45
And here in the last one is your connection to the selenium management pipeline. I do want to point out that there's a value to 00:30:47
this. It's a little difficult to quantify, but I can tell you most brackish water facilities don't discharge their brine for free. 00:30:51
You do. 00:30:55
So that's really an asset that was negotiated. 00:31:00
As part of Cayugas bringing their salinity management pipeline through the City of Port Mini. So there's a value there that that 00:31:02
should be recognized. 00:31:06
Another interesting item, the Imported water service agreement. That's with Cayugas. 00:31:12
Cayugas, when this project was developed, actually put some money in on the capital side, which offset some of the costs from the 00:31:16
member agencies. 00:31:20
And as part of that agreement, they actually have access or the ability to use excess capacity in the plant. 00:31:23
Now, while they don't do that. 00:31:28
I think it's an interesting opportunity to look as we look forward, are there ways that we can continue to partner with colleagues 00:31:30
to offset costs and create more economy of scale? 00:31:34
So it's just an interesting piece that's already was really built into the original concept. 00:31:38
The OH pipeline. This is another item. 00:31:43
You have a take or pay for that for that water supply agreement for the H pipeline. 00:31:46
And this is maybe something that isn't paid attention to very much, but it's certainly an incentive to use all your united water 00:31:50
as you as you pay, even though you don't use it. 00:31:54
And then finally, the third party agreement. 00:32:00
On here. 00:32:01
As you well know, that agreement has some language related to the transfer of of credits. 00:32:03
And so this is just pointing out that there's still some unresolved issues in some of these older agreements that. 00:32:08
That need to be updated. 00:32:13
So I mentioned the cost allocations. You can see on this table you've got the member agencies. 00:32:17
You've got capital fixed. 00:32:21
Fixed O&M in variable and what I wanted to point out here is. 00:32:24
These numbers were established as part of the original JPA. 00:32:27
And what I'd highlight is on the variable costs. So the variable costs reflect more with how water is actually being used today. 00:32:31
Whereas the fixed. 00:32:37
United and fixed O&M, those are numbers that were established based on. 00:32:38
The original. 00:32:43
Capacity what each agency thought they were gonna need. 00:32:45
And so I would just point out that those don't. 00:32:48
Align perfectly, but they're actually fairly consistent with each other. 00:32:50
So what is the infrastructure look at? 00:32:56
You've got the water treatment plant. It's a laser. 00:32:58
You guys are looking at different screens. 00:33:01
Water treatment plant that's right in the center with the blue star that's that's the plant. 00:33:04
You can see the pipelines, those are the different colored lines running out of there delivering the water from the water 00:33:08
treatment plant to the member agencies. 00:33:11
What I wanted to point on this slide is is 2 things. 00:33:14
1st is that because? 00:33:17
Of where the turnouts are for the member agencies, the ownership of those pipelines actually varies. 00:33:19
With you can see on the right with that yellow line. 00:33:25