 All right, I'd like to call to order the March 16, 2023 meeting of the Board of Public Utilities and ask Secretary Montoya to do a roll call. Thank you. Board Member Wright. Here. Board Member Watts. Here. Board Member Walsh is absent. Board Member Barthelot. Here. Here. Board Member Batenfort. Here. Vice-Chair Arnone. Here. Here. And Chair Galvin is absent. So let the record reflect that all Board Members are present with Board Member Walsh and Chair Galvin absent. Thank you. First item is to ask if any Board Members have any statements of abstention. Yes. Thank you, Chair. Thank you for agenda item 5.2. For the recycled water portion, I am going to recuse myself from participation to avoid any actual or perceived conflicts of interest due to my role at Sonoma County Farm Bureau and the fact that some of our members contract directly with the City of Santa Rosa for reclaimed water. So for that portion, I will recuse myself. Thank you very much. Are there any other statements of abstention? Seeing no hands raised. Next item is minutes approval and we'll first open it up for public comment. We're now taking public comments on the minutes approval. If you wish to make a comment via Zoom, please raise your hand. If you are dialing in via telephone, please dial 9, star 9 to raise your hand. So first of all, are there any people in attendance who would like to make a public comment? Seeing no one. Secretary Montoya, do we have anybody live or, excuse me, in Zoom or e-mail? No one on Zoom is raising their hand for public comment and no voicemail or e-mails were received. Very well then. Then if there are no changes from Board Members, the minutes will stand approved as submitted. Staff briefings next. Please, if you will, Director Burke, introduce item 5.1. Thank you, Vice Chair Arnone, and members of the Board. Item 5.1 is going to be our 2022 Water Infrastructure Report Card Staff Briefing. And Lori Urbanoek, our Deputy Director, Engineering Resources, will be presenting. Thank you, Director Burke, Vice Chair Arnone, Board Members, I'm here today. Lori, can you hold on just one moment? We are having trouble hearing you. Okay. Lori, could you test your audio for me, please? Lori, can you go ahead and test your audio for me, please? Lori, could you mute yourself and then unmute again, please? We're having trouble hearing you. Lori, are you able to mute and then unmute and see if we can get your microphone working? Yes, can you hear me now? Yes, we can. Lori, go ahead. Deputy Director Burke, Vice Chair Arnone, members of the Board. My name is Lori Urbanoek. I'm the Deputy Director of Engineering Resources. And it is my pleasure today to present the 2022 Infrastructure Report Card for Santa Rosa Water. Next slide, please. So first I'll go over the purpose of the report card, the categories and process and criteria that we use to create the report card grades. And then finally at the end we will present our recommendations to raise the grade. Next slide, please. Santa Rosa Water's mission is to provide essential water services and invest in a sustainable future for our community. It's our responsibility to maintain the infrastructure to protect public health, the environment and economic likelihood. Next slide, please. The purpose of the report card really is to inform the public and decision makers about the current condition of our systems and to identify recommendations for improving them over time. Let me point out that the first report card that we produced was back in 2017. This report card summarizes the high level assessment on our water infrastructure. And it will include each of our systems, the water, wastewater and our regional reuse water systems. Next slide, please. This slide is just to remind everybody of the number of assets that we have in our drinking water infrastructure system. Santa Rosa Water delivers approximately 6 billion gallons of drinking water each year. The city's water distribution system contains a little over 600 miles of pipe, which comprises the backbone of our infrastructure for the delivery system. About half of these water mains were installed between 1960 and 1985. Therefore, they're reaching near their end of their useful life and would normally begin replacement in 2025. I'd like to point out too that our drinking water system is continually monitored to ensure that our drinking water needs or exceed drinking water requirements as regulated by U.S. Environmental Protection Agency and the State Water Resource Control Board. Next slide. You'll notice here that the wastewater side mirrors pretty closely to our water distribution. Again, our mission here is we need to maintain our wastewater infrastructure as a top priority in order to protect public health, the environment, and extend by extending the useful life of our infrastructure. And it should be one of our top priorities. Again, we have about just a reminder that the number of assets that are contained in this system includes over 600 miles in Maine. 72 miles of that consists of our large diameter trunk system. Because of the high level of risk and consequence of failure on along our trunks, the next 10 years rehabilitation of these trunks will comprise most of our CIP replacement or rehabilitation over the next 10 years. Next slide, please. And now for our regional water reuse system. This is a complex system that includes treatment facilities, our recycled water distribution system, the geysers pipeline, the agriculture reclamation system, and of course our seasonal storage ponds and biosolids facilities. Many of these reuse facilities were built over 60 years ago and have reached at the end of their original design service life. We have many assets of concern such as the aging structures, mechanical and electrical equipment and many, many miles of underground buried pipe and electrical conduits. Next slide, please. Talk a little bit about the process that we went through on this report card. It began with an assessment that relied on interviews with our system managers, a review of our master plan and condition assessments and maintenance documents. An analysis of our system data and a review of our capital improvement program financial projections. Next slide, please. To assign grades we use this established grading system that all of you may recognize from your days in school that uses A through F, A being exceptional as I know many of you students probably were, and F failing which I'm sure none of us fit that role. So this has been established and used for many years by the American Society of Civil Engineers and their guidelines as an easy way to communicate to the American citizens on the state of infrastructure. Next slide, please. As far as the criteria, we use their criteria and we asked ourselves many of these questions. Does the infrastructure meet our current and future demands and that relates to our capacity? As far as condition, what's the existing and what's our near future physical condition? And what about that funding? Does our funding current funding compare to what is needed for future improvements? This is a question for operations and maintenance. How is it for you folks to operate and maintain compliance and public safety? This is really about the potential of consequence of failure and risk to our citizens. It should a system fail as anyone's safety jeopardized. And again, we all hear this word resiliency, especially with our recent storms. Thankfully, it hasn't been too bad in Santa Rosa. But as you many of you may have seen on the news, there are multi hazard threats and events and flooding is one of them. And how quickly can we recover and restore critical services to our community? And then finally, we talked a little bit about innovation and what new techniques and materials and technologies are being implemented in our infrastructure. Next slide, please. And here are the grades for 2022 as opposed to the grades that we had back in 2017. And what I'd like the audience to take away here and the board to understand is this is the first year we have a benchmark to compare the transition from this year back five years to 2017. And what you'll notice here for the water system is it's remained pretty good. It's coming in at a B, which means it's good and adequate for now. As we look at the wastewater system, you'll notice that it slipped a little bit. It went from a B minus in 2017 down to a C plus. And we attribute this decline largely because of the condition assessment that we recently got through on the trunks and their deteriorating condition and need for rehabilitation. And unfortunately, our regional reuse system has dropped from a C, which is needs some attention down to a D plus, which is puts it at a poor and at risk facility. This is largely due just to the design life of the entire system. Next slide, please. And so how does Santa Rosa measure up against the rest of the country with wastewater and water, you can see that we are doing quite well when we compare ourselves to the rest of the nation. And you'll notice there aren't any comparative grades on the regional reuse system. And that's because we truly have a unique system here in Santa Rosa. There aren't many tertiary treated treatment plants. And I'm not sure that anyone else has a reuse facility like the geyser system. So that's something we can be quite proud of. So the next question we have to ask ourselves is, what do we do to improve these conditions and raise our score? Next slide, please. On the water system, we want to continue to take, make sure we're doing fire flow improvements and raise the grade by hardening our pump stations that are located in the wild land, the wildfire urban interface area, otherwise known as the wui. And then we added this new one instead of just replacing pipe in different locations because of age. We recognize that the Rogers Creek fault is near, runs through Santa Rosa and is likely to experience a significant quake in the next 30 years. And so we're introducing this new program really to start looking at replacing pipe segments along that fault line with more earthquake resistant designs and materials. Next slide, please. And again, because the wastewater system sort of mirrors the water system, you'll notice much of the recommendations are the same, which is hardening our pump stations located in the wui and continuing to rehabilitate our aging Trump lines. And again, because the collection system crosses the Rogers Creek fault line through the city, we also want to start retrofitting some of those pipeline segments actually replacing them with earthquake resistant design and materials. Next slide, please. And for the recommendations for the regional reuse, we have two key, two key measures that we feel are needed to help improve this grade. And one of them, the first one is to increase the capital improvement program staffing levels to implement projects, and then to increase the capital improvement funding levels to meet our current and anticipated needs. Next slide, please. And finally, I would really like to thank our operations staff for the hard work that they do every day, maintaining our vital infrastructure infrastructure for our community, and also for participating in this report card exercise. And with that, I'm happy to take any questions. Thank you, Deputy Director Urbanic. Are there any questions or comments from any of the board members? Okay, apparently not. So let's open this for public comment. We're now taking public comments on item 5.1. If you wish to make a comment via Zoom, please raise your hand. If you're dialing in via telephone, please dial star nine to raise your hand. Is there anybody in the room who would like to make a comment? Apparently not. Secretary Montoya, is there anybody online? There are no hands raised for public comment on Zoom and no email or voicemails were received. All right, thank you. That will conclude item 5.1. So moving to 5.2. This is going to be presented by Deputy Director Peter Martin, and I understand we have one abstention from this item. When we get to the recycled water portion of it. Okay, very good. So we're going to take this in two parts then. Please proceed. All right, sorry for the delay there. Good afternoon, Vice Chair Arnone and members of the board. Very happy to be with you today with a water supply update. Very brief water supply update. I just wanted to highlight that Lake Pillsbury storage today is at about 64,700 acre feet. We did hear just off the presses this morning that PG&E made a press release that they will not be able to operate their radial arm gates and slide gates like they had previously. So before April 1st, they do have an opportunity to store additional water in Lake Pillsbury of about 20,000 acre feet due to some revisiting of some seismic modeling that they've done. What that means is that the all likelihood it may create challenges for water supplies in the upper Russian River. So we'll be tracking that and learning more from cinema water at some point, but something definitely to track which is learned this morning. And in terms of Lake Mendocino storage today, storage is about 93,600 acre feet. If you'll recall, some water turned over operations to the Army Corps of Engineers some time ago releases today are at about 1400 to 1500 cubic feet per second. And they are operating under their curve with enhancements from the forecast informed reservoir operations. So definitely taking advantage of these storms while also taking advantage of this lull in the storms to make some releases and continue to protect those downstream communities over this time as well. And then the big story is that storage in Lake Sonoma as of today is about 297,000 acre feet. And the Army Corps put out a press release yesterday notifying everyone that they will begin making flow control releases as of yesterday. So they are now releasing at about 4000 cubic feet per second downstream of Lake Sonoma. What you'll notice is that that black line does trend very closely with the 2016 water year, which happened also be a drop buster. So here we are and it's looking very good and very similar to what we saw coming out of the last route. And then just in term of rainfall to date, you know, as of earlier this week in Yukia where it tends to really count the rainfall to date is 118% of normal. And for Santa Rosa, it's at about 123% of normal. So as you can see, we're very much very closely approaching what we would typically see for rainfall in an entire year. So off to a very good start. And it's definitely a tale of two water years compared to last year and the year before that. So just to recap, Lake Minasino storage encroached into the flood control storage area on January 8th. The Army Corps is now operating and making releases and also allowing for snow water to store additional water under their forecast and form reservoir operation assisted major deviation. This is something they put into place with quite a bit of work. So Lake Sonoma water is able to store additional water that they hadn't in the past. So this is very good news shows that it's working and also the same goes for Lake Sonoma. They are have a minor deviation that's allowing them to store an additional 19,000 acre feet above the typical 245,000 acre feet of water. So some good coordination, a good story to tell for our water supplies and coordination between Sonoma water and the Army Corps of Engineers. And then I just wanted to highlight that the Snowmarin State Water Partnership Annual Report was released. It's available online. I did provide a hard copy for all the board members today. But just wanted to, there's so many highlights to list, but I just wanted to highlight a few of those. And that's that 922,000 square feet of turf was removed during that last fiscal year. A good portion of that was here in Santa Rosa. So we'll pat ourselves on the back for that. 25 water use efficiency workshops were held regionally, as well as 24 pop-up events. As you recall, we held the pop-up events for the drought and handing out drought resources throughout the region in Sonoma and Marin counties in a coordinated fashion. And furthermore, again, the Sonoma and Marin Water Partnership was awarded two EPA WaterSense awards. One for the outreach related to our Drought Is Here Safe Water Program, or excuse me, Outreach Program. And the Qualified Water Efficient Landscape Program again received an award. And furthermore, the regional average gallons per capita per day continues to follow a trend downward. It's about 97 gallons per capita per day. So some good work being done amongst the Sonoma and Marin Water Partnership and the 13 utilities that participated in that, including Santa Rosa water. With that, I'll take a pause while we have Board Member Barthelot here to take any questions you may have on my water supply update. Thank you. Are there any questions on Deputy Director Martin? Martin's presentation before we move to the next presentation. I do not have any questions. Any questions? Yes. How about that? So the additional storage in Lake Sonoma, you said it was 19,000. For some reason, I thought it was 8,000. Is that based on a similar curve as it exists at Lake Mendocino? Yeah, so there was an initial 9,500 acre feet amount that they were able to store under the minor deviation. And that increased over time up to March 1st, between February 15th and March 1st to 19,000 acre feet. So they are allowed to encroach even further under their minor deviation requests with the Army Corps. So that's the max, is 19,000 extra? Correct. Okay, thank you. Any more questions concerning water resources? If not, then... Oh, yes, I'm sorry. Not a question, but a comment. I think you pointed out that the trend is very similar to 2016. And that was, I think, my first full year on the board. And I just also appreciate seeing the water, the saving water partnership presented at the same time. Because as, you know, we didn't take us that long to fall back into a drought. So it's great to see that there's still ongoing events that we are participating in as a utility with the Sonoma Rain Saving Water Partnership. Because as we know, we can't rely on that we will stay with this much water. So I just really appreciate being able to see both sides of that in one report. Thank you. Thank you for yourself from the podium. Deputy Director Prince, please let us know what's happening with regional water reuse operations. Good afternoon, Vice Chair Arnone and members of the board. It's very nice to be in front of you in person today and see you all in the flesh. Feels good. I have two main things I want to go over with you today. One is our recycle water storage status and discharge, but then also I have some slides about our disinfection system upgrade as well. This is a chart which you have seen, I think, many times before, although there's always a little bit of an increment added every time I show it to you. And the trend that I want to draw your attention to is the red incomplete, as far as the water year is concerned, trend for the current water year. You'll see on the right hand side it takes a drop downward like other storage curves you may have been seeing recently. And that's attributable to discharge that we have been conducting. We've been doing some intermittent discharges. We started in January and we've recently been making a more significant correction in the storage curve. And the reason that we're doing that ultimately is we have a finite amount of storage like almost any water storage reservoir. And we need to make corrections when weather conditions allow us to do discharge and compliance with our permit. So ultimately the points I want to make are we have been breaking records as far as storage levels are concerned. You can see the maximum levels recorded over the time frame that I think is listed as 2004 to 22. We just show the maximums at any given point throughout the year. And there have been times this year where we've exceeded that blue line at the top, that light blue line. And that shows that we have been making new records, if you will. And we've recently dropped our storage levels to below record breaking territory. But we have been exceeding maximums historically, the historical maximums. Shifting gears, I want to talk a little bit about discharge. We've been discharging from three locations from the system, actually. Some from Delta Pond, which is our main discharge location, and two from Pond D. This is a picture I took about two weeks ago looking at the northwest corner of Pond D, which is part of our Meadow Lane storage complex just across from the treatment plant out on Lana Road. In the photograph, you can see the horizontal green berm of Pond D. And the body of water that you see in the photograph is basically our discharge channel from that pond. And this, in all honesty, is a screen grab from a video that I took, and I caught a moment specifically showing that there's sort of an a burst of air that's coming out of the discharge pipe, which is shown by that white, cloudy, misty presence there in the photograph, just showing you really where that pipe daylights in the channel. And the air does get entrained in the pipe during discharging it, and it sort of vents through the discharge when that happens. I will say that under many conditions when we have discharge from Pond D, the area that you see where the people are standing there is flooded by the Laguna and Colgan Creek. So this is kind of a unique condition. In this photograph, the Laguna de Santa Rosa is on the right-hand side out of the field of view. And when I was standing here taking this photograph, Colgan Creek was more or less behind me. And so this is right near the confluence of Colgan Creek and the Laguna de Santa Rosa, which is essentially right where the discharge channel is aligned. The people in that photograph, I have another photograph showing them, but they are all participating in various ways in the discharge and monitoring data and things like that. These are a couple of different views of that same portion of the discharge system. On the left, it's just a close-up that shows actually a rainbow in the mist from the discharge. I thought that was kind of an interesting photograph. And then the view on the right is more or less the opposite view from the picture that I took earlier. That picture on the right is from nearly the top of the pond, the berm, again, just showing the discharge channel aimed directly at the confluence of the Laguna de Santa Rosa and Colgan Creek, again with air venting out of the discharge. This is another screen grab from a video that I took that is a view down in the overflow riser on the interior berm of the pond D. And what you may be able to tell in the photograph is there's a very significant jet of water leaving a valve in the bottom of this riser that valve controls the discharge. It was actually upgraded not that long ago, but the video of this is actually quite impressive. Looking down that riser sounds something like a jet aircraft taking off. It's pretty impressive. In fact, it's ominous. It's pretty intense. There's a lot of energy there. But the diameter of that valve, I think, is three feet. It may be 30 inches, but it's a very significant jet of water. And that jet of water is in the vicinity of 26 or 29 million gallons a day in terms of a flow rate. So it's a pretty significant graphic, I guess you could say, relative to our discharge in general. I have watched the video of this several times. I can't quite get over it. It impresses me anyway. Moving on, data collection is a significant part of our discharge compliance program. On the left is a data sonde, which is an aggregate of a number of water quality measuring instruments, pH, turbidity, DO, and temperature that we need to comply with in terms of our discharge and the volume or the flow rate of our discharge. On the right is a picture of Jason Bishop. He is a wastewater operator in the Reclamation System group. He's got a ton of experience and he's been focused most recently on the geysers and working on the operation of the geysers. But due to his experience helping out with discharge, he's been heavily involved in the discharge and I thought it would be good to give him a little publicity relative to that. On the counter next to him are more data sonds. We have, I think, 10 of those and they are worth about $12,000 a piece. We have an investment just in the data collection side of discharge. We do collect data upstream and downstream of our discharge points. And then also a lot of sampling is done of our pond water quality and receiving water. And this is the group of people that were in the earlier photos. On the left is Steve Jacobs followed by Andrew Romero. And then the three people on the right are with water course engineering. They help us navigate the data collection and interpretation and management of our compliance and weather windows, receiving water flow rates, and really to determine what maximum allowable discharge flow rates could be. That's very important for D-Pond because we don't have an automated system for the discharge from D-Pond. We do it at Delta and the valve positions that control that flow rate are connected up essentially to the data sonds and USGS stream gauges and we can pick a set point and use a discharge model to modulate the flow rates according to the way receiving water parameters fluctuate. But in the middle of the photograph is Mike Diaz and then there's Stacey Tanaka and then Brooke, I forgot her last name. I keep forgetting her last name. Anyway, moving on. Discharge to date. When this PowerPoint was put together we had discharged about 522 million gallons. That was as of two days ago. We tapered our discharge off to zero yesterday so the total actually is a little over 550 million gallons that have been discharged. That includes 224 million gallons out of Pond D and 331 from Delta Pond. One thing I neglected to mention is we do have two discharge points from Pond D. One is the valve controlled gravity discharge that I showed you the photo of. The other is a very small floating pump that we actually discharged a smaller flow rate from directly into Laguna de Santa Rosa. As I think you all know we have some very stringent water quality discharge parameters and we have phosphorus credits that we consume when we discharge our recycled water. The volume that we've discharged equates to over 8,157 pounds of phosphorus which consumes a one-to-one ratio on discharge so we've consumed that same number of credits. That does leave behind a reasonable balance of credits but we have used over half of the credits that we have on file. So right now we have in the vicinity of 7,400 credits available to use if we need to continue discharging this year which we may depending on the weather in our storage levels. 15 years I want to talk about a very significant capital improvement project out of the treatment plant. As I think you all know we are under contract to construct our new UV disinfection system. Total payments to date are nearly $8 million. We have another progress payment ready to go so we'll be bumping up over $8 million very soon. That is over 10% of the contract value which right now is $68.1 million total. There's a lot of focus right now on mass excavation. I'll show you some photos of that which require sheet piling to be installed and our existing hypochlorination system conflicts with part of the construction footprint so we're working on relocating that hypochlorination system. The graphic on the right is basically just a reminder regarding a notice that you may have already received regarding traffic patterns having changed at the plant. The south entrance to the plant has historically been the main entrance. Recent history I should say. That is dedicated to construction only so entering the plant is via the middle entrance to the plant. The width of that entrance is such that we're having people leaving the plant exiting out of the north exit which is really an exit only under normal conditions so we have a pretty elaborate signage system to help direct people to the proper exit of the plant. We anticipate this being in effect for the duration of the project. Construction photos of projects like this seem to be improving a lot because drones are being used quite a bit and these are two photos taken with the drone from essentially the same perspective. On the left is a photo that was taken in February that shows the mass excavation being done on the lower left hand corner of the site. On the upper right hand corner of that photograph you can see the hypochlorination system footprint starting to take shape. The photo on the right is much more recent. I think that may have been within the last two weeks and there's a lot more activity. The first cut of mass excavation is done and sheet piling is being installed in that general area and you can see in the upper right of that right hand photo that the hypochlorination underground work is also advancing nicely. This is a pretty good photo because it shows the entire scope of the project. This is as sheet piling installation was beginning to be set up. I have a photo coming up about the actual equipment that's being used but you can see in the upper right photo of this photo the hypochlorination system footprint as well. I'm expecting that I'll be able to provide drone based photos of the project as it goes forward so I think it will be interesting to show how things change from similar perspectives. This is the sheet piling pile driver that's being used to install sheet piles. They are required so that we can excavate deeper this portion where that pile driver is located is where there's going to be a wet well which is about 10 feet deeper than where the tracks of that piece of equipment is right there. The reason that we have sheet piling is so that we can actually confine the limits of the excavation and actually do vertical excavation because the sides of the excavation are supported by the sheet piling. They're continuing to do this. It's a pretty lengthy process and they are encountering some fairly resistant layers at depth so they're having to switch from what is a vibratory pile driver to an impact driver both of which are pretty impressive when you're standing near them. You can feel the vibration that they create in the ground. I will also say that there's a lot of precautions that have been taken to protect two 54 inch diameter effluent lines which go along the upper limit of this excavation that you see in the photograph. They are underground but they are fairly old and we're concerned about making sure their condition is adequate throughout the entire project. So we have vibration monitoring that's continuing on throughout this phase of the project just to make sure that vibration doesn't exceed levels that would be a concern as far as the condition of those pipes is concerned. So that ultimately is the sum of my presentation and I would be happy to entertain questions if you have any. Thank you for your concise presentation, Deputy Director Prince. Are there any comments or questions that anybody has? Just curious, did you get any groundwater in that big pit you dug out there? There's a little bit but I think there's less than people expected. We did actually get quite a surge of rainwater recently and I have some photos of that that I did not include but some of the crane mats, the large timber that the pile driver was moving around on and those are necessary to keep from sinking into the bottom of the excavation. Those floated somewhat and so there was some concern. Right now groundwater is not a concern but I think it will become a concern as we start to excavate deeper with the sheet piling having been installed but we have dewatering wells that are being constructed to lower the groundwater table in that area so that we don't have groundwater related problems during construction. Thank you. Thank you for your comments. I had one question about our phosphorus credits. Do we have any projects in the pipeline to restore the balance of our phosphorus credits or what's the status on that? I don't know right now. I wonder if Director Burke would want to mention that. So we are continuing to explore options especially looking at options with our partner in the audience, Sonoma Water for projects for phosphorus credit removal but we don't have anything quite on the books yet but that is something we do recognize we need to continue to explore projects because we're going to be using a lot of the credits this year. I would add that I do stress for staff the importance of making very careful decisions about discharge volumes and storage curve corrections via discharge because there's more to the picture than just the storage volumes obviously we need to preserve those credits as much as possible. Any other questions or comments from the board? Seeing none, let's open it for public comment. If you wish to make a comment via Zoom please raise your hand if you are dialing in via telephone please dial star 9 to raise your hand. Is there anybody in the room who would like to make a comment? Seeing none, Secretary Montoya, do we have anybody? There are no hands raised on Zoom for public comment and no email or voicemails were received. Thank you very much then. That concludes this item. Thank you for your presentation. I think we can go back to full strength and bring back board member Mark. Sorry, Vice Chair Arnone, I believe she's joining us right now. Very good. That brings us to item 6.1 which is the consent items. Does anybody want to take anything off the consent calendar? Do I have a motion to approve the consent calendar? I'll move the consent calendar. Okay, there's been a motion in second. We're taking public comment now on the consent agenda item. If you wish to make a comment via Zoom please raise your hand. If you're dialing in via telephone please dial star 9 to raise your hand. Is there anybody in the room who would like to speak on the consent calendar? Seeing none, Secretary Montoya. There are no hands raised on Zoom for public comment and no voicemail or emails were received. Very well then. Could you please take a roll call vote? Board Member Wright. Aye. Board Member Watts. Aye. Board Member Barthalo. Aye. Board Member Batenfort. Aye. And Vice Chair Arnone. Aye. And that passes with five affirmative votes with Board Member Walsh and Chair Galvin absent. Very good, thank you. Director Burke could you please introduce item 7.1. Thank you Vice Chair Arnone and members of the board. Item 7.1 is a funding agreement between State of California Department of Water Resources and City of Santa Rosa for direct install water use efficiency project and Claire Nordley our sustainability coordinator over our water use efficiency team will be presenting. Good afternoon Vice Chair Arnone and members of the board. I'm Claire Nordley and I'm going to be discussing the funding agreement between the State of California Department of Water Resources and the City for a direct install water use efficiency program. So before I launch into what the funding agreement entails and the responsibilities I just want to touch on what a direct install program is. It's actually the purchase and the installation of toilets and water using fixtures at no cost to Santa Rosa water customers. So the fixtures include shower heads, bathroom aerators, kitchen aerators. So we actually contract with qualified plumbers and then the plumbers install these fixtures for our customers at no cost. Thanks. So we have many programs in the past that relate to toilets and water using fixtures. So we've actually replaced over 50,000 toilets since 1992 in our service area. That's been through rebate programs. We actually have done a direct install program previously and we've also done a distribution program. And of course we always provide free water using fixtures to any of our customers. So this funding agreement specifically is with the Department of Water Resources for $1.5 million. This budget was appropriated from the Budget Act of 2022. For Santa Rosa water our responsibility is $0 in match. Although of course we will providing staff time to actually implement the program. And then the state will disperse the whole of the state funding with our first invoices of middle. So it's not a reimbursement program. So some of the terms to be aware of, the Department of Water Resources responsibilities are of course for them to provide payment. They can audit the awardees as well. And then our responsibilities are to submit the invoice, to submit annual progress reports as well as a final completion report. And then of course implement the actual direct install program. So for this proposed program we are recommending that we remove and recycle toilets that flush 1.6 gallons per flush or more. And those would be replaced with either a 1.1 gallon per flush or a 0.8 gallon per flush toilet depending on the customer class. And then of course removing fixtures, so removing high flow shower heads, bathroom faucet aerators and kitchen faucet aerators and replacing those with high efficiency models. This program would be open to all of our customer classes. So single family, multifamily, commercial and industrial and institutional. And it is first come first serve since we have a limited pot of funding. And then we estimate that we'll be replacing about 2,000 toilets. It's hard for me to give an exact number for that because we want to make sure that it's open to all customer classes but commercial toilets cost a little bit more and so if we don't get as much uptake in the commercial sector we can move some of that funding to our residential sector. So it'll be about 2,000 toilets. So the next steps if you all approve today would be for us to release a request for qualifications to create a list of qualified plumbers. We would then select all of the qualified plumbers and have a list up on our website and then we would advertise the program really emphasizing customers who may need the water savings the most specifically mobile home park residents and our help to others customers. We'd launch the program. We would submit an invoice to the Department of Water Resources for the total payment sometime around June which is the first date that we could do that and then we need to expend the funding by June 2026. So with that it's recommended by the contract review subcommittee and Santa Rosa water staff that the Board of Public Utilities by resolution approve the funding agreement between the State of California Department of Water Resources and the City of Santa Rosa to implement the direct install water use efficiency project and authorize the director of Santa Rosa water to execute the funding agreement and related documents. And with that I'm happy to take questions. Thank you very much. Are there any questions or comments from the board? One quick question. I didn't hear it but when do we anticipate that we will actually be on the ground installing these toilets if everything goes well? Well it depends on how fast we could release the RFQ and get qualified plumbers involved. I'm hoping this summer. Thank you. Not a question but congratulations first of all it's a very exciting program. I'm happy to be able to provide so many of these resources to the community and I just wanted to comment on your outreach strategy emphasizing those that need it the most I really appreciate that approach and I can speak from personal experience with the help to others program that this was really utilized when you've had this program before and I just really want to commend the water department to really being able to look at that and bring equity into it so thank you. Thank you for the report. This is a great program it appears to be. I'm curious about how you are going to select plumbers. So we have a list of criteria that would be in the request for qualifications so they have to be a licensed plumber for example so basically anyone that meets those criteria would be eligible to participate. We wanted to have ability for our customers to select a plumber as opposed for us to assign them a plumber that way they could select somebody local or and it also allows more plumbers to be able to participate and sort of share the wealth amongst them. Some plumbers are super busy and may not have the ability to install all 2,000 toilets so we sort of wanted to give customers the opportunity to choose who their plumber might be. Can I ask another question? Go ahead. I'm planning on working with like PHCC, the plumbing and heating contractors, you know, the associations, the builders exchange potentially to get the word out to plumbers who have to express their desire to be in the program, right? That's a great question. We can certainly reach out to them. Right now we have a list of local plumbers that we called from previous work that we've done with them. We have a list of about 60 plumbers from Sonoma, Mendocino and Lake County and Marin County. So we've got a list that's pretty substantial but you're right. There's more opportunities to reach out to those local folks. So thanks for that. There are a motion to approve the recommendation. I move to approve the recommendation. I'll second. Okay, let's take public comment now on this item. If there's anyone wishing to make a comment, please come forward. If you wish to make a comment via Zoom, please raise your hand. If you're dialing in via telephone, please dial star nine to raise your hand. Is there anybody who would like to comment in the room? Seeing no one. Teri Montoya. There are no hands raised on Zoom and no email or voicemail comments were received. All right, please take a roll call vote. Board Member Wright. Aye. Board Member Walts. Aye. Board Member Bartholomew. Aye. Board Member Batenfort. Aye. And Vice Chair Ernone. Aye. And that passes with five affirmative votes with Board Member Walsh and Chair Galvin absent. Very well then. Moving to item 7.2. Director Burke, could you introduce that item? Yes. Thank you, Vice Chair Ernone. Members of the Board, item 7.2 is our report item on the Sonoma County Water Agency 2023-24 Water Transmission Budget and Rate Increase. And introducing the item will be Nick Harvey, our Budget and Financial Analyst Manager. And then we also have from Sonoma Water, Lynn Rizelli and Jake Spalding. Thank you, Director Burke. And thank you, Vice Chair Ernone. Members of the Board, it's a pleasure to be here. I'm here to introduce both Lynn Rizelli and Jake Spalding with Sonoma Water. We'll present the proposed water transmission budget for fiscal year 2023-24. Before they begin, I wanted to quickly review the annual process for approving the proposed budget and rates and explain where we currently stand in the process. So after developing the budget and proposed rates, they're then brought before and discussed by the Budget Subcommittee, the Technical Advisory Committee, commonly referred to as the TAC, in conjunction with staff from Sonoma Water. The process of discussing the water transmission budget and proposed rate increases of tax budget subcommittee was concluded on March 6, where the subcommittee voted with only two yes votes and several members abstaining and Santa Rosa Water voting no. This resulted in the subcommittee being unable to recommend the new rates and budget to the full TAC. On March 6, the TAC itself also took a vote where they recommended the 2023-24 proposed water transmission budget and related rate increase. It's important to know, however, that Director Burke, Santa Rosa Water's TAC representative, voted against the recommendation. For context, Santa Rosa Water's current rate structure was developed assuming a maximum wholesale water rate increase of 6%. After factoring in an anticipated 5% increase in water deliveries, as well as Sonoma Water's proposed 10.56% proposed adjustment to the wholesale water rate. We estimate our fiscal year 2023-24 water purchase budget will exceed our fiscal year 2022-23 numbers by approximately $2.5 million. If the proposed rate structure is ultimately approved by the Sonoma Water Board of Directors, Santa Rosa Water will absorb the cost increases utilizing our undesignated fund balance. From here, each contracting agency will work with their representative on the Water Advisory Committee, also referred to as the WAC, to coordinate how their agency representative will vote for the purposes of WAC's recommendation to the Sonoma Water Board of Directors, which is scheduled to take place at its April 18, 2023 meeting. For Santa Rosa Water specifically, the process of the recommendation begins with reviewing Sonoma Water's proposed water transmission budget here with you and then requesting your recommendation to City Council regarding possible direction to its WAC representative at the March 28, 2023 Council meeting. Council will then review the information and make a recommendation as to how they would like their representative on the WAC to vote. As a reminder, it's ultimately up to the discretion of Sonoma Water Board of Directors to make the decision on how they will proceed, including setting the rate increases that will actually be implemented. All votes leading up to that point in the process are simply recommendations. On that note, I will now hand over the presentation to Ms. Roselli and Mr. Spalding from Sonoma Water. Thank you, Nick. So good morning, everyone, or good afternoon, actually. My name is Jake Spalding. I am the Finance Manager for Sonoma Water. I'm here with Lynn Roselli, our Division Services Manager. So real quick, I'm going to provide you with an overview of our Fiscal Year 23-24 water transmission budget. I would just like to add, you know, each year we do develop this budget to meet all of our operations, our maintenance, our capital, and also regulatory demands. This year, similar to last year, we do have a heightened need for infrastructure repairs and upgrades so Sonoma Water can continue to operate the system 24-7 in a reliable manner. So real quick, an overview of our system. We do have three main aqueducts. They're shown on this slide in purple, blue, and green. They're the Santa Rosa, the Petaluma, and the Sonoma Aqueducts. Each one of our customers is primarily off of one of these three aqueducts. Santa Rosa, obviously, being off the purple Santa Rosa aqueduct in this slide. And each customer pays the rate that's associated with that aqueduct. They're not all the same. So as Nick stated, you know, each year we do submit a draft budget to the TAC Ad Hoc Budget Committee in mid-January, and then we go through a collaborative and transparent process with all the water contractors, ultimately bringing this to our board in mid-April, which is a stipulation of the restructure of the agreement for water supply. We are required to have our board approve the rates before the end of April. And I do just want to thank Nick and Kimberly and Jennifer for their participation and input in this process as we, at both the subcommittee and at the TAC level. So our system, it's pretty complicated. We do have multiple funds, which you can see on this slide. Each one of these funds does have its own budget and rate, and then all of those are combined to come up with the overall rate. So Sonoma Water, similar to Santa Rosa, you know, we do have a relatively robust system, but we are facing a lot of challenges at the moment. Most of our facilities are currently 45 to 65 years old, having expended much of their useful life. And, you know, in fact, actually 40% of our assets currently have only 10 to 20% of their useful life remaining. And so not too different than owning a used car or an aging car. Maintenance needs increase with age. We do have an inactive preventative maintenance program to help the system, but we have seen an uptick in recent years in corrective maintenance and emergency repairs, which is an indication of the age of the system. In addition to age, you know, our system is vulnerable to an array of natural hazards, primarily flood, fire, and earthquake. Obviously earthquake is our greatest vulnerability, both in terms of service disruptions to the community as well as extensive damage. And I'm bringing this up just to say the budget that we're presenting addresses all these needs. They can all be addressed in one year, but we are addressing them through this budget. So what's in the budget this year? Well, on the capital side, this year we're actually completing or will be completing a few very important hazard mitigation projects. And we're proposing to do additional projects next year, totaling roughly $6.3 million. You know, we have been able to find a lot of offsetting revenue to offset these costs. In fact, we've raised over $10 million in FEMA funding for hazard mitigation projects in the past, and we are seeking additional funds for the projects that you see on the screen, and ones farther out in our long-range financial plan to help offset those future costs. In addition to the hazard mitigation projects, our capital program is proposing $5.9 million for other projects that increase resiliency of the system. The projects that you do see on the screen have $1.1 million in grant revenue programmed, offsetting grant revenue programmed into them as well. So when you can combine the projects on the previous slide with the projects on this slide, we're proposing a total capital budget of roughly $12.3 million. The budget includes $40.4 million for operations and maintenance projects. We've highlighted a few of the priority projects on this slide, including the multi-phase aqueduct cathodic protection programs, which help prevent corrosion in the aqueducts that serve our communities, as well as a 10-year, $88 million tank maintenance rehabilitation and recoding program, which also includes security improvements to some of our infrastructure. So the projects that you see here, these are our highest priority projects. They're integral to maintaining our aging system and ensuring that we have a reliable water supply. On some of the other funds, we are proposing $9.78 million for the biological opinion, water supply planning, and water conservation. On the Dry Creek Habitat Enhancement project side, we continue to make progress on phases 4, 5, and 6, which is in partnership with the U.S. Army Corps. In fact, they're picking up 65% of the cost share on these projects, which is a big savings to all the water contractors. The budget this year also does include $150,000 match contribution towards the Potter Valley Project Russian River Water Forum grant that we just submitted to DWR. If this application is awarded, additional match contributions would come from the County of Sonoma, County of Mendocino, as well as Sonoma Waters Russian River Projects Fund. And lastly, you know, in addition to implementing a very robust water conservation program in partnership with some of the staff members that were just up here, this year's budget is proposing an additional $3.8 million grant also through the Department of Water Resources. And if that's awarded, it would give us facilitate additional implementation of water conservation and reuse initiatives. So on this slide, you can see the budget for fiscal year 23-24. We're proposing a total budget of $68.3 million, which is offset by $18.15 million in grants, use of fund balance and bond proceeds. You know, it's important to note on this slide that we are proposing a budget that is 3.5% less than our budget last year. In fact, you can see that all the line items are going down with the exception of the operations and maintenance budget. And that's really a reflection of the, you know, deferred maintenance that needs to be completed in that one fund for all this aging infrastructure that we have. This slide is just to exemplify where the majority of our expenditures occur. About 60% are going to operations and maintenance, followed by capital projects, the sub funds, and finally less than 10% going to debt service. So real quick, I just want to give you a little primer on how our water rates are calculated, and this is a simplified version. But in essence, we take the cost of operations and maintenance, and we divide it by the amount of water sold. And this is stipulated in the Restructured Agreement that we either need to use the last 12 months of actual water deliveries, or the last three years annual average. Those two numbers I just put up on the screen. And as you can see, the last 12 months were significantly less than the three-year annual average. So when you plug that in to the equation, you come out to about $1,173 an acre foot. You know, the purpose of this slide really is just to show you that our rates are fully volumetric, and that means, you know, all else being equal when we're budgeting off lower deliveries, your rate is going to be higher, and vice versa. It's important to note the 41,847 acre feet we're budgeting off this year, that's an 8.5% reduction from what we budgeted on last year. And when you compare rates this year and this year, that account that lower delivery number is really accounting for about 90% of the increase that we're proposing. So Sonoma Water understands that rate increases are not something anyone is happy about. We've taken steps to help reduce the budget and reduce the rate increases this year. We were able to bring the rate down from an initial look when we did it of over 20% down to 10.56 by taking a couple measures. That includes deferring projects of $2.4 million of projects. These are lower priority projects that our staff felt they could defer. Not the high priority ones that we can't defer any longer. We were also trim budgets where we could. Lately there has been some softening in the energy market, and so we have been able to find some cost savings there. And we also drastically increased the use of grant spawn proceeds and fund balance this year. I did want to mention, you know, in fiscal year 23-22-23 we actually did have to use some of our prudent reserve. Right now our budget has $1.5 million of our reserve programmed into it. And this is because we're anticipating a revenue shortfall between four and $6 million. And actually now that we've got the latest month's numbers in there, it's definitely trending towards the higher end. This is something that the Water Advisory Committee at a date when rates are not increasing so much that they're going to be rebuilding. So this slide shows you the proposed water rates. As you can see, they range from 9.42 to 10.56%. Santa Rosa is in that middle column at 10.56. You know, without the use of the fund balance and the bond proceeds and the grant funds, the rate increase would have been drastically higher. Water contractors do also have a discretionary capital charge that uses a rate stabilization tool and also to build fund balance for future capital projects. Some of the aqueducts did elect to reduce that this year because it can help bring the rate down farther. Santa Rosa is elected to keep the customers on the Santa Rosa aqueduct have elected to keep it at the same rate as last year to help build that fund balance and prevent future rate spikes. You know, once again because we're a fully volumetric rate about 90% of the deliveries that you see on the screen is really attributable to the fact that we're budgeting off lower deliveries. The remaining 10% really is these deferred maintenance projects that have been deferred for several years that we've made an effort, you know, a conscious effort to keep the rate low during some of the years with disasters, pandemics and other hardships. But they can't be deferred any longer. And while it's not an exact number, you know, we are estimating a monthly increase in a residence average bill. But, you know, the biggest factor in that really is individual consumption and use. So it's a hard factor to come up with. So this slide compares our water rates to other water wholesalers in the area. As you can see, Sonoma water is on the far left-hand side. We do continue to have very low cost compared to the other water wholesalers in the area. You know, I would note that similar to the challenges we're facing, all these districts are facing the same ones. You know, we've all been experiencing very low deliveries. In formal communications and in informal communications with them, we are hearing that they're anticipating rate increases between 5.5% and 15% this year. So that would actually bring their rates even higher. So what does this mean long term? Currently, our long-range financial plan has $272.5 million programmed into it through 2030. And that's for cost that would affect customers on the Santa Rosa Aqueduct. The majority of these are for hazard mitigation, water resiliency, and maintenance projects with a little bit of money in there on the biological opinion as well. Our current estimate of future rate increases shows an estimated rate of 6.3% to 11.3% before coming back down to a future year increases around 4%. There's a lot of assumptions built into this model and it's a very conservative model. It does assume, you know, a certain number of growth and deliveries, but it does not include any grant funding in it. And Sonoma Water has been very successful at securing grant funding for hazard mitigation and other projects. We have every anticipation that we would have all funds in the future to help bring this rate down. And with that, I'll pass it back to Nick. Thank you, Jake. Okay, so as far as the Santa Rosa water budgetary impacts, again, with the 10.56% proposed increase on the wholesale water rate, that puts us at a $2.5 million increase overall projected for our water purchase budget. And just to put that in real terms for you, the 2223 water purchase budget, or in other words, the year we're currently in, is currently at $15.3 million. And this would jump out up to a projected $17.8 million for next year. Another thing to point out is with the 10.56 and the 11.3% projected increases, Santa Rosa would need to have two consecutive years of a 5% rate increase. And just for context, under the currently adopted rate schedule, we're scheduled to increase rates by 3% in July 2023 and 4% in July 2024. So we need an additional two-thirds the first year and additional 25% the second year. And the other thing to take note about that is the that would be just to cover our projected increase in the wholesale water purchase. It does not take into account organizational increases that the department would bear. And as we mentioned earlier, since our current rate structure is set up to absorb a 6% rate increase, the difference between the two figures is going to be covered by fund balance. Next slide, please. In terms of impacts to our customers, since we already have a currently adopted rate model and the rates are set for the next year, our customers will not see any impact in the following two years. As we've already mentioned, it's going to be covered by fund balance. And then that second point there, adjustment to future rate cycle is what I just described. We would actually need a projected 5% increase for two consecutive years in order to get back to baseline and have our expenditures fully covered by our rate model. And that's before considering the departmental cost increases once again. So the next steps, Lynn and I are giving presentations to city town councils and water district boards this month. We'll then bring this to the water advisory committee on April 3rd. And then finally we'll take it to our board of directors on April 18th for adoption. I would just say in summary, Sonoma Water, we're proposing this budget, we understand that it's a large increase. We took a lot of efforts to try and bring it down including proposing an overall budget that's 3.5% less than last fiscal year. We are kind of held hostage by the restructured agreement and the terms in there and the low deliveries that we're experiencing. So given those conditions, we deferred projects. We're utilizing as much fund balance, grant dollars and we're making advantage of those relationships we have with partners like the Army Corps where we can get cost share paid on projects we need to implement. So the rate increase while tie, it's really it's necessary to invest in the critical infrastructure that we operate, address the deferred maintenance that we have on our books and implement drought and reliability projects and to remain prepared for natural consequences that could happen any day. So thank you. Thank you for your presentations. Let's open it now for board questions and discussions. I just wanted to make an observation before we start that because as part of the presentation I was hoping to hear but I didn't hear it and having to do with history. Last time we set our rates in Santa Rosa and we set them up, we made a change in the way we do our rates and previously our rates were determined by using a pass through of whatever we paid for the wholesale rate and that was simply pass through on to the rate payers together with whatever operational budget there was. And the concern that we had about that was that it left our rate payers not knowing exactly what their rate was going to be but there was a desire to increase the reliance, the ability to rely on a number for folks and so after what I recall as being fairly extensive conversations with Sonoma Water and assurances that the expected increases were going to be between four and six and wouldn't exceed that we set our rate at a fixed six percent increase and relied upon that guidance we received to lock ourselves into a five-year rate plan that we can't change now until we do the next rate study. So as a result of that our rate payers are not going to see any increase as a result of this year or even next year but there's going to be a dramatic impact down the road the next time we have to set rates and whether we can continue doing fixed rates or have to go back to the pass through remains to be seen but I just feel we kind of made an important decision based on the set of assumptions that have now turned out to be incorrect and that's difficult for me to process. It's just the historical part of this that I just wanted to remind people that we took actions based on assurances we received and now those have turned out to be different than we were led to believe so I guess that's an extended comment so let me ask if there are other board members who have comments or questions. Thank you for the presentation and for the record these are all good projects that the agency is suggesting and I support the biological opinion and I appreciate all the grants and all that kind of stuff that you've gone after. I probably won't be supporting this item mostly I don't want to ask higher rates on to our customers in future years but also because I believe that we're going to have a rebound in water sales and we're going to and you're going to in the whole community is I think our community is they want to use the water on their gardens I know personally I've starved my garden for the last two or three years and I want to I'm going to water it this year so I believe that the numerator even though it may be set by the restructured agreement in the calculation is not the real numerator that excuse me I guess it's denominator excuse me I'm upside down I inverted myself is not the number that is what's going to happen in reality and I personally believe that if if the if the agency went with a lower rate they could pick up the difference with increased our water sales and so that's my position thank you actually a couple of my my questions were were were answered by vice so thank you it was a bit about the pastor rate in the history in Santa Rosa but just a quick one on slide 15 I'm always curious when there's a a chart and we're at one end what's to the left of Sonoma County water agency on wholesale water rates which agencies are listed on the chart which ones are to the left of the Sonoma County water agency meaning they have lower rates than we do we found one we believe and the name of the I'm not escaping me but they have a system that is less complex than ours and smaller than ours but they have a lower rate but we have only found one in California that's lower and I don't off the hand have that number handy okay and thank you very much by the way for the presentation I've been here for several years and actually every year when I see this chart I wonder what are the dynamics of anybody that has lower water waste water rates than what's being proposed and just a friendly recommendation in the future would actually be really illuminating to see the dynamics of what's on a lower rate per acre foot thank you yes thank you I too had similar questions and I think some of them were answered but I was curious with your long range financial plan the past years have been considered as far as when we've had a rebound from a drought and water sales go into effect and kind of where that change has occurred where we were estimating that a 6% at the height and then we're seeing a 4% or higher what kind of happened to to the long range financial plan for the future so we can avoid that while we're doing our rate setting because obviously it's not just cost of our budget so it is very important and we do have to make sure that we're representing our rate payers to the best of our abilities so I just wanted to know a little bit more about what goes into the long range financial plan and where that that gap kind of how that gap occurred just to give you a little bit of perspective over the past two decades average water deliveries for Sonoma water have been 52,000 acre feet and we have now we're now in the third year of a drought unprecedented drought and our water deliveries are at 41,847 acre feet so that's a huge difference and with a fully volumetric rate every $400,000 has an impact on the rate and the rate increase and so what we have built into the long range financial plan was we didn't anticipate a three year drought that would end up with water deliveries as low as 41,800 acre feet and even over the last 10 or 15 years averages have been 48,000 acre feet so we're extremely low and that has dramatically put pressure upward pressure on the rates in the long range financial plan and the long range financial plan that we're showing you as Jake mentioned it's extremely conservative it doesn't assume any grant work it assumes that all the projects that are in there that are going to occur on the schedule that they're going to occur and there's certainly room for discussion and negotiation and discussions with water contractors around phasing of projects and grant funding for projects so that we can look at making that long range financial plan work a little bit better for the water contractors so we wanted to just present to you the most conservative of our projections based on the water deliveries but the water deliveries that were used in prior projections were all higher because they did not anticipate this low did we run some stress tests in prior years to look at slightly lower rates yes slightly lower deliveries and did they have rates that were slightly above 6% yes we did present those to the water contractors but you know it was determined that that the expectation was that the water deliveries would be higher than what they are today does that sort of answer your question yes I do have follow-up though I think just for my own clarification so the long range financial plan that's on slide 16 can you explain when that was conducted versus the one previously that gave us that 4 to 6% suggested rate increase and just when that change happened I guess that's where I'm curious if that we were due for another long range plan and it happened this last year and then it was that 10 plus percent increase because I think when we raised based our rates on that five year we were assuming that 6% was to cover that full five years so I'm just curious of when the financial planning occurs and how we can avoid this increase in the future so the the financial plan that was run previously was based on higher deliveries and so and that was several years back but it was based on higher deliveries it was not based on the lower deliveries this model is based on lower deliveries and projections that are fairly low 1.5% increases in demand over the years so the amount of deliveries that are going to occur out years on the model are actually much lower than they were in the previous model and at the same time we were assuming that the projects that were going to occur at the same time that are going to occur at the same time in the model and we're now three years down the road so those projects are now occurring in the model and they're very expensive projects they're very high cost capital projects that are occurring and that we need to start working on or that we're projecting that we need to start working on and that is resulting in the increases in the rates that are shown in that model whether that's actually going to be the final version we don't know I mean there's more discussion the model it's just a model and it is something that can be worked on further and negotiated and determined what can be done to adjust either the projects or grant funding or other things and the timing of projects to reduce those rate increases but the big difference between what we showed a couple of years ago and what we're showing today one was that we were primarily focused on the biological opinion and dry creek habitat enhancement project whether we're going to build the dry creek pipeline or we're going to do the dry creek habitat enhancement projects along with the local hazard mitigation projects and that was the main focus and we basically turned off all of the capacity related projects that were further out on the what we believe were further out on the timeline and after the urban water management plan that was just in 2020 the timing for those capacity projects was moved up on the timeline and so that has caused the actual the cost in more not too just in future to be much higher so previously we focused on dry creek habitat enhancement and local hazard mitigation and we had higher deliveries and now we're focusing on local hazard mitigation enhancement but not a pipeline and other capacity projects that will be occurring out in the timeline with much lower deliveries but again it's something that is a model and there are assumptions that go into the model and we can work on looking at those assumptions and making adjustments going forward I appreciate all the details I think for me the difficulty is when we get into our own rate setting for I think next year we'll be starting that for the next five years and when we're trying to make sure that our customers have consistency and we're kind of dependent on your financials and especially your long range financial plan I think that it just makes it a little difficult on how how do we move forward when if we're in the future if we have some concerns about how certain of the models might have to panned out this time around and I don't think I'm being very articulate but I think that that's where I'm just struggling and I understand the infrastructure needs and they're there, the projects are very clear it just means that 2025 and 2026 our customers are going to get a hit because because of the needs and maybe the model not understanding that the delivery is low hopefully it rebounds like Board Member is suggesting and people use water while we have it but I think that that's where I'm just concerned and hopefully we can figure out a way before next year where we can really give that information to our customers and so that they're not stick or shocked when they see their bills in 2025 and beyond and I just add on the demand side we have heard from some water contractors they are anticipating increased demand and some of our we have to look at our portfolio as a whole because that's going to determine how much we're going to deliver during the year but should we deliver more water than budgeted this year the additional revenue that comes in would go into fund balance and every year when we're doing the budget we do take a look at that and we use that fund balance as we're doing this year to help lower that rate so anything that happens this year unexpected we would be able to utilize next year to help soften the rate increase because we're in the third year of this drought and extremely low deliveries we have eroded away our fund balance our ability to use more fund balance because we use it in prior years to keep the rates below 5% and so and we've averaged below 5% for the past 5-10 years but we do use that fund balance but because of the drought we have enough fund balance to use this year to bring the rate down further yes, thank you I have so many questions of course I'm not going to probably ask most of them because I'm new, I've never been through this process so I'll go offline to ask many of my questions I do have one though that hasn't been asked by any of the other board members and that's around grant funding so the long-range financial plan assumed no grant funding in the increases on the graph I was unclear in your presentation I was just going to add it assumes no new grant funding that we haven't already secured if we have a project that has already secured grant funding but is multiple year it may include that grant funding okay so my question around grant funding is if you get additional grant funding this year are there grants out there that you're still pursuing that could affect is it would it be able to decrease the rate a little bit or would it just then go into to the fund like the increased sales of water would it depends so the projects that we have already applied for grants on the grant revenue is programmed into the budget for 2324 if we applied for something new that wasn't anticipated at the time we did the budget then that would bring the project cost down now you wouldn't see that change the rate once it's set but it would reduce the cost and that would build up additional fund balance that could be used the next year I may have heard this wrong but I thought you said that you were pursuing grants right now that could potentially do that yes and when I say that it's not necessarily for what's budgeted in this fiscal year some of the projects like the hazard mitigation projects are the planning stages and we typically apply for the infrastructure funding in order to construct the project so the grant funding basically if we were to get grant funding tomorrow it wouldn't impact this rate increase but it would certainly bring the rate increases down in future years thank you one last comment I just think we need to keep in mind I understand the explanation for much of this increase is because of decreased sales but we can't forget that the reason we had decreased sales is because we asked people to use less water you know this is something we asked people to do and now the consequences of them doing a really good job of decreasing water usage during the route period of time is coming back to I don't know it seems very ironic to me that this is being caused by people doing what we asked them to do and that given that fact it makes a lot of sense to me to really try to smooth this out over a longer period of time because we're really disincentivizing future compliance by doing something like this I appreciate the presentation and I appreciate the fact that these are formulas that you can change the data inputs and get different answers and so there's massaging of numbers that always happens and I really hope that some consideration is giving to massaging those numbers in a way that spreads out the impact upon the ultimate rate payers so that's I guess my last comment any other comments what we need is a motion that will make a recommendation to the city council as to what the BPU feels should be the vote of the WAC member that will address this at the next WAC meeting so the council it's Mayor Rogers is the member who will be attending that meeting and the council will give her direction on how they ask her to vote and we're just trying to inform that decision with our recommendation so we need a motion of some sort to give guidance to the city council whether it is to direct their member to support the budget request or not to support the budget request and to vote no so does anybody wish to make one of those motions okay I'll make the motion that we to the city council that we recommend that our WAC advisor vote no our WAC representative vote no on this budget thank you that works is there a second second okay so now is the time for public comment on the motion that is now on the table if you wish to make a comment via zoom please raise your hand if you're dialing in via telephone please dial star nine to raise your hand is there anyone in the audience that would like to make a comment on this item if not do we have anybody online there are no hands raised on zoom for public comment and no voicemail or emails were received okay can I ask then for a roll call vote yes board member right board member watz aye board member barthelot aye board member battenfort vice chair arnone aye okay and that passes with five affirmative votes with board member walsh thank you this concludes this matter and again thank you very much for your presentations realize it's a very complicated matter but I do appreciate the input and your responsiveness to our questions thank you that takes us to the time for public comment on items that are not on the agenda if you if anyone wishes to make a comment on an item that is within the jurisdiction of the BPU but not on the agenda now is the time to do so would like to make a comment via zoom please raise your hand if you're dialing in via telephone please dial star nine to raise your hand does anyone wish to make any comments from the audience in the room today seeing no one rise do we have anybody online there are no hands raised on zoom and no voicemail or email comments received thank you so that takes us then to item number nine there are no referrals are there any written there are no written communications that I'm aware of are there any subcommittee reports that any members would like to report on I have two apparently director Devenport go ahead yes the contracts review subcommittee met on March 13th to review one agreement which was unanimously recommended by the subcommittee this was the agreement approved today on our board agenda which was a funding agreement between the city of Santa Rosa and the California department of water resources for dispersing state budget earmarked funds to Santa Rosa water for the purposes of implementing a water use efficiency direct install program remember what yes thank you the budget subcommittee we met on March 13th as well and we reviewed the water wastewater storm water and creeks and regional all of the budgets and we voted unanimously to support a recommendation to the full bpu which you will see at an April meeting I forget the exact date but happy to take any questions thank you very much for that report the other subcommittee reports how about board member reports public excuse me a public comment and it was a time for public comment on the subcommittee reports if you'd like to make a comment please on zoom you know what to do so is there anybody in the room who would like to make a comment on the subcommittee reports seeing nobody is there anybody online there are no hands raised and no voicemail or email comments received thank you very much board member reports director's report thank you vice chair nonian members of the board I do have just a few items to let the board know about first I just wanted to let the board know that our local collection system experienced minimal impact due to the recent storms although with the blue sky out you wouldn't think we just had all these atmospheric rivers hitting us we did have one small issue with our willow side lift station that required us to bring an additional staff we had two crews operating combo to assist the pumps at the lift station to make sure we didn't have an overflow and once the rain slowed our collections team inspected and cctv the neighborhood for potential for potential infiltration sources and we will be developing an outreach plan to inform the neighbors of the impacts of unauthorized connections such as some pumps and downspouts so we did see quite an influx in that area we know that area is prone to have some pumps and so we do want to do an educational campaign just to remind customers that it should not be connected to the sanitary sewer but our staff did a great job getting through the storms not only in the local sewer side but also at the treatment plant next I wanted to let the board know that we are excited to announce that we are working on our strategic asset management plan for Santa Rosa water and that will include the local operation system regional operation system and the storm water system the strategic asset management plan will be a roadmap for the effective management maintenance and improvement of the city's water sewer recycled water and storm drain assets and we also anticipate developing a cip policy regarding project prioritization and equity selection we held an RFP or we put out an RFP a request for proposals we had three different proposals that were reviewed and thank you to Board Member Wright who was on our review panel we selected GHD and awarded them a contract and we are kicking off that project we kicked off that project last month and we'll be meeting regularly starting this month and then last week another item that I'm happy to announce is that we took delivery of our first all electric truck last week so you may see a 2023 Ford F-150 lightning in blue but it might not stay blue on the street paired with the crew that performs leak detection and underground service alerts this is the first of these units we've received and we're looking to have more department fleet soon we are continuing to to recognize that we will need to have significant investment in charging infrastructure to achieve our city council climate change goal and meet statewide mandates necessitating the electrification of our vehicle fleets and so to that end this first vehicle will help us gather valuable data regarding charging times, frequency and operational constraints as we embark upon the transition to an electrified fleet and wanted to also let the board know that we are working together with other departments to kick off a citywide project to develop a fleet electrification master plan in the coming months the projects will evaluate and prioritize electrical charging infrastructure at city-owned facilities to accommodate an electrical vehicle fleet that meets the operational needs of our community and we look to share more information on this master plan as it's completed with both the board and the council and that is my presentation and I'm happy to or my report sorry and I'm happy to answer any questions you might have Yes I have one question director for the storms did I interpreted that we had no sanitary sewer overflows is that true that is correct congratulations to the entire district that is fantastic news that was not an easy thing to do I imagine many districts will not be able to report that Yes I cannot commend the operation staff enough at both for the water and sewer system but also out at the regional treatment plant they all did a fabulous job ensuring that we got through these storms very well both for no SSOs but also treating water and we did not go off spec either with our treatment so it was a great job by both teams Any other questions? Let's now take comment on the director's report if you wish to make a comment via zoom please raise your hand if you are dialing in via telephone please dial star 9 to raise your hand is there anybody in the room that would like to make a comment? There are no hands raised on zoom and no email or voicemail comments received very well that concludes our business today so the meeting is adjourned Well good job after experiencing it one time I know is that all that